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Suditi Industries Ltd.

BSE: 521113 Sector: Industrials
NSE: SUDITIND ISIN Code: INE691D01012
BSE 14:13 | 19 Mar 27.95 0.25
(0.90%)
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27.20

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27.95

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27.20

NSE 05:30 | 01 Jan Suditi Industries Ltd
OPEN 27.20
PREVIOUS CLOSE 27.70
VOLUME 191
52-Week high 71.25
52-Week low 26.00
P/E 10.51
Mkt Cap.(Rs cr) 47
Buy Price 27.25
Buy Qty 200.00
Sell Price 27.95
Sell Qty 20.00
OPEN 27.20
CLOSE 27.70
VOLUME 191
52-Week high 71.25
52-Week low 26.00
P/E 10.51
Mkt Cap.(Rs cr) 47
Buy Price 27.25
Buy Qty 200.00
Sell Price 27.95
Sell Qty 20.00

Suditi Industries Ltd. (SUDITIND) - Director Report

Company director report

Dear Shareholders

The Directors have pleasure in presenting the Twenty Seventh Annual Report of theCompany together with the Audited Balance Sheet as at 31st March 2018 and theProfit and Loss Account for the year ended on that date.

Financial Results: (Standalone)

(Rs. in Lakhs)
Particulars Current Previous
Year Ended 31.03.2018 Year Ended 31.03.2017
Revenue from operations 9781.06 8156.12
Other Income 17.01 29.30
Gross income 9798.07 8185.42
Profit before Interest and
Depreciation 927.90 838.05
Finance Cost 291.23 290.49
Profit after Finance Cost 636.67 547.56
Depreciation 150.57 178.91
Profit / (Loss) before Tax 486.10 368.65
Provision for Tax 157.59 144.02
Profit / (Loss) after Tax before
extra ordinary items 328.51 224.63
Deferred Tax provision (9.96) 13.58
Comprehensive income/Net of expenses (2.50) 0.85
Net Profit 335.97 211.90
Add: Brought forward from
the previous year 1264.14 1057.34
Adjustment on account of Ind
AS requirements (3.37) (34.08)
Amount available for appropriation 1596.74 1235.16
Transfer to Securities
Premium / ESOP 60.59 28.98
Less Dividend Paid 23.60 -
Less Tax Paid on Dividend 4.80 -
Balance carried to Balance Sheet 1628.93 1264.14

Dividend:

In order to balance the growth and developmental activities of the company as well asto fulfill the aspirations of the public stakeholders the promoters decided to continuetheir support and again in writing waived their entitlement on the profit distribution inthe form of dividend if any declared by the company for the year 2017-18. Accordingly theBoard after considering all these aspects has recommended a dividend for the year underreview at the rate of Rs.0.20 per Equity Share only on the portion of the paid up equitycapital held by the public as on the record date as may be announced by the board in thisregard. However no amount has been transferred to General reserve from the profits for theyear 2017-18.

Operations:

The company in spite of difficult economic conditions has registered substantialimprovement in the overall performance during the year under review in comparison toprevious year. The company has achieved an increase of around 20% in the sales figures anda substantial increase of around 32% in the net profits before tax in comparison toprevious year. During the year the Retail division has made satisfactory progress in termsof growth in the sales and also brought down the operational losses in comparison to theprevious year. However the outlook of the Retail business is promising as the economic andmarket conditions is poised to stage significant growth in the current year. Overall thebusiness sentiment was partially affected due to various factors particularly theimplementation of GST from July 2017 since it is a new legislation and needs time tosettle down with the procedures. Global economic conditions are also still remaining weakdue to the factors like protectionist measures followed in different part of the world.The company had anticipated all these factors and taken all the necessary steps in advanceto maintain the competitive position in the market. But in spite of these the company hadto absorb some amount of the losses generated by the Retail business activities. Furthersince the company is mainly catering to the domestic market and it has a strong presencein the domestic market there is no negative slide in the sales growth. However for theimprovement of retail division the company is taking all possible measures particularlygiving major thrust in the development of product ranges in the licentiate segments likeYouWeCan and FC Barcelona as well as in the development of the marketing network in otherformats.

