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Vippy Spinpro Ltd.

BSE: 514302 Sector: Industrials
NSE: N.A. ISIN Code: INE660D01017
BSE LIVE 15:19 | 18 Oct 46.55 -0.35
(-0.75%)
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VOLUME 2002
52-Week high 61.60
52-Week low 26.00
P/E 8.00
Mkt Cap.(Rs cr) 27
Buy Price 46.55
Buy Qty 8.00
Sell Price 47.05
Sell Qty 10.00
OPEN 46.90
CLOSE 46.90
VOLUME 2002
52-Week high 61.60
52-Week low 26.00
P/E 8.00
Mkt Cap.(Rs cr) 27
Buy Price 46.55
Buy Qty 8.00
Sell Price 47.05
Sell Qty 10.00

Vippy Spinpro Ltd. (VIPPYSPINPRO) - Director Report

Company director report

Dear Shareholders

Your Directors have pleasure in presenting the 24th Annual Report togetherwith the Audited Financial Statement for the year ended 31st March 2016

FINANCIAL HIGHLIGHT (Rs. in Lacs)
Particulars 2015-16 2014-15
Income
Revenue from Operations 8775.98 9451.00
Other Income 65.31 74.19
Total Revenue 8841.29 9525.19
Profit before finance cost depreciation & amortization prior period expenditure and tax 721.03 846.45
Finance Costs 48.94 109.15
Depreciation and amortization expenses 215.35 261.14
Profit before prior period expenditure and tax 456.74 476.16
Less: prior period Expenditure 0.93 0.31
Profit before Tax 455.81 475.85
Less: Tax Expenses
Current Tax 172.10 184.00
Deferred Tax(Assets)/Liabilities (25.73) (33.37)
Profit for the year 309.44 325.22
Earning per equity share
Basic 5.27 5.54
Diluted 5.27 5.54

PERFORMANCE REVIEW & COMPANY AFFAIRS

During the year under review the Company’s revenue was Rs. 8841.29 lacs comparedto Rs. 9525.19 lacs for the previous year. The Profit before Tax was Rs. 455.81 lacscompared to Rs. 475.85 lacs for the previous year.The Profit After Tax was Rs. 309.44 lacscompared to Rs. 325.22 lacs for the previous year.

Your Company is engaged in the manufacturing of cotton yarn for different applicationsby Rotor Spinning. Rotor Spinning is economical since the process is very short consumesless energy and offer substantial cost benefits in the choice of raw material incomparison to Ring Spinning especially in coarse counts. The Company is also engaged ingeneration of power through Wind Mill for captive consumption.

RESERVES

There is no amount proposed to be carried to any Reserve.

DIVIDEND

With a view of conserving resources your Directors do not recommended any dividend forthe year under review.

LISTING OF THE SHARES

The Equity Shares of the Company are presently listed with Bombay Stock ExchangeLtd.(BSE). Further the Company has paid listing fees to Bombay Stock Exchange Ltd. for theyear 2016-2017.

DIRECTORS’ RESPONSIBILITY STATEMENT

In terms of provisions of section 134(3) (c) read with section 134(5) of the CompaniesAct 2013 your Directors state that:

• in the preparation of the annual accounts for the year ended 31stMarch 2016 the applicable accounting standards have been followed and there are nomaterial departures from the same;

• the Directors had 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 as at 31stMarch2016 and of the profit of the Company for the year ended on that date ;

• the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

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

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

• the Directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

DIRECTORS & KEY MANAGERIAL PERSONNEL

In accordance with the provisions of section 152 of the Companies Act 2013 and theArticles of Association of the Company Shri Mangalore Maruthi Rao Director (DIN:00775060) retires by rotation at the ensuing Annual General Meeting and being eligibleoffers himself for his re-appointment .The Board recommends his re-appointment for theconsideration of the Members of the Company at the ensuing Annual General Meeting.

A Notice has been received alongwith deposit of requisite amont from a member proposingShri Mangalore Maruti Rao as a candidature to re-appoint him as Director.

During the year under review Smt. Deepa Sudhir Mekal (DIN-05222280) has been confirmedas Director by Shareholders at previous Annual General Meeting as a Woman Director liableto retire by rotation.

Pursuant to the provisions of section 203 of the Act the key managerial personnel ofthe Company are – Shri Piyush Mutha Managing DirectorShri Mangalore Maruthi RaoWhole Time Director and Ms. Sanju Patel Company Secretary & CFO. There has been nochange in the key managerial personnel during the year.

