ANG Industries Ltd Directors Report

To

The Members,

ANG Industries Limited

Your Directors are pleased to present the 26th Annual Report of your Company together with the Audited Statement of Accounts and the Auditors Report of your Company for the financial year ended 31st March, 2017. The summarized financial results for the year ended 31st March, 2017 are as under:

Financial Results

Particular	For the financial year ended 31st March, 2017 Amount in Rs.	For the financial year ended, 31st March, 2016 Amount in Rs.
Gross Sales	8931.43	16464.63
Other Income	283.79	54.40
Total Income	9215.22	16519.03
Profit / (Loss) Before Tax and depreciation	(10072.59)	(297.18)
(-) Depreciation	965.62	742.83
Provision for Tax	-	-
Deferred Income Tax	287.72	2.21
Profit / (Loss) after Tax	(10750.50)	(1037.80)

Review of Operation

The revenue of the current years has decreased from Rs. 16519.03 Lacs to Rs. 9215.22 Lacs due to cancellation of orders by overseas buyers and BHEL. The company had suffered huge losses in terms of inventories, which was made on specific orders for various customers. During the last year, the company could not deliver the supply of goods in time due to closure of factory by the order of Hon.ble National Green Tribunal (NGT) and in the year under report, the customers levied heavy penalty for air freight, line down charges and late delivery. Due to these reasons, the orders were cancelled by the Customers and the company suffered huge losses in the year under report.

Dividend

Company suffered loss due to which no dividend was declared by your Directors for the financial year 2016-17.

Directors

The Board of Directors consists of Executive and Non-Executive directors including Independent directors who have wide and varied experience in different disciplines of Corporate functioning.

Mr. O.P. Sharma, Whole Time Director is liable to retire by rotation at the ensuing Annual General Meeting of the Company and being eligible, offers himself for re-appointment. Your Director recommend for his re-appointment.

Mr. Manoj Gupta has submitted his resignation due to his health and personal problems. The resignation was accepted by the Board of Directors of the Company in their meeting held on May 26, 2017. The independent Directors have confirmed and declared that they are not disqualified to act as an Independent Director in compliance with the provisions of Section 149 of the Companies Act, 2013 and the Board is also of the opinion that the Independent Director fulfil all the conditions specified in the Companies Act, 2013 making them eligible to act as Independent Director.

Pursuant to the provision of section 203 of the Act, the key managerial personnel of the Company are Mr. Premjit Singh, Managing Director and chief Executive Officer, Mr. Naveen Gupta, Chief Financial Officer and Ms. Seema Mathur, Company Secretary of the Company.

Corporate Governance

Your Company has fully complied with the requirements and I

disclosures that have to be made under code of Corporate :

Governance as required under clause 49 of the Listing agreement :

entered into with the National Stock Exchange of India Limited (NSE) and Bombay Stock Exchange Limited (BSE).

Being a listed Company necessary measures are taken to comply with the Listing Agreements with the Stock Exchanges. A report on Corporate Governance, along with a Certificate of Compliance from the Statutory Auditors, forms part of this.

Consolidated Financial Statements

In compliance with the applicable clauses of Listing Agreement with the stock Exchanges, the Company has prepared consolidated financial statements as per the Accounting Standard on Consolidated Financial Statements (AS 21) issued by the Institute of Chartered Accountants of India. The Audited Consolidated Financial Statements along with the Auditors Report thereon have been annexed to this Annual Report.

Management Discussion and Analysis

The Management Discussion and Analysis is presented in a separate section, which forms part of the Annual Report.

Directors Responsibility Statement

Pursuant to Section 134(5) of the Companies Act, 2013 the Board of Directors of the Company confirms that-

1. In preparation of the Annual Accounts, the applicable accounting standards have been followed.

2. 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 or loss of the company for that period.

3. 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.

4. The Directors had prepared the Annual Accounts on a going concern basis.

5. They have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively.

6. 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.

