Home  »  Company  »  R&B Denims Ltd.  »  Quotes  »  Directors Report
Enter the first few characters of Company and click 'Go'

Directors Report of R&B Denims Ltd.

Mar 31, 2023

The Directors take pleasure in submitting the 13th Annual Report of the Business and operations of your Company and the Audited Financial Statements for the financial year ended 31st March, 2023.

1. FINANCIAL RESULTS & PERFORMANCE

(Rs. in Lakhs)

Particulars

For the year ended

For the year ended

31-03-2023*

31-03-2022*

Revenue from operations

1

27,609.43

29,623.52

Other Income

252.97

109.34

Total Revenue

n

27,862.40

29,732.86

Profit before tax and Exceptional Items

1,766.23

2,662.89

Exceptional Items

225.49

143.04

Profit before Taxation

1,991.73

2,805.93

-Current Tax

n

(374.13)

(487.16)

-Deferred Tax

(126.64)

(211.29)

-Short Provision for Income Tax

--

(4.69)

expense relating to prior Year

Net Profit/ (Loss) For The Year

1,490.95

2,111.52

Other Comprehensive Income for

7.69

5.58

the Year, Net of Tax

Total Comprehensive Income for the Year

1,498.64

2,117.10

* Figures regrouped wherever necessary

The Company discloses financial results on quarterly basis of which results are subjected to limited review and publishes audited financial results on an annual basis. The Financial Statements as stated above are also available on the Company''s website www.rnbdenims.com.

2. STATE OF COMPANY''S AFFAIR

During the year, Your Company recorded total revenue of 27,862.40 Lacs against Rs. 29,732.86 Lacs in the previous year, representing a decrease of 6.29% during the year and Profit before Tax Rs. 1,991.73 Lacs as compared to Rs. 2,805.93 Lacs during the year. Total Income during the year Rs. 1,498.64 as compared to Rs. 2,117.10 in the previous year. A detailed analysis on the Company''s performance is included in the "Management''s Discussion and Analysis" Report, which forms part of this Report.

3. ROAD AHEAD

Our vision of becoming one of the top quality denim manufacturer and moving towards sustainable growth. Our priorities are as follows:

• Focus on increasing production

• Maintaining Price Competitiveness

• Moving up the value chain - Expanding the product line under own brand

We are very excited to enter into the new phase of growth and will continue to invest in our capabilities to increase our presence prudently and create value for the shareholders. We would like to be thankful to the entire stakeholder for being part of the journey.

4. DIVIDEND

Keeping in mind the overall performance and outlook for your Company, your Board of Directors recommend that this time the company is not declaring dividends as the company requires funds for its business expansion. Your Directors are unable to recommend any dividend for the year ended 31st March, 2023.

5. UNCLAIMED DIVIDEND

There is no balance lying in unpaid equity dividend account.

6. TRANSFER TO RESERVE

Company has not transferred any amount from profit to General Reserve.

7. MATERIAL CHANGES

There are no Material changes occurred between the end of the financial year of the company to which the financial statements related and the date of the report, which is affecting the financial position of the company.

8. SHARE CAPITAL

The Authorized Share Capital of the Company as on 31/03/2023 was Rs. 25,50,00,000 and Paid up share capital of the Company as on 31/03/2023 was Rs. 13,99,46,880. There has been no such change in the Equity Share Capital of the Company during the year.

9. DEPOSITS

During the year, Company has not accepted any deposits from public within the meaning of the Section 73 of the Companies Act, 2013.

10. ANNUAL RETURN

Annual Return Pursuant to Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013, the Annual Return as on the financial year ended March 31, 2023 is placed on the Company''s website at https://www.rnbdenims.com/annual-return.html

11. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY''S OPERATIONS IN FUTURE

There was no significant material order passed by the regulators or courts or tribunals impacting the going concern status and company''s operation in nature.

12. DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with Section 152(6) of the Companies Act, 2013 read with the Articles of Association of the Company, Mr. Amit Dalmia (DIN: 00034642), Whole Time Director, retire by rotation and is being eligible has offered himself for re-appointment at the ensuing Annual General Meeting.

Based on the confirmations received from Directors, none of the Directors are disqualified from appointment under Section 164 of the Companies Act, 2013.

The following are the List of Directors and KMP of the Company during the year:

Name of Directors

Category &

Appointment

Resignation

Designation

Date

date

Mr. Rajkumar Borana

Executive Managing

17/11/2010

-

Director

Mr. Amit Dalmia

Executive Whole Time Director

17/11/2010

-

Mr. Deepak Dalmia

Executive Whole Time

17/11/2010

-

Director

Mr. Ankur Borana

Executive Whole Time Director

17/11/2010

-

Mr. Girish Kalawatia

Non-Executive

03/01/2014

-

Independent Director

Mr. Manaklal Tiwari

Non-Executive Independent Director

03/01/2014

-

Mr. Dharmesh Mehta

Non-Executive

03/01/2014

-

Independent Director

Mrs. Anita Jain *

Non-Executive Independent Director

23/03/2023

-

Mr. Parkin K. Jariwala

Chief Financial Officer

19/03/2019

-

Mrs. Jyoti Agarwal

Company Secretary

21/12/2015

-

* Note: The Term/Tenure of Mrs. Anita Pankaj Jain (DIN: 08010993) as Women Independent Director has been completed on 27th December, 2022. The company appointing her again as an Additional Independent Director and filled-up the vacancy within three months from the date of such vacancy and who shall hold office upto the date of the ensuing general meeting.

13. STATUTORY AUDITORS

M/s. Pradeep K. Singhi & Associates, Chartered Accountants (having Firm Registration No 126027W) are Statutory Auditors of the Company, who were appointed in 10th Annual General Meeting held on 09.09.2019 holds office until the conclusion of the 14th Annual General Meeting.

14. COMMENTS ON AUDITOR''S REPORT

The notes referred to in the Auditor Report are self-explanatory and they do not call for any further explanation as required under section 134 of the Companies Act, 2013.

15. INTERNAL AUDITOR

M/s. Shivangi Parekh & Co., Chartered Accountant, Surat appointed as an internal Auditor of the Company for the Financial Year 2022-23. Internal Auditors are appointed by the Board of Directors of the Company, based on the recommendation of the Audit Committee. The Internal Auditor reports their findings on the internal Audit of the Company to the Audit Committee on a quarterly basis. The Scope of Internal audit is approved by the Audit Committee.

The Company has appointed M/s. Shivangi Parekh & Co., Chartered Accountant, Surat as an Internal Auditor for F.Y. 2022-23 in the Board meeting held on 8th June, 2021 after obtaining her willingness and eligibility letter for appointment as Internal Auditor of the Company.

16. COST AUDITOR

M/s. V. M. Patel & Associates, Cost Accountant, Surat appointed as a Cost Auditor of the Company for the Financial Year 2022-23 in the Board meeting held on 29th April, 2022 after obtaining his willingness and eligibility letter for appointment as Cost Auditor of the Company.

17. RELATED PARTY TRANSACTION

With reference to Section 134(3)(h) of the Companies Act, 2013, all contracts and arrangements with related parties under section 188 of the Companies Act, 2013 entered by the Company during the financial year, were in ordinary course of business and at arm''s length basis. Details of the related party transactions made during the year are attached as Annexure-1 in form AOC-2 for your kind perusal and information.

18. NUMBER OF MEETING HELD DURING THE YEAR

The Details of all meeting of Board of Directors and Committee meeting had taken place during the year and their details along with their attendance, is given in Annexure 2 in the Corporate Governance Report.

19. COMPOSITION OF BOARD AND ITS COMMITTEE

The detail of the composition of the Board and its committees thereof and detail of the changes in their composition if any is given in Annexure 2 in the Corporate Governance Report.

20. LOANS, GUARANTEES AND INVESTMENT

With reference to Section 134(3)(g) of the Companies Act, 2013, loans, guarantees and investments made under section 186 of the Companies Act, 2013 form part of the Notes to the financial statements provided in this Annual Report.

21. DECLARATION BY INDEPENDENT DIRECTORS

Company has received declaration from all the independent directors duly signed by them stating that they meet the criteria of independence as provided in section 149(6) of the Companies Act, 2013.

There has been no Change in the circumstances affecting their status as Independent Directors of the Company so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant regulations.

All the independent directors have enrolled with the Indian Institute of Corporate Affairs at Manesar.

SEPARATE MEETING OF INDEPENDENT DIRECTORS

In terms of requirement of Schedule IV of the Companies Act, 2013, the Independent Directors of the company have complied with the code of Independent Director. Independent Directors met separately on 23rd March, 2023 to inter alia review the performance of Non-Independent Directors (Including the Chairman), the entire Board and the quality, quantity and timeliness of the flow of the information between the Management and the Board.

22. VIGIL MECHANISM

The Company has adopted a Whistle Blower Policy to provide a formal mechanism to the Directors and employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Company''s Code of Conduct or Ethics Policy. The Policy provides for adequate safe guards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company have been denied access to the Audit Committee. The Whistle Blower Policy has been posted on the website of the Company at https://www.rnbdenims.com/investor/polices/VIGIL%20MECHANISM%20FOR%20DIREC TORS%20AND%20EMPLOYEES.pdf?

23. RISK MANAGEMENT

Risks are events, situations or circumstances which may lead to negative consequences on the Company''s business. Risk Management is a structured approach to manage uncertainty. An enterprise wide approach to Risk Management is being adopted by the Company and key risks will now be managed within a unitary framework. As a formal rollout, all business divisions and corporate functions will embrace Risk Management Structure, and make use of these in their decision making. Key business risks and their mitigation are considered in the annual/strategic business plans and in periodic management reviews. The risk management process over the period of time will become embedded into the Company''s business system and processes, such that our responses to risk remain current and dynamic.

24. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(5) of the Companies Act, 2013, your directors hereby confirm:

A. That in preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departments;

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

C. That the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company for preventing and detecting fraud and other irregulations;

D. That the directors had prepared the annual accounts on a going concern basis; and

E. 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;

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

25. ANNUAL EVALUATION

Pursuant to the applicable provisions of the Act and the Listing Regulations, the Board has carried out an Annual Evaluation of its own performance, performance of the Directors and the working of its Committees based on the evaluation criteria defined by Nomination and Remuneration Committee (NRC) for performance evaluation process of the Board, its Committees and Directors.

The performance evaluation of the board was evaluated by the board after seeking inputs from all the directors on the basis of the criteria such as participation in decision making; participation in developing corporate governance; providing advice and suggestion etc.

The Committees of the Board were assessed on the degree of fulfilment of key responsibilities, adequacy of Committee composition and effectiveness of meetings.

The board reviewed the performance of the individual directors on the basis of the criteria such as the contribution in decision making, contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive suggestions and advice in meetings, etc. In addition, the chairman was also evaluated on the key aspects of his role.

In a separate meeting of independent directors, performance of non-independent directors, performance of the board as a whole and performance of the chairman was evaluated, taking into account the views of executive directors and non-executive directors. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.

26. INTERNAL FINANCIAL CONTROL SYSTEM

The Company has a well-placed, proper and adequate internal financial control system which ensures that all the assets are safeguarded and protected and that the transactions are authorized recorded and reported correctly. The internal audit covers a wide variety of operational matters and ensures compliance with specific standard with regards to availability and suitability of policies and procedures. During the year no reportable material weakness in the design or operation were observed.

27. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The companies act, 2013 re-emphasizes the need for an effective internal financial control system in the company. Rule 8(5) (viii) of Companies (Accounts) Rules, 2014 requires the information regarding adequacy of internal financial controls with reference to the financial statements to be disclosed in the board'' report. The detailed report forms part of Independent Auditors Report.

