Dear Members,

The Board of Directors (hereinafter referred to as "the Board") hereby submits the report of the business and operations of the Company along with the Audited Financial Statements of the Company for the Financial Year (FY) ended March 31, 2021. The consolidated performance of the Company and its subsidiary has been referred to wherever required.

Financial Results and Highlights of Performance

The Company's performance, as per Indian Accounting Standards (IND AS), during the Financial Year under review is summarized as follows:

(' In Lakhs)

Note : The above figures are extracted from Standalone and Consolidated Financial Statements as per Indian Accounting Standard ("IND AS") and are prepared in accordance with the principles stated therein as prescribed by the Ministry of Corporate Affairs under section 133 of the Companies Act, 2013 ("Act") read with relevant rules issued therein.

General Performance and Outlook

The onset of the COVID-19 pandemic brought economic activities to a near standstill at the beginning of FY 2020-21 as a nationwide lockdown was imposed to contain the virus spread. As a result, India's GDP contracted by 23.4% in Q1 FY 202021. However, with the gradual unlocking in June 2020, the economy recorded a sharp rebound, fuelled by the synchronised relief and revival measures undertaken by the Central Government and the RBI.

The more intense second wave of COVID-19 hit India hard at the end of FY 2020-21, necessitating the imposition of new localised lockdowns. That said, with mass vaccination underway in full steam and the element of surprise being minimal, we believe the economy is now much better placed to absorb external shocks than it was a year earlier.

The COVID 19-induced lockdown adversely affected the demand for textile products across markets. India was no different. As the lockdown was gradually relaxed, labour availability increased in the key textile hubs of the country, with demand being boosted by a steady increase in consumer spending. The value of exports of Indian textile products also recovered to near pre-COVID levels in Q3 FY 2020-21.

The Indian Textile Industry comprises spinning, weaving and knitting, fabric finishing and apparel segments. It continues to be India's second-largest employment generating sector. The Indian textile and apparel market fell by 30% from USD 106 billion in 2019-20 to USD 75 billion in 2020-21. This was attributed to the economic impacts and trade restrictions due to the Covid-19 pandemic. India's textiles industry contributed around 7% to the industry output (by value) in 2019-20. The Indian textiles and apparel industry contributed 2% to GDP, 12% to export earnings, and maintained a share of 5% of global textiles and apparel trade in 2019-20.

Textile & Apparel sector is a major contributor to India's total export earnings. Currently, it contributes to 11% of total export earnings of US$ 276 billion. The share of the sector in exports has declined from 14% in 2015 to 11% in 2020.

In terms of yarn manufacturing capabilities, India has production facilities for both natural and man-made yarn. India has an installed capacity of 53 million spindles, producing approximately 5,713 million kg yarn in 2019-20. India is one of the largest producers and exporter of cotton yarn in the world with a production of 3,996 million kgs of 100% Cotton Spun Yarn in 2019-20. India's export of cotton yarn stood at US$ 2.2 billion in 2020-21 (Apr to Jan). Due to the ongoing trade tensions with China, demand for Indian cotton textile increased internationally, despite the pandemic. The cotton yarn exports registered a significant jump in YoY growth from -40% in Q1FY21 to 15% in Q2FY21.

India reported a GDP de-growth of (-) 24.4% in the first quarter compared to 5.4% growth for the same quarter, previous year. However, with easing of the restrictions, the economy started recovering slowly and GDP Growth improved to negative (-) 7.3% during the second quarter followed by 0.4% in third quarter. Quarter four of fiscal year 2020-21 witnessed encouraging growth in economic activities as the rapid spread of the COVID-19 pandemic subsided, and both business activities and consumption started reviving to pre-pandemic levels. The growth in GDP during 2020-21 is estimated at negative (-) 8% as compared to 4% in 2019-20 as per second advance estimates released by the Central Government.

The Indian economy is estimated to decline by 8% in FY 2020-21. India's economic decline was sharper than other key economies due to strict and early lockdowns to control the spread of COVID-19. However, growth has continued to recover and was back in positive territory (+0.4%) in Q3 FY 2021 after a decline of 24.4% and 7.3% respectively in Q1 FY 2021 and Q2 FY 2021. India saw recovery as most consumption and industrial indicators were back in positive growth territory in the September-December 2020 quarter after being in negative in the June 2020 quarter. Among other industrial indicators GST collections have remained robust at above Rs 1 trillion mark.

