Ecoboard Industries Ltd Directors Report.

To,

The Members of

Ecoboard Industries Limited

The directors submit annual report of Ecoboard Industries Limited (the "Company") along with the audited financial statements for the financial year (FY) ended on March 31st, 2019. Consolidated performance of the Company has been referred to wherever required.

Directors have tried to maintain coherence in disclosures and flow of the information by clubbing required information topic-wise, and thus certain information which is required in directors report is clubbed elsewhere and has to be read as a part of boards report.

1. FINANCIAL SUMMARY / HIGHLIGHTS

The financial performance of your Company:

(Amounts in Lakhs)

Particulars Current Year Previous Year
2018-19 2017-18
Income:
2,038.20 883.21
Revenue from operations 38.08 18.53
Other Income
2,076.28 901.74
Total Income
Expenditure:
Cost of materials consumed 1,544.11 614.56
Changes in inventories of finished goods, work-in-progress 212.14 161.61
Employee benefits expense 159.35 198.53
Finance costs 498.14 636.27
Depreciation 106.95 122.68
Other expenses 474.88 555.41
2,995.57 2,289.06
Profit / (Loss) before exceptional items and tax (919.29) (1387.32)
Add/(Less): Exceptional items 199.05 0.00
Profit / (Loss) before tax (720.24) (1387.32)
Less: Tax expenses 0.00 0.00
Profit / (Loss) for the period (720.24) (1,387.32)
Other Comprehensive Income
Items that will not be reclassified into profit or loss 0.46 11.29
Other Comprehensive income for the year (net of tax) 0.46 11.29
Total comprehensive income for the year (719.78) (1,376.03)
Earnings / (Loss) per Share (Rs.)
-Basic (4.04) (7.72)
-Diluted (4.04) (7.72)

Financial performance

During the year 2018-19 your company has made turnover of Rs 2,038.20 Lakhs as compared to turnover of the previous financial year of Rs. 883.21 Lakhs, whereas Loss for the year is Rs.719.78 /- Lakhs as against Rs. 1,376.03/- Lakhs in the previous financial year. Boards of Directors are very confident that the business of the Company will continue to grow in upcoming years.

Year

Sales performance

PBT

PAT

EPS

(Rs. Lacs)

(Rs. Lacs)

(Rs. Lacs)

(Rs. Lacs)

2014 2807.82 (810.75) (898.13) (5.04)
2015 1693.28 (673.20) (698.81) (3.92)
2016 2,205.48 (1,468.07) (1,489.82) (8.35)
2017 1633.84 (975.13) (996.21) (5.59)
2018 883.21 (1387.32) (1387.32) (7.72)
2019 2,038.20 (720.24) (720.24) (4.04)

Company faced good tail-winds in "Bio-Energy" engineering division with new projects in distilleries, a traditional market. The turnover of "Bio-Panels" division was marginal, as we couldnt procure raw material due to shortage of working capital. The Bio-panels division of the Company continues to upgrade the existing machineries. The implementation of GST of 12 % has reduced the Ecoboard price deferential with its unorganized players and increased market share of Ecoboard and company is having a positive effect.

Based on internal financial control framework and compliance systems established in the Company, the work performed by statutory, internal and secretarial auditors and reviews performed by the management and/or relevant Audit and other Committees of the Board, your Board is of the opinion that the Companys internal financial controls were adequate and effective during the financial year 2018-19.

2. DIVIDEND

In view of paucity of funds in the current year and due to counting losses the, the Board of Directors does not recommend any dividend for the F.Y. 2018-19.

The unclaimed dividend pertaining for the year ended March, 2009 transferred to the Investor Education & Protection Fund.

3. DIRECTORS AND KMP:

The details of Appointment, re-appointment and retiring by rotation of Directors and Key Managerial Personnel (KMP) are included in Corporate Governance Report, and forms part of the boards report as "Annexure B".

4. SEGMENT WISE AND PRODUCT-WISE OPERATIONAL PERFORMANCE:

The details are given under Notes to Accounts of financial statements.

5. Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Companys operations in future.

There are no such orders except those which have been appropriately challenged before the judiciary and no impact on going concern status and Companys operation in future of such matters are expected or visualized at the current stage at which they are.

6. Details in respect of adequacy of internal financial controls with reference to the Financial Statements.

Your Company has an internal Control System which commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function lies with the Audit Committee of Directors. The Audit Committee monitors and evaluates the efficacy and adequacy of internal control systems, accounting procedures and policies. The Company has not appointed Internal Auditors yet.

