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Directors Report of Symphony Ltd.

Mar 31, 2017

The Directors are pleased to present the 30th Annual Report of the Company for the financial year ended on March 31, 2017. Consequent to the change of corresponding financial year, the current financial year ended on March 31, 2017 (12 months) figures are not comparable with figures of previous financial year (9 months) ended on March 31, 2016.

1] A) Highlights of Results and State of Company’s Affairs (Rs. in lacs)

Standalone

Consolidated

Particulars

2016-17

2015-16 (9 Months)

2016-17

2015-16 (9 Months)

Revenue from Operations & Other Income

70,378

43,434

81,124

46,644

Profit before Financial Charges, Depreciation & Taxation, Exceptional Items

24,358

17,176

24,080

15,689

Less: Financial Charges

1

8

3

20

Less: Depreciation & Amortisation Expenses

368

219

705

430

Profit before Tax & Exceptional Items

23,989

16,949

23,372

15,239

Add: Exceptional Items

-

-

-

1,247

Profit Before Tax

23,989

16,949

23,372

16,486

Less: Income Tax

6,475

4,589

6,614

4,589

Less: Deferred Tax Liability

201

64

201

64

Less: Provision for tax of earlier years

(3)

(4)

(3)

(4)

Profit After Tax

17,316

12,300

16,560

11,837

Add: Balance as per last year Balance Sheet

24,996

23,221

25,832

24,520

Amount available for Appropriation

42,312

35,521

42,392

36,357

Utilisation for issue of bonus shares

5

-

5

-

Dividend and Dividend Tax (interim dividends)

2,315

10,525

2,315

10,525

Surplus in statement of profit and loss

39,992

24,996

40,072

25,832

B) Key Financials as on March 31, 2017

Consolidated Financial Results

Your Company, along with its subsidiaries, has a global presence. In order to provide an overall view of the comprehensive performance of the group, the Company has prepared consolidated accounts of the holding company and all its subsidiaries, in accordance with the accounting standards that are applicable. The consolidated revenue from operations along with other income stood at RS.81,124 lacs. The profit after tax was RS.16,560 lacs.

The highlights of the key financials are as under:

(Rs. in lacs except share date)

Particulars

Standalone

Consolidated

Equity Share Capital

1,399

1,399

Net worth

45,796

45,899

Book Value Per Equity Share

65

66

Earnings Per Share (EPS)

25

24

Investments

30,692

28,283

Contribution to Exchequer

20,168

20,727

2] Dividend

During the period under review, the Board of Directors has declared three interim dividends aggregating to RS.3.50/- (175%) per share and bifurcation of the same is as under:

Date of Declaration

Interim Dividend Amount per share (in Rs.)

% of Dividend

July 26, 2016

1.50

75

October 25, 2016

1.00

50

February 10, 2017

1.00

50

The Board has recommended a final dividend of RS.1 (50%) per equity share having face value of RS.2 each subject to approval of members at ensuing annual general meeting for the financial year ended on March 31, 2017.

An aggregate dividend for the financial year ended on March 31, 2017 on approval at ensuing annual general meeting would be RS.4.5 (225%) per share as against RS.25 (1,250 %) for the previous year. The total payout including final dividend for the financial year 2016-17 (including dividend distribution tax) would be RS.3,157.45 lacs (previous year RS.10,525 lacs) translating into a dividend pay-out of approx. 19% (previous year 89%).

Shareholders’ Reward Policy

Symphony believes in maintaining a fair balance over a long term period between payout / reward to the shareholders and cash retention. The Company has been conscious of the need to maintain consistency in payout / reward to the shareholders. The quantum and manner of payout / reward to shareholders of the Company shall be recommended by the Board of Directors of the Company.

Method of Payout/Rewards to the Shareholders

A.1 Dividend Distribution Policy

This policy is framed pursuant to Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015 (hereinafter referred to as Listing Regulations).

a) The Company will generally endeavour to distribute to the shareholders up to 50% of its profit after tax (including dividend distribution tax and other taxes as applicable).

b) In rare circumstance of any contingency, acquisition opportunities or other business opportunities or unforeseen circumstances, payout to shareholders may be precluded at the discretion of the Board of Directors.

c) Recommendation with regard to payout to shareholders shall be influenced by various factors including, without limitation, internal factors such as profits earned during the fiscal year, liquidity position, fund requirement for acquisitions, reward to shareholders by corporate actions (like buy back of shares) and external factors such as general market conditions, cost of raising funds from alternate sources, applicable taxes including tax on dividend, exemptions under tax laws available to various categories of investors and future expansion opportunities etc.

d) The retained earnings of the Company shall be utilized for future growth and expansion of business, probable acquisitions, working capital and for meeting unforeseen contingencies.

e) The Company has only one class of shares viz. equity shares.

A.2 Interim Dividend

The Board of Directors may, as and when consider it fit, on the basis of performance, profitability, liquidity and on review of quarterly / half yearly / periodical financial statements declare interim dividend to reward the shareholders.

A.3 Special Dividend

The Company may consider special dividend in exceptional circumstances in such event, the limit as stated in clause 1(a) above may exceed.

B. Bonus Issue

As and when the Company has large accumulated reserves represented by free reserves, securities premium, surplus etc. which are felt more than the requirements of the Company, the Board may consider to utilize such balances towards issuance of bonus equity shares or any other security (ies) as may be permissible under the applicable provisions of the Companies Act, 2013, SEBI Act alongwith applicable regulations thereunder and any other Act as may be applicable.

C. Buy Back

As and when the Company has large accumulate reserves represented by free reserves, security premium, surplus etc. which is also supported by sufficient liquidity in the company, the Board of Directors may consider to carry out Buyback of its equity shares in accordance with the relevant applicable provisions of the Companies Act, 2013, SEBI Act along with applicable regulations thereunder and any other Act as may be applicable.

D. Sub Division / Splitting of Shares

The Board of Directors may also consider to sub divide the equity shares in order to improve the liquidity in the market and to make it more affordable to retail shareholders thereby attracting better participation of retail shareholders in the equity shares of the Company.

3] Material Changes and Commitment

There was no material change and commitment affecting the financial position which occurred between the financial year end and the date of this report.

4] Issuance of Bonus Shares

During the year under review, the Board of Directors had recommended bonus equity shares in proportion of 1 (one) equity share of RS.2 each for every 1 (one) existing equity share of RS.2 each held by the members. Subsequently, the members of the Company at their 29th annual general meeting held on August 31, 2016, had approved the issuance of bonus equity shares.

On September 17, 2016, the Bonus Shares Allotment Committee of the Board has issued and allotted 34,978,500 fully paid bonus equity shares of face value of RS.2 each to the members holding shares of the Company as on the record date i.e. September 15, 2016.

Pursuant to issuance of bonus shares, issued, subscribed and paid up share capital of the Company stands increased to RS.139,914,000 divided into 69,957,000 equity shares of RS.2 each.

5] Operations Review

During the year under review, revenue from operations along with other income on standalone basis stood at RS.70,378 lacs. During the year 2016-17, your Company focussed on further expanding its Dealer and Distributor network to benchmark against some of the most widely distributed consumer durable brands in the country. As a result of this thrust, by end of the year under review, the Company had increased its rural penetration by 260%. Thus, your Company has now become one of the most widely distributed brand in the consumer durable sector in India. The increase in retail network has also been matched by expansion of network of direct dealers, modern retail chain stores, regional retail chains and warehouses across the country.

To ensure better focus on market expansion and better brand and product visibility, your Company has expanded the senior management team in Domestic and International Sales during the year. This has enabled the Company to closely monitor the market trends and proactively plan the marketing strategies rather than reacting to market trends.

Your Company considers After Sales Service as a key differentiator which helps its products to fetch a premium over other brands and wins trade and customer loyalty. During the year, your Company further strengthened its After Sales Service set up by increasing the no. of authorised service centres to about 1000. Your Company has a very large base of existing customers using its products, who require routine maintenance and upkeep. Your Company has identified this as an opportunity to serve its loyal customer base, increase brand loyalty and in the process, enhance revenue through service operations. To enable the service franchisee to provide prompt service to the customer, your Company has developed an App which helps it to track the status of all pending calls on line and ensure 100% customer satisfaction.

Your Company offers the widest range of models in the Air cooler industry in the country. It further strengthened its leadership position by launching “TOUCH” range of air coolers with unique features never seen before. This was received very well by the trade and customers and has become one of the bestselling ranges in the very first year of launch. Apart from five models of Touch range, 8 new models were also introduced to cater to various needs of the customers putting your Company much ahead of its competitors.

Like in the past, this year also, your Company continued its aggressive advertisement and promotional campaigns over print, electronic and digital media. Your Company commanded more than 56 % Share of Voice (Source: BARC) in the Air cooler advertising, making it the most visible brand in electronic and on line media.

During the year under review, your Company introduced various steps to win dealer loyalty including a key initiative of launching an app ‘SYMPARK, aimed at rewarding the retailer for his continued loyalty and motivating him to push Symphony products over other brands. This has been a huge success, and has helped your Company in maintaining its No. 1 position with an increased market share, despite many new entrants flocking the market.

Modern Trade

During the period under review, your Company continued to be aggressive in top line products sales through large format stores, retail chains, e-commerce portals and TV shopping channels.

Your Company could maintain its number one position in modern trade, registering a healthy growth and commanding higher market share.

Your Company’s products are well received in all major modern trade stores and continue to be the preferred brand across all regions.

Central Air Cooling Solutions

The Central Air Cooling Solutions business has moved from strength to strength through focused efforts, increased manpower and improved nation-wide dealer network.

The new range added from China with complete in-built controller and motor has created lot of excitement, and response has been more positive than expected. This has the makings of futuristic product, which is feature packed.

During the year under review, your Company focussed on approaching customers in various customer segments directly. The Company executed numerous prestigious orders including those from Tata Steel, Indian Railways, Exide Industries, Ghadi Detergent, TVS Tyres, Marino Laminates, CPWD, NIT Nagpur and many other prestigious clients. Your Company continued to make inroads into various customer segments with approvals from some key opinion makers like HVAC consultants and large MEP contractors. During the period under review, your Company continued with many business development activities through advertisements in newspapers, journals, TV channels and participation in exhibitions.

Your Company’s Packaged Air Coolers are compact, easy-to-install and are meant for midsize spaces such as commercial, industrial and residential areas. They have gained momentum and have been received very well in the market. The campaign has resulted in increased awareness about Central Air Cooling Solutions.

Your Company hopes to reap the benefits of these steps in the years to come.

Air Coolers - Overseas Business

Revenues from overseas business during the year under review increased to RS.72 Crores. Your Company strengthened its senior management team in India and abroad and entered 10 new Countries during the year under review. These markets, along with the existing ones, offer ample opportunities for your Company to build a platform for a rapid expansion of its customer base in the years to come.

Though revaluation of Rupee offers some challenges, your Company is confident of building and strengthening its International distribution network to generate higher volumes.

SEZ Units

During the year under review, your Company continues to operate in two Special Economic Zone (i) Kandla SEZ at Gandhidham, Kutch, Gujarat and (ii) Surat SEZ at Sachin, Surat, Gujarat. The operations at both SEZ units remain satisfactory. It may be noted that the SEZ units enjoy a number of direct and indirect tax benefits including benefits under new foreign trade policy.

Overseas Operations - Impco S. de R. L. de C.V. Mexico

The “Project Renovation” started in 2014-15 has progressed quite well. Accordingly many of the activities have been outsourced and surplus assets have been monetised and IMPCO is gradually becoming asset-light, capital-light business model in line with Symphony India. This has resulted into:

1. Complete debt free status of Impco (Internal debt fully repaid with interest, there was never any external debt).

2. Improved operational efficiency.

3. Managing working capital requirement on its own.

4. Lean Manufacturing operations.

5. More focus on design, innovation, branding and marketing.

6] Overseas Operations -Guangdong Symphony Keruilai Air Coolers Co. Ltd. (GSK), China

The year under review was the first full operating year after acquisition with effect from January 1, 2016. The operating loss during the calendar year 2016 as compared to calendar year 2015 (pre-acquisition) is nearly halved, on account of various steps taken by the Company to reduce overheads and improve the operating efficiencies. The Company, at the time of acquisition of GSK, already envisaged that for initial two to three years the losses would continue but will get reduced and hope to break-even within two to three years’ time.

The GSK acquisition has also provided opportunity to synergistic advantages in terms of mutually complementary air cooler models, increasing presence in China and ASEAN countries, etc.

7] Awards and Accolades

- The Company was bestowed with India Design Mark for model “CLOUD” by India Design Council.

- Received award for India’s Most Attractive Air Cooler Brand - 2016 from Trust Research Advisory (TRA). As per study report, Symphony Brand rating jumped by 259 ranks and stood at 384 as compared to 643 in the previous year.

- Received the Financial Express CFO of the year award 2017 and your Company has been accorded Rank 1 in the Small Enterprise - Manufacturing category.

- ISO 9001 : 2015 certification for quality management and systems for its design, sales, marketing, after sales services of air coolers.

- Certificate of appreciation from VAT department, Jalgaon, Maharashtra.

- Received a product certification from Standard Organisation of Nigeria.

- Received certification from Kuwait Conformity Assurance Scheme (KUCAS).

The awards won by the Company reflect its consistent outperformance and staying ahead of its competitors with its focused approach, innovative products and dynamic business strategies.

8] Management Discussion and Analysis Report

Pursuant to Regulation 34 of Listing Regulations, Management Discussion and Analysis Report for the financial year ended on March 31, 2017 is annexed to this annual report.

9] Corporate Governance

Your Company has instilled a strong culture of values, morals and integrity and has continuously sustained a cohesive way of thinking and commitment to action. The Company endeavors to be a sustainable and reliable organisation as it trusts that unrelenting governance is the cornerstone in building and upholding relations with all its stakeholders. The Company’s association with its investors is a key factor of Corporate Governance. An enduring communication with investors and shared information about the Company in a regular and trustworthy manner supports the formation of a transparent relationship. It pursues a policy of 100% compliance with all statutory requirements and has a strong system to evaluate them. Your Directors are committed to upholding the highest standards of answerability and intensely participate in overseeing risk and strategic management. The Board completely supports and endorses Corporate Governance practices in accordance with the provisions of the Listing Regulations. The report on Corporate Governance is annexed to this Annual Report.

10] Subsidiaries

Your Company has three subsidiary companies,

(i) Sylvan Holdings Pte. Ltd. (Sylvan), Singapore,

(ii) Guangdong Symphony Keruilai Air Coolers Co. Ltd., China and (iii) IMPCO s. de R. L. De C.V., (IMPCO) Mexico. During the year under review, a second level step down subsidiary of the Company viz. Symphony USA Inc., USA has been closed down w.e.f. December 31, 2016.

During the year under review, IMPCO, Mexico has bought back its entire shareholding held by Sylvan, Singapore and consequently, IMPCO, Mexico has become a direct subsidiary of the Company.

In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared a consolidated financial statement of the Company and its subsidiary companies, which forms part of the Annual Report. Pursuant to provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statement of the Company’s subsidiaries in Form AOC-1 is annexed to the financial statement of the Company. The statement also provides the details of performance and financial position of the subsidiaries of the Company.

