Jakharia Fabric Ltd Directors Report.

Dear Members,

Your Directors have pleasure in presenting the 13th Annual Report together with the Audited Financial Statements of accounts of the Company for the Financial Year ended 31st March, 2020.

COMPANIES SPECIFIC INFORMATION:

1. FINANCIAL RESULTS :

The Companys financial performance for the year ended 31st March, 2020 is summarized below:

(Rs. In lakhs)

Particulars 2019-2020 2018-2019
Revenue from Operation 8589.21 6997.31
Other Income 34.96 22.49
Total Income 8624.17 7019.80
Expenses:
Cost of Material consumed 4587.83 3273.78
Change in Inventory (57.80) (3.81)
Employee Benefit 1325.78 1313.48
Finance Cost 99.78 109.57
Depreciation & Amortization Exp. 180.01 168.79
Other Expenses (including prior period expenses) 2062.45 1651.41
Total Expenses 8198.06 6513.22
Net Profit/ (Loss) Before Tax 426.81 506.58
Tax Expenses
- Current Tax 140.50 140.47
- Excess/(short) Provision in earlier year 5.54 -
- Deferred Tax (25.35) 20.46
Net Profit/(Loss) After Tax 305.42 345.65
Opening Balance of Profit & Loss A/c 1866.20 1520.54
Add: Profit/ (Loss) for the year 305.42 345.65
Transfers:
- General Reserves
Closing Balance of Profit & Loss A/c 2171.62 1866.20
Earnings per share
- Basic 7.52 9.16
- Diluted 7.52 9.16

2. OPERATIONAL PERFORMANCE :

Your Directors inform the members that the financial year 2019-2020 was an exceptional year and your company faced unprecedented challenges due to COVID -19 at the end of last quarter of the year, which has impacted the revenue and profitability of the company very adversely.

Though the revenue has gone up significantly from Rs 7019.80 Lakhs to Rs 8624.17 Lakhs, an increase of 22.85%, however the margins remained under pressures during the year under review. The Profit Before Tax of the Company has gone down from Rs 506.58 Lakhs to Rs 426.11 Lakhs with higher provision of depreciation from Rs 168.79 lakhs to Rs 180.01 Lakhs. Profit after tax has also gone down from Rs 345.65 Lakhs to Rs 305.42 Lakhs compared to previous year.

The Company is operating only in one segment i.e. processing of textile and there is no change in the nature of the Business of the Company.

In accordance with section 136 of the Companies Act, 2013, the audited financial statements are available on www.jakhariafabric.com. These documents will also be available for inspection during working hours at the registered office of your Company. Any member interested in obtaining such document may write to the Company Secretary and the same shall be furnished on request.

3. IMPACT OF COVID-19 PANDEMIC

The outbreak of COVID-19 had significant impact on the operation of the company. The nationwide lockdown ordered by the Government of India has resulted in significant reduction in business operation of the company. The manufacturing plants & offices of the company were completely shut down from March, 2020 to mid-September, 2020. The operations have partially started from September, 2020 and gradually increasing the capacity utilization levels. Manufacturing & business activities across the world and in domestic market has been affected adversely, planned dispatches held-up.

The demand from domestic markets has not yet revived due to extended lockdown and spread of COVID-19 pandemic affecting retail sale & supply chain. Due to disruption of recession activities throughout the world and lack of consumer demand in International and domestic markets, will affect demand for companys production, revenues and profitability in FY 2020-21, the exact impact of which cannot be ascertained presently. However, it is expected that there will be no significant impact on the business operations of the Company on long term basis and there may be good demand of our products once situation across the world market normalize.

4. UPDATE ON EXPANSION PLAN

The company has made investment in M/s Jakharia Industries (Partnership firm) in which your company is a partner. The production of the said project has commenced since then. The firm has achieved cash profit in the first year of commercial operations.

