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Garden Silk Mills Ltd.

BSE: 500155 | NSE: GARDENSILK | Series: NA | ISIN: INE526A01016 | SECTOR: Textiles - Weaving

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Garden Silk Mills is not traded on NSE in the last 30 days

Annual Report

For Year :
2018 2016 2015 2014 2013 2012 2011 2010 2009

Director’s Report

Dear Members,

The Directors present the 39th Annual Report together with the Audited Financial Statements of the Company for the financial year ended 31st March, 2018.The Management’s Discussion and Analysis Report as required pursuant to Listing Regulations 2015 forms part of this Report.

Financial Results

The Company’s financial performance during the year ended 31st March, 2018 as compared to the previous year, is summarised below:

(Rs. in Crore)

2017-18

2016-17 *

Sales / Revenue from Operations (Net of Excise Duty) **

3033.40

2468.21

Earnings Before Interest, Tax and Depreciation (EBITDA)

180.76

148.40

Less: Finance Costs

188.62

167.32

Profit / (Loss) before Depreciation and Tax

(7.96)

(18.92)

Less: Depreciation

66.25

64.47

Less: Impairment Losses

14.86

0.00

Profit / (Loss) before tax

(88.97)

(83.39)

* Previous year figures have been regrouped where necessary and have been re-stated as per Ind AS.

** Effective July 01, 2017, sales are recorded net of GST whereas earlier sales were recorded gross of excise duty which formed part of expenses. Hence revenue from operations for the year 2017-18 are not comparable with the previous year corresponding figures.

Indian Accounting Standard (Ind AS)

Your Company has adopted Indian Accounting Standards (‘Ind AS’) for the accounting period beginning on 1st April, 2017 pursuant to Ministry of Corporate Affairs Notification dated 16th February, 2015, notifying the Companies (Indian Accounting Standard) Rules, 2015. Accordingly, the Financial Statements for the year ended on 31st March, 2018 have been prepared in accordance with Ind AS, prescribed under Section 133 of the Companies Act, 2013 (‘the Act’) read with the relevant rules issued thereunder and the other recognized accounting practices and policies to the extent applicable. The Financial Results for all the periods of 2017-18 presented have been prepared in accordance with Ind AS.

Review of Operations

In FY 18 Garden Silk Mills Ltd. has delivered strong volume growth and maintained a leadership position in the major segments of its business activities i.e. Polyester Chips and POY / FDY (including processed yarn).

Improved domestic and export demand led to about 23% year-on-year growth in total revenue from operations at Rs. 3033.40 Crore as compared to Rs. 2468.21 Crore in the previous year. Income from exports for FY 18 was higher by about 46% at Rs. 589.37 Crore compared to Rs. 404.56 Crore in the previous year.

Despite a challenging and competitive business environment, your Company achieved Operating EBITDA (earnings before interest, tax and depreciation) of Rs. 180.76 Crore as compared to Rs. 148.40 Crore in the previous year. On a consolidated basis, EBITDA for FY 18 increased by 23% to Rs. 187.44 Crore from Rs. 150.71 Crore in the previous year.

Total sale of chips in volume was higher at 160,771 MT for the year 2017-18 as compared to 142,165 MT in the previous year. In value terms also your Company achieved higher sale of chips for FY18 at Rs. 1,112.04 Crore as compared to Rs. 918.68 Crore in the previous year. Higher exports were a key contributor to this performance.

We achieved higher production of chips (including melt), during 2017-18 at 319,979 MT as compared to 277,714 MT in the previous year. In yarn segment, your Company achieved higher production of spun polyester filament yarn (POY/FDY) at 176,630 MT for FY 18 as compared to 155,142 MT in FY 17. Equated (standardised) production for both POY and FDY reached record highs.

The volume of sales of polyester filament yarn (PFY) including processed yarn in FY 18 also increased at 182,429 MT as against 148,427 MT in the previous year FY 17. Sale of PFY (including processed yarn) in value terms also increased in FY 18 at Rs. 1,808.32 Crore as compared to Rs. 1,502.65 Crore in FY 17.

