Directors Report of RCI Industries & Technologies Ltd.

Mar 31, 2018

The Directors have pleasure in presenting the 27th (Twenty Seventh) Annual Report on the business and operations of the Company together with the audited accounts for the financial year ended March 31, 2018.

FINANCIAL RESULTS

The financial performance of your Company for the financial year ended March 31, 2018 is summarized below:-

Particulars	Standalone – Year Ended *		Consolidated – Year Ended *
	Year ended on 31st March, 2018	Year ended on 31st March, 2017	Year ended on 31st March, 2018	Year ended on 31st March, 2017
Revenue from Operations	16,204,652,033	14,059,591,029	20,373,487,421	17,567,915,388
Other Income	46,866,996	22,257,527	66,816,957	22,284,591
Total Income	16,251,519,028	14,081,848,551	20,440,304,378	17,590,199,980
Total Expenses	16,024,854,660	13,976,177,594	20,036,566,055	17,196,863,843
Profit / (Loss) before extraordinary Items and tax	226,664,368	105,670,956	403,738,322	393,336,137
Less: Tax Expenses:
Current Tax	68,359,407	28,822,170	68,363,086	28,843,317
Deferred Tax	7,367,811	6,082,863	7,367,586	6,116,984
Minimum Alternate Tax	-	-	-	(21,147)
Profit / ((Loss) for the Period	150,937,150	70,765,924	328,007,651	358,396,983

*The above figures are extracted from the audited standalone and consolidated financial statements as per Indian Accounting Standards (IND AS). The financial statements for 2016 17 have been re-drawn as per IND AS. Accordingly, the figures stated above for 2016-17 may not be comparable with financials for 2015-16 approved by the Directors vide Report dated 2nd September, 2017.

There have been no material changes and commitments that have occurred after close of the financial year till the date of this report, which affects the financial position of the Company.

RESERVES & SURPLUS

The Company’s reserve & surplus for the financial year ended March 31, 2017 is Rs. 1,031,122,004 as compared to the previous year it was 896,507,218.

DIVIDEND

Based on the Company’s performance, your Directors are pleased to recommend a Final Dividend of Rupee 0.50/- per equity share of face value of Rs. 10/- each for the year ended 31st March, 2018. The Interim Dividend of Rupee 0.50/- per equity share was paid on 22nd December, 2017.

The Final Dividend, subject to the approval of Members at the Annual General Meeting on 20th July, 2018, will be paid within 30 days from the date of its declaration, to the members whose names appear in the Register of Members after giving effect to all valid share transfer requests lodged with the Company or its Register & Share Transfer Agents (R&T Agents) viz. Bigshare Services Private Limited as of the close of business hours on July 13, 2018.

The Board of Directors has declared Interim Dividend of Rupee 0.50/- per equity share on 28th November, 2017 and was paid on 22nd December, 2017. The total dividend for the financial year 2017-18 (including the proposed Final Dividend) aggregates to 10% of the face value of the equity shares.

BUSINESS PERFORMANCE REVIEW

Your Company achieved an all-time high performance both in the turnover and its profits. The gross revenues touched Rs. 16,251,519,028* and the profit after taxes recorded was Rs. 150,937,150*. Your Company coupled high level of modernization with, concentrated efforts of both Management and employees, the whole hearted support of Banks, suppliers and customers to attain these levels of performance. The earnings per equity share (of face value Rs. 10) for the year 2017-18 has increased from Rs. 6.18 to Rs. 11.23. During the year under review, your Company has entered into B2C segment for production of copper cables/electrical wires under the brand name “RIKAYAA”, which will improve the profitability and future prospects of the Company.

Note: The above figures are extracted from the audited standalone financial statements.

Future Prospects

The enhanced capacity of 24,000 MT in a manufacturing unit located in Baddi, Himachal Pradesh, is expected to be operational in FY19. The Company plans to foray into value added segments of defence and the mint in an endeavor to enhance profitability. The capacity verification and other technical eligibility of the plant have been successfully carried out and very soon your Company will be supplying materials to the ordinance factory, katni, Ministry of Defence, Government of India.

At a sectoral level, there exists tremendous growth potential for copper in India. This will come from sectors like power, telecom, automobile, railway, defence etc. Reports indicate that the domestic copper usage will double in India by next decade driven by Government initiatives and increased consumption.

Barring unforeseen circumstances the company is confident of achieving better results in the current year.

SUBSIDIARIES AND ASSOCIATES

Subsidiary in Dubai

Your Company, upon the approval of Board of Directors, incorporated a wholly owned subsidiary in Dubai Multi Commodities Centre Authority under the name and style of “RCI World Trade Link DMCC” for trading of Ferrous and Non-Ferrous Metal products, on February 10, 2014 with a share capital of AED 50,000 divided into 50 shares of value AED 1,000 each. RCI World Trade Link DMCC has commenced the operations under the requisite licenses and permissions obtained from regulatory authorities.

Subsidiary in India

Your Company, upon the approval of Board of Directors, incorporated a wholly owned subsidiary under the name and style of “RCI Skills & Social Development Private Limited” for providing Vocational training, Skills and other Social Development activities towards CSR on September 29, 2014 with a paidup share capital of Rs. 1,00,000 divided into 10,000 equity shares of Rs. 10 each.

Associate Companies

Your Company has 2 Associate Companies in the name of “Metalrod Private Limited” and “Ace Matrix Solutions Limited” as at March 31, 2017.

