Annual Report 2015-16 VAMA INDUSTRIES LIMITED. Atchyuta Rama Raju ... Vani Nagar Malkajgiri,...

31stAnnual Report

2015-16VAMA INDUSTRIES LIMITED

VAMA

R

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PAGE CONTENTS

VAmA INduSTrIES LImITEd

02 Corporate Information 04 Message from the Chairman 05 Notice 14 Directors’ Report23 Secretarial Audit Report 42 Management Discussion and Analysis Report47 Conservation of Energy, Research and Development59 Corporate Governance Report83 CEO&CFOCertification84 CertificateonCorporateGovernance85 Auditor’s Report 91 Balance Sheet 92 StatementofProfitandLoss 93 Cash Flow Statement 94 Statement of Changes in Equity95 Notes forming part of Financial Statements 119 Attendance Slip 121 Proxy form123 Ballot form124 Route Map

INSIdE

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Corporate Information

Executive directors

V. Atchyuta Rama RajuV. Rajam Raju

Non Executive & Independent directors V. Rama Krishna Rao R. Venkateswara Rao K. Vara Prasad Raju R. Rama Sravanthi

Statutory Auditor GV & Co. Grandhi VittalChartered Accountants#H.No 2159, Ananda Nilayam, Street No.3, Vani Nagar Malkajgiri, Hyderabad – 500047.

BankersState Bank of IndiaHDFCLtdCorporation Bank

Registered Office Ground Floor, 8-3-191/147/24 Plot No. B-12, Madhura NagarS.R. Nagar[Post], Hyderabad 500 038Telangana., India. Tel: +91 40 6661 5534 / 6661 9919 Fax: +91 40 2370 8672

Corporate Office at Mumbai

OfficeNo:619,6thFloor,Maker Chambers - VNariman Point, Mumbai - 400021, Mah., India.

Secretarial Consultants P.S Rao & AssociatesCompany SecretariesFlat No: 10, 4th Floor # 6-3-347/22/2,Dwarkapuri Colony, Panjagutta, Hyd– 082

Cut off date Date: 19th September, 2016 [Monday]

designation

Chairman and managing directorExecutive director

Company Secretary & Compliance Officer Rohit Tibrewal

Internal Auditor V.N.S. SrinivasChartered AccountantH. No. – 13-1-185/4, Sree NilayamSnehapuri Colony, Moti Nagar,Hyderabad-500018.

registrar & Share Transfer Agents M/s.BigshareServicesPrivateLimited306, Right Wing, Amrutha VilleOpp.Yashoda Hospital, Somajiguda,Rajbhavan Road, Hyderabad – 500 082, T.S. India.

Corporate Office at HyderabadGround Floor, 8-2-248/1/7/78/12,13Block-A,LaxmiTowers,NagarjunaHills,Punjagutta, Hyderabad - 500082Website & email Id for Investors Website : www.vamaind.comemail Id : [email protected]

31st Annual General meetingDate & Time : 26th September, 2016 at 10.00 A.MDay: MondayVenue: Hotel Innner Circle, Raj Bhavan Road, Somajiguda,Hyderabad – 082.

dates of Book Closure From: 20th September, 2016 [Tuesday]To: 26th September, 2016 [Monday](Both days inclusive)

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Committees of the Board

Audit Committee V. ramakrishna rao r. Venkateswara rao K. Vara Prasad raju (Chairman) (Member) (Member)Nomination & r. Venkateswara rao V. ramakrishna rao K. Vara Prasad rajuremuneration Committee (Chairman) (Member) (Member)risk management V. ramakrishna rao V.A rama raju V. rajam raju Committee (Chairman) (Member) (Member)Stakeholders r. Venkateswara rao V. ramakrishna rao V. A. rama rajurelationship Committee (Chairman) (Member) (Member)

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dear Fellow Shareholders, Greetings!

Itgivesmeimmensepleasuretopresentabriefreportontheperformanceofourcompanyforthefinancialyear2015-16.FY ’15-’16 was a year of consolidation for our company. The quantum jump of FY 2014-15 performance had thrown open many challenges and the major being, sustainability. I am overwhelmed by FY 2015-16 performance as it proves a point that our company has achieved the stability required to scale higher in the years to come. I take this opportunity to assert all my fellow shareholders that our company is at the threshold of a high growth path and the performance shall speak for itself in the immediate years to come. As you all know, our company operates in two segments:

1. Defence and Space.

2. ITES.

defence and Space:

In this segment, our company had humble beginning as a box seller i.e. sale of laptops and desktops and from this stage we have grown to a position of system integrator. During this journey, we have entered in to Enterprise class business which effectively means we are setting up data centers at various locations thus enabling the basic infrastructure. The initial relationship was with one organization and the same has grown multifold. It is hearting to share with you that we are competing with big names in the industry, to procure orders. All the major OEMs have started recognizing us and their support, to bid projects, is overwhelming.

ITES:

It is this vertical which had given your company the required momentum in the initial days of business. The business process services, which include product design and development, delivers solutions, enable our clients to do business better. All the revenue in this segment is in foreign currency. Though this vertical was contributing more revenues in the earlier days, the share in overall revenue has come down because of factors like completion scope of work, client opening a base in India. Management’s efforts to increase the turnover are paying and results shallbereflectedattheearliest.

External factors shall also have a bearing on company’s performance. India is one of the few countries to have a positive growth in adverse global developments. The effects of Brexit slow/no growth rate of America are to be traded cautiously as the magnitude of negative effect on the Indian economy is to be assessed. However, w e areconfidentofgrowthindefenceandspaceareasastheyhavebecomeessentialforanycountry’stechnicaladvancement and India being the cheapest provider of these services, we feel more comfortable to have been in these segments.

With Best Wishes

Sd/- V. A. rama raju Chairman and Managing Director

23rd August, 2016Hyderabad.

message from the Chairman

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Notice31st Annual General meeting

Notice is hereby given that the Thirty First (31st) Annual General Meeting [AGM] of the members of VamaIndustriesLimitedwillbeheldonMonday,26thday of September, 2016 at 10.00 A.M at Hotel Inner Circle, Raj Bhavan Road, Somajiguda, Hyderabad - 500082, to transact the following items of business :

OrdINArY BuSINESS

Item 1: Adoption of Financial Statement

To receive, consider and adopt the audited Financial Statement of the Company for the Financial Year ended March 31, 2016, the Reports of the Board of Directors and Auditors thereon.

Item 2: declaration of dividend

To declare final dividend on equity shares for thefinancialyearendedMarch31,2016.

Item 3: reappointment of director

To appoint a Director in place of Smt. R. Rama Sravanthi (DIN:07098278) who retires by rotation and being eligible offers herself for reappointment.

Item 4: Ratification of Appointment of Auditors

To ratify the appointment of Statutory Auditors of the Company and to fix their remuneration and in thisregard,toconsiderandif thoughtfit, topasswithorwithoutmodification(s),thefollowingresolutionasanOrdinary Resolution:

“RESOLVED THAT pursuant to the provisions of Sections 139, 142 and all other applicable provisions contained under the Companies Act, 2013, read with relevant Rules made thereunder, and pursuant to the recommendation of the Audit Committee and the resolution passed by the members in their AGM held on 25.09.2014, the appointment of M/s GV &Co, Chartered Accountants, (Registration No. 012875S), Hyderabad who were appointed as the Statutory Auditors of theCompany to hold theofficeas suchtill the conclusion of 32nd Annual General Meeting, beand ishereby ratifiedand theBoardofDirectorsof theCompanybeandareherebyauthorisedtofixthe remuneration payable to the Statutory Auditors for theauditoftheaccountsforthefinancialyearendingMarch 31, 2017.”

SPECIAL BuSINESS:

Item 5: Sub-Division of the nominal value of the equity share.

Toconsiderandifthoughtfit,topasswithorwithoutmodification(s), thefollowingresolutionasaSpecialResolution:

“RESOLVED THAT pursuant to the provisions of section 61 and other applicable provisions, if any, of the Companies Act, 2013 and Rules made there under (includinganystatutorymodificationsorre-enactmentthereof for the time being in force), and in accordance with Article 56 of theArticles of Association of the Company and subject to the approvals, consents, permissionsand sanctions, if any, required from any authority and subject to such conditions as may be agreed to by the Board of Directors of the Company (hereinafter referred to as “the Board”,which in term shall also include any Committee thereof), consent of the Members be and is hereby accorded to sub-divide each Equity Share of the Company having Face value of Rs.10/- (Rupees Ten only) into 5(Five) Equity Shares of Face value of Rs. 2/- (Rupees Two only)each fully paid-up and consequently, the Authorized Share Capital of the Company of Rs.11,00,00,000/- (Rupees Eleven Crores only) would comprise of 5,50,00,000(FiveCrores Fifty Lakhs) Equity Sharesof Rs. 2/- (Rupees Two only) each with effect from the “Record Date” to be determined by the Board for this purpose.”

“RESOLVED FURTHER THAT pursuant to the sub-division of the Equity Shares of theCompany each Equity Share of the Face value of Rs. 10/- (Rupees Ten only) as existing onthe Record Date shall stand sub-divided into 5(Five) Equity shares of the Face value of Rs. 2/-(Rupees Two only) each fully paid-up, with effect from the record date.”

“RESOLVED FURTHER THAT on sub-division, the 5(Five) Equity Shares of the Face value of Rs. 2/- (Rupees Two only) each be issued in lieu of one Equity Share of Rs. 10/-(Rupees Ten only) each, subject to the terms of Memorandum and Articles of Association of the Company and shall rank paripassu in all respects and shall have the same rights as the existing fully paid Equity Shares of Rs. 10/- (Rupees Ten only) each of the Company.”

“RESOLVED FUTHER THAT upon sub-division of Equity Shares of the Company as aforesaid, the

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existingsharecertificate(s)inrelationtotheexistingEquity Shares of Face value of Rs. 10/- (Rupees Ten only) each held in physical form shall be deemed to have been automatically cancelled and be of no effect on and from the Record Date of sub-division and the Company may, without requiring the surrender of existing share certificate(s) directly issue anddispatchthenewsharecertificate(s)oftheCompanyin lieu of such existing sharecertificate(s)within theperiod prescribed or that may be prescribed in this behalf from time to time and in the case of shares held in dematerialized form, the number of sub-divided EquityShares be credited to the respective beneficiary accounts of the shareholders with theDepository Participants, in lieu of the existing credits representing the Equity Share beforesub-division.”

“RESOLVED FURTHER THAT the Board be and is hereby authorized to fix a Record Dateand totake such steps as may be necessary for obtaining approvals, statutory, contractual orotherwise, in relation to the above and to settle all matters arising out of and incidental there to, and to execute all deeds, applications, documents and writings that may be required,on behalf of the company and generally to do all such acts, deeds, matters and things and to give such directions as may be necessary, proper and expedient or incidental for the purpose of giving effect to this resolution.”

“RESOLVED FURTHER THAT the Board be and is hereby authorized to delegate all or anyof its powers to any Committee thereof as it may deem appropriate in this regard.”

Item 6: Amendment to clause V of the memorandum of Association of the Company.

Toconsiderandifthoughtfit,topasswithorwithoutmodification(s), thefollowingresolutionasaSpecialResolution:

“RESOLVED THAT pursuant to the provisions contained in Section 13, 61 and otherapplicable provisions, if any, of the Companies Act, 2013 (including any statutorymodification(s), amendmentor re-enactment thereof), the existing Clause V of the Memorandum of Association of the Company be and is hereby amended by deletion of the existing

Clause V and by substitution thereof by the following clause:

‘V. The Authorized Share Capital of the Company is Rs.11,00,00,000/- (Rupees Eleven Crores Only) divided into5,50,00,000(FiveCroresFiftyLakhs)EquitySharesof Rs. 2/-(Rupees Two) each, with the rights, privileges and conditions attached thereto as are provided by regulations of the Company for the time being in force , with power to increase and reduce the Capital of the Company and to divide the shares in the capital for the time being into several classes and to attach thereto respectively such preferential rights, privileges or conditions as may be determined by or in accordance with the regulations of the Company and to vary, modify or abrogate any such rights, privileges or conditions in such manner as may for the time being be provided by the regulations of the Company.’

“RESOLVED FURTHER THAT the Board of Directors or a Committee thereof be and is hereby authorized to do all such acts, deeds, matters and things as may be considered necessary, desirable and expedient for giving effect to this resolution and/or otherwise considered by them in the best interest of the Company.”

By the Order of the Board ForVamaIndustriesLimited

Sd/- Rohit Tibrewal Company Secretary M. No. – A31385 Date: 23rd August, 2016Hyderabad

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NOTES :

1. AMEMBERENTITLEDTOATTENDANDVOTEATTHEMEETINGISENTITLEDTOAPPPOINTONE OR MORE PROXY TO ATTEND AND ON A POLL, TO VOTE INSTEAD OF HIMSELF. APROXY NEED NOT BE A MEMBER OF THE COMPANY.THE INSTRUMENT APPOINTING THEPROXYSHOULDBEDEPOSITEDATTHEREGISTERED OFFICE OF THE COMPANY NOT LESS THAN 48 HOURS BEFORE THECOMMENCEMENT OF THE MEETING.

APERSONCANACTASAPROXYONBEHALFOF MEMBERS NOT EXCEEDING FIFTY AND HOLDING IN THE AGGREGATE NOT MORETHANTENPERCENTOFTHETOTALSHARECAPITAL OF THE COMPANY CARRYINGVOTINGRIGHTS.AMEMBERHOLDINGMORETHANTENPERCENTOFTHETOTALSHARECAPITAL OF THE COMPANY CARRYINGVOTING RIGHTS MAY APPOINT A SINGLEPERSON AS PROXY AND SUCH PERSON SHALLNOTACTASAPROXYFORANYOTHERPERSONORSHAREHOLDER.

2. Members are requested to bring their attendance slip along with their copy of Annual Report to the Meeting.

3. Corporate Members intending to send their authorised representative to attend the Meeting arerequestedtosendtothecompanyacertifiedcopy of the Board Resolution authorizing their representative to attend and vote on their behalf at the Meeting.

4. In case of joint holders attending the Meeting, only such joint holders who are higher in the order of names will be entitled to vote.

5. The Register of Members and Share Transfer Books will remain closed from Tuesday, September 20, 2016 to Monday, September 26, 2016 (both days inclusive).

6. Relevant documents referred to in the accompanying Notice and the Statement are open for inspection by the members at the Registered

Office of the Company on all working days,except Saturdays, during business hours upto the date of the Annual General Meeting.

7. The dividend on Equity shares, if declared at the Meeting, will be dispatched / credited to those members whose names shall appear on the Company’s Register of Members on Monday, September 19, 2016 and in respect of the shares held in dematerialized form, the dividend will be paid to members whose names are furnished by National SecuritiesDepository Limited [NSDL]andCentralDepositoryServices(India)Limited[CDSL]asbeneficialownersasonthatdate.

8. Members, who hold shares in the dematerialized form and wish to change/ rectify the bank account details should send the same immediately to their concerned Depository Participant and not to the Company. Members are also requested to give the MICR code of their Bank to their Depository Participants. While making payment of Dividend, Registrar is obliged to use only the data provided by the Depositories.

9. Physical Shares – Payment of Dividend through NECS: Members holding shares in Physical form are advised to submit particulars of their Bank account viz. Name and Address of the Branch of the Bank, MICR code, type of account and account number to our Registrar and Share Transfer Agent, M/s Bigshare Services Private Limited,Hyderabad.

10. Members holding shares in Physical form are requested to advise any change of address immediately to the Company/ Registrar and Share Transfer Agent M/s. Bigshare Services PrivateLimited.

The Securities and Exchange Board of India (SEBI) has mandated the submission of Permanent Account Number (PAN) by every participant in securities market. Members holding shares in electronic form are, therefore, requested to submit their PAN to their Depository Participants with whom they are maintaining their Demat accounts. Members holding shares

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in physical form may submit their PAN to the Company/BigShareServices(P)Ltd.

11. Members who are holding Physical Shares in identical order of names in more than one folio are requested to send to the Company or to the Company’s Share Transfer agent, the details of suchfoliostogetherwiththeShareCertificatesfor consolidating their holding into single folio. The Share Certificates will be returned tothe members after making requisite changes thereon.

12. Members who wish to claim Dividend, which has remained unclaimed are requested to either correspond with the Secretarial Department at the Company’s Registered Office or theCompany’s Registrar and Share Transfer Agent(M/s.BigshareServicesPrivateLimited).Members are requested to note that dividends not encashed or not claimed within Seven Years from the date of transfer to the Company’s Unpaid Dividend Account, will as per Section 205A(5) read with Section 205C of the Companies Act, 1956 (Section 124 (5) read with Section 125 (1) of the Companies Act, 2013) shall be transferred to the Investor Education and Protection Fund (IEPF) of Government of India.

13. Members are requested to mandatorily quote their Registered Folio No. or Demat Account No. and Depository Participant IdentificationNumber (DPID No) on all correspondence with the company.

14. Securities and Exchange Board of India [SEBI] vide circular ref No.MRD/Dop/CIR-05/2007 dated April 27, 2007 made PAN, the sole Identification Number for all participantstransacting in the Securities Market, irrespective of the amount of transaction. In continuation to theaforesaidcircular,itisherebyclarifiedthatforSecurities Market Transactions and off market/ private transactions involving transfer of shares of listed companies in Physical form, it shall be mandatory for the transferee(s) to furnish copy of PAN card to the company/ RTA for registration of such Transfer of Shares.

15. Members are advised to update their email IDs with Company’s RTA and/or concerned Depository participants as soon as possible.

16. Remote E-Voting The items of business as set out in the Notice

may be transacted through electronic voting system. Therefore, the Company is providing facility for voting by electronic means. Pursuant to Section 108 of the Companies Act 2013, read with Rule 20 of the Companies (Management and Administration) Rules, 2014, as amended from time to time and in force as on date and Regulation44ofSEBI(ListingObligationsandDisclosure Requirements) Regulations, 2015, the Company is pleased to offer remote e-voting facility, as an alternate, to its members in respect of the business to be transacted at the AGM.

The Members, whose names appear in the RegisterofMembers/listofBeneficialOwnersas on Monday, September 19, 2016, i.e. the date prior to the commencement of Book Closure date, are entitled to vote on the resolutions set forth in this Notice. Eligible members who have acquired shares after the dispatch of the Annual Report may approach the Company for required assistance in connection with generation of the User ID / Password in order to exercise their right to vote by electronic means. The remote e-voting period will commence at 9.00 A.M. on Friday, September 23, 2016 and will end at 5.00 P.M. on Sunday, September 25, 2016. The members will not be able to cast their votes electronically beyond the date and time mentioned above.

The Company has appointed Mr. Vikas Sirohiya, Practicing Company Secretary (Membership. No. 15116 and C.P No. 5246) to act as the Scrutinizer to conduct and scrutinize the voting process in a fair and transparent manner. The Members desiring to vote through electronic mode may refer to the detailed procedure on remote e-voting given hereunder:

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PROCEDURE FOR REMOTE E-VOTING:

The remote e voting period begins on Friday, September 23, 2016 (9.00 A.M.) and ends on Sunday, September 25, 2016 (5.00 P.M.). During this period shareholders of the Company, holding shares either in physical form or in dematerialized form, as on the cut-off date i.e. September 19, 2016, may cast their vote electronically. The remote e-votingmoduleshallbedisabledbyCDSLforvotingthereafter.

A. In case of members receiving e-mail (for members whose e-mail address are registered with the Company/depositories)

(i) The shareholders should log on to the remote e-voting website www.evotingindia.com.

(ii) Click on “Shareholders” tab.

(iii) Now Enter your User ID

a. ForCDSL:16digitsbeneficiaryID,b. ForNSDL:8CharacterDPIDfollowedby8DigitsClientID,c. Members holding shares in Physical Form should enter Folio Number registered with the

Company.

(iv) NextentertheImageVerificationasdisplayedandClickonLogin.

(v) If you are holding shares in demat form and had logged on to www.evotingindia.com and voted on an earlier voting of any company, then your existing password is to be used.

(vi) Ifyouareafirsttimeuserfollowthestepsgivenbelow:

For Members holding shares in Demat/ 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 arerequestedtousethefirsttwolettersoftheirnameandthe8digitsofthesequencenumberinthePANfield.

• Incasethesequencenumberislessthan8digitsentertheapplicablenumberof‘0’sbeforethenumberafterthefirsttwocharactersofthenameinCAPITALletters.Eg.IfyournameisRameshKumarwithsequencenumber1thenenterRA00000001inthePANfield.

DOB Enter the Date of Birth as recorded in your demat account or in the company records for the said demat account or folio in dd/mm/yyyy format.

Enter the Dividend Bank Details as recorded in your demat account or in the company records for the said demat account or folio.

• PleaseentertheDOBorDividendBankDetailsinordertologin.Ifthedetailsarenotrecordedwith the depository or company please enter the member ID / folio number in the Dividend Bank detailsfieldasmentionedininstruction(iii).

DividendBank Details

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(vii) After entering these details appropriately, click on “SUBMIT” tab. (viii) 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 tomandatorilyentertheirloginpasswordinthenewpasswordfield.Kindlynotethatthispasswordistobealso used by the demat holders for voting for resolutions of any other company on which they are eligible to vote,providedthatcompanyoptsforremotee-votingthroughCDSLplatform.Itisstronglyrecommendednottoshareyourpasswordwithanyotherpersonandtakeutmostcaretokeepyourpasswordconfidential.

(ix) For Members holding shares in physical form, the details can be used only for remote e-voting on the resolutions contained in this Notice.

(x) Click on the EVSN for the relevant <Company Name> on which you choose to vote.

(xi) 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.

(xii) Click on the “rESOLuTIONS FILE LINK” if you wish to view the entire Resolution details.

(xiii) After selecting the resolution you have decided to vote on, click on “SuBmIT”. Aconfirmationboxwillbedisplayed.Ifyouwishtoconfirmyourvote,clickon“OK”,elsetochangeyourvote,clickon“CANCEL”andaccordingly modify your vote.

(xiv) Once you “CONFIrm” your vote on the resolution, you will not be allowed to modify your vote.

(xv) You can also take out print of the voting done by you by clicking on “Click here to print” option on the Voting page.

(xvi) IfDemataccountholderhasforgottenthesamepasswordthenEntertheUserIDandtheimageverificationcode and click on Forgot Password & enter the details as prompted by the system.

(xvii) Note for Non – Individual Shareholders and Custodians

• Non-Individualshareholders(i.e.otherthanIndividuals,HUF,NRIetc.)andCustodianarerequiredtolog on to www.evotingindia.com and register themselves as Corporate.

• AscannedcopyoftheRegistrationFormbearingthestampandsignoftheentityshouldbeemailedto [email protected].

• After receiving the login details a compliance user should be created using the admin login andpassword. The Compliance user would be able to link the account(s) for which they wish to vote on.

• The listofaccountsshouldbemailed [email protected] the

accounts they would be able to cast their vote.

• Ascannedcopyof theBoardResolutionandPowerofAttorney(POA)which theyhave issued infavour of the Custodian, if any, should be uploaded in PDF format in the system for the scrutinizer to verify the same.

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(xviii) In case you have any queries or issues regarding remote 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].

B. In case of members receiving the physical copy of Notice of AGM (for members whose e-mail ids are not registered with the Company/depositories):

Please follow all the steps from Sl. No. (i) toSl.No.(xvii) to cast vote

TheScrutinizer shall immediately after the conclusion of voting at theAGM, first count the votes cast at theMeeting, thereafter unblock the votes cast through remote e-voting in the presence of at least 2 witnesses not in the employment of the Company and make not later than 3 days of conclusion of the Meeting a consolidated Scrutiniser’s Report of the total votes cast in favour or against, if any, to the Chairman or a person authorised by him in writing who shall countersign the same and declare the result of voting forthwith.

Members who do not have access to remote e-voting facility have been additionally provided the facility of voting on a Ballot Form. They may send duly completed Ballot Form (enclosed with the Annual Report) to the Scrutinizer, Mr.VikasSirohiya,PractisingCompanySecretary(M.No.15116),attheRegisteredOfficeoftheCompanysoasto reach before the conclusion of the 31stAnnual General Meeting or can carry the same to the Annual General Meeting and deposit in the Ballot Box during the Meeting. The facility for voting, either through ballot or poling paper shall also be made available at the Meeting and members attending the meeting who have not already cast their vote by remote e-voting shall be able to exercise their right at the Meeting. The members who have cast their vote by remote e-voting prior to the meeting may also attend the meeting but shall not be entitled to cast their vote again. A member can opt for only one mode of voting, i.e., either through remote e-voting or by Ballot. If a member casts votes by both modes, then voting done through remote e-voting shall prevail and Ballot shall be treated as invalid.

Members have the option to request for physical copy of Ballot Form by sending an e-mail to [email protected] mentioning their Folio / DP ID and Client ID.

The results declared along with the Scrutinizer’s Report will be posted on the Company’s website and communicated to the Stock Exchange.

By Order of the Board For VAmA Industries Limited

Sd/- 23rdAugust, 2016 Rohit Tibrewal Hyderabad. Company Secretary M. No. : A31385

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EXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013.

Item No. 5 & 6

The Equity Shares of the Company are listed on the Bombay Stock Exchange (BSE) and the shares are actively traded on BSE. With a view to enhancing theinvestor base of the company by encouraging the participation of large number of investors and also to increase the liquidity of the equity shares of the Company, the Board of Directors at its meeting held on 23rd August, 2016 has reserved to sub-divide the nominal value of the equity shares of theCompany from Rs. 10/- per share to Rs. 2/- per share, subject to approval of members.

