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Tirupati Forge Ltd.

BSE: 535021 Sector: Engineering
NSE: TIRUPATIFL ISIN Code: INE319Y01016
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Tirupati Forge Ltd. (TIRUPATIFL) - Director Report

Company director report

Dear Fellow Share Owners TIRUPATI FORGE LIMITED

FINANCIAL RESULTS

Your Directors have pleasure in presenting 6th Annual Report along with theAudited Standalone Financial Statements for the year ended on March 31 2018.

The Financials of the Company for the year ended on March 31 2018 is summarized asunder:

(Amount in Rs.)

Particulars F.Y. 2017-18 F.Y. 2016-17
1. Revenue from Operations 207907254 160999515
2. Other Income 1281770 1934550
3. Total Revenue 209189024 162934065
4 Cost of Materials Consumed 117965703 97875925
5. Purchase of Stock in Trade 1728193 0
6. EXPENSES
Changes in inventories (170154) (1405675)
Work In Progress & By Products Finished goods (10314125) (1500605)
7. Employees Benefit Expenses 11439773 7456265
8. Finance Costs 2577292 4690977
9. Depreciation and Amortization Expenses 8780699 8964860
10. Other Expenses 55871689 39741880
11. Total Expenses 187879071 155823626
12. Profit Before Tax 21309953 7110439
13. Tax Expenses
Current Tax 6259972 2325000
Deferred Tax (402600) (157900)
14. Total Tax Expenses 5857372 2167100
15. Profit After Tax 15452581 4943339
16. Earnings Per Share (EPS) 3.57 1.97

OPERATIONAL RESULTS AND STATE OF COMPANY'S AFFAIRS

The Highlights of Company's performance for the year ended on March 31 2018: TotalRevenue from Operations increased from Rs. 160999515/- of previous F.Y 2016-17 to Rs.207907254/- of the reporting financial year.

• Total Expenses has increased from Rs. 155823626/- of previous financial yearto Rs. 187879071/- of the reporting financial year.

• Profit before exceptional & extra-ordinary items and tax increased from Rs.7110439/- of previous F.Y. 2016-17 to Rs. 21309953/- of reporting financial year.

• Net Profit increased by from Rs. 4943339/- of previous F.Y. 2016-17 to Rs.15452581/- of reporting financial year.

• Earnings per Share (EPS) for the F.Y. 2017-18 is Rs. 3.57/- as compared to Rs.1.97/- of F.Y. 2016-17.

FINANCIAL PERFORMANCE REVIEW AND ANALYSIS

During the year under Report the Company came up with Initial Public Offer (IPO) andlisted its Equity Shares on Emerge Platform of National Stock Exchange of India Ltd. (NSEEMERGE) on Thursday October 12 2017. The Company has used the proceeds received fromInitial Public Offer (IPO) for repayment of Term Loan and other general corporate purposeand meeting of issue expenses.

Report under review projected Total Revenue of Rs. 209189024/- for the year ended onMarch 31 2018 as compared to Rs. 162934065/- for the previous financial year 2016-17which shows an approximate increase of 28.39%. The Total Expenditure includingdepreciation incurred during the year is Rs. 187879071/- as against the amount of Rs.155823626/- during previous financial year. The Company has earned Net Profit of Rs.15452581/- in the financial year under review while Net Profit for the previousfinancial year was recorded at Rs. 4943339/-. During F.Y. 2017-18 the Net Profit of theCompany has increased by 212.59% approximately.

DECLARATION OF DIVIDEND AND TRANSFER TO RESERVES

With a view to plough back of profits and using Net Profit for liquidity purpose andday-to-day operational activities your Board of Directors does not recommend any dividendfor the F.Y. 2017-18. Further no amount has been transferred to the Reserves during theyear under review.

