Directors Report of Kothari Fermentation & Biochem Ltd.

Mar 31, 2018

TO THE MEMBERS OF

The directors are pleased to present the 28th Annual Report together with the Audited Accounts for the year ended on 31st March 2018:

1. FINANCIAL RESULTS (Rs. In lacs)

	2017-2018	2016-2017
Turnover	8769.39	7909.16
Profit before Finance Charges & Depreciation	1196.59	900.11
Finance Charges	165.59	152.98
Depreciation	312.69	259.43
Profit before Tax	718.31	487.70
Taxes:
Current Tax	148.66	98.31
Deferred Tax	36.22	67.98
Net Profit/(Loss) after Tax	533.43	321.41

2. BUSINESS OPERATIONS

During the year under review, your company achieved production of 16653 MT as compared to 14968 MT in previous year. The turnover of the company has increased to Rs. 8769.39 Lakhs during the year 2017-18 as compared to Rs. 7909.16 Lakhs during previous year recording a growth of 10.88%. The profitability of the company is Rs. 533.43 Lakhs during the year 2017-18 as compared to profit of Rs. 321.41 Lakhs during the previous year.

The operational performance during the year and the future outlook of the Company has been comprehensively covered in the Management Discussion and Analysis Report which is provided as a separate section in the Annual Report.

3. DIVIDEND

Dividend for the year has not been proposed in order to plough back profits for the growth of the Company.

4. DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board of Directors of your Company at its meeting held on 30th March, 2018 on the recommendation of Nomination and Remuneration Committee approved re-apointment of Mr. Pramod Kumar Kothari as Chairman and Managing Director and Mrs. Kavita Devi Kothari as Whole time Director of the Company w.e.f. 1st April, 2018.

During the year under review term of all directors who are liable to retire by rotation is expiring and is placed before shareholder for their approval, thus during the period under review no director is liable to retire by rotation at the ensuing AGM pursuant to provisions od section 152 of the Companies Act, 2018 read with the Companies (Appointment and Qualification of Directors) Rules, 2014. The information on the particulars of Directors eligible for appointment and re-appointment in terms of regulation 36 of SEBI (LODR) Regulations 2015 and Secretarial Standard -2 issued by ICSI has been provided in the notes to the notice convening the Annual General Meeting. Your Directors recommend their re-appointment on the terms and conditions as set out in the notice convening forthcoming AGM.

The Independent Directors have submitted their declaration that they fulfill the requirements as stipulated in Section 149(6) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, as applicable.

5. DIRECTORS’ RESPONSIBILITY STATEMENT

Based on the framework of internal financial controls and compliance systems established and maintained by the company, work performed by the internal, statutory and secretarial auditors and the reviews performed by the Board and its committees, the Board is of the opinion that the company’s internal financial controls were adequate and effective during the financial year 2017-18. Pursuant to Sec.134 (5) of the Companies Act, 2013 the directors to the best of their knowledge and ability hereby report:

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

ii. that the directors have selected 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 2017-18 and of the profit of the company for the year;

iii. that the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv. that the directors have prepared the annual accounts on a going concern basis;

v. that 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;

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

6. CREDIT RATING

Your company’s domestic credit rating is ‘BBB-’ for long term debt facilities and an ‘A3’ for the short term debt facilities assigned by SMERA Ratings Limited

7. CERTIFICATIONS

Your company has been certified as ISO 9001:2015 on 09.07.2018 or its quality management systems employed at every level of the organization.

8. AUDITORS AND AUDITOR’S REPORT

A) Statutory Auditors

In terms of the provisions of the section 139 of the Companies Act, 2013, the shareholders have appointed M/s Kothari Kuldeep and Co., Chartered Accountants as Statutory Auditor of the Company for a term of five year from the conclusion of 27th Annual General Meeting till the conclusion of 32nd Annual General Meeting of the Company to be held in the year 2022. Ratification of their appointment from Shareholders at ensuing AGM is not required.

The notes on accounts are self-explanatory with regards to auditors’ observations. There were no qualifications, reservations or adverse remarks made by the Auditors for the year under review.

B) Secretarial Auditors

The Board had appointed M/s V.K. Sharma & Company, Practising Company Secretaries, as Secretarial Auditor to conduct the secretarial audit of the company for the financial year 2017-18, pursuant to the provisions of Section 204 of the Companies Act, 2013. The Report of the Secretarial Auditor forms part of the Board’s Report as Annexure ‘A’.

In respect of observations made by the Secretarial Auditors in their Report, it is mentioned that:

1. The company had applied in BSE for listing of 89.05 Lakhs equity shares issued preferentially to the promoter/ promoter group in the year 2008-09 & 2009-2010. The Company had applied for listing within stipulated time and furnished all requisite documents for the listing of the same to the BSE. Regular follow up has been done with BSE, but certain queries were raised by the exchange in the year 2012. The Company has duly provided with the exchange all required clarifications and replies and has even paid the additional listing fees, as demanded by BSE. The matter is pending with BSE for its necessary approval. During the year BSE approved the listing of 59,05,000 shares out of 89,05,000 shares. Listing of remaining 30,00,000 shares is under process with BSE.

2. The Company has appealed against the order of Income Tax Department before the Commissioner of Income tax Appeals, New Delhi within prescribed time limit. However, the Company received the stay order against the demand raised by income tax department from the Hon’ble High Court. The Company’s management including its tax advisors believes that its position will likely be upheld in the appellate process whereby it is expected that the matter will be decided in favour of the Company and the demand raised will be dropped by the Appellate Authorities.

The Board at its meeting held on 23.05.2018 reappointed M/s V.K. Sharma & Company, Practising Company Secretaries as Secretarial Auditor for FY 2018-19.

9. CORPORATE GOVERNANCE

The Company is complying with SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, as applicable with regard to Corporate Governance and reports to that effect are being regularly filed with the Stock Exchanges. A report on Corporate Governance practices and the Certificate from the Auditors on compliance of the mandatory requirements thereof are made a part of the Annual report.

10. VIGIL MECHANISM

A comprehensive Vigil mechanism/Whistle Blower Policy has already been adopted by the Company which provides adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of employees. The policy as approved by the Board is uploaded on the Company’s website at http://www.kothariyeast.in/financial/policies/whistle blower policy.pdf.

11. RISK MANAGEMENT POLICY OF THE COMPANY

Your company has adopted a Risk management policy to identify and categorize various risks, implement measures to minimize impact of these risks where it is deemed necessary and possible, and a process to monitor them on a regular basis.

12. REMUNERATION POLICY AND BOARD EVALUATION

The Board has adopted a Remuneration Policy as recommended by the Nomination & Remuneration Committee. It provides for the criteria for determining Qualifications, Positive Attributes & Independence of the Directors, defining the criteria of the remuneration of the KMP’s and Senior managerial personnel along with their roles and responsibilities. The aim is to ensure that the company attracts and retains competent people.

The Board has carried out an Annual Performance Evaluation of its own performance and the Directors individually. The Disclosures relating to the same are provided in the Corporate Governance Report.

13. DISCLOSURES

a) Number of Board & Committee Meetings:

During the year under review, Six Board meetings, Five Audit Committee meetings, Four Stakeholders Relationship Committee meetings and Three Nomination & Remuneration Committee meeting were convened and held. Details and attendance of such Board & Committees meetings are mentioned in Corporate Governance Report.

