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Suditi Industries Ltd.

BSE: 521113 Sector: Industrials
NSE: SUDITIND ISIN Code: INE691D01012
BSE LIVE 10:10 | 23 Nov 73.90 0.60
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VOLUME 1075
52-Week high 86.50
52-Week low 38.00
P/E 46.19
Mkt Cap.(Rs cr) 124
Buy Price 73.90
Buy Qty 25.00
Sell Price 73.95
Sell Qty 400.00
OPEN 74.00
CLOSE 73.30
VOLUME 1075
52-Week high 86.50
52-Week low 38.00
P/E 46.19
Mkt Cap.(Rs cr) 124
Buy Price 73.90
Buy Qty 25.00
Sell Price 73.95
Sell Qty 400.00

Suditi Industries Ltd. (SUDITIND) - Director Report

Company director report

Dear Shareholders

The Directors have pleasure in presenting the Twenty Sixth Annual Report of the Companytogether with the Audited Balance Sheet as at 31st March 2017 and the Profitand Loss Account for the year ended on that date.

Financial Results: (Standalone)

(Rs. in Lakhs)

Current Previous
Particulars Year Ended 31.03.2017 Year Ended 31.03.2016
Export Sales 3.61 10.15
Local Sales 10474.21 8044.09
Other Income 39.37 56.71
Gross income 10517.19 8110.95
Profit before Interest
and Depreciation 834.42 736.05
Finance Cost 290.79 298.55
Profit after Finance Cost 543.63 437.50
Depreciation 178.91 173.90
Profit / (Loss) before Tax 364.72 263.60
Provision for Tax 146.27 222.43
Profit / (Loss) after Tax
before extra ordinary items 218.45 41.17
Extra Ordinary Items (Net) - 105.50
Net Profit 218.45 146.67
Add: Brought forward from
the previous year 1012.49 901.23
Transfer to Securities
Premium / ESOP 30.68 -
Amount available for appropriation 1261.62 1047.90
Proposed Dividend - 29.35
Tax on Proposed Dividend - 6.06
Balance carried to Balance Sheet 1261.62 1012.49

Dividend:

In order to balance the growth and developmental activities of the company as well asto fulfill the aspirations of the public stakeholders the promoters have in writingwaived their entitlement on the profit distribution in the form of dividend if anydeclared by the company for the year 2016-17. Accordingly the Board after considering allthese aspects has recommended a dividend for the year under review at the rate of Rs.0.50per Equity Share only on the portion of the paid up equity capital held by the public ason 31st March 2017. No amount has been transferred to General reserve from theprofits for the year 2016-17.

Operations:

The company has registered substantial improvement in the overall performance duringthe year under review in comparison to previous year. The company has achieved an increaseof around 30% in the sales figures and a substantial increase of around 38% in the netprofits before tax in comparison to previous year. During the year the Retail divisioncontinues to make substantial contribution towards the growth in the sales and alsobrought down the operational losses in comparison to the previous year. However theoutlook of the Retail business separately as an independent business unit needs to beexamined based on the prevailing economic and market conditions. Overall the businesssentiment slightly became pessimistic due to various factors particularly from November

2016. Global economic conditions are still remaining weak due to the factors likeprotectionist measures followed in different part of the world. The company hadanticipated a much better margin levels from retails business but had to offer very highlevel discounts to remain competitive in the market. Hence the company had to absorb someamount of the losses generated by the Retail business activities. Because of this theoverall profit recorded by the company is lower than the projections for the year underreview. In spite of all these developments the country is in anticipation of improvedeconomic conditions which can augur well for the textile sector and in general there isstill great amount of optimism prevailing all over the country. The government is likelyto come with new textile policy in view of lower absorption of the work force thananticipated. Further since the company is catering to the domestic market and it has astrong presence in the domestic market there is no negative slide in the sales growth.However for the improvement of retail division the company is taking all possible measuresparticularly giving major thrust in the development of product ranges in the licentiatesegments as well as in the development of the marketing network in other formats.

