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Veto Switchgears & Cables Ltd.

BSE: 539331 Sector: Engineering
NSE: VETO ISIN Code: INE918N01018
BSE 00:00 | 24 Feb 52.75 -0.40
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NSE 00:00 | 24 Feb 52.90 0.40
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OPEN 51.10
PREVIOUS CLOSE 53.15
VOLUME 4268
52-Week high 82.55
52-Week low 33.20
P/E 9.84
Mkt Cap.(Rs cr) 101
Buy Price 48.10
Buy Qty 100.00
Sell Price 53.50
Sell Qty 240.00
OPEN 51.10
CLOSE 53.15
VOLUME 4268
52-Week high 82.55
52-Week low 33.20
P/E 9.84
Mkt Cap.(Rs cr) 101
Buy Price 48.10
Buy Qty 100.00
Sell Price 53.50
Sell Qty 240.00

Veto Switchgears & Cables Ltd. (VETO) - Director Report

Company director report

Dear Members

Your Directors are pleased to present the 11th Annual Report on the business andoperations of the Company together with the Audited financial Statements for thefinancial year ended 31st March 2018 and other accompanying reports notes andcertificates.

1. Company Performance

Your Company has grown exponentially during the current financial year. The Standaloneand Consolidated

Audited financial Results of the Company for year ended 31st March 2018 are as follows.

financial Results:

Consolidated

Standalone

Particulars 2017-18 2016-17 2017-18 2016-17
Revenue from Operations
(including other Income) Less Expenses : 25562.77 24072.16 12963.76 12570.09
(a) Cost of materials consumed 5125.90 4444.44 4728.51 4444.44
(b) Purchases of stock-in-trade 14571.56 14790.96 4201.08 3691.31
(c) Changes in inventories of finished goods and stock- in-trade (705.90) (273.28) (1243.68) 119.17
(d) Employee benefits expense 901.08 1222.53 755.32 1100.57
(e) Finance costs 275.64 412.38 273.98 410.31
(f) Depreciation and amortisation expense 158.17 166.44 148.05 166.44
(g) Other expenses 1344.10 1177.38 1124.35 1110.89
Total expenses 21670.55 21940.85 9987.61 11043.12
Pro t before tax and exceptional items 3892.22 2131.31 2976.15 1526.97
Less: Exceptional items - - - -
Pro t before tax 3892.22 2131.31 2976.15 1526.97
Less: Tax Expense 995.15 298.84 983.07 298.8
Less: Minority interest - - - -
Pro t after tax 2897.07 1832.47 1993.08 1228.17

Indian Accounting Standards

The Ministry of Corporate Affairs (MCA) vide its noti cation in the official Gazettedated 16th February 2015 noti ed the Indian Accounting Standards (IND AS) which hasreplaced the existing Indian GAAP prescribed under Section 133 of the Companies Act 2013read with rule 7 of the Companies (Accounts) Rules 2014. Pursuant to the above said notication the Indian Accounting Standards (IND AS) is applicable on the Company for theaccounting periods beginning on or after 1st April 2017.

Consolidated financial Results:-

During the year under review on consolidated basis our Company earned profit before taxand exceptional items of Rs. 3892.22 Lacs against Rs. 2131.31 Lacs in the previous year.The Company earned profit after tax of Rs. 2897.07 Lacs as compare to Rs. 1832.47 Lacsin the previous year. The Company had Income from operation of Rs. 25562.77 Lacs ascompared to Rs. 24072.16 Lacs in previous year. The Pro t beforeInterest/Depreciation/Tax (PBDIT) was Rs. 4147.88 Lacs as compared to Rs. 2699.09 Lacs inprevious year.

Standalone financial Results:-

During the year under review on standalone basis our Company earned a profit before taxand exceptional items of Rs. 2976.15 Lacs against Rs. 1526.98 Lacs in the previous year.The Company earned profit after tax of Rs. 1993.08 Lacs as compare to Rs. 1228.19 Lacs inthe previous year. The Company had Income from operation of Rs. 12380.07 Lacs as comparedto Rs. 12033.93 Lacs in previous year. The Pro t before Interest/Depreciation/Tax (PBDIT)was Rs. 3349.13 Lacs as compared to Rs. 2094.11 Lacs in previous year.

Keeping pace with growth trajectory and its efforts to improve ef ciency productivityand pro tability the management seeks the trust of shareholders in future growth of theCompany and enhancement of shareholders wealth.

Dividend

We are pleased to recommend a nal dividend of Rs. 2/- per share having face value ofRs. 10/- each aggregating to 20% of F.V. for the financial year ended on 31st March 2018.The nal dividend if approved by the members will be paid to members within the periodstipulated by the applicable Companies Act. The aggregate dividend for the year willamount to 20% being Rs. 2 per share of 10/- each.

Reserves

Rs. 1993.08 lakhs has been transfer to reserves and surplus account during the currentyear.

Share Capital

The paid up Equity Share Capital as at 31st March 2018 stood at Rs.183271000.

However the company subsequently has allotted 787855 Equity Shares of Rs. 10 each on23rd May 2018 to employees/directors of the company pursuant to exercise of Stock Optionsunder Employee Stock Option Scheme 2015 (“ESOP SCHEME 2015”). Consequent to thesaid allotment the paid up Equity Share Capital has been increased to Rs. 19114955Equity Shares of Rs. 10 each. Also through the Extra-ordinary General Meeting(“EGM”) of the Members of the Company held on May 31st 2017 the company hasbeen authorised to create offer issue and allot by way of a preferential issue fromtime to time and in one or more tranches an aggregate of 4500000 (Forty Five Lacs)warrants convertible into equivalent number of equity shares of a face value of Rs. 10/-each of the Company (“Warrants”) at any time within a period of 18 months fromthe date of allotment of Warrants at an exercise price of Rs. 170 (including a premium ofRs. 160) per equity share (“Exercise Price”) to the Promoter Group entities ofthe Company.

financial Statements

In accordance with SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 (hereinafter referred to as `Listing Regulations`) and Section 136 of the CompaniesAct 2013 read with Rule 10 of the Companies (Accounts) Rules 2014 the Annual Reportcontaining salient features of the financial statements including consolidated financialstatements for the financial year 2017-18 along with statement containing salientfeatures of the Directors' Report (including Integrated Reporting and ManagementDiscussion & Analysis and Corporate Governance Report) is being sent to allshareholders who have not registered their email address(es) for the purpose of receivingdocuments/ communication from the Company in electronic mode. Please note that you will beentitled to be furnished free of cost the full Annual Report 2017-18 upon receipt ofwritten request from you as a member of the Company.

Full version of the Annual Report 2017-18 containing complete Balance Sheet Statementof Pro t & Loss other statements and notes thereto including consolidated financialstatements prepared as per the requirements of Schedule III to the Companies Act 2013Directors' Report (including Integrated Reporting and Management Discussion & Analysisand Corporate Governance Report) is being sent via email to all shareholders who haveprovided their email address(es).