Pursuant to clause VII (1) of Schedule IV of the Companies Act, 2013, the Independent Directors had a separate meeting on 14.02.2018.

b) Deposits - The Company has not accepted any deposit from public during the year under review.

c) Share Capital - There was no change in the Company’s share capital during the year under review.

d) Audit Committee - The Company has duly constituted an Audit Committee, whose detailed composition and powers are provided in the Corporate Governance Report. There were no recommendations of the Audit Committee which have not been accepted by the Board during the financial year.

e) Extract of Annual Return - The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in Annexure ‘B’ and is attached to this Report.

f) Disclosure pertaining to Managerial Remuneration - Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided as per Annexure ‘C’.

The information required pursuant to section 197 read with rule 5(2) & (3) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees will be provided upon request.

g) Related Party Transactions - There were no materially significant transactions with the related parties during the financial year that may have potential conflict with interest of the Company at large. Disclosures relating to the same are provided separately in the Corporate Governance Report.

h) Particulars of Loans, Guarantees or Investments under Section 186 - Details of Loans, Guarantees or Investments under Section 186 of the Companies Act, 2013 are given in the accompanying Financial Statements.

i) Cost Account and Records- Maintenance of cost records as specified by the central government under sub section (1) of section 148 of the Companies Act, 2013, is not required by the Company and accordingly such accounts and records are not prepared. However, the cost records for internal control and Strategic Management purposes are prepared by the Company.

j) Prevention of Sexual Harassment - The Company has complied with provisions relating to the constitution of internal complaints committee under the Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal ) Act, 2013. k) Significant and Material Orders Passed by the Regulators or Courts - No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company’s operation in future.

14. CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The information pertaining to conservation of energy, technology absorption, Foreign exchange Earnings and outgo as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished in Annexure ‘D’ and is attached to this report.

ACKNOWLEDGEMENTS

Your Board of Directors is thankful to all the Shareholders for their constant faith reposed in the company. They also placed on record their sincere appreciation for the wholehearted devotion and co-operation extended by the employees at all levels, which has been a source of strength to the company.

The Directors also wish to thank and deeply acknowledge the continued support, guidance and co-operation of the Customers, Auditors, Legal Advisers, consultants, Bankers (Punjab National Bank as the main Banker), Dealers, Vendors and other stakeholders of the Company.

For and on behalf of the Board

Place: New Delhi Pramod Kumar Kothari

Date: 14.08.2018 Chairman & Managing Director

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Mar 31, 2016

DIRECTORS’ REPORT

TO THE MEMBERS OF

The directors are pleased to present the 26^th Annual Report together with the Audited Accounts for the year ended on 31^st March 2016:

1. FINANCIAL RESULT (Rs. In lacs)

	2015-2016	2014-2015
Turnover	7718.13	6433.08
Profit before Finance Charges & Depreciation	626.98	467.87
Finance Charges	144.92	155.30
Depreciation	197.30	172.65
Profit before Tax	284.76	139.93
Taxes:
Current Tax	58.50	28.25
Less: MAT Credit Entitlement	(42.41)	(28.25)
Deferred Tax	79.79	53.93
Net Profit/ (Loss) after Tax	188.87	86.00

2. BUSINESS OPERATIONS

During the year under review, your company achieved production of 15230 MT during 2015-16 as compared to 14026 MT in previous year. Resultantly the turnover of the company from manufacturing activities has increased to Rs. 7718.13 Lakhs during the year 2015-16 as compared to Rs. 6433.08 Lakhs during previous year recording a growth of 19.98%. The profitability of the company is Rs. 188.87 Lakhs during the year 2015-16 as compared to profit of Rs. 86.00 Lakhs during the previous year recording a growth of 119.63% in the profits after tax.

The operational performance during the year and the future outlook of the Company has been comprehensively covered in the Management Discussion and Analysis Report which is provided as a separate section in the Annual], Report.

3. DIVIDEND

Dividend for the year has not been proposed in order to plough back profits for the growth of the Company.

4. DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with the provisions of the Companies Act, 2013 and pursuant to Section 152(6), the directors excluding the Independent Directors, being Executive Directors, are now made liable to retire by rotation at every Annual General Meeting. Thus, Mr. Pramod Kumar Kothari (DIN: 00086145) Chairman & Managing Director of the Company retire by rotation and being eligible, offers himself for reappointment. Though, such determination of office by retirement and then re-appointment would not constitute a break in his tenure of service as the Chairman & Managing Director of the Company.

Brief resume of Mr. Pramod Kumar Kothari, nature of his expertise in specific functional areas and the name of the public companies in which he holds the Directorship, as stipulated under the Listing Agreement/ SEBI (LODR) Regulations, is given in the notice convening the Annual General Meeting. The Board recommends his appointment as such.

The Independent Directors have submitted their declaration that they fulfill the requirements as stipulated in Section 149(6) of the Companies Act, 2013 and Listing Agreement/SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, as applicable.

5. DIRECTORS’ RESPONSIBILITY STATEMENT

Based on the framework of internal financial controls and compliance systems established and maintained by the company, work performed by the internal, statutory and secretarial auditors and the reviews performed by the Board and its committees, the Board is of the opinion that the company''s internal financial controls were adequate and effective during the financial year 2015-16.

Pursuant to Sec.134 (5) of the Companies Act, 2013 the directors to the best of their knowledge and ability hereby report:

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

ii. that the directors have selected 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 2015-16 and of the profit of the company for the year;

iii. that the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv. that the directors have prepared the annual accounts on a going concern basis;

v. that 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;

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

6. CREDIT RATING

Your company''s domestic credit rating is ''BB '' for long term debt facilities with a Stable outlook and an ''A4 '' for the short term debt facilities assigned by Credit Rating Information Services of India Limited (CRISIL).

7. CERTIFICATIONS

Your company has been certified as ISO 9001:2008 on 30.05.2016 for its quality management systems employed at every level of the organization.

8. AUDITORS AND AUDITORS REPORT

A) Statutory Auditors

M/s Nahata Jain & Associates, Chartered Accountants (Regn. No. 016351N), auditors of your company retire at the ensuing annual general meeting and being eligible offers themselves for re-appointment. The Company has received, letter from the Auditors to the effect that their re-appointment, if made, would be within the prescribed limit under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified for re-appointment.

The Board recommends their appointment as auditors from the conclusion of this AGM to the conclusion of next AGM. The notes on accounts are self-explanatory with regards to auditors'' observations. There were no qualifications, reservations or adverse remarks made by the Auditors for the year under review.

B) Secretarial Auditors

The Board had appointed M/s V.K. Sharma & Company, Practicing Company Secretaries, as Secretarial Auditor to conduct the secretarial audit of the company for the financial year 2015-16, pursuant to the provisions of Section 204 of the Companies Act, 2013. The Report of the Secretarial Auditor forms part of the Board''s Report as Annexure ’A’.

In respect of observations made by the Secretarial Auditors in their Report, it is mentioned that:

1. The company had applied in BSE for listing of 89.05 Lakhs equity shares issued preferentially to the promoter/ promoter group in the year 2008-09. The Company had applied for listing within stipulated time and furnished all requisite documents for the listing of the same to the BSE. Regular follow up has been done with BSE, but certain queries were raised by the exchange in the year 2012. The Company has duly provided with the exchange all required. clarifications and replies and has even paid the additional listing fees, as demanded by BSE. The matter is pending with BSE for its necessary approval.