The company has taken various measures to strengthen the operations of the Retaildivision to make it a profitable business. The company has discontinued the ExclusiveBusiness Outlets (EBO) and the focus is now more on the Large Format Stores (LFS) MultiBrand Outlets (MBO) and on line platform. Further the company is also plan to add morelicentiate brand under the licentiate product segment. This will eventually help theRetail Division to improve their margins substantially. Finally regarding the pending EPCGLicense issue the company has successfully redeemed one license where the liability ofthe company was substantial on account of the usage of the license amount and is nowactively pursuing the case with DGFT office to resolve the other license at the earliestwhere the usage of the amount is very small in comparison to the redeemed one.

Export Sales:

The textile export market remained sluggish throughout the year because of continuedeconomic slowdown in almost all parts of the world. Apart from this the unhealthycompetition followed by some leading textile goods manufacturing countries has created anegative impact on the price segment of the textile items. Hence the export performancefor the year is not as per the estimates made by the company. Because of these factorsthe company continued to remain focused maximum in the domestic market. Overall theexports sales are not significant and these were mainly sent in the form of finishedfabrics to neighboring country Bangladesh. The company continues its efforts to increasethe volume of fabric shipments to Bangladesh and other neighboring countries and thislargely depends on the global economic conditions as these countries in turn converts thefabric into garments for the export market. The company hopes for a breakthrough in itsefforts to explore the possibility of developing new markets in African and Far Eastcountries. However ultimately the positive changes in the global economic conditionsparticularly in the US and European economies can only pave the way for the growth of theglobal textile market. The company has now scale down the target of export from 50% toone-fourth of its capacity to the overseas customers with better value addition as thedomestic market is becoming more attractive than export market for certain varieties oftextile materials. Simultaneously the efforts are made to establish links with variousreputed buyers to align with their brands in the overseas market to promote the exports inlarge volume.

In spite of the downward trend in the global textile market the company continues totake active participation in various international Fairs/exhibitions. Once the stabilityin the global market is established India can look forward to have a better market sharethan other competitors in the global markets. Hence the prospects for the company inrespect of exports sales are still looking good in terms of better unit value realizationand volume. Besides this the company has the capability to make wide and better range ofproducts particularly in printed and embroidery varieties. In view of these companycontinues to follow its plans to increase the exports business both in volume and value.

New Licentiate Rights:

The company has developed and produced wide range of garments under licentiate rightsexecuted with globally well known football clubs like FC Barcelona Manchester City andmedia leaders like MTV. These brand LOGOS are embossed on the garments under licentiaterights acquired for India. The company is now a recognized name in this particular segmentof garments. The company is fully aware of the strengths and weakness of this brands andaccordingly a well thought out plan is there to add more such licentiate arrangements toensure that there are always some effective brands under its umbrella throughout theperiod to ensure that even if some brands crosses its shell life there are other brandsto take the sales business forward without effecting the growth momentum of the company.Further the association with "YouWeCan" backed by celebrity cricketer Mr. YuvrajSingh is also giving a big boost to the company in the sales as we have created a totallydifferent clothing line under YWC label. Even though for the company this is the firstsuch venture the company has experienced encouraging response from the market andaccordingly anticipates a good outcome from this venture in the next few years. Thecompany is now also exploring other avenues on similar lines to promote the sales withbetter value addition.

Expansion:

As decided by the management the company has not undertaken any new capital projectsduring the year under review. Further in the prevailing circumstances there is no majorexpansion plan in the current year except some addition of balancing equipments andreplacement of old machineries and equipments. Similarly for the Retail division eventhough the company plans for some expansion the same will be managed without anyadditional investment of capital nature.

