Sree Sakthi Paper Mills Limited

SREE SAKTHI PAPER MILLS LIMITED CIN:L93000KL1991PLC006207 Regd Office : “Sree Kailas”,57/2993-94, Paliam Road, Ernakulam, Cochin- 682 016 Phone: (0484) 2382182, E-mail: [email protected]

03 October 2018

Department of Corporate Services, The Bombay Stock Exchange Ltd, P J Towers, Dalal Street, Mumbai – 400 001

Dear Sir,

Sub: Submission of Annual Report pursuant to Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015

Pursuant to the provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulation 2015, please find enclosed the Annual Report for the financial year ended 31st March, 2018, which has been duly approved and adopted by the members of the Company as per the provisions of the Companies Act, 2013 at the 27th Annual General Meeting of the Company held on Saturday, 29th September, 2018.

Kindly take the same into your records.

Thanking you,

Yours Faithfully, For Sree Sakthi Paper Mills Ltd

R. Ponnambalam Company Secretary

Encl: as above.

SREE SAKTHI PAPER MILLS LIMITED

27TH ANNUAL REPORT 2017-18

BOARD OF DIRECTORS Dr. S. Rajkumar, Vice Chairman & Managing Director Mrs. RajeeRajkumar, Non-Executive Director Mr. S. Subramoniam, Non- Executive Director Mrs. E. Kamalam, Women Director Mr. G. Raghavan, Independent Director Mr. N. Subramanian, Independent Director Mr. U. GururajaBhat, Independent Director Mr. AkhileshAgarwal – Non-Executive Director

CHIEF FINANCIAL OFFICER Mr. V.N. Sridharan

COMPANY SECRETARY Mr. R. Ponnambalam

AUDITORS

M/s. KPR& Co. CONTENTS 31/181 D, Anantha, Mahakavi G. Road Karikkamuri, Cochin - 682 011 Corporate Information 1 BANKERS Financial Highlights 2 Federal Bank Limited IDBI Bank Limited Notice 3-12 State Bank of India

Directors’ Report 13-53 REGISTERED OFFICE 57/2993, “Sree Kailas” Paliam Road Ernakulam, Cochin - 682 016, Kerala Independent Auditor’s Report 54-60 Tel: 0484-3002000 Fax: 0484-2370395 E-mail:[email protected] Balance Sheet 61 Web: www.sreekailas.com

Statement of Profit & Loss 62 FACTORIES Kraft Paper Unit 1 and 2 (Closed in June 2016) Notes on Financial Statements 63-91 Industrial Development Area Muppathadom, Edayar, Aluva - 683 102

Cash Flow Statement 92

Form AOC - 1 93-94

Independent Auditor’s Report 95-98 on Consolidated Financial Statements

Consolidated Financial Statements 99-129

FINANCIAL HIGHLIGHTS (8 YEARS) Rs. In lakhs

Particulars 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18

Sales (Gross) 19,081.81 20,837.99 21,766.94 21,554.41 16,405.45 10,698.82 2,400.67 26.89

Sales (Net) 18,292.83 19,792.31 20,505.57 20,306.81 15,559.7 10,140.09 2,782.31 27.25

Total Income 18,356.74 19,837.31 20,565.49 20,443.01 15,660.39 10,212.02 2,894.05 1,156.48

Profit before tax 1,052.75 1,023.57 702.9 143.26 -1,528.71 -1,762.8 -4,244.94 -1,039.82

Profit after tax 701.333 660.33 469.12 116.08 -1,178.14 -1,694.95 -3,658.14 -767.43

Earnings per Share 4.27 4.02 2.85 0.071 -7.79 -11.14 -23.08 -5.43

Dividend Rate (%) 21 21 15 6 - - - -

Reserves & Retained Earnings 2,309.61 2,568.79 2,749.47 2,750.18 1,509.61 -185.33 -3,843.47 -4,431.65

Share Capital 1,643.62 1,643.62 1,643.62 1,643.62 2,643.62 2,643.62 2,643.62 1,729.62

Shareholders’ Funds 3,953.24 4,212.41 4,393.09 4,393.08 4,253.23 2,458.29 -1,199.85 -2,702.03

Fixed Assets(Gross Block) 7,748.46 10,357.61 10,838.2 10,985.32 11,182.37 9,192.51 1,638.70 1,069.51

Fixed Assets(Net Block) 5,287.67 7,472.88 7,451.11 7,145.04 5,835.68 5,502.81 965.80 770.11

NOTICE

Notice is hereby given that the 27th Annual General Meeting of (Rs. Lacs) the Company will be held on Saturday 29th September, 2018 at 2.00 p.m, at Hotel Abad Plaza M.G.Road, Ernakulam, Cochin - 35 to transact the following business. Visakh Repairs and Mr.S.Rajkumar Homes Modification holds the ORDINARY BUSINESS Limited for Warehouse directorship 250.00

1. To receive, consider and adopt the audited financial Visakh Commission for Mr.S.Rajkumar statements (both standalone and consolidated financial Homes marketing holds the statements) for the financial year ended 31st March, 2018 and Limited warehouse directorship 100.00 the Report of the Board of Directors and Auditors thereon.

2. To appoint a Director in place of Mr. Subramoniam Sivathanupillai (DIN-01790968), Director, who retires by rotation 5. Change in name of the company in accordance with section 152 of the Companies Act, 2013 and being eligible, offers himself for re-appointment. To consider & if thought fit, to pass, with or without modification(s), following resolution as SPECIAL RESOLUTION: SPECIAL BUSINESS “RESOLVED THAT pursuant to Section 13 and all other applicable 3. Regularisation of Mrs. Rajee Rajkumar (DIN: 363280) as provisions, if any, of the Companies Act, 2013 (including any Director of the Company statutory modification or re-enactment thereof, for the time being in force) and Rule 29 of the Companies (Incorporation) To consider and if thought fit, to pass with or without Rules, 2014, subject to approval of the Central Government modification(s), the following resolution as an Ordinary (power delegated to Registrar of Companies) and any other Resolution: Regulatory Authorities as may be necessary, consent of the members be and are hereby accorded to change the name of the "RESOLVED THAT pursuant to the provisions of Section 161(1) of Company from “SREE SAKTHI PAPER MILLS LIMITED” to “CELLA the Companies Act, 2013 and Articles of Association of the SPACE LIMITED” as may be approved by the Central Government, company, Mrs. RajeeRajkumar (DIN: 363280) who was appointed Registrar of Companies, Kerala and other Regulatory Authorities, as an Additional Director at the meeting of the Board of Directors whether under the Companies Act, 2013 or any other Rules, nd of the Company held on 2 February, 2018and whose term Laws, Acts, Statutes or Regulations as may be applicable to the expires at the ensuing Annual General Meeting of the company Company. and be and is hereby appointed as a Director of the Company whose period of office will be liable to determination by FURTHER RESOLVED THAT the Name Clause being Clause I in the retirement of directors by rotation"..” Memorandum of Association of the Company be altered accordingly and substituted by the following clause: 4. Approval for related party transactions I. The Name of the Company is CELLA SPACE LIMITED. To consider and if thought fit, to pass with or without modification(s), the following resolution as an Ordinary FURTHER RESOLVED THAT in terms of Section 14 of the Resolution: Companies Act, 2013 the Articles of Association of the Company be altered by deleting the existing name of the Company “RESOLVED THAT pursuant to the provisions of Section 188 and wherever appearing and substituting it with the new name of the other applicable provisions of the Companies Act, 2013 read with Company. the rules made there under (including any statutory modification(s) or re enactment thereof for the time being in FURTHER RESOLVED THAT the Board of Directors or any force), the consent of the Company be and is hereby accorded to Committee thereof be and is hereby authorized to accept any enter into the related party transactions by the Company with other name approved by the relevant Regulatory Authorities and the respective related parties and for the maximum amounts per seek approval for the change in the name of the Company annum for the financial year 2018-19 as mentioned herein below: accordingly without making any further reference to the members for their approval.” Particulars Nature of Nature of Annual of Parties Transaction Relationship Amount

6. To re-appoint Dr. S. Rajkumar (DIN 01790870) as Managing NOTES: Director. 1. A MEMBER ENTITLED TO ATTEND AND VOTE, AT THE To consider and if thought fit, to pass, with or without MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND modification the following resolution as an Ordinary Resolution VOTE INSTEAD OF HIMSELF AND THE PROXY NEED NOT BE A MEMBER OF THE COMPANY. “RESOLVED THAT in accordance with the provisions of Sections 196, 197 and 203 read with Schedule V and all other applicable 2. The instrument appointing proxy (duly completed, stamped provisions, if any, of the Companies Act, 2013 and the Companies and signed) in order to be effective must be deposited at the (Appointment and Remuneration of Managerial Personnel) Rules, registered office of the company not less than 48 hours before 2014 (including any statutory modification(s) or re-enactment the commencement of the 27th Annual General Meeting of the thereof, for the time being in force) and subject to such consents Company. and permissions, as may be required, approval of the Members of the Company be and is here accorded for re-appointment Dr. 3. Corporate Members intending to send their authorised S. Rajkumar (holding DIN 01790870), as the Managing Director of representatives to attend the Meeting are requested to send a the Company, for a period of 1 (One) years with effect from 13th duly certified copy of Board Resolution on the letterhead of the August, 2018, on such terms and conditions as set out in this Company, signed by one of the Directors or Company Secretary resolution and the explanatory statement annexed hereto and or any other authorized signatory and / or duly notarized Power payment of such remuneration, as may be determined by the of Attorney, authorizing their representatives to attend and vote Board or a duly constituted Committee thereof, from time to on their behalf at the Meeting. time, within the maximum limits of remuneration for Managing 4. With effect from 1st April 2014, inter alia, provisions of Section Director approved by the Members of the Company . 149 of Companies Act, 2013 has been brought into force. In 7.Appointment of Mr. UliarGururajaBhat (DIN 00353361) as an terms of the said section read with section 152 (6) of the Act, the Independent Director provisions of retirement by rotation are not applicable to Independent Directors. Profile of directors seeking re- To consider and if thought fit, to pass with or without appointment as stipulated in terms of Securities and Exchange modification(s), the following resolution as anSpecial Resolution: Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 with the stock exchanges is provided in the “RESOLVED THAT pursuant to the provisions of Sections 149 and report on corporate governance, which forms an integral part of 152 read with Schedule IV and other applicable provisions, if any, this annual report. of the Companies Act, 2013 (“the Act”) and the Companies (Appointment and Qualification of Directors) Rules, 2014 and the 5. The Register of Members and Share Transfer books of the applicable provisions of the Securities and Exchange Board of Company will remain closed from 20-09-2018 to 29-09-2018 India (Listing Obligations and Disclosure Requirements) (both days inclusive). Regulations, 2015 (including any statutory modification(s) or re- enactment(s) thereof, for the time being in force), Mr. 6. All documents referred to in the accompanying Notice and the UliarGururajaBhat (holding DIN 00353361), who was appointed Explanatory Statement shall be open for inspection at the as an Independent Director and who holds office of Independent Registered Office of the Company during normal business hours Director up to the date of this Annual General Meeting and being (9.30 am to 5.30pm) on all working days except Saturdays, up to eligible, and in respect of whom the Company has received a and including the date of the Annual General Meeting of the notice in writing under Section 160 of the Act from a member Company. proposing his candidature for the office of Director, be and is 7. Shareholders are requested to bring their copy of the Annual hereby re-appointed as an Independent Director of the Company, Report to the meeting. not liable to retire by rotation and to hold office for a second term of 5 (five) consecutive years on the Board of the Company.” 8. Members/Proxies should fill the attendance slip for attending the Meeting. By order of the Board of Directors For SreeSakthi Paper Mills Limited 9. Members who hold shares in dematerialized form are required Sd/- to write their client ID and DPID numbers, and those who hold Chennai -17 R. Ponnambalam shares in physical form are requested to write their Folio number August 13, 2018 Company Secretary in attendance slip for attending the meeting.

10. The information on the Directors appointment or years from the due date is required to be transferred to the reappointment is provided as per Securities and Exchange Board Investor Education and Protection Fund (IEPF), constituted by the of India (Listing Obligations and Disclosure Requirements) Central Government. The details of Unclaimeddividend /Interest Regulations, 2015 and is given in the Corporate Governance transferred to IEPF for the last 10 years are as follows. Section of this Annual Report.

11. Under the provisions of the Companies Act, 2013, the amount of dividend remaining unpaid or unclaimed for a period of seven

Date/Due date of transfer to IEPF Year Dividend / interest(Rs.) Date of filing of form INV-1/IEPF-1 a/c

2007-08 1,34,835 04-12-2015 04-12-2015

2008-09 1,50,087 04-05-2017 11-05-2017

2009-10

Interim 1,63,742 29.06.2017 21-07-2017

Final 91,098 09.10.2017 NA

2010-11

Interim 1,02,524 01.01.2018 NA

Final 1,12,650.2 02.10.2018 NA

2011-12 2,15,111.7 02.09.2019 NA

2012-13 1,49,506.5 12.10.2020 NA

2013-14 1,05,349.2 31.10.2021 NA

2014-15 Not declared NA

2015-16 Not declared NA

2016-17 Not declared NA

Those members who have not encashed their dividend warrants holding shares in electronic form are, therefore, requested to for the financial year 2010-11 onwards may lodge a claim with submit their PAN to their Depository Participant(s). Members the Company immediately especially relating to the year 2010-11 holding shares in physical form shall submit their PAN details to as the unpaid dividend for the said year is due to be remitted into the Company / M/s. Bigshare Services Pvt. Ltd I.E.P Fund by 02ndOctober, 2018. 14. Members holding shares in electronic form are requested to 12. Copies of the Annual Report 2018 are being sent by electronic intimate immediately any change in their address or bank mode only to all the members whose email addresses are mandates to their Depository Participants with whom they are registered with the Company / Depository Participant(s) for maintaining their demat accounts. Members holding shares in communication purposes unless any member has requested for a physical form are requested to advise any change in their address hard copy of the same. For members who have not registered or bank mandates immediately to the Company / M/s. Bigshare their email addresses, physical copies of the Annual Report 2018 Services Pvt. Ltd. are being sent by the permitted mode. 15. A Statement pursuant to Section 102 (1) of the Companies 13. The Securities and Exchange Board of India (SEBI) has Act, 2013 relating to Special Business to be transacted at the mandated the submission of the Permanent Account Number meeting is annexed hereto. (PAN) by every participant in the securities market. Members 5

16. Information and other instructions relating to e-voting are www.evotingindia.com. The results shall simultaneously be as under: communicated to the Stock Exchanges.

(i) Pursuant to the provisions of Section 108 and other applicable (x) Subject to receipt of requisite number of votes, the provisions, if any, of the Companies Act, 2013 and the Companies Resolutions shall be deemed to be passed on the date of the (Management and Administration) Rules, 2014, as amended and Meeting, i.e. 29thSeptember , 2018. Regulation 44 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, (xi) Instructions and other information relating to remote e- 2015 the Company is pleased to provide to its members facility to voting: exercise their right to vote on resolutions proposed to be passed a) The shareholders should log on to the e-voting website in the Meeting by electronic means. The members may cast their www.evotingindia.com. votes using an electronic voting system from a place other than b) Click on Shareholders. the venue of the Meeting (‘remote e-voting’). c) Now Enter your User ID (ii) The members who have cast their vote by remote e-voting may also attend the Meeting but shall not be entitled to cast i. For CDSL: 16 digits beneficiary ID, their vote again. ii. For NSDL: 8 Character DP ID followed by 8 Digits Client ID, (iii) The Company has engaged the services of Central Depository iii. Members holding shares in Physical Form should Services Limited (“CDSL”) as the Agency to provide e-voting enter Folio Number registered with the Company. facility. d) Next enter the Image Verification as displayed and Click on Login. (iv) TheBoard of Directors of the Company has appointed Mr. e) If you are holding shares in demat form and had logged Adv. Vijayaraghavan, as Scrutinizer to scrutinize the Venue Voting on to www.evotingindia.com and voted on an earlier and remote e-voting process in a fair and transparent manner voting of any company, then your existing password is and they has communicated their willingness to be appointed to be used. and will be available for same purpose. f) If you are a first time user follow the steps given below:

(v) Voting rights shall be reckoned on the paid-up value of shares registered in the name of the member / beneficial owner (in case of electronic shareholding) as on the cut-off date i.e. 20/09/2018

(vi) A person, whose name is recorded in the register of members or in the register of beneficial owners maintained by the depositories as on the cut-off date, i.e. 20/09/2018 only shall be entitled to avail the facility of remote e-voting / Venue Voting.

(vii) The voting period begins on 26/09/2018 at 09.00 AM and ends on 28/09/2018 at 05.00 PM. During this period shareholders’ of the Company, holding shares either in physical form or in dematerialized form, as on the cut-off date (record date) of 20/09/2018 may cast their vote electronically. The e- voting module shall be disabled by CDSL for voting thereafter.

(viii) Shareholders who have already voted prior to the meeting date would not be entitled to vote at the meeting venue.

(ix) The Scrutinizer, after scrutinizing the votes cast at the meeting and through remote e-voting, will, not later than three days of conclusion of the Meeting, make a consolidated scrutinizer’s report and submit the same to the Chairman. The results declared along with the consolidated scrutinizer’s report shall be placed on the website of the Company www.sreekailas.com and on the website of CDSL For Members holding shares in Demat Form and Physical Form

PAN Enter your 10 digit alpha-numeric PAN issued by Income Tax Department (Applicable for both demat shareholders as well as physical shareholders)

 Members who have not updated their PAN with the Company/Depository Participant are requested to use the first two letters of their name and the 8 digits of the sequence number in the PAN field.  In case the sequence number is less than 8 digits enter the applicable number of 0’s before the number after the first two characters of the name in CAPITAL letters. Eg. If your name is Ramesh Kumar with sequence number 1 then enter RA00000001 in the PAN field. Dividend Bank Details Enter the Dividend Bank Details or Date of Birth (in dd/mm/yyyy format) as recorded in your demat account OR Date of Birth (DOB) or in the company records in order to login.  If both the details are not recorded with the depository or company please enter the member id / folio number in the Dividend Bank g) After entering these details appropriately, click on “SUBMIT” tab. h) Members holding shares in physical form will then directly reach the Company selection screen. However, members holding shares in demat form will now reach ‘Password Creation’ menu wherein they are required to mandatorily enter their login password in the new password field. Kindly note that this password is to be also used by the demat holders for voting for resolutions of any other company on which they are eligible to vote, provided that company opts for e-voting through CDSL platform. It is strongly recommended not to share your password with any other person and take utmost care to keep your password confidential. i) For Members holding shares in physical form, the details can be used only for e-voting on the resolutions contained in this Notice. j) On successful login, the system will prompt you to select the E-Voting Sequence Number for SreeSakthi Paper Mills Limited. k) On the voting page, you will see “RESOLUTION DESCRIPTION” and against the same the option “YES/NO” for voting. Select the option YES or NO as desired. The option YES implies that you assent to the Resolution and option NO implies that you dissent to the Resolution. l) Click on the “RESOLUTIONS FILE LINK” if you wish to view the entire Resolution details. m) After selecting the resolution you have decided to vote on, click on “SUBMIT”. A confirmation box will be displayed. If you wish to confirm your vote, click on “OK”, else to change your vote, click on “CANCEL” and accordingly modify your vote. n) Once you “CONFIRM” your vote on the resolution, you will not be allowed to modify your vote. o) You can also take a print of the votes cast by clicking on “Click here to print” option on the Voting page. p) If a demat account holder has forgotten the login password then Enter the User ID and the image verification code and click on Forgot Password & enter the details as prompted by the system.

(xiii) Note for Non – Individual Shareholders and Custodians

a) Non-Individual shareholders (i.e. other than Individuals, HUF, NRI etc.) and Custodian are required to log on to www.evotingindia.com and register themselves as Corporates. b) A scanned copy of the Registration Form bearing the stamp and sign of the entity should be emailed to [email protected]. c) After receiving the login details a Compliance User should be created using the admin login and password. The Compliance User would be able to link the account(s) for which they wish to vote on. d) The list of accounts linked in the login should be mailed to [email protected] and on approval of the accounts they would be able to cast their vote. e) A scanned copy of the Board Resolution and Power of Attorney (POA) which they have issued in favour of the Custodian, if any, should be uploaded in PDF format in the system for the scrutinizer to verify the same. f) In case you have any queries or issues regarding e-voting, you may refer the Frequently Asked Questions (“FAQs”) and e-voting manual available at www.evotingindia.com, under help section or write an email to [email protected] / Toll Free No: 18002005533.

By order of the Board of Directors For Sree Sakthi Paper Mills Limited

Sd/- Chennai -17 R. Ponnambalam August 13, 2018 Company Secretary Information for reappointment / appointment of Directors as required under Regulation 36 of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 7

Name of Director Date of Birth Date of Appointment Share holding in the Co. (Nos.)

Mr. S Subramoniam 28.05.1957 03.08.1995 -

Qualification: Graduate

Experience:Experience More than 27 years experience in cement and transport business. He is in the Board of the Company since 1995

Details of Directorship in other companies – SreeSakthi Constructions & Infrastructure Ltd, Sree Kailash Palchuram Hydro Power Limited, SreeAdisakthiMukkuttathode Hydro Power Limited and Jalashaayi Alamparathode Hydro Power Limited

Status in other Board Committees of the company – NIL

Relationships between directors inter-se:-

Son of Ms. E Kamalam& Brother of Dr. Rajkumar, Directors of the Company

Name of Director Date of Birth Date of Appointment Share holding in the Co. (Nos.)

Mrs. RajeeRajkumar 10.06.1969 02.02.2018 285544

Qualification: Graduate

Experience: Has been involved in the activities of the Company for the past 10 years

Details of Directorship in other companies – ShriKailash Logistics (Chennai) Limited

Status in other Board Committees of the company – NIL

Relationships between directors inter-se:-

Wife of Mr. S.Rajkumar, Managing Director of the Company

Name of Director Date of Birth Date of Appointment Share holding in the Co. (Nos.)

Mr. S. Rajkumar 15.10.1958 11.07.2011 84,52,995

Qualification: Post Graduation

Experience

Dr. S. Rajkumar has been in the service of the Company as Managing Director since the incorporation of the Company in 1991. He has been instrumental in setting up of Kraft paper unit at Edayar which commenced the commercial production in the year 1993 and Duplex Board unit at Chalakudy which commenced the commercial production in the year 1995. Besides he has taken considerable strain and responsibility in setting up the 3rd unit at Edayar which commenced commercial production in the year 2007. For setting up this 3rd unit he has successfully mobilised Funds through public issue of shares and Company’s shares were listed in BSE. Dr S. Rajkumar is 60 years old and has wide experience in marketing management and administration and has in depth knowledge of Paper Industry. Over the last 27 years he has steered the Company successfully and consistently made profits even when the Paper industry is facing depressed conditions by adopting cost control measures. Since the inception of the Company he has taken effective steps to increase the production capacity gradually and under his leadership Company has reached as one of the leading manufacturers of Kraft Paper in South India with installed capacity of 85000 MT per year.

Details of Directorship in other companies –Sree Kailash Palchuram Hydro Power Limited, SreeAdisakthiMukkuttathode Hydro Power

Limited and JalashaayiAlamparathode Hydro Power Limited, Shree Sakthi Industrial Park Limited, Visakh Homes Limited, ShriKailash Logistics (Chennai) Limited.

Status in other Board Committees of the company – Chairperson of the Stakeholders Relationship Committee, Chairperson of CSR Committee, Chairperson of Share Allotment Committee

Relationships between directors inter-se

Son of Mrs. E Kamalam, Brother of Mr. S Subramoniam, Directors and Husband of Mrs. RajeeRajkumar, Director of the Company

Name of Director Date of Birth Date of Appointment Share holding in the Co. (Nos.)

Mr. U. GururajaBhat 15.04.1938 23.02.2017 50

Qualification - Graduate in Science & Mathematics and Degree in Mechanical Engineering

Experience: Twenty Five (25) years experience in Paper Mill Maintenance, Projects covering Development Activities and Expansion of the mill involving Engineering, procurement and construction activities – Thirty Two (32) years experience in Managing large scale projects involving co-ordination of all phases of engineering, procurement, construction, start up and commencing activities of pulp & paper Mills in India.

Details of Directorship in other companies - Emami Paper Mills Ltd., SPB Projects & Consultants Limited

Status in other Board Committees of the company

Member of the Audit Committee and Nomination, Shareholders relation Committee, Risk Management Committee and Remuneration Committee

Relationships between directors inter-se- Not related to any other directors of the Company.

ROUTE MAP TO REACH THE VENUE OF ANNUAL GENERAL MEETING Venue: Hotel Abad Plaza, M.G. Road, Cochin - 35

EXPLANATORY STATEMENT IN RESPECT OF THE SPECIAL BUSINESS PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013

Item No. 3 f) such related party's appointment to any office or place of profit in the company, its subsidiary company or nd The Board of Directors of the Company on 2 February 2018, associate company; and have appointed Mrs. RajeeRajkumar (DIN:00363280) as g) underwriting the subscription of any securities or Additional Director of the Company , in terms of Section 161 of derivatives thereof, of the company the Companies Act, 2013. Pursuant to Section 161 of the Companies Act, 2013 the above director holds office up to the In the light of provisions of the Companies Act, 2013, the Board date of theensuing Annual General Meeting. In this regard the of Directors of your Company has approved the proposed Company has received notice in writing from a member along transactions along with annual limit that your Company may with the deposit of requisite amount under section 160 of the enter into with the related parties (as defined under section 2(76) Act, proposing the candidature of Mrs. RajeeRajkumar for the of the Companies Act, 2013) office of Director of the Company, to be appointed as such under the provisions of Section 152 of the Companies Act, 2013. The particulars of the transaction pursuant to the provisions of Section 188 and the Companies (Meetings of Board and its The Company has received (i) consent in writing to act as Director Powers) Rules, 2014 are as under: in Form DIR 2 pursuant to Rule 8 of the Companies (Appointment & Qualification of Directors) Rules, 2014; (ii) intimation in Form Transactions, requires that for entering into any contract or DIR 8 pursuant to Rule 14 of the Companies (Appointment & arrangement as mentioned herein below with the related party, Qualification of Directors) Rules, 2014 from Mrs. the Company must obtain prior approval of the Board of RajeeRajkumarto the effect that he is not disqualified in Directors and in case of the Company, prior approval of the accordance with sub-section (2) of Section 164 of the Companies shareholders by way of an Ordinary Resolution must be obtained Act, 2013. in case of transactionsexceeding 10% of the turnover of the Companyexceeding 10% of the net worth of the A copy of the draft letter of appointment, setting out the terms Companyexceeding 10% of the networth; or exceeding 10% of and conditions of appointment of Mrs. RajeeRajkumar, is turnover of the company; or 100 crores whichever is lower. available for inspection, without any fee, by the members at the Company’s registered office during normal hours on working days exceeding 10% of turnover or; Rs.50 crores whichever is up to the of the AGM. lower

Mrs. RajeeRajkumar holds 285544 equity shares in the Company. Monthly remuneration exceeding Rs. Two and half Mr. Rajkumar, Mr. S. Subramoniam and Mrs. E.Kamalam being lakhs related to Mr. RajeeRajkumar interested in the resolution exceeding 1% of net worth. mentioned in item no.03 of the notice. None of the other directors of the Company is in any way concerned or interested in (1) Name of the Related Party: the resolution. Accordingly, yours Directors recommend this resolution for your approval. (2) Name of the Director or Key Managerial Personnel who is related, if any: As provided in table below Item No. 4 (3) Nature of Relationship: The Companies Act, 2013 aims to ensure transparency in the transactions and dealings between the related parties of the (4) Nature, material terms, monetary value and particulars of the Company. The provisions of Section 188(1) of the Companies Act, contract or arrangement: The details are as mentioned below: 2013 that govern the Related Party:

a) Sale, purchase or supply of any goods or materials b) Selling or otherwise disposing of, or buying, property of any kind c) Leasing of property of any kind

d) Availing or rendering of any services

e) appointment of any agent for purchase or sale of goods, materials, services or property;

(Rs. In Lakhs) Sl.No Particulars of Parties Nature of Transaction Nature of Relationship Proposed Amount . per annum

1 Repairs and Modification for Mr.S.Rajkumar holds the Visakh Homes Limited Warehouse directorship 250.00

2 Commission for marketing Mr.S.Rajkumar holds the Visakh Homes Limited warehouse directorship 100.00

The Company is in existence more than twenty years and major the Company has obtained Shareholders approval by way of related party transactions developed over the years are generally Postal Ballot to alter the Main Object Clause of the Memorandum with its associates. The related party transactions are entered of Association of the company so as to enable the company to into based on consideration of various business exigencies such carry on the above business. as synergy in operations and sale and transport of finished goods and also keeping in view of Company’s long term strategy for The name of the company is desired to be changed to reflect the assured supply of raw material-waste paper and dispatch of true nature of the Business. Therefore the Board of directors finished goods without any hindrance. have decided to change the name of the Company from “SREE SAKTHI PAPER MILLS LIMITED” to “CELLA SPACE LIMITED”. The respective agreements are negotiated on arm’s length basis and are intended to further the Company’s interests. The Board The proposed change of name will not affect any of the rights of had considered all relevant factors in entering into the the Company or of the shareholders/stakeholders of the arrangements. Company. All existing share certificates bearing the current name of the Company will, after the change of name, continue to be The Copies of the above mentioned existing agreements shall be valid for all purposes. available for inspection by the members at the Registered Office of the Company during the normal business hours (10 am to 5.30 As per the provisions of Sections 13 of the Companies Act, 2014, pm) on all working days (except Saturdays) upto the date of approval of the shareholders is required to be accorded for Annual General Meeting of the Company. changing the name of the Company & consequent alteration in the Memorandum of Association and Articles of Association by The members are further informed that no member/s of the way of passing a Special Resolution. Company being a related party or having any interest in the contract or arrangement as set out at item No. 04 shall be Hence, the resolution is put up for shareholders approval. entitled to vote on this special resolution. None of the directors, Key Managerial Personnel and their The Board of Directors recommends the resolution set forth in relatives is concerned or interested in the aforesaid resolution, item No. 04 for approval of the Members. except to the extent of their shareholding in the Company, if any.

Except the Directors and their relatives (to the extent of their Item No. 6 interest in each contract as specified above), no other director or Dr. S. Rajkumar is Managing Director of the Company since Key Managerial Personnel or their relatives, is concerned or inception and his last tenure of appointment was for a period of interested, financially or otherwise, in passing of this resolution. 01 years w.e.f. 14.08.2017 to 13.08.2018. At the meeting of th Item No. 5 Board of directors of the company held on 13 August 2018, it was decided to reappoint Dr. S. Rajkumar as Managing Director The members may note that the Paper manufacturing Unit I & II for further period from the expiry date of the present tenure. at Edayar was closed down in June, 2016 in pursuance of th Pollution Control Board order. The Board of Directors of the The Nomination and Remuneration Committee had met on 13 Company considered the feasibility report for resuming August 2018 and after evaluating as required under the production activities but found it not viable. Therefore the Board provisions of new Companies Act, 2013 has recommended the re of Directors have decided to discontinue the paper operations appointment of Dr S. Rajkumar as Managing Director for a period th and to diversify into a new line of business viz., logistics, of one year from 14 August, 2018 and lieu of company running warehousing, cold storage and industrial parks. In this connection 11 in loss and considering the financial constraints recommended G Bhat eminent personalities in his respective fields. Your Board NIL remuneration. considers that his continued association with the Company would be of immense benefit to the Company. In view thereof, your Term and conditions of his appointment are as under; Board has recommended him to be classified as Independent Director. 1.Tenureof office: One year The classification of the aforementioned director also as wef 14/8/2018 to Independent Directors pursuant to Section 149 of the Companies Act, 2013 read with Rules made thereunder, with his respective 13/8/2019 term of office to be for respective periods as mentioned in the 2. Salary & Perquisites : NIL resolutions years with effect from this Annual General Meeting.

Concerned Director is interested in his respective resolutions being related to his own appointment. Other than the aforesaid, none of the Directors and Key Managerial Personnel of the Mr.S.Subramoniam, Mrs.RajeeRajkumar and MrsE.Kamalam Company and their relatives are concerned or interested in the being related to Dr. S. Rajkumar interested in the resolution resolutions as set out in item Nos. 7 of the accompanying notice. mentioned in item no.06 of the notice. None of the other directors of the other directors of the Company is in any way None of the directors are related inter se to each other. This concerned or interested in the resolution. Accordingly, yours explanatory statement may also be regarded as a disclosure Directors recommend this resolution for your approval. under clause 49 of the listing agreement with the Stock Exchange. By order of the Board of Directors Item No. 7 For SreeSakthi Paper Mills Limited Your Board is of the opinion that Mr. U G Bhat, Director fulfill the Sd/- conditions specified in the Act for reappointment as Independent Chennai -17 R. Ponnambalam Directors of the Company. Details in respect of director who are August 13, 2018 Company Secretary proposed to be appointed as Independent Director, is furnished in the Corporate Governance section of the Annual Report. Mr.U

DIRECTOR’S REPORT SUBSIDIARY COMPANIES

Your Directors have pleasure in presenting their 27th Annual Report and As of 31st March 2018, your Company has 3 subsidiaries viz. Sree Kailas the Audited Financial Statements of the Company for the year ended 31st Palchuram Hydro Power Limited, Sree Adi sakthi Mukkuttathode Hydro March 2018. Power Limited and Jalashaayi Alamparathode Hydro Power Limited by virtue of the Company having control on the Board of these companies. FINANCIAL PERFORMANCE Steps are being initiated to implement the project with the assistance of Government / Private parties. Pursuant to the provisions of Section 129(3) Brief Financial Highlights with comparison of previous financial year are as of the Act, a statement containing salient features of the financial follows: statements of your Company’s Subsidiaries in Form AOC-1 is attached to the Financial Statements of your Company. ( Rs. Lacs) Particulars For the year For the year Annual accounts of the subsidiary companies and the related detailed ended ended information would be sent to those shareholders seeking information in 31.03.2018 31.03.2017 this regard at any point of time. Further annual accounts of the subsidiary Sales (Gross) 26.89 2289.26 companies would be available for inspection by any shareholders at the registered office of the company. Add: Excise Duty 0.36 111.41 DIVIDEND& RESERVES Sales (Net) 27.25 2400.67 In view of loss, your Directors decided not to recommend payment of Operation Profit/Loss (1297.46) (3561.90) dividend on the equity shares and non convertible cumulative Redeemable Preference Shares for the financial year under review. Your Company has Interest and Finance 213.97 570.47 not transferred any amount to reserves during the Financial Year under review. Depreciation 73.07 138.48 EXPORT PERFORMANCE Profit Before Tax (1039.82) (4270.85) Your company’s business of export of paper and paper boards during the Provision for Tax 0.00 0.00 year was NIL.

