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Directors Report of Sudar Industries Ltd.

Mar 31, 2015

Dear Members,

Your Directors take pleasure in presenting the 14th Annual Report of the Company together with the Audited Statement of Audited Accounts and the Auditors' Report for the financial year ended, 31st March, 2015.

1. FOREWORD :

The Indian economy as you all will agree has experienced a deceleration in economic growth during the period under review. In turn your company had to face challenges in inflationary market conditions and the company had a very difficult time in realizing their logical outstanding dues from the esteemed customers which has in turn has a consequential effect of not meeting the commitments to the working capital lenders. This is in spite of the non release of the assessed need based working capital limits and non realization of dues from our customers. The company is striving to make efforts by conserving the available inputs with the company to return in full flow in its garment and chemical business. Due to the present financial crunch, your company has requested its esteemed suppliers that their payment is secured and it takes some time to clear their dues and we appreciate that the response is positive. To overcome the present crisis your company has already made an application to the Government of Maharashtra explaining in detail the position of the company and has requested for the required support and are awaiting a positive response from the State Government which will give an additional strength to your company to come out of the crisis being faced by your company.

2. HIGHLIGHTS OF PERFORMANCE:

* Your company has a consolidated turnover of Rs. 94,446 Lakhs as against Rs. 92,730 Lakhs in the previous year i.e. an increase of 1.85% as compared to the previous year.

* Operating EBITDA decreased in 2015 by 5,431 Lakhs to Rs. 5,258 Lakhs from 10,289 Lakhs in 2014.

* Consolidated profit before tax in 2015 is Rs. 137 Lakhs, against Rs. 6,538 Lakhs in 2014. Similarly consolidated profit after tax is Rs. 121 Lakhs as against Rs. 4,565 Lakhs in 2014.

* The financial year 2014-2015 was a challenging year amidst global economic uncertainties and recession.

3. FINANCIAL RESULTS

This fiscal has been quite challenging in terms of growth and profitability. Rupee Devaluation, overall market conditions, slow recoveries from customers has adversely affected on the business activities of the Company. We are quite confident that this change and the exports of Iron ore stack, Minerals etc. will enable the company to maintain our growth trajectory in the future.

The financial highlights for the financial year are given below:

(Rs. in Lakhs)

PARTICULARS F.Y. 2014 -15 F.Y. 2013 -14

Sales & Other Income 94,446.34 92,729.70

Profit (Loss) before Interest, Tax, 5,257.92 10,689.40 Depreciation and Exceptional Items

Less: Depreciation 1,149.21 1300.90

Less: Interest Charges 3971.91 2850.86

Proft/(Loss) before exceptional and 136.80 6537.64 extraordinary items and Taxation

Add/(Less) : Exceptional Items - -

Profit (Loss) before Taxation 136.80 6537.64

Less : Provision for Taxation

* Current Year 28.74 1972.59

* Deferred Tax (added back for -12.73 current year)

* Previous Year Tax

Profit (Loss) after Taxation 120.79 4565.05

Balance of P&L A/c brought forward 9885.50 5320.45

Less: Appropriations 6725.11 -

Balance Carried to Balance Sheet 3,281.18 9885.50

Earnings Per Share (Rs. per share) 0.54 20.29

4. BUSINESS OUTLOOK :

Sudar Industries Limited (SIL) is an Integrated Apparel Manufacturing Company with its factory located at Khalapur Taluka, Dist. Raigad. The Company is also into Chemical Segment manufacturing fine chemicals providing intermediate products for pharmaceutical and agro chemical industries. Due to challenging economic conditions, the present business is facing some difficulties in its operations but at the same time the company is strategizing its efforts to excel.

5. DIVIDEND:

Your Directors regret their inability to recommend any dividend for the financial year 2014-15 due to challenging economic conditions and furtherance to negative bottom line.

6. DIRECTORS AND KEY MANAGERIAL PERSONNELS (KMP):

It has been the endeavor of your Company to place a lot of emphasis on its people which includes Employees, Directors and Customers. Your company believes that business being competitive in all spheres of activities, it is only competitive and competent people who can ensure that the Company marches in its road plan for attaining growth and prosperity.

Pursuant to the provisions of clause 49 of the Listing Agreement and the Companies Act, 2013 (Act) the Company has adequate numbers of executive, non-executive and Independent directors and the Board of the Company is properly constituted. Considering the present financial situation and the long term perspective, the Board of Directors of the Company are of the opinion that it is in the interest of the Company to reconstitute its Board and consequently the Board is planning to take necessary steps in this regard.

The Company has received declarations under section 149(7) of the Act from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Companies Act, 2013 and clause 49 of the Listing Agreement. The company has also received Form MBP 1 relating to the disclosure of interest by directors as per the provisions of section 184 and Form DIR 8 stating that they are not disqualified for appointment as per the provisions of section 164 of the Companies Act, 2013 from all the Directors.

