Gokak Textiles Ltd Management Discussions.

Dear Members,

The Board of Directors (hereinafter referred to as "the Board") hereby submits the report of the business and operations of the Company along with the Audited Financial Statements of the Company for the Financial Year (FY) ended March 31, 2019. The consolidated performance of the Company and its subsidiary has been referred to wherever required.

Financial Results and Highlights of Performance

The Companys performance, as per Indian Accounting Standards (IND AS), during the Financial Year under review is summarised as follows:

(Rs. In Lakhs)

Particulars Standalone Consolidated
FY 18-19 FY 17-18 FY 18-19 FY 17-18
Revenue from Operations and Other Income (Total Revenues) 18,001.66 17,601.96 18,685.16 18,080.35
Earnings before Interest, Depreciation, & Taxation (EBIDT) (1,602.54) (1,618.98) (320.05) (715.43)
Profit / (Loss) after Interest and before Depreciation and Tax (3,009.50) (2,970.65) (2,5690.75) (2,994.08)
Depreciation 621.55 650.80 725.46 754.42
Profit before tax (PBT) (3,631.05) (3,621.45) (3,295.20) (3,748.50)
Profit after tax (PAT) - Owners of the Company (3,631.05) (3,719.70) (3,055.63) (3,793.84)
Profit after tax (PAT) - Non controlling interest - - (239.57) (887.71)
Other Comprehensive Income 62.43 (5.74) 66.34 (4.92)
Total comprehensive income attributable to owners of the Company (3,568.62) (3,725.44) (2,991.20) (3,798.76)
Total comprehensive income attributable - Non controlling interest - - (237.66) (887.71)

Note : The above figures are extracted from Standalone and Consolidated Financial Statements as per Indian Accounting Standard ("IND AS") and are prepared in accordance with the principles stated therein as prescribed by the Ministry of Corporate Affairs under section 133 of the Companies Act, 2013 ("Act") read with relevant rules issued therein.

Management Discussion & Analysis of Financial Conditions, Results of Operations and State of Company Affairs

The textile industry in India is largest industry after agriculture and is also highly labour intensive, offering the largest volume of employment. This industry plays a very vital role in the Indian economy. It is one of the largest contributors to the economy accounting for 4% of the GDP.

The industry has two broad segments. First, the unorganized sector which consists of handloom, handicraft and sericulture, generally operated on a small scale and through traditional tools and methods. The second is the organised sector comprising spinning, apparel and garment segments which apply modern machinery and techniques to achieve economies of scale and global-level competition.

There are also major challenges faced by the Indian cotton, mainly related to the need for continuous improvement in ginning, bale identification system and data management, high moisture content, improvement in bale packaging, branding of Indian cotton, high inland cost, problems of admixture making grading and testing difficult with mills compelled to engage expensive bale management to maintain the yarn quality. There are various challenges to the textile industry viz. extensive use of intensive labour, lack of technology, rising costs, lack of availability of quality cotton, etc. Biggest challenge to this industry for export is from neighbouring countries like China, Vietnam, Bangladesh and Pakistan.

The size of Indias textile market in 2016 was around US$ 137 billion, which is expected to touch US$ 300 billion market by 2025.

General Outlook:

India has emerged as the fastest growing major economy in the world and is expected to be one of the top three economic powers of the world over the next 10-15 years, backed by its strong democracy and partnerships. Indias GDP is estimated to be in the range of 7 to 7.5 % over the next few years. As per various research reports, Global growth is expected to remain at around 3 per cent in the years 2019 and 2020.

India is expected to be the third largest consumer economy as its consumption may triple to US$ 4 trillion by 2025, owing to shift in consumer behavior and expenditure pattern, according to a Boston Consulting Group (BCG) report; is estimated to surpass USA to become the second largest economy in terms of purchasing power parity (PPP) by the year 2050.

India presently is going through a very interesting phase in the political and economic scenario. The political stability now established since May 23, 2019 and given the stated intent, we believe that the Government will now strongly focus on economic development starting with Infrastructure development and India manufacturing focus, thereby creating employment and excellent business opportunities.