Full version of Annual Report 2017-18 is also available for inspection at theregistered office of the Company during working hours up to the date of ensuing Annualgeneral meeting (AGM). It is also available at the Company`s website atwww.vetoswitchgears.com.

Change in the nature of business if any

There is no change in the nature of business during current financial year.

Material changes if any affecting the financial position of the Company which haveoccurred between the ends of the financial year of the company to which the financial yearrelates and the date of the report.

The company has launched its new Product range 'VYOMA' for Modular Switches on Sunday6th May 2018 at Jaipur Rajasthan.

The company has shut - down the additional factory unit (depot) at Delhi and Ghaziabadand inaugurated new plants at Indore Allahabad and Bhatinda.

Management Discussion and Analysis

The Management Discussion and Analysis Report of the financial condition and results ofoperations of the Company for the year under review as required under regulation 34(2) (e)of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 is being givenseparately and forms part of this Board Report .

Particulars of Loan Guarantee and Investments

The details of loans guarantees and investments covered under the provisions ofSection 186 of the Companies Act 2013 are given in the respective notes to the Standalonefinancial Statements of the Company.

Deposits

During the year under review the Company has neither accepted nor renewed any depositsin

terms of Chapter V of the Companies Act 2013 and Rules framed thereunder.

2. Business Operations/ State of Company's Affairs

At Veto we work with the single minded objective of not only improving but empoweringpeople's lives with our unique repertoire of products and services backed by time testedtechnology and path-breaking R & D methods. With persistent focus on innovationprompt capitalization of opportunities building up credibility through strategicthinking operational expertise well planned investments and business integrity we aimto continue our journey unabated. Reaching out with world-wide tie-ups collaborations andimport-export relations we envision an organization that is truly global in every waytechnology policies and possibilities. Your company has been developing as a distinctivebrand of leadership well equipped to address critical challenges faced by industry andsociety. We look forward to being recognized as one of the major competitors in the globalelectrical accessory industry. Veto switchgears and Cables Limited is one of the mostrespected cable manufacturers in India. Brand Veto is committed to quality safety andservice with no compromise. The Company is an ISO

9001:2008 certi ed company engaged in the manufacture and sale of wires & cablesand electrical accessories in India. The brand name VETO is since 1967. VETO holds a majorpart of electrical accessories in India. The company also has a strong and hardworkingteam of marketing professionals and dealers and distributors sales of the unit increasingday by day and its production is manifold many times since its inception. We are lookingforward to grow further by way of providing “Best Quality at CompetitivePrices.” The product portfolio ranges from industrial cables stand cables totelephone & co-axial wires from general switches to modular switches from ceilingfans to rechargeable fans compact uorescent lamps LED bulbs and other electricalaccessories. We are dealing in electrical accessories like switch socket MCB bell andall electrical accessories which are used for household purposes and manufacturing wiresand cables. Cable starts from 0.75 mm to 10 mm. Our Company supplies these products underthe brands “VETO” and “VIMAL POWER” through large network of dealersto the customers in India as well as selected customers abroad. VIMAL POWER is a part ofthe Veto group and continues to reinforce a successful international presence and enhanceits enviable reputation for innovation. A continuous programme of research and developmentensures a world beating range of cables to satisfy or surpass requirements of IndianStandards. Recently the company has launched its new range of Modular Switches by theBrand Name “VYOMA”. In the year the company has largely bene tted from the saleof LED panel Lights LED Flood Light Slim Panel Light LED strip Light. Its majordistribution in India covers more than 10 states including major sale in Rajasthan andGujarat. The Group is strongly positioned in high-tech markets and offers the widest rangeof products services technologies and know-how. In the Energy sector the Group operatesin the business of underground and submarine power transmission cables and systemsspecial cables for applications in a range of industries and building services and alsomedium and low voltage cables for the construction and infrastructure. In the Telecomsector the Group manufactures cables and accessories for the voice video and datatransmission and offers a complete range of optical bres optical and copper cables andconnectivity systems.

Raw Material

Our Company's present and proposed consumption of Raw material is as under:

(Qty. in kg)
Product category Existing (2017-18) Proposed (2018-19)
Copper 289008840 317909724
PVC Resin 31910295 35101325
Aluminium 11752879 12928167

Infrastructure facilities

Power : Presently we have 400 KVA of power supply sanctioned by Uttarakhand PowerCorporation Limited of which we utilize approximately 325 KVA of power for our presentbusiness operations. In addition to avoid any disruption in the power supply our Companyhas already installed a DG set of 250 KVA capacity. Therefore we envisage that ourfurther requirement of power for our proposed modernization at our Haridwar facility canbe easily met from the present supplies.

Fuel : Our Company mainly requires HSD for operating the DG sets. The present monthlyconsumption of HSD is about 1000 litres. The HSD is being supplied by retail outlets ofIOC HPCL and BPCL.

Water : Water is basically required for drinking and other domestic purpose. Ourpresent requirement at our Haridwar unit is about 5000 litres per day. Our entire waterrequirement is met fromour own borewell. The water supply is regular and sufficient tomeet entire requirements. The proposed modernization at our Haridwar facility will requireadditional 2000 litres of water per day. There is no dif culty in obtaining this becauseof the presence of a number of borewell and the water level in the area being high due toproximity to nearby canal and a river Ganga.

Manpower : Our Company has adequate manpower at all levels at present and does notenvisage any dif culty in getting the requisite personnel for our business operations atexisting locations. Following are the details of our manpower:

Category Nos.
Top management 3
Managerial & Supervisory staff 6
Of ce staff 68
Skilled workers 55
Unskilled workers 370
Total 502

Ef uent Treatment and Disposal : Our Company does not generate any industrial ef uentswhich is hazardous to the environment. The waste produced during the manufacturingoperations is re-used and/ or recycled.

Environmental Clearance : We have got all the necessary approvals from the localauthorities to operate our business.

Safety standards : Quality and safety are the hallmarks of our diverse range ofproducts which are designed and manufactured to the very highest standards such as ISO9001 and approved by the leading approvals organisations nationally and internationally.

Our Strategy : Further research in process and product engineering to ensure the bestmanufacturing process for our products in order to enhance competitiveness in the marketsis one of our goals. Research and development in electrical accessories and other alliedproducts will better enable a competitive position in the market. Further enhancement ofoperations by improving the existing assets to yield better output and installation of newassets to enhance and attract new markets are also in the horizon.

