Suryaamba Spinning Mills Ltd Directors Report.

Dear Members,

Your Directors have pleasure in presenting the 13th Annual Report on the business and operations of the Company, together with the audited accounts for the financial year ended March 31, 2020.

1. FINANCIAL RESULTS

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

(in lakhs)
Particulars As at year ended March 31, 2020 As at year ended March 31, 2019
Revenue from operations 16,219.29 16,866.22
Other income 94.07 63.20
Total Revenue 16313.36 16929.42
Earnings Before Interest, Taxes, Depreciation and 1768.55 1475.18
Amortisation
Less : Finance Cost 563.24 592.52
Less : Depreciation and Amortisation Expense 455.73 446.08
Profit before Tax 749.58 436.58
Less :Tax Expenses 229.13 94.56
Profit for the period 520.45 342.02
Other Comprehensive Income (net of tax) 14.02 33.12
Total Comprehensive Income 534.47 375.14
Earnings per share 17.75 11.67
Retained Earnings - Opening Balance 1040.65 701.29
Add: Profit for the year 534.47 375.14
Amount appropriated during the year:
Dividend including dividend tax paid 35.35 35.29
Transfer to General Reserves 0.50 0.50
Retained Earnings - Closing Balance 1,539.27 1040.65

2. RESULTS OF OPERATION

The revenue from operations during the financial year 2019-2020 stood at 16,219.29 lakhs as compared to 16,866.22 lakhs in the previous financial year. Domestic revenue constitutes 80.73% of total revenue from operations and Export revenue constitutes 18.77% of total revenue from operations.

The operating profit (EBIDTA) of the Company has increased from 1475.18 lakhs in the previous year to 1768.55 lakhs in the current year, registering an increase of 19.89%. Your Company recorded a net profit of 534.47 lakhs in the current year as compared to 375.14 lakhs in the previous year, registering a significant increase of 42.48%.The Company has reported Earnings per Share of 17.75 during the current year against 11.67 in the previous year.

Amidst the tough economic state of affairs, the performance achieved is the cumulative outcome of multiple factors such as product rationalization, capacity optimization, risk management, cost control measures, opting best financial solutions, seeking successful partnerships and efforts for exploring alliances, etc. taken by the management of your Company.

3. TRANSFER TO RESERVES

The Company has transferred 0.50 lakhs to the general reserve out of the amount available for appropriations for the financial year ended March 31, 2020.

4. DIVIDEND

The Company, after considering various external factors in correlation to impact of unprecedented COVID-19 pandemic as well as internal factors such as the long-term growth strategy of the Company and the liquidity position including working capital requirements, your Directors recommended a dividend of 0.60/- per equity share of the Company of 10/- each fully paid up (being 6%) for the financial year ended March 31, 2020, for the approval of the shareholders at the ensuing Annual General Meeting (‘AGM) of the Company. The total outgo on account of equity dividend inclusive of dividend tax for the FY 2019-20 would aggregate to 20.53 lakhs.

Further, the Board of Directors on February 14, 2020 have approved payment of Dividend on 8% Unlisted

Cumulative Redeemable Preference shares of the Company (CRPS) of the Company of 100/- each fully paid up for a period from April 01, 2019 up to the approved varied date of redemption i.e. March 12, 2020 (being 7.58%). The total outgo on account of preference dividend inclusive of taxes, for FY 2019-20 is 70.68 lakhs.

5. CAPITAL STRUCTURE

The Authorised Share Capital of the Company is 20,00,00,000/- divided into 50,00,000 number of equity shares of 10/- each and 15,00,000 number of Preference Shares of 100/- each. During the year under review there were no changes in authorized capital of the Company.

During the year, pursuant to Section 48 of the Companies Act, 2013 and consent letters received from preference shareholders approving variation of terms of issue of 8% Unlisted Cumulative Redeemable Preference shares (CRPS) of the Company by redeeming shares earlier than its due date, the Company redeemed existing 7,73,000 Preference Shares of 100/- each fully paid up along with accrued dividend till March 12, 2020.

Accordingly, the paid-up share capital of the Company reduced from 10,66,19,440/- divided into 29,31,944 equity shares of face value of 10/- each and 7,73,000 cumulative redeemable preference shares of 100/- each to 2,93,19,440 comprising 29,31,944 equity shares of face value of 10/- each. The Company has not issued any shares or convertible instruments during the financial year 2019-20.

6. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE COMPANY

There have been no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year to which the financial statements relate and the date of the report. There has been no change in the nature of business of the Company.

7. DIRECTORS AND KEY MANAGERIAL PERSONNEL a. Retirement by Rotation and subsequent re-appointment:

In terms of Articles of Association of the Company and as per Section 152(6) of the Companies Act, 2013, 2/3rd of the Board of Directors is considered to be Directors liable to retire by rotation, of which 1/3rd shall retire at every Annual General Meeting and the Company shall have an option to re-appoint the retiring Director or appoint someone else in his place.