Consolidated Financial Statements

In compliance with the applicable provisions of the Companies Act, 2013 and Indian Accounting Standard (IND AS)-110 on consolidated financial statements, the Audited consolidated financial statement for the financial year ended March 31, 2018, is provided in this Annual Report.

Pursuant to Section 129(3) of the Companies Act, 2013 and Indian Accounting Standard- 110 issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements presented by the Company include the Financial Statements of its Subsidiaries.

The company has not consolidated the financial statement of the associates companies (viz. Metalrod Private Limited and Ace Matrix Solutions Limited) as the applicable accounting standard for the time being in force, exempts the consolidation of financial statement of such associates because the investment in shares of associates was acquired/ made as stock in trade and the intention of such investment was to dispose of the same in near future and further Section 129 (3) of the Companies Act, 2013 read with first proviso to Rule 6 of Companies (Accounts) Rules, 2014 which states that in case of a company covered under sub section (3) of section 129 which is not required to prepare consolidated financial statements under Accounting Standards, it shall be sufficient if the company complies with provision of Consolidated Financial Statements provided in Schedule III of the Act and the company has duly complied with provision of Schedule III of the Act by disclosing the name of associates not consolidated and reason thereof as mentioned above.

Further, a separate statement containing the salient features of the financial statements of subsidiaries and Associates of the Company in the prescribed form AOC-1 has been disclosed in the Consolidated Financial Statements. In terms of provisions of Section 136 of the Companies Act, 2013, the Company shall place separate audited accounts of the Subsidiary Companies on its website.

The Company will make available physical copies of these documents upon request by any shareholder of the Company/ subsidiary interested in obtaining the same.

These documents shall also be available for inspection at the registered office of the Company during business hours up to the date of ensuing AGM.

SHARE CAPITAL

During the year under review, the Company has increased its Authorised Share Capital from Rs. 150,000,000 (Rupees Fifteen Crore only) divided into 15,000,000 (One Crore Fifty Lac) Equity Shares of Rs. 10/- each to Rs. 250,000,000 (Rupees Twenty Five Crore) divided into 25,000,000 (Two Crore Fifty Lac) Equity Shares of Rs. 10/- each vide special resolution passed through Postal Ballot dated 28th March, 2018.

Further, there were no change in the Issued, Subscribed and Paid-up Share Capital of your Company.

Hence, the Paid-up Share Capital of the Company is Rs. 134,364,150.

LISTING

Your Company’s fully paid-up equity shares continue to be listed and traded on BSE Limited (‘BSE’). The said Stock Exchange has nation-wide trading terminals and hence facilitates the Shareholders/Investors of the Company in trading the Shares. The Company has paid the annual listing fee for the Financial Year 2018-19 to the said Stock Exchange.

COMPULSORILY CONVERTIBLE DEBENTURES

Your Company has allotted 5,60,000 Unsecured Zero Coupon Compulsorily Convertible Debentures of Rs. 900/- each to Promoters/Non-Promoters, for an aggregate amount of Rs. 50,40,00,000 (Rupees Fifty Crore Forty Lakh only) by way of Preferential Allotment on Private Placement Basis, which shall be converted into Equity Shares of Rs. 225/- each (1 CCD=4 Equity Shares) on or before completion of 18 months from the date of their allotment viz. 31.03.2018.

DEPOSITORIES

Your Company has arrangements with National Securities Depository Limited (‘NSDL’) and Central Depository Services (India) Limited (‘CDSL’), the Depositories, for facilitating the members to trade in the fully paid up equity shares of the Company in Dematerialized form. The Annual Custody fees for the Financial Year 2018-19 has been paid to both the Depositories.

MANAGEMENT DISCUSSION AND ANALYSIS

Management Discussion and Analysis Statement for the year under review as provided under Listing Regulations is separately attached hereto and forms a part of this Annual Report.

CORPORATE SOCIAL RESPONSIBILITY

The applicability of concept of Corporate Social Responsibility on the Company commenced from the financial year 2016-17, as the turnover of the Company crossed Rs. 1,000 Crore in the financial year 2015-16. Accordingly, pursuant to Section 135 of the Companies Act, 2013, the Company has constituted a Corporate Social Responsibility Committee (CSR Committee). The CSR Committee comprises of two Independent Directors and the Managing Director. The Committee had given their recommendation to incur the CSR expenses through its wholly owned subsidiary named “RCI Skills & Social Development Private Limited” and identified the areas of Vocational Skills especially among children as specified under Schedule VII of the Companies Act, 2013 as primary focus area. However, during the financial year 2016-17 the subsidiary company has applied various governments tender related to said vocational skills but all the tenders got rejected on technical grounds. Hence, requisite amount of CSR expenditure could not be spent. However, your Company has committed to spend the consolidated amount of CSR for both current and previous financial year during the financial year 2017-18 in order to comply with the Companies Act, 2013 in true spirit.

Accordingly, your Company has spent Rs. 35 Lakh in the financial year 2017-18. The Annual Report on CSR Activities is attached as ‘ANNEXURE-5’.

POSTAL BALLOT

During the year under review, your Company sought the approval of the Shareholders on the following resolutions, vide Postal Ballot Notice dated 22nd February, 2018:

- Ordinary Resolution for Increase in Authorised Share Capital and Alteration of the Capital Clause in the Memorandum of Association.

- Issue and Allotment of Compulsorily Convertible Debentures and Equity Shares arising on conversion of Compulsorily Convertible Debentures.

