Directors Report of R J Bio Tech Ltd.

Mar 31, 2015

Dear Members,

The directors have pleasure in presenting the Tenth Annual Report on the business and operations of Company and the financial accounts for the year ended 31st March 2015.

Financial Highlights:

The financial highlights of your Company, for the year ended 31st March, 2015 are summarized below:

(Rs. In Lakhs)

Particulars 2014-15 2013-14

Net Sales 3166.83 2868.11

Less: Total Expenses 2660.86 2316.81

Operating Profit 505.97 551.30

Less: Interest Expenses 359.54 264.09

Profit Before Tax 146.43 287.21

Profit After Tax 146.37 287.21

Surplus carried forward to Balance 146.37 287.21 Sheet

Basic Earnings per share (In Rs.) 1.55 3.48

Operational review:

Unfavourable rainfall has continued to hit the agriculture sector yet again for the current year. Your Company has survived such a situation and has managed to attain the increased turnover as compared to the previous year.

Dividend:

Your Directors have recommended retaining the profit and declaring no dividend for the financial year 2014-15. The dividend policy for the year under review has been formulated taking into consideration of growth of the company and reduce the debt servicing burden.

Financial Statements

Full version of the Annual Report 2014-15 containing complete Balance Sheet, Statement of Profit & Loss, other statements and notes thereto, prepared as per the requirements of Schedule III to the Companies Act, 2013, Directors' Report (including Management Discussion and Analysis, Corporate Governance Report) are being sent via email to all shareholders who have provided their email address(es).

Full version of Annual Report 2014-15 is also available for inspection at the registered office of the Company during working hours upto the date of ensuing Annual General Meeting (AGM). It is also available at the Company's website at www.rjbiotech.com

Credit Rating

During the period under review the rating committee of ICRA, after due consideration, assigned a long term credit rating of (ICRA) BB (pronounced as ICRA double B plus) to the line of credit (LOC) facility enjoyed by the Company. The outlook on the long term rating is stable.

Corporate Governance:

Company continues to adhere to better Corporate Governance, true & fair practices. A detailed report is annexed as ANNEXURE I and forms part of this report. The Certificate issued by Nitin S. Sharma, Practising Company Secretary, confirming the compliance of the conditions of Corporate Governance as stipulated under clause 52 of the SME Listing Agreement, entered by Company with Bombay Stock Exchange, is annexed as ANNEXURE II and forms this report.

Further CEO Certification ensuring the genuineness of financial reports and as required under clause 52 of SME Listing Agreement, is given in the Corporate Governance report.

Directors:

Director retiring by rotation:

Mrs. Meena Raghavendra Joshi (holding DIN 00307708) retires by rotation under Section 152 of the Companies Act, 2013 and being eligible, offers herself for re-appointment.

The brief resume of Mrs. Joshi, the nature of her expertise in specific functional areas, names of the companies in which she has held directorships, committee memberships / chairmanships, her shareholding etc. are furnished in the explanatory statement to the notice of the ensuing AGM.

Declaration by Independent Directors:

Your Company has received declarations from Mr. Chandra Prakash Tripathi, Mr. Balaji Singh and Mr. Anil Dharmadhikari, Independent Directors, under provisions of Section 149(7) of the Companies Act, 2013, stating that they meet the criteria of independence as provided in sub-section (6) of Section 149 of the Companies Act, 2013 and Clause 52 of Listing Agreement.

Number of Meetings of the Board of Directors and Committee Meetings

The details regarding the number of meetings of the Board of Directors and Committee meetings during the period under review is given in the Corporate Governance Report.

Performance Evaluation of the Board, its Committees and Individual Directors

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

Key Managerial Personnel

The Key Managerial Personnel (KMP) in the Company as per Section 2(51) and 203 of the Companies Act, 2013 are as follows:

Mr. Omprakash Jaiswal Chief Executive Officer and Manager

Mr. Mitesh Gadhiya Company Secretary

Mrs. Aarti Pawar Chief Financial Officer

Mrs. Aarti Pawar was appointed as the Chief Financial Offer on April 1, 2015 in place of Mr. Harshwardhan Joshi, who resigned from the post of Chief Financial Officer on March 31, 2015.