Consequently, Smt. Seema Agarwal, Joint Managing Director (DIN: 01430206), retires by rotation at the ensuing Annual General Meeting and being eligible, has offered herself for re-appointment. The Board recommended her appointment at Item No. 4 of the Notice calling 13th Annual General Meeting for consideration of the shareholders.

b. Independent Directors:

Appointment:

During the year, on the recommendation of Nomination & Remuneration Committee, Mr. Nilesh Panpaliya was appointed as an Additional Director in the category of Non-Executive Independent Director, subject to approval of the shareholders, for a term of 5 (five) consecutive years w.e.f. July 03, 2019.

Pursuant to Section 161(1) of the Companies Act, 2013, at the twelfth Annual General Meeting (AGM) held on August 19, 2019, his appointment was regularized and approved by shareholders for a term of five (5) consecutive years w.e.f. July 03, 2019 up to July 02, 2024.

Re-appointment:

Based on outcome of performance evaluation exercise, experience and contributions the following recommendations were approved:

(i) Mr. Amit Goela was re-appointed as an Independent Director at the twelfth Annual General Meeting (AGM) held on August 19, 2019 for a second term of five consecutive years w.e.f. August 09, 2019 up to August 08, 2024; and

(ii) Mr. Sushil Kapadia was re-appointed as an Independent Director at the twelfth Annual General Meeting (AGM) held on August 19, 2019 for a second term of five consecutive years w.e.f. November 11, 2018 up to November 10, 2023.

Declaration by Independent Directors:

The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 along with rules framed there under and Regulation 16(1)(b) of the SEBI Listing Regulations. There has been no change in the circumstances affecting their status as independent directors of the Company.

c. Re-appointment of Mr. Mayank Agarwal as Whole-time Director of the Company:

On the recommendation of the Nomination & Remuneration Committee, the Board, at its meeting held on June 29, 2020 subject to the approval of the Members, approved the re-appointment and remuneration of Mr. Mayank Agarwal (DIN: 02749089) as the Whole-time Director of the Company for a period of five years with effect from August 01, 2020 to July 31, 2025. Approval of the shareholders for his re-appointment is sought at Item No. 7 of the Notice calling the 13th Annual General Meeting.

The brief resume of the directors proposed to be appointed/ re-appointed, as required to be disclosed under Regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is incorporated in the annexure to the notice calling 13th Annual General Meeting.

d. Key Managerial personnel:

Pursuant to the Section 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The Key Managerial Personnel of the Company as on March 31, 2020 are:

? Mr. Virender Kumar Agarwal, Chairman and Managing Director, ? Mrs. Seema Agarwal, Joint Managing Director, ? Mr. Mayank Agarwal, Whole time Director, ? Mr. Gajanan Chhawsaria, Chief Financial Officer and ? Ms. Deepa Dudani, Company Secretary & Compliance Officer.

8. BOARD MEETINGS

During the year, Six (6) Board Meetings were held. The details of Board Meetings with regard to their dates and attendance of each of the Directors thereat have been set out in the Corporate Governance Report which forms part of this Annual Report.

9. PERFORMANCE EVALUATION OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS

Pursuant to the provisions of Companies Act, 2013 and Regulation 17 and Part D of Schedule II of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations) read with SEBI Guidance Note dated January 5, 2017, the Board of Directors have carried out an annual evaluation of its own performance, Board Committees and individual Directors.

The performance of the Board and its Committees was evaluated by the Board after seeking inputs from all the Directors and Committee Members. Evaluation of Board is based on various aspects such as Board composition and structure, effectiveness of Board processes, Boards focus, contribution in the long term strategic planning, information and functioning, etc. Similarly, evaluation of committee is based on criteria such as structure and composition of Committees, their functioning, effectiveness of Committee meetings, etc.

The parameters for the performance evaluation of the Directors depend upon their roles and responsibilities, Directors profile and include attendance, effective participation and contribution in meetings of the Board and Committee meetings, domain knowledge, vision, strategy, execution and performance of specific duties, etc. At a separate meeting, lndependent Directors evaluated the performance of Non-Independent Directors, Chairman and performance of the Board as a whole.

Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

10. DIRECTORS RESPONSIBILITYSTATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013 (including any statutory modification(s) or re-enactment(s) thereof for the time being in force) the Directors of the Company confirm that:

i. in the preparation of the annual accounts for the year ended March 31, 2020 the applicable accounting standards and Schedule III of the Companies Act, 2013 have been followed and there are no material departures;

ii. 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 at the end of the financial year March 31, 2020 and of the profit of the Company for that period;

iii. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. the annual accounts for the year ended March 31, 2020 have been prepared on a going concern basis;

v. proper internal financial control laid down by the Directors to be followed by the Company and that such internal financial control are adequate and operating effectively; and vi. proper system to ensure compliance with the provisions of all applicable laws were in place and that such systems are adequate and operating effectively.

11. BOARD COMMITTEES

During the year, the Board of the Company had total three Committees namely Audit Committee, Nomination and Remuneration Committee and Stakeholders Relationship Committee. The details of composition and committee meetings during the year are given in the Corporate Governance Report which is a part of this Annual Report.