DECLARATION BY INDEPENDENT DIRECTORS

The Company had received declaration from all the Independent Directors of the Companyconfirming that they meet criteria of independence as prescribed under section 149(6) ofthe Companies Act 2013 and Regulation 16 (b) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.

BOARD EVALUATION

Pursuant to the provisions of Companies Act2013 and regulation 17 of SEBI(ListingObligations and Disclosure Requirements) Regulations 2015 the Board has carried outperformance evaluation of its own the Board Committees and of the Independent Directors.Independent Directors at a separate meeting evaluated performance of the Non IndependentDirectors Board as whole .The manner in which the evaluation has been carried out hasbeen detailed in Corporate Governance Report.

INSURANCE

Assets of the Company are adequately insured.

SUBSIDIARIES ASSOCIATE & JOINT VENTURE COMPANIES

Company does not have any subsidiaries associates Companies & joint venturecompanies.

RELATED PARTY TRANSACTIONS

There were no contracts or arrangements entered into by the Company as defined underprovisions of section 188 of the Companies Act 2013. None of the Directors has anypecuniary relationships or transactions vis--vis the Company. The Company had adopted apolicy on Related Party Transactions & the same is displayed on the website of theCompany weblink: http://www.vippyspinpro.com/Related-Party-Transaction-Policy.pdf.

INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal financial controls with reference tofinancial transactions are properly authorized and recorded. The Company is following allthe applicable Accounting Standards for properly maintaining the books of accounts andreporting financial statements. The Internal Audit is conducted by outside auditing firmswhich evaluate the functioning and quality of internal controls and check; and providesassurance of its adequacy and effectiveness.

The Internal Audit Reports are actively reviews by the Audit Committee and adequateremedial measures if any are taken and in time. The Internal audit Reports are alsoreviews by the Board of Directors periodically.

During the year no reportable material weakness in the design or operation wereobserved.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments affecting the financial position of theCompany which has occurred between the end of the financial year of the Company i.e. 31 stMarch 2016 and the date of the Directors’ report i.e 23rd May 2016.

DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY

In today’s challenging and competitive environment strategies for mitigatinginherent risks in accomplishing the growth plans of the Company are imperative. TheCompany had adopted Risk Management Policy 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 The common risksinter alia are: Company Assets and Property Employees Foreign Currency RisksOperational Risks Non-compliance of statutory enactments Competition Risks ContractualRisks and Volatility in prices of Raw Material.

The management is however of the view that none of the above risks may threaten theexistence of the Company as robust Risk mitigation mechanism is put in place to ensurethat there is nil or minimum impact on the Company in case of any of these risksmaterialize. The risk management framework is reviewed periodically by the Board and AuditCommittee.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

In terms of Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 read with Schedule V of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015Management Discussion and Analysis Report is appended toand forms part of this Report.

CORPORATE GOVERNANCE

Your Company has always strived to maintain appropriate standards of good corporategovernance. The Report on Corporate Governance as stipulated under Regulation 34 (3) ofSEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 read with ScheduleV of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 forms partof this Report. The requisite certificate from Company Secretary in Practice confirmingcompliance of the conditions of corporate governance is attached to report on corporategovernance.

DISCLOSURES

Particulars of Loan given Investments made Guarantee given and Securities providedunder section 186 of Companies Act 2013

There are no Loans Guarantees and Investments and Securities provided which arecovered under the provisions of the Section 186 of the Companies Act 2013.

Conservation of Energy Technical Absorption and Foreign Exchange Earning & Outgo

The Particulars relating to conservation of energy technology absorption and foreignexchange earnings and outgo as required to be disclosed under section 134 (3)(m) of theCompanies Act 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 areprovided in Annexure -I to this Report.

Extract of Annual Return

Extract of Annual Return in Form MGT-9 as required under section 134 (3)(a) of theCompanies Act 2013 read with section 92(3) of the Companies Act 2013 is annexed herewithas Annexure - II to this Report.

Meeting of Directors

During the year under review our Board met Six(6) times. The details of the number ofmeetings of the Board during the year forms part of the Report on Corporate Governance.During the year under review One (1) Board meeting of Independent Directors was held.

