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Directors Report of Sterling Tools Ltd.

Mar 31, 2018

Dear Members,

The Directors are pleased to present the 39^th Annual Report on the business and operations of your Company and Audited Financial Statements (Standalone and Consolidated) for the financial year ended March 31, 2018.

Financial Results

The Companyâs performance for the Financial Year 2017-2018 vis-a-vis 2016-2017 is summarized as under:

(Amount in Lacs)

Particulars	Standalone		Consolidated
	2017-2018	2016-2017	2017-2018	2016-2017
Profit Before Tax	7492.62	6037.13	7536.17	6029.21
Less: Current Tax	2645.39	2009.71	2649.87	2011.76
Deferred Tax	(18.88)	106.90	(18.88)	106.90
Profit for the year	4866.11	3920.52	4905.18	3910.55
Add: Other Comprehensive Income	(46.12)	(9.40)	(46.12)	(9.40)
Total Comprehensive Income for the year	4819.99	3911.12	4859.06	3901.15
Appropriations: Interim Dividend	720.48	684.46	720.48	684.46
Tax on Interim Dividend	146.67	139.34	146.67	139.34
Transfer to General Reserve	0.00	391.00	0.00	391.00
Balance Carried to Balance Sheet	3952.84	2696.32	3991.91	2686.35

Companyâs performance and Future outlook

The highlights of the Companyâs performance (Standalone) during the Financial Year 2017-18 are as under:

- Profit before Tax increased by 24.11% at Rs. 7492.62 Lacs.

- Total Comprehensive Income increased by 23.24% to Rs. 4819.99 Lacs.

- Cash Profit increased by 18.00% to Rs. 6578.84 Lacs.

The Company is going to set up its fourth manufacturing facility at Vemagal Industrial Area, Kolar district, Bengaluru. Land admeasuring 10 acres for said purpose has already been taken on long term lease from Karnataka Industrial Authority Development Board (KIADB). The said facility would be operational in April, 2019 with its first phase annual capacity of 6000 MT by investing Rs. 90 Crores as initial capex including the cost of land.

The Management looks the future with optimism and hopes to do better in year to come.

Dividend

Considering the good financial performance of the Company, the Directors had, in their meetings held on 7^th September, 2017 and 13^th February, 2018 recommended 50% dividend each time, thus aggregating to 100% interim dividend for financial year 2017-2018 against 100% dividend in previous financial year. These two interim dividends have already been paid and taking note of this payout, the Directors have not recommended any final dividend for financial year 2017-2018 and the interim dividends already declared and paid be considered as final dividend for the financial year 2017-2018.

The total outflows on account of said Interim Dividends (including Dividend Distribution Tax, Surcharge and Education Cess) amount to Rs. 867.15 Lacs.

Transfer to General Reserve

The Company has not transferred any funds to General Reserves out of the amount available for appropriation.

Deposits

The Company has not accepted any deposits during the year which come under the purview of Section 73 of the Companies Act, 2013 and as such no amount on account of principal or interest was outstanding as on the date of Balance Sheet.

Depository System

As the members are aware, the Companyâ shares are compulsorily tradable in electronic form. As on March 31, 2018, 99.65% of the Companyâs total paid-up Capital representing 35899614 shares are in dematerialized form. In view of numerous advantages offered by the Depository System, members holding shares in physical mode are advised to avail of the facility of dematerialization from either of the Depositories.

Capital Structure and Listing

As on 31^st March, 2018, the Company has Authorised Share Capital of Rs.10,00,00,000/-and Paid Up Share Capital of Rs. 7,20,48,422/-. During the year, Company has allotted 1801211 Equity Shares to Meidoh Co. Ltd. Japan on Preferential Basis on 20^th June, 2017. The equity shares of the Company are listed with Bombay Stock Exchange Limited and National Stock Exchange of India Limited. There are no arrears on account of payment of listing fees to the said Stock Exchanges.

The Promoters and Persons acting in concert with them hold 65.32% share Capital of the Company as on 31^st March, 2018.

Subsidiaries, Joint Venture and Associate Companies

As on date, the Company has one Joint Venture Company named Sterling Fabory India Pvt. Ltd.- a Joint Venture on 50:50 basis with a Netherland based Company named Fabory Masters in Fasteners Group B.V.. There has been no change in the nature of business carried out by said Joint Venture Company during Financial Year 2017-2018.

Further the Company has acquired 100% shareholding of Haryana Ispat Pvt. Ltd. on 25^th November, 2016. Hence the said Company is a wholly owned Subsidiary of our company w.e.f. 25^th November, 2016.

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, a Statement containing the salient features of financial statements of both the Companies Joint Venture Company named Sterling Fabory India Pvt. Ltd. and Wholly Owned Subsidiary Company named Haryana Ispat Pvt. Ltd. by way of Form AOC-1 is attached to the Accounts as an Annexure -I.

In accordance with third proviso of Section 136(1) of the Companies Act, 2013, the Annual Report of the Company, containing therein its standalone and the consolidated financial statements has been placed on the website of the Company, www.stlfasteners.com/new/news.asp.

Number of meetings of the Board and attendance of the Directors

6 (Six) board meetings were conducted during the year in respect of which proper notices were given and the proceedings were properly recorded. For details of the meetings of the Board and attendance of the Directors, please refer Page No. 41 of Corporate Governance Report attached to this Annual Report.

Disclosure under Secretarial Standard-1 (SS-1):

Adherence by a Company to the Secretarial Standards is mandatory as per Sub-section (10) of Section 118 of Companies Act, 2013. As per the disclosure requirement of para (9) of Secretarial Standard-1 (SS-1), the Company complies with the provisions of applicable Secretarial Standards in respect of the convening of the Board & General Meetings.

Extract of Annual Return

As provided under section 134(3)(a) and Section 92(3) of the Companies Act, 2013, the extract of Annual Return in the prescribed form MGT-9 has been given by an Annexure-II attached to this Report.

Directors and Key Managerial Personnel

Pursuant to the provisions of Section 149 of the Act, Mr. C.R. Sharma, Dr. T.N. Kapoor and Ms. Malini Sud have been appointed as Independent Directors. They have submitted a declaration that each of them meets the criteria of independence as provided in Section 149(6) of the Act and there has been no change in the circumstances which may affect their status as Independent Director during the year.

Mr. Atul Aggarwal retires by rotation and being eligible offers himself for re-appointment.

Pursuant to the provisions of Section 203 of the Act, the Key Managerial Personnel of the Company are Mr. Anil Aggarwal, Managing Director, Mr. Atul Aggarwal, Whole time Director and Chief Financial Officer of the company and Vaishali Singh, the Company Secretary. There has been no change in the key managerial personnel during the year.

Policy on Directorsâ appointment and remuneration and other details

The Companyâs policy on Directorsâ appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matters provided in Section 178(3) and Section 134(3) (e) of the Act has been disclosed in an Annexure-III attached to this Report.

Policy on Board Diversity

In accordance with the clause 49(IV) of the Listing Agreement readwith the SEBI (Listing Obligations & Disclosure Requirement) Regulation, 2015, the Nomination and Remuneration Committee (NRC) has framed and adopted a formal policy on Board diversity which sets out a framework to promote diversity on Companyâs Board of Directors. The Company recognizes the importance and benefits of having the diversified Board to enhance quality of its performance. The policy inter-alia specifies optimum combination of Executive Directors, Non-Executive Directors and Independent Directors, the recommendatory requirement for each of the Directors to possess functional diversity and role of NRC to ensure that the same policy is considered while recommending the appointment of new Directors on the Board of company.

Particulars of Loans, Guarantees or Investments under section 186

The Company has not provided any loans or Guarantees under Section 186 during the year. It has invested Rs. 6,88,25,000/-(Rupees Six Crores Eighty Eight Lacs Twenty Five Thousand only) in Equity share Capital of Sterling Fabory India Private Limited, a Joint venture Company and Rs. 11,98,50,000/- (Rupees Eleven Crores Ninety-Eight Lacs Fifty Thousand Only) in Equity Share Capital of Haryana Ispat Private Limited, a Subsidiary Company till 31^st March 2018.

Transactions with Related Parties

All contracts/arrangements/transactions entered by the Company during the financial year with related parties were in its ordinary course of business and on an armsâ length basis.

During the year, the Company had not entered into any contract/arrangement/transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.

Information on transactions with Related Parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure-IV in Form AOC-2 and the same forms part of this report.

Audit Committee, Meetings of the Committee & Attendance of Members:

The Committeeâs composition meets with requirements of Section 177 of the Companies Act, 2013 and Regulation 18 of the Listing Regulations, 2015. Members of the Audit Committee possess financial / accounting expertise / exposure. The purpose of this Committee is to ensure the objectivity, credibility and correctness of the Companyâs financial reporting and disclosures process, internal controls, risk management policies and processes, tax policies, compliance and legal requirements and associated matters.

At present, the Audit Committee comprises of following Directors as members having wide experience and knowledge of Corporate Affairs, Income Tax & Finance.

- Shri. C. R. Sharma - Chairman(Non Executive Independent Director)

- Dr. T. N. Kapoor - Member(Non Executive Independent Director)

- Ms. Malini Sud - Member(Non Executive Independent Director)

- Shri Anil Aggarwal - Member(Managing Director)

All the recommendations made by the Audit committee during the year had been accepted by the Board.

Five meetings were conducted during the year in respect of which proper notices were given and the proceedings were properly recorded. For details of the meetings of the Audit Committee and attendance of the Members, please refer Page No. 44 of Corporate Governance Report attached to this Annual Report.

Board Evaluation

The Board of Directors and Nomination and Remuneration Committee reviewed the performance of the Board after seeking inputs from all the directors on the basis of the criteria such as the board composition and structure, effectiveness of board processes, information and functioning etc.

The performance of the Committees was evaluated by the board after seeking inputs from the Committee members on the basis of the criteria such as composition of committees, effectiveness of committee meetings etc.

The Board of Directors and Nomination and Remuneration Committee reviewed the performance of the individual directors on the basis of the criteria such as contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings etc.

In addition to above said, Chairman of the Company was also evaluated on the key aspects of his role.

In a separate meeting of independent directors held on 25th December, 2017, performance of nonindependent directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of Executive and Non-executive directors.

Material changes and commitments

In terms of Section 134(3)(l) of the Companies Act, 2013, no material changes and commitments which could affect the Companyâs financial position have occurred between the end of the financial year of the Company and date of this report.

Credit Rating

The Companyâ domestic credit rating has been improved from A to of AA- by ICRA on 25^th July, 2018 which reflects the Companyâs financial discipline and prudence.

Corporate Social Responsibility

Composition of the Corporate Social Responsibility Committee has been disclosed in the Corporate Governance Report, attached to this report. The brief outline of the Corporate Social Responsibility (CSR) Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure-V of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. The policy on CSR is available on the website of the Company, (www.stlfasteners.com/new/news.asp).

Particulars of Employees

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules are provided in the Annual Report, which forms part of this Report.

Disclosures relating 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 in the Annual Report, which forms part of this Report.

Having regard to the provisions of the first proviso to Section 136(1) of the Act and as advised, the Annual Report excluding the aforesaid information is being sent to the members of the Company. The said information is available for inspection on all working days, during business hours, at the Registered Office of the Company. Any member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request.

The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been given by way of Annexure-VI to this Report.

Capital Expenditure

As on March 31, 2018, the Gross Fixed Assets stood at Rs. 26934.74 Lacs and Net Fixed Assets stood at Rs. 14861.74 Lacs. Additions during the year amounted to Rs. 1772.34 Lacs.