The global apparel consumption in 2020 was estimated to be US$ 1.2 trillion, declining by 22% from 2019, due to the pandemic. European Union was the largest apparel consumer market followed by USA, China, and Japan. They together contributing 50% of the global apparel market consumption. The global apparel demand is expected to grow at a CAGR of 3.5% to reach US$ 2 trillion by 2025. China and India are expected to be the fastest growing apparel markets both growing in double digits, with China and India valued at US$ 340 and Us$ 135 billion respectively by 2025.

The global trade of cotton yarn was valued at US$ 14.3 billion in 2019, it has declined at a CAGR of 1% since 2015. In 2020, cotton produced in XUAR region of China, which supplies 70% of the world's cotton demand, was banned in the US for using forced labor resulting in shift of fibre and yarn sourcing to India and Vietnam causing significant increase in demand of cotton and yarn prices.

Mills Division -

The company was under lockdown due to Covid-19 from March 24, 2020 to May 03, 2020 and opened for operations on May 04, 2020. As a result of this situation sales, profitability and liquidity were impacted negatively in 1st quarter of financial year 2020 - 2021. However situation started improving from 2nd quarter of financial year 2020 - 2021 with better market demand from all over India and demand in export for Garments. Company also ventured into production and sales of Medical Textiles viz. Cotton face masks and PPE kits. Good Monsoon also added to good power generation by subsidiary Company's Hydro power unit during the year.

The company is in the manufacturing business mainly for cotton grey and dyed yarn for domestic and international market. However since domestic market picked up better since 2nd quarter of financial year 2020 - 2021, the Company focused on the business of yarn sales in domestic market only. This time to further improve the performance of the Company focus was mainly on change in product mix with value addition of change of count pattern, Linen with cotton and viscose blends, 100% Bamboo to prepare good quality Bath Towels, Napkins, Shawls etc.

This year the Company has entered into E-Commerce business of Online Garments sales and it is getting good response for various knitted, woven garments and home Textile products through our web site https://online.gokaktextiles.com

Knitwear Division -

Apart from catering for Polo T-shirts for brand Crocodile brand, this year the Knitwear division of the Company focused on manufacturing and sales of Cotton face masks and PPE Coveralls and received good demand locally in the beginning of financial year 2020 - 2021 due to Covid.

Risks and Concerns:

Risk management process includes identification of risks, its underlying dynamics, mitigation mechanism, prioritization of risk, measurement of key indicators and establishing a monitoring system. A Company-wide awareness of risk management policies and practices are being inculcated to minimize the adverse effect of risks on the operating results and the subject of management of risks is being approached in a planned and coordinated manner. Elucidation of role clarity, understanding of level of authority and reporting system is expected to help this process significantly.

The Company has identified key risks such as Market risks, Regulatory risks, Human resource risks, Commodity price risks. Key Risks include fluctuation in raw materials prices, increased global and local competition, sales channel disruption. Retaining the existing talent pool and attracting new talent. Regulatory Risks include changes in taxation regime, government policies with respect to textiles, pollution control, Industrial Relation issues & regulatory compliances.

Covid -19 Pandemic

The increasing trend in the infection, locally and globally, new strains of Covid-19, restrictions and lockdown imposed by local authorities of varying extent, have led to uncertainty and disrupted operations of many large and small businesses. There is a significant change in the demand/supply of products, priorities of consumers, budgets/growth plans of companies. Covid-19 pandemic has amplified existing risks. The Company was not immune to the same. To mitigate the risks the Company took lot of precautions & strict factory management such as shop floor sanitization after every shift, keeping track of each employee's well-being, and strictly following Covid-19 protocol, adopting digital tools to engage with existing & prospective customers etc. All these efforts immensely helped us to mitigate the pandemic risk and establish connections with customer & business growth.

Gokak Power & Energy Limited (GPEL)

GPEL is engaged in generation, transmission, distribution, trading of hydro power and other renewal and non-renewal sources of energy. The significant portion of power generation is used for captive consumption of Holding Company.