CHANGE IN THE NATURE OF BUSINESS

During the year your Company has not changed its business or object and continues tobe in the same line of business as per main object of the Company

SHARE CAPITAL

Authorised Share Capital

During the year under review the Company has increased its Authorised Share Capital FROMRs. 8000000/- (Rupees Eighty Lacs Only) divided into 800000 (Eight Lacs) EquityShares of Rs. 10/-(Rupees Ten) each TO Rs. 70000000/- (Rupees Seven Crore Only)divided into 7000000 (Seventy Lacs) Equity Shares of Rs. 10/- (Rupees Ten) each bypassing an Ordinary Resolution at an ExtraOrdinary General Meeting of the Members of theCompany which was held on Thursday June 8 2017 at the Registered Office of the Company.

Paid-Up Share Capital

The paid-up Share Capital of the Company has been increased FROM Rs. 7850000/-(Rupees Seventy Eight Lacs and Fifty Thousand Only) divided into 785000 (Seven Lacs andEighty Five Thousand) Equity Shares of Rs. 10/- each as on March 31 2017 TO Rs.58120000/- (Rupees Five Crore Eighty One Lacs and Twenty Thousand Only) divided into5812000 (Fifty Eight Lacs and Twelve Thousand) Equity Shares of Rs. 10/- each as onMarch 31 2018.

ISSUE OF BONUS SHARES

During the year under review the Company had issued 1727000 (Seventeen Lacs TwentySeven Thousand) Equity Shares as Bonus Shares to the existing Shareholders of the Companyin the ratio 22:10 [i.e. 22 (Twenty Two) fully paid equity shares of Rs. 10/- (Rupees Ten)each for each 10(Ten) fully paid equity shares held by the existing shareholder] by way ofpassing a Special Resolution at an ExtraOrdinary General Meeting of the Members of theCompany which was held on Sunday June 25 2017.All Bonus Shares issued ranked paripassuwith existing equity shares of the Company.

CONVERSION OF COMPANY INTO A PUBLIC LIMITED COMPANY

The Company pursuant to the provisions of Section 14 of the Companies Act 2013 andall other applicable provisions changed the its status from Private Limited Company toPublic Limited Company by passing a Special Resolution at an Extra-Ordinary GeneralMeeting which was held on Monday July 31 2017. Consequently the name of the Companychanged from "Tirupati Forge Private Limited" to "TIRUPATI FORGELIMITED" and a fresh certificate of incorporation consequent upon Conversion ofPrivate Company to Public Limited dated August 11 2017 was issued by Registrar ofCompanies Gujarat Dadra and Nagar Haveli. Further it had adopted new set of Memorandumof Association and Articles of Association in conformity with the provisions of theCompanies Act 2013 & Rules made there under and also with the requirements of SEBIAct/Regulations as are applicable to a Public Limited Company.

ISSUE OF EQUITY SHARES ON PREFERENTIAL BASIS

Pursuant to Sections 42 & 62 of the Companies Act 2013 and Rule 14 of Companies(Prospectus and Allotment of Securities) Rules 2014 the Company had offered issued andallotted 1500000 (Fifteen Lacs) Equity Shares of Rs.10/-( Rupees Ten Only) each at apremium of Rs. 1 /- (Rupee One Only) aggregating Rs. 16500000/- (Rupees One CroreSixty-Five Lacs Only) considering 30th June 2017 as relevant Date for Preferential Issuesto Promoters Promoters Group and Others.

The Company accorded approval from the Members of the Company by way of a SpecialResolution passed at an Extra-Ordinary General Meeting which was held on Monday July 312017.

LISTING INFORMATION

The Equity Shares of the Company got listed on Emerge Platform of National StockExchange of India Limited. (NSE EMERGE) and the Equity Shares of the Company are availablefor trading from Thursday October 12 2017 onwards.