5. TRANSFER TO RESERVES IN TERMS OF SECTION 134 (3) (J) OF THE COMPANIES ACT, 2013

During the year under review the company has not transferred any amount to the general reserves. The Profit of Rs 305.41 Lakhs is transferred to the Reserve and Surplus Account for the year under review.

6. DIVIDEND

To strengthen the financial position of the company, no dividend is recommended by the Board for the financial year ended March 31, 2020. (previous year NIL)

7. CAPITAL STRUCTURE

The Capital Structure of the Company as on 31.03.2020 are as follows: The Authorized Share Capital of the Company is Rs. 5,00,00,000 (Rupees Five Crore) divided into 50,00,000 (Fifty Lakh) Equity Shares of Rs. 10/- (Rupees Ten) each.

The Issued, Subscribed & Paid up Capital of the Company is Rs. 4,06,38,300 (Rupees Four Crore Six Lakh Thirty-Eight Thousand Three Hundred only) divided into 40,63,830 (Forty Lakh Sixty- Three Thousand Eight Hundred and Thirty) Equity Shares of Rs. 10/- (Rupees Ten) each.

BUY BACK OF SECURITIES

The Company has not bought back any of its securities during the year under review.

SWEAT EQUITY

The Company has not issued any Sweat Equity Shares during the year under review.

BONUS SHARES

No Bonus Shares were issued during the year under review.

EMPLOYEES STOCK OPTION PLAN

The Company has not provided any Stock Option Scheme to the employees.

8. MATERIAL CHANGES BETWEEN THE DATE OF THE BOARD REPORT AND END OF FINANCIAL YEAR:

There have been no material changes and commitments, if any, 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.

9. CHANGE IN NATURE OF BUSINESS :

There has been no change in the nature of any business of the company during the financial year under review.

10. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE:

During the year under review there has been no such 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 significant and material orders passed by any regulator or court or tribunal impacting the going concern status and Companys Operation in future.

11. SUBSIDIARIES, ASSOCIATE COMPANIES& JOINT VENTURES:

The details of Subsidiaries, Associate companies & Joint Ventures are provided in Form MGT - 9 annexure to the Directors Report as "Annexure-I". Form AOC - 1 w.r.t. Associate is attached as "Annexure - VII"

12. EXTRACT OF ANNUAL RETURN

The extract of the Annual Return in Form MGT- 9 as required under section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration Rules), 2014 is enclosed as "Annexure-I"

Kindly Take Note that the Annual Return is available on the Website of the Company on www.jakhariafabric.com.

13. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS 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 II".

14. BOARD OF DIRECTORS, THEIR MEETINGS & KMP(S):

I. Constitution of the Board

The Board of directors are comprising of total 8 (Eight) Directors, which includes 3 (Three) Independent and 1 (One) Women director. The Chairman of the Board is Promoter and Executive Director. The Board members are having varied experience in the relevant field of the business activities of the Company, which plays significant roles for the business policy and decision-making process and provide guidance to the executive management to discharge their functions effectively.

II. Board Independence

Our definition of Independence of Directors is derived from Regulation 16 of SEBI (LODR) Regulations, 2015 and Section 149(6) of the Companies Act, 2013. The Company is having following independent directors:

(i) Mr. Anant Rajaram Sawant

(ii) Mr. Mukul Vora

(iii) Mrs. Rajashri Rajesh Kovil.

As per provisions of the Companies Act, 2013, Independent Directors were appointed for a term of 5 (five) consecutive years and shall not be liable to retire by rotation.

III. Declaration by the Independent Directors

All the Independent Directors have given their declaration of Independence stating that they meet the criteria of independence as prescribed under section 149(6) of the Companies Act, 2013. Further that the Board is of the opinion that all the independent directors fulfill the criteria as laid down under the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015 during the year 2019-20.