During the year under review, your Company has recorded gross income of Rs 1,122.63 lakhs (previous year Rs 874.32 lakhs) and net loss for the year of Rs (370.14) lakhs (previous year Rs (550.34). During the year 2019-20, entire powerhouse of 8.0 MW situated in Gokak Falls was submerged due to an unprecedented flood on August 7, 2019. Out of 8 MW, 7 MW sets have been repaired and restored for power generation, remaining 1 MW old hydro power plant which was heavily damaged and required major repairs, has been repaired, tested in June 2021. Once the water is available in monsoon the load trail will be taken and after successful completion of the load trial the set will be available for commercial generation of power. Details of GPEL is set out in the statement in form AOC-I, pursuant to section 129 of the Companies Act, 2013 and is attached herewith as Annexure I to this Report.

Financial Performance

The Consolidated Financial Statements of the Company and its subsidiary are prepared in accordance with Indian Accounting Standards (IND AS) notified under Section 133 of the Companies Act, 2013 read with Companies (Indian Accounting Standards) Rules, 2015 as amended from time to time and other relevant provisions of the Companies Act, 2013. The Notes to Consolidated Financial Statements are disclosed and forms part of the Consolidated Financial Statements.

Key Financial performance, Operational Information and Ratio Analysis

Revenue

During the year, standalone revenue was Rs 10,907.35 Lakhs (previous year '10,216.41 Lakhs), which is almost comparable. Consolidated revenue was Rs 11,325.99 Lakhs (previous year Rs 10,742.55 Lakhs), which is almost comparable.

During the year, standalone EBIDTA (loss) decreased to Rs (1745.32) Lakhs (previous year Rs (2696.38) Lakhs). Consolidated EBIDTA (loss) decreased to Rs (966.52) Lakhs (previous year Rs (2,056.73) Lakhs).

Profit Before Tax ("PBT")

During the year, standalone PBT (loss) increased to Rs (3,687.23) Lakhs (previous year Rs (4,458.80) Lakhs). Consolidated PBT (loss) increased to Rs (3,802.17) Lakhs (previous year Rs (4,758.66) Lakhs).

Profit/(Loss)

During the year, standalone loss decreased to Rs (3,712.07) Lakhs (previous year Rs (4,477.52) Lakhs). Consolidated loss increased to Rs (3,831.49) Lakhs (previous year Rs (4,777.45) Lakhs).

Fixed Assets

The standalone year-end Gross Block decreased to Rs 31,243.57 Lakhs (previous year Rs 32,590.00 Lakhs) mainly due to sale of plant & machinery, building and vehicles. The consolidated year-end Gross Block decreased to Rs 44,046.05 Lakhs (previous year Rs 45,392.49 Lakhs) mainly due to sale of plant & machinery, building and vehicles.

Current Liabilities

The standalone current liabilities increased to Rs 4,235.41 Lakhs (previous year Rs 3,561.37 Lakhs) primarily due to increase in "trade payables". The consolidated current liabilities increased to Rs 11,763.09 Lakhs (previous year Rs 10,411.71 Lakhs) primarily due to increase in "trade payables" and interest on borrowings from parent company.

Loan Funds (Secured)

During the year, standalone loan funds was NIL (previous year NIL). The consolidated loan funds decreased to Rs 2,556.86 Lakhs (previous year Rs 3,182.75 Lakhs) primarily due to payment of principal amount instalments due during the year.

Loan Funds (Unsecured)

During the year, standalone loan funds increased to Rs 10,627.91 (previous year Rs 9,271.55 Lakhs) primarily on account of increase in long term borrowings from parent company. The consolidated loan funds increased to Rs 16,717.43 Lakhs (previous year Rs 14,887.80 Lakhs) primarily on account of increase in long term borrowings from parent company

Share Capital and Preference Shares

The paid-up Equity Share Capital of the Company as on March 31, 2021 was Rs 18,149.93 Lakhs. During the year under review, the Company has not issued any shares with differential voting rights or 'sweat equity shares' and has not granted any stock options. As on March 31, 2021 none of the Directors of the Company hold shares or convertible instruments of the Company.

Dividend and Transfer to Reserves

In view of the losses during the current year, the Board of Directors regrets their inability to declare dividend. No amount was transferred to the reserves during the year.

Material changes and commitments

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

Legal and Regulatory

Compliance with laws and regulations is an essential part of your Company's business operations. We are subject to laws and regulations in diverse areas as product safety, product claims, trademarks, copyright, patents, competition, employee health and safety, the environment, corporate governance, listing and disclosure, employment and taxes. Frequent changes in legal and regulatory regime and introduction of newer regulations with multiple authorities regulating same areas lead to complexity in compliance. We closely monitor and review our practices to ensure that we remain complaint with relevant laws and legal obligations.

