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Directors Report of Relaxo Footwears Ltd.

Mar 31, 2016

Dear Members,

The Board of Directors of Your Company take pleasure in presenting its report on the working of the Company for the Financial Year 2015-16.

1. FINANCIAL RESULTS (Rs. in Crores)

Particulars 2015-16 2014-15

Revenue 1715.27 1481.21

EBITDA 243.34 201.03

Less: Finance Cost 22.89 18.48

Less: Depreciation 47.12 39.90

Add: Exceptional Item 4.26 -

Profit before Tax 177.59 142.65

Less: Tax Expenses 57.31 39.60

Profit after Tax 120.28 103.05

Balance brought forward from Previous year 1.06 5.23

Amount available for Appropriation 121.34 108.28

Appropriation:

Final Dividend 7.20 6.00

Tax on Final Dividend 1.47 1.22

Transfer to General Reserve 110.00 100.00

Balance carried to Balance Sheet 2.67 1.06

EPS-Basic (in Rs.) 10.02 8.59

EPS-Diluted (in Rs.) 10.00 8.58

2. BUSINESS PERFORMANCE

The key highlights of the Company''s financial performance during the Financial Year 2015-16 are given here below:-

- Revenue increased by 15.80% to Rs. 1715.27 Crores from Rs. 1481.21 Crores in the last Financial Year.

- EBITDA increased by 21.05% to Rs. 243.34Crores; EBITDA margins increased by 62 bps to 14.19%.

- Net Profit increased by 16.72% to Rs. 120.28 Crores from Rs. 103.05 Crores in the last Financial Year.

- Net Profit margins increased to 7.01 %.

- Total retail outlets increased from 207 to 250 during the Financial Year.

3. PERFORMANCE OVERVIEW

(A) FINANCIALS

Your Company has been able to show a healthy growth on the key financial metrics for the year, despite the market scenario being uncertain and competitive activity increasing in the year. Your Company continues its journey of profitable growth driven by the strong fundamentals of operating model, overwhelming desire to serve customers and the end consumer and continued focus on the long term business plan.

- Sustained focus on consumer needs and quality

- Focus on value growth along with sustainable volume growth

- Aggressive Expansion in new/ under - penetrated geographies

- Increased presence in new / emerging channels (Modern Trade, E- Commerce)

- Investment on strengthening brands

- Robust cost control with margin improvement initiatives

- Manufacturing Excellence and Quality Improvement

- Identification and Implementation of value creation projects to aid bottom-line improvement

- Strategic procurement of material to maintain profitability

- EBITDA growth driving PAT growth for the Company

(B) NON-FINANCIALS - GROWTH ACROSS THE VALUE CHAIN Consumer Focus/ Product Innovation

Your Company continued its relentless efforts to understand the consumer and has designed its portfolio in line with their changing tastes. Structured market research approach along with regular market sensing exercises have kept Your Company abreast with consumer needs across different regional, economic and demographic strata. Our focus on in- season launches with an optimal product portfolio, has enabled us to deliver right products at right price points at the right time. All our brands - Relaxo, Flite, Sparx and Bahamas have experienced good growth and success with our revised approach on building a targeted portfolio.

New product development is the key driver of consistent growth for our company. We have a very strong in-house design capability, whose endeavor is to constantly innovate techniques to provide cutting edge products at reduced costs. We have also launched an innovation portal for our employees to crowd source the new product design ideas and are also working towards establishing a dedicated R&D function within the organization.

We are bullish on the growth potential from organized retail and e-commerce platforms and have developed a dedicated portfolio to ensure healthy topline contribution from them.

with minimal impact to conventional trade channels. This has been a successful strategy for FY16 and continues to be a focus area for FY17.

Trust in the brand is essential for its growth and we intend to invest heavily to ensure this objective is met. As celebrity marketing has been studied and analyzed to be an effective lever to build trust in the brand, this year we have engaged Salman Khan as the brand ambassador for Bahamas. We believe Salman will successfully convey Bahamas as trendy youthful brand. We have also continued with Akshay Kumar as the brand ambassador for Sparx and Sonakshi Sinha as the brand Ambassador for Flite.

Sales Channel Development

We have successfully implemented end-to-end distributor and retailer programs to improve engagement levels and connect with our channel partners. The distributor engagement program has delivered incremental and sustainable benefits to Relaxo while ensuring a healthy relationship with our channel partners. The retailer based loyalty program has helped in establishing direct connect with retailers and in rewarding their efforts in promoting Relaxo brands.

We have also effectively enhanced our distribution coverage both by strengthening the presence in current regions and expanding across new regions.

We continue to believe Flite PU to be a brand with high potential and have setup initiatives to improve product offerings, manufacturing standards and overall market presence. We will continue to focus on Flite PU brand in FY17. Retail continues to remain instrumental in increasing brand visibility with its 250 stores spread across North and Western India. In FY16, we focused on strengthening the back end infrastructure by improving inventory control and building a flexible supply chain. We have also been successful in adapting changes in technology to upgrade our ERP and reporting platforms. This has led to improved visibility across the system and is supporting better decision making. Our structured store expansion has helped strengthen the Relaxo brand and facilitate a strong connect of the company with the end consumer. We are also in the process of renewing our loyalty reward scheme and enabling digital payment facility for our customers via digital wallets. Our online shopping portal, www.shopatrelaxo.com, has been redesigned and is performing with better conversion rates than initial estimates. In FY17, we plan to rollout a structured cost reduction initiative to optimize spending and improve overall profitability of the Retail business.

With changing global sourcing patterns, international brands are moving towards India from China to fulfill their contract manufacturing requirements. Relaxo is rightly positioned to become a reliable partner for these brands. Branded label contract manufacturing is being looked as a key growth area for Your Company in the medium term. Relaxo branded channel sales across international markets has also strengthened, with Middle East continuing to be our key revenue contributor, owing to widespread Indian diaspora and the Company''s market understanding. We continue to focus on African and Oceania markets as well and are well positioned to capitalize on the next wave of growth from these regions.

Procurement

Your Company was able to manage the material cost owing to effective monitoring of the raw material expenses and easing of prices in the international market. We were able to leverage technology for procurement by using e-auction platform which resulted in cost reduction and improved efficiency.

Manufacturing

In order to support sustainable and profitable growth, we took steps towards manufacturing excellence across key production units. The program aimed at improving productivity and reducing manufacturing costs with the help of world class manufacturing concepts like Lean Manufacturing and Maynard Operation Sequence Technique (MOST) has been rolled out in select plants. We have been successful in controlling manufacturing costs by optimizing manpower utilization, energy consumption and rationalizing miscellaneous, capital & operational expenses. Training & capability development programs for the workforce were implemented to improve operational effectiveness at manufacturing facilities.

We are also fulfilling our commitment towards environment by utilizing alternate sources of energy. We have successfully completed a pilot project to harness power by commissioning a solar unit in one of our plants in Jan''16.

Technology

Technology is the backbone of Your Company and helps in integrating various functions on one platform, thereby, providing efficiencies in operations. Your Company took important initiatives last year to support and transform the front end and back end functions. We have launched a real- time sales automation tool to enable our distributors to place orders and track them. Keeping in line with the technology trends, we are moving towards cloud based solutions to improve overall system resilience and accessibility.

Supply Chain Optimization

Supply chain remains one of the key areas for enabling growth of Your Company. Focused initiatives have been implemented towards improvement in utilization of existing distribution network and optimizing inventory. In order to service our channel partners faster and better. Regional Distribution Center (RDCs) operations have been further strengthened. Forward looking supply and capacity planning has been carried out for both plants and warehouses to support future growth.

We plan to continue to ensure close coordination between Manufacturing, Supply Chain and Sales to ensure on-time fulfillment of demand while maintaining optimum inventory levels. We also plan to continue focusing on fulfilling requirements of our non-distribution channels like Modern Trade, Retail and Exports.

People Focus

Over the last year, the HR function in Your Company has been continuing the transformation journey towards becoming a high performance function. Following key initiatives were delivered in FY16:

a) Culture assessment: Your Company sales and capabilities are growing at a rapid pace. It is imperative that the culture also evolves at a commensurate pace. The current exercise of culture assessment has identified levers & HR interventions are planned to take it to the next level.

b) Employee Stock Options Program (ESOP): Select group of employees, depending upon their nature of job and criticality of the position that they handle, were granted shares in 2014 under the ESOP 2014 scheme (RFL ESOP PLAN -2014). Shares were vested in August 2015 as per the policy.

c) Employee Engagement- Your Company is focused on creating an employee friendly workplace. To increase employee engagement, employees are given forums to raise their issues and look outside of their core role via one-on-one sessions and skip-level sessions. For our workmen, we organized Workmen Family Connect Programs in our Plants.

d) Leadership Development: Crucibles, a Leadership Development Programme, is a fine mix of Classroom Trainings, On the Job Cross Functional Projects and Coaching sessions aimed at developing leaders from within Relaxo. Crucibles was carried out successfully in its second year run.

e) Training and Development: We imparted functional and behavioural trainings for all departments. Last year, we covered 82% of the employees as part of the training program.

f) Reward and Recognition: Recognition programs such as Function wise Star Employee of the Quarter Award has been running successfully.

4. MANAGEMENT DISCUSSION & ANALYSIS REPORT

The Management Discussion & Analysis Report forms an integral part of this Report and gives details of the overall industry structure, developments, performance and state of affairs of the Company''s business, internal controls and their adequacy, risk management systems and other material development during the Financial Year.

5. DIVIDEND

Board of Directors in their meeting held on 14th May, 2016 have recommended a final dividend of 60% i.e. Re 0.60 per equity share for the Financial Year ended 31st March, 2016. The Proposed Dividend is subject to the approval of shareholders at the Annual General Meeting to be held on 15th September, 2016.

6. TRANSFER TO RESERVE

We propose to transfer Net Profit of Rs. 110.00 Crores to the General Reserve. An amount ofRs. 2.67 Crores is proposed to be retained in profit & loss account.

7. PUBLIC DEPOSITS

Your Company has not invited or accepted any Deposits within the meaning of Sections 73 & 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014 from Public during the year under review.

8. CORPORATE GOVERNANCE

The Company is committed to maintain the highest standard of Corporate Governance and adhere to the Corporate Governance requirements set out by SEBI. The Report on Corporate Governance as stipulated under SEBI (LODR) Regulations, 2015 forms an integral part of the Report. The requisite certificate from the Statutory Auditors of the Company M/s Gupta & Dua, Chartered Accountants, confirming compliance with the conditions of Corporate Governance is attached to the Report of Corporate Governance.

9. DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL& PARTICULARS OF EMPLOYEES

In accordance with Section 178 of the Companies Act, 2013 read with rules issued thereunder and Clause 49 of Listing Agreement, the Board of Directors at their meeting held on 10th May, 2014 formulated the Nomination & Remuneration Policy of Your Company. The salient aspects covered in the Nomination and Remuneration Policy, covering the policy on appointment and remuneration of Directors and other matters have been outlined in the Corporate Governance Report which forms part of this Report. The Nomination and Remuneration Policy is available on the website of the Company at the following link http://www.relaxofootwear.com/pdf/Nomination-and- remuneration-policy.pdf.

The information required under Section 197 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Directors/ Employees of Your Company is set out in Annexure -Auto this Report.

10. DIRECTORS AND KEY MANAGERIAL PERSONNEL

During Financial Year 2015-16, Mr. Deval Ganguly was reappointed as Whole Time Director for another period of three years w.e.f. 5th November, 2015 by the Shareholders in the Annual General Meeting held on 24th September, 2015. During the year, Mr. Vikas Kumar Tak was appointed as Company Secretary, pursuant to the provisions of Companies Act, 2013.

Mr. Nikhil Dua, Executive Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible, offered himself for re-appointment.

Your Directors recommend his appointment as the Director of the Company.

The term of Mr. Nikhil Dua as Whole time Director is going to expire on 30th September, 2016. He is to be reappointed for another term of 1 Year w.e.f. 1st October, 2016 if approved by Shareholders in the forthcoming Annual General Meeting.

11. ANNUAL EVALUATION OF BOARD''S PERFORMANCE

In terms of provisions of Companies Act, 2013 read with Rules issued thereunder and SEBI (LODR) Regulations 2015, the Board of Directors on recommendation of the Nomination and Remuneration Committee, have evaluated the effectiveness of the Board/ Director(s) for the Financial Year 2015-16. Directors were evaluated on their contribution at Board/Committee Meetings and guidance/support to the management outside Board /Committee Meetings.

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.

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

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

12. NUMBER OF MEETINGS OF THE BOARD

The Board met six times during the Financial Year, the detail of which is given in the Corporate Governance Report that forms part of this Annual Report. The intervening gap between any two consecutive meetings was within the period prescribed by the Companies Act, 2013.

13. DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration from each Independent Director under Section 149(7) of the Companies Act, 2013 that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013.

14. TRAINING OF INDEPENDENT DIRECTORS

The Company makes presentation to the new Independent Directors about the Company''s strategy, operations, products, organization structure, finance, human resource and facilities. During the year. Company had arranged presentations for the Independent Directors, on the Business Operating Plans, Capital Expenditure Plans, Business Strategy, HR Policies, Outsourcing Strategy, Compliance Process. Further at the time of appointment of an Independent Director, the Company issued a formal letter of appointment outlining his / her role function, duties & responsibilities as an Independent Director. The format of the letter of appointment is available on our website http://www.relaxofootwear.com/terms-condition.aspx.

15. DIRECTOR''S RESPONSIBILITY STATEMENT

Pursuant to Section 134 of the Companies Act, 2013 with regard to Director''s Responsibility Statement, it is hereby confirmed that:

a) in the preparation of the annual accounts for the year ended March 31, 2016, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same.

b) the Directors have 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 as at March 31,2016 and of the profit of the Company for the year ended on that date.

c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) the Directors have prepared the annual accounts on a ''going concern'' basis.

e) the Directors have laid down Internal Financial Controls to be followed by the Company and that such Internal Financial Controls are adequate and are operating effectively and

f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

16. AUDITORS

The Statutory Auditors of the Company M/s. Gupta & Dua, Chartered Accountants hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re- appointment. The Company has received letter from them to the effect that their re-appointment, if made, would be within the prescribed limits under Section 141 (3)(g) of the Companies Act, 2013 and that they are not disqualified for re-appointment.

17. AUDITORS''REPORT

The observation of the Auditors on the Accounts for the year under report have been suitably explained in the Notes to Accounts and do not require any further clarification.

18. SECRETARIAL AUDITOR

Pursuant to the provisions of Section- 204 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Your Company has appointed M/s Vivek Arora, Company Secretaries, to conduct the Secretarial Audit of the Company for the Financial Year 2015-16.The Secretarial Audit Report for the Financial Year 2015-16 forms part of the Annual Report as Annexure-B to the Board''s Report.

19. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT-9 in accordance with Section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, are set out herewith as "Annexure-C" to this Report.

20. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All Contracts / arrangements / transactions entered by the Company during the Financial Year with related parties were in the ordinary course of the business and on the arm''s length basis and were in compliance with the applicable provisions of the Companies Act, 2013 (''the Act''), the Listing Agreement and SEBI (LODR) Regulations 2015. During the year the Company had not entered into any contract/arrangement/ transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of Related Party Transactions that would have required Shareholders approval under Clause 49 of Listing Agreement or Regulation 23 of SEBI (LODR) Regulations 2015.

The policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company''s website at the link http://www.relaxofootwear.com/pdf/policy-for-transactions- with-related-Parties.pdf.

Your Directors draw attention of the members to Note No. 30 to the Financial Statements which sets out related party disclosures.

The form AOC-2 pursuant to section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is set out as Annexure-D to this Report.

21. DETAILS OF LOANS, GUARANTEES & INVESTMENTS

The details of loans, guarantees and investments under Section 186 of the Companies Act, 2013 read with Companies (Meeting of Board and its Powers) Rules, 2014 are as follows :-

a) Details of investments made by the Company as on 31st March, 2016 (including investments made in previous years).

(i) Investment in equity shares Nil

(ii) Investment in debt instruments :Rs. 50.00 Lacs

b). Details of loans given by the Company Nil

c). There are no guarantees issued by Your Company in accordance with Section 186 of the Companies Act, 2013 read with the Rules issued thereunder.

22. RISK MANAGEMENT

Your Company recognizes that risk is an integral part of business and is committed to managing the risks in a proactive and efficient manner. Your Company periodically assesses risks in the internal and external environment, along with the cost of treating risks and incorporates risk treatment plans in its strategy. The Internal Audit Department facilitates the execution of Risk Management Practices in the Company, in the areas of risk identification, assessment, monitoring, mitigation and reporting. The Company has laid down procedures to inform the Audit Committee as well as the Board of Directors about risk assessment & management procedure and status.

The Company has policy to hedge most of the payments of foreign currency in order to reduce risk of volatile international market of foreign exchange.

All properties, including building, plant, machinery, furniture, fixture, stock and stock in transit of the Company have been properly insured against all kind of risks.

23. CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Corporate Social Responsibility committee has recommended to the Board a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, which has been approved by the Board. The Corporate Social Responsibility committee comprises of Mr. Ramesh Kumar Dua - Chairman, Mr. Mukand Lai Dua -Member, Mr. Pankaj Shrimali - Member and Ms. Deepa Verma-Member.

The CSR Policy is available on the Company''s website at the link http://www.relaxofootwear.com/pdf/Corporate-Social- Resonsibility-policy.pdf.

The CSR Policy outlines the CSR vision of Your Company which is based on embedded tenets of trust, fairness and care. The Company during the year paid Rs. 1.62 Crore directly to Prime Minister Relief Fund on 15th July 2015towards the obligation of CSR expenditure due for Financial Year 2014-15.

The Company has formed a society namely Relaxo Foundation to undertake all CSR initiatives of the Company. During the year Relaxo Foundation is in discussion with world renowned NGO''s for construction of public toilets at select utility areas and other activities.

For the Financial Year 2015-16, CSR spending at average net profit of three preceding Financial Years works out to Rs. 2.05 Crores, which has been transferred to Relaxo Foundation for carrying out CSR activities.

The Annual Report of the CSR activities is annexed herewith marked As Annexure-E.

24. COMPOSITION OF AUDIT COMMITTEE

The Audit Committee as on March 31,2016 comprises of the following Directors:

Mr. Pankaj Shrimali (Chairman & Independent Director), Mr. Kuruvila Kuriakose (Independent Director), Mr. Vivek Kumar (Independent Director) and Mr. Nikhil Dua (Executive Director).

Further, all recommendations of Audit Committee were accepted by the Board of Directors.

25. VIGIL MECHANISM

Your Company is committed to highest standards of ethical, moral and legal business conduct. Accordingly, the Board of Directors have formulated a Whistle Blower Policy which is in compliance with the provisions of Section 177(10) of the Companies Act, 2013 and Clause 49 of Listing Agreement. The copy of the policy is available at Company''s website at http://www.relaxofootwear.com/pdf/Vigil-Mechanism- Policy.pdf.

26. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Company has always believed in providing a safe and harassment free workplace for every individual working at Relaxo Foot wears Limited. The Company always tries to create and provide an environment that is free from discrimination and harassment including sexual harassment. A policy on Prevention of Sexual Harassment at Workplace is in place. The policy aims at prevention of harassment of employees and lays down the guidelines for identification, reporting and prevention of undesired behaviour.

An Internal Complaints Committee (ICC) is available at each of the units and offices of the Company as per the requirements of the law. The ICC is responsible for redressal of complaints related to sexual harassment. Your Company has been regularly conducting sensitization sessions for all its employees so as to create awareness about the subject and the law governing the same including their rights of redressal and the punishments applicable in case of any misconduct. The Company has also displayed posters regarding the subject across all plants and offices so as to reinforce the message that Sexual Harassment is a punishable offence.

Your Directors are happy to report that there has been no complaints of Sexual Harassment and it is our constant endeavour to ensure that we provide harassment free, safe and secure working environment to all employees specially for women.

27. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS

There are no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of Your Company and its operation in future. During the year. Company has amicably settled the on-going protracted litigation in respect of Trade Mark "SPARX". The Company has executed and completed all the formalities for assignment of Trade Mark "SPARX" in favour of Relaxo Footwears Limited.

28. CREDIT RATING

During the year under review ICRA has reaffirmed Long term rating of the Company as ICRA A and the outlook for long term rating has been upgraded from stable to positive.

During the year ICRA has upgraded short term rating to A1 and has assigned A1 top notch rating to the Company for commercial paper of Rs. 30.00 Crores.

29. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act, are provided in Annexure-Ftothis Report.