The financial statement of the subsidiary companies and related information are available for inspection by the members at the Registered Office of the Company during business hours on all days except Sundays and public holidays upto the date of the Annual General Meeting as required under Section 136 of the Companies Act, 2013. Any member desirous of obtaining a copy of the said financial statement may write to the Company Secretary at the Registered Office of the Company. The financial statements including the consolidated financial statement, financial statement of subsidiaries and all other documents required to be attached to this report have been uploaded on the website of the Company (www.symphonylimited.com).

11] Auditors

Members of the Company, at its 28th Annual General Meeting held on October 27, 2015, had approved appointment of M/s. Deloitte Haskins & Sells, Chartered Accountants, as Auditors of the Company from the conclusion of the then ensuing annual general meeting until the conclusion of the thirty third annual general meeting of the Company, subject to ratification by the Members at every Annual General Meeting.

Pursuant to provisions of Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, the Company shall ratify their appointment every year.

The Company has received a consent letter along with certificate from the Auditor under the provisions of the Companies Act, 2013, to the effect that their appointment, if made, would be within the prescribed limits, they are not disqualified for appointment and further they are independent of management.

The Auditors’ report does not contain any qualification, reservation or adverse remark and is self-explanatory and thus does not require any further clarifications/comments.

12] Cost Auditors

During the year under review, the Company was not required to appoint cost auditors.

13] Corporate Social Responsibility

The annual report on Corporate Social Responsibility is enclosed as Annexure 1 pursuant to the Companies (Corporate Social Responsibility Policy) Rules, 2014. The Policy is displayed on website of the Company.

14] Secretarial Audit Report

As required under Section 204 of the Companies Act, 2013, the Board of Directors of your Company had appointed Mr. Ashwin Shah, Practicing Company Secretary, to conduct Secretarial Audit. The Secretarial Audit Report for the financial year ended on March 31, 2017 is annexed to Board’s Report as Annexure 2.

The Secretarial Auditors’ report does not contain any qualification, reservation or adverse remark and is self-explanatory and thus does not require any further clarifications/comments.

15] Directors and Key Managerial Personnel

Ms. Jonaki Bakeri, Non-Executive Director, retires by rotation at the ensuing Annual General Meeting and being eligible, has offered herself for re-appointment. Brief profile of Ms. Jonaki Bakeri, as required under Regulation 36(3) of the Listing Regulations is annexed to the notice convening the 30th Annual General Meeting, which forms part of this Annual Report. Your directors recommend her re-appointment.

Mr. Achal Bakeri was re-appointed as Managing Director for a period of five years effective December 1, 2012, pursuant to which his present term will be expiring on November 30, 2017. The Board of Directors has re-appointed Mr. Achal Bakeri as Managing Director of the Company for a period of five years from December 1, 2017 subject to approval of members and concerned authorities including Central Government, as may be acquired.

During the year under review, Mr. Darshan Patel, Independent Director, had resigned w.e.f. December 31, 2016. The Board placed on record its appreciation and gratitude for the services and contribution rendered by him during his tenure as an Independent Director.

16] Extract of Annual Return

Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act, 2013, the extract of Annual Return in prescribed Form MGT - 9 is annexed herewith as Annexure 3.

17] Directors’ Responsibility Statement

Pursuant to Section 134(5) of the Companies Act, 2013, the Directors of the Company hereby state and confirm that:

(a) in the preparation of the annual accounts for the financial year ended on March 31, 2017, the applicable accounting standards have been followed and there are no material departures from the same;

(b) they 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 of the Company for that period;

(c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 read with Rules made thereunder for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

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

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

18] Meetings of the Board

Four meetings of the Board of Directors of the Company were held during the year under review. The details of meetings of the Board are reported under Corporate Governance Report which is annexed to Board’s Report.

19] Declaration by Independent Directors

Mr. Dipak Palkar, Mr. Satyen Kothari and Mr. Naishadh Parikh being independent directors, have submitted their declarations stating that they meet the criteria of independence as specified under Section 149(6) of the Companies Act, 2013 and Listing Regulations.

20] Nomination & Remuneration Policy

The Company has framed Nomination & Remuneration Policy for appointment of directors, key managerial personnel and senior management personnel, their remuneration and evaluation of directors and Board. The details of the said policy are reported in the Corporate Governance Report.

21]Particulars of loans, guarantees or investments

The liquidity position of your Company is fairly comfortable and therefore the surplus funds were invested to generate returns. As required under Section 186(4) of the Companies Act, 2013, the following are the details of investments made or loans/guarantee/security given or provided during the year under review:

Sr. No.

Name of Entity

Investment/ Loan/ Guarantee

Relationship, if any.

Aggregate amount of investments made / loan / guarantee provided during the year (Rs. In crores)

Purpose for which loans/ guarantee proposed to

be utilized

1

7.50% Cumulative Redeemable Preference Shares of Tata Capital Limited

Investment

-

10.00

-

2

Principal Protected Secured Redeemable Non-Convertible Market Linked Debenture Series IFPD-6 of IIFL Wealth Finance Limited

Investment

-

10.00

-

3

9.05% Secured redeemable Nonconvertible Debentures of Dewan Housing Finance Corporation Limited

Investment

-

10.00

-

4

9.25% Secured redeemable Nonconvertible Debentures of Dewan Housing Finance Corporation Limited

Investment

-

4.01

-

5

Guangdong Symphony Keruilai Air Coolers Co. Limited (GSK)

SBLC facilities (Security provided)

Wholly Owned Subsidiary

35.00 (equivalent to US$ 5 million)

SBLC facilities to secure repayment of loan by GSK to SCB, China

6

Standard Chartered Bank (China) Limited

Corporate Guarantee

Wholly Owned Subsidiary

US$ 5 million

To secure repayment of loan availed by GSK, China WOS of the Company

Please refer Notes No. 9 and 12 forming part of standalone financial statements for full details of investments made by the Company.

22] Particulars of contracts or arrangements with related parties

The particulars of contracts or arrangements entered with related parties as per Section 188(1) of the Companies Act, 2013, in prescribed Form AOC-2 are given in Annexure 4 to the Board’s Report.

23] Risk Management

The Company is aware of the risks associated with its business. It regularly analyses and takes corrective actions for managing / mitigating the same. The Company periodically reviews its process for identifying, minimizing and mitigating risks. The Board of Directors of the Company have framed a risk management policy and same is being adhered to by the Company. There are no risks which, in the opinion of the Board, threaten the existence of the Company. However, some of the risks which may pose challenges are set out in the Management Discussion and Analysis which forms part of this Report.

24] Annual Performance Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Listing Regulations, the Board of Directors has carried out annual performance evaluation of its own performance, its committees and all directors of the Company as per the guidance notes dated January 5, 2017 issued by the SEBI in this regard. The Nomination and Remuneration Committee has also reviewed the performance of Board and all directors of the Company as required under the Companies Act, 2013 and the Listing Regulations.

i. Criteria for evaluation of Board

Criteria for evaluation of Board broadly covers the competency, experience, qualification of the Director, diversity of the Board, meeting procedures, strategy, management relations, succession planning, functions, duties, conflict of interest, grievance redressal, corporate culture and values, governance and compliance, evaluation of risks etc.

ii. Criteria for evaluation of Committee

Criteria for evaluation of Committee cover mandate and composition, effectiveness, structure and meetings, independence of the committee from Board and contribution to decisions of the Board.

iii. Criteria for evaluation of Directors

These broadly cover qualification, experience, knowledge and competency, ability to function as a team, initiative, attendance, commitment, contribution, integrity, independence, leadership, participation at meetings, knowledge & skill, personal attributes, leadership, impartiality etc.

The Board of Directors expressed their satisfaction with the evaluation process.

25] Audit Committee

The Board of Directors has re-constituted the Audit Committee at its meeting held on February 10, 2017. Subsequent to the reconstitution, the Committee comprises Mr. Dipak Palkar, Chairman, Mr. Naishadh Parikh and Ms. Jonaki Bakeri. As per Section 177(8) of the Companies Act, 2013 and Listing Regulations, the Board has accepted all the recommendations of the Audit Committee during the financial year 2016-17.

26] Vigil Mechanism

The Company has established a vigil mechanism to provide adequate safeguard against victimization and to provide direct access to the Chairman of Audit Committee in appropriate cases. This mechanism is available on the website of the Company.

27] Details of significant and material orders passed by the regulators or courts or tribunals

During the year under review, there was no significant and material order passed by the regulators or courts or tribunals impacting the going concern status and the Company’s operations in future.

28] Particulars of Employees

The statement of disclosure of remuneration and other details as required under Section 197(12) ofthe Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (the Rules), are set out as Annexure 5 to the Board’s Report.

The statement of disclosures and other information as required under Section 197(12) of the Act read with Rule 5(2) and (3) of the Rules forms part of this Report. However, as per first proviso to Section 136(1) of the Act and second proviso of Rule 5(3) of the Rules, the Report and Financial Statement are being sent to the Members of the Company excluding the statement of particulars of employees under Rule 5(2) of the Rules. Any Member interested in obtaining a copy of the said statement may write to the Company Secretary at the Registered Office of the Company.

29] Internal Financial Controls and its adequacy

The Company has laid down internal financial controls to ensure the systematic and efficient conduct of its business, including adherence to Company’s policies and procedures, the safeguarding of its assets, the prevention and early detection of frauds and errors, the accuracy and completeness of the accounting record, and timely preparation of reliable financial information. The same is reviewed by the Statutory Auditor and Internal Auditor at regular intervals and also by the Audit Committee.

During the year under review, the Company has successfully implemented SAP to strengthen the internal control systems.

30] Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

Your Company has in place an Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An internal Complaints Committee has been set up to redress complaints regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

There were no complaints received during the year under review.

31] Deposit

The Company has not accepted any deposit during the year under review and no unclaimed deposits or interest was outstanding as on March 31, 2017.

32] Insurance

The insurable interests of the Company including building, plant & machinery, stocks, vehicles, and other insurable interests like loss of profits, directors & officers’ liability etc. are adequately covered.

33] SEBI order against Sharepro Services (I) Pvt. Ltd. (Sharepro)

During the year under review, complaint lodged by the Company with the Ellisbridge Police Station, Ahmedabad against Sharepro, their employees and others has been converted into FIR. Accordingly, based on investigation, investigating officer has filed a preliminary charge sheet before Hon’ble Metropolitan Magistrate Court, Ahmedabad in a Criminal case.

34] Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

As required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, details relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo are given as Annexure 6.

35] Business Responsibility Report

The Business Responsibility Report for the financial year 2016-17, as stipulated under Regulation 34 of the Listing Regulations, is annexed to this Report as Annexure - 7.

36] Acknowledgments

Your Directors wish to express their appreciation for the efficient and loyal services rendered by each and every employee, without whose whole-hearted efforts, the overall satisfactory performance would not have been possible.

Your Directors also wish to place on record their deep sense of appreciation for the valued support & cooperation by OEMs, distributors, dealers, service franchisees, suppliers, C&FAs, bankers and all other stakeholders of the Company and look forward to their continued association with the Company. The Company will make every effort to meet the aspirations of its Shareholders.

For and on behalf of the Board

Place : Ahmedabad Achal Anil Bakeri

Date : August 10, 2017 Chairman and

Managing Director

DIN - 00397573


Mar 31, 2016

The Directors are pleased to present the 29th Annual Report of the Company for the financial year ended on March 31, 2016. Consequent to the change of financial year from July-June to April- March, the current financial year consists of 9 (Nine) months from July 1, 2015 to March 31, 2016 and accordingly the current financial year figures are not comparable with figures of corresponding previous financial year ended on June 30,2015.

1] A) Highlights of Results and State of Company''s Affairs

(Rs. in lacs)

Particulars Standalone Consolidated

2015-16 2014-15 2015-16 2014-15 (9 Months) (9 Months)

Revenue from Operations & Other Income 43,434 49,264 46,643 55,957

Profit before Financial Charges, Depreciation 17,176 16,444 15,688 16,595 & Taxation, Exceptional Items

Less: Financial Charges 8 57 20 58

Less: Depreciation & Amortisation Expenses 219 213 430 410

Profit before Tax & Exceptional Items 16,949 16,174 15,238 16,127

Add: Exceptional Items - - 1,247 -

Profit Before Tax 16,949 16,174 16,485 16,127

Less: Current Tax 4,589 4,438 4,589 4,442

Less: Deferred Tax 64 133 63 133

Less: Provision of earlier years (4) (39) (4) (39)

Profit after Tax 12,300 11,642 11,837 11,591

Add: Balance as per last year Balance Sheet 23,221 17,475 24,520 18,825

Amount available for Appropriation 35,521 29,117 36,357 30,416

Adjustment relating to Fixed Assets - 7 - 7

Dividend and Dividend Tax (interim and 10,525 5,889 10,525 5,889 proposed)

Balance carried to Balance Sheet 24,996 23,221 25,832 24,520

B) Key Financials as on March 31, 2016

Consolidated Financial Statement

Your Company, along with its subsidiaries, has a global presence. In order to provide an overall view of the comprehensive performance of the group, the Company has prepared consolidated accounts of the holding company and all its subsidiaries, in accordance with the accounting standards that are applicable. The consolidated revenue from operations along with other income stood at Rs.46,643 lacs. The profit after tax was Rs.11,837 lacs.

The highlights of the key financials are as under:

(Rs. in lacs except share data)

Particulars Standalone Consolidated

Equity Share Capital 700 700

Net worth 30,795 31,862

Book Value Per Equity Share 88 91

Earning Per Share (EPS) 35.17 33.84

Investments 18,634 16,229

Contribution to Exchequer 14,013 14,693

2] Dividend

During the period under review, the Board of Directors has declared interim dividend twice aggregating to Rs.25/- (1,250%) per share and bifurcation of the same is as under:

Date of Declaration Interim Dividend Amount per % of Dividend share (in Rs.)

January 28,2016 5/- 250

March 10,2016 (including one-time 20/- 1,000 special dividend of Rs.10/- per share)

The total payout towards interim dividends for . the financial year 2015-16 (including dividend distribution tax) was Rs.10,525 lacs (previous year Rs.5,889 lacs) translating into a dividend payout of 89% (previous year 51%) on consolidated net profit which was much more than minimum dividend payout as mentioned in Dividend Policy of the Company.

Shareholders'' Reward Policy

Symphony believes in maintaining a fair balance over a long term period between payout/reward to the shareholders and cash retention. The Company has been conscious of the need to maintain consistency in payout/ reward to the shareholders. The quantum and manner of payout/reward to shareholders of the Company shall be recommended by the Board of Directors of the Company.

Method of Payout/Rewards to the Shareholders

1.1 Dividend Distribution Policy

This policy is framed pursuant to Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015.

a) The Company will generally endeavour to distribute to the shareholders up to 50% of its profit after tax (including dividend distribution tax and other taxes as applicable).

b) In rare circumstance of any contingency, acquisition opportunities or other business opportunities or unforeseen circumstances, payout to shareholders may be precluded at the discretion of the Board of Directors.

c) Recommendation with regard to payout to shareholders shall be influenced by various factors including, without limitation, internal factors such as profits earned during the fiscal year, liquidity position, fund requirement for acquisitions, reward to shareholders by corporate actions (like buy back of shares) and external factors such as general market conditions, cost of raising funds from alternate sources, applicable taxes including tax on dividend, exemptions under tax laws available to various categories of investors and future expansion opportunities etc.

d) The retained earnings of the Company shall be utilized for future growth and expansion of business, probable acquisitions, working capital and for meeting unforeseen contingencies.

e) The Company has only one class of shares viz. equity shares.

