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Directors Report of Sunshield Chemicals Ltd.

Mar 31, 2018

Dear Members,

The Directors are pleased to submit their 31^st Annual Report of the business operations together with the Audited financial statements of the Company for the year ended 31^stMarch 2018:

1. OVERVIEW OF FINANCIARESULTS

(Rs. in Lakhs)

	2017-2018	2016-2017
Sales	18500	17482
Other Operating Income	26	27
Revenue from Operations	18526	17509
Other Income	153	22
Total Income	18679	17531
Less : Materials Consumed	12585	11358
Employees Remuneration & Benefits	713	661
Manufacturing, Administrative, Selling &	3665	4775
Other Expenses
Total Expenses	16963	16794
Operating Profit (EBITDA)	1716	737
Less: Finance Cost	969	932
Profit / (Loss) Before Tax	747	(195)
& Depreciation
Less: Depreciation	596	598
Net Profit/ (Loss) Before Tax	151	(793)
Less: Tax Expense Current Tax Expense Deferred Tax (Credit)/Charge	31	(126)
Net Profit / (Loss) after Tax	120	(667)
Other Comprehensive Income
Add: Remeasurements of post	5	(4)
employment benefit obligation Income tax related to items		1
that will not be reclassified to
profit or loss
Total Comprehensive Income for the period	125	(670)

2 ADOPTION OF INDIAN ACCOUNTING STANDARDS (IND AS)

Beginning 1^st April, 2017, the Company has, for the first time, adopted Indian Accounting Standard (Ind AS) with a transition date of 1^st April, 2016. Accordingly, the financial statements have been prepared in compliance with Ind AS as notified by the Ministry of Corporate Affairs and prescribed under Section 133 of the Companies Act, 2013 (hereinafter referred to as "the Act") read with relevant rules made thereunder and other accounting pronouncements generally accepted in India. Accordingly, the figures for the corresponding year ended 31^st March, 2017 have also been presented after incorporating the applicable Ind AS adjustments.

3. DIVIDEND

In view of carried forward losses, the Board of Directors does not recommend any dividend for the year ended 31^st March 2018.

4. SHARE CAPITAL

The paid up Equity Share Capital as on 31^st March, 2018 was Rs. 7.35 Crores. During the year under review, the Company has not issued new shares.

5. MANAGEMENT''S DISCUSSION AND ANALYSIS : F.Y. 2017-2018

I. Industry Structure & Development :-

The Chemical Industry is a key enabler for other industries. As chemicals are consumed in varying proportion by every industry (rightly from electronics to paints, from pharmaceuticals to cosmetics), without chemicals sustainable development of other sectors is not possible.

The Chemical Industry is a crucial constituent of the growing Indian Economy, providing the key material for several industries. The Company is operating only in one Segment, namely ''Specialty Chemicals''. Specialty Chemicals are particular chemical products which provide a wide variety of effects on which many other industry sectors rely.

Specialty chemicals, which comprise of low volume, high value chemicals with specific applications, constitute a significant part of the Indian chemical industry and are targeted towards specific end-use applications.

Specialty chemicals are produced by a complex, interlinked industry. In the strictest sense, specialty chemicals are chemical products that are sold on the basis of their performance or function, rather than their composition. Products and services in the specialty chemicals industry require intensive knowledge and ongoing innovation.

The Company manufactures a wide range of specially formulated and customized products for various Industrial applications. Company''s customers are well recognized and located not only in India but all over the World especially in America, Europe, and Far- East.

Our customers represent a wide range of Industries such as Wire Insulation Enamel, PVC stabilizers, Inks, Colours, Coatings, Textiles, Agro Chemicals, Polymers, Plastics, Rubber, Latex, Tyre and Tubes, Conveyor belts, Lubricants, Additives, Home care, Cosmetic, Soaps detergents, Fertilizers and many more.

Our customers are always seeking innovative products formulations for their current process needs, which are fulfilled by Company''s Production Development, application knowledge & experience. Solvay Group which represents this worldwide, in specialty chemicals supports the Sunshield team.

Company''s main products belong to:

a. Specialty Surfactant applications, which are predominantly Ethylene Oxide (EO) based products. The technologies developed involve surfactants, Esters, Amides, and other complementary processes.

b. Specialty Anti-Oxidants for Lubricants, Polymers, Rubber, Tyre & Latex and other Industries involving Aminic & Phenolic technologies and

c. Other Non-EO technologies & customized blends for various applications.

II. Operating and Financial Performance of the Company

(Rs. in Lakhs)

	F.Y. 2017-2018	F.Y. 2016-2017	Change over Previous Year
i) Exports	7953	8182	(3%)
ii) Domestic	10547	9300	13%
iii) Other Operating	26	27	(4%)
Income
Revenue from	18526	17509	6%
Operation (Excluding Excise Duty)
Other Income	153	22	595%
Total Income	18679	17531	7%

	F.Y. 2017-2018	F.Y. 2016-2017	Change over Previous Yeai
Volume Sales (MT)	13704	13323	3%
Sales Value (Rs.)	18500	17482	6%
Average Production (Rs. per kg)	135	131	3%

During the year, Sales by Volume went up by 3%, whereas the sales in Value terms went up by 6%.

Export Sales went down by 3 % from Rs. 8,182 Lakhs to Rs. 7,953 Lakhs and domestic Sales went up by 13% from Rs. 9,300 Lakhs in 2016-17 to Rs. 10,547 Lakhs in 2017-2018.

Major change is in sales of Theic where volume has gone down but on a higher price realization. Sale of Ethoxylates, Propoxylates and Antioxidants products in terms of value and volume has gone up as compared to last year. The improvement is mainly due to change in product mix and increase in the demand of products.

Profits are mainly on account of improved margin on sales, positive forex fluctuations gains.

III. Outlook

The growth for specialty chemicals is driven by both domestic consumption and exports. Specialty chemicals finding applications across consumer, industrial and infrastructure segments are driven by the overall growth of the Indian economy. The segment has immense potential for growth, driven by growing end user industry. Technology & Innovation will play a major role in growth.

The Company''s products continue to be well received by World''s leading users of specialty chemicals for a diverse range of industrial applications. The Company has been recognized as a reputable and dependable supplier to many Indian and global consumers of specialty products developed in-house.

Company remains optimistic on its future out look however, there is need to watch out for volatility of raw material prices, increased competition from abroad, ability of the Company to develop new business in new business segments.

IV Risks and Concerns

The Present and future risks are reviewed by the management of the Company at regular intervals. Adequate risk management is a key success factor, to mitigate risks associated with the solutions we provide. Major risks identified by the business and functions are systematically addressed through by taking corrective actions on continuous basis. These are discussed at Audit Committee and Board of Directors Meetings.

Major Risk arises from main raw material viz., Ethylene Oxide (EO). EO is currently and consistently available from only one manufacturer in the country. Besides some of the major raw materials are hazardous and inflammable. The Company has ensured that Safety equipment''s and infrastructure are in place as per statutes and global safety standards.

V. Internal Financials Controls and its , adequacy

Internal Checks and Controls covering operations of the Company are in place and are constantly being improved upon. The Company had laid down internal financial controls to be followed by the Company and such policies and procedures adopted by the Company are for ensuring the orderly and efficient conduct of its business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.

During the year, the internal auditors of the Company have reviewed the effectiveness and efficiency of these controls and procedures. As per the said assessment Board is of the view the Internal Financial Controls operate effectively and no material weaknesses exist.

VI. Human Resources

Employee relationships at all levels continued to be satisfactory. The management would like to record its appreciation of dedicated and strong support provided to your Company, by its employees at all levels. The number of the employees on the rolls as on 31^st March 2018 is 95.

(The statement in this report including Management''s Discussions & Analysis Report reflects Company''s projections, estimates, expectations or predictions. These may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied, since your Company''s operations are influenced by many external and internal factors beyond the control of the Company.)

6. BOARD OF DIRECTORS COMPOSITION

The composition of the Board of Directors of the Company is in complete conformity with the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Companies Act 2013. The composition of the Board represents an optimal mix of professionalism, knowledge and experience which enables the Board to discharge its responsibilities and provide effective leadership to the business. None of the Directors of the Company is related inter-se. The details of the Board of Directors, as on date of this report are as under:

Sr. no.	Name of Director	Category of Directorship
1	R L Shenoy	Non-executive Chairman and Independent Director
2	Ajit Shah	Non-Executive Independent Director
3	Aruna Soman	Non-Executive Independent and Woman Director
4	Chidananda Bhagwat*	Executive Director
5	Manoj Khullar	Managing Director
6	Srivata M K^	Executive Director
7	Satish Kelkar	Non-Executive Director
8	Ian Brown	Non-Executive Director
9	Boon Tong Goh#	Non-Executive Director
10	Yock Jeng Koh@	Non-Executive Director
11	Guo Lin^!	Alternate Director

* Mr. Chidananda Bhagwat is Director upto 23^rd July 2018.

^ Mr. Srivatsa M K was appointed as Director with effect from 19^th July 2018

# Mr. Boon Tong Goh was appointed as Director with effect from 28^th May 2018.

@ Mr. YockJeng Koh was appointed as Director with effect from 28^th May 2018.

! Mr. Guo Lin was appointed as Alternate Director to Mr. YockJeng Koh with effect from 28^th May 2018.

7. BOARD MEETINGS

The Board meets at regular intervals to discuss and decide on Company / business policy and strategy apart from other Board business.

The Board met four times in the financial year 2017-18 i.e on 26^th May 2017, 12^th September 2017, 13^th December 2017 and 13^th February 2018.

8. BOARD COMMITTEES

There are currently six Committees of the Board, which are given below:

- Audit Committee

Audit Committee includes Five Directors viz., Mr. Ajit Shah (Chairman/Independent Director), Mrs. Aruna Soman (Independent Director), Mr. Ranjal Laxmana Shenoy (Independent Director), Mr. Manoj Khullar (Managing Director) and Mr. Satish Kelkar (Non-Executive Director).

The role includes amongst others, oversight of Company''s financial reporting process and disclosure of financial information to ensure that the financial statements are correct, sufficient and credible; recommending the appointment, re-appointment, remuneration and terms of appointment of auditors and approval of payment for any other services rendered by statutory auditors; reviewing with the management quarterly results and annual financial statements before submission to the Board for approval; approval or any subsequent modification of any transactions of the Company with related parties; review and monitor the auditor''s independence and performance and effectiveness of audit process; scrutiny of inter corporate loans and investments, if any; evaluation of internal financial controls and risk management system; and reviewing the functioning of the whistle blower mechanism, reviewing the findings of any internal investigation involving suspected fraud or irregularity. The Audit Committee also reviews before submission to the Board for approval of financial statements, the Directors Responsibility statement, changes in accounting policies, if any, with reasons for the same, Management Discussions and Analysis on Company''s operations.

Audit committee met 4 times on 26^th May 2017, 12^th September 2017, 13^th December 2017 and 13^th February 2018.

- Nomination and Remuneration Committee

The Board has constituted Nomination and Remuneration Committee which comprises of Independent Directors viz. Mr. Ranjal Laxmana Shenoy, Mr. Ajit Shah, and Mrs. Aruna Soman.

The role of the committee include the Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy, relating to the remuneration of the directors, key managerial personnel and other employees; formulation of criteria for evaluation of Independent Directors and the Board; devising a policy on Board diversity; and identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the Board their appointment and removal.

- Stakeholders'' Relationship Committee

Stakeholders Relationship Committee comprises of Mr. Ajit Shah (Independent Director) Mrs. Aruna Soman (Independent Director), and Mr. Manoj Khullar (Managing Director).

The Committee focuses primarily on monitoring and ensuring that all shareholder and investor services operate in an efficient manner and that shareholder and investor grievances / complaints including those of all other stakeholders are addressed promptly with the result that all issues are resolved rapidly and efficiently.

Corporate Social Responsibility (CSR) Committee

The Board has constituted Corporate Social Responsibility Committee comprising of Mr. Ajit Shah (Independent Director), Mr. Chidananda Bhagwat (Director) (till 19^th July . 2018) Mr. Srivata M.K. (from 20^th July 2018) and Mr. Manoj Khullar (Managing Director).

The Committee focuses on formulation and Review of CSR policy indicating activities to be und ertaken by the Co mp any; recommendation of the amount of expenditure to be incurred on CSR activities and monitoring and implementing this policy from time to time.

