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Directors Report of Akme Star Housing Finance Ltd.

Mar 31, 2016

Director’s Report

To

The Members

Akme Star Housing Finance Limited

Udaipur

The Directors take pleasure in presenting the 11th Annual Report together with the audited financial statements for the year ended March 31, 2016. The Management Discussion and Analysis has also been incorporated into this report.

KEY FINANCIALS :

The Board’s Report shall be prepared based on the stand alone financial statements of the company. The Company’s financial performance for the financial year ended March 31, 2016, is summarized below :-

Rs. In Lacs

Particular

2015-16

2014-15

Gross Income

272.35

201.83

Less : Finance Cost

30.01

36.72

Overhead

68.77

65.38

Depreciation

4.64

1.74

Profit Before Tax

168.93

97.99

Less : Provision for taxation

53.40

31.30

Profit After tax

115.52

66.69

Balance Brought Forward from last year

117.35

70.25

Amount available for appropriation

232.87

136.94

Appropriations

Transferred to Statutory Reserve under Section 36(1)(viii) of the Income Tax Act, 1961 read with Section 29C of National Housing Bank Act, 1987

33.78

19.59

Transferred to general reserve

Nil

Nil

Balance Carried over to the Balance Sheet

199.09

117.35

232.87

136.94

Transfer to Reserves

During the year under review, your Company transferred NIL to the General Reserve during the year under review and 33.78 Lacs to the Statutory Reserve under Section 36(1) (viii) of the Income Tax Act, 1961 read with Section 29C of National Housing Bank (NHB) Act, 1987 out of the amount available for appropriation and an amount of 232.87 Lacs is proposed to be retained in the Profit and Loss Account.

HIGHLIGHTS OF PERFORMANCE

The Company has achieved a gross income and net profit of Rs. 272.35 Lacs and Rs. 115.52 Lacs during the year under review as compared to Rs. 201.83 Lacs and Rs. 66.69 Lacs in the previous year respectively.

The housing loans/other loan outstanding during the year ended 31st March, 2016 were of Rs. 1551.25 lacs as against Rs. 1232.20 lacs during the previous year.

The Net Owned Funds (NOF)/ Net worth of your Company worth Rs 1653.78 Lacs as on 31.03.2016 as against Rs 1538.25/- Lacs during the previous year.

The Earnings Per Share (EPS) is Rs. 1.95 as at March 31, 2016 as against Rs. 1.52 as at March 31, 2015. DIVIDEND

To look after the further expansion of business activity and inadequacy of profits your directors do not recommend any payment of dividend for the year ended 31st March, 2016.

SHARE CAPITAL Authorized Share Capital

During the year under review the authorized share capital of the Company stood at '' 6,00,00,000 (divided into 60,00,000 Equity Shares of '' 10/- each). No change was made in authorized Share Capital as compared to previous Year.

Issued and Paid-up Capital

Your Company’s Share Capital is Rs 59,345,000 (divided into 5934500 Equity shares of Rs. 10/- each) as at March 31, 2016 and no change was made in issued and Paid up capital as compared to previous year.

EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS

There are no material changes and commitments affecting financial position of the Company between 31st March and the date of Board’s Report.

DETAILS RELATING TO DEPOSITS

The Company has been granted registration by the National Housing Bank, New Delhi as a non deposit taking Housing Finance Company. Being so, the Company has neither accepted in the past nor has any future plans to accept any public deposits, by whatever name called.

INVESTOR COMPLAINTS AND COMPLIANCE

During the year under review the Company did not receive any investor complaints and that as on the date no complaints are pending.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY:

Your Company adhered to the prudential guidelines for Non performing Assets (NPAs), issued by the National Housing Bank (NHB) under its Directions of 2010, as amended from time to time. As per the prudential norms, the income on such NPAs is not to be recognized if unrealized. As per the prudential norms prescribed by the NHB, the Company has made provision for contingencies on standard as well as non-performing housing loans and property loans. The details of NPA have been given in financial Statements.

RESOURCE MOBILISATION

Your Company’s borrowing policy is under the control of the Board. The Company has vide special resolution on September, 10th, 2014, under Section 180(1)(c) of the Companies Act, 2013, authorized the Board of Directors to borrow money upon such terms and conditions as the Board may think fit in excess of aggregate of paid up share capital and free reserves of the Company up to an amount of Rs. 50 crore and the total amount so borrowed shall be within the limits as prescribed under the Housing Finance Companies (NHB) Directions, 2010.

Your Company continued to use a variety of funding sources to optimize funding costs, protect interest margins and maintain a diverse funding portfolio which further strengthened its funding stability and liquidity needs. Your Company continued to keep tight control over the cost of borrowings through negotiations with lenders and thus, raised resources at competitive rates from its lenders while ensuring proper asset liability match.

LOANS FROM BANKS

As part of its liability management, your Company endeavors to diversify the sources of its resource base in order to achieve an appropriate maturity structure and minimize the weighted average cost of borrowed funds. Your Company continued to leverage on its long term relationship with banks and thus tied up fund based working capital limit amounting to 3.00 Crore as at the end of financial year.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013, apart from the loans made, guarantee given or security provided by the Company in the ordinary course of business are given in the Notes to accounts forming part of the Audited Financial Statements for the year ended March 31, 2016.

CAPITAL ADEQUACY

As required under National Housing Bank Directions, your Company is presently required to maintain a minimum capital adequacy of 12% on a standalone basis. In addition, the National Housing Bank Directions also require that your Company transfers minimum 20% of its annual profits to a reserve fund.

