BOARD'S REPORT

Dear Shareholders,

The Directors have the pleasure of presenting their Thirtieth Annual Report on the business and operations of the Company on standalone basis and the accounts for the financial year ended March 31, 2018.

FINANCIAL RESULTS: (Rs, In Lakhs)

Pursuant to the notification dated 16th February, 2015 issued by the Ministry of Corporate Affairs, the Company has adopted the Indian Accounting Standards ("Ind AS") notified under the Companies (Indian Accounting Standards) Rules, 2015 with effect from 1st April, 2017.

REVIEW OF PERFORMANCE

During the Financial year 2017-18, your company's performance has been fairly good, amidst a volatile and competitive market environment caused due to De-monetisation and GST implementation. On the standalone basis, your company recorded total sales of Rs. 64965.32 Lakhs in the FY 2017-18, as compared to Rs. 70402.39 Lakhs in the previous year, reflecting a decline of 7.72%. The decline in the sales is due to change in the accounting of Indirect Taxes. In previous year sales includes indirect Taxes, whereas from 1st July 2017 GST is not part of sales turnover. Total export turnover of the company stood at Rs.40999.17 Lakhs in the FY 2017-18. The profit after tax for the financial year 2017-18 is Rs. 1171.17 Lakhs as compared to Rs. 904.94 Lakhs during the previous year, recording a growth of 29.42%,which is really commendable.{Kindly note that the figures have been regrouped in accordance with the Indian Accounting Standards (hereinafer referred to as the "Ind AS").This financial statement for FY 2017-18 are the first financials with comparatives, prepared under Ind AS.}

EXPANSION:

During the year under review, your Company has incurred capital expenditure of Rs.4542.50 Lakhs towards increasing productivity in weaving and processing activities, which was financed by way of internal accruals of the Company.

DIVIDEND

The Board of Directors is pleased to recommend a Dividend of 30% (i.e. @ Rs. 3/- per Equity Share) for the Financial Year (FY) 2017-18, subject to the approval of the Members. Dividend for the previous FY 2016-17 was declared @ 28% (i.e. @ Rs. 2.80/- per Equity Share). The Dividend for FY 2017-18 shall be paid to those Shareholders and Beneficial Owners whose names appear in the Register of Members as on the date of the Book Closure for dividend payment.

TRANSFER TO RESERVES

The Company proposes to transfer Rs. 200.00 Lakhs to the General Reserve out of the amount available for appropriations and an amount of Rs. 5848.68 Lakhs is proposed to be retained in the Profit and Loss Account.

RESERVE AND SURPLUS

Reserves and Surplus stood at to Rs. 9439.61 Lakhs as at March 31, 2018 compared to Rs. 8727.68 Lakhs as at March 31, 2017. The increase was due to retained earnings.

BOARD MEETINGS

The Board of Directors duly met 6 times during the financial year from April 1, 2017 to March 31, 2018. The dates on which the meetings were held are as follows:

May 29, 2017, August 11, 2017, November 11, 2017, January 23, 2018, February 14, 2018 and March 29,2018.

POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION

The current policy is to have an appropriate mix of executive and independent directors. On March 31, 2018 the Board consists of seven members, three of whom are executive directors or whole Time Director and four are independent directors.

The policy of the Company on directors' appointment and remuneration including criteria for determining qualification, positive attributes independence of director and other matters as required under sub- section (3) of Section 178 of the Companies Act,2013 is available on our website www.damodargroup.com. There has been no change in the policy since the last fiscal year. We affirm that remuneration paid to directors is as per the terms laid out in the nomination and remuneration policy of the company.

DECLARATION BY INDEPENDENT DIRECTOR(S)

The Board of Directors hereby certify that the Independent Directors appointed on the Board, meet the criteria pursuant to Section 149(6) of the Companies Act, 2013.

Further, The Company has received necessary declaration from each independent director under section 149 (7) of the Companies Act, 2013, that he/she meet the criteria of independence laid down in Section 149 (6) of the Companies Act,2013 and Regulation 25 of SEBI (Listing Obligations and Disclosure requirements) Regulations, 2015.

