DIRECTORS REPORT

To

The Members,

The Directors have great pleasure in presenting the 26th Annual Report on the operations of the Company together with the audited Financial Results of the Company for the financial year ended 31st March, 2015.

FINANCIAL RESULTS OF COMPANY[i]

Rs. In Lacs

FINANCIAL RESULTS OF SUBSIDIARY COMPANY

Rs. In Lacs

OPERATIONS

The sales in the year under review have decreased by Rs. 5751.81 Lacs from Rs. 11705.80 Lacs to Rs. 5953.39 Lacs. This is an decrease of 49.14% (Approx) in current year compared to the last year.  During the year the Rupee weakened against the dollar and consequently there was an Exchanges Fluctuation Loss of Rs. 141.75 Lacs in the current year.

There was a fire at the plant on the intervening night between 9th & 10th January, 2015 in which the company lost its stocks and part of the Building and Plant & Machinery. The company has incurred a loss of Rs 22.25 crores due to the fire which have been reflected in Other Expenses. Due to this mis-happening, a major chunk of finish goods was destroyed which resulted in the dip in the sales.

After the fire incident Company is in the process of procurement and installation of new Machines for improvement in the production process The Company continues to have a strong brand image in the market and the ongoing quality improvement efforts including improvement in process capabilities, reduction of scrap will enable the Company to meet new challenges in cost, quality and productivity.

The Company, as in the previous years and  with a long term view, put lot of its efforts on Research and Development for introducing new products to its existing range to cater to its customers in the automobile sectors, children products sector where new products are being added to the existing diversified product range.

A detailed review of the companys performance and future prospects is included in the Management Discussion and analysis section of this Annual Report.

There is no change in the nature of the Business of Company during the financial year.

There have been no material changes and commitments affecting the financial position of the Company between the end of the financial year and on the date of report

DIVIDEND     

In absence of net profit during the year and to conserve the surplus reserves for the business and expansion plan of the Company, your Directors regret their inability to recommend any dividend.

RESERVES

In absence of Net Profit during the year, the Board has decided not to transfer any amount in the reserves of Company.

FIXED DEPOSITS

During the financial year under review, your Company had neither accepted nor renewed any deposit from the public within the meaning of Chapter V of the Act. There were no outstanding deposits at the beginning and closing of the financial year. Hence, disclosure of information regarding unpaid and unclaimed deposits, defaults in the repayment of deposits, maximum deposits during the year etc. is not applicable on the Company.

Number of the Meeting of the Board of Directors

The Board met 9 (Nine) times during the financial year the details of which are given in the Corporate Governance Report. The Intervening period between the two meetings was within the period prescribed by the Companies Act, 2013.

Change in Directors / Key Managerial Person:

During the financial year Mr. Krishan Murthy Vijayan  has resigned from the directorship of the Company w.e.f. 30th June, 2014.

After the date of Balance sheet, Mr. Rakesh Kumar Bhatnagar has also resigned in the meeting of Board of Directors held on 14th August, 2015 stating his personal reasons.

Notice of the meeting contains business item for the appointment of Mr. Ajay Vohra  and Mr. Naresh Kumar as Independent Director of the Company for the approval of shareholders.

Mr. Dhir Singh Bhati, Company Secretary, has resigned with effect from 13th February, 2015. Board of Directors has appointed Mr. Triloki Nath Verma has as Company Secretary and Compliance officer with effect from 2nd March, 2015.

In accordance with the provisions of the Companies Act, 2013 and the companys Articles of Association, Mrs. Mamta Handa (DIN- 00238019) is liable to retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment as Directors. The Notice convening the Annual General Meeting includes the proposals for re-appointment of Directors.

DECLARATION FROM INDEPENDENT DIRECTORS

The Company has received declaration from all the Independent directors of the Company confirming that they meet with the criteria of independence as prescribed both under sub section(6) of section 149 of the Companies Act, 2013 and Clause 49 of the Listing Agreement with Stock Exchange.

The Policy for selection of Independent Directors as approved by the Board may be accessed on the Companys website at the link http://www.okplay.in/corprate-governanace1.html

DIRECTORS RESPONSIBILITY STATEMENT

Your Directors confirm that:

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

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

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

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

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

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

EXTRACT OF ANNUAL RETURN

An extract of the annual return in Form MGT-9 is annexed as Annexure -1 of this report

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

Your Directors draw attention of the members to Note 27(6) to the financial statement which sets out related party disclosures.

Company is implementing its automotive projects through its 100% wholly owned subsidiary namely OK Play Auto Private Limited. To ensure successful development of automotive component production in OK Play Auto Private Limited, it is proposed to render all inputs, components and services as may be required on cost to cost basis.

Board of Directors, in its Meeting held on 14th August, 2014, after approval in the Audit Committee held on same date, approved the transactions pertaining to Related Party OK Play Auto Private Limited (100% wholly owned subsidiary of OK Play India Limited) and also sought approval of shareholders by way of special resolution pursuant to Section 188 of the of the Companies Act, 2013 read with applicable provisions of the Companies (Meeting of Board and its Powers) rules 2014.

The members of the Company have approved the transaction in the last Annual General Meeting held on 30th September, 2014. None of the Directors was concerned or interested in the resolution except, to the extent common directors such as Mr. Rajan Handa and Mrs. Mamta Handa, as they are the Director of the Subsidiary Company.

Transaction with other related parties are carried out in the ordinary course of business and at arms length price. These transactions are exempted under Section 188 of the Companies Act, 2013.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Companys website at the link http://okplay.in/Related-Party-Transaction-Policy.pdf

HUMAN RELATIONS

Your Company continues to enjoy cordial relations amongst all its employees. In this pursuit of creating its own management cadre, your company has recruited executives and staff at various levels, including senior management positions during the year.

INDUSTRIAL RELATIONS

During the year, your Company maintained harmonious and cordial industrial relations.