The year 2018 saw modest single digit growth in overall apparel and textile consumption globally. Bangladesh and Vietnam are the 2nd and 3rd largest exports after China respectively. Bangladesh accounts for over 6% of the global apparel exports while Indian exports continue to de-grow. Other than cotton yarn exports, most other categories especially Indian apparel exports are clearly seeing de-growth.

Indian textile industry continues to be dominated by cotton, which accounts for nearly 3/4th of the total fibre consumption in the country. Globally fibre consumption is dominated by manmade fibres having 70 per cent of share in total fibre consumption. Contrary to the global trend, in India natural fibers consumption in around 65 per cent of the total consumption, especially cotton.

Area under Cotton cultivation in India in 2018-19 remained nearly the same as previous season. Cotton production in India is estimated at 330 +/- lakh bales of 170 kg each in 2018-19, down from 360+ lakh bales produced in 2017-18. Reduced production is primarily due to weaker rainfall pattern compared to the previous year. In 2018-19, total supply of cotton including carry forward inventory from previous year and imports in the current year is likely to be 395 lakhs bales vis-a-vis 410 lakhs bales in 2017-18. Reduced supply has led to prices remaining firm in the India compared to other Cotton producing countries. Cotton prices remained volatile throughout the year. Indian Cotton price traded well above the new MSP level, announced by Government of India based on the recommendation by Commission for Agricultural Costs & Prices (CACP).

Mills Division

The Company has main focus for the supply of cotton grey and dyed yarn, hence all efforts were on the production and marketing of these products mix for domestic as well as International market. Compared to previous year export of yarn has improved. During the year there was high rise in cotton prices but sales prices did not increased proportionately. To reduce the impact of price hike of raw material, product mix has been changed based on better contribution. In coming year, Company is planning to introduce new yarn product with linen fiber for value addition.

Last year the Company exported yarn approximately amounting Rs. 23.72 crores to countries like Thailand, Pakistan, Sri Lanka, Portugal, etc.

Knitwear Division

New products developed in previous years have been commercialized successfully. Further production capacity has been increased for direct market sale which has increased overall sales compared to previous yea. Efforts are going on to increase customer base.

Risks and Concerns:

Risk management process includes identification of risks, its underlying dynamics, mitigation mechanism, prioritization of risk, measurement of key indicators and establishing a monitoring system. A Company-wide awareness of risk management policies and practices are being inculcated to minimize the adverse effect of risks on the operating results and the subject of management of risks is being approached in a planned and co-ordinated manner. Elucidation of role clarity, understanding of level of authority and reporting system is expected to help this process significantly.

The Company has identified key risks such as Market risks, Regulatory risks, Human resource risks, Commodity price risks.

Key Risks include fluctuation in raw materials prices, increased global and local competition, sales channel disruption. Retaining the existing talent pool and attracting new talent. Regulatory Risks include changes in taxation regime, government policies with respect to textiles, pollution control, Industrial Relation issues, Karnataka Electricity Board & regulatory compliances.

Details of Subsidiary/Joint Ventures/Associate Companies

Subsidiary Company

Gokak Power & Energy Limited (GPEL)

GPEL is engaged in generation, transmission, distribution, trading of hydro power and other renewal and non-renewal sources of energy. The significant portion of power generation is used for captive consumption of Holding Company.

During the year under review, GPEL has recorded gross income of Rs. 1,536.26 lakhs (previous year Rs. 1353.41 lakhs) and net profit for the year of Rs. 89.27 lakhs (previous year net loss Rs. 1211.29 lakhs). Details of GPEL is set out in the statement in form AOC-I, pursuant to section 129 of the Companies Act, 2013 and is attach herewith as Annexure I to this Report

Financial Performance

The Consolidated Financial Statements of the Company and its subsidiary are prepared in accordance with Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 read with Companies (Indian Accounting Standards) Rules, 2015 as amended from time to time and other relevant provisions of the Companies Act, 2013. The Notes to Consolidated Financial Statements are disclosed and forms part of the Consolidated Financial Statements.

