Directors Report of Visaka Industries Ltd.

Mar 31, 2025

Your directors are pleased to present the 43^rd Annual Report on the operational and business performance of the Company together with the Audited Financial Statements (Standalone and Consolidated) for the Financial Year ended March 31, 2025.

Financial Performance

The summarized financial performances for the Financial Year ended March 31, 2025, are as under:

(H in Lakhs)
Particulars	Standalone		Consolidated
	2024-25	2023-24	2024-25	2023-24
Total Revenues	1,54,887	1,53,136	1,55,144	1,53,735
Profit before depreciation and taxes	6,480	6,245	6,262	6,194
Profit before taxes	132	449	(200)	299
Provision for taxes (including deferred tax)	118	196	101	213
Total comprehensive income	(60)	5	(376)	(163)
Dividend	432	1,728	432	1,728
Balance brought forward from previous year	38,697	40,420	38,389	40,279
Profit available for appropriation	38,205	38,697	37,581	38,389

Performance review and the state of Company’s affairs

The company’s consolidated total income for the year 2024-25 is H1551 Crores increased by 0.92% over the previous financial year and the standalone total income for the year 2024-25 is H1549 Crores increased by 1.14% over the previous financial year

The Company has achieved slightly higher revenue during the financial year under review inspite of slowdown in both the building sector and in textile business. The general slowdown in the economy and cashflow issues across the market impacted the growth in revenue. The company’s profitability was impacted mainly due to challenges face by the textile division despite of improvement in cement roofing business. The textile division has not performed well due to lower realisation and severe competition from cheaper yarn both from China as well as domestic players converting double yarn from single yarn with lesser costs. The cement roofing business performance improved as there is reduction in raw material costs during the year even though the lower volumes and pricing impacted the profit margins in the business. The boards & panels business contributed with similar margins like previous year. The higher interest rates due to inflation across the globe and higher depreciation on the new

units which are setup during past two years also impacted the profitability during the year.

The Company made standalone profit after tax of H0.14 Crores during the current financial year compared to H2.53 Crores in the previous financial year. The company is expecting to have a significant growth in the coming years as it has foreseen good economic indicators with good monsoon in the coming year. The company has aggressively expanded during the last three years by setting up one cement roofing unit and two fibre cement board units along with one Panel unit to take advantage of growing demand in sector and economies in logistic and operational costs.

The Company’s other key performance indicators are as under:

Cash Profit during the year was H64 Crores as compared to H61 Crores in the previous year.

The capital expenditure for FY 2024-25 was H28 Crore towards regular normal additions.

Capital

During the financial year under review there is no change in the capital structure of the Company.

Dividend

Pursuant to the provisions of the Companies Act, 2013 (“the Act”) and rules made thereunder, applicable provisions of SEBI LODR Regulations and based on the parameters enunciated in the Dividend Distribution Policy adopted by the company, the Board of Directors of the Company, in its meeting held on May 21, 2025, recommended a Final Dividend of H0.50 /- (Fifty Paise only) (i.e 25%) per Equity Share of H2/- each fully paid-up for your approval for the Financial Year 2024-25.

The Final dividend, if approved at the 43^rd Annual General Meeting (AGM), will be paid to all eligible members within thirty days from the conclusion of the ensuing Annual General Meeting of members of the Company.

Transfer to Reserves

For the financial year ended March 31, 2025, the company has not proposed to transfer any amount to the general reserve.

Consolidated Financial Statements

The consolidated financial statements of your company for the financial year 2024-25, are prepared in compliance with applicable provisions of the Act, Indian Accounting Standards and the SEBI Listing Regulations. The consolidated financial statements have been prepared on the basis of audited financial statements of the company and its subsidiaries, as approved by their respective Board of Directors.

Subsidiary Companies

The Company has two subsidiaries, Visaka Green Private Limited (previously Vnext Solutions Private Limited) and Atum Life Private Limited as on March 31, 2025.

Visaka Green Private Limited has been setup to capitalise on the expertise gained in the various applications of its products. viz., EPC contracts, Turnkey solutions, construction of Infil houses with Atum Solar panels, V-Boards, V-Panels and Infil material.

Atum Life Private Limited has been formed to deal with the sustainable and eco-friendly products. The Company had set up sustainable studios to deal with various range of sustainable products including holding company’s sustainable products.

The Statement containing salient features of the financials of Subsidiaries / associate companies / joint ventures (Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014) in form AOC-1 is annexed as Annexure-1.

In terms of Section 129(3) of the Companies Act, 2013, the consolidated financial statements of the company and all its subsidiaries prepared in accordance with Ind AS 110 and 111 as specified in the Companies (Indian Accounting Standards) Rules, 2015, forming part of the annual report. In accordance with

Section 136 of the Companies Act, 2013, the audited financial statements and related information of the subsidiaries, wherever applicable, are available on the company’s website: https://visaka. co/investors/financial_information/fn_subcomfin These are also available for inspection during regular business hours at our Registered office in Secunderabad, India.

Management Discussion and Analysis Global economic review

Overview: Global economic growth declined marginally from 3.3% in 2023 to an estimated 3.2% in 2024. This was marked by a slowdown in global manufacturing, particularly in Europe and parts of Asia coupled with supply chain disruption and weak consumer sentiment. In contrast, the services sector performed more creditably.

The growth in advanced economies remained steady at 1.7% from 2023 to 2024 as the emerging cum developing economies witnessed a growth decline at 4.2% in 2024 (4.4% in 2023).

On the positive side, global inflation was expected to decline from 6.1% in 2023 to 4.5% in 2024 (projected at 3.5% and 3.2% in 2025 and 2026 respectively). This decline was attributed to the declining impact of erstwhile economic shocks, and labour supply improvements. The monetary policies announced by governments the world over helped keep inflation in check as well.

The end of the calendar year was marked by the return of Donald Trump as the new US President. The new US government threatened to impose tariffs on countries exporting to the US unless those countries lowered tariffs for the US to export to their countries. This enhanced global trade and markets uncertainty and emerged as the largest singular uncertainty in 2025.

Regional growth (%)	2025	2024
World output	3.2	3.3
Advanced economies	1.7	1.7
Emerging and developing economies	4.2	4.4
(Source: IMF, KPMG, Press Information Bureau, BBC, India Today)

Performance of the major economies, 2024

United States: Reported GDP growth of 2.8% in 2024 compared to 2.9% in 2023.

China: GDP growth was 5.0% in 2024 compared to 5.2% in 2023.

United Kingdom: GDP growth was 0.8% in 2024 compared to 0.4% in 2023.

Japan: GDP growth was 0.1% in 2024 compared with 1.9% in 2023.

Germany: GDP contracted by 0.2% in 2024 compared to a 0.3% decline in 2023.

(Source: CNBC, China Briefing, ons.gov.uk, Trading Economics, Reuters)

Outlook: The global economy has entered a period of uncertainty following the imposition of tariffs of products imported into the USA and some countries announcing reciprocal tariffs on US exports to their countries. This is likely to stagger global economic growth, the full outcome of which cannot be currently estimated. This risk is supplemented by risks related to conflicts, geopolitical tensions, trade restrictions and climate risks. In view of this, World Bank projected global economic growth at 2.7 per cent for 2025 and 2026, factoring the various economic uncertainties. (Source: IMF, United Nations)

Indian economic review Overview

The Indian economy was projected to grow at 6.5% in FY 2024-25, compared to a revised 9.2% in FY 2023-24. This represented a four-year low due to a moderate slowdown within the Indian economy (marked by slower manufacturing growth and a decline in net investments). Despite the slowdown, India retained its position as the world’s fourth-largest economy.

India’s nominal GDP (at current prices) was H331 trillion in FY 2024-25 (H301.23 trillion in FY 2023-24). The nominal GDP per capita increased from H2,15,936 in FY 2023-24 to H2,35,108 in FY 2024-25, reflecting the impact of an economic expansion.

The Indian rupee weakened 2.12% against the US dollar in FY 2024-25, closing at H85.47 on the last trading day of FY25. In March 2025, the rupee recorded the highest monthly appreciation since November 2018, rising 2.39% (arising out a weakening US dollar).

Inflationary pressures eased, with CPI inflation averaging 4.63% in FY 2024-25, driven by moderating food inflation and stable global commodity prices. Retail inflation at 4.6% in FY 2024-25, was the lowest since the pandemic, catalysing savings creation.

India’s foreign exchange reserves stood at a high of $676 billion as of April 4, 2025. This was the fourth consecutive year when rating upgrades outpaced downgrades on account of strong domestic growth, rural consumption, increased infrastructure investments and low corporate leverage (annualized rating upgrade rate 14.5% exceeded the decade-long average of 11%; downgrade rate was 5.3%, lower than the 10-year average of 6.5%).

Gross foreign direct investment (FDI) into India rose 13.6% to $81 billion during the last financial year, the fastest pace of expansion since 2019-20. The increase in the year was despite a contraction during the fourth quarter of 2024-25 when inflows on a gross basis declined 24.5% to $9.34 billion due to the uncertainty caused by Donald Trump’s election and his assertions around getting investments back into the US.

Growth of the Indian economy
	FY22	FY23	FY24	FY25
Real GDP growth (%)	8.7	7.2	9.2	6.5
(Source: MoSPI, Financial Express, New Indian Express, Times of India)
Growth of the Indian economy quarter by quarter, FY 2024-25
	Q1	Q2	Q3	Q4
	FY25	FY25	FY25	FY25
Real GDP growth (%)	6.5	5.6	6.2	7.4
(Source: The Hindu, National Statistics Office)

The banking sector continued its improvement, with gross nonperforming assets (NPA) for scheduled commercial banks (SCBs) declining to 2.6% as of September 2024, down from 2.7% in March 2024. The capital-to-risk-weighted assets ratio for SCBs stood at 16.7% as of September 2024, reflecting a strong capital position.

India’s exports of goods and services are projected to reach $800 billion in FY 2024-25, up from $778 billion in the previous fiscal year. The Red Sea crisis impacted shipping costs, affecting price-sensitive exports. Merchandise exports were expected to grow 2.2% YoY, reaching $446.5 billion.

India’s net GST collections increased 8.6%, totalling H19.56 lakh Crore in FY 2024-25. Gross GST collections in FY 2024-25 stood at H22.08 lakh Crore, a 9.4% increase YoY.

On the supply side, real gross value added (GVA) was estimated to expand 6.4% in FY 2024-25. The industrial sector was expected to grow 6.2%, supported by growth in construction activities, electricity gas, water supply and other utility services.

India’s services sector grew an estimated 7.3% in FY 25 (9.0% in FY 24), driven by public administration, defence and other services (expanded at 8.8% as in the previous year). In the infrastructure and utilities sector, electricity gas, water supply and other utility services grew a projected 6.0% in FY 25, compared to 8.6% in FY 24. Meanwhile, the construction sector expanded at ~8.6% in FY 25, slowing from 10.4% in the previous year.

Manufacturing activity was subdued in FY 25, with growth projected at 4.3%, which was lower than 12.3% in FY 24. Moreover, due to lower public spending in the early part of the year, government final consumption expenditure (GFCE) is anticipated to have slowed to 3.8% in FY 25, compared to 8.1% in FY24.

The agriculture sector growth was estimated at 3.8% in 2024-25 (1.4% in 2023-24). Trade, hotel, transport, communication and

services related to broadcasting segment were estimated to grow at 6.4% in 2024- 25 (6.3% in 2023-24).

From a demand perspective, private final consumption expenditure at constant prices was forecast to grow 7.3%, indicating a rebound in rural demand and stronger consumer confidence.

The Nifty 50 and SENSEX recorded their weakest annual performances in FY 25 in two years, rising 5.3% and 75% during the year under review respectively. Gold rose 37.7% to a peak of $3,070 per ounce, the highest increase since FY 2007-08, indicating global uncertainties.

Total assets managed by the mutual fund (MF) industry jumped 23% or H12.3 lakh Crore in fiscal 2025 to settle at H65.7 lakh Crore. At close of FY 25, the total number of folios had jumped to nearly H23.5 Crore, an all-time peak. During last fiscal, average monthly systematic investment plan (SIP) contribution jumped 45% to H24113 Crore.

Foreign portfolio investments (FPIs) in India experienced high volatility throughout 2024, with total inflows into capital markets reaching approximately $20 billion by year-end. However, there was significant selling pressure in the last quarter, influenced by new tariffs announced by the new US government on most countries (including India).

Outlook

India is expected to remain the fastest-growing major economy. Initial Reserve Bank of India estimates have forecast India’s GDP growth downwards from 6.7% to 6.5% based on risks arising from US tariff levies on India and other countries. The following are some key growth catalysts for India in FY26.

Tariff-based competitiveness: India identified at least 10 sectors such as apparel and clothing accessories, chemicals, plastics and rubber where the US’ high tariffs give New Delhi a competitive advantage in the American market over other suppliers. While India faced a 10% tariff after the US suspended the 26% additional duties for 90 days, the levy remained at 145% on China, the biggest exporter to the US. China’s share of apparel imports into the US was 25%, compared with India’s 3.8%, a large opportunity to address differential (Source: Niti Aayog).

Union Budget FY 2024-25: The Union Budget 2025-26 laid a strong foundation for India’s economic trajectory, emphasizing agriculture, MSMEs, investment, and exports as the four primary growth engines. With a fiscal deficit target of 4.4% of GDP, the government reinforced fiscal prudence while allocating H11.21 lakh Crore for capital expenditure (3.1% of GDP) to drive infrastructure development. The February 2025 Budget marked a shift in approach, with the government proposing substantial personal tax cuts. Effective from April 1, 2025, individuals earning up to H12 lakh annually will be fully exempt from income tax. Economists estimate that the resulting H1 lakh Crore in tax savings could boost

consumption by H3-3.5 lakh Crore, potentially increasing the nominal private final consumption Expenditure (PFCE) by 1.5-2% of its current H200 lakh Crore.

Pay Commission impact: The 8^th Pay Commission’s awards could lead to a significant salary revision for nearly ten million central government employees. Historically, such commissions have led to major hikes, with the 7^th Pay Commission in 2016 raising the minimum basic pay from H7,000 to H18,000 using a 2.57 fitment factor. The upcoming commission, approved and likely effective from January 1, 2026 (though possibly delayed), may apply a fitment factor of 2.5-2.86, increasing basic pay to H46,800-H51,480. A 40-50% overall salary hike is anticipated, and the Dearness Allowance may be merged with basic pay. These reforms aim to keep public sector compensation aligned with inflation and living standards.

Monsoons: The India Meteorological Department predicted an ''above normal’ monsoon in 2025. This augurs well for the country’s farm sector and a moderated food inflation outlook.

Easing inflation: India’s consumer price index-based retail inflation in March 2025 eased to 3.34 per cent, the lowest since August 2019, raising hopes of further repo rate cuts by the Reserve Bank of India.

Deeper rate cuts: In its February 2025 meeting, the Monetary Policy Committee (MPC) reduced policy rates by 25 basis points, reducing it to 6% in its first meeting of FY 2025-26. Besides, India’s CPI inflation is forecasted at 4% for the fiscal year 2025-26.

Lifting credit restrictions: In November 2023, the RBI increased risk weights on bank loans to retail borrowers and NBFCs, significantly tightening credit availability. This led to a sharp slowdown in retail credit growth from 20-30% to 9-13% between September 2023 and 2024. However, under its new leadership, the RBI has prioritized restoring credit flow. Recent policy shifts have removed restrictions on consumer credit, postponed higher liquidity requirements for banks, and are expected to rejuvenate retail lending.

(Source: CNBC, Press Information Bureau, Business Standard, Economic Times, World Gold Council, Indian Express, Ministry of External Affairs, Times of India, Business Today, Hindustan Times, Statistics Times)

Construction and building materials industry review

Construction materials include any substance used in building structures. Historically, natural materials such as clay, pebbles, sand, wood, twigs, and leaves were commonly employed. Today, a wide range of both naturally occurring and man-made, synthetic products are integral to construction. The production of building materials has evolved into a well-established global industry, supporting specialized trades such as carpentry, insulation,

plumbing, and roofing. These materials form the essential building blocks for homes, commercial spaces, and broader living environments.

The global construction materials market is expected to expand from USD 1.11 billion in 2024 to USD 1.72 billion by 2033, reflecting a compound annual growth rate of 4.9% during the estimated period from 2025 to 2033.

This growth is primarily driven by increasing demand across residential and commercial sectors. Manufacturers worldwide are capitalizing on this opportunity by boosting capital investments, intensifying research and development activities, and delivering higher-quality products. Rapid infrastructure development, particularly in emerging economies, serves as a significant catalyst for market expansion. However, challenges such as high production costs and limited awareness about eco-friendly materials in developing regions are impeding the market’s full growth potential.

Regionally, North America holds 28% of the global construction materials market, valued at USD 310.8 billion in 2024, with a forecasted CAGR of 3.8%, supported by increased infrastructure spending and advancements in sustainable building technologies. The Asia-Pacific region dominates with a 38% market share, valued at USD 421.8 billion in 2024, and is expected to grow at a robust CAGR of 5.8%, fuelled by rapid urbanization, major infrastructure projects, and government-backed housing initiatives, particularly in China and India. Europe accounts for 25% of the market, totalling USD 277.5 billion in 2024, with a projected CAGR of 4.2%, driven by a strong emphasis on eco-friendly construction practices and strict regulatory standards across nations such as Germany, France, and the United Kingdom. The Rest of the World commands approximately 9% of the market, amounting to USD 99.9 billion in 2024, driven by infrastructure investments in Africa and Latin America.

In India, the construction materials market was valued at USD 114.45 million in 2024 and is expected to reach USD 156.80 million by 2033, growing at a CAGR of 3.20% during 2025-2033. Rapid urbanization, infrastructure development, and rising real estate investments are the primary drivers of this growth. Demand for materials such as cement, steel, bricks, and advanced construction products is increasing, further supported by government initiatives, smart city projects, and a growing focus on sustainable and technologically advanced construction practices.

The India roofing market, valued at USD 8.08 billion in 2025 and projected to reach USD 11.07 billion by 2030 at a CAGR of 6.5%, is evolving rapidly in response to shifting climatic, structural, and aesthetic needs. Among the range of roofing solutions available, cement roofing products continue to hold a prominent position, especially in a cost-conscious and climate-diverse country like India. Fibre cement and concrete roofing sheets are particularly valued for their durability, fire and moisture resistance, and strong thermal insulation—making them an ideal choice for residential, commercial, and industrial applications alike. Their low

maintenance requirements and long service life provide an edge over many substitute materials, especially in regions exposed to high heat or rainfall.

While metal sheets and asphalt shingles remain options in certain urban or specialized segments, their cost, installation complexity, and long-term sustainability often fall short in comparison. Polycarbonate and bituminous materials serve niche purposes, but lack the robustness required for mainstream applications. Emerging green roofing systems, though environmentally promising, are still limited by cost and scalability.

The importance of reliable and resilient roofing became even more pronounced during the COVID-19 pandemic, which severely disrupted the construction ecosystem. Labour shortages, stalled projects, and financial stress exposed the need for easy-to-install, low-maintenance, and weather-resistant roofing—strengths inherent in cement-based products. As construction activity rebounds, demand is expected to tilt further toward cement roofing solutions, driven by their adaptability, performance, and value-for-money.

(Source: Business Research Insights, IMARC, Mordor Intelligance)

Outlook

The construction materials industry is poised for continued strong growth, driven by major infrastructure and housing projects, along with the increased adoption of technology and automation to enhance efficiency and logistics. Industry consolidation is accelerating, with larger companies acquiring smaller players to strengthen market positioning. There is a rising emphasis on sustainability, with growing demand for ecofriendly construction materials. However, challenges persist, including intense competition from unorganized players leading to price pressures and a lack of standardization. Volatile raw material prices and supply chain disruptions also pose risks to profitability. The industry faces a critical need for skilled labour to support installation, maintenance, and technical services. While government-backed projects are expected to drive demand and business growth, environmental concerns such as dust, noise, vibrations, and ecological disruptions from material extraction present significant hurdles. High logistics costs, stringent zoning laws, and restrictions on natural resource extraction are creating supply chain constraints, further complicating market expansion efforts.

(Source: Fortune Business Insights, Linked-In)

Growth drivers

Urbanization growth: India is undergoing rapid urbanization, with its urban population projected to reach 600 million (40% of the total population) by 2036, up from 31% in 2011. Urban areas are expected to contribute nearly 70% of the country’s GDP

Population expansion: With a population of 1.44 billion, India has surpassed China as the world’s most populous country. The

population is expected to grow sustainably, driving increased housing demand.

Demographic dividend: India’s median age of 28 years is notably lower than China’s 39 years and the US’ 38 years, positioning the country as a key driver of global consumption growth. This rise in consumption growth is further expected to translate into an increase in demand for houses and hence, in demand of construction and building materials sector.

Declining dependency ratio: India’s dependency ratio is projected to decline from 47% in 2023 to 31% by 2031, leading to higher disposable incomes and greater consumer spending.

Rising affluent Indians: The proportion of affluent consumers in India’s socio-economic classes A and B rose to over 45% and 30%, respectively, in 2024, while the middle class contracted to 40.1% of the population. This demographic shift towards greater affluence is expected to drive growth in the housing sector, benefiting the construction and building materials industry.

Rising incomes: India’s per capita income has grown at a CAGR of 8.7% since 2015, leading to increased discretionary spending. This upward income trend is expected to further boost housing demand across the country.

Preference for green buildings: Technological advancements and a rising focus on sustainability are transforming the construction industry. This shift towards eco-friendly buildings is driving demand for sustainable construction materials.

(Source: Economic Times, Worldometer, Frontline)

Government initiatives

Enhanced capital expenditure for infrastructure: The Union Budget 2024-25 allocated a record H11.11 lakh Crore for capital expenditure, marking an 11.1% increase from the previous year. This investment, constituting 3.4% of India’s GDP, is directed towards accelerating infrastructure projects, including roads, power plants, and public facilities, thereby driving demand in the construction sector.

Promotion of green and sustainable building materials: In

alignment with global sustainability goals, the government is incentivizing the production and use of green building materials. This includes support for manufacturers producing eco-friendly materials and initiatives to integrate sustainable practices in construction projects.

Development of industrial corridors and parks: The National Industrial Corridor Development Programme has sanctioned 12 new industrial parks aimed at enhancing industrial infrastructure. These parks are expected to boost economic activity and provide a structured environment for manufacturing and construction-related industries.

Affordable housing initiatives: Under the Pradhan Mantri Awas Yojana (PMAY), the government continues to focus on providing affordable housing. The PMAY-Urban 2.0 scheme has

been allocated H10 lakh Crore to support the construction of affordable homes in urban areas, thereby increasing demand for construction materials and services.

Support for stalled housing projects: The SWAMIH Fund 2(Special Window for Affordable and Mid-Income Housing Investment Fund), with an allocation of H15,000 Crore, aims to expedite the completion of stalled housing projects. This initiative is expected to bring relief to over one lakh homebuyers and revitalize the real estate sector.

Investment in skill development: Recognizing the need for a skilled workforce in the construction industry, the government plans to upgrade 1,000 Industrial Training Institutes (ITIs) over the next five years. This initiative aims to equip workers with the necessary skills to meet the evolving demands of the construction sector.

(Source: StrategicERP, Investindia.gov.in, Linked-in, Reuters, Biltrax Media, KPMG, Construction World,)

Fibre cement products market review

Fibre cement boards and sheets are versatile composite materials made primarily from cement, cellulose fibres (usually wood pulp), and additives like sand, silica, and water. Widely used across the construction industry, they serve multiple applications such as siding, roofing, flooring, ceilings, and partitions. Compared to traditional materials like wood and vinyl, fibre cement products offer enhanced benefits, including exceptional durability, fire and moisture resistance, and superior dimensional stability. They are also highly resistant to termites, rot, and weathering, making them ideal for both interior and exterior applications across India’s varied climatic conditions. India’s fibre cement market is prepared for significant expansion, with its valuation reaching USD 4.12 3illion in 2024 and is estimated to grow to 7.49 million at a CAGR of 6.87% through 2033.

The growth is driven by the superior advantages of fibre cement boards over traditional building materials, including greater durability, fire and moisture resistance, and resilience against termites and harsh weather conditions.

Several driving factors contribute to this positive market trajectory. Rapid urbanization and industrialization have spurred construction activity across residential, commercial, and infrastructure sectors. Rising environmental awareness and an increasing focus on green building initiatives are boosting demand for sustainable fibre cement products. Further supporting market expansion are technological advancements in product quality and government initiatives such as affordable housing and smart city projects, which are expected to drive widespread adoption of fibre cement boards and sheets.

High-density fibre cement boards dominate the market due to their superior strength and durability, making them suitable for various applications in both residential and commercial sectors. Regionally, North India leads the market, driven by significant

construction activities in states like Delhi, Uttar Pradesh, and Haryana.

(Source: Techsci Research)

Growth drivers

Rising preference for sustainable and eco-friendly construction: The growing emphasis on sustainability is a major growth driver for the fibre cement boards and sheets market in India. As environmental awareness rises among consumers, businesses, and government bodies, there is an increasing shift toward eco-friendly building materials. Fibre cement products, made from natural components like cement, sand, and cellulose fibres, offer a lower carbon footprint and are recyclable. Unlike traditional materials such as clay bricks, fibre cement production is less energy-intensive and free from hazardous substances like asbestos, making it a safer and greener alternative for construction.

Boost from green building certifications and government initiatives: India’s rapid adoption of green building standards, such as LEED (Leadership in Energy and Environmental Design), is further propelling demand for fibre cement boards. These products meet stringent green certification criteria by being durable, sustainable, and low-maintenance, helping buildings achieve higher environmental ratings. Government initiatives like the Swachh Bharat Abhiyan and the National Action Plan on Climate Change emphasize sustainable development, boosting the adoption of eco-friendly construction materials. With over 7,000 green building projects covering 7.3 billion square feet as of 2024, India stands as the second-largest green building market globally, creating massive growth opportunities.

Technological advancements enhancing product performance: Continuous technological innovation is another critical driver fuelling the fibre cement market. Recent advancements have led to the development of moisture-resistant, lighter, and stronger boards, expanding their application in humid regions, coastal areas, and fast-paced construction projects. Enhanced surface finishing technologies now offer a wide range of aesthetic options, including different textures, colours, and patterns, making fibre cement boards attractive for both interior and exterior use. These improvements have significantly reduced installation time and costs while offering architects and builders greater design flexibility.

Expanding application scope with safety innovations: The

introduction of fire-resistant fibre cement boards has broadened their appeal, particularly for projects in fire-prone areas. As modern construction increasingly prioritizes safety, aesthetics, and performance, fibre cement products have evolved to meet these changing demands. Their resistance to termites, mold, fire, and harsh weather conditions, combined with minimal maintenance requirements, solidifies their position as a highly desirable choice for contemporary, sustainable building projects across India.

Government initiatives

Affordable housing demand: Rapid urbanization and population growth have intensified the need for cost-effective and durable housing solutions. Fibre cement boards, known for their strength, moisture resistance, and fire resistance, are increasingly utilized in affordable housing projects across India. Government schemes like the Pradhan Mantri Awas Yojana (PMAY), and ''Housing for all’ further bolster this demand.

Infrastructure development initiatives: Government programs such as the Smart Cities Mission and urban renewal projects necessitate reliable construction materials. Fibre cement boards, with their durability and energy efficiency, align with the sustainable development goals outlined by these initiatives.

Sustainable construction practices: There is a growing awareness and adoption of green building practices in India. Fibre cement boards, being eco-friendly and contributing to better indoor air quality, are preferred in projects aiming for green certifications like LEED and GRIHA.

(Source: Techsci Research)

Indian textiles industry review

As of 2024, the Indian textile and apparel (T&A) market is valued at USD 222.08 billion and is projected to grow at a robust CAGR of 11.98%, reaching USD 646.96 billion by 2033. This growth is propelled by rising demand for premium and sustainable textiles, government incentives, and India’s rich cultural heritage. Global shifts, including political instability in competing textile-exporting nations like Bangladesh, have positioned India as a key sourcing destination for global retailers. Policy measures such as reduced duties on raw materials and flagship initiatives like PM MITRA and the PLI scheme are enhancing India’s manufacturing capabilities and export competitiveness.

Manmade fibres (MMFs), including synthetic (polyester, nylon) and cellulosic (viscose, modal) types, now dominate global fibre consumption—accounting for 75% of the total—due to their durability, affordability, and sustainability. India is aligning with this global trend, emphasizing MMF and technical textile production through targeted investments and infrastructure development. Blended fabrics combining MMFs with natural fibres like cotton are gaining popularity for their enhanced performance and versatility.

India’s textile sector holds a significant global presence, with the second-largest yarn spinning capacity and a leading position in cotton production, contributing about 24% of global output. In FY 2024-25, India’s T&A exports rose by 6.32% to USD 36.61 billion, with apparel exports up 10.03% and textile exports increasing 3.61%. Ongoing infrastructure upgrades, free trade agreements, and the digitalization of textile production are accelerating India’s emergence as a global textile powerhouse.

Growth drivers

Global market shifts and supply chain realignment:

Geopolitical factors, such as the political crisis in Bangladesh, have led global retailers to seek alternative sourcing destinations. India has emerged as a preferred option, with its textile and apparel exports growing by over 7% year-on-year to more than USD 23 billion in the first eight months of FY25. Readymade garment exports, in particular, grew by more than 11% year-on-year, nearing USD 10 billion during the same period.

Expansion of technical textiles: It include products like curtains, drapes, tents, and tarpaulins made from synthetic fibres, are gaining prominence. The industry anticipates India’s exports of man-made fibre textiles to climb 75% to USD 11.4 billion by 2030, up from approximately USD 6.5 billion in 2021-22, driven by the PLI scheme and free trade agreements with countries like the UAE and Australia.

Technological advancements and innovation: Advancements in fibre technology have led to the development of high-performance synthetic fibres with properties such as moisture-wicking, flame retardancy, and recyclability. These innovations are opening new markets and applications, especially in performance apparel and sustainable fashion, further driving the growth of the synthetic fibre industry in India.

(Source: The Economics Times, IBEF, Reuters)

Government initiatives

Q The government approved setting up Seven Pradhan Mantri Mega Integrated Textile Region and Apparel (PM MITRA) parks in greenfield/brownfield sites with an outlay of H4,445 Crore for a period of seven years up to 2027-28.

Q Under the Production Linked Incentive (PLI) scheme the government has an outlay of INR 10,683 Crores, aiming to promote the production of man-made fibre (MMF) apparel, MMF fabrics, and technical textile products.

Q The textile ministry’s budget allocation for FY26 is expected to rise by 15% to INR 5,080 Crores, reflecting the government’s commitment enhancing the sector’s competitiveness.

Q The government has implemented programmes such as SAMARTH for capacity building in the textile sector, the National Handloom Development Programme, the Raw Material Supply Scheme, the National Handicraft Development Programme, the Comprehensive Handicrafts Cluster Development Scheme, and the Integrated Wool Development Programme, among others, to promote the indigenous textile sector.

(Source: Economics Times, Reuters)

India solar energy sector review

As India accelerates its transition to a sustainable future, its renewable energy (RE) sector has experienced unprecedented

growth. In 2024, the country made remarkable progress in solar and wind energy installations, policy advancements and infrastructure development, laying a strong foundation for ambitious 2025 targets. Committed to achieving 500 GW of nonfossil fuel-based energy capacity by 2030, India continues to establish itself as a global leader in clean energy. As of January 2025, the country’s total non-fossil fuel energy capacity has reached 217.62 GW.

In 2024, India added a record-breaking 24.5 GW of solar capacity and 3.4 GW of wind capacity, marking a 2x increase in solar installations and a 21% rise in wind capacity compared to 2023. This growth was fueled by government incentives, policy reforms, and increased investments in domestic solar and wind turbine manufacturing.

Solar energy remained the driving force of India’s renewable expansion, contributing 47% of the total installed renewable energy capacity. Utility-scale solar installations surged, adding 18.5 GW, a nearly 2.8x jump from 2023. The states of Rajasthan, Gujarat, and Tamil Nadu led this growth, accounting for 71% of India’s total utility-scale solar installations.

The rooftop solar sector also experienced significant momentum, with 4.59 GW of new capacity installed a 53% increase from 2023. The PM Surya Ghar: Muft Bijli Yojana, launched in 2024, played a pivotal role in this surge, enabling the installation of 7 lakh rooftop solar systems in just ten months. Meanwhile, the off-grid solar segment witnessed a remarkable 182% rise, adding 1.48 GW, enhancing energy accessibility in rural areas.

India added 3.4 GW of new wind capacity in 2024, with Gujarat (1,250 MW), Karnataka (1,135 MW), and Tamil Nadu (980 MW) leading the sector. These three states alone contributed 98% of the new wind capacity additions, reinforcing their dominance in India’s wind power generation.

With continued government support, rising investments, and technological advancements, India is poised to further accelerate its renewable energy transition, setting new milestones in 2025 and beyond.

(Source: Press Information Bureau)

Growth drivers

Environmental transition driving solar demand: A global transition is underway from conventional energy sources to renewables, driven by growing environmental concerns and the urgent need to reduce carbon emissions. This shift is expected to significantly boost demand for solar energy, making it a central pillar of the country’s sustainable energy strategy.

Extension of the PLI scheme: To bolster domestic manufacturing and reduce dependence on imports, the Production-Linked Incentive (PLI) scheme for solar modules has been extended with an additional outlay of INR 24,000 Crores. This move is aimed at enhancing India’s solar manufacturing capabilities and supporting self-reliance.

Tax incentives for developers: Tax holidays and accelerated depreciation benefits have been offered to solar project developers, making investments more attractive and improving project viability

Modernization of grid infrastructure: An investment of INR 5,000 Crores has been announced for upgrading and expanding grid infrastructure. This is critical for integrating increasing volumes of solar power into the national grid and ensuring energy reliability

Boost to solar research and development: To encourage innovation and cost-efficiency INR 1,500 Crore has been earmarked for research and development in advanced solar technologies. This will support the development of next-generation solar solutions.

[Source: Blue Bird Solar]

Policy support

Increased funding for solar projects: The government has allocated a dedicated fund of INR 10,000 Crore to accelerate the development of large-scale solar parks, rooftop installations, and off-grid solar solutions. This substantial investment is expected to stimulate private sector participation and drive overall industry growth.

Reduction in customs duties: Customs duties on key solar components such as inverters and batteries have been reduced, significantly lowering the cost of setting up solar projects and improving the overall financial feasibility for developers.

Launch of PM Surya Ghar Yojana 2.0: Under the new PM Surya Ghar Yojana 2.0, the government plans to install rooftop solar systems in 10 million households over the next three years. The initiative will be supported by subsidies and access to low-interest loans, promoting residential solar adoption.

Increased allocation for PM-KUSUM: The budget for the PM-

KUSUM scheme has been increased by 3%, reaching INR 2,600 Crore (up from INR 2,525 Crore in FY25). This initiative aims to support farmers by providing solar-powered irrigation, enhancing income, and reducing reliance on diesel pumps.

Promotion of green hydrogen integration: A provision of INR 2,000 Crore has been made for green hydrogen projects powered by solar energy This will help create synergy between the solar and hydrogen sectors, pushing India toward a cleaner energy future.

(Source: Blue Bird Solar, Economic Times)

Financial overview

Analysis of the profit and loss statement

Revenues: Revenue from operations reported 1.31% growth from H1521 Crore in FY 2023-24 to H1541 Crore in FY 2024-25. Other income of the Company accounted for 0.52 % share of the Company’s revenues reflecting the Company’s dependence on its core business operations.

Expenses: Total expenses of the Company increased 1.38% from H1527 Crore in FY 2023-24 to H1548 Crore in FY 2024-25 due to higher costs. Employee expenses accounting for 8.78% of the Company’s revenues and increased by 1.86% from H133.53 Crore in FY 2023-24 to H136.02 Crore in FY 2024-25.

Analysis of the Balance Sheet sources of funds

Q The capital employed by the Company decreased by 4.30% from H1348 Crore as on March 31, 2024 to H1290 Crore as on March 31, 2025.

Q The net worth of the Company decreased from H755.67 Crore as on March 31, 2024 to H750.74 Crore as on March 31, 2025 owing to decrease in reserves and surpluses.

Q Long-term debt of the Company decreased to H168 Crore as on March 31, 2025. The long-term debt-equity ratio of the Company stood at 0.22 in 2024-25 compared to 0.27 in

2023- 24.

Q Finance costs of the Company increased from H36.33 Crore in 2023-24 to H44.24 Crore in 2024-25 following the utilization of full working capital on full year operations The Company’s interest cover stood at a comfortable 2.46 in

2024- 25 compared to 2.72 in 2023-24.