Committees of the Board

The Board of Directors has the following committees:

1. Audit Committee

2. Stakeholders Relationship Committee

3. Nomination & Remuneration Committee

The details of the committees along with their composition number of the meetings andattendance at the meetings are provided in the Report on Corporate Governance.

Remuneration Policy

The Company has a Remuneration policy of the Company for Directors Key ManagerialPersonnel & other employee’s .The Remuneration Policy is annexed herewith asAnnexure-III to this Report.

Vigil Mechanism / Whistle Blower Policy

The Company has a Whistle Blower Policy to report genuine concerns or grievances .Thispolicy may be accessed on the Company’s website Weblink:http://www.vippyspinpro.com/Whistle-Blower-Policy.pdf .

Particulars of employees and related disclosures

Particulars of employees as required under section 197(12) of the Companies Act2013read with rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel)Rules 2014 is not applicable as no employee is covered under the said rules.

Particulars pertaining to remuneration and other details as required under section197(12) of the Act read with Rule 5(1) of Companies (Appointment and Remuneration ofManagerial Personnel) Rules2014 is annexed herewith as Annexure - IV to this Report.

GENERAL

Yours Directors state that no disclosures or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:- details relating to deposits covered under chapter V of the companies Act 2013 - Issueof shares during the year orders were passed by the Regulators or Courts or Tribunalswhich impact the going -nosignificant concern status and Company’s operations infuture.

AUDITORS & AUDITORS’ REPORT Statutory Auditors

M/s. Sodani & Co. Chartered Accountants (Firm Registration No.000880C) Auditorsof the Company will retire at the conclusion of the ensuing Annual General Meeting andbeing eligible offer themselves for reappointment. They have confirmed their eligibilityto the effect that their re-appointment if made would be within the prescribed limitsunder the Act and that they are not disqualified for re-appointment .The Board recommendstheir re-appointment to conduct audit of accounting records of the Company for the year2016-2017.

There being no reservation qualification or adverse remark in the Auditors’Report no explanation on part of the Board of Directors is called for.

Secretarial Auditor

The Board appointed M/s Shilpesh Dalal & Co. Practicing Company Secretaries toconduct Secretarial Audit for the year 2016-17.

The Secretarial Audit Report for the financial year ended 31.03.2016 is annexedherewith as Annexure-V. The Secretarial Audit Report does not contain any reservationqualification or adverse remark and no explanation on part of the Board of Directors iscalled for.

Internal Auditor

Pursuant to the Provisions of Section 138 of the Companies Act 2013 read with Rule 13of the Companies (Accounts) Rules 2014 Sri. R.K. Saklecha & Associates CharteredAccountants was appointed as an Internal Auditor of the Company for the financial year2016-17.

PREVENTION OF SEXUAL HARASSMENT POLICY

The Company has a Prevention of Sexual Harassment Policy in force in terms of SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013. Theobjective of this policy is to ensure a safe secure and friendly work environment whereemployees will deliver their best without any inhibition threat of fear. During the yearunder review there were no complaint filed pursuant to the Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013.

HUMAN RESOURCES

The Company believes that human resources are valuable assets of the Company andprovides them an environment where each employee is motivated to contribute his best toachieve the Companies objective. The Company lays great emphasis on proper management ofhuman resources and believes that this is the most important ingredient for achievingexcellence in performance and sustainable growth. The Company has a progressive HR policyfor helping employees to develop their organization skills knowledge and abilities toachieve greater efficiency. The Company is committed to nurturing enhancing and retainingtop talent through superior learning & organizational development. The IndustrialRelations of the Company with its personnel has continued to be cordial and friendlyduring the year. The Company has 101 Permanent employees on the rolls of the Company as on31.03.2016.

COMPANY POLICY FOR PROMOTION OF EMPLOYMENT OF YOUTH COMING FROM THEUNDER-PRIVILEGED/DISADVANTAGED SECTION OF THE SOCIETY

The people are recruited in the Company on the basis of their qualification/eligibilityand merits without any discrimination against their gender religion caste colourancestry marital status nationality and disability and among equally qualifiedindividuals preference are given to people from the disadvantaged groups.

The Company also conducts training programme as required from time to time forup-skilling training of employees from socially disadvantaged sections of society.

