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Directors Report of Zenith Fibres Ltd.

Mar 31, 2016

DIRECTORS'' REPORT

Dear Members,

The Directors are pleased to present the 27th Annual Report together with Audited Financial Statements for the year ended March 31, 2016.

(Rs. in Lacs)

PARTICULARS

2015-16

2014-15

Revenue from Operations(net of Excise)

6383

6689

Profit Before Tax

1317

887

Profit After Tax

849

591

Add: Balance brought forward

456

1010

Total

1305

1601

Appropriations

- Transfer to General Reserve

500

1000

- Proposed Dividend

133

111

- Corporate Dividend Tax

27

23

- Adjustment for depreciation of earlier years

-

11

Profit & Loss Account Balance C/F

645

456


DIVIDEND

Enthused with the working of the Company, the Directors are pleased to recommend a higher dividend of Rs. 3/- on equity share of face value of Rs. 10/- each (30%) for the fiscal year ended 31st March, 2016 as against Rs. 2.50/- per Share (25%) for the previous financial year. The dividend, if approved by the Members in the ensuing Annual General Meeting, would absorb Rs. 159.67 Lacs including dividend distribution tax of Rs. 27 Lacs out of the distributable profits available. PERFORMANCE

The Company has achieved total revenue of Rs. 6680 Lacs as compared to last year''s revenue of Rs. 6921 Lacs. Profit before tax is Rs. 1317 Lacs and profit after tax stands at Rs. 849 Lacs during the year under review as against Rs. 887 Lacs and Rs. 591 Lacs respectively in the previous year.

PLANT OPERATIONS

Company''s Plant situated at Block 458, Village Post Tundav, Taluka Savli, Gujarat is running well and continues to operate satisfactorily.

SHARE CAPITAL

The paid up equity capital as on 31st March, 201 6 was Rs. 442.23 Lacs consisting of 44,22,346 Equity Shares of Rs. 10/- each. During the year under review, the Company has not issued any bonus shares, equity shares nor any right shares with differential voting rights etc., neither granted any stock options or sweat equity.

In pursuance of the Resolution passed by the members in the Annual General Meeting held on 29th Sep. 2015 and as per the Expert opinion of legal experts taken by the Company, 13,32,181 Equity Share not re-issued by the Company has been cancelled and as a result issued share capital of the Company stands reduced to 44,22,346 Equity Shares of Rs. 10/each from 57,54,527 Equity Shares of Rs. 10/- each and as per legal opinion, amount originally paid on forfeited shares Rs. 66,60,905/- transferred to Capital Reserve Account.

APPOINTMENT/REAPPOINTMENT/CESSATION OF DIRECTORS/ KMP

The following Directors/KMP are appointed/reappointed/ ceased during the year.

Name of Director/KMP

DIN/PAN

Appointment/

Reappointment/

Cessation

Shri Rajeev Rungta

00122221

Liable to retire by rotation

and reappointed in 26th AGM

Shri S.S. Iyer

AAKPI2184H

Designated as CEO on 8/8/2015

Shri K.D. Sharma

AJMPS8854P

Designated as CFO on 8/8/2015

Ms. Siddhi Shah

CZFPS9121 N

Appointed as Company Secretary on 01/01/2016

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Securities Exchange Board of India (Listing Obligations and Disclosures Requirements) Regulations, 2015, the Independent Directors have carried out an evaluation of Board as well as the evaluation of the working of its Audit, Nomination & Remuneration Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

COMPANY''S POLICY ON DIRECTORS'' APPOINTMENT AND REMUNERATION

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

FINANCE/ACCOUNTS

The Company continued to focus on improved cash generation without any compromise in the quality of its product. The focus on managing optimal levels of inventory, sound capacity utilization of each line in operation and cost saving/cutting across the organization helped generate healthy cash flow. The Company kept surplus funds prudently without any undue risk so as to ensure safety and liquidity of the funds.

The Company was able to raise the short-term/long term funds if and as and when required at reasonable rates and repaid strictly on due date as per terms.

CORPORATE GOVERNANCE

The Company is committed to maintain the highest standards of Corporate Governance and adhere to the corporate governance requirements set out by SEBI. The report on Corporate Governance as stipulated under Securities Exchange Board of India (Listing Obligations and Disclosures Requirements) Regulations, 2015 forms an integral part of this report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance is attached to the report on Corporate Governance.

CORPORATE SOCIAL RESPONSIBILITY

The Corporate Social Responsibility (CSR) Committee has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, which has been approved by the Board and hosted on the Company''s website. The Annual Report on CSR activities is annexed herewith marked as "Annexure A".

FIXED DEPOSITS

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

PARTICULARS OF LOANS, GUARANTEES, SECURITIES OR INVESTMENTS

The Company has not given any guarantees or securities covered under the provisions of Section 1 86 of the Companies Act, 2013 (''the Act''). However, the aggregate of loans and advances granted as also investments are within the limits of Section 186 of the Act. These have been disclosed in the Financial Statements.

A STATEMENT ON THE DECLARATION GIVEN BY INDEPENDENT DIRECTORS PURSUANT TO SECTION 149(6) OF THE ACT

The Company has received declaration from all Independent Directors of the Company to the effect that they meet the criteria of independence as stipulated u/s 149(6) of the Act.

