AMD Industries Ltd Directors Report.

Dear Shareholders,

Your Directors are pleased to present the 35th Annual Report together with audited accounts for the financial year ended 31st March 2018.

Financial Results

The financial performance of the Company for the financial year ended

31st March, 2018 is summarized below:

(Rs. in Lakhs)

Particulars

Financial Year 2017-18*

Financial Year 2016-17*

Revenue from Operations (net of excise duty)

15462.76

17600.90

Other Income

361.40

67.42

Total

15824.16

17668.32

Profit from operations before Financial Costs,

1705.55

2305.99

Depreciation, Exceptional Items & Tax Expenses
Financial Costs

898.96

903.65

Profit before Depreciation, Exceptional Item &

806.59

1402.34

Taxation
Depreciation

1021.79

1160.36

Profit before Exceptional Items and Tax

-215.20

241.98

Expenses
Exceptional Items

-

-

Profit before Tax

-215.20

241.98

Less: Tax Expenses

141.10

19.97

Profit/Loss for the year

-74.10

201.95

Other Comprehensive Income

-12.56

-22.10

Net Profit/Loss

-86.66

179.85

Appropriations:
General Reserve

Nil

Nil

Dividend on Equity Shares

Nil

Nil

Tax on Dividend

Nil

Nil

Balance Carried to Balance Sheet

-107.77

23.42

TOTAL

-86.66

179.85

*The above figures are extracted from the standalone financial statements prepared as per

Indian Accounting Standards (Ind AS). For the purposes of transition to Ind AS, the Company has followed the guidance prescribed in Ind AS. First-Time Adoption of Indian Accounting Standards, with April 1, 2016 as the transition date and IGAAP as the previous GAAP.

Indian Accounting Standard

The Ministry of Corporate Affairs (MCA), vide its notification in the Official Gazette dated February 16, 2015, notified the Indian Accounting Standards (Ind

AS) applicable to certain classes of companies and the listed Companies. Ind AS has replaced the existing Indian GAAP prescribed under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014. For AMD Industires Limited, Ind AS is applicable from April 1, 2017, with a transition date of April 1, 2016 and IGAAP as the previous GAAP

Operations

During the year under review your Company registered total revenue of Rs. 15462.76 lakhs as compared to previous years revenue of Rs. 17600.90 lakh which shows a de-growth of approx. 12.14% over the previous year. But this difference includes the impact of Exicse duty and collection of real estate revenue. The total Operational revenue (Sale of Product) for the year 2017-18 was of Rs. 12303.84 Lakhs as compared to the year 2016-17 of Rs. 13471.85 Lakhs and there is a degrowth of Rs.1168 Lakhs approx. 8.7% less from last year. There is a Net Loss of 86.66 Lakhs as compared to Net Profit of Rs. 179.85 Lakhs (The profit reported for the previous year 2016-17 was 23.42 Lakhs, the difference of Rs. 156.43 Lakhs is due to implementation of Indian Accounting Standard)

Packaging business

During the year under review, there is a decrease in profit before tax and exceptional items against last year which is mainly due to decrease in overall sales. Over all, sales (including Job work) in PET Performs were down by approx. 8 % against last year. The sales of crowns improved by 14% but Closures down by 23 % than last year. The new product PET Jar was launched in in the month of August 2017 which marked the sale of Rs. 4.43 Crores till the end of the reporting financial year 2017- 2018. So the overall sales of product including Job work decreased by approx 11%.

Real Estate Business

The company through its related company, AMD Estates & Developers Private Limited is developing a Commercial Complex at Sector-114, Gurgaon, Haryana in collaboration with VSR Infratech Private Limited, New Delhi. Since growth in the real estate market of the country has been stagnant, the development of this project has slowed down considerably. During the year under review, the company has received revenue of Rs. 71.16 Lakhs from this project.

Expansion

The company is exploring opportunities to expand its business in other geographies of the country.

Dividend

Your directors recommends no divided for this financial year 2017-18 due to decrease in profit as shown herein above in financial results of the Company.

Fixed deposits

During the financial year 2017-18, your Company has not invited or accepted any deposits from the public within the meaning of provisions of Section 73 of the Companies Act, 2013.

Board, Directors and Key Managerial Personnel

Your Companys Board has an optimum combination of Executive, Non-executive and Independent Directors with one women Director, as per the requirements of Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘SEBI Listing Regulations). The composition of the Board and the Independent Directors of the Company meet all the criteria mandated by SEBI Listing Regulations, 2015 and the Companies Act, 2013. In accordance with the provisions of the Act and the Articles of Association of the Company, Mr. Ashok Gupta, Chairman cum Whole Time Director of the Company, will retire by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment. The Company has received necessary declarations from each of the Independent Directors under section 149(7) of the Companies Act, 2013 that he/she meets the criteria of the independence as laid down in section 149(6) of the Companies Act, 2013 and Clause 49 and Regulation 16(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The details of programs for familiarization of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company at the link: http:// amdindustries.com/Familiarisation%20Programme%20for%20Independent%20 Directors.pdf.

