The Directors have pleasure in presenting the 25th Annual Report on the working of the Company together with the Audited Accounts of the Company for the year ended on 31^st March, 2018.

1. FINANCIAL PERFORMANCE:

The Company has adopted the Indian Accounting Standards ("IND AS") w.e.f. 1^st April, 2017 with a transition date of 1^st April, 2016. Accordingly, results for the year ended 31^st March, 2018 have been prepared in accordance with Ind AS prescribed under Section 133 of the Companies Act, 2013. Previous periods figures have been restated as per Ind AS to make them comparable. The summarized financial highlight is depicted below.

(Rs. in Lacs)

2. REVIEW OF OPERATIONS:

The revenue from operations for the financial year 2017-18 at Rs. 6763.29/- Lacs (net of excise duty) was higher by 4.63% over last year (Rs. 6464.23/- Lacs in financial year 2016-17- net of excise duty). Earnings before interest, tax, depreciation and amortisation (“EBITDA") was Rs. 1607.92/- Lacs over EBITDA of Rs. 1679.72/- Lacs in financial year 2016-17. Your Company has sustained its efforts to maintain profit for the year 2017-18. Profit after tax ("PAT") for the year was Rs. 700.06/- Lacs over the PAT of Rs. 700.93/- Lacs of financial year 2016-17.

3. DIVIDEND:

Based on Company's performance for the financial year 2017-18, the Board of Directors ("the Board") are pleased recommend for approval of the members a final dividend of Rs. 1.50 per share, being 15% (previous year Rs. 1.50 per shares) on the face value of Rs. 10 per share on 6,149,800 Equity Shares of the Company to be appropriated from the profits of the Company for the financial year 2017-18. The final dividend on equity shares, if approved by the members would involve a cash outflow of Rs. 111.21/- Lacs including dividend tax.

4. TRANSFER TO RESERVES:

The Company proposes to transfer Rs. 25.00/- Lacs to the general reserve.

5. PUBLIC DEPOSITS:

During the year under review, your Company has not accepted any public deposits within the meaning of Section 73 of the Companies Act, 2013 read with rules made thereunder.

6. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

During the year under review, the Company has not given any loan or provided guarantees or made any investments as prescribed under Section 186 of the Companies Act, 2013.

7. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with rule 8 of The Companies (Accounts) Rules, 2014, as amended from time to time is annexed herewith as Annexure A.

8. CORPORATE GOVERNANCE:

A separate report on Corporate Governance compliance as stipulated by SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of this Annual Report along with the required certificate from a Statutory Auditors regarding compliance of the conditions of Corporate Governance as stipulated. In compliance with Corporate Governance requirements, your Company has formulated and implemented a Code of Business Conduct and Ethics for all Board members and senior management personnel of the Company, who have affirmed the compliance thereto. A certificate of Chief Executive Officer and Chief Financial Officer of the Company in terms of Listing Regulations, inter alia, confirming the correctness of the financial statements and Cash flow statements is also annexed.

Information required to be disclosed under Clause IV of Part II, Section II of Schedule V is provided in separate section of Corporate Governance Report. No service contracts have been executed with any directors except Mr. Ambar Patel.

9. MANAGEMENT DISCUSSION & ANALYSIS REPORT:

A detailed report on Management Discussion and Analysis as required under Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is included as separate section forming part of this Report. Certain statement of the said report may be forward looking. Many factors may affect the actual results, which could be different from what the directors envisage in terms of performance and outlook.

10. LISTING OF SHARES:

The Equity Shares of the Company are listed on the BSE Limited (BSE) with scrip code No. 513709. The Company confirms that the annual listing fees to stock exchanges for the financial year 2018-19 have been paid.

11. DIRECTORS & KEY MANAGERIAL PERSONNEL:

(a) Retirement by Rotation

Mrs. Monica Kanuga (DIN: 06919996)

In accordance with the provisions of Companies Act, 2013 and Articles of Association of the Company, Mrs. Monica Kanuga (DIN: 06919996) is liable to retire by rotation at the ensuing Annual General Meeting of the Company and being eligible, offer herself for re-appointment. The Board recommends the appointment of Mrs. Monica Kanuga as Director of the Company retiring by rotation.

(b) Re-appointment of Mr. Ambar Patel (DIN: 00050042) as Managing Director

The term of office of Mr. Ambar Patel (DIN: 00050042) as Managing Director, of the Company expires on June 30, 2018. The Board of Directors on the recommendation of the Nomination and Remuneration Committee, at their respective meetings held on April 28, 2018, have accorded their approval to re-appoint Mr. Ambar Patel, as Managing Director of the Company, for a further period of three (3) years w.e.f. July 01, 2018, subject to the approval of Members of the Company at ensuing Annual General Meeting. His re-appointment and remuneration is in terms of Section 196, 197, 198 and 203 read with Part II Section II, of Schedule V of the Companies Act, 2013 and other applicable provisions of the Companies Act, 2013. The detailed terms and conditions including remuneration have been mentioned in the Notice convening 25^th Annual General Meeting. The Board recommends the appointment of Mr. Ambar Patel as Manager Director of the Company.