Statutory Auditors:

In the Ninth Annual General Meeting of the Company, M/s Ashok Patil & Associates, Chartered Accountants (ICAI Registration No. 122045W), were appointed as the Statutory Auditors of the Company to hold office until the conclusion of the Fourteenth Annual General Meeting subject to ratification of the members in every Annual General Meeting. Board recommends their ratification as statutory auditors for Financial Year 2015-16.

The Statutory Auditor's Report to the members does not contain any qualification. The observations of the Statutory Auditors in their report are self-explanatory and therefore, in the opinion of the Directors, do not call for further comments.

Secretarial Auditors:

As per the provisions of Section 204 of the Companies Act, 2013 and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed M/s Nitin S. Sharma & Associates, Practising Company Secretaries, Aurangabad to undertake the Secretarial Audit of the Company for the FY 2014-15. The Secretarial Audit Report in Form No. MR-3 for the FY 2014-15 is annexed herewith as ANNEXURE III and forms a part of this report.

There are no qualifications or observations or other remarks of the Secretarial Auditors in the Report issued by them for the financial year 2014-15 which call for any explanation from the Board of Directors.

Management Discussion and analysis:

A detailed report on the Management Discussion and analysis is annexed as ANNEXURE IV and forms part of this report.

Establishment of Vigil Mechanism for Directors and Employees

Pursuant to the provisions of Section 177(9) and (10) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, the Company has established a vigil mechanism for Directors and employees of the Company.

Nomination and Remuneration Policy:

Pursuant to the requirement under Section 134(3)(e) and Section 178(3) of the Companies Act, 2013, the Nomination and Remuneration Committee of the Board of Directors has adopted a Charter which deals with the manner of selection of Board of Directors and Managing Director and their remuneration. The Nomination and Remuneration policy of the Company has been disclosed in the Corporate Governance Report.

Particulars of remuneration of Directors / KMP / Employees

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rules 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached to this Report as ANNEXURE V.

No employee was in receipt of remuneration for the financial year 2014-15 above the limit as specified in Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Related Party Transactions:

Pursuant to Sub-Section 1 of Section 188 of the Companies Act, 2013, there were no related party transactions entered into by the Company during the financial year 2014-15. The related party disclosures as per Accounting Standard 18, issued by the Institute of Chartered Accountants of India, are as mentioned in Note No. 33 of Notes to Accounts in the Annual Report.

The conservation of Energy and Technology Absorption, Foreign Earnings and Outgo:

Information in accordance with the provisions of Section 134 (3) (m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is given in ANNEXURE VI which forms part of this Report.

Particulars of Loans, Guarantees or Investments under Section 186 of the Companies Act, 2013

There is no loan given or guarantee provided or investment made by the Company during the financial year 2014-15 as per Section 186 of the Companies Act, 2013.

Extract of the Annual Return

In accordance with requirements under Section 134(3)(a) of the Companies Act, 2013, the details forming part of the extract of the Annual Return in form MGT 9 is given in ANNEXURE VII.

Disclosure on Audit Committee

The Audit Committee of the Company was reconstituted on May 5, 2014. The Committee comprises of the following Independent Directors:

i. Mr. Balaji Prithviraj Singh (Chairman)

ii. Mr. Chandra Prakashtripathi

iii. Mr. Anil Vasant Dharmadhikari

All the recommendations of the Audit Committee were accepted by the Board of Directors.

Risk Assessment and Management:

Your Company has been on a continuous basis reviewing and streamlining its various operational and business risks involved in its business. Your Company also takes all efforts to train its manpower from time to time to handle and minimise these risks.

Directors' Responsibility Statement:

Pursuant to the requirements under Section 134 (3) (c) of the Companies Act, 2013, with respect to Directors Responsibility Statement, it is hereby confirmed that:

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same;

(b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profits of the Company for that period;

(c) 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;

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

(e) the Directors have laid down internal financial controls for the Company and such internal financial controls are adequate and operating effectively; and

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

Fixed Deposits:

Your Company has not accepted any deposits under Section 73 of the Companies Act, 2013 during the period under review.

