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Monte Carlo Fashions Ltd.

BSE: 538836 Sector: Industrials
NSE: MONTECARLO ISIN Code: INE950M01013
BSE 00:00 | 18 Oct 390.65 -0.55
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394.25

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395.10

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389.00

NSE 00:00 | 18 Oct 390.85 -1.20
(-0.31%)
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394.80

HIGH

394.80

LOW

389.00

OPEN 394.25
PREVIOUS CLOSE 391.20
VOLUME 2916
52-Week high 402.00
52-Week low 175.55
P/E 11.63
Mkt Cap.(Rs cr) 810
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 394.25
CLOSE 391.20
VOLUME 2916
52-Week high 402.00
52-Week low 175.55
P/E 11.63
Mkt Cap.(Rs cr) 810
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Monte Carlo Fashions Ltd. (MONTECARLO) - Director Report

Company director report

Dear Members

Your Directors are pleased to present the Twelfth (12th) Annual Report ofthe Company along with the Audited Financial Results for the year ended March 31 2020.

1. FINANCIAL RESULTS

The Company's financial performance for the year under ended March 31 2020 issummarized below:

(Rs In Lakhs)

Particulars Current Year Previous Year
2019-2020 2018-2019
Revenue from operations 72561.32 65637.47
Other Income 1151.79 1822.85
Total Revenue from operations & other income 73713.11 67460.32
Earnings before Interest Depreciation & Tax (EBIDTA) 13594.31 11657.49
Depreciation & Amortization 3340.38 1910.01
Finance Cost 1701.01 894.61
Profit before Tax (PBT) 8552.92 8852.87
Tax Expenses/ Adjustment
1. Current Tax 2237.82 2272.37
2. Deferred Tax (53.91) 620.89
Profit after Tax (PAT) 6269.01 5959.61
Other Comprehensive Income (net of tax) (76.22) (40.61)
Total Comprehensive Income 6192.79 5919.00
Earnings Per Share (Rs) – Basic 30.24 27.46
Earnings Per Share (Rs) – Diluted 30.24 26.85

Notes:-

1. The financial statements of the Company have been prepared in accordance with IndianAccounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards)Rules 2015 as amended and presentation requirements of Division II of schedule III ofthe Companies Act 2013 (Ind AS compliant schedule III) as applicable to financialstatement.

2. Effective from 1 April 2019 the Company has adopted Ind AS 116 "Leases"applied to all lease contracts existing on 1 April 2019 using the modified retrospectivemethod along with the transition option to recognise Right-of-Use asset (ROU) at an amountequal to the Lease Liability. Accordingly comparatives for the quarter and year ended 31March 2019 have not been retrospectively adjusted. This has resulted in recognizing a ROUasset and a corresponding Lease Liability of Rs 6742.02 lakhs as at 1 April 2019. Withthe adjustment other expenses is lower by Rs 1466.88 Lakhs and depreciation andamoritsation expense and finance cost is higher by Rs 1285.06 Lakhs and Rs 634.65 Lakhsrespectively and profit before tax is lower by Rs 452.83 Lakhs.

2. PERFORMANCE REVIEW

BUSINESS OUTLOOK

Your Company being one of the leading branded apparel Company has successfully expandedits horizon by introducing new product ranges. It has created a comprehensive range ofwool and cotton cotton blended knitted and woven apparels and home furnishing throughsome of its ranges under umbrella brand name "Monte Carlo" such as LuxuriaDenim Alpha and Tweens Rock It etc. The company continues with its endeavour to build aleading branded apparel company which can fulfil all the requirements of an individual'swardrobe. Monte Carlo has successfully positioned itself as a lifestyle brand with awell-diversified product offering. Your company has started sales through the Shop-in-Shop(SIS) model as well with a focus on expansion of its retail network.

Your Company's key strength is wide and growing distribution network with a diversifiedpresence across India. The company has a presence through 2500 + MBO's & Distributors278 EBO's 566 National Chain Stores and 126 Shop-in-Shop Stores. A significantcontribution to the company's revenue comes from MBOs and franchise EBOs where the companyprimarily sell on a pre-ordered outright basis. By this business model there is nosignificant inventory risk and the company remains adequately protected from normalhazards of the branded apparel business. The Company's future growth strategy is to focusmore on Cotton & Cotton-blended apparel catering to all seasons and expansion of itsretail distribution network. While the company already has a pan-India presence it islooking to penetrate further in the western and southern regions of India as well asexpanding its product offerings in home furnishing and kids in order to reduce the overallseasonality impact.