In compliance with and pursuant to applicability of provisions of Section 135 of the Companies Act, 2013 and rules made thereunder, for the financial year ended March 31, 2020, the Board of the Company at its meeting held on June 29, 2020 constituted Corporate Social Responsibility (CSR) Committee. The Committee comprises of the following members:

i. Mrs. Seema Agarwal, Joint Managing Director, Chairperson.

ii. Mr. Mayank Agarwal, Whole-time Director, Member.

iii. Mr. Amit Goela, Independent Director, Member.

12. POLICY ON DIRECTORSs APPOINTMENT, REMUNERATION AND OTHER DETAILS

Your Company has adopted a Nomination and Remuneration Policy for the Directors, Key Managerial Personnel and Senior Management employees pursuant to the requirement of Section 178 of the Companies Act, 2013 and Listing Regulations. The salient features of the Policy are set out in the Corporate Governance Report which forms part of this Annual Report.

The said Policy of the Company, inter alia, provides that the Nomination and Remuneration Committee shall formulate the criteria for appointment of Directors on the Board of the Company and persons holding Senior Management positions in the Company, including their remuneration and other matters as provided under Section 178 of the Act and Listing Regulations. The Policy is also available on the website of the Company http://www.suryaamba.com/investors/policies/.

13. VIGIL MECHANISM

Pursuant to the provisions of Section 177(9) of the Companies Act, 2013, the Company has established a "Vigil Mechanism" incorporating whistle blower policy in terms of Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 for employees and Directors of the Company, for expressing the genuine concerns of unethical behavior, actual or suspected fraud, leak or suspected leak of unpublished price sensitive information or violation of the codes of conduct by way of direct access to the Chairman/ Chairman of the Audit Committee. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns.

The Policy on Vigil Mechanism and whistle blower policy as approved by the Board may be accessed on the Companys website at the link: http://www.suryaamba.com/investors/policies/.

14. EXTRACTS OF ANNUAL RETURN

The Extract of Annual Return as provided under Section 92(3) of the Companies Act, 2013, and as prescribed in Form No. MGT-9 of the rules prescribed under Chapter VII relating to Management and Administration under the Companies Act, 2013, is made available on the Companys website and can be accessed from http://www.suryaamba.com/investors/ and also forms part of this annual report as ‘Annexure I.

15. AUDITORS AND AUDITORS REPORT

a. Statutory Auditor:

Pursuant to the provisions of Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, M/s S. Venkatadri & Co., Chartered Accountants (FRN: 004614S), Hyderabad, were appointed as the Statutory Auditors of the Company to hold office from the conclusion of the 8th Annual General Meeting (AGM) until the conclusion of 13th AGM.

Since, the tenure of M/s S. Venkatadri & Co., Chartered Accountants, Statutory Auditors shall conclude at the 13th AGM, the Board of Directors, after considering the recommendations of the Audit Committee has recommended the appointment of M/s. Manish N. Jain & Co, Chartered Accountants (FRN: 138430W), Nagpur as the Statutory Auditors of the Company for a period commencing from the conclusion of this Annual General Meeting till the conclusion of the 18th Annual General Meeting.

The Company has received a certificate from M/s. Manish N. Jain & Co., Chartered Accountants to the effect that the appointment, if made, would be in accordance with limits specified under the Companies Act, 2013 and as required under SEBI Regulations, they have confirmed that they hold valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

A resolution proposing their appointment, from the conclusion of this Annual General Meeting till the conclusion of the 18th Annual General Meeting of the Company, at a remuneration fixed by the Audit Committee and/or Board of Directors, is submitted at the Annual General Meeting for approval of the members. The Board recommends the appointment of M/s. Manish Jain & Co, Chartered Accountants as the Statutory Auditors, for approval of the members.

The Auditors Report for the financial year ended March 31, 2020 on the financial statements of the Company is a part of this Annual Report.

The observations made in the Auditors Report of M/s. S. Venkatadri & Co, Chartered Accountants, read together with relevant notes thereon, are self-explanatory and hence do not call for any comments. There is no qualification, reservation, adverse mark or disclaimer by the Statutory Auditors in their Report.

b. Cost Auditor:

The Company is maintaining the Cost Records, as specified by the Central Government under section 148(1) of Companies Act, 2013 read with Companies (Cost Records and Audit) Rules, 2014. The Cost Audit of the Cost and related records of the Company for the year 2019-20 was undertaken by Shri Ghanshyam Paliwal, Proprietor of M/s. G. R. Paliwal & Co., Nagpur the Cost Auditor of the Company.

The Board of Directors, on the recommendations made by the Audit Committee have re-appointed M/s. G. R. Paliwal & Co., Cost Accountants (Firm Reg. No.100058), Nagpur as Cost Auditors of the Company for the financial year 2020-21 to conduct cost audit of the accounts maintained by the Company.

The remuneration of Cost Auditors has been approved by the Board of Directors on the recommendation of Audit Committee. The requisite resolution for ratification of remuneration of Cost Auditors by members of the Company has been set out in the Notice of ensuing annual general meeting. The Cost Auditors have certified that their appointment is within the limits of Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified from appointment within the meaning of the said Act.

c. Secretarial Auditor:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed M/s. Aarju Agrawal & Associates, Practicing Company Secretary, Nagpur, as the Secretarial Auditors of the Company for the financial year 2019-20.