28. CORPORATE GOVERNANCE

Your Company has incorporated the appropriate standards for corporate governance. Company is filing Corporate Governance Report to stock exchange quarterly. Pursuant to Regulation 34(3) read with Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 company is giving report on corporate governance report in annual report of the company. Corporate Governance Report is as per Annexure - 2.

29. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING

With reference to Section 134(3)(m) of the Companies Act, 2013, the details of conservation of energy, technology absorption and foreign exchange earnings are as per Annexure - 3.

30. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Pursuant to the provisions of section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility) Rules 2014; the Board has undertaken the CSR activities as per Rule 4 of Companies (Corporate Social Responsibility Policy) Rules, 2014. The details of CSR activities for the financial year 2022-23 forms part of this Board report in Annexure - 4.

31. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

As per Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements), Regulation 2015, the Management Discussion and Analysis Report is given in Annexure - 5.

32. SECRETERIAL AUDITOR

Your board has appointed M/s. Jainam N Shah & Co., Practicing Company Secretary, as secretarial Auditor of the company for the financial year 2022-23. The secretarial report for the financial year 2022-23 is attached as Annexure-6. Report of secretarial auditor is self-explanatory and need not any further clarification.

33. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

There was no employee drawing remuneration in excess of limits prescribed under section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The Disclosure pertaining to remuneration as required under section 197(12) of the Companies Act, 2013 read with Rule of the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016 are as per Annexure - 7.

34. CEO/ CFO CERTIFICATION

In terms of Regulation 17(8) of the Listing Regulations, the CFO has certified to the Board of Directors of the Company with regard to the financial statements and other matters specified in the said regulation for the financial year 2022-23. The certificate received from CFO is attached herewith as per Annexure - 8.

35. CODE OF CONDUCT

Board of Directors has formulated and adopted Code of Conduct for Board of Directors and Senior Management Personnel. During the year, Board of Directors and Senior Management Personnel has complied with general duties, rules, acts and regulations. In this regard certificate from Managing Directors as required under Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 has been received by the Board and the same is attached herewith as per Annexure - 9.

Code of Conduct form Board of Directors and Senior Management Personnel is available on below link: https://www.rnbdenims.com/investor/polices/RnB-CoC.pdf?

36. COMPLIANCE CERTIFICATE FROM THE AUDITORS REGARDING COMPLIANCE OF CONDITIONS OF CORPORATEGOVERNANCE:

Corporate Governance is a set of process, practice and system which ensure that the Company is managed in a best interest of stakeholders. The key fundamental principles of corporate governance are transparency and accountability. Company''s core business objective is to achieve growth with transparency, accountability and with independency. Company has adopted various corporate governance standard and doing business in ethical way by which Company has enhance stakeholders trust, shareholders wealth creation by improving shares valuation, market capitalization, etc.

A certificate received from M/s Pradeep K. Singhi & Associates, Statutory Auditors of the Company regarding compliance of the conditions of Corporate Governance, as required under Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached herewith as per Annexure - 10.

37. CERTIFICATION FROM COMPANY SECRETARY IN PRACTICE

M/s. Jainam N. Shah & Co., Practicing Company Secretary has issued a certificate required under the listing regulations, confirming that none of the Directors on the Board of the company has been debarred or disqualified from being appointed or continuing as director of the company by SEBI/Ministry of Corporate Affairs or any such statutory authority. The certificate is enclosed as Annexure 11.

38. SUBSIDIARIES, JOINT VENTURE AND ASSOCIATE COMPANIES

RB Industries, a partnership firm, is a Subsidiary of the company and a statement providing details of performance and salient features of the financial statements of RB Industries, as per Section 129(3) of the Act, is annexed as "Annexure-12" to this report.

39. SEXUAL HARASSMENT OF WOMEN

There were no incidences of sexual harassment reported during the year under review, in terms of the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules made thereunder. The objective of this policy is to provide protection against sexual harassment of women at workplace and for redressal of any such complaints of harassment, internal complaints committee has been set up to redress the complaints, if any.

The company has complied with the provisions relating to constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Your director''s 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.

40. SECRETARIAL STANDARDS ISSUED BY THE INSTITUTE OF COMPANY SECRETARIES OF INDIA (ICSI)

The Company complies with all applicable mandatory Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI).

41. PREVENTION OF INSIDER TRADING

The Company has adopted policy on Preservation of Insider Trading And Code Of Practices And Procedures For Fair Disclosure Of Unpublished Price Sensitive with a view to regulate trading in securities by the Directors and designated employees of the Company. The Policy requires pre-clearance for dealing in the Company''s shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the policy.

The Company has a Prohibition of Insider Trading Policy and the same has been posted on the website of the Company at

https://www.rnbdenims.com/investor/polices/Insider%20Trading.pdf?

42. MAINTENANCE OF COST RECORDS

The company is required to maintain Cost Records as specified by Central Government under section 148(1) of the Companies Act, 2013, and accordingly such accounts and records are made and maintained.

43. FRAUD REPORTING

During the year under review, no fraud has been reported by Auditors under Section 143(12) of the Companies Act, 2013.

44. INSURANCE:

All the properties and the Insurable Interest of the company Including building and stocks wherever necessary and to the extent required have been adequately insured. The company keeps reviewing the insurance amount every year as per requirement.

45. RESEARCH & DEVELOPMENT

Research and Development is important for businesses because it provides powerful knowledge and insights, leads to improvements to existing processes where efficiency can be increased and costs reduced. It also allows businesses to develop new products and services to allow it to survive and thrive in competitive markets. The benefits of Research & Development extend into entire sectors as well as positively impacting the wider economy. A sector that invests heavily in this will develop and achieve more, including providing real-world benefits to people.

The Company believes that technological obsolescence is a reality. Only progressive research and development will help us to measure up to future challenges and opportunities. We invest in and encourage continuous innovation. During the year under review, expenditure on research and development is not significant in relation to the nature size of operations of Company.

46. STATUTORY INFORMATION

The Company being basically engaged into the manufacturing and whole sell business of Quality Denim Products and is the member of BSE Main Platform. Apart from this business, the Company is not engaged in any other business/activities.

47. CAUTIONARY STATEMENT

Statements in this report and its annexures describing company''s projections, expectations and hopes are forward looking. Though, these are based on reasonable assumption, their actual results may differ.

48. APPRECIATION

Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication and commitment and express their sincere thanks and appreciation to all the employees for their continued contribution, support and co-operation to the operations and performance of the company.

49. ACKNOWLEDGEMENT:

Your Directors would like to express their sincere appreciation of the co-operation and assistance received from Shareholders, Bankers, regulatory bodies and other business constituents during the year under review.

Your Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers and staff, resulting in successful performance of the Company during the year.


Mar 31, 2018

To The Members of R & B Denims Limited

The Directors take pleasure in presenting the Eight Annual Report together with the audited financial statements for the year ended March 31, 2018. The Management Discussion and Analysis has also been incorporated into this report.

1. FINANCIAL RESULTS

(Rs. in Lakhs except per share data)

Particulars

2017-18

2016-17

Sales/ Business Income

21,735.91

20,775.50

Other Income

315.28

(222.21)

Total Income

22,051.19

20,553.29

Less: Expenses (Excluding Depreciation)

20,704.59

19,688.68

Profit before depreciation, exceptional items and taxes

1346.6

864.61

Less: Depreciation

644.39

818.65

Profit before exceptional items and taxes

702.21

45.96

Less: Exceptional Items

-

-

Profit before Taxation

702.21

45.96

Less: Income Tax

156.64

185.74

Deferred Tax

(38.77)

(93.80)

MAT Credit Provision

-

Profit after Taxation

584.34

(45.34)

Retained Earnings

Balance brought forward

159.91

207.85

Profit for the year

584.34

(45.34)

Other Comprehensive Income

4.02

(2.60)

Total Retained Earnings

748.27

159.91

Available Profit & (transfers) dealt as under:

Transfer to/(from) General Reserve

588.36

(47.94)

Balance carried forward

748.27

159.91

Earnings per share (Rs.) :Basic

4.20

0.00

Diluted

4.20

0.00

2. HIGHLIGHTS OF PERFORMANCE

- Standalone total income for the current financial year was increased to Rs. 22,051.19 (in lakhs) as compared to Rs. 20,553.29 (in lakhs) in 2017, increased by 7.29%;

- Standalone net sales for the year was Rs. 21,735.91 (in lakhs) as compared to Rs. 20,775.50 (in lakhs) in 2017, a growth of 4.62%;

- Standalone profit before tax for the year was Rs. 702.21 (in lakhs) as compared to Rs. 45.96 (in lakhs) in 2017, a remarkable growth of 1427.92%;

- Standalone Other Comprehensive Income (OCI) for the year was Rs. 4.02 (in lakhs) as compared to Rs. (2.60) (in lakhs) in 2017, positive growth of 2.54 times;

- Standalone Profit after tax for the year was Rs. 588.36 (in lakhs) as compared to Loss of Rs. 47.94 (in lakhs) in 2017, an enormous positive growth.

3. STATE OF COMPANY’S AFFAIRS

Your directors are glad to report that during the year under review your company has posted higher income of Rs. 22,051.19 (in lakhs) in the current year as compared to Rs. 20,553.29 (in lakhs) in the corresponding previous year. During the current year your company has shown a remarkable profit of Rs. 584.34 (in lakhs) as against to the net loss of Rs. 45.34 (in lakhs) in the corresponding previous year.

4. TRANSFER TO RESERVES IN TERMS OF SECTION 134(31(1) OF THE COMPANIES ACT, 2013

For the financial year ended on March 31, 2018, the Company has proposed to carry an amount of Rs 584.34 (in lakhs) to Balance Sheet under the head other Equity.

5. DIVIDEND

In view of the requirement of the profits for strengthening of the company, your directors have decided to plough back the profit into the business hence no dividend could be recommended for the year under review.

6. MATERIAL CHANGES SUBSEQUENT TO THE CLOSE OF THE YEAR:

No material changes have occurred between Balance Sheet date and the date on which the financial statement are approved by the Board of Directors.

7. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY’S OPERATIONS IN FUTURE:

During the audit period, the company has settled the case regarding non-compliance of Regulation 30(2) read with 30(3) of the Substantial Acquisition of Shares and Takeover Regulation, 2011 by promoters of the company for the year ended March, 2015 by paying settlement fees of Rs. 200,000/- which is recommended by High Powered Advisory Committee (HPAC) and subsequently approved by the panel of Whole Time members of SEBI and received the Settlement order from Adjudicating Officer dated 30/10/2017.

8. SUBSIDIARY COMPANY/ASSOCIATE/IOINT VENTURE:

There has been no subsidiary/Associate/Joint Venture incorporated/ceased of your company during the financial year 2017-18.

9. MANAGEMENTS DISCUSSION AND ANALYSIS REPORT

In terms of the provision of Regulation 34 of the Securities Exchange Board of India (Listing Obligation and Disclosure Requirement) Regulation 2015, the management Discussion and Analysis is a forming part of this Annual Report.

10. CHANGE IN THE NATURE OF BUSINESS

There is no change in the nature of the business of the company during the financial year 2017-18.

11. SHARE CAPITAL

The paid up Equity Share Capital as on March 31, 2018 was Rs. 1399.46 (in lakhs). The Company has not issued/allotted any during the financial year 2017-18.

12. FINANCE

The Cash and cash equivalent as at March 31, 2018 was Rs. 12.51 (in lakhs). 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.

12.1 ACCEPTANCE OF DEPOSITS

The Company has not accepted deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014 and any modification thereof.

