1. CORPORATE INFORMATION:

Astron Paper & Board Mill Limited is a public company domiciled in India and is incorporated under the provisions of the Companies Act applicable in India. The shares of the company are listed in two recognized stock exchanges in India i.e. the Bombay Stock Exchange Limited ('BSE') and the National Stock Exchange of India Limited ('NSE).The company is engaged in the manufacturing of Kraft Paper from waste paper.

* Nature of Security

A Primary Security & Collateral-First Pari Passu Charge

- Secured by Paripassu Charge Over Entire Fixed Assets (Present and Future) of the Company.

a Secured by Paripassu Equitable Mortgage of Factory Land & Building situated at R.S. No. 52/1, 52/2, 53/1, 53/ paiki 2, 54, & 55 Village Sukhpar, Tal.: Halvad, Dist.:Morbi

b Factory Land Situated at Survey No. 49/1 & 50 Village Sukhpar, Tah.: Halvad, Dist.: Morbi

c Secured by Paripassu Equitable Mortgage of Residential Flat at 602, Swagat Apartment, Manav Mandir, Memnagar, Ahmedabad

d Secured by Paripassu Equitable Mortgage of Office Premises at D-702, Ganesh Meridian, S.G. Road, Ahmedabad

e Secured by Paripassu Equitable Mortgage of Residential Complexes at plot no. 72 to 75, 82 to 84, Umiya Township, Village Sukhpar, Viramgam Halvad Highway, Ta.: Halvad, Dist. Morbi

f Secured By Exclusive Charge on Land, Building and Plant & Machinery situtated at Survey No. 64/1, Village: Chubdak, Bhuj in Favour Uninon Bank of India for new term loan availed for Building & Plant &Manchiery for plant at above address.

B Collateral Security

Pari Passu Second Charge over the entire current assets of the company.

Common Collateral Security for all of the Credit Facilities Including Working Capital Facilities except for Term Loan Taken As Per point No. A(f) above:

** Entire Term loans secured by personal/corporate guarantees of the following persons/parties.

- Directors

Shri Kiritbhai G. Patel

Shri Ramakant K. Patel

Shri Karshanbhai H. Patel

- Corporate Guarantee [Not for The Enhanced Exposure of Rs. 16.60 Crores during the Financial Year 2015-16]

M/s. Krupal Trading Company M/s. Shivam Industries

***Term Loan from UBI of Rs.20.00 Crores to be repaid in 84 Monthly Instalment of Rs.23.80 Lacs and Instalment Payment to commence from Sep.-201 2.

Additional Term Loan from UBI of Rs.5.00 Crores to be repaid in 24 Quarterly Instalment of Rs.20.90 Lacs and Instalment Payment to commence from January-201 4. (i.e. in line with SBI Sanction)

Term Loan from Corporation Bank to be repaid by 84 Monthly Instalment of Rs.11.90 Lacs and Instalment to Commence from Nov.-2012

Term Loan from SBI to be repaid by 24 Quarterly Instalment of Rs.43.10 Lacs and Instalment to Commence from January-201 4 i.e. after one year from the date of First Disbursement.

Term Loan from UBI of Rs. 4.00 Crores to be repaid by 60 Monthly Instalment of Rs. 4.78 Lacs, 12 Monthly Instalment and Instalment of Rs.6.52 lacs and 5 Monthly Instalment of Rs. 6.99 Lacs Commencing from April-201 6.

Term Loan from Corporation Bank of Rs. 1.60 Crores to be repaid by 60 Monthly Instalment of Rs. 1.91 Lacs, 12 Monthly Instalment of Rs. 2.69 Lacs, 4 Monthly Instalment of Rs. 2.60 Lacs and 1 Instalment of Rs. 2.72 Lacs, Instalment to Commence from April-2016.

Term Loan from SBI of Rs. 2.00 Crores to be repaid by 28 Quarterly Instalment of Rs. 7.14 Lacs and Instalment to Commence from April-201 6.

Term Loan from UBI of Rs. 9.00 Crores (For Bhuj Plant) to be repaid by 20 Quarterly Instalment of Rs. 45 Lacs and Instalment to Commence from 31/10/2018.

* Nature of Security A Primary Security

Working Capital secured by way of First Pari Passu charge on all the current assets of the company including all kind of stocks, stores, spares, packing materials, movable properties and all book debts, bills, monies and claims receivable.