DIRECTORS'' RESPONSIBILITY STATEMENT

In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that:

a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b) the directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 the year under review;

c) the directors have 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;

d) The directors had prepared the annual accounts on a going concern basis;

e) The directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively;

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

PARTICULARS OF CONTRACTS OR ARRANGMENTS WITH RELATED PARTIES REFERRED TO IN SECTION 188 OF THE COMPANIES ACT, 2013

There are no materially significant related party transactions made by the company with Promoters, Key Managerial Personnel or other designated persons during the year, which may have potential conflict with interest of the company at large.

AUDIT COMMITTEE RECOMMENDATIONS

During the year, the Board has accepted all recommendations of Audit Committee and accordingly no disclosure is required to be made in respect of non acceptance of the recommendation of the Audit Committee by the Board.

AUDITORS

a) Statutory Auditors:

The auditors, M/s. JAIN & HINDOCHA, Chartered Accountants, retire at the ensuing Annual General Meeting. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed there under for reappointment as Auditors of the Company.

The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review.

b) Internal Auditors:

The Board of Directors has appointed M/s Surendra Modiani & Associates as internal auditors of the Company for the F.Y. 2016-17

EXTRACT OF ANNUAL RETURN

The extract of the Annual Return in form MGT-9 is annexed herewith as "Annexure B".

EXPLANATION/COMMENTS ON QUALIFICATION/ RESERVATION/ADVERSE REMARK/DISCLAIMER BY THE AUDITORS, IF ANY

Since there was no qualification/reservation/adverse remark/ disclaimer either by the Auditors or Secretarial Auditors in their respective report, no explanation/comment is offered.

CODE OF CONDUCT

The Board of Directors have approved a Code of Conduct which is applicable to the Members of the Board and all Employees in the course of day to day business operations of the company. The code laid down by the Board is known as "Code of Business Conduct" which forms an Appendix to the Code.

The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the Designated Employees in their business dealings and in particular on matters relating to integrity in the work place in business practices and in dealing with stakeholders. All the Board Members and the Senior Management Personnel have confirmed compliance with the Code. All Key Managerial Personnel have been given appropriate briefing in this regard.

WHISTLE BLOWER POLICY/VIGIL MECHANISM

The Company has a Vigil Mechanism/Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. In staying true to our values of Strength, Performance and Passion and in line with our vision, the Company is committed to the high standards of Corporate Governance and stakeholder responsibility.

PREVENTION OF INSIDER TRADING

The Company has adopted a Code of Conduct for Prevention of Insider Trading pursuant to new SEBI (Prohibition & Insider Trading) Regulations, 2015 with a view to regulate trading in securities by the Directors and Designated Employees of the Company. The Code requires pre-clearance for dealing in the Company''s shares and prohibits the purchase or sale of Company shares by the Directors and the Designated Employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the ''Trading Window'' is closed. The Board is responsible for implementation of the Code. All Directors and the Designated Employees have confirmed compliance with the Code.

MEETINGS OF THE BOARD

Four meetings of the Board of Directors were held during the year. For further details, please refer report on Corporate Governance of this Annual Report.

SECRETARIAL AUDITOR

Pursuant to provisions of section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the Company has appointed Shri Upendra C. Shukla, Company Secretary in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report for the financial year ended 31st March, 2016 is annexed herewith marked as "Annexure C" to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

RISK MANAGEMENT POLICY

The Company has identified elements of any possible risk threatening the existence of the Company and formulated Risk Management Policy which is already operational.

DETAILS OF SIGNIFICANT & MATERIAL ORDERS IMPACTING THE GOING CONCERN STATUS/COMPANY''S OPERATIONS IN FUTURE

No significant/material orders have been passed by the regulators or courts or tribunals impacting the going concern status of the Company or company''s operations in future.

PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

As per the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 company has proper system to receive the complaint and constituted Internal Complaints Committees. During the year no complaint was received from any employee.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is as per "Annexure D" to this Report.

Information required under Section 197 read with rules 5 (2) (i) & 5(3)of Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 pertaining to the top ten employees in terms of remuneration drawn is annexed and forms part of this report. The said annexure is not being sent along with this report to the members of the Company in line with the provisions of Section 136 of the Companies Act, 2013. Members who are interested in obtaining these particulars, may write to the Company at the Registered Office. The aforesaid annexure is also available for inspection by the members at the Registered Office of the Company, 21 days before the 27th Annual General Meeting and up to the date of the said AGM during normal business hours on working days.

None of the employees was in receipt of a remuneration exceeding Rs.8, 50,000/- per month or Rs.1,02,00,000/- per annum.

MANAGEMEMNT DISCUSSION AND ANALYSIS

Management Discussion and Analysis Report for the year under review as stipulated under Regulations 34 and Schedule V of the SEBI (LODR) Regulations, 2015 is as under.

1. Industry Structure and Development

In the year 2015-16 the economic stability was conducive for Polypropylene Staple Fibre manufacturing. There is a steady improvement in the domestic geo-textile rates and in other domestic rates and exports. The demand pattern was encouraging.

2. Segment wise Operational Performance

The Company operates only into one segment, manufacturing of Manmade Fibres.

