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Loyal Textile Mills Ltd.

BSE: 514036 Sector: Industrials
NSE: N.A. ISIN Code: INE970D01010
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OPEN 670.00
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VOLUME 121
52-Week high 889.95
52-Week low 561.10
P/E 14.42
Mkt Cap.(Rs cr) 325
Buy Price 646.00
Buy Qty 1.00
Sell Price 674.00
Sell Qty 3.00
OPEN 670.00
CLOSE 646.00
VOLUME 121
52-Week high 889.95
52-Week low 561.10
P/E 14.42
Mkt Cap.(Rs cr) 325
Buy Price 646.00
Buy Qty 1.00
Sell Price 674.00
Sell Qty 3.00

Loyal Textile Mills Ltd. (LOYALTEXTILE) - Director Report

Company director report

Your Directors have great pleasure in presenting their 71 Report on the business andoperations of the Company together with the audited Financial Statements (Standalone andConsolidated) of accounts for the year ended 31 March 2017.

1. SUMMARISED FINANCIAL HIGHLIGHTS

Financial results for the year under review are as follows:

Particulars Standalone Consolidated
Particulars 2017 2016 2017 2016
GROSS PROFIT 135.58 154.66 137.68 157.50
Less : Interest 42.03 54.52 42.21 54.78
OPERATING PROFIT 93.55 100.14 95.48 102.7
Less : Depreciation 67.70 67.21 68.21 67.96
Profit BEFORE TAX 25.85 32.93 27.27 34.76
Less: Current Tax 6.75 8.25 6.75 9.15
Profit AFTER CURRENT TAX 19.10 24.68 20.52 25.61
Less: Excess Provision for FBT of earlier years reversed /Earlier Year tax provision NIL (0.23) NIL (0.23)
Less: Deferred tax (7.59) (1.07) (7.59) (1.07)
Profit AFTER
DEFERRED TAX 26.69 25.98 28.10 26.91
Add : Surplus brought forward from previous year 54.87 37.29 62.43 44.03
Less: Dividend Tax NIL 0.98 NIL 0.98
Less: Proposed Dividend on Equity Shares (100%) NIL 4.82 NIL 4.82
Less: Withdrawal on account of Depreciation as per Schedule II of the Companies Act 2013 NIL NIL NIL NIL
Add: Reversal of Deferred Tax Liability on account of Transition NIL NIL NIL NIL
Less: Transfer to
NIL 2.61 NIL 2.71
General Reserve
Balance carried to next year 81.55 54.86 90.53 62.43
Earning Per Share
Basic EPS per Share 55.41 53.93 58.35 55.86
Diluted EPS per Share 55.41 53.93 58.35 55.86

2. DIVIDEND

Your Directors recommend a Dividend of Rs.10.00 per equity share of Rs.10/- each (100%)for the financial year ended 31 March 2017 amounting to Rs.4.82 Crores on which Dividenddistribution tax comes to Rs. 0.98 Crores.

The Dividend will be paid to members whose names appear in the Register of Members ason 21 September 2017 and in respect of shares held in dematerialized form it willbe paid to members whose names are furnished by National Securities Depository Limited andCentral Depository Services (India) Limited as beneficial owners as on the same date.

3. SHARE CAPITAL

The paid up Equity Share Capital as on March 31 2017 was Rs.4.82 crores. During theyear under review the company has not issued any shares or any convertible instruments.

TRANSFER TO RESERVES

During the year under review the Company has not transferred any amount to the GeneralReserve.

4. MATERIAL CHANGES & COMMITMENT AFFECTING THE FINANCIAL POSITION OF THECOMPANY

There are no material changes affecting the financial position of the Companysubsequent to the end of the financial year of the Company till the date of this report.

5. PERFORMANCE REVIEW MANAGEMENT DISCUSSIONS ANALYSIS REPORT AND OUTLOOK FORTHE CURRENT YEAR

The year under review has been a challenging one. Rupee appreciation and cotton priceincrease together with man power issues impacted our performance. During the Q1 thesudden appreciation of Rupee and the consequent increase in our Quotes in USD forced usto lose a fair number of orders.