The said notice along with Postal Ballot Form were duly sent to the Shareholders and your Company also offered E-Voting facility as an alternate option for voting by the Shareholders, which enabled them to cast their votes electronically, instead of Physical Postal Ballot Form. The results on the voting conducted through Postal Ballot process were declared on 28th March, 2018.

The procedure prescribed under Section 110 of the Companies Act, 2013 read with the Companies (Management and Administration) Rules 2014, was adopted for conducting the Postal Ballot.

Further, details related to the Postal Ballot procedure adopted, voting pattern and result thereof have been provided under the General Body Meetings Section of ‘Report on Corporate Governance’.

CORPORATE GOVERNANCE

Corporate Governance refers to a set of systems, procedures and practices which ensure that the company is managed in the best interest of all corporate stakeholders i.e. shareholders, employees, suppliers, customers and society in general. Fundamentals of Corporate Governance include transparency, accountability and independence.

Your Company views Corporate Governance more as a way of business life than a mere legal obligation. The Company has adopted various practices of governance confirming to highest ethical and responsible standard of business, globally benchmarked. Strong and effective implementation of governance practices in the Company have been rewarded in terms of improved share valuations, stakeholder`s confidence, market capitalization, etc.

A certificate from Practising Company Secretary regarding compliance of the conditions of Corporate Governance, as stipulated under Schedule V of the Listing Regulations is attached as `ANNEXURE-8` and forms part of this Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Directors

As on 31st March, 2018, your Board comprises of 4 Directors including 2 Independent Directors.

Pursuant to Section 149, 152 and other applicable provisions of the Companies Act, 2013, one-third of such of the Directors as are liable to retire by rotation, shall retire every year and, if eligible, offer themselves for re-appointment at every AGM. Consequently, Mr. Rajeev Gupta (DIN 00503196), Director will retire by rotation at the ensuing AGM, and being eligible, offer himself for re-appointment in accordance with provisions of the Companies Act, 2013.

A brief resume of the Director proposed to be re-appointed, the nature of his expertise in specific functional areas, names of companies in which he holds Directorships, committee memberships/chairmanships, their shareholding etc., are furnished in the explanatory statement to the notice of the ensuing AGM. The Directors recommend his re-appointment at the ensuing AGM.

Further, there were no changes in the Directorship of the Company.

The Company has received necessary declaration from all the Independent Directors under Section 149(7) of the Companies Act, 2013 confirming that they meet the criteria of independence as laid down in Section 149(6) of the Companies Act, 2013 and the Listing Regulations.

Board Diversity

As on March 31, 2018, your Board comprises of 4 Directors including 2 Independent Directors and 1 Woman Director. The Company recognizes and embraces the importance of a diverse Board in its success. The Board has also adopted the Board Diversity Policy.

Board Meetings

The Board met 16 times during the Financial Year 2017-18, the details of which are given in the Corporate Governance Report which forms part of this Annual Report. The intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013 and Listing Regulations.

Key Managerial Personnel

In compliance with the requirements of Section 203 of the Companies Act, 2013, Mr. Rajeev Gupta, Managing Director and Chairman, Mr. Abhishek Kedia, Company Secretary and Mr. Inder Prakash Saboo, Chief Financial Officer of the Company are the Key Managerial Personnel of the Company.

Further, there were no changes in the Key Managerial Personnel of the Company.

Policy on Directors` appointment and Policy on remuneration

Pursuant to Section 134(3)(e) and Section 178(3) of the Companies Act, 2013, the Policy on appointment of Board members including criteria for determining qualifications, positive attributes, independence of a Director and the Policy on remuneration of Directors, KMP and other employees is attached as ‘ANNEXURE- 2` to this Report.

It is thereby, affirmed that remuneration paid to the Directors, Key Management Personnel and other employees is as per the Remuneration Policy of the Company.

Performance Evaluation of the Board, its Committees and Individual Directors

Pursuant to applicable provisions of the Companies Act, 2013 and the SEBI (LODR), 2015, the Board, in consultation with its Nomination & Remuneration Committee, has formulated a framework containing, inter-alia, the criteria for performance evaluation of the entire Board of the Company, its Committees and Individual Directors, including Independent Directors.

A structured questionnaire has been prepared, covering various aspects of the functioning of the Board and its Committee, such as, adequacy of the constitution and composition of the Board and its Committees, matters addressed in the Board and Committee meetings, processes followed at the meeting, Board`s focus, regulatory compliances and Corporate Governance, etc.

Similarly, for evaluation of Individual Director’s performance, the questionnaire covers various aspects like his/ her profile, contribution in Board and Committee meetings, execution and performance of specific duties, obligations, regulatory compliances and governance, etc. Board members had submitted their response on a scale of 5 (excellent) – 1 (poor) for evaluating the entire Board, respective Committees of which they are members and of their peer Board members, including Chairman of the Board. The Independent Directors had met separately without the presence of Non-Independent Directors and the members of management and discussed, inter-alia, the performance of non-Independent Directors and Board as a whole and the performance of the Chairman of the Company after taking into consideration the views of executive and Non-Executive Directors.

The Nomination and Remuneration Committee has also carried out evaluation of every Director`s performance. The performance evaluation of all the Independent Directors have been done by the entire Board, excluding the Director being evaluated. On the basis of performance evaluation done by the Board, it shall be determined whether to extend or continue their term of appointment, whenever the respective term expires.

