DIRECTORS REPORT

To the Members

Your directors have pleasure in presenting the twenty-thirdannual report and the audited accounts for the year ended 31st March 2016.

FINANCIAL RESULTS Rs. in LAKHS

OPERATIONS:

The Company has posted a turnover of INR 252 crores for FY 2016, a notable decrease over the turnover of FY 2015 registered at INR 442 crores.

PERFORMANCE:

The Company has been posted a significant drop-in turnover during the year. This is on account of a shift in requirement from key defense sector customers. In order to reduce this volatility of revenue, a concerted effort has been made to develop non-defense customer. For example, new customers have been added, making network devices for the expanding 3G/4G optical networks. Rangsons has established a dedicated prototype facility with lead-free SMT line that offers design validation services to our customers. The company is focusing on the products specific to local Indian market such as set-top boxes, energy meters having good potential for growth Operating in state-of-the-art facilities, your Company has proved its credentials in Medical, Industrial, Automotive & Telecom segments and has now taken a quantum jump in aerospace and defense programs. The company has already delivered high reliability products characterized by high-mix/high-tech, flexible volume requirements. In its endeavor to offer one-stop-shop solutions and to cater to the high standards of the Aerospace & Defense markets, your Company is at the forefront, creating partnerships and bringing proven competencies from across the world in critical applications and processes which operate on an Offset-compliant model. Rangsons has designed the concept of a hub to enable its customers choose their level of engagement starting from design and development, building prototypes, mass production and to building full scale system solutions.

OUTLOOK:

The combination of Rangsons, Techno tools and product realization organization is now called Design Led Manufacturing (DLM).DLM is focused in coming year to restore both revenue&profitability to earlier levels. This will be done on the basis of a new leadership team, expanded sales team and a strong opportunity ahead.

We expect to witness a strong growth across our DLM business with traction in Israeli offset orders & Indian Telecom Orders. Along with this growth in orders from other long term customers is expected to drive growth in 2016.

RISKS & CONCERNS:

With little or no Electronic component manufacturing within the country, the complex global supply chain management is the critical aspect of the ESDM industry, that apart, significant challenges include competing with global players, handling cost pressures – shrinking operating margins on account of raw material, energy, taxes, also pose a challenge for the sector. Short product life cycle, uncertain demands coupled with stringent Service and warranty requirements, the non-availability of ready to deploy work force into the system are some of the challenges the industry is grappling with. The impact of customs duty on the raw materials inputs has its own disadvantages while raising questions of competitiveness of the finished products.

ACHIEVEMENTS:

Your Company won certain notable awards during the year, one of which was the won prestigious STPI IT Export Award 2014-15 for the 5th consecutive year. This award was presented in recognition of the best performance under the category 'Highest Growth - Electronic Hardware Exporter' operating from Tier 2 and 3 regions by Software Technology Parks of India (STPI), Govt. of India and Dept. of IT, BT and ST, Govt. of India, Bangalore.

We are proud to announce that Rangsons has won the prestigious ABB Performance Award for the 4th consecutive year. This award was presented in recognition of the best overall performance in 'Quality, On-time Delivery & Response' for PA measurement products, ABB TF, USA.

Your Company successfully participated as the key exhibitor in Defexpo India 2016, the ninth in the series of biennial Land, Naval and Internal Homeland Security Systems Exhibition

DIVIDEND:

The Company has notpaid any dividend for the year ended 31stMarch, 2016.

PUBLIC DEPOSITS:

The Company has not accepted any deposits under the Companies Act, 2013within the meaning of Chapter V of the Act 2013, for the year ended 31st March 2016.

DIRECTORS' RESPONSIBILITY STATEMENT:

In accordance with the provisions of Section 134(5) of the Companies Act, 2013, it is hereby stated that-

(a)  In the preparation of the annual accounts for the year under report, the applicable accounting standards have been followed;

(b)  The Directors have 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 profits of the Company for the period;

(c)  The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d)  The Directors have prepared the annual accounts on a going concern basis;

(e)  The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

DIRECTORS:

Appointments / Re-appointments

Pursuant to the provisions of section 152 of the Companies Act, 2013, Mr. Krishna Bodanapu and Mr.  Ajay Aggarwal retire by rotation at the ensuing Annual General Meeting (AGM) and offer themselves for re-appointment.