Accordingly, each paid up equity share of nominal value Rs. 10/- (Rupees Ten Only) each of theCompany, existing ontheRecordDateasmaybefixedbytheBoardofDirectors,shallstandsubdividedinto5(five)EquitySharesof Nominal Value of Rs. 2/- (Rupees Two only) each.

TheRecordDatefortheaforesaidsubdivisionoftheequityshareswillbefixedaftertheapprovaloftheshareholdersis obtained, pursuant to this Annual General Meeting.

At present, the Authorised Share Capital of the Company is Rs. 11,00,00,000 /- (Rupees Eleven Crores only) divided into1,10,00,000(OneCroreTenLacsOnly)EquitySharesofRs.10/-(RupeesTen)each.The issued,subscribed and paid up share capital of the Company is divided into 1,05,08,000 (One Crore Five lakhs Eight thousand ) equity shares of Rs.10/- each amounting to Rs.10,50,80,000/- (Ten Crores Fifty lakhs Eighty thousand only).

The proposed sub division of equity shares of the Company from Rs.10/- (Rupees Ten only) perEquity share to Rs.2/-(Rupees Two only) per equity share, requires alteration of the Memorandum of Association of the Company. Accordingly, Clause V of the Memorandum of Association is proposed to be altered in the manner set out in Resolution at Item No.6.

The Board recommends the Special Resolutions for Item Nos. 5 and 6 of the notice for approval of the Members.A copy of the Memorandum of Association of the Company along with the proposed amendments isavailable for inspectionbythemembersattheRegisteredOfficeoftheCompanyonallworkingdaysduringtheofficehoursofthe Company till the conclusion of the Annual General Meeting.

The Directors /Key Managerial Personnel of the Company or their respective relatives are deemed tobe concerned or interested in the Resolutions mentioned in the Item Nos. 5&6 of the Notice only to theextent of shares held by them, if any, in the Company.

By the Order of the Board ForVamaIndustriesLimited

Sd/- 23rdAugust, 2016 Rohit TibrewalHyderabad Company Secretary M. No. : A31385

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Information in respect of Director seeking appointment/ re-appointment as required under SEBI(Listing Obligations and Disclosure Requirements) Regulation, 2015.

Name of the director r. rama Sravanthi

date of Appointment 01.03.2015

date of Birth 01-01-1986

Expertise in Specific Functional areas SheishavingrichexperienceinthefieldofMedical Science. promotions

Educational Qualification Master of Physiotherapy

directorships in other Companies Nil

Membership / Chairmanships of committees of Board(other than Vama) Nil

Shareholding in the NilCompany as on 31.03.2016

Relationship between Nildirectors inter se

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Dear Fellow Shareholders,

YourDirectorsaredelightedtopresentthe31stAnnualReportalongwiththeauditedaccountsforthefinancialyear ended March 31, 2016.

FINANCIAL PErFOrmANCE

Our Financial Performance, for the year ended March 31, 2016 is summarized below:

( `InLakhs)

Particulars 2015-16 2014-15

Turnover 4586.36 4852.90Other Income 15.61 16.78Total Income 4601.97 4869.68PBIDT 141.11 229.81Less:(i)Interest 75.95 47.82(II)Depreciation 24.34 30.50ProfitBeforeExceptionalItemandTax 40.82 151.49Exceptional Item - 52.70ProfitBeforeTax 40.82 98.78Less:ProvisionforTax - Current 19.07 54.40- Deferred (3.36) (5.81)ProfitAfterTax 25.11 50.19Less:Appropriations a) Transfer to Reserves Nil Nilb) Proposed Dividend 10.51 16.48c) Tax on Proposed Dividend 2.14 3.29d) Dividends for (FY 2014-15) 3.04 0e) Tax on Dividend (FY 2014-15) 0.61 0Earnings Per Share (EPS) 0.27 0.66Balance Carried to B/S. 8.81 30.42

PErFOrmANCE SummArY ANd STATE OF AFFAIrS

During the FY ended 31st March, 2016, the total income from the operations of the Company had slightly decreased from Rs 4852.90 lakhs (in the previous FY) to Rs 4586.36 lakhs (in the current FY).

YourCompanypostedaprofitaftertaxofRs25.11Lakhsfortheyearended31stMarch,2016whencomparedtoRs50.19Lakhsfortheyearended31stMarch,2015.

Income on account of engineering & other services stood at Rs.4,46,63,805/- out of which Rs.14,301,740/-was Export Income. Lowerprofitabilityinthisyearwaspredominantlyonaccountofstiffmarketconditionswhichprevailedduringtheyear and the consequent lower realisation. A focused approach and unique strategy adopted for each business

directors’ report:

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division with the objective of sustaining growth helped the Company to minimise the adverse impact contributed by external factors.

No amount is being proposed to be transferred to the Reserves for the current Financial Year.

Apart from the below-mentioned, no material changes and commitments have occurred after the closure of the financialyeartillthedateofthisReport,whichmayhaveaffectedthefinancialpositionoftheCompany.

Issue and allotment of securities

During the year under review, your Company has issued and allotted 12,20,000 equity shares and 4,50,000 warrants convertible into equity shares, on Preferential Allotment basis, for which the member’s approval was sought by way of Postal Ballot.

Further the Company has allotted 3,00,000 equity shares upon conversion of warrants to one of the Promoters of the Company.

CHANGES IN CAPITAL

Sl. No Particulars At the end At the beginning of the Year of the Year (Amt. in `) (Amt. in `)

1 Authorised Capital: Equity Shares of Rs.10/- each 11,00,00,000.00 9,00,00,000.00

2 Issued, Subscribed & Paid up Capital: Equity Shares of Rs. 10/- each 9,75,80,000.00 8,23,80,000.00

Further, the Company has allotted 7,50,000 equity shares of Rs. 10/- each upon conversion of warrants, during the period commencing on 1st April, 2016 and ending till date.

The paid up Capital stands at Rs 10,50,80,000.00 divided into 10,50,8000 equity shares of Rs. 10/- each as on date. Future Outlook

India is the topmost offshoring destination for IT companies across the world. Having proven its capabilities in delivering both on-shore and off-shore services to global clients, emerging technologies now offer an entire new gamutofopportunitiesfortopITfirmsinIndia.

The Indian IT sector is expected to grow at a rate of 12-14 per cent for FY2016-17 in constant currency terms. Realising the wealth of potential in the IT-ITeS sector, the central and state governments are also working towards creating a sound infrastructure for the IT-ITeS Sector.

In this vertical, we have started business process services, which include product design and development, delivers solutions, enable our clients to do business better.

In Defence and Space Sector, our Company had humble beginning as a box seller i.e. sale of laptops and desktops and from this stage we have grown to a position of system integrator. We have entered into Enterprise class

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business which effectively means we are setting up data centers at various locations thus enabling the basic infrastructure.

WeareconfidentofgrowthinDefenceandSpaceareasastheyhavebecomeessentialforanyCountry’stechnicaladvancement and India being the cheapest provider of these services, we feel more comfortable to have been in these segments.

NATurE OF BuSINESS

There was no change in the nature of Business of your Company during the FY ended 31st March, 2016.

dIVIdENd

In view of allotment of 7,50,000 equity shares upon conversion of warrants, which took place subsequent to thecloseofFY2015-16,yourBoardofDirectorsrecommendsafinaldividendof1%(Re.0.10pershare)ontheenhanced capital base of Rs. 10,50,80,000 comprising 1,05,08,000 fully paid equity shares of Rs. 10/- each for the year ended March 31, 2016 [Previous year Rs. 0.20 per equity share of Rs. 10/- each] to be appropriated from the profitsoftheyear2015-16,subjecttotheapprovalofshareholdersattheensuingAnnualGeneralMeeting.TheDividend will be paid in compliance with applicable Regulations.

TrANSFEr OF uNPAId ANd uNCLAImEd AmOuNTS TO IEPF

Pursuant to the provisions of Section 205C of the Companies Act, 1956 and Section 124(5) of the Companies Act, 2013, dividend which remains unpaid or unclaimed for a period of seven years from the date of its transfer to unpaid dividend account is required to be transferred by the Company to Investor Education and ProtectionFund (IEPF), established by the Central Government under the provisions of Section 125 of the Companies Act, 2013. ThedetailsofanyunpaiddividendamountsasperSection125(2)oftheCompaniesAct,2013havetobeidentifiedanduploadedonthewebsiteoftheCompany.Accordingly,unclaimeddividendsuptothefinancialyear2007-08have been transferred to IEPF by the Company.

SuBSIdIArY COmPANIES

Duringthefinancialyearunderreview,wedidnothaveanysubsidiaryorjointventureorassociatecompany.WehaveincorporatedawhollyownedsubsidiaryCompanyinSingaporeinthenameof“VamaTechnologiesPteLtd.“subsequenttotheclosureofthefinancialyear.

COmPOSITION OF BOArd COmmITTEES

We have in place all the Committees of the Board which are required to be constituted under the Companies Act,2013,ListingagreementandSEBI(ListingObligationsandDisclosureRequirements)Regulations,2015.Adetailed note on the Board and its committees is provided under the Corporate Governance Report section in this Annual Report

The Composition of various Committees of the Board is hereunder:

Audit Committee

Mr. V. Ramakrishna Rao – Chairman Mr. R. Venkateswara Rao – Member Mr. K. Vara Prasad Raju – Member

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Nomination and remuneration Committee

Mr. R. Venkateswara Rao – Chairman Mr. V. Ramakrishna Rao – Member Mr. K. Vara Prasad Raju – Member

Stakeholders relationship Committee

Mr. R. Venkateswara Rao – Chairman Mr. V. Ramakrishna Rao – Member Mr. V.A. Rama Raju – Member

risk management Committee

Mr. V. Ramakrishna Rao – Chairman Mr. V.A. Rama Raju – MemberMr. V. Rajam Raju – Member

dIrECTOrS ANd KEY mANAGErIAL PErSONS

Duringthefinancialyearunderreview,themembersofourCompanybywayofPostalBallothavereappointedMr.V. Atchyuta Rama Raju, Chairman & Managing Director of the Company and Mr. V. Rajam Raju, Executive Director of the Company for a further period of three years w.e.f. 01st August, 2015

FurtherintermsofSection152oftheCompaniesAct,2013,Mr.V.RajamRajuwasreappointedtotheofficeofDirector in the previous AGM held on 29th September, 2015.

Duringtheyearunderreview,Ms.ShilpaKotagiri,resignedfromtheofficeofCompanySecretaryandMr.RohitTibrewalwasappointedasCompanySecretary&ComplianceOfficer,aKeyManagerialPersonnelbytheBoardof Directors of the Company in their meeting held on 10.09.2015.

Pursuant to the provisions of Section 152 of the Companies Act, 2013 and in accordance with provisions of Articles of Association of the Company, Mrs. R. Rama Sravanthi retires by rotation at the ensuing AGM and being eligible, offers herself for re-appointment.

We have received declaration from all our Independent Directors confirming that they meet the criteria ofindependence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013 and under Regulation 25ofSEBI(ListingObligationsandDisclosureRequirements)Regulations2015.

BOArd EVALuATION

We, at VAMA believe in striving and excelling against contenders not only through products and initiatives but also througheffectiveandefficientBoardmonitoring.AsrequiredundertheCompaniesAct,2013andSEBI(ListingObligations and Disclosure Requirements) Regulations, 2015, an evaluation of all the directors, the Board as a Whole and its committees was conducted based on the criteria and framework adopted by the Board.

The details of the said evaluation has been enumerated in the Corporate Governance Report, which is annexed to the Boards’ Report.

None of our Independent Directors is due for reappointment.

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POLICY ON dIrECTOrS’ APPOINTmENT, rEmuNErATION, ETC.,

The following policies are attached herewith and marked as Annexure –VI and VII respectively:

a. Policy for selection of Directors and determining Directors Independence; and evaluation mechanism.

b. Remuneration Policy for Directors, Key managerial Personnel and other employees.

MEETINGS OF THE BOARD OF DIRECTORS

The meetings of the Board are scheduled at regular intervals to decide and discuss on business performance, policies,strategiesandothermattersofsignificance.

In certain exigencies, decisions of the Board are also accorded through circulation.

The Board duly met 10 times during the Financial Year 2015-16.The intervening gap between any two consecutive Board Meetings was within the period prescribed under the provisions of the Companies Act, 2013.

Detailed information regarding the meetings of the Board are included in the report on Corporate Governance, which forms part of the Board’s Report.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has laid down certain guidelines, processes and structure, which enables implementation of appropriateinternalfinancialcontrolsacrosstheorganization.Suchinternalfinancialcontrolsencompasspoliciesandproceduresadoptedby theCompany forensuring theorderlyandefficientconductofbusiness, includingadherence to its policies, safeguarding of its assets, prevention and detection of frauds and errors, the accuracy andcompletenessofaccountingrecordsandthetimelypreparationofreliablefinancialinformation.Appropriatereview and control mechanisms are built in place to ensure that such control systems are adequate and are operating effectively.

Becauseoftheinherentlimitationsofinternalfinancialcontrols,includingthepossibilityofcollusionorimpropermanagementoverrideofcontrols,materialmisstatementsinfinancialreportingduetoerrororfraudmayoccurandnotbedetected.Also,evaluationoftheinternalfinancialcontrolsaresubjecttotheriskthattheinternalfinancialcontrol may become inadequate because of changes in conditions, or that the compliance with the policies or procedures may deteriorate.

TheCompany has, in allmaterial respects, an adequate internal financial controls system and such internalfinancial controlswereoperatingeffectivelybasedon the internal control criteriaestablishedby theCompanyconsidering the essential components of internal control, stated in the Guidance Note on Audit of Internal Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India

ThedetailsinrespectofinternalfinancialcontrolandtheiradequacyareincludedintheManagementDiscussion& Analysis, which forms part of this report.

rISK mANAGEmENT POLICY:

Your Company has been following the principle of risk minimization vis a vis the industry norms.

A Risk Management Committee is in place and keeping in view the nature of business of the Company and the potential risks associated with it a Risk Management Policy is framed.

The Committee has been entrusted with the responsibility to assist the Board in (a) overseeing and approving the Company’s enterprise wide risk management framework and (b) overseeing that all the risks that the organization facessuchasfinancial, liquidity,security,property, IT, legal, regulatory,reputationalandotherriskshavebeenidentifiedandassessedandensuringthatthereisanadequateriskmanagementmechanisminplacecapableofaddressing those risks.

The policy aims at sustainable business growth with stability and to promote a pro-active approach in reporting, evaluating and resolving risks associated with the business.

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INTErNAL AudITOrS:

The Board of Directors based on the recommendation of the Audit Committee has re-appointed Mr. V. S. N. Srinivas, Chartered Accountant, Hyderabad, as the Internal Auditor of your Company. The Internal Auditor is submitting his report on quarterly basis.

STATuTOrY AudITOrS:

As the members are aware, at the Annual General Meeting (AGM) held on 25.09.2014, M/s GV & Co., Chartered Accountants,Hyderabad,wereappointedasourStatutoryAuditorsforaperiodof3years,toholdofficetilltheconclusion of the 32nd AGM. In terms of the provisions of Section 139 of the Companies Act, 2013, the appointment of the auditors shall be placed for ratification at everyAGM.Accordingly, the appointment ofM/sGV&Co.,CharteredAccountants,astheStatutoryAuditorsoftheCompany,isplacedforyourratification.Inthisregard,wehavereceivedconsentletterandcertificatefromtheauditorstotheeffectthatiftheyarereappointed,itwouldbein accordance with the provisions of Section 141 of the Companies Act, 2013.

Thestatutoryauditors’reportdoesnotcontainanyqualifications,reservationsoradverseremarks.

SECrETArIAL AudITOrS’ rEPOrT:

Pursuant to provisions of Section 204 of Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 we have obtained a Secretarial Audit report from Mr. Vikas Sirohiya, (M.No.15116 & C.P No. 5246),Partner, P. S. Rao & Associates, Company Secretaries, Hyderabad. The copy of said Report is attached herewith and marked as Annexure –I.

TRANSACTIONS WITH RELATED PARTIES

The Company has not entered into any transaction with any of its related parties falling under Section 188 of the CompaniesAct,2013.TherearenomateriallysignificantrelatedpartytransactionsmadebytheCompanywiththePromoters,Directors,KeyManagerialPersonneloranyrelatedpartywhichmayhaveapotentialconflictwiththe interest of the Company at large.

Related Party Transactions, if any are placed before the Audit Committee and the Board for approval.

Policy on Materiality of Related Party Transactions and on dealing with Related Party Transactions, as approved and adopted by the Board of Directors may be accessed on our Website at the link: http://www.vamaind.com/Policies/Related_Party_Transactions_Policy.pdf

Your kind attention is drawn to Note 30 to the Financial statement which sets out the Related Party disclosures.

QuALITY INITIATIVES

We continue to maintain successfully the Quality Management Systems to the requirements of ISO 9001:2008 Standards.

FIXEd dEPOSITS

We have neither accepted nor repaid any deposits during the FY ended 31st March, 2016. Further, there were no outstanding deposits as at the beginning of the FY or at any time during the FY 2016. Hence, there are no details to be provided pursuant to Rule 8 (5) (v) & (vi) of Companies (Accounts) Rules, 2014.

ANNuAL rETurN

In accordance with Section 134 (3) (a) of the Companies Act, 2013, an extract of the Annual Return in the prescribed Format i.e. Form MGT -9 is appended as Annexure –II to this Report.

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VIGIL MECHANISM / WHISTLE BLOWER POLICY

IntermsoftheprovisionsofSection177(9)&(10)ofCompaniesAct,2013andRegulation22ofSEBI(ListingObligations and Disclosure Requirements) Regulations, 2015, the Company has formalized the process and institutionalized ‘WhistleBlower Policy’ within the Company, whereby employees and other stakeholders can report matters such as generic grievances, corruption, misconduct, illegality and wastage/misappropriation of assets to the Company.

The policy safeguards the whistle blowers to report concerns or grievances and also provides direct access to the Chairman of the Audit Committee.

The details of the vigil mechanism are provided in the Corporate Governance Report and are set out in Annexure VIII to this Report. The Vigil Mechanism and Whistle Blower Policy may be accessed on our Website at the link:

http://www.vamaind.com/Policies/Vigil_Mechanism_Whistle_Blower_Policy.pdf

mANAGEmENT dISCuSSION ANd ANALYSIS

InaccordancewiththeprovisionsofSEBI(ListingObligationsandDisclosureRequirements)Regulations,2015,aReport on the Management Discussion and Analysis is set out in Annexure–III attached to this Report.

COrPOrATE GOVErNANCE:

We firmly understand and believe the importance of Corporate Governance. We always aim for the growthby adhering to the National and International Corporate Governance Standards. Our philosophy on corporate governanceensuresfiscalaccountability,ethicalcorporatebehaviorandfairnesstoallstakeholderscomprisingregulators, employees, customers, vendors, investors and the society at large.

For the sake of your information, it may be noted that the Paid up equity share capital of the Company was below Rs. 10 crores and Net worth was below Rs. 25 crores as on 31st March, 2016, hence as per Regulation 15 (2) of SEBI(ListingObligationsandDisclosureRequirements)Regulations,2015,certainprovisionsrelatingtoCorporateGovernance are not applicable to the Company. However, following the principles of good Corporate Governance in letter and spirit, we have complied with all the applicable provisions pertaining to Corporate Governance and have made disclosures at appropriate sections in this Annual Report.

AReportonCorporateGovernancealongwithacertificatefromourStatutoryAuditorsconfirmingcomplianceofconditionsofCorporateGovernanceasstipulatedintheerstwhileListingAgreement(totheextentapplicable)andalsounderSEBI(ListingObligationsandDisclosureRequirements)Regulations,2015formspartofthisAnnualReport.

E- DISPATCH OF ANNUAL REPORTS

While adhering to the Green Initiative measures, as suggested by the MCA, we have resolved to dispatch the Annual Reports electronically to such shareholders who have registered and updated their e-mail IDs. with the Registrar & Transfer Agents of the Company. Annual Report, in physical form shall be dispatched to other shareholders.

LISTING & TrAdING

OurEquitySharesarelistedonBSELimited,Mumbai.Thelistingfeesforthefinancialyear2016-17hasbeendulypaid.Youmayfurthernotethatthelisting/tradingwasneversuspendedatanytimeduringthefinancialyear2015-16.

PArTICuLArS OF EmPLOYEES

The information required pursuant to Section 197 read with Rule 5 (1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and as amended in respect of our employees, is attached herewith and marked as Annexure –V (i)

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WedoherebyaffirmthattheremunerationpaidisaspertheRemunerationPolicyforDirectors,KeyManagerialPersonnel and other Employees.

Further, we donot have any employee whose remuneration falls within the purview of the limits prescribed under the provisions of Section 197 of the Companies Act, 2013, read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and as amended i.e. Rs. 8.5 lakhs per month or Rs. 1.02 crores per annum.

Further,detailsoftoptenemployeesintermsofremunerationdrawnduringthefinancialyearended31stMarch,2016 as required under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and as amended is attached herewith and marked as Annexure- V (ii).

LOANS, GuArANTEES Or INVESTmENTS

We have not given any loan or made investment or given guarantee or provided security as envisaged under Section 186 of the Act.

DEMATRIALISATION OF SHARES

99.72%ofthetotalpaidupequitysharesofyourCompanyareindematerializedformason31stMarch,2016

dIrECTOrS rESPONSIBILITY STATEmENT

AsrequiredunderSection134(5)oftheCompaniesAct,2013,theDirectorsconfirmthat:

i. In the preparation of the Annual Accounts, the applicable Accounting Standards have been followed and that no material departures are made from the same ;

ii. The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the companyattheendoftheFinancialyearandoftheprofitsofthecompanyfortheperiod;

iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records inaccordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv. The annual accounts have been prepared on a going concern basis.

v. TheyhavelaiddowninternalfinancialcontrolstobefollowedbytheCompanyandthatsuchinternalfinancialcontrols are adequate and are operating effectively;

vi. They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

SIGNIFICANT OR MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant ormaterial orders passed by theRegulators /Courtswhichwould impact the goingconcern status of your Company and its future operations.

COrPOrATE SOCIAL rESPONSIBILITY:

SinceyourCompanydoesnotfallwithinanyoftheparametersspecifiedundertheprovisionsofSection135oftheCompanies Act, 2013 read with Rules made thereunder, reporting pursuant to Section 134(3) (o) is Not Applicable.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OuTGO

The Particulars as prescribed pursuant to the provisions of Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, are provided in Annexure – IV to this Report.

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GENErAL:

YourDirectorsstatethatduringthefinancialyearunderreview,therewerenocasesfiledpursuanttotheSexualHarassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

ACKNOWLEdGEmENTS ANd APPrECIATIONS

Your Directors appreciate contribution made by the employees of the Company and acknowledge their hard work and dedication to ensure that the Company consistently performs well and remains a consistent player in the IT & ITES Industry. The Board of Directors wish to express their sincere appreciation and thanks to all customers, suppliers,banks,financial institutions,solicitors,advisors,GovernmentofIndia,concernedStateGovernmentsand other authorities for their consistent support and co-operation towards contributing to the Company’s success.

Wearealsodeeplygratefultoourshareholdersfortheconfidenceandfaiththattheyhavealwaysplacedinus.

For and on behalf of the Board


12th August, 2016Hyderabad

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Annexure – I SECrETArIAL AudIT rEPOrT

For the Financial Year ended March 31, 2015[Pursuant to Section 204(1) of the Companies Act, 2013 and Rule No.9 of the Companies (Appointment and

Remuneration Personnel) Rules, 2014]

To,The Members,VAMAINDUSTRIESLIMITEDHyderabad

We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to goodcorporatepracticesbyVAMAINDUSTRIESLIMITED,(hereinaftercalledthe“Company”).SecretarialAuditwas conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing our opinion thereon.

BasedonourverificationoftheCompany’sbooks,papers,minutesbooks,formsandreturnsfiledandotherre-cordsmaintainedbytheCompanyandalsotheinformationprovidedbythecompany,itsofficers,agentsandau-thorized representatives during the conduct of secretarial audit, we hereby report that in our opinion , the Company has,duringtheauditperiodcoveringthefinancialyearendedon31stMarch,2016compliedwiththestatutoryprovisions listed hereunder and also that the Company has proper Board-processes and compliance mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

Wehaveexaminedthebooks,papers,minutebooks,formsandreturnsfiledandotherrecordsmaintainedbyVAMAINDUSTRIESLIMITED(“theCompany”)andmadeavailable tous for thefinancialyearendedon31stMarch, 2016 according to the provisions of:

i. The Companies Act, 2013 (the Act) and the rules made thereunder.

ii. The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made thereunder;

iii. The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;

iv. Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment. (during the period under audit there was no transaction pertaining to Overseas Direct Investment or External Commercial Borrowings)

v. The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’):-

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regu-lations, 2011;

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992; (upto 14th May, 2015)

(c) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015; (w.e.f 15th May, 2015)

(d) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regu-lations, 2009; (in connection with issue of securities on preferential basis pursuant to Chapter VII thereof)

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(e) TheSecuritiesandExchangeBoardofIndia(ShareBasedEmployeeBenefits)Regulations,2014;(Not applicable to the Company during the audit period);

(f) TheSecuritiesandExchangeBoardofIndia(IssueandListingofDebtSecurities)Regulations,2008;(Not applicable to the Company during the audit period)

(g) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client;

(h) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; (Not ap-plicable to the Company during the audit period); and

(i) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998; (Not appli-cable to the Company during the audit period);

(j) TheSecuritiesandExchangeBoardofIndia(ListingObligationsandDisclosureRequirements)Reg-ulations, 2015; (w.e.f. 1st December, 2015)

We have also examined compliance with the applicable clauses of the following:

i. ListingAgreemententeredintobytheCompanywithBSELtd.

ii. Secretarial Standards issued by the Institute of Company Secretaries of India (w.e.f. 1st July, 2015

During the period under review, the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards, etc. mentioned above, except that the Annual Re-port for the FY ended 31.03.2015 was submittedlatetoBSE(Clause31oftheerstwhileListingAgreement).TheCompanypaidthefineleviedforthesaiddelay.Therewassomedelayob-servedinfilingofFormswiththeRegistrarofCompanies.