Policy on directors appointment and remuneration

The Board has constituted a Nomination & Remuneration Committee for formulating the criteria for determining qualifications, positive attributes and independence of a director, identify persons who are qualified to become

Director and persons who may be appointed in Key Managerial and Senior Management positions in accordance with the criteria laid down in Nomination & Remuneration policy and to recommend to the Board, appointment and removal of Director, KMP and Senior Management Personnel. The objective of the Nomination & Remuneration Policy is also to set out the principles governing the Companys Remuneration systems in organizational guidelines.

Board Evaluation

The Company has adopted a Performance Evaluation Policy for evaluation of performance of Independent Directors, Board, Committees and other individual Directors (non-executive directors and executive directors). On the basis of this Policy a process of evaluation is being followed by the Board for evaluation of its own performance and that of its Committees and individual Directors.

The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of a questionnaire on board governance and performance issues. Individual directors met with the Chairman of the Company to discuss their responses.

The performance of the committees was evaluated by the Board after getting an evaluation report from the members of each committee which evaluates the performance of the Committee against its stated objectives and responsibilities, effectiveness of committee meetings, etc. during the year. The Board reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, committed to the Companys values, beliefs and ethics etc. In addition, the Chairman was also evaluated on the key aspects of his role.

Directors Responsibility Statement

Pursuant to 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 March 31, 2018, the applicable accounting standards have been followed and there are no material departures from the same;

b) the directors 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 March 31, 2018 and of the profit of the Company for the year ended on that date;

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

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

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

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

Auditors and Auditors Report Statutory Auditors

Pursuant to the provision of section 139 of Companies Act, 2013, M/s Goyal Nagpal & Co. Chartered Accountants (FRN-018289C) was appointed as a

Statutory Auditors of the Company, for a period of five years, by the Shareholders in its Annual General Meeting held on 28.09.2017, subject to ratification in every

Annual General Meeting.

Vide Companies (Amendment) Act, 2017 and enforcement of relevant provisions on 07th May, 2018 by Ministry of Corporate Affairs, the provision with regard to ratification of appointment of Statutory Auditor has been abolished.

The financial statements, as referred to in the Auditors Report, are self explanatory and therefore do not require further comments and explanations.

The Auditors Report does not contain any qualification, reservation or adverse remark.

Cost Auditors

Referring notification of Ministry of

31st December 2014 with respect to applicability of Companies (Cost Records and Audit) Amendment Rules, 2014, your company is not required to get its cost records audited and thus did not proceed towards conducting Audit of Cost Audit for the financial year 2017-18.

Secretarial Auditor

M/s AGG & Associates, Company Secretaries, New Delhi was appointed to conduct Secretarial Audit for the financial year 2017-18, as required under section 204 of the Companies Act, 2013 and rules there under. The Secretarial Audit Report issued by M/s AGG & Associates is forms part of the Annual Report as Annexure-I. It does not contain any qualification, reservation or adverse remark.

Associate/ Joint Venture/ Subsidiary Companies

The company has no associate/ joint venture and subsidiary companies during the financial year under review.

The policy for determining material subsidiaries as approved by the Board may be accessed on the Companys website at the link: http://amdindustries.com/ Policy%20on%20Material%20Subsidiary.pdf.

Corporate Governance

Corporate Governance is about maximizing shareholder value legally, ethically and sustainably. At AMD, the goal of corporate governance is to ensure fairness for every stakeholder. We believe sound corporate governance is critical to enhance and retain investor trust. We always seeks to ensure that our performance is driven by integrity. Our Board exercises its fiduciary responsibilities in the widest sense of term. We also endeavor to enhance long- term shareholder value and respect minority rights in all our business decisions.

Our Corporate governance report for fiscal 2018 forms part of this Annual Report.

Corporate Social Responsibility (CSR)

The Corporate Social Responsibility Committee (CSR Committee) has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, which has been approved by the Board. The CSR Policy may be accessed on the Companys website at the link: http://amdindustries.com/Corporate%20 Social%20Responibility%20Policy.pdf During the year, in compliance with CSR provisions, Company has spent Rs. 7.55 Lakhs on CSR activities. The brief content of CSR policy is given in the Annual Report on CSR activities is annexed herewith as Annexure II.