The company has formulated various measures to strengthen the operations of the Retaildivision to make it a more competitive business. The company is focusing more on the LargeFormat Stores (LFS) and on line sales network. Further the efforts are underway to addmore licentiate brand under the licentiate product segment. This will eventually help theRetail Division to improve their margins substantially. Finally during the year thecompany has discharged all its obligations under EPCG License issued to the company in thepast and accordingly successfully redeemed all the pending EPCG Licenses.

Issue of Fully Convertible Debentures:

During the year the company in order to promote the brand of the company and itssubsidiaries through advertisement in print and non-print media in a major way hadentered into an agreement with M/s. H.T. Media Ltd a big media group known as HindustanTimes group. The company has also executed Subscription agreement and Media agreement withM/s. H.T. Media Ltd. Accordingly the company has issued three numbers of Fully ConvertibleDebentures of Rs.1.50 crores each aggregating to Rs.4.50 crores to the M/s. H.T. MediaLimited. Necessary approval was obtained from the shareholders in their Extra OrdinaryGeneral Meeting held on 6th March 2018. The company completed the allotment on20th.March 2018 and the BSE Ltd has issued "In Principle approval"for the same.

Amendment to the Articles of Association:

In order to issue Fully Convertible Debentures to M/s. H.T. Media Limited or any othersecurities in the future the company has made necessary modification in the Articles ofAssociation of the company. The modification was not a major one as the present clause14(2) specifically mentions only "shares" instead of "Securities"which has a wider meaning and not restricted to shares only. Hence the same is suitablymodified to include all other types of securities.

Export Sales:

During the year under review there was no exports sales reported by the company as thetextile export market remained sluggish and the realizations were not attractive becauseof continued economic slowdown in almost all parts of the world. Apart from this theunhealthy competition among the leading textile goods manufacturing countries continued tohaunt the prospects for a healthy textile market and created a negative impact on theprice segment of the textile items. Because of these factors the company continued toremain focused maximum in the domestic market. However the company continued its effortsto draw the attention of fabric buyers from Bangladesh and other neighboring countries.The company is anticipating a breakthrough in its efforts to explore the possibility ofdeveloping new markets in African and Far East countries. However ultimately the positivechanges in the global economic conditions particularly in the US and European economiescan only pave the way for the growth of the global textile market. The company is makingbest efforts to establish its identity with various reputed buyers to align with theirbrands in the overseas market to promote the exports in large volume. In spite of theunfavorable trend in the global textile market the company continues to take activeparticipation in various international Fairs/exhibitions. Once the stability is brought inthe global market India can look forward to have a better market share than itscompetitors. Hence the company always looks forward to have better exports sales in termsof better unit value realization and volume. Besides this the company has the capacity tomake wide and better range of products particularly in printed and embroidery varietiesand this will certainly help the company in the long run to increase the exports businessboth in volume and value.

Licentiate Rights:

The company has at present licentiate rights with FC Barcelona and Manchester City. Thecompany has developed and produced wide range of garments under licentiate rights and theresponse from the market is very encouraging. These brand LOGOS are embossed on thegarments under licentiate rights acquired for India. The company is now a recognized namein this particular segment of garments. Based on the past experience and also taking intoaccount the strengths and weakness of these business models the company proposes as awell thought strategy to add more such licentiate arrangements. This will ensure thatthere are always some effective brands under its umbrella throughout the period to ensurethat even if some brands crosses its shell life there are other brands to take the salesbusiness forward without affecting the growth momentum of the company. Further theassociation with "YouWeCan" backed by celebrity cricketer Mr. Yuvraj Singh isalso growing very well and various products developed during the last few months willcertainly give a big boost to the company in the sales. The company is anticipating a goodoutcome from this venture in the next few years. The company is also developing othermodels on similar lines to promote the sales with better value addition.