The Directors expressed their satisfaction with the evaluation process.

Familiarisation Programme for Independent Directors

The Company conducts Familiarization Programme for the Independent Directors to enable them to familiarize with the Company, its management and its operations so as to gain a clear understanding of their roles, rights and responsibilities for the purpose of contributing significantly towards the growth of the Company. They are given full opportunity to interact with senior management personnel and are provided with all the documents required and/or sought by them to have a good understanding of the Company, its business model and various operations and the industry, it is a part.

The Policy on Familarisation Programme for Independent Directors is also available on the Company’s website www.rciind.com under the web link http://www.rciind.com/yahoo_site_admin/assets/docs/FamiliarizationProgrammeForIndependentDirector s.pdf.

Further, at the time of appointment of an Independent Director, the Company issues a formal letter of appointment outlining their duties and responsibilities as a Director.

Committees of Board

Currently, the Board has Four standing Committees viz. Audit Committee, Nomination & Remuneration Committee, Stakeholders Relationship Committee and Corporate Social Responsibility Committee. The Audit Committee of the Board comprises of 3 (Three) members, with Mr. Raj Singh Jamwal, Non- Executive Independent Director, as its Chairman. During year under review, all recommendations of the Audit Committee were accepted by the Board of Directors of the Company.

Details of the constitution of these Committees, which are in accordance with regulatory requirements, have been uploaded on the website of the Company viz. www.rciind.com. A detailed note on the Board and its Committees is provided under the Report on Corporate Governance section.

Whistle Blower Policy/ Vigil Mechanism

The Board has adopted a Whistle Blower Policy (Vigil Mechanism) to provide opportunity to Directors/ Employees/ Stakeholders of the Company to report concerns about unethical behavior, actual or suspected fraud of any Director and/or Employee of the Company or any violation of the Code of Conduct.

Further during the year under review, no case was reported under the Vigil Mechanism.

AUDITORS

Statutory Auditors

At the 23rd Annual General Meeting held on Thursday, 24th July, 2014, M/s. RPMD & Associates, Chartered Accountants, (Firm Registration No: 005961C) were appointed as the Statutory Auditors of the Company to hold office from the conclusion of 23rd AGM till the conclusion of the Annual General Meeting to be held in the year 2019, subject to ratification of the appointment by the Members at every AGM held after the 23rd AGM of the Company.

M/s. RPMD & Associates, Chartered Accountants, (Firm Registration No: 005961C) vide their letter dated 21st May, 2018 have resigned from the position of Statutory Auditors of the Company, resulting into a casual vacancy in the office of Statutory Auditors of the Company as envisaged by section 139(8) of the Companies Act, 2013.

The Board of Directors at its meeting held on 25th May, 2018, recommended the appointment of M/s. KRA & Co., Chartered Accountants (Firm Registration No: 020266N) as Statutory Auditors of the Company in place of M/s. RPMD & Associates, Chartered Accountants, (Firm Registration No: 005961C) to hold office from the conclusion of 27th Annual General Meeting till the conclusion of 32^nd Annual General Meeting subject to ratification of their appointment at every Annual General Meeting.

Your Company has received a letter from M/s. KRA & Co., Chartered Accountants (Firm Registration No: 020266N) to the effect that their appointment, if made, would be under the second and third proviso to Section 139 (1) of the Companies Act, 2013 and that they are not disqualified within the meaning of Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014.

The Audit Report given by RPMD & Associates (erstwhile Statutory Auditors) for the financial year 2017-18, forming part of this Annual Report.

Secretarial Auditor

During the year under review, the Board re-appointed Ms. Kiran, Practicing Company Secretary, proprietor of M/s. Kiran & Associates, Company Secretaries, as the Secretarial Auditor of the Company to conduct Secretarial Audit for the financial year 2017-18. The Secretarial Audit was carried out in compliance with Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and the Report thereon in the prescribed form MR-3 is attached as ‘ANNEXURE-3’.

The reports of Statutory Auditor and Secretarial Auditor forming part of this Annual report do not contain any qualification, reservation or adverse remarks. During the year the Statutory Auditors have not reported any matter under Section 143 (12) of the Act, therefore no detail is required to be disclosed under the applicable provisions of the Act.

Internal Auditors

M/s Kiran & Associates, Practicing Company Secretary performs the duties of internal auditors of the Company and their report is reviewed by the audit committee from time to time.

EXTRACT OF ANNUAL RETURN

The extract of Annual Return as on March 31, 2018 in the prescribed Form No. MGT-9, pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014 is attached as `ANNEXURE-1` to this Report.

DISCLOSURES

Particulars of loans, guarantees or investments: Pursuant to the provisions of Section 186 of companies act, 2013 the particulars of loans, guarantees or investments are mentioned in Note No. 2.5 & 2.7 to the Standalone Financial Statements forming the part of annual report.

Borrowings and Debt Servicing: During the year under review, your Company has met all its obligations towards repayment of principal and interest on loans availed.

Related Party Transactions: None of the transactions with related parties fall under the scope of Section 188(1) of the Companies Act, 2013. All transactions with related parties entered during the year were in the Ordinary Course of Business and on Arm’s Length and duly approved by Audit Committee of the company. The company has not entered into any transaction of a material nature with any of the related parties which are in conflict with the interest of the company.

However, as required under Companies Act, 2013 the details of related party transactions are disclosed in prescribed Form No. AOC – 2 which is attached as ANNEXURE–4.