Performances in terms of profits are substantially higher than previous year, though production and sales in terms of volume and value differs marginally as under: -

(Quantity in MT)

2015-16

2014-15

Production

4823

4758

Sales

4725

4721

(Rs. in Lacs)

2015-16

2014-15

Net sales

6383

6689

Profit Before Tax

1317

887

Profit After Tax

849

591

Export was marginally lower at 1445MT (1550MT). Yarn processed outside on job work and sold (added in sales value above) was marginally higher at 1000MT (950MT)

3. Quality & Future Outlook

The general outlook for the Polypropylene Staple Fibre is encouraging.

Product quality of the company is far better than established norms and all efforts are made to improve further.

4. Threats and Concerns

The Company is committed to manufacture and deliver quality products strictly as per requirement of the customer and have the system to continuously get the feedback from customers and Endeavour to bring continuous improvement in process performance and product quality. The Company also meets international quality standards and product specifications as required by foreign buyers. All repeat orders are being placed by the customers in domestic as well as export markets. With established production base of almost 25 years the Company is in a position to maintain production and supply of quality products smoothly. The Company has benefit of lower cost of production, its long standing and can match the prices suitably as per pricing policy when required.

For the above reasons, no major threat is overseen and the Company is confident to face any threat in case of capacity expansion by other manufacturers. The Company is also maintaining liquidity to meet any unforeseen exigencies

5. Internal Control Systems and their adequacy

The Company has appropriate Internal Control Systems for business processes, financial reporting & controls, compliance with applicable laws, regulations etc.

The Company has appointed statutory auditors to evaluate Internal Control System.

Regular internal audits and checks ensure that system and procedures are continuously improved. The Audit Committee reviews the adequacy and effectiveness of Internal Control Systems and suggests ways of further strengthening them from time to time.

6. Human Resources and Industrial Relations

The Company has adequate and qualified human resources and enjoys cordial relations with its employees. Numbers of employees were 96 as on 31st March, 2016. The Board of Directors wishes to place on record appreciation for the contribution made by all the employees during the year.

7. Cautionary Statement

Statements in the Annual Report, particularly those which relate to Management Discussion and Analysis may constitute forward looking statements within the meaning of applicable laws and regulations. Although the expectations are based on the reasonable assumption, the actual results might differ.

INDUSTRIAL RELATIONS

Industrial relations at all levels have remained cordial throughout the year.

CONSERVATION OF ENERGY/TECHNOLOGY ABSORPTION AS WELL AS FOREIGN EXCHANGE EARNINGS AND OUTGO

The Company has not imported any foreign technology and hence, the company does not have any information to offer in respect of Technology Absorption. However, information in respect of Conservation of Energy & Foreign Exchange Earnings and outgo is as per "Annexure-E".

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY, IF ANY, DURING THE PERIOD FROM 31ST MARCH, 2016 TO THE DATE OF THE REPORT

There has been no material change/commitment affecting the financial position of the Company during the period from the end of the financial year on 31st March, 2016 to the date of the Report.

ACKNOWLEDGEMENTS

The Company would like to thank all the employees, Stakeholders, including inter alia Suppliers, Vendors, Investors and Bankers and appreciation to all its customers for their consistent unstinted support throughout the year.

On behalf of the Board of Directors

Date : 06/08/2016 RAJEEV RUNGTA MUKUND BERIWALA

Place : Mumbai Director Director

DIN: 00122221 DIN: 00053669


Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting the Twenty Sixth Annual Report together with Audited Financial Statements for the year ended March 31, 2015.

FINANCIAL RESULTS (Rs. in Lacs)

PARTICULARS 2014-15 2013-14

Gross Revenue from Operations 6921 5747

Profit before tax 887 516

Profit for the year 591 339

Add: Balance brought forward 1010 798

Total 1601 1137

Appropriations

Transfer to General Reserve 1000 50

Proposed Dividend 111 66

Corporate Dividend tax 23 11

Adjustment for depreciation of earlier years 11 -

Profit & Loss Account Balance C/F 456 1010

DIVIDEND

Enthused with the working of the Company, your Directors have pleasure to recommend a higher dividend of Rs.2.50/- on equity share of face value of Rs. 10/- each (25%) for the fiscal year ended 31st March, 2015 as against Rs.1.50 per Share (15%) for the previous financial year. The dividend, if approved by the Members in the ensuing Annual General Meeting, would absorb Rs.133.06 Lacs including dividend distribution tax of Rs. 23 Lacs out of the distributable profits available.

PERFORMANCE

The Company has achieved total revenue of Rs. 6921 Lacs as compared to last year's revenue of Rs.5747 Lacs. Profit before tax is Rs.887 Lacs and profit after tax stands at Rs. 591 Lacs during the year under review as against Rs. 516 Lacs and Rs. 339 Lacs respectively in the previous year.

PLANT OPERATIONS

Company's Plant situated at Block 458, Village Post Tundav, Taluka Savli, Gujarat is running well and continues to operate satisfactorily.

SHARE CAPITAL

The paid up equity capital as on March 31, 2015 was Rs. 442.23 Lacs consisting of 44,22,346 Equity Shares of Rs.10/- each. During the year under review, the Company has not issued any bonus shares, equity shares nor any Right Shares with differential voting rights etc., neither granted any stock options or sweat equity.

