VRL Logistics Ltd Directors Report.

DIRECTORS’ REPORT

Dear Members,

Your directors are pleased to present the thirty fifth annual report of your Company together with the audited financial statements for the financial year ended March 31, 2018

SUMMARY OF FINANCIAL RESULTS ( Rs. in lakhs)
Particulars Year Ended Year Ended
31st March, 2018 31st March, 2017
Total Income 1,93,655.07 1,81,238.33
Profit before Finance cost and Depreciation 24,846.44 22,748.13
Finance Costs 1,144.09 2,400.21
Depreciation & Amortization expense 9,763.42 9,817.85
Profit Before Tax 13,938.93 10,530.07
Tax Expense 4,682.51 3,482.81
Net Profit After Tax 9,256.42 7,047.26
Other comprehensive income (186.01) 75.98
Total Comprehensive income 9070.41 7123.24
Basic& diluted Earning per Share (Rs.) 10.17 7.72

OPERATING HIGHLIGHTS / STATE OF COMPANY’S AFFAIRS

During the year under consideration, your Company had gross revenues of Rs. 1,93.655.07 lakhs as against Rs. 1,81,238.33 lakhs in previous year depicting a growth of 6.85% resulting in Profit before tax (PBT) of Rs. 13,938.93 lakhs as against the Profit before tax of Rs. 10,530.07 lakhs in the previous year depicting a growth rate of 32.37%. While the Company’s Goods Transport Division achieved a turnover of Rs. 1,51,722.15 lakhs registering a growth rate of 6.39% as compared to the previous year, Bus Operations division achieved a turnover of 35,870.88 lakhs registering a growth rate of 9.96%. A detailed financial performance analysis is provided in the Management Discussion & Analysis Report, which is part of this Annual Report.

SHARE CAPITAL

During the year under consideration, the paid up Capital has decreased from Rs. 9124.35 Lakhs to Rs. 9034.35 Lakhs due to buy-back of 9,00,000 Equity shares of Rs. 10 each (fully paidup) at an average price of Rs. 419.39/- per share from non-promoter shareholders.

The company has not issued shares with differential voting rights nor has granted any stock options or sweat equity. As on March 31, 2018, none of the Directors of the company hold instruments convertible into equity shares of the Company.

BUYBACK OF SHARES

The Board of Directors of the Company at their meeting held on November 3, 2017 approved the buyback of its fully paid up Equity Shares for an aggregate amount not exceeding Rs. 4,140 Lakhs, ("Maximum Buy-back Size"), being 7.65% of the total paid up share capital and free reserves of the Company based on the audited financial statements of the Company as at March 31, 2017 (being the date of last audited financial statements of the Company), for a price not exceeding Rs. 460/- per Equity Share ("Maximum Buy-back Price") from the shareholders of the Company excluding promoters, promoter group, persons acting in concert and persons who are in control of the Company, payable in cash via the open market route through the stock exchanges, in accordance with the Securities and Exchange Board of India (Buy Back of Securities) Regulations, 1998, as amended ("SEBI Buyback Regulations") and the Companies Act, 2013 and rules made thereunder, as amended (the process hereinafter referred to as the "Buy-back").

The Company completed the Buyback of 9,00,000 equity shares at an average price of Rs. 419.39/- per share on January 30, 2018. The outlay on account of buy-back was Rs. 3774.60/- Lakhs, which represented 91.17% of the amount earmarked for Maximum Buyback Size.

Accordingly, the Company also extinguished all 9,00,000 equity shares bought back within the stipulated timeframe under the governing regulations and also filed with Securities and Exchange Board of India (SEBI) and Stock Exchanges, a report of auditors confirming the extinguishment of shares as required under the extant provisions of the governing laws.

