Welspun Investments & Commercials Ltd Directors Report.

To,

The Members,

Welspun Investments and Commercials Limited

Your directors have pleasure in presenting the 10th Annual Report of your Company along with the Audited Financial Statements for the financial year ended March 31, 2018.

1. Financial Results

()
Particulars 2017-18 2016-17
Total Income 1,37,33,999 85,59,181
Expenditure (1,11,73,846) (80,36,948)
Profit after taxation 25,60,153 5,22,233
Other Comprehensive Income (Net of Tax) 45,59,31,526 4,54,84,456
Total Comprehensive Income 45,84,91,679 4,60,06,689

2. Performance

During the year under review, the Company prepared its Financial Statements in compliance with IND AS.

The Company fared better in its business and its total income increased by over 60% as compared with last year.

The management is hopeful that the Company will be able to improve its performance in the years ahead.

3. Reserves & Dividend

The Company has not transferred any amount to reserve. In view of the accumulated losses, your directors do not recommend any dividend for the financial year ended March 31, 2018.

4. Internal controls

The Board had laid down internal financial controls to be followed by the Company which are commensurate with the size, scale and complexity of its business and such internal financial controls are adequate and were operating effectively within the meaning of the explanation of Section 134(5)(e) of the Companies Act, 2013.

5. Deposits

The Company has not accepted any deposit within the meaning of the Chapter V to Companies Act, 2013. Further, no amount on account of principal or interest on deposit was outstanding as at the end of the year under report.

6. Associate Company

There was no change in the associate company as at the beginning and end of the year under report.

7. Auditors

i) Statutory Auditors

M/s. P Y S & Co., LLP, Chartered Accountants (Firm Registration No. 012388S) (Formerly known as M/s. P Y S & Co.), who have been appointed up to the conclusion of the 12th Annual General Meeting, subject to ratification by the Members of the Company at every Annual General Meeting, have given their consent to continue to act as the Auditors of the Company for the remaining tenure. Members are requested to ratify their appointment as the Auditors of the Company and to fix their remuneration by passing an ordinary resolution under Section 139 of the Companies Act, 2013.

ii) Secretarial Auditors

The Board of Directors has re-appointed M/s. S. S. Risbud & Co., Company Secretaries, as the Secretarial Auditors of the Company for the financial year 2018-19.

8. Auditors Report

i) Statutory Auditors Report

The Auditors observation, if any, read with Notes to Accounts are self-explanatory and therefore, do not call for any comment.

ii) Secretarial Audit Report

Secretarial Audit Report given by M/s. S. S. Risbud & Co., Company Secretaries is annexed with the report as Annexure 1.

9. Share Capital & Listing

i) Issue of equity shares with differential rights

The Company has not issued shares with differential rights and hence, disclosures as required in Rule 4(4) of the Companies (Share Capital and Debentures) Rules, 2014 are not required.

ii) Disclosure of Shares held in suspense account under Clause F of Schedule V to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Outstanding Balance in the suspense account lying at the beginning of the year

Number of shareholders who approached issuer for transfer of shares from suspense account during the year

Transferred/Credited during the year

Balance outstanding

No. of shareholders No. of Shares No. of shareholders No. of Shares No. of shareholders No. of Shares No. of shareholders No. of Shares
1,010 4,568 4 17 4 17 1,006 4,551

The voting rights on these shares shall remain frozen till the rightful owner of such shares claims the shares.

iii) Listing with the stock exchanges

The Companys equity shares are listed on the BSE Limited (BSE) and The National Stock Exchange of India Limited (NSE).

Annual listing fees for the year 2018-19 have been paid to BSE and NSE.

10. Extract of the annual return

An extract of the annual return in Form MGT-9 of the Companies (Management and Administration) Rules, 2014 is attached to this report as Annexure 2.

11. Conservation of energy, technology absorption and foreign exchange earnings and outgo Your Company does not carry any activity which is covered under Section 134(3)(m) of the Companies Act, 2013 and applicable rules and accordingly no data needs to be provided in this regard.

12. Directors and Key Managerial Personnel

i) Changes in Directors and Key Managerial Personnel

Since the last report, no change in Key Managerial Personnel of the Company took place.

Mr. L. T. Hotwani is retiring by rotation at the forthcoming Annual General Meeting and being eligible, has been recommended for re-appointment by the Board.