The members had approved the appointment of Mr. Murugan M. Thevar as Managing Director of the Company for a period of 5 years with effect from April 01, 2010. The term of appointment of Mr. Murugan M. Thevar ended on March 31,2015. Subject to the approval of the members, the Board of Directors in their meeting held on March 31, 2015 has re-appointed Mr. Murugan M. Thevar as a Managing Director of the Company for a further period of 3 years with effect from April 01,2015.

The members had approved the appointment of Mr. Gopi C. Nair as a Whole Time Director for a period of 5 years with effect from June 01,2010. The term of appointment of Mr. Gopi C. Nair ended on May 31,2015. Subject to the approval of the members, the Board of Directors in their meeting held on March 31,2015 has re-appointed Mr. Gopi C. Nair as a Whole Time Director of the Company for a further period of 3 years with effect from June 01,2015.

Mr. Srinivas Kamath retires by rotation and being eligible offers himself for re-appointment at the ensuing Annual General Meeting.

In order to comply with the provisions of the section 149 of the Companies Act, 2013 and various provisions of the listing agreement pertaining to the Corporate Governance, the Board of Directors of the Company in their meeting held on March 31, 2015 has appointed Ms. Yogita Shetty, as a Woman Independent Director on the Board of the Company, subject to the approval of members in the ensuing Annual General Meeting.

Necessary resolutions for the appointment/re-appointment of the aforesaid Directors have been included in the Notice convening the ensuing Annual General Meeting and details of the proposal for such appointment/s are mentioned in the Explanatory Statement to the Notice.

Further, brief resume of the Directors proposed to be appointed/re-appointed, relevant information, nature of their expertise in specific functional areas, names of the companies in which they hold directorships and the memberships/chairmanships of committees of the Board and their shareholding in the company, as stipulated under clause 49 of the Listing Agreement entered into with the stock exchanges, have been furnished separately in the notice convening the 14th Annual General Meeting read with the annexure thereto forming part of the annual report.

Mr. Murugan M. Thevar, Managing Director; Mr. M. G. Subramaniam, Whole Time Director; Mr. Jayeek Nag, Chief Financial Officer (Upto August 31,2015) and Mr. Nishant Phadtare, Company Secretary are the KMPs of the Company as per the provisions of the Act.

7. DIRECTORS' RESPONSIBILITY STATEMENT:

As stipulated under section 134(3)(c) read with Section 134(5) of the Companies Act, 2013, your directors hereby state and confirm that :

i. In preparation of the Annual Accounts for the financial year ended March 31, 2015 the applicable accounting standards have been followed.

ii. The Directors had selected such Accounting Policies and applied them consistently and made

judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit or loss of the company for that period.

iii. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.

iv. The Directors had prepared the Annual Accounts on a going concern basis and

v. The Directors have devised a proper system to ensure compliance with the provisions of all applicable laws.

8. PARTICULARS OF EMPLOYEES:

In terms of the provisions of Section 197, read with Rule 5(1) and 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are set out in the "Annexure A" to the Directors Report.

9. DISCLOSURES REGARDING CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO:

Information required under Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014, with respect to conservation of energy, technology absorption and foreign exchange earnings/outgo is included in "Annexure B" to the Directors Report.

10. STATUTORY AUDITORS

M/s. Mukesh Mehta and Associates, Chartered Accountants, Mumbai and M/s. Suresh Hegde & Company, Chartered Accountants, Mumbai, retire at the ensuing Annual General Meeting and being eligible, offers themselves and have given consent for their reappointment as the joint statutory auditors of the Company subject to the approval of member's in the ensuing Annual General Meeting. The Board has recommended their appointment.

11. REMARKS IN STATUTORY AUDITORS REPORT:

The report of statutory auditors on the Profit and Loss Account for the year ended March 31, 2015 and Balance Sheet as on that date contains the following qualified remarks:

* In connection with the tax liabilities for the financial year 2012 -13 and financial year 2013-2014, the company has not booked the losses pertaining to the Rebates, Rate differences and discounts to the customers which they were entitled and also the advances given to the suppliers which were not recoverable nor received any goods or materials, the operation of the said company being suspended and the same was otherwise eligible for deduction u/s 37 (1) of the Income Tax Act, 1961. The company has not filed its income tax returns which were pending for filing for the aforesaid years i.e. assessment year 2013-14 and 2014-15 respectively. The company is in process for filing the same after the impact of above expenditure. The company has booked the rebates, rate difference and discounts to the tune of Rs. 7130.52 Lacs and written off advances to the tune of Rs. 2732.66 Lacs from the opening balances of profit and loss account / General Reserve as on April, 2014. The effect of both the adjustments is being routed in the current financial year from debtors and loans and advances and accumulated reserves respectively. The company's records indicate that had the Management stated the rebates, rate difference and discounts and written off advances the income tax, net profit and shareholder's funds would have been reduced to that extent.

* The company has received huge credits under export / import advances to the tune of Rs. 26,000/- lacs. The same will lead them for export obligations which as per the books of accounts are pending for long period and the same are outstanding as on 31st March, 2015.