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

Statutory disclosures as required by under Section 134, particulars relating to Conservation of Energy, technology absorption, foreign exchange earnings and outgo are given in the enclosed Annexure- 2 which forms part of the report.

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provision of section 205A (5) and 205C of the companies Act, 1956 there is no/ nil amount which remain unpaid or unclaimed for a period of 7 years.

CORPORATE GOVERNANCE

It has been the endeavor of your company to follow and put into practice the code of Corporate Governance, in letter and spirit. A detailed Corporate Governance Report is attached and forms part of this report.

A certificate from the auditors of the Company regarding compliance of conditions of Corporate Governance report, as stipulated under clause 49 of the Listing Agreement, forms part of this report.

SUBSIDIARY AND ASSOCIATES COMPANY

There is no change in the subsidiary company during the year. Details of subsidiary i.e. OK Play Auto Private Limited and their business operation during the year under review are covered in the annual report. Report on the performance and financial position of subsidiary and associate company as per the Companies Act, 2013 is included in this report and hence not repeated here for the sake of brevity.

The Policy for determining material subsidiaries as approved may be accessed on the Companys website at the link: http://okplay.in/policy_for_determining_material_subsidiaries.pdf

The Company will make available the Annual Accounts of the subsidiary company 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 company will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary company. The Consolidated Financial statements presented by the Company include the financial results of its subsidiary company.

CONSOLIDATED FINANCIAL STATEMENTS

Your Directors have pleasure in attaching the Consolidated Financial Statements pursuant to Clause 32 of the Listing Agreement entered into with the Stock Exchanges and prepared in accordance with the Accounting Standards prescribed by the Institute of Chartered Accountants of India, in this regard.  

MANAGEMENT DISCUSSION AND ANALYSIS

A Management Discussion and Analysis Report  highlighting the performance and prospects of the Companys plastic manufacture businesses (as stipulated under Clause 49 of the listing agreement) is attached in a separate  section and forms part of this report.

PARTICULARS OF EMPLOYEES

The Table containing the names and other particulars of employees in accordance with the provisions of Section 197(12), of the Companies Act, 2013, read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personal) Rules, 2014, is appended as Annexure 3 to this Report.

There was no employee employed throughout the financial year and in receipt of the Rs. 60 Lakh or more or employed for part of the year and in receipt of the Rs. 5 Lakh per month or more during the year.  Disclosures under Rule 5 (2) of the Companies Appointment and Remuneration of Managerial Personal) Rules, 2014, are not applicable on the Company.

DEMATERIALISATION OF SHARES

As on 31st March, 2015, 95.11 % (approx) of equity shares out of the total subscribed capital have been dematerialized.

Under the Depository System, the International Securities Identification Number (ISIN) allotted to the Companys Equity Shares is INE870B01016.

AUDITORS

M/s S. P. Marwaha & Co., Chartered Accountants, the present auditors of the company have resigned in the Board Meeting held on 14th August, 2015. Audit Committee has obtained a certificate and letter of consent from M/s D. S. Chadha & Associates, Chartered Accountants (FRN-026723-N) that appointment, if made, will be in accordance with the requirement of Companies Act, 2013, and they are not disqualified for re-appointment within the meaning of  the said Act. Board of Director also recommends the appointment of M/s D. S. Chadha & Associates, Chartered Accountants (FRN-026723-N) as Auditor of the Company till the conclusion of 27th Annual General Meeting.

NOTES ON ACCOUNTS

The notes to the accounts referred to by the Auditors in their report are self-explanatory and may be treated as information/explanation submitted by the Board.

The auditors report presented by M/s. S. P. Marwaha & Co., Chartered Accountants, Statutory Auditors on the accounts of the Company for the financial year ended 31st March, 2015 is self explanatory and requires no comments.

INTERNAL AUDITOR

The Board of Directors has appointed, M/s. Jain Sanjeev Kumar & Associates, Chartered Accountants (FRN- 08231C) for conducting Internal Audit for the financial year 2015-16. The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

COST AUDITORS

The Board of Directors has appointed, M/s. Goyal & Goyal Associates, Cost Accountants for conducting Cost Audit for the financial year 2015-16.

SECRETARIAL AUDITORS AND SECRETARIAL AUDIT REPORT

The Board of Directors has appointed M/s. Mukesh Agarwal & Co., Company Secretaries (COP- 3851), for conducting Secretarial Audit for the financial year 2014-15. Copy of Secretarial Audit Report is annexed as Annexure 4 of this report.

Your director submits that the changes in the Companies law have brought significant changes in the Compliance Reporting. Compliance Reporting has been increased manifold without giving any transition period.  These changes are still continuing and thus lead to ambiguity, confusion on the interpretation of provisions under the Companies Act, 2013. These changes, ambiguity and confusion on the interpretation resulted in the non compliance of new provisions. Parawise reply on the qualifications made under Secretarial Auditors Report is as under:

1.         Company is in the process of inviting application and interviewing the candidate for the appointment of CFO. This compliance will be done in the next Board Meeting. 

2.         Board of Directors in its meeting held on 14th August, 2015 have appointed M/s.  Jain Sanjeev Kumar & Associates, as internal auditor of the Company. This compliance has been done by the Company.

3.         In the 25th Annual General Meeting, shareholders have authorized the Board to Borrow the money upto Rs. 200 Crores. Copy of this resolution has been filed with ROC in due course.  Subsequent filing of each and every resolution was done when Board became aware of the new compliance regime. This is an inadvertent error without any prejudice to the stakeholders. However, Company will seek condonation of delay from Central Government for filing of same.

4.         Related Party Transaction with subsidiary company are approved by the Shareholders in the 25th Annual General Meeting. Transaction with other entities has been done in the regular course of business at arms length price which is exempt under Section 188 itself and requires no approval.

5.         Notice for the ensuing Annual General Meetings contains the proposal for the appointment of Independent Directors.