Your Company’s Capital Adequacy Ratio is at 114.35 % as at March 31, 2016, which provides an adequate cushion to withstand business risks and is above the minimum requirement of 12% stipulated by the National Housing Bank.

SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any subsidiary Company or Joint Company or Associate Company.

HUMAN RESOURCES AND TRAINING

Your Company has experienced promoters and a team whom your Company relies upon to to capitalize on emerging new business opportunities. Your Company believes that a combination of its reputation in the market, its working environment and competitive compensation programs allows it to attract and retain best talent. Your Company strives to attract the best talent in the industry and ensures its employees’ development and their contribution to the Company’s success.

Your Company’s vision is to become an employer of choice by providing a compelling employee value proposition. Your Company has molded its policies relating to hiring, deployment, transfers, promotion, training, including its performance-linked bonuses with the clear aim of building a ‘cadre-based organization, whose cadre understands the company’s customers, their problems, issues and aspirations. Your Company’s human resources policies and practices are focused on recruiting and training employees who can empathies and deal with potential and existing borrowers..

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, there are no employees of the Company covered under this section who is earning salary over and above specified limit.

DISCLOSURE UNDER SUB-SECTION (3) OF SECTION 134 OF COMPANIES ACT, 2013, READ WITH RULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES, 2014

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows: Conservation of energy:

The Company does not fall under any of the industries covered by the Companies (Disclosure of particulars of Directors) Rules, 1988.

Technology absorption:

The Company is not involved in any technology absorption nor is there any R&D activity during the year

Foreign Exchange Earnings and Outgo

Your company does not have any foreign exchange earnings and outgo during the year under review.

INSURANCE

Your Company has insured its various properties and facilities against the risk of fire, theft and other perils, etc. and has also obtained Directors’ and Officers’ Liability Insurance Policy, which covers the Company’s Directors and Officers (employees in managerial or supervisory position) against the risk of financial loss including the expenses pertaining to defense cost and legal representation expenses arising in the normal course of business

NATIONAL HOUSING BANK (NHB) GUIDELINES

The Company has complied with the provisions of the Housing Finance Companies (NHB) Directions, 2010 as prescribed by NHB and has been in compliance with the various Circulars, Notifications and Guidelines issued by National Housing Bank (NHB) from time to time. The Circulars and the Notifications issued by NHB are also placed before the Audit Committee / Board at regular intervals to update Committee / Board members on the same.

RISK MANAGEMENT

As a housing finance company, your Company is exposed to various risks that are inherent in the lending business. The primary risks include credit risk, market risk, liquidity risk, legal risks, interest rate risk, compliance risk and operational risk. Your Company has invested in people, processes and technology to mitigate risks posed by internal and external environment. Your Company places emphasis on risk management measures to ensure an appropriate balance between risk and return. The Board also on regular intervals is updated on the risk management systems, processes and minimization procedures of the Company.

Pursuant to the requirement of the SEBI (LODR) Guideline, 2015, the Company has constituted a Business Risk Management Committee. The details of Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board’s Report. During the year, the Board reviewed the risks associated with the business of the Company, its root causes and the efficacy of the measures taken to mitigate the same. The procedures are adopted to assess the risks and their mitigation mechanisms.

ASSET LIABILITY MANAGEMENT COMMITTEE (ALCO)

The Asset Liability Management Committee (ALCO) lays down policies and quantitative limits that involve assessment of various types of risks and shifts in assets and liabilities to manage such risks. ALCO ensures that the liquidity and interest-rate risks are contained within the limits laid down by the Board. The Company has duly implemented the NHB’s Asset Liability Management Guidelines.

CODES AND POLICIES & COMPLIANCES THEREUNDER

Your Company has formulated various policies and codes in compliance with provisions of Directions and Guidelines issued by the National Housing Bank, Companies Act, 2013, Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and to ensure high ethical standards in the overall functioning of the organization. The said policies and codes are periodically reviewed by the Board of Directors.

The key policies and codes as approved by the Board of Directors and the respective compliance there under are detailed herein below:

KNOW YOUR CUSTOMER & ANTI MONEY LAUNDERING MEASURE POLICY

Your Company has a Board approved Know Your Customer & Anti Money Laundering Measure Policy (KYC & AML Policy) in place and adheres to the said Policy. The said Policy is in line with the National Housing Bank guidelines. The Company has also adhered to the compliance requirement in terms of the said policy relating to the monitoring and reporting of cash / suspicious transactions. The Company furnishes to Financial Intelligence Unit (FIU), India, in the electronic medium, information of all cash transactions of the value of more than Rupees ten lakh or its equivalent in foreign currency and suspicious transactions whether or not made in cash, in terms of the said Policy.

FAIR PRACTICE CODE

Your Company has in place a Fair Practice Code (FPC), which includes guidelines on appropriate staff conduct when dealing with the customers and on the organization’s policies vis-a-vis client protection. The FPC captures the spirit of the National Housing Bank guidelines on fair practices for Housing Finance Companies.

During the year under review, FPC was modified by the Board and the grievance redressal mechanism within the Company was further strengthened.

POLICY ON DISCLOSURE OF MATERIAL EVENTS AND INFORMATION

During the year under review, your Company has adopted the Policy on Disclosure of Material Events and Information, in accordance with Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations,

2015 to determine the events and information which are material in nature and are required to be disclosed to the Stock Exchanges.