During the year, the demand for Fabrics remained subdued, mainly because of the impact of GST implementation on Textiles. The wholesale / retail trade took it’s time to come to terms with the tax and procedures imposed on them for the first time.

The Company’s improved EBITDA performance has been possible despite extremely tight working capital conditions in the face of 30% increase in raw material costs and rising fuel prices.

With the arrival of GST the company has achieved a level playing field with industry players having sales tax exemptions in Union Territories. This has materially helped our performance in the domestic market and polyester yarn margins generally improved for the company. Yet, the local markets still remain weak as the fragmented and unorganised downstream textile sector has not fully adjusted to the requirements mandated by GST. Our profitable exports to quality customers have demonstrated Garden’s adaptability and global competitiveness, and have reduced pressure of low margin sales in the domestic market.

The Company’s spinning plants achieved record utilisation levels and CP throughput was the highest in last five years. All continuous plants (except for CP3 which remains shut) are running at close to 100% and steps are being taken to further improve output with still better energy efficiencies. Overall spinning and CP efficiencies, first-grade production and efficiency were very high in the year under review. High energy costs are a matter of some concern and were a significant contributor to the increase in overall manufacturing expenses for FY 17-18.

The Company is continuously working on increasing/modifying its supplier base to reduce cost and lead time and ensure uninterrupted supply of raw materials and other inputs. The Company simultaneously reviews its policies and practices to adjust the inventory level of both raw materials and finished goods to reduce the impact of volatility in raw material prices while ensuring availability of sufficient stock for optimum production plans and supply of finished goods. Your Company maintains its focus on cost reduction at the manufacturing level via its continuous improvement program.

Your Company continues to have a clear price and product leadership in its key specialty yarn product segments: especially cationic, fine-denier and spandex-covered yarns. It is also an important player in mother-yarn and nylon yarns. It continues to be perceived in the market as a premium producer of quality chips, yarn and fabric even for its commodity products.

Dividend

Considering the loss incurred by the Company, your Directors do not recommend any dividend on equity shares for the financial year 2017-18.

Transfer to Reserves

In absence of distributable profits / earnings, it is not proposed to transfer any amount to reserves for the financial year 2017-18.

Change in the Nature of Business, if any

Garden Silk Mills Ltd. is one of India’s leading man-made-fibre based textile companies. It is a vertically integrated manufacturer of a wide range of Polyester Chips, Polyester Filament Yarns (PFY), Preparatory Yarns, Woven (Grey) Fabric as well as Dyed and Printed Sarees and Dress Materials. During the year under review, there was no change in the nature of business of the Company.

Going Concern Status

The Company has term loans, working capital loans and other financing arrangements from various banks and other lenders. These lenders have declared their arrangements with the Company as non-performing asset since the Company has defaulted in repayment of principal, interest and other penal dues. The Company’s net-worth as at the year-end is negative mainly due to accumulated losses. Although the Company has shown an improvement in its operating income for the year, the Company continues to face significant pressure on its financial resources. The Company is in discussions with its consortium of lenders for financial restructuring arrangement including identifying a suitable investor. The lenders have expressed optimism about the successful closure of above resolution in a time-bound manner and the company has thus accordingly prepared financial results on a going-concern basis.

Consolidated Financial Statements

As stipulated by Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations, 2015’), the Company has prepared Consolidated Financial Statements in accordance with the applicable accounting standards as prescribed under the Companies (Accounts) Rules, 2014 of the Companies Act, 2013 (‘the Act’). The Consolidated Financial Statements reflects the results of the Company and that of its subsidiary. As required under Regulation 34 of the Listing Regulations, 2015, the Audited Consolidated Financial Statements together with the Independent Auditors’ Report thereon is annexed and forms part of this Report.

