Jash Engineering Ltd Directors Report.

To,

The Members of

JASH ENGINEERING LIMITED

Your Directors have pleasure in presenting the 46th Directors Report of your Company together with the Audited Statement of Accounts and the Auditors Report of your company for the financial year ended 31stMarch, 2020.

1. FINANCIAL HIGHLIGHTS

The financial statements of the Company are in accordance with the Indian Accounting Standard - IND AS and as per the provision of Section 133 of the Companies Act, 2013 (the Act) read with Companies (Accounts) Rules, 2014 and amendments thereof. The standalone and consolidated financial highlights of the Company for the financial year ended March 31st, 2020 are summarized below:

Standalone

Consolidated

Particulars 2019-20 2018-19 2019-20 2018-19
Sales and other Income 21433.48 20495.53 28564.13 25468.51
Expenditure other than financial charges and depreciation 17121.74 17152.73 23974.06 22512.62
Gross Profit before Interest, Depreciation & Taxes 4311.74 3342.8 4590.07 2955.89
Less: Interest & Financial Charges 963.76 751.82 1033.50 850.04
Depreciation 517.60 519.91 782.22 724.87
Less: Earlier years adjustments - - - -
Net profit before tax for the year 2830.41 2071.07 2774.35 1380.98
Provisions for tax 648.67 353.29 764.67 6 1 1 . 69
Net Profit after Tax 2181.74 1717.78 2009.68 769.59
Less: Other Comprehensive Income 44.72 8.17 52.89 51.75
Total Co mprehensive Income 2137.02 1709.61 1956.79 717.84
No. of Equity Shares 11836598 11836598 11836598 11836598
Earnings Per Share 18.43 14.51 16.98 6.50

2. STATE OF AFFAIRS OF THE COMPANY:

A. BUSINESS ACTIVITIES OF THE COMPANY

Your company is involved in the business of design and manufacture of a wide range of equipment for Water Intake Systems, Water and Waste Water Pumping Stations and Treatment Plants, Storm Water Pumping Stations, Water Transmission Lines, Power, Steel, Cement, Paper & Pulp, Petrochemicals, Chemical, Fertilizers and other process plants. These equipment are Water control gates, Mechanized screening systems, Screening conveying and washing systems, Knife gate valves, Water hammer control valves, Energy dissipating valves, Archimedes screw pumps, Micro hydro turbines, Clarifiers, Clariflocculators, Flash Mixers, Degriters, Aerators, Thickeners, Gravity Decanters, Trickling Filters, Digester Mixers, DAF Units and solid handling valves.

Your company offers a single stop solution under one roof including Design, Casting, Fabrication, Assembly & Testing and provides the most varied range of these products in largest possible sizes. To ensure this, the company is continuously investing in its manufacturing capability as well as in development of new products & technologies either on its own or through collaboration with suitable technology partners and leaders in the trade.

The company is a market leader in India for most of the products that it manufactures and is also among the first 5 in the world in the Water control gates business. Various brands belonging to the company and its subsidiaries are approved and registered in most of the countries and this ensures availability of wide export market for the company. Over 50% of company business comes from sales outside India and the company aims to increase this to nearly 65% in the foreseeable future.

B. YEAR IN RETROSPECT (I) PERFORMANCE

In the financial year 2019-20, the company achieved significant growth in its consolidated turnover as well as profit. The Consolidated total revenue of the Company for the year at Rs. 28564.13 lacs (Rs. 2856.41 million) shows a growth of approximately 12% over the previous year turnover of Rs. 25468.51 lacs (Rs. 2546.85 million). The Consolidated net profit of the Company for the year was Rs. 2009.67 lacs (Rs. 200.96 million) as compared to previous year net profit of Rs. 769.59 lacs (Rs. 76.95million), showing a growth of approximately 161 % over the previous year. The Net profit at the consolidated level could have been higher but for the losses sustained in our US subsidiary. Reduction in losses and consequent return to profitability will boost the net profits at the consolidated level in the coming years.

In the financial year 2019-20, the company achieved moderate growth in its standalone turnover accompanied with significant improvement in profit. The standalone total revenue of the Company for the year at Rs. 21433.48 lacs (Rs. 2143.34 million) shows a growth of approximately 4.5% over the previous year turnover of Rs. 20495.53 lacs (Rs. 2049.55 million). The net profit of the Company for the year was Rs. 2181.74 lacs (Rs. 218.17million) as compared to previous year net profit of Rs. 1717.78 lacs (Rs. 171.78 million), showing a growth of approximately 27 % over the previous year.

The standalone domestic sales of the Company during the year was Rs. 13420.13 lacs (Rs. 1342.01 million) as compared to previous year sales of Rs. 11783.59 lacs (Rs. 1178.36 million), exhibiting an increase of 14% over the previous year. The standalone export sales of the Company during the year was Rs. 7142.77 lacs (Rs. 714.28 million) as compared to previous year sales of Rs. 8308.19 lacs (Rs. 830.82 million), exhibiting decrease of 14 % over the previous year.

The entire operations of the company were shut down at Indore and Pithampur plants from 22nd March 2020 due to Covid-19 lockdown. Operations in Chennai and in USA were also closed down during this period. Historically sales of between 5-10% of turnover is registered in the last 10 days of the financial year. However due to lockdown, this could not happen in this year and as a result of this, the standalone turnover of individual companies, the consolidated turnover as well as the overall profitability of the company declined. The performance of the Company has been creditable despite these headwinds.