Name and Address of Stock Exchange Script Symbol
NSE EMERGE
National Stock Exchange of India Limited (NSE)
"Exchange Plaza" Bandra - Kurla Complex
Bandra (E) Mumbai - 400 051. TIRUPATIFL*
Maharashtra India
https://www.nseindia.com/emerge/

Script Symbol of the Company at the time of listing of Equity Shares of the Company(i.e. October 12 2017) was "FORGE". Later the Company had changed its ScriptSymbol from "FORGE" to "TIRUPATIFL" w.e.f. Monday January 152018.

The Company brought an initial public offer of 1800000 equity shares of face value ofRs. 10/- each for cash at a price of Rs. 29/- per equity share including a share premiumof Rs. 19/- per equity share (the "Issue Price") aggregating Rs. 522.00 lacs("The Issue") of which 92000 equity shares of face value of rs. 10/- each forcash at a price of Rs. 29/- per equity share aggregating Rs. 26.68 lacs was reserved forsubscription by the market maker to the issue (the "market maker reservationportion"). The issue less market maker reservation portion i.e. issue of 1708000equity shares of face value of Rs. 10 each for cash at a price of Rs. 29/- per equityshare aggregating Rs. 495.32 lacs was referred as the "net issue". The issueand the net issue constituted 30.97% and 29.39% respectively of the fully diluted postissue paid up equity share capital of the Company. The proceeds from Initial Public Offer(IPO) is Rs. 46604927/- (Rupees four Crores Sixty Six Lacs Four Thousand Nine Hundredand Twenty Seven) [net of issue expenses].

Particulars Details of Equity Shares
Pre and Post Issue Equity Shares
Equity Shares outstanding prior to the Issue 4012000 Equity Shares
Equity Shares outstanding after the Issue 5812000 Equity Shares

The Company intended to utilize the net proceeds from Issue towards the followingobjects:

Working Capital Requirements

Repayment of Loan

General Corporate Purpose

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Following were the Directors and Key Managerial Personnel of the Company as on March31 2018:

Sr. No. Name of persons Designation Directors Identification Number (DIN) Date of Appointment
1. Mr. Hiteshkumar G. Thummar Chairman & Managing Director 02112952 25/03/2017
2. Mr. Ajay V. Sardhara Whole Time Director 06386557 15/09/2012
3. Mr. Bhavesh T. Barsiya Director 05332180 17/08/2012
4. Mrs. Darshna H. Thummar Non Executive and Non Independent Director 07869257 31/07/2017
5. Mr. Ramesh M. Patel Independent Director 02738359 31/07/ 2017
6. Mr. Sachin P. Ravani Independent Director 07874835 31/07/2017
7. Mr. Atul L. Natu Chief Financial Officer N.A. 10/06/2017
8. Ms. Banashri H. Joshi Company Secretary & Compliance Officer N.A. 27/07/2017

Mr. Bhavesh Barisya Director [DIN: 05332180] is liable to retire by rotation at theensuing Annual General Meeting pursuant to Section 152 of the Companies Act 2013 readwith Companies (Appointment and Qualification of Directors) Rules 2014 and the Articlesof Association (AoA) of your Company and being eligible has offered himself forre-appointment subject to approval of the Members in the ensuing AGM. The IndependentDirectors of the Company are not liable to retire by rotation.

All the Directors of the Company have confirmed that they are not disqualified frombeing appointed in terms of Section 164 of the Companies Act 2013.

COMMITTEES OF BOARDS

The Board of Directors in line with the provisions of the Act has formed followingCommittees:

a. Audit Committee

The Company has formed audit committee in line with the provisions Section 177 of theCompanies Act 2013. Audit Committee meeting is generally held for the purpose ofrecommending the half yearly and yearly financial result. Additional meeting is held forthe purpose of reviewing the specific item included in terms of reference of theCommittee. The Statutory Auditors of the Company are invited in the meeting of theCommittee wherever requires. Chief Financial Officer of the Company is a regular inviteeat the Meeting.