Disclosures under Section 134(3)(L) of the Companies Act. 2013 Impact BS III Vs BS IV on ANG

In view of implementation of Stage BS IV as per the order of Hon.ble Supreme Court of India, no BS III vehicles will be sold in India from 1 April. 2017 as the Hon.ble Supreme Court banning the sales and registration of BS III vehicles. So India is all set to move to a BS IV future and it seems that the auto manufacturers will have to pay the price, as there are over 8.2 lakh BS III vehicles still lying unsold in the country.

This has an impact on the business of ANG, as the vehicle production at our customers end i.e. Ashok Leyland Limited has suffered a lot. This has been implemented on March 27, 2017, in view of vehicles produced in BS III compliance could not be rolled out. This has impacted us a huge as the tippers bodies which were to be mounted on the vehicle during the month of March could not be mounted or sold and the turnover of ANG reduced in the last quarter of 2016- 17.

Notwithstanding this, the resulting in huge vehicle inventories of BS III compliance vehicle manufactured by Ashok Leyland Limited to produce less vehicle in April 2017 and May 2017 and the vehicles of stock are to be retrofitted with BS IV compliant. This exercise will continue till July 2017and which have impact of supply of tipper bodies by ANG. The sale / manufacturing of Tippers by ANG may have impact of 60-70% less of tipper due to the reasons mentioned above. It is expected that the exercise of retrofitted with BS IV Compliant with all the old BS -III compliance vehicle will be completed in August 2017.

Transfer to Reserves in terms of Section 134(3Hi) of the Companies Act. 2013

For the financial year ended 31st March, 2017, the Company had not transferred any sum to its Reserves as it suffered loss during the year.

Transfer to the Investor Education and Protection Fund

In terms of Section 125 of the Companies Act, 2013, no unclaimed dividend in relation to any financial year is due for remittance to the Investor Education and Protection Fund established by the Central Government.

Particulars of Employees

There is no employee in the Company whose particulars are required to be given under the provisions of section 197(12) of the Companies Act, 2013 read with the (Particulars of Employees) Rules, 1975, as amended.

Statutory Auditors

Comments of the Auditors in their report and the notes forming part of the Accounts, are self explanatory and need no comments. Appointment of Statutory Auditors : As per the provisions of the Companies Act, 2013, M/s Sandesh Jain & Co. Chartered Accountants, hold office as Statutory Auditors of your Company till the conclusion of the 26th Annual General Meeting. M/s. Sandesh Jain & Co., Chartered Accountants has shown its unwillingness for the reappointment as a Statutory Auditors of the Company. The Audit

Committee and the Board of Directors in their respective meetings held on 10th June, 2017 have recommended for the appointment of M/s Gupta Jallan & Associates (Registration Number 003721N registered with the Institute of Chartered Accountants of India) KD - 94, Vishakha Enclave, Pitam Pura, Delhi 110 034 as Statutory Auditors of the Company in place of M/s Sandesh Jain & Co., Chartered Accountants retiring Auditors of the Company. M/s. Gupta Jallan & Associates, Chartered Accountants, Delhi, if appointed in the Annual General Meeting will be holding office of Statutory Auditors from the conclusion of this meeting until the conclusion of the ensuing Annual General Meeting. M/s. Gupta Jallan & Associates, Chartered Accountants, Delhi, have conveyed their consent to be appointed as the Statutory Auditors of the Company along with confirmation that, their appointment, if approved by the shareholders, would be within the limits prescribed under the Act. You are requested to appoint them as Statutory Auditors from the conclusion of this Annual General Meeting upto the conclusion of 27th Annual General Meeting.

Auditors Report

The report of Statutory Auditors contains the following observation on the financial statement:

1. The financial results shows that the company had made the provisions of NIL in their books of account for payment of premium to LIC on account of group gratuity cash accumulation plan during the financial year 2016-17. As the company had not paid the premium even in this year to LIC. Further, the company has not obtained the actuary valuation from independent actuary for the current year.

Management View :

The Company has paid gratuity to the outgoing employees amounting to Rs. 40,25,16V- during the year due to paucity of fund and mismatch in cash flow and the requisite amount in LIC Fund could not be deposited and similarly the actuary valuation has also not done.