During the year under review, the Company was not required to spend on CSR activities on account of the losses incurred by the Company in the three preceding financial years. However as a part of societal responsibility, the Company has spent on CSR activities during the year under review.

The CSR policy of the Company and Annual Report on CSR activities is annexed herewith as Annexure A.

- Risk Management Committee

The Board has constituted Risk Management Committee comprising of Mr. Manoj Khullar (Managing Director), Mr. Chidananda Bhagwat, (Director) (till 19^th July 2018) Srivata M.K. (from 20^th July 2018)and Mr. Shekhar Pattekar (Manager Factory).

The role of Risk Management Committee includes reviewing and approving the risk management policies of the Company; assessment and monitoring of all risks associated with the operations of the Co mp an y and development an d implementation of internal compliance and control systems and procedures to manage risk.

- Committee for Issue of Duplicate Share Certificates

The Board has constituted a Committee for the purpose of issuance of duplicate share certificates. The Committee comprises of viz Mr. Satish Kelkar (Non-executive director), Mr. Chidananda Bhagwat (Director (till 19^th July 2018) Mr. Srivata M.K. (from 20^th July 2018) and Mr. Manoj Khullar (Managing Director).

9. DIRECTORS'' RESPONSIBILITY STATEMENT

In pursuance of section 134 (3) (c) of the Companies Act, 2013, the Directors here by confirm that:

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

(b) the directors have selected such accounting policies and applied them consistently and made judgments and estimates that 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 and loss of the company for that period;

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

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

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

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

10. SECRETARIAL STANDARDS

The Directors state that all applicable Secretarial Standards issued by the Institute of Company Secretaries of India relating to meetings of Board of Directors and General Meetings have been duly followed by the Company.

11. FRAUD REPORTING BY AUDITORS

As required under Section 134(3) (ca) of the Companies Act, 2013, there are no instances of Fraud being reported by the Auditors.

12. DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS

The Company has received necessary declaration from each Independent Director of the Company under Section 149 (7) of the Companies Act, 2013 that the Independent Directors of the Company meet with the criteria of their Independence laid down in Section 149(6).

13. DIRECTORS AND KEY MANANGERIAL PERSONNEL

In accordance with the provision of the Companies Act, 2013 Mr. Ian Brown, Director of the Company, retire by rotation and being eligible, offer himself, for re-appointment. The profiles of the Director seeking re-appointment form part of the Annexure to the Notice.

Mr. Arun Roy and Mr. Sanjeev Mukerjee resigned as Directors with effect from 31^st May 2017. Ms. Sze Wee Ong and Ms. Valdirene Licht, resigned as Directors with effect from 9^th January 2018 and 16^th January 2018 respectively. Your Directors place on record their sincere appreciation of the valuable contribution made by them during their tenure as Directors of the Company.

The Board of Directors appointed Mr. Boon Tong Koh and Mr. YockJeng Goh as an Additional Director to hold office as Director of the Company with effect from 28^th May 2018 Mr. Koh and Mr. Goh shall hold office as Director upto the date of the forthcoming Annual general meeting of the Company.

During the year, Mr. Guo Lin ceased to be Alternate Director to Ms. Sze Wee Ong with effect from 9^th January 2018. He was appointed as an Alternate Director to Mr. YockJeng Goh under the Companies Act, 2013 with effect 28^th May 2018.

The Board of Directors of the Company on the recommendation of Nomination and Remuneration Committee at their meeting held on 28^th May 2018 and 19^th July 2018 have, sought to reappoint Mr. Manoj Khullar as Managing Director, for a further period of 3 (Three) years, effective 1^st July 2018 and appoint Mr. Srivatsa M K as an additional Director and also as Executive Director for a period of 3 (Three) years, effective 19^th July 2018. The Board seeks members'' approval for appointment of Mr. Manoj Khullar as Managing Director and Mr. Srivatsa M K as Executive Director of the Company.

Details of the proposal of Directors seeking appointment/reappointment are mentioned in the Explanatory Statement under Section 102 of the Companies Act, 2013 of the Notice of the 31^st Annual General Meeting.

None of the Directors is disqualified from being appointed as Directors as specified in Section 164(2) of the Companies Act, 2013.

The Company has recognized pursuant to Sections 2 (51) and 203 of the Companies Act 2013, Mr. Manoj Khullar, Managing Director, Mr. Chidananda Bhagwat, Director, Mr. Srivatsa M K, Director, Mr. Rajeev Gupte, Chief Financial Officer and Mr. Amit Kumashi Company Secretary of the Company as Key Managerial Personnel of the Company.

14. ANNUAL EVALUATION

Pursuant to the provisions of the Companies Act, 2013 the Board has carried out an annual performance evaluation of its own performance, of the Directors individually, as well as the evaluation of the working of its Committees. The Independent Directors have evaluated the performance of the non-independent Directors and the Board as a whole. They also assessed the quality, quantity and flow of information between Company''s management and the Board which is essential for the Board to effectively and reasonably perform their duties.

Based on the evaluation, Company expects the Board and other Directors evaluated to continue to play a constructive and meaningful role in creating value for all the stakeholders in the ensuing years.

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

The Company has in place Policy on Directors Appointment and Remuneration. The Policy has been published on the Company''s website https://www.solvayindia.in/en/solvay-in/Sunshield-Policies.html.

Prior to the induction of the director on the Board, the Managing Director briefs the incoming director about the Company, its line of business, and the composition of the present board organization chart etc. The appointment letter issued to the independent directors also sets out detailed terms of employment including their roles, function, responsibilities and their fiduciary duties, code of conduct, performance evaluation process etc. as a director of the Company.

Independent directors have a right to access information and documents for enabling them to have a good understanding of the Company and its various operations.

16.RISK MANAGEMENT POLICY AND INTERNAL CONTROL ADEQUACY

The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. These are discussed at the meetings of the Audit Committee and the Board of Directors of the Company.

The Company''s internal control systems are commensurate with the nature of its business and the size and complexity of its operations. These are routinely tested and certified by Statutory as well as Internal Auditors. Significant audit observations and follow up actions thereon are reported to the Audit Committee.

17. VIGIL MECHANISM

The Company has established a vigil mechanism named as Whistle Blower Policy within the Company. The policy of such mechanism has been circulated to all employees within the Company, which provides a framework to the employees for guided & proper utilization of the mechanism. The Whistle Blower Policy has been placed on the Company''s website http://www.solvayindia.in/en/solvay-in/sunshield-chemical-limited

18. SIGNIFICANT AND MATERIALS ORDERS PASSED BY THE REGULATORS/ COURTS/ TRIBUNALS

No significant or material orders were passed by the Regulators or Courts or Tribunals which impacts the going concern status and Company''s operation s in future. There have been no instances of any personnel seeking access to the Audit Committee.

19. AUDITORS

Statutory Auditors

The Statutory Auditors, M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, continue to hold office for the remaining term of their appointment till 2019. In accordance with the Companies Amendment Act, 2017, Section 139 as amended was enforced from 7^th May, 2018 by the Ministry of Corporate Affairs. As per the said amendment, appointment of auditors is not required to be ratified at every Annual General Meeting.

The necessary certificate section 139 of the Companies Act, 2013 inter alia indicating the fulfillment of the criteria provided under Section 141 of the Companies Act, 2013 has been issued by the Statutory Auditors.

Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, on the recommendations of the Audit Committee, the Board the Company had appointed M/s. Kishore Bhatia & Associates, Cost Accountant as the Cost Auditor of the Company for the financial year 2017-18. The ratification of the fee payable to the Cost auditors is sought from the Members in the ensuing Annual General Meeting. The cost audit report will be filed within the period stipulated under the Act.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. Alwyn D''Souza & Co., Company Secretaries to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is annexed herewith as Annexure B. The Report does not contain any qualification, reservation or adverse remark.

Internal Auditors

M/s. Nikhil Narkar & Associates, Chartered Accountants has been appointed as Internal Auditor of the Company.

20. COMMENTS ON AUDITORS'' REPORT

There are no qualifications, reservations or adverse remarks or disclaimers made by Deloitte Haskins & Sells LLP, Statutory Auditors, in their report and by Mr. Alwyn D''souza, Company Secretary in Practice, in his secretarial audit report.

21. EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as Annexure C.

22. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186

The Company has not provided any loans, Guarantees or made investments under Section 186 of the Companies Act, 2013

23. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SECTION 188(1)

All Related Party Transaction (RPT) entered into by the Company during the year under review were in the ordinary course of business and on arms'' length basis.

All RPT are placed before the Audit Committee for its review and approval. Prior omnibus approval of the Audit Committee is obtained for transactions which are of repetitive nature. Pursuant to the provisions of the Listing Regulations 2015 as well as the Rule 6A of the Companies (Meetings of Board and its Power) Rules 2014, Audit Committee had granted omnibus approval for the proposed RTP to be entered into during the year under review. Since there are no material RTP and also all the transactions with related parties are at arms'' length and are in ordinary course of business, no transactions need to be reported in AOC-2. Note No.38 in the note to accounts provide the details on the related party transactions.

24. FIXED DEPOSITS

The Company has not accepted any fixed deposits during the year There are no deposits which are outstanding as on 31^st March, 2018.

25. SUBSIDIARY. ASSOCIATES AND TOINT VENTURES

The Company does not have any subsidiary or associates or joint ventures as on the date of this report. Therefore separate section for report on the performance and financial position of Subsidiaries, Associates and Joint Venture Companies is not required.

26.TRANSFER OF SHARE TO IEPF DEMAT ACCOUNT

Since the Company has not declared the provision pertaining to transfer of shares on which dividend was unclaimed/unpaid for seven years to Investor Education and Protection Fund (IEPF) Authority is not applicable to the Company.

27. MATERIAL CHANGES AND COMMITMENTS . AFFECTING THE FINANCIAL POSITION OF . THE COMPANY

Implementation of Voluntary Retirement Scheme

After end of Financial Year but before the date of Report, the Company has announced a Voluntary Retirement Scheme (VRS) for all its permanent Executives and Workers as per the scheme. The financial impact of VRS will be incorporated in financials of 2018-19.

28. EMPLOYEES

The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, is annexed herewith as Annexure D.

29. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION. PROHIBITION. REDRESSAL) ACT 2013

The Company has in place Prevention of Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition, Redressal) Act, 2013.

The internal committee is set up to redress complaints received regarding sexual harassment. All employees are covered under this Policy. The following is the summary of sexual harassment complaints received and disposed off during the Financial Year 2017-18:

Number of Complaints of sexual harassment received during the period April 2017 to March 2018	Number of complaints disposed off during the period April 2017 to March 2018	Nature of action taken by the employer
Nil	Not applicable	Not applicable

30. CONSERVATION OF ENERGY. TECHNOLOGY . ABSORPTION AND FOREIGN EXCHANGE . EARNINGS AND OUTGO

As required by Section 134 (3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, relevant data pertaining to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo, is annexed herewith as Annexure E to this Report.

31. CORPORATE GOVERNANCE REPORT

Regulation 15 (2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 with respect to Corporate Governance report and certain regulations are not applicable to Sunshield Chemicals Limited ("Company"), since Company''s paid-up Capital is less than Rs. 10 crores and net worth is less than Rs. 25 crores.

32. ENVIRONMENT. HEALTH AND SAFETY

Your Company recognizes importance of Health and Safety of its employees and its neighborhood. Regular Safety Audits are being conducted. Your Company has adopted a Health, Safety and Environment (HSE) Policy, which applies to all employees and activities.

33. APPRECIATION

Your Directors place on record their sincere appreciation of the wholehearted support extended by the Company''s bankers, business associates, employees'' union, shareholders, auditors and various statutory authorities, both, central and state Government.