30. EMPLOYEES STOCKOPTION SCHEME

The Nomination & Remuneration Committee of the Board of Directors of the Company interalia, administers and monitors the Employees Stock Option Plan of the Company in accordance with the applicable SEBI Guidelines. The Company currently administers Employee Stock Option Plan 2014 ("RFL ESOP PLAN-2014") for employees of the Company by granting shares thereunder. Accordingly, the ESOP Plan was formulated in accordance with the SEBI Guidelines. The approved ESOP Plan authorized the committee to create, offer and grant 9,00,090 (Nine lac and Ninety only) options of face value of Rs.1.00 to the eligible employees of the Company from time to time in one or more tranches, however subsequent to Bonus Issue in the ratio of 1:1, the total number of available ESOP options have been doubled to 18,00,180 (Eighteen Lac One Hundred and Eighty only) options of face value of Rs.1.00 and simultaneously reducing the Grant Price to half accordingly. The details as per the requirements of SEBI Guidelines are annexed and form part of this Report as Annexure-G.

31. CHANGE IN SHARE CAPITAL

During the year under review, the Company has issued Bonus Shares in the ratio of 1:1 i.e. one bonus share of Rs. 1.00 to every shareholder holding equity share of Rs. 1.00. The total of 6,00,06,000 bonus shares were issued by the Board of Directors in their meeting held on 3rd July, 2015 thereby increasing the share capital by Rs. 6,00,06,000/-.

During the year under review, the Company has issued and allotted 27,700 equity shares of Rs. 1.00 each fully paid up on exercise of stock options by the eligible employees under the Employee Stock Option Plan, 2014 (RFL ESOP PLAN -2014) thereby increasing the paid up share capital By Rs. 27,700/-.

32. 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, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records, and 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 authorised, recorded and reported correctly. The Company''s Internal Financial Control system also comprises of Company''s Policies, Standard Operating Procedures (SOPs), Audit and Compliance by in-house Internal Audit Division. Internal Auditors independently evaluate the adequacy of internal controls, processes and transactions in value terms. Independence of the Internal Audit is ensured by direct reporting to the Audit Committee of the Board.

To further strengthen the internal control process, the Company has developed a very comprehensive Compliance Management Tool with the help of external expert agency which drills down the responsibility of Compliance from top management to executive level. This process is fully automated and generate alerts for proper and timely compliance with regular MIS.

33. CEO AND CFO CERTIFICATION

Pursuant to the requirement of Regulation 33(2)(a) of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, the CEO and CFO certification is attached herewith the Annual Report. The Managing Director and the Chief Financial Officer also provide quarterly certification on Financial Results while placing the Financial Results before the Board in terms of Regulation 33(2)(a) of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015.

34. ACKNOWLEDGEMENT

Your Directors express their gratitude to the Company''s shareholders, business partners and suppliers for their understanding and support. The Directors also take this opportunity to thank Banks, Government and Regulatory Authorities and Stock Exchanges, for their continued support. Finally, Your Directors acknowledge the dedicated services rendered by all employees of the Company.

For and on behalf of the Board of Directors

Ramesh Kumar Dua Mukand Lai Dua

Delhi, 14th May, 2016 Managing Director Whole Time Director


Mar 31, 2015

Dear Members,

The Board of Directors of your Company take pleasure in presenting its report on the working of the Company for the Financial

Year 2014-15.

1. FINANCIAL RESULTS

(Rs.in Crores)

Particulars 2014-15 2013-14

Revenue 1481.21 1214.61

EBITDA 201.03 149.35

Less : Finance Cost 18.48 22.66

Less : Depreciation 39.90 31.16

Profit before Tax 142.65 95.53

Less : Tax Expenses 39.60 29.89

Profit after Tax 103.05 65.64

Balance brought forward from Previous year 5.23 3.10

Amount available for Appropriation 108.28 68.74

Appropriation :

Final Dividend 6.00 3.00

Tax on Final Dividend 1.22 0.51

Transfer to General Reserve 100.00 60.00

Balance carried to Balance Sheet 1.06 5.23

EPS - Basic (in Rs.) 17.17 10.94

EPS - Diluted (in Rs.) 17.15 10.94

2. BUSINESS PERFORMANCE

The key highlights of the Company''s financial performance during the Financial Year 2014-15 are given here below:

* Revenue increased by 21.95% to Rs. 1481.21 Crores from Rs. 1214.61 Crores in the last Financial Year.

* EBITDA increased by 34.60% to Rs. 201.03 Crores; EBITDA margins increased by 128 bps to 13.57%.

* Net Profit increased by 56.99% to Rs. 103.05 Crores from Rs. 65.64 Crores in the last Financial Year.

* Net Profit margins increased by 155 bps to 6.96%

* Total retail outlets increased from 179 to 207 during the Financial Year.

3. PERFORMANCE OVERVIEW

(A). FINANCIALS

Your company has been able to show a strong growth on the key financial metrics for the year, despite the market scenario being uncertain and competitive activity increasing in the year. Your Company continues its journey of profitable growth driven by the strong fundamentals of operating model, overwhelming desire to serve customers and the end consumer and continued focus on the long term business plan.

(B) NON-FINANCIALS - GROWTH ACROSS THE VALUE CHAIN

(i) Consumer Focus / Product Innovation

Your company continued its relentless efforts to understand the consumer and design our portfolio in line with the same. Consumer insights formed the back bone of all our product development efforts. Your Company has strived to understand our consumers across regions and social & economic strata, to come out with market relevant products.

Our portfolio and pricing strategy has evolved over years and last year saw a surge in innovation quotient in our portfolio. All our brands - Hawaii, Flite, Sparx and Schoolmate, have experienced tremendous growth on the back of hugely successful consumer relevant portfolio.

We understand that our brands are at the forefront of bringing the value proposition of our products for our consumers. In line with our strategy, your Company continued to invest heavily behind our brands. During the year, Company engaged Sonakshi Sinha - as the brand ambassador for Flite. We believe that Sonakshi has been successful in conveying the key attributes of style, fashion and colours for our brand, Flite to our consumers. In order to ensure a comprehensive portfolio, covering all consumer needs, Company has also launched a new Bahamas collection - that conveys values of fun and fashion for our consumers.

(ii) Sales Channels Development

Serving our customers well, remains our top priority. To enable sales and distribution growth, regional offices have been set up. Your Company has successfully expanded its distribution footprint in many of hitherto unexplored / under-penetrated territories. Complete end-to-end distributor and retailer programs have also been put in place to improve engagement with our channel partners.

Our retail network has seen a significant growth, both in terms of number of stores (28 during the year) as well as in terms of our approach towards the business. We have been focusing on account category management, a comprehensive portfolio management and capturing shopper insight to enable better and aligned product availability for our consumers. Concentrated expansion plan backed with profitable business case has resulted in significant improvement in our net margins.

Your Company continues investing behind Exports, Modern Trade and E-Commerce business, as we believe that these channels will lead the growth engine from the forefront in times to come.

(iii) Sourcing and Procurement

Your company was able to manage the material cost well within budget owing to effective monitoring of the raw material cost and easing of prices in the international market. We increased our collaboration with key suppliers and focused on competitive bidding of prices.

(iv) Manufacturing Excellence

With the objective of building strong manufacturing foundation to support growth, your Company took further steps towards manufacturing transformation and excellence across key production units. The program aimed at reducing operational complexity, improving process efficiency and reducing manufacturing costs with the help of new-age concepts of Lean Six Sigma and Lean Manufacturing. We have been successful in increasing production capacities and improving efficiency levels. Operational efficiency was attained by utilizing strategies of manpower optimization, energy efficiency, rationalization of capital & operational expenses and capability development of our people.

(v) Supply Chain Optimization

Supply chain remains one of the key area for enabling growth of your company. Company has made significant improvements towards network expansion / utilization and inventory optimization. Efficiencies were brought in the processes of Regional Distribution Centers (RDCs) and we were able to service our channel partners faster and better. Forward looking capacity planning for both factories and warehouses were undertaken to build a platform for future growth.

The close coordination between Manufacturing, Supply Chain Management and Sales ensured optimum level of inventories across the year leading to on-time fulfillment of demand. We have been able to build adaptive processes leading to fulfillment of additional requirements for our targeted channels like Modern Trade, Retail and Exports.

(vi) People Focus

Over the last year, the HR function in Your Company has undertaken an important transformation journey, where it has made several new strides in important areas of Recruitment, Rewards Management, Leadership Development, while at the same time taking first steps towards automating some of the key HR processes. While the journey continues into FY16, our achievements in these areas give us a firm footing to make strategic contributions towards business growth.

a) Recruitment - We have been focused on getting the best talent from the market to enable organization growth. During the year in mention we have enhanced the talent pipeline for open positions by tapping new sources, both internal and external while enhancing our Employee Value Proposition.

b) Rewards Management - We believe that the good organizational performance is driven by its employees. Our journey towards ensuring a lucrative rewards package to our top performing executives was taken forward this year through introduction of Employee Stock Option Plan (ESOP) for senior and top executives.

c) Leadership Development - Your Company launched a Leadership Development Program (LDP) called Crucibles for employees with high leadership potential. Various opportunities provided as part of the program helped the participants to solve complex business problems and provided them an environment to experiment with their ideas.

d) Employee Engagement - Your Company conducted a structured exercise to measure employee engagement levels and are taking steps towards improving employee experience in various areas.

(vii) ISO Certification

As an additional step of our commitment towards environment, your Company has achieved a prestigious certification on ISO 14001:2004 for its four manufacturing plants and will continue to roll it out to the other manufacturing plants.

By implementation of ISO 14001:2004 we are now capable to :

* Quantify, monitor and control the impact of operations on the environment, now and in the future.

* Ensure legislative awareness and compliance in better way.

* Improve environmental performance of supply chain.

* Grow access to business partners and potential customers.

(viii) Standard Operating Procedure (SOPs)

To enhance operational efficiencies and day to day working, formal SOPs (Standard Operating Procedure) preparation was initiated by engaging external professional agency and were successfully implemented during the Financial Year. These SOPs will further yield in future operational benefits, streamline internal processes, enhance efficiencies, optimize utilization of resources along with cost.

4. MANAGEMENT DISCUSSION & ANALYSIS REPORT

The Management Discussion & Analysis forms an integral part of this Report and gives details of the overall industry structure, developments, performance and state of affairs of the Company''s business, internal controls and their adequacy, risk management systems and other material development during the Financial Year.

5. DIVIDEND

Board of Directors in their meeting held on 9th May, 2015 have recommended a final dividend of 100% i.e Rs. 1.00 per equity share (equivalent to Rs. 0.50 per share post 1:1 bonus issue) for the Financial Year ended March 31, 2015. The bonus issue was subsequently approved by the Shareholders

through the postal ballot on 22nd June, 2015. The proposed dividend is subject to the approval of shareholders at the Annual General Meeting to be held on 24th September, 2015.