Share Capital

The Paid-up Equity Share Capital of the Company as on 31st March, 2018 was Rs. 42.08 Crore. There was no public issue, rights issue, bonus issue or preferential issue etc. during the year. The Company has not issued shares with differential voting rights, sweat equity shares, nor has it granted stock options. As on 31st March, 2018, none of the directors of the Company hold instruments convertible into equity shares of the Company.

Subsidiary, Joint Venture and Associate Companies

The Company has one wholly owned overseas subsidiary namely GAIA International FZE, U.A.E.. GAIA International FZE is a free zone establishment and is registered with the Ajman Free Zone, Ajman, U.A.E. The Company is registered to carry out the business of trading in textile and ready-made garments including import and export.

Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, the statement in Form AOC-1, containing salient features of the financial statement of the Company’s subsidiary is forming part of the Consolidated Financial Statements.

Directors and Key Managerial Personnel

The Board of Directors consists of 10 (ten) members, of which 5 (five) are Independent Directors. The Board also comprises of one woman Independent Director.

As per the provisions of Section 152(6) of the Companies Act, 2013 and the Company’s Articles of Association, Shri Alok P. Shah (DIN: 00218180) shall retire from the Board by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment as a Director of the Company. The Board recommends his re-appointment.

The term of office of Shri Yatish C. Parekh, as an Independent Director, will expire on 31st March, 2019. The Board of Directors, on recommendation of the Nomination and Remuneration Committee has recommended re-appointment of Shri Yatish C. Parekh, as an Independent Director of the Company for a second term of 5 (five) consecutive years on the expiry of his current term of office. The members are requested to approve his appointment in the ensuing annual general meeting.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence prescribed under the Act and the Listing Regulation.

During the year, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

The information as required to be disclosed under regulation 36(3) of SEBI Listing Regulations, 2015 in case of re-appointment of the directors is provided in the Notice of the ensuing annual general meeting.

There was no other change in the directors and KMP during the year under review. Detailed information on the directors is provided in the Corporate Governance Report.

Managerial Remuneration

The remuneration paid to the Directors is in accordance with the Remuneration Policy formulated in accordance with Section 178 of the Companies Act, 2013.

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided as Annexure C.

The details of remuneration paid to the Directors including Executive Directors of the Company are given in Form MGT-9 forming part of the Directors Report.

Corporate Governance

Your Company reaffirms its commitment to Corporate Governance and is fully compliant with the conditions of Corporate Governance stipulated in Clause ‘C’ of Schedule V on Annual Report pursuant to Regulation 34(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. A separate section of disclosure on Corporate Governance and a certificate from M/s Sharp and Tannan, Chartered Accountants, Statutory Auditors of the Company in this regard, are annexed hereto and forms part of the Report. The auditor’s certificate for the year 2017-18 does not contain any qualification, reservation, adverse remark or disclaimer.

All Board members and Senior Management personnel have affirmed compliance with the Code of Conduct for the year 2017-18. A declaration to this effect signed by the Managing Director of the Company is contained in this Annual Report. The Managing Director and CFO have certified to the Board with regard to the financial statements and other matters as required under regulation 17(8) of the SEBI Listing Regulations, 2015.

Audit Committee

The Audit Committee of the Company comprises of three Independent Directors. The composition of directors and other details are provided in the Corporate Governance Report of the Company.

All the recommendations made by the Audit Committee during the year were accepted by the Board. During the year under review, neither the statutory auditors nor the secretarial auditors has reported to the Audit Committee under Section 143(12) of the Companies Act, 2013, any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in the Directors’ Report.

Pursuant to the provisions of Section 177 of the Companies Act, 2013 and Listing Regulations, 2015, the Company has established a vigil mechanism through the Committee, wherein the genuine concerns can be expressed by the employees and directors. The Company has also provided adequate safeguards against victimization of employees who expressed their concern. The Company has provided the details of the vigil mechanism in the Whistle Blower Policy in their Corporate Governance Report and also posted these on the website of the Company.

