To,

The Members,

Narayani Steels Limited.

The Directors have pleasure in presenting their 23^rdAnnual Report on the business and operations of the Company and the accounts for the Financial Year ended 31^st March, 2018.

1. FINANCIAL SUMMARY OF THE COMPANY:

2. STATE OF COMPANY’S AFFAIRS UNDER CLAUSE (i) TO SUB-SECTION (3) OF SECTION 134 OF THE COMPANIES ACT, 2013:

a) FINANCIAL SUMMERIES

STANDALONE:

During the year under review, the Company has recorded anGross Income of Rs. 777.50Croresas compared to the previous year amount of Rs.784.00 Crores. The Expenditure incurred before depreciation and interest during the year was Rs. 19.80 Crores as against the amount of Rs.18.47 Crores during the previous year. The Depreciation and Tax provided during the year were Rs.0.69 Crores and Rs.1.17 Crores respectively as compared to the Depreciation and Tax provided for the previous year were Rs.0.54 Crores and Rs. 1.07 Crores respectively. Hence, the Company has earned a Net Profit of Rs. 2.05 Crores as compared to the previous year amount of Rs.2.09 Crores. During this year, the Net Profit decreased@ 2.09 % as compared to the previous year as slowdown market conditions during the year.

CONSOLIDATED:

During the year under review, the Company has recorded a Gross Income of Rs. 777.50 Croresas compared to the previous year amount of Rs. 784.00 Crores. The Expenditure incurred before depreciation and interest during the year was Rs. 19.80 Croresas against the amount of Rs.18.47Crores during the previous year. The Depreciation and Tax provided during the year were Rs.0.69 Crores and Rs.117.09 Crores respectively as compared to the Depreciation and Tax provided for the previous year were Rs.0.54 Crores Only and Rs.1.07 Crores respectively. Share of profit in association is Rs.0.20 Croresduring the year and Rs.0.14 Crores in previous year. Hence, the Company has earned a Net Profit of Rs. 2.25 Crores as compared to the previous year amount of Rs.2.24 Crores. During this year, the Net Profit increased @ .47%as compared to the previous year as the market activity regained its growth during the year.

(b) CHANGE IN THE NATURE OF BUSINESS, IF ANY:

There are no changes in the nature of business of the Company during the Financial Year 2017-18.

3. EXTRACT OF THE ANNUAL RETURN:

As required under Clause (a) to Sub-section (3) of Section 134 of the Companies Act, 2013, the extract of Annual Return in form MGT-9 as provided under Sub-section (3) of Section 92 of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, is enclosed in Annexure-2.

4. AUDITORS:

A) STATUTORY AUDITORS:

M/s. A C Bhuteria and Co., Chartered Accountants, Kolkata (FRN:303105E) appointed as Statutory Auditors to conduct Statutory Audit of Company.

B) COST AUDITORS.

M/s. A.S. Rao & Co.,Cost Accountants, Hyderabad, was appointed as Cost Auditors of the Company to conduct the audit of Cost Accounts maintained by the Company. The Company has received the Cost Audit Report from the Cost Auditor for the FY 2017-18.

C) SECRETARIAL AUDITORS:

The Board of Directors of the Company has appointed M/s. ASN Associates, Practicing Company Secretaries, to conduct Secretarial Audit for the Financial Year 2017-18. The Secretarial Audit Report for the Financial Year ended March 31, 2018 is annexed herewith to this Report. The Secretarial Audit Report contains qualification, reservation or adverse mark.

D) INTERNAL AUDITORS:

M/s. A. Ramachandra Rao & Co., Chartered Accountants (FRN: 02857S), Visakhapatnam-530013, Andhra Pradesh, India, be and are hereby appointed as Internal Auditors of the Company.

7. PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENT:

Hari Equipments Private Limited (Associate Company)

During the Financial Year 2017-18, its Associate Company i.e Hari Equipments Private Limited has gross turnover of Rs.167,14,61,158/- as compared to Rs.188,07,87,195/- in the previous Financial Year and its profit after tax in 2017-18 is R.54,43,012 as compare to Rs.39,94,152 in previous Financial Year.Details of Associate Company mentioned in (Annexure-3)

6. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW:

During the F.Y. 2017-18 the Board of Directors met for 24 (Twenty Four) times to discuss about the business and other important matters relating to the Company which forms part of this report. The details of which are given in Annexure-1. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

7. DIRECTORS RESPONSIBILITY STATEMENT:

In accordance with the provisions of Sub-section (5) of Section 134 of the Companies Act, 2013 and as required under Clause (c) to Sub-section (3) of Section 134 of the Companies Act, 2013 the Board hereby submits its Responsibility Statement:—

(a) in the preparation of the Annual Accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departures;