Recommendations of Audit Committee have been accepted by the Board wherever/whenevergiven.

b. Nomination and Remuneration Committee

The Company has formed Nomination and Remuneration committee in line with theprovisions of Section 178 of the Companies Act 2013. Nomination and RemunerationCommittee Meetings are generally held for identifying the persons who are qualified tobecome Directors and may be appointed in senior management and recommending theirappointments and removal.

c. Stakeholders' Relationship Committee

The Company has constituted Stakeholder's Relationship Committee mainly to focus on theredressal of Shareholders' / Investors' Grievances if any like Transfer / Transmission /Demat of Shares;Loss of Share Certificates; Non-receipt of Annual Report; DividendWarrants; etc.

The Company had received one complaint from a shareholder during the quarter startingfrom October 1 2017 to December 31 2017 which was resolved by the end of the saidquarter. There are no complaints pending as on March 31 2018.

d. Complaints Committee for Sexual Harassment Complaints Redressal

To foster a positive workplace environment free from harassment of any nature we haveconstituted a Complaints Committee for Sexual Harassment Complaints Redressal throughwhich we address complaints of sexual harassment at the all workplaces of the Company. TheComplaints Committee is responsible for investigating every formal written complaint ofsexual harassment taking appropriate remedial measures to respond to any substantiatedallegations of sexual harassment and Discouraging & preventing employment - relatedsexual harassment. In conclusion the Company reiterates its commitment of providing itsemployees a workplace free from harassment / discrimination and where every employee istreated with dignity and respect.

During the year under review there were no incidences of sexual harassment reported.

NUMBER OF MEETINGS OF BOARD OF DIRECTORS

The Board of Directors of the Company met for 17 (Seventeen) times during the fiscal2017-18 and requisite quorum was present in all the meetings; the details of which are asunder:

Sr. No. Date of Meeting Total No. of Directors as on the date of the Meeting No. of Directors who attended Meeting
1. 14/04/2017 3 3
2. 08/05/2017 3 3
3. 10/05/2017 3 3
4. 28/05/2017 3 3
5. 10/06/2017 3 3
6. 20/06/2017 3 3
7. 25/06/2017 3 3
8. 30/06/2017 3 3
9. 27/07/2017 3 3
10. 01/08/2017 6 5
11. 03/08/2017 6 6
12. 17/08/2017 6 6
13. 18/09/2017 6 6
14. 20/09/2017 6 5
15. 10/10/2017 6 5
16. 26/12/2017 6 6
17. 15/03/2018 6 5

NUMBER OF MEETINGS OF BOARD COMMITTEES

Meetings and Attendance Records of Audit Committee

Sr. No. Date of Meeting Total No. of Directors of the Committee No. of Directors who attended the Meeting
1. 18/09/2017 3 3
2. 15/12/2017 3 3
3. 06/03/2018 3 3

Meetings and Attendance Records of Nomination & Remuneration Committee:

Sr. No. Date of Meeting Total No. of Directors of the Committee No. of Directors who attended the Meeting
1. 25/08/2017 3 3
2. 06/11/2017 3 2
3. 08/01/2018 3 2

Meetings and Attendance Records of Complaints Committee for Sexual HarassmentComplaints Redressal:

Sr. No. Date of Meeting Total No. of Directors of the Committee No. of Directors who attended the Meeting
1. 21/08/2017 3 2
2. 20/10/2017 3 2
3. 12/01/2018 3 3

Meetings and Attendance Records of Independent Directors' Meeting

Sr. No. Date of Meeting Total No. of Directors of the Committee No. of Directors who attended the Meeting
1. 30/12/2017 3 3
2. 30/03/2018 3 3

Meetings and Attendance Records of Independent Directors' Meeting:

Sr. No. Date of Meeting Total No. of Directors of the Committee No. of Directors who attended the Meeting
1. 05/12/2017 2 2