BOARD EVALUATION

The Board of Directors has carried out an annual evaluation of its own performance, Board committees and individual directors pursuant to the provisions of the Act. The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of the criteria such as the Board composition and structure, effectiveness of board processes, information and functioning, etc. The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

All new independent directors inducted into the Board attend an orientation programme. The Details of training and familiarization programme are provided in the Corporate Governance Report and also available on our website www.damodargroup.com.

CODE OF CONDUCT FOR THE PREVENTION OF INSIDER TRADING

The Board of Directors has adopted the Insider Trading Policy in accordance with the requirement of the SEBI (Prohibition of Insider Trading) Regulations, 2015 and the Insider Trading Policy of the Company covering code of practices and procedures for fair disclosure of unpublished price sensitive information and code of conduct for prevention of insider trading is available on our website www.damodargroup.com.

CHANGE IN NATURE OF BUSINESS, IF ANY

During the year, there was no change in the nature of business of the Company.

DIRECTORS AND KEY MANAGERIAL PERSONNEL APPOINTMENT

Mr. Anil D. Biyani - Retiring Director:

As per the provisions of Companies Act,2013 Mr. Anil D. Biyani shall retire by rotation at the forthcoming Annual General Meeting of the Company and being eligible, offers himself for re-appointment. The Board is pleased to recommend his re-appointment.

DIRECTOR'S RESPONSIBILITY STATEMENT

In terms of Section 134(3) of the Companies Act, 2013, the Directors would like to state:

(a) that in the preparation of the annual financial statements for the year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

(b) that such accounting policies as mentioned in the Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of the profit of the Company for the year ended on that date;

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

(d) that the annual financial statements have been prepared on a going concern basis;

(e) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

(f) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

COMMITTEE OF THE BOARD

The Board has five committees, the Audit Committee, the Nomination and Remuneration Committee, the Stake holders Relationship Committee, the Corporate Social Responsibility Committee, the Risk Management Committee. The detailed note on the composition of the Board and its committees is provided in the Corporate Governance report section of this Annual Report.

STATUTORY AUDITORS AND AUDITOR'S REPORT

In accordance with Section 139 of the Companies Act, 2013, M/s. Jitendra Mishra & Company, Chartered Accountants (FRN No. 125334W), were appointed by the shareholders of the Company at the 27th Annual General Meeting held on August 7, 2015, as Statutory Auditors for a period of 5 years to hold office until the conclusion of the 32nd Annual General Meeting of the Company in calendar year 2020.

In accordance with the provisions of Section 139, 142 and other applicable provisions of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014, the appointment of the Statutory Auditor is required to be ratified by the shareholders at every Annual General Meeting during their tenure.

M/s. Jitendra Mishra & Company, Chartered Accountants (FRN No. 125334W) , have confirmed that they are eligible for having their appointment as Statutory Auditors ratified at this Annual General Meeting (AGM). Accordingly, approval of shareholders is being sought at this AGM for ratification of their appointment.

The Auditors Report does not contain any qualification, reservation or adverse remark on the financial statements for the year ended March 31, 2018.

SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act 2013, and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Company has appointed M/s. Pramod Jain & Co., Practicing Company Secretaries, as its Secretarial Auditor to undertake the Secretarial Audit for the financial year 2018-19.

The Secretarial Audit Report of M/s. Pramod Jain & Co., Practicing Company Secretaries for the financial year ended March 31,2018 is annexed as Annexure-A.

The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

COST AUDIT

M/s. Dilip M. Bathija, Cost Accountants (FRN No.100106) have been duly appointed as Cost Auditors for conducting Cost Audit in respect of products manufactured by the Company which are covered under the Cost Audit Rules for current financial year ending March 31, 2019. They were also the Cost Auditors for the previous year ended March 31, 2018. As required by Section 148 of the Companies Act, 2013, necessary resolution has been included in the Notice convening the Annual General Meeting, seeking ratification by the Members to the remuneration proposed to be paid to the Cost Auditors for the financial year ending March 31, 2019.