* The company has executed long term contract with Directorate of Mines and Geology, Goa for purchase of iron ore and other related materials and incurred huge losses to the tune of Rs. 3,600/- lacs which affects the financial position of the company. The company's records indicate that the management has stated the inventories of iron ore at the lower of cost and net realizable value. Accordingly the valuation of inventories has decreased to Rs. 1,400/- lacs and the net profit / reserves and surplus has been reduced to that extent.

12. SECRETARIAL AUDITORS :

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors has appointed M/s. Reena S. Modi & Associates, Company Secretaries in whole time practice for conducting secretarial audit of the Company for the financial year 2014-2015. The Secretarial Audit Report is annexed herewith as "Annexure C."

13. REMARKS IN STATUTORY AUDITORS REPORT:

The report of M/s. Reena Modi & Associates, Company Secretaries, the secretarial auditor of the Company for the financial year 2014-15 contains the following remarks:

i The constitution of the Board of Directors of the Company is not as per the provisions of Clause 49 of the Listing Agreement read with Section 149 of the Companies Act, 2013.

With reference to the point (i) above, the Board of Directors of your Company states that the total strength of the Board during the year under review was 8 Directors which consist of 5 Executive Directors and 3 Non Executive Directors.

However, Mr. Deepak Shenoy, Executive Director has resigned from the Directorship of the Company with effect from March 31,2015. Further, in order to comply with the provision of the clause 49 of the Listing Agreement, the Company is in the process of appointing one more Non- Executive Director on the Board of the Company.

In order to comply with the provisions of the Section 149 of the Companies Act., 2013 and provisions of Listing Agreement, the Company has appointed Ms. Yogita Shetty as a Woman Independent Director on the Board of the Company

ii During the audit period under review, the Company was not able to engage Chief Financial Officer in pursuant to Section 203(1)(iii) of Companies Act, 2013.

With reference to the point (ii) above, the Board of Directors of your Company states that since the notification of section 203 of the Companies Act, 2013, the company was in the process of recruiting the person to hold the position of Chief Financial Officer of the Company. During the year under review the Company could not identify a suitable candidate for the said position.

However, the Company has appointed Mr. Jayeek Nag as a Joint Managing Director and Chief Financial Officer of the Company with effect from April 01,2015.

iii Applicable provisions of The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 not duly complied with.

iv Applicable provisions of The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992 not duly complied with.

With reference to the point (iv) above, the Board of Directors of your Company states that the Company has adequate system in place to comply with the provisions of The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992.

Whenever the meeting of the Board of Directors of the Company is proposed to be convened for consideration and approval of financial statements and all such other matters having effect on the price of the securities of the Company, a prior intimation is given to the respective Stock Exchanges relating to the same and the trading window is closed for trading in securities of the Company by the inside persons/officials. Also at the same time a notice is circulated amongst all the key managerial personnel and other employees intimating them about said closure of trading window.

v The Company has not been able to update applicable policies on its website as per the requirements of Listing Agreement.

With reference to the point (v) above, the Board of Directors of your Company states that the Company has framed various policies pursuant to the provisions of the Companies Act, 2013 and Listing Agreement e.g. Corporate Social Responsibility Policy (CSR Policy), Remuneration Policy for Directors etc. The Board further states that the Company is in the process of updating the said policies on the website of the Company.

vi The Company is under process to pay its dues w.r.t. listing fees to agencies such as BSE/ NSE/NSDL/CDSL/RTA.

With reference to the point (v) above, the Board of Directors of your Company states that the Company is regular in paying the dues/fees of BSE, NSE, NSDL, CDSL, RTA and such other entities. Due to adverse financial conditions suffered by the Company, there are few instances of delayed payments to these entities. However, the Company has paid Listing Fees to BSE and NSE for the financial year 2015-16. The Company has also cleared all the outstanding dues of NSDL, CDSL, and RTA. As on date there are no outstanding dues payable to these entities.

14. EXTRACT OF ANNUAL RETURN:

The extract of the Annual Return in Form MGT 9 as per the provisions of the Companies Act, 2013 is attached and marked "Annexure D"

15. CORPORATE GOVERNANCE:

Your Company is committed to good corporate governance, firmly believes in and consistently follows good corporate governance practices, leading to a very high level of transparency in accounting and reporting to its shareholders. The Company has adopted a code of Conduct for the Board and the Senior Management. A report on the Corporate Governance and a certificate from the Auditors of the Company forms part of the Annual Report. The Company has fully complied with the Corporate Governance practices specified under the Listing Agreement with Stock Exchanges.

16. DEPOSITS:

During the year under review, Company has not accepted any deposits from the Public within the meaning of the provisions of Section 73 of the Companies Act, 2013 read with the rules framed there under.

17. CORPORATE SOCIAL RESPONSIBILITY (CSR):

In compliance with the provisions of section 135 of the Companies Act, 2013, the Company has constituted a CSR Committee and the said CSR Committee has formulated a CSR policy recommending the activities which can be undertaken by the Company as a part of its CSR programme, amount which is to be spend on said CSR activities etc. and said CSR policy is also approved by the Board ofDirectors of the Company.