Corporate Social Responsibility Committee

The Company has constituted a Corporate Social Responsibility (CSR) Committee in accordance with Section 135 of the Companies Act, 2013, comprising of three Directors including Independent Director.

For the current financial year 2017-18, as the average profits for the last three years is negative, the requirements for spending based on average profits is not applicable. However, the Company has voluntarily spent an amount of Rs.0.91 Lacs towards various education promotion and social welfare related programs during the year.

The CSR Committee will further continue to identify the project which can be covered under the CSR guidelines in compliance with the CSR objectives and policy of the Company.

The report as per Section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility Policy) Rules, 2014 is attached as Annexure B to this Report.

Auditors and Auditors’ Report

Pursuant to the provisions of section 139 of the Companies Act, 2013, the members of the Company at the 38th Annual General Meeting held on 20th September, 2017 appointed M/s. Sharp & Tannan Associates, Chartered Accountants (Firm Registration No.109983W) as statutory auditors of the Company from the conclusion of 38th Annual General Meeting till the conclusion of 43rd Annual General Meeting, covering one term of five consecutive years, subject to ratification by the members at each intervening Annual General Meeting.

In view of the amendment to the said section 139 through the Companies (Amendment) Act, 2017 notified on 7th May 2018, ratification of auditor’s appointment is no longer required. However, as required under section 142 of the Companies Act, 2013, resolution at item No.3 of the Notice of AGM is proposed for approval of members for authorising the Board of Directors of the Company to fix Auditors’ remuneration for the year 2018-19. The members are requested to approve the same.

The Notes on financial statement referred to in the Auditors’ Report are self-explanatory and do not call for any further comments. The Statutory Auditors’ Report for the year 2017-18 does not contain any qualification, reservation, adverse remark or disclaimer made by Statutory Auditor. There is no incident of fraud requiring reporting by the auditors under Section 143(12) of the Companies Act, 2013.

Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013, read with the Rule 14 of the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records of the Company are required to be audited. The Directors, on the recommendation of the Audit Committee, appointed M/s Smit Manubhai & Associates, Cost Accountants, (Firm Registration Number 2502), to audit the cost accounts of the Company for the financial year ending 31st March, 2019 on a remuneration of Rs. 1.75 Lacs plus out of pocket expenses and applicable taxes. The remuneration payable to the Cost Auditor is required to be ratified by the shareholders at the ensuing AGM.

Secretarial Auditor and Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company has appointed, Shri Kunjal Dalal of K. Dalal & Co., Practicing Company Secretaries, (CP No.3863), Surat to conduct the Secretarial Audit of the Company. Secretarial Audit Report for the year 2017-18 issued by him in the prescribed form MR-3 is annexed to this Report. The said secretarial audit report does not contain any qualification, reservations or adverse remark or disclaimer made by the Secretarial Auditor.

Internal Auditors

Pursuant to the provisions of Section 138 of the Companies Act, 2013, the Board of Directors of the Company have appointed Shri Piyush Patel, Chartered Accountant (ICAI Membership NNo.116769) as Internal Auditor of the Company, for the financial year 2018-19.

The audit committee of the Board of Directors in consultation with the Internal Auditor formulates the scope, functioning, periodicity and methodology for conducting the internal audit.

Directors’ Responsibility Statement

Pursuant to the requirements of Section 134(3)(c) read with Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability confirm that:

a) in the preparation of the annual accounts for the year ended 31st March, 2018, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;

b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2018 and of the loss of the Company for the year ended on that date;

c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) they have prepared the annual accounts on a going concern basis;

e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory, cost and secretarial auditors and external consultant(s) and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company’s internal financial controls were adequate and effective during FY 18.

Number of meetings of the Board

Five Board Meetings were duly convened and held during the year. The Directors actively participated in the meetings and contributed valuable inputs on the matters brought before the Board from time to time. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and Listing Regulations. Detailed information is given in the Corporate Governance Report.