7. DETAILS OF HOLDING/SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES :

The Company has no subsidiary/joint venture/associate company and hence consolidation and applicable provision under the Companies Act, 2013 and Rules made there under are not applicable to the Company.

8. Board Evaluation

Pursuant to applicable provisions of the Companies Act, 2013 and the Listing Regulations, the Board carried out an annual performance evaluation of the Board, its Committees, Individual Director and Chairperson. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

9. DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM FOR DIRECTORS AND EMPLOYEES

The Company has a Vigil Mechanism Policy in place to deal with instances, if any, of the fraud, mismanagement, misappropriations, if any and the same is placed on the Companys website.

10. MANAGERIAL REMUNERATION:

Details as required pursuant to Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are contained in Corporate Governance Report.

11.NUMBER OF PERMANENT EMPLOYEES

During the period under review, there are 54 permanent employees of the Company.

12.DIRECTORS RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3) (c) of the Companies Act, 2013: a. that in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; b. the directors had 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 at the end of the financial year and of the profit and loss of the company for that period; c. the directors had taken proper and sufficient care has been taken 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. that the annual accounts have been prepared on a going concern basis; e. the directors had laid down proper internal financial controls which were in place and that the financial controls were adequate and were operating effectively. f. that the directors have devised proper systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

13.MEETINGS OF THE BOARD OF DIRECTORS

During the Financial Year 2018-19, the Company held 7 (Seven) board meetings of the Board of Directors as per Section 173 of Companies Act, 2013 which is summarized below. The provisions of Companies Act, 2013 and Listing Regulations were adhered to while considering the time gap between two meetings.

Name of Director Category

Attendance during 2018-19 of meeting

*No. of other Directorship
Board Last AGM
#Mr. V.S. Raju Chairman 2 Yes 1
Mr. Ramakrishna Raju Gottumukkala Managing Director 5 Yes 1
Mr. Praveen Kumar Raju Gottumukkala Executive Director 6 Yes 0
Mr. Uttam Sampatrao Kadam Non-Executive & Independent 7 Yes 11
#Mr. Satya Narayan Banka Non-Executive & Independent 0 No 0
Mrs. Venkata Sujani Indukuri Executive Director 5 Yes 0
Mr. Siva Sankar Kalive Non-Executive & Independent 7 Yes 0
Mr. P. V. V. Rama Raju Non-Executive & Independent 1 No 0

# Mr. V.S. Raju Ceased to be Director w.e.f. 10.11.2018

# Mr. Satya Narayan Banka ceased to be Director w.e.f. 30.10.2018

14.PARTICULARS OF LOANS, ADVANCES, GUARANTEES AND INVESTMENTS

Pursuant to section 186 of Companies Act, 2013 and Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), disclosure on particulars relating to Loans, advances, guarantees and investments are provided as part of the financial statements.

18. LISTING REGULATIONS COMPLIANCE

Your Companys Equity Shares are listed on BSE Ltd. and their listing fees for the Financial Years 2018-19 and 2019-20 is pending and the provisions of the Listing Obligation and Disclosures Requirement, Regulations, 2015 have been complied with.

15.DEPOSITS

Your Company has not accepted any deposits from public and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.

16.RISK MANAGEMENT

Periodic assessments to identify the risk areas are carried out and management is briefed on the risks in advance to enable the company to control risk through a properly defined plan. The risks are classified as financial risks, operational risks and market risks. The risks are taken into account while preparing the annual business plan for the year. The Board is also periodically informed of the business risks and the actions taken to manage them. The Company has formulated a policy for Risk management with the following objectives:

Provide an overview of the principles of risk management

Explain approach adopted by the Company for risk management

Define the organizational structure for effective risk management

Develop a "risk" culture that encourages all employees to identify risks and associated opportunities and to respond to them with effective actions.

17.ANNUAL REVALUATION

Pursuant to the provisions of the Companies Act, 2013, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and Compliance Committees. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Boards functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance. A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors who also reviewed the performance of the Secretarial Department.

18.INDEPENDENT DIRECTORS AND DECLARATION

Composition of the independent director is in compliance with the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

19.CODE OF CONDUCT

i. Code of Conduct for Director and Senior Management of the Company: The Company has adopted the

Code of Conduct for the Directors and Senior Management of the Company. All Board Members and Senior Management Personnel have affirmed compliance with the code as on March, 2015.

ii. Code of Conduct for prevention of Insider Trading: The Company has its own Code of Conduct for

Prevention of Insider Trading which has now been amended according to the SEBI (Prohibition of Insider Trading) Regulations, 2015.