While the overall turnover dropped from Rs. 1178.25 crores to Rs. 1138.57 the exportof own production of yarn and fabrics increased from Rs. 656.96 crores to Rs. 700.15crores.

The total term loans stand at almost the same level when compared to last fiscal year.However our efforts to deleverage and reduce the overall debt is on track.

Except for a labour strike at Cuddalore unit we enjoyed a cordial relationship withall our stake holders during the year.

We have won the coveted TEXPROCIL Gold Trophy for the tenth time in a row for highestexport of grey cotton fabrics.

RENEWABLE ENERGY

During the year the company generated 52.22 Lakhs units of Solar energy which wasfully consumed by us. During the year 742.39 lakh units of wind energy was generated outof which 691.06 lakh units were consumed.

Windmill power evacuation was much better compared to the previous year.

Consumption of wind energy during the year was 818.46 lakh units including purchasedquantity.

ITALIAN JOINT VENTURE

Italian joint venture is performing satisfactorily. The JV Company has made a profit of6.10 lakh Euros pre-tax and 4.10 Euros post tax.

LOYAL INTERNATIONAL SOURCING PRIVATE LTD.

We have decided to close the operations of Loyal International Sourcing P Ltd. as thecompany made losses during the year. During the year the cotton prices went up steeplyduring the Q1 and Q2 and most vendors refused to deliver as per contract. We had todeliver as per contract and also pay for delays. This caused losses and dragged down theturnover as it took time to resolve issues with the customers and vendors. New marketdevelopment and new customer development did not happen in spite of marketing spend. Hencewe have decided to close the operations.

BRANDED GARMENTS

We have developed the product and got initial orders; deliveries will start from endAugust. Initially the ladies leggings and Pallasos will be introduced and later Men'sunder wear and ladies Petticoats. The initial target turnover for the year is 12 crores.

We have taken two senior sales managers who will head West & South and North &East sales. We also have a marketing product development and design manager on board. Wewill be taking ASMs and sales team in due course of this month and complete the staffingby end June / July to ensure that once the goods reach the super stockiest our fieldstaff are in place.

INVESTMENTS

During the year fixed investments made were made mainly in the area of infrastructureimprovement and adding a few balancing equipments besides the PROBAN flame retardantprocess machines.

In the coming year too the main investments will be in infrastructure improvementgarmenting capacity increase at Cuddalore and Menakur balancing equipments at Cuddaloredyeing unit besides Solar power.

PROSPECTS FOR THE FY 2017-18

Cotton price is predicted to fall down.

The man power issues are almost coming to an end. The accelerated training program isreducing the cost of training substantially and is producing good workers with betterretention.

Renovation and upgrading of equipment with new generation controllers is in the lastphase of completion at our Cuddalore dyeing unit. We see a growth in the sales ofprocessed fabrics during 2017-18.

Our brand is getting launched with dispatches happening by end of August 2017. Thoughthe initial target is Rs. 12 crores it will improve to Rs. 50 crores and more during thesubsequent years.

6. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

All amounts which are due to be transferred to the investor Education and ProtectionFund are regularly monitored and transferred. During the year 2009-2010 the Companydeclared 30% of dividend hence the unpaid dividend amount being the amount due andpayable and remaining unpaid for a period of 7 years shall be transferred to InvestorEducation fund in the month of October 2017. Members who have not encashed the Dividendwarrants for the financial year ended 2010-11 and / or any subsequent years are requestedto write to the Company with necessary details.

7. EXPORTS

During the year under review the company exported goods to the tune of Rs. 990.93Crores (Previous year Rs.1024.36 Crores).

8. MODERNISATION

A sum of Rs.26.57 Crores (previous year Rs.48.75 Crores) was spent on modernization/replacement of plant and machinery during the year under review.

9. CREDIT FACILITIES / FINANCE

During the year the company availed term loans to the tune of Rs.105.90 Crores andrepaid loans to the extent of Rs.126.94 Crores to Banks/Financial institutions.

10. FIXED DEPOSITS

During the year the company has not accepted any deposits from the public anddirectors.

11. DONATION

During the year 2016-17 the Company has paid a donation of Rs.101.71 Lakhs.transactions with related parties.