Also, you may refer to Related Party transactions in Note No. 2.30 of the Standalone Financial Statements.

Deposits: Your Company has neither invited nor accepted any public deposit under chapter V of the Companies Act, 2013.

Sexual harassment: The Company has zero tolerance for Sexual Harassment at workplace and has adopted a Policy on prevention of Sexual Harassment in line with the provisions of ‘The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013’ and the Rules made thereunder. There was no complaint on sexual harassment during the year under review.

Regulatory Orders: No significant or material orders were passed by the regulators or courts or tribunals which impact the going concern status and Company’s operations in future.

Material changes and commitments affecting the financial position of the Company: There have been no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of this report.

Buy Back of Securities: The Company has not made any offer for buy back of its securities during the year under review.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS & OUTGO

Conservation of Energy

Your Company, being a manufacturer, trader and exporter of Ferrous and Non-Ferrous Metal products, requires minimal energy consumption and every endeavor is made to ensure optimal use of energy, avoid wastages and conserve energy as far as possible.

Technology Absorption

In its endeavor to deliver the best to its customers, clients and business partners, your Company is constantly active in harnessing and tapping the latest and best technology in the industry.

Foreign Exchange Earning & Outgo

Following are the particulars of Foreign Exchange Earnings and Outgo during the financial year 2017-18:

a). Value of Imports calculated in CIF Basis:

b). Expenditure in Foreign Currency:

c). Earnings in Foreign Currency:

PARTICULARS OF EMPLOYEES

As on March 31, 2018, the total numbers of employees on the records of the Company were 275. The information required under Section 197 of the Companies Act, 2013 (‘Act’) read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, along with statement showing names and other particulars of the top 10 employees in terms of remuneration drawn is annexed to this report as ‘ANNEXURE-6’.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the provisions under Section 134(5) of the Companies Act, 2013, with respect to Directors’ Responsibility Statement, the Directors confirm:

a. That in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed and no material departures have been made from the same;

b. That they had selected such accounting policies and applied them consistently, and made judgements 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 they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

e. That they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

RISK MANAGEMENT SYSTEM & INTERNAL CONTROL SYSTEMS

Your Company has an effective internal control and risk mitigation system, which is constantly assessed and strengthened with standard operating procedures (SOPs) and which ensures that all the assets of the Company are safeguarded and protected against any loss and that all the transactions are properly authorized and recorded. The Company has laid down procedures to inform audit committee and board about the risk assessment and mitigation procedures, to ensure that the management controls risk through means of a properly defined framework. The internal control systems of your Company ensures that all assets are safeguarded and protected against loss from unauthorized use or disposition and those transactions are authorized, recorded and reported correctly.

Your Company has in place adequate internal financial controls with reference to financial statements. Based on internal financial control framework and compliance systems established in the Company, the work performed by statutory, internal and secretarial auditors and reviews performed by the management and/or relevant Audit and other Committees of the Board, your Board is of the opinion that the Company’s internal financial controls were adequate and effective during the financial year 2017-18. During the year, no reportable material weakness in the design or operation was observed.

Properly documented policies, guidelines and procedures are laid down for this purpose. The internal control system has been designed to ensure that the financial and other records are reliable for preparing financial and other statements and for maintaining accountability of assets.

The Company also has an Audit Committee, presently comprising of 3 (three) Members i.e. professionally qualified Directors, who interact with the Statutory Auditors, Internal Auditors and Auditees in dealing with matters within its terms of reference. The Committee inter alia deals with accounting matters, financial reporting and internal controls which also periodically reviews the Risk Management Process.

INSIDER TRADING CODE

In compliance with the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 (‘the PIT Regulations’) on prevention of insider trading, your Company had instituted a comprehensive Code of Conduct for regulating, monitoring and reporting of trading by Insiders. The said Code lays down guidelines, which advise Insiders on the procedures to be followed and disclosures to be made in dealing with the shares of the Company and cautions them on consequences of non-compliances.

Your Company has further put in place a Code of practices and procedures of fair disclosures of unpublished price sensitive information. Both the aforesaid Codes are in line with the PIT Regulations.

INDUSTRIAL OPERATIONS

The Company maintained healthy, cordial and harmonious industrial relations at all levels. The enthusiasm and unstinting efforts of the employees have enabled the Company to remain at the leadership position in the industry. It has taken various steps to improve productivity across the organization.

CAUTIONARY STATEMENT

Statements in this Report, particularly those which relate to Management Discussion and Analysis, describing the Company’s objectives, projections, estimates and expectations, may constitute ‘forward looking statements’ within the meaning of applicable laws and regulations and actual results might differ.

ACKNOWLEDGEMENT

Your Directors would like to express their sincere appreciation for the assistance and co operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the Company’s executives, staff and workers.

For and on behalf of the Board

Sd/-

Mr. Rajeev Gupta

Chairman & Managing Director

DIN 00503196

Place: New Delhi

Date: 25.05.2018

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Mar 31, 2016

TO

THE MEMBERS OF RCI INDUSTRIES & TECHNOLOGIES LIMITED DEAR SHAREHOLDERS.