Board evaluation

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17(10) of Listing Regulations, 2015, the Board has carried out an annual performance evaluation of its own performance and that of its statutory committees viz. Audit Committee, Stakeholder Relationship Committee, Nomination and Remuneration Committee and Corporate Social Responsibility Committee and that of the individual Directors. The evaluation of each of the directors was done, inter-alia, on the basis of their advisory role and contribution in the decision making.

The Nomination and Remuneration Committee has defined the evaluation criteria for the Performance Evaluation of the Board, its Committees and individual Directors. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

Independent Directors’ Meeting

In compliance with the requirements of Schedule IV of the Companies Act, 2013, a meeting of the Independent Directors was held on 20th February, 2018, without the participation of the Executive Directors or Management personnel.

The Independent Directors carried out performance evaluation of Non-Independent Directors and the Board of Directors as a whole, performance of Chairman of the Company, the quality, contents and timelines of flow of information between the Management and Board, based on the performance evaluation framework of the Company.

Declaration of Independent Directors

All the Independent Directors have given a declaration that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and there is no change in their status of independence. As required under Section 149(7) of the Companies Act, 2013, the said declaration was placed in the Board Meeting held on 30th May, 2018.

Familiarisation Programme

The Company has put in place an induction and familiarisation programme for all its Directors including the Independent Directors so as to associate themselves with the nature of the industry in which the Company operates. Directors are periodically advised about the changes effected in the Corporate Laws, Listing Regulations with regard to their roles, rights and responsibilities as Director of the Company. The familiarisation programme for Independent Directors in terms of the provisions of Regulation 46(2)(i) of Listing Regulations, is uploaded on the website of the Company.

Contracts or Arrangement with Related Parties

All contracts / arrangements / transactions entered by the Company during the financial year with Related Parties were in its Ordinary Course of Business and on arms’ length basis.

Pursuant to section 177 of the Companies Act, 2013 and regulation 23 of SEBI Listing Regulations, 2015, all Related Party Transactions were placed before the Audit Committee for its approval.

There were no materially significant transactions with related parties during the financial year under review, which were in conflict with the interest of the Company.

Pursuant to Section 134 of the Companies Act, 2013 and Rules made thereunder, particulars of transactions with related parties as required under section 188(1) of the Companies Act, 2013, read with Rule 8(2) of Companies (Accounts) Rules, 2014 is annexed with this Report in Form AOC-2 as Annexure E.

Your Directors draw attention of the members to Note No.31 to the financial statements which sets out related party disclosures.

As required under Regulation 23 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has formulated a policy on Related Party Transactions which has been put up on the website of the Company. The Company’s management ensures total adherence to the approved Policy on Related Party Transactions to establish Arm’s Length Basis without any compromise.

Secretarial Standards

Pursuant to the approval given on 10th April, 2015 by the Central Government to the Secretarial Standards specified by the Institute of Company Secretaries of India, the Secretarial Standards on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) came into effect from 1st July, 2015. The said standards were further amended w.e.f. 1st October, 2017. The Company is in compliance with the same.

Significant or Material Orders

During the year under review, there were no significant and material orders passed by the regulators or court or tribunals, which may impact the going concern status and its operations in future.

Material changes and commitments

There have been no material changes and commitments affecting the financial position of the Company, which have occurred between the end of the financial year and the date of this Report.

Prevention of Sexual Harassment of women at workplace

The Company has formulated a policy in respect of Sexual Harassment of women at workplace as per the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. There was no complaint received by the Company during the financial year 2017-18 under the aforesaid Act.

Risk Management

Your Company recognizes that risk is an integral part of business and is committed to managing the risks in proactive and efficient manner. Your Company periodically assesses the risks in the internal and external environment along with treating the risks and incorporates risk management plans in its strategy, business and operational plans.

The Audit Committee and the Board are appraised of the significant risks and mitigations efforts made by the Management in its quarterly meetings.