2. The Company has appealed against the order of Income Tax Department before the Commissioner of Income tax Appeals, New Delhi with in prescribed time limit. The Company''s management including its tax advisors believes that its position will likely be upheld in the appellate process whereby it is expected that the matter will be decided in favour of the Company and the demand raised will be dropped by the Appellate Authorities.

The Board at its meeting held on 13.08.2016 reappointed M/s V.K. Sharma & Company, Practicing Company Secretaries as Secretarial Auditor for FY 2016-17.

9. CORPORATE GOVERNANCE

The Company is complying with the Listing Agreement/SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, as applicable with regard to Corporate Governance and reports to that effect are being regularly filed with the Stock Exchanges. A report on Corporate Governance practices and the Certificate from the Auditors on compliance of the mandatory requirements thereof are made a part of the Annual report.

10. VIGIL MECHANISM

A comprehensive Vigil mechanism/Whistle Blower Policy has already been adopted by the Company which provides adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of employees. The policy as approved by the Board is uploaded on the Company''s website at http://www.kothariyeast.in/financial/policies/whistle_blower_policy.pdf.

11. RISK MANAGEMENT POLICY OF THE COMPANY

Your company has adopted a Risk management policy to identify and categorize various risks, implement measures to minimize impact of these risks where it is deemed necessary and possible, and a process to monitor them on a regular basis.

12. REMUNERATION POLICY AND BOARD EVALUATION

The Board has adopted a Remuneration Policy as recommended by the Nomination & Remuneration Committee. It provides for the criteria for determining Qualifications, Positive Attributes & Independence of the Directors, defining the criteria of the remuneration of the KMP''s and Senior managerial personnel along with their roles and responsibilities. The aim is to ensure that the company attracts and retains competent people.

The Board has carried out an Annual Performance Evaluation of its own performance and the Directors individually. The Disclosures relating to the same are provided in the Corporate Governance Report.

13. DISCLOSURES

a) Number of Board & Committee Meetings:

During the year under review, Five Board meetings, Four Audit Committee meetings, Four Stakeholders Relationship Committee meetings and One Nomination & Remuneration Committee meeting were convened and held. Details and attendance of such Board & Committees meetings are mentioned in Corporate Governance Report. Pursuant to clause VII (1) of Schedule IV of the Companies Act, 2013, the Independent Directors had a separate meeting on 12.03.2016.

b) Deposits - The Company has not accepted any deposit from public during the year under review.

c) Share Capital - There was no change in the Company''s share capital during the year under review.

d) Audit Committee - The Company has duly constituted an Audit Committee, whose detailed composition and powers are provided in the Corporate Governance Report. There were no recommendations of the Audit Committee which have not been accepted by the Board during the financial year.

e) Extract Of Annual Return - The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in Annexure ’B’ and is attached to this Report.

f) Disclosure pertaining to Managerial Remuneration - Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided as per Annexure ’C’.

The information required pursuant to section 197 read with rule 5(2) & (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees will be provided upon request.

g) Related Party Transactions - There were no materially significant transactions with the related parties during the financial year that may have potential conflict with interest of the Company at large. Disclosures relating to the same are provided separately in the Corporate Governance Report.

h) Particulars of Loans, Guarantees or Investments under Section 186 - Details of Loans, Guarantees or Investments under Section 186 of the Companies Act, 2013 are given in the accompanying Financial Statements.

i) Prevention of Sexual Harassment - The Company has zero tolerance for sexual harassment at workplace. A committee has been set up to redress complaints received regarding sexual harassment. During the year, no complaints pertaining to sexual harassment were received.

j) Significant and Material Orders Passed by the Regulators or Courts - No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operation in future.

14. CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The information pertaining to conservation of energy, technology absorption, Foreign exchange Earnings and outgo as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished in Annexure ’D’ and is attached to this report.

ACKNOWLEDGEMENTS

Your Board of Directors is thankful to all the Shareholders for their constant faith reposed in the company. They also placed on record their sincere appreciation for the wholehearted devotion and co-operation extended by the employees at all levels, which has been a source of strength to the company.

The Directors also wish to thank and deeply acknowledge the continued support, guidance and co-operation of the Customers, Auditors, Legal Advisers, Bankers, Dealers, Vendors and other stakeholders of the Company.

For and on behalf of the Board

Place: New Delhi Pramod Kumar Kothari

Date: 13^th of August, 2016 Chairman & Managing Director

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Mar 31, 2015

TO THE MEMBERS

The directors are pleased to present the 25th Annual Report together with the Audited Accounts for the year ended on 31st March 2015:

1. FINANCIAL RESULTS (Rs. In lacs) 2014-2015 2013-2014

Turnover 6433.08 5062.57

Profit before Finance Charges & Depreciation 467.87 372.22

Finance Charges 155.30 126.93

Depreciation 172.65 189.82

Profit before Tax 139.93 55.47

Taxes:

Current Tax 28.25 10.57

Less: MAT Credit Entitlement (28.25) (10.57)

Deferred Tax 53.93 17.54

Net Profit/ (Loss) after Tax 86.00 37.93

2. BUSINESS OPERATIONS

During the year under review, your company achieved production of 14026 MT during 2014-15 as compared to 11462 MT in previous year. Resultantly the turnover of the company from manufacturing activities has increased to Rs. 6433.08 Lacs during the year 2014-15 as compared to Rs. 5062.57 Lacs during previous year recording a growth of 27.07%. The profitability of the company is Rs. 86.00 Lacs during the year 2014-15 as compared to profit of Rs. 37.93 Lacs during previous year.

Though the beginning of the current financial year 2015-16, saw high rise in the prices of the basic raw material, i.e. Molasses and high operational costs but gradually the company utilizing the limited resources available with concerted efforts achieved a turnover growth of 27% and an increase of 126% in the profits after tax.

The operational performance during the year and the future outlook of the Company has been comprehensively covered in the Management Discussion and Analysis Report which is provided as a separate section in the Annual Report.

3. DIVIDEND

Dividend for the year has not been proposed in order to plough back profits for the growth of the Company.

4. DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with the provisions of the Companies Act, 2013 and pursuant to the company's new set of Articles of Association adopted at the 24th AGM, i.e. on 29.09.2014, the Independent Directors of the Company are not be liable to retire by rotation.

In view of the above, and pursuant to Section 152(6), the remaining directors, being Executive Directors, are now made liable to retire by rotation at every Annual General Meeting. Thus, Mrs. Kavita Devi Kothari (DIN: 00120415) Whole-time Director of the Company retire by rotation and being eligible, offers herself for reappointment. Though, such determination of office by retirement and then re-appointment would not constitute a break in her tenure of service as the Whole-Time Director of the Company.

Brief resume of Mrs. Kavita Devi Kothari, nature of her expertise in specific functional areas and the name of the public companies in which she holds the Directorship, as stipulated under Clause 49 of the Listing Agreement, is given in the notice convening the Annual General Meeting. The Board recommends her appointment as such. The Independent Directors have submitted their declaration that they fulfill the requirements as stipulated in Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement.