PRODUCTION AND SALES REVIEW

During the year under review your company has registered revenue growth of around 11%backed by improved traction across all business segments. The revenue from operations hasincreased to Rs 72561.32 Lakhs from

Rs 65637.47 Lakhs achieved last year. The production of the company has been increasedfrom 3223038 pcs to 3571110 pcs during the year 2019-2020 showing an increase of10.80%.

PROFITABLITY

The Company's earnings before depreciation interest and tax for the current year is Rs13594.31 Lakhs as against

Rs 11657.49 Lakhs achieved last year. After providing for deprecation of Rs 3340.38Lakhs (previous year Rs 1910.01 Lakhs) finance cost of Rs 1701.01 Lakhs (previous yearRs 894.61 Lakhs) provision for current tax of Rs 2337.82 Lakhs (previous year Rs2272.37 Lakhs) provision for deferred tax (Rs 53.91) Lakhs (previous year Rs 620.89Lakhs) the Net Profit from the operations increased to Rs 6269.01 Lakhs ascompared to Rs 5959.61 Lakhs achieved last year. The other income of the Companyfor the said Financial Year stood at Rs 1151.79 Lakhs.

RESOURCES UTILISATION

A) Fixed assets

The Net Block as at 31st March 2020 was at Rs 15178.03 Lakhs as comparedto Rs 14855.29 Lakhs in the previous year.

B) Current assets

The current assets as on 31st March 2020 were at Rs 61334.10 Lakhs asagainst Rs 56928.82 Lakhs in the previous year.

FINANCIAL CONDITION & LIQUDITY

The Company enjoys a rating of "(ICRA) AA- (pronounced double A minus)" fromICRA Limited (ICRA) for long term borrowings and "(ICRA) A1+ (pronounced ICRA A oneplus)"for short term borrowings. Management believes that the Company's liquidity andcapital resources should be sufficient to meet its expected working capital needs andother anticipated cash requirements.

The position of liquidity and capital resources of the company is given below:- (Rsin Lakhs)

PARTICULARS 2019-20 2018-19
Cash and Cash Equivalents
Beginning of the year 3265.54 152.23
End of the year 134.43 3265.54
Net Cash generated (used) by:-
Operating activities 3655.42 12550.49
Investing activities (3034.48) 955.16
Financial activities (3752.05) (10392.34)

IMPACT OF COVID-19

The country witnessed lockdown being implemented in India in the second fortnight ofMarch 2020. There were also restrictions of varying extent across larger part of theworld due to the COVID-19 pandemic. This impacted the business operations of the Companysignificantly. Since April 21 2020 the Company started resuming operations in itsmanufacturing plants after taking requisite permissions from Government authorities.

By staying true to its purpose and its values the top-most priority for the Companywas to ensure the safety of its employees by stringent use of protective gear abiding bysocial distancing norms and taking all safety precautions. Detailed information on thesame has been included under the Management Discussion & Analysis report forming partof this Annual Report.

3. SHARE CAPITAL

The Authorized Share Capital of your Company as at 31st March 2020 standsat Rs 250000000 divided into 25000000 Equity Shares of Rs 10/- each. As at 31stMarch 2020 the Issued Subscribed and Paid-up Equity Share Capital of the Company stoodat Rs 207320640 divided into 20732064 Equity Shares of Rs 10/- each.

There was neither any issue of Equity shares with differential rights as to dividendvoting or otherwise nor grant of any stock options or sweat equity under any scheme duringthe year under review.

4. DIVIDEND ON EQUITY SHARES

Based on the Company's performance wherein it has earned a Net Profit of Rs 6269.01Lakhs your Board recommends a dividend of Rs 5/- per Equity Share of Rs 10/- each (i.e50%) for the approval of the members at the ensuing Annual General Meeting. The finaldividend on Equity Shares if declared by the members would involve a cash outflow ofaround Rs 1036.60 Lakhs.

5. TRANSFER TO RESERVES

The General Reserve of the Company stood at Rs 38086.51 Lakhs as at 31.03.2020. Duringthe year under review buy-back related expenses amounting to Rs 47.58 Lakhs have beenadjusted from General Reserve.