LISTING OF SECURITIES

Presently, the Securities of the Company are listed at the Bombay Stock Exchange Ltd., The Ahmedabad Stock Exchange Ltd., and the Jaipur Stock Exchange Ltd. Honble BIFR has directed Ahmedabad Stock Exchange Ltd. and Jaipur Stock Exchange Limited to waive off the arrears and allow the delisting of the companys shares from these stock exchanges. 

VIGIL MECHANISM/ WHISTLE BLOWER POLICY

The Company has formulated a Whistle Blower Policy. The Policy comprehensively provides an opportunity for any employee/ Director of the Company to rise any issue concerning breaches of law, accounting policies or any act resulting in financial loss and misuse of Companys funds/ property or suspected or actual fraud. The Policy provides for a mechanism to report such concerns to the Audit Committee through specified channels. The Policy has been communicated to the employees and also posted on the Companys Website. The Whistle Blower Policy complies with the requirements of Vigil mechanism as stipulated under Section 177 of the Companies Act, 2013. The details of establishment of the Whistle Blower Policy/Vigil mechanism has been disclosed on the website of the Company at the link: http://okplay.in/Whistle-Blower-Policy.pdf

CORPORATE SOCIAL RESPONSIBILITY

Provisions of Section 135 were not applicable on the Company during the period.

SIGNIFICANT AND MATERIAL ORDERS

There are no significant and/or material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of the Company.

BOARD EVALUATION

Pursuant to provision of the Companies Act, 2013 and Clause-49 of the Listing Agreement, the Board has carried out an Annual Performance Evaluation of its own performance and the Directors individually.

The manner of evaluation of Non-independent Directors, Chairman and the Board as a whole was done at a separate meeting held by Independent Directors.

The performance evaluation of Independent Directors was done by the entire Board, excluding Directors being evaluated.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. There were no complaint received from any employee during the Financial Year 2014-2015 and hence no compliant is outstanding as on 31.03.2015 for redressal.

REMUNERATION POLICY

The Board has framed a policy for selection and appointment of Directors, Senior Manager and their remuneration.      

ACKNOWLEDGEMENT

The Board of Directors wishes to place their appreciation of the companys clients, vendors, bankers, and investors for their continued support during the year.

Your Directors also wish to place on record their deep appreciation of the dedication and contribution made by employees at all levels, who through their competence, hard work and support have enabled the company to work efficiently and look forward to their continued support in future as well.

Annexure 2: CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Information required under section 134 of the Companies Act, 1956 read with the rules made therein

A.        CONSERVATION OF ENERGY

a)    Energy conservation measures taken:

Energy conservation efforts are ongoing activities. During the year under review further efforts were made to ensure optimum utilization of fuel and electricity.

b) Relevant data in respect of energy consumption is as below:

POWER CONSUMPTION*: 

* Allocated Figures

B.         TECHNOLOGY ABSORPTION

The Company does not depend on foreign technology for manufacturing of its engineering range of products. In fact, the Company is self-reliant in the design as well as in the manufacturing process of moulds. For the new generation range of automotive parts your company having a technology transfer arrangement with M/s Solar Plastic Inc a USA based company.

Research and Development:-

a.        Specified Areas in which the Company carries out R&D: -

The focus on Research and Development activity during the current year continued on development of new products & variants thereof apart from improving the existing products and value engineering of products.

b.        Benefit derived as a result of above R&D: -

During the year, various types of Furniture such as Dual Desks besides other items have been developed and production of the same commenced successfully.

c.        Future plan of Action.

            Further development of moulds and products based on market requirement.                                                                                                                                                                                                                                                                                                                                                                                                                                                 

d.        Expenditure on Research and Development:-

            The following Expenditure was incurred on conducting R&D.

Rs. in Lakhs

C.        FOREIGN EXCHANGE EARNINGS AND OUTGO:

            a.        Earnings       

                        Foreign exchange earnings during the year were NIL

                        (Previous year   Rs. 24,01,012.00/-)

            b.        Outgo           

.                       Foreign exchange outgo during the year was Rs.119366797.84/-

                        (Previous year Rs. 6,76,07,267.81/-)

                                                                                                       for OK PLAY INDIA LTD.

                                                                                                                        -Sd-

Place: New Delhi                                                                      Justice T. R. Handa (Retd.)

Date: 14th August, 2014                                                            Chairman cum Whole Time Director

ANNEXURE-3: DISCLOSURES REQUIRED WITH RESPECT TO SECTION 197(12) OF THE COMPANIES ACT, 2013.

The ratio of the remuneration of each Director to the median employees remuneration and such other details in terms of Section 197(12) of the Companies Act, 2013 read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

I.     The ratio of the remuneration of each director to the median remuneration of the employees of the company for the financial year

II.   The percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year

There was no increase in the salary of directors during the year. There is no CFO at present in the Company and salary of Company Secretary has been reduced by 22% during the year due to change in the company secretary during the year.

The percentage increase in the median remuneration of employees in the financial year

The percentage increase in the median remuneration of employees in the financial year is around 7.36%.

III.  The number of permanent employees on the rolls of company

The number of permanent employees as on 31st March, 2015 is 139.

IV. The explanation on the relationship between average increase in remuneration and company performance

The Company follows prudent remuneration practices under the guidance of the Board and Remuneration & Nomination Committee. The Companys approach to remuneration is intended to drive meritocracy within the framework of prudent risk management. Remuneration is linked to corporate performance, business performance and individual performance.

The Company has a judicious and prudent approach to compensation and does not use compensation as the sole lever to attract and retain employees. Employee compensation takes into account a mix of salary, allowances and perquisites.

The increase in remuneration is a function of factors outlined above.

V.   Comparison of the remuneration of the Key Managerial Personnel against the performance of the company

VI.     Variations in the market capitalization of the company, price earnings ratio as at the closing date of the current financial year and previous financial year and percentage increase or decrease in the market quotations of the shares of the company in comparison to the rate at which the company came out with the last public offer in case of listed companies

Increase in the market quotations of the equity shares in comparison to the rate at which the last public offer made in February, 1994

VII.    Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration

The average percentage increase made in the salaries of total employees other than the Key Managerial Personnel for during the period is around 12.35% while the average increase in the remuneration of the Key Managerial Personnel is Nil.  This increment is in line with the factors outlined in point (v) above.