6. BONUS ISSUE

Board of Directors in their meeting held on 9th May, 2015 have declared bonus issue in the ratio of 1:1 i.e one bonus share of Rs. 1.00 to every shareholder holding equity Share of Rs. 1.00. The bonus issue was approved by the Shareholders through the Postal Ballot on 22nd June, 2015. The allotment of the bonus issue has been made in the Board Meeting held on 3rd July, 2015 to all the shareholders of the Company holding shares on the record date i.e 2nd July, 2015.

7. TRANSFER TO RESERVE

We propose to transfer Net Profit of Rs.100.00 Crores to the General Reserve. An amount of Rs.1.06 Crores is proposed to be retained in profit and loss account.

8. PUBLIC DEPOSITS

Your Company has not invited or accepted any Deposits within the meaning of Sections 73 & 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014 from Public during the year under review.

9. CORPORATE GOVERNANCE

The Company is committed to maintain the highest standard of Corporate Governance and adhere to the Corporate Governance requirements set out by SEBI. The Report on Corporate Governance as stipulated under listing agreement forms an integral part of the Report. The requisite certificate from the Statutory Auditors of the Company M/s Gupta & Dua, Chartered Accountants, confirming compliance with the conditions of corporate governance is attached to the report of Corporate Governance.

10. DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS, KEY MANAGEMENT PERSONNEL & PARTICULARS OF EMPLOYEES

In accordance with Section 178 of the Companies Act, 2013 read with rules issued thereunder and Clause 49 of the Listing Agreement, the Board of Directors at their meeting held on 10th May, 2014 formulated the Nomination & Remuneration Policy of your Company. The salient aspects covered in the Nomination and Remuneration Policy, covering the policy on appointment and remuneration of Directors and other matters have been outlined in the Corporate Governance Report which forms part of this Report. The Nomination and Remuneration Policy is available on the website of the Company at the following link http://www.relaxofootwear.com/pdf/Nomination-and-remuneration-policy. pdf.

The information required under Section 197 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Directors / employees of your Company is set out in Annexure -A to this report.

11. DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the year Mr. Umesh Nath Kapur Independent Director of the Company expressed his inability to continue as Director and ceased to be Director w.e.f 29th July, 2014.

During Financial Year 2014-15, members approved appointment of Mr. Pankaj Shrimali, Mr. Vivek Kumar, Mr. Kuruvila Kuriakose and Ms. Deepa Verma as Independent Directors for a period of five years till 31st March, 2019 who are not liable to retire by rotation. Ms. Deepa Verma was also appointed as Woman Director during the year pursuant to the provisions of Companies Act, 2013 & Listing Agreement.

During the year Mr. Sushil Batra, Chief Financial Officer (CFO) of the Company was designated as Key Managerial Person pursuant to the Provisions of Companies Act, 2013.

Mr. Ramesh Kumar Dua Managing Director and Mr. Mukand Lal Dua Whole Time Director of the Company retire by rotation at the ensuing Annual General Meeting and, being eligible, offered themselves for re-appointment.

Your Directors recommend their appointment as the Directors of the Company.

Mr. Deval Ganguly was appointed as Whole Time Director for a term of 3 years w.e.f 5th November, 2012. He is to be reappointed for another term of 3 years w.e.f 5th November, 2015 if approved by shareholders in the forthcoming Annual General Meeting.

12. ANNUAL EVALUATION OF BOARD''S PERFORMANCE

In terms of provisions of Companies Act, 2013 read with Rules issued thereunder and Clause 49 of Listing Agreement, the Board of Directors on recommendation of the Nomination and Remuneration Committee, have evaluated the effectiveness of the Board/ Director(s) for the Financial Year 2014-15.

13. NUMBER OF MEETINGS OF THE BOARD

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

14. DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration from each Independent Director under Section 149(7) of the Companies Act, 2013 that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and clause 49 of Listing Agreement.

15. TRAINING OF INDEPENDENT DIRECTORS

Every new Independent Director of the Board is briefed about the Company background, its vision and goals. The Company executive make presentation to the new inductee about the Company''s strategy, operations, products, organization structure, finance, human resource and facilities. The Company had arranged presentations for the Independent Directors, on the Company law and other applicable laws on the Company.

Further at the time of appointment of an independent Director, the Company issued a formal letter of appointment outlining his/ her role function, duties & responsibilities as a Director. The format of the letter of appointment is available on our website http://www.relaxofootwear.com/terms- conditions.aspx

16. DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Section 134 of the Companies Act, 2013 with regard to Directors'' Responsibility Statement, it is hereby confirmed:

a) in the preparation of the annual accounts for the year ended 31st March, 2015, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;

b) the Directors have 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 as at 31st March, 2015 and of the profit of the Company for the year ended on that date;

c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) the Directors have prepared the annual accounts on a ''going concern'' basis;

e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

17. AUDITORS

The Statutory Auditors of the Company M/s. Gupta & Dua, Chartered Accountants hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. The Company has received letter from them to the effect that their re appointment, if made, would be within the prescribed limits under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified for re-appointment.

18. AUDITORS'' REPORT

The observation of the Auditors on the Accounts for the year under report have been suitably explained in the Notes to Accounts and do not require any further clarification.

19. SECRETARIAL AUDITORS

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company has appointed M/s Vivek Arora, Company Secretaries, to conduct the secretarial audit of the Company for the Financial Year 2014-15. The secretarial audit report for the Financial Year 2014-15 forms part of the Annual Report as Annexure-B to the Board''s Report.

20. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT-9 in accordance with Section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, are set out herewith as Annexure - C to this Report.

21. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All contracts / arrangements / transactions entered by the Company during the Financial Year with related parties were in the ordinary course of the business and on the arm''s length basis. During the year the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of Related Party Transactions.

The policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company''s website at the link http://www.relaxofootwear.com/pdf/Policy-for-Transactions- with-related Parties.pdf

Your Directors draw attention of the members to Note No. 31 to the financial statements which sets out related party disclosures.

The form AOC-2 pursuant to section 134(3)(h) of the Companies Act, 2013 read with Rule 8 (2) of the Companies (Accounts) Rules, 2014 is set out as Annexure-D to this report.

22. DETAILS OF LOANS & GUARANTEES

The details of loans, guarantees and investments under Section 186 of the Companies Act, 2013 read with Companies (Meeting of Board and its Powers) Rules, 2014 are as follows :-

a) Details of investments made by the Company as on 31st March, 2015 (including investments made in previous years).

(i) Investment in equity shares Rs. 0.06 Crores in Relaxo Rubber Private Limited

(ii) Investment in debt instruments : NIL

b) Details of loans given by the Company : NIL

c) There are no guarantees issued by your Company in accordance with Section 186 of the Companies Act, 2013 read with the Rules issued thereunder.

23. RISK MANAGEMENT

Your Company recognizes that risk is an integral part of business and is committed to manage the risks in a pro-active and efficient manner. Your Company periodically assesses risks in the internal and external environment, along with the cost of treating risks and incorporates risk treatment plans in its strategy. The Internal Audit Department facilitates the execution of Risk Management Practices in the Company, in the areas of risk identification, assessment, monitoring, mitigation and reporting. The Company has laid down procedures to inform the Audit Committee as well as the Board of Directors about risk assessment & management procedure and status.

The Company has policy to hedge payment of foreign currency in order to reduce risk of volatile international market of foreign exchange.

All properties, including building, plant, machinery, furniture, fixture, stock and stock in transit of the Company have been properly insured against all kind of risks.

24. CORPORATE SOCIAL RESPONSIBILITY (CSR)

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

The CSR Policy may be accessed on the Company''s website at the link http://www.relaxofootwear.com/pdf/Corporate-SocialResponsibility-Policy .pdf.

The CSR Policy outlines the CSR vision of your Company which is based on embedded tenets of trust, fairness and care.

The Company is also in the process of formation of society for the purpose of CSR activities and is planning to take all CSR initiatives through the society.

The Annual Report of the CSR activities is annexed herewith marked as Annexure-E.

25. VIGIL MECHANISM

Your Company is committed to highest standards of ethical, moral and legal business conduct. Accordingly, the Board of Directors have formulated a Whistle Blower Policy which is in compliance with the provisions of Section 177(10) of the Companies Act, 2013 and Clause 49 of Listing Agreement. The copy of the policy is available at Company''s website at link at http://www.relaxofootwear.com/pdf/Vigil-Mechanism- Policy.pdf.

26. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Company has always believed in providing a safe and harassment free workplace for every individual working at Relaxo Footwears Limited. The Company always tries to create and provide an environment that is free from discrimination and harassment including sexual harassment.

A policy on Prevention of Sexual Harassment at workplace was released during the last Financial Year ended 31st March 2015. The policy aims at prevention of harassment of employees and lays down the guidelines for identification, reporting and prevention of undesired behaviour. An Internal Complaints Committee (ICC) was set up at each of the units and offices of the Company as per the requirements of the law.

The ICC is responsible for redressal of complaints related to sexual harassment.

Moreover, your Company has been regularly conducting sensitization sessions for all its employees so as to create awareness about the subject and the law governing the same including their rights of redressal and the punishments applicable in case of any misconduct.

Your Directors are happy to report that there has been no complaint of Sexual Harassment and it is our constant endeavour to ensure that we provide harassment free, safe and secure working environment to all employees specially for women.

27. SIGNIFICANT MATERIAL ORDERS PASSED BY THE REGULATORS

There are no significant / material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of your Company and its operation in future.

28. CREDIT RATING

The ICRA has reaffirmed Long term rating of the Company as ICRA A and the outlook for long term rating has been upgraded from stable to positive.

The short term rating of your Company has been upgraded from ICRA A1 to ICRA A1 which is top notch rating and reflects strong credit quality of the Company.

Particulars Revised Rating Previous Rating

Short Term Rating A1 A1

Long Term Rating A with positive A with stable outlook outlook

29. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUT GO

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act, are provided in Annexure-F to this Report.

30. EMPLOYEES STOCK OPTION PLAN

The Nomination & Remuneration Committee of the Board of Directors of the Company interalia, administers and monitors the Employees Stock Option Plan of the Company in accordance with the applicable SEBI Guidelines. The Company instituted the Employee Stock Option Plan 2014 ("RFL ESOP PLAN-2014") for employees of the Company by granting shares thereunder. Accordingly, the ESOP Plan was formulated in accordance with the SEBI Guidelines. The ESOP Plan was approved by the members on 5th, August 2014, through a postal ballot. The approved ESOP plan authorizes the committee to create, offer and grant 900090 (Nine lac and Ninety only) options of face value of Rs. 1.00 to the eligible employees of the Company from time to time in one or more tranches. The details as per the requirements of SEBI Guidelines are annexed and form part of this Report as Annexure-G.

