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Gretex Industries Ltd.

BSE: 538378 Sector: Industrials
NSE: GRETEX ISIN Code: INE985P01012
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Gretex Industries Ltd. (GRETEX) - Director Report

Company director report

TO

THE MEMBERS

GRETEX INDUSTRIES LIMITED

Your Directors have pleasure in presenting their 8th Annual Report togetherwith the Audited Financial Statements of the Company for the Year ended March 31 2017.

FINANCIAL RESULTS (Amount in Rs)

Particulars March 31 2017 March 31 2016
Revenue from Operations 23819562 37192698
Other Income 729288 378952
Total Income 24548850 37571650
Profit/(Loss) before Depreciation Interest & Taxation (12919389) 10317914
Less: Depreciation & Amortization 5023896 4458562
Profit/(Loss) before taxation (19452701) 3813083
Less: Provision for taxation - 726582
Earlier Years tax - -
Deferred Tax (4749928) 657028
Profit/(Loss) after taxation (14702773) 2429473
Balance carried to Balance sheet (14702773) 2429473

OPERATIONAL REVIEW

During the year under review the Gross Revenue From Operation of the Company in thecurrent year is stood at Rs. 23819562/- as against Rs. 37192698/- in the previousyear. Loss in the current year stood at Rs. 19452701/- against Profit before Taxationof Rs. 3813083/- in the previous year. The net loss of the Company for the year underreview was placed at Rs 14702773/- as against profit of Rs. 2429473/- in the previousyear.

DIVIDEND

During the year under review your directors do not recommend any dividend due to loss.

GENERAL RESERVE

Your Company did not transfer any amount to General Reserve this year.

SHARE CAPITAL

The paid up equity capital as on March 31 2017 was Rs. 42116000/- (Rupees FourCrore Twenty One Lacs Sixteen Thousand Only). There the company has raised money by way ofoffer for sale (924000 equity shares) and initial public offer (1056000 equity shares)on NSE Emerge Platform for Rs. 184.80 Lacs and Rs. 211.20 Lacs respectively during theyear. However the Company has not issued shares with differential voting rights sweatequity shares nor has it granted any stock options.

CHANGES IN THE NATURE OF BUSINESS

There has been no Change in the nature of the business of your Company.

DEPOSITS

Your Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014.

PARTICULARS OF LOANS. GUARANTEES OR INVESTMENTS

Details of Loans Guarantees or Investments under Section 186 of the Companies Act2013 are given in the notes to the Financial Statements.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Your Company has an adequate Internal Control System commensurate with the size scaleand complexity of its operations. The scope of work includes review of process forsafeguarding the assets of the Company review of operational efficiency effectiveness ofsystems and processes and assessing the internal control strengths in all areas.

CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVES

In pursuance of the provision of Section 135 of the Companies Act 2013 the CSRprovisions are not applicable to your Company.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

The particulars of conservation of energy and technology absorption as required underSection 134(3)(m) of the Companies Act 2013 read with the Companies (Accounts) Rules2014 are not applicable to your Company.

FOREIGN EXCHANGE EARNINGS AND OUTGO

During the period under review there were no earnings from foreign exchange and outgofor the purpose of business.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

RETIREMENT BY ROTA TION

Mr. Arvind Harlalka (DIN:00494136) Director would retire by rotation at the ensuingAnnual General meeting and being eligible offers himself for reappointment.

APPOINTMENT

Mr. Alok Harlalka has been appointed as Non-Executive Director in the place of Mr.Sumit Harlalka w.e.f. 29 th July 2017

Mr. Pradeep Mertia has been appointed as Chief Financial Officer w.e.f 01stAugust 2017.

CESSATION

Mr. Sumit Harlalka Non-Executive Director has been resigned from post w.e.f 29thJuly 2017 from the Company due to his pre occupation in other business activities.

Miss. Kritika Rupda Key Managerial Personnel has been resigned from post of ChiefFinancial Officer w.e.f 1st August 2017 from the Company due to personalreason.

The Board hereby places on record its sincerest thanks and gratitude for the invaluablecontribution made by them towards the growth and development of the Company during theirtenure.

None of the Directors of the Company are disqualified as per the provisions of Section164 of the Companies Act 2013

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration from each of the Independent Directorsunder section 149(7) of the Companies Act 2013 that he/she meets the criteria ofIndependence laid down in section 149(6) of the Companies Act 2013.

FORMAL ANNUAL EVALUATION

Pursuant to the provisions of the Companies Act 2013 the Board has carried out theannual performance evaluation of its own performance the Directors individually includingthe Chairman of the Board as well as the evaluation of the Committees of the Board. Astructured questionnaire was prepared after taking into consideration inputs received fromthe Directors. The performance evaluation of the Independent Directors was also carriedout by the entire Board.

The results of the evaluation done by Independent Directors were reported to theChairman of the Board. It was reported that the performance evaluation of the BoardCommittee etc. was satisfactory. The Directors expressed their satisfaction with theevaluation process.

NUMBER OF MEETINGS OF THE BOARD

During the financial year 31st March 2017 Thirteen Board Meetings wereheld and Two Audit Committee Meetings were convened and held. The intervening gap betweenthe Meetings was within the period prescribed under the Companies Act 2013 i.e. not morethan 120 days from the previous meeting.

DIRECTORS' REMUNERATION POLICY AND CRITERIA FOR MATTERS UNDER SECTION 178

Information regarding Director's Remuneration policy and criteria for determiningqualifications positive attributes independence of a director and other matters providedunder sub-section (3) of Section 178 are provided in the Corporate Governance Report.

DIRECTOR'S RESPONSIBILITY STATEMENT

In terms of Section 134 (5) of the Companies Act 2013 the Directors would like tostate that:

In the preparation of the annual accounts the applicable accounting standards havebeen followed.