Pursuant to Section 203 of the Companies Act, 2013, the company designated the existing Chief Financial Officer, Mr. Arun Kumar Sekhani, as the Key Managerial Personnel of the Company. His consent along with all required disclosures as per the Act were duly obtained and recorded.

5. DIRECTORS' RESPONSIBILITY STATEMENT

Based on the framework of internal financial controls and compliance systems established and maintained by the company, work performed by the internal, statutory and secretarial auditors and the reviews performed by the Board and its committees, the Board is of the opinion that the company's internal financial controls were adequate and effective during the financial year 2014-15.

Pursuant to Sec.134 (5) of the Companies Act, 2013 the directors to the best of their knowledge and ability hereby report:

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

ii. that the directors have selected 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 2014-15 and of the profit of the company for the year;

iii. that the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv. that the directors have prepared the annual accounts on a going concern basis;

v. that 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.

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

6. CREDIT RATING

Your company's domestic credit rating is 'BB ' as assigned for long term debt facilities with a Stable outlook and an 'A4 ' for the short term debt facilities assigned by Credit Rating Information Services of India Limited (CRISIL).

7. AWARDS & ACCOLADES

Your company has won the first prize:

- 11th National Award for Excellence in Cost Management - 2013' for FY 2012-13 and

- 12th National Award for Excellence in Cost Management - 2014' for FY 2013-14,

from the prestigious Institute of Cost Accountants of India, Delhi in the Private - Manufacturing Organization. (Small) category. The Award Ceremony was held on 25/11/14 for FY 2012-13 & on 15/7/15 for FY 2013-14.

8. AUDITORS AND AUDITORS REPORT

A) Statutory Auditors

M/s Nahata Jain & Associates, Chartered Accountants (Regn. No. 016351N), auditors of your company retire at the ensuing annual general meeting and being eligible offers themselves for re-appointment. The Company has received letter from the Auditors to the effect that their re-appointment, if made, would be within the prescribed limit under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified for re-appointment.

The Board recommends their appointment as auditors from the conclusion of this AGM to the conclusion of next AGM. The notes on accounts are self-explanatory with regards to auditors' observations. There were no qualifications, reservations or adverse remarks made by the Auditors for the year under review.

B) Secretarial Auditor

The Board had appointed M/s V.K. Sharma & Company, Practising Company Secretaries, as Secretarial Auditor to conduct the secretarial audit of the company for the financial year 2014-15, pursuant to the provisions of Section 204 of the Companies Act, 2013. The Report of the Secretarial Auditor forms part of the Board's Report as Annexure 'A'.

"In respect of observations made by the Secretarial Auditors in their Report, it is mentioned that:

1. The company had applied in BSE for listing of 89.05 lacs equity shares issued preferentially to the promoter/ promoter group in the year 2008-09. The Company had applied for listing within stipulated time and furnished all requisite documents for the listing of the same to the BSE. Regular follow up has been done with BSE, but certain queries were raised by the exchange in the year 2012. The Company has duly provided with the exchange all required clarifications and replies and has even paid the additional. listing fees, as required. The matter is pending with BSE for its necessary approval.

2. The Company has made payment of Rs. 25 Lacs on account of stamp duty for registration of lease deed of the leasehold land of factory, during the year.

The Board at its meeting held on 14.08.2015 reappointed M/s V.K. Sharma & Company, Practising Company Secretaries as Secretarial Auditor for FY 2015-16.

C) Cost Auditors

As per the provisions of erstwhile Companies Act, 1956 read with Companies (Cost Audit Report) Rules, 2011, the Central Government vide its order dated 24th of January, 2012 directed our industry for conducting of Audit of Cost Accounts and Records.

Now, with the introduction of new Companies Act, the Ministry of Corporate Affairs (MCA) has by notification F No. 1/40/2013-CL-V dated 31-12-2014 notified the new Companies (Cost Records and Audit) Rules, 2014. As per new rules, our industry has not been included in the list of industries, which have to conduct Audit of Cost Accounts and Records. Hence, Cost Audit is now not applicable on the company.

9. CORPORATE GOVERNANCE

The Company is complying with Clause 49 of the Listing Agreement with regard to Corporate Governance and reports to that effect are being regularly filed with the Stock Exchanges. A report on Corporate Governance practices and the Certificate from the Auditors on compliance of the mandatory requirements thereof are made a part of the annual report.

10. VIGIL MECHANISM

The Company has established a vigil mechanism which is overseen by the Audit Committee for the genuine concerns expressed by the employees and the Directors. A comprehensive whistle blower policy has already been adopted by the company which provides adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of employees and the Company. The policy as approved by the Board is uploaded on the Company's website at http://www.kothariveast.in/financial/policies/whistle_blower_policv.pdf.

11. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

All related party transactions are negotiated on an arms-length basis and are in the ordinary course of ' business. None of the transactions with any of related parties were in conflict with the Company's interest. Suitable disclosures as required by the Accounting Standards (AS 18) have been made in the notes to the financial statements. Therefore, the provisions of Section 188(1) of the Companies Act, 2013 are not applicable. The policy on dealing with Related Party Transactions as approved by the Board is placed on the website at http://www.kothariveast.in/financial/policies/related_partv_ transactional_policv.pdf.

12. RISK MANAGEMENT POLICY OF THE COMPANY

We have adopted a Risk management policy to identify and categorize various risks, implement measures to minimize impact of these risks where it is deemed necessary and possible, and a process to monitor them on a regular basis.

13. REMUNERATION POLICY AND BOARD EVALUATION

The Board has adopted a Remuneration Policy as recommended by the Nomination & Remuneration Committee. It provides for the following:

- Criteria for determining Qualifications, Positive Attributes & Independence of the Directors.

- The basis for determining remuneration of the Directors, KMP's and other senior managerial personnel. Some of the criteria's are:

- Responsibilities & obligations of the personnel,

- Strategies followed & successfully implemented,

- Performance of the company,

- Annual targets to the extent achieved,

- In-depth knowledge & skills required for the job, etc.

- Defining of the Roles and Responsibilities along with the Remuneration of the KMP's and Senior managerial personnel.

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an Annual Performance Evaluation of its own performance and the Directors individually. The manner of evaluation of Independent Directors, Chairman and the Board as a whole was done at a separate meeting held by Independent Directors. The performance evaluation of Independent Directors was done by entire Board, excluding Directors being evaluated.

14. DISCLOSURES

a) Number of Board & Committee Meetings:

During the year under review, Six Board meetings, Four Audit Committee meetings, Four Stakeholders Relationship Committee meetings and One Nomination & Remuneration Committee meeting were convened and held. Details and attendance of such Board & Committees meetings are mentioned in Corporate Governance Report.

Pursuant to clause VII (1) of Schedule IV of the Companies Act, 2013, the Independent Directors had a separate meeting on 14.02.2015.