Systems and Information

Your Company's operations are increasingly dependent on IT systems and the management of information. Increasing digital interactions with customers, suppliers and consumers place even greater emphasis on the need for secure and reliable IT systems and infrastructure, and careful management of the information that is in our possession.

The cyber-attack threat of unauthorised access and misuse of sensitive information or disruption to operations continues to increase. To reduce the impact of external cyber-attacks impacting our business, we have sufficient security measures including firewalls and threat monitoring systems in place, complete with immediate response capabilities to mitigate identified threats. Our employees are trained to understand these requirements.

Internal Control Systems and their adequacy:

The Company has an Internal Control systems, which ensures that all transactions are satisfactorily recorded and reported and all assets are protected against loss from an unauthorized use or otherwise. The internal control systems are supplemented by an internal audit system carried out by independent firms of Chartered Accountants and a periodical review by the management. The findings of such Internal Audits are addressed through suitable corrective measures. The Audit Committee of the Board meets at a regular interval and advises on significant issues raised by, both, the Internal Auditors and the Statutory Auditors. The process of internal control, systems, statutory compliance, risk analysis, information technology and its management are woven together to provide a meaningful support to the management of the business.

Batliboi & Purohit, Chartered Accountants, the statutory auditors of the Company have audited the financial statements included in this annual report and have issued report, inter alia, on the internal financial controls over financial reporting as defined under section 143 of the Companies Act, 2013.

Deposits

During the year under review, the Company has not accepted any deposits from public falling within the meaning of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.

Particulars of loans, guarantees or investments

Particulars of Loans, Guarantees or Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

Directors and Key Managerial Personnel

As per the provisions of Section 152(6) of the Companies Act, 2013, Ms. Tripti J. Navani is due to retire by rotation at the ensuing Annual General Meeting and being eligible, seeks re-appointment. The Board of Directors recommends her reappointment as Director of the Company.

Mr. Vinod Bhandawat has been appointed as an Additional Director of the Company with effect from January 15, 2021. In the Notice of ensuing Annual General Meeting of the Company an item for appointment of Mr. Vinod Bhandawat as Non - Independent Non - Executive Director of the Company has been included.

Mr. Vasant N. Sanzgiri, Non - Independent Non - Executive Director of the Company resigned from the Board of Director of the Company with effect from November 27, 2020. The Board places on record their sincere appreciation for the valuable services rendered by them to the Board and the Company over the period of their association with the Company.

Mr. Avadhut Sarnaik, Chief Financial Officer of the Company passed away on May 01, 2021. The Board places on record the valuable contributions of Mr. Avadhut Sarnaik to the Company and expressed its deep condolences on the sudden and untimely sad demise of Mr. Avadhut Sarnaik.

Mr. Vipan Kumar Sharma has been appointed as Chief Financial Officer of the Company with effect from June 28, 2021.

Key Managerial Personnel of the Company as on March 31, 2021 were Mr. Ramesh R Patil, Chief Executive Officer & Managing Director, Mr. Rakesh M. Nanwani, Company Secretary and Mr. Avadhut Sarnaik, Chief Financial Officer.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of Independence as prescribed both under the Companies Act, 2013 and Securities and Exchange Board of India

(Listing Obligations and Disclosure Requirements), 2015 and there has been no change in the circumstances which may affect their status as Independent Directors during the year.

During the year under review, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees for attending meetings of Board/ Committee of the Company.

Independent Directors are familiarized with their roles, rights and responsibilities in the Company through presentation made to them from time to time. The details of familiarization programmes conducted have been hosted on the website of the Company and can be accessed at www.gokakmills.com

Audit Committee of the Board of Directors

The details pertaining to the composition of the Audit Committee of the Board of Directors are included in the Corporate Governance Report which forms part of this report.

Meetings of the Board

The Board met at least once in each quarter and 4 (four) meetings of Board were held during the year and the maximum time gap between two Board meetings did not exceed the time limit prescribed under the Companies Act, 2013. The details have been provided in the Corporate Governance Report.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and SEBI (LODR), 2015, the Board has carried out an annual performance evaluation of its own performance, the directors individually, as well as, the evaluation of the working of its Audit, Nomination and Remuneration, Stakeholders' Relationship Committees.

