DIRECTORS' REPORT

To,

The Members,

The Directors of Prime Industries Limited (PIL) have great pleasure in presenting their 23rd Annual Report of the company together with the audited statements of accounts for the financial year ended 31st March, 2015 along with report of the Statutory Auditors thereon.

2.Management Discussion & Analysis

During the year under review, your Company has registered gross operating & other income Rs. 29.57 lacs as compared to Rs. 16.02 lacs in previous year.

3. Dividend

Keeping in view the present economic situations, the board recommends retaining the earnings in the Company hence, the Board has not recommended any dividend on the equity share capital of the Company.

4. Reserves

No amount is being transferred to reserve & surplus in the current year.

5. Brief description of the Company's working during the year/State of Company's affair.

In this year of its operations, i.e. FY 2014-15, your Company posted significant increase in revenues and profits. Your company's revenue during the year under review increased to Rs. 29.57 lacs as compared to Rs. 16.02 lacs in previous year. Your company's Net Profit after tax increased to Rs. 6.66 lacs as compared to Rs. 0.74 lacs in the previous year.

6. Material changes and commitments, if any, affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report.

There are no material changes and commitments, affecting the financial position of the Company which has occurred between the end of the financial year of the Company i.e. March 31, 2015 and the date of the Directors' report i.e. August 14, 2015.

7. Significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future.

During the year under review no significant and material orders have been passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future.

8. Adequacy of Internal Control.

The Company has a proper and adequate system of internal control, to ensure that all assets are safeguarded, properly utilized and protected against loss from un-authorized use or disposition and those transactions are authorized and recorded by the concerned departments properly and reported to the Audit Committee/Board correctly.

The Company has also in place adequate internal financial controls with reference to financial statements. Such controls are tested from time to time and no reportable material weakness in the design or operation has been observed so far.

9. Subsidiary/Joint Ventures/Associate Companies.

The Company did not have any Subsidiary, Joint Ventures or Associate Companies during the year under review.

10. Deposits.

The Company has not accepted any public deposits pursuant to the the provisions of Section 73 within the meaning of Section 58A of the Companies Act, 2013 and the rules made there under and as such, no amount on account of principal or interest on Pubic Deposits was outstanding on the date of the Balance Sheet.

11. Auditors

(a) Statutory Auditors

M/s. Sukhminder Singh & Co., Chartered Accountants, hold office till the conclusion of 25th Annual General Meeting subject to annual ratification by the members at the respective AGM. The Company has received the consent from the Auditors and confirmation to the effect that they are not disqualified to be appointed as the Auditors of the Company in terms of the provisions of the Companies Act 2013 and rules made thereunder.

Accordingly, the Board of Directors has recommended the ratification of M/s. Sukhminder Singh & Co, Chartered Accountants, as the Statutory Auditors of the Company, on remuneration to be decided by the Board to the shareholders for approval.

(b) Secretarial Auditors and Secretarial Audit Report

Pursuant to Section 204 of the Companies Act 2013, your Company had appointed M/s Rajiv Bhambri & Associates, Company Secretaries in practice, Ludhiana as its Secretarial Auditors to conduct the secretarial audit of the Company for the FY 2014-15. The Company provided all assistance and facilities to the Secretarial Auditor for conducting their audit. The Report of Secretarial Auditor for the FY 2014-15 is annexed to this report.

12. Auditors' Report

No qualification, reservation or adverse remark or disclaimer made by the auditors in their respective report.

13. Extract of the annual return

As required pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of annual return in MGT 9 is annexed herewith and forms part of the Board's report.

14. Conservation of energy, technology absorption and foreign exchange earnings and outgo

Information with respect to Conservation of energy, technology, absorption, foreign exchange earnings and outgo pursuant to Section 134 of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is not applicable because there are no manufacturing activities in the Company.

15. Directors & Key Managerial Personnel

Your Company has Six (6) Directors consisting of Two (2) Independent Directors, Three (3) Non-executive Directors and (1) Managing Director (MD) as on March 31, 2015.

A) Independent and Non-Independent Non-Executive Directors

In terms of the definition of 'Independent Directors' as prescribed under Clause 49 of the Listing Agreement entered with Stock Exchanges and Section 149(6) of the Companies Act, 2013 and based on the confirmation/disclosures received from the Directors, the following Non-Executive Directors are Independent Directors:-

1. Mr. ASHWANI KUMAR

2. Mr. RAJIV KALRA

B) Statement on Declaration by Independent Director(s)

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Act and Clause 49 of the Listing Agreement with the Stock Exchanges.