The Familiarization Program for the Independent Directors has been developed and has been uploaded on the website at http://www.kothariveast.in/financial/familiarization-programme-for- independent-directors.pdf.

b) Deposits - The Company has not accepted any deposit from public during the year under review.

c) Share Capital - There was no change in the Company's share capital during the year under review.

d) Audit Committee - The Company has duly constituted an Audit Committee, whose detailed composition and powers are provided in the Corporate Governance Report. There were no recommendations of the Audit Committee which have not been accepted by the Board during the financial year.

e) Extract Of Annual Return - The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in Annexure 'B' and is attached to this Report.

f) Disclosure pertaining to Managerial Remuneration - Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided as per Annexure 'C'. No employee is in receipt of remuneration as laid down in sec. 197(12) read with rule 5(2) and (3) of the above said rules. Hence the disclosure is not applicable on the company

g) Particulars of Loans, Guarantees or Investments under Section 186 - There were no loans, guarantees or investments made by the company during the year under review.

h) Prevention of Sexual Harassment - The Company has zero tolerance for sexual harassment at workplace. A policy has been adopted in line with the Sexual harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed there under. During the year, no complaints pertaining to sexual harassment were received.

I No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future.

15. CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The information pertaining to conservation of energy, technology absorption, Foreign exchange Earnings and outgo as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished in Annexure 'D' and is attached to this report.

ACKNOWLEDGEMENTS

Your Board of Directors is thankful to all the Shareholders for their constant faith reposed in the company. They also placed on record their sincere appreciation for the wholehearted devotion and co-operation extended by the employees at all levels, which has been a source of strength to the company.

The Directors also wish to thank and deeply acknowledge the continued support, guidance and co-operation of the Customers, Auditors, Legal Advisers, Bankers, Dealers, Vendors and other stakeholders of the Company.

place: New Delhi For and on behalf of the Board Date: 14th of August, 2015 Pramod Kumar Kothari Chairman & Managing Director

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Mar 31, 2014

TO THE MEMBERS OF KOTHARI FERMENTATION AND BIOCHEM LTD.

The directors are pleased to present the 24th Annual Report together with the Audited Accounts for the year ended on 31st March 2014:

1. FINANCIAL RESULTS (Rs. in lacs)

2013-2014 2012-2013

Turnover 5062.57 4390.50

Profit before Finance Charges & Depreciation 372.22 505.48

Finance Charges 126.93 118.22

Depreciation 189.82 149.43

Profit before Tax 55.47 237.83

Taxes:

Current Tax 10.57 -

Less: MAT Credit Entitlement (10.57) -

Deferred Tax 17.54 73.86

Net Profit/ (Loss) after Tax 37.93 163.97

2. OPERATIONS

The company achieved production of 11462 MT during 2013-14 as compared to 9702 MT in previous year. Resultantly the turnover of the company from manufacturing activities has increased to Rs. 5062.57 Lacs during the year 2013-14 as compared to Rs. 4390.50 Lacs during previous year recording a growth of 15%. The profitability of the company is Rs. 37.93 Lacs during the year 2013-14 as compared to profit of Rs. 163.97 Lacs during previous year. Despite achieving higher production and turnover, the profits during 2013-14 are low in comparison to 2012-13, due to increase in raw material prices and power costs, whereas the market prices of company''s products remained stagnant during the year 2013-14.

It is noteworthy to mention that the company achieved positive results even against the backdrop of general slowdown in the economy and greater stress in several other industries.

Dividend for the year has not been proposed in order to plough back profits for the growth of the Company.

3. CURRENT YEAR''S OUTLOOK

Since the beginning of the current financial year 2014-15, the prices of the basic raw material of the company, i.e. Molasses have gone up due to prevailing conditions of the sugar mills. Due to its low availability in the subsequent months also, it is expected that it may increase further and would affect the profitability of the company.

The management has streamlined the manufacturing process to optimally utilize the limited resources available with the company and is making all efforts to improve the production and profitability of the company during the current year.

4. FIXED DEPOSITS

The Company has not accepted any deposit from public during the year under review, which would fall under section 58-A of the Companies Act, 1956.

5. DIRECTORS

In accordance with the provisions of the Companies Act, 2013 and pursuant to the company''s new set of Articles of Association which is being adopted at the ensuing AGM, the Independent Directors of the Company, namely, Mr. Kapil Dev Puri, Mr. Prasanna Kumar Pagaria and Mr. Ratan Lal Dudheria, whose offices were liable to retire by rotation in terms of the provisions of the Companies Act, 1956, are now required to be appointed by the members for a term of five consecutive years and they shall not be liable to retire by rotation.

The Company has received requisite notices in writing from members proposing Mr. Kapil Dev Puri, Mr. Prasanna Kumar Pagaria and Mr. Ratan Lal Dudheria for appointment as Independent Directors for a term of 5 years. The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013.

In view of the above, and pursuant to Section 152(6), the remaining directors, being Executive Directors, are now made liable to retire by rotation at every Annual General Meeting. Thus, Mr. Pramod Kumar Kothari, Chairman & Managing Director and Mrs. Kavita Devi Kothari, Whole - Time Director, would be liable to retire by rotation.

Mr. Pramod Kumar Kothari, being longest in office, would retire at this AGM. He was appointed as the Chairman & Managing Director of the company for a period of 5 years w.e.f. 1st April, 2013. The said appointment was approved by the members of the company at their 23rd AGM held on 28.09.2013 by way of an Ordinary Resolution. Such determination of office by retirement and then re-appointment would not constitute a break in his tenure of service as the Chairman & Managing Director of the Company. The Board recommends their appointment as such.

6. DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Sec. 217 (2AA) of the Companies Act, 1956 the directors hereby report:

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

ii that the directors have selected accounting policies and applied them consistently and made judgment and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year 2013-14 and of the profit of the company for the year,

iii that the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities,

iv that the directors have prepared the annual accounts on a going concern basis.

7. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO The statement containing the necessary information under 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 to this report as Annexure-I.

8. PERSONNEL

Your company maintains harmonious and cordial relations with all its employees. No employee is drawing salary more than the limits prescribed under section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975.

9. AUDITORS

M/s Nahata Jain & Associates, Chartered Accountants (Regn. No. 016351N), auditors of your company retire at the ensuing annual general meeting and being eligible offers themselves for re-appointment. The Company has received letter from the Auditors to the effect that their re-appointment, if made, would be within the prescribed limit under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified for re-appointment.

The Board recommends their appointment as auditors from the conclusion of this AGM to the conclusion of next AGM. The notes on accounts are self-explanatory with regards to auditors'' observations.

10. COMPLIANCE CERTIFICATE FROM COST AUDITORS

Pursuant to section 233B of Companies Act, 1956 read with Cost Audit Rules 2011, the Company will receive the Cost Audit Report for the Financial Year - 2013-14 from M/s HMVN & Associates, Cost Accountants, Delhi and would file the same with the Government within stipulated time.

The Board in its meeting dated 30.05.2014 and pursuant to Section 148 and all other applicable provisions of the Companies Act, 2013, the Companies (Audit and Auditors) Rules, 2014 and the Cost Audit Rules, 2011, appointed M/s HMVN & Associates, Cost Accountants, Delhi as Cost Auditors for the Financial Year - 2014-15 at a remuneration recommended by the Audit Committee and approved by the Board of Directors. The same is being proposed to be ratified by the shareholders at the ensuing AGM.

The Company has received letter from the Auditors to the effect that their re-appointment, if made, would be within the prescribed limit under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified for re-appointment. The Board recommends for the ratification of the remuneration payable to the Cost Auditors.

11. CORPORATE GOVERNANCE

The Company is complying with Clause 49 of the Listing Agreement with regard to Corporate Governance and reports to that effect are being regularly filed with the Stock Exchanges. Pursuant to Clause 49 of the Listing Agreement, a Corporate Governance Report is made a part of this annual report.