1.2 Interim Dividend

The Board of Directors may, as and when consider it fit, on the basis of performance, profitability, liquidity and on review of quarterly / half yearly / periodical financial statements declare interim dividend to reward the shareholders.

1.3 Special Dividend

The Company may consider special dividend in exceptional circumstances in such event, the limit as stated in clause 1 (a) above may exceed.

2. Bonus Issue

As and when the company has large accumulated reserves represented by free reserves, securities premium, surplus etc. which are felt more than the requirements of the Company, the Board may consider to utilise such balances towards issuance of bonus equity shares or any other security (ies) as may be permissible under the applicable provisions of the Companies Act, 2013, SEBI Act alongwith applicable regulations thereunder and any other Act as may be applicable.

3. Buy Back

As and when the Company has large accumulate reserves represented by free reserves, security premium, surplus etc. which is also supported by sufficient liquidity in the company, the Board of Directors may consider to carry out Buy Back of its equity shares in accordance with the relevant applicable provisions of the Companies Act, 2013, SEBI Act alongwith applicable regulations thereunder and any other Act as may be applicable.

4. Sub Division /Splitting of Shares

The Board of Directors may also consider to sub divide the equity shares in order to improve the liquidity in the market and to make it more affordable to retail shareholders thereby attracting better participation of retail shareholders in the equity shares of the Company.

3] Material Changes and Commitment

a. Interim Dividend

The Board of Directors at its meeting held on July 26, 2016 has declared a 1st interim dividend of Rs.1.50 (75%) per equity share having face value of Rs.2/- (Rupees Two) each for the year 2016-17. The dividend payout to the shareholders will be Rs.631.49 lacs including dividend distribution tax.

b. Issue of Bonus Shares

The Board of Directors at its meeting held on July 26, 2016 has recommended a bonus issue of shares in the proportion of one fully paid up bonus equity share of Rs.2/- each for every one fully paid up equity share of Rs.2/- each held as on record date to be determined. The said bonus shares shall be subject to approval of members at ensuing Annual General Meeting.

Except the aforesaid, there was no material change and commitment affecting the financial position which occurred between the financial year and to the date of this report.

4] Operations Review

During the period under review, revenue from operations along with other income on standalone basis stood at Rs.43,434 lacs. During the period 2015-16, your Company continued to expand its domestic presence by widening its marketing network of distributors, dealers and retail chain stores throughout the country with adequate warehousing infrastructure in all strategic locations in various parts of the country. Your Company has taken steps to revitalise the organisational structure of the marketing function to enable better penetration into the local market. Your Company has also initiated steps to strengthen its after sales service and increase its market penetration by appointing service franchisees in new locations and introducing a single nationwide customer care number. This will enable prompt and efficient provision of after sales service, particularly to strategic locations in the country.

Your Company strengthened its leadership position in the air cooler industry through a consistent focus on new product development and innovation, making it possible to offer a wide range of air coolers with a variety of new features. Ten new models of air coolers with a host of innovative features were introduced during the period. The existing models were also given a complete facelift with regard to the looks, features and packaging to make them more contemporary and appealing to the consumer. As a result of these measures, your Company now offers 44 models of air coolers to meet the requirements of a variety of customers.

To stimulate demand, your Company continues doing aggressive advertisement and promotional campaigns over print, electronic and digital media. Your Company''s R&D Department has come out with innovative products and technologies, enabling it to offer a complete range of air cooling solutions for all segments of customers.

During the period under review, the Company launched the world''s first wall mounted air cooler named "CLOUD". The Company has also filed an application for a global patent for this unique product, which comes with many new features such as multistage air purification, magic fill for automatic water refill, intelligent full remote control, fully closable automatic louvers and empty water tank alarm. Your Company has also introduced i-PURE technology which incorporates a multi-stage air purification system that comes with a set of filters that work together to keep air and water pollutants away and deliver pure and cool air. i-PURE technology coolers are equipped with advanced features, high quality PM2.5 wash filter pads and other filters which remove smell, dust and allergy particles.

Your Company is keenly aware of the important role played by its trade partners in the selling process and their contribution to its success. Accordingly, the Company has taken several steps to expand the retail network with a view to penetrate the domestic market further and to ensure easy availability of goods in the remotest corners of the country. During the period, your Company has taken several measures to increase trade loyalty and strengthen the relationships with distributors and retailers which have helped it in maintaining and further strengthening the market share.

Modern Trade

During the period under review, your Company continued to be aggressive in top line products sales through large format stores, retail chains, e-commerce portals and TV shopping channels. Your Company could maintain its number one position in modern trade, registering a healthy growth.

Your Company offered a distinct range of models for sale through e-commerce in order to have a greater focus on this emerging sales channel and also to avoid any kind of model conflict between traditional trade and e-commerce. Your Company continued to widen its modern trade market network and ensured better shelf space in the existing outlets. This has resulted in structured retail chains accounting for a significant portion of the Company''s total sales.

Your Company believes that the Modern trade is increasing at a faster pace than ever before and is eager to exploit its potential.

Central Air Cooling Solutions

The Central Air Cooling Solutions business has been further strengthened through focussed efforts, increased manpower and improved nation-wide dealer network.

During the period, your Company focussed on laying down detailed technical and operating guidelines followed by a series of training programs. Your Company successfully trained its dealer network on a pan India basis. The Company also bagged and executed numerous prestigious orders including those from Sanden, ABB, Havmor, Honda Two Wheelers, Vardhman Textiles, Hero Cycles, BHU and continued to develop its prominent clientele covering different customer segments like banks, auto industry, packaging, place of worship, FMCG, warehouses, hospitals, distilleries and railways. Your Company continues to make inroads into various segments with approvals from some key opinion makers like HVAC consultants and large MEP contractors. During the period under review, your Company continued with many business development activities through advertisements in newspapers, journals, TV channels and participation in exhibitions.

Your Company''s Packaged Air Coolers are compact, easy-to-install and are meant for mid- size spaces such as commercial, industrial and residential areas. They have gained momentum and have been received very well in the market. The campaign has resulted in increased awareness about Central Air Cooling Solutions. Your Company hopes to encash the benefits of these steps in the years to come.

Air Coolers - Overseas Business

Revenues from overseas business during the year under review remained at Rs. 46 crore. The economic crisis and currency devaluation in CIS countries had adversely affected the overseas business during the period. During the period under review, the Company successfully penetrated into newer markets like Slovenia, Cambodia,Thailand, Indonesia and Kenya. Your Company registered good growth in its business in the markets of U.K., Mauritania, Vietnam, Spain and Sri Lanka and envisages more openings and opportunities that are waiting to be tapped.

Your Company continued its focus on strategic and select markets including its focus on exports largely to the MENA region. Your Company continues to have several international quality certifications like CE, SASO, NOM etc. which provide access to other countries as well.

SEZ Units

During the period under review, the Company had operations in two Special Economic Zone (i) Kandla SEZ at Gandhidham, Kutch, Gujarat and (ii) Surat SEZ at Sachin, Surat, Gujarat. The operations at both SEZ units remain satisfactory. It may be noted that the SEZ units enjoy a number of direct and indirect tax benefits including benefits under new foreign trade policy.

Overseas Operations - Impco S. de R. L. de C.V, Mexico Impco S. de R. L. de C. V., Mexico, (Subsidiary Company) manufactures and markets a variety of coolers. Since the period under review which ended on March 31, 2016, is of 9 months as against the previous year of 12 months which ended on June 30, 2015, the figures are not comparable. Since the main season in Mexico is April to July, which is not part of the period under review, the peak season performance of the subsidiary is not reflected in the period under review, and only lean season performance is reflected.

As part of its strategy of introducing lean manufacturing operations, IMPCO has sold a part of its Land & Building located on Carr. Miguel Aleman 6061, Col. America, Guadalupe, Nuevo Leon for a consideration of Mexican Pesos 34 million (Eguivalent to INR 13 crore. approx.) plus VAT. In the future, other surplus real estate will also be monetized. This initiative will help IMPCO in following manner:

1. To retire its internal debt to parent company.

2. To improve its profitability by reduction in interest, depreciation, overhead and exposure to foreign exchange fluctuations.

5] Overseas Acquisition in China

During the period under review, your Company has successfully acquired 100% equity share capital of Munters Keruilai Air Treatment Equipment (Guangdong) Co. Ltd., China, from Munters AB according to Equity Transfer Agreement. This company has become a wholly owned subsidiary of your Company with effect from January 1,2016. Consequently, the accounts of the acquired company for the period of 3 months ended on March 31, 2016 are included in the consolidated financial statement. The Company has already received the certificate of approval for establishment of enterprises with foreign investment in the People''s Republic of China endorsing name of the Company as Investors from the concern Chinese Authority. The name of said company was changed to Guangdong Symphony Keruilai Air Coolers Co. Ltd. Your Company is in the process of reviewing and improving the performance of this company.

During the period under review, your Company was bestowed with "Best SME-Overall" and "Best SME-Manufacturing" in 2015 edition of Business Today''s Best SME Awards in the Rs. 250 crore and above turnover category. The Company won the awards for its consistent outperformance and staying ahead of its competitors with its focused approach, innovative products and dynamic business strategies.

7] Management Discussion and Analysis Report

Pursuant to Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as "Listing Regulations"), Management Discussion and Analysis Report for the financial year ended on March 31,2016 is annexed to this annual report.

8] Corporate Governance

Your Company has instilled a strong culture of values, morals and integrity and has continuously sustained a cohesive way of thinking and commitment to action. The Company endeavours to be a sustainable and reliable organisation as it trusts that unrelenting governance is the cornerstone in building and upholding relations with all its stakeholders. The Company''s association with its investors is a key factor of Corporate Governance. An enduring communication with investors and shared information about the Company in a regular and trustworthy manner supports the formation of a transparent relationship. It persues a policy of 100% compliance with all statutory requirements and has a strong system to evaluate them. Your Directors are committed to upholding the highest standards of answerability and intensely participate in overseeing risk and strategic management. The Board completely supports and endorses Corporate Governance practices in accordance with the provisions of clause 49 of the Listing Agreement and the Listing Regulations. The report on Corporate Governance is annexed herewith.

9] Subsidiaries

Your Company has four subsidiary companies, (i) Sylvan Holdings Pte. Ltd., Singapore, (ii) Guangdong Symphony Keruilai Air Coolers Co., Ltd. China, (iii) Impco S. de R. L de C.V, Mexico, (iv) Symphony USA Inc., USA. There is no material change in the nature of business of subsidiaries.

In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared a consolidated financial statement of the Company and its subsidiary companies, which forms part of the Annual Report. Pursuant to provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statement of the Company''s subsidiaries in Form AOC-1 is annexed to the financial statement of the Company. The statement also provides the details of performance and financial position of the subsidiaries of the Company.

The financial statement of the subsidiary companies and related information are available for inspection by the members at the Registered Office of the Company during business hours on all days except Sundays and public holidays upto the date of the Annual General Meeting as required under Section 136 of the Companies Act, 2013. Any member desirous of obtaining a copy of the said financial statement may write to the Company Secretary at the Registered Office of the Company. The financial statements including the consolidated financial statement, financial statement of subsidiaries and all other documents required to be attached to this report have been uploaded on the website of the Company (www.symphonylimited.com).

10] Auditors

Members of the Company, at its 28th Annual General Meeting held on October 27, 2015, has approved appointment of M/s. Deloitte Haskins & Sells, Chartered Accountants, as an Auditor of the Company from the conclusion of the then ensuing annual general meeting until the conclusion of the thirty third annual general meeting of the Company, subject to I ratification by the Members at every Annual General Meeting.

Pursuant to provisions of Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, the Company shall ratify their appointment every year.

The Company has received a consent letter along with certificate from the Auditor under the provisions of the Companies Act, 2013, to the effect that their appointment, if made, would be within the prescribed limits and are not disqualified for appointment and further they are independent of management.

The Auditors'' report does not contain any qualification, reservation or adverse remark and is self-explanatory and thus does not require any further clarifications/comments.

The Company takes on record, the valuable services of M/s Shah and Dalai, Chartered Accountants who were the statutory auditors of the Company since inception prior to appointment of M/s Deloitte Haskins & Sells as an auditor.

11] Cost Auditors

During the period under review, the Company was not required to appoint a cost auditor.

12] Corporate Social Responsibility

The annual report on Corporate Social Responsibility is enclosed as Annexure 1 pursuant to the Companies (Corporate Social Responsibility Policy) Rules, 2014. The Policy is displayed on website of the Company.

13] Secretarial Audit Report

As required under Section 204 of the Companies Act, 2013, the Board of Directors of your Company had appointed Mr. Ashwin '' Shah, Practicing Company Secretary, to conduct Secretarial Audit. The Secretarial Audit Report for the financial year ended on March 31,2016 is annexed to Board''s Report as Annexure 2.

The Secretarial Auditors'' report does not contain any qualification, reservation or adverse remark and is self-explanatory and thus does not require any further clarifications/comments.

14] Directors and Key Managerial

Mr. Nrupesh Shah, Executive Director, retires by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re- appointment. Brief profile of Mr. Nrupesh Shah, as required under Regulation 36(3) of the Listing Regulations, is annexed to the notice convening the 29th Annual General Meeting, which forms part of this Annual Report. Your directors recommend his re-appointment.

Mr. Nrupesh Shah was re-appointed as an Executive Director for a period of five years effective November 1, 2011, pursuant to which his present term will be expiring on October 31, 2016. The Board of Directors at its meeting held on July 26, 2016 has re-appointed Mr. Nrupesh Shah as Whole Time Director designated as an Executive Director for a period of five years from November 1, 2016 subject to approval of members.

During the period under review, Mr. Himanshu Shah, Independent Director, has resigned w.e.f November 30, 2015. The Board appreciated his contributions during his tenure as an Independent Director.

Due to retirement, Mr. Chandrakant Gandhi ceased to be Company Secretary and Compliance Officer w.e.f. October 31, 2015. The Board recognised his long term services to the Company.

Mr. Manan Bhavsar was appointed as a Company Secretary and Compliance Officer vve.f. November 1, 2015. He had tendered his resignation and accordingly he was relieved from this position w.e.f. close of working hours on June 30,2016.

Mr. Mayur Barvadiya has been appointed as a Company Secretary and Compliance Officer w.e.f. July 26,2016.

15] Extract of Annual Return

Pursuant to Section 3 (a) of Section 134 and Section 92(3) of the Companies Act, 2013, the extract of Annual Return in prescribed Form MGT - 9 is annexed herewith as Annexure 3.

16] Directors'' Responsibility Statement

Pursuant to Section 134(5) of the Companies Act, 2013, the Directors of the Company hereby state and confirm that:

(a) in the preparation of the annual accounts for the financial year ended on March 31, 2016, the applicable accounting standards have been followed and there are no material departures from the same;

(b) they 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 of the Company for that period;

(c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 read with Rules made thereunder for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

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

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

17] Meetings of the Board

Four meetings of the Board of Directors of the Company were held during the period under review. The details of meeting of the Board are reported under Corporate Governance Report which is annexed to Board''s Report.

