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Kalpataru Power Transmission Ltd.

BSE: 522287 Sector: Infrastructure
NSE: KALPATPOWR ISIN Code: INE220B01022
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OPEN 351.35
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VOLUME 4674
52-Week high 375.00
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P/E 19.72
Mkt Cap.(Rs cr) 5,421
Buy Price 0.00
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Sell Price 0.00
Sell Qty 0.00
OPEN 351.35
CLOSE 353.30
VOLUME 4674
52-Week high 375.00
52-Week low 208.00
P/E 19.72
Mkt Cap.(Rs cr) 5,421
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Kalpataru Power Transmission Ltd. (KALPATPOWR) - Director Report

Company director report

TO

THE MEMBERS

Your Directors are pleased to present the 35th ANNUAL REPORT of your Companytogether with the Financial Statements including Audited Statement of Accounts for theyear ended March 31 2016.

FINANCIAL HIGHLIGHTS (` in Crores)
2015-16 2014-15
Net Revenue from Operations 4364.58 4422.25
Profit before Depreciation 390.22 338.04
Less: Depreciation 83.72 85.18
Profit before Tax 306.50 252.86
Less: Provision for Tax including 107.00 87.25
Deferred Tax
Net Profit after Tax 199.50 165.61
Add: Surplus brought forward from 999.79 884.75
previous year
Less: Depreciation charged against - 4.03
Retained earnings
Profit available for appropriation: 1199.29 1046.33
APPROPRIATIONS :
Transfer to General Reserve 10.00 10.00
Transfer to Debenture Redemption 16.67 9.30
Reserve
Interim / Proposed Dividend on Equity 23.02 23.02
Shares
Corporate Tax on Interim Dividend / 4.68 4.22
Proposed Dividend
Balance carried to Balance Sheet 1144.92 999.79
TOTAL 1199.29 1046.33

OPERATIONAL HIGHLIGHTS

The net revenue of your Company declined by 1.30% to Rs. 4364.58 Crores asagainst Rs. 4422.25 Crores in the previous year. Total Export Turnover (includingoverseas projects) was Rs. 2390.19 Crores or approx. 54.76% of revenues in2015-16.

The net profit for the year stood at Rs. 199.50 Crores as against Rs. 165.61 Crores in2014-15.

Your Company has supplied 146749 MTs of Transmission Line Towers as against 149539MTs in preceding year which is lower by 1.87%.

Your Company has a standalone order book of Rs. 8300 Crores excluding fairly placedbids.

The consolidated net revenue of your Company was Rs. 7380.38 Crores as against Rs.7198.21 Crores. There has been no change in the nature of business of your Company duringthe year under review.

AWARDS & RECOGNITION

A) Power Grid Corporation of India one of the major client of your Company declaredawards for the year 2015-16. Your Company was winner of following three prestigious awardsnamely:

1. "Best Transmission Line EPC Player in the country"

2. "Best safety norms on PGCIL Projects (Zero Fatal accidents)"

3. Runners up award namely "Maximum volume of work in 2015-16 on PGCILProjects" B) Raipur Plant of your Company has participated in India ManufacturingExcellence Awards (IMEA) 2015 conceptualized by Frost & Sullivan and received thesilver certificate.

C) During the year under review your Company has also received Certificate ofConformity of the Factory Production Control for the construction product "StructuralSteel Transmission Line Towers" in compliance with Regulation 305/2011/EU of theEuropean Parliament and of the Council of 9 March 2011 (the Construction ProductsRegulation or CPR) from SGS United Kingdom Limited. D) During the year under review yourCompany has received Certificate of Appreciation from Ministry of Energy and Coal Industryof Ukraine for successful completion of "750 kV Rivne NPP – Kiev SubstationTransmission Line" project one of the biggest projects of its type constructed inUkraine which was completed atleast nine months ahead of scheduled date.