INTERNAL AUDITOR

As per requirements of Section 138(1) of the Companies Act, 2013 read with rule 13 of the Companies (Accounts) Rules, 2014, the Board of Directors of the Company had appointed M/s. Pokharna Somani & Associates, Chartered Accountants as Internal Auditor of the Company to conduct Internal Audit of business processes, financial reporting controls, compliance with applicable laws, regulations etc for the year 2017-18.

FIXED DEPOSITS

Details relating to Fixed Deposits, covered under Chapter V of the Companies Act,2013, as under:

a. Accepted during the year : Rs. 31,33,68,000/-/-

b. Remained unpaid or unclaimed as at the end of the year : 0.00

c. Whether there has been any default in repayment of deposits

or payment of interest thereon during the year : Nil

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provisions of Section 124 and 125 of the Companies Act, 2013, relevant amounts which remained unpaid or unclaimed for a period of seven years have been transferred by the Company, from to time to time on due dates, to the Investor Education and Protection Fund.

Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on August 11, 2017 (date of last Annual General Meeting) on the Company's website (www.damodargroup.com), as also on the Ministry of Corporate Affairs' website.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

CORPORATE GOVERNANCE

The Company has adopted the best possible Corporate Governance norms and it has been our endeavor to comply and upgrade to the changing norms.

A separate section on corporate governance and a certificate from the Practicing Company Secretary regarding compliance of conditions of Corporate Governance as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

As per Regulations 17 (8) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,2015, a Certificate of the Managing Director inter alia, confirming the correctness of the financial statements, adequacy of the internal control measures and reporting to matters to the Audit Committee in terms of the said Clause, is also enclosed as a part of this Report.

RISK MANAGEMENT

At present there is no identifiable risk which, in the opinion, of the board may threaten the existence of the Company.

MANAGEMENT DISCUSSION AND ANALYSIS

As required under Regulation 34(2) (e) of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations,2015 the Management Discussion and Analysis Report is presented in a separate section forming part of the Annual Report.

VIGIL MECHANISM POLICY FOR THE DIRECTORS AND EMPLOYEES

The Company has established a vigil mechanism for directors and employees to report genuine concerns. The vigil mechanism provides for adequate safeguards against victimization of person who use vigil mechanism and also provide direct access to Chairman of the Audit Committee and Managing Director of the Company in appropriate and exceptional cases.

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.damodargroup.com

DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION & REDRESSAL) ACT, 2013

Your Company is committed to provide a work environment which ensures that every woman employee is treated with dignity, respect and equality. There is zero- tolerance towards sexual harassment and any act of sexual harassment invites serious disciplinary action.

The Company has established a policy as per under Section 22 of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 against Sexual Harassment for its employees. The policy allows any employee to freely report any such act and prompt action will be taken thereon. The Policy lays down severe punishment for any such act. Further, your Directors state that during the year under review, there were no cases of sexual harassment reported to the Company.

MATERIAL CHANGES FROM END OF FINANCIAL YEAR TILL DATE OF REPORT

There are no material changes and commitments, affecting the financial position of the Company which has occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report other than those disclosed in the financial statements.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUTGO

The information required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules,2014, is given in the Annexure-B to this report.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-C.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Corporate Social Responsibility is the Company's intent to make a positive difference to the society. As per Companies Act, 2013 which requires Companies contribute some part of its profits towards the CSR activities. We have adopted Corporate Social Responsibility as a strategic tool for sustainable growth. With the CSR Vision, Build a powerful partnership Society for Sustainable Development and to improve the quality of life of the communities we serve through long tern stakeholders' value creation. We are committed to operate our business with emphasis on CSR in all areas of our operation. The Corporate Social Responsibility Policy enumerating the CSR activities to be undertaken by the Company, in accordance with Schedule VII to the Companies Act,2013 was recommended to the Board and the Board adopted the same.

The Company's spend on the CSR activities has been less than the limits prescribed under the Companies Act 2013. This is because the company did not find any further suitable projects or programs during the year to spend, for achieving the prescribed limit as per the Companies Act,2013. However the CSR activities are scalable which coupled with new initiatives that may be considered in future , moving forward the Company will endeavor to spend on CSR activities in accordance with the prescribed limits.