Capacity and capacity utilization

Particulars Projected Actual
FY 2017-18 FY 2018-19 FY 2017-18
Wires & Cables
Installed Capacity 20 Lacs Bundles 20.00 Lacs Bundles 20.00 Lacs Bundles
Capacity Utilization 40% 40% 31.45%
(in %)
Production 8.00 Lac Bundles 8.00 Lac Bundles 6.29 Lac Bundles
Electrical Accessories
Installed Capacity 600 Lac pieces 600 Lacpieces 600 Lac pieces
Capacity Utilization 30% 30% 15.57%
(in %)
Production 180 Lac pieces 200 Lac pieces 126 Lac pieces

Insurance

Our Company has taken up a range of insurance policies including:

1. Fire policies for our units buildings and of ces raw materials work-in-progressand finished goods;

2. Marine policy for transit of raw materials and finished products in India and MarineExport policy;

3. Accidental & Health insurance facility for eld staff;

4. Gratuity policy;

These insurance policies are reviewed annually to ensure that the coverage is adequate.All the

policies are in existence and the premiums have been paid thereon.

Risks and Concerns:

1. Common Risks: Accidents in the work place res earthquake tornadoes and any othernatural disasters

2. Legal Risks fraud Theft etc

3. Uncertainties in financial markets

4. Failure in Projects

5. Credit Risks

6. Outstanding Debtors

7. Security and Storage of Data and Records

8. Competitors have market standing out of Rajasthan.

Internal Control System

The Company has put in place an adequate system of internal control commensurate withits size and nature of business. These systems provide a reasonable assurance in respectof providing financial and operational information complying with applicable statutessafeguarding of assets of the Company and ensuring compliance with corporate policies. TheAudit Committee reviews adherence to internal control systems and internal audit reports.

Company has formed the Risk Management Committee for the assessment and monitoring ofthe risks involved in the Company.

Preparation and issue of financial reports to shareholders and the markets includingthe Annual Report and consolidated financial statements is overseen by the AuditCommittee. The Company's financial reporting process is controlled using documentedaccounting policies and reporting formats supplemented by detailed instructions andguidance on reporting requirements. The Company's processes support the integrity andquality of data including appropriate segregation of duties. The financial information ofthe parent entity and all subsidiary entities which form the basis for the preparation ofthe consolidated financial statements are subject to scrutiny by Group level seniormanagement. The Company's financial reports financial guidance and Annual Report andconsolidated financial statements are also reviewed by the Audit Committee of the Board inadvance of being presented to the full Board for their review and approval;

Detailed budgetary process which includes identifying risks and opportunities and whichis ultimately approved at Board level;

Board approved capital expenditure and Audit Committee approved treasury policies whichclearly de ne authorization limits and procedures;

An internal audit function which reviews key financial/business processes and controlsand which has full and unrestricted access to the Audit Committee;

Established systems and procedures to identify control and report on key risks.Exposure to these risks is monitored by the Risk Management Committee; and

A risk management programme in place throughout the Company whereby Risk Managementexecutive reviews and monitors the controls in place both financial and non financial tomanage the risks facing the business.

Details of Subsidiaries

The Company has two subsidiary Companies. One in Jaipur and the other in Duabi UAE. OnMay 29th 2017 Veto Electricals Private Limited has inaugurated its manufacturing plant(100% Export Unit) at Mahindra SEZ Jaipur and has started commercial Production on July1st 2017.

Pursuant to provisions of Section 129(3) of the Companies Act 2013 a statementcontaining salient features

of the Company's subsidiaries are provided in the Annexure-I to the Board of theCompany.

In terms of provisions of Section 136 of the Companies Act 2013 the financialstatements of the Company consolidated financial statements along with relevant documentsand separate audited accounts in respect of subsidiaries and are also available on thewebsite of the Company. These documents shall also be available for inspection at theregistered office of the Company during business hours up to the date of ensuing AGM. On22nd November 2014 Veto Electricals Private Limited became the Wholly Owned SubsidiaryCompany of the Company. Same has been disclosed in Annexure-I

On 11th October 2015 Veto registered a wholly owned subsidiary in Dubai by the name of“Veto Overseas Private F.Z.E. It has earned total revenue of 70735181 AED for theyear ended 31st March 2018. The Company has declared profit of 6523040 AED. It is headedby Mr. Ashish Goklani as its Manager. The copy of the Consolidated audited accountstogether with the independent auditor's report is provided in a separate section of thisAnnual Report.

Performance and financial position of Subsidiary Company

The details with respect to subsidiary Companies in Form AOC-1 as on March 31 2018have been discussed

in Annexure II.

3. Human Resource Management

Employee Relations

VETO encourages a culture of trust and mutual respect. Employees are aligned on commonobjectives and take pride in the quality of the products that leave the factory for salein the markets. We have over the years realized the importance of human capital and dulyacknowledge it in its business operations. Your Company has managed to create“Lifers” at VETO- people who have been associated with your Company many havingstarted their earning life at VETO. It gives the much needed stability and satisfactionwhen we realize

that our partners in success trust us to such an extent that they stand by us at alltimes.

Their experience skills knowledge ideas and enthusiasm are an invaluable asset. Wehumbly acknowledge their contributions with competitive compensation and benefits thatappropriately reward performance. Pay revisions and other benefits are designed in such away to compensate good performance of the employees of the Company.

The talent pool of your Company has steadily evolved with changing times with freshtalent being infused to meet demanding situations. The Company has a scalable recruitmentand human resource management process which enables us to attract and retain high caliberminds.

Inspired by its commitment to quality and core values of honesty and transparency yourDirectors and employees look forward to the future with con dence and stand committed tocreating an even brighter future for all stakeholders.

Managerial Remuneration

A) Information as per Rule 5(1) of Chapter XIII Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014

The Nomination and Remuneration Committee continuously reviews the performance of theManaging Director Whole Time Director and Other Directors.

1. Remuneration paid to Directors

(in Lacs.)
Name of Director Title Remuneration in Year 2017-18 Remuneration in Year 2016-17 % increase in Remuneration in comparison to last year Ratio of Remuneration to MRE
Mr. Akshay Kumar Gurnani Managing Director 1500000 1500000 0.00 5.64
Mr. Narain Das Gurnani Whole- time Director 1200000 1200000 0.00 4.51
CFO
Ms. Jyoti Gurnani Director 600000 600000 0.00 2.25

1. The remuneration disclosed here is upto 31st March 2018 as per the audited financialStatements.

2. The Median Remuneration of Employees is Rs. 266136 approx.

3. Median Remuneration is calculated on the basis on annualized salary MRE MedianRemuneration of employees.

4. No employee received remuneration in excess of the highest paid Director.

5. The median remuneration of employees was Rs. 266131 as on 31st March 2018 and Rs.212000 as on 31st March 2017. There was an increase in MRE during the financial year2017-18 of 24.18%.

6. On 31st March 2018 the total number of permanent employees on the rolls of Companyis 502 employees.

7. Average Salary increase of non-managerial employees was 12.78 % and that ofmanagerial employees 22.64 % in financial year 2017-18. There are no exceptionalcircumstances in increase in managerial remuneration.

8. There has been no change in the remuneration of any other director.

9. Remuneration paid during the year ended 31st March 2018 is as per the RemunerationPolicy of the Company.

Particulars of Employees

Your Directors con rmed that no employee fall under the particulars of Section 197 ofthe Companies Act 2013 read with Rule 5 (2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014.