Pursuant to the provisions of Secretarial Standard 2 on General Meeting issued by ICSI, brief particulars of the directors who are proposed to be re-appointed are provided as an annexure to the notice convening the AGM.

Mr. Jehangir Ardeshir and Ms. Haritha Saranga was appointed as additional, Independent Director with effect from 24th June 2015 and their appointments were regularized in the 22nd Annual General Meeting which was held on 27th June, 2015.Dr. Venkatesh Padmanabhanwas appointed as Additional Director designated as Managing Director &CEO with effect from 1st October 2015.  Mr. Pavan G Ranga wasappointed as an additional director with effect from 24thSeptember 2015 Mr. Avinash Chander was appointedas additional, Independent Director with effect from 2ndFebruary 2016.The additional directors appointed during the yearwill vacate office in terms of Section 161 of the Act 2013 at the ensuing AGM.

Cessation

Mr.Naga Kishore Mittapalli, Ms.Anuradha V have resigned from the position of Directorship effective from 24th June 2015 and Mr. Arjun Ranga and Mr. Phanisha K N has resigned effective from 24th September 2015. The Board expresses its appreciation for the valuable services rendered by the said Directors and for nurturing the Company to its present level of growth.

INDEPENDENT DIRECTORS DECLARATION:

The Company has received the necessary declaration from each Independent Directors in accordance with Section 149(7) of the Companies Act, 2013, that he meets the criteria of independence as laid out in sub-section (6) of Section 149 of the Companies Act, 2013.

POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS AND SENIOR MANAGEMENT:

The Board has constituted a Nomination and Remuneration Committee in terms of Section 178 (1), who would be responsible for identifying Directors, Key Managerial Personnel, if any, their appointment, removal and fixing their remuneration, amongst others.The Remuneration Policy for Directors and other employees is annexed to this report [Annexure I].

BOARD MEETINGS:

During the year, eight(8)Meetings were convened and held on 22-April-2015, 24-June-2015, 14-July-2015, 24-September-2015, 14-October-2015, 04-November-2015, 12-January-2016, 20-January-2016.

AUDITORS:

Statutory Auditors

M/s K P Rao and Company, Chartered Accountants, Bangalore, will be re- appointing as auditors of the company who will hold office till the conclusion of the twenty fourth Annual General Meeting, subject to ratification by the members at the Annual General Meeting. The statutory auditors have confirmed their eligibility for appointment under section 139 of the Companies Act, 2013. Accordingly, requisite resolution forms part of the notice convening the AGM

Secretarial Auditors

Pursuant to Sec 204 of the Act and Rules there under, the Company appointed S. Chidambaram &Co, Practicing Company Secretaries, Hyderabad for carrying out the secretarial audit of the Company for the year 2015-16. The Secretarial Audit Report for the year 2015-16 is annexed vide Annexure II to this Report.

COMPOSITION OF AUDIT COMMITTEE:

Effective from 24th June,2015 the Company has re-constituted “Audit Committee” with following Board members:

·         Mr. Ajay Aggarwal,Non-Executive Director

·         Mr. Jehengir Ardeshir, Independent Director

·         Ms. Haritha Saranga,Independent Director

Effective from 01st February,2016 the Company has re-constituted “Audit Committee” with following Board members:

·         Mr. Jehengir Ardeshir, Independent Director

·         Ms. Haritha Saranga,Independent Director

·         Dr. Avinash Chander, Independent Director

VIGIL MECHANISM:

The Company has formulated vigil mechanism for employees including directors of the Company to report genuine concerns about unethical behavior, actual or suspected fraud and any violation of the Company's Code of Business Conduct or Ethics policy. The Policy is disclosed on the Company's website.

RISK MANAGEMENT:

The understanding as well as effective management of risks becomes very critical for sustainability of business. The company strongly believes that effective risk management can be a strategic differentiator and hence will remain focused on continuously strengthening its risk management processes.

Risk Management Framework: The Company’s risk management framework is based on (a) clear understanding and identification of various risks (b) disciplined risk assessment by evaluating the probability and impact of each risk (c) measurement and monitoring risks by establishing key risk indicators with thresholds for all critical risks and (d) adequate review mechanism to monitor and control risks.

