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Directors Report of Arrow Coated Products Ltd. Company
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Directors Report of Arrow Coated Products Ltd.

Mar 31, 2015

The Directors of Arrow Coated Products Limited present the 23rdAnnual Report on the operations of the Company, together with the Audited Accounts for the year ended 31st March, 2015.

Financial Results

(Rupees in thousands)

Particulars 2014-2015 2013-2014

Total income 210553 189559

Profit (Loss) before finance cost, Depreciation and Amortization expenses, 102684 65331 exceptional items & Tax

Less : Finance Cost - -

Less : Depreciation and Amortization expenses 8428 3641

Less: Exceptional items 284 88

Profit Before Tax (PBT) 93973 61602

Less : Provision for Taxation

- Current Tax 26500 15600

- Deferred Tax 1968 393

- Fringe Benefit Tax - -

Profit After Tax (PAT) 65505 45609

Add : Balance brought forward 34683 10528

Less : Tax & Dividend Adjustment (34951) (20325)

Less : Tax adjustment of earlier years - (1129)

Less :Adjustment of Depreciation (370) -

Balance carried to Balance Sheet 64866 34683

Operations:

The total income from operations including other income for the financial year under review amounted to Rs.2105.53Lacs as compared to Rs. 1895.59Lacs in the previous year. The Company has incurred net profit of Rs. 655.05Lacs under review after providing for depreciation of Rs. 84.28Lacs and taxation of Rs. 284.68Lacs. After adjustment of brought forward balance of Rs. 346.83Lacs from previous year and after providing for the tax adjustment, Rs. 648.66Lacs has been carried to the Balance Sheet.

Transfer to Reserves

The Board of Directors has not recommended transfer of any amount of profit to reserves during the year under review. Hence, the entire amount of profit for the year under review has been carried to the Profit and Loss account.

Listing of Equity Shares of the Company:-

Your Directors are pleased to inform you that Equity Shares of the Company had listed on the National Stock Exchange of India Limited (NSE) on May 21, 2015 under Scrip Code ARROWCOAT. Now the equity shares of the Company are listed on The Bombay Stock Exchange Limited (BSE) and National Stock Exchange of India Limited (NSE).

Business outlook and future prospects:

Business outlook and future prospects of the Company is discussed in detail in Management Discussion and Analysis Report attached herewith.

Dividend

Your Directors have recommended a dividend of 25% on Equity Shares of the Company for the year ended 31st March, 2015.

Public Deposits

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

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. The details of the investments made by company is given in the notes to the financial statements

Internal control systems and their adequacy:

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is defined in the Internal Audit Manual. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board & 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 report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee of the Board.

Internal Financial Controls

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation were observed.

Corporate Social Responsibility Initiatives

The Corporate Social Responsibility Committee (CSR Committee) has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, which has been approved by the Board.

The CSR Policy may be accessed on the Company's website.

No Annual Report on CSR activities is prepared as it is not applicable for the Company for the FY 2014-15.

Industrial Relations:

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

Directors

Mr. Neil Patel, Whole Time Director of the Company retire by rotation at the ensuring Annual General Meeting and being eligible, offer himself for re-appointment.

Pursuant to Sections 149 , 150 & 152 of the Act, read with Companies (Appointment and qualification of Director) Rules, 2014 along with Schedule IV or re-enactment thereof for the time being in force), the Independent Directors can hold office for a term of Five consecutive years on the Board of your Company. Accordingly, it is proposed to appoint Mr. Haresh Mehta, existing Director as Independent Director for five consecutive years and shall not be liable to retire by rotation.

The Company has received requisite notice along with requisite deposit from a member proposing his candidature for appointment as an Independent Director and has also received declaration from the aforesaid Independent Director confirming that he meets the criteria of Independence as prescribed under provisions of Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement with the Stock Exchanges.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Appointment & Remuneration Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

Meetings

During the year six Board Meetings and 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.

Further, a separate Meeting of the Independent Directors of the Company was also held on 30th March, 2015, whereat the prescribed items enumerated under Schedule IV to the Companies Act, 2013 and clause 49 of the Listing Agreement were discussed.

Audit Committee

The Audit Committee comprises Independent Directors namely of Mr. Harish Mishra and Ms. Suneeta Thakur and Executive Director Mr. Neil Patel . The Chairman of the Committee is Mr. Harish Mishra. All the recommendations made by the Audit Committee were accepted by the Board.