IV. Directors liable to retire by rotation

In accordance with the provisions of the Companies Act, 2013 and in terms of the Articles of Association of the Company, Mr. Jignesh Shah (DIN: 00256315), Director of the Company is liable to retire by rotation at ensuing Annual General Meeting and being eligible offers himself for re-appointment.

V. Changes in Directors & Key Managerial Personnel

During the year there is no change in Directors as per the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015.

CHANGES IN KEY MANAGERIA PERSONNEL

There are no changes in Key Managerial Personnel during the year under review.

VI. Meetings and Attendance of the Board

The Board meets at regular intervals to discuss and decide on company/business policy and strategy apart from other Board business. The notice of Board meeting is given well in advance to all the Directors. Meetings of the Board are held in Bhiwandi, at the Registered Office. The Agenda of the Board meetings is circulated at least a week prior to the date of the meeting. The Agenda for the Board and Committee meetings includes detailed notes on the items to be discussed at the meeting to enable the Directors to take an informed decision.

The Board met 5 (Five) times in the Financial Year 2019-20. The maximum interval between any two meetings did not exceed 120 days. Attendance of each director in board meeting as follows:

Sr. no. Date of Meeting Board Strength No. of Directors Present
1 27.05.2019 8 8
2 06.09.2019 8 8
3 14.11.2019 8 8
4 02.01.2020 8 8
5 2.03.2020 8 8

VII. Separate Meeting of Independent Directors:

As stipulated by the Code of Independent Directors under the Companies Act, 2013, a separate meeting of the Independent Directors of the Company was held on 2nd March, 2020 to review the performance of Non-Independent Directors (including the Chairman) and the entire Board. The Independent Directors also reviewed the quality, content and timeliness of the flow of information between the Management and the Board and its Committees which is necessary to effectively and reasonably perform and discharge their duties

VIII. Companys Policy on Directors Appointment and Remuneration:

The Policy of the Company on Directors appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matters provided under section 178(3), are uploaded on companys website www.jakhariafabric.com .

IX. Annual Evaluation by the Board:

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 (10) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Nomination and Remuneration Committee has laid down the criteria for evaluation of the performance of individual Directors and the Board as a whole. Based on the criteria the exercise of evaluation was carried out through a structured process covering various aspects of the Board functioning such as composition of the Board and committees, experience & expertise, performance of specific duties & obligations, attendance, contribution at meetings & Strategic perspectives or inputs regarding future growth of company, etc. The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Director. The performance of the Independent Directors was carried out by the entire Board (excluding the Director being evaluated). The Directors expressed their satisfaction with the evaluation process.

15. COMMITTEES OF THE BOARD:

The Company has following committees:

I. Audit Committee

The Company has already constituted an Audit Committee in accordance with Section 177(1) of the Companies Act, 2013 and Regulation 18 of the SEBI (LODR) Regulations, 2015. the details of which have been provided on www.jakhariafabric.com forming part of this Annual Report. There has been no instance where the Board of Directors had not accepted any recommendation of the Audit Committee.

The Audit Committee comprises of the following Directors of the Company:

Sr. No. Name No. of meeting held during the year No. of meeting Attended during the year
1 Mr. Mukul Vora -Independent Director (Chairman of committee) 4 4
2 Mr. Anant Sawant -Independent Director (Member of committee) 4 4
3 Mr. Jignesh Shah - Chairman & Executive Director (Member of committee) 4 4

During the financial year ended 31st March, 2020, 4(Four) Audit Committee Meetings were held on the following dates:

(1) 27.05.2019 (2) 06.09.2019 (3) 14.11.2019 (4) (4) 02.03.2020

II. Nomination and Remuneration Committee:

The Company has already constituted a Nomination and Remuneration Committee in accordance with section 178 of the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015, the details of which have been provided on www.jakhariafabric.com.

The Nomination and Remuneration Committee comprises of the following Directors of the Company.