For and on behalf of the Board of Directors

R L Shenoy

Chairman

Mumbai, 1 9^th July 2018 ^{DIN Na 0074761}

Phoenix House,

''A'' Wing, 4^th Floor,

462 Senapati Bapat Marg,

Lower Parel (West), Mumbai-400013

Mar 31, 2016

Dear Members,

The Directors are pleased to submit their 29^th Annual Report of the Company along with the Audited financial statements for the year ended 31^st March 2016:

1. OVERVIEWOFFINANCIALRESULTS

Highlights of Company''s performance during the financial year 2015-16, is as under:

(Rs,In Lacs)

	2015-16	2014-15
Export Sales	8139	6509
Domestic Sales (Net of Excise Duty)	6798	5346
Other Operating Income	86	45
Revenue from Operations	15023	11900
Other Income	304	69
Total Income	15327	11969
Less : Materials Consumed	10060	8627
Employees Remuneration & Benefits	667	630
Manufacturing, Administrative, Selling & Other Expenses	3315	2428
Total Expenses	14042	11685
Operating Profit (EBITDA)	1285	284
Less: Finance Cost	1080	349
Profit Before Tax & Depreciation (Cash Profit)	205	(65)
Less: Depreciation	548	326
Net Profit Before Tax	(343)	(391)
Less: Tax Expense Current Tax Expense Tax adjustments relating to prior years Deferred Tax (Credit)/Charge	4 (263)	17 (90)
Net Loss after Tax	(84)	(318)

2. DIVIDEND

In view of losses, the Board of Directors does not recommend any dividend for the year ended 31^st March 2016.

3. SHARECAPITAL

The paid up Equity Share Capital as on 31^st March, 2016 was '' 7.35 Crores. During the year under review, the Company has not issued new shares.

4. MANAGEMENT''S DISCUSSION AND ANALYSIS : F.Y. 2015-2016

I. Industry Structure & Development :-

Our customers represent a wide range of Industries such as Wire Insulation Enamel, PVC stabilizers, Inks, Colours, Coatings, Textiles, Agro Chemicals, Polymers, Plastics, Rubber, Latex, Tyre and Tubes, Conveyor Belts, Lubricants, Additives, Home care, Cosmetic, Soaps detergents, Fertilizers and many more.

Customers are always expanding and they want to up-grade their products and all these improvements need Company''s R&D and niche formulation and application knowledge & experience. Solvay represents this worldwide knowledge base in specialty chemicals supporting the Sunshield team.

Company''s main products belong to:

a. Specialty Surfactant applications, which are predominantly Ethylene Oxide (EO) based products. The technologies developed involve surfactants, Esters, Amides, and other complementary processes.

b. Specialty Anti-Oxidants for Lubricants, Polymers, Rubber, Tyre & Latex and other Industries involving Aminic & Phenolic technologies and

c. Other Non-EO technologies & customized blends for various applications.

II. Operating and Financial Performance of the

Company

(Rs, In Lacs)

	F.Y. 2015 - 2016	F.Y 2014 - 2015	Change over Previous year
i) Exports	8139	6509	25%
ii) Domestic	7628	6184	23%
iii) Other Operating Income	86	45	91%
Gross Sales	15853	12738	24%
Less: Excise Duty	830	838
Net Sales	15023	11900	26%
Other Income	304	69	341%
Total Income	15327	11969	28%

	F.Y. 2015 - 2016	F.Y. 2014 - 2015	Change over Previous year
Volume Sales (MT)	10446	8576	22%
Net Sales Value (Rs,)	15023	11900	26%
Average Product Price ('' per kg)	144	139	4%

During the year, Sales by Volume went up by 22% from 8576 Mt. to 10446 Mt. the sales in Value terms went up by 26%. The growth was contributed by increase in average selling price of its products from Rs, 139 per kg to Rs, 144 per kg.

Export Sales went up by 25% from Rs, 6509 lacs to Rs, 8139 lacs and domestic Sales went up by 23% from Rs, 6184 lacs in 2014-15 to Rs, 7628 lacs in 2015-16.

During the year, the Company had sold its property situated at Dadar for a total consideration ofRs, 550 lacs thereby earning a profit of Rs,117 lacs on sale of property.

EBIDTA was up by 352% at Rs, 1285 lacs in the year 2015-16 against EBIDTA ofRs, 284 lacs in the previous year.

Finance Cost went up from Rs, 349 lacs in 2014-15 to Rs, 1080 lacs in 2015-16, mainly on account of increase in interest cost and Foreign Exchange losses. Interest cost increased on account of borrowings to finance the capital expenditure. The capital expenditure incurred was during 2014-15 but it was commissioned in 2015-16.

Cash profit (Profit before Tax & Depreciation) was at Rs, 205 lacs in the year 2015-16 as compared to loss of Rs, 65 lacs in the year 2014-15.

III. Outlook

Solvay is actively involved in planning and implementing the current capital expenditure through its worldwide professional teams for Products and Project development. The Company now has its Rasal production site upgraded to Solvay standards of safety and efficiency for a multi-product niche specialty product range.

The CompanyRs,s products continue to be well received by World''s leading users of specialty chemicals for a diverse range of industrial applications. The Company has been recognized as a reputable and dependable supplier to many Indian and global consumers of specialty products developed in-house.

IV. Risks and Concerns

The Present and future risks are reviewed by the management of the Company at regular intervals. Major risks identified by the business and functions are systematically addressed through mitigating actions on continuous basis. These are discussed at Audit Committee and Board of Directors Meetings. Following risks are considered as high risks areas:

i Foreign Exchange Fluctuations

ii. Procurement Risk

iii. Competition Risk

Major Risk arises from main raw material viz., Ethylene Oxide (EO). EO is currently consistently available from only one manufacturer in the country. Some of the major raw materials are hazardous and inflammable. The Company has ensured that Safety equipment''s and infrastructure are in place as per statues and global safety standards.

In addition to above, the Company feels that slowdown in world economies, will affect demand from user industry specifically and lower overall demand, can bring pressures all over and the aggressive pricing can cause concerns about margins.

V. Internal Financials Controls and its adequacy

Internal Checks and Controls covering operations of the Company are in place and are constantly being improved upon. The Company had laid down internal financial controls to be followed by the Company and such policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.

VI. Human Resources

Employee relationships at all levels continued to be satisfactory. The management would like to record its appreciation of dedicated and strong support provided to your Company, by its employees at all levels. During the year under review, the Company successfully entered into wage settlement agreement with workers of the Company. The number of employees on rolls as on 31^stMarch 2016 is 98.

5. BOARDMEETINGS

The Board meets at regular intervals to discuss and decide on Company / business policy and strategy apart from other Board business.

The Board met four times in the financial year 2015-16 i.e on 23^rdMay 2015, 12^th August 2015, 4^th November 2015 and 9^th February 2016.

6. BOARDCOMMITTEES

During the year, in accordance with the Companies Act, 2013, the Board re-constituted some of its Committees. There are currently six Committees of the Board, which are given below:

- Audit Committee

Audit Committee includes five Directors viz., Mr. Ajit Shah (Chairman/Independent Director), Mr. Sanjeev Mukerjee (Independent Director), Mr. Ranjal Laxmana Shenoy (Independent Director), Mr. Manoj Khullar (Managing Director) and Mr. Satish Kelkar (NonExecutive Director).

The role includes oversight of Company''s financial reporting process and disclosure of financial information to ensure that the financial statements are correct, sufficient and credible; recommending the appointment, re-appointment, remuneration and terms of appointment of auditors and approval of payment for any other services rendered by statutory auditors; reviewing with the management quarterly results and annual financial statements before submission to the Board for approval; approval or any subsequent modification of any transactions of the Company with related parties; review and monitor the auditor''s independence and performance and effectiveness of audit process; scrutiny of inter corporate loans and investments, if any; evaluation of internal financial controls and risk management system; and reviewing the functioning of the whistle blower mechanism.

- Nomination and Remuneration Committee

The Board has constituted Nomination and Remuneration Committee which comprises of three Independent Directors viz. Mr. Ranjal Laxmana Shenoy, Mr. Ajit Shah and Mr. Sanjeev Mukerjee.

- Stakeholders'' Relationship Committee

Stakeholders Relationship Committee comprises of Mr. Sanjeev Mukerjee (Independent Director), Mr. Ajit Shah (Independent Director) and Mr. Manoj Khullar (Managing Director).

The Committee focuses primarily on monitoring and ensuring that all shareholder and investor services operate in an efficient manner and that shareholder and investor grievances / complaints including that of all other stakeholders are addressed promptly with the result that all issues are resolved rapidly and efficiently.

- Corporate Social Responsibility Committee

The Board has constituted Corporate Social Responsibility Committee comprising of Mr. Ajit Shah (Independent Director), Mr. Arun Roy (Non-Executive Director) and Mr. Manoj Khullar (Managing Director).

The Committee focuses on formulation and Review of CSR policy indicating activities to be undertaken by the Company; recommendation of the amount of expenditure to be incurred on CSR activities and monitoring and implementing this policy from time to time.

The CSR policy of the Company and Annual Report on CSR activities is annexed herewith as Annexure A.

- Risk Management Committee

The Board has constituted Risk Management Committee comprising of Mr. Arun Roy (Non -Executive Director), Mr. Manoj Khullar (Managing Director) and Mr. Chidananda Bhagwat, (Operation Manager).

The role of Risk Management Committee includes reviewing and approving the risk management policies of the Company; assessment and monitoring of all risks associated with the operations of the Company and development and implementation of internal compliance and control systems and procedures to manage risk.

- Committee for Issue of Duplicate Share Certificates

The Board has constituted a Committee for the purpose of issuance of duplicate share certificates. The Committee comprises of two Non-Executive Directors, Mr. Arun Roy, Mr. Satish Kelkar and Mr. Manoj Khullar, Managing Director.

7. DIRECTORS'' RESPONSIBILITYSTATEMENT

In pursuance of section 134 (3)(c) of the Companies Act, 2013, the Directors hereby confirm that:

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

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

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

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

8. FRAUDREPORTINGBYAUDITORS

As required under Section 134(3) (ca) of the Companies Act, 2013, there are no instances of Fraud being reported by the Auditors.

9. DECLARATION FROM INDEPENDENT DIRECTORS ONANNUALBASIS

The Company has received necessary declaration from each Independent Director of the Company under Section 149(7) of the Companies Act, 2013 that the Independent Directors of the Company meet with the criteria of their Independence laid down in Section 149(6).

10. DIRECTORS AND KEYMANANGERIAL PERSONNEL

In accordance with the provision of the Companies Act, 2013 Mr. Ian Brown and Ms. Sze Wee Ong, Directors of the Company, retire by rotation and being eligible, offer themselves, for re-appointment. The profiles of the Directors seeking re-appointment form part of the Annexure to the Notice.

During the year Mr. Yogesh Thar and Mr. Pierre Franck Valentin resigned as Directors with effect from 30^th September 2015 and 29^th February 2016 respectively. Mr. Chen Pu ceased to be Alternate Director to Mr. Pierre Franck Valentin with effect from 29^th February 2016. Your Directors place on record their sincere appreciation of the valuable contribution made by them during their tenure as Directors of the Company.

The Board of Directors appointed Mr. Ajit Shah as an Additional Director to hold office as an Independent Director of the Company with effect from 20^thOctober 2015 and Ms. Valdirene Licht as Additional Director with effect from 15^th March 2016.

Mr. Shah and Ms. Licht shall hold office of Director up to the date of the forthcoming Annual general meeting of the Company. The Company has received a notice in writing from a member along with the deposit of requisite amount under Section 160 of the Act proposing the candidature each of Mr. Shah and Ms. Licht for the office of Director of the Company.

Details of the proposal for appointment of Ms. Valdirene Licht and Mr. Ajit Shah are mentioned in the Explanatory Statement under Section 102 of the Companies Act, 2013 of the Notice of the 29^th Annual General Meeting.

None of the Directors is disqualified from being appointed as Directors as specified in Section 164(2) of the Companies Act, 2013.

The Company has recognized pursuant to Sections 2 (51) and 203 of the Act, Mr. Manoj Khullar, Managing Director, Mr. RajeevGupte, Chief Financial Officer and Mr. Amit Kumashi, Company Secretary of the Company as Key Managerial Personnel of the Company.

11. ANNUAL EVALUATION

Pursuant to the provisions of the Companies Act, 2013 the Board has carried out an annual performance evaluation of its own performance, the Directors individually, as well as the evaluation of the working of its Committees. The Independent Directors have evaluated the performance of the working Directors and the Chairman of the Company

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

In accordance with Section 178 of the Companies Act, 2013 the Nomination and Remuneration Committee has formulated Remuneration Policy ("the policy").

The objective of the policy is to ensure that Executive Directors and other employees are sufficiently compensated for their performance. The Policy seeks to provide criteria for determining qualifications, positive attributes and independence of a director.