Directors' 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(except AS-24 regarding discontinuance of operations)had been followed along with proper explanation relating to material departures;

ii) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are responsible and prudent so as to give a true and fair view of the state of affairs of the Company for the financial year ended on 31st March, 2015 and of the profit/loss of the Company for the period under review;

iii) the directors had taken proper and sufficient care of 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 had prepared the 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 system to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively.

Declaration by Independent Director(s) and Re-appointment, if any

All the Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

Particulars of Employees and related disclosures

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, will be provided upon request. In terms of Section 136 of the Act, the Report and Financial Statement are being sent to the Members and others entitled thereto, excluding the information on employees' particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.

Related Party Transactions:

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

Vigil Mechanism / Whistle Blower Policy:

The Vigil Mechanism of the Company, which also in corporates a whistle blower policy in terms of the Listing Agreement, includes an Ethics & Compliance Task Force comprising senior executives of the Company. Protected disclosures can be made by a whistle blower through an e-mail, or dedicated telephone line or a letter to the Task Force or to the Chairman of the Audit Committee. The Policy on vigil mechanism and whistle blower policy may be accessed on the Company's website at the link:http://arrowcoated.com/Whistle-Blower- Policy.pdf

Auditors and Auditors' Report

Statutory Auditors

M/s. J. A. Rajani & Co., the Statutory Auditors of the Company will hold office till the ensuing Annual General Meeting. As per provisions of Section 139 of the Companies Act, 2013 read with Companies (Audit and Auditors)Rules, 2014, an audit firm can be appointed as Statutory Auditors of the Company only for two terms each term consisting of five consecutive years. Further, the audit firm which has been occupying the office of auditors of the Company for more than seven years prior to implementation of the Companies Act, 2013, are eligible to hold office for additional three years only.

M/s. J. A. Rajani & Co., the Statutory Auditors of the Company who has already served as auditors of the Company for more than seven years are eligible to hold office of auditors for three years as per provisions of Section 139 of the Companies Act, 2013. Accordingly, M/s. J. A. Rajani & Co, Statutory Auditors of the Company who hold office until the conclusion of the ensuing Annual General Meeting, is proposed to be re-appointed as Statutory Auditors of the Company for the financial year 2015-16. The said Auditor have given a written consent and also issued Certificate pursuant to Section 139 of the Companies Act, 2013.

Auditors' Report

In respect to observations made by the Auditors in their report, your Directors would like to state as under:

1) The Company has discontinued trading activities in Digital Printing Machine and Digital Signage Cutting Machine and the Management of the Company is of opinion that all the assets related Machine Division will be realised at a value at which they appear in the books of account in aggregate.

2) Regarding over due debts aggregating Rs. 3987.876('000) Lacs, the Company is hopeful of total realisation and hence no provision for the same is made.

3) Regarding payment of undisputed statutory due, we state that the company is in process of payment of the same with appropriate authorites

Secretarial Audit:

The Board has appointed M/s Rajendra & Co., Practising Company Secretary, to conduct Secretarial Audit for the financial year 2014- 15. The Secretarial Audit Report for the financial year ended March 31, 2015 is annexed herewith marked as ANNEXURE I to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

Extract of Annual Return:

The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as " ANNEXURE II".

Corporate Governance

Management Discussion and Analysis Report and Report on Corporate Governance along with a certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance, as stipulated under clause 49 of the Listing Agreement with the Stock Exchange, are attached and form part of this Annual Report.

Conservation of Energy, Technology absorption and Foreign Exchange earnings and outgo:

(a) Conservation of Energy and Technology Absorption

(i) The Company has paid special attention to the conservation of energy as a matter of principal and policy. This has been reflected in the selection of equipment at the project stage. The cost of power has kept to the minimum by optimum operation. Regular preventive maintenance has helped to operate unit efficiently.

(ii) Additional investment and proposals, if any, are being implemented for reduction of Conservation of Energy.

(iii) Impact of the measures at (i) and (ii) above for reduction of energy consumption and consequent impact on the cost of production of goods is not ascertainable.

(b) Foreign Exchange earning and outgo

Foreign Exchange earnings - Rs. 1463.41Lacs (previous year Rs. 1511.12Lacs)

Foreign Exchange outgo - Rs. 41.41Lacs (previous year Rs. 63.56Lacs)

Nomination and Remuneration Policy of Directors, Key Managerial Personnel and Other Employees

In adherence of section 178(1) of the Companies Act, 2013, the Board of Directors of the Company in its Meeting held on 11th November, 2014, approved a policy on directors' appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a director and other matters provided u/s 178(3), based on the recommendations of the Nomination and Remuneration Committee. The broad parameters covered under the Policy are – Company Philosophy, Guiding Principles, Nomination of Directors, Remuneration of Directors, Nomination and Remuneration of the Key Managerial Personnel (other than Managing/ Whole-time Directors), Key-Executives and Senior Management and the Remuneration of Other Employees.