Joint Venture:

The company has entered into a joint venture with another company M/s. Project AnushkaSharma Lifestyles Pvt. Ltd. a company promoted by celebrity actor Mrs. Anushka Sharma andher family. The object of the joint venture is to design develop and manufacture ofvarious ladies fashion and western type outfits which will be sold through various largeretail format stores and on line stores. The company is incorporated on 19th.September2017 as a private limited company in the name of M/s. SAA & Suditi Retail Pvt. Ltd andthe ownership of the company is on 50:50 partnerships where both the promoters contributedequally to the capital. The company commenced its sales business activities after thelaunch of its products on October 2017. The company has nominated two members on the boardof the Joint venture Company and equal number of members is nominated by other companyalso. The company has achieved net sales of around Rs.3 crores with net loss from thebusiness of Rs.34 lakhs. The financial results are only for the part of the yearoperations and since the company is backed by celebrity actor the company is notanticipating any difficulty in achieving the projected growth for the year 2018-19.

Expansion:

As indicated in the earlier years the management the company has not undertaken any newmajor capital projects during the year under review. Further there is no major expansionplan in the current year except some addition of balancing equipments and replacement ofold machineries and equipments. Similarly for the Retail division also the company plansfor some expansion and the same will be managed without any additional investment ofcapital nature.

Human Resources & Industrial Relations:

Human resources development plays a crucial role in the development of anyorganization. It consists of attraction retention and development of talent in asystematic manner to fulfill the requirements of the organization. The company followsvarious programs to provide focused people attention. The emphasis is mainly on thepromotion of talent internally through job rotation and job enlargement. The Industrialrelations with the employees at the Company's plant at MIDC TTC Industrial Area PawneVillage; Navi Mumbai and in the other locations continue to remain healthy and cordial.

Share capital:

The shareholders had approved the special resolution to raise the Authorised capitalfrom Rs.18 crores to Rs.25 crores. Accordingly the company has completed the complianceprocess and the authorised capital of the company stands today at Rs.25 crores. Furtherduring the current year the company has issued 218790 shares to employees under SUDITIESOP PLAN 2011 in the month of April 2018 and accordingly the subscribed issued andpaid-up capital has increased from Rs.16.67 Crores to Rs.16.98 Crores. Apart from thisduring the year under review the company has also issued Fully Convertible Debentureswhich will be converted into equity shares at a later date.

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

The company had made the first grant of options to the employees in the year 2013 underthe Suditi Employee Stock Option Plan 2011. Apart from this the company has furthergranted additional 13000 no. of options in the year February 2017. In addition to this thecompany has also made another special grant of 111605 options in the month of February2017 on the eve of Silver Jubilee year celebrations to some selected employees with longtenure as well as good record of service and contributed significantly towards the growthof the organization. Each option is equal to one share at par (Rs.10/- each) being theprice fixed for exercising the right. To facilitate the employees to exercise their rightto buy the options granted to them the Company had earlier divided the total optionsgranted on certain prescribed basis over a period of 5 years. However the same system isnow discontinued in view of modification approved by the members in the Suditi EmployeeStock Option Plan 2011 vide special resolution in the 25th. Annual GeneralMeeting. The share arising on exercise of the options shall be subject to a lock-in-periodas may be decided by the board/ committee at the time of allotment. The entire parts ofthe earlier grant has been vested till the date of 31st March 2018 barring 9600options. The revised details are as follows:

Grant no. Granted Accepted Rejected Vested Balance
No of Employees Total options (Nos.) No of Employees Total options (Nos.) No of Employees Total options (Nos.) Up to the Fourth part of Grant Exercised Lapsed vested unvested
First 83 350800 20 253200 63 97600 133670 88930 47985 106685 9600
Second 20 13000 20 13000 0 0 0 0 0 13000 0
Silver Jubilee 38 111605 38 111605 0 0 0 0 0 111605 0

The disclosure of the details is as follows:-(a) Options granted & accepted: 377805(b) The pricing formula: At par (c) Options vested: 231290

(d) Options exercised: During the year under review no employees have exercised theiroptions under the SUDITI

ESOP PLAN 2011.