The said policy is also available on the website www.damodargroup.com. The Annual Report under CSR activities is annexed to the report as Annexure D.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

The prescribed particulars of Employee required under section 197 read with Rule 5 of the Companies (Appointment and remuneration of Managerial Personnel) Rules, 2014 is attached as Annexure-E as form the part of Boards Report.

PARTICULAR OF CONTRACTS OR ARRANGEMENT WITH RELATED PARTIES

The Company has formulated a policy on dealing with Related Party Transaction. The said policy is available on the Company's website www.damodargroup.com

Pursuant to the provisions of Regulation 23 of Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, prior approval of Audit Committee was sought for entering into related party transactions. During the year the Company had entered into related party transaction with family members of executive directors of the company as per Listing Regulations. The Company had taken the approval from the shareholders at Annual General Meeting held on August 11, 2017 for entering into related party transaction as per listing regulations and the particulars contracts entered during the year as per form AOC-2 is enclosed as Annexure-F.

DISCLOSURE OF POLICIES

The SEBI (Listing Obligations and Disclosure Requirements) Regulations,2015 mandated the formulation of certain policies for all listed Companies. All our Corporate Governance policies are available on our website www.damodargroup.com. All our corporate policies are reviewed periodically by the Board and undated based on need and new compliance requirement.

In addition to its Code of Conduct and Ethics, key policies that have adopted by the Company are as follows:

- NOMINATION, REMUNERATION AND EVALUATION POLICY: The policy formulates the criteria for determining qualification competencies, positive attributes and independence of a director and also criteria for determining the remuneration of the directors' key managerial personnel and other employees. The said policies is attached as Annexure-G as form t

the part of Boards Report.

- RELATED PARTY TRANSACTION POLICY: The Policy regulated all transaction between the Company and its related party in terms of Section 188 of the Companies Act, 2013

- CORPORATE SOCIAL RESPONSIBILITY: The Policy outlines the Company strategy to bring about a positive impact on society through programme relating to hunger, education healthcare and environment.

- POLICY ON MATERIAL SUBSIDIARIES: The policy used to determine the material subsidiaries and material non-listed Indian subsidiaries of the Company.

- WHISTLE BLOWER POLICY: The Company adopted the whistle blower mechanism for director and employee to report concerns about unethical behavior, actual or suspended fraud, violation of Company rules of other matters or activity on account of which the interest of the company affected.

- INSIDER TRADING POLICY: The policy provides the framework in dealing with securities of the Company. INTERNAL CONTROL SYSTEM AND AUDIT

In terms of Section 134 of the Companies Act 2013 and provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Auditors report to the Chairman of the Audit Committee of the Board.

The Internal Auditors monitor and evaluate the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee on a regular basis.

GENERAL DISCLOSURES

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

(A) ISSUE OF SHARE WITH DIFFERENTIAL RIGHTS

The Company has not issued any shares with differential rights and hence no disclosure is required as per provisions of Section 43(a)(ii) of the Act read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014.

(B) ISSUE OF SWEAT EQUITY SHARES

The Company has not issued any sweat equity shares during the year under review and hence no disclosure is required as per provisions of Section 54(1)(d) of the Act read with Rule 8(13) of the Companies (Share Capital and Debenture) Rules, 2014.

(C) ISSUE OF EQUITY SHARES UNDER EMPLOYEE STOCK OPTION SCHEME

The Company has not issued any equity shares under Employees Stock Option Scheme during the year under review and hence no disclosure is required as per provisions of Section 62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debenture) Rules, 2014.

APPRECIATION

Your Directors take this opportunity to place on record their warm appreciation for the invaluable contribution and spirit of dedication shown by the employees at all levels during FY 2017-18. The Directors also express their deep For and on behalf of the Board gratitude for the business assistance, co-operation and support extended to your Company by its Customers, Distributors, Dealers, Suppliers, Service Providers, Bankers, various Government Organizations / Agencies & Shareholders and look forward to their continued support and co-operation in future

For and on behalf of the Board

Sd/-

Arunkumar Biyani

Place: Mumbai Executive Chairman

Date : May 26,2018 (DIN:00016519)