The Directors are delighted to present their Annual Report on the working of the Company for the period from 1^st April, 2015 to 31^st March, 2016 with audited statements of accounts :-

FINANCIAL RESULTS

The Company''s Financial performance during the year 2015- 16 as compared to the previous year 2014- 15 is summarized below:-

PARTICULARS	2016	2015
TOTAL REVENUE	11,487,847,269	8,425,891,113
TOTAL PROFIT BEFORE TAX	51,878,638	30,574,092
TOTAL PROFIT AFTER TAX	34,679,913	21,858,930

RESERVES & SURPLUS

The Company''s reserve & surplus in the year 2016 is 359,344,900 as compared to the previous year it was 332,761,386.

PERFORMANCE REVIEW

Your Company achieved an all- time high performance both in turnover and its profits. The Gross revenues touched Rs.11, 487,847,269 and the Profit after taxes recorded was Rs.34,679,913. Your Company coupled high level of modernization with, concentrated efforts of both Management and employees, the whole hearted support of Banks, suppliers and customers to attain these levels of performance. The earnings per equity share (of face value Re. 10) for the year 2015- 2016 has increased from Rs.2.01 to Rs.3.18.

DIVIDEND

With a view to provide a cushion for any financial contingencies in the future and to strengthen the financial position of the Company, your Directors have decided not to recommend any dividend for the period under review.

EXTRACT OF ANNUAL RETURN

The extract of Annual Return as on March 31^st, 2016 in the prescribed form no. MGT- 9, pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration ) Rules ,2014 is attached herewith as Annexure I and comprising the part of this Report.

MEETINGS OF BOARD OF DIRECTORS

The Company has held more than minimum board meetings required to be held as per the provision of Companies Act, SEBI (LODR) 2015 and Secretarial Standard issued by ICSI.

CORPORATE SOCIAL RESPONSIBILITY:

Yours Directors are pleased to inform you that from the financial year 2016- 17 CSR is applicable on the company as the Turnover of the company crossed over Rs. 1000 Crs. Hence, Directors during the financial year 2016- 17 constituted the CSR committee of the board to look after the various CSR activities of the company. As you all aware company has specially incorporated the wholly owned subsidiary named RCI Skills & Social Development Private Limited for CSR Activities. All the relevant disclosures related to CSR pursuant to Section 135 of the Companies Act, 2013 will be made in next Annual Report.

COMPOSITION OF CSR COMMITTEE

Pursuance to Section- 135 of the Companies Act,2013, Our Company is required to constitute the Corporate Social Responsibility Committee. The Composition of CSR Committee is as follows:

NAME	DESIGNATION
MR. ANIL KUMAR JAIN	MEMBER
MR. RAJEEV GUPTA	MEMBER
MR. RAJ SINGH JAMWAL	CHAIRMAN

PET ATT ,5 ABOUT THE IMPLEMENTATION OF CSR POLICY

We may undertake the CSR Activities through RCI SKILLS & SOCIAL DEVELOPMENT PRIVATE LIMITED . The projects, programs or activities identified by the CSR Committee and approved by the Board shall be implemented in a project mode through the specialized employees who will entail charting the stages of execution through planned processes, measurable targets, mobilization and allocation of budgets and prescribed timelines. It also involves assigning of responsibility and accountability. Suitable documents / agreements shall be entered into with the skill development authorities and the other agencies for the purposes of implementation of the CSR Activity, in case the CSR Activity is proposed to be implemented through the third party agencies. The conditions of grant of amounts for all CSR Activities and the break- up of the allocations shall be set out and evaluated from time to time.

POLICY ON PTRECTORS APPOINTMENT ANP POLICY ON REMX JNER ATTON

Pursuant to the requirement under Section 134(3)(e) and Section 178(3) of the Companies Act, 2013, the policy on appointment of Board members including criteria for determining qualifications, positive attributes, independence of a Director and the policy on remuneration of Directors, KMP and other employees is attached herewith as Annexure — 2 which forms part of this report.

COMPARISON OF REMUNERATION OF EACH KMP

The difference of remuneration arises due to work experience.

FUTURE PROSPECTUS

Despite stiff competition from other countries, international buyers show preference to your Company''s product for its quality and timely delivery and hence your Directors are confident of achieving better working results in the coming years.

PIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the provisions under Section 134(5) of the Companies Act, 2013, with respect to Directors'' Responsibility Statement, the Directors confirm:

a. That in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed and no material departures have been made from the same;

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

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

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

e. That they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Pursuant to the provisions of Section 186 of companies act, 2013 the particulars of loans, guarantees or investments are mentioned in notes no. 2.12 forming the part of annual report.

DECLARATION BY INDEPENDENT DIRECTORS

Pursuant to the provisions of Section 149 (6) of the Companies Act, 2013 MR. RAJ SINGH JAMWAL & ANIL KUMAR JAIN (INDEPENDENT DIRECTORS OF THE COMPANY) has given the declaration required under Section 134 of the Companies Act, 2013.

RISK MANAGEMENT POLICY

Although the competition is hectic we have an edge over others with our quality and timely execution of orders. The more transit time due to geographical position and adverse movement of foreign exchange rate of the Rupee are major concerns for the growth of the industry. The fluctuation of Rupee against US Dollar, a trend noted during the last quarter of the year may affect the company''s profitability in both short and long term. China, Europe, Japan along with the U.S. (the four largest economies in the world) will largely determine the direction of the global economy through the rest of this year and into 2016- 17.

The good news is that the advanced economies overall will perform more strongly and contribute more to global growth in 2016- 17.