18] Declaration by Independent Directors

Mr. Dipak Palkar, Mr. Satyen Kothari, Mr. Naishadh Parikh and Mr. Darshan Patel being independent directors, have submitted their declarations stating that they meet the criteria of independence as specified under Section 149(6) of the Companies Act, 2013 and under the Listing Regulations.

19] Nomination & Remuneration Policy

The Company has framed Nomination & Remuneration Policy for appointment of directors and senior management personnel, their remuneration and evaluation of directors and Board. The details of the said policy are I reported in the Corporate Governance Report.

20] Particulars of loans, guarantees or investments

The liquidity position of your Company is fairly comfortable and therefore the surplus funds were invested to generate returns. As required under Section 186(4) of the Companies Act, 2013, the following are the full details of investments made or loans provided during the year under review:

21] Particulars of contracts or arrangements with related parties

The particulars of contracts or arrangements entered with related parties as per Section 188(1) of the Companies Act, 2013, in prescribed Form AOC-2 are given in Annexure 4 to the Board''s Report.

22] Risk Management

The Company is aware of the risks associated with its business. It regularly analyses and takes corrective actions for managing / mitigating the same. The Company periodically reviews its process for identifying, minimizing and mitigating risks. The Board of Directors of the Company have framed a risk management policy and same is being adhered by the Company. There are no risks which, in the opinion of the Board, threaten the existence of the Company. However, some of the risks which may pose challenges, are set out in the Management Discussion and Analysis which forms part of this Report.

23] Annual Performance Evaluation

Pursuant to the provisions of the Companies Act, 2013, the Board of Directors has carried out annual performance evaluation of its own performance, its committees and all directors of the Company. The Nomination and Remuneration Committee has also reviewed the performance of Board and all directors of the Company as required under the Companies Act, 2013 and the Listing Regulations.

Criteria for evaluation of Board and Committee

These criteria broadly covers the composition & quality, meeting procedures, strategy, management relations, succession planning, functions, duties, etc.

Criteria for evaluation of Directors

They broadly covers participation at meetings, knowledge & skill, personal attributes, leadership & quality, strategy, formulation and execution, planning & execution, human resource management/relations, product/ service knowledge and so on.

24] Audit Committee

The Board of Directors has re-constituted the Audit Committee at its meeting held on October 23, 2015. Subsequent to the reconstitution, Committee comprises Mr. Dipak Palkar, Chairman, Mr. Naishadh Parikh, Mr. Darshan Patel and Ms. Jonaki Bakeri. As per Section 177(8) of the Companies Act, 2013 and Listing Regulations, the Board has accepted all the recommendations of the Audit Committee during the financial year 2015-16.

25] Vigil Mechanism

The Company has established a vigil mechanism to provide adequate safeguard against victimization and to provide direct access to the Chairman of Audit Committee in appropriate cases. This mechanism is available on the website of the Company.

26] Details of significant and material orders passed by the regulators or courts or tribunals

During the period under review, there was no significant and material order passed by the regulators or courts or tribunals impacting the going concern status and the Company''s operations in future.

27] Particulars of Employees

Pursuant to Section 197(12) read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, information of directors/employees of the Company are set out as Annexure 5 to the Board''s Report.

28] Internal Financial Controls and its adequacy

The Company has devised an internal control system across various functions and the same is reviewed by the Statutory Auditor and Internal Auditor at regular intervals. There is a centralized ERP system with user rights given on "need-to-know" basis and "maker-checker" concept is incorporated in each transaction entered in the system. All payments are subject to pre-authorisation as well pre-audit. Further to strengthen the systems and processes and looking to the global presence and growth, the Company has implemented SAP, ERP system with the help of M/s KPIT a well known SAP implementation partner. The project cost would be over Rs.5 crore.

29] Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

Your Company has in place an Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An internal Complaints Committee has been set up to redress complaints regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

There were no complaints received during the period under review.

30] Deposit

The Company has not accepted any deposit during the year under review and no unclaimed deposits or interest was outstanding as on March 31,2016.

31]Insurance

The insurable interests of the Company including building, plant & machinery, stocks, vehicles, and other insurable interests like loss of profits, directors & officers'' liability etc. are adequately covered.

32] SEBI order against Sharepro Services (I) Pvt. Ltd.

The Securities and Exchange Board of India (SEBI) vide its order no. WTM / RKA / MIRSD2 / 41 / 2016 dated March 22, 2016, has passed Ex Parte - Ad - Interim Order against Sharepro Services (I) Pvt. Ltd. (Sharepro) and others in order to protect the interest of investors and integrity of the securities market. SEBI has also directed all client companies of Sharepro to conduct thorough audit of records and systems of Sharepro. The Company has, after preliminary inquiry, prima facie discovered certain irregularities w.r.t. share related operations at Sharepro. The Company has filed a complaint on March 30, 2016 with Ellisbridge Police Station, Ahmedabad against Sharepro and others, for further investigation in the matter. The Company had already terminated services of Sharepro.

As per the directions provided in the said order of SEBI, the Company had appointed Ernst & Young LLP, as an Auditor, to complete its audit within 3 months from the date of the said order. Accordingly the Company has submitted the report of Ernst & Young LLP to the SEBI. Further the Company will take appropriate action as per the SEBI order.

33] Change of Registrar and Share Transfer Agent

In view of the SEBI order dated March 22, 2016, the Company has appointed M/s. Karvy Computershare Pvt. Ltd., as the Registrar and Share Transfer Agent.

34] Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

As required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, details relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo are given as Annexure6.

35] Acknowledgments

Your Directors wish to express their appreciation of the committed services by employees at all levels. Your Directors also wish to place on record their deep sense of appreciation for the valued support & co-operation by OEMs, distributors, dealers, service franchisees, suppliers, C&FAs, bankers and all other stakeholders of the Company and look forward to their continued association with the Company. The Company will make every effort to meet the aspirations of its Shareholders.

For and on behalf of the Board

Place: Ahmedabad Achal Bakeri

Date July 26,2016 Chairman and

Managing Director

DIN-00397573


Jun 30, 2014

Dear Members,

The Board of Directors present 27th Annual Report along with consolidated and standalone audited annual accounts for financial year ended June 30, 2014.

1]A) Highlights of Results (Rs.in Lac)

Standalone Consolidated Particulars 2013-2014 2012-2013 2013-2014 2012-2013

Revenue from Operations & Other Income 46,637 32,512 54,650 39,473

Profit before Financial Charges, 13,678 9,385 13,990 9,558 Depreciation & Taxation

Less: Financial Charges 5 32 5 32

Less: Depreciation & Amortisation Expenses 115 131 382 394

Profit before Tax 13,558 9,222 13,603 9,131

Less: Income Tax 3,662 2,522 3,676 2.522

Less: Deferred Tax Liability 9 (4) 8 151

Less: Provision for tax of earlier years - 436 (726) 436

Less: Loss from discontinuing operations - - 73 11

Profit after Taxation 9,887 6,268 10,572 6,011

Add: Balance as per last year Balance Sheet 12,908 10,300 13,573 11,222

Amount available for Appropriation 22,795 16,568 24,145 17,233

Transfer to General Reserve - 1,000 - 1,000

Proposed Dividend & Dividend Tax 5,320 2,660 5,320 2,660

Balance carried to Balance Sheet 17,475 12.908 18,825 13,573

B) Other Key Financials as on June 30, 2014

Consolidated Financial Results

Your Company with its subsidiaries have global presence and to view overall comprehensive performance of the Company, the Company has consolidated its accounts with the accounts of its subsidiaries in compliance with applicable accounting standard. The consolidated total revenue stood at Rs.54,650 lac which grew by 38% as compared to the consolidated total revenue of previous year. The profit after tax touched to Rs.10,572 lac as compared to Rs.6,011 lac in the previous year recording an increase of 76%

The highlights of the key financials are as under:-

(Rs.in lac except per share data)

Particulars Standalone Consolidated

Equity Share Capital 700 700

Net worth 23,274 27,578

Book Value Per Equity Share 67 79

Earning Per Share (EPS) 28.27 30.23

Investments/Corporate Funds 19,474 19,474

Contribution to Exchequer 11,857 13,560

2] Dividend

The Board has recommended final dividend of Rs.11 (550%) per equity share having face value of Rs.2 each for the financial year ended on June 30, 2014, payable subject to approval at ensuing annual general meeting. Your Board of Directors had declared maiden interim dividend of Rs.2 (100%) per equity share having face value of Rs.2 each. Thus aggregate dividend for the year ended on June 30, 2014 on approval at ensuing annua general meeting would be Rs.13 (650%) per share as against Rs.6.50 (325%) for the previous year

The total payout including final dividend as above for the year 2013-14 (including dividend distribution tax) would be Rs.5,320 lac (previous year Rs.2,660 lac) translating into a dividend payout of 50% (previous year 44%) on consolidated net profit.

Dividend Policy

Symphony believes in maintaining a fair balance between dividend distribution and cash retention Symphony has been conscious of the need to sustain stability in its dividend payout. Symphony has decided to have a dividend payout of atleast 50% of profits (including dividend distribution tax) subject to business contingency or unforeseen cash requirements. Cash retention is required for future growth, probable acquisitions and to meet any unforeseen contingency. The Company has also a recent practice of paying interim dividend

3] Operations Review

Operating in policy log jam prevalent during the previous year and uncertain political environment resulted into absence of vibrant growth inducing policies placing nation''s economic growth on the backburner. Regardless of adverse externa environment coupled with rising cost, stubborn inflation and policy-jam, all business verticals of your Company recorded improved numbers. Your Company on standalone basis posted a gross turnover of Rs.45,124 lac in 2013-14, a growth of 46%overRs.30,836lacin 2012-13.

During the year under review, your Company continued to develop its nationwide presence by expanding network of its distributors, dealers in more and more towns throughout the country with suitable warehousing facilities in all strategic places in different regions of the country. Your Company continues to strengthen its operating structure of its marketing function to pierce into the immense latent regions within the country. Correspondingly, your Company is also intensifying ''After Sales Service'', through service franchisees with ''nation wide Customer Care Number'' to touch to core locations of the nation offering well- timed and resourceful after sales service.

Persistent innovative steps by your Company enabled it to offer extensive range of air coolers having varieties of features. Presently, your Company has 23 models of air coolers to outfit the necessities of variety of customers in different provinces of the nation

To stimulate encouraging prospects, your Company initiated aggressive advertisement and promotional campaigns over print, electronic media and digital with expanded manpower. Your Company is optimistic to tap the enormous opportunity of rural and urban markets

Air coolers - Domestic Operations

During the year under review, your Company strengthened its leadership position in air cooler ndustry by consistent growth both in terms of sales volume and sales revenue.

Symphony continued its focus on new product development, strategic planning inter-alia consisting of superior quality, penetration in new markets, enlarging market network, prompt and efficient ''after sales service'', promotion of brand mage, which added momentum to its growth journey. Well planned and effective marketing strategies have made ''Symphony cooler'' a much preferred choice in competitive environment. During the year ''BTL'' (below the line) activities were successfully introduced by your Company as measure of brand promotion

Your Company is constantly evaluating options to enhance its capacity at present locations and also by tying up with new original equipment manufacturers at strategic locations in order to keep pace with growing demand. Numerous Research & Development initiatives are undertaken by your Company for improved and new models with added features to meet individual choice of the customers at large. Symphony in the year 2013-14, launched 8 new models of ''air coolers with advanced features. To cater diverse needs for air coolers, your Company along with its subsidiaries offers entire range of air cooling solutions effectively for all classes of customers, manufactured either in house or out sou reed

During the year, your Company penetrated into new markets of North Eastern states of India with robust focus on evolving present markets with more branches and warehousing facilities. Your Company''s focus on quality products with power saving technology has been vital strengths. The very allure of the Indian air cooler market is leading to steep competition among the prominent companies which have been encountered by your Company by tactical advertising and promotiona drive to prevail upon the consumers by offering greater value for every rupee spent

Your Company also predicts substantial potentia in the country for the air coolers meant for centra air cooling solutions, manufactured by its step down subsidiary company, Impco S. de R.L de C.V., Mexico as its products are fairly well received in the domestic market

Your Company is confidentto continue its growth journey with extensive market network as well as enlargement of dealer network reinforced by competent strong marketing team of professionals in India and abroad

Modern Trade

Again Symphony sustained its position at number one in modern trade business with amazing growth compared to lastyearand demonstrated to be a prominent air cooler brand in air cooler trade. The Company became more aggressive in top line products sales at stores, B2B business, e-commerce business, TV shopping business and regional retai sales business.

The modern trade channel continued to be a growth engine to the Company''s business as it energies growth by healthier shopping experience and greater visibility in the markets. Your Company continued to widen its modern trade market network to penetrate with better space. Your Company now enjoys substantial portion of the sales through organised retail chain in the country. Your Company believes that the Modern trade is rising at a faster clip and is enthusiastic to exploit its potentiality.

Central Air Cooling Solutions

Central Air Cooling Solutions business of the Company though still in nascent stage had been able to strengthen its operations. The focus was to have adequate representation and therefore the required manpower structure has been employed Subsequently, the aim is to create a base of dealer network across the country. The dealer network is increased by more than 75% indicating the confidence now the business drives amongst the trade.

Your Company has made some major breakthroughs in terms of entry into prestigious clientele covering various customer segments ike auto industry, packaging, places of worship, FMCG, paint industry, logistics, sugar mills, hospitals, distilleries, railways, commercia applications etc. There were repeat orders from some customers which establish their trust in the Company and its products

Your Company has made inroads with approvals from some key opinion makers like HVAC consultants and big HVAC con tractors

During the year under review, your Company witnessed many business developmental activities ike advertisement in leading HVAC journals, newspapers, participation in selected exhibitions with excellent response. An innovative digita campaign was also initiated which was successful

Air coolers - Overseas Business

Revenues from overseas business during the year under review crossed all previous peaks and touched to Rs.5,663 lac as against Rs.3,533 lac in 2012-13, an overall rise of 60%. Presently, your Company continues to export in about 60 countries and with vast opportunities yet to be accomplished

In the year 2013-14, exports of your Company to European countries grew handsomely. However, external challenging conditions prevalent due to political turmoil and instability in key operationa countries of Middle East and North African

Region led to demand contraction coupled with nflationary trend. Although, the business of your Company continued to sustain and the operating margins of exports improved fairly during the year reflecting the strength of the products and its brand in the overseas markets. Externa conditions are expected return to normalcy and your Company foresees to grow further

The Company continued its focus on strategic and select markets. Your Company has also organised warehouse facilities in Europe to boost presence in European countries. Your Company also continues its focus on exports primarily to MENA region, Latin America etc. Your Company continues to have numerous international quality certifications like GS, CE, SASO, NOM, KUCAS, etc. which contribute access to other countries as well

SEZ Unit at Sachin, Surat in Gujarat

In the year 2013-14, the SEZ unit of the Company situated at Sachin, Surat, surpassed production of more than one lac air coolers of different models. This is the highest ever production in a single year since its inception. The SEZ unit enjoys number of benefits, both direct and indirect, including 100% exemption of export profits.