(ii) NEW ACTIVITIES & DEVELOPMENTS

The company had invested in a new manufacturing facility at SEZ Pithampur in Financial year 2018-19. The Commercial Production at this plant has commenced from 12th July 2019 and this facility is now operative for a year and is fully geared to cater to future export business.

The company developed and manufactured perforated fine travelling band screens for the first time in India and has successfully installed and commissioned the same at 100 MLD Nemmeli Desalination plant at Chennai and at Sea water intake system of RSPL at Dwarka. This will tremendously boost the companys capability and acceptance to cater to the desalination business in middle east as well as in India.

The Aluminum stoplogs for prevention of flooding at LaGuardia Airport, New York was executed to the expectation of the client with good feedback on quality and workmanship.

(iii) SUBSIDIARIES

a) SHIVPAD ENGINEERS PVT. LTD. , INDIA

Shivpad Engineers Pvt. Ltd. is a wholly owned subsidiary of the Company, operating in Ambattur Industrial Estate, Chennai - 600058. Tamilnadu, India. It is engaged in Design, Manufacture and Supply of treatment process equipment for Water Treatment, Waste Water Treatment and Sewage Treatment Plants and also Chemical process Industry equipment related to solid - liquid separation viz., Milk of Lime preparation plant equipment, Multi-deck Clarifiers, Rake & Screw Classifiers and other ancillary business.

In the financial year 2019-20, the company achieved excellent growth in its turnover accompanied with significant improvement in profit. The total revenue of the Company for the year at Rs. 1802.68 lacs (Rs. 180.26 million) shows a growth of approximately 36% over the previous year turnover of Rs. 1328.50 lacs (Rs. 132.85 million). The net profit of the Company for the year was Rs. 337.19 lacs (Rs. 33.71million) as compared to previous year net profit of Rs. 249.84 lacs (Rs. 24.98 million), showing a growth of approximately 35 % over the previous year.

The company continues to outperform its peers and is on track to become a major player in Indian market with sales in excess of Rs. 3500 lacs (Rs. 350 million ) in 4 years time.

b) JASH USA INC. / RODNEY HUNT INC., USA

Rodney Hunt Inc is a wholly owned subsidiary of the Company, operating in Houston, Texas 77036, USA with its manufacturing facility in Orange, Massachusetts. It is engaged in manufacturing wide range of water control gates and

equipment for Water Intake Systems, Water and Waste Water Pumping Stations and Treatment Plants, Storm Water Pumping Stations, Water Transmission Lines and for various industries.

In the financial year 2019-20, the company achieved moderate growth in its turnover accompanied with significant reduction in losses. The total revenue of the Company for the year at USD 11.57 million (equivalent to Rs. 8715.89 lacs / Rs. 871.58 million) showed a growth of approximately 8% over the previous year turnover of USD 10.74 million (equivalent to Rs. 8094.02 lacs / Rs. 809.40 million). The net loss of the Company for the year was USD -0.47 million (equivalent to Rs. -357.85 lacs / Rs. -35.78 million) as compared to previous year net loss of USD -1.52 million (equivalent to Rs. -1148.74 lacs / Rs. -114.87 million) showing a reduction of approximately 69 % over the previous year loss.

This is the 3rd full year of the company post its acquisition and 1st full year of the operation of its acquired manufacturing facility. The reduction in the loss augers well for the company which is on its path to become a profit-making company in the 4th year of its establishment.

c) ENGINEERING & MANUFACTURING JASH LIMITED, HONGKONG

Engineering & Manufacturing JASH Limited, is a wholly owned marketing subsidiary of the Company operating in Tsimshatsui, Kowloon, Hong Kong. It is engaged in marketing of Screening and Screening conveying equipment manufactured under E&M Jash Brand, a well-established and approved brand with DSD, Hongkong. The company has no employees and its products are made using Mahr Maschinenbau technology while manufacturing is done in Jash Engineering facility at SEZ Pithampur.

In the financial year 2019-20, the company did not do any business and has reported minor losses. The total revenue of the Company for the year was NIL as against the previous year turnover of HKD 1.24 million (equivalent to Rs. 121.3 lacs / Rs. 12.13 million). The net loss of the Company for the year was HKD -0.12 million (equivalent to Rs. - 12.04 lacs / Rs. -1.20 million) as compared to previous year net loss of HKD - 0.04 million (equivalent to Rs. - 4.80 lacs / Rs. - 0.48 million).

Hongkong was in turmoil for most part of financial year 2019-20 , first because of political unrest and thereafter because of Covid pandemic and this affected regular business activities.

d) MAHR MASCHINENBAU Ges.m.b.H, AUSTRIA

Mahr Maschinenbau Ges.m.b.H, is a wholly owned subsidiary of the Company operating in Hagenbrunn, Austria. It is now engaged in development of new technology for Screening and Screenings handling equipment and all its manufacturing activities have been closed down.

In the financial year 2019-20, the company achieved moderate reduction in its turnover accompanied with slight reduction in losses. The total revenue of the Company for the year at EURO 0.15 million (equivalent to Rs. 128.91 lacs / Rs. 12.89 million) shows a reduction of approximately 4% over the previous year turnover of EURO 0.172 million (equivalent to Rs. 134.19 lacs / Rs. 13.49 million). The net loss of the Company for the year was of Euro -0.11 million (equivalent to Rs. -94.06 lacs / Rs. -9.40 million) as compared to previous year net loss of EURO -0.195 million (equivalent to Rs. -152.27 lacs / Rs. -15.22 million) showing a reduction of approximately 38 % over the previous year loss.