We further report that, having regard to the compliance system prevailing in the Company and on examination of the relevant documents and records in pursuance thereof on test-check ba-sis, the Company has complied with thefollowinglawsapplicablespecificallytotheCompany.

a) Software Technology Parks of India rules and regulations;

b) The Trade Marks Act, 1999.

We further report that :

The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-Execu-tive Directors and Independent Directors. The changes in the composition of the Board of Directors that took place during the period under review were carried out in compliance with the provisions of the Act.

Adequate notice is given to all directors to schedule the Board Meeting, agenda and detailed notes on agenda were sent at least seven days in advance, and a system exists for seeking and obtaining further information and clarificationsontheagendaitemsbeforethemeetingandformeaningfulparticipationatthemeeting.

As per the Minutes of the Meetings duly recorded and signed by the Chairman, the decisions of the Board were unanimous and there were no dissenting views to be recorded as such.

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We further report that :

• thereareadequatesystemsandprocessesinthecompanycommensuratewiththesizeandopera-tions of the company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.

• duringtheauditperiodexcepttheissueandallotmentof12,20,000equitysharesofRs.10eachand4,50,000convertiblewarrantsonpreferentialbasis,therewerenosuchspecificevents/actionshav-ing a major bearing on the company’s affairs in pursuance of the above referred laws, rules, regula-tions, guidelines, standards, etc.

For P S Rao & Associates Company Secretaries

Sd/- Vikas Sirohiya Partner M. No.: 15116 C.P. No.: 5246

[This Report is to be read with our letter of even date which is annexed as Annexure A and forms an integral part of this report.]

Place : HyderabadDate: 12th August, 2016

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‘Annexure A’

To,The Members,VAMAINDUSTRIESLIMITED,Ground Floor, B12, Madhura Nagar Hyderabad-500038

Secretarial Audit Report of even date is to be read along with this letter.

Management’s Responsibility

1. It is the responsibility of the management of the Company to maintain secretarial records, devise proper systems to ensure compliance with the provisions of all applicable laws and regulations and to ensure that the systems are adequate and operate effectively.

Auditor’s Responsibility

2. Our responsibility is to express an opinion on these secretarial records, standards and procedures followed by the Company with respect to secretarial compliances.

3. We believe that audit evidence and information obtained from the Company’s management is adequate and appropriate for us to provide a basis for my opinion.

4. Wherever required, we have obtained the management’s representation about the compliance of laws, rules and regulations and happening of events etc.

disclaimer

5. The Secretarial Audit Report is neither an assurance as to the future viability of the Company nor of the ef-ficacyoreffectivenesswithwhichthemanagementhasconductedtheaffairsoftheCompany.

For P S Rao & Associates Company Secretaries

Sd/- Vikas Sirohiya Partner M. No.: 15116 C.P. No.: 5246Place : HyderabadDate: 12th August, 2016

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Annexure-IIFORM NO. MGT-9

EXTrACT OF ANNuAL rETurNAs on the financial year ended on 31.03.2016

[Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of theCompanies (Management and Administration) Rules, 2014)

I. REGISTRATION & OTHER DETAILS:

i. CIN L72200TG1985PLC041126ii. Registration Date 13.03.1985iii. NameoftheCompany VAMAINDUSTRIESLIMITEDiv. Category/Sub-CategoryoftheCompany PublicLimitedCompany/LimitedbySharesv. AddressoftheRegisteredoffice Ground Floor, B-12,Madhura Nagar, Hyderabad – 500038 and Contact Details E-mail ID: [email protected] Ph. No : 040-66845534 Web Site: www.vamaind.comvi. WeatherListedCompany Yes

vii. Name,AddressandContactdetailsof BigshareServicesPvt.Ltd Registrar and Transfer Agent 306, 3rd Floor, Right Wing, Amrutha Ville Opp. Yashoda Hospital, Raj Bhavan Road, Somajiguda ,

Hyderabad- 500082. Mobile: 9848098088

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

AlltheBusinessactivitiescontributing10%ormoreofthetotalturnoveroftheCompanyshallbestated:

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

1 IT, ITES and Software Consulting Sale of Hardware & Software, Installationsupport&Maintenance4651&6202 100%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES : N.A.

S. No Name and Address CIN/GLN Holding/Subsidiary % of Shares Applicable of the Company /Associate held Section

28

IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity): i. Category-wise Share HoldingCategoryof No.ofSharesheldatthe No.ofSharesheldatthe %ChangeShareholders beginning of the year end of the year during the year Demat Physical Total %of Demat Physical Total %of (II-I) Total Total Shares Shares (I) (II)A. Promoters1. Indians a) Individual/HUF 3912366 0 3912366 47.49 4212366 0 4212366 43.17 -4.32b) Central Govt c) State Govt d) Bodies Corporate e) Banks/FI f) Any other Sub Total (A) (1) 3912366 0 3912366 47.49 4212366 0 4212366 43.17 -4.322. Foreign a) NRI – Individuals b) Other Individuals c) Bodies Corporate d) Banks / FI e) Any other Sub Total (A) (2) Total Shareholding of Promoter A= (A)(1) + (A)(2) 3912366 0 3912366 47.49 4212366 0 4212366 43.17 -4.32 B. Public Shareholding 1. Institutions a) Mutual Funds 0 0 0 0 0 0 0 0b) Banks / FI 0 0 0 0 0 0 0 0c) Central Govt. 0 0 0 0 0 0 0 0d) State Govt. 0 0 0 0 0 0 0 0e) Venture Capital Funds 0 0 0 0 0 0 0 0f) Insurance Companies 0 0 0 0 0 0 0 0g) FIIs 0 0 0 0 0 0 0 0h) Foreign Venture Capital Funds 0 0 0 0 0 0 0 0

i) Others 0 0 0 0 0 0 0 0

Sub Total (B) (1) 0 0 0 0 0 0 0 0 0

29

Categoryof No.ofSharesheldatthe No.ofSharesheldatthe %ChangeShareholders beginning of the year end of the year during the year Demat Physical Total %of Demat Physical Total %of (II-I) Total Total Shares Shares (I) (II)2. Non Institutions a) Bodies Corp. i) Indian 1131330 5500 1136830 13.80 1090541 5500 1096041 11.23 -2.57ii) Overseas b) Individuals i) Individual shareholders holding nominal share capital upto Rs. 1 lakh 859816 22022 881838 10.70 1000042 22022 1022064 10.47 -0.23ii) Individualshareholdersholdingnominal share capital in excess of Rs 1 lakh 2300230 0 2300230 27.92 2528494 0 2528494 25.91 -2.01c) Others 6736 0 6736 0.08 899035 0 899035 9.21 9.13Sub-total (B) (2) 4298112 27522 4325634 52.51 5518112 27522 5545634 56.83 4.32Total Public Shareholding (B)=(B)(1)+(B)(2) 4298112 27522 4325634 52.51 5518112 27522 5545634 56.83 4.32 C. Shares held by Custodian for Gdrs & Adrs 0 0 0 0 0 0 0 0 0 Grand Total (A+B+C) 8210478 27522 8238000 100.00 9730478 27522 9758000 100.00 -

30

ii) Shareholding of Promoter

S Shareholders Shareholdingatthe Shareholdingatthe %Changein No Name beginning of the year end of the year shareholding during the year Noof %oftotal %ofShares Noof %oftotal %ofShares Shares shares Pledged/ Shares Shares of Pledged/ of the encumbered the encumbered company to total shares company to total shares

1. V.A. Rama Raju 2061024 25.02 NA 2211024 22.65 NA -2.37

2. V. Rajam Raju 1160500 14.09 NA 1160500 11.89 NA -2.20

3. G.A. Rama Raju 599442 7.28 NA 599442 6.14 NA 1.14

4. Bangarraju Mudundi 18000 0.22 NA 18000 0.18 NA -0.04

5. V. Sarada 17000 0.21 NA 17000 0.17 NA -0.04

6. M. Krishnaveni 16800 0.20 NA 16800 0.17 NA -0.03

7. V. Pushpavathi 14000 0.17 NA 14000 0.14 NA -0.03

8. Mohan RajuIndukuri 10700 0.13 NA 10700 0.10 NA -0.03

9. Uma VaniInduikuri 10000 0.12 NA 10000 0.10 NA -0.02

10. Parvathi Vegesna 4900 0.06 NA 154900 1.58 NA 1.52

TOTAL 3912366 47.49 NA 4212366 43.16 NA -4.33

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

Sl. No Particulars Date Reason Shareholding at the Cumulative beginning of the year Shareholding during the year

1.V.A.RamaRaju No.of %oftotal No.of %oftotal shares shares of shares shares of the company the company

At the beginning 2061024 25.02 of the year

Changes During the year 10.09.2015 Acquired 300000 3.07 2361024 24.19 by way conversion of Warrants

03.12.2015 Transfer by (150000) 1.54 2211024 22.65 way of gift

At the end of the year 2211024 22.65

31

Sl. No Particulars date reason Shareholding at the Cumulative beginning of the year Shareholding during the year

2. Parvathi Vegesna No. of % of total No. of % of total shares shares of shares shares of the company the company


Changes During the year 03.12.2015 Transfer 150000 1.54 154900 1.58 by way of gift


Note: There was no change in the shareholding of promoters, other than those mentioned above. The shareholding details of Promoters are mentioned at Para IV (ii) above.

iv) Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and Adrs):


1.AnilUnnikrishnan No.of %oftotal No.of %oftotal shares shares of shares shares of the company the company

At the beginning Nil Nil of the year

Changes During the year 10.09.2015 Preferential 890000 10.80 Allotment



2.NirantTechnologies No.of %oftotal No.of %oftotal Pvt.Ltd. shares sharesof shares sharesof the company the company


Changes During the year Nil Nil Nil Nil

At the end of the year 5,00,000 5.12

32


3.SainarenProperties No.of %oftotal No.of %oftotal Pvt.Ltd. shares sharesof shares sharesof the company the company





4.NITINSIDDAMSETTY No.of %oftotal No.of %oftotal shares shares of shares shares of the company the company

At the beginning Nil Nil of the year

Changes During the year 10.09.2015 Preferential 330000 4.00 Allotment



5.VVSMURTY No.of %oftotal No.of %oftotal shares shares of shares shares of the company the company




33


6.SUBBARAOVITAKULA No.of %oftotal No.of %oftotal shares shares of shares shares of the company the company





7.T.VenkataAppaRao No.of %oftotal No.of %oftotal shares shares of shares shares of the company the company


Changes During the year 31.03.2016 Sale (100000) 1.02 45089 0.46



8.VenuGopalaRaju No.of %oftotal No.of %oftotal Vegesna shares shares of shares shares of the company the company


Changes During the year 24.04.2015 Sale (3) 0.00 141439 1.72 01.05.2015 Sale (1) 0.00 141438 1.72 08.05.2015 Buy 5600 0.05 147038 1.78 15.05.2015 Sale (630) 0.01 146408 1.77 22.05.2015 Sale (2000) 0.02 144408 1.75 19.06.2015 Sale (3000) 0.03 141408 1.71 20.11.2015 Sale (3000) 0.03 138408 1.41 04.12.2015 Buy 3000 0.03 141408 1.45 04.03.2016 Sale (1255) 0.01 140153 1.44 At the end of the year 140153 1.44

34


9.V.Chandravati No.of %oftotal No.of %oftotal shares shares of shares shares of the company the company


Changes During the year 24.04.2015 Sale (677) 0.01 133253 1.61 18.03.2016 Buy 1000 0.01 134253 1.38 At the end of the year 134253 1.38


10.VenkataKakumanu No.of %oftotal No.of %oftotal Krishna Rao shares shares of shares shares of the company the company

At the beginning of the year 106950 1.30




11.CHANDRAMOULI No.of %oftotal No.of %oftotal T B V P shares shares of shares shares of the company the company

At the beginning of the year Nil Nil

Changes during the Year 05.02.2016 Buy 539 0.01 539 0.01

04.03.2016 Sale (136) 0.00 403 0.01

31.03.2016 Buy 100000 1.02 100403 1.03


35


12.KRISHNAPRASAD No.of %oftotal No.of %oftotal SIVARAMAATLURI shares sharesof shares sharesof the company the company





13.BHANUPRAKASH No.of %oftotal No.of %oftotal VANKINENI shares shares of shares shares of

the company the company




36

v) Shareholding of directors and Key managerial Personnel:


1. V.A.RamaRaju No.of %oftotal No.of %oftotal shares shares of shares shares of the company the company


Changes During the year 10.09.2015 Acquired 300000 3.07 2361024 24.19 by way of conversion of Warrants

03.12.2015 Transfer by way (150000) 1.54 2211024 22.65 of gift



2.V.RajamRaju No.of %oftotal No.of %oftotal shares shares of shares shares of the company the company





3.Venkateshwara No.of %oftotal No.of %oftotalRao Raparla shares of shares shares of shares

the company the companyAt the beginning of the year 700 0.01

ChangesDuringtheyear NIL NIL NIL NIL


37


4.RamaKrishnaRaoVarada No.of %oftotal No.of %oftotal shares shares of shares shares of the company the company

At the beginning of the year 200 Negligible


At the end of the year 200 Negligible


5.K.VaraPrasadRaju No.of %oftotal No.of %oftotal shares shares of shares shares of the company the company

At the beginning of the year 300 Negligible


At the end of the year 300 Negligible


6.RamaSravanthiRambatla No.of %oftotal No.of %oftotal shares shares of shares shares of the company the company

Atthebeginningoftheyear NIL NIL

ChangesDuringtheyear NIL NIL

Attheendoftheyear NIL NIL

38


7.GavireddySiva No.of %oftotal No.of %oftotal shares shares of shares shares of the company the company





8.ShilpaKotagiri No.of %oftotal No.of %oftotal Resigned w.e.f. 10.09.2015 shares shares of shares shares of the company the company





9.RohitTibrewal No.of %oftotal No.of %oftotal Appointed w.e.f shares shares of shares shares of 10.09.2015 the company the company




39

V. INdEBTEdNESSIndebtedness of the Company including interest outstanding/accrued but not due for payment

Secured Loans unsecured deposits Total excluding deposits Loans Indebtedness

Indebtedness at the beginning of the financial yeari) Principal Amount 4,88,80,194 - - 4,88,80,194

ii) Interest due but not paid - - - -

iii) Interest accrued but not due 21,960 - - 21,960

Total ( i +ii+iii) 4,89,02,154 - - 4,89,02,154Change in Indebtedness

duringthefinancialyear

Addition 88,01,352 1,45,46,346 - 2,33,47,698

Reduction - - - -

Net Change 88,01,352 1,45,46,346 - 2,33,47,698Indebtedness at the end of the financial year i) Principal Amount 5,76,81,546 1,45,46,346 - 7,22,27,892

ii) Interest due but not paid - - - -

iii) Interest accrued but not due - 1,94,567 - 1,94,567

Total ( i +ii+iii) 5,76,81,546 1,47,40,913 - 7,24,22,459

40

VI. rEmuNErATION OF dIrECTOrS ANd KEY mANAGErIAL PErSONNEL

A. Remuneration to Managing Director, Whole-time Directors and/or Manager:

Sl. No Particulars of remuneration Name of md/WTd/ Total Amount manager

md: V. A. rama raju WTd: V. rajam raju

1 Gross salary 19,80,000 18,00,000 3780000

a Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961 19,80,000 18,00,000 3780000

b Value of perquisites u/s 17(2) Income-taxAct,1961 NIL NIL NIL

c Profitsinlieuofsalaryunder section17(3)Income-taxAct,1961 NIL NIL NIL

2 StockOption NIL NIL NIL

3 SweatEquity NIL NIL NIL

4 Commission

-as%ofprofit NIL NIL NIL

-others NIL NIL NIL

5 Others NIL NIL NIL

Total 19,80,000 18,00,000 3780000

Ceiling as per the Act 42,00,000 42,00,000

B. remuneration to other directors:

NoneoftheDirectorsoftheCompanyotherthanasmentionedabovewaspaidanyremunerationduringthefinancialyear.

41

C. remuneration to Key managerial Personnel other than md/manager WTd:

Sl. No Particulars of Key managerial Personnel Total remuneration

Shilpa Kotagiri Rohit Tibrewal Gavireddy Siva (Company Secretary) (Company Secretary) (CFO)

1. Gross salary 88,000 3,32,420 8,64,000 12,84,420 (a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961 88,000 3,32,420 8,64,000 (b) Value of perquisites u/s 17(2) Income-tax Act, 1961 Nil Nil Nil Nil (c)Profitsinlieuofsalaryunder section 17(3) Income-tax Act, 1961 Nil Nil Nil Nil2. Stock Option Nil Nil Nil Nil3. Sweat Equity Nil Nil Nil Nil4. Commission Nil Nil Nil Nil -as%ofprofit Nil Nil Nil Nil -others Nil Nil Nil Nil

5. Others Nil Nil Nil Nil Total 88,000 3,32,420 8,64,000 12,84,420

Note: i) Mrs. Shilpa Kotagiri resigned as Company Secretary on 10.09.2015ii) Mr. Rohit Tibrewal appointed as Company Secretary on 10.09.2015The salary disclosed above corresponds to the period as mentioned. VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES: NIL

Type Section of the Brief details of Authority Appeal Companies Act description Penalty / [rd / NCLT made, if any Punishment/ / COURT] (give Details) Compounding fees imposed A. COmPANYPenalty Nil Nil Nil Nil NilPunishment Nil Nil Nil Nil NilCompounding Nil Nil Nil Nil NilB. dIrECTOrSPenalty Nil Nil Nil Nil NilPunishment Nil Nil Nil Nil NilCompounding Nil Nil Nil Nil Nil

C. OTHER OFFICERS IN DEFAULTPenalty Nil Nil Nil Nil NilPunishment Nil Nil Nil Nil NilCompounding Nil Nil Nil Nil Nil

42

Annexure-IIImanagement discussion and Analysis report

This Management Discussion and Analysis Report addresses the expectations and Projections of the company for its future, about its Product Development, Market Position, Market Development and Penetration, Expenditure, Financial Results, Risks and Concerns etc. However, the expectations shared herein are not limited to the Compa-ny’s Growth. The Company’s actual results, performance or achievements could differ from those shared herein.

Ontheotherhand,ourManagementdeclaresthat,thefinancialstatementshavebeenpreparedincompliancewith the requirements of the Companies Act, 2013 and Rules made thereunder, guidelines issued by the Securities Exchange Board of India (SEBI) and the Generally Accepted Accounting Principles (GAAP) in India.

A. Industry Structure and developments

India is the topmost offshoring destination for IT companies across the world. Having proven its capabilities in delivering both on-shore and off-shore services to global clients, emerging technologies now offer an entire new gamutofopportunitiesfortopITfirmsinIndia.Social,Mobility,AnalyticsandCloud(SMAC)arecollectivelyex-pected to offer a US$ 1 trillion opportunity. Cloud represents the largest opportunity under SMAC, increasing at a CAGR of approximately 30 per cent to around US$ 650-700 billion by 2020. The social media is the second most lucrativesegmentforITfirms,offeringaUS$250billionmarketopportunityby2020.TheIndiane-commerceseg-ment is US$ 12 billion in size and is witnessing strong growth and thereby offers another attractive avenue for IT companies to develop products and services to cater to the high growth consumer segment.

Quality Service & Customer Care

VAMA is very focused on Engineering; IT & IT enabled services. We are very keen on our industry expertise and ensure specialized support for our clients. Therefore, we continually evaluate and train our professionals in new technologies and methodologies.

Technology businesses looking to grow should also strive to work more collaboratively with their customers to truly understand the core challenges they are facing. This insight will help them to better communicate how their products and services can deliver greater value to their customers.

B. Financial Information

1. Sources of Funds

Currently, we have only one class of shares i.e., Equity Shares of nominal value Rs. 10/- each. Our Authorised Share Capital is Rs. 11,00,00,000 divided into 1,10,00,000 equity shares of Rs. 10/- each. The Issued, Subscribed and Paid Up capital stood at Rs. 9,75,80,000 divided into 97,58,000 equity shares of Rs. 10/- each as at March 31, 2016 (Rs 8,23,80,000 previous year).

2. Profit & Loss Account

ThebalanceretainedintheProfit&LossaccountasatMarch31,2016isRs.8,81,580/-afterprovidingforfinaldividend for theyearofRs.10,50,800/-andDividendTaxofRs.2,13,917/- thereon.The totalamountofprofitsproposed to be appropriated towards dividend and Dividend tax is Rs.12,64,717/-

3. Deferred Tax Assets/ Liabilities

WerecordednetDeferredTaxAssetsofRs7,30,026/-asatMarch31,2016(PreviousYearDeferredTaxLiabilitiesof Rs 3,93,993)

43

4. Fixed Assets

During theyear, thenetblockof thefixedassetsasat31stMarch2016 isRs.4,07,60,209/-ascompared toRs.13,017,337/- in the previous year.

5. Investments

The Company has not made any investments during the year.

C. results of Operations

1. Income

OfthetotalrevenuesfortheyearendedMarch31,2016approximately3.11%werederivedfromouroverseasoperationswhereas96.89%werereceivedfromdomesticoperations.

Ourrevenuesaresegmentedas100%EOU,DomesticandotherIncome.

100%EOURevenuesareforthoseserviceswhichareperformedatourSoftwareDevelopmentCenterlocatedinIndia (offshore revenues) towards IT & ITeS on the other hand domestic revenues are those revenues that are a result of IT Infrastructure Solution Services, trading in hardware products, and related services, consultancy and projects

2015-16 2014-15100% Export Oriented unit Services

IT Services 143.02 58.08domestic Services

Services/Consultancy/ Projects 303.62 483.94Computers & Peripherals 4139.72 4310.89Other Income 15.61 16.77Total 4601.97 4869.68 2. Expenditure 2015-16 2014-15Cost of Product and Services 3898.20 3980.83

EmployeebenefitExpenses 344.40 347.91

Financial Charges 75.95 65.71

Depreciation amortization expenses 24.34 30.50

Other Expenses 218.26 293.25

Total 4561.15 4718.20

Costofproducts&servicesmentionedaboveisnetofthechangesininventoriesoffinishedgoods,workinprog-ress and stock-in-trade.

( ` inLakhs)

( ` inLakhs)

44

d. Outlook Scope:Technology is the backbone of the digital economy. The rate of change and the level of disruption driven by modern technology are exponential. Advancements in computer processing power, data storage, and chip design; the ubiquity of bandwidth; enterprise mobility; and many other developments that have unfolded in recent years are enabling myriad opportunities that were once impossible, both technologically and economically.

Now, we have reached a tipping point where cognitive computing, big data analytics, cloud computing, and the rapidly growing Internet of Things (IoT) are transforming businesses around the globe—including those outside the technology sector.

Competition: We are operating in a highly competitive and rapidly changing market. In future, we expect competi-tionfromcompaniesestablishingandbuildingtheiroffshorepresenceandfirmsincountrieswithlowerpersonnelcosts than those prevailing in India apart from those who are strongly established. However, we understand that pricealonecannotconstituteasustainablecompetitiveadvantage.Weareconfidenttocompetefavorablywithrespect to these factors.

E. risks, Threats and Concerns

In this section, we are disclosing the risks and concerns of the company.

Theindustry,specificallytheITServicessectorisexposedtothefollowingriskfactors:Variationsinglobaldemandgrowthwouldpresentitselfasasignificantriskfactorastheindustryispredominantlyexportdriven(accountingfor21%ofrevenues).USmarketaccountsfor60%oftherevenues.Theindustryisexposedtorisksduetothisdependency.Currencyriskswillcontinuetobeacauseofconcern.Anannualisedrupeeappreciationof5.5%couldresultinadecreaseinrevenuegrowthfrom21%to15%.Availabilityofqualityhumanresource,andabilityto innovate would present themselves as risks. Increasing protectionism in US and EU could present itself as a major risk factor. Threats of terrorist attacks, pandemics, and other force majeure events also present themselves as risks in the current geo-political context. Other countries such as Brazil, China, Philippines, Vietnam, Czech Republic, Ireland, and Malaysia could eat into India’s pie.

In addition to risk factors mentioned above, data theft and information security present themselves as serious reputation risks for companies in the industry. Additionally, the industry is also prone to regulatory risks as a result of the need for outsourcing service providers to comply with various regulations of different countries.

Government & Compliance:

Legislationincertaincountriesmayrestrictthecompanyfromoutsourcingworktous.IncreasingcomplianceinIndia and abroad is increasing the costs of compliance. Our increasing work with governmental agencies may expose us to additional risks. The income can also be affected if the Government of India or the government of another country changes its tax policies in a manner that is adverse to us. Our ability to acquire companies orga-nized outside India depends on the approval of the Government of India and/or Reserve Bank of India, and failure to obtain permissions and approval could adversely impact our business.

Human Resources / Industrial Relations:

Increasing cost of employees may affect the margins of the company. In addition, our services demand highly skilled technology professionals and our ability to hire, attract, motivate, retain and train our personnel are de-manding higher cost. However, the human resource strategy enabled the Company to attract, integrate, develop and retain the best talent required for driving business growth.

The Company continues to maintain cordial relationship with all its employees.

45

Number of People Employed:

As on 31st March 2016, the employee strength was 153.

