DEAR MEMBERS

Your Directors have pleasure in presenting 30^th Annual Report for thefinancial year 2020-21 along with Audited Balance Sheet and the Statement of Profit andLoss Account for the year ended on March 31 2021.

FINANCIAL RESULTS

The financial performance of your Company for the year ended March 31 2021 issummarized below: (Rs. in lakhs)

DIVIDEND

In view of losses your Directors do not recommend any Dividend for the year underreview.

All the unclaimed / unpaid dividends lying with the Company are transferred to InvestorEducation Protection Fund.

RESERVES

No amount has been proposed to carry to Reserves.

PRODUCTS & BUSINESS

The Company's main business is of manufacturing speciality adhesive tapes and plasticropes.

CODE OF CONDUCT

All Board Members and Senior Management Personnel have affirmed compliance with theCode of Conduct for the year 202021. A declaration to this effect as required underregulation 26(3) read with Schedule V (D) of the SEBI (Listing Obligation and DisclosureRequirements) Regulation 2015 ("Listing Regulations") from the ManagingDirector of the Company is given below to this report.

A Declaration signed by the Managing Director is given below:

I hereby confirm that:

The Company has obtained from all the members of the Board and senior managementaffirmation that they have complied with Code of Conduct and ethics for the Director andSenior Management in respect of the Financial Year 2020-21.

Sandeep Arora

DIN: 00176939

DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

In accordance with the provisions of the Companies Act 2013 ("the Act") andthe Articles of Association of the Company Mrs. Mridu Arora Director (DIN: 07260461) isliable to retire by rotation and being eligible offers herself for re-appointment at theensuing Annual General Meeting.

The Independent Directors of your Company have submitted a declaration confirming thateach of them meets the criteria of independence as laid down under Section 149(6) of theAct and Regulation 16(1)(b) of the Listing Regulations and there has been no change in thecircumstances which may affect their status as Independent Director during the year.

Ms. Meena Dodmani Company Secretary and Key Managerial Personnel (KMP) of the Companyresigned with effect from 9^th February 2021 and Ms. Anuradha Dubey Member ofInstitute of Company Secretaries of India was been appointed as Company Secretary and KMPwith effect from 8^th June 2021.

The Composition of the Board and KMP as on date is as under:

(1) Mr. Sandeep M. Arora - Managing Director (KMP)

(2) Mrs. Mridu Arora - Non-executive Director

(3) Mr. Manish Nanda - Non-executive Independent Director

(4) Mr. Nitin Rane - Non-executive Independent Director

(5) Mr. Ajeet Singh - Chief Financial Officer (KMP)

(6) Ms. Anuradha Dubey - Company Secretary (KMP)

The following policies of the Company are put up on the Website of the Company at theweblink http://www.sonal.co.in/financial-info/default.php

a) Policy for selection of Directors and determining Directors independence; and

b) Remuneration Policy for Directors Key Managerial Personnel and other employees.

VARIOUS COMMITTEES OF THE BOARD AND THEIR COMPOSITIONS

NUMBER OF MEETINGS OF THE BOARD

During the FY 2020-21 Six meetings of the Board of Directors were held.

BOARD EVALUATION

The Board of Directors has carried out an Annual Performance Evaluation for all BoardMembers as well as the working of the Board and its Committees pursuant to the provisionof Act and Listing Regulations. The performance of the Board was evaluated by the Boardafter seeking inputs from all the Directors on the basis of the criteria such as the Boardcomposition and structure effectiveness of Board processes information and functioningetc.

The performance of the Committees was evaluated by the Board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.

The Board and the Nomination and Remuneration Committee ("NRC") reviewed theperformance of the individual Directors on the basis of the criteria such as thecontribution of the individual Director to the Board and Committee meetings likepreparedness on the issues to be discussed meaningful and constructive contribution andinputs in meetings etc. In addition the Chairman was also evaluated on the key aspectsof his role.

In a separate meeting of Independent Directors performance of non-independentDirectors performance of the Board as a whole and performance of the Chairman wasevaluated. The same was discussed in the Board meeting that followed the meeting of theindependent Directors at which the performance of the Board its committees andindividual Directors was also discussed.

DIRECTORS' RESPONSIBILITY STATEMENT

Your Directors state that:

a) in the preparation of the annual accounts for the year ended March 31 2021 theapplicable accounting standards have been followed and there are no material departuresfrom the same;

b) the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2021 and of the Profit /Loss of the Company for the year ended on that date;

c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets 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 the provisionsof all applicable laws and that such systems are adequate and operating effectively.

ANNUAL RETURN

The Annual Return of the Company as on 31st March 2021 in Form MGT - 7 in accordancewith Section 92(3) of the Act read with the Companies (Management and Administration)Rules 2014 is available on the website of the Company athttps://www.sonal.co.in/financial-info/Form_MGT_7.pdf

INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operation was observed.

STATUORY AUDITORS

Pursuant to provisions of Section 139 of the Companies Act 2013 read with theCompanies (Audit and Auditors) Rules 2014 M/s. M C Asawa & CO Chartered Accountant(Firm Registration No: 008041C) were appointed as the Statutory Auditors for a period offive years from the conclusion of 29th Annual General Meeting till the conclusion of the34th Annual General Meeting to be held in the year 2025.

The Auditors' Report to the Members on the Accounts of the Company for the year endedMarch 31 2021 is a part of the Annual Report.