Conservation of energy, technology absorption and foreign exchange earnings and outgo

Information pursuant to the provisions of Section 134(3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 relating to conservation of energy, technology absorption & foreign exchange earnings and outgo is given by way of Annexure-VII to this Report.

Transfer of amounts to Investor Education and Protection Fund

Pursuant to the provisions of Section 125 of the Companies Act, 2013, relevant amounts which remained unpaid or unclaimed for a period of seven years have been transferred by the Company, from time to time on due dates, to the Investor Education and Protection Fund. Pursuant to the provisions of Investor Education and Protection Fund (Accounting, Audit, Transfer & Refund) Rules, 2016, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on 28^th September, 2017 (date of last Annual General Meeting) on the Ministry of Corporate Affairsâ website.

Corporate Governance and Management Discussion & Analysis Report

A separate section on corporate governance practices followed by the Company, together with a certificate from the auditors confirming its compliance, forms a part of this Annual Report, as per SEBI Regulations. Further, as per Regulation 34 read with Schedule V of the Listing Regulations, a Management Discussion and Analysis report is annexed to this report.

Directorâs Responsibility Statement

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

(i) in the preparation of the accounts for the Financial Year ended 31^st March, 2018, the applicable accounting standards have been followed and there are no material departures.

(ii) the Directors have selected accounting policies in consultation with Statutory Auditors and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the financial year under review.

(iii) the directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013. The directors have confirmed that there are adequate control & systems for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(iv) the Directors have prepared the accounts for the Financial Year ended 31^st March, 2018 on a âgoing concernâ basis.

(v) the directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and are operating effectively.

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

Industrial Relations

During the year under review, harmonious industrial relations were maintained in your Company.

Statutory Disclosures

Your Directors have made necessary disclosures, as required under various provisions of the Companies Act, 2013 and under SEBI Listing Regulations.

Statutory Auditors

I) Appointment

M/s Walker Chandiok & Co., LLP were appointed as Statuary Auditors of the Company for a term of 5 years at the Annual General Meeting held on 28^th September, 2017. They have confirmed that they are not disqualified from continuing as Auditors of the Company from the conclusion of forthcoming Annual General Meeting of the Company until the conclusion of the 43^rd Annual General Meeting of the Company. Further consequent to amendment in Section 139 of Companies Act, 2013 vide Notification No. S.O. 1833(E) dated 7^th May 2018, ratification of appointment of Statutory Auditor in every Annual General Meeting is no longer required.

II) Report

The Auditorsâ Report and Notes on Accounts for the financial year 2017-2018 are self-explanatory and therefore do not call for any further comments. The Auditorsâ Report doesnât contain any qualification, reservation, adverse remark or disclaimer. During the year under review, the auditors has not reported to the Board, under sub-section (12) of section 143 of the Companies Act, 2013 any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in the Boardâs report.

Secretarial Auditorsâ report

M/s Santosh Kumar Pradhan, Company Secretaries was appointed as the Secretarial Auditor of the Company for the Financial Year 2017-2018, who has conducted the Secretarial Audit of the Company for the year 2017-2018. The Secretarial Auditorsâ Report doesnât contain any qualification, reservation or adverse remarks. The said Secretarial Audit Report is annexed as Annexure-VIII to this Report.

Cost Auditors

The Company has appointed M/s Jitender, Navneet & Co., the Cost Auditors to conduct the cost audit of the Companyâ cost records for financial year 2018-2019.

Internal Financial Control Systems and their adequacy

In order to ensure that the policies and procedures adopted by STL for conducting its business orderly and efficiently, STL is in process of aligning its internal financial control systems on lines of globally accepted risk based framework.

STLâs existing internal financial control systems are adequate for the nature of its business and the size of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable statues, safeguarding assets from unauthorised use, executing transactions with proper authorisation and ensuring compliance of corporate policies.

In the beginning of the year, the scope of audit exercise and the key business processes and selected risk areas to be audited are decided in consultation with the Audit Committee. The Internal Audit is carried out by a firm of external Chartered accountants and covers all departments. All significant audit observations and follow up actions thereon are reported to the Audit Committee.

Safety, Health and Environment (SHE) Measures

Protection of environment is the prime concern of your Company. Your Company complies with the relevant laws and regulations as well as take any additional measures considered necessary to prevent pollution, maximize recycle, reduce waste, discharges and emissions. Company Conserve natural resources by their responsible and efficient use in all its operations and plant trees.

Quality Management System

Sterling Tools Limited has three manufacturing Units, Wire Processing Unit and two fastener manufacturing plants. All the Units are certified to ISO 9001 standard.

Both the Fastener manufacturing units are certified to the following standards:

- TS16949

- ISO 14001

- OSHAS 18001

STL laboratory at DLF plant is certified to ISO 17025 for Chemical Testing, Mechanical Testing and Instrument Calibration. STL Tech Centre is also certified for Mechanical and Special testing as per ISO 17025

Cash Flow Analysis

In compliance with the provisions of Regulation 34 of the Listing Regulations, 2015, the Cash Flow Statement for the year ended 31^st March, 2018 is annexed hereto.

Sexual Harassment

The Company has Constituted an Internal Complaint Committee as required under Section-4 of the Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules made thereunder.

During the year under review, no complaint was reported.

Significant and Material Orders passed by the Regulators or Courts

The Company has not received any significant order, demand or notice from any Regulatory Authority, Courts or tribunals impacting the going concern status and operations of the Company in future.

Risk Management

The Company has a risk management policy, the objective of which is to lay down a structured framework of identifying potential threats to the organisation on a regular basis, assessing their occurrence and develop a plan to mitigate the impact of such risk on the Company to the extent possible. The policy recognizes that all the risks canât be eliminated but these could be controlled or minimized through effective mitigation measures and by effective internal controls.

Vigil Mechanism/Whistle Blower Policy

Pursuant to the provisions of Section 177(9) of the Act read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the SEBI Listing Regulations, the Company has adopted a policy on Vigil Mechanism for directors and employees to report their genuine concerns or grievance to the Vigilance Officer. The policy is available on the Companyâ website www.stlfasteners.com.

Consolidated Financial Statements

Your Directors have pleasure in enclosing the Consolidated Financial Statements in addition to the standalone financial statements pursuant to Section 129(3) of the Companies Act, 2013 (Act) and SEBI Listing Regulations and prepared in accordance with the Accounting Standards prescribed by the Institute of Chartered Accountants of India, in this regard. Highlights of Performance and other details of Subsidiaries and Joint Venture Companies during the period are given below:

I. Haryana Ispat Pvt. Ltd. - Subsidiary Company:

The Subsidiary Company became a subsidiary on 25^th November, 2016. During the year under review, the revenue of the Subsidiary Company is Rs. 19.41 Lacs. Further, the income of the Subsidiary for the year is Rs. 13.23 Lacs.

II. Sterling Fabory India Pvt Ltd- Joint Venture Company:

The Joint Venture Company was incorporated on 9^th March, 2010 as a JV. During the year under review, the revenue of the JV Company is Rs. 1228.54 lacs and the profit of the Company is Rs. 51.71 lacs

Human Resources

The Company believes and considers its human resources as the most valuable asset. Hence continues its focus on their retention through employee engagement initiatives and provides a holistic environment where employees get opportunities to realize their potential. The policy of the Company not only meets all applicable statutory requirements but also focuses on motivation, learning and training of employees for the overall development of human resources.

The directors are pleased to record their appreciation for the services rendered by the employees and staff at all levels.

Weblink to Important documents/information

The Company has hosted certain policies/documents/information including inter alia, Policy for determining âPolicy on Related Party Transactions, Familiarisation programmes for Independent Directors etc. as per the requirement of law or otherwise on following link: www.stlfasteners.com/

Acknowledgements

Your Directors would like to express their appreciation for the assistance and co-operation received from the Banks, Government Authorities, Customers, Vendors and Members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by all Companyâ personnel.

Your Directors look forward to their continued support.

For and on behalf of the Board

M. L. Aggarwal

Date: 11^th August, 2018 Chairman

Place: Faridabad DIN No. 00027380

Mar 31, 2017

Boardâs Report

Dear Members,

The Directors are pleased to present the 38th Annual Report on the business and operations of your Company and Audited Financial Statements for the financial year ended March 31, 2017.

Financial Results

The Company''s performance for the Financial Year 2016-2017 vis-a-vis 2015-2016 is summarized as under:

(Amount in Lacs)

Particulars	Standalone		Consolidated*
Particulars	2016-2017	2015-2016	2016-2017	2015-2016
Revenue from Operations (Net)	37392.23	36937.47	37777.08	37224.75
Profit before interest, depreciation and tax	8030.15	6248.50	8025.95	6208.42
Interest	507.54	561.76	507.54	561.76
Depreciation	1533.44	1340.58	1538.04	1346.82
Profit Before Tax (PBT)	5989.17	4346.16	5980.37	4299.84
Provision for Tax	2103.49	1504.63	2104.15	1495.37
Profit After Tax (PAT)	3885.68	2841.53	3876.22	2804.47
Appropriations: Interim Dividend Tax on Interim Dividend Transfer to General Reserve Balance Carried to Balance Sheet	684.46 139.34 391.00 12580.38	1026.69 209.01 284.00 9909.51	684.46 139.34 391.00 12144.63	1026.69 209.01 284.00 9483.21

Companyâs performance and Future outlook

During the year under review, your Company has taken measures to enhance operational efficiencies by changing Product Mix, improvements at shop floor and reducing rejections.

The highlights of the Company''s performance during the Financial Year 2016-17 are as under:

- Revenue from operations increased by 1.23% to Rs. 37392.23 Lacs.

- Exports decreased by 20.41% to Rs. 2654.14 Lacs.

- PBDIT increased by 28.51% at Rs. 8030.15 Lacs.

- Profit before Tax increased by 37.80% at Rs. 5989.17 Lacs.

- Net Profit increased by 36.75% to Rs. 3885.68 Lacs.

The Company has plans to expand its operations by setting up fourth manufacturing facility either at Ahmadabad or in South vicinity which will boost up the growth rate of the Company. The Company has already signed a Business Collaboration Agreement with a Japan based Company named Meidoh Co. Ltd. to upgrade the existing systems and processes for catering the Japanese Four Wheeler Passenger Vehicle Companies in India. The Management looks the future with optimism and hopes to do better in year to come.

Dividend

Considering the good financial performance of the Company, the Directors had, in their meetings held on 8th August, 2016 and 11th February, 2017 recommended 50% dividend each time, thus aggregating to 100% interim dividend for financial year 2016-2017 against 150% dividend in previous financial year. This interim dividend has already been paid and taking note of this payout, the Directors have not recommended any final dividend for financial year 2016-2017 and the interim dividends already declared and paid be considered as final dividend for the financial year 2016-2017.

The total outflows on account of said Interim Dividends (including Dividend Distribution Tax, Surcharge and Education Cess) amount to Rs. 823.80 Lacs.

Transfer to General Reserve

The Company proposes to transfer Rs. 391.00 Lacs to General Reserves out of the amount available for appropriation.

Deposits

Depository System

As the members are aware, the Company'' shares are compulsorily tradable in electronic form. As on March 31, 2017, 99.10% of the Company''s total paid-up Capital representing 33915360 shares are in dematerialized form. In view of numerous advantages offered by the Depository System, members holding shares in physical mode are advised to avail of the facility of dematerialization from either of the Depositories.