TRANSMISSION BOOM PROJECT

Your Company has secured Third Transmission Line BOOM Project under tariff basedcompetitive bidding process during the year under review. The project scope involvesbuild own operate and maintain the transmission system for "Transmission SystemStrengthening in Indian System for transfer of power from new HEPs in Bhutan". YourCompany will have to establish transmission system from Alipurdaur to Siliguri andKishangarh to Darbhanga totaling to approximately line of 329 kms. Your Company has wonthis BOOM project with the levelized tariff of Rs. 129.42 Crores per annum.

MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF YOUR COMPANY

There are no material changes and commitments a3ecting the financial position of yourCompany which has occurred between end of financial year of the Company i.e. March 312016 and the date of Directors’ Report i.e. May 28 2016.

DIVIDEND

Your Directors have declared and paid an interim Dividend of Rs. 1.50 (75%) per equityshare of Rs. 2 each on March 14 2016. Your Directors do not recommend any Final Dividendfor the year ended March 31 2016.

TRANSFER TO RESERVES

Your Company has transferred following amounts to various reserves during the financialyear ended March 31 2016:

Amount transferred to Amount in Rs. Crores
General Reserve 10.00
Debenture Redemption Reserve 16.67

PERFORMANCE AND FINANCIAL POSITION OF EACH SUBSIDIARIES ASSOCIATES AND JOINT VENTURECOMPANIES

A report on the performance and financial position of each of the subsidiariesassociates and joint venture companies as per the Companies Act 2013 in the prescribedForm AOC-1 is annexed to Consolidated Financial Statements and hence not repeated here forthe sake of brevity. The brief details of the activities carried out by each of thesubsidiary and Joint Venture Company of your Company is provided below.

JMC Projects (India) Ltd. & its subsidiaries (JMC):

JMC has a strong order book of approx. Rs. 6200 Crores. Your Company holds 67.19%equity shares of JMC. JMC has successfully completed Rights issue of 7462686 Equityshares of Rs. 10 each during the year under review raising funds of approx. Rs. 150Crores. JMC has executed 3 road BOOT projects through its Wholly Owned SubsidiaryCompanies and 1 road BOOT project in Joint Venture. All the four road BOOT projects arenow fully operational on full toll and full length basis of which the SPV Company M/sVidhyachal Expressway Private Limited has received second Provisional Certificate to startoperations of Toll Plaza – 2 of Rewa Project on April 4 2016. JMC through its WhollyOwned Subsidiary is also engaged in the mining activity however there is no operation inthe said Subsidiary.

Shree Shubham Logistics Ltd. (SSLL):

SSLL undertakes an array of activities in the post- harvest value chain foragri-commodities. The activities include warehousing procurement primary processingcollateral management funding facilitation funding testing & certification andpest management in relation to agri-commodities. The activities are aimed at a widespectrum of market participants dealing in agri-commodities including farmers traders& aggregators government agencies banks and electronic commodities exchanges.Through the integrated business model SSLL believes that they are able to create value inthe post-harvest value chain.

Punarvasu Holding and Trading Company Private Limited (PHTCPL) a Wholly OwnedSubsidiary (WOS) of SSLL is registered with Reserve Bank of India as Non-Banking FinancialInstitution classified as a Non-Banking Financial Company – Loan Company and isprimarily engaged in providing direct funding facilities to participants in thepost-harvest agri-commodities. During the year under review SSLL also incorporated a WOSin Singapore namely Namo Overseas Pte. Limited ("Namo") with the objects tocarry the business of trading processing warehousing certification and pest managementof agri-commodities collateral management and funding facilitation in relation toagri-commodities and allied activities. However in view of prevailing market conditionsin Singapore Namo was struck off during the year under review.

Your Company holds 72.97 % equity shares of SSLL.

Energylink (India) Ltd. (EIL):

EIL is a Wholly Owned Subsidiary of your Company. EIL through its 100% subsidiarynamely Saicharan Properties Limited (Saicharan) is implementing commercial cumresidential project in Indore (Project). Saicharan started initial construction activitiesand has launched the Project for sale.

Amber Real Estate Ltd. (Amber):

Amber is a Wholly Owned Subsidiary of your Company. Amber has leased out and/or soldthe entire premises developed at Thane IT Park in Maharashtra.