4. Corporate Governance

Corporate Governance Report

Corporate Governance refers to laws regulations and acceptable business practicesthat determine relationships between corporation owners and its managers on one hand andits investors on the other hand. It was born and evolved in response to corporatefailures crises and misdeeds. In many types of economies corporate governanceconcentrates on at least four important factors: Ensuring disclosures of all relevantinformation to shareholders and creditors; including business risk analyses; Building asystem of rules and voluntary practices that will guide the board of directors;Establishing independent audit committees composed of outside directors; Monitoring andcontrolling management. On the other hand developing economies focus on strengtheningand improving the legal and regulatory systems that will help ensure better enforcement ofcontracts and protection of property rights.

Your Company is committed to achieving and maintaining high standards of CorporateGovernance and places high emphasis on business ethics. Your Company has set up aRemuneration Committee under Annexure 1-D of SME Equity Listing Agreement which was laterreconstituted under the name 'Nomination and Remuneration Committee' pursuant toprovisions of Section 174 of The Companies Act 2013.

A report on corporate governance con rming compliance of conditions as stipulated underSEBI (Listing Obligations and Disclosure Requirements) Regulation 2015 has been includedin Annexure III of this report. The Company has laid down a well-de ned Code of Conductwhich fairly addresses the issues of integrity conflict of interest and con dentialityand stresses the need of ethical conduct which is the basis of good Governance. This codeis applicable to all members of the Board and the Senior Management Personnel. Thedeclaration regarding compliance with Veto Switchgears and Cables

Limited-Code of Conduct and Ethics for all Board Members and Senior ManagementPersonnel of the

Company has been included in Annexure VII of this report.

5. Directors and Key Managerial Personnel (KMP)

Change in directors and KMP during the year

On 13th February 2017 appointed Mr. Kanwarjeet Singh as an Independent (Non Executive)Director.

Name Of Director Designation Date of Appointment
1. Mr. Akshay Kumar Gurnani Executive Managing Director and CEO 27/08/2014
2. Mr. Narain Das Gurnani Whole Time Director and CFO 28/09/2016
3. Ms. Jyoti Gurnani Director 27/08/2014
4. Mr. Mohan Sukhani Non -executive Independent Director 31/08/2012
5. Mr. Govind Ram Thawani Non -executive Independent Director 31/08/2012
6. Mr. Kanwarjeet Singh Non -executive Independent Director 06/ 08/ 2017

Board Evaluation

Pursuant to the provisions of the Companies Act 2013 the Board has carried out anannual performance evaluation of its own performance that of its Committees andindividual Directors. Relevant details have been provided in the Corporate GovernanceReport.

I. For Labours:

For xing the Remuneration for the Labours Minimum Wages Act 1948 is applicable.Remuneration is

payable on Hours basis.

II. For Office Staff:

The Committee will recommend the remuneration to be paid to the Managing DirectorWhole-time Director KMP and Senior Management of the quantity required to run the Companysuccessfully. The relationship of remuneration to performance should be clear and meetappropriate performance benchmarks. Minimum 5% increment to the Management of the Companymay provide excess of remuneration on the basis of outstanding performance of employeeonly if the Company is not satisfied with the performance of the Employee than they canrestrict the increment. The remuneration should also involve a balance between xed andincentive pay re ecting short and long-term performance objectives appropriate to theworking of the company and its goals. a. Managing Director

The remuneration and commission to be paid to the Managing Director shall be inaccordance with the provisions of the Companies Act 2013 and the rules made thereunder.Increments to the existing remuneration/ compensation structure may be recommended by theCommittee to the Board which should be within the limits approved by the Shareholders. b.Directors

The remuneration/compensation/commission etc. to Directors will be determined by theCommittee and recommend to the Board for approval. c. Non executive Independent Directors

The Non Executive Independent Director may receive remuneration by way of Sitting Feesfor attending meetings of the Board thereof. Provided that the amount of such fees shallbe subject to ceiling/limits as provided under Companies Act 2013 and rules madethereunder or any other enactment for the time being in force. d. KMPs/ Senior ManagementPersonnel

The Remuneration to be paid to KMPs/Senior Management Personnel shall be based on theexperience qualification and expertise of the related personnel and governed by thelimits if any prescribed under the Companies Act 2013 and rules made thereunder or anyother enactment for the time being in force. e. Directors' and Of cers' Insurance

Where any insurance is taken by the Company on behalf of its Directors KMPs/SeniorManagement Personnel etc. for indemnifying them against any liability the premium paid onsuch insurance shall not be treated as part of the remuneration payable to any suchpersonnel.

This Policy is updated based on the provisions of the Companies Act 2013 and rulesmade thereunder and requirements of the relevant rules and regulations issued by SEBI fromtime to time. In case of any subsequent changes in the provisions of the Companies Act2013 or any other regulations which makes any of the provisions in the policy inconsistentwith the Act or regulations then the provisions of the Act or regulations would prevailover the policy and the provisions in the policy would be modi ed in due course to make itconsistent with Law. This Policy shall be reviewed by the Nomination and RemunerationCommittee as and when any changes are to be incorporated in the policy due to change inregulations or as may be felt appropriate by the Committee. Any changes or modi cation onthe policy as recommended by the Committee would be given for approval of the Board ofDirectors.

No. of meetings of the Board

Six (6) Board meeting were held during the year 2017-2018 and the gap between twomeetings did not

exceed four months. The dates on which the Board Meeting was held are as follows:

Detail of Board Meetings held:

Declaration by an Independent Director(s) and re-appointment if any

All Independent Directors of the Company have given declarations that they meet thecriteria of independence as laid down under Section 149 (6) of the Companies Act 2013 andregulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015. The terms & conditions for the appointment of Independent Directors are given onthe website of the Company and separately disclosed in the Corporate Governance Report.http://www.vetoswitchgears.com/investor/corporate-governance/indpedndent-drectors.

6. Committees of Board

There are currently four Committee of the Board which is as follows: a) AuditCommittee; b) Nomination Remuneration & Compensation Committee c) Corporate SocialResponsibility (CSR) Committee; d) Stakeholders' Relationship Committee

Details of all the Committees along with their composition charters DutiesResponsibilities and activities and meetings held during the year are provided in the“Report on Corporate Governance” a part of this Annual Report.