Key Financial performance, Operational Information and Ratio Analysis

Key Ratio / Indicators Standalone Explanation for change of
FY 2018-19 FY 2017-18 25% or more
Debtors Turnover (in days) 17.61 27.24 The decrease in days is mainly due to old dues collected
Inventory Turnover * (times) 50.13 57.47 -
Interest Coverage Ratio (1.58) (1.68) -
Current Ratio 0.14 0.14 -
Debt Equity Ratio 1.82 0.99 Bank Loan repaid
Operating Profit Margin % - 9 % - 9 % -
Net Profit Margin % - 20 % - 21 % -
Return on Net Worth - 2.54 % - 1.95 % Accumulated losses increased
Operating Profit Margin % -0.02% -0.04% -
Net Profit Margin % -0.18% -0.21% -
Return on Net Worth 0.66% 0.74% -

Revenue

During the year, standalone revenue was Rs..18001.66 Lakhs (previous year Rs. 17601.96 Lakhs). There is no major increase/ decrease as compared to previous year. Consolidated revenue was Rs. 18685.16 Lakhs (previous year Rs. 18080.35 Lakhs). There is no major increase/decrease as compared to previous year.

Earnings before Interest, Depreciation, Taxation and Amortization ("EBIDTA")

During the year, standalone EBIDTA (loss) decreased to Rs. (1602.54) Lakhs (previous year Rs. (1618.98) Lakhs). Consolidated EBIDTA (loss) decreased to Rs. (320.05) Lakhs (previous year Rs. (715.43) Lakhs).

Profit Before Tax ("PBT")

During the year, standalone PBT (loss) decreased to Rs. (3631.05) Lakhs (previous year Rs. (3621.45) Lakhs). Consolidated PBT (loss) decreased to Rs. (3295.20) Lakhs (previous year Rs. (3748.50) Lakhs).

Fixed Assets

The standalone year-end Gross Block increased to Rs. 32865.35 Lakhs (previous year Rs. 32853.75 Lakhs) mainly due to addition in plant & machinery, vehicles and office equipment. The consolidated year-end Gross Block increased to Rs. 45663.52 Lakhs (previous year Rs. 45651.30 Lakhs) mainly due to addition in plant & machinery, vehicles and office equipment.

Profit/(Loss)

During the year, standalone loss decreased to Rs.(3568.62) Lakhs (previous year Rs. (3725.44) Lakhs). Consolidated loss decreased to Rs. (3295.20) Lakhs (previous year Rs. (3748.50) Lakhs).

Current Liabilities

The standalone current liabilities decreased to Rs. 10145.17 Lakhs (previous year Rs. 12276.27 Lakhs) primarily due to decrease in "current maturities of long term borrowings". The consolidated current liabilities decreased to Rs. 15277.59 Lakhs (previous year Rs. 16550.11 Lakhs) primarily due to decrease in "current maturities of long term borrowings".

Loan Funds

During the year, standalone loan funds increased to Rs. 6481.73 Lakhs (previous year Rs. 6365.12 Lakhs) primarily on account of increase in long term borrowings from parent company. The consolidated loan funds increased to Rs. 10475.64 Lakhs (previous year Rs. 9634.23 Lakhs) primarily on account of increase in long term borrowings from parent company.

Share Capital and Preference Shares

The Paid up Share Capital of the Company, during the year under review, has been increased from Rs. 14649.93 lakhs to Rs. 18149.93 lakhs pursuant to allotment of 3,50,00,000, Non-cumulative, Non-convertible, Redeemable Preference Shares of Rs. 10 each aggregating to Rs. 35 crores on private placement basis to Shapoorji Pallonji and Company Private Limited, Promoters of the Company.

During the year under review, the Company has not issued any shares with differential voting rights or ‘sweat equity shares and has not granted any stock options.

As at March 31, 2019 none of the Directors of the Company hold shares or convertible securities in the Company.

Dividend and Transfer to Reserves

In view of the losses during the current year, the Board of Directors regrets their inability to declare dividend. No amount was transferred to the reserves during the year.

Material changes and commitments

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

Internal Control Systems and their adequacy:

The Company has an Internal Control systems, which ensures that all transactions are satisfactorily recorded and reported and all assets are protected against loss from an unauthorized use or otherwise. The internal control systems are supplemented by an internal audit system carried out by independent firms of Chartered Accountants and a periodical review by the management. The findings of such Internal Audits are addressed through suitable corrective measures. The Audit Committee of the Board meets at a regular interval and advises on significant issues raised by, both, the Internal Auditors and the Statutory Auditors. The process of internal control, systems, statutory compliance, risk analysis, information technology and its management are woven together to provide a meaningful support to the management of the business.