3. PROSPECTS FOR YEAR 2020-21

A. DOMESTIC MARKET SITUATION

The potential of Indian water and waste water industry is enormous on account of the burgeoning urban and semi-rural population and the fact that even after 70 years of independence the total waste water treatment does not meet even 50% of total country requirement. However, on account of Covid19 pandemic, the government will be strapped for funds and this may affect funding on new projects. The Indian infrastructure industry was already limping due to cash flow crisis, partially inflicted by banks and partially by delayed payment by executing agencies and this shall further get aggravated due to Covid leading to projects getting stuck and deliveries getting delayed. Nearly 49 % of our consolidated revenue is still coming from Indian business and as a result some part of our growth could be affected if higher percentage of Indian projects are affected by this crisis.

B. INTERNATIONAL MARKET SITUATION

Countries worldwide are investing heavily in water, waste water, storm water, desalination and in water reuse infrastructure and so international market for equipment made by the company is quite strong. Countries like Singapore, Malaysia, Thailand, Philippines, Hongkong, Qatar, Saudi Arabia , Abu Dhabi, France, UK and USA where the company has strong presence are investing heavily in water sector. The company is bidding for supply of equipment worth over Rs 400 crores from projects already announced and tendered out in these countries and which are sure to be

finalized in this financial year. The company is quite hopeful of bagging over 30% of these orders and this should help in shoring up our order book position for the financial year 2020-21 as well as 2021-22.

On account of Covid19 pandemic, project execution in many countries have slowed down. As a result it may not be possible to attain high growth from export market despite a good current order book position. Nearly 51 % of our consolidated revenue is coming from export business due to which some part of our growth could be affected if most of the countries where we have good business presence are affected by this crisis.

C. SALES GROWTH STANDALONE

(I) JASH ENGINEERING LIMITED, INDIA

The total order book position of the Company as on 1st August 2020 (Orders in hand as on 1st April 2020 plus orders received till 31st July 2020 less sales effected till 31st July end 2020) is. Rs. 24195 lacs (Rs. 2419.5 million). Adding orders received from Rodney Hunt, USA and E&M Jash, Hongkong for manufacturing of their products in India, the total order book position becomes Rs. 28316 lacs (Rs.2831.6 million ). Further orders worth Rs. 5316 lacs (Rs.532 million) are already negotiated and expected to be received within next two months.

On the basis of the sales achieved till 31st July 2020 of approx Rs.3200 lacs (Rs. 320 million), the current order book position and expected order inflow, we are looking at overall year on year growth between 10 % to 12 % in the year 2020-21.

(ii) SHIVPAD ENGINEERS PVT. LTD., INDIA

The total order book position of the Company as on 1st August 2020 (Orders in hand as on 1st April 2020 plus orders received till 31st July 2020 less sales effected till 31st July end 2020) is.Rs. 2427 lacs (Rs. 242.7 million). Further orders worth Rs. 350 lacs (Rs.35 million) are already negotiated and expected to be received within next two months.

On the basis of the sales achieved till 31st July 2020 of Rs. 250 lacs (Rs. 25 million), the current order book position and expected order inflow, we are looking at overall year on year growth between 10 % to 15 % in the year 2020-21. Even though the company is very comfortably placed order wise it may still not be able to post significant growth this year due to long Covid imposed shutdowns in Chennai city.

(iii) JASH USA INC. / RODNEY HUNT INC., USA

The total order book position of the Company as on 1st August 2020 (Orders in hand as on 1st April 2020 plus orders received till 31st July 2020 less sales effected till 31st July end 2020) is Us$ 16.13 million (Rs. 12083 lacs / Rs. 1208 million). Further orders worth approx. US$ 1.42 million (Rs. 1070 lacs / Rs. 107 million) are already negotiated and expected to be received within next two months.

On the basis of the sales achieved till 31st July 2020 of approx. US$ 1.9 million ( Rs. 1425 lacs / Rs. 142.50 million), the current order book position and expected order inflow, we are conservatively looking at overall year on year growth between 25 % to 30 % in the year 2020-21.

(iv) ENGINEERING & MANUFACTURING JASH LIMITED, HONGKONG

The total order book position of the Company as on 1st August 2020 (Orders in hand as on 1st April 2020 plus orders received till 31st July 2020 less sales effected till 31st July end 2020) is HK 0.96 million (equivalent to Rs. 94 lacs / Rs. 9.4 million). Further order worth HK 4.04 million (equivalent to Rs.394 lacs / Rs.39.4 million) is already negotiated and is expected to be received within next one month.

Due to COVID-19 pandemic, No sales have been registered until 31st July. However, on the basis of current order book position and expected order inflow, we are looking at sales of HK 1.5 million (equivalent to Rs. 125 lacs / Rs. 12.5 million) in the year 2020-21.

(v) MAHR MASCHINENBAU Ges.m.b.H, AUSTRIA - STANDALONE

It was mutually decided with Mr. Gernot Mahr while acquiring this company that he will assist the company for 5 more years in marketing and development activities. This period was further extended by 1 year and this extension will now expire in 2020-21. It has hence been decided to merge this company with Jash Engineering Ltd., and close down the same after merger. To retain the name a new partnership company under same name will be opened up.

D. SALES GROWTH CONSOLIDATED

The consolidated order book position of the Company as on 1st August 2020 (Orders in hand as on 1st April 2020 plus orders received till 31st July 2020 less sales effected till 31st July end 2020) is.Rs.38824 lacs (Rs.3882 million). Further orders worth Rs. 7129 lacs (Rs.713 million) are already negotiated and expected to be received within next two months.