Name of Committee Composition of Committee
Audit Committee 1. Mr. Govind Ram Thawani - Chairman
2. Mr. Mohan Sukhani
3. Mr. Narain Das Gurnani
Nomination and Remuneration 1. Mr. Govind Ram Thawani - Chairman
Committee1 2. Mr. Kanwarjeet Singh
3. Mr. Mohan Sukhani
Shareholders'/Investors' Grievance 1. Mr. Govind Ram Thawani - Chairman
Committee 2. Mr. Narain Das Gurnani
3. Mr. Mohan Sukhani
Corporate Social Responsibility 1. Mr. Govind Ram Thawani - Chairman
Committee 2. Mr. Mohan Sukhani
3. Mr. Narain Das Gurnani

7. Risk Management

The Company has framed and implemented a Risk Management Policy to identify the variousbusiness risks. This framework seeks to create transparency minimize adverse impact onthe business objectives and enhance the Company's competitive advantage. The riskmanagement policy de nes the risk management approach across the enterprise at variouslevels including documentation and reporting.

8. Directors Responsibility Statement

The Board of Directors acknowledge the responsibility for ensuring compliances with theprovisions of Section 134(3) (c) read with Section 134(5) of the Companies Act 2013 inpreparation of annual accounts for the year ended 31st March 2018 and state that : (a) inthe preparation of the annual accounts for the financial year ended 31st March 2018 theapplicable accounting standards have been followed along with proper explanation relatingto material departures; (b) the Directors had selected such accounting policies andapplied them consistently and made judgments and estimates that are reasonable prudent soas to give a true and fair view of the state of affairs of the as at 31st March 2018 andprofit of the Company for that period; (c) the Directors have taken proper and sufficientcare for the maintenance of adequate accounting records in accordance with the provisionsof the Companies Act 2013 for safeguarding the assets of the Company and for preventingand detecting fraud and other irregularities; (d) the annual accounts have been preparedon a going concern basis; (e) proper internal financial controls have been laid down whichare adequate and are operating effectively.

(f) proper systems have been devised to ensure compliance with the provisions of allapplicable

laws and that such systems were adequate and operating effectively.

9. Related Party Transactions

All transactions entered with Related Parties for the year under review were on arm'slength basis and in the ordinary course of business and that the provisions of Section 188of the Companies Act 2013 and the Rules made thereunder are not attracted. Thusdisclosure in form AOC-2 in terms of Section 134 of the Companies Act 2013 is notrequired. Further there are no material related party transactions during the year underreview with the Promoters Directors or Key Managerial Personnel. The Company hasdeveloped a framework through Standard Operating Procedures for the purpose of identication and monitoring of such Related Party Transactions.

All Related Party Transactions are placed before the Audit Committee as also to theBoard for approval. Omnibus approval was obtained on a yearly basis for transactions whichare of repetitive nature. Transactions entered into pursuant to omnibus approval areaudited and a statement giving details of all Related Party Transactions are placed beforethe Audit Committee and the Board for review and approval.

The Company has put in place a mechanism for certifying the Related Party TransactionsStatements placed before the Audit Committee and the Board of Directors from anIndependent Chartered Accountant. The policy on Related Party Transactions as approved bythe Board of Directors has been uploaded on the website of the Company viz.www.vetoswitchgears.com. None of the Directors has any pecuniary relationship ortransactions vis-a-vis the Company. Pursuant to the provision of SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 the Board has framed a Policy on MaterialSubsidiaries and the same is available on Company's websitehttp://www.vetoswitchgears.com/investor/corporate-governance/policies-and-related-documentsunder the head Policy on Material Subsidiary.

However you may refer to Related Party transactions in the relevant notes of theStandalone financial

Statements.

10. Listing of Shares

The shares of the Company are listed at BSE Limited & National Stock Exchange ofIndia Ltd. and

the listing fee for the year 2017-18 has been duly paid.

11. Prevention of Insider Trading

In compliance with the provisions of Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations 2015 the Board has adopted a code ofconduct and code of practices and procedures for fair disclosure of unpublished pricesensitive information to preserve the con dentiality of price sensitive informationprevent misuse thereof and regulate the trading by Insiders. The code of practice andprocedures for fair disclosure unpublished price sensitive information is also availableon the Company's website i.e. www.vetoswitchgears.com.

12. Auditors and Auditor's Report

Statutory Auditors

The company as appointed M/s. K. M. Tulsian & Associates (Firm Registration No.111075W) as the Statutory Auditor(s) of the Company for a period of 5 years commencingfrom the conclusion of the 10th Annual General Meeting till the conclusion of 15th AnnualGeneral Meeting to be held in the year 2022 .

Our comments on financial statements referred to in the Auditor's Reports under Section145 of the Companies Act 2013 are given below: a) With regard to the Emphasis of Matterappearing in the Auditor's Report your attention is drawn to the notes forming part offinancial statements of the year which are self explanatory. b) With respect to thecomments of the Auditors in their report on the Consolidated Audit Report our responsesare given in the Notes to the financial Statements which is self-explanatory.

Cost Auditors

Pursuant to the provisions of Section 148 of The Companies Act 2013 the company isrequired to conduct cost audit as per Companies (Cost Record & Audit ) Rules 2014applicable from 1st April 2015. The Board of Directors on the recommendation of AuditCommittee has appointed M/s Rajesh & Company & Co. Cost Accountants (FirmRegistration Number No. 000031) as Cost Auditor to audit the cost accounts of the Companyfor the financial year 2018-19. As required under the Companies Act 2013 a resolutionseeking member's approval for the remuneration payable to the Cost Auditor forms part ofthe Notice convening the Annual General Meeting for their rati cation.

Secretarial Audit Report

The Board has appointed Ms. Nisha Agarwal Practicing Company Secretary to conductSecretarial Audit for the financial Year 2017-18. The Secretarial Audit Report for thefinancial Year ended 31st March 2018 is annexed herewith marked as Annexure V to thisReport. The Secretarial Audit Report does not contain any quali cation reservation oradverse remark.

Corporate Governance Certi cate

The Company is promptly submitting a “Quarterly Compliance Report on CorporateGovernance” as per SEBI (Listing obligations and Disclosure Requirements)Regulations 2015 with the Stock Exchanges. The certi cate from the Practicing Companysecretary Ms. Nisha Agarwal C.P. No. 8584 con rming compliance of conditions ofCorporate Governance as stipulated under SEBI (Listing Obligations and DisclosureRequirements) Regulation 2015 has been included in Annexures of this report.

Reservation and Qualification on Auditor Report

The report doesn't contain any reservation qualification or adverse remark.Information referred in Auditor's

Report are self-explanatory and don't call for any further comments.

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 areno significant and material orders that are passed by the regulators or courts or tribunalimpacting the going concern status and Company's operations in future.

However an appeal is pending with the Sales Tax Department Gujarat regardingassessment order

issued and the details have been provided in the Independent Auditors Report.

13. Extract of Annual Return

The details with respect to extract of Annual Return is available at Company's

website: http://www.vetoswitchgears.com/investor- zone/category/financial-information/reports/ .

14. Details in respect of adequacy of internal financial controls with reference to

the financial statements

The Company has in place adequate internal financial controls with reference tofinancial statements.

During the year such controls were tested and no reportable material weakness isobserved.