Batliboi & Purohit, Chartered Accountants, the statutory auditors of the Company have audited the financial statements included in this annual report and have issued report, inter alia, on the internal financial controls over financial reporting as defined under section 143 of the Companies Act, 2013.

Deposits

During the year under review, the Company has not accepted any deposits from Public falling within the meaning of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.

Particulars of loans, guarantees or investments

Particulars of Loans, Guarantees or Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

Directors and Key Managerial Personnel

As per the provisions of Section 152(6) of the Companies Act, 2013, Mr. Vasant N. Sanzgiri is due to retire by rotation at the ensuing Annual General Meeting and being eligible, seeks re-appointment. The Board of Directors recommends his reappointment as Director of the Company.

Ms. Tripti J. Navani was appointed as Non-independent Woman Director of the Company with effect from August 01, 2018. Mr. Kaiwan D. Kalyaniwalla, an Independent Director of the Company on account of his other professional commitments resigned from the Directorship of the Company with effect from the close on business hours of March 31, 2019. The Board places on record its appreciation for the invaluable services rendered by Mr. Kaiwan D. Kalyaniwalla to the Board and the Company during their tenure as Member of the Board / Committees of the Board.

Mr. Nikhil J. Bhatia has been appointed as an Additional and Independent Director of the Company with effect from May 22, 2019. The appointment is for a period of 5 years subject to approval of Shareholders at the ensuing Annual General Meeting. Based on the recommendations of the Nomination and Remuneration Committee and subject to approval of the shareholders at the ensuing Annual General Meeting, the Board of Director approved the re-appointment of Mr. Pradip N. Kapadia and Mr. D G Prasad as Independent Directors for second term of 5 years commencing from December 29, 2019.

Based on the recommendations of the Nomination and Remuneration Committee and subject to approval of the shareholders at the ensuing Annual General Meeting, the Board of Director approved the re-appointment of Mr. Ramesh R. Patil as Chief Executive Officer & Managing Director for a further term of 3 years commencing from July 18, 2019.

Mr. Vikram V. Nagar, ceased to be Chief Financial Officer of the Company w.e.f the close of business hours of February 01, 2019. Mr. Avadhut A. Sarnaik was appointed as Chief Financial Officer of the Company w.e.f February 02, 2019. Key Managerial Personnel of the Company are Mr. Ramesh R Patil, Chief Executive Officer & Managing Director, Mr. Rakesh M. Nanwani, Company Secretary and Mr. Avadhut Sarnaik, Chief Financial Officer.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of Independence as prescribed both under the Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), 2015 and there has been no change in the circumstances which may affect their status as Independent Directors during the year.

During the year under review, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees for attending meetings of Board/ Committee of the Company. Independent Directors are familiarized with their roles, rights and responsibilities in the Company through presentation made to them from time to time. The details of familiarization programmes conducted have been hosted on the website of the Company and can be accessed at www.gokakmills.com

Audit Committee of the Board of Directors

The details pertaining to the composition of the Audit Committee of the Board of Directors are included in the Corporate Governance Report which forms part of this report.

Meetings of the Board

The Board met at least once in each quarter and 5 (five) meetings of Board were held during the year and the maximum time gap between two Board meetings did not exceed the time limit prescribed under the Companies Act, 2013. The details have been provided in the Corporate Governance Report.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and SEBI (LODR), 2015, 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 and Remuneration, Stakeholders Relationship Committees.

The performance of the Board was evaluated by the Board on the basis of the parameters/criteria, such as, degree of fulfillment of key responsibility by the Board, Board Structures and Composition, establishment and delineation of responsibilities to the Committees, effectiveness of Board processes, information and functioning, Board culture and dynamics and quality of relationship between the Board and the Management.

The performance of the committees viz. Audit Committee, Nomination and Remuneration Committee, Corporate Social Responsibility and Stakeholders Relationship Committee was evaluated by the Board on the basis of parameters/criteria such as degree of fulfillment of key responsibilities, adequacy of committee composition, effectiveness of meetings, committee dynamics and, quality of relationship of the committee with the Board and the Management.

The Board and the Nomination and Remuneration Committee reviewed the performance of the individual Directors (without the concerned director being present).