Details about the director being re-appointed is given in the Notice of the forthcoming Annual General Meeting being sent to the members along with the Annual Report.

ii) Declaration by Independent Directors

Your Company has received declarations from all the Independent Directors as per the provisions of Section 149(7) of the Act confirming that they meet the criteria of Independence as prescribed under the provisions of Section 149(6) of the Act and that there is no change in the circumstances as on the date of this Report which may affect their respective status as an Independent Director.

iii) Formal Annual Evaluation

As done last year, this year also, the Company followed the same evaluation process with specific focus on the performance vis-a-vis the plans, meeting challenging situations, performing leadership role within, and effective functioning of the Board etc. which was in line with the SEBI Guidance Note on Board Evaluation dated January 5, 2017. The evaluation process invited, through IT enabled platform, and graded responses to a structured questionnaire for each aspect of the evaluation viz. time spent by each of the directors; accomplishment of specific responsibilities and expertise; conflict of interest; integrity of the Director; active participation and contribution during discussions. For the financial year 2017-18, the annual performance evaluation was carried out which included evaluation of the Board, independent directors, non-independent directors, Chairman, Committees of the Board, quantity, quality and timeliness of information to the Board. The independent directors evaluated all non-independent directors, the Board, the Committees, the Chairman and the information to the Board. The Nomination and Remuneration Committee and the Board evaluated performance of the independent directors, the Board itself, the Chairman, the Committees of the Board, the information provided to the Board. All results were satisfactory.

13. Number of meetings of the Board of Directors

The Companys Board consists of eminent persons with considerable professional expertise and experience thereby ensuring the best interest of stakeholders and the Company. The Board comprises of 4 Directors out of which 3 are Independent Directors.

The composition and category of directors and relevant details relating to them are given below:

Name of Director Category Board Meetings Attended during the Year 2017-18 Attendance at the Last AGM
Mr. L. T. Hotwani NE 5/5 No
Mr. Atul Desai NE, I 5/5 No
Mr. Raj Kumar Jain NE, I 5/5 Yes
Ms. Mala Todarwal NE, I 4/5 No

Abbreviations:

I = Independent, NE = Non-Executive Director

5 meetings of the Board of Directors were held during the financial year 2017-18 on the following dates: May 08, 2017, August 11, 2017, September 13, 2017, December 12, 2017 and February 13, 2018.

In addition to the above, a meeting of the Independent Directors was held on March 26, 2018 in compliance with the Section 149(8) read with Schedule V to the Companies Act, 2013. The said meeting was attended by Mr. Atul Desai, Mr. Rajkumar Jain and Ms. Mala Todarwal.

It is confirmed that there is no relationship between the directors inter-se.

14. Audit Committee

The Committee comprises of 3 non-executive independent directors having accounting and finance back-ground. The composition of the Committee and attendance of the members is given hereunder:

Name of the Member Member / Chairman Number of Meetings Attended
Mr. Rajkumar Jain Chairman 5/5
Mr. Atul Desai Member 5/5
Ms. Mala Todarwal Member 4/5

The Company Secretary of the Company acted as the Secretary of the Committee.

5 meetings of the Audit Committee of the Board of Directors were held during the financial year 2017-18 on following dates: May 08, 2017, August 11, 2017, September 13, 2017, December 12, 2017 and February 13, 2018.

None of recommendations made by the Audit Committee were rejected by the Board.

Terms of reference -

The terms of reference stipulated by the Board of Directors to the Audit Committee are as contained under the Listing Agreement / SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Section 177 of the Companies Act, 2013.

15. Nomination and Remuneration Committee

The Company had constituted the Nomination and Remuneration Committee consisting of non-executive independent directors. During the year under review, 2 meetings of the Committee were held on May 08, 2017 and December 12, 2017.

Terms of reference -

To recommend appointment of, and remuneration to, directors, Key Managerial Personnel and Senior Management Personnel and review thereof from time to time.

Composition of the Committee -

The Committee comprises of 3 non-executive independent directors as on date of this Report viz. Mr. Atul Desai, Mr. Rajkumar Jain and Ms. Mala Todarwal.

Remuneration Policy -

The Company follows a policy on remuneration of directors and senior management employees and the salient features thereof are as under:

Appointment of Directors -

• While identifying persons who may be appointed directors, the Committee shall consider business of the Company, strength, weakness, opportunity and threats to companys business, existing composition of the board of directors, diversity, skills, expertise of existing directors and background, skills, expertise, reputation and qualification possessed by persons being considered, specific requirements under Companies Act, 2013, standard listing agreement and any other laws as to composition of the Board.