Capital Structure and Listing

As on 31^st March, 2017, the Company has Authorized Share Capital of Rs.10,00,00,000/-and Paid Up Share Capital of Rs. 6,84,46,000/-. During the year company Sub-divided the face value of Rs. 10/- for 1 (one) Equity Share into face value Rs. 2/- each for 5 (Five) Equity Shares through the ordinary resolution passed through Postal ballot w.e.f., 11^th January, 2017. The equity shares of the Company are listed with Bombay Stock Exchange Limited and National Stock Exchange of India Limited. There are no arrears on account of payment of listing fees to the said Stock Exchanges.

The Promoters and Persons acting in concert with them hold 70.15% share Capital of the Company as on 31^st March, 2017.

Subsidiaries, Joint Venture and Associate Companies

Further the Company has acquired 100% shareholding of Haryana Ispat Pvt. Ltd. on 25^th November, 2016. Hence the said Company is a wholly owned Subsidiary of our company w.e.f. 25^th November, 2016.

Number of meetings of the Board and attendance of the Directors

4 (four) board meetings were conducted during the year in respect of which proper notices were given and the proceedings were properly recorded. For details of the meetings of the Board and attendance of the Directors, please refer Page No. 40 of Corporate Governance Report attached to this Annual Report.

Extract of Annual Return

As provided under section 134(3)(a) and Section 92(3) of the Companies Act, 2013, the extract of Annual Return in the prescribed form MGT-9 has been given by an Annexure-II attached to this Report.

Directors and Key Managerial Personnel

Pursuant to the provisions of Section 149 of the Act, Sh. C.R. Sharma, Dr. T.N. Kapoor and Ms. Malini Sud have been appointed as Independent Directors. They have submitted a declaration that each of them meets the criteria of independence as provided in Section 149(6) of the Act and there has been no change in the circumstances which may affect their status as Independent Director during the year.

Mr. Anil Aggarwal retires by rotation and being eligible offers himself for re-appointment.

Policy on Directorsâ appointment and remuneration and other details

The Company''s policy on Directors'' appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matters provided in Section 178(3) and Section 134(3) (e) of the Act has been disclosed in an Annexure-III attached to this Report.

Policy on Board Diversity

In accordance with the clause 49(IV) of the Listing Agreement readwith the SEBI (Listing Obligations & Disclosure Requirement) Regulation, 2015, the Nomination and Remuneration Committee (NRC) has framed and adopted a formal policy on Board diversity which sets out a framework to promote diversity on Company''s Board of Directors. The Company recognizes the importance and benefits of having the diverse Board to enhance quality of its performance. The policy inter-alia specifies optimum combination of Executive Directors, Non Executive Directors and Independent Directors, the recommendatory requirement for each of the Directors to possess functional diversity and role of NRC to ensure that the same policy is considered while recommending the appointment of new Directors on the Board of company.

Particulars of Loans, Guarantees or Investments under section 186

The Company has not provided any loans or Guarantees under Section 186 during the year. It has invested Rs.5,88,25,000/-(Rupees Five Crores Eighty Eight Lacs Twenty Five Thousand only) in Equity share Capital of Sterling Fabory India Private Limited, a Joint venture Company and Rs. 11,98,50,000/- (Rupees Eleven Crores Ninety Eight Lacs Fifty Thousand Only) in Equity Share Capital of Haryana Ispat Private Limited, a Subsidiary Company till 31^st March 2017.

Transactions with Related Parties

Audit Committee, Meetings of the Committee & Attendance of Members:

The Committee''s composition meets with requirements of Section 177 of the Companies Act, 2013 and Regulation 18 of the Listing Regulations, 2015. Members of the Audit Committee possess financial / accounting expertise / exposure. The purpose of this Committee is to ensure the objectivity, credibility and correctness of the Company''s financial reporting and disclosures process, internal controls, risk management policies and processes, tax policies, compliance and legal requirements and associated matters.

At present, the Audit Committee comprises of following Directors as members having wide experience and knowledge of Corporate Affairs, Income Tax & Finance.

- Shri. C. R. Sharma - Chairman(Non Executive Independent Director)

- Dr. T. N. Kapoor - Member(Non Executive Independent Director)

- Ms. Malini Sud - Member(Non Executive Independent Director)

- Shri Anil Aggarwal - Member(Managing Director)

All the recommendations made by the Audit committee during the year had been accepted by the Board.

Four meetings were conducted during the year in respect of which proper notices were given and the proceedings were properly recorded. For details of the meetings of the Audit Committee and attendance of the Members, please refer Page No. 43 of Corporate Governance Report attached to this Annual Report.

Board Evaluation

The Board of Directors and Nomination and Remuneration Committee reviewed the performance of the Board after seeking inputs from all the directors on the basis of the criterial such as the board composition and structure, effectiveness of board processes, information and functioning etc.

In addition to above said, Chairman of the Company was also evaluated on the key aspects of his role.

In a separate meeting of independent directors held on 26th December, 2016, performance of no independent directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of Executive and Non-executive directors.

Material changes and commitments

In terms of Section 134(3)(l) of the Companies Act, 2013, no material changes and commitments which could affect the Company''s financial position have occurred between the end of the financial year of the Company and date of this report.

Credit Rating

The Company continues to enjoy the domestic credit rating of A from ICRA which reflects the Company''s financial discipline and prudence.

Corporate Social Responsibility

Particulars of Employees

Capital Expenditure

As on March 31, 2017, the Gross Fixed Assets (including Capital WIP) stood at Rs. 24425.85 Lacs and Net Fixed Assets stood at Rs. 14314.41 Lacs. Additions during the year amounted to Rs. 3965.48 Lacs.

Conservation of energy, technology absorption and foreign exchange earnings and outgo

Transfer of amounts to Investor Education and Protection Fund

Pursuant to the provisions of Section 125 of the Companies Act, 2013, relevant amounts which remained unpaid or unclaimed for a period of seven years have been transferred by the Company, from time to time on due dates, to the Investor Education and Protection Fund. Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on 29^th September, 2016 (date of last Annual General Meeting) on the Ministry of Corporate Affairs'' website.

Corporate Governance and Management Discussion & Analysis Report

Directorâs Responsibility Statement

Pursuant to the requirement under section 134(3) (c) of the Companies Act, 2013 with respect to Director''s Responsibility Statement, it is hereby confirmed that:

(i) in the preparation of the accounts for the Financial Year ended 31^st March, 2017, the applicable accounting standards have been followed and there are no material departures.

(iv) the Directors have prepared the accounts for the Financial Year ended 31^st March, 2017 on a âgoing concern'' basis.

(v) the directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and are operating effectively.

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

Industrial Relations

During the year under review, harmonious industrial relations were maintained in your Company.

Statutory Disclosures

Your Directors have made necessary disclosures, as required under various provisions of the Companies Act, 2013 and under SEBI Listing Regulations.

Statutory Auditors

I) Appointment

M/s. S. R. Dinodia & Co. LLP. the existing Statutory Auditors of the Company have been in office for more than 10 years and in compliance with the provisions of Section 139 of Companies Act, 2013, the Audit Committee and the Board of Directors vide their meetings held on 31^st August, 2017 recommended the appointment of M/s Walker Chandiok & Co., LLP as Statuary Auditors of the Company for a term of 5 years from the conclusion of forthcoming Annual General Meeting of the Company until the conclusion of the 43^rd Annual General Meeting of the Company.

II) Report

The Auditors'' Report and Notes on Accounts for the financial year 2016-2017 are self-explanatory and therefore do not call for any further comments.

Secretarial Auditorsâ report

M/s Santosh Kumar Pradhan, Company Secretaries was appointed as the Secretarial Auditor of the Company for the Financial Year 2016-2017, who has conducted the Secretarial Audit of the Company for the year 2016-2017. The Secretarial Auditors'' Report doesn''t contain any qualification, reservation or adverse remarks. The said Secretarial Audit Report is annexed as Annexure-VIII to this Report.

Cost Audiors

The Company appointed M/s G.T. & Co., the Cost Auditors to conduct the cost audit of the Company'' cost records for financial year 2016-2017.

Internal Financial Control Systems and their adequacy

STL''s existing internal financial control systems are adequate for the nature of its business and the size of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable statues, safeguarding assets from unauthorized use, executing transactions with proper authorization and ensuring compliance of corporate policies.

Safety, Health and Environment (SHE) Measures

Protection of environment is the prime concern of your Company. Your Company complies with the relevant laws and regulations as well as take any additional measures considered necessary to Prevent pollution, maximize recycle, reduce waste, discharges and emissions. Company Conserve natural resources by their responsible and efficient use in all its operations and plant trees.

Quality Management System

Sterling Tools Limited has three manufacturing Units, Wire Processing Unit and two fastener manufacturing plants. All the Units are certified to ISO 9001 standard.

Both the Fastener manufacturing units are certified to the following standards:

- TS16949

- ISO 14001

- OSHAS 18001

STL laboratory at DLF plant is certified to ISO 17025 for Chemical Testing, Mechanical Testing and Instrument Calibration.

Cash Flow Analysis

In compliance with the provisions of Regulation 34 of the Listing Regulations, 2015, the Cash Flow Statement for the year ended 31^st March, 2017 is annexed hereto.

Sexual Harassment

During the year under review, no complaint was reported.

Significant and Material Orders passed by the Regulators or Courts

The Company has not received any significant order, demand or notice from any Regulatory Authority, Courts or tribunals impacting the going concern status and operations of the Company in future.

Development of Risk Management Policy

The Company has a risk management policy the objective of which is to lay down a structured framework of identifying potential threats to the organization on a regular basis, assessing their occurrence and develop a plan to mitigate the impact of such risk on the Company to the extent possible. The policy recognizes that all the risks can''t be eliminated but these could be controlled or minimized through effective mitigation measures and by effective internal controls.

Vigil Mechanism/Whistle Blower Policy

Pursuant to the provisions of Section 177(9) of the Act read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the SEBI Listing Regulations, the Company has adopted a policy on Vigil Mechanism for directors and employees to report their genuine concerns or grievance to the Vigilence Officer. The policy is available on the Company'' website www.stlfasteners.com.

CONSOLIDATED FINANCIAL STATEMENTS

Human Resources

The directors are pleased to record their appreciation for the services rendered by the employees and staff at all levels.

We blink to Important documents/information

The Company has hosted certain policies/documents/information including inter alia, Policy for determining âPolicy on Related Party Transactions, Familiarization programmes for Independent Directors etc. as per the requirement of law or otherwise on following link: www.stlfasteners.com/

Acknowledgements

Your Directors look forward to their continued support.

For and on behalf of the Board

M. L. Aggarwal

Date: 31^st August, 2017 Chairman

Place: Faridabad DIN No. 00027380

Mar 31, 2016

Dear Members,

The Directors are pleased to present the 37th Annual Report on the business and operations of your Company and Audited Financial Statements for the financial year ended March 31, 2016.

Financial Results

The Company''s performance for the Financial Year 2015-2016 vis-a-vis 2014-2015 is summarized as under:

(Amount in Lacs)

Particulars	Standalone		Consolidated*
Particulars	2015-2016	2014-2015	2015-2016
Revenue from Operations (Net)	36937.47	34005.72	37224.75
Profit before interest, depreciation and tax	6248.50	4732.51	6208.42
Interest	561.76	655.44	561.76
Depreciation	1340.58	1203.13	1346.82
Profit Before Tax (PBT)	4346.16	2873.94	4299.84
Provision for Tax	1504.63	751.78	1495.37
Profit After Tax (PAT)	2841.53	2122.16	2804.47
Appropriations: Interim Dividend Proposed Dividend Tax on Interim Dividend Tax on Proposed Dividend Transfer to General Reserve Balance Carried to Balance Sheet	1026.69 209.01 284.00 9909.51	342.23 58.16 212.00 8587.68	1026.69 209.01 284.00 9483.21

âConsolidated Financial Statements are applicable on Company effective from Financial Year 2015-2016.