(e) As there are no options exercised during the year under review no shares wereallotted.

(f) Options rejected and lapsed: 145585 (consists of 97600 options rejected and 47985options lapsed)

(g) Variation of terms of options: NA

(h) Money realized by exercise of options: Nil

(i) Total number of options in force: 240890

(j) Employee wise details of options granted to (Excluding the options alreadyexercised):

(i) Senior managerial personnel: 178575 (includes 34250 options granted to CompanySecretary & V.P. (F) and no Director is granted any options under Suditi ESOP Plan2011).

(ii) Any other employee who receives a grant in any one year of option amounting to 5%or more of option granted during that year: Nil

(iii) Identified employees who were granted option during any one year equal to orexceeding 1% of the issued capital (excluding outstanding warrants and conversions) of thecompany at the time of grant: Nil

(k) Diluted Earnings per Share (EPS) pursuant to issue of shares on exercise of optioncalculated in accordance with Accounting Standard (AS) 20 ‘Earnings per Share':Rs.1.91.

(l) Where the company has calculated the employee compensation cost using the intrinsicvalue of the stock options the difference between the employee compensation cost socomputed and the employee compensation cost that shall have been recognized if it had usedthe fair value of the options shall be disclosed. The impact of this difference onprofits and on EPS of the company shall also be disclosed: The impact on account of thiswill reduce the profits by Rs.6983735/- and accordingly on proforma basis the company'sbasic and diluted earnings would have been Rs.1.59 and Rs.1.51 respectively:

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

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

(i) Risk-free interest rate: 7.42%

(ii) Expected life: 3 years

(iii) Expected volatility: 3.15%

(iv) Expected dividend: Rs.0.50 per share

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

Particulars of Employees:

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

Meetings:

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

Board Evaluation:

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

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

A declaration by an Independent Director(s) that they meet the criteria of independenceas provided in sub-section (6) of Section 149 of the Companies Act 2013 has beensubmitted to the Board in the first Board Meeting for the year 2018-19. An independentdirector shall hold office for a term up to five consecutive years on the Board of aCompany but shall be eligible for reappointment for next five years on passing of aspecial resolution by the Company and making disclosure of such appointment in the Board'sreport.

Remuneration Policy:

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

Managerial Remuneration:

A) Details of the ratio of the remuneration of each director to the median employee'sremuneration and other details as required pursuant to Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014. (Enclosed as AnnexureII) B) Details of the every employee of the Company as required pursuant to 5(2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014. Thestatement of the name of the top ten employees in terms of remuneration drawn is given inAnnexure II). Further the statement showing the requisite information pursuant to theCompanies (Appointment of Managerial Personnel) Rules 2014 is not annexed herewith asthere are no employees covered by the rule (2)(i) (ii) & (iii).

C) Any director who is in receipt of any commission from the company and who is aManaging Director or Whole-time Director of the Company shall receive any remuneration orcommission from any Holding Company or Subsidiary Company of such Company subject to itsdisclosure by the Company in the Board's Report. Nil D) There are no disclosures to bemade as the directors(except the Chairman & Managing Director/whole time Director)are not in receipt of any remuneration or stock options other than sitting fees andreimbursement of expenses incurred for attending the meeting. The details are furnishedseparately in the corporate governance report.

Details of Subsidiary/Joint Ventures/Associate Companies:

The company has incorporated two subsidiaries in the month of March 2015. One of thesubsidiaries M/s. Suditi Design Studio Limited has commenced sales business activitieswhile the other subsidiary M/s. Suditi Sports Apparel Limited is yet to commence theirsales business operations. Further joint venture company M/ s. SAA & Suditi Retail PvtLtd. has also commenced its commercial business activities during the year under review.The details pursuant to sub-section (3) of section 129 of the Act (AOC-1) containing thesalient feature of the financial statement of a company's subsidiary or subsidiariesassociate company or companies and joint venture or ventures etc are annexed herewith inthe Notes of the Accounts (Point 49). The Company has also presented the ConsolidatedFinancial Results along with the Standalone Financial Results of the Company. TheConsolidated Financial Results are the combined performance of the Company along with itsSubsidiaries and also taking into account of the performance of the joint venture company.The details of the same are provided along with Notes to Accounts.

