DIRECTORS' REPORT

To,

The Members,

Your Directors hereby present the 41st Annual Report and Audited Accounts of the Company for the Financial Year ended on March 31, 2015.

2. STATE OF COMPANY AFFAIRS AND FUTURE OUTLOOK

In the current financial year, the company continues to focus on growth of its branded business and is confident that the consumer business will grow by more than 100%, which is an achievement in itself. The company has a fast growing distribution network and intends to leverage that by launching new products and brands, whilst focusing on growth for the existing brands. The flagship brand where the company is seeing a growing leadership position is:

Oleev - olive oils and healthy oils

Other than that we have developed the following value added products:

Rizolo India's Finest - Rice Bran Oil

Miller - Canola Oil with low absorption technology

Olivana Wellness - massage oils.

Whilst Rizolo and Miller have a direct fit in the edible oil stable, Olivana Wellness is the company's foray into the personal care segment of FMCG. The move is to further strengthen the distribution base and unlock the opportunity to enter higher margin product categories.

The company, on the back of the success of its flagship brands, is sitting on a mountain of opportunities within the distribution and FMCG business. The management is confident that with its strategies in place, the company will be able to harness the growth potential that lies ahead of us.

3.CHANGE IN NATURE OF BUSINEES

There was no change in the nature of business of your company during the year.

4.DIVIDEND

No Dividend was declared for the current financial year.

5.TRANSFER TO RESERVES

Your Company has not transferred any amount of profits to reserves.

6.CHANGE IN SHARE CAPITAL

Your Company has neither issued any equity shares with differential rights nor granted any employees stock options/ sweat equity shares to the Directors, Officers or employees of the company during the year.

7.DEPOSITS FROM PUBLIC

During the year, your Company has not accepted any deposits within the meaning of Sections 73 and 74 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

8.EXTRACT OF ANNUAL RETURN

In accordance with Sections 134(3) (a) and 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as "Annexure-1".

9.NUMBER OF BOARD MEETINGS

During the financial year ended March 31, 2015, the Company had seven (7) Board meetings on May 30, 2014, July 8, 2014, August 11, 2014, November 14, 2014, February 11, 2015, February 24, 2015 and March 31, 2015 respectively.

10.PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS:

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

11.PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All related party transactions that were entered into during the year were on arm's length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the Company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the Company at large. Disclosure as required under form AOC - 2 are Contained in Note No. 34 (Notes to accounts)

12.AUDITORS' STATUTORY AUDITORS'

Pursuant to the provisions of Section 139 of the Act and the rules framed there under, Messrs K. K. Jain & Co., Chartered Accountants, were appointed as statutory auditors of the Company from the conclusion of the 40th annual general meeting (AGM) of the Company held on August 19, 2014 till the conclusion of the 43rd Annual General Meeting, subject to ratification of their appointment at every Annual General Meeting. In terms of the first proviso to Section 139 of the Companies Act, 2013, the appointment of the auditors shall be placed for ratification at every Annual General Meeting. Accordingly, the appointment of Messrs K. K. Jain & Co, Chartered Accountants, as statutory auditors of the Company, is placed for ratification by the shareholders at the 41st Annual General Meeting of the Company. In this regard, the Company has received a certificate from the auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.

SECRETARIAL AUDITORS'

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s RMD & Associates, Company Secretaries to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as "Annexure 2".

COST AUDITORS'

Based on the Audit Committee recommendations at its meeting held on May 30, 2015 and subject to approval by Central Government, the Board recommends the appointment of M/s. Manisha Taiyal & Associates as the Cost Auditors of the Company for the year ended on March 2015 -16. The report for the financial year 2013-14 has been filed on 26th September, 2014.

13.EXPLANATION TO AUDITOR'S REMARKS

There are no qualifications made by the Auditors in their Report which requires any explanation from the Board of Directors of the Company. The Notes to Accounts referred to in the Auditors' Report are self-explanatory and do not call for any further comments.

14.MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material changes affecting the financial position of the Company.

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

The Particulars with regard to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings & Outgo are given below

A.CONSERVATION OF ENERGY

i)Steps taken or impact on conservation of energy:

ii)The steps taken by the company for utilizing alternate sources of energy

Your Company has taken adequate measures to ensure optimum use of all equipment's so as to conserve energy.

iii)Capital Investment on energy conservation equipments : Nil

B.TECHNOLOGY ABSORPTION

The company strives continuously to upgrade its technology adopted in all its operations.

C.FOREIGN EXCHANGE EARNINGS & OUTGO,

a)Earnings - Nil

b)Outgo - Rs 304500

16.DETAILS OF SUBSIDIARY, JOINT VENTURE OR ASSOCIATES

The Company does not have any Subsidiary/Joint Venture/Associate Company.

17.RISK MANAGEMENT

The Audit Committee has additional oversight in the area of financial risks and controls. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis.