Customers & Clients:

Our client’s contracts are often conditioned upon our performance, which if unsatisfactory, may result in fewer rev-enues. Our engagements with customers are singular in nature and may not necessarily provide for subsequent engagements. Some of our long term client contracts contain certain provisions which, if triggered, could result in lowerfuturerevenuesandprofitabilityunderthecontract.Thismeansthat,ourclientscontractscanbeterminatedany time without cause. This could certainly affect the business negatively. On the other hand, our business will suffer if we fail to anticipate and develop new services and enhance existing services in order to keep pace with rapid changes in technology and in the industry on which we focus.

F. Segment-Wise Performance

As of March 31, 2016, our main reportable segments are Software Development &Services (IT &ITeS) and Prod-uct/ Hardware Sales & Services.

Profitability (`inLakhs)Particulars Year ended march 31, Growth%

2016 2015

Earnings before 141.11 229.81 (38.59) Interest, Depreciation and Tax (EBIDTA) Interest 75.95 47.82 58.82Depreciation 24.34 30.50 (20.19)Profit Before Tax and Exceptional Items 40.82 151.48 (73.05)Exceptional Item - 52.7 -Profit Before Tax 40.82 98.78 (58.67)Tax 15.71 48.59 (67.66)Profit for the year 25.11 50.19 (49.97)

G. Internal Control Systems and Their AdequacyTheCEOandCFOCertification,issuedpursuanttotheprovisionsofClause49oftheListingAgreementandSEBI(ListingObligationsandDisclosureRequirements)Regulations,2015isprovidedintheAnnualreportwhichshalldiscuss the adequacy of VAMA’s Internal Control Systems and Procedures.

The internal control systems adopted by the Company are adequate and appropriate to its operations. The system has been designed to ensure that assets and interest of the Company are protected and dependability of account-ing data and its accuracy are ensured with proper checks and balances.

The Company has appointed V.N.S. Srinivas Rao, to oversee and carry out an internal audit of the Company’s activities. The audit is based on an Internal Audit Plan, which is reviewed each year in consultation with the Statu-tory Auditors and the Audit Committee.

46

The Internal Audit process is designed to review the adequacy of internal control checks in the system and covers allsignificantareasoftheCompanyoperations.TheCompanyhasanAuditCommittee,thedetailsofwhichhavebeen provided in the Corporate Governance Report. The Audit Committee reviews audit reports submitted by the Internal Auditors.

The Company’s Audit committee meets the Company’s Statutory Auditors to ascertain their views on the adequacy of Internal Control Systems in the Company and keeps the Board of Directors informed of its major observations at periodic intervals.

47

Annexure - IV

CONSERVATION OF ENERGY, RESEARCH & DEVELOPMENT, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/ OUTGO:

Particulars as prescribed under Section 134 (3) (m) of the Companies Act, 2013 read with the Companies (Ac-counts) Rules, 2014 are as follows:

A. Conservation of Energy : Not Applicable

i. the steps taken or impact on conservation of energy; ii. the steps taken by the company for utilizing alternate sources of energy; iii. the capital investment on energy conservation equipments;

B. Technology Absorption : Not Applicable

i. the efforts made towards technology absorption; ii. thebenefitsderivedlikeproductimprovement,costreduction,productdevelopmentorimportsub-

stitution; iii. in case of imported technology (imported during the last three years reckoned from the beginning of

thefinancialyear)-

(a) the details of technology imported; (b) the year of import; (c) whether the technology been fully absorbed; (d) if not fully absorbed, areas where absorption has not taken place, and the reasons

thereof; and

iv. the expenditure incurred on Research and Development.

C. Foreign Exchange inflow and Outflow during the year :

i. ForeignExchangeinflow :92.41Lakhs ii. ForeignExchangeOutflow :794.36Lakhs

For and on behalf of the Board


12th August, 2016Hyderabad

48

Annexure – V(i)

Information pursuant to Section 197 read with Rule 5 (1) of The Companies (Appointment and remuneration of managerial Personnel) rules, 2014 in respect of our employees

A. The ratio of the remuneration of each director to the medianemployees remuneration and other details in terms of sub section 12 of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and amendments thereto.

(Rs in lakhs)Sr. Name of Director / Financial Year 2015-16No. KMP and Designation Remuneration %increasein Ratioof of Director / KMP Remuneration Remuneration of each Director to median remuneration of employees

1 Mr. V.A Rama Raju (Chairman & Managing Director) 19.80 Nil 11.38

2 Mr.V Rajam Raju (Executive Director) 18.00 Nil 10.34 3 Mr. R. Venkateshwara Rao (Independent Director) Nil Nil Nil

4 Mr. V. Rama Krishna Rao (Independent Director) Nil Nil Nil

5 Mr. V. Prasad Raju (Independent Director) Nil Nil Nil

6 Ms.Rama Sravanthi Rambatla (Non-Executive Director) Nil Nil Nil

7 Mr. Gavireddy Siva (CFO) 8.64 Nil N.A

8 Ms. Shilpa Kotagiri (Company Secretary) 0.88 Nil N.A (Upto 10.09.2015)

9 Mr. Rohit Tibrewal (Company Secretary) (from 10.09.2015) 3.32 Nil N.A

B. Percentage Increase in the median remuneration of all employees in the Financial Year 2015-16 :

ThemedianannualremunerationofemployeesoftheCompanyduringthefinancialyearwasRs.1.74lakh.Inthefinancialyear,therewasanincreaseof7.01%inthemedianremunerationofemployees.

49

C. Number of permanent employees on the rolls of Company as on 31st March 2016

There were 153 permanent employees on rolls of the Company as on March 31, 2016

d. Average percentile increase already made in the salaries of the 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 managerial remuneration.

Average percentile increase already made in the salaries of the employees other than the managerial personnelinthelastfinancialyeari.e2014-15was19.85%whereastherewasnochangeinthemanagerialremunerationforthesaidfinancialyear.ThesaidincreaseintheremunerationwasintunewiththeCompany’spolicy and in normal course of business.

E. Affirmation that the remuneration is as per the remuneration Policy of the Company:

Yes,itisherebyaffirmedthattheremunerationisaspertheremunerationPolicyoftheCompany:

50

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52

Annexure - VI Policy for selection of directors and determining directors Independence

1. Introduction:

1.1 VamaIndustriesLimited(VAMA)believesthatanenlightenedBoardconsciouslycreatesacultureofleader-ship to provide a long-term vision and policy approach to improve the quality of governance. Towards this, VAMAensuresconstitutionoftheBoardofDirectorswithrequiredcomposition,diversifiedexpertiseandexperience and commitment to discharge their responsibilities and duties effectively.

1.2 VAMA recognizes the importance of Independent Directors in achieving the effectiveness of the Board.

2. Scope:

2.1 This Policy sets out the guiding principles for the Nomination and Remuneration Committee for identifying personswhoarequalifiedtobecomeDirectorsandtodeterminetheindependenceofDirectors,incaseoftheir appointment as Independent Directors of the Company.

3. Terms and references:

In this Policy, the following terms shall have the following meanings:

3.1 “Director” means a Director appointed to the Board of the Company.

3.2 “NominationandRemunerationCommittee”meansaCommitteeconstitutedbyVamaIndustriesLimited’sBoard in accordance with the provisions of Section 178 of the Companies Act, 2013.

3.3 “Independent Director” means a Director referred to in sub-section (6) of Section 149 of the Companies Act, 2013.

4. Policy:

4.1 QualificationsandCriteria

4.1.1 The Nomination and Remuneration (NR) Committee and the Board shall review on an annual basis, appro-priate skills, knowledge and experience required of the Board as a whole and its individual members. The objective is to have a Board with diverse background and experience that are relevant for the Company’s operations.

4.1.2 In evaluating the suitability of individual Board members, the Nomination and Remuneration Committee

may take into account factors, such as:

• GeneralunderstandingoftheIndustryvisavisCompany’sbusinessperspective;• Educationalandprofessionalbackground• Standingintheprofession;• Personalandprofessionalethics,integrityandvalues;• Willingnesstodevotesufficient timeandenergy incarryingout theirdutiesandresponsibilitieseffec-

tively.

53

4.1.3Theproposedappointeeshallalsofulfillthefollowingrequirements:

• ShallpossessaDirectorIdentificationNumber;• ShallnotbedisqualifiedundertheCompaniesAct,2013;• ShallgivehiswrittenconsenttoactasaDirector;• ShallendeavourtoattendallBoardMeetingsandwhereverheisappointedasaCommitteeMember,

the Committee Meetings; • ShalldisclosehisconcernorinterestinanyCompanyorCompaniesorBodiesCorporate,Firmsinclud-

inghisshareholdingatthefirstmeetingoftheBoardineveryfinancialyearandthereafterwheneverthere is a change in the disclosures already made;

• Suchotherrequirementsasmaybeprescribed,fromtimetotime,undertheCompaniesAct,2013andother relevant laws.

4.1.4 The NR Committee shall evaluate each individual with the objective of having a group that best enables the success of the Company’s business.

4.2 Criteria of Independence

4.2.1 The NR Committee shall assess the independence of Directors at the time of appointment / re-appointment and the Board shall assess the same annually. The Board shall re-assess determinations of independence when any new interests or relationships are disclosed by a Director.

4.2.2 The criteria of independence, as laid down in Companies Act, 2013, is as below:

An independent director in relation to a company, means a director other than a managing director or a whole-time director or a nominee director—

a. who, in the opinion of the Board, is a person of integrity and possesses relevant expertise and experi-ence;

b. (i) who is or was not a promoter of the company or its holding, subsidiary or associate company; ii) who is not related to promoters or directors in the company, its holding, subsidiary or associate

company;

c. who has or had no pecuniary relationship with the company, its holding, subsidiary or associate com-pany, or their promoters, or directors, amounting to two percent or more of its gross turnover or total incomeasmaybeprescribed,whichever is lower,during the two immediatelyprecedingfinancialyearsorduringthecurrentfinancialyear;

d. none of whose relatives has or had pecuniary relationship or transaction with the company, its hold-ing, subsidiary or associate company, or their promoters, or directors, amounting to two per cent or moreofitsgrossturnoverortotalincomeorfiftylakhrupeesorsuchhigheramountasmaybepre-scribed,whicheverislower,duringthetwoimmediatelyprecedingfinancialyearsorduringthecurrentfinancialyear;

e. who, neither himself nor any of his relatives—

(i) holds or has held the position of a key managerial personnel or is or has been employee of the companyoritsholding,subsidiaryorassociatecompanyinanyofthethreefinancialyearsim-mediatelyprecedingthefinancialyearinwhichheisproposedtobeappointed;

54

(ii) isorhasbeenanemployeeorproprietororapartner,inanyofthethreefinancialyearsimmedi-atelyprecedingthefinancialyearinwhichheisproposedtobeappointed,of—

(A) afirmofauditorsorcompanysecretariesinpracticeorcostauditorsofthecompanyoritsholding, subsidiary or associate company; or

(B) anylegaloraconsultingfirmthathasorhadanytransactionwiththecompany,itsholding,subsidiary or associate company amounting to ten per cent or more of the gross turnover of suchfirm;

(iii) holds together with his relatives two per cent or more of the total voting power of the company; or

(iv) isaChiefExecutiveordirector,bywhatevernamecalled,ofanynonprofitorganisationthatreceivestwenty-fivepercentormoreofitsreceiptsfromthecompany,anyofitspromoters,directorsoritshold-ing, subsidiary or associate company or that holds two per cent or more of the total voting power of the company; or

(v) is a material supplier, service provider or customer or a lessor or lessee of the company.

f. shallpossessappropriateskills,experienceandknowledgeinoneormorefieldsoffinance,law,manage-ment, sales, marketing, administration, research, corporate governance, technical operations, corporate social responsibility or other disciplines related to the Company’s business.

g. shallpossesssuchotherqualificationsasmaybeprescribed,fromtimetotime,undertheCompaniesAct,2013.

h. who is not less than 21 years of age.

4.2.3 TheIndependentDirectorsshallabidebythe“CodeforIndependentDirectors”asspecifiedinScheduleIVto the Companies Act, 2013.

4.3 Other directorships / committee memberships

4.3.1 The Board members are expected to have adequate time and expertise and experience to contribute to ef-fective Board performance. Accordingly, members should voluntarily limit their directorships in other listed public limited companies in such a way that it does not interfere with their role as directors of the Company. The NR Committee shall take into account the nature of and the time involved in a Director’s service on other Boards, in evaluating the suitability of the individual Director and making its recommendations to the Board.

4.3.2 A Director shall not serve as a Director in more than 20 companies of which not more than shall be 10 Public LimitedCompanies.

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Annexure - VII

remuneration Policy for directors, Key managerial Personnel and other employees

1. Introduction:

VamaIndustriesLimited(VAMA)recognizestheimportanceofaligningthebusinessobjectiveswithspecificandmeasureable individual objectives and targets. The Company has therefore formulated the remuneration policy for its directors, key managerial personnel and other employees keeping in view the following objectives:

a) Ensuringthatthelevelandcompositionofremunerationisreasonableandsufficienttoattract,retainand motivate employees to run the company successfully.

b) Ensuring that relationship of remuneration to performance is clear and meets the performance bench-marks.

c) Ensuringthatremunerationisbasedonsuchparametersreflectingshortandlongtermperformanceobjectives appropriate to the working of the company and its goals.

2. Scope:

This Policy sets out the guiding principles for the Nomination and Remuneration Committee for recommend-ing to the Board the remuneration of the directors, key managerial personnel and other employees of the Company.

3. Terms and references:

In this Policy, the following terms shall have the following meanings:

3.1 “director” means a director appointed to the Board of the company.

3.2 “Key managerial Personnel” means

(I)theChiefExecutiveOfficerortheManagingDirectorortheManager;(ii) the Company Secretary;(iii) the Whole-time Director;(iv)theChiefFinancialOfficer;and(v)suchotherofficerasmaybeprescribedundertheCompaniesAct,2013.

3.3 Nomination and remuneration Committee” means the committee constituted by the Board of Directors ofVamaIndustriesLimitedinaccordancewiththeprovisionsofSection178oftheCompaniesAct,2013.

4. Policy:

4.1 remuneration to Executive directors and Key managerial Personnel

4.1.1 The Board, on the recommendation of the Nomination and Remuneration Committee, shall review and approve the remuneration payable to the Executive Directors of the Company within the overall limits ap-proved by the shareholders.

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4.1.2 The Board, on the recommendation of the Nomination and Remuneration Committee, shall also review and approve the remuneration payable to the Key Managerial Personnel of the Company.

4.1.3 The remuneration structure to the Executive Directors and Key Managerial Personnel may include the fol-lowing components:

(i) Basic Pay

(ii) Perquisites and Allowances

(iii) Commission (Applicable in case of Executive Directors)

(iv)Retiralbenefits

(v) Annual Performance Bonus

4.2 Remuneration to Non-Executive Directors

The Board, on the recommendation of the Nomination and Remuneration Committee, shall review and approve the remuneration payable to the Non-Executive Directors of the Company within the overall limits approved by the shareholders, if any.

4.3 remuneration to other employees

Employeesshallbeassignedgradesaccordingtotheirqualificationsandworkexperience,competenciesas well as their roles and responsibilities in the organization. Individual remuneration shall be determined withintheappropriategradeandshallbebasedonvariousfactorssuchasjobprofile,skillsets,seniority,experience and prevailing remuneration levels for equivalent jobs.

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Annexure - VIIIWhistleblower policy

As referred in the Directors Report and the Report on Corporate Governance, the Company has framed and adopted the Whistleblower policy that covers our directors and employees. The policy is subject to need based reviewandmodifications,ifrequired,fromtimetotime.ThePolicy,asapplicablecurrently,islaidhereunderandis also posted on our website www.vamaind.com

Scope and purpose:

VamaIndustriesLimited(Vama)iscommittedtocomplyingwiththeforeignanddomesticlawsthatapplytoit,sat-isfying the Company’s Code of Conduct and particularly to assuring that business is conducted with integrity and thattheCompany’sfinancialinformationisaccurate.IfpotentialviolationsofCompanypoliciesorapplicablelawsare not recognized and addressed promptly, both the Company and those working for or with the Company could facegovernmentalinvestigation,prosecution,fines,andotherpenaltiesthatmayhavecascadingimpactandmayprove fatal consequentially, and to promote the highest ethical standards, the Company will maintain a workplace that facilitates the reporting of potential violations of Company’s policies and applicable laws. Employees must be able to raise concerns regarding such potential violations easily and free of any fear of retaliation. That is the pur-pose of this policy (the ‘Policy’ or the ‘Vigil Mechanism and Whistle Blower Policy’). You are required to read this Policy and acquaint yourself with the same.

Report at the earliest - Nip at the bud

Everyone is required to report to the Company any suspected violation of any law that applies to the Company and any suspected violation of the Company’s Code of Conduct. It is important that you report all suspected violations. Thisincludespossibleaccountingorfinancialreportingviolations,insidertrading,bribery,harassment,discrimina-tion in your employment etc.

It is the policy of the Company that you must, when you reasonably suspect that a violation of an applicable law or the Company’s Code of Conduct has occurred or is occurring, report that potential violation. Reporting is crucial for early detection, proper investigation and remediation, and deterrence of violations of Company’s policies or applicable laws. You should not fear any negative consequences for reporting reasonably suspected violations because retaliation for reporting suspected violations is strictly prohibited by Company’s policy. Failure to report any reasonable belief that a violation has occurred or is occurring is itself a violation of this Policy and such failure will be addressed with appropriate disciplinary action, including possible termination of employment.

How & Where to Report Youmustreportallsuspectedviolationsto(i)yourimmediatesupervisor;(ii)thenodalofficer,i.e.,theCompanySecretary; at or (iii) anonymously, by sending an email to: [email protected]

If you have reason to believe that your immediate supervisor or the Company Secretary is involved in the sus-pected violation, your report may be made to the Chairman of the Audit Committee at:

Chairman,AuditCommittee,VamaIndustriesLimited,GroundFloor,B-12,MadhuraNagar,Hyderabad.

Because you have several means of reporting, you need never report to someone you believe may be involved in the suspected violation or from whom you would fear retaliation.

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Your report should include as much information about the suspected violation as you can provide. Where pos-sible, it should describe the nature of the suspected violation; the identities of persons involved in the suspected violation; a description of documents that relate to the suspected violation; and the time frame during which the suspected violation occurred. Where you have not reported anonymously, you may be contacted for further infor-mation.

Post reporting Investigation

All reports under this Policy will be promptly and appropriately investigated, and all information disclosed during thecourseoftheinvestigationwillremainconfidential,exceptasnecessarytoconducttheinvestigationandtakeany remedial action, in accordance with applicable law. Everyone working for or with the Company has a duty to cooperate in the investigation of reports of violations. Failure to cooperate in an investigation, or deliberately providing false information during an investigation, can be the basis for disciplinary action, including termination of employment. If, at the conclusion of its investigation, the Company determines that a violation has occurred, the Company will take effective remedial action commensurate with the nature of the offense. This action may include disciplinary action against the accused party, up to and including termination. Reasonable and necessary steps will also be taken to prevent any further violations of Company’s policy.

Zero - Retaliation policy

No one may take any adverse action against any employee for complaining about, reporting, or participating or assisting in the investigation of, a reasonably suspected violation of any law, this Policy, or the Company’s Code of Conduct and Ethics. The Company takes reports of such retaliation seriously. Incidents of retaliation against any employee reporting a violation or participating in the investigation of a reasonably suspected violation will result in appropriate disciplinary action against anyone responsible, including possible termination of employment. Those working for or with the Company who engage in retaliation against reporting employees may also be subject to civil, criminal and administrative penalties.

Modification

The Audit Committee or the Board of Directors of Vama can modify this Policy unilaterally at any time without notice.Modificationmaybenecessary,amongotherreasons,tomaintaincompliancewithnational,stateorlocalregulations and / or accommodate organizational changes within the Company.

Please sign the acknowledgment form below and return it to the Company Secretary. This will let the Company know that you have received the Policy and are aware of the Company’s commitment to a work environment free of retaliation for reporting violations of any Company policies or any applicable laws.

59

Corporate Governance report

Inaccordancewith theprovisionsof theSEBI (ListingObligationsandDisclosureRequirements)Regulations,2015, the report containing the details of Corporate Governance systems and processes at Vama Industries Limited(VAMA)isasfollows:

I. Company’s philosophy on Code of Governance:

Corporate Governance is the mechanism by which the values, principles, policies and procedures of the Organisation are inculcated and manifested. The essence of Corporate Governance lies in promoting and maintaining integrity, transparency and accountability throughout the organization.

VAMAiscommittedtodobusinessinanefficient,responsible,honestandethicalmanner.CorporateGovernancepractice goes beyond compliance and involves a company-wide commitment and has become the integral part of business.

Good governance responsibilities encompasses the activities of the Board of Directors, who execute their Corporate Governance responsibilities by focusing on the Company’s strategic and operational excellence in the best interests of all stakeholders of the Company, in particular shareholders, employees and our customers in a balancedmannerwithlongtermbenefitstoall.

Good Corporate Governance provides an appropriate framework for the Board, its committees and the executive management to carry out the objectives that are in the interest of the Company and the stakeholders.

The Board of Directors of the Company continues to accord its highest priority for adherence to the principles of Corporate Governance. It believes in up holding the highest standards of accountability and actively participates in overseeing risks and strategic management. The Board of Directors has the basic responsibility to ensure sustainable improvement in corporate evaluations by providing strategic guidance regarding management decisions.

VAMA is conscious of its responsibility to establish a culture that creates an atmosphere of trust amongst all its stakeholders.

II. Board of directors

(a) Composition of the Board

Duringthefinancialyearunderreview,Mr.V.AtchyutaRamaRaju,Chairman&ManagingDirectoroftheCompanyand Mr. V. Rajam Raju, Executive Director of the Company were reappointed by members of the Company through Postal Ballot Process for a further period of three years w.e.f. 01st August, 2015.

Our Board has an optimum combination of Executive, Non-Executive, Independent and Woman Directors.

Out of 6 Directors, 2 of whom are Executive or Whole Time Directors and 3 are Independent Directors and 1 is Non-Executive Woman Director. The said two executive Directors are also the promoters of the Company.

The Board composition is in conformity with Regulation 17 of SEBI (Listing Obligations and DisclosureRequirements) Regulations, 2015 and the provisions of the Companies Act, 2013 and the Nomination and Remuneration Committee periodically evaluates the need for change in composition and size.

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Duringthefinancialyear2015-2016,10(Ten)BoardMeetingswereheldasdetailedhereunder:29thdayofMay,2015,16th day of July, 2015, 28th day of July, 2015, 13th day of August, 2015, 10th day of September, 2015, 09th day of November, 2015, 13th day of November, 2015, 09th day of December, 2015, 21st day of January, 2016 and 12th day of February, 2016. The maximum time-gap between any two consecutive meetings did not exceed 120 days.

(b) Meetings and Attendance Records

The Company prepares schedule of the Board and the Committee meetings in advance for the Directors to make it convenient to attend. The Notice of the Board Meeting and Board Agenda with detailed enclosures are sent in advance to all Directors.

No. of Meetings Held / Attended

Name designation No of Board meetings Attended

Promoter & Executive directors

Mr. V. A. Rama Raju Chairman & Managing Director 10

Mr. V. Rajam Raju Executive Director 10

Non - Promoter & Non - Executive Directors

Mr. R. Venkateswara Rao Independent Director 10

Mr. K. Vara Prasad Raju Independent Director 10

Mr. V. Ramakrishna Rao Independent Director 10

Ms. R. Rama Sravanthi Non-Executive Director 2

(c) Membership in other Boards or Committees

Name No. of Memberships in other Companies (including Private Limited Companies) Board Committees Membership ChairmanshipMr. V. A. Rama Raju 1 Nil N.A. Mr. V. Rajam Raju 1 Nil N.A.Mr. R. Venkateswara Rao 1 Nil N.A.Mr. K. Vara Prasad Raju Nil Nil N.A.Mr. V. Ramakrishna Rao Nil Nil N.A.Ms. R. Rama Sravanthi Nil Nil N.A.

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(d ) Attendance at previous Annual General Meeting

Name Attendance at Previous AGm Mr. V. A. Rama Raju YesMr. V. Rajam Raju YesMr. R. Venkateswara Rao YesMr. K. Vara Prasad Raju NoMr. V. Ramakrishna Rao YesMs. R. Rama Sravanthi Yes

(e) Disclosure of relationship between Directors inter-se

Mr. V. A. Rama Raju and Mr. V. Rajam Raju are related to each other as brothers and share no relationship with any other Director on the Board. None of the other Directors is related to any other Director on the Board.

(f) Independent Directors:

i. Our Independent Directors comply with the requirements as stipulated under Section 149 of theCompaniesAct,2013aswellasRegulation16ofSEBI(ListingObligationsandDisclosureRequirements) Regulations, 2015.

AsmandatedunderRegulation16/Regulation17ofSEBIListingRegulations,theIndependentDirectors on VAMA’s Board are as follows:

Name Category Mr. R. Venkateswara Rao Independent Director Mr. K Vara Prasad Raju Independent Director Mr. V. Ramakrishna Rao Independent Director

ii. meeting of Independent directors:During the year under review, the Independent Directors met on 12th day of February 2015 without the presence of Non-Independent Directors and members of the Management.

The Independent directors reviewed the performance of Non-Independent Directors, the Board and the Chairperson oftheCompany.Theyassessedthequality,quantityandtimelinessofflowofinformationbetweentheCompanymanagement and the Board that is necessary for the Board to effectively and reasonably perform their duties.