Adeshwar Infrabuild Ltd. (Adeshwar):

Adeshwar was incorporated to venture into new areas of business which can beconveniently or advantageously run by Company in the coming years which may includemining cement transmission and related activities etc. It is a Wholly Owned Subsidiaryof your Company.

Kalpataru Satpura Transco Private Ltd. (KSTPL):

KSTPL a Special Purpose Vehicle ("SPV") was incorporated to implement DBFOTProject from Madhya Pradesh Electricity Board to build own operate and transfer 240 kms400 KV double circuit power transmission line between Satpura to Ashta in the state ofMadhya Pradesh. The Company would own project for 25 years with an option to extend theperiod for further period of 10 years as mutually agreed for which transmission licensehas been granted by Madhya Pradesh Electricity Regulatory Commission (MPERC) fortransmission of electricity from 2X250 MW extention units at Satpura TPH. It is a WhollyOwned Subsidiary of your Company.

Kalpataru Metfab Private Ltd. (KMPL) (Formerly known as Gestamp Kalpataru SolarSteel Structures Private Ltd.):

KMPL is a Wholly Owned Subsidiary of your Company. The name of the Company was changedfrom Gestamp Kalpataru Solar Steel Structures Private Limited to Kalpataru Metfab PrivateLimited during the year under review. The Company was a joint venture Company formanufacturing of steel structures for solar power panel wherein your Company and GONVARRIMS CORPORATE S.L. Spain (Gonvarri) held 50-50% share capital. Your Company purchasedbalance 50% stake from Gonvarri during the year under review.

Alipurduar Transmission Ltd. (ATL):

ATL was incorporated as Special Purpose Vehicle ("SPV") Company by RECTransmission Projects Company Limited (REC TPCL) to establish Transmission SystemStrengthening in Indian System for transfer of power from New HEP’s in Bhutan on BOOMbasis (Project). ATL will own the Project for 35 years from scheduled COD. Since yourCompany has secured this Project under tariff based competitive bidding process yourCompany has acquired ATL which is SPV Company for the Project from REC TPCL on January6 2016. ATL is a Wholly Owned Subsidiary of your Company.

Kalpataru Power Transmission USA INC. (KPT USA):

KPT USA was incorporated to increase focus on American markets with local presence. Itis a Wholly Owned Subsidiary of your Company.

Kalpataru SA (Proprietary) Ltd. (KPTL SA):

KPTL SA was formed in South Africa to bid for EPC Power Transmission jobs in SouthAfrica as local Company. It is a Wholly Owned Subsidiary of your Company. Your Company isin process for closing KPTL SA since there is hardly any extra benefit of having localpresence in South Africa.

Kalpataru Power Transmission (Mauritius) Ltd. (KPTML):

KPTML was incorporated to engage in investment holding activities. It is a Wholly OwnedSubsidiary of your Company.

KPTML has a 100% Wholly Owned Subsidiary in Dubai namely Kalpataru Power DMCC UAE.The Company was formed with the purpose of carrying out General trading activitiesPipes & Fittings Trading and Metal Alloys Trading.

LLC Kalpataru Power Transmission Ukraine (KPT Ukraine):

KPT Ukraine was incorporated to explore & execute Power Transmission contracts inUkraine. It is a Wholly Owned Subsidiary of your Company.

Kalpataru Power Transmission Nigeria Ltd. (KPTL Nigeria):

KPTL Nigeria was incorporated to explore the Power Transmission market in Nigeria. Itis a Wholly Owned Subsidiary of your Company. The Company is in process for closing theKPTL Nigeria since there is hardly any extra benefit of having local presence in Nigeria.

Jhajjar KT Transco Private Ltd. (Jhajjar KT):

Jhajjar KT is a Joint Venture Company in which your Company holds 49.72% stake.Jhajjar KT was incorporated with the objects of exclusive right and authority toconstruct operate maintain and transfer the 400kv / 200kv Transmission Lines &Substations (Transmission System) in the state of Haryana on Design Build FinanceOperate and Transfer (DBFOT) basis and provide transmission services for a period of 25years with an option to extend the period for further period of 10 years mutually agreedfor which transmission license has been granted by Haryana Electricity RegulatoryCommission (HERC) for transmission of electricity from 2X660 MW Thermal Power Plant atJhajjar.