12.2 PARTICULARS OF LOANS. GUARANTEES OR INVESTMENTS

Loans, guarantees and investments covered under Section 186 of the Companies Act, 2013 form part of the Notes to the financial statements provided in this Annual Report.

13. Quality initiatives

The Company continues its commitment to the highest levels of quality, superior service management, robust information security practices and mature business continuity management. In FY18, The Company has obtained two ISO Certificates namely ISO 9001:2015 and ISO 14001:2015 for Quality Management System and Environmental Management System respectively from TUV SUD South Asia Private Limited.

14. CORPORATE SOCIAL RESPONSIBILITY

The Company has not earned average profits over the three previous years 2014-2015, 20152016 & 2016-2017 and thus the requirement of expenditure of 2% of average net profits under section 198 over the last three years, is thus not applicable. However, since the Company had crossed the threshold for net profits computed under section 198 of the Companies Act, 2013 as on March 31, 2018, the CSR Committee will constitute in compliance with the provisions of the Act. The Committee would frame the CSR Policy for the Company in accordance with the terms of reference.

15. BUSINESS RESPONSIBILITY REPORT (BRR)

The Board of Directors of the Company hereby confirms that, according to the provisions of Regulation 34(2)(f) of the Securities Exchange Board of India (Listing Obligation and Disclosure Requirement) Regulation 2015 and amended thereof, the report on Business Responsibility Report (BRR) is not mandatorily applicable to our company, hence not annexed with Annual Report.

16. ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS COMMITTEES AND OF DIRECTORS

The Board of Directors has carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Act, SEBI Listing Regulations and the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017.

The Nomination and Remuneration Committee has defined evaluation criteria, procedure and time schedule for Performance Evaluation process for the Board, its Committees and Directors.

The Board’s functioning was evaluated on various aspects, including inter alia degree of fulfilment of key responsibilities, Board structure and composition, establishment and delineation of responsibilities to various Committees, effectiveness of Board processes, information and functioning.

The Board and the Nomination and Remuneration Committee reviewed the performance of individual directors on the basis of criteria such as attendance and contribution at Board/ Committee Meetings and guidance/ support to the management outside Board/ Committee Meetings. In addition, the Chairman was also evaluated on key aspects of his role, including setting the strategic agenda of the Board, encouraging active engagement by all Board members and motivating and providing guidance to the Managing Director.

The performance evaluation of Independent Directors was carried out by entire Board, excluding Director being evaluated. The performance evaluation of the Chairman and the Non Independent Directors was carried out by Independent Directors who also reviewed performance of the Board as a whole. The Nomination and Remuneration Committee also reviewed performance of the Board, its Committees and of Directors.

The Company’s policy on directors’ appointment and remuneration and other matters provided in Section 178(3) of the Act has been disclosed in the Corporate Governance Report, which is a part of this report.

17. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has in place a vigil mechanism for Directors and Employees, to report genuine concerns about any wrongful conduct with respect to the Company or its business or affairs. This policy covers malpractices, misuse or abuse of authority, fraud, violation of the Company’s policies or Rules, manipulations, negligence causing danger to public health and safety, misappropriation of monies, and other matters or activity on account of which the interest of the Company is affected or is likely to be affected and formally reported by whistle blowers. The Policy provides for adequate safeguards against victimization of employee who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.

The Policy on vigil mechanism and whistle blower policy may be accessed on the Company’s website at the link:

http://www.rnbdenims.com/investor/VIGIL%20MECHANISM%20FOR%20DIRECTORS%20AND%20EMPLOYEES.pdf?

18. POLICY FOR DETERMINATION OF MATERIALITY OF EVENTS

The Policy for Determining Materiality of Information / Events for reporting to the Stock Exchange is framed pursuant to SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015 which enables the investors to make well-informed investment decisions and take a view on the Materiality of an event that qualifies for disclosure.

The Policy for Determining Materiality of Information / Events may be accessed on the Company’s website at the link:

http://www.rnbdenims.com/investor/POLICY%20FOR%20DETERMINIMG%20MATRIALITY%20OF%20INFORMATION.pdf?

19. POLICY FOR PRESERVATION & ARCHIVAL OF DOCUMENTS

The Policy for Preservation & Archival of documents is framed pursuant to Regulation 9 & 30(8) of SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015, investors and concerned authority accessed preservation of documents and records of the Company through company’s website, which is required to be maintained under the Companies Act, 2013 and Listing Regulation. Any disclosure of events or information which has been submitted by the Company to the Stock Exchanges will be available on the website of the Company for a period of 5 years from the date of its disclosure and shall thereafter be archived from the website of the Company for a period of 3 years. This policy basically deals with the retention and archival of corporate records.

The Policy for Preservation & Archival of documents may be accessed on the Company’s website at the link:

http://www.rnbdenims.com/investor/PRESERVATION%20OF%20DOCUMENTS%20&%20ARCHIVAL%20POLICY.pdf?

20. COMPLIANCE WITH THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

Your Company has zero tolerance for Sexual Harassment at workplace. Your Company has in place an Anti Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

There were no complaints reported for sexual harassment during the financial year 2017-18.

21. DECLARATION BY INDEPENDENT DIRECTORS

Pursuant to the provisions of Section 149 of the Act, Mr. Dharmesh Prafulchandra Mehta, Mr. Girish Kumar Kalawatia, Mr. Manak Lal Tiwari, and Mrs. Anita Pankaj Jain are Independent Directors of the Company. They have submitted a declaration that each of them meet the criteria of independence as provided in Section 149(6) of the Act and Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI Listing Regulations”). There has been no change in the circumstances affecting their status as an Independent Director during the year.

During the year, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

22. DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mrs. Prerna Vikas Jain, Women & Independent Director retired with effect from December 01, 2017. The Board places on record its appreciation for her invaluable contribution and guidance provided by her.

Mrs. Anita Pankaj Jain was appointed as Additional Director and designated as Women & Independent Director with effect from December 27, 2017.

Pursuant to the provisions of Section 203 of the Act, the Key Managerial Personnel of the Company as on March 31, 2018 are: Mr. Rajkumar Mangilal Borana, Managing Director, Mr. Amitkumar Anandbhai Dalmia, Whole-time Director, Mr. Deepak A Dalmia, Whole-time Director, Mr. Ankur Mangilal Borana, Whole-time Director, and Mrs. Jyoti Arun Agarwal, Company Secretary.

In accordance with the provisions of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Deepak A. Dalmia (holding DIN: 00050547) retires by rotation and is eligible for re-appointment.

22.1 Policy on directors’ appointment and remuneration

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

22.2 Meetings

During the year, Board Meetings and Committee Meetings were convened and held. The details of which are given herein below and also in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

DETAILS OF MEETINGS HELD DURING THE F.Y. 2017-18

Sr. No.

Date of Meeting

Class of Meeting

Board Strength

No. of Directors Present

1

10-04-2017

Stakeholders’ Relationship Committee

3

3

2

22-05-2017

Audit Committee

4

4

3

27-05-2017

Board of Director Meeting

8

8

4

24-07-2017

Stakeholders’ Relationship Committee

3

3

5

05-08-2017

Nomination & Remuneration Committee

4

4

6

24-08-2017

Audit Committee

4

4

7

06-09-2017

Board of Director Meeting

8

6

8

27-09-2017

Board of Director Meeting

8

8

9

16-10-2017

Audit Committee

4

4

10

13-11-2017

Board of Director Meeting

8

7

11

27-11-2017

Stakeholders’ Relationship Committee

3

3

12

27-12-2017

Board of Director Meeting

8

6

13

16-01-2018

Nomination & Remuneration Committee

4

4

14

19-02-2018

Audit Committee

4

4

15

05-03-2018

Stakeholders’ Relationship Committee

3

3

16

31-03-2018

Board of Director Meeting

8

5

23. 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:

a. that in the preparation of the annual financial statements for the year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

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

c. 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;

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

e. that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

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

24. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on an arm’s length basis. 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 and the details of which is prescribed in Form AOC-2 as an “Annexure-A” attached to this report.

25. AUDITORS

25.1 Statutory Auditors

The Statutory Auditors, M/s. Pradeep Singhi & Associates, Chartered Accountants of Surat have indicated that due to the provision of section 139(2) of the Companies Act 2013, our firm is not eligible to re-appoint as a Statutory Auditor of your company. M/s. Pamita Doshi & Co., Chartered Accountants of Surat have submitted a written consent that they are eligible to hold office as Statutory Auditors of the Company in terms of Section 139 of the Act and that they satisfy the criteria provided in Section 141 of the Act. The Board recommends the appointment of M/s Pamita Doshi & Co., Chartered Accountants of Surat as Statutory Auditors of the Company to hold office from the conclusion of the ensuing Annual General Meeting till the conclusion of the Annual General Meeting of the Company to be held for the financial year 2022-23. The necessary resolution is being placed for consideration of the members at the ensuing Annual General Meeting. The auditors have also confirmed that they hold a valid certificate which is issued by the Peer Review Board of the Institute of Chartered Accountants of India.

25.2 Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its denim activity is required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed Messrs V. M. Patel & Associates to audit the cost accounts of the Company for the financial year 2018-19 on a remuneration of Rs. 35,000/- plus Service tax, if applicable and out of pocket expenses. As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, a Resolution seeking Member’s ratification for the remuneration payable to Messrs V. M. Patel & Associates, Cost Auditors is included at Item No. 5 of the Notice convening the Annual General Meeting.

25.3 Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 The Board has appointed Messrs JAINAM N SHAH & CO, Practicing Company Secretary, Surat, to conduct the Secretarial Audit for the financial year 2018-19. The Secretarial Audit Report for the financial year ended March 31, 2018 is annexed herewith marked as “Annexure-B” to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

26. 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 affect the socio-economic and environmental dimensions and contribute to sustainable growth and development.

27. CORPORATE GOVERNANCE

As per SEBI Listing Regulations, the Corporate Governance Report with the Auditors’ Certificate thereon, and the Management Discussion and Analysis are attached, which forms part of this report.

28. ENERGY CONSERVATION. TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as “Annexure-C”.

29. EXTRACT OF ANNUAL RETURN

In accordance with Section 134(3)(a) of the Companies Act, 2013, an extract of the annual return in form MGT 9 is appended as “Annexure-D” to the Board’s report.

30. PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197(12) read with Rule, 5 (1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the “Annexure-E” of the Annual Report.

31. SECRETARIAL STANDARDS

The Directors state that applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to ‘Meetings of the Board of Directors’ and ‘General Meetings’, respectively, have been duly followed by the Company.

32. INTERNAL FINANCIAL CONTROLS

Internal Financial Controls are an integrated part of the risk management process, addressing financial and financial reporting risks. The internal financial controls have been documented, digitised and embedded in the business processes.

Assurance on the effectiveness of internal financial controls is obtained through management reviews, control self-assessment, continuous monitoring by functional experts as well as testing of the internal financial control systems by the internal auditors during the course of their audits. We believe that these systems provide reasonable assurance that our internal financial controls are designed effectively and are operating as intended.

33. RISK MANAGEMENT

Our Enterprise Risk Management encompasses practices relating to the identification, analysis, evaluation, treatment, mitigation and monitoring of the strategic, external and operational controls risks to achieving our key business objectives. Risk Management at our company seeks to minimize the adverse impact of these risks, thus enabling the Company to leverage market opportunities effectively and enhance its long-term competitive advantage. Several risks can impact the achievement of a particular business objective. Similarly, a single risk can impact the achievement of several business objectives. The focus of risk management is to assess risks and deploy mitigation measures.