Applications of funds

Fixed assets (gross) of the Company increased by 3.39% from H1061 Crore as of March 31, 2024 to H1097 Crore as on March 31, 2025 due to normal capex incurred.

Other non-Current Assets

Other non-Current Assets of the Company enhanced from H26.09 Crore as on March 31, 2024 to H26.67 Crore as of March 31, 2025.

Working capital management

Q Current assets of the Company decreased from H684.88 Crore as on March 31, 2024 to H666.56 Crore as on March 31, 2025. The current and quick ratios of the Company stood at 1.34 and 0.44, respectively in 2024-25 compared to 1.33 and 0.34 respectively in 2023-24.

Q Inventories including raw materials, work-in-progress and finished goods among others decreased by 14.22% from H425.32 Crore as on March 31, 2024 to H364.82 Crore as on March 31, 2025. The inventory cycle days decreased from 97 days of turnover equivalent in 2023-24 to 95 days of turnover equivalent in 2024-25.

Q Trade receivables increased by 32.60% from H146.43 Crore as on March 31, 2024 to H194.17 Crore as on March 31, 2025. The Company’s debtor turnover cycle increased to 39 days, primarily on account of an extended credit period provided in response to prevailing market conditions during 2024-25, as compared to 33 days in 2023-24.

Q Cash and bank balances of the Company decreased from H38.88 Crore as on March 31, 2024 to H19.57 Crore as on March 31, 2025.

Q Loans and advances (other than capital advances) made by the Company increased by 25% from H52 Crore as on March 31, 2024 to H65 Crore as on March 31, 2025 on account of increase in loans to subsidiaries

Margins

The EBITDA margin of the Company increased by 64 basis points from 6.51% in 2023-24 to 7.15% in 2024-25, while the net profit margin of the Company decreased by 16 basis points.

Particulars	2024-25	2023-24
Debt-equity ratio	0.70	0.77
Return on equity (%)	0.02	0.33
Earnings per share (H) - Basic	0.02	0.29
Debtors Turnover (days)	39	33
Inventory Turnover (days)	95	97
Interest Coverage Ratio	2.46	2.72
Current Ratio	1.34	1.33
EBITDA Margin (%)	7.15	6.51
Net Profit Margin (%)	0.01	0.17

Internal financial control systems and their adequacy

The Company’s internal audit system has been continuously monitored and updated to ensure that assets are safeguarded, established regulations are complied with and pending issues are addressed promptly. The audit committee reviews reports presented by the internal auditors on a routine basis. The committee makes note of the audit observations and takes corrective actions wherever necessary. It maintains constant dialogue with statutory and internal auditors to ensure that internal control systems are operating effectively. Based on its evaluation (as provided under Section 177 of the Companies Act, 2013 and Regulation 18 of SEBI Listing Regulations), the Audit Committee has concluded that as of March 31, 2025, the Internal Financial Controls were adequate and operating effectively.

M/s Price Waterhouse & Co. Chartered Accountants LLP, the Statutory Auditors of the Company audited the financial statements included in this Annual Report and issued a report on the internal controls over financial reporting (as defined in Section 143 of the Companies Act, 2013).

Human resources

The Company believes that its dedicated and motivated employees are its greatest asset. The Company has till now offered competitive compensation, healthy work environment and recognises employee performance through a planned reward and recognition program. The Company intends to

develop a workplace where every employee can recognize and attain his or her true potential. The Company motivates individuals to undertake voluntary projects apart from their scope of work that help them to learn and nurture creative thinking. The Company’s permanent employee strength stood at 1871 as on March 31, 2025.

Cautionary statement

The statement made in this section describes the Company’s objectives, projections, expectations and estimations which may be forward looking statements within the meaning of applicable securities laws and regulations. Forward-looking statements are based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realised by the Company. Actual results could differ materially from those expressed in the statement or implied due to the influence of external factors which are beyond the control of the Company. The Company assumes no responsibility to publicly amend, modify or revise any forwardlooking statements on the basis of any subsequent development, information or events.

Fixed Deposits

During the year under review, your Company has accepted / renewed H0.72 Crores as public deposits and repaid H2.44 Crore upon maturity and the outstanding deposits as on March 31,2025, stood at H11.37 Crores. In this regard, it is further stated that:

a) There were no matured deposits lying unpaid or unclaimed at the end of the year i.e. March 31, 2025

b) There has been no default in repayment of deposits or payment of interest thereon during the year.

c) There are no deposits lying with the Company which are not in compliance with the requirements of Chapter V of the Companies Act 2013 (Act) and

d) As provided under the Act, the outstanding deposits accepted under the provisions of previous Act have been repaid and squared off fully.

Transfer of Unpaid/Unclaimed Dividend and Shares to Investor Education and Protection Fund (IEPF)

As per section 124 of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 and subsequent amendments thereto (“the Rules”), any money transferred to the Unpaid Dividend Account of a company, which remains unpaid or unclaimed for a period of seven years from the date of such transfer shall be transferred by the company along with interest accrued, if any, thereon to the Fund established under sub-section (1) of section 125 and also all shares in respect of which dividends have not been paid or claimed for seven consecutive years or

more shall be transferred to Investor Education and Protection Fund (IEPF). In line with the aforesaid provisions, unclaimed dividend declared for the FY 2017-18 along with the underlying shares on which dividend has not been claimed for a period of seven consecutive years are being transferred to IEPF.

The List of shareholders whose dividends / shares have been transferred to IEPF is available on the website of the company at https://visaka.co/investors/iepf_shares_2024_25

Banks and financial institutions

Your Company is prompt in making the payment of interest and repayment of loans to the financial institutions/banks and they continue their unstinted support in all aspects to the company. The Board records its appreciation for the same.

Corporate social responsibility

During the Financial Year 2024-25, the company has spent an amount of H2.77 Crores on CSR activities against the minimum CSR obligation of H1.64 Crore. The Board of Directors resolved that the excess amount spent shall be shown as prepaid expenditure and will setoff against future CSR obligation as per the provisions of the companies act 2013 and rules made thereunder.

A report on CSR activities as required under Rule 8 of the Companies (Corporate Social Responsibility) Rules, 2014 is enclosed as Annexure-2.

CSR policy of the Company and CSR expenditure made during the FY 2024-25 can be accessed on the Company’s website at the link:

https://www.visaka.co/assets/website/files/investors/CSR-policy.pdf and https://visaka.co/assets/website/files/investors/ CSR-Composition-and-CSR-spent-details-2024-25.pdf

Directors and Key Managerial Personnel

As on March 31, 2025, Smt. G. Saroja Vivekanand (DIN: 00012994), Managing Director, Shri G. Vamsi Krishna (DIN: 03544943), Joint Managing Director, Shri J.P. Rao (DIN: 03575950), Whole-time Director, Shri S. Shafiulla, President & CFO and Shri Ramakanth Kunapuli, AVP & Company Secretary are Key Managerial personnel of the Company in accordance with the provisions of Section 2(51) and 203 and other applicable provisions of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial personnel) Rules, 2014. During the year under review, on February 14,2025, based on the recommendation of the Nomination and Remuneration Committee and subject to the approval of the members of the company the Board of directors of the Company has re-appointed Smt. Vanitha Datla and Shri G Appnender Babu, as Independent Directors for a second term of five consecutive years with effect from May 26, 2025 and the Company has obtained approval of its members on April 10, 2025 for the same.

Dr. G. Vivek Venkatswamy (DIN- 00011684) is liable to retire by rotation at the ensuing annual general meeting and being eligible, offers himself for reappointment. Dr. G. Vivek Venkatswamy, a Non-executive, Non-independent Director holding 3,43,65,215 Equity Shares of H2/- (Rupees Two) each of the Company.

The Board in its meeting held on April 08, 2025 has appointed Shri Abinash Mishra as a Chief Executive Officer (CEO) of the company effective from April 14, 2025.

Independent Directors have submitted requisite declaration of independence, pursuant to Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as provided in sub-section (6) of Section 149 of the Companies Act, 2013 read with sub rule (1) and (2) of Rule 6 of Companies (Appointment and Qualification of Directors) Rules, 2014 as amended.

Directors’ Responsibility Statement

Pursuant to Section 134(5) of the Companies Act, 2013, Directors of your Company state that:

a) In the preparation of the annual accounts for the year ended March 31, 2025, the applicable accounting standards have been followed and there were no material departures.

b) They have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the company for the said period.

c) 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.

d) They have prepared the annual accounts on a going concern basis.

e) They have laid down internal financial controls in the Company that are adequate and are operating effectively and

f) They have devised proper systems to ensure compliance with the provisions of all applicable laws and these are adequate and operating effectively.

Corporate Governance

Pursuant to the provisions of Chapter IV read with Schedule II & V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on Corporate Governance has been incorporated in the Annual Report for the information of the members along with a certificate issued by the Statutory Auditors of the Company regarding compliance with the conditions of Corporate Governance, as stipulated under the said Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of this Report.

Statutory Auditors and Auditors’ Report

M/s. Price Waterhouse & Co., Chartered Accountants LLP (FRN 304026E/E300009), Hyderabad who were appointed as statutory auditors of the Company to hold the office from the conclusion of the 40^th annual general meeting till the conclusion of 45^th annual general meeting to be held in the year 2027 audited the books of the Company for the financial year 2024-25 and submitted their report(s) (both standalone and consolidated) and the said report(s) does not contain any modifications or adverse remarks.

Internal Auditors

The company has a full-time in-house internal audit team, which regularly monitors the effectiveness of the internal control systems. This function reports to the Audit Committee and the Managing Director/Joint Managing Director about the adequacy and effectiveness of the internal control systems of the company as well as the periodical results of its review of the company’s operations as per an approved internal audit plan duly approved by the Audit Committee.

The recommendations of the internal audit team for improvements in the operating procedures and control systems for strengthening the operating procedures are presented periodically to the Audit Committee.

During the year under review internal audit team have not reported any matter under Section 143(12) of the Act, and therefore no details are required to be provided under Section 134(3)(ca) of the Act.

Cost audit:

In terms of the Section 148(1) of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the Company is required to maintain cost records pertaining to Building Products Division and Textile Products Division and stipulated cost records pertaining to the said divisions are maintained.

M/s. Sagar & Associates, Cost Accountants (Firm Regn. No. 000118) Hyderabad, were re-appointed as Cost Auditors of the Company by the Board of Directors on May 15, 2024, based on the recommendation of Audit Committee, for conducting the cost audit for the financial year 2024-25 at a remuneration of H1,65,000/- (exclusive of out-of-pocket expenses and applicable taxes) and the fees was ratified by the member of the company at the 42^nd Annual General Meeting of the Company.

The Board after considering the recommendations of its Audit Committee, reappointed the aforesaid firm as cost auditors for the financial year 2025-26 at a remuneration of Rs. 1,65,000/-(exclusive of out-of-pocket expenses and applicable taxes) and appropriate resolution in this connection has been included in the notice convening the ensuing Annual General Meeting of the

Company for ratification of remuneration of the Cost Auditors. Cost audit report for the financial year ended March 31, 2024, was filed with the Central Government on September 09, 2024. Cost auditors have certified that their appointment is within the limits prescribed under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified to undertake the Cost Audit assignment within the provisions of the Act.

During the year under review Cost Auditors have not reported any matter under Section 143(12) of the Act, and therefore no details are required to be provided under section134(3)(ca) of the Act.

Secretarial audit:

The Board has appointed M/s. GMR & Associates, Company Secretaries, (Membership No. 8463 & CP No. 7911) Hyderabad as Secretarial Auditors of the Company for the financial year 2024-25 to conduct secretarial audit.

The Secretarial Auditors M/s. GMR & Associates, Hyderabad appointed by the Board conducted the secretarial audit and issued report in Form MR-3 which is enclosed as Annexure-3.

In accordance with the SEBI Circular dated February 8, 2019 and additional affirmations required under Circulars issued by NSE and BSE dated March 16, 2023 and April 10, 2023 read with Regulation 24A of the Listing Regulations, the Company has obtained an Annual Secretarial Compliance Report from M/s. GMR & Associates, Practising Company Secretaries, confirming compliances with all applicable SEBI Regulations, Circulars and Guidelines for the year ended March 31, 2025.

M/s. GMR & Associates, Practising Company Secretaries, Hyderabad has issued a certificate confirming that none of the Directors on the Board of the Company has been debarred or disqualified from being appointed or continuing as Directors of companies by SEBI/MCA or any such statutory authority. The said Certificate is annexed to the Report on Corporate Governance

In terms of Regulation 24A read with other applicable provisions of the SEBI Listing Regulations and Section 204 read with other applicable provisions of the Companies Act, 2013, the Company is required to appoint Secretarial Auditors for a period of Five (5) years commencing from FY2025-26, to conduct the secretarial audit of the Company.

As per the aforesaid provisions, the Board in its meeting held on May 21, 2025, based on the recommendation of the Audit Committee and subject approval of the members of the Company in the ensuing Annual General meeting appointed M/s. GMR & Associates as Secretarial Auditors of the Company for a period of five years commencing from the conclusion of the ensuing 43^rd Annual General Meeting scheduled to be held on July 30, 2025, till the conclusion of 48^th Annual General Meeting of the Company to be held in the year 2030, for conducting secretarial audit of the Company for the period beginning from FY2025-26 till FY2029-30.

The report of the Secretarial Auditors for the financial year 2024-25 is a clean report and does not contain any qualifications or adverse remarks.

During the year under review Secretarial Auditors have not reported any matter under Section 143(12) of the Act, and therefore no details are required to be provided under section 134 (3) (ca) of the Act.

Criteria for identification, appointment, remuneration and evaluation of performance of Directors

Your Company constituted Nomination and Remuneration Committee (hereinafter referred to as “the NRC Committee”), to oversee, inter-alia, matters relating to:

a) Identify persons who are qualified to become directors and persons who can be appointed in senior management in accordance with the criteria laid down, and to recommend to the Board their appointment and removal.

b) Formulate the criteria for determining qualifications, positive attributes and independence of a director.

c) Recommend to the Board a policy relating to the remuneration to the directors, key managerial personnel and other senior management employees.

d) Carry out the performance evaluation of every director including that of Independent Directors and board as a whole, committees of the Board etc,.

e) Devise a policy for identification, appointment, remuneration and evaluation of performance of directors including Company’s Board diversity etc., as approved by the Board.

The criteria for appointment, qualifications and positive attributes along with remuneration policy as applicable to Directors, KMPs and other Senior management personnel and the criteria to be followed for performance evaluation of each director including Independent Directors of the Company is enclosed as Annexure-4.

Formal annual evaluation made by the Board of its own performance, its committees and of individual directors.

Your Company believes that it is the collective effectiveness of the Board that impacts the Company’s performance and thus the primary evaluation platform is that of collective performance of the Board.

The parameters for evaluation of Board’s performance, as laid under evaluation criteria adopted by the Company, have been derived from the Board’s core role of trusteeship to protect and enhance shareholder’s value as well as fulfil expectations of other stakeholders through strategic supervision of the Company.

The said criteria also include evaluation of directors based on their overall performance, in addition to their specific roles as Independent, Non-Executive, and Executive Directors, as outlined below:

a. Every director will be evaluated on discharging their duties and responsibilities as enshrined under various statutes and regulatory facet, participation in discussions and deliberations in achieving an optimum balance between the interest of company’s business and its stakeholders.

b. Executive Directors will also be evaluated based on targets / criteria set by the Board from time to time in addition to their terms of appointment.

c. Independent Directors will also be evaluated on discharging their obligations in connection with their independence criteria as well as adherence with the requirements of professional conduct, roles, functions, and duties, specifically applicable to Independent Directors as contained in Schedule IV to the Companies Act, 2013.

The criteria also specify that the Board would evaluate each committee’s performance based on the mandate under which the committee has been constituted and the contributions made by each member of the said committee in effective discharge of their responsibilities.

The Board of Directors of your Company has made an annual evaluation of its performance, its committees and directors and the performance of the Chairman for the financial year 2024-25 based on aforesaid criteria.

Particulars of loans, guarantees or investments.

Details of investments/loans made by the Company, are given in the notes to the standalone financial statements (Please refer Note Nos. 5 & 6.1). During the year under review, your Company did not give or provided any other loans or guarantees, security or made any investments as covered under Section 186 of the Companies Act, 2013, other than as disclosed above.

Related party transactions

All related party transactions entered during the financial year ended March 31, 2025 are in the ordinary course of business and are at an arm’s length basis and requisite approvals were obtained prior to entering the related party transactions. Further prior omnibus approval of the Audit Committee was obtained for the transactions which are of a repetitive nature and these related party transactions are reviewed by the Audit committee on a quarterly basis.

In terms of the Act and Rules framed thereunder read with the SEBI Listing Regulations, no material related party transactions were entered during the financial year ended March 31, 2025 by your Company. Members may refer to Note No. 41 to the standalone financial statements which sets out related party

disclosures pursuant to IND AS-24. During the year under review, the Company did not enter into any material related party transactions. Accordingly the disclosure of related party transactions under section 134(3)(h) of the Companies Act, 2013 in FORM AOC-2 is not applicable to the Company for the financial year 2024-25 and hence does not form part of the report.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company’s website at https://visaka.co/assets/ website/files/investors/Related-Party-Transactions-Policy.pdf

Risk Management

The Company has established an enterprise Risk Management process to manage risks with the objective of maximizing shareholders value.

The Board of Directors of the Company has Constituted Risk Management Committee to implement and monitor the risk management Policy of the Company. During the year under review, Risk Management Committee and the Board have periodically reviewed various elements of the risks and steps taken to mitigate the same. The development and implementation of the risk management policy has been covered in the Management Discussion and Analysis, which forms part of this report.

Other disclosures Board Meetings:

During the year under review, the Board met five times i.e., on May 15, 2024, August 12, 2024, November 12, 2024, February 14, 2025, and March 26, 2025. Details viz., members of the Board and their attendance etc., are given in report on Corporate Governance which forms part of this Annual Report.

Audit Committee:

As on March 31, 2025, the Audit Committee comprises of four directors i.e., three Independent Directors viz., Smt. Vanitha Datla (Chairperson), Shri Sanjay Vijay Singh Jesrani, Shri P Srikar Reddy and Smt. G Saroja Vivekanand, Managing Director as members. All the recommendations made by the Audit Committee were accepted by the Board.

The Chairperson of the Audit Committee has attended 42^nd Annual General Meeting.

Compliance with Secretarial Standards

The Company has complied with applicable provisions of the Secretarial Standards issued by the Institute of Company Secretaries of India under Section 118(10) of the Companies Act, 2013.

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

Information required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is enclosed herewith as Annexure-5.

Annual Return

As required under Section 92(3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Amendment rules, 2020, Annual Return for the financial year 2024-25 is available on the Company’s website at https://visaka.co/assets/website/files/investors/ Annual-Returns-2024-25-Form-MGT-7.pdf

Remuneration of Directors, Key Managerial Personnel, Employees and General

Statement showing disclosures pertaining to remuneration and other details under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed as Annexure-6. In terms of Section 197(12) of the Companies Act, 2013, read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the top ten employees in terms of the remuneration drawn as set out in said rules forms part of the annual report. Considering the first proviso to Section 136(1) of the Companies Act, 2013, this annual report, excluding the aforesaid information, is being sent to the shareholders of the Company and others entitled thereto. The said information is available for inspection at the Registered office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. Any shareholder interested in obtaining a copy thereof, may write to the Company Secretary in this regard.

Business Responsibility and Sustainability Report

Pursuant to Regulation 34(2)(f) of the SEBI Listing Regulations, “Business Responsibility and Sustainability Report (BRSR)” of the company for the financial year ended March 31, 2025, is annexed as Annexure-7

Vigil Mechanism

In accordance with the provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, the Company established a Vigil Mechanism to report genuine concerns by all its stakeholders. The Audit Committee of the Board periodically reviews the complaints received if any under the policy. The Company has not received any complaints from any of its stakeholders during the financial year 2024-25.

The Whistle Blower Policy has been uploaded on the website of the Company at https://www.visaka.co/assets/website/files/ investors/Vigil-Mechanism-Whistle-Blower-Policy.pdf

General

Your directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

i. Issue of equity shares with differential rights as to dividend, voting or otherwise.

ii. Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

iii. No significant or material orders were passed by any regulator or Court or Tribunal which impacts the going concern status and Company’s operations in future.

iv. Details in respect of frauds reported by auditors under sub-section (12) of Section 143 other than those which are reportable to the Central Government.

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

vi. The details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year.

vii. The details of difference between amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.

viii. There are no qualification, reservation or adverse remark or disclaimer made by the auditors in their report and by the company secretary in practice in his secretarial audit report.

Your directors further state that

a) The Company has complied with the provisions of constitution of internal complaints committee under the sexual harassment of women at workplace (prevention, prohibition, and redressal) Act, 2013 and

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

Acknowledgements

Your directors would like to express their sincere appreciation for the assistance and co-operation received from the financial institutions, banks, government authorities, customers, vendors, members and other stakeholders during the year under review. Your directors also wish to place on record their deep sense of appreciation for the committed services by the Company’s executives, staff and workers.

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Mar 31, 2024

The directors are pleased to present the 42^nd Annual Report on the operational and business performance of the Company together with the Audited Financial Statements (Standalone and Consolidated) for the Financial Year ended March 31, 2024.

Financial Performance

The summarized financial performances for the Financial Year ended March 31, 2024, are as under:

(Rs. in Lakhs)
Particulars	Standalone		Consolidated
1	2023-24	2022-23	2023-24	2022-23
Total Revenues	1,53,136	1,65,759	1,53,735	1,66,396
Profit before depreciation and Taxes	6,245	12,465	6,194	12,378
Profit before taxes	449	7,446	299	7,357
Provision for taxes (Including Deferred tax)	196	1,967	213	1,999
Total comprehensive Income	5	5,441	(163)	5,321
Dividend	1,728	1,382	1,728	1,382
Balance brought forward from previous year	40,420	36,362	40,279	36,341
Profit available for appropriation	38,697	40,420	38,389	40,279

Performance review and the state of Company''s affairs:

The company''s consolidated total income for the year 2023-24 is H1537 Crores down by 7.63% over the previous financial year and the standalone total income for the year 2023-24 is H1,531 Crores down by 7.66% over the previous financial year.

The Company has experienced drop in revenue during the financial year under review due to general economic slowdown and lower global demand. The drop in revenue is significant in textile business and to some extent in building product segments also. Lower volumes in textile and building products due to general slowdown in the economy and cashflow issues across the market also contributed to lower turnover. The company''s performance is impacted due to continued rise in raw material costs since last accounting year 2022-23 due to Russia and Ukraine war. The higher interest rates due

to inflation across the globe, higher depreciation on the new units which were setup during past two years also impacted the profitability during the year.

The Company made standalone profit after tax of H2.53 Crores during the current financial year compared to H54.79 Crores in the previous financial year. The company is expecting to have a significant growth in the coming years as it is foreseeing good economic indicators with good monsoons in the coming year. The company has aggressively expanded during the last two years by setting up an additional production line of cement roofing business and two fibre cement board units along with one Panel unit to take advantage of economies in logistic and operational costs.

The Company''s other key performance indicators are as under:

Cash Profit during the current year is H61 crores as compared to H105 crores in the previous year.

The capital expenditure for FY 2023-24 was H118 crores, major part was towards V Next Boards project at Midnapore, West Bengal state.

CAPITAL

During the financial year under review there is no change in the capital structure of the Company other than the sub-division of face value of shares from H10/- (Rupees Ten ) to H2/- (Rupees Two).

DIVIDEND

The Board of Directors of the Company, in their meeting held on May 15, 2024 had recommended a Final Dividend of H0.50/-(Fifty paise only) (i.e., 25%) per Equity Share of H2/- (Rupees Two) each fully paid-up share of the Company, for the Financial Year 2023-24.

The Final dividend, if approved at the 42^nd Annual General Meeting (AGM), will be paid to all eligible members within thirty days from the conclusion of the ensuing Annual General Meeting of members of the Company.

TRANSFER TO RESERVES

For the financial year ended March 31, 2024, the company has not proposed to transfer any amount to the general reserve

SUBSIDIARY COMPANIES

The Company has two subsidiaries, i.e., Visaka Green Private Limited (earlier named Vnext Solutions Private Limited) and Atum Life Private Limited as on March 31, 2024.

Visaka Green Private Limited was setup to capitalise on the expertise gained in the various applications of its products. viz., EPC contracts, Turnkey solutions, construction of Infil houses with Atum Solar panels, V-Boards, V-Panels and Infil material.

Atum Life Private Limited was formed to deal with the sustainable and eco-friendly products. The Company had set up sustainable studios to deal with various range of sustainable products including the holding company''s sustainable products. The Company has put up Atum charging stations which provides clean energy to consumers. ATUM Charge is India''s First Green EV charging stations, and it is powered by our own ATUM Solar roofing. The Company aims for Zero emissions, net zero facilities and sustainable network.

The Statement containing salient features of the financials of Subsidiaries / associate companies / joint ventures (Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014) in form AOC-1 is annexed as Annexure-1.

In terms of Section 129(3) of the Companies Act, 2013, the consolidated financial statements of the company and all its subsidiaries prepared in accordance with Ind AS 110 and 111 as specified in the Companies (Indian Accounting Standards) Rules, 2015, forming part of this annual report. In accordance with Section 136 of the Companies Act, 2013, the audited financial statements and related information of the company and its financial subsidiaries, available on the company''s website:(please refer page no. - 121) .These are also available for inspection during regular business hours at our corporate office in Hyderabad, India.

Management Discussion and Analysis Report Global economy

Overview: Global growth declined from 3.5 percent in 2022 to 3.0 percent in 2023. Asia is expected to contribute significantly to global growth in 2023-24, despite the weaker-than-expected recovery in China, sustained weakness in USA, rising energy costs in Europe, weak global consumer sentiment due to the Ukraine-Russia war and the Red Sea crisis resulting in increased logistics costs. A tightening monetary policy translated into increased policy rates and interest rates for new loans.

Growth in advanced economies is estimated to decline from 2.6% in 2022 to 1.5% in 2023 and further, 1.4% in 2024 as policy tightening takes effect. Emerging market and developing countries are projected to report a modest decline in economic growth from 4.1% in 2022 to 4.0% in 2023 and 2024. Global inflation is projected to decline steadily from 8.7% in 2022 to 6.9% in 2023 and 5.8% in 2024 on account of a tighter monetary policy coupled with relatively lower international commodity prices. Core inflation is expected to decrease gradually, as inflation is not expected to return to its target until 2025 in most cases. The US Federal Reserve approved a much-anticipated interest rate hike raising the benchmark borrowing costs to their highest in over 22 years.

Global trade in goods was expected to have decreased by an approximate US$2 trillion in 2023; trade in services increased by an estimated US$500 billion. The average cost of Brent crude oil in 2023 stood at US$83 per barrel, a downturn as compared to US$101 per barrel in 2022. This decrease comes on account of Russia finding crude oil destinations outside the European Union and global crude oil demand falling short of expectations.

Global equity markets ended 2023 on a strong note, with major global equity benchmarks achieving double-digit returns. This outperformance was driven by a downturn in global inflation, slide in the dollar index, declining crude prices and higher expectations of rate cuts by the US Fed and other Central banks.

Regional growth (%)	2024	2023
World output	3.1	3.5
Advanced economies	1.69	2.5
Emerging and developing	4.1	3.8
economies

Performance of major economies, 2023 United States: Reported GDP growth of 2.5% in 2023 compared to 1.9% in 2022

China: GDP growth was 5.2% in 2023 compared to 3% in 2022

United Kingdom: GDP grew by 0.1% in 2023 compared to 4.3% in 2022

Japan: GDP grew 1.9% in 2023 unchanged from a preliminary 1.9% in 2022

Germany: GDP contracted by 0.3% in 2023 compared to 1.8% in 2022

(Source: PWC report, EY report, IMF data, OECD data, Livemint)

Outlook: Asia is poised to continue leading global growth in 2024-25. Inflation is expected to ease gradually as cost pressures decreases; headline inflation in G20 countries is projected to decline. Amid high inflation and monetary tightening, the global economy has shown resilience as the growth is expected to be stabilised at previous levels over next two years (Source: World Bank)).

Indian economy

Overview: The Indian economy was estimated to grow 8.2 per cent in 2023-24 as against 7.2% in 2022-23 primarily driven by improved performance in the mining and quarrying, manufacturing and certain segments of the services sector. India has maintained its position as the fifth largest economy in the world. The Indian rupee displayed relative resilience compared to the previous year; the rupee opened at H82.18 against the US dollar on the first trading day of 2023-24 and closed at H83.34 versus the greenback on the last trading day of the year under review, an appreciation of 1.41%.

In the 11 months of 2023-24, the CPI inflation experienced an average of 5.4% with rural inflation exceeding urban inflation. Food inflation experienced a spike on account of lower production and erratic weather. Core inflation, on the other hand, averaged at 4.5%, down from 6.2% in 2022-23, moderated by softening global commodity prices.

India''s foreign exchange reserves reached a historic peak of US$651.5 billion. The credit quality of Indian

companies remained robust from October 2023 to March 2024 on account of deleveraged Balance Sheets, sustained domestic demand and government-led capital expenditure. Rating upgrades continued to surpass rating downgrades in the second half of 2023-24. UPI transactions in India witnessed a record 56% growth in volume and 43% growth in value in 2023-24.

Growth of the Indian economy
	FY 21 FY 22	FY23	FY24
Real GDP growth (%) -6.6% 8.7		7.2	8.2
Growth of 2023-24	the Indian economy quarter by quarter,
	Q1FY24 Q2FY24 Q3FY24		Q4FY24
Real GDP growth (%)	8.2 8.1	8.4	7.8

(Source: Budget FY24; Economy Projections, RBI projections, Deccan Herald)

India''s monsoon in 2023 hit a five-year low, with August marking the driest month in a century. Despite receiving only 94% of its long-term average rainfall from June to September, wheat production estimatedly recorded 114 million tonnes in the 2023-24 crop year due to higher coverage. Rice production was anticipated to decrease to reach 106 million metric tons (MMT) in comparison to 132 million metric tonnes in the previous year. Total kharif pulses produced in 2023-24 stood at an estimated 71.18 lakh metric tonnes, which is lower than 202223 due to climatic conditions. As per the first advance estimates of national income released by the National Statistical Office (NSO), the manufacturing sector output is projected to have grown 6.5% in 2023-24 compared to 1.3% in 2022-23. The Indian mining sector experienced an estimated growth of 8.1% in 2023-24 compared to 4.1% in 2022-23. Financial services, real estate and professional services grew a projected 8.9% in 2023-24 compared to 7.1% in 2022-23.

Real GDP or GDP at constant prices increased from to H160.71 lakh crore in 2022-23 (provisional GDP estimate released on 31 May 2023) to an estimated H173.82 lakh crore in 2023-24. Growth in real GDP during 2023-24 stood at 8.2% compared to 7.2% in 2022-23. Nominal GDP or GDP at current prices was estimated at H295.36 lakh crore in 2023-24 as compared to the provisional 202223 GDP estimate of H269.50 lakh crore. The gross nonperforming asset ratio for scheduled commercial banks improved from 4.1% as of March 2023 to 2.8% as of March 2024.

India''s exports of goods and services were expected to reach US$900 billion in 2023-24 compared to US$770 billion in the previous year despite global headwinds. Merchandise exports were expected to expand between

US$495 billion and US$500 billion, while services exports were expected to touch US$400 billion during the year. India''s net direct tax collection increased 17.7% to H19.58 lakh crore in 2023-24. Gross GST collection amounted to H20.2 lakh crore, marking an 11.7% increase, with an average monthly collection of H1,68,000 crore, surpassing the previous year''s average of H1,50,000 crore.

The agriculture sector projectedly grew 1.8% in 2023-24, which is lower than the 4% expansion recorded in 202223. Trade, hotel, transport, communication and services related to broadcasting segment are estimated to grow at 6.3% in 2023-24, a contraction from 14% in 2022-23. The Indian automobile segment was expected to close 202324 with a growth of 6-9%, despite global supply chain disruptions and rising ownership costs. The construction sector was expected to grow 10.7% year-on-year from 10% in 2023-24. Public administration, defence and other services were projected to grow by 7.7% in 2023-24 as against 7.2% in 2022-23. The growth in gross value added (GVA) at basic prices was pegged at 6.9%, down from 7% in 2022-23.

India entered a pivotal phase in its S-curve, marked by rapid urbanisation, industrialisation, increase in household incomes and rising energy consumption. The country emerged as the fifth largest economy with a GDP of US$3.6 trillion and nominal per capita income of H123,945 in 2023-24.

In 2023-24, India''s Nifty 50 index experienced a 30% growth, propelling India''s stock market to become the fourth largest globally with a market capitalisation of US$4 trillion. Foreign investment in Indian government bonds saw a significant increase in the final quarter of year 2023. India ranked 63^rd out of 190 economies in the ease of doing business, according to the latest World Bank annual ratings. Moreover, India''s unemployment rate decreased to 3.2% in the year 2023, down from 6.1% in 2018.

Outlook: India successfully tackled its global economic challenges in the year 2023 and is poised to continue as the world''s fastest-growing major economy backed by a growing demand, moderate inflation, stable interest rates and robust foreign exchange reserves. The Indian economy is anticipated to surpass US$4 trillion in 2024-25.

Union Budget 2024-25

The Interim Union Budget 2024-25 continued to prioritise capital expenditure spending, comprising investments in infrastructure, solar energy, tourism, medical ecosystem and technology. In 2024-25, the top 13 ministries in terms of allocations accounted for 54% of the estimated total expenditure. Of these, the Ministry of Defence received the highest allocation at H6,21,541 crore, constituting 13% of the total budgeted expenditure of the

central government. Other ministries with high allocation included Road transport and highways (5.8%), Railways (5.4%) and Consumer Affairs, food and public distribution (4.5%). (Source: Times News Network, Economic Times, Business Standard, Times of India).

Construction and building materials industry review

The global construction materials market size was estimated at US$1,320.01 billion in 2023 and is forecasted to grow from 1,369.86 billion in the year 2024 to US$1,867.16 billion by the year 2032, growing at a CAGR of 3.9% during the time span. This growth is accounted by the overall development of the construction industry, rise in infrastructure spending and growing demand for residential apartments.

The Indian construction materials recorded a growth of 8% to reach US$240 billion in 2023, post a 10% growth in the year 2022. This steady market growth is driven by ongoing infrastructure development, urbanisation and various government initiatives, implementation of new technologies, emphasis on materials and increasing demand for affordable housing and industrial spaces have influenced the market dynamics of construction materials.

The Central government increased capital outlay on infrastructure development by a third to a record H10 lakh crore in the 2023-24, comprising 3.3% of the GDP. While the allocation towards road construction was raised to H2.7 lakh crore, the outlay was additionally increased for building tracks, reviving 50 additional airports, heliports and advance landing grounds to enhance regional air connectivity. Overall, India has set an ambitious aim of spending H143 lakh crore to develop infrastructure over seven fiscal years through 2030, double of the H63 lakh crore spent in the previous seven years starting 2017, catalysing the market for building materials.

Outlook

The construction materials industry in the country is poised for a transformative phase marked by innovation and advancements. Furthermore, the nation is on track to witness expected and unexpected trends to come up with more eco-friendly and cost-effective solutions that will address the evolving and rising demands. The partnership among the industry players and government support to research and development will further contribute to the pivotal tasks to carve a future where Indian construction materials align with global goals as well as India''s growing requirements in infrastructure sector.

(Source: Economic Times, homes India magazine.com, Equipment Times, Global News Wire, Fortune Business Insights)

Growth drivers

Infrastructure outlay: The Government increased its capital expenditure on infrastructure investment by 11.1% to H11.11 lakh crore for 2024-25. This is expected to catalyse the growth in construction and building materials sector.

Growing urbanisation: By the year 2030, India''s urban population could reach 600 million people, a little less than twice the size of America''s population. This is likely to catalyse housing demand growth and drive the building materials segment.

Population: India emerged as the most populous country surpassing China. The country''s population is expected to grow sustainably, catalysing housing offtake.

Increased middle-class : The size of India''s middle-class is expected to nearly double to 61% of its total population by 2047. The growing middle-class population is expected to drive the demand for housing.

Rising disposable income: According to Euromonitor International''s Economies and Consumers data, the disposable income of Indians recorded a 10.5% CAGR over the period from year 2018-2023. The growth in disposable income is expected to catalyse housing demand.

Increased foreign investment: India attracted record FDI inflows of US$70.95 billion in 2023-24 and FDI equity inflows of US$71 billion, catalysing the demand for new construction.

Preference for green buildings: The construction industry is undergoing a significant shift due to technological advancements and a growing inclination towards eco-friendly buildings. This evolution in building practices is driving a surge in the need for sustainable construction materials.