ENVIRONMENT & SOCIAL CONCERN

Your Company is committed to build business with save energy and save environment. Windenergy is a cost-effective renewable energy sources wind energy is generally recognizedas a key solution in the fight against climate change and the desire to free society fromits dependence on fossil fuels. In line of this the Company had set up the wind mill thatgenerates electricity and contributed to displace emissions from the nation’scoal-fired power plants and eliminates the nation’s major source of acid rain reducetotal emissions of CO2 and helps to reduce the spread of respiratory disease aggravatedor caused by air pollution in the country.

Your Company is committed to the sustainable use of all natural resources and minimizeswaste at source and recycle where possible. Considering the scarcity of natural resourcesthe Company continue to maintain "Rain Water Harvesting System" at the factorypremises at Dewas. The 8040 sq meters of roof area has been covered under the rain waterharvesting and approx 8550 cubic meters of water has been collected at factory premises atDewas resulting in saving water and recharging the five bore wells consequently and alsothe cost thereof. The Company is also continuing to generate electricity throughCompany’s Wind Mill situated at Dewas District Madhya Pradesh for Captiveconsumption.

Your Company continues to give top priority importance to pollution control andenvironment protection. The Company complies with various emission standards and otherenvironmental requirements as per pollution control norms.

In memory of founder Late Shri Prakash Mutha during the year Company has involved ininspirable activities in the area around the plant situated at Dewas such as giving awardsto meritorious students and distribute bicycle School Dress School Bags School Books& Education Material. Total 47 Students got such benefit during the year.

ACKNOWLEDGEMENTS

The Board of Directors of the Company wish to place on record their thanks andappreciation to all employees for their contribution to the operation of the Company. TheDirectors are thankful to the Bank for its continued support to the Company. The Directorsalso place on record their sincere thanks to the customers dealers suppliers andinvestors for their continued support co-operation and confidence in the Management ofthe Company.

For and on behalf of the Board of Directors
Piyush Mutha Mohan Lal Jain
Place: Dewas Managing Director Director
23rd May 2016 (DIN-00424206) (DIN:00395584)

Annexure-I

Details of conservation of energy technology absorption foreign exchange earnings andoutgo (a) Conservation of energy

(i) the steps taken or impact on conservation of energy a) Maintaining required 200-400 Pascal suction pressure with removing dust fan motor (3.75 kw ) in old BIR duster - Unit saving-85 unit/day
b) 7 nos. inverter drives installed in Humidication Plant No 2 for SA fan TA fan and water pump - Unit saving-550 unit/day
c) 2 nos. inverter drive installed in Humidication Plant No.1for SA Fan - Unit saving -197 unit/day
d) Atlas copco screw compressor and Elgi Make reciprocating compressor replaced by new Kaeser make compressor - Unit saving-320 unit/day
(ii) the steps taken by the company utilizing alternate sources of energy for Nil
(iii) the capital investment on conservation equipments energy Nil

(b) Technology absorption

(i) the efforts made towards technology absorption Nil
(ii) the benefits derived like product improvement cost reduction product development or import substitution Nil
(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)-
(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 Nil

(c) Foreign exchange earning and Outgo

Particulars Year ended 31.03.2016
(in Rs.)
Foreign exchange earned in terms of Actual inflows (FOB) basis 162446554
Foreign exchange outgo in terms of Actual outflows (FOB) basis 6594098

Annexure-III

REMUNERATION POLICY

TERMS OF REFERENCE OF NOMINATION AND REMUNERATION COMMITTEE

• Identify persons who are qualified to become directors and who may be appointedin senior management in accordance with the criteria laid down and recommend to the Boardtheir appointment and removal.

• Formulate the criteria for determining qualifications positive attributes andindependence of a director and recommend to the Board a policy relating to theremuneration for the directors key managerial personnel and other employees.

• Removal should be strictly in terms of the applicable law/s and in compliance ofprinciples of natural justice.

• Formulation of criteria for evaluation of Independent Directors and the Board.

• Devising a policy on the Board diversity.

• Recommend to the Board remuneration including salary perquisite and commissionto be paid to the Company’s Executive Directors on an annual basis or as may bepermissible by laws applicable.

• Recommend to the Board the Sitting Fees payable for attending the meetings ofthe Board/Committee thereof and any other benefits such as Commission if any

• Setting the overall Remuneration Policy and other terms of employment ofDirectors wherever required.

• Whether to extend or continue the term of appointment of the independentdirector on the basis of the report of performance evaluation of the independentdirectors.