B Collateral Security

Common Collateral Security for all of the Credit Facilities Including Term Loans:

a Secured by Paripassu Equitable Mortgage of Factory Land & Building situated at R.S. No. 52/1, 52/2, 53/1, 53/ paiki 2, 54, & 55 Village Sukhpar, Tal.: Halvad, Dist.:Morbi b Factory Land Situated at Survey No. 49/1 & 50 Village Sukhpar, Tah.: Halvad, Dist.: Morbi c Secured by Paripassu Equitable Mortgage of Residential Flat at 602, Swagat Apartment, Manav Mandir, Memnagar, Ahmedabad

d Secured by Paripassu Equitable Mortgage of Office Premises at D-702, Ganesh Meridian, S.G. Road, Ahmedabad

e Secured by Paripassu Equitable Mortgage of Residential Complexes at plot no. 72 to 75, 82 to 84, Umiya Township, Village Sukhpar, Viramgam Halvad Highway, Ta.: Halvad, Dist. Morbi

C Pari Passu Second Charge over the entire fixed assets (present & future) of the company.

** Outstanding balances of working capital secured by personal/corporate guarantees of the following:

- Directors

Shri Kiritbhai G. Patel Shri Ramakant K. Patel Shri Karshanbhai H. Patel

- Corporate Guarantee [Not for The Enhanced Exposure of Rs. 16.60 Crores during the Financial Year 2015-16]

M/s. Krupal Trading Company

M/s. Shivam Industries

*** Working capital loans repayable on demand.

c) Debtors of Sale of Goods

The company has initiated legal proceedings for recovery against the doubtful debtors amounting to Rs. 59.11 lacs (Previous Year Rs. 96.17 lacs). In respect of debts of Rs. 59.11 lacs though the company has initiated legal proceedings for the recovery, in view of the management of the company since the matters are pending before respective statutory authorities, it is most likely that the company will be able to recover the amount from the doubtful debtors on adjudication of matters and hence the company has not made any provision against the doubtful debts of Rs. 59.11 lacs (Previous Year Rs. 59.11 lacs).

d) Disputed Government Liabilities:

2 .Disputed Central Excise Liabilities:

The Central Excise Department had disallowed CENVAT credit of Rs. 26.43 lacs on capital goods in respect of which the company had preferred an appeal before the Assistant Commissioner of Central Excise, Surendranagar. The Assistant Commissioner vide his order dated 25th January, 2017 has confirmed the disallowance of CENVAT Credit of Rs. 26.43 lacs. The company has reversed the CENVAT Credit of Rs. 26.43 lacs in the books on 01 /06/ 2016. The company has reversed the CENVAT Credit in the books which has been shown as Pre-deposit of Excise as "Short Term Loans & Advances" in the financial statements. Further, Assistant Commissioner had ordered charging of interest as per the Central Excise Law and imposed penalty of Rs. 26.43 lacs Being dissatisfied with the order, the company had preferred an appeal before Commissioner of Appeals, Central Excise, Rajkot on 27th March, 2017 The matter was pending before the Commissioner of Appeals, Central Excise, Rajkot for its final disposal as at the end of the financial year.

3.Disputed Income Tax Liabilities A.Y. 2013-14:

The Income Tax Officer Ward 1(1)(4), Ahmedabad had disallowed preliminary expenses of Rs. 3.89 lacs claimed by the company during the financial year 2012-13 relevant to A.Y. 2013-14. In respect of the said disallowance, the company had preferred an appeal before the CIT-A-1, Ahmedabad, who had also confirmed the amount disallowed by the Income Tax Officer. Against the order of CIT-A-1, the company had further preferred an appeal before Ho'nable ITAT, Ahmedabad. The appeal before the Ho'nable ITAT is pending for adjudication. In view of the management of the company, the company is eligible to claim expenditure disallowed U/s. 35D of the Income Tax Act, 1 961 and hence has not made any provision for amount disallowed amounting to Rs. 3.89 lacs.

4.Disputed Income Tax Liabilities A.Y. 2014-15:

The DCIT Circle 1(1)(2), Ahmedabad had disallowed preliminary expenses of Rs. 4.36 lacs claimed by the company during the financial year 2013-14 relevant to A.Y. 2014-1 5. In respect of the said disallowance, the company had preferred an appeal before the CIT-A-1, Ahmedabad, who had also confirmed the amount disallowed by the Income Tax Officer. Against the order of CIT-A-1, the company had further preferred an appeal before Ho'nable ITAT, Ahmedabad. The appeal before the Ho'nable ITAT is pending for adjudication. In view of the management of the company, the company is eligible to claim expenditure disallowed U/s. 35D of the Income Tax Act, 1 961 and hence has not made any provision for amount disallowed amounting to Rs. 4.36 lacs.