2. The Company has not provided interest amounting to Rs.678.22 Lacs accrued and payable by the company on the loans availed from State Bank of India and Bank of Baroda. All the said loans have been termed as NPA W.e.f. 30.06.2016 and the Banks have stopped charging interest in the regular accounts of the company. Profit has been understated to the extent interest not booked by the Company. Loan has been increased by the amount of export bills crystalized by the banks.

Management View :

The Company has not provided for the interest as the banks have stopped charging the interest in the regular account of the company in their books.

3. During the year major inventories items have been classified as obsolete and has been classified as scrap by the Company. Out of the same major portion has been sold out during the year. However, it is not possible to quantify the impact of losses due to this.

Management View :

The company has suffered losses due to reduction in the valuation and generation of excessive scrap due to cancellation of orders of various components like Diff. Spiders, Worm and Gear, Diff. Pins, Automatic Slack Adjusters, Log Splitter parts, etc. from various overseas customers and Heavy Steel Fabrication for Bharat Heavy Electrical Limited.

4. In our opinion, there are many operations which have been either closed down or production have been suspended. The

hundred percent of exports orders have been cancelled. The majority of the Banks have declared the companys account as NPA. The sources of additional funds coming to the company are unforeseeable. This is an audit requirement for a qualification as going concern concept.

Management View :

The company is making all efforts to revive its operations of the suspended production units for which it has already submitted a detailed restructure plan to the Joint Lender Forum of the Banks and which is under consideration.

Internal Auditors

The Company has a proper Internal Control system commensurate with the size, scale and complexity of its operation. To maintain the objectivity and independence, the internal audit team reports to the Chairman of the Audit Committee of the Board. Mr. Suneel Siwal having Membership Number 527218 has been appointed as the internal auditor of the Company w.e.f. 1st April, 2016.

Disclosure of Board Report as per Secretarial Standards

The Company has appointed M/s R P Agarwal & Associates (CP No.8668), , Practicing Company Secretaries, F-23,/56, Sector 3, Rohini, Delhi - 110 085 to hold the office of Secretarial Auditors and to conduct the Secretarial Audit and the Secretarial Audit Report for the Financial Year ended 31st March, 2017 is being attached with the Directors Report as Annexure-B which is self explanatory and needs no comments.

Extract of Annual Return Section 92(3) of Companies Act. 2013

Ihe Extracts of the Annual Return for the year 2016-17 being attached with the Directors Report as Annexure -C.

Number of Board Meetings Section 173(1) of Companies Act. 2013:

During the financial year 2016-17, 14 Board Meetings were held. The date of Board Meeting were as follows:

18th April, 2016, 13th May, 2016, 27th May, 2016, 7th July, 2016, 12th August, 2016, 25th August 2015, 3rd October 2016, 1st December, 2016, 15th December, 2016, 16th January, 2017, 9th January, 2016, 14th February, 2017, 16th March, 2017, 21st March, 2017.

Declaration bv Independent Director

The Independent directors have submitted their disclosure to the Board that they fulfil all the requirements to qualify for their appointment as an independent Director under the provisions of the Companies Act, 2013 as well as clause 49 of the Listing Agreement.

Board Evaluation

The Board of Directors has carried out an annual evaluation of its own performance, board committee and individual directors pursuant to the provisions of the Act and the Corporate Governance requirements as prescribed by Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The performance of committee was evaluated by the board after seeking inputs from all the directors on the basis of the criteria such as the board composition and structure, effectiveness of board processes, information and functioning etc.

The Board subsequently evaluated its own performance, the working of its Committees (Audit, Nomination and Remuneration and Stakeholders Relationship Committee) and independent Directors (without participation of the relevant Director).

The criteria for performance evaluation have been detailed in the Corporate Governance Report attached to this report.

