DIRECTORS' REPORT

Dear Members,

The Directors are pleased to present herewith the twenty-ninth Annual Report together with the audited statement of accounts of your Company for the year ended 31st March, 2015.

In order to meet the growing funding requirements of the Company it has been decided to retain profits of the business in the Company, as such your directors have not recommended any dividend for the year under report.

WORKING

The production improved during the year by 9% and was higher at 4362 M.T. as against 4014 M.T. last year. The turnover was higher by 12.32% at Rs. 7339.10 lacs as against Rs. 6533.85 lacs. This is due to the rise in exports which constitute 54 % of total sales made during the year and exports are made on CIF basis sans duties and taxes. The company has also continued to manufacture nylon yarns under its agreement for processing speciality yarns. The processing charges increased by 21% from Rs 79 lacs last year to Rs. 95.31 lacs. The Company has modified some of its machinery and enhanced its capacity to facilitate manufacture of newer products. The export turnover was higher at Rs. 3958.52 lacs as against Rs. 3911.11 lacs last year.

The profits before taxation increased to Rs. 121.22 lacs as against Rs 105.97 lacs in the past year. The Company had upgraded many of its production facilities, improved capacity utilization and used better marketing strategies which improved the overall performance of the Company during the year. The management is working hard to improve the capacity utilization further. The draw warping and sizing activity remained on a low key as the margins remained under

pressure due to lack of demand in the segment in the domestic market. The prices remained volatile during the year due to the fluctuation in the crude oil prices. The Company is expecting to augment its capacity to balance its existing capacity and meet, domestic as well as the exports market requirement.

EXPORTS

The company continued exports of its products and it has exported about 54 % of the total sales during the year. The Company expects to explore other global markets owing to positive response from international customers. The products are well received by the market.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

No company has become/ceased to be a joint venture partner or associate of the Company during the financial year 2014-15.

EXTRACT OF ANNUAL RETURN

Extract of Annual Return of the Company is annexed herewith as Annexure I to this Report.

DIRECTORS

Mr. S. K. Mishra, Director of the Company retires by rotation and being eligible offers himself for reappointment at this Annual General Meeting. The Board of Directors has recommended his reappointment for consideration of the shareholders.

Mrs. Meeta Shingala was appointed as an Additional Director of the Company on 10th February, 2015 and holds office upto the date of the ensuing Annual General Meeting. Her appointment as an Independent Director is proposed for a term of 5 years. The Company has received a Notice as per the Provisions of the Section 160(1) of the Companies Act, 2013, from a member of the Company sponsoring her candidature as a Director of the Company. The Board of Directors recommends her appointment.

All independent directors have given declarations that they meet the criteria of independence as laid down under section 149(6) of the Companies Act, 2013 and clause 49 of the Listing Agreement.

KEY MANAGERIAL PERSON

During the year under review, the company has appointed Ms. Vaishali Naik as Company Secretary of the company.

BOARD EVALUATION

In compliance with the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the performance evaluation of the Board was carried out during the year under review. The Board of Directors expressed their satisfaction with the evaluation process.

MEETINGS

During the year four Board Meetings, four Audit Committee Meetings, One Stakeholders Relationship Committee Meeting, One Nomination and Remuneration Committee Meeting and One Independent Directors Meeting were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013.

VIGIL MECHANISM/ WHISTLE BLOWER POLICY

Pursuant to Section 177 of the Companies Act, 2013 and Clause 49 of the Listing Agreement with the Stock Exchanges the company has established a vigil mechanism which may be called "Whistle Blower Policy" for employees and Directors to report to the management instances of unethical behaviour, actual or suspected fraud or violation of the Company's code of conduct. More details on the same are given in the Corporate Governance Report.

REMUNERATION POLICY

The company follows a policy on remuneration of Directors and Senior Management employees. The Policy is approved by the Nomination & Remuneration Committee and the Board. The Remuneration Policy is stated in the Corporate Governance Report.

FIXED DEPOSITS

The outstanding amount of Deposits with your Company was Nil. During the year your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm's length basis. During the year, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the related party transactions policy of the company.

The Policy on dealing with related party transactions as approved by the Board may be accessed on the Company's website. Your Directors draw attention of the members to Note 29 to the financial statement which sets out related party disclosures.

RISK MANAGEMENT

Business risk evaluation and management is an ongoing process within the company. The assessment is periodically examined by the Board.

CORPORATE GOVERNANCE

Your Company attaches considerable significance to compliance with the conditions of Corporate Governance under Clause 49 of the Listing Agreement with the Stock Exchange. A Report on Corporate Governance is hereto annexed.

INTERNAL FINANCIAL CONTROL

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed.

AUDITORS

The auditors M/s. M.B. Agrawal & Co., and M/s. N.G. Thakrar & Co., retire at the conclusion of the ensuing Annual General Meeting. They have furnished certificates of their eligibility for re-appointment.

SECRETARIAL AUDITOR AND SECRETARIAL AUDIT REPORT

The Board has appointed M/s Vikas R. Chomal & Associates, Practicing Company Secretary, Mumbai to carry out Secretarial Audit under the provisions of Section 204 of the Companies Act, 2013 for the financial year 2014-15. The report of the Secretarial Auditor is annexed to this report as Annexure - II.

DIRECTORS' RESPONSIBILITY STATEMENT

In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that:

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

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

(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

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

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

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

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The Particulars with respect to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Companies Act, 2013, read with Rule 8(3) of the Companies (Accounts) Rules, 2014 and forming part of the Directors' Report for the year ended 31st March, 2015 are annexed to this report.

MANAGEMENT DISCUSSION & ANALYSIS REPORT

As required under the Listing Agreement, Management Discussion & Analysis Report is attached and forms a part of this Report.

ACKNOWLEDGEMENT

The Directors wish to place on record their appreciation of the contribution made by the executives, officers and workmen of the Company during the year. The Board also acknowledges with thanks the support, co-operation and assistance given by the Bank.

For and on behalf of the Board,

S. S. Mishra

Chairman

Mumbai, 30th May, 2015