On the basis of the sales achieved till 31st July 2020 of approx. Rs. 4500 lacs (Rs. 450 million), the current order book position and expected order inflow, we are looking at overall year on year growth between 15 % to 20 % in the year 2020-21 on consolidated basis.

While arriving at these growth figures we have assumed that the worst is over for us in relation to Covid19 pandemic and that our operations across various plants shall not be further affected by this from August 2020 onwards.

4. FUTURE OUTLOOK & PLANS

A. RODNEY HUNT

Financial year 2020-21 shall be the 4th full year after acquisition of Rodney Hunt and 2nd full year after commencement of the manufacturing at Orange plant. The USA market for water control equipment is of over USD 100 million annually and of we expect to have nearly 15% market share in the current year and become profitable. This will enable us to become one of the 4 major players in the USA market and establishes Rodney Hunt as a serious contender in the market. Onc establish ourselves as a viable competitor then we are quite hopeful of change in market perception leading to increased business traction throughout USA which should enable us to double our sales in US in 4 years time and reach the top position once again. We have commenced the process of our strengthening of our US team in line with this and will have a younger and dynamic organization in place by end of this year to meet this challenge.

B. CAPITAL INVESTMENT

Growth in USA will put additional pressure on Indian facility as nearly 70% of production for USA will be catered to from India. Hence Indian facility also has to be gradually expanded in phases so as to meet this expected surge in demand from USA in next 2 years. The aim is to equip SEZ Unit 3 in such a way that complete cast iron gates and cast valves can be machined, assembled, tested and dispatched from Unit 3 in 1.5 years time from now with only castings coming from outside.

In the current financial year, the company is making major investment in expanding the SEZ Unit 3. The built-up area of the plant is being increased by about 10,000 sq feet in Phase 1 so as to install large machines coming from Rodney Hunt plant in USA. The Phase 1 plant extension should have been completed by June end ie well before the arrival of the machines from USA but because of Covid imposed lockdown the civil works could not be completed in scheduled time. The plant is now expected to be ready by Sept/Oct 2020 for installation of machines which have already arrived in last week of July. As per the revised schedule, all these machines will be upgraded, installed and commissioned by Jan/Feb 2021. With the completion of Phase 1 the SEZ Unit 3 will be able to share the machining load for CI gates and valves for export market thereby freeing up capacity in Unit 1 for domestic market.

In addition to this major investment in SEZ Unit 3 various other minor investments in plant, machinery and facilities are being done in Unit 1, Unit 2 and Unit 4. These investments are being done for enhancing capacity, productivity and employee facilities.

This entire investment will be in the range of Rs. 750-800 lacs (Rs. 75-80 million) and will be funded by loans. Upon completion of Phase 1 expansion in SEZ Unit 3, the Phase 2 expansion of SEZ Unit 3 is planned to be taken up. However, the decision regarding timeline of this expansion will be taken in the last quarter of current financial year based on the business condition pravailing at that point in time.

C. SAP IMPLEMENTATION

The company has achieved good progress in SAP implementation and barring Covid this should have been operational in May 2020. However, work on this has once again commenced from end of June and this will finally be operative in the month of August 2020. Before the end of second quarter of financial year 2020-21 the company will be shifting all operations on SAP.

D. NEW PRODUCT ADDITION / DEVELOPMENT

The company has a policy of adding new products every year with a view to improve its product portfolio and maintain its leadership position in India. Product addition can be done either by in house development or by tie up with a technology leader abroad. In the current year the company is planning addition / development of following products:

(I) DISC FILTERS:

The company has already tied up with Invent Germany for manufacture of Disc Filters in India. The first protype machine for demonstration purpose will be dispatched from Germany in October 2020 and installed in the companys own Sewage treatment plant by Nov 2020. This will help our engineers in understanding the technology as well as understand operational and maintenance issues. Thereafter, subject to there being no travelling restriction related to Covid19, the company aims to send a team of engineers to Germany early next year for training in manufacture and assembly of this product. We expect to have the first machine produced in India by the middle of new year.

(ii) BACK RAKING SCREEN:

The company has already developed a prototype screen based on Mahr Maschinenbau design and installed it in the IMC Kabitkhedi STP plant few years back for trials. The upgraded version is now under development in Austria and we will manufacture the same and have the prototype ready by end of the year. We plan to deploy this design in storm water application.

(iii) CABLE OPERATED RAKING SCREEN:

This is an economical screen in comparison to the existing screens available with the company. Few competitors are successfully promoting this screen even though it performance is not as good as good as Chain driven raking screens. The company has hence decided to develop this screen alternative so that no space is given to its competitors to grow and become a threat to company dominance in time to come. This development is being done in Austria and the first prototype will be ready before the end of this year.

5. OCCUPATION HEALTH & SAFETY (OH&S):

Your company involved in an initiative which results to positive engagement of personnel on the plant at every level. With regard to safety, two key areas of focus were identified, namely facility Management for the employees and Equipment, Tools & Material Management. The Facility management initiative was implemented to ensure adequate welfare facilities for labor such as washrooms with bathing facilities, rest rooms, availability of drinking water etc. The Equipment, Tools & Material Management Program ensured that the tools used by them were safe. The process of screening was aligned with the Companys objectives to ensure Zero Harm. The Company has complied with all applicable environmental and labor laws.