4] Overseas Operations - Impco S. de R. L. de C.V, Mexico mpco S. de R. L. de C.V, (IMPCO), Mexico, step down subsidiary of the Company manufactures and markets a variety of coolers. For the period under review, Impco has shown improved efficiency and registered encouraging results. At

mpco, improvement is an on-going exercise to exploit its large manufacturing capacity. Impco has adopted ''5-S'' system to enhance its operationa processes and efficacy

Asa measure of tax reforms undertaken by Mexican government, IETU tax has been abolished w.e.f January 01, 2014, consequently, the deferred tax liability amounting to Rs.727 lac, created in the books of accounts of Impco is no longer required and the same has been written back.

mpco serves markets in Mexico and USA and enjoys excellent business tie ups with many prominent modern retails chains like Wal-mart, Sears, Home Depot, Lowes, Famsa, and Costco This complements the presence of your Company in the global arena

In June 2014, the Perry Johnson Registrars, Inc, had conducted second ISO 9001:2008 surveillance audit at IMPCO, Mexico and Mr. Enrique Sepulveda, from the external agency informed that IMPCO''s processes were in compliance with the Quality Management Systems.

5] Awards & Recognitions

Your Company''s products and performance continues to be recognised and appreciated across the country and the globe as well. During the year, yourCompany has been recognised and bestowed with followings awards:

(i) ''Best Presented Annual Report in the Manufacturing Sector'' by the South Asian Federation of Accountants for your Company''s Annual Report of 2011-12 for its Transparency, Accountability and Governance.

(ii) ''Quality Mark 2014'' award for Best Quality Organisation in the Home Appliances category by the Quality Mark Trust.

6] Management Discussion and Analysis Report

Pursuant to clause 49 of listing agreement, management discussion and analysis report for the year is annexed to this annual report.

7] Corporate Governance

Your Company has inculcated a strong culture of values, ethics and integrity and has always upheld an integrated way of thinking via obligation of action. The Company strives to be a sustainable and trusted organisation as it believes that sustained governance is the corner stone in building and upholding interactions with all its stake holders. The Company''s relationship with its investors is a key component of Corporate Governance. An ongoing interaction with nvestors and communicating information about the Company in a consistent and credible way aids to establish a transparent relationship. It meticulously pursues a policy of 100% compliance with all statutory requirements and has a robust system to review them.

Your Directors consider in upholding the highest standards of accountability and keenly participate in overseeing risk and strategic management. The Board fully supports and endorses Corporate Governance practices in accordance with the provisions of Clause 49 of the listing agreement and the report on Corporate Governance and Management Discussion and Analysis, as required under clause 49 of the Listing Agreement is annexed

The Chairman and Managing Director, Executive Director and Chief Financial Officer have certified to the Board regarding the financia statements and other matters as required in clause 49 of the Listing Agreement and the said certificate is contained in the Annual Report. A certificate from the auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement is also annexed. All the Board members and senior management personnel have affirmed compliance with the Code of Conduct.

The Board has implemented a Code of Business Conduct and an "Ethics Code" aimed at members and senior management to inculcate business ethics in the Company in their dealings with employees and business associates.

8] Subsidiaries

Your Company continues to have two subsidiary companies and two step down subsidiary companies. Sylvan Holdings Pte. Ltd., Singapore, (Sylvan) and Symphony Air Coolers Inc. USA are two subsidiaries. Sylvan has a subsidiary company in a Mexico i.e. Impco S. de R. L. de C.V (IMPCO). mpco, in turn, has a subsidiary company in the USA, namely Symphony USA Inc., which markets a variety of coolers. Symphony Air Coolers Inc. USA is under process of its closure and its business is taken care of by Symphony USA Inc. There is no material change in the nature of business of subsidiaries

Pursuant to provision of section 212(8) of the Companies Act, 1956, Ministry of Corporate Affairs vide its circular dated February 8, 2011 has granted general exemption from attaching the Balance Sheet, Profit & Loss Account and other documents of the subsidiary Companies with the Balance sheet of the Company. The Company will make available the Annual Accounts of the subsidiary companies and the related detailed nformation to any member of the Company, who may be interested in obtaining the same. The annual accounts of the subsidiary companies will also be kept open for inspection at the Registered Office of the Company. The Consolidated Financia Statements presented by the Company include the financial results of its subsidiary companies.

9] Consolidated Financial Statements

In accordance with the Accounting Standard AS-21 on Consolidated Financial Statements and Clause 32 of the Listing Agreement with the Stock Exchanges, the audited Consolidated Financia Statements are provided in the Annual Report 2013-14 for its subsidiary Companies, i.e. Sylvan Holdings Pte. Ltd., Singapore, Symphony Air Coolers Inc., USA, Impco S. de R. L. de C.V, Mexico and Symphony USA Inc., USA.

10] Directors Responsibility Statement

Pursuant to sub-section (2AA) of Section 217 of the Companies Act, 1956, the directors of the Company hereby state and confirm that: in preparation of the Annual Accounts for financial year 2013-14, applicable accounting standards have been followed and there has been no material departures;

i. they 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 of the Company for that period;

i they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

11] Auditors

M/s. Shah & Dalai, Chartered Accountants, Ah medabad, hold office as Auditor of the Company until the conclusion of the ensuing Annua General Meeting and the Board recommends their re-appointment till the conclusion of next Annua General Meeting

The Company has received a consent letter along with certificates from Auditor under provisions of the Companies Act, 2013 to the effect that their reappointment, if made, would be within the prescribed limits and are not disqualified for re- appointment.

12] Cost Auditors

Pursuant to Cost Audit Branch Order dated November 6, 2012, issued by Ministry of Corporate Affairs, M/s. Dalwadi & Associates, Cost Accountants, were appointed as Cost Auditor for the financial year ended on June 30,2014 with approval of Central Government.

The cost compliance report for financial year 2012-13 was filed by the Company on December 24, 2013 within prescribed time limit. Further the cost audit report for the financial year ended June 30, 2014 will be filed within prescribed time period

13] Corporate Social Responsibility:

Section 135 of the Companies Act, 2013 concerning Corporate Social Responsibility together with Rules thereunder and revised Schedule VII were notified on 27 February 2014 to come into effect from 01 April 2014.

Symphony welcomes the initiative taken by the MCA with an objective to embrace responsibility for the corporates actions and to motivate a positive effect through its activities on promoting education, environmental sustainability, rura development, communities and all other members of the public domain who may also be considered stakeholders

YourCompany, being covered underthe provisions of the said Section, has constituted a Committee of Directors, titled "Corporate Social Responsibility Committee" comprising of the following 3 Directors as its members:

Mr. Achal Bakeri, Chairperson

Mr. Nrupesh Shah, Member

Mr. Himanshu Shah, Member (Independent Director)

The role of the Committee is to formulate and monitor the CSR Policy of the Company. The

Committee has formulated a CSR Policy, which has been approved by the board

Since the said section has been enacted w.e.f. Apri 01, 2014, prescribed details as required under the said Section shall be presented to the members in the annual report for the year 2014-15.

14] Secretarial Audit Report

As a step towards good corporate governance practice, the Board of Directors of your Company appointed Mr. Ashwin Shah, practicing Company Secretary, to conduct Secretarial Audit. The Secretarial Audit Report for the accounting year ended June 30, 2014 is provided in the Annua Report.

The Secretarial Audit Report confirms that the Company has complied with all the applicable provisionsofthe Companies Act, 1956, Companies Act, 2013, Depositories Act, 1996, Listing Agreements with the Stock Exchanges, Securities Contracts (Regulation) Act, 1956 and various Regulations and Guidelines of SEBI as applicable to the Company, including the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992.

15] Directors

The Board of Directors at their meeting held on August 20, 2014 appointed Mr. Satyen Kothan and Ms. Jonaki Bakeri as Additional Directors and they shall hold office till the ensuing Annua General Meeting of the Company.

As per the provisions of section 149 and other applicable provisions of the Companies Act, 2013 and rules made thereunder and also as per Listing Agreement, the Board has appointed Mr. Satyen Kothari, Mr. Himanshu Shah and Mr. Dipak Palkar as non-executive independent directors for a period of consecutive five years and they shal not be liable to retire by rotation. The Board has appointed Ms. Jonaki Bakeri as a non-executive director liable to retire by rotation

Mr. Nrupesh Shah, Director of the Company retires by rotation at the ensuing annual genera meeting and being eligible, has offered himself for reappointment.

Brief profile of aforesaid directors, as required under clause 49 of the Listing Agreement, is annexed to the notice convening the 27th Annua General Meeting, which forms part of this Annua Report. Your directors recommend appointment of all above Directors.

16] Fixed Deposit

The Company has not accepted any public deposit during the year under review and no unclaimed deposits or interest was outstanding as of June 30,2014.

17] Insurance

The insurable interests of the Company including factory building, plant & machinery, stocks, vehicles, and other insurable interests like loss of profits, directors & officers'' liability etc. are adequately covered

18] Disclosure

In line with the requirements of Listing Agreement with the Stock Exchanges and the Accounting Standards of the Institute of Chartered Accountants of India, your Company has made additional disclosures in Notes on Accounts for the year under review in respect of related party transaction, calculation of EPS and deferred tax liability.

19] Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo

As required under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in Report of Board of Directors) Rules, 1988, details relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo are given in Annexure attached hereto and forming part of the Directors'' Report

20] Particulars of Employees

In terms of the provisions of section 217 (2A)of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended, names and other particulars of employees are set out in annexure to the Directors'' Report. Having regard to the provisions of section 219(1)(b) (iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any member interested in obtaining such particulars may write to the Company Secretary at the registered office of the Company

21] Acknowledgments

Your Directors wish to express their appreciation of the committed services by employees at all levels. Your Directors also wish to place on records their deep sense of appreciation for the valued support & co-operation by OEMs, distributors, dealers, service franchisees, suppliers, C&FAs, bankers and all other stakeholders of the Company and look forward to their continued association with the Company. The Company will make every effort to meet the aspirations of its Shareholders.

For and on behalf of the Board

Achal Bakeri

Place : Ahmedabad Chairman and

Date : August 20, 2014 Managing Director


Jun 30, 2013

To The Members of Symphony Limited

The behalf of the Board of Directors, I have great pleasure in presenting to you, the 26th Annual Report and Audited Accounts on standalone as well as consolidated basis for financial year ended on June 30, 2013.

1] A) Financial Results

(Rs.in Lacs) Standalone Consolidated Particulars 2012-2013 2011-2012 2012-2013 2011-2012

Revenue from Operations & Other Income 32,512 25,849 39,473 31,974

Profit before Financial Costs, Depreciation & Taxation 9,404 7,214 9,587 7,886

Less: Financial Costs 51 67 62 75

Less: Depreciation & Amortization Expenses 131 169 394 486

Profit before Tax 9,222 6,978 9,131 7,325

Less: Current Tax 2,522 1,957 2,522 1,957

Less: Deferred Tax (4) (13) 151 57

Less: Provision for tax of earlier years 436 436

Less: Loss from discontinuing operations 11 1

Profit after Taxation 6,268 5,034 6,011 5,310

Balance as per last year''s Balance Sheet 10,300 8,252 11,222 8,898

Amount available for Appropriation 16,568 13,286 17,233 14,208

Less: Transfer to General Reserve 1,000 750 1,000 750

Less: Proposed Dividend & Dividend Tax 2,660 2,236 2,660 2,236

Balance at the end of year 12,908 10,300 13,573 11,222

B) Other Key Financials as on June 30, 2013

Consolidated Financial Results

In order to provide a better understanding of performance of the company in view of its global operations, we present hereunder the consolidated results of Symphony and its global subsidiaries in addition to the company''s financial performance from Indian operations on standalone basis. The company scaled new heights and benchmarks in terms of sales and profits for financial year ended on June 30, 2013. The company''s consolidated total revenue increased to Rs.39,473 Lacs from Rs.31,974 Lacs in the previous year, recording a robust growth of 23%. The consolidated profits after tax for the financial year under review increased to Rs.6,011 Lacs as against Rs.5,310 Lacs in the previous year registering a growth of 13%. During the year under review, the company recorded a robust growth of 17% in its consolidated net worth.

Key Financials

Management and Discussion Analysis forming part of this Annual Report provide detailed information and analysis of financial results for the year under review.

2] Dividend

Your directors have pleasure to recommend a dividend of Rs.6.50 (325%) per Equity Share having face value of Rs.2/- for the financial year ended June 30, 2013 [last year Rs.5.50 (275%) per Equity Share having face value of Rs.2/-, which was comprised of Rs.3/- per Equity Share as normal dividend and Rs.2.50

as a Silver Jubilee Year Special Dividend.]

The dividend payout for the year under review has been formulated in accordance with shareholders'' aspirations and the company''s policy to pay sustainable dividend; linked to long term growth objective of the company to be met by internal cash accruals. The total pay out on account of dividend is Rs.2,660 Lacs, the highest ever pay out by the company since inception. This translates into a dividend pay out ratio of 42.44% (including dividend distribution tax) on standalone profit.

3] Performance Review

Year 2012-13 proved to be a challenging year amidst global economic uncertainties and disturbances in many parts of the world. Despite such constraints and challenging environment, your company in the year 2012-13, recorded an encouraging performance regardless of the inflationary environment, increasingly competition and the challenging market environment. During the year under review notwithstanding the above your company outshined its past track record and achieved a robust performance both in terms of volume and sales revenue. There was stock out position for personal coolers in peak season. Your company has made it possible by effective initiatives which focused on consumers and development of market network with emphasis on innovation, greater efficacy and environment friendly products, while strengthening organisational leadership. Your company''s business continues to grow strongly in double digits. Your company continues its focus on cost control, inventory management and productivity enhancement to improve margins. Your company also endures to lay emphasis on cash generation driven by strong performance, focus on efficiencies, cost management and continued efficient collection system.

Your company along with its subsidiaries has been able to expand more capacities, register encouraging performance, expand into new geographies, strengthen its market network. Further, over the years, your company has consciously developed its intellectual property rights in form of trademarks, copy rights and designs etc. for different models of air coolers as well as of logo and corporate brand "Symphony". Today, your company enjoys large number of registrations in India as well as in several countries world over. Your company firmly believes that its trademarks and designs have considerable value and significance which greatly help in marketing its products. Brand "Symphony" today is the most trusted brand in air cooler industry in the country as well as in many parts of the world.

Your company sustained its focus to magnify its nationwide market network and at present it has 766 distributors and 16,400 dealers representing about 4,500 towns with adequate warehousing facilities in all strategic locations to cater to every nook and corner of the country. Your company strengthened its operating structure of marketing function to capture the vast dormant markets of the nation. On ‘After Sales Service'' front, your company has also enlarged its network of service franchisees with ‘Nation Wide Customer Care Number'' to cover important towns all over the country for timely and resourceful after sales service. Your company managed investments prudently by deploying surplus funds after ensuring that such investments satisfy the company''s criteria of safety and security.

Air coolers - Domestic Operations Business of the company continued its growth journey during the year with extensive market network as well as enlargement of dealer network. During the financial year, your company strengthened its leadership position in air cooler industry by consistent growth in terms of sales volume. Your company achieved its goals by focusing on strategic initiatives which inter-alia comprise of engaging to promote own brand, innovation for growth, being effective and efficient and leading to win.

Well planned and successful marketing strategies have made Symphony coolers a much preferred choice in competitive environment. Customer focus, quality and power saving have been core strengths of the company.

To keep pace with growing demand for our products, the company is constantly exploring options for augmenting capacity at the existing locations and also by tying up with new original equipment manufacturers in strategic locations.