(Source: Bank Bazaar, InvestIndia)

Government initiatives

¦ The Government decided to continue the 50-year interest free loan to state governments for one more year to spur investment in infrastructure and to incentivise complementary policy actions with a significantly enhanced outlay of H1.3 lakh crore.

¦ 100 critical transport infrastructure projects for last and first mile connectivity for ports, coal, steel, fertiliser and food grains sectors have been identified and will be taken up on priority with investment of H75,000 crore (US$9 billion) including H15,000 crore (US$1.8 billion) from private sources.

¦ An Urban Infrastructure Development Fund is expected to be established through the use of priority sector lending shortfall, which will be managed

by the National Housing Bank and used by public agencies to create urban infrastructure in Tier 2 and Tier 3 cities.

¦ The Awas Yojana budget estimate for the 202324 constitutes an allocation of H25,103 crore (US$3 billion) to Pradhan Mantri Awas Yojana-Urban and H54,487 crore (US$6.5 billion) to Pradhan Mantri Awas Yojana-Gramin.

¦ States will be encouraged to set up a Unity Mall in their state capital or most prominent tourism centre or the financial capital for promotion and sale of their own ODOPs (one district, one product).

¦ The Government of India announced the Atmanirbhar Bharat Abhiyan package of H20 lakh crore in May 2020, which included the Pradhan Mantri Garib Kalyan Yojana (PMGKY) relief package of H1.70 lakh crore for the poor to overcome the difficulties brought by lockdown. The Atmanirbhar Bharat scheme is expected to boost domestic industries, micro, small and medium enterprises (MSMEs) propelling the demand of real estate market.

¦ The budget for Atal Mission for Rejuvenation and Urban Transformation (AMRUT) has been set at H50,000 crore for five years, accompanied by Smart City allocations of H48,000 crore for the housing sector development.

¦ The Smart Cities Mission received a budgetary allocation of H2,236 crores in 2024-25.

(Source: The Secretariat, The Wire, Fincash, Economic Times)

Fibre cement products market review

The Indian fiber cement market is expected to reach US$4.2 million by 2027 growing at a CAGR of 6.7% during 2022-2027 on account of increased building activities across the nation. Fiber cement boards and sheets are composite building and construction materials primarily used in roofing and facade products due to their strength and durability.

The demand for fiber cement boards and sheets is further driven by stringent regulations against the use of nonsustainable products in construction due to the health risks associated with its use across India. Furthermore, the growing demand for energy efficient buildings is boosting the growth of the market. However, the threat from substitutes like vinyl and wood siding is expected to stagger the growth of the fiber cement boards market in India.

South India dominated the Indian fiber cement market share with more than 32.9% followed by North India. India witnessed significant foreign investment in both

residential and non-residential markets, creating new possibilities for fiber cement industry stakeholders in both residential and commercial building landscapes. Besides, clients in the area are aware of the possible dangers of using asbestos cement as a building and construction material and regulatory bodies are urging end-users to resort to substitutes that are more durable and environmentally sustainable. This has caused a transformation around the country from standard cement to fiber cement.

Indian textiles industry review

The Indian textiles and apparels industry with a market size of US$197.2 billion in the year 2023, anticipated to reach US$592.7 billlion in 2032 at a CAGR of 12.6%. The nation accounts for 24% of the global spindle capacity and 8% of the rotor capacity.

India''s textile and apparel trade accounts for 4% globally, contributing 2.3% to the nation''s GDP, 13% to industrial production and 12% to exports. The textiles sector is the second-largest employer employing 45 million people, constituting 13% of India''s industrial production. The industry is highly dependent on cotton, representing over 60% of total fiber consumption.

India is the second largest country in terms of yarnspinning capacity in the world after China, accounting for around 20% of the world''s spindle capacity. Furthermore, the nation ranks as the third largest producer of cotton, accounting for 15% of the global cotton crop.

The country''s textile exports stood at the third position globally at US$37.11 billion, behind China (US$176 billion) and Germany (US$38.99 billion).

(Source: reogma.com, Imarc Group)

Growth drivers

Economical: The emphasis has shifted towards utilising low-cost fibers in clothing production due to the rising importance of cost competitiveness.

Demand-supply gap in cotton: The global demand for fibers continues to grow, driven by a rising world population and increased consumer prosperity in developing countries. However, despite this escalating demand, the supply of cotton which is essential in meeting these fiber needs—is not keeping pace. The reduction in land allocated to cotton cultivation is a consequence of competing interests for land use, such as the cultivation of other lucrative cash crops, food crops, as well as the expansion of industrial and urban areas.

Increased consumer trends: There is a growing focus on fitness, hygiene and brand awareness, all driven by rapidly evolving fashion preferences. This shift has led

to the prominence of sportswear, performance wear and athleisure as dominant categories in the market.

Recyclable: Synthetic fibers can be blended with materials such as cotton and spandex to meet specific performance needs. Recycled polyester has now earned a well-deserved reputation as an eco-friendly choice in the world of textiles.

Government initiatives

¦ The government approved setting up of Seven Pradhan Mantri Mega Integrated Textile Region and Apparel (PM MITRA) parks in greenfield/brownfield sites with an outlay of H4,445 crore for a period of seven years upto 2027-28.

¦ The government approved a production-linked incentive scheme for textiles, with an approved outlay of H10,683 crore to promote the production of man-made fibre apparel, man-made fibre fabrics and technical textile products.

¦ The government allocated an outlay of H1,480 crore for the National Technical Textiles Mission to promote and develop the technical textiles sector in India.

¦ The government implemented programmes like SAMARTH for capacity building in textile sector, National Handloom Development Programme, Raw Material Supply Scheme, National Handicraft Development Programme, Comprehensive handicrafts cluster development scheme, and Integrated Wool Development Programme, among others, to promote the indigenous textile sector.

India solar energy sector

In 2023-24, India achieved a remarkable milestone by increasing its renewable energy capacity to 18.48 GW, registering a growth of more than 21% compared to 15.27 GW in 2022-23.

However, industry experts suggest India could add at least 50 GW each year for the next six years for India to achieve its ambitious goal of 500 GW by 2030. Besides, the MNRE also targets bidding of nearly 50 GW of renewable energy projects per annum to meet its ambitious 500 GW target.

As on 31 March 2024, the country''s installed renewable energy capacity, excluding large hydropower projects, reached 143.64 GW. However, including the hydro projects, the total capacity for renewable energy in the country surged to an approximate 190 GW. To achieve the 500 GW target, India needs to add 310 GW within the next six years, an average of 50 GW per year.

Solar energy stands as the leader in the renewable energy sector, with a total installed capacity of 81.81 GW. India

installed 1.7 GW of rooftop solar capacity in 2023, the second highest annual installation in a calendar year for the country. Coming to solar rooftops, the segment''s cumulative capacity stood at 10.5 GW by the end of 2023.

The capacity addition increased by as much as 3.7% as many commercial and industrial consumers held off on new projects while waiting for solar module prices to stabilise. Lower module prices in 2024 are expected to have helped companies reduce their project costs.

The residential segment stood as the primary growth driver for solar rooftop additions for the calendar year, accounting for more than 50% of the capacity added. Moreover, the rooftop solar system costs declined 10% quarter-on-quarter and 21.6% year-on-year in Q4, 2023.

During the April 2023 to February 2024 period, the country''s cell and module imports stood at H41,920 crore, higher than H18,093 crore in 2023-24. This rise in imports during the financial year ending 31 March 2024, can be attributed to the relaxation in ALMM norms for a year.

India achieved a record-breaking annual installation of solar open access, making an addition of 3.2 GW in the calendar year 2023, a marginal rise from 3 GW installed from the previous year. An approximate 292 GW of solar capacity is expected to be deployed by 2030. This makes solar photovoltaic management crucial. The country''s solar capacity rise from 81.81 GW in 2024 to 292 GW in 2030 is expected to be followed by a six-fold rise in solar waste, increasing from 1,00,000 tonnes in 2024 to 600,000 tonnes in 2030.

(Source: MNRE, Ornate Solar, ICRA, Live Mint, Mercom India, Economic Times)

Growth drivers

Environmental shift: A global shift is being witnessed from the conventional sources of energy to renewable sources on account of growing environment concerns and imperative for low carbon emissions. India''s increased focus on renewable energy, especially solar power, is expected to be a key driver for the sector and result in a rise in demand for solar power in the market.

Declining cost: A gradual decrease has been witnessed in the renewable energy prices in the country. Furthermore, the Indian government is providing tax incentives to users, minimising the installation costs, resulting in final cost reduction of solar energy. As a result, solar power

stands as a tough competitor to fossil fuels such as coal-based power in the country.

Robust investment: India received an investment of US$3.8 billion in foreign direct investment (FDI) in the solar energy sector over the past three financial years (FY21-FY23) and the first half of 2023-24. This rise in FDI showcases the trust of the investors in India''s solar energy sector, resulting in growth of solar power in the nation.

(Source: Economic Times, DataReportal, MNRE)

Policy support

¦ The Government of India allocated H12,850 crore to the Ministry of New and Renewable Energy as part of the Union Budget 2024-25 as against H10,222 crore in the previous year.

¦ Budgetary estimates for the central sector scheme on grid-based solar power have increased more than 2x from its revised estimates of nearly H4,757 crore in 2023-24 to H10,000 crore in 2024-25.

¦ The rooftop solar programme of the central government will enable 10 million households to obtain upto 300 units of free electricity every month. This initiative is expected to save households upto H15,000-H18,000 annually, both from free solar electricity and selling surplus energy to distribution companies.

¦ Organising skill development programmes to build a proficient workforce capable of executing, operating and maintaining renewable energy projects.

¦ The Central government has implemented a number of measures for the promotion of solar energy. This includes waiving ISTS charges for renewable energy projects commissioned by 30 June 2025.

¦ A trajectory for renewable purchase obligation upto 2030 has been declared, and ultra-mega renewable energy parks have been established to provide land and transmission to renewable energy developers.

¦ Numerous groundbreaking schemes were launched by India for the solar energy sector, including PM-KUSUM, solar rooftops phase-II 12,000-MW CPSU scheme phase-II, and a production-linked incentive scheme for higher efficiency solar PV models over the past three years.

(Source: Economic Times, Downtoearth.org)

Financial overview

Analysis of the profit and loss statement

Revenues: Revenue from operations reported a reduction of 7.65% from H1,647 crores in 2022-23 to H1,521 crores in 2023-24. Other income of the Company accounted for 0.71% share of the Company''s revenues reflecting the Company''s dependence on its core business operations.

Expenses: Total expenses of the Company reduced 3.54% from H1,583 crores in 2022-23 to H1527 crores in 2023-24 due to lower production. Employee expenses accounting for 8.72% of the Company''s revenues and decreased by 4.85% from H140.34 crores in 2022-23 to H133.53 crores in 2023-24.

Analysis of the Balance Sheet Sources of funds

¦ The capital employed by the Company increased by 10.76% from H1,217 crore as on 31 March 2023 to H1,348 crore as on 31 March 2024.

¦ The net worth of the Company reduced from H772.90 crore as on 31 March 2023 to H755.67 crores as on 31 March 2024 owing to decrease in reserves and surpluses. The Company''s equity share capital remained at H17.28 crore (8.64 crore equity shares of H2/- each as compared to 1.73 crore equity shares of H10/- each in the previous year due to change in face value of shares from H10/- to H2/- during the year)

¦ Long-term debt of the Company increased to H207 crores as on 31 March 2024. The long-term debt-equity ratio of the Company stood at 0.27 in 2023-24 as compared to 0.21 in 2022-23.

¦ Finance costs of the Company increased from H22.33 crores in 2022-23 to H36.33 crores in 2023-24 following the increase in borrowings for expansion of capacities and also due to increase in working capital requirements. The Company''s interest cover stood at 2.72 in 2023-24 compared to 6.58 in 2022-23.

Applications of funds

Fixed assets (gross) of the Company increased by 20% from H881 crores as on 31 March 2023 to H1,061 crores as on 31 March 2024 due to addition of new units.

Other Non-Current Assets

Other non-Current Assets of the Company reduced from H73.38 crore as on 31 March 2023 to H26.09 crore as on 31 March 2024 due to conversion of capital advances to Fixed assets.

Working capital management

¦ Current assets of the Company increased from H634.23 crore as on 31 March 2023 to H684.88 crore as on 31 March 2024. The current and quick ratios of the Company stood at 1.33 and 0.34, respectively in 2023-24 compared to 1.51 and 0.46 respectively in 2022-23.

¦ Inventories including raw materials, work-inprogress and finished goods among others increased by 11.76% from H380.57 crore as on 31 March 2023 to H425.32 crore as on 31 March 2024. The inventory cycle days increased from 75 days of turnover equivalent in 2022-23 to 97 days of turnover equivalent in 2023-24.

¦ Trade receivables increased by 2.11% from H143.40 crore as on 31 March 2023 to H146.43 crore as on 31 March 2024. More than 99% of the receivables are considered good. The Company debtor turnover cycle is 33 days due to lower turnover during 2023-24 compared to 30 days in 2022-23.

¦ Cash and bank balances of the Company increased from H31.39 crore as on 31 March 2023 to H38.88 crore as on 31 March 2024.

¦ Loans and advances (other than capital advances) made by the Company decreased by 20% from H65 crore as on 31^st march 2023 to H52 crore as on 31^st march 2024 on account of recovery of Loans and advances.

Margins

The EBIDTA margin of the Company decreased by 245 basis points from 8.96% in FY2022-23 to 6.51% in FY 2023-24, while the net profit margin of the Company decreased by 317 basis points

Particulars	FY 2023-24	FY 2022-23
Debt-equity ratio	0.77	0.56
Return on equity (%)	0.33	7.28
Earnings per share (Rs) - Basic	0.29	6.34
Debtors Turnover (days)	33	30
Inventory Turnover (days)	97	75
Interest Coverage Ratio	2.72	6.58
Current Ratio	1.33	1.51
EBITDA Margin (%)	6.51	8.96
Net Profit Margin (%)	0.17	3.34

Internal financial control systems and their adequacy

The Company''s internal audit system has been continuously monitored and updated to ensure that assets are safeguarded, established regulations are complied with and pending issues are addressed promptly. The audit committee reviews reports presented by the internal auditors on a routine basis. The committee makes note of the audit observations and takes corrective actions wherever necessary. It maintains constant dialogue with statutory and internal auditors to ensure that internal control systems are operating effectively. Based on its evaluation (as provided under Section 177 of the Companies Act, 2013 and Clause 18 of SEBI Listing Regulations), the Audit Committee has concluded that as on 31^st March, 2024, the Internal Financial Controls were adequate and operating effectively.

M / s. Price Waterhouse & Co. Chartered Accountants LLP, the Statutory Auditors of the Company audited the financial statements included in this Annual Report and issued a report on the internal controls over financial reporting (as defined in Section 143 of the Companies Act, 2013).

Human resources

The Company believes that its dedicated and motivated employees are its greatest asset. The Company till now has offered competitive compensations, healthy work environment and the employee performances are recognized through a planned reward and recognition programme. The Company intends to develop a workplace where every employee can recognize and attain his or her true power. The Company motivates individuals to undertake voluntary projects apart from their scope of work that help them to learn and nurture creative thinking. The Company''s permanent employee strength stood at 1945 as on 31^st March, 2024

Cautionary statement

The statement made in this section describes the Company''s objectives, projections, expectation and estimations which may be ''forward looking statements'' within the meaning of applicable securities laws and regulations. Forward-looking statements are based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realised by the Company. Actual result could differ materially from those expressed in the statement or implied due to the influence of external factors which are beyond the control of the Company. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements on the basis of any subsequent development, information or events.

Fixed Deposits

During the year under review, your Company has accepted Rs1.59 crores as public deposits and repaid H1.74 crores upon maturity making the outstanding as on March 31, 2024 to H13.09 Crores. In this regard, it is further stated that:

a) There were no matured deposits lying unpaid or unclaimed at the end of the financial year i.e. March 31, 2024

b) There has been no default in repayment of deposits or payment of interest thereon during the year.

c) There are no deposits lying with the Company which are not in compliance with the requirements of Chapter V of the Companies Act 2013 (Act) and

d) As provided under the Act, the outstanding deposits accepted under the provisions of previous Act have been repaid and squared off fully.

T ransfer of Unpaid / Unclaimed Dividend and Shares to Investor Education and Protection Fund (IEPF)

As per the provisions of section 124 of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 and subsequent amendments thereto ("the Rules"), all shares in respect of which dividends have not been paid or claimed for seven consecutive years or more shall be transferred to Investor Education and Protection Fund (IEPF). In line with the aforesaid provisions, unclaimed dividends (interim and final) declared for the FY 2015-16 along with the underlying shares on which the dividend remained unclaimed for seven consecutive years have been transferred to IEPF during the year.

The List of shareholders whose dividends / shares have been transferred to IEPF is available on the website of the company at :

https://visaka.co/investors/iepf shares 2023 24

Banks and financial institutions

Your Company is prompt in making the payment of interest and repayment of loans to the financial institutions / banks. Banks and Financial Institutions continue their unstinted support in all aspects and the Board records its appreciation for the same.

Corporate social responsibility

Your Company, as a responsible Corporate Citizen has spent an amount of H266.18 Lakhs towards CSR activities as against minimum amount i.e., H261.55 Lakhs during the financial year 2023-24 under the CSR activities as contemplated under Schedule VII of the Companies Act, 2013 and CSR policy adopted by the Company.

A report on CSR activities as required under Rule 8 of the Companies (Corporate Social Responsibility) Rules, 2014 is enclosed as Annexure-2.

CSR policy of the Company may be accessed on the Company''s website.

Directors and Key Managerial Personnel

As on March 31, 2024, Smt. G. Saroja Vivekanand (DIN: 00012994) , Managing Director, Shri. G. Vamsi Krishna (DIN: 03544943), Joint Managing Director, Shri. J.PRao (DIN: 03575950), Whole-time Director, Shri. S.Shafiulla, President & CFO and Shri. Ramakanth Kunapuli, AVP & Company Secretary are Key Managerial personnel of the Company pursuant to the provisions of Section 2(51) and 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial personnel) Rules, 2014.

Shri.G. Vamsi Krishna, Joint Managing Director (DIN-03544943) is liable to retire by rotation at the ensuing annual general meeting and being eligible, offers himself for reappointment. Shri. G. Vamsi Krishna, Joint Managing Director is holding 6,08,650 Equity shares of H2/- (Rupees Two) each of the Company. He is a director on the Board of Atum Batteries Private Limited, Svaroshni Private Limited, Karido Private Limited, V-Solar roofings Private Limited, Visaka Green Private Limited, Atumobile Private Limited, Atum Life Private Limited.

The Independent Directors have submitted requisite declaration of independence, pursuant to Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as provided in sub-section (6) of Section 149 of the Companies Act, 2013 read with sub rule (1) and (2) of Rule 6 of Companies (Appointment and Qualification of Directors) Rules, 2014 as amended.

During the year under review, Shri. Gusti Jall Noria (DIN: 00015561) , Director ceased to be an Independent director upon completion of his term with effect from March 31, .2024.

Directors'' Responsibility Statement

Pursuant to Section 134(5) of the Companies Act, 2013, Directors of your Company state that:

a) In the preparation of the annual accounts for the financial year ended March 31, 2024, the applicable accounting standards have been followed along with proper explanation relating to material departures and the annual accounts have been prepared in compliance with the provisions of the Companies Act, 2013.

b) They have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the company for the said period.

c) 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.

d) They have prepared the annual accounts on a going concern basis.

e) They have laid down internal financial controls in the Company that are adequate and are operating effectively and

f) They have devised proper systems to ensure compliance with the provisions of all applicable laws and these are adequate and operating effectively.

Corporate Governance

Pursuant to the provisions of Chapter IV read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on Corporate Governance has been incorporated in the Annual Report for the information of the shareholders. A certificate issued by the Statutory Auditors of the Company regarding compliance with the conditions of Corporate Governance as stipulated under the said Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of this Report.

Statutory Auditors and Auditors'' Report

M / s. Price Waterhouse & Co., Chartered Accountants LLP (FRN 304026E / E300009), Hyderabad who were appointed as statutory auditors of the Company to hold the office from the conclusion of the 40^th annual general meeting till the conclusion of 45^th annual general meeting to be held in the year 2027 audited the books of the Company for the financial year 2023-24 and submitted their report(s) (both standalone and consolidated) and the said report(s); does not contain any modifications or adverse remarks.

Internal Auditors

The company has a full-time in-house and professionally competent internal audit team, which regularly monitors the effectiveness of the internal control systems. Internal Auditor reports to the Audit Committee and the Managing Director / Joint Managing Director about the adequacy and effectiveness of the internal control systems of the company as well as the periodical results of its review of the company''s operations as per an approved internal audit plan duly approved by the Audit Committee.

The recommendations of the internal audit teams on improvements in the operating procedures and control systems for strengthening the operating procedures are presented periodically to the Audit Committee.

During the financial year under review, Internal Auditors have not reported any matter under Section 143(12) of the Act, and therefore no details are required to be provided under section 134(3)(ca) of the Act.

Cost audit:

In terms of the Section 148(1) of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the Company is required to maintain cost records pertaining to building products division and textile products division.

M/s. Sagar & Associates, Cost Accountants (Firm Regn. No. 000118) Hyderabad, Practicing Cost Accountants were re-appointed as Cost Accountants of the Company for conducting the cost audit for the financial year 202324 at a remuneration of H1,65,000/- (exclusive of out-ofpocket expenses and applicable taxes) and the same was ratified by you at the 41^st Annual General Meeting of the Company.

The Board after considering the recommendations of its Audit Committee, reappointed the aforesaid firm as cost auditors for the financial year 2024-25 and appropriate resolution in this connection has been included in the notice convening the ensuing annual general meeting of the Company for ratification of remuneration of the Cost Auditors. Cost audit report for the financial year ended March 31, 2023, was filed with the Central Government on August 31, 2023. Cost auditors have certified that their appointment is with in the limits prescribed under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified to undertake the Cost Audit assignment with in the provisions of the Act.

During the year under review Cost Auditors have not reported any matter under Section 143(12) of the Act, and therefore no details are required to be provided under section 134(3)(ca) of the Act.

Secretarial audit:

Your Board has appointed M/s. GMR & Associates, Practicing Company Secretaries, (Membership No. 8463 & CP No. 7911) Hyderabad as Secretarial Auditors of the Company for the financial year 2023-24 to conduct secretarial audit.

The Secretarial Auditor M / s. GMR & Associates, Hyderabad appointed by the Board conducted the secretarial audit and issued report in FORM MR-3 which is enclosed as Annexure-3.

In accordance with the SEBI Circular dated February 8, 2019 and additional affirmations required under Circulars issued by NSE and BSE dated March 16, 2023 and April 10, 2023 read with Regulation 24A of the SEBI Listing Regulations, the Company has obtained an Annual Secretarial Compliance Report from M / s. GMR & Associates, Practising Company Secretaries, confirming compliances with all applicable SEBI Regulations, Circulars and Guidelines for the year ended March 31, 2024.

M / s. GMR & Associates, Practising Company Secretaries, Hyderabad has issued a certificate confirming that none of the Directors on the Board of the Company has been debarred or disqualified from being appointed or continuing as Directors of companies by SEBI / MCA

or any such statutory authority. The said Certificate is annexed to the Report on Corporate Governance

The report of the Secretarial Auditors for the financial year 2023-24 is a clean report and does not contain any qualifications or adverse remarks.

During the year under review Secretarial Auditors have not reported any matter under Section 143(12) of the Act, and therefore no details are required to be provided under section134(3)(ca) of the Act.

Criteria for identification, appointment, remuneration and evaluation of performance of Directors

Your Company constituted Nomination and Remuneration Committee (hereinafter referred to as "the NRC Committee"), to oversee, inter-alia, matters relating to:

a) Identify persons who are qualified to become directors and persons who can be appointed in senior management in accordance with the criteria laid down, recommend to the Board their appointment and removal.

b) Formulate the criteria for determining qualifications, positive attributes and independence of director(s).

c) Recommend to the Board a policy relating to the remuneration for the directors, key managerial personnel and other senior management employees.

d) Carry out evaluation of every director''s performance including that of Independent Directors and

e) Devise a policy to be followed for identification, appointment, remuneration and evaluation of performance of directors including Company''s Board diversity etc., as approved by the Board.

The criteria for appointment, qualifications and positive attributes along with remuneration policy as applicable to Directors, KMPs and other Senior management personnel and the criteria to be followed for performance evaluation of each director including Independent Directors of the Company is enclosed as Annexure-4.

Formal annual evaluation made by the Board of its own performance, its committees and of individual directors.

Your Company believes that it is the collective effectiveness of the Board that impacts the Company''s performance and thus the primary evaluation platform is that of collective performance of the Board.

The parameters for evaluation of Board''s performance, as laid under evaluation criteria adopted by the Company,

have been derived from the Board''s core role of trusteeship to protect and enhance shareholder''s value as well as fulfil expectations of other stakeholders through strategic supervision of the Company.

The said criteria also contemplate evaluation of Directors based on their performance as directors apart from their specific role as independent, non-executive and executive directors as mentioned below:

a. Every director will be evaluated on discharging their duties and responsibilities as enshrined under various statutes and regulatory facet, participation in discussions and deliberations in achieving an optimum balance between the interest of company''s business and its stakeholders.

b. Executive Directors will also be evaluated based on targets / criteria given to Executive Directors by the Board from time to time in addition to their terms of appointment.

c. Independent Directors will also be evaluated on discharging their obligations in connection with their independence criteria as well as adherence with the requirements of professional conduct, roles, functions, and duties, specifically applicable to Independent Directors as contained in Schedule IV to the Companies Act, 2013.

The criteria also specifies that the Board would evaluate each committee''s performance based on the mandate on which the committee has been constituted and the contributions made by each member of the said committee in effective discharge of the responsibilities.

The Board of Directors of your Company has made annual evaluation of its performance, its committees and directors for the financial year 2023-24 based on aforesaid criteria.

Particulars of loans, guarantees or investments.

Details of investments made by the Company, are given in the notes to the financial statements (Please refer Note Nos. 5 & 6.1). During the year under review, your Company did not give or provide any other loans or guarantees, security or made any investments as covered under Section 186 of the Companies Act, 2013, other than as disclosed above.

Related party transactions

Related party transactions entered during the financial year under review are disclosed in the note no. 41 of notes to the financial statements of the Company for the financial year ended March 31, 2024. These transactions were entered at an arm''s length basis and in the ordinary course of business.

There were no materially significant related party transactions with the Company''s promoters, directors, management, or their relatives, which could have had a potential conflict with the interests of the Company. Statement in Form AOC-2, containing details of aforesaid related party transactions is enclosed as Annexure-5.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company''s website at https://visaka.co/assets/website/files/investors/Related-Party-Transactions-Policy.pdf

Risk Management

The Company has established enterprise Risk Management process to manage risks with the objective of maximizing shareholders value.

The Board of Directors of the Company has formed a Risk Management Committee to implement and monitor the risk management Policy of the Company. During the year under review, Risk Management Committee and the Board have periodically reviewed various elements of the risks and steps that were taken to mitigate the same. The development and implementation of the risk management policy has been covered in the Management Discussion and Analysis, which forms part of this report.

Other disclosures Board Meetings:

During the year under review, the Board met seven times i.e., on April 1, 2023, May 19,2023, May 26,2023, August 9, 2023, November 7,2023, February 12, 2024, and March 30, 2024.Details viz., members of the Board and their attendance etc., are given in report on Corporate Governance which forms part of this Annual Report.

Audit Committee:

As on March 31, 2024, the Audit Committee comprises of four directors i.e., three Independent Directors viz., Smt. Vanitha Datla (Chairperson), Shri Gusti J. Noria, Shri P. Srikar Reddy and Smt. G Saroja Vivekanand, Managing Director as members. All the recommendations made by the Audit Committee were accepted by the Board.

The Chairperson of the Audit Committee has attended 41^st Annual General Meeting.

Compliance with Secretarial Standards

The Company has complied with applicable provisions of the Secretarial Standards issued by the Institute of Company Secretaries of India and approved by the Government of India under Section 118(10) of the Companies Act, 2013.

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

Information required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is enclosed herewith as Annexure-6.

Annual Return

As required under Section 92(3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Amendment Rules, 2020, Annual Return for the financial year 2023-24 is available on the Company''s website at https://visaka.co/assets/website/files/investors/Annual-Returns-MGT-2023-24.pdf

Remuneration of Directors, Key Managerial Personnel, Employees:

Statement showing disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed as Annexure-7. In terms of Section 197(12) of the Companies Act, 2013, read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the top ten employees in terms of the remuneration drawn as set out in said rules forms part of this annual report. Considering the first proviso to Section 136(1) of the Companies Act, 2013, this annual report, excluding the aforesaid information, is being sent to the shareholders of the Company and others entitled thereto. The said information is available for inspection at the corporate office of the Company during business hours on working days of the Company upto the date of the ensuing annual general meeting. Any shareholder interested in obtaining a copy thereof, may write to the Company Secretary in this regard.

Business Responsibility and Sustainability Report

Pursuant to Regulation 34(2)(f) of the SEBI Listing Regulations, "Business Responsibility and Sustainability Report (BRSR)" of the company for the financial year ended March 31, 2024 forms part of this Annual Report and annexed as Annexure-8

Vigil Mechanism:

In accordance with the provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, the Company established a Vigil Mechanism to report genuine concerns

by all its stakeholders. The Audit Committee of the Board periodically reviews the complaints received if any under the policy.

The Whistle Blower Policy has been uploaded on the website of the Company.

General:

Your directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

i. Issue of equity shares with differential rights as to dividend, voting or otherwise.

ii. Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

iii. No significant or material orders were passed by any regulator or Court or Tribunal which impacts the going concern status and Company''s operations in future.

iv. Details in respect of frauds reported by auditors under sub-section (12) of Section 143 other than those which are reportable to the Central Government

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

vi. The details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year.

vii. The details of difference between amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.

viii. There are no qualification, reservation or adverse remark or disclaimer made by the statutory auditors in their report and by the company secretary in practice in his secretarial audit report.

Your directors further state that:

a) The Company has complied with the provisions of constitution of internal complaints committee under the sexual harassment of women at workplace (Prevention, Prohibition and Redressal) Act, 2013 and

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

Acknowledgements:

Your directors would like to express their sincere appreciation for the assistance and co-operation received from the financial institutions, banks, government authorities, customers, vendors and members during the year under review. Your directors also wish to place on record their deep sense of appreciation for the committed services by the Company''s executives, staff and workers.

---

Mar 31, 2019

Dear Members,

The Directors are pleased to present the 37th Annual Report of the Company with Audited Financial Statement for the year ended March 31, 2019. The financial highlights are as follows:

Rs. in Lakhs

Particulars	2018-19	2017-18
Total Revenues	114845	104781
Profit before depreciation and Taxes	13570	13647
Profit before taxes	10035	10164
Provision for taxes (Including deferred tax)	3294	3508
Total Comprehensive Income	6724	6456
Dividend (including corporate dividend tax) *	1340	1147
Balance brought forward from previous year	11071	5761
Profit available for appropriation	16454	11071

*Dividend paid during the respective years.

Performance review and the state of company’s affairs:

The year under review, started on a positive note, but could not sustain towards the end, as the initial momentum in GDP for the first quarter, recorded at 8% gradually slowed down to 6.6% for the third quarter of FY 2018-19 due to weaker domestic and external demand. This growth may look respectable, but under-performance of manufacturing sector and creation of inadequate employment opportunities remained as concerns. Despite the increase in state’s spending and direct cash transfer to farmers, the rural economy is hit by falling prices for farm produce. Towards the end, the state spending also slowed down due to general elections.

Your company’s significant scale, broad geographical exposure focussing on value added applications coupled with cost control measures have helped it to register highest ever sales since inception during the financial year under review. Increase in prices of key raw materials, rupee depreciation coupled with initial losses incurred on two projects impacted the profitability and thus the profit for the year remained the same as that of last year, despite increased revenues.

The Company’s key performance indicators are as under:

Total revenues increased by 10% to Rs.1148 Crores from Rs.1048 Crores of previous year.

Cash Profit remained at the same level of Rs.136 Crores as that of previous year.

Net Profit increased by 3% to Rs.67 crores from Rs.65 crores of previous year.

The capital expenditure for 2018-19 was Rs.50 crores, maximum of which is in respect of new V-Boards plant at Jhajjar in Haryana and ATUM plant at Miryalguda in Telangana

There is no change of business during the year under review.

Fixed Deposits

During the year under review, your company has accepted Rs.2.42 Crores as public deposits and repaid Rs.3.91 Crores upon the maturity making the outstanding as on March 31, 2019 to Rs.14.71 Crores.

In this regard, it is further stated that:

a) There were no deposits lying unpaid or unclaimed at the end of the year i.e. 31.03.2019;

b) There has been no default in repayment of deposits or payment of interest thereon during the year;

c) There are no deposits lying with the Company which are not in compliance with the requirements of Chapter V of the Companies Act 2013 (Act) and

d) As provided under the Act the outstanding deposits accepted under the provisions of previous Act have been repaid and squared off, fully.

Unclaimed Dividend and Shares

Your company, in compliance with provisions of Section 125 of the Companies Act, 2013 together with relevant applicable rules and circulars issued thereunder from time to time by the Ministry of Corporate Affairs, New Delhi, transferred the following shares to the IEPF Authority in respect of which no claim of dividend has been made for seven consecutive years:

a) 1,04,861 shares - In terms of notification general circular no. 12/2017 dated 16.10.2017 for seven consecutive years preceding 07.09.2016 (later extended up to 31.10.2017);

b) 4,107 shares - dividend declared up to the financial year 2010-11

Further, in terms of the aforesaid provisions, consequent to expiry of 7 consecutive years’ period unclaimed amount pertaining to Final Dividend for the Year 2011-12 along with First and Second Interim Dividends for the year 2012-13 together with shares, if any, will be transferred to the said fund on or before August 8, 2019 and September 8, 2019 respectively.

Banks and Financial Institutions

Your Company is prompt in making the payment of interest and repayment of loans to the Financial Institutions / bank and interest on working capital to the banks.

Banks and Financial Institutions continue their unstinted support in all aspects and the Board records its appreciation for the same.

Corporate Social Responsibility

Your Company, as a responsible Corporate Citizen established Visaka Charitable Trust in the year 2000, a non-profit entity, to support initiatives that benefit the society at large. The Trust had been already undertaking various activities like provision of drinking water by digging bore wells, construction of irrigation tanks in remote villages, building of Class Rooms in Schools and Colleges, reimbursement of salaries of teachers and supply of class room furniture and conducting health camps.

Keeping in view the above, your Board, thought it would be appropriate to spend CSR expenditure as mandated under Section 135 of the Companies Act, 2013 either in part or full through the same trust i.e., Visaka Charitable Trust, objectives of which entail it to undertake the CSR activities as contemplated under Schedule VII of the Companies Act, 2013. Accordingly, your company has been undertaking various CSR initiatives in meeting the said statutory obligations through the trust.

A report on CSR activities as required under Rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014 is enclosed as Annexure - 1.

Your Board further undertakes to spend the amount towards the aforesaid identified CSR activities through the trust as per the CSR policy of the Company.

CSR policy of the Company may be accessed on the Company’s website at the link: www.visaka.co.

Directors and Key Managerial Personnel

Pursuant to your approval obtained under postal ballot mode, following directors were reappointed as Independent Directors of the company effective from April 1, 2019:

a) Shri Bhagirat B.Merchant for two years up to 31.03.2021,

b) Shri V.Pattabhi for two years up to 31.03.2021 and

c) Shri Gusti J. Noria for five years with effect from 01.04.2019 up to 31.03.2024.

All the Independent Directors have given declarations stating that for the financial year 2019-20, they meet the criteria of independence as contemplated under Section 149(6) read with Schedule IV to the Act as well as SEBI Listing Regulations 2015 and the same were taken on record by the Board in its meeting held on May 3, 2019.

In pursuance of Article 130(e) of Articles of Association of the Company, Shri G. Vamsi Krishna is liable to retire by rotation at the ensuing annual general meeting and being eligible, offers himself for reappointment.

You are aware that Smt. G. Saroja Vivekanand is appointed as the Managing Director of the company for a period of five years effective from 24.10.2014 and holds the said position upto 23.10.2019. Based on the recommendations of Nomination and Remuneration Committee, your Board recommends her appointment as the Managing Director of the company for a further period of five years effective from 24.10.2019.