Internal Control

The Company has an efficient internal control system. The Internal Auditors are an integral part of the internal control system of the Company. To maintain its objective and independence, the Internal Auditors report to the Audit Committee of the Board. The Internal Auditors monitor and evaluate the efficacy and adequacy of internal control systems in the Company.

Nature of Business

There has been no change in the nature of business of the Company.

Industrial Relations:

The Company enjoyed cordial relations with its employees at all levels. Your Directors appreciate the support and co-operation provided by all the employees.

Listing:

Your Company's shares continue to be listed on the SME platform of BSE Limited. The listing fee to BSE Limited for the year 2015-16 has been paid by your Company on time.

Policy against Sexual Harassment at Workplace:

Pursuant to the provisions of Section 4(1) of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has constituted an Internal Complaints' Committee. No cases of Sexual Harassment were received during the period under review.

E-voting:

In compliance with the provisions of Section 108 of the Act and the Rules framed there under, the Members are provided with the facility to cast their vote electronically, through the e-voting services provided by CDSL, on all the resolutions set forth in the Notice. The e-voting period commences on Saturday, 26th September, 2015 (10:00 a.m. IST) and ends on Monday, 28th September, 2015 (5:00 p.m. IST). During this period, Members of the Company, holding shares either in physical form or in dematerialised form, as on 22nd September, 2015, may cast their vote electronically. The e-voting module shall be disabled by CDSL for voting thereafter. Once the vote on a resolution is cast by a Member, he shall not be allowed to change it subsequently. A separate communication is being sent to the Members to avail of the e-voting facility.

Acknowledgements:

Your Directors are pleased to express their gratitude for all the co-operation and assistance received from bankers, members, customers, vendors, various Government authorities and employees for their support and faith in the Company.

For and on Behalf of Board Date: 28th August 2015 Place: Aurangabad Sd/- RAGHAVENDRA JOSHI (Chairman)

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Mar 31, 2014

To the Members,

The directors have pleasure in presenting the Ninth Annual Report on the business and operations of Company and the financial accounts for the year ended 31st March 2014.

Particulars 2013-14 2012-13

Net Sales 2868.11 1985.19

Less: Total Expenses 2316.81 1620.67

Operating Profit 551.30 364.52

Less: Interest Expenses 264.09 233.95

Profit Before Tax 287.21 130.57

Profit After Tax 287.21 130.35

Surplus carried forward to Balance Sheet 287.21 130.35

Basic Earnings per share (Face Value of Rs. 10) 3.48 1.94

Operational review:

Unfavourable situation for Indian agriculture has taken hit for third straight year. Situation for operating business are highly unfavourable. Your company in its Ninth Financial Year has achieved a record increase in its revenue''s and a benchmark performance in its operations. Improvement in supply chain management and increasing use of sophisticated technologies has helped us to achieve benchmark performance.

Company is keen in developing high technological seeds which will further cater to growth.

Key Financial Highlights:

3 Revenue from operations / Net sales increased by whopping 44% i.e. from Rs. 19.85 Crores to Rs. 28.68 Crores.

3 Whereas, Ratio of Total Expenditure to Net Sales remained unchanged.

3 Operating profit increased by 51.24 % i.e. from Rs. 3.64 Crores to Rs. 5.51 Crores.

3 Profit before tax increased by 120% i.e. from Rs. 130.57 Million to Rs. 287.21 Million.

3 Profit after tax increased by 120% i.e. from Rs. 130.55 Million to Rs. 287.21 Million.

3 Earnings per share increased by 1.54 i.e. from Rs. 1.94 to Rs. 3.48 3 Substantial Expenditure is being expended on Research and Development activities.

3 Book Value of Shares increased from Rs. 20.70 to Rs. 23.53

Dividend:

Your Directors have recommended retaining the profit and declaring no dividend for the financial year 2013-14. The dividend policy for the year under review has been formulated taking into consideration of growth of the company and reduce the debt servicing burden.

Directors:

Mr. Shashikant Shastri (holding DIN 00307652) retires by rotation under Section 152 of the Companies Act, 2013 and being eligible, offers himself for re-appointment.

Mr. Anil Dharmadhikari (holding DIN 06410911) retires by rotation under Section 152 of the Companies Act, 2013 and being eligible, offers himself for re-appointment. Pursuant to Section 149 read with Schedule IV of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014 and Clause 52 of the Listing Agreement, Mr. Anil Dharmadhikari to be appointed as Independent Director of the Company at the ensuing Annual General Meeting.