The details of the pre and post Buyback shareholding pattern of the Company are as follows:

Category of Shareholder Pre Buy-back Post Buy-back
Number of Shares % to the existing Equity Share capital Number of Shares % to post Buy- back Equity Share capital
Promoters and promoter group 6,14,80,000 67.38 6,14,80,000 68.05
Foreign Investors (Including Non-Resident Indians, 1,06,85,863 11.71
FIIs,FPIs,Foreign Mutual Funds,Foreign Nationals)
Financial Institutions/Banks, Mutual Funds promoted by Banks/ Institutions 1,05,95,633 11.62 2,88,63,495 31.95
Others (Public, Bodies Corporate, etc.) 84,81,999 9.30
Total 9,12,43,495 100 9,03,43,495 100

CHANGE IN THE NATURE OF BUSINESS

There is no change in nature of business of the Company. Your Company continues to be one of the leading Logistics service providers in the country. The service offering of the Company in the Logistics space are Goods transport, Passenger transport and Courier services apart from transport of passenger by Air and Wind Power Generation business. However, the company has passed necessary resulation for amendment of objects clause to facilitate undertaking allied business activities as mentioned herein after.

AMENDMENT TO THE MAIN OBJECTS OF MEMORANDUM OF ASSOCIATION

Your Board had approved the amendments to objects clause of Memorandum of Association of the Company, to facilitate the Company encash opportunities coming its way, at its Board meeting held on December 2, 2017 which was subject to approval of shareholders by special resolution. Amendment of main objects inter alia include the following: - Distribution / dealership / transacting of vehicle spares and components and other products; - Designing / Manufacturing truck / bus and other vehicle bodies and other works; and - Providing logistics business solutions.

Shareholders have approved the said amendment by special resolution by postal ballot and details of voting pattern are provided in the Corporate Governance report which forms part of this Annual Report.

The company has also received approval from the Regestrar of Compnies for the amendment of objects clause.

CAPITAL EXPENDITURE:

During the Financial year 2017-18, the company has incurred a capital expenditure of Rs. 4733.65 lakhs. Out of the same, an amount of Rs. 1759.11 lakhs was invested on fleet addition and comprised of 50 long route Ashok Leyland vehicles as also other smaller vehicles for short haul apart from cars. Other capex components includethe cost incurred on additions to Buildings, Plant & Equipment, Office Equipment, Leasehold Improvements and Furniture & Fittings. Apart from the same the Company has also extended substantial advances for purchase of properties at Mangaluru and Surat.

DIVIDEND:

During the Financial year 2017-18, no dividend was declared. The Board does not recommend any dividend for the year. In compliance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirement) Regulations, 2015 ("SEBI Listing Regulations"), the Dividend policy of the Company is available on the Company’s website at http:// vrlgroup.in/vrl_investor_desk.aspx?display=policies. A copy of the same is annexed to this Report as Annexure A.

TRANSFER OF UNPAID AND UNCLAIMED AMOUNT TO IEPF:

The Ministry of Corporate Affairs under Section 124 and 125 of the Companies Act, 2013 requires dividends that are not encashed/claimed by the shareholders for a period of seven consecutive years, to be transferred to the Investor Education and Protection Fund (IEPF). During the year under consideration, no amount was due for transfer to IEPF in accordance with Section 125 of the Companies Act, 2013.

The details of unclaimed dividend and IPO share application money alongwith their due dates for transfer to IEPF is provided in the Corporate Governance Report which forms part of this Annual Report.

TRANSFER TO RESERVES:

The Company has transferred an amount of Rs. 925.64 lakhs to the General Reserve out of current year’s profits in line with earlier years.

SUBSIDIARY COMPANIES:

The Company does not have any subsidiary.

FIXED DEPOSITS

The Company has not accepted any deposits during the year within the meaning of Section 73 of the Companies Act,2013 and the rules made thereunder.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

The company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013.

Details of investments made by the company are given in the notes to the financial statements.

CREDIT RATING

ICRA Limited has upgraded the Long term rating of the Company from [ICRA] A- (pronounced as ICRA A Minus) to [ICRA] A (pronounced as ICRA A). The outlook on the long term rating has been revised from Stable to Positive.

MANAGEMENT’S DISCUSSION AND ANALYSIS REPORT

Management’s Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 of SEBI Listing Regulations read with Schedule V thereto, is presented in a separate section forming part of this Annual Report.