Subsidiary Companies and Consolidated Financial Statements:

The Ministry of Corporate Affairs (MCA) vide General Circular No. 2/2011 No.51/12/2007-CL-III dated 8th February 2011read with General Circular No.3/2011 No. 5/12/2007-CL-III dated 21stFebruary 2011 has granted a general exemption from attaching the Balance Sheet of Subsidiary Companies with holding Company's Balance Sheet, if the holding Company presents in its Annual Report the Consolidated Financial Statements duly audited by its Statutory Auditors. The Company is publishing Consolidated Financial Statements in the Annual Report and accordingly, the Company is not attaching the Balance Sheets of the subsidiary Companies.

Further as required under the said circular, a statement of financial information of the Subsidiary Companies viz., Arrow Coated Products (UK) Ltd. and Arrow Secure Technology Pvt. Ltd. and step down subsidiary companies viz,. Advance IP Technologies Ltd. and Arrow Realty Ltd.(subsidiary of Arrow Coated Products (UK) Ltd.) is attached in Form No. AOC-1 in ANNEXURE III to this report.

The annual accounts of the above referred subsidiaries and step down subsidiary company shall be made available to the share holders of the company on request and will also be kept open for inspection at the Registered Office of the Company during the office hours on all working days and during the Annual General Meeting and also on the Company's website i.e. www.arrowcoated.com.

General

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

1. 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.

2. The Company does not have any Risk Management Policy as the elements of risk threatening the Company's existence is very minimal.

3. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future.

4. Your Directors further state that 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.

Acknowledgements:

Your Directors would like to express their grateful appreciation for the assistance and co-operation received from the Financial Institution, Banks, Government Authorities, Vendors and Shareholders and all organizations connected with its business during the year under review. Your Directors also wish to place a record their deep sense of appreciation for the committed services of Executives, Staff and Workers of the Company.



For and on behalf of the Board of Directors



Place: Mumbai Shilpan P. Patel

Date: 29th May 2015 Chairman & Managing Director

DIN: 00341068


Mar 31, 2014

Dear Members,

The Directors of Arrow Coated Products Limited present the 22nd Annual Report on the operations of the Company, together with the Audited Accounts for the year ended 31st March, 2014.

Financial Results (Rs. in ''000)

Particulars 2013-2014 2012-2013

Total income 189559 106599

Profit (Loss) before finance cost, Depreciation and Amortization expenses, exceptional items & Tax 65331 21726

Less : Finance Cost - 1727

Less : Depreciation and Amortization expenses 3641 2497

Less: Exceptional items 88 364

Profit Before Tax (PBT) 61690 17138

Less : Provision for Taxation

- Current Tax 15600 440 - Deferred Tax 393 376 - Fringe Benefit Tax - -

Profit After Tax (PAT) 45609 16322

Add : Balance brought forward 10528 4643 Less : Tax & Dividend Adjustment (20325) (10437) Less : Tax adjustment of earlier years (1129) -

Balance carried to Balance Sheet 34683 10528

Operations:

The total income from operations including other income for the financial year under review amounted to Rs. 1895.59 Lacs as compared to Rs. 1065.99 Lacs in the previous year. The Company has incurred net profit of Rs. 456.09 Lacs under review after providing for depreciation of Rs. 36.41 Lacs and taxation of Rs. 159.93 Lacs. After adjustment of brought forward balance of Rs. 105.28 Lacs from previous year and after providing for the tax adjustment, Rs. 346.83 Lacs has been carried to the Balance Sheet.

Business outlook and future prospects:

Business outlook and future prospects of the Company is discussed in detail in Management Discussion and Analysis Report attached herewith.

Dividend

Your Directors have recommended a dividend of 15% on Equity Shares of the Company for the year ended 31st March, 2014.

Public Deposits

During the year under review, the Company has not accepted/renewed any deposits from the public within the meaning of Section 58A and 58AA of the Companies Act, 1956.

Directors

Mr. Haresh Mehta, Director of the Company retire by rotation at the ensuring Annual General Meeting and being eligible, offer himself for re-appointment.

Pursuant to Section 149, 150 and 152 of the Act, read with Companies (Appointment and Qualification of Director) Rules, 2014 along with Schedule IV or re-enactment there of further time being inforce, the Independent Directors can hold office for a term of five consecutive years on the Board of your Company. Accordingly, it is proposed to appoint Mr. Harish Mishra, existing director as independent director for five consecutive years and shall not be liable to retire by rotation.