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(5) of the Companies Act 2013 your Directorsconfirm that:

a. in the preparation of the annual accounts for the financial year ended March 312018 the applicable accounting standards had been followed and there were no materialdepartures;

b. the Directors had 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 31st March 2018 and of the profitof the Company for that period;

c. the Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;

d. the Directors had prepared the annual accounts on a going concern basis;

e. the Directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.

f. The Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

DECLARATION BY INDEPENDENT DIRECTORS

Your Company has received Declarations from all the Independent Directors confirmingthat they meet the criteria of independence as prescribed under 149(6) of the CompaniesAct 2013 read with Rules issued there under as well as Regulation 16(1)(b) of the ListingRegulations (including any statutory modi_cation (s) or re-enactment(s) for the time beingin force).

ANNUAL RETURN

The Annual Return as on March 31 2018 in the prescribed Form No. MGT-7 pursuant toSection 92 of the Companies Act 2013 and Rule 11 of the Companies (Management andAdministration) Rules 2014 will be available on Company's website athttp://www.tirupatiforge.com/file/tirupati-forge-ltd .

PUBLIC DEPOSITS

During the year under review the Company has not accepted deposits within the meaningof Section 73 to 76 of the Companies Act 2013 read with Companies (Acceptance ofDeposits) Rules 2014.

CORPORATE GOVERNANCE

Your Company strives to incorporate the appropriate standards for corporate governance.However the Equity Shares of the Company are listed on SME Platform of National StockExchange of India Limited (NSE EMERGE) and therefore pursuant to Regulation 15(2)(b) ofSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 Regulation 27 ofSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and Part C ofSchedule V relating to compliance of Corporate Governance shall not apply to the Company.

Therefore the Company need not to give report on compliance of Corporate Governance asspecified in Part E of Schedule II pursuant to Regulation 27(1) SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 and submitting Compliance Report onCorporate Governance on quarterly basis pursuant to Regulation 27(2) SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.

MATERIAL CHANGES AFFECTING THE COMPANY

There are no material changes and commitments affecting the financial position of theCompany have occurred between the ends of financial year of the Company i.e. March 312018 to the date of this Report.

VIGIL MECHANISM

The Company has established a vigil mechanism and accordingly framed a Whistle BlowerPolicy. The policy enables the employees to report to the management instances ofunethical behavior actual or suspected fraud or violation of Company's Code of Conduct.Further the mechanism adopted by the Company encourages the Whistle Blower to reportgenuine concerns or grievances and provide for adequate safeguards against victimizationof the Whistle Blower who avails of such mechanism and also provides for direct access tothe Chairman of the Audit Committee in exceptional cases. The functioning of vigilmechanism is reviewed by the Audit Committee from time to time. None of the Whistleblowers has been denied access to the Audit Committee of the Board. The Whistle BlowerPolicy of the Company is available on the website of the Company athttp://www.tirupatiforge.com/file/whistle-blower-policy.pdf .

PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIES PROVIDED

The Company during the year under review have not given loans or made investments orgiven guarantees or provided securities directly or indirectly to any person or bodycorporate pursuant to the provisions of Section 186 of Companies Act 2013. Further ithas not acquired by way of subscription purchase or otherwise the securities of anyother body corporate and thus disclosures under Section 186 are not required to be made.

The Company has not advanced any loan to any of its Directors or any other person inwhom the Director is interested or given any guarantee or provided any security inconnection with any loan taken by him/her in terms of Section 185 of the Companies Act2013.

PARTICULARS OF TRANSACTIONS WITH RELATED PARTIES

The Company has entered into related party transaction with Mr. Chunilal M. Sardhararelative of Director for leasing of property. Further it has also purchased fixed assetsfrom A-1 Furniture an entity in which Director has significant influence. Detailedinformation of mentioned related party transactions are disclosed in Form AOC-2 asrequired under Section 134(3)(h) of the Companies Act 2013 read with Rule 8 of Companies(Accounts) Rules 2014. Form AOC-2 is enclosed herewith as "Annexure I" whichforms part of Directors' Report.