CODE OF CONDUCT FOR BOARD MEMBERS AND THE SENIOR MANAGEMENT

Your Company has in place Code of Conduct for the Board of Directors and the Senior Management Personnel to set forth the guiding principles on which the Company and its Board and Senior Management Personnel shall operate and conduct themselves with multitudinous stakeholders, government and regulatory agencies, media and anyone else with whom it is connected. A declaration by Chief Executive Officer, with regard to the Compliance with the said code, forms part of this Annual Report.

CODE FOR PREVENTION OF INSIDER TRADING PRACTICES

Your Company has formulated and adopted a Code for Prevention of Insider Trading Practices in accordance with the model code of conduct as prescribed under the SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended. The code lays down guidelines, which includes procedures to be followed and disclosures to be made while dealing in the shares of the Company.

The code is applicable to the promoters, directors, senior designated employees and their dependents and the said persons are restricted from dealing in the securities of the Company during the ‘restricted trading periods’ notified by the Company, from time to time.

CODE OF BUSINESS ETHICS (COBE)

Your Company has adopted a Code of Business Ethics (COBE) which lays down the principles and standards that govern the activities of the Company and its employees to ensure and promote ethical behavior within the legal framework of the organization.

WHISTLE BLOWER POLICY

Pursuant to the provisions of Section 177 (9) & (10) of the Companies Act, 2013 read with Rule 7 of Companies (Meetings of Board and its Powers) Rules, 2014 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has in place a Whistle Blower Policy, which provides for a vigil mechanism that encourages and supports its Directors and employees to report instances of illegal activities, unethical behavior, actual or suspected, fraud or violation of the Company’s Code of Conduct or Ethics Policy. It also provides for adequate safeguards against victimization of persons who use this mechanism and direct access to the Chairman of the Audit Committee in exceptional cases.

SEXUAL HARASSMENT POLICY

Your Company has in place a Policy on Prevention, Prohibition & Redressal of Sexual Harassment of Women at Workplace and an Internal Complaints Committee (ICC) has been constituted there under. The Policy’s primary objective is to protect the women employees from sexual harassment at the place of work and also provides for punishment in case of false and malicious representations. During the year no complaints were received in this regard.

COMPREHENSIVE RISK MANAGEMENT POLICY

Your Company is committed to manage its risk in a proactive manner and has adopted a structured and disciplined approach to risk management by developing and implementing risk management framework. With a view to manage its risk effectively your Company has in place a Comprehensive Risk Management Policy which covers a formalized Risk Management Structure, along with other aspects of risk management i.e. credit risk management, operational risk management, market risk management and enterprise risk management. The Risk Management Committee of the Board, on periodic basis, oversees the risk management systems, processes and minimization procedures of the Company

CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY

Your Company has framed Corporate Social Responsibility Policy (CSR Policy), as per the provisions of the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended, which, inter-alia, lays down the guidelines and mechanism for undertaking socially useful projects for welfare and sustainable development of the community at large. As per the provisions of Section 135 of the Companies Act, 2013, the Company has constituted a Corporate Social Responsibility Committee. The Committee assists the Board in fulfilling its duty towards the community and society at large by identifying the activities and programmes that can be undertaken by the Company, in terms of the Company’s CSR Policy. The composition of the CSR Committee and its terms of reference are given in the Corporate Governance Report forming part of this Annual Report.

However Company has adopting CSR Policy and constituted CSR Committee on voluntary basis.

REMUNERATION POLICY

The Board of Directors had on the recommendation of the Nomination & Remuneration Committee Appointed Mr. Avinash Bhatnagar Independent Director as chairman, Mr. Amrit Singh Rajpurohit and Mrs. Rajni Gehlot Independent Director as Member.

The Company follow a Policy on remuneration of Directors and senior management Employees, The Policy is approved by the Nomination & Remuneration Committee and the Board and is marked as Annexure-I

VIGIL MECHANISM

Fraud free and corruption free work culture has been core to the Company. on view of the potential risk of fraud and corruption due to rapid growth and geographical spread of operations, the company has put an even greater emphasis to address this risk.

The Audit Committee of the Company is also looking for prevent the fraud under the Vigil mechanism for the Company. RELATED PARTY TRANSACTIONS POLICY

Your Company has in place Related Party Transaction Policy, intended to ensure requisite approval, reporting and disclosure of transactions between the Company and its related parties. The said policy also defines the materiality of related party transactions and lays down the procedures of dealing with related party transactions.

During the year under review, the Related Party Transaction Policy was amended to align the same with the requirements of Companies (Amendment) Act, 2015 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:

The objective of a familiarization programme is to ensure that the non-executive directors are updated on the business environment and overall operations of the Company. This enables the non executive directors to make better informed decisions in the interest of the company and its stakeholders.

LISTING OF SHARES OF THE COMPANY

Your Company’s equity shares continue to remain listed on BSE Limited. As per the requirements of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, which came in effect from December 1, 2015, a shortened version of the Uniform Listing Agreement was signed by the Company with BSE Limited. Your Company has paid the listing fees as payable to the BSE Limited for the financial year 2016-17 on time.

DIRECTORS AND KEY MANAGERIAL PERSONAL Appointment of Independent Directors

The Board appointed all the existing Independent Directors viz. Mr. Amrit Singh Rajpurohit and Mrs. Rajni Gehlot as Independent Director under Section 149 of the Companies Act 2013 for a term of Five Years from the 9th Annual general Meeting.

The Shareholder approves their appointment in Annual General Meeting held on 10th September 2014.

The Board appointed existing Independent Directors viz. Mr. Avinash Bhatnagar as Independent Director under Section 149 of the Companies Act 2013 for a term of Five Years from the 10th Annual general Meeting.