Sr. No. Name No. of meeting held during the year No. of meeting Attended during the year
1 Mrs. Rajashri Kovil -Independent Director (Chairman of Committee) 4 4
2 Mr. Anant Sawant -Independent Director (Member of Committee) 4 4
3 Mr. Mukul Vora -Independent Director (Member of Committee) 4 4

During the financial year ended 31st March, 2020, 4 (Four) Nomination and Remuneration Committee Meetings were held on the following dates: (1) 27.05.2019 (2) 06.09.2019 (3) 14.11.2019 (4) (4) 02.03.2020

III. Stakeholders Relationship Committee:

The Company has already constituted a Stakeholders Relationship Committee on 27.04.2018 in accordance with section 178 of the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015, the details of which have been provided on www.jakhariafabric.com. The Committee considers and approves various requests regarding annual report and to redress complaints of the shareholders.

The Stakeholders Relationship Committee comprises the following Directors:

Sr. No. Name No. of meeting held during the year No. of meeting Attended during the year
1 Mr. Anant Sawant -Independent Director (Chairman of Committee) 4 4
2 Mrs. Rajashri Kovil -Independent Director (Member of Committee) 4 4
3 Mr. Nitin Shah -Managing Director (Member of Committee) 4 4

During the financial year ended 31st March, 2020, 4 (Four) Stakeholders Relationship

Committee Meetings were held on the following dates:

(1) 27.05.2019 (2) 06.09.2019 (3) 14.11.2019 (4) (4) 02.03.2020

IV. Corporate Social Responsibility (CSR) Committee:

The Company has already constituted a CSR Committee on 27.04.2018 in accordance with the provisions of section 135 of the Companies Act, 2013. The CSR Committee comprises the following Directors:

Sr. No. Name No. of meeting held during the year No. of meeting Attended during the year
1 Mr. Anant Sawant -Independent Director (Chairman of Committee) 2 2
2 Mr. Jignesh Shah -Chairman & Executive Director (Member of Committee) 2 2
3 Mr. Nitin Shah -Managing Director (Member of Committee) 2 2

During the financial year ended 31st March, 2020, 2 (Two) Corporate Social Responsibility Committee Meetings were held on the following dates (1) 27.05.2019 & (2) 02.03.2020

16. CORPORATE SOCIAL RESPONSIBILITY:

In pursuant to Section 135 of the Companies Act, 2013 read with rules framed there under a CSR Policy to ensure Social Responsibilities has been already adopted by the Company. The CSR Policy has been uploaded on the website of the Company.

In view of the profits and turnover of the company, your Company was required to undertake CSR projects during the year 201920.

Company could not spend any amount towards CSR activities since the implementation of some projects will commence in the FY-2020-21 as the company is under formulating implementation plan and taking various approvals required in this regard. Your company has taken steps in the right directions and going forward is committed to actively engage with the partners/NGOs to execute the said events or projects and programs and incur expenditure in accordance with section 135 of Companies Act, 2013.

The Annual Report on CSR activities is annexed herewith as "Annexure III"

17. STATUTORY AUDITOR & AUDIT REPORT :

M/s. SHAH SHROFF & ASSOCIATES, Chartered Accountants, bearing (Firm Registration No. 0128920W) the Companys Statutory Auditors of the Company, hold the office, in accordance with the provisions of the act at this Annual General Meeting and being eligible for Reappointment as required under the provisions of Section 139 of Companies Act, 2013 from the conclusion of this Annual General Meeting till the conclusion of 18th Annual General Meeting of the Company at a remuneration as may be decided by the board.

As required under Regulation 33(d) of the SEBI (LODR) Regulation, 2015, the auditor has confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India. Board is pleased to inform that there is no such observation made by the Auditors in their report which needs any explanation by the Board. The Notes on financial statement referred to in the Standalone & Consolidated Auditors Reports are self-explanatory and do not call for any further comments. The Standalone & Consolidated Auditors Report does not contain any qualification, reservation, adverse remark or disclaimer.