34. ACKNOWLEDGEMENTS

The Board would like to place on record its sincere appreciation to Central and State Government Departments, Organizations and Agencies for the continued help and co-operation extended by them and also gratefully acknowledge for the wholehearted support and contribution made by its customers, its shareholders as well as the various workers, staff, members, Distributors, Suppliers, Banks, concerned authorities and other business partners, towards the conduct of efficient and effective operations of your Company. The Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company.

35. 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.

36. DISCLAIMER

Certain statements in this report relating to Company’s objectives, projections, outlook, expectations, estimates, etc may be forward looking statements within the meaning of applicable laws and regulations. Although the Company believes that the expectations reflected in such forward looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Accordingly, actual results or performance could differ materially from such expectations, projections, etc whether express or implied as a result of among other factors, changes in economic conditions affecting demand and supply, success of business and operating initiatives and restructuring objectives, change in regulatory environment, other government actions including taxation, natural phenomena such as floods and earthquakes, customer strategies, etc over which the Company does not have any direct control.

For and on behalf of The Board Of Directors,

R & B DENIMS LIMITED

Sd/-

Place: Surat Rajkumar Mangilal Borana

Date: 28/05/2018 (Chairman & Managing Director)

DIN:01091166


Mar 31, 2017

BOARD''S REPORT

To The Members of R & B Denims Limited

The Directors take pleasure in presenting the Seventh Annual Report together with the audited financial statements for the year ended March 31, 2017. The Management Discussion and Analysis has also been incorporated into this report.

1. FINANCIAL RESULTS

__(Rs. In thousands except per share data)

Particulars

2016-17

2015-16

Sales/ Business Income

2,025,603.29

1,590,024.32

Other Income

57,548.43

36,437.81

Share of Loss in Partnership Firm

(27,822.80)

-

Total Income

2,055,328.92

1,626,462.13

Less: Expenses (Excluding Depreciation)

1,969,063.09

1,516,160.71

Profit before depreciation, exceptional items and taxes

86,265.83

110,301.42

Less: Depreciation

81,865.32

89,243.53

Profit before exceptional items and taxes

4,400.51

21,057.89

Less: Exceptional Items

-

-

Profit before Taxation

4,400.51

21,057.89

Less: Income Tax

18,574.47

8,981.19

Deferred Tax

(9,379.65)

1,847.89

MAT Credit Provision

-

-

Profit after Taxation

(4,794.31)

13,924.59

Balance Brought Forward

20,785.38

6,860.79

Balance Carried Down

15,991.08

20,785.38

Earnings per share (Rs.) :Basic

(0.34)

0.99

Diluted

(0.34)

0.99

2. HIGHLIGHTS OF PERFORMANCE

- Standalone total income for the current financial year was increased to Rs. 2,055,328.92 (in thousands) as compared to Rs. 1,626,462.13 (in thousands) in 2016, increased by 26.37%;

- Standalone net sales for the year was Rs. 2,025,603.29 (in thousands) as compared to Rs.

1,590,024.32 (in thousands) in 2016, a growth of 27.39%;

- Standalone profit before tax for the year was Rs. 4400.51 (in thousands) as compared to Rs. 21,057.89 (in thousands) in 2016;

- Standalone Profit after tax for the year was Rs. 4,794.31 (in thousands) as compared to Rs. 13,924.59 (in thousands) in 2016.

3. STATE OF COMPANY''S AFFAIRS

Your directors report that during the year under review your company has posted higher income of Rs. 2,055,328.92 (in thousands) in the current year as compared to Rs. 1,626,462.13 (in thousands) in the corresponding previous year. During the current year your company has shown a negative trend in profit of Rs. 4,794.31 (in thousands) as against to the net Profit of Rs. 13,924.59 (in thousands) in the corresponding previous year. This is mainly because of share in loss of newly constituted partnership firm to the extent of Rs. 27,822.80 (Rs. in thousands) (because of depreciation).

4. TRANSFER TO RESERVES IN TERMS OF SECTION 134(3)(l) OF THE COMPANIES ACT-2013

For the financial year ended on March 31, 2017, the Company has proposed to carry an amount of Rs (4,794.31) (in thousands) to Balance Sheet under the head “General Reserve Account”.

5. DIVIDEND

In view of the requirement of the profits for strengthening of the company, your directors have decided to plough back the profit into the business hence no dividend could be recommended for the year under review.

6. MATERIAL CHANGES SUBSEQUENT TO THE CLOSE OF THE YEAR:

No material changes have occurred between Balance Sheet date and the date on which the financial statement are approved by the Board of Directors.

7. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY''S OPERATIONS IN FUTURE:

During the year under review the company has received an order vide dated 29/12/2016 issued by DCIT for addition of Rs. 18,825,700/- in income towards share application money received during the assessment year 2013-14 and the company has further make an appeal against the order passed to CIT(A)-II, Surat.

8. SUBSIDIARY COMPANY/ASSOCIATE/lOINT VENTURE:

There has been no subsidiary/Associate/Joint Venture incorporated/ceased of your company during the financial year 2016-17.

9. MANAGEMENT’S DISCUSSION AND ANALYSIS REPORT

In terms of the provision of Regulation 34 of the Securities Exchange Board of India (Listing Obligation and Disclosure Requirement) Regulation 2015, the management Discussion and Analysis is a forming part of this Annual Report.

10. CHANGE IN THE NATURE OF BUSINESS

There is no change in the nature of the business of the company during the financial year 2016-17.

11. SHARE CAPITAL

The paid up Equity Share Capital as on March 31, 2017 was Rs. 139,946.88 (in thousands). The Company has not issued/allotted any during the financial year 2016-17.

12. FINANCE

Cash and cash equivalent as at March 31, 2017 was Rs. 18,171.00 (in thousands). 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.

12.1 ACCEPTANCE OF DEPOSITS

The Company has not accepted deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014 and any modification thereof.

12.2 PARTICULARS OF LOANS. GUARANTEES OR INVESTMENTS

Loans, guarantees and investments covered under Section 186 of the Companies Act,

2013 form part of the Notes to the financial statements provided in this Annual Report.

Denim fabric production in India is concentrated in the western and a northern part of the country with more than 45 percent contribution coming from Gujarat is the production hub.

13. CORPORATE SOCIAL RESPONSIBILITY

The Board of Directors of the Company hereby confirms that the provisions of Section 135(1) of the Companies Act, 2013 is not applicable to our company.

14. BUSINESS RESPONSIBILITY REPORT (BRR)

The Board of Directors of the Company hereby confirms that, according to the provisions of Regulation 34(2)(f) of the Securities Exchange Board of India (Listing Obligation and Disclosure Requirement) Regulation 2015 and amended thereof, the report on Business Responsibility Report (BRR) is not mandatorily applicable to our company, hence not annexed with Annual Report.

15. ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS COMMITTEES AND OF DIRECTORS

Pursuant to the applicable provisions of the Act and the Listing Regulations, the Board has carried out an annual evaluation of its own performance, performance of the Directors as well as the evaluation of the working of its Committees.

The Nomination and Remuneration Committee has defined evaluation criteria, procedure and time schedule for Performance Evaluation process for the Board, its Committees and Directors.

The Board''s functioning was evaluated on various aspects, including inter alia degree of fulfillment of key responsibilities, Board structure and composition, establishment and delineation of responsibilities to various Committees, effectiveness of Board processes, information and functioning.

Directors were evaluated on aspects such as attendance and contribution at Board/ Committee Meetings and guidance/ support to the management outside Board/ Committee Meetings. In addition, the Chairman was also evaluated on key aspects of his role, including setting the strategic agenda of the Board, encouraging active engagement by all Board members and motivating and providing guidance to the Managing Director.

Areas on which the Committees of the Board were assessed included degree of fulfillment of key responsibilities, adequacy of Committee composition and effectiveness of meetings.

The performance evaluation of Independent Directors was carried out by entire Board, excluding Director being evaluated. The performance evaluation of the Chairman and the Non Independent Directors was carried out by Independent Directors who also reviewed performance of the Board as a whole. The Nomination and Remuneration Committee also reviewed performance of the Board, its Committees and of Directors.

The Chairman of the Board provided feedback to the Directors on an individual basis, as appropriate. Significant highlights, learning and action points with respect to the evaluation were presented to the Board.

Details of the Remuneration Policy are given in the Corporate Governance Report.

16. VIGIL MECHANISM / WHISTLE BLOWER POLICY

Fraud free and corruption free work culture has been core of your Company. In view of the potential risk of fraud and corruption due to rapid growth, your Company has put an even greater emphasis to address this risk. To meet this objective your Company has adopted a Whistle Blower Policy establishing Vigil Mechanism to provide a formal mechanism to the Directors and employees to report their concern about unethical behavior, actual or suspect fraud or violation of the Company''s Code of Conduct or ethics policy. The Policy provides for adequate safeguards against victimization of employee who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.

The Policy on vigil mechanism and whistle blower policy may be accessed on the Company''s website at the link:

http://www.rnbdenims.com/investor/VIGIL%20MECHANISM%20FOR%20DIRECTORS%20AND%2

OEMPLOYEES.pdf?

17. POLICY FOR DETERMINATION OF MATERIALITY OF EVENTS

The Policy for Determining Materiality of Information / Events for reporting to the Stock Exchanges is framed pursuant to SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015 which enables the investors to make well-informed investment decisions and take a view on the Materiality of an event that qualifies for disclosure.

The Policy for Determining Materiality of Information / Events may be accessed on the Company''s website at the link:

http://www.rnbdenims.com/investor/POLICY%20FOR%20DETERMINIMG%20MATRIALITY%20OF% 20INFORMA TION.pdf?

18. POLICY FOR PRESERVATION & ARCHIVAL OF DOCUMENTS

The Policy for Preservation & Archival of documents is framed pursuant to Regulation 9 & 30(8) of SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015, investors and concerned authority accessed preservation of documents and records of the Company through company''s website, which is required to be maintained under the Companies Act, 2013 and Listing Regulation. Any disclosure of events or information which has been submitted by the Company to the Stock Exchanges will be available on the website of the Company for a period of 5 years from the date of its disclosure and shall thereafter be archived from the website of the Company for a period of 3 years. This policy basically deals with the retention and archival of corporate records.

The Policy for Preservation & Archival of documents may be accessed on the Company''s website at the link:

http://www.rnbdenims.com/investor/PRESERVATION%20OF%20DOCUMENTS%20&%20ARCHIVAL

%20POLICY.pdf?

19. COMPLIANCE WITH THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

Your Company has zero tolerance for Sexual Harassment at workplace. Your Company has in place an Anti Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

There were no complaints reported for sexual harassment during the financial year 2016-17.

20. DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration from each independent director under Section 149(7) of the Companies Act, 2013, that they meet the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

21. DIRECTORS AND KEY MANAGERIAL PERSONNEL

There has not been any appointment and resignation of any directors or Key Managerial Personnel in the company in the financial year.2016-17. Hence there was no change took place among the signatories of the company.

In accordance with the provisions of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Ankur Mangilal Borana (holding DIN: 01091164) retires by rotation and is eligible for re-appointment.

21.1 Policy on directors’ appointment and remuneration

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

21.2 Meetings

During the year, Board Meetings and Committee Meetings were convened and held. The details of which are given herein below and also in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

DETAILS OF MEETINGS HELD DURING THE F.Y. 2016-17

Sr.

No.