The Shareholder approved their appointment in Annual General Meeting held on 08th August, 2015

All Independent Directors have given declarations that they meet the criteria of independence, as laid down under Section 149(6) of the Companies Act, 2013 and the provisions of Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Based on the confirmations received, none of the Directors are disqualified for being appointed/re-appointed as directors in terms of Section 164 the Companies Act, 2013.

Declaration from Independent directors on Annual basis:

The Company has received necessary declaration from each Independent Director of the Company Under Section 149(7) of the Companies Act, 2013 that the Independent Directors of the Company meet with the criteria of their Independence as laid down in Section 149(6).

Retirement of Director by rotation

In accordance with the provisions of Section 152 of the Companies Act, 2013 and Articles of Association, Mr. Nirmal Kumar Jain, Director of your Company being the longest in office among Directors who are liable to retire by rotation, retires by rotation and being eligible; offers himself for reappointment at the ensuing Annual General Meeting.

Stock Option

During the year under review, no stock options were issued to the Directors of the Company.

BOARD EVALUATION PERFORMANCE EVALUATION

The provisions of the Companies Act, 2013 mandates formal annual evaluation of the Board of Directors, its committees and individual Directors. Schedule IV of the Companies Act, 2013 also requires the performance evaluation of Chairman

& Managing Director and Non Executive Directors and Board as a whole to be carried out at a separate meeting by the Company’s Independent Directors. It also states that performance evaluation of Independent Directors shall be done by the entire Board excluding the Director being evaluated. The provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, also require that the Board shall monitor and review the Board Evaluation Framework. The annual performance evaluation of the Board as a whole, all Directors as well as the evaluation of the Board Committees including Audit Committee, Nomination & Remuneration Committee, Risk Management Committee, Stakeholders’ Relationship Committee, and Corporate Social Responsibility Committee of the Board of Directors of the Company, was carried out.

MEETINGS

Your Company holds at least four Board meetings in a year, one in each quarter, inter-alia, to review the financial results of the Company. The Company also holds additional Board Meetings to address its specific requirements, as and when required. All the decisions and urgent matters approved by way of circular resolutions are placed and numbered and noted at the subsequent Board meeting. Annual calendar of meetings of the Board are finalized well before the beginning of the financial year after seeking concurrence of all the Directors.

During the financial year 2015-16, six (6) Board Meetings were convened and held. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations, 2015. The details of the Board composition, its meetings held during the year along with the attendance of the respective Directors thereat are set out in the Corporate Governance Report forming part of this Annual Report.

The Company’s Independent Directors meet at least once in every financial year without the presence of Executive Directors or management personnel. The Independent Directors of the Company met once during the year on March 15th,

2016 to review the performance of Non-Independent Directors and the Board as a whole, review the performance of the Chairperson of the Company and access the quality, quantity and timeliness of flow of information between the company management and the Board.

BOARD COMMITTEES

Your Company has a duly constituted Audit Committee as per the provisions of Section 177 of Companies Act, 2013 and provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Board of Directors has constituted four other committees namely - Nomination and Remuneration Committee, Stakeholders’ Relationship Committee, Risk Management Committee, and Corporate Social Responsibility Committee which enables the Board to deal with specific areas / activities that need a closer review and to have an appropriate structure to assist in the discharge of their responsibilities.

The Audit Committee and other Board Committees meet at regular intervals and ensure to perform the duties and functions as entrusted upon them by the Board.

The details of the Audit Committee and other Board Committees are also set out in the Corporate Governance Report forming part of this Annual Report.

RELATED PARTY TRANSACTIONS

There were no materially significant related party transactions i.e. transactions of material nature, with its promoters, directors or senior management or their relatives etc., that may have potential conflict with the interest of company at large. Transactions entered with related parties, as defined under the Companies Act, 2013 and provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 during the financial year 2015-16 were mainly in the ordinary course of business and on an arm’s length basis.

Details of RPT in Form AOC-2 attached to Board report may also be referred to and marked as Anexure-II

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATOR OR COURT OR TRIBUNALS

The Company has been following directions, guidelines, circulars issued by SEBI, BSE, MCA, NHB etc. from time to time relating to listed companies and that the regulations of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 are now applicable to the listed companies w.e.f. December, 2015

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Your Company has appointed a Chartered Accountant as an Internal Auditor of the Company, who reports to the Audit Committee and to the Board of Directors of the Company. The Internal Auditor conducts comprehensive audit of functional areas and operations of the Company to examine the adequacy of and compliance with policies, procedures, statutory and regulatory requirements. Significant audit observations and follow up actions thereon are reported to the Audit Committee. The Audit Committee reviews adequacy and effectiveness of the Company’s internal control environment and monitors the implementation of audit recommendations.

The audit function maintains its independence and objectivity while carrying out assignments. It evaluates on a continuous basis, the adequacy and effectiveness of internal control mechanism. The function also proactively recommends improvement in policies and processes, suggests streamlining of controls against various risks

Your Company has laid down set of standards, processes and structure, which enables it to implement internal financial control across the Company and ensure that the same are adequate and operating effectively.

SECRETARIAL AUDITOR & SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed Mr. Ronak Jhuthawat Proprietress of M/s Ronak Jhuthawat & Co., Practicing Company Secretaries, Udaipur, to undertake the Secretarial Audit of the Company for the financial year 2015-16. The Secretarial Audit Report for the financial year ended March 31, 2016, is annexed as “Annexure - III” to this report. The said report, does not contain any qualification, reservation or adverse remark, however, contains certain observations of the Secretarial Auditor which are self explanatory, and thus do not call for any further comments.