Profit After Tax (767.43) (3684.05) INDUSTRIAL RELATIONS

Balance of Profit brought forward (767.43) (3684.05) The industrial relations remained cordial and satisfactory during the year under review. Amount available for (902.83) (3819.45) appropriation CHANGES IN NATURE OF BUSINESS

Appropriation During the period of FY 2016-17 the Company had received closure notice from Kerala State Pollution Control Board. In pursuance of this order, the General Reserve 0.00 0.00 entire paper manufacturing business was discontinued. After reviewing the various possibilities to resume production, the board found that there Proposed Dividend & tax on 0.00 0.00 are no prospects for re-opening of the units. Therefore the Board of Dividend Directors had decided to change the Business activity from Kraft paper manufacturing to Dry Chill Cold Storage (Logistics Business). The Company Retained profit carried to Balance 0.00 0.00 had got approval from Government of Kerala to establish Dry Chill Cold Sheet Storage (Logistics Business).

OPERATIONAL PERFORMANCE Your company has undertaken the implementation of Dry Chill Cold Storage (Logistics Business) and planning to establish 2.50 lakhs sq. ft The company has sold its plant and machinery of Edayar Unit during the Warehousing space in the Next One Year. year. Pursuant to change in the business activity of the company from Paper Business to Logistics Business, the Company is in the process for CHANGES IN SHARE CAPITAL DURING THE FINANCIAL YEAR, IF ANY leasing the existing building which was used as building for paper business by making slight modification and renovation work to make into a During the Financial Year 2017-18, Company has allotted 8,60,000 shares Warehouse. on 29/03/2018.

As on date of this report, the Authorized share capital of the Company is Directors, out of which 3 were independent directors, one was Managing Rs. 50,00,00,000/- (Rupees Fifty Crores Only) divided into 2,50,00,000 Director and one was additional Director , 2 was promoter director and equity shares of Rs. 10/- each and 2,50,00,000 preference shares of Rs. one was non executive director. 10/- each. The total issued, subscribed and paid up share capital of the Company as on the date of the report is Rs. 17,29,62,170/- (Rupees Changes in the composition of the Board Seventeen Crore Twenty Nine Lakhs Sixty Two Thousand One Hundred and The Board of Directors at their meeting held on 02.02.2018, approve the Seventy Only) divided into 1,72,96,217 equity shares of Rs. 10/- each and resignation of Mr. A Padmanabhan (DIN: 0037472) and Mr. S Giridhar Rs. 10,00,00,000/- (Rupees Ten Crores Only) divided into 1,00,00,000 (DIN: 0362916) from the Board with effect from 11.01.2018. Preference shares of Rs. 10/- each . During the financial year in order to fulfill the requirement of Independent MATERIAL CHANGES AND COMMITMENTS OCCURRED BETWEEN THE Directors by complying with SEBI (LODR) Regulations, 2015, the Board of DATE OF BALANCE SHEET AND THE DATE OF AUDIT REPORT Directors of the Company have appointed Mr. G. Raghavan (DIN- There were no material changes/events occurred between financial year 03630043) and Mr. N. Subramanian (DIN-03602858) as Independent th end date and date of the Board’s report. Directors of the Company with effect from 29 December, 2017 to hold office for a period of five consecutive years, not liable to retire by rotation. FINANCE Mr. AkhileshAgarwal (DIN: 00918838) has also been appointed as additional director at the Board Meeting held on 24th June, 2017 and A). Deposits reappointed as director at the 26th AGM on 29th December, 2017.

The Company has not accepted deposit from the public falling within the The Board of Directors at their meeting held on 02.02.2018, approved the ambit of Section 73 of the Companies Act, 2013 and The Companies appointment of Mrs. Rajee Rajkumar (DIN: 0033280) additional director (Acceptance of Deposits) Rules, 2014. subject to the approval of members. She holds office till the conclusion of the ensuing AGM and is eligible for appointment. Her appointment is B) Particulars of Loans, Guarantees or Investments being proposed in the notice of the forthcoming AGM. Details of Loans, Guarantees and Investments covered under the In accordance with the provisions of section 152(6) of the Act and the of provisions of Section 186 of the Companies Act, 2013 are given in the Article 83 of the Articles of Association of the Company , Mr. S notes to the Financial Statements. Subramaniam, Director is proposed to retire by rotation at the ensuing Annual General Meeting (AGM), and being eligible, offers himself for re- C) Commitments appointment. The Board recommends his re-appointment. The Company has raised share capital by an amount of Rs. 3 (Three) Crore Declaration of independence by way of allotment of 30 lakhs 11.25% Non Convertible Cumulative Redeemable Preference Shares of Rs. 10/- each to the Promoter Directors All independent directors have given declarations that they meet the to redeem the existing preference share capital of the Company issued to criteria of independence as laid down under section 149 of the companies KSIDC during 4th Quarter, 2018.All the repayment and interest act 2013 and as amended by the Companies (Amendment) Act, 2017 and commitments were met as per terms of arrangement with the Banks. regulation 16 of SEBI(LODR) Regulations, 2015, which have been relied on by Company and were placed at the Board meeting. In the opinion of the In the current financial year the Company has obtained Unsecured loans Board, the independent directors fulfill the necessary criteria for from Directors to the extent of Rs. 676.15 lakhs. independence as stipulated under the statutes. INTERNAL CONTROL SYSTEM KEY MANAGERIAL PERSONNEL (KMP) Your Company has adequate internal control and internal check system The details of the Key Managerial Personnel of the Company appointed commensurate with size of the organization. Audit Committee periodically pursuant to section to section 203 of the Companies Act, 2013 are as reviews the Internal Financial Control and Risk Assessment System of the follows Company. During the year, Internal Financial Controls were tested and no material weaknesses in the design or operating effectiveness were observed.

BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board of the Company at March 31, 2018 consisted of 8 Directors, out of which 3 were independent directors, one was Managing Director, one was additional Director, 2 was promoter director and one was non executive director. The current composition of the board consisted of 8

Sl.No Name Designation With effect from To

1 DrS.Rajkumar Managing Director 14-08-2018 13-08-2019

2 Mr. R.Ponnambalam Company Secretary 09-10-2013

3 Mr. V.N. Sridharan Chief Financial officer 12-11-2016

NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS Board of Directors (“Board”), Key Managerial Personnel (“KMP”) and the Senior Management Personnel (“SMP”) of the rd The Board of Directors met Six (6) times during the financial year on 03 Company (collectively referred to as “Executives”). The th th th nd April 2017, 24 June, 2017, 27 September, 2017, 29 December, 2017, 02 expression ‘‘Senior management’’ means personnel of the th February, 2018, 12 February, 2018. Company who are members of its core management team excluding Board of Directors comprising all members of The provisions of Companies Act, 2013 and listing regulations were adhered management one level below the Executive Directors, including to while considering the time gap of 120 days between two meetings. the functional heads. The policy would be reviewed every year by the Nomination and Remuneration Committee of the Board BOARD EVALUATION of Directors. Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing 1. Aims & Objectives Obligations and Disclosure Regulations) Regulation 2015, the Board has carried out an annual performance evaluation of its own performance, the The aims and objectives of this remuneration policy may be directors individually as well as the evaluation of the working of its summarized as follows: Committee. The manner in which the evaluation has been carried out has been explained in the Governance Report. The Remuneration Policy aims to enable the Company to attract, retain and motivate highly qualified members for the FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS: Board and Executive level. The Remuneration Policy seeks to enable the Company to provide a well balanced and The Company has practice of conducting familiarization program of the performance- related compensation package, taking into independent directors. account shareholder interests, industry standards and relevant REMUNERATION TO DIRECTORS Indian corporate regulations.

The Remuneration paid to the Executive Directors and the Sitting Fees paid The Remuneration Policy will ensure that the interests of Board to the Non‐Executive and Independent Directors are disclosed in the Extract Members & Executives are aligned with the business strategy to the Annual Return i.e Annexure I to the Board’s Report. and risk tolerance, objectives, values and long-term interests of the Company and will be consistent with the “pay-for- POLICY OF DIRECTOR APPOINTMENT AND REMUNERATION: performance” principle.

Preamble The Remuneration Policy will ensure that remuneration to Directors and Executives involves a balance between fixed and The Board of Directors of Sree Sakthi Paper Mills Limited (“the incentive pay reflecting short and long-term performance Company”) constituted the “Nomination and Remuneration objectives appropriate to the working of the Company and its Committee” at the meeting held on 30 May, 2014 with goals. immediate effect, after renaming the Remuneration Committee formed earlier, consisting of Four (04) Non-Executive Directors of which majority are Independent Directors.

The Nomination and Remuneration Committee and this policy shall be in compliance with Section 178 of the Companies Act, 2013 read along with the applicable rules thereto and clause 49

under the Listing Agreement. The Remuneration Policy provides a framework for remuneration paid to the members of the 15

2. Principles of Remuneration the ongoing appropriateness and relevance of the Remuneration Policy; ensure that all provisions regarding Support for Strategic Objectives: Remuneration and reward frameworks and disclosure of remuneration, including pensions, are fulfilled; decisions shall be developed in a manner that is consistent with, supports obtain reliable, up-to-date information about remuneration in and reinforces the achievement of the Company’s vision and strategy. other companies; ensure that no Director or Executive is involved in any decisions as to their own remuneration. Transparency: The process of remuneration management shall be Without prejudice to the generality of the terms of reference to transparent, conducted in good faith and in accordance with appropriate the Nomination and Remuneration Committee set out above, levels of confidentiality. the Committee shall operate the Company’s share option schemes (if any) or other incentives schemes (if any) as they Internal equity: The Company shall remunerate the Board Members and apply to. It shall recommend to the Board the total aggregate the Executives in terms of their roles within the organisation. Positions amount of any grants to employees (with the specific grants to shall be formally evaluated to determine their relative weight in relation to individuals to be at the discretion of the Board) and make other positions within the Company. amendments to the terms of such schemes (subject to the External equity: The Company strives to pay an equitable remuneration, provisions of the schemes relating to amendment); liaise with capable of attracting and retaining high quality personnel. Therefore the the trustee / custodian of any employee share scheme which is Company will remain logically mindful of the ongoing need to attract and created by the Company for the benefit of employees or retain high quality people and the influence of external remuneration Directors and review the terms of Executive Directors’ service pressures. contracts from time to time.

Flexibility: Remuneration and reward offerings shall be sufficiently flexible 4. Procedure for selection and appointment of the Board to meet both the needs of individuals and those of the Company whilst Members complying with relevant tax and other legislation. Board membership criteria Performance-Driven Remuneration: The Company shall entrench a culture • The Committee, along with the Board, reviews on an annual of performance driven remuneration through the implementation of the basis, appropriate skills, characteristics and experience required Performance Incentive System. of the Board as a whole and its individual members. The Affordability and Sustainability: The Company shall ensure that objective is to have a Board with diverse background and remuneration is affordable on a sustainable basis. experience in business, government, academics, technology and in areas that are relevant for the Company’s global 3. Nomination and Remuneration Committee operations.

The earlier Remuneration Committee of the Board of Directors now re- • In evaluating the suitability of individual Board Members, the named as Nomination and Remuneration Committee. Members of the Committee takes into account many factors, including general Committee shall be appointed by the Board and shall comprise of three or understanding of the Company’s business dynamics, global more Non-Executive Directors out of which not less than one-half shall be business and social perspective, educational and professional Independent Directors. background and personal achievements.

The Committee shall be responsible for: • In addition, Directors must be willing to devote sufficient time and energy in carrying out their duties and responsibilities Formulating framework and/or policy for remuneration, terms of effectively. They must have the aptitude to critically evaluate employment including service contracts, policy for and scope of pension management’s working as part of a team in an environment of arrangements, etc for Executives and reviewing it on a periodic basis; collegiality and trust. Formulate the criteria for determining qualifications, positive attributes and independence of a Director and recommend to the Board a policy, • The Committee evaluates each individual with the objective relating to the remuneration for the Director. of having a group that best enables the success of the Company’s business. Identifying persons who are qualified to become Directors and who may be appointed as Executives in accordance with the Selection of Board Members/ extending invitation to a criteria laid down in this policy, recommend to the Board their potential Director to join the Board appointment and removal and carry out their evaluation. One of the roles of the Committee is to periodically identify Formulating terms for cessation of employment and ensure competency gaps in the Board, evaluate potential candidates as that any payments made are fair to the individual and the per the criteria laid above, ascertain their availability and make Company, that failure is not rewarded and that the duty to suitable recommendations to the Board. mitigate loss is fully recognised; The Committee shall review

The objective is to ensure that the Company’s Board is Committees of Board of Directors may be modified or appropriate at all points of time to be able to take decisions implemented from time to time only with the approval of the commensurate with the size and scale of operations of the Board in due compliance of the provisions of Companies Act, Company. The Committee also identifies suitable candidates in 2013. the event of a vacancy being created on the Board on account of retirement, resignation or demise of an existing Board (b) Remuneration to Executive Directors, Key Managerial member. Based on the recommendations of the Committee, Personnel(s) (KMPs) & Senior Management the Board evaluates the candidate(s) and decides on the Personnel (s) (SMPs): selection of the appropriate member. • The remuneration/compensation/ commission etc. to the The Board then makes an invitation (verbal / written) to the Managing Director/ Whole-Time Director, new member to join the Board as a Director. On acceptance of the same, the new Director is appointed by the Board. KMP and Senior Management Personnel will be determined by the Committee and recommended to the Board for approval. 5. Procedure for selection and appointment of Executives The remuneration/compensation/ commission etc. shall be other than Board Members subject to the prior/post approval of the shareholders of the The Committee shall actively liaise with the relevant Company and Central Government, wherever required. departments of the Company to study the requirement for The remuneration determined for MD/WTDs, KMPs and SMPs management personnel, and produce a written document are subjected to the approval of the Board of Directors in due thereon; The Committee may conduct a wide-ranging search compliance of the provisions of Companies Act, 2013. The for candidates for the positions of Employees within the remuneration for the KMP and the SMP at the time of the Company, within enterprises controlled by the Company or appointment has to be approved by the Board. within enterprises in which the Company holds equity, if any, and on the human resources market; The professional, • If in any financial year, the Company has no profits or its academic qualifications, professional titles, detailed work profits are inadequate, the Company shall pay remuneration to experience and all concurrently held positions of the initial its Managing Director / Whole-Time Director in accordance candidates shall be compiled as a written document; A meeting with the provisions of of the Committee shall be convened, and the qualifications of the initial candidates shall be examined on the basis of the Schedule V of the Act and if it is not able to comply with such conditions for appointment of the Employees; Before the provisions, with the previous approval of the Central selection of Employee, the recommendations of and relevant Government. information on the relevant candidate(s) shall be submitted to the Board of Directors; The Committee shall carry out other • As a policy, the Executive Directors are neither paid sitting fee follow-up tasks based on the decisions of and feedback from nor any commission. the Board of Directors. 7. Role of Independent Directors 6. Compensation Structure The Committee shall, in consultation with the Independent (a) Remuneration to Non-Executive Directors: Directors of the Company, prepare and submit this policy to the Board for its approval. The Independent Directors shall have The Non-executive Directors of the Company are paid power and authority to determine appropriate levels of remuneration by way of sitting fees only for attending the remuneration of Executive Directors and Employees and have a Meetings of the Board of Directors and its Committees. The prime role in appointing and where necessary recommend sitting fees paid to the Non-executive Directors for attending removal of Executive Directors and Employees. Meetings of Board of Directors, Audit Committee of Board of Directors and Nomination and Remuneration Committee is Rs. The Independent Directors shall submit its recommendations/ 10,000/- per meeting. proposals/ decisions to the Committee which the Committee shall consult and take to the Board of Directors. Beside the sitting fees they are also entitled to reimbursement of expenses. The Non-Executive Directors of the Company are 8. Approval and publication not paid any other remuneration or commission. This Remuneration Policy as framed by the Committee shall be The sitting fees of the Non-Executive Directors for attending recommended to the Board of Directors for its approval. This meetings of Board of Directors and the policy shall be hosted on the Company’s website.

The policy shall form part of Director’s report to be issued by the Board of Directors in terms of Companies Act, 2013 (viii) Project Finance Committee Mr. S. Rajkumar-Chairman 9. Supplementary provisions Mr. S.Subramanian-Member

This Policy shall formally be implemented from the date on REMUNERATION POLICY which they are adopted pursuant to a resolution of the Board The Company’s remuneration policy is directed towards of Directors. Any matters not provided for in this Policy shall be rewarding performance based on review of achievements handled in accordance with relevant State laws and regulations periodically. The remuneration policy is in consonance with the and the Company’s Articles of Association. If this Policy conflict existing industry practice. with any laws or regulations subsequently promulgated by the state or with the Company’s Articles of Association as amended RISK MANAGEMENT POLICY pursuant to lawful procedure, the relevant state laws and regulations and the Company’s Articles of Association shall The Company has formulated a Risk Management Policy to prevail, and this Policy shall be amended in a timely manner identify, assess, monitor and mitigate various risks to the and submitted to the Board of Directors for review and Company. Identified risks and the mitigation plans are adoption. The right to interpret this Policy vests in the Board of discussed at the meetings of the Risk Management Committee Directors of the Company. and the Board of Directors of the Company.

BOARD COMMITTEES CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY Your Board has constituted a CSR Committee consisting of the Board Committees plays a vital role in improving the Board above mentioned three members. CSR policy is also framed and effectiveness in areas where more focused and discussions are annexed. But during the year, the profit as determined in required. Board has constituted the following Committees in accordance with the provisions of Companies Act, 2013 and Section 135 (5) of the Companies Act, 2013 is less than the SEBI (Listing Obligations and Disclosure Requirements) threshold limit. Hence there was no requirement to spend Regulations, 2015 and its compositions are as follows: under the CSR policy. Statement is annexed is annexed as (i) Audit Committee Annexure VI to this Report. Mr. N Subramanian – Chairman Mr. G Raghavan – Member AUDITORS Mr. U.G.Bhat – Member At the AGM held on 29th December, 2017, M/s. KPR & Co. (FRN: (ii) Nomination and Remuneration Committee 005326S), Chartered Accountants, Cochin, Kerala was Mr. G Raghavan – Chairman appointed as the Statutory Auditors of the Company to hold Mr. N Subramanian – Member office for a period of five years commencing from the Mr. U.G.Bhat – Member th conclusion of 26 Annual General Meeting till the conclusion of st (iii) Shareholders Relationship Committee 31 Annual General Meeting subject to ratification by every Mr. S. Rajkumar – Chairman members every year. Mr. U.G. Bhat – Member Mr. N Subramanian- Member The Company has received a letter from M/s. KPR & Co. (FRN: 005326S), Chartered Accountants, Cochin, Kerala to the effect (iv) Risk Management Committee that their appointment as Auditors, if made, would be within Mr. G Raghavan – Chairman the limits under Section 141 of the Companies Act, 2013. Mr. U.G.Bhat – Member Mr. N Subramanian – Member PARTICULARS UNDER SECTION 134 (v) Corporate Social Responsibility Committee Mr. S. Rajkumar-Chairman Conservation of Energy, Technology Absorption Mr. Akhilesh Agarwal-Member Mr. N Subramanian-Member Statement of particulars under Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (vi) Share Issue/Transfer Committee (Accounts) Rules, 2014, is annexed as Annexure –III Mr. S. Rajkumar-Chairman Mr. G.Raghavan -Member CORPORATE GOVERNANCE Mr. N Subramanian-Member Your Company is committed to good corporate governance (vii) Machinery Disposal Committee aligned with the best corporate practices. A separate Report on Mr. S. Rajkumar-Chairman Corporate Governance in Annexure-IV along with Auditor’s Mr. G.Raghavan -Member Certificate on Compliance with the conditions of Corporate Mr. N Subramanian-Member

Governance is provided as a part of this Annual Report, besides SEXUAL HARASSMENT OF WOMEN AT WORKPLACE the Management Discussion and Analysis. (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

EXTRACT OF ANNUAL RETURN Your Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women Extract of Annual Return in Form MGT 9, of the Company is at Workplace (Prevention, Prohibition and Redressal) Act, 2013. annexed as Annexure I to this Report. The Internal Complaints Committee (“ICC”) has been set up to redress the complaints received regarding sexual harassment. RELATED PARTY TRANSACTIONS All employees are covered under this policy. All related party transactions that were entered into during the During the financial year 2017-18, there were no cases financial year were on an arm’s length basis and were in the reported under Sexual Harassment of Women at Workplace ordinary course of business. There are no materially significant (Prevention Prohibition and Redressal) Act, 2013. related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other DIRECTORS RESPONSIBILITY STATEMENT designated persons which may have a potential conflict with the interest of the Company at large. Pursuant to the requirement under 134(3) (c) of the Companies Act, 2013 Directors report that: All Related Party Transactions are placed before the Audit Committee for approval. 1. In the preparation of the annual accounts for the financial year ended 31st March, 2018 the applicable accounting Particulars of contract or arrangements with related parties are standards had been followed along with proper explanation annexed in Form AOC 2 as Annexure II. relating to material departures.

SECRETARIAL AUDITOR 2. The directors had selected such accounting policies and applied them consistently and made judgment and estimates The Board has appointed M/s. Sreevidhya, Practising Company that were reasonable and prudent so as to give a true and fair Secretary, to conduct Secretarial Audit for the financial year view of the state of affairs of the Company at the end of the 2017-18. The Secretarial Audit Report for the financial year financial year and of the loss of the company for the year under ended March 31, 2018 is annexed herewith marked as review. Annexure V to this Report. 3. The Directors had taken proper and sufficient care for the WHISTLE BLOWER POLICY/ VIGIL MECHANISM maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of In accordance with Section 177 of the Companies Act, 2013 the company and for preventing and detecting fraud and other and Regulation 22 of irregularities. SEBI(LODR)Regulation2015, the Company has 4. The directors had prepared the Annual Accounts for the constituted a Whistle Blower Policy/ Vigil Mechanism to establi financial year ended 31st March, 2018 on a ‘going concern’ sh a vigil mechanism for the directors and employees to rep basis. ort genuine concerns in such manner as may be prescribed and to report to the management instances of unethical behavi 5. That proper internal financial controls were in place and that or, actual or suspected fraud or violation of the Company’s cod the financial controls were adequate and were operating e of conduct. effectively. The detail of the Whistle Blower Policy has been posted on the 6. The Directors have devised proper systems to ensure website of the Company. compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively. ACKNOWLEDGEMENT The Board places on record, its appreciation for the co-operation and support received from shareholders, customers, suppliers, employees, government authorities and banks. By and on behalf of the Board of Directors Sd/- Sd/- Chennai – 17 S.Rajkumar N.Subramanian Date: 13/08/2018 Managing Director Director

Annexure I FORM NO. MGT 9 EXTRACT OF ANNUAL RETURN As on financial year ended on 31.03.2018

Pursuant to Section 92 (3) of the Companies Act, 2013 and rule 12(1) of the Company (Management & Administration) Rules, 2014.

I. REGISTRATION & OTHER DETAILS:

1. CIN L21012KL1991PLC006207

2. Registration Date 03 October 1991

3. Name of the Company SREE SAKTHI PAPER MILLS LIMITED

4. Category/Sub-category of the Company Public Company Limited by Shares/ Indian Non-Government Company

5. Address of the Registered office & Sree Kailas 57/2993 /94 contact details Paliam Road

Ernakulam, Cochin - 682 016

6. Whether listed company Yes/No

7. Name, Address & contact details of the Bigshare Services Pvt. Ltd. Registrar & Transfer Agent, if any. E-2, Ansa Industrial Estate,

Sakivihar Road, Saki Naka, Andheri (E),

Mumbai – 400 072, Tel No. 022 4043 0200 E-mail : [email protected]

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY (All the business activities contributing 10 % or more of the total turnover of the company shall be stated)

S. No. Name and Description of main products / NIC Code of the % to total turnover of the company services Product/service

1 Kraft Paper 17014 100% 2 Warehousing Business 52109 -

III. Particulars of holding, Subsidiary and Associate Companies

Sl Name and Address of the Company CIN/GLN Holding/Subsidiary/As % of shares held Applicable No sociate Section

1 Sree Kailas Palchuram Hydro Power U40100KL2008PLC02 Subsidiary 47.00 2(87)(i) Limited 57/2993, Sree Kailas, Paliam 2145 Road, Kochi 682016

2 AdisakthiMukkuttathode Hydro Power U40100KL20 Subsidiary 47.00 2(87)(i) Limited 8PLC022144 57/2993, Sree Kailas Paliam Road, Kochi 682016 3 JalashaayiAlamparathodu Hydro Power U40100KL2008PLC02 Subsidiary 47.00 2(87)(i) Limited 2143

IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity) Category-wise Share Holding

No. of Shares held at the beginning of the No. of Shares held at the end of the year year: 01/04/2017 00:0 :31/03/2018 Category of Shareholder Demat Total Total % Demat Total Total % % Physica Shares Physic Shares Chang l al e (A) Shareholding of Promoter and Promoter Group2 Indian (a) INDIVIDUAL / HUF 7777092 0 7777092 47.32 8303378 0 8303378 48.01 0.69 (b) Central / State government(s) 0 0 0 0.00 0 0 0 0.00 0.00 (c) BODIES CORPORATE 0 0 0 0.00 0 0 0 0.00 0.00 (d) FINANCIAL INSTITUTIONS / BANKS 0 0 0 0.00 0 0 0 0.00 0.00 (e) ANY OTHERS (Specify) (i) GROUP COMPANIES 0 0 0 0.00 0 0 0 0.00 0.00 (ii) TRUSTS 0 0 0 0.00 0 0 0 0.00 0.00 (iii) DIRECTORS RELATIVES 0 0 0 0.00 0 0 0 0.00 0.00 SUB TOTAL (A)(1) : 7777092 0 7777092 47.32 8303378 0 8303378 48.01 0.69 Foreign (a) BODIES CORPORATE 0 0 0 0.00 0 0 0 0.00 0.00 (b) INDIVIDUAL 0 0 0 0.00 0 0 0 0.00 0.00 (c) INSTITUTIONS 0 0 0 0.00 0 0 0 0.00 0.00 (d) QUALIFIED FOREIGN INVESTOR 0 0 0 0.00 0 0 0 0.00 0.00 (e) ANY OTHERS (Specify) 0 0 0 0.00 0 0 0 0.00 0.00 SUB TOTAL (A)(2) : 0 0 0 0.00 0 0 0 0.00 0.00 Total holding for promoters (A)=(A)(1) + (A)(2) 7777092 0 7777092 47.32 8303378 0 8303378 48.01 0.69 (B) Public shareholding Institutions (a) Central / State government(s) 21

0 0 0 0.00 0 0 0 0.00 0.00 (b) FINANCIAL INSTITUTIONS / BANKS 0 0 0 0.00 0 0 0 0.00 0.00 (c) MUTUAL FUNDS / UTI 0 0 0 0.00 0 0 0 0.00 0.00 (d) VENTURE CAPITAL FUNDS 0 0 0 0.00 0 0 0 0.00 0.00 (e) INSURANCE COMPANIES 0 0 0 0.00 0 0 0 0.00 0.00 (f) FII'S 0 0 0 0.00 0 0 0 0.00 0.00 (g) FOREIGN VENTURE CAPITAL INVESTORS 0 0 0 0.00 0 0 0 0.00 0.00 (h) QUALIFIED FOREIGN INVESTOR 0 0 0 0.00 0 0 0 0.00 0.00 (i) ANY OTHERS (Specify) 0 0 0 0.00 0 0 0 0.00 0.00 (j) FOREIGN PORTFOLIO INVESTOR 0 0 0 0.00 0 0 0 0.00 0.00 (k) ALTERNATE INVESTMENT FUND 0 0 0 0.00 0 0 0 0.00 0.00 SUB TOTAL (B)(1) : 0 0 0 0.00 0 0 0 0.00 0.00 Non-institutions (a) BODIES CORPORATE 438341 0 438341 2.67 578202 0 578202 3.34 0.68 (b) INDIVIDUAL (i) (CAPITAL UPTO TO Rs. 1 3861144 11748 3872892 23.56 3782273 11748 3794021 21.94 (1.63) Lakh) (ii) (CAPITAL GREATER THAN 3349136 0 3349136 20.38 3713887 0 3713887 21.47 1.10 Rs. 1 Lakh) (c) ANY OTHERS (Specify) (i) TRUSTS 0 0 0 0.00 0 0 0 0.00 0.00 (ii) CLEARING MEMBER 34147 0 34147 0.21 7301 0 7301 0.04 (0.17) (iii) NON RESIDENT INDIANS 83785 0 83785 0.51 688 0 688 0.00 (0.51) (NRI) (iv) NON RESIDENT INDIANS 128229 0 128229 0.78 147899 0 147899 0.86 0.07 (REPAT) (v) NON RESIDENT INDIANS 736369 0 736369 4.48 734625 0 734625 4.25 (0.23) (NON REPAT) (vi) DIRECTORS RELATIVES 15916 100 16016 0.10 15916 100 16016 0.09 (0.00) (vii) EMPLOYEE 0 0 0 0.00 0 0 0 0.00 0.00 (viii) OVERSEAS BODIES 0 0 0 0.00 0 0 0 0.00 0.00 CORPORATES (ix) UNCLAIMED SUSPENSE 0 0 0 0.00 0 0 0 0.00 0.00 ACCOUNT (x) IEPF 0 0 0 0.00 0 0 0 0.00 0.00 (d) QUALIFIED FOREIGN INVESTOR 0 0 0 0.00 0 0 0 0.00 0.00 22

210 0 210 0.00 200 0 200 0.00 (0.00) SUB TOTAL (B)(2) : 8647277 11848 8659125 52.68 8980991 11848 8992839 51.99 (0.69) Total Public Shareholding (B)=(B)(1) + (B)(2) 8647277 11848 8659125 52.68 8980991 11848 8992839 51.99 (0.69) (C) Shares held by Custodians and against which Depository Receipts have been issued

(a) SHARES HELD BY CUSTODIANS 0 0 0 0.00 0 0 0 0.00 0.00 (i) Promoter and Promoter 0 0 0 0.00 0 0 0 0.00 0.00 Group (ii) Public 0 0 0 0.00 0 0 0 0.00 0.00 SUB TOTAL (C)(1) : 0 0 0 0.00 0 0 0 0.00 0.00

(C)=(C)(1) 0 0.00 0 0 0 0.00 0.00 Grand Total (A) + (B) + (C) 16424369 11848 16436217 100.00 17284369 11848 17296217 100.00 0.00

B) Shareholding of Promoter-

Shareholding at the beginning of the year Shareholding at the end of the year 01/04/2017 31/03/2018

Sr. NAME Number of % Shares of % of Shares Number of % Shares % of Shares % No Shares the Pledged/ Shares of the Pledged/ Change Company encumbered Company encumbered in to total shares to total shares sharehol ding during the year 1 GURURAJA BHAT. U . 50 0.00 0.00 50 0.00 0.00 0.00

2 S RAJKUMAR . 10000 0.06 0.00 10000 0.06 0.00 0.00

3 N SUBRAMANIAN 12738 0.08 0.00 12738 0.07 0.00 0.00

4 E KAMALAM 17868 0.11 0.00 0 0.00 0.00 -0.11

5 RAJEE SAKUNTHALA . 22977 0.14 0.00 22977 0.13 0.00 0.00

6 AMBILI 49331 0.30 0.00 0 0.00 0.00 -0.30 SUBRAHMANIAM

7 A GANESH 89940 0.55 0.00 89940 0.52 0.00 -0.03

8 VIGNESH R 130159 0.79 0.00 130159 0.75 0.00 -0.04

9 VIGNESH R 146546 0.89 0.00 146546 0.85 0.00 -0.04 23

10 RAJEE RAJKUMAR 285544 1.74 0.00 285544 1.65 0.00 -0.09

11 SUBRAMONIAM 333944 2.03 0.00 67429 0.39 0.00 -1.64 SIVATHANU PILLAI

12 S GIRIDHAR 713223 4.34 0.00 713223 4.12 0.00 -0.22

13 AYYAPPAN 1294658 7.88 0.00 1294658 7.49 0.00 -0.39 PADMANABHAN

14 S RAJKUMAR 4670114 28.41 0.00 5530114 31.97 0.00 3.56 7777092 47.32 0.00 8303378 48.01 0.00 0.69

C) Change in Promoters’ Shareholding (please specify, if there is no change)

Increase / Cumulative Sr. Decreas Shareholdi Name Shareholding Date Reason No. e in ng during shareho the year lding

Perce No. of Shares ntage at the of % of Total beginning total Shares of Number of (01.04.2017) share the Shares / End of the s of Company year the (31.03.2018) comp any 1 GURURAJA BHAT. U . 50 0.00 04/01/2017 31/03/2018 0 50 0.00 2 S RAJKUMAR . 10000 0.06 04/01/2017 31/03/2018 0 10000 0.06 3 N SUBRAMANIAN 12738 0.08 04/01/2017 31/03/2018 0 12738 0.07 4 E KAMALAM 17868 0.11 04/01/2017 01/05/2018 17868 SOLD 0 0.00 31/03/2018 0 0 0.00 5 RAJEE SAKUNTHALA . 22977 0.14 04/01/2017 12/01/2018 0 22977 0.13 6 AMBILI SUBRAHMANIAM 49331 0.30 30/03/2018 01/05/2018 49331 SOLD 0 31/03/2018 0 0 0.00 7 A GANESH 89940 0.55 04/01/2017 31/03/2018 0 89940 0.52 24

8 VIGNESH R 130159 0.79 04/01/2017 31/03/2018 0 130159 0.75 9 VIGNESH R 146546 0.89 04/01/2017 31/03/2018 0 146546 0.85

10 RAJEE RAJKUMAR 285544 1.74 04/01/2017 31/03/2018 0 285544 1.65

11 SUBRAMONIAM SIVATHANU 333944 2.03 04/01/2017 PILLAI 01/05/2018 266515 SOLD 67429 0.39 31/03/2018 0 67429 0.39

12 S GIRIDHAR 713223 4.34 04/01/2017 31/03/2018 0 713223 4.12

13 AYYAPPAN PADMANABHAN 1294658 7.88 04/01/2017 31/03/2018 0 1294658 7.49

14 S RAJKUMAR 4670114 28.41 04/01/2017 29/03/2018 860000 31/03/2018 0 5530114 31.97

D) Shareholding Pattern of top ten Shareholders: (Other than Directors, Promoters and Holders of GDRs and ADRs):