The Company has received requisite notice from a member proposing his candidature for appointment as an independent director and has also received declaration from the aforesaid independent director confirming that he meet the criteria of independence as prescribed under the provisions of Section 149 (6) of the Companies Act, 2013 and clause 49 of the Listing Agreement with the Stock Exchanges.

Subject to approval of the shareholders, the Board of Directors at its meeting held on 3rd May, 2014 and as per the recommendation of Nomination &Remuneration Committee, re-appointed Mr. Shilpan Patel as Managing Director & Mr. Neil Patel as Whole Time Director for the period of 3 (three) years w.e.f. 1st April, 2014.

During the year, Mr. Faredun Tarapoorwala & Mr. Vijay Dhar resigned from the Board of Directors of the Company, on 20th July 2013 & 25th January 2014 respectively. The Board places on record their appreciation for their contribution in the overall growth of the Company during their tenure as Director.

Directors'' Responsibility Statement

In accordance with the provisions of Section 217(2AA) of The Companies Act, 1956, your Directors confirm that:

i) in the preparation of the annual accounts, the applicable Accounting Standards (except AS-24 regarding discontinuance of operations) had been followed along with proper explanation relating to material departures;

ii) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are responsible and prudent so as to give a true and fair view of the state of affairs of the Company for the financial year ended on 31st March, 2014 and of the profit/loss of the Company for the period under review;

iii) the directors had taken proper and sufficient care of 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 had prepared the accounts on a going concern basis.

Corporate Governance

Management Discussion and Analysis Report and Report on Corporate Governance along with a certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance, as stipulated under clause 49 of the Listing Agreement with the Stock Exchange, are attached and form part of this Annual Report.

Auditors

M/s. J. A. Rajani & Co., the Statutory Auditors of the Company will hold office till the ensuing Annual General Meeting. As per provisions of Section 139 of the Companies Act, 2013 read with Companies (Audit and Auditors) Rules, 2014, an audit firm can be appointed as Statutory Auditors of the Company only for two terms each term consisting of five consecutive years. Further, the audit firm which has been occupying the office of auditors of the Company for more than seven years prior to implementation of the Companies Act, 2013, are eligible to hold office for additional three years only.

M/s. J. A. Rajani & Co., the Statutory Auditors of the Company who has already served as auditors of the Company for more than seven years are eligible to hold office of auditors for three years as per provisions of Section 139 of the Companies Act, 2013. Accordingly, M/s. J. A. Rajani & Co, Statutory Auditors of the Company who hold office until the conclusion of the ensuing Annual General Meeting, is proposed to be re-appointed as Statutory Auditors of the Company for the financial year 2014-15. The said Auditor have given a written consent and also issued Certificate pursuant to Section 139 of the Companies Act, 2013.

Auditors'' Report

In respect to observations made by the Auditors in their report, your Directors would like to state as under:

1) The Company has discontinued trading activities in Digital Printing Machine and Digital Signage Cutting Machine and the Management of the Company is of opinion that all the assets related Machine Division will be realised at a value at which they appear in the books of account in aggregate.

2) Regarding over due advances aggregating Rs. 20616.610(''000) Lacs, the Company is hopeful of total realisation and hence no provision for the same is made.

3) Regarding payment of undisputed statutory due, we state that the company is in process of payment of the same with appropriate authorites

Particulars of Employees as per Section 217(2A) of Companies Act, 1956

During the year under review, none of the employees of the Company was in receipt of remuneration equal to or exceeding the limits prescribed under Section 217(2A) of the Companies Act, 1956 and Rules there under.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:

(a) Conservation of Energy and Technology Absorption

(i) The Company has paid special attention to the conservation of energy as a matter of principal and policy. This has been reflected in the selection of equipment at the project stage. The cost of power has kept to the minimum by optimum operation. Regular preventive maintenance has helped to operate unit efficiently.

(ii) Additional investment and proposals, if any, are being implemented for reduction of Conservation of Energy.

(iii) Impact of the measures at (i) and (ii) above for reduction of energy consumption and consequent impact on the cost of production of goods is not ascertainable.

Employees'' Stock Options:

Your Company had introduced an employee stock option plan framed in accordance with SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999, titled Arrow Employees Stock Option Plan 2007 during the financial year 2006-07. According to the scheme the Options granted should be exercised within a period of 3 years from the date of Vesting.