Year 2012-13 was marked by significant advance in our R & D initiatives in the products of the company, which added momentum to its growth journey. It has been constant endeavour of your company to instigate innovations so as to offer an extensive selection for different customers of air coolers in terms of different models and features to suit their individual requirement.

Your company during the year under review, introduced 6 new models of ‘i'' series air coolers (intelligent coolers with features such as empty tank alarm, full remote function, memory restore function etc.). It also launched air coolers with ‘dura pump technology'' having pump with long life to grab potentiality of the unexplored market. Your company together with its subsidiaries offers 87 models of air coolers for almost all categories of customers to cater to their needs for air coolers, manufactured either in house or out sourced.

A visible evolution in pattern of rural areas consumption has been phenomenal, with increasing demand for quality products. The very charm of the Indian consumer market is leading to steep competition among the key players which has been encountered by your company through strategic advertising and promotional drive to prevail upon the consumers by offering superior value for every rupee spent. Your company penetrated into new markets with firm focus on emerging markets which are currently outpacing growth in developed market reiterating our emphasis in these geographies. The organisation offer value added air cooler models to complement the evolving needs of global markets.

To meet need for expanding business, your company has strengthened its marketing team by employing competent team of marketing

professionals in India as well as in several countries of its operations.

With a view to fully leverage all these improvements and strategies, the advertising campaign in 2013 season was far more aggressive compared to the previous year. The aggressive advertisement campaign was formulated only after in-depth workshop to evaluate communication strategy to cultivate the air cooler market. Your company communicated India''s cooling needs are diverse and how Symphony air cooler meets all the needs. "Symphony cooler" is positioned as "India ka cooler, India ko rakhe cooler."

Modern Trade

Symphony continued to become stronger in modern trade with remarkable growth over the previous year and also proved to be a leading air cooler brand in retail. The company became more aggressive in e-commerce resulting into growth through leading e-commerce sites.

The modern trade channel continued to be a growth engine to the company''s business as it drives growth by better shopping experience. Your company continued to broaden its market network to penetrate with greater space. Your company now enjoys significant portion of the organised retail chain in the country. Your company believes that the Modern trade is growing at a fast clip and is optimistic to exploit its potentiality.

Industrial Air Coolers

Industrial Cooler business of the company is in nascent stage and the focus has been to strengthen the business. The company has developed in-house air cooling project design facilities with a dedicated resource. Another important step undertaken by your company is to create a productive base of dealer network across the country.

The overall business has shown remarkable growth during the year under review to the tune of 107% over business of industrial cooler of previous year. Also the company has strengthened its manpower across the country to capture the untapped market of Industrial Cooler business.

Your company has made some major breakthroughs in terms of entry into new customer segments like paint industry, logistics, moulding industry, auto Industry, carpet industry, religious sector, bakery, FMCG companies, food industry, educational institutes, auditorium, bottling plant, etc. Your company has also received repeat orders from some customers to whom industrial coolers were supplied earlier which establishes their trust in the company and its products.

Your company has also started a novel concept of air cooling the railway running rooms and waiting halls etc. Also, the company has made inroads with approvals from some key opinion makers like HVAC consultants and big HVAC Contractors.

The year under review also witnessed many business developmental activities like participation in many exhibitions, CII expos, Ishrae and Ashrae meets and advertisement in many HVAC journals and newspapers with overwhelming response. An innovative digital campaign was also initiated which was successful.

Air coolers - Overseas Operations The company continued its focus on exports in 2012-13. Presently, your company exports to about 60 countries and there is a huge potential yet to be tapped. During the year, Symphony increased its spread in Latin America and Africa.

In the year 2012-13, the export revenues [including subsidiary viz. Impco S.DE. R.L.DE. C.V, Mexico (Impco)] were Rs.3,533 Lacs as compared to Rs.4,096 Lacs in the previous year. Though, there is a reduction in overall international sales, if we take out exports made to Impco from international sales, then there is robust increase of about 40% in sales value to rest of the world and price realization has gone up in excess of 6%. During the year, Symphony added some new countries like Ecuador, Bolivia, Armenia, Kazakhstan and Mauritius; recently Symphony has finalised a large distributor in Pakistan.

In export market, as a revised strategy the focus is on large markets. The strategy is to focus on some of the large and important select markets and to work in a focused way. Symphony has also planned to have a warehouse in Europe to enhance penetration in EU. It is also in process of establishing a branch in UAE. This will help substantially to increase sales in Middle East and North African countries. Your company also continues its focus on exports primarily to MENA, Latin America etc.

Symphony continues to have various international quality certifications like CE, SASO, ETL, NOM, KUCAS, GS certificate from Germany etc which give access to other countries as well..

Impco S.DE. R.L.DE. C.V, Mexico Coming to operations of subsidiary of the company, viz. Impco S.DE. R.L.DE. C.V, Mexico (Impco), it has registered subdued performance during the year. Sales have not happened as per the plan. This is mainly on account of delayed season, which affected entire air cooling industry including air conditioners, air coolers and fans. As a result of that even service centre sales got affected to some extent. Consequently, though overall overheads were almost the same as per the last year margins were under pressure and hence the performance. Impco has already identified the necessary strategy and steps to be taken to improve the performance, just to narrate some of them, lean manufacturing project has been under discussion and will be implemented during the next year. The project is being implemented basically to have improved control on costs, including manufacturing costs, inventory costs and also to further rationalise inventory level.

SEZ Unit at Sachin, near Surat in Gujarat The performance of SEZ Unit of the company at Sachin, near Surat in Gujarat during the year under review was quite encouraging. The SEZ unit entails various benefits, including 100% income tax exemption on export profits from SEZ unit.

4] ICAI Award for Excellence in Financial Reporting:

Your company''s Annual Report and Accounts ended on 30th June 2011, for consecutive second year, have been adjudged as the winner of an award under the category VII-Manufacturing Sector (Turnover less than Rs.500 Crores) of the "ICAI Awards for Excellence in Financial Reporting".

5] Corporate Governance

Your company strives to maintain high standards of Corporate Governance in all its interactions with stakeholders. The company continues its endeavour to be a sustainable and trusted organisation as sustained governance is the corner stone in building and maintaining relationships with all its stakeholders. The company''s relationship with its stakeholders is an important component of Corporate Governance. An ongoing interaction with investors and communicating information about the company in an unswerving and credible manner helps to establish a transparent relationship. It rigorously follows a policy of 100% compliance with all statutory requirements and has a healthy system to review them.

The CMD, Executive Director and Chief Financial Officer (CFO) have certified to the Board regarding the financial statements and other matters as required in clause 49 of the Listing Agreement and the said Certificate is contained in the report. A Certificate from the auditors of the company regarding compliance of conditions of Corporate Governance as stipulated under clause 49 of the Listing Agreement is also annexed. All the Board members and senior management employees have affirmed compliance with the Code of Conduct.

The Board has implemented a Code of Business Conduct and an "Ethics Code" aimed at members and senior management to inculcate business ethics in the company in their dealings with employees and business associates. Report on Corporate Governance forms an integral part of this Annual Report.

6] Trade Relations

Your directors wish to record appreciation of the continued unstinted support and co-operation from its retailers, stockists, suppliers of goods / services, clearing and forwarding agents and all others associated with the company. Your company will continue to build and maintain strong link with its business partners.

7] Management Discussion and Analysis Report

Management Discussion and Analysis Report for the year under review as stipulated under clause 49 of the Listing Agreement with Stock Exchanges in India, is presented in separate section forming part of this Annual Report.

8] Human Resources:

The employee relations in the company continued to be cordial. Over the years, your company''s focus has increased towards human capital. Your company believes that the support of human capital is of utmost importance to sustain the market leadership in all products segments and also to capture markets. The company firmly believes that employees are the most vital assets and key differentiators of business success.

In order to enhance the efficiency and effectiveness, the company instituted several employees friendly policies and employees development programmes, across all levels, to enthuse a vibrant work culture and ensure that the workforce remains invigorated and motivated. Your company has also successfully migrated to an improved Performance Management System to identify the high performers and reward appropriately which has helped to achieve better employee engagement score. We are striving to build a performance driven culture and create an environment conducive for employee growth.

9] Directors

Pursuant to the provisions of the Companies Act, 1956 and Articles of Association of the company, Mr. Himanshu Shah, Director of the company retires by rotation at the ensuing Annual General Meeting, and being eligible, offers himself for re- appointment. Your directors recommend his re- appointment.

10] Fixed Deposit

During the year under review, the company has not accepted any fixed deposit from the public and as on June 30, 2013 the company does not hold any unclaimed deposits or interest thereon.

11] Branch at UAE

Symphony is in process of establishing a branch in U.A.E, which is an important hub for trading activities for MENA region - ‘Middle East North Africa''. This region includes GCC countries (Gulf Cooperation Council), other Middle-eastern countries and North African countries. The whole of this region has vast and promising markets for air coolers. Your directors believe that on opening of this branch, the company foresees to expand its presence in this area.

12] Subsidiaries

The company during the year under review, has fully subscribed 37,00,000 equity shares each of

US$ 1 (fully paid up) issued by its subsidiary i.e. Sylvan Holdings Pte. Ltd., Singapore.

During the year under review, to realign and consolidate the business being carried out by the subsidiaries of the company, it has been decided to close down Symphony Air Coolers Inc., USA. The business of Symphony Air Coolers Inc. will be taken care by the Symphony USA Inc., subsidiary of the Impco S.DE. R.L.DE. C.V., Mexico, which is also a step down subsidiary of the company. Consolidation exercise and consequent reduction in the number of subsidiaries will help in enhancing operational flexibility, efficiencies and greater and optimal utilisation of resources and also lead to significant reduction in the multiplicity of legal and regulatory compliances.

Your company has two subsidiary companies (and two step down subsidiary companies) i.e Sylvan Holdings Pte. Ltd., Singapore, (Sylvan) and Symphony Air Coolers Inc. USA. Sylvan has a subsidiary company in Mexico i.e. Impco S.DE. R.L.DE. C.V. (Impco), which manufactures and markets a variety of industrial and small coolers. Impco, in turn, has a subsidiary company in USA, namely Symphony USA Inc., which markets a variety of coolers.

Except this, there is no material change in the nature of the business of the subsidiaries.

Pursuant to the provision of Section 212 (8) of the Companies Act, 1956, the Ministry of Corporate Affairs vide its circular dated February 8, 2011 has granted general exemption from attaching the Balance Sheet, Profit & Loss Account and other documents of the subsidiary Companies with the Balance sheet of the company. The company will make available the Annual Accounts of the subsidiary companies and the related detailed information to any member of the company, who may be interested in obtaining the same. The annual accounts of the subsidiary companies will also be kept open for inspection at the Registered Office of the company. The Consolidated Financial Statements presented by the company include the financial results of its subsidiary companies.

13] Consolidated Financial Statements

In accordance with the Accounting Standard 21 on Consolidated Financial Statements, the audited consolidated financial statements have been prepared and are provided in Annual Report pursuant to clause 32 of the Listing Agreement entered into with Stock Exchanges.

14] Director''s Responsibility Statement

Pursuant to sub-section (2AA) of Section 217 of the Companies Act, 1956, the Board of Directors of the company hereby states and confirms that: i. in preparation of the Annual Accounts, applicable accounting standards have been followed and there has been no material departures; ii. such accounting policies have been selected and applied consistently, and judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at June 30, 2013 and of the profit of the company for that period; iii. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities; i v. the annual accounts have been prepared on a going concern basis.

15] Insurance

Insurable interests of the company including

Factory Building, Plant & Machinery, Stocks, and Vehicles etc. are adequately insured.

16] Disclosure

In line with the requirements of Listing Agreements with Stock Exchanges and the applicable Accounting Standards, your company has made disclosures in Notes on Accounts for the year under review in respect of related party transactions, calculation of EPS and deferred tax liability.

17] Reduction in Contingent Liability

Your Directors are happy to inform that the disputed sales tax demand against the company of Rs.4,425 lacs (out of total Rs.4,429.67 lacs) as stated at Notes to Accounts (28) b) has been favourably decided by the Gujarat VAT Tribunal vide its order dt. October 8, 2013. The said contingent liability therefore ceases to exist w.e.f. October 8, 2013.

18] Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo

As required under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in Report of Board of Directors) Rules, 1988, details relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo are given in Annexure attached hereto and forming part of the Directors'' Report.

19] Particulars of Employees

In terms of the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended, names and other particulars of employees are set out in annexure to the Directors'' Report. Having regard to the provisions of Section 219(1)(b) (iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all the members of the company others entitled thereto. Any member interested in obtaining such particulars may write to the company secretary at the registered office of the company.

20] Corporate Social Commitments

Your company is committed to play its role as an enlightened corporate citizen and endeavours to reach out to the underprivileged in and around the areas of its operations.

21] Auditors

M/s. Shah & Dalal, Chartered Accountants, Ahmedabad, hold office as Auditor of the company until the conclusion of the ensuing 26 Annual General Meeting and the Board recommends their appointment till the conclusion of next Annual General Meeting.

The company has received a certificate from Auditor to the effect that their appointment, if made, would be within the prescribed limits under Section 224(1B) of the Act.

22] Cost Auditors

Pursuant to Cost Audit Branch Order dated November 6, 2012, issued by Ministry of Corporate Affairs, M/s. Dalwadi & Associates, Cost Accountants, have been appointed as Cost Auditors for the financial year ending June 30, 2014 with approval of Central Government.

The cost compliance report for financial year 2011- 12 was filed by the company on September 29, 2012. Further the cost audit report for the financial year ended June 30, 2013 will be filed within prescribed time period.

23] Secretarial Audit Report

As a step towards good corporate governance practice, the Board of Directors of your company appointed Mr. Ashwin Shah, practicing Company Secretary, to conduct Secretarial Audit. The Secretarial Audit Report for the financial year ended June 30, 2013 is provided in the Annual Report.

The Secretarial Audit Report confirms that the company has complied with all the applicable provisions of the Companies Act, 1956, Depositories Act, 1996, Listing Agreements with Stock Exchanges, Securities Contracts (Regulation) Act, 1956 and various Regulations and Guidelines of SEBI as applicable to the company, including the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992.

24] Acknowledgement

Your Directors sincerely appreciate the high degree of professionalism, commitment and dedication displayed by employees at all levels.

Your Directors also gratefully acknowledge the support and co-operation extended to the company by the OEMs, distributors, dealers, service franchisees, suppliers, C&FAs, bankers and all other stakeholders of the company and look forward to their continued patronage. The Directors also wish to place on record their gratitude to the Members for their continued support and confidence.

For and on behalf of the Board

Place : Ahmedabad. Achal Bakeri

Date : October 29, 2013 Chairman & Managing Director


Jun 30, 2010

The Directors have pleasure in presenting herewith their Report together with the Audited Balance Sheet as at June 30, 2010 and Profit & Loss Account for the year ended June 30, 2010.