Auditors Emphasis/Remarks/Observations in the Audit Report for the year ended31.03.2021:

a) With reference to qualifications no. i - The bank has not disclosed the details ofinterest and hence it is not feasible for the management to estimate the impact. Themanagement is following up with SBI.

b) With reference to qualifications no. ii - The bank has not provided the Bankstatements owing to NPA hence it is not feasible for the management to reconcile thesame. The management is following up with SBI.

c) With reference to qualifications no. iii & iv - The matters are under disputeand are pending before the different courts / tribunals.

d) With reference to qualifications no. v- Continuous follow up are going on withdebtors and creditors and the same are in settlement process hence not written off.

e) With reference to qualifications no. vi - The matter is pending before High Courtand / or Debt Recovery Tribunal.

f) With reference to qualifications no. vii & viii - The Company is in process ofidentifying various opportunities to generate funds for growth and expansions.

Reporting of Frauds

During the year under review the Auditors have not reported any instance of fraudcommitted in the Company by its Officers or Employees to the Audit Committee under section143 (12) of the Companies Act 2013.

SECRETARIAL AUDITOR

Pursuant to the provisions of section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed Mr. Prashant Diwan Company Secretary in Whole-Time Practice to conductSecretarial Audit for the financial year 2020-21. The Secretarial Audit Report given bythe Secretarial Auditor is annexed to this Board Report as Annexure I. The SecretarialAudit Report in unqualified.

DEPOSITS

During the year the Company has not accepted any Deposits from the Public. The Companyhas taken a loan from Director of the Company amounting to Rs. 2000000/- as detailed inNote 34 of the Financial Statements. The Company has taken a declaration from the Directorthat the amount is given out of his own funds and not acquired from others.

PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIES PROVIDEDUNDER SECTION 186 OF THE COMPANIES ACT 2013

The Company has not given any loans or made any investments in other bodies corporateduring the year. However the Company had given Corporate Guarantees of Rs. 38262938/-in earlier years which is within limit specified under section 186 of the Act.

COST RECORDS

The cost records as prescribed under sub-section (1) of section 148 of the CompaniesAct 2013 is not applicable to the company.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

All Related Parties Transactions entered by the Company during the Financial Year2020-21 were in the ordinary course of business and on an arm's length pricing basis. Thedetails of Related Parties Transactions are given in Note 34 in Notes to Accounts of theFinancial Statements for the year ended March 31 2021.

The Related Party Transactions policy as approved by the Board of Directors isdisclosed on the Company's website at the web linkhttp://www.sonal.co.in/financial-info/SAL-RELATED-PARTY-TRSC.pdf.

SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES

Your Company does not have any Subsidiary Joint Venture and Associate Company.

The Company is Associate of Sonal Impex Limited.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclosed under the Act are provided inAnnexure II to this Report.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

The particulars of employees required to be furnished pursuant to Section 197(12) ofthe Act read with Rule 5 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is annexed herewith as Annexure III to this Report. However asper the provisions of Section 136 of the Act the Annual Report is being sent to allMembers of the Company.

During the year under review none of the employees of the Company was in receipt ofremuneration aggregating Rs. 10200000/- or more per annum if employed throughout theyear or Rs. 850000/- or more per month in case employed for part of the year. Hencethere are no particulars to be annexed to this report as required under sub-rules 2 and 3of Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014.

CORPORATE GOVERNANCE

The Company is committed to good Corporate Governance in line with Listing Regulation.However since the Net worth and paid up capital of the Company is below Rs. 25 Crores andRs. 10 Crores respectively the Regulation 27 and Para C D and E of Schedule V of theListing Regulations are not applicable and hence Corporate Governance Report does notforms part of the Annual Report.

MANAGEMENT DISCUSSIONS AND ANALYSIS

Pursuant to Regulation 34 read with Schedule V of the Listing Regulations a brief noteon Management Discussions and Analysis of the results for the year under review is givenin Annexure IV which forms part of the Directors' Report.

CORPORATE SOCIAL RESPONSIBILITY STATEMENT (CSR)

The provisions of Section 135 of the Act regarding Corporate Social Responsibility arenot applicable to the Company as the Company is not falling under the said parameters.

VIGIL MECHANISM

The Vigil Mechanism of the Company which also incorporates a Whistle Blower Policy interms of the Listing Regulations includes an Ethics & Compliance Task Forcecomprising Senior Executives of the Company. Protected disclosures can be made by aWhistle Blower through an e-mail or dedicated telephone line or a letter to the TaskForce or to the Chairman of the Audit Committee.

Your Company hereby affirms that no Director/ employee have been denied access to theChairman of the Audit Committee and that no complaints were received during the year.

The Policy on vigil mechanism and whistle blower policy is available on the Company'swebsite at web link http://www.sonal.co.in/financial-info/SAL-VIGIL-MECHANISM.pdf.

SECRETARIAL STANDARDS

The applicable Secretarial Standards i.e. SS-1 and SS-2 relating to 'Meetings of Boardof Directors' and 'General Meeting' respectively as issued by the Institute of CompanySecretaries of India (ICSI) have been duly complied by your Company.

SEXUAL HARASSMENT

The Company has complied and constituted Internal Complaints Committee under the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 exceptfor appointment of a Member in the Committee who is amongst NGO/associations. Furtherduring the year under review there were no cases filed pursuant to the Sexual Harassmentof Women at Workplace (Prevention Prohibition and Redressal) Act 2013.

GENERAL

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. No material changes and commitments affecting the financial position of the Companyoccurred between the end of the Financial Year to which this financial statements relateon the date of this report except that the Account of the Company is declared NonPerforming Asset by State Bank of India and the said loan has been now assigned to ASREC(India) Limited.

2. The Company does not have any Risk Management Policy as the element of riskthreatening the Company's existence is very minimal.

3. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.

ACKNOWLEDGEMENT

Your Directors take this opportunity to thank all employees of the Company for theirhard work dedication and commitment and appreciate the co-operation received from theBankers and other Government authorities during the year under review.