Sr.No NAME No. of Shares at Date Increase/Decr Reason Number of Perc the begining/End ease in share- Shares enta of the year holding ge of total shar es of the com pan y 1 GOPINATHAN C K 1,006,000 31-Mar-17 0 Transfer 1,006,000 3.50

21-Apr-17 -6000 Transfer 1,000,000 3.47

28-Apr-17 -21999 Transfer 978,001 3.40

5-May-17 -17066 Transfer 960,935 3.34

12-May-17 -19449 Transfer 941,486 3.27

19-May-17 -22347 Transfer 919,139 3.19

26-May-17 -28086 Transfer 891,053 3.10

2-Jun-17 -71053 Transfer 820,000 2.85

15-Dec-17 -47508 Transfer 772,492 2.68

29-Dec-17 -30000 Transfer 742,492 2.58

5-Jan-18 -492492 Transfer 250,000 0.87

12-Jan-18 -200000 Transfer 50,000 0.17

26-Jan-18 -35000 Transfer 15,000 0.05

2-Feb-18 -15000 Transfer 0 0.00

31-Mar-18 0 Transfer 0 0.00

2 RAJA RAM 727,689 31-Mar-17 0 Transfer 727,689 2.53

16-Feb-18 -10000 Transfer 717,689 2.49

717,689 31-Mar-18 0 Transfer 717,689 2.49

3 ANAND MOHAN 0 31-Mar-17 Transfer 0 0.00

21-Apr-17 7520 Transfer 7,520 0.03

28-Apr-17 12000 Transfer 19,520 0.07

5-May-17 5000 Transfer 24,520 0.09

7-Jul-17 9060 Transfer 33,580 0.12

21-Dec-17 21420 Transfer 55,000 0.19

29-Dec-17 500 Transfer 55,500 0.19

5-Jan-18 279000 Transfer 334,500 1.16

31-Mar-18 334500 Transfer 669,000 2.32

669,000 31-Mar-18 0 Transfer 669,000 2.32

4 SUBRAMANIAM 232,840 31-Mar-17 0 Transfer 232,840 0.81 SIVATHANU PILLAI 31-Mar-18 232840 Transfer 465,680 1.62

465,680 31-Mar-18 0 Transfer 465,680 1.62

5 SIVAKALA GANESH 222,782 31-Mar-17 0 Transfer 222,782 0.77

445,564 31-Mar-18 0 Transfer 445,564 1.55

31-Mar-18 222782 Transfer 445,564 1.55

6 BALRAM BHARWANI 187,187 31-Mar-17 0 Transfer 187,187 0.65

19-May-17 1833 Transfer 189,020 0.66

26-May-17 3080 Transfer 192,100 0.67

21-Jul-17 983 Transfer 193,083 0.67

18-Aug-17 2850 Transfer 195,933 0.68

8-Sep-17 17 Transfer 195,950 0.68

15-Sep-17 2950 Transfer 198,900 0.69

22-Sep-17 600 Transfer 199,500 0.69

29-Sep-17 50 Transfer 199,550 0.69

13-Oct-17 550 Transfer 200,100 0.70

24-Nov-17 100 Transfer 200,200 0.70

1-Dec-17 150 Transfer 200,350 0.70

16-Feb-18 -350 Transfer 200,000 0.69

31-Mar-18 200000 Transfer 400,000 1.39 26

400,000 31-Mar-18 0 Transfer 400,000 1.39

7 ABHISHEK SINGHVI 0 31-Mar-17 Transfer 0 0.00

12-Jan-18 66657 Transfer 66,657 0.23

2-Feb-18 33343 Transfer 100,000 0.35

9-Feb-18 2947 Transfer 102,947 0.36

16-Feb-18 16297 Transfer 119,244 0.41

23-Feb-18 7000 Transfer 126,244 0.44

2-Mar-18 756 Transfer 127,000 0.44

31-Mar-18 127000 Transfer 254,000 0.88

254,000 31-Mar-18 0 Transfer 254,000 0.88

8 BOSCO ARMANDO 0 31-Mar-17 Transfer 0 0.00 MENEZES 12-Jan-18 10000 Transfer 10,000 0.03

26-Jan-18 27210 Transfer 37,210 0.13

2-Feb-18 20240 Transfer 57,450 0.20

9-Feb-18 57806 Transfer 115,256 0.40

16-Feb-18 744 Transfer 116,000 0.40

232,000 31-Mar-18 0 Transfer 232,000 0.81

31-Mar-18 116000 Transfer 232,000 0.81

9 PARANJOTHI 0 31-Mar-17 Transfer 0 0.00 SUNDARAM 22-Sep-17 14000 Transfer 14,000 0.05

20-Oct-17 2500 Transfer 16,500 0.06

15-Dec-17 80000 Transfer 96,500 0.34

29-Dec-17 44955 Transfer 141,455 0.49

12-Jan-18 80000 Transfer 221,455 0.77

221,455 31-Mar-18 0 Transfer 221,455 0.77

10 LAL TOLANI 91,615 31-Mar-17 0 Transfer 91,615 0.32

7-Apr-17 4000 Transfer 95,615 0.33

12-May-17 3831 Transfer 99,446 0.35

19-May-17 24 Transfer 99,470 0.35

2-Jun-17 2000 Transfer 101,470 0.35

31-Mar-18 101470 Transfer 202,940 0.71

202,940 31-Mar-18 0 Transfer 202,940 0.71

11 AJAY GIRDHARILAL 167,500 31-Mar-17 0 Transfer 167,500 0.58 BHARTIYA 28-Apr-17 -2000 Transfer 165,500 0.58

3-Nov-17 -2500 Transfer 163,000 0.57

15-Dec-17 -88000 Transfer 75,000 0.26

5-Jan-18 -50000 Transfer 25,000 0.09

12-Jan-18 -25000 Transfer 0 0.00

31-Mar-18 0 Transfer 0 0.00

12 SadashivamurthyAnu 0 31-Mar-17 Transfer 0 0.00 radha 21-Dec-17 6500 Transfer 6,500 0.02

5-Jan-18 72500 Transfer 79,000 0.27

158,000 31-Mar-18 0 Transfer 158,000 0.55

31-Mar-18 79000 Transfer 158,000 0.55

13 CHIRAYUSH PRAVIN 134,364 31-Mar-17 0 Transfer 134,364 0.47 VAKIL 12-Jan-18 -2000 Transfer 132,364 0.46

132,364 31-Mar-18 0 Transfer 132,364 0.46

14 SREY FINANCIAL 130,000 31-Mar-17 0 Transfer 130,000 0.45 SERVICE PVT. LTD 15-Dec-17 -43661 Transfer 86,339 0.30

86,339 31-Mar-18 0 Transfer 86,339 0.30

15 GULU KHUBA 87,602 31-Mar-17 0 Transfer 87,602 0.30 WATUMULL 87,602 31-Mar-18 0 Transfer 87,602 0.30

E) Shareholding of Directors and Key Managerial Personnel:

S.No Shareholding of each Directors and each Key Shareholding at the beginning of the Cumulative Shareholding Managerial Personnel year during the Year

No. of shares % of total No. of shares % of total shares of the shares of company the

company

1 S Rajkumar 4680114 28.41 5540114 32.03

2 SubramaniamSivathanuPillai 333944 2.03 67429 0.39

3 E Kamalam 17868 0.11 0 0

4 GururajaBhat. U 50 0.00 50 0.00

5 N Subramanian 0 0 0 0

6 AkhileshAgarwal 0 0 0 0

7 G Raghavan 0 0 0 0

8. RajeeRajkumar 285544 1.74 285544 1.65

Total 7211455 43.81 7055873 34.07

F) INDEBTEDNESS - Indebtedness of the Company including interest outstanding/accrued but not due for payment. In lakhs

Secured Loans Total Unsecured Loans Deposits excluding deposits Indebtedness

Indebtedness at the beginning of the financial year i) Principal Amount 2,216.30 2051.38 1.43 4,269.11 ii) Interest due but not paid 16.80 16.80 iii) Interest accrued but not due Total (i+ii+iii) 2,233.10 2,051.38 1.43 4,285.91

Change in Indebtedness during the financial year - - * Addition 1,511.09 503.54 2,014.63 * Reduction

Net Change

Indebtedness at the end of the financial year i) Principal Amount 712.01 1,547.84 1.43 2,261.28 ii) Interest due but not paid iii) Interest accrued but not due Total (i+ii+iii) 712.01 1,547.84 1.43 2,261.28 XI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL- A. Remuneration to Managing Director, Whole-time Directors and/or Manager: (Rs. In Lacs) SN. Particulars of Remuneration Name of MD/WTD/ Manager Total Amount 1 Gross salary (a) Salary as per provisions 0 0 0 contained in section 17(1) of the Income-tax Act, 1961 (b) Value of perquisites u/s 17(2) 0 0 0 Income-tax Act, 1961 (c) Profits in lieu of salary under - - - section 17(3) Income- tax Act, 1961 2 Stock Option - - - 3 Sweat Equity - - -

4 Commission - - - - as % of profit - others, specify…

5 Others, medical expense - - -

Total (A) 0 0 0 Ceiling as per the Act

B. Remuneration to other directors SN. Particulars of Name of Directors Total Remuneration Amount 1 Independent Directors AkhileshAgarwal Mr. U G Bhat Mr. G Raghavan Mr. N. Subramnian

Fee for attending board 50,000 50,000 50,000 60,000 2,10,000 committee meetings Commission ------Others, please specify ------Total (1) 50,000 50,000 50,000 60,000 2,10,000 2 Nominee Directors Fee for attending board committee meetings Commission ------Others, please specify ------Total (2) 3 Other Non-Executive Mr. S. Giridhar(Till Mr. S. Mrs. E. Mrs. Directors 11.01.2018) Subramaniam Kamalam RajeeRajkumar Fee for attending board committee meetings 20,000 - 20,000 - - 40,000 Commission - - - - - Others, please specify - - - - - Total (3) - 20,000 - 20000 - 40,000 Total (B)=(1+2+3) 50,000 70,000 50,000 80,000 2,50,000 Total Managerial Remuneration (A+B) 2,50,000 Overall Ceiling as per the Act

C. REMUNERATION TO KEY MANAGERIAL PERSONNEL OTHER THAN MD/MANAGER/WTD (Rs. In Lakhs) S.No Particulars of Remuneration Key Managerial Personnel

CEO CS CFO Total 1 Gross salary (a) Salary as per provisions contained in section 17(1) of the Income-tax Act, NA - 3.60 3.60 1961 (b) Value of perquisites u/s 17(2) Income-tax Act, 1961 NA NA NA NA

2 Stock Option NA NA NA NA

3 Sweat Equity NA NA NA NA

4 Commission NA NA NA NA

- as % of profit NA NA NA NA

others, specify… NA NA NA NA

5 Others, please specify NA NA NA NA

Total 3.60 3.60

XII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES:

Type Section of the Brief Details of Penalty / Authority Appeal made, Companies Act Description Punishment/ [RD / NCLT/ if any (give Details) Compounding fees COURT] imposed

A. COMPANY Penalty Nil Nil Nil Nil Nil

Punishment Nil Nil Nil Nil Nil

Compounding Nil Nil Nil Nil Nil

B. DIRECTORS Penalty Nil Nil Nil Nil Nil

Punishment Nil Nil Nil Nil Nil

Compounding Nil Nil Nil Nil Nil

C. OTHER OFFICERS IN DEFAULT Penalty Nil Nil Nil Nil Nil

Punishment Nil Nil Nil Nil Nil

Compounding Nil Nil Nil Nil Nil

Annexure II FORM NO. AOC -2

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

Form for Disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in sub section (1) of section 188 of the Companies Act, 2013 including certain arms length transaction under third proviso thereto.

Financial Year 2017-18 . Details of contracts or arrangements or transactions not at Arm’s length basis.

SL. No. Particulars Details a) 1 Name (s) of the related party & nature of relationship Nil b) Nature of contracts/arrangements/transaction Nil c) Duration of the contracts/arrangements/transaction Nil d) Salient terms of the contracts or arrangements or transaction including the Nil value, if any e) Justification for entering into such contracts or arrangements or transactions’ Nil f) Date of approval by the Board Nil g) Amount paid as advances, if any Nil h) Date on which the special resolution was passed in General meeting as Nil required under first proviso to section 188

2. Details of contracts or arrangements or transactions at Arm’s length basis.

SL. No. Particulars Details

1 Name (s) of the related party & nature of relationship Dr. S .Rajkumar, Managing Director

Nature of contracts/arrangements/transaction Unsecured Loan

Duration of the contracts/arrangements/transaction Annual

Salient terms of the contracts or arrangements or transaction including Unsecured Loan – (Rs. 229.96 Lakhs) the value, if any

2 Name (s) of the related party & nature of relationship SreeGiriPackagings Limited, Company in which Directors hold more than 2% interest

Nature of contracts/arrangements/transaction Sale of goods

Duration of the contracts/arrangements/transaction Annual

Salient terms of the contracts or arrangements or transaction including Sale of goods – Rs. 6.99 lakhs the value, if any

10 Name (s) of the related party & nature of relationship Aditya Papers-Firm in which Directors hold more than 2% interest

Nature of contracts/arrangements/transaction Sale of Finished goods

Duration of the contracts/arrangements/transaction Annual

Salient terms of the contracts or arrangements or transaction including Rs. 31.34Lakhs the value, if any

11 Name (s) of the related party & nature of relationship Carto Packs, Firm of which Mr. S Rajkumar is the Managing Partner.

Nature of contracts/arrangements/transaction Purchase of Raw Material, and

Sale of Paper

Duration of the contracts/arrangements/transaction Annual

Salient terms of the contracts or arrangements or transaction including Sale of Finished goods –Rs.0.38 Lakhs the value, if any

12 Date of approval by the Board

13 Amount paid as advances, if any Nil

14 Date on which the special resolution was passed in general meeting (if 29-12-2017 any)

FOR AND ON BEHALF OF THE BOARD OF DIRECTORS

Sd/-

Chennai- 17 S RAJKUMAR 13-08-2018 (MANAGING DIRECTOR)

Annexure - III

ANNEXURES TO THE DIRECTORS’ REPORT

DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY

(A) CONSERVATION OF ENERGY

(i) Energy conservation measures taken:

At Kraft Paper Units

During the year, your Company has not taken any energy conservation measures as the manufacturing

units were forced to close down in June, 2016.

At Duplex Board Unit - NIL

(The factory remained closed)

(ii) Additional Investments and proposals, if any, being implemented for reduction of consumption of

Energy: NIL

(B) Technology absorption

(i) The efforts made towards technology absorption: NIL

(ii) Benefits derived Production improvement: NIL

Cost Reduction: NIL

Product development or import substitution: NIL

(iii) Imported Technology: NIL

(iv) Expenditure incurred on Research & Development: NIL

2016-17 2017-18

NIL Earnings in Foreign Exchange: NIL

NIL NIL Expenditure in Foreign Exchange:

MANAGEMENT DISCUSSION AND ANALYSIS REPORT mill was forced to close down in June, 2016 due to local interference in the pretext of pollution & ultimately withdrawal of pollution Industry clearances.

It is fact that paper is inevitable for the development of human race, The management is seriously considering various options of and the economy of country. The paper sector has witnessed a diversifications with the maximum utilization of the available supply glut on account of significant capacity addition in the writing, resources. In view of the increased environment sensitivity of the printing and paper segment over 2013-16. Demand, on the other country and the state in particular, the company is wary of moving hand, has not increased as expected. Performance of the industry is into any industry involving water, power, environmental clearances constrained due to high cost of production caused by inadequate and controls. After conducting various studies in this regard, we availability, high cost of raw materials, power cost and concentration have arrived at a conclusion of diversifying into Dry Chill Cold of mills in one particular area. Paper industry in India is still Storage (Logistics business). considered a smoke stack industry, environmentally hazardous, lacking glamorous high technology compared to developed world. Logistics business today is not mere warehousing. It is an end to end The magnitude of pollution is still a challenging problem before solution for making the goods available from the manufacturing industry. point to the end user. The gambit of logistics involves today various activities such as Storage, Just in time inventory maintenance, Opportunities and Threats Assembling, Import, Finishing, Billing, Delivery, Post clearance shipping / airlifting services. . It is very evident that the Our Companywas incorporated in the year 1991 with an installed development of logistics industry is utmost important for the capacity to produce 15 tonnes of kraft paper per day. The company industrial growth of a region. Our industry is situated close to ICT went for gradual expansion and upgradations and established three terminal in Cochin and located on the fringes of the seaport- airport Factories at an installed capacity of more than 100,000 MT per road with a high potential to be a big player in the logistic industry annum. For setting up the last Unit , the company mobilized funds providing local employment and generate sufficient revenue for the through public issue of shares and was successful in implementing state. the project within the scheduled time frame. The company reached the position of leading manufacturers of kraft paper in South India. Logistics Industry The Company was doing good business and employed over 300 people with more indirect employment continuously. The company The Indian Logistics sector has been instrumental in shaping the has gone for expansion in the year 2011-12 for technology nation’s growth over the last several years. It has evolved into upgradation and installation of power plant of 2 mega wattcapacity specialized sector and is becoming a key differentiator for all with Investment of Rs.35 Crores. Post expansion, the company has progressive businesses. The slowdown in the led to an overall gone through rough patch & suffered losses due to various reasons decline in the movement of goods and cargo across sectors such as such as Increase in the cost of raw materials and finance cost, auto, heavy engineering and capital goods. Nonetheless Pharma, Availability of cheaper paper from the imported sources and Cut FMCG, Retail and other sectors compensated for the decline. throat competition from new mills in Tamil Nadu. Kerala being situated in the southern most part of the country, the freight cost to The industry is expected to witness a healthy growth and with the the customers particularly in northern India is very high. Normally implementation of uniform tax structure of Goods and Service Tax Customers prefer to purchase from nearby mils to save on (GST), there would be increased demand for hub and spoke transportation cost. movements, large scale warehousing and specialized logistics services. New stringent pollution control norms and local interferences by vested interests is making it difficult to run the mill operations. The

Annexure – IV

REPORT ON CORPORATE GOVERNANCE

1. Corporate Governance Philosophy

The Management believes that corporate growth, goals, transparency and enhanced stakeholder value are to be achieved only through good Corporate Governance.

2. a) Board of Directors

The Board of Directors of the Company as on 31 March, 2018 comprised of:

Sl. Name Designation Executive/ Promoter/ No. of other Committee

No Non Executive Independent Companies in which he is a Member /Chairman Director Director in which he is a Director

ManagingDirec 1 Dr. S. Rajkumar tor & Vice Executive Promoter 06 01/3 Chairman

Mrs. RajeeRajkumar(w.e.f. Additional 2 Executive Non Independent 01 Nil/Nil 02.02.2018) Director

3 Mr.S.Subramoniam Director Non Executive Non-Independent 04 Nil/Nil

4 Mrs.E.Kamalam Director Non Executive Non-Independent Nil Nil

5 Mr.U.GururajaBhat Director Non Executive Independent 02 4/1

6 Mr. G. Raghavan Director Non Executive Independent 01 3/1

7 Mr. N. Subramanian Director Non Executive Independent 03 5/1

Mr.AkhileshAgarwal (w.e.f. 8 Director Non Executive Non-Independent 08 1/1 24.06.2017)

During the Year, Mr. A Padmanabhan, Director, Mr. S Giridhar, 2b) Performance Evaluation: Director were resigned from the Board. Pursuant to the provisions of the Companies Act, 2013, the Board Dr. S Rajkumar and S Subramaniam are sons of Mrs.EKamalam and has carried out the annual Performance Evaluation of its own Mrs.RajeeRajkumar is wife of Mr. S Rajkumar and none of the other performance, the Directors Individually as well as the working of its Directors of your Company are inter-se related to each other. Committees.

PECUNIARY RELATIONSHIP OR TRANSACTIONS OF NON-EXECUTIVE Various aspects of the Board’s functioning were evaluated such as DIRECTORS: adequacy of the composition of the Board and its Committees, Board Culture, execution and performance of specific duties, During the year, there were no pecuniary relationships or obligations and governance. transactions between the Company and any of its Non-Executive Directors apart from sitting fees. A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who wer

36 e evaluated on parameters such as level ofengagement and contrib During the year 2017-18, Six Board Meetings were held on 3rd April, ution, independence of judgment,safeguarding the interest of the C 2017, 24th June, 2017, 27th September 2017, 29th December, 2017, ompany and its minority shareholders etc. 02th February, 2018 and 12th February 2018. The Annual General Meeting was held on 29th December, 2017. The performance evaluation of the Independent Directors was carri ed out by the entire Board. The performance evaluation of the Chai Attendance of each director, at the Board Meetings held during the rman and the Non Independent Directors was carried out by the In year 2017- 18 and at the last Annual General Meeting is as follows: dependent Directors. The Directors expressed their satisfaction wit h the evaluation process.

3. Board Meetings and Annual General Meeting & Directors’ Attendance

Sl. Name Board Meetings Last AGM No.

Held Attended Attended

1 Dr. S. Rajkumar 6 6 Yes

2 Mr. A. Padmanabhan 4 1 No

3 Mr.S.Giridhar 4 0 No

4 Mr.S.Subramoniam 6 2 No

5 Mrs.E.Kamalam 6 1 No

6 Mr.U.GururajaBhat 6 5 Yes

Mr. G Raghavan 7 6 5 Yes

Mr. N. Subramanian Yes 8 6 6

9 RajeeRajkumar 2 2 Yes

4. Audit Committee Statutory Auditors/ internal auditors and fix their remuneration; approval or any subsequent modification of transactions of the By constituting an independent and qualified Audit Committee, the company with related parties; scrutiny of inter-corporate loans and Company has complied with the requirements of Section 177 of the investments; valuation of undertakings or assets of the company, Companies Act, 2013 and Regulation 18 of the SEBI (Listing wherever it is necessary;evaluation of internal financial controls Obligation & Disclosure Requirements) Regulation, 2015 relating to and risk management systems and monitoring the end use of funds the composition of the Audit Committee. The Committee reviews: raised through public offers and related matters. the financial reporting by ensuring compliance with Accounting Standards and review Financial Policies of the Company; review The Audit Committee consists of the following members: and monitor the auditor’s independence and performance, and effectiveness of audit process; recommend the appointment of

No. of Meeting Sl. Independent / Non Name Designation Attended Independent No.

1 Mr. U. GururajaBhat Member Independent 4

2 Mr. G Raghavan Member (w.e.f. 24.06.2017) Independent 4

Chairman (w.e.f 3 Mr. N. Subramanian Independent 24.06.2017) 4

During the year 2016-17, Four Audit Committee Meetings were held 24th June, 2017, 27th September 2017, 29th December, 2017 and 12th February 2018

5. Nomination & Remuneration Committee

Nomination & Remuneration Committee consists of the following members:

Sl. No. of Meeting Independent / Non Name Designation Independent No. Attended

1 Mr. U. GururajaBhat Member Independent 1

Chairman (w.e.f. 2 Mr. G Raghavan Independent 1 24.06.2017)

3 Mr. N. Subramanian Member (w.e.f. 24.06.2017) Independent 1

During the year 2017-18, Two Nomination and Remuneration Committee Meeting was held.

5a) Remuneration to Directors 6. Shareholders Relationship Committee

Remuneration to Managing Director/ Whole-time Director as The Shareholders Relationship Committee’s composition and the recommended by the Nomination and Remuneration Committee is terms of reference meet with the requirements ofprovisions of the approved by the Board of Directors within the ceiling prescribed Companies Act, 2013. under Schedule V to the Companies Act, 2013. The same is also approved by the Members of the Company in General Meeting. No It is primarily responsible to consider and review all matters Sitting Fee is paid to the Managing Director / Whole-time Director. connected with the Company’s transfer of securities and redressal of shareholders/ investors/ security holders’ complaints and The Non-Executive directors are remunerated by way of sitting fees as decided by the Board of Directors of the Company from time to resolve the grievances of security holders of the Company. time for attending Board/ Committee meetings. The Shareholders Relationship Committee consists of the following The Company has not granted any stock option to any of its members: Directors. Details of remuneration paid to the Directors are given in

Extract of Annual Return in Form MGT – 9 at Annexure I.

Sl. Name Designation Independent / Non Independent

No.

1 Dr S. Rajkumar Chairman Non-Independent

2 Mr. U. GururajaBhat Member Independent

3 Mr. N Subramanian Member Independent

7. Status of Investor Grievances

Name & designation of compliance officer Mr.R. Ponnambalam, Company Secretary

Number of shareholders complaints received during 2017-18 Nil

Number of complaints resolved to the satisfaction of shareholders Nil

Number of pending complaints as on 31.03.2018. Nil

8. Risk Management Committee.

Our risk Management Committee comprises the following Members:

Sl. Name Designation Independent / Non Independent

No.

1 Mr. U. GururajaBhat Chairman Independent

2 Mr. G Raghavan Member Independent

3 Mr. N Subramanian Member Non Independent

The purpose of the committee is to assist the Board in fulfilling its The Company’s Risk Management Policy is placed in the Company’s corporate governance duties by overseeing the responsibilities website www.sreekailas.com with regard to the identification, evaluation and mitigation of operational, strategic and environmental risks. The committee has the overall responsibility of monitoring and approving the risk policies and associated practices of the Company.

9. Corporate Social Responsibility Committee

The Corporate Social Responsibility Committee consists of the following members:

Sl. Name Designation Independent / Non Independent No.

Mr. AkhileshAgarwal 1 Member Non Independent

Dr. S Rajkumar 2 Chairman Non Independent

Mr. N Subramanian 3 Member Independent

10. Share Issue / Transfer Committee

The Share Issue/Transfer committee meeting consists of the following members:

Sl. Name Designation Independent / Non Independent

No.

1 Dr S. Rajkumar Non-Independent Chairman

2 Mr. G Raghavan Member Independent

3 Mr.N Subramanian Member Independent

During the year 2017-18, One Share Issue/Transfer Committee Meeting was held.

11. Machinery Disposal Committee

The Machinery Disposal meeting consists of the following members:

Sl. Name Designation Independent / Non Independent

No.

1 Dr S. Rajkumar Non-Independent Chairman

2 Mr. G Raghavan Member Independent

3 Mr.N Subramanian Member Independent

During the year 2017-18, Three Machinery Disposal Committee Meeting was held.

12. Project Finance Committee and they are being reviewed periodically. The Risk Management Policy is uploaded in the Company Website www.sreekailas.com. A Project Finance Committee was constituted during the financial year 2007-08 for implementation of new diversified projects. The 14. CEO /CFO Certification Committee consists of Dr. S. Rajkumar and Mr. S. Subramoniam. No meeting of the committee was held during the year under review. A Certificate from CEO and CFO has been placed before the Board confirming that: 13. Code of Conduct (a) They have reviewed financial statements and the cash flow The code of Conduct for all the members of the Board and senior statement for the year and that to the best of their knowledge management of the Company has been posted on the website of and belief: the Company: www.sreekailas.com. All Board members and senior management personnel (as per Regulation 26(3) of the Listing (i) These statements do not contain any materially untrue Regulations) have affirmed compliance with the applicable Code of statement or omit any material fact or contain statements Conduct. A declaration to this effect forms part of this Report. that might be misleading;

13a. Disclosures on materially significant related party (ii) these statements together present a true and fair view transactions i.e. transactions of the Company of material nature of the company’s affairs and are in compliance with existing with its promoters, the directors or the management, their accounting standards, applicable laws and regulations. relatives, etc. that have potential conflict with the interest of the (b) There are, to the best of their knowledge and belief, no Company at large. transactions entered into by the Company during the year None of the transactions with any of the related parties were in which are fraudulent,illegal or violation of the company’s code conflict with the interest of the Company. Attention of the of conduct. members is drawn to the disclosures of (c) They accept responsibility for establishing and maintaining transactions with the related parties set out in Notes on Accounts internal controls and that they have evaluated the forming part of the Annual Report. All related party transactions effectiveness of the internal control systems of the company are negotiated on arms length basis and are only intended to and they have disclosed to the auditors and the Audit further the interests of the Company. Companies Policy on Related Committee, deficiencies in the design or operation of internal Party is uploaded in the Company Website www.sreekailas.com. controls, if any, of which they are aware and the steps they 13b. Details of non-compliance by the Company, penalties, have taken or propose to take to rectify these deficiencies. strictures imposed on the Company by the Stock Exchange or SEBI or any other statutory authority, on any matter related to the (d) They have indicated to the auditors and the Audit Committee: capital markets, during the last three years. (i) Significant changes in internal control during the year; There has been no instance of non-compliance by the Company on any matter related to Capital Markets during the last three years (ii) Significant changes in accounting policies during the year and hence no penalties or strictures have been imposed on the and that the same have been disclosed in the notes to Company by the Stock Exchange or SEBI or any other Statutory the financial statements; and Authority. (iii) They have not come across any instances of significant 13c. Disclosures on Accounting Treatment fraud and involvement therein, if any, of the management or an employee having a significant role in Disclosures of accounting treatment wherever applicable have the company’s internal control system. been made in the Audited Financial Accounts for the year ended 31st March, 2018 Particulars of Employees

13d. Board Disclosures – Risk Management None of the employees of the company fall under the provisions of section 197(12) of the Companies Act, 2103, read with Rule 5(1) of The Company has laid down procedures to inform the Board the Companies (Appointment and Remuneration of Managerial Members about the risk assessment and minimization procedures Personnel) Rules, 2014.

Following statement containing the details of the Remuneration of Information pursuant to Section 197(12) of the Companies Act, Directors, KMPs and Employees as required under Section 197(12) 2013 read with rule 5(1) of the Companies (Appointment and of the Act, read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel), Rules 2014 1) Ratio of the remuneration of each Director / KMP to the Remuneration of Managerial Personnel) Rules, 2014. median remuneration of all the employees of the Company in the FY 2017-18 Median remuneration of all the employees of the Company NIL for the Financial Year 2017-18

Percentage increase in the median remuneration of the NIL employees in the Financial year 2017-18

Number of permanent employees on the rolls of the Company 12 as on 31st March 2018

2) The percentage of increase in remuneration of the Non-executive Chairman, President and CEO , Sr. Vice President, CFO and Company Secretary

# Name of the Designation Remuneration % increase in

Director / KMP during the FY Remuneration

2017-18 during FY 2017-18

1 V N Sridharan CFO 3,60,000 0%

2 R Ponambalam Company Secretary 0 0%

3) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration: There were no change in the salary of both the employees and KMP

4) The remuneration is as per the remuneration policy of the Company. Sr. No Name Designation Remuneration Nature of Qualification Experience (No. Date of Age (in Last Employment % of equity shares Whether any such Received (Per annum) employment - of Years) commencement of years) and Designation held by the employee is a whether employment employee in the relative of any contractual or company director or otherwise manager of the company and if so, name of such director or manager

Employment started in Sree Sr. manager Diploma sakthi paper Mills 1 RATHEESH K PAI (Electrical) 389,917.00 Permanent Electrical) 21 01/03/1993 54 Ltd - no

Chief Commerical Sree giri Packaging 2 AYYAPPAN PILLAI S officer 357,500.00 Permanent BA 2 10/01/2017 65 Ltd. , Manager - no Employment started in Sree sakthi paper Mills 3 VINODKUMAR V DGM 340,220.00 Permanent BA, LLB 22 02/02/1996 56 Ltd - no Hindustan Chartered Newsprint Ltd, 4 SRIDHARAN V N CFO 321,500.00 Permanent Accountant 40 01/10/2016 66 Director and CEO - no Employment started in Sree Sr.Manager- Finance sakthi paper Mills 5 PARVATHY P & Accounts 316,052.00 Permanent Mcom 25 04/01/1993 55 Ltd - no Employment started in Sree sakthi paper Mills 6 JAYAKUMAR . M Dy.General Manager 279,860.00 Permanent Bcom 25 18/03/1993 53 Ltd - no Employment started in Sree Company sakthi paper Mills 7 SARANYA . N.M Company secretary 238,000.00 Permanent Secretary 1 01/02/2017 28 Ltd - no Employment started in Sree sakthi paper Mills 8 LATHEEF K.K Security in charge 231,088.00 Permanent BA 7 07/02/2011 47 Ltd - no Employment started in Sree sakthi paper Mills 9 LIYA JOSHI Sr.Executive 204,417.00 Permanent Msc 3 14/05/2015 44 Ltd - no Sr.Executive VM Santhosh & 10 BETSI RANI T.B accounts 192,810.00 Permanent Mcom. 13 21/11/2005 39 Co,Executive - no

15. Annual General Meetings

The details of the last 3 Annual General Meetings and Special Resolutions passed by the Company are noted below:

Year Location Date Time Special Resolution

1. Appointment of Mr. A. R. K. Rao as an Independent Director.

Hotel Abad Plaza 2. Approval of Related Party Transaction.

M.G.Road, Ernakulam Wednesday 3. Re-appoint Dr. S. Rajkumar as Managing Director. 2015 2.00PM Cochin – 35 30.09.2015 4. Re-appointment of Mr. N. PurushothamaPrabhu as Whole Time Director and fixing his remuneration.

5. Re-appointment of Mr. A. Padmanabhan as Executive Director of the Company and fixation of remuneration.

1. Appointment of Mr. VenkataMangeswaraRaoVarrey (DIN Hotel Abad Plaza 0630043) Additional Director and as a Whole time Director and fixing his remuneration. M.G.Road, Ernakulam Friday 2016 2.00PM 2. Approval of Related Party Transaction. Cochin – 35 30.12.2016 3. Re-appoint Dr. S. Rajkumar as Managing Director.

1. Change in name of the Company

2. Appointment of G Raghavan as an Independent Director Hotel Abad Plaza 3. Appointment of N Subramanian as an Independent Director M.G.Road, Ernakulam Friday 2017 2.00PM 4. Appointment of AkhileshAgarwal as an Independent Director Cochin – 35 29.12.2017 5. Approval of Related Party Transaction.

6. Re appointment of S Rajkumar as Managing Director

There was one resolution passed by the Company’s members through Postal Ballot during last year.