Companyâs performance

The Company performed very well and demonstrated good performance during the Financial Year 2015-2016.

The highlights of the Company''s performance during the Financial Year 2015-16 are as under:

- Revenue from operations increased by 8.62% to Rs. 36937.47 Lacs.

- Exports decreased by 8.16% to Rs. 3334.73 Lacs.

- PBDIT increased by 32.03% at Rs. 6248.50 Lacs.

- Profit before Tax increased by 51.23% at Rs. 4346.16 Lacs.

- Net Profit increased by 33.90% to Rs. 2841.53 Lacs.

Dividend

Considering the good financial performance of the Company, the Directors had, in their meetings held on 4th August, 2015, 8th February, 2016 and 14th March, 2016 recommended 50% dividend each time, thus aggregating to 150% interim dividend for financial year 2015-2016 against 50% dividend in previous financial year. This interim dividend has already been paid and taking note of this payout, the Directors have not recommended any final dividend for financial year 20152016 and the interim dividends already declared and paid be considered as final dividend for the financial year 2015-2016.

The total outflows on account of said Interim Dividends (including Dividend Distribution Tax, Surcharge and Education Cess) amount to Rs. 1235.70 Lacs.

Transfer to General Reserve

The Company proposes to transfer Rs. 284.00 Lacs to General Reserves out of the amount available for appropriation.

Deposits

Depository System

As the members are aware, the Company'' shares are compulsorily tradable in electronic form. As on March 31, 2016, 99.06% of the Company''s total paid-up Capital representing 6780371 shares are in dematerialized form. In view of numerous advantages offered by the Depository System, members holding shares in physical mode are advised to avail of the facility of dematerialization from either of the Depositories.

Capital Structure and Listing

As on 31st March, 2016, the Company has Authorized Share Capital of Rs.10, 00, 00,000/-and Paid up Share Capital of Rs. 6, 84, 46,000/-. The equity shares of the Company are listed with Bombay Stock Exchange Limited and National Stock Exchange of India Limited. There are no arrears on account of payment of listing fees to the said Stock Exchanges.

The Promoters and Persons acting in concert with them hold 70.15% share Capital of the Company as on 31st March, 2016 as against 70.15% as on 31st March, 2015.

Performance of Joint Venture Company

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, a Statement containing the salient features of financial statements of Joint Venture Company named Sterling Fabory India Pvt. Ltd. by way of Form AOC-1 is attached to the Accounts.

Number of meetings of the Board and attendance of the Directors

5 (Five) board meetings were conducted during the year in respect of which proper notices were given and the proceedings were properly recorded. For details of the meetings of the Board and attendance of the Directors, please refer Page No. 37 of Corporate Governance Report attached to this Annual Report.

Extract of Annual Return

As provided under section 134(3)(a) and Section 92(3) of the Companies Act, 2013, the extract of Annual Return in the prescribed form MGT-9 has been given by an Annexure-II attached to this Report.

Directors and Key Managerial Personnel

Mr. Atul Aggarwal retires by rotation and being eligible offers himself for re-appointment.

Policy on Directorsâ appointment and remuneration and other details

Policy on Board Diversity

In accordance with the clause 49(IV) of the Listing Agreement read with the SEBI (Listing Obligations

6 Disclosure Requirement) Regulation, 2015, the Nomination and Remuneration Committee (NRC) has framed and adopted a formal policy on Board diversity which sets out a framework to promote diversity on Company''s Board of Directors. The Company recognizes the importance and benefits of having the diverse Board to enhance quality of its performance. The policy inter-alia specifies optimum combination of Executive Directors, Non Executive Directors and Independent Directors, the recommendatory requirement for each of the Directors to possess functional diversity and role of NRC to ensure that the same policy is considered while recommending the appointment of new Directors on the Board of company.

Particulars of Loans, Guarantees or Investments under section 186

Transactions with Related Parties

Information on transactions with Related Parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure-IV in Form AOC-2 and the same forms part of this report.

Audit Committee, Meetings of the Committee & Attendance of Members:

At present, the Audit Committee comprises of following Directors as members having wide experience and knowledge of Corporate Affairs, Income Tax & Finance.

- Shri. C. R. Sharma - Chairman (Non Executive Independent Director)

- Dr. T. N. Kapoor - Member (Non Executive Independent Director)

- Ms. Malini Sud - Member (Non Executive Independent Director)

- Shri Anil Aggarwal - Member (Managing Director)

All the recommendations made by the Audit committee during the year had been accepted by the Board.

Four meetings were conducted during the year in respect of which proper notices were given and the proceedings were properly recorded. For details of the meetings of the Audit Committee and attendance of the Members, please refer Page No. 40 of Corporate Governance Report attached to this Annual Report.

Board Evaluation

In addition to above said, Chairman of the Company was also evaluated on the key aspects of his role.

In a separate meeting of independent directors held on 29th December, 2015, performance of no independent directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of Executive and Non-executive directors.

Material changes and commitments

Credit Rating

The Company continues to enjoy the domestic credit rating of (A) from ICRA which reflects the Company''s financial discipline and prudence.

Corporate Social Responsibility

Composition of the Corporate Social Responsibility Committee has been disclosed in the Corporate Governance Report, attached to this report. The brief outline of the Corporate Social Responsibility (CSR) Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure-V of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. The policy on CSR is available on the website of the Company (www.stlfasteners.com/new/news.asp).

Particulars of Employees

Capital Expenditure

As on March 31, 2016, the Gross Fixed Assets (including Capital WIP) stood at Rs. 22631.43 Lacs and Net Fixed Assets stood at Rs. 13936.57 Lacs. Additions during the year amounted to Rs. 3748.48 Lacs.

Conservation of energy, technology absorption and foreign exchange earnings and outgo

Transfer of amounts to Investor Education and Protection Fund

Pursuant to the provisions of Section 125 of the Companies Act, 2013, relevant amounts which remained unpaid or unclaimed for a period of seven years have been transferred by the Company, from time to time on due dates, to the Investor Education and Protection Fund. Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on 29th September, 2015 (date of last Annual General Meeting) on the Ministry of Corporate Affairs'' website.

Corporate Governance and Management Discussion & Analysis Report

Directorâs Responsibility Statement

Pursuant to the requirement under section 134(3) (c) of the Companies Act, 2013 with respect to Director''s Responsibility Statement, it is hereby confirmed that:

(i) in the preparation of the accounts for the Financial Year ended 31st March, 2016, the applicable accounting standards have been followed and there are no material departures.

(iv) the Directors have prepared the accounts for the Financial Year ended 31st March, 2016 on a âgoing concern'' basis.

(v) The directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and are operating effectively.

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

Industrial Relations

During the year under review, harmonious industrial relations were maintained in your Company.

Statutory Disclosures

Your Directors have made necessary disclosures, as required under various provisions of the Companies Act, 2013 and under SEBI Listing Regulations.

Statutory Auditors

I) Appointment

M/s. S. R. Dinodia & Co. LLP. the Statutory Auditors of the Company, retire at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. M/s S. R. Dinodia & Co. LLP, have, under Section 141(3) (g) of Companies Act, 2013, furnished the certificate of their eligibility for reappointment. As recommended by the Audit Committee, your Directors propose that they may be reappointed as Auditors of the Company for a period of 1 year from the conclusion of this Annual General Meeting until the conclusion of the 38th Annual General Meeting of the Company.

II) Report

The Auditors'' Report and Notes on Accounts for the financial year 2015-2016 are self-explanatory and therefore do not call for any further comments.

Secretarial Auditorsâ report

M/s Santosh Kumar Pradhan, Company Secretaries was appointed as the Secretarial Auditor of the Company for the Financial Year 2015-2016, who has conducted the Secretarial Audit of the Company for the year 2015-2016. The Secretarial Auditors'' Report doesn''t contain any qualification, reservation or adverse remarks. The said Secretarial Audit Report is annexed as Annexure-VIII to this Report.

Cost Auditors

The Company appointed M/s G.T. & Co., the Cost Auditors to conduct the cost audit of the Company'' cost records for financial year 2015-2016.

Internal Financial Control Systems and their adequacy

Safety, Health and Environment (SHE) Measures

Protection of environment is the prime concern of your Company. Your Company complies with the relevant laws and regulations as well as take any additional measures considered necessary to Prevent pollution, maximize recycle, reduce waste, discharges and emissions. Company Conserve natural resources by their responsible and efficient use in all its operations and plant trees.

Quality Management System

Sterling Tools Limited has three manufacturing Units, Wire Processing Unit and two fastener manufacturing plants. All the Units are certified to ISO 9001 standard.

Both the Fastener manufacturing units are certified to the following standards:

- TS16949

- ISO 14001

- OSHAS 18001

STL laboratory at DLF plant is certified to ISO 17025 for Chemical Testing, Mechanical Testing and Instrument Calibration.

Cash Flow Analysis

In compliance with the provisions of Regulation 34 of the Listing Regulations, 2015, the Cash Flow Statement for the year ended 31st March, 2016 is annexed hereto.

Sexual Harassment

The Company has Constituted an Internal Complaint Committee as required under Section-4 of the Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressed) Act, 2013 and the rules made there under.

During the year under review, no complaint was reported.

Significant and Material Orders passed by the Regulators or Courts

Order passed by Central Excise and Service Tax Appellate Tribunal

The Company had filed appeals in Central Excise and Service Tax Appellate Tribunal against Department of Central Excise'' demand regarding assessable value with reference to MRP amounting to '' 189,015,254 for the period June 2006 to Dec 2008, '' 106,987,422 for the period January 2009 to October 2010, '' 3,990,394 for the period February 2010 to March 2010 and '' 5,326,546 for the period Nov 2010 to January 2011 under Central Excise Act. Based on the appeals the department has granted the Stay order No. S0/677-678/2012-EX (DB) dated 23 April 2012 against the demand of '' 189,015,254 for the period June 2006 to Dec 2008 & '' 106,987,422 for the period January 2009 to October 2010. Corresponding to these stay orders, the tribunal (CESTAT) vide section 35-C(1) of the Central Excise Act, 1944 has adjudicated and passed final Order No. A/52747-52748/2015/Ex [DB] dated 05/08/2015 in favor of the Company and accordingly, the demand of '' 189,015,254 for the period June, 2006 to December, 2008 and '' 106,987,422 for the period January, 2009 to October, 2010 stands withdrawn. However, the demand orders for the period February, 2010 to March, 2010 and November, 2010 and January, 2011 are still in the dispute till final adjudication.

Any other orders

The Company has not received any other order, demand or notice from any other Regulatory Authority.

Acknowledgements

Your Directors look forward to their continued support.

For and on behalf of the Board M. L. Aggarwal

Date: 8th August, 2016 Chairman

Place: Faridabad DIN No. 00027380

Mar 31, 2014

Dear Members,

The Directors are pleased to present the 35th Annual Report on the business and operations of your Company and Audited Accounts for the financial year ended March 31, 2014.

Financial Results

The Company''s performance for the Financial Year 2013-2014 vis-Ã -vis 2012-2013 is summarized as under:

(Rs. in Lacs) Particulars Financial Year

2013-2014 2012-2013

Revenue from Operations (Net) 30135.95 28250.59

Profit before interest, depreciation and tax 4165.22 3630.94

Interest 714.60 960.57

Depreciation 1029.84 940.76

Profit Before Tax (PBT) 2420.78 1729.61

Provision for Tax 858.36 642.09

Profit After Tax (PAT) 1562.42 1087.52

Appropriations:

Interim Dividend 342.23 342.23

Proposed Dividend - -

Tax on Interim Dividend 58.16 55.52

Tax on Proposed Dividend - -

Transfer to General Reserve 155.00 110.00

Balance Carried to Balance Sheet 7126.25 6119.22

Results of Operations

Despite operating in a volatile and uncertain economic environment, the Company demonstrated its best performance during the F.Y. 2013-14.