All the Independent Directors were present at the Meeting.

iii. Familiarisation Programme for Independent directors:

Regulation25(7)ofSEBI(ListingObligationsandDisclosureRequirements)Regulations,2015andScheduleIVof the Companies Act, 2013 mandates the Company to familiarize the Independent Directors with the Company by conducting training programmes. During the year, the Board members were regularly apprised with the overview of the Company and its operations by the Senior Management team. Further, the business unit heads made

62

presentation to the Board during the Board meeting on a quarterly basis pertaining to the performance and future strategy for their respective business units. The Board was also regularly appraised of all regulatory and policy changes.

The Familiarisation Programme is posted on the company’s website and can be accessed at on the Company’s Website at the link:

http://www.vamaind.com/Policies/Familiarisation_Programme_for_Independent_ Directors.pdf

(g) Code of Conduct:

The Board has laid down a code of conduct for all Board members and Senior Management of the Company and it is posted on the website of the Company at the link http://www.vamaind.com/Code_of_Conduct.pdf .

The declaration from Chairman& Managing Director with regard to compliance of code of conduct by the Board of Directors and Senior Management is enclosed and forms part of this report.

(h) Vigil Mechanism / Whistle Blower Policy:

In terms of provisions of Section 177(9)/(10) of the CompaniesAct, 2013 and Regulation 22 of the ListingRegulations, your Company has formalized the process and institutionalized a Whistle Blower Policy in the Organisation.

As referred in the Directors Report, the vigil mechanism for its Directors and employees also incorporates a WhistleBlowerPolicy, basically enabling the seamless flowof grievances from the victims / observers to theredressal authority.

TheCompanySecretaryoftheCompanyhasbeenmadethenodalofficertoreceivethecomplaints/concerns/ grievances of employees, who in turn escalates the matter to the Audit Committee who oversees the vigil mechanism.

The nodal officer, upon receipt of any complaints / concerns / grievances, process the same and does thepreliminary investigation and then present the facts of the case to the Audit Committee.

The employee, in exceptional cases, can directly access the Chairman of the Audit Committee by any available mode of communication.

The Vigil Mechanism and Whistle Blower Policy is attached at Annexure VIII to the Board’s Report and may also be accessed on the Company’s Website at the link: http://www.vamaind.com/Policies/Vigil_Mechanism_Whistle_Blower_Policy.pdf

Itisherebyaffirmedthatnopersonnelhasbeendeniedaccesstotheauditcommittee.

(i) Board Evaluation

Pursuant to the provisions of the Companies Act, 2013, Schedule IV and Regulation 17 of Securities and Exchange BoardofIndia(ListingObligationsandDisclosureRequirements)Regulations,2015,theBoardhascarriedoutanAnnual Performance Evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Committees.

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In line with effective governance requirements, the Board reviews its own performance annually using a pre-determined template designed as a tool to facilitate the evaluation process. The assessment was built around the functioning of the Board as a whole, its Committees and also the evaluation of Individual Directors. The self-assessment format considered performance effectiveness with regard to Board composition, expertise, dynamics, strategic oversight, risk management and internal control, succession planning and leadership.

While the individual directors’ performance was reviewed by the Chairperson and rest of the Board excluding the Director being evaluated, the Chairperson’s and Non-Independent Directors performance were appraised through feedback from the Independent Directors.

(ii) Transactions with Related Parties

All Related Party Transactions which were entered into during the Financial Year were on an arm’s length basis and in the ordinary course of business and did not attract provisions of Section 188 of Companies Act, 2013 relating toapprovalofshareholders.TherearenomateriallysignificantrelatedpartytransactionsmadebytheCompanywiththePromoters,Directors,KeyManagerialPersonneloranyrelatedpartywhichmayhaveapotentialconflictof interest with the Company at large.

All Related Party Transactions are placed before the Audit Committee and the Board for approval.

None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company.

The Company has formulated a policy on “materiality of related party transactions” and the process of dealing with suchtransaction,whichareinlinewiththeprovisionsoftheCompaniesAct,2013andSEBI(ListingObligationsand Disclosure Requirements) Regulations, 2015.

The same is also available on the website of the Company at the link http://www.vamaind.com/Policies/Related_Party_Transactions_Policy.pdf

III. COMMITTEES OF THE BOARD

TheBoardhasconstitutedvariousCommitteestofocusonspecificareasandtomakeinformeddecisionswithintheir authority. Each Committee is directed by its Charter which outlines its scope, roles and responsibilities and its powers. All the decisions and recommendations of the Committee are placed before the Board for its approval.

The various Committees of the Board are as under:

➢ Audit Committee➢ Nomination & Remuneration Committee➢ Risk Management Committee➢ Stakeholders Relationship Committee

TheroleandcompositionoftheseCommittees,includingthenumberofMeetingsheldduringthefinancialyearand the related attendance are provided below:

1. AudIT COmmITTEE

TheAudit Committee of the Board deals with allmatters relating to financial reporting, internal controls, riskmanagement etc. and reports to the Board from time to time.

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The powers, role and terms of reference of the Audit Committee are in accordance with the provisions of Regulation 18oftheListingRegulations,2015andSection177oftheCompaniesAct,2013andthecommitteesalsodischargesuchotherfunctionsasmaybespecificallydelegatedtoitbytheBoardfromtimetotime.

A. Composition & Attendance in meetings

InaccordancewiththeprovisionsofClause49oftheListingAgreementandinaccordancewiththeprovisionsofRegulation18oftheListingRegulations,2015andSection177oftheCompaniesAct,2013,thecompositionofour Audit Committee is as follows:

Name designation No. of meetings held No. of meetings attended

Mr. V. Ramakrishna Rao Chairman 4 4

Mr. R. Venkateswar Rao Member 4 4

Mr. K. Vara Prasad Member 4 4

Mr. Rohit Tibrewal, the Company Secretary acts as the Secretary to the Committee.

All the members of the Committee are Non-Executive and Independent Directors. The members possess sound knowledgeofaccounts,finance,auditandlegalmatters.

The Chairman of the Audit Committee, Mr. V.Ramakrishna Rao attended the previous Annual General Meeting (AGM) held on 29th Day of September, 2015 to answer the Shareholders’ queries.

B. Role of the Audit Committee includes:-

1. OversightoftheCompany’sfinancialreportingprocessanddisclosureofitsfinancialinformationtoensurethatthefinancialstatementiscorrect,sufficientandcredible;

2. Recommendation for appointment, remuneration and terms of appointment of Statutory Auditors of the Company;

3. Approval of payment to Statutory Auditors for any othe rservices rendered by the Statutory Auditors;

4. Reviewing with the management, the annual financial statements and auditor’s report thereon, beforesubmission to the Board for approval, with particular reference to:

a. Matters required to be included in the Director’s Responsibility Statement to be included in the Board’s report in terms of clause (c) of sub-section 3 of section134 of the Companies Act, 2013.

b. Changes, if any, in the accounting policies and practices and reasons for the same.

c. Major accounting entries involving estimates based on the exercise of judgment by the management.

d. Significantadjustmentsmadeinthefinancialstatementsarisingoutofauditfindings.

e. Compliancewithlistingandotherlegalrequirementsrelatingtofinancialstatements.

f. Disclosure of any related party transactions.

g. Modifiedopinion(s) in the draft audit report.

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5. Reviewingwith themanagement, the quarterly financial statements before submission to the board forapproval;

6. Reviewing with the management the statement of uses/application of funds raised through an issue (public issue, rights issue, preferential issue etc.), the statement offunds utilized for the purposes other than those statedin the offer document / prospectus / notice and reportsubmitted by the monitoring agency, monitoring utilisation of proceeds of a public or rights issue and making appropriate recommendations to the Board to take up steps in thismatter;

7. Reviewing and monitoring the auditor’s independence and performance, and effectiveness of audit process;

8. ApprovaloranysubsequentmodificationoftransactionsoftheCompanywiththerelatedparties;

9. Scrutiny of the inter-corporate loans and investments;

10. Valuation of undertakings or assets of the company,wherever it is necessary;

11. Evaluationofinternalfinancialcontrolsandriskmanagementsystems;

12. Reviewing with the management, performance of statutory and internal auditors and adequacy of the internal controlsystems;

13. Reviewing adequacy of internal audit function, if any,including structure of the internal audit department, staffingandseniorityoftheofficialheadingthedepartment,reportingstructure,coverageandfrequencyofinternal audit;

14. Discussionwiththeinternalauditorsofanysignificantfindingsandfollowupthereon;

15. Reviewing findings of any internal investigations by theinternal auditors into matters where there is asuspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board;

16. Discussions with the statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern;

17. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors;

18. To review functioning of the Whistle Blower mechanism;

19. Approval of appointment of CFO (i.e. the Wholetime Finance Director or any other person heading the financefunctionordischargingthatfunction)afterassessingthequalifications,experienceandbackgroundetc. of the candidate;

20. Carrying out any other function as stipulated in terms of reference of the Audit Committee.

The audit committee shall mandatorily review the following information:

• managementdiscussionandanalysisoffinancialconditionandresultsofoperations.

• statementofsignificantrelatedpartytransactions(asdefinedbytheauditcommittee),submittedbymanagement.

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• managementletters/lettersofinternalcontrolweaknessesissuedbythestatutoryauditors.

• internalauditreportsrelatingtointernalcontrolweaknesses.

• theappointment,removalandtermsofremunerationoftheinternalauditorshallbesubjecttoreviewby the audit committee.

• statementofdeviations,ifany.

CEO/CFO Certification

TheCMDandCFOhavecertified, intermsofregulation17(8)oftheSEBI(ListingObligationsandDisclosureRequirements)Regulations,2015totheBoardthatthefinancialstatementspresentatrueandfairviewoftheCompany’s affairs and are in compliance with the existing accounting standards.

2. NOmINATION ANd rEmuNErATION COmmITTEE

TheCommitteefunctionsaspertheRegulation19oftheSEBI(ListingObligationsandDisclosureRequirements)Regulations, 2015 and as per Section 178 of the Companies Act, 2013. The purpose of the Committee is to determine/reviewtheCompany’spolicyonspecificremunerationpackagesfortheExecutiveDirectorsincludingpension rights and any compensation payment, oversee the framing, review and implementation of compensation policy of the Company on behalf of the Board, form a policy, procedures and schemes and to undertake overall supervision and administration of Employee Stock Option Schemes (ESOSs) of the Company if any and to review the Board structure, size and composition and make recommendation for any change. The Committee also formulates evaluation criteria for Directors and the Board.

A. Composition & Attendance in meetings:

InaccordancewiththeprovisionsofClause49oftheListingAgreementandRegulation19oftheListingRegulations,2015 and Section 178 of the Companies Act, 2013, the composition of our Nomination and Remuneration Committee is as follows:

Name designation No. of meetings held No. of meetings attended Mr. R. Venkateswar Rao Chairman 2 2

Mr. V. Ramakrishna Rao Member 2 2

Mr. K. Vara Prasad Raju Member 2 2

Mr. Rohit Tibrewal, the Company Secretary acts as the Secretary to the Committee.

All the members of the Committee are Non-Executive and Independent Directors.

B. Terms of reference:

The terms of reference of our Nomination and Remuneration Committee are in accordance with the listing Agreement enteredwithStockExchangeandRegulation19of theListingRegulations, 2015 readwithCompanies Act,2013 and includes such other functions as may be assigned to it by the Board from time to time.

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C. The Role of the Nomination and Remuneration Committee includes:-

i) Formulationofcriteriafordeterminingqualifications,positiveattributesandindependenceofadirectorand recommend to the Board a Policy, relating to the remuneration of the directors, key managerial personnel and other employees;

ii) Formulation of criteria for evaluation of Independent Directors and the Board;

iii) Devising a Policy on diversity of Board of Directors;

iv) Identifying persons who are qualified to become directors and who may be appointed in seniormanagement in accordance with the criteria laid down, and recommend to the Board their appointment and removal.

v) Whether to extend or continue the term of appointment of the independent director, on the basis of the report of performance evaluation of independent directors.

d. remuneration policy

The Executive Directors are paid remuneration in terms of are solution passed by the members at the General Meetings.The Nomination & Remuneration Committee ensures a transparent nomination process for Directors with the diversity of thought, experience, knowledge, perspective and gender in the Board.

Our Remuneration Policy for Directors, Key managerial Personnel and other employeesforms part of the Annual Report and marked as Annexure –VII to the Board Report.

Details of Remuneration to Directors for the Financial year 2015-16 (a) Executive Directors:

Mr. V.A. Rama Raju (in ` )

Salary (Basic) 8,40,000

HRA 3,36,000

Other Allowances 8,04,000

Total 19,80,000

Mr. V. Rajam Raju (in ` )

Salary (Basic) 8,40,000

HRA 3,36,000

Other Allowances 6,24,000

Total 18,00,000

(b) Non Executive Directors

Remuneration paid to Non-executive Directors : Nil

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The Company has not entered into any pecuniary transaction with any of its Non-Executive Directors. Hence, no disclosure need to be made in this regard.

Shares held by Non-Executive Directors in the Company as on 31.03.2016 are as follows:-

Name No. of Shares held % of Shares held

Mr. R. VenkateswaraRao 700 0.01

Mr. V. Ramakrishna Rao 200 Negligible

Mr. K. Vara Prasad Raju 300 Negligible

E. Performance evaluation of Independent directors:

The Board is responsible for undertaking a formal annual evaluation of its own performance, that of its Committees andof individualDirectorsasperSection134oftheCompaniesAct,2013andRegulation19ofSEBI(ListingObligations and Disclosure Requirements) Regulations, 2015 with a view to review their functioning and effectiveness and also for identifying possible paths for improvement. During the year, the Board in concurrence with Nomination and Remuneration Committee carriedout a performance evaluation of itself, its Committees, and each of the executive/ non-executive/ independent directors through an online survey process.

The Independent directors were evaluated on various performance indicators including aspects relating to:

• Integrityandmaintenanceofconfidentiality• CommitmentandparticipationattheBoard&Committee• Effectivedeploymentofknowledgeandexpertise• ExerciseofobjectiveindependentjudgementinthebestinterestofCompany• Interpersonalrelationshipswithotherdirectorsandmanagement

The board and committee were evaluated on the following parameters:

• Size,structureandexpertiseoftheBoard.• Reviewofstrategies,riskassessment,robustpoliciesandproceduresbyBoard.• Oversightofthefinancialreportingprocess&monitoringcompany’sinternalcontrolsystem.• Qualityofagenda,conductofmeeting,proceduresandprocessfollowedforeffectivedischargeoffunctions.• EffectivedischargeoffunctionsanddutiesbyCommitteeasperthetermsofreference.• Appropriatenessandtimelinessoftheupdatesgivenonregulatorydevelopments.• Board’sengagementwithSeniorManagementteam. The Chairperson had an individual discussion with each director based on the peer analysis. The feedback

was collated and discussed with the Board and action points for improvement are put in place.

3. STAKEHOLDERS RELATIONSHIP COMMITTEE

A. Composition & Attendance in meetings:

InaccordancewiththeprovisionsofClause49oftheListingAgreementandRegulation20ofSEBI(ListingObligations and Disclosure Requirements) Regulations, 2015 and Section 178 of the Companies Act, 2013, the composition of our Stakeholders Relationship Committeeis as follows:

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Mr. R. Venkateswar Rao Chairman 2 2

Mr. V. Ramakrishna Rao Member 2 2

Mr. V.A. Rama Raju Member 2 2

Mr. Rohit Tibrewal, the Company Secretary and ComplianceOfficer of the Company is the Secretary of theCommittee.

The Stakeholders Relationship Committee is responsible for resolving investor’s complaints pertaining to share transfers,non-receiptofAnnualReports,DividendPayments,IssueofDuplicatesharecertificates,Transmissionof shares and other related complaints.

B. Terms of reference

TheCommitteeisfunctioningintermsofmandatoryrequirementofRegulation20ofSEBI(ListingObligationsandDisclosure Requirements) Regulations, 2015 and as per Section 178 of the Companies Act, 2013. The main role of the Committee is to look into the redressal of grievances of investors, debenture holders, deposit holders or other security holders relating to transfer of shares; non-receipt of balance sheet; non-receipt of declared dividends; non-receipt of annual reports; non-receipt of interest etc. In addition to this, the Committee also looks into investor relations,sharetransfer(totheextentnotdelegatedtoofficials)andmonitorsservicingofinvestorrequirements.ConsequenttonotificationdatedJanuary15,2015issuedbySecuritiesandExchangeBoardofIndia(SEBI),theCompany has adopted new ‘Code of Internal Procedures and Conduct for Regulating, Monitoring and Reporting of Trading by Insiders’ and ‘Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information’ and said new code has been made applicable to all designated employees and other connected persons.

The Stakeholders Relationship Committee monitors compliance of the provisions of ‘Code of Internal Procedures and Conduct for Regulating, Monitoring and Reporting of Trading by Insiders’ and ‘Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information’.

In order to expedite the process and for effective resolution of grievances/complaints, the Committee has delegatedpowers to theRegistrarandShareTransferAgents i.e.,M/s.BigshareServicesPvtLtd., to redressall the complaints/grievances/enquiries of the shareholders/investors. It redresses the grievances/complaints of shareholders/investorsunderthesupervisionofCompanySecretary&ComplianceofficeroftheCompany.

The Committee, along with the Registrar and Share Transfer Agents of the Company follows the policy of attending to the complaints, if any, within seven days from the date of its receipt.

As mandated by SEBI, the Quarterly Reconciliation of Share Capital Audit, highlighting the reconciliation of total admitted capital with National Securities Depository Limited (NSDL) and Central Depository Services (India)Limited(CDSL)vis-à-visthetotalissuedandlistedcapitalisbeingcarriedoutbyaPracticingCompanySecretary.ThisAuditconfirmsthattotalissuedandpaidupcapitalisinagreementwiththetotalnumberofsharesheldinphysicalanddematerializedformwithNSDLandCDSL.

Ason31stMarch,2016,9730478equitysharesofRs.10eachrepresenting99.72%ofthetotalequitycapitalofthe company were held in dematerialized form.

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Shareholders Grievances during the Financial Year2015-16

Nature of Queries Received during the year Redressed Pending as on 31st / Complaints during the year March 2016

Nil Nil Nil Nil

You may note that, there are No Complaints pending during the Financial year 2015-16.

4. rISK mANAGEmENT COmmITTEE

The primary function of the Risk Management Committee is to assist the Board to manage the risk appetite of the Companyinordertopromoteabalancedbusinessmodelandgrowth.Thecommitteeoverseestheidentificationofmajor areas of risk being faced by the Company, the development of strategies to manage those risks and reviews the risk management policies and their implementation. A. Composition & Attendance in meetings :

The composition of our Risk Management Committee is as follows:


Mr. V. Ramakrishna Rao Chairman 2 2

Mr. V. Rajam Raju Member 2 2

Mr. V. A. Rama Raju Member 2 2

Mr. Rohit Tibrewal, the Company Secretary is the secretary of the committee.

B. Functions, Roles and Responsibilities

1. Toapprovestructures,analyserisksandbenefits,seekindependentopinionwithregardtostructureor views.

2. AssistingtheBoardinfulfillingitsoversightresponsibilitieswithregardtoEnterpriseRiskManagement.

3. Reviewing and approving risk related disclosures.

4. Responsiblefordaytodayoversightriskmanagementincludingidentification,impactassessment,monitoring, mitigation and reporting.

5. Formulation and implementation of risk management policies and procedures.

6. Providing updates to the Board on enterprise risk and action taken.

7. Ensurecompliancewithpoliciesandprocedures laiddownby theCompany forspecificbusinessunits.

8. Maintenance and development of our supportive culture, in relation to the management of risk appropriately embedded through procedures ,training and leadership actions so that all employees are alert to the wider impact on the whole organisation of their actions and decisions.

9. Advising Board on all high level risk matters.

10. To review the effectiveness of the internal control.

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IV. GENERAL BODY MEETINGS & SHAREHOLDERS INFORMATION

(a) The Details of the last three (3) Annual General Meetings are as follows:

Financial Time Venue Special Date & Year Resolutions

Passed

2014-15 Sep 29, 2015 Hotel inner circle , Raj Bhavan Road , (Tuesday) Somajiguda , Hyderabad – 500082 None at 10.00 A.M

2013-14 Sep 25, 2014 Hotel inner circle , Raj Bhavan Road , (Thursday) Somajiguda , Hyderabad – 500082 3 at 10.00 A.M 2012-13 Sep 28, 2013 Hotel inner circle , Raj Bhavan Road , (Saturday) Somajiguda , Hyderabad – 500082 None at 10.00 A.M

(b) Postal Ballot

During the financial year under review, Postal Ballot process was undertaken and Mr. Vikas Sirohiya,Practising Company Secretary was appointed as Scrutinizer to conduct the process of Postal Ballot in fair and transparent manner.

The members of the Company passed the following resolutions by way of Postal Ballot:

(i) Increase in the Authorised Share Capital from Rs.9 Crores to Rs.11 Crores(ii) Adoption of new set of Articles of Association (iii) Re-appointmentofMr.V.A.RamaRajutotheofficeofManagingDirectoroftheCompany(iv) Re-appointmentofMr.V.RajamRajutotheofficeofExecutiveDirectoroftheCompany(v) Appointment of Mrs. R. Rama Sravanthi as Director of the company(vi) Borrowing powers of the Board(vii) To create charge/mortgage on the assets of the Company (viii) Preferential issue of Equity Shares(ix) Preferential issue of Warrants

The said process was completed on 15th July, 2015, wherein all the resolutions as proposed were passed by way of requisite majority. The result was announced on 15th July, 2015. The details of Voting are as hereunder:

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Promoter/Public No. of. Shares No. of votes % of Votes No. of Votes No. of Votes % of Votes % of Votes held polled Polled on Favor Against in Favor on against outstanding votes polled votes polled sharesPromoter and Promoter Group Electronic Poll 3912366 1251900 31.999 1251900 0 100 N.APhysical Poll 2660466 68.001 2660466 0 100 N.A Sub Total 3912366 3912366 100 3912366 0 100 N.APublic Institutional Holders Electronic Poll 0 N.A N.A N.A N.A N.A N.APhysical Poll 0 N.A N.A N.A N.A N.A N.A Sub Total 0 N.A N.A N.A N.A N.A N.APublic-Others Electronic Poll 4325634 612808 14.167 612731 77 99.987 0.013Physical Poll 1214445 28.076 1214445 0 100 N.A Sub Total 4325634 1827253 42.242 1827176 77 99.996 0.004 TOTAL 8238000 5739619 69.672 5739542 77 100 0.001

Promoter/Public No. of. Shares No. of votes % of Votes No. of Votes No. of Votes % of Votes % of Votes held polled Polled on Favor Against in Favor on against outstanding votes polled votes polled sharesPromoter and Promoter Group Electronic Poll 3912366 1251900 31.999 1251900 0 100 N.APhysical Poll 2660466 68.001 2660466 0 100 N.A Sub Total 3912366 3912366 100 3912366 0 100 N.APublic Institutional Holders Electronic Poll 0 N.A N.A N.A N.A N.A N.APhysical Poll 0 N.A N.A N.A N.A N.A N.A Sub Total 0 N.A N.A N.A N.A N.A N.APublic-Others Electronic Poll 4325634 612808 14.167 612731 77 99.987 0.013Physical Poll 1214445 28.076 1214445 0 100 N.A Sub Total 4325634 1827253 42.242 1827176 77 99.996 0.004 TOTAL 8238000 5739619 69.672 5739542 77 100 0.001

1. Increase in the Authorised Share Capital from Rs.9 Crores to Rs.11 Crores

2. Adoption of new set of aticles of association

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Promoter/Public No. of. Shares No. of votes % of Votes No. of Votes No. of Votes % of Votes % of Votes held polled Polled on Favor Against in Favor on against outstanding votes polled votes polled sharesPromoter and Promoter Group Electronic Poll 3912366 1251900 31.999 1251900 0 100 N.APhysical Poll 599442 15.322 599442 0 100 N.A Sub Total 3912366 1851342 47.320 1851342 0 100 N.APublic Institutional Holders Electronic Poll 0 N.A N.A N.A N.A N.A N.APhysical Poll 0 N.A N.A N.A N.A N.A N.A Sub Total 0 N.A N.A N.A N.A N.A N.APublic-Others Electronic Poll 4325634 612808 14.167 612808 0 100 N.APhysical Poll 1214445 28.076 1214445 0 100 N.A Sub Total 4325634 1827253 42.242 1827253 0 100 N.A TOTAL 8238000 3678595 44.654 3678595 0 100 N.A


3. Reappointment of Mr. V.A Rama Raju to the office of Managing Director of the company

4. Reappointment of Mr. V. Rajam Raju to the office of Executive Director of the company

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5. Appointment of mrs. r. rama Sravanthi as director of the Company

6. Borrowing Powers of the Board

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Promoter/Public No. of. Shares No. of votes % of Votes No. of Votes No. of Votes % of Votes % of Votes held polled Polled on Favor Against in Favor on against outstanding votes polled votes polled sharesPromoter and Promoter Group Electronic Poll 3912366 1251900 31.999 1251900 0 100 N.APhysical Poll 2660466 68.001 2660466 0 100 N.A Sub Total 3912366 3912366 100.000 3912366 0 100 N.APublic Institutional Holders Electronic Poll 0 N.A N.A N.A N.A N.A N.APhysical Poll 0 N.A N.A N.A N.A N.A N.A Sub Total 0 N.A N.A N.A N.A N.A N.APublic-Others Electronic Poll 4325634 612808 14.167 612731 77 99.987 0.013Physical Poll 1214445 28.076 1214445 0 100 N.A Sub Total 4325634 1827253 42.242 1827176 77 99.996 0.004 TOTAL 8238000 5739619 69.672 5739542 77 100 0.001

Promoter/Public No. of. Shares No. of votes % of Votes No. of Votes No. of Votes % of Votes % of Votes held polled Polled on Favor Against in Favor on against outstanding votes polled votes polled sharesPromoter and Promoter Group Electronic Poll 3912366 1251900 31.999 1251900 0 100 0Physical Poll 2660466 68.001 2660466 0 100 0 Sub Total 3912366 3912366 100 3912366 0 100 0Public Institutional Holders Electronic Poll 0 N.A N.A N.A N.A N.A N.APhysical Poll 0 N.A N.A N.A N.A N.A N.A Sub Total 0 N.A N.A N.A N.A N.A N.APublic-Others Electronic Poll 4325634 612808 14.167 612731 77 99.987 0.013Physical Poll 1214445 28.076 1214445 0 100 N.A Sub Total 4325634 1827253 42.242 1827176 77 99.996 0.004 TOTAL 8238000 5739619 69.672 5739542 77 100 0.001

7. To create charge / mortgage on the assets of the Company

8. PREFERENTIAL ISSUE OF EQUITY SHARES

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Promoter/Public No. of. Shares No. of votes % of Votes No. of Votes No. of Votes % of Votes % of Votes held polled Polled on Favor Against in Favor on against outstanding votes polled votes polled sharesPromoter and Promoter Group Electronic Poll 3912366 1251900 31.999 1251900 0 100 0Physical Poll 2660466 68.001 2660466 0 100 0 Sub Total 3912366 3912366 100 3912366 0 100 0Public Institutional Holders Electronic Poll 0 N.A N.A N.A N.A N.A N.APhysical Poll 0 N.A N.A N.A N.A N.A N.A Sub Total 0 N.A N.A N.A N.A N.A N.APublic-Others Electronic Poll 4325634 612808 14.167 612731 77 99.987 0.013Physical Poll 1214445 28.076 1214445 0 100 N.A Sub Total 4325634 1827253 42.242 1827176 77 99.996 0.004 TOTAL 8238000 5739619 69.672 5739542 77 100 0.001

9. PREFERENTIAL ISSUE OF WARRANTS

As of now, there is no proposal to pass any Special resolution through Postal Ballot process. Special resolutions, if required to be passed in the future, will be decided at the relevant time. The procedure for postal Ballot is / shall be as per the provisions contained in this behalf in the Companies Act, 2013 and rules made there under.