Kalpataru IBN Omairah Company Ltd.

(KPTL- IOC LLC):

KPTL-IOC LLC was incorporated as a Joint Venture Company between your Company and IBNOmairah Contracting Company Limited in the Kingdom of Saudi Arabia in which your Companyholds 65% stake. The Joint Venture Company has been formed to undertake and executeoverhead Transmission Lines and / or substation projects on turnkey basis in Kingdom ofSaudi Arabia. During the year under review Alipurduar Transmission Limited have becomesubsidiary Company Kalpataru IBN Omairah Company Limited Kingdom of Saudi Arabia havebecome Joint Venture Company and Namo Overseas Pte Limited Singapore have become Stepdown subsidiary Company (through SSLL) of your Company. During the year under review nonew Company has become Associate Company of your Company.

During the year under review no Company have ceased to be Subsidiary CompanyAssociate Company or Joint Venture Company of your Company except Namo Overseas PteLimited Singapore which was struck o3.

Accordingly as on the date of this Report your Company have 21 direct and indirectSubsidiaries and 2 Joint Venture Companies. The statement pursuant to Section 129 (3) ofthe Companies Act 2013 containing details of these Subsidiaries forms part of the AnnualReport.

As per Section 129 of the Companies Act 2013 your Company has placed ConsolidatedFinancial Accounts before the Members for their approval. Since the Consolidated FinancialAccounts are being approved by the Members your Company has not attached the individualAnnual Report of each of the

Subsidiary Company with this Annual Report. However your Company will make availablethe Annual Accounts of the Subsidiary Companies and the related detailed information toany Member of the Company who may be interested in obtaining the same. The Annual Accountsof the Subsidiary Companies will also be kept open for inspection at the Registered Officeof your Company and that of the respective Subsidiary Company.

CONSOLIDATED FINANCIAL STATEMENTS

Your Directors have pleasure in attaching the Audited Consolidated Financial Statementspursuant to Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 prepared in accordance with Accounting Standards prescribed by theInstitute of Chartered Accountants of India. The Consolidated Financial Statementspresented by your Company include the financial results of its Subsidiary CompaniesAssociate and Joint Venture Companies.

DIRECTORS

The Board of Directors of your Company pursuant to recommendation of Nomination andRemuneration Committee in their Meeting held on May 30 2015 re-designated and elevatedMr. Manish Mohnot as a Managing Director of your Company w.e.f. June 1 2015 upto March31 2020. The Members of your Company at the Annual General Meeting held on September 292015 has approved such appointment of Mr. Manish Mohnot as a Managing Director of theCompany w.e.f. June 1 2015 upto March 31 2020.

The Members of the Company at the Annual General Meeting held on September 29 2015 hasappointed Ms. Anjali Seth as Director of your Company liable to retire by rotation.

Mr. Imtiaz Kanga was appointed as an Additional Director of your Company w.e.f. March8 2016. Pursuant to Section 161 of the Companies Act 2013 and Articles of Association ofthe Company Mr. Imtiaz Kanga holds office upto the date of the ensuing Annual GeneralMeeting. Your Company has received notice under Section 160 of the Companies Act 2013along with the requisite deposit proposing appointment of Mr. Imtiaz Kanga as Director ofthe Company.

Your Company has received declarations from all the Independent Directors confirmingthat they meet with the criteria of independence as prescribed under Section 149(6) of theCompanies Act 2013 and under Regulation 16 (1) (b) of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015. Further pursuant to Section 164(2) of theCompanies Act 2013 all the Directors have provided declarations in Form DIR-8 that theyhave not been disqualified to act as a Director.

In terms of Section 152 of the Companies Act 2013 Ms. Anjali Seth Director being thelongest in the office shall retire at the ensuing AGM and being eligible forre-appointment o3es herself for reappointment.

A brief resume of directors being appointed along with the nature of their expertisetheir shareholding in your Company and other details as stipulated under Regulation 36 (3)of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 isappended as an annexure to the Notice of the ensuing Annual General Meeting.