REMUNERATION POLICY Directors

Nomination and Remuneration Committee shall recommend the remuneration, including the commission based on the net profits of the Company for the Non-Executive Directors and Managing Director and other Executive Directors. This will be then approved by the Board and shareholders. Prior approval of shareholders will be obtained wherever applicable in case of remuneration to non-executive directors.

The Company pays remuneration by way of salary, perquisites and allowances (fixed component) and variable pay to Managing Director. Salary is paid within the range approved by the Shareholders. Annual increments effective 1^st January each year, as recommended by the Nomination and Remuneration Committee, and is approved by the Board. Within the prescribed ceiling, the perquisites package is approved by the Remuneration Committee.

The remuneration paid to Executive Directors is determined keeping in view the industry benchmark and the relative performance of the Company to the industry performance. Perquisites and retirement benefits are paid according to the Company policy as applicable to all employees.

Independent Non-Executive Directors are appointed for their professional expertise in their individual capacity as independent professionals / Business Executives. Independent Non-Executive Directors receive sitting fees for attending the meeting of the Board and Board Committees and commission as approved by the Board and shareholders.

The remuneration by way of commission paid to the Independent Non-Executive directors is determined periodically & reviewed based on the industry benchmarks.

Key Managerial Personnel and Other Employees

The remuneration of employees largely consists of basic salary, perquisites, allowances and performance incentives. Perquisites and retirement benefits are paid according to the Company policy, subject to prescribed statutory ceiling.

The components of the total remuneration vary for different grades and are governed by the industry pattern, qualification & experience / merits, performance of each employee. The Company while deciding the remuneration package takes into consideration current employment scenario and remuneration package of the industry.

The annual variable pay of managers is linked to the performance of the Company in general and their individual performance for the relevant year measured against Company''s objectives fixed in the beginning of the year.

CRITERIA FOR BOARD MEMBERSHIP

Directors

The Company shall take into account following points:

- Director must have relevant experience in Finance/ Law/ Management/ Sales/ Marketing/ Administration/ Research/Corporate Governance/ Technical Operations or the other disciplines related to company''s business.

- Director should possess the highest personal and professional ethics, integrity and values.

- Director must be willing to devote sufficient time and energy in carrying out their duties and responsibilities.

Independent Director

Independent Director is a director who has no direct or indirect material relationship with Sunshield or any of its officers, other than as a director or shareholder of Sunshield.

Independent Director shall meet all criteria specified in Section 149(6) of the Companies Act, 2013 and rules made there under.

13. RISK MANAGEMENT POLICY AND INTERNAL CONTROLADEQUACY

14. VIGILMECHANISM

The Company has established a vigil mechanism named as Whistle Blower Policy within the Company. The policy of such mechanism has been circulated to all employees within the Company, which provides a framework to the employees for guided & proper utilization of the mechanism. The Whistle Blower Policy has been published on the Company''s website http://www.solvayindia.in/en/solvay-in/sunshield-chemical-limited. There have been no instances of any personnel seeking access to the Audit Committee.

15. SIGNIFICANTAND MATERIALS ORDERS PASSED BY THE REGULATORS/COURTS/TRIBUNALS

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

16. AUDITORS Statutory Auditors

The Statutory Auditors, M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, hold office for a term of Five (5) years subject to ratification by members at every Annual General Meeting. Accordingly, a Resolution seeking Member''s ratification for the appointment of M/s. Deloitte Haskins & Sells LLP is included at Item No. 4 of the Notice convening the Annual General Meeting.

They have issued necessary certificate as required under Section 141 of the Companies Act, 2013.

Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the Company has appointed M/s. Kishore Bhatia & Associates, Cost Accountant as the Cost Auditor of the Company for the financial year 2015-16.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed

M/s. Alwyn D''Souza & Co., Company Secretaries to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is annexed herewith as Annexure B. The Report does not contain any qualification, reservation or adverse remark.

Internal Audit

M/s. Nikhil Narkar & Associates, Chartered Accountants has been appointed as Internal Auditor of the Company.

17. COMMENTSONAUDITORS''REPORT

18. EXTRACTOFANNUALRETURN:

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as Annexure C.

19. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186

The Company has not provided any loans, Guarantees or made investments under Section 186 of the Companies Act, 2013

20. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SECTION 188(1)

During the financial year 2015-16, Company has entered into transactions with related parties, which were in the ordinary course of business and on arms'' length basis and in accordance with the provisions of the Companies Act, 2013, Rules issued there under.

The details of the related party transactions as required under Accounting Standard - 18 are set out in Note 26.9 to the financial statements forming part of this Annual Report.

The Form AOC- 2 pursuant to Section 134 (3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is annexed herewith as Annexure D.

21. FIXEDDEPOSITS

The Company has not accepted any fixed deposits during the year.

22. MATERIAL CHANGES AND COMMITMENTS AFFECTING THEFINANCIALPOSITIONOF THECOMPANY

There have been no material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report.

23. EMPLOYEES

24. SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

The status of complaints received from female employees with regard to sexual harassment during the year is as under:

Number of Complaints of sexual harassment received during the period April 2015 to March 2016	Number of complaints disposed off during the period April 2015 to March 2016	Nature of action taken by the employer
NIL	Not applicable	Not applicable

governance is applicable to Sunshield Chemicals Limited ("Company"), since Company''s paid-up Capital is less than Rs, 10 crores and net worth is less than Rs, 25 crores.

27. ENVIRONMENT, HEALTH AND SAFETY

28. APPRECIATION

For and On Behalf of the Board of

Directors R L Shenoy

Chairman

DIN No. 0074761

Mumbai, 30^thMay 2016

Mar 31, 2015

Dear Members,

The Directors are pleased to submit their 28th Annual Report and Audited Accounts for the year ended 31st March 2015:

1. OVERVIEWOF FINANCIAL RESULTS

Highlights of Company's performance during the financial year 2014-15, is as under:

(Rs. In Lac)

2014-15 2013-14

Export Sales 6509 7786

Domestic Sales 5346 5547

(Net of Excise Duty)

Other Operating Income 45 32

Revenue from Operations 11900 13365

Other Income 69 38

Total Income 11969 13403

Less :

Materials Consumed 8627 9594

Employees Remuneration 629 499 & Benefits Manufacturing,

Administrative, Selling &

Other Expenses 2428 2184

Total Expenses 11685 12277

Operating Profit (EBITDA) 285 1126

Less: Finance Cost 349 357

Profit Before Tax & Depreciation (Cash Profit) (64) 769

Less: Depreciation 327 230

Net Profit Before Tax (391) 539

Less: Tax Provision (73) 579

Net Loss after Tax (318) (40)

2. MAJOR PLANT SHUDOWN: For long-term sustainable site in India at Solvay Global Standards

A major Plant Shutdown was undertaken for upgradation of plantfora period of 103 days beginning with 15th December 2014 and ending on 28th March 2015.

During the shutdown period, the Company had taken up major CAPEX Plan of Rs. 40.17 crores - a rise of about 113% from Rs. 36.71 crores in 2013-14 to Rs. 78.31 crores in 2014-15.

In view of the above, performance of current year could not see an upward trend compared to previous year.

However, the upgradation after the Shutdown has achieved the following long-term strengths:

- Solvay Global Standards of Safety with respect to storage and handling of Ethylene Oxide and other related products.

- Higher capacity of Electrical Transformer makes the site further expandable.

- Change from Manual Control System to Distributed Control System - Automation.

- Higher storage capacity of Ethylene Oxide Condensates (EOC) products.

- Improved quality control and development laboratories.

3. DIVIDEND

In view of losses, the Board of Directors does not recommend any dividend for the year ended 31st March 2015.

4. SHARECAPITAL

The paid up Equity Share Capital as on 31st March, 2015 was Rs. 7.35 Crores. During the year under review, the Company has not issued newshares.

5. MANAGEMENT'S DISCUSSION AND ANALYSIS : F.Y. 2014-2015

(Pursuant to Clause 49 of the Listing Agreement with BSE Limited)

The Company is operating only in one Segment, namely 'Specialty Chemicals'.

I. Industry Structure & Development :-

Your Company manufactures a wide range of specially formulated and customized products for various Industrial applications. Company's customers are well recognized and located not only in India but all over the World especially in the America, Europe, and Far- East.

Our customers represent a wide range of Industries such as Wire Insulation Enamel, PVC stabilizers, Inks, Colours, Coatings, Textiles, Agro Chemicals, Polymers, Plastics, Rubber, Latex, Tyre and tubes, Conveyor belts, Lubricants, Additives, Home care, Cosmetic, soaps detergents, Fertilizers and many more.

Customers are always expanding and they want to up- grade their products and all these improvements need Company's R&D and niche formulation and application knowledge & experience. Solvay represents this worldwide knowledge base in specialty chemicals supporting the Sunshield team.

Company's main products belongto:

a. Specialty Surfactant applications, which are predominantly Ethylene Oxide (EO) based products. The technologies developed involve surfactants, Esters, Amides, and other complementary processes.

b. Specialty Anti-Oxidants for Lubricants, Polymers, Rubber, Tyre & Latex and other Industries involvingAminic& Phenolic technologies and

c. Other Non-EO technologies & customized blends for various applications.

A number of Surfactants and specialty chemicals formulated by the Company depend on EO, which is currently commercially produced and sold in India by only one Supplier. However the supplier has 3 independent production sites viz., at Nagothane, Baroda and Dahej. This multi-location option, gives a reasonable dependability of EO supplies for the Company. Managing logistics of EO procurement is a key factor of operations.

In recent upgradation at our factory, the storage capacity of EO is increased by over 40%. In addition, the site has been upgraded to Solvay global standards of Environment, Health, safety and efficiency.

Solvay is actively involved in planning and implementing the current CAPEX through its worldwide professional teams for Products and Project development. The Company now has its Rasal production site upgraded to Solvay standards of safety and efficiency for a multi-product niche specialty product range.

II. Operating and Financial Performance of the Company

(Rs. In Lacs)

F.Y. F.Y. 2014-2015 2013-2014

i) Exports 6509 7786

ii) Domestic 6077 6128

iii) Processing Charges 107 111

iv) Other Operating Income 45 32

Gross Sales 12738 14057

Less: Excise Duty 838 692

Net Sales 11900 13365

Net Loss after Tax (318) (40)

The Sales in Value terms went down by 11%. Export Sales went down by 16% from Rs. 7786 Lacs to Rs. 6509 Lacs and domestic Sales went down by 1%from Rs. 6128 Lacs in 2013-14 to Rs. 6077 Lacs in 2014-15.

EBIDTA was down by 75% atRs. 285 Lacs in the year 2014-15 against EBIDTA ofRs. 1126 Lacs in the previous year.

Finance Cost came down from Rs. 357 Lacs in 2013-14 to Rs. 349 Lacs in 2014-15, a drop of 2% over that of previous year.

Cash profit (Profit before Tax & Depreciation) went down by 108% from Rs. 769 Lacs in the year 2013-14 to loss ofRs. 64 Lacs in the year 2014-15.

The above adverse performance is mainly on account of major shutdown of 103 days as detailed earlier.

III. Outlook

The Company's products continue to be well received by World's leading users of specialty chemicals for a diverse range of industrial applications. The Company has been recognized as a reputable and dependable supplier to many Indian and global consumers of specialty productsdeveloped in-house.

Now that Sunshield is a Solvay group Company with access to management, goodwill and global customer base, it is accepted as efficient and dependable global supplier and provides service worldwide.

With the implementation of Capex plan of Rs. 40.17 crores during 2014-15, the Company has a very positive out-look for growth in exports as also domestic.

IV. Risks and Concerns

i. Slowdown in world economies, affect demand from user industry specifically in Europe.

ii. Lower overall demand, can bring pressures all over and the aggressive pricing can cause concerns about margins.

V. Internal Control System and its adequacy

During the year, no significant internal control issue was identified. Internal checks and controls appropriate to growing size of the Company's business, is being put in place.

VI. Human Resources

Employee relationships at all levels continued to be satisfactory. The management would like to record its appreciation of dedicated and strong support provided to your Company, by its employees at all levels. The number of employees on rolls as on 31st March 2015 is 106.

(The statement in this report including Management's Discussions & Analysis Report reflects Company's projections, estimates, expectations or predictions. These may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied, since your Company's operations are influenced by many external and internal factors beyond the control of the Company.)

6. BOARDMEETINGS

The Board meets at regular intervals to discuss and decide on Company / business policy and strategy apart from other Board business.