18. SECRETARIAL AUDITOR

The Board of Directors, on the recommendations of the Audit Committee, of the Company, has appointed M/s DHARA U. SHAH & ASSOCIATES, Company Secretaries, Mumbai, [ICSI Membership No. ACS - 46383 & Certificate of Practice No. 16977], as the Secretarial Auditors of the Company for the financial year 2019-2020.

The Secretarial Audit Report in Form No. MR-3 submitted by the said Secretarial Auditors, do not contain any adverse remarks and qualifications, hence do not call for any further explanation/s by the Company. The Secretarial Audit Report in Form No. MR-3 submitted by the said Secretarial Auditors, for the financial year 2019-2020 forms part of the Annual Report as "Annexure IV" to the Boards report.

CERTIFICATION FROM COMPANY SECRETARY IN PRACTICE

M/s. DHARA U. SHAH & ASSOCIATES, Practicing Company Secretaries has issued a certificate required under the Listing Regulations, Board of the Company has been debarred or disqualified from being appointed or continuing as director of the Company by the SEBI/Ministry of Corporate Affairs or any such statutory authority. The Certificate is enclosed with this report As "Annexure-IV"

19. INTERNAL AUDITORS:

Pursuant to Section 138 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 (as amended), the Board of Directors, on the recommendations of the Audit Committee, of the Company is appointed M/s R M F & Co., Chartered Accountants, Mumbai, [ICAI Firm Registration No.-153788W], as the Internal Auditors of the Company in the place of M/s. ABHIJEET H GOLE & ASSOCIATES, Chartered Accountants, Mumbai [ICAI Firm Registration No. - 139716W for the financial year 2020-2021 ended on 31.03.2021. The Internal Audit Finding/s and Report/s submitted by M/s. ABHIJEET H GOLE & ASSOCIATES, during the financial year, to the Audit Committee and Board of Directors of the Company, do not contain any adverse remarks and qualifications hence do not call for any further explanation/s by the Company.

20. COST AUDITORS:

As per the requirement of the Central Government and pursuant to section 148 of the Companies Act, 2013, read with Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, your company hereby confirms that the provisions of this section are not applicable, hence your company need not required to appoint cost auditor for the financial year 2019-20.

21. DISCLOSURE FOR FRAUD AGAINST THE COMPANY:

In terms of provision of section 134(3)(ca) of the Companies Act, 2013, There were no instances of fraud which are reported by Auditors of the Company under section 143(12) of the Companies Act, 2013 to the Audit Committee.

22. CODE OF CONDUCT:

Regulation 17(5) of the SEBI (LODR) Regulations, 2015 requires listed companies to lay down a Code of Conduct for its directors and senior management, incorporating duties of directors as laid down in the Companies Act, 2013.

The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and specified employees in the course of day to day business operations of the Company. The Company believes in "Zero Tolerance" against bribery, corruption and unethical dealings / behavior in any form and the Board has laid down certain directives to counter such acts. The Company has adopted a Code of Conduct for all Directors and Senior Management of the Company and same is hosted on the website of the company i.e. www.jakhariafabric.com

The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders. The Code gives guidance through examples on the expected behavior from an employee in a given situation and the reporting structure. All the Board Members and the Senior Management personnel have confirmed compliance with the Code.

23. CORPORATE GOVERNANCE:

The Company being listed on the EMERGE Platform of National Stock Exchange of India Limited and therefore pursuant to Regulation 15(2)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Regulation 27 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Part C of Schedule V relating to compliance of Corporate Governance shall not be applicable to the Company. Further, The Company is not required to comply with requirements as specified in Part E of Schedule II pursuant to Regulation 27(1) SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and submitting Compliance Report on Corporate Governance on quarterly basis pursuant to Regulation 27(2) SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Hence no Corporate Governance Report is required and therefor it is not forming part of this Annual Report. It is pertinent to mention that the Company follows majority of the provisions of the corporate governance voluntarily as a part of Good Corporate Governance.