Your Company had introduced an employee stock option plan vide resolution dated 27th February 2007 was approved by the shareholders in an Extra Ordinary General Meeting and an ESOP scheme was prepared to benefit the employees of the Company. According to the scheme the Options granted should be exercised within a period of 3 years from the date of Vesting.

83550 number of Option has been lapsed during the year and an amount of Rs. 22,22,430/- has been written off.

Subsidiary Companies and Consolidated Financial Statements:

The Ministry of Corporate Affairs (MCA) vide General Circular No. 2/2011 No. 51/12/2007-CL-III dated 8th February 2011 read with General Circular No.3/2011 No. 5/12/2007-CL-III dated 21st February 2011 has granted a general exemption from attaching the Balance Sheet of Subsidiary Companies with holding Company''s Balance Sheet, if the holding Company presents in its Annual Report the Consolidated Financial Statements duly audited by its Statutory Auditors. The Company is publishing Consolidated Financial Statements in the Annual Report and accordingly, the Company is not attaching the Balance Sheets of the subsidiary Companies.

Further as required under the said circular, a statement of financial information of the Subsidiary Company viz., Arrow Coated Products (UK) Ltd. and Arrow Secure Technology Pvt. Ltd. (formerly known as NagraID Arrow Secure Cards Pvt. Ltd.) and step down subsidiary company viz,. Advance IP Technologies Ltd. and Arrow Reality Limited (subsidiaries of Arrow Coated Products (UK) Ltd.) is attached to this report.

The annual accounts of the above referred subsidiaries and step down subsidiary company shall be made available to the share holders of the company and of the subsidiary companies on request and will also be kept open for inspection at the Registered Office of the Company and of the subsidiary companies during the office hours on all working days and during the Annual General Meeting.

Acknowledgments:

Your Directors would like to express their grateful appreciation for the assistance and co-operation received from the Financial Institution, Banks, Government Authorities, Vendors and Shareholders and all organizations connected with its business during the year under review. Your Directors also wish to place a record their deep sense of appreciation for the committed services of Executives, Staff and Workers of the Company.

For and on behalf of the Board of Directors

Place: Mumbai Shilpan P. Patel Date : 3rd May 2014 Chairman & Managing Director DIN: 00341068


Mar 31, 2013

To, The Members,

The Directors of Arrow Coated Products Limited present the 21st Annual Report on the operations of the Company, together with the Audited Accounts for the year ended 31st March, 2013.

Financial Results (Rs. In''000)

Particulars 2012-2013 2011-2012

Total income 105835 44286

Profit (Loss) before finance cost, Depreciation and Amortization 21726 (3580) expenses, exceptional items & Tax

Less : Finance Cost 1727 3560

Less : Depreciation and Amortization expenses 2497 2233

Less: Exceptional items 364 (423)

Profit Before Tax (PBT) 17138 (8950)

Less : Provision for Taxation

- Current Tax 440

- Deferred Tax 376 140

- Fringe Benefit Tax

Profit After Tax (PAT) 16322 (9090)

Add : Balance brought forward 4643 14202

Less : Tax & Dividend Adjustment (10437) (252)

Balance carried to Balance Sheet 10528 4643

Operations :

The total income from operations including other income for the financial year under review amounted to Rs. 1058.35 Lacs as compared to Rs. 442.86 Lacs in the previous year. The Company has incurred net profit of Rs. 163.22 Lacs under review after providing for depreciation of Rs. 24.97 Lacs and taxation of Rs. 8.16 Lacs. After adjustment of brought forward balance of Rs. 46.43 Lacs from previous year and after providing for the tax adjustment, Rs. 105.28 Lacs has been carried to the Balance Sheet.

Business outlook and future prospects

Business outlook and future prospects of the Company is discussed in detail in Management Discussion and Analysis Report attached herewith.

Dividend

Your Directors have recommended a dividend of 7.5% on Equity Shares of the Company for the year ended 31st March, 2013

Conversion of Detachable Warrants into Equity Shares

During the year under review, the Company has allotted 10,39,552 fully paid-up Equity Shares of face value of Rs. 10/- each on 9th March, 2013 against conversion of detachable warrants issued by the Company on 16th March 2012. The above shares were listed on BSE Ltd. on 23rd April, 2013.

Consequent to the above, the paid-up Equity Share capital of the Company is increased to Rs. 11,73,99,480/- divided into 1,17,39,948 Equity Shares of Rs. 10/- each.

Public Deposits

During the year under review, the Company has not accepted/renewed any deposits from the public within the meaning of Section 58A and 58AA of the Companies Act, 1956.