(c) Declaration by Independent Directors

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.

12. DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm that:

a) in the preparation of annual accounts, the applicable Accounting Standards have been followed along with proper explanation relating to material departures;

b) the accounting policies have been applied consistently and reasonable and prudent estimates have been made so as to give a true and fair view of the state of affairs of the Company at the end of the financial year 2017-2018 and the profit of the Company for that period;

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

d) the Annual Accounts have been prepared on a 'going concern basis';

e) the internal financial controls followed by the Company are adequate and has been operating effectively; and

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

13. MEETINGS OF THE BOARD:

The Board of Directors met 5 (Five) times during the year under review. The details of the Board Meetings and attendance of the Directors are provided in the Corporate Governance Report, which forms part of this Report.

14. COMMITTEES OF BOARD:

Details of various committees constituted by the Board of Directors as per the provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Companies Act, 2013 are given in the Corporate Governance Report which forms part of this report.

15. SUBSIDIARY COMPANIES / ASSOCIATE COMPANIES / JOINT VENTURE:

The Company has no subsidiary, Associate or Joint Venture within the meaning of Section 2(6) of Companies Act, 2013 ("ACT").

16. WHISTLE BLOWER / VIGIL MECHANISM:

The Company has adopted a whistle blower policy and has established the necessary vigil mechanism for employees and directors to report concerns about unethical behaviour. No person has been denied access to the Chairman of the Audit Committee. The details of said policy are available on the website of the Company at http://www.shilpgravures.com. During the year under review, there was no case of whistle blower. The provisions of this policy are in line with the provisions of Section 177(9) of the Companies Act, 2013 and as per the Regulation 22 read with Regulation 4(d) (iv) of SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015.

17. CORPORATE SOCIAL RESPONSIBILITY:

Shilp has been proactively carrying out CSR activities in alignment with the vision of the Company. Shilp, through its CSR initiatives, continuous to enhance value creation in the society and in the community in which it operates, through its services, conduct & initiatives, so as to promote sustained growth for the society and community, in fulfillment of its role as Socially Responsible Corporate, with environmental concern.

In compliance with requirements of Section 135 of the Companies Act, 2013, the Company has laid down a CSR Policy. The composition of the Committee, contents of CSR Policy and Report on CSR activities carried out towards supporting projects in eradication of hunger, promoting education, healthcare during the financial year ended 31^st March, 2018 in the format prescribed under Rule 9 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed herewith as Annexure B.

18. POLICY ON NOMINATION AND REMUNERATION:

The contents of Nomination and Remuneration Policy of the Company prepared in accordance with the provisions of Section 178 of the Companies Act, 2013 and Regulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are provided in the Corporate Governance Report. The Policy may be referred to at the Company's website at http://www.shilpgravures.com.

19. BOARD EVALUATION:

The Board adopted a formal mechanism for evaluating its performance as well as performance of individual Directors, including the Chairman of the Board in compliance with provisions of the Companies Act, 2013, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

20. EXTRACT OF THE ANNUAL RETURN:

The extract of Annual Return required under Section 134(3(a) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, in Form MGT - 9, is annexed herewith as Annexure C.

21. RELATED PARTY TRANSACTIONS:

All related party transactions entered into during the financial year were on arm's length basis and were in the ordinary course of business and in compliance with the applicable provisions of the Act and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Your Company had not entered into any transactions with related parties which could be considered material in terms of Section 188 of the Companies Act, 2013. Hence, there is no information to be provided as required under Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014. The Audit Committee reviews all related party transactions quarterly. The Policy on Related Party Transactions of the Company is available on the Company's website at http://www.shilpgravurs.com

22. INTERNAL FINANCIAL CONTROLS:

The Internal Financial Controls with reference to financial statements are adequate, and commensurate with the size, scale and complexity of its operation. The internal controls are tested for adequacy, efficiency and effectiveness through audits by internal auditors and the observations, corrective and preventive actions are reviewed by the management and Audit Committee of the Board of Directors. The internal auditor's team carries out extensive audits throughout the year across all locations and across all functional areas and submits its reports to the Audit Committee of the Board of Directors, which reviews and approves annual internal audit plan. Audit Committee periodically reviews the performance of internal audit function.

During the financial year under review, no material or serious observation has been received from the Internal Auditors of the Company for inadequacy or ineffectiveness of such controls.