15. Depository System

Our Company's Equity Shares are available in dematerialized form through The NationalSecurities Depository Limited (NSDL) and The Central Depository Services of India (India)Limited (CDSL). The Company has set up requisite facilities for dematerialization of itsEquity Shares in accordance with the provisions of Depository Act 1996 with NationalSecurities Depository Limited and Central Depository Services (India) Limited. The Companyhas entered into agreements with both of the Depositories. Accordingly all shares postIPO of the Company is held in demat form.

16. Report under the Prevention of Sexual Harassment Act

As a good corporate citizen Veto is committed to a gender friendly workplace. It seeksto enhance equal opportunities for men and women prevent/stop/redress sexual harassmentat the workplace and institute good employment practices. Veto has established suitableprocesses and mechanisms to ensure issues such as sexual harassment if any areeffectively addressed. Maintaining an open door for repartees Veto encourages employeesto report any harassment concerns and is responsive to complaints about harassment or anyother unwelcome and offensive conduct. An Internal Complaints Committee has beenconstituted to enquire into complaints and recommend appropriate action whereverrequired. Veto demands demonstrates and promotes professional behavior and respectfultreatment of all employees. During the year no complaints of sexual harassment werereceived.

17. Conservation of energy technology absorption and foreign earning and outgo

Disclosure pursuant to Section 134(3)(m) of the Companies Act 2013 read with Rule 8(3)of the

Companies (Accounts) Rules 2014.

(A) CONSERVATION OF ENERGY

(i) Steps taken or impact on conservation of energy and the steps taken by the companyfor utilizing alternate sources of energy; Energy conservation measures taken Company hastaken several steps to conserve energy through its “Sustainability” initiatives.The Company continues its endeavor to improve energy conservation and utilization. TheCompany has always been conscious of the need for conservation of energy and has beensensitive in making progress towards this end. Energy conservation measures have beenimplemented at all the plants and of ces of the Company and special efforts are being puton undertaking specific energy conservation projects like :

1. Lighting: Efforts have been put by Company to reduce or optimize the lightingrequirements at all the plants. Replacement of Conventional Light fittings with LED lightxtures leading to savings in power at office areas. d) Installation of CFL LEDindicators Use of 54Wx4 T5 lamps for assembly area.

2. Replacement of old equipment with new/ energy efficient equipment.

3. Optimization of Electrical Equipment: In addition to the existing controls on primeproduction equipment and existing prime utilities equipment electrical equipment modications / additions being done are continuous monitoring of Power factor of plant on dailybasis and redesign of pay off xtures in cable division to reduce energy consumption by30%.

4. Company believes in sharing and implementing best practices across all plants &stage wise replacement of conventional light fittings to LED light fittings is underprogress across the manufacturing units. Impact of measures reduction of energyconsumption. The above measures have resulted in optimizing energy consumption and savingscost of production reduction on carbon emissions and processing time.

Capital investment on energy conservation equipments Efforts have been put by Companyto reduce or optimize the energy requirements at all the plants. Company encouragescapital investment in energy-saving equipment's plants or machinery and has invested asignificant amount on the same.

(B) ENVIRONMENT HEALTH AND SAFETY

VETO is committed to caring for people and the planet by integrating environmental andsafety principles in all aspects of its business are it from procurement material-usemanufacturing of sustainable products creating awareness through marketing andinnovation/R&D for better products and processes. We constantly monitor and better ourenvironmental and occupational health and safety performance through our internal riskmanagement exercise. At the compliance level your Company conforms to all applicableregulatory Environmental Health & Safety (EHS) requirements wherever it operates. OurCompany is sensitive to environmental and resource conservation and its manufacturingphilosophies ensure safety of the worker and surroundings. Being in a non-pollutingcategory of business it has minimal impact on the environment but has a huge positiveimpact on the local community. RoHS or 'Restriction of Hazardous Substances' compliance inall its products like CFLs cables PCBs etc. ensures safety across the product lifecycle. Our Company strongly believes and promotes energy conservation not only through itsproducts but also within the premises. Energy conservation measures have been adopted atall the plants. Our Company follows best practices for health and safety. Employees andworkers are regularly trained by industry experts on issues of occupational and industrialhealth & safety rst-aid and environment management. Healthy lifestyle and well-beingare also promoted as a culture at VETO. Our Company also provides life insurance coverpersonal accident cover and robust medical & health policies to all eld staff againstany unfortunate incident. VETO India strongly believes in maintaining a work-life balanceand therefore follows strict in-and-out work-timings. This has gone a long way inmaintaining a healthy happy and motivated workforce.

(C) TECHNOLOGY ABSORPTION

The Company is putting continuous efforts in acquisition development assimilation andutilization of technological knowledge through its wide advance engineering projectportfolio. This has enabled the Company to keep abreast with the latest developments inproduct technology manufacturing process and methods quality assurance and improvementmarketing management systems and benefit out of mutual experience. To develop our productpipeline we commit substantial time efforts funds and other resources for R&D. Ourprocesses and products currently under development if and when fully developed andtested may not perform as we expect and we may not be able to successfully and pro tablyproduce and utilize such products or processes. Therefore our investments in R&D andnew product launches could result in higher costs without a proportionate increase inrevenues.

Company is carrying out the following activities to fulfill short term and long term

business goals:

Upgradation of existing product and processes to save cycle time energy consumptionand overall operational ef ciency.

Import substitution and identi cation of new raw materials for development.

Technology support to all plants to improve ef ciency and enable business growth.

Optimization of products and processes to minimize waste generation and addressenvironmental and safety concerns.

Development of smart test methods to speed up testing of incoming raw materials.

Development of in house domain expertise to support product development.

Focus on in house product development in the area of smart internet base solution etc.

The benefits derived like product improvement cost reduction product development orimport substitution:

(D) Detail of Foreign Exchange Earnings and Outgo.

During the financial year Company's Foreign exchange earned in terms of actual in owsyear was 16409976 INR and the Foreign Exchange outgo in terms of actual out ows(including machinery imported) was 2173177 INR. Hence net foreign exchange in flow is14236799.374 INR. The information on foreign exchange and outgo is furnished in therelevant notes to the accounts of Standalone financial results

18. Credit Rating

Your Company has been reaf rmed long-term rating of BBB+ (ICRA triple B plus) by ICRALimited.

The outlook of long term rating is “Stable”.