A) Financial results [Rs in Lacs]

Particulars Current accounting Previous accounting year year ended on June ended on June 30, 2009 30, 2010

Gross revenue 19,359 12,678

Profit before financial charges and depreciation 5,721 4,077

Less: Financial charges 57 16

Less: Depreciation 130 115

Profit before taxation and exceptional income 5,534 3,946

Exceptional income - 1,977

Profit before taxation & after exceptional items 5,534 5,923

Taxation & fringe benefit tax 1,865 1,532

Deferred tax liability (24) 66

Profit after taxation 3,693 4,325

Balance as per last year balance sheet 2,332 (1,411)

Amount available for appropriation 6,025 2,914

Transfer to General Reserve 500 500

Proposed dividend and dividend tax 204 82

Balance carried to balance sheet 5,321 2,332

B) Other key financials as on June 30, 2010

Equity share capital : Rs.700 lacs

Net worth : Rs.8,620 lacs

Book value per equity share : Rs.123

Earning per share (EPS) : Rs.53

Investments : Rs.5,349 lacs

Contribution to exchequer : Rs.4,554 lacs

Your Company is a debt free company with an opportunity to leverage the balance sheet for sustainable growth.

2.Dividend

Your Directors are pleased to recommend a dividend of Rs.2.50 (25%) per equity share (last year Rs.1 (10%) per equity share) for the financial year ended June 30, 2010. The dividend payout ratio for the year under review, inclusive of corporate tax on dividend distribution, is at 5.52% compared to 1.89% for the previous year 2008-09.

3. General overview and review of operations

Emerging out of the economic turmoil witnessed in the recent past, the Indian Economy, particularly the industrial sector, reported a sustained resurgence in the year 2009-10, buoyed by enhanced consumer confidence, upturn in investment sentiments, increased exports in later part of the year and enhanced availability of institutional funds. Consumer demand remained buoyant during the year 2009-10, benefiting significantly from the roll out of the pay commission related benefits to central and state employees. The soaring growth of the capital goods sub-sector during the later part of the year under review is a pointer to the beginning of investment-led growth along-with consumption-led growth.

Although, the rising inflation and sharp currency fluctuations had negatively affected certain sectors of the Indian economy, on the whole the year 2009-10 saw the Indian economy emerging as one of the fastest growing economies in the world. The Reserve Bank of India (RBI) faces the challenge of having to balance its monetary policy in a way that inflation is contained without disrupting growth. The Government of India also faces another challenge as it withdraws the monetary stimuli that it had introduced earlier in the wake of economic slowdown in the recent past. Notwithstanding the challenges, Indias position as one of the fastest growing and promising markets is expected to remain in tact with domestic demand being sustained at high levels.

4. Review of operations

In a year which was beset with external challenges such as below average monsoons, drought in some parts of the country, rising inflation and sharp currency fluctuations, your company continued to report strong growth in its sales across geographical boundaries. In spite of sharp fluctuations in input costs and high overall inflation, the Company was able to manage costs well leading to a sizeable increase in operating margins during the year on all fronts, both in the domestic and international markets and improved performance in terms of various indicators such as sales turnover and profitability.

Viewed against the background of rising inflation and sharp currency fluctuation, which has adversely affected some Indian companies also, the performance of the Company represents a truly remarkable achievement. During the year under review, your Company recorded one of its highest revenue growths since its inception, recording robust volume-led growth through the introduction of new and improved models of air coolers and water heaters and also by penetrating into interior markets of the various states apart from major cities and capital towns. In spite of sharp fluctuations in input costs and overall inflationary pressures, the Company was able to manage cost well leading to a sizeable increase in operating margins during the year.

The year of 2009-10 was a landmark year for your company for its operating performance. In the year 2009-10, your Company scaled new heights and set several benchmarks in terms of sales, profits and net worth, among others. Your Company in the year of 2009-10, achieved a sales turnover of Rs.18,977 lacs representing a growth of 53% over the previous years sales of Rs.12,422 lacs. The Company recorded a note-worthy Profit Before Tax (before exceptional item) of Rs.5,534 lacs, an increase of 40%, as compared with previous year of Rs.3,946 lacs. The Company also recorded significant Profit After Tax of Rs.3,693 lacs, as compared with last year Rs.2,857 lacs [excluding exceptional income].

The thrust of your Companys efforts continues to be directed towards achieving better margins. This has been driven by several factors, including various value engineering initiatives, better product design, higher efficiency in supply chain management and higher off season sales during the year. The Company could achieve substantial reduction in operating cost through a number of initiatives such as global sourcing for critical capital items and components, including hard negotiation of prices with the suppliers and approving new supplier lines, thus ensuring cost efficiency and sustainability of the margins. Through all these activities the Company retained its focus on quality, manufacturing excellence, with rigour.

Your Company has been upgrading its existing equipment and infrastructure and employs state-of-the-art technology with the objective of achieving substantial improvements in productivity and efficiency. Your Company has continued to initiate a series of steps to rationalise the marketing network, optimise the product mix, and effect substantial cost reduction with a view to bringing in major increases in domestic and international sales. The Company renewed its thrust on enhanced after sales service by strengthening its network of authorised service providers in all metros and other major towns all over the country.

The international business too continues on its growth trajectory, and forayed into newer markets. The Company has now emerged as a strong multi-location transnational business with a presence across 54 countries and catering to the ever-changing needs and aspirations of the local populations in these markets.

In addition to steady growth in its existing business, Symphony is also focusing on synergistic growth and opening up of new vistas of opportunity for the Company. With the positive outlook for the economy, it is quite reasonable to set ambitious targets for the Company and your Directors are confident of achieving them.

Air coolers

Your Company is a pioneer in manufacturing of air coolers with plastic body and is now one of the largest suppliers of the air coolers in the domestic market with a wide range of products offering a variety of attractive features. Innovative models of air coolers with superior performance, design and features, designed to work under demanding operating conditions, have been launched in the market. Presently, the Company has 13 models of air coolers in various sizes tailored to the needs of a wide range of customers. A focal point for the Companys business is tapping the vast potential of the Indian rural markets. To implement this, changes have been made in the sales operating structure by penetrating into the rural areas of the Indian market.

Unlike the dry artificial air of an air conditioner, Symphony evaporative air coolers deliver cool and moist air. This technology being completely natural, there are no emissions of harmful CFCs. Symphony evaporative air coolers are packed with exclusive features and state- of-the-art design, coupled with dependability and consistent efficiency. Symphony air coolers are ideal for residences, shops, show rooms, offices and outdoor applications as well.

Symphony air coolers come with a distinctive power saver technology. This technology is the outcome of sophisticated R&D efforts using the latest engineering and computing techniques. This helps to make Symphony evaporative air coolers energy-efficient and economical.

Types of air coolers manufactured by Symphony are:

- Personal coolers

- Room coolers

- Desert coolers

- Tower coolers.

The Company meets the highest standards of excellence for air coolers. The Companys air coolers have been awarded the CE mark, which is European standard for safety. This helped the Company in introducing its air coolers in European countries like UK, Spain, among others. Most of the models of air coolers were also awarded the Saudi Arabian Standard Organisation (SASO) mark, which is required for selling our products in Saudi Arabia. Most of our models, including the Sumo, Jumbo, and Hi-cool also succeeded in getting the ETL mark, which is the highest standard of quality in the United States of America.

In view of overall growth of the Indian economy, and the prevalence of extended summers with higher temperatures, the demand for air coolers in the domestic market has been increasing year by year. The growth rate of coolers in the domestic market is impressive and is a pointer to the changing mindset of the domestic consumers to move towards the reliability and elegance of a branded cooler.

During the year under review, strategic initiatives have been taken to increase the number of our trade partners by appointing a new set of dealers. The Company has also strengthened its service infrastructure by appointing more franchisees. With these measures, the Company is confident of being able to meet a variety of customer needs under different geographical conditions.

The Company is operating with over 450 distributors and 6,500 dealers together with adequate service franchises through the country- wide network. With a promising market for its innovative products, your Company is confident of achieving a sizable growth in its operations.

Water heaters

The Company is also manufacturing instant and storage water heaters in various sizes. Symphony water heaters are available in different capacities under Sauna brand name. These are technically, feature- wise and aesthetically far superior water heaters and are well accepted in the market.

Sauna water heaters with double insulation technology have yielded good response and wide acceptance. Sauna water heaters have the distinction of being the first water heaters to get a 5 star rating from the Bureau of Energy Efficiency, Govt, of India. The sauna geysers are built with hi-density polyurethane foam with a second layer of special glass wool insulation that minimises heat loss and maximises energy saving.

The Company expects brighter scope for overseas market for these models of water heaters in the years to come, considering the potential features of the models.

Focus on exports

During the year under review, the exports revenues of the Company grew by 20% from Rs.2,589 lacs in 2009 to Rs.3,102 lacs in 2010. The Company foresees a promising future for the export sector in the years to come. It is noteworthy that the export performance of the Company has been achieved in the face of sluggish demand in overseas markets, and under conditions in which most Indian companies have remained stagnant or registered negative growth in exports.

Your Company has adequately strengthened its export team with a region-wise focus to capitalise on potential overseas opportunities. This will allow the Company to foray into new countries and to obviate the seasonality factor of the business. Your Company has exported to 54 countries. There are many more countries in which there is an excellent scope for promoting the sale of coolers, and efforts are being made to tap these new markets.

In addition, your Company is also persistently on the lookout for growth opportunities in various overseas markets through joint ventures and acquisitions. With these initiatives, the Company is certain of being able to leverage the growing overseas market as a commanding growth engine.

5. Change in the name of the Company "Symphony Limited"

In terms of the resolution approved at the last Annual General Meeting of the Company, your Company received the approval of the Central Government for the change in its name to "Symphony Limited" from its former name "Symphony Comfort Systems Limited". There is no change in the nature of the business of the company during the year.

6. Corporate Governance

Symphony is committed to good Corporate Governance and understands and respects its fiduciary role in the corporate world. The Board and its Committees have always endeavoured to pursue growth by adhering to highest standard of corporate governance. It has taken steps to strengthen the framework of Corporate Governance and Internal Audit system of the Company during the year. The Board and Audit Committee have been actively engaged in discussing reports of Internal Auditors and advising on monitoring the implementation of their recommendations.

The Board has implemented a Code of Business Conduct and an "Ethics Code" for its members and for members of Senior Management to inculcate business ethics in the Company in their dealings with employees and business associates,

A report on Corporate Governance and Management Discussion and Analysis, as required under clause 49 of the Listing Agreement is annexed.

The CEO and Chief Financial Officer (CFO) have certified to the Board regarding the financial statements and other matters as required in clause 49 of the Listing Agreement and the said Certificate is contained in the report. A Certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement is also annexed. All the Board members and Senior Management personnel have affirmed compliance with the Code of Conduct.

7 Directors

Pursuant to the provisions of the Companies Act, 1956 and Articles of Association of the Company, Dipak Palkar, Director of the Company retires by rotation at the ensuing Annual General Meeting, and being eligible, offers himself for re-appointment. Your Directors recommend their re-appointment.

8. Fixed Deposit

During the year under review, the Company did not accept any fixed deposit from the public and on June 30, 2010 the Company had no unclaimed deposit or interest thereon due to any depositor and out standing deposit is Nil.

9. information systems

In order to strengthen the internal control systems and improve the management information systems, in the year 2008-09, the Company installed SQL server based ERP which went live. The Board is pleased to state that now the application has been successfully implemented and the system has stabilised well. The Board places on record its deep sense of appreciation for the contribution made by the employees of the Company in rolling out the SQL server based ERP.

10. Segment-wise performance

The Company is engaged in the business of air coolers and water heaters, both of which are governed by the same set of risks and returns. In view of this, the entire business of the Company comes under one primary segment, namely that of "Appliances".

However, domestic sales and exports sales are two secondary geographical segments, and appropriate disclosures have been made in the Notes to the Accounts.

11. Consolidated financial statements

In compliance with the Accounting Standard 21 on Consolidated Financial Statements issued by the Institute of Chartered Accountants of India and Clause 32 of the Listing Agreement with the Stock Exchange, this Annual Report also includes Consolidated Financial Statements for the financial year 2009-10 for its subsidiary company i.e Symphony Air Coolers Inc.

During the year under review, Sylvan Holdings Pte. Ltd., Singapore ceased to be a subsidiary of the Company on account of equity holding of the Company being less than the statutory limit prescribed under the Companies Act, 1956.

12. Compliances of accounting stHcaa^cis

The Institute of Chartered Accountants of India (ICAI) has from time to time introduced many accounting standards for consistent application of accounting principles and transparent disclosures by corporate entities. Your Company opted for substantial compliance of all mandatory accounting standards, wherever applicable, except as stated by Auditors in their report, if any.

13. Directors Responsibility Statement

Pursuant to sub-section (2AA) of Section 217 of the Companies Act, 1956, the Board of Directors of the Company hereby state and confirm that:

(i) In the preparation of the Annual Accounts, the applicable accounting standards issued by The Institute of Chartered Accountants of India and requirements of the Companies Act,1956, were followed;

(ii) Such accounting policies were selected and applied consistently, and such judgments and estimates were made as were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company for the period ending on 30th June 2010 and of the profit of the Company for that period;

(iii) Proper and sufficient care was taken to maintain adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) The annual accounts were prepared on a going concern basis.

14. insurance

The insurable interests of the Company including factory building, plant & machinery, stocks, vehicles, and other insurable interests are adequately insured.

15. Disclosure

In line with the requirements of Listing Agreement with the Stock Exchanges and the Accounting Standards of the Institute of Chartered Accountants of India, your Company made additional disclosures in the Notes on Accounts for the year under review in respect of related party transaction, calculation of EPS and deferred tax liability.

16. Conservation of energy technology absorption and foreign exchange earnings and outgo

As required under Section 217(l)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in Report of Board of Directors) Rules, 1988, details relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo are given in the Annexure "A" attached hereto and forming part of the Directors Report.

17. Particulars of Employees

Pursuant to section 217(2A) of the Companies Act, 1956 and Rules made thereunder, a statement containing particulars of the Companys employees who were in receipt of the remuneration of not less than Rs.24,00,000 during the year ended June 30, 2010 or not less than Rs.2,00,000 per month during any part of the said year is given in the Annexure II to this Report.

18. Auditors

M/s. Shah & Dalai, Chartered Accountants, Ahmedabad, hold office as Auditors of the Company until the conclusion of the ensuing 23rd Annual General Meeting and the Board recommends their re- appointment till the conclusion of the next Annual General Meeting.

The Company received a certificate from Auditors under Section 224(1) of the Companies Act, 1956 to the effect that their re- appointment, if made, would be within the prescribed limits under Section 224(lB)oftheAct.

Members are requested to consider their re-appointment as Auditors of the Company for the current year at a remuneration to be decided by the Board of Directors.

19. Acknowledgements

Your Directors gratefully acknowledge the contributions made by the employees towards the success of the company. Your Directors are also thankful to the distributors, dealers, suppliers, C&FAs, vendors, and other parties dealing with the company for their valued support and co-operation and look forward to their continued association with the Company.

The Company will make every effort to meet the aspirations of its shareholders and wish to thank them sincerely for their whole hearted co-operation and support at all times.

For and on behalf of the Board

Place: Ahmedabad Achal Bakeri

Date : October 29, 2010 Chairman and Managing Director


Jun 30, 2009

The Directors have pleasure in presenting herewith their Report together with the Audited Balance Sheet as at 30/ 06/2009 and Profit & Loss Account for the year ended 30/ 06/2009.