VIII.  Comparison of remuneration of each of the Key Managerial Personnel against the performance of the company

The ratio of the remuneration of each KMP to the PAT of the Bank is given below:

IX.     The key parameters for any variable component of remuneration availed by the directors

Not Applicable

X.       The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year.

Not Applicable

XI.     Affirmation that the remuneration is as per the remuneration policy of the company 

Yes

Annexure 4: SECRETARIAL AUDIT REPORT

FORM NO. MR-3

SECRETARIAL AUDIT REPORT

FOR THE FINANCIAL YEAR ENDED MARCH 31, 2015

[Pursuant to Section 204(1) of the Companies Act, 2013 and Rule No. 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]

To,

The Members,

OK PLAY INDIA LIMITED

17 ROZ KA MEO INDUSTRIAL ESTATE,

Tehsil Nuh, Dist Mewat,  HARYANA-122103

We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by OK PLAY INDIA LIMITED (hereinafter called the Company). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing our opinion thereon.

Based on our verification of OK PLAY INDIA LIMITED books, papers, minute books, forms and returns filed and other records maintained by the Company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, We hereby report that in our opinion, the Company has, during the audit period covering the financial year ended March 31, 2015, complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance mechanism in place to the extent, in the manner and subject to the reporting made hereinafter.

We have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year ended on March 31, 2015 according to the provisions of:

(i).            Companies Act, 2013 and the rules made thereunder, and The Companies Act, 1956 and rules made there under to the extent applicable.

(ii).            The Securities Contracts (Regulation) Act, 1956 (SCRA) and the rules made thereunder.

(iii).            The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder.

(iv).            Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings (ECB).                                                                                            

(v).            The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (SEBI Act):-

            (v).

a.       The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.

b.      The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992.

c.       The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009.

d.      The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999.                                        Not Applicable

e.       The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008.                                                                                              Not Applicable

f.        The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client.

g.       The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009.                                                                                                                     Not Applicable

h.      The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998.

          Not Applicable

(vi)            RBI Act, 1934                                                                                                                            Not Applicable

(vii)          Non-Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007.                                                                          Not Applicable

(viii)     Industrial and Labour Laws which inter- alia includes  (based on the confirmation received from the Management)

The Minimum Wages Act, 1936

The Payment of Bonus Act, 1965

The Payment of Gratuity Act, 1972

The Employees Provident Fund & Miscellaneous Provisions Act, 1952

The Employees State Insurance Act, 1948 etc.

Factory Act, 1948

Equal Remuneration Act, 1976

Punjab Fund Welfare Act, 1965

Payment of Wages Act, 1936

The Workmens Compensation Act, 1923

The Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959

Contact Labour (Regulation and Abolition) Act, 1970

         We have also examined compliance with the applicable clauses of the following:

(i) Secretarial Standards issued by The Institute of Company Secretaries of India.

                                                                                                      Not Applicable

                (ii)                 The Listing Agreements entered into by the Company with Bombay Stock Exchange.

During the period under review the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards, etc. mentioned above subject to the following Observations:

a)    Observations/ Non Compliances/ Adverse Remarks/ Qualifications in respect of Companies Act 2013 and rules made there under are as follows:

         The Company has not appointed CFO during the audit period as required under Section 203 of Companies Act, 2013.

         The Company has not appointed Internal Auditor during the audit period as required under Section 138 of Companies Act, 2013.

         The Company has passed Special Resolution under Section 180(1) (c) of the Companies Act,  2013 in Annual General Meeting held on 30th September, 2014.

         Resolution required to be register with ROC regarding Cash Credit facility from Indian Overseas Bank was not filed with ROC

         Resolution required to be register with ROC regarding Loan Facility from Genesis finance Company Limited was not filed with ROC.

         Prior approval under Section 188 Companies Act, 2013 is not obtained for Related Party Transactions.

b)    Observations/ Non Compliances/ Adverse Remarks/ Qualifications in respect of Listing  Agreement Compliance are as follows:

         The Company is not duly constituted with proper Balance of Executive Directors, Non Executives Directors as required under clause 49 of the listing agreement.

         Independent Director of the Company is not appointed as director in the Board of Director of the Material Non Listed Subsidiary Company OK Play Auto Private Limited.

We further report that :

The Board of Directors of the Company is not duly constituted with proper balance of Executive Directors, Non-Executive Directors and independent Directors. The changes in the composition of the Board of Directors which took place during the period under review were carried out in compliance with the provisions of the Act.

Adequate notice is given to all Directors to schedule the Board Meetings, Agenda and detailed notes on Agenda were sent to the Directors at least seven days in advance, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting.

We further report that based on the information received and records maintained by the Company, there are adequate systems and processes in the Company commensurate with the size and operations of the Company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.

Place : Delhi                                                                          

Date :                                                                  for Mukesh Agarwal & Co.

Mukesh Kumar Agarwal

M No-F5991

C P No.3851

Annexure 5: Certificate from Secretarial Auditors under Clause 49 of listing agreement.

REPORT OF THE DIRECTORS ON THE CORPORATE GOVERNANCE

1. COMPANYS PHILOSOPHY ON CODE OF GOVERNANCE

Your Company is of the belief that sound Corporate Governance is vital to enhance and retain stakeholders trust.  Good Governance underpins the success and integrity of the organization, institution and market. The essence of Corporate Governance  lies in promoting and maintaining integrity, transparency and accountability in the higher level of management and your Company believes that good Corporate Governance contemplates that corporate actions balance the interest of all stakeholders and satisfy the tests of accountability, transparency, empowerment and integrity for the efficient and ethical conduct of businesses.

In the Line of above philosophy, your company continuously strives for excellence through adoption of best governance and disclosure practices. OK Plays code of Corporate Governance has been drafted in compliance with the code of corporate governance as promulgated by the SEBI.