(b) the Directors had selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year and of the profit and loss of the Company for that period;

(c) the Directors had taken proper and sufficient care for the maintenance of adequate Accounting Records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) the Directors had prepared the Annual Accounts on a Going Concern basis;

(e) the Company being listed Company, Sub-clause (e) to Sub-section (5) of Section 134 of the Companies Act, 2013 pertaining to laying down Internal Financial Controls is applicable to the Company; and

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

8. COMPANY’S POLICY RELATING TO DIRECTOR’S APPOINTMENT, PAYMENT OF REMUNERATION INCLUDING DISCHARGE OF THEIR DUTIES AND OTHER MATTERS:

The Company is covered under Sub-section (1) of Section 178, therefore the Board on the recommendation of the Nomination & Remuneration Committee has devised and implemented a Nomination and Remuneration Policy for Director’s appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matters provided under Sub-section (3) of Section 178 and a summary of the same is disclosed in Annexure-8 as required under Clause (e) to Sub-section (3) of Section 134 of the Companies Act, 2013, .

9. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND COMPANY SECRETARY IN PRACTICE IN THEIR REPORTS UNDER CLAUSE (f) TO SUB-SECTION (3) OF SECTION 134 OF THE COMPANIES ACT, 2013:

As required under Clause (f) to Sub-section (3) of Section 134 of the Companies Act, 2013, the explanation or comments on qualifications, reservations, adverse marks or disclaimers made by the Auditors in their reports is disclosed in Annexure -5.

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

As required under Clause (g) to Sub-section (3) of Section 134 of the Companies Act, 2013, the Company has given Corporate Guarantee for the Credit Facilities taken by Hari Equipments Pvt. Ltd during the year.

Details of Guarantees and security provided to any other body corporate during the previous financial year as given below:

Company has provided one of its property at Visakhapatnam as security with the bank for credit facilities availed by Kedarnath Commotrade Pvt. Ltd

11. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SUBSECTION (1) OF SECTION 188 IN THE PRESCRIBED FORM:

As required under Clause (h) to Sub-section (3) of Section 134 of the Companies Act, 2013, the particulars of every Contract or 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 arm’s length transactions under third proviso thereto are disclosed in Form AOC-2 as Annexure-4.

12. THE AMOUNTS, IF ANY, WHICH IT PROPOSES TO CARRY TO ANY RESERVES UNDER CLAUSE (j) TO SUBSECTION (3) OF SECTION 134 OF COMPANIES ACT, 2013:

During the Financial Year 2017-18, the Company has not transferred any amount to its Reserves and surplus except the Profits earned during the year for both Standalone and consolidated financial Results.

13. THE AMOUNT, IF ANY, WHICH IT RECOMMENDS SHOULD BE PAID BY WAY OF DIVIDEND UNDER CLAUSE (k) TO SUB-SECTION (3) OF SECTION 134 OF COMPANIES ACT, 2013:

Your Directors have not recommended any dividend in view of the sluggish market conditions prevalent in the Steel Industry and to meet the Working Capital requirements for effective operations as per the plans conceived.

14. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT:

As required under Clause (L) to Sub-section (3) of Section 134, no material changes and commitments affecting the financial position of the Company occurred between the end of the Financial Year to which this Financial Statements relate on the date of this Report.

15. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO, IN SUCH MANNER AS MAY BE PRESCRIBED UNDER CLAUSE (m) TO SUB-SECTION (3) OF SECTION 134 OF COMPANIES ACT, 2013:

The particulars as prescribed under Clause (m) to Sub-section (3) of Section 134 of the Companies Act, 2013 read with Companies’ (Accounts) Rules, 2014 regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earnings/ Outgo is provided as under:

(a) Conservation of Energy:

(b) Technology Absorption:

(c) Foreign Exchange Earnings /Outgo:

16. STATEMENT INDICATING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY FOR THE COMPANY AS REQUIRED UNDER CLAUSE (n) TO SUB-SECTION (3) OF SECTION 134:

The Company has devised and implemented a Risk Management Policy and all the risks are discussed at the Senior Management Level at their Meetings periodically to ensure that the risk mitigation plans are well thought out and implemented and adverse impact of risks is avoided or kept within manageable proportions though the elements of risk threatening the Company’s existence are very minimal. This policy are mentioning in www.narayanitmt.com

17. DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIAL RESPONSIBILITY INITIATIVES TAKEN DURING THE YEAR UNDER CLAUSE (o) TO SUB-SECTION (3) OF SECTION 134 OF COMPANIES ACT, 2013:

The provisions of Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, are not applicable to the Company.

18. FORMAL ANNUAL EVALUATION:

Being a listed Public Limited Company having Paid-up Capital of less than Rupees Twenty Five Crores, the provisions of Clause (p) to Sub-section (3) of Section 134 of the Companies Act, 2013, relating to a statement on Formal Annual Evaluation of performance of the Board,its Committee and of Individual Directors has been made.