1] A) FINANCIAL RESULTS:

[Rs. in Lacs]

Particulars Current Previous Accounting Accounting Year ended Year ended on 30.6.09 on 30.6.08

Sales and Other Income 12677.86 7411.49

Profit before Financial Charges and Depreciation 4150.01 1502.71

Less: Financial Charges 88.89 7.66

Less: Depreciation 114.84 92.55

Profit before Taxation & Exceptional items 3946.28 1402.50

Exceptional items 1976.70 Profit before Taxation &

after Exceptional items 5922.98 1402.50

Taxation & Fringe Benefit Tax 1532.08 166.38

Deferred Tax Liability 66.29 27.99

Profit/(Loss) after Taxation 4324.61 1208.13

Balance as per last year Balance Sheet (1410.46) (2618.59)

Amt. available for Appropriation 2914.15 (1410.46)

Transfer to General Reserve 500.00 -

Proposed Dividend & Dividend tax 81.85 -

Balance carried to Balance Sheet 2332.30 (1410.46)

B)Other Key Financials as on June 30,2009

- Equity Share Capital Rs. 699.57 lacs

- Net worth Rs. 5130.77 lacs

- Book Value per Equity Share Rs. 73.34

- Earning Per Share (EPS) (excluding Exceptional Items) Rs. 40.84 (with Exceptional Items) Rs. 61.82

Investments- Rs. 3137.78 lacs

Contribution to exchequer Rs. 2917.54 lacs.

Company is virtually debt free company. There is an opportunity to leverage the Balance sheet for sustainable growth.

2] DIVIDEND:

In view of excellent performance during the year under review, your Directors are pleased to recommend a dividend of 10% on the equity shares of the company for the year ended 30th June 2009. (Previous year nil). We are pleased to be back on the list of dividend paying company after a gap of 12 years, last dividend was declared in the year 1995- 96. Considering our future potential and prospects, we henceforth expect to continue as dividend paying company with sustainable increase.

3] GENERAL OVERVIEW:

The recent global recession triggered the collapse of well established institutions, including prominent investment banks, and resulted in insolvency of companies, job cuts, and liquidity crunch, all of which have had an extremely deleterious effect on the economies of various countries. The fallout of the global financial crisis on the Indian Economy has been palpable, and has also affected the consumer durable sector. As a company operating in this sector, your company was also affected by these developments.

While some segments, especially the export oriented industries, suffered more, particularly during the second half of the year, the Indian economy has by and large withstood the pressures imposed by a deteriorating global economic situation, and registered a growth rate of 6.7% in 2008-09. The economy continues to face wide ranging challenges on various fronts ranging from the need to improve its social and physical infrastructure, enhance the productivity in agriculture and industry, and address environmental concerns. Responding to these challenges will be critical to improving overall social and human development indicators. These issues will have a major impact on your companys performance, since overall development and improvement in the country will heip in accelerating our growth. In spite of these challenges, the economy of India has demonstrated its depth and resilience to be able to bounce back and register impressive growth. Our banking system is sound and well capitalized. The foreign exchange reserves position is fairly comfortable and the external debt position is comfortable. Inflation is under control, and is favourably positioned to enable control of costs in the manufacturing sector. Your directors are hopeful that the prevailing positive outlook on the Indian economy is well merited, and the development in the economy will help your company to be an active participant in this process, enabling it to reach new heights.

The Government of India also announced various stimulus packages including reduction in excise duty, service tax and incentives to exports. These measures have achieved the desired results. The Indian economy seems to be back on track especially in terms of recorded IIP, domestic demand and market sentiments. However, the global economy is yet to stabilize.

Against this background, the recent performance of your Company has been exceptional on all fronts, both in the domestic and international markets, and in terms of various indicators such as sales turnover and profitability. Given the positive outlook for the economy, it is quite reasonable to set ambitious targets for ourselves, and we are confident of achieving them.

4] • REVIEW OF OPERATIONS

During the year under review your company achieved a sales turnover of Rs. 12,422 lacs representing a growth of 70% over the previous years sales of Rs. 7324 lacs. Viewed against the background of an unprecedented global recession, which has affected most Indian companies also, these figures represent a truly remarkable achievement. Given such a performance in the midst of a global recession, your company is keenly alive to the possibilities that are likely to open up when the economic situation improves. In order to capitalize on these opportunities, and ensure continued and impressive growth, your company has already initiated a series of steps to rationalize the marketing network, optimize the product mix, and effect substantial cost reduction with a view to bringing in major increases in domestic and international sales. Your company has already upgraded its existing equipment and infrastructure and employs state-of-the-art technology with the objective of achieving substantial improvements in productivity and efficiency. Air coolers

It is not often that an organization gets an opportunity to combine comfort, innovation, elegance and efficiency in its products, while also contributing its mite towards improving the environment and reversing the harmful effects of global warming. Your company has achieved all this in the past year, while at the same time, ensuring an exceptional return to the investor. Your directors are aware that we could not have achieved this without the cooperation and encouragement that we have received from various quarters, and thank all those who helped us in making this possible in a year when the whole world has been reeling under an unprecedented recession. As a pioneer that elevated the status of what was once considered a low end product, and with a tradition of innovation and excellence going back more than two decades since its very inception, Symphony has, over the years, built on its core strengths to become a leader in the field of air coolers. The international recognition given to your company, as evidenced by the impressive growth in the export sales to over 25 countries, is an indicator to the new status that the product is gaining the world over. It also shows the trust that the world is reposing in your company and its products. The highly encouraging performance of our coolers in the international market is indicative of the potential that is waiting to be tapped. The growth rate of coolers in the domestic market is no less impressive and is a pointer to the changing mindset of the domestic consumers to move towards the reliability and elegance of a branded cooler. The power saver range of air coolers introduced by the company is not only eco-friendly and helps conserve power, but is also highly affordable. Given the features and the high value-for-money that this range-provides, the enthusiastic reception in the market to the product is hardly surprising. The other products of Symphony have seen several improvements and additional features, and have also been well received in the market. One of the strategic initiatives that we have taken this year is to increase the number of our trade partners. Consequently, the company plans to appoint a new set of dealers for focused marketing of the new range of DIET coolers. The company has also strengthened its service infrastructure by appointing more franchisees. With these measures, the company is confident of being able to meet a variety of customer needs under different geographical conditions.

The companys products are sold and serviced through a country-wide net work, with over 400 distributors and 6400 retailers promoting our air coolers during the season. Encouraging market demand for innovative products has motivated the company to introduce new models to meet the different requirements of various segments of consumers.

Water Heaters The Sauna model Water Heaters, which are offered in a variety of capacities, are technically and aesthetically superior to comparable models in the market. The company foresees a good potential for these models, and expects them to show impressive performance in the years to come. Sauna water heaters with double insulation technology have the distinction of being the first water heaters to get a 5 Star rating from the Bureau of Energy Efficiency - Govt, of India. The Sauna geysers are built with hi-density Polyurethane Foam with a second layer of special glass wool insulation that minimizes heat loss and maximizes energy saving. The contribution of water heaters to the total sales of the company has been minor so far, but the company envisages a significant growth in this product range in the future.

Focus on Exports During the year under review, the exports of the company grew by 172% from Rs. 952 lacs in 2008 to Rs. 2588 lacs in 2009. The company foresees a promising future for the export sector in the years to come. It is noteworthy that the export performance of the company has been achieved in the face of sluggish demand in overseas markets, and under conditions in which most Indian companies have remained stagnant or registered negative growth in exports. The Company has adequately strengthened its export team with a region-wise focus to capitalize on promising overseas opportunities. This will enable the Company to foray into new countries and to minimize the seasonality factor of the business. Presently, your company exports to about 25 countries. There are many more countries in which there is an excellent scope for promoting the sale of coolers, and efforts are being made to tap these new markets. In addition, your company is also constantly on the lookout for growth opportunities in various overseas markets through joint ventures and acquisitions. With these initiatives, the company is confident of being able to leverage the growing overseas market as a powerful growth engine.

5] RECOVERY OF BAD DEBTS WRITTEN OFF IN THE YEAR 2001-02

Your Directors had reported in the Annual Reports of 2000-01 and 2001 -02 that the Company had been dealing with various Regional Distributors since 1989. Over the years, these distributors had accumulated losses and hence the outstanding amounts payable by them to the company kept on mounting. Finally in 2001-02, after taking the opinion of experts, the company decided to write-off a total amount of Rs.2579.90 Lacs, which the distributors were unable to pay.

In view of the long-standing relationships that the company had built with these distributors, and the strategic advantages that the company could derive from continuing the relationships, it was decided that the company will continue to do business with them in spite of their earlier record. However, the commercial terms were revised such that no credit sales will be made to these parties in future. Realizing the need to be more self-reliant in this area, your company has, over a period of time, established its own distribution network, and has appointed its own sales, marketing & service personnel throughout the country, and has stopped dealing through the regional distributors.

As part of the continued efforts by the company to recover past dues, the matter was referred to the arbitrator, Ex. Justice of Gujarat High Court and Ex. Chairman of MRTP Commission in terms of the agreement between the company and the said distributors. The arbitration award was passed on 27th April, 2009 and in terms of the said order, the company has recovered Rs. 1976.70 lacs from the Regional Distributors and Rs. 1976.70 lacs has been shown as the Income for the year under review. Thus the company has recovered 76.62% of the total bad debts of Rs. 2579.90 lacs that had been written off.

6] DISCHARGE UNDER SICA IN VIEW OF POSITIVE NET WORTH OF THE COMPANY AND SANCTION OF REHABILITATION SCHEME In view of excellent performance and positive net worth of the company, your company ceases to be a "sick industrial company" within the meaning of Section 3(1 )(o) of the Sick Industrial Companies (Special Provisions) Act, 1985 and accordingly the BIFR has de-registered your company from the provisions of SICA. Your Company had filed a reference with BIFR u/s

15(1) of the SICA in the year 2002 and the company was declared as Sick Industrial Unit u/s 3(1 )(o) of the SICA. State Bank of India (SBI) was appointed as Operating Agency (OA). The Rehabilitation Scheme prepared by the company and appraised by SBI. The Draft Rehabilitation Scheme was sanctioned by the BIFR on 13.01.2009.

7] CORPORATE GOVERNANCE

The Board and its Committees have taken steps to further strengthen the framework of Corporate Governance and Internal Audit system of the Company during the year. The Board and Audit Committee have been actively engaged in discussing reports of Internal Auditors and advising on monitoring the implementation of their recommendations. The Board has implemented a Code of Business Conduct and an "Ethics Code" for the members and to members of Senior Management to inculcate business ethics in the Company in their dealings with employees and business associates, A report on Corporate Governance and Management Discussion and Analysis, as required under clause 49 of the Listing Agreement is annexed. The CEO and Chief Financial Officer (CFO) have certified to the Board regarding the financial statements and other matters as required in clause 49 of the Listing Agreement and the said Certificate is contained in the report. A Certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement is also annexed. All the Board members and Senior Management personnel have affirmed compliance with the Code of Conduct.

8] DIRECTORS

It is with profound grief that the Board of Directors inform the members, the sad demise of Mr. Anupam Yagnik, Director of the company, and place on record the sincere and valuable guidance received from him during his tenure of directorship in the company. Shri Himanshu Shah was appointed as an Additional Director by the Board with effect from April 30,2009 in accordance with the Article 148 of the Articles of Association of the Company and Section 260 of the Companies Act, 1956. Shri Himanshu Shah holds office only up to the date of forthcoming Annual General Meeting and Notice u/s 257 of the Companies Act, 1956 together with necessary deposit has been received from a member of the Company signifying his intention to propose Shri Himanshu Shahs appointment as Director.

Pursuant to the provisions of the Companies Act, 1956 and Articles of Association of the Company, Shri Nrupesh Shah, Director of the Company retires by rotation at the ensuing Annual General Meeting, and being eligible, offer himself for re-appointment. Your Directors recommend their re-appointment.

9] Fixed Deposit

Your company has made timely repayment of all deposits to investors and out standing deposit is Nil. 10] Segment-wise Performance

The company is engaged in the business of air coolers and water heaters, both of which are governed by the same set of risks and returns. In view of this, the entire business of the company comes under one primary segment, namely that of "Appliances". However, domestic sales and exports sales are two secondary geographical segments, and appropriate disclosures have been made in the Notes to the Accounts. 11] Consolidated Accounts

As required under Clause 32 of the Listing Agreement with the Stock Exchange, Audited Consolidated Financial Statements form part of the Annual Report. 12] Compliances of Accounting Standards

The Institute of Chartered Accountants of India (ICAI) has from time to time introduced many accounting standards for consistent application of accounting principles & transparent disclosures by corporate entities. Your company has opted for substantial compliance of all mandatory accounting standards, wherever applicable, except as stated by Auditors in their report, if any. 13] Directors Responsibility Statement

Pursuant to sub-section (2AA) of Section 217 of the Companies Act, 1956, the Board of Directors of the Company hereby state and confirm that: (i) In the preparation of the Annual Accounts, the applicable accounting standards issued by The Institute of Chartered Accountants of India and requirements of the Companies Act, 1956, have been followed; (ii) Such accounting policies have been selected and applied consistently, and such judgments and estimates have been made as are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company for the period ending on 30th June 2009 and of the profit of the Company for that period; (iii) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (iv) The annual accounts have been prepared on a going concern basis.

14] INSURANCE

All the insurable interests of the Company including Factory Building, Plant & Machinery, Stocks, vehicles, and other insurable interests are adequately insured. 15] Disclosure

In line with the requirements of Listing Agreement with the Stock Exchanges and the Accounting Standards of the Institute of Chartered Accountants of India, your Company has made additional disclosures in the Notes on Accounts for the year under review in respect of related party transaction, calculation of EPS and deferred tax liability.

16] Conservation of Energy Tech nology Absorption and Foreign Exchange Earnings and Outgo As required under Section 217(1 )(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in Report of Board of Directors) Rules, 1988, details relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo are given in the Annexure "A" attached hereto and forming part of the Directors Report.

17] Particulars of Employees

Pursuant to section 217(2A) of the Companies Act, 1956 and Rules made thereunder, a statement containing particulars of the Companys employees who were in receipt of the remuneration of not less than Rs. 24,00,000/- during the year ended 30* June 2009 or not less than Rs. 2,00,000/- per month during any part of the said year is given in the Annexure 11 to this Report.

18] Auditors

M/s. Shah & Dalai, Chartered Accountants, Ahmedabad, hold office as Auditors of the Company until the conclusion of the ensuing 22nd Annual General Meeting and the Board recommends their re-appointment till the conclusion of the next Annual General Meeting.

The Company has received a certificate from Auditors under Section 224(1) of the Companies Act, 1956 to the effect that their re-appointment, if made, would be within the prescribed limits under Section 224(1 B) of the Act.

Members are requested to consider their re- appointment as Auditors of the Company for the current year at a remuneration to be decided by the Board of Directors.

19] ACKNOWLEDGEMENTS

The Directors express their grateful thanks to the distributors, dealers, suppliers, C&FAs, vendors, and other parties dealing with the company for their support & co-operation and look forward to their continued association with the company. The Directors also record their appreciation of the devoted services rendered by all levels of the Companys personnel during the year. The Company will make every effort to meet the aspirations of its Shareholders and wish to thank them sincerely for their whole hearted co-operation and support at all times.

For and on behalf of the Board

Place : Ahmedabad ACHAL A. BAKERI

Date : 31/10/2009. Chairman & Managing Director

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