Risk Governance Structure: The Company’s risk governance structure facilities and strengthens risk evaluation and management. The board oversees the risk management process and monitors the risk profile of the company. The Company’s risk management initiatives and risk MIS are reviewed monthly by the CEO and business heads.

The key risks faced by the company are broadly classified under market risk, operational risk and regulatory risk that include but not limited to Shrinking Operating Margins, Complex global supply chain, Service and Warranty management, Short product life cycles, uncertain demands and Sustainability.

INTERNAL FINANCIAL CONTROL:

The Company has an established internal financial control framework including internal controls over financial reporting and operating controls. The framework is reviewed regularly by the management and tested by internal audit team and presented to the board. Based on the periodical testing, the framework is strengthened, from time to time, to ensure adequacy and effectiveness of Internal Financial Controls.

CORPORATE SOCIAL RESPONSIBILITY POLICY:

The Company has remodeled its CSR policy in keeping with objectives of the parent company Cyient Ltd; the Policy is hosted on the Company’s website www.rangsons.com, and expects to embark on several CSR initiatives going forward. The annual report and details of the CSR policy are annexed at Annexure III and form a part of this report.

SUBSIDIARY:

Techno Tools Precision Engineering Private Limited is a wholly owned subsidiary company as on 31stMarch, 2016. We have, in accordance with Section 129(3) of the Companies Act, 2013 prepared consolidated financial statements of the Company and its subsidiary, which form part of the Annual Report. Further, the report on the performance and financial position of each of the subsidiary and salient features of the financial statements in the prescribed Form AOC-1 is annexed to this report [Annexure IV]

During the year no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company’s operations in future

DISCLOSURES:

Information of Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

a)    Conservation of Energy:

During the year under review, the Company embarked on certain measures to effectively achieved a reduction in the power load to an extent of 23kwh through:

·           Installation of   170   LED bulbs in the facility.

·           Installation of   250 electronic chokes in place of copper chokes, also to eliminate the risk of fire accidents.

·           Installation of   Solar light in place of CFL.

·           Making Usage of storage tank & pressurized switch pump motor in place of vacuum pump motor that also has enhanced the performance of motors.

·           Installation of LED focus light at parking area in place of halogen.

·         Entered an agreement with ‘’ SURYAJYOTHI ENERGY PRIVATE LIMITED’’ topurchase Solar Power as per the terms and conditions mutually agreed. It will reduce total electricity consumption by utilizing the solar energy.

b)    Technology Absorption

Vapor Phase Soldering Technology Deployment-This capability is a key differentiator for us in the Aerospace/ Defencesegment. TheCompany is introducing to its process the state of the art vapor phase soldering technology to provide sophisticated process solutions to our aero-defense customers. The use of liquid or vapor as a means to transfer energy is far more effective. The vapor condenses on the solder product; the condensate encapsulates it completely, and thus transmits the energy. The entire pre-heating and soldering process takes place in an oxygen-free environment. The variable temperature gradient control automatically provides the required vapor quantity corresponding to the heat requirement of the component. Thus the optimum temperature at all positions of the component is guaranteed. Any components with any thermal requirements can be soldered without restrictions. The patented feature - Dynamic Profiling process helps an easy and fast creation of temperature profiles. At the same time Dynamic Profiling guarantees absolute process safety in series production. Product overheating, component damage or PCB delamination cannot occur as the maximum temperature is physically limited by the boiling point of the heat transfer fluid Galden.

The new capability has given unique positioning to the Company on the process capabilities. The Company expects to accomplish more programs that require these advanced soldering capabilities in aero-defense and medical segments.

c)    Foreign Exchange Earnings and Outgo

Company has earned Foreign Exchange of INR 7511.6 lakhs [Previous year INR 39,272.04 lakhs] and Foreign Exchange outgo is   INR 19,934 lakhs [Previous year INR 28,457.93 lakhs]

Particulars of Related Party Transactions

Details of material related party transactions under Section 188 of the Act 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014, are given in Annexure V to this report in the prescribed form.

Annual Return

Extract of Annual Return in the prescribed form is given as Annexure VI to this report, in terms of the requirement of Section 134(3)(a) of Act read with the Companies (Accounts) Rules, 2014.