Date of Meeting

Class of Meeting

Board

Strength

No. of Directors Present

1

11/04/2016

Stakeholders'' Relationship Committee

3

3

2

20/05/2016

Board of Director Meeting

8

8

3

29/06/2016

Audit Committee

4

4

4

27/07/2016

Stakeholders'' Relationship Committee

3

3

5

02/08/2016

Nomination & Remuneration Committee

4

4

6

24/08/2016

Audit Committee

4

4

7

22/09/2016

Board of Director Meeting

8

8

8

18/10/2016

Audit Committee

4

4

9

14/11/2016

Board of Director Meeting

8

8

10

12/12/2016

Stakeholders'' Relationship Committee

3

3

11

09/01/2017

Nomination & Remuneration Committee

4

4

12

25/02/2017

Audit Committee

4

4

13

06/03/2017

Stakeholders'' Relationship Committee

3

3

14

23/03/2017

Board of Director Meeting

8

8

22. 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:

a. that in the preparation of the annual financial statements for the year ended March 31, 2017, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

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

c. 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;

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

e. that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

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

23. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on an arm''s length basis. 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 and the details of which is prescribed in Form AOC-2 as an “Annexure-A” attached to this report.

24. AUDITORS

24.1 Statutory Auditors

The Company''s Auditors, Messrs Pradeep Singhi & Associates, Chartered Accountants, Surat hold office till the conclusion of the ensuing Annual General Meeting of the Company and are eligible for re-appointment. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed there under for reappointment as Statutory Auditors of the Company. The auditors have also confirmed that they hold a valid certificate which is issued by the Peer Review Board of the Institute of Chartered Accountants of India.

24.2 Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its denim activity is required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed Messrs V. M. Patel & Associates to audit the cost accounts of the Company for the financial year 2017-18 on a remuneration of Rs. 35,000/- plus Service tax, if applicable and out of pocket expenses. As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, a Resolution seeking Member''s ratification for the remuneration payable to Messrs V. M. Patel & Associates, Cost Auditors is included at Item No. 5 of the Notice convening the Annual General Meeting.

24.3 Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules,

2014 The Board has appointed Messrs JAINAM N SHAH & CO, Practicing Company Secretary, Surat, to conduct Secretarial Audit for the financial year 2016-17. The Secretarial Audit Report for the financial year ended March 31, 2017 is annexed herewith marked as “Annexure-B” to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

25. 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 affect the socio-economic and environmental dimensions and contribute to sustainable growth and development.

26. CORPORATE GOVERNANCE

According to the Securities Exchange Board of India (Listing Obligation and Disclosure Requirement) Regulation 2015, a separate section on corporate governance practices followed by the Company, together with a certificate from the Company''s Auditors confirming compliance forms an integral part of this Report. The Report on Corporate Governance by Auditor is forming part of Annual Report.

27. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as “Annexure-C”.

28. EXTRACT OF ANNUAL RETURN

In accordance with Section 134(3)(a) of the Companies Act, 2013, an extract of the annual return in form MGT 9 is appended as “Annexure-D” to the Board''s report.

29. PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197(12) read with Rule, 5 (1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the “Annexure-E” of the Annual Report.

30. RISK MANAGEMENT

Our Enterprise Risk Management encompasses practices relating to the identification, analysis, evaluation, treatment, mitigation and monitoring of the strategic, external and operational controls risks to achieving our key business objectives. Risk Management at our company seeks to minimize the adverse impact of these risks, thus enabling the Company to leverage market opportunities effectively and enhance its long-term competitive advantage. Several risks can impact the achievement of a particular business objective. Similarly, a single risk can impact the achievement of several business objectives. The focus of risk management is to assess risks and deploy mitigation measures.

31. ACKNOWLEDGEMENTS

The Board would like to place on record its sincere appreciation to Central and State Government Departments, Organizations and Agencies for the continued help and co-operation extended by them and also gratefully acknowledge for the wholehearted support and contribution made by its customers, its shareholders as well as the various workers, staff, members, Distributors, Suppliers, Banks, concerned authorities and other business partners, towards the conduct of efficient and effective operations of your Company. The Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company.

32. 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.

33. DISCLAIMER

Certain statements in this report relating to Company''s objectives, projections, outlook, expectations, estimates, etc may be forward looking statements within the meaning of applicable laws and regulations. Although the Company believes that the expectations reflected in such forward looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Accordingly, actual results or performance could differ materially from such expectations, projections, etc whether express or implied as a result of among other factors, changes in economic conditions affecting demand and supply, success of business and operating initiatives and restructuring objectives, change in regulatory environment, other government actions including taxation, natural phenomena such as floods and earthquakes, customer strategies, etc over which the Company does not have any direct control.

For and on behalf of The Board Of Directors,

R & B DENIMS LIMITED

Sd/-

Place: SURAT Rajkumar Mangilal Borana

Date: 27/05/2017 (Chairman & Managing Director)

DIN: 01091166


Mar 31, 2016

Board''s Report & MDA BOARD''S REPORT & MANAGEMENT DISCUSSION AND ANALYSIS

To The Members of R & B Denims Limited

The Directors take pleasure in presenting the Sixth 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.

1. FINANCIAL RESULTS

(Rs. In thousands)

Particulars

2015-16

2014-15

Sales/ Business Income

1,590,024.32

1,544,346.65

Other Income

36,437.81

21,931.71

Total Income

1,626,462.13

1,566,278.36

Less: Expenses (Excluding Depreciation)

1,516,160.71

1,474,016.88

Profit before depreciation, exceptional items and taxes

110,301.42

92,261.48

Less: Depreciation

89,243.53

84,532.69

Profit before exceptional items and taxes

21,057.89

7,728.79

Less: Exceptional Items

-

-

Profit before Taxation

21,057.89

7,728.79

Less: Income Tax

8,981.19

1,477.92

Deferred Tax

1,847.89

3,991.89

MAT Credit Provision

-

1,429.83

Profit after T axation

13,924.59

3,688.81

Balance Brought Forward

6,860.79

3,171.99

Balance Carried Down

20,785.38

6,860.79

Earnings per share (Rs.) :Basic

0.99

0.27

Diluted

0.99

0.27

2. HIGHLIGHTS OF PERFORMANCE

- Standalone total income for the current financial year was increased to Rs. 1,626,462.13 (in thousands) as compared to Rs. 1,566,278.36 (in thousands) in 2015, increased by 3.84%;

- Standalone net sales for the year was Rs. 1,590,024.32 (in thousands) as compared to Rs. 1,544,346.65 (in thousands) in 2015, a growth of 2.96%;

- Standalone profit before tax for the year was Rs. 21,057.89 (in thousands) as compared to Rs. 7,728.79 (in thousands) in 2015;

- Standalone Profit after tax for the year was Rs. 13,924.59 (in thousands) as compared to Rs. 3,688.19 (in thousands) in 2015.

3. STATE OF COMPANY''S AFFAIRS

Your directors are glad to report that during the year under review your company has posted higher income of Rs. 1,626,462.13 (in thousands) in the current year as compared to Rs.

1,566,278.36 (in thousands) in the corresponding previous year. Hence, your company has generated higher net profit of Rs. 13,924.59 (in thousands) in the current year as compared to net profit of Rs. 3,688.81 (in thousands) in the corresponding previous year.

4. TRANSFER TO RESERVES IN TERMS OF SECTION 134(3)(l) OF THE COMPANIES ACT-2013

For the financial year ended on March 31, 2016, the Company has proposed to carry an amount of Rs 13,924.59 (in thousands) to Balance Sheet under the head “General Reserve Account”.

5. DIVIDEND

In view of the requirement of the profits for strengthening of the company, your directors have decided to plough back the profit into the business hence no dividend could be recommended for the year under review.

6. MATERIAL CHANGES SUBSEQUENT TO THE CLOSE OF THE YEAR:

No material changes have been occurred between Balance Sheet date and the date on which the financial statement are approved by the Board of Directors.

7. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY''S OPERATIONS IN FUTURE:

During the year under review there has been no such significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company''s operations in future.

8. SUBSIDIARY COMPANY/ASSOCIATE/lOINT VENTURE:

There has been no subsidiary/Associate/Joint Venture incorporated/ceased of your company during the financial year 2015-16.

9. MANAGEMENT''S DISCUSSION AND ANALYSIS REPORT

In terms of the provision of Regulation 34 of the Securities Exchange Board of India (Listing Obligation and Disclosure Requirement) Regulation 2015, the management Discussion and Analysis is a forming part of this Annual Report.

10. CHANGE IN THE NATURE OF BUSINESS

There is no change in the nature of the business of the company during the financial year 2015-16.

11. SHARE CAPITAL

The paid up Equity Share Capital as on March 31, 2016 was Rs. 139,946.88 (in thousands). The Company has not issued/allotted any shares however the company has made offer for sale of Equity Shares during the financial year 2015-16.

12. FINANCE

Cash and cash equivalent as at March 31, 2016 was Rs. 16,528.32 (in thousands). 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.

12.1 ACCEPTANCE OF DEPOSITS

The Company has not accepted deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014 and any modification thereof.

12.2 PARTICULARS OF LOANS. GUARANTEES OR INVESTMENTS

Loans, guarantees and investments covered under Section 186 of the Companies Act,

2013 form part of the Notes to the financial statements provided in this Annual Report.

13. OPERATIONS

As per the latest GDP growth estimates, Indian economy grew by 7.56% in FY16 compared to 7.4% in FY15, mostly driven by improved economic fundamentals and revision of GDP methodology calculation. Particularly, performance of industry sector was excellent in the last year, and your company has maintained and stable at the same position in the current year also. The performance of your Company is highly encouraging. Your Company has closed the financial year 2015-16 with 2.96% growth in sales and PBT (excluding Exceptional items) has shown a remarkable growth of 172.46% compared to the previous year. Your Company has achieved the growth across all business segments.

14. DENIM INDUSTRY OUTLOOK AND OPPORTUNITIES

The Indian denim industry is showing continual growth trends over the years. With newer territories, technologies and trends, the market is only going to see some exciting moments ahead. Consumers, especially the youth, in cities beyond the metros and mini metros are growing exceptionally asp rational. With increasing globalization, young India prefers denims as a part of their essential daily wear. Denim Manufacturing Association estimated that Denim manufacturing and consumption in India has grown at a compounded annual growth rate (CAGR) of up to 15% over the last decade and is expected to grow at similar levels over the next few years.

Denim is of the most promising category in India''s apparel market. The global market for denim is forecast to reach USD 64.1 billion by 2020. The Indian denim industry has shown continual growth over the years and currently the country boasts of a denim manufacturing capacity of around 1.1 billion meters per annum. Its utilization levels are pegged at 80-85%. Despite the impressive statistics, the Indian denim manufacturing industry contributes 5% to the global scenario, reflecting the overall performance of the textiles industry. However, according to industry experts, denim is the only segment in the Indian textile industry that has the potential to grow manifold.

The value share of denim market is skewed in favour of mega metros and metros which account for almost half of the total denim market at a share of 49 percent. Though the markets of other urban areas and rural India contribute high in volume terms, their combined share in market value is only 51 percent.

As the penetration of denim category and the awareness of denim quality increases in those cities and rural India, their share in market value will start increasing with more number of consumers willing to pay premium for the quality, design and fit.

In fact, India has been ranked as a top destination for retail investments among 30 global emerging markets. However, despite the Indian denim manufacturing industry witnessing rapid growth in the last 4-5 years.

Denim fabric production in India is concentrated in the western and a northern part of the country with more than 45 percent contribution coming from Gujarat is the production hub.

The Indian denim industry stands to benefit immensely from the ambitious “Make in India” initiative. The vision of the programme has the potential to overhaul the segment''s perception and the country''s contribution in the world denim scenario. However, to turn this vision in to reality, India''s denim manufacturing segment needs to be equipped with facilitating mechanisms. Even more important is the effective implementation of these mechanisms. Once this is done, the strength of domestic Indian denim markets as well as its denim export capabilities will remain unparalleled.

15. COSTS-DENIM BUSINESS

During the year 2016, the economy witnessed an upward movement in the overall cost structure and the Company continued to focus on cost improvements through its excellent programs.