24. INDUSTRIAL RELATIONS:

During the year under review your Company enjoyed cordial relationship with workers and employees at all levels.

25. CHANGE IN THE NATURE OF BUSINESS:

During the year under review there is no change in the nature of the business and commercial activities of the company.

26. DEPOSITS:

During the financial year 2019-2020 ended 31 March 2020 under review, the Company has neither invited nor accepted any public deposits within the meaning of Section 73 and 74 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 (as amended). As such, no specific details prescribed in Rule 8(1) of the Companies (Accounts) Rules, 2014 (as amended) are required to be given or provided.

27. VIGIL MECHANISM / WHISTLE BLOWER POLICY:

Your Company is committed to highest standards of ethical, moral and legal business conduct. Accordingly, the Board of Directors have formulated a Whistle Blower Policy which is in compliance with the provisions of Section 177 (9) of the Companies Act, 2013 and the regulation 22 of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, The Company has adopted a Whistle-Blower Policy for Directors and employees to report genuine concerns and to provide for adequate safeguards against victimization of persons who may use such mechanism. The details of the Vigil Mechanism Policy has posted on the website of the Company at www.jakhariafabric.com

28. PREVENTION OF INSIDER TRADING:

In view of the SEBI (Prohibition of Insider Trading) Regulation, 2015 the Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The details of the Insider Trading Policy has posted on the website of the Company at www.jakhariafabric.com

The Code requires Trading Plan, pre-clearance for dealing in the Companys shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. However, there were no such instances in the Company during the year 2019- 20.

29. RISK MANAGEMENT:

A well-defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process is in place. The objective of the mechanism is to minimize the impact of risks identified and taking advance actions to mitigate it. The mechanism works on the principles of probability of occurrence and impact, if triggered. A detailed exercise is being carried out to identify, evaluate, monitor and manage both business and non-business risks.

The Board of Directors of the Company and the Audit Committee shall periodically review and evaluate the risk management system of the Company so that the management controls the risks through properly defined network. Head of Departments shall be responsible for implementation of the risk management system as may be applicable to their respective areas of functioning and report to the Board and Audit Committee.

The Company has not made Risk Management Committee, but the Board of Directors and Audit Committee is looking after the Risk Management of the Company.

30. MEETINGS OF THE MEMBERS:

During the year under review 12th Annual General Meeting of the Company was held on 30.09.2019.

31. DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to the requirement under section 134(3)(C) of the Companies Act, 2013 with respect to Directors Responsibility Statement, it is hereby confirmed that:

(i) in the preparation of the annual accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departures;

(ii) 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 the year ended for that period;

(iii) the directors had 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;

(iv) the directors had prepared the annual accounts on a going concern basis;

(v) the directors 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

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

32. MANAGEMENT DISCUSSION AND ANALYSIS REPORTS:

As per Regulation 34 (e) read with schedule V of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), the management Discussion and Analysis Report of the Company for the year ended is set out in this Annual Report as "Annexure-V

33. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013:

Details of Loans (Secured or unsecured), Guarantee provided in connection with any loan/s availed and Investments pursuant to the section 186 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014 (as amended) are given in the notes to the Financial Statements.

34. INTERNAL CONTROL SYSTEMS:

The Companys internal control systems are adequate and commensurate with the nature and size of the Company and it ensures:

• Timely and accurate financial reporting in accordance with applicable accounting standards.

• Optimum utilization, efficient monitoring, timely maintenance and safety of its assets.

• Compliance with applicable laws, regulations and management policies.

35. INTERNAL FINANCIAL CONTROL FOR FINANCIAL STATEMENTS

Your Company has an effective internal financial control and risk-mitigation system, which are constantly assessed and strengthened with new/revised standard operating procedure. The Companys internal financial control system is commensurate with its size, scale and complexities of its operations.