The Secretarial Audit Report submitted by Mrs. Aarju Agrawal in the prescribed form MR- 3 is attached as ‘Annexure II to this report.

Comments on Auditors statement With respect to BSEs Notice vide letter no. LIST/COMP/Reg.27(2) &Reg.17to21/Jun-19/533101/157/2019-20 dated August 19, 2019 pertaining to non compliance of composition of Board as required under Regulation 17(1) of SEBI (LODR) Regulations, 2015:- Following the resignation of Mr. Manish Kumar, a small-time delay in constituting the Board was due to proposing the right candidature of Independent Director having requisite qualification, experience and competency to assure the Boards obligation. The Compliance was made and one day fine amount as sought by BSE Limited was paid immediately and no subsequent action was taken by the Exchange in this regard.

d. Internal Auditor:

Pursuant to the provisions of Section 138 of the of the Companies Act, 2013 and the Companies (Accounts) Rules, 2014, on the recommendation of the Audit Committee, the Board of Directors of the Company has appointed Miss. Shreyata Khakole, Chartered Accountant having Membership Number: 174018 to conduct the Internal Audit of the Company as per Rule 13 of the Companies (Accounts) Rules, 2014 for the financial year 2020-2021.

During the year under review the Internal Audit Report do not contain any adverse remarks or qualification on the functions and activities of the Company.

16. REPORTING OF FRAUDS BY AUDITORS

During the year under review, the Statutory Auditors, Cost Auditors and Secretarial Auditors have not reported any instances of frauds committed by the Company by its Officers or Employees, to the Audit Committee under Section 143(12) of the Companies Act, 2013, details of which needs to be mentioned in this Report.

17. DEPOSITS

During the year under review, the Company has not accepted any deposits from the public falling within the ambit of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 (including any statutory modification(s) or re- enactment(s) thereof for the time being in force).

18. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year 2019-20 were on an arms length basis and were in the ordinary course of business. The Company had not entered into any contracts/ arrangements / transactions with related parties which could be considered material in accordance with the provisions of Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC-2 is not applicable.

All transactions with related parties were reviewed and approved by the Audit Committee and are in accordance with the Policy on dealing with and Materiality of Related Party Transactions, formulated by the Company.

For the details of the related party transactions, please refer Note No. 30 of Notes to Accounts to the financial statements.

19. PARTICULARS OF LOAN, GUARANTEE OR INVESTMENTS UNDER SECTION 186 OF COMPANIES ACT, 2013

During the year under review, the Company has not given any loans, neither provided guarantees nor made any investments covered under the provisions of section 186 of the Companies Act, 2013.

20. PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are given below:

a. The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year 2019-20 is as follows:

Name of the Director Designation Ratio of Remuneration of Director to the Median remuneration
Mr. Virender Kumar Agarwal Managing Director 30.32 times
Mrs. Seema Agarwal Joint Managing Director 24.53 times
Mr. Mayank Agarwal Whole-time Director 19.42 times

Note:

? The median remuneration of employees of the Company was 0.99 Lakhs.

? Independent Non-executive Directors receives only sitting fees, which are not considered above. ? Figures have been rounded off wherever necessary.

b. The percentage increase in remuneration of each Director, Chief Financial Officer, Company Secretary in the financial year 2019-20 as follows:

Name of the Director & KMP Designation % increase in remuneration
Mr. Virender Kumar Agarwal Managing Director Nil
Mrs. Seema Agarwal Joint Managing Director Nil
Mr. Mayank Agarwal Whole-time Director Nil
Mr. Gajanan Chhawsaria Chief Financial Officer 10.78%
Ms. Deepa Dudani Company Secretary and 20.98%
Compliance Officer

c. The percentage increase in the median remuneration of employees in the financial year: 8.21%

d. The number of permanent employees on the rolls of Company: 921

e. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

Average increase in remuneration is 10.65% for Employees other than Managerial Personnel. Increase in the managerial remuneration (MD, JMD, WTD) as compared to previous year- Nil.

f. Affirmation that the remuneration is as per the remuneration policy of the Company:

Yes, it is confirmed. The Company affirms that the remuneration is as per the remuneration policy of the Company.

Details of employee remuneration as required under provisions of Section 197(12) of the Companies Act, 2013 and Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms an integral part of this annual report. The above Annexure is not being sent alongwith this annual report to the members of the Company in line with the provisions of the Act. Members who are interested in obtaining these particulars may write to the Company Secretary at cssuryaamba@gmail.com.

21. HUMAN RESOURCES

Suryaamba considers human resources to be its most valuable asset and continues to put due emphasis on appropriate human resource development for its business. Your Company constantly endeavour to invest in people and processes to improve human capital for the organization and service delivery to its customers.

The employees of your Company fully identify with the Companys vision and business goals. Your Company strives to provide a healthy, conducive and competitive work environment to enable the employees excel and create new benchmarks of productivity, efficiency and customer delight.

Suryaamba always believes in maintaining mutually beneficial industrial relations and hence the industrial relations have always been smooth, cordial and trusting.

22. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Energy conservation continues to be an area of major emphasis in our Company. Efforts are made to optimize the energy cost while carrying out the manufacturing operations. Pursuant to Section 134(3)(m) of the Companies Act, 2013 read with the Rule 8 of Companies (Accounts) Rules, 2014, the information on conservation of energy, technology absorption and foreign exchange earnings and outgo are stipulated below:

a. Conservation of energy:

Energy Conservation is an ongoing process in the Company. The thrust is to measure the existing system parameters and then implement improvements. Emphasis is also given to optimize the operation of various equipments which also lead to energy conservation. The Company makes continuous efforts on monitoring and effective control on utilization of energy consumption and takes immediate steps to curtail power consumption. Machine maintenance, energy efficient equipments, replacement of energy consuming equipments is thoroughly carried out.

The company looks to explore the possibility of solar power as a green energy. There was no major capital investment on energy conservation equipments during the year.

b. Technology absorption:

The Company is continuously making efforts for adaptation of latest technology at its unit to improve the performance, quality and cost effectiveness of its products, upgrading its plant and Machinery. The Company focuses to pioneer the launch of new products that have been successful in the market to adapt at its unit.

The Company has been continuously improving the quality of its existing products and entered into new products and also to reduce the cost of production and optimum energy utilization.

The Company has not imported any technology during the last three years reckoned from the beginning of this financial year 2019-20. Therefore, no such disclosure on details of technology imported, year of import and absorption of technology are applicable.

During the year the company has not made any expenditure on research & development.

c. Foreign exchange earnings and outgo:

Total Foreign Exchange used and earned in terms of actual inflows and actual outflow:

(in lakhs)
Particulars 2019-20 2018-19
(i) Earnings (FOB value of Exports, commission earned) 1935.13 1957.15
(ii) Outgo (CIF value of Imports and expenditure in foreign currency) 393.03 41.72

23. RISK MANAGEMENT

Risk Management is a basic key to ensure sustained profitability and stability and also forms an integral and important component of Corporate Governance. The Company has the Risk Management Policy in place which identifies elements of risk, if any, which in the opinion of the Board may threaten the existence of the Company. The objective of the Policy is to develop a ‘risk intelligent culture which drives informed decision making and builds resilience to adverse developments while ensuring that opportunities are exploited to create value for all stakeholders.

The Board / Management puts in place adequate and effective system and resources for the purposes of risk management. The Board periodically reviews the risks and suggests steps to be taken to control and mitigate the same through a properly defined framework. Suryaamba believes that a robust risk management system ensures adequate control and monitoring mechanism for a smooth and efficient running of the business. A risk-aware organization is better equipped to maximize the shareholders value. The Companys future growth is linked to general economic conditions prevailing in the market.

The details of the Financial Risk Management, its objectives and policies are set out in Note 29C to the Financial Statements of the Company.

24. INTERNAL FINANCIAL CONTROLS

The Companys internal control systems are supplemented by an extensive internal audit program conducted by an independent professional agency. The internal control system is designed and exercised to ensure that all financial and other records are reliable for preparing financial statements, maintaining accountability of assets and in compliance with various policies, practices and statutes, and that all assets are safeguarded and protected against loss from unauthorised use or disposition and that those transactions are authorised, recorded and reported correctly.

The Company has sound internal financial controls commensurate to the size and nature of its business. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board for their review and during the year no material weaknesses in controls were observed.

25. SIGNIFICANT OR MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

Pursuant to the requirement of Section 134(3)(q) of the Companies Act, 2013 read with Rule 8(5)(vii) of the Companies (Accounts) Rules,2014, it is confirmed that during FY 2019-20 there were no significant or material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and your Companys operations in future.

26. POLICY ON SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

Your Directors stated that the Company follows an Anti- Sexual Harassment Policy in line with the requirements of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 also an internal complaints committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary and trainees) are covered under this policy. No complaints pertaining to sexual harassment were received during FY 2019-20.

27. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Pursuant to the provisions of Section 135 of the Companies Act, 2013 read with rules made there under, for the year ended March 31, 2020, the Company is not covered under the purview of criteria for CSR eligibility.

Whereas considering the financial statements for financial year ended March 31, 2020, the Company for the financial year 2020-2021 falls within the ambit of eligibility criteria for CSR. In compliance with applicable provisions, the Board at its meeting held on June 29, 2020 constituted a Corporate Social Responsibility (CSR) Committee comprising members mentioned at point no. 11 of this report. The Committees prime responsibility is to assist the Board in discharging its social responsibilities by way of formulating and monitoring implementation of the objective of ‘Corporate Social Responsibility Policy.

Corporate Social Responsibility is the commitment of business to contribute for sustainable economic development. It is the contribution of the corporate sector for philanthropic causes like education, health, water, environment and community welfare, etc. The core theme of the Companys CSR policy is giving back to the society from which it draws its resources by extending helping hand to the needy and the underprivileged.

28. MANAGEMENT DISCUSSION AND ANALYSIS AND CORPORATEGOVERNANCE REPORT

The Management Discussion and Analysis Report and the Report on Corporate Governance, as required under the Listing Regulations, forms part of the Annual Report.