20.CORPORATE GOVERNANCE:

As the listed Company, necessary measures are taken to comply with provisions of the SEBI (Listing Obligation and Disclosure Requirements) Regulation, 2015. The Report on Corporate Governance along with the certificate as stipulated confirming compliance with the conditions of Corporate Governance, the Managing Directors declaration as stipulated under the aforesaid Clause, Regulation and Management Discussion and Analysis Report forms part of Annual Report.

21.CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREX EARNING AND OUTGO:

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134 (3) (m) of the Companies Act, 2013 read with Rule, 8 of The Companies

(Accounts) Rules, 2014, is annexed herewith as "Annexure A".

22.EXTRACT OF ANNUAL RETURN IN FORM MGT-9

The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as

"Annexure B". The link of annual report as per the Companies Amendment Act, 2017 is as below; www.ecoboard.in

23.GENERAL

Your Directors state that no disclosure or reporting is required in respect of the following items since there were no transactions in these matters and/or they are not applicable to the Company during the year under review:

1. Details relating to deposits covered under Chapter V of the Act.

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

3. Issue of shares (including sweat equity shares) to employees of the Company under ESOS.

4. No significant or material orders were passed by the Regulators / Courts or Tribunals which would impact the going concern status of the Company and its future operations. 5. No fraud has been reported by the Auditors to the Audit Committee or the Board.

24.SECRETARIAL STANDARDS

The Directors state that applicable Secretarial Standards on Board Meetings (SS-1) and on General Meetings (SS-2) have been duly followed by the Company.

25. SHARE CAPITAL

The Paid up capital of the company is Rs.5,30,00,000. The Company issued Rs. Nil Equity Shares either with or without differential rights during the F.Y. 2018-2019 and hence, the disclosure requirements under section 43 and Rule 4 (4) of the Companies (Share Capital and Debentures) Rules, 2014, is not applicable.

26.COMPENSATION AND DISCLOSURE ANALYSIS:

The Companies Act, listing Regulations through various provisions require disclosure and analysis on executive, directors, KMPs and other employees compensation. The said information forms part of boards report annexed herewith as "Annexure C"

27.RELATED PARTY TRANSACTIONS:

Related party disclosures pursuant to sub-section (1) of section 188 of the Companies Act, 2013 are forming part of the Board report and is annexed herewith as "Annexure D".

28.STATUTORY AUDITORS:

The Companys Auditors, B. M. Chaturvedi & Co., Chartered Accountants, Mumbai, (Firm Regn. No. 114317W). For the period of five consecutive years i.e. 01.04.2017 to 31.03.2022. Section 40 of the Companies Amendment Act, 2017 is notified w.e.f. May 07, 2018. Which means that the first proviso of Section139(1) stands omitted. Therefore, now the ratification of the appointment of the Statutory Auditors at every Annual General Meeting is not required.

29.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 Company has appointed M/s. S. R. Siddheshwar & Co., Pune, a firm of Company Secretaries in Practice, to undertake the Secretarial Audit of the Company. Secretarial Audit Report for the financial year March 31, 2019 is annexed herewith as

"Annexure E" in FORM MR-3.

30.COMMENTS ON OBSERVATIONS ON SECRETARIAL AUDIT REPORT

The observation and qualification is annexed with as "Annexure-E".

31.MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There have been no material changes and commitments, affecting the financial position of the Company which occurred during between the end of the financial year to which the financial statements relate and the date of this report.

32.DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/COURTS/TRIBUNALS

IMPACTING THE GOING CONCERN STATUS AND THE COMPANYS OPERATIONS IN FUTURE

There are no significant material orders passed by the Regulators/ Courts which would impact the going concern status of the Company and its future operations.

33.INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION,

PROHIBITION AND REDRESSAL) ACT, 2014

The Company has constituted an internal complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2014. During the year no complaint was filed before the said Committee.

34.ACKNOWLEDGEMENTS AND APPRECIATION

Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business partners/associates, financial institutions and Central and State Governments for their consistent support and encouragement to the Company. I am sure you will join our Directors in conveying our sincere appreciation to all employees of the Company for their hard work and commitment. Their dedication and competence has ensured that the Company will definitely overcome from such turbulent situation and emerge as significant and leading player in the industry.

FOR AND ON BEHALF OF THE BOARD OF DIRECTORS

Sd/-

Ramakrishna Raju Guttumukkala

Chairman & Managing Director

DIN: 01516984

Place: Pune

Date: 14 /08/2019