A certificate from the auditors of the Company regarding compliance of the conditions of Corporate Governance as stipulated by Clause 49 of the Listing Agreement is attached with this report.

The Company has also obtained declaration from the Directors and Senior Management members of the Company for compliance of the Code of Conduct and Ethics and the Certificate from CEO/CFO was placed before the Board of Directors.

12. MANAGEMENT DISCUSSION AND ANALYSIS

A report on Management Discussion and Analysis (MDA), which forms part of this Report, inter-alia, deals adequately with the operations and also the current and future outlook of the Company.

ACKNOWLEDGEMENTS

Your Board of Directors is thankful to all the Shareholders for their constant faith reposed in the company. They also placed on record their sincere appreciation for the wholehearted devotion and co-operation extended by the employees at all levels, which has been a source of strength to the company.

The Directors also wish to thank and deeply acknowledge the continued support, guidance and co-operation of the Customers, Auditors, Legal Advisers, Bankers, Dealers, Vendors and other stakeholders of the Company.

For and on behalf of the Board

Place: New Delhi Pramod Kumar Kothari

Date : 14th August, 2014 Chairman & Managing Director

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Mar 31, 2013

TO THE MEMBERS OF KOTHARI FERMENTATION AND BIOCHEM LTD.

The directors are pleased to present the 23rd Annual Report together with the Audited Accounts for the year ended on 31st March 2013:

1. FINANCIAL RESULTS (Rs. in lacs)

2012-2013 2011-2012

Turnover 4390.50 3524.90

Profit before Finance Charges & Depreciation 505.48 478.67

Finance Charges 118.22 103.44

Depreciation 149.43 143.04

Profit before Tax 237.83 232.19

Taxes (Deferred Tax) 73.86 71.80

Net Profit/ (Loss) after Tax 163.97 160.39

2. OPERATIONS

The introduction of professional approach towards management of the resources of the company helped in the company''s growth and efficient and effective utilization of the same. During the year, capital expenditure incurred on equipments resulted in better utilization of plant & machineries. Also various steps initiated in the previous years for increasing production and improving operating efficiencies have paved the way towards meeting the growth targets of the company. The company achieved production of 9702 MT during 2012-13 as compared to 8481 MT in previous year. Resultantly the turnover of the company from manufacturing activities has increased to Rs. 4390.50 Lacs during the year 2012-13 as compared to Rs. 3524.90 Lacs during previous year recording the growth of 24%. The profitability of the company is Rs. 163.97 Lacs during the year 2012-13 as compared to profit of Rs. 160.39 Lacs during previous year. Dividend for the year has not been proposed in order to plough back profits for the growth of the Company.

3. CURRENT YEAR''S OUTLOOK

In view of the efforts made, it is noteworthy to mention that the company achieved positive results even against the backdrop of general slowdown in the economy and greater stress in several other industries, such as textiles, steel, mining, infrastructure, etc.

Also the company has made additional investments in plant & machineries and is optimistic of achieving higher levels of production. Various control systems have been deployed for the reduction of costs and improving of the operating efficiencies.

Further, it is expected that the production and profitability of the company will substantially improve during the current year.

4. FIXED DEPOSITS

The Company has not accepted any deposit from public during the year under review, which would fall under section 58- A of the Companies Act, 1956.

5. DIRECTORS

During the year, the company suffered with an irreparable loss in the form of sudden demise of Mr. Moti Lal Kothari, Chairman of the Company on 03.09.2012.

Mr. Moti Lal Kothari, was a great visionary, a great leader and above all a great humanist who showered equal love and regard for all irrespective of their positions in society.

He was the Promoter Director of the Company, whose contributions were commendable and unparallel. His sincere efforts, guidance and wise advises helped the company achieve its present position and hope that it would flourish and fulfill the dreams and visions as sought by our beloved Mr. Moti Lal Kothari.

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company, Mr. Ratan

Lal Dudheria is retiring from the Board by rotation and being eligible offers himself for reappointment.

Mr. Pramod Kumar Kothari was appointed as the Managing Director by the Shareholders in the AGM held on 30.09.2009.

Due to the sad demise of Mr. Moti Lal Kothari, responsibilities of Mr. Pramod Kumar Kothari, Managing Director of the

Company has tremendously increased, thus, he is proposed to be re-appointed with varied terms and conditions.

Mrs. Kavita Devi Kothari was appointed as Additional Director by the Board on 01.04.2013. She was also appointed as the Whole-Time Director of the Company w.e.f. 01.04.2013 for a period of 5 (Five) years, subject to the approval of the members in this Annual General Meeting.

The Board recommends their appointment as such.

6. DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Sec.217 (2AA) of the Companies Act, 1956 the directors hereby report:

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

ii that the directors have selected accounting policies and applied them consistently and made judgment and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year 2012-13 and of the profit of the company for the year,

iii that the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities,

iv that the directors have prepared the annual accounts on a going concern basis.

7. CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The statement containing the necessary information under 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 to this report as

Annexure-I.

8. PERSONNEL

Your company maintains harmonious and cordial relations with all its employees. No employee is drawing salary more than the limits prescribed under section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975.

9. AUDITORS

M/s Nahata Jain & Associates, Chartered Accountants (Regn. No. 016351N), auditors of your company retire at the ensuing annual general meeting and being eligible offers themselves for re-appointment. The Board recommends their appointment as auditors from the conclusion of this meeting to the conclusion of next annual general meeting. The notes on accounts are self-explanatory with regards to auditors'' observations.

10. COMPLIANCE CERTIFICATE FROM COST AUDITORS

Pursuant to section 233B of Companies Act, 1956 read with Cost Audit Rules 2011, the Company will receive the Cost Audit Report for the Financial Year - 2012-13 from M/s HMVN & Associates, Cost Accountants, Delhi and would file the same with the Government within stipulated time.

The Cost Audit Report for the financial year 2011-2012 which was due to be filed with the Ministry of Corporate Affairs on or before January 31, 2013 was filed on January 22, 2013.

The Board of Directors of your Company has recommended M/s HMVN & Associates, Cost Accountants, Delhi to be appointed as a Cost Auditors for the Financial Year-2013-14, subject to approval of the Central Government under section 233B of the Companies Act, 1956.

11. CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, a Corporate Governance Report is made a part of this annual report.

A certificate from the auditors of the Company regarding compliance of the conditions of Corporate Governance as stipulated by Clause 49 of the Listing Agreement is attached with this report.

The Company is complying with Clause 49 of the Listing Agreement with regard to Corporate Governance and reports to that effect are being regularly filed with the Stock Exchanges. The Company has obtained declaration from the Directors and Senior Management members of the Company for compliance of code of conduct and the Certificate from CEO/CFO was placed before the Board of Directors.

12. MANAGEMENT DISCUSSION AND ANALYSIS

A report on Management Discussion and Analysis (MDA), which forms part of this Report, inter-alia, deals adequately with the operations and also the current and future outlook of the Company.

ACKNOWLEDGEMENTS

Your Board of Directors are thankful to all the Shareholders for their constant faith reposed in the company. They also placed on record their sincere appreciation for the wholehearted devotion and co-operation extended by the employees at all levels, which has been a source of strength to the company.