29. OTHER DISCLOSURES

a. The Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2).

b. Investor Education and Protection Fund (IEPF): Pursuant to the provisions of Section 124 and 125 of the Companies Act, 2013, read with rules made there under, the details / due dates for transfer of unclaimed / unpaid dividend to the Investors Education & Protection Fund (IEPF) by the Company are given in General Shareholders Information Section of Corporate Governance Report, forming part of this Annual Report.

The details of unclaimed dividend / shares are available on the website of the Company viz. www.suryaamba.com/investors.

c. During the year under review, India Ratings & Research have affirmed the Company Credit Rating lND BBB, specified in detail in the Corporate Governance Report.

d. The Company neither has any subsidiary, joint venture nor any associate company.

e. The Company does not have any scheme or provision of money for the purchase of its own shares by employees/ Directors or by trustees for the benefit of employees/ Directors; and

f. During the year under review, the Company has not issued equity shares with differential rights as to dividend, voting or otherwise.

APPRECIATION & ACKNOWLEDGMENT

The Board of Directors place on record sincere gratitude and appreciation for all the employees at all levels for their hard work, solidarity, cooperation and dedication during the year. The hard work and unstinting efforts of the employees have enabled the Company to sustain and further consolidate its position in the industry.

They also take this opportunity to express their deep appreciation for sincere assistance and co-operation received from its customers, shareholders, suppliers as well as vendors, bankers, business associates, regulatory and government authorities for their continued support. It will be the Companys endeavour to build and nurture these strong links with its stakeholders.

Your Directors regret the loss due to COVID-19 pandemic and hope for your good health and safety and are deeply grateful and have immense respect for every person who risked their life and safety to fight this pandemic.

Place:

Nagpur

Virender Kumar Agarwal By Order of the Board of Directors
Date : June 29, 2020 Managing Director Seema Agarwal
DIN : 00013314 Joint Managing Director
DIN : 01430206

FORM NO. MGT 9

EXTRACT OF ANNUAL RETURN

AS ON THE FINANCIAL YEAR ENDED MARCH 31, 2020

(Pursuant to Section 92 (3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014)

I. REGISTRATION AND OTHER DETAILS:

1. CIN L18100TG2007PLC053831
2. Registration Date 05-May-2007
3. Name of the Company Suryaamba Spinning Mills Limited
4. Category/Sub category of the Company Public Company/Limited by Shares
Indian Non-Government Company
5. Address of the Registered office & contact details 1st Floor, Surya Towers, 105, SP Road,
Secunderabad, Telangana, 500003.
Tel. No. 040-27813360
Email: samba.ngp@gmail.com
Website: www.suryaamba.com
6. Whether listed company Yes
7. Name, Address & contact details of the Registrar & Transfer Agent, if any. KFin Technologies Private Limited
(Formerly known as "Karvy Fintech Private Limited")
Karvy Selenium Tower B, Plot No.31 & 32,Financial
District, Gachibowli, Nanakaramguda, Serilingampally,
Hyderabad- 500 032, Telangana.
Ph. No. 040-6716 2222, 3321 1000
E-mail: einward.ris@kfintech.com /
kfinkart.support@kfintech.com / reachus@kfintech.com
Website: https://www.kfintech.com

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

(All the business activities contributing 10% or more of the total turnover of the company shall be stated)

S. No. Name and Description of main products / services NIC Code of the Product/service % to total turnover of the company
1. Preparation and Spinning of Synthetic Yarn 13114 99.423%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

The Company does not have any subsidiary, joint venture or associate companies.

IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

A) Category-wise Share Holding:

Category of Shareholders

No. of Shares held at the beginning of the year [As on 01-Apr-2019]

No. of Shares held at the end of the year [As on 31-March-2020]

Demat Physical Total % of total Shares Demat Physical Total % of total Shares % Change during the year
A. PROMOTERS
(1) Indian
Individual/ HUF 2163327 100 2163427 73.79 2176866 100 2176966 74.25 0.46
Central Govt. - - - - - - - - -
State Govt.(s) - - - - - - - - -
Bodies Corp. - - - - - - - - -
Banks / FI - - - - - - - - -
Any other - - - - - - - - -
Sub-Total (A)(1) 2163327 100 2163427 73.79 2176866 100 2176966 74.25 0.46
(2) Foreign
NRI Individuals - - - - - - - - -
Other-Individuals - - - - - - - - -
Bodies Corporate - - - - - - - - -
Banks/FI - - - - - - - - -
Any other - - - - - - - - -
Sub-Total (A)(2) - - - - - - - - -
Total holding of 2163327 100 2163427 73.79 2176866 100 2176966 74.25 0.46
Promoters(A)=
(A)(1)+(A)(2)
B. PUBLIC SHAREHOLDING
1. Institutions
Mutual Funds 64 0 64 0.00 64 0 64 0.00 -
Banks / FI 210 660 870 0.03 210 600 810 0.03 -
Central Govt. - - - - - - - - -
State Govt.(s) - - - - - - - - -
Venture Capital - - - - - - - - -
Funds
Insurance Companies - - - - - - - - -
FIIs - - - - - - - - -
Foreign Venture - - - - - - - - -
Capital Funds
Others (specify) - - - - - - - - -
Sub-total (B)(1):- 274 660 934 0.03 274 600 874 0.03 -
2. Non-Institutions
Bodies Corp.
i) Indian 18522 1273 19795 0.68 10481 268 10749 0.37 (0.31)
ii) Overseas - - - - - - - - -
iii) Individuals
Holding nominal share capital up to 1 lakh 474449 54377 528826 18.04 459824 30391 490215 16.72 (1.32)
Holding nominal share capital in excess of 1 lakh 202674 0 202674 6.91 211039 0 211039 7.20 0.29
Others:
NBFCs registered with RBI 4000 0 4000 0.14 0 0 0 0 (0.14)
Non Resident Indians 8557 0 8557 0.29 12894 0 12894 0.44 0.15
Clearing Members 3000 0 3000 0.10 1500 0 1500 0.05 (0.05)
Individual NRI- Rep.- Non Repatriable 731 0 731 0.02 2611 0 2611 0.09 0.06
I E P F 0 0 0 0 25096 0 25096 0.86 0.86
Sub-total (B)(2):- 711933 55650 767583 26.18 723445 30659 754104 25.72 (0.46)
Total Public shareholding 712207 56310 768517 26.21 723719 31259 754978 25.75 (0.46)
(B)=(B)(1)+ (B)(2)
C. Shares held by Custodian for GDRs & ADRs - - - - - - - - -
Grand Total (A+B+C) 2875534 56410 2931944 100.00 2900585 31359 2931944 100.00 -