BOARD MEETINGS

The Board met Ten (10) times during the financial year ended on March 31 2016. Thedates on which the Board Meetings were held are May 30 2015 July 17 2015 August 72015 September 10 2015 September 29 2015 November 5 2015 January 13 2016 February10 2016 March 8 2016 and March 14 2016.

The number of Meetings of the Board that each Director attended is provided in theReport on Corporate Governance.

COMMITTEES

Your Company has several Committees which have been established as a part of bestcorporate governance practices and are in compliance with the requirements of the relevantprovisions of applicable laws and statues.

The Board has constituted following Committees:

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholder’s Relationship Committee

• Corporate Social Responsibility Committee

• Risk Management Committee

• Share Transfer Committee

• Executive Committee

The details with respect to the compositions powers roles terms of reference etc. ofrelevant Committees are given in detail in the ‘Report on Corporate Governance’of your Company which forms part of this Annual Report. The dates on which Meeting ofBoard Committees were held during the financial year under review and the number ofMeetings of the Board Committees that each Director attended is provided in the‘Report on Corporate Governance’. The minutes of the Meetings of all Committeesare circulated to the Board for discussion / noting / ratification.

All recommendation of the Audit Committee was accepted by the Board of Directors ofyour Company.

KEY MANAGERIAL PERSONNEL (KMP)

Mr. Manish Mohnot Managing Director Mr. Kamal Kishore Jain Director (Finance) &Chief Financial Officer and Mr. Rahul Shah Company Secretary of your Company are the KeyManagerial Personnel (KMP) as per provisions of Companies Act 2013. Mr. Ranjit SinghManaging Director and KMP of your Company resigned from the Board w.e.f. May 31 2015.

FIXED DEPOSITS

Your Company has not accepted any fixed deposits from the public as per the provisionsof Section 73 to 76 of the Companies Act 2013. Hence the disclosures required as perRule 8 (5) (v) & (vi) of the Companies (Accounts) Rules 2014 are not applicable toyour Company.

CORPORATE GOVERNANCE

Your Company believes that sound Corporate Governance is critical for enhancing andretaining stakeholder’s trust and your Company always seeks to ensure that itsperformance goals are met accordingly. The efforts of your Company are always focused onlong term value creation. Inherent to such an objective is to continuously engage anddeliver value to all its stakeholders including members customers partners employeeslenders and the society at large. A separate section on Corporate Governance followed byyour Company as stipulated under Regulation 34 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 is annexed to this Report. The Report onCorporate Governance also contains certain disclosures required under Companies Act 2013.

A certificate from M/s. Deloitte Haskins & Sells Chartered Accountants confirmingcompliance to the conditions of Corporate Governance as stipulated under SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 is annexed to CorporateGovernance Report.

MANAGEMENT DISCUSSION AND ANALYSIS

As per Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 a separate section on Management Discussion and Analysis outlining thebusiness of your Company forms part of this Annual Report.

CORPORATE SOCIAL RESPONSIBILITY

Your Company has formed the CSR Committee as per the requirement of the Companies Act2013. On recommendation of CSR Committee the Board of Directors’ of your Company hasapproved the CSR Policy which is available on the website of your Company atwww.kalpatarupower.com. The brief outline of the Corporate Social Responsibility (CSR)Policy of your Company and the initiatives undertaken by your Company on CSR activitiesduring the year under review are set out in Annexure A of this report in theformat prescribed in the Companies (Corporate Social Responsibility Policy) Rules 2014.

VIGIL MECHANISM

The details of establishment of Vigil Mechanism ("Whistle Blower Policy")is given in the ‘Report on Corporate Governance’ of your Company which isannexed to this Report.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Board has adopted policies and procedures for ensuring the orderly and e3cientconduct of its business including adherence to the Company’s policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial disclosures.