APPOINTMENT/REAPPOINTMENT/CESSATION OF DIRECTORS/ KMP

The following directors are appointed /reappointed /ceased during the year

Name of DIN/PAN Appointment/ Director/KMP Reappointment/ Cessation

Mr. Ajay Kumar Rungta 00053500 Reappointed in 25th who was liable to retire AGM by rotation

Ms. Shraddha Mookim 06948233 Appointed w.e.f 8th Nov, 2014

Mr. Ajay Kumar Rungta 00053500 Ceased due to death w.e.f. 24th Feb, 2015

It is indeed with a deep sense of sorrow we note the passing away of Mr. Ajay Kumar Rungta, founder Chairman of the Company and has thus ceased from the directorship of the Company w.e.f. February 24, 2015. The Board takes on record the invaluable guidance provided by the late Chairman since inception of the Company. His guiding principles and good governance in the Management of the Company will continue to be the guiding principles for future and he leaves behind a legacy that will be probably difficult to match. Nonetheless, the entire team of the Company shall endeavour to do its best.

BOARD EVALUATION

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

COMPANY'S POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION

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

FINANCE / ACCOUNTS

Your Company continued to focus on improved cash generation without any compromise in the quality of its product. The focus on managing optimal levels of inventory, sound capacity utilization of each line in operation and cost saving/cutting across the organisation helped generate healthy cash flow. Your Company kept surplus funds prudently without any undue risk so as to ensure safety and liquidity of the funds.

Your Company was able to raise the short-term/long-term funds, if and as and when required at reasonable rates and repaid strictly on due date as per terms.

CORPORATE GOVERNANCE

The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements set out by SEBI. The report on Corporate Governance as stipulated under the Listing Agreement forms an integral part of this Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance is attached to the report on Corporate Governance.

CORPORATE SOCIAL RESPONSIBILITY

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

The Annual Report on CSR activities is annexed herewith marked as "Annexure A".

FIXED DEPOSITS

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

PARTICULARS OF LOANS, GUARANTEES, SECURITIES OR INVESTMENTS

The company has not given any guarantees or securities covered under the provisions of Section 186 of the Companies Act, 2013 ("the Act"). However, the aggregate of loans and advances granted as also investments are within the limits of Section 186 of the Act.

A STATEMENT ON THE DECLARATION GIVEN BY INDEPENDENT DIRECTORS PURSUANT TO SECTION 149(6) OF THE ACT

The Company has received declaration from all Independent Directors of the Company to the effect that they meet the criteria of independence as stipulated u/s 149(6) of the Act.

DIRECTORS' RESPONSIBILITY STATEMENT

In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that:

a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b) the directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 the year under review;

c) the directors have 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;

d) the directors have prepared the annual accounts on a going concern basis; and

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

f) the directors have devised proper system to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively.

PARTICULARS OF CONTRACTS OR ARRANGMENTS WITH RELATED PARTIES REFERRED TO IN SECTION 188 OF THE COMPANIES ACT, 2013

There are no materially significant related party transactions made by the Company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the Company at large. The details are mentioned as per "Annexure B".

AUDIT COMMITTEE RECOMMENDATIONS

During the year, the Board has accepted all recommendations of Audit Committee and accordingly no disclosure is required to be made in respect of non acceptance of the recommendation of the Audit Committee by the Board.

AUDITORS

The auditors, M/s. JAIN & HINDOCHA, Chartered Accountants, retire at the ensuing Annual General Meeting. They have furnished their consent and requisite certificate pursuant to the Companies Act, 2013 in respect of their proposed appointment for the year 2015-16.

EXTRACT OF ANNUAL RETURN

The extract of the Annual Return in form MGT-9 is annexed herewith as "Annexure C".

EXPLANATION/ COMMENTS ON QUALIFICATION/ RESERVATION/ ADVERSE REMARK/ DISCLAIMER BY THE AUDITORS, IF ANY

Since there was no qualification/ reservation/ adverse remark/ disclaimer either by the Auditors or Secretarial Auditors in their respective report, no explanation/ comment is offered.

CODE OF CONDUCT

The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the company. The code laid down by the Board is known as "Code of Business Conduct" which forms an Appendix to the Code.

The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place in business practices and in dealing with stakeholders. All the Board Members and the Senior Management personnel have confirmed compliance with the Code. All Key Managerial Personnel have been given appropriate briefing in this regard.

WHISTLE BLOWER POLICY/ VIGIL MECHANISM

The Company has a Vigil Mechanism/Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. In staying true to our values of Strength, Performance and Passion and in line with our vision, the Company is committed to the high standards of Corporate Governance and stakeholder responsibility.

PREVENTION OF INSIDER TRADING

The Company has adopted a Code of Conduct for Prevention of Insider Trading pursuant to new SEBI (Prohibition & Insider Trading) Regulation 2015 in place of SEBI (Prohibition & Insider Trading) Regulation 1992 with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires pre-clearance for dealing in the Company's shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the 'Trading Window' is closed. The Board is responsible for implementation of the Code. All Directors and the designated employees have confirmed compliance with the Code.

MEETINGS OF THE BOARD

Four meetings of the Board of Directors were held during the year. For further details, please refer report on Corporate Governance of this Annual Report.