(c) Annual General Meeting

date &Time: : September 26, 2016 at 10.00 A.M

Venue : Inner Circle, Raj Bhavan Road, Somajiguda, Hyderabad-500082.

(d) Financial Year (2015-2016)

The Financial year under review is 2015-2016 [01st April, 2015 to 31st March,2016..

(e) Book Closure

September 20th, 2016 to September 26th, 2016 [both days inclusive]

(f) Dividend

Board of DirectorsatitsMeetingheldonMay30th,2016recommendedthedividendofRe.0.10(1%)perequityshareofRs.10/-eachforthefinancialyear2015-16subjecttotheapprovalofshareholdersattheensuing Annual General Meeting.If approved, the dividend will be paid on or before 25th October, 2016 to such shareholders whose names shall appear on the Company’s Register of Members on Monday, September 19th, 2016 and in respect of the shares held in dematerialized form, the dividend will be paid tomemberswhosenamesare furnishedbyNationalSecuritiesDepository Limited [NSDL] andCentralDepositoryServices(India)Limited[CDSL]asbeneficialOwnersasonthatdate.

(g) Listing Details

Atpresent,theEquitySharesoftheCompanyarelistedonBSELimited(BSE).

TheAnnualListingfeesforthefinancialyear2016-17onequitysharecapitalhasbeenpaidtoBSE.

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TheCompanyhaspaidcustodialfeesfortheyear2016-17toNationalSecuritiesDepositoryLimited[NSDL]andCentral Depository Services (India) Limited [CDSL] on the basis of number of beneficial accountsmaintained by them as on March 31, 2016

(h) Stock Information BSE Scrip Code : 512175 ScripName :VAMAIndustriesLtd., Symbol : VAMA IND Series : EQ ISIN : INE685DO1014

(i) Market Price Data

MonthlyhighandlowquotationsofequitysharestradedonBSELimitedduringthefinancialyear2015-16:

Financial Year 2015-2016 BSE

High Low Volume (Rs) (Rs) (No. of Shares)

April 2015 27.50 17.15 74873

May 2015 32.40 22.00 76412

June 2015 42.90 19.95 379720

July 2015 43.50 36.00 165127

August 2015 42.00 21.15 224051

September 2015 36.75 22.55 25608

October 2015 33.80 23.50 75261

November 2015 31.95 24.15 75819

December 2015 29.00 22.80 71069

January 2016 29.65 20.85 35504

February 2016 25.45 18.00 23294

March 2016 22.00 16.00 39781

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j. Distribution of shareholding

(As on 31.03.2016)

range of Equity Shares No of shares % to capital No of shares % of share holders holders

1 - 500 102893 1.05 718 62.48

501 - 1000 98195 1.00 120 10.44

1001 - 2000 126376 1.29 81 7.04

2001 - 3000 118241 1.21 47 4.09

3001 - 4000 84215 0.86 23 2.00

4001 - 5000 108545 1.11 23 2.00

5001 - 10000 470464 4.82 63 5.48

10001 - 9999999999 8649071 88.63 74 6.44

(k) Dematerialization of shares and liquidity

AsatMarch31,2016,9730478equitysharesrepresenting99.72%ofthetotalequitycapitalofthecompany were held in dematerialized form and the rest in the physical form.

Shares held in demat & Physical mode as at march 31, 2016 are as follows:

Category Number of % of Equity

Share holders shares

demat mode

NSDL 642 7582484 77.70

CDSL 472 2147994 22.01

Total Dematerialised Shares 1114 9730478 99.72

Physical Mode 35 27522 0.28

Grand Total 1149 9758000 100.00

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(l) Shareholders holding more than 1% of the shares

TheDetailsoftheshareholders(nonpromoters)holdingmorethan1%oftheequityasatMarch31,2016are as follows :

[As on 31.03.2016]

Sl. No Name of the Shareholder No of shares %

1 Anil Unnikrishnan 8,90,000 9.12

2 NirantTechnologiesPvt.Ltd. 5,00,000 5.12

3 SainarenPropertiesPvt.Ltd. 4,00,000 4.09

4 Nitin Siddamsetty 3,30,000 3.38

5 Mr. V V S Murty 160000 1.63

6 Mr. Subba Rao Vitakula 150000 1.53

7 Mr. Venu Gopala Raju Vegesna 140153 1.43

8 Ms. V Chandravati 134253 1.37

9 Mr. Venkata Kakumanu Krishna Rao 106950 1.09

10 Mr. Chandramouli T B V P 100403 1.02

(m) Designated email Id for Investor Services

The designated email ID for investor’s complaints is [email protected].

(n) Outstanding GDRs/ ADRs/ warrants or any convertible instruments, conversion date and likely impact on Equity

The Company has not issued any of these instruments till date.

(o) Plant Location(s): Not applicable

(p) Communication Address for Investors: CompanySecretary&ComplianceOfficerVAMAIndustriesLimitedGround Floor, 8-3-191/147/24,Plot No. B-12, Madhura Nagar,S. R. Nagar [Post], Hyderabad-500 038, TS, India.

(q) Registrar and Share Transfer Agent

The Board of Directors of the Company has delegated the power of share transfer and related operations to M/s.BigshareServicesPrivateLimited,RegistrarandShareTransferAgents.

All the correspondence relating to the shares of the company should be addressed to Big Share Services PrivateLimitedattheaddressgivenbelow.

Bigshare Services Private Limited306, Right wing, AmruthavilleOpp Yashoda HospitalSomajiguda, Rajbhavan Road, Hyderabad-500 082.

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Share Transfer System:

All the transfers are noted by the Stakeholders Relationship Committee. Share transfer requests which are receivedinphysicalform,areprocessedandthesharecertificateswerereturnedwithinaperiodof15daysin most cases, and in any case within 30 days, from the date of receipt, subject to the documents being in order and complete in all respects.

TheCompanyobtains fromaCompanySecretary inpracticeHalf-YearlyCertificateofcomplianceswiththe share transfer formalities as required underClause 47 (c) of the ListingAgreementwith theStockExchangesandfilesacopyoftheCertificatewiththeStockExchange(s).

(r) CEO and CFO Certification

AsrequiredbyClause49of theListingagreementandScheduleIIof theSEBI(ListingObligationsandDisclosureRequirements)Regulations, 2015, theCEOandCFO certification is attached to theAnnualReport.

(s) Code of Conduct

In compliancewith revisedClause 49 of the listing agreement and as per the provisions of the ListingRegulations, the company has adopted a code of conduct. This code is applicable to the members of the Board, Senior Management Personnel and Designated Employees of the Company. The code of conduct is available on our website, www.vamaind.com.

All the members of the Board and the Senior Management Personnel and Designated Employees of the Companyhaveaffirmedcompliance to thecodeofconduct,asatMarch31,2016.Adeclaration to thiseffect, signed by the Managing Director is attached to the Annual Report.

(t) Capital Reconciliation Audit

AqualifiedPractisingCompanySecretarycarriesoutCapitalReconciliationAuditeveryquartertoreconcilethe total admitted capital with that in the National Securities Depository Limited (NSDL) and CentralDepositoryServices(India)Limited(CDSL)andthetotalissuedandlistedcapital.TheAuditconfirmsthatthe total issued/ paid up capital is in agreement with the aggregate number of shares in physical form and thetotalnumberofdematerializedsharesheldwithNSDL&CDSL.

(u) Nomination in respect of shares held in Physical form

Section 72 of the Companies Act, 2013 extends nomination facility to individuals holding shares in Physical form in companies. Members, in particular those holding shares in single name may avail this facility by furnishing the particulars of their nomination in applicable Form for this purpose.

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(v) Shareholding patternCategory Category of Number of “Total Number of Shares Total Shareholding Shares Pledged orCode Shareholder Shareholders Number of held in percentage of total otherwise Shares Dematerialised form number of shares encumbered(I) (II) (III) (IV) (V) (VI) (VII) (VIII) “(IX)= (VIII)/(IV) *100”(A) Shareholding of Promoter and Promoter Group1. INdIAN (a) INDIVIDUAL/HUF 10 4212366 4212366 43.16 43.16 0 0.00(b) CENTRAL/STATEGOVERNMENT(S) 0 0 0 0.0000 0.0000 0 0.00(c) BODIES CORPORATE 0 0 0 0.0000 0.0000 0 0.00 (d) FINANCIALINSTITUTIONS/BANKS 0 0 0 0.0000 0.0000 0 0.00(e) ANY OTHERS (Specify) (i) DIRECTORS/RELATIVES 0 0 0 0.0000 0.0000 0 0.00(ii) GROUP COMPANIES 0 0 0 0.0000 0.0000 0 0.00 SUB TOTAL (A)(1) : 10 4212366 4212366 43.16 43.16 0 0.00 2. FOrEIGN (a) INDIVIDUAL 0 0 0 0.0000 0.0000 0 0.00(b) BODIES CORPORATE 0 0 0 0.0000 0.0000 0 0.00 (c) INSTITUTIONS 0 0 0 0.0000 0.0000 0 0.00 (d) QUALIFIEDFOREIGNINVESTOR 0 0 0 0.0000 0.0000 0 0.00 SUBTOTAL(A)(2): 0 0 0 0.0000 0.0000 0 0.00 Total holding for Promoters and Promoter group (A)=(A)(1) + (A)(2) 10 4212366 4212366 43.16 43.16 0 0.00(B) Public shareholding1. INSTITuTIONS(a) MUTUALFUNDS/UTI 0 0 0 0.0000 0.0000 0 0.00(b) FINANCIALINSTITUTIONS/BANKS 0 0 0 0.0000 0.0000 0 0.00(c) CENTRAL/STATEGOVERNMENT(S) 0 0 0 0.0000 0.0000 0 0.00(d) VENTURECAPITALFUNDS 0 0 0 0.0000 0.0000 0 0.00(e) INSURANCE COMPANIES 0 0 0 0.0000 0.0000 0 0.00 (f) FII’S 0 0 0 0.0000 0.0000 0 0.00 (g) FOREIGN VENTURE CAPITALINVESTORS 0 0 0 0.0000 0.0000 0 0.00 SUB TOTAL (B)(1) : 0 0 0 0.0000 0.0000 0 0.00B 2. Non-institutions(a) BODIES CORPORATE 38 1096041 1090541 11.23 11.23 0 0.00(b) INDIVIDUAL (i) (CAPITALUPTOTORs.1Lakh) 994 1365788 1343766 13.99 13.99 0 0.00(ii) (CAPITALGREATERTHANRs.1Lakh) 32 2184770 2184770 22.38 22.38 0 0.00(c) ANY OTHERS (Specify) (i) TRUSTS 0 0 0 0.0000 0.0000 0 0.00 (ii) CLEARINGMEMBER 6 3185 3185 0.03 0.03 0 0.00(iii) DIRECTORS/RELATIVES 0 0 0 0.0000 0.0000 0 0.00(iv) EMPLOYEE 0 0 0 0.0000 0.0000 0 0.00(v) NON RESIDENT INDIANS (NRI) 7 895850 895850 9.18 9.18 0 0.00 (vi) OVERSEAS BODIES CORPORATES 0 0 0 0.0000 0.0000 0 0.00 SUB TOTAL (B)(2) : 1077 5545634 5518112 56.84 56.84 0 0.00 Total Public Shareholding (B)=(B)(1) + (B)(2) 1077 5545634 5518112 56.84 56.84 0 0.00 Total (A) + (B) : 1087 9758000 9730478 100.00 100.00 0 0.00(C) Shares held by Custodians and against which Depository Receipts have been issued(a) SHARES HELD BY CUSTODIANS 0 0 0 0.0000 0.0000 0 0.00 SUB TOTAL (C)(1) : 0 0 0 0.0000 0.0000 0 0.00 Grand Total (A) + (B) + (C) 1087 9758000 9730478 100.00 100.00 0 0.00

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V. dISCLOSurES

(a) Related Party Transactions

Duringtheyear,therehavebeennomateriallysignificantrelatedpartytransactionsundertakenbytheCompanyunderSection188oftheCompaniesAct,2013andRegulation23ofSEBI(ListingObligationsandDisclosureRequirements)Regulations,2015thatmayhavepotentialconflictwiththeinterestoftheCompanyatlarge.

(b) Details of Non- complianceNo Penalty / strictures were imposed on the company by the Stock Exchange or SEBI or any statutory Authority or anymatterrelatedtotheCapitalmarketduringthelast3(Three)yearsexceptlevyoffineofRs.3420(inclusiveofservicetax)inoneinstancebyBSEfordelayinsubmissionofAnnualReportpertainingtofinancialyear2014-15.(c) Details of Compliance of Mandatory requirementsWe have complied with all the applicable mandatory requirements of clause 49 of the Listing AgreemententeredintowiththeStockExchangeandprovisionsofSEBI(ListingObligationsandDisclosureRequirements)Regulations, 2015.(d) Adoption of Non Mandatory requirementsi.OurFinancialStatementsarewithunmodifiedauditopinionandfreefromanyAuditqualification.ii. Our Internal Auditor reports directly to the Audit Committee. (e) Policy on Materiality of Related Party Transactions and on dealing with Related Party Transactions, as approved and adopted by the Board of Directors may be accessed on our Website at the link: http://www.vamaind.com/Policies/Related_Party_Transactions_Policy.pdf(f) Policy for determining material subsidiaries may be accessed on our Website at the link: http://www.vamaind.com/Policies/Material_Subsidiary_Determination_Policy.pdf(g) Prevention of Insider TradingIn accordance with the requirements of SEBI (Prohibition of Insider Trading) Regulations, 2015, the Company has instituted a comprehensive code of conduct for prohibition of insider trading in the Company’s shares. The Code requires pre-clearance for dealing in the Company’s shares and prohibits the purchase or sale of Company’s shares by the Directors andthe designated employees while in possessionof unpublished price sensitive information inrelation to the Company and during the periodwhen the Trading Window is closed.(h) Auditors Certificate on Corporate GovernanceWehave obtained a certificate from its StatutoryAuditors testifying complianceswith the provisions relatingto Corporate Governance laid out in the erstwhile listing agreement executed with the stock exchanges and ScheduleV of SEBI (ListingObligations andDisclosureRequirements)Regulations, 2015.The certificate isattached to this report.VI. mEANS OF COmmuNICATIONWe regularly interact with the shareholders through the multiple channels of communication such as publication of notices, results, annual Reports and the company’s website.(a) All the communication, may it be results or notices etc, by way of News Papers is published in Financial

Express (English) and Andhra Prabha (Telugu) dailies. (b) FinancialsarefurnishedtoBSELtd.withinthetimespecifiedunderclause41oftheListingAgreementand

Regulation33ofSEBI(ListingObligationsandDisclosureRequirements)Regulations,2015.(c) Nopresentationsweremadeto institutional investorsor to theanalystsduring thefinancialyearunder

review. (d) The company promptly informs Stock Exchange about all the price sensitive information and all such other

matters which in our opinion are material and relevant for the shareholders.(e) The Company’s website: www.vamaind.com Contains separate section for investors where shareholders

information is made available.

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CEO & CFO Certification[Pursuant to Clause 49(ix) of the Listing Agreement]

The Board of Directors VAMAIndustriesLimitedHyderabad.

We,V.A.RamaRaju,Chairman&ManagingDirectorandG.Siva,ChiefFinancialOfficerofVamaIndustriesLimited,to thebest of our knowledge and belief certify that:

A. WehavereviewedfinancialstatementsandthecashflowstatementofourCompanyforthefinancialyearended31st March, 2016 and that to the best of our knowledge and belief:

1) These statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;

2) These statements together present a true and fair view of our Company’s affairs and are in compliance with existing accounting standards, applicable laws and regulations.

B. There are, to the best of our knowledge and belief, no transactions entered into by our Company during theyear which are fraudulent, illegal or violative of the Company’s code of conduct.

C. WeacceptresponsibilityforestablishingandmaintaininginternalcontrolsforfinancialreportingandthatwehaveevaluatedtheeffectivenessofinternalcontrolsystemsofourCompanypertainingtofinancialreportingandthatwehavedisclosedtotheauditorsandtheauditcommittee,deficienciesinthedesignoroperationofsuchinternalcontrols, if any.

D. We have indicated to the auditors and the Audit committee

1) Significantchangesininternalcontroloverfinancialreportingduringtheyear;

2) Significantchangesinaccountingpoliciesduringtheyearandthatthesamehavebeendisclosedinthenotestothefinancialstatements;and

3) Instances of significant fraud of which they have become aware and the involvement therein, if any, ofthemanagementoranemployeehavingasignificantroleinthelistedentity’sinternalcontrolsystemoverfinancialreporting.

Sd/- Sd/- G. Siva V.A. rama raju ChiefFinancialOfficer ChairmanandManagingDirector12th August, 2016Hyderabad

dECLArATION ON COdE OF CONduCT

IherebydeclarethatalltheDirectorsandSeniorManagementpersonneloftheCompanyhaveaffirmedcompli-ancewiththeCompany’sCodeofConductforthefinancialyearendedMarch31,2016.

For VAmA Industries Limited Sd/-12th August, 2016 V A rama rajuHyderabad. Chairman & Managing Director

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AudITOrS’ CErTIFICATE ON COrPOrATE GOVErNANCE

TO THE MEMBERS OF VAMA INDUSTRIES LIMITED.

WehaveexaminedthecomplianceofconditionsofCorporateGovernancebyM/s.VamaIndustriesLimited(“theCompany”), for theyearendedMarch31,2016,asstipulated inClause49of theListingAgreement (“ListingAgreement”) of the Company with the stock exchanges for the period April 1, 2015 to November 30, 2015 and as per the relevant provisions ofSecurities andExchangeBoard of India (ListingObligations andDisclosureRequirements)Regulations,2015(“Listingregulations)”asreferredtoinRegulation15(2)oftheListingRegulations,for the period December 1, 2015 to March 31, 2016.

The compliance of conditions of corporate governance is the responsibility of the Management. Our examinationwas limited to the procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditionsofCorporateGovernance.Itisneitheranauditnoranexpressionofopiniononthefinancialstatementsof the Company.

In our opinion and to the best of our information and according to the explanations given to us, we certify that the CompanyhascompliedwiththeconditionsofCorporateGovernanceasstipulatedintheabovementionedListingAgreement/ListingRegulations,asapplicable.

We further state that such compliance is neither an assurance as to the future viability of the Company nor theefficiencyoreffectivenesswithwhichthemanagementhasconductedtheaffairsoftheCompany.

For GV & Co. Chartered Accountants Sd/- Grandhi Vittal12th August , 2016 M.NO: 206462 Hyderabad. Firm Reg No: 012875S

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Independent Auditor’s report

To the Members of M/s Vama Industries Limited

We have audited the accompanying standalone financial statements ofM/s Vama Industries Limited(‘the Company’), which comprise the balance sheet as at31stMarch2016, thestatementofprofitand lossandthecashflowstatementfortheyearthenended,andasummaryofsignificantaccountingpoliciesandother explanatory information.

Management’s Responsibility for the Standalone Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation and presentationofthesestandalonefinancialstatementsthatgiveatrueandfairviewofthefinancialposition,financialperformanceandcashflowsoftheCompanyin accordance with the accounting principles generally accepted in India, including the Accounting Standards specifiedunderSection133oftheAct,readwithRule7 of the Companies (Accounts) Rules, 2014. 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 effectivelyfor ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentationofthefinancialstatementsthatgiveatrueand 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 standalonefinancialstatementsbasedonouraudit.

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 thereunder.

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 aboutwhetherthefinancialstatementsarefreefrommaterial misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures inthefinancialstatements.Theproceduresselecteddepend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraudor error. In making those risk assessments, the auditor considers internal financial control relevantto the Company’s preparation of the financialstatements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overallpresentationofthefinancialstatements. We believe that the audit evidence we have obtained issufficientandappropriatetoprovideabasisforourauditopiniononthestandalonefinancialstatements.

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 theinformation 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 31 March2016anditsprofit&lossanditscashflowsforthe year ended on that date.

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 thematters specified in theparagraph 3 and 4 of the order.

2. As required by Section 143 (3) of the Act, we report that:

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(a) we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

(b) in our opinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

(c) the balance sheet, the statement of profit and

lossand thecashflowstatementdealtwithbythis Report are in agreement with the books of account;

(d) in our opinion, the aforesaid standalone financialstatementscomplywiththeAccountingStandardsspecifiedunderSection133oftheAct,read with Rule 7 of the Companies (Accounts) Rules, 2014;

(e) on the basis of the written representations received from the directors as on 31 March 2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31March2016 from being appointed as a director in terms of Section 164 (2) of the Act;

(f) with respect to the adequacy of the internal financial controlsover financial reportingof theCompany and the operating effectiveness of such controls, refer to our separate report in “Annexure B”; and

(g) with respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the 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 does not have any pending litigationswhichwould impact itsfinancialposition.

ii) the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses; and

iii) there were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

For GV & Co. Chartered Accountants

Sd/- Grandhi Vittal Proprietor M.No. 206462 Firm Reg.No. 012875S

Place : HyderabadDate : 30.05.2016

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Annexure -A to the Auditor’s Report

The Annexure referred to in Independent Auditors’ Report to the members of the Company on the standalonefinancialstatementsfortheyearended31March 2016, we report that:

(i) a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixedassets.

b) These fixed assets have been physicallyverifiedby themanagementat reasonableintervals and no material discrepancies were noticed on such verification and thesame have been properly dealt with in the books of account.

c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

(ii) a) The inventory has been physically verifiedby the management during the year. In ouropinion, the frequencyofverification isreasonable.

b) In our opinion, the procedures of physical verification of inventory followed by themanagement are reasonable and adequate in relation to the size of the Company and nature of its business.

c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory ascompared to book records were not material.

(iii) a) The company has not granted any loans, securedorunsecuredtocompanies,firms,Limited Liability Partnerships or otherparties covered in the register maintained under section 189 of the Companies Act, 2013.

b) In case of loans granted to companies, firms,LimitedLiabilityPartnershipsorotherparties listed in the register maintained under section 189 of the Act, the borrowers have been regular in the payment of interest as stipulated. The terms of arrangements do not stipulate any repayment schedule and the loans are repayable on demand. Accordingly, paragraph 3 (iii) (b) of the order is not applicable to the company in respect of repayment of principal amount.

c) There are no overdue amounts in respect of the loans granted to companies, firms,Limited Liability Partnerships or otherparties listed in the register maintained under section 189 of the Companies Act, 2013 (The Act).

(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of section 185 and 186 of the Act, with respect to the loans, investments, guaratntee and security made.

(v) In our opinion, and according to the information and explanations given to us, the Company has not accepted deposits from the public during the year. Therefore the provisions of Clause 3 (v) of the Order are not applicable to the Company.

(vi) The maintenance of cost records has not been prescribed by the Central Government under section 148(1) of the Companies Act, 2013 in respect of the Company’s operations. Therefore the provisions of Clause 3 (vi) of the Order are not applicable to the Company.

(vii) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including provident fund, employee state insurance, income-tax, sales tax, value added tax, duty of customs, service tax, cess and other material statutory dues have been regularly deposited during the year by the Company with the appropriate authorities.

Annexure - A to the Auditor’s Report

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According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employee state insurance, income-tax, sales tax, value added tax, duty of customs, duty of excise, service tax, cess and other material statutory dues were in arrears as at 31 March 2016 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no material statutory dues including income tax, sales tax, service tax, duty of customs, duty of excise,value added tax, cess and any other material statutory dues pending for deposit with the appropriate authorities on account of any dispute.

(viii) Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has notdefaulted in repaymentof dues to financialinstitutions, banks and debenture holders.d

(ix) The Company did not raise any money by way of initial public offer or further public offer (including debt instruments). The Company has raised new term loans during the year. The term loans outstanding at the beginning of the year and those raised during the year have been applied for the purposes for which they were raised.