The Board metfour times in the financial year 2014-15 i.e on 23rd May 2014,12th August 2014,14th November 2014 and 13th February 2015.

7. BOARDCOMMITTEES

During the year, in accordance with the Companies Act, 2013, the Board re-constituted some of its Committees and also formed Corporate Social Responsibility Committee, Risk Management Committee and Committee for issue of Duplicate Share Certificates. There are currently six Committees of the Board, as follows:

- AuditCommittee

- Nomination and Remuneration Committee

- Stakeholders' Relationship Committee

- Corporate Social Responsibility Committee

- RiskManagementCommittee

- Committee for Issue of Duplicate Share Certificates

Details of all the Committees are provided in the

"Report on Corporate Governance", a part of this

Annual Report.

8. DIRECTORS' RESPONSIBILITY STATEMENT

In pursuance of section 134 (5) of the Companies Act,

2013, the Directors hereby confirm that:

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

(b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;

(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

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

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

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

9. FRAUD REPORTING BY AUDITORS

As required under Section 134(3)(ca)of the Companies Act, 2013, there are no instances of Fraud being reported by the Auditors.

10. DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS

The Company has received necessary declaration from each Independent Director of the Company under Section 149(7) of the Companies Act, 2013 that the Independent Directors of the Company meet with the criteria of their Independence laid down in Section 149(6).

11. DIRECTORS AND KEY MANANGERIAL PERSONNEL

In accordance with the provision of the Companies Act, 2013 Mr. Manoj Khullar and Mr. Satish Kelkar, Directors of the Company, retire by rotation and being eligible, offer themselves, for re-appointment. The profiles of the Directors seeking re-appointment form part of the Annexuretothe Notice.

Mr. Michel Ybert, Mr. Suresh Talwar resigned as Directors with effect from 14th November 2014 and 16th February 2015 respectively. Your Directors place on record their sincere appreciation of the valuable contribution made by them during their tenure as Directors of the Company.

The Board of Directors appointed Ms. Sze Wee Ong and Mr. Arun Roy as Additional Directors with effect from 14th November, 2014 and 1st July 2015 respectively. The Board of Directors appointed Mr. Ranjal Laxmana Shenoy as an Additional Director to hold office as an Independent Director of the Company with effect from 20th March 2015.

Ms. Ong, Mr. Roy and Mr. Shenoy hold office of Director upto the date of the forthcoming Annual general meeting of the Company. The Company has received a notice in writing from a member along with the deposit of requisite amount under Section 160 of the Act proposing the candidature each of Ms. Ong, Mr. Roy and Mr. Shenoy for the office of Director of the Company.

During the year, Mr. Guo Lin ceased to be Alternate Director to Mr. Michel Ybert with effect from 14th November, 2014. He was appointed as an Alternate Director to Ms. Sze Wee Ong under the Companies Act, 2013 with effectfrom the same date.

Details ofthe proposal for appointment of Ms. Sze Wee Ong, Mr. Ranjal Laxmana Shenoy, Mr. Arun Roy and Mr. Manoj Khullar are mentioned in the Explanatory Statement under Section 102 of the Companies Act, 2013 ofthe Notice ofthe 28th Annual General Meeting.

The Board of Directors in their meeting held on 23rd May 2015, accepted the resignation of Mr. Shrirang Belgaonkar, Wholetime Director with effectfrom 30th June 2015. Your Directors place on record their sincere appreciation ofthe contribution made by him during histenure asa member ofthe Board.

The Board of Directors of the Company on the recommendation of Nomination and Remuneration Committee at their meeting held on 23rd May 2015 have, soughttoappointMr. Manoj Khullar as Managing Director, for a period of 3 (Three) years, effective from 1st July 2015. The Board seeks members' approval for appointment of Mr. Manoj Khullar as Managing Director ofthe Company.

None of the Directors is disqualified from being appointed as Directors as specified in Section 164(2) of the Companies Act, 2013.

The Company has recognized Mr. Manoj Khullar, Managing Director, Mr. Rajeev Gupte Chief Financial Officer and Mr. Amit Kumashi Company Secretary of the Company as Key Managerial Personnel as required underSection 203 ofthe Companies Act, 2013.

12. ANNUAL EVALUATION

Pursuant to the provisions ofthe Companies Act, 2013 and Clause 49 ofthe Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the Directors individually, as well as the evaluation ofthe working of its Committees.

13. COMPANY'S POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION

In accordance with Section 178 ofthe Companies Act, 2013 the Nomination and Remuneration Committee has formulated Remuneration Policy ("the policy").

The objective of the policy is to ensure that Executive Directors and other employees are sufficiently compensated for their performance. The Policy seeks to provide criteria for determining qualifications, positive attributes and independence of a director.

REMUNERATION POLICY

Directors

Nomination and Remuneration Committee shall recommend the remuneration, including the commission based on the net profits ofthe Company for the Non-Executive Directors and Wholetime Director and other Executive Directors. This will be then approved by the Board and shareholders. Prior approval of shareholders will be obtained wherever applicable in case of remuneration to non-executive directors.

The Company pays remuneration by way of salary, perquisites and allowances (fixed component) and variable pay to Wholetime Director. Salary is paid within the range approved by the Shareholders. Annual increments effective 1st January each year, as recommended by the Nomination and Remuneration Committee, and is approved by the Board. Within the prescribed ceiling, the perquisites package is approved by the Remuneration Committee.

The remuneration paid to Executive Directors is determined keeping in view the industry benchmark and the relative performance of the Company to the industry performance. Perquisites and retirement benefits are paid according to the Company policy as applicable to all employees.

Independent Non-Executive Directors are appointed for their professional expertise in their individual capacity as independent professionals / Business Executives. Independent Non-Executive Directors receive sitting fees for attending the meeting of the Board and Board Committees and commission as approved by the Board and shareholders.

The remuneration by way of commission paid to the Independent Non-Executive directors is determined periodically & reviewed based on the industry benchmarks.

Key Managerial Personnel and Other Employees

The remuneration of employees largely consists of basic salary, perquisites, allowances and performance incentives. Perquisites and retirement benefits are paid according to the Company policy, subject to prescribed statutory ceiling.

The components of the total remuneration vary for different grades and are governed by the industry pattern, qualification & experience / merits, performance of each employee. The Company while deciding the remuneration package takes into consideration current employment scenario and remuneration package ofthe industry.

The annual variable pay of managers is linked to the performance of the Company in general and their individual performance for the relevantyear measured against Company's objectives fixed in the beginning of the year.

CRITERIA FOR BOARD MEMBERSHIP

Directors

The Company shall take into account following points:

- Director must have relevant experience in Finance/ Law/ Management/ Sales/ Marketing/ Administration/Research/Corporate Governance/ Technical Operations or the other disciplines related to company's business.

- Director should possess the highest personal and professional ethics, integrity and values.

- Director must be willing to devote sufficient time and energy in carrying out their duties and responsibilities.

Independent Director

Independent Director is a director who has no director indirect material relationship with Sunshield or any of its officers, other than as a director or shareholder of Sunshield.

Independent Director shall meetall criteria specified in Section 149(6) ofthe Companies Act, 2013 and rules made thereunder and Clause 49 of the Listing Agreement entered into with BSE Limited.

14. RISK MANAGEMENT POLICY AND INTERNAL CONTROLADEQUACY

The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. These are discussed at the meetings ofthe Audit Committee and the Board of Directors ofthe Company.

The Company's internal control systems are commensurate with the nature of its business and the size and complexity of its operations. These are routinely tested and certified by Statutory as well as Internal Auditors. Significant audit observations and follow up actions thereon are reported to the Audit Committee.

15. VIGILMECHANISM

The Company has established a vigil mechanism named as Whistle Blower Policy within the Company. The policy of such mechanism has been circulated to all employees within the Company, which provides a framework to the employees for guided & proper utilization of the mechanism. The Whistle Blower Policy has been published on the Company's website http://www.solvayindia.in/en/solvay-in/sunshield- chemical-limited. There have been no instances of any personnel seeking access to the Audit Committee.

16. AUDITORS

Statutory Auditors

The Statutory Auditors, M/s. Deloitte Haskins & Sells LLP Chartered Accountants, hold office for a term of Five (5) years subject to ratification by members at every Annual General Meeting. Accordingly, a Resolution seeking Member's ratification for the appointment of M/s. Deloitte Haskins & Sells LLP is included at Item No. 4 of the Notice convening the Annual General Meeting.

They have issued necessary certificate as required under Section 141 of the Companies Act, 2013.

CostAuditors

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the Company has appointed M/s. Kishore Bhatia & Associates, Cost Accountant as the Cost Auditor of the Company for the financial year 2014-15.

Cost Audit Report for the year 2013-14 was filed with the Ministry of Corporate Affairs on 12th August 2014 in XBRL format. Cost Audit Report for the financial year 2014-15 shall be filed with the Ministry of Corporate Affairs within 180 days from the closure of the financial year i.e. on or before 27thSeptember 2015.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. Alwyn D'Souza & Co., Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed herewith asAnnexure A. The Report does not contain any qualification, reservation or adverse remark.

Internal Audit

M/s. Nikhil Narkar & Associates, Chartered Accountants has been appointed as Internal Auditor of the Company.

17. COMMENTS ON AUDITORS' REPORT

There are no qualifications, reservations or adverse remarks or disclaimers made by Deloitte Haskins & Sells LLP, Statutory Auditors, in their report and by Mr. Alwyn D'souza, Company Secretary in Practice, in his secretarial audit report.

18. EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as Annexure B.

19. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186

The Company has not provided any loans, Guarantees or made investments under Section 186 of the Companies Act, 2013

20. PARTICU LARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SECTION 188(1)

During the financial year 2014-15, Company has entered into transactions with related parties, which were in the ordinary course of business and on arms' length basis and in accordance with the provisions of the Companies Act, 2013, Rules issued thereunder and Clause 49 of the Listing Agreement. During the financial year 2014-15, there were no transactions with related parties which qualify as material transactions under the ListingAgreement.

The details of the related party transactions as required under Accounting Standard - 18 are set out in Note

27.9 to the financial statements forming part of this Annual Report.

The Form AOC- 2 pursuant to Section 134 (3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is annexed herewith as Annexure C.

21. CORPORATE SOCIAL RESPONSIBILITY

The Company has constituted a Corporate Social Responsibility (CSR) Committee in accordance with Section 135 of the Companies Act, 2013. The CSR policy of the Company and Annual Report on CSR activities is annexed herewith as Annexure D.

22. FIXED DEPOSITS

The Company has not accepted any fixed deposits during the year.

23. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There have been no material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report.

24. EMPLOYEES

The information required pursuantto Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, is annexed herewith as Annexure E.

25. SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

There were no incidences of sexual harassment reported during the year under review, in terms of the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

26. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGSANDOUTGO

As required by Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, relevant data pertaining to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo, is annexed herewith as Annexure F to this Report.

27. CORPORATEGOVERNANCE REPORT

The Corporate Governance Report for the financial year 2014-15 is set out as a separate Annexure to this Report. Certificate from the Practicing Company Secretary, certifying, compliance with Clause 49 of the Listing Agreement with the Stock Exchange in respect of Corporate Governance is annexed to the Report on Corporate Governance.

28. ENVIRONMENT, HEALTH AND SAFETY

Your Company recognizes importance of Health and Safety of its employees and its neighborhood. Regular Safety Audits are being conducted. Your Company has adopted a Health, Safety and Environment (HSE) Policy, which applies to all employees and activities.

29. APPRECIATION

Your Directors place on record their sincere appreciation of the wholehearted support extended by the Company's bankers, business associates, employees' union, shareholders, auditors and various statutory authorities, both, central and state Government.