SECRETARIAL AUDITOR

Pursuant to provisions of section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the Company has appointed Mr. Upendra C. Shukla, Company Secretary in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report for the financial year ended March 31, 2015 is annexed herewith marked as "Annexure D" to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

RISK MANAGEMENT POLICY

The Company has identified elements of any possible risk threatening the existence of the Company and has put in place adequate measures to control it.

DETAILS OF SIGNIFICANT & MATERIAL ORDERS IMPACTING THE GOING CONCERN STATUS/ COMPANY'S OPERATIONS IN FUTURE

No significant/ material orders have been passed by the regulators or courts or tribunals impacting the going concern status of the Company or company's operations in future.

PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

As per the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 company has proper system to receive the complaint and constituted Internal Complaints Committees. During the year no complaint was received from any employee.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is as per "Annexure E" to this Report.

INDUSTRIAL RELATIONS

Industrial relations at all levels have remained cordial throughout the year in the Company.

CONSERVATION OF ENERGY/ TECHNOLOGY ABSORPTION AS WELL AS FOREIGN EXCHANGE EARNINGS AND OUTGO

The Company has not imported any foreign technology and hence, the Company does not have any information to offer in respect of Technology absorption. However, information in respect of Conservation of Energy & Foreign Exchange earnings and outgo are as per "Annexure- F".

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY, IF ANY, DURING THE PERIOD FROM 31ST MARCH, 2015 TO THE DATE OF THE REPORT

There has been no material change/ commitment affecting the financial position of the Company during the period from the end of the financial year on 31st March, 2015 to the date of the Report.

ACKNOWLEDGEMENTS

The Company would like to thank all the Stakeholders, including inter alia Suppliers, Vendors, Investors and Bankers and appreciation to all its customers for their consistent unstinted support throughout the year.

By Order of the Board of Directors

Place : Mumbai SANJEEV RUNGTA

Date : 08.08.2015 (DIN: 00053602)

CHAIRMAN


Mar 31, 2013

Dear Members,

The Directors are pleased to present the Twenty Fourth Annual Report on the working of the Company along with the audited statements of accounts for the financial year ended 31st March, 2013.

FINANCIAL HIGHLIGHTS

(Rs. in Lacs) (Rs. in Lacs) Current Previous Year Year

TURNOVER.......................... 5825,62 5349,94

OPERATING PROFIT............................ 621,17 541,72

CASH PROFIT............................ 726,96 635,98

PROFIT BEFORE TAX................. 621,17 541,72

PROFIT AFTER TAX.................. 444.84 354.12



MANAGEMENT DISCUSSION AND ANALYSIS

(a) Industry Structure and Development: Man-made fibre industry is well poised for reasonable growth despite slow down in European and certain other markets. Polypropylene fibre industry was not growing at the same rate as Polyester fibre because many sectors where PP should be used is replaced by Polyester .because of lower prices. Certain novel uses have been found in some sectors where use of PP fibre cannot be replaced and this augurs well for PP fibre industry and it should also show similar growth as other fibres.

(b) Segment-wise operational performance : Your Company operates into only one business segment - Manufacturing of Man Made Fibres.

Turnover for the year ended 31st March, 2013 amounted to Rs. 5825.62 lacs as against Rs. 5349.94 lacs last year. Operating profit stood at Rs. 621.17 lacs as againstRs. 541.72 lacs in the previous year. Cash profit was atRs. 726.96 lacs as against Rs. 635.98 lacs in the earlier year. Profit before tax stood atRs. 621.17 lacs as againstRs. 541.72 lacs in the earlier year and Profit after tax was at Rs. 444.84 lacs as against Rs. 354.12 lacs in the previous year.

Production during the year was higher at 4401 tons as against 4172 tons in the previous year. Sales of fibre including self consumption for conversion was 4328 tons as compared to 4224 tons last year. Sales of yarn was at 887 tons as compared to 1078 tons last year.

The year under review saw highest revenues, production and sales during a year since inception of the Company.

(c) Outlook : The general outlook for the industry is bright. Several sectors have been identified where use of PP fibre will be essential. Besides traditional need in various "infrastructure sector" its use has started in fabrics used for soil erosion and collection of ashes from power plants. To take advantage of expected increase in demand the company has augmented its capacity and commercial production was commenced during tne year.

(d) Threats and concerns : With considerable depreciation of Indian currency and European market being in bad shape there is not much of a threat from imports. However, in view of expected surge in demand competitors may also enlarge their capacity and market may need some time to stabilize and achieve correct balance between demand and supply. However, as an abundant precaution, based upon the size of operations of the Company the management is maintaining fairly decent amount of readily available liquidity to meet any unforeseen exigencies that may arise and in this spirit has also made certain nominal investment during the year under review, in the real estate sector in another state whereby yields are expected to be fairly good. Based upon the outcome of this investment, decision will be made in future whether to continue along this line or not.

(e) Internal control systems and their adequacy : Adequate internal control systems are in place to maintain quality of product, proper accounting as per norms laid, asset maintenance and its proper usRs.. All assets are adequately covered by comprehensive insurance. Independent Internal Auditor reviews accounts periodically and ''Audit Committee'' of the Board overviews the same and ensures compliance.