Human Resources & Industrial Relations:

Human resources development is considered as one of the most important managementfunction in the company. It consists of attraction retention and development of talent ina systematic manner as an ongoing process. Various programs are made that provide focusedpeople attention. The emphasis is mainly on the promotion of talent internally through jobrotation and job enlargement. The Industrial relations with the employees at theCompany’s plant at MIDC TTC Industrial Area Pawne Village; Navi Mumbai and in theother locations continue to remain healthy and cordial.

Share capital:

The Board has approved the proposal to raise the Authorised capital from Rs.18 croresto Rs.25 crores. Since the company intend to raise funds in future through the issue ofequity shares on preferential basis to investors/promoters/existing shareholders as wellQualified institutional placements it has been decided to raise the Authorised capital tofacilitate the same. Further during the year under review the company has issued 88930shares to employees under SUDITI ESOP PLAN 2011 in the month of May 2016 and accordinglythe subscribed issued and paid-up capital has increased from Rs.16.67 Crores to Rs.16.76Crores. Apart from this during the year under review the company has not issued anyclass of shares like shares with preferential rights or sweat equity shares.

Suditi Employee Stock option Plan 2011 (Suditi ESOP 2011):

The company had made the first grant of options to the employees in the year 2013 underthe Suditi Employee Stock Option Plan 2011. Apart from this the company has furthergranted additional 13000.options in the year February 2017. In addition to this thecompany has also made another special grant of 111605 options in the month of February2017 on the eve of Silver Jubilee year celebrations to some selected employees with longtenure as well as good record of service and contributed significantly towards the growthof the organization. Each option is equal to one share at par (Rs.10/- each) being theprice fixed for exercising the right. To facilitate the employees to exercise their rightto buy the options granted to them the Company had earlier divided the total optionsgranted on certain prescribed basis over a period of 5 years. However the same system isnow discontinued in view of modification approved by the members in the Suditi EmployeeStock Option Plan 2011vide special resolution in the 25th. Annual GeneralMeeting. The share arising on exercise of the options shall be subject to a lock in periodof 1 year from allotment. The four parts of the earlier grant has been vested till thedate of 31st March 2017. The revised details are as follows:

Grant no. Granted Accepted Rejected Vested Exercised Lapsed Balance vested
No of Employees Total options No of Employees Total options No of Employees Total options Up to the Fourth part of Grant
(Nos.) (Nos.) (Nos.)
First 83 350800 20 253200 63 97600 154115 88930 21000 65185
Second 20 13000 20 13000 0 0 0 0 0 0
Silver Jubilee 38 111605 38 111605 0 0 0 0 0 0

The disclosure of the details is as follows:-(a) Options granted & accepted; 377805(b) The pricing formula: At par (c) Options vested: 154115

(d) Options exercised: During the year under review in the month of May 2016 12employees have exercised their options under the SUDITI ESOP PLAN 2011.

(e) The total number of shares arising as a result of exercise of option: During theyear under review in the month of May 2016 the board allotted 88930 shares on therecommendation of the Compensation Committee for 12 employees on exercise their optionsunder SUDITI ESOP PLAN 2011. (f) Options rejected and lapsed: 118600 (consists of 97600options rejected and 21000 options lapsed)

(g) Variation of terms of options: NA

(h) Money realized by exercise of options: 889300 (i) Total number of options in force:267875 (j) Employee wise details of options granted to:

(i) Senior managerial personnel: 220950 (includes 34250 options granted to CompanySecretary & V.P. (F) and no Director is granted any options under Suditi ESOP

Plan 2011).

(ii) Any other employee who receives a grant in any one year of option amounting to 5%or more of option granted during that year: Nil (iii) Identified employees who weregranted option during any one year equal to or exceeding 1% of the issued capital(excluding outstanding warrants and conversions) of the company at the time of grant: Nil

(k) Diluted Earnings per Share (EPS) pursuant to issue of shares on exercise of optioncalculated in accordance with Accounting Standard (AS) 20 ‘Earnings perShare’.Rs.1.30.