31. CEO AND CFO CERTIFICATION

Pursuant to the requirement of Clause 49 of the Listing Agreement, the CEO and CFO certification is attached herewith, the Annual Report. The Managing Director and the Chief Financial Officer also provide quarterly certification on financial results while placing the financial results before the Board in terms of Clause 41 of the Listing Agreement.

32. ACKNOWLEDGMENT

Your Directors express their gratitude to the Company''s shareholders, business partners and suppliers for their understanding and support. The Directors also take this opportunity to thank Banks, Government & Regulatory Authorities and Stock Exchanges, for their continued support. Finally, your Directors acknowledge the dedicated services rendered by all employees of the Company.

For and on behalf of the Board of Directors

Ramesh Kumar Dua Mukand Lal Dua

Managing Director Whole Time Director

Delhi, 25th July, 2015


Mar 31, 2014

Dear Members,

The Board of Directors of your Company take pleasure in presenting its report on the working of the Company for the Financial Year 2013-14.

1. FINANCIAL RESULTS

(Rs in lacs)

Particulars 2013-14 2012-13

Sales & Other Income 121461.17 101090.97

Total Expenditure 108791.51 91772.31

Profit before Depreciation & Tax 12669.66 9318.66

Depreciation 3116.47 2549.82

Profit before Tax 9553.19 6768.84

Payment/Provision for Tax 2989.55 2288.02

Profit after Tax 6563.64 4480.82

Balance brought forward from Previous year 310.46 610.45

Amount available for Appropriation 6874.10 5091.27

Appropriation :

Final Dividend 300.03 240.02

Tax on Final Dividend 50.99 40.79

Transfer to General Reserve 6000.00 4500.00

Balance carried to Balance Sheet 523.08 310.46

TOTAL 6874.10 5091.27

Basic and Diluted Earnings per Share of Rs. 1/- each (in Rs.) 10.94 7.47

2. BUSINESS PERFORMANCE

Your Company has demonstrated the resilience of its business model amidst operating in a volatile and uncertain industrial environment. The key highlights of the Company''s financial performance during the financial year 2013-14 are given here below:-

- Net Sales increased by 20.0% to Rs. 120582.95 lacs

- EBITDA increased by 34.7% to Rs. 14935.53 lacs; EBITDA margins increased by 135 bps to 12.39%

- Net Profit increased by 46.5% to Rs. 6563.64 lacs; Net Profit margins increased by 98 bps to 5.44%

- Total retail outlets increased from 168 to 179 during FY14

Your Company has recently initiated modern trade through institutional sales and online shopping access to the customers, to boost sales and have presence in all trade options.

Parivartan, a strategic initiative targeted towards improving operating effciency was undertaken by Relaxo in the year and it has been making contributions in improving the productivity.

3. DIVIDEND

Your Directors are pleased to recommend dividend of Rs. 0.50 per share i.e. 50% on equity share of Rs.1/- each for the financial year 2013-14.

4. AUDITORS

The Statutory Auditors of the Company M/s. Gupta & Dua, Chartered Accountants hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have given their consent to act as Statutory Auditors of the Company for the financial year 2014-15. Further, they have also confirmed that they do not suffer from any disqualifications prescribed under section 141 of the Companies Act, 2013.

5. AUDITORS'' REPORT

The observation of the Auditors on the Accounts for the year under report have been suitably explained in the Notes to Accounts and do not require any further clarifcation.

6. DIRECTORS

Mr. Deval Ganguly, Whole Time Director of the Company will retire at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment.

Pursuant to provision of section 149 and other applicable provisions of Companies Act, 2013, Independent Directors are required to be appointed for a term of five consecutive years and shall not be liable to retire by rotation. Accordingly Mr. Vivek Kumar, Mr. Pankaj Shrimali and Mr. Kuruvila Kuriakose existing Independent Directors being eligible and have given their consent to act as Independent Director.

However, Mr. Umesh Nath Kapur had expressed his inability to continue as Director of the Company.

Further in order to comply the requirement of appointing a women director under section 149 of Companies Act, 2013, the Board of Directors have proposed the appointment of Ms. Deepa Verma as an Independent Director of the Company. She is eligible and has also given her consent to act as an Independent Director of the Company.

Your Directors recommend their appointment as the Directors of the Company.

7. RELATED PARTY TRANSACTIONS

The appointments of Mr. Ritesh Dua as Executive Vice President (Finance), Mr. Gaurav Dua, as Executive Vice President (Marketing), Mr. Nitin Dua, Executive Vice President (Retail) and Mr. Rahul Dua, Executive (Manufacturing) fall under the related party transactions as Defined under Companies Act, 2013. The transaction required members approval by way of special resolution and hence the Board has decided to seek member''s approval at the ensuing AGM. The justifcation of above mentioned appointments has been given here below:- Mr. Ritesh Dua is qualified MBA from Fore School of Management. He is specialized in mobilizing fund based and non fund based requirement of the Company. He deals with the financial institutions and banks for meeting fund based and non fund based requirement of the Company. He has strengthened Direct and Indirect Tax system by implementing good strategy and planning. He has also played pivotal role in expanding Export turnover of the Company that resulted in international recognition of footwears manufactured by the Company.

Mr. Gaurav Dua is qualified MBA (Marketing) from University of Wales, Cardiff. He has been a distinct personality as far as vision planning and results are concerned. He played instrumental role in the product development and diversifcation as a result of which the company has good number of product range in all segment of footwears. His vision of Sales and Marketing''s strategy lead to new path of heights in terms of enhancement of turnover of the Company. The turnover of the Company has touched new heights in last three years.

Mr. Nitin Dua is qualified MBA (Marketing) from Appejay Institute of Management. He conceived the idea and plan for entering into RETAIL chain. He laid down and formulated the vision and plans for opening the retail chain. The same has direct impact on the turnover of the Company. It helped to display the entire range of footwears manufactured by the Company at one place as a result of which the awareness in respect of fashionable and qualitative footwears manufactured by the Company spread among the customers. It resulted positive impact in the establishment of brand and goodwill of the Company.

Mr. Rahul Dua is B.Com (H). He has played an instrumental role in setting up plant for High Fashionable Footwear with state of art PU technology with additional features of longevity, skid-resistance, light weight. His credential efforts have helped the Company to increase the sale of PU based technology footwear which has got instant acceptance and appreciation from customers.

8. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report as required under Clause 49 of the Listing Agreement with the Stock Exchanges forms part of this Report.

9. CREDIT RATING

The ICRA and CARE have assigned the rating A1 for short term fund facility and A for long term fund facility to your Company. These ratings represent adequate safety of credit facilities given to the Company.

10. CORPORATE GOVERNANCE REPORT

The Corporate Governance Report as stipulated under Clause 49 of the Listing Agreement, forms part of this Report.

The requisite certifcate from the Statutory Auditors of the Company, M/s. Gupta & Dua, Chartered Accountants, confirming compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49 is attached to Corporate Governance Report.

11. FIXED DEPOSITS

The Company has not invited or accepted any Fixed Deposits from Public during the year under review.

12. DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Companies Act, 1956 with regard to Directors'' Responsibility Statement, it is hereby confirmed:

1. That the applicable Accounting Standards have been followed in the preparation of the Annual Accounts and that there have been no material departures there from.

2. That the Directors have selected such accounting policies and applied them consistently and made judgement 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 2013- 14 and of the Profit of the Company for year under review.

3. That the Directors have taken proper and suffcient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safe-guarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. That the Directors have prepared the Annual Accounts on a going concern basis.

13. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUT GO

The particulars as prescribed under section 217(1)(e) of the Companies Act, 1956 read with Companies [Disclosure of Particulars in the report of Board of Directors] Rules, 1988, are set out in Annexure forming part of the Directors'' Report.

14. EMPLOYEES STOCK OPTION SCHEME

Your Company has been consistently growing year to year in terms of turnover, Profit, production and number of employees of the Company. The main challenge before the Company is to retain its key employees for a longer period of time to serve the goals of the Company. Accordingly it was decided to implement Employees Stock Option Scheme in the Company that would help to retain the productive talent in the Company and would give motivation to key employees of the Company for their effective contribution in the growth of the Company.

In this regard, the Board had already given in-principle approval for Employees Stock Option Scheme (ESOS) to be executed in one or more tranches subject to approval of Shareholders. In this scheme maximum 1.50 % equity shares of issued, subscribed and paid up capital may be offered to eligible employees.

Further, the shareholders of the Company have also given their consent by passing special resolution through postal ballot for implementation of "RFL ESOP PLAN-2014" that would boost the morale of key employees of the Company and would bring among them a sense of ownership

in the Company in order to deliver their best in efficient manner so as to achieve goals and objectives of the Company within a stipulated time period.

15. SUPPLY CHAIN MANAGEMENT

Supply Chain Management plays a vital role in your Company by meeting the deadlines well from the beginning till the end. During the year under review, it was considered feasible to further improve the benchmark of working effciency and strengthening the existing control system in Supply Chain Management in view of future growth and expansion of the Company. In this regard following goal oriented steps were taken by the Company.

Your Company has opened four more Regional Distribution Centre (RDC) at Guwahati, Cuttack, Ranchi and Lucknow to cater to the demand of distance customers by way of dispatching our manufacturing footwears at right time and right place. Further your Company has outsourced functioning of its Central Distribution Centre (CDC) in order to improve working effciency that is resulting high productivity in professional manner.

To keep pace with the current growth rate and future expansion of the Company in the years to come, your company has built its 1.60 lacs Sq ft warehouse at Bahadurgarh, Haryana with all modern apparatus, machines and latest technical facilities which shall be operational during current financial year.

Your Company has also streamlined its transporter operation through the transport module in SAP which is adding transparency and quality in the existing control system of Supply Chain Management.

16. FINANCIAL RISK

The Company has policy to hedge payment of foreign currency in order to reduce risk of volatile international market of foreign exchange. All properties, including building, plant, machinery, furniture, fixture and stock of the Company have been properly insured against all kind of risks.

Further, the Company has obtained a separate insurance policy to cover any peril which may arise on account of incoming and outgoing movement of raw material/ fnished goods across its manufacturing units upto the places of distributors respectively.

17. HUMAN RESOURCE MANAGEMENT & INDUSTRIAL RELATIONS

Successful HR is the foundation of any successful Business. To enhance it''s HR effectiveness, Relaxo has made significant investments in transforming the HR function. Several HR processes and systems including talent acquisition, performance management, rewards management and talent development have been redesigned in line with business needs and leading market practices. The Industrial Relations in all the manufacturing units of the Company continued to be cordial during the year under review.