For and On Behalf of the Board of Directors

R L Shenoy Chairman

Mumbai, 15th July 2015

Mar 31, 2014

Dear Members,

The Directors are pleased to submit their 27th Annual Report and Audited Accounts for the year ended 31st March 2014, also incorporating Management''s Discussion and Analysis of performance of your Company:

A. overview of Financial Results

Highlights of Company''s performance during the financial year 2013-14, is as under:

(Rs. In Lacs)

2013- 2012- Change 2014 2013 over previous years

Export Sales 7927 6307 26%

Domestic Sales 5463 4223 29% (Net of Excise Duty) Revenue from

Operations 13390 10530 27%

Other Income 78 20 62%

Total Income 13468 10550 28%

Less :

Materials Consumed 9610 7559 27%

Employees Remuneration & Benefits 499 468 7%

Manufacturing, Administrative, Selling & Other Expenses 2141 1662 29%

Total Expenses 12250 9689 27%

Operating Profit 1218 861 41% (EBITDA)

Less: Finance Cost 449 510 (12%)

Profit Before Tax & Depreciation (Cash Profit) 769 351 119%

Less: Depreciation 230 248 (7%)

Net Profit Before Tax 539 103 423%

Less: Tax Provision Current Tax 115 21

Deferred Tax 693 (2)

MAT Credit Entitlement (229) -

Net Profit/(Loss) after tax (40) 84 (52%)

B. Management''s Discussion and Analysis: F.Y. 2013-2014

(pursuant to Clause 49 of the listing Agreement with the Stock exchange, Mumbai)

The Company is operating only in one Segment, namely ''Specialty Chemicals''.

I. Industry Structure & Development:

Your Company manufactures process chemicals that are formulated to meet requirements of industries and are known as "Specialty Chemicals" (SC). Specialty Chemicals manufactured by the Company fnd extensive use in diverse range of Industries such as Wire Insulation Enamel, PVC stabilizers, Inks, Colours, Coatings, Textiles, Agro-chemicals, Plastics, Rubber and Latex, Tyre and Tubes, Lubricant and additives, and many more.

Some of these SC are Ethylene Oxide (EO) based derivatives, called Ethylene Oxide Condensates (EOC). For the EOC industry, EO is a vital input. EO is a product manufactured mainly for captive consumption by petrochemical complexes to produce MEG, a vital input for Polyester Fibre industry. Based on the captive requirements, petrochemical complexes allocate EO to EOC industry. EO is non importable by sea/air on account of transportation hazards because of its characteristics of low boiling point and explosive nature. EO, therefore needs to be transported at controlled temperatures and under Nitrogen pressure, in specially designed road tankers. EOC Industry therefore depends entirely on domestic EO availability and Prices.

Besides, EOC based Specialty Chemicals; Company has also diversifed into the manufacture of a range of Anti-Oxidants and certain other additives, which do not use EO. This range of products is also required by a diverse group of industries in the feld of Lubricants, Additives, Plastics, Polymers, Rubber, Tyre, Resins and other industries.

The Company is presently catering to the requirements of both the ranges of SC, for large domestic Companies and prime MNCs operating in North and South America; Germany, France, Italy, Netherlands, Turkey etc. in Europe; and also in Asian markets like Korea, Taiwan, Malaysia, Japan etc.

II. operating and Financial performance of the Company

(Rs. In Lacs)

F.Y. F.Y. Change 2013-2014 2012-2013 over Previous year

(i) Exports 7927 6307 26%

(ii) Domestic 6155 4878 26%

Gross Sales 14082 11185 26%

Less: Excise 692 655 6% Duty

Net Sales 13390 10530 27%

F.Y. F.Y. Change over 2013-2014 2012-2013 Previous year

Volume Sales 9703 8146 19% (MT)

Net Sales 13390 10530 27% Value (Rs.)

During the year, Sales by Volume went up by 19% from 8146 Mt to 9703 Mt.

The Sales in Value terms went up by 27%. Export Sales went up by 26% from Rs. 6307 lacs to Rs. 7927 lacs and Domestic Sales went up by 26% from Rs. 4878 lacs in 2012-13 to Rs. 6155 lacs in 2013-14.

EBIDTA was up by 41% at Rs. 1218 lacs in the year 2013-14 against EBIDTA of Rs. 868 lacs in the previous year.

Finance Cost came down from Rs. 510 lacs in 2012-13 to Rs. 449 lacs in 2013-14, a drop of 12% over that of previous year.

Cash profit (profit before Tax & Depreciation) went up by 119% from Rs. 351 lacs in the year 2012-13 to Rs. 769 lacs in the year 2013-14.

After provision of depreciation of Rs. 230 lacs for 2013-14 (Rs. 248 lacs for 2012-13. Net profit before Tax provision went up from Rs. 103 lacs to Rs. 539 lacs a rise of 423%.

However, as a matter of abundant caution and prudence, in addition to provision of current year''s Income tax, a provision for MAT credit entitlement and revision on Deferred Tax has been made having final effect that post tax provision, the Net profit after Tax came down from Rs. 84 lacs in 2012-13 to a loss of Rs. 40 lacs for 2013-14.

III. outlook

Your Company is already recognized globally, as a reliable supplier of quality Specialty Chemicals, for a variety of end use applications. Your Company is reasonably optimistic to further improve its performance in the current year. Your Company''s products range continues to be accepted all over the world and now Sunshield being of Solvay group has a strong presence worldwide, resulting in 26% growth in domestic as also export business.

With the Company''s strength to implement Environment Health and Safety upgrades at Rasal production site to meet Solvay''s Global standards, the Company plans to take up Capex plan (amounting to Equivalent to US $ 8 million, for which Reserve Bank of India approval has been already received) for these up-grades as also capacity increase and diversifcation, bringing long term sustainable growth path for the Company.

IV. Risks and Concerns:

(i) Slow down in world economies, affect demand from user industry Specifically in Europe.

(ii) Lower overall demand, can bring pressures all over and the aggressive pricing can cause concerns about margins.

V. Internal Control System and its adequacy:

During the year, no significant internal control issue was identified. Internal checks and controls appropriate to growing size of Company''s business, is being put in place.

VI. Human Resources:

Employee relationships at all levels continued to be satisfactory. The management would like to record its appreciation of dedicated and strong support provided to your Company, by its employees at all levels.

(the statement in this report including Management''s Discussions & Analysis Report refects Company''s projections, estimates, expectations or predictions. these may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied, since your Company''s operations are infuenced by many external and internal factors beyond the control of the Company.)

C. Dividend

In view of losses, the Board of Directors does not recommend any dividend for the year ended 31st March 2014.

D. Directors

The Board of Directors at their meeting held on 23rd May 2014 have, sought to reappoint Mr. Shrirang Belgaonkar as Wholetime Director, for a further period of 3 (Three) years, effective from 24th July 2014. The Board seeks approval for re-appointment of Mr. Shrirang Belgaonkar as Wholetime Director of the Company.

On notifcation of Section 149 and other applicable provisions of Companies Act, 2013, your Directors are seeking appointment of Mr. Suresh Talwar, Mr. Yogesh Thar and Mr. Sanjeev Mukerjee as Independent Directors for five consecutive years for a term upto 31st March 2019. Details of the proposal for appointment of Mr. Suresh Talwar, Mr. Yogesh Thar and Mr. Sanjeev Mukerjee are mentioned in the Explanatory Statement under Section 102 of the Companies Act, 2013 of the Notice of the 27th Annual General Meeting.

In accordance with the provision of the Companies Act, 2013 Mr. Ian Brown and Mr. Pierre Frank Valentin, Directors of the Company, retires by rotation and being eligible, offers themselves, for re-appointment.

The profles of the Directors seeking re-appointment forms part of the Annexure to the Notice.

None of the Directors is disqualified from being appointed as Directors as specified in Section 164(2) of the Companies Act, 2013.

e. Directors'' Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, it is hereby confirmed:

(i) that in the preparation of the accounts for the financial year ended 31st March 2014, the applicable accounting standards have been followed along with proper explanation relating to material departures.

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgment and estimates that were reasonable and prudent so as to give a true and fair view of the profit or loss of the Company for the year under review;

(iii) that the Directors have taken proper and suffcient care for the maintenance of adequate accounting records in accordance with the provision of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

F. Fixed Deposits

The Company has not accepted any fixed deposits during the year.

G. Auditors

M/s. Ashok Pandit & Co., Chartered Accountants, Auditors of the Company, will retire at the conclusion of the 27th Annual General Meeting and are not seeking re-appointment for the next year.

The Board of Directors at its Board Meeting held on 23rd May 2014 has appointed M/s. Deloitte Haskins & Sells LLP, as Statutory Auditors of the Company. They have issued necessary certifcate as required under Section 141 of the Companies Act, 2013. The Board recommends their appointment.

H. Cost Audit

Cost Audit Report for the year 2012-13 was fled with the Ministry of Corporate Affairs on 26th August 2013 in XBRL format.

M/s. Kishore Bhatia & Associates, Cost Accountant has been appointed as the Cost Auditor of the Company under section 233B of the Companies Act, 1956 for the financial year 2013-14. Cost Audit Report for the financial year 2013-14 shall be fled with the Ministry of Corporate Affairs within six months from the closure of the financial year i.e. on or before 30th September 2014.

I. employees

During the year under review there were no employees, whose particulars are to be given under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 in this Report.

The status of complaints received from female employees with regard to sexual harassment during the year is as under:

J. Conservation of energy, technology Absorption and Foreign exchange earnings and outgo

As required by Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, relevant data pertaining to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo, are given as Annexure to this Report.

K. Corporate Governance Report

The Corporate Governance Report is set out as a separate Annexure to this Report. Certifcate from the Auditors of the Company, certifying, compliance with Clause 49 of the Listing Agreement with the Stock Exchange in respect of Corporate Governance is annexed to the Report on Corporate Governance.

l. environment, Health and Safety

Your Company recognizes importance of Health and Safety of its employees and its neighborhood. Regular Safety Audits are being conducted. Your Company has adopted a Health, Safety and Environment (HSE) Policy, which applies to all employees and activities. Company is planning to take major upgradation on Safety, Health and Environment to further higher standards of Safety, Health and Environment in accordance with Policies on Safety, Health and Environment of Solvay Group.

M. Appreciation

Your Directors place on record their sincere appreciation of the wholehearted support extended by the Company''s bankers, business associates, employees'' union, shareholders, auditors and various statutory authorities, both, central and state Government.

For and on Behalf of the Board of Directors

Mumbai, Suresh Talwar

23rd May 2014 Chairman

Mar 31, 2013

Dear Members,

The Directors are pleased to submit their 26th Annual Report and Audited Accounts for the year ended 31st March, 2013, also incorporating Management''s Discussion and Analysis of performance of your Company:

A. Overview of Financial Results

Highlights of Company''s performance during the fnancial year 2012-13, is as under:

(Rs.In Lacs)

2012- 2011- Change 2013 2012 over previous years

Export Sales 6307 4938 28%

Domestic Sales (Net 4223 4490 (6%) of Excise Duty)

Revenue from 10530 9428 12%

Operations

Other Income 20 93 (78%)

Total Income 10550 9521 11%

Less :

Materials Consumed 7559 6817 11%

Employees

Remuneration & Benefts 468 390 20%

Manufacturing, Administrative, Selling & Other Expenses 1655 1457 14%

Total Expenses 9682 8664 12%

Operating Proft 868 857 1%

(EBITDA)

Less: Finance Cost 510 550 (7%)

Proft Before Tax & Depreciation (Cash Proft) 358 307 17%

Less: Depreciation 248 224 11%

Net Proft Before Tax 110 83 33%

Less: Tax Provision 19 (14)

Net Proft after Tax 91 97 (6%)

B. Acquisition of Majority Stake in the Company by Rhodia Amines Chemicals Pte. Ltd. (Part of Solvay Group)

During the year the Agreement for the Sale and Purchase of shares in Sunshield Chemicals Limited was executed between the Company, its erstwhile Promoters and Rhodia Amines Chemicals Pte. Ltd. (part of Solvay S.A. group, Belgium)

In terms of the said Agreement, Rhodia Amines Chemicals Pte. Ltd. on 26th December, 2012 acquired 45,85,196 Equity shares of Rs. 10/- each representing 62.36% Equity Shares in the Company as per the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations 2011.

Solvay S.A. is an international chemical group committed to sustainable development with a clear focus on innovation and operational excellence. It generates over 90% (ninety per cent) of its sales in markets where it is among the top three leaders. Solvay S.A. offers a broad range of products that contribute to improving the quality of life and the performance of its customers in markets such as consumer goods, construction, automotive, energy, water and environment, and electronics.

C. Dividend

In order to conserve resources, the Board of Directors does not recommend any dividend for the year ended 31st March, 2013.

D. Directors

The Board at its meeting held on 27th December,

2012 had appointed Mr. Suresh Talwar, Mr. Ian Brown, Mr. Yogesh Thar, Mr. Sanjeev Mukerjee, Mr. Michel Ybert, Mr. Pierre-Franck Valentin, and Mr. Manoj Khullar as Additional Directors.