15.1 Cost of materials consumed

Cost of materials consumed accounted for 78.75% of total income from operations (77.17% in 2015). Cost of material consumed increased by 5.07% in 2016 over 2015. Yarn prices were increased by 3.45% in 2016 as compared to 2015 while Coal/Lignite prices were decreased by 7.02% in 2016 as compared to 2015. Color/Chemical prices increased by 8.32% in 2016 over 2015 and stores/packing materials prices were increased by 104.21% in 2016 as compared to 2015.

15.2 Power & Fuel

The power and fuel (electricity Expenses) spent was Rs. 106,966.57 (in thousands) which constitutes 6.73% of the total income from operations of the company.

15.3 Other Expenditure

Other expenditure (exclusion of Manufacturing Expenditure) constitutes 1.32% of total income from operations of the Company. The increase in other expenditure (exclusion of Manufacturing Expenditure) was 84.48% in 2016 over 2015 primarily due to pollution control expense.

16. SUSTAINABLE DEVELOPMENT

Sustainability has been deeply embedded into the Company''s business and has become an integral part of its decision making process while considering social, economic and environmental dimensions. During the year 2015-16, a Sustainable Development was developed with a focus on the following areas:

16.1 Water Emissions

- Our Company is a member of Gujarat Eco-Textile Park (GETP) since 2014, The Park help us to reduce water pollution. The Company has also implemented various measures across all its operations to control fugitive emissions.

16.2 Air Emissions

- Initiatives were taken to reduce air pollution causes due to production processes. Company has taken license from Gujarat Pollution Control Board (GPCB). The officer''s of the board often comes on a surprise visit to our factory and verify the level of air pollution. The samples are tested by GPCB in their own laboratory and report is issued to us.

17. HEALTH & SAFETY

Health & Safety (H&S) remains the Company''s top priority. Our company is equipped with proper first aid facilities, Medical facilities and stretchers. The shift supervisors have been trained in basic life support techniques.

With regard to safety, two key areas of focus identified were Facility Management for the employees and Equipment, Tools & Material Management. The Facility Management initiative was implemented to ensure adequate welfare facilities for employees such as washrooms with bathing facilities, rest rooms, proper availability of drinking water etc. The Equipment, Tools & Material Management program ensured that the tools used by employees were safe and the company provides earplugs, helmet, nose & face mask, hand gloves, safety shoes to protect its employees. The process of screening of employees was made more stringent to ensure that the employees were aligned with the Company''s objectives.

18. HUMAN RESOURCES

Many initiatives have been taken to support business through organizational efficiency, process change support, and various employees'' engagement programs, which have helped the Organization, achieve higher productivity levels. A significant effort has also been undertaken to develop leadership as well as technical/functional capabilities in order to meet future talent requirement.

The Company''s HR processes such as hiring and on boarding, fair transparent performance evaluation and talent management process, and market aligned policies have been seen as at good level practices in the Industry.

18.1 Employees of Choice:

The Company has positioned itself as one of the best companies to work for. Employees have option to work with the world class technologies and have flexibility to pursue different functions. Employees are encouraged to express their views and are empowered to work independently. Employees are given the opportunity to learn through various small projects, which make them look at initiatives from different perspectives and thus provide them with a platform to become result oriented. This has helped greatly in overall development of the employee and has significantly arrested the attrition rate.

18.2 Leadership Development:

As a part of leadership development, talented employees have been seconded to the senior leadership team to mentor them and prepare them for the next higher role. Apart from this, a large number of senior, middle and other employees are sent for leadership programs or are assigned to small independent projects, which are planned for identified talent.

18.3 Industrial Relation:

The Company shares relevant business information with the union in order to enlighten them and make them sensitive towards business requirements. This has helped to build a healthy relationship and resolve issue through mutual dialogue.

18.4 Individual Development Planning:

This is an annual process tied to business planning and the budget cycle, whereby the management in our organization establishes training goals and plans for employees of the organization.

19. CORPORATE SOCIAL RESPONSIBILITY

The Board of Directors of the Company hereby confirms that the provisions of Section 135(1) of the Companies Act, 2013 is not applicable to our company.

20. BUSINESS RESPONSIBILITY REPORT (BRR)

The Board of Directors of the Company hereby confirms that, according to the provisions of Regulation 34(2)(f) of the Securities Exchange Board of India (Listing Obligation and Disclosure Requirement) Regulation 2015, the give report on Business Responsibility Report (BRR) is not mandatorily applicable to our company, hence not annexed with Annual Report.

21. 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 at all locations of the Company including the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosure. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls.

22. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Vigil Mechanism of the Company, which also incorporates a whistle blower policy in terms of the Listing Agreement, includes an Ethics & Compliance. The Company has a vigil mechanism and whistle blower policy to deal with unethical behavior, fraud or violation of the Company''s code, if any. Protected disclosures can be made by a whistle blower through an e-mail, or dedicated telephone line or a letter 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://www.rnbdenims.com/images/VIGIL%20MECHANISM%20FOR%20DIRECTORS%20AND %20EMPLOYEES.pdf

23. POLICY FOR DETERMINATION OF MATERIALITY OF EVENTS

The Policy for Determining Materiality of Information / Events for reporting to the Stock Exchanges is framed pursuant to SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015 which enables the investors to make well-informed investment decisions and take a view on the Materiality of an event that qualifies for disclosure.

24. POLICY FOR PRESERVATION & ARCHIVAL OF DOCUMENTS

The Policy for Preservation & Archival of documents is framed pursuant to Regulation 9 & 30(8) of SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015, investors and concerned authority accessed preservation of documents and records of the Company through company''s website, which is required to be maintained under the Companies Act, 2013 and Listing Regulation. Any disclosure of events or information which has been submitted by the Company to the Stock Exchanges will be available on the website of the Company for a period of 5 years from the date of its disclosure and shall thereafter be archived from the website of the Company for a period of 3 years. This policy basically deals with the retention and archival of corporate records.

25. COMPLIANCE WITH THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

Your Corporation is committed to prevention of sexual harassment of women at workplace and takes prompt action in the event of reporting of such incidents. In this regard, internal complaints committees have been constituted to deal with sexual harassment complaints, if any and conduct enquires.

There were no complaints received of sexual harassment during the financial year 2015-16.

26. DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration from each independent director under Section 149(7) of the Companies Act, 2013, that they meet the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

27. DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board had appointed Mrs. Jyoti Arun Agarwal as Company Secretary cum compliance officer in the Board Meeting of the Company held on December 21, 2015 pursuant to the provisions of Section 203 and all other applicable provisions, if any, of the Companies Act, 2013 with effect from December 21, 2015.

Mr. Pradip Kanti Dave former Company Secretary cum compliance officer resigned from the services of the Company with effect from July 17, 2015.

The Board has placed on record its appreciation for the outstanding contributions made by Mr. Mr. Pradip Kanti Dave during their respective tenures of office

In accordance with the provisions of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Amitkumar A Dalmia (holding DIN: 00034642) retires by rotation and is eligible for re-appointment.

27.1 Policy on directors’ appointment and remuneration

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

27.2 Meetings

During the year, Board Meetings and Committee Meetings were convened and held. The details of which are given herein below and also in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

DETAILS OF MEETINGS HELD DURING THE F.Y. 2015-16

Sr.

No.

Date of Meeting

Class of Meeting

Board

Strength

No. of Directors Present

1

13/04/2015

Stakeholders'' Relationship Committee

3

3

2

20/05/2015

Board of Director Meeting

8

6

3

18/06/2015

Board of Director Meeting

8

6

4

29/06/2015

Audit Committee

4

4

5

17/07/2015

Board of Director Meeting

8

4

6

27/07/2015

Stakeholders'' Relationship Committee

3

3

7

03/08/2015

Nomination & Remuneration Committee

4

4

8

24/08/2015

Audit Committee

4

4

9

18/10/2015

Audit Committee

4

4

10

10/11/2015

Board of Director Meeting

8

8

11

14/12/2015

Stakeholders'' Relationship Committee

3

3

12

21/12/2015

Board of Director Meeting

8

7

13

22/12/2015

Recommendations of offer price Committee

3

3

14

08/02/2016

Nomination & Remuneration Committee

4

4

15

25/02/2016

Board of Director Meeting

8

8

16

14/03/2016

Stakeholders'' Relationship Committee

3

3

17

23/03/2016

Audit Committee

4

4

28. 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:

a. 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;

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

c. 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;

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

e. that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

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

29. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on an arm''s length basis. 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 and the details of which is prescribed in Form AOC-2 as an “Annexure-A” attached to this report.

30. AUDITORS

30.1 Statutory Auditors

The Company''s Auditors, Messrs Pradeep Singhi & Associates, Chartered Accountants, Surat hold office till the conclusion of the ensuing Annual General Meeting of the Company and are eligible for re-appointment. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed there under for reappointment as Statutory Auditors of the Company. The auditors have also confirmed that they hold a valid certificate which is issued by the Peer Review Board of the Institute of Chartered Accountants of India.

30.2 Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its denim activity is required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed Messrs V. M. Patel & Associates to audit the cost accounts of the Company for the financial year 2015-16 on a remuneration of Rs. 35,000/- plus Service tax, if applicable and out of pocket expenses. As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, a Resolution seeking Member''s ratification for the remuneration payable to Messrs V. M Patel & Associates, Cost Auditors is included at Item No. 5 of the Notice convening the Annual General Meeting.

30.3 Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 The Board has appointed Messrs JAINAM N SHAH & CO, Practicing Company Secretary, Surat, to conduct Secretarial Audit for the financial year 2015-16. The Secretarial Audit Report for the financial year ended March 31, 2016 is annexed herewith marked as “Annexure-B” to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

31. 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 affect the socio-economic and environmental dimensions and contribute to sustainable growth and development.

32. CORPORATE GOVERNANCE

According to the Securities Exchange Board of India (Listing Obligation and Disclosure Requirement) Regulation 2015, a separate section on corporate governance practices followed by the Company, together with a certificate from the Company''s Auditors confirming compliance forms an integral part of this Report. The Report on Corporate Governance by Auditor is forming part of Annual Report.

33. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as “Annexure-C”.

34. EXTRACT OF ANNUAL RETURN

In accordance with Section 134(3)(a) of the Companies Act, 2013, an extract of the annual return in form MGT 9 is appended as “Annexure-D” to the Board''s report.

35. PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197(12) read with Rule, 5 (1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the “Annexure-E” of the Annual Report.

36. RISK MANAGEMENT

Our Enterprise Risk Management encompasses practices relating to the identification, analysis, evaluation, treatment, mitigation and monitoring of the strategic, external and operational controls risks to achieving our key business objectives. Risk Management at our company seeks to minimize the adverse impact of these risks, thus enabling the Company to leverage market opportunities effectively and enhance its long-term competitive advantage. Several risks can impact the achievement of a particular business objective. Similarly, a single risk can impact the achievement of several business objectives. The focus of risk management is to assess risks and deploy mitigation measures.

37. ACKNOWLEDGEMENTS

Your Directors thank the various Central and State Government Departments, Organizations and Agencies for the continued help and co-operation extended by them. The Directors gratefully acknowledge all stakeholders of the Company viz. workers, staff, customers, members, dealers, vendors, banks, concerned authorities 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.

38. 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.

39. DISCLAIMER

Certain statements in this report relating to Company''s objectives, projections, outlook, expectations, estimates, etc may be forward looking statements within the meaning of applicable laws and regulations. Although the Company believes that the expectations reflected in such forward looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Accordingly, actual results or performance could differ materially from such expectations, projections, etc whether express or implied as a result of among other factors, changes in economic conditions affecting demand and supply, success of business and operating initiatives and restructuring objectives, change in regulatory environment, other government actions including taxation, natural phenomena such as floods and earthquakes, customer strategies, etc over which the Company does not have any direct control.