18. CEO AND CFO CERTIFICATION

Pursuant to the requirement of Clause 49 of the Listing Agreement, the CEO and CFO certification is attached herewith the Annual Report. The Managing Director & CEO and the Chief Financial officer also provide quarterly certification on financial results while placing the financial results before the Board in terms of Clause 41 of the Listing Agreement.

19. PARTICULARS OF EMPLOYEES

The Statement of Particulars pursuant to section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Amendment Rules, 2002 forms part of this report. However, as per the provisions of Section 219 (1) (b) (iv) of the Companies Act, 1956, the Reports and Accounts are being sent to all shareholders excluding the above statement. The statement is available for inspection at the Registered office during working hours up to the date of the Annual General Meeting or may write to the Company Secretary for a copy.

20. ACKNOWLEDGEMENT

Your Directors express their gratitude to the Company''s shareholders, business partners and suppliers for their understanding and support. The Directors also take this opportunity to thank Banks, Government and Regulatory Authorities and Stock Exchanges, for their continued support. Finally, your Directors acknowledge the dedicated services rendered by all employees of the Company.

For and on behalf of the Board of Directors

Ramesh Kumar Dua Mukand Lal Dua Delhi, 9th August, 2014 Managing Director Whole Time Director


Mar 31, 2013

Dear Members,

The Board of Directors of your Company take pleasure in presenting its report on the working of the Company for the Financial Year 2012-13.

1. FINANCIAL RESULTS

(Rs.in Lacs)

Particulars: 2012-13 2011-12

Sales & Other Income 101090.97 86573.20

Total Expenditure 91772.31 78910.26

Profit before Depreciation & Tax 9318.66 7662.94

Depreciation 2549.82 2310.29

Profit before Tax & Extra 6768.84 5352.65

Ordinary items

Extra Ordinary items (3.83)

Profit before Tax 6768.84 5348.82

Payment/Provision for Tax 2288.02 1358.32

Profit after Tax 4480.82 3990.50

Balance brought forward 610.45 329.17 from Previous year

Amount available for 5091.27 4319.67

Appropriation

Appropriation :

Final Dividend 240.02 180.02

Tax on Final Dividend 40.79 29.20

Transfer to General Reserve 4500.00 3500.00

Balance carried to Balance Sheet 310.46 610.45

TOTAL 5091.27 4319.67

Basic and Diluted Earning 37.34 33.25 per Share (in Rs.)

2. BUSINESS PERFORMANCE

The total revenue of your Company increased to Rs.101090.97 lacs as against Rs.86573.20 lacs in the previous year which reflects growth of 16.77%. The EBIDTA rose by 16.40% to Rs.11088.95 lacs as compared to Rs. 9526.29 lacs in previous year. The earning per share increased from Rs.33.25 to Rs.37.34 on equity share of Rs.5 /- each.

The consistent performance over a long period of time despite growing complexities in the industry and economy indicates that company is a growth driven entity. During the year under review, the Synergy realised in financial term due to softening in raw material price gave an opportunity to spend more on initiatives as to futuristic growth.

The Retail business registered growth of 18.07% to Rs.7225.33 lacs compared to Rs.6119.42 lacs in previous year, During the year under review, the retail business continued its growth journey with new outlet launches realigning and consolidating small ones thus making 168 outlets at the end of FY13.The export business achieved turnover of Rs.3003.70 lacs against Rs.3052.82 lacs last year, which remained almost at par due to overall weak sentiments across the world.

3. DIVIDEND

Your Directors are pleased to recommend dividend of 40% on the equity shares of the Company for the financial year 2012-13.

4. AUDITORS

The Statutory Auditors of the Company M/s. Gupta & Dua, Chartered Accountants hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re- appointment. They have furnished the requisite certificate to the effect that their re-appointment, if effected, will be in accordance with Section 224(1B) of the Companies Act, 1956.

5. COST AUDITOR

During the financial year 2012-13, Ministry of Corporate Affairs has issued Orders under section 233B of the Companies Act and also issued some Circulars in this regard. As a result of which, Cost Audit become applicable on the Company for the financial year 2013-14. Hence, to conduct the Cost Audit, M/s. R.J. Goel & Co., Cost Accountants have been appointed as Cost Auditors by the Board of Directors of the Company. The Cost Audit Report for the financial year 2013-14 will be filed in due course.

6. AUDITORS'' REPORT

The observation of the Auditors on the Accounts for the year under report have been suitably explained in the Notes to Accounts and do not require any further clarification.

7. DIRECTORS

In order to strengthen existing Board of Directors, Mr. Kuruvila Kuriakose and Mr. Umesh Nath Kapur were appointed as Additional Director of the Company with effect from 05.11.2012. Further, Mr. Deval Ganguly was appointed as Additional Director and subsequently appointed as Whole Time Director of the Company with effect from 5.11.2012.

Mr. S.K. Sapra, Director of the Company resigned w.e.f. 21.10.2012.

Mr. Vivek Kumar and Mr. Pankaj Shrimali , Directors of the Company retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re- appointment.

Your Directors recommend their appointment as the Directors of the Company.

8. MANAGEMENT DISCUSSION & ANALYSIS REPORT

The Management Discussion and Analysis Report as required under Clause 49 of the Listing Agreement with the Stock Exchanges forms part of this Report.

9. NEW PRODUCT DEVELOPMENT

During the year under review, the Company has given more emphasis upon New Product Development in order to keep its products ahead in fast changing fashionable and competitive market. The Company has adopted product engineering and rationalisation by focusing upon latest design and quality. To achieve the desired result, the Company carried out extensive market research on its product and also obtained feedback of customers thereon. This step has been leading towards increase in sales of products which are of latest designs and more in demand. Consequently, it resulted into brand recognition of the Company.

10. CREDIT RATING

The ICRA and CARE have assigned the rating A- for long term fund facility and A2 for short term fund facility to your Company. These ratings represent adequate safety of credit facilities given to the Company.

11. CORPORATE GOVERNANCE REPORT

The Corporate Governance Report as stipulated under Clause 49 of the Listing Agreement, forms part of this Report.

The requisite certificate from the Statutory Auditors of the Company, M/s. Gupta & Dua, Chartered Accountants, confirming compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49, is attached to Corporate Governance Report.

12. FIXED DEPOSITS

The Company has not invited or accepted any Fixed Deposits from Public during the year under review.

13. DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Companies Act, 1956 with regard to Directors'' Responsibility Statement, it is hereby confirmed:

1. That the applicable Accounting Standards have been followed in the preparation of the Annual Accounts and that there have been no material departures there from;

2. 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 of the Company at the end of the financial year 2012-13 and of the profit of the Company for year under review.

3. That 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 for safe-guarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. That the Directors have prepared the Annual Accounts on a going concern basis.

14. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUT GO

The particulars as prescribed under section 217(1)(e) of the Companies Act, 1956 read with Companies [Disclosure of Particulars in the report of Board of Directors] Rules, 1988, are set out in Annexure forming part of the Directors'' Report.

15. FINANCIAL RISK

The Company has policy to hedge payment of foreign currency in order to reduce risk of volatile international market of foreign exchange.

All properties, including building, plant, machinery, furniture, fixture and stock of the Company have been properly insured against all kind of risks.

Further, the Company has obtained a separate insurance policy to cover any peril which may arise on account of incoming and outgoing movement of raw material/ finished goods across its manufacturing units and the places of distributors respectively.

16. HUMAN RESOURCE MANAGEMENT & INDUSTRIAL RELATIONS

Manpower management is an integral part of the process of the management of a business. At Relaxo, Human Resource Managers interpret the progressive needs of the organization and direct individual potential towards a common goal.

The Company took initiatives to organize sales and retail trainings at very frequent intervals. To enhance the capability of existing manpower, the Company has tied up with the educational institutions like FDDI, CFTI, MG University. The Company has facilitated the educational enhancement of around 100 employees in the previous year. As a part of talent building initiative the company has recruited talents from various IIT and IIM Institutes across India. The Company has been continuously hiring professionals in all facets from Manufacturing to Sales for building a strong talent pool of future Managers and Leaders.

17. CEO AND CFO CERTIFICATION

Pursuant to the requirement of Clause 49 of the Listing Agreement, the CEO and CFO certification is attached herewith the Annual Report. The Managing Director & CEO and the Chief Financial Officer also provide quarterly certification on financial results while placing the financial results before the Board in terms of Clause 41 of the Listing Agreement.

18. PARTICULARS OF EMPLOYEES

The Statement of Particulars pursuant to section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Amendment Rules, 2002 forms part of this report. However, as per the provisions of Section 219 (1) (b) (iv) of the Companies Act, 1956, the Reports and Accounts are being sent to all shareholders excluding the above statement. The statement is available for inspection at the Registered Office during working hours up to the date of the Annual General Meeting or may write to the Company Secretary for a copy.

19. ACKNOWLEDGEMENT

Your Directors express their gratitude to the Company''s shareholders, business partners and suppliers for their understanding and support. Your Directors record their appreciation and gratitude to the banks for their continued and timely assistance in meeting the Company''s resource requirement. Finally, your Directors acknowledge the dedicated services rendered by all employees of the Company.

For and on behalf of the Board of Directors

RAMESH KUMAR DUA MUKAND LAL DUA

Managing Director Whole Time Director

Place: Delhi Date: July 27, 2013


Mar 31, 2012

The Board of Directors of your Company take pleasure in presenting its report on the working of the Company for the Financial Year 2011-12.

1 FINANCIAL RESULTS

(Rs. in Lacs)

Particulars: 2011-12 2010-11

Sales & Other Income 86573.20 69213.20

Total Expenditure 78910.26 63563.29

Profit before Depreciation & Tax 7662.94 5649.91

Depreciation 2310.29 2095.48

Profit before Tax & Extra 5352.65 3554.43

Ordinary items

Extra Ordinary items 3.83 -

Profit before Tax 5348.82 3554.43

Payment / Provision for Tax 1358.32 883.12

Profit after Tax 3990.50 2671.31

Balance brought forward from 329.17 859.59

Previous year

Prior Period Adjustment - 7.73

Amount available for 4319.67 3538.63

Appropriation

Appropriation :

Final Dividend 180.02 120.01

Tax on Final Dividend 29.20 19.47

Interim Dividend - 60.01

Tax on Interim Dividend - 9.97

Transfer to General Reserve 3500.00 3000.00

Balance carried to Balance 610.45 329.17 Sheet

TOTAL 4319.67 3538.63

Basic and Diluted Earning per 33.25 22.26 Share (in Rs.)