As per the Provision of Section 260 of the Companies Act, 1956, these Directors hold offce only up to the date of forthcoming Annual General Meeting of the Company.

The Board at its meeting held on 13th February,

2013 had appointed Mr. Chen Pu and Mr. Guo Lin as Alternate Director to Mr. Pierre Franck Valentin and Mr. Michel Ybert respectively.

With effect from 27th December, 2012 Mr. Amit Choksey, Mr. Ashok Datar, Mr. Bipin Jhaveri, Mr. Dhiren Mehta, Mr. Manubhai Patel and Mr. Sandeep Junnarkar relinquished their offce. Your Directors express their appreciation for the valuable services rendered by them during their tenure.

In accordance with the provision of the Companies Act, 1956 read with Article 166 of the Articles of Association of the Company, Mr. Satish Kelkar, Director of the Company, retires by rotation and being eligible, offers himself, for re-appointment.

The profles of the Directors seeking re- appointment forms part of the Annexure to the Notice.

None of the Directors are disqualifed from being appointed as Directors as specifed in Section 274(1)(g) of the Companies Act, 1956.

F. Directors'' Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, it is hereby confrmed:

(i) that in the preparation of the accounts for the fnancial year ended 31st March, 2013, the applicable accounting standards have been followed along with proper explanation relating to material departures.

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgment and estimates that were reasonable and prudent so as to give a true and fair view of the proft or loss of the Company for the year under review;

(iii) that the Directors have taken proper and suffcient care for the maintenance of adequate accounting records in accordance with the provision of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

G. Fixed Deposits

The Company has not accepted any fxed deposits during the year. During the year, the Company has fully repaid fxed deposits. There has been no default in payment of interest on or repayment of these deposits.

H. Shifting of the Registered Offce of the Company

With effect from 15th January, 2013, the Registered Offce of the Company has been shifted from N.K.M. International House, 178, Backbay Reclamation, Babubhai Chinai Marg, Mumbai - 400 020 to Phoenix House, 4th Floor, 462, Senapati Bapat Marg, Lower Parel (West), Mumbai - 400 013.

I. Auditors

M/s. Tembey & Mhatre, Chartered Accountants, Auditors of the Company, will retire at the conclusion of the 26th Annual General Meeting and are not seeking re-appointment for the next year.

The Board of Directors vide its resolution dated 5th June, 2013, passed by circulation, has appointed M/s. Ashok Pandit & Co., as Statutory Auditors of the Company. They have issued necessary certifcate as required under Section 224 (1B) of the Companies Act, 1956. The Board recommends their appointment.

J. Cost Compliance Report

Cost Compliance Report for the year 2011-12 was fled with the Ministry of Corporate Affairs on 31st January, 2013 in XBRL format.

K. Cost Audit

M/s. Kishore Bhatia & Associates, Cost Accountant has been appointed as the Cost Auditor of the Company under section 233B of the Companies Act, 1956 for the fnancial year 2012-13. Cost Audit Report for the fnancial year 2012-13 shall be fled with the Ministry of Corporate Affairs within six months from the closure of the fnancial year i.e. on or before 30th September 2013.

L. Particulars of Employees

During the year under review there were no employees, whose particulars are to be given under Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 in this report.

M. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings And Outgo

As required by Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, relevant data pertaining to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo, are given as Annexure to this Report.

N. Corporate Governance Report

The Corporate Governance Report is set out as a separate Annexure to this Report. Certifcate from the Auditors of the Company, certifying, compliance with Clause 49 of the Listing Agreement with the Stock Exchange in respect of Corporate Governance is annexed to the Report on Corporate Governance.

O. Environment, Health and Safety

Your Company recognizes importance of Health and Safety of its employees and its neighborhood. Regular Safety Audits are being conducted. Your Company has adopted a Health, Safety and Environment (HSE) Policy, which applies to all employees and activities. Company is planning to take major upgradation on Safety, Health and Environment to further higher standards of Safety, Health and Environment in accordance with Policies on Safety, Health and Environment of Solvay Group.

P. Appreciation

Your Directors place on record their sincere appreciation of the wholehearted support extended by the Company''s bankers, business associates, employees'' union, shareholders, auditors and various statutory authorities, both, central and state Government.

For and On Behalf of the Board of Directors

Mumbai, Suresh Talwar

7th June, 2013 Chairman

Mar 31, 2012

The Directors are pleased to submit their 25th Annual Report and Audited Accounts for the year ended 31st March, 2012, also incorporating Management's Discussion and Analysis of performance of your Company:

A OVERVIEW OF FINANCIAL RESULTS

Highlights of Company's performance during the financial year 2011-12, is as under:

(Rs. in Lacs)

2011-2012 % to Net 2010-2011 % to Net Change over Sales Sales Previous year

Gross Sales 10069 Ã 8492 Ã 19%

Net Sate by volume (MT) 8062 Ã 7972 Ã 1%

Net Sates 9429 Ã 7914 Ã 19%

Other income 93 Ã 65 Ã

Total Income 9522 Ã 7979 Ã 19%

Less : Materials Consumed 6817 72% 5539 70% 23%

Employees Remuneration & Benefits 390 4% 327 4% 19%

Manufacturing, Administrate , 1458 15% 1247 16% 17% Setting & Other Expenses

Total Expenses 8665 19% 7112 20% 22%

Operating Prett (EBITDA) 857 9% 867 11% (1%)

Less: Finance Cost 550 6% 410 5% 34%

Prom Before Tax 4 Depredation 307 3% 457 6% (33%) (cash profit)

Less; Depreciation 224 2% 193 2% 16%

Net Profit before Tax 83 Ã 264 Ã (68%)

Less: Tax Provision

Income Tax (18) Ã (51) Ã

Deferred Tax 31 Ã (54) Ã

Net Profit after Tax 97 Ã 159 Ã (39%)

B MANAGEMENT DISCUSSION AND ANALYSIS: F.Y. 20H-2012

(Pursuant to Clause 48 of the Listing Agreement with the Stock Exchange, Bombay)

L The Company is operating only in one Segment, namely 'Specialty Chemicals'.

L Industry Structure & Development :-

Your Company manufactures process chemicals that are formulated to meet requirements of industries and are known as "Specialty Chemicals" (SC)

Specialty Chemicals manufactured by the Company find extensive use in diverse range of Industries, such as Wire Insulation Enamel, PVC stabilizers, Inks, Colours, Coatings, Textiles, Agro-chenricats, Plasties, Rubber and Latex, Tyre and Tubes, Lubricant and additives, and many more- Some of these SC are Ethylene Oxide (EO) based derivatives, catted Etttytene Oxide Condensates (EOC). For the EOC industry, EO is a vital input. EO is a product manufactured mainly for captive consumption by petrochemical complexes to produce MEG, a vilal input for Polyester Fibre industry. Based on the captive requirements, petrochemical complexes allocate EO to EOC industry. EO is non importable by sea im on account of transportation hazards because of its characteristics of low boiling point and explosive nature. EO, therefore needs to be transported at controlled temperatures and under Nitrogen pressure, in specially designed road tankers. EOC Industry therefore depends entirely on domestic EO avatebtlity and Prices.

Besides, EOC based Specialty Chemicals; Company has also diversified into the manufacture ot a range of Anti-Oxidants and certain other additives, which do not use EO. This range of products is also required by a diverse group of industries in the field of Lubricants, Additives, Plastics, Polymers, Rubber, Tyre, Resins and other industries.

The Company is presently catering to the requirements of both the ranges of SC, for large domestic Companies and prime MNCs operating in North and South America; Germany, France, Italy, Netherlands, Turkey etc. in Europe; and also in Asian markets like Korea, Taiwan, Malaysia, Japan etc.

III. Operating and Financial Performance of the Company

Sales / Pressures on Margins (Rs in Lacs)

FY. FY. Change over 2011-2012 2010-2011 Previous year

i) Domestic 4902 4003 22%

ii) Exports 4969 4300 16%

iii) Other Processing Revenue 206 192 7%

Gross Sales 10069 8492 19%

Less: Excise Duty 640 578

Net Sales 9429 7914 19%

Other Income 93 65 43%

Total Income 9522 7979 19%

FY FY. Change over 2011-2012 2010-2011 Previous year

Volume Sales (MT) 8062 7972 1%

Net Sales Value (Rs.) 9429 7914 19%

Average Product Price (Rs. per kg) 117 99 18%

1. During the year, Sales by Volume went up by 1% from 7972 Mt to 8062 Mt. the sales in Value terms went up by 19%. The growth was contributed by increase in average selling price of its products from Rs. 99 per kg to Rs.117 per kg. This increase in average selling price was caused on account of steep increase in landed cost of imported input materials as also adverse foreign exchange rates.

Value of the Materials consumed as percentage of net sales increased by 2%.

2. The Company could not increase selling prices of its key products for sales in the export markets to the extent of increase in the costs of input materials, partly due to earlier commitments and partly due to increase in competition from Chinese manufactures.

3. In addition, one of its foreign customers slowed down its offtake from the Company of a product with good margin for major part of the year. Export of the product has restarted in the current year.

4. Profit Margins were, therefore under pressure.

5. EBIDTA stood at Rs. 8.57 crores in the year 2011-12 against EBIDTA of Rs. 8.67 crores in the previous year, a drop of 2% as percentage to Net Sales.

6. There was a steep increase in Finance Cost to the extent of 34%. Cash profit (Profit before Tax & Depreciation) came down from Rs. 4.57 croresjn the year. 2010-11 to Rs. 3.07 crores in the year 2011 -12.

IV. Outlook

Your Company is already recognized globally, as a reliable supplier of quality Specialty Chemicals, for a variety of end use applications. Company is reasonably optimist to improve its performance in the current year.

This outlook is on account of sustained sales to globally renowned customers and acceptance of Antioxidants of the Company in EU and USA markets.

V. Risks and Concerns:

i. Slow down in world economies, coupled with weakening of rupee, will bring severe pressure on cost of input materials including those based on Naphtha / Crude, which will translate into pressure on profit margins during the current year.

ii. Uncertainties in global economies may affect demand, from some of the overseas customers.

iii. During the year, the Company converted a part of its long term rupee borrowings into FCNR(B) borrowings for achieving interest cost reduction. Volatility of $:Rs. exchange rate may nullify the benefit that would have accrued in interest costs.

VI. Internal Control System and its adequacy:

During the year, no significant internal control issue was identified. Internal checks and controls appropriate to growing size of Company's business, are being introduced. An independent firm of Chartered Accountants is entrusted with the Internal Audit of the Company.

VII. Human Resources:

Employee relationships at all levels continued to be satisfactory. The management would like to record its appreciation of dedicated and strong support provided to your Company, by its employees at all levels.

(The statement in this report including Management's Discussions & Analysis Report reflect Company's projections, estimates, expectations or predictions. These may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied, since your Company's operations are influenced by many external and internal factors beyond the control of the Company.)

C DIVIDEND

In view of the balance accumulated losses, the Board of Directors do not recommend payment of any dividend.

D DIRECTORS

In accordance with the provision of the Companies Act, 1956 read with Article 166 of the Articles of Association of the Company, Shri Satish M Kelkar and Shri Dhiren P. Mehta, Directors of the Company, retire by rotation and being eligible, offer themselves, for re-appointment.

E DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, it is hereby confirmed:

(i) that in the preparation of the accounts for the financial year ended 31st March, 2012, the applicable accounting standards have been followed along with proper explanation relating to material departures.

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgment and estimates that were reasonable and prudent so as to give a true and fair view of the profit or loss of the Company for the year under review;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provision of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

E FIXED DEPOSITS

During the year, the Company has accepted fixed deposits. Fixed deposits from Public and the shareholders stood at Rs. 110 Lakhs at the end of the year. There has been no default in payment of interest on or repayment of these deposits.

G. AUDITORS

M/s. Tembey & Mhatre, Chartered Accountants, Mumbai, hold office upto the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have issued necessary certificate as required under Section 224 (1B) of the Companies Act, 1956. The Board recommends their appointment.

H PARTICULARS OF EMPLOYEES

During the year under review there were no employees, whose particulars are to be given under Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 in this report.

L CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

As required by Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, relevant data pertaining to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo, are given as Annexure to this Report.