The Board of Directors of the Company has on the recommendation of the AuditCommittee adopted a policy to regulate transactions between the Company and its RelatedParties in compliance with the applicable provisions of the Companies Act 2013 the Rulesthere under and the Listing Agreement. This Policy was considered and approved by theBoard has been uploaded on the website of the Company at www.loyaltextiles.com underinvestor info/ policy documents Related Party Transaction Policy link.

12. ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of The Companies (Accounts) Rules 2014 is annexed herewith as Annexure -A.

13. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

The information required pursuant to Section 197(12) read with Rule 5(2) and Rule 5 (3)of The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 inrespect of employees of the Company and Directors is attached as Annexure B to thisreport 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) Rules2014 are provided in the Annexure-B tothis report

14. REPORT ON CORPORATE GOVERNANCE

A detailed report on Corporate Governance is annexed to this report as Annexure - C.The Company has complied with the conditions of corporate governance as stipulated inRegulation 24 25 26 and 27 of Securities and Exchange Board of India (Listing obligationand Disclosure Requirement) Regulations 2015. The Managing Director has given acertificate of Compliance with the Code of Conduct which forms part of Annexure C asrequired Regulation 27 of Securities and Exchange Board of India (Listing obligation andDisclosure Requirement) Regulation 2015.

The Statutory Auditors of the Company have examined the requirements of CorporateGovernance with reference to Regulation 15(2) of SEBI ( Listing Obligation and DisclosureRequirement) Regulation 2015 and have certified the compliance as per the requirementof Listing regulations.

The Certificate in this regard is attached as Annexure-D to this Report.

The Managing Director certification as required under Regulation 17(8) of Securitiesand Exchange Board of India (Listing Obligation and Regulation Requirement) Regulation2015 is attached as Annexure E to this report.

15. CONSOLIDATED FINANCIAL STATEMENT

The Consolidated Financial Statements of the Company prepared in accordance withrelevant Accounting Standards (AS) viz. AS 21 and AS 27 prescribed under Companies(Accounting Standards) Rules 2006.

16. SUBSIDIARIES AND JOINT VENTURES

Pursuant to Section 129(3) of the Companies Act 2013 read with Rule 5 of the Companies(Accounts) Rules 2014 the statement containing salient features of the financialstatements of the Company's Subsidiaries and Joint Ventures (in Form AOC-1) is attached tothe financial statements.

Loyal International Sourcing Private Limited (100 % Wholly Owned Subsidiary Company)was started in the year 2014.

17. CORPORATE SOCIAL RESPONSIBILITY (CSR)

In terms of section 135 and Schedule VII of the Companies Act 2013 the Board ofDirectors of your Company have constituted a CSR Committee. The Committee comprises ofthree Directors out of which two Directors are Independent Directors and other Director isa Whole Time Director. CSR Committee of the Board has developed a CSR Policy under HealthCare activities and Educational Activities which is enclosed as part of this report Annexure-F.The CSR Policy is available at www.loyaltextiles.com under investor info/ policydocuments/ CSR Policy link.

The company has contributed to a Charitable Trust a sum of Rs. 55 Lakhs for spendingfor CSR activities which is more than the amount required to be spent u/s .135 of theCompanies Act 2013. The details of amount spent and category the same will be publishedin the next report.

18 . VIGIL MECHANISM /WHISTLE BLOWER POLICY

In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for Directors and employees to report genuine concerns has beenestablished. The Vigil Mechanism Policy has been uploaded on the website of the Company athttp:// www.loyaltextiles.com under investor info/ policy documents/ Whistle BlowerPolicy link.

19. RELATED PARTY TRANSACTIONS

Related party transactions that were entered during the financial year were on an arm'slength basis and were in the ordinary course of business. There were no materiallysignificant related party transactions with the Company's Promoters Directors Managementor their relatives which could have had a potential conflict with the interests of theCompany. Transactions with related parties entered by the Company in the normal course ofbusiness are periodically placed before the Audit Committee for its omnibus approvalParticulars of contracts or arrangements with related parties referred to in section188(1) of the companies Act 2013 in the prescribed form AOC-2 is attached as AnnexureG. Also Refer Note No.45 of Financial statement which sets out thepositive attributes independence of a Director and other related matters has beenprovided in the Corporate Governance Report which is attached as Part III to Para- 2 of AnnexureC to this report.