6. SUBSIDIARY, ASSOCIATE AND JOINT VENTURE OF THE COMPANY

The details of wholly owned subsidiaries continuing having status of the same is given as required under section 129(3) of the Act, read with the Companies (Accounts) Rules, 2014 in the FORM AOC-1 as containing part of the Annual Report annexed as Annexure- A.

Further the Company does not have any associate or joint venture company at the beginning or closing or any time during the year 2019-20.

7. DIVIDEND

The Board of Directors declared an interim dividend of 15% on face value of fully paid up shares i.e. Rs. 1.5/- per share of Rs. 10/- for the year 2019-20 on dated 07/03/2020. The aggregate amount of interim dividend was Rs.177.54 Lacs /-, which was duly paid. Further the board on its meeting held on 25/06/2020 recommended, subject to approval of shareholders, a final dividend of 9% on Face Value of fully paid up Shares i.e. Rs. 0.90/- per share of Rs. 10/- each for the Financial Year 2019-20. The aggregate amount of final dividend is Rs. 106.52 Lacs /-.

8. TRANSFER TO RESERVES

For the Financial year ended 31st March, 2020, Your Company has not transferred any amount to General Reserve out of profit available for appropriation.

9. MANAGEMENTS DISCUSSION AND ANALYSIS REPORT:

Management Discussion and Analysis forms an integral part of this report and is annexed as "Annexure- B" which gives details of the overall industry structure, economic developments, performance and state of affairs of the Companys various businesses.

10. CORPORATE GOVERNANCE REPORT:

Your company continues to place greater emphasis on managing its affairs with diligence, transparency, responsibility and accountability and is committed to adopting and adhering to best corporate governance practices.

The Company has a strong legacy of fair, transparent and ethical governance practices and it is believed that good Corporate Governance is essential for achieving long term corporate goals and to enhance stakeholders value. Your Company implements Corporate Governance through robust board governance processes, internal control systems and processes, and strong audit mechanisms. However the provisions of Regulation 15 of SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015 providing a separate report on corporate governance under Regulation 34(3) read with para C of Schedule V are set out in the "Annexure C" to this report.

11. 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 31st, 2020, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;

b. 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 31st, 2020 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.

12. INTERNAL CONTROL

Given the nature of business and size of operations, Your Companys Internal Control System has been designed to provide for:

- Accurate recording of transactions with internal checks and prompt reporting.

- Adherence to applicable Accounting Standards and Policies.

- Compliance with applicable statutes, policies and management policies and procedures.

- Effective use of resources and safeguarding of assets.

The Internal Control System provides for well documented policies/guidelines, authorizations and approval procedures. Your Company, through its Internal Auditors M/s. Mahesh C Solanki & Co, Chartered Accountants , engaged as Internal auditors for the financial year 2019-20 carried out periodic audits at all locations and functions based on the plan approved by the Audit Committee and brought out any deviation to Internal Control procedures. The observations arising out of the audit are periodically reviewed and compliance ensured.

The summary of the Internal Audit observations and status of implementation are submitted to the Audit Committee. The status of implementation of the recommendations is reviewed by the Audit Committee on a regular basis and concerns, if any, are reported to the Board.

Your Company, as per the requirement of the Section 143 (3) (i) has carried out extensive testing of the internal financial controls in the Company which has also been duly audited by the Statutory Auditors of the Company and which have been found to be adequate and satisfactory.

13. BOARD OF DIRECTORS

COMPOSITION OF BOARD OF DIRECTOR AND KEY MANAGERIAL PERSONNEL:

During the year under review, the following changes occurred in the position of Directors/KMPs of the Company. In compliance with the provisions of Sections 149, 152 read with Schedule IV and all other applicable provisions of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014 (including any statutory modification(s) or reenactment thereof for the time being in force) and SEBI (LODR) Regulation 2015, the composition of Board of Directors and Key Managerial Personnel are as follows:-

Sr. Name of the Director No. DIN Designation
1. Mr. Laxminandan Amin * 00007735 Executive Director
2. Mr. Pratik Patel ** 00780920 Chairman & Managing Director
3. Mr. Suresh Patel*** 00012072 Executive Director
4. Mr. Axel Schutte 02591276 Non-Executive Director
5. Mr. Brij Mohan Maheshwari 00022080 Independent Director
6. Mr. Sunil Kumar Choksi 00155078 Independent Director
7. Ms. Sunita Kishnani 06924681 Independent Director
8. Mr. Durgalal Tuljaram Manwani 07114081 Independent Director
9. Mr. Vishwapati Trivedi 00158435 Independent Director

* Mr. Laxminandan Amin has resigned from the Directorship w.e.f. 31/03/2020.

** Mr. Pratik Patel has been appointed as the Chairman of the Company w.e.f. 25/06/2020

*** Mr. Suresh Kumar Patel has been appointed as an Executive Director of company w.e.f. 14/02/2020.

Board Independence

Our definition of Independence of Directors or Regulation is derived from Regulation 16 of SEBI (LODR) Regulations, 2015 and Section 149(6) of the Companies Act, 2013. The Company comprised total 9 directors as on 31st March 2020 in the Board out of them the following directors are independent directors;

1. Mr. Durgalal Tuljaram Manwani

2. Mr. Sunil Choksi

3. Mr. Brij Mohan Maheshwari

4. Ms. Sunita Kishnani

5. Mr. Vishwapati Trivedi

Declaration and Re-appointment of Independent Director:

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. Further, as per provisions of the Companies Act, 2013, Independent Directors were appointed for a term of 5 (five) consecutive years, but shall be eligible for re-appointment by passing of a special resolution by the Company and shall not be liable to retire by rotation.