The compensation payable to the Managing Director and Joint Managing Director in aggregate is more than 5% of the net profits of the company. Therefore, in terms of SEBI (LODR) Regulations the terms of remuneration payble to Managing Director from 1.4.2019 requires your approval by way of special resolution. Appropriate resolutions to aforesaid effect are included in the Notice calling the ensuing annual general meeting of the company for seeking your approval.

Directors’ Responsibility Statement

Pursuant to Section 134(5) of the Companies Act, 2013, Directors of your Company state that:

a) In the preparation of the annual accounts for the year ended March 31, 2019, the applicable accounting standards have been followed along with proper explanation relating to material departures and the annual accounts have been prepared in compliance with the provisions of the Companies Act, 2013;

b) They have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the company for the same period;

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

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

e) They have laid down internal financial controls in the company that are adequate and are operating effectively.

f) They have devised proper systems to ensure compliance with the provisions of all applicable laws and these are adequate and are operating effectively.

Corporate Governance

A report on Corporate Governance, along with a certificate of compliance from the Auditors forms part of this Report.

Auditors and auditors’ report

Statutory Audit:

In terms of provisions of the Companies Act, 2013, at the 35th Annual General Meeting (20.06.2017) of the Company M/s. Price Waterhouse & Co., Chartered Accountants LLP (FRN 304026E/E300009), Hyderabad, were appointed as statutory auditors of the company, to hold the office from the conclusion of the 35th Annual General Meeting till the conclusion of 40th Annual General Meeting to be held in the year 2023 subject to the ratification at every Annual General Meeting, based on their eligibility confirmation to the effect that their appointment, if made, would be within the prescribed limits under the Act and that they are not disqualified for reappointment.

You are aware that in terms of interim orders of the Securities Exchange Board of India’s (SEBI) dated January 10, 2018, Price Waterhouse network Audit firms were restricted to undertake statutory audit and other certification related work for listed companies and intermediaries registered with SEBI for a period of 2 years including imposition of a financial penalty. However, SEBI has clarified that said order will not impact audit assignments for the financial year 2017-18. PW network firms have preferred an appeal against the said orders before the Hon’ble Securities Appellate Tribunal (SAT) and Hon’ble Tribunal granted partial relief to PW network firms, allowing them to audit their existing clients till March 31, 2019 or until a new bench is formed, whichever is earlier. As the quorum in SAT was not complete for hearing the matter in this case, PW preferred an appeal before Hon’ble Supreme Court for extension of the period of interim relief as granted by SAT. The Hon’ble Supreme Court vide its order dated 7th December 2018, inter-alia, mentioned that the interim order that has been passed in these proceedings (by SAT) should continue to operate at least until March 31, 2019 or until the SAT is properly constituted and decides the appeal. SAT vide its order dated 4th April 2019 reserved its order and mentioned that interim order that has been passed earlier, will continue to operate till disposal of the appeals.

In terms of Companies (Amendment) Act, 2017, with effect from May 07, 2018, the requirement relating to ratification of statutory auditors at every annual general meeting is done away with.

Cost Audit:

In terms of the Section 148(1) of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014 the company is required to maintain cost records pertaining to building products division and textile products division and as stipulated cost records pertaining to the said divisions are maintained.

M/s. Sagar & Associates, Cost Accountants, Hyderabad were appointed as Cost Accountants of the Company for conducting the Cost Audit for the financial year 2018-19 at a remuneration of Rs.1,50,000/- (exclusive of out of pocket expenses and applicable taxes) and the same was ratified by you at the 36th Annual General Meeting of the Company.

Further, the Board after considering the recommendations of its Audit Committee, appointed the aforesaid firm as cost auditors for the financial year 2019-20 and appropriate resolutions in this connection seeking your approval, has been included in the notice calling ensuing Annual General Meeting of the Company. Cost audit report for the financial year ended March 31, 2018 was filed with the Central Government on August 30, 2018.

Secretarial Audit:

Your Board has appointed M/s. Tumuluru & Co., Practicing Company Secretaries, Hyderabad as Secretarial Auditors for the financial year 2018-19 and Secretarial Audit Report for the Financial Year ended March 31, 2019 is enclosed as Annexure-2.

Criteria for identification, appointment, remuneration and evaluation of performance of Directors

Your Company constituted Nomination and Remuneration Committee (hereinafter referred to as “the Committee”), to oversee, inter-alia, matters relating to:

a) Identify persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, recommend to the Board their appointment and removal;

b) Formulate the criteria for determining qualifications, positive attributes and independence of a director;

c) Recommend to the Board a policy relating to the remuneration for the directors, key managerial personnel and other employees;

d) Carry out evaluation of every director’s performance including that of Independent Directors and

e) Deviseapolicyon Board Diversity Criteria to be followed for identification, appointment, remuneration and evaluation of performance of directors including Company’s Board diversity etc., as approved by the Board, aids the committee in discharging aforesaid functions.

The criteria for appointment, qualifications and positive attributes along-with remuneration policy as applicable to Directors, KMPs and other Senior management personnel and criteria to be followed for performance evaluation of each director including Independent Directors of the Company is enclosed as Annexure - 3.

Formal annual evaluation made of the performance of the Board, its committees and of individual directors

Your Company believes that it is the collective effectiveness of the Board that impacts Company’s performance and thus, the primary evaluation platform is that of collective performance of the Board.

The parameters for Board performance evaluation, as laid under evaluation criteria adopted by the company, have been derived from the Board’s core role of trusteeship to protect and enhance shareholder value as well as fulfil expectations of other stakeholders through strategic supervision of the Company.

The said criteria also contemplate evaluation of Directors based on their performance as directors apart from their specific role as independent, non-executive and executive directors as mentioned below:

a. Every director will be evaluated on meeting their duties and responsibilities as enshrined under various statutes and regulatory facet, participation in discussions and deliberations in achieving an optimum balance between the interest of company’s business and its stakeholders.

b. Executive Directors, being evaluated as Directors as mentioned above, will also be evaluated based on targets / Criteria given to executive Directors by the board from time to time in addition to their terms of appointment.

c. Independent Directors, being evaluated as a Director, will also be evaluated on meeting their obligations connected with their independence criteria as well as adherence with the requirements of professional conduct, roles, functions and duties specifically applicable to Independent Directors as contained in Schedule IV to the Companies Act, 2013.

The criteria also specifies that the Board would evaluate each committee’s performance based on the mandate on which the committee has been constituted and the contributions made by each member of the said committee in effective discharge of the responsibilities of the said committee.

The Board of Directors of your Company has made annual evaluation of its performance, its committees and directors for the financial year 2018-19 based on afore stated criteria.

Copy of Annual Return

A copy of the annual return has been placed on the website of the company at www.visaka.co.

The details forming part of the extract of the Annual return in form MGT-9 is annexed herewith as Annexure - 7.

Particulars of Loans, Guarantees or Investments

Details of investments and inter corporate deposits made by the Company, are given in the notes to the Financial Statements (Please refer Note Nos. 5 and 11). During the year under review, your Company did not give any other loans or guarantees, provide any security or make any Investments as covered under Section 186 of the Companies Act, 2013, other than as disclosed above.

Related Party Transactions

Related party transactions entered during the financial year under review are disclosed in Notes to the Financial Statements of the company for the financial year ended March 31, 2019. These transactions entered were at an arm’s length basis and in the ordinary course of business.

There were no materially significant related party transactions with the Company’s Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Form AOC-2, containing the note on the aforesaid related party transactions is enclosed as Annexure-4.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company’s website under investor relations/listing compliances tab at www.visaka.co.

Risk Management Framework

As a diversified enterprise, your Company believes that, periodic review of various risks which have a bearing on the business and operations is vital to proactively manage uncertainty and changes in the internal and external environment so that it can limit negative impacts and capitalize on opportunities.

Risk management framework enables a systematic approach to risk identification, leverage on any opportunities and provides strategies to manage, transfer and avoid or minimize the impact of the risks and helps to ensure sustainable business growth with stability of affairs and operations of the Company.

Keeping the above in view, your Company’s risk management is embedded in the business processes. As a part of review of business and operations, your Board with the help of the management periodically reviews various risks associated with the business and products of the Company and considers appropriate risk mitigation process. However, there are certain risks which cannot be avoided but the impact can only be minimized. The risks and concerns associated with each segment of your company’s business are discussed while reviewing segment-wise Management and Discussion Analysis. The other risks that the management reviews also include:

a) Industry & Services Risk: this includes Economic risks like demand and supply chain, Profitability, Gestation period etc.; Services risk like infrastructure facilities; Market risk like consumer preferences and distribution channel etc.; Business dynamics like inflation/deflation etc.; Competition risks like cost effectiveness.

b) Management and Operational Risk: this includes Risks to Property; Clear and well-defined work process;

Changes in technology / up gradation; R&D Risks; Agency network Risks; Personnel & labour turnover Risk; Environmental and Pollution Control Regulations etc.; Locational benefits near metros.

c) Market Risk: this includes Raw Material rates; Quantities, quality, suppliers, lead time, interest rate risk and forex risk.

d) Political Risk: this includes Elections; War risk; Country/ Area Risk; Insurance risk like Fire, strikes, riots and civil commotion, marine risk, cargo risk etc.; Fiscal/Monetary Policy Risk including Taxation risk.

e) Credit Risk: this includes Creditworthiness; Risk in settlement of dues by clients and Provisions for doubtful and bad debts.

f) Liquidity Risk: this includes risks like financial solvency and liquidity; Borrowing limits, delays; Cash/Reserve management risks and Tax risks.

g) Disaster Risk: this includes Natural calamities like fires, floods, earthquakes etc.; Man made risk factors arising under the Factories Act, Mines Act etc.; Risk of failure of effective disaster Management plans formulated by the Company.

h) System Risk: this includes System capacities; System reliability; Obsolescence risk; Data Integrity risk & Coordination and Interface risk.

i) Legal Risk: this includes Contract risk; Contractual liability; Frauds; Judicial Risk and Insurance risk.

j) Government Policy: This includes Exemptions, import licenses, income tax and sales tax holidays, subsidies, tax benefits etc. Further your Board has constituted a Risk Management Committee, inter-alia, to monitor and review the risk management framework.

Other Disclosures

Board Meetings:

Five meetings of the Board of Directors were held during the year. For further details, please refer report on Corporate Governance on page no. 77 of this Annual Report.

Audit Committee:

The Audit Committee comprises Independent Directors namely Shri Bhagirat B Merchant (Chairman), Shri V.Pattabhi and Shri Gusti J. Noria apart from Smt. G. Saroja Vivekanand, Managing Director. All the recommendations made by the Audit Committee were accepted by the Board.

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

Information required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is enclosed herewith as Annexure-5.

Vigil Mechanism:

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013 and Regulation 22 of SEBI Listing Regulation 2015 a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company under investor relations/listing compliances tab at www.visaka.co

Remuneration of Directors, Key Managerial Personnel, Employees and General:

Statement showing disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed as Annexure-6. In terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the top ten employees in terms of the remuneration drawn as set out in said rules forms part of the annual report. Considering the first proviso to Section 136(1) of the Companies Act, 2013 this annual report, excluding the aforesaid information, is being sent to the shareholders of the Company and others entitled thereto. The said information is available for inspection at the registered office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. Any shareholder interested in obtaining a copy thereof, may write to the Company Secretary in this regard.

General:

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

i. Issue of equity shares with differential rights as to dividend, voting or otherwise;

ii. Issue of shares (including sweat equity shares) to employees of the Company under any scheme;

iii. The Company did not have any subsidiaries and hence receipt of remuneration from such companies by directors did not arise.

iv. No significant or material orders were passed by any Regulator or Court or Tribunal which impacts the going concern status and Company’s operations in future.

Your Directors further state that:

a) The company has complied with the provisions of constitution of internal complaints committee under the sexual harassment of women at work place (prevention, prohibition and redressal) Act, 2013 and

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

Acknowledgements

Your Directors would like to express their sincere appreciation for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the Company’s executives, staff and workers.

On behalf of the Board of Directors

Date: May 3, 2019 Bhagirat B. Merchant

Place: Secunderabad Chairman

---

Mar 31, 2018

Boards’ Report

The Directors are pleased to present the 36th Annual Report of the Company with Audited Financial Statement for the year ended March 31, 2018. The financial highlights are as follows:

_ (Rs, in Lakhs)

Particulars	2017-18	2016-17
Total Revenues	104.781	106127
Profit before depreciation and Taxes	13647	10330
Profit before taxes	10164.	6922
Provision for taxes (Including deferred tax)	3508	2644
Total Comprehensive Income	6456	4115
Dividend (including corporate dividend tax)*	1147	382
Balance brought forward from previous year	5761	2029
Profit available for appropriation	11071	5761

♦Dividend paid during the respective years.

Performance review and the state of company’s affairs

The year under review was marked by various structural reforms. The turbulence of sudden note ban coupled with indirect tax overhaul resulted to a three-year low growth rate of 5.7% in the first quarter, however, towards end of the year it had shown signs of picking up, though lower than that of last financial year.

Initial teething problems associated with the adoption of new indirect tax regime in the form of GST, other structural reforms like initiating significant steps towards resolution of NPA problems, introduction of RERA etc., together with increase in crude oil prices world over have slowed down the growth. However, growth is picking up and the rural sector is showing signs of recovery.

Your company’s significant scale, broad geographical exposure focussing on value added applications coupled with cost control measures have helped it to register a decent growth in the profits of the company during the financial year under review.

The Company’s key performance indicators are as under:

- Revenue from operations decreased marginally by 1% to Rs,1048 Crores from Rs,io6i Crores of previous year.

- Cash Profit increased by 32% to Rs,136 Crores from Rs,103 Crores of previous year.

- Net Profit increased by 56% to Rs,67 crores from Rs,43 crores of previous year.

- The capital expenditure for 2017-18 was Rs,106.00 Crores, which was principally on account of setting up new V-Boards plant at Jhajjar in Haryana and new ATUM plant at Miryalguda in Telangana state. There is no change of business during the year under review.

Your Company’s shares are listed on the National Stock Exchange (NSE) and BSE Limited. Variations in the market capitalization and price earnings ratio are provided hereunder:

(Rs, in Crores except for ratio)

Parameter	As at March 31,2018	As at March 31,2017
Market Capitalization	1031.39*	4.30.05**
P/E ratio	15.50	10.05

♦based on closing price at BSE Limited, being the higher of two exchanges

**based on closing price at National Stock Exchange of India Limited, being the higher of two exchanges

Your Company made its initial public offer of equity shares in 1984.-85. The closing price (quoted on stock exchanges) of your Company’s share of Rs,io/- each fully paid-up as at March 31, 2018 and March 31, 2017 are 324.7% and 1354.% respectively over the price of last public offer made in the year 1991-92.

No material changes and commitments occurred after the close of the year till the date of this Report, which affect the financial position of the Company.

Dividend

Your Directors recommend payment of Final Dividend of Rs,7 (i.e. 70%) per share of Rs,1o/- each for the current Financial Year (previous year Rs,6/- per share (i.e. 60%)). The Company is absorbing Corporate Dividend Tax of Rs,228.51 Lakhs on the said Dividend.

Management Discussion and Analysis Global economic overview

In 2017, a decade after the global economy spiraled into a meltdown, a revival in the global economy became visible. Consider the realities: Every major economy expanded and a growth wave created jobs. This reality was marked by ongoing Euro-zone growth, modest growth in Japan, late revival in China and improving realities in Russia and Brazil leading to an estimated 3.7% growth in the global economy in 2017, a good 60 bps higher than the previous year.

Crude oil prices increased in 2017, the prices at the beginning of the year bring $54.-13 per barrel, declining to alow of $4.6.78 per barrel in June 2017 and closing the year at $61.02 per barrel, the highest since 2013.

Global economic growth for 6 years

Year	2014.	2015	2016	2017 (e)	2018 (f)	2019 (f)
Real GDP Growth (%)	3-5	3.2	3-1	3-7	3-9	3.0

[Source: World Economic Outlook, January 2018] e: estimated f: forecasted

A review of the growth rates of various national economies is provided below:

The US: The world’s largest economy entered its ninth straight year of growth in 2017 (2.3% compared to 1.6% in 2016) catalysed by the spillover arising out of government spending by the previous administration coupled with US$1.5 trillion worth of tax cuts stimulating investments.

Euro zone: This region experienced the upside arising out of cheap money provided by the central bank In 2017, Euro zone is estimated to grow 2.4% compared with 1.8% in 2016, the broad-based growth visible in all Euro-zone economies and sectors. (Source: WEO January 2018, focus economics).

China: The Chinese economy grew faster than expected in the fourth quarter (October to December) of 2017 at 6.8%, aided by a recovery in exports. For the full year, China’s growth is estimated at 6.9% which is its highest economic growth since 2010 and this growth easily beat the the nation’s slowest growth of 6.7% in 2016 (weakest pace in 26 years). In 2018, China’s growth is projected at 6.6%. (Source: WEO, NBS data)

Emerging Asia: Emerging Asia GDP is estimated at 6.5% in 2017. The region is being transformed by technologies and Internet, strengthening the digital economy. The region is being driven by infrastructure spending and stable economies. (Source: World Bank Global Economics Prospects)

GCC: Being highly oil dependent economies, GCC countries were affected by the oil price decline (60% since 2013), resulting in macro-economic instability that affected job creation and growth. The GDP growth across the region remained subdued at 1.8% in 2017. (Source: World Bank)

Russia: The economy appeared to have exited a two-year recession that, thanks to the authorities’ effective policy response and existence of robust buffers, proved shallower than past downturns. In 2017, Russia was estimated to grow 1.9% following negative growth of 0.6% in 2016 (WEO) and a projected GDP growth of 1.8% in 2018. (Source: MOMR)

Brazil: In 2017, Brazil grew at 1.1% following a deceleration of 3.5% in 2016 boosted mainly by the agricultural sector which grew by 13%. According to IMF predictions, the nation is expected to clock a growth of 1.9% in 2018. (Source: Focus Economics, Rio Times)

Outlook

The outlook for advanced economies improved, notably for the Euro area, but in many countries inflation remained weak, indicating that slack was yet to be eliminated, and prospects for growth in GDP per capita were held back by weak productivity growth and rising old-age dependency ratios. Global growth forecasts for 2018 and 2019 were revised upward by 20 bps to 3.9%, reflecting improved momentum and impact of tax policy changes in the US. (Source: WEO, IMF)

Indian economic overview

After registering GDP growth of over 7% for the third year in succession in 2016-17, the Indian economy is headed for somewhat slower growth, estimated to be 6.6% in 2017-18. Even with this lower growth for 2017-18, GDP growth averaged 7.3% for the period from 2014.-15 to 2017-18, the highest among the major economies, and achieved through lower inflation, improved current account balance and reduction in fiscal deficit to GDP.

The year under review was marked by various structural reforms by the Government and after remaining in negative territory for a couple of years, export growth rebounded during 2016-17 and strengthened in 2017-18; foreign exchange reserves rose to US$ 4.14. billion as on January 2018. (Source: CSO, economic survey 2017-18)

Key government initiatives

Bank recapitalization scheme: The Central Government announced capital infusion of Rs,2.i lac crore in public sector banks. The measure entailed a budgetary allocation of Rs,76,000 crore by the Central Government, while the remaining amount is to be raised by the sale of recapitalization bonds. (Source: KPMG)

Expanding road network: The Government of India announced a Rs,6.9 lac crore investment outlay to construct 83,677 kilometres of road network, over a period of five years. The ambitious programme is expected to generate 14..2 crore man-day jobs for the country and boost road infrastructure. (Source: KPMG)

Improving business ecosystem: The country was ranked at the hundredth position, an improvement of 30 places in the World Bank’s Ease of Doing Business 2017 report, a result of the Central Government’s pro-reform agenda. In addition, Aadhaar-based identification approach could streamline the regulatory regime. (Source: KPMG)

Goods and Services Tax: The Government of India carried out a significant overhaul of the indirect tax regime and launched the GST in July 2017, with the vision of creating a unified market. Under this regime, various goods and services would be taxed as per five slabs (28%, 18%, 12%, 5% and zero tax). Post-GST implementation a 50% increase was recorded in unique indirect taxpayers. (Source: KPMG)

Foreign Direct Investment: The ability to attract large scale Foreign Direct Investment (FDI) into India has been a key driver for policy making by the Government. Foreign direct investment into India steadily increased from approximately USD 24 billion in FY2012 to approximately USD 60 billion in FY2017, which was an all-time high.

Coal mining opened for private sector: Ending state monopoly, the government has opened coal mining to the private sector firms for commercial use. The move for energy security through assured coal supply is expected to attract major players, enhance sectoral efficiency, widen competition, increase competitiveness and induct the best technologies. (Source: The Hindu, Business Today)

Doubling farm incomes: To improve the living conditions of farmers, the government initiated a seven-point action plan to double incomes by 2022. (Source: PIB).

Outlook

World Bank projected India’s economic growth to accelerate to 7.3% in 2018-19 and 7.5% in 2019-20. Strong private consumption and services are expected to continue to support economic activity. Over the medium-term, GST introduction is expected to catalyse economic activity and fiscal sustainability. The recapitalization package for public sector banks announced by the Government of India is expected to resolve banking sector Balance Sheets, enhance credit to the private sector and spur investment. (Source: IMF, World Bank)

Global construction and building products industry overview

Global construction industry has been witnessing change, reflected in the growing demand for green construction products, lower carbon footprint and bridge lockup device systems to enhance the life of structures, building information systems for efficient building management and using fiber-reinforced composites for the rehabilitation of aging structures.

The market is primarily constituted by brick, stone, concrete and cement (including cement asbestos sheets used for roofing) in addition to wood, lumber, wood paneling and mill work products; the latest addition has been Fibre Cement Boards which can be used both in the interiors and exteriors of buildings. In the global construction industry, the residential segment is expected to remain the largest. Financing for residential construction projects is increasingly available with lower interest rates. (Sources: lucintel.com, IIFL)

Outlook

The global construction industry is forecast to grow at a CAGR of 4.2% from 2018 to 2023 and expected to reach an estimated $10.5 trillion by 2023. The future of the global construction industry appears favorable (opportunities in residential, non-residential and infrastructure). The residential segment is expected to report above-average growth during the forecast period. The Asia-Pacific region is expected to remain the largest market due to higher expenditure on infrastructure development and affordable housing projects. (Source: www.prnewswire.com)

- Asia Pacific is the fastest growing region and will dominate the global market with an estimated market value of about US$ 24. Bn by the end of 2025.

(Source: Time Metric, www.prnewswire.com)

Indian construction and building products industry overview

The November 2016 demonetization affected the Indian economy until the first quarter of 2017, moderating land prices. By April 2017, when the markets were appearing to stabilise, RERA and GST were announced in succession, which enhanced sectoral hesitation.

A segment of the Indian construction and building products industry reported healthy growth on the back of improving real estate dynamics. By 2028, India’s real estate market size is expected to increase sevenfold to US$ 853 billion from US$ 126 billion in 2015. The shortage of houses in urban and rural India is pegged at 18.78 million and 4.3.6 million, respectively. 20.2 million people reside in kuccha houses in rural areas and 65 million people live in houses without pucca roofs. The Government of India targeted to provide housing for all by 2022, catalyzing the building products industry (Source: IBEF, IIFL, Business Today).

Outlook

India’s construction industry is expected to grow at a CAGR of 4.16% until 2021, outperforming retrospective (2012 to 2016) growth of 3.95%. Huge sums are being invested in comprehensive construction projects - major infrastructure upgrades, sweeping residential housing programmes and wholesale city building. India is facing a large housing backlog - estimates claim as many as

30 million families need homes to try and tackle the ever-expanding need for affordable housing and the government plans to build 20 million low cost units by 2022. (Source: Timetric)

Governmental initiatives

Pradhan Mantri Awas Yojana (PMAY): The government, under Pradhan Mantri Awas Yojana (PMAY), an affordable housing initiative, has plans to provide homes to 20mn households in urban India and nearly 30mn in rural India. There is a shortage of about 6omn housing units currently

The impact of GST on the building materials sector

Unorganised players in the building material segment are largely non-tax compliant, resulting in a significant price gap between organized and unorganized players. For the past five years, the building material segment grew at 12% CAGR versus 10% for the industry. The reduction in GST rate 10% is likely to bridge the price gap and accelerate consumption shift from the unorganised to organised segment and stronger preference for branded products. (Source: IIFL)

— 20mn in urban areas and 4.0mn in rural areas. (Source: the hindu business line)

Government’s focus on doubling farmers’ income by

2022: Farmers’ household income has doubled every seven years in nominal terms, so the government’s target appears optimistic. Higher rural incomes will boost discretionary spending, thereby spurring stronger growth in the country. It is envisaged that rising income levels will spur housing demand. Being cost effective, cement asbestos sheets are expected to be the first alternative change choice and should pick up first with rural housing demand. (Source: Budget, 2018)

Budget allocation: In the Annual Budget 2018-19, the Government announced it would create a dedicated ‘Affordable Housing Fund’ in collaboration with the National Housing Bank (NHB), another step towards its ‘Housing for All’ ambition by 2022. (Source: Economic Times)

National Health Protection Scheme: In the 2018 Union Budget, the Finance Minister presented the National Health Protection Scheme which aims to cover over 10 crore poor and vulnerable families (or around 50 crore people). Under this program healthcare and wellness infrastructure worth Rs. 1200 crore would be needed for treatment of non-communicable diseases and to provide maternal, child health and diagnostic services. (Source: TOI)

SWOT analysis / Building products and construction industry Strengths

- High demand of commercial buildings and private sector housing

- Governmental push on the nation’s infrastructure sector

- Easy availability of raw materials

- Availability of low-cost labor

- Increased inflow of FDI

Weaknesses

- High logistics costs between service providers and customers

- Labor up - skilling

- High competition

- Lack of defined efficient and defined operating procedures

- The need for large capital

Opportunities

- Stable growth of the private housing sector

- Opportunities for PPP projects

- Increasing disposable incomes

- Ease in loan availability

- The sector provides numerous employment opportunities

- Reducing rural inflation

Threats

- Safety issues

- Natural calamities

Visaka’s standpoint

Visaka’s building products business manufactures two

products - cement asbestos sheets and fibre cement

boards (V-Boards and V-Panels).

- Cement asbestos sheets: There was a 2% growth in the volumes of the Company’s cement asbestos products in FY18. Cement asbestos sheets contributed to the Company’s overall revenues by 68%. Margins also improved significantly by 4.00 basis points in the year under review. With increasing government focus on housing and bettering rural infrastructure by promoting pucca roofing, the cement asbestos division is expected to do well in the foreseeable future.

- Fiber cement boards &panels (V-Next products): The

Company’s fiber cement products business (V-Next products) achieved an 8 % growth in volumes in FY18 backed by a robust domestic growth of 14. %. The contribution of fiber cement boards & Panels to the Company’s overall revenues was 15 %. The products from this division are currently only for the urban markets. With increasing awareness, the market for these products is expected to expand and have a wider outreach in the coming years.

- ATUM: The Company has launched a new solar roofing product called ATUM which is a first of its kind in the nation. It is eco-friendly, energy efficient and energy generating roof. The Company conducted pilot projects for this product in FY18. Full-fledged production is expected to commence in FY19.

Indian cement asbestos sector overview

Cement asbestos roofing sheets have been in use for 80

years in India, representing a convenient roofing product in rural and suburban India. 50% of the country’s rural population lives in kuccha or semi-pucca dwellings wherein this product represents a convenient fit due to its wide availability and low costs.

The roofing industry was valued at Rs,4.2,000 crore in 2017-18, expected to grow 6-8% based on GDP growth, rural incomes and abundant monsoons. The reduction in GST rate for roofing products from 28% to 18% has made cement asbestos sheets price-competitive compared to metal sheets still at the pre-GST level of 18%.

In India, almost 60% of rural folk use thatched roof/tiles for shelters. Since thatched roofs need regular replacement and tiled roofs need continued maintenance, whenever economic conditions improve, the preferred rural choice is to replace the existing roof with affordable and durable products i.e. cement asbestos sheets.

Outlook

With better monsoons, a decline in rural inflation and declining competition from the colour-coated steel sheets, following an increase in steel prices, reduction in the GST rate from 28% to 18%, the demand for cement asbestos sheets is expected to increase.

Properties such as fire-resistance, insulation against heat and sound, rust-proof, life of over 50 years and resistance to wear and tear (over plastic and steel) are expected to catalyze the off-take of cement asbestos sheets.

- Over 85% of asbestos production is used to manufacture products in Asia and Eastern Europe

- Top users of cement asbestos today include: o China

o Russia o India o Kazakhstan o Brazil

- Size of the cement asbestos sheets industry in India is about 4. Million Tonnes.

SWOT analysis of the cement asbestos industry Strengths

- Low cost

- Low maintenance

- Long-lasting products

- Fire and water-resistant

- Rust-Proof

Weaknesses

- Highly fragmented

- Low-value commodity

Opportunities

- Increasing demand for housing

- Increased governmental thrust upon low-cost housing

- Improvement in economic conditions in rural India

- Improved competitiveness--reduction in taxation from 28% to 18%

Threats

- Lack of entry barriers

Fibre cement boards and panels (V-Next products)

Fibre cement boards and panels enjoy advantages of dry construction products in their water resistance, termite resistance, acoustic and thermal insulation and diversified use. This is driving penetration in the Commercial, ilndustrial and residential segment (particularly wet areas), hotels and hospitals, colleges, auditoriums

There are six industry players producing similar products with an annual capacity of 5, 00,000 metric tonnes (92% of total industry). However, consumption of fibre cement boards is still low at 0.2 kilograms per person in India. The market was valued at Rs. 700 crore in FY17 and expected to reach Rs. 1,500 crore by FY 20. Sandwich panels are being preferred in use as partition material. The ‘reinforced building board sandwiched panels’ comprises two fibre-reinforced cement sheets enclosing a lightweight core and are cheaper compared to masonry /wood partitions, easier to fix and taking lower installation time.

Panels: Sandwich Panels are increasingly used as Partition Material. The ‘Reinforced Building Board Sandwiched Panels’ are made of two fibre-reinforced cement sheets enclosing a lightweight core. These panels are fully cured in the factory and ready to use. These panels are cheaper compared to masonry partitions / wood partitions and easy to fix and take lower installation time.

Australia	Thailand	USA	Vietnam	Indonesia	India
12.5	5	3-4-	1.1	0.6	0.2

SWOT analysis of fibre cement boards and panels industry Strengths

- Low-cost labour

- Low maintenance

- Fire, Water & Termite Resistant

- Quick installation

- Minimal competition

- Eco-Friendly green products

- High acoustic and thermal insulation properties

- Very good premium aesthetic appeal

Weaknesses

- Workability

- Slightly heavier

- Higher labour cost

Opportunities

- Rising need for housing facilities and warehouses

- High demand for shorter on-site labour cycles

- Rising urbanization

- Improvement in rural demand

- Need for more office space

- Increase in the number of hotels, hospitals, colleges, auditoriums

Threats

- None perceived currently Outlook

Fiber cement boards and panels are a substitute for plywood, gypsum boards and masonry. The size of the plywood industry is estimated at Rs,18,000 crore out of which Rs,5,4.00 crore is the size of the low-end plywood segment (100% unorganised). This is in addition to the vast size of gypsum board and conventional brick and mortar construction. These offer a good replacement opportunity for fibre cement boards.

Currently these boards are used only in metro cities and government projects but if worked well, there could be sizeable demand in tier II and III cities in the next few years. Due to the superior finishing and large variety of fibre cement products, their demand is slowly increasing. The market for fiber cement boards and panels is growing at a CAGR of 15% y-o-y. Growth is likely to be sustained/ increase on account of increasing adoption in a variety of applications.

Global textiles industry overview

The value of the global textile market was $667.5 billion in 2015 (83.1% fabrics and 16.9% yarns), up 1.5% over a year. The global textile mills market is forecast to reach $84.2.6 billion in value in 2020, an increase of 26.2% since 2015. ! China, India, Pakistan, Indonesia and Thailand are among leaders by installed capacity. [Source: shenglufashion. com, indiainfoline.com]

Indian textiles industry overview

The Indian textile industry was US$ 150 billion in July 2017. Textile and apparel exports from India are expected to increase to US$ 82 billion by 2021 from US$ 36.66 billion in FY17. India’s textiles industry contributes 10 per cent to the manufacturing production of India, account for 2 per cent of India’s GDP and employing more than 4.5 million people. The sector contributes 13 per cent to the export earnings of India. India is the second largest global producer of man-made fibre and filament with production of around 211 million kg in 2016 -17 .The central government plans to launch a new textile policy to achieve US$ 300 billion textile exports by 2024.-25 and create an additional 35 million jobs. [Source: IBEF]

Outlook

The Indian textile industry is projected to reach US$ 250 billion by 2019. India has the youngest population in the world with more than half below 35years, catalyzing textile demand growth.

Man - made yarns

The sector saw almost 9% per annum growth in the domestic market but exports stagnated during the last couple of years. Accumulated credit under GST from raw materials and capital goods investments affected industry growth. Though the production cost for man-made fibres sector was lower compared to China, India was not competitive due to taxes. The domestic man-made fiber industry mainly comprises of two components i.e., polyester and viscose, which together accounts for about 94% (in volume terms). Under this, polyester accounts for about 83% while viscose accounts for the remaining share.

India can potentially capture the international textile space vacated by China by focusing on man-made fibres. Synthetic textiles made from man-made fibres account for 70% of the world textile supply.

The domestic man-made yarn industry is on a revival path and is expected to improve going f 0 rward. With a downward revision of GST rates from 18% to 12% and an increase in import duties on various synthetic yarns and fibres, the domestic industry is expected to remain competitive vis-a-vis global players. (Source: fashionatingworld.com, CARE Ratings)

Outlook: The global share of man-made fibers is expected to grow further as the world cotton production is almost nearing its physical maximum and the MMF industry is expected to fulfill the incremental demand. In India as well, limited area under cultivation and erratic rain affects the cotton availability. Further the demand for man-made fibers from the technical textiles and home textile segment are expected to be major industry drivers.

The GST impact

The GST regime ushered several firsts. Cotton fibre, yarn and fabric which were not taxed, attracted 5% GST. Though silk and jute remained at 0%, synthetic fibre yarn was taxed at 18%. The high rates announced for yarn at 18% could lead to increased input costs, affecting the textile value chain. Hence GST tariff rate on synthetic yarn such as nylon, polyester, acrylic, etc. was reduced from 18% to 12% in October 2018. [Source: Outlook, Citi India]

Budgetary provisions benefiting India’s textile sector

Initiative: Allocated Rs,7,14.8 crore for the textiles sector.

Probable implication: Will promote exports and production in the labor-intensive sector.

Initiative: Allocated Rs,2,300 crore under Technology Up-gradation Fund Scheme (TUFS).

Probable implication: Encourage players to undertake capacity expansion.

Initiative: Allocated Rs,2,163.85 crore under Remission of State Levies (ROSL).

Probable implication: Will allow made-ups and apparel export backlog to be cleared; will release working capital.

Initiative: Proposed to channelise 12% of the new employees’ wages towards EPF over three years, extend fixed term employment and reduce women employees’ contribution to 8% for the first three years from 12% to increase their take home salaries.

Probable implication: Likely to boost hiring in the apparels segment; attract more women into the textile industry workforce.

Initiative: Allocated Rs,87.15 crore towards schemes for power loom units.

Probable implication: Should decentralise power loom industry across various clusters.

Initiative: Develop a national logistics portal as a single window online marketplace to link stakeholders.

Probable implication: Simplify marketing problems faced by MSME exporters; reduce transaction costs.

Visaka’s standpoint

Visaka manufactures niche, value added cotton touch air-jet spun polyester yarns and its products have among the highest margins in the synthetic yarn industry. Sales growth slowed for the Visaka’s yarn business in the first half of FY18 due to GST. The Company took a strategic decision to continue with the production which benefitted the Company when the sales growth picked up in the later part of FY18. The uniqueness and the superior quality of Visaka’s yarns helped the Company maintain steady revenues in FY18.

Operational performance

Building products: The net turnover of the Company from building products division improved to Rs,829 crore in FY18 as compared to Rs,777 crore in FY17 following improvement in the demand for V-Next products.

Yams: The yarns division clocked a turnover of Rs,169 crore in FY2017-18 as compared to Rs,174. crore in FY2016-17 due to effects of inverted rate structure under GST in the initial 6 months of implementation. This was since corrected by reducing the rate on yarns from 18% to 12% and situation is getting normalized.

Financial overview Sales and other income

Revenue during the year stood at Rs,1017 crore, increased by 5 % as compared to Rs,966 crore in FY17. The growth in sales was primarily driven by a surge in demand.

Interest and finance costs

The Company saw net interest and finance costs decrease by 7 % during the year due to better cashflow management and effective negotiation of interest rates.