Year Declaration date Resolutions

2017-18 24.06.2017 1. Authorizing the Board to sell immovable assets 2. Alteration of Object clause of MOA 3. Issuance of11.25% non convertible cumulative redeemable preference shares

2017-18 12.02.2018 1. Authorizing the Board to sell Plant and Machinery

2. Issuance of11.25% non convertible cumulative redeemable preference shares

2017-18 24.03.2018 1. To approve the revised terms of existing loan borrowed by the Company in accordance with Sec.62(3) and other applicable provision if any of the Companies Act, 2013including proviso to convert into shares.

2. To Convert Rs. 3 Crores loan of Mr.SRajkumar into shares and consider issue of convertible warrants at a price of Rs.11

3. Change the name of the Company

16. Means of Communication:

The Company’s corporate website, www.sreekailas.com provides comprehensive information to the Shareholders.The Financial Results are generally published in ‘Business Standard’, in English and in ‘Mangalam’, in Malayalam. The Results are also placed on the Company’s Web Site, www.sreekailas.com. The Company also usually sending shareholders letters along with copy of results directly to the investor on quarterly basis as part of good corporate governance measure.

17. General Shareholder Information:

AGM: Date, time & venue : Saturday, 29 September, 2018, 2.00P.M at Hotel Abad Plaza, M.G.Road Cochin – 35

: Financial Year April 01 to March 31

: June 2018 Audited results for 2017-18

August 2018 First Quarter Results for 2018-19

September 2018 Annual General Meeting for 2017-18

November 2018 Second Quarter Results for 2018-19 Financial Calendar(tentative and subjectto change) February 2019 Third Quarter Results for 2018-19

March 2019 Review of performance 2018-19

May 2019 Audited results for 2018-19

September 2019 Annual General Meeting for 2018-19

Date of Book closure : 20.09.2018 to 29.09.2018 (both days inclusive)

Dividend Payment Date : No Dividend Declared

: The Stock Exchange, Mumbai PhirozeJeejeebhoy Towers Dalal Street Mumbai 400 001 Ph: (91)(22)2272 1233 - 1234 (General) 2272 1121 - 1122, 2272 2375 (Corporate Relations Listing on Stock Exchanges Department) Web Site: www.bseindia.com E-mail: [email protected] Fax: (91)(22)2272 1919, 2272 3027 (General) 2272 3719, 2272 2039, 2272 2061 2272 3121, 2272 2037, 2272 2041 (Corporate Relations Department)

Payment of Annual Listing Fees to the Listing Fee has been paid to the Stock Exchange, in which the Company’s Equity Shares are Stock Exchange listed, uptoMarch 31, 2019

: Under Demat System the ISIN allotted to the Company’s Equity Shares is : INE266H01014 The Company’s Stock Code is 532701 Stock Code

Market Price Data (BSE) * Spread Month Open High Low Close H-L C-O

Apr-17 6.95 8.5 6.04 7.12 2.46 0.17

May-17 7.03 7.81 5.5 5.93 2.31 -1.1

Jun-17 6.35 6.35 4.05 4.99 2.3 -1.36

Jul-17 5.23 5.23 3.9 4.17 1.33 -1.06

Aug-17 4.1 4.9 3.27 3.98 1.63 -0.12

Sep-17 3.5 4.81 3.45 4.1 1.36 0.6

Oct-17 3.91 4.7 3.7 4.45 1 0.54

Nov-17 4.03 5.9 3.55 4.88 2.35 0.85

Dec-17 4.02 8.63 4.01 8.63 4.62 4.61

Jan-18 9.06 11.65 8.05 8.49 3.6 -0.57

Feb-18 8.9 11.03 8.8 11.03 2.23 2.13

Mar-18 11.55 11.58 7.55 7.55 4.03 -4

: Registrar and Transfer M/s. Bigshare Services Private Limited, E/2, Ansa Industrial Estate, Saki Vihar Road, Sakinaka, Andheri (E), Agents and Share transfer Mumbai - 400 072, Tel: 022-28470652, Fax: 022-28475207". Both physical and demat transfers are done System through the Registrar and Transfer Agents. The shares of the Company are under compulsory demat mode.

: Distribution No. of share % of share No. of shares % of share Distribution of Shareholding Holder Holders holding as on 31st March 2018 1 – 5000 6894 80.83 12965870 7.89

5001-10000 842 9.87 6594110 4.01

10001-20000 347 4.07 5472670 3.33

20001-30000 109 1.28 2834260 1.72

30001-40000 74 0.87 2655700 1.62

40001-50000 57 0.67 2720200 1.4225

50001-100000 91 1.07 6439620 4.3216

100001 & above 115 1.35 13327970 75.86

TOTAL 8529 100.00 17296217 100.00 : Category No. of shares % of share Shareholding pattern as on No. of share held holding 31st March, 2018 Holder A. Promoters Holdings Promoter & promoter group 8303378 48.01 B. Non Promoters Holding 8992839 51.99 Public 7507908 43.41 Corporate Bodies 578202 3.34 NRI 883212 5.11 NBFC’s registered with RBI 200 0.00 Clearing Member 7301 0.04 Directors & Relatives 16016 0.09

Grand Total 17296217 100.00

Name No. of shares % of Category Name and number of shares held share held and percentage share holding holding of entities / persons S RAJKUMAR 5530114 31.973 PROMOTERS - RESIDENT INDIANS holding more than 1% shares of the Company as on AYYAPPAN PADMANABHAN 1294658 7.485 DIRECTORS - RESIDENT INDIANS 31.03.2018 NON RESIDENT INDIAN - NON- RESIDENT INDIANS (NON- RAJA RAM 717689 4.149 REPATRIABLE)

S GIRIDHAR 713223 4.124 PROMOTERS - RESIDENT INDIANS

Anand Mohan 334000 1.931 PUBLIC - RESIDENT INDIANS

RAJEE RAJKUMAR 285544 1.651 RELATIVES OF DIRECTOR - RESIDENT

INDIANS

SUBRAMANIAM SIVATHANU PILLAI 232840 1.346 PUBLIC - RESIDENT INDIANS

PARANJOTHI SUNDARAM 221455 1.28 PUBLIC - RESIDENT INDIANS

BALRAM BHARWANI 200000 1.156 PUBLIC - RESIDENT INDIANS

TOTAL 9529523 55.06

: Dematerialization of shares Break up of Shares as on 31/03/2018 and liquidity a) In dematerialized mode NSDL - 13788321 CDSL - 3496048 b) In Physical mode 11848 Total - 17296217 100% of Shares of Promotor and Promoters group were dematerialized pursuant to SEBI Circular No: ISD /3/2011 dt. 17.06.2011. Outstanding GDRs / ADRs : /Warrants or any Convertible Nil instruments, conversion date and likely impact on equity

: Plant Locations Kraft Paper Unit I Industrial Development Area, Muppathadom, Edayar, Aluva - 682 102, Kerala; Kraft Paper Unit II Industrial Development Area, Muppathadom, Edayar, Aluva - 683 102, Kerala; Address for correspondence : SreeSakthi Paper Mills Limited 57/2993, “Sree Kailas”, Paliam Road, Ernakulam, Cochin - 682 016, Kerala Tel: 0484 -3002000 Email: [email protected], Web: www.sreekailas.com DECLARATION-

All the members of the Board of Directors of the Company and Senior Management of the Company have affirmed compliance of the Code of conduct for the year ended 31st March 2018. The Code of Conduct laid down for all Board members and Senior Management of the Company is posted on the website of the Company. Chennai – 17 Sd/- 13-08-2018 Dr. S. Rajkumar Managing Director

ANNEXURE - V (a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and SECRETARIAL AUDIT REPORT FOR THE FINANCAL YEAR ENDED Takeovers) Regulations, 2011; 31.03.2018 (b) The Securities and Exchange Board of India [Pursuant to section 204(1) of the Companies Act, 2013 and (Prohibition of Insider Trading) Regulations, rule No.9 of the Companies (Appointment and Remuneration 2015; Personnel) Rules, 2014] (c) The Securities and Exchange Board of India To (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the The Members Companies Act, 2013 and dealing with SREE SAKTHI PAPER MILLS LIMITED client.

We have conducted the secretarial audit of the compliance of (i) The Securities Exchange Board of India applicable statutory provisions and the adherence to good (Listing Obligations and Disclosure corporate practices by SreeSakthi Paper Mills Limited Requirements) Regulation, 2015 (hereinafter called the company). Secretarial Audit was We have also examined compliance with the applicable clauses conducted in a manner that provided us a reasonable basis for of the following: evaluating the corporate conducts/statutory compliances and expressing our opinion thereon. i. Secretarial Standards issued by The Institute of Company Secretaries of India Based on our verification of the Company’s books, papers, ii. The SEBI (LODR) 2015 entered into by the minute books, forms and returns filed and other records Company, where the equity shares of the maintained by the company and also the information provided Company are listed. by the Company, its officers, agents and authorized iii. The below mentioned are the laws/ Regulations representatives during the conduct of secretarial audit, We (as amended from time to time), as informed hereby report that in our opinion, the company has, during the and certified by the management of the audit period covering the financial year ended on 31st March, Company which are specifically applicable to the 2018, complied with the statutory provisions listed hereunder Company based on their industry; and also that the Company has proper Board-processes and • Forest (Conservation) Act, 1980 compliance-mechanism in place to the extent, in the manner • Chemical Accidents (Emergency Planning, and subject to the reporting made hereinafter: Preparedness and Response) Rules, 1996 We have examined the books, papers, minute books, forms and • Indian Boilers Act, 1923 returns filed and other records maintained by SreeSakthi Paper • The Air (Prevention and control of Mills Limited (“the Company”) for the financial year ended on Pollution) Act, 1981 31st March, 2018 according to the provisions as applicable to • The Water (Prevention and control of the Company during the period of audit: Pollution) Act, 1974 • Hazardous Wastes (Management and (i) The Companies Act, 2013 (the Act) and the rules Handling) Rules, 2016 made thereunder; • Environment Protection Act, 1986. (ii) The Depositories Act, 1996 and the Regulations and • Employees Provident Fund and Bye-laws framed thereunder to the extent of Miscellaneous Provisions Act, 1952 Regulation 55A; • Employees' State Insurance Act, 1948 • The Contract Labour (Regulation & Abolition) Act, 1970 (iii) The following Regulations and Guidelines prescribed • The Factories Act, 1948 under the Securities and Exchange Board of India Act, • The Industrial Disputes Act, 1947 1992 (‘SEBI Act’):- • The Workmen’s Compensation Act, 1923

& Rules

• Payment of Gratuity Act 1972 & Rules The Board of Directors of the Company is constituted with a • The Payment of Bonus Act, 1965 balance of Executive Directors, Non-Executive Directors and • The Minimum Wages Act, 1948 Independent Directors. The changes in the composition of the • The Maternity Benefit Act, 1961 Board of Directors that took place during the period under • Apprentices Act, 1961 review were carried out in compliance with the provisions of During the period under review, the Company has complied the Act. with the provisions of the Act, Rules, Regulations, Guidelines, Standards, etc., mentioned except (iii) above; Notices were given to all directors to schedule the Board Meetings, Committee Meetings, agenda (except delay from due 1. Delay in filing forms and returns with ROC and also date) and detailed notes on agenda were delivered and a few instances of delay in complying with the system exists for seeking and obtaining further information and provisions of SEBI (LODR). clarifications on the agenda items before the meeting and for meaningful participation at the meeting.All decisions at Board 2. Non compliance of the provisions of Section 126 of Meetings and Committee Meetings are carried out the Companies Act, 2013 due to technical unanimously as recorded in the minutes of the meetings of the reconciliation of bank account by RTC Board of Directors or Committee of the Board, as the case may

be. 3. Penalties paid for delay in filing audited and unaudited financial statement to Stock Exchange for We further report thatduring the audit period the company has th the quarter ended 30 June 2017, 30 September no specific events / actions having a major bearing on the 2017 and 31 March 2018. company’s affairs in pursuance of the above referred laws, Further report that there were no actions/events occurred in rules, regulations, guidelines, standards, etc. referred to above. the pursuance of except:

i. The Securities and Exchange Board of India (Issue of 1. The company has Redeemed its 11.25% Non- Capital and Disclosure Requirements) Regulations, convertible Cumulative Preference shares face value 2009; of Rs.10/-each by fresh issue of shares upto ii. The Securities and Exchange Board of India (Share 10,00,000 shares through postal ballot dated Based employee Benefits) Regulations, 2014; 23.06.2017 iii. The Securities Exchange Board of India (Issue and

Listing of Debt Securities) Regulation, 2008 2. The Company has diversified its business and also iv. The Securities Exchange Board of India (Delisting of altered the Memorandum of Association accordingly Equity Shares) Regulation, 2009 through postal ballot dated 23.06.2017. v. The Securities Exchange Board of India (Buyback of 3. Factory situated at Chalakudy has been sold after Securities) Regulation, 1998 obtaining approval through postal ballot dated 23.06.2017 vi. Foreign Exchange Management Act, 1999 and the 4. All the main plant items except co generation plant rules and regulations made thereunder requiring (Power boiler and generator) situated at Edayar compliance thereof by the Company during the have been sold through postal ballot dated Financial Year under review. 27.09.2017. We further report that, since the factory is closed the above 5. A demand notice under Insolvency and Bankruptcy Laws mentioned in (iii) was not complied due to the non Code, 2016 in form 3 was served on the Company on operational status of the Company. 7th March 2018 for non-payment of dues upto 13.92 We further report, that the compliance by the Company of Lacs, which the Company has agreed to settle before applicable financial laws, like direct and indirect tax laws, has NCLT on 27.07.2018 not been reviewed in this Audit since the same have been Sd/- Place: Chennai N. Srividhya subject to review by statutory financial auditor and other Date:13th August 2018 Mem No:34428 designated professionals. C.P.NO. 14058

We further report that

“Annexure A” 3. We have not verified the correctness and (To the Secretarial Audit Report of M/s. SreeSakthi Paper Mills appropriateness of financial records and Books of Limited for the financial year ended 31.03.2018) Accounts of the Company. To 4. Where ever required, we have obtained the The Members Management representation about the compliance Sree Sakthi Paper Mills Limited and law, rules and regulation and happening of Our Secretarial Audit Report for the financial year ended events etc. 31.3.2018 is to be read along with this Annexure A. 5. The compliance of the provisions of Corporate and other applicable laws, rules, regulation, standards is 1. Maintenance of Secretarial record is the responsibility the responsibility of the management. Our of the management of the Company. Our examination was limited to the verification of responsibility is to express an opinion on these procedure on test basic. secretarial records based on our audit. 6. The Secretarial Audit report is neither an assurance as 2. We have followed the audit practices and the to the future viability of the Company nor of the processes as were appropriate to obtain reasonable effectiveness with which the management has assurance about the correctness of the contents of conducted the affairs of the Company. the secretarial records. The verification was done on Sd/- test basic to ensure that correct facts are reflected in Place: Chennai N. Srividhya Date:13th August 2018 Mem No:34428 secretarial records. We believe that the processes C.P.NO. 14058 and practices we followed provide a reasonable basic

for our opinion. Compliance Certificate of the Auditors To

The Members of Sree Sakthi Paper Mills Limited, We have examined the Compliance of conditions of Corporate Governance by Sree Sakthi Paper Mills Limited (the “company”) for the year ended March 31st, 2018 as stipulated in chapter IV of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 pursuant to the Listing Agreement of the said Company with stock exchanges.

The Compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the company.

In our opinion and to the best of our information and according to the explanations given to us, subject to the following: (i) No Independent Director on Board has been appointed as a Director on Board of Unlisted Material subsidiaries. (ii) Submission of the Audited standalone financial results for the financial year and quarterly standalone financial results in the first two quarters was delayed beyond the permitted due date. (iii) No internal audit was conducted during the year we certify that the company has complied with the conditions of Corporate Governance as stipulated in the provisions as specified in chapter IV of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 pursuant to Listing Agreement of the said Company with stock exchanges.

We further state that such complaint is neither an assurance as to the future viability of the company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company. For KPR & Co Chartered Accountants FRN: 5326S Sd/- Deepa Praveen, ACA Kochi -11 Memb No: 232410 13.06.2018 Partner

Annexure VI

ANNUAL REPORT ON CSR ACTIVITIES FOR THE FINANCIAL YEAR 2017-18

[Pursuant to clause (o) of sub-section (3) of section 134 of the Act and Rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014]

1 Brief outline of the Company’s CSR policy, NIL projects and programs proposed to be undertaken with web-link to CSR policy and projects or programs

2 Composition of the CSR Dr. S Rajkumar, Managing Director, Mr. N Subramanian, Independent Director and Mr. AkhileshAgarwal, Director Committee.

3 Average Net profits of the company for the last (Loss Rs. 2040.17 lakhs) three financial year

4 Prescribed CSR expenditure (Two percent of NIL the amount in item no. 3 above)

5 Details of CSR Spent during the Financial Year Amount budgeted for the year 2017-18 : Nil

Amount spent upto 31.03.2018 : Nil

Amount Unspent if any : Nil

Manner in which the amount was spent during the financial year ended 31.03.2018

CSR Sector in Projects or Amount Amount spent on Cumulative Amount project which the projects or spent programs (1) local area or Outlay (budget) programs sub- expenditure activity the project other (2) specify the state & heads: (1) Direct up to Direct or project or is district where projects or expenditure on through the reporting programs were projects or covered programs wise implementi programs (2) over undertaken period ng heads

agency

NIL NIL NIL NIL NIL NIL NIL

Sd/-

Dr. S. Rajkumar

Managing Director

Independent Auditor’s Report

The Members of M/s.Sree Sakthi Paper Mills, Kochi.

Report on the Standalone Financial Statements

We have audited the accompanying Standalone Financial Statements of M/s. Sree Sakthi Paper Mills, Kochi, [CIN: L21012KL1991PLC006207] which comprises of:-

(a) The Balance Sheet as at 31st March, 2018 (b) The Statement of Profit and Loss for the year (including other comprehensive income) ended 31st March, 2018 (c) Statement of Changes in Equity for the year ended 31st March, 2018 (d) Cash Flow Statement for the year ended 31st March, 2018; and (e) A Summary of Significant Accounting Policies and other explanatory information.

Management’s responsibility for the financial statements

The Company’s Board of Directors are responsible for the matters stated in Section 134(5) of the Companies Act 2013(“the Act”) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the company in accordance with the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, and other accounting principles generally accepted in India.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under and the order passed under Section 143(11) of the Act. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the standalone financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the standalone financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Company’s Directors, as well as evaluating the overall presentation of the standalone financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India of the state of affairs of the Company as at March 31, 2018; and its LOSS, total comprehensive income, the changes in equity and its cash flows for the year ended on that date.

Emphasis of Matter

We invite the attention of the users to – (a) Note No. 2(e) of the Significant Accounting Policies regarding the validity of Going Concern assumption for the company in preparation of the standalone financial statements; (b) Note No. 13 of the Significant Accounting Policies regarding lack of external confirmation of balances for receivables and payables including balances due to / from group concerns.

Our report is not qualified in respect of the above matters.

Report on other legal and regulatory requirements 1) As required by the Companies (Auditor’s Report) Order, 2016 (“The Order”) issued by the Central Government of India in terms of sub-section 11 of section 143 of the Act, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the Order to the extent applicable.

1) As required by section 143(3) of the Act, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books.

c) The Balance Sheet, Statement of Profit and Loss including other comprehensive income, Statement of changes in Equity, and Cash Flow Statement dealt with by this Report are in agreement with the books of account

d) In our opinion, the aforesaid financial statements comply with the Indian Accounting Standards specified under section 133 of the Companies Act, 2013, read with Rule 7 of Companies (Accounts), Rules 2014

e) On the basis of written representations received from the directors as on March 31, 2018, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018, from being appointed as a director in terms of sub- section (2) of section 164 of the Act.

f) The report on internal financial control as required under clause (i) of sub section 3 of section 143 of the Companies Act 2013 is attached as Annexure B.

g) With respect to other matters to be included in the Auditors Report in accordance with Rule 11 of Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i) The company has disclosed the impact of pending litigations on its financial position in its financial statements. ii) The company has made provisions, as required under any law or accounting standard, for material foreseeable losses, if any, on long term contracts including derivative contracts. iii) iii) The company has not transferred the equity shares corresponding to Unpaid dividend where the specified period under 124 (5) has been completed, within the due date of 31st October 2017. However there has been no delay in transferring such unpaid dividends to Investor Education and Protection fund by the company.

For KPR & Co Chartered Accountants FRN: 5326S

Sd/- Deepa Praveen, ACA Kochi -11 Memb No: 232410 13.06.2018 Partner

Ref: M/s. Sree Sakthi Paper Mills Limited, Kochi -16 (2017-18)

Annexure A: Referred to in paragraph 1 of ‘Report on other Legal and Regulatory requirements’ of our report of even date-

(i) In respect of the fixed assets – (a) The Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets. (b) The fixed assets have been physically verified by the management at reasonable intervals and the discrepancies noticed have been properly dealt with in the books of accounts. (c) According to the information and explanation given to us, the title deeds of immovable properties of the Company are held in the name of the Company, except for 1.75 acres of industrial land in the possession of the Company at Edayar, purchased in financial year 2012-13. We are informed that the company has paid the entire purchase consideration and is waiting for final clearance for effecting legal transfer of ownership.

(ii) The inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable. The discrepancies noticed on verification between the physical stocks and the book records were not material and have been properly dealt with in the books of account.

(iii) (a) The Company has not granted any loans, secured or unsecured, to Companies, firms, LLPs, or other parties covered in the register maintained under Section 189 of the Companies Act, 2013, except for unsecured loans Rs. 5.36 lakhs, Rs.5.36 lakhs and Rs. 7.11 lakhs advanced to the subsidiary companies M/s Sree Adisakthi Mukkuttathode Hydropower Limited, M/s Jalashaayi Alamparathodu Hydro power Limited and M/s Sree Kailas Palchuram Hydro power Limited respectively prior to 2013. However the above loans were repaid by the respective borrowing companies during the year.

(b) The terms and conditions of the above loans granted are not prejudicial to the interest of the company. (c) The company has not stipulated any schedule of repayment of principal.

(iv) In our opinion and according to the explanations given to us, the Company has complied with the provisions of the Sections 185 and 186 of the Act in respect of the grant of loans, making investments and providing guarantees and securities made by it. The company had granted loans/advances to subsidiary companies as given in iii(a) above, which we were informed by the company that the provisions of section 185 and 186 are not applicable as the were made before 12th September 2013 being the effective date of Sec 185 of Companies Act 2013.

(v) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits during the year. Therefore, the provisions of clause 3 (v) of the Companies (Auditor’s Report) Order, 2016, are not applicable to the Company.

(vi) We have broadly reviewed the books and records maintained by the company pursuant to the order of the Central Government 148 (1) of the Companies Act 2013 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have however not made a detailed examination of the records with a view to determining whether these records are accurate or complete.

(vii) (a) According to the information given to us and on the basis of the checks conducted by us we report that the company has not been regular in depositing undisputed statutory dues including Provident fund, Employees state insurance, Income Tax, Sales Tax, Service Tax, Duty of Customs, Duty of Excise, Value added tax, Cess and other statutory dues with appropriate authorities. The extend of arrears of Statutory dues as at the last day of the financial year concerned outstanding for a period of more than six months as at 31.3.2018, from the date they became payable are income tax of Rs. 71.71 lakhs and TDS of Rs.4.82 lakhs, Service Tax Rs 3.23 lakhs, Excise duty of Rs 46.39 lakhs, VAT of Rs 6.75 lakhs andCSTofRs.1.25lakhs.

(b) According to the information and explanations given to us, and based on the records of the company examined by us, the particulars of dues towards income tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax and cess as at 31st March 2018, which have not been deposited on account of any dispute are furnished as:

Sl. Name of the Nature of Dues Amount of tax Period to which the Forum where the Dispute No. statute disputed (Rs. In dispute relates. is pending. lakhs) 1 Income Tax Act Income Tax 22.18 AY 2014-15 CIT(Appeals), Kochi 2 Central Sales Tax Central Sales tax 15.48 A.Y 2007-‘08 Deputy Commissioner Act (Appeals), Kochi

(viii) In our opinion and according to the information and explanation given to us, the Company has not defaulted in repayment of loans or borrowings to financial institutions, banks and Government except for temporary delays occurred in the repayment details of which are given in Annexure C. There were no debenture holders at any time during the year.

(ix) The company has not made any initial public offer or further public offer or has availed any new term loans during the year.

(x) To the best of our knowledge and belief and according to the information and explanations given to us, no material fraud by the Company or any fraud on the company by its officers or employees during the year was noticed or reported, nor were we informed of such case by the management.

(xi) In our opinion, the managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of Section 19 read with Schedule V to the Companies Act 2013.

(xii)In our opinion, the Company is not a Nidhi Company. Therefore, the provisions of clause 3 (xii) of the Companies (Auditor’s Report) Order, 2016, are not applicable to the Company.

(xiii) In our opinion, all transactions with the related parties are in compliance with Section 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the financial statements etc. as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us, the Company has made preferential allotment of shares during the

57 year under review in accordance with the requirements of Section 42 of the Companies Act 2013 and the amount raised has been used for the purposes for which the funds were raised.

(xv) In our opinion and according to the information and explanations given to us, the Company has not entered into any non cash transactions with directors or persons connected with him for which provisions of section 192 are applicable. (xvi) In our opinion and according to the information and explanations given to us, the Company is not required to be registered under Section 45–IA of the Reserve Bank of India Act, 1934.

For KPR & Co Chartered Accountants FRN: 5326S Sd/- Deepa Praveen, ACA Kochi -11 Memb No: 232410 13.06.2018 Partner

ANNEXURE B TO THE INDEPENDENT AUDITOR’S REPORT OF EVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF SREE SAKTHI PAPER MILLS LIMITED

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (‘the Act’)

We have audited the internal financial controls over financial reporting of Sree Sakthi Paper Mills Ltd (the company) as of 31st March, 2018 in conjunction with our audit of the standalone financial statements of the company for the year ended on that date.

Management’s responsibility for Internal Financial Controls

The company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the company considering the essential components of internal control stated in the guidance note on audit of internal financial controls over financial reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and the timely preparation of reliable financial information as required under the Companies Act, 2013.

Auditor’s Responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the guidance note on audit of internal financial controls over financial reporting (the Guidance Note) and the standards on auditing, issued by ICAI and deemed to be prescribed under Section 143(10) of the Companies Act, 2013 to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and, both issued by the Institute of Chartered Accountants of India. Those standards and the Guidance Notes require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain Audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal controls based on the assessed risk. The procedures selected depend on the auditor’s judgment including the assessment of risks of material misstatement of the financial statements, whether due to fraud or error,

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the company’s internal financial control systems over financial reporting.

Meaning of internal financial controls over financial reporting

A company’s internal financial controls over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial controls over financial reporting includes those policies and procedures that (1) pertain to the maintenance of the records that, in reasonable detail, accurately and fairy reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that the transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that the receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding the prevention or timely deduction of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements .

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion of improper management override of controls, material misstatements due to error or fraud may occur and not be deducted. Also, projections of any evaluation of the internal financial controls over the financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

According to the information and explanations given to us and based on our audit, the following material weaknesses have been revealed as at March 31, 2018:

The internal control system established by the company for recording of financial transactions in time was not operating effectively due to which there was considerable delay in recording, reconciling and reporting the financial information on a timely basis. Further no internal audit was conducted during the year.

A ‘material weakness’ is a deficiency, or a combination of deficiencies, in internal financial control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company's annual or interim financial statements will not be prevented or detected on a timely basis.

In our opinion, except for the effects/possible effects of the material weaknesses described above on the achievement of the objectives of the control criteria, the Company has maintained, in all material respects, adequate internal financial controls over financial reporting and such internal financial controls over financial reporting were operating effectively as of March 31, 2018, based on the internal control over the financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of internal Financial Reporting issued by the Institute of Chartered Accountants of India.

We have considered the material weaknesses identified and reported above in determining the nature, timing, and extent of audit tests applied in our audit of the March 31, 2018 financial statements of the Company, and these material weaknesses does not affect our opinion on the financial statements of the Company.

For KPR & Co Chartered Accountants FRN: 5326S

Sd/- Deepa Praveen, ACA Kochi -11 Memb No: 232410 13.06.2018 Partner

ANNEXURE C TO THE INDEPENDENT AUDITOR’S REPORT OF EVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF SREE SAKTHI PAPER MILLS LIMITED

Details of delays occurred in repayment of loans referred in clause (viii) of Annexure A.

Loan Amount Due date of payment Date of payment No. of days of delay

11,044 15.04.2017 21.04.2017 6 11,044 15.05.2017 26.05.2017 11 11,044 15.06.2017 28.07.2017 43 11,044 15.07.2017 28.07.2017 13 11,044 15.08.2017 27.09.2017 43 11,044 15.09.2017 27.09.2017 12 Axis Bank Car Loan 11,044 15.10.2017 30.10.2017 15 11,044 15.11.2017 30.11.2017 15 11,044 15.12.2017 27.12.2017 12 11,044 15.01.2018 03.02.2018 19 11,044 15.02.2018 07.03.2018 20 11,044 15.03.2018 31.03.2018 16 13,58,000 11.04.2017 28.04.2017 17 13,75,000 11.05.2017 31.05.2017 20 13,58,000 11.06.2017 30.06.2017 19 Term Loan (SBT Panampilly Nagar) 34,95,000 11.07.2017 27.07.2017 16 12,90,000 11.08.2017 30.08.2017 19 4,66,18,010 11.09.2017 28.09.2017 17 5,00,000 28.05.2017 31.05.2017 3 Term Loan (Punjab 4,68,000 28.06.2017 30.06.2017 2 National Bank) 5,10,000 28.08.2017 30.08.2017 2

SREE SAKTHI PAPER MILLS LIMITED CIN : L93000KL1991PLC006207

Balance Sheet as at March 31, 2018 (₹ in Lakh) As at As at As at Particulars Note March 31, 2018 March 31, 2017 April 1, 2016 I. Assets 1 Non-current assets - Property,Plant & Equipment 4 770.11 965.80 5,502.65 - Capital work-in progress 5 - - 22.92 - Other Intagible Assets 6 - 0.16 0.16 - Financial Assets Investments 7A 16.39 16.45 57.70 Loans 7B 0.06 - 111.26 - Deferred tax assets (net) - Other non•current assets 8 13.59 40.69 40.25 2 Current Assets - Inventories 9 - 91.11 886.36 - Financial Assets Trade receivables 10A 179.15 334.38 1,664.34 Cash and cash equivalents 10B 24.77 16.75 353.34 Loans 10C - - 10.95 - Other current assets 11 322.32 339.84 587.42 - Assets held for sale 374.00 2,410.36 112.15 TOTAL 1,700.38 4,215.54 9,349.51

II. Equity & Liabilities 1 Equity - Equity share capital 12 1,729.62 1,643.62 1,643.62 - Other equity 13 (4,431.65) (3,908.86) (244.21) 2 Liabilities Non-Current Liabilities - Financial Liabilities Borrowings 16A 1,090.82 1,770.25 1,906.51 - Provisions 17 8.43 8.06 65.78 - Deferred tax liabilities (Net) 18 27.78 311.22 898.02 - Other non•current liabilities 19 1.43 1.43 1.43 3 Current Liabilities - Financial Liabilities Borrowings 16B 2,259.52 3,391.02 2,270.11 Trade payables 20 380.34 495.83 1,810.16 Other financial liabilities 21 7.18 183.75 164.87 - Other Current Liabilities 22 555.19 257.03 752.77 - Provisions 17 71.71 62.20 80.44 TOTAL 1,700.38 4,215.54 9,349.51 Summary of significant accounting policies 1,2,3 The accompanying notes form an integral part of the financial statements For KPR & Co For and on behalf of the Board Chartered Accountants FRN: 05326S Sd/- Sd/- Sd/- Deepa Praveen, ACA R.Ponnambalam S.Rajkumar, Company Secretary Vice Chairman & M. No.232410 Managing Director Partner Cochin -16 Sd/- Sd/- 13.06.2018 V.N.Sridharan N. Subramanian Chief Financial Officer Director 61

SREE SAKTHI PAPER MILLS LIMITED CIN : L93000KL1991PLC006207 Statement of profit and loss for the period ended March 31, 2018 (₹ in Lakh) For period ended For period ended Particulars Note March 31, 2018 March 31, 2017 I Revenue From Operations 23 162.79 2,893.72 II Other income 24 993.68 111.74 III Total Income 1,156.48 3,005.47 IV Expenses - Cost Of Material Consumed 25 - 1,726.81 - Purchase of stock-in-Trade 221.64 - Changes In Inventory 26 26.92 296.88 - Excise Duty 0.36 111.41 - Employee Benefit Expenses 27 78.94 356.46 - Finance costs 28 213.97 570.47 - Depreciation and ammortisation expenses 29 73.07 138.48 - Impairment loss Property,Plant & Equipment 88.00 2,080.76 - Other Expenses 30 130.53 1,773.40 Total expenses(IV) 611.79 7,276.32 V Profit/(Loss) before, exceptional items and tax (I-II) 544.69 (4,270.85) VI Exceptional Items [(expense) / income] 31 (1,584.50) - VII Profit/(Loss) before tax (1,039.82) (4,270.85) VIII Tax expense - Current income tax - - - Tax adjustments for previous year 32 11.05 - - Deffered Tax 32 (283.44) (586.80) (272.39) (586.80) IX Profit/(Loss) for the period from continuing operations(VIII+IX) (767.43) (3,684.05)

X Other comprehensive income - Items that will not be reclassified to Profit or Loss 33 0.63 19.40 - Income tax relating to items that will not be reclassified to Profit or Loss 33 - -

XI Total comprehensive income for the period(IX+X) (766.79) (3,664.65)

XII Earnings per Equity shares (of continuing operations) of Rs. 10/- each - Basic 15 (5.49) (23.24) - Diluted 15 (5.43) (23.24)

Summary of significant accounting policies 1,2,3 The accompanying notes form an integral part of the financial statements For KPR & Co For and on behalf of the Board Chartered Accountants FRN: 05326S Sd/- Sd/- Sd/- R.Ponnambalam S.Rajkumar, Deepa Praveen, ACA Company Secretary Vice Chairman & Managing Director M. No.232410 Partner Sd/- Sd/- Cochin -16 V.N.Sridharan N. Subramanian 13.06.2018 Chief Financial Officer Director

SREE SAKTHI PAPER MILLS LIMITED CIN: L93000KL1991PLC006207

Annexure to Notes on Financial Statements for the Year ended March 31, 2018 Note 1 – Reporting Entity Sree Sakthi Paper Mills Limited (the ‘Company’) is a company incorporated in India as a Limited Company on 3rd October, 1991, under the provisions of Companies Act, with the main objective of manufacturing of paper and paperboards.