The performance of the Board was evaluated by the Board on the basis of the process laid in the Charter for Performance Evaluation, the structured questionnaires for performance evaluation, parameters/criteria, such as, degree of fulfillment of key responsibility by the Board, Board Structures and Composition, establishment and delineation of responsibilities to the Committees, effectiveness of Board processes, information and functioning, Board culture and dynamics and quality of relationship between the Board and the Management.

The performance of the committees viz. Audit Committee, Nomination and Remuneration Committee, Corporate Social Responsibility and Stakeholders Relationship Committee was evaluated by the Board on the basis of parameters/criteria such as degree of fulfillment of key responsibilities, adequacy of committee composition, effectiveness of meetings, committee dynamics and, quality of relationship of the committee with the Board and the Management.

The Board and the Nomination and Remuneration Committee reviewed the performance of the individual Directors (without the concerned director being present).

In a separate meeting of Independent Directors, the performance of Non-Independent Directors of the Board as a whole and the performance of the Chairman were evaluated.

Remuneration Policy

The Board has, on the recommendation of the Nomination & Remuneration Committee, framed and adopted a policy for selection and appointment of Director, Senior Management and their remuneration. Remuneration Policy of the Company acts as a guideline for determining, inter alia, qualifications, positive attributes and independence of a Director, matters relating to the remuneration, appointment, removal, and evaluation of the performance of the Directors, Key Managerial Personnel and Senior Managerial personnel.

Nomination & Remuneration Policy is annexed as Annexure II to this Report.

Disclosure as required under section 197(12) of the Companies Act, 2013 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed as Annexure III to this Report.

Auditors and Audit Report Statutory Auditors

Pursuant to the provisions of section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, Batliboi & Purohit, Chartered Accountants (ICAI Firm Registration no. 101048W) were appointed as the Statutory Auditors of the Company for a term of 5 (five) years to hold office from the conclusion of the 11th Annual General Meeting of the Company till the conclusion of the 16th Annual General Meeting of the Company.

The Audit Report of the Statutory Auditors forms part of the Annual Report. The Auditors' Report does not contain any qualification. Notes to Accounts and Auditors remarks in their report are self-explanatory.

Cost Auditors

As per the requirements of section 148 of the Companies Act, 2013, read with The Companies (Cost Records and Audit) Rules, 2014, the cost accounts of the Company are required to be audited by a Cost Accountant. The Board of Directors of the Company on the recommendation of the Audit Committee, appointed Mr. Mukesh R. Dekhtawala, Cost Accountant as Cost Auditor for the financial year 2021 - 2022 on a remuneration of Rs 1.50 lakhs plus out of pocket expenses. As required under the Companies Act, 2013 necessary resolution seeking Shareholders ratification for the remuneration to Cost Auditor is included in the Notice convening the 15th Annual General Meeting of the Company.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed KDSH & Associates LLP, Company Secretaries, to conduct Secretarial Audit of the Company. The Report of the Secretarial Auditor is annexed herewith as Annexure IV to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark or disclaimer.

The Secretarial Audit of Gokak Power & Energy Limited, (Material Subsidiary) for the FY 2020-21 was carried out pursuant to Section 204 of the Companies Act, 2013 and Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015. The Report of the Secretarial Auditor of Gokak Power & Energy Limited does not contain any qualification, reservation or adverse remark or disclaimer.

Corporate Social Responsibility

The provisions of the Companies Act, 2013 relating to Corporate Social Responsibility were not applicable to the Company for the FY 2020-21. The Board of Directors of the Company has, however, voluntarily constituted a Corporate Social Responsibility Committee in compliance with Section 135 of the Act.

The Company is committed to its stakeholders to conduct business in an economically, socially and environmentally sustainable manner that is transparent and ethical.

Vigil Mechanism / Whistle Blower Policy

The Company has Whistle Blower Policy/Vigil Mechanism to deal with instances of fraud and mismanagement, if any. The policy is also available on the website of the Company.

Annual Return

Pursuant to Section 92(3) read with Section 134 (3)(a) of the Companies Act, 2013, the Annual Return as on March 31, 2021 is available on website of the Company viz., www.gokakmills.com

Related Party Transactions

All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of business. There were no materially significant related party transactions made by the Company with the Promoter, Directors, Key Managerial Personnel or the designated persons which may have a potential conflict with the interest of Company at large except power purchase from the subsidiary company for captive consumption and sale.