2. BOARD OF DIRECTORS

The Board of Directors consists of 7 (seven) Directors including one woman director out of which three are Non-executive Directors. Mr. Rakesh Kumar Bhatnagar has resigned in the meeting held on 14th August, 2015. Board of Directors has proposed appointment of two more Independent Directors in the notice of ensuing Annual General Meeting. After appointment, composition of Board will be 8 (eight) Directors (excluding outgoing director) out of which four are executive directors & four are non executive & independent directors. All the directors are eminent professionals with experience in Business, Industry, Finance and Law. The company has an executive chairman. The Board is responsible for the management of the business and meets regularly for discharging its role and functions.

The Company has an optimum combination of Executive, Non-Executive and Independent Directors who are eminent person with professional expertise and valuable experience. None of the Director on the Board is a member of more than 10 committees, and Chairman of More than 5 Committees across the companies in which he is a Director. The necessary disclosures regarding committee positions have been made by the Directors.

BOARD MEETINGS

During the year under review 08 (Eight) Board meetings were held i.e. on 30th May, 2014, 27th June, 2014, 2nd August, 2014, 14th August, 2014, 3rd September, 2014, 21st October, 2014, 14th November, 2014, 9th January, 2015 & 12nd February, 2015.  The Company had its last Annual General Meeting of Shareholders on 30th September, 2015.    

The particulars of composition of the Board of Directors and attendance of Directors at Board Meetings, Annual General Meeting and also number of other directorships and committee membership/chairmanship are as follows:

.

3. COMMITTEE OF BOARD OF DIRECTORS

The Board Committees play a crucial role in the governance structure of the company and are constituted to deal with specific areas/ activities which concern the company and are considered to be performed by members of the Board. The Board of Directors had constituted three Committees of the Board, which are:

1. Audit Committee,

2. Nomination and Remuneration Committee,

3. Stakeholders Relationship Committee.

4. Share Transfer Committee.

5. Risk Management Committee.

1. AUDIT COMMITTEE

The Company has a qualified and independent audit Committee comprising of two Independent and one Executive Director of the Company.  The Chairman is an independent Director. The terms of reference of the Audit Committee are in consonance with provisions of the Companies Act, 2013 and the guidelines set out in the clause 49 of the Listing Agreements with the Stock exchanges.

Minutes of meetings of the audit committee are circulated to members of the committee and the Board is kept apprised.

COMPOSITION

The Audit Committee comprises of the following Directors: -

The Chairman of the Audit Committee is always an independent & Non-executive director and is appointed by the members of committee in the meeting.

Members of Audit Committee have requisite financial and management expertise. The Company Secretary acts as the Secretary to the committee.

During the year under review the Committee met on 30th May, 2014, 14th August, 2014, 14th November, 2014 & 12nd February, 2015

2. NOMINATION AND REMUNERATION COMMITTEE

During the year, the nomenclature of the Remuneration Committee of Directors was changed to Nomination and Remuneration Committee and reconstituted on 14th August, 2014. The nomination and remuneration committee, a constitution of which is a mandatory requirement, was constituted to meet the requirements of Clause 49 of the Listing Agreement read with the relevant Provision of the Companies Act, 2013 by the Board of Directors to recommend/review the remuneration package of Whole-Time-Directors. The Remuneration of the Managing Director and the Whole-Time-Directors were approved by the Remuneration Committee, Board of Directors and the shareholders of the Company on his re-appointment in the Annual General Meeting held on 30th September, 2015.

COMPOSITION

The Remuneration Committee comprises of the following Directors: -

1. Mr. Shalabh Jasoria                           Independent & Non-executive

2. Mr. Vijayendra Kumar Jain                 Independent & Non-executive

3. Mr. Rakesh Kumar Bhatnagar            Independent & Non-Executive

Sh. Shalabh Jasoria is Chairman of the Remuneration Committee. Non Executive Directors were not paid anything during the financial year 2014-2015 The details of amount provided towards Directors remuneration are as follows:

                                                                                                            (In Rs.)

The Company has not provided for any performance linked incentive or Stock Option or Convertible instruments to the Director of the Company.

The Directors of the Company are appointed by the Shareholders upon recommendation of the Board of The Directors within the framework of the Companies Act, 2013 as well as the Articles of the Association of the Company. The resolution passed by these two governing bodies together with the service rules of the company covers the terms, conditions and remuneration of such appointment. There is no service contract separately entered into by the Company with the Directors. Further, the resolutions appointing these Directors, do not prescribe for the payment of any separate Severance Fees to them. However, the requirement of notice period is as per the service rules of the Company. 

STAKEHOLDERS RELATIONSHIP COMMITTEE

The Shareholders/Investors Grievances Committee was constituted on 22nd March, 2003 in terms of Listing Agreement. The Nomenclature of the Shareholders/Investors Grievances Committee has been changed to Stakeholders Relationship Committee. The Committee looks into resolution and redressal of shareholders/investors complaints related to transfer, transmission of shares, non-receipt of annual reports, dividend and e-voting problems. The Company Secretary attends the Shareholders Grievances Committee.

COMPOSITION

The Stakeholders Committee comprises of the following:-

1. Mr. Shalabh Jasoria                  Independent Director (Chairman of the Committee)

2. Dr. Rajan Wadhera                   Executive Director

3. Mr. Rajan Handa                       Executive Director

During the year the Company received 3 (Three) complaints from shareholders. All the complaints were attended promptly and resolved to the satisfaction of the shareholders.

No grievance of any investor was pending as on 31st March, 2015.

SHARE TRANSFER COMMITTEE

The Companys shares are compulsorily required to be traded in dematerialized form. Hence, the committee met at regular intervals considering the volume of transfers received in the physical segment.