Pursuant to Section 149 read with Schedule IV of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014 and Clause 52 of the Listing Agreement, Mr. Chandra Prakash Tripathi (holding DIN 03150939) and Mr. Balaji Singh (holding DIN 06413344) to be appointed as Independent Director of the Company at the ensuing Annual General Meeting.

Statutory Auditors:

M/s Ashok Patil & Associates, Chartered Accountants (ICAI Registration No. 122045W), Statutory Auditors of the Company for Financial Year 2013-14 offer themselves for re-appointment. Based on the audit committee''s recommendation, Board recommends their re-appointment as statutory auditors for Financial Year 2014-15.

Corporate Governance:

Company continues to adhere to better Corporate Governance, true & fair practices. A detailed report is annexed as ANNEXURE I and forms part of this report. The Certificate issued by Neha P. Agrawal, Practising Company Secretary, confirming the compliance of the conditions of Corporate Governance as stipulated under clause 52 of the SME Listing Agreement, entered by Company with Bombay Stock Exchange, is annexed as ANNEXURE II and forms this report.

Further CEO Certification ensuring the genuineness of financial reports and as required under clause 52 of SME Listing Agreement, is given in the Corporate Governance report.

Management Discussion and analysis:

A detailed report on the Management Discussion and analysis is annexed as ANNEXURE III and forms part of this report.

Auditors Report:

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

The conservation of energy, technology absorption, foreign exchange earnings and outgo:

Information in accordance with the provisions of 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 given in ANNEXURE IV which forms part of this Report

Risk Assessment and Management:

Your Company has been on a continuous basis reviewing and streamlining its various operational and business risks involved in its business. Your Company also takes all efforts to train its manpower from time to time to handle and minimise these risks.

Directors'' Responsibility Statement:

Pursuant to the requirements under Section 217(2AA) of the Companies Act, 1956, with respect to Directors Responsibility Statement, it is hereby confirmed that:

1. In preparation of the annual accounts for the year ended 31st March, 2014, the company has followed the applicable accounting standards and there are no material departures from the same.

2. The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of state of affair of the Company as at 31st March, 2014 and of the profit of the Company for the year ended on that date.

3. 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.

4. The Directors have prepared the annual accounts of the Company on a “going concern” basis. Fixed Deposits:

Your Company has not accepted any deposits under Section 58A of the Companies Act, 1956 during the period under review.

Particulars of Employees:

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

Industrial Relations:

The Company enjoyed cordial relations with its employees at all levels. Your Directors appreciate the support and co-operation provided by all the employees.

Listing:

Your Company''s shares continue to be listed on the SME platform of BSE Limited. The listing fee to BSE Limited for the year 2014-15 has been paid by your Company on time.

Proceeds of the Issue:

Company mobilised funds of Rs. 5,00,40,000 through IPO during the period under review, and the monies so raised have been utilized for the purpose mentioned in the prospectus i.e. for funding working capital and no material variation has occurred between the projections and actual utilisation.

E-voting:

In compliance with the provisions of Section 108 of the Act and the Rules framed there under, the Members are provided with the facility to cast their vote electronically, through the e-voting services provided by CDSL, on all the resolutions set forth in the Notice. The e-voting period commences on Monday, 22nd September, 2014 (9:00 a.m. IST) and ends on Wednesday, 24th September, 2014 (6:00 p.m. IST). During this period, Members of the Company, holding shares either in physical form or in dematerialised form, as on 29th August, 2014, may cast their vote electronically. The e-voting module shall be disabled by CDSL for voting thereafter. Once the vote on a resolution is cast by a Member, he shall not be allowed to change it subsequently. A separate communication is being sent to the Members to avail of the e-voting facility.

Acknowledgements:

Your Directors are pleased to express their gratitude for all the co-operation and assistance received from bankers, members, customers, vendors, various Government authorities and employees for their support and faith in the Company.

For and on Behalf of Board

Date: 02nd September 2014 Place: Aurangabad Sd/- RAGHAVENDRA JOSHI (Chairman)