AUDITORS Statutory Auditors

M/s. Nyati Mundra & Co. (FRN 008153C) Chartered Accountants, the Statutory Auditors have not offered themselves to continue as Statutory Auditors of the Company in view of their pre-occupation with other work. The Board places on record its appreciation for the services rendered by them during their tenure with the Company.

Based on the recommendation of the Audit Committee, the Board of Directors, have appointed M/s. H.R. Jain & Co. (FRN 000262C) as the Statutory Auditors of the Company, subject to the approval by the Members of the Company in the Company’s ensuing annual general meeting. M/s. H.R. Jain & Co. shall hold office for the first term of five years, from the conclusion of the 11th Annual General Meeting until the conclusion of the 16th Annual General Meeting of the Company (subject to ratification of their appointment by the Members at every subsequent Annual General Meeting). The proposal for their appointment as Statutory Auditors of the Company is included in the Notice of the ensuing annual general meeting for approval of the Members of the Company. M/s. H.R. Jain & Co. has furnished written consent and a confirmation to the effect that they are not disqualified to be appointed as the Statutory Auditors of the Company in terms of the provisions of Companies Act, 2013 and Rules framed there under. In terms of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, they have confirmed that they hold a valid certificate issued by the Peer Review Board of the ICAI.

Notes to Accounts and Auditors Report

The notes to the accounts referred to in Auditors Report are self-explanatory and do not call for any further comments. The Statutory Auditors Report does not contain any qualification, reservation or adverse remark.

QUALIFICATIONS IN AUDIT REPORTS:

There are no qualifications, reservations or adverse remarks or disclaimer made—

(a) By the statutory auditor in his report; and

(b) By the company secretary in practice in his secretarial audit report;

DIRECTORS’ RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:

i) that in the preparation of the annual financial statements for the year ended March 31, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii) that such accounting policies as mentioned in Note of the Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2016 and of the profit of the Company for the year ended on that date;

iii) that proper and sufficient care has been taken 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;

iv) that the annual financial statements have been prepared on a going concern basis;

x) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;

vi) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

REPORT ON CORPORATE GOVERNANCE

Pursuant to Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section titled ‘Report on Corporate Governance’ forms part of this Annual Report.

The Report on Corporate Governance also includes certain disclosures that are required, as per Companies Act, 2013. The certificate by the Statutory Auditors confirming Compliance with the conditions of Corporate Governance as stipulated in Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed as ‘Annexure V’ to this report. The said certificate for financial year 2015-16 does not contain any qualification, reservation or adverse remark.

In terms of Section 136 of the Act, the Reports and Accounts are being sent to the members and others entitled thereto.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the extract of the Annual Return as at March 31, 2016, in the prescribed form MGT 9, forms part of this report and is annexed as “Annexure IV”.

ENHANCING SHAREHOLDERS VALUE

Your Company believes that its Members are among its most important stakeholders. Accordingly, your Company’s operations are committed to the pursuit of achieving high levels of operating performance and cost competitiveness, consolidating and building for growth, enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its other stakeholders by ensuring that its corporate actions positively impact the socio-economic and environmental dimensions and contribute to sustainable growth and development.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their gratitude to the National Housing Bank, Securities and Exchange Board of India, , Ministry of Corporate Affairs, Registrar of Companies, Financial Intelligence Unit (India), the Company’s Customers, Bankers and other Lenders, Members, and others for their continued support and faith reposed in the Company. The Board also places on record its deep appreciation for the dedication and commitment of the employees at all levels as their hard work, co-operation and support had enabled the Company to maintain its consistent growth. The Directors would also like to thank the BSE Limited, , National Securities Depository Limited, Central Depository Services (India) Limited and the Credit Rating Agencies for their continued co-operation.

CAUTIONARY STATEMENT

Statements in the Board’s Report and the Management Discussion & Analysis describing the Company’s objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company’s operations include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

Registered office For, and on behalf of the Board

AKME Business Center (ABC),

4-5 Subcity Center Savina

Circle Udaipur-313002

Date : 30.08.2016 Mohan Lal Nagda Nirmal Kumar Jain

(Managing Director) (Director)

DIN 00211925 DIN 00240441


Mar 31, 2015

The Members

Akme Star Housing Finance Limited Udaipur

The Directors take pleasure in presenting the 10th Annual Report together with the audited financial statements for the year ended March 31, 2015. The Management Discussion and Analysis has also been incorporated into this report.

HIGHLIGHTS OF PERFORMANCE

The Company has achieved a gross income and net profit of Rs. 201.83 lacs and Rs. 66.69 lacs during the year under review as compared to Rs. 137.47 lacs and Rs. 36.74 lacs in the previous year respectively.

The housing loans/other loan outstanding during the year ended 31st March, 2015 were of Rs. 1232.20 lacs as against Rs. 895.58 lacs during the previous year.

The Net Owned Funds (NOF)/ Net worth of your Company is worth Rs 1538.25 Lacs as on 31.03.2015 as against Rs.1012.91 lacs during the previous year.

The Earnings Per Share (EPS) is Rs. 1.52 as at March 31, 2015 as against Rs. 0.94 as at March 31, 2014.

FINANCIAL RESULTS OF THE COMPANY

The Board's Report shall be prepared based on the stand alone financial statements of the company.

The Financial data for the current year and previous year are to be stated in a summarized form with the details of the appropriation of the credit balance (including the balance brought forward from the previous year).