Profit before tax

The Company registered a profit before tax of Rs,101. 64. crore compared to Rs,69.22 crore in the previous year an increase of 4.7%.

Profit after tax

The Company registered a profit after tax of Rs,66.56 crore compared to Rs,4.2.78 crore in the previous year, an increase of 56%.

Key ratios

Particulars	2017-18	2016-17
EBIDTA/Turnover (%)	15.51	12.93
EBIDTA/Net interest ratio	8.50	6.30
Debt-equity ratio	0.63	0.64.
Return on equity (%)	14-93	10.90
Book value per share (Rs,)	281.00	24.7.00
Earnings per share (Rs,)	41-91	26.94

Human resources and industrial relations

The Company believes that the quality of the employees is the key to its success and is committed to equip them with skills, enabling them to seamlessly evolve with ongoing technological advancements. During the year, the Company organised training programmes in different areas such as technical skills, behavioral skills, business excellence, general management, advanced management, leadership skills, customer orientation, safety, values and code of conduct. As on 31st March 2018 the Company’s employee strength stood at about 4.000.

Internal control systems and their adequacy

The Company’s internal audit system has been continuously monitored and updated to ensure that assets are safeguarded, established regulations are complied with and pending issues are addressed promptly. The audit committee reviews reports presented by the internal auditors on a routine basis. The committee makes note of the audit observations and takes corrective actions, if necessary. It maintains constant dialogue with statutory and internal auditors to ensure that internal control systems are operating effectively.

Cautionary statement |

The management discussion and analysis report containing your Company’s objectives, projections, estimates and expectation may constitute certain statements, which are forward looking within the meaning of applicable laws and regulations. The statements in this management discussion and analysis report could differ materially from those expressed or implied. Important factors that could make a difference to the Company’s operation include raw material availability and prices, cyclical demand and pricing in the Company’s principal markets, changes in the governmental regulations, tax regimes, forex markets, economic developments within India and the countries with which the Company conducts business and other incidental factors.

Fixed Deposits

During the year under review, your Company has accepted Rs,3.05 Crores as additional deposits from the public and shareholders thus making the outstanding as on March 31, 2018 to Rs,i6.20 Crores.

In this regard, it is further stated that:

a) there were no deposits lying unpaid or unclaimed at the end of the year i.e. 31.03.2018;

b) There has been no default in repayment of deposits or payment of interest thereon during the year;

c) There are no deposits lying with the Company which are not in compliance with the requirements of Chapter V of the Companies Act 2013 (Act) and

d) As provided under the Act the outstanding deposits accepted under the provisions of previous Act have been repaid and squared off, fully.

Unclaimed Dividend and Shares

Your company, in compliance with provisions of Section 125 of the Companies Act, 2013 together with relevant applicable rules and circulars issued there under from time to time by the Ministry of Corporate Affairs, New Delhi, transferred 1,04,861 shares in respect of which no claim of dividend has been made continuously for the seven years preceding 07.09.2016 (later extended upto 31.10.2017) to the IEPF Authority.

In terms of the aforesaid provisions, consequent to expiry of 7 years period:

a) unclaimed amounts pertaining to Final Dividend declared for the year 2009-10 and Interim Dividend declared in the year 2010-11 transferred to IEPF during the financial year under review and

b) unclaimed amount pertaining to Final Dividend for the Year 2010-11 together with shares, if any, will be transferred to the said fund on or before August 29, 2018.

Banks and Financial Institutions

Your Company has been prompt in making the payment of interest and repayment of loans to the Financial Institutions and interest on working capital to the banks. Banks and Financial Institutions continue to give their unstinted support. The Board records its appreciation for the same.

Corporate social responsibility

Your Company, as a responsible Corporate Citizen established Visaka Charitable Trust in the year 2000, a non-profit entity, to support initiatives that benefit the society at large. The Trust had been already undertaking various activities like provision of drinking water by digging bore wells, construction of irrigation tanks in remote villages, building of Class Rooms in Schools and Colleges, reimbursement of salaries of teachers and supply of class room furniture and conducting health camps.

Keeping in view the above, your Board, thought it appropriate to spend CSR expenditure as mandated under Section 135 of the Companies Act, 2013 either in part or full through the same trust i.e., Visaka Charitable Trust, objectives of which entail it to undertake the CSR activities as contemplated under Schedule VII of the Companies Act, 2013.

A report on CSR activities as required under Rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014. is enclosed as Annexure - 1. Your Board undertakes to spend the amount towards the aforesaid identified CSR activities through the trust as per the CSR policy of the Company. CSR policy of the Company may be accessed on the Company’s website at the link: www.visaka.co.

Directors and Key Managerial Personnel

Your board with profound grief takes note of sudden demise of Shri Nagam Krishna Rao, Director on 25.05.2017. Shri P.Abraham, resigned as a director of the company effective from 11.11.2017 due to his pre-occupations. The Board places on record its appreciation for the valuable contributions made by them during their association as directors of the company.

In pursuance of Article 130(e) of Articles of Association of the Company, Shri J.P.Rao, Whole-time Director is liable to retire by rotation at the ensuing annual general meeting and being eligible, offers himself for reappointment.

All the Independent Directors have given declarations stating that for the financial year 2018-19, they meet the criteria of independence as contemplated under Section 149(6) read with Schedule IV to the Act as well as SEBI Listing Regulations 2015 and the same was taken on record by the Board in its meeting held on May 7, 2018.

Shri J.P.Rao has been reappointed as Whole-time Director of the company effective from May 7, 2018 i.e., from the expiry of his present term of office, up to 20.05.2021. The said appointment is subject to your approval at the ensuing annual general meeting.

Directors’ Responsibility Statement

Pursuant to Section 134.(5) of the Companies Act, 2013, Directors of your Company state that:

a. in the preparation of the annual accounts for the year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures; the annual accounts have been prepared in compliance with the provisions of the Companies Act, 2013;

b. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the company for the same period;

c. the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

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

e. they have laid down internal financial controls in the company that are adequate and are operating effectively.

f. they have devised proper systems to ensure compliance with the provisions of all applicable laws and these are adequate and are operating effectively.

Corporate Governance

A report on Corporate Governance, along with a certificate of compliance from the Auditors forms part of this Report.

Auditors and auditors’ report Statutory Audit:

In terms of provisions of the Companies Act, 2013 to meet the requirements of rotation of auditors in the last Annual General Meeting M/s. Price Waterhouse & Co., Chartered

Accountants LLP (FRN 304.026E/E300009), Hyderabad, were appointed as statutory auditors of the company in the place of M/s. M. Anandam & Company, to hold the office till the conclusion of 4.0th Annual General Meeting to be held in the year 2023 subject to your ratification at every Annual General Meeting. The statutory auditors have confirmed their eligibility to the effect that their appointment, if made, would be within the prescribed limits under the Act and that they are not disqualified for reappointment.

You are aware that in terms of interim orders of the Securities Exchange Board of India’s (SEBI) dated January

10, 2018, Price Waterhouse network Audit firms were restricted to undertake statutory audit and other related certification work for listed companies and intermediaries registered with SEBI for a period of 2 years including imposition of a financial penalty. However, SEBI has clarified that said order will not impact audit assignments of financial year 2017-18. PW network firms have preferred an appeal against the said orders before the Hon’ble Securities Appellate Tribunal (SAT) and Hon’ble Tribunal granted partial relief to PW network firms, allowing them to audit their existing clients till March 31, 2019 or until a new bench is formed, whichever is earlier.

In terms of the said partial relief granted to PW network audit firms, your board after considering recommendations of Audit Committee, incorporated a suitable resolution recommending the ratification of appointment of M/s. Price Waterhouse & Co., Chartered Accountants LLP (FRN 304.026E/E300009), Hyderabad as statutory auditors for the financial year 2018-19, subject to outcome of SAT’s order, in the notice calling ensuing annual general meeting of the company for your consideration and in the eventuality that SAT passes order in the aforesaid matter, the same shall be complied with.

Cost Audit:

In terms of the Companies (Cost Records and Audit) Rules, 2014., under Companies Act, 2013, M/s. Sagar & Associates, Cost Accountants, Hyderabad were appointed as Cost Accountants of the Company for conducting the Cost Audit of Building Products Division as well as Textiles Products Division for the financial year 2017-18 at a remuneration of Rs,i,50,000/- (exclusive of out of pocket expenses and applicable taxes) and the same was ratified by you at the 35th Annual General Meeting of the Company.

Further, the Board after considering the recommendations of its Audit Committee, appointed the aforesaid firm as cost auditors for the financial year 2018-19 and appropriate resolutions in this connection seeking your approval, has been included in the notice calling ensuing Annual General Meeting of the Company. Cost audit report for the financial year ended March 31, 2017 was filed with the Central Government on September 9, 2017.

Secretarial Audit:

Your Board has appointed M/s Tumuluru & Co., Practicing Company Secretaries, Hyderabad as Secretarial Auditors for the financial year 2017-18 and Secretarial Audit Report for the Financial Year ended March 31, 2018 is enclosed as Annexure-2.

Criteria for identification, appointment, remuneration and evaluation of performane of directors

Your Company constituted Nomination and Remuneration Committee (hereinafter referred to as “the Committee”), to oversee, inter-alia, matters relating to:

a) identify persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, recommend to the Board their appointment and removal;

b) formulate the criteria for determining qualifications, positive attributes and independence of a director;

c) recommend to the Board a policy relating to the remuneration for the directors, key managerial personnel and other employees;

d) carry out evaluation of every director’s performance including that of Independent Directors and

e) devise a policy on Board Diversity

Criteria to be followed for identification, appointment, remuneration and evaluation of performance of directors including Company’s Board diversity etc., as approved by the Board, aids the committee in discharging aforesaid functions.

The criteria for appointment, qualifications and positive attributes along-with remuneration policy as applicable to Directors, KMPs and other Senior management personnel and criteria to be followed for performance evaluation of each director including Independent Directors of the Company is enclosed as Annexure - 3.

Formal annual evaluation made by the board of its own performance and of its committees and individual directors

Your Company believes that it is the collective effectiveness of the Board that impacts Company’s performance and thus, the primary evaluation platform is that of collective performance of the Board.

The parameters for Board performance evaluation, as laid under evaluation criteria adopted by the company, have been derived from the Board’s core role of trusteeship to protect and enhance shareholder value as well as fulfil expectations of other stakeholders through strategic supervision of the Company.

The said criteria also contemplate evaluation of Directors based on their performance as directors apart from their specific role as independent, non-executive and executive directors as mentioned below:

a. Executive Directors, being evaluated as Directors as mentioned above, will also be evaluated based on targets / Criteria given to executive Directors by the board from time to time as well as terms of their appointment.

b. Independent Directors, being evaluated as a Director, will also be evaluated on meeting their obligations connected with their independence criteria as well as adherence with the requirements of professional conduct, roles, functions and duties specifically applicable to Independent Directors as contained in Schedule IV to the Companies Act, 2013.

The criteria also specify that the Board would evaluate each committee’s performance based on the mandate on which the committee has been constituted and the contributions made by each member of the said committee in effective discharge of the responsibilities of the said committee.

The Board of Directors of your Company has made annual evaluation of its performance, its committees and directors for the financial year 2017-18 based on afore stated criteria.

Extract of Annual Return

The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-4..

Particulars of loans, Guarantees or Investments

Details of investments and inter corporate deposits made by the Company, are given in the notes to the Financial Statements (Please refer Note Nos. 5 and 11). During the year under review, your Company did not give any other loans or guarantees, provide any security or made any Investments as covered under Section 186 of the Companies Act, 2013, other than as disclosed above.

Related party Transactions

Related party transactions entered during the financial year under review are disclosed in Notes to the Financial Statements of the company for the financial year ended March 31, 2018. These transactions entered were at an arm’s length basis and in the ordinary course of business. There were no materially significant related party transactions with the Company’s Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Form AOC-2, containing the note on the aforesaid related party transactions is enclosed as Annexure-5.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company’s website under investor relations/listing compliances tab at www.visaka.co

Risk Management Framework

As a diversified enterprise, your Company believes that, periodic review of various risks which have a bearing on the business and operations is vital to proactively manage uncertainty and changes in the internal and external environment so that it can limit negative impacts and capitalize on opportunities.

Risk management framework enables a systematic approach to risk identification, leverage on any opportunities and provides strategies to manage, transfer and avoid or minimize the impact of the risks and helps to ensure sustainable business growth with stability of affairs and operations of the Company.

Keeping the above in view, your Company’s risk management is embedded in the business processes. As a part of review of business and operations, your Board with the help of the management periodically reviews various risks associated with the business and products of the Company and considers appropriate risk mitigation

process. However, there are certain risks which cannot be avoided but the impact can only be minimized. The risks and concerns associated with each segment of your company’s business are discussed while reviewing segment-wise Management and Discussion Analysis. The other risks that the management reviews also include:

a. Industry & Services Risk: this includes Economic risks like demand and supply chain, Profitability, Gestation period etc.; Services risk like infrastructure facilities; Market risk like consumer preferences and distribution channel etc.; Business dynamics like inflation/deflation etc.; Competition risks like cost effectiveness.

b. Management and Operational Risk: this includes Risks to Property; Clear and well-defined work process; Changes in technology / up gradation; R&D Risks; Agency network Risks; Personnel & labour turnover Risk; Environmental and Pollution Control Regulations etc.; Locational benefits near metros.

c. Market Risk: this includes Raw Material rates; Quantities, quality, suppliers, lead time, interest rate risk and forex risk

d. Political Risk: this includes Elections; War risk; | Country/Area Risk; Insurance risk like Fire, strikes, riots and civil commotion, marine risk, cargo risk etc.; Fiscal/Monetary Policy Risk including Taxation risk.

e. Credit Risk: this includes Creditworthiness; Risk in settlement of dues by clients and Provisions for doubtful and bad debts.

f. Liquidity Risk: this includes risks like Financial solvency and liquidity; Borrowing limits, delays; Cash/Reserve management risks and Tax risks.

g. Disaster Risk: this includes Natural calamities like fires, floods, earthquakes etc.; Man made risk factors arising under the Factories Act, Mines Act etc.; Risk of failure of effective disaster Management plans formulated by the Company.

h. System Risk: this includes System capacities; System reliability; Obsolescence risk; Data Integrity risk & Coordination and Interface risk.

i. Legal Risk: this includes Contract risk; Contractual liability; Frauds; Judicial Risk and Insurance risk.

j. Government Policy: This includes Exemptions, import licenses, income tax and sales tax holidays, subsidies, tax benefits etc. Further your Board has constituted a Risk Management Committee, inter-alia, to monitor and review the risk management framework

Other Disclosures Board Meeting

Five meetings of the Board of Directors were held during the year. For further details, please refer report on Corporate Governance on page no. 86 of this Annual Report.

Audit Committee

The Audit Committee comprises Independent Directors namely Shri B.B. Merchant (Chairman), Shri V.Pattabhi and Shri Gusti J. Noria apart from Smt. G. Saroja Vivekanand, Managing Director. All the recommendations made by the Audit Committee were accepted by the Board.

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

Information required under section 134.(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014., is enclosed herewith as Annexure-6.

Vigil Mechanism

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company under investor relations/ listing compliances tab at www.visaka.co

Remuneration of Directors, Key Managerial Personnel and Employees:

Statement showing disclosures pertainingto remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. is enclosed as Annexure-7. In terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014., a statement showing the names and other particulars of the employees drawing remuneration in excess of limits set out in said rules forms part of the annual report. Considering the first proviso to Section 136(1) of the Companies Act, 2013 this annual report, excluding the aforesaid information, is being sent to the shareholders of the Company and others entitled thereto. The said information is available for inspection at the registered office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. Any shareholder interested in obtaining a copy thereof, may write to the Company Secretary in this regard.

General:

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

i. Issue of equity shares with differential rights as to dividend, voting or otherwise;

ii. Issue of shares (including sweat equity shares) to employees of the Company under any scheme;

iii. The Company did not have any subsidiaries and hence receipt of remuneration from such companies by directors did not arise.

iv. No significant or material orders were passed by any Regulator or Court or Tribunal which impacts the going concern status and Company’s operations in future.

Your Directors further state that during the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Acknowledgements:

Your Directors would like to express their sincere appreciation for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the Company’s executives, staff and workers.

On behalf of the Board of Directors

Date: May 7, 2018 BHAGIRAT B. MERCHANT

Place: Secunderabad Chairman

---

Mar 31, 2017

The Directors are pleased to present the 35th Annual Report of the Company with Audited Financial Statement for the year ended March 31, 2017. The financial highlights are as follows:

(Rs. in Lakhs)

PARTICULARS	2016 - 2017	2015 - 2016
Total Revenues	97050	100758
Profit before depreciation and Taxes	10047	7668
Profit before taxes	6640	4037
Provision for taxes (Incl. Deferred Tax)	2559	1594
Profit for the year after taxes	4081	2443
Balance brought forward from previous year	1041	1054
Profit available for appropriation	5291	3497

PERFORMANCE REVIEW AND THE STATE OF COMPANY''S AFFAIRS

The year gone by has been challenging at times, exciting, stressful and overall, is a mixed bag for the rural and semi-urban economy of the country. There was a normal rainfall unlike for the past two years, lead to a spurt. But the severe cash crunch, an outcome of demonetization and digitization, took away the initial agility. Particularly, unorganised sector of the country, considered to be the back bone of rural economy, has been drastically effected and the initial momentum generated during the first half of the year got disturbed.

Amidst such an economic environment, having major influence on your company''s performance, strategies like aggressive ad campaign, improved operational efficiency, strengthening the Distribution reach, developing new markets and focusing more on high realization applications coupled with reconversions happening from metal sheets to Asbestos Cement Sheets etc., helped to show a good performance during the financial year under review.

The Company''s key performance indicators are as under:

- Revenue from operations decreased marginally by 3.8 per cent to H966 Crores from H1005 Crores of previous year.

- Cash Profit increased by 31 per cent to H100.47 Crores from 76.68 Crores of previous year.

- Net Profit increased by 67 per cent to H40.80 crores from H24.43 crores of previous year.

- The capital expenditure for 2016-17 was H67.03 Crores, which was principally on account of ongoing expansion undertaken at the Textile Plant at Nagpur and other normal capital expenditure at various units. There is no change of business during the year under review.

Your Company''s shares are listed on the National Stock Exchange (NSE) and BSE Limited. Variations in the market capitalization and price earnings ratio are provided hereunder:

	As at	As at
Parameter	March 31,	March 31,
	2017	2016
Market Capitalization (in Rs, Crores)	430.05*	168.02**
P/E ratio	10.54	6.87

*based on closing price at National Stock Exchange Limited, being the higher of two exchanges

** based on the closing price at BSE Ltd., being the higher of the two exchanges

Your Company made its initial public offer of equity shares in 1984-85. The closing price (quoted on stock exchanges) of your Company''s share of H10/- each fully paid-up as at March 31, 2017 and March 31, 2016, are 1354% and 529% respectively over the price of last public offer made in the year 1991-92.

No material changes and commitments occurred after the close of the year till the date of this Report, which affect the financial position of the Company.

DIVIDEND

Your Directors recommended payment of Final Dividend of H6/- (i.e. 60%) per share of H10/- each for the said financial year, as against H5/- per share (i.e. 50%) of previous year. The Company is absorbing Corporate Dividend Tax of H193.98 Lakhs on the said Dividend.

MANAGEMENT DISCUSSION AND ANALYSIS

Global economic overview:

Global economic growth picked up slightly and rose to 3.1% in 2016. It is expected to rise further to 3.4% in 2017 and 3.6% in 2018. The growth had gained momentum in the final quarter of 2016 on the back of gains in developed and emerging economies. The recovery of the global economic scenario is uneven as the developed nations are leading the upswing in the global growth with a favourable domestic demand aiding growth in the Euro area and the United States. The euro zone is benefitting from strong household spending and a decline in unemployment rates. While the US economy is growing due to gains in household wealth and a turnaround in investment as a result of a rebound in oil-drilling activity, in Japan, despite the slowed private consumption, the weakening of the yen and an improvement in the global scenario is accelerating economic activity.

China''s booming real estate market and stronger global growth are boosting manufacturing output and investment. Most Asian economies are benefitting from strengthening of global trade. Latin America''s growth remains sluggish due to vulnerabilities to external shocks and structural weaknesses. Despite this optimism, lot of events could threaten global economic growth:

- The Brexit process got triggered in 2017 and it will send European Union and the United Kingdom into unchartered waters.

- The right-wing populist Geert Wilders and his Party for Freedom (PVV) have been defeated in the elections in the Netherlands. The election of the new president for France is also expected to be a major highlight in 2017.

- The Federal Reserve recently made its second hike and it could lead to fuelling volatilities in the financial markets, particularly in the developing countries.

(Source: Focus Economics)

Indian economic overview:

India''s GDP growth has improved phenomenally in the past couple of years and is being hailed as a ''bright spot'' among the emerging economies. But it may soon lose its ''fastest-growing major economy'' title to China after winning it from China in the previous fiscal. This would be a result of a downward revision of India''s GDP by the IMF. India''s projected GDP growth of 7.6% has now been revised downward to 6.6% by the IMF. This downward revision had happened primarily due to the cash shortages, payment disruptions in the wake of the demonetization initiative. This is however expected to be a short-term effect which will strengthen the nation''s fundamental structure in the long run. However, this effect is expected to gradually dissipate during FY 2017-18. The quality of India''s fundamentals are expected to become stronger and economic growth is expected to rebound to 7.2% in FY 2018 with growing digitization, the implementation of the GST, favorable monsoons, lowered oil prices, removal of supply chain bottlenecks and a strong consumer confidence. The Indian Government''s decisive policy man oeuvres towards ensuring fiscal consolidation and pegging back inflation will help it maintain economic stability in the years to come. (Source: Hindustan Times, TGI, Livemint).

Segment Analysis A. Building Products:

Global construction and building products industry overview

Building products industry consists of various building materials such as brick, stone, concrete and cement in addition to wood, lumber, wood paneling and mill work products the latest addition being Fibre cement Boards. It also includes roofing materials such as glass and asbestos. The construction and building materials industry is often difficult to track due to its complete dependence on the building sector and its trends. A rise in urbanization and an expanding real estate industry along with an increase in the world population and economic growth has led to a considerable growth of this sector. It is predicted that the global industry in construction supplies will reach US $1.1 trillion by 2020. Certain challenges that are prevalent in the construction and building products sector are listed below:

- Demand cyclicality: Demands of products are not consistent and is affected by seasonality with summers witnessing major outdoor construction activities and thus increase in demands.

- Macroeconomic factors: Global GDP growth, which affects interest rates and cost of mortgage and loans, has an impact on the real estate trade and in turn the sale of construction materials.

- Consumer preferences: Changing consumer preferences can drastically affect the off take of construction materials.

Indian construction and building products industry overview:

The Indian real estate sector is one of the most globally recognized sectors and is expected to reach a market size of US$ 180 billion by 2020. This growth in the real estate sector will also drive the growth of the construction and building products segment in India. This market includes wood based products, plastic boards, metal roofs, tiles and fibre cement products. Out of these, fibre cement building product comprises about 20% of the market and is growing at a robust pace. It is also capturing market share from other products in the industry.

The Indian government is increasing thrust on rural development which is a major driver of the building products segment. And along with rising rural incomes and moderation in rural inflation, the scope of roofing products is very large. It is estimated that about 54% of houses in rural India are kutcha houses and this deficit in rural housing offers tremendous opportunity of sustained growth of new age construction practices as well as building products. (Source IBEF, HDFC Securities)

Governmental initiatives:

Nearly 70% of the Indian population stays in the rural area and thus rural development has been a major focus of the Government. The urban development and housing minister has set the target of providing pucca ''housing to all by 2022''. Besides rural development, homelessness in urban areas is also a major concern and despite India''s growing economic stature, the country has as many as 78 million homeless people. To tackle these problems, the government took initiatives towards housing and development which will also provide a boost to the construction and building products segments. Few of which are listed below:

- Pradhan Mantri Awaas Yojana: Under this scheme, financial assistance will be offered to the homeless for the development of pucca houses. Approximately 2 crore dwelling units are planned to be built and is expected to be completed by 2022.

- Rajiv Aavas Yojana: This is a low-cost housing scheme is for who unable to pay high money for own house. The scheme envisages a ''slum-free India'' where every citizen has access to basic civic infrastructure, social amenities and a decent shelter.

- Credit-linked subsidy scheme for middle income groups: Under this scheme, an interest subsidy of 4% will be provided on housing loans of up to H9 lac for people with an income of H12 lac per year and a 3% subsidy will be provided on loans up to H12 lac for those having an income of H18 lac per year. This will lower the EMIs on the housing loans taken by people in midi come groups by over H2,000 per month.

- Rural Housing Fund: This scheme will provide interest subsidy to every rural household who is not covered under the Pradhan Mantri Aawas Yojana (Grameen), PMAY (G), enabling people in rural areas to construct new houses or add to their existing pucca houses to improve their dwelling units. The beneficiary who takes a loan under the scheme would be provided interest subsidy for loan amount up to H2 lac.

(Source: Indian Express, Livemint, HDFC Securities, makaan.com)

SWOT analysis of the Indian construction and building products industry:

Strengths

- Abundant employment opportunities

- Demand for commercial buildings and private sector housing are on the rise

- Keen emphasis laid by the Indian Government on the infrastructure sector

- Abundant availability of raw materials and low-cost labour

- Increased FDI inflow

Weaknesses

- Large distances between construction projects

- Skilling of labour pool needed on an immediate basis

- Intensely competitive environment

- Lack of well-defined processes

- Capital-intensive industry

Opportunities

- Growth in the private housing sector

- PPP projects

- Rising incomes and easy availability of loans

- Ample employment opportunities

- Weakening rural inflation

- Promotion of FDI in the construction sector

- Good Monsoons

Threats

- Infrastructure safety

- Natural calamities

- Increasing shift towards alternative products Visaka''s standpoint

Visaka''s building products business manufactures two products - cement asbestos products and fibre cement boards (V-Boards and V-Panels).

Overview of Cement Asbestos Business:

Industry structure and developments:

This industry exists for the last 80 years in India. Cement Asbestos Products continue to be in demand because of the efforts made in making inroads into rural markets for the product, its affordability and other qualities such as corrosion resistance, weather and fire proof nature.

Currently there are about 20 entities in the Industry with about 53 manufacturing plants with an annual capacity of approximately 45.00 Lac MT throughout the Country. The products are marketed under their respective brand names mainly through dealers for the retail segment and directly for projects and government departments.

Opportunities and threats:

Cement asbestos sheets are mainly used as roofing materials in rural and semi-urban housing and by industries and poultry sector.

Cement asbestos sheets are popular as they are inexpensive, need no maintenance and last long when compared to competing products such as thatched roofs, tiled roofs and galvanized iron sheets.

According to the information gathered by the Company, about 60% of rural people use thatched roof/tiles for the shelter. Thatched roof need regular replacement and tiled roof needs continued maintenance. Therefore, whenever the economic conditions improve, the first choice of the rural poor is to replace the roof over their head with the affordable and relatively durable product i.e. Cement Asbestos Sheets and thus your Company sees increased potential for usage of Cement Asbestos Sheets in rural areas.

Presence of increased alternative products in the recent past like Galvam and other metal colour coated sheets is creating some impact on the sales volumes of this product to some extent.

Risks and concerns:

Lack of entry barriers: Lack of entry barriers is attracting new entrants into this line of business.

Activities of Ban Asbestos Lobby: The activities of the Ban

Asbestos Lobby instigated by the manufacturers of substitute products continue to be a matter of concern. Government of India along with Russian Government opposed the move to put any condition on this industry in the recent Rotterdam Convention held in Geneva. This proves that the Government is convinced about the product.

Outlook:

The Company is the second-largest cement asbestos sheet brand in the nation with a market share of 18%. The asbestos division''s profits grew by 198% in FY2016-17. The decrease in rural inflation and sales contraction of steel sheets are expected to catalyze the off take of asbestos products.

Your Company is continuously striving to enhance the product''s distribution reach and increased market presence by strengthening network of stockiest, resorting to aggressive advertisement campaign and capitalizing on company''s brand & image. These, coupled with inherent advantages associated with the product such as cost affordability etc., are expected to result in a growth rate of 5% to 10% in the next fiscal. The company effectively staved off the effect of demonetization to a large extent.

Overview of Fibre Cement Boards & Panels:

Industry structure and developments:

There are 6 players in the industry producing identical or similar products with an annual capacity of approximately 470000 MT.

Opportunities and threats:

Fibre Cement Boards (FCB) are environment friendly, save time, cost effective as well as a good substitute for wood and thus help in reducing deforestation. Further it can also be a substitute for gypsum board in certain applications. These products have good aesthetics appeal. They can be used both internally and externally. They are also durable and have a life of over 25 years or more with proper maintenance. Further, the product has Triple advantages of Fire, Water and Termite resistance. FCB suits itself to any type of finish - paint, laminate, wall paper, tiles, marble etc.

FCB products are well accepted in Office and Commercial Segments for partitions, seamless false ceiling and grid false ceilings etc. Wet Area application with the product has become an accepted norm and its ability to take the finish of Marble or Tiles is an added advantage. Industrial segment started using V-Boards for Mezzanine application and Double Skin partitions.

As far as the Residential Segment is concerned, the entry level is with False Ceiling Tiles in bathrooms. In living rooms and kitchens the product can be used as shelves and cupboards, because FCB does not get affected by Termite and it is a long-life product. External Cladding with V Premium Boards, Front Elevation with V Premium Planks and Duct Covering to service pipes are well appreciated & accepted by leading builders in India. Residential dwelling units with all internal walls made of FCB are catching up very fast.

Your company is working on a model to cater to the needs of affordable housing with innovative in-fill Technology called V-in-fill system under which external and internal walls are built with a great speed at competitive cost.

V Premium stands the test of time, when exposed to different weather conditions; High levels of Fire Resistance (up to 3 hrs fire rating) and Noise Reduction Levels (up to 55 dB) enables an entry of V Board, in to Hotel Segment. Star hotels like Marriott, Sahara etc., have started using the same for dry walls / room dividers. Increased awareness to FCB will help acceptance and market growth. Visaka is the only Company to have Green Certification from CII, for its Non Asbestos Fiber Cement Board Products.

On the negative side, Cellulose pulp must be imported. Compared to wood and plywood, workability is a matter of concern. Further, initial handling is comparatively difficult. While consumers are preferring this product, the applicators like Carpenters were resisting initially due to difficulty in working on FCB compared to Plywood. Your Company has overcome this problem in the last couple of years by educating the applicators, through theoretical and practical training programmes.

Risks and Concerns:

Lack of entry barriers as well as import of cement board materials from Philippines/Thailand/China and Malaysia are matters of concern. However, they are not competitively priced.

Outlook:

The industry is growing at an average rate of 20%. Your company''s fibre cement board products contributed 18.24% of the revenues of Visaka''s building product segment in FY 2016-17. It is planning to expand the capacity of V-Boards and V-Panels at an investment of H75 crore during the next year via a Greenfield expansion in Northern India to capitalize on the growing demand emanating from that region.

The markets for V-Boards and V-Panels had thus far been limited to urban centres. Visaka, through its strategic marketing initiatives has been able to raise awareness and foster nationwide acceptance for these products. Although, the Company''s current growth driver is the cement asbestos sheet segment, V-Boards and V-Panels are Visaka''s future.

Saudi Arabia and Middle East markets are slightly down due to drop in crude oil prices, which is a matter of concern. To offset the same, your Company is exploring opportunities in African countries like Tanzania, Kenya; focusing on other Asian countries like Nepal, Sri Lanka and Pakistan. Your Company has enquiries from Philippines and Europe also. As Plywood is turning out to be costlier, it is expected that consumers will shift towards Cement boards in a big way.

Panels

Sandwich Panels are in demand in the market, for use as Partition Material. The ''Reinforced Building Board Sandwiched Panels'' are made of two fibre-reinforced cement sheets enclosing a lightweight core. These panels are fully cured at factory and are ready for installation.

These panels are cheaper compared to masonry partitions / wood partitions and are also easy to fix and take comparatively lesser time for installation.

B. Spinning Division:

Global textiles industry overview:

Global textile fibre consumption was pegged at 85 million tonnes, growing at a rate of 3%. Sales of textiles and clothing sector also fell as a result of this by 1.5%. Asia dominated the primary textile production market as Vietnam almost caught up with China. Besides the slower economic growth, another factor that contributed to these sectors stunted growth was the challenging weather conditions which affected the agricultural sector in many countries. But post the bumpy growth of this sector in 2016, this industry expects a slight revival in 2017. Technical textiles are expected to be the next big trend in this sector and will see major investment opportunities in the years ahead. Overall, the global textile industry is expected to grow at a CAGR of 5% as globalization continues. (Source: eulerhermes, techtextil)

Indian textiles industry overview:

The textiles segment is one of the oldest sectors of India and is one of the major contributors to the nation''s exports, contributing to 11% of the total exports. The textile industry employs approximately 40 million workers directly and 60 million indirectly. The total worth of the Indian textile industry is estimated to be US$ 108 billion, which is estimated to reach US$ 223 by 2021The Indian textile sector is very diverse with hand-spun and hand-woven textiles sectors at one end of the spectrum and the capital intensive sophisticated mills sector at the other end. Also the close linkage of this sector with the nation''s agriculture sector makes it unique in comparison to similar sectors in other nations. The Indian textiles and apparel sector is divided into broadly two segments: yarns and fibres and processed fabrics and apparel. India accounts for about 14% of the world''s production of textile fibres and yarns. India''s loom capacity, including handlooms is the highest in the world, contributing to 63% of the world''s market share. The future of the Indian textile industry looks optimistic supported by strong domestic consumption as well as rising export demands. Rising consumerism and higher disposable incomes have provided a boost to this industry in the past decade, which has led to the entry of several international players in the market such as Marks & Spencer, Guess and Next into the Indian market. The expected growth of the organized apparel segment is to be at a CAGR of more than 13% over a 10 year period which will drive the growth of high quality yarn demand. (Source Linkedln, IBEF)

Governmental initiatives:

The Government of India and the Ministry of Textiles took several initiatives to strengthen the nation''s textile industry. Few of which are listed below:

- Encouraging entrepreneurs to invest by increasing allocation of funds to Mudra Bank from Rs,1,36,000 crore (US$ 20.4 billion) to Rs,2,44,000 crore (US$ 36.6 billion)

- Upgrading skills of labourers by allocating H2,200 crore (US$ 330 million)

- Promoting exports and introducing a special package for the creation of jobs in the apparel sector, mostly for women

- Facilitating technological advancements in the textiles sector via ATUFS

- Introducing a special package for the handloom sector which will include social welfare schemes, insurance cover, cluster development, and up-gradation of obsolete looms, along with tax benefits and marketing support

- Signing a MoU worth Rs,8,835 crore for the development of textile parks, textile processing, machinery, carpet development, among others

- Boosting exports via the Focus Product Scheme, which includes a list of products that are entitled for duty credit scrip equivalent to 2% of freight-on-board value of exports

- Undertaking a range of export promotion activities under the aegis of The Cotton Textiles Export Promotion Council (Source: Ministry of Textiles, IBEF)

SWOT analysis of the Indian textile industry:

Strengths

- Easy availability of low-cost and experienced manpower

- Raw material availability

- Significant domestic as well as international demand

- Accelerated demand for fibres

- Large variety of textile products

Weaknesses

- Highly fragmented

- Weak labour laws

- High power costs, interest rates and indirect taxes

- Lack of technological development

- Lack of economies-of-scale

Opportunities

- The organized apparel segment is expected to grow at a CAGR of 13% over the next decade

- Increasing preference for readymade branded apparels

- Growth in online retail and the emergence of malls

- Withdrawal of quota restrictions

- Improvement in product quality to meet global standards

Rise in disposable incomes Threats

- Competition from countries such as China Striking the right balance between price and quality Maintaining a comfortable demand-and-supply balance

- Lack of stringent environmental and labour laws

Visaka''s standpoint:

Your company is continuing to have the largest installation of Murata Twin jet spinning installation in the world giving the advantage of manufacturing superior quality yarn as compared to conventional ring frame yarn. Your company has been gradually adding spinning machines and also continuously fine-tuning the techniques of manufacturing different varieties of yarns from solid and melange dyed Polyester and Viscose fibres, raw white Linen fibres at the highest speeds. In FY 2016-17 Visaka completed a capex of H70 crore which has increased its capacity by 26% and now has 41 MTS machines with 2752 positions, producing about 10,000 Metric tons of yarns per annum. This additional capacity gives your company the economics of scale in the industry and will be used to produce premium yarn which enjoy higher realizations, generate better demand and are comparatively more insulated from price-based competition. This strategy is expected to allow its textile division to tide over difficult times. The location of unit since is in Vidharba region, where the thermal power production is concentrated gives an edge over the mills in the other parts of the country to keep the power cost at lower levels.