CRITERIA FOR DETERMINING THE FOLLOWING

Qualifications for appointment of Directors (including Independent Directors)

• Persons of eminence standing and knowledge with significant achievements inpublic service.

• Their financial or business literacy/skills.

• Their industrial experience.

• Appropriate other qualification/experience to meet the objectives of theCompany.

• As per the applicable provisions of Companies Act 2013 Rules made there underand SEBI (Listing Obligation and Disclosure Requirements) Regulations 2015 .

The Nomination and Remuneration Committee shall have discretion to consider and fix anyother criteria or norms for selection of the most suitable candidate/s.

Positive attributes of Directors (including Independent Directors)

• Directors are to demonstrate integrity credibility trustworthiness ability tohandle conflict constructively and the willingness to address issues proactively.

• Actively update their knowledge and skills with the latest developments in theindustry market conditions and applicable legal provisions.

• Willingness to devote sufficient time and attention to the Company’sbusiness and discharge their responsibilities

• To assist in bringing independent judgment to bear on the Board’sdeliberations especially on issues of strategy performance risk management resourceskey appointments and standards of conduct.

• Ability to develop a good working relationship with other Board members andcontribute to the Board’s working relationship with the senior management of theCompany.

• To act within their authority assist in protecting the legitimate interests ofthe Company its shareholders and employees

• Independent Directors to meet the requirements of the Companies Act 2013 readwith the Rules made there under and SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015 as amended from time to time.

Criteria for appointment of KMP/Senior Management

• To possess the required qualifications experience skills & expertise toeffectively discharge their duties and responsibilities.

• To practice and encourage professionalism and transparent working environment.

• To build teams and carry the team members along for achieving thegoals/objectives and corporate mission.

• To adhere strictly to code of conduct

POLICY RELATING TO REMUNERATION OF DIRECTORS KMP & SENIOR MANAGEMENT PERSONNEL

• To ensure that the level and components of remuneration is reasonable andsufficient to attract retain and motivate Directors KMP and other employees of thequality required to run the Company successfully.

No director/KMP/ other employee is involved in deciding his or her own remuneration andthe trend prevalent in the similar industry nature and size of business is kept in viewand given due weightage to arrive at a competitive quantum of remuneration & It is tobe ensured that relationship of remuneration to the performance is clear & meetsappropriate performance benchmarks which are unambiguously laid down and communicated.

• Improved performance should be rewarded by increase in remuneration and suitableauthority for value addition in future.

• Remuneration packages should strike a balance between fixed and incentive paywhere applicable reflecting short and long term performance objectives appropriate to theCompany’s working and goals.

• Following criteria are also to be considered:-

• Responsibilities and duties;

• Time & efforts devoted; Value addition;

• Profitability of the Company & growth of its business;

• Analyzing each and every position and skills for fixing the remunerationyardstick;

• Standards for certain functions where there is a scarcity of qualifiedresources.

• Ensuring tax efficient remuneration structures.

• Ensuring that remuneration structure is simple and that the cost to the Company(CTC) is not shown inflated and the effective take home remuneration is not low.

• Other criteria as may be applicable.

• Consistent application of remuneration parameters across the organisation.

• Provisions of law with regard making payment of remuneration as may beapplicable are complied.

• Whenever there is any deviation from the Policy the justification /reasonsshould also be indicated / disclosed adequately.

REVIEW

The policy shall be reviewed by the Nomination & Remuneration Committee and theBoard from time to time as may be necessary.

Annexure-IV

Information required under Section 197 of the Companies Act 2013 read with Rule 5(1)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014

(i) The Ratio of the remuneration of each Director to the median remuneration of theemployees of the Company for the financial year 2015-16 and the percentage increase inremuneration of each Director Chief Financial Officer Chief Executive Officer andCompany Secretary of the Company in the financial year 2015-16.

