Uniply Industries Ltd Directors Report.

To All members,

Your Directors are pleased to present the report of the business and operations of your company along with the Audited Financial Statements for the year ended March 31, 2020. The consolidated performance of the Company and its Subsidiary has been referred to wherever required.

RESULTS OF OUR OPERATIONS AND STATE OF AFFAIRS

Rs. in Lakhs except to per share data

Particulars

Consolidated

Standalone

31.03.2020 31.03.2019 31.03.2020 31.03.2019
Revenue from Operations 30149.28 46857.54 22822.22 17193.18
Other Income 3502.87 3622.79 4116.32 345.545
Total Income 33652.14 50480.33 26938.54 20648.63
Operating Profit 1502.95 9984.48 1492.74 3890.42
Profit before Exceptional items and Taxation -2779.96 5587.02 -315.01 2723.18
Exceptional item -505.00 332.82 -505.00 -2.01
Taxation -604.93 -1969.44 28.47 -890.01
Profit after Tax -2843.30 3950.40 -848.48 1831.16
Total Comprehensive Income for the year -2842.53 3943.01 -848.48 1836.14
Earnings per share
- Basic (in Rs.) -1.71 2.60 -0.51 1.21
- Diluted (in Rs.) -1.70 2.12 -0.51 0.99

Note: The above figures are extracted from the audited Standalone and Consolidated financial statements prepared as per Indian Accounting Standard (Ind AS).

PERFORMANCE OVERVIEW

During the fiscal year ended 31st March 2020, consolidated gross revenue decline by 33%. Consolidated Profit after tax attributable to owners is Rs (28.00) Crores for the year 2020 compared to Profit of Rs 39.00 Crores for the previous year. The decrease in revenue and reporting of loss is mainly due to negligible operation during 2nd half of the year.

TRANSFER TO RESEVE:

No profit has been transferred to General Reserve.

SUBSIDIARIES & ASSOCIATES

As on March 31, 2020 your Company has a wholly Owned Subsidiary viz. Vector Projects India Pvt Ltd and M/s. Uniply Decor Ltd is an associate company

The detail with respect to Subsidiaries and Associate is slated in Form AOC-1 in Annexure - A.

STATE OF THE COMPANYS AFFAIRS

The state of the Company affairs forms an integral part of Management Discussion & Analysis Report.

RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on an 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.

The policy on Related Party Transactions as approved by the Board is uploaded on the Companys website. The Web link for the same is http: //www.uniply.in/pdf- excel/RELATED PARTY TRANSACTIONS POLICY.pdf.

The detail with respect to Related Party Transactions is slated in form AOC-2 in Annexure - B.

CONSOLIDATED FINANCIAL STATEMENTS

As per the prescribed provisions of the Companies Act, 2013, Rule thereon and Accounting Standard the Consolidated Financial Statements of the Company prepared forms part of this Annual Report.

DIRECTORS RESPONSIBILITY STATEMENT

In compliance with section 134(3) (c) of the Companies Act, 2013, your Directors confirm:

a. That in the preparation of Annual Accounts, the applicable accounting standards have been followed and that no material departures have been made from the same.

b. That they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and the profit or loss of the company for that period.

c. That they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of your company and for preventing and detecting fraud and other irregularities;

d. That they have prepared the annual accounts on a going concern basis.

e. That proper internal financial control is in place, that the financial controls were adequate and were operating effectively, that systems to ensure compliance with the provisions of all applicable laws.

f. Proper systems to ensure compliance with the provisions of all applicable laws were in place and there adequate and operating efficiently.

SHARE CAPITAL & CONVERTIBLE SHARE WARRANTS

The authorized share capital and paid up Share Capital as on 31.03.2020 is Rs. 65,00,00,000/- (32,50,00,000 Equity shares of Rs. 2/- each) & 33,52,94,800/- (16,76,47,400 Equity shares of Rs. 2/- each) respectively.

During the financial year 4,86,796 (162265 on 06.09.2020 + 324531 on 18.09.2020) number of warrants of Rs. 10/- each got converted into 2433980 (8,11,325 shares on 06.09.2019 + 1622655 shares on 18.09.2020) equity shares of Rs. 2/- each. Balance share warrants were also split into 5 each consequent to the split in equity face value from Rs.10/- to Rs.2/- each. The final date of conversion of warrant was 24.10.2020. Balance 4521341 warrants were not converted on/before the due date. The Company has also made an application to SEBI requesting to extend the conversion period but SEBI couldnt grant the request. Accordingly, all non-converted warrants were extinguished and the call money of 25% paid by the investors against the same is forfeited and booked as capital redemption reserve in the Companys book.

OUTLOOK, EXPANSION AND STRATEGIC DEVELOPMENT

The operations of the Company during the year has largely remained subdued in line with the economic slowdown and the overall plan of the company for internal restructuring.

CORPORATE SOCIAL RESPONSIBILITY

Corporate Social Responsibility, encompassing much more than social outreach, continuous to be an integral part of the companys activity. The detailed CSR report is annexed as per Annexure C.

STATUTORY AUDITORS & THEIR REPORT

M/s. N.D. Kapur & Co., Chartered Accountants is the Statutory Auditor of the Company.