The highlights of the Company''s performance during the F.Y. 2013-14 are as under:

- Revenue from operations increased by 6.50% to Rs. 33513.63 Lacs

- Exports increased by 41.87% to Rs. 3458.91 Lacs.

- PBDIT increased by 14.71% at Rs. 4165.22 Lacs

- Profit before Tax increased by 39.96% at Rs. 2420.78 Lacs.

- Net Profit increased by 43.67% to Rs. 1562.42 Lacs

The significant factors which led to increased profitability are as follows:

- Reduced Raw Material Cost.

- Change in Product Mix.

- Savings on account of reduced Finance Cost.

Dividend

Keeping in view Sterling'' tradition of high regard for its shareholders, the Directors had, in their meeting held on 22nd January, 2014, recommended 50% interim dividend for financial year 2013-2014 against the same rate of dividend i.e. 50% in previous financial year. This interim dividend has already been paid and taking note of this payout, the Directors have not recommended any final dividend for financial year 2013-2014 and the interim dividend already declared and paid be considered as final dividend for the financial year 2013-2014.

The said dividend payout for the year under review has been formulated in accordance with shareholders'' aspirations and the Company''s policy to pay sustainable dividend linked to long term growth objectives of the Company to be met by internal cash accruals.

Transfer to General Reserve

Out of the profits of the Company, a sum of Rs. 155.00 Lacs has been transferred to General Reserves during the year and total General Reserves of the Company are Rs. 1899.46 Lacs as on 31st March, 2014.

Deposits

The Company has not accepted any deposits during the year which come under the purview of Section 73 of the Companies Act, 2013 and as such no amount on account of principal or interest was outstanding as on the date of Balance Sheet.

Depository System

As the members are aware, the Company'' shares are compulsorily tradable in electronic form. As on March 31, 2014, 98.99% of the Company''s total paid-up Capital representing 6775271 shares are in dematerialized form. In view of numerous advantages offered by the Depository System, members holding shares in physical mode are advised to avail of the facility of dematerialization from either of the Depositories.

Capital Structure and Listing

As on 31st March, 2014, the Company has Authorised Share Capital of Rs.10,00,00,000/-and Paid Up Share Capital of Rs. 6,84,46,000/-. The equity shares of the Company are listed with Bombay Stock Exchange Limited and National Stock Exchange of India Limited. There are no arrears on account of payment of listing fees to the said Stock Exchanges.

The Promoters and Persons acting in concert with them hold 70.05% share Capital of the Company as on 31st March, 2014 as against 69.96% as on 31st March, 2013.

Financial Performance of Joint Venture Company

Your Company has invested Rs. 4,75,75,000/-(Rupees Four Crores Seventy Five Lacs Seventy Five Thousand only) in Equity share Capital of Sterling Fabory India Private Limited, a Joint venture Company till 31st March 2014.

The Joint Venture Company made Gross Sales of Rs. 608.38 Lacs during the financial year 2013-2014. The said Joint Venture Company is involved in trading business of supplying fasteners in India and has started its operations in financial year 2010-2011. It is expected that the said Joint Venture Company will achieve its Break even in financial year 2015-2016.

Credit Rating

The Company continues to enjoy the domestic credit rating of (A-) from CRISIL which reflect the Company''s financial discipline and prudence.

Corporate Social Responsibility Committee

As the provisions of Corporate Social Responsibility(CSR) as prescribed under section 135 of the Companies Act, 2013 are applicable to the Company, your directors have constituted the Corporate Social Responsibility Committee (CSR

Committee) in their meeting held on 30th May, 2014 comprising Shri Anil Aggarwal as the Chairman, Shri Atul Aggarwal and Shri C.R. Sharma as members.

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

Particulars of Employees

As required by Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, a statement on information relating to employees has been given by way of Annexure-I to this Report.

Capital Expenditure

As on March 31, 2014, the Gross Fixed Assets (including Capital WIP) stood at Rs. 18513.74 Lacs and Net Fixed Assets stood at Rs. 11222.10 Lacs. Additions during the year amounted to Rs. 1587.61 Lacs.

Conservation of energy, technology absorption and foreign exchange earnings and outgo

Information pursuant to the provisions of Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, relating to conservation of energy, technology absorption & foreign exchange earnings and outgo are given by way of Annexure-II to this Report.

Transfer of Amounts to Investor Education and Protection Fund

Pursuant to the provisions of Section 205A(5) and 205C of the Companies Act, 1956, relevant amounts which remained unpaid or unclaimed for a period of seven years have been transferred by the Company, from to time to time on due dates, to the Investor Education and Protection Fund. Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on July 08, 2013 (date of last Annual General Meeting) on the Ministry of Corporate Affairs'' website (www.iepf.gov.in).

Corporate Governance

The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements set out by SEBI. The Company has also implemented several best corporate governance practices. The Report on corporate governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report.

The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance as stipulated under the aforesaid Clause 49, is attached to the Report on corporate governance by way of Annexure-III.

Your Company has made all the information, required by Investors, available on the Company''s Corporate Website www.stlfasteners.com.

Management discussion & Analysis

Management Discussion and Analysis Report covering issues relating to Industry structure, Opportunities, Challenges, Outlook and Performance etc. has been given separately and form part of this Annual Report as ANNEXURE-IV.

Director''s Responsibility Statement

Pursuant to the requirement under section 217(2AA) of the Companies (Amendment) Act, 2000, with respect to Director''s Responsibility Statement, it is hereby confirmed that:

(i) in the preparation of the accounts for the Financial Year ended 31st March, 2014, the applicable accounting standards have been followed and there are no material departures;

(ii) the Directors have selected accounting policies in consultation with Statutory Auditors and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the financial year under review;

(iii) the directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956. The directors have confirmed that there are adequate control & systems for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) the Directors have prepared the accounts for the Financial Year ended 31st March, 2014 on a ''going concern'' basis.

Industrial Relations

During the year under review, harmonious industrial relations were maintained in your Company.

Statutory Disclosures

Your Directors have made necessary disclosures, as required under various provisions of the Act and Clause 49 of the Listing Agreement.

Material Changes and Commitments

There were no material changes and commitments, affecting the financial position of the Company that have occurred between the end of the financial year of the Company and the date of signing of this report.

Directors

In terms of Article 89 of the Articles of Association and Sections 152 of the Companies Act, 2013, Shri Atul Aggarwal retires by rotation in the forthcoming Annual General Meeting and being eligible offer himself for re-appointment.

Further, the Board of Directors has recommended the appointment of Dr. T.N. Kapoor and Shri C.R. Sharma as Independent Directors for a period of 5 years w.e.f. 1st April, 2014.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Companies Act, 2013 and under Clause 49 of the Listing Agreement with the Stock Exchanges.

Further Shri K.R. Gupta acting as Independent Director of our Company since 2001 has resigned on 22nd May, 2014 for health reasons. The Board of Directors has accepted his resignation vide its meeting held on 30th May, 2014 and placed on record the great contribution that he had made consistently to the deliberations of the Board. The Company had the benefit of his valuable advice during the long period of association with the Company.

Statutory Auditors

I) Appointment

M/s. S. R. Dinodia & Co. LLP. the Statutory Auditors of the Company, retire at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. M/s S. R. Dinodia & Co. LLP. have, under Section 141(3)(g) of Companies Act, 2013, furnished the certificate of their eligibility for reappointment. As recommended by the Audit Committee, your Directors propose that they may be reappointed as Auditors of the Company from the conclusion of this Annual General Meeting until the conclusion of the next Annual General Meeting of the Company.

II) Report

The Auditors'' Report and Notes on Accounts for the financial year 2013-2014 are self explanatory and therefore do not call for any further comments.

Cost Auditors

The Company appointed M/s G.T. & Co., the Cost Auditors to conduct the cost audit of the Company'' cost records for financial year 2013-2014.

The Audit Committee vide their meeting held on 30th May, 2014 has recommended the re-appointment of M/s G.T. & Co. for the financial year 2014-2015.

Internal Control System

Your Company has instituted internal control systems which are adequate for the nature of its business and the size of its operations. In the beginning of the year, the scope of audit exercise and the key business processes and selected risk areas to be audited are decided in consultation with the Audit Committee. The Internal Audit is carried out by a firm of external Chartered accountants and covers all departments. All significant audit observations and follow up actions thereon are reported to the Audit Committee.

Safety, Health and Environment (SHE) Measures

Protection of environment is the prime concern of your company. Your company complies with the relevant laws and regulations as well as take any additional measures considered necessary to Prevent pollution, maximize recycle, reduce waste, discharges and emissions. Company Conserve natural resources by their responsible and efficient use in all our operations and plant trees

Quality Management System

Sterling Tools Limited has three units- Wire drawing unit which supplies Raw Material is certified for ISO -9001:2008.

Manufacturing units at Faridabad and Prithla are certified for TS-16949:2009. Our Plant at Prithla is certified for AS 9100 B.

Laboratory at Faridabad is NABL accredited and aligned to ISO -17025:2005. Faridabad plant is certified under Environment Management systems ISO -14001:2004.

Subsidiaries

Your Company does not have any subsidiary Company.

Cash Flow Analysis

In compliance with the provisions of Clause 32 of the Listing Agreement, the Cash Flow Statement for the year ended 31- 03-2014 is annexed hereto.

Acknowledgements

Your Directors would like to express their appreciation for the assistance and co-operation received from the Banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the Company''s executives, staff and workers.

Your Directors look forward to their continued support.

For and on behalf of the Board

Date: 30th May, 2014 M. L. Aggarwal

Place: Faridabad Chairman

DIN No. 00027380

Mar 31, 2013

Dear Members,

The Directors are pleased to present the 34th Annual Report on the business and operations of your Company and Audited Accounts for the financial year ended March 31, 2013.

Financial Results

The Company''s performance for the Financial Year 2012-2013 vis-a-vis 2011-2012 is summarized as under:

(Rs. in Lacs) Particulars Financial Year 2012-2013 2011-2012

Revenue from Operations (Net) 28250.59 29503.74

Profit before interest, depreciation and tax 3630.94 3766.41

Interest 960.57 939.71

Depreciation 940.76 795.11

Profit Before Tax (PBT) 1729.61 2031.57

Provision for Tax 642.09 555.56

"Profit After Tax (PAT) 1087.52 1476.01

Appropriations:

Interim Dividend 342.23

Proposed Dividend 342.23

Tax on Interim Dividend 55.52

Tax on Proposed Dividend 55.52

Transfer to General Reserve 110.00 150.00

Balance Carried to Balance Sheet 6117.68 5539.45

Review of Operations

During the Financial Year there has been a slight fall in Revenue from Operations as well as profit after tax. The significant reasons for decreased profitability are as follows:

a) Increased cost of power because of increase in power tariff & cost of diesel.

b) Packing and Freight cost increased due to inflation.

c) Fixed cost like salaries and wages increased even though revenue from operations has slightly reduced.

d) Increased Depreciation & amortization even though the level of operation has reduced.