Particulars of Loans, Guarantees or Investments made

The Company has given advance of Rs.10.65(including previous advances) Crore to its wholly owned subsidiary Techno Tools Precision Engineering Private Limited which is within the limits laid down under section 186 (2) of the Companies Act, 2013. There are no other loans, guarantees or investments made in terms of section 186 of Companies act, 2013.

EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND THE PRACTICING COMPANY SECRETARY IN THEIR REPORTS.

Auditors:

Explanation to the Clause 3 ( C ) to the Annexure to the Independent Audit Report for schedule of, repayment of principal, and payment of interest, in respect of a loan of Rs 8,12,22,100 /- to M/s. Techno Tools Precision Engineering Private Limited, wholly owned subsidiary company, board shall  ensure repayment schedule for the above said loan by end of December, 2016.

Other Laws

During the year under review, there were no cases filed pursuant to the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act 2013.

ACKNOWLEDGEMENT

The directors thank the customers, financial institution/banks, and the Government for their understanding, co-operation and assistance extended to the company. The directors also wish to place on record their special appreciation to employees for their efforts, dedication and commitment in enabling the Company to scale newer heights.

For and on Behalf of the Board

Sd/-                                                                                              Sd/-                                                           

Dr.Venkatesh Padmanabhan                                Ajay Aggarwal                                                

Managing Director &CEO   Director

DIN:06528470                        DIN:02565242

Date: 28thApril 2016.
Place: Bangalore

ANNEXURE I

NOMINATION & REMUNERATION POLICY

Board re-constituted a “Nomination & Remuneration Committee” with following Members effective from 24thJune, 2015;

a.     Mr. Krishna Bodanapu, Director

b.    Mr. Jehangir Ardeshir, Independent Director

c.     M/s. Haritha Saranga,Independent Director

The terms of reference of the Remuneration Committee includes roles, responsibilities and powers as set forth:

1.     To identify persons, who are qualified to be Directors;

2.      To recommend to Board their appointment and removal and shall carry out evaluation of every Director’s performance;

3.     To formulate the criteria for determining qualifications, positive attributes and independence of Director;

4.     To recommend to the Board a policy relating to remuneration for the Directors, Key Managerial Personnel and other employees;

5.     Any other responsibilities as may be assigned by the Board from time to time.

The powers so conferred shall remain intact unless and until modified or altered or amended further by way of a resolution passed by the Board of Directors of the Company.

REMUNERATION POLICY

Levels of remuneration are determined such that they attract, retain and motivate directors of the quality required to run the company successfully. All board level compensation is approved by the shareholders and disclosed separately in the financial statements. The annual compensation of the executive directors is approved by the board within the overall limits set by the shareholders at their meetings.

Consistent with globally accepted governance practices, the company has ushered in flexibility in respect of payment of remuneration to Independent Directors. The remuneration payable to Independent Directors is linked to their attendance at the meetings of the Board or committees thereof, their contributions at the meetings or otherwise, and on their position in various Committees of the board, whether as that of Chairman or Member. The board approves the commission paid to directors individually, based on the recommendations of the Nomination and Remuneration committee.

The company pays remuneration by way of salary, perquisites and allowances to the Managing Director & CEO as approved by the shareholders of the company.

ANNEXURE II

SECRETARIAL AUDIT REPORT

FOR THE FINANCIAL YEAR ENDED 31.03.2016[pursuant section 204(1) of the Companies Act, 2013 and rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]

SECRETARIAL AUDIT REPORT

FOR THE FANCIAL YEAR ENDED 31ST MARCH, 2016

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

To,

The Members,

RANGSONS ELECTRONICS PRIVATE LIMITED,

(CIN: U31909KA1993PTC014470)

347, D1&2, KIADB ELECTRONIC,

CITY HEBBAL, INDUS, MYSORE,

MYSORE – 570016.

I have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by Rangsons Electronics Private Limited. Secretarial Audit was conducted in a manner that provided me a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing my opinion thereon.