Note 2 – Basis of Preparation

a. Statement of Compliance These financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015 notified under Section 133 of the Companies Act, 2013 (the ‘Act’) and the relevant provisions of the Act.

The Company’s financial statements up to and for the year ended 31 March 2017 were prepared in accordance with the Companies (Accounting Standards) Rules, 2006, notified under Section 133 of the Act and other relevant provisions of the Act.

As these are the Company’s first financial statements prepared in accordance with Indian Accounting Standards (Ind AS), Ind AS 101, First-time Adoption of Indian Accounting Standards has been applied. An explanation of how the transition to Ind AS has affected the previously reported financial position, financial performance and cash flows of the Company is provided in the Notes. The transition date is April 1, 2016.

b. Functional and presentation currency These financial statements are presented in Indian Rupees (‘INR’), which is also the Company’s functional currency. All amounts have been rounded-off to the nearest lakhs, unless otherwise indicated.

c. Basis of Measurement The financial statements have been prepared on the historical cost basis as a going concern on accrual basis except for the following items:

Item Measurement Basis

Certain financial assets and liabilities Fair value

Net defined benefit Liability Present value of defined benefit obligations

d. Basis Of accounting a) Income from Sale of own products is accounted net of Excise Duty, Cess, Sales Tax and Discounts.

e. Use of Estimate and Judgements In preparing these financial statements, management has made judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized prospectively.

The Pollution Control Board (PCB) required the company to make drastic changes / modification to the existing waste / effluent water disposal system installed by the company at its Kraft Paper Units I & II at Edayar. The company discussed the financial and commercial viability of the requirements proposed by the PCB and found it to be financially as well as commercially ‘non- viable’ considering the present productivity and profitability of the operation. Consequently, PCB issued closure notice [Notice No. (PCB / ESC / CO – 99 /07)] to both the Kraft Paper on 05.05.2016. Even though the company approached the Hon. High Court of Kerala for staying the order issued by the PCB, it restrained from interfering / staying the order issued by the PCB.

The company was required to close down both the units at Edayar w.e.f 27.06.2016 and the entire paper manufacturing operations were discontinued. As a result of it, the entire business were terminated for the remaining part of the year, except for selling and realizing the remaining inventory of raw materials and finished goods, stock, stores and spares and fixed assets.

As a part of revival plans proposed for the company, the Board of Directors, in its meeting held on 23.02.2017, discussed about venturing into the ‘logistics business’ by making use of the existing infrastructure consisting 9.75 acres of land and building at Edayar. After discussing and analysing the financial and commercial viability and feasibility of such a plan, the management decided to amend the Memorandum of Association (MoA) of the company to insert necessary object clause for the above proposal. The process of postal ballot has been already initiated and the results will be finalized before approval of the financial statements.

The company proposes to raise necessary funds for the new project by selling the lands at its Chalakudy Unit and the plant and machineries at Edayar Units. The company has already obtained ‘in-principle’ approval from the Government of Kerala for utilizing the existing allotted lands at Edayar for setting up a logistics business.

In view of the above developments and based on the analysis of the present market, the management of the company has come into a conclusion that the ‘going concern’ assumption of the company is still holding good and therefore, revaluation of assets and liabilities stated at historical cost is not warranted.

However, as a matter of prudence, the company has already provided for the possible ‘impairment loss’ accrued on its entire plant and machineries at Edayar Units. The current assets have been revalued at its realizable value thereby eliminating any probable loss on account of non-realisation.

Judgements Information about judgements made in applying accounting policies that have the most significant effects on the amounts recognized in the financial statements is included in the concerned notes.

Assumptions and estimation uncertainties Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment in the year ended 31 March 2018 is included in the concerned notes. f. Measurement of Fair Values A number of the company’s accounting policies and disclosures require measurement of fair values, for both financial and non-financial assets and liabilities.

The Company has an established control framework with respect to the measurement of fair values. The Company regularly reviews significant unobservable inputs and valuation adjustments. If third party information is required, the Company assesses the evidence obtained by the third parties to support the conclusions that these valuations meet the requirements of Ind AS, including the level in the fair value hierarchy in which the valuations should be classified.

Fair values are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

 Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.  Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).  Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs). When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

The Company recognizes transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

Note 3 – Accounting Policies

1. Foreign currency i. Foreign Currency Transactions

Transactions in foreign currencies are translated into the functional currency of the Company at the exchange rates at the date of the transaction.

Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rate at the reporting date.

2. Income tax Income tax comprises current and deferred tax. It is recognized in profit or loss except to the extent that it relates to an item recognized directly in equity or in other comprehensive income.

I. Current Tax

Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax reflects the best estimate of the tax amount expected to be paid or received after considering the uncertainty, if any, related to income taxes. It is measured using tax rates (and tax laws) enacted or substantively enacted by the reporting date.

Current tax assets and current tax liabilities are offset only if there is a legally enforceable right to set off the recognized amounts, and it is intended to realize the asset and settle the liability on a net basis or simultaneously.

II. Deferred Tax

Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the corresponding amounts used for taxation purposes. Deferred tax is also recognized in respect of carried forward tax losses and tax credits.

Deferred tax assets are recognized to the extent that it is probable that future taxable profits will be available against which they can be used. The existence of unused tax losses is strong evidence that future taxable profit may not be available. Therefore, in case of a history of recent losses, the Company recognizes a deferred tax asset only to the extent that it has sufficient taxable temporary differences or there is convincing other evidence that sufficient taxable profit will be available against which such deferred tax asset can be realized. Deferred tax assets – unrecognized or recognized, are reviewed at each reporting date and are recognized/ reduced to the extent that it is probable/ no longer probable respectively that the related tax benefit will be realized.

Deferred tax is measured at the tax rates that are expected to apply to the period when the asset is realized or the liability is settled, based on the laws that have been enacted or substantively enacted by the reporting date.

The measurement of deferred tax reflects the tax consequences that would follow from the manner in which the Group expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realized simultaneously.

3. Borrowing Cost Borrowing costs are interest and other costs (including exchange differences relating to foreign currency borrowings to the extent that they are regarded as an adjustment to interest costs) incurred in connection with the borrowing of fund.

Borrowing costs directly attributable to acquisition or construction of an asset which necessarily take a substantial period of time to get ready for their intended use are capitalized as part of the cost of that asset. Other borrowing costs are recognized as an expense in the period in which they are incurred.

4. Cash flow statement Cash flow statements are prepared under Indirect Method whereby profit or loss is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments, and items of income or expense associated with investing or financing cash flows. Cash and cash equivalents comprise of cash in hand, current and other accounts (including fixed deposits) held with banks.

5. Events occurring after the balance sheet date Assets and liabilities are adjusted for events occurring after the reporting period that provides additional evidence to assist the estimation of amounts relating to conditions existing at the end of the reporting period.

6. Property, Plant and equipment a. Recognition and Measurement

Land is capitalized on the basis of actual cost of acquisition, including establishment charges of land acquisition agency and legal expenses incurred for acquisition.

b. Capitalization of Assets and Charging of Depreciation

i) Fixed Assets are stated at cost. The cost of acquisition of Fixed Assets is inclusive of freight, duties, taxes, incidental expenses and the cost of installation/erection as applicable.

ii) Depreciation is in accordance with the provisions of Schedule II to the Companies Act, 2013. In the case of assets added /sold/discarded/transferred depreciation is charged on pro-rata basis.

iii) Impairment of Property, Plant and Equipment (PPE) The evaluation of applicability of indicators of impairment of assets requires assessment of external factors (significant decline in asset’s value, significant changes in the technological, market, economic or legal environment, market interest rates etc.) and internal factors (obsolescence or physical damage of an asset, poor economic performance of the asset etc.) which could result in significant change in recoverable amount of the PPE. iv) Determination of the estimated useful lives Useful lives of all PPE are based on the estimation done by the Management which is in line with the useful lives as prescribed in Part ‘C’ of Schedule II to the Act. In cases, where the useful lives are different from those prescribed in Schedule II and in case of intangible assets, they are estimated by management based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers’ warranties and maintenance support.

v) Fixed Assets identified for disposal are stated at Net Block Value or Net Realizable value whichever is lower and are shown separately in the financial statements as asset held for sale.

vi) Cost of Machinery Spares which can be used only in connection with an item of fixed asset and the use of which is expected to be irregular is allocated to the fixed assets and depreciated to the extent of 95% within a period not exceeding the useful life of the respective fixed asset. Individual spare parts having significant values are capitalized.

vii) Borrowing cost relating to the acquisition/construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare the qualifying assets for their intended use are complete. The qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

viii) Subsequent Expenditures are capitalized only if it is probable that the future economic benefits associated with the expenditure will flow to the Company.

7. Intangible Assets :

a. Recognition, Measurement and Amortisation:

Intangible Assets are amortised over the useful life of the respective assets. Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure is recognized in profit or loss as incurred.

b. Transition to IND AS

On transition to Ind AS, the Company has elected to continue with the carrying value of all of its intangible assets recognized as at 1 April 2016, measured as per the previous GAAP, and use that carrying value as the deemed cost of such intangible assets.

8. Valuation of investments: i. Financial instruments

a. Recognition and initial measurement All financial assets and financial liabilities are initially recognized when the Company becomes a party to the contractual provisions of the instrument. A financial asset or financial liability is initially measured at fair value plus, for an item not at fair value through profit and loss (FVTPL), transaction costs that are directly attributable to its acquisition or issue.

b. Classification and subsequent measurement Financial assets On initial recognition, a financial asset is classified as measured at • amortized cost; • Fair Value through Other Comprehensive Income (FVOCI) – equity investment; or • Fair Value Through Profit and Loss (FVTPL)

Financial assets are not reclassified subsequent to their initial recognition, except if and in the period the Company changes its business model for managing financial assets.

A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as at FVTPL:

• the asset is held within a business model whose objective is to hold assets to collect contractual cash flows; and • the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

On initial recognition of an equity investment that is not held for trading, the Company may irrevocably elect to present subsequent changes in the investment’s fair value in OCI. (designated as FVOCI – equity investment). This election is made on an investment-by-investment basis.

All financial assets not classified as measured at amortized cost or FVOCI as described above are measured at FVTPL. This includes all derivative financial assets. On initial recognition, the Company may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortized cost or at FVOCI or at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.

Financial assets that are held for trading or are managed and whose performance is evaluated on a fair value basis are measured at FVTPL.

Financial assets at FVTPL These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognized in profit or loss.

Financial assets at amortized These assets are subsequently measured at amortized cost using the effective cost interest method. The amortized cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are recognized in profit or loss. Any gain or loss on de-recognition is recognized in profit or loss.

Equity investments at FVOCI These assets are subsequently measured at fair value. Dividends are recognized as income in profit or loss. Other net gains and losses are recognized in OCI and are not reclassified to profit or loss.

c. De-recognition Financial assets The Company de-recognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the company neither transfers nor retains substantially all of the risks and rewards of ownership and does not retain control of the financial asset. If the company enters into transactions whereby it transfers assets recognized on its balance sheet, but retains either all or substantially all of the risks and rewards of the transferred assets, the transferred assets are not derecognized.

Financial liabilities The Company de-recognizes a financial liability when its contractual obligations are discharged or cancelled, or expire. The Company also de-recognizes a financial liability when its terms are modified and the cash flows under the modified terms are substantially different. In this case, a new financial liability based on the modified terms is recognized at fair value. The difference between the carrying amount of the financial liability extinguished and the new financial liability with modified terms is recognized in profit or loss. 9. Valuation of Current Assets: a) Stores, Spares, Materials under Inspection, Materials in Transit, Materials Issued on Loan and Raw Materials are accounted for at lower of the cost on Weighted Average Method or Net Realisable Value.

b) Finished Goods are accounted for at lower of the cost on FIFO Method or Net Realisable Value.

c) Semi-finished Goods (Work-in-Process) are valued at variable cost on Weighted Average Method.

10. Non-current assets held for sale

Non-current assets comprising assets and liabilities are classified as held for sale if it is highly probable that they will be recovered primarily through sale rather than through continuing use.

Such assets are generally measured at the lower of their carrying amount and fair value less costs to sell. Losses on initial classification as held for sale and subsequent gains and losses on re-measurement are recognized in profit or loss.

Once classified as held-for-sale, intangible assets, property, plant and equipment and investment properties are no longer amortized or depreciated.

11. Retirement/Terminal Benefits/Bonus/Leave encashment a) Company’s liability towards employee benefits such as gratuity and leave encashment are provided for on the basis of actuarial valuation. b) Expenditure incurred on short term employee benefits including bonus, production incentive, medical benefits and other perquisites etc. are charged to the Profit and Loss Account at un-discounted amounts in the year in which services are rendered.

c) Expenditure on employee benefits in the nature of contributions to Provident Fund, Employees State Insurance, Labour Welfare Fund etc. are charged to the Profit and Loss Account as and when contributions to the respective funds are due. d) Liability for bonus is provided for as per the provisions of the Payment of Bonus Act 1965. e) Actuarial gains or losses, as the case may be, in respect of valuation of employee benefits are charged to the Profit and Loss Account.

f) Re-measurements of the net defined benefit liability, which comprise actuarial gains and losses are recognized in OCI. 12. Provisions, Contingent Liabilities and Contingent Assets a) Provisions (other than trade payables and accruals) as mentioned in the Ind As 37 issued by the Institute of Chartered Accountants of India are accounted for and disclosed to the extent practicable in the manner laid down in the said Accounting Standard. b) Contingent Liabilities disclosed in the Notes forming part of the Accounts comply with Ind As 37 to the extent practicable. c) Company has not recognized any Contingent Asset.

As negotiations are going on with the debtors and creditors of the company for settlement of dues, we have not obtained the confirmation of balances as at the year end. Any additional liability required based on the reconciliations / settlement made with the debtors and creditors, will be provided in the due course.

b) Compliance on transfer of Unpaid Dividend and Unclaimed Shares to IEPF Account Sec 124(5) of the Companies Act, 2013 read with Rule 6 of Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rule, 2017, requires every company to transfer any unpaid dividend along with the corresponding equity shares outstanding for more than the period prescribed under Act to the Investor Education and Protection Fund (IEPF) Account.

The Ministry of Corporate Affairs (MCA) vide General Circular No. 12/2017 dated 16.10.2017 had notified the due date to transfer the equity shares where the specified period has completed.

The company has not transferred such equity shares .The Company is taking necessary steps to identify such equity shares and comply with the provisions of the Act.

SREE SAKTHI PAPER MILLS LIMITED CIN : L93000KL1991PLC006207

Statement of changes in equity for the period ended March 31, 2018 A. Equity share capital (₹ in Lakh) Changes in equity Changes in equity Opening balance Closing balance Closing balance Particulars share capital during share capital during as at 1 Apr 2016 as at 31 Mar 2017 as at 31 Mar 2018 the year the year Equity shares of Rs.10 each 1,643.62 - 1,643.62 86.00 1,729.62 Total 1,643.62 - 1,643.62 86.00 1,729.62

B. Other Equity (₹ in Lakh) Changes in Tax on other Opening balance Restated balance Total comprehensive Transfer to retained Closing balance Particulars accounting policy/ Dividends comprehensive as at 1 Apr 2016 as at 1 Apr 2016 income for the year earnings as at 31 Mar 2017 prior period errors income (i) Capital Reserve 36.68 - 36.68 - - - - 36.68 (ii) General Reserve 533.00 - 533.00 - - - - 533.00 (iii) Retained earnings (2,422.25) (28.12) (2,450.37) (3,684.05) - - (6,134.42) (iv) Securities premium 1,667.24 - 1,667.24 - - - - 1,667.24 (v) Money received against share warrants ------(vi) Other comperhensive income - Actuarial gain/(loss) on defined benefit obligation - - - (9.36) - - - (9.36) - Equity instrunment through other comperhensive income - (30.76) (30.76) 28.76 - - - (2.00) Total reserves (185.33) (58.88) (244.21) (3,664.65) - - - (3,908.86)

(₹ in Lakh) Changes in Tax on other Opening balance Restated balance Total comprehensive Transfer to retained Closing balance Particulars accounting policy/ Dividends comprehensive as at 1 Apr 2017 as at 1 Apr 2017 income for the year earnings as at 31 Mar 2018 prior period errors income (i) Capital Reserve 36.68 - 36.68 - - - - 36.68 (ii) General Reserve 533.00 - 533.00 - - - - 533.00 (iii) Retained earnings (6,134.42) - (6,134.42) (767.43) - - - (6,901.85) (iv) Securities premium 1,667.24 - 1,667.24 8.60 - - - 1,675.84 (v) Money received against share warrants - - - 235.40 - - - 235.40 (vi) Other comperhensive income - - Actuarial gain/(loss) on defined benefit obligation (9.36) - (9.36) 0.69 - - - (8.67) - Equity instrunment through other comperhensive income (2.00) - (2.00) (0.06) - - - (2.06) Total reserves (3,908.86) - (3,908.86) (522.80) - - - (4,431.66)

For KPR & Co For and on behalf of the Board Chartered Accountants FRN: 05326S Sd/- Sd/- Sd/- R.Ponnambalam S.Rajkumar, Deepa Praveen, ACA Company Secretary Vice Chairman & Managing Director M. No.232410 Partner Cochin -16 Sd/- Sd/- 13.06.2018 V.N.Sridharan N. Subramanian Chief Financial Officer Director

SREE SAKTHI PAPER MILLS LIMITED CIN : L93000KL1991PLC006207

Notes forming part of the Financial Statements

NOTE 4 Property,Plant & Equipment Furniture and Particulars Land Building Plant and machinery Vehicle Office equipments Total fixtures

Year ended 31 March, 2017

Gross Carrying Amount Deemed Cost as at 1 April 2016 233.27 744.12 18.20 4,469.08 26.79 11.19 5,502.65 Exchange differences ------Additions ------Disposals - - - 4,382.48 15.69 0.22 4,398.39

Closing Gross Carrying Amount 233.27 744.12 18.20 86.60 11.10 10.97 1,104.26

Accumulated Depreciation Depreciation charge during the year - 59.73 4.29 62.80 6.71 4.94 138.48 Impairment loss - - - 2,080.76 - - 2,080.76 Exchange differences ------Disposals - - - 2,080.76 - - 2,080.76

Closing Accumulated Depreciation - 59.73 4.29 62.80 6.71 4.94 138.48

Net Carrying Amount 233.27 684.39 13.91 23.80 4.39 6.03 965.81

Year ended 31 March, 2018

Gross Carrying Amount Opening Gross carrying amont 233.27 744.12 18.20 86.60 11.10 10.97 1,104.26 Exchange differences ------Additions ------Disposals 34.75 34.75

Closing Gross Carrying Amount 198.52 744.12 18.20 86.60 11.10 10.97 1,069.51

Accumulated Depreciation and Impairment Opening accumulated depreciation - 59.73 4.29 62.80 6.71 4.94 138.48 Depreciation charge during the year - 64.67 3.95 1.85 0.31 2.29 73.07 Impairment loss - 83.59 0.45 - 3.43 0.37 87.84 Exchange differences ------Disposals ------

Closing Accumulated Depreciation - 207.98 8.69 64.65 10.45 7.61 299.39

Net Carrying Amount 198.52 536.14 9.51 21.95 0.65 3.36 770.11

(i) On transition to Ind AS, the Company has elected to continue with the carrying value of all of its property, plant and equipment recognised as at 1 April 2016 measured as per the previous GAAP and use that carrying value as the deemed cost of the property, plant and equipment. (ii) Borrowing costs capitalized during this year – Rs Nil Lakhs (2016‐17 – Nil Lakhs ) (iii) The Company has paid entire value for 1.76 Acres of industrial land and has taken the posseession of the same at Edayar. Company has started using the land entirely by the beginning of 2013. Final clearance is awaited for effecting legal transfer of ownership. In view of the above and in accordance with subsatance and economic reality, this amount has been accounted as Land under Fixed Assets.

SREE SAKTHI PAPER MILLS LIMITED CIN : L93000KL1991PLC006207

Notes forming part of the Financial Statements NOTE 5- CWIP (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Expenditure During Construction Period - - - - Details of Expenditure During Construction Period Opening Balance - 22.92 Add: Expenditure during the year: - - - Employees' Remuneration & Benefits - - - Project Management fee - - - Interest During Construction - - Total - 22.92 Total Expenditure - 22.92 Less: Transfer to Property, Plant & Equipment 22.92 Closing balance - -

NOTE 6- Other Intangible Assets (₹ in Lakh) Computer Particulars software Total Year ended 31 March, 2017 Gross Carrying Amount Deemed Cost as at 1 April 2016 0.16 0.16 Additions - - Closing Gross Carrying Amount 0.16 0.16

Accumulated Amortisation Amortisation charge during the year - - Closing Accumulated Depreciation - -

Net Carrying Amount 0.16 0.16

Year ended 31 March, 2018 Gross Carrying Amount Opening Gross carrying amont 0.16 0.16 Additions - - Closing Gross Carrying Amount 0.16 0.16

Accumulated Depreciation Opening accumulated depreciation - - Amortisation charge during the year - - Impairment charge 0.16 0.16 Closing Accumulated Depreciation 0.16 0.16

Net Carrying Amount - - Transition to Ind AS On transition to Ind AS, the Company has elected to continue with the carrying value of all of its Intangible assets recognised as at 1 April 2016 measured as per the previous GAAP and use that carrying value as the deemed cost of the Other Intangible Assets. 72

SREE SAKTHI PAPER MILLS LIMITED CIN : L93000KL1991PLC006207 Notes forming part of the Financial Statements NOTE 7 : Non Current Financial Assets NOTE 7A -Investment (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Investment carried at fair value through other comprehensive income Quoted - Equity Instruments 1.50 1.56 1.51 - Mutual Funds - - 41.37 Unquoted - Equity Instruments 0.79 0.79 0.72 A 2.29 2.35 43.60 Investment carried at amortized cost - Investments in Subsidiaries 14.10 14.10 14.10 B 14.10 14.10 14.10

Total investment C = (A+B) 16.39 16.45 57.70 There are no financial investments measured at fair value through profit and loss * Details of investment (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Quoted Non-Trade Investments: Investment in Equity Instruments - 2,080 Equity shares of I.D.B.I.Ltd of Rs 10 each fully paid up 1.50 1.56 1.51 In Mutual Funds - 1,30,597 units of ICICI Prudential Infrastructure fund - - 15.53 - 1,25,646 units of L&T Oppurtunities Fund - - 19.22 - 23,286 units of UTI Master Growth Unit Scheme - - 6.62 1.50 1.56 42.88 Unquoted Non-Trade Investments: Investment in Equity Instruments Investments in Subsidiaries - Jala Shaayi Alamparathodu Hydro Power Ltd 4.70 4.70 4.70 (47,001 Equity Shares Of Rs 10 Each Fully Paid Up) - Sree Kailas Palchuram Hydro Power Ltd 4.70 4.70 4.70 (47,001 Equity Shares Of Rs 10 Each Fully Paid Up) - Sree Adi Sakthi Mukkuttathode Hydro Power Ltd 4.70 4.70 4.70 (47,001 Equity Shares Of Rs 10 Each Fully Paid Up) Investment In Others - Kerala Enviro Infrastructure Ltd 0.79 0.79 0.72 (10,000 Equity Shares Of Rs 10 Each Fully Paid Up) - Cochin Waste 2 Energy P Ltd - - - (30,000 Equity Shares Of Rs 10 Each Fully Paid Up) - - - 14.89 14.89 14.82

NOTE 7B -Loans (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Unsecured considered good - Security Deposits - - 111.26 Unsecured Considered Doubtful - Security Deposits 24.60 24.54 8.16 24.60 24.54 119.42 - Provision for doubtful deposits (24.54) (24.54) (8.16) 0.06 - 111.26 NOTE 8 : Other Non Current Assets (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Unsecured,considered good - Advance to related parties 13.59 40.69 35.94 - Capital Advances - - 4.31 Unsecured,considered doubtful - Capital Advances 83.12 83.12 83.12 less : provision for doubtful advance (83.12) (83.12) (83.12) 13.59 40.69 40.25 * Details of Advance to related parties As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Jalashaayi Alamparathode Hydro Power Ltd. - 9.94 8.62 Sree Kailas Palchuram Hydro Power Ltd 12.97 20.26 18.22 Sree Adisakthi Mukkuttathode Hydro Power Ltd 0.62 10.49 9.10 13.59 40.69 35.94

NOTE 9 : Inventories (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 At lower of cost and net realisable value - Raw Material - - 175.28 - Packing material - - - work-in-progress - - 15.16 - Finished goods - 26.92 308.64 - Stores, spares & fuels - 63.79 386.25 - Renewable energy certificate - 0.40 1.03 - 91.11 886.36

* Inventory includes : (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 In transit - Raw materials - - 47.73 - - 47.73

Mode of valuation: (i) Inventory of raw materials and consumables are valued at cost or net realizable value, whichever is lower, under FIFO Method.

Finished Goods are valued at cost or net realizable value whichever is lower. Cost for the purposes of valuation of finished goods includes cost of material, labour and other direct expenses.

Stock-in-process is valued at raw material cost plus proportionate direct cost, wherever applicable. (ii) Inventories in the nature of Renewable Energy Certificates (REC) are accounted for in accordance with Guidance Note on Accounting for Self Generated Emission Reductions issued by ICAI. Accordingly, RECs are recognised on approval of certificate from respective authority, which are valued at lower of cost or net realisable value. Cost comprises of cost incurred for certification of REC and NRV is the floor price fixed by Central Electricity Regulatory Commission.

NOTE 10: Current Financial Assets

NOTE 10A :Trade Receivables (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Secured - More than six months from the date they became due - - - Unsecured - Considered Good (i) Exceeding Six Months From They become Due 179.15 148.62 516.44 (ii) Others - 185.76 1,147.90 - Considered Doubtful 721.04 783.00 235.41 Provision for doubtful debts (721.04) (783.00) (235.41) 179.15 334.38 1,664.34

A. Details of debts due by related party (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Directors - - - Officers - - - Firms in which any director is a partner - Carto Packs - 30.53 75.09 - Aditya Paper - 2.92 - Private Companies in which any Director is a director or member - - - - 33.45 75.09

NOTE 10B :Cash and cash equivalents (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Balance with Banks - In Current Accounts 22.32 3.81 12.92 - In Deposit Accounts 1.05 12.85 338.46 Cash in Hand 1.40 0.08 1.96 24.77 16.75 353.34

* Details of deposit account (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Bank of India - - 79.48 Federal Bank Ltd 1.05 0.97 154.89 Industrial Development Bank of India - 11.89 104.09 1.05 12.85 338.46

NOTE 10C : Short term Loans (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Security deposit - Unsecured considered good 27.60 27.60 29.70 provision for doubtful deposits (27.60) (27.60) (18.75) - - 10.95

NOTE 11 : Other Current Assets (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Advances income tax 20.64 311.40 326.07 Cenvat Credit - 4.19 99.78 Earmarked balance with bank 6.85 10.90 10.95 Interest accrued on deposits - 0.02 8.68 other receivable 294.83 13.33 141.94 322.32 339.84 587.42

NOTE 12 :Equity share capital

A. Authorised (₹ and Nos in Lakh) Equity shares Preference shares Particulars Shares Amount Shares Amount As at April 2016 250.00 2,500.00 250.00 2,500.00 - Increase during the year - - - - As at 31 March 2017 250.00 2,500.00 250.00 2,500.00 - Increase during the year - - - - As at 31 March 2018 250.00 2,500.00 250.00 2,500.00

B. Issued, Subscribed & fully Paid Up As at March 31, 2018 As at March 31, 2017 As at March 31, 2016 Particulars No. of shares Amount No. of shares Amount No. of shares Amount At the beginning of the period 164.36 1,643.62 164.36 1,643.62 164.36 1,643.62 Issued during the period 8.60 86.00 - - - - Outstanding at the end of the 172.96 1,729.62 164.36 1,643.62 164.36 1,643.62

Rights, Preferences and Restrictions attached to equity Shares 1 The Company has only one class of shares referred to as Equity Shares having a par value of Rs.10/- per share. Each holder of Equity Shares is entitled to one vote per share. 2 The company declares and pays dividend in Indian Rupees. The dividend when proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. 3 In the event of liquidation of the company the holders of equity shares shall be entitled to receive any of the remaining assets of the company after distribution of all preferential amounts. However, no such preferential amounts exists currently. The distribution will be in proportion to the number of equity shares held by the shareholders. 4 The Company has not issued any securities convertible into Equity or Preference Shares. 5 No shares have been forfeited till date. 6 Out of the total share capital issued and called up, no calls are outstanding as unpaid. 7 During the last 5 years ,the company has not issued any shares pursuant to any contract without payment being received in , cash as bonus shares or has not brought back any shares. 8 The following shareholders hold more than 5% of the shares: (Nos in Lakh) Name As at 31-03-2018 As at 31-03-2017 As at 01-04-2016 No of Shares % of holding No of Shares % of holding No of Shares % of holding S.Rajkumar 55.40 32.03% 46.80 28.47% 46.80 28.47% A.Padmanabhan 12.95 7.49% 12.95 7.88% 13.18 8.02% Gopinathan CK 10.06 5.82% 10.06 6.12% 10.00 6.08% S.Giridhar 7.13 4.12% 7.13 4.34% 8.50 5.16%

NOTE 14 : Analysis of items of other comprehensive income(OCI),net of tax Defined benefit Eqity instrunment Particulars plans through OCI As at 1st april 2016 - (30.76) Remeasurements (9.36) - Remeasurements utilized during the year 28.76 As at 31st march 2017 (9.36) (2.00) Remeasurements 0.69 (0.06) Remeasurements utilized during the year - - As at 31st march 2018 (8.67) (2.06)

NOTE 15 : Earning per share Basic and diluted earning per share The calculations of profit attributable to equity shareholders and weighted average number of equity shares outstanding for purposes of basic earnings per share calculation are as follows:

i. Profit (loss) attributable to equity shareholders (basic and diluted) (₹ in Lakh) For period ended For period ended Particulars March 31, 2018 March 31, 2017 Profit (loss) for the year (767.43) (3,684.05) less: Cumulative preference dividend not provided 135.40 135.40 Profit (loss) for the year, attributable to the equity holders (902.83) (3,819.45)

ii. Weighted average number of equity shares (Basic EPS) For period ended For period ended Particulars March 31, 2018 March 31, 2017 Opening Balance 164.36 164.36 Effect of fresh issue of shares 0.07 - Weighted average number of equity shares for the year 164.43 164.36 Earning Per Share (EPS) - (Rs.) (5.49) (23.24)

iii. Weighted average number of equity shares (Diluted EPS) For period ended For period ended Particulars March 31, 2018 March 31, 2017 Opening Balance 164.36 164.36 Effect of fresh issue of shares 0.07 - Effect of fresh issue of shares warrants 1.93 - Weighted average number of equity shares for the year 166.37 164.36 Earning Per Share (EPS) - (Rs.) (5.43) (23.24)

NOTE 16 : Financial Liabilities NOTE 16A: Non Current Borrowings (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Non-current Borrowings Secured Term loans - From Banks - 703.86 856.91 Preference share 1,090.82 1,066.39 1,049.60 1,090.82 1,770.25 1,906.51 NOTE 16B: Current Borrowings As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Secured Loans from Banks Cash Credit 711.68 1,326.48 1,521.55 Short Term loan Sub-Total 711.68 1,326.48 1,521.55 Unsecured Loans Buyers credit facility - 13.16 723.26 Intercorporate Loan 712.00 - - Related parties 835.84 2,051.38 25.30 Sub-Total 1,547.84 2,064.54 748.56 Total 2,259.52 3,391.02 2,270.11 The Secured loan represents cash credit facility from banks creating 1st charge on entire current assets and second charge on entire fixed assets of the company. 77

* Secured Term Loans (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016

(i) Federal Bank Ltd - 145.50 164.47 (ii) SBT panampilly nagar (TLI) - 512.72 592.32 (iii) Punjab National bank - 216.70 247.53 (iv) Vehicle loanAxis Bank (Loan no: 3) 0.33 - 2.65 (v) Vehicle loanAxis Bank (Loan no: 4) - 1.74 3.86 Total 0.33 876.66 1,010.83 Less:Current maturities of long term debts 0.33 172.80 153.92 - 703.86 856.91

(i) Vehicle loan from Axis bank is repayable in 60 monthly instalments of Rs.0.16 lakhs each.