The Share Transfer Committee comprises of the following:-

1. Justice T. R. Handa                    Chairman cum Whole-Time-Director

2. Mr. Rajan Handa                       Managing Director

3. Mrs. Mamta Handa                   Whole-Time-Director

During the year the committee met 20 times on 23rd June, 2014, 11th August, 2014, 16th August, 2014, 25th August, 2014, 15th September, 2014, 13th October, 2014, 3rd November, 2014, 17th November, 2014, 1st December, 2014, 8th December, 2014, 22nd December, 2014, 5th January, 2015, 12nd January, 2015, 9th February, 2015, 16th February, 2015, 23rd February, 2015, 9th March, 2015, 16th March, 2015, 23rd March, 2015, & 30th March, 2015.

None of the Directors of the Company were members in more than 5 Committees nor acted as a Chairman of more than 5 Committees including all companies in which they were Directors.

Risk Management Committee

In terms of Clause 49 of the Listing Agreement, a Risk Management Committee of the Board of Directors was constituted on 2nd August, 2014. Mr. Rajan Handa is the chairman of the Committee and Mrs. Mamta Handa, Dr. Rajan Wadhera and Mr. Shalabh Jasoria are the member of the Committee. The Company Secretary acts as the Secretary to the Committee. The role and responsibilities of the Risk Management Committee are as prescribed under clause 49 of the Listing Agreement, as amended from time to time involves review the establishment and adherence of the Company's enterprise risk management framework and also review the efficacy and adequacy of the Risk Management System working in the Company.

During the year, Risk Management Committee meeting had held on 12.02.2015. All the Member had attended this meeting.

4.  ANNUAL/ EXTRA-ORDINARY GENERAL MEETINGS

5 (Five) special resolution was put through e-voting / postal ballot at the Annual General Body Meeting  held on 30th September, 2014 during the last year.

(A)            Year 2014

1.      Increase in borrowing limits up to a sum of Rs. 200 crore (Rupees two hundred crore) over and above the aggregate of the paid up capital of the Company and its free reserves

2.      Payment of remuneration to managing director Mr. Rajan Handa ( DIN 00194590)

3.      Payment Of Remuneration To Whole Time Director Justice Tilak Raj Handa( DIN 00194284)

4.      Appointment and payment of remuneration to Dr. Rajan Wadhera( DIN 01412577) as Whole Time Director

5.      To render/sale, purchase all inputs, components and services as may be required to the OK Play Auto Private Limited on cost to cost basis.

(B)              Year 2013

No Special Resolution was passed in the Annual General Meeting held in 2013.

(C)            Year 2012

To approve the re-appointment of Mrs. Mamta Handa as Whole Time Director and remuneration payable to her.

5.     Notes on Directors seeking appointment/reappointment as required under Clause 49VIII (E) of the Listing agreement entered into with the Stock Exchanges.

6. DISCLOSURESYour Directors draw attention of the member to note 27(6) to the financial statement which sets out related party disclosures. The Company has fulfilled all statutory compliances except the payment of listing fees to  Delhi Stock Exchange, Ahmadabad and Jaipur Stock Exchange Ltd. Where the securities of the Company are listed. Honble BIFR has directed Ahmadabad Stock Exchange Ltd. and Jaipur Stock Exchange Limited to waive off the arrears and allow the delisting of the companys shares from these stock exchanges. The Whistle Blower Policy complies with the requirements of Vigil mechanism as stipulated under Section 177 of the Companies Act, 2013. The details of establishment of the Whistle Blower Policy/Vigil mechanism has been disclosed on the website of the Company at the link: http://okplay.in/Whistle-Blower-Policy.pdf Company commits to comply with the requirements of the Clause 49 in its words and spirits.

Separate Meetings of Independent Directors

As stipulated the Code of Independent Directors under the Companies Act, 2013 and the Listing Agreement, a separate Meeting of the Independent Directors of the Company was held 12th February, 2015 to review the performance of Non-Independent Directors (including the Chairman) and the Board as whole. The Independent Directors also reviewed the quality, content and timeliness of the flow of information between the Management and the Board and its Committee which is to effectively and reasonably perform and discharge their duties.

Familiarization Programme for Directors

The Independent directors of Company are eminent personalities having wide experience in the field of business, finance, industry, commerce and administration. Their presence on the Board has been advantageous and fruitful in taking business decisions. Independent Directors are appointed as per the Governance guidelines of the Company, with management expertise and wide range of experience.

The Directors appointed by the Board are given induction and orientation with respect to the Company's vision, strategic direction, core values, including ethics, corporate governance practices, financial matters and business operations by having one-to-one meetings. Board members are also requested to access the necessary documents brochures, Annual Reports and internal policies available at our website to enable them to familiarize with the Company's procedures and practices. Periodic presentations are made by Senior Management, at the Board/Committee meetings on business and performance updates of the Company, global business environment, business risks and its mitigation strategy, impact of regulatory changes on strategy etc. Updates on relevant statutory changes encompassing important laws are regularly intimated to the Directors.

Prohibition of Insider Trading

With a view to regulate Trading in Securities by the Directors and Designated Employees, the Company has adopted a "Code of Conduct for Prohibition of Insider Trading".

7. MEANS OF COMMUNICATION

The Company published its Quarterly, Half Yearly Un-audited Financial Results and Audited Financial Results in the prescribed form. The results were forthwith sent to Stock Exchanges where the securities of the Company are listed and also published in the Newspapers namely Pioneer (English) & Veer Arjun (Hindi). The Management discussion and analysis report form part of this annual report.

The Company has posted information regarding policies and listing compliances under the Investor relation page of its web site that is www.okplay.in

8. SECRETARIAL AUDIT FOR RECONCILIATION OF CAPITAL

A qualified practicing Company Secretary carried out quarterly Secretarial Audit to reconcile the total admitted capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) and the total issued and listed capital. The audit confirmed that the total issued /paid up capital was in agreement with the aggregate of the total number of shares in physical form and the total number of dematerialized shares held with NSDL and CDSL.