In a separate meeting of Independent Directors, the performance of Non-Independent Directors of the Board as a whole and the performance of the Chairman were evaluated.

Remuneration Policy

The Board has, on the recommendation of the Nomination & Remuneration Committee, framed and adopted a policy for selection and appointment of Director, Senior Management and their remuneration. Remuneration Policy of the Company acts as a guideline for determining, inter alia, qualifications, positive attributes and independence of a Director, matters relating to the remuneration, appointment, removal, and evaluation of the performance of the Directors, Key Managerial Personnel and Senior Managerial personnel.

Nomination & Remuneration Policy is annexed as Annexure II to this Report.

Disclosure as required under section 197(12) of the Companies Act, 2013 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed as Annexure III to this Report.

Auditors and Auditors Report

Statutory Auditors

Pursuant to the provisions of section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, Batliboi & Purohit, Chartered Accountants (ICAI Firm Registration no. 101048W) were appointed as the Statutory years to hold office AuditorsoftheCompanyforatermof 5(five) from the conclusion of the 11th Annual General Meeting of the Company till the conclusion of the 16th Annual General Meeting of the Company.

The Audit Report of the Statutory Auditors forms part of the Annual Report. The Auditors Report does not contain any qualification. Notes to Accounts and Auditors remarks in their report are self-explanatory.

Cost Auditors

As per the requirements of section 148 of the Companies Act, 2013, read with The Companies (Cost Records and Audit) Rules, 2014, the cost accounts of the Company are required to be audited by a Cost Accountant. The Board of Directors of the Company one the recommendation of the Audit Committee, appointed Mr. Mukesh R. Dekhtawala, Cost Accountant as Cost Auditor for the financialyear 2019 2020 on a remuneration of Rs. 2.00 lakhs plus out of pocket expenses. As required under the Companies Act, 2013 necessary resolution seeking Shareholders ratification for the remuneration to Cost Auditor is included in the Notice convening the 13th Annual General Meeting of the Company.

Secretarial Audit

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 KDSH & Associates LLP, Company Secretaries, to conduct Secretarial Audit of the Company. The Report of the Secretarial Auditor is annexed herewith as Annexure IV to this Report.

There was a delay in processing of one of the transmission request, the delay was due to time taken by Registrar & Transfer Agents to reasonably satisfy itself about genuineness before processing transmission.

The Secretarial Audit of Gokak Power & Energy Limited, (Material Subsidiary) for the FY 2018-19 was carried out pursuant to Section 204 of the Companies Act, 2013 and Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015. The Report of the Secretarial Auditor of Gokak Power & Energy Limited does not contain any qualification, reservation or adverse remark or disclaimer.

Corporate Social Responsibility

The provisions of the Companies Act, 2013 relating to Corporate Social Responsibility were not applicable to the Company for the FY 2018-19. The Board of Directors of the Company has, however, voluntarily constituted a Corporate Social Responsibility Committee in compliance with Section 135 of the Act.

The Company is spending on afforestation, schools and hospitals, and continued to support causes of public utility both directly and indirectly in the field of education, medical relief, relief of poverty.

The Company is committed to its stakeholders to conduct business in an economically, socially and environmentally sustainable manner that is transparent and ethical.

Vigil Mechanism / Whistle Blower Policy

The Company has Whistle Blower Policy/Vigil Mechanism to deal with instances of fraud and mismanagement, if any. The policy is also available on the website of the Company.

Extract of Annual Return

The details forming part of the extract of the Annual Return in Form MGT-9, as per the provisions of the Companies Act, 2013 and Rules thereto is annexed herewith as Annexure V and forms part of this Report. The said extract is also available on the website of the Company viz. www.gokakmills.com

Related Party Transactions

All related party transactions that were entered into during the financial year were on arms length basis and were in the ordinary course of business. There were no materially significant related party transactions made by the Company with the Promoter, Directors, Key Managerial Personnel or the designated persons which may have a potential conflict with the interest of Company at large except power purchase from the subsidiary company for captive consumption and sale. All related party transactions are placed before the Audit Committee for approval. Prior omnibus approval of the Audit Committee is obtained for transactions which are of a foreseen and repetitive nature. The transactions entered pursuant to the omnibus approval so granted are placed before the Audit Committee on a quarterly basis.