All related party transactions are placed before the Audit Committee and Board fortheir approval. Omnibus approval of the Audit Committee was obtained for transactionswhich are of repetitive nature. Transactions entered into pursuant to omnibus approval areaudited by the Audit Committee and a statement giving details of all Related PartyTransactions are placed before the Audit Committee and the Board for review and approvalon a quarterly basis.

The Related Party Transactions Policy as approved by the Board of Directors has beenuploaded on the website of the Company athttp://www.tirupatiforge.com/file/related-party-policy.pdf . Members are requested torefer to Note no. 33 & 34 to the financial statement which sets out related partydisclosures for the year under review.

AUDIT AND AUDITORS' REPORT

STATUTORY AUDITORS

Maharishi & Co. Chartered Accountants [ICAI Firm Registration No. 124872W] wereappointed as Statutory Auditors of the Company for the F.Y. 2017-18 to fill casualvacancy caused due to the Resignation of M. B. Sardhara & Associates CharteredAccountants at the Extra-Ordinary General Meeting (EGM) of the Members of the Companywhich was held on Friday February 23 2018 at the Registered Office of the Company tohold office from the conclusion of the EGM till the conclusion of Annual General Meeting(AGM) to be held in the year 2018 at a remuneration recommended by the Audit Committee anddecided by Board of Directors of the Company.

Further Board of Directors at the Meeting based on recommendation of Audit Committeehas recommended the appointment of Maharishi & Co. Chartered Accountants [ICAIFirm Registration No. 124872W] as Statutory Auditors of the Company from theconclusion of this Annual General Meeting until the conclusion of the next Annual GeneralMeeting of the Company to be held in the year 2019 at such remuneration as may berecommended by the Audit Committee and decided by the Board of Directors of the Company.

Maharishi & Co. Chartered Accountants [ICAI Firm Registration No. 124872W] haveconsented to the said appointment and confirmed that their appointment if made would bewithin the limits specified under section 141(3)(g) of the Act and that they are notdisqualified to be appointed as Statutory Auditors in terms of section 143 of the Act.Members are requested to approve appointment of the proposed Statutory Auditors from theconclusion of ensuing AGM until the AGM to be held in the year 2019 at such remunerationas may be recommended by the Audit Committee and decided by the Board of Directors of theCompany.

No adverse remarks qualifications reservation or disclaimer is given by the StatutoryAuditors of the Company during the year under review that the Board need to reply.

SECRETARIAL AUDIT

In terms of provisions of Section 204 of the Companies Act 2013 read with Rules madethereunder the Company has appointed CS Piyush Jethva to undertake the Secretarial Auditof the Company for the financial year 2017-18. The Secretarial Audit Report is attached tothis Report as "Annexure II".

Secretarial Auditors have observed that the Company had filed some Form with Registrarwith payment of additional fees. Further they have observed that the Company had notfiled Form for creation of charge in favour of ICICI Bank for loan taken against car. TheBoard would like to clarify that the Company was not having wholetime Company Secretaryearlier and now for the purpose of timely compliance of all laws the Company hadappointed Company Secretary who is also Company's Compliance Officer. Hence the Companywill file all Forms/ Returns in time in future. Further as regard to filing of Form forcreation of charge the Company will apply to the Regional Director for condonation ofdelay in filing of Form and will register the Charge. As regards the payment of stampduty the Company had made payment of all duties as on date of this Report. Moreover asregards comment of Secretarial Auditors about the compliance of Regulation 29 of SEBI(SAST) Regulations 2011 management would like to clarify that the Company had notreceived any intimation from any shareholders regarding his/her shareholding exceeding 5%. In terms of Regulation 29 it is duty of a person who acquires more than 5 % shares inCompany to intimate to the Company & Exchange about his such holding. Thereforethere is no non-compliance on part of the Company.