J. CORPORATE GOVERNANCE REPORT

The Corporate Governance Report is set out as a separate Annexure to this Report. Certificate from the Auditors of the Company, certifying, compliance with Clause 49 of the Listing Agreement with the Stock Exchange in respect of Corporate Governance is annexed to the Report on Corporate Governance.

K. ENVIRONMENT. HEALTH AND SAFETY

Your Company has adopted a Health, Safety and Environment (HSE) Policy, which applies to all employees and activities. Policy is being continuously updated.

L APPRECIATION

Your Directors place on record their sincere appreciation of the wholehearted support extended by the Company's bankers, business associates, employees' union, shareholders, auditors and various statutory authorities, both, central and state Government. The Directors also place on record their sincere appreciation of the support and cooperation rendered by the employees of the Company at all levels.

For and On Behalf of the Board of Directors

Amit Choksey Shrirang Belgaonkar

Chairman Wholetime Director

Mumbai, 11th May, 2012

Mar 31, 2011

The Directors are pleased to submit their 24th Annual Report and Audited Accounts for the year ended 31st March, 2011 incorporating Managements Discussion and Analysis of performance of your Company:

A. OVERVIEW OF FINANCIAL RESULTS

Highlights of Companys performance during the financial year 2010-11, is as under:

(Rs. in Lakhs)

2010-2011 2009-2010

Gross Sales Rs. 8479 6800

Net Sales Rs. 7901 6450

Net Sale by Volume MT 7230 6661

Other Income Rs. 81 1

Total Income Rs. 7982 6451

Less : Materials Consumed Rs. 5539 4271

Employees Remuneration & Benefits Rs. 327 272

Manufacturing, Admininistrative, Selling & Other Expenses Rs. 1248 989

Total Expenses Rs. 7114 5532

Operating Profit (EBITDA) Rs. 868 919

Less: Interest Rs. 410 355

Profit Before Tax & Depreciation (Cash Profit) Rs. 458 564

Less: Depreciation Rs. 193 181

Net Profit before Tax Rs. 265 383

Less: Tax Provision Rs. 105 78

Net Profit after Tax Rs. 160 305

C. DIVIDEND

In view of the balance accumulated losses, the Board of Directors do not recommend payment of any dividend.

D. DIRECTORS

In accordance with the provision of the Companies Act, 1956 read with Article 166 of the Articles of Association of the Company, Shri Ashok R Datar and Shri Manubhai G Patel, Directors of the Company, retire by rotation and being eligible, offer themselves, for re-appointment.

E. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, it is hereby confirmed:

(i) that in the preparation of the accounts for the financial year ended 31st March, 2011, the applicable accounting standards have been followed along with proper explanation relating to material departures.

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgment and estimates that were reasonable and prudent so as to give a true and fair view of the profit or loss of the Company for the year under review;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provision of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

F . FIXED DEPOSITS

During the year, the Company has accepted fixed deposits. Fixed deposits from Public and the shareholders stood at Rs. 110 Lakhs at the end of the year. There is no default in payment of interest on, or repayment of, any fixed deposits.

G. AUDITORS

M/s. Tembey & Mhatre, Chartered Accountants, Mumbai, hold office upto the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have issued necessary certificate as required under Section 224 (1B) of the Companies Act, 1956. The Board recommends their appointment.

H. PARTICULARS OF EMPLOYEES

During the year under review there were no employees, whose particulars are to be given under Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 in this report.

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

As required by Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, relevant data pertaining to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo, are given as Annexure to this Report.

J. CORPORATE GOVERNANCE REPORT

The Corporate Governance Report is set out as a separate Annexure to this Report. Certificate from the Auditors of the Company, certifying, compliance with Clause 49 of the Listing Agreement with the Stock Exchange in respect of Corporate Governance is annexed to the Report on Corporate Governance.

K. ENVIRONMENT, HEALTH AND SAFETY

Your Company has adopted a Health, Safety and Environment (HSE) Policy, which applies to all employees and activities. Policy is being continuously updated.

L. APPRECIATION

Your Directors place on record their sincere appreciation of the wholehearted support extended by the Companys bankers, business associates, employees union, shareholders, auditors and various statutory authorities, both, central and state Government. The Directors also place on record their sincere appreciation of the support and cooperation rendered by the employees of the Company at all levels.

For and On Behalf of the Board of Directors

Amit Choksey Shreerang Belgaonkar Chairman Wholetime Director

Mumbai, 10th May, 2011

Mar 31, 2010

The Directors are pleased to submit their 23rd Annual Report and Audited Accounts for the year ended 31st March, 2010 along with Managements Discussion and Analysis of performance of your Company:

A OVERVIEW OF FINANCIAL RESULTS

Highlights of Companys performance during the financial year 09-10 are as under.

(Rs. In Lacs) Sr. Particulars 2009-2010 2008-2009 Changeover No. Previous year 1 Gross Sales 6864 6846 0.27% 2 Net Sales 6450 6304 2.32% 3 Other Income 5 66 4 Total Income 6455 6370 1.33% 5 Operating Profit (EBITDA) 919 740 24.19% 6 Interest 355 316 7 Profit before Depreciation and Tax (Cash Profit) 564 424 33.25% 8 Depreciation 181 153 9 Net Profit / (Loss) before Tax 383 271 41.33%

B MANAGEMENTS DISCUSSION AND ANALYSIS:

(Pursuant to Clause 49 of the Listing Agreement with the Stock Exchange)

I. The Company is operating in only one Segment, namely Speciality Chemicals.

II. Industry Structure & Development:-

Your Company manufactures process chemicals that are formulated to meet requirements of various industrial applications and are known as "Speciality Chemicals" (SC)

Some of these Speciality Chemicals are Ethylene Oxide (EO) based derivatives called Ethylene Oxide Condensates (EOC). For the EOC industry, EO is a vital input. EO is a product manufactured mainly for captive consumption by Petrochemical complexes to produce MEG, a vital input for Polyester Fibre industry. Based on the captive requirements and market conditions for "MEG", petrochemicals complexes allocate EO to EOC industry. EOC industry greatly depends on availability and prices of EO for its growth.

The EOC Industry comprises of a larger number of players in the Commodity Ethylene Oxide condensates and a - smaller number concentrating on EO based Speciality Chemicals and others. Your Company is presently in the later group and manufactures, besides EO based Speciality Chemicals, a range of Anti-oxidants and certain other Chemicals, which are not dependent on EO. The range of Antioxidants is required by a diverse group of industries in the field of lubricants, plastics, polymers, rubber, tyre, pesticides, ink, coatings, resins and many other industries.

The Company is presently catering to the requirements of large domestic Companies and prime multinational companies operating in North and South America; in Europe - Germany, France, Italy, Netherlands; and also in Asia - Korea, Taiwan, Malaysia, Japan etc.

III. Operating and Financial Performance during the year 2009-2010

1. In 2009-10, total Net Sales by Volume went up by 18.6% but in rupee terms it was up by 2.32%. Domestic Export details are as follows:

SALES BY Volume (MT) Value (Rs. In crores) 2008-09 2009-10 % 2008-09 2009-10 % Total Net Sales 5616 6661 18.6 63.04 64.50 2.32 Export Sales 2749 2949 7.2 33.59 31.08 (7.47) Domestic Sales 2867 3712 29.5 29.45 33.42 13.48

The growth in Volume Sales was not parallel to growth in value terms on account of:

- Lower Export Sales realisations on account of devaluation of US $ / EURO against Indian Rupee. Export Volume Sales was up by 7.2% but sale value of exports has gone down by 7.47%.

- Similarly in domestic sales, the Sales realisations in Rupee term declined in 2009-10 as compared to 2008-09 prices, resulting in growth in Volume Sales by 29.5% but value growth only at 13.48%.

2. Due to declining raw-material prices and better exchange value of rupee against relevant currencies, material consumption as percentage to Net Sales was lower at 66% in the year 2009-10 as compared to 72% in the previous year, reflecting improved Sales margin per unit of Sales.

3. Operating Profits (EBITDA) of the year stood at Rs. 9.19 crores registering a jump of 24% over that of the previous year. Cash profit went up from Rs. 4.24 crores in the year 2008-09 to Rs. 5.64 Crore in the year 2009-10, an increase of over 30%.

4. With the improved profits, your company brought down its carry forward losses from the peak level of Rs.9.27 crores as at 31st March, 2008 (Rs 5.61 crores as at 31st March 2009) to Rs.2.67 crores as at 31st March, 2010.

5. To meet the increased demand from overseas customers, your company has upgraded its production processes, installed balancing equipments to increase production and introduced new products. Addition to fixed assets during the year 2009-10 was of the order of Rs 4.91 crores.

6. Your Company is no more in default in the payment of Sales tax deferral having been granted a schedule of installments for its repayment by the concerned authorities. The schedule has been strictly adhered to by the Company.

IV. Outlook

With the recognition of the Company as a reliable supplier of quality Speciality Chemicals for a variety of end use application, the Company is reasonably optimist to improve its performance in the current year, despite continuing economic slowdown in the overseas markets.

V. Risks and Concerns:

i. Slow down in world economies, coupled with rupee up valuation may bring in severe competition in the domestic markets from imported Speciality Chemicals.

ii. Uncertainties in international economies may affect the demand from some of the overseas customers. In such situation, export sales may be adversely affected.

iii. Export realizations may be adversely affected if Indian rupee strengthens further against other foreign currencies.

VI. Internal Control System and its adequacy:

During the year, no significant internal control issue was identified. Internal checks and controls appropriate to growing size of companys business are being introduced. An independent firm of Chartered Accountants has been entrusted with Internal Audit of the Company.

VII. Material Development in Human Resources :

Employee relationships at all levels continued to be satisfactory. The management would like to record its appreciation of dedicated and strong support provided to your Company, by its employees, at all levels.

(The statement in this report including Managements Discussions & Analysis Report reflect Companys projections, estimates, expectations or predictions. These may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied, since your Companys operations are influenced by many external and internal factors beyond the control of the Company.)

C. DIVIDEND

In view of the balance accumulated losses, the Board of Directors do not recommend payment of any dividend.

D. DIRECTORS:

In accordance with the provision of the Companies Act, 1956 read with Article 166 of the Articles of Association of the Company, Shri Sandeep H Junnarkar and Shri Bipin V Jhaveri, Directors of the Company, retire by rotation and being eligible, offer themselves, for re-appointment.

E DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, it is hereby confirmed:

(i) that in the preparation of the accounts for the financial year ended 31st March, 2010, the applicable accounting _.,. standards have been followed along with proper explanation relating to material departures. - ÃÂ¦-

(ii) that the Directors have selected such accounting policies and applied them consistently and made judgment and estimates that were reasonable and prudent so as to give a true and fair view of the profit or loss of the Company for the year under review;

(iii)that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provision of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the Directors have prepared the accounts for the financial year ended 31st March, 2010 on a going concern basis.

E FIXED DEPOSITS

During the year, the Company has accepted fixed deposits. Fixed deposits from Public and the shareholders stood at Rs. 110 Lacs at the end of the year. There is no default in payment of interest on, or repayment of, any fixed deposits.

G AUDITORS

M/s. Tembey & Mhatre, Chartered Accountants, Mumbai, hold office upto the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have issued necessary certificate as required under Section 224 (1B) of the Companies Act, 1956. The Board recommends their appointment.

H. PARTICULARS OF EMPLOYEES

During the year under review there were no employees, whose particulars are to be given under Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 in this report.

I. CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

As required by Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, relevant data pertaining to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo, are given as Annexure to this Report.

J. CORPORATE GOVERNANCE REPORT

The Corporate Governance Report is set out as a separate Annexure to this Report. Certificate from the Auditors of the Company, certifying, compliance with Clause 49 of the Listing Agreement with the Stock Exchange in respect of Corporate Governance is annexed to the Report on Corporate Governance.

K. ENVIRONMENT HEALTH AND SAFETY

Your Company has adopted a Health, Safety and Environment (HSE) Policy, which applies to all employees and activities. Policy is being continuously updated.

L APPRECIATION

Your Directors place on record their sincere appreciation of the wholehearted support extended by the Companys bankers, business associates, employees union, shareholders, auditors and various statutory authorities, both, central and state Government. The Directors also place on record their sincere appreciation of the support and cooperation rendered by the employees of the Company at all levels.

For and On Behalf of the Board of Directors AmitChoksey Shreerang Belgaonkar Chairman Wholetime Director Mumbai, 7th May, 2010

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