Directors Report of Lakshmi Mills Company Ltd.

Mar 31, 2025

Your Directors have pleasure in presenting the Hundred and Fifteenth Year Annual Report together with the
audited accounts of the Company for the year ended 31^st March 2025.

financial summary / highlights

	31.03.2025	31.03.2024
No. of days worked	356	357
	('' in Lakhs)
Revenue from operations	26,316.27	25,296.90
Other income	637.23	804.14
Gross Revenue	26,953.50	26,101.04
Profit / (Loss) before Tax and Exceptional Items	(740.45)	(2,189.93)
Exceptional items	21.54	169.06
Profit / (Loss) before Taxation	(718.91)	(2,020.87)
Tax Expense	(251.38)	(641.58)
Profit / (Loss) after Taxation	(467.53)	(1,379.29)

operations

The Company’s Gross Revenue increased by 3.27% from '' 26,101.04 Lakhs in 2023-24 to '' 26,953.50 Lakhs
in 2024-25 and the Net Loss after Tax for financial year 2024-25 is '' 467.53 Lakhs as against the Net Loss of
'' 1,379.29 Lakhs for the financial year 2023-24. The installed capacity remained at the same level of 1.44 lakh
spindles throughout the year 2024-25. Due to adverse market conditions in domestic and export fronts, the
production of yarn was affected resulting in lower turnover. The utilization of the plant was based on the market
demand for yarn during the year.

The revenue segments of the Company continue to be structured with two business segments as (a) Textiles and

(b) Rental Services.

dividend

The Directors have not recommended any dividend for the financial year 2024-25 in the absence of profit.

change in nature of business

There is no change in the nature of business operations of the Company during the year.

rental services

The income generated from rental services during the year was '' 2,303.47 Lakhs (Previous year - '' 1,648.10
Lakhs).

exports

Your Company apart from manufacturing Cotton and Synthetic yarn have outsourced fabrics both for exports as
well as for domestic market. Export of yarn and fabrics accounted for '' 3,371.88 Lakhs as against '' 4,415.47
Lakhs in the previous year, a decrease of around 23.63% from the previous year’s performance.

transfer to reserves

The Company has not transferred any amount to its Reserves during the year under review. However, the loss
incurred during the year has been adjusted with the surplus under the head Retained Earnings.

transfer of unclaimed dividend to investor education and protection fund

In terms of Sections 124 and 125 of the Companies Act, 2013, unclaimed or unpaid Dividend relating to the
financial year 2017-18 is due for remittance to the Investor Education and Protection Fund established by the
Central Government.

Further, pursuant to Section 124(6) of the Companies Act, 2013 read with Investor Education and Protection
Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, 771 Equity Shares of '' 100/- each on which
dividend had remained unclaimed for a period of 7 years has been transferred to the credit of Demat Account
of the IEPF Authority during the year under review. As on 31^st March 2025, 20,135 (2.89%) Equity Shares of the
Company were in the credit of the Demat Account of the IEPF Authority.

During the year under review, unclaimed dividend amount of '' 2,48,931/- for the year 2016-17 has been
transferred to IEPF Authority.

share capital

The paid up Equity Share Capital as on 31^st March 2025 was '' 6,95,55,000/- comprising 6,95,550 Equity shares of
'' 100/- each. During the year under review, the Company has not altered / modified its Authorised Share Capital
and the Company has not made any fresh issue of shares.

weblink of annual return

The Annual Return of the Company for the financial year 2024-25 as required under Section 92(3) of the Companies
Act, 2013 is available on the website of the Company at the link www.lakshmimills.com/annual-return.

board meetings and its committees conducted during the period under review

During the year under review, 6 Meetings of the Board of Directors, 4 Meetings of the Audit Committee, 2 Meetings
of the Nomination and Remuneration Committee, 1 Meeting of the Corporate Social Responsibility Committee,
1 Meeting of the Stakeholders Relationship Committee and 17 Meetings of the Share Transfer Committee were
held. Further details of the same have been enumerated in the Corporate Governance Report annexed herewith.

statement on compliance with secretarial standards

The Directors have devised proper systems to ensure compliance with the provisions of applicable Secretarial
Standards and that such systems are adequate and operating effectively. The Company is in compliance with the
applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

directors’ responsibility statement

Pursuant to the requirements under Section 134(3)(c) of the Companies Act, 2013, with respect to the Directors’
Responsibility Statement, it is hereby confirmed that-

(a) in the preparation of the annual accounts for the year ended 31^st March 2025, the applicable accounting
standards have been followed and there were no material departures from those standards;

(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 loss of the Company for that 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 laid down internal financial controls to be followed by the Company and that such internal
financial controls are adequate and operating effectively; and

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

DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143(12) OF THE COMPANIES ACT,

2013 other than those which are reportable to the central government

The Company has received declarations from all the Independent Directors of the Company confirming that they
meet the criteria of independence as stipulated in Section 149(6) of the Companies Act, 2013 and Regulation
16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and that their name is
included in the data bank as per Rule 6(3) of the Companies (Appointment and Qualification of Directors) Rules,
2014. During the year, the Independent Directors of the Company had no pecuniary relationship or transactions
with the Company other than sitting fees and reimbursement of expenses incurred by them for the purpose
of attending meetings of the Board of Directors and Committee(s). The details of sitting fees paid to the
Independent Directors are mentioned in the Corporate Governance Report. Further, they have also declared that
they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could
impair or impact their ability to discharge their duties with an objective independent judgment and without any
external influence. In the opinion of the Board, the Independent Directors, fulfil the conditions of independence
as specified in Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015. The Independent Directors have also confirmed that they have complied with
the Company’s Code of Business Conduct & Ethics.

Based on the confirmation/disclosures received from the Directors and on the evaluation of the relationships
disclosed, the following Non-Executive Directors are Independent:

Sri K. Murali Mohan, Sri Ashwin Chandran, Sri R. Varadarajan and Smt Suguna Ravichandran

Pursuant to Companies (Appointment and Qualification of Directors) Rules, 2014, the Independent Directors Data
Bank Registration Certificate as required from all the Independent Directors of the Company was taken on note
by the Board of Directors of the Company.

STATEMENT REGARDING OPINION OF THE BOARD WITH REGARD TO INTEGRITY, EXPERTISE AND EXPERIENCE

(including the proficiency) of the independent directors during the year

The Board of Directors have evaluated the Independent Directors during the year 2024-25 and opined that the
integrity, expertise and experience (including proficiency) of the Independent Directors are satisfactory.

familiarization programmes

In compliance with the requirements of the Listing Regulations, the Company has put in place a familiarization
programme for the Independent Directors to familiarize them with their roles, rights and responsibilities as
Independent Directors, the working of the Company, nature of the industry in which the Company operates. The
same is also available on the Company website at https://www.lakshmimills.com/familiarisation-programme.

COMPANY’S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND OTHER
MATTERS PROVIDED UNDER SECTION 178(3) OF THE COMPANIES ACT, 2013

The composition and attendance of the Nomination and Remuneration Committee of Directors of the Company
are reported elsewhere in the Annual Report.

The Board of Directors has framed a policy which lays down a framework in relation to nomination, appointment
and remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. The
Policy broadly lays down the guiding principles, philosophy and the basis for payment of remuneration to the
Executive Directors, Key Managerial Personnel and Senior Management. The policy also provides the criteria
for determining qualifications, positive attributes and Independence of Directors and criteria for appointment
of Key Managerial Personnel / Senior Management pursuant to the provisions of Section 178 of the Companies
Act, 2013 and in terms of Regulation 19(4) of the SEBI Listing Regulations and their performance evaluation
which are considered by the Nomination and Remuneration Committee and the Board of Directors while
making selection of the appointees. The above policy has been posted on the website of the Company at -
https://www.lakshmimills.com/investors/Nomination-and-Remuneration-Policv.pdf.

auditors’ report

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. Subbachar & Srinivasan,
Statutory Auditors.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT,
2013

During the year under review, the Company has made investments and complied with the provisions of Section 186
of Companies Act, 2013. However, the Company has not given any loans or guarantees or provided any securities
covered under the provisions of Companies Act, 2013. Further, the details in respect of investments made in the
earlier years and the year under review have been disclosed in the notes to the Financial Statements.

particulars of contracts or arrangements with related parties

All the transactions of the Company during the year with the related parties were in the ordinary course of
business and on an arm’s length pricing basis and not material in nature and thus a disclosure in Form AOC-2
under the Companies Act, 2013, are not required. Further, there are no material related party transactions
during the year under review with Promoters, Directors or Key Managerial Personnel.

The policy on Related Party Transactions as approved by the Board of Directors of the Company has
been uploaded on the website of the Company and may be accessed through the link at
https://www.lakshmimills.com/wp-content/uploads/Policv-on-Related-Partv-Transactions.pdf.

material changes and commitments affecting the financial position of the company

There is no material change or commitment affecting the financial position of the Company after the closure of
the financial year as on 31^st March 2025 and till the date of this report.

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

The information pertaining to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and
Outgo as required under section 134 (3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies
(Accounts) Rules, 2014 is attached herewith as Annexure - 1 forming part of this report.

statement concerning development and implementation of risk management policy of the
company

The Company follows a comprehensive and integrated risk management process. The risk management process
is designed to safeguard the organization from various risks through adequate and timely actions. It is designed
to anticipate, evaluate and mitigate risks in order to minimize its impact on the business. The potential risks are
reviewed and integrated with the management process such that they receive the necessary consideration during
decision making by the Board of Directors.

details of policy developed and implemented by the company on its corporate social responsibility
initiatives

The Board has formed a Corporate Social Responsibility Committee comprising of the following Directors:

1. Sri S. Pathy - Chairman

2. Sri Aditya Krishna Pathy - Member and

3. Sri Ashwin Chandran - Member

The Company has adopted a Corporate Social Responsibility Policy defining therein the CSR activities to be
undertaken by the Company in areas or subjects specified in Schedule VII of the Companies Act, 2013. The
Corporate Social Responsibility Committee of the Board is responsible for the implementation and effective
monitoring of the CSR activities of the Company. The CSR policy may be accessed on the Company’s website
https://www.lakshmimills.com/other-information.

The Company’s average net profit for the three immediately preceding financial years is less than the prescribed
limit as per Section 135 read with Section 198 of the Companies Act, 2013 and hence no amount has been
prescribed/allocated for the CSR expenditure. Thus, no amount has been spent on the CSR activities of the
Company for the financial year 2024-25.

The Annual Report on the Corporate Social Responsibility (“CSR”) activities of the Company for the year is set out
as Annexure-2 to this report in the format prescribed in the Companies (CSR Policy) Rules, 2014.

annual evaluation of the board on its own performance and of the individual directors

Pursuant to the provisions of the Act and the Listing Regulations, the Board has carried out the annual evaluation
of its own performance, the individual Directors (including the Chairman) as well as an evaluation of the
working of all Board Committees. The performance evaluation was carried out on the basis of the criteria laid
down by Nomination and Remuneration Committee and the inputs received from all the Directors/Members of
the Committees, considering the various aspects of the Board’s functioning, composition of the Board and its
Committees, culture, execution and performance of specific duties, obligations and governance. The Independent
Directors of the Company have also convened a separate meeting on 14.02.2025 to review the performance of
the Non-Independent Directors and the Board as a whole and assessing the quality, quantity and timeliness of
flow of information between the Company and the Board. The results of evaluation have been communicated to
the Chairman of the Board of Directors.

directors’ a key managerial personnel

In accordance with the provisions of Section 152 of the Act and the Articles of Association of the Company,
Sri Aditya Krishna Pathy (DIN 00062224) Director is liable to retire by rotation at the ensuing Annual General
Meeting (“AGM”) and being eligible offers himself for re-appointment.

The Board recommends his reappointment for the consideration of the Members of the Company at the forthcoming
Annual General Meeting. Brief profile of Sri Aditya Krishna Pathy is given in the Notice convening the ensuing
Annual General Meeting.

Sri Aditya Krishna Pathy (DIN 00062224) was appointed as Deputy Managing Director for a period of 5 years from
30.07.2020 and his term of office expires on 29.07.2025. The Nomination and Remuneration Committee and Audit
Committee at their respective meetings held on 28.05.2025 have recommended to the Board the reappointment
of Sri Aditya Krishna Pathy as Deputy Managing Director for a further period of 3 years with the terms and
conditions, and the Board at its meeting held on 28.05.2025 has approved the reappointment of Sri Aditya Krishna
Pathy as Deputy Managing Director for a further period of 3 years from 30.07.2025 subject to the approval of the
Shareholders at the ensuing Annual General Meeting.

Your Directors recommend the reappointment of Sri Aditya Krishna Pathy, as Deputy Managing Director of the
Company

Pursuant to the recommendation of the Nomination and Remuneration Committee and the Board of Directors
at their meeting held on 9^th August 2024, of Sri K. Murali Mohan (DIN: 00626361), Sri Ashwin Chandran (DIN:
00001884) and Sri R. Varadarajan (DIN 00001738) were appointed as Independent Directors of the Company for
the first term of five (5) consecutive years with effect from 9^th September 2024 by the Members at the 114^th
Annual General Meeting held on 9^th September 2024.

During the year under review, the following Non-Executive Independent Directors completed their second term
of five years and retired from the Board of the Company effective from 9^th September 2024:

i. Sri Satish Ajmera (DIN: 00208919)

ii. Sri D. Rajendran (DIN: 00003848)

iii. Sri Vijay Venkataswamy (DIN: 00002906)

The Board places on record its sincere appreciation for the invaluable guidance and counsel rendered by the
above Directors during their period of office.

Subject to the recommendations of the Nomination and Remuneration Committee and approval by the Board of
Directors at their forthcoming meetings, a Women Independent Director shall be appointed at the ensuing Annual
General Meeting to fill the vacancy arising from the retirement of Smt. Suguna Ravichandran.

The Key Managerial Personnel of the Company pursuant to Section 2(51) and 203 of the Companies Act,
2013 are Sri S. Pathy - Chairman and Managing Director, Sri Aditya Krishna Pathy - Deputy Managing Director,
Sri N. Singaravel - Company Secretary and Sri A. Doraiswamy - Chief Financial Officer.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any joint venture, subsidiary or associate company.

fixed deposits

Since the Company has not accepted any fixed deposit covered under Chapter V of the Companies Act, 2013,
there are no deposits remaining unclaimed or unpaid as on 31^st March, 2025 and accordingly, the question of
default in repayment of deposits or payment of interest thereon during the year does not arise.

details of significant and material orders passed by the regulators or courts or tribunals
impacting the going concern status and company’s operation in future

There are no significant material orders passed by the Regulators, Courts, Tribunals which would impact the going
concern status of the Company and its future operations.

adequacy of internal financial controls with reference to the financial statements

Your Company has in place adequate internal financial controls commensurate with the size, scale and complexity
of its operations. Such controls have been assessed during the year under review taking into consideration the
essential components of internal controls stated in the Guidance Note on Audit of Internal Financial Controls
over Financial Reporting issued by the Institute of Chartered Accountants of India. Based on the results of such
assessments carried out by the management, no reportable or significant deficiencies and no material weakness in
the design or operation of any control were observed. The Audit Committee of the Board periodically reviews the
Internal Financial Control Systems and their adequacy and recommends corrective action as and when necessary
to ensure that an effective internal control mechanism is in place.