5.Disputed Income Tax Liabilities A.Y. 2015-16:

The Income Tax Officer Ward 1(1)(4), Ahmedabad had disallowed preliminary expenses of Rs. 4.59 lacs claimed by the company during the financial year 2014-15 relevant to A.Y. 2015-16. In respect of the said disallowance, the company had preferred an appeal before the CIT-A-1, Ahmedabad, who had also confirmed the amount disallowed by the Income Tax Officer. The appeal before the Ho'nable CIT-A-1, Ahmedabad is pending for adjudication. In view of the management of the company, the company is eligible to claim expenditure disallowed U/s. 35D of the Income Tax Act, 1 961 and hence has not made any provision for amount disallowed amounting to Rs. 4.59 lacs.

f) Financial Instruments and Related Disclosures:

Financial Risk Management:

The company activities are exposed various financial risks: credit risk, liquidity risk and foreign exchange fluctuation risk. The Company's primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance.

I. Credit Risk:

Trade Receivables:

Credit risk refers to the risk of default on its obligation by the counterparty resulting in a financial loss to the Company. The maximum exposure to the credit risk as at the reporting date is primarily from trade receivables. Trade receivables are unsecured and are derived from revenue earned from customers from sale of goods. Trade receivables generally are impaired after three years when recoverability is considered doubtful based on general trend. The Company considers that trade receivables stated in the financial statements are not impaired and past due for each reporting dates under review are of good credit quality subject to outcome of the litigations where the company has initiated legal proceedings for recovery.

Other Financial Assets:

Credit risk relating to cash and cash equivalents is considered negligible since the counterparties are banks which are majorly owned by Government of India and are have oversight of Reserve Bank of India. The Company considers the credit quality of term deposits with banks to be good and the company reviews these banking relationships on an ongoing basis.

The Company considers all other financial assets as at the balance sheet dates to be of good credit quality.

II. Liquidity Risk:

The company's principal sources of liquidity are from Short Term Bank Borrowings, Cash and Cash Equivalents and Cash generated from operations.

The Short term liquidity requirements consist mainly of Trade Payables, Expense Payables, Employee Dues, Servicing of Interest on Short Term and Long Term Borrowings and payment of instalments of term loans and vehicle loans and other payments arising during the normal course of business.

III. Foreign Exchange Rate Risk:

The Company undertakes transactions denominated in foreign currency mainly for purchase of raw materials which are subject to the risk of exchange rate fluctuations. Financial assets and liabilities denominated in foreign currency are also subject to reinstatement risks. Hedging is regularly carried out to mitigate the risks of exchange rate fluctuations.

g) Corporate Social Responsibility Expenditure:

The company had incurred following expenditures in terms of section 135 of the Companies Act, 201 3 on Corporate Social Responsibility.

h) Government Grants:

The company received subsidy of Rs. 21.90 lacs from Industrial Commissioner Office, Gandhinagar during the year on account of activities undertaken by it for emission of pollution under Environment Management Policy, 2015. The subsidy so received has been treated as income and has been presented as "Other Income" in the financial statements.

i) IPO Proceeds:

During the year ended 31st March, 2018 the company completed Initial Public Offer (IPO) of 1,40,00,000 Equity Shares of Rs. 10 each at a price of Rs. 50 each in case of entities other than eligible employees and at a price of Rs. 47.50 each in case of eligible employees. The equity shares of the company are listed on Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) on 29th December, 201 7.

l) The company has initiated the process of obtaining confirmations from suppliers as to their status as Micro, Small or Medium Enterprise registered under the applicable category as per the provisions of the Micro, Small and Medium Enterprises (Development) Act, 2006 (MSMED Act, 2006). In absence of the relevant information as to the status of the suppliers, the balance due to Micro, Small and Medium Enterprises and interest due to them if any as per the provision of the Micro, Small and Medium Enterprises (Development) Act, 2006 (MSMED Act, 2006) could not be disclosed or provided. m) In the opinion of the Board of Directors, Current Assets & Loans and Advances have a value on realisation in the ordinary course of business equal to the amount at which they are stated in the balance sheet. In the opinion of the Board of Directors, claims receivable against property/goods are realizable as per the terms of the agreement and/or other applicable relevant factors and have been stated in the financial statements at the value which is most probably expected to be realized. n) The company has obtained balance confirmation from some of the parties for Sundry Creditors, Sundry Debtors and parties to whom loans/advance have been granted. All other balances of debtors and creditors and loans and advances are subject to confirmation and subsequent reconciliation, if any. o) Expenses in foreign currency :

CIF Value of I mports:

Raw Materials Rs. 1 3094.54 lacs (Previous Year Rs. 8972.58 lacs)

Foreign Travelling :

Rs. NIL/- (Previous Year Rs. 0.82 lacs)

FOB Value of Exports:

Rs. 952.03 lacs (Previous Year Rs. 55.57lacs)

p) The previous year's figures have been reworked, regrouped and reclassified wherever necessary so as to make them comparable with those of the current year.

The Paises are rounded up to the nearest of rupee. The figures wherever shown in bracket represent deductions.