6. SUBSIDIARY JOINT VENTURES OR ASSOCIATE COMPANIES

Your Company does not have any Subsidiary Joint Ventures or Associate Company

7. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING FINANCIAL POSITION OF THECOMPANY OCCURRED BETWEENTHE END OFTHE FINANCIALYEARTOWHICHTHESE FINANCIAL STATEMENTSRELATE AND THE DATE OF THIS REPORT:-

There are no material changes or commitments affecting the financial position of theCompany which have occurred between the end of the financial year of the Company i.e. 31stMarch 2020 and the date of this report

8. REPORTING OF FRAUDS:

There was no instance of fraud during the year under review which required theStatutory Auditors to report to the Audit Committee and/ or Board under Section 143(12) ofAct and Rules framed thereunder.

9 . BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNELS

The Board of Directors presently consists of 12 (Twelve) Directors including a Chairman& Managing Director 4 (Four) Executive Directors 1 (One) Non Executive NonIndependent Director and 6 (Six) Independent Directors.

In terms of the provision of Section 149 of the Companies Act 2013 and Regulation 17of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 ("ListingRegulations") your Company have 3 (Three) Women Directors on the Board namely Smt.Ruchika Oswal (DIN:00565979) Smt. Monica Oswal (DIN:00566052) and Dr. Manisha Gupta(DIN:06910242).

The Board consists of a balanced profile having specialization in different fields thatenable them to address various business needs of the Company while placing very strongemphasis on corporate governance.

Directors:

There is no change in the Board of Directors of the Company during the financial year2019-2020.

Re-appointment of Independent Directors

The members at their 11th Annual General Meeting held on September 27 2019had approved the re-appointment of the Independent Directors for a second term as per thedetails mentioned below:

Name of Director Duration of Second Term
Dr. Suresh Kumar Singla 5 (five) consecutive years with effect from 27.06.2019 to 26.06.2024
Dr. Manisha Gupta 5 (five) consecutive years with effect from 27.06.2019 to 26.06.2024
Sh. Alok Kumar Misra 5 (five) consecutive years with effect from 09.08.2019 to 08.08.2024
Dr. Amrik Singh Sohi 3 (Three) consecutive years with effect from 01.02.2019 to 31.01.2022
Sh. Ajit Singh Chatha 3 (Three) consecutive years with effect from 01.04.2019 to 31.03.2022

Declaration of independence from Independent Directors

The Company has received the following declarations from all the Independent Directorsconfirming that:

• They meet the criteria of independence as prescribed under the provisions of theAct read with the Schedules and Rules issued thereunder as well as of Regulation 16 ofthe Listing Regulations.

• In terms of Rule 6(3) of the Companies (Appointment and Qualification ofDirectors) Rules 2014 they have registered themselves with the Independent Director'sdatabase maintained by the Indian Institute of Corporate Affairs Manesar.

• In terms of Regulation 25(8) of the Listing Regulations they are not aware ofany circumstance or situation which exist or may be reasonably anticipated that couldimpair or impact their ability to discharge their duties. In terms of Regulation 25(9) ofthe Listing Regulations the Board of Directors has ensured the veracity of thedisclosures made under Regulation 25(8) of the Listing Regulations by the IndependentDirectors of the Company.

Retirement by Rotation

In accordance with the provisions of Section 152(6) of the Companies Act 2013 Smt.Ruchika Oswal (DIN: 00565979) and Smt. Monica Oswal (DIN: 00566052) Executive Directorsof the Company being longest in the office since their last appointments/re-appointments shall retire at the forthcoming Annual General Meeting and being eligibleoffers themselves for re-appointment on the same terms and conditions on which they wereappointed/ re-appointed.

In compliance with Regulation 36 of Listing Regulations and Secretarial Standards briefresumes of all the Directors proposed to be appointed / re-appointed are attached alongwith the Notice calling the ensuing Annual General Meeting.

Key Managerial Personnel (KMP's)

The following persons are the Key Managerial Personnel (KMP's) of the Company as onMarch 31 2020 in terms of provisions of Section 203 of the Companies Act 2013 and rulesmade there under:

Names of KMP's Designation
Sh. Jawahar Lal Oswal Chairman & Managing Director
Sh. Sandeep Jain Executive Director
Smt. Ruchika Oswal Executive Director
Smt. Monica Oswal Executive Director
Sh. Rishabh Oswal Executive Director
Sh. Raj Kapoor Sharma Chief Financial Officer
Sh. Ankur Gauba* Company Secretary

*Sh. Ankur Gauba was appointed as Company Secretary & Compliance Officer witheffect from 20th May 2019.