Further, pursuant to the provisions of rule 3 sub rule (2) of the Companies (Corporate Social Responsibility Policy) Rules, 2014 the provisions of section

135 in relation to spend 2% of the profit on CSR is no more applicable from 2018-19 onwards, as the profit of the company for last 3 years are below 5%, till the Company comes under the purview of Section 135 of the Companies Act, 2013. However Company may continue the same voluntarily being a socially responsible Cororate.

Internal Financial Controls

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed.

Meetings of the Board

The Board met four times during the financial year 2017-18, the details of which are given in the Corporate Governance Report. The maximum interval between any two meetings did not exceed 120 days, as prescribed in the Companies Act, 2013.

Committees

Currently, the Board has five Committees: the Audit Committee, the CSR

Committee, the Nomination and Remuneration Committee, the Management

Committee, the Stakeholder Relationship Committee. A detailed note on the composition of the Board and its Committees is provided in the Corporate Governance Report section of this Annual Report.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient are provided in the financial statements.

Contracts and Arrangements with Related Parties

All contracts / arrangements / transactions entered by the Company during the financial year under review with related parties were in the ordinary course of business and at arms length basis. During the year, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.

The Company has a Policy on materiality of and dealing with Related Party Transactions, as approved by the Board, which is available at its: http:// amdindustries.com/Policy%20on%20Related%20Party%20Transactions.pdf

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act, are provided in Annexure III to this Report.

Vigil Mechanism/Whistle Blower policy

The Vigil Mechanism/Whistle Blower Policy of the Company aims to provide an avenue for directors and employees to raise concerns of any violations of legal or regulatory requirements, incorrect or misrepresentation of any financial statements and reports, unethical behavior, violation of Code of Conduct, etc. This policy also aims to create an environment where individuals feel free and secure to raise the alarm where they see a problem. It also ensures that whistleblowers are protected from retribution, whether within or outside the organization.

The Policy on vigil mechanism/whistle blower policy may be accessed on the Companys website at: http://amdindustries.com/Whistle%20Blower%20 Policy%20-%20Vigil%20Mechanism.pdf

Particulars of Employees and related disclosures

Particulars of Employees and related disclosures in terms of the provisions of Section 197(12) of the Act read with Rules 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are annexed herewith as Annexure IV to this Report.

Risk Management

Risk is an integral and unavoidable component of business and your company is committed to managing the risk in a proactive and effective manner. In todays challenging and competitive environment, strategies for mitigating inherent risks in accomplishing the growth plans of the Company are imperative. The common risks inter alia are: Regulations, competition, Business risk, Technology obsolescence, Investments, retention of talent and expansion of facilities.

Business risk, inter-alia, further includes financial risk, political risk, legal risk.

Your Company adopts systematic approach to mitigate risks associated with accomplishment of objectives, operations, revenues and regulations. During the year, your company has adopted a Risk Management Policy. Our risk management policy focuses on three key elements, 1) Risk Assessment; (2) Risk Management; and (3) Risk Monitoring. Risk Assessment consists of a detailed study of threats and vulnerability and resultant exposure to various risks. Risk Management and Risk Monitoring are important in recognizing and controlling risks. Risk mitigation is an exercise aiming to reduce the loss or injury arising out of various risk exposures.

The Audit Committee of the Company reviews the Risk Management Policy and its implementation.

Extract of Annual Return

Extract of Annual Return of the Company is annexed herewith as Annexure V to this Report.

Disclosures

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

1. Issue of equity shares with differential rights as to dividend, voting or otherwise.

2. Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

3. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its related company.

4. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companys operations in future.

Sexual Harassment Policy

All the Companys units maintain 100% compliance with local and national laws, regarding ethics and human rights. AMD has formed Internal Complaints Committees at all of its operational locations where employees can register their complaints against sexual harassment. This is supported by the Anti-Sexual Harassment Policy which ensures a free and fair enquiry process with clear timelines for resolution. All employees are sensitised on these topics through structured training programme cases of child labour, forced labour, involuntary labour, sexual harassment and discriminatory employment were reported during the period.

Green Initiative

As in the previous years, this year too, Notice of 35th Annual General Meeting of the Company and Annual Report of the Company for the financial year 2017-

18 are sent to all members whose e-mail addresses are registered with the Company/Depository Participant(s). For members who have not registered their e- mail addresses, physical copies are sent in the permitted mode.

Acknowledgement

Your Directors take this opportunity to express their sincere appreciation of the cooperation and support of our customers, business associates and bankers for their continued support during the financial year.

Your Directors wish to convey our deep appreciation to the dealers of the Company for their achievements in the area of sales and service, and to suppliers/ vendors for their valuable support.

Your Directors also place on record our sincere appreciation for the enthusiasm and commitment of Companys employees for the growth of the Company and look forward to their continued involvement and support.

On behalf of the Board of Directors

Ashok Gupta Chairman (DIN- 00031630)

Place: New Delhi Date: 25.05.2018