9. CEO/CFO CERTIFICATION

In terms of requirements of clause 49 (IX) of the Listing Agreement the Managing Director and CFO have submitted necessary certificate to the Board stating the particulars specified under the said clause. This certificate has been reviewed by the Audit Committee and taken on record by the Board of Directors at their respective meetings on 30th May, 2015.

10. GENERAL SHAREHOLDERS INFORMATION

General shareholders information has been given under shareholders diary, which is attached to this Annual Report.

 MANAGEMENT DISCUSSION AND ANALYSIS REPORT

As expected, the importance given by the Company to products made of metal and wood, besides plastic molded products, has yielded good results for the company as can be seen from the substantial jump in the sales over the previous year. The Company has achieved its goal of product diversification & reach by segregating the operations into various separate production centers to enhance production numbers and to bring in production efficiency.

The production of plastic molded products is also increasing with the signing of the exclusivity agreement with clients in auto and other sectors. Company is also exploring the opportunities through presence and direct contact with its clients. Company also sees an opportunity in government projects.

Management of the Company is very confident on its (Innovation and Designing capabilities which enables the company to develop products across a wide range of industries. The children products category will see a major expansion with its innovations, designs and new range.

SEGMENT WISE PERFORMANCE

All the operations of the company are considered as a single business segment.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The company has an adequate and effective system of internal checks and controls to ensure proper accounting and utilization of all assets.

The Audit Committee of the Board of Directors regularly reviews the effectiveness of the internal control systems to ensure due compliances with various applicable laws, accounting standards and regulatory guidelines.

HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT

Human resources in OK play is the name of the function within an organization charged with the overall responsibility for implementing strategies and policies relating to the management of individuals In OK Play, an organization's human resource management strategy maximize return on investment in the organization's human capital and minimize financial risk. HR Department achieve this by aligning the supply of skilled and qualified individuals and the capabilities of the current workforce, with the organization's ongoing and future business plans and requirements to maximize return on investment and secure future survival and success.

Key functions

Human Resources may set strategies and develop policies, standards, systems, and processes that implement these strategies in a whole range of areas. The following are typical of a wide range of organizations:

Recruitment, selection, and on-boarding (resourcing)

Organizational design and development

Business transformation and change management

Performance, conduct and behavior management

Industrial and employee relations

Safety and health management

Human resources (workforce) analysis and workforce personnel data management

Compensation, rewards, and benefits management

Training and development (learning management) Implementation of such policies, processes or standards may be directly managed by the HR function itself, or the function may indirectly supervise the implementation of such activities by managers, other business functions or via third-party external partner organizations.

HRM strategy

An HRM strategy pertains to the means as to how to implement the specific functions of HRM. An organization's HR function may possess recruitment and selection policies, disciplinary procedures, reward/recognition policies, an HR plan, or learning and development policies; however all of these functional areas of HRM need to be aligned and correlated, in order to correspond with the overall business strategy. An HRM strategy thus is an overall plan, concerning the implementation of specific HRM functional areas. An HRM strategy typically consists of the following factors:

"Best fit" and "best practice" - meaning that there is correlation between the HRM strategy and the overall corporate strategy. As HRM in OK Play as a field seeks to manage human resources in order to achieve properly organizational goals, an organizations HRM strategy seeks to accomplish such management by applying a firm's personnel needs with the goals/objectives of the organization. As an example, a firm selling toys and plastic components could have a corporate strategy of increasing the sales by 10% over a one year period. Accordingly, the HRM strategy would seek to facilitate how exactly to manage personnel in order to achieve the 10% figure. Specific HRM functions, such as recruitment and selection, reward/recognition, an HR plan, or learning and development policies, would be tailored to achieve the corporate objectives.

Close co-operation is always there between HR and the top/senior management, in the development of the corporate strategy. Theoretically, a senior HR representative always present when an organization's corporate objectives are devised. The personnel's proper management is vital in the firm being successful, or even existing as a going concern. Thus, HR can be seen as one of the critical departments within the functional area of OK play.

Continual monitoring of the strategy, via employee feedback, surveys, etc. The implementation of an HR strategy is not always required, and may depend on a number of factors, namely the size of the firm, the organizational culture within the firm or the industry that the firm operates in and also the people in the firm. An HRM strategy is divided, in general, into two facets - the people strategy and the HR functional strategy. The people strategy pertains to the point listed in the first paragraph, namely the careful correlation of HRM policies/actions to attain the goals laid down in the corporate strategy. The HR functional strategy relates to the policies employed within the HR functional area itself, regarding the management of persons internal to it, to ensure its own departmental goals are met.

Human resource management in OK Play involves in several processes. These processes can be performed in an HR department, but some tasks can also be outsourced or performed by line-managers or other departments. When effectively integrated they provide significant economic benefit to the company.

The Employee Strength of the company is 131.

CAUTIONARY STATEMENT

Statement in this Management Discussion and Analysis Report containing the Companys objectives, expectations, projections, estimates about the Companys strategy for growth, product development, market share, controls may be forward looking statement within the meaning of applicable securities laws and regulations.

Forward Looking Statements are based on certain assumptions and expectations of future events. Actual results could differ materially from those expressed or implied, depending upon economic conditions, demand, supply, change in government policies, price conditions, political conditions, economic scenario and various other incidental factors within or outside the country.

Dated: 14th August, 2015

Regd. Office :-                                                    By order of the Board of Directors

17, Roz-Ka-Meo Industrial Estate,                                          for OK PLAY INDIA LTD.

Tehsil. Nuh, Distt. Mewat Haryana

         Justice T.R.Handa (Retd.)

                                                                      Chairman-cum-Whole-time Director

SHAREHOLDERS DIARY

1. DATE, TIME & VENUE OF THE ANNUAL GENERAL MEETING

30th September, 2015 at 10.00 A.M. at Hakim Ji Ki Choupal, Opposite Batra Hospital, Village Ujina, P.S. Nuh, District Mewat (Haryana).