18.DIRECTORS & KEY MANAGERIAL PERSONNEL (KMP)

At the meeting of the Board of Directors of the Company held on 31st March, 2015, Ms Aditi Gupta (DIN - 01786037) was appointed as an Additional Director of the Company. She holds the office of director up to the date of the ensuing Annual General Meeting. The Board recommends her appointment as Director at the ensuing Annual General Meeting of the Company. Mr. Akshay Modi retires by rotation and being eligible has offered himself for re-appointment.

19.DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNAL

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

20.INTERNAL FINANCIAL CONTROLS

Your Company has a proper and adequate system of internal financial controls. This ensures that all assets are safeguarded and protected against loss from unauthorised use or disposition and the transactions are authorised, recorded and reported correctly. The internal financial control system has been designed to ensure that the financial and other records are reliable for preparing financial and other statements and for maintaining accountability of assets.

Audit Committee periodically reviews the performance of internal audit function and discusses internal audit reports with the Internal Auditor

21.FRAUD

Your company is a very well-managed company and neither the Auditors nor the Secretarial Auditors have brought to the notice of the Audit Committee or the Board of Directors or the Central Government the occurrence or brewing of any fraud in the Company.

22.CODE OF CONDUCT FOR REGULATING & REPORTING TRADING BY INSIDERS AND FOR FAIR DISCLOSURE, 2015

Your Company has adopted the "Code of Conduct for regulating & reporting trading by insiders and for fair disclosure, 2015" which, inter alia, prohibits purchase or sale of securities of the Company by Directors, employees and other connected persons while in possession of unpublished price sensitive information in relation to the Company.

23.DISCLOSURE OF RATIO OF REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL ETC.

As required under Section 197(12) read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the details of the ratio of the remuneration of each director to the median employee's remuneration and such other details as prescribed therein are given in "Annexure-3", which is attached hereto and forms a part of the Directors' Report.

24.PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, names and other particulars in respect of employees of the Company are required to be attached to the Directors' Report. In terms of Section 136 of the Act, the reports and accounts are being sent to the members and other entitled thereto, excluding the information on employees' particulars as there are no employees whose particulars are required to be disclosed in this report.

PERSONNEL

Your Company aims to be a preferred employer in the industry and remains committed to developing its employees to meet the current and future challenges of the business.

25.CODE OF CONDUCT

The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and Senior Management Personnel in the course of day to day business operations of the Company. The Code has been posted on the Company's website www.modinaturals.com.

26.AUDIT COMMITTEE

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

27.CORPORATE GOVERNANCE

Your Company has complied with the requirements and disclosures that have to be made under the Code of Corporate Governance as required under Clause 49 of the Listing Agreement entered into with the BSE Limited (BSE) (the "Stock Exchange"). As a listed company, necessary measures are taken to comply with the Listing Agreement with the Stock Exchange. A report on Corporate Governance, along with a certificate of compliance from the Statutory Auditors, forms part of this Annual Report. The Chairman & Managing Directors' declaration regarding compliance with 'Modi Naturals Limited Code of Conduct for Board Members and Senior Management' is attached to the Corporate Governance Report.

28.CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY

The provisions of the Companies Act, 2013 relating to Corporate Social Responsibility are not applicable on the Company.

29.FORMAL EVALUATION OF BOARD, COMMITTEES & DIRECTORS' PERFORMANCE

Pursuant to the provisions of the Companies Act, 2013 the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and other Committees. The manner in which the evaluation has been carried out has been explained hereunder.

A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board's functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance.

In a separate meeting of independent Directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was reviewed, taking into account the views of executive directors and nonexecutive directors of the company.

30.REMUNERATION POLICY

The Nomination and Remuneration Committee recommend the appointment of Director, and there appointment or reappointment, based on their qualifications, professional experience, positive attributes, view points, skills and area of expertise and independence.

31.WHISTLE BLOWER/VIGILANCE POLICY

Your Company has established a whistle blower policy/vigil mechanism for the Directors, employees of the company, to report genuine concerns, calling the attention of the Audit Committee to some wrongdoing occurring within an organization. Your Company has also provided adequate safeguards against victimization of whistleblowers who express their concerns against such wrongdoings occurring in the organization. The Company has also provided direct access to the chairman of the Audit Committee, in exceptional circumstances.

32.DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE, (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

Your company did not come across any complaints by any employees during the year under review relating to the sexual harassmen t.

33.DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the board of directors, to the best of their knowledge and ability,

I.in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

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

III.the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

IV.the directors had prepared the annual accounts on a going concern basis;

V the directors had laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively;

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

34. ACKNOWLEDGEMENTS

The Board of Directors take this opportunity to thank all its Shareholders, valued customers, banks, Government and Statutory Authorities, Investors and the Stock Exchange for their continued support to the Company. Your Directors also wish to place on record their deep sense of appreciation for the committed services by your Company's employees. Your Directors acknowledge with gratitude the encouragement and support extended by our valued Shareholders and the Promoters of the Company.confirm that:

On behalf of the Board of Directors

sd/-(Anil Modi)

Chairman & Managing Director

Date : 30th May, 2015

Place : New Delhi