STATUTORY AUDITOR AND AUDITORS’ REPORT

M/s. Deloitte Haskins & Sells (Firm Registration No. 117365W) CharteredAccountants have been appointed as Statutory Auditor of the Company at the thirty thirdAnnual General Meeting held on September 27 2014 to hold office from the conclusion ofthirty third Annual General Meeting (AGM) till the conclusion of the thirty seventh AnnualGeneral Meeting of the Company subject to ratification by the Members annually.Accordingly ratification of appointment of Statutory Auditor is being sought from theMembers of the Company at the ensuing AGM. In this regard your Company has received acertificate from the Statutory Auditor to the e3ect that appointment if ratifiedit would be in accordance with the provisions of Section 141 of the Companies Act 2013.Statutory Auditor comments on your Company’s accounts for year ended March 312016 are self explanatory in nature and do not require any explanation as per provisionsof Section 134(3)(f) of the Companies Act 2013.

There were no qualifications reservation or adverse remark or disclaimer made byStatutory Auditor in its report.

SECRETARIAL AUDITOR AND SECRETARIAL AUDIT REPORT

Pursuant to the Provisions of Section 204 of the Companies Act 2013 your Company hadappointed Mr. Urmil Ved Practising Company Secretary Gandhinagar as its SecretarialAuditor to conduct the Secretarial Audit of your Company for FY 2015-16. The Report of theSecretarial Auditor for the FY 2015-16 is annexed to this report as Annexure B.

There were no qualifications reservation or adverse remark or disclaimer made bySecretarial Auditor in its report.

COST AUDITOR

Pursuant to the provisions of Section 148 of the Companies Act 2013 read with Rule 14of the Companies (Audit and Auditors) Rules 2014 the cost records in respect ofElectricity and Steel business need to be audited. In compliance to the above the Boardof Directors upon the recommendation of the Audit Committee appointed M/s. K. G. Goyal& Associates Cost Accountants as the Cost Auditor of your Company for the FY2015-16.

RISK MANAGEMENT FRAMEWORK

Your Company has reviewed the existing risk framework with the help of experts and hasimplemented Risk Management framework wherein all material risks faced by your Companyare identified and assessed. For each of the risks identified corresponding controls areassessed and policies and procedures are put in place for monitoring mitigating andreporting of risk on a periodic basis. Your Company has revamped the Standard OperatingProcedures in light of the amendment and / or re-enactment of various statutes. The RiskManagement Committee reviewed the Company’s risk management practices and activitiesfrom time to time.

PARTICULARS OF REMUNERATION

A. The ratio of the remuneration of each director to the median employee’sremuneration and other details in terms of Section 197(12) of the Companies Act 2013 readwith Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 are forming part of this report as Annexure C1.

B. The statement containing particulars of employees as required under Section 197(12)of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided in a separate annexure forming part of thisreport. However this report and the accounts are being sent to the Members excluding thesaid annexure. In terms of Section 136 of the Act the said annexure is open forinspection at the Registered Office of your Company. Any Member interested in obtaining acopy of the same may write to the Company Secretary.

PERFORMANCE EVALUATION

The criteria for performance evaluation and the statement indicating the manner inwhich formal annual evaluation has been made by the Board are given in the "Report onCorporate Governance" which forms part of this Annual Report.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FORDETERMINING QUALIFICATIONS POSITIVE ATTRIBUTES AND INDEPENDENCE OF A DIRECTOR

Your Company‘s Policy on remuneration for the Directors’ Key ManagerialPersonnel and other employees and Company’s policy on Directors’ appointmentincluding criteria for determining qualifications positive attributes independence of adirector and other matters as required under sub-section (3) of Section 178 of theCompanies Act 2013 is available on the website of your Company www.kalpatarupower.com.There has been no change in the policy since last financial year.

CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE INFLOW &OUTFLOW

Information required under Section 134 (3) (m) of the Companies Act 2013 read withRule 8(3) of the Companies (Accounts) Rules 2014 is annexed hereto as Annexure Dand forms part of this Report.

EXTRACT OF ANNUAL RETURN

Pursuant to sub-section 3(a) of Section 134 and sub-section (3) of Section 92 of theCompanies Act 2013 read with Rule 12 of the Companies (Management and Administration)Rules 2014 the extract of the Annual Return as at March 31 2016 forms part of thisreport as Annexure E.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186

Particulars of loans given investments made guarantees given and securities providedalongwith the purpose for which the loan or guarantee or security is proposed to beutilized by the recipient are provided in the standalone financial statements (Pleaserefer to Notes to the Standalone Financial Statements).