20. RISK MANAGEMENT POLICY

The board members were informed about risk assessment and minimization procedures afterwhich the board formally adopted steps for framing implementing and monitoring the riskmanagement plan for the company.

The main objective of this policy is to ensure sustainable business growth withstability and to promote a pro-active approach in reporting evaluating and resolvingrisks associated with the business. In order to achieve the key objective the policyestablishes a structured and disciplined approach to risk management in order to guidedecisions on risk related issues.

In today's challenging and competitive environment strategies for mitigating inherentrisks in accomplishing the growth plans of the company are imperative. The common risksinter alia are: regulations competition business risk technology obsolescenceinvestments and retention of talent and expansion of facilities.

Business risk inter-alia further includes financial risk political risk fidelityrisk and legal risk.

As a matter of policy these risks are assessed and steps as appropriate are taken tomitigate the same.

Major risks which the organization faces have been identified and systematicallyaddressed through mitigating actions on a continuing basis. There is an adequate riskmanagement infrastructure in place capable of addressing the risks.

The Board has developed and implemented a Risk Management Policy for the companyincluding identification of elements of risk which in the opinion of the Board maythreaten the existence of the Company. The said policy can be viewed on the Company'swebsite at the link: http://www.loyaltextiles.com/policy-documents.html

21. REMUNERATION POLICY OF THE COMPANY

The remuneration policy of the company comprising the appointment and remuneration ofthe Directors Key Managerial Personnel and Senior Executives of the Company includingcriteria for determining qualifications

22. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

In compliance with Regulation 25 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Board has adopted a policy on familiarisationprogramme for Independent Directors of the Company. The policy will enable the IndependentDirectors to understand their role rights and responsibility in the Company.

The Policy on Familiarisation Programme as approved can be viewed on the Company'swebsite at the link: http://www.loyaltextiles.com/policy-documents.html

23. DIRECTORS KEY MANAGERIAL PERSONNEL & COMMITTEES

Mr.P.Manivannan Whole time director of the Company has been re-appointed for a termof 5 years with effective from 1 November 2016 subject to the approval of theshareholders at the ensuing Annual General Meeting.

Mr.R.Mohan Chief Financial Officer of the Company resigned his post of ChiefFinancial officer of the Company and his resignation was accepted at the Board Meetingheld on 11 November 2016 with effective from 24 February 2017.

Mr.M.Arumugam Company Secretary of the Company has resigned from the post of theCompany Secretary because of personal reasons and his resignation was accepted in theBoard meeting held on 09 February 2017 with effective from the end of the working hoursof that day.

Mr.Vetrivel Balamurugan was appointed as Company Secretary of the Company in the BoardMeeting held on 09 February 2017.

All independent directors have given declaration that they have met the criteria ofindependence as laid down under section 149(6) of the Companies Act 2013 and Regulation25 of Securities and Exchange Board of India (Listing Obligation and RegulationRequirement) Regulation 2015.11

Smt. Vishala Ramaswami Daughter of Manikam Ramaswami and Valli M.Ramaswami wasappointed as General Manager of the company at the Board meeting held on 9 February 2017

23.1 AUDIT COMMITTEE

The company is having Audit Committee comprising of following Directors:

NAME STATUS CATEGORY
Shri. K.J.M.Shetty Chairman Independent Director
Shri.S.Venkataramani Member Independent Director
Shri.Shridhar Member Independent
Subrahmanyam Member Director

RECOMMENDATION OF AUDIT COMMITTEE

During the year under review all the recommendations made by the Audit Committee wereaccepted by the Board.