C) Appointments/Resignations from the Board of Directors

i) Mrs. Parveen Singhania (DIN 00112932)

Mrs. Parveen Singhania has been appointed as an additional Director (Non-Independent /Non Executive Director) with effect from March 20, 2015 to hold office upto the date of the ensuing Annual General Meeting.

The Company has received a notice as per the provisions of Section 160(1) of the Companies Act, 2013 from a member proposing her appointment as Director. The Board of Directors recommend her appointment.

ii) Mr. Rajiv Kalra (DIN 07143336)

Mr. Rajiv kalra has been appointed as an additional Director (Independent Director) under Section 161 of the Companies Act, 2013 with effect from March 31, 2015 till the date of the ensuing Annual General Meeting.

The Company has received a notice as per the provisions of Section 160(1) of the Companies Act, 2013 from a member proposing his appointment as Director. The Board of Directors recommend his appointment.

There were no resignation of Directors during the year.

D) Directors Retiring by Rotation

In terms of Section 152 of the Companies Act, 2013, Mr. Harjeet Singh Arora shall retire at the ensuing AGM and being eligible for re-appointment, offers himself for re-appointment.

E) Remuneration to Directors/Employees and related analysis

During the year under review, no employee of the Company received salary in excess of the limits as prescribed under the Act. Accordingly, no particulars of employees are being given pursuant to Section 134 of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

The details pertaining to the ratio of the remuneration of each director to the median employee's remuneration and other prescribed details as required under section 197(12) of the Companies Act, 2013 read with rule 5(1) of the Companies (Appointment And Remuneration of Managerial Personnel) Rules, 2014 are annexed herewith and form part of the Directors' Report.

16. Number of meetings of the Board of Directors

The board meetings are convened by giving appropriate notice after obtaining the approval of the Managing Director. The Board meets at least once a quarter to review the results and other items on the agenda, once a year for on the occasion of the annual shareholders' meeting, when necessary, additional meetings are held.

The agenda of the board meetings is drafted by the Company Secretary along with the explanatory notes and these are distributed in advance to the directors. Every Board member is free to suggest the inclusion of items on the agenda. The agenda papers are prepared by the concerned officials of the respective department and are approved by the Managing Director. Agenda papers are circulated to the Board by the Company Secretary. Additional items on the agenda are permitted with the permission of the Chairman. All divisions/departments in the Company are encouraged to plan their functions well in advance, particularly with regard to matters requiring discussion/ approval/ decision in the board/ committee meetings.

All such matters are communicated to the Company Secretary in advance so that the same could be included in the agenda for the board meetings.

The Board also passes resolutions by circulation on need basis. The Company has been providing the directors with an option to participate in the board meetings through electronic mode.

Minutes of the proceedings of the board meeting are prepared within 48 hours of the meeting. Draft minutes are circulated to the Chairman for his comments. The minutes of all the Committees of the Board of Directors of the Company are placed before the Board.

The quarterly, half-yearly and the annual results are first placed before the Audit Committee of the Company and thereafter the same are placed before the Board of Directors.

Regular meetings of the Board are held to discuss and decide on various business policies, strategies and other businesses. Due to business exigencies, certain business decisions are taken by the Board through circulation from time to time.

The Board met eight (8) times during the FY 2014-15 viz. on May 30, 2014, August 14, 2014, September 22, 2014, November 14, 2014, February 12, 2015, February 14, 2015, March 20, 2015 and March 31, 2015. Detailed information on the meetings of the Board are included in the report on Corporate Governance, which forms part of this Annual Report.

17. Listing / De-listing of Shares

The Shares of your Company are presently listed on The Bombay Stock Exchange Limited, Mumbai (BSE) and the Annual Listing Fees for the year 2015-16 has already been paid to it.

18. Audit Committee

The Audit Committee comprises of namely Shri Ashwani Kumar (Chairman), Shri Harjeet Singh Arora and Shri Darshan Jit Singh Minocha as other members.

Audit Committee meetings were held five (5) times during the year on 30.05.2014, 14.08.2014, 22.09.2014, 14.11.2014 and 14.02.2015.

No recommendation of the Audit Committee has been rejected by the Board of Directors.