Directors

Mr. Haresh Mehta and Dr. Anil Saxena, Directors of the Company retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

Your Directors recommend re-appointment of Mr. Haresh Mehta and Dr. Anil Saxena as Directors of the Company at the ensuing Annual General Meeting of the Company.

Directors'' Responsibility Statement

In accordance with the provisions of Section 217(2AA) of The Companies Act, 1956, your Directors confirm that:

i) in the preparation of the annual accounts, the applicable Accounting Standards (except AS-24 regarding discontinuance of operations) had been followed along with proper explanation relating to material departures;

ii) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are responsible and prudent so as to give a true and fair view of the state of affairs of the Company for the financial year ended on 31 st March, 2013 and of the loss of the Company for that year;

iii) the directors had taken proper and sufficient care of 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 had prepared the accounts on a going concern basis.

Corporate Governance

Management Discussion and Analysis Report and Report on Corporate Governance alongwith a certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance, as stipulated under clause 49 of the Listing Agreement with the Stock Exchange, are attached and form part of this Annual Report.

Auditors

M/s. J. A. Rajani & Co., Chartered Accountants, Statutory Auditors of the Company holds office upto the conclusion of ensuing Annual General Meeting and being eligible offered for re-appointment. The Company has received a letter from them to the effect that their re-appointment, if made, would be within the prescribed limits under Section 224(1B) of the Companies Act, 1956. Members are requested to consider the re-appointment of the Statutory Auditors and fix their remuneration.

Auditors'' Report

In respect to observations made by the Auditors in their report, your Directors would like to state as under:

1) The Company has discontinued trading activities in Digital Printing Machine and Digital Signage Cutting Machine and the Management of the Company is of opinion that all the assets related Machine Division will be realised at a value at which they appear in the books of account in aggregate.

2) Regarding over due debts aggregating Rs. 137.20 Lacs and advances aggregating Rs. 315.01 Lacs, the Company is hopeful of total realisation and hence no provision for the same is made.

3) Regarding payment of undisputed statutory due, we state that the company is in process of payment of the same with appropriate authorites

Particulars of Employees as per Section 217(2A) of Companies Act, 1956

During the year under review, none of the employees of the Company was in receipt of remuneration equal to or exceeding the limits prescribed under Section 217(2A) of the Companies Act, 1956 and Rules there under.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:

(a) Conservation of Energy and Technology Absorption

(i) The Company has paid special attention to the conservation of energy as a matter of principal and policy. This has been reflected in the selection of equipment at the project stage. The cost of power has kept to the minimum by optimum operation. Regular preventive maintenance has helped to operate unit efficiently.

(ii) Additional investment and proposals, if any, are being implemented for reduction of Conservation of Energy.

(iii) Impact of the measures at (i) and (ii) above for reduction of energy consumption and consequent impact on the cost of production of goods is not ascertainable.

(b) Foreign Exchange earning and outgo

Foreign Exchange earnings - Rs. 652.91 Lacs (previous year Rs. 66.97 Lacs)

Foreign Exchange outgo - Rs. 85.10 Lacs (previous year Rs. 158.26 Lacs)

Employees'' Stock Options:

Details as required under Clause 12 of the SEBI (Employee Stock Option Scheme & Employee Stock Purchase Scheme) Guidelines, 1999, are given in annexure attached to this report.

Subsidiary Companies and Consolidated Financial Statements:

The Ministry of Corporate Affairs (MCA) vide General Circular No. 2/2011 No. 51/12/2007-CL-III dated 8th February 2011 read with General Circular No.3/2011 No. 5/12/2007-CL-III dated 21st February 2011 has granted a general exemption from attaching the Balance Sheet of Subsidiary Companies with holding Company''s Balance Sheet, if the holding Company presents in its Annual Report the Consolidated Financial Statements duly audited by its Statutory Auditors. The Company is publishing Consolidated Financial Statements in the Annual Report and accordingly, the Company is not attaching the Balance Sheets of the subsidiary Companies.

Further as required under the said circular, a statement of financial information of the Subsidiary Company viz., Arrow Coated Products (UK) Ltd. and NagraID Arrow Secure Cards Pvt. Ltd. and step down subsidiary company viz,. Advance IP Technologies Ltd. (subsidiary of Arrow Coated Products (UK) Ltd.) is attached to this report.

The annual accounts of the above referred subsidiaries and step down subsidiary company shall be made available to the share holders of the company and of the subsidiary companies on request and will also be kept open for inspection at the Registered Office of the Company and of the subsidiary companies during the office hours on all working days and during the Annual General Meeting and also on the Company''s website i.e. www.arrowcoated.com.