2. PARTICULARS OF FINANCIAL CALENDAR

3. LISTING INFORMATION

Shares of your Company are listed on following Stock Exchanges:

Bombay Stock Exchange Limited

Ahmedabad Stock exchange Limited                                   

Jaipur Stock Exchange Ltd.

The Honble BIFR vide its order dt. 6/12/2005 has directed the Ahmedabad Stock Exchange and the Jaipur Stock Exchange to waive off arrears of Listing fees payable and allow delisting of shares from these stock exchanges. 

4. STOCK CODE

5.   SHARES OF OK PLAY INDIA  LTD. ARE TRADED IN DEMAT FORM :

National Securities Depository Ltd.

                                                                          ISIN Code No. of Shares INE 870B01016

Central Depository Services (I) Ltd.

6.  BOOK CLOSURE

From: 23rd September, 2015 To: 30th September, 2015 (Both days inclusive)

7.  INVESTOR SERVICE CELL

The Companys Investors Service Cell is functioning at

17-18 Roz-Ka-Meo Industrial Estate,

Mewat (Haryana)

E-mail : investor.relations@okplay.in

8. COMPLIANCE OFFICER:

Mr. Triloki Nath Verma, Company Secretary

9.  ADDRESS FOR CORRESPONDENCE

OK PLAY INDIA LIMITED

17-18 Roz-Ka-Meo Industrial Estate

Tehsil Nuh, Distt. Mewat

Haryana - 122103

10. REGISTRAR AND SHARE TRANSFER AGENTS

MAS SERVICES LTD.

T-34, IInd Floor, Okhla Industrial Area,

Phase-II, New Delhi- 110 020

Ph. 011-26387281/82/83/41320335/36.

11. SHAREHOLDING PATTERN AS ON 31ST MARCH, 2015

12. DISTRIBUTION OF SHAREHOLDING AS ON 31ST MARCH, 2015

FINANCIAL RESULTS OF COMPANY[i] Rs. In Lacs Current Year ended on 31st March, 2015Previous Year ended on 31st March , 2014 Sales (Gross)595,3.3911705.80 Other Receipt 22.50 27.99 Profit/(Loss) before exceptional and extraordinary items and Tax (89.42)462.69 Exceptional item: (Net gain/(Loss) on Exchange Fluctuation on FCCB/ECB (141.75)(347.65) Profit/(Loss) before extraordinary items and Tax (231.17)115.04 Provision for tax for earlier years- 13.32 Profit/(Loss) before Tax(231.17)101.72 Current Tax -(54.00) Provision for Tax for earlier years written back(67.32)(465.09) Profit/(Loss ) for the year (163.85)(417.36) OPERATIONS The sales in the year under review have decreased by Rs. 5751.81 Lacs from Rs. 11705.80 Lacs to Rs. 5953.39 Lacs. This is an decrease of 49.14% (Approx) in current year compared to the last year. During the year the Rupee weakened against the dollar and consequently there was an Exchanges Fluctuation Loss of Rs. 141.75 Lacs in the current year. There was a fire at the plant on the intervening night between 9th & 10th January, 2015 in which the company lost its stocks and part of the Building and Plant & Machinery. The company has incurred a loss of Rs 22.25 crores due to the fire which have been reflected in Other Expenses. Due to this mish happening, a major chunk of finish goods was destroyed which resulted in the dip in the sales. After the fire incident Company is in the process of procurement and installation of new Machines for improvement in the production process The Company continues to have a strong brand image in the market and the ongoing quality improvement efforts including improvement in process capabilities, reduction of scrap will enable the Company to meet new challenges in cost, quality and productivity. The Company, as in the previous years and with a long term view, put lot of its efforts on Research and Development for introducing new products to its existing range to cater to its customers in the automobile sectors, children products sector where new products are being added to the existing diversified product range. A detailed review of the company’s performance and future prospects is included in the Management Discussion and analysis section of this Annual Report. There is no change in the nature of the Business of Company during the financial year. There have been no material changes and commitments affecting the financial position of the Company between the end of the financial year and on the date of report

CONSERVATION OF ENERGY a) Energy conservation measures taken: Energy conservation efforts are ongoing activities. During the year under review further efforts were made to ensure optimum utilization of fuel and electricity. b) Relevant data in respect of energy consumption is as below: POWER CONSUMPTION*: Current Year Ending 31.03.2015Previous Year Ending 31.03.2014 a. Electricity Purchased 1. Units17705131864352 2. Total Amount (Rs. in Lacs)144.57162.53 3. Rate / unit 8.178.71 b. HSD Fuel Consumption 1. Quantity (K.ltrs) (for production purpose) 342.24533.95 2. Total Amount (Rs. in Lacs)187.45270.97 * Allocated Figures

The Company does not depend on foreign technology for manufacturing of its engineering range of products. In fact, the Company is self-reliant in the design as well as in the manufacturing process of moulds. For the new generation range of automotive parts your company having a technology transfer arrangement with M/s Solar Plastic Inc a USA based company. Research and Development:- a. Specified Areas in which the Company carries out R&D: - The focus on Research and Development activity during the current year continued on development of new products & variants thereof apart from improving the existing products and value engineering of products. b. Benefit derived as a result of above R&D: - During the year, various types of Furniture such as Dual Desks besides other items have been developed and production of the same commenced successfully. c. Future plan of Action. Further development of moulds and products based on market requirement. d. Expenditure on Research and Development:- The following Expenditure was incurred on conducting R&D. Rs. in Lakhs aCapital (Development & Manufacturing of Moulds) 517.99 bRecurring NIL cTotal 517.99 dTotal R&D expenditure as a percentage of total turnovers 9.14%

FOREIGN EXCHANGE EARNINGS AND OUTGO: a. Earnings Foreign exchange earnings during the year were NIL (Previous year Rs.24,01,012.00/-) b. Outgo . Foreign exchange outgo during the year was Rs.119366797.84/- (Previous year Rs. 6,76,07,267.81/-)

Your Directors confirm that: a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period; c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities; d) the directors had prepared the annual accounts on a going concern basis; and e) the directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.