(x) According to the information and explanations given to us, no material fraud by the Company orontheCompanybyitsofficersoremployeeshas been noticed or reported during the course of our audit.

(xi) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us, the Company is

not a nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.

(xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financialstatementsasrequiredbytheapplicableaccounting standards.

(xiv) According to the information and explanations

given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of preference shares or fully or partly convertible debentures during the year. However, the Company has made preferential allotment of 12,20,000 equity shares during the year and complied with the requirements of Section 42 of Companies Act, 2013.

(xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.

(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.

For GV & CoChartered Accountants

Sd/-Grandhi Vittal ProprietorM.No. 206462 Firm Regn No. 012875S

Place: HyderabadDate : 30.05.2016

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Annexure - B to the Auditors’ Report

report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)

Wehaveaudited the internalfinancial controlsoverfinancial reporting of M/s Vama Industries Limited(“the Company”) as of 31 March 2016 in conjunction withourauditofthestandalonefinancialstatementsof the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishingandmaintaininginternalfinancialcontrolsbasedontheinternalcontroloverfinancialreportingcriteria 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 (‘ICAI’). These responsibilities include the design, implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the orderlyandefficientconductofitsbusiness,includingadherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under theCompanies Act, 2013.

Auditors’ responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls over financialreporting 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 financialcontrols, 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 Note 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 reportingwas 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 financialreporting and their operating effectiveness. Our audit of internal financial controls over financialreporting included obtaining an understanding of internalfinancialcontrolsoverfinancialreporting,assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of thefinancialstatements,whetherdue to fraudor error.

We believe that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the Company’s internal financial controls system over financialreporting.

meaning of Internal Financial Controls over Financial reporting

A company’s internal financial control overfinancialreportingisaprocessdesignedtoprovidereasonable assurance regarding the reliability of financialreportingandthepreparationoffinancialstatements for external purposes in accordance with generally accepted accounting principles. A company’sinternalfinancialcontroloverfinancialreporting includes those policies and procedures that (1) pertain to the maintenance of records that, inreasonabledetail,accuratelyandfairlyreflectthetransactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparationoffinancialstatementsinaccordancewith generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financialstatements.

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Inherent Limitations of Internal Financial Controls Over Financial reporting

Because of the inherent limitations of internal financial controls over financial reporting, includingthe possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projectionsofanyevaluationof the internalfinancialcontrolsoverfinancialreportingtofutureperiodsaresubject to the risk that the internal financial controlover financial reporting may become inadequatebecause of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system overfinancialreportingandsuchinternalfinancialcontrolsoverfinancial reportingwereoperatingeffectivelyasat 31 March 2016, based on the internal control over financialreportingcriteriaestablishedbytheCompanyconsidering 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.

For GV & Co.,Chartered Accountants

GrandhiVittalProprietorM.No. 206462 Firm Regn No. 012875S

Place : Hyderabad Date : 30 May’2016

91

I. EQuITY ANd LIABILITIES Shareholders’funds (a) Share capital 1 9,75,80,000 8,23,80,000 (b) Reserves and surplus 2 4,64,85,730 2,06,04,180 (c) Money received against share warrants 1,44,00,000 18,00,000 15,84,65,730 10,47,84,180 Share application money pending allotment 3 - - Non-current liabilities (a)Long-termborrowings 4 1,15,51,853 17,37,196 (b) Deferred tax liabilities (net) - - (c) Other long-term liabilities 5 - - (d)Long-termprovisions 6 - - 1,15,51,853 17,37,196 Current liabilities (a) Short-term borrowings 7 5,49,77,384 4,68,10,194 (b) Trade payables 8 13,85,72,782 8,08,97,835 (c) Other current liabilities 9 1,25,24,429 95,36,458 (d) Short-term provisions 10 32,36,859 81,12,443 20,93,11,454 14,53,56,930 TOTAL 37,93,29,037 25,18,78,306 II. ASSETS Non-current assets (a) Fixed assets 11 (i) Tangible assets 2,28,89,936 60,76,707 (ii) Intangible assets 60,45,588 69,40,630 (iii) Capital work-in-progress 42,30,050 - (iV) Intangible assets under development 75,94,635 - 4,07,60,209 1,30,17,337 (b) Non-current investments 12 - - (c) Deferred tax assets (net) 7,30,026 3,93,993 (d)Long-termloansandadvances 13 56,92,738 62,95,257 (e) Other non-current assets 14 2,37,43,954 1,56,08,596 3,01,66,718 2,22,97,846 Current assets (a) Current investments - - (b) Inventories 15 10,11,54,018 3,60,06,310 (c) Trade receivables 16 17,32,56,851 14,78,42,853 (d) Cash and bank balances 17 1,68,88,966 2,21,12,509 (e) Short-term loans and advances 18 1,64,88,349 1,02,12,780 (f) Other current assets 19 6,13,926 3,88,671 30,84,02,110 21,65,63,123 TOTAL 37,93,29,037 25,18,78,306 III. NOTES FORMING PART OF FINANCIAL STATEMENTS 27 - 43 The Schedules referred to above and the notes forming part of the accounts form an integral part of Balance Sheet

As at As atParticulars Note No. 31.03.2016 31.03.2015 Amount in ` Amount in `

Place : HyderabadDate : 30-05-2016

Balance Sheet as at march 31, 2016

As per my report of even dateFor G.V &Co.,Chartered AccountantsSd/-Grandhi VittalProprietorMembership No. 206462Firm Regn No. 012875S

for and on behalf of the Board of Directors Sd/- Sd/- V. Atchyuta rama raju V. rajam raju Managing Director Executive Director

Sd/- Sd/- G. Siva Rohit Tibrewal ChiefFinancialOfficer CompanySecretary

92

I. Revenue from operations 20 45,86,35,743 48,52,90,180 II. Other income 21 15,61,438 16,78,015 III. TOTAL REVENUE ( I + II) 46,01,97,181 48,69,68,195 IV. Expenses: (a) Cost of Material Consumed (b) Purchase of Stock -in- Trade 22 45,49,67,559 39,01,20,849 (c)Changesininventoriesoffinishedgoods, work-in-progress and stock-in-trade 23 (6,51,47,708) 79,62,639 (d)Employeebenefitexpenses 24 3,44,39,954 3,47,90,645 (e) Finance costs 25 1,12,91,447 65,70,539 (f) Depreciation and amortization expenses 11 24,34,033 30,50,459 (g) Other Expenses 26 1,81,29,540 2,93,25,061 45,61,14,825 47,18,20,192 TOTAL EXPENSES V. Profitbeforeexceptional&extraordinaryitemsandtax(III-IV) 40,82,356 1,51,48,003VI. Exceptional items - 52,70,000 VII. Profitbeforeextraordinaryitemsandtax(V-VI) 40,82,356 98,78,003VIII. Extraordinary items - - IX. Profitbeforetax(VII-VIII) 40,82,356 98,78,003X. Tax expense: Provision for Income Tax Current Year 19,07,340 54,39,810 Provision for Deferred Tax (3,36,033) (5,80,734) Total Tax Expenses 15,71,307 48,59,076 XI. Profitfortheperiodfromcontinuingoperations(IX-X) 25,11,049 50,18,927XII. Profitfromdiscontinuingoperations(beforetax) - -XIII. Tax expense of discontinuing operations - - XIV.Profitfromdiscontinuingoperations(aftertax)(XII-XIII) - -XV. Profitfortheperiod(XI+XIV) 25,11,049 50,18,927XVI. Earnings per equity share: 1) Basic 0.27 0.66 2) Diluted 0.27 0.66 XVII. NOTES FORMING PART OF THE FINANCIAL STATEMENTS 27 - 43TheSchedulesreferredtoaboveandthenotesformingpartoftheaccountsformanintegralpartofProfit&LossA/c.

As at As atParticulars Note 31.03.2016 31.03.2015 No. Amount in ` Amount in `

Statement of Profit and Loss Account for the year ended march 31, 2016

As per my report of even dateFor G.V &Co.,Chartered AccountantsSd/-Grandhi VittalProprietorMembership No. 206462Firm Regn No. 012875S Place : HyderabadDate : 30.05.2016



93

As at 31.03.2016 As at 31.03.2015 Amount in ` Amount in `

Cash Flow Statement for the year ended march 31, 2016

As per my report of even dateFor G.V &Co.,Chartered AccountantsSd/-Grandhi VittalProprietorMembership No. 206462Firm Regn No. 012875S

Particulars

1. The above Cash Flow Statement has been prepared under the Indirect Method as set out in Accounting Standard 3 on Cash Flow Statementsnotifiedundersection133oftheCompaniesAct,2013.

2. PreviousYearFigureshavebeenregrouped/reclassified/rearrangedwherevernecessary.

for and on behalf of the Board of Directors Sd/- Sd/- V. Atchyuta rama raju V. rajam raju Managing Director Executive Director Sd/- Sd/- G. Siva Rohit Tibrewal ChiefFinancialOfficer CompanySecretary

A. Cash Flow from Operating activities NetProfitbeforetaxasperProfitandlossaccount 40,82,356 98,78,003 Adjustments (Profit)/Lossonsaleoffixedassets(net) - (1,28,397) (Profit)/Lossonsaleofinvestments(net) - 52,70,000 Depreciation and Amortisation Expense 24,34,033 30,50,459 Preliminary Expenditure Written Off - - Other Income (15,61,438) (15,49,618) Finance Costs 1,12,91,447 65,70,539 Effect on Exchange Rate Change - - 1,62,46,398 2,30,90,986 (Increase)/Decrease in Trade and Other Receivables (2,54,13,998) (10,25,19,426) (Increase)/Decrease in Inventories (6,51,47,708) 79,62,639 ChangesinShortTermLoans&Advances (31,83,049) (15,14,947) (Increase)/Decrease in Fixed Deposits having original maturity over 3 months 1,94,214 (4,49,148) Changes in Other Current Assets (2,25,255) (1,59,915) Increase/(Decrease) in Trade Payables 5,76,74,947 6,35,98,687 Increase/(Decrease)inOtherCurrentLiab./ShortTermProv. (31,43,426) 47,04,079Cash generated from Operations (2,29,97,877) (52,87,045) Direct Taxes paid (30,92,520) (10,30,000)Net Cash from Operating activities (2,60,90,397) (63,17,045)B. Cash flow from Investing Activities (Purchase) / Sale of Fixed Assets (Net) (1,83,52,223) (20,73,601) Capital Work-in-progress (1,18,24,685) - (Purchase) / Sale of Investments (Net) - 1,10,000 Acquisition of Companies - - ChangesinLongTermLoans&Advances 6,02,519 (8,38,826) Changes in Other Non Current Assets (81,35,358) (63,72,808) (Increase)/DecreaseinOtherLongTermLiab./LongTermProv. Other Income 15,61,438 15,49,618 Cashflowbeforeexceptionalitems (3,61,48,309) (76,25,617) Exceptional Items - - Net Cash from Investment Activities (3,61,48,309) (76,25,617)C. Cash Flow from Financing Activities Proceeds from issue of Share Capital/ Share Application Money 5,28,00,000 1,62,00,000 Proceeds/(Repayment)fromLongTermBorrowings 98,14,657 17,37,196 Proceeds / (Repayment) from Short Term Borrowings 81,67,190 2,22,00,771 Finance Costs (1,12,91,447) (65,70,539) Dividends Paid (19,51,600) (7,03,800) Dividend tax paid (3,29,423) (1,19,611) Effect on Exchange Rate Change - - Net cash used in financing activities 5,72,09,377 3,27,44,016Net (Decrease) / Increase in cash and cash equivalents (50,29,329) 1,88,01,354Cash and cash equivalents at the beginning of the year 2,11,08,530 23,07,176Cash and Cash equivalents at the end of the year 1,60,79,201 2,11,08,530Short Term Bank Deposits 8,09,765 10,03,979Cash and Bank Balances at the end of the year 1,68,88,966 2,21,12,509


94

STATEMENT OF CHANGES IN EQUITY DURING THE FINANCIAL YEAR ENDED 31ST MARCH, 2016

Sl. No. Particulars As on 01.04.2015 Increase / decrease As on 31.03.2016 during the Year

No of Amt (Rs.) No of Amt (Rs.) No of Amt (Rs.) Shares Shares Shares

1. Authorised Capital Equity Shares of Rs. 10/- each with Voting Rights 90,00,000 9,00,00,000 20,00,000 2,00,00,000 11,000,000 11,00,00,000

2. Issued, Subscribed and Paid up Equity Shares of Rs. 10/- each fully paid up with Voting Rights. 82,38,000 8,23,80,000 1,520,000 15,200,000 97,58,000 9,75,80,000

For G.V. & Co., For and on behalf of the Board of Directors Chartered Accountants

Sd/- Sd/- Sd/-Grandhi Vittal V. Atchyuta rama raju V. rajam rajuProprietor Chairman and Managing Director Executive Director M. No.206462Firm Regn. No.012875S Sd/- Sd/-Place: Hyderabad G. Siva Rohit TibrewalDate:30.05.2016 ChiefFinancialOfficer CompanySecretary

95

Notes forming part of Financial Statements As At 31.03.2016

Note No. 1 : SHARE CAPITAL

Sl Particulars As At 31.03.2016 As At 31.03.2015 No. Number Amount Number Amount

Authorised (i) Equity Shares of Rs. 10/- each with Voting Rights 1,10,00,000 11,00,00,000 90,00,000 9,00,00,000 Issued, Subscribed and Paid up (i) Equity Shares of Rs. 10/- each fully paid up 97,58,000 9,75,80,000 82,38,000 8,23,80,000

with Voting Rights Total 97,58,000 9,75,80,000 82,38,000 8,23,80,000

(a) Reconciliation of number of shares:

Sl Particulars As At 31.03.2016 As At 31.03.2015 No. Number Amount Number Amount

1 Equity Shares outstanding at the beginning of the year 82,38,000 8,23,80,000 70,38,000 7,03,80,000 2 Equity Shares Issued during the year 15,20,000 1,52,00,000 12,00,000 1,20,00,000 3 Equity Shares bought back during the year - - - - 4 Equity Shares outstanding at the end of the year 97,58,000 9,75,80,000 82,38,000 8,23,80,000

(b) Rights, preferences and restrictions attached to shares: The company has one class of equity shares having a par value of Rs.10/- each. Each shareholder is eligible for one vote per share held. The dividend proposed by the board of directors is subject to the approval of the shareholders in the ensuing Annual General Meeting except in the case of interim dividend. In the event of liquidation, the equity sharesholders are eligible to receive the remaining assets of the company after distribution of all preferential amounts, in proportion to their shareholding. (c) Details of shares held by Shareholders holding more than 5 % of the shares in the company:

Sl Particulars As At 31.03.2016 As At 31.03.2015No. Amount in ` Amount in ` No. of Shares % of Holding No. of Shares % of Holding Held Held Equity Shares with Voting rights 1 V AtchyutaRamaRaju 22,11,024 22.66% 20,61,024 25.02%2 VRajamRaju 11,60,500 11.89% 11,60,500 14.09%3 GottimukkalaAchyutaRamaRaju 5,99,442 6.14% 5,99,442 7.28%4 NirantTechnologiesPrivateLimited 5,00,000 5.12% 5,00,000 6.07%5 AnilUnniKrishanan 8,90,000 9.12% - -

(d) Aggregate number and class of shares allotted as fully paid up for consideration otherthan cash, bonus shares and shares bought back for the period of 5 years immediately preceding the Balance Sheet date

Sl Particulars No. of shares No. of shares No As At 31.03.2016 Amount in ` As At 31.03.2015 Amount in `

Nil Nil

Amount in `

Clause (e), (f), and (h) to (l) of the Note 6(A) to the Schedule III of the Companies Act,2013 is not applicable.

96

Note No : 2 reserves & Surplus

Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in `

Securities Premium Account Opening Balance 24,00,000 - Add: Premium on shares issued during the year 2,50,00,000 24,00,000 Less:Utilisedduringtheyear - - Closing Balance 2,74,00,000 24,00,000 Profit and Loss Account As per last Balance Sheet 1,82,04,180 1,57,71,489 (+)NetProfitforthecurrentyear 25,11,049 50,18,927 (-) Transfer from Reserves - - (-) Adjustment to Fixed Assets(Refer Note 11) - 6,09,213 (-) Proposed Dividends 10,50,800 16,47,600 (-) Tax on Dividend 2,13,917 3,29,423 (-) Dividends for (FY 2014-15) 3,04,000 - (-) Tax on Dividend (FY 2014-15) 60,782 - Closing Balance 1,90,85,730 1,82,04,180 Total 4,64,85,730 2,06,04,180

Note related to previous year FY 2014-15 : PursuanttotheenactmentofCompaniesAct2013,thecompanyhasappliedtheestimateduseful livesasspecifiedin Schedule II, except in respect of certain assets as disclosed in Accounting Policy on Depreciation, Amortisation and Depletion. Accordingly the unamortised carrying value is being depreciated / amortised over the revised/remaining useful lives. The written down value of Fixed Assets whose lives have expired as at 1st April 2014 have been adjusted, intheopeningbalanceofProfitandLossAccountamountingtoRs.6.09lakhs

Note No : 3 Share Application money pending allotment - -

- -

Note No : 4 Long Term Borrowings


Secured VehicleLoansfromBanks** 22,87,486 17,37,196 Unsecured

LoansfromFinancialInstituitions* 92,64,367 -

1,15,51,853 17,37,196

*TheCompanyavailedUnsecuredBusinessLoansfromNonBankingFinancialInstitutions(forDetailsReferNoteNo.37)**Vehiclesloansaresecuredbyhypothecationofvehiclesfinancedbyrespectivebanks.(FordetailsReferNoteNo.37)

97

Note No : 5 Other Longterm Liabilities


OtherLiabilites - - - - Note No : 6 Long Term Provisions


Provisions - Others - -

- - Note No : 7 Short Term Borrowings


Secured LoansrepayableondemandfromBanks** 5,49,77,384 4,68,10,194 LoansrepayableondemandfromOthers - - Unsecured LoansfromRelatedParties - - OtherLoansandAdvances - - 5,49,77,384 4,68,10,194 **WorkingCapitalloansaresecuredbyhypothecationofStocks&Receivables(present&future)oftheCompany

(For details Refer Note No. 37) Note No : 8 Trade Payables


DuestoMicro,SmallandMediumEnterprises* - - Dues to Others 13,85,72,782 8,08,97,835 13,85,72,782 8,08,97,835 *ThedetailsofamountsoutstandingtoMicro,SmallandMediumEnterprisesbasedonavailableinformationwiththecompany is as under:

98

Principal amount due and remaining unpaid - - Interest due on above and the unpaid interest - - Interest paid - - Payment made beyond the appointed day during the year - - Interest due and payable for the period of delay - - Interest accrued and remaining unpaid - - Amount of further interest remaining due and payable in succeeding years - -

The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties havebeenidentifiedonthebasisofinformationavailablewiththecompany.Thishasbeenrelieduponbytheauditors. Note No : 9 Other Current Liabilities


CurrentMaturitiesofLongTermDebt(Secured) LoansfromFinancialInstituitions* 52,81,979 - VehicleLoansfromBanks 4,16,676 3,54,764 InterestAccruedButnotDueonBorrowings** - Advances received from Customers - 1,46,014 OtherPayables*** 68,25,774 90,35,680 1,25,24,429 95,36,458 *TheCompanyavailedUnsecuredBusinessLoansfromNonBankingFinancialInstitutions(forDetailsReferNoteNo.37)***OtherPayablesinclude StatutoryLiabilities 31,29,954 54,26,723 Rent Creditors 1,36,150 6,06,138 Expenses Payable 33,02,513 30,02,819 Note No : 10 Short Term Provisions


Provisions - Others : Provision for Taxes 19,11,360 61,35,420

Provision for proposed dividend 10,50,800 16,47,600 Provision for tax on proposed dividends 2,74,699 3,29,423 32,36,859 81,12,443

99

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-

-

-

-

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-

-

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d 11

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3 26

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-

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12,05

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1,00

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1,27

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6 -

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18

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0 39

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7 34

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7

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8 69

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101

Note No : 12 Non Current Investments

Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in ` A. Trade Investments B. Other Investments Quoted unquoted Investment Property Investment in equity instruments (i) of subsidiaries (ii) of associates - - (iii) of joint venture companies - - (iv) of controlled special purpose entities - - (v) of other entities - -

Investment in preference shares (i) of subsidiaries (ii) of associates - - (iii) of joint venture companies - - (iv) of controlled special purpose entities - - (v) of other entities - - Investment in government or trust securities - - Investment in debentures or bonds - - Investment in mutual funds (give details) - - Investmentinpartnershipfirms - - Grand Total - - unquoted Investments

102

Note No : 13 Long Term Loans & Advances


(a) Capital Advances Secured, considered good - - Unsecured, considered good 50,000 - Doubtful - - (b) Security Deposits - - (c) Loans&Advancestorelatedparties - -(d) Loans&AdvancestoEmployees - -(e) Prepaid Expenses - - (f) Advance Income Tax (Unsecured, Considered good) 16,33,238 22,85,757 (g) MAT Credit Entitlement - - (h) Balances with Government Authorities - - (i) OtherLoans&Advances 4,009,500 4,009,500 Secured, considered good - - (j) Unsecured, considered good - - Doubtful - - 56,92,738 62,95,257 Less:Provisionforotherdoubtfulloans&advances - - 56,92,738 62,95,257

Note: Long Term Loans & Advances include amounts due from Directors - - OtherOfficersofcompany - -Firms in which any director is a partner - - Private companies in which any director is a director or member - -

Note No : 14 Other Non-Current Assets

Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in `(a) Other Non-current Assets FixedDeposits* 56,57,450 52,81,053 Electricity Deposits 95,897 95,897 Rent Deposit 24,01,728 28,03,160 Telephone Deposit 24,745 24,745 Sales Tax Appeal Deposit - - Retention Money 1,55,59,834 73,99,441 OtherDeposits** 4,300 4,300 2,37,43,954 1,56,08,596 OtherDepositsinclude** Internet Deposit 1,000 1,000 Gas Deposit 3,300 3,300 *DepositsincludeRs.55,53,334/-(PreviousYearRs.52,28,547/-)withSBIheldaslienagainstBankGuarnateesissued by SBI on behalf of the company. *DepositsincludeRs.57,719/-(PreviousYearRs.41,000/-)withSBIheldassecuritydepositwithCentralExciseDepartment

103

Note No : 15 Inventories: Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in `

(a) Raw materials Goods-in-transit - - (b) Work-in-progress - - Goods-in-transit - - (c) Finished goods (other than those acquired for trading) - - Goods-in-transit - - (d)Stock-in-trade(acquiredfortrading)* 10,11,54,018 3,60,06,310 Goods-in-transit - - (e) Stores and spares - - Goods-in-transit - - (f) Loosetools - - Goods-in-transit - - (g) Others (Specify nature) - -

Goods-in-transit - - 10,11,54,018 3,60,06,310

* mode of valuation: Stock-in-trade : At cost or NRV whichever is lower

Note No : 16 Trade Receivables


Trade receivables outstanding for a period exceeding six months from the date they were due for payment Secured, considered good - - Unsecured, considered good 2,41,57,585 2,37,86,790 Doubtful - - Trade receivables outstanding for a period lessthan six months Secured, considered good - - Unsecured,consideredgood* 14,90,99,266 12,40,56,063 Doubtful - - 17,32,56,851 14,78,42,853 Less:Provisionfordoubtfultradereceivables - - 17,32,56,851 14,78,42,853 Trade receivables include debts due from: Directors - - OtherofficersoftheCompany - - Firms in which any director is a partner (givedetailsperfirm) - - Private companies in which any director is a director or member (give details per company) - -

*ItincludesIncomeaccruedbutnotbillsraisedtotheextentofRs.1,08,93,563/-(PreviousYearRs.1,04,53,397/-)

104

Note No : 17 Cash and Bank Balances


(a) Cash and Cash Equivalents (i)Balances with banks; In Current Accounts 1,19,09,362 1,78,03,484 (ii)Cheques, drafts on hand 39,65,763 26,78,670 (iii)Cash on hand 2,04,076 6,26,376 (b) Other Bank balances InDepositAccounts** 8,09,765 10,03,979 1,68,88,966 2,21,12,509

**DepositsincludeRs.7,20,200/-(PreviousYearRs.8,69,027/-)withSBIheldaslienagainstBankGuarnateesissuedby SBI on behalf of the company. Note No : 18 Short Term Loans & Advances


(a)Loans&Advancestorelatedparties - - (b) Security deposits 20,50,409 5,93,509 (c)Loansandadvancestoemployees Secured, considered good 81,08,017 34,96,198 Unsecured, considered good - - Doubtful - - (d) Prepaid expenses - Unsecured, consideredgood** 10,94,171 15,54,395 (e) Balances with government authorities - - Unsecured, considered good - - Advance Tax and TDS 23,68,888 27,40,699 Service Tax Input / Input VAT 3,62,928 1,33,135 (f) Inter-corporate deposits - - (g) MAT Credit entitilement - Unsecured, considered good - - (h)OtherLoans&Advances*** - Secured, considered good - - Unsecured, considered good 25,03,936 16,94,844 Doubtful - - 1,64,88,349 1,02,12,780 Less:Provisionforotherdoubtful loans and advances - - 1,64,88,349 1,02,12,780

105

Note: Short Term Loans & Advances include amounts due from Directors - - OtherOfficersofcompany - - Firms in which any director is a partner - - Private companies in which any director is a director or member - - **“PrepaidExpenses”pertainstoInsurance, Annual Maintenance Contracts. OtherLoans&Advancesincludes*** Advances to Suppliers 24,75,219 16,94,844 Other Advances 28,717 -

Note No : 19 Other Current Assets


(a) Unbilled revenue - - (b) Unamortised expenses - - (c) Accruals - - (d)OtherCurrentAssets* 6,13,926 3,88,671

6,13,926 3,88,671 *OtherCurrentAssetsinclude Interest Accrued But Not due on FDs 6,13,926 3,88,671

106

Note No. : 20 revenue from operations


Sale of products Domestic 41,39,71,938 43,10,88,542 Service Income Domestic 3,03,62,065 4,83,93,538 Export 1,43,01,740 58,08,100 45,86,35,743 48,52,90,180 Sales of traded goods under broad heads: Description FY 2015-16 FY 2014-15Computers & Peripherals 41,39,71,938 43,10,88,542 Total 41,39,71,938 43,10,88,542 Services rendered under broad heads:

description FY 2015-16 FY 2014-15

Annual Maintenance Contract Services 1,11,12,440 4,04,23,436 Consultancy Services 1,92,49,625 79,70,102 IT Engineering Services 1,43,01,740 58,08,100

Total 4,46,63,805 5,42,01,638

Note No. : 21 Other income

Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in ` Interest on Fixed Deposits 6,51,443 4,18,768 Interest on Others 11,836 3,85,762 Other Income 8,98,159 7,45,088 ProfitonsaleofFixedAsset - 1,28,397 15,61,438 16,78,015 Note No : 22 Purchase of Stock -in- Trade

Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in ` Purchase of Material 44,50,11,985 38,91,82,911 TranportCharges/LabourCharges/AMCCharges 99,55,574 9,37,938

45,49,67,559 39,01,20,849

107

Purchases of traded goods under broad heads:

description FY 2015-16 FY 2014-15

Computers & Peripherals 44,50,11,985 38,91,82,911 Total 44,50,11,985 38,91,82,911

Note No : 23 Changes in inventories of finished goods, work-in-progress and stock-in-trade

Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in ` Inventories at the end of the year: Finished goods (acquired for trading) 10,11,54,018 3,60,06,310 Work-in-progress - - Stock-in-trade - - 10,11,54,018 3,60,06,310 Inventories at the beginning of the year: Finished goods (acquired for trading) 3,60,06,310 4,39,68,949 Work-in-progress - - Stock-in-trade - - 3,60,06,310 4,39,68,949 Net increase / (decrease) 6,51,47,708 (79,62,639)

Note No : 24 Employee benefit expenses

Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in ` Salaries and Wages 3,00,18,965 2,91,71,659 Directors Remuneration 19,80,000 37,80,000 Contributiontoprovidentandotherfunds* 21,86,479 16,93,734Staff Welfare Expenses 2,54,510 1,45,252

3,44,39,954 3,47,90,645 *itincludescontributiontoEmployeeprovidentfund,EmployeeStateInsuranceScheme.