23.2 NOMINATION AND REMUNERATION COMMITTEE

The company is having a Nomination and Remuneration Committee comprising of thefollowing directors:

NAME STATUS CATEGORY
Shri. K.J.M.Shetty Chairman Independent Director
Shri.S.Venkataramani Member Independent Director
Shri.R.Poornalingam Member Independent Director

23.3 CSR COMMITTEE

The company is having a Corporate Social Responsibility Committee comprising of thefollowing directors:

NAME STATUS CATEGORY
Shri. K.J.M.Shetty Chairman Independent Director
Shri. Madhavan Nambiar Member Independent Director
Shri. P.Manivannan Member Whole Time Director

23.4 STAKEHOLDERS' RELATIONSHIP COMMITTEE

The company is having a Stakeholders' Relationship Committee comprising of thefollowing directors:

NAME STATUS CATEGORY
Shri. K.J.M.Shetty Chairman Independent Director
Shri. S.Venkataramani Member Independent Director
Shri. P.Manivannan Member Whole Time Director

23.5 RISK MANAGEMENT COMMITTEE

As per Regulation 21 of SEBI (Listing Obligation and Disclosure Requirement)Regulation 2015 risk management committee is applicable to Top 100 listed entitiesdetermined on the basis of market capitalization. Our Company does not come under TOP 100listed entities

Hence the board dissolved the Risk Management Committee in the Board Meeting held on 10February 2016.

24. BOARD EVALUATION

As required under the provisions of Section 134(3) (p) of the Companies Act 2013 andSEBI Listing Regulations the Board has carried out a formal annual evaluation of its ownperformance and that of its committees and individual directors based on the guidelineformulated by the Nomination & Remuneration Committee.

Further the Independent Directors of the Company met once during the year on 29.05.2017 to review the performance of non-independent directors performance of the Chairmanand performance of the board as a whole.

Details of performance evaluation of Independent Directors as required under ScheduleIV to the Companies Act 2013 is provided in Report on Corporate Governance.

25. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The Company has adequate system of internal control to safeguard and protect from lossunauthorized use or disposition of its assets. All the transactions are properlyauthorized recorded and reported to the Management. The Company is following all theapplicable Accounting Standards for properly maintaining the books of accounts andreporting financial statements. The internal auditor of the company checks and verifiesthe internal control and monitors them in accordance with policy adopted by the company.

DETAILS ON INTERNAL FINANCIAL CONTROLS RELATED TO FINANCIAL STATEMENTS

The Company has put in place adequate internal financial controls with reference to thefinancial statements some of which are outlined below.

The Company has adopted accounting policies which are in line with the AccountingStandards prescribed in the Companies (Accounting Standards) Rules 2006 that continue toapply under Section 133 and other applicable provisions if any of the Companies Act2013 read with Rule 7 of the Companies (Accounts) Rules 2014 and relevant provisions ofthe Companies Act 1956 to the extent applicable. These are in accordance with generallyaccepted accounting principles in India. Changes in policies if any are approved by theAudit Committee in consultation with the Statutory Auditors.

The policies to ensure uniform accounting treatment are prescribed to the subsidiariesof the Company. The accounts of the subsidiary company is audited and certified by theStatutory Auditors for consolidation.

The Company operates in an ERP system and has many of its accounting records stored inan electronic form and backed up periodically. The ERP system is configured to ensure thatall transactions are integrated seamlessly with the underlying books of account. YourCompany has automated processes to ensure accurate and timely updation of various masterdata in the underlying ERP system.

The Company in preparing its financial statements makes judgments and estimates basedon sound policies and uses external agencies to verify/ validate them as and whenappropriate. The basis of such judgments and estimates are also approved by the StatutoryAuditors and Audit Committee.

The Management periodically reviews the financial performance of the Company againstthe approved plans across various parameters and takes necessary action wherevernecessary. The Books and records of the company are checked by the qualified externalinternal auditors who render their report to the audit committee.

The Company has a code of conduct applicable to all its employees along with a WhistleBlower Policy which requires employees to update accounting information accurately and ina timely manner. Any non-compliance noticed is to be reported and actioned upon in linewith the Whistle Blower Policy.

Your Company gets its Standalone accounts reviewed every quarter by its StatutoryAuditors.

26. DIRECTORS' RESPONSIBILITY STATEMENT

To the best of our knowledge and belief and according to the information andexplanations obtained by us your Directors make the following statements in terms ofSection 134(3) (c) of the Companies Act 2013:

a) in the preparation of the annual accounts for the year ended March 31 2017 theapplicable accounting standards have been followed along with proper explanation relatingto material departures;

b) the Directors have selected such accounting policies and applied them consistentlyand made judgements 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 March 31 2017 end of the profitof the company for the year ended on that date ;

c) the Directors have 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 fraud and otherirregularities;

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

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

f) the Directors had devised proper system to ensure that systems to ensure compliancewith the provisions of all applicable laws and that such systems are adequate andoperating effectively.