The limitation to manufacture 100% cotton yarns and to a certain extent cotton yarns blended with polyester fibre with the aforesaid spinning system is one constraint. However, the cotton touch feel of Air-jet yarn makes up for it.

Opportunities and threats:

The continuing growth of Indian economy at a steady level helps to increase the demand for apparel fabrics, which is a key segment for our yarns. The recycled polyester fibre industry which has been exempted from taxes curtailed our growth during the past 5 years. Once GST is implemented with uniform taxation this year, it helps to create new opportunity for company''s yarns manufactured using virgin fibres in the domestic market. When cotton yarns also come into the GST fold, it will help the synthetic yarn industry to have a level-playing field.

The strengthening Indian Rupee from H70 to 64 dented our profitability in the past year. Any further strengthening could affect the profits from the export markets. If global cotton fibre production expands, it could reduce the demand for the synthetic yarns, thus reducing our margins. The 3D manufacturing capability for apparels is still in the nascent stage. Once this is successfully commercialized at affordable price, it could pose challenges to the traditional spinning and weaving industry.

OPERATIONAL PERFORMANCE:

Building Products Division

The net turnover of Building Products Division during the year was Rs,782 crores as compared to Rs,818 Crores during the previous year. The decrease was due to the tight money conditions coupled with change in consumption pattern among the users. The reduction is more on account of cement asbestos products while there is growth in the FCB business.

Textile Division:

The net turnover of this division during the current year was Rs,175 crores compared to Rs,172 crores during the previous year.

Analysis of financial statements:

The total turnover of the company for the year FY 2017 was H956.85 cr a decline of 3.3% which is after factoring in the effect of demonetization during the 2nd half of the year. The EBIDT for the year was 12.39%, an increase of 25% over the previous year. Finance cost and depreciation costs reduced by Rs,5.47 cr. The PBT for the year FY 2017 increased by 64% from Rs,40 cr to 66 cr. The PAT increased 67% from Rs,24.43 cr to Rs,40.80 cr. Hence both the margins as well as the finance and depreciation costs contributed to the bottom-line.

The overall gross debt came down by Rs,103 cr during the year ended March 2017. The total debt to equity dropped from 1.02 to 0.64 by the end of March 2017. The working capital cycle reduced by 14 days during the year.

Human resources:

Your Company believes that human resource is its most valuable resource and it is the quality and dynamism of human resources that enables it to make a significant contribution to enhance stakeholders'' value. Your Company has taken a lot of initiatives to train its employees both in-house as well as through reputed Institutes. Your Company always strives to maintain good work culture, ethics, values and rewarding remuneration packages to keep its staff highly motivated.

During the year, industrial relations remained cordial. Your Directors would like to record their appreciation of the efficient and loyal service rendered by the Company''s employees.

Internal controls and their adequacy:

Your Company has in place adequate systems of internal financial controls commensurate with its size and the nature of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable statutes, safeguarding assets from unauthorized use or losses, executing transactions with proper authorization and ensuring compliance of internal policies. The Company has a well-defined delegation of power with authority limits for approving revenue as well as capital expenditure. Processes for formulating and reviewing annual and long term business plans have been laid down to ensure adequacy of the control system, adherence to the management decisions and legal compliances. The Company uses ERP (Enterprise Resource Planning) system to record data for accounting and connects online to different locations for efficient exchange of information. This process ensures that all transaction controls are continually reviewed and risks of inaccurate financial reporting, if any, are dealt with immediately. The Company has in place adequate internal financial controls regarding financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

FIXED DEPOSITS:

During the year under review, your Company has accepted Rs,6.71 Crores as additional deposits from the public and shareholders thus making the outstanding as on March 31, 2017 to Rs,14.99 Crores. As on March 31, 2017, deposits raised under previous Companies Act, 1956 are fully paid off.

In this regard, it is further stated that:

a) there were no deposits lying unpaid or unclaimed at the end of the year i.e. 31.03.2017;

b) There has been no default in repayment of deposits or payment of interest thereon during the year;

c) There are no deposits lying with the Company which are not in compliance with the requirements of Chapter

V of the new Act and

d) As provided under the new Act, the outstanding deposits accepted under the provisions of previous Act have been repaid and squared off, fully.

UNCLAIMED DIVIDEND:

As per the provisions of Section 205C of the Companies Act, 1956, following unclaimed dividend amounts are transferred to Investor Education and Protection Fund upon expiry of the mandatory 7 years period:

Sl.	Particulars	Date of	Amount
No		Transfer	Rs,
1	Final Dividend for the FY 2008-09	12.09.2016	665562
2	First Interim Dividend for the FY 2009-10	12.09.2016	299521
3	Second Interim Dividend for the FY 2009-10	19.12.2016	296618

BANKS AND FINANCIAL INSTITUTIONS:

Your Company has been prompt in making the payment of interest and repayment of loans to the Financial Institutions and interest on working capital to the banks. Banks and Financial Institutions continue to give their unstinted support. The Board records its appreciation for the same.

CORPORATE SOCIAL RESPONSIBILITY:

Your Company, as a responsible Corporate Citizen established Visaka Charitable Trust in the year 2000 as a non-profit entity, to support initiatives that benefit the society at large. The Trust had been already undertaking various activities like provision of drinking water by digging bore wells, construction of irrigation tanks in remote villages, building of Class Rooms in Schools and Colleges, reimbursement of salaries of teachers and supply of class room furniture and conducting health camps.

Keeping in view the above, your Board, thought it appropriate to spend CSR expenditure as mandated under Section 135 of the Companies Act, 2013 either in part or full through the same trust i.e., Visaka Charitable Trust, objectives of which entail it to undertake the CSR activities as contemplated under Schedule VII of the Companies Act, 2013. Your company has during the financial year under review, out of the prescribed CSR expenditure amounting to Rs,66.72 Lakhs, spent an amount of Rs,51.54 Lakhs directly and an amount of Rs,15.18 Lakhs by way of contribution to the trust.

A report on CSR activities as required under Rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014 is enclosed as Annexure - 1. Your Board undertakes to spend the amount towards the aforesaid identified CSR activities through the trust as per the CSR policy of the Company.

CSR policy of the Company may be accessed on the Company''s website at the link: www.visaka.co

DIRECTORS AND KEY MANAGERIAL PERSONNEL:

In pursuance of Article 130(e) of Articles of Association of the Company, Shri. V.ValLinath, Whole-time Director & CFO is liable to retire by rotation at the ensuing annual general meeting and being eligible, offers himself for reappointment.

All the independent Directors have given declarations stating that for the financial year 2017-18, they meet the criteria of Independence as contemplated under Section 149(6) read with Schedule IV to the Act & SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 and the same was taken on record by your Board in its meeting held on May 5, 2017.

Shri.G.Vamsi Krishna has been appointed as Joint Managing Director of the Company for a period of 5 years effective from May 6, 2017.

Shri.V.Vallinath has been reappointed as Whole-time Director & CFO of the Company for a period of 3 years effective from September 9, 2017.

The aforesaid appointments are subject to your approval at the ensuing annual general meeting.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, Directors of your Company state that:

a. in the preparation of the annual accounts for the year ended March 31, 2017, the applicable accounting standards have been followed along with proper explanation relating to material departures; the annual accounts have been prepared in compliance with the provisions of the Companies Act, 2013.

b. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the company for the same period;

c. the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

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

e. they have laid down internal financial controls in the company that are adequate and were operating effectively.

f. they have devised proper systems to ensure compliance with the provisions of all applicable laws, which are adequate and are operating effectively.

CORPORATE GOVERNANCE:

A report on Corporate Governance, along with a certificate of compliance from the Auditors, forms part of this Report.

AUDITORS AND AUDITORS'' REPORT:

Statutory Audit:

You are aware that the provisions relating to rotation of statutory auditors as contemplated under Section 139 of the Companies Act read with relevant rules issued there under is applicable to your company starting from the financial year 2013-14. However, as permitted under the said provisions M/s. Anandam & Co., Chartered Accountants were appointed as Statutory Auditors of the Company to hold the office for a period of three years from the conclusion of 32nd Annual General Meeting of the Company held on 25.07.2014 till the conclusion of ensuing annual general meeting of the Company. Starting from the financial year 2017-18, your company need to comply with the requirements of rotation of auditors.

The Board, based on the recommendations of its Audit Committee, is considering to appoint M/s Price Waterhouse & Co. Chartered Accountants LLP, Chartered Accountants, Hyderabad as statutory auditors to hold the office from the conclusion of ensuing annual general meeting till the conclusion of 6th consecutive annual general meeting (i.e., AGM to be held in the calendar year 2023) and appropriate resolutions in this connection seeking your approval, have been included in the notice calling ensuing Annual General Meeting of the Company.

Cost Audit:

In terms of the Companies (Cost Records and Audit) Rules, 2014, under Companies Act, 2013, M/s.Sagar & Associates, Cost Accountants, Hyderabad were appointed as Cost Accountants of the Company for conducting the Cost Audit of Building Products Division as well as Textiles Products Division for the financial year 2016-17 at a remuneration of H1,50,000/- exclusive of out of pocket expenses and applicable taxes which was ratified by you at the 34th Annual General Meeting of the Company.

Further, the Board after considering the recommendations of its Audit Committee, resolved to appoint the aforesaid firm as cost auditors for the financial year 2017-18 and appropriate resolution in this connection seeking your approval, has been included in the notice calling ensuing Annual General Meeting of the Company.

Pursuant to section 148(6) of Companies Act, 2013 read with rule 6(6) of the Companies (cost records and audit) Rules, 2014, cost audit report for the financial year ended March 31, 2016 was filed with the Central Government on July 2, 2016.

Secretarial Audit:

Pursuant to Section 204 of the Companies Act, 2013, your Board appointed M/s Tumuluru & Co., Practicing Company Secretaries, Hyderabad as Secretarial Auditors for the financial year 2016-17 and Secretarial Audit Report for the financial year ended March 31, 2017 is enclosed as Annexure-2.

CRITERIA FOR IDENTIFICATION, APPOINTMENT, REMUNERATION AND EVALUATION OF PERFORMANE OF DIRECTORS

Your Company constituted Nomination and Remuneration Committee (hereinafter referred to as "the Committee"), to oversee, inter-alia, matters relating to:

a) identify persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, recommend to the Board their appointment and removal;

b) formulate the criteria for determining qualifications, positive attributes and independence of a director;

c) recommend to the Board a policy relating to the remuneration for the directors, key managerial personnel and other employees;

d) carry out evaluation of every director''s performance including that of Independent Directors and

e) devise a policy on Board Diversity.

Criteria to be followed for identification, appointment, remuneration and evaluation of performance of directors including Company''s Board diversity etc., as approved by the Board, aids the committee in discharging aforesaid functions.

The criteria for appointment, qualifications and positive attributes along-with remuneration policy as applicable to Directors, KMPs and other Senior management personnel and criteria to be followed for performance evaluation of each director including Independent Directors of the Company is enclosed as Annexure - 3

FORMAL ANNUAL EVALUATION MADE BY THE BOARD OF ITS OWN PERFORMANCE AND OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS

Your Company believes that it is the collective effectiveness of the Board that impacts Company''s performance and thus, the primary evaluation platform is that of collective performance of the Board.

The parameters for Board performance evaluation, as laid under evaluation criteria adopted by the company, have been derived from the Board''s core role of trusteeship to protect and enhance shareholder value as well as fulfil expectations of other stakeholders through strategic supervision of the Company.

The said criteria also contemplate evaluation of Directors based on their performance as directors apart from their specific role as independent, non-executive and executive directors as mentioned below:

a. Executive Directors, being evaluated as Directors as mentioned above, will also be evaluated based on targets / Criteria given to them by the board from time to time as well as on their respective terms of appointment.

b. Independent Directors, being evaluated as a Director, will also be evaluated on meeting their obligations connected with their independence criteria as well as adherence with the requirements of professional conduct, roles, functions and duties specifically applicable to Independent Directors as contained in Schedule IV to the Companies Act, 2013.

The criteria also specify that the Board would evaluate each committee''s performance based on the mandate on which the committee has been constituted and the contributions made by each member of the said committee in effective discharge of the responsibilities of the said committee.

The Board of Directors of your Company has made annual evaluation of its performance, its committees and directors for the financial year 2016-17 based on afore stated criteria.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-4

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of investments and inter corporate deposits made by the Company, are given in the notes to the Financial Statements (Please refer Note Nos.11 and 16.1). During the year under review, your Company did not give any other loans or guarantees, provide any security or made any Investments as covered under Section 186 of the Companies Act, 2013, other than as disclosed above.

RELATED PARTY TRANSACTIONS

Related party transactions entered during the financial year under review are disclosed in Note No.29 of the Financial Statements of the company for the financial year ended March 31, 2017. These transactions entered were at an arm''s length basis and in the ordinary course of business. There were no materially significant related party transactions with the Company''s Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Form AOC-2, containing the note on the aforesaid related party transactions is enclosed as Annexure-5

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company''s website under investor relations/listing compliances tab at www.visaka.co

RISK MANAGEMENT FRAMEWORK

As a diversified enterprise, your Company believes that, periodical review of various risks which have a bearing on the business and operations is vital to proactively manage uncertainty and changes in the internal and external environment so that it can limit negative impacts and capitalize on opportunities.

Risk management framework enables a systematic approach to risk identification, leverage on any opportunities and provides strategies to manage, transfer and avoid or minimize the impact of the risks and helps to ensure sustainable business growth with stability of affairs and operations of the Company.

Keeping the above in view, your Company''s risk management is embedded in the business processes. As a part of review of business and operations, your Board with the help of the management periodically reviews various risks associated with the business and products of the Company and considers appropriate risk mitigation process. However, there are certain risks which cannot be avoided but the impact can only be minimized. The risks and concerns associated with each segment of your company''s business are discussed while reviewing segment-wise Management and Discussion Analysis. The other risks that the management reviews include:

a. Industry & Services Risk: this includes Economic risks like demand and supply chain, Profitability, Gestation period etc.; Services risk like infrastructure facilities; Market risk like consumer preferences and distribution channel etc.; Business dynamics like inflation/deflation etc.; Competition risks like cost effectiveness.

b. Management and Operational Risk: this includes Risks to Property; Clear and well defined work process; Changes in technology / upgradation; R&D Risks; Agency network Risks; Personnel & labour turnover Risk; Environmental and Pollution Control Regulations etc.; Locational benefits near metros.

c. Market Risk: this includes Raw Material rates; Quantities, quality, suppliers, lead time, interest rate risk and forex risk.

d. Political Risk: this includes Elections; War risk; Country/ Area Risk; Insurance risk like Fire, strikes, riots and civil commotion, marine risk, cargo risk etc.; Fiscal/Monetary Policy Risk including Taxation risk.

e. Credit Risk: this includes Creditworthiness; Risk in settlement of dues by clients and Provisions for doubtful and bad debts.

f. Liquidity Risk: this includes risks like Financial solvency and liquidity; Borrowing limits, delays; Cash/Reserve management risks and Tax risks.

g. Disaster Risk: this includes Natural calamities like fires, floods, earthquakes etc.; Manmade risk factors arising under the Factories Act, Mines Act etc.; Risk of failure of effective disaster Management plans formulated by the Company.

h. System Risk: this includes System capacities; System reliability; Obsolescence risk; Data Integrity risk & Coordination and Interface risk.

i. Legal Risk: this includes Contract risk; Contractual liability; Frauds; Judicial Risk and Insurance risk.

j. Government Policy: This includes Exemptions, import licenses, income tax and sales tax holidays, subsidies, tax benefits etc. Further your Board has constituted a Risk Management Committee, inter-alia, to monitor and review the risk management framework.

OTHER DISCLOSURES

Board Meeting

Four meetings of the Board of Directors were held during the year. For further details, please refer report on Corporate Governance on page no. 74 of this Annual Report.

Audit Committee

The Audit Committee comprises Independent Directors namely Shri B.B. Merchant (Chairman), Shri.V.Pattabhi and Shri. Gusti J. Noria apart from Smt. G. Saroja Vivekanand, Managing Director. All the recommendations made by the Audit Committee were accepted by the Board.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo Information required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is enclosed herewith as Annexure-6.

Vigil Mechanism

Pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company under investor relations/ listing compliances tab at www.visaka.co

Remuneration of Directors, Key Managerial Personnel and Employees:

Statement showing disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed as Annexure-7. In terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of limits set out in said rules forms part of the annual report. Considering the first proviso to Section 136(1) of the Companies Act, 2013 this annual report, excluding the aforesaid information, is being sent to the shareholders of the Company and others entitled thereto. The said information is available for inspection at the registered office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. Any shareholder interested in obtaining a copy thereof, may write to the Company Secretary in this regard.

General:

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

i. Issue of equity shares with differential rights as to dividend, voting or otherwise;

ii. Issue of shares (including sweat equity shares) to employees of the Company under any scheme;

iii. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries and

iv. No significant or material orders were passed by any Regulator or Court or Tribunal which impacts the going concern status and Company''s operations in future.

Your Directors further state that during the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Acknowledgements:

Your Directors would like to express their sincere appreciation for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record once again their deep sense of appreciation for the committed services by the Company''s executives, staff and workers.

On behalf of the Board of Directors

Date: May 5, 2017 BHAGIRAT B. MERCHANT

Place: Secunderabad Chairman

---

Mar 31, 2016

Board’s Report $

The Directors are pleased to present the 34th Annual Report of the Company with Audited Financial Statement for the year ended March 31, 2016. The financial highlights are as follows:

(Rs. in lakhs)

PARTICULARS	2015 - 2016	2014 - 2015
Total Revenues	100758	102355
Profit before depreciation and taxes	7668	7630
Profit before taxes	4037	3321
Provision for taxes (Incl. Deferred Tax)	1594	1197
Profit for the year after taxes	2443	2124
Balance brought forward from previous year	1054	* (114)
Profit available for appropriation	3497	2010
Dividend on equity share capital	794	794
Corporate Dividend Tax	162	162
Transfer to general reserve	1500	-
Balance carried to balance sheet	1041	1054

PERFORMANCE REVIEW AND THE STATE OF COMPANY''S AFFAIRS

Performance of your company has a strong connection to the performance of the rural and semi-urban economies of our country. Due to two consecutive below average monsoons, sluggishness in the economy continued during the financial year under review. There was no agility in the market due to poor demand conditions. Amidst the gloomy economic environment, strategies like aggressive ad campaign, improved operational efficiency, strengthening the Distribution reach, developing new markets and focusing more on higher realization applications etc., helped your company to show a reasonably good performance during the financial year under review.

The Company''s key performance indicators are as under:

- Revenue from operations decreased marginally by 2% to 1005 Crores from 1021 Crores of previous year.

- Cash Profit increased marginally to Rs.76.68 Crores from Rs.76.30 Crores of previous year.

- Net Profit increased to Rs.24.43 crores from Rs.21.24 crores of previous year.

- The capital expenditure for 2015-16 was Rs.18.68 Crores, which was principally on account of ongoing expansion undertaken at the Textile Plant at Nagpur and other normal capital expenditure at various units.

There is no change of business during the year under

review.

Your Company''s shares are listed on the National Stock Exchange (NSE) and Bombay stock exchange Limited (BSE). Variations in the market capitalization and price earnings ratio are provided hereunder:

Parameter	As at March 31, 2016	As at March 31, 2015
Market Capitalisation1 (in Rs. Crores)	168.02	146.10
P/E ratio	6.87	6.88

(* based on closing price at Bombay Stock Exchange Limited, being the higher of two exchanges, as on the respective dates)

Your Company made its initial public offer of equity shares in 1984-85. The closing price (quoted on stock exchanges) of your Company''s share of Rs.10/- each fully paid-up as at March 31, 2016 and March 31, 2015, are 529% and 460% respectively over the price of last public offer made in the year 1991-92.

No material changes and commitments occurred after the close of the year till the date of this Report, which affect the financial position of the Company.

During the year under review:

1. The Hon''ble Arbitral Tribunal constituted to adjudicate the dispute between your Company and M/s. Hyderabad Cricket Association (HCA) with regard to violation of certain Advertisement and displaying rights etc., granted in pursuance of an agreement entered on 16.10.2004 by HCA, passed an award dated March 15, 2016. As per the award it was held inter-alia, that the termination of the agreement by HCA is unsustainable and bad in law and thus, Rs.25.92 Crores were awarded as damages for the various violations committed by HCA under the agreement. Your Company awaits the compliance of the same by HCA.

2. In a defamation suit filed by your company, inter-alia, against Google Inc. USA, Hon''ble 1st Additional Chief Judge, City Civil Court, Secunderabad, the Appellant Court has set aside the judgment cum decree of the trial court, pursuant to which, withdrawal of certain defamatory material placed on the Google blog by one Mr. Gopal a Kri shna, against your Company including promoters was ordered.

The said person, an anti-asbestos lobbyist with vested interest, had posted certain derogatory remarks against the Company''s Asbestos Cement Sheets business and Promoters on a blog ban asbestos India hosted by Google Inc. through Google India Pvt. Ltd. Aggrieved by the said post, your Company pursued the matter with Google Inc. USA and vexed with its attitude had filed a suit in the nature of mandatory injunction directing Google Inc. to remove the said content.

The said lobbyist neither presented himself nor represented even once and his whereabouts are also not known. As on date the said content is not yet withdrawn and the compliance of the Appellate Order by Google Inc., USA., is awaited.

DIVIDEND AND GENERAL RESERVE

Your Directors declared interim dividend of Rs.3/- (i.e., 30%) per share of Rs.10/- each during the financial year under review. Your Directors recommend payment of Final Dividend of Rs.2/- (i.e. 20%) per share of Rs.10/- each for the said Financial Year. With the above, the total dividend recommended would be Rs.5/- (i.e., 50%) per share of Rs.10/-, which is on par with the previous year of Rs.5/-per share (i.e. 50%). The Company is absorbing Corporate Dividend Tax of Rs.161.65 Lakhs on the said Dividend.

Your Company proposes to transfer Rs.1,500 lacs to the general reserve for the financial year ended March 31, 2016.

MANAGEMENT DISCUSSION AND ANALYSIS

Your Company is in the Business of Manufacture and Sale of Cement Asbestos Sheets, Fiber Cement Sheets (V-Boards), Panels and Spinning (Synthetic Spun Yarn). Segment-wise Management Discussion and Analysis is provided hereunder:

A. BUILDING PRODUCTS

i. Cement Asbestos Business Industry structure and developments:

This industry exists for the last 80 years in India.

Cement Asbestos Products continue to be in demand because of the efforts made in making inroads into rural markets for the product, its affordability and other qualities such as corrosion resistance, weather and fire proof nature.

Currently there are about 20 entities in the Industry with about 72 manufacturing plants with an annual capacity of 57.00 Lac MT throughout the Country. The products are marketed under their respective brand names mainly through dealers for the retail segment and directly for projects and government departments.

Opportunities and threats:

Cement asbestos sheets are mainly used as roofing materials in rural and semi-urban housing and by industries and poultry sector.

Cement asbestos sheets are popular as they are inexpensive; need no maintenance and last long when compared to competing products such as thatched roofs, tiled roofs and galvanized iron sheets.

According to the information gathered by the Company, about 60% of rural people use thatched roof/tiles for the shelter. Thatched roof need regular replacement and tiled roof needs continued maintenance. Therefore, whenever the economic conditions improve, the first choice of the rural poor is to replace the roof over their head with the affordable and relatively durable product i.e. Cement Asbestos Sheets. Therefore, your Company sees increased potential for usage of Cement Asbestos Sheets in rural areas.

Presence of increased alternative products in the recent past like Galvam and other metal colour coated sheets is creating some impact on the sales volumes of this product to some extent. However, your Company is introducing new colour coated sheets to overcome the same.

Risks and concerns:

Lack of entry barriers: Lack of entry barriers is attracting new entrants into this line of business.

Activities of Ban Asbestos Lobby: The activities of the Ban Asbestos Lobby instigated by the manufacturers of substitute products continue to be a matter of concern.

Outlook:

In the last year, growth of the Industry was not encouraging due to tight monetary conditions, low demand, low spend on infrastructure development, compounded by pressure on prices and also change of consumption pattern among the users. However, your Company could reduce the said impact to some extent by resorting to aggressive marketing strategies.

Your Company is continuously striving to enhance the product''s distribution reach and increased market presence by strengthening network of stockiest, resorting to aggressive advertisement campaign and introduction of new colour coated sheets. These, coupled with inherent advantages associated with the product such as cost affordability etc., are expected to result in a growth rate of 5% to 10% in the next fiscal.

ii. Boards Industry structure and developments:

There are 8 players in the industry producing identical or similar products with an annual capacity of 396000 MT.

Opportunities and threats:

Fibre Cement Boards (FCB) are environment friendly, save time, cost effective as well as a good substitute for wood and thus help in reducing deforestation. Further it can also be a substitute for gypsum board in certain applications. These products have good aesthetics appeal. They can be used both internally and externally. They are also durable and have a life of over 25 years or more with proper maintenance. Further, the product has Triple advantages of Fire, Water and termite resistance. FCB lends itself to any type of finish - paint, laminate, wall paper, tiles, marble etc.

FCB products are well accepted in Office and Commercial Segments. Of late, Hotel Industry started accepting

Drywalls as Guest Room Dividers. Wet Area application with the product has become an accepted norm and its ability to take the finish of Marble or Tiles is an added advantage.

As far as the Residential Segment is concerned, the entry level is with False Ceiling Tiles in bathrooms. In living rooms and kitchens, the product can be used as shelves and cupboards, because FCB does not get affected by Termite and it is a long life product; External Cladding with

V Premium Boards, Front Elevation with V Premium Planks and Duct Covering to service pipes are well appreciated & accepted by leading builders in lndia; Residential dwelling units with all internal walls made of FCB are catching up very fast.

V Premium stands the test of time, when exposed to different weather conditions; High levels of Fire Resistance (up to 3 hrs fire rating) and Noise Reduction Levels (up to 55 dB) enables easy entry of V Board, in to Hotel Segment. Increased awareness to FCB will help acceptance and market growth. Visaka is the only Company to have Green Certification from CII, for its Non Asbestos Fiber Cement Board Products.

On the negative side, Cellulose pulp has to be imported. Compared to wood and plywood, workability is a matter of concern. Further, initial handling is comparatively difficult. While consumers are preferring this product, the applicators like Carpenters are resisting initially due to difficulty in working on FCB compared to Plywood. Your Company is in the process of educating the applicators, through theoretical and practical training programmes, to ensure better acceptance.

Risks and Concerns:

Lack of entry barriers as well as import of cement board materials from Philippines/Thailand/China and Malaysia are matters of concern.

Outlook:

The industry is growing at an average rate of 15%. Saudi Arabia and Middle East markets are slightly down due to drop in crude oil prices, which is a matter of concern. To offset the same, your Company is exploring opportunities in African countries like Tanzania, Kenya; focusing on other Asian countries like Nepal, Sri Lanka and Pakistan. Your Company has enquiries from Philippines also. New applications for Acoustics and Tile underlay, wall lining etc., is gaining popularity. As Plywood is turning out to be costlier, it is expected that manufacturers will shift towards Cement boards.

iii. Panels

Sandwich Panels are in demand in the market, for use as Partition Material. The ''Reinforced Building Board Sandwiched Panels'' are made of two fibre-reinforced cement sheets enclosing a lightweight core. These panels are fully cured at factory and are ready for installation. These panels are cheaper compared to masonry partitions / wood partitions and are also easy to fix and takes comparatively less time for installation.

Performance of Building Products Division

As against a production of 855293 tonnes made during the previous year the Division has produced 797157 tonnes during the Financial Year ended 31st March, 2016. The sales during the Financial Year Ended on 31st March, 2016 is 796239 tonnes as against 805604 tonnes during the previous Financial year, registering a marginal decrease of 1.16%.

The net turnover of Building Products Division during the year was Rs.818 crores as compared to Rs.833 Crores during the previous year. The decrease was due to the subdued market conditions, modest growth in agriculture sector in the country coupled with change of consumption pattern among the users. The reduction is more on account of cement asbestos products while there is growth in the FCB business.

B. SYNTHETIC YARN BUSINESS

Industry structure and development:

The year 2015-16 witnessed wide fluctuation in oil price between USD 28 and USD 70 per barrel, resulting in bottoming out of prices of petroleum products including Polyester fibre. This led to wild swings in the demand for Polyester based yarns. Timely purchase of raw material and execution of yarn contracts significantly helped your Company to reduce the impact of the vagary in oil prices. As a result of reduction in raw material and yarn prices in the year under review, the turnover of the company was less by about 8 Crores, though the volume of sales went up by about 241 tonnes.

The uncertainty in Chinese economy and its manufacturing facilities also had an impact on the supply side of yarns globally. There were not many new installations of Spinning capacity.

As the oil price is expected to increase in the coming months, it is expected that the demand for textiles will pick up and your Company is expected to perform better in 2016-17.

Opportunities and threats:

With more and more customers consistently requiring good quality yarns, demand for your Company''s yarns will continue to grow. Since, your Company has the largest installation of Murata Twin jet installation in the world, customers approach willingly as one-stop shopping for all their airjet spun yarn needs. The continued increase in per-capita consumption of textiles in India also provides further opportunities.

The El Nino effect which brought drought to India, resulted in water shortage for the fabric processing units. The temperature is set to decline from June 2016 onwards. With the onset of La Nina, bountiful rain all over the country is expected, which should trigger growth in textile business.

With more than 11 million cotton bales in stock (equivalent to half of annual global production), China is expected to flood the market with cotton fibre, which may result in lower price for cotton. Polyester, being a substitute for Cotton will also have immediate impact, in spite of increasing oil price. This could be a threat during the year 2016-17.

With India being the only well managed country amongst the BRICS nations, Rupee has strengthened from about Rs. 69/- to about Rs. 66/- during the first 2 months of 201617. If this strengthening trend of Indian Rupee continues, it will affect the export margins.

Risks and concerns:

The improved power situation in India during the last year is helping the spinners in Tamilnadu to compete with our fine yarns with attractive prices. This may affect your Company''s profitability. The ongoing expansion of spinning capacity of your Company will give an additional production of about 250 tons per month from September 2016 onwards. Steps are initiated for improving Company''s customer base for selling this additional volume. Any delay in acquiring new customers may increase its medium term inventory levels.

Production and Sales volumes:

The production in the spinning unit during the year 2015-16 was 9290 metric tonnes as compared to 8900 metric tonnes during the previous year. The sales were 9199 metric tonnes of yarn (including export of 2429 metric tonnes) during the year under review as compared to 8958 metric tonnes of yarn (including export of 2095 metric tonnes) in the previous year.

Financial Performance:

The net turnover of this division during the Current Year was Rs. 172 crores compared to Rs. 180 crores during the previous year.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

Your Company has in place adequate systems of internal financial controls commensurate with its size and the nature of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable Financial and Operational information, complying with applicable statutes, safeguarding assets from unauthorized use or losses, executing transactions with proper authorization and ensuring compliance of internal policies. The Company has a well-defined delegation of power with authority limits for approving revenue as well as capital expenditure. Processes for formulating and reviewing annual and long term business plans have been laid down to ensure adequacy of the control system, adherence to the management decisions and legal compliances. The Company uses ERP (Enterprise Resource Planning) system to record data for accounting and connects online to different locations for efficient exchange of information. This process ensures that all transaction controls are continually reviewed and risks of inaccurate Financial Reporting, if any, are dealt with immediately.

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation were observed.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT

Your Company believes that Human Resource is its most valuable resource and it is the quality and dynamism of human resources that enables it to make a significant contribution to enhance stakeholders'' value. Your Company has taken a lot of initiatives to train its employees both in-house as well as through reputed Institutes. Your Company always strives to maintain good work culture, ethics, values and rewarding remuneration packages to keep its staff highly motivated.

During the year, the industrial relations at all the workplaces of the Company were cordial.

Your Directors would like to record their appreciation of the efficient and loyal service rendered by the Company''s employees.

FIXED DEPOSITS

During the year under review, your Company has accepted deposits of Rs. 5.38 Crores from the public and shareholders. The amount of deposits outstanding as on March 31, 2016 was Rs. 10.88 Crores out of which Rs.9.98 Crores was accepted under the provisions of Chapter V of the Companies Act, 2013 (new Act) and the balance of Rs.0.90 Crores was accepted as per the provisions of the Companies Act, 1956 (old Act).

In this regard, it is further stated that

a) there were no deposits lying unpaid or unclaimed at the end of the year i.e. 31.03.2016;

b) There has been no default in repayment of deposits or payment of interest thereon during the year;

c) There are no deposits lying with the Company which are not in compliance with the requirements of Chapter

V of the new Act other-than the deposits accepted under the provisions of old Act as aforesaid and

d) As provided under the new Act, the outstanding deposits accepted under the provisions of previous Act are being repaid as per the terms of each deposit.

UNCLAIMED DIVIDEND

As per the provisions of Section 205C of the Companies Act, 1956, unclaimed dividend amount of Rs. 8,84,304/in respect of the year 2007 - 2008 has been transferred to Investor Education and Protection Fund on 03.09.2015 upon expiry of the mandatory 7 years period.

BANKS AND FINANCIAL INSTITUTIONS

Your Company has been prompt in making the payment of interest and repayment of loans to the Financial Institutions and interest on working capital to the banks. Banks and Financial Institutions continue to give their unstinted support. The Board records its appreciation for the same.

CORPORATE SOCIAL RESPONSIBILITY

Your Company, as a responsible Corporate Citizen established Visaka Charitable Trust in the year 2000, as a non-profit entity, to support initiatives that benefit the society at large. The Trust had been already undertaking various activities like provision of drinking water by digging bore wells, construction of irrigation tanks in remote villages, building of Class Rooms in Schools and Colleges, reimbursement of salaries of teachers and supply of class room furniture and conducting health camps.

Keeping in view the above, your Board, thought it appropriate to spend CSR expenditure as mandated under Section 135 of the Companies Act, 2013 either in part or full through the same trust i.e., Visaka Charitable Trust, objectives of which entail, it to undertake the CSR activities as contemplated under Schedule VII of the Companies Act, 2013. Your company has during the financial year under review, out of the prescribed CSR expenditure amounting to Rs.85.01 Lacs, spent an amount of Rs29.01 Lakhs directly and the balance amount of Rs.56.00 Lakhs by way of contribution to the trust.

A report on CSR activities as required under Rule 9 of the Companies (Corporate Social Responsibility) Rules,

2014 is enclosed herewith as Annexure - 1. Your Board undertakes to spend the amount towards the aforesaid identified CSR activities through the trust as per the CSR policy of the Company.

CSR policy of the Company may be accessed on the Company''s website at the link: www.visaka.in/

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In pursuance of Article 130(e) of Articles of Association of the Company, Shri. G. Vamsi Krishna, Whole-time Director is liable to retire by rotation at the ensuing annual general meeting and being eligible, offers himself for reappointment.

All the independent Directors have given declarations stating that for the financial year 2016-17, they meet the criteria of Independence as contemplated under Section 149(6) read with Schedule IV to the Act/SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 and the same was taken on record by your Board in its meeting held on 10th May, 2016.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, Directors of your Company state that:

a. in the preparation of the annual accounts for the year ended 31st March, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures; the annual accounts have been prepared in compliance with the provisions of the Companies Act, 2013.

b. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the company for the same period;

c. the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

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

e. they have laid down internal financial controls in the company that are adequate and were operating effectively.

f. they have devised proper systems to ensure compliance with the provisions of all applicable laws and these are adequate and are operating effectively.

CORPORATE GOVERNANCE

A report on Corporate Governance, along with a certificate of compliance from the Auditors, forms part of this Report.

AUDITORS AND AUDITORS'' REPORT

Statutory Audit:

M/s. M. Anandam & Co., Chartered Accountants were appointed as Statutory Auditors of the Company to hold office for a period of three years from the conclusion of Annual General Meeting of the Company held on

25.07.2014. The said appointment needs to be ratified by the members of the Company at every annual general meeting during the staid period. The Statutory Auditors have confirmed their eligibility to the effect that their reappointment, if made, would be within the prescribed limits under the Act and that they are not disqualified for re-appointment.

As required above, the Board has, after considering the recommendations of its Audit Committee, incorporated a suitable resolution for your consideration in the notice calling ensuing Annual General Meeting of the Company.

The Notes on financial statement referred to in the Auditors'' Report are self-explanatory and do not call for any further comments. The Auditors'' Report neither contain any qualification, reservation or adverse remark nor reported any incident of fraud to the Audit Committee or Board for the year under review.