LISTING ON STOCK EXCHANGES

Your Company''s shares are listed on the Bombay Stock Exchange, SME Platform and the company has paid the listing fees for the financial year 2016- 17 including the fees of NSDL &

CORPORATE GOVERNANCE

Your Company has been listed on SME Platform of BSE Limited & According to SEBI(Listing Obligations & Disclosure Requirements) Regulations,2015 the compliance related to the provisions of Corporate Governance is not applicable for Companies Listed on SME Platform of BSE Limited however we are continuing to follow all the corporate governance practice prescribed under SEBI (LODR) Regulation 2015 and Companies Act, 2013. Hence, Separate Corporate Governance Report under Regulation 34 read with Schedule V of SEBI (LODR) Regulation 2015 is not being provided this year however company is providing Management Discussion and Analysis Report which forms a part of this Annual Report.

PARTICULARS OF EMPLOYEES

There is no Employee in respect of whom information required under Companies Act, 2013 is required to be furnished in this report.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

Provisions of the Companies Act, 2013 regarding Conservation of Energy and Technology Absorption do not apply to your Company.

FOREIGN EXCHANGE EARNINGS & OUTGO

The Details of Foreign Exchange Earnings and Outgo during the financial year is mentioned in Notes No. 2.27 to 2.30 of Notes to accounts forming part of Annual report.

DEPOSITS

The Company has neither invited nor accepted any sum falling under the purview of the Companies Act, 2013.

BUY BACK OF SECURITIES

The Company has not made any offer for buy back of its securities during the year under review.

PIRECTORS

In accordance with the Companies Act, 2013, Mr. Rajeev Gupta retires by rotation and being eligible offers himself for reappointment.

KEY MANAGERIAL PERSONNEL

During the period none of the KMP was changed.

PIRECTORS REMUNERATION

The Managing Director was paid remuneration of Rs. 12,00,000 during the year as salary, and perquisites duly approved by shareholders in their meeting and further approved by nomination & remuneration committee of the company and Mrs. Mamta Gupta was not paid any remuneration during the year.

It is thereby, affirmed that remuneration is as per remuneration policy of the company.

PERFORMANCE EVALUATION OF THE BOARD. ITS COMMITTEES ANP INPIVIPUAL PIRECTORS

Pursuant to applicable provisions of the Companies Act, 2013 and the SEBI (LODR), 2015, the Board, in consultation with its Nomination & Remuneration Committee, has formulated a framework containing, inter- alia, the criteria for performance evaluation of the entire Board of the Company, its Committees and Individual Directors, including Independent Directors.

A structured questionnaire has been prepared, covering various aspects of the functioning of the Board and its Committee, such as, adequacy of the constitution and composition of the Board and its Committees, matters addressed in the Board and Committee meetings, processes followed at the meeting, Board''s focus, regulatory compliances and Corporate Governance, etc.

Similarly, for evaluation of Individual Director''s performance, the questionnaire covers various aspects like his/ her profile, contribution in Board and Committee meetings, execution and performance of specific duties, obligations, regulatory compliances and governance, etc. Board members had submitted their response on a scale of 5 (excellent) — 1 (poor) for evaluating the entire Board, respective Committees of which they are members and of their peer Board members, including Chairman of the Board. The Independent Directors had met separately without the presence of Non- Independent Directors and the members of management and discussed, inter- alia, the performance of non- Independent Directors and Board as a whole and the performance of the Chairman of the Company after taking into consideration the views of executive and Non- Executive Directors.

The Nomination and Remuneration Committee has also carried out evaluation of every Director''s performance. The performance evaluation of all the Independent Directors has been done by the entire Board, excluding the Director being evaluated. On the basis of performance evaluation done by the Board, it shall be determined whether to extend or continue their term of appointment, whenever the respective term expires.

The Directors expressed their satisfaction with the evaluation process.

AUDITORS AND THEIR REPORT

M/s RPMD & Associates Chartered Accountants, Independent Auditors of the Company was appointed by the shareholders in 23rd AGM on 24.07.2014 to hold the office from the conclusion of 23rd AGM to 28th AGM subject to rectification by shareholders in each AGM held thereafter. Hence the rectification of the appointment of M/s RPMD & Associates is needed to be done by shareholders in this AGM. The Auditors report is enclosed herewith along with all attachments. There is no qualification and adverse remark in his audit report and further there is no fraud reported by him under Section 143 (12) of the Companies Act,

SECRETARIAL AUDITORS AND THEIR REPORT

The Board has appointed Ms. Kiran, Proprietor of M/s. Kiran And Associates, as a practicing Company Secretary, to conduct Secretarial Audit for the financial year 2015- 2016 pursuant to Section 204 of the Companies Act, 2013. The Secretarial Audit Report submitted by them in the prescribed form MR- 3 is attached as Annexure - 3 and forms part of this report.

There are no qualifications or observations or other remarks of the secretarial auditors in the report issued by them for the financial year 2015- 2016.

CONSOLIDATED FINANCIAL STATEMENTS

In compliance with the applicable provisions of Companies Act, 2013 including the Accounting Standard 21 on Consolidated Financial Statements, this Annual Report also includeslConsolidatedlFinanciallStatementslforlthelfinanciallyearl2015- l16lwhichlincludeslthel Financial Statement of Subsidiaries and Associates Companies. ll

Pursuant to Section 129(3) of the Companies Act, 2013 and Accounting Standard- 21 issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements presented by the Company include the Financial Statements of its Subsidiaries.