Acknowledgements:

Your Directors would like to express their grateful appreciation for the assistance and co-operation received from the Financial Institution, Banks, Government Authorities, Vendors and Shareholders and all organizations connected with its business during the year under review. Your Directors also wish to place a record their deep sense of appreciation for the committed services of Executives, Staff and Workers of the Company.

For and on behalf of the Board of Directors

Place: Mumbai Shilpan P. Patel

Date: 28th May 2013 Chairman & Managing Director


Mar 31, 2010

The Directors of Arrow Coated Products Limited present the 18th Annual Report on the operations of the Company, together with the Audited Accounts for the year ended31- March 2010.

Financial Results

(Rupees in thousands)

Particulars 2009-2010 2008-2009

Total income 21,765 46,329

Profit (Loss) before interest, Depreciation & Tax (2,204) 2,609

Less: Interest 3,287 3,431

Less: Depreciation 2,538 3,112

Less: Prior period expenses 31 57

Profit before Tax (8,060) (3,991)

Less: Provision for Taxation

-Current Tax

-Deferred Tax 696 (692)

-Fringe Benefit Tax - 185

Profit after Tax (8,756) (3,484)

Add: Balance brought forward 24,163 28,534

Less: Tax & Dividend Adjustment - 887

Amount available for appropriation 15,407 24,163

Less: Proposed Dividend

Less: Tax on Dividend

Balance carried to Balance Sheet 15,407 24,163



Operations

The total income from operations including other income for the financial year under review amounted to Rs. 217.64 Lacs as compared to Rs. 463.29 Lacs in the previous year. The Company has incurred net loss of Rs. 87.58 Lacs during the year under review after providing for depreciation of Rs. 25.38 Lacs and taxation of Rs. 696 Lacs. After adjustment of brought forward balance of Rs. 241.63 Lacs from previous year Rs. 154.05 Lacs has been carried to the Balance Sheet.

Business outlook and future prospects

Business outlook and future prospects of the Company is discussed in detail in Management Discussion and Analysis Report attached herewith.

Dividend

In view of the loss during the year, your Directors do not recommend any dividend for the year ended 31st March 2010.

Directors

Mr. Faredun Homi Taraporwala and Mr. Vijay Dhar, Directors of the Company retire by rotation at the ensuing Annual General Meeting and being eligible, have offered themselves for re-appointment. Your Board recommends the re-appointment of Mr. Faredun Homi Taraporwala and Mr. Vijay Dhar as directors of the Company.

Directors Responsibility Statement

In accordance with the provisions of Section 217(2AA) of Companies Act, 1956, your Directors confirm that:

i) in the preparation of the annual accounts, the applicable Accounting Standards (except AS-24 regarding discontinuance of operations) had been followed along with proper explanation relating to material departures;

ii) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are responsible 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 loss of the company for that year;

iii) the directors had taken proper and sufficient care of the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Companyandforpreventinganddetectingfraudandotherirregularities;

iv) the directors had prepared the accounts on a going concern basis.

Corporate Governance

Management Discussion and Analysis Report and Report on Corporate Governance alongwith a certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance, as stipulated under clause 49 of the Listing Agreement with the Stock Exchange, are attached and form part of this Report.

Auditors

M/s. J. A. Rajani & Co., Chartered Accountants, Statutory Auditors of the Company holds office upto the conclusion of ensuring Annual General Meeting and being eligible offered for re-appointment. The Company has received a letter from them to the effect that their re- appointment, if made, would be within the prescribed limits under Section 224(1 B) of the Companies Act, 1956. Members are requested to consider the re-appointment of the Statutory Auditors and fix their remuneration.

Auditors Report

In respect to observations made by the Auditors in their report, your Directors would like to state as under:

1) During the year 2008-09, the company discontinued trading activities in Digital Printing Machine and Digital Signang Cutting Machine and the Management of the Company is of opinion that all the asset related Machine Division will realised at a Value at which they appear in the books of account in aggregate.

2) Regarding over due debts aggregating Rs. 377.05 Lacs and advances aggregating Rs. 84.10 Lacs the Company is hopeful of total realisation, and hence no provision for the same is made.

3) Regarding payment of undisputed statutory due, and we state that the company is in process of payment of the same with appropriate authorities.

4) Regarding non payment of income tax of Rs. 5.33 lacs pertaining to assessment year 2006-07, we state that the company has appealed before the CIT (Appeals) to challenge the demand.