The Auditors Report to the Shareholder contains reservation, Qualification or adverse remark.

Boards response on Auditors qualification, reservation or adverse remark made:

Qualified opinion on standalone and consolidated Report:

a) the company has not been regular in depositing undisputed statutory dues including provident fund, employees state insurance, income-tax, sales-tax, service tax, goods and services tax, duty of customs, duty of excise, value added tax, cess and other statutory dues, wherever applicable, with the appropriate authorities. According to the information and explanations given to us, there were approx. Rs. 26,92,61,639/- payable in respect of aforesaid dues which are in arrears, as at 31st March 2020 for a period of more than 6 months from the date they became payable.

Managements response - the Statutory dues such as PF, ESI, Professional Tax and GST are all paid during November 2020 except Income Tax /TDS and some amount of GST which are unpaid till date of this audit.

Other remarks and observation of the Auditor in their report and annexure and management responses, if any, are self-explanatory.

COST AUDIT/MAINTENANCE OF COST RECORDS

The company was not falling under criteria given for maintenance of Cost Record/Cost Audit as per the Companies (Cost Records and Audit) Rules, 2014. Hence cost audit/Maintenance of cost record was not conducted.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of (Managerial Personnel) Rules, 2014, the Company has appointed M/s. P.K Panda & Co., Practicing Company Secretaries, Chennai to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed herewith as "Annexure D".

Directors response to the Audit remark/observation/Qualification:

i) During the year under review, company has not published its financial results for the quarter ended 31st December, 2019 and 31st March, 2020 for which notices have been received from exchanges.

Director Response: COVID 19 pandemic has resulted in delays in publication of financial results. However, the compliances have been completed now.

ii. 24,33,980 no of equity shares of Rs. 2/- each (8,11,325 shares allotted on 06.09.2019 & 16,22,655 shares allotted on 18.09.2019) pursuant to conversion of warrants for which shares are yet to be listed.

Director Response: The Company had applied for listing of shares with both NSE and BSE. NSE has already approved the application but is pending with BSE. The Company is in the process of getting the shares listed and hopefully the same shall be complied with during 1st quarter of year 2020-21.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is defined by the Audit Committee and delegated to Internal Auditor to maintain its objectivity and independence. The Internal Auditor reports to the Chairman of the Audit Committee of the Board and to the Chairman & Managing Director.

The Internal Auditor M/s. Karikalan & Co., Chartered Accountants monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company and promptly informed the management on the lacking as and when required.

PUBLIC DEPOSITS

During the period under review, the Company did not invite or accept any deposits from the public in terms of Chapter V of the Companies Act, 2013.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

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

DIRECTORS, KMP & CHANGES THEREON

Mr. Nazeer Azam Sulthan was appointed as Managing Director of the Company w.e.f.

16.09.2019 and has never reported to work. Mr. Keshav Narayan Kantamneni has been appointed as Managing Director w.e.f. 07.11.2019. Mr. Srinivasan Sethuraman, Managing Director & Mr. B V M Sarma, Joint Managing Director resigned w.e.f. 14.08.2019. Further, Mr. Umesh P Rao resigned from the post of Joint Managing Director w.e.f. 07.11.2019. There are no other changes in Directors & KMP.

MEETING OF THE BOARD

During the year under review Six (6) Board Meetings were held. The details of the Board Meetings with regard to their dates and attendance of each of the Directors thereat have been provided in the Corporate Governance Report.

MEETING OF THE COMMITTEE

The Board has various Committees such as Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee and Risk Management Committee and CSR Committee. The details of each committee and their respective meetings have been provided in the Corporate Governance Report.

MEETINGS OF INDEPENDENT DIRECTORS

In terms of Schedule IV of the Companies Act, 2013 and the Listing Regulations, a separate meeting of the Independent Directors of the Company was held on February 28, 2020 without the presence of Executive Directors and members of the management wherein they inter alia discussed:

• the performance of the Chairperson of the Company, taking into account the views of Executive Directors and Non-Executive Directors; and

• the performance of Non-Independent Directors and the Board as a whole;

• the quality, quantity and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

BOARD EVALUATION

Pursuant to the provisions of The Companies Act, 2013 and the SEBI (LODR) 2015, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and other Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

NOMINATION & REMUNERATION POLICY

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Nomination & Remuneration Policy is stated in Annexure-E.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The company has framed Familiarization Programme for Independent Directors pursuant to SEBI (LODR) 2015 and uploaded the same in the website of the Company. The web link to access the aforesaid programme is http://www.uniply.in/ pdfexcel/INDEPEDENT_ DIRECTORS_FAMILARISATION_PROGRAMME.pdf.

MEETINGS

A calendar of Meetings is prepared and circulated in advance to the Directors. During the year under review Six Board Meetings, four Audit Committee Meetings and other Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gaps between the Meetings were within the period prescribed under the Companies Act, 2013.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as per Annexure - F.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has a vigil mechanism/Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. The details of the vigil mechanism/Whistle Blower Policy is posted on the website of the Company and available in this web link: http: //www.uniply.in/pdf-excel/WHISTLE_BLOWER_POLICY.pdf

EXTRACT OF ANNUAL RETURN

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

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, 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