Cost Audit:

In terms of notification dated December 31, 2014 read with the Companies (Cost Records and Audit) Rules, 2014, under Companies Act, 2013, M/s. Sagar & Associates, Cost Accountants, Hyderabad were appointed as Cost Accountants of the Company for conducting the Cost Audit of Building Products Division as well as Textiles Products Division for the financial year 2015-16 at a remuneration of C1,50,000/- exclusive of out of pocket expenses and applicable taxes which was ratified by you at the 33rd Annual General Meeting of the Company.

Further, the Board after considering the recommendations of its Audit Committee, resolved to appoint the aforesaid firm as cost auditors for the financial year 2016-17 and appropriate resolutions in above connection seeking your approval, have been included in the notice calling ensuing Annual General Meeting of the Company.

Pursuant to section 148(6) of Companies Act, 2013 read with rule 6(6) of the Companies (cost records and audit) Rules, 2014, cost audit report for the financial year ended March 31, 2015 was filed with the Central Government on September 22, 2015.

Secretarial Audit:

Pursuant to Section 204 of the Companies Act, 2013, your Board appointed M/s Tumuluru & Co., Practicing Company Secretaries, Hyderabad as Secretarial Auditors for the financial year 2015-16 and Secretarial Audit Report for the Financial Year ended 31st March, 2016 is enclosed herewith as Annexure-2.

CRITERIA FOR IDENTIFICATION, APPOINTMENT, REMUNERATION AND EVALUATION OF PERFORMANE OF DIRECTORS

Your Company constituted Nomination and Remuneration Committee (hereinafter referred to as "the Committee"), to oversee, inter-alia, matters relating to:

a) identify persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, recommend to the Board their appointment and removal;

b) formulate the criteria for determining qualifications,

positive attributes and independence of a director;

c) recommend to the Board a policy relating to the remuneration for the directors, key managerial personnel and other employees;

d) carry out evaluation of every director''s performance including that of Independent Directors and

e) devise a policy on Board Diversity

Criteria to be followed for identification, appointment, remuneration and evaluation of performance of directors including Company''s Board diversity etc., as approved by the Board, aids the committee in discharging aforesaid functions.

The criteria for appointment, qualifications and positive attributes along-with remuneration policy as applicable to Directors, KMPs and other Senior management personnel and criteria to be followed for performance evaluation of each director including Independent Directors of the Company is enclosed herewith as Annexure - 3

FORMAL ANNUAL EVALUATION MADE BY THE BOARD OF ITS OWN PERFORMANCE AND OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS

Your Company believes that it is the collective effectiveness of the Board that impacts Company''s performance and thus, the primary evaluation platform is that of collective performance of the Board as a whole.

The parameters for Board performance evaluation, as laid under evaluation criteria adopted by the company, have been derived from the Board''s core role of trusteeship to protect and enhance shareholder value as well as fulfill expectations of other stakeholders through strategic supervision of the Company.

The said criteria also contemplates evaluation of Directors based on their performance as directors apart from their specific role as independent, non-executive and executive directors as mentioned below:

a. Executive Directors, being evaluated as Directors as mentioned above, will also be evaluated on the basis of targets / Criteria given to executive Directors by the board from time to time as well as terms of their appointment.

b. Independent Directors, being evaluated as a Director, will also be evaluated on meeting their obligations connected with their independence criteria as well as adherence with the requirements of professional conduct, roles, functions and duties specifically applicable to Independent Directors as contained in Schedule IV to the Companies Act, 2013.

The criteria also specifies that the Board would evaluate each committee''s performance based on the mandate on which the committee has been constituted and the contributions made by each member of the said committee in effective discharge of the responsibilities of the said committee.

The Board of Directors of your Company has made annual evaluation of its performance, its committees and directors for the financial year 2015-16 based on afore stated criteria.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-4

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of investments and inter corporate deposits made by the Company, are given in the notes to the Financial Statements (Please refer Note Nos.12 and 17.1). During the year under review, your Company did not give any other loans or guarantees, provide any security or made any Investments as covered under Section 186 of the Companies Act, 2013, other than as disclosed above.

RELATED PARTY TRANSACTIONS

Related party transactions entered during the financial year under review are disclosed in Note No.28 of the Financial Statements of the company for the financial year ended March 31, 2016. These transactions entered were at an arm''s length basis and in the ordinary course of business. There were no materially significant related party transactions with the Company''s Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Form AOC-2, containing the note on the aforesaid related party transactions is enclosed herewith as Annexure-5

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company''s website at the link: http://www.visaka.in/vilrptpolicy.pdf

RISK MANAGEMENT FRAMEWORK

As a diversified enterprise, your Company believes that, periodical review of various risks those have a bearing on the business and operations is vital to proactively manage uncertainty and changes in the internal and external environment so that it can limit negative impacts and capitalize on opportunities. Risk management framework enables a systematic approach to risk identification, leverage on any opportunities and provides strategies to manage, transfer and avoid or minimize the impact of the risks and also helps to ensure sustainable business growth with stability of affairs and operations of the Company.

Keeping the above in view, your Company''s risk management is embedded in the business processes. As a part of review of business and operations, your Board with the help of the management periodically reviews various risks associated with the business and products of the Company and considers appropriate risk mitigation process. However, there are certain risks which cannot be avoided but the impact can only be minimized. The risks and concerns associated with each segment of your company''s business are discussed while reviewing segment-wise Management and Discussion Analysis. The other risks that the management reviews also include:

a. Industry & Services Risk: this includes Economic risks like demand and supply chain, Profitability, Gestation period etc.; Services risk like infrastructure facilities; Market risk like consumer preferences and distribution channel etc.; Business dynamics like inflation/deflation etc.; Competition risks like cost effectiveness.

b. Management and Operational Risk: this includes Risks to Property; Clear and well defined work process; Changes in technology / up gradation; R&D Risks; Agency network Risks; Personnel & labour turnover Risk; Environmental and Pollution Control Regulations etc.; Vocational benefits near metros.

c. Market Risk: this includes Raw Material rates; Quantities, quality, suppliers, lead time, interest rate risk and forex risk.

d. Political Risk: this includes Elections; War risk; Country/Area Risk; Insurance risk like Fire, strikes, riots and civil commotion, marine risk, cargo risk etc.; Fiscal/Monetary Policy Risk including Taxation risk.

e. Credit Risk: this includes Creditworthiness; Risk in settlement of dues by clients and Provisions for doubtful and bad debts.

f. Liquidity Risk: this includes risks like Financial solvency and liquidity; Borrowing limits, delays; Cash/Reserve management risks and Tax risks.

g. Disaster Risk: this includes Natural calamities like fires, floods, earthquakes etc.; Manmade risk factors arising under the Factories Act, Mines Act etc.; Risk of failure of effective disaster Management plans formulated by the Company.

h. System Risk: this includes System capacities; System reliability; Obsolescence risk; Data Integrity risk & Co-ordination and Interface risk.

i. Legal Risk: this includes Contract risk; Contractual liability; Frauds; Judicial Risk and Insurance risk.

j. Government Policy: This includes Exemptions, import licenses, income tax and sales tax holidays, subsidies, tax benefits etc.

Further your Board has constituted a Risk Management Committee, inter-alia, to monitor and review the risk management framework.

OTHER DISCLOSURES

Board Meeting

Five meetings of the Board of Directors were held during the year. For further details, please refer report on Corporate Governance on page no. 62 of this Annual Report.

Audit Committee

The Audit Committee comprises Independent Directors namely Shri B.B.Merchant (Chairman), Shri. VPattabhi and Shri. Gusti J. Noria apart from Smt. G. Saroja Vivekanand, Managing Director. All the recommendations made by the Audit Committee were accepted by the Board.

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

Information required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is enclosed herewith as Annexure-6.

Vigil Mechanism

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.visaka.biz under investors/policy documents/Vigil Mechanism Policy link.

Particulars of Employees and related disclosures

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules is enclosed herewith as Annexure-7.

Remuneration ratio of the Directors / Key Managerial Personnel/ Employees:

Statement showing disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed herewith as Annexure-8

GENERAL

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

i. Issue of equity shares with differential rights as to dividend, voting or otherwise.

ii. Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

iii. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

iv. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future.

Your Directors further state that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

ACKNOWLEDGEMENT

Your Directors would like to express their sincere appreciation for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the Company''s executives, staff and workers.

On behalf of the Board of Directors

Date: 10.05.2016 BHAGIRAT B. MERCHANT

Place: Secunderabad Chairman

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Mar 31, 2015

Dear Members,

The Directors are pleased to present the 33rd Annual Report of the Company with Audited Financial Statement for the year ended March 31, 2015. The financial highlights are as follows:

PARTICULARS (Rs. in lakhs)

2014-15 2013-14

Total Revenues 102355 89746

Profit before depreciation and Taxes 7630 4125

Profit before taxes 3321 1880

Provision for taxes (Incl. Deferred Tax) 1197 683

Profit for the year after taxes 2124 1197

Balance brought forward from previous year * (114) 1040

Profit available for appropriation 2010 2237

Dividend on Equity Share Capital 794 397

Corporate Dividend Tax 162 68

Transfer to General Reserve - 600

Balance carried to Balance Sheet 1054 1172

* the amount shown is after the adjustment for depreciation on Fixed Assets of which the useful life expired as on 1st April, 2014 against the opening retained earnings.

Performance review or results of operations and the State of Company's affairs

Your company has entered into growth path once again with the improved market conditions. The Net Turnover touched Rs.1013 crores which is 14.7% more than last year and the Profit before depreciation and taxes was Rs.76.30 Crores against Rs.41.25 Crores of previous year Segment-wise/product- wise details are provided in Management Discussion and Analysis as appended hereunder.

The highlights of the Company's performance are as under:

* Revenue from operations increased by 14% to 1021 Crores from 892 Crores.

* PBDIT increased to Rs.98.33 Crores from Rs.62.65 crores

* Cash Profit increased to Rs.76.30 Crores from Rs.41.25 Crores

* Net Profit increased to Rs.21.24 crores from Rs.11.97 crores.

* The capital expenditure for 2014-15 was Rs.41 Crores, which was principally on account of setup of 2.5 MW Solar Power Plant at V-Boards & V-Panels Division, Miryalaguda and modernization cum expansion at AC Division, Raebareli and other normal capital expenditure at various units.

There is no change of business occurred during the year under review.

During the year under review, Visaka Thermal Power Limited (VTPL) ceased to be an associate Company of your Company.

Your Company's shares are listed on the National Stock Exchange (NSE) and Bombay stock exchange Limited (BSE). The variations in the market capitalisation of the company, price earnings ratio is provided hereunder:

Parameter As at March 31,2015 As at March 31, 2014

Market Capitalisation* (in Rs. Crores) 146.10 115.69

P/E ratio 6.88 9.66

(* based on closing price at Bombay Stock Exchange Limited, being the higher of two exchanges, as on the respective dates)

Your Company has made its initial public offer of equity shares in 1984-85. The closing price quoted on stock exchanges of your Company's share of Rs.10/- each fully paid up as at March 31, 2015 and March 31, 2014 are 460% and 364% over the price of last public offer made in the year 1991-92.

No material changes and commitments have occurred after the close of the year till the date of this Report, which affect the financial position of the Company.

DIVIDEND:

Your Directors recommend payment of Final Dividend of Rs.5/- (i.e. 50%) Per Share of Rs.10/- each for the Financial Year ended on March 31, 2015 as against the previous year of Rs.2.50 per share (i.e. 25%). The Company is absorbing Corporate Dividend Tax of Rs.161.65 lakhs on the Equity Dividend and the Dividend declared and paid this year is not taxable in the hands of Shareholders.

The dividend will be paid to members whose names appear in the Register of Members as on July 18, 2015 and in respect of shares held in dematerialised form, it will be paid to members whose names are furnished by National Securities Depository Limited and Central Depository Services (India) Limited, as beneficial owners as on that date.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

Your Company has in place adequate systems of internal control commensurate with its size and the nature of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable Financial and Operational information, complying with applicable statutes, safeguarding assets from unauthorized use or losses, executing transactions with proper authorization and ensuring compliance of internal policies. The Company has a well defined delegation of power with authority limits for approving revenue as well as capital expenditure. Processes for formulating and reviewing annual and long term business plans have been laid down to ensure adequacy of the control system, adherence to the management instructions and legal compliances. The Company uses ERP (Enterprise Resource Planning) system to record data for accounting and connects to different locations for efficient exchange of information. This process ensures that all transaction controls are continually reviewed and risks of inaccurate Financial Reporting, if any are dealt with immediately.

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation were observed.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT:

The Company believes that Human Resource is its most valuable resource which has to be nurtured well and equipped to meet the challenges posed by the dynamics of Business Developments. The Company has a policy of continuous training of its employees both in-house as well as through reputed Institutes. The staff is highly motivated due to good work culture, training, remuneration packages and the values, which the company maintains.

The total number of people employed in the company as on 31.03.2015 is 4350. Your Directors would like to record their appreciation of the efficient and loyal service rendered by the Company's employees.

FIXED DEPOSITS:

During the year under review, your Company has accepted deposits of Rs.5.17 Crores from the public and shareholders. The amount of deposits outstanding as on March 31, 2015 was Rs.7.24 Crores out of which Rs.5.10 Crores was accepted under the provisions of Chapter V of the Companies Act, 2013 (new Act) and the balance of H2.14 Crores was accepted as per the provisions of the Companies Act, 1956 (old Act).

In this regard, it is further stated that

a) there were no deposits lying unpaid or unclaimed at the end of the year i.e. 31.03.2015;

b) There has been no default in repayment of deposits or payment of interest thereon during the year;

c) There are no deposits lying with the Company which are not in compliance with the requirements of Chapter V of the new Act other-than the deposits accepted under the provisions of old Act as aforesaid and

d) As provided under the new Act, the outstanding deposits accepted under the provisions of previous Act are being repaid as per the terms of each deposit.

UNCLAIMED DIVIDEND:

As per the provisions of Section 205C of the Companies Act, 1956, Unclaimed Dividend amount of Rs.6,89,811/- in respect of the year 2006 - 2007 has been transferred to Investor Education and Protection Fund on 05.08.2014 upon expiry of the mandatory 7 years period.

BANKS AND FINANCIAL INSTITUTIONS:

The Company has been prompt in making the payment of interest and repayment of loans to the Financial Institutions and interest on working capital to the banks. Banks and Financial Institutions continue to give their unstinted support. The Board records its appreciation for the same.

CORPORATE SOCIAL RESPONSIBILITY:

Your Company, as a responsible Corporate Citizen has established in the year 2000 a Charitable Trust in the name and style of Visaka Charitable Trust as a non-profit entity to support initiatives that benefit the society at large. The Trust has already undertaken various activities like provision of Drinking Water by digging bore wells, construction of irrigation tanks in remote villages, building of Class Rooms in Schools and Colleges, reimbursement of salaries of teachers and supply of class room furniture and conducting of health camps.

In terms of section 135 of the Companies Act, 2013 (the Act), the Board of Directors of your Company have constituted a CSR Committee and framed a CSR Policy to undertake various initiatives contemplated under Schedule VII of the Act which has been uploaded on the website of the Company at www.visaka.biz under investors/ policy documents/ CSR Policy link. A report on CSR activities as required under Rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014 is enclosed herewith as Annexure - 1.

Keeping in view the various CSR initiatives undertaken through Visaka Charitable Trust as detailed above, your Board has thought it appropriate to spend CSR expenditure for 2014-15 as mandated under Section 135 of the Companies Act, 2013 through the same trust i.e., Visaka Charitable Trust. The Charitable Trust amended its objects incorporating the CSR activities as contemplated under Schedule VII of the Companies Act, 2013. Accordingly to meet the requirements of the Act in this regard, your company has contributed the prescribed CSR expenditure of 2% of average net profits of the company for last three preceding financial years amounting to Rs.97.00 Lacs to Visaka Charitable Trust.

DIRECTORS AND KEY MANAGERIAL PERSONNEL:

At the 32nd Annual General Meeting of the Company held on 25th July, 2014;

i. Shri. Bhagirat B Merchant, Shri. V.Pattabhi, Shri. P. Abraham and Shri. Gusti J Noria were appointed as Independent Directors of the Company to hold office as such for period upto 5 years from 01.04.2014; so long as their appointment is in compliance with provisions of subsections (6) to (8) of Section 149 read with Schedule IV.

ii. Smt. G. Saroja Vivekanand was reappointed as Managing Director of the Company for a period of 5 years effective from 24.10.2014.

iii. Shri. G Vamsi Krishna was appointed as Wholetime Director of the Company for a period of 5 years effective from 01.06.2014.

All the aforesaid independent Directors have given declarations stating that for the financial year 2015-16; they meet the criteria of Independence as contemplated under Section 149(6) read with Schedule IV to the Act and clause 49 (II)(B)(e) of the listing agreement and the same was taken on record by your Board in its meeting held on 7th May, 2015.

During the year under review, Shri. P. Srikar Reddy was appointed as Additional Director of the Company effective from September 6, 2014 and holds the office as such until the date of ensuing Annual General Meeting of the Company.

Shri. P Srikar Reddy has furnished a declaration under Section 149(7) to the effect that he meets the criteria of independent Director and in the opinion of Board of Directors, he fulfils the criteria of independence as mentioned under Companies Act, 2013 read with Schedule IV and relevant rules made thereunder and is independent of Management of the Company. In view of the same, he is eligible for appointment as Independent Director of the Company to hold the office as such for a period upto 5 years effective from the date of ensuing Annual General Meeting, so long as his appointment is in compliance with provisions of subsections (6) to (8) of Section 149 read with Schedule IV to the Act.

Shri. V. Vallinath, who was working as President (Finance) and CFO has been appointed as Whole-time Director and CFO of the Company effective from 09.09.2014 for a period of 3 years.

Further, Shri J. P. Rao, who was working as President (Marketing - AC Sheets Division) has been appointed as Whole-time Director of the Company effective from 07.05.2015 for a period of 3 years.

The Company has received notices in writing from members along-with the deposit of requisite amount under Section 160 of the Act read with Articles of Association of the Company, proposing the candidatures of Shri.P.Srikar Reddy for the office of Independent Director for a period of 5 consecutive years effective from the date of ensuing Annual General Meeting of the Company and Shri.V.Vallinath and Shri. J. P. Rao as Directors of the Company.

The aforesaid appointment of Independent Director and Whole-time directors are subject to your approval and appropriate resolutions are included in the notice calling ensuing Annual General Meeting of the Company for seeking your approval.

Shri. Nagam Krishna Rao, is retiring at the ensuing Annual General Meeting and is eligible for reappointment.

Shri. M P V Rao, who was reappointed as Whole-time Director to hold the office from 01.04.2014 to 31.07.2014 in the last Annual General Meeting of the Company, resigned from the Board effective from closing hours of 31st July, 2014 and the Board places on record its word of appreciation in recognition to the valuable contributions made by Shri. Rao during his long stint of 30 years with the Company in various positions of the Company.

Pursuant to obtaining your approval under postal ballot by way of special resolution, clause 130(e) of the Articles of Association is amended and now Whole-time Directors are liable to retire by rotation. In view of the same, your company complies with all the requirements relating to composition of Board including the one stipulated under Section 152(6)(a) of the Companies Act, 2013 as to having sufficient number of Directors liable to retire by rotation on the Board.

DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to Section 134(5) of the Companies Act, 2013, Directors of your Company here by state and confirm that:

a. in the preparation of the annual accounts for the year ended 31st March, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures; the annual accounts have been prepared in compliance with the provisions of the Companies Act, 2013.

b. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and

fair view of the state of affairs of the company at the end of the financial year and of the profit of the company for the same period;

c. the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

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

e. they have laid down internal financial controls in the company that are adequate and were operating effectively.

f. they have devised proper systems to ensure compliance with the provisions of all applicable laws and these are adequate and are operating effectively.

CORPORATE GOVERNANCE:

A report on Corporate Governance, along with a certificate of compliance from the Auditors, forms part of this Report.

AUDITORS AND AUDITORS' REPORT:

Statutory Audit:

M/s. M. Anandam & Co., Chartered Accountants were appointed as Statutory Auditors of the Company to hold the office for a period three years from the conclusion of last Annual General Meeting of the Company held on 25.07.2014. The said appointment needs to be ratified by the members of the Company at every annual general meeting during the said period and the Statutory Auditors have confirmed their eligibility to the effect that their re-appointment, if made, would be within the prescribed limits under the Act and that they are not disqualified for re-appointment.

As required above, the Board has, after considering the recommendations of its Audit Committee, incorporated a suitable resolution for your consideration and approval in the notice calling ensuing Annual General Meeting of the Company.

The Notes on financial statement referred to in the Auditors' Report are self-explanatory and do not call for any further comments. The Auditors' Report does not contain any qualification, reservation or adverse remark.

Cost Audit:

As per the Companies (Cost Records and Audit) Rules, 2014, issued on 30th June, 2014 under Companies Act, 2013, Company's products were not included under the purview of Cost Audit. However, Ministry of Corporate Affairs vide their Notification dated 31st December, 2014 amended the said rules, pursuant to which, the requirement of cost audit of cost accounting records is applicable to the Company as follows:-

Building Products - From Financial Year 2014-15.

Textiles Products - From Financial Year 2015-16.

In View of the same, the Company had appointed M/s. Sagar & Associates, Cost Accountants, Hyderabad as cost auditors of the Company for conducting cost audit of Synthetic Yarn Division as well as Building Products Division of the Company for the financial year 2014-15 at a remuneration of Rs.1,50,000/- exclusive of out of pocket expenses and applicable taxes subject to your ratification in the ensuing Annual General Meeting of the Company.

Further, the Board has after considering the recommendations of its Audit Committee, resolved to appoint the aforesaid firm as cost auditors for the financial year 2015-16 and appropriate resolutions in above connection seeking your approval, have been included in the notice calling ensuing Annual General Meeting of the Company.

Pursuant to section 233B(4), 600(3)(b) of the Companies Act, 1956 read with Companies (Cost Audit Report) Rules, 2011; cost audit report for the financial year ended 31st March, 2014 was filed with the Central Government on 26th September, 2014.

Secretarial Audit:

Pursuant to Section 204 of the Companies Act, 2013, your Board has appointed M/s Tumuluru & Co., Practicing Company Secretaries, Hyderabad as Secretarial Auditors for the financial year 2014-15 and Secretarial Audit Report for the Financial Year ended 31st March, 2015 is enclosed herewith as Annexure-2.

As regards the comments made in the said report, it is stated that pursuant to obtaining your approval under postal ballot by way of special resolution, clause 130(e) of the Articles of Association is amended and now Whole-time Directors are liable to retire by rotation. In view of the same as on the date of this report, your company complies with all the requirements relating to composition of Board including the one stipulated under Section 152(6)(a) of the Companies Act, 2013 as to having sufficient number of Directors liable to retire by rotation on the Board. Further, constant up- gradation of e-forms on certain technical grounds caused the delay in filing of e-forms.

CRITERIA FOR IDENTIFICATION, APPOINTMENT, REMUNERATION AND EVALUATION OF PERFORMANE OF DIRECTORS:

Your Company as required under the provisions of Section 178 of the Companies Act, 2013 and clause 49 of the listing agreement entered with Stock Exchanges, constituted a Board level committee titled "Nomination and Remuneration Committee" (herein after referred as the "Committee") to oversee, inter-alia, matters relating to

a) identify persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, recommend to the Board their appointment and removal;

b) formulate the criteria for determining qualifications, positive attributes and independence of a director;

c) recommend to the Board a policy relating to the remuneration for the directors, key managerial personnel and other employees;

d) carry out evaluation of every director's performance including that of Independent Directors and

e) devise a policy on Board Diversity

Your Company's Board of Directors, after considering the recommendations of its Nomination and Remuneration Committee in above connection, have approved a document setting out criteria to be followed by nomination and remuneration committee for identification, appointment, remuneration and evaluation of performance of directors including Company's Board diversity.

The aforesaid criteria of appointment, qualifications and positive attributes along-with remuneration policy as applicable to Directors, KMPs and other Senior management personnel and criteria to be followed for performance evaluation of each director including Independent Directors of the Company is enclosed herewith as Annexure - 3

FORMAL ANNUAL EVALUATION MADE BY THE BOARD OF ITS OWN PERFORMANCE AND OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS:

Keeping in view the various provisions of the Companies Act, 2013 and listing agreement dealing with powers, duties and functions of the Board of the Company your Company has adopted criteria for evaluating the performance of its Board, Committees and other Directors including Independent Directors applicable from the financial year 2014-15. The said criteria contemplates evaluation of Directors based on their performance as directors apart from their specific role as independent, non-executive and executive directors as mentioned below:

a. Executive Directors, being evaluated as Directors as mentioned above, will also be evaluated on the basis of targets / Criteria given to executive Directors by the board from time to time as well as per their terms of appointment.

b. Independent Directors, being evaluated as a Director, will also be evaluated on meeting their obligations connected with their independence criteria as well as adherence with the requirements of professional conduct, roles, functions and duties specifically applicable to Independent Directors as contained in Schedule IV to the Companies Act, 2013.

The criteria also specifies that the Board would evaluate each committee's performance based on the mandate on which the committee has been constituted and the contributions made by each member of the said committee in effective discharge of the responsibilities of the said committee.

The Board of Directors of your company has made annual evaluation of its performance, its committees and directors for the financial year 2014-15 based on afore stated criteria.

EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-4

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

Details of loans given by the Company, covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements (Please refer Note No.17.1) pertaining to the year under review. During the year under review, your Company did not give any other loans or guarantees, provide any security or made any Investments.

RELATED PARTY TRANSACTIONS:

Related party transactions entered during the financial year under review are disclosed in Note No.30 of the Financial Statements of the company for the financial year ended March 31,2015. These transactions entered were at an arm's length basis and in the ordinary course of business. There were no materially significant related party transactions with the Company's Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Form AOC-2, containing the note on the aforesaid related party transactions is enclosed herewith as Annexure-5

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company's website at the link: http://www.visaka.biz/vilrptpolicy.pdf

RISK MANAGEMENT FRAMEWORK:

In today's economic environment, Risk Management is a very important part of business. The main aim of risk management is to identify, monitor and take precautionary measures in respect of the events that may pose risks for the business. Your Company's Board believes that to ensure sustainable business growth with stability of affairs and operations of the Company periodical review of various risks having a bearing on the business and operations is vital to proactively manage uncertainty and changes in the internal and external environment to limit negative impacts and capitalize on opportunities. Further, it is also belief of your management that Risk Management Framework enables a systematic approach to risk identification, leverage of any opportunities and provides treatment strategies to manage, transfer and avoid or minimize the impact of the risks.

Keeping in view of the above, your Company's risk management is embedded in the continuous business processes and as a part of review of business and operations, your Board with the help of the management periodically reviews various risks associated with the business and products of the Company and considers appropriate risk mitigation process. However there are certain risks which cannot be avoided but the impact can only be minimized. The risks and concerns associated with each segment of your company's business are discussed while reviewing segment-wise Management and Discussion Analysis. The other risks that the management reviews also include:

a. Industry & Services Risk: this includes Economic risks like demand and supply chain, Profiatability Gestation period etc.; Services risk like infrastructure facilities; Market risk like consumer preferences and distribution channel etc.; Business dynamics like inflation/deflation etc.; Competition risks like cost effectiveness

b. Management and Operational Risk: this includes Risks to Property; Clear and well defined work process; Changes in technology / up gradation; R&D Risks; Agency network Risks; Personnel & labour turnover Risk; Environmental and Pollution Control Regulations etc.; Locational benefits near metros

c. Market Risk: this includes Raw Material rates; Quantities, quality, suppliers, lead time, interest rates risk and forex risk.

d. Political Risk: this includes Elections; War risk; Country/ Area Risk; Insurance risk like Fire, strikes, riots and civil commotion, marine risk, cargo risk etc.; Fiscal/ Monetary Policy Risk including Taxation risk.

e. Credit Risk: this includes Creditworthiness; Risk in settlement of dues by clients and Provisions for doubtful and bad debts

f. Liquidity Risk: this includes risks like Financial solvency and liquidity; Borrowing limits, delays; Cash/Reserve management risks and Tax risks

g. Disaster Risk this includes Natural calamities like fires, floods, earthquakes etc.; Man made risk factors arising under the Factories Act, Mines Act etc.; Risk of failure of effective disaster Management plans formulated by the Company.

h. System Risk this includes System capacities; System reliability; Obsolescence risk; Data Integrity risk & Co-ordination and Interface risk.

i. Legal Risk: this includes Contract risk; Contractual liability; Frauds; Judicial Risk and Insurance risk

j. Government Policy: This includes Exemptions, import licenses, income tax and sales tax holidays, subsidies, tax benefits etc.

Further your Board has constituted a Risk Management Committee, inter-alia, to monitor and review the risk management framework.

OTHER DISCLOSURES:

Board Meetings:

Seven meetings of the Board of Directors were held during the year For further details, please refer report on Corporate Governance on page no. 58 of this Annual Report.

Audit Committee:

The Audit Committee comprises Independent Directors namely Shri B.B.Merchant (Chairman), Shri. V.Pattabhi and Shri. Gusti j. Noria apart from Smt. G. Saroja Vivekanand, Managing Director. All the recommendations made by the Audit Committee were accepted by the Board.

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

Information required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is enclosed herewith as Annexure-6.

Vigil Mechanism:

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.visaka.biz under investors/policy documents/Vigil Mechanism Policy link.

Particulars of Employees and related disclosures:

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules is enclosed herewith as Annexure-7.

Remuneration ratio of the Directors / Key Managerial Personnel/ Employees:

Statement showing disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed herewith as Annexure-8

GENERAL:

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

i. Issue of equity shares with differential rights as to dividend, voting or otherwise.

ii. Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

iii. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

iv. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future.

Your Directors further state that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

ACKNOWLEDGEMENT:

Your Directors would like to express their sincere appreciation for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the Company's executives, staff and workers.

On behalf of the Board of Directors

Date: 07.05.2015 BHAGIRAT B. MERCHANT Place: Secunderabad Chairman

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Mar 31, 2014

Dear Members,

The Directors are pleased to present the 32nd Annual Report of the Company with Audited Financial Statement. The financial highlights are as follows:

(Rs. in lakhs)

Particulars 2013 - 2014 2012 - 2013

Total Revenue 89746 91816

Profit for the year before taxation 1880 7464

Provision for taxation 683 2395

Profit for the year after taxation 1197 5069

Balance brought forward from previous year 1040 1083

Profit available for appropriation 2237 6152

Dividend on Equity Share Capital 397 953

Corporate Dividend Tax 68 159

Transfer to General Reserve 600 4000

Balance carried to Balance Sheet 1172 1040

DIVIDEND

Your Directors recommend payment of Dividend of H2.50 (i.e. 25 %) Per Share of H10/- each for the Financial Year ended on 31st March, 2014. The Company is absorbing Corporate Dividend Tax of H67.48 lakhs on the Equity Dividend and the Dividend declared and paid this year is not taxable in the hands of Shareholders.

MANAGEMENT DISCUSSION AND ANALYSIS:

Your Company is in the Business of Manufacture and Sale of Cement asbestos Sheets, V – Boards (Fiber Cement Sheets), Panels and Spinning Yarn.

A. BUILDING PRODUCTS

i. Cement Asbestos Business:

Industry Structure and Developments:

This industry exist in India for the last 80 years.

Cement Asbestos Products continue to be in demand because of the efforts made in making inroads into rural markets for the product, its affordability, and other qualities such as corrosion resistance, weather and fire proof nature.

Currently there are about 20 entities in the Industry with about 68 manufacturing plants throughout the Country. The products are marketed under their respective brand names mainly through dealers for the retail segment and directly for projects and government departments.

Opportunities and Threats:

Cement asbestos Sheets are mainly used as roofing materials in rural and semi-urban housing and by industries and poultry sector.

Cement asbestos Sheets are popular as they are inexpensive; need no maintenance and last long when compared to competing products such as thatched roofs, tiled roofs and galvanized iron sheets.

According to the information gathered by us, almost 75 - 80% of rural people use thatched roof/tiles for the shelter. Thatched roof need regular replacement and tiled roof needs continued maintenance. Therefore, whenever the economic conditions improve, the first choice of the rural poor to replace the roof over their head is the affordable and relatively durable product Cement asbestos Sheets. Therefore, we see increased potential for usage of Cement asbestos Sheets in rural areas.

Presence of increased alternative products in the recent past has created some impact on the sales volumes of this product.

Risks and Concerns:

Lack of entry barriers: Lack of entry barriers is attracting new entrants into this line of business. Closure of Canadian and Zimbabwe asbestos mines are matter of concern.

Increase in input costs: The continuous increase in cost of inputs is a matter of concern.

Activities of Ban Asbestos Lobby: The activities of the Ban Asbestos Lobby instigated by the manufacturers of substitute products continue to be a matter of concern.

Production and sales Volumes:

As against a production of 743624 tonnes during the previous year, the production during the Financial Year ended 31st March, 2014 was 599011 tonnes. The sales during the Financial Year Ended on 31st March, 2014 was 640184 tonnes as against 683008 tonnes sold during the Financial Year 2012 – 2013 recording a decrease of 6%.

Financial Performance:

The net turnover of Cement asbestos Division during the year was H629 crores as compared to H684 crores during the previous year, due to overall economic slowdown and availability of alternative products at competitive price.

Outlook:

Due to slow down of economy, market has not improved and alternate products have made some inroad in to the market. However, news that is coming suggest that bottoming out of economic slow-down is taking place. Hence, we may expect improved performance in the near future.

ii. Boards:

Industry Structure and Developments:

The Capacity of the Industries producing same or similar product is 396000 Metric Tonnes per Annum with totally 8 players.

Opportunities and Threats:

The product is environmental friendly, saves time and cost effective as well as a good substitute for wood and helps in reducing deforestation. It has aesthetics appeal and can take paint of choice. It can be used both internally and externally. It is also durable and can stand for over 25 years or more with proper maintenance. Further, it has Triple advantage of Fireproof, Water resistant and termite resistant. It is being widely accepted in residential Segment, especially wet areas. It is also finding good acceptance in Hotels, Hospitals and Colleges due to its fire rating and acoustic properties.

On the negative side, Cellulose pulp has to be imported. Compared to wood/plywood workability is a matter of concern. Further, initial handling is comparatively difficult. While the consumers are preferring this product, the applicators like Carpenters would not find convenient due to difficulty in working on this product compared to Plywood. We are in the process of educating the applicators to ensure acceptance.

Risks and Concerns:

Lack of entry barriers: Import of Cement board materials from Philippines/Thailand / China and Malaysia is a matter of concern.

Production and sales Volumes:

The total production for the year ended 31st March, 2014 was 56249 Metric tonnes as against production for the year ended 31st March, 2013 of 45810 Metric Tonnes, and sales for the year ended on 31st March, 2014 was 48892 Metric Tonnes (including export of 12568 Metric Tonnes) as against 40365 (including export of 11062) Metric Tonnes for the previous year.

Financial Performance:

The net turnover from this division during the year was H 66 crores as compared to H53 crores during the previous year. During the later part of the year the Board unit at Daund, Pune has commenced its commercial operations, which is expected to result in increased production and turnover.

Outlook

The industry is growing at an average rate of 13% to 15% annually. Export opportunities in African and GCC countries is encouraging. Australian / Sri Lankan and Maldives markets are also opening up. New applications such as Tile Underlay and Kitchen cabinets are gaining popularity. In areas of Acoustics like Theatres and Hospitals, use of Cement boards is increasing.

iii. Panels

Sandwiched Panels are in demand in the market, for use as Partition Material. The ''Reinforced Building Board Sandwiched Panels'' are made of two fibre-reinforced cement sheets enclosing a lightweight core. These panels are fully cured at factory and are ready for installation. These panels are cheaper compared to masonary partitions / wood partitions and are also easy to fix and takes comparatively less time for installation.

The production during the year was 9176 metric tonnes as against 7514 during the previous year. Sales was 8638 metric tonnes as against 6875 metric tonnes during the previous year.

The net turnover was H12.47 crores as against H9.90 crores during the previous year.

B. SYNTHETIC YARN BUSINESS: Industry structure and development

The demand for textiles and clothing in our country is on a steady upward trend resulting from increased disposable income. This growth and our efforts to increase our presence in the niche markets helped our company to command a premium in the market place, thus improving the profits. Weak Indian Rupee helped us gain better margins from the export earnings. In the first half of the year, there had been good amount of cotton yarn export to China. The power shortage situation in Tamil Nadu still continues. These factors also have helped us maintain the sales without undue seasonal fluctuations. The addition of 10% capacity and effective energy management have helped us reigning the costs. We have been certified for ISO 50001 for energy management.

Opportunities and Threats

Our country''s growing economy with expected GDP growth of 6 to 7% will create new avenues of demand for textiles and clothing.