Summary of Sales:

(Rs. in Lakhs)
Particulars Suditi Industries Limited Suditi Design Studio Limited (Subsidiary) Suditi Sports Apparel Limited (Subsidiary) SAA & Suditi Retail Pvt. Ltd. Consolidated
Sales 9781.06 685.40 - 306.39 10383.97*
Profit 335.97 (17.64) (0.49) (34.17) 283.67**

* Consolidated sales figures are arrived net of Inter Company & Joint Venturecompany sales.

** The Consolidated profit figures include minority interest. The growth in the salesbusiness activities of the subsidiaries has a direct impact on the performance of theholding company as they also sources their part of the material requirement from theCompany at the best prevailing market rate on arms length basis. In addition to this italso increases the overall profitability of the holding company besides providing valueaddition and brand value to the Company in the Market. It enables the Company to ensurefocused attention to the certain market segment which otherwise not catered or explored bythe Company in the regular course of business.

Deposits:

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

Energy Technology and Foreign Exchange:

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

Directors & the Key Managerial Personnel:

In accordance with the provisions of section 152 of The Companies Act 2013; Chairman& Managing Director Shri. Pawan Agarwal retires by rotation in the forthcoming AnnualGeneral Meeting and being eligible offer himself for reappointment. During the year thecompany has inducted Shri. Rajagopal Raja Chinraj as additional Director and alsoappointed him as Wholetime Director subject to the approval of the members in theforthcoming 27th. Annual General Meeting and special resolution to this effect is proposedin the Notice calling 27th. Annual General Meeting. In order to maintain the compositionof the Board the company has proposed the appointment of Smt. Sanjula Sanghai as anindependent director and the resolution to this effect is included in the notice callingthe 27th.Annual General Meeting. Further the company would be inducting a Chief FinancialOfficer (CFO) internally at the appropriate time from the existing available resources totake over the functions of CFO which is now held by the Chairman & Managing Director.

Directors' Responsibility Statement:

The Directors hereby confirm: -

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

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

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

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

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

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

Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company work performed by the internal statutory andsecretarial auditors and external consultants including audit of internal financialcontrols over financial reporting by the statutory auditors and the reviews performed bymanagement and the relevant board committees including the audit committee the board isof the opinion that the Company's internal financial controls were adequate and effectiveduring FY 2017-18.

Corporate Governance:

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

Cost Audit:

In view of the new Companies (Cost Records & Audit) Rules 2014 and amendmentthereof the company is now out of the purview of the Cost Audit Report Rules.

Auditors:

Pursuant to the provisions of section 139 of the Act and the rules framed thereafterM/s. Chaturvedi & Partners Chartered Accountants were appointed as statutoryauditors of the Company for a period of 5 years from the conclusion of the Twenty SixthAnnual General Meeting to till the conclusion of the Thirty First Annual General Meetingsubject to ratification of their appointment at every Annual General Meeting. Accordinglynecessary resolution to this effect is proposed in the notice calling 27th.Annual GeneralMeeting for the approval of the members which otherwise is not mandatory in view of theamendments to the Companies Act 2013.

Secretarial Audit Report:

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

Internal Audit & Controls:

The Company had appointed M/s. Ram Agarwal & Associates as the Internal Auditor tocarry out the internal audit functions including the task of suggesting and implementingthe recommendations to improve the control environment. Their scope of work includesreview of processes for safeguarding the assets of the Company review of operationalefficiency effectiveness of systems and processes and assessing the internal controlstrengths in all areas. Internal Auditors findings are discussed with the process ownersand suitable corrective actions taken as per the directions of Audit Committee on anongoing basis to improve efficiency in operations. The term of the present InternalAuditors expired after the close of the financial year 2017-18.