BUSINESS RESPONSIBILITY REPORT

Securities Exchange Board of India vide its notification no. SEBI/LAD-NRO/GN/2015-16/27 dated December 22, 2015 has amended the SEBI Listing Regulations whereby mandating top five hundred listed companies to include a report on business responsibility. The said report forms part of this Annual Report.

CORPORATE GOVERNANCE

The Company is committed to maintain the steady standards of corporate governance and adhere to the corporate governance requirements set out under extant law. The Report on corporate governance as stipulated under Regulation 34 of the SEBI Listing Regulations read with Schedule V thereto forms part of this Annual Report. The requisite certificate the Auditors of the Company confirming compliance with the conditions of corporate governance as stipulated under the aforesaid Regulations, as also the related certificate from CEO/ CFO are attached to the Report on Corporate Governance The auditors’ certificate does not contain any qualification, reservation or adverse remarks.

BOARDS COMPOSITION AND INDEPENDENCE

The composition of the Board is in conformity with Section 149 of the Companies Act, 2013 and Regulation 17 of the SEBI Listing Regulations, which stipulates that the Board should have optimum combination of Executive and Non-executive Directors with at least one Woman Director and at least 50% of the Board should consist of Independent directors, as the Chairman of our Board is an Executive Director.

As on March 31, 2018, the Board comprised of twelve Directors. Out of these, two are Managing Directors who are also the Promoters of the Company and two are Whole Time Directors.

Of the eight Non-Executive Directors, six are Independent Directors. The Company has also appointed one Woman Director, who also is an independent Director. All the Directors possess the requisite qualifications, expertise and experience in general corporate management, finance, banking, laws and other allied fields enabling them to contribute effectively in their capacity as Directors of the Company.

None of the Directors of the Company are related to each other except Dr. Vijay Sankeshwar, Chairman & Managing Director

(CMD) and Mr. Anand Sankeshwar, Managing Director (MD) who are related.

All Independent Directors have given due declarations that they meet the criteria of independence as laid down under section 149(7) of the Companies Act, 2013 and under extant provisions of the SEBI Listing Regulations.

NUMBER OF MEETINGS OF THE BOARD

During the year, five Board Meetings were held, details of which are provided in the Corporate Governance Report. The intervening gap between the Meetings was in compliance with the requirements stipulated under the provisions of the Companies Act, 2013.

COMMITTEES OF THE BOARD

The Board has the following committees:

a. Audit and Risk Management Committee

b. Nomination and Remuneration Committee

c. CSR Committee

d. Stakeholders Relationship Committee

e. Administration Committee f. Finance Committee

Details such as terms of reference, powers, functions, meetings, membership of committee, attendance of directors etc. are dealt with in Corporate Governance Report forming part of this Annual report.

Board has accepted all recommendations made by the Audit and Risk Management Committee during the year.

DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL a) Inductions

During the year under consideration, Mr. K N Umesh was appointed as a Whole Time Director, w.e.f May 19, 2017 and his appointment was subsequently confirmed by the members at the 34th Annual General Meeting of the Company. Mr. L R Bhat was appointed as a whole time director of the Company, at the AGM held on August 4, 2017.

b) Retirement/Re-appointment

Mr. K N Umesh, Whole time director and Dr. Raghottam Akamanchi, Non-Executive Director, retire by rotation and being eligible, offer themselves for reappointment. The Board recommends their appointment.

During the year under review Mr. Ramesh Shetty, Non-Executive Director, retired from the office of director at the 34th Annual

General Meeting of the Company held on August 4, 2017. The Board wishes to place on record his valuable contribution to the company during his tenure as a Director.

None of Independent Directors will retire at the ensuing Annual General Meeting.

c) Resignation

During the year under review, Mr. S R Prabhu, Non-Executive Director of the Company resigned as a Director on May 19, 2017 on personal grounds. The Board wishes to place on record his valuable contribution to the company during his tenure as a Director.

KEY MANAGERIAL PERSONNEL

Pursuant to Section 203 of the Companies Act, 2013, the Key Managerial Personnel (KMP) of the Company are Dr. Vijay Sankeshwar, Chairman and Managing Director, Mr. Anand Sankeshwar, Managing Director, Mr. K N Umesh, Whole time

Director, Mr. L R Bhat, Whole time Director, Mr. Sunil Nalavadi, Chief Financial Officer and Mr. Aniruddha Phadnavis, Company Secretary & Compliance Officer.