* Preference share (i) The Company has only one class of Preference Shares (non-convertible cumulative redeemable ) having a face value of Rs.10/- per share. (ii) Preference shares carries a dividend at the rate of 11.25% (iii) The company shall redeem the preference share at par in 4 annual installment of Rs. 2.5 crore each. (iv) Details of shares held by each shareholder holding more than 5% shares: (Nos in Lakh) Name As at 31-03-2018 As at 31-03-2017 As at 01-04-2016 No of Shares % of holding No of Shares % of holding No of Shares % of holding Kerala State Industrial 60.00 60.00% 100.00 100.00% 100.00 100.00% Development S.Rajkumar 40.00 40.00% - 0.00% - 0.00%

* Current Borrowings - Secured (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Cash Credit - Industrial Development Bank of India Ltd 209.20 383.90 291.37 - Federal Bank Ltd 502.48 704.40 925.32 - Bank of India - 238.18 304.86 711.68 1,326.48 1,521.55

Discription Repayment term Limit sanctioned - Industrial Development Bank of India Ltd On demand 30,000,000 - Federal Bank Ltd On demand 92,500,000 - Bank of India On demand 30,000,000

* Current Borrowings - Unsecured (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Buyer's Credit - IDBI - Dubai - 13.16 357.50 - Bank of India - Tokyo - - 109.29 - Federal Bank - - 256.47 - 13.16 723.26 Related parties - Loan from Directors 656.94 1,222.53 25.30 - Loan from Group Companies 178.90 116.85 - - Inter-corporate Loan - 712.00 - 835.84 2,051.38 25.30

NOTE 17 :Provisions (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Non-Current Provisions Provision for Employee benefits - Gratuity 8.43 8.06 65.78 8.43 8.06 65.78 Current Provisions Provision for Employee Benefits - Leave encashment - 1.54 4.78 Income tax Provision 71.71 60.66 75.66 71.71 62.20 80.44

1 The Provisions for Gratuity and Leave Encashment are made based on the actuarial valuation on 31.03.2018. 2 The laibility for Gratuity has been calculated on the basis of current ceiling of ₹10 lakh. The proposed enhancement of ceiling to ₹ 20 lakh has not been considered as the related amendment in The Payment of Gratutiy Act is yet to be notified. 3 Acturial valuation of gratuity is presently based on the retirement age of 55 years. The Union has filed a case before Kerala High Court for increasing the retirement age to 58. Impact on provision for gratuity, if the case is decided against the Company,has not been ascertained. 4 Since the valuation is done by a professional actuary, the assumprions taken is considered reliable and hence sensitivity analysis is not done. Reconciliation of the net defined benefit liability TYPE OF PLAN Particulars Gratuity Leave plan As at 1 April 2016 63.75 6.81 Expected return on plan assets - - Interest Cost 4.48 0.51 Current service cost 0.49 1.05 Actuarial loss/(gain) on obligation 16.19 (6.83) Employer contribution to plan assets - - Net effect of benefit payments (76.85) - As at 31 March 2017 8.06 1.54 Expected return on plan assets - - Interest Cost 0.61 - Current service cost 0.46 - Actuarial loss/(gain) on obligation (0.00) - Employer contribution to plan assets - - Net effect of benefit payments - - As at 31 March 2018 9.13 -

Expense recognised in profit or loss TYPE OF PLAN Particulars Gratuity Leave plan For the period ended 31 March 2017 Expected return on plan assets - - Interest Cost 4.48 0.51 Current service cost 0.49 1.04 Actuarial loss/(gain) on obligation - Claims received w.r.t previous years - - Total amount recognised in profit or loss 4.97 1.55 For the period ended 31 March 2018 Expected return on plan assets - - Interest Cost 0.61 - Current service cost 0.46 - Actuarial loss/(gain) on obligation - - Employer contribution to plan assets recognised in P/L - - Total amount recognised in profit or loss 1.07 -

Remeasurements recognized in other comprehensive income

TYPE OF PLAN Particulars Gratuity Leave plan 31-03-18 31-03-17 31-03-18 31-03-17 Actuarial loss/(gain) on obligation (0.69) 16.19 - (6.83) Balance as at the end of the year (0.00) 16.19 - (6.83)

Significant Estimates- The Significant actuarial valuation applicable for the plans are as below: Particulars 31-03-18 31-03-17

Indian Assured Lives Mortality (2006-08) Indian Assured Lives Mortality (1994-96) Mortality table Ultimate Discount Rate 7.54% 7.00% Salary escalation rate 5.00% 5.00%p.a Expected rate of return on plan assets Not Applicable Not Applicable

NOTE 18 :Deferred tax liabilities (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Deferred Tax Liabilities - Property,Plant & Equipment 152.65 436.56 1,112.17 Deferred Tax Asset - Provision for unrecognised expense 32.43 32.43 119.60 - Provision for Production Incentive 19.70 20.17 21.80 - Provision for Doubtful Debts/Claims 72.74 72.74 72.74 Net Deferred Tax Liabilities 27.78 311.22 898.02

* Movement in deferred tax liabilities Provision for Provision for Provision for Particulars Property,Plant & unrecognised Production Doubtful Equipment expense Incentive Debts/Claims At 1 April 2016 1,112.17 119.60 21.80 72.74 Charged/(credited) -to profit or loss (675.60) (87.17) (1.63) - -to other comprehensive income - - - - At 31 March 2017 436.56 32.43 20.17 72.74 Charged/(credited) -to profit or loss (283.90) - (0.47) - -to other comprehensive income At 31 March 2018 152.65 32.43 19.70 72.74

NOTE 19 : Other non•current liabilities (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Security deposits 1.43 1.43 1.43 1.43 1.43 1.43

Disclosure under Micro, Small and Medium Enterprises Development Act: (i) The above balances are subject to confirmation from the respective parties (ii) Amount due to Micro, Small and Medium enterprises included under Trade payables is ₹ 0.65 (Previous year ₹ 0.65 lakh). This amount is identified by the Management and relied upon by the Auditors. (iii) Interest of Rs 0.20 lakhs (Previous year ₹ 0.18 lakh) had become payable under Section 16 of the Micro, Small and Medium Enterprises Development Act, 2006 .

NOTE 21 : Other current financial liabilities (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Current maturities of long term debts - Federal Bank Ltd - 30.00 18.00 - SBT panampilly nagar - 106.06 90.96 - Punjab National Bank - 35.00 41.70 - Vehicle loan Axis Bank - - 1.33 - Vehicle loan Axis Bank 0.33000 1.74 1.93 Dividend payable 6.85057 10.95 10.95 7.18057 183.75 164.87

NOTE 23 :Sale of Products (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 (i) Sale of products: - own products 26.89 2,289.26 add: excise duty 0.36 111.41 (ii) Other operating income - Traded products - 374.85 - Scrap product 35.88 39.34 - Process waste income 1.13 - Sales of renewable energy certificate 99.67 77.73 162.79 2,893.72

NOTE 24 : Other Income (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 (i) Interest income: - On deposits with banks [Tax Deducted at Source Rs 0.12 Lakhs (Previous year Rs1.82 Lakhs)] 1.67 18.58 - On Advances 1.51 3.11 (ii) Dividend income from Long-term investment - (iii) Sale Of Scrapped Fixed Assets 965.00 - (iv) Other non-operating income 25.50 90.05 993.68 111.74

Details of Other non-operating income (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Emd Forfeited Account - 25.00 Insurance Collected (Income) 4.95 0.66 Loss/Gain On Sale Of Fixed Asset - 8.69 Commission Received - 2.80 Miscellaneous income 20.55 52.91 25.50 90.05

NOTE 25 : Cost of Materials Consumed (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Raw materials - 1,692.63 packing materials - 34.18 - 1,726.81

NOTE 25A : Item Wise Breakup Of Raw Material Consumed (₹ in Lakh) As at 31-3-2018 As at 31-3-2017 Particulars ₹ ( In lakhs) % ₹ ( In lakhs) % (i) Value of Raw materials consumed - Indigenous - - 434.82 25.69% - Imported - - 1,134.89 67.05% - - 1,569.71 92.74% (ii) Value of Chemicals consumed - Indigenous - - 122.92 7.26% - Imported - - - 0.00% - - 122.92 7.26%

- - 1,692.63 100%

NOTE 26 : Changes in Inventory (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Stock as on 1st April Finished Goods 26.92 308.64 Work in Process - 15.16 Total opening balance 26.92 323.80

Stock as on 31st March Finished Goods - 26.92 Work in Process - - Total Closing Balance - 26.92

Changes in Inventory 26.92 296.88

NOTE 27 : Employee Benfit Expenses (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Salaries, Wages & Allowances 59.03 206.29 Remuneration to Managerial persons - 25.24 Gratuity 1.07 6.07 Bonus - 4.50 Leave Encashment - 1.56 Staff Welfare Expenses 8.02 14.08 Employer's Contribution to PF 1.79 6.52 Employer's Contribution to ESI 0.90 4.34 Coolie charges - contract - 57.15 Allowances and expenses to contract workers - 22.8 Others 8.13 7.91 78.94 356.46 NOTE 28 : Finance Cost (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Interest Cost on Financial liabilities carried at amortised cost - Interest expense 189.54 451.31 - Other borrowing cost - 75.55 - Exchange fluctuation - 26.82 - Loss on fair valuation of preference shares 24.43 16.79 213.97 570.47 NOTE 29 : Depreciation and ammortisation expenses (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Depreciation Property,Plant & Equipment 82 73.07 138.48 Ammortisation of intangible assets - - 73.07 138.48 NOTE 30 : Other Expenses (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Payment to auditor 2.09 2.87 Stores and Spares Consumed - 271.40 Power and fuel 6.09 426.29 Rent 4.86 39.43 Repairs and maintenance -Plant & Machinery - 34.85 -Buildings - 18.22 -Others 2.32 Insurance charges 5.43 16.80 Rates and Taxes 35.69 12.51 Discount 9.65 27.85 Stock Written Off - - Provision for doubtful debt - 531.17 Provision for advance - 82.95 Freight outwards 0.39 45.15 Miscellaneous expenses 64.01 263.91 130.53 1,773.40 NOTE 30A : Payment to auditor As at As at Particulars March 31, 2018 March 31, 2017 Statutory Audit Fee 0.75 0.50 Tax Audit Fee 0.25 0.25 Auditors Out of pocket Expense 0.30 0.29 Fee for other services 0.75 0.30 Audit fee for certfication 0.04 1.53 2.09 2.87 NOTE 30B : Stores and Spares Consumed As at 31-3-2018 As at 31-3-2017 Particulars ₹ ( In lakhs) % ₹ ( In lakhs) % Indigenous - 271.40 100% Imported - - 0.00% - 0.00% 271.40 100.00%

NOTE 31 : Exceptional Items [expense / (income)] (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Retrenchment Compensation 98.82 Profit on sale of land (915.25) Loss on sale of asset held for sale 2,100.55 Mat Credit Expense 300.38 1,584.50 - NOTE 32 : Tax Expense (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Tax adjustments for previous year 11.05 - Deferred Tax (283.44) (586.80) (272.39) (586.80) Income tax recognized in other income For the year ended 31/03/2018 For the year ended 31/03/2017 Particulars Tax (expense) Tax (expense) Before tax benefit Net of tax Before tax benefit Net of tax Remeasurement of defined benefit liability 0.69 - 0.69 (9.36) - (9.36) Remeasurement of Equity instrunment through OCI (0.06) - (0.06) 28.76 - 28.76

Reconciliation of effective tax rate - A reconciliation of the income tax expenses to the amount computed by applying the statutory income tax rate to the profit before income taxes is summarized below: (₹ in Lakh) For the year ended For the year ended Particulars 31/03/2018 31/03/2017 Profit from continuing operations before income tax expense (1,039.18) (4,251.45) Tax at the Indian Tax Rate of (previous year 30.9%) (298.76) (1,313.70) Permanent disallowances - - Permanent allowances - - Temporary differences (283.44) (586.80) Tax in respect of earlier years 11.05 - Tax losses for which no deferred tax was recognised 298.76 1,313.70 Total income tax expense/(credit) (272.39) (586.80) Effective tax rate 26.21% 13.80% - Tax computation for 2017-18 was not finalized during the time of preparation. The above reconciliation is on the assumption that there won't any allowances or disallowances other than the ones taken for deferred tax computation.

NOTE 33 : Other comprehensive income (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Actuarial gain/(loss) on defined benefit obligation 0.69 (9.36) Equity instrunment through other comperhensive income (0.06) 28.76 Tax effect of the above - - 0.63 19.40

NOTE 34 : Fair Value Hierarchy The management has assessed that its financial assets and liabilities like cash and cash equivalents, trade receivables, trade payables, cash credits, buyers credit and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments. The following methods and assumptions were used to estimate the fair values for the given below financial assets. Quoted Equity Instrunment and Mutual Funds: The fair values of the unquoted equity shares measured using quoted prices. This includes listed equity instruments and mutual funds that have quoted Unquoted Equity Shares of Other Companies: The fair values of the unquoted equity shares have been estimated using NAV model. Preference Shares The value of the preference shares are based on the leding rate avaliable

31.03.2018 31.03.2017 01.04.2016 Particulars Significant observable inputs Significant observable inputs Significant observable inputs Level 1 Level 3 Level 1 Level 3 Level 1 Level 3 Financial Assets Investment in Quoted instrunments I.D.B.I.Ltd 1.50 1.56 1.51 ICICI Prudential Infrastructure - - 15.53 L&T Oppurtunities Fund - - 19.22 UTI Master Growth - - 6.62 Investment in Unquoted instrunments Kerala Enviro Infrastructure Limited 0.79 0.79 0.72 Jala Shaayi Alamparathodu Hydro Power Ltd 4.70 4.70 4.70 Sree Kailas Palchuram Hydro Power Ltd 4.70 4.70 4.70 Sree Adi Sakthi Mukkuttathode Hydro Power Ltd 4.70 4.70 4.70 Financial Liabilities

Preference shares 1,090.82 1,066.39 1,049.60

Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments, traded bonds and mutual funds that have quoted price. The fair value of all equity instruments (including bonds) which are traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual funds are valued using the closing NAV. The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the-counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in Level 2. If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3. This is the case for unlisted equity securities, contingent consideration and indemnification asset included in Level 3.

NOTE 35 : Contingent liabilities and Commitments (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Unexpired Contracts for Capital Expenditure 260.61 260.61 Amount of Income tax liabilities disputed in appeal 22.18 38.21 Guarantee given on behalf of the Company - 94.00 Excise duty disputed under appeal 350.79 350.79 Claim towards water charge raised by Kerala Water Authority 78.42 78.42 Customs duty liability under EPCG claim 58.79 58.79 Arrears of non - convertible cumulative preference dividend 537.70 402.30 1,308.49 1,283.12

NOTE 36 : Additional Information I Information on Imports, Exports & Foreign Currency / Exch. Transactions. (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 a) Value of Imports on CIF Basis i) Raw Materials & Consumables NIL 989.80 ii) Components and Spare Parts NIL NIL iii) Capital Goods NIL NIL NIL 989.80 b) Other Expenditure in Foreign Currencies (on cash basis) i) Expenses on Foreign travel NIL NIL ii) Books, Periodicals, & Subscriptions NIL NIL iii) Expenses towards Technical Services NIL NIL NIL NIL

c) Value of Exports on FOB Basis NIL NIL II Details of Provisions Pursuant to Ind AS 37 – Provisions, Contingent Liabilities and Contingent Assets Particulars Sundry Debtors Income tax Gratuity & Leave Capital Advances Deposits encashment As at 1st april 2016 235.41 75.66 70.56 83.00 28.67 Provision made during the year 547.59 - (60.96) 4.34 23.47 Provision utilized during the year - (15.00) - - - As at 31st march 2017 783.00 60.66 9.60 87.34 52.14 Provision made during the year - 11.05 - - - Provision utilized during the year (61.96) - (1.17) - - As at 31st march 2018 721.04 71.71 8.43 87.34 52.14

For KPR & Co For and on behalf of the Board Chartered Accountants FRN: 05326S Sd/- Sd/- Sd/- R.Ponnambalam S.Rajkumar, Deepa Praveen, ACA Company Secretary Vice Chairman & Managing Director M. No.232410 Partner Sd/- Sd/- Cochin -16 V.N.Sridharan N. Subramanian 13.06.2018 Chief Financial Officer Director

III Details in respect of related parties pursuant to IND AS 24 Name of Related party Nature of Relationship Details of Transactions Amount (Rs in Lakhs) Nature of Transactions 2017-18 2016-17 Managerial Remuneration 8.85 Unsecured Loan (246.37) 931.10 Rent 7.40 Key Management Personnel(Vice Chairman & 1 Mr S Raj Kumar Managing Director) Issue Of Share Capital including Share Premium 94.60 -

Issue of Share Warrant 235.40 -

2 MrsRajeeRajkumar unsecured Loan 13.58 - Sitting Fees 0.10 - 3 Mr Vignesh Rajkumar No transaction - - 4 Mr Visakh Rajkumar No transaction - - 5 Mrs E Kamalam Sitting Fees - 0.10 Relative of Key Management Personnel Sitting Fees 0.20 0.50 6 Mr. S. Subramaniam Sales of Fixed Asset - 8.00 Rent - 2.08 7 Mr. A Ganesh Rent - 2.76 Unsecured Loan - 208.75 8 Mr. S Giridhar Sitting Fees - 0.90 Remuneration and Allowances - 8.00 Key Management Personnel (Executive Unsecured Loan (2.73) 49.83 9 Mr A.Padmanabhan Director) Sale of fixed asset - 3.00 Rent - 0.24 Key Management Personnel (Director 10 VVM Rao Operations) Remuneration and Allowances - 8.39

ShriKailash Logistics 11 Unsecured Loan - 712.00 Limited Interest on Unsecured Loan - 32.61 Sreeniketana Logistics 12 Freight Charges - 68.95 Limited SreeKailash Logistics 13 Sale of Scrap Chennai Limited 4.065 Purchase of Raw Material - - Sale of Finished Goods 0.38 48.88 12 Carto Packs

Sale of Goods 31.34 33.37 13 Aditya Papers Enterprises over which any person mentioned in 1 to 6 above is able to exercise significant 14 SreeSakthi Constructions Civil work - 18.67 influence and Infrastructure (P) Ltd Unsecured Loan (1.50) 116.85 Maharaja Continental 15 Reimbursement of expenses - 11.26 Trades Ltd Sales Commission - 30.31 Purchase of Raw Material - 400.85 Reimbursement of expenses - 11.50 16 Sree Giri Packagings Advance given 11.20 - Sale of Finished Goods 6.99 11.00 Very Same Industrial Aids Sale of Goods - 4.66 17 Ltd Purchase of Raw Material - 191.94 Sree Kashyap Surya Energy 18 No transaction - - Equipments Pvt Ltd

Unsecured Loan 62.05 - 19 Visakh Homes Advance for Scrap Sale 14.20 - Interest on advance 0.11 0.75 JalaShaayi Alamparathodu Investment in subsidiary 21 4.70 4.70 Hydro Power Ltd. company Advance (10.28) 0.57 Interest on advance 1.15 1.56 Sree Kailas Palchuram 22 Subsidiary Investment in subsidiary Hydro Power Ltd. 4.70 4.70 company Advance (7.29) 0.48 Interest on advance 0.24 0.79 Sree Adi Sakthi Investment in subsidiary 23 Mukkuttathode Hydro 4.70 4.70 company Power Ltd. Advance 9.87 0.60

Note: Shri Kailash Logistics Limited was a related party as per Ind AS 24, till 30.12.2016

SREE SAKTHI PAPER MILLS LIMITED CIN : L93000KL1991PLC006207

Notes forming part of the Financial Statements

NOTE 37 : Explanation to transition to Ind AS

As stated in Note 2 (a), these are the Company’s first financial statements prepared in accordance with Ind AS. For the year ended 31 March 2016, the Company had prepared its financial statements in accordance with Companies (Accounting Standards) Rules, 2006, notified under Section 133 of the Act and other relevant provisions of the Act (‘previous GAAP’).

The accounting policies set out in Note 3 have been applied in preparing these financial statements for the year ended 31 March 2018 including the comparative information for the year ended 31 March 2017 and the opening Ind AS balance sheet on the date of transition i.e. 1 April 2016. In preparing its Ind AS balance sheet as at 1 April 2016 and in presenting the comparative information for the year ended 31 March 2017, the Company has adjusted amounts reported previously in financial statements prepared in accordance with previous GAAP. This note explains the principal adjustments made by the Company in restating its financial statements prepared in accordance with previous GAAP, and how the transition from previous GAAP to Ind AS has affected the Company’s financial position, financial performance and cash flows. Optional exemptions availed and mandatory exceptions: In preparing these financial statements, the Company has applied the below mentioned optional exemptions and mandatory exceptions.

A Optional exemptions availed

1 Property plant and equipment, intangible assets and investment properties As per Ind AS 101 an entity may elect to: i. measure an item of property, plant and equipment at the date of transition at its fair value and use that fair value as its deemed cost at that date ii. use a previous GAAP revaluation of an item of property, plant and equipment at or before the date of transition as deemed cost at the date of the revaluation, provided the revaluation was, at the date of the revaluation, broadly comparable to: a. fair value; b. or cost or depreciated cost under Ind AS adjusted to reflect, for example, changes in a general or specific price The elections under (i) and (ii) above are also available for intangible assets that meets the recognition criteria in Ind AS 38, Intangible Assets, (including reliable measurement of original cost); and criteria in Ind AS 38 for revaluation (including the existence of an active market). iii. use carrying values of property, plant and equipment, intangible assets and investment properties as on the date of transition to Ind AS (which are measured in accordance with previous GAAP and after making adjustments relating to decommissioning liabilities prescribed under Ind AS 101). As permitted by Ind AS 101, the Company has elected to continue with the carrying values under previous GAAP for all the property, plant and equipment. The same election has been made in respect of intangible assets and investment property also.

A Mandatory exceptions

1 Estimates As per Ind AS 101, an entity’s estimates in accordance with Ind AS at the date of transition to Ind AS at the end of the comparative period presented in the entity’s first Ind AS financial statements, as the case may be, should be consistent with estimates made for the same date in accordance with the previous GAAP unless there is objective evidence that those estimates were in error. However, the estimates should be adjusted to reflect any differences in accounting policies. As per Ind AS 101, where application of Ind AS requires an entity to make certain estimates that were not required under previous GAAP, those estimates should be made to reflect conditions that existed at the date of transition (for preparing opening Ind AS balance sheet) or at the end of the comparative period (for presenting comparative information as per Ind AS).

2 Classification and measurement of financial assets Ind AS 101 requires an entity to assess classification of financial assets on the basis of facts and circumstances existing as on the date of transition. Further, the standard permits measurement of financial assets accounted at amortized cost based on facts and circumstances existing at the date of transition if retrospective application is impracticable. Accordingly, the Company has determined the classification of financial assets based on facts and circumstances that exist on the date of transition. Measurement of the financial assets accounted at amortized cost has been done retrospectively except where the same is impracticable. 87

Reconciliation of Equity (₹ in Lakh) As at April 1, 2016 Particulars Previous GAAP Adjustments Ind AS I. Assets

1 Non-current assets Property,Plant & Equipment 5,502.65 - 5,502.65 Capital work-in progress 22.92 - 22.92 Goodwill Other Intagible Assets 0.16 - 0.16 Intagible Assets under development Financial Assets Investments 66.98 (9.28) 57.70 Trade receivables Loans 151.51 (40.25) 111.26 Deferred tax assets (net) Other non•current assets - 40.25 40.25

2 Current Assets Inventories 998.51 (112.15) 886.36 Financial Assets Investments Trade receivables 1,664.34 - 1,664.34 Cash and cash equivalents 364.29 (10.95) 353.34 Bank balances other than (iii) above Loans 571.74 (560.79) 10.95 Others (to be specified) Tax Assets (Net) - - - Other current assets 15.68 571.74 587.42 Asset held for sale - 112.15 112.15 TOTAL 9,358.78 (9.28) 9,349.50

II. Equity & Liabilities

1 Equity Equity share capital 2,643.62 (1,000.00) 1,643.62 Other equity (185.33) (58.88) (244.21)

2 Liabilities

Non-Current Liabilities Financial Liabilities Borrowings 856.91 1,049.60 1,906.51 Trade Payables Other financial liabilities Provisions 65.78 - 65.78 Deferred tax liabilities (Net) 898.02 - 898.02 Other non•current liabilities 1.43 - 1.43

3 Current Liabilities Financial Liabilities Borrowings 2,270.11 - 2,270.11 Trade payables 1,810.16 - 1,810.16 Other financial liabilities - 164.87 164.87 Other Current Liabilities 917.64 (164.87) 752.77 Provisions 80.44 - 80.44 Current Tax Liabilities 88 TOTAL 9,358.78 (9.28) 9,349.50 (₹ in Lakh) As at 31 March, 2017 Particulars Previous GAAP Adjustments Ind AS I. Assets

1 Non-current assets Property,Plant & Equipment 965.80 0.00 965.80 Capital work-in progress - - - Goodwill Other Intagible Assets 0.16 - 0.16 Intagible Assets under development Financial Assets Investments 15.45 1.00 16.45 Trade receivables Loans 40.69 (40.69) - Deferred tax assets (net) Other non•current assets - 40.69 40.69

2 Current Assets Inventories 2,501.47 (2,410.36) 91.11 Financial Assets Investments Trade receivables 334.38 - 334.38 Cash and cash equivalents 27.65 (10.90) 16.75 Bank balances other than (iii) above Loans 328.92 (328.92) - Others (to be specified) Tax Assets (Net) - - - Other current assets 0.02 339.82 339.84 Asset held for sale - 2,410.36 2,410.36

TOTAL 4,214.54 1.00 4,215.54

II. Equity & Liabilities

1 Equity Equity share capital 2,643.62 (1,000.00) 1,643.62 Other equity (3,843.47) (65.39) (3,908.86)

2 Liabilities Non-Current Liabilities Financial Liabilities Borrowings 703.86 1,066.39 1,770.25 Trade Payables Other financial liabilities Provisions 8.06 - 8.06 Deferred tax liabilities (Net) 311.22 (0.00) 311.22 Other non•current liabilities 1.43 0.00 1.43

3 Current Liabilities Financial Liabilities Borrowings 3,391.02 (0.00) 3,391.02 Trade payables 495.83 (0.00) 495.83 Other financial liabilities - 183.75 183.75 Other Current Liabilities 440.77 (183.74) 257.03 Provisions 62.20 (0.00) 62.20 Current Tax Liabilities

TOTAL 89 4,214.54 1.00 4,215.54

* Previous GAAP figures have been reclassified to conform to IND AS presentation requirements for the purpose of the note. Reconciliation of total comprehensive income for the year ended 31-March -2016 (₹ in Lakh) For the year 31 March, 2017 Particulars Previous GAAP Adjustments Ind AS I Revenue From Operations 2,782.31 111.41 2,893.72 II Other income 111.74 0.00 111.74 III Total Income 2,894.05 111.42 3,005.47 IV Expenses Cost Of Material Consumed 1,726.81 0.00 1,726.81 Purchase of stock-in-Trade 221.64 - 221.64 Changes In Inventory 296.88 0.00 296.88 Excise Duty - 111.41 111.41 Employee Benefit Expenses 365.82 (9.36) 356.46 Finance costs 553.68 16.79 570.47 Depreciation and ammortisation expenses 138.48 (0.00) 138.48 Other Expenses 1,730.92 42.48 1,773.40 Total expenses(IV) 5,034.23 161.33 5,195.56 V Profit/(Loss) before, exceptional items and tax (I-II) (2,140.18) (49.91) (2,190.09) VI Exceptional Items [(expense) / income] VII Extraordinary items - Impairment 2,080.76 (2,080.76) - - Cost of waste removel by pollution control board 24.00 (24.00) - VII Profit/(Loss) before tax (4,244.94) 2,054.85 (2,190.09) VIII Tax expense Current income tax - - - Tax adjustments for previous year - - - Deffered Tax (586.80) (0.00) (586.80) (586.80) (0.00) (586.80) IX Profit/(Loss) for the period from continuing operations(VIII+IX) (3,658.14) 2,054.85 (1,603.29) X Other comprehensive income (i) Items that will not be reclassified to P/L - 19.40 19.40 (ii) Income tax relating to items that will not be reclassified to P/L - - - XI Total comprehensive income for the period(IX+X) (3,658.14) 2,074.25 (1,583.89)

90 d) Prior period and Extra-ordinary assets The provisions of Ind-AS 8 requires that an entity will correct prior period errors retrospectively in the first set of the financial statements approved for issue after their discovery by restating the comparative amounts for the prior period(s) presented in which the error occurred. If the error occurred before the earliest prior period presented, it will restate the opening balance of assets, liabilities and equity for the earliest prior period presented.

However, as per the provisions of section 131 of the Companies Act, 2013 if it appears to the Company that any change is required to the financial statements, they may prepare a revised financial statements only after obtaining the prior approval of the Tribunal. Given that the provisions of Ind-AS 8 which require revision of the figures of the previous financial years are not in sync with section 131 of the Companies Act, 2013, the Company is of the view that all such items of income and expenses relating to the prior periods in FY 2015-16 be adjusted in the financial statements for the FY 2015-16. On transition to Ind AS prior period items and extra-ordinary items are classified to the corresponding income/expenses in the year of recognition itself for recognition of prior period and extra-ordinary items are not permitted in Ind AS.However, this has no impact on the total comprehensive income and total equity as on 1 April 2016 or as on 31 March 2017. e) Preference shares Under previous GAAP, redeemable preference shares were classified as part of total equity. However, under Ind AS, financial instruments are classified as a liability or equity according to the substance of the contractual arrangement and not it's legal form. These preference shares do not contain any equity component and hence, have been classified in their entirely as a financial liability under Ind AS f) Fair value of investment In accordance with Ind AS, financial assets representing investment in equity shares have been fair valued. The Company has designated these investments at fair value through other comprehensive income as permitted by Ind AS 109. Under the previous GAAP, the application of the relevant accounting standard resulted in all these investments being carried at cost. g) Earmarked deposit Under previous GAAP, earmarked deposit with bank were classified as part of cash and cash equivalents. However, under Ind AS, earmarked deposit are grouped under other current assets.

SREE SAKTHI PAPER MILLS LIMITED CIN : L93000KL1991PLC006207 Statement of Cash Flow for the period ended March 31, 2018 (₹ in Lakh) For period ended For period ended Particulars March 31, 2018 March 31, 2017 A CASH FLOW FROM OPERATING ACTIVITIES Total Comprehensive Income (766.79) (3,664.65) Adjustments for : Provision for Income-tax (272.39) (586.80) Depreciation, amortisation and impairment 161.08 2,242.09 Interest Income (3.18) (21.69) (Profit)/Loss on write off/ sale of Fixed Assets (915.25) (8.69) (Profit)/Loss on write off/ sale of investment - (4.98) Fair value change in investment through OCI (0.06) Mat credit written off 300.38 Finance Cost 213.97 570.47 Operating Profit before working capital changes (1,282.24) (1,474.26) Decrease(Increase) in Inventories 91.11 795.25 Decrease(Increase) in Trade receivable 155.23 1,329.96 Decrease(Increase) in Loans and Advances (0.06) 122.21 Decrease(Increase) in other non current assets 27.11 (0.44) Decrease(Increase) in other current 1,763.11 247.58 assets & assets held for sale Increase(Decrease) in Trade payable (115.49) (1,314.33) Increase(Decrease) in Current Liabilities 296.77 (513.99) Increase(Decrease) in Other Non Current Liabilities 0.38 (57.72) Cash from Operations 935.92 (865.74) Income Tax paid (9.62) - Cash from Operating before exceptional Items 926.30 (865.74) Exceptional Items - - Cash from Operating Activities 926.30 (865.74) B CASH FLOW FROM INVESTING ACTIVITIES Proceeds on Sale of Fixed Assets 950.00 28.05 Proceeds on Sale of investment - 46.35 Interest Income 3.18 21.69 Net Cash from Investing Activities 953.18 96.09 C CASH FLOW FROM FINANCING ACTIVITIES Net Proceeds from - Issue of shares 94.60 - - Issue of shares warrants 235.40 - - Borrowings (1,372.69) 1,198.59 Interest paid (213.97) (570.47) Net Cash from Financing Activities (1,256.66) 628.12 D TOTAL INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS DURING THE YEAR (A+B+C) 622.82 (141.52) Cash and cash equivalents at the beginning of the year (1,309.73) (1,168.21) Cash and cash equivalents at the end of the year (686.91) (1,309.73) Components of cash and cash equivalents Balance with Banks In Current Accounts 22.32 3.81 In Deposit Accounts 1.05 12.85 Cash in Hand 1.40 0.08 Cash Credit (711.68) (1,326.48) Total cash and cash equivalents (686.91) (1,309.73) For KPR & Co For and on behalf of the Board Chartered Accountants FRN: 05326S Sd/- Sd/- Sd/- R.Ponnambalam S.Rajkumar, Deepa Praveen, ACA Company Secretary Vice Chairman & Managing Director M. No.232410 Partner Sd/- Sd/- Cochin -16 V.N.Sridharan N. Subramanian 13.06.2018 Chief Financial Officer Director 92

Form AOC-1

(Pursuant to first proviso to sub-section (3) of Section 129 read with Rule 5 of Companies (Accounts) Rules, 2015)

Statement containing salient features of the financial statement of subsidiaries/ associate companies/joint ventures Part “A”: Subsidiaries (Information in respect of each subsidiary to be presented with amounts in Rs.) No. Particulars Details Details 1 Name of the subsidiary Sree Kailas Palchuram Sree Adisakthi Jalashaayi Hydro Power Ltd Mukkuttathode Alamparathode Hydro Power Ltd Hydro Power Ltd

Reporting period for the 01.04.2017 to 01.04.2017 to 01.04.2017 to subsidiary concerned, if different 31.03.2018 31.03.2018 31.03.2018 from the holding company’s reporting period

Reporting currency and Exchange No Foreign Subsidiary No Foreign Subsidiary No Foreign Subsidiary rate as on the last date of the relevant Financial year in the case of foreign subsidiaries

Share capital 10,00,000.00 10,00,000.00 10,00,000.00

Reserves & surplus (3,22,457.00) 1,62,221.00 2,70,209.00

Total assets 4,221.00 - -

Total Liabilities 13,63,328.00 1,30,969.00 61,389.00

Investments - - -

Turnover - - -

Profit before taxation -52,181.00 72,782.00 24,300.00

Provision for taxation -29,494.00 28,771.00 28,989.00

Profit after taxation -81,645.00 44,011.00 -4,689.00

Proposed Dividend - - -

% of shareholding 47.00 47.00 47.00

Notes: The following information shall be furnished at the end of the statement:

1. Names of subsidiaries which are yet to commence operations:

a) Sree Kailas Palchuram Hydro Power Ltd b) Sree Adisakthi Mukkuttathode Hydro Power Ltd c) Jalashaayi Alamparathode Hydro Power Ltd

2. Names of subsidiaries which have been liquidated or sold during the year: Nil

Part “B”: Associates and Joint Ventures Statement pursuant to Section 129 (3) of the Companies Act, 2013 related to Associate Companies and Joint Ventures Name of associates/Joint Ventures Nil

1. Latest audited Balance Sheet Date Nil

2. Shares of Associate/Joint Ventures held by the Company on Nil the year end. i. No. Nil ii. Amount of Investment in Associates/Joint Venture Nil iii. Extend of Holding% Nil

3. Description of how there is significant influence Nil

4. Reason why the associate/joint venture is not consolidated Nil

5. Net worth attributable to shareholding as per latest audited Balance Sheet Nil

6. Profit/Loss for the year Nil

i. Considered in Consolidation Nil

ii. Not Considered in Consolidation Nil

1. Names of associates or joint ventures which are yet to commence operations. 2. Names of associates or joint ventures which have been liquidated or sold during the year.

Note: This Form is to be certified in the same manner in which the Balance Sheet is to be certified.

For and on behalf of the Board

Sd/- Sd/- R.Ponnambalam S.Rajkumar Company Secretary Vice Chairman & Managing Director

Sd/- Sd/-

V.N. Sridharan N. Subramanian Chief Financial Officer Director

Independent Auditor’s Report on Consolidated Financial Statements

To the Members of M/s. Sree Sakthi Paper Mills Limited, Kochi.