(f) Human Resources and Industrial Relations : The Company has adequate and qualified human resources and enjoys cordial relations with all its employees at all levels. Number of employees are 97 as on 31st March 2013. The Board of Directors wishes to place on record its highest appreciation for the contribution made by all the employees during the year.

DIVIDEND

Your Directors recommend for your approval a dividend of 20% for the financial year 2012-13. There will be no tax deduction at source on dividend payment and your Company will pay dividend distribution tax on this dividend along with surcharge thereon and education cess. The dividend received at shareholders end will be free of tax. The total outgo to the Company on this score shall be aboutRs. 1.03 Crores.

DIRECTORS

To comply with the requirement of the Companies Act, 1956 and Articles of Association of the Company, Shri Sanjeev Rungta and Shri Abhishake Rungta, retire from the Board by rotation and being eligible offer themselves for reappointment.

As required under Clause 49 of the Listing Agreement, the details concerning the Directors seeking appointment/ re-appointment are included in the Corporate Governance Report.

DIRECTORS'' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations provided to them, your Directors make the following statement, pursuant to Section 217(2AA) of the Companies Act, 1956 that:

1. in preparation of the annual accounts, the applicable accounting standards have been followed and there has been no material departure.

2. appropriate accounting policies have been selected and applied consistently, and judgments and estimates that are reasonable and prudent made so as to give a true and fair view of affairs of the Company as at March 31, 2013 and of the profit of the Company for the year ended on March 31, 20Rs. 3. ''

3. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

4. the annual accounts are prepared on a going concern basis.

CORPORATE GOVERNANCE

As per clause 49 of the Listing Agreement with the Stock Exchange, a separate section on Corporate Governance together with a certificate from the Company''s Auditors confirming compliance is set out in the Annexure forming part of this report.

ENERGY, TECHNOLOGY & FOREIGN EXCHANGE

Information pertaining to conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to section 217(1 )(e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 is annexed hereto and forms part of this report.

AUDITORS

Members are requested to appoint Auditors for the period from the conclusion of the ensuing Annual General Meeting till the conclusion of the next Annual General Meeting and to authorize the Board of Directors to fix their remuneration.

EMPLOYEES *

Since none of the employee was in receipt of a remuneration exceeding Rs. 5,00,000/- per month or Rs. 60,00,000/- per annum during the year under review, provisions of Section 217(2A) along with relevant rules do not apply to the Company.

SECRETARIAL COMPLIANCE CERTIFICATE

The Compliance Certificate issued by a Practicing Company Secretary is attached.

ACKNOWLEDGEMENT

Your Directors are thankful to all who contributed and assisted to achieve these results. They wish to place on record their appreciation for the support extended by the bankers, valuable customers, suppliers and the ''Share holders''.

For and on behalf of Board of Directors

SANJEEV RUNGTA

Place : Mumbai CHAIRMAN

Date : 25th May, 2013


Mar 31, 2012

The Directors are pleased to present the Twenty Third Annual Report on the working of the Company along with the audited statements of accounts for the financial year ended 31st March, 2012.

FINANCIAL HIGHLIGHTS (Rs. in Lacs)

Current Previous Year Year

TURNOVER 5349.94 4177.55

OPERATING PROFIT 654.09 481.87

CASH PROFIT 638.58 467.33

PROFIT BEFORE TAX 544.32 372.55

PROFIT AFTER TAX 354.12 247.81

MANAGEMENT DISCUSSION AND ANALYSIS

(a) Industry Structure and Development : Man-made fibre industry is well poised for reasonable growth despite slow down in European and certain other markets. Polypropylene fibre industry was not growing at the same rate as Polyester fibre because many sectors where PP should be used is replaced by Polyester because of lower prices. Certain novel uses have been found in some sectors where use of PP fibre cannot be replaced and this augurs well for PP fibre industry and it should also show similar growth as other fibres.

(b) Segment-wise operational performance : Your Company operates into only one business segment - Manufacturing of Man Made Fibres.

Turnover for the year ended 31st March, 2012 amounted to Rs. 5349.94 lacs as against Rs. 4177.55 lacs last year. Operating profit stood at Rs. 654.09 lacs as against Rs. 481.87 lacs in the previous year. Cash profit was at Rs. 638.58 lacs as against Rs. 467.33 lacs in the earlier year. Profit before tax stood at Rs. 544.32 lacs as against Rs. 372.55 lacs in the earlier year and Profit after tax was at Rs. 354.12 lacs as against X 247.81 lacs in the previous year.

Production during the year was higher at 4172 tons as against 3830 tons in the previous year. Sales of fibre including self consumption for conversion was 4223 tons as compared to 3809 tons last year. Sales of yarn was at 1078 tons as compared to 636 tons last year.

The year under review saw highest revenues, production and sales during a year sin.ce inception of the Company.

(c) Outlook : The general outlook for the industry is bright. Several sectors have been identified where use of PP fibre will be essential. Besides traditional need in various "infrastructure sector" its use has started in fabrics used for soil erosion and collection of ashes from power plants. To take advantage of expected increase in demand the company has augmented its capacity and commercial production should commence from June 2012.

(d) Threats and concerns : With considerable depreciation of Indian currency and European market being in bed shape there is not much of a threat from imports. However, in view of expected surge in demand competitors may also enlarge their capacity and market may need some time to stabilize and achieve correct balance between demand and supply.