The Directors have selected such accounting policies and applied them consistently andmade judgments and estimates that were reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit or loss of the Company for the year under review.

The Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this 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 the Companyand that such internal financial controls are adequate and were operating effectively.

The Directors had devised proper system to ensure compliance with the provisions of allapplicable laws and that such system were adequate and operating effectively.

DETAILS OF SUBSIDIARY/IOINT VENTURES/ASSOCIATE COMPANIES

Your Company does not have any subsidiary/joint venture/associate companies as on date.

However during the year ended 31st March 2017 Sherwood Securities Pvt Ltdwas the associate company.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

In line with the provisions of the Section 177(9) of the Act and the revised Regulation22 of the SEBI (LODR) Regulation the Company has adopted Whistle Blower Policy as partof vigil mechanism to provide appropriate avenues to the Directors and employees to bringto the attention of the management any issue which is perceived to be in violation of orin conflict with the fundamental business principles of the Company.

This vigil mechanism provides for adequate safeguards against victimization ofemployees and directors who avail of the vigil mechanism and also provide for directaccess to the chairperson of the Audit committee in exceptional cases. The CompanySecretary is the designated officer for effective implementation of the policy and dealingwith the complaints registered under the policy.

RISK MANAGEMENT

In today's economic environment Risk Management plays a very important part ofbusiness. The main aim of risk management is to identify assess prioritize monitor andtake precautionary measures in respect of the events that may pose risks to the business.The Company is not subject to any specific risk except risks associated with the generalbusiness of the Company as applicable to the industry as a whole.

At present the Company has not identified any element of risk which may threaten theexistence of the Company.

RELATED PARTY TRANSACTIONS

During the year under review the Company had not entered into anycontract/arrangement/ transaction with related parties which could be considered materialas per listing agreement with stock exchanges. Further there are no materiallysignificant related party transactions during the year made by the Company with PromotersDirectors Key Managerial Personnel or other designated persons.

MATERIAL CHANGES AND COMMITMENTS

No significant and material changes have occurred between the end of the financial yearof the Company to which the financial statements relate and the date of the report.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS

No significant and material order has been passed by the regulators courts tribunalsimpacting the going concern status and Company's operations in future.

AUDITORS

M/s. Gupta Agarwal & Associates Chartered Accountants (FRN: 329001E) wereappointed as Statutory Auditors of the Company for a period of 4 years in the 7th AGM ofthe Company which was held on 26th September 2016 and are eligible to continue asStatutory Auditors of the Company subject to ratification by members at the forthcomingAnnual General Meeting. They have furnished a certificate confirming that ifre-appointed their re-appointment will be in accordance with Section 139 read withSection 141 of the Companies Act 2013. The members are requested to consider theratification of their continuity of appointment as Auditors of the Company and authorisethe Board of Directors to fix their remuneration.

AUDITOR S REPORT

The Auditors' Report issued by Gupta Agarwal & Associates on the FinancialStatements for the year ended 31st March 2017 does not contain anydisqualification or adverse remark which requires clarification.

SECRETARIAL AUDIT

The Board had appointed Ms. Nomita Verma Practicing Company Secretary to carry outsecretarial audit Pursuant to provision of Section 204 of the Companies Act 2013 and TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014. TheSecretarial Audit report is annexed herewith as "Annexure /".

EXTRACT OF ANNUAL RETURN

The extract of Annual Return in Form MGT-9 pursuant to Section 92(3) of the CompaniesAct 2013 and Rule 12(1) of the Companies (Management and Administration) Rules 2014 isannexed herewith as "Annexure //".

PARTICULARS OF EMPLOYEES

As required under the provisions of Companies Act 2013 and Rule 5(2) and 5(3) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 there are noemployee falling under the above category thus no information is required to be given inthe report.

CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS

The Company has complied with the corporate governance code as stipulated under SEBIListing Regulations with the Stock Exchanges. A separate section on corporate governanceunder the listing agreement along with a certificate from the auditor confirming thecompliance is annexed and forms part of this Annual report as "Annexure ///".

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN

Your Company is committed to provide and promote a safe healthy and congenialatmosphere irrespective of gender caste creed or social class of the employees. Duringthe year under review there was no case filed pursuant to the sexual harassment of Womenat workplace (Prevention Prohibition and Redressal) Act 2013.

AUDIT COMMITTEE

Details pertaining to composition of Audit Committee are included in the report onCorporate Governance. All the recommendations made by Audit Committee were accepted byBoard.

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Your Company did not have any funds lying unpaid or unclaimed for a period of sevenyears. Therefore there were no funds which were required to be transferred to InvestorEducation and Protection Fund (IEPF).

INVESTOR RELATIONS

Your Company always endeavours to keep the time of response to shareholdersrequest/grievance at the minimum. Priority is accorded to address all the issues raised bythe shareholders and provide them a satisfactory reply at the earliest possible time. TheStakeholders' Relationship Committee of the Board meets periodically and reviews thestatus of the Shareholders' Grievances. The shares of the Company continue to be traded inelectronic forum and de-materialization exists with both the depositories viz. NationalSecurities Depository Limited and Central Depository Services (India) Limited.

ACKNOWLEDGEMENT

Your Directors would like to express their sincere appreciation for the assistance andco-operation received from the financial institutions banks Government authoritiescustomers vendors and members during the year under review. Your Directors also wish toplace on record their deep sense of appreciation for the committed services by theCompany's executives staff and workers.

Registered Office: By Order of the Board of Directors
90 Phears Lane 5 th Floor For Gretex Industries Limited
Kolkata - 700 012
West Bengal
Sd/-
Place: Kolkata Arvind Harlalka
Date: 17.08.2017 Managing Director
DIN:00494136