STATUTORY DISCLOSURES

None of the Directors of your Company are disqualified as per provisions of Section 164(2) of the Companies Act, 2013. Your

Directors have made necessary disclosures, as required under various provisions of the Companies Act, 2013 and SEBI Listing Regulations.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and SEBI Listing Regulations, the annual performance of the Board, its Committees, Chairperson and Individual Directors including Independent Directors was evaluated as per the criteria laid down by the Nomination and Remuneration Committee. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report which forms part of this Annual Report.

BOARD DIVERSITY

A diverse Board enables efficient functioning through differences in perspective and skill and also fosters differentiated thought processes at the back of varied industrial and management expertise, gender and knowledge. The Board recognizes the importance of a diverse composition and has adopted a Board Diversity policy which sets out the approach to diversity. The said policy can be accessed thru the following link. http://vrlgroup.in/vrl_investor_desk.aspx?display=policies

DIRECTOR’S RESPONSIBILITY STATEMENT

In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that: i) In the preparation of the annual accounts, the applicable accounting standards (IndAS) have been followed along with proper explanation relating to material departures. ii) The directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for that period.

iii) The directors have taken proper and sufficient care 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 directors have prepared the annual accounts on a going concern basis. v) The directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. vi) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively.

Based on the framework of internal financial controls established and maintained by the Company, work performed by the internal, statutory and secretarial auditors, reviews performed by the management and the relevant Board Committees, the

Board, in concurrence with the Audit and Risk Management Committee, is of the opinion that the Company’s internal financial controls were adequate and effective as on March 31, 2018.

RELATED PARTY TRANSACTIONS:

All related party transactions that were entered into during the financialyear were on arm’s length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the company at large.

All Related Party Transactions are placed before the Audit and Risk Management Committee as also to the Board for prior approval. Omnibus approval was obtained semi annually for transactions which are of repetitive in nature. A statement containing details of all transactions entered into pursuant to omnibus approval are placed before the Audit and Risk Management Committee and the Board for review and approval on a quarterly basis.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board of Directors of the Company can be viewed on the website of the Company thru the following link. http://vrlgroup.in/investor_download/RPT%20Policy.pdf

There were no material significant related party transactions entered between the Company, Directors, management, or their relatives. All the contracts/arrangements/transactions entered into by the Company with the related parties during the financial year 2017-18 were in the ordinary course of business and on an arm’s length basis. In our opinion there were no

"material" transactions that warrant a disclosure in this report.

Accordingly, particulars of contracts or arrangements with related parties referred to in Section 188(1) along with the justification for entering into such contract or arrangement in Form AOC-2 does not form a part of this report.

NOMINATION AND 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 including criteria for determining qualifications, positive attributes and other matters provided under sub section (3) of section 178 of the Companies Act 2013. The Remuneration Policy is annexed to this report as Annexure B. The said policy alternatively can also be accessed on the website of the Company at the following link: http://vrlgroup.in/investor_download/Nomination_Remuneration%20Policy.pdf

CODE OF CONDUCT

The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and specified employees in the course of day to day business operations of the company. The Company believes in "Zero Tolerance" against bribery, corruption and unethical dealings / behavior in any form and the Board has laid down certain directives to counter such acts. Such code of conduct has also been placed on the Company’s website. The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders. The Code gives guidance on the expected behaviour from an employee in a given situation and the reporting structure. All the Board Members and the Senior Management personnel have confirmed compliance with the Code.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has a Vigil Mechanism Policy to deal with instances of fraud and mismanagement, if any. Staying true to our core values being committed to high standards of Corporate Governance and stakeholder responsibility, the said policy ensures that strict confidentiality is maintained in respect of whistle blowers whilst dealing with concerns and also specified that no discrimination will be meted out to any person for a genuinely raised concern and also provides a direct access to the Chairman of the Audit and Risk Management Committee. During the year under review none of the personnel has been denied access to the Chairman of Audit and Risk Management Committee.