10. NUMBER OF BOARD MEETINGS HELD

The Board meets at regular intervals to discuss and decide on policy and strategy apartfrom other business discussions. However in case of a special and urgent business needthe Board's approval is taken by passing resolution(s) through circulation as permittedby law which is confirmed in the subsequent Board Meeting.

During the Financial Year 2019-2020 the Board met on 4 (Four) occasions viz. May 202019; August 05 2019; November 13 2019 and February 06 2020. The intervening gapbetween the meetings was within the period prescribed under the Companies Act 2013.

11. COMMITTEES OF THE BOARD

The Company has constituted the following committees in compliance with the CompaniesAct 2013 and the Listing Regulations.

1. Audit Committee;

2. Nomination and Remuneration Committee;

3. Stakeholders Relationship Committee and

4. Corporate Social Responsibility Committee.

Apart from the aforesaid Committees of the Board the Company has also constitutedShare Transfer Committee. All these Committees have been established as a part of the bestcorporate governance practices. There have been no instances where the Board has notaccepted any recommendation of the aforesaid Committees. The details in respect to theCompositions Powers Roles and Terms of Reference etc. are provided in the CorporateGovernance Report forming part of this Report.

12. ANNUAL BOARD EVALUATION

Pursuant to the provisions of the Companies Act 2013 the Board has carried out anannual evaluation of its own performance that of its committees and individual directors.Further the Independent Directors of the Company met once during the year on November 132019 to review the performance of the Non-executive Directors Chairman of the Company andperformance of the Board as a whole. Composition of Board / Committees Quality and timelyflow of information frequency of meetings and level of participation in discussions weresome of the parameters considered during the evaluation process.

13. NOMINATION AND REMUNERATION POLICY

The Nomination and Remuneration Policy adopted by the Company lays down a framework inrelation to selection appointment/ reappointment of Directors Key Managerial Personneland Senior Management alongwith their remuneration. It also lays down criteria fordetermining qualifications positive attributes independence of director(s) and othermatters provided under sub section (3) of section 178 of the Companies Act 2013.

The said Policy is available on Company's website and the web link for the same ishttps://www.montecarlocorporate.com/ Pdfs/NOMINATION_AND_REMUNERATION_POLICY1574676567.pdf

14. PUBLIC DEPOSIT

During the year under review your Company has not accepted any deposits as envisagedunder Section 73 of the Companies Act 2013 and rules made there under.

15. INTERNAL FINANCIAL CONTROL AND ITS ADEQUACY

Your Company has an adequate system of internal financial control commensurate with itssize and scale of operations procedures and policies ensuring orderly and efficientconduct of its business including adherence to the Company's policies safeguarding ofits assets prevention and detection of frauds and errors accuracy and completeness ofaccounting records and timely preparation of reliable financial information.

Based on the framework of Internal Financial Controls and compliance systemsestablished and maintained by the Company work performed by the Internal AuditorsStatutory Auditors and Secretarial Auditors and External Consultants including audit ofinternal financial controls over financial reporting by the Statutory Auditors and thereviews performed by the management and the Audit Committee the Board is of the opinionthat Internal Financial Controls of the Company were adequate and effective during theyear under review.

16. BUSINESS RISK MANAGEMENT

Pursuant to Section 134(3)(n) of the Companies Act 2013 your management at regularintervals evaluates various risks faced by the Company which could affect its businessoperations or threaten its existence. Major risks identified by the businesses andfunctions from time to time are systematically addressed through mitigating actions on acontinuing basis.

17. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Your Board has constituted a CSR Committee constituted under Section 135 of theCompanies Act 2013. As per the adopted CSR policy the Company is committed to certainCSR initiatives in the fields of Medical Relief and Research EnvironmentalSustainability Education and Social Upliftment etc. in collaboration with its GroupCompanies through the Implementing Agency i.e Oswal Foundation and othertrusts/organisations. The said policy is available at https://www.montecarlocorporate.com/Pdfs/CORPORATE-SOCIAL-RESPONSIBLITY-POLICY1574676509.pdf TheCompany was required to spend Rs 162.48 Lakhs on account of its liability towardsCorporate Social Responsibility (CSR) for the Financial year 2019-20 and the Company hasfulfilled its entire CSR obligation by donating Rs 1.05 Lakhs to Deaf Cricket Federationand Rs 161.43 Lakhs to Oswal Foundation thus complying with the provisions of section 135of the Companies Act2013.

The Annual Report on CSR activities as required under Companies (Corporate SocialResponsibility Policy) Rules 2014 including a brief outline of the Company's CSR Policyis set out as Annexure-A forming part of this Report.