(l) Where the company has calculated the employee compensation cost using the intrinsicvalue of the stock options the difference between the employee compensation cost socomputed and the employee compensation cost that shall have been recognized if it had usedthe fair value of the options shall be disclosed. The impact of this difference onprofits and on EPS of the company shall also be disclosed:

The impact on account of this will reduce the profits by Rs.3801589/- and accordinglyon proforma basis the company’s basic and diluted earnings would have been Rs.1.08and Rs.1.07 respectively:

(m) Weighted-average exercise prices and weighted-average fair values of options shallbe disclosed separately for options whose exercise price either equals or exceeds or isless than the market price of the stock: NA

(n) A description of the method and significant assumptions used during the year toestimate the fair values of options including the following weighted-average information:

(i) Risk-free interest rate: 6.69% (ii) Expected life: 3 years (iii) Expectedvolatility: 4.84% (iv) Expected dividend: Rs.0.50 per share

(v) The price of the underlying share in market at the time of option granted: 1stgrand Rs.7.68 and the second grand Rs.68.40.

Particulars of Employees:

Pursuant to the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 details are stated separately in the Managerial Remuneration.

Meetings:

A calendar of meetings is prepared and circulated in advance to the Directors. Duringthe year four Board Meetings and four Audit Committee Meetings were convened and held. Thedetails of which are given in the Corporate Governance Report. The intervening gap betweenthe Meetings was within the period prescribed under the Companies Act 2013.

Board Evaluation:

Pursuant to the provisions of the Companies Act 2013 and Regulation 25 of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the IndependentDirectors have reviewed the performance of all the Directors including their ownperformance as well as the evaluation of the working of its Audit committee Nomination& Remuneration committee and other Compliance Committees. The details are provided inthe Corporate Governance Report.

Declaration by an Independent Director(s) and reappointment if any:

A declaration by an Independent Director(s) that they meet the criteria of independenceas provided in sub-section (6) of Section 149 of the Companies Act 2013 has beensubmitted to the Board in the first Board Meeting for the year 2017-18. An independentdirector shall hold office for a term up to five consecutive years on the Board of aCompany but shall be eligible for reappointment for next five years on passing of aspecial resolution by the Company and making disclosure of such appointment in theBoard’s report.

Remuneration Policy:

The Board has on the recommendation of the Nomination & Remuneration Committeefollows a policy for selection and appointment of Directors Senior Management and theirremuneration. The Remuneration Policy is stated in the Corporate Governance Report.

Managerial Remuneration:

A) Details of the ratio of the remuneration of each director to the medianemployee’s remuneration and other details as required pursuant to Rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014. (Enclosed asAnnexure II)

B) Details of the every employee of the Company as required pursuant to 5(2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014. Thestatement of the name of the top ten employees in terms of remuneration drawn is given inAnnexure II). Further the statement showing the requisite information pursuant to theCompanies (Appointment of Managerial Personnel) Rules 2014 is not annexed herewith asthere are no employees covered by the rule (2)(i) (ii) & (iii).

C) Any director who is in receipt of any commission from the company and who is aManaging Director or Whole-time Director of the Company shall receive any remuneration orcommission from any Holding Company or Subsidiary Company of such Company subject to itsdisclosure by the Company in the Board’s Report. Nil

D) There are no disclosures to be made as the directors except the Chairman &Managing Director are not in receipt of any remuneration or stock options other thansitting fees and reimbursement of expenses incurred for attending the meeting. The detailsare furnished separately in the corporate governance report.

Details of Subsidiary/Joint Ventures/Associate Companies:

The company has incorporated two subsidiaries in the month of March 2015. One of thesubsidiaries M/s. Suditi Design Studio Limited has commenced sales business activitieswhile the other subsidiary M/s. Suditi Sports Apparel Limited is yet to commence theirsales business operations. The details pursuant to sub-section (3) of section 129 of theAct (AOC-1) containing the salient feature of the financial statement of a company’ssubsidiary or subsidiaries associate company or companies and joint venture or venturesetc are annexed herewith in the Notes of the Accounts – Point 47. The Company hasalso presented the Consolidated Financial Results along with the Standalone FinancialResults of the Company. The Consolidated Financial Results are the combined performance ofthe Company along with its Subsidiaries and the details of the same are provided alongwith Notes to Accounts.