Dividend

Keeping in view Sterling'' tradition of high regard for its shareholders, the Directors had, in their meeting held on 18th February, 2013, recommended 50% interim dividend for financial year 2012-2013 against the same rate of dividend i.e. 50% in previous financial year. This interim dividend has already been paid and taking note of this payout, the Directors have not recommended any final dividend for financial year 2012-2013 and the interim dividend already declared and paid be considered as final dividend for the financial year 2012-2013.

Transfer to General Reserve

Out of the profits of the Company, a sum of Rs. 110 Lacs has been transferred to General Reserve during the year and total Reserves and surplus of the Company are Rs. 8211.05 Lacs as on 31st March, 2013.

Deposits

The Company has not accepted any deposits during the year which come under the purview of Section 58A of the Companies Act, 1956 and as such no amount on account of principal or interest was outstanding as on the date of Balance Sheet.

Depository System

As the members are aware, the Company'' shares are compulsorily tradable in electronic form. As on March 31, 2013, 98.98% of the Company''s total paid-up Capital representing 6774761 shares are in dematerialized form. In view of numerous advantages offered by the Depository System, members holding shares in physical mode are advised to avail of the facility of dematerializatipn from either of the Depositories.

Capital Structure and Listing

As on 31st March, 2013, the Company has Authorised Share Capital of Rs.10,00,00,000/-and Paid Up Share Capital of Rs. 6,84,46,000/-. The equity shares of the Company are listed with Bombay Stock Exchange Limited and National Stock Exchange of India Limited. There are no arrears on account of payment of listing fees to the said Stock Exchanges.

The Promoters and Persons acting in concert with them hold 69.96% share Capital of the Company as on 31st March, 2013 as against 69.56% as on 31st March, 2012.

Financial Performance of Joint Venture Company

Your Company has invested Rs. 3,75,00,000/-(Rupees Three Crores Seventy Five Lacs only) in Equity share Capital of Sterling Fabory India Private Limited, a Joint venture Company till 31st March 2013.

The Joint Venture Company made Sales of Rs. 368.68 Lacs during the Financial Year 2012-2013.

Particulars of Employees

As required by Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, a statement on information relating to employees has been given by way of Annexure-I to this Report.

Capital Expenditure

As on March 31, 2013, the Gross Fixed Assets stood at Rs. 17047.80 Lacs and Net Fixed Assets stood at Rs. 10678.77 Lacs. Additions during the year amounted to Rs. 1548.88 Lacs.

Conservation of energy, technology absorption and foreign exchange earnings and outgo

Information pursuant to the provisions of Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, relating to conservation of energy, technology absorption & foreign exchange earnings and outgo are given by way of Annexure-ll to this Report.

Corporate Governance

Your Company has complied with the mandatory provisions of Clause 49 of the Listing Agreement, relating to Corporate Governance. Your Company believes that sound Corporate practices based on openness, credibility and accountability are essential for its long term success. These practices will ensure the Company, having regard to competitive exigencies, conduct its affairs in such a way that would build the confidence of its various stakeholders in it, and it''s Board''s integrity.

A detailed report on Corporate Governance pursuant to the provisions of Clause 49 of Listing Agreement supported by a Certificate given by the Statutory Auditors of the Company confirming compliance of conditions, form part of this Annual Report as ANNEXURE-III.

Your Company has made all the information, required by Investors, available on the Company''s Corporate Website www.stlfasteners.com.

Management discussion & Analysis

Management Discussion and Analysis Report covering issues relating to Industry structure, Opportunities, Challenges, Outlook and Performance etc. has been given separately and form part of this Annual Report as ANNEXURE-IV.

Director''s Responsibility Statement

Pursuant to the requirement under section 217(2AA) of the Companies (Amendment) Act, 2000, with respect to Director''s Responsibility Statement, it is hereby confirmed that:

(i) in the preparation of the accounts for the Financial Year ended 31st March, 2013, the applicable accounting standards have been followed and there are no material departures;

(ii) the Directors have selected accounting policies in consultation with Statutory Auditors and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the financial year under review;

(iii) the directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956. The directors have confirmed that there are adequate control & systems for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) the Directors have prepared the accounts for the Financial Year ended 31st March, 2013 on a ''going concern'' basis.

Human Resources Development

Your Company recognizes that the ability to attract and retain the best talent is vital for the long term competitive advantage of the business. A set of initiatives are planned to widen the base of potential young recruits in your Company. Focused programs were launched to groom executive talent for leadership positions. During the year, your Company carried out workshops to provide inputs to senior leaders on how to appraise, coach and mentor their subordinates. Your Company has appointed a well renowned agency named "Human Dynamics" for the overall development of its Senior Management Personnel within the Company.

Various other initiatives have been planned for career planning, employee engagement and competency building.

Corporate Social responsibility

In Corporate Social Responsibility, the Company has taken up the responsibility for the education of 10 orphan children of SOS Children''s Village.

Industrial Relations

During the year under review, harmonious industrial relations were maintained in your Company.

Statutory Disclosures

Your Directors have made necessary disclosures, as required under various provisions of the Act and Clause 49 of the Listing Agreement.

Material Changes and Commitments

There are no material changes and commitments, affecting the financial position of the Company that have occurred between the end of the financial year of the Company and the date of signing of this report.

Directors

In terms of Article 89 of the Articles of Association and Sections 255 & 256 of the Companies Act, 1956, Shri K.R. Gupta retires by rotation in the forthcoming Annual General Meeting and being eligible offers himself for re-appointment.

Statutory Auditors

I) Appointment

M/s. S. R. Dinodia & Co., the Statutory Auditors of the Company, retire at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. M/s S. R. Dinodia & Co., have, under Section 224(1) of Companies Act, 1956, furnished the certificate of their eligibility for reappointment. As recommended by the Au- dit Committee, your Directors propose that they may be reappointed as Auditors of the Company from the con- clusion of this Annual General Meeting until the conclusion of the next Annual General Meeting of the Company.

II) Report

The Auditors'' Report and Notes on Accounts for the financial year 2012-2013 are self explanatory and therefore do not call for any further comments.

Internal Control System

Your Company has instituted internal control systems which are adequate for the nature of its business and the size of its operations. In the beginning of the year, the scope of audit exercise and the key business processes and selected risk areas to be audited are decided in consultation with the Audit Committee. The Internal Audit is carried out by a firm of external Chartered accountants and covers all departments. All significant audit observations and follow up actions thereon are reported to the Audit Committee.

Safety, Health and Environment (SHE) Measures

Protection of environment is the prime concern of your company. Your company complies with the relevant laws and regulations as well as take any additional measures considered necessary to Prevent pollution, maximize recycle, reduce waste, discharges and emissions. Company Conserve natural resources by their responsible arid efficient use in all the operations and plant trees

Quality Management System

Sterling Tools Limited has three units- Wire drawing unit which supplies Raw Material is certified for ISO -9001:2008.

Manufacturing units at Faridabad and Prithla are certified for TS -16949:2009. Our Plant at Prithla is certified for AS 9100 B.

Laboratory at Faridabad is NABL accredited and aligned to ISO -17025:2005. Faridabad plant is certified under Environment Management systems ISO -14001:2004.

Subsidiaries

Your Company does not have any subsidiary Company.

Cash Flow Analysis

In compliance with the provisions of Clause 32 of the Listing Agreement, the Cash Flow Statement for the year ended 31-03-2013 is annexed hereto.

Acknowledgements

Your Directors express their sincere thanks to all customers, vendors, investors, shareholders, bankers, consultants and advisors for their continued support throughout the year.

Your Directors also sincerely acknowledge the significant contributions made by all employees for their dedicated services to the Company.

Your Directors look forward to their continued support.

for and on behalf of the Board

Date: 13th May, 2013 M. L. Aggarwal

Place: Faridabad Chairman

DIN No. 00027380

Mar 31, 2012

The is indeed my privilege to present, on behalf of Board of Directors of your Company, the 33rd Annual Report and Audited Financial Statements for the Year ended 31st March 2012 together with the Auditors' Report.

Financial Results

The Company's performance for the Financial Year 2011 -2012 vis-a-vis 2010-2011 is summarized as under:

(Rs. in Lacs)

Particulars Financial Year

2011-2012 2010-2011

Revenue from Operations (Net) 29245.77 24812.71

Profit before interest, depreciation and tax 3766.41 3624.80

Interest 939.72 616.90

Depreciation 795.12 642.66

Profit Before Tax (PBT) 2031.57 2365.24

Provision for Tax 555.56 779.78

Profit After Tax (PAT) 1476.01 1585.46 Appropriations:

Proposed Dividend 342.23 342.23

Tax on Proposed Dividend 55.52 55.52

Transfer to General Reserve 150.00 160.00

Balance Carried to Balance Sheet 5539.45 4611.18

Review of Operations

The Company recorded the total Gross Revenue from Operations amounting to Rs. 32135.93 Lacs as compared to Rs. 27266.94 Lacs in previous year giving a growth of 18% approx. The Profit after tax is lower by 6.90% at Rs. 1476.01 Lacs as compared to Rs. 1585.46 Lacs in Previous year.

The significant reasons for decreased profitability are as follows:

a) Increased Raw Material cost because of increase in steel prices during the year and also due to volatility in foreign exchange rates.

b) Packing and Freight cost increased due to inflation and increase in export sales.

c) Cost of consumables and tools increased due to inflation and one time purchase of tools for new machines.

d) Financial cost - Financial cost increased due to increased interest rate and increased working capital requirements.

Dividend

Your Directors are pleased to recommend for your consideration and approval dividend at 50% for the year ended 31st March, 2012 (Rs, 51- per equity share) on the paid up equity share capital as compared to 50% for the year ended 31st March 2011 (Rs. 5/'- per Equity Share. The dividend if approved at ensuing Annual General Meeting will absorb Rs. 397,75 Lacs Including Corporate Dividend Tax amounting to Rs. 55.52. The dividend will be paid to members whose names appear in the register of members as on a record date.

Transfer to General Reserve

Out of the profits of the Company, a sum of Rs. 150 Lacs has been transferred to General Reserves during the year and total Reserves and surplus of the Company are Rs. 7521.27 Lacs as on 3181 March, 2012.

Deposits

The Company has not accepted any deposits during the year which come under the purview of Section 58A of the Companies Act, 1956 and as such no amount on account of principal or interest was outstanding as on the date of Balance Sheet.

Shifting of Registered Office

The Registered Office of your Company has been shifted from A-40, Mohan Co-operative Industrial Estate, Mathura Road, New Delhi-110044 to 243, Okhla Industrial Estate, Phase-II, New Delhi-110020 with effect from 1stApril, 2012.

Capital Structure and Listing

As on 31st March, 2012, the Company has Authorised Share Capital of Rs.10,00,00,000/-and Paid Up Share Capital of Rs. 6,84,46,000/-. The equity shares of the Company are listed with Bombay Stock Exchange Limited and National Stock Exchange of India Limited. There are no arrears on account of payment of listing fees to the said Stock Exchanges.

The Promoters and Persons acting in concert with them hold 69.56% share Capital of the Company as on 31sl March, 2012 as against 69.19% as on 31st March. 2011.

Investments made in Joint Venture Company

During the Year under review, Your Company has further invested Rs. 2,00,00,000/-(divided into 2,50,000 Equity shares @ Rs. 10/- per share issued at a premium of Rs. 70/- per share) in Equity share Capital of Sterling Fabory India Private Limited, a Joint venture Company.

The Joint Venture Company made Sales of Rs. 237.90 Lacs during the Financial Year 2011 -2012.

Particulars of Employees

As required by Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, a statement on information relating to employees has been given by way of Annexure-I to this Report.

Conservation of energy, technology absorption and foreign exchange earnings and outgo

Information pursuant to the provisions of Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, relating to conservation of energy, technology absorption & foreign exchange earnings and outgo are given byway of Annexure-II to this Report.