The Vigil Mechanism policy is available on the website of the Company and can be accessed at the following link. http://vrlgroup.in/investor_download/vigil_Mechanism.pdf

PREVENTION OF INSIDER TRADING

The Company has adopted a Code of Internal Procedures and Conduct for Regulating, Monitoring and Reporting of Trading by Insiders with a view to regulate trading in securities by the Directors and certain designated employees of the Company. The Code requires pre-clearance for dealing in the Company’s shares and prohibits the purchase or sale of Company shares by the Directors and designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the Code. The said code is available on the website of the Company and can be accessed at the following link. http://vrlgroup.in/vrl_investor_desk.aspx?display=policies

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The Board of the Company had laid down policies, guidelines, procedures and structure to enable implementation of appropriate internal financial controls across the Company. These control processes enable and ensure the orderly and efficient conduct of Company’s business, including safeguarding of assets, prevention and detection of frauds and errors, the accuracy and completeness of the Accounting records and timely preparation & disclosure of financial statements. These controls also identify the risks and provides for means to minimize / mitigate the risks affecting the business of the Company as a whole.

Auditors, as required under the Companies Act 2013, have also certified that these internal financial controls are in order and efficient in mitigating the risks.

The Company’s internal audit department enables the Management to mitigate the risks and prevent non-compliance of position of the Company. The scope and authority of the Internal Audit function is well laws which would affect the financial defined and to maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit and Risk Management Committee of the Board as well as directly to the Chairman & Managing Director. The Internal Audit Department 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. Based on the internal audit report from time to time, the management undertakes corrective actions in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions

Audit and Risk Management Committee.

BUSINESS RISK MANAGEMENT:

The Company has in place a risk management architecture that provides a holistic approach to the best of its capabilities.

The Company identifies, assesses and mitigates risks that could materially impact its performance in achieving the stated objectives.

The Audit and Risk Management Committee, on a regular basis, reviews the Company’s portfolio of risks and examines it under the light of the Company’s Risk Appetite.

The material risks affecting Company are identified along with related mitigation measures and elaborated in the Risk

Management Policy of the Company which has also been hosted on the website of the Company and can be accessed at the following link. http://vrlgroup.in/investor_download/Risk%20Management%20Policy.pdf

OTHER POLICIES UNDER SECURITIES AND EXCHANGE BOARD OF INDIA (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015

The Company’s Equity Shares are listed on the BSE and NSE and has paid its Annual listing fees to these stock exchanges for the Financial Year 2018-19. The Company has also formulated the following Policies as required under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015: 1. ‘Policy for Preservation of Documents’ under Regulation 9 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The said policy can be accessed at the following link: http://vrlgroup.in/vrl_investor_desk.aspx?display=policies

2. ‘Policy on Criteria for determining Materiality of Events/Information’ under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 The said policy can be accessed thru the following link: http://vrlgroup.in/vrl_investor_desk.aspx?display=policies

AUDITORS & AUDIT REPORTS a) Statutory Auditors & Audit Report:

In accordance with Section 139 of the Companies Act, 2013 and Rules made thereunder, Members at the 32nd Annual General Meeting of the Company approved the appointment of Statutory Auditors, M/s Walker Chandiok and Co., Chartered

Accountants, LLP, Mumbai for a period of 5 years. The said appointment was subject to ratification by members every However, the requirement of ratification of appointment of Statutory Auditors under proviso to Section 139 of the Companies

Act, 2013 is done away with under the Companies (Amendment) Act, 2017. As such, your Board does not seek members’ ratification for their re-appointment.

There are no qualifications, reservations or adverse remarks made by the Statutory Auditors in their report for the financial year ended March 31, 2018. Pursuant to provisions of section 143 (12) of the Companies Act 2013, the Statutory Auditors have not reported any incident of fraud to the Audit and Risk Management Committee during the year under review.

b) Cost Auditors & Cost Audit Report:

Section 148 of the Companies Act 2013 read with Rules made thereunder mandates every Company belonging to category prescribed in the Rules to undertake a Cost Audit. In compliance with said provision, Company had appointed M/s S.K. Tikare & Co., Cost Accountants, Belgaum to audit the cost records for FY 2017-18. The Cost Auditor has submitted the Cost Audit report for FY 2017-18 and the same is annexed as Annexure C herewith.