Particular Rs. In Lacs 2014-15 2013-2014

Total Income 201.83 137.46

Total Expenditure 103.83 83.90

Profit before depreciation 99.74 54.33

Depreciation 1.74 0.77

Profit before Taxation 97.99 53.56

Provision for Taxation 31.30 16.81

Profit after Tax 66.69 36.74

Earnings Per Share 1.52 0.94

Net Owned Funds 1538.24 1012.91

DIVIDEND

To look after the further expansion of business activity and inadequacy of profits your directors do not recommend any payment of dividend for the year ended 31st March, 2015.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, there are no employees of the Company covered under this section who is earning salary over and above specified limit.

AMENDMENT IN MEMORANDUM & ARTICLES OF ASSOCIATION

During the year under review, pursuant to a special resolution passed on September 10, 2015, in the Annual General Meeting, the Members of the Company had approved the adoption of new set of Articles of Association (AOA) of the Company (replacing the existing set of Articles of Association), in conformity with the provisions of the Companies Act, 2013

SHARE CAPITAL

- Authorized Share Capital

The authorized share capital of the Company stood at 6,00,00,000 (divided into 60,00,000 Equity Shares of Rs. 10/- each.

Company has increased its Authorized Capital during the year From Rs 3,00,00,000/- to Rs 6,00,00,000/-.

- Issued and Paid-up Capital

Your Company's Share Capital was at Rs 5.93 crore as at March 31, 2015 as compared to Rs 2.16 crore as at March 31, 2014. The increase was mainly on account of issuance and allotment of following equity shares:

1. Bonus Issue at Ratio of 1:1

2. Company has offered its Shares to the Public by way of IPO during the year.

FINANCE

Cash and cash equivalent as at March 31, 2015 was 402.44 lacs. The Company continues to focus on judicious management of its working capital. Receivables, inventories and other working capital parameters were kept under strict check through continuous monitoring.

DEPOSITS

Your Company has neither accepted nor invited any fixed deposit from the Public during the year under review as per NHB regulations.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013, apart from the loans made, guarantee given or security provided by the Company in the ordinary course of business are given in the Notes to accounts forming part of the Audited Financial Statements for the year ended March 31, 2015.

CREDIT RATING

The Company's borrowings enjoy the following Credit Ratings

CAPITAL ADEQUACY

As required under National Housing Bank Directions, your Company is presently required to maintain a minimum capital adequacy of 12% on a standalone basis. In addition, the National Housing Bank Directions also require that your Company transfers minimum 20% of its annual profits to a reserve fund.

Your Company's Capital Adequacy Ratio is at 133.26 % as at March 31, 2015, which provides an adequate cushion to withstand business risks and is above the minimum requirement of 12% stipulated by the National Housing Bank.

HUMAN RESOURCES AND TRAINING

The Company aims to align HR practices with business goals, motivate people for higher performance and build a competitive working environment. Productive high performing employees are vital to the company's success. The Board values and appreciates the contribution and commitment of the employees towards performance of your Company during the year. In pursuance of the Company's commitment to develop and retain the best available talent, the Company continued to offer in- house training program to staff members in executive development, leadership and management skills. The Company had organized various training programs for upgrading the skill and knowledge of its employees in different operational areas. The Company also sponsored its employees at various levels to attend various seminars and programs conducted by various organizations and institutions including Training programs conducted by the National Housing Bank so as to update their knowledge and to keep them abreast of all the developments in their respective fields.

Employee relations remained cordial and the work atmosphere remained congenial during the year.

DISCLOSURE UNDER SUB-SECTION (3) OF SECTION 134 OF COMPANIES ACT, 2013, READ WITH RULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES, 2014

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows:

- Conservation of energy:

The Company does not fall under any of the industries covered by the Companies (Disclosure of particulars of Directors) Rules, 1988.

- Technology absorption:

The Company is not involved in any technology absorption nor is there any R&D activity during the year

- Foreign Exchange Earnings and Outgo

Your company does not have any foreign exchange earnings and outgo during the year under review.

NATIONAL HOUSING BANK (NHB) GUIDELINES

The Company has complied with the provisions of the Housing Finance Companies (NHB) Directions, 2010 as prescribed by NHB and has been in compliance with the various Circulars, Notifications and Guidelines issued by National Housing Bank (NHB) from time to time. The Circulars and the Notifications issued by NHB are also placed before the Audit Committee / Board at regular intervals to update Committee / Board members on the same.

BUSINESS RISK MANAGEMENT

Pursuant to the requirement of the Listing Agreement, the Company has constituted a Business Risk Management Committee. The details of Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board's Report. The Company has a robust Business Risk Management (BRM) framework to identify, evaluate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on the business objectives and enhance the Company's competitive advantage. The business risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting. The framework has different risk models which help in identifying risks trend, exposure and potential impact analysis at a Company level. . Risk management forms an integral part of the Company's Mid-Term Planning cycle.

During the year, the Board reviewed the risks associated with the business of the Company, its root causes and the efficacy of the measures taken to mitigate the same. The procedures are adopted to assess the risks and their mitigation mechanisms.

ASSET LIABILITY MANAGEMENT COMMITTEE (ALCO)

The Asset Liability Management Committee (ALCO) lays down policies and quantitative limits that involve assessment of various types of risks and shifts in assets and liabilities to manage such risks. ALCO ensures that the liquidity and interest-rate risks are contained within the limits laid down by the Board. The Company has also implemented NHB's Asset Liability Management Guidelines

CODES, STANDARDS & POLICIES KNOW YOUR CUSTOMER & ANTI MONEY LAUNDERING MEASURE POLICY

Your Company has a Board approved Know Your Customer & Anti Money Laundering Measure Policy (KYC & AML Policy) in place and adheres to the said Policy. The said Policy is in line with the National Housing Bank guidelines.