Corporate Governance

The Company is committed to maintain the highest standards of corporate governance. The directors adhere to the requirements set out by the Securities and Exchange Board of India' Corporate Governance Practices and have implemented all the stipulations prescribed.

Adetailed report on Corporate Governance pursuant to the provisions of Clause 49 of Listing Agreement supported by a Certificate given by the Statutory Auditors of the Company confirming compliance of conditions, form part of this Annual .

Report as ANNEXURE-lll.

Your Company has made all the information, required by Investors, available on the Company's Corporate Website www.stlfasteners.com.

Management discussion & Analysis

Management Discussion and Analysis Report covering issues relating to Industry structure, Opportunities, Challenges,

Outlook and Performance etc. has been given separately and form part of this Annual Report as ANNEXURE-IV.

Director's Responsibility Statement

Pursuant to the requirement under section 217(2AA) of the Companies (Amendment) Act, 2000, with respect to Director's Responsibility Statement, it is hereby confirmed that:

(I) in the preparation of the accounts for the Financial Year ended 31st March, 2012, the applicable accounting 1 standards have been followed and there are no material departures;

(ii) the Directors have selected accounting policies in consultation with Statutory Auditors and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the financial year under review;

(iii) the directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956. The directors have confirmed that there are adequate control & systems for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) the Directors have prepared the accounts for the Financial Year ended 31st March, 2012 on a 'going concern' basis.

Human Resources Development

You are aware that your Company has vast pool of skilled and talented professional-the most valuable asset for the company. We have created an enabling work environment that encourages originality and innovative thinking. The core Policy of your Company is to attract and retain high calibre employees while engaging and nurturing them to achieve leadership in our area of operations.

Your company continued to develop and extend policies and procedures that nurture the potential and talent of all our employees to optimize the benefits from this significant investment.

Performance Management System, Performance Linked Bonuses/Incentives, Resource Planning, Training and Development, Career Progression etc. Are some of the policies and procedures that have matured overtime.

Corporate Social responsibility

In Corporate Social Responsibility, the Company has taken up the responsibility for the education of 10 orphan children of SOS Children's Village.

Awards & Recognition

During the last Financial Year, your company had got following awards:

a. GREEN VENDOR from Hero Honda

b. HR LEADERSHIPAWARD 2012 from Knowledge Resource Development and Welfare Group, ILT Delhi.

Industrial Relations

During the year under review, harmonious industrial relations were maintained in your Company.

Statutory Disclosures

Your Directors have made necessary disclosures, as required under various provisions of the Act and Clause 49 of the Listing Agreement.

Material Changes and Commitments

There were no material changes and commitments, affecting the financial position of the Company that have occurred between the end of the financial year of the Company and the date of signing of this report.

Directors

In terms of Article 89 of the Articles of Association and Sections 255 & 256 of the Companies Act, 1956, Shri Chhotu Ram Sharma retires by rotation in the forthcoming Annual General Meeting and being eligible offer himself for re- appointment.

Statutory Auditors

I) Appointment

M/s. S. R. Dinodia&Co., the Statutory Auditors of the Company, retire at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. M/s S.R. Dinodia & Co., have, under Section 224(1) of Companies Act, 1956, furnished the certificate of their eligibility for reappointment. As recommended by the Audit Committee, your Directors propose that they may be reappointed as Auditors of the Company from the conclusion of this Annual General Meeting until the conclusion of the next Annual General Meeting of the Company.

II) Report

The Auditors' Report and Notes on Accounts for the financial year 2011 -2012 are self explanatory and therefore do not call for any further comments.

Internal Control System

The operations of your Company have been structured to provide adequate support and controls. Standard procedures and guidelines issued to the operational departments from time to time to support best practices are followed in all areas of operations.

M/s J FRA & Associates, the Chartered Accountants based at New Delhi are working as Internal Auditors of the Company.

The Detailed Report of Internal Audit is presented to Management and an Executive summary containing significant issues of repetitive nature, affecting the Company substantially in financial terms, Non compliances with any Statutory laws are presented to Audit Committee on quarterly basis for necessary directions thereon.

Safety, Health and Environment (SHE) Measures

Protection of environment is the prime concern of your company. Your company complies with the relevant laws and regulations as well as take any additional measures considered necessary to Prevent pollution, maximize recycle, reduce waste, discharges and emissions. Company Conserve natural resources by their responsible and efficient use in all our operations and plant trees

Quality Management System

Sterling Tools Limited has three units- Wire drawing unit which supplies Raw Material is certified for ISO -9001:2008.

Manufacturing units at Faridabad and Prithla are certified for TS -16949:2009. Our Plant at Prithla is certified for AS 9100 B.

Laboratory at Faridabad is NABL accredited and aligned to ISO -17025:2005. Faridabad plant is certified under Environment Management systems ISO -14001:2004.

Subsidiaries

Your Company does not have any subsidiary Company.

Cash Flow Analysis

I n compliance with the provisions of Clause 32 of the Listing Agreement, the Cash Flow Statement for the year ended 31 - 03-2012 is annexed hereto.

Acknowledgements

Your Directors wish to place on record their appreciation to all the stakeholders of the Company for reposing their faith, trust, confidence in the Company. Your Directors would like to place on record their deep and sincere appreciation for the hard work, dedication and unstinting efforts of your Company's employees to ensure that your Company reaches the pinnacle of success.

Your Directors express their thanks to all the shareholders, vendors, bankers, consultants, customers and governmental & statutory authorities for their sustained support.

for and on behalf of the Board

Date: 15th May, 2012 M. L. Aggarwal

Place: Faridabad Chairman

Mar 31, 2011

The Directors are pleased to present the 32nd Annual Report on the business operations and financials of the Company for the Financial Year ended 31st March 2011.

Financial Results

The Companys performance for the Financial Year 2010-2011 vis-a-vis 2009-2010 is summarized as under:

(Rs. in Lacs) Particulars Financial Year 2010-2011 2009-2010

Net Sales Turnover 24793.51 17952.54

Profit before interest, depreciation and tax 3598.57 3027.58

Interest 589.83 534.38

Depreciation 642.66 629.07

Profit Before Tax (PBT) 2366.08 1864.13

Provision for Tax 793.09 705.25

Profit After Tax (PAT) 1572.99 1158.88

Appropriations:

Proposed Dividend Ã Interim 0.00 136.89

Ã Final 342.23 205.34

Tax on Proposed DividendÃ Interim 0.00 22.74

Ã Final 55.52 34.90

Transfer to General Reserve 160.00 120.00

Balance Carried to Balance Sheet 4611.18 3583.47

Review of Operations

The Company recorded the total Net Sales Turnover amounting to Rs. 24793.51 Lacs as compared to Rs. 17952.54 Lacs in previous year giving a growth of 38.11% approx. The profit after tax was higher by 35.73% at Rs.1572.99 Lacs as compared to Rs. 1158.88 Lacs in Previous year.

The Company is continuously focusing on its core area of supplying fasteners to Original Equipment Manufacturers (OEMs) all over India and efforts have also been made for increasing the Companys business share in Retail Market from Rs. 234.90 Lacs to Rs. 300.00 Lacs showing a growth rate of 27.71%. Similarly the Company has also focused on its Export Sales which was Rs.1268.83 Lacs (FOB value) for the financial year 2010-2011 as against Rs. 572.60 Lacs (FOB value) showing a growth of 121.59%.

The Company has adequate production facilities with sole objective of providing quality products at reasonable prices as well as satisfying the interests of all stake holders in the Company.

The Company has projected a growth of 25% in the Total Sales Turnover for the financial year 2011-2012.

Dividend

Keeping in view the Companys performance, the Directors are pleased to recommend a dividend of 50% for the financial year ended 31st March, 2011 (Rs. 5/- per equity share) on the paid up equity share capital as compared to 50%(30% interim dividend + 20% Final dividend) for the financial year ended 31st March 2010 (Rs. 5/- per Equity Share (Rs. 3/- Interim dividend + Rs. 2/- Final Dividend per equity share).

Transfer to General Reserve

Your Company has transferred Rs. 160 Lacs to General Reserves during the financial year 2010-11 as compared to Rs. 120 Lacs in previous financial year.

Deposits

The Company has not accepted any deposits, which come under the purview of Section 58A of the Companies Act, 1956.

Listing

The equity shares of the Company are listed with Bombay Stock Exchange Limited and National Stock Exchange of India Limited. There are no arrears on account of payment of listing fees to the said Stock Exchanges.

Joint Venture

During the financial year under review, Your Company has invested Rs. 1,75,00,000/- in Equity Share Capital of the Company of Sterling Fabory India Private Limited, a Joint venture Company engaged in the business of wholesale distribution, supply chain and vendor management of non-automotive and automotive fasteners and standard and non-standard(customer specific) non automotive electronic and other components.

During the financial year under review, the Joint Venture Company has started its operations in April 2010 by establishing its main Trading Setup at 12/2, Delhi Mathura Road, Faridabad with Branch office/ Warehouse at Pune. The Joint Venture Company made a Sales of Rs. 57 Lacs which is expected to be Rs. 675 Lacs for the Financial Year 2011-2012. The Company plans to set up branch offices / warehouses at Bangalore and Chennai.

Particulars of Employees

As required by Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, a statement on information relating to employees has been given by way of Annexure-I to this Report.

Conservation of energy, technology absorption and foreign exchange earnings and outgo

Information pursuant to the provisions of Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, relating to conservation of energy, technology absorption & foreign exchange earnings and outgo are given by way of Annexure-II to this Report.

Corporate Governance

Your Company stand committed to good Corporate Governance-accountability, transparency, disclosures and independent supervision to increase the value of stakeholders. The Company is committed to transparency in all its dealings with shareholders, employees, the creditors, the Government and other parties and places high emphasis on business ethics.

Your Companys basic philosophy of Corporate Governance in the Company is to achieve business excellence and increasing long-term shareholder value, keeping in view the interest of the companys stakeholders.

Your Company is in compliance with the requirements of the guidelines on Corporate Governance stipulated under clause 49 of listing agreement existing as of 31st March 2011.

A report on Corporate Governance pursuant to the provisions of Clause 49 of Listing Agreement supported by a Certificate given by the Statutory Auditors of the Company confirming compliance of conditions, form part of this Annual Report as ANNEXURE-III.

Your Company has made all the information, required by Investors, available on the Companys Corporate Website www.stlfasteners.com.

Management Discussion & Analysis

Management Discussion and Analysis Report covering issues relating to Industry structure, Opportunities, Challenges, Outlook and Performance etc. has been given separately and form part of this Annual Report as ANNEXURE-IV.

Directors Responsibility Statement

Pursuant to the requirement under section 217(2AA) of the Companies (Amendment) Act, 2000, with respect to Directors Responsibility Statement, it is hereby confirmed that:

(i) in the preparation of the accounts for the Financial Year ended 31st March, 2011, the applicable accounting standards have been followed and there are no material departures;

(ii) the Directors have selected accounting policies in consultation with Statutory Auditors and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the financial year under review;

(iii) the directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956. The directors have confirmed that there are adequate control & systems for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) the Directors have prepared the accounts for the Financial Year ended 31st March, 2011 on a going concern basis.

Human Resources Development

Your Company strongly believes that its ability to maintain and continue its growth depends largely on its strength of attracting, developing, motivating and retaining the talent. Therefore, it is the endeavour of your Company to nurture and develop this wealth

a) Industrial Relations

During the financial year under review, harmonious industrial relations were maintained in your Company.

b) Trainings for development of Human Resources

During the financial year under review, Your Company had training target of 4 man days of training for every employee and we have achieved the target.