The Directors and Management confirm that the internal financial controls with reference to the Financial
Statements are commensurate with the size and nature of business of the Company. A report of Auditors pursuant
to Section 143(3)(i) of the Companies Act, 2013 certifying the adequacy of Internal Financial Controls is annexed
with the Auditors Report.

composition of audit committee and vigil mechanism / whistle blower policy

The composition and attendance of the Audit Committee of the Board of Directors of the Company are
disclosed in the Corporate Governance Report. The Company has devised a vigil mechanism in the form of a
Whistle Blower Policy to provide adequate safeguards to deal with instances of fraud and
mismanagement and to report concerns about unethical behavior or any violation of the Company’s Code of
Conduct in pursuance of provisions of Section 177(10) of the Companies Act, 2013 as explained in the Corporate
Governance Report and also the Policy is posted on the website of company and can be accessed at the link
https://www.lakshmimills.com/wp-content/uploads/Vigil-Mechanism-Whistle-Blower-Policv.pdf. During the
year under review, there were no complaints received under this mechanism.

auditors

statutory auditors

M/s. Subbachar & Srinivasan (Firm Registration No.004083S), Chartered Accountants, Coimbatore were appointed
as the Statutory Auditors of the Company for a period of five years at the 112^th Annual General Meeting of the
Company held on 9^th September 2022.

The Company has received a Certificate from the Statutory Auditors to the effect that their continued
appointment as the Statutory Auditors of the Company, would be within the limits prescribed under section 139
of the Companies Act, 2013.

cost auditors

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, as
amended from time to time, the Board of Directors on the recommendation of the Audit Committee has reappointed
M/s. A.R.Ramasubramania Raja & Co., (Firm Registration No. 000519) a firm of Cost Accountants, as the Cost
Auditors to audit the cost records of the Company for the financial year 2025-26. M/s. A.R.Ramasubramania Raja
& Co., have confirmed that their appointment is within the limits of section 141(3)(g) of the Companies Act, 2013
and have also certified that they are free from any disqualifications specified under section 141(3) and proviso
to section 148(3) read with section 141(4) of the Companies Act, 2013. The Audit Committee has also received a
Certificate from the Cost Auditor certifying their independence and arm’s length relationship with the Company.

As per the provisions of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, a
resolution seeking Members’ approval for the remuneration payable to the Cost Auditors for the financial year
2025-26 forms part of the Notice convening the 115^th Annual General Meeting of the Company for their ratification.
Accordingly, the Board recommends for the resolution seeking Members’ ratification for the remuneration payable
to M/s. A.R.Ramasubramania Raja & Co., Cost Auditors.

MAINTENANCE OF COST RECORDS UNDER SUB-SECTION (1) OF SECTION 148 OF THE COMPANIES ACT, 2013

The Company has maintained the Cost Records as specified by the Central Government under sub-section (1) of
Section 148 of the Companies Act, 2013.

secretarial auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and its relevant rules made thereunder, the
Board of Directors had appointed M/s. MDS & Associates LLP, Company Secretaries, Coimbatore as Secretarial
Auditors for the Financial Year 2024-25. Accordingly, the Secretarial Audit Report for the financial year ended
March 31, 2025, is annexed herewith as Annexure - 3 to this Report. With respect to the observations made by
Secretarial Auditors of the Company in their report for the year ended March 31, 2025, which are self-explanatory,
your Directors wish to state that necessary steps have been initiated to ensure due compliance with all applicable
statutory requirements.

Pursuant to Regulation 24A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the
provisions of Section 204 of the Companies Act, 2013, read with the Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014, and subject to the approval of Shareholders in the ensuing Annual General
Meeting, the Board of Directors of the Company have recommended the appointment of MDS & Associates LLP,
Company Secretaries, Coimbatore as Secretarial Auditors of the Company for a first term of 5 (five) consecutive
financial years commencing from the financial year 2025-26.

M/s. MDS & Associates LLP, Company Secretaries, Coimbatore have given their consent and confirmed their
eligibility for appointment as Secretarial Auditors of the Company. Further, the Secretarial Auditors has confirmed
that they hold a valid Peer Review Certificate issued by the Institute of Company Secretaries of India. The necessary
resolution for their appointment has been included in the Agenda of the Annual General Meeting Notice for the
approval of the Members

corporate governance

Pursuant to Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the
Management Discussion and Analysis Report, Report on Corporate Governance and Auditors Certificate regarding
compliance of conditions of Corporate Governance provided elsewhere in this Report, forms part of the Directors’
Report.

particulars of employees

Disclosures with respect to the remuneration of Directors and employees as required under Section 197(12) of
Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 is appended as Annexure - 4 to this Report.

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

The Company has in place a policy on Sexual Harassment of Women at Workplace in line with the requirements
of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal
Complaint Committee has been set up to redress complaints received. All employees (permanent, contractual,
temporary, trainees) are covered under this policy. There were no complaints of harassment received from any
of the women employees of the Company during the financial year 2024-25.

The following is the summary of sexual harassment complaints received and disposed of during the year 2024-25:

i. Number of complaints received - Nil

ii. Number of complaints disposed of - NA

ceo/cfo certification

As required under Regulation 33(2)(a) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015, the Chairman and Managing Director (Chief Executive Officer) and the Chief Financial Officer have furnished
necessary certificate to the Board on the financial statements presented for the year ended 31^st March 2025.

details of application made or any proceeding pending under the insolvency and bankruptcy

CODE, 2016 DURING THE YEAR

No application has been made and no proceedings are pending against the Company under the Insolvency and
Bankruptcy Code, 2016.

details of difference between amount of the valuation done at the time of one time settlement
and the valuation done while taking loan from the banks or financial institutions along with
the reasons thereof.

The disclosure under this clause is not applicable as the Company has not undertaken any one-time settlement
with the banks or financial institutions.

listing of equity shares

The Company’s Equity Shares continue to be listed on BSE Limited and the details of listing have been given in
the Corporate Governance Report forming part of this Directors’ Report. We confirm that the Listing fee for the
Financial Year 2025-2026 has been paid to the Stock Exchanges within the stipulated time.

acknowledgement

The Board acknowledges the continued support from the Bankers, Cotton, Yarn and Fabric Dealers of the Company
and Shareholders and appreciates the valuable services rendered by the employees at all levels.

May the Goddess Lakshmi continue to shower her choicest Blessings for the prosperity of the Company in the
years to come.

By Order of the Board
For The Lakshmi Mills Co. Ltd.,

s. pathy

Coimbatore Chairman and Managing Director

28^th May, 2025 (DIN 00013899)

---

Mar 31, 2024

Your Directors have pleasure in presenting the Hundred and Fourteenth Year Annual Report together with the audited accounts of the Company for the year ended 31st March 2024.

FINANCIAL SUMMARY / HIGHLIGHTS

	31.03.2024	31.03.2023
No. of days worked	357	354
	('' in Lakhs)
Revenue from operations	25,296.90	24,040.40
Other income	804.14	404.77
GROSS REVENUE	26,101.04	24,445.17
Profit / (Loss) before Tax and Exceptional Items	(2,189.93)	(773.87)
Less : Exceptional items	169.06	96.01
Profit / (Loss) before Taxation	(2,020.87)	(677.86)
Tax Expense	(641.58)	(176.66)
Profit / (Loss) after Taxation	(1,379.29)	(501.20)

OPERATIONS

The Company’s Revenue from Operations increased by 5% from Rs. 24,040.40 Lakhs in 2022-23 to Rs. 25,296.90 Lakhs in 2023-24 and the Net Loss after Tax for financial year 2023 - 24 is Rs. 1,379.29 Lakhs as against the Net Loss of Rs. 501.20 Lakhs for the financial year 2022-23. The installed capacity increased from 1.33 to 1.44 lakh spindles during the year 2023-24. Due to adverse market conditions in domestic and export fronts, the production of yarn was affected resulting in lower turnover. As such the Company was not able to work in full capacity during the year under review.

The revenue segments of the Company continues to be structured with two business segments as (a) Textiles and (b) Rental Services.

CHANGE IN NATURE OF BUSINESS

There is no change in the nature of business operations of the Company during the year.

RENTAL SERVICES

The income generated from rental services during the year was Rs. 1,539.58 Lakhs (Previous year - Rs. 655.16 Lakhs).

EXPORTS

Your Company apart from manufacturing Cotton and Synthetic yarn have outsourced fabrics both for exports as well as for domestic market. Export of yarn and fabrics accounted for Rs. 4,415.47 Lakhs as against Rs. 5,188.21 Lakhs in the previous year, a decrease of around 14.89% from the previous year’s performance.

DIVIDEND

The Board of Directors of the Company have not recommended dividend for the financial year 2023-24. TRANSFER TO RESERVES

The Company has not transferred any amount to its Reserves during the year under review. However, an amount of Rs. 1,379.29 Lakhs of the current loss has been adjusted with the surplus under the head retained earnings.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

In terms of Sections 124 and 125 of the Companies Act, 2013, unclaimed or unpaid Dividend relating to the financial year 2016-17 is due for remittance to the Investor Education and Protection Fund established by the Central Government.

Further, pursuant to Section 124(6) of the Companies Act, 2013 read with Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, 708 Equity Shares of Rs.100/- each on which dividend had remained unclaimed for a period of 7 years has been transferred to the credit of Demat Account identified by the IEPF Authority during the year under review. As on 31st March 2024, 19,386 Equity Shares of the Company were in the credit of the Demat Account of the IEPF Authority.

During the year under review, unclaimed dividend amount of Rs. 2,48,085/- for the year 2015-16 has been transferred to IEPF Authority.

SHARE CAPITAL

The paid up Equity Share Capital as on 31st March 2024 was Rs. 6,95,55,000/- comprising 6,95,550 shares of Rs. 100/- each. During the year under review, the Company has not made any fresh issue of shares.

WEBLINK OF ANNUAL RETURN

The Annual Return of the Company for the financial year 2023-24 as required under Section 92(3) of the Companies Act, 2013 is available on the website of the Company at the link www.lakshmimills.com/annual-return.

BOARD MEETINGS AND ITS COMMITTEES CONDUCTED DURING THE PERIOD UNDER REVIEW

During the year under review, 4 Meetings of the Board of Directors, 4 Meetings of the Audit Committee, 2 Meetings of the Nomination and Remuneration Committee, 1 Meeting of the Corporate Social Responsibility Committee, 1 Meeting of the Stakeholders Relationship Committee and 21 Meetings of the Share Transfer Committee were held. Further details of the same have been enumerated in the Corporate Governance Report annexed herewith.

STATEMENT ON COMPLIANCE WITH SECRETARIAL STANDARDS

The Directors have devised proper systems to ensure compliance with the provisions of applicable Secretarial Standards and that such systems are adequate and operating effectively. The Company is in compliance with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the requirements under Section 134(3)(c) of the Companies Act, 2013, with respect to the Directors’ Responsibility Statement, it is hereby confirmed that-

(i) In the preparation of the annual accounts for the year ended 31st March 2024, the applicable accounting standards have been followed and there were no material departures from those standards;

(ii) 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 loss of the Company for that period;

(iii) 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;

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

(v) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively; and

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

DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143(12) OF THE COMPANIES ACT, 2013 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT

There was no instance of fraud identified or reported by the Statutory Auditors during the course of their audit for the year to report to the Audit Committee and/or Board pursuant to Section 143(12) of the Companies Act, 2013 and rules framed thereunder.

DECLARATION OF INDEPENDENT DIRECTORS

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as stipulated in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and that their name is included in the data bank as per Rule 6(3) of the Companies (Appointment and Qualification of Directors) Rules, 2014. During the year, the Independent Directors of the Company had no pecuniary relationship or transactions with the Company other than sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board of Directors and Committee(s). The details of remuneration and /or other benefits of the Independent Director are mentioned in the Corporate Governance Report. Further, they have also declared that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence. In the opinion of the Board, the Independent Directors, fulfil the conditions of independence as specified in Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also confirmed that they have complied with the Company’s Code of Business Conduct & Ethics.

Based on the confirmation/disclosures received from the Directors and on the evaluation of the relationships disclosed, the following Non-Executive Directors are Independent:

Sri D. Rajendran, Sri Satish Ajmera, Sri Vijay Venkataswamy and Smt Suguna Ravichandran

Pursuant to Companies (Appointment and Qualification of Directors) Rules, 2014 the Certificate of Registration as required from all the Independent Directors of the Company was taken on note by the Board of Directors of the Company.

STATEMENT REGARDING OPINION OF THE BOARD WITH REGARD TO INTEGRITY, EXPERTISE AND EXPERIENCE (INCLUDING THE PROFICIENCY) OF THE INDEPENDENT DIRECTORS DURING THE YEAR

The Board of Directors have evaluated the Independent Directors during the year 2023-24 and opined that the integrity, expertise and experience (including proficiency) of the Independent Directors is satisfactory.

FAMILIARIZATION PROGRAMMES

In compliance with the requirements of the Listing Regulations, the Company has put in place a familiarization programme for the Independent Directors to familiarize them with their roles, rights and responsibilities as Independent Directors, the working of the Company, nature of the industry in which the Company operates. The same is also available on the Company website at https://www.lakshmimills.com/familiarisation-programme.

COMPANY’S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND OTHER MATTERS PROVIDED UNDER SECTION 178(3) OF THE COMPANIES ACT, 2013

The composition and attendance of the Nomination and Remuneration Committee of Directors of the Company are reported elsewhere in the Annual Report.

The Board of Directors has framed a policy which lays down a framework in relation to nomination, appointment and remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. The Policy broadly lays down the guiding principles, philosophy and the basis for payment of remuneration to the Executive Directors, Key Managerial Personnel and Senior Management. The policy also provides the criteria for determining qualifications, positive attributes and Independence of Directors and criteria for appointment of Key Managerial Personnel / Senior Management pursuant to the provisions of Section 178 of the Companies Act, 2013 and in terms of Regulation 19(4) of the SEBI Listing Regulations and their performance evaluation which are considered by the Nomination and Remuneration Committee and the Board of Directors while making selection of the appointees. The above policy has been posted on the website of the Company at - https://www.lakshmimills.com/investors/ Nomination-and-Remuneration-Policy.pdf.

AUDITORS’ REPORT

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. Subbachar & Srinivasan, Statutory Auditors.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013

During the year under review, the Company has made investments and complied with the provisions of Section 186 of Companies Act, 2013 and the details in respect of investments have been disclosed in the notes to the Financial Statements.

However, the Company has not given any loans or guarantees or provided any securities covered under the provisions of Companies Act, 2013.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All the transactions of the Company during the year with the related parties were in the ordinary course of business and on an arm’s length pricing basis and not material in nature and thus a disclosure in Form AOC-2 is not required. Further, there are no material related party transactions during the year under review with Promoters, Directors or Key Managerial Personnel.

The policy on Related Party Transactions as approved by the Board of Directors of the Company has been uploaded on the website of the Company and may be accessed through the link at https://www.lakshmimills. com/investors/Policy-on-Related-Party-Transactions.pdf.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There is no material change or commitment affecting the financial position of the Company after the closure of the financial year as on 31st March 2024 and till the date of this report.

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

The information pertaining to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo as required under section 134 (3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is attached herewith as Annexure - 1 forming part of this report.

STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY

The Company follows a comprehensive and integrated risk management process. The risk management process is designed to safeguard the organization from various risks through adequate and timely actions. It is designed to anticipate, evaluate and mitigate risks in order to minimize its impact on the business. The potential risks are reviewed and integrated with the management process such that they receive the necessary consideration during decision making by the Board of Directors.

DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

The Board had formed a Corporate Social Responsibility Committee comprising of the following Directors:

1. Sri S. Pathy - Chairman

2. Sri Aditya Krishna Pathy - Member and

3. Sri D. Rajendran - Member

The company has adopted a Corporate Social Responsibility Policy defining therein the CSR activities to be undertaken by the Company in areas or subjects specified in Schedule VII of the Companies Act, 2013. The Corporate Social Responsibility Committee of the Board is responsible for the implementation and effective monitoring of the CSR activities of the Company. The CSR policy may be accessed on the Company’s website https://www.lakshmimills.com/other-information.

The Company’s average net profits of the three immediately preceding financial years of the financial year 202324 is less than the prescribed limit as per Section 135 read with Section 198 of the Companies Act, 2013 and hence no amount has been prescribed/allocated for the CSR expenditure. Thus, no amount has been spent on the CSR activities of the Company for the financial year 2023-24.

The brief outline of the Corporate Social Responsibility (“CSR”) Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out as Annexure-2 to this report in the format prescribed in the Companies (CSR Policy) Rules, 2014.

ANNUAL EVALUATION OF THE BOARD ON ITS OWN PERFORMANCE AND OF THE INDIVIDUAL DIRECTORS

Pursuant to the provisions of the Act and the Listing Regulations, the Board has carried out the annual evaluation of its own performance, the individual Directors (including the Chairman) as well as an evaluation of the working of all Board Committees. The performance evaluation was carried out on the basis of the criteria laid down by Nomination and Remuneration Committee and the inputs received from all the Directors/Members of the Committees, considering the various aspects of the Board’s functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance. The Independent Directors of the Company have also convened a separate meeting for reviewing the performance of the NonIndependent Directors and the Board as a whole and assessing the quality, quantity and timeliness of flow of information between the Company and the Board. The results of evaluation have been communicated to the Chairman of the Board of Directors.

DIRECTORS’ & KEY MANAGERIAL PERSONNEL

In accordance with the provisions of Section 152 of the Act and the Articles of Association of the Company, Sri Sanjay Jayavarthanavelu, (DIN 00004505) Director is liable to retire by rotation at the ensuing Annual General Meeting (“AGM”) and being eligible offers himself for re-appointment.

The Board recommends his reappointment for the consideration of the Members of the Company at the forthcoming Annual General Meeting. Brief profile of Sri Sanjay Jayavarthanavelu is given in the Notice convening the Annual General Meeting.

In accordance with the provisions of Section 152 of the Act, upon completion of the second term of office as Independent Director - Sri Satish Ajmera, Sri D. Rajendran and Sri Vijay Venkataswamy are vacating the Office from the conclusion of the ensuing Annual General Meeting.

On the recommendations of the Nomination and Remuneration Committee in their ensuing meeting, the Independent Directors will be appointed for a consecutive period of 5 years at the ensuing Annual General Meeting.

The Key Managerial Personnel of the Company pursuant to Section 2(51) and 203 of the Companies Act, 2013 are Sri S. Pathy - Chairman and Managing Director, Sri Aditya Krishna Pathy - Deputy Managing Director, Sri N. Singaravel - Company Secretary and Sri A. Doraiswamy - Chief Financial Officer.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any joint venture, subsidiary or associate company.

FIXED DEPOSITS

Since the Company has not accepted any fixed deposit covered under Chapter V of the Companies Act, 2013, there are no deposits remaining unclaimed or unpaid as on 31st March, 2024 and accordingly, the question of default in repayment of deposits or payment of interest thereon during the year does not arise.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY’S OPERATION IN FUTURE

There are no significant material orders passed by the Regulators, Courts, Tribunals which would impact the going concern status of the Company and its future operations.

ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

Your Company has in place adequate internal financial controls commensurate with the size, scale and complexity of its operations. Such controls have been assessed during the year under review taking into consideration the essential components of internal controls stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. Based on the results of such assessments carried out by the management, no reportable or significant deficiencies and no material weakness in the design or operation of any control were observed. The Audit Committee of the Board periodically reviews the Internal Financial Control Systems and their adequacy and recommends corrective action as and when necessary to ensure that an effective internal control mechanism is in place.

The Directors and Management confirm that the internal financial controls with reference to the Financial Statements are commensurate with the size and nature of business of the Company. A report of Auditors pursuant to Section 143(3)(i) of the Companies Act, 2013 certifying the adequacy of Internal Financial Controls is annexed with the Auditors Report.

COMPOSITION OF AUDIT COMMITTEE AND VIGIL MECHANISM / WHISTLE BLOWER POLICY

The composition and attendance of the Audit Committee of the Board of Directors of the Company are disclosed in the Corporate Governance Report of the Annual Report. The Company has devised a vigil mechanism in the form of a Whistle Blower Policy to provide adequate safeguards to deal with instances of fraud and mismanagement and to report concerns about unethical behavior or any violation of the Company’s Code of Conduct in pursuance of provisions of Section 177(10) of the Companies Act, 2013 as explained in the Corporate Governance Report and also posted on the website of company and can be accessed at the link https://www.lakshmimills.com/

investors/Vigil-Mechanism-Whistle-Blower-Policy.pdf. During the year under review, there were no complaints received under this mechanism.

AUDITORS

STATUTORY AUDITORS

M/s. Subbachar & Srinivasan (Firm Registration No.004083S), Chartered Accountants, Coimbatore were appointed as the Statutory Auditors of the Company for a period of five years at the 112th Annual General Meeting of the company held on 9th September 2022.

The Company has received a Certificate from the Statutory Auditors to the effect that their continued appointment as the Statutory Auditors of the Company, would be within the limits prescribed under section 139 of the Companies Act, 2013.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Audit and Auditors) Rules, 2014, as amended from time to time, the Board of Directors on the recommendation of the Audit Committee has reappointed M/s. A.R.Ramasubramania Raja & Co., (Firm Registration No. 000519) a firm of Cost Accountants, as the Cost Auditors to audit the cost records of the Company for the financial year 2024-25. M/s. A.R.Ramasubramania Raja & Co., have confirmed that their appointment is within the limits of section 141(3) (g) of the Companies Act, 2013 and have also certified that they are free from any disqualifications specified under section 141(3) and proviso to section 148(3) read with section 141(4) of the Companies Act, 2013.

The Audit Committee has also received a Certificate from the Cost Auditor certifying their independence and arm’s length relationship with the Company.

As per the provisions of the Companies Act 2013 read with the Companies (Cost Audit and Auditors) Rules, 2014, a resolution seeking Members’ approval for the remuneration payable to the Cost Auditors for the financial year 2024-25 forms part of the Notice convening the 114th Annual General Meeting of the Company for their ratification. Accordingly, the Board recommends for the resolution seeking Members’ ratification for the remuneration payable to M/s. A.R.Ramasubramania Raja & Co., Cost Auditors.

MAINTENANCE OF COST RECORDS UNDER SUB-SECTION (1) OF SECTION 148 OF THE COMPANIES ACT, 2013

The Company has maintained the Cost Records as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013.

SECRETARIAL AUDITORS

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Sri M.D.Selvaraj, FCS, Managing Partner of MDS & Associates LLP, Company Secretaries as the Secretarial Auditors of the Company for the year 202425 to undertake the Secretarial Audit of the Company. The Secretarial Audit Report for the financial year 2023-24 is annexed herewith as Annexure - 3 and forms an integral part of this Report. With respect to the observations made by M/s. MDS & Associates LLP, Company Secretaries, Coimbatore, Secretarial Auditors of the Company in their report for the year ended March 31, 2024, which are self-explanatory, your Directors wish to state that necessary steps have been initiated to ensure due compliance with all applicable statutory requirements.

CORPORATE GOVERNANCE

Pursuant to Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Management Discussion and Analysis Report, Report on Corporate Governance and Auditors Certificate regarding compliance of conditions of Corporate Governance provided elsewhere in this Report, forms part of the Directors’ Report.

PARTICULARS OF EMPLOYEES

Disclosures with respect to the remuneration of Directors and employees as required under Section 197(12) of Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended as Annexure - 4 to this Report.

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

The Company has in place a policy on Sexual Harassment of Women at Workplace in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaint Committee has been set up to redress complaints received. All employees (permanent, contractual, temporary, trainees) are covered under this policy. There were no complaints received from any employee of the Company during the financial year 2023-24.

The following is the summary of sexual harassment complaints received and disposed of during the year 2023-24:

i. Number of complaints received - Nil

ii. Number of complaints disposed of - NA

CEO/CFO CERTIFICATION

As required under SEBI (Listing Obligations and Disclosure Requirements) Rules 2015, the Chairman and Managing Director (Chief Executive Officer) and the Chief Financial Officer have furnished necessary certificate to the Board on the financial statements presented for the year ended 31st March 2024.

DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016 DURING THE YEAR

No applications have been made and no proceedings are pending against the Company under the Insolvency and Bankruptcy Code, 2016.

DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF.

The disclosure under this clause is not applicable as the Company has not undertaken any one-time settlement with the banks or financial institutions.

ACKNOWLEDGEMENT

The Board acknowledges the continued support from the Bankers, Cotton, Yarn and Cloth Dealers of the Company and Shareholders and appreciates the valuable services rendered by the employees at all levels.

May the Goddess Lakshmi continue to shower her choicest Blessings for the prosperity of the Company in the years to come.

By Order of the Board For The Lakshmi Mills Co. Ltd., S. PATHY

Coimbatore Chairman and Managing Director

28^th May, 2024 (DIN 00013899)

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Mar 31, 2018

Ladies and Gentlemen,

The Directors have pleasure in presenting the Hundred and Eighth year Annual Report together with the audited accounts of the Company for the year ended 31.03.2018.

(Rs. in Lakhs)

WORKING RESULTS	31.3.2018	31.3.2017
No. of days worked	356	357
Sales	23,668.46	22,722.73
Other income	686.47	773.49
GROSS REVENUE	24,354.93	23,496.22
Profit before Tax and Exceptional Items	495.80	460.61
Less : Exceptional items	222.80	17.65
Profit before Taxation	273.00	442.96
Tax Expense	130.71	336.39
Profit after Taxation	142.29	106.57
Other Comprehensive Income	13,305.35	4,729.11
Total Comprehensive Income	13,447.64	4,835.68

Transition to Indian Accounting Standards

The Ministry of Corporate Affairs (MCA) vide its notification dated 16.02.2015, notified the Indian Accounting Standards (Ind AS) applicable to certain classes of companies. Ind AS has replaced the existing Indian GAAP prescribed under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014. For the Company, Ind AS is applicable from April 1, 2017, with a transition date of April 1, 2016.

The following are the areas which has an impact on account of transition to Ind AS:

- Expected credit loss model for provisioning on trade receivables.

- Fair valuation of investments in equity instruments.

- Fair Valuation of Rent advance.

- Employee costs pertaining to defined benefit obligation.

- Revenue Recognition.

- Recognition of dividend liability and related taxes.

- Recognition of Government Grants.

- Deferred taxes.

The reconciliations and descriptions of the effect of the transition from IGAAP to Ind AS have been provided in the notes to accounts in the standalone financial statements.

OPERATIONS

The Spindles capacity remained at the same level of 1.33 lakh spindles throughout the year 2017-18. Overall utilisation remained around 95% - same as that of 2016-17.

Your Company continued to outsource fabrics both for exports as well as for domestic market. Export of yarn and fabric accounted for Rs. 3529 Lakhs as against Rs. 4999 Lakhs in the previous year, a decrease of around 30% over the previous year’s performance.

Overall, the operational performance was better during the year, thanks to improvement in realization of yarn prices as well as power cost reduction.

There was no change in the nature of business of the Company during the financial year ended 31^st March, 2018.

TRANSFER TO RESERVES

The Company has not transferred any amount to its Reserves during the year under review.

DIVIDEND

The Directors have recommended a dividend of Rs. 9/- per Equity Share of Rs. 100/- each, at 9% for the financial year 20172018 (Previous Year - 9%). The Dividend of 9%, if approved at the forth coming Annual General Meeting, will result in the outflow of Rs. 62.60 Lakhs to the company in addition to Rs. 12.87 Lakhs by way of dividend distribution tax.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

In terms of the Companies Act, 2013 any unclaimed or unpaid Dividend relating to the financial year 2010-11, will be transferred to the Investor Education and Protection Fund established by the Central Government, after the conclusion of this Annual General Meeting.

As per the requirements of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, 10,937 equity shares of Rs. 100/- each on which dividend had remained unclaimed for a period of 7 years have been transferred to the credit of Demat account identified by the IEPF Authority during the year under review.

SHARE CAPITAL

The paid up Equity Share Capital as on March 31, 2018 was Rs. 6,95,55,000/- comprising 6,95,550 shares of Rs. 100/- each. During the year under review, the company has not made any fresh issue of shares.

EXTRACT OF ANNUAL RETURN

As per the requirements of the Companies Act, 2013, the extract of annual return in the prescribed Form MGT 9 is annexed hereto as Annexure - 1 forming part of this report.

BOARD MEETINGS AND ITS COMMITTEES CONDUCTED DURING THE PERIOD UNDER REVIEW

During the year under review, 4 Meetings of the Board of Directors, 4 Meetings of the Audit Committee, 3 Meetings of the Nomination and Remuneration Committee, 1 Meeting of the Corporate Social Responsibility Committee, 1 Meeting of the Stakeholders Relationship Committee and 18 Meetings of the Share Transfer Committee were held. Further details of the same have been enumerated in the Corporate Governance Report annexed herewith.

STATEMENT ON COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the Secretarial Standards on Board and General Meetings issued by the Institute of Company Secretaries of India.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the requirements under Section 134(3)(c) of the Companies Act, 2013, with respect to the Directors’ Responsibility Statement, it is hereby confirmed that-

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures from those standards;

(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 profit of the Company for that period;

(c) the Directors have taken proper and sufficient care for maintenance of adequate accounting records in accordance with the provisions of the Companies Act 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 laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143(12) OF THE COMPANIES ACT, 2013 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT

There were no instances of frauds identified or reported by the Statutory Auditors during the course of their audit pursuant to Section 143(12) of the Companies Act, 2013.

DECLARATION OF INDEPENDENT DIRECTORS

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to act as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

NOMINATION AND REMUNERATION COMMITTEE AND POLICY

The Company has reconstituted the Nomination and Remuneration Committee of Directors of the Company and its composition and attendance are reported elsewhere in the Annual Report. The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy on Directors’ appointment and remuneration including criteria for determining qualification, positive attributes, independence of a Director and other matters provided under sub-section (3) of Section 178. The said Policy is available on the website of the Company - www.lakshmimills.com. The abstract of the Policy is annexed hereto as Annexure - 6.

EXPLANATION AND COMMENTS ON AUDITOR REPORTS

The reports of the Statutory Auditors M/s. M. S. Jagannathan & Visvanathan (annexed elsewhere in the Annual Report) and that of the Secretarial Auditor Mr. M.D. Selvaraj, annexed hereto as Annexure - 2 are self explanatory having no adverse comments.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The Company has not given any loans or guarantees covered under the provisions of Section 186 of the Companies Act, 2013. The details of the investments made by the Company are given in the notes to the financial statements.

RELATED PARTY TRANSACTIONS

All transactions of the Company with the related parties were in the ordinary course of business and on an arm’s length pricing basis. Since there are no transactions which are not on arm’s length basis and material in nature, the requirement of disclosure of such related party transactions in Form AOC-2 does not arise.

The policy on Related Party Transactions as approved by the Board of Directors of the Company has been uploaded on the Company’s website and may be accessed through the link at www.lakshmimills.com.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There is no material change or commitments after the closure of the financial year as on 31.03.2018 and till the date of this report.

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

The information pertaining to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo as required under section 134 (3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is attached herewith as Annexure - 3 to this report.

RISK MANAGEMENT

The Company follows a comprehensive and integrated risk management process. The risk management process is designed to safeguard the organization from various risks through adequate and timely actions. It is designed to anticipate, evaluate and mitigate risks in order to minimize its impact on the business. The potential risks are inventoried and integrated with the management process such that they receive the necessary consideration during decision making and are periodically reviewed and revised by the Board of Directors.

CORPORATE SOCIAL RESPONSIBILITY

The Board has constituted a CSR Committee comprising of Sri S. Pathy, Sri Aditya Krishna Pathy and Sri D. Rajendran. The company has adopted a Corporate Social Responsibility Policy defining therein the CSR activities to be undertaken by the Company in line with the provisions of Schedule VII of the Companies Act, 2013. The Corporate Social Responsibility Committee of the Board is responsible for the implementation and effective monitoring of the CSR activities of the Company. The Annual Report on Company’s CSR activities of the Company is furnished in the prescribed format as Annexure - 4 and attached to this report.

BOARD EVALUATION

Pursuant to the provisions of the Act, the Board has carried out an annual evaluation of its own performance, the individual Directors (including the Chairman) as well as an evaluation of the working of all Board Committees. The performance evaluation was carried out on the basis of inputs received from all the Directors / Members of the Committees, as the case may be. The Independent Directors of the Company have also convened a separate meeting for this purpose. All the results of evaluation has been communicated to the Chairman of the Board of Directors.

DIRECTORS’ & KEY MANAGERIAL PERSONNEL

In accordance with the provisions of Section 152 of the Act and the Articles of Association of the Company, Sri Sanjay Jayavarthanavelu, Director is liable to retire by rotation at the ensuing Annual General Meeting (“AGM”) and being eligible offers himself for re-appointment.

Your directors recommend the re-appointment.

Sri V. Jagannathan, Independent Director has resigned from the Board of Directors of the Company with effect from 13.12.2017 due to his advanced age.

Sri Vijay Venkatasamy has been inducted to the Board of Directors of the Company with effect from 14.02.2018, as an Independent Director in the place of Sri V. Jagannathan and he shall hold office upto the date of this Annual General Meeting. Accordingly, necessary resolution proposing the appointment of Sri.Vijay Venkatasamy as an Independent Director of the Company has been included in the Agenda of the Notice convening the Annual General Meeting for the approval of the members.

Key Managerial Personnel of the Company as required pursuant to Section 2(51) and 203 of the Companies Act, 2013 are Sri S. Pathy - Chairman and Managing Director, Sri Aditya Krishna Pathy - Deputy Managing Director, Sri N. Singaravel - Company Secretary and Sri V. Kannappan - Chief Financial Officer.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any joint venture, subsidiary or associate company.

FIXED DEPOSITS

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has adequate internal control systems to monitor business processes, financial reporting and compliance with applicable regulations. The systems are periodically reviewed for identification of control deficiencies and formulation of time bound action plans to improve efficiency at all the levels. The Audit Committee of the Board constantly reviews internal control systems and their adequacy, significant risk areas, observations made by the internal auditors on control mechanism and the operations of the Company and recommendations made for corrective action through the internal audit reports. The Committee reviews the statutory auditors’ report, key issues, significant processes and accounting policies.

The Directors and Management confirm that the Internal Financial Controls (IFC) are adequate with respect to the operations of the Company. A report of Auditors pursuant to Section 143(3)(i) of the Companies Act, 2013 certifying the adequacy of Internal Financial Controls is annexed with the Auditors Report.

AUDITORS

STATUTORY AUDITORS

M/s. M.S.Jagannathan& Visvanathan (Firm Registration No.001209S), Chartered Accountants, Coimbatore were appointed as the Statutory Auditors of the company for a period of five years at the 107th Annual General Meeting of the company held on 26th July 2017. Pursuant to the amendment of Section 139 of the Companies Act, 2013, the Company is no longer required to seek the ratification of the appointment of the Auditor at every Annual General Meeting. Accordingly, it has been proposed to obtain the approval of the members to continue the appointment of the Statutory Auditors without ratification of their appointment at every Annual General Meeting.

The Company has received a Certificate from the Statutory Auditors to the effect that their continued appointment as the Statutory Auditors of the Company, would be within the limits prescribed under section 139 of the Companies Act, 2013. Members are requested to grant their approval for the continuation of the appointment of the Auditors for a period up to the conclusion of the 112thAnnual General Meeting of the Company which ought to be held during the year 2022 without ratification at every Annual General Meeting.

SECRETARIAL AUDITORS

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. M.D.Selvaraj, MDS & Associates, Company Secretary in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit report is annexed herewith as Annexure - 2.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the Directors on the recommendation of the Audit Committee have appointed M/s. A.R.Ramasubramania Raja & Co., a firm of Cost Accountants, as the Cost Auditor of the Company for the financial year 2018 - 19.

Pursuant to Section 148 of the Companies Act 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the remuneration payable to the Cost Auditors for the financial year 2017-18 & 2018 - 19 is subject to the approval of the shareholders in a general meeting. The Board recommends the ratification of their remuneration.

COST RECORDS

The Company has maintained the Cost Records as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013.

CORPORATE GOVERNANCE

Pursuant to Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, Management Discussion and Analysis Report, Report on Corporate Governance and Auditors Certificate regarding compliance of conditions of Corporate Governance provided elsewhere in this Report, forms part of the Directors’ Report.

COMPOSITION OF AUDIT COMMITTEE AND VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has reconstituted the Audit Committee of the Board of Directors of the Company and its composition and attendance are disclosed elsewhere in the Annual Report. The Company has devised a vigil mechanism in the form of a Whistle Blower Policy in pursuance of provisions of Section 177(10) of the Companies Act, 2013 and the policy is explained in corporate governance report and also posted on the website of company and can be accessed at the link http://www. lakshmimills.com. During the year under review, there were no complaints received under this mechanism.

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

The Company has in place a policy on Sexual Harassment of Women at Workplace in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Compliant Committee has been set up to redress complaints received. All employees (permanent, contractual, temporary, trainees) are covered under this policy. There were no complaints received from any employee during the financial year 2017 - 18.

PARTICULARS OF EMPLOYEES

Disclosures with respect to the remuneration of Directors and employees as required under Section 197(12) of Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been appended as Annexure - 5 to this Report.

ACKNOWLEDGEMENT

The Board acknowledges the continued assistance from the Bankers, Cotton, Yarn and Cloth Dealers of the Company and Shareholders and appreciates the valuable services rendered by the employees at all levels.

May the Goddess Lakshmi continue to shower her choicest Blessings for the prosperity of the Company in the years to come.

By Order of the Board

For The Lakshmi Mills Co. Ltd.,

S. PATHY

Coimbatore Chairman and Managing Director

13^th August, 2018 (DIN 00013899)

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Mar 31, 2017

DIRECTORS’ REPORT

Ladies and Gentlemen,

The Directors have pleasure in presenting the Hundred and Seventh year Annual Report together with the audited accounts of the Company for the year ended 31.03.2017.

WORKING RESULTS No. of days worked Sales Other income		31.3.2017 357 22,745.05 728.45		('' in Lakhs) 31.3.2016 357 1 9,91 9.71 452.79
GROSS REVENUE		23,473.50		20,372.50
Profit before Tax and Exceptional Items Less : Exceptional items		472.40 17.65		184.28 37.15
Profit before Taxation Less : Current Tax MAT Credit entitlement	63.11 (61.24)	454.75	1.28 (1.28)	147.13
Net Current Tax Prior Year Taxes Deferred Tax Liability		1.87 3.92 333.84		0.87 41.45
NET PROFIT Add : Carry forward Profit		115.12 1,365.66 1,480.78		104.81 1,336.19 1,441.00
Profit Available for appropriation
Appropriation: General Reserve Proposed Dividend Corporate Tax on Dividend Balance carried forward		1,480.78		62.60 12.74 1,365.66
		1,480.78		1,441.00

The company proposes to retain an amount of Rs, 1,480.78 ( Rs, 1,365.66) Lakhs in the Profit & Loss Account. OPERATIONS

The Spindles capacity remained at the same level of 1.33 lakh spindles throughout the year 2016-17. Overall utilization remained around 95% - same as that of 2015-16.

Your Company continued to outsource fabrics both for exports as well as for domestic market. Export of yarn and fabric accounted for Rs, 5,318 Lakhs as against Rs, 4,780 Lakhs in the previous year, an increase of around 11% over the previous year’s performance.

Overall, the operational performance was better during the year, thanks to improvement in realization of yarn prices as well as power cost reduction.

There was no change in the nature of business of the Company during the financial year ended 31^st March, 2017. DIVIDEND

The Directors have recommended a dividend of Rs, 9/- per Equity Share of Rs, 100/- each, at 9% for the financial year 2016-2017 (Previous Year - 9%). The Dividend of 9%, if approved at the forth coming Annual General Meeting, will result in the out flow of Rs, 62.60 Lakhs to the company in addition to Rs, 12.74 Lakhs by way of dividend distribution tax.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

In terms of the Companies Act, 2013 any unclaimed or unpaid Dividend relating to the financial year 2009-10, will be transferred to the Investor Education and Protection Fund established by the Central Government, after the conclusion of this Annual General Meeting.

SHARE CAPITAL

The paid up Equity Share Capital as on March 31, 2017 was Rs, 6,95,55,000/- comprising 6,95,550 shares of Rs, 100/- each. During the year under review the company has not made any fresh issue of shares.

EXTRACT OF ANNUAL RETURN

As per the requirements of the Companies Act, 2013, the extract of annual return in the prescribed Form MGT 9 is annexed hereto as Annexure - 1 forming part of this report.

BOARD MEETINGS AND ITS COMMITTEES CONDUCTED DURING THE PERIOD UNDER REVIEW

During the year under review, 4 Meetings of the Board of Directors and 4 Meetings of the Audit Committee,

2 Meetings of the Nomination and Remuneration Committee, 1 Meeting of the Corporate Social Responsibility Committee and 1 Meeting of the Stakeholders Relationship Committee and 20 Meetings of the Share Transfer Committee were held. Further details of the same have been enumerated in the Corporate Governance Report annexed herewith.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirements under Section 134(3)(c) of the Companies Act, 2013, with respect to the Directors’ Responsibility Statement, it is hereby confirmed that-

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures from those standards;

(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 profit of the Company for that period;

(c) the Directors have taken proper and sufficient care for maintenance of adequate accounting records in accordance with the provisions of the Companies Act 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 laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143(12) OF THE COMPANIES ACT, 2013 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT

There were no instances of frauds identified or reported by the Statutory Auditors during the course of their audit pursuant to Section 143(12) of the Companies Act, 2013.

DECLARATION OF INDEPENDENT DIRECTORS

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to act as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

NOMINATION AND REMUNERATION COMMITTEE AND POLICY

The Company has reconstituted the Nomination and Remuneration Committee of Directors of the Company and its composition and attendance are reported elsewhere in the Annual Report. The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy on Directors’ appointment and remuneration including criteria for determining qualification, positive attributes, independence of a Director and other matters provided under sub-section (3) of Section 178. The said Policy is attached herewith as Annexure - 6 to this report and is also available on the website of the Company - www.lakshmimills.com.

EXPLANATION AND COMMENTS ON AUDITOR REPORTS

The reports of the Statutory Auditors M/s. Subbachar and Srinivasan (annexed elsewhere in the Annual Report) and that of the Secretarial Auditor Mr. M.D. Selvaraj, annexed hereto as Annexure - 2 are self explanatory having no adverse comments.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The Company has not given any loans or guarantees covered under the provisions of Section 186 of the Companies Act, 2013. The details of the investments made by the Company are given in the notes to the financial statements.

RELATED PARTY TRANSACTIONS

All transactions of the Company with the related parties were in the ordinary course of business and on an arm’s length pricing basis. Since there are no transactions which are not on arm’s length basis and material in nature, the requirement of disclosure of such related party transactions in Form AOC-2 does not arise.

The policy on Related Party Transactions as approved by the Board of Directors of the Company has been uploaded on the Company’s website and may be accessed through the link at www.lakshmimills.com.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There is no material change or commitments after the closure of the financial year as on 31.03.2017 and till the date of this report.

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

The information pertaining to conservation of energy, technology absorption, Foreign Exchange Earnings and Outgo as required under section 134 (3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is attached herewith as Annexure - 3 to this report.

RISK MANAGEMENT

The Company follows a comprehensive and integrated risk management process. The risk management process is designed to safeguard the organization from various risks through adequate and timely actions. It is designed to anticipate, evaluate and mitigate risks in order to minimize its impact on the business. The potential risks are inventoried and integrated with the management process such that they receive the necessary consideration during decision making and are periodically reviewed and revised by the Board of Directors.

CORPORATE SOCIAL RESPONSIBILITY

The Board has constituted a CSR Committee comprising of Sri S. Pathy, Sri Aditya Krishna Pathy and Sri D. Rajendran.

The Annual Report on Company’s CSR activities of the Company is furnished in the prescribed format as Annexure - 4 and attached to this report.

BOARD EVALUATION

Pursuant to the provisions of the Act, the Board has carried out an annual evaluation of its own performance, the individual Directors (including the Chairman) as well as an evaluation of the working of all Board Committees. The performance evaluation was carried out on the basis of inputs received from all the Directors / Members of the Committees, as the case may be. The Independent Directors of the Company have also convened a separate meeting for this purpose. All the results of evaluation has been communicated to the Chairman of the Board of Directors.

DIRECTORS & KEY MANAGERIAL PERSONNEL

In accordance with the provisions of Section 152 of the Act and the Articles of Association of the Company, Sri R. Santharam, Director is liable to retire by rotation at the ensuing Annual General Meeting (“AGM”) and being eligible offers himself for re-appointment.

Your directors recommend the re-appointment.

Sri V. S. Velayutham, Independent Director has resigned from the Board of Directors of the Company with effect from 21.04.2016.

Key Managerial Personnel of the Company as required pursuant to Section 2(51) and 203 of the Companies Act, 2013 are Sri S. Pathy - Chairman and Managing Director, Sri Aditya Krishna Pathy - Deputy Managing Director, Sri N. Singaravel - Company Secretary and Sri V. Kannappan - Chief Financial Officer.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any joint venture, subsidiary or associate company.

FIXED DEPOSITS

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has adequate internal control systems to monitor business processes, financial reporting and compliance with applicable regulations. The systems are periodically reviewed for identification of control deficiencies and formulation of time bound action plans to improve efficiency at all the levels. The Audit Committee of the Board constantly reviews internal control systems and their adequacy, significant risk areas, observations made by the internal auditors on control mechanism and the operations of the Company and recommendations made for corrective action through the internal audit reports. The Committee reviews the statutory auditors’ report, key issues, significant processes and accounting policies.

AUDITORS STATUTORY AUDITORS

M/s. Subbachar & Srinivasan (Firm Registration No.004083S), Chartered Accountants, Statutory Auditors of the Company were appointed as statutory auditors in the 104^th Annual General Meeting to hold office till the conclusion of the 107th Annual General Meeting.

As per Companies Act, 2013, M/s. Subbachar & Srinivasan have completed their term of office and are not eligible for re-appointment. Based on the recommendation of the Audit Committee, the Company seeks approval for the appointment of M/s. M.S.Jagannathan & Visvanathan (Firm Registration No. 001209S), Chartered Accountants, Coimbatore, as statutory auditors of the company to hold office from the conclusion of this 107^th Annual General Meeting upto the conclusion of the 112^th Annual General Meeting to be held in 2021-2022. There are no qualifications or reservations or remarks made by the auditors in their report.

SECRETARIAL AUDITORS

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. M.D.Selvaraj, MDS & Associates, Company Secretary in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit report is annexed herewith as Annexure - 2.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the Directors on the recommendation of the Audit Committee have appointed M/s. A.R.Ramasubramania Raja & Co., a firm of Cost Accountants, as the Cost Auditor of the Company for the financial year 2017 - 18.

Pursuant to Section 148 of the Companies Act 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the remuneration payable to the Cost Auditors for the financial year 2016-17 & 2017 - 18 is subject to the approval of the shareholders in a general meeting. The Board recommends the ratification of their remuneration.

CORPORATE GOVERNANCE

Pursuant to Regulation 34 of the SEBI (LODR) Regulations, 2015, Management Discussion and Analysis Report, Report on Corporate Governance and Auditors Certificate regarding compliance of conditions of Corporate Governance provided elsewhere in this Report, forms part of the Directors’ Report.

COMPOSITION OF AUDIT COMMITTEE AND VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has reconstituted the Audit Committee of the Board of Directors of the Company and its composition and attendance are disclosed elsewhere in the Annual Report. The Company has devised a vigil mechanism in the form of a Whistle Blower Policy in pursuance of provisions of Section 177(10) of the Companies Act, 2013 and the policy is explained in corporate governance report and also posted on the website of company and can be accessed at the link http://www.lakshmimills.com. During the year under review, there were no complaints received under this mechanism.

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

The Company has in place a policy on Sexual Harassment of Women at Workplace in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Compliant Committee has been set up to redress complaints received. All employees (permanent, contractual, temporary, trainees) are covered under this policy. There were no complaints received from any employee during the financial year 2016 - 17.

PARTICULARS OF EMPLOYEES

Disclosures with respect to the remuneration of Directors and employees as required under Section 197(12) of Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,

2014 has been appended as Annexure - 5 to this Report.

ACKNOWLEDGEMENT

The Board acknowledges the continued assistance from the Bankers, Cotton, Yarn and Cloth Dealers of the Company and Shareholders and appreciates the valuable services rendered by the employees at all levels.

May the Goddess Lakshmi continue to shower her choicest Blessings for the prosperity of the Company in the years to come.

By Order of the Board

For The Lakshmi Mills Co. Ltd.,

S. PATHY

Coimbatore Chairman and Managing Director

25^th May, 2017 (DIN 00013899)

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Mar 31, 2016

Ladies and Gentlemen,

The Directors have pleasure in presenting the Hundred and Sixth year Annual Report together with the audited accounts of the Company for the year ended 31.03.2016.

			(Rs. in lakhs)
WORKING RESULTS	31.3.2016		31.3.2015
No. of days worked	357		358
Sales	19,919.71		22,130.01
Other income	452.79		625.23
GROSS REVENUE	20,372.50		22,755.24
Profit before Tax and	184.28		567.71
Exceptional Items
Less : Exceptional items	37.15		284.81
Profit before Taxation	147.13		282.90
Less : Current Tax 1.28		45.26
MAT Credit entitlement (1.28)		(44.14)
Net Current Tax	-		1.12
Prior Year Taxes	0.87		(17.91)
Deferred Tax Liability / (Asset)	41.45		(129.39)
NET PROFIT	104.81		429.08
Add : Carried forward Profit	1,336.19		1,117.24
	1,441.00		1,546.32
Less: Write down of carrying amount of assets	-		34.56
Available for appropriation	1,441.00		1,511.76
Appropriation:
General Reserve	-		50.00
Proposed Dividend	62.60		104.33
Corporate Tax on Dividend	12.74		21.24
Balance carried forward	1,365.66		1,336.19
	1,441.00		1,511.76

The company proposes to retain an amount of Rs. 1,365.66 lakhs in the Profit & Loss Account.

OPERATIONS

The Spindles capacity remained at the same level of 1.33 lakh spindles throughout the year 2015-16. Overall utilization remained around 95% - same as that of 2014-15.

Your Company continued to outsource fabrics both for exports as well as for domestic market. Export of yarn and fabric accounted for Rs. 4,780 Lakhs as against Rs. 4,392 Lakhs in the previous year, an increase of around 9% over the previous year’s performance.

Though the operational performance of the Company in the fields of capacity utilization and productivity were more or less maintained at the level of last year’s achievement, there was a drop in the sales of about 10% due to lower realization of yarn sale price.

Higher cost of raw materials viz., Cotton and Polyester fibre coupled with lower prices of yarn resulted in the lower profitability in operations.

There was no change in the nature of business of the Company during the financial year ended 31^st March, 2016.

DIVIDEND

The Directors have recommended a dividend of Rs. 9/- per Equity Share of Rs. 100/- each, at 9% for the financial year 2015-2016 (Previous Year - 15%). The Dividend of 9%, if approved at the forth coming Annual General Meeting, will result in the out flow of Rs. 62.60 lakhs to the company in addition to Rs. 12.74 lakhs by way of dividend distribution tax.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

In terms of the Companies Act, any unclaimed or unpaid Dividend relating to the financial year 2008-09, will be transferred to the Investor Education and Protection Fund established by the Central Government, after the conclusion of this Annual General Meeting.

SHARE CAPITAL

The paid up Equity Share Capital as on March 31, 2016 was Rs. 6,95,55,000/- comprising 6,95,550 shares of Rs. 100/- each. During the year under review the company has not made any fresh issue of shares.

EXTRACT OF ANNUAL RETURN

As per the requirements of the Companies Act, 2013, the extract of annual return in the prescribed Form MGT 9 is annexed hereto as Annexure - 1 forming part of this report.

BOARD MEETINGS AND ITS COMMITTEES CONDUCTED DURING THE PERIOD UNDER REVIEW

During the year under review, 4 Meetings of the Board of Directors and 4 Meetings of the Audit Committee, 3 Meetings of the Nomination and Remuneration Committee, 1 Meeting of the Corporate Social Responsibility Committee and 1 Meeting of the Stakeholders Relationship Committee and 16 Meetings of the Share Transfer Committee were held. Further details of the same have been enumerated in the Corporate Governance Report annexed herewith.

DIRECTORS'' RESPONSIBILITY STATEMENT

The Directors confirm that -

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures from those standards.

(b) they 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 profit of the Company for that period;

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

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

(e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143(12) OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT

There were no instances of frauds identified or reported by the Statutory Auditors during the course of their audit pursuant to Section 143(12) of the Companies Act, 2013.

DECLARATION OF INDEPENDENT DIRECTORS

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to act as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

NOMINATION AND REMUNERATION COMMITTEE AND POLICY

As per the requirements of the provisions of the Companies Act, 2013, a Nomination and Remuneration Committee of Directors was constituted by the Board of Directors and the details of the Members of the Committee are disclosed elsewhere in this Annual Report. The Board has, on the recommendation of the Nomination and Remuneration Committee framed a policy on Directors’ appointment and remuneration including criteria for determining qualification, positive attributes, independence of a Director and other matters provided under sub-section (3) of Section 178. The said Policy is available on the website of the Company - www.lakshmimills.com.

EXPLANATION AND COMMENTS ON AUDITOR REPORTS

The reports of the Statutory Auditors (annexed elsewhere in the Annual Report) and that of the Secretarial Auditors (annexed hereto as Annexure - 2) are self explanatory having no adverse comments.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013. The details of the investments made by company are given in the notes to the financial statements.

RELATED PARTY TRANSACTIONS

All transactions of the Company with the related parties were in the ordinary course of business and on an arm’s length pricing basis. Since there are no transactions which are not on arm’s length basis and material in nature the requirement of disclosure of such related party transactions in Form AOC-2 does not arise.

The policy on Related Party Transactions as approved by the Board of Directors of the Company has been uploaded on the Company’s website and may be accessed through the link at www.lakshmimills.com.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There is no material change or commitments after the closure of the financial year as on 31.03.2016 and till the date of this report.

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

The information pertaining to conservation of energy, technology absorption, Foreign Exchange Earnings and Outgo as required under section 134 (3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is attached herewith as Annexure - 3 to this report.

RISK MANAGEMENT

The Company follows a comprehensive and integrated risk management process. The risk management process is designed to safeguard the organization from various risks through adequate and timely actions. It is designed to anticipate, evaluate and mitigate risks in order to minimize its impact on the business. The potential risks are inventoried and integrated with the management process such that they receive the necessary consideration during decision making and are periodically reviewed and revised by the Board of Directors.

CORPORATE SOCIAL RESPONSIBILITY

The Board has constituted a CSR Committee comprising of Sri S.Pathy, Sri Aditya Krishna Pathy and Sri D.Rajendran.

The Annual Report on Company’s CSR activities of the Company is furnished in the prescribed format as Annexure - 4 and attached to this report.

BOARD EVALUATION

Pursuant to the provisions of the Act, the Board has carried out an annual evaluation of its own performance, the individual Directors (including the Chairman) as well as an evaluation of the working of all Board Committees. The performance evaluation was carried out on the basis of inputs received from all the Directors / Members of the Committees, as the case may be. The Independent Directors of the Company have also convened a separate meeting for this purpose. All the results of evaluation has been communicated to the Chairman of the Board of Directors.

DIRECTORS & KEY MANAGERIAL PERSONNEL

In accordance with the provisions of Section 152 of the Act and the Articles of Association of the Company, Sri Aditya Krishna Pathy, Deputy Managing Director is liable to retire by rotation at the ensuing Annual General Meeting (“AGM”) and being eligible offers himself for re-appointment. Your directors recommend the re-appointment.

During the year under review, the members have approved the appointment of Smt Suguna Ravichandran as an Independent Director of the Company for a period of five years. Further the members have approved the re-appointment of Sri S.Pathy as Managing Director of the Company for a further period of 5 years with effect from 24.04.2016 and Sri Aditya Krishna Pathy as Deputy Managing Director of the Company for a further period of 5 years with effect from 30.07.2015.

Sri V. S. Velayutham, Independent Director has resigned from the Board of Directors of the Company with effect from 21.04.2016. The Board wishes to place on record its appreciation for the valuable services rendered by him during his tenure of office as Independent Director of the Company.

Key Managerial Personnel of the Company as required pursuant to Section 2(51) and 203 of the Companies Act, 2013 are Sri S.Pathy, Chairman and Managing Director, Sri Aditya Krishna Pathy, Deputy Managing Director, Sri N.Singaravel, Company Secretary and Sri V.Kannappan, Chief Financial Officer.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any joint venture, subsidiary or associate company.

FIXED DEPOSITS

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has adequate internal control systems to monitor business processes, financial reporting and compliance with applicable regulations. The systems are periodically reviewed for identification of control deficiencies and formulation of time bound action plans to improve efficiency at all the levels. The Audit Committee of the Board constantly reviews internal control systems and their adequacy, significant risk areas, observations made by the internal auditors on control mechanism and the operations of the Company and recommendations made for corrective action through the internal audit reports. The Committee reviews the statutory auditors’ report, key issues, significant processes and accounting policies.

AUDITORS STATUTORY AUDITORS

M/s.Subbachar & Srinivasan (Firm Registration No.004083S), Chartered Accountants have been appointed as statutory auditors of the company for a period of three years at the Annual General Meeting held on 15.09.2014. Accordingly, pursuant to Section 139 of the Companies Act, 2013, the ratification of appointment of Statutory Auditors is being sought from the shareholders of the Company at the ensuing Annual General Meeting. The auditors have consented and confirmed their eligibility and willingness to continue as Statutory Auditors of the Company.

SECRETARIAL AUDITORS

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Sri M.D.Selvaraj, MDS & Associates, Company Secretary in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit report is annexed herewith as Annexure - 2.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the Directors on the recommendation of the Audit Committee have appointed Sri A.R.Ramasubramania Raja, of M/s. A.R.Ramasubramania Raja & Co., a firm of Cost Accountants, as the Cost Auditor of the Company for the financial year 2016 - 17.

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the remuneration payable to the Cost Auditors for the financial year 2015 - 16 & 2016 - 17 is subject to the approval of the shareholders in the general meeting. The Board recommends the ratification of their remuneration.

CORPORATE GOVERNANCE

Pursuant to Regulation 34 of the SEBI (LODR) Regulations, 2015, Management Discussion and Analysis Report, Report on Corporate Governance and Auditors Certificate regarding compliance of conditions of Corporate Governance provided elsewhere in this Report, forms part of the Directors’ Report.

COMPOSITION OF AUDIT COMMITTEE AND VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Board has constituted an Audit Committee, details of which are enumerated in the Corporate Governance Report. The Company has devised a vigil mechanism in the form of a Whistle Blower Policy in pursuance of provisions of Section 177(10) of the Companies Act, 2013 and the policy is explained in corporate governance report and also posted on the website of company and can be accessed at the link www.lakshmimills.com. During the year under review, there were no complaints received under this mechanism.

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

The Company has in place a policy on Sexual Harassment of Women at Workplace in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Compliant Committee has been set up to redress complaints received. All employees (permanent, contractual, temporary, trainees) are covered under this policy. There were no complaints received from any employee during the financial year 2015 - 16.

PARTICULARS OF EMPLOYEES

Disclosures with respect to the remuneration of Directors and employees as required under Section 197 of Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been appended as Annexure - 5 to this Report.

ACKNOWLEDGEMENT

The Board acknowledges the continued assistance from the Bankers, Cotton, Yarn and Cloth Dealers of the Company and Shareholders and appreciates the valuable services rendered by the employees at all levels.

May the Goddess Lakshmi continue to shower her choicest Blessings for the prosperity of the Company in the years to come.

By Order of the Board

For The Lakshmi Mills Co. Ltd.,

S. PATHY

Coimbatore Chairman and Managing Director

22.07.2016 (DIN 00013899

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Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting the Hundred and Fifth year Annual Report together with the audited accounts of the Company for the year ended 31.03.2015.

(Rs in lakhs)

WORKING RESULTS 31.3.2015 31.3.2014

No. of days worked 358 357

Sales 22,130.01 21,800.57

Other income 625.23 413.93

GROSS REVENUE 22,755.24 22,214.50

Profit before Tax and 567.71 258.95 Exceptional Items

Add / (Less): Exceptional items (284.81) 731.14

Profit before Taxation 282.90 990.09

Less : Current Tax 45.26 225.02

MAT Credit entitlement (44.14) (216.74)

Net Current Tax 1.12 8.28

Prior Year Taxes (17.91) 203.17

Deferred Tax Credit (Net) (129.39) (161.31)

NET PROFIT 429.08 939.95

Add : Carry forward Profit 1,117.24 349.35

1,546.32 1,289.30

Less: Written down of carrying 34.56 - amount of assets

Available for appropriation 1,511.76 1,289.30

Appropriation:

General Reserve 50.00 50.00

Proposed Dividend 104.33 104.33

Corporate Tax on Dividend 21.24 17.73

Balance carried forward 1,336.19 1,117.24 1,511.76 1,289.30

An amount of Rs.50 lakhs has been transferred to the General Reserves and an amount of Rs.1,336.19 Lakhs has been retained in the Profit & Loss account.

OPERATIONS

The Spindles capacity remained at the same level of 1.33 lac spindles throughout the year 2014-15. Overall utilisation remained around 95% - same as that of 2013-14.

Your Company continued to outsource fabrics both for exports as well as for domestic markets. Export of yarn and fabric accounted for Rs. 4392 lakhs as against Rs. 1661 lakhs of previous year. The increase was around 164% over previous year performance.

The Operational Performance of the Company in the fields of capacity utilisation, productivity and sales realisation were more or less maintained at the levels of last year''s achievement.

Easy availability of raw materials both Cotton and Polyester fibre throughout the year coupled with relatively favourable market conditions enabled your Company to have a healthy trend in its operations during the year.

DIVIDEND

The Directors have recommended a dividend of Rs. 15/- per Equity Share of Rs. 100/- each, at 15% for the financial year 2014-2015 (Previous Year - 15%). The Dividend of 15%, if approved at the forth coming Annual General Meeting, will result in the out flow of Rs. 104.33 lakhs to the company in addition to Rs. 21.24 lakhs by way of dividend distribution tax.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

In terms of the Companies Act, any unclaimed or unpaid dividend relating to the financial year 2007-08, will be transferred to the Investor Education and Protection Fund established by the Central Government, after the conclusion of this Annual General Meeting.

SHARE CAPITAL

The paid up Equity Share Capital as on March 31, 2015 was Rs.6,95,55,000/- comprising 6,95,550 shares of Rs. 100/- each. During the year under review the company has not made any fresh issue of shares.

EXTRACT OF ANNUAL RETURN

As per the requirements of the Companies Act, 2013, the extract of annual return in the prescribed Form MGT 9 is annexed hereto as Annexure - 1 forming part of this report.

BOARD MEETINGS AND ITS COMMITTEES CONDUCTED DURING THE PERIOD UNDER REVIEW

During the year under review, 4 Meetings of the Board of Directors, 4 Meetings of the Audit Committee, 3 Meetings of the Nomination and Remuneration Committee, 1 Meeting of the Corporate Social Responsibility Committee and 1 Meeting of the Stakeholders Relationship Committee were held. Further details of the same have been enumerated in the Corporate Governance Report annexed herewith.

DIRECTORS'' RESPONSIBILITY STATEMENT

The Directors confirm that -

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures from those standards.

(b) they 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 profit of the Company for that period;

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

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

(e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143(12) OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT

There were no instances of frauds identified or reported by the Statutory Auditors during the course of their audit pursuant to Section 143(12) of the Companies Act, 2013.

DECLARATION OF INDEPENDENT DIRECTORS

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under both the Companies Act, 2013 and Clause 49 of the Listing Agreement with the Stock Exchanges.

NOMINATION AND REMUNERATION COMMITTEE AND POLICY

As per the requirements of the provisions of the Companies Act, 2013, a Nomination and Remuneration Committee was constituted by the Board of Directors and the details of the Members of the Committee are disclosed elsewhere in this Annual Report. The Board has, on the recommendation of the Nomination and Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The said Policy is annexed hereto as Annexure - 2 forming part of the Board''s Report and the same can also be accessed on the Company''s website in the link http://www.lakshmimills.com/policies.html#

EXPLANATION AND COMMENTS ON AUDITOR REPORTS

The reports of the Statutory Auditors (annexed elsewhere in the Annual Report) and that of the Secretarial Auditors (annexed hereto as Annexure - 3) are self explanatory having no adverse comments.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The company has not given any loans or guarantees covered under the provisions of Section 186 of the Companies Act, 2013. The details of the investments made by company are given in the notes to the financial statements.

RELATED PARTY TRANSACTIONS

All transactions entered into with related parties as defined under the Companies Act, 2013 and Clause 49 of the Listing Agreement during the financial year 2014-15 were in the ordinary course of business and on an arm''s length pricing basis. Since there are no transactions which are not on arm''s length basis and material nature the requirement of disclosure of such related party transactions in Form AOC-2 does not arise.

The Policy on Related Party Transactions as approved by the Board of Directors of the Company has been uploaded on the Company''s website and may be accessed through the link at http://www.lakshmimills.com/policies.html#

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There is no material change or commitments after the closure of the financial year as on 31.03.2015 and till the date of this report.

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

The information pertaining to conservation of energy, technology absorption, Foreign Exchange Earnings and Outgo as required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is attached herewith as Annexure 4 to this report.

RISK MANAGEMENT

The Company has a structured risk management policy. The risk management process is designed to safeguard the organization from various risks through adequate and timely actions. It is designed to anticipate, evaluate and mitigate risks in order to minimize its impact on the business. The potential risks are inventoried and integrated with the management process such that they receive the necessary consideration during decision making.

CORPORATE SOCIAL RESPONSIBILITY

The Board has formed a Corporate Social Responsibility Committee comprising of Sri.S.Pathy, Sri.Aditya Krishna Pathy and Sri.D.Rajendran.

The Committee at its meeting held on 11th February, 2015, recommended a CSR policy for adoption by the Company in line with the provisions of Schedule VII of the Companies Act, 2013.

The CSR policy deals with allocation of funds, activities, identification of programmes, approval, implementation, monitoring and reporting mechanisms for CSR activities.

The Annual Report on Company''s CSR activities of the Company is furnished in the prescribed format as Annexure 5 and attached to this report.

BOARD EVALUATION

Pursuant to the provisions 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, the directors individually as well as the evaluation of the working of its Audit and Nomination & Remuneration Committees. The Independent Directors of the Company have also convened a separate meeting for this purpose. All the results and evaluation has been communicated to the Chairman of the Board of Directors. All the Directors of the Board are familiar with the business of the Company.

DIRECTORS & KEY MANAGERIAL PERSONNEL

At the 104th Annual General Meeting of the company held on 15th September, 2014 the company had appointed Sri.V.Jagannathan, Sri.D.Rajendran, Sri.Satish Ajmera and Sri.V.S.Velayutham as independent directors under the companies Act, 2013 to hold office for five consecutive years or the date of 109th Annual General Meeting, whichever is earlier.

Sri.Sanjay Jayavarthanavelu, Director retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment.

Smt.Suguna Ravichandran appointed as Additional Director of the Company with effect from 11.02.2015 holds office upto the date of this Annual General Meeting. Accordingly, necessary resolution proposing the appointment of Smt.Suguna Ravichandran as an Independent Director of the Company has been included in the Agenda of the Annual General Meeting for the approval of the Shareholders.

Your directors recommend their appointment/ re-appointment.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any joint venture or subsidiary company. However, the company has one associate company namely M/s. LCC Investments Limited.

A report containing the salient features of the associate as required under Section 129(3) of the Companies Act, 2013 has been annexed herewith in Form AOC-1 and is attached as Annexure 6 to this report

FIXED DEPOSITS

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. Further, all the deposits accepted prior to the commencement of the Companies Act, 2013, i.e., 01.04.2014, were fully repaid and no amount remains unpaid as on 31.03.2015.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has adequate internal control systems to monitor business processes, financial reporting and compliance with applicable regulations. The systems are periodically reviewed for identification of control

deficiencies and formulation of time bound action plans to improve efficiency at all the levels. The Audit Committee of the Board constantly reviews internal control systems and their adequacy, significant risk areas, observations made by the internal auditors on control mechanism and the operations of the Company and recommendations made for corrective action through the internal audit reports. The Committee reviews the statutory auditors'' report, key issues, significant processes and accounting policies.

AUDITORS

STATUTORY AUDITORS

M/s.Subbachar & Srinivasan (Firm Registration No.004083S), Chartered Accountants have been appointed as statutory auditors of the company for a period of three years at the Annual General Meeting held on 15.09.2014. Accordingly, pursuant to Section 139 of the Companies Act, 2013, the ratification of appointment of Statutory Auditors is being sought from the shareholders of the Company at the ensuing Annual General Meeting. The auditors have consented and confirmed their eligibility and willingness to continue as Statutory Auditors of the Company.

SECRETARIAL AUDITORS

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. M.D.Selvaraj, MDS & Associates, Company Secretary in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit report is annexed herewith as Annexure 3.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the Directors on the recommendation of the Audit Committee have appointed Sri A.R.Ramasubramania Raja, of M/s. A.R.Ramasubramania Raja & Co., a firm of Cost Accountants, as the Cost Auditor of the Company for the financial year 2015 - 16.

Pursuant to Section 148 of the Companies Act 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the remuneration payable to the Cost Auditors is subject to the approval of the shareholders in a general meeting. The Board recommends the ratification of their remuneration.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Management Discussion and Analysis Report, Report on Corporate Governance and Auditors Certificate regarding compliance of conditions of Corporate Governance provided elsewhere in this Report, forms part of the Directors'' Report.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has devised a vigil mechanism in the form of a Whistle Blower Policy in pursuance of provisions of Section 177(10) of the Companies Act, 2013 and the policy is explained in corporate governance report and also posted on the website of company and can be accessed at the link http://www.lakshmimills.com/policies.html#. During the year under review, there were no complaints received under this mechanism.

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

The Company has in place a policy on Sexual Harassment of Women at Workplace in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Compliant Committee has been set up to redress complaints received. All employees (permanent, contractual, temporary, trainees) are covered under this policy. There were no complaints received from any employee during the financial year 2014-15.

PARTICULARS OF EMPLOYEES

Disclosures with respect to the remuneration of Directors and employees as required under Section 197 of Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been appended as Annexure 7 to this Report.

ACKNOWLEDGEMENT

The Board acknowledges the continued assistance from the Bankers, Cotton, Yarn and Cloth Dealers of the Company, Shareholders and Depositors and appreciates the valuable services rendered by the employees at all levels.

May the Goddess Lakshmi continue to shower her choicest Blessings for the prosperity of the Company in the years to come.

By Order of the Board For The Lakshmi Mills Co. Ltd., S. PATHY Coimbatore Chairman and Managing Director 29th July, 2015 (DIN 00013899)

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Mar 31, 2014

Ladies and Gentlemen,

The Directors have pleasure in presenting the Hundred and Fourth year Annual Report together with the audited accounts of the Company for the year ended 31.03.2014.

(Rs. in lakhs)

WORKING RESULTS 31.3.2014 31.3.2013

No. of days worked 357 357 Sales 21,800.57 16,389.13 Other income 413.93 752.92

GROSS REVENUE 22,214.50 17,142.05

Profit/(Loss) before Tax, 258.95 382.30 Exceptional Items

Add: Exceptional items 731.14 117.03

Profit/(Loss) before Taxation 990.09 499.33

Less : Current Tax 225.02 41.62

MAT Credit entitlement (216.74) (38.48)

Net Current Tax 8.28 3.14

Prior Year Taxes 203.17 -

Deferred Tax Credit (Net) (161.31) (608.80)

NET PROFIT/(LOSS) 939.95 1,104.99

Add/(Less): Carry forward Profit /(Loss) 349.35 (627.98)

Available for appropriation 1,289.30 477.01

Appropriation:

General Reserve 50.00 30.00 Proposed Dividend 104.33 83.47 Corporate Tax on Dividend 17.73 14.19 Balance carried forward 1,117.24 349.35

1,289.30 477.01

OPERATIONS

There was a marginal increase of 2736 spindles in Palladam Unit bringing the total number of spindles operated to 1.33 lakhs as follows:

S. No Unit Spindles in lakhs

i) Palladam : 0.70

ii) Kovilpatti : 0.63

Total : 1.33

The operational performance of the Company during the year was satisfactory.

Thanks to the provision of separate electrical feeder lines in both the units during the year. Loss of utilization due to power shortage was overcome and that capacity utilization improved tremendously. The average utilization for the year was over 94%. This improved utilization had resulted in increased value of production of over 29% compared to the previous year.

Your Company continued to outsource fabrics both for exports and domestic markets. Export of yarn and fabrics accounted for over Rs. 21 Crores as against Rs. 13.64 Crores of previous year. The increase was around 50% over previous year''s performance.

Overall, the operational results of the Company improved considerably during the year and thanks for optimum capacity utilization, improved market conditions and increased exports.

CURRENT INDUSTRIAL TREND AND FUTURE PROSPECTS

Textile industry as a whole saw a better year in 2013-14, thanks to the availability of raw materials both in manmade fibres and cotton.

However due to general sluggishness in the manufacturing sector, much progress could not be made during the year. The Prospects for the textile industry looks promising provided we are able to compete in the highly competitive market.

OUTLOOK

Indian Textile Industry can look forward for robust growth in the years ahead. India is endowed with adequate quantity of raw materials both in cotton and manmade fibres. With a large reservoir of well qualified technicians and managerial personnel, it should be possible to take bigger share in the world market.

Our country reported to have attained No.2 status in the textile trade in the World - next to China. Plenty of opportunities are there to surge forward. One has to take right steps to move forward for further growth and consolidation.

Your Company will proceed in the right direction in the years ahead.

DIVIDEND

The Directors have recommended a dividend of Rs. 15/- per share (15%) for the financial year 2013-2014 (Previous Year - 12%).

DIRECTORS

Sri R. Santharam, Non - Independent Director and Sri V. S. Velayutham, Independent Director retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment.

In order to comply with the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, Sri V. Jagannathan, Sri D. Rajendran and Sri Satish Ajmera are proposed to be appointed as Independent Directors. The said Directors have consented to act as Independent Directors and in respect of whom nominations with requisite deposit have been received from the members.

A brief profile of the Directors retiring by rotation and seeking re-appointment, to be provided as per Clause 49 of the Listing Agreement is annexed to the Notice of Annual General Meeting.

DIRECTORS'' RESPONSIBILITY STATEMENT

In compliance with the provisions of Section 217(2AA) of the Companies Act, 1956, the Directors state that:

i. In the preparation of Statement of Profit and Loss for the period ended 31st March 2014 and the Balance Sheet as on that date all the applicable Accounting Standards have been followed.

ii. Accounting Policies, that are reasonable and prudent, have been selected and applied consistently 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 the profit of the Company for the year ended 31st March 2014.

iii. The accounting records in accordance with the provisions of the Companies Act, 1956 and for safeguarding the assets of the Company as also for preventing and detecting fraud and other irregularities, have been properly maintained and

iv. The Statement of Profit and Loss and Balance Sheet have been prepared on a going concern basis.

CORPORATE GOVERNANCE

Pursuant to clause 49 of the Listing Agreement with the Stock Exchanges, Management Discussion and Analysis Report, Report on Corporate Governance and Auditors Certificate regarding compliance of conditions of Corporate Governance are made part of the Annual Report.

FIXED DEPOSIT

The deposit amount of Rs. 15,05,000/- claimed and unpaid due to dispute between the legal heirs was paid to the legal heirs upon Order of the Principal District Court at Coimbatore. No amount remains unclaimed as on 31st March 2014.

AUDITORS

The Company''s Auditor M/s.Subbachar & Srinivasan are to retire at the ensuing Annual General Meeting. M/s. Subbachar & Srinivasan, Chartered Accountants are eligible for re-appointment.

GENERAL

The Company''s Assets have been adequately insured.

The particulars required to be furnished under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are set out separately and form part of this Report.

During the year under review, there was no employee drawing remuneration in excess of the amount prescribed under section 217 2(A) of the Companies Act, 1956.

ACKNOWLEDGEMENT

The Board acknowledges the continued assistance from the Bankers, Cotton, Yarn and Cloth Dealers of the Company, Shareholders and Depositors and appreciate the valuable services rendered by the employees at all levels.

May the Goddess Lakshmi continue to shower her choicest Blessings for the prosperity of the Company in the years to come.

By Order of the Board For The Lakshmi Mills Co. Ltd., Coimbatore S. PATHY 25th July, 2014 Chairman and Managing Director

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Mar 31, 2013

Ladies and Gentlemen,

The Directors have pleasure in presenting the Hundred and Third year Annual Report together with the audited accounts of the Company for the year ended 31.03.2013.

(Rs. in lakhs)

WORKING RESULTS 31.3.2013 31.3.2012

No. of days worked 357 357

Sales 16389.13 14942.38

Other income 752.92 853.97

GROSS SALES 17142.05 15796.35

Profit / (Loss) before Tax, Exceptional items 376.30 (1913.42)

Add : Exceptional items 123.03 -

Profit / (Loss) before Taxation 499.33 (1913.42)

Less: Current Tax 41.62

AAAT Credit Entitlement (38.48)

Net Current Tax 3.14 -

Deferred Tax Credit (Net) (608.80) (595.90)

NET PROFIT / (LOSS) 1104.99 (1317.52)

Less : Carry forward Profit / (Loss) (627.98) 689.54

Available for appropriation 477.01 (627.98)

Appropriation:

General Reserve 30.00 Nil

Proposed Dividend 83.47 Nil

Corporate Tax on Dividend 14.19 Nil

Balance carried forward 349.35 Nil

477.01

OPERATIONS

The Company continued to operate 1.31 lakhs spindles in Palladam and Kovilpatti units during the year as follows:-

S. No Unit Spindles in lakhs

i) Palladam : 0.68

ii) Kovilpatti : 0.63

Total : 1.31

Capacity utilization continued to suffer during the year also but at reduced levels compared to previous year. Overall, the operational performance was better during the year, thanks to improved production as well as improvement in realization of yarn prices. This has helped the Company to show improved operational results.

Your Company continued to outsource fabrics both for exports and domestic markets. However there was steep drop in exports due to global market conditions.

CURRENT INDUSTRIAL TREND AND FUTURE PROSPECTS

Thanks to better market conditions and stable raw material prices for a major part of the year, the textile industry as a whole heaved a sigh of relief. However, the much announced restructuring program did not benefit many as the conditions imposed were not at all workable. The units continued to suffer with no relief from financial institutions.

To tide over the continued crisis in power front due to unscheduled power cuts etc. your Company had gone in for dedicated power lines for both Kovilpatti and Palladam units. This would certainly give relief to the units from the unscheduled power interruptions.

OUTLOOK

Government of India has announced the extension of TUF Scheme for the 12th Plan period also. This may help the industry to modernize further to meet the challenges of the future.

The industry need to seriously draw up plans to overcome the ever increasing shortage of skilled labour and also to insulate against the rising energy cost.

DIVIDEND

The Directors have recommended a dividend of 12% for the financial year 2012-2013.

ACCOUNTING POLICY

Effective from 01.04.2012, the Company has with retrospective effect changed its method of providing depreciation on Plant / Electrical Equipments from ''Straight Line'' method to ''Written Down Value'' method, at the rates prescribed in Schedule XIV of the Companies Act, 1956. Management believes that this change will result in more appropriate presentation and will give a systematic basis of depreciation charge, representative of the time pattern in which the economic benefits will be derived from the use of these assets.

DIRECTORS

In accordance with the Companies Act, 1956, and the Articles of Association, Sri D. Rajendran and Sri V. Jagannathan, Directors retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment.

DIRECTORS'' RESPONSIBILITY STATEMENT

In compliance of Section 217(2AA) of the Companies Act, 1956, the Directors state that:

i. In the preparation of Statement of Profit and Loss for the year ended 31st March 2013 and the Balance Sheet as on that date all the applicable accounting standards have been followed.

ii. Accounting Policies, that are reasonable and prudent, have been selected and applied consistently 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 the profit of the Company for the year ended 31st March 2013.

iii. The accounting records in accordance with the provisions of the Companies Act, 1956 and for safeguarding the assets of the Company as also for preventing and detecting fraud and other irregularities, have been properly maintained and

iv. The Statement of Profit and Loss and Balance Sheet have been prepared on a going concern basis.

CORPORATE GOVERNANCE

Pursuant to clause 49 of the listing agreement with the stock exchanges, Management Discussion and Analysis Report, Report on Corporate Governance and Auditors Certificate regarding compliance of conditions of Corporate Governance are made part of the Annual Report.

FIXED DEPOSIT

The deposit amount of Rs. 15,05,000/- claimed remains unpaid due to dispute between the legal heirs and is pending before the Principal District Court at Coimbatore. No other amount remains unclaimed as on 31st March 2013.

AUDITORS

The Company''s Auditor M/s. Subbachar & Srinivasan are to retire at the ensuing Annual General Meeting.

M/s. Subbachar & Srinivasan, Chartered Accountants are eligible for re-appointment.

GENERAL

The Company''s Assets have been adequately insured.

The particulars required to be furnished under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules 1988 are set out separately and form part of this Report.

During the year under review, there was no employee drawing remuneration in excess of the amount prescribed under section 217 2(A) of the Companies Act, 1956.

ACKNOWLEDGEMENT

The Board acknowledges the continued assistance from the Bankers, Cotton, Yarn and Cloth Dealers of the Company, Shareholders and Depositors and appreciate the valuable services rendered by the employees at all levels.

May the Goddess Lakshmi continue to shower her choicest Blessings for the prosperity of the Company in the years to come.

By Order of the Board

For The Lakshmi Mills Co., Ltd.

Coimbatore S. PATHY

2nd August, 2013 Chairman and Managing Director

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Mar 31, 2012

The Directors have pleasure in presenting the Hundred and Second year Annual Report together with the audited accounts of the Company for the year ended 31.3.2012.

WORKING RESULTS 31.3.2012 31.3.2011

No. of days worked 357 356

(Rs. in lakhs)

Sales 14942.38 17583.28

Other income 853.97 410.26

GROSS SALES 15796.35 17993.54

Profit / (Loss) before Tax, Exceptional items (1913.42) 384.17

Add : Exceptional items - -

Profit / (Loss) before Taxation (1913.42) 384.17

Less : Current Tax 54.07

MAT Credit Entitlement (48.83)

Deferred Tax Credit (Net) (595.90) (154.74) (149.50)

NET PROFIT / (LOSS) (1317.52) 533.67

Available for appropriation (1317.52) 533.67

Appropriation:

General Reserve Nil Nil

Proposed Dividend Nil 62.60

Corporate Tax on Dividend Nil 10.15

Balance carried forward Nil 460.92

- 533.67

OPERATIONS:

The Company continued to operate 1.31 lakhs spindles in Palladam and Kovilpatti units during the year as follows:- Spindles in lakhs

i) Palladam : 0.68

ii) Kovilpatti : 0.63

Total : 1.31

Due to unprecedented power cuts and restrictions on the use of electricity during peak hours every day for major part of the year, the overall capacity utilization suffered drastically.

Due to unprecedented rise and the subsequent steep fall in prices resulted in many mills forced to hold cotton at high prices over the market rates for substantial part of the year. Yarn prices were found unremunerative under such circumstances and that the mills did not go in for captive capacity to improve its utilization. The result was that the capacity utilization suffered severely, cash eroded in majority of the mills and that the operations had become very uneconomical.

Your Company was no exception and there was heavy erosion of Working Capital.

The Company continued to outsource fabrics both for exports and domestic markets. Your Company could export around 25 lakh metres of grey fabric valued at over Rs.29 Crores during the year. The Company hopes to continue this trend in the current year also.

CURRENT INDUSTRIAL TREND AND FUTURE PROSPECTS:

The Textile industry underwent one of the worst financial year in 2011-12. Due to production losses caused by unprecedented power cuts and restrictions, violent fluctuations in Raw Cotton prices - not witnessed earlier - resulted in most of the mills carrying huge inventory at prices more than the market rate. Operationally many mills have lost cash eroding their Working Capital.

The industry has represented to the Government of India for restructuring of the outstanding loans and that Government had since agreed to consider this on a case to case basis.

The Company hopes that Government of India will come up with concrete plans of action to bail out the ailing textile industry from the unprecedented crisis forced on it by various external factors.

OUTLOOK:

Government's positive proposals to bail out the ailing textile industry are eagerly awaited to proceed further.

In the context of finding skilled labour for the spinning industry, concrete plans of action are needed to go in for more of automation to reduce dependence of labour in the industry. Present wage structure in textile mills is not also quite attractive to retain labour. Industry need to think in this direction seriously.

DIVIDEND:

The directors have not recommended any dividend for the financial year 2011 -2012 due to severe recession in the industry and losses incurred by the Company.

DIRECTORS

In accordance with the Companies Act, 1956, and the Articles of Association, Sri. Satish Ajmera and Sri. Sanjay Jayavarthanavelu, Directors retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment.

DIRECTORS' RESPONSIBILITY STATEMENT

In compliance of Section 217(2AA) of the Companies Act, 1956, the Directors state that:

i. In the preparation of Statement of Profit and Loss for the year ended 31st March 2012 and the Balance Sheet as on that date all the applicable accounting standards have been followed.

ii. Accounting Policies, that are reasonable and prudent, have been selected and applied consistently 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 the loss of the Company for the year ended 31st March 2012.

iii. The accounting records in accordance with the provisions of the Companies Act, 1956 and for safeguarding the assets of the Company as also for preventing and detecting fraud and other irregularities, have been properly maintained and

iv. The Statement of Profit and Loss and Balance Sheet have been prepared on a going concern basis.

CORPORATE GOVERNANCE

Pursuant to clause 49 of the listing agreement with the stock exchanges, Management Discussion and Analysis Report, Report on Corporate Governance and Auditors Certificate regarding compliance of conditions of Corporate Governance are made part of the Annual Report.

FIXED DEPOSIT

The deposit amount of Rs.15,05,000/- claimed remains unpaid due to dispute between the legal heirs and is pending before the Principal District Court at Coimbatore. No other amount remains unclaimed as on 31st March 2012.

AUDITORS

The Company's Auditor M/s. Subbachar & Srinivasan are to retire at the ensuing Annual General Meeting and are eligible for re-appointment and necessary certificate has been received from them as required under Section 224(1B) of the Companies Act, 1956.

GENERAL

The Company's Assets have been adequately insured.

The particulars required to be furnished under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules 1988 are set out separately and form part of this Report.

During the year under review, there was no employee drawing remuneration in excess of the amount prescribed under section 217 2(A) of the Companies Act, 1956.

ACKNOWLEDGEMENT

The Board acknowledges the continued assistance from the Bankers, Cotton, Yarn and Cloth Dealers of the Company, Shareholders and Depositors and appreciate the valuable services rendered by the employees at all levels.

May the Goddess Lakshmi continue to shower her choicest Blessings for the prosperity of the Company in the years to come.

By Order of the Board

Coimbatore S. PATHY

1st August 2012 Chairman and Managing Director

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Mar 31, 2011

Ladies and Gentlemen,

The Directors have pleasure in presenting the Hundred and First year Annual Report together with the audited accounts of the Company for the year ended 31.03.2011.

WORKING RESULTS 31.03.2011 31.03.2010

No. of days worked 356 356

(Rs. in lakhs)

Sales 17445.35 13377.07

Other income 548.19 377.67

GROSS SALES 17993.54 13754.74

Profit / (Loss) before Tax, Exceptional items 384.17 (265.00)

Add : Exceptional items - 180.21

Profit / (Loss) before Taxation 384.17 (84.79)

Less : Current Tax 54.07 4.03

MAT Credit Entitlement (48.83) (4.03)

Deferred Tax Credit (Net) (154.74) (149.50) (228.62) (228.62)

NET PROFIT / (LOSS) 533.67 143.83

Add : Transfer from General Reserve - 157.79

Available for appropriation 533.67 301.62

Appropriation:

General Reserve Nil Nil

Proposed Dividend 62.60 62.60

Corporate Tax on Dividend 10.15 10.40

Balance carried forward 460.92 288.62

533.67 301.62

OPERATIONS:

During the year under report, the Company operated 1.31 lakh spindles in Palladam and Kovilpatti units as follows:-

Fig. in lakhs

i) -Palladam : 0.68

ii) Kovilpatti : 0.63

Total : 1.31

The Company was able to marginally increase its utilization levels in both the units in spite of encountering power cuts and power interruptions. Thanks to a phenomenal increase in yarn prices in the last quarter of the year, the Company could record a turnover of around Rs. 180 Crores - an increase of over 30% over the previous year.

The Company continued to outsource fabrics and export gainfully. During the year, fabric exports were to the order of Rs.15 Crores against Rs.6.5 Crores recorded during the preceding year. Overall the Company could export around Rs.21 Crores of yarn and fabrics during the year as against Rs.10 Crores done in 2009-10.

The Company hopes to export around Rs.25 Crores in the current year.

CURRENT INDUSTRIAL TREND AND FUTURE PROSPECTS

The Textile industry especially spinning segment saw a prosperous year in 2010-11. Unfortunately this euphoria appears to have been short lived and that the industry is in the midst of a severe crisis not witnessed during the last 20 years.

Raw material prices especially Cotton scaled new heights at the wrong time of the season due to mad rush for exports without taking care of the needs of the domestic segment. Repeated representations made by the industry not to allow Cotton exports at that point of time went unheeded. As usual speculators and traders made a killing by raising the prices to unprecedented levels - a rise of over 100% to 150% of last year price levels. Domestic segment which was forced to buy Cotton at these prices could increase their prices both in yarn and fabrics to unprecedented levels. Yarn and grey fabric prices reached an all time high between January'11 and March'11. No doubt, Mills made phenomenal profits in these months. However this trend could not be sustained.

The unprecedented rise in Cotton yarn prices in domestic segment forced the Government to ban Cotton yarn exports. Though this move had the desired result in bringing down the yarn prices, yet the consequences are far reaching. Sudden ban on Cotton yarn exports had resulted in foreign buyers diverting their procurement sources to other countries. Within the country, yarn stocks started accumulating and domestic segment is flooded with yarn. Yam prices began falling. The present scenario is that Raw Cotton prices had dropped down by over 40% over its peak level while yarn prices had gone down by over 25%. But there is no normal movement.

Both yam and cotton markets have become panicky and that there is more of instability. Sentiments all over is depressed and practically movement of yarn has come to a halt.

Every segment in Textile sector is saddled with serious problem - Cotton trade is unable to enforce the contracts concluded at peak prices while yarn prices had tumbled down both at domestic and international levels. Stocks started accumulating. High inventory levels are forcing the industry to cut down production. Inflationary pressures are not allowing cost of production to come down and substantial erosion in operations is seriously affecting the working of the units.

The first half of 2011-12 is going to be a bad period for the spinning mills. Your Company is not going to be an exception to this trend.

OUTLOOK

Domestic market offers huge demand potential. Export markets are also promising.

The industry needs to be cost effective and cost efficient to take advantage of the huge potential available.

Unfortunately, policies pursued by Government in allowing export of cotton and banning of cotton yarn exports - both at wrong times had spelt untold miseries to the industry. In their anxiety to protect one or the other segment in the industry, Government unwittingly had caused serious financial problems to the Textile industry as a whole. It will take considerable time to overcome the sufferings which the industry is facing.

DIVIDEND

Your directors have recommended a dividend of 9% for the year under report.

DIRECTORS

In accordance with the Companies Act, 1956, and the Articles of Association, Sri R. Santharam and Sri V.S. Velayutham, Directors retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment.

DIRECTORS' RESPONSIBILITY STATEMENT

In compliance of Section 217(2AA) of the Companies Act, 1956, the Directors state that:

i. In the preparation of Profit and Loss Account for the period ended 31st March 2011 and the Balance Sheet as on that date all the applicable accounting standards have been followed.

ii. Accounting Policies, that are reasonable and prudent, have been selected and applied consistently 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 the profit of the Company for the year ended 31st March 2011.

iii. The accounting records in accordance with the provisions of the Companies Act, 1956 and for safeguarding the assets of the Company as also for preventing and detecting fraud and other irregularities, have been properly maintained and

iv. The Profit and Loss Account and Balance Sheet have been prepared on a going concern basis.

CORPORATE GOVERNANCE

Pursuant to clause 49 of the listing agreement with the stock exchanges, Management Discussion and Analysis Report, Report on Corporate Governance and Auditors Certificate regarding compliance of conditions of Corporate Governance are made part of the Annual Report.

FIXED DEPOSIT

The deposit amount of Rs. 15,05,000/- claimed remains unpaid due to dispute between the legal heirs and is pending before the Principal District Court at Coimbatore. No other amount remains unclaimed as on 31st March 2011.

AUDITORS

The Company's Auditor M/s. Subbachar & Srinivasan are to retire at the ensuing Annual General Meeting.

M/s. Subbachar fit Srinivasan, Chartered Accountants are eligible for re-appointment.

GENERAL

The Company's Assets have been adequately insured.

The particulars required to be furnished under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are set out separately and form part of this Report.

During the year under review, there was no employee drawing remuneration in excess of the amount prescribed under section 217 2(A) of the Companies Act, 1956.

ACKNOWLEDGEMENT

The Board acknowledges the continued assistance from the Bankers, Cotton, Yarn and Cloth Dealers of the Company, Shareholders and Depositors and appreciate the valuable services rendered by the employees at all levels.

May the Goddess Lakshmi continue to shower her choicest Blessings for the prosperity of the Company in the years to come.

By Order of the Board

For THE LAKSHMI MILLS CO. LTD.

S. PATHY

Chairman and Managing Director

Coimbatore

29th July 2011

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Mar 31, 2010

The Directors have pleasure in presenting the Centenary year Annual Report together with the audited accounts of the Company for the year ended 31.03.2010.

WORKING RESULTS 31.03.2010 31.03.2009

No. of days worked 356 356

(Rs. in lakhs)

Sales 13377.07 10397.76

Other income 330.05 652.85

GROSS SALES 13707.12 11050.61

Profit / (Loss) before Tax, Exceptional items (265.00) (619.44)

Add : Exceptional items 180.21 (120.72)

Profit / (Loss) before Taxation (84.79) (740.16)

Less : Excess depreciation of earlier year withdrawn _ 84.82

Profit / (Loss) before Taxation (84.79) (655.34)

Less : Excess tax provision of earlier year reversed - (56.13)

Deferred Tax Credit (Net) (228.62) (422.28)

Fringe Benefit Tax - 9.00 (469.41)

NET PROFIT / (LOSS) : 143.83 (185.93)

Add : Transfer from General Reserve 157.79 226.62

Available for appropriation 301.62 40.69

Appropriation:

General Reserve Nil Nil

Proposed Dividend 62.60 34.78

Corporate Tax on Dividend 10.40 5.91

Balance carried forward 228.62 -

301.62 40.69

OPERATIONS:

During the year under report, the Company operated 1.29 lac spindles in Palladam and Kovilpatti units as follows:-

Fig. in lakhs

i) Palladam : 0.66

ii) Kovilpatti : 0.63

Total : 1.29

In spite of restrictions and control on the usage of grid power, thanks to the arrangement made with M/s.Sai Regency Power Corporation Pvt. Ltd for supply of gas power and also by operating captive diesel generating sets, the Company was able to achieve better production. The Company could record a turnover of around Rs.137 Crore - an increase of 25% over the previous year due to improved utilization of resources and better market conditions in the last quarter.

The Company has decided to give up the weaving activities and is in the process of disposing of weaving machines. Though the Company has given up the weaving activities, it continues to export cloth profitably by outsourcing. During the year, the company could achieve cloth sales of Rs.8.20 Crore including a export turnover of Rs.6.50 Crore. The Company is targeting around Rs.12 Crore of cloth sales in the current year.

The Company has exported Yarn and Cloth valued at Rs. 10.00 Crore during the year. It hopes to achieve around Rs. 15.00 Crore in current year.

CURRENT INDUSTRIAL TREND AND FUTURE PROSPECTS

The Textile Industry especially the spinning segment started looking up since the last quarter of the year under report, thanks to revival of demand from overseas markets. Cotton yarn prices touched record high during March and April 2010 compelling the Government to step in to regulate the prices of Yarn and Cotton as well as regulating export of Cotton and Yarn. Initially Government banned the-export of Cotton but later on introduced regulatory measures in regard to Cotton exports. Likewise export of Cotton yarn has been brought under registration system. Incentives given for Cotton yarn exports in the form of DEPB, Duty draw back etc. have been withdrawn. However the fact remains that the demand for Cotton yarn appears outstripping supply. Besides, there is lurking fear (which looks genuine) that required quantities of quality Cotton might not be available to the industry till the new crop arrives in October / November 2010. The Industry therefore feels that the Cotton prices might still go up in the next two to three months and that the spinning mills might have to bear the burden of high prices of cotton. In this context, scope for bringing down the Cotton yarn prices by regulatory measures by Government might not be effective.

The next four months looks to be more unpredictable and that only demand and supply is bound to influence the price level and that regulatory measures might not be effective.

Further costs of inputs are becoming increasingly high particularly raw materials, labour and power. There is very little control to manage costs in raw materials and power front. Only cost in labour can be controlled if productivity is improved. Textile Industry needs to improve labour productivity to become competitive in the global market. The present levels of productivity are not at all adequate and urgent steps are needed in this direction.

Your Company is therefore exploring all possibilities to improve labour productivity to be cost competitive.

The Company has resolved to go in for Property Development project with the land available in Coimbatore unit. Plans in this direction are being initiated.

30 employees opted for VRS during the year 2009-10. The number of employees on roll as on 31.03.10 were 2142 as against 1968 on 31.03.09. Due to better utilization of resources, the number of workers on roll had slightly gone up during the year. Efforts are being made to bring down this number to around 1900.

OUTLOOK

Domestic market offers huge demand potential in view of second largest populated country with largest young population, bubbling economy and expected double digit growth rate. India has second biggest world crop in Cotton. It has the skills to produce World Class cotton yarn for exports and also a reservoir of technical personnel to manage the units.

India has to look to control its costs to become cost competitive in world market. Policies of Government in the Raw material, finance, power and labour fronts need to be oriented so that the Industry is facilitated to achieve this.

DIVIDEND

Your directors have recommended a dividend of 9% for the year out of past reserves.

DIRECTORS

Dr. D. Jayavarthanavelu, Director passed away suddenly on 11.06.2010. The Board places on record its sincere appreciation of his valuable services rendered during the tenure of his office as Director of the Company.

Justice Sri. G. Ramanujam (Retd.), Director who is liable to retire by rotation at the ensuing Annual General Meeting has not opted for re-election due to his age. The Board has placed on record the valuable contributions made by him during his tenure as a Director. The Board has resolved not to fill the vacancy so caused at this time.

In accordance with the Companies Act, 1956 and the Articles of Association Sri V. Jagannathan and Sri D. Rajendran Directors retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment.

Sri. Satish Ajmera, who was on the Board as a nominee of LIC resigned with effect from 30.03.2010. He has been co-opted as Additional Director on the Board on 26.05.2010 and will be holding office until the ensuing Annual General Meeting.

Sri. Sanjay Jayavarthanavelu was co-opted as Additional Director on the Board on 30-07-2010 and will be holding office until the ensuing Annual General Meeting.

Notices have been received from members proposing the appointment of Sri Satish Ajmera and Sri Sanjay Jayavarthanavelu as Directors. Necessary resolutions are placed before the Annual General Meeting for their appointments.

Sri S. Pathys tenure of appointment as Managing Director expires on 23.04.2011. Resolution proposing his re-appointment as Chairman and Managing Director is placed at the ensuing Annual General Meeting.

Sri Aditya Krishna Pathy has been appointed as Whole Time Director on 30.07.2010. Resolution proposing his appointment as Whole Time Director is placed at the ensuing Annual General Meeting.

DIRECTORS RESPONSIBILITY STATEMENT

In compliance of Section 217(2AA) of the Companies Act, 1956, the Directors state that:

i. In the preparation of Profit and Loss Account for the period ended 31st March 2010 and the Balance Sheet as on that date all the applicable accounting standards have been followed.

ii. Accounting Policies, that are reasonable and prudent, have been selected and applied consistently 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 the profit of the Company for the year ended 31st March 2010.

iii. The accounting records in accordance with the provisions of the Companies Act, 1956 and for safeguarding the assets of the Company as also for preventing and detecting fraud and other irregularities, have been properly maintained and

iv. The Profit and Loss Account and Balance Sheet have been prepared on a going concern basis.

CORPORATE GOVERNANCE

Pursuant to clause 49 of the listing agreement with the stock exchanges, Management Discussion and Analysis Report, Report on Corporate Governance and Auditors Certificate regarding compliance of conditions of Corporate Governance are made part of the Annual Report.

FIXED DEPOSIT

There is a disputed claim since 11.09.2000 on the deposit amount of Rs. 15,05,000/- between the legal heirs and is pending before the Principal District Court at Coimbatore. No other amount remains unclaimed as on 31st March 2010.

AUDITORS

The Companys Auditors M/s.Subbachar & Srinivasan and M/s.Fraser & Ross are to retire at the ensuing Annual General Meeting.

M/s.Fraser & Ross expressed their inability to accept the re-appointment for the year 2010-2011 due to restriction on the number of audits that can be accepted by them. The Board placed on record the valuable services rendered by M/s.Fraser and Ross during the tenure of their office as Auditors of the Company.

M/s.Subbachar & Srinivasan, Chartered Accountants are eligible for re-appointment.

GENERAL

The Companys Assets have been adequately insured.

The particulars required to be furnished under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules 1988 are set out separately and form part of this Report.

During the year under review, there was no employee drawing remuneration in excess of the amount prescribed under section 217 2(A) of the Companies Act, 1956.

ACKNOWLEDGEMENT

The Board acknowledges the continued assistance from the Bankers, Cotton, Yarn and Cloth Dealers of the Company, Shareholders and Depositors and appreciate the valuable services rendered by the employees at all levels.

May the Goddess Lakshmi continue to shower her choicest Blessings for the prosperity of the Company in the years to come.

By Order of the Board

For THE LAKSHMI MILLS CO. LTD.

Coimbatore s. PATHY

30th July 2010 Chairman and Managing Director