18. BOARD COMMITTEE:

In compliance with the provisions of the Companies Act, 2013 and both the mandatory and non-mandatory requirements under the Listing Agreements and the applicable laws, the board has constituted the following Committees:

i. Audit Committee

ii. Nomination and Remuneration Committee

iii. Stakeholder Relationship Committee

iv. Investment Committee

v. CSR committee

18. LISTING OF SHARES:

The shares of the Company are listed on the National Stock Exchange of India Limited and Bombay Stock Exchange Limited.

19. HOLDING / SUBSIDIARY COMPANY:

The Company has two subsidiaries as under:

i. Sudar Industries UK Ltd. - Registered in United Kingdom

ii. Averlin Industries PTE Limited, Registered in Singapore (Dormant Company)

20. VIGIL MECHANISM :

Your company has established a Vigil Mechanism and has framed Vigil Mechanism Policy. The purpose of the policy is to enable directors and employees to raise concerns about unacceptable improper practices and/or any unethical practices being carried out in the organization without the knowledge of the management. All directors and employees shall be protected from any adverse action for reporting any unacceptable/improper practice and/or any unethical practice, fraud or violation of any law, rule or regulation.

The audit Committee reviews on a quarterly basis, reports made under this policy and implements corrective actions, wherever necessary.

21. INDUSTRIAL RELATIONS:

Industrial Relations remained cordial in the Company's manufacturing locations at both the units without any disruption in manufacturing activities.

22. INTERNAL CONTROL AND ADEQUACY :

The Company has framed a proper system of internal controls to ensure that all the assets are safeguarded and protected against loss from unauthorized use or disposition and those transactions are properly authorized, recorded and reported correctly.

The Internal Control system is approved by the Audit Committee and is reviewed by Audit Committee from time to time.

23. RISKS AND CONCERNS:

The Company is exposed to various business risks which has adversely impacted operating performance of the Company. The Board has formulated Risk Management Policy to identify potential risks, create mitigation strategies, avoid risk, minimize the effect of risk and monitor the occurrence of risk. The risks to which Company is exposed may include but are not limited to:

* Economic conditions

* Supplier and distributor relationship

* Competitive market conditions

* Labour shortages and attrition of key staff

* Exchange rate fluctuation

* Compliance and regulatory pressures including changes to tax laws

* Seasonal fluctuation

24. OPPORTUNITIES AND THREATS:

We believe that there are tremendous growth opportunities in India as well as in emerging markets outside India. However, on the domestic front, there is still significant growth potential.

25. ACKNOWLEDGEMENTS:

The Board appreciates and places on record the contribution made by the employees during the year under review and the support received from the bankers, government authorities, customers, vendors during the year. The Board also places on record their appreciation of the support of all stakeholders particularly shareholders, customers, suppliers and business partners.

For and on behalf of the Board of Directors

Place: Navi Mumbai Murugan M. Thevar M. G. Subramaniam Date: August 14, 2015 Managing Director Executive Director




Mar 31, 2014

Dear members,

The Directors take pleasure in present the 13th Annual Report of the Company together with the Audited Statement of Accounts and the Auditors'' Report of your Company for the financial year ended, 31st March, 2014.

1) FOREWORD :

The Indian economy experienced a deceleration in economic growth during the period 2013-14. Your company had to face challenges in an inflationary market conditions coupled with a depreciating rupee leading to fall in profitability and increase in unemployment and therefore your company decided on a new focus to achieve all round growth by enhancing exports and value for the organization. In the process, many decisions taken by your company showed favorable trends and results.

THE COMPANIES ACT,2013

The Ministry of Corporate Affairs (MCA) has notified 282 sections of the Companies Act, 2013 (CA2013/Act) in tranches in September 2013 and March 2014 with majority of the sections as well as rules being notified in March 2014. The Companies Act, 1956 continues to be in force to the extent of the corresponding provisions of the CA2013 which are yet to be notified. MCA vide its Circular dated April 4, 2014 has clarified that the financial statements and documents annexed thereto, auditor''s report and board''s report in respect of financial year that have commenced earlier than April 1, 2014 shall be governed by the provisions of the Companies Act, 1956 and in line with the same, the financial statements, auditor''s report and Board''s report and attachments thereto have been prepared in accordance with the provisions of the Companies Act, 1956. With respect to other provisions of the Act, appropriate references have been made in this report to the extent these provisions have become applicable effective April 1, 2014.

2) HIGHLIGHTS OF PERFORMANCE:

* Your company achieved turnover of Rs. 92,730 lakhs as against Rs. 44,002 lakhs in the previous year i.e. an increase of— as compared to the previous year.

* Operating EBITDA increased in 2013-14 by Rs. 3,765 Lacs to Rs. 10,689 Lakhs from Rs. 6,924 Lakhs in 2012-13.

* Consolidated profit before tax in 2013-14 was Rs.6,538 Lakhs, against Rs.3,783 Lacs in 2012-13.Similarly, consolidated profit after tax was Rs.4,565 Lakhs in 2013-14 as against Rs.2,556 Lakhs in 2012-13.