The Company also consists of the following Key Managerial Personnel.

1. Mr. Dharmendra Jain CFO
2. Mr. Tushar Kharpade Company Secretary

Changes in Directors and Key Managerial Personnel

1. Mr. Suresh Kumar Patel (DIN: 00012072) appointed, subject to approval of shareholder in ensuing Annual General Meeting, as Executive Director of the Company w.e.f. 14th February, 2020.

2. Upon recommendation of the Nomination and Remuneration Committee board has considered and approved the renewal of terms and conditions of appointment of Mr. Pratik Patel (DIN: 00780290) as Managing Director of the Company for two years w.e.f. 01.03.2020 subject to approval of shareholders at the ensuing general meeting and other as may be required.

3. Mr. Pratik Patel (DIN: 00780920) has been appointed as a Chairman of the company in the meeting dated 25th June 2020.

4. Mr. Laxminandan Amin (DIN No.: 00007735) has resigned from Directorship of the Company, w.e.f. 31st March, 2020, due to advancing age and health issue. A note about the resignation w.e.f. 31.3.2020 has been taken by the Board of Director in the meeting dated 25th June 2020.

MEETINGS OF THE BOARD

The Board meets at regular intervals to discuss and decide on Company/business policy and strategy apart from other

Board business. Four meetings of the Board were held during the year under review. For details of meetings of the

Board, please refer to the Corporate Governance Report, which is a part of this report.

COMMITTEES OF THE BOARD

Your Company has constituted the Committee(s) as mandated under the provisions of the Act and Listing Regulations. Currently, there are five committees of the Board, namely:

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholders Relationship Committee:

• Corporate Social Responsibility Committee

• Executive & Borrowing Committee

The details of Board Committees are prescribed in Annexure-C of Board Report.

COMPANYS POLICY ON DIRECTORS APPOINTMENT, REMUNERATION AND BOARD EVALUATION

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), is annexed with the Report as "Annexure-D" and is uploaded on companys website www.iashindia.com

BOARD EVALUATION :

Our Company has conducted an Annual Performance Evaluation for all Board Members as well as the working of the Board and its Committees. This evaluation was led with specific focus on performance and effective functioning of the Board. The Board evaluation framework has been designed in compliance with the requirements under the Companies Act, 2013 and the Listing Regulations. In a separate meeting of Independent Directors, performance of NonIndependent Directors, performance of the Board as a whole was evaluated, taking into account the views of the Executive Directors and Non Executive Directors. The same was discussed in the Board Meeting that followed the meeting of the Independent Directors, at which the performance of the Board, its committees and individual Directors was also discussed.

The following are some of the broad issues that are considered in performance evaluation:

• Evaluation of the Board was based on criteria such as composition and role of the Board, Board communication and relationships, functioning of Board Committees, review of performance of Executive Directors, succession planning, strategic planning etc.

• Evaluation of Committees was based on criteria such as adequate independence of each Committee, frequency of meetings and time allocated for discussions at meetings, functioning of Board Committees and effectiveness of its advice/recommendation to the Board etc.

• Evaluation of Directors was based on criteria such as participation and contribution in Board and Committee meetings, representation of shareholders interest and enhancing shareholding value, experience and expertise to provide feedback and guidance to top management on business strategy, governance, risk and understanding of the organizations strategy etc.

The outcome of the Board Evaluation for the financial year 2019-20 was discussed by the Board and on the basis of such discussion Board analysis the result of actions taken by Board for improving Board effectiveness based on feedback received in the previous year. Further, the Board also noted areas on which Board requires more focus for the future Board efficiency.

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 Company has adopted a Code of Conduct for all Directors and Senior Management of the Company and same has been hosted on the website of the company www.iashindia.com

14. AUDITOR AND AUDITORS REPORT:

STATUTORY AUDITOR:

M/s Walker Chandiok & Co LLP, Chartered Accountants (Firm Registration No. 001076N/N500013), the Statutory Auditors were reappointed for a term of 5 years at Annual General Meeting of the Company held on 30th Sept., 2017 and they have confirmed their eligibility under Section 141(3)(g) of the Companies Act, 2013 and the rules framed hereunder for ratification by the Members for appointment as Statutory Auditors of the Company for Financial Year 2019-20. As required under Regulation 33(d) of the SEBI (LODR) Regulation, 2015, the auditor has also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

There are no qualifications, reservations or adverse remarks made by M/s Walker Chandiok & Co LLP, Statutory Auditors, in their report prescribed in this Annual Report for the financial year ended March 31,2020.

SECRETARIAL AUDITOR:

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 Mr. Ankit Joshi, Practicing Company Secretaries, to conduct Secretarial Audit of the Company. The Report of the Secretarial Audit in Form MR-3 for the financial year ended March 31,2020 is enclosed as "Annexure-E" to Board Report.

The Secretarial Audit Report for the year 2019-20 is self-explanatory except the following comments made and the management submits their comments:

1. Some Forms under Companies Act, 2013 were filed by the Company after prescribed timeline along with the adequate additional filing fees.

Management Response to Point No. (1) : Your Company is law abiding entity and filed the necessary forms & returns with the authorities. The management is hopeful and committed to their level best to streamline the same in future. There was some delay in filing of the particulars forms and has already complied with the same and has paid additional fees as prescribed.

2. Pursuant to Section 135 of the Companies Act, 2013 read with applicable rules Company was required to spend CSR Contribution of Rs.30.08 Lacs during the financial year 2019-20, however the Company has spent Rs.14.99 Lacs only during the year 2019-2020.