Summary of Sales: (Rs. in Lakhs)

Particulars Suditi Industries Limited Suditi Design Studio Limited Suditi Sports Apparel Limited (Subsidiary) Consolidated
(Subsidiary)
Sales 10517.19 2070.84 - 12464.38*
Profit 218.45 (6.21) (3.18) 209.06**

* Consolidated figures are arrived net of Inter Company Sales.

** The Consolidated profit figures do not include minority interest.

The growth in the sales business activities of the subsidiaries has a direct impact onthe performance of the holding company as they also sources their part of the materialrequirement from the Company at the best prevailing market rate on arms length basis. Inaddition to this it also increases the overall profitability of the holding companybesides providing value addition and brand value to the Company in the Market. It enablesthe Company to ensure focused attention to the certain market segment which otherwise notcatered or explored by the Company in the regular course of business.

Deposits:

The Company has not accepted any deposits within the meaning of Section 73 & 76 ofCompanies Act 2013 and the rules made there under.

Energy Technology and Foreign Exchange:

The particulars relating to conservation of Energy Technology Absorption and ForeignExchange earnings and outgo as required under Section 134 (3) (m) of the Companies Act2013 is given in the Annexure I forming part of this report.

Directors & the Key Managerial Personnel:

In accordance with the provisions of section 152 of The Companies Act 2013 Smt.Sanjula Sanghai retire by rotation at the forthcoming Annual general meeting and beingeligible offer herself for reappointment. Further the company is in the process ofdeveloping and inducting a Chief Financial Officer (CFO) internally from the existingavailble resources to take over the function of CFO which is now held by the Chairman& Managing Director.

Directors’ Responsibility Statement:

The Directors hereby confirm: -

i) That in the preparation of the annual accounts the applicable accounting standardshave been followed along with proper explanation relating to material departures;

ii) That the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit and loss of the Company for that period;

iii) That the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

iv) That the Directors have prepared the annual accounts on a ‘going concern’basis;

v) That the directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively and;

vi) That the directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems are adequate and were operatingeffectively;

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 andeffective during FY 2016-17.

Corporate Governance:

A separate section on Corporate Governance and a certificate from the Auditors of theCompany regarding compliance of conditions of Corporate Governance as stipulated underRegulation 34 & other applicable Regulations of the SEBI (Listing Obligations &Disclosure Requirements) Regulations 2015 (Listing Regulations) form part of the AnnualReport.

Cost Audit:

In view of the new Companies (Cost Records & Audit) Rules 2014 and amendmentthereof the company is now out of the purview of the Cost Audit Report Rules. Hence thecompany has not appointed any Cost Auditor for the year 2017-18.

Auditors:

Pursuant to the provisions of section 139 of the Act and the rules framed thereafterM/s. Chaturvedi & Co Chartered Accountants were appointed as statutory auditors ofthe Company from the conclusion of the twenty third annual general meeting (AGM) of theCompany held on September 12 2014 till the conclusion of the Twenty Sixth AGM to be heldin the year 2017 subject to ratification of their appointment at every AGM. In view ofthe expiry of their term the company has proposed to appoint another audit firm in theplace of the existing auditor. The board after careful review and based on therecommendation of the Audit committee has selected and proposed M/s Chaturvedi andpartners Chartered Accountants as the auditors for a period of 5 years from theconclusion of this Annual general meeting till the conclusion of the thirty first Annualgeneral Meeting. Accordingly necessary resolution to this effect is proposed in the noticecalling 26th.Annual General Meeting for the approval of the members.