• While identifying persons who may be appointed as independent directors, the Committee shall review their qualifications and suitability to ensure that such candidates will be able to function as directors Independently and avoid any conflict of interest, obligations, pressure from other Board members, KMPs, senior management and other persons associated with the Company.

Remuneration of directors, Key Managerial Personnel, Senior Management Personnel -

• The remuneration to executive directors, Key Managerial Personnel and Senior Management Personnel at the time of appointment shall be mutually agreed. The Committee shall consider top industry indicators, requirements of role, qualification and experience of candidate, expected contribution of executive to the profitability challenges specific to the Company and such other matters as the Committee may deem fit. The remuneration must motivate individuals to achieve benchmarks which must be aligned to the vision of the Company. It may contain fixed pay. The management shall periodically find out the remuneration scale prevalent in the industry / peer group to the extent possible to find out if there is a need for revision in remuneration for retaining the talent.

• The Non-Executive directors shall not be eligible for any remuneration / commission, unless specifically approved by the Board of Directors on recommendation of the Nomination and Remuneration Committee and by the shareholders.

• The Non- Executive Directors including independent directors may receive remuneration by way of fees for attending meetings of Board or Committee thereof. Provided that the amount of such fees shall not exceed 1,00,000 per meeting of the Board or Committee or such amount as may be prescribed by the Central Government from time to time.

• The Non-Executive Directors may be paid commission after complying with required provisions of the Companies Act, 2013.

Besides, the Committee shall take into consideration performance, of the concerned executive as well as the Company, to the growth of business, profitability, company potentiality and critical role played / initiatives taken while considering pay hike / increment to the concerned executives.

16. Establishment of vigil mechanism for directors and employees

The Company has a Whistle Blower Policy and Vigil Mechanism for its directors and employees and any director or employee may make protected disclosures to the Audit Committee and no personnel have been denied access to the Audit Committee.

17. Particulars of contracts or arrangements with related parties

A related party transaction that was entered into during the year under report was on an arms length basis and was in the ordinary course of business. There were 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. A related party transaction was entered into because of mutual need and to serve mutual interest. Except for this, sitting fees to independent directors, related party transaction listed in the financial statements, none of the Directors has any pecuniary relationships or transactions vis-a-vis the Company. The requirement of Form AOC-2 is not applicable to the Company.

18. Loans, Guarantees and Investments

The Company during the Financial Year under review has not given any loans, guarantees, security or made any investments requiring members approvals under section 186 of the Companies Act, 2013.

19. Managerial Remuneration

No remuneration or perquisite was paid to, and no service contract was entered into with, but the sitting fees were paid to, the following independent directors for attending meetings of Board / Committees of the Board for the Financial Year ended 31.03.2018 are as under:

Name of the Director Sitting Fees (?)
1 Mr. Atul Desai 1,68,000
2 Mr. Rajkumar Jain 1,89,000
3 Ms. Mala Todarwal 1,44,500

The above mentioned sitting fees paid to the independent directors was within the limits prescribed under the Companies Act, 2013 for payment of sitting fees.

None of the directors had any transaction with the Company.

20. Shareholding of the Directors of the Company as on March 31,2018

As on March 31, 2018, none of the directors held any shares in the Company.

21. Management Discussion and Analysis

A separate report on Management Discussion and Analysis is enclosed as a part of the Annual Report Directors Responsibility Statement

Pursuant to Section 134(3)(c) & 134(5) of the Companies Act, 2013, your directors hereby confirm that:

a. in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b. the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

c. the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. the directors had prepared the annual accounts on a going concern basis;

e. being a listed company, 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; and

f. the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

22. Miscellaneous

During the year under report, there was no change in the general nature of business of the Company.

No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statements relate on the date of this report No significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and the Companys operations in future.

The Company has not made any provision of money for the purchase of, or subscription for, shares in your Company or its holding company, to be held by or for the benefit of the employees of your Company and hence the disclosure as required under Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014 is not required.

23. Acknowledgements

Your Directors wish to acknowledge the co-operation and support extended by the group companies, Central Government, State Governments, bankers, customers, and the shareholders. It will always be the Companys endeavor to build and nurture strong relationship for mutual benefit.

For and on behalf of the Board of Directors

L. T. Hotwani Atul Desai
Director Director
Place: Mumbai DIN - 00007125 DIN - 00019443
Date: May 23, 2018