(e) Internal control systems and their adequacy : Adequate internal control systems are in place to maintain quality of product, proper accounting as per norms laid, asset maintenance and its proper use. All assets are adequately covered by comprehensive insurance. Independent Internal Auditor reviews accounts periodically and 'Audit Committee' of the Board overviews the same and ensures compliance.

(f) Human Resources and Industrial Relations : The Company has adequate and qualified human resources and enjoys cordial relations with all its employees at all levels. Number of employees are 97 as on 31st March 2012. The Board of Directors wishes to place on record its highest appreciation for the contribution made by all the employees during the year.

DIVIDEND

Encouraged by the improved performance, your Directors recommend for your approval a dividend of 20% for the financial year 2011-12. There will be no tax deduction at source on dividend payment and your Company will pay dividend distribution tax on this dividend along with surcharge thereon and education cess. The dividend received at shareholders end will be free of tax. The total outgo to the Company on this score shall be about Rs. 1.03 Crores.

DIRECTORS

Mr. C.I. Gandhi resigned as Director on 13th June, 2011 as Director of the Company. Mr. C.I. Gandhi was associated with your Company since its inception. The Board of Directors places on record its deep sense of appreciation for the valued services rendered by Mr. Gandhi.

The Board of Directors in its meeting held on 28th May, 2012 has appointed Dr. S.R. Vengsarker as Additional Director. In pursuance of Section 260 of the Companies Act, 1956 Dr. S.R. Vengsarker will cease to be the Director at the ensuing Annual General Meeting. The Company has received a notice from one of the members along with refundable deposit under Section 257 of the Companies Act, 1956 signifying his intention of proposing the appointment of Dr. S.R. Vengsarker.

Dr. S.R. Vengsarker did his M. Text from V.J.T. Institute, Mumbai. He also obtained Ph.D. from Leeds University, Leeds, U.K. He has almost 50 years experience in the textile industry of which the major part he has been associated with the Synthetic Fibre Industry. Detailed profile of Dr. Vengsarker is given in Corporate Governance Repot under clause 49 of the Listing Agreement. Your directors are of the opinion that the co-option of Dr. Vengsarker on the Board as Director is in the best interest of the Company.

To comply with the requirement of the Companies Act, 1956 and Articles of Association of the Company, Shri A.K. Rungta and Shri Rajeev Rungta, retire from the Board by rotation and being eligible offer themselves for re-appointment.

As required under Clause 49 of the Listing Agreement, the details concerning the Directors seeking appointment/re- appointment are included in the Corporate Governance Report.

DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations provided to them, your Directors make the following statement, pursuant to Section 217(2AA) of the Companies Act, 1956 that :

1. in preparation of the annual accounts, the applicable accounting standards have been followed and there has been no material departure.

2. appropriate accounting policies have been selected and applied consistently, and judgments and estimates that are reasonable and prudent made so as to give a true and fair view of affairs of the Company as at March 31, 2012 and of the profit of the Company for the year ended on March 31, 2012.

3. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

4. the annual accounts are prepared on a going concern basis.

CORPORATE GOVERNANCE

As per clause 49 of the Listing Agreement with the Stock Exchange, a separate section on Corporate Governance together with a certificate from the Company's Auditors confirming compliance is set out in the Annexure forming part of this report.

AUDITORS' QUALIFICATION

Imbalance occurred during the year due to resignation of Sri C.I.Gandhi which is being filled now.

ENERGY,TECHNOLOGY & FOREIGN EXCHANGE

Information pertaining to conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 is annexed hereto and forms part of this report.

AUDITORS

Members are requested to appoint Auditors for the period from the conclusion of the ensuing Annual General Meeting till the conclusion of the next Annual General Meeting and to authorize the Board of Directors to fix their remuneration.

EMPLOYEES

Since none of the employee was in receipt of a remuneration exceeding Rs. 5,00,000/- per month or Rs. 60,00,000/- per annum during the year under review, provisions of Section 217(2A) along with relevant rules do not apply to the Company.

SECRETARIAL COMPLIANCE CERTIFICATE

The Compliance Certificate issued by a Practicing Company Secretary is attached.

ACKNOWLEDGEMENT

Your Directors are thankful to all who contributed and assisted to achieve these results. They wish to place on record their appreciation for the support extended by the bankers, valuable customers, suppliers and the 'Share holders'.

For and on behalf of Board of Directors

Place : Mumbai SANJEEV RUNGTA

Date : 28th May, 2012 CHAIRMAN


Mar 31, 2010

The Directors are pleased to present the Twenty first Annual Report on the working of the Company along with the audited statement of accounts for the financial year ended 31st March, 2010.

FINANCIAL HIGHLIGHTS (Rupees in Lacs)

Current Previous

Year Year

TURNOVER 3581.49 3689.30

OPERATING PROFIT 501.30 534.11

CASH PROFIT 485.50 519.26

PROFIT BEFORE TAX 390.34 428.28

PROFIT AFTER TAX 286.37 269.75

MANAGEMENT DISCUSSION AND ANALYSIS

(a) Industry Structure and Development : Despite severe global economic turbulence in all major sectors of the economy, Man-made Fibre Industry maintained consumption pattern and Polypropylene Fibre, the youngest and smallest part of this industry in our country followed the same trend. However, there is a wide gap in per capita consumption of PP Fibre as compared to developed countries. The major areas of consumption of PP Fibre in the world market viz. Geo-Textiles and for hygiene applications is yet to show substantial opening. Currently in India the application in both these sectors is bare minimal but once the consumption picks up it can lead to phenomenal growth and development of PP Fibre Industry and the Company.