Secretarial Audit Report:

In terms of Section 204 of the Companies Act 2013 and the rules made there under Shri.Shivhari Jalan Practicing Company Secretary had been appointed as Secretarial Auditors ofthe Company. The report of the Secretarial Auditors is enclosed as Annexure separately tothis report. The report is self-explanatory and does not call for any further commentother than the explanation given on the appointment of Chief Financial Officer.

Internal Audit & Controls:

The Company has appointed M/s. Ram Agarwal & Associates as the internal Auditor tocarry out the internal audit functions including the task of suggesting and implementingthe recommendations to improve the control environment. Their scope of work includesreview of processes for safeguarding the assets of the Company review of operationalefficiency effectiveness of systems and processes and assessing the internal controlstrengths in all areas. Internal Auditors findings are discussed with the process ownersand suitable corrective actions taken as per the directions of Audit Committee on anongoing basis to improve efficiency in operations.

Vigil Mechanism:

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 made available to each and everystakeholder and the Company has designated two senior officials as Vigilance Officers tosupport the Vigilance Mechanism functions.

Risk management policy:

A statement indicating development and implementation of a risk management policy forthe Company including identification therein of elements of risk if any that in theopinion of the Board may threaten the existence of the company as given separately in theCorporate Governance Report.

Extract of Annual Return:

As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of annual return in MGT9 forms part of this Annual Report as ANNEXURE III.

Material changes and commitments if any to report 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:

There are no such material changes and commitments to report under this head otherthan the proposal to increase the Authorized capital to facilitate issue of securities bythe Board on preferential basis to the Institutional as well as other investors for thepurpose of raising funds for supplementing the requirement of the expansion ofRetail/Other business activities.

Details of significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and company’s operations in future:

There are no such significant and material orders passed by any regulators to reportunder this head.

Details in respect of adequacy of internal financial controls with reference to theFinancial Statements:

The company has set up vigilant internal control mechanism to ensure that the financialstatements prepared are true fair and transparent. The company has set up strong internalaudit department apart from Management committee to ensure that all the financialtransactions executed are in compliance with applicable laws and regulations and in linewith the budget plans. Any variations or deviations are appropriately dealt with by theinternal Audit department as well as by the Audit committee. The Company has appointed anindependent Chartered Accountant Firm to improve and strengthen further the existingstandard operating procedures and same is implemented in stages. According to themanagement the present mechanism followed in the company is adequate and effective. Thedetails are also stated in the Management discussion and analysis report annexed herewithand form part of this report.

Particulars of loans guarantees or investments under section 186 of the companies Act:

There are no loans/guarantee or security provided during the year under review. Thedetails of investments made till date are as follows: - Details of Investments:-

Sl Date of No investment Details of Investee Amount Purpose for which the proceeds from investment is proposed to be utilized by the recipient Date of BR Date of SR Expected rate of return
(if reqd)
1 01/04/15 Suditi Sports 4 lakhs Business 16/01/2015 NA 1 0 %
Apparel Ltd. activities
2 01/04/15 Suditi Design 4 lakhs Business 16/01/2015 NA 1 0 %
Suditi Design activity
14/03/16 do 82 Lakhs Development of 11/02/2016 NA
Business activity

Particulars of contracts or arrangements with related parties:

The particulars of contract or arrangements entered into by the Company with relatedparties at arm’s length basis referred to in sub-section (1) of section 188 of theCompanies Act 2013 is disclosed in Form No. AOC-2 as Annexure IV

Obligation of company under the "Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013:

The company has set up a separate internal compliance committee under the "SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013."The Internal Complaints Committee is empowered to look into complaints relating to sexualharassment at work place of any women employee. Accordingly the Company has adopted apolicy for prevention of Sexual Harassment of Women at workplace and the Committee ensuresthat the said policy is properly implemented all over the company. During the year Companyhas not received any complaint of harassment.

Corporate Social Responsibility (CSR):

The disclosures as per Rule 9 of Companies (Corporate Social Responsibility Policy)Rules 2014 is not applicable to the company.