Related Party Transactions:

The company has not entered into transaction with a related party for availing job work services/ sales during the year under report. If Company do any transaction with them , the party is covered under the definition of related party as per Listing Agreement and required approval has been given by the Shareholders in the 25th Annual General Meeting of the Company. The transactions will be entered into with the related party at arms Length basis and will in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

Conservation of Energy. Technology Absorption and Foreign Exchange Earnings and Outgo

The particulars as required under the provisions of Section 134 of the Companies Act, 2013 in respect of conservation of energy and I

technology absorption have been furnished considering the nature 1

of activities undertaken by the company during the year under review.

i

Risk Management Policy

Pursuant to the provision of Section 134(3)(n) of the Companies i

Act, 2013 and Clause 49 of the Listing Agreement, the Company has constituted a business risk management committee. To address :

these business risks in a comprehensive manner, each risk is mapped to the concerned department for further action. Based on this framework, the Company has set in place procedures to periodically place before the board the risk assessment and minimization procedures being followed by the Company.

Nomination/Remuneration Committee I

The Nomination and Remuneration has been constituted with (Three) Non-Executive Directors. During the year one meeting has I

been held. The key area of Committee has been detailed in Corporate Governance Report. I

Public Deposits i

During 2016-17, your Company did not invite or accept any deposits within the meaning of Section 76 of the Companies Act, 2013 and the rules made there under. !

Personnel

None of the employees of the Company were in receipt of the prescribed remuneration and as such, the list of employees as required under Section 197 (12) of the Companies Act, 2013 is not enclosed.

The Managements relationship with employees was cordial during the year under review.

Acknowledgements

Your Directors place on record their sincere gratitude for the continuing support of Shareholders, bankers and Business associates at all levels.

For and on behalf of the Board

 

Nidhi Singh

 

Premjit Singh

(DIN No. 00332949)

Date: 10,h June, 2017

Place: New Delhi

ANNEXURE TO DIRECTORS REPORT

Information under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 2014 and forming part of the Directors Report for the year ended 31st March, 2017.

A. Conservation of energy

The Company has created high degree of awareness on conservation and saving of energy among the workers, employees including top management of the Company. Constant efforts are being made by your Company to reduce energy consumption, upgrade technology and equipment, and derive optimum benefits from the present sources. The Company is continuously identifying the scope for improving end-use efficiency by evaluating the techno-economic viabilityof various energy conservation measures. The Company is primarily focusing on:

a) Technology upgradation

b) CFL and LEDs have been installed in Machine shops to conserve energy.

c) Providing limit switches

d) Process optimisation to enhance production

e) Training employees towards energy conservation

The Companys captive power generation increased. The comparative statement of energy generation, as compared with last year, is given hereunder:

Particulars	2016-17	2015-16
Electricity units(MKWH)	60,30,330	41,15,850
Total amount	148,40,071	432,95,486
Average rate/ unit(Rs. KWH)	2.61	10.19
Own generation
Through diesel generator
Units (M.KWH)	110,906	6,96,037
Units per litre of diesel (KWH)	6.76	3.01
Average cost / unit (Rs. KWH)	20.29	17.92

A. Technology absorption

The technology adopted by your Company is upgraded on a regular basis. In-house training is imparted regularly to plant personnel for adopting technology advancements and cost containment. Further, your Company follows better engineering practices, which include reverse engineering processes for enhancing productivity, product improvement, cost reduction, better quality and stability of products.

B. Foreign exchange earnings and outgo

Activities under this head include those relating to exports and initiatives undertaken to increase exports; development of new

export markets for products and services and export plans. The Company exported its product to the buyers based in the United States of America (USA) and Brazil, among others.

The export earnings of your Company for 2016-17 was USD 309397 and Euro Nil (Equivalent to Rs. 209.55 Lacs) on account of exports, interest received on fixed Deposits in foreign exchange, Company received advance of USD428800 (Equivalent to Rs 420.47 Lacs) and the foreign exchange outgo was USD Nil, and Euro 4704.43 (Equivalent to Rs.2.37 Lacs) on account of Import of raw material (Equivalent to Rs. 135.50 Lacs) USD 217968, SGD 30430 for foreign tour and travelling.