The financial year 2013-2014 was a challenging year amidst global economic uncertainties and recession. Despite there being constraints and a challenging environment, the company performed reasonably well which is evident from the results.

3) FINANCIAL RESULTS :

This fiscal has been an exciting year in terms of growth and profitability. We are confident that this change and the proposal to engage in trading in Iron ore, Minerals etc. will enable the company to maintain our growth trajectory in the future. The fi nancial highlights for the financial year are given below:

(Rs. In Lakhs)

particulars FY 2013-14 FY 2012-13

Sales & Other Income 92,729.70 44002.27

Profit (Loss) before Interest tax

Depreciation and Exceptional Items 10,689.40 6,924.10

Less: Depreciation 1,300.90 1,158.93

Less: Interest Charges 2,850.86 1,979.21

Profit/(Loss) before exceptional and extraordinary itemsan taxation 6,537.64 3,785.96

Add/(Less) Exceptional items - 2.57

Profit(Loss) before Taxation 6,537.64 3,783.39

Less: Provision for Taxation -

Current tax 1,972.59 1,227.52

Profit (Loss) after Taxation 4,565.05 2,555.87

Balance of P&L A/c brought forward 5,320.45 2,764.58

Balance Carried to Balance Sheet 9,88.55 5,320.45

Earnings Per Share (Rs per share) 20.29 11.36

4) business OUTLOOK :

* Apparels :

Your Company, an integrated apparel manufacturer with its expertise in designing garments with its niche for finishing markets its products in wholesale market and multi-brand outlets. The Company''s international presence extends to United States of America, Italy, United Kingdom and the United Arab Emirates through merchandise exports. In order to expand its business activities, the Company has very recently commenced direct exports in Industrial Garments in the Financial Year 2013 to Gulf and South-East Asian Countries. The export sales in apparels segment of the Company for financial year 2013-14 was Rs. 7,095 lacs against Rs. 2299 lacs in financial year 2012-13.

B) HIGH ENDED FINE CHEMICALS PROVIDING INTERMEDIATE PRODUCTS FOR PHARMACEUTICAL AND AGRO CHEMICALS INDUSTRY :

Your Company has been successfully engaged in manufacturing chemical products in a wide range of activities which includes 6 Pharmaceutical Intermediates and 11 Agrochemical Intermediates. Your Company has already added good clients for the business relating to chemical products. The export sales in chemical segment of the Company for financial year 2013-14 was Rs. 5,391.32 lacs against Rs. 2020 lacs in financial year 2012-13.

C) PROPOSAL TO TRADE IN IRON ORE, MINERALS AND AGRO COMMODITIES:

The Company is proposing to diversify its activity to trading business of Iron ore, agro based commodities, other metals and minerals. The Company has obtained necessary approvals from the Shareholders of the Company through Postal ballot, and the expects good business deals in new markets.

5) DIVIDEND:

This year also your company would endeavor to strengthen the reserves for future expansion and therefore your Directors do not recommend any dividend for the year ended March 31, 2014.

6) ECONOMIC SCENARIO & OUTLOOK :

The global economy experienced a slowdown especially noticed in developed economies which had its impact on India as well. The Indian economy had to contend with high inflation in the year 2014 and increased lending rates. The tightening of the monetary policy further slowed the growth of the economy which affected all sectors.

7) SUSTAINABLE DEVELOPMENT :

The Company continues to provide sustainable waste management solutions through co-processing and re-engineering. Our clients have further increased with new waste streams efforts and continued to make the best use of fuels and raw materials thereby eliminating wastage.

8) CORPORATE SOCIAL RESPONSIBILITY COMMITTEE/CSR COMMITTEE:

During the year, your directors have constituted the Corporate Social Responsibility Committee comprising Mr. Satish Shenoy as the Chairman and Mr. Murugan M. Thevar, Mr. M.G. Subramaniam as other members.

The said committee has been entrusted with the responsibility of formulating and recommending to the board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, monitoring the implementation of the framework of the CSR Policy and recommending the amount to be spent on CSR Activities.

9) OCCUPATIONAL HEALTH AND SAFETY (OH&S);

Your Company engages in OH&S matters through a policy of communication, involvement and competency build-up applied consistently and continually throughout its operation. Programmes targeting critical areas are being implemented across all sites to address risks associated with operations. Effectiveness of these programmes is being constantly assessed by the Senior Leadership team. External audits are being conducted to check the level of implementation of these safety programmes.

Safety Leadership Programmes are being conducted across business units for the senior leadership team. The programmes comprises of practical exercises and interactive sessions and prepares managers to act as role model to their subordinates. Risk assessment is an integral part of any job/activity. Our managers are provided with different types of risk assessment tools to help them identify risk and decide on appropriate control measures. Hazard identification and risk assessment workshops are being conducted at sites to refine anticipation capability amongst the employees by enhancing their hazard observation skills.

Apart from our employees, our contractors are also involved in these workshops, which show an appreciable change in the attitude of contractors towards safety.