B) Shareholding of Promoters:

Sr. No. Shareholders Name

Shareholding at the beginning of the year

Shareholding at the end of the year

No. of Shares % of total shares of the Company % of Shares Pledged/ encumbered to total share No. of Shares % of total shares of the Company % of Shares Pledged/ encumbered to total share % change during the year
1. Virender Kumar Agarwal 1206191 41.14 16.98 1206191 41.14 16.98 -
2. Seema Agarwal 642250 21.91 - 642250 21.91 - -
3. Mayank Agarwal 270997 9.24 - 270997 9.24 - -
4. Pujit Agarwal 28251 0.96 - 41790 1.43 - 0.46
5. Virender Kumar Agarwal 14640 0.50 - 14640 0.50 - -
HUF
6. Vithaldas Agarwal 998 0.03 - 998 0.03 - -
7. Ravinder Kumar Agarwal 100 0.00 - 100 0.00 - -
TOTAL 2163427 73.79 - 2176966 74.25 - 0.46

C) Change in Promoterss Shareholding: (please specify, if there is no change)

S N Shareholders Name

Shareholding at the beginning & end of the year

Cumulative Shareholding during the year

No. of Shares % of total Shares of the Company Date wise increase/ decrease in the shareholding No. of Shares increase/ decrease Reason for increase/ decrease in the shareholding No. of Shares % of total Shares of the Company
1.1 1. Pujit Agarwal
As on 01-04-2019 28251 0.96 06.06.2019 1290 Purchase 29541 1.01
19.09.2019 3100 Purchase 32641 1.11
27.09.2019 2208 Purchase 34849 1.19
10.12.2019 55 Purchase 34904 1.19
11.12.2019 261 Purchase 35165 1.20
17.12.2019 95 Purchase 35260 1.20
19.12.2019 707 Purchase 35967 1.23
18.02.2020 1573 Purchase 37540 1.28
25.02.2020 159 Purchase 37699 1.29
26.02.2020 70 Purchase 37769 1.29
02.03.2020 557 Purchase 38326 1.31
03.03.2020 500 Purchase 38826 1.32
04.03.2020 271 Purchase 39097 1.33
06.03.2020 1300 Purchase 40397 1.38
09.03.2020 800 Purchase 41197 1.41
11.03.2020 593 Purchase 41790 1.43
As on 31-03-2020 41790 1.43

D) Shareholding Pattern of top ten Shareholders (Other than Directors, Promoters and Holders of GDRs and ADRs):-

S N Shareholders Name

Shareholding at the beginning & end of the year

Cumulative Shareholding during the year

No. of Shares % of total Shares of the Company Date wise increase/ decrease in the shareholding No. of Shares increase/ decrease Reason for increase/ decrease in the shareholding No. of Shares % of total Shares of the Company
1. Sangeetha S 0 0.00 08.11.2019 50380 Transfer 50380 1.72
As at end of the year 31-03-2020 50380 1.72
2. Gautam M Mehta(HUF) 33000 1.13 23.08.2019 826 Sale 32174 1.09
30.08.2019 1174 Sale 31000 1.05
06.09.2019 501 Sale 30499 1.04
20.09.2019 499 Sale 30000 1.02
As at end of the year 31-03-2020 30000 1.02
3. Satya Prakash Mittal 23559 0.80 - - - 23559 0.80
4. Anil Kumar 21000 0.72 - - - 21000 0.72
5. Vinodchandra M. Parekh 17396 0.59 - - - 17396 0.59
6. Bhavsar Usha 12600 0.43 07.06.2019 1000 Purchase 13600 0.46
As at end of the year 31-03-2020 13600 0.46
7. Shaunak Jagdish Shah 12389 0.42 - - - 12389 0.42
8. Atul Arya 0 0.00 05.04.2019 470 Purchase 470 0.02
19.04.2019 290 Purchase 760 0.03
14.06.2019 5000 Purchase 5760 0.20
14.02.2020 500 Purchase 6260 0.21
13.03.2020 4617 Purchase 10877 0.37
31.03.2020 182 Purchase 11059 0.38
As at end of the year 31-03-2020 11059 0.38
9. Avinash Gupta 11000 0.38 - - - 11000 0.38
10. Mahendra Girdharilal 162 0.01 10.05.2019 1600 Purchase 1762 0.06
17.05.2019 3079 Purchase 4841 0.17
24.05.2019 615 Purchase 5456 0.19
31.05.2019 2400 Purchase 7856 0.27
10.01.2020 1500 Purchase 9356 0.32
17.01.2020 100 Purchase 9456 0.32
31.03.2020 1000 Purchase 10456 0.36
As at end of the year 31-03-2020 10456 0.36