18. RELATED PARTY TRANSACTIONS

All the transactions entered into by the Company with its related parties during theyear under review were in the "ordinary course of the business" and on "anarm's length basis" none of which was "material" in accordance with theCompany's Related Party Transactions Policy. Accordingly the disclosure of Related PartyTransactions as required under Section 134(3)(h) of the Companies Act 2013 in Form AOC-2is enclosed as Annexure-B. Further there are no materially significant relatedparty transactions made by the Company with Promoters Key Managerial Personnel or otherdesignated persons which may have potential conflict with interest of the Company atlarge.

Prior approval of the Audit Committee was also obtained for all the transactionsentered into during the year 2019-20 by the Company with its Group Companies. The detailsof all the related party transactions were placed before the Audit Committee and Board forits consideration and ratification on quarterly basis.

The details of the transactions entered with Related Parties during the year areprovided in the Company's Financial Statements at Note No. 40 of the Notes to Accounts inaccordance with the relevant Accounting Standard.

Your Company has framed a Policy on Related Party Transactions for purpose ofidentification and monitoring of such transactions in line with the requirements of theCompanies Act 2013 and Listing Regulations and the said policy is available athttps://www.montecarlocorporate.com/Pdfs/RELATED-PARTY-TRANSACTION-POLICY1574676627.pdf.

19. PARTICULARS OF LOANS GUARANTEE OR INVESTMENTS

The Company has not given any loan guarantee or made any investment covered under theprovisions of Section 186 of the Companies Act 2013. However the detail of investmentsmade by the Company is given in the notes to the Financial Statement.

20. EXTRACTS OF ANNUAL RETURN

Pursuant to the provisions of Section 134(3)(a) of Companies Act 2013 substituted byCompanies (Amendment) Act 2017 w.e.f. July 31 2018 the Annual Return is put up on theCompany's website and can be accessed at https://www.montecarlocorporate.com/Pdfs/Annual%20Return%202019-201598869177.pdf

21. INSURANCE

Your Company has taken adequate comprehensive insurance policy for its assets againstforeseeable perils like fire flood public liability marine etc.

The Company has also taken Directors and Officers Liability insurance policy.

22. INTERNAL CONTROL SYSTEM & ITS ADEQUACY

Your Company has developed a well defined Internal Control System commensurate with thesize scale and complexity of its operations. The internal audit function is entrusted toM/s Gupta Vigg & Co. Chartered Accountants who were appointed as Internal Auditorsby the Board in terms of Section 138 of the Companies Act 2013 and rules made thereunder. The Internal Auditors monitors and evaluates adequacy of internal control system inthe Company its compliance with operating systems accounting procedures and policies ofthe Company. Significant audit observations are addressed to the Audit Committee and theCommittee thereafter reviews the adequacy and effectiveness of the internal controlsystems and suggests various measures to improve and strengthen the same.

23. CORPORATE GOVERNANCE

The Company is committed to follow the best Corporate Governance practices includingthe requirements under the SEBI Listing Regulations and the Board is responsible to ensurethe same from time to time. The Company has duly complied with the Corporate Governancerequirements. Further a separate section on Corporate Governance in compliance with theprovisions of Regulation 34 of the Listing Regulations read with Schedule V of the saidregulations alongwith a Certificate from a Practicing Company Secretary confirming thatthe Company is and has been compliant with the conditions stipulated under SEBI (ListingObligations and Disclosure Requirements) Regulation 2015 forms part of the Annual Report.

24. AUDITORS

Statutory Auditors & Auditor's Report

The Board has proposed the resolution of appointment of M/s Walker Chandiok & Co.LLP (Firm Registration No: 001067N / N500013) as Statutory Auditors for the approval ofthe members of the Company in their ensuing Annual General Meeting to hold office for aperiod of 2 years commencing from the conclusion of 12th (Twelfth) AnnualGeneral Meeting till the conclusion of 14th (Fourteenth) Annual General Meetingof the Company.

The Company has obtained from Auditors a written consent and a certificate as requiredunder the Section 139 of the Companies Act 2013 to the effect that their reappointmentif made would be within the limits and in accordance with the criteria specified underSection 141 of the Companies Act 2013.

The Auditor's Report on the Annual Accounts of the Company for the year under review isself explanatory and requires no comments. Further there are no adverse remarks orqualification in the report that calls for Board's explanation. During the year underreview there were no frauds reported by Auditors under Section 143(12) of Companies Act2013.