2. BUSINESS PERFORMANCE

During the year under review, the Company performed well, inspite of difficult conditions prevailing in the domestic and world market for greater part of the year, total Revenue achieved Rs.86573.20 lacs as against Rs.69213.20 lacs in previous year which reflects growth of 25%.The EBIDTA rose by 31% to Rs.9526.29 lacs as compared to Rs.7240.76 lacs in previous year. The Earning per Share increased from Rs.22.26 to Rs.33.25 on Equity Share of Rs.5/- each.

The key raw materials used in the manufacturing of footwear are Rubber & EVA. Due to the unprecedented price volatility during the major part of the year, the increased costs could not be recovered to its fullest. However, during the last quarter, the prices of the said materials started declining and dropped significantly. This impact was quite noticeable in the last quarter, resulting in an overall increase in the profit. The improvement on the profit was also yielded due to timely sales realizations, effective cost rationalization in marketing cost and overheads.

The Retail business contributed Rs.6119.42 lacs as compared to Rs.4592.36 lacs in total revenue of the Company. During the year under review, 25 outlets were added making the total to 149.

The Company resulted growth of 36% in export turnover by achieving an export turnover of Rs.3052.82 lacs as against Rs.2208.21 lacs in previous year. The Company successfully participated in Expo Riva Shoe Fair in Italy to showcase its products and prospective buyers appreciated the quality and designs. The Company has been directly exporting to sixteen countries. The Council of Leather Export of India has conferred upon the Company an award of 2nd largest non leather exporter for the financial year 2010-11.

3. DIVIDEND

Your Directors are pleased to recommend a dividend of 30% on the equity shares of the Company for the financial year 2011-12.

4. AUDITORS

The Statutory Auditors of the Company M/s. Gupta & Dua, Chartered Accountants hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They Have furnished there quisite certificate to the effect that their re-appointment, if effected, will be in accordance with Section 224(1B) of the Companies Act, 1956.

5. AUDITORS' REPORT

The observation of the Auditors on the Accounts for the year under report have been suitably explained in the Notes to Accounts and do not require any further clarification.

6. DIRECTORS

Mr. S.K. Sapraand Mr. Nikhil Dua, Directors of the Company retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

Your Directors recommend their appointment as the Directors of the Company .

7. MANAGEMENT DISCUSSION & ANALYSIS REPORT

The Management Discussion and Analysis Report as required under Clause 49 of the Listing Agreement with the Stock Exchanges forms part of this Report.

8. PU PROJECT

It is High Fashionable and formal footwear on PU (Poly Urethane) technology with additional features of longevity, skid resistance and light weight. The Company has already launched this product range under Flite PU - Fashion in one of the existing plant and is getting good response from the end customer. Further, your Company is in advance stage of commissioning a full fledged manufacturing unit in current financial year.

9. LOGISTIC

To synchronise with the pace of growth of the Company, Logistic department is being revamped by adding up distribution infrastructure. It has played pivotal role in the growth of the Company. It ensures availability of right goods at right place at right time. The company has effective logistic department which is supported by five warehouse across India. The Company received 'Supply Chain Leader 2011' award from Industry 2.0 Technology Management Magazine.

10. CREDIT RATING

The ICRA and CARE have assigned the rating A- for long term fund facility and A2 for short term fund facility to your Company. These ratings represent adequate safety of credit facilities given to the Company.

11. CORPORATE GOVERNANCE REPORT

The Corporate Governance Report as stipulated under Clause 49 of the Listing Agreement, forms part of this Report.

The requisite certificate from the Statutory Auditors of the Company, M/s. Gupta & Dua, Chartered Accountants, confirming compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49, is attached to Corporate Governance Report.

12. FIXED DEPOSITS

The Company has not invited or accepted any Fixed Deposits from Public during the year under review.

13. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Companies Act, 1956 with regard to Directors' Responsibility Statement, it is hereby confirmed :

1. That the applicable Accounting Standards have been followed in the preparation of the Annual Accounts and that there have been no material departures there from;

2. 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 of the Company at the end of the financial year and of the profit of the Company for year under review.

3. That 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 for safe-guarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. That the Directors have prepared the Annual Accounts on a going concern basis.

14. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUT GO

The particulars as prescribed under section 217(1)(e) of the Companies Act, 1956 read with Companies [Disclosure of Particulars in the report of Board of Directors] Rules, 1988, are set out in Annexure forming part of the Directors Report.

15. FINANCIAL RISK

The Company has policy to hedge payment of foreign currency in order to reduce risk of volatile international market of foreign exchange.

All properties, including building, plant, machinery, furniture, fixture and stocks of the Company have been properly insured against all kind of risks.

16. HUMAN RESOURCE MANAGEMENT & INDUSTRIAL RELATIONS

The Company stayed focused on overall development of its human capital by organizing training and development programs to boost up the morale of employees and to maintain work life balance. The Industrial Relations in all the units of the Company remained cordial during the year under review. The Company has also provided opportunities to willing workers to upgrade their basic educational qualification at different levels-matriculation/ ITI/Diploma and graduation. The company has commenced hiring professionals in all facets from Manufacturing to Sales for building a strong talent pool of future Managers and Leaders.

17. CEO AND CFO CERTIFICATION

Pursuant to the requirement of Clause 49 of the Listing Agreement, the CEO and CFO certification is attached herewith the Annual Report. The Managing Director & CEO and the Chief Financial Officer also provide quarterly certification on financial results while placing the financial results before the Board in terms of Clause 41 of the Listing Agreement.

18. PARTICULARS OF EMPLOYEES

The Statement of Particulars pursuant to section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Amendment Rules, 2002 forms part of this report. However, as per the provisions of Section 219 (1) (b) (iv) of the Companies Act, 1956, the Reports and Accounts are being sent to all shareholders excluding the above statement. The statement is available for inspection at the Registered Office during working hours up to the date of the Annual General Meeting or may write to the Company Secretary for a copy.

19. ACKNOWLEDGEMENT

Your Directors express their gratitude to the Company's shareholders, business partners and suppliers for their understanding and support. Your Director's record their appreciation and gratitude to the banks for their continued and timely assistance in meeting the Company's resource requirement. Finally, your Directors acknowledge the dedicated services rendered by all employees of the Company.

For and on behalf of the Board of Directors

RAMESH KUMAR DUA MUKAND LAL DUA

Managing Director Whole Time Director

Place : Delhi

Date : May 12, 2012


Mar 31, 2011

Dear Members,

The Board of Directors of your Company take pleasure in presenting its report on the working of the Company for the Financial Year 2010-11.

1. FINANCIAL RESULTS (Rs. in Lacs)

Particulars: 2010-11 2009-10

Sales & Other Income 69213.20 55781.93

Total Expenditure 63560.09 48857.13

Profit before Depreciation & Tax 5653.11 6924.80

Depreciation 2095.48 1545.70

Profit before Tax & Extra Ordinary items 3557.63 5379.10

Extra Ordinary items - (1.22)

Profit before Tax 3557.63 5377.88

Payment/Provision for Tax 886.32 1608.66

Profit after Tax 2671.31 3769.22

Balance brought forward from Previous year 859.59 1293.36

Prior Period Adjustment 7.73 7.16

Amount available for Appropriation 3538.63 5069.74

Appropriation :

Final Dividend 120.01 120.01

Tax on Final Dividend 19.47 19.93

Interim Dividend 60.01 60.01

Tax on Interim Dividend 9.97 10.20

Transfer to General Reserve 3000.00 4000.00

Balance carried to Balance Sheet 329.17 859.59

TOTAL 3538.63 5069.74

Basic and Diluted Earning per Share Rs. 22.26 31.41

2. OPERATIONS

During the year under review, the Company recorded a Gross Income of Rs. 692.13 Crores against Rs. 557.82 Crores in previous year i.e an increase of 24%. However, Net Profit after Tax has decreased from Rs. 37.69 Crores to Rs. 26.71 Crores due to constant increase in material cost during the year.

Now, the Company is optimistic and striving in order to maintain adequate margin in forthcoming years.

3. DIVIDEND

Your Directors are pleased to recommend a dividend of 20% on the equity shares of the Company for the financial year 2010-11 in addition to 10% Interim Dividend paid during the year.

4. AUDITORS

The Statutory Auditors of the Company M/s. Gupta & Dua, Chartered Accountants hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have furnished the requisite certificate to the effect that their re-appointment, if effected, will be in accordance with Section 224(1B) of the Companies Act, 1956.

The Statutory Auditors of the Company changed their firm's name from M/s. Gupta & Jhunjhunwala to M/s. Gupta & Dua, Chartered Accountants during the current financial year.

5. AUDITORS' REPORT

The observation of the Auditors on the Accounts for the year under report have been suitably explained in the Notes to Accounts and do not require any further clarification.

6. DIRECTORS

Mr. Vivek Kumar and Mr. Pankaj Shrimali, Directors of the Company retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

Your Directors recommend their appointment as the Directors of the Company .

7. MANAGEMENT DISCUSSION & ANALYSIS REPORT

The Management Discussion and Analysis Report as required under Clause 49 of the Listing Agreement with the Stock Exchanges forms part of this Report.

8. CORPORATE GOVERNANCE REPORT

The Corporate Governance Report as stipulated under Clause 49 of the Listing Agreement, forms part of this Report.

The requisite certificate from the Statutory Auditors of the Company, M/s. Gupta & Dua, Chartered Accountants, confirming compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49, is attached to Corporate Governance Report.

9. FIXED DEPOSITS

The Company has not invited or accepted any Fixed Deposits from Public during the year under review.

10. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Companies Act, 1956 with regard to Directors' Responsibility Statement. It is hereby confirmed :-1. That the applicable Accounting Standards have been followed in the preparation of the Annual Accounts and that there have no material departures there from;

2. 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 of the Company at the end of the financial year and of the profit of the Company for year under review.

3. That 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 for safe-guarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. That the Directors have prepared the Annual Accounts on a going concern basis.

11. CONSERVATION OF ENERGY, TECHNOLOGY, ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUT GO;

The particulars as prescribed under section 217(1)(e) of the Companies Act, 1956 read with Companies [Disclosure of Particulars in the report of Board of Directors] Rules, 1988, are set out in Annexure forming part of the Directors' Report.

12. LISTING AT NATIONAL STOCK EXCHANGE

Your Directors are pleased to inform that Equity shares of the Company has been listed on National Stock Exchange of India Limited with effect from 17.06.2011 in addition to existing listing with Bombay Stock Exchange Limited.

13. FINANCIAL RISK

The Company has policy to hedge payment of foreign currency in order to reduce risk of volatile international market of foreign exchange.

All properties, including building, plant, machinery, furniture, fixture and stocks of the Company have been properly insured against all kind of risks.