E) Shareholding of Directors and Key Managerial Personnel:

None of the other Directors or KMP, except as given below holds any shares of the Company.

Sr. No. Name of the Directors No. of Shares at the beginning of the year % of total shares of the Company No. of Shares at the end of the year % of total shares of the Company
1. Virender Kumar Agarwal 1206191 41.14 1206191 41.14
2. Seema Agarwal 642250 21.91 642250 21.91
3. Mayank Agarwal 270997 9.24 270997 9.24

V. INDEBTEDNESS

Indebtedness of the Company including interest outstanding /accrued but not due for payment.

(in lakhs)

Particulars Secured Loans (excluding deposits) Unsecured Loans Deposit Total Indebtedness
At the beginning of the financial Year
(i) Principal Amount 2982.07 502.38 - 3484.46
(ii) Interest due but not paid 14.32 10.22 - 24.54
(iii) Interest accrued but not due - - - -
TOTAL(i+ii+iii) 2996.39 512.60 - 3509.00
Change during the financial Year
Addition 533.13 932.07 - 1,465.20
Reduction 873.26 142.44 - 1015.70
Net Change (340.13) 789.63 - 449.50
At the end of the financial Year
(i) Principal Amount 2634.83 1295.38 - 3930.21
(ii) Interest due but not paid 21.43 6.85 - 28.28
(iii) Interest accrued but not due - - - -
TOTAL (i+ii+iii) 2656.26 1302.23 - 3,958.49

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to Managing Director, Whole-time Directors and/or Manager:

(in lakhs)
Sr. No. Particulars of Remuneration Name of MD/WTD/Manager
Mr. Virender Kumar Agarwal Mrs. Seema Agarwal Mr. Mayank Agarwal Total Amount
1. Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income Tax Act, 1961. 16.80 14.40 11.40 42.60
(b) Value of Perquisites u/s 17(2) Income Tax Act, 1961. 11.20 8.16 6.46 25.82
(c) Profits in lieu of salary under Section 17(3) Income Tax Act, 1961. - - - -
2. Stock Option - - - -
3. Sweat Equity - - - -
4. Commission - - - -
- as % of profit
- others - - - -
5. Others, please specify - - - -
Contribution to Provident Fund 2.02 1.73 1.37 5.12
6. Total Amount 30.02 24.29 19.23 73.54
Ceiling as per the Act 84 lakhs (Pursuant to Section II of Part II of Schedule V of the Act.)

B. Remuneration to other Directors:

(in lakhs)
Sr. No. Particulars of Remuneration Name of Directors Total Amount
Independent Non-executive Directors
Mr. Amit Goela Mr. Sushil Kapadia Mr. Nilesh Panpaliya
1. Fee for attending Board/ Committee Meetings 0.15 0.15 0.05 0.35
2. Commission - - - -
3. Total Amount 0.15 0.15 0.05 0.35
Ceiling as per the Act One lakh per meeting of the Board or committee thereof.

The above excludes conveyance and out of pocket expenses.

C. Remuneration to Key Managerial Personnel other than MD/MANAGER/WTD:

(in lakhs)
Sr. No. Particulars of Remuneration

Name of KMP

Total Amount
Mr. Gajanan Chhawsaria Chief Financial Officer Ms. Deepa Dudani Company Secretary
1. Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income Tax Act, 1961. 9.60 1.99 11.59
(b) Value of Perquisites u/s 17(2) Income Tax Act, 1961. 4.76 1.21 5.97
(c) Profits in lieu of salary under Section 17(3) Income Tax Act, 1961. - - -
2. Stock Option - - -
3. Sweat Equity - - -
4. Commission - - -
- as % of profit
- others - - -
5. Others, please specify - - -
Contribution to Provident Fund 1.16 0.26 1.42
6. Total Amount 15.52 3.46 18.98

VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES

There were no penalties / punishment / compounding of offences for breach of any section of Companies Act, 2013 against the Company or its Directors or other Officers in default, if any, during the year.

Place:

Nagpur

By Order of the Board of Directors Seema Agarwal
Date : June 29, 2020 Virender Kumar Agarwal Joint Managing Director
Managing Director DIN : 01430206
DIN : 00013314