Secretarial Auditor

M/s P.S. Dua & Associates Company Secretary in whole time practice were appointedas Secretarial Auditor of the Company to conduct Secretarial Audit for the Financial Year2019-20 pursuant to the provisions of Section 204 of the Companies Act 2013 andCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014. There hasbeen no qualification reservation adverse remark or disclaimer given by the SecretarialAuditor in his Report for the year under review. The Secretarial Audit Report is annexedas Annexure-C to this report.

Cost Auditor

In terms of the Companies (Cost Records and Audit) Amendment Rules 2014 the Companyis not covered under the purview of Cost Audit.

25. LISTING OF EQUITY SHARES

The Equity Shares of the Company are listed on BSE Limited (BSE) and National StockExchange of India Limited (NSE) Mumbai and the listing fees for the Financial Year2019-2020 have been duly paid to both the Stock Exchanges.

26. VIGIL MECHANISM/ WHISTLE BLOWER POLICY

The Company has formulated a Vigil Mechanism/ Whistle blower Policy to encourageemployees to report matters about unethical behaviour actual or suspected fraud orviolation of Company's code of conduct without the risk of subsequent victimisation anddiscrimination. The details of the same are explained in the Corporate Governance Reportand the said policy is also posted on the website of the Company i.e.www.montecarlocorporate.com.

27. DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND

REDRESSAL) ACT 2013

The Company has adopted a policy against sexual harassment and constituted an InternalCompliant Committee in line with the provisions of Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 and the rules framed thereunder. Duringthe Financial Year 2019-20 the Company has not received any complaints on the same andhence no complaint was pending as at 31st March 2020.

28. MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT

Management's Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34(3) read with Schedule V of the Listing Regulations is presentedseparately and forms part of this Annual Report.

29. BUSINESS RESPONSIBILITY REPORT

Business Responsibility Report ("BRR") for the year under review asstipulated under 34(2)(f) of the SEBI Listing Regulations to be submitted by top 1000listed entities based on their market capitalisation as on March 31 2020 is presentedseparately and forms part of this Annual Report.

30. DISCLOSURE OF REMUNERATION OF DIRECTORS AND EMPLOYEES OF THE COMPANY

Information as required under Section 197(12) of the Companies Act 2013 read with Rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014and a statement showing the names and other particulars of the employees drawingremuneration in excess of the limits set out in Rule 5(2) and 5(3) of the Companies(Appointment & Remuneration of Managerial Personnel) Rules 2014 is annexed hereto as Annexure-Dand forms part of this report.

31. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO

The information on Conservation of Energy Technology Absorption and Foreign ExchangeEarnings and Outgo pursuant to Section 134(3)(m) of the Companies Act 2013 read withRule 8(3) of the Companies (Accounts) Rules 2014 is annexed as Annexure-E.

32. COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD AND GENERAL MEETINGS

During the year under review your Company has duly complied with the applicableprovisions of the Secretarial Standards.

33. HUMAN RESOURCE & INDUSTRIAL RELATIONS

During the year under review your Company enjoyed cordial relationship with theworkers and employees at all levels of the organisation. A detailed section on HumanResources/Industrial Relations is provided in the Management Discussion and AnalysisReport which forms part of this Annual Report.

34. DIRECTOR'S RESPONSIBILITY STATEMENT

In compliance of Section 134(3)(c) of the Companies Act 2013 it is hereby confirmedthat: a) In the preparation of the annual accounts for the year ended March 312020 the applicable accounting standards have been followed along with proper explanationrelating to material departures;

b) 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 of the Company for that period;

c) The directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;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 have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems are adequate and operatingeffectively.

35. GENERAL DISCLOSURES

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. Significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.

2. Transfer of unclaimed / unpaid dividend to Investor Education and ProtectionFund.

3. Change in nature of Business of Company

36. ACKNOWLEDGEMENT & APPRECIATION

Your Board is grateful to express its deep sense of gratitude and appreciation to allthe Shareholders Customers Vendors Bankers Financial Institutions and BusinessAssociates of the Company for their continued support during the relevant financial year.Your Board acknowledges support and cooperation received from all the regulatoryauthorities of the Central Government and State Government respectively.

It also express its sincere appreciation of the employees at all levels for beingencouraged to meet several challenges encountered and look forward to their valuablesupport and commitment in the times ahead.

For and on behalf of Board of Directors
Jawahar Lal Oswal
Place: Ludhiana Chairman & Managing Director
Date : 07.08.2020 (DIN: 00463866)

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