COST AUDIT

Provisions given under Section 148 of Companies Act 2013 and Rule 14 of Companies(Audit and Auditors) Rules 2014 are not applicable for your Company.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Pursuant to Section 135 of the Companies (Amendment) Act 2017 every Company havingNet worth of Rs. 500 Crore or more OR Turnover of Rs. 1000 Crore or more OR Net Profit ofRs. 5 Crore or more during the immediately preceding financial year (F.Y. 2016-17) shallconstitute of Corporate Social Responsibility (CSR). Tirupati Forge Limited does not fallunder any criteria as mentioned above and hence provisions of Section 135 of the CompaniesAct 2013 are not applicable to the Company.

POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION

Nomination and Remuneration Policy in the Company is designed to create a highperformance culture. It enables the Company to attract motivated and retained manpower incompetitive market and to harmonize the aspirations of human resources consistent with thegoals of the Company. The Company pays remuneration by way of salary benefitsperquisites and allowances to its Managing Director and the Executive Directors.

a) Policy on Appointment of Directors Key Managerial Personnel and Senior ManagementPersonnel:

• The policy is formulated to identify and ascertain the integrity qualificationexpertise and experience of the person for appointment as Director Key ManagerialPersonnel and Senior Management personnel and recommend to the Board for his / herappointment.

• A person should possess adequate qualification expertise and experience for theposition he/ she is considered for appointment.

• In case of appointment of Independent Director the Committee shall satisfyitself with regard to the independent nature of the Director vis--vis the Company so asto enable the Board to discharge its function and duties effectively.

b) Policy on remuneration of Directors KMP and Senior Management Personnel:

The Company's remuneration policy is driven by the success and performance ofDirectors KMP and Senior Management Personnel vis--vis the Company. The Company'sphilosophy is to align them with adequate compensation so that the compensation is used asa strategic tool that helps us to attract retain and motivate highly talented individualswho are committed to the core value of the Company. The Company follows mixed pay offixed benefits and performance based variable pay. The Company pays remuneration by wayof salary benefits perquisites and allowance. The remuneration and sitting fees paid bythe Company are within the salary scale approved by the Board and Shareholders.

The details of remuneration paid during the financial year 2017-18 to the Directors ofthe Company is provided in notes forming part of Financial Statements which is the part ofthis Directors' Report.

RISK MANAGEMENT POLICY

A well-defined risk management mechanism covering the risk mapping and trend analysisrisk exposure potential impact and risk mitigation process is in place. The objective ofthe mechanism is to minimize the impact of risks identified and taking advance actions tomitigate it. The mechanism works on the principles of probability of occurrence andimpact if triggered. A detailed exercise is being carried out to identify evaluatemonitor and manage both business and non-business risks.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO

The information pertaining to Conservation of Energy Technology Absorption ForeignExchange Earnings and outgo as required under Section 134(3)(m) of the Companies Act 2013read with Rule 8(3) of Companies (Accounts) Rules 2014 are as stated below:

A. Conservation of Energy-

1. The steps taken or impact on conservation of energy:

The Company applies strict control system to monitor day to day power consumption in aneffort to save energy. The Company ensures optimal use of energy with minimum extent ofwastage as far as possible.

2. The steps taken by the Company for utilizing alternate source of energy:

The Company has not taken any step for utilizing alternate source of energy. Howeverthe Company is thinking of installing wind mills near the factory land which shall help toutilize natural resource i.e. wind into energy. The Management shall discuss the pros andcons of establishing the wind mills and soon decide whether the said idea will be fruitfulto the Company looking into the size of the business.

3. Capital Investment on energy conservation equipment:

The Company has not made any capital investment on energy conservation equipment.

B. Technology Absorption-

During the year under report there has been no transaction of technology absorptionand hence no reporting is required.