19. Details of establishment of vigil mechanism for directors and employees

The Company has implemented a Whistle Blower Policy pursuant to which Whistle Blowers can raise concerns relating to Reportable Matters (as defined in the policy) such as breach of Company's Code of Conduct. Further, the mechanism adopted by the Company encourages the Whistle Blower to report genuine concerns or grievances and provides for adequate safeguards against victimization of Whistle Blower who avail of such mechanism and also provides for direct access to the Chairman of the Audit Committee, in exceptional cases. The functioning of the Vigil mechanism is reviewed by the Audit Committee from time to time. None of the Whistle Blowers have been denied access to the Audit Committee of the Board. The details of the Whistle Blower Policy are explained in the Report on Corporate Governance and also available on the website of the Company and can be accessed at <http://www.primeindustrieslimited.com/PIL%20WHISTLE%20BLOWER.pdf>.

20. Familiarization programme for Independent Directors.

The Board members are provided with necessary documents/brochures, reports and internal policies to enable them to familiarise with the Company's procedures and practices. The details of such familiarization programmes for Independent Directors are posted on the website of the Company and can be accessed at <http://www.primeindustrieslimited.com/FAMILARISATION_PROGRAMME_PIL(1).pdf>.

21. Particulars of loans, guarantees or investments under section 186.

During the year under review, the company has not given any loan, guarantee, provided security to any person or other body corporate or acquired by way of subscription, purchase or otherwise, the securities of any other body corporate, exceeding the limits prescribed under section 186 of the Companies Act, 2013.

22. Particulars of contracts or 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 policy of the Company on materiality of related party transactions.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company's website at the link:<http://www.primeindustrieslimited.com/Policy%20on%20related%20party%20-PIL> pdf.

Your Directors draw attention of the members to Note 19 to the financial statement which sets out related party disclosures.

23. Nomination and Remuneration Policy.

The company's Nomination and Remuneration Policy formulated by the Nomination and Remuneration Committee deals with the appointment and remuneration of Directors and KMPs of the Company. The policy also covers the criteria for determining qualifications, positive attributes, independence of a Director and KMP. In terms of Section 134(3)(e) of Companies Act, 2013 the Nomination and Remuneration Policy of the Company is annexed herewith and forms part of the Directors' Report.

24. Insider Trading Regulations.

Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended from time to time, the Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information ("Code of Fair Disclosure") and the Code of Conduct to regulate, monitor and report trading by employees and other connected persons ("Code of Conduct") as approved by the Board on 14.05.2015 are in force by the Company. The objective of this Code is to protect the interest of shareholders at large, to prevent misuse of any price sensitive information and to prevent any insider trading activity by dealing in shares of the Company by its Directors, Designated employees and Specified Persons. The Company also adopts the concept of Trading Window Closure, to prevent its Directors, Designated employees and Specified Persons from trading in the securities of the Company at the time when there is unpublished price sensitive information.

25. Risk management policy

The Company has adopted Risk Management Policy which has been approved by the board of Directors of the Company. The aim of the Risk Management Policy is to maximize opportunities in all activities and to minimize adversity. The policy includes identifying types of risks and its assessment, risk handling and monitoring and reporting, which in the opinion of the Board may threaten the existence of the Company.

The Risk Management policy may be accessed on the Company's website at the link: <http://primeindustrieslimited.com/Risk%20management%20policy%20-%20PIL.pdf>.

26. Human Resources Development

Your Company treats its "human resources" as one of its most important assets.

Your Company continuously invest in attraction, retention and development of talent on an ongoing basis. The relations at all levels of the Company have remained very cordial throughout the year.

27. Corporate Governance Certificate

The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements set out by SEBI. Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, a separate section titled "Report on Corporate Governance" has been included in this Annual Return. The report on Corporate Governance as stipulated under the Listing Agreement forms an integral part of this Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance is attached to the report on Corporate Governance. The CEO certificate duly signed forming part of the Corporate Governance Report, has been submitted to the Board. All Board Members have also affirmed compliance to the Code of Conduct.

28. Directors' Responsibility Statement

The Directors' Responsibility Statement referred to in clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, shall state that—

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

o 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

o 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;

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

o 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.

29. Acknowledgements

Your Directors are pleased to place on record their appreciation and express their gratitude to the Company's Bankers, Clients, Advisors and Business Associates for their continued and valuable co­operation and support to the company from time to time.

Your Directors also wish to express their gratitude to investors for the faith that they continues to repose in the Company.

Your Directors would also like to place on record their appreciation for committed services rendered by the employees at all levels of your company.

For and on behalf of the Board of Directors

 (Rajinder Kumar Singnania)

Managing Director

DIN :00077540

Place:Ludhiana

Date :14.08.2015