27. LISTING

The Company's equity shares continue to be listed on the Bombay Stock Exchange Mumbai.The listing fee for the financial year 2016 2017 has been paid to BSE and the AnnualCustodian fee has been paid to the NSDL and CDSL for the financial year 2016-17.

28. AUDITORS

28.1 STATUTORY AUDITORS'

The Statutory Auditors of the Company M/s. Suri & Co. (Firm Regn No:004283S.)Chartered Accountants was appointed at the 68 Annual General Meeting of the Company for 3years and hold office till conclusion of the 71 Annual General Meeting (AGM) of theCompany i.e. Ensuing Annual General Meeting of the Company.

Under Companies Act 2013 new statutory Auditors are to be appointed. New StatutoryAuditors in the place of the retiring Statutory Auditors shall be recommended forappointment in the forthcoming Audit Committee and Board of Directors Meeting of theCompany subject to the approval of the Shareholders at the ensuing Annual General Meeting.

The said appointment resolution has been given in the Notice of the Annual GeneralMeeting of the Company to decide the same by Shareholders of the Company.

The Auditors' Report to the shareholders does not contain any qualification

28.2 SECRETARIAL AUDITORS'

Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed Mr. Bashyam (FCS No.600) Company Secretary Madurai to undertake thesecretarial audit of the company. The Secretarial Audit Report is annexed herewith as Annexure- H.

The Auditors' Report to the shareholders does not

contain any qualification

28.3 INTERNAL AUDITORS'

M/S SLSM & CO Chartered Accountants performed the duties of internal auditors ofthe company and their report is reviewed by the audit committee from time to time. Thetenure of the said Internal Auditors completed as on 31.03.2017.

Audit Committee at its meeting held on 9 February 2017 has recommended to giveauthorization to Mr.Manikam Ramaswami Chairman and Managing Director of the Company toappoint Internal Auditors for the Company.

28.4 COST AUDITOR

Mr.V.Balasubramanian Cost Accountant was appointed as Cost Auditor for auditing thecost accounts of your Company for the year ended 31 March 2017 by the Board of Directors.The Cost Audit Report for the year 2015-16 has been filed under XBRL mode within the duedate of filing.

29. EXTRACT OF ANNUAL RETURN

An extract of the Annual return in form- MGT- 9 as on March 31 2017 is attached as AnnexureI to this report.

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

Particulars of loans given investments made guarantees given and securities providedalong with the purpose for which the loan or guarantee or security is proposed to beutilized by the recipient are provided in the standalone financial statement (Refernote. No. 11)

31. GENERAL

A. Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:

1. Issue of equity shares with differential rights as to dividend voting or otherwise.

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

3. Neither the Managing Director nor the Whole-time Directors of the Company receiveany remuneration or commission from its subsidiary.

4. 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.

B. A copy of the Financial Statements including Consolidated Financial StatementsDirectors Report Auditors Report etc. is available at the registered office of theCompany for the inspection of the members of the company during the office hours up to thedate of Annual General Meeting.

C. The Company has not furnished the statement of Changes in Equity as the requiredformat has not yet been prescribed.

D. Your Directors further state as per information furnished by POSH Committee thatduring the year under review there were no cases filed pursuant to the Sexual Harassmentof Women at Workplace (Prevention Prohibition and Redressal) Act 2013.

32. ACKNOWLEDGEMENT

Your Directors wish to acknowledge the co-operation and assistance extended by CentralBank of India Exim Bank State Bank of India Karur Vysya Bank Ltd and Indian Bank. YourDirectors appreciate the continued co-operation extended by staff and workers of thecompany and look forward to the same cordial relationship in the coming years.

For and on behalf of the Board of Directors
P.MANIVANNAN MANIKAM RAMASWAMI
Whole Time Director Managing Director
Place: Chennai
Date : 29 May 2017