36. HUMAN RESOURCES:

The Company treats its "Human Resources" as one of its most important assets. Your Company continuously invests in attraction, retention and development of talent on an ongoing basis. The Company thrust is on the promotion of talent internally through job rotation and job enlargement.

37. RATIO OF THE REMUNERATION OF EACH DIRECTOR TO THE MEDIAN EMPLOYEES REMUNERATION AND PARTICULARS OF EMPLOYEES:

Pursuant to provision of section 197 of Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the details of employees given in the "Annexure-VI"

During the year, none of the Directors, KMP and Employees received remuneration in excess, in accordance with the provisions of Section 197 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Therefore, there is no information to disclose in terms of the provisions of the Companies Act, 2013.

38. RELATED PARTY TRANSACTIONS:

All related party transactions that were entered during the financial year, were on the arms length basis and were in the ordinary course of business and do not attract the provisions of section 188 of the Companies Act, 2013. Thus, disclosure in form AOC-2 is not required. All Related Party Transactions were placed before the Audit Committee for approval. A policy on the related party Transitions was framed & approved by the Board and posted on the Companys website at www.jakhariafabric.com

However, you may refer to Related Party transactions, as per the Accounting Standards, in the Notes forming part of financial statements.

39. INVESTORS EDUCATION AND PROTECTION FUND

During the financial year 2019-2020 ended 31 March 2020 under review, there were no amount/s which is required to be transferred to the Investor Education and Protection Fund by the Company. As such, no specific details are required to be given or provided.

40. DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013:

To prevent sexual harassment of women at work place, The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 has been notified on 9th December 2013. The Company has zero tolerance for sexual harassment at workplace in line with provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and rules there under for prevention and redressal of complaints of sexual harassment at workplace. During the year under review, no complaints were received by the Company relating to sexual harassment at workplace. The Management of the Company endeavors to provide safe environment for the female employees of the Company.

41. REGISTRAR AND SHARE TRANSFER AGENT:

The Company has appointed Bigshare Services Private Limited as its Registrar and Share Transfer Agent. The Corporate Office of Bigshare Services Pvt. Ltd. situated at "1st Floor, Bharat Tin Works Building, Opp. Vasant Oasis, Makwana Road, Marol, Andheri East, Mumbai- 400059, Maharashtra.

42. DEMATERIALISATION OF SECURITIES:

The Companys Equity Shares are admitted in the system of Dematerialization by both the Depositories namely NSDL and CDSL. As on 31st March 2020, 38,30,500 equity shares

dematerialised through depositories viz. National Securities Depository Limited and Central Depository Services (India) Limited, which represents whole 94.26 % of the total issued, subscribed and paid-up capital of the Company as on that date. 2,33,330 equity shares are in physical form. The ISIN allotted to your Company is INE00N401018.

43. COMPLIANCES OF SECRETARIAL STANDARDS:

The Board of Directors confirms that the Company, has duly complied and is in compliance, with the applicable Secretarial

Standard/s, namely Secretarial Standard-1 (SS- 1) on Meetings of the Board of Directors and Secretarial Standard -2 (SS-2) on General Meetings, during the financial year 2019-2020 ended 31 March 2020.

44. GREEN INITIATIVE

Companies Act permits paperless compliance and as a measure of green initiative, we appeal to all those members who have not registered their e-mail addresses so far are requested to register their email address in respect of electronic holding with their concerned Depository Participants and/or with the Company.

45. ACKNOWLEDGEMENT:

The Board of Directors wish to express their grateful appreciation for assistance and cooperation received from various Departments of Central & State Governments and Banks during the year under review. Your Directors also wish to place on record their appreciation for the committed services of all the associates and vendors of the Company.

By order of the Board

Sd/-

JIGNESH SHAH

CHAIRMAN & EXECUTIVE DIRECTOR

DIN:00256315

Place: BHIWANDI

Date: 05.12.2020