For and on behalf of

The Board Of Directors, R & B DENIMS LIMITED

Sd/-

Rajkumar Mangilal Borana

Place: SURAT (Chairman & Managing Director)

Date: 20/05/2016 DIN: 01091166


Mar 31, 2015

Dear Members,

The Directors take pleasure in presenting the Fifth 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.

1. HIGHLIGHTS OF PERFORMANCE

* Standalone net sales for the year was Rs. 1,544,346.65 (in thousands) as compared to Rs. 1,072,804.11 (in thousands) in 2014, a growth of 43.95%;

* Standalone profit before tax for the year was Rs. 7,728.79 (in thousands)as compared to Rs. 5506.77 (in thousands)in 2014;

* Standalone Profit after tax for the year was Rs. 3,688.19 (in thousands) as compared to Rs. 1,733.74 (in thousands) in 2014.

2. FINANCIAL RESULTS

(Rs. In thousands)

Particulars Year Ended Year Ended 31.03.2015 31.03.2014

Sales/ Business Income 1,544,346.65 1,072,804.11

Other lncome 21,931.71 17,307.05

Total Income 1,566,278.36 1,090,111.16

Profit Before Tax and 7,728.79 5,506.77 Exceptional Items

Exceptional Items - (1,783.86)

Profit before Taxation 7,728.79 3,722.91

Income Tax (1,477.92) (1,066.99)

Deferred Tax (3,992.50) (2,286.80)

MAT Credit Provision 1,429.83 1,364.63

Profit after Taxation 3,688.19 1,733.74

The financial year 2014-15 has been a very successful and important year for the Company. In this year, company brought an Initial Public Offer Issue and listed on SME Platform of Bombay Stock Exchange (BSE)

3. TRANSFER TO RESERVES IN TERMS OF SECTION 134(3)(J) OF THE COMPANIES ACT, 2013

For the financial year ended on March 31, 2015, the Company is proposed to carry an amount of Rs 3,688.19 (in thousands) to Balance Sheet under the head General Reserve Account.

4. DIVIDEND

During the year Company has earned adequate profit and your directors have decided to plough back the profit into the business and hence no dividend could be recommended.

5. MANAGEMENT''S DISCUSSION AND ANALYSIS REPORT

Management''s Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges in India, is presented in a separate section forming part of the Annual Report.

6. SHARE CAPITAL

The paid up Equity Share Capital as on March 31, 2015 was Rs. 139,946.88 (in thousands). During the year under review, the Company has issued 3,710,000 Equity shares of Rs. 10/- each without differential voting rights. As on March 31,2015, the Directors of the Company holds 21.32% shares of the Company.

7. FINANCE

Cash and cash equivalent as at March 31, 2015 was Rs. 8,040.85 (in thousands) 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.

ACCEPTANCE OF DEPOSITS

The Company has not accepted deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the "Annexure-A" to the Board of Directors Report.

8. OPERATIONS

As per the latest GDP growth estimates, Indian economy grew by 7.4% in FY15 compared to 6.9% in FY14, mostly driven by improved economic fundamentals and revision of GDP methodology calculation. Even inflation showed signs of moderation, a welcome sign - wholesale price and consumer price inflation declined to 4.2% and 7.4% respectively. Compare with the last year''s 6.3% and 10.1% However, high interest rates, a depreciated currency led to deceleration in the economic recovery. Particularly, performance of industry sector was lackluster last year, owing to high interest cost and low investment. In the backdrop of above macro-economic scenario, the performance of your Company is highly encouraging. Your Company has closed the financial year 2014-15 with 44% growth in sales and PBT (excluding Exceptional items) has shown a growth of 40.35% compared to the previous year. Your Company has achieved the growth across all business segments.

9. DENIM INDUSTRY OUTLOOK AND OPPORTUNITIES

The Indian denim industry is showing continual growth trends over the years. With newer territories, technologies and trends, the market is only going to see some exciting moments ahead. Consumers, especially the youth, in cities beyond the metros and mini metros are growing exceptionally aspirational. They are increasingly accepting denim as a core apparel category to be worn as an everyday casual garment.

Denim is of the most promising category in India''s apparel market. In 2013, the denim market of India was worth Rs. 13,500 Cr. which accounts for 5 percent of the total apparel market of the country. The market is projected to grow at a CAGR of 15 percent to become Rs. 27,200 Cr. market in 2018. The denim market in India is skewed towards men''s segments with 85 percent contribution coming from it. Women''s denim segment contributes 9 percent to the market and the kids segment the rest 6 percent. The women''s and kid''s denim segments are expected to witness higher growth rates due to their lower base and increasing focus of brands and retailers on those segments.

The value share of denim market is skewed in favour of mega metros and metros which account for almost half of the total denim market at a share of 49 percent. Though the markets of other urban areas and rural India contribute high in volume terms, their combined share in market value is only 51 percent.

As the penetration of denim category and the awareness of denim quality increases in those cities and rural India, their share in market value will start increasing with more number of consumers willing to pay premium for the quality, design and fit.

Denim is primarily produced from cotton and India is expected to overcome China as the single largest producer of cotton the world in 2015. The country is the second largest producer of cotton yarn. The denim fabric production capacity of India is more than 1,000 million meters per year, and India is still witnessing entrance of more denim fabric manufacturers in the industry.

Denim fabric production in India is concentrated in the western and a northern part of the country with more than 45 percent contribution coming from Gujarat is the production hub.

10. COSTS DENIM BUSINESS

During the year 2014, the economy witnessed an upward movement in the overall cost structure and the Company continued to focus on cost improvements through its excellent programs.

Cost of materials consumed

Cost of materials consumed accounted for 78% of total income from operations (87% in 2014), Cost of material consumed increased by 29% in 2015 over 2014. Yarn prices were increased by 23% in 2015 as compared to 2014 while Coal/Lignite prices were increased by 84% in 2015 as compared to 2014. Color/Chemical prices increased by 66% in 2015 over 2014. The cost of material consumed during the year increased on account of fully utilization of capacity of Plant and machinery installed.

Power & Fuel

The power and fuel spend was Rs. 146,167.66 (in thousands) which constitutes 9% of the total income from operations of the company. Coal cost increased by 130% in 2015 over 2014 while Electricity purchased increased by 42% in 2015 over 2014 mainly on account of a fully utilization of capacity of Plant and machinery installed.

Other Expenditure

Other expenditure constitutes 1% of total income from operations of the Company. The increase in other expenditure was 18% in 2015 over 2014.

11. SUSTAINABLE DEVELOPMENT

Sustainability has been deeply embedded into the Company''s business and has become an integral part of its decision making process while considering social, economic and environmental dimensions. During the year 2014-15, a Sustainability Development was developed with a focus on the following areas:

a. Dust Emissions

b. Air Emissions

Dust Emissions

* Our Company is a member of Gujarat Eco-Textile Park (GETP], The Park help us to reduce dust pollution. The Company has also implemented various measures across all its operations to control fugitive emissions.

Air Emissions

* Initiatives were taken to reduce air pollution cause due to production processes. Company has taken license from Gujarat Pollution Control Board (GPCB). The officers of the board often comes on a surprise visit to our factory and takes the sample of air to verify level of air pollution. The samples are tested by GPCB in their own laboratory and report is issued to us.

12. HEALTH & SAFETY

Health & Safety (H&S] remains the Company''s top priority. Our company is equipped with proper first aid facilities, Medical facilities and stretchers. The shift supervisors have been trained in basic life support techniques.

With regard to safety, two key areas of focus identified were Facility Management for the employees and Equipment, Tools & Material Management. The Facility Management initiative was implemented to ensure adequate welfare facilities for employees such as washrooms with bathing facilities, rest rooms, proper availability of drinking water etc. The Equipment, Tools & Material Management program ensured that the tools used by employees were safe and the company provides earplugs, helmet, nose & face mask, hand gloves, safety shoes to protect its employees. The process of screening of employees was made more stringent to ensure that the employees were aligned with the Company''s objectives.

13. HUMAN RESOURCES

Many initiatives have been taken to support business through organizational efficiency, process change support, and various employees'' engagement programs, which have helped the Organization, achieve higher productivity levels. A significant effort has also been undertaken to develop leadership as well as technical/functional capabilities in order to meet future talent requirement.

The Company''s HR processes such as hiring and on boarding, fair transparent performance evaluation and talent management process, and market aligned policies have been seen as at good level practices in the Industry.

Employees of Choice:

The Company has positioned itself as one of the best companies to work for. Employees have option to work with the world class technologies and have flexibility to pursue different functions. Employees are encouraged to express their views and are empowered to work independently. Employees are given the opportunity to learn through various small projects, which make them look at initiatives from different perspectives and thus provide them with a platform to become result oriented. This has helped greatly in overall development of the employee and has significantly arrested the attrition rate.

Leadership Development:

As a part of leadership development, talented employees have been seconded to the senior leadership team to mentor them and prepare them for the next higher role. Apart from this, a large number of senior, middle and other employees are sent for leadership programs or are assigned to small independent projects, which are planned for identified talent.

Industrial Relation:

The Company shares relevant business information with the union in order to enlighten them and make them sensitive towards business requirements. This has helped to build a healthy relationship and resolve issue through mutual dialogue.

Individual Development Planning:

This is an annual process tied to business planning and the budget cycle, whereby the management in our organization establishes training goals and plans for employees of the organization.

14. CORPORATE SOCIAL RESPONSIBILITY

The Board of Directors of the Company hereby confirms that the provisions of Section 135(1) of the Companies Act, 2013 is not applicable to our company.

15. BUSINESS RISK MANAGEMENT

The Board of Directors of the Company hereby confirms that, according to the provisions contained in circular no. CIR/CFD/POLICY CELL/7/2014 dated September 15, 2014 of SEBI, clause 49 of the listing agreement is not applicable to our company.

16. 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 (IA) function is defined in the Internal Audit Charter. 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 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 corrective actions thereon are presented to the Audit Committee of the Board.

17. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Vigil Mechanism of the Company, which also incorporates a whistle blower policy in terms of the Listing Agreement, includes an Ethics & Compliance. The Company has a vigil mechanism and whistle blower policy to deal with unethical behavior, fraud or violation of the Company''s code, if any. Protected disclosures can be made by a whistle blower through an e-mail, or dedicated telephone line or a letter 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://www.rnbdenims.com/images/VIGIL%20MECHANISM%20F0R%20DIRECT0RS %20AND%20EMPL0YEES.pdf

18. DIRECTORS

The members had appointed Mrs. Prerna Jain as Independent Director in the Fourth AGM of the Company pursuant to the provisions of Section 149,152 and all other applicable provisions, if any, of the Companies Act, 2013 for a period of 5 years with effect from September 22,2014.

Mr. Kapil Hemant kumar Hojiwala former Independent Director retired from the services of the Company with effect from August25,2014.

The Board has placed on record its appreciation for the outstanding contributions made by Mr. Kapil Hemant kumar Hojiwala during their respective tenures of office.

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 49 of the Listing Agreement.

In accordance with the provisions of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Deepak A Dalmia retires by rotation and is eligible for re-appointment.