10) HUMAN RESOURCES :

Your company has embarked on a journey towards people excellence during the year. The aim of this journey is to re-engineer all the HR processes and ensure that each process is fine tuned with current and future business requirement and an appropriate number of employees are groomed for future middle and senior leadership roles. Greater focus is given to hiring and retaining talent from different disciplines and streams.

As extension of faster learning for young talent, your company has embarked on a plan to impart intensive learning through challenging functional/cross functional projects and coaching to improve analytical and decision making capability.

The industrial relations scenario was peaceful. Your company embarked on a major programme for the on roll and off roll employees with an emphasis on involving and engaging them in a variety of small improvement projects at the shop floor level so that their engagement level is enhanced.

11) directors

It has been the endeavor of your Company to place a lot of emphasis on its people which includes Employees, Directors and Customers. Your company believes that business being competitive in all spheres of activities, it is only competitive and competent people who can ensure that the Company marches in its road plan for attaining growth and prosperity.

Your Company is proud to have a professional board who have excellent experience with good credentials and support the business with their inputs and decisions which can strongly support your Company in its accomplishments of being one of the formidable companies in the industry.

In consonance with the provisions of the newly enacted Companies Act, 2013 and taking into consideration the composition of the Board of Directors, Mr. M.G. Subramaniam retires by rotation and being eligible offers himself for reappointment at the forthcoming Annual General Meeting.

The Companies Act, 2013 (the Act) provides for appointment of independent directors. Sub-section (10) of Section 149 of the Companies Act, 2013 (effective from April 1, 2014) provides that independent directors shall hold office for a term of up to five consecutive years on the Board of a company; and shall be eligible for re-appointment on passing of ordinary resolution by the shareholders of the company.

Sub-section (1) states that no independent director shall be eligible for more than two consecutive terms of five years. Sub - section (13) states that the provisions of retirement by rotation as defined in sub-sections (6) and (7) of Section 152 of the Act shall not apply to such independent directors.

The non-executive independent directors were appointed as directors liable to retire by rotation under the provisions of the erstwhile Companies Act, 1956. The Board of Directors has been advised that non executive (independent) directors so appointed would continue to serve the term that was ascertained at the time of appointment as per the resolution pursuant to which they were appointed. Therefore, it stands to reason that only those non-executive (independent) directors who will complete their present term at the ensuing AGM of the Company in September 2014, being eligible and seeking re - appointment, be considered by the shareholders for re-appointment for the first term of upto five consecutive years upto March 31, 2019.

Non-executive (independent) directors who do not complete their term at the ensuing AGM, will continue to hold office till the expiry of their term (based on retirement period calculation) and thereafter would be eligible for re-appointment for a fixed term in accordance with the Companies Act, 2013.

Based on the above, Mr. Anand Kadam and Mr. Satish Shenoy were appointed as Independent Directors of the Company for a term of two consecutive years effective from April 1, 2014 upto March 31, 2016.

12) DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to Section 217(2AA) of the Companies Act, 1956, the Board of Directors of the Company confirm that-

1. In preparation of the Annual Accounts for the financial year ended March 31, 2014, the applicable accounting standards have been followed.

2. The Directors had selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit or loss of the company for that period.

3. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.

4. The Directors had prepared the Annual Accounts on a going concern basis.

13) DISCLOSURES REGARDING CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO:

Information as per the Companies (Disclosure of Particulars on the report of the Board of Directors) Rules, 1988 relating to Conservation of Energy, Technology Absorption, Forex Earnings and Outgo is provided in the annexure forming part of this report.

14) INTERNAL CONTROL SYSTEMS :

The company has a robust and comprehensive internal control framework to ensure reliability of financial reporting, timely feedback on achievement of operational and strategic goals, compliance with policies, procedures, laws and regulations, and at the same time safeguarding assets and economical and efficient use of resources. The internal control system commensurate with the size, scale and complexity of its operations. It is being constantly assessed and strengthened with new/revised standard operating procedures and robust internal and information technology controls.

The company''s internal audit department objectively and independently tests the design and operating effectiveness of the internal control system to provide a credible assurance to the Board and the Audit Committee regarding the adequacy and effectiveness o the internal control system. The internal audit function monitors the effectiveness of controls and also provides an independent and objective assessment of the overall governance processes in the company.

The scope and authority of the Internal Audit activity are well defined. Internal Audit plays a key role by providing an assurance to the Board of Directors and value adding consultancy service to the business operations.

15) BUSSINESS RISK MANAGEMENT

Your company has robust business risk management practices to identify, evaluate business risks and opportunities. This is monitored at the Corporate office. The business risks and opportunities so identified are integrated into the business plan and a detailed action plan to mitigate the identified business risks is thereafter drawn up and its implementation monitored.

16) ENHANCING SHAREHOLDERS VALUE :

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

17) PARTICULARS OF EMPLOYEES:

In terms of the provisions of Section 217 (2A) of the Companies Act,1956, read with the Companies (Particulars of the Employees) Rules,1975 as amended, the names and other particulars of the employees are set out in the Annexure A to the Directors Report.