Audit Committee

Pursuant to the provisions of Section 292A of the Companies Act, 1956 and Clause 49 of the Listing Agreement, the Company has constituted an Audit Committee comprising of Mr. Faredun H. Taraporwala, Mr. Vijay Dhar and Mr. Haresh Mehta. Mr. Faredun H. Taraporwala is Chairman of the Audit Committee.

Particu lars of Employees as per Section 217(2A) of Companies Act, 1956

During the year under review, none of the employees of the Company was in receipt of remuneration equal to or exceeding the limits prescribed under Section 217(2A) of the Companies Act, 1956 read with Company.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:

(a) Conservation of Energy and technology absorption

(i) The Company has paid special attention to the conservation of energy as a matter of principal and policy. This has been reflected in the selection of equipment at the project stage. The cost of power has kept to the minimum by optimum operation. Regular preventive maintenance has helped to operate unit efficiently.

(ii) Additional investment and proposals, if any, are being implemented for reduction of Conservation of Energy.

(iii) Impact of the measures at (i) and (ii) above for reduction of energy consumption and consequent impact on the cost of production ofgoods:Notascertainable

(b) Foreign Exchange earning and outgo

Foreign Exchange earnings - Rs. 17.52 Lacs (previous year Rs. 4.76 Lacs)

Foreign Exchange outgo - Rs. 6.87 Lacs (previous year Rs. 37.55 Lacs)

Employees Stock Options:

Details as required under Clause 12 of the SEBI (Employee Stock Option Scheme & Employee Stock Purchase Scheme) Guidelines, 1999, are given in annexure attached to this report.

Subsidiary companies:

Arrow Coated Products (UK) Ltd., NagralD Arrow Secure Cards Pvt. Ltd. and Advance IP Technologies Ltd. (step down) are subsidiary companies of the Company. As required under Section 212 of the Companies Act, 1956, a statement regarding subsidiary companies is attached to the Balance Sheet for the year ended 31st March 2010.

As required by under Accounting Standard 21, the Audited Consolidated Financial Statements for the above referred subsidiary companies are attached herewith and form part of the Annual Report.

Acknowledgements:

Your Directors would like to express their grateful appreciation for the assistance and co-operation received from the Financial Institution, Banks, Government Authorities, Vendors and Shareholders and all organizations connected with its business during the year under review. Your Directors also wish to place a record their deep sense of appreciation for the committed services of Executives, Staff and Workers of the Company.

For and on behalf of the Board of Directors

Place: Mumbai Shilpan Patel

Date: 29th May 2010 Chairman & Managing Director




Mar 31, 2001

The Directors take pleasure in presenting the 8th Annual Report together with the Audited statement of accounts for the year ended 31st March,2001.

(Rs. in lacs) FINANCIAL RESULTS 2001 2000

1) Sales including excise and other income 674.51 751.27

2) Profit before interest,Depreciation & Tax (32.76) (39.85) Less 3) Interest 25.08 25.47 Less 4) Depreciation 22.93 26.44

5) Profit before Tax (80.77) (91.76)

6) Profit after tax (80.77) (91.76) Add Balance brought forward from previous year 173.95 159.39 Balance Profit to be carried forward 93.18 173.95

OPERATIONS :-

The overall perfromance in terms of production and capacity utilisation has shown consistent improvements in all the divisions of the company. Your directors are pleased to inform you that your company has achieved a total gross income of Rs.674.51 lacs for the current year as against Rs.751.27 lacs for the previous year.

FOREIGN COLLABORATION

Yours directors are pleased to infrom you that M/s FOILMARK INC.,U.S.A.,your technical collaborators, is providing timely technical assistance to the company in updating the process of manufacturing Hot Stamping Foil.

DIRECTORS

Mr.Snehal P. Patel and Mr. Haresh Mehta retire by rotation and being eligible, offers themselves for re-appointment.

AUDITORS

M/s.J.A.Rajani & Co., Chartered Accountants retired and being eligible, offer themselves for re-appointment.

COMPANIES (Disclosure of Particulars in the report of Board of Directors) RULES 1988.

In terms of the above Rules, your Board is pleased to give the particulars as prescribed there in the Annexure which forms part of the Directors Report.

INDUSTRIAL RELATIONS

Industrial relations continued to be cordial during the year under review.

APPRECIATION

Your directors wish to place on record their appreciation of the valuable services rendered by all the employees of the company and to State Bank of India, for the timely assistance and to companys customers, distributors,suppliers and share holders for their continued support.

For and on behalf of the Board of Directors

SHILPANP.PATEL

Chairman & Managing Director

 
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