Based on my verification of the Company’s books, papers, minute books, forms and returns filed and other records maintained by the company and also the information provided and declarations made by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, I hereby report that in my opinion, the company has, during the audit period covering the financial year ended on 31st March, 2016 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:

I have examined the books, papers, minute books, forms and returns filed and other records maintained by “the Company” for the financial year ended on 31st March, 2016 according to the provisions of:

   (i)        The Companies Act, 2013 (the Act) and the rules made thereunder;

  (ii)        The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;

 (iii)        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;

 (iv)                    The Karnataka Shops and Commercial Establishments Act, 1961;

  (v)        Employees’ State Insurance Act, 1948 and Employees’ State Insurance (General) Regulations, 1950;

 (vi)        The Employees? Provident Funds and Miscellaneous Provisions Act, 1952 and The Employees’ Provident Funds Scheme, 1952;

(vii)        The Payment of Bonus Act, 1965 and the Payment of Bonus Rules, 1965;

(viii)        The Contract Labour (Regulation and Abolition) Act, 1970 and the Contract Labour (Regulation and Abolition) Central Rules, 1971;

 (ix)        Income Tax Act, 1961 and rules made thereunder;

  (x)        Service Tax Act, 1994 and rules made thereunder;

 (xi)        The Information and Technologies Act, 2000.

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

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

The Following Acts, Rules and Regulations, Guidelines are not applicable to the Company during the Audit Period:

    (i)        The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made thereunder;

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

(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;

(e)   The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008;

(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; and

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

 (iii)        The Listing Agreements entered into by the Company with BSE Limited;

During the period under review the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards, etc.

I further report that subject to my observations, The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-Executive Directors and Independent Directors. The changes in the composition of the Board of Directors that 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 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.

Majority decision is carried through and no members has dissented any of the Resolutions.

I further report that 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.

The Company was required to appoint Two Independent Directors on its Board as per Section 149(4) and rule 4 of Companies (Appointment & Qualification of Directors) Rules, 2014 on its subsidiary of Cyient Limited, a Public Limited Company with effect from 4th February, 2015. However, the company has appointed the Two Independent Director in the Board Meeting Held on 24.06.2015 upto which the Company has only One Independent Director.

The Board of Directors were also constituted as per clause 6.1 of Part B of the Articles of Association (AOA) at the end of the Financial Year 31.03.2016. But, During the Year the Managing Director was appointed on 01.10.2015 in compliance of AOA, but upto 01.10.2015 the Company do not have the Managing Director in the Company.

The Company has delayed in filing the Forms with the Ministry of Corporate Affairs, but all the forms were filed with the Limits prescribed under section 403 of the Companies Act, 2013 by paying the Additional Fee as required under the Act.

Place: Hyderabad                      Signature:

Date:28/04/2016                                                                        Sd/-

S. Chidambaram                                                                                        

Practicing Company Secretary:

FCS No. 3935

C P No: 2286

To

The Members of

RANGSONS ELECTRONICS PRIVATE LIMITED

Mysore.

My Secretarial Audit Report of even date is to be read along with this letter.

1      The maintenance of Secretarial records is the responsibility of the Management of the Company. Further, the Company is also responsible for devising proper systems and process to ensure the compliance of the various statutory requirements and Governance systems.

2      It is the responsibility of the Management of the Company to ensure that the systems and process devised for operating effectively and efficiently.

3      My responsibility is to express an opinion on these secretarial records based on my audit.

4      I have followed the audit practices and process as were appropriate to obtain reasonable assurance about the correctness of the contents of the Secretarial records. The verification was done on test basis to ensure that correct facts are reflected in Secretarial records. I believe that the process and practices followed provide a reasonable basis for my opinion.

5      Wherever required, I have obtained the Management representations about the compliance of laws, rules and regulations and happening of events etc.

6      The Compliance of the provisions of other applicable laws, rules and regulations is the responsibility of the management. My examination was limited to the verification of procedure on test basis.

7      The secretarial Audit report is neither an assurance as to the future viability of the Company nor of the efficacy or effectiveness with which the Management has conducted the affairs of the Company.

Place: Hyderabad                                                          Signature:

Date: 28/04/2016                                                                       Sd/-     

S. Chidambaram                                                                                        

Practicing Company Secretary:

FCS No. 3935

C P No: 2286

ANNEXURE III

Annual Report on Corporate Social Responsibility (CSR) activities

1.    A brief outline of the company’s CSR policy:

The Company believes in the philosophy of returning to society as a measure of gratitude for what it has taken from it. In view of this, the company’s corporate social responsibility (CSR) aims to extend beyond charity and enhance social impact.