The Directors also wish to thank and deeply acknowledge the continued support, guidance and co-operation of the Customers, Auditors, Legal Advisers, Bankers, Dealers, Vendors and other stakeholders of the Company.

For and on behalf of the Board

Place: New Delhi Pramod Kumar Kothari

Date :12th August, 2013 Managing Director

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Mar 31, 2012

TO THE MEMBERS OF KOTHARI FERMENTATION AND BIOCHEM LTD.

The directors are pleased to present the 22nd Annual Report together with the Audited Accounts for the year ended on 31st March 2012:

1. FINANCIAL RESULTS (Rs. in lacs)

2011-2012 2010-2011

TURNOVER: MANUFACTURING 3524.90 2480.30

PROFIT BEFORE INTEREST & DEPRECIATION 478.67 308.06

FINANCE CHARGES 103.44 29.94

DEPRECIATION 143.04 138.33

PROFIT BEFORE TAX 232.20 139.79

TAXES (Deferred Tax) 71.80 NIL

NET PROFIT/(LOSS) AFTER TAX FOR THE YEAR 160.39 139.79

2. OPERATIONS

During the year, the capital expenditure incurred on balancing equipments has resulted in better utilization of plant & machineries. Various steps have been initiated for increasing production and improving operating efficiencies.

The company achieved production of 8481 MT during 2011-12 as compared to 6530 MT in previous year. Resultantly the turnover of the company from manufacturing activities has Increased to Rs. 3524.90 Lacs during the year 2011-12 as compared to Rs. 2480.30 Lacs during previous year. The profitability of the company is Rs. 160.39 Lacs during the year 2011-12 as compared to profit of Rs. 139.79 Lacs during previous year.

Dividend for the year has not been proposed in order to plough back the profit for the growth of the Company.

3. CURRENT YEAR'S OUTLOOK

The additional investment made in plant & machineries will result in increase of production. Various steps have been taken for cost reduction and improving operating efficiencies.

The Company Plan to Install additional Equipment in Plant and Machinery which will result in increase of production as well as up-gradation of the quality of the products.

In view of above it is expected that the production and profitability of the company will substantially improve during the current year.

The State Excise department have increased the quota of molasses from 17352 MT per annum to 30720 MT per annum. Electricity connection load have also been enhanced from 1700 KVA to 3000 KVA. This will result in sufficient availability of resources and increase in production.

4. FIXED DEPOSITS

The Company has not accepted any deposit from public during the year under review, which would fall under section 58-A of the Companies Act, 1956.

5. DIRECTORS

In accordance with the provisions of the Companies Acts, 1956 and the Articles of Association of the Company, Mr.Prasanna Kumar Pagaria is retiring from the Board by rotation and being eligible offers himself for reappointment.

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

The statement containing the necessary information under 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 to this report as Annexure-I.

7. PERSONNEL

Your company keeps harmonious relations with all its employees. No employee is drawing salary more than the limits prescribed under section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975.

8. AUDITORS

M/s Nahata Jain & Associates, Chartered Accountants, auditors of your company retire at the ensuing annual general meeting and being eligible offers themselves for re-appointment. The Board recommends their appointment as auditors from the conclusion of this meeting to the conclusion of next annual general meeting. The notes on accounts are self-explanatory with regards to auditors' observations.

9. COMPLIANCE CERTIFICATE FROM COST AUDITORS

Pursuant to section 233B of Companies Act, 1956 read with Cost Audit Rules 2011, the Company will receive the "Cost Audit Compliance Report for the Financial Year-2011-12 from M/s HMVN & Associates, Cost Accountants, Delhi and file the same with Govt. within stipulated time.

10. COST AUDITOR

The Board of Directors of your Company has recommended M/s HMVN & Associates, Cost Accountants, Delhi to be appointed as a Cost Auditors for the Financial Year-2012-13, subject to approval of the Central Government under section 233B of the Companies Act, 1956.

11. LISTING OF SHARES

The company's shares are listed at Stock Exchanges situated at Delhi, Mumbai, Kolkata, Jaipur and Guwahati. The listing at Delhi and Mumbai is continued, and the listing fee has been paid upto date. Action has already been initiated for delisting of shares from stock exchanges at Kolkata, Jaipur, and Guwahati. All the formalities have been complied with in relating to delisting and as such the listing fee to these Stock Exchanges were not paid.

12. CORPORATE GOVERNANCE

The provisions of clause 49 of the listing agreement relating to corporate governance are applicable to the company. So there is a separate section on Corporate Governance in the annual report of the company, with a detailed compliance report on Corporate Governance.

11. MANAGEMENT DISCUSSION AND ANALYSIS

A report on Management Discussion and Analysis (MDA), which forms part of this Report, inter-alia, deals adequately with the operations as also current and future outlook of the Company.

12. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Sec.217 (2AA) of the Companies Act, 1956 the directors hereby report:

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

b) that the directors have selected 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 2011-12 and of the profit or loss of the company for that year.

c) that the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities,

d) that the directors have prepared the annual accounts on a going concern basis.

13. ACKNOWLEDGEMENTS

Your directors place on record their sincere appreciation for the wholehearted devotion and co-operation extended by the employees at all levels, which has been a source of strength of the company.

The directors also wish to thank and deeply acknowledge the cooperation, assistance and support extended by the shareholders, the Dealers, vendors, bankers and financial institution of the Company.

For and on behalf of the Board Pramod Kumar Kothari Managing Director

Place : New Delhi Date : 29th August, 2012

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Mar 31, 2011

TO THE MEMBERS OF

KOTHARI FERMENTATION AND BIOCHEM LTD.

The Directors are pleased to present the 21st Annual Report together with the Audited Accounts for the year ended on 31st March 2011:

1. FINANCIAL RESULTS (Rs. in lacs)

2010-2011 2009-2010

TURNOVER:

MANUFACTURING 2480.30 1590.48

TRADING 0.00 317.04

PROFIT BEFORE INTEREST & DEPRECIATION 299.31 207.44

INTEREST CHARGES 21.19 2.02

DEPRECIATION 138.33 127.68

PROFIT BEFORE TAX 139.79 77.64

TAXES NIL NIL

NET PROFIT/ (LOSS) AFTER TAX 139.79 77.64

2. OPERATIONS

During the year, the capital expenditure incurred on balancing equipments has resulted in better utilization of plant & machineries. Various steps have been initiated for further increasing production and improving operating efficiencies.

The company achieved production of 6530 MT during 2010-11 as compared to 4304 MT in previous year. Resultantly the turnover of the company from manufacturing activities has Increased to Rs. 2480.30 Lacs during the year 2010-11 as compared to Rs. 1590.48 Lacs during previous year. The profitability of the company is Rs. 139.79 Lacs during the year 2010-11 as compared to profit of Rs. 77.64 Lacs during previous year.

Dividend for the year has not been proposed in order to plough back the profit for the growth of the Company.

3. CURRENT YEAR'S OUTLOOK

The additional investment made in plant & machineries will result in increase of production. Various steps have been taken for cost reduction and improving operating efficiencies.

The Company further Plans to Install additional Balancing Equipment in Plant and Machinery which will result increase in production as well as up-gradation of the quality of the products

In view of above it is expected that the production and profitability of the company will substantially improve during the current year.