There are no qualifications, reservations or adverse remarks made by the Cost Auditors in their report for the financial year ended March 31, 2018.

Pursuant to the recommendation of the Audit and Risk Management Committee, the Board of Directors have re-appointed M/s S K Tikare & Co., Cost Accountants, Belgaum as the Cost Auditors for FY 2018-19 at a fixed remuneration of Rs. 60,000/-, excluding applicable taxes, subject to approval by the members at the ensuing Annual General Meeting of the Company. Board recommends the approval of the said remuneration payable to the Cost Auditor in accordance with Section 148 of the Companies Act 2013 and the Rules made thereunder.

c) Secretarial Auditor & Secretarial Audit Report:

Pursuant to 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. R Parthasarathi, Company Secretary in practice to undertake the Secretarial Audit of the Company for FY 2017-18. The Secretarial Audit report is annexed herewith as Annexure D.

There are no qualifications made by the Secretarial Auditor in his report for the financialyear ended March 31, 2018. Response to the comment made by the Secretarial Auditor in respect of the Company not fully expending the requisite quantum of CSR spend during the year as required under Section 135 of the Companies Act 2013 is given in Annual Report on CSR activities - Annexure E.

Pursuant to the recommendation of the Audit and Risk Management Committee, the Board of Directors have re-appointed Mr. R Parthasarathi, Company Secretary in Practice to conduct the Secretarial Audit for FY 2018-19 at its meeting held on May 26, 2018.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

As required under the provisions of the section 135 of the Companies Act 2013, the Board has constituted the Corporate Social Responsibility Committee which monitors and oversees various CSR initiatives and activities of the Company. The CSR Committee comprises of four directors and three of whom are Independent Directors.The CSR Committee met once during the year. Further details such as composition, terms, functions, meetings and attendance of directors of the said committee are provided in the Corporate Governance report forming part of this Annual Report.

The Company has set up a trust - VRL Foundation for implementing CSR activities which are mainly related to Healthcare,

Sports and Education. A detailed report containing details of CSR activities & contents of CSR policy is annexed as Annexure E. CSR policy of the Company is available on the Company’s website and can be accessed through the following link. http://vrlgroup.in/investor_download/CSR%20POLICY.pdf

EXTRACT OF ANNUAL RETURN:

Extract of the Annual Return in form MGT-9 is annexed herewith as Annexure F.

DETAILS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and expenditure are annexed hereto as Annexure G and forms part of this Report.

PARTICULARS OF EMPLOYEES:

The information required pursuant to Section 197 read with rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, forms part of this report and annexed herewith as Annexure H.

A statement containing top ten employees in terms of remuneration and the names of every employee who is in employment of the Company throughout the year and is in receipt of annual remuneration of Rs. 102 Lakhs or more or employed for a part of year and in receipt of Rs. 8.50 lakhs or more per month needs to be disclosed in the Board’s report. As such the information is annexed as Annexure H to this report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company is in compliance with applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

MATERIAL CHANGES AND COMMITMENTS

There were no material changes and commitments that occurred subsequent to the end of the financial year till the date of this report, which affects the financial position of the Company.

INDUSTRIAL RELATIONS

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

SIGNIFICANT AND MATERIAL ORDERS the regulators or courts or tribunals impacting going concern status There are no significant and company’s operations for a foreseeable future.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT 2013

The Company has in place a Policy for Prevention Prohibition and Punishment of Sexual Harassment of Women at Work place in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal)

Act 2013. Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. All employees are covered under this policy. During the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

ACKNOWLEDGMENTS AND APPRECIATION

The Directors take this opportunity to thank the Company’s customers, shareholders, investors, suppliers, bankers, financial institutions and Central & State Governments for their consistent support to the Company. The Directors also wish to place on record their appreciation to employees at all levels for their hard work, dedication and commitment..

For and on behalf of the Board

Dr. Vijay Sankeshwar

Chairman & Managing Director

DIN: 00217714

Place: Hubballi

Date: 26th May 2018