All related party transactions are placed before the Audit Committee for approval. Prior omnibus approval of the Audit Committee is obtained for transactions which are of a foreseen and repetitive nature. The transactions entered pursuant to the omnibus approval so granted are placed before the Audit Committee on a quarterly basis.

Form AOC-2 is annexed as Annexure V to this report, pursuant to section 188 of the Companies Act, 2013. The policy on Related Party Transactions as approved by the Board is uploaded on the Company's website.

Corporate Governance and Management Discussion and Analysis

The guiding principle of the Code of Corporate Governance is 'harmony' i.e balancing the need for transparency with need to protect the interest of the Company, balancing the need for empowerment at all levels with the need for accountability. A detailed report on Corporate Governance is annexed as a part of this Annual Report and the Management Discussion and Analysis report forms part of this report.

A Certificate on compliance of conditions of Corporate Governance issued by Mr. Kiran B. Desai, Designated Partner, KDSH & Associates LLP, Company Secretaries is annexed to the Report on Corporate Governance.

A certificate from a company secretary in practice that none of the directors on the board of the company have been debarred or disqualified from being appointed or continuing as directors of companies by the Board/Ministry of Corporate Affairs or any such statutory authority is annexed to the Report on Corporate Governance.

Significant and Material Orders passed by the Regulators or Courts

There are no significant and material orders passed by the Regulators / Courts which would impact the going concern status and Company's operations in future.

Statutory Compliances

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace as per with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. Internal Complaints & Committee (ICC) has been setup to redress complaints received regarding sexual harassment as per Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the ICC includes external member. During FY 2020-21, no complaints on sexual harassment were received.

Directors' Responsibility Statement

Pursuant to the provisions of Section 134(3)(c) and 134 (5) of the Companies Act, 2013 and based on the representations received from the operating management, the Directors hereby confirm that :-

a. in the preparation of the annual accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departures;

b. 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 or loss of the Company for that period;

c. they have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 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; and

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.

Developments in Human Resources / Industrial Relations front:

The Company has developed a strong human resource base which helped the company to retain the employees for a very long time in view of learning opportunity , comfortable housing, very good educational facilities at minimum educational fees for the children of the Employees.

The organization also has good HR Policies for employees in place. Recently management has initiated one policy viz. Staff Compensation Death Fund Policy with main objective to ensure and provide financial assistance to legal heir of deceased Supervisory & Managerial Staff.

In view of least attrition of the employees Management is encouraging employees to undertake higher responsibilities in the ladder of hierarchy so that the fresh talent hiring at the bottom of the organizational pyramid provides continuity of development at each level. The hiring of experienced employees from outside is the last priority and first opportunity is provided to employees in line function or cross function as well.

The company has different HR processes for development of human resource which includes performance management system for appraisal of employee performance, skill development and believes in the fundamentals of Train, Retrain & Retain employees by way giving three R, Rewards, Recognition & Respect to employees.

The Management has developed very good cordial Industrial relations and has been able to carry out operations successfully despite continued challenges of market down turn, fierce competition having high input cost by achieving flexibility in operations suitable to the requirements of business.

Particulars of Employees and Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo

a. The information required pursuant to Section 197 of the Act read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the Report and Accounts are being sent to the Members, excluding the information on employees' particulars which is available for inspection by the Members at the Registered Office of the Company during the business hours on working days of the Company. Any member interested in obtaining such particulars may write to the Company Secretary at the Registered Office of the Company.

b. Information relating to the Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo stipulated under Section 134(3)(m) of the Act read with Rule 8 of The Companies (Accounts) Rules, 2014 is annexed herewith as Annexure VI to this report.

Cautionary Statement:

Statements in the Board's Report and Management Discussion & Analysis describing the Company's objectives, estimates, expectations or projections, outlook etc., may be 'forward looking statements' within the meaning of the applicable securities

laws and regulations. Actual results may differ materially from those expressed or implied due to factors beyond control. Important factors that could make a difference to the Company's operations include economic conditions affecting demand/ supply and price conditions in the domestic and overseas markets in which the Company operates, changes in the government regulations, tax laws and other statutes and other factors such as litigation and industrial relations.

Acknowledgements

Your Directors acknowledge and thank all stakeholders of the Company viz. customers, members, employees, dealers, vendors, banks and other business partners for their valuable sustained support and encouragement. Your Directors look forward to receiving similar support and encouragement from all stakeholders in the years ahead.

For and on behalf of the Board of Directors