18) DEPOSITS:

During the year under review, Company has not accepted any deposits from the Public within the meaning of the provisions of Section 58A of the Companies Act, 1956 read with the Companies (Acceptance of Deposits) Rules, 1975.

19) AUDITORS

M/s. Suresh Hegde & Company, Chartered Accountants, Mumbai and M/s. Mukesh Mehta and Associates, Chartered Accountants Mumbai, have given consent for their reappointment as the joint statutory auditors of the Company subject to member''s approval in the ensuing Annual General Meeting.

20) CREDIT RATING

The Company continues to have the highest domestic credit ratings of BBB Negative from CARE which means strong rating reflecting the company''s financial discipline and prudence.

21) BOARD COMMITTEE:

In compliance with both the mandatory and non-mandatory requirements under the Listing Agreements and the applicable laws, the board has constituted the following Committees:

a) Audit Committee

b) Nomination and Remuneration Committee

c) Stakeholders Relationship Committee

d) Investment Committee

e) Corporate Social Responsibility Committee

The Company is committed to maintain the highest standards of corporate governance and strictly adhere to the Corporate Governance requirements set out by SEBI.

As per clause 49 of the Listing Agreement with the stock exchanges, a separate section on corporate governance practices, followed by the company together with a certificate from the company''s auditors confirming your Company is committed to good corporate governance and firmly believes in and consistently follows good corporate governance practices, leading to a very high level of transparency in accounting and reporting to its shareholders. The Company has adopted a code of Conduct for the Board and the Senior Management. A report on the Corporate Governance and a certificate from the Auditors of the Company forms part of the Annual Report. The Company has fully complied with the Corporate Governance practices specified under the Listing Agreement with Stock Exchanges.

23) MANAGEMENT''S DISCUSSION AND ANALYSIS:

A detailed review of operations, performance and future outlook of the Company is given separately under the head "Management''s Discussion and Analysis".

24) LISTING OF SHARES:

The shares of the Company are listed on the National Stock Exchange of India Limited and Bombay Stock Exchange Limited. The Company has paid the annual listing fees to the NSE and BSE for the year 2014-2015.

25) HOLDING / SUBSIDIARY COMPANY:

During the year, your company has incorporated three subsidiaries which can support the company in its trading operations in South East Asia, United Arab Emirates and London. It includes trading in Apparels and Fine Chemicals and its proposed business interest in trading in mineral and iron ore.

The Companies incorporated are as under :

* Sudar Industries UK Ltd. Registered in United Kingdom.

* Sudar Global Industries FZE, Registered in Dubai.

* Averlin Industries PTE Limited, Registered in Singapore.

26) AUDITORS :

In terms of the sub-section (2) of section 139 of the Companies Act, 2013 (effective from 01-04-2014) no Listed company shall appoint or re-appoint an Auditing Firm as the Auditor for more than two terms of five consecutive years, provided that the firm is eligible to be appointed or re-appointed in the same company after five years from the completion of existing term. In pursuance of the above, every listed company shall comply with this requirement within a transitional period of three years from the date of commencement of the Act i.e. 1st April, 2014.

The Company''s Joint Auditors M/s Suresh Hegde & Co. and M/s Mukesh Mehta & Associates, who retire at the ensuing Annual General Meeting of the Company, are eligible for re-appointment..

The Company has received letters from all of them to the effect that their re-appointment, if made, would be within the prescribed limits under Section 141 (3) of the Companies Act,2013 and that they are not disqualified for re-appointment.

27) INDUSTRIAL RELATIONS:

Industrial Relations remained cordial in the Company''s manufacturing locations without any disruption in manufacturing activities.

28) RATING FROM DUN & BRADSTREET

The Company has been rated 5A2 by Dun & Bradstreet indicating that the company has a tangible networth as per the audited financial statements and indicates a fair overall status of the company.

29) ACCOLADES :

Your Directors would like to inform that your company has been bestowed with the Gujarat Business Excellence Award by the Small and Medium Business Development Chamber of India in January, 2014. Your directors would like to inform that your company has featured in Businessworld magazine in August, 2014 India''s fastest growing companies.

30) ACKNOWLEDGEMENTS:

Your directors would like to express their appreciation for the assistance and co-operation received from bankers, govt. authorities, customers, vendors during the year. Your directors also wish to thank all employees, associates and business partners who have contributed towards the success of the Company.