C. Foreign Exchange Earnings and Outgo-

Particulars F.Y. 2017-18 F.Y. 2016-17
Foreign Exchange Earnings (in Rs.) 71003807 44939529
Foreign Exchange Outgo (in Rs.) 413801 275618

SUBSIDIARY ASSOCIATE AND JOINT VENTURES OF THE COMPANY

During the year under review no Company became or ceased to become a SubsidiaryAssociate or Joint Venture Company.

DISCLOSURE OF REMUNERATION

Information pursuant to Section 134(3)(q) and Section 197 (12) of the Act read withRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 for the year ended December 31 2017 and forming part of the Directors' Report forthe said financial year is provided in "Annexure –III"

ANNUAL EVALUATION OF DIRECTORS BOARD AND COMMITTEE PERFORMANCE

The Board of Directors has carried out an annual evaluation of its own performanceboard committees and individual Directors pursuant to the provisions of the Act.

• The performance of the Board was evaluated by the Board after seeking inputsfrom all the Directors on the basis of the criteria such as the board composition andstructure effectiveness of board processes information and functioning etc.

• The performance of the Committees was evaluated by the Board after seekinginputs from the Committee Members on the basis of the criteria such as the composition ofCommittees effectiveness of Committee Meetings etc.

• The Board and the Nomination and Remuneration Committee reviewed the performanceof the individual Directors on the basis of the criteria such as the contribution of theindividual Director to the Board and Committee Meetings like preparedness on the issues tobe discussed meaningful and constructive contribution and inputs in meetings etc. Inaddition the chairman was also evaluated on the key aspects of his role.

Separate meeting of Independent Directors was held to evaluate the performance ofnon-independent Directors performance of the board as a whole and performance of theChairman taking into account the views of Executive Directors and Non-Executive Director.The same was discussed in the Board Meeting that followed the meeting of the independentdirectors at which the performance of the Board its Committees and Individual Directorswas also discussed. Performance evaluation of Independent Directors was done by the entireboard excluding the independent director being evaluated.

REPORT OF FRAUD

The Auditors of the Company have not reported any fraud as specified under Section143(12) of the Companies Act 2013.

PARTICULARS OF EMPLOYEES

The Company has no employee who is in receipt of remuneration of Rs. 850000/- permonth or Rs. 10200000/- per annum and hence the Company is not required to giveinformation under sub Rule 2 and 3 of Rule 5 of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014.

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 were no significant and material Orders passed by the Regulators or Courts orTribunals impacting the going concern status and Company's operations in future.

GENERAL DISCLOSURES

1. The Company has not made any provision of money for purchase of its own shares byemployees or by trustees for the benefit of employees as per Rule 16(4) of Companies(Share Capital and Debentures) Rules 2014.

2. The Company has not issued any sweat equity share during the financial year inaccordance with the provisions of Section 54 of the Companies Act 2013 read with Rule8(13) of the Companies (Share Capital and Debentures) Rules 2014.

3. The Company has not issued any equity shares with differential voting rights duringthe financial year as per Rule 4(4) of the Companies (Share Capital and Debentures) Rules2014.

4. The Company has not issued any employee stock option during the financial year asper Rule 12(9) of the Companies (Share Capital and Debentures) Rules 2014.

5. There is no revision in the Board Report or Financial Statement.

APPRECIATION AND ACKNOWLEDGEMENTS

Your Directors wish to place on record their sincere appreciation for significantcontributions made by the employees at all levels through their dedication hard work andcommitment enabling the Company to achieve good performance during the year under review.

Your Directors also take this opportunity to place on record the valuable co-operationand support extended by the banks government business associates and the shareholdersfor their continued confidence reposed in the Company and look forward to having the samesupport in all future endeavors.

By and on behalf

TIRUPATI FORGE LIMITED

Hiteshkumar G. Thummar

Chairman & Managing Director

[DIN: 02112952]

Hadamtala (Rajkot)

August 3 2018