Management Response to Point No ( 2) : The company has contributed Rs.14.99 lakhs during the year towards CSR initiatives. The areas targeted by the Company were new therefore the planning and management of activities was not so smooth and took a reasonable amount of time.

COST AUDITOR:

Pursuant to the provision of Section 148 of the Companies Act, 2013 pertaining to audit of cost records is applicable to the Company. The Board has appointed M/s M.P. Turakhia & Associates, Cost Accountant to audit the cost records of you company for the financial year 2019-20.

INTERNAL AUDITOR

Pursuant to the provisions of Section 138 of the Companies Act, 2013 and rule thereunder and regulation 18(3) of SEBI LODR and based on the recommendations of Audit Committee, your Board have reappointed M/s. Mahesh C. Solanki & Co. (FRN 006228C), Chartered Accountants, Indore as Internal Auditor of the Company to conduct the Internal Audit of the Company for the FY 2019-20. The Internal Auditors reports directly to the Audit Committee and make comprehensive presentations at the Audit Committee meeting(s) on the Internal Audit Report.

Your Board has reappointed M/s. Mahesh C. Solanki & Co. (FRN 006228C), Chartered Accountants, Indore as Internal Auditor of the Company for the FY 2020-21.

15. DISCLOSURE REQUIREMENTS:

As per the Provisions of the SEBI (LODR) Regulations, 2015 entered into with the stock exchanges, corporate governance report with auditors certificate thereon and management discussion and analysis are attached, which form part of this report.

Details of the familiarization programme of the independent directors are available on the website of the Company. www.jashindia.com

16. EMPLOYEE STOCK OPTION SCHEME:

In the present competitive economic environment in the country and in the long-term interests of the Company and its shareholders, it is necessary that the Company adopts suitable measures for attracting and retaining qualified, talented and competent personnel. An employee stock option scheme, designed to foster a sense of ownership and belonging amongst personnel, is a well-accepted approach to this end. It is, therefore, appropriate to consider an Employee Stock Option Scheme for the employees of the Company and/or subsidiary company(ies) whether working in India or abroad. The Nomination and Remuneration Committee, inter alia administers and monitors the Companys employees stock option scheme (ESOP Scheme) in accordance with the applicable SEBI (Share Based Employee Benefits) Regulations, 2014 (SEBI SBEB).

During the year under review, the Company has approved "Jash Engineering Employee Stock Option Scheme 2019" (JASH Scheme 2019) of the Company. The ESOP Scheme is in compliance with the SEBI (Share Based Employee Benefits) Regulations, 2014 (the SBEB Regulations). Pursuant to the approval by the shareholders and in-principle approval given by the Stock Exchanges, the Company can grant upto 5,75,000 options to the eligible employees of the Company under the JASH Scheme 2019.

17. MIGRATION FROM SME PLATFORM TO MAINBOARD OF NSE

During the year Migration of equity shares from SME Emerge platform to Main Board of NSE was also approved by the National Stock Exchange w.e.f. 30th October, 2019 on the basis of the details given below:

Sr. No. Description of Securities Symbol Series No. of Securities Mkt . Lot Distinctive Numbers
1. Equity shares of Rs.10/- each fully paid up JASH EQ 1,18,36,598 1 1 to 1,18,36,598

18. THE INDIAN ACCOUNTING STANDARDS (IND-AS):

Your Company has migrated from SME Emerge platform to Main Board of NSE w.e.f. 30th October, 2019. Therefore, FY 19-20 was the first FY to prepare the Financial Statements as per the IND -AS accordingly both Standalone and Consolidated financial statements has been prepared according to Indian Accounting Standard (IND-AS).

19. HUMAN RESOURCE DEVELOPMENT:

Attracting, enabling and retaining talent have been the cornerstone of the Human Resource function and the results underscore the important role that human capital plays in critical strategic activities such as growth. A robust Talent Acquisition system enables the Company to balance unpredictable business demands with a predictable resource supply through organic and inorganic growth.

The re-imagined focus on competency building of fresh recruits prior to joining through unique digital Initial Learning Program approach has enabled faster release of freshers to projects. Post-offer engagement activities have also witnessed increased focus. Continual pursuit to connect with associates on a regular basis, communicate in an open and transparent manner, progressive HR policies. This is evident from the high retention rates and improved engagement levels of the associates.

20. DEPOSITS

Your Company has not accepted deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014 and there were no remaining unclaimed deposits as on 31st March, 2020. Further, the Company has not accepted any deposit or loans in contravention of the provisions of the Chapter V of the Companies Act, 2013 and the Rules made there under.

21. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The Company has complied in respect of loan and guarantees and investment pursuant to Section 186 of the Companies Act, 2013.

22. RELATED PARTY TRANSACTIONS

All Related Party Transactions that were entered into during the Financial Year 2019-20 were on Arms Length Basis and were in the Ordinary Course of business. There are no materially significant Related Party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. All Related Party Transactions were approved by the Audit Committee on omnibus basis or otherwise and the Board. The transactions entered into by the company are audited. The Company has developed Related Party Transactions Policy, Standard Operating Procedures for purpose of identification and monitoring of such transactions. The information for the Related Party Transactions has been given in AOC-2 as "Annexure-F". The RPT Policy as approved by the Board is available on the Companys website www.iashindia.com.

23. 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-G".