Transfer of amounts to Investor Education and Protection Fund:

The Company does not have any funds lying unpaid or unclaimed for a period of sevenyears in respect of unclaimed/unpaid dividends. Therefore there are no funds on thisaccount which are required to be transferred to Investor Education and Protection Fund(IEPF). Pursuant to the provisions of the Investor Education Protection Fund (Uploading ofinformation regarding unpaid and unclaimed amounts lying with companies) Rules 2012 theCompany has already filed the necessary form and uploaded the details of unpaid andunclaimed amounts lying with the Company as on the date of last AGM with the Ministry ofCorporate Affairs.

Listing with Stock Exchange:

The Company confirms that it has paid the Annual Listing Fees for the year 2017-2018 tothe Bombay Stock Exchange Limited where the Company’s Shares are listed. Further theBoard in their meeting held on 6th.February 2017 has approved the proposal tolist the securities of the company with National Stock Exchange Ltd also.

Appreciation:

Your Company and its Directors wish to place on record their sincere appreciation forthe support and assistance extended by different Central and State Government Departmentsand Agencies Banks and Financial Institutions Insurance companies Customers andVendors. Your Directors are thankful to the esteemed shareholders for their continuedsupport and confidence reposed in the company and its management. Your Directors also wishto place on record their deep sense of appreciation to all the employees of the Companyfor their outstanding and dedicated contribution made towards the growth of the Company.

For and on behalf of the Board of Directors

Place: Mumbai PAWANAGARWAL
Date: 09.08.2017 CHAIRMAN & MANAGING DIRECTOR

Annexure I

Information under Section 134 (3)(m) of the Companies Act 2013 read with Companies(Disclosure of particulars in the Report of Board of Directors) Rules and forming Part ofthe Directors Report for the year ended 31st March 2017.

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

The details of conservation of energy technology absorption foreign exchange earningsand outgo are as follows:

a) Conservation of Energy:

Energy conservation is an important task and plays a crucial role in the development ofany country. The company regularly observes and follows with utmost importance all theenergy conservation measures practiced in the industry and takes all possible measures toimplement them in the manufacturing units of the company to the maximum possible extent.Side by side the company also takes a active part in the environmental improvements planand towards this extend the company has installed bag filters and other monitoringequipments which will help to improve the quality of the air in the factory.

(i) the steps taken or impact on conservation of energy The company continues to follow the measures taken in the previous years like installation of Auto Dosing controllers replacement of old machines with energy saving machines and continuous monitoring with effective preventive maintenance programme which helps the company to conserve the energy and to reduce the wastage of energy thereby saving in cost.
(ii) the steps taken by the company for utilizing alternate sources of energy The company is assessing with the suppliers of Solar power systems the prospects of the usage of solar energy to support heating and daytime usage of lights in the plant.
(iii) the capital investment on energy conservation equipment's The capital investments on the items installed till date are not very significant.
(b) Technology absorption:
(i) the efforts made towards technology absorption There are no significant efforts made during the year in regard to technology absorption. However the company continues to monitor the various developments that unfold from time to time in this industry.
(ii) the benefits derived like product improvement cost reduction product development or import substitution Up gradation of technology is mainly aimed towards quality improvement with cost benefits.
(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)- NIL
(a) the details of technology imported NIL
(b) the year of import; NIL
(c) whether the technology been fully absorbed NIL
(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof NIL
(iv) the expenditure incurred on Research and Development Insignificant

(c) Foreign exchange earnings and Outgo:

(Rs. in Lakhs)

Particulars Current Year Previous Year
(2016-17) (2015-16)
Total Foreign Exchange used 28.99 21.80
Total Foreign Exchange earned
(FOB Value) 3.61 10.15

For and on behalf of the Board of Directors

Place: Mumbai PAWAN AGARWAL

Date: 09.08.2017 CHAIRMAN & MANAGING DIRECTOR