Report on the Consolidated Financial Statements

We have audited the accompanying Consolidated Financial Statements of M/s. Sree Sakthi Paper Mills Limited, Kochi (herein after referred to as “the Holding Company”) and its subsidiaries – Sree Adi Sakthi Mukuttathodu Hydro Power limited, Sree Kailas Palchuram Hydro Power Limited and Jalashaayi Alamparathodu Hydro Power Limited (the Holding Company and its Subsidiaries together referred to as “the Group” which comprises of:-

The Consolidated Balance Sheet as at 31st March, 2018.

(a) The Consolidated Statement of Profit and Loss (including other comprehensive income) for the year ended 31st March 2018. (b) The Consolidated Cash Flow Statement for the year ended 31st March 2018. (c) The Consolidated statement of changes in equity for the year ended 31st March 2018. (d) A Summary of significant accounting policies and other explanatory information. (hereinafter referred to as “the consolidated financial statements”)

Management’s responsibility for the Consolidated financial statements

The Holding Company’s Board of Directors is responsible for the preparation of these consolidated financial statements in terms of the requirements of the Companies Act, 2013 (hereinafter referred to as “the Act”) that give a true and fair view of the consolidated financial position, consolidated financial performance (including other comprehensive income), consolidated cash flows and consolidated statement of changes in equity of the group in accordance with the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, and other accounting principles generally accepted in India. The respective Board of Directors of the companies included in the Group is responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Group and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Consolidated financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which have been used for the purpose of preparation of the consolidated financial statements by the Directors of the Holding Company, as aforesaid.

Auditor’s Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audit. While conducting the audit, we have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Consolidated Financial Statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Consolidated Financial Statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the Consolidated Financial Statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Holding Company’s preparation of the Consolidated financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Holding Company’s Directors, as well as evaluating the overall presentation of the Consolidated Financial Statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Consolidated Financial Statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Consolidated financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles

95 generally accepted in India, of the consolidated state of affairs (financial position) of the Group as at 31st March, 2018; and its consolidated LOSS and its consolidated cash flows for the year ended on that date.

Emphasis of Matter

We invite the attention of the users to –

(a) Note No. 2(e) of the Significant Accounting Policies regarding the validity of Going

Concern assumption for the company in preparation of the consolidated financial statements;

(b) Note No. 13 of the Significant Accounting Policies regarding lack of external confirmation of balances for receivables and payables including balances due to / from group concerns.

Our report is not qualified in respect of the above matters.

.Report on other legal and regulatory requirements

1. As required by section 143(3) of the Act, we report, to the extent applicable, that: a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit of the aforesaid consolidated financial statements. b) In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books. c) The Consolidated Balance Sheet, Consolidated Statement of Profit and Loss, the Consolidated Cash Flow Statement, and Consolidated Statement of changes in Equity dealt with by this Report are in agreement with the books of account maintained for the purpose of the consolidated financial statements. d) In our opinion, the aforesaid Consolidated financial statements comply with the Accounting Standards specified under section 133 of the Act, read with Rule 7 of Companies (Accounts), Rules 2014/ /Indian Accounting Standards specified under Section 133 of the Act. e) On the basis of written representations received from the directors of the Holding Company as on 31st March 2018, taken on record by the Board of Directors of the Holding Company, none of the directors is disqualified as on March 31, 2018, from being appointed as a director in terms of sub-section (2) of section 164 of the Companies Act, 2013. f) The report on internal financial control as required under clause (i) of sub section 3 of section 143 of the Companies Act 2013 is attached as Annexure A. g) With respect to other matters to be included in the Auditors Report in accordance with Rule 11 of Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Group has disclosed the impact of pending litigations on its financial position in its Consolidated financial statements.

ii. The Group has made provisions, as required under any law or accounting standard, for material foreseeable losses.

iii. The Group has not transferred the equity shares corresponding to Unpaid dividend where the specified period under 124(5) has been completed, within the due date of 31st October 2017. However there has been no delay in transferring such Unpaid dividends to Investor Education and Protection Fund by the Group.

For KPR & Co Chartered Accountants FRN: 5326S

Sd/- Deepa Praveen, ACA Kochi -11 Memb No: 232410 13.06.2018 Partner

ANNEXURE B TO THE INDEPENDENT AUDITOR’S REPORT OF EVEN DATE ON THE CONSOLIDATED FINANCIAL STATEMENTS OF SREE SAKTHI PAPER MILLS LIMITED

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (‘the Act’)

We have audited the internal financial controls over financial reporting of Sree Sakthi Paper Mills Ltd (the company) as of 31st March, 2018 in conjunction with our audit of the consolidated financial statements of the company for the year ended on that date.

Management’s responsibility for Internal Financial Controls

Auditor’s Responsibility

Meaning of internal financial controls over financial reporting

A company’s internal financial controls over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial controls over financial reporting includes those policies and procedures that (1) [pertain to the maintenance of the records that, in reasonable detail, accurately and fairy reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that the transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that the receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding the prevention or timely deduction of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the Consolidated financial statements .

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion of improper management override of controls, material misstatements due to error or fraud may occur and not be deducted. Also, projections of any evaluation of the internal financial controls over the financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions , or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

According to the information and explanations given to us and based on our audit, the following material weaknesses have been revealed as at March 31, 2018:

The internal control system and the internal audit system established by the company for recording of financial transactions in time was not operating effectively due to which there was considerable delay in recording, reconciling and reporting the financial information on a timely basis.

In our opinion, except for the effects/possible effects of the material weaknesses described above on the achievement of the objectives of the control criteria, the Company hasmaintained, in all material respects, adequate internal financial controls over financial reporting and such internal financial controls over financial reporting were operating effectively as of March 31, 2018, based on the internal control over the financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of internal Financial Reporting issued by the Institute of Chartered Accountants of India.

We have considered the material weaknesses identified and reported above in determiningthe nature, timing, and extent of audit tests applied in our audit of the March 31, 2018 financial statements of the Company, and these material weaknesses does not affectour opinion on the financial statements of the Company.

For KPR & Co Chartered Accountants FRN: 5326S

Sd/- Deepa Praveen, ACA Kochi -11 Memb No: 232410 13.06.2018 Partner

SREE SAKTHI PAPER MILLS LIMITED AND ITS SUBSIDIARIES CIN : L93000KL1991PLC006207 Consolidated Balance Sheet as at March 31, 2018 (₹ in Lakh) As at As at As at Particulars Note March 31, 2018 March 31, 2017 April 1, 2016 I. Assets 1 Non-current assets - Property,Plant & Equipment 4 770.15 965.82 5,502.69 - Capital work-in progress 5 - - 22.92 - Other Intangible Assets 6 - 0.16 0.16 - Financial Assets Investments 7A 2.29 2.35 43.60 Loans 7B 0.06 - 111.26 - Deferred tax assets (net) - Other non•current assets 8 - - 4.31

2 Current Assets - Inventories 9 - 91.11 886.36 - Financial Assets Trade receivables 10A 179.15 334.38 1,664.34 Cash and cash equivalents 10B 63.07 84.66 416.77 Loans 10C 5.00 5.00 15.95 - Other current assets 11 325.29 349.02 587.90 - Assets held for sale 374.00 2,410.36 112.16 TOTAL 1,719.02 4,242.86 9,368.42 II. Equity & Liabilities 1 Equity - Equity share capital 12 1,729.62 1,643.62 1,643.62 - Other equity 13 (4,431.74) (3,908.14) (243.88) - Non-controlling interests 17.06 16.70 16.28

2 Liabilities Non-Current Liabilities - Financial Liabilities Borrowings 16A 1,090.82 1,770.24 1,906.51 - Provisions 17 8.43 8.06 65.78 - Deferred tax liabilities (Net) 18 27.86 311.26 898.06 - Other non•current liabilities 19 1.43 1.43 1.43

3 Current Liabilities - Financial Liabilities Borrowings 16B 2,259.52 3,391.02 2,270.11 Trade payables 20 380.34 495.83 1,810.16 Other financial liabilities 21 7.18 183.75 164.87 - Other Current Liabilities 22 555.91 266.12 753.56 - Provisions 17 72.58 62.97 81.91 TOTAL 1,719.02 4,242.86 9,368.42 Summary of significant accounting policies 1,2,3 The accompanying notes form an integral part of the financial statements For KPR & Co For and on behalf of the Board Chartered Accountants FRN: 05326S Sd/- Sd/- Sd/- Deepa Praveen, ACA R.Ponnambalam S.Rajkumar, Company Secretary Vice Chairman & M. No.232410 Managing Director Partner Cochin -16 Sd/- Sd/- 13.06.2018 V.N.Sridharan N. Subramanian Chief Financial Officer Director 99

SREE SAKTHI PAPER MILLS LIMITED AND ITS SUBSIDIARIES CIN : L93000KL1991PLC006207 Consolidated profit and loss for the period ended March 31, 2018 (₹ in Lakh) For period ended For period ended Particulars Note March 31, 2018 March 31, 2017 I Revenue From Operations 23 162.79 2,893.72 II Other income 24 994.76 113.93 III Total Income 1,157.55 3,007.65 IV Expenses - Cost Of Material Consumed 25 - 1,726.81 - Purchase of stock-in-Trade - 221.64 - Changes In Inventory 26 26.92 296.88 - Excise Duty 0.36 111.41 - Employee Benefit Expenses 27 78.94 356.46 - Finance costs 28 213.97 570.71 - Depreciation and ammortisation expenses 29 73.07 138.48 - Impairment loss Property,Plant & Equipment 88.00 2,080.76 - Other Expenses 30 131.19 1,774.12 Total expenses(IV) 612.45 7,277.28 V Profit/(Loss) before, exceptional items and tax (I-II) 545.10 (4,269.64) VI Exceptional Items [(expense) / income] 31 (1,584.50) - VII Profit/(Loss) before tax (1,039.41) (4,269.64) VIII Tax expense - Current income tax 0.87 - - Tax adjustments for previous year 32 11.05 - - Deffered Tax 32 (283.44) (586.40) (271.52) (586.40) IX Profit/(Loss) for the period from continuing operations(VIII+IX) (767.88) (3,683.23) Attributable to: Equity holders of the parent (768.24) (3,683.66) Non-controlling interests 0.35 0.43 X Other comprehensive income - Items that will not be reclassified to Profit or Loss 33 0.63 19.40 - Income tax relating to items that will not be reclassified to Profit or Loss 33 - - XI Total comprehensive income for the period(IX+X) (767.26) (3,663.83) XII Earnings per Equity shares (of continuing operations) of Rs. 10/- each - Basic 17 (5.49) (23.23) - Diluted 17 (5.43) (23.23) Summary of significant accounting policies 1,2,3 The accompanying notes form an integral part of the financial statements For KPR & Co For and on behalf of the Board Chartered Accountants FRN: 05326S Sd/- Sd/- Sd/- R.Ponnambalam S.Rajkumar, Deepa Praveen, ACA Company Secretary Vice Chairman & Managing Director M. No.232410 Partner Sd/- Sd/- Cochin -16 V.N.Sridharan N. Subramanian 13.06.2018 Chief Financial Officer Director

100

SREE SAKTHI PAPER MILLS LIMITED AND ITS SUBSIDIARIES

CIN: L93000KL1991PLC006207

Annexure to Notes on Financial Statements for the Year ended March 31, 2018

Note 1 – Reporting Entity

Sree Sakthi Paper Mills Limited (the ‘Company’) is a company incorporated in India as a Limited Company on 3rd October, 1991, under the provisions of Companies Act, with the main objective of manufacturing of paper and paperboards.

Note 2 –

A statement of significant accounting policies:

A. Basis of preparation These financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015 notified under Section 133 of the Companies Act, 2013 (the ‘Act’) and the relevant provisions of the Act.

B. Basis of consolidation The consolidated financial statements incorporate the financial statements of the Company and entities (including structured entities) controlled by the Company and its subsidiaries. Control is achieved when the Company:

a) has power over the investee; b) has the ability to use its power to affect its return; c) is exposed, or has rights, to variable returns from its involvement with the investee. The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control listed above.

Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses control of the subsidiary. Specifically, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated statement of profit and loss from the date the Company gains control until the date when the Company ceases to control the subsidiary.

Adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with the Group's accounting policies.

All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the Group are eliminated in full on consolidation.

101

Following subsidiary company has been considered in the preparation of the consolidated financial statements:

Name of the entity Relationship % of Holding and voting power held directly

SREE ADISAKTHI MUKKUTTATHODE HYDRO POWER LIMITED Subsidiary 47%

JALASHAAYI ALAMPARATHODU HYDRO POWER LIMITED Subsidiary 47%

SREE KAILAS PALCHURAM HYDRO POWER LTD Subsidiary 47%

C. Functional and presentation currency These financial statements are presented in Indian Rupees (‘INR’), which is also the Company’s functional currency. All amounts have been rounded-off to the nearest lakhs, unless otherwise indicated.

D. Basis of Measurement The financial statements have been prepared on the historical cost basis as a going concern on accrual basis except for the following items:

Item Measurement Basis

Certain financial assets and liabilities Fair value

Net defined benefit Liability Present value of defined benefit obligations

E. Basis Of accounting a) Income from Sale of own products is accounted net of Excise Duty, Cess, Sales Tax and Discounts.

g. Use of Estimate and Judgements

In preparing these financial statements, management has made judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized prospectively.

102

proposal. The process of postal ballot has been already initiated and the results will be finalized before approval of the financial statements.

h. Measurement of Fair Values A number of the company’s accounting policies and disclosures require measurement of fair values, for both financial and non-financial assets and liabilities.

Fair values are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

The Company recognizes transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

Note 3 – Accounting Policies

7. Foreign currency i. Foreign Currency Transactions

Transactions in foreign currencies are translated into the functional currency of the Company at the exchange rates at the date of the transaction.

103

Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rate at the reporting date.

8. Income tax Income tax comprises current and deferred tax. It is recognized in profit or loss except to the extent that it relates to an item recognized directly in equity or in other comprehensive income.

I. Current Tax

II. Deferred Tax

9. Borrowing Cost Borrowing costs are interest and other costs (including exchange differences relating to foreign currency borrowings to the extent that they are regarded as an adjustment to interest costs) incurred in connection with the borrowing of fund. Borrowing costs directly attributable to acquisition or construction of an asset which necessarily take a substantial period of time to get ready for their intended use are capitalized as part of the cost of that asset. Other borrowing costs are recognized as an expense in the period in which they are incurred.

10. Cash flow statement Cash flow statements are prepared under Indirect Method whereby profit or loss is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments, and items of income or expense associated with investing or financing cash flows. Cash and cash equivalents comprise of cash in hand, current and other accounts (including fixed deposits) held with banks.

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11. Events occurring after the balance sheet date Assets and liabilities are adjusted for events occurring after the reporting period that provides additional evidence to assist the estimation of amounts relating to conditions existing at the end of the reporting period.

12. Property, Plant and equipment a. Recognition and Measurement

Land is capitalized on the basis of actual cost of acquisition, including establishment charges of land acquisition agency and legal expenses incurred for acquisition.

b. Capitalization of Assets and Charging of Depreciation

i) Fixed Assets are stated at cost. The cost of acquisition of Fixed Assets is inclusive of freight, duties, taxes, incidental expenses and the cost of installation/erection as applicable.

iv) Depreciation is in accordance with the provisions of Schedule II to the Companies Act, 2013. In the case of assets added /sold/discarded/transferred depreciation is charged on pro-rata basis.

v) Impairment of Property, Plant and Equipment (PPE) The evaluation of applicability of indicators of impairment of assets requires assessment of external factors (significant decline in asset’s value, significant changes in the technological, market, economic or legal environment, market interest rates etc.) and internal factors (obsolescence or physical damage of an asset, poor economic performance of the asset etc.) which could result in significant change in recoverable amount of the PPE.

2) Determination of the estimated useful lives Useful lives of all PPE are based on the estimation done by the Management which is in line with the useful lives as prescribed in Part ‘C’ of Schedule II to the Act. In cases, where the useful lives are different from those prescribed in Schedule II and in case of intangible assets, they are estimated by management based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers’ warranties and maintenance support.

3) Fixed Assets identified for disposal are stated at Net Block Value or Net Realizable value whichever is lower and are shown separately in the financial statements as asset held for sale.

4) Cost of Machinery Spares which can be used only in connection with an item of fixed asset and the use of which is expected to be irregular is allocated to the fixed assets and depreciated to the extent of 95% within a period not exceeding the useful life of the respective fixed asset. Individual spare parts having significant values are capitalized.

5) Borrowing cost relating to the acquisition/construction of qualifying assets are capitalized until the time all substantial activities necessary to prepare the qualifying assets for their intended use are complete. The qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

6) Subsequent Expenditures are capitalized only if it is probable that the future economic benefits associated with the expenditure will flow to the Company.

7. Intangible Assets :

a. Recognition, Measurement and Amortisation:

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b. Transition to IND AS

8. Valuation of investments: i. Financial instruments

Financial assets are not reclassified subsequent to their initial recognition, except if and in the period the Company changes its business model for managing financial assets.

A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as at FVTPL:

Financial assets that are held for trading or are managed and whose performance is evaluated on a fair value basis are measured at FVTPL.

Financial assets at FVTPL These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognized in profit or loss.

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Financial liabilities Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for-trading, or it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on de-recognition is also recognized in profit or loss. ii. De-recognition Financial assets The Company de-recognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the company neither transfers nor retains substantially all of the risks and rewards of ownership and does not retain control of the financial asset. If the company enters into transactions whereby it transfers assets recognized on its balance sheet, but retains either all or substantially all of the risks and rewards of the transferred assets, the transferred assets are not derecognized.

b) Finished Goods are accounted for at lower of the cost on FIFO Method or Net Realisable Value.

c) Semi-finished Goods (Work-in-Process) are valued at variable cost on Weighted Average Method.

10. Non-current assets held for sale Non-current assets comprising assets and liabilities are classified as held for sale if it is highly probable that they will be recovered primarily through sale rather than through continuing use.

Once classified as held-for-sale, intangible assets, property, plant and equipment and investment properties are no longer amortized or depreciated. 11. Retirement/Terminal Benefits/Bonus/Leave encashment a) Company’s liability towards employee benefits such as gratuity and leave encashment are provided for on the basis of actuarial valuation. b) Expenditure incurred on short term employee benefits including bonus, production incentive, medical benefits and other perquisites etc. are charged to the Profit and Loss Account at un-discounted amounts in the year in which services are rendered.

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12. Provisions, Contingent Liabilities and Contingent Assets a) Provisions (other than trade payables and accruals) as mentioned in the Ind As 37 issued by the Institute of Chartered Accountants of India are accounted for and disclosed to the extent practicable in the manner laid down in the said Accounting Standard. b) Contingent Liabilities disclosed in the Notes forming part of the Accounts comply with Ind As 37 to the extent practicable. c) Company has not recognized any Contingent Asset.

13. Additional Disclosures a) As the Company had terminated its business operations, the management is in the process of ascertaining and reconciling, wherever necessary, the realizable value of entire receivables of the company. b) As a matter of prudence, the company has already provided an amount of Rs 721.04 lakhs as provision towards ‘bad and doubtful debts / receivables’. In the opinion of the management, the above provision is sufficient to cover the entire doubtful debts of the company. c) As negotiations are going on with the debtors and creditors of the company for settlement of dues, we have not obtained the confirmation of balances as at the year end. Any additional liability required based on the reconciliations / settlement made with the debtors and creditors, will be provided in the due course. d) Compliance on transfer of Unpaid Dividend and Unclaimed Shares to IEPF Account

Sec 124(5) of the Companies Act, 2013 read with Rule 6 of Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rule, 2017, requires every company to transfer any unpaid dividend along with the corresponding equity shares outstanding for more than the period prescribed under Act to the Investor Education and Protection Fund (IEPF) Account.

The Ministry of Corporate Affairs (MCA) vide General Circular No. 12/2017 dated 16.10.2017 had notified the due date to transfer the equity shares where the specified period has completed.

The company has not transferred such equity shares .The Company is taking necessary steps to identify such equity shares and comply with the provisions of the Act.

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SREE SAKTHI PAPER MILLS LIMITED AND ITS SUBSIDIARIES CIN : L93000KL1991PLC006207

B. Other Equity (₹ in Lakh) Changes in Tax on other Opening balance Restated balance Total comprehensive Transfer to retained Closing balance Particulars accounting policy/ Dividends comprehensive as at 1 Apr 2016 as at 1 Apr 2016 income for the year earnings as at 31 Mar 2017 prior period errors income (i) Capital Reserve 36.68 - 36.68 - - - - 36.68 (ii) General Reserve 533.00 - 533.00 - - - - 533.00 (iii) Retained earnings (2,421.92) (28.12) (2,450.04) (3,683.66) - - - (6,133.70) (iv) Securities premium 1,667.24 - 1,667.24 - - - - 1,667.24 (v) Money received against share warrants ------(vi) Other comperhensive income - Actuarial gain/(loss) on defined benefit obligation - - - (9.36) - - - (9.36) - Equity instrunment through other comperhensive income - (30.76) (30.76) 28.76 - - - (2.00) Total reserves (185.00) (58.88) (243.88) (3,664.26) - - - (3,908.14)

(₹ in Lakh) Changes in Tax on other Opening balance Restated balance Total comprehensive Transfer to retained Closing balance Particulars accounting policy/ Dividends comprehensive as at 1 Apr 2017 as at 1 Apr 2017 income for the year earnings as at 31 Mar 2018 prior period errors income (i) Capital Reserve 36.68 - 36.68 - - - - 36.68 (ii) General Reserve 533.00 - 533.00 - - - - 533.00 (iii) Retained earnings (6,133.70) - (6,133.70) (768.24) - - - (6,901.93) (iv) Securities premium 1,667.24 - 1,667.24 8.60 - - - 1,675.84 (v) Money received against share warrants - - - 235.40 - - - 235.40 (vi) Other comperhensive income - - Actuarial gain/(loss) on defined benefit obligation (9.36) - (9.36) 0.69 - - - (8.67) - Equity instrunment through other comperhensive income (2.00) - (2.00) (0.06) - - - (2.06) Total reserves (3,908.14) - (3,908.14) (523.61) - - - (4,431.74)

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SREE SAKTHI PAPER MILLS LIMITED AND ITS SUBSIDIARIES CIN : L93000KL1991PLC006207

Notes forming part of the Financial Statements NOTE 4 Property,Plant & Equipment Furniture and Plant and Particulars Land Building Vehicle Office equipments Total fixtures machinery

Year ended 31 March, 2017

Gross Carrying Amount Deemed Cost as at 1 April 2016 233.27 744.12 18.20 4,469.12 26.79 11.19 5,502.69 Exchange differences ------Additions ------Disposals - - - 4,382.48 15.69 0.22 4,398.39

Closing Gross Carrying Amount 233.27 744.12 18.20 86.64 11.10 10.97 1,104.30

Closing Accumulated Depreciation - 59.73 4.29 62.80 6.71 4.94 138.48

Net Carrying Amount 233.27 684.39 13.91 23.84 4.39 6.03 965.82

Year ended 31 March, 2018

Gross Carrying Amount Opening Gross carrying amont 233.27 744.12 18.20 86.64 11.10 10.97 1,104.30 Exchange differences ------Additions ------Disposals 34.75 34.75

Closing Gross Carrying Amount 198.52 744.12 18.20 86.64 11.10 10.97 1,069.55

Closing Accumulated Depreciation - 207.98 8.69 64.65 10.45 7.61 299.39

Net Carrying Amount 198.52 536.14 9.51 21.99 0.65 3.36 770.15

(i) On transition to Ind AS, the Company has elected to continue with the carrying value of all of its property, plant and equipment recognised as at 1 April 2016 measured as per the previous GAAP and use that carrying value as the deemed cost of the property, plant and equipment. (ii) Borrowing costs capitalized during this year – Rs Nil Lakhs (2016-17 – Nil Lakhs ) (iii) The Company has paid entire value for 1.76 Acres of industrial land and has taken the posseession of the same at Edayar. Company has started using the land entirely by the beginning of 2013. Final clearance is awaited for effecting legal transfer of ownership. In view of the above and in accordance with subsatance and economic reality, this amount has been accounted as Land under Fixed Assets.

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SREE SAKTHI PAPER MILLS LIMITED AND ITS SUBSIDIARIES CIN : L93000KL1991PLC006207

Notes forming part of the Financial Statements NOTE 5- CWIP (₹ in Lakh) As at As at Particulars March 31, 2018March 31, 2017 Expenditure During Construction Period - - - - Details of Expenditure During Construction Period Opening Balance - 22.92 Add: Expenditure during the year: - - - Employees' Remuneration & Benefits - - - Project Management fee - - - Interest During Construction - - Total - 22.92 Total Expenditure - 22.92 Less: Transfer to Property, Plant & Equipment 22.92 Closing balance - -

NOTE 6- Other Intangible Assets (₹ in Lakh) Computer Particulars software Total

Year ended 31 March, 2017

Gross Carrying Amount Deemed Cost as at 1 April 2016 0.16 0.16 Additions - -

Closing Gross Carrying Amount 0.16 0.16

Accumulated Amortisation Amortisation charge during the year - -

Closing Accumulated Depreciation - -

Net Carrying Amount 0.16 0.16 Year ended 31 March, 2018 Gross Carrying Amount Opening Gross carrying amont 0.16 0.16 Additions - -

Closing Gross Carrying Amount 0.16 0.16 Accumulated Depreciation Opening accumulated depreciation - - Amortisation charge during the year - - Impairment charge 0.16 0.16

Closing Accumulated Depreciation 0.16 0.16 Net Carrying Amount - -

Transition to Ind AS On transition to Ind AS, the Company has elected to continue with the carrying value of all of its Intangible assets recognised as at 1 April 2016 measured as per the previous GAAP and use that carrying value as the deemed cost of the Other Intangible Assets. 111

SREE SAKTHI PAPER MILLS LIMITED AND ITS SUBSIDIARIES CIN : L93000KL1991PLC006207

Notes forming part of the Financial Statements NOTE 7 : Non Current Financial Assets NOTE 7A -Investment (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Investment carried at fair value through other comprehensive income Quoted - Equity Instruments 1.50 1.56 1.51 - Mutual Funds - - 41.37 Unquoted - Equity Instruments 0.79 0.79 0.72 A 2.29 2.35 43.60 Total investment 2.29 2.35 43.60

There are no financial investments measured at fair value through profit and loss * Details of investment (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Quoted Non-Trade Investments: Investment in Equity Instruments - 2,080 Equity shares of I.D.B.I.Ltd of Rs 10 each fully paid up 1.50 1.56 1.51 In Mutual Funds - 1,30,597 units of ICICI Prudential Infrastructure fund - - 15.53 - 1,25,646 units of L&T Oppurtunities Fund - - 19.22 - 23,286 units of UTI Master Growth Unit Scheme - - 6.62 1.50 1.56 42.88 Unquoted Non-Trade Investments: Investment in Equity Instruments Investment In Others - Kerala Enviro Infrastructure Ltd 0.79 0.79 0.72 (10,000 Equity Shares Of Rs 10 Each Fully Paid Up) - Cochin Waste 2 Energy P Ltd - - - (30,000 Equity Shares Of Rs 10 Each Fully Paid Up) - - - 0.79 0.79 0.72 NOTE 7B -Loans (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Unsecured considered good - Security Deposits - - 111.26 Unsecured Considered Doubtful - Security Deposits 24.60 24.54 8.16 24.60 24.54 119.42 - Provision for doubtful deposits (24.54) (24.54) (8.16) 0.06 - 111.26 NOTE 8 : Other Non Current Assets (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Unsecured,considered good - Capital Advances - - 4.31 Unsecured,considered doubtful - Capital Advances 83.12 83.12 83.12 less : provision for doubtful advance (83.12) (83.12) (83.12) - - 4.31

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NOTE 9 : Inventories (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 At lower of cost and net realisable value - Raw Material - - 175.28 - Packing material - - - work-in-progress - - 15.16 - Finished goods - 26.92 308.64 - Stores, spares & fuels 63.79 386.25 - Renewable energy certificate - 0.40 1.03 - 91.11 886.36

* Inventory includes : (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 In transit - Raw materials - - 47.73 - - 47.73 Mode of valuation: (i) Inventory of raw materials and consumables are valued at cost or net realizable value, whichever is lower, under FIFO Method.

Finished Goods are valued at cost or net realizable value whichever is lower. Cost for the purposes of valuation of finished goods includes cost of material, labour and other direct expenses.

NOTE 10: Current Financial Assets NOTE 10A :Trade Receivables (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Secured - More than six months from the date they became due - - - Unsecured - Considered Good (i) Exceeding Six Months From They become Due 179.15 148.62 516.44 (ii) Others - 185.76 1,147.90 - Considered Doubtful 721.04 783.00 235.41 Provision for doubtful debts (721.04) (783.00) (235.41) 179.15 334.38 1,664.34

NOTE 10B :Cash and cash equivalents (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Balance with Banks - In Current Accounts 22.62 4.58 13.97 - In Deposit Accounts 39.05 80.00 400.84 Cash in Hand 1.41 0.08 1.96 63.07 84.66 416.77

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z * Details of deposit account (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Bank of India - - 79.48 Margin money against bank guarantee 38.00 - - Federal Bank Ltd 1.05 68.11 217.27 Industrial Development Bank of India - 11.89 104.09 39.05 80.00 400.84

NOTE 10C : Short term Loans (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Security deposit - Unsecured considered good 27.60 27.60 29.70 Other Advance 5.00 5.00 5.00 provision for doubtful deposits (27.60) (27.60) (18.75) 5.00 5.00 15.95

NOTE 11 : Other Current Assets (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Advances income tax 20.93 311.40 326.07 Cenvat Credit - 12.37 99.78 Earmarked balance with bank 6.85 10.90 10.95 Interest accrued on deposits 2.02 1.02 9.16 other receivable 295.49 13.33 141.94 325.29 349.02 587.90 NOTE 12 :Equity share capital

A. Authorised (₹ and Nos in Lakh) Equity shares Preference shares Particulars Shares Amount Shares Amount As at April 2016 250.00 2,500.00 250.00 2,500.00 - Increase during the year - - As at 31 March 2017 250.00 2,500.00 250.00 2,500.00 - Increase during the year - - As at 31 March 2018 250.00 2,500.00 250.00 2,500.00

B. Issued, Subscribed & fully Paid Up As at March 31, 2018 As at March 31, 2017 As at March 31, 2016 Particulars No. of shares Amount No. of shares Amount No. of shares Amount At the beginning of 164.36 1,643.62 164.36 1,643.62 164.36 1,643.62 Issued during the period 8.60 86.00 - - - - Outstanding at the end of the 172.96 1,729.62 164.36 1,643.62 164.36 1,643.62

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NOTE 13 :Other equity (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Capital Reserve 36.68 36.68 36.68 General Reserve 533.00 533.00 533.00 Retained earnings (6,901.93) (6,133.70) (2,450.04) Securities premium 1,675.84 1,667.24 1,667.24 Money received against share warrants 235.40 - - Other comperhensive income - Actuarial gain/(loss) on defined benefit obligation (8.67) (9.36) - - Equity instrunment through other comperhensive income (2.06) (2.00) (30.76) (4,431.74) (3,908.14) (243.88) NOTE 14 : Analysis of items of other comprehensive income(OCI),net of tax Defined benefit Eqity Particulars plans instrunment through OCI As at 1st april 2016 - (30.76) Remeasurements (9.36) - Remeasurements utilized during the year 28.76 As at 31st march 2017 (9.36) (2.00) Remeasurements 0.69 (0.06) Remeasurements utilized during the year - - As at 31st march 2018 (8.67) (2.06)

i. Profit (loss) attributable to equity shareholders (basic and diluted) (₹ in Lakh) For period endedFor period ended Particulars March 31, 2018 March 31, 2017 Profit (loss) for the year (767.88) (3,683.23) less: Cumulative preference dividend not provided 135.40 135.40 Profit (loss) for the year, attributable to the equity holders (903.28) (3,818.63)

ii. Weighted average number of equity shares (Basic EPS) For period endedFor period ended Particulars March 31, 2018 March 31, 2017 Opening Balance 164.36 164.36 Effect of fresh issue of shares 0.07 - Weighted average number of equity shares for the year 164.43 164.36 Earning Per Share (EPS) - (Rs.) (5.49) (23.23)

iii. Weighted average number of equity shares (Diluted EPS) For period endedFor period ended Particulars March 31, 2018 March 31, 2017 Opening Balance 164.36 164.36 Effect of fresh issue of shares 0.07 - Effect of fresh issue of shares warrants 1.93 Weighted average number of equity shares for the year 166.37 164.36 Earning Per Share (EPS) - (Rs.) (5.43) (23.23)

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NOTE 16B: Current Borrowings As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Secured Loans from Banks Cash Credit 711.68 1,326.48 1,521.55 Short Term loan Sub-Total 711.68 1,326.48 1,521.55 Unsecured Loans Buyers credit facility - 13.16 723.26 Intercorporate Loan 712.00 - - Related parties 835.84 2,051.38 25.30 Sub-Total 1,547.84 2,064.54 748.56

Total 2,259.52 3,391.02 2,270.11 The Secured loan represents cash credit facility from banks creating 1st charge on entire current assets and second charge on entire fixed assets of the company.