24. CORPORATE SOCIAL RESPOSIBILITY:

The Company has developed and implemented Corporate Social Responsibility initiatives as the said provisions are applicable in view of the profits and turnover of the company, your Company was required to undertake CSR projects during the year 2019-20 under the provisions of section 135 of the Companies Act, 2013 and the rules made their under. As part of its initiatives under "Corporate Social Responsibility (CSR)", the Company has undertaken activities, which are in accordance with CSR Policy of the Company and Schedule VII of the Companies Act, 2013.The Annual Report on CSR activities is annexed herewith as "Annexure-H".

25. EXTRACT OF ANNUAL RETURN

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

26. LIQUIDATION OF MAHR MASCHINENBAU GES. MBH (WOS), AUSTRIA

During the year in view of revised business strategy of MAHR MASCHINENBAU, AUSTRIA (WOS of JASH Engineering Limited) the Board discussed the liquidation process of WOS i.e. MAHR MASCHINENBAU, AUSTRIA and approved for taking required steps to commence the liquidation process with the consultation of Advisor and Austrian Authority.

27. CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the provisions of Section 129(3) of the Companies Act, 2013 and Regulation 34 of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, the Consolidated Financial Statements forms part of this Annual Report and shall also be laid before the ensuing Annual General Meeting of the Company. The Consolidated Financial Statements have been prepared in accordance with the relevant Accounting Standards.

28. RISK MANAGEMENT :

Risks are events, situations or circumstances which may lead to negative consequences on the Companys businesses. Risk management is a structured approach to manage uncertainty. A formal enterprise wide approach to Risk Management is being adopted by the Company and key risks will now be managed within a unitary framework. As a formal roll-out, all business divisions and corporate functions will embrace Risk Management Policy and Guidelines, and make use of these in their decision making. Key business risks and their mitigation are considered in the annual/strategic business plans and in periodic management reviews. The risk management process in our multibusiness, multi-site operations, over the period of time will become embedded into the Companys business systems and processes, such that our responses to risks remain current and dynamic.

The Audit Committee, has been designated by the Board for reviewing the adequacy of the risk management framework of the Company, the key risks associated with the businesses of the Company and the measures are taken in place to minimize the same and thereafter the details are presented to and discussed at the Board meeting.

29. VIGIL MECHANISM POLICY FOR THE DIRECTORS AND EMPLOYEES:

The Companys Board of Directors, pursuant to the provisions of Section 177(9) of the Companies Act, 2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014, has framed Vigil Mechanism Policy for Directors and employees of the Company. The policy is to provide a mechanism, which ensures adequate safeguards to employees and Directors from any victimisation on raising of concerns of any violations of legal or regulatory requirements, incorrect or misrepresentation of any, financial statements and reports, and so on. The Vigil Mechanism Policy is hosted on the Companys website www.jashindia.com

30. PARTICULARS OF INTERNAL COMMITTEE AND COMPLAINTS RECEIVED UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013:

The Company has constituted the Internal Committee under the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 headed by the women employee of the Company. There is no complaint received during the year and pending at the ended financial year under provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Category No. of complaints pending at the beginning of F.Y. 2019-20 No. of complaints filed during the F.Y. 2019 -20 No. of complaints pending as at the end of F.Y. 2019 - 20
Sexual Harassment Nil Nil Nil

31. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

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.

32. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THIS REPORT;

Except that as stated in the relevant places, the material changes, development, regarding project which is ongoing, from the 31st March, 2020 till the date of the Board Reports, there are no material changes which may affect the financial position of the Company.

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

Pursuant to provision of section 197(12) of Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 details of employees given in "Annexure-J". During the year, none of the employees received remuneration in excess of Rs. One Crore and two lacs or more per annum, 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.

34. INDUSTRIAL RELATIONS:

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

35. PREVENTION OF INSIDER TRADING

In view of 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 Code requires Trading Plan, pre-clearance for dealing in the Companys shares and prohibition the purcharse or sale of Company shares by the Directors and the designated employee

36. DISCLOSURE FOR FRAUDS AGAINST THE COMPANY:

In terms of the provisions of Section 134(3)(C)(a) of the Companies Act, 2013, there were no frauds committed against the Company and persons who are reportable under section 141 (12) by the Auditors to the Central Government. Also, there were no non-reportable frauds during the Financial Year 2019-20.

37. CAUTIONARY STATEMENT

The statements made in this Report and Management Discussion and Analysis Report relating to the Companys objectives, projections, outlook, expectations and others may be "forward looking statements" within the meaning of applicable laws and regulations. Actual results may differ from expectations those expressed or implied. Some factors could make difference to the Companys operations that may be, due to change in government policies, global market conditions, foreign exchange fluctuations, natural disasters etc.

38. ACKNOWLEDGEMENTS

Your Directors acknowledge the dedication and commitment of your companys employees to the growth of your company and their unstinted support has been integral to your companys ongoing success. Your Directors appreciate support of State Bank of India, HDFC Bank Limited, SIDBI, TATA Capital Financial Services Limited, Bajaj Finance Ltd. and various government agencies, customers, suppliers throughout the year for their support and confidence shown in the management of the company. The Directors also gratefully acknowledge support of the NSE, Share Transfer Agent and other intermediaries of the Public Issue of the Company and also to all stakeholders of the Company viz. customers, members, dealers, vendors and other business partners for the excellent support received from them during the year.

For and on behalf of Board of Directors of Jash Engineering Limited
Date : 28.8.2020 Sd/- Sd/-
Place : Indore Pratik Patel Suresh Patel
Chairman & Managing Director Executive director
DIN - 00780920 DIN:00012072