31) CAUTIONARY STATEMENT :

Statements in the Directors'' Report and the Management Discussion and Analysis describing the company''s objectives, expectations or forecasts may be forward looking within the meaning of applications laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the company''s operations include global and domestic demand and supply conditions , changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

FOR AND ON BEHALF OF THE BOARD OF DIRECTORS

PLACE: NAVI MUMBAI MURUGAN M. THEVAR M.G. SUBRAMANIAM DATE: AUGUST 12,2014 MANAGING DIRECTOR WHOLE TIME DIRECTOR


Mar 31, 2010

The Directors are pleased to present the Ninth Annual Report of Company together with the Audited Statement of Accounts and the Auditors Report of your company for the financial year ended, 31st March, 2010. The summarized financial results for the year ended 31st March, 2010 are as under:

Financial Performance

This fiscal has been an exiting year in terms of growth and profitability. We are confident that this change will enable us to maintain our growth trajectory in to future. The financial highlights for the previous year as given below:

Particulars For the Financial Year For the Financial Year

ended 31st March, 2010 Ended 31st March 2009

(Rs. In Lacs) (Rs. In Lacs)

Sales & Other Income 5407.28 2089.94

Profit before interest, 913.77 292.35

depreciation and tax

Less: Depreciation 105.91 49.82

Less: Interest 163.59 152.44

Add/Less: Excess provision (0.52) 1.49

Net Profit/ (Loss) Before Tax 643775 9159

Less Provision for Tax 181.24 30.62

Less : Deferred Income Tax Fringe Benefit Tax 7.75 0.33

Profit/ (Loss) after Tax 424.76 60.64

Add : Profit/ (Loss) brought 101.98 41.34

forward

Balance Carried over to 526.74 101.98

Balance Sheet



Review of Operation

During the year under review, the Company achieved turnover of Rs.5286.64 Lacs in the as against Rs.2069.44 Lacs in previous year i.e. increase by 155.46% for the corresponding previous year. The Net Profit after Tax to the tune of Rs.424.76 lacs as against Net Profit to the tune of Rs. 60.64 lacs for the corresponding previous financial year i.e increase of 600.46% for the corresponding previous year.

Future Outlook

Your Directors are in process of expanding and diversifying the operations of the business. With regards to the same, Company needs financial resources for setting up the new advanced machineries and future plans for expansion and diversification. Thus, keeping in view the long term funds requirement of the company, the Directors propose to raise the fund through the issue of shares by the route of Initial Public Offering (IPO).

Dividend

In order to plough back the profit and strengthen the reserves, your Directors do not recommend any dividend for the year ended 31st March, 2010.

Bonus Issue of Shares

During the year under review. The Company has made a bonus issue of four equity share for every equity share held by the shareholders of the company and necessary resolution had been passed in extra ordinary general meeting of the company held on 15th March, 2010. Record date for the purpose of the bonus Issue was 15th March, 2010.

Directors

During the year, Mr. Deepak B. Shenoy was inducted as an additional director of the Company w.e.f. 20th January, 2010 under section 260 of the Companies Act, 1956 and subject to the Articles of Association of the Company will hold office upto the ensuing Annual General Meeting of the Company.

Company propose to appoint Mr. Murugan Muthaiah Thevar, Director of the Company as Chairman & Managing Director of the Company w.e.f 01st April, 2010 in the Shareholders meeting.

Directors Responsibility Statement

Pursuant to Section 217(2AA) of the Companies Act. 1956 the Board of Directors of the Company confirms that-

1. In preparation of the Annual Accounts for the financial year 2009-10, the applicable accounting standards have been followed.

2. The Directors had selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit or loss of the company for that period.

3. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.

4. The Directors had prepared the Annual Accounts on a going concern basis.

Disclosures under Section 217(1)(d) of the Companies Act, 1956

Except as disclosed elsewhere in this report, there have been no material changes and commitments which can affect the financial position of the Company occurred between the end of the financial year of the Company and date of this report.

Particulars of Employees

There is no employee in the Company whose particulars are required to be given under section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended.

Deposits

During the year under review, Company has not accepted any deposits from the Public within the meaning of the provisions of Section 58A of the Companies Act, 1956 read with the Companies (Acceptance of Deposits) Rules, 1975.

Name Change

Company has been issued fresh certificate of Incorporation consequent upon change of name upon conversion to Public Limited Company by the Registrar of Companies, Mumbai, Maharashtra. With effect from 18th February, 2010 the name of Company has been change from SUDAR GARMENTS PRIVATE LIMITED to SUDAR GARMENTS LIMITED.

Subsidiary Companies

The Company has no Subsidiary Company.

Auditors

M/s. Suresh Hegde & Company. Chartered Accountants has given consent for their reappointment as a statutory auditor of the Company subject to member approval in the Annual General Meeting.

Auditors Report

The obse vations of the auditors in their report are self-explanatory and therefore, in the opinion of the Directors, do not call for further comments.

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

The particulars as required under the provisions of Section 217(1)(e) of the Companies Act, 1956 in respect of conservation of energy and technology absorption apply to the Company and details of the same attached herewith.

Further during the year under review, the Company has neither earned nor used any foreign exchange.

Acknowledgements

The Director sincerely appreciates the contributions made by all the employees, associates and business partners who have contributed towards the success of the Company. The Directors place on record their gratitude for the continuing support of Shareholders, bankers and Business associates at all levels.

For and on behalf of the Board

(Murugan Muthaiah Thevar)

Chairman & Managing Director

Date: 16/04/2010

Place: Navi Mumbai

 
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