* Secured Term Loans (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016

* Preference share (i) The Company has only one class of Preference Shares (non-convertible cumulative redeemable ) having a face value of Rs.10/- (ii) Preference shares carries a dividend at the rate of 11.25% (iii) The company shall redeem the preference share at par in 4 annual installment of Rs. 2.5 crore each. (iv) Details of shares held by each shareholder holding more than 5% shares: Name As at 31-03-2018 As at 31-03-2017 As at 01-04-2016 No of Shares % of holding No of Shares % of holding No of Shares % of holding Kerala State Industrial 60.00 60.00% 100.00 100.00% 100.00 100.00% Development S.Rajkumar 40.00 40.00% - 0.00% - 0.00%

Discription Repayment term Limit sanctioned - Industrial Development Bank of India Ltd On demand 30,000,000 - Federal Bank Ltd On demand 92,500,000 - Bank of India On demand 30,000,000 116

(i) Buyer,s credit availed by bank and loan from related parties are repayable on demand. (ii) There is no continuing default/default as on the date of balance sheet in repayment of loans and interest. NOTE 17 :Provisions (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Non-Current Provisions Provision for Employee benefits - Gratuity 8.43 8.06 65.78 8.43 8.06 65.78 Current Provisions Provision for Employee Benefits - Leave encashment - 1.54 4.78 Income tax Provision 72.58 61.43 77.13 72.58 62.97 81.91

1 The Provisions for Gratuity and Leave Encashment are made based on the actuarial valuation on 31.03.2018. 2 The laibility for Gratuity has been calculated on the basis of current ceiling of ₹10 lakh. The proposed enhancement of ceiling to ₹ 20 lakh has not been considered as the related amendment in The Payment of Gratutiy Act is yet to be notified. 3 Acturial valuation of gratuity is presently based on the retirement age of 55 years. The Union has filed a case before Kerala High Court for increasing the retirement age to 58. Impact on provision for gratuity, if the case is decided against the Company,has 4 Since the valuation is done by a professional actuary, the assumprions taken is considered reliable and hence sensitivity analysis Reconciliation of the net defined benefit liability TYPE OF PLAN Particulars Gratuity Leave plan As at 1 April 2016 63.75 6.81 Expected return on plan assets - - Interest Cost 4.48 0.51 Current service cost 0.49 1.05 Actuarial loss/(gain) on obligation 16.19 (6.83) Employer contribution to plan assets - - Net effect of benefit payments (76.85) - As at 31 March 2017 8.06 1.54 Expected return on plan assets - - Interest Cost 0.61 - Current service cost 0.46 - Actuarial loss/(gain) on obligation (0.69) - Employer contribution to plan assets - - Net effect of benefit payments - - As at 31 March 2018 8.44 - Expense recognised in profit or loss TYPE OF PLAN Particulars Gratuity Leave plan For the period ended 31 March 2017 Expected return on plan assets - - Interest Cost 4.48 0.51 Current service cost 0.49 1.04 Actuarial loss/(gain) on obligation - Claims received w.r.t previous years - - Total amount recognised in profit or loss 4.97 1.55 For the period ended 31 March 2018 Expected return on plan assets - - Interest Cost 0.61 - Current service cost 0.46 - Actuarial loss/(gain) on obligation - - Employer contribution to plan assets recognised in P/L - - Total amount recognised in profit or loss 1.07 - 117

Remeasurements recognized in other comprehensive income

TYPE OF PLAN Particulars Gratuity Leave plan 31-03-18 31-03-17 31-03-18 31-03-17 Actuarial loss/(gain) on obligation (68,753.00) 16.19 - (6.83) Balance as at the end of the year (0.69) 16.19 - (6.83)

Significant Estimates- The Significant actuarial valuation applicable for the plans are as below: Particulars 31-03-18 31-03-17 Indian Assured Lives Mortality (2006- Indian Assured Lives Mortality (1994- Mortality table 08) 96) Ultimate Discount Rate 7.54% 7.00% Salary escalation rate 5.00% 5.00%p.a Expected rate of return on plan assets Not Applicable Not Applicable

NOTE 18 :Deferred tax liabilities (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Deferred Tax Liabilities - Property,Plant & Equipment 152.69 436.61 1,112.21 Deferred Tax Asset - Provision for unrecognised expense 32.39 32.43 119.60 - Provision for Production Incentive 19.70 20.17 21.81 - Provision for Doubtful Debts/Claims 72.74 72.75 72.74 Net Deferred Tax Liabilities 27.86 311.26 898.06

* Movement in deferred tax liabilities Provision for Provision for Provision for Particulars Property,Plant & unrecognised Production Doubtful Equipment expense Incentive Debts/Claims At 1 April 2016 1,112.21 119.60 21.81 72.74 Charged/(credited) -to profit or loss (675.60) (87.17) (1.64) - -to other comprehensive income - - - - At 31 March 2017 436.61 32.43 20.17 72.74 Charged/(credited) -to profit or loss (283.92) - (0.47) - -to other comprehensive income At 31 March 2018 152.69 32.39 19.70 72.74

NOTE 19 : Other non•current liabilities (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Security deposits 1.43 1.43 1.43 1.43 1.43 1.43

NOTE 20 :Trade Payables (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Payable to Micro Small & Medium Enterprises 0.65 0.65 0.76 Other Trade Payables - Supplies 327.66 428.35 1,721.85 - Stores & Spares 52.04 66.83 87.55 380.34 495.83 1,810.16 Disclosure under Micro, Small and Medium Enterprises Development Act: (i) The above balances are subject to confirmation from the respective parties (ii) Amount due to Micro, Small and Medium enterprises included under Trade payables is ₹ NIL (Previous year ₹ 0.65 lakh). This amount is identified by the Management and relied upon by the Auditors. (iii) Interest of Rs 0.20 lakhs had become payable either in the current year or in the previous year under Section 16 of the Micro, Small and Medium Enterprises Development Act, 2006 or under any contractual obligation.

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NOTE 21 : Other current financial liabilities (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Current maturities of long term debts - Federal Bank Ltd - 30.00 18.00 - SBT panampilly nagar - 106.06 90.96 - Punjab National Bank - 35.00 41.70 - Vehicle loan Axis Bank - - 1.33 - Vehicle loan Axis Bank 0.33 1.74 1.93 Dividend payable 6.85 10.95 10.95 7.18 183.75 164.87

NOTE 22 : Other Current Liabilities (₹ in Lakh) As at As at As at Particulars March 31, 2018 March 31, 2017 April 1, 2016 Interest Accrued and due - Interest on buyers credit - - 2.40 - Interest on secured Loan - 16.80 - Other liabilities - Salaries and Other Benefits 225.51 127.11 62.05 - Statutory Dues Payable 239.28 79.52 167.56 - Advance for scrap Asset 42.76 - - - Other Payables 48.36 42.69 521.55 555.91 266.12 753.56 NOTE 23 :Sale of Products (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 (i) Sale of products: - own products 26.89 2,289.26 add: excise duty 0.36 111.41 (ii) Other operating income - Traded products - 374.85 - Scrap product 35.88 39.34 - Process waste income 1.13 - Sales of renewable energy certificate 99.67 77.73 162.79 2,893.72 NOTE 24 : Other Income (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 (i) Interest income: - On deposits with banks [Tax Deducted at Source Rs 0.41 Lakhs (Previous year Rs2.38 Lakhs)] 4.26 23.88 - On Advances - - (ii) Dividend income from Long-term investment - (iii) Sale Of Scrapped Fixed Assets 965.00 - (iv) Loan and interest on loan forfeited account - (v) Other non-operating income 25.50 90.05 994.76 113.93

NOTE 25 : Cost of Materials Consumed (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Raw materials - 1,692.63 packing materials - 34.18 - 1,726.81

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Stock as on 31st March Finished Goods - 26.92 Work in Process - - Total Closing Balance - 26.92

Changes in Inventory 26.92 296.88

NOTE 28 : Finance Cost (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Interest Cost on Financial liabilities carried at amortised cost - Interest expense 189.54 451.56 - Other borrowing cost - 75.55 - Exchange fluctuation - 26.82 - Loss on fair valuation of preference shares 24.43 16.79 213.97 570.71

NOTE 29 : Depreciation and ammortisation expenses (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Depreciation Property,Plant & Equipment 73.07 138.48 Ammortisation of intangible assets - - 73.07 138.48

NOTE 30 : Other Expenses (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Payment to auditor 2.23 3.01 Stores and Spares Consumed - 271.40 Power and fuel 6.09 426.29 Rent 4.86 39.43 Repairs and maintenance -Plant & Machinery - 34.85 -Buildings - 18.22 -Others 2.32 Insurance charges 5.43 16.80 Rates and Taxes 35.79 12.51 Discount 9.65 27.85 Stock Written Off - - Provision for doubtful debt - 531.17 Provision for advance - 82.95 Freight outwards 0.39 45.15 Miscellaneous expenses 120 64.44 264.49 131.19 1,774.12

NOTE 30A : Payment to auditor As at As at Particulars March 31, 2018 March 31, 2017 Statutory Audit Fee 0.89 0.89 Tax Audit Fee 0.25 Auditors Out of pocket Expense 0.30 0.29 Fee for other services 0.75 0.30 Audit fee for certfication 0.04 1.53 2.23 3.01 NOTE 30B : Stores and Spares Consumed As at 31-3-2018 As at 31-3-2017 Particulars ₹ ( In lakhs) % ₹ ( In lakhs) % Indigenous - 271.40 100% Imported - - 0.00% - 0.00% 271.40 100.00% NOTE 31 : Exceptional Items [expense / (income)] (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Retrenchment Compensation 98.82 Loss on sale of asset held for sale 2,100.55 Mat Credit Expense 300.38 Profit on sale of land (915.25) 1,584.50 -

NOTE 32 : Tax Expense (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Tax adjustments for previous year 11.05 - Deferred Tax (283.44) (586.40) (272.39) (586.40)

Income tax recognized in other income For the year ended 31/03/2018 For the year ended 31/03/2017 Particulars Tax (expense) Tax (expense) Before tax benefit Net of tax Before tax benefit Net of tax Remeasuremen t of defined benefit liability 0.69 - 0.69 (9.36) - (9.36) Remeasuremen t of Equity instrunment through OCI (0.06) - (0.06) 28.76 - 28.76

Reconciliation of effective tax rate - A reconciliation of the income tax expenses to the amount computed by applying the statutory income tax rate to the profit before income taxes is summarized below: (₹ in Lakh) For the year For the year Particulars ended ended 31/03/2018 31/03/2017 Profit from continuing operations before income tax expense (1,039.64) (4,250.23) Tax at the Indian Tax Rate of 30.9% (321.25) (1,313.32) Permanent disallowances - - Permanent allowances - - Temporary differences (283.44) (586.40) Tax in respect of earlier years 11.05 - Tax losses for which no deferred tax was recognised 321.25 1,313.32 Total income tax expense/(credit) (272.39) (586.40) Effective tax rate 26.20% 13.80% - Tax computation for 2017-18 was not finalized during the time of preparation. The above reconciliation is on the assumption that there won't any allowances or disallowances other than the ones taken for deferred tax computation.

NOTEThe 34 management: Fair Value Hierarchyhas assessed that its financial assets and liabilities like cash and cash equivalents, trade receivables, trade payables, cash credits, buyers credit and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments. The following methods and assumptions were used to estimate the fair values for the given below financial assets. Quoted Equity Instrunment and Mutual Funds: The fair values of the unquoted equity shares measured using quoted prices. This includes listed equity instruments and mutual funds Unquoted Equity Shares of Other Companies: The fair values of the unquoted equity shares have been estimated using NAV model. Preference Shares The value of the preference shares are based on the leding rate avaliable

31.03.2018 31.03.2017 01.04.2016 Particulars Significant observable inputs Significant observable inputs Significant observable inputs Level 1 Level 3 Level 1 Level 3 Level 1 Level 3 Financial Assets Investment in Quoted instrunments I.D.B.I.Ltd 1.50 1.56 1.51 ICICI Prudential Infrastructure - - 15.53 L&T Oppurtunities Fund - - 19.22 UTI Master Growth - - 6.62 Investment in Unquoted instrunments Kerala Enviro Infrastructure Limited 0.79 0.79 0.72 Financial Liabilities Preference shares 1,090.82 1,066.39 1,049.60

Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments, traded bonds and mutual funds that have quoted price. The fair value of all equity instruments (including bonds) which are traded in the stock Theexchangesfair value is valuedof financial using theinstruments closing pricethat as atare thenot reportingtraded period.in an Theactive mutualmarket funds(for areexample, valued usingtraded the bonds,closing NAV.over-the-counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in Level 2. If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3. This is the case for unlisted equity securities, contingent consideration and indemnification121 asset included in Level 3.

NOTE 35 : Contingent liabilities and Commitments (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 Unexpired Contracts for Capital Expenditure 260.61 260.61 Amount of Income tax liabilities disputed in appeal 22.18 38.21 Guarantee given on behalf of the Company 38.00 94.00 Excise duty disputed under appeal 350.79 350.79 Claim towards water charge raised by Kerala Water Authority 78.42 78.42 Customs duty liability under EPCG claim 58.79 58.79 Arrears of non - convertible cumulative preference dividend 537.70 402.30 1,346.49 1,283.12

NOTE 36 : Additional Information

I Information on Imports, Exports & Foreign Currency / Exch. Transactions. (₹ in Lakh) As at As at Particulars March 31, 2018 March 31, 2017 a) Value of Imports on CIF Basis i) Raw Materials & Consumables NIL 989.80 ii) Components and Spare Parts NIL NIL iii) Capital Goods NIL NIL NIL 989.80 b) Other Expenditure in Foreign Currencies (on cash basis) i) Expenses on Foreign travel NIL NIL ii) Books, Periodicals, & Subscriptions NIL NIL iii) Expenses towards Technical Services NIL NIL NIL NIL

c) Value of Exports on FOB Basis NIL NIL

II Details of Provisions Pursuant to Ind AS 37 – Provisions, Contingent Liabilities and Contingent Assets Sundry Debtors Income tax Gratuity & Leave Capital Deposits Particulars encashment Advances As at 1st april 2016 235.41 75.66 70.56 83.00 28.67 Provision made during the year 547.59 - (60.96) 4.34 23.47 Provision utilized during the year - (15.00) - - - As at 31st march 2017 783.00 60.66 9.60 87.34 52.14 Provision made during the year - 11.05 - - - Provision utilized during the year (61.96) - (1.17) - - As at 31st march 2018 721.04 71.71 8.43 87.34 52.14

For KPR & Co For and on behalf of the Board Chartered Accountants FRN: 05326S Sd/- Sd/- Sd/- R.Ponnambalam S.Rajkumar, Deepa Praveen, ACA Company Secretary Vice Chairman & Managing Director M. No.232410 Partner Sd/- Sd/- Cochin -16 V.N.Sridharan N. Subramanian 13.06.2018 Chief Financial Officer Director

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III Details in respect of related parties pursuant to IND AS 24 Name of Related party Nature of Relationship Details of Transactions Amount (Rs in Lakhs) Nature of Transactions 2017-18 2016-17 Managerial Remuneration - 8.85 Unsecured Loan (246.37) 931.10 Rent - 7.40 Key Management Personnel(Vice 1 Mr S Raj Kumar Chairman & Managing Director) Issue Of Share Capital including Share Premium 94.60 -

Issue of Share Warrant 235.40 -

2 MrsRajeeRajkumar Unsecured Loan 13.58 - Sitting Fees 0.10 -

3 Mr Vignesh Rajkumar No transaction - -

4 Mr Visakh Rajkumar No transaction - - 5 Mrs E Kamalam Sitting Fees - 0.10 Relative of Key Management Personnel Sitting Fees 0.20 0.50 6 Mr. S. Subramaniam Sales of Fixed Asset - 8.00 Rent - 2.08 7 Mr. A Ganesh Rent - 2.76 Unsecured Loan - 208.75 8 Mr. S Giridhar Sitting Fees - 0.90 Remuneration and Allowances - 8.00 Key Management Personnel (Executive Unsecured Loan (2.73) 49.83 9 Mr A.Padmanabhan Director) Sale of fixed asset - 3.00 Rent - 0.24 Key Management Personnel (Director 10 VVM Rao Operations) Remuneration and Allowances - 8.39

Sale of Goods 31.34 33.37 13 Aditya Papers Enterprises over which any person SreeSakthi mentioned in 1 to 6 above is able to 14 Civil work - 18.67 Constructions and exercise significant influence Infrastructure (P) Ltd Unsecured Loan (1.50) 116.85 Maharaja Continental 15 Reimbursement of expenses - 11.26 Trades Ltd Sales Commission - 30.31 Purchase of Raw Material - 400.85 Reimbursement of expenses - 11.50 16 Sree Giri Packagings Advance given 11.20 - Sale of Finished Goods 6.99 11.00 Very Same Industrial Sale of Goods - 4.66 17 Aids Ltd Purchase of Raw Material - 191.94 Sree Kashyap Surya 18 Energy Equipments No transaction - - Pvt Ltd Unsecured Loan 62.05 - 19 Visakh Homes Advance for Scrap Sale 14.20 - Note: Shri Kailash Logistics Limited was a related party as per Ind AS 24, till 30.12.2016 123

SREE SAKTHI PAPER MILLS LIMITED AND ITS SUBSIDIARIES CIN : L93000KL1991PLC006207

Notes forming part of the Financial Statements

NOTE 36 : Explanation to transition to Ind AS As stated in Note 2 (a), these are the Company’s first financial statements prepared in accordance with Ind AS. For the year ended 31 March 2016, the Company had prepared its financial statements in accordance with Companies (Accounting Standards) Rules, 2006, notified under Section 133 of the Act and other relevant provisions of the Act (‘previous GAAP’). The accounting policies set out in Note 3 have been applied in preparing these financial statements for the year ended 31 March 2018 including the comparative information for the year ended 31 March 2017 and the opening Ind AS balance sheet on the date of transition i.e. 1 April 2016. In preparing its Ind AS balance sheet as at 1 April 2016 and in presenting the comparative information for the year ended 31 March 2017, the Company has adjusted amounts reported previously in financial statements prepared in accordance with previous GAAP. This note explains the principal adjustments made by the Company in restating its financial statements prepared in accordance with previous GAAP, and how the transition from previous GAAP to Ind AS has affected the Company’s financial position, financial performance and cash flows. Optional exemptions availed and mandatory exceptions: In preparing these financial statements, the Company has applied the below mentioned optional exemptions and mandatory exceptions. A Optional exemptions availed 1 Property plant and equipment, intangible assets and investment properties As per Ind AS 101 an entity may elect to: i. measure an item of property, plant and equipment at the date of transition at its fair value and use that fair value as its deemed cost at that date ii. use a previous GAAP revaluation of an item of property, plant and equipment at or before the date of transition as deemed cost at the date of the revaluation, provided the revaluation was, at the date of the revaluation, broadly comparable to: a. fair value; b. or cost or depreciated cost under Ind AS adjusted to reflect, for example, changes in a general or specific price The elections under (i) and (ii) above are also available for intangible assets that meets the recognition criteria in Ind AS 38, Intangible Assets, (including reliable measurement of original cost); and criteria in Ind AS 38 for revaluation (including the existence of an active market). iii. use carrying values of property, plant and equipment, intangible assets and investment properties as on the date of transition to Ind AS (which are measured in accordance with previous GAAP and after making adjustments relating to decommissioning liabilities prescribed under Ind AS 101). As permitted by Ind AS 101, the Company has elected to continue with the carrying values under previous GAAP for all the property, plant and equipment. The same election has been made in respect of intangible assets and investment property also.

A Mandatory exceptions 1 Estimates As per Ind AS 101, an entity’s estimates in accordance with Ind AS at the date of transition to Ind AS at the end of the comparative period presented in the entity’s first Ind AS financial statements, as the case may be, should be consistent with estimates made for the same date in accordance with the previous GAAP unless there is objective evidence that those estimates were in error. However, the estimates should be adjusted to reflect any differences in accounting policies. As per Ind AS 101, where application of Ind AS requires an entity to make certain estimates that were not required under previous GAAP, those estimates should be made to reflect conditions that existed at the date of transition (for preparing opening Ind AS balance sheet) or at the end of the comparative period (for presenting comparative information as per Ind AS).

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Reconciliation of Equity (₹ in Lakh) As at April 1, 2016 Particulars Previous GAAP Adjustments Ind AS I. Assets 1 Non-current assets Property,Plant & Equipment 5,502.69 - 5,502.69 Capital work-in progress 22.92 - 22.92 Goodwill Other Intagible Assets 0.16 - 0.16 Intagible Assets under development Financial Assets Investments 52.88 (9.28) 43.60 Trade receivables Loans 115.57 (4.31) 111.26 Deferred tax assets (net) Other non•current assets - 4.31 4.31 2 Current Assets Inventories 998.51 (112.15) 886.36 Financial Assets Investments Trade receivables 1,664.34 - 1,664.34 Cash and cash equivalents 427.72 (10.95) 416.77 Bank balances other than (iii) above Loans 576.74 (560.79) 15.95 Others (to be specified) Tax Assets (Net) - - - Other current assets 16.16 571.74 587.90 Asset held for sale - 112.16 112.16 TOTAL 9,377.69 (9.27) 9,368.42

II. Equity & Liabilities 1 Equity Equity share capital 2,643.62 (1,000.00) 1,643.62 Other equity (185.00) (58.88) (243.88) Minority interest 16.28 - 16.28 2 Liabilities Non-Current Liabilities Financial Liabilities Borrowings 856.91 1,049.60 1,906.51 Trade Payables Other financial liabilities Provisions 65.78 - 65.78 Deferred tax liabilities (Net) 898.06 - 898.06 Other non•current liabilities 1.43 - 1.43 3 Current Liabilities Financial Liabilities Borrowings 2,270.11 - 2,270.11 Trade payables 1,810.16 - 1,810.16 Other financial liabilities - 164.87 164.87 Other Current Liabilities 918.43 (164.87) 753.56 Provisions 81.91 - 81.91 Current Tax Liabilities TOTAL 9,377.69 (9.27) 9,368.42

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(₹ in Lakh) As at 31 March, 2017 Particulars Previous GAAP Adjustments Ind AS I. Assets 1 Non-current assets Property,Plant & Equipment 965.82 0.00 965.82 Capital work-in progress - - - Goodwill Other Intagible Assets 0.16 - 0.16 Intagible Assets under development Financial Assets Investments 1.35 1.00 2.35 Trade receivables Loans - - - Deferred tax assets (net) Other non•current assets - - - 2 Current Assets Inventories 2,501.47 (2,410.36) 91.11 Financial Assets Investments Trade receivables 334.38 - 334.38 Cash and cash equivalents 95.56 (10.90) 84.66 Bank balances other than (iii) above Loans 342.10 (337.10) 5.00 Others (to be specified) Tax Assets (Net) - - - Other current assets 1.02 348.00 349.02 Asset held for sale - 2,410.36 2,410.36 TOTAL 4,241.86 1.00 4,242.86

II. Equity & Liabilities 1 Equity Equity share capital 2,643.62 (1,000.00) 1,643.62 Other equity (3,842.75) (65.39) (3,908.14) Minority interest 16.70 - 16.70 2 Liabilities Non-Current Liabilities Financial Liabilities Borrowings 703.85 1,066.39 1,770.24 Trade Payables Other financial liabilities Provisions 8.06 0.00 8.06 Deferred tax liabilities (Net) 311.26 0.00 311.26 Other non•current liabilities 1.43 0.00 1.43 3 Current Liabilities Financial Liabilities Borrowings 3,391.02 (0.00) 3,391.02 Trade payables 495.83 (0.00) 495.83 Other financial liabilities - 183.75 183.75 Other Current Liabilities 449.87 (183.75) 266.12 Provisions 62.97 (0.00) 62.97 Current Tax Liabilities TOTAL 4,241.86 1.00 4,242.86

* Previous GAAP figures have been reclassified to conform to IND AS presentation requirements for the purpose of the note.

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Reconciliation of total comprehensive income for the year ended 31-March -2016 (₹ in Lakh) For the year 31 March, 2017 Particulars Previous GAAP Adjustments Ind AS I Revenue From Operations 2,782.31 111.41 2,893.72 II Other income 113.93 - 113.93 III Total Income 2,896.24 111.41 3,007.65 IV Expenses Cost Of Material Consumed 1,726.81 0.00 1,726.81 Purchase of stock-in-Trade 221.64 - 221.64 Changes In Inventory 296.88 0.00 296.88 Excise Duty - 111.41 111.41 Employee Benefit Expenses 365.82 (9.36) 356.46 Finance costs 553.93 16.78 570.71 Depreciation and ammortisation expenses 138.48 (0.00) 138.48 Other Expenses 1,731.66 42.46 1,774.12 Total expenses(IV) 5,035.22 161.30 5,196.52 V Profit/(Loss) before, exceptional items and tax (I-II) (2,138.98) (49.89) (2,188.87) VI Exceptional Items [(expense) / income] VII Extraordinary items - Impairment 2,080.76 (2,080.76) - - Cost of waste removel by pollution control board 24.00 (24.00) - VII Profit/(Loss) before tax (4,243.74) 2,054.87 (2,188.87) VIII Tax expense Current income tax - - - Tax adjustments for previous year - - - Deffered Tax (586.80) 0.40 (586.40) (586.80) 0.40 (586.40) IX Profit/(Loss) for the period from continuing operations(VIII+IX) (3,656.94) 2,054.47 (1,602.47) X Other comprehensive income (i) Items that will not be reclassified to P/L - 19.40 19.40 (ii) Income tax relating to items that will not be reclassified to P/L - - - XI Total comprehensive income for the period(IX+X) (3,656.94) 2,073.87 (1,583.07)

* Previous GAAP figures have been reclassified to conform to IND AS presentation requirements for the purpose of the note. a) Re-measurement of defined benefit liability Under Ind AS, re-measurement of defined benefit liability are recognized under other comprehensive income. Under previous GAAP the Company recognized actuarial gains and losses in profit or loss. However, this has no impact on the total comprehensive income and total equity as on 1 April 2016 or as on 31 March 2017. b) Excise duty Under previous GAAP, revenue from sale of goods was presented net of the excise duty on sales. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. Excise duty is presented in the Statement of Profit and Loss as an expense. This has resulted in an increase in the revenue from operations and expenses for the year ended 31 March 2017. The total comprehensive income for the year ended and equity as at 31 March 2018 has remained unchanged. c) Other Comprehensive Income Under Ind AS, All items of income and expense recognized in a period should be included in profit and loss account, unless a standard requires or permits otherwise. Items of income and expenses that are not recognized in profit or loss but are shown in the profit or loss as “other comprehensive income” includes re‐measurements of define benefit plan. d) Prior period and Extra-ordinary assets The provisions of Ind-AS 8 requires that an entity will correct prior period errors retrospectively in the first set of the financial statements approved for issue after their discovery by restating the comparative amounts for the prior period(s) presented in which the error occurred. If the error occurred before the earliest prior period presented, it will restate the opening balance of assets, liabilities and equity for the earliest prior period presented. However, as per the provisions of section 131 of the Companies Act, 2013 if it appears to the Company that any change is required to the financial statements, they may prepare a revised financial statements only after obtaining the prior approval of the Tribunal. Given that the provisions of Ind-AS 8 which require revision of the figures of the previous financial years are not in sync with section 131 of the Companies Act, 2013, the Company is of the view that all such items of income and expenses relating to the prior periods in FY 2015-16 be adjusted in the financial statements for the FY 2015-16. On transition to Ind AS prior period items and extra-ordinary items are classified to the corresponding income/expenses in the year of recognition itself for recognition of prior period and extra-ordinary items are not permitted in Ind AS.However, this has no impact on the total comprehensive income and total equity as on 1 April 2016 or as on 31 March 2017. e) Preference shares Under previous GAAP, redeemable preference shares were classified as part of total equity. However, under Ind AS, financial instruments are classified as a liability or equity according to the substance of the contractual arrangement and not it's legal form. These preference shares do not contain any equity component and hence, have been classified in their entirely as a financial liability under Ind AS f) Fair value of investment In accordance with Ind AS, financial assets representing investment in equity shares have been fair valued. The Company has designated these investments at fair value through other comprehensive income as permitted by Ind AS 109. Under the previous GAAP, the application of the relevant accounting standard resulted in all these investments being carried at cost. g) Earmarked deposit Under previous GAAP, earmarked deposit with bank were classified as part of cash and cash equivalents. However, under Ind AS, earmarked deposit are grouped under other current assets.

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IV Additional information, as required to Consolidated Financial Statements to Schedule III to the Companies Act, 2013, of enterprises consolidated as Subsidiary / Associates / Joint Ventures for the financial year 2017-2018 Net assets, i.e., total Share of profit or loss Share in other Share of profit or loss assets minus comprehensive income Name of the entity total liabilities As % of Amount As % of Amount As % of Amount consolidated Amount consolidate consolidate consolidated other d net d other comprehensive assets profit or loss comprehensive income income

Sree Sakthi Paper Mills Limited 101% (2,702.03) 100% (767.43) 100% 0.63 100% (766.79) SUBSIDIARIES - Indian Jala Shaayi Alamparathodu Hydro 0% (2,702.03) 0% (0.10) 0.00% - 0% (0.10) Sree Kailas Palchuram Hydro Power Ltd -1% (2,702.03) 0% 0.23 0.00% - 0% 0.23 Sree Adi Sakthi Mukkuttathode Hydro Power Ltd 0% (2,702.03) 0% 0.53 0.00% - 0% 0.53 Non-controlling Interests in all subsidiaries -1% (2,702.03) 0% 0.35 0.00% 0% 0.35

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SREE SAKTHI PAPER MILLS LIMITED AND ITS SUBSIDIARIES CIN : L93000KL1991PLC006207 Consolidated Cash Flow for the period ended March 31, 2018 (₹ in Lakh) For period ended For period ended Particulars March 31, 2018 March 31, 2017 A CASH FLOW FROM OPERATING ACTIVITIES Total Comprehensive Income (767.26) (3,663.83) Adjustments for : Provision for Income-tax (271.52) (586.40) Depreciation and amortisation 161.08 2,241.70 Interest Income (4.26) (23.88) (Profit)/Loss on write off/ sale of Fixed Assets (915.25) (8.69) (Profit)/Loss on write off/ sale of investment - (4.98) Fair value change in investment through OCI (0.06) Mat credit written off 300.38 Finance Cost 213.97 570.71 Operating Profit before working capital changes (1,282.91) (1,475.37) Decrease(Increase) in Inventories 91.11 795.25 Decrease(Increase) in Trade receivable 155.23 1,329.96 Decrease(Increase) in Loans and Advances (0.06) 122.21 Decrease(Increase) in Other non current asset - 4.31 Decrease(Increase) in other current 1,769.62 238.88 assets & assets held for sale Increase(Decrease) in Trade payable (115.49) (1,314.33) Increase(Decrease) in Current Liabilities 287.64 (506.38) Increase(Decrease) in Other Non Current Liabilities 0.38 (57.72) Cash from Operations 905.52 (863.19) Income Tax paid (9.91) Cash from Operating before exceptional Items 895.61 (863.19) Exceptional Items - - Cash from Operating Activities 895.61 (863.19) B CASH FLOW FROM INVESTING ACTIVITIES Proceeds on Sale of Fixed Assets 950.00 28.05 Proceeds on Sale of investment - 46.35 Interest Income 4.26 23.88 Net Cash from Investing Activities 954.26 98.28 C CASH FLOW FROM FINANCING ACTIVITIES Net Proceeds from - Issue of shares 94.60 - - Issue of shares warrants 235.40 - - Borrowings (1,372.69) 1,198.59 Interest paid (213.97) (570.71) Net Cash from Financing Activities (1,256.65) 627.87 D TOTAL INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS DURING THE YEAR (A+B+C) 593.21 (137.04) Cash and cash equivalents at the beginning of the year (1,241.82) (1,104.78) Cash and cash equivalents at the end of the year (648.61) (1,241.82) Components of cash and cash equivalents Balance with Banks In Current Accounts 22.62 4.58 In Deposit Accounts 39.05 80.00 Cash in Hand 1.41 0.08 Cash Credit (711.68) (1,326.48) Total cash and cash equivalents (648.61) (1,241.82) For KPR & Co For and on behalf of the Board Chartered Accountants FRN: 05326S Sd/- Sd/- Sd/- R.Ponnambalam S.Rajkumar, Deepa Praveen, ACA Company Secretary Vice Chairman & Managing Director M. No.232410 Partner Sd/- Sd/- Cochin -16 V.N.Sridharan N. Subramanian 13.06.2018 Chief Financial Officer Director 129

SREE SAKTHI PAPER MILLS LTD.

CIN: L93000KL1991PLC006207, Regd Office: Sree Kailas, 57/2993

Paliam Road, Cochin – 682016

www.sreekailas.com, E-mail:[email protected] ATTENDANCE SLIP

TO BE HANDED OVER AT THE ENTRANCE OF THE MEETING HALL

NAME OF SHAREHOLDER (IN BLOCK LETTERS) :

MEMEBR’S FOLIO/ID NO. :

NAME OF THE PROXY (IN BLOCK LETTERS) :

(To be filled in if the proxy attends instead of the member)

No. of shares held …………………………………………………………………………………………………

I hereby record my presence at the 27th Annual General Meeting of the members of Sree Sakthi Paper Mills Limited held on 29th September, 2018 at 2.00 p.m. at Hotel Abad Plaza, M.G. Road, Ernakulam, Cochin – 35.

Members / Proxy Signature

Note: A member / proxy attending the meeting must complete this Attendance Slip and hand it over at the entrance.

------------

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SREE SAKTHI PAPER MILLS LTD. CIN: L93000KL1991PLC006207, Regd Office: Sree Kailas, 57/2993, Paliam Road, Cochin – 682016 www.sreekailas.com, E-mail:[email protected]

PROXY FORM [Pursuant to section 105(6) of the Companies Act, 2013 and rule 19(3) of the Companies (Management and Administration ) Rules, 2014]

Name of the Member (s): Registered Address: E-mail Id: Folio No. / Client Id: DP ID: I/ We, being a Member (s) of ………………………………shares of the above named company, hereby appoint 1. Name: 2. Name: Address: Address: Email Id: E-mail Id: Signature:…………………………………or failing Signature:…………………………………or failing 3. Name: Address: Email Id: Signature:…………………………………or failing As my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the 27th Annual General Meeting, to be held on Saturday, 29th September, 2018 at 2.00 p.m. at Hotel bad Plaza, M.G. Road, Cochin – 35 and at any adjournment thereof in respect of such resolutions as are indicated below: S.No Description of Resolution I/We assent to I/We dissent to the Resolution the Resolution (FOR) (AGAINST) 1 To receive, consider and adopt the audited financial statements (both standalone and consolidated financial statements) for the financial year ended 31st March, 2018 and the Report of the Board of Directors and Auditors thereon. 2 Re –appointment of of Mr. Subramoniam Sivathanupillai (DIN-01790968), Director who retires by rotation 3. Regularisation of Mrs. Rajee Rajkumar (DIN: 363280) as Director of the Company 4. Approval of Related Party Transaction 5. To change the name of the Company 6. Re-appointment Dr. S. Rajkumar (DIN: 01790870) as Managing Director 7. To appoint Mr Uliar Gururaja Bhat as Independent Director

Place: Affix Rupee 1/- Date: Revenue Stamp

Signature of shareholder

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If undelivered please return to SREE SAKTHI PAPER MILLS LTD. Regd.office: Sree Kailas, 57/2993, Paliam Road, Cochin- 682016