19. Employee Stock Options under ESOP 2015

The Company had vide special resolution passed in the Annual General Meeting held on26th August 2015 has approved the company's ESOP Scheme 2015. The purchase price of theoptions was approved on 23.05.2016 under the supervision of the Nomination andRemuneration Committee of the Board of Directors of the company. Further Pursuant to theexercise of stock options under Employee Stock Option Scheme 2015 (“ESOP Scheme2015”). In accordance with the terms and conditions of the plan the company hasgranted 916355 stock options on 23.05.2016 and Vested on

23.05.2017 in single tranche. The said options were exercisable within a period of 1 to3 years from the

date of vesting and settled by way of issue of equity shares. The details of the sameare as under:

Vesting period 1 to 3 years
Exercise period 3 Years from the date of Vesting of Options
Pricing Formula Each option carries the right to the holder for one equity share of the company at Rs. 50
Brief details of option granted - The above options have vesting period of 1 to 3 years.
- The options shall be exercisable within a period of 3 years after vesting of the same.
- The options carry the right to apply for equivalent number of equity shares of the Company.
Employee wise details of options granted to
- Jyoti Gurnani 900
i) senior managerial personnel - Akshay Gurnani 669855
ii) identified employees who were granted option during any one year equal to or exceeding 1% of the issued capital (excluding outstanding warrants and conversions) of the company at the time of grant

20. Management Discussion and Analysis

Management Discussion and Analysis report is attached herewith forms part of thisreport. Summary of performance and various businesses and functions of the Company is asfollows:

i. Economy and Markets

India is well on its way to becoming a global supplier of goods and services. Anefficient power supply system is the key ingredient for a country's economic growth andquality of life. Sources of power generation range from conventional sources such as coallignite natural gas oil hydro and nuclear

power to viable non-conventional sources such as wind solar and agricultural anddomestic waste.

At present India has on installed generating capacity of over 305.5 GW/ however thepeak demand gap has increased to about 16% recently due to cool shortages. The Gol has seton ambitious goal in its 12th plan for generation capacity addition of about 88537 MW.Indicaling significant growth in the power transmission sector the CEA has estimated oninvestment of Rs 2.6 lakh Cr till 2022.These and other estimates form the base for a draftNotional Electricity Plan-Volume 11/ which would be the basis for investment and policyplanning in the sector. Also Inter-regional capacity addition during the 13th plan(2017-22) is estimated at 45/700 Mw from the present 63/650 Mw by the plan end said CEAin the draft. The investment gurer it said included on estimate of Rs 30/000 crore intransmission systems below 220 kv. About Rs 1.6 lakh Cr would come from states and theother Rs 1 lakh crore from Power Grid Corporation of India. The govt is planning toincrease the size of projects and scope of work in transmission.

The Electrical Equipment Industry tends to be more cyclical than the majority of groupscovered by Value Line in terms of product demand. Sales are tied largely to overalleconomic conditions with an emphasis on the industrial utility and constructionsectors. Earnings may also be driven by consumer- based industries as well as capitalspending by manufacturing rms and government outlays. On the cost side too uctuations inthe price of commodities such as steel may significantly affect pro tability among thisgroup.

The Government of India is taking a number of steps and initiatives like 10-year taxexemption for solar energy projects etc. in order to achieve India's ambitious renewableenergy targets of adding 175 GW of renewable energy including addition of 100 GW of solarpower by the year 2022. The government has also sought to restart the stalled hydro powerprojects and increase the wind energy production target to 60 GW by 2022 from the current20 GW. With electricity production of 1201.543 BU in India in FY18 the country witnessedgrowth of around 55.72 per cent over the previous scal year. Over FY10 FY18 electricityproduction in India grew at a CAGR of 5.69 per cent. India is world's third largestproducer and fourth largest consumer of electricity in the world.

Wires and cables play an indispensable role in today's digitally-enriched life and ndextensive usage across a number of applications in several industries. The continuouslyrising set of applications of wires and cables across the burgeoning power automotivetelecommunication and construction industries are expected to bode well for the globalconsumption of wire and cable materials in the next few years.

Market research analysts have predicted that the electric wire and cable market inIndia will grow steadily during the next four years and post a CAGR of almost 16% by 2020.The wire and cable industry analysis identi es the growth in renewable power generation tobe one of the primary factors for the growth of the electric cable and wire market. Thiswill create a significant demand for electrical wires and cables mainly because of thelack of a transmission and distribution (T&D) infrastructure at locations whererenewable energyresources are set up. Moreover the expansion of the existing renewablepower generation plants in the emerging countries will also result in the increasingdemand.

The main customers for the wire and cable industry are the automotivetelecommunication and construction industries. In the past few years these three havewitnessed a rapid expansion and have led to an annual growth of about 25% in India.

India could become the world's first country to use LEDs for all lighting needs by2019 thereby saving Rs

40000 crore (US$ 6.23 billion) on an annual basis.

One of the major tax reforms the Goods and Services Tax (GST) Amendment Bill passedduring the year aims at streamlining the country's complex tax system reducefragmentation in markets lower business costs and widen the tax base. Robustimplementation of these legislative changes will be key to boost prospects of theorganised market.

We have proposed to expand our manufacturing capacity so as to meet the increaseddemand both in domestic and foreign markets. De-licensing and Removal of Tariffs for theIndustry Low Entry Barriers Increased Demand for Housing Increased Growth in theEmerging Markets and in the Production of Renewable Energy and Increased Growth in theEmerging Markets and in the Production of Renewable Energy are also our basic growthdrivers of the market. We are also looking forward to housing projects of Government andsemi-government agencies.

Source: http://www.openpr.com/ http://ieema.org/ wire & cable India;https://www.technavio.com https://www.prnewswire.com/;https://www.ibef.org/industry/power-sector-india.aspx; ii. Market Overview

Indian power sector is undergoing a significant change that has rede ned the industryoutlook. Sustained economic growth continues to drive electricity demand in India. TheGovernment of India's focus on attaining 'Power for all' has accelerated capacity additionin the country. At the same time the competitive intensity is increasing at both themarket and supply sides (fuel logistics nances and manpower). Total installed capacityof power stations in India stood at 343.79 Gigawatt (GW) as on April 2018.

Control panel & Switchgears

India Switchgear Market (2017-2022) Report says that growing T&D network and ruralelectri cation program coupled with infra development are the key factors driving theswitchgear market in India. Govt schemes & initiatives such as UDAY & DDUGJY areexpected to further fuel the growth of switchgear market in the forecast period. Accordingto 6Wresearch report India switchgear market is projected to reach $3.7 Billion by 2022.

Further govt initiatives to increase the penetration of clean energy is also a majorsource of growth for

the switchgear market in India.

Veto Switchgears and Cables Ltd has received on order of 6 lacs pieces per annum. TheCompany is in the process of establishing a LED factory in its existing facility in VasaiMaharashtra. The production is estimated to start from Oct'18 with on estimated CAPEX of2.5 Cr for the production of Panel Lights Tube Lights Flood Lights ete. The factory'stotal estimated turnover is Rs 30 Cr/annum .

The international market showing the price hike by 2024 for low voltage switchgearindustry further the growing in demand for electrical and power sector in addition to theurbanization have increased the demand for electrical products and electrical protectionequipment.