The Company has also adhered to the compliance requirement in terms of the said policy relating to the monitoring and reporting of cash / suspicious transactions. The Company furnishes to Financial Intelligence Unit (FIU), India, in the electronic medium, information of all cash transactions of the value of more than Rupees ten lakh or its equivalent in foreign currency and suspicious transactions whether or not made in cash, in terms of the said Policy.

- Fair Practice Code

Your Company has in place a Fair Practice Code (FPC), which includes guidelines on appropriate staff conduct when dealing with the customers and on the organization's policies vis-a-vis client protection. The FPC captures the spirit of the National Housing Bank guidelines on fair practices for Housing Finance Companies.

During the year under review, FPC was modified by the Board and the grievance redressal mechanism within the Company was further strengthened.

- Code Of Conduct For Board Members And The Senior Management

Your Company has adopted a Code of Conduct for its Board Members and Senior Management personnel. The code requires the directors and employees of the Company to act honestly, ethically and with integrity and in a professional and respectful manner.

The declaration by the Chairman & Managing Director of the Company regarding compliance with the Code of Conduct for Board Members and Senior Management is annexed with the Corporate Governance report.

- Code For Prevention Of Insider Trading Practices

Your Company has formulated and adopted a Code for Prevention of Insider Trading Practices in accordance with the model code of conduct as prescribed under the SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended. The code lays down guidelines, which includes procedures to be followed and disclosures to be made while dealing in the shares of the Company.

The code is applicable to the promoters, directors, senior designated employees and their dependents and the said persons are restricted from dealing in the securities of the Company during the 'restricted trading periods' notified by the Company, from time to time.

- Code Of Business Ethics (COBE)

Your Company has adopted a Code of Business Ethics (COBE) which lays down the principles and standards that govern the activities of the Company and its employees to ensure and promote ethical behavior within the legal framework of the organization.

- Whistle Blower Policy

Your Company believes and is committed to adhere to high ethical standards and compliance with laws and regulations applicable to its business. Company adopted a Whistle Blower Policy which provides for a vigil mechanism that encourages and supports its Directors and employees to report to the management / Chairperson of the Audit Committee instances of unethical behavior, actual or suspected, fraud or violation of the Company's Code of Conduct or Ethics Policy.

The said policy, however, provides for adequate safeguards against the victimization of the Whistle Blower who avail this mechanism. The policy also provides for direct access to the Chairperson of the Audit Committee in exceptional cases.

- Sexual Harassment Policy

The policy on "Workplace Sexual Harassment" was formulated and an Internal Complaints Committee (ICC) was also constituted as per the provisions of "Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The said policy seeks to protect women employees from sexual harassment at the place of work. The primary objective of the same is to safeguard the interest of female employees in the Company and also provides for punishment in case of false and malicious representations.

- Comprehensive Risk Management Policy

Your Company has formulated and adopted a Comprehensive Risk Management Policy which covers a formalized Risk Management Structure, along with other aspects of Risk Management i.e. Credit Risk Management, Operational Risk Management, Market Risk Management and Enterprise Risk Management. The Risk Management Committee of the Board, on periodic basis, oversees the risk management systems, processes and minimization procedures of the Company.

- Corporate Social Responsibility (CSR)

Considering these, the concept of Corporate Social Responsibility (CSR) is the demand of the current era. CSR has become a concept that frequently overlaps similar approaches, such as corporate sustainability, corporate sustainable development and corporate responsibility.

Your Company is a socially responsible organization and always keen to promote the interest of customers, employees, shareholders and communities as a whole.

Our founder chairman's vision and legacy continues to guide our company and our people. Social responsibility is a way of life at AHFL. It means investing in and enriching our communities. It means encouraging employee volunteerism.

Company has constituted a CSR Committee on in Board meeting held on 13th March 2015.

- Remuneration Policy

The Board of Directors had on the recommendation of the Nomination & Remuneration Committee Appointed Mrs. Rajni Gehlot Independent Director as Chairman, Mr. Amrit Singh Rajpurohit and Mr. Avinash Bhatnagar Independent Director as Member.

The Company follow a Policy on remuneration of Directors and senior management Employees, The Policy is approved by the Nomination & Remuneration Committee and the Board.

VIGIL MECHANISM

Fraud free and corruption free work culture has been core to the Company. on view of the potential risk of fraud and corruption due to rapid growth and geographical spread of operations, the company has put an even greater emphasis to address this risk.

The Audit Committee of the Company is also looking for prevent the fraud under the Vigil mechanism for the Company.

LISTING OF SHARES OF THE COMPANY

The Equity Shares of your Company continue to remain listed on the BSE Ltd. and the National Stock Exchange of India Limited. The Company has paid the listing fees as payable to the BSE Ltd. and the National Stock Exchange Limited for the financial year 2013-14.

DIRECTORS AND KEY MANAGERIAL PERSONAL

- Appointment

To meet out the requirement of Companies Act 2013 and SME Listing Agreement Company has appointed Mr. Avinash Bhatnagar as Independent Director in Board of Directors meeting as Additional Director on 15.09.2014.