19. VIGIL MECHANISM POLICY:

Pursuant to the provisions of Sub-section (9) & (10) of Section 177 of the Companies Act, 2013, a Vigil Mechanism Policy for Directors and Employees to report genuine concerns has been established. The Company has also provided adequate safeguards against victimization of Employees and Directors who express their concerns.

The Vigil Mechanism Policy has been uploaded on the website of the Company at http:// www.narayanitmt. com/.

20. SECRETARIAL AUDIT REPORT:

The provisions relating to Secretarial Audit under Section 204 of the Companies Act, 2013 and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are applicable to the Company as the turnover exceeds Rs. 250,00,00,000/- and the same is enclosed as Annexure-5.

21. DEPOSITS:

The Company has neither accepted nor renewed any deposits during the year under review within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

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

There are no significant and material Orders passed by the Regulators or Courts or Tribunals impacting the Going Concern Status and Company’s operations in future.

23. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:

The Company has established an internal control over financial reporting criteria 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.

Also, as per the Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 issued by the Independent Auditors of the Company, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively.

24. THE BOARD AND KMP.

a) Change in the Composition of the Board of Directors& KMP:

No change has been occurred during the Financial Year 2017-18 except resignation of Mr. Kishan Lal Choudhary. Company Secretary Nisha Rathor resigned and in her place Mr. Arun Kumar Meher appointed as Company Secretary of the Company during the beginning of the Financial Year. Details of Senior Executive and KMP are shown in our website: www.narayanitmt.com

b) Details of composition of audit committee as per section 177(8) of the companies act,2013

The Audit Committee consists of the following persons.

25. PARTICULARS OF EMPLOYEES:

The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Employees of the Company is disclosed in Annexure-6.

26. DECLARATION GIVEN BY INDEPENDENT DIRECTORS:

The statement on Declaration to be given by Independent Directors under Sub-section (6) of Section 149 of Companies Act, 2013 and Companies Appointment and Qualification of Directors) Rules, 2014 as required under Clause (d) to Sub-section (3) of Section 134 of the Companies Act, 2013 is enclosed as Annexure-7.

27. INSURANCE:

All the assets of the Company wherever necessary and to the extent required have been adequately insured.

28. EMPLOYEE RELATIONS:

During the year, the Employee relations in the Company remained cordial and highly conducive to congenial working environment in all its establishments and further the Company has been in touch relating to recruitment of required personnel from time to time. Your Directors would like to place on record the dedication and commitment of all the Employees of your Company in achieving the good results.

29. A DISCLOSURE AS TO WHETHER MAINTENANCE OF COST RECORDS AS SPECIFIED BY THE CENTRAL GOVERNMENT UNDER SUB-SECTION (1) OF SECTION 148 OF THE COMPANIES ACT, 2013:

Maintenance of cost records as specified by the central government under sub-section (1) of section 148 of the companies act, 2013, is required by the company and accordingly such accounts and records are made and maintain.

30. INTERNAL COMPLAINTS COMMITTEE:

Company has complied with provision relating to the constitution of Internal Complaints Committee under sexual harassment of women at workplace (prevention, prohibition and redressal), Act, 2013

31. MANAGEMENT DISCUSSIONS AND ANALYSIS:

The Board has been continuing its efforts and taken the required steps in the area of Industry, structure and Development, Growth Strategy, Segment-wise Performance, Internal Control Systems and their adequacy, Analysis of Strengths, Weaknesses, Opportunities and Threats, Financial Performance with respect to Operational Performance, Material developments in human resources / industrial relations, Strict Compliances, Talent Management, Leadership Development, and Talent Retention, Learning and Development.

32. ACKNOWLEDGEMENTS:

Your Directors wish to place on record their appreciation of the whole-hearted assistance and co-operation received by the Company from Members, Customers, Dealers, Distributors, Bankers, Financial Institutions, Government & Other Agencies, Local Bodies, other Corporate Bodies and the Public and look forward to their support in coming years. They express their gratitude to all the Shareholders of the Company for the confidence reposed in the Management. Your Directors appreciate the sincere services rendered by the Employees at all levels. Thanks are also extended to our Professionals, Advisors, Well-wishers and Persons dealing with the Company. ***

For and on behalf of the Board of Directors of

Narayani Steels Limited

(Sunil Choudhary)

Managing Director

DIN:00289479

(Bivor Bagaria)

Director and Chief Financial Officer

DIN:06765822

Registered Office:

23A, N.S. Road, 7^th Floor,

Room - 31, Kolkata- 700 001,

West Bengal, India

Place: Visakhapatnam

Date: 31.08.2018