The company’s CSR mission:

Achieving long-term, holistic development of community around us by being committed to creating and supporting programmes that bring about sustainable changes through education and health care systems.

The company’s CSR vision:

·         To help underprivileged children to access the quality of education and

·         To participate in projects with business aligned innovation

2.    Web link to the CSR policy:http://www.rangsons.com/company-policies.aspx

3.    The Board re-constituted a “CSR Committee” with following Members effective from 24th June, 2015;

·         Krishna Bodanapu, Director

·         Jehangir Ardeshir, Independent Director

·         Ajay Aggarwal, Director

The Board re-constituted a “CSR Committee” with following Members effective from 01st October, 2015.

·         Krishna Bodanapu, Director

·         Jehangir Ardeshir, Independent Director

·         Ajay Aggarwal, Director

·         Venkatesh Padmanabhan

4.    Average net profit of the company for last three financial years:INR /-1,378,065,862/-

5.    Prescribed CSR Expenditure         :          INR 2,756,132/-

(2% of the amount as in item 4 above)

6.    Details of CSR spend through proposed activity during the financial year:

a)    Total amount spent for the financial year        : 300,000 /-

b)    Amount unspent, if any                                    : INR 24.56 Lakhs/-

c)    Manner in which the amount spent during the financial year:Spending of INR 3 lakhs on the blind mens rally.

7.    In case the company has failed to spend the two per cent of the average net profit of the last three financial years or any part thereof, reasons for not spending the amount:

Company is revising its CSR policy in line with the CSR Policy of its Parent Company. The remaining amount shall be spent in the subsequent years.

8.    A responsibility statement of the CSR committee that the implementation and monitoring of CSR Policy, is in compliance with CSR objectives and Policy of the company:

The CSR committee confirms that the implementation and monitoring of the CSR Policy is in compliance with the CSR objectives and Policy of the company.

28/04/2016

 Mysore

                     Sd/-                                                        Sd/-                                                                                  Jehangir Ardeshir

           Chairman of CSR Committee                                                                       Director

ANNEXURE IV

FORM AOC - 1

ANNEXURE V

Form No. AOC-2

(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014)

Form for disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in sub-section (1) of section 188 of Companies Act, 2013 including certain arm’s length transactions under third proviso thereto

1. Details of contracts or arrangements or transactions not at arm’s length basis: NIL

       The company has not entered into any contract or arrangement or transaction with its related parties which is not at         

        arm’s length during financial year 2015-16.

2. Details of material contracts or arrangement or transactions at arm’s length basis:

ANNEXURE VI

EXTRACTOFANNUALRETURN

FormNo.MGT-9

asonthefinancialyearendedon 31st March, 2015

[Pursuanttosection92(3)oftheCompaniesAct,2013andrule12(1)oftheCompanies(ManagementandAdministration)Rules,2014]

I.      REGISTRATIONANDOTHERDETAILS:

II.    PRINCIPALBUSINESSACTIVITIESOFTHECOMPANY:

Allthebusinessactivitiescontributing10%ormoreofthetotal turnoverofthecompany:

III.   PARTICULARSOFHOLDING,SUBSIDIARYANDASSOCIATE COMPANIES

IV.  SHARE HOLDING PATTERN: (Equity Share Capital Breakup as percentage of Total Equity)

a.    Category- wise share holding

b.    Shareholding of Promoter

c.    Shareholding Pattern of Top Ten Shareholders                                   : Nil

       (other than Directors, Promoters and Holders of GDRs and ADRs)

d.    Shareholding of Directors and Key Managerial Personnel:

V.    INDEBTEDNESS:

Indebtedness of the Company including interest outstanding/accrued but not due for payment

VI.      REMUNERATIONOFDIRECTORSANDKEYMANAGERIAL PERSONNEL:

A.   Remuneration to Managing Director, Whole-time Directors and/or Manager

B.   Remuneration to other Directors

C.   Remuneration to Key Managerial Personnel other than MD/ Manager/ WTD:

VII.     PENALTIES/PUNISHMENT/COMPOUNDINGOFOFFENCES:There was no Penalties/Punishment/Compounding of offences for the year ended 31st March 2016.

 [M1]Please correct it to 2,92,26,386 and change respective total columns

OPERATIONS:

The Company has posted a turnover of INR 252 crores for FY 2016, a notable decrease over the turnover of FY 2015 registered at INR 442 crores.

PERFORMANCE:

The Company has been posted a significant drop-in turnover during the year. This is on account of a shift in requirement from key defense sector customers. In order to reduce this volatility of revenue, a concerted effort has been made to develop non-defense customer. For example, new customers have been added, making network devices for the expanding 3G/4G optical networks. Rangsons has established a dedicated prototype facility with lead-free SMT line that offers design validation services to our customers. The company is focusing on the products specific to local Indian market such as set-top boxes, energy meters having good potential for growth Operating in state-of-the-art facilities, your Company has proved its credentials in Medical, Industrial, Automotive & Telecom segments and has now taken a quantum jump in aerospace and defense programs. The company has already delivered high reliability products characterized by high-mix/high-tech, flexible volume requirements. In its endeavor to offer one-stop-shop solutions and to cater to the high standards of the Aerospace & Defense markets, your Company is at the forefront, creating partnerships and bringing proven competencies from across the world in critical applications and processes which operate on an Offset-compliant model. Rangsons has designed the concept of a hub to enable its customers choose their level of engagement starting from design and development, building prototypes, mass production and to building full scale system solutions.

OUTLOOK:

The combination of Rangsons, Techno tools and product realization organization is now called Design Led Manufacturing (DLM).DLM is focused in coming year to restore both revenue&profitability to earlier levels. This will be done on the basis of a new leadership team, expanded sales team and a strong opportunity ahead.We expect to witness a strong growth across our DLM business with traction in Israeli offset orders & Indian Telecom Orders. Along with this growth in orders from other long term customers is expected to drive growth in 2016.

a)    Conservation of Energy:

During the year under review, the Company embarked on certain measures to effectively achieved a reduction in the power load to an extent of 23kwh through:

·           Installation of   170   LED bulbs in the facility.

·           Installation of   250 electronic chokes in place of copper chokes, also to eliminate the risk of fire accidents.

·           Installation of   Solar light in place of CFL.

·           Making Usage of storage tank & pressurized switch pump motor in place of vacuum pump motor that also has enhanced the performance of motors.

·           Installation of LED focus light at parking area in place of halogen.

·         Entered an agreement with ‘’ SURYAJYOTHI ENERGY PRIVATE LIMITED’’ topurchase Solar Power as per the terms and conditions mutually agreed. It will reduce total electricity consumption by utilizing the solar energy.

a)    Technology Absorption

Vapor Phase Soldering Technology Deployment-This capability is a key differentiator for us in the Aerospace/ Defencesegment. TheCompany is introducing to its process the state of the art vapor phase soldering technology to provide sophisticated process solutions to our aero-defense customers. The use of liquid or vapor as a means to transfer energy is far more effective. The vapor condenses on the solder product; the condensate encapsulates it completely, and thus transmits the energy. The entire pre-heating and soldering process takes place in an oxygen-free environment. The variable temperature gradient control automatically provides the required vapor quantity corresponding to the heat requirement of the component. Thus the optimum temperature at all positions of the component is guaranteed. Any components with any thermal requirements can be soldered without restrictions. The patented feature - Dynamic Profiling process helps an easy and fast creation of temperature profiles. At the same time Dynamic Profiling guarantees absolute process safety in series production. Product overheating, component damage or PCB delamination cannot occur as the maximum temperature is physically limited by the boiling point of the heat transfer fluid Galden.

The new capability has given unique positioning to the Company on the process capabilities. The Company expects to accomplish more programs that require these advanced soldering capabilities in aero-defense and medical segments.

a)    Foreign Exchange Earnings and Outgo

Company has earned Foreign Exchange of INR 7511.6 lakhs [Previous year INR 39,272.04 lakhs] and Foreign Exchange outgo is   INR 19,934 lakhs [Previous year INR 28,457.93 lakhs]

DIRECTORS' RESPONSIBILITY STATEMENT:

In accordance with the provisions of Section 134(5) of the Companies Act, 2013, it is hereby stated that-

(a)  In the preparation of the annual accounts for the year under report, the applicable accounting standards have been followed;

(b)  The Directors have 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 profits of the Company for the period;

(c)  The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d)  The Directors have prepared the annual accounts on a going concern basis;

(e)  The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.