Name & Designation Remuneration# of each Director & KMP for Financial Year 2015-16 % increase/ decrease in remuneration in the Financial Year 2015-16 Ratio of remuneration of each Directors to median remuneration of employees
(in Rs.)
A. Directors
Shri Piyush Mutha 6176803 13.69% 57.99:1
(Managing Director )
Shri Manglore Murthy Rao 360000 0.00% 3.38:1
(Whole Time Director)
Shri Praneet Mutha ## ## ##
(Promoter –Non-Executive Director)
Smt. Deepa Sudhir Mekal ## ## ##
(Woman Director)
Shri Mohan Lal Jain ## ## ##
(Independent Non –Executive Director )
Shri Raghuram Krishnamurthy
(Independent Non –Executive Director ) ## ## ##
Shri Subhash Kocheta ## ## ##
(Independent Non –Executive Director )
B. Key Managerial Personnel
Ms. Sanju Patel 219729 10.15 2.06:1
(Company Secretary & CFO)

# Remuneration excludes provision for gratuity

## No remuneration only sitting fee paid.

(ii) The percentage increase in the median remuneration of employees in the financialyear 2015-16 is 1.93%

(iii) The number of permanent employees on the rolls of Company

There were 101 permanent employees on the rolls of Company as on 31stMarch 2016.

(iv) The explanation on the relationship between average increase in remuneration andCompany performance: There is no direct relationship between the average increase inremuneration and Company performance.

The Company takes various things like inflation market trend and other related issueat the time of increase in remuneration of the employee. The Individual Performance isalso one of the major criteria in increase of remuneration.

(v) Comparison of the remuneration of the Key Managerial Personnel against theperformance of the Company: The total remuneration of Key Managerial Personnel (KMPs)increased from Rs.5966739 in the Financial Year 2014-15 to Rs.6756532 in Financial year2015-16 an increase of 13.24 %. This represents 0.76% of total revenue & 14.82% of theprofit (PBT) of the Company. The Company believes that the Key Managerial personnel havebeen compensated commensurate with their Knowledge experience and contributions. TheCompany takes various things like inflation market trend and other related issue at thetime of increase in remuneration of the employee.

The Individual Performance is also one of the major criteria in increase ofremuneration.

(vi) Variations in the market capitalization of the Company price earnings ratio as atthe closing date of the current financial year and previous financial year and percentageincrease or decrease in the market quotations of the shares of the Company in comparisonto the rate at which the Company came out with the last public offer:

a) The market capitalization as on 31.03.2015 was Rs. 1047.80 Lacs which was increasedto Rs. 1314.88 Lacs as on 31.03.2016

b) Price Earnings ratio of the equity shares of the Company was 3.22 as on 31.03.2015which was increased to 4.25 as on 31.03.2016.

c) Percentage increase or decrease in the market quotations of the shares of theCompany as compared to the rate at which the Company came out with the last public offer:The Company had come out with initial public offer (IPO) in 1993 at a price of 10 pershare. The closing price of the Company’s Equity share of face value of Rs.10 each/-on the BSE as on 31.03.2016 was Rs. 22.40.

The % increase in share price as on 01.03.2016 at BSE with respect to issue price was124%.

(vii) Average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration: Averagepercentile increase in the salaries of employee other than the Managerial personnel in theFinancial

Year 2015-16 was 1.93 % and the increase in the salary of the Managerial personnel was12.84 %. There is no direct relationship between the average increase in remuneration andCompany performance. The Company takes various things like inflation market trend andother related issue at the time of increase in remuneration of the employee. TheIndividual Performance is also one of the major criteria in increase of remuneration.

(viii)The comparison of the each remuneration of Key Managerial Personnel against theperformance of the Company during the Financial Year 2015-16 is as under:

Name and Designation Remuneration# of each KMP for FY 2015-16(in Rs.) % of Revenue for FY 2015-16 % of Profit(PBT) for FY 2015-16
Shri Piyush Mutha (MD) 6176803 0.70 13.55
Shri Manglore Murthy Rao (WTD) 360000 0.04 0.79
Ms. Sanju Patel (CS & CFO) 219729 0.02 0.48

#The above remuneration is inclusive of perquisites excluding provisions of Gratuity.(ix) The key parameters for any variable component of remuneration availed by theDirectors:

The Company did not provide any variable component to its directors. The bonus was paidto eligible employees other than directors as per Payment of Bonus Act 1965.

(x) The ratio of the remuneration of the highest paid Director to that of the employeeswho are not Directors but receive remuneration in excess of the highest paid Directorduring the year: Not Applicable. remuneration is as per the Remuneration Policy of theCompany:

(xi) Affirmation

Remuneration is as per the Remuneration Policy of the Company.

For and on behalf of the Board of Directors
Place: Dewas Piyush Mutha Mohan Lal Jain
23rd May 2016 Managing Director Director
(DIN-00424206) (DIN:00395584)