Your Company had prepared Skill/Competency Matrix for all employees

The training need identification was done through analysis of Skill/ Competency Matrix.

Your Company conducted technical, soft skills and behavioral training some managers were sent to IIMs, etc. for Management Development Programmes. Outbound Training was conducted for team building. Two employees were sent for AOTS training in Japan.

Moreover Your Company had conducted Induction training for all new recruits.

c) Kaizens:

Your Company had done well in Kaizens last financial year by implementing about 1500 kaizens, resulting to savings and improvement in 5S, Systems, Process, Safety, Morale, Methods, Productivity, Reducing losses, Energy saving etc.

Statutory Disclosures

Your Directors have made necessary disclosures, as required under various provisions of the Act and Clause 49 of the Listing Agreement.

Material Changes and Commitments

There were no material changes and commitments, affecting the financial position of the Company that have occurred between the end of the financial year of the Company and the date of signing of this report.

Directors

In terms of Article 89 of the Articles of Association and Sections 255 & 256 of the Companies Act, 1956, Dr. T. N. Kapoor retires by rotation in the forthcoming Annual General Meeting and being eligible offer himself for re-appointment.

Statutory Auditors

I) Appointment

M/s. S. R. Dinodia & Co., the Statutory Auditors of the Company, retire at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. M/s S.R. Dinodia & Co., have, under Section 24(1) of Companies Act, 1956, furnished the certificate of their eligibility for reappointment. As recommended by the Audit Committee, your Directors propose that they may be reappointed as Auditors of the Company from the conclusion of this Annual General Meeting until the conclusion of the next Annual General Meeting of the Company.

II) Report

The Auditors Report and Notes on Accounts for the financial year 2010-2011 are self explanatory and therefore do not call for any further comments.

Internal Control System

M/s JRA & Associates, the Chartered Accountants based at New Delhi are working as Internal Auditors of the Company.

The Detailed Report of Internal Audit is presented to Management and an Executive Summary containing significant issues of repetitive nature, affecting the Company substantially in financial terms, Non compliances with any Statutory laws are presented to Audit Committee on quarterly basis for necessary directions thereon.

Safety, Health and Environment (SHE) Measures

Your Company maintain a healthy Environmental, Health and Safety Management Policy and comply with all the legal compliances. The Company is having zero discharge facility at Prithla Plant and is on forefront for plantation of tree and adopting measures to conserve natural resources viz. Water and Power. Your Company is accredited to ISO 14001:2004.

Quality Management System

Sterling Tools Limited has three units- Wire drawing unit which supplies Raw Material is certified for ISO -9001:2008.

Manufacturing units at Faridabad and Prithla are certified for TS -16949:2009. Our Plant at Prithla is certified for AS 9100 B.

Laboratory at Faridabad is NABL accredited and aligned to ISO -17025:2005. Faridabad plant is certified under Environment Management Systems ISO -14001:2004.

Prithla plant has plan to acquire ISO 14001 in the current financial year.

Subsidiaries

Your Company doesnt have any Subsidiary Company.

Cash Flow Analysis

In compliance with the provisions of Clause 32 of the Listing Agreement, the Cash Flow Statement for the financial year ended 31-03-2011 is annexed hereto.

Acknowledgements

Your Directors would like to express their appreciation to all the Companys employees for their performance and continued support. The Directors would also like to thank all the shareholders, vendors, bankers, consultants, customers and governmental & statutory authorities for their sustained support.

for and on behalf of the Board

M. L. Aggarwal Chairman DIN No. 00027380

Date:17th May, 2011 Place: Faridabad

Mar 31, 2010

The Directors are pleased to present the 31st Annual Report on the business operations and financials of the Company for the Financial Year ended 31st March 2010.

Financial Results

The Companys performance for the Financial Year 2009-2010 2008-2009 is summarized as under:

(Rs. in Lacs)

Particulars Financial Year

2009-2010 2008-2009

Gross Sales Turnover 19451.72 17032.44

Profit before interest, depreciation and tax 3027.58 1580.17

Interest 534.38 665.97

Depreciation 629.07 614.84

Profit Before Tax (PBT) 1864.13 299.36

Provision for Tax 705.25 127.64

Profit After Tax (PAT) 1158.88 171.72

Appropriations:

Proposed Dividend 342.23 68.45

Tax on Proposed Dividend 57.63 11.63

Transfer to General Reserve 120.00 0.00

Balance Carried to Balance Sheet 3583.48 2944.46

Review of Operations

The performance of your Company during the Year under review has shown improvement over the previous year. Sales at Rs. 19451.72 Lacs increased, by 14.20% as compared to sales at Rs. 17032.44 Lacs in the previous financial year and the Profit before Tax for the Financial Year 2009-2010 at Rs. 1864.13 Lacs increased by 522.71% as compared to Rs. 299.36 Lacs in the previous financial year.

Dividend

In view of Sterlings tradition of high regard for its shareholders, the Directors had, in their meeting held on 18th February, 2010, recommended 30% interim dividend for fiscal year 2009-2010 against 10% dividend for the previous year. This interim dividend has already been paid and taking note of this payout, your Directors are pleased to recommend the payment of final dividend for the Year ended 31st March, 2010 at Rs. 2/- Per Share (20%) on face value of Rs. 10/- per share (Previous Year Rs. 1/- per Share (10%), subject to approval of shareholders in ensuing Annual General Meeting.

Transfer to General Reserve

Your Company has transferred Rs. 120 Lacs to General Reserves during the Financial Year 2009-10 as compared to Rs. Nil in previous Financial Year.

Deposits

The Company has not accepted any deposits, which come under the purview of Section 58A of the Companies Act, 1956.

Listing

The equity shares of the Company are listed with Bombay Stock Exchange Limited and National Stock Exchange of India Limited. There are no arrears on account of payment of listing fees to the said Stock Exchanges.

Shifting of Registered Office

The Registered Office of your Company has been shifted from F-37, Okhla Industrial Area, Phase-I, New Delhi-110020 to A-40, Mohan Co-operative Industrial Estate, Mathura Road, New Delhi-110044 with effect from 2nd March, 2010.

Joint Venture

During the Year under review, Your Company has entered into a Joint Venture Agreement with M/s Borstlap Masters in Fasteners Group B.V. (Fabory), a Netherland based Company to form a Joint Venture Company in India in ratio of 50:50. Accordingly a Joint Venture Company named Sterling Fabory India Private Limited has been formed in March, 2010 with its Registered Office in Delhi. Till date Your Company has invested Rs. 1,75,00,000/- in the said JVC in form of Share Capital.

The Joint Venture Company will be doing business of wholesale distribution, supply chain and vendor management of non-automotive and automotive fasteners and standard and no-standard(customer specific) non automotive electronic and other components, assemblies and sub-assemblies and fittings, of all kinds and for all industries and components thereof.

Particulars of Employees

As required by Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, a statement on information relating to employees has been given by way of Annexure-I to this Report.

Conservation of energy, technology absorption and foreign exchange earnings and outgo

Information pursuant to the provisions of Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, relating to conservation of energy, technology absorption & foreign exchange earnings and outgo are given by way of Annexure-II to this Report.

Corporate Governance

Your Company follows the principles of the effective Corporate Governance practices as set out by SEBI vide Clause 49 of the Listing Agreement.

A report on Corporate Governance pursuant to the provisions of Clause 49 of Listing Agreement supported by a Certificate given by the Statutory Auditors of the Company confirming compliance of conditions, form part of this Annual Report as ANNEXURE-III.

Your Company has made all the information, required by Investors, available on the Companys Corporate Website www.stlfasteners.com.

Management discussion & Analysis

Management Discussion and Analysis Report covering issues relating to Industry structure, Opportunities, Challenges, Outlook and Performance etc. has been given separately and form part of this Annual Report as ANNEXURE-IV.

Directors Responsibility Statement

Pursuant to the requirement under section 217(2AA) of the Companies (Amendment) Act, 2000, with respect to Directors Responsibility Statement, it is hereby confirmed that:

(i) in the preparation of the accounts for the Financial Year ended 31st March, 2010, the applicable accounting standards have been followed and there are no material departures;

(ii) the Directors have selected accounting policies in consultation with Statutory Auditors and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the financial year under review;

(iii) the directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956. The directors have confirmed that there are adequate control & systems for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) the Directors have prepared the accounts for the Financial Year ended 31st March, 2010 on a Ãgoing concern basis.

Human Resources Development

Your Company strongly believes that its ability to maintain and continue its growth depends largely on its strength of attracting, developing, motivating and retaining the talent. Therefore, it is the endeavour of your Company to nurture and develop this wealth

a) Industrial Relations

During the year under review, harmonious industrial relations were maintained in your Company.

b) Trainings for development of Human Resources

During the year under review, Your Company had training target of 4 man days of training for every employee and we have achieved the target.

Your Company had prepared Skill/Competency Matrix for all employees .The training need identification was done through analysis of Skill/ Competency Matrix.

Your Company conducted both technical and soft skills training and even some of the employees were sent to IIMs, etc. for Management Development Programmes as well as Outbound Training was also conducted for team building. One employee was sent for AOTS training in Japan.

Moreover Your Company had conducted Induction training for all new recruits.

Your company won the HR Excellence Award of Amity University.

c) Kaizens:

Your Company had done well in Kaizens last year by implementing 1600+ kaizens, resulting to savings and lot of improvements in 5S, Systems, Process, Safety, Morale, Methods, Productivity, reducing wastages, energy saving ,etc

Your company won the 2nd position in the CII/ACMA Kaizen Competition.

Statutory Disclosures

Your Directors have made necessary disclosures, as required under various provisions of the Act and Clause 49 of the Listing Agreement.

Material Changes and Commitments

There were no material changes and commitments, affecting the financial position of the Company that have occurred between the end of the financial year of the Company and the date of signing of this report.

Directors

In terms of Article 89 of the Articles of Association and Sections 255 & 256 of the Companies Act, 1956, Shri Atul Aggarwal retire by rotation in the forthcoming Annual General Meeting and being eligible offer himself for re-appointment.

Statutory Auditors

I) Appointment

M/s. S. R. Dinodia & Co., the Statutory Auditors of the Company, retire at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. M/s S.R. Dinodia & Co., have, under Section 224(1) of Companies Act, 1956, furnished the certificate of their eligibility for reappointment. As recommended by the Audit Committee, your Directors propose that they may be reappointed as Auditors of the Company from the conclusion of this Annual General Meeting until the conclusion of the next Annual General Meeting of the Company.

II) Report

The Auditors Report and Notes on Accounts for the financial year 2009-2010 are self explanatory and therefore do not call for any further comments.

Internal Control System

The Company has well established and efficient Internal Control Systems under the assistance of M/s JRA & Associates, the Internal Auditors of the Company.

The Company has also well defined powers of various executives working at different levels within the Company.

The Report of Internal Audit on quarterly basis is subject to review and approval by Audit Committee of the Board and necessary directions are issued wherever necessary.

Subsidiaries

Your Company do not have any subsidiary Company.

Cash Flow Analysis

In compliance with the provisions of Clause 32 of the Listing Agreement, the Cash Flow Statement for the year ended 31-03-2010 is annexed hereto.

Acknowledgements

Your Directors would like to express their appreciation to all the Companys employees for their performance and continued support. The Directors would also like to thank all the shareholders, vendors, bankers, consultants, customers and governmental & statutory authorities for their sustained support.

for and on behalf of the Board

Date: 19th July, 2010 M. L. Aggarwal

Place: Faridabad Chairman

DIN No. 00027380

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