14. HUMAN RESOURCE MANAGEMENT & INDUSTRIAL RELATIONS

The Company during the year organized training and development to boost up the morale of employees, maintain work life balance and to create a feeling of team work to develop capabilities to enhance its leadership in the talent domain. Areas of focus have been leadership development, sales and quality of services. The Industrial Relations in all the units of the Company continued to be cordial during the year under review.

15. CEO AND CFO CERTIFICATION

Pursuant to the requirement of Clause 49 of the Listing Agreement, the CEO and CFO certification is attached herewith the Annual Report. The Managing Director & CEO and the Chief Financial Officer also provide quarterly certification on financial results while placing the financial results before the Board in terms of Clause 41 of the Listing Agreement.

16. PARTICULARS OF EMPLOYEES

The Statement of Particulars pursuant to section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Amendment Rules, 2002 forms part of this report. However, as per the provisions of Section 219 (1) (b) (iv) of the Companies Act, 1956, the Reports and Accounts are being sent to all shareholders excluding the above statement. The statement is available for inspection at the Registered Office during working hours up to the date of the Annual General Meeting or write to the Company Secretary for a copy.

17. ACKNOWLEDGEMENT

Your Directors express their gratitude to the Company's shareholders, business partners and suppliers for their understanding and support. Your Director's record their appreciation and gratitude to the banks for their continued and timely assistance in meeting the Company's resource requirement. Finally, your Directors acknowledge the dedicated services rendered by all employees of the Company.

For and on behalf of the Board of Directors

RAMESH KUMAR DUA MUKAND LAL DUA

Managing Director Whole Time Director

Place: Delhi

Dated: July 30, 2011




Mar 31, 2010

The Board of Directors of your Company take pleasure in presenting its report on the working of the Company for the Financial Year 2009-10.

1. FINANCIAL RESULTS

(Rs. in Lacs)

Particulars : 2009-10 2008-09

Sales & Other Income 55781.93 41004.86

Total Expenditure 48857.13 37519.50

Profit before Depreciation & Tax 6924.80 3485.36

Depreciation 1545.70 1047.01

Profit before Tax & Extra Ordinary items 5379.10 2438.35

Extra Ordinary Items 1.22 40.32

Profit before Tax 5377.88 2398.03

Payment / Provision for Tax 1608.66 974.80

Profit after Tax 3769.22 1423.23

Balance brought forward from previous year 1293.36 725.44

Prior Period Adjustment 7.16 -

Amount available for Appropriation 5069.74 2148.67 Appropriation :

Final Dividend 120.01 90.01

Tax on Final Dividend 19.93 15.30

Interim Dividend 60.01 - Tax on Interim Dividend 10.20 -

Transfer to General Reserve 4000.00 750.00

Balance carried to Balance Sheet 859.59 1293.36

TOTAL 5069.74 2148.67

Basic and Diluted Earning Per Share 31.41 11.86

2. DIVIDEND

Your Directors have paid interim Dividend of 10% on equity shares of the Company for the financial year 2009- 10. Further, your Directors recommend a dividend of 20% on the equity shares of the Company for the year under review.

3. RESERVES

The reserves at the beginning of the financial year 2009-10 were Rs.6796.40 Lacs and the reserves at the end of the financial year 2009-10 are 10392.63 Lacs.

4. AUDITORS

The Statutory Auditors of the Company M/s. Gupta & Jhunjhunwala, Chartered Accountants hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have furnished the requisite certificate to the effect that their re-appointment, if effected, will be in accordance with Section 224(1B) of the Companies Act, 1956.

5. AUDITORS REPORT

The observations of the Auditors on the Accounts for the year under report have been suitably explained in the Notes to Accounts and do not require any further clarification.

6. DIRECTORS

The Board deeply condoles the sad demise of Mr. G.C. Rastogi, Independent Director of the Company and prays for peace to departed divine soul. The Board takes on record his valuable contribution made to the Company during his tenure of office.

Mr. S.K. Sapra, Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment.

Mr. Pankaj Shrimali was appointed as an Additional Director at the meeting of the Board of Directors held on 29th May, 2010 in order to maintain combination of Executive Director and Non Executive Independent Director as per clause 49 of Listing Agreement. He holds office of Directorship upto the date of the ensuing Annual General Meeting. The Company has received notice under section 257 from a member proposing his appointment as Director liable to retire by rotation.

The Board decided to re-appoint Mr. Nikhil Dua, Whole-time Director on revised terms and conditions as approved by Remuneration Committee.

Your Directors recommend their appointment as the Director of the Company.

7. CORPORATE GOVERNANCE

The Company has taken the requisite steps to comply with the recommendations concerning the Corporate Governance. A Report on Corporate Governance together with a certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under clause 49 of the Listing Agreement is annexed to this Report.

8. FIXED DEPOSITS

The Company has not raised any money by way of Fixed Deposits under section 58A of the Companies Act, 1956 during the year and review.

9. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Companies Act, 1956 with regard to Directors Responsibility Statement, it is hereby confirmed:-

1. That the applicable Accounting Standards have been followed in the preparation of the Annual Accounts for the financial year 2009-10, and that there have been no material departures there from;

2. 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 of the Company at the end of the Financial Year 2010 and of the profit of the Company for the year and review.

3. That 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 for safe-guarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. That the Directors have prepared the Annual Accounts on a going concern basis.

10. CONSERVATION OF ENERGY, TECHNOLOGY, ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO :

A. CONSERVATION OF ENERGY

The provisions of Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 regarding the conservation of energy are not applicable to our Company.

B. TECHNOLOGY ABSORPTION

I. RESEARCH AND DEVELOPMENT

a) Specific areas in which R & D carried out by the Company :

- Import substitution of various components and spares.

- Product / process development.

- Waste recycling.

- Raw material & Chemical substitution.

b) Benefits derived as a result of R & D

- Improvement in quality.

- Development of new product / process.

c) Expenditure on R & D

- Expenses of Rs. 5.56 Lacs have been incurred for R & D.

II. TECHNOLOGY ABSORPTION, ADAPTATION & INNOVATION

a) Efforts made towards technology

- Introduction of low shrinkage footwear.

- Introduction of light weight footwear.

b) Benefits derived as a result of the above efforts

- Better market acceptance.

- Improvement in quality.

- Reduction in process cycle time.

- Reduction in wastage & process losses.

- Reduction in overall cost of production.

c) Technology imported during last five years NIL

C. FOREIGN EXCHANGE EARNINGS AND OUTGO

a) Activities relating to export initiatives taken to increase exports, development of new export for products and export plans: The Company has developed markets of Middle East, Europe, & Africa and these markets will increase overall export of Company in coming years.

b) Total Foreign Currency used and earned

Used Rs.3142.66 Lacs

Earned Rs. 1058.21 Lacs

11. RENEWABLE ENERGY AND CONSERVATION OF ENERGY

The world is seriously concerned with the matter of global warming and consequential impact of the global economy and the environment. It was felt necessary for your Company to undertake initiatives to support the global movement combating the adverse impact. As awared corporate, your Company has set up 6 MW Wind Turbine Generators during financial year 2009-10. One of the greatest advantages of Wind Energy is that it is ample and renewable. The other advantages of Wind Energy is that it is widely distributed, cheap, and also reduces toxic gas emissions in the environment.

12. INFORMATION TECHNOLOGY

SAP has been implemented in your Company covering all manufacturing units of the Company in order to run your enterprise in accordance with strategy and plans, accessing the right information in real time. Among other benefits, SAP will improve operational efficiency and productivity within and beyond your Company.

13. INCREASE IN PRODUCTION CAPACITY

The Company increased production capacity by 15000 pairs per day in existing plants and 10000 pair per day by putting up a new Plant at Bahadurgarh, Haryana during the financial year 2009-10.

14. INCREASE IN RETAIL OUTLETS

The heightened awareness of products among consumers is a "golden mantra of Sales. The Company has so far opened 100 retail outlets covering NCR, Punjab, Haryana, Uttaranchal and Gujarat. This is part of our endeavor to create many more one-stop shops displaying our entire range of footwear. The roll-out of these retail outlets is directly influencing consumer demand and turnover of the Company.

15. FOREIGN EXCHANGE RISK MANAGEMENT

The Company has policy to hedge the payment of foreign currency in order to reduce risk of volatile international market of foreign exchange.

16. INSURANCE

All properties, including building, plant, machineries, furniture, fixture and stocks of the Company have been properly insured against all kind of risks.

17. HUMAN RESOURCES MANAGEMENT & INDUSTRIAL RELATIONS

The Company during the year organised training and development programmes to boost up the morale of employees, maintain work life balance and to create a feeling of team-work to develop capabilities to enhance its leadership in the talent domain. Areas for focus have been leadership development, sales and quality of services. The Industrial Relations in all the units of the Company continued to be cordial during the year under review.

18. ENVIRONMENT AND SAFETY

The Company is committed to ensure health and safety to all employees, visitors and any other person present at the work place of the Company. Adequate measures for safe guarding the safety and health of employees and labourers are installed at the plants of Company. The Company installs fire fighting equipments at all manufacturing plants. Workers /staff are trained to handle these equipments effectively in case of any eventuality.

19. CEO AND CFO CERTIFICATION

Pursuant to the requirement of Clause 49 of the Listing Agreement, the CEO and CFO certification is attached with the Annual Report. The Managing Director & CEO and the Chief Financial Officer also provide quarterly certification on financial results while placing the financial results before the Board in terms of Clause 41 of the Listing Agreement.

20. QUALITY MANAGEMENT

Your Company has been certified for ISO 9001:2000 by British Standards Institute (B.S.I.). This certification enables an organization to improve product quality and enhance productivity. This assessment signifies your Companys capability to manage and control manufacturing process for efficient production and supply of quality products to its customers in domestic as well as in international market.

21. PARTICULARS OF EMPLOYEES IN TERMS OF SECTION 217 (2A) OF THE COMPANIES ACT, 1956

The Statement of Particulars pursuant to section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Amendment Rules, 2002, forms part of this report. However, as per the provisions of Section 219 (1) (b) (iv) of the Companies Act, 1956, the Reports and Accounts are being sent to all shareholders excluding the above statement. The statement is available for inspection at the Registered Office during working hours upto the date of the Annual General Meeting or write to the Company Secretary for a copy.

22. APPRECIATION

Your Directors express their gratitude to the Companys shareholders, business partners and suppliers for their understanding and support. Your Directors record their appreciation and gratitude to the banks for their continued and timely assistance in meeting the Companys resource requirement. Finally, your Directors acknowledge the dedicated services rendered by all employees of the Company.

For and on behalf of the Board of Directors

Place : Delhi RAMESH KUMAR DUA MUKAND LAL DUA

Date : May 29, 2010 Managing Director Whole Time Director



 
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