The power shortage in the Country is expected to continue and may keep the yarn supply position tight. If the export of cotton yarn to China is revived, it will bring an opportunity to improve yarn prices in general.

The strengthening of Indian Rupee against USDollar may reduce our export margins in the months ahead.

Many spinning mill projects have been initiated in Maharashtra and Gujarat. Once these mills start the production in full swing, there could be an imbalance of supply demand position.

Risks and Concerns

The strengthening of Indian Rupee against US Dollar may reduce our export margins in the months ahead.

Production and Sales Volumes:

The production in the spinning unit during the year 2013-14 was 8614 metric tonnes as compared to 7897 metric tonnes during the previous year. The sales were 8522 metric tonnes of yarn (including export of 1609 metric tonnes) during the year 2013 - 2014 as compared to 8252 metric tonnes (including export of 2094 metric tonnes) in the previous year.

Financial Performance:

The net turnover of this division during the current year was H178 crores compared to H165 crores during the previous year.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

Your Company has in place adequate systems of internal control commensurate with its size and the nature of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable Financial and Operational information, complying with applicable statutes, safeguarding assets from unauthorized use or losses, executing transactions with proper authorization and ensuring compliance of internal policies. The Company has a well defined delegation of power with authority limits for approving revenue as well as capital expenditure. Processes for formulating and reviewing annual and long term business plans have been laid down to ensure adequacy of the control system, adherence to the management instructions and legal compliances. The Company uses ERP (Enterprise Resource Planning) system to record data for accounting and connects to different locations for efficient exchange of information. This process ensures that all transaction controls are continually reviewed and risks of inaccurate Financial Reporting, if any, are dealt with immediately.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT:

The Company believes that Human Resource is its most valuable resource, which has to be nurtured well and equipped to meet the challenges posed by the dynamics of Business Developments. The Company has a policy of continuous training of its employees both in-house as well as through reputed Institutes. The staff is highly motivated due to good work culture, training, remuneration packages and the values, which the company maintains.

The total number of people employed in the company as on 31.03.2014, is 4119. Your Directors would like to record their appreciation of the efficient and loyal service rendered by the Company''s employees.

FIXED DEPOSITS:

Your Company has been inviting and accepting deposits from the public and shareholders. The amount of deposits outstanding as on March 31, 2014 was H7.37 Crores.

Due to change of procedure for accepting public deposits under new Companies Act, 2013; effective from 01.04.2014, your company is not accepting nor renewing deposits. Further as provided under the new Act, the aforesaid outstanding deposits, which were raised under the provisions of previous Act will be repaid as per the terms of each deposit. Further, your Company has already sought your approval under Postal Ballot mode for accepting the deposits as per the provisions of the new Act and once the said approval is obtained, your Company would be initiating steps for accepting the public deposits.

There are no unclaimed deposits, which are transferable to the Investor Education and Protection Fund under Section 205C of the Companies Act, 1956.

UNCLAIMED DIVIDEND:

As per the provisions of Section 205C of the Companies Act, 1956, Unclaimed Dividend amount of H4,95,033/- in respect of the year 2005 – 2006 has been transferred to Investor Education and Protection Fund on 4.07.2013 upon expiry of the mandatory 7 years period.

BANKS AND FINANCIAL INSTITUTIONS:

The Company has been prompt in making the payment of interest and repayment of loans to the Financial Institutions and interest on working capital to the banks. Banks and Financial Institutions continue to give their unstinted support. The Board records its appreciation for the same.

CORPORATE SOCIAL RESPONSIBILITY:

Your Company, as a responsible Corporate Citizen established in the year 2000, a Charitable Trust in the name and style of Visaka Charitable Trust as a non-profit entity, to support initiatives that benefit the society at large. The Trust supports programs devoted to the cause of destitute, rural poor and providing the basic necessities of life to the rural poor. This has helped to enhance the image of the Company.

Main area of activity of the Trust is to provide Drinking Water by digging bore wells, construction of irrigation tanks in remote villages, building of Class Rooms in Schools and Colleges, reimbursement of salaries of teachers, supply of class room furniture and conducting of health camps.

Further, as required under the new Companies Act, 2013; commencing from financial year 2014-15, your Company, each year, has to spend at least 2% of its average profits during three immediately preceding financial years towards Corporate Social Responsibility (CSR) Policy. Your Board of Directors have constituted CSR Committee to formulate and recommend CSR Policy and to comply with other requirements as mandated under the new Companies Act.

DIRECTORS:

In terms of the provisions of the new Companies Act, 2013; your Company need to have at least one-third of the total number of directors as independent directors, who shall hold the office for term up to 5 consecutive years. Section 149 of the new Act further provides that any tenure of Independent Director on the date of commencement of the Companies Act, 2013 i.e. 01.04.2014 shall not be counted as term for aforesaid period of 5 years and also lays down additional criteria apart from the criteria specified under clause 49 of listing agreement with stock exchanges for becoming an Independent Directors of the Company.

Shri. Bhagirat B Merchant, Shri. Gusti J Noria, Shri. P Abraham, Shri. Nagam Krishna Rao and Shri. V. Pattabhi were earlier appointed as Director liable to retire by rotation under erstwhile Companies Act, 1956 and holds office as Independent Director of the Company under clause 49 of the listing agreement with stock exchanges. They have held the positions as such for more than 5 years.

Shri. Bhagirat B Merchant, Shri. P. Abraham, Shri. V. Pattabhi and Shri. Gusti J Noria have furnished declarations under Section 149(7) of the new Act to the effect that they meet the criteria of independent Directors and in the opinion of the Board of Directors, the said independent Directors fulfil the conditions specified in the Companies Act, 2013 and rules made thereunder and they are independent of the Management. In view of the same, they are eligible for appointment as Independent Directors of the company to hold office as such for a period upto 5 years effective from 01.04.2014; so long as their appointment is in compliance with provisions of subsections (6) to (8) of Section 149 read with Schedule IV.

The Company has received notices in writing from members along with the deposit of requisite amount under Section 160 of the Act, proposing the candidatures of Shri. Bhagirat B Merchant, Shri. Gusti J Noria, Shri. V. Pattabhi and Shri. P Abraham respectively for the office of Independent Directors of the Company for a period of 5 consecutive years effective from 01.04.2014.

Effective from 01.04.2014, pursuant to new criteria under the new Companies Act, 2013; Shri. Nagam Krishna Rao had become non-Independent non-executive Director, whose office is liable to retire by rotation. Shri. Nagam Krishna Rao is retiring at the ensuing Annual General Meeting and is eligible for reappointment.

Smt. G. Saroja Vivekanand is proposed to be reappointed as Managing Director of the Company for a period of 5 years effective from 24.10.2014.

Shri. M. P. V. Rao, is re-appointed as Whole-time Director of the Company to hold office from 01.04.2014 to 31.07.2014.

Further, Mr. G. Vamsi Krishna is appointed as Whole-time Director of the Company effective from 01.06.2014 for a period of 5 years.

The aforesaid appointment/reappointment of Independent Directors, Managing Director and Whole-time directors are subject to your approval.

DIRECTORS'' RESPONSIBILITY STATEMENT:

As required by the provisions of Section 217(2AA) of the Companies Act, 1956, the Directors'' Responsibility Statement is appended hereto and forms part of this Report.

CORPORATE GOVERNANCE:

A report on Corporate Governance, along with a certificate of compliance from the Auditors, forms part of this Report.

AUDITORS:

M/s. M. Anandam & Co., Chartered Accountants, retire as Auditors in this Annual General Meeting and are eligible for reappointment.

Your Company would comply with the requirement of Rotation of Auditors within 3 years as permitted under the new Companies Act, 2013.

COST AUDITORS:

In terms of Cost Audit Orders issued by Ministry of Corporate Affairs in 2012, M/s. Sagar & Associates, Cost Accountants were appointed as cost auditors of the Company for conducting cost audit of Synthetic Yarn Division as well as Building Products Division of the Company for the financial year 2013 -14 at a remuneration of H1,50,000/- exclusive of out of pocket expenses and applicable taxes. The Cost Auditor is expected to give his report by end of September, 2014.

As regards the Cost Audit for the financial year 2014-15; your company awaits the rules to be issued in this connection under the new Companies Act, 2013 and your Directors undertake to comply with the same in due course. The remuneration to be payable in that connection to the cost auditors would be placed before the shareholders in the ensuing Annual General Meeting for ratification, to comply with the requirements of Companies Act, 2013.

GENERAL:

The information required under Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 with respect to conservation of energy, technology absorption and foreign exchange earnings / outgo is appended hereto and forms part of this Report.

Information as per Section 217(2A) of the Companies Act, 1956 read with the Companies (particulars of employees) Rules, 1975, as amended, forms part of this Report.

On behalf of the Board of Directors

Date: 24.05.2014 BHAGIRAT B. MERCHANT

Place: Secunderabad Chairman

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Mar 31, 2013

Visaka Industries Limited

The Directors are pleased to present the 31st Annual Report of the Company with Audited Balance Sheet and Statement of Accounts. The financial highlights are as follows

(Rs.lakhs)

PARTICULARS 2012-2013 2011-2012

Total Revenue 91816 75512

Profit for the year before taxation 7464 5124

Provision for taxation 2095 1690

Profit for the year after taxation 5069 3434

Balance brought forward from previous year 1082 1570

Profit available for appropriation 6151 5004

Dividend on Equity Share Capital 953 794

Corporate Dividend Tax 159 128

Transfer to General Reserve 4000 3000

Balance carried to Balance Sheet 1039 1082

Dividend:

Your Directors Declared Interim Dividend of Rs.2.50 (i.e. 25%) per share of Rs.10 each during the Financial Year 2012 -2013 Your Directors recommend payment of Final Dividend of Rs.3.50 (i.e. 35 %) Per Share of Rs.10 each for the Financial Year ended on 31st March, 2013. With the above the total Dividend Paid will be Rs.6 (i.e. 60%) per Share of Rs.10 each. The Company is absorbing Corporate Dividend Tax of Rs.158.87 lakhs on the Equity Dividend and the Dividend declared and paid this year is not taxable in the hands of Shareholders

Management Discussion and Analysis:

Your Company is in the business of manufacturing and selling cement asbestos sheets, V - Boards (fibre cement sheets), panels and spinning yarn

a) BUILDING PRODUCTS BUSINESS:

Cement Asbestos division:

This industry is more than 75 years old in India

Cement asbestos products continue to be in demand because of the industry''s efforts in making more roads in rural regions, its affordability, and other qualities such as corrosion resistance, weather resistance and fire-proof nature.

Currently there are about 20 entities in the industry with about 68 manufacturing plants throughout the country. The products are marketed under their respective brand names mainly through dealers for the retail market and directly for projects and Government departments.

Opportunities and threats:

Cement asbestos sheets are mainly used as roofing materials in rural and semi-urban housing and by industries like the poultry sector.

Cement asbestos sheets are popular as they are inexpensive, need no maintenance and last longer when compared to competing products such as thatched roofs, tiled roofs and galvanised iron sheets.

According to the information gathered by us almost 80 - 85% of rural people use thatched roof/tiles for shelter. Thatched roofs need regular replacement and tiled roof needs continued maintenance. Therefore whenever the economic conditions improve the first choice of the rural population is to replace the roof over their head with the affordable and relatively durable product namely, cement asbestos sheets. Therefore, we see increased potential for usage of Cement asbestos Sheets in rural areas

The Central and State Governments have been giving lot of thrust on housing for the rural population and cement asbestos sheets are widely used for this purpose.

Both the existing and new manufacturers are venturing into setting up of new cement asbestos sheet producing plants This could increase the competition and will have an effect on the margins.

The increased input cost is also a matter of concern

Risks and concerns:

Lack of entry barriers is attracting new entrants into this line of business. Closure of Canadian and Zimbabwean asbestos mines is a matter of concern

The continuous increase in cost of inputs is a matter of concern

The activities of the ''Ban Asbestos'' lobby instigated by the manufacturers of substitute products continue to be a matter of concern

Production and sales volumes:

As against a production of 654198 tonnes during the previous year the production during the financial year ended 31st March, 2013 was 743624 tonnes. The sales during the financial year ended on 31st March, 2013 were 683243 tonnes as against 654439 tonnes sold during FY 2011-12 recording an increase of 4.4%.

Financial performance:

The net turnover of the cement asbestos division during the year was Rs.684 cr as compared to Rs.558 cr during the previous year.

Outlook:

The arrival of new entrants have caused the competition to become more acute.

BOARDS DIVISION AND PANELS DIVISION:

Industry structure and developments:

The capacity of the industries producing same or similar product is 281000 metric tonnes per annum with total of seven players

Opportunities and threats:

These are environmentally-friendly products which save time and are cost-effective. They are a good substitute for wood and helps in reducing deforestation. They have an aesthetic appeal and can be painted in any colour and can be used both internally and externally. They are durable and can stand for over 25 years or more with proper maintenance.

They bring in the triple advantage of being fireproof, water- resistant and termite-resistant.

Cellulose pulp needed to manufacture these boards and panels have to be imported. Compared to wood/plywood workability is a matter of concern, moreover initial handling is comparatively difficult as well

Risks and concerns:

There is a lack of entry barriers. Import of cement board materials from Philippines/Thailand/China and Malaysia is a matter of concern

Production and sales volumes:

The total production for the period ended 31st March, 2013 was 45,810 metric tonnes as against production for the year ended 31st March, 2012 of 40,047 Metric Tonnes, and sales for the year ended on 31st March, 2013 was 40,365 metric tonnes (including export of 11,062 metric tonnes) as against 36,377 (including export of 16,966) metric tonnes for the previous year.

Financial performance:

The net turnover from this division during the year was Rs.53 cr as compared to Rs.44 cr during the previous year.

Outlook

The industry is growing at an average rate of 13% to 15% annually. Export opportunities in African and GCC countries are encouraging. Australian/Sri Lankan and Maldivian markets are also opening up. New applications such as tile underlay and kitchen cabinets are gaining popularity. In areas like acoustics in theatres and hospitals, use of cement boards is increasing

Sandwiched panel unit

Sandwiched panels are in demand in the market, for use as partition material. The ''Reinforced Building Board Sandwiched Panels'' are made of two fibre-reinforced cement sheets enclosing a lightweight core. These panels are fully cured at the factory and are ready for installation. These panels are cheaper compared to masonary partitions/wood partitions and are also easy to fix and takes comparatively less time for installation

The production during the year was 7,514 metric tonnes as against 5,957 metric tones during the previous year. Sales were 6.875 metric tonnes as against 5,279 metric tonnes during the previous year.

The net sales turnover was Rs.9.89 cr as against Rs.7.40 cr during the previous year.

b) SYNTHETIC YARN BUSINESS:

Industry structure and development

Spinning division did well during the year 2012-13

The drastic increases in power tariff in our country coupled with higher polyester fibre prices have made our yarns uncompetitive in the international market place. Also, rampant usage of recycled polyester fibre by the ring spinning industry has taken away the market for commodity products

Price of synthetic yarns from South-East Asian nations continue to be much lower than the Indian yarn prices in the international marketplace.

Opportunities and threats

With about 50% of installed spinning capacity in our country, with severe power shortage during the year 2012-13, Tamil Nadu has virtually paralysed the spinning activity in our country.

Our spinning mill, which is strategically located in power- surplus Vidharba region has worked with 95.2% utilisation, thus we have enjoyed the second best performing year in our spinning history.

The introduction of TUFS (Technological Upgradation Fund Scheme), will bring in unprecedented facilities for investment in textiles. Gujarat and Maharashtra are poised to increase the spinning capacity by about two million spindles during 2013-14. As the capacity addition in weaving and knitting is not commensurate with spinning, there could be an over supply of yarn for a while, till a balance is achieved

Risks and concerns

The major concerns include currency fluctuations and fall in fibre prices

Outlook for 2013-14

Our yarns are used for the manufacture of high-end garments in India. The continued strong growth in per capita consumption of textiles in our country, especially in the readymade garments sector should augur well for further growth and ensure profits for our spinning division. Also, the current surge in demand for Indian cotton yarns from China has created a shortage of yarn in India, which should help us to do well in 2013-14 as well.

Production and sales volumes:

The production in the spinning unit during the year 2012 - 2013 was 7,897 metric tonnes as compared to 8,030 metric tonnes during the previous year. The sales were 8,252 metric tonnes of yarn (including export of 2,094 metric tonnes) during the year 2012 - 2013 as compared to 7,717 metric tonnes (including export of 2,416 metric tonnes) in the previous year.

Financial Performance:

The net turnover of this division during the last fiscal was Rs.165 cr compared to Rs.137 cr during the previous year.

Internal control systems and their adequacy:

Your Company has in place adequate systems of interna control commensurate with its size and the nature of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable statutes, safeguarding assets from unauthorised use or losses, executing transactions with proper authorisation and ensuring compliance of internal policies. The Company has a well-defined delegation of power with authority limits for approving revenue as well as capital expenditure. Processes for formulating and reviewing annual and long-term business plans have been laid down to ensure adequacy of the control system, adherence to the management instructions and legal compliances. The Company uses ERP (Enterprise Resource Planning) system to record data for accounting and connects to different locations for efficient exchange of information. This process ensures that all transaction controls are continually reviewed and risks of inaccurate financial reporting, if any, are dealt with immediately.

Material developments in human resources / industrial relations front:

The Company believes that human resource is its most valuable resource which has to be nurtured well so that it is equipped to meet the challenges posed by the changing dynamics of business developments. The Company has a policy of continuous training of its employees both in-house as well as through reputed Institutes. The staff is highly motivated due to good work culture, training, remuneration packages and the values, which the Company maintains.

The total number of people employed in the Company as on 31.03.2013 is 3,970. Your Directors would like to record their appreciation of the efficient and loyal service rendered by the Company''s employees.

Fixed deposits:

Your Company has been inviting and accepting deposits from the public, shareholders and others. The amount of deposits outstanding as on March, 31, 2013 was Rs.7.86 cr. There are no unclaimed deposits, which are transferable to the Investor Education and Protection Fund under Section 205C of the Companies Act, 1956.

Unclaimed dividend

As per the provisions of Section 205C of the Companies Act, 1956, unclaimed dividend amount of Rs.4,82,243 in respect of the year 2004 - 2005 has been transferred to Investor Education and Protection Fund on 27.09.2012 upon expiry of the mandatory seven year period

Banks and Financial Institutions:

The Company has been prompt in making the payment of interest and repayment of loans to the Financial Institutions and interest on working capital to the banks. Banks and financial institutions continue to give their unstinted support. The Board records its appreciation for the same.

Corporate Social Responsibility:

Your Company, as a responsible corporate citizen had established in the year 2000, a Charitable Trust in the name and style of Visaka Charitable Trust as a non-profit entity, to support initiatives that benefit the society at large. The Trust supports programmes devoted to the cause of the destitute, the rural poor by providing the basic necessities of life to them. This has helped to enhance the image of the Company.

The main areas of activity of the Trust include providing drinking water by digging bore wells, construction of irrigation tanks in remote villages, building of class rooms in schools and colleges, reimbursement of salaries of teachers, supply of class room furniture and conducting of health camps.

Directors:

Shri M P V Rao, Whole-time Director is reappointed for a period of two Years with effect from 01.04.2012.

As per Article 120 of the Articles of Association of the Company, Shri Bhagirat B. Merchant, Shri Gusti J. Noria and Shri P. Abraham retire by rotation and being eligible offer themselves for reappointment.

Directors'' Responsibility Statement

As required by the provisions of Section 217(2AA) of the Companies Act, 1956, the Directors'' Responsibility Statement is appended hereto and forms part of this Report.

Corporate Governance

As a listed Company, necessary measures have been taken to comply with the Listing Agreements of Stock Exchanges. A report on Corporate Governance, along with a certificate of compliance from the Auditors, forms part of this Report.

Auditors

M/s. M. Anandam & Co., Chartered Accountants, retires as

Auditors in this Annual General Meeting and are eligible for reappointment.

Cost Auditors

Ministry of Corporate Affairs vide Order No. F. No. 52/26/ CAB - 2010 dated 24th January, 2012 has ordered for auditing of cost records for those industries which are specified in the order. In the said order blended fibres/ Textiles are required to get the cost records audited by a Practicing Cost Accountant or a Firm of Cost Accountants.

M/s. Sagar & Associates, Cost Accountants were appointed as cost auditors of the Company for cost audit of Synthetic Yarn Division of the Company for the financial year 2012 - 2013 who is expected to give his report for the year 2012-2013 by September.

General

The information required under Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 with respect to conservation of energy, technology absorption and foreign exchange earnings/outgo is appended hereto and forms part of this Report.

Information as per Section 217(2A) of the Companies Act, 1956 read with The Companies (particulars of employees) Rules, 1975, as amended, forms part of this Report.

On behalf of the Board of Directors

Date: 20.05.2013 Bhagirat B. Merchant

Place: Secunderabad Chairman

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Mar 31, 2011

The Members,

Visaka Industries Limited

The Directors are pleased to present the 29th Annual Report of the Company with Audited Balance Sheet and Statement of Accounts. The financial highlights are as follows:

(Rs. in lakhs)

Particulars 2010 – 2011 2009 – 2010

Gross Income 66552 63841

Profit for the year before taxation 6829 8637

Provision for taxation 2322 2916

Profit for the year after taxation 4507 5721

Balance brought forward from previous year 1489 696

Profit available for appropriation 5996 6417

Dividend on Equity Share Capital 794 794

Corporate Dividend Tax 132 134

Transfer to General Reserve 3500 4000

Balance carried to Balance Sheet 1570 1489

Dividend

Your Directors Declared Interim Dividend of Rs. 3/- (i.e. 30%) per share of Rs. 10/- each during the Financial Year 2010 -2011. Your Directors recommend payment of Final Dividend of Rs. 2/- (i.e. 20%) Per Share of Rs. 10/- each for the Financial Year ended on 31st March, 2011. With the above the total Dividend Paid will be Rs. 5/- (i.e. 50%) per Share of Rs. 10/- each. The Company is absorbing Corporate Dividend Tax of Rs. 131.89 lakhs on the Equity Dividend and the Dividend declared and paid this year is not taxable in the hands of Shareholders.

Fixed deposits

Your Company has been inviting and accepting deposits from the Public, Shareholders and Others. The amount of deposits outstanding as on March 31, 2011 was Rs. 6.80 Crores. Deposits amounting to Rs. 8.74 Lacs remained unclaimed as on 31.03.2011. There are no unclaimed deposits which are transferable to the Investor Education and Protection Fund under Section 205C of the Companies Act, 1956.

Unclaimed dividend

As per the provisions of Section 205C of the Companies Act, 1956, Unclaimed Dividend amount of Rs. 4,54,173.00 in respect of the year 2002 – 2003 has been transferred to Investor Education and Protection Fund on 19.08.2010 upon expiry of the mandatory 7 years period. Letters have been sent to shareholders in respect of unpaid dividend for the year 2003-2004 advising them to encash their dividend warrants.

Banks and financial institutions

The Company has been prompt in making the payment of interest and repayment of loans to the Financial Institutions and also interest on working capital to the banks. Banks and Financial Institutions continue to give their unstinted support. The Board records its appreciation for the same.

Corporate social responsibility

Your Company, as a responsible Corporate Citizen established in the year 2000 a Charitable Trust in the name and style of Visaka Charitable Trust as a non-profit entity, to support initiatives that benefit the society at large. The Trust supports programs devoted to the cause of destitute, rural poor and providing the basic necessities of life to the rural poor. This has helped to enhance the image of the Company.

Main area of activity of the Trust is to provide Drinking Water by digging bore wells, construction of irrigation tanks in remote villages, building of Class Rooms in Schools and Colleges, reimbursement of salaries of teachers, supply of class room furniture and conducting of health camps.

Directors

As per Article 120 of the Articles of Association of the Company, Shri. Gusti J Noria and Shri. P. Abraham retires by rotation. Shri. Gusti J Noria and Shri. P. Abraham being eligible offers themselves for reappointment.

Directors' responsibility statement

As required by the provisions of Section 217(2AA) of the Companies Act, 1956, the Directors' Responsibility Statement is appended hereto and forms part of this Report.

Corporate governance

As a listed Company, necessary measures have been taken to comply with the Listing Agreements of Stock Exchanges. A report on Corporate Governance, along with a certificate of compliance from the Auditors, forms part of this Report.

Auditors

M/s. M. Anandam & Co., Chartered Accountants, retires as Auditors in this Annual General Meeting and are eligible for reappointment.

General

The information required under Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 with respect to conservation of energy, technology absorption and foreign exchange earnings / outgo is appended hereto and forms part of this Report.

Information as per Section 217(2A) of the Companies Act, 1956 read with The Companies (particulars of employees) Rules, 1975, as amended, forms part of this Report.

On behalf of the Board of Directors

Bhagirat B. Merchant Chairman

Place: Secunderabad Date : 27.05.2011

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Mar 31, 2010

The Directors are pleased to present the 28th Annual Report of the Company with Audited Balance Sheet and Statement of Accounts.

The financial highlights are as follows:

(Rs. in lakbs) Particulars 2009-2010 2008-2009 Gross Income 63841.07 55451.79 Profit for the year before taxation 8636.82 5543.02 Provision for taxation 2915.68 1949.18 Profit for the year after taxation 5721.14 3593.84 Balance brought forward from previous year 695.45 644.81 Profit available for appropriation 6416.59 4238.65 Divisiond on Equity Share Capital 794.05 476.43 Special Silver Jubilee Year Dividend - 158.81 Corporate Dividend Tax 133.72 107.96 Transfer to General Reserve 4000.00 2800.00 Balance carried to Balance Sheet 1488.82 695.45

Dividend

Your Directors declared an interim dividend of Rs. 3 (i.e. 30%) per share of Rs. 10 each during the financial year 2009-2010. Your Directors recommend a payment of final dividend of Rs. 2 (i.e. 20%) per share of Rs. 1 0 each for the financial year ended on 31st March, 2010. With the above, the total dividend paid will be Rs. 5 (i.e. 50%) per share of Rs. 10 each. The Company is absorbing a Corporate Dividend Tax of Rs. 133.72 lakhs on the equity dividend. The dividend declared and paid this year is not taxable in the hands of shareholders.

Management discussion and analysis:

Your Company is in the business of the manufacture and sale of

Asbestos Cement Sheets, V-Boards (Fiber Cement Sheets) and Spinning Yarn.

A. Asbestos cement business

Industry structure and developments: This industry is more than 72 years old industry in India.

Asbestos Cement Products continue to be in demand because of the industrys effort in making inroads into Indias rural markets, affordability and other qualities such as corrosion resistance, weather and fire-proof nature.

Currently there are 1 7 entities in the industry with about 63 manufacturing plants throughout the country. The products are

marketed under their respective brand names mainly through dealers for the retail market and directly for projects and government departments. The total production for the year 2009-2010 was estimated at 42 lakh metric tonnes. The industry demand as measured by the total sales of the industry has been growing considerably over the years, the growth for the last year being 5% i.e sales increased from 39 lakh metric tonnes in 2008-2009 to 41 lakh metric tonnes during the year 2009- 2010.

Opportunities and threats: Asbestos Cement Sheets are mainly used as roofing material in rural and semi-urban housing and by general industries and the poultry sector.

Asbestos Cement Sheets are popular as they are inexpensive, need no maintenance and last long when compared to competing products such as thatched roofs, tiled roofs and galvanised iron sheets.

According to the information gathered by us, almost 80-85% of rural people use thatched roof/tiles for shelter. Thatched roof need regular replacement and tiled roof needs continued maintenance. Therefore, whenever economic conditions improve, the first choice of the rural poor to replace the roof over their head are the affordable and relatively durable Asbestos Cement Sheets. Therefore, we see increased potential for the use of Asbestos Cement Sheets in rural areas.

The Central and State Governments have been giving a lot of thrust for housing for rural poor. Asbestos Cement Sheets are widely used for this purpose.

Both the existing and new manufacturers are venturing into setting up new Asbestos Cement Sheet producing plants and some eight new units are expected to be commenced. This could increase competition and will have an effect on margins. However, being an established company, your Company will have an advantage.

Risks and concerns:

Lack of entry barriers: Lack of entry barriers is attracting new entrants into this line of business. However it takes a lot time for a new entrant to establish in the market.

Increase in input costs: The continuous increase in cost of inputs is a matter of concern. We are confident of passing on increases to customers.

Ban asbestos lobby: The activities of the Ban asbestos lobby instigated by the manufacturers of substitute products continue to be a matter of concern. We are educating users that this is a misrepresentation campaign.

Production and sales volumes:

As against a production of 550438 tonnes during the previous year the production during the financial year ended 31st March 2009 was 6,01,973 tonnes, an increase of 9.00%. Sales during the financial year ended on 31st March 2010 was 5,58,001 tonnes as against 5,85,084 tonnes sold during the preceding year.

Financial performance: The gross turnover of Asbestos Cement Division during the year 2009-2010 was Rs. 502.76 crores as compared to Rs. 479.67 crores during the previous year. The profit before tax for the year was Rs. 77.05 crores as compared to Rs. 57.03 crores in the previous year.

Outlook: As stated earlier, there are still vast number of tiled and thatched roof houses waiting for replacement with durable and affordable roofing. Hence, subject to raw material prices remaining within reasonable limits, the demand for asbestos cement products is expected to remain firm.

Future plans Expansion of Pune project:

For expanded capacity of 1 20,000 TPA Public Hearing was over on 6.1.2010. Environmental clearance is expected by May end, after which we can pursue our expansion.

Asbestos Cement Sheets project at Sambalpur district, Orissa.

After Ministry of Environment and Forests (MOEF) approved our site at Sambulpur, we acquired the land. In the meanwhile for obtaining environmental clearance, a public hearing has been fixed on 12th May 2010. We hope to commence work after MOEF clearance. The plant and machinery for this unit has already been ordered. The contract has been awarded for civil construction work. The proposed capacity of this plant is 21 6,000 tonnes per annum for which MOEF has given Terms of Reference (TOR) clearance.

Boards Division

The total production for the period ended March 2010 was 1 9,1 74 metric tonnes as against a production for the year ended March, 2009 of 1 2,760 metric tonnes. Sales for the year ended on 31st March, 2010 was 16,806 metric tonnes (including export of 1 131 metric tonnes) as against 10,050 metric tonnes sales for the previous year. The turnover from this division was Rs. 1 5.80 crores for the year ended 31st March 201 0 compared to Rs. 9.32 crores in the previous year. This division is expected to make profits in the current year.

Outlook

The market characteristics for cement boards over the coming year look positive because of intense construction activity and shift of consumers from particle boards and plywood to cement reinforced sheets. This is a product of the future.

Sandwiched Panels Unit

Sandwiched Panels are in demand, for use as partition material. The Reinforced Building Board Sandwiched Panels are made of two fibre-reinforced cement sheets enclosing a lightweight core. These panels are fully cured at the factory and ready for installation. These panels are cheaper compared with masonry partitions / wood partitions, are easy to fix and take a comparatively lower time for installation.

The unit commenced commercial production on 1st January, 2010. Commercial production upto 31st March, 2010 was 1021 tonnes and sales was 838 tonnes. Sales turnover was Rs. 1.12 Crores. Our major customers are GMR, Punj Llyod, Shapoorji Pallonji & Co. Ltd., Soma Enterprises, TCS, Gujarat Ambuja Port, Eenadu Group, Coastal Projects Pvt. Ltd., Uranium Corporation, Larsen & Toubro, etc.

B. Synthetic Yarn Business

Industry structure and developments: The demand for Synthetic Yarn was good during the year 2009-201 0 due to high cotton fibre / yarn prices, short supply of yarn due to power cuts in various parts of the country, and a good demand for Indian fabrics in international markets.

Opportunities and threats: The continued growth in GDP and demand for the Indian fabric in the domestic and international market is an opportunity for us. The expected reduction in cotton fiber and yam prices is a threat to the synthetic industry. However, in such a case, we expect synthetic fiber prices to come down.

Risks and concerns: Fluctuating Rupee and crude oil prices are likely to affect the divisions performance. The likely shrinking of demand for Indian fabrics in the international market is a matter of concern. However, since the domestic market is growing, we should be able to cover this.

Outlook: We have introduced several measures to improve performance. Barring unforeseen circumstances, we hope to do better in this Division in the coming year.

Product-wise performance: The production in the spinning unit during the year 2009-2010 was 8,705 metric tonnes as compared to 8,741 metric tonnes during the previous year. The sales were 8,883 metric tonnes of yarn during the year 2009- 2010 as compared to 9,283 metric tonnes in the previous year.

Financial performance: The turnover of this division during 2009-2010 was Rs. 119.61 crores compared to Rs. 117.35 during the previous year. The profit before tax during the year was Rs. 14.97 crores as compared to Rs. 4.32 crores during the previous year, recording an increase of 246%.

Internal control systems and their adequacy:

Your Company has in place adequate systems of internal control commensurate with its size and the nature of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable statutes, safeguarding assets from unauthorised use or losses, executing transactions with proper authorisation and ensuring compliance of internal policies. The Company has a well defined delegation of power with authority limits for approving revenue as well as capital expenditure. Processes for formulating and reviewing annual and long term business plans have been laid down to ensure adequacy of the control system, adherence to the management instructions and legal compliances. The Company uses ERP (Enterprise Resource Planning) system to record data for accounting and connects to different locations for efficient exchange of information. This process ensures that all transaction controls are continually reviewed and risks of inaccurate financial reporting, if any, are dealt with immediately.

Material developments in human resources/ industrial relations

The Company believes that human resource is its most valuable resource which has to be nurtured well and equipped to meet the challenges posed by the dynamics of business development. The Company has a policy of continuous training of employees, both in-house as well as through reputed institutes. The staff is highly motivated due to a good work culture, training, remuneration packages and values, which the Company maintains.

The total number of people employed in the Company as on 31.03.2010 is 3128. Your Directors would like to record their appreciation of the efficient and loyal service rendered by the Companys employees.

Fixed deposits

Your Company has been inviting and accepting deposits from the public, shareholders and others. The amount of deposits outstanding as on 31st March 2010 was Rs. 4.85 crores. Deposits amounting to Rs. 10.65 lakhs remained unclaimed as on 31.03.2010. There are no unclaimed deposits which are transferable to the Investor Education and Protection Fund under Section 205C of the Companies Act, 1 956.

Unclaimed dividend

As per the provisions of Section 205C of the Companies Act, 1956, Unclaimed Dividend amount of Rs. 4,27,321.00 in respect of the year 2001-2002 has been transferred to the Investor Education and Protection Fund on 22.08.2009 upon the expiry of seven years period.

Banks and financial institutions

The Company has been prompt in making the payment of interest and repayment of loans to financial institutions and also interest on working capital to banks. Banks and financial institutions continue to give their unstinted support. The Board records its appreciation for the same.

Corporate Social Responsibility

Your Company, as a responsible corporate citizen established in the year 2000 a charitable trust in the name of Visaka Charitable Trust as a non-profit entity, to support initiatives that benefit society at large. The Trust supports programs devoted to the cause of destitute and in providing the basic life necessities to the rural poor. This has helped enhance the image of the Company.

The main activity of the Trust is to provide drinking water by digging bore wells, construction of irrigation tanks in remote villages, building class rooms in schools and colleges, reimbursement of salaries of teachers, supply of class room furniture and conducting health camps.

Directors

Dr. G. Vivekanand stepped down as Managing Director effective from 26th October, 2009. The Board records deep appreciation for the services rendered by Dr. G. Vivekanand. He has now been re-designated as Non-Executive Vice Chairman of the Company.

The Board welcomes Smt. G. Saroja Vivekanand as Managing Director.

As per Article 120 of the Articles of Association of the Company, Shri B. B Merachant and Shri V. Pattabhi retire by rotation. Shri Bhagirath B. Merchant and Shri V. Pattabhi being eligible offers themselves for reappointment.

Directors Responsibility Statement

As required by the provisions of Section 217(2AA) of the Companies Act, 1956, the Directors Responsibility Statement is appended hereto and forms part of this Report.

Corporate Governance

As a listed Company, necessary measures have been taken to comply with the Listing Agreements of Stock Exchanges. A report on Corporate Governance, along with a certificate of compliance from the Auditors, forms part of this Report.

Auditors

M/s. M. Anandam & Co., Chartered Accountants, retire as Auditors in this Annual General Meeting and are eligible for reappointment.

General

The information required under Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 with respect to conservation of energy, technology absorption and foreign exchange earnings / outgo is appended hereto and forms part of this Report.

Information as per Section 21 7(2A) of the Companies Act, 1 956 read with The Companies (particulars of employees) Rules, 1 975, as amended, forms part of this Report.

On behalf of the Board of Directors Place: Secunderabad Bhagirath B. Merchant Date: 10.05.2010 Chairman