Remuneration Policy

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

Meetings

Meetings is prepared and circulated in advance to the Directors. During the year, Board Meetings and Committee Meetings were convened and held. The details of which are given herein below and also in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

Details of Meetings held during the F.Y. 2014-15

Sr. Date of Meeting Class of Meeting Board No. of Directors No. Strength Present

1 10/04/2014 Stakeholders'' 3 3 Relationship Committee

2 11/04/2014 Board of 8 6 Director Meeting

3 10/05/2014 Audit 4 4 Committee

4 25/05/2014 Board of 8 6 Director Meeting

5 10/06/2014 Board of 8 4 Director Meeting

6 21/07/2014 Stakeholders'' 3 3 Relationship Committee

7 18/08/2014 Nomination & 4 4 Remuneration Committee

8 24/08/2014 Audit Committee 4 4

9 25/08/2014 Board of Director 8 6 Meeting

10 30/09/2014 Board of Director 8 6 Meeting

11 05/11/2014 Stakeholders'' 3 3 Relationship Committee

12 12/11/2014 Audit Committee 4 4

13 14/11/2014 Board of Director 8 8 Meeting

14 10/02/2015 Board of Director 8 4 Meeting

15 17/02/2015 Nomination & 4 4 Remuneration Committee

16 25/02/2014 Stakeholders 3 3 ''Relationship Committee

17 02/03/2015 Audit Committee 4 4

19. 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:

a. 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;

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

c. 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;

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

e. that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

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

20. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on an arm''s length basis. 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 and the details of which is prescribed in Form AOC-2 as an "Annexure-B" attached to this report.

All Related Party Transactions are placed before the Audit Committee as also the Board for approval. Prior omnibus approval of the Audit Committee is obtained on a quarterly basis for the transactions, which are of a foreseen and repetitive nature. 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 quarterly basis. The statement is supported by a Certificate from the CEO & MD and the CFO.

None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company

21. AUDITORS

Statutory Auditors

The Company''s Auditors, Messrs PRADEEP SINGHI & ASSOCIATES, Chartered Accountants, Surat who retire at the ensuing Annual General Meeting of the Company are eligible for reappointment. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed thereunder for reappointment as Auditors of the Company. 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.

Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its denim activity is required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed Messrs V. M Patel & Associates to audit the cost accounts of the Company for the financial year 2014-15 on a remuneration of Rs. 35,000 plus Service tax, if applicable and out of pocket expenses. As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, a Resolution seeking Member''s ratification for the remuneration payable to Messrs V.M Patel & Associates, Cost Auditors is included at Item No. 5 of the Notice convening the Annual General Meeting.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 The Board has appointed Messrs JAINAM N SHAH & CO, Practicing 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 C" to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

22. 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 affect the socio-economic and environmental dimensions and contribute to sustainable growth and development.

23. CORPORATE GOVERNANCE

As per Clause 49 of the Listing Agreement with the Stock Exchanges, a separate section on corporate governance practices followed by the Company, together with a certificate from the Company''s Auditors confirming compliance forms an integral part of this Report. The Report on Corporate Governance by Auditor is annexed herewith as "Annexure-D".

24. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as "Annexure-E".

25. EXTRACT OF ANNUAL RETURN

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

26. PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule, 5 (1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annexure-G of the Annual Report

Having regard to the provisions of the first proviso to Section 136(1) of the Act and as advised, the Annual Report excluding the aforesaid information is being sent to the members of the Company. The said information is available for inspection at the registered office of the Company during working hours of the Company up to the date of the ensuing Annual General Meeting and any member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request. The full Annual Report including the aforesaid information is being sent electronically to all those members who have registered their email addresses and is available on the Company''s website.

27. ACKNOWLEDGEMENTS

Your Directors thank the various Central and State Government Departments, Organizations and Agencies for the continued help and co-operation extended by them. The Directors gratefully acknowledge all stakeholders of the Company viz. workers, staff, customers, members, dealers, vendors, banks, concerned authorities 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.

28. 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.

29. DISCLAIMER

Certain statements in this report relating to Company''s objectives, projections, outlook, expectations, estimates, etc may be forward looking statements within the meaning of applicable laws and regulations. Although the Company believes that the expectations reflected in such forward looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Accordingly, actual results or performance could differ materially from such expectations, projections, etc whether express or implied as a result of among other factors, changes in economic conditions affecting demand and supply, success of business and operating initiatives and restructuring objectives, change in regulatory environment, other government actions including taxation, natural phenomena such as floods and earthquakes, customer strategies, etc over which the Company does not have any direct control.

BY ORDER OF THE BOARD OF DIRECTORS

SD/-

SURAT Amitkumar Anandbhai Dalmia (Chairman & Whole-time Director) Date: 20/05/2015 DIN:00034642 Add: C/602/603 Regency Tower, Dumas Road, 20/05/2015 Piplod, Surat-394550


Mar 31, 2014

THE MEMBERS

The Directors have pleasure in presenting the 4th Annual Report on the business and operations of the Company and Audited Statement of Accounts of the Company for the year ended 31st March, 2014.

FINANCIAL RESULTS (Rs. In thousand) YEAR ENDEND YEAR ENDED Particulars 31.03.2014 31.03.2013

Sales/ Business Income 1,072,804.11 580,183.48

Other Income 17,307.05 7,015.56

Total Income 1,090,111.16 587,199.04

Profit Before Tax and Exceptional Items 5.509.42 1,776.82

Exceptional Items 1,783.86 -

Profit before Taxation 3,725.56 1,776.82

Income Tax 1,067.50 338.58

Deferred Tax 2,287.75 -

MAT Credit Provision 1,365.12 -

Profit after Taxation 1.735.43 1,438.24



GENERAL REVIEW

The company is engaged into manufacturing and selling of Denim fabrics. The company''s performance has been overwhelming and encouraging during the year. Despite the stiff challenges, the company had achieved its targeted turnover and Net Profit as well. The Directors are hopeful to face challenges successfully and to make head way in the coming years.

OPERATIONS

The macroeconomic scenario during the year under review was characterized by world economy continuing its downward trend on growth; as world economy further decelerated its growth rate to 3.0% in 2013 compared to 3.2% in 2012. India''s economy showed some signs of recovery, albeit slow, in FY 2013-14. India''s GDP growth rate moderately increased to 4.9%, as compared to 4.5% in FY 2012-13.

This was accompanied by some easing in the inflation rate. However, high interest rates, a depreciated currency and uncertainty due to logjam of decision making of earlier government in the center have led to deceleration in the economic recovery. Particularly, performance of industry sector was lackluster last year, owing to high interest cost and low investment. In the backdrop of above macro-economic scenario, the performance of your Company is highly encouraging. Your Company has closed the financial year 2013-14 with 85% growth in sales and 31% growth in Operating Earnings before Interest, Depreciation and Taxes. (Operating EBITDA). PBT (excluding Exceptional Income) has shown a growth of 110% compared to the previous year. Your Company has achieved the growth across all business segments.

A detailed analysis of the financial results is given in the Management Discussion and Analysis report, which forms part of this report.

DIVIDEND

During the year Company has earned adequate profit and your directors have decided to plough back the profit into the business hence no dividend could be recommended.

LOANS & ADVANCES

The company has taken unsecured loans from companies, firms or other parties mentioned under the register maintained u/s. 301 of the companies Act, 1956 and the same are repaid during the year. The amount of loan accepted during the period is Rs. 240 lacs. The amount of loan repaid during the period is Rs. 385 lacs.

ACCEPTANCE OF DEPOSITS

The Company has not accepted any deposits in contravention of Sec. 58A of the Companies Act, 1956 read with Companies (Acceptance of Deposit Rules) 1975, as on 31st March, 2014. The Company has not accepted deposits from Small Depositors within the meaning of Section 58AA of the Companies Act, 1956 read with Companies (Amendment) Act, 2000.

PARTICULARS OF EMPLOYEES

During the year the Company''s relation with its employees remained cordial. The Directors express their gratitude to the management and staff for their continued co-operation and excellent contribution towards achieving the corporate goal. In compliance with the provisions of Sec. 217(2A) of the Companies Act, 1956 read with the provisions of the Companies (Particulars of Employees) Rules, 1975, no Director or employee of the company has received remuneration in excess of the limit specified u/s 217 (2A) of the Companies Act, 1956.

MATERIAL CHANGES SUBSEQUENT TO THE CLOSE OF THE YEAR

Material changes have occurred between Balance Sheet date and the date on which the financial statement are approved by the Board of Directors. Your Directors are pleased to inform that the Company has been listed on Bombay Stock Exchange on SME Platform on 22nd day of April, 2014.

DISCLOSURE OF PARTICULARS WITH RESPECT OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS & OUT GO.

Information required under Section 217(1)(e) of the Companies Act, 1956 read with Rule 2 of the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 and under Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975, as amended from time to time, forms part of this report. The information required to be given under Sec 217(2A) is given as per Annexure – A

DIRECTORS

Mr. Kapil Hojiwala resigned from his post of Independent Director of the Company with effect from 25th August, 2014. Your Directors take this opportunity to express their deep sense of appreciation for the valuable services rendered by Mr. Kapil Hojiwala during his tenure as a Director.

Pursuant to the provisions of Sections 149, 150, 152 and other applicable provisions of the Companies Act, 2013 and the rules made thereunder, read with Schedule IV to the Companies Act, 2013, your Directors proposed to re-appoint Mr. Girish Kumar Kalawatia, Mr. Dharmesh P. Mehta and Mr. Manak Lal Tiwari as Independent Directors of the Company to hold office for five consecutive years for a term up to 31st March, 2019, subject to approval by the members in the ensuing Annual General Meeting and their office as Independent Directors shall not be subject to retirement by rotation Pursuant to the provisions of Sections 149, 150, 152 and other applicable provisions of the Companies Act, 2013 and the rules made thereunder, read with Schedule IV to the Companies Act, 2013, your Directors propose to appoint Mrs. Prerna Jain as Independent Director of the Company to hold office for five consecutive years for a term up to 31st March, 2019, her office as Independent Director shall not be subject to retirement by rotation subject to approval by the members in the ensuing Annual General Meeting.

CORPORATE GOVERNANCE

Your Company is committed to the tenets of good Corporate Governance and has taken adequate steps to ensure that the requirements of Corporate Governance as laid down in Clause 52 of the Listing Agreement are complied with.

A separate report on Corporate Governance and Management Discussion and Analysis Report is being published as a part of the Annual Report of the Company.

The Auditors of the Company have certified that conditions of Corporate Governance as stipulated under Clause 52 of the Listing Agreement are complied by the Company and their Certificate is annexed to the Report on Corporate Governance.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to section 217(2AA) of the Companies Act, 1956 the Directors confirm that:

1. In presentation of the annual accounts, the applicable standards had been followed along with proper explanation in relation to material departures;

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

3. The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 (to the extent applicable) and the Comapnies Act, 2013 (to the extent notified) for safeguarding the assets of your Company and for preventing and detection of fraud and other irregularities;

4. The Directors have prepared the Annual Accounts on a Going Concern basis.

AUDITORS

The Auditors of the Comapny M/s. Pradeep Singhi & Associates, Chartered Accountants, are retiring at the forthcoming AGM. The Auditors being eligible offer themselves for reappointment.

APPRECIATION

We wish to place on record our deep and sincere appreciation for the contribution made by the workers, staff and executives towards the performance of the Company.

ACKNOWLEDGEMENT

Your Directors would like to appreciate the efforts of the Company''s employees for their continued co-operation and unstinted support extended to the company. The support of Bank, Vendors and Buyers has also been invaluable to the Company''s performance and your Directors take this opportunity to appreciate it deeply.

By Order of Board of Directors Sd/- Date: 25/08/2014 Rajkumar Borana Place: Surat Chairman & Managing Director

Get Instant News Updates
Enable
x
Notification Settings X
Time Settings
Done
Clear Notification X
Do you want to clear all the notifications from your inbox?
Settings X