4. FIXED DEPOSITS

The Company has not accepted any deposit from public during the year under review, which would fall under section 58- A of the Companies Act, 1956.

5. DIRECTORS

In accordance with the provisions of the Companies Act, 1956 and the articles of Association of the Company, Mr. Mal Chand Sharma is retiring from the Board by rotation and does not offers himself for re-appointment. The Board places on record its sincere appreciation for the contribution and support of Mr. Mal Chand Sharma during his tenure with the Company.

It is proposed to appoint Shri Kapil Dev Puri as Director liable to retire by rotation in the ensuing AGM. He will be a Non Executive Independent Director of the company. The Board recommends his appointment as director of the company.

6. CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The statement containing the necessary information under 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 to this report as Annexure-I.

7. PERSONNEL

Your company keeps harmonious relations with all its employees. No employee is drawing salary more than the limits prescribed under section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975.

8. AUDITORS

M/s Nahata Jain & Associates, Chartered Accountants, auditors of your company retire at the ensuing annual general meeting and being eligible offers themselves for re-appointment. The Board recommends their appointment as auditors from the conclusion of this meeting to the conclusion of next annual general meeting. The notes on accounts are self- explanatory with regards to auditors' observations.

9. LISTING OF SHARES

The company's shares are listed at Stock Exchanges situated at Delhi, Mumbai, Kolkata, Jaipur and Guwahati. The listing at Delhi and Mumbai is continued, and the listing fee has been paid upto date. Action has already been initiated for delisting of shares from stock exchanges at Kolkata, Jaipur, and Guwahati. All the formalities have been complied with in relating to delisting and as such the listing fee to these Stock Exchanges were not paid.

10. CORPORATE GOVERNANCE

The provisions of clause 49 of the listing agreement relating to corporate governance are applicable to the company. So there is a separate section on Corporate Governance in the annual report of the company, with a detailed compliance report on Corporate Governance.

11. MANAGEMENT DISCUSSION AND ANALYSIS

A report on Management Discussion and Analysis (MDA), which forms part of this Report, inter-alia, deals adequately with the operations as also current and future outlook of the Company.

12. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Sec.217 (2AA) of the Companies Act, 1956 the Directors hereby report:

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

b) that the directors have selected accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year 2010-11 and of the profit of the company for that year.

c) that the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities,

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

13. ACKNOWLEDGEMENTS

Your Directors place on record their sincere appreciation for the wholehearted devotion and cooperation extended by the employees at all levels, which has been a source of strength of the company.

The Directors also wish to thank and deeply acknowledge the cooperation, assistance and support extended by the shareholders, the Dealers, vendors, bankers and financial institution of the Company.

For and on behalf of the Board

Place : New Delhi Moti Lal Kothari

Date :12th August, 2011 Chairman & Managing Director

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Mar 31, 2010

The Directors are pleased to present the 20th Annual Report together with the Audited Accounts for the year ended on 31st March 2010:

1. FINANCIAL RESULTS (Rs. in lacs)

2009-2010 2008-2009 TURNOVER:

MANUFACTURING 1590.48 1914.46

TRADING 317.04 412.50

PROFIT BEFORE INTEREST & DEPRECIATION 207.44 223.23

INTEREST 2.12 14.38

DEPRECIATION 127.68 110.64

PROFIT BEFORE TAX 77.64 98.21

TAX - Fringe Benefit NIL 3.72

NET PROFIT/ (LOSS) AFTER TAX 77.64 94.49



2. OPERATIONS



During the year, the capital expenditure on balancing equipments has resulted in better utilization of plant & machineries. Various steps have been initiated for increasing production and improving operating efficiencies. The Company had undertaken trading activities during the year 2009-10 and had two segments i.e. manufacturing of yeast and trading of commodities.

The company achieved production of 4304 MT during 2009-10 as compared to 5185 MT in previous year. Resultantly the turnover of the company from manufacturing activities has decreased to Rs. 1590.48 Lacs during the year 2009-10 as compared to Rs. 1914.46 Lacs during previous year. The Company undertook trading activities during the year 2009-10 resulting in turnover of Rs. 317.04 Lacs. The profitability of the company was Rs. 77.64 Lacs during the year 2009-10 as compared to profit of Rs. 94.49 Lacs during previous year. The decrease in Turnover was mainly due to closer of the factory for about one and half months due to upgrading of effluent treatment plant due to requirement of pollution department. Dividend for the year has not been proposed in order to plough back the profit for growth of the Company.

3. CURRENT YEARS OUTLOOK

The additional investment made in plant & machineries will result in increase of production. Various steps have been taken for cost reduction and improving operating efficiencies.

In view of above it is expected that the production and profitability of the company shall improve during the current year.

4. FIXED DEPOSITS

The Company has not accepted any deposit from public during the year under review, which would fall under section 58-A of the Companies Act, 1956.



5. DIRECTORS

In accordance with the provisions of the Companies Acts, 1956 and the Articles of Association of the Company, Mr. Ratan Lal Dudheria is retiring from the Board by rotation and being eligible offers himself for re-appointment. The Board recommends re-appointment of Mr. Ratan Lal Dudheria as Director of the Company.

6. CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The statement containing the necessary information under 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 to this report as Annexure-I.

7. PERSONNEL

Your company keeps harmonious relations with all its employees. No employee is drawing salary more than the limits prescribed under section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975.

8. AUDITORS

M/s Nahata Jain & Associates, Chartered Accountants, Auditors of your company retire at the ensuing annual general meeting and being eligible offers themselves for re-appointment. The Board recommends their appointment as auditors from the conclusion of this meeting to the conclusion of next annual general meeting. The notes on accounts are self-explanatory with regard to auditors observations.

9. LISTING OF SHARES

The companys shares are listed at Stock Exchanges situated at Delhi, Mumbai, Kolkata, Jaipur and Guwahati. The listing at Delhi and Mumbai is continued, and the listing fee has been paid upto date. Action has already been initiated for delisting of shares from stock exchanges at Kolkata, Jaipur, and Guwahati. All the formalities have been complied with in relating to delisting and as such the listing fee to these Stock Exchanges were not paid.

10. CORPORATE GOVERNANCE

The provisions of clause 49 of the listing agreement relating to corporate governance are applicable to the company. So there is a separate section on Corporate Governance in the annual report of the company, with a detailed compliance report on Corporate Governance.

11. MANAGEMENT DISCUSSION AND ANALYSIS

A report on Management Discussion and Analysis (MDA), which forms part of this Report, inter-alia, deals adequately with the operations as also current and future outlook of the Company.

12. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Sec.217 (2AA) of the Companies Act, 1956 the Directors hereby report:

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

b) that the Directors have selected 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 2009-10 and of the profit or loss of the company for that year;

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

d) that the Directors have prepared the Annual Accounts on a going concern basis.

13. ACKNOWLEDGEMENTS

Your Directors place on record their sincere appreciation for the wholehearted devotion and commitment extended by the employees at all levels, which have been a source of strength and inspiration to the company.

The Directors also wish to thank and deeply acknowledge the cooperation, assistance and support extended by the shareholders, the Dealers, vendors, bankers and financial institution of the company.

For and on behalf of the Board

Place : New Delhi MOTI LAL KOTHARI

Date :14th August, 2010 Chairman & Managing Director