The Indian power sector has an investment potential of Rs 15 trillion (US$ 225 billion)in the next 4-5 years thereby providing immense opportunities in power generationdistribution transmission and equipment. The govt's immediate goal is to generate twotrillion units (kilowatt hours) of energy by 2019. This means doubling the currentproduction capacity to provide 24x7 electricity for residential industrial commercialand agriculture use. The Gol is taking a number of steps and initiatives like 10- year taxexemption for solar energy projects etc. in order to achieve Indio's ambitious renewableenergy targets of adding 175 GW of renewable energy including addition of 100 GW of solarpower by the year 2022. The govt has also sought to restart the stalled hydro powerprojects and increase the wind energy production target to 60-GW by 2022 from the current20 GW.

Wires and Cables

The Indian wire and cable industry is growing satisfactorily and getting more and moreconsolidated and becoming largely organized now. However slowdown in constructionactivity has been one of the major factors for a sluggish growth. Construction is also oneof the core sectors of Indian economy and future of the industry is important forcommodities. Construction cables and wire sector anticipated to see steep growth indemands in coming days owing to huge government's spending in infrastructure smartcities real estate boom and housing explosion.

An industry delegation highlighted the sharp rise in tax rate to Gal. Manufacturersalso questioned the logic of placing a higher tax when a sig. portion of the industryremains unorganized. A lower tax rate would have certainly helped the industry becomingmore organized. The unorganized sector seems to continue to thrive as recycled & scrapcopper could be easily smelted to make cheap items.

The Central Government's 'Housing for All by 2022' (20mn houses for urban poor and 30mnfor rural poor) and Smart Cities (development of 100 cities) missions promise to triggerfast-paced rollout of new homes. This should usher in multi-year growth for electricalproducts and appliances. Increasing consumer focus on aesthetics and energy ef ciency hasalso resulted in notable shift towards branded products. With its ability to offercompetitive pricing superior product range & quality upgraded technology andinnovations more safety features and increased brand awareness VETO is well placed tooffer an enriching consumer experience.

iii. Competition

The market consists of a number of international and regional or local vendors who faceintense competition from the unorganized vendors. The regional and unorganized players inthe market are offering products at a comparative price which induces the well-establishedinternational electric wire and cable manufacturers to focus on differentiating theirproducts to sustain their market shares. In addition to innovative product offeringscable and wire manufacturers are also following strategies such as mergers andacquisitions to acquire new technologies and expand their customer reach.

The leading vendors in the market are -

Finolex Cables

Havells India

KEI Industries

Polycab Wires

The other prominent vendors in the market are Cable Corporation of India AparIndustries Limited Cords Cable Industries KEC International LS Cable India ShilpiCable Technologies Universal Cable and V-Guard Industries.

iv. Marketing Setup

Veto holds a major part of market share of electrical accessories in India. The companyhas a strong and hardworking team of marketing professionals dealers and distributors.Our Promoters have vast experience of marketing of wires and cables and electricalaccessories & other allied products. They have been manufacturing and marketing theseproducts for past over 35 years. We have a good reputation among our dealer network whichconsists of more than 2000 in number. The sale price of the components to be manufacturedis decided based on design complexities material process quantity period of supplyetc. Your Company has major earning in the state of Rajasthan and Gujarat. But this yearour focus is to widen and cover more and more states of India. Almost 10 stated havebecome a major part of our distribution Network stating Maharashtra Punjab MadhyaPradesh Haryana Uttar Pradesh Jharkhand Kerela New Delhi and Assam . The company hasbroadened its network and distribution. We have also had major success in some of thebiggest cities of UAE. The company and its Board have started working towards making Vetoa globally established brand. Our products are marketed in both domestic and internationalmarkets.

v. Export obligation

As on the date we do not have any export obligations.

vi. Strength

Established brand in North West India and central;

Experienced management team;

Organized and comprehensive product offering;

Established reputation for quality products;

Driving growth through innovation and marketing;

Our relationship with customers;

Our relationship with more than 2000 dealers;

Dedicated team of technical manpower; vii. Weakness

Player in regional market.

Any avoidance of rules of Govt. caused under unavoidable circumstances may have anadverse impact on the project.

viii. Opportunity

The location of the unit is the hub of industry of the multiproduct category. This willcause a competition and that will help the customer to differentiate between the averageand the best product. The importers will get variety of the products which will be ahealthy situation for the Industry ultimately.

The Company has many opportunities in view of the increasing demand for wires &cables and electrical accessories.

Decrease in copper prices. ix. Threats

Our contingent liabilities not provided for if crystallized could adversely affectour financial condition.

A contingent liability is a possible obligation that arises from past events whoseexistence will be con rmed by the occurrence or non-occurrence of one or more uncertainfuture events beyond the control of the Company or a present obligation that is notrecognised because it is not probable that an out flow of resources will be required tosettle the obligation. A contingent liability also arises in extremely rare cases wherethere is a liability that cannot be recognised because it cannot be measured reliably. TheCompany does not recognise a contingent liability but discloses its existence in thefinancial statements unless the probability of out flow of resources is remote.Provisions contingent liabilities contingent assets and commitments are reviewed at eachbalance sheet date.

The loss of or shutdown of operations at our production facilities may have a materialadverse effect on our business financial condition and results of operations.

The breakdown or failure of our equipments and/ or civil structure can disrupt ourproduction schedules resulting in performance being below expected levels. In additionthe development or operation of our facilities may be disrupted for reasons that arebeyond our control including explosions res earthquakes and other natural disastersbreakdown failure or sub-standard performance of equipment improper installation oroperation of equipment accidents operational problems transportation interruptionsother environmental risks and labour disputes. Our production facilities are also subjectto mechanical failure and equipment shutdowns. Our machineries may be susceptible tomalfunction. If such events occur the ability of our facilities to meet productiontargets may be adversely affected which may affect our business financial condition andresults of operations.

Low cost end-to-end business model being adopted by existing or new competitors.

Heightened competitive intensity with externally-funded players looking to driveaggressive strategies in the market.

Disclaimer Clause

Statements in Management Discussion and Analysis describing the Company's objectivesprojections estimates expectations or predictions may be forward looking statementswithin the meaning of applicable securities laws and regulations. Actual results coulddiffer materially from those either expressed or implied. Important factors that couldmake a difference to the Company's operation include among others economic conditionsaffecting demand/supply and price conditions variation in prices of raw materialschanges in Government regulations tax regimes economic developments and other incidentalfactors.

Acknowledgment

We thank our customers vendors investors and bankers for their intense supportthroughout the year. We place on record our appreciation of the contribution made by ouremployees at all levels. We thank the Government of India particularly the Ministry ofCommerce Ministry of Finance Ministry of Corporate Affairs the Custom and ExciseDepartments Income Tax Department the Reserve Bank of India the State Governments andother government agencies for their support and look forward to their continued supportin the future.

for and on behalf of the Board of Directors

Date : 07/09/2018
Sd/-
Sd/-
Narain Das Gurnani
Akshay Kumar Gurnani
Place : Jaipur
Whole-time Director & CFO

Managing Director & CEO

DIN: 01970599

DIN: 06888193