108

Note No : 25 Finance costs


Interest Expense Interest 75,94,649 47,82,289

Interestonothers* 21,70,665 6,15,176 Other Borrowing Costs: LoanProcessingCharges 3,52,562 11,350 Other Finance Expenses: Bank charges 11,73,571 11,61,724 1,12,91,447 65,70,539

*includesInterestonTDS,ServiceTax,VAT&PaymentstoSuppliers

Note No : 26 Other Expenses

Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in ` Advertisement 12,80,239 98,521 Audit Fee 1,00,000 1,00,000 Business Promotion Exp. 6,20,163 11,66,235 Commission 22,92,410 7,38,316 Communication Expenses 5,83,467 5,15,512 Conveyance 8,96,325 7,03,355 Power and Fuel 7,06,981 5,63,752 Fees and taxes 8,59,839 4,42,706 Forex Fluctuations 20,52,481 16,45,811 Office&GeneralExp 7,63,072 6,51,808 Insurance 4,83,546 4,93,152 LegalandProfessionalexp. 29,40,715 1,73,97,026 Printing and stationery 2,40,586 1,67,607 Postage and Telegram 1,33,279 41,842 Rent 25,50,922 22,19,100 Repairs and Maintenance 4,84,238 18,80,907 STPI Service charges 55,000 57,809 Travelling Expenses 10,08,569 2,85,442 Vehicle Maintenance 77,708 1,56,160

1,81,29,540 2,93,25,061

109

NOTES TO FINANCIAL STATEmENTS

27. SIGNIFICANT ACCOUNTING POLICIES:

Basis of preparation of Financial Statements

The accompanyingfinancialstatementsarepreparedandpresentedinaccordancewithIndianGenerallyAcceptedAccounting Principles (GAAP) under historical cost convention on the accrual basis. GAAP comprises mandatory Accounting Standards issued by the Institute of Chartered Accountants of India, the provisions of the Companies Act, 2013 and guidelines issued by the Securities and Exchange Board of India. Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to existing accounting standard requires the change in the accounting policy hitherto in use.

Management evaluates all relevant issues or revised accounting standards on an ongoing basis.

Revenue Recognition

♣ Revenuefromsaleofcomputerhardwareisrecognizedondispatchoftheproductsfromthecompanyfordelivery to the customers. Revenue from product sale is shown net of Sales Tax separately charged and discounts as applicable.

♣ Revenue from ITServices consists of earnings fromservicesperformedona ‘timeandmaterial’ basisandfixedpricecontracts.Therelatedrevenueisrecognizedasandwhentheservicesareperformedanddelivered.

♣ RevenuefromAnnualMaintenanceContracts(AMCs’)isrecognizedonaccrualbasisaspertheContracts/ Agreements entered with the Clients.

♣ Otherincomeisrecognizedonaccrualbasis.

Translation of Foreign Currency Transactions

Transactionsinforeigncurrencyarerecordedatexchangerateprevailingonthedateoftransaction.Gain/Lossof foreign exchange on settlement of transaction arising on receipt of the amounts receivable, are recognized as income or expense for the period. In all other cases gain or loss is accounted for on the realizable value as on last dayofthefinancialyear.

Expenditure

All expenditure and costs are recognized on accrual basis and due provision is made for all the known losses and liabilities.

Fixed Assets, Work in progress and depreciation

♣ FixedAssetsarestatedatcostofacquisitionandanycostattributableforbringingtheassettotheconditionforitsintendeduselessDepreciationforthefinancialyear.

♣ Interestarisingonacquisitionoffixedassetsonhirepurchaseischargedtoprofitandlossaccount.

♣ AsonthedateoftheBalanceSheet,thecostoffixedAssetspurchasedandnotreadyforuseareshownunder Capital Work-In Progress.

110

♣ Depreciation

Fixed assets are stated at cost less depreciation. Cost of acquisition is inclusive of freight, taxes and instal-lation.Depreciationonassetsisprovided,pro-ratafortheperiodofuse,bytheStraightLineMethod(SLM)at the rates prescribed in Schedule II of the Companies Act, 2013.

Investments

Investments are intended to be held for long term and are valued at cost of acquisition. Investments are carried at cost and provision is made to recognize any decline, other than temporary, in the value of such investments. The market value of the Investments is not available as it is not a quoted share.

Inventories

Inventories are valued at lower of cost or net realizable value. Cost of hardware and software purchased for resale areconsideredusingthefirst-in-first-outmethod.

Employee Benefits

Contributions to Provident Fund, Employees State Insurance are charged as incurred on accrual basis. The liabil-ityforretirementbenefitsofemployeeswillbeaccountedforonaccrualbasis.

Income Tax

Income taxes are accounted for in accordance with AS-22, namely “Accounting for taxes on Income” issued by ICAI. Taxes comprise both current and deferred tax.

Current tax is measured at the amount expected to be paid / recovered from the revenue authorities, using the applicable tax rates and laws.

The tax effect of the timing differences that result between taxable income and accounting income and are capable of reversal in one or more subsequent periods are recorded as a deferred tax asset or deferred tax liability. De-ferred tax assets and liabilities are recognized for future tax consequences attributable to timing differences. They are measured using the substantively enacted tax rates and tax regulations. The carrying amount of deferred tax assetsateachbalancesheetdateisreducedtotheextentthatitisnolongerreasonablycertainthatsufficientfuture taxable income will be available against which the deferred tax asset can be realized.

Taxondistributedprofitspayableinaccordancewiththeprovisionsofsection115OoftheIncomeTaxAct,1961isin accordance with the Guidance Note on “Accounting for Corporate Dividend Tax” regarded as a tax on distribu-tionofprofitsandisnotconsideredinDeterminationofprofitsfortheyear.

Cash Flow Statement

CashflowsarereportedusingIndirectMethodinaccordancewithAS-3,namely“CashFlowStatement”issuedbyICAIandaspertheClause32oftheListingAgreementwherebynetprofitbeforetaxisadjustedfortheeffectsofthe transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. Thecashflowsfromregularbusinessoperations,investmentactivitiesandfinancingactivitiesareclassifiedunderthecashflow.

111

Note No : 28 Auditors Remuneration

Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in ` Payments to Auditors comprises: As Auditors - Statutory Audit 91,600 88,240 For taxation matters 22,900 22,060 For company law matters - - For management services - - For other services - - Reimbursement of Expenses - -

Note No. : 29 Deferred Tax Liability / (Deferred Tax Asset) (Net)

Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in ` On account of Depreciation and Amortisation (3,36,033) (5,80,734)

Deferred Tax provision represents, net of provisions for Hardware Sales & Service and EOU (Software Develop-ment Services). Depreciation for EOU division for tax holiday period u/sec 10A is permanent nature, hence not considered for deferred tax provision. Note No : 30 related Party disclosures

S.No. Name of the related Party Nature of relationship

1 V.A. Rama Raju Key Managerial Personnel2 V.Rajam Raju Key Managerial Personnel3 V.Parvathi Relative of Director 4 RelianceTeaPvtLtd CompanyoverwhichDirectorshave

significantinfluence 5 Gavireddy Siva Key Managerial Personnel6 Gottumukkala Achyuta Rama Raju Relative of Director 7 Bangarraju Mudundi Relative of Director 8 V Sarada Relative of Director 9 M Krishna Veni Relative of Director 10 Vegesna Pushpavathi Relative of Director 11 Mohan Raju Indukuri Relative of Director 12 Uma Vani Indukuri Relative of Director 13 Rohit Tiberwal Key Managerial Personnel14 Shilpa Kotagiri Key Managerial Personnel

112

Tran

sact

ions

with

rel

ated

Par

ties:

S.

N

atur

e of

Tra

nsac

tion

FY 2

015-

16

FY 2

014-

15

No

KmP

rela

tive

of

Asso

ciat

e To

tal

KmP

rela

tive

of

Asso

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tal

di

rect

or

di

rect

or

1 Di

rect

ors

Rem

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atio

n / S

alar

y 5

0,64

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2

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-

5

2,92

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4

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2

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1,36

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2 Re

nt

-

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1,8

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4 Di

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1,23

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5 Sh

are

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Bal

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113

disclosure in respect of material transactions during the year:

Sl Particulars FY 2015-16 FY 2014-15No

1 directors remuneration / Salary

V.A.Rama Raju 19,80,000 19,80,000 V.Rajam Raju 18,00,000 18,00,000 V.Parvathi 2,28,000 2,28,000 Gavireddy Siva 8,64,000 8,64,000 Shilpa Kotagiri 88,000 2,64,000 Rohit Tiberwal 3,32,420 - 2 rent

RelianceTeaPvtLtd - 1,80,0003 rent deposits

RelianceTeaPvtLtd 15,46,568 20,00,0004 Salary Advances :

V.Parvathi - 30,000 Gavireddy Siva 4,52,069 2,15,614 5 dividend :

V Atchyuta Rama Raju 4,72,205 2,02,852 V Rajam Raju 2,32,100 1,18,050 Gottumukkala Achyuta Rama Raju 1,19,888 59,944 Bangarraju Mudundi 3,600 1,800 Parvathi Vegesna 980 1,740 V Sarada 3,400 1,700 M Krishna Veni 3,360 1,680 Vegesna Pushpavathi 2,800 1,400 Mohan Raju Indukuri 2,140 1,070 Uma Vani Indukuri 2,000 1,000

Note:RelatedPartyrelationshipsasgivenaboveisasidentifiedbytheCompanyandrelieduponbytheAuditors

Note No. 31 Segment reporting

TheCompanyhas identified two reportable segments viz.SoftwareDevelopmentService,HardwareSales&Services.Segmentshavebeenidentifiedandreportedtakingintoaccountnatureofproductsandservices.Theaccounting policies adopted for segment reporting are in line with accounting policy of the company with following additional policies for segment reporting. a) Revenueandexpenseshavebeenidentifiedtoasegmentonthebasisofrelationshiptooperatingactivities

of the segment. Revenue and expenses which relate to enterprise as a whole and are not allocable to a segment on reasonable basis have been disclosed as “Unallocable”

b) Segment assets and Segment liabilities represent assets and liabilities in respective segments. Investments, tax related assets and other assets and liabilities that cannot be allocated to a segment on reasonable basis have been disclosed as “Unallocable”.

.

(Amount in `)

114

Parti

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Softw

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31.0

3.20

16

31.0

3.20

15

31.0

3.20

16

31.0

3.20

15

31.0

3.20

16

31.0

3.20

15

reve

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Ex

ports

Exte

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es

1,4

3,01

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5

8,08

,100

-

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1

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01,7

40

58,

08,1

00

In

ter S

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ales

-

-

-

-

-

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dom

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Ex

tern

al S

ales

-

-

4

4,43

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003

4

7,94

,82,

080

4

4,43

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003

4

7,94

,82,

080

In

ter S

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-

-

-

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-

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Tota

l Rev

enue

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115

Note No. : 32 Earnings Per Share

Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in f

NetProfitaftertaxasperStatementofProfitand LossattributabletoEquityShareholders(INR) 25,11,049 50,18,927 No of Equity shares 97,58,000 82,38,000 Weighted No of Equity shares 92,34,603 76,13,342 Basic Earnings per share (INR) 0.27 0.66 Diluted Earnings per share (INR) 0.27 0.66 Face value per share (INR) 10.00 10.00 The Calculation of Earnings Per Share (EPS) as disclosed intheProfitandLossAccounthasbeenmadeinaccordance with Accounting Standard (AS - 20) on Earnings Per Share issued by the Institute of Chartered Accountants of India.

Note No. : 33 Earnings in foreign currency


From Engineering Services 1,43,01,740 91,30,338 From Software Development - -

Total Earnings from Foreign Currency 1,43,01,740 91,30,338 Note No. : 34 Expenditure in foreign currency

Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in ` For Foreign Travel - - for Commission on Sales & Reimbursement of Expenses 37,14,075 9,82,478 Purchase Import 7,60,41,544 9,46,89,647 Bank Charges 80,455 49,825 7,98,36,074 9,57,21,950

Note No. : 35 Tax Expense


The Tax Expenses for the year comprises of; Income Tax 19,07,340 54,39,810

Current Year 19,07,340 54,39,810 Less:MATCredit - -

Deferred Tax (3,36,033) (5,80,734)

116

Note No. : 36 Obligations towards operating leases The company has entered into operating lease arrangements for its premises at various locations.

Particulars As At 31.03.2016 As At 31.03.2015 Amount in ` Amount in ` Future minimum lease payments not later than one year 24,53,814 23,03,300 laterthanoneyearandnotlaterthanfiveyears 12,57,953 30,66,054 laterthanfiveyears - -

The future minimum lease rental obligation under non-cancellable operating leases in respect of these assets is on account of lock-in period and notice period in some of the lease agreements entered by the company for operatingofoffices:

OnaccountofLock-inPeriod - - On account of Notice Period 6,30,922 5,79,000 Leasepaymentsrecognizedinthe StatementofProfitandLoss(net) 25,50,922 22,19,100 Sublease payments received / receivable recognizedintheStatementofProfitandLoss - -

Note No. : 37 Working Capital Loan / Vehicle Loans: Working Capital Loan from State Bank of India: Cash Credit and Bank Guarantee Limits: rate of Interest: Cash Credit from SBI: Interestattherateof3.75%magrinabovethebaseratewhichispresently9.30% P.A.Presenteffectiverate13.05%P.A. Primary Security: Hypothecation of Stocks & Receivables (present & future) of the Company.

Collateral Security: 1) EM of Flat No. 401, 04th Floor, Plot No. 14 & 16, S No.93, 94 & 95 located at Madhura Nagar, Yousuf guda, Hyderabad-38 belongs to Shri. V. Atchyutha Rama Raju 2)EMofOfficePremisesNo.619,06thFloor,MakerChambers,VPremisesCo-opSocietyLtd.,Plot No.221 of Backbay reclamation, Nariman Point, Mumbai - 400021. belongs to M/s Reliance Tea Private Limited 3) EM of Plot No. 70, Survey No. 06, Situated at Izzathnagar Village, Serilingampally Mandal, Ranga ReddyDistrict,admeasuring450Sq.yardsintheNameofVamaIndustriesLimiited. Personal Guarantee of 1.ShriV.AtchyutaRamaRaju,MD,S/o.LateV.VenkataSatynarayanaRaju 2.ShriV.RajamRaju,Director,S/o.LateV.VenkataSatynarayanaraju 3. Smt. V. Parvathi, Guarantor, W/o. Sri V. Atchyuta Rama Raju CorporateGuaranteeofM/sRelianceTeaPrivateLimited.

Terms of repayment: WorkingCapitalLoansrepayableondemand.

117

Vehicle Loans from Banks: Rate of Interest: SBICarLoan-HondaCity_1:@9.75%perannum SBICarLoan-HondaCity_2:@9.75%perannum SBICarLoan-HondaCity_3:@9.90%perannum Security: Vehiclesloansaresecuredbyhypothecationofvehiclesfinancedbyrespectivebanks. Terms of repayment: SBI CarLoan1: ThisLoanisrepayablein60monthlyinstallmentsofRs.21,095/-eachcommencingfromMarch,2015 Status as on 31.03.2016 : Balance No. of Installments -45

SBICarLoan2: ThisLoanisrepayablein84monthlyinstallmentsofRs.18,670/-eachcommencingfromMarch,2015 Status as on 31.03.2016 : Balance No. of Installments -69

SBICarLoan3: ThisLoanisrepayablein84monthlyinstallmentsofRs.16,634/-eachcommencingfromSeptember,2015 Status as on 31.03.2016 : Balance No. of Installments -77

unsecured Business Loans from Financial Institutions: Tata Capital Financial Services Limited RateofInterest:@19.02%perannum Security:UnsecuredLoan Terms of Repayment : ThisLoanisrepayablein24monthlyinstallmentsofRs.1,25,415/- each commencing from February, 2016 Status as on 31.03.2016 : Balance No. of Installments -22 religare Finvest Limited RateofInterest:@19.02%perannum Security:UnsecuredLoan Terms of Repayment : ThisLoanisrepayablein36monthlyinstallmentsofRs.1,46,665/- each commencing from March, 2016 Status as on 31.03.2016 : Balance No. of Installments -35 magma Fincorp Limited RateofInterest:@19.00%perannum Security:UnsecuredLoan Terms of Repayment : ThisLoanisrepayablein24monthlyinstallmentsofRs.1,77,340/- each commencing from March, 2016 Status as on 31.03.2016 : Balance No. of Installments -23 Edelwesiss retail Finance Limited RateofInterest:@19.00%perannum

118

As per my audit report of even dateFor G.V &Co.,Chartered AccountantsSd/-Grandhi VittalProprietorMembership No. 206462Firm Regn No. 012875S




Security:UnsecuredLoan Terms of Repayment : ThisLoanisrepayablein36monthlyinstallmentsofRs.91,641/- each commencing from March, 2016 Status as on 31.03.2016 : Balance No. of Installments -35 Bajaj Finserv Limited RateofInterest:@19.00%perannum Security:UnsecuredLoan Terms of Repayment : ThisLoanisrepayablein36monthlyinstallmentsofRs.92,556/- each commencing from March, 2016 Status as on 31.03.2016 : Balance No. of Installments -35

Note No. : 38 Contingent Liabilities

The liability towards bank guarantees of Rs. 2,60,62,433/- issued to various parities by the company in the course ofordinarybusinessispartlycoveredagainstfixeddepositswiththebankswhichareheldbythebankersasthesecurity. 39 Note: Capital Commitments Estimated amount of unexecuted capital contracts of Rs. 2,42,00,000/- identified by the management

relevant for the current FY 2015-16. There are no other contracts remaining to be executed on capital accountandnotprovidedfor,duringthecurrentfinancialyear.

40 In the opinion of the Board, current assets, loans and advances are stated at a value, which could be

realized in the ordinary course of business. The provision for all known liabilities made is adequate and not in excess of the amount reasonably necessary.

41. Some of the balances in Sundry Debtors, Sundry Creditors, Advances and Deposits are subject to

confirmation,reconciliationsandadjustments, ifany,whichintheopinionofthemanagementwillnotbesignificant.

42. ThesefinancialstatementshavebeenpreparedintheformatprescribedbytheScheduleIIItotheCompanies

Act,2013. 43. Thefiguresofthepreviousyeararere-grouped/re-classifiedwherevernecessarytomakethemcomparable

with that of the current year.

119

VAmA INduSTrIES LImITEdCIN:L72200TG1985PLC041126

RegisteredOffice:Ground Floor, 8-3-191/147/24, Plot No. B-12, Madhura Nagar, S.R. Nagar[Post], Hyderabad 500 038

ATTENdANCE SLIP FOr ANNuAL GENErAL mEETING(to be surrendered at the venue of the meeting)

IcertifythatIamaregisteredshareholder/proxy/representativefortheregisteredshareholder(s)ofVamaIndustriesLimited.

Iherebyrecordmypresenceatthe31stAnnualGeneralMeetingoftheshareholdersofVamaIndustriesLimitedheldonMonday,the 26th Day of September, 2016 at 10.00 A.M. at Hotel Inner Circle, Raj Bhavan Road, Somajiguda, Hyderabad - 500082.

Reg.FolioNo./ClientID*

DPID*

No. of Shares

Name & Address of Member

_________________________________Signature of Shareholder/Proxy/Representative(Please Specify)

121

VAmA INduSTrIES LImITEdCIN:L72200TG1985PLC041126

RegisteredOffice:Ground Floor, 8-3-191/147/24, Plot No. B-12, Madhura Nagar, S.R. Nagar[Post], Hyderabad 500 038

Form No. MGT-11Proxy form

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

CIN : CIN:L72200TG1985PLC041126Name of the company : VAmA INduSTrIES LImITEdRegisteredoffice : Ground Floor, 8-3-191/147/24, Plot No. B-12, Madhura Nagar, Hyderabad-500 038

Name of the member(s) :

Registered Address :

Email Id :

Folio No / Client ID : DP ID :

I /We, being the member(s) of____________ shares of the above named company, hereby appoint

1. Name

Address

E-mail Id Signature

or failing him

2. Name

Address

E-mail Id Signature as my / our proxy to attend and vote (on a poll) for me / us and on my / our behalf at the 31st Annual General Meeting of the company, to be held on Monday, the 26th day of September, 2016 at 10.00 A.M. at Hotel Inner Circle, Raj Bhavan Road, Somajiguda, Hyderabad and at any adjournment thereof in respect of such resolutions as are indicated below :

Resolutions For Against

1. Adoption of Financial Statement for the FY ended 31st March, 2016.

2. Declaration of Dividend.

3.Re-appointmentofSmt.R.RamaSravanthitotheofficeofDirectoroftheCompany.

4.RatificationofappointmentofM/sG.V.&Co,CharteredAccountantsasAuditors.

5. To approve the split of nominal value of the equity share of Rs 10/- per share to Rs 2/- per share.

6. To approve the amendment of the clause V of the Memorandum of Association of the Company.

Signed this …………. day of ………………. 2016.

Signature of shareholder : _________Signature of Proxy holder(s) : __________

Note:ThisformofproxyinordertobeeffectiveshouldbedulycompletedanddepositedattheRegisteredOfficeoftheCompany,not less than 48 hours before the commencement of the Meeting..

123

VAmA INduSTrIES LImITEdCIN: L72200TG1985PLC041126

Regd. Off. Ground Floor, B-12, Madhura Nagar, Hyderabad - 500038Phone: +91 40 6661 5534 / 6661 9919, Fax: 040-23708672

e-mail: [email protected]; website: www.vamaind.com

BALLOT FOrm

1. Adoption of Financial Statement for the FY ended 31st March, 2016.

2. Declaration of Dividend

3. Re-appointment of Smt. R. Rama Sravanthi to the officeofDirectoroftheCompany.

4. RatificationofappointmentofM/sG.V.&Co, Chartered Accountants as Auditors

5. To approve the split of nominal value of the equity share of Rs 10/- per share to Rs 2/- per share.

6. To approve the amendment of the clause V of the Memorandum of Association of the Company.

Place:_________________

Date:__________________

Description

No. of Shares

(For) I/We assent

to the Resolution

(Against) I/We dissent

to the Resolution

Signature of Shareholder

Serial No. :

Note: Please read the instructions carefully before exercising your vote.

(1) Name and Registered Address : of the Sole / First named Shareholder (2) Name(s) of the Joint Holder(s) : (Ifany)

(3) Registered Folio No./ : DPID No. and Client ID No.

(4) Number of Share(s) held :

I/we hereby exercise my/our vote in respect of resolution(s) set out in Notice of Thirty First Annual General Meeting (AGM) to be held on Monday, 26th September 2016 by recording my/our assent or dissent to the saidresolutionsbyplacingthe(√)intheappropriateboxbelow:

S. No. Particulars details

ItemNo.

124

rOuTE mAP FOr VENuE OF AGm

Annual Report 2015-16 VAMA INDUSTRIES LIMITED. Atchyuta Rama Raju ... Vani Nagar Malkajgiri,...

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