The company has not consolidated the financial statement of 2 associates companies (Metalrod Private Limited and Ace Matrix Solutions Limited) as the AS - 21 exempts the consolidation of financial statement of such associates because the investment in shares of associates was acquired as stock in trade and the intention of such investment was to disposed off the same in near future and further Section 129 (3) of the Companies Act, 2013 read with first proviso to Rule 6 of Companies (Accounts) Rules, 2014 which stated that in case of a company covered under sub section (3) of section 129 which is not required to prepare consolidated financial statements under Accounting Standards, it shall be sufficient if the company complies with provision of Consolidated Financial Statements provided in Schedule III of the Act and the company has duly complied with provision of Schedule III of the Act by disclosing the name of associates not consolidated and reason thereof as mentioned above.

Further, a separate statement containing the salient features of the financial statements of subsidiaries/Associates of the Company in the prescribed form AOC- 1 has been disclosed in the Consolidated Financial Statements. In terms of provisions of Section 136 of the Companies Act, 2013, the Company shall place separate audited accounts of the Subsidiary Companies on its website.

The Company will make available physical copies of these documents upon request by any shareholder of the Company/ subsidiary interested in obtaining the same.

These documents shall also be available for inspection at the registered office of the Company during business hours up to the date of ensuing AGM.

INTERNAL FINANCIAL CONTROL SYSTEM

According to Section 134(5)(e) of the Companies Act, 2013 the term Internal Financial Control (IFC) means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business, including adherence to Company''s policies, 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 information.

The Company has a well- placed, proper and adequate internal financial control system which ensures that all assets are safeguarded and protected and that the transactions are authorized, recorded and reported correctly. The Company''s internal financial control system also comprises due compliances with Company''s policies and Standard Operating Procedures (SOPs) and audit and compliance by in- house Internal Audit Division, supplemented by internal audit checks. The Internal Auditors independently evaluate the adequacy of internal controls and concurrently audit the majority of the transactions in value terms. Independence of the audit and compliance is ensured by direct reporting of Internal Audit Division and Internal Auditors to the Audit Committee of the Board.

APEQUACY 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. The system should be designed and operated effectively. 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''s Report. To ensure effective Internal Financial Controls the Company has laid down the following measures:

5- All operations are executed through Standard Operating Procedures (SOPs) in all functional activities for which key manuals have been put in place. The manuals are updated and validated periodically.

- The Company follows a robust 2- tier internal audit process:

Tier- 1: Management/ Strategic/ Proprietary audits are conducted on a regular basis throughout the year as per agreed audit plan.

Tier- 2: Transaction audits are conducted regularly in India and abroad to ensure accuracy of financial reporting, safeguard and protection of all the assets. Stock audit is conducted on quarterly basis at all locations in India. Fixed Asset verification of assets in India is done on an annual basis including AS- 28 testing at all locations. The audit reports for the above audits are compiled and submitted to Management Committee and audit Committee for review and necessary action.

The Company''s books of accounts are maintained in Tally.ERP9 and transactions are executed through required setups to ensure correctness/ effectiveness of all transactions, integrity and reliability of reporting.

- The Company has a comprehensive risk management framework.

- RCI Industries and Technologies Limited has a robust mechanism of building budgets at an integrated cross- functional level. The budgets are reviewed on a monthly basis so as to analyze the performance and take corrective action, wherever required.

- RCI Industries and Technologies Limited has in place a well- defined Whistle Blower Policy/ Vigil Mechanism.

- RCI Industries and Technologies Limited has a system of Internal Business Reviews. All departmental heads discuss their business issues and future plans in monthly review meetings. They review their achievements in quarterly review meetings. Specialized issues like investments, property, FOREX are discussed in their respective Internal Committee meetings.

Compliance of secretarial functions is ensured by way of secretarial audit.

RELATED PARTY TRANSACTIONS

All transactions with related parties were in the ordinary course of business and at arm''s length and duly approved by Audit Committee of the company. The company has not entered into any transaction of a material nature with any of the related parties which are in conflict with the interest of the company.

As required under Companies Act, 2013 the details of related party transactions are disclosed in prescribed form no. AOC — 2 which is attached herewith as Annexure — 4

SUBSIDIARIES/ASSOCIATES COMPANIES

During the year no subsidiary and associates has been incorporated or taken over.

CHANGE IN CAPITAL STRUCTURE AND LISTING OF SHARES

The Company shares are listed on Bombay stock exchange (BSE) and there is no change in the capital structure of the Company.

COMPANY AFFAIRS

Kindly refer to Management Discussion & Analysis Report which forms part of this report

CARRY FORWARD TO RESERVE

The Balance of Profit & Loss Account has been transferred to reserve.

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

In order to prevent sexual harassment of women at work place a new act The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 has been notified. Under the said Act every company is required to set up an Internal Complaints Committee to look into complaints relating to sexual harassment at work place of any women employee.

The Company has duly constituted the said committee to prevent sexual harassment of women at work place and adopted a policy for prevention of Sexual Harassment of Women at workplace The said committee has implemented the said policy and there are no complaints till date for any matter related thereto.

A CKNOWT EDGEMENT

Your Directors would like to express their sincere appreciation for the assistance and cooperation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the Company''s executives, staff and workers. For and on behalf of the Board of Directors

By Order of the Board of Directors

For RCI Industries & Technologies Limited

Sd/-

Mr. Rajeev Gupta

Chairman & Managing Director

DIN 00503196

Date: 03/09/2016