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All related party transactions that were entered during the financial year were onarm’s length basis. There were no material related party transactions i.e.transaction / transactions entered into individually or taken together with previoustransactions entered during the financial year exceeds ten percent of the annualconsolidated turnover of the Company as per the last audited financial statements enteredby your Company with its Related parties which may have a potential conflict with theinterest of your Company.

All Related Party Transactions are placed before the Audit Committee for approval interms of requirement of Regulation 23 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.

The policy on materiality of Related Party Transactions is uploaded on the website ofyour Company and the link for the same is provided in the ‘Report on CorporateGovernance’. Attention of Members is drawn to the disclosure of transactions withrelated parties set out in Note No. 46 of Standalone Financial Statements forming part ofthe Annual Report.

STOCK OPTIONS

Your Company does not have any stock options schemes.

DISCLOSURE UNDER SECTION 22 OF THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE 3PREVENTIONPROHIBITION AND REDRESSAL3 ACT 2013

Your Company has zero tolerance towards any action on the part of any executive whichmay fall under the ambit of ‘Sexual Harassment’ at workplace and is fullycommitted to uphold and maintain the dignity of every women executive working in yourCompany. The Sexual Harassment Policy provides for protection against sexual harassment ofwomen at workplace and for prevention and redressal of such complaints.

There were no complaints pending as on the beginning of the financial year and no newcomplaints were filed during the financial year under review.

POLICY ON CODE OF CONDUCT AND ETHICS

As an organization your Company places a great importance in the way business isconducted and the way each employee performs his/her duties. Your Company encouragestransparency in all its operations responsibility for delivery of results accountabilityfor the outcomes of our actions participation in ethical business practices and beingresponsive to the needs of our people and society. Towards this end your Company has laiddown a Kalpataru Code of Conduct (KCoC) applicable to all the employees of your Companyand conducted various awareness sessions across the Company. The Code provides for thematters related to governance compliance ethics and other matters.

SIGNIFICANT OR MATERIAL ORDERS AGAINST COMPANY

No significant or material orders were passed by the regulators or courts or tribunalsimpacting the going concern status and your Company’s operation in future.

STATEMENT OF DIRECTORS’ RESPONSIBILITY

Pursuant to requirement under Section 134(3)(c) of the Companies Act 2013 (Act)Directors confirm that: (a) in the preparation of the annual accounts for the year endedon March 31 2016 the applicable accounting standards read with requirement set out underSchedule III to the Act have been followed and there are no material departures from thesame; (b) they have selected such accounting policies and applied them consistently andmade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of a3airs of the Company as at March 31 2016 and of the profit of theCompany for the year ended on that date;

(c) they have taken proper and su3cient care for the maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities; (d) they hadprepared the annual accounts on a going concern basis; (e) they had laid down internalfinancial controls to be followed by the Company and that such internal financial controlsare adequate and are operating e3ectively and (f) they had devised proper systems toensure compliance with the provisions of all applicable laws and that such systems areadequate and operating e3ectively.

Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company work performed by the internal statutory andsecretarial auditors and external consultants including audit of internal financialcontrols over financial reporting by the statutory auditors and the reviews performed bymanagement and the relevant board committees including the audit committee the board isof the opinion that the Company’s internal financial controls were adequate ande3ective during FY 2015-16.

ACKNOWLEDGEMENT

Your Directors take this opportunity to thank all the financial institutions BanksGovernment and Regulatory Authorities customers vendors and members and all otherstakeholders for their continued support. Your Directors place on record their deepappreciation to employees at all levels for their hard work dedication and Commitment.The enthusiasm and unstinting efforts of the employees have enabled your Company to remainas one of the top industry leader.

On behalf of the Board of Directors
Mofatraj P. Munot
Place: Mumbai Chairman
Date: May 28 2016 DIN: 00046905