As an Additional Director, Mr. Avinash Bhatnagar shall hold office up to the date of ensuing General Meeting. The Company has received notice as per section 160 (1) of the Companies Act 2013 from a member proposing her appointment as Director. The Board of Directors recommends his appointment.

Further details about the all directors are given in Corporate Governance report as well as in the Notice of the ensuing General Meeting being sent to the shareholders along with Annual Report

- Appointment of Independent Directors

The Board appointed all the existing Independent Directors viz. Mr. Amrit Singh Rajpurohit and Mrs. Rajni Gehlot as Independent Director under Section 149 of the Companies Act 2013 for a term of Five Years from the 9th Annual general Meeting.

The Shareholder approves their appointment in Annual General Meeting held on 10th September 2014.

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Clause 52of the Listing Agreement

- Retire By Rotation

In accordance with the provisions of section 152 (6) of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Kalu Lal Jain (DIN 00451442) will retire by rotation at the ensuing general meeting of the Company and being eligible offer themselves for re- appointment. The Board recommends their re appointment.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Clause 52 of the SME Listing Agreement, 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 Compliance Committees.

MEETINGS

A calendar of Meetings is prepared and circulated in advance to the Directors. During the year 13 Board Meetings and 4 (Four) Audit Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

RELATED PARTY TRANSACTIONS

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

All Related Party Transactions are placed before the Audit Committee as also the Board for approval. The transactions entered into pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval on a half yearly basis.

SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATOR OR COURT OR TRIBUNALS

There were no significant/material orders passed by any Regulator or Court or Tribunal which would impact the going concern status of the Company and its future operations

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.

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 of the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

The internal audit department also assesses opportunities for improvement in business process systems and controls provides recommendations, designed to add value to the organization and follows up on the implementation of corrective actions and improvements in business process after review by the Audit Committee.

SECRETARIAL AUDITOR & SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed Mr. Ronak Jhuthawat Proprietress of M/s Ronak Jhuthawat & Co., Practicing Company Secretaries, Udaipur, to undertake the Secretarial Audit of the Company for the financial year 2014-15. The Secretarial Audit Report for the financial year ended March 31, 2015, is annexed as "Annexure - A" to this report. The said report, does not contain any qualification, reservation or adverse remark, however, contains certain observations of the Secretarial Auditor which are self explanatory, and thus do not call for any further comments. "Annexure A".

AUDITORS

- Statutory Auditors

The Company's Statutory Auditors, M/s Nyati Mundra & Co. (ICAI Firm Registration No. 08153C ), Chartered Accountants, Udaipur will hold office until the conclusion of the ensuing Annual General Meeting of the Company are eligible for reappointment as per section 139 of the Companies Act 2013.

M/s Nyati Mundra & co have expressed their willingness to get re appointed as the statutory auditors of the company and They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed there under for reappointment as Auditors of the Company. As required under Clause 52 of the SME Listing Agreement, the auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

The Board based on the recommendation of the audit committee recommends the re appointment of M/s Nyati Mundra & co as the statutory Auditor of the Company.

The Members are requested to appoint M/s Nyati Mundra & co Chartered Accountants as Auditors from the conclusion of the ensuing annual general meeting till the Conclusion of the next Annual General Meeting in 2016 and to authorize the Board to fix their remuneration for the year 2015.

- Notes to Accounts and Auditors Report

The notes to the accounts referred to in Auditors Report are self-explanatory and do not call for any further comments. The Statutory Auditors Report does not contain any qualification, reservation or adverse remark.

DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134 (3) (c) of the Companies Act, 2013:

- that in the preparation of the annual financial statements for the year ended March 31, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

- that such accounting policies as mentioned in Note of the Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2015 and of the profit of the Company for the year ended on that date;

- that proper and sufficient care has been taken 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;

- that the annual financial statements have been prepared on a going concern basis;

- that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;

- that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

CORPORATE GOVERNANCE

Pursuant to Clause 52 of the listing agreement with Stock Exchanges, a separate section titled Report on Corporate Governance forms part of this Annual Report. The Report on Corporate Governance also includes certain disclosures that are required, as per Companies Act, 2013.

Auditors' Certificate confirming compliance with the conditions of Corporate Governance as stipulated under Clause 52 of the Listing Agreement also forms part of this Annual Report.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 134 (3) (a) and Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014,the extract of the Annual Return as at March 31, 2015, in the prescribed form MGT 9,forms part of this report and is annexed as "Annexure B ".

ENHANCING SHAREHOLDERS VALUE

Your Company believes that its Members are among its most important stakeholders Accordingly, your Company's operations are committed to the pursuit of achieving high levels of operating performance and cost competitiveness, consolidating and building for growth, enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its other stakeholders by ensuring that its corporate actions positively impact the socio-economic and environmental dimensions and contribute to sustainable growth and development.

ACKNOWLEDGEMENTS

Your Directors thank the various departments like NHB, MCA, Registrar of Companies, various Organizations and Agencies for the continued help and co-operation extended by them. The Directors also gratefully acknowledge all stakeholders of the Company viz. customers, members, dealers, vendors, banks and other business partners for the excellent support received from them during the year. The Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company.

CAUTIONARY STATEMENT

Statements in the Board's Report and the Management Discussion & Analysis describing the Company's objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company's operations include global and domestic demand and supply conditions

affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

Registered office For and on behalf of the Board AKME Business Center 4-5 Subcity Center Savina Circle Udaipur.313002 Sd/- Sd/- Date: 11.07.2015 Mohan Lal Nagda Nirmal Kumar Jain (Managing Director) (Director) DIN 00211925 DIN 00240441

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