Form AOC-2 is annexed as Annexure VI to this report, pursuant to section 188 of the Companies Act, 2013. The policy on Related Party Transactions as approved by the Board is uploaded on the Companys website.

Corporate Governance and Management Discussion and Analysis

The guiding principle of the Code of Corporate Governance is ‘harmony i.e balancing the need for transparency with need to protect the interest of the Company, balancing the need for empowerment at all levels with the need for accountability and interaction with all stakeholders including shareholders, employees, lenders and regulatory authorities. A detailed report on Corporate Governance is annexed as a part of this Annual Report and the Management Discussion and Analysis report forms part of this report.

A Certificate on compliance of conditions of Corporate Governance issued by Mr. Kiran B. Desai, Designated Partner, KDSH & Associates LLP, Company Secretaries is annexed to the Report on Corporate Governance.

A certificatefrom a company secretary in practice that none of the directors on the board of the company have been debarred or disqualified from being appointed or continuing as directors of companies by the Board/Ministry of Corporate Affairs or any such statutory authority is annexed to the Report on Corporate Governance.

Significant and Material Orders passed by the Regulators or Courts by the Regulators / Courts which would impact the going concern status Therearenosignificant and Companys operations in future.

Statutory Compliances

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace as per with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. Internal Complaints & Committee (ICC) has been setup to redress complaints received regarding sexual harassment as per Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the ICC includes external member. During FY 2018-19, no complaints on sexual harassment were received.

Directors Responsibility Statement

Pursuant to the provisions of Section 134(3)(c) and 134 (5) of the Companies Act, 2013 and based on the representations received from the operating management, the Directors hereby confirm that : a. in the preparation of the annual accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departures; 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 at the end of the financial year and of the profit or loss of the Company for that period; c. they have taken proper and sufficient care to the best of their knowledge and ability 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 were operating effectively; and f. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Human Resources / Industrial Relations

Developments in Human Resources / Industrial Relations front:

The company has got strong base of human resource and employees continue to serve the company for good number of years in view of opportunity to grow, competence development, facility of good education to children etc. The company believes in hiring fresh talented resource and whenever the need arises for hiring an experienced talent priority is given to successor to grow in the line function. The employees are also given opportunity to learn and grow in the other areas also so as make them versatile.

The company has strong induction program, good appraisal system for reward and recognition, enhancement of skill development opportunity and company has been successful in retaining the human talent for self and organizational development. The employee relations continued to be cordial and Management is able to achieve flexibility in the operations in the challenging hours of business with stiff competition and market volatility.

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

a. The information required pursuant to Section 197 of the Act read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the Report and Accounts are being sent to the Members, excluding the information on employees particulars which is available for inspection by the Members at the Registered Office of the Company during the business hours on working days of the Company. Any member interested in obtaining such particulars may write to the Company Secretary at the Registered Office of the Company.

b. Information relating to the Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo stipulated under Section 134(3)(m) of the Act read with Rule 8 of The Companies (Accounts) Rules, 2014 is annexed herewith as Annexure VII to this report.

Cautionary Statement:

Statements in the Boards Report and Management Discussion & Analysis describing the Companys objectives, estimates, expectations or projections, outlook etc., may be ‘forward looking statements within the meaning of the applicable securities laws and regulations. Actual results may differ materially from those expressed or implied due to factors beyond control.

Important factors that could make a difference to the Companys operations include economic conditions affecting demand/ supply and price conditions in the domestic and overseas markets in which the Company operates, changes in the government regulations, tax laws and other statutes and other factors such as litigation and industrial relations.

Acknowledgements

Your Directors acknowledge and thank all stakeholders of the Company viz. customers, members, employees, dealers, vendors, banks and other business partners for their valuable sustained support and encouragement. Your Directors look forward to receiving similar support and encouragement from all stakeholders in the years ahead.

For and on behalf of the Board of Directors
Place : Mumbai, Ramesh R. Patil Vasant N. Sanzgiri
Date : May 23, 2019 Chief Executive Officer & Managing Director Director
DIN : 07568951 DIN: 01757117
Registered Office
#1, 2nd Floor, 12th Cross,
Ideal Homes, Near Jayanna Circle,
Rajarajeshwari Nagar,
Bengaluru- 560 098