23. INDIAN ACCOUNTING STANDARDS:

Your Company has adopted Indian Accounting Standards ('Ind AS') with effect from April 1, 2017 with a transition period of 1^st April, 2016 pursuant to Ministry of Corporate Affairs notification dated February 16, 2015, notifying the Companies (Indian Accounting Standards) Rules, 2015. The implementation of "IND AS" in 2017 will be a major change process and the Company is well positioned to ensure a smooth transition.

24. COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD AND GENERAL MEETINGS

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

25. TRANSFER OF UNCLAIMED EQUITY SHARES TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF) SUSPENSE ACCOUNT:

MCA vide Notification dated September 5, 2016, brought the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ('IEPF Rules'), w.e.f. September 7, 2016. Pursuant to the provisions of Section 124 and 125 of the Companies Act, 2013 and the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, all shares on which dividend has not been paid or claimed for seven (7) consecutive years or more, shall be transferred to an Investor Education and Protection Fund ('IEPF') suspense account (in the name of the Company) with one of the Depository Participants as may be identified by the IEPF Authority, within thirty (30) days of such shares becoming due to be transferred to the IEPF. Accordingly, in compliance with the provisions of said section and rules and the Company had initiated the process and issued individual notices/reminders to the 414 shareholders holding 51887 equity shares, who have not claimed their dividends for the last seven (7) consecutive years. Thereafter, said shares had been transferred to Investor Education and Protection Fund Suspense Account "(IEPF Suspense Account)". The Statement containing details of Name, Address, Folio No., Demat Account No. and No. of shares transferred to IEPF Suspense Account is made available on Company's website at http://www.shilpgravures.com.

26. EQUAL OPPORTUNITY EMPLOYER:

The Company has always provided a congenial atmosphere for work to all employees that is free from discrimination and harassment including sexual harassment. It has provided equal opportunities of employment to all without regard to their caste, religion, colour, marital status and sex. The Company has also framed a Policy on "Prevention of Sexual Harassment" at the workplace. There were no cases reported under the said Policy during the year.

27. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:

The information required under Section 197 of the Companies Act, 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in separate annexure forming part of this Report as Annexure-D.

28. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

There have been no material changes and commitments, if any, affecting the financial position of the Company, which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report.

29. AUDITORS:

(a) Statutory Auditors:

As per provisions of Section 139 of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014, the term of Deloitte Haskins & Sells (ICAI firm Registration Number 117365W), Chartered Accountants, Ahmedabad as the Statutory Auditors of the Company expires at the conclusion of the ensuing Annual General Meeting (AGM) of the Company.

The Board of Directors of the Company at its meeting held on February 03, 2018, on the recommendation of the Audit Committee, has made its recommendation for appointment of M/s. Shah & Shah Associates, Chartered Accountants, Ahmedabad (Firm Registration No.113742W) as the Statutory Auditors of the Company for a term of five consecutive years, from the conclusion of 25^th AGM of the Company till the conclusion of 30^th AGM (subject to ratification of their appointment at every AGM) for approval of shareholders of the Company. The Company has received a certificate that they satisfy the criteria provided under Section 141 of the Companies Act, 2013 and that the appointment, if made, shall be in accordance with the applicable provisions of the Companies Act, 2013 and rules framed thereunder.

The Report given by the Auditors on the financial statements of the Company is part of the Annual Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Report. The notes on the financial statement referred to in the Auditor's Report are self-explanatory and do not call for any further comments.

The Audit Committee and the Board of Directors wishes to place on record their deep appreciation for the professional services rendered by M/s. Deloitte Haskins & Sells, during their long association with the Company while maintaining the ethical standards and zenithal level of governance.

(b) Secretarial Auditors:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the rules made thereunder, your Company had appointed Mrs. Monica Kanuga, Practicing Company Secretary to undertake the Secretarial Audit of the Company. The Secretarial Audit Report for financial year 2017-18 is annexed which forms part of this report as Annexure-E. The remark of auditor will be adequately addressed.

(c) Internal Auditors:

The Board of Directors appointed M/s. KJP & Associates LLP, Chartered Accountants, as Internal Auditors of the Company for the F. Y. 2017-18.

30. INSURANCE:

All the insurable interests of the Company including Inventories, Buildings, Plant & Machinery and Liabilities under legislative enactments are adequately insured.

31. ACKNOWLEDMENTS:

The Company has maintained healthy, cordial and harmonious relations at all levels throughout the year. We thank our customers, vendors, investors, bankers for their continued support during the year. We place on record our appreciation of the contribution made by our employees at all levels. Our consistent growth was made possible by their hard work, solidarity, cooperation and support.

The Directors also take this opportunity to thank all Auditors, Bankers, Consultants, Investors, Clients, Government and Regulatory Authorities and Stock Exchanges, for their continued support during the year and look forward to their continued support in the future.

On the behalf of The Board of Directors

Ambar Patel Shailesh Desai

(Managing Director) (Director)

Place: Rakanpur

Date: 28th April, 2018