(b) Segment-wise operational performance : Your Company operates into only one business segment - Manufacturing of Man Made Fibres.

Turnover for the year ended 31st March, 2010 amounted to Rs. 3581.49 lacs as against Rs. 3689.30 lacs last year. Operating profit stood at Rs. 501.30 lacs as against Rs. 534.11 lacs in the previous year. Cash profit was at Rs. 485.50 lacs as against Rs. 519.26 lacs in the earlier year. Profit before tax stood at Rs. 390.34 lacs as against Rs. 428.28 lacs in the earlier year and Profit after tax was higher at Rs. 286.37 lacs as against Rs. 269.75 lacs in the previous year.

Production during the year was at 3398 tons being marginally lower than in the previous year at 3502 tons. Sales of fibre including self consumption for conversion was 3471 tons as compared to 3406 tons last year. Sales of yarn was higher at 798 tons as compared to 731 tons last year. From the resources available after taxes and from balance available from earlier years Rs. 10 Cores have been transferred to General Reserve.

(c) Outlook : The general outlook for the industry was fairly steady. The domestic market continued to maintain steady consumption. With speciai emphasis on Infrastructure sector it can further augur weli for the Company. Use of geo-textile in construction of new roads, rails, which is a standard norm in developed countries can lead to a phenomenal rise in demand of your Companys products.

(d) Threats and concerns : Your Company continues to maintain constant guard from possible imports and to ward off this threat the pricing of the finished goods is done accordingly so as to match the international prices. The non utilization of geo-textiles as a standard in large projects by the Government is of concern to the Company, whereby the requirement of PP Fibre should be highest as per international standards. The Company continues to maintain close vigil on supplies in the domestic market from the new players and is constantly taking necessary measures to ward off any un-warranted threat from the recent entrants. Overall global economic environment is of concern to the management.

(e) Internal control systems and their adequacy : Adequate internal control systems are in place to maintain quality of product, proper accounting as per norms laid, asset maintenance and its proper use. All assets are adequately covered by comprehensive insurance. Independent Internal Auditor reviews accounts periodically and Audit Committee of the Board overviews same and ensures compliance.

(f) Human Resources and Industrial Relations : The Company has adequate and qualified human resources and enjoys cordial relations with all its employees at all levels. Number of employees are 96 as on 31st March 2010. The Board of Directors wish to place on record its highest appreciation for the contribution made by all the employees during the year.

DIVIDEND

Your Directors recommend for your approval a dividend of 15% for the financial year 2009-10. There will be no tax deduction at source on dividend payment and your Company will pay dividend distribution tax on this dividend along with surcharge thereon and education cess. The dividend received at shareholders end will be free of tax. The total outgo to the Company on this score shall be about Rs. 78 lacs.

DIRECTORS

To comply with the requirement of the Companies Act, 1956 and Articles of Association of the Company, Shri Sanjeev Rungta and Shri Abhishake Rungta, retire from the Board by rotation and being eligible offer themselves for reappointment.

As required under Clause 49 of the Listing Agreement, the details concerning the Directors seeking appointment/re-appointment are included in the Corporate Governance Report.

DIRECTORS RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations provided to them, your Directors make the following statement, pursuant to Section 217(2AA) of the Companies Act, 1956 that :

1. in preparation of the annual accounts, the applicable accounting standards have been followed and there has been no material departure.

2. appropriate accounting policies have been selected and applied consistently, and judgments and estimates that are reasonable and prudent made so as to give a true and fair view of affairs of the Company as at March 31, 2010 and of the profit of the Company for the year ended on March 31, 2010.

3. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

4. the annual accounts having been prepared on a going concern basis.

CORPORATE GOVERNANCE

As per clause 49 of the Listing Agreement with the Stock Exchange, a separate section on Corporate Governance together with a certificate from the Companys Auditors confirming compliance is set out in the Annexure forming part of this report.

ENERGY, TECHNOLOGY & FOREIGN EXCHANGE

Information pertaining to conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 is annexed hereto and forms part of this report.

AUDITORS

Members are requested to appoint Auditors for the period from the conclusion of the ensuing Annual General Meeting till the conclusion of the next Annual General Meeting and to authorize the Board of Directors to fix their remuneration.

EMPLOYEES

Since none of the employee was in receipt of a remuneration exceeding Rs. 2,00,000/- per month or Rs. 24,00,000/- per annum during the year under review, provisions of Section 217(2A) along with relevant rules do not apply to the Company.

ACKNOWLEDGEMENT

Your Directors are thankful to all who contributed and assisted to achieve these results. They wish to place on record their appreciation for the support extended by the bankers, valuable customers, suppliers and the Share holders.

For and on behalf of Board of Directors

Place : Mumbai SANJEEV RUNGTA

Date : 26th July, 2010 CHAIRMAN

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