Vigil Mechanism:

In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished. The Vigil Mechanism Policy has been made available to each and everystakeholder and the Company has designated two senior officials as Vigilance Officers tosupport the Vigilance Mechanism functions.

Risk management policy:

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

Extract of Annual Return:

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

Material changes and commitments if any to report affecting the financial position ofthe company which have occurred between the end of the financial year of the company towhich the financial statements relate and the date of the report: There are no suchmaterial changes and commitments to report under this head other than the issue of 218790equity shares by the Board on exercise of options by the Employees under SUDITI ESOP 2011.

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

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

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

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

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

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

Sl No Date of investment Details of Investee Amount Purpose for which the proceeds from investment is proposed to be utilized by the recipient Date of BR Date of SR (if reqd) Expected rate of return
1 01/04/15 Suditi Sports Apparel Ltd. 4 lakhs Business activities 16/01/2015 NA 1 0 %
2 01/04/15 Suditi Design Suditi Design 4 lakhs Business activity 16/01/2015 NA 1 0 %
14/03/16 do 82 Lakhs Development of Business activity 11/02/2016 NA
3 05/10/17 SAA & SUDITI Retail Pvt. Ltd. 5 lakhs Businessactivities 05/10/2017 NA 1 0 %

Particulars of contracts or arrangements with related parties:

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

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

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

Corporate Social Responsibility (CSR):

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

Transfer of amounts to Investor Education and Protection Fund:

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

Listing with Stock Exchange:

The Company confirms that it has paid the Annual Listing Fees for the year 2018-2019 tothe Bombay Stock Exchange Limited where the Company's Shares are listed. Further theproposal to list the securities of the company with National Stock Exchange Ltd will beundertaken at the appropriate time later.

Appreciation:

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

For and on behalf of the Board of Directors
Place: Mumbai PAWAN AGARWAL
Date: 08.08.2018 CHAIRMAN & MANAGING DIRECTOR

Annexure I

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

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

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

a) Conservation of Energy:

Energy conservation measures plays a significant and crucial role in the development ofany country. The company monitors and follows all the energy conservation measurespracticed in the industry and takes all possible steps to implement them in themanufacturing units of the company. Further the company also takes active part in theenvironmental improvement plan and towards this extend the company has all the monitoringequipments which will help to improve the quality of the air in the factory.

conservation of energy are followed:
1) Installation of Auto Dosing controllers.
2) Replacement of old machines with energy saving machines.
3) Effective preventive maintenance programme which helps the company to conserve the energy and to reduce the wastage of energy thereby saving in cost.
(ii) the steps taken by the company for utilizing alternate sources of energy The company is evaluating various options of installing the equipments for Solar power systems the prospects of the usage of solar energy to support heating and daytime usage of lights in the plant.
(iii) the capital investment on energy conservation equipment's The capital investments on the items installed till date are not very significant.
b) Technology absorption:
(i) the efforts made towards technology absorption There are no significant efforts made during the year in regard to technology absorption. The company continues to monitor the new developments and efforts are made to absorb considering cost benefit analysis.
(ii) the benefits derived like product improvement cost reduction product development or import substitution Up gradation of technology is mainly aimed towards quality improvement with cost benefits.
(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)- NIL
(a) the details of technology imported NIL
(b) the year of import; NIL
(c) whether the technology been fully absorbed NIL
(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof NIL
(iv) the expenditure incurred on Research and Development Insignificant

(c) Foreign exchange earnings and Outgo:

(Rs. in Lakhs)
Particulars Current Year Previous Year
(2017-18) (2016-17)
Total Foreign Exchange used 9.57 28.99
Total Foreign Exchange earned
(FOB Value) - 3.61

 

For and on behalf of the Board of Directors
Place: Mumbai PAWAN AGARWAL
Date: 08.08.2018 CHAIRMAN & MANAGING DIRECTOR
Corporate Governance: