Directors Report of National Fittings Ltd.

Mar 31, 2025

Your Directors have pleasure in presenting the Thirty Two Annual Report together with the Audited Balance
Sheet & Profit and Loss Account for the year ended 31.03.2025.

FINANCIAL RESULTS

The operating results for the year 2024-2025 are given below :

('' in Lakhs)

Profit before Interest and Depreciation and Other adjustments		3006.02
Less : Interest	87.46
Depreciation	295.00	382.46
Net Profit before Tax		2623.56
Provision for Tax :
Current Tax	246.70
MAT Credit	—
Deferred Tax (income) / expenses	46.52	293.22
Net Profit after Tax		2330.34
Amount brought forward from previous year		3352.57
Amount available for appropriation		5682.91
Appropriations Dividend on Equity Shares		136.25
Other Comprehensive Income (Net of Tax)		31.34
Surplus carried over to Balance Sheet		5515.32

FINANCIAL PERFORMANCE:

The Company''s income for the financial year ended 31st March, 2025 was Rs. 8109.95 lacs compared
to Rs. 7801.56 lacs in the previous year. The profit before tax for the Company is Rs 2623.56. lacs as
against Rs. 802.45 lacs in the previous year. The depreciation for the year is Rs 295.00 lacs compared
to Rs. 345.67 lacs in the previous year. After providing Taxation, the Company''s net profit stands at
Rs 2330.34 lacs as against Rs. 584.19 lacs in the previous year.

An amount of Rs 5515.32 lacs is to be carried over to Balance Sheet.

The Net worth of the company is at Rs. 8097.58 lacs as on 31.03.2025 as against Rs. 5,934.82 lac in
the previous year.

DIVIDEND

The Board of Directors has recommended a dividend of Re 1/- per Equity shares on 90,83,182 Equity
shares of Rs 10/- each aggregating to Rs 90.83 lacs for the financial year ended 31.03.2025, (Previous
year - Rs 136.25 lacs) which if approved by the shareholders in the ensuing Annual General Meeting
will be paid to all the Equity shareholders, whose name appear in the Register of Members as on
12th September, 2025 and will be paid to the shareholders on or before 15.10.2025.

PERFORMANCE:

The company has started taking steps towards consolidation and purchasing some components.

As part of consolidation one factory unit at Thekkalur has been sold for a consideration of Rs 28 crores
and our Dindigul Foundry operations are now shifted to our Vedasandur Foundry Division with effect
from 16.06.2024

We expect this to have a positive impact on efficiency and increase cost savings.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Despite a decrease in the sales turnover of the company, we have focused on profitability and increased
the PBT significantly to 10% vs 7.5% over the previous year.

Performance

FY 24-25 was a year of disciplined execution and balance-sheet strengthening. On a standalone basis,
Total Income from Operations was Rs.81.10 crore, representing a growth of 6% compared to Rs 76.53
crore in FY 23-24.

Profit from operations (before exceptional items) stood at Rs 7.02 crore, translating to an operating
margin of (-)8.7%, an improvement over FY 23-24 levels.

After accounting for exceptional gains from asset monetisation, reported PBT was Rs 26.24 crore, a
growth of 284% , while PAT was Rs 23.30 crore, up 299% from Rs 5.84 crore in FY 23-24, translating
to an EPS of Rs 25.66 up from. Rs 6.43 in FY 23-24.

ROE improved sharply to 28.78% in FY 24-25 (8.6% in FY 23-24). Interest costs remained modest at
1.1% of operating revenue, and employee costs stable at 12.3%, reflecting efficiency gains.

Consolidation & Exceptional Items

The Company completed the sale of the Thekkalur unit (Rs 28 crore) and Dindigul operations (Rs 13.5
crore) for a total consideration of Rs 41.5 crore. The profit on disposal was recognised as exceptional
income in FY 24-25.

Production continuity was maintained by relocating capacities to our Vedasandur Foundry Division.
Profitability Drivers

Product mix & realisations: Larger-sized fittings and niche products supported 5-7% higher export
realisations Year on Year.

Cost management: Improved yields, tighter working capital, and reduced finance costs lifted underlying
margins (from 7.5% PBT margin in FY 23-24 to 8.7% operating margin in FY 24-25).

Exceptional gains: Overall PBT margin stood at 32.3% in FY 24-25 due to asset monetisation.

Market Environment

Despite geopolitical disruptions in the Middle East and global election-related slowdowns, the Company
recorded 6% revenue growth, reflecting resilience in both export and domestic markets.

Future Outlook

Looking ahead, the Company remains focused on sustaining high-single-digit operating margins (ex¬
exceptional) and achieving steady revenue growth through new product introductions, stronger domestic
penetration, and export diversification.

Promoter Transition

The promoter change has been formally announced and is currently awaiting regulatory clearance. The
incoming promoters bring over 40 years of experience in the pipe fittings casting business, directly aligned
with our major raw material requirement. Their induction is expected to:

- Strengthen raw material security and cost stability through backward integration, reducing long-term
input volatility.

- Improve profitability via assured quality castings and process efficiencies.

- Provide synergies in supply and customer networks, accelerating domestic and export reach.

- I nfuse fresh strategic vision and capital strength to support investments in machining, assembly,
and new product lines.

This transition positions National Fittings Ltd. for stronger, sustainable growth and improved competitiveness.
SIGNIFICANT CHANGES

Operating profit and net profit margin increased over previous year due to increase in selling prices in
the export and domestic markets and sale of assets.

Capital expenditure to the extent of 7.51 Crores was done during the year in the infrastructure and on
Valve design, machines, tooling.

Debtors, Inventories, turnover ratio, current sale ratio and debt equity ratio has not changed significantly
over the previous year.

Return on Net Worth was affected compared to previous year. Ratios are detailed in Note 2.31 of the
Notes to the Financial Statements.

RISK MANAGEMENT AND FUTURE OUTLOOK
Tariff Developments:

The recent imposition of tariffs on competing suppliers could alter competitive dynamics in certain
markets. While this may create opportunities, competitor reactions and pricing strategies could also
affect demand patterns. We are monitoring the situation closely and will adapt our pricing and sourcing
strategies as needed.

- Geopolitical Risks: Conflicts in the Middle East and global political uncertainty continue to affect
infrastructure spending.

- Supply Chain: We continue to mitigate shipping and logistics risks through higher buffer stocks and
alternate routing.

Conclusion

- With revenue growth of 6% Year on Year, PAT growth of nearly 300% YoY, stronger balance sheet,
and a promoter transition backed by deep casting expertise, National Fittings Ltd. is well-positioned
to sustain profitability in the near term and capture stronger growth opportunities in the medium
term, while carefully navigating external risks such as tariffs and global demand volatility.

Mr Jayaram Govindarajan, Director, who retires by rotation, and being eligible, offered himself for
reappointment.

The term of the Independent Director Mr R Alagar ended on 13.08.2024.

Mr Jayaram Govindarajan has been appointed as Managing Director with effect from 24.07.2024
KEY MANAGEMENT PERSONNEL

The following persons are the Key Management Personnel as per the provisions of the Companies Act,
and rules made there under:-

Mr Jayaram Govindarajan	Managing Director
Mrs Panath Anitha	Whole Time Director
Mr J Saravanan	Chief Financial Officer
Mr S Aravinthan	Company Secretary

DIRECTORS'' RESPONSIBILITY STATEMENT

Your Directors further report that

(i) in the preparation of annual accounts, the applicable accounting standards have been followed and
there were no material departures;

(ii) the accounting policies selected have been applied consistently, prudent judgments and estimates
have been made to give a true and fair view of the state of affairs of the company as at
31.03.2025 and of the Profit of the company and the cash flow statement for the year ended
31.03.2025.

(iii) they 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 annual accounts have been prepared on a going concern basis.

(v) the directors, had laid down internal financial controls to be followed by the company and that such
internal financial controls are adequate and were operating effectively. Internal financial control
means the policies and procedures adopted by the Company for ensuring the orderly and efficient
conduct of its business including adherence to Company''s policies, the safeguarding of its assets,
the prevention and detection of frauds and errors, the accuracy and completeness of the accounting
records and the timely preparation of reliable financial information.

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

CODE OF CONDUCT

All Directors and Senior Management of the Company have affirmed Compliance with the Code of

Conduct of National Fittings Limited for the financial Year ended 31st March 2025.

The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements
as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed
as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

NUMBER OF BOARD MEETINGS

During the year, 4 (Four) Board Meetings were convened and held, the details of which are given in the
Corporate Governance Report.

POLICY ON DIRECTOR''S APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FOR
DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES, INDEPENDENCE OF A DIRECTOR, KEY
MANAGEMENT PERSONNEL AND OTHER EMPLOYEES

The Company shall have such person on the Board who complies with the requirements of the Companies
Act, 2013. Directors/KMPs shall be persons of sound integrity and honesty, apart from knowledge,
experience etc in the respective fields.

Composition of the Board shall be in compliance with the requirements of the Companies Act, 2013. No
person less than the age of 21 years shall be appointed as the director of the Board.

The Executive Directors are paid with remuneration as approved by the members but are not paid sitting
fees. Independent directors are not entitled for ESOPs.

MANNER IN WHICH FORMAL ANNUAL EVALUATION HAS BEEN MADE BY THE BOARD OF ITS
OWN PERFORMANCE AND THAT OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS

1. Nomination and Remuneration Committee of the Board prepared and sent through its Chairman draft
feedback form for evaluation of the Board and Independent Directors.

2. Independent Directors at a meeting of themselves considered and evaluated the performance of the
Board, performance of the Chairman and other Non-Independent Directors.

3. The Board subsequently evaluated performance of the Board, the Committees and Independent
Directors.

SHARES

There was no issue of fresh Equity Shares during the financial year. No Bonus Shares were issued.
The Company has not issued any Sweat Equity Shares and not provided any Employee Stock Option
Scheme. The Company has not Bought Back any of its securities during the year under review.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The company does not have any Subsidiary, Joint Venture or Associate Company.

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 a statement containing salient
features of the Financial Statements of your Company''s Subsidiaries, Associates and Joint Ventures in
Form AOC-1 is attached to the Financial Statements of your Company as Annexure - 1.

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

Investments made by the Company under Section 186 of the Companies Act, 2013 during the year under
review are given in para 2.2 of Notes forming part of the financial statements.

There were no loans, guarantees made by the Company under Section 186 of the Companies Act, 2013
during the year.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

There were no materially significant related party transactions entered by the Company with its Promoters,
Directors, Key Management Personnel and other persons which may have a potential conflict with the
interest of the Company.

All the related party transactions that were entered during the financial year were in the ordinary course
of the business of the Company

All the related party transactions are placed before the Audit Committee for approval. Required disclosures
are made to the Committee on quarterly basis in terms of the approval of the Committee.

The Policy on materiality of related party transactions and also on dealing with the related party transactions
as approved by the Audit Committee and Board of Directors is uploaded on the Company''s web-site and
the link for the same is https://www.nationalfitting.com.

The particulars of Contracts or Arrangements with the related parties made under Section 188 of the
Companies Act, 2013 are furnished in Annexure - 2 and are attached to this report.

INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY

The Company has implemented adequate procedures and internal controls which provide reasonable
assurance regarding reliability of financial reporting and preparation of financial statements.

The Company also assures that internal controls are operating effectively.

MATERIAL CHANGES AND COMMITMENTS

There were no material changes and commitments affecting the financial position of the Company which
have occurred between the end of the financial year and the date of the report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Amount prescribed for CSR Expenditure during 2024-25 is 10.93 lacs

The company spent Rs 10.93 lacs in this financial year as CSR activities. Amount unspent is Rs. Nil.

In 2025-26 Rs 14.37 lacs has been prescribed for CSR expenditure. Details are attached separately to
this report in Annexure - 3

EXTRACTS OF ANNUAL RETURN

Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 read with corresponding
rules, the extract of the Annual Return as at 31st March, 2025 in Form MGT 9 is hosted on the website
www.nationalfitting.com

LEGAL COMPLIANCE

There were no significant and material orders passed by the regulators or courts or tribunals impacting
the going concerns status and company''s operations in future.

CORPORATE GOVERNANCE

Your Company is in compliance with the Corporate Governance guidelines, as laid out in the Securities
Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI
Listing Regulations).

All the Directors and the Senior Management personnel have affirmed in writing their compliance with
and adherence to the Code of Conduct adopted by the Company. A certificate was received from the
Managing Director in terms of SEBI Listing Regulations on the compliance declarations received from
the Directors and the Senior Management personnel.

The Statutory Auditors of the Company have examined the requirements of Corporate Governance with
reference to SEBI Listing Regulations and have certified the compliance, as required under SEBI Listing
Regulations. The Certificate in this regard is attached as Annexure - 4 to this Report.

The Chief Executive Officer and Chief Financial officer (CEO/CFO) certification as required under SEBI
Listing Regulations is attached as Annexure - 5 to this Report.

Related Party disclosures/transactions are detailed in Note 2.32 of the Notes to the financial statement.
SEXUAL HARASSMENT

Company has a policy on prohibition, prevention and redressal of sexual harassment of women at work
place and matters connected therewith. The policy is being posted at the website of the Company
www.nationalfitting.com/investors/policies.

Company has constituted an Internal Control Committee for prevention of sexual harassment of women
at work place.

During the year ended 31st March, 2025 no complaint was received under the policy.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

The Company has unclaimed dividend amounting to Rs. 44,08,022/-

a) Pursuant to Rule 6 (12) of IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 the
dividend entitlement on the shares transferred to IEPF authority on dividend paid for the financial
year 2023-24 amounting to Rs. 5,96,368/- have been transferred to the Investor Education and
Protection Fund in this financial year.

b) Pursuant to the provisions of Section 124 (5) of the Companies Act, 2013, unclaimed dividend
of Rs 25,52,548/- which remained unpaid or unclaimed for a period of 7 years and have been
transferred to the Investor Education and Protection Fund in this financial year.

The details of the unpaid and unclaimed dividend lying with the Company have been uploaded on
the website of Ministry of Company Affairs.

DEPOSITS

The Company has neither accepted nor renewed any deposits during the financial year.

PARTICULARS OF EMPLOYEES

The information required under Section 197 of the Act read with rule 5(1) of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

The ratio of the remuneration of each Director to the median and mean remuneration of the employees
of the Company for the financial year and the percentage increase in remuneration of each director, Chief
Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:

Name of Directors/Key Management Personnel	Ratio to Median Remuneration (times)	% Increase / Decrease in Remuneration
Mr A V Palaniswamy	2.50	(9.90)
Mr Jayaram Govindarajan	9.10	10.75
Mr. Susheela Balakrishnan	0.32	(2.44)
Mr. Chenniappan Selvakumar	0.31	33.33
Mr R Alagar	0.71	(56.32)
Mrs A Panath Anitha	2.04	10.15
Mr J Saravanan (Chief Financial Officer)	3.32	7.35
Mr S Aravinthan (Company Secretary)	2.68	6.19

iii) The percentage increase in the median remuneration of employees in the financial year: 13.88%

iv) The number of permanent employees on the rolls of the Company: 92

v) The decrease in employees cost for the financial year 2024-25 was 9.23%

vi) The average decrease in salaries of employees other than managerial personnel in 2024-25 was
9.15%. Percentage decrease in the managerial remuneration for the year was 10.40%

vii) The Company affirms that remuneration is as per the remuneration policy of the Company.

The information required under Section 197 of the Act read with Rule 5(2) of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2015 are given below:

During the period under review, there was no employee drawing remuneration in excess of the limits
prescribed under Section 197 of the Companies Act, 2013 and Rule 5(2) of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014.

STATUTORY AUDITORS

M/s Krishaan & Co Chartered Accountants, Chennai were appointed as Statutory Auditors of the Company
from the conclusion of the 29th Annual General Meeting held on 23.09.2022 until the conclusion of 34th
Annual General Meeting.

The report of the Statutory Auditors for financial year ended 31st March, 2025 is given along with the
Financial Statements, which are annexed to and forms part of this report.

SECRETARIAL AUDITOR

Pursuant to the requirements of the Companies Act, 2013, the Company has appointed
Mr. M R L Narasimha, B.Com, FCS, Practicing Company Secretary (Cop No: 799) as the Secretarial
Auditor for the financial years 2025-30 whose report on 16th of May, 2025 is attached separately to this
report. Annexure - 6.

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

There were no qualifications, reservations or adverse remarks made by the Statutory Auditors in their
report and there were few qualifications, reservations or adverse remarks made by the Practicing Company
Secretary in the Secretarial Audit Report.

In point 5 (a) of the Secretarial Audit Report - the Nomination and Remuneration Committee composition
was re-aligned as per SEBI (LODR) Regulations, 2015 and was informed to the Stock Exchange

In point 5 (b) of the Secretarial Audit Report - the Secretarial Compliance Report under Regulation
24A of the SEBI (LODR) Regulations, 2015 was submitted in few days'' delay.

In point 5 (c) of the Secretarial Audit Report - the Company submitted the Annual Report to the Stock
Exchange

In point 5 (d) of the Secretarial Audit Report - the Company taking steps to transfer shares to IEPF
account for which the dividend has remained unclaimed for more than 7 years relating to the year 2016-17
and arranging to file the necessary IEPF forms.

CONSERVATION OF ENERGY

Company continues to buy renewable energy.

TECHNOLOGY ABSORPTION

Company is proposing to increase cape for development of testing facilities to international standards.

FOREIGN EXCHANGE EARNINGS AND OUTGO

Foreign exchange inflow (actual) : Rs. 54,46,98,269/-

Foreign exchange used (actual) : Rs. 88,84,295/-

INDUSTRIAL RELATIONS

Relationship with the employees/labor was cordial during the year under review.

ACKNOWLEDGEMENT

Your Directors take this opportunity to thank M/s. Bank of India for the support extended during the period.
Your Directors also wish to thank all the suppliers, employees, Government Departments/Agencies and
others for their valuable contribution and assistance during the year.

FOR AND ON BEHALF OF THE BOARD

Place : Coimbatore Sd/- A.V. PALANISWAMY Sd/- JAYARAM GOVINDARAJAN

Date : 16.05.2025 DIN No. 01817391 DIN No. 02178416

Director Managing Director

---

Mar 31, 2024

Your Directors have pleasure in presenting the Thirty First Annual Report together with the Audited Balance Sheet & Profit and Loss Account for the year ended 31.03.2024.

FINANCIAL RESULTS

('' in Lakhs)
	1274.63
126.52
345.66	472.18
	802.45
240.85 (22.59)
	218.26
	584.19
	2912.47
	3496.66
	136.25
	7.84
	3352.57

The operating results for the year 2023-2024 are given below

Profit before Interest and Depreciation and Other adjustments

Less : Interest

Depreciation

Net Profit before Tax Provision for Tax :

Current Tax MAT Credit

Deferred Tax (income) / expenses Net Profit after Tax

Amount brought forward from previous year Amount available for appropriation

Appropriations

Dividend on Equity Shares

Other Comprehensive Income (Net of Tax)

Surplus carried over to Balance Sheet

FINANCIAL PERFORMANCE:

The Company''s income for the financial year ended 31st March, 2024 was Rs. 7801.56 lacs compared to Rs. 8748.82 lacs in the previous year. The profit before tax for the Company is Rs. 802.45 lacs as against Rs. 656.67 lacs in the previous year. The depreciation for the year is Rs 345.67 lacs compared to Rs.342.85 lacs in the previous year. After providing Taxation, the Company''s net profit stands at Rs 584.19 lacs as against Rs. Rs.439.03 lacs in the previous year.

An amount of Rs 3352.57 lacs is to be carried over to Balance Sheet.

The Net worth of the company is at Rs. 5,934.82 lacs as on 31.03.2024 as against Rs. 5,494.72 lacs in the previous year.

DIVIDEND

The Board of Directors has recommended a dividend of Rs 1.50 per Equity shares on 90,83,182 Equity shares of Rs 10/- each aggregating to Rs 136.25 lacs for the financial year ended 31.03.2024, (Previous year - Rs 136.25 lacs) which if approved by the shareholders in the ensuing Annual General Meeting will be paid to all the Equity shareholders, whose name appear in the Register of Members as on 30th August, 2024.

PERFORMANCE:

The company has started taking steps towards consolidation and purchasing some components.

As part of consolidation one factory unit at Thekkalur has been sold for a consideration of Rs 28 crores and our Dindigul Foundry operations are now shifted to our Vedasandur Foundry Division with effect from 16.06.2024

We expect this to have a positive impact on efficiency and increase cost savings.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Despite a decrease in the sales turnover of the company, we have focused on profitability and increased the PBT significantly to 10% vs 7.5% over the previous year.

1. Reasons for Decreased Sales: Reduction in sales is due to reduction in overall demand and not due to a reduction of market share. There was a substantial impact in sales due to the war in the Middle East region and the subsequent caution and slow down of infrastructure projects in the region. This could have a continued effect in the year to come if the situation remains unresolved or escalates. There is also a global slowdown in infrastructure spending due to elections in many major democracies.

2. Profitability Analysis: The slow markets notwithstanding, the profitability was increased. The company was able to get better margins and realization from export sales. This was assisted by the demand for large size fittings that the competition is unable to provide. The company is also continually looking at improving operational efficiency and reducing costs. Increase in Exchange rate and reduction in raw materials prices also contributed.

3. Cost Management: In order to achieve better cost management and operational efficiency we are streamlining processes, optimizing purchase and inventory management. As part of the streamlining the company is looking at consolidating operations into fewer locations thereby reducing redundant costs and increasing efficiencies. In addition to consolidating, the company is also looking at contract manufacturing or out sourcing some components to cost effective sources.

4. Investment in Growth Opportunities: The company is proposing to invest capital to the extent of 6 crores to streamline the machining and assembly operations.

5. Future Outlook: The company is taking all the necessary steps to remain confident about holding onto this level of profitability even if the world goes into chaos in the upcoming year. The new products are starting to hit the market and slowly gain acceptance which should see an increase in revenues despite poor market outlook in the near term. In the longer term, we should see significant growth in infrastructure spending once the new governments are formed globally. We are consciously developing additional supply sources to take advantage of any such spike. The company also looks forward to continuing the consolidation operations without impact to the revenue of the company that will increase profitability.

SIGNIFICANT CHANGES

Operating profit and net profit margin increased over previous year due to increase in selling prices in the export and domestic markets.

Capital expenditure to the extent of 3.35 Crores was done during the year in the infrastructure and on Valve design, machines, tooling.

Debtors, Inventories, turnover ratio, current sale ratio and debt equity ratio has not changed significantly over the previous year.

As indicated above Return on Net Worth was also affected compared to previous year. Ratios are detailed in Note 2.31 of the Notes to the Financial Statements.

RISK MANAGEMENT AND FUTURE OUTLOOK

The company has been reviewing the various risks constantly and taking steps to avoid their impact on performance. By identifying and addressing market risks proactively, the company can enhance the resilience and sustainability of its business operations in the competitive environment.

1. Commodity Price Volatility: Raw material for production is a commodity prone to price fluctuations due to changes in demand, supply, and global economic conditions. Fluctuations in these prices can directly impact our production costs and profit margins. To mitigate this risk, we are constantly working to improve yields, reduce rejections and also diversifying our supply sources.

2. Market Competition: The market for grooved fittings and valves is highly competitive, both domestically and internationally with heavy competition from Chinese manufacturers. Competitors offer similar products at substantially lower prices. To manage this risk, we are focused on items that the competition is not competitive in. Our quality and customer service differentiate us in the market. We are also slowly making in-roads into the domestic infrastructure market under the Make in India schemes.

3. Regulatory Compliance: Compliance with various regulations and standards, both in India and in export markets, is essential for our products. Changes in regulations or non-compliance can result in fines, legal issues, or loss of market access. We are investing in staying updated with regulatory changes, maintaining proper certifications, and implementing robust compliance procedures.

4. Foreign Exchange Risk: The foreign exchange rate continues to be favorable to the company and we expect this to remain through the current year. The company intends to continue to increase its domestic market share to offset any potential impact from exchange rate fluctuations. Company does not depend on any imports that will impact our costs.

5. Supply Chain Disruptions: The latest wars in the Middle East could have some impact on shipping which could potentially have impacts in managing customer commitments. To manage this risk, we are working with our distribution channels to maintain higher buffer stocks, or have contingency plans in place to quickly address any disruptions.

6. Economic Downturns: The risk of economic downturns is high given the global political situation compounded further by war risk in our primary markets. This can lead to reduced demand for our products as construction and infrastructure projects may be postponed or canceled. To manage this risk, we are focusing on diversifying our customer base across different industries and regions, maintaining strong relationships with key distributors, and implementing cost-saving measures.

7. Man power availability: Skilled man power availability is still a challenge while unskilled labor is mostly expat dependent. This could be a risk going forward depending on infrastructure investments in the Northern regions of the country. We are in the process of consolidating operations to reduce

skilled manpower requirements while also pursuing subcontract manufacturing of certain non-critical components to reduce unskilled labor requirements.

DIRECTORS

Mrs Panath Anitha, Director, who retires by rotation, and being eligible, offered himself for reappointment. The term of the Independent Director Mr R Alagar ended on 13.08.2024.

Mr Jayaram Govindarajan has been appointed as Managing Director with effect from 24.07.2024 KEY MANAGEMENT PERSONNEL

The following persons are the Key Management Personnel as per the provisions of the Companies Act, and rules made there under:-

Mr A V Palaniswamy	Managing Director
Mr Jayaram Govindarajan	Whole Time Director
Mrs Panath Anitha	Whole Time Director
Mr J Saravanan	Chief Financial Officer
Mr S Aravinthan	Company Secretary

DIRECTORS'' RESPONSIBILITY STATEMENT

Your Directors further report that

(i) in the preparation of annual accounts, the applicable accounting standards have been followed and there were no material departures;

(ii) the accounting policies selected have been applied consistently, prudent judgments and estimates have been made to give a true and fair view of the state of affairs of the company as at 31.03.2024 and of the Profit of the company and the cash flow statement for the year ended 31.03.2024.

(iii) they 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 annual accounts have been prepared on a going concern basis.

(v) the directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. Internal financial control means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

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

CODE OF CONDUCT

All Directors and Senior Management of the Company have affirmed Compliance with the Code of

Conduct of National Fittings Limited for the financial Year ended 31st March 2024.

DECLARATION OF INDEPENDENT DIRECTORS

The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

NUMBER OF BOARD MEETINGS

During the year, 4 (Four) Board Meetings were convened and held, the details of which are given in the Corporate Governance Report.

POLICY ON DIRECTOR''S APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES, INDEPENDENCE OF A DIRECTOR, KEY MANAGEMENT PERSONNEL AND OTHER EMPLOYEES

The Company shall have such person on the Board who complies with the requirements of the Companies Act, 2013. Directors/KMPs shall be persons of sound integrity and honesty, apart from knowledge, experience etc in the respective fields.

Composition of the Board shall be in compliance with the requirements of the Companies Act, 2013. No person less than the age of 21 years shall be appointed as the director of the Board.

The Executive Directors are paid with remuneration as approved by the members but are not paid sitting fees. Independent directors are not entitled for ESOPs.

MANNER IN WHICH FORMAL ANNUAL EVALUATION HAS BEEN MADE BY THE BOARD OF ITS OWN PERFORMANCE AND THAT OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS

1. Nomination and Remuneration Committee of the Board prepared and sent through its Chairman draft feedback form for evaluation of the Board and Independent Directors.

2. Independent Directors at a meeting of themselves considered and evaluated the performance of the Board, performance of the Chairman and other Non-Independent Directors.

3. The Board subsequently evaluated performance of the Board, the Committees and Independent Directors.

SHARES

There was no issue of fresh Equity Shares during the financial year. No Bonus Shares were issued. The Company has not issued any Sweat Equity Shares and not provided any Employee Stock Option Scheme. The Company has not Bought Back any of its securities during the year under review.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The company does not have any Subsidiary, Joint Venture or Associate Company.

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 a statement containing salient features of the Financial Statements of your Company''s Subsidiaries, Associates and Joint Ventures in Form AOC-1 is attached to the Financial Statements of your Company as Annexure - 1.

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

Investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review are given in para 2.2 of Notes forming part of the financial statements.

There were no loans, guarantees made by the Company under Section 186 of the Companies Act, 2013 during the year.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

There were no materially significant related party transactions entered by the Company with its Promoters, Directors, Key Management Personnel and other persons which may have a potential conflict with the interest of the Company.

All the related party transactions that were entered during the financial year were in the ordinary course of the business of the Company

All the related party transactions are placed before the Audit Committee for approval. Required disclosures are made to the Committee on quarterly basis in terms of the approval of the Committee.

The Policy on materiality of related party transactions and also on dealing with the related party transactions as approved by the Audit Committee and Board of Directors is uploaded on the Company''s web-site and the link for the same is https://www.nationalfitting.com.

The particulars of Contracts or Arrangements with the related parties made under Section 188 of the Companies Act, 2013 are furnished in Annexure - 2 and are attached to this report.

INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY

The Company has implemented adequate procedures and internal controls which provide reasonable assurance regarding reliability of financial reporting and preparation of financial statements.

The Company also assures that internal controls are operating effectively.

MATERIAL CHANGES AND COMMITMENTS

There were no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year and the date of the report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Amount prescribed for CSR Expenditure during 2023-24 is 7.24 lacs

The company spent Rs 10.79 lacs in this financial year as CSR activities. Amount unspent is Rs. Nil. Amount spent in excess: 3.54 lacs

In 2024-25 Rs 10.93 lacs has been prescribed for CSR expenditure. Details are attached separately to this report in Annexure - 3

EXTRACTS OF ANNUAL RETURN

Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 read with corresponding rules, the extract of the Annual Return as at 31st March, 2024 in Form MGT 9 is hosted on the website www.nationalfitting.com

LEGAL COMPLIANCE

There were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company''s operations in future.

CORPORATE GOVERNANCE

Your Company is in compliance with the Corporate Governance guidelines, as laid out in the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI Listing Regulations).

All the Directors and the Senior Management personnel have affirmed in writing their compliance with and adherence to the Code of Conduct adopted by the Company. A certificate was received from the Managing Director in terms of SEBI Listing Regulations on the compliance declarations received from the Directors and the Senior Management personnel.

The Statutory Auditors of the Company have examined the requirements of Corporate Governance with reference to SEBI Listing Regulations and have certified the compliance, as required under SEBI Listing Regulations. The Certificate in this regard is attached as Annexure - 4 to this Report.

The Chief Executive Officer and Chief Financial officer (CEO/CFO) certification as required under SEBI Listing Regulations is attached as Annexure - 5 to this Report.

Related Party disclosures/transactions are detailed in Note 2.32 of the Notes to the financial statement. SEXUAL HARASSMENT

Company has a policy on prohibition, prevention and redressal of sexual harassment of women at work place and matters connected therewith.

Company has constituted an Internal Control Committee for prevention of sexual harassment of women at work place.

During the year ended 31st March, 2024 no complaint was received under the policy.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

The Company has unclaimed dividend amounting to Rs. 56,84,266/-

a) Pursuant to Rule 6 (12) of IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 the dividend entitlement on the shares transferred to IEPF authority on dividend paid for the financial year 2022-23 amounting to Rs. 5,96,368/- have been transferred to the Investor Education and Protection Fund in this financial year.

b) Pursuant to the provisions of Section 124 (5) of the Companies Act, 2013, unclaimed dividend of Rs 19,57,906/- which remained unpaid or unclaimed for a period of 7 years and have been transferred to the Investor Education and Protection Fund in this financial year.

The details of the unpaid and unclaimed dividend lying with the Company have been uploaded on the website of Ministry of Company Affairs.

DEPOSITS

The Company has neither accepted nor renewed any deposits during the financial year.

PARTICULARS OF EMPLOYEES

The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

(i) & (ii) The ratio of the remuneration of each Director to the median and mean remuneration of the employees of the Company for the financial year and the percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:

Name of Directors/Key Management Personnel	Ratio to Median Remuneration (times)	% Increase / Decrease in Remuneration
Mr A V Palaniswamy, Managing Director	6.28	3.23
Mr Jayaram Govindarajan	8.28	9.52
Mr. Susheela Balakrishnan	0.34	100
Mr. Chenniappan Selvakumar	0.25	(0.25)
Mr R Alagar	0.71	0.00
Mrs A Panath Anitha	1.87	11.35
Mr J Saravanan (Chief Financial Officer)	3.11	8.55
Mr S Aravinthan (Company Secretary)	2.54	8.68

iii) The percentage increase in the median remuneration of employees in the financial year: 13.25%

iv) The number of permanent employees on the rolls of the Company: 149

v) The increase in employees cost for the financial year 2023-24 was 1.06%

vi) The average increase in salaries of employees other than managerial personnel in 2023-24 was 1.60%. Percentage increase in the managerial remuneration for the year was 7.57%

vii) The Company affirms that remuneration is as per the remuneration policy of the Company.

The information required under Section 197 of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2015 are given below:

During the period under review, there was no employee drawing remuneration in excess of the limits prescribed under Section 197 of the Companies Act, 2013 and Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

STATUTORY AUDITORS

M/s Krishaan & Co Chartered Accountants, Chennai were appointed as Statutory Auditors of the Company from the conclusion of the 29th Annual General Meeting held on 23.09.2022 until the conclusion of 34th Annual General Meeting.

The report of the Statutory Auditors for financial year ended 31st March, 2024 is given along with the Financial Statements, which are annexed to and forms part of this report.

SECRETARIAL AUDITOR

Pursuant to the requirements of the Companies Act, 2013, the Company has appointed Mr. M R L Narasimha, B.Com, FCS, Practicing Company Secretary (Cop No: 799) as the Secretarial Auditor for the financial year 2023-24 whose report on 27th of May, 2024 is attached separately to this report. Annexure - 6.

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

There were no qualifications, reservations or adverse remarks made by the Statutory Auditors in their report and there were no qualifications, reservations or adverse remarks made by the Practicing Company Secretary in the Secretarial Audit Report.

CONSERVATION OF ENERGY

Company continues to buy renewable energy.

TECHNOLOGY ABSORPTION

Company is proposing to increase cape for development of testing facilities to international standards.

FOREIGN EXCHANGE EARNINGS AND OUTGO

Foreign exchange inflow (actual) : Rs. 55,44,11,607/-

Foreign exchange used (actual) : Rs. 1,12,37,292/-

INDUSTRIAL RELATIONS

Relationship with the employees/labor was cordial during the year under review.

ACKNOWLEDGEMENT

Your Directors take this opportunity to thank M/s. Bank of India for the support extended during the period. Your Directors also wish to thank all the suppliers, employees, Government Departments/Agencies and others for their valuable contribution and assistance during the year.

FOR AND ON BEHALF OF THE BOARD

Place : Coimbatore Sd/- A.V. PALANISWAMY Sd/- JAYARAM GOVINDARAJAN

Date : 27.05.2024 DIN No. 01817391 DIN No. 02178416

Managing Director Whole time Director

---

Mar 31, 2018

The Directors have pleasure in presenting the Twenty Fifth Annual Report together with the Audited Balance Sheet & Profit and Loss Account for the year ended 31.03.2018.

FINANCIAL RESULTS

The operating results for the year 2017-2018 are given below : -

(Rs. in Lakhs)

Profit before Interest and Depreciation and Other adjustments		1658.53
Less : Interest	168.00
Depreciation	268.54	436.54
Net Profit before Tax		1221.99
Provision for Tax :
Current Tax	380.30
Deferred Tax (income) / expenses	50.28
MAT credit utilized	16.37	446.95
Net Profit after Tax		775.04
Amount brought forward from previous year		1973.73
Amount available for appropriation		2748.77
Appropriations
Add : Transfer from Revaluation Reserve		1.30
Les : Interim and Final Dividend on Equity Shares		(181.66)
Dividend Distribution Tax		(36.98)
Surplus carried over to Balance Sheet		2531.43

FINANCIAL PERFORMANCE:

The Financial Statements for the year ended March 31, 2018 have been prepared under Ind AS (Indian Accounting Standards) for the first time by the Company. To ensure comparative figures, the financial statements for the year ended March 31, 2017 have been restated in accordance with Ind AS.

Members aware a Scheme of amalgamation with appointed date being 1st April, 2017 whereby the Holding Company, Interfit India Limited and 100% Wholly Owned Subsidiary Company, Merit Industries Limited were to be merged was submitted for sanction with the Hon’ble National Company Law Board, Chennai Bench pending sanction the Company could not circulate the audited merged accounts earlier. Now since the Scheme of Amalgamation has been approved by the Hon’ble National Company Law Board, Chennai Bench by their order dated 25th March, 2019 with effective date being 29th March, 2019 the duly audited merged accounts are being presented before the members for their approval. Your directors confirm that the directives of Hon’ble National Company Law Tribunal, Chennai Bench have complied with.

ALLOTMENT OF SHARES AND CHANGES IN CAPITAL STRUCTURE INCREASE IN AUTHORIZED SHARE CAPITAL

The Authorised Share Capital of the Company has increased from Rs. 13.75 Crores comprising of 87,50,000 equity shares of Rs. 10/- each and 5,00,000 preference shares of Rs. 100/- each to Rs. 29.50 Crores comprising of 2,45,00,000 equity shares of Rs. 10/- each and 5,00,000 preference shares of Rs. 100/each by virtue of the Order on Scheme of Amalgamation passed by Hon’ble National Company Law Tribunal, Chennai Bench.

INCREASE IN PAID-UP SHARE CAPITAL

Pursuant to the Order on Scheme of Amalgamation passed by Hon’ble National Company Law Tribunal, Chennai Bench, 3 (three) equity shares of Rs. 10/- each of the Company shall have to be allotted for every 2 (two) equity shares of Rs. 10/- each held by the Shareholders of Interfit India Limited, the Transferor Company - 1. Consequently, the paid-up share capital of the Company shall increase from 83,20,000 equity shares of Rs. 10/- each to 90,83,182 equity shares of Rs. 10/- each valuing Rs 9,08,31,820/Pursuant to the Order on Scheme of Amalgamation passed by Hon’ble National Company Law Tribunal, Chennai Bench, 1 (one) 9% Non-Convertible Non-Cumulative Redeemable Preference Share of Rs. 100/each of the Company shall have to be allotted for every 1 (one) preference share of Rs. 100/- each held by the Preference Shareholders of Merit Industries Limited, the Transferor Company- 2. Consequently, the paid-up preference share capital of the Company shall increase to Rs. 4,00,00,000.

The total paid up capital of the Company is Rs 13,08,31,820/

FINANCIAL PERFORMANCE:

The Company’s gross income for the financial year ended 31st March, 2018 was Rs. 6467.03 lacs compared to Rs.6,960.83 lacs in the previous year. The profit before tax for the Company is Rs. 1221.99 lacs as against Rs. 1,596.03 lacs in the previous year. The depreciation for the year is Rs.268.54 lacs compared to Rs.104.95 lacs in the previous year. After providing Taxation, the Company’s net profit stands at Rs.775.04 lacs against Rs.1,014.45 lacs in the previous year.

An amount of Rs 2531.43 lacs is to be carried over to Balance Sheet after appropriation of Dividend on Equity Shares including Dividend Tax.

The Net worth of the company is at Rs.4716.06 lacs as on 31.03.2018 as against Rs.2,772.61 lacs in the previous year.

DIVIDEND

The Company has not declared any interim dividend during the year under review and is not proposing to declare any final dividend. Further the Company has not transferred any amount to reserves during the year.

PERFORMANCE:

The Company continued to manufacture and market high quality piping products meeting international standards. The Sales was increased in volume term; but both sales and margins were lowered in value term due to price reduction to with stand the Chinese competition and subdued exchange rate conditions.

The Company hopes to improve the margins during the current year unless any changes In the international scenario affect the Company results and also considering favorable exchange rates.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT TRENDS & DEVELOPMENT

Domestic market has been improving for the products manufactured by our Company. The export market has also showing some strength amidst the competition by China.

We hope to generate sizable volume of business this year and the new products developed and likely to be introduced during the second half of the year will also help us to have strong domestic market revenue.

Material Developments during the year under review that occurred between end of the financial year and date of this report - Scheme of Amalgamation of Interfit India Limited and Merit Industries Limited with the Company

The Scheme of Amalgamation of Interfit India Limited and Merit Industries Limited with the Company, which was initiated in January, 2018 reached the major stages during September, 2018.

Taking into consideration this scenario, the Board decided to apply for extension of time to hold the Twenty Fifth Annual General Meeting to the Registrar of Companies so that the merged accounts can be presented for approval of shareholders. The Registrar of Companies granted an extension of three months i.e. till 31st December, 2018, to hold the Twenty Fifth Annual General Meeting.

The meeting of shareholders of the Company was convened on 5th December, 2018 as directed by the Hon’ble National Company Law Tribunal, Chennai Bench for approving the scheme and the scheme was duly approved with the requisite majority. More than 90% of the value of the unsecured creditors of the Company gave their consent for the amalgamation and so the meeting of unsecured creditors of the Company has been dispensed with.

Based on the approvals of share holders and creditors the petitions by the Companies were filed before the Hon’ble National Company Law Tribunal, Chennai on 14.01.2019.

The Scheme was sanctioned by Hon’ble National Company Law Tribunal, Chennai by an order dated 25th March 2019 and came into effect on 29th March, 2019.

DIRECTORS

Mr M Loganathan, Director, resigned from Directorship on 13.12.2017 due to his professional pre-occupation.

Mrs Panath Anitha, Whole Time Director, who retires by rotation, and being eligible, offered herself for reappointment.

Mr Arjunaraj Dhananjyan, was appointed as an Additional and Independent Director with effect from 13.12.2017

Mr Chenniappan Selvakumar, was appointed as an Additional and Independent Director with effect from 13.12.2017

KEY MANAGEMENT PERSONNEL

Mr. A.V. Palaniswamy, Managing Director, Mrs Panath Anitha, Whole Time Director, Mr Jayaram Govindarajan, Whole Time Director, Mr. J. Saravanan, Chief Financial Officer and Mr. S. Aravinthan, Company Secretary of the Company are the Key Management Personnel as per the provisions of the Companies Act, and rules made there under.

Mrs Panath Anitha, was re-appointed as the Whole Time Director with effect from 14.02.2018 Mr A V Palaniswamy, was re-appointed as the Managing Director with effect from 01.01.2019

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The company does not have any Subsidiary, Joint Venture or Associate Company.

Pursuant to the provisions of Section 129(3) of the Act, a statement containing salient features of the Financial Statements of your Company’s Subsidiaries, Associates and Joint Ventures in Form AOC-1 is attached to the Financial Statements of your Company as Annexure 1.

Pursuant to the provisions of Section 136 of the Act, the Financial Statements of your Company, Financial Statements along with relevant documents are available on the website of your Company.

DIRECTORS’ RESPONSIBILITY STATEMENT

Your Directors further report that

(i) in the preparation of annual accounts the applicable accounting standards have been followed and there were no material departures;

(ii) the accounting policies selected have been applied consistently, prudent judgments and estimates have been made to give a true and fair view of the state of affairs of the company as at 31st March 2018 and of the Profit of the company and the cash flow statement for the year ended 31.03.2018.

(iii) they 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 annual accounts have been prepared on a going concern basis.

(v) the directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively Internal financial control means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business including adherence to Company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

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

CODE OF CONDUCT

All Directors and senior management of the Company have affirmed Compliance with the Code of Conduct of National Fittings Limited for the financial Year ended 31st March 2018.

DECLARATION OF INDEPENDENT DIRECTORS

The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

NUMBER OF BOARD MEETINGS

During the year, 7 (Seven) Board Meetings were convened and held, the details of which are given in Corporate Governance Report.

POLICY ON DIRECTOR’S APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES, INDEPENDENCE OF A DIRECTOR, KEY MANAGEMENT PERSONNEL AND OTHER EMPLOYEES

The company shall have such person on the Board who complies with the requirements of the Companies Act, 2013.

Directors/KMPs shall be persons of sound integrity and honesty, apart from knowledge, experience etc in the respective fields.

Composition of the Board shall be in compliance with the requirements of the Companies Act, 2013.

No person less than the age of 21 years shall be appointed as the director of the Board.

The Executive Directors are paid with remuneration as approved by the members but are not paid sitting fees.

Independent directors are not entitled for ESOPs

Managing Director, Whole Time Director, Company Secretary and Chief Financial Officer shall be the Key Management Personnel (KMPs) of the Company.

All persons who are Directors, KMPs, members of Senior Management and all the employees shall be abide by the code of conduct.

MANNER IN WHICH FORMAL ANNUAL EVALUATION HAS BEEN MADE BY THE BOARD OF ITS OWN PERFORMANCE AND THAT OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS

1. Nomination and Remuneration Committee of the Board prepared and sent through its Chairman Draft feedback form for evaluation of the Board and independent directors.

2. Independent Directors at a meeting of themselves considered and evaluated the Board’s performance, performance of the Chairman and other non-independent Directors.

3. The Board subsequently evaluated performance of the Board, the Committees and Independent Directors.

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

Investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review are given in para 2.2 of Notes forming part of the financial statements.

There were no loans, guarantees made by the Company under Section 186 of the Companies Act, 2013 during the year.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

All the related party transactions that were entered during the financial year were in the ordinary course of the business of the Company.

There were no materially significant related party transactions entered by the Company with its promoters, Directors, Key Management Personnel and other persons which may have a potential conflict with the interest of the Company.

All the related party transactions are placed before the Audit Committee for approval. For the business transactions with the related parties which are of repetitive nature as well as for the normal business transactions which cannot be foreseen prior omnibus approval from the Audit Committee are obtained and accordingly required disclosures are made to the Committee on quarterly basis in terms of the approval of the Committee.

The Policy on materiality of related party transactions and also on dealing with the related party transactions as approved by the Audit Committee and Board of Directors is uploaded on the Company’s web-site and the link for the same is https://www.nationalfitting.com.

The particulars of Contracts or Arrangements with the related parties made under Section 188 of the Companies Act, 2013 are furnished in Annexure - 2 and are attached to this report.

SHARES

There was no issue of fresh equity shares during the financial year. No Bonus Shares were issued. The Company has not issued any Sweat Equity Shares and not provided any Employee Stock Option Scheme. The Company has not bought back any of its securities during the year under review.

INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY

The Company has implemented adequate procedures and internal controls which provide reasonable assurance regarding reliability of financial reporting and preparation of financial statements.

The Company also assures that internal controls are operating effectively.

MATERIAL CHANGES AND COMMITMENTS

There were no material changes and commitments affecting the financial position of the company which have occurred between the end of the financial year and the date of the report.

RISK MANAGEMENT POLICY

Potential risk for the business of the Company and steps to be adopted by the Company to handle the risks has been reviewed regularly. Following are the few risks and the methods to be adopted by the Company to handle them.

1) Market Risk

Input costs have increased nearly 20% resulting in the total cost increase by 10-12%. Due to the increased competition from China and other companies using China as a manufacturing base has resulted in reduction of selling price nearly 20% from last year prices. Cost increase and the reduction in selling price has eroded our margin substantially. Export market is becoming more and more unviable.

Company is taking effective steps to increase our domestic market share by appointing distribution network and regional sales personnel.

2) Exchange Risk

Indian currency did not depreciate enough to offset the input cost increase and to meet the low cost products from China in the international markets. China has depreciated their currency nearly 10% during the last six months.

3) Power

Company has been buying wind power for nearly 10 months of the year and has resulted in reduction of power cost in total cost of production. Grid power supply has improved substantially.

4) Manpower Requirement

Company continuous to rely on expat labour from northern belt for nearly 70% of work force due to non-availability of local labour in production areas. Cost of manpower has nearly doubled in the last one year. Company has installed more automated machine operations to reduce manpower.

5) Product Development

To meet the cost of production, Company has taken steps to re-design the products by optimizing the weight without scarifying performance and has resulted in input cost reduction.

Company has taken steps to diversify the product base into pumps for domestic and international market requirements. Design will be attractive enough to get a acceptable share of the domestic and export market. Developed models are under testing and will be into production line during the current year. Company will provide the major components like casting in Iron and Stainless Steel. Machining and assembly will be done by outside sources.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

A Board level Committee of CSR has been constituted and the Board has adopted a CSR Policy as recommended by the Committee.

The Company completed the construction of a school building at a Government Municipal School at Madhapur village at a cost of Rs 34.56 lacs.

The Annual Report on the Company’s CSR activities is furnished in Annexure 3 and attached to this report ANNUAL RETURN

The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and administration) Rules, 2014 is furnished in Annexure 4 and is attached to this Report.

LEGAL COMPLIANCE

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

CORPORATE GOVERNANCE

Your Company is in compliance with the Corporate Governance guidelines, as laid out in the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI Listing Regulations). All the Directors and the Senior Management personnel have affirmed in writing their compliance with and adherence to the Code of Conduct adopted by the Company.

The annual report of the Company contains a certificate by the Chief Executive Officer and Managing Director in terms of SEBI Listing Regulations on the compliance declarations received from the Directors and the Senior Management personnel.

The Statutory Auditors of the Company have examined the requirements of Corporate Governance with reference to SEBI Listing Regulations and have certified the compliance, as required under SEBI Listing Regulations. The Certificate in this regard is attached as Annexure 5 to this Report.

The Chief Executive Officer / Chief Financial Officer (CEO/CFO) certification as required under SEBI Listing Regulations is attached as Annexure 6 to this Report. Related Party disclosures/transactions are detailed in Note 2.29 of the Notes to the financial statement.

SEXUAL HARASHMENT

Company has a policy on prohibition, prevention and redressal of Sexual Harassment of women at work place and matters connected therewith. During the year ended 31st March, 2018, no complaint was received under the policy.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

The Company has unclaimed dividend amounting to Rs. 87,27,590/Pursuant to the provisions of Section 124 (5) of the Companies Act, 2013, unclaimed dividend of Rs 1,93,280/, which remained unpaid or unclaimed for a period of 7 years have been transferred by the Company to the Investor Education and Protection Fund for this financial year..

The details of the unpaid and unclaimed dividend lying with the Company has been uploaded on the website of Ministry of Company Affairs.

Pursuant to the provisions of Section 124 (6) of the Companies Act, 2013, 78780 equity shares accompanying dividend which remained unpaid or unclaimed for a period of 7 years have been transferred by the Company to the Investor Education and Protection Fund in this financial year.

DEPOSITS

The Company has neither accepted nor renewed any deposits during the financial year.

PARTICULARS OF EMPLOYEES

The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

(i) & (ii) The ratio of the remuneration of each Director to the median and mean remuneration of the employees of the company for the financial year and the percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:

	Name of Directors / Key Management Personnel	Ratio to Median Remuneration (times)	% Increase / Decrease in Remuneration
	Mr A V Palaniswamy, Managing Director	12.25	-3.77
	Mr Jayaram Govindarajan	6.25	160
	Mr M Loganathan	0.12	0.00
	Mr. Dhananjayan	0.07	100
	Mr. Selvakumar	0.14	100
	Mr R Alagar	1.08	25
	Mrs A PanathAnitha	1.77	17.36
	Mr J Saravanan (Chief Financial Officer)	3.48	12.75
	Mr S Aravinthan (Company Secretary)	2.84	12.87

iii) The percentage increase in the median remuneration of employees in the financial year: 10%

iv) The number of permanent employees on the rolls of the Company: 111

v) Explanation on the relationship between average increase in remuneration and company performance:

On an average, employees received an increase of 19% during the financial year 2017-18. The remuneration components include a fair proportion of fixed and variable pay. The increase in remuneration is in line with the market. In order to ensure that remuneration reflects Company performance, the performance pay is also linked to organization performance, apart from an individual’s performance.

vi) Comparison of the remuneration of the key managerial personnel against the performance of the Company:

(In Lacs)

Aggregate remuneration of key managerial personnel (KMP) in FY 2017-18	55,35,100
Revenue	61,94,62,042
Remuneration of KMPs (as % of revenue)	0.89
Profit before Tax (PBT)	11,62,05,836
Remuneration of KMP (as % of PBT)	4.76

vii) Variations in the market capitalization of the Company, price earnings ratio as at the closing date of the current financial year and previous financial year:

(In Lacs)

Particulars	As at 31.03.2018	As at 31.03.2017	% Increase
Closing price of share at BSE (Rs.)	201.8	240	-15.917
Market Capitalisation (Rs.)	16789.76	19968	-15.917
Price Earnings ratio	22.60	19.69	14.78
Net worth	3315.50	2772.60	19.58

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

The average increase in salaries of employees other than managerial personnel in 2017-18 was 15.28%. Percentage increase in the managerial remuneration for the year was 18.14%

ix) Comparison of the each remuneration of the Key Managerial Personnel against the performance of the company:

	Mr. A V Palaniswamy Managing Director	Mr.Jayaram Govindarajan Whole Time Director	Mrs. A Panath Anitha, Woman Director	Mr. J Saravanan Chief Financial Officer	Mr. S Aravinthan Company Secretary
Remuneration in FY2017-18	25,50,000	13,00,000	3,68,100	7,25,000	5,92,000
Revenue	61,94,62,042	61,94,62,042	61,94,62,042	61,94,62,042	61,94,62,042
Remuneration as % of Revenue	0.41	0.21	0.06	0.12	0.10
Profit before Tax (PBT)	11,62,05,836	11,62,05,836	11,62,05,836	11,62,05,836	11,62,05,836
Remuneration (as % of PBT)	2.19	1.12	0.32	0.62	0.51

x) The key parameters for any variable component of remuneration availed by the directors:

There are no variable components of remuneration paid to the directors.

xi) The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year; and

Nil

xii) Affirmation that the remuneration is as per the remuneration policy of the company.

The Company affirms that remuneration is as per the remuneration policy of the Company.

The information required under Section 197 of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2015 are given below:

During the period under review, there was no employee drawing remuneration in excess of the limits prescribed under Section 197 of the Companies Act, 2013 and Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

STATUTORY AUDITORS

M/s V Krish & Associates, Chartered Accountants, Chennai were appointed as Statutory Auditors of the Company from the conclusion of the 24th Annual General Meeting held on 12.08.2017 until the conclusion of 25th Annual General Meeting.

The Company has received a certificate from the Auditors for the appointment of them as statutory auditors and to the effect that if they are appointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.

Their appointment and payment of remuneration are to be confirmed and approved in the ensuing Annual General Meeting.

Further, the report of the Statutory Auditors for financial year ended 31st March, 2018 is given along with the Financial Statements which is annexed to and forms part of this report. The said report has a matter of emphasis, which does not require any explanation from the Directors.

The unmerged financial statements of the Company for the year ended 31st March, 2018 were earlier approved by the Board of Directors at its meeting held on 30th May, 2018. Those unmerged financial statements have been updated by the Company, so as to give effect to the scheme of amalgamation approved by the Hon’ble National Company Law Tribunal, Chennai Bench,vide its order dated 25th March, 2019, filed by the Company with the Registrar of Companies on 29th March, 2019, with effect from appointed date, i.e 1st April, 2017. As a result, fresh audit report has been issued on the merged financial statements.

SECRETARIAL AUDIT REPORT

Pursuant to the requirements of the Companies Act, 2013, the Company has appointed Mr M R L Narasimha, B.Com, FCS, Practicing Company Secretary (Cop No: 799) as the Secretarial Auditor for the financial year 2017-18 whose report on 30th March, 2019 is attached separately to this report. Annexure 7.

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

There were no qualifications, reservations or adverse remarks made either by the Auditors or by the Practicing Company Secretary in their respective reports.

CONSERVATION OF ENERGY

a) Company has replaced most of the less efficient machines with newer and less power consuming equipments in all the areas of manufacturing.

b) Long term contract has been executed with wind energy suppliers there by reducing costs and less dependency on fossil fuel energy. Nearly 80% of the energy requirement will be from wind energy.

c) Company is also exploring the economic viability of installing its own wind mills to reduce cost of power.

TECHNOLOGY ABSORPTION INDUSTRIAL RELATIONS

Company has taken steps to introduce newer technology machines in production and inspection areas to increase productivity and reduce rejection levels.

Computer generated models for tooling, data collection and manufacturing processes have been introduced to improve productivity.

FOREIGN EXCHANGE EARNINGS AND OUTGO

Foreign exchange inflow (actual) : Rs. 51,97,52,059/Foreign exchange used (actual) : Rs. 71,86,755/

INDUSTRIAL RELATIONS

Relationship with the employees/labor was cordial during the year under review.

ACKNOWLEDGEMENT

Your Directors take this opportunity to thank M/s. Bank of India for the support extended during the period. Your Directors also wish to thank all the suppliers, employees, Government Departments/Agencies and others for their valuable contribution and assistance during the year.

FOR AND ON BEHALF OF THE BOARD

Place : Coimbatore Sd/- A.V. PALANISWAMY Sd/- JAYARAM GOVINDARAJAN

Date : 30.03.2019 DIN No. 01817391 DIN No. 02178416

Managing Director Director

---

Mar 31, 2017

The Directors have pleasure in presenting the Twenty Fourth Annual Report together with the Audited Balance Sheet & Profit and Loss Account for the year ended 31.03.2017

FINANCIAL RESULTS

The operating results for the year 2016-2017 are given below : -

	(Rs. in Lakhs)
Profit before Interest and Depreciation
and Other adjustments		1798.36
Less : Interest	97.38
Depreciation	104.95	202.33
Net Profit before Tax Provision for Tax :		1596.03
Current Tax	584.61
Deferred Tax (income) / expenses	(3.03)	581.58
Net Profit after Tax		1014.45
Amount brought forward from previous year		456.63
Amount available for appropriation		1471.08
Appropriations
General Reserve		75.00
Interim Dividend on Equity Shares		166.40
Final Dividend on Equity Shares*		—
Dividend Distribution Tax		33.88
Surplus carried over to Balance Sheet		1195.80

* Will be recognized as a liability on approval by the shareholders at the Annual General Meeting. FINANCIAL PERFORMANCE:

The Company''s gross income for the financial year ended 31st March, 2017 was Rs. 6,950.22 lacs compared to Rs.5,398.72 lacs in the previous year. The profit before tax for the Company is Rs. 1,596.03 lacs as against Rs. 1,110.27 lacs in the previous year. The depreciation for the year is Rs.104.95 lacs compared to Rs.121.37 lacs in the previous year.

After providing Taxation, the Company''s net profit stands at Rs.1,014.45 lacs against Rs.738.79 lacs in the previous year.

Your company proposes to transfer Rs. 75 lacs to General Reserve out of the amount available for appropriation Rs.1,471.08 lacs and an amount of Rs. 1195.80 lacs is to be carried over to Balance Sheet after appropriation of Dividend on Equity Shares including Dividend Tax.

The Net worth of the company is at Rs.2,772.60 lacs as on 31.03.2017 as against Rs.1,958.44 lacs in the previous year.

DIVIDEND

The Board of Directors declared an interim dividend of Rs 2/- per Equity Share on 83, 20,000 equity shares of Rs 10/- each aggregating to Rs 166.40 lacs on 09.02.2017 and the dividend had been distributed to the shareholders. The approval of the shareholders has been perused in this Annual General Meeting.

The Board of Directors has recommended a final dividend of Rs. 2/- per Equity share on 83,20,000 equity shares Rs 10/- each aggregating to Rs 166.40 lacs for the financial year ended 31st March, 2017, which if approved in the ensuing Annual General Meeting will be paid to all the equity shareholders, whose names appear in the Register of Members as on 05th August, 2017.

With the approval of the final dividend the total dividend for the financial year ended 31st March 2017 has been Rs. 4/- per share (Rs. 332.80 lacs).

PERFORMANCE:

The Company continued to manufacture and market high quality castings meeting international standards. Sales and margins were increased due to the continuing outsourcing of castings from reliable outsources and by effective control over costs.

The Company hopes to improve the margins further during the current year unless any changes In the international scenario affect the Company results.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT TRENDS & DEVELOPMENT

Domestic market has been improving for the products manufactured by our Company. We have been able to convince customers like L & T, Voltas, Wipro etc to specify our Brand into their buying specification. We are hoping to have the Government to introduce “Made in India” products on most of the infrastructure projects where Government fund is involved.

We hope to generate sizable volume of business with the new products developed during the second half of the year.

directors

Mr. Jayaram Govindarajan, was appointed as Additional Director on 12.08.2016 and holds the said office till the date of Annual General Meeting. A notice has been received from a member proposing his candidature for his appointment.

Mr. A V Palaniswamy, Managing Director, who retires by rotation, and being eligible, offers himself for reappointment.

key management personnel

Mr. A.V. Palaniswamy, Managing Director, Mrs Panath Anitha, Whole Time Director, Mr. J. Saravanan, Chief Financial Officer and Mr. S. Aravinthan, Company Secretary of the Company are the Key Management Personnel as per the provisions of the Companies Act, and rules made there under.

Mr. Jayaram Govindarajan, was appointed as the Whole Time Director with effect from 14.12.2016

subsidiaries, joint ventures and associate companies

The company does not have any Subsidiary, Joint Venture or Associate Company

COMPANY''S PHILOSOPHY ON CODE OF CORPORATE GOVERNANCE

The Company is committed to develop, manufacture and supply effective products to meet the customer requirements Striving towards continuous improvement in total quality and keeping abreast of the latest technologies have been enabling the Company to achieve its goal.

The focus on training and development of the employees'' skills has well bearing results in the goal attainment.

The ultimate benefit of these efforts has been aimed in enrichment of the value to the shareholders. The environment and Community has been well recognized while moving towards the goal.

DIRECTORS'' RESPONSIBILITY STATEMENT

Your Directors further report that

(i) in the preparation of annual accounts the applicable accounting standards have been followed and there were no material departures;

(ii) the accounting policies selected have been applied consistently, prudent judgments and estimates have been made to give a true and fair view of the state of affairs of the company as at 31st March 2017 and of the Profit of the company and the cash flow statement for the year ended 31.03.2017.

(iii) they 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 annual accounts have been prepared on a going concern basis.

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

Internal financial control means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

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

code of conduct

All Directors and senior management of the Company have affirmed Compliance with the Code of Conduct of National Fittings Limited for the financial Year ended 31st March 2017.

declaration of independent directors

The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

POLICY ON DIRECTOR''S APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES, INDEPENDENCE OF A DIRECTOR, KEY MANAGEMENT PERSONNEL AND OTHER EMPLOYEES

The company shall have such person on the Board who complies with the requirements of the Companies Act, 2013. Directors/KMPs shall be persons of sound integrity and honesty, apart from knowledge, experience etc in the respective fields.

No person less than the age of 21 years shall be appointed as the director of the Board. Composition of the Board shall be in compliance with the requirements of the Companies Act, 2013. The Executive Directors are paid with remuneration as approved by the members but are not paid sitting fees. Managing Director, Whole Time Director, Company Secretary and Chief Financial Officer shall be the Key Management Personnel (KMPs) of the Company. All persons who are Directors, KMPs, members of Senior Management and all the employees shall be abide by the code of conduct. Independent directors are not entitled for ESOPs

MANNER IN WHICH FORMAL ANNUAL EVALUATION HAS BEEN MADE BY THE BOARD OF ITS OWN PERFORMANCE AND THAT OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS

1. Nomination and Remuneration Committee of the Board prepared and sent through its Chairman Draft feedback form for evaluation of the Board and independent directors.

2. Independent Directors at a meeting of themselves considered and evaluated the Board''s performance, performance of the Chairman and other non-independent Directors.

3. The Board subsequently evaluated performance of the Board, the Committees and Independent Directors.

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

There were no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

All the related party transactions that were entered during the financial year were in the ordinary course of the business of the Company.

There were no materially significant related party transactions entered by the Company with its promoters, Directors, Key Management Personnel and other persons which may have a potential conflict with the interest of the Company.

All the related party transactions are placed before the Audit Committee for approval. For the business transactions with the related parties which are of repetitive nature as well as for the normal business transactions which cannot be foreseen prior omnibus approval from the Audit Committee are obtained and accordingly required disclosures are made to the Committee on quarterly basis in terms of the approval of the Committee.

The Policy on materiality of related party transactions and also on dealing with the related party transactions as approved by the Audit Committee and Board of Directors is uploaded on the Company''s web-site and the link for the same is https://www.nationalfitting.com.

The particulars of Contracts or Arrangements with the related parties made under Section 188 of the Companies Act, 2013 are furnished in Annexure - 1 and are attached to this report.

LISTING OF SHARES IN EXCHANGE AND DELISTING

The shares are listed in Bombay Stock Exchange and will be continued to be listed in Bombay Stock Exchange which has extensive networking and the investors have access to on-line dealings with the company''s securities across the country.

The Company duly paid the necessary listing fees with Bombay Stock Exchange.

shares

There was no issue of fresh equity shares during the financial year. No Bonus Shares were issued. The Company has not issued any Sweat Equity Shares and not provided any Employee Stock Option Scheme. The Company has not bought back any of its securities during the year under review.

INTERNAL Financial CONTROLS AND THEIR ADEQUACY

The Company has implemented adequate procedures and internal controls which provide reasonable assurance regarding reliability of financial reporting and preparation of financial statements.

The Company also assures that internal controls are operating effectively.

MATERIAL CHANGES AND COMMITMENTS

There were no material changes and commitments affecting the financial position of the company which have occurred between the end of the financial year and the date of the report.

risk management policy

Potential risk for the business of the Company and steps to be adopted by the Company to handle the risks has been reviewed regularly. Following are the few risks and the methods to be adopted by the Company to handle them.

1) Market Risk

Due to the continuing low crude oil prices the countries In the Middle East have reduced their spending on infrastructure like high rise residential buildings, shopping malls, hotels and convention halls where our products are being used in Fire Protection and Air Conditioning systems. Competitive prices from China have made it difficult to get approvals on new projects.

Backlog of orders for the existing projects will allow us to maintain our sale at reduced margin during the next 10 months. Company is working with the component suppliers to improve productivity and reduce costs. Steps have been taken by replacing the older equipments with relatively higher production machines to improve productivity in house and reduce costs.

2) Exchange Risk

Indian currency has appreciated 6% during the last 12 months where as the Chinese the major competitor have benefited by the depreciation of their currency by almost 7% during the same period.

Company may experience a reduction of margin during the current financial year, but we are hoping to improve the sales volume and quantum of margin to maintain the earning per share.

3) Power

Power situation has improved substantially during the year and do not expect any power cut during the current financial year.

4) Manpower Requirement

Company and Component Suppliers are depending on expat labor from the northern states for most of the operations. Frequent change of man power in critical operations are presenting a challenge in training of unskilled new labor.

Company has been increasing the salary and other benefit structure substantially to retain local and expat labor. Also steps have been taken to mechanize more of the operations, to improve productivity and utilizing semi-skilled labor.

5) Product Development

Most of the competitors have developed and started supplying all the items in our line of production for the fire protection markets at competitive prices.

Company has developed larger size fittings to HVAC market. Also the Company has developed and will be getting approval from testing agencies for new products to stay ahead of competition.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

A Board level Committee of CSR has been constituted and the Board has adopted a CSR Policy as recommended by the Committee.

The Company envisaged a project of constructing a school building at a Government Municipal School at Madhapur village at a cost of Rs 27 lacs. At present, the Company is pursuing the project.

The Annual Report on the Company''s CSR activities is furnished in Annexure 2 and attached to this report

ANNUAL RETURN

The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and administration) Rules, 2014 is furnished in Annexure 3 and is attached to this Report.

LEGAL COMPLIANCE

There were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company''s operations in future.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

The Company has unclaimed dividend amounting to Rs. 42,32,323/No amount is required to be transferred to Investor Education and Protection Fund for this financial year. DEPOSITS

The Company has neither accepted nor renewed any deposits during the financial year.

PARTICULARS OF EMPLOYEES

The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

(i) & (ii) The ratio of the remuneration of each Director to the median and mean remuneration of the employees of the company for the financial year and the percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:

Name of Directors/Key Management Personnel	Ratio to Median Remuneration (times)	% Increase / Decrease in Remuneration
Mr A V Palaniswamy, Managing Director	13.96	10.42
Mr Jayaram Govindarajan	2.11
Mr M Loganathan	0.13	NA

Mr R Alagar	0.95	8.70
Mrs A PanathAnitha	1.65	20.00
Mr J Saravanan (Chief Financial Officer)	3.39	25.36
Mr S Aravinthan (Company Secretary)	2.76	17.12

iii) The percentage increase in the median remuneration of employees in the financial year: 13%

iv) The number of permanent employees on the rolls of the Company: 85

v) Explanation on the relationship between average increase in remuneration and company performance:

On an average, employees received an increase of 22% during the financial year 2016-17. The remuneration components include a fair proportion of fixed and variable pay. The increase in remuneration is in line with the market. In order to ensure that remuneration reflects Company performance, the performance pay is also linked to organization performance, apart from an individual''s performance.

vi) Comparison of the remuneration of the key managerial personnel against the performance of the Company:

Aggregate remuneration of key managerial personnel (KMP) in FY 2016-17	45,31,142
Revenue	67,06,54,122
Remuneration of KMPs (as % of revenue)	0.68
Profit before Tax (PBT)	15,96,03,357
Remuneration of KMP (as % of PBT)	2.84

vii) Variations in the market capitalization of the Company, price earnings ratio as at the closing date of the current financial year and previous financial year:

(In Lacs)

Particulars	As at 31.03.2017	As at 31.03.2016	% Increase
Closing price of share at BSE (Rs.)	240	72.45	231.263
Market Capitalization (Rs.)	19968.00	6027.84	231.263
Price Earnings ratio	19.68	8.159	141.31
Net worth	2572.33	1958.43	31.35

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

The average increase in salaries of employees other than managerial personnel in 2016-17 was 23%. Percentage increase in the managerial remuneration for the year was 19%.

ix) Comparison of the each remuneration of the Key Managerial Personnel against the performance of the company:

	Mr. A V Palaniswamy Managing Director	Mr.Jayaram Govindarajan Whole Time Director	Mrs. A Panath Anitha, Woman Director	Mr. J Saravanan Chief Financial Officer	Mr. S Aravinthan Company Secretary
Remuneration in FY2016-17	26,50,000	4,00,000	3,13,642	6,43,000	5,24,500
Revenue	67,06,54,122	67,06,54,122	67,06,54,122	67,06,54,122	67,06,54,122
Remuneration as % of Revenue	0.40	0.06	0.05	0.10	0.08
Profit before Tax (PBT)	15,96,03,357	15,96,03,357	15,96,03,357	15,96,03,357	15,96,03,357
Remuneration (as % of PBT)	1.66	0.25	0.20	0.40	0.33

x) The key parameters for any variable component of remuneration availed by the directors: Not applicable.

xi) The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year: Not applicable.

xii) Affirmation that the remuneration is as per the remuneration policy of the company.

The Company affirms that remuneration is as per the remuneration policy of the Company

The information required under Section 197 of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2015 are given below:

During the period under review, there was no employee drawing remuneration in excess of the limits prescribed under Section 197 of the Companies Act, 2013 and Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

STATUTORY AUDITORS

The term of the Statutory Auditor M/s Krishaan & Co, has expired due to the stipulation of rotation of Auditors in the Companies Act, 2013 and M/s V Krish & Associates, Chartered Accountants, Chennai (Firm Registration No: 001452S) will be appointed as the Statutory Auditor until the conclusion of the 25th Annual General Meeting.

The Company has received a certificate from the Auditors for the appointment of them as statutory auditors and to the effect that if they are appointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.

Their appointment and payment of remuneration are to be confirmed and approved in the ensuing Annual General Meeting.

SECRETARIAL AUDIT REPORT

Pursuant to the requirements of the Companies Act, 2013, the Company has appointed Mr. M R L Narasimha,

B.Com, FCS, Practicing Company Secretary (Cop No: 799) as the Secretarial Auditor for the financial year 2017 whose report on 27th May, 2017 is attached separately to this report. Annexure 4.

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

There were no qualifications, reservations or adverse remarks made either by the Auditors or by the Practicing Company Secretary in their respective reports.

BOARD MEETINGS

I. BOARD OF DIRECTORS

a) Composition of Board of Directors:

Executive Promoter Director 1

Executive Non-Promoter Director 2

Non-Executive Independent Director 2

b) Non-Executive Directors Compensation

There are no pecuniary relationship/transactions with the Non-Executive Directors vis-a-vis the Company.

c) Board Meetings

Dates of Board meetings are fixed in advance and agenda papers are circulated to directors seven days before the meeting

d) Number of Board meetings conducted on the year under review

The Company had five Board meetings during the financial year under review as on 28.05.2016, 12.08.2016, 24.10.2016, 14.12.2016 and 09.02.2017. The AGM was held on 12.08.2016.

e) Attendance of Board of Directors at Board Meetings and AGM are:

S No	Name of the Directors	No of Board Meetings attended	Last AGM Present/Absent
1	Mr. A. V. Palaniswamy	5	Present
2	Mr. M. Loganathan	5	Present
3	Mr. R. Alagar	5	Present
4	Mrs. A. Panath Anitha	5	Present
5	Mr. Jayaram Govindarajan	3	Present

COMMITTEES OF THE BOARD

(A) AUDIT COMMITTEE:

(i) Composition

The Audit Committee of the Board comprises three directors, namely M.R. Alagar, Chairman, Mr. A.V. Palaniswamy and Mr. M. Loganathan, are members. The composition of Audit Committee meets the requirement of Section 177 of the Companies Act, 2013

Members of the Audit Committee have requisite financial and management expertise

(ii) Terms of reference

- Recommendation for appointment, remuneration and term of appointment of the auditors of the Company.

- Discussion and review of periodic audit reports and discussion with external Auditors about the scope of audit including the observations of Auditors.

- Review and monitor the auditor''s independence and performance

- Approving Internal Audit Plans and reviewing efficacy of the function.

- Overseeing Financial Reporting Process

- Reviewing periodic financial results, financial statements and auditors'' report thereon.

- Approval or modification of transaction of the company with related parties

- Scrutiny of inter-corporate loans and investments

- Evaluation of internal financial controls and risk management systems.

- Valuation of undertakings or assets of the Company.

(iii)Attendance

The committee met 4 times during the period on the following dates: 28.05.2016, 12.08.2016, 24.10.2016 and 09.02.2017

The Statutory Auditors, Internal Auditor and the Chief Financial Officer are invited to attend and participate at meetings of the Committee.

VIGIL MECHANISM

The Company has established a vigil mechanism and overseas through the committee the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of co employees and the Company.

(B) SHAREHOLDERS RELATIONSHIP COMMITTEE

The Shareholders / Investors Grievances Committee have been reconstituted as Shareholders Relationship Committee in line with Section 178 (5) of the Companies Act, 2013 and are headed by Mr. M Loganathan, Non-Executive Director.

The Committee monitors re-dressal of complaints received from shareholders/investors with respect to transfer of shares, non-receipt of dividend, non-receipt of Annual Report etc. The Committee also take note on number of transfers processed, issue of fresh share certificates, dematerialization of share certificates, report about top shareholders, share holding pattern etc.

There were no complaints received for this financial year. No instrument of transfers was pending on 31st March, 2017.

All the communication received from shareholders was satisfactorily complied with, within the stipulated time.

During the year the Committee met 7 times.

S Aravinthan, Company Secretary is the Compliance Officer.

The Company has appointed M/s. SKDC Consultants Limited, Coimbatore as Share Transfer Agent. Transfer/transmissions, issue of duplicate certificates etc as well as requests for de-materialization are approved/ confirmed, as the case may be, within the prescribed period through the above Share Transfer Agent. No valid transfer request remained pending for transfer to the transferees as on 31.03.2017.

(C) NOMINATION AND REMUNERATION COMMITTEE

The Company has a Remuneration Committee consists of Mr R Alagar, Independent Director, M Loganathan, Independent Director and Mr A V Palaniswamy, Non-Independent Director as members. Functions of the remuneration committee are

1) Level and composition of remuneration which is reasonable and attractive to retain and motivate quality directors

2) Monitoring the performance and remuneration of the directors, key managerial personnel and other employees of the Company.

The Remuneration of Whole Time Director is determined by the Remuneration Committee consists of only Non-Executive Directors. The recommendation of the remuneration committee are considered and approved by the Board subject to the approval of the Shareholders.

The company has not paid any remuneration to any of its Non Executive Directors, except the Sitting Fees for attending the meetings of the Board of Directors and Audit Committee

corporate governance

SEBI relaxed the applicability of Corporate Governance for certain companies (companies having paid up equity share capital not exceeding 10 crores and net worth not exceeding 25 crores as on the last day of the previous financial year) by SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The equity share capital of the company is 8.32 crores and net worth is 19.58 crores and as such Corporate Governance Report has not been submitted along with the Board Report.

The Board of Directors assuring that the Corporate Governance as stipulated in the Companies Act, 2013 have been fully complied with.

conservation of energy

a) Company has replaced most of the less efficient machines with newer and less power consuming equipments in all the areas of manufacturing.

b) Long term contract has been executed with wind energy suppliers there by reducing costs and less dependency on fossil fuel energy. Nearly 80% of the energy requirement will be from wind energy.

c) Company is also exploring the economic viability of installing its own wind mills to reduce cost of power.

TECHNOLOGY ABSORPTION INDuSTRIAL RELATIONS

Company has taken steps to introduce newer technology machines in production and inspection areas to increase productivity and reduce rejection levels.

Computer generated models for tooling, data collection and manufacturing processes have been introduced to improve productivity.

FOREIGN EXCHANGE EARNINGS AND OUTGO

Foreign exchange inflow (actual) : Rs. 57,75,49,322/Foreign exchange used (actual) : Rs. 1,63,81,365/INDUSTRIAL RELATIONS

Relationship with the employees/labor was cordial during the year under review.

ACKNOWLEDGEMENT

Your Directors take this opportunity to thank M/s. Bank of India for the support extended during the period. Your Directors also wish to thank all the suppliers, employees, Government Departments/Agencies and others for their valuable contribution and assistance during the year.

FOR AND ON BEHALF OF THE BOARD

Place : Coimbatore Sd/- A.V. PALANISWAMY Sd/- JAYARAM GOVINDARAJAN

Date : 27.05.2017 DIN No. 01817391 DIN No. 02178416

Managing Director Whole-Time Director

---

Mar 31, 2016

The Directors have pleasure in presenting the Twenty Third Annual Report together with the Audited Balance Sheet & Profit and Loss Account for the year ended 31.03.2016

FINANCIAL RESULTS

The operating results for the year 2015-2016 are given below: -

(Rs. in Lakhs)

Profit before Interest and Depreciation
and Other adjustments		1307.33
Less : Interest	75.69
Depreciation	121.36	197.06
Net Profit before Tax Provision for Tax :		1110.27
Current Tax	393.38
Deferred Tax (income) / expenses	(21.90)	371.48
Net Profit after Tax		738.79
Amount brought forward from previous year		368.25
Amount available for appropriation		1107.04
Appropriations
General Reserve		350.00
Interim Dividend on Equity Shares		166.40
Final Dividend on Equity Shares		83.20
Dividend Distribution Tax		50.81
Surplus carried over to Balance Sheet		456.63

FINANCIAL PERFORMANCE:

The Company''s gross income for the financial year ended 31st March, 2016 was Rs. 5,398.72 lacs compared to Rs.5, 048.54 lacs in the previous year. The profit before tax for the Company is Rs. 1,110.27 lacs as against Rs. 829.76 lacs in the previous year. The depreciation for the year is Rs.121.36 lacs compared to Rs.116 lacs in the previous year.

After providing Taxation, the Company''s net profit stands at Rs.738.79 lacs against Rs.549.72 lacs in the previous year.

Your company proposes to transfer Rs. 350 lacs to General Reserve out of the amount available for appropriation and an amount of Rs. 456.63 lacs is to be carried over to Balance Sheet after appropriation of Dividend on Preference Shares and Equity Shares including Dividend Tax.

The Net worth of the company is at Rs.1958.44 lacs as on 31.03.2016 as against Rs.1820.05 lacs in the previous year.

DIVIDEND

The Board of Directors declared an interim dividend of Rs 2/- per Equity Share on 83, 20,000 equity shares of Rs 10/- each aggregating to Rs 166.40 lacs on 16.03.2016 and the dividend had been distributed to the shareholders. The approval of the shareholders has been perused in this Annual General Meeting.

The Board of Directors has recommended a final dividend of Re 1/- per Equity share on 83, 20,000 equity shares Rs 10/- each aggregating to Rs 83.20 lacs for the financial year ended 31st March, 2016, which if approved in the ensuing Annual General Meeting will be paid to all the equity shareholders, whose names appear in the Register of Members as on 05h August, 2016.

With the approval of the final dividend the total dividend for the financial year ended 31st March 2016 has been Rs. 3/- per share (Rs. 249.6 lacs).

REDEMPTION OF 9% NON-CONVERTIBLE NON-CUMULATIVE REDEEMABLE PREFERENCE SHARES

The company had redeemed 3,00,000 9% Non-Convertible Non-Cumulative Redeemable Preference shares of Rs 100/- each amounting to Rs 300 lacs on 14.08.2015.

PERFORMANCE:

Sales and margins improved due to increase in the purchase of castings from reliable outsources and favorable foreign exchange conditions. In spite of price reduction due to severe competition from China, Company has been able to reduce production costs and thus improving margins.

Company expects to improve sales and margin due to improved power situation and increase in production. MANAGEMENT DISCUSSION AND ANALYSIS REPORT TRENDS & DEVELOPMENT

The Company has a comfortable back order position in spite of a slowdown in the Middle East market. “Make in India” movement by the Government has not improved the domestic market segment as anticipated last year.

Products for joining 2” and under pipe sizes have been approved by the testing agencies and will start production during the financial year 2016-2017.

DIRECTORS

Mrs Panath Anitha, Whole Time Director, who retires by rotation, and being eligible, offers herself for reappointment.

KEY MANAGEMENT PERSONNEL

Mr. A.V. Palaniswamy, Managing Director, Mrs Panath Anitha, Whole Time Director, Mr. J. Saravanan, Chief Financial Officer and Mr. S. Aravinthan, Company Secretary of the Company are the Key Management Personnel as per the provisions of the Companies Act, and rules made there under.

Subsidiaries, joint ventures and associate companies

The company does not have any Subsidiary, Joint Venture or Associate Company COMPANY''S PHILOSOPHY ON CODE OF CORPORATE GOVERNANCE

The Company sustains to develop, manufacture and supply effective products to meet the customer requirements

The striving towards continuous improvement in total quality and keeping abreast of the latest technologies have been enabling the Company to achieve its goal.

The focus on training and development of the employees'' skills has well bearing results in the goal attainment.

The ultimate benefit of these efforts has been aimed in enrichment of the value to the shareholders. The environment and Community has been well recognized while moving towards the goal.

DIRECTORS’ RESPONSIBILITY STATEMENT

Your Directors further report that

(i) In the preparation of annual accounts, the applicable accounting standards have been followed and there were no material departures;

(ii) The accounting policies selected have been applied consistently, prudent judgments and estimates have been made to give a true and fair view of the state of affairs of the company as at 31st March 2016 and of the Profit of the company and the cash flow statement for the year ended 31.03.2016.

(iii) There 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 annual accounts have been prepared on a going concern basis.

(v) The directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively

Internal financial control means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

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

CODE OF CONDUCT

All Directors and senior management of the Company have affirmed Compliance with the Code of Conduct of National Fittings Limited for the financial Year ended 31st March 2016.

DECLARATION OF INDEPENDENT DIRECTORS

The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

POLICY ON DIRECTOR’S APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES, INDEPENDENCE OF A DIRECTOR, KEY MANAGEMENT PERSONNEL AND OTHER employees

The company shall have such person on the Board who complies with the requirements of the Companies Act, 2013. Directors/KMPs shall be persons of sound integrity and honesty, apart from knowledge, experience etc in the respective fields.

No person less than the age of 21 years shall be appointed as the director of the Board.

Composition of the Board shall be in compliance with the requirements of the Companies Act, 2013. The Executive Directors are paid with remuneration as approved by the members but are not paid sitting fees. Managing Director, Whole Time Director, Company Secretary and Chief Financial Officer shall be the Key Management Personnel (KMPs) of the Company.

All persons who are Directors, KMPs, members of Senior Management and all the employees shall be abide by the code of conduct. Independent directors are not entitled for ESOPs

MANNER IN WHICH Formal ANNUAL EVALUATION Has BEEN Made By The Board Of Its own performance and that of its committees and individual directors

1. Nomination and Remuneration Committee of the Board prepared and sent through its Chairman Draft feedback form for evaluation of the Board and independent directors.

2. Independent Directors at a meeting of themselves considered and evaluated the Board''s performance, performance of the Chairman and other non-independent Directors.

3. The Board subsequently evaluated performance of the Board, the Committees and Independent Directors.

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

There were no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable.

PARTICULARS OF CONTRACTS OR arrangements MADE WITH RELATED PARTIES

All the related party transactions that were entered during the financial year were in the ordinary course of the business of the Company.

There were no materially significant related party transactions entered by the Company with its promoters, Directors, Key Management Personnel and other persons which may have a potential conflict with the interest of the Company.

All the related party transactions are placed before the Audit Committee for approval. For the business transactions with the related parties which are of repetitive nature as well as for the normal business transactions which cannot be foreseen prior omnibus approval from the Audit Committee are obtained and accordingly required disclosures are made to the Committee on quarterly basis in terms of the approval of the Committee.

The Policy on materiality of related party transactions and also on dealing with the related party transactions as approved by the Audit Committee and Board of Directors is uploaded on the Company''s web-site and the link for the same is https://www.nationalfitting.com.

The particulars of Contracts or Arrangements with the related parties made under Section 188 of the Companies Act, 2013 are furnished in Annexure - 1 and are attached to this report.

LISTING OF SHARES IN EXCHANGE AND DELISTING

The shares are listed in Bombay Stock Exchange and will be continued to be listed in Bombay Stock Exchange which has extensive networking and the investors have access to on-line dealings with the company''s securities across the country.

The Company duly paid the necessary listing fees with Bombay Stock Exchange.

Shares There was no issue of fresh equity shares during the financial year. No Bonus Shares were issued. The Company has not issued any Sweat Equity Shares and not provided any Employee Stock Option Scheme.

The Company has not bought back any of its securities during the year under review.

INTERNAL FINANCIAL CONTROLS AND THEIR adequacy

The Company has implemented adequate procedures and internal controls which provide reasonable assurance regarding reliability of financial reporting and preparation of financial statements.

The Company also assures that internal controls are operating effectively.

MATERIAL CHANGES AND COMMITMENTS

There were no material changes and commitments affecting the financial position of the company which have occurred between the end of the financial year and the date of the report.

Risk management policy

Potential risk for the business of the Company and methods to handle those risks have been reviewed and monitored regularly. Few risks and the steps taken for handling them have been detailed below:

1) Sourcing of Component

Company is witnessing an increasing trend of Chinese products acceptance in the market due to the longer delivery periods requested by the Company.

Company is taking steps to increase the production capacities of the component suppliers and additional manufacturing capacity will be created in house for all the components made in house and processing.

2) Market Risk

Oil prices have not improved in the Middle East market to continue the expansion in the infrastructure projects where most of our products are utilized.

Company is exploring alternate markets like Africa, Iran and Australia in spite of larger presence of Chinese products. Expecting the domestic markets to improve in the infra structure areas.

3) Exchange Risk

Company is expecting the exchange rate to be stable due to RBI policies and the risks have diminished considerably.

4) Manpower Requirement

Products manufactured by the Company are labor intensive and the Company and Component Suppliers are facing shortage of skilled local labor. Presently Company is employing 60% of the man power requirement from outside the State and the economies of those states improve, there is a likelihood of 60% labor to move back.

Company and component suppliers are taking steps to modernize the manufacturing methods by mechanization and automation. Special purpose machines are being envisaged to reduce labor.

5) Power

Power cuts have been removed from 15th June, but interruption of power are still prevalent. Unless the financial condition of the state power supply companies are improved, there may be more interruption due to unwillingness of the private power production to supply power to state owned companies.

Company is taking steps to buy power directly from private power producers through the dedicated feeders.

6) Chinese Factor

Chinese economy is projected to slow down further and due to higher production capacities in our product lines, the Chinese companies are increasingly entering the export markets like Middle East, Africa, and India. Chinese Government is funding the infrastructure projects in these countries and the Chinese companies are preferred for all supplies over other countries. Export from India to Middle East has decreased considerably due to this Chinese factor in all areas.

Company will maintain the market share with shorter deliveries due to the increased production capacities and introduction of new product design and new products.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

A Board level Committee of CSR has been constituted and the Board has adopted a CSR Policy as recommended by the Committee.

The Annual Report on the Company''s CSR activities is furnished in Annexure 2 and attached to this report

Annual return

The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and administration) Rules, 2014 is furnished in Annexure 3 and is attached to this Report.

LEGAL COMPLIANCE

There were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company''s operations in future.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND

The Company has unclaimed dividend amounting to Rs 6304442/No amount is required to be transferred to Investor Education and Protection Fund for this financial year.

DEPOSITS

The Company has neither accepted nor renewed any deposits during the financial year.

PARTICULARS OF EMPLOYEES

The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

(i) & (ii) The ratio of the remuneration of each Director to the median and mean remuneration of the employees of the company for the financial year and the percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:

Name of Directors/Key Management Personnel	Ratio to Median Remuneration (times)	% Increase / Decrease in Remuneration
Mr A V Palaniswamy, Managing Director	37.87	84.62
Mr M Loganathan	0.36	58.62
Mr R Alagar	2.37	93.55
Mrs A Panath Anitha	3.95	19.14
Mr J Saravanan (Chief Financial Officer)	8.66	8.93
Mr S Aravinthan (Company Secretary)	7.03	9.19

iii) The percentage increase in the median remuneration of employees in the financial year : 6%

iv) The number of permanent employees on the rolls of the Company: 76

v) Explanation on the relationship between average increase in remuneration and company performance:

On an average, employees received an increase of 4% during the financial year 2015-16. The remuneration components include a fair proportion of fixed and variable pay. The increase in remuneration is in line with the market. In order to ensure that remuneration reflects Company performance, the performance pay is also linked to organization performance, apart from an individual''s performance.

vi). Comparison of the remuneration of the key managerial personnel against the performance of the Company:

Aggregate remuneration of key managerial personnel (KMP) in FY16	3644700
Revenue	521858665
Remuneration of KMPs (as % of revenue)	0.70
Profit before Tax (PBT)	111027428
Remuneration of KMP (as % of PBT)	3.28

vii) Variations in the market capitalization of the Company, price earnings ratio as at the closing date of the current financial year and previous financial year:

(In Lacs)

Particulars	As at31.03.2016	As at 31.03.2015	% Increase
Closing price of share at BSE (Rs.)	72.45	74.90	(3.271)
Market Capitalization (Rs.)	6027.84	6231.68	(3.271)
Price Earnings ratio	8.159	12.04	(32.24)
Net worth	1958.43	1820.06	7.60

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

The average increase in salaries of employees other than managerial personnel in 2015-16 was 4%. Percentage increase in the managerial remuneration for the year was 50%.

ix) Comparison of the each remuneration of the Key Managerial Personnel against the performance of the company:

	Mr. A V Palaniswamy Managing Director	Ms. A PanathaAnitha Whole Time Director	Mr. J Saravanan ChiefFinancialOfficer	Mr. S Aravinthan Company Secretary
Remuneration in FY16	2400000	250200	549000	445500
Revenue	521858665	521858665	521858665	521858665
Remuneration as % of Revenue	0.46	0.05	0.11	0.09
Profit before Tax (PBT)	111027428	111027428	111027428	111027428
Remuneration (as % of PBT)	2.16	0.23	0.49	0.40

x) The key parameters for any variable component of remuneration availed by the directors:

Not applicable.

xi) The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year; and

Not applicable.

xii) Affirmation that the remuneration is as per the remuneration policy of the company.

The Company affirms that remuneration is as per the remuneration policy of the Company.

The information required under Section 197 of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2015 are given below:

During the period under review, there was no employee drawing remuneration in excess of the limits prescribed under Section 197 of the Companies Act, 2013 and Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Statutory auditors

M/s Krishaan & Co., Chartered Accountants, Chennai were appointed as Statutory Auditors of the Company from the conclusion of the Annual General Meeting held on 14.08.2015 until the conclusion of forth Annual General Meeting to be held after that meeting. The Company has received a certificate from the above Auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.

Their continuance of appointment and payment of remuneration are to be confirmed and approved in the ensuing Annual General Meeting.

Secretarial audit REPORT

Pursuant to the requirements of the Companies Act, 2013, the Company has appointed Mr M R L Narasimha, B.com, FCS, Practicing Company Secretary (Cop No: 799) as the Secretarial Auditor for the financial year 2016 whose report on 28th May, 2016 is attached separately to this report. Annexure 4.

EXPLANATION OR COMMENTS ON Qualifications, RESERVATIONS OR ADVERSE Remarks OR DISCLAIMERS MADE BY the Auditors AND the Practicing COMPANY SECRETARY IN THEIR REPORTS

There were no qualifications, reservations or adverse remarks made either by the Auditors or by the Practicing Company Secretary in their respective reports.

BOARD MEETINGS

I. BOARD OF DIRECTORS

a) Composition of Board of Directors:

Executive Promoter Director 1

Executive Non-Promoter Director 1

Non-Executive Independent Director 2

b) Non-Executive Directors Compensation

There are no pecuniary relationship/transactions with the Non-Executive Directors vis-a-vis the Company.

c) Board Meetings

Dates of Board meetings are fixed in advance and agenda papers are circulated to directors seven days before the meeting

d) Number of Board meetings conducted on the year under review

The Company had five Board meetings during the financial year under review as on 29.05.2015, 14.08.2015, 13.11.2015, 12.02.2016 and 16.03.2016. The AGM was held on 14.08.2015.

e) Attendance of Board of Directors at Board Meetings and AGM are:

S No	Name of the Directors	No of Board Meetings attended	Last AGM Present/Absent
1	Mr. A. V. Palaniswamy	5	Present
2	Mr. M. Loganathan	5	Present
3	Mr. R. Alagar	5	Present
4	Mrs. A. Panath Anitha	5	Present

COMMITTEES OF THE BOARD

(A) AUDIT COMMITTEE:

(i) Composition

The Audit Committee of the Board comprises three directors, namely M. R. Alagar, Chairman, Mr A.V. Palaniswamy and Mr. M. Loganathan, members. The composition of Audit Committee meets the requirement of Section 177 of the Companies Act, 2013

Members of the Audit Committee have requisite financial and management expertise

(ii) Terms of reference

- Recommendation for appointment, remuneration and term of appointment of the auditors of the Company.

- Discussion and review of periodic audit reports and discussion with external Auditors about the scope of audit including the observations of Auditors.

- Review and monitor the auditor''s independence and performance

- Approving Internal Audit Plans and reviewing efficacy of the function.

- Overseeing Financial Reporting Process

- Reviewing periodic financial results, financial statements and auditors'' report thereon.

- Approval or modification of transaction of the company with related parties

- Scrutiny of inter-corporate loans and investments

- Evaluation of internal financial controls and risk management systems.

- Valuation of undertakings or assets of the Company.

(iii) Attendance

The committee met 4 times during the period on the following dates: 29.05.2015, 14.08.2015, 13.11.2015 and 12.02.2016

The Statutory Auditors, Internal Auditor and the Chief Financial Officer are invited to attend and participate at meetings of the Committee.

VIGIL MECHANISM

The Company has established a vigil mechanism and overseas through the committee the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of co employees and the Company.

(B) SHAREHOLDERS RELATIONSHIP COMMITTEE

The Shareholders / Investors Grievances Committee have been reconstituted as Shareholders Relationship Committee in line with Section 178 (5) of the Companies Act, 2013 and are headed by Mr M Loganathan, Non-Executive Director.

The Committee monitors re-dressed of complaints received from shareholders/investors with respect to transfer of shares, non-receipt of dividend, non-receipt of Annual Report etc. The Committee also take note on number of transfers processed, issue of fresh share certificates, dematerialization of share certificates, report about top shareholders, share holding pattern etc.

There were no complaints received for this financial year. No instrument of transfers was pending on 31st March; 2016.All the communication received from shareholders was satisfactorily complied with, within the stipulated time. During the year the Committee was met 10 times. S Aravinthan, Company Secretary is the Compliance Officer.

The Company has appointed M/s. SKDC Consultants Limited, Coimbatore as Share Transfer Agent. Transfer/transmissions, issue of duplicate certificates etc as well as requests for de-materialization are approved/ confirmed, as the case may be, within the prescribed period through the above Share Transfer Agent. No valid transfer request remained pending for transfer to the transferees as on 31.03.2016.

(C) NOMINATION AND REMUNERATION COMMITTEE

The Company has a Remuneration Committee consists of Mr R Alagar, Independent Director, M Loganathan, Independent Director and Mr A V Palaniswamy, Non-Independent Director as members. Functions of the remuneration committee are

1) Level and composition of remuneration which is reasonable and attractive to retain and motivate quality directors

2) Monitoring the performance and remuneration of the directors, key managerial personnel and other employees of the Company.

The Remuneration of Whole Time Director is determined by the Remuneration Committee consists of only Non-Executive Directors. The recommendation of the remuneration committee are considered and approved by the Board subject to the approval of the Shareholders.

The company has not paid any remuneration to any of its Non Executive Directors, except the Sitting Fees for attending the meetings of the Board of Directors and Audit Committee

Corporate governance

SEBI relaxed the applicability of Corporate Governance for certain companies (companies having paid up equity share capital not exceeding 10 crores and net worth not exceeding 25 crores as on the last day of the previous financial year) by SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The equity share capital of the company is 8.32 crores and net worth is 19.58 crores and as such Corporate Governance Report has not been submitted along with the Board Report.

The Board of Directors assuring that the Corporate Governance as stipulated in the Companies Act, 2013 have been fully complied with.

Conservation of energy

a) On the assumption that power cut will be lifted and that power interruptions will be substantially reduced, the company is proposing to replace the existing power intensive, less efficient machines with newer CNC machines.

b) Continuous melting operation will reduce the existing power consumption per ton of metal considerably.

c) The molding operation will be continuous and this will reduce power consumption per ton of castings..

Technology ABSORPTION

Company has developed the fittings for 2” and under pipe sizes and will be the second company in the world to produce and market in Ductile Iron.

Company has developed several items in Stainless Steel products for railway brake systems and water treatment plants.

Grooved products are being re-designed to reduce material content and minimize processing periods.

FOREIGN EXCHANGE EARNINGS AND Outgo

Foreign exchange inflow (actual) : Rs. 41, 90, 55,528/

Foreign exchange used (actual) : Rs. 1, 00, 47,048/

INDUSTRIAL RELATIONS

Relationship with the employees/labor was cordial during the year under review.

Acknowledgement

Your Directors take this opportunity to thank M/s. Bank of India for the support extended during the period. Your Directors also wish to thank all the suppliers, employees, Government Departments/Agencies and others for their valuable contribution and assistance during the year.

FOR AND ON BEHALF OF THE BOARD

Place: Coimbatore SD/- A.V. PALANISWAMY Sd/- M. LOGANATHAN

Date: 28.05.2016 DIN No. 01817391 DIN No. 01936839

Managing Director Director

---

Mar 31, 2015

THE SHAREHOLDERS

The Directors have pleasure in presenting the Twenty Second Annual Report together with the Audited Balance Sheet & Profit and Loss Account for the year ended 31.03.2015

financial results

The operating results for the year 2014-2015 are given below :

( in Lakhs)

Profit before Interest and Depreciation and Other adjustments 1052.76

Less : Interest 107.00

Depreciation 116.00 223.00

Net Profit before Tax 829.76

Provision for Tax :

Current Tax 293.15

IT for earlier years 5.60

Deferred Tax (income) / expenses (18.70)

280.05

Net Profit after Tax 549.71

Amount brought forward from previous year 1.31

Amount available for appropriation 551.02

Appropriations

General Reserve 50.00

Dividend on Preference Shares 27.00

Dividend on Equity Shares 83.20

Dividend Distribution Tax 22.56

Surplus carried over to Balance Sheet 368.26

FINANCIAL PERFORMANCE:

The Company's gross income for the financial year ended 31st March, 2015 was Rs. 5,048.54 lacs compared to Rs. 3,732.48 lacs in the previous year. The profit before tax for the Company is Rs. 829.76 lacs as against Rs. 558.76 lacs in the previous year. The depreciation for the year is Rs.116 lacs compared to Rs.72 lacs in the previous year.

After providing Taxation, the Company's net profit stands at Rs. 549.71 lacs against Rs.335.90 lacs in the previous year.

Your company proposes to transfer Rs 50 lacs to General Reserve out of the amount available for appropriation and an amount of Rs.368.26 lacs is to be carried over to Balance Sheet after appropriation of Dividend on Preference Shares and Equity Shares including Dividend Tax.

The Net worth of the company is at Rs.1820.05 lacs as on 31.03.2015 as against Rs.1603.10 lacs in the previous year.

dividend

The Board of Directors has recommended a dividend of Rs 9/- per Preference Share on 300000 9% Redeemable Non-Convertible Non-Cumulative Preference shares of Rs 100/- each aggregating to Rs 27 lacs excluding dividend tax for the financial year ended 31st March, 2015.

The Board of Directors has recommended a dividend of Re 1/- per Equity share on 83,20,000 equity shares Rs 10/- each aggregating to Rs 83.20 lacs for the financial year ended 31st March, 2015, which if approved in the ensuing Annual General Meeting will be paid to all the equity shareholders, whose names appear in the Register of Members as on 14th August, 2015.

REDEMPTION OF 9% NON-CONVERTIBLE NON-CUMULATIVE REDEEMABLE

preference shares

The company has considered the option of redeeming the remaining 3,00,000 9% Non-Convertible Non-Cumulative Redeemable Preference shares of Rs 100/- each amounting to Rs 300 lacs which was approved by Board at their meeting on 29.05.2015.

PERFORMANCE:

Sales and margins improved due to increase in the purchase of castings from reliable outsources and favourable foreign exchange conditions. In spite of price reduction due to severe competition from China, Company has been able to reduce production costs and thus improving margins.

Company expects to improve sales and margin due to improved power situation and increase in production.

Management discussion and analysis report trends & development

Middle East market where most of the products are sold has not witnessed a slowdown in construction and hence the demand for products has not reduced. Company is enjoying a healthy back order position for its products.

Domestic market penetration is increasing due to the awareness of "Made in India" approach of the Government from the end users of the product in Indian market.

Company has developed a new line of products for joining pipes of 2" and below. The new product line will contribute up to 20% of sales of the Company in the future years.

DIRECTORS:

Mrs Panath Anitha, was appointed as Additional Director on 14.02.2015 and holds the said office till the date of the Annual General Meeting. A notice has been received from a member proposing her candidature for her reappointment.

Mr A.V. Palaniswamy, Director, who retires by rotation, and being eligible, offers himself for reappointment.

Chief financial officer

Mr. J. Saravanan, M.Com., MBA, is the Chief Financial Officer of the Company.

COMPANY SECRETARY:

Mr. S. Aravinthan, ACS, is the Company Secretary and Compliance officer of the Company.

Subsidiaries, joint ventures and associate companies

The company does not have any Subsidiary, Joint Venture or Associate Company COMPANY'S PHILOSOPHY ON CODE OF CORPORATE GOVERNANCE

The Company sustains to develop, manufacture and supply effective products to meet the customer requirements

The striving towards continuous improvement in total quality and keeping abreast of the latest technologies to enable the Company in achieving its goal.

The focus on training and development of the employees' skills are the core areas in attaining the goal.

The ultimate benefit of these efforts has been aimed at enriching the value to the shareholders.

The environment and Community have to be recognized while moving towards the goal.

DIRECTORS' RESPONSIBILITY STATEMENT

Your Directors further report that

(i) in the preparation of annual accounts, the applicable accounting standards have been followed and there were no material departures;

(ii) the accounting policies selected have been applied consistently, prudent judgments and estimates have been made to give a true and fair view of the state of affairs of the company as at 31st March 2015 and of the Profit of the company and the cash flow statement for the year ended 31.03.2015.

(iii) there 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 annual accounts have been prepared on a going concern basis.

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

Internal financial control means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business including adherence to Company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

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

Code of conduct

All Directors and senior management of the Company have affirmed Compliance with the Code of Conduct of National Fittings Limited for the financial Year ended 31st March 2015

Number of board meetings conducted during the year under review

The Company had four Board meetings during the financial year under review as on 30.05.2014, 14.08.2014, 14.11.2014 and 14.02.2015

Declaration of independent directors

The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FOR

Determining qualifications, positive attributes, independence of a director, key management personnel and other employees

The company shall have such person on the Board who complies with the requirements of the Companies Act, 2013. No person less than the age of 21 years shall be appointed as the director of the Board. Directors/KMPs shall be persons of sound integrity and honesty, apart from knowledge, experience etc in the respective fields.

Composition of the Board shall be in compliance with the requirements of the Companies Act, 2013.

Managing Director, Company Secretary and Chief Financial Officer shall be the Key Management Personnel (KMPs) of the Company.

All persons who are Directors, KMPs, members of Senior Management and all the employees shall be abide by the code of conduct.

The Executive Directors are paid with remuneration as approved by the members but are not paid sitting fees. Independent directors are not entitled for ESOPs

Manner in which formal annual evaluation has been made by the board of its own performance and that of its committees and individual directors

1. Nomination and Remuneration Committee of the Board prepared and sent through its Chairman draft feedback form for evaluation of the Board and independent directors

2. Independent Directors at a meeting of themselves considered and evaluated the Board's performance, performance of the Chairman and other non-independent Directors.

3. The Board subsequently evaluated performance of the Board, the Committees and Independent Directors

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

There were no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable.

particulars of contracts or arrangements made with related parties

The particulars of Contracts or Arrangements made with related parties made pursuant to Section 188 are furnished in Annexure 1 and are attached to this report.

listing of shares in exchange and delisting

The shares are listed in Bombay Stock Exchange and will be continued to be listed in Bombay Stock Exchange which has extensive networking and the investors have access to on-line dealings with the company's securities across the country. The Company duly paid the necessary listing fees with Bombay Stock Exchange.

The company's shares have not been traded in Madras Stock Exchange for the past few years. Members' approval has already been obtained for De-listing the Company's equity shares from Madras stock

Exchange. Moreover the Madras Stock Exchange in May last year, had made a request to SEBI to exit as bourse. Even among such situations, the Company duly paid the necessary listing fees with Madras Stock Exchange.

Shares

No Bonus Shares were issued and the Company has not bought back any of its securities during the year under review. The Company has not issued any Sweat Equity Shares and not provided any Employee Stock Option Scheme.

The details in respect of adequacy of internal financial controls

The Board is of the opinion that the Company has sound Internal Financial Controls commensurate with the nature and size of the business operations. The controls are in place and operate efficiently and no material weakness exists. A process is also in place to continuously monitor the existing controls and improving the same as and when needed.

Material changes and commitments

There were no material changes and commitments affecting the financial position of the company which have occurred between the end of the financial year and the date of the report.

risk management policy

Potential risk for the business of the Company and methods to handle those risks have been reviewed and monitored regularly. Few risks and the steps taken for handling them have been detailed below:

1) Sourcing of Component

Components sourced from outside are not an attractive item to produce and hence outside sources of components may decline to accept the order from the Company due to increase in order for their profitable items from improving economic conditions in India and elsewhere.

Company has made arrangements with Holding Company and a related company for dedicated supply of components at competitive prices.

2) Market Risk

Middle East market could shrink in volume for the products if oil prices drop below viable levels for those countries to continue in building and infra structure development.

Company is expanding into other markets and increasing its presence in the domestic market substantially. Present share of sales of 10% in the domestic market will increase to 25% to 30% in the coming years.

3) Exchange rate

Since 90% of the cost of production involves domestically procured materials and services, strengthening of the rupee due to possible heavy inflow of foreign capital could affect the profitability of the company

Company will continue to expand in domestic market to maintain its sales and margins.

4) Chinese factor

Due to slowing Chinese economy and expanded manufacturing capacities, most Chinese companies involved in our product lines are entering the export markets including India and offering low prices to stay in business.

With the establishment of the dedicated facilities through associate companies, we expect our production cost to be lower in the coming months and stay competitive. We hope the "Make in India" policy of the Government will translate in to reduction in cost of inputs, service and infra structure costs related to manufacturing industries.

Maintaining the established quality standards, timely deliveries and service will enable us to keep our customer base and price alone may not be a factor.

5) Power cuts

We expect the power costs to increase in the coming years to sustain the state owned electricity departments. As a result being a power intensive component manufacturing set up, the cost of production might increase and may not be possible to pass the cost increase to the buyers.

Company will take steps to install renewable energy generation like wind mills or solar to offset the power cost increase.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

A Board level Committee of CSR has been constituted and the Board has adopted a CSR Policy as recommended by the Committee.

The Annual Report on the Company's CSR activities is furnished in Annexure 2 and attached to this report

Annual return

The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and administration) Rules, 2014 is furnished in Annexure 3 and is attached to this Report.

Legal compliance

There were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future.

Transfer of unclaimed dividend to investor eduction and protection fund

The Company has unclaimed dividend amounting to Rs 6,25,810/- No amount is required to be transferred to Investor Education and Protection Fund for this financial year.

Deposits

The Company has neither accepted nor renewed any deposits during the financial year.

Particulars of employees

The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

(i) & (ii) The ratio of the remuneration of each Director to the median and mean remuneration of the employees of the company for the financial year and the percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:

Ratio to Median % Increase / Name of Directors/Key Remuneration Decrease in (times) Remuneration Management Personnel

Mr. A.V. PALANISWAMY, Managing Director 12.88 33.33

Mr. M LOGANATHAN 0.49 —

Mr. R ALAGAR 1.20 24.63

Mrs. PANATH ANITHA, Non Executive Director (w.e.f. 0.35 — 14.02.2015)*

Mr. J SARAVANAN, Chief Financial Officer 3.03 — (w.e.f. 01.10.2014)*

Mr. S. ARAVINTHAN, Company Secretary 4.68 17.46

*Since this information is for part of the year, the same is not comparable.

iii) The percentage increase in the median remuneration of employees in the financial year : 9%

iv) The number of permanent employees on the rolls of the Company : 125

v) Explanation on the relationship between average increase in remuneration and company performance:

On an average, employees received an increase of 20.90% during the financial year 2014-15. The remuneration components include a fair proportion of fixed and variable pay. The increase in remuneration is in line with the market. In order to ensure that remuneration reflects Company performance, the performance pay is also linked to organization performance, apart from an individual's performance.

vi) Comparison of the remuneration of the key managerial personnel against the performance of the Company:

Aggregate remuneration of key managerial personnel (KMP) in FY15 20,93,514

Revenue 495,329,986

Remuneration of KMPs (as % of revenue) 0.42

Profit before Tax (PBT) 82,975,797

Remuneration of KMP (as % of PBT) 2.52

vii) Variations in the market capitalisation of the Company, price earnings ratio as at the closing date of the current financial year and previous financial year:

(In Lacs) Particulars As at 31.03.2015 As at 31.03.2014 % Increase

Closing price of share at NSE (Rs.) 74.90 5.83 1169.30

Market Capitalisation (Rs.) 6231.68 485.056 1169.30

Price Earnings ratio 11.90 1.71 593.83

Net worth 1,820.06 1,603.10 13.53

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

The average increase in salaries of employees other than managerial personnel in 2014-15 was 20.90%. Percentage increase in the managerial remuneration for the year was 22%.

ix) Comparison of the each remuneration of the Key Managerial Personnel against the performance of the company:

Mr. A.V. PALANISWAMY, Mr. J SARAVANAN, Mr. S. ARAVINTHAN, Managing Director Chief Financial Company Secretary Officer

Remuneration in FY15 13,00,000 3,05,703 4,52,811

Revenue 495,329,986 495,329,986 495,329,986

Remuneration as % of 0.26 0.06 0.09 Revenue

Profit before Tax (PBT) 82,975,797 82,975,797 82,975,797

Remuneration (as % of PBT) 1.57 0.37 0.55

x) The key parameters for any variable component of remuneration availed by the directors:

Not applicable.

xi) The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year; and

Not applicable.

xii) Affirmation that the remuneration is as per the remuneration policy of the company.

The Company affirms that remuneration is as per the remuneration policy of the Company.

The information required under Section 197 of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

During the period under review, there was no employee drawing remuneration in excess of the limits prescribed under Section 197 of the Companies Act, 2013 and Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

statutory auditors

M/s Krishaan & Co., Chartered Accountants, Chennai were appointed as Statutory Auditors of the Company from the conclusion of the Annual General Meeting held on 14.08.2014 until the conclusion of forth Annual General Meeting to be held after that meeting. The Company has received a certificate from the above Auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013. Their continuance of appointment and payment of remuneration are to be confirmed and approved in the ensuing Annual General Meeting.

secretarial audit report

Pursuant to the requirements of the Companies Act, 2013, the Company has appointed Mr M R L Narashimha, B.Com, ACS, Practicing Company Secretary (Cop No: 799) as the Secretarial Auditor for the financial year 2015 whose report on 29th May, 2015 is attached separately to this report. Annexure 4.

explanation or comments on qualifications, reservations or adverse remarks or disclaimers made by the auditors and the practicing company secretary in their reports

There were no qualifications, reservations or adverse remarks made by the Auditor in their Report. The remarks made by the Practising Company Secretary in his report with respect to non-adoption of Code of Conduct of Insider Trading Regulations and non filing of Form MR1 with respect to appointment of CFO will be complied with.

disclosure of composition of audit committee and providing vigil mechanism and other committees of the board

(A) AUDIT COMMITTEE:

(i) Composition

The Audit Committee of the Board comprises three directors, namely M. R. Alagar, Chairman, Mr A.V. Palaniswamy and Mr. M. Loganathan, members. The composition of Audit Committee meets the requirement of Section 177 of the Companies Act, 2013

Members of the Audit Committee have requisite financial and management expertise

(ii) Terms of reference

- Recommendation for appointment, remuneration and term of appointment of the auditors of the Company.

- Discussion and review of periodic audit reports and discussion with external Auditors about the scope of audit including the observations of Auditors.

- Review and monitor the auditor's independence and performance

- Approving Internal Audit Plans and reviewing efficacy of the function.

- Overseeing Financial Reporting Process

- Reviewing periodic financial results, financial statements and auditors' report thereon.

- Approval or modification of transaction of the company with related parties

- Scrutiny of inter-corporate loans and investments

- Evaluation of internal financial controls and risk management systems.

- Valuation of undertakings or assets of the Company.

(iii) Attendance

The committee met 4 times during the period on the following dates: 30.05.2014, 14.08.2014, 14.11.2014 and 14.02.2015

The Statutory Auditors, Internal Auditor and the Chief Financial Officer are invited to attend and participate at meetings of the Committee.

vigil mechanism

The Company has established a vigil mechanism and overseas through the committee the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company

has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of co employees and the Company.

(B) SHAREHOLDERS RELATIONSHIP COMMITTEE

The Shareholders / Investors Grievances Committee have been reconstituted as Shareholders Relationship Committee in line with Section 178 (5) of the Companies Act, 2013 and are headed by Mr M Loganathan, Non-Executive Director.

The Committee monitors redressal of complaints received from shareholders/investors with respect to transfer of shares, non-receipt of dividend, non-receipt of Annual Report etc. The Committee also take note on number of transfers processed, issue of fresh share certificates, dematerialization of share certificates, report about top shareholders, share holding pattern etc.

There were no complaints received for this financial year. No instrument of transfers was pending on 31st March, 2015. All the communication received from shareholders was satisfactorily complied with, within the stipulated time.

During the year the Committee was met 6 times.

S Aravinthan, Company Secretary is the Compliance Officer.

The Company has appointed M/s. SKDC Consultants Limited, Coimbatore as Share Transfer Agent. Transfer/transmissions, issue of duplicate certificates etc as well as requests for de-materialization are approved/ confirmed, as the case may be, within the prescribed period through the above Share Transfer Agent. No valid transfer request remained pending for transfer to the transferees as on 31.03.2015.

(C) NOMINATION AND REMUNERATION COMMITTEE

The Company has a Remuneration Committee consists of Mr R Alagar, Independent Director, Mr M Loganathan, Independent Director and Mr A V Palaniswamy, Non-Independent Director as members. Functions of the remuneration committee are

1) Level and composition of remuneration which is reasonable and attractive to retain and motivate quality directors

2) Monitoring the performance and remuneration of the directors, key managerial personnel and other employees of the Company.

The Remuneration of Whole Time Director is determined by the Remuneration Committee consists of only Non-Executive Directors. The recommendation of the remuneration committee are considered and approved by the Board subject to the approval of the Shareholders.

The company has not paid any remuneration to any of its Non Executive Directors, except the Sitting Fees for attending the meetings of the Board of Directors and Audit Committee

corporate governance

By Virtue of the Circular CIR/CFD/Policy Cell/7/2014 Dated 15.9.2014 issued by Securities Exchange Board of India, for companies having Equity Share Capital not exceeding Rs.10 Crores and Net Worth not exceeding Rs.25 Crore the submission of Corporate Governance Report as stipulated in clause 49 of the Listing Agreement is not mandatory.

Since the Paid Up Equity Capital of the Company is only Rs. 8.32 Crores and Net Worth is Rs.18.20 Crore, the company is not required to submit Corporate Governance along with Directors' Report.

However your Board of Directors assure the members that the Company continues to maintain highest Standards of Integrity, transparency in operations, excellence in service to all share holders and strong Corporate Governance Standards.

The Board of Directors assure that the Corporate Governance Standards as stipulated in the Companies Act, 2013 have been fully complied with.

conservation of energy

a) On the assumption that power cut will be lifted and that power interruptions will be substantially reduced, the company is proposing to replace the existing power intensive, less efficient machines with newer CNC machines.

b) Continuous melting operation will reduce the existing power consumption per ton of metal considerably.

c) The molding operation will be continuous and this will reduce power consumption per ton of castings.

technology absorption

Technology to produce the items has been developed by the company indigenously. Company has developed new designs for the products to reduce the cost and will introduce these products after obtaining approvals from various international testing agencies.

foreign exchange earnings and outgo

Foreign exchange inflow (actual) : Rs. 38,97,42,889/-

Foreign exchange used (actual) : Rs. 98,76,456/-

industrial relations

Relationship with the employees/labour was cordial during the year under review.

acknowledgement

Your Directors take this opportunity to thank M/s. Bank of India for the support extended during the period. Your Directors also wish to thank all the suppliers, employees, Government Departments/ Agencies and others for their valuable contribution and assistance during the year.

FOR AND ON BEHALF OF THE BOARD

Place : Coimbatore Sd/- A.V. PALANISWAMY Sd/- M. LOGANATHAN Date : 29.05.2015 DIN No. 01817391 DIN No. 01936839 Managing Director Director

---

Mar 31, 2014

Dear Members,

The Directors have pleasure in presenting the Twenty First Annual Report together with the Audited Balance Sheet and Profit and Loss Statement for the year ended 31.03.2014.

FINANCIAL RESULTS :

The operating results for the year 2013-2014 are given below :

(in Lakhs)

Profit before Interest and Depreciation and Other adjustments 694.25

Less : Interest 63.59

Depreciation 71.90 135.49

Net Profit before Tax 558.76

Provision for Tax :

Current Tax 117.92

Deferred Tax Assets / Liability 44.94 222.86

Net Profit after Tax 335.90

Amount brought forward from previous year (84.60)

Amount available for appropriation 251.30

Appropriations

General Reserve 100.00

Dividend on Preference Shares 45.00

Dividend on Equity Shares 83.20

Dividend Distribution Tax 21.79

Surplus carried over to Balance Sheet 1.31

FINANCIAL PERFORMANCE:

The Company''s gross income for the financial year ended 31st March, 2014 was Rs.3732.49 lacs compared to Rs.3169.12 lacs in the previous year. The profit before tax for the Company is Rs. 558.76 lacs as against Rs.335.84 lacs in the previous year. The depreciation for the year is Rs.71.90 lacs compared to Rs.70.13 lacs in the previous year.

After providing Taxation, the Company''s net profit stands at Rs.335.90 lacs against Rs.132.53lacs in the previous year.

Your company proposes to transfer Rs. 100 lacs to General Reserve out of the amount available for appropriation and an amount of Rs.1.31 lacs is to be carried over to Balance Sheet after appropriation of Dividend on Preference Shares and Equity Shares including dividend tax.

The Net worth of the company is at Rs.1753 lacs as on 31.03.2014 as against Rs.1417 lacs in the previous year.

DIVIDEND:

The Board of Directors has recommended a dividend of Rs 9/- per Preference Share on 500000 9% Non-Convertible Non-Cumulative Redeemable Preference shares of Rs 100/- each aggregating to Rs 45 lacs excluding dividend tax for the financial year ended 31st March, 2014.

The Board of Directors has recommended a dividend of Re 1/- per Equity share on 8320000 equity shares Rs 10/- each aggregating to Rs 83.20 lacs excluding dividend tax for the financial year ended 31st March, 2014, which if approved in the ensuing Annual General Meeting will be paid to all the equity shareholders, whose names appear in the Register of Members as on 14th August, 2014.

REDEMPTION OF 9% NON-CONVERTIBLE NON-CUMULATIVE REDEEMABLE PREFERENCE SHARES

The company has considered the option of redeeming 2,00,000 preference shares out of the 5,00,000 9% Redeemable Non-Convertible Non-Cumulative Preference shares of Rs.100/- each which was approved by Board at their meeting on 30.05.2014.

PERFORMANCE:

Improved production and purchase of components from outside sources results in improved sales and the favorable foreign exchange helped to improve the margins substantially.

Power cut of nearly 70% of the normal requirement still exists in Tamil Nadu. Cost addition due to Diesel Generator power has been minimal and the increased production and sale has reduced the overhead costs.

During the year, the company made a net profit of Rs.335.90 lacs and by virtue of this, the net worth of the company has improved. With the business of the company continuing to improve, the company hopes to generate adequate surplus to evaluate the possibilities of adding additional capacities.

NAME OF THE COMPANY:

The name of the company has been changed from Interfit Techno Products Limited to National Fittings Limited with effect from 27.09.2013 after obtaining approval from Registrar of Companies, Tamil Nadu, Coimbatore.

DIRECTORS:

Mr K Arunachallam, Director resigned from Directorship - w.e.f 30.05.2013.

Mr M.Loganathan, Director, who retires by rotation, and being eligible, offers himself for reappointment for a term of five years.

Mr R Alagar, Director, who retires by rotation, and being eligible, offers himself for reappointment for a term of five years.

Mr A V Palaniswamy was appointed as the Managing Director at the Board Meeting on 13th February, 2014 for a period of five years with effect from 01.01.2014. Mr A V Palaniswamy is highly qualified engineer with more than 40 years of experience in manufacturing technologies and marketing. He was one of the promoters of the company.

COMPANY SECRETARY:

Mr. S. Aravinthan, ACS, is the Company Secretary and Compliance officer of the Company.

DIRECTORS'' RESPONSIBILITY STATEMENT :

Your Directors further report that

(i) in the preparation of annual accounts, the applicable accounting standards have been followed and there were no material departures;

(ii) the accounting policies selected by them have been applied consistently, prudent Judgments and estimates have been made to give a true and fair view of the state of affairs of the company as at 31st March 2014 and of the Profit of the company and the cash flow statement for the year ended 31.03.2014.

(iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(iv) the annual accounts have been prepared on a going concern basis.

(v) there is an adequate and efficient system of internal financial controls.

(vi) there is adequate system for the compliance with the provisions of applicable laws.

LISTING OF SHARES IN EXCHANGES AND DELISTING: :

The shares are listed in Bombay Stock Exchange and will be continued to be listed in Bombay Stock Exchange which has extensive networking and the investors have access to on-line dealings with the company''s securities across the country. The company''s shares have not been traded in Madras Stock Exchange for the past few years.

Members'' approval has already been obtained for De-listing the Company''s equity shares from Madras stock Exchange. Company will continue to meet the listing norms in these exchanges till such time the delisting approval is obtained.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

TRENDS AND DEVELOPMENT :

The economic slow down of Middle East where most of the products are sold has not reduced the demand for the products. Improvement in the building sector in areas other than Dubai in Middle East and the appreciation of dollar will continue to improve sales and margins during the year 2013-14. Company has started active domestic marketing arrangements and has started supplies to Delhi Airport expansion, Delhi Metro Rail system, Essar Steel pellatisation plant, Bombay Airport expansion, Bangalore Metro Project and other important projects.

AUDITORS:

M/s. Krishaan & Co., Chartered Accountants, Chennai, Statutory Auditors of the Company, will retire at the ensuing Annual General Meeting and are eligible for re-appointment.

DEPOSITS:

The Company has not accepted any deposits from the public.

CONSERVATION OF ENERGY :

a) No effective step was taken to reduce power consumption per ton due to 20% power cut, non-availability of power for 4 hours per day and frequent unscheduled power cuts during the day. Frequent stopping and restarting of melting equipments and other continuous process operations like wax preparation, shell coating under controlled air conditioned temperature resulted in higher usage of power than normal. Power situation may continue for next 12-18 months.

b) Power and fuel consumption;

i) The Company has consumed 12,20,700 Units of power during the year 31.03.2014.

ii) Consumption per Unit of Production :

6480 Units consumed per MT of Rough Castings as against 5804 units in the last year required for Stainless Steel & SG Iron Pipe Fittings and Ball Valves.

253 Units consumed per MT of Finished Goods as against 298 units in the last year required for Stainless Steel & SG Iron Pipe Fittings.

TECHNOLOGY ABSORPTION :

The Company has not entered into any Technical Collaboration agreement and hence furnishing of particulars regarding technology absorption does not arise.

FOREIGN EXCHANGE INFLOW AND OUTGO:

Foreign exchange inflow : Rs. 27,49,86,911/-

Foreign exchange used : Rs. 88,36,580/-

PARTICULARS OF EMPLOYEES :

During the period under review, there was no employee drawing remuneration in excess of the limits prescribed under section 178 of the Companies Act, 2013.

INDUSTRIAL RELATIONS :

Relationship with the employees / labour was cordial during the year under review.

ACKNOWLEDGEMENT:

Your Directors take this opportunity to thank M/s. Bank of India for the support extended during the period. Your Directors also wish to thank all the suppliers, employees, Government Departments/Agencies and others for their valuable contribution and assistance during the year.

FOR AND ON BEHALF OF THE BOARD

Place : Coimbatore Sd/- A.V. PALANISWAMY Sd/- M. LOGANATHAN Date : 30.05.2014 DIN No. 01817391 DIN No. 01936839 Managing Director Director

---

Mar 31, 2013

The Directors have pleasure in presenting the Twentieth Annual Report together with the Audited Balance Sheet and Profit and Loss Statement for the year ended 31.03.2013.

FINANCIAL RESULTS :

The operating results for the year 2012-2013 are given below : (Rs. in Lakhs)

Profit before Interest and Depreciation and Other adjustments 470.60

Less: Interest 64.65

Depreciation 70.13 134.76

Net Profit before Tax 335.84

Provision for Tax :

Current Tax 67.84

Deferred Tax Assets / (Liability) 176.85

244.69

91.15

Add:

MAT Credit Entitlement 41.42

Surplus carried over to Balance Sheet 132.57

FINANCIAL PERFORMANCE:

The Company''s gross income for the financial year ended 31st March, 2013 was Rs 3169.12 lacs compared to Rs.2910.17 lacs in the previous year. The Profit before tax for the company is Rs.335.84 lacs as against Rs 229.61 lacs in the previous year. The depreciation for the year is Rs.70.13 lacs compared to Rs. 42.98 lacs in the previous year.

After providing for Taxation, the Company''s net profit stands at Rs.132.53 lacs as against Rs.232.12 lacs in the previous year.

The net worth of the company is at Rs.1417 lacs as on 31.03.2013 as against Rs 1285.62 lacs in the previous year.

PERFORMANCE:

In spite of the 70% power cut in Tamil Nadu, Company managed to improve the sales and profits due to the favorable value of Indian Currency with respect to US Dollars.

The input costs decreased due to lower raw material prices and better utilization of man power in production.

The Company hopes to improve sales and profits due to improving power situation and continued reduction in raw material prices.

DIRECTORS:

Mr A V Palaniswamy, Director, who retires by rotation, and being eligible, offers himself for reappointment.

Mr R Alagar, Director, who retires by rotation, and being eligible, offers himself for reappointment.

Mr. Philip K Baby, Director resigned from Directorship - w.e.f 13.08.2012.

COMPANY SECRETARY:

Mr. S. Aravinthan, ACS, was the Company Secretary and Compliance officer of the Company.

DIRECTORS'' RESPONSIBILITY STATEMENT :

Your Directors further report that

(i) in the preparation of annual accounts, the applicable accounting standards have been followed and there were no material departures;

(ii) the accounting policies selected by them have been applied consistently, prudent Judgments and estimates have been made to give a true and fair view of the state of affairs of the company as at 31st March 2013 and of the Profit of the company and the cash flow statement for the year ended 31.03.2013.

(iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(iv) The annual accounts have been prepared on a going concern basis.

LISTING OF SHARES IN EXCHANGES AND DELISTING: :

The shares are listed in Bombay Stock Exchange and will be continued to be listed in Bombay Stock Exchange which has extensive networking and the investors have access to on-line dealings with the company''s securities across the country.

The company''s shares have not been traded in Madras Stock Exchange for the past few years. Members'' approval has already been obtained for De-listing the Company''s equity shares from Madras stock Exchange. Company will continue to meet the listing norms in the exchange till such time the delisting approval is obtained.

The Coimbatore Stock Exchange Limited (CSX) has ceased to be a recognized Stock Exchange with effect from 03rd April, 2013 and hence the Company is not required to comply with the terms and conditions of the listing agreements with Coimbatore Stock Exchange Limited any more.

AUDITORS:

M/s. Krishaan & Co., Chartered Accountants, Chennai, Statutory Auditors of the Company, will retire at the ensuing Annual General Meeting and are eligible for re-appointment.

DEPOSITS:

The Company has not accepted any deposits from the public.

CONSERVATION OF ENERGY :

a) Due to continued power cut and interruption no effective steps could be taken to reduce power consumption. As and when the power cut is relaxed or removed and interruptions are reduced, Company will take necessary steps to conserve energy in melting, molding and finishing operations.

b) Power and fuel consumption;

i) The Company has consumed 10,37,086 Units of power during the year 31.03.2013.

ii) Consumption per Unit of Production :

5804 Units consumed per MT of Rough Castings as against 6825 units in the last year required for Stainless Steel Pipe Fittings & Ball Valves.

298 Units consumed per MT of Finished Goods as against 227 units in the last year required for Stainless Steel Pipe Fittings & SG Iron Pipe Fittings.

TECHNOLOGY ABSORPTION :

The Company has not entered into any Technical Collaboration agreement and hence furnishing of particulars regarding technology absorption does not arise.

FOREIGN EXCHANGE INFLOW AND OUTGO:

Foreign exchange inflow Rs. 23,49,95,649/-

Foreign exchange used Rs. 1,48,24,511/-

PARTICULARS OF EMPLOYEES :

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

INDUSTRIAL RELATIONS :

Relationship with the employees / labour was cordial during the year under review.

ACKNOWLEDGEMENT :

Your Directors take this opportunity to thank M/s. Bank of India for the support extended during the period. Your Directors also wish to thank all the suppliers, employees, Government Departments/Agencies and others for their valuable contribution and assistance during the year.

FOR AND ON BEHALF OF THE BOARD

Place : Coimbatore Sd/-

A.V. PALANISWAMY

Sd/-

M. LOGANATHAN

Date : 30.05.2013 Managing Director Director

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Mar 31, 2012

The Directors have pleasure in presenting the Nineteenth Annual Report together with the Audited Balance Sheet and Profit and Loss Statement for the year ended 31.03.2012.

FINANCIAL RESULTS :

The operating results for the year 2011-2012 are given below : -

(Rs in Lakhs)

Profit before Interest and Depreciation and Other adjustments 337.27

Less : Interest 64.68

Depreciation 42.98 107.66

Net Profit before Tax 229.61

Provision for Tax :

Current Tax 46.04

Deferred Tax (Assets) / Liability (3.84)

42.20

187.41

Add:

MAT Credit Entitlement 44.71

Surplus carried over to Balance Sheet 232.12

PERFORMANCE:

Steps taken to manufacture and market new product lines complimentary to existing product has improved the sales and margins substantially, Manufacturing capacity was better utilised for newer product lines with Diesel generated power.

Power cut of nearly 70% of the normal requirement still exists in Tamil Nadu. Cost addition due to Diesel Generator power has been minimal in new product lines and the increased production and sale has reduced the overhead costs.

Company has been evaluating different methods to produce castings with minimum power requirement and will be implementing these methods during the current year.

During the year, the company made a net profit of ' 229 lacs and by virtue of this, the net worth of the company has become positive this year. With the business of the company continuing to improve, the company hopes to generate adequate surplus and wipe out the accumulated losses, in the next two years.

DIRECTORS:

Mr. Loganathan, Director, who retires by rotation, and being eligible, offers himself for reappointment. Mr. Philip K Baby, Director resigned from Director - Marketing w.e.f 01.12.2011.

COMPANY SECRETARY:

Mr. S. Aravinthan, ACS, was the Company Secretary and Compliance officer of the Company.

DIRECTORS' RESPONSIBILITY STATEMENT :

Your Directors further report that

(i) in the preparation of annual accounts, the applicable accounting standards have been followed and there were no material departures;

(ii) the accounting policies selected by them have been applied consistently. Prudent Judgments and estimates have been made to give a true and fair view of the state of affairs of the company as at 31st March 2012 and of the Profit of the company and the cash flow statement for the year ended 31.03.2012.

(iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(iv) The annual accounts have been prepared on a going concern basis.

DELISTING :

The shares are listed in Bombay Stock Exchange and will be continued to be listed in Bombay Stock Exchange which has extensive networking and the investors have access to on-line dealings with the company's securities across the country. The company's shares have not been traded in Coimbatore and Madras Stock Exchange for the past few years.

Members' approval has already been obtained for De-listing the Company's equity shares from Coimbatore and Madras stock Exchanges. Company will continue to meet the listing norms in these exchanges till such time the delisting approval is obtained.

INVESTOR EDUCATION AND PROTECTION FUND

No amount is required to be transferred to Investor Education and Protection Fund.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT TRENDS AND DEVELOPMENT :

The economic slow down of Middle East where most of the products are sold has not reduced the demand for the products. Improvement in the building sector in areas other than Dubai in Middle East and the appreciation of dollar will continue to improve sales and margins during the year 2011-12. Company has started active domestic marketing arrangements and has started supplies to several major projects like Bombay Airport, Indian Oil Corporation Paradeep port refinery through Essar, building sector in Pune etc.

AUDITORS:

M/s. Krishaan & Co., Chartered Accountants, Chennai, Statutory Auditors of the Company, will retire at the ensuing Annual General Meeting and are eligible for re-appointment.

DEPOSITS :

The Company has not accepted any deposits from the public.

CONSERVATION OF ENERGY :

a) No effective step was taken to reduce power consumption per ton due to 40% power cut, non- availability of power for 8 hours per day and limitation of power during 18 hours to 22 hours every day. Frequent stopping and restarting of melting equipments and other continuous process operations like wax preparation, shell coating under controlled air conditioned temperature resulted in higher usage of power than normal. Power situation may continue for next 12-18 months.

b) Power and fuel consumption;

i) The Company has consumed 10,81,662 Units of power during the year 31.03.2012.

ii) Consumption per Unit of Production :

6825 Units consumed per MT of Rough Castings as against 5962 units in the last year required for Stainless Steel Pipe Fittings and Ball Valves.

227 Units consumed per MT of Finished Goods as against 223 units in the last year required for Stainless Steel Pipe Fittings and SG Iron Pipe Fittings.

TECHNOLOGY ABSORPTION :

The Company has not entered into any Technical Collaboration agreement and hence furnishing of particulars regarding technology absorption does not arise.

FOREIGN EXCHANGE INFLOW AND OUTGO:

Foreign exchange inflow : ' 20,98,83,223/- Foreign exchange used : ' 1,72,40,399/-

PARTICULARS OF EMPLOYEES :

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

INDUSTRIAL RELATIONS :

Relationship with the employees / labour was cordial during the year under review.

ACKNOWLEDGEMENT :

Your Directors take this opportunity to thank M/s. Bank of India for the support extended during the period. Your Directors also wish to thank all the suppliers, employees, Government Departments/Agencies and others for their valuable contribution and assistance during the year.

FOR AND ON BEHALF OF THE BOARD

Place : Coimbatore SD/- A.V. PALANISWAMY SD/- M. LOGANATHAN

Date : 26.05.2012 Managing Director Director

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Mar 31, 2010

The Directors have pleasure in presenting the Seventeenth Annual Report together with the Audited Balance Sheet & Profit and Loss Account for the year ended 31.03.2010.

FINANCIAL RESULTS :

The operating results for the year 2009-2010 are given below :

(Rs. in Lakhs)

Profit before Interest and Depreciation

& Other adjustments 364.06

Less: Interest 59.45

Depreciation 20.34

Preliminary & Product Development Expenses written off

& Other Adjustments 5.30 85.09

Net Profit before Tax 278,97

Provision for Tax

Current Tax : Nil

Deferred Tax (Assets) / Liability (4.30)

(4.30)

Net Profit 283.27

PERFORMANCE:

Steps taken to manufacture and market new product lines complimentary to existing product has improved the sales and margins substantially, Manufacturing capacity was better utilised for newer product lines with Diesel generated power.

Power cut of nearly 70% of the normal requirement still exists in Tamil Nadu. Cost addition due to Diesel Generator power has been minimal in new product lines and the increased production and sale has reduced the overhead costs.

During the year, the company made a net profit of Rs.278 lacs and by virtue of this, the net worth of the company has become positive this year. With the business of the company continuing to improve, the company hopes to generate adequate surplus and wipe out the accumulated losses, in the next two years.

DIRECTORS:

Mr A.V. Palaniswamy, Director, who retires by rotation, and being eligible, offers himself for reappointment.

Mr M. Loganathan, Director, who retires by rotation, and being eligible, offers himself for reappointment.

Mr. Philip K Baby was appointed as Director - Marketing. Mr Philip K Baby is highly qualified engineer with more than 20 years of experience in marketing.

COMPANY SECRETARY:

Mr. S. Aravinthan, ACS, was the Company Secretary and Compliance officer of the Company.

DIRECTORS RESPONSIBILITY STATEMENT :

Your Directors further report that

(i) in the preparation of annual accounts, the applicable accounting standards have been followed and there were no material departures;

(ii) the accounting policies selected by them have been applied consistently, Prudent Judgments and estimates have been made to give a true and fair view of the state of affairs of the company as at 31st March 2010 and of the Profit of the company and the cash flow statement for the year ended 31.03.2010.

(iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(iv) The annual accounts have been prepared on a going concern basis.

DELISTING :

The shares are listed in Bombay Stock Exchange and will be continued to be listed in Bombay Stock Exchange which has extensive networking and the investors have access to on-line dealings with the companys securities across the country. The companys shares have not been traded in Coimbatore and Madras Stock Exchange for the past few years.

Members approval has already been obtained for De-listing the Companys equity shares from Coimbatore and Madras stock Exchanges. Company will continue to meet the Listing norms in these Exchanges till such time the delisting approval is obtained.

FOR AND ON BEHALF OF THE BOARD Place : Coimbatore Sd/- A.V. PALANISWAMY Sd/- M. LOGANATHAN Date : 29.05.2010 Managing Director Director