The business plan for the future are devised and approved by the Board keeping in mind the risk factors which can significantly impact the performance of the particular business. All major capital expenditures commitments are subject to scrutiny by the Board and investments are permitted only on being satisfied about its returns or utility to the Company. There are no risks which in the opinion of the Board threaten the existence of the Company.

Insurance

The Company has taken all the necessary steps to insure its properties and insurable interests, as deemed appropriate and also as required under the various legislative enactments.

Particulars of Employees and Related Disclosures

The details of remuneration of directors, KMPs and employees as required under Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report as Annexure I. However, as per the provisions of Section 136(1) of the Companies Act, 2013, the Annual Report is being sent to the Members and others entitled thereto, excluding the information on employees remuneration particulars as required under Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Members may write to the Company in this regard.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

Particulars in respect of conservation of energy, technology absorption, foreign exchange earnings and outgo, as required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are set out in a separate statement Annexure A attached hereto and forms part of the Report.

Nomination and Remuneration Policy

The Board has adopted, on recommendation of the Nomination and Remuneration Committee, a policy for selection and appointment of Directors, Senior Management and their remuneration.

The Policy, inter-alia, includes criteria for determining qualifications, positive attributes, independence of a director, and expertise and experience required for appointment of Directors, KMP and Senior Management.

As per the Policy, the remuneration / compensation to the Whole-time Directors shall be recommended by the Nomination and Remuneration Committee to the Board for its approval. However, the remuneration compensation to Whole-time Directors shall be subject to the approval of the shareholders of the Company and Central Government, wherever required. Further, the Non-Executive Directors shall be entitled to the fees for attending meetings of Board and Committees within the limits prescribed in the Companies Act, 2013.

Particulars of the Company’s Remuneration Policy and information required under Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rule, 2014 as set out in Annexure D, forms part of this Report. A brief detail of the Policy is also given in the Corporate Governance Report.

Fixed Deposits

During the year under review, your Company has not accepted or renewed any Deposit, within the meaning of Section 73 of the Companies Act, 2013, read with the Companies (Acceptance of Deposits) Rules, 2014 and as such, there are no outstanding deposits in terms of the Companies (Acceptance of Deposits) Rules, 2014. Hence, the requirement of furnishing details of deposits which are not in compliance of Chapter V of the Act, is not applicable.

Annual Return

An extract of Annual Return pursuant to the provisions of Section 192 of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in form MGT-9 in Annexure G of this Report.

Loans, Investments and Guarantees by the Company

Details of Loans, Guarantees and Investments covered under the provision of Section 186 of the Companies Act, 2013 are given in the Notes to the Financial Statement.

Green Initiative

Electronic copy of the Annual Report 2017-18 and the Notice of the 39th Annual General Meeting are sent to all members whose email addresses are registered with the Company / depository participant(s). For members who have not registered their email addresses, physical copies are sent in the permitted mode.

Your Directors would like to draw your attention to Section 20 of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, as may be amended from time to time which permits paperless compliances and also service of notice / documents (including annual report) through electronic mode to its members. To support this green initiative, we hereby once again appeal to all those members who have not registered their e-mail addresses so far are requested to register their e-mail address in respect of electronic holding with their concerned Depository Participants and/ or with the Company.

Business Responsibility Report

The Business Responsibility Reporting as required by Regulation 34(2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is not applicable to your Company for the financial year ended 31st March, 2018.

Appreciation

Your Directors wish to acknowledge the co-operation and assistance extended to the Company by the Company’s Bankers and State & Central Government agencies. Your Directors also wish to place on record their appreciation of the contribution made by employees at all levels.

Your Directors also acknowledge with gratitude the support of the shareholders, other investors, customers, dealers, agents and suppliers for their continued faith and support which has helped the Company to sustain its growth even during these challenging times.

For and on behalf of the Board of Directors

Praful A. Shah

Chairman & Managing Director

Mumbai, 30th May, 2018 DIN: 00218143

Director’s Report