The Board of Directors has pleasure in presenting herewith their 18^th Annual Report together with the Audited Financial Statements of your Company for the year ended 31^st March, 2018.

FINANCIAL RESULTS:

The Company's financial performance for the year under review along with previous year's figures is given hereunder:

(Amount in Rs.)

REVIEW OF OPERATIONS AND DIVIDEND

The Company generated revenue of Rs. 50,67,70,559/- during the current year as against revenue of Rs. 40,91,15,345/- generated in the preceding year. The operations of the Company have resulted into post tax profit of Rs. 3,00,59,191/- against post tax profit of Rs. 68,44,090/- in the preceding year. Owing to the growing business needs and the necessity to plough back the profits in the business, your Directors do not recommend any dividend for the year.

TRANSFER TO RESERVES

Your Company does not propose to transfer amounts to the General Reserve considering the availability of profits during the year under review.

ANNUAL RETURN

The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014, is furnished in "Annexure-I" and is attached to this Report.

NUMBER OF MEETINGS OF THE BOARD

The Board of Directors met 5 times during the year under review on 30^th May, 2017, 17^th August, 2017, 29^th September 2017, 13^th November 2017 and 05^th March 2018 respectively. Notice of meetings with agenda along with necessary details was sent to the Directors in time.

Further following are the details with respect to Board meeting attendance by each Director.

# Mr. Gurnamsing Bhatiyani vacated his office from 17^th February, 2018.

*Mr. Karan Yadav resigned from 15^th November, 2017; and

**Mr. Tanaji Yadav and Mr. Avinash Salunkhe were appointed w.e.f. 13^th November, 2017.

COMMITTEES OF THE BOARD:

i. Audit Committee Composition of Audit Committee:

The Audit Committee was reconstituted by the Board of Directors in a meeting held on November 13, 2017. The Committee comprises of the following members:

ii. Nomination and Remuneration Committee

Composition of Nomination and Remuneration Committee:

The Nomination and Remuneration Committee was reconstituted by the Board of Directors in a meeting held on November 13, 2017.The Committee comprises of the following members:

iii. Stakeholders Relationship Committee

Composition of Stakeholders Relationship Committee:

The Stakeholders Relationship Committee was reconstituted by the Board of Directors in a meeting held on November 13, 2017. The Committee comprises of the following members:

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mrs. Jagjitkaur Sethi, Director of the Company, retires by rotation and being eligible has offered herself for re-appointment.

The Company had appointed Mr. Avinash Salunkhe, Mr. Tanaji Yadav as Additional Directors of the Company in a Board Meeting held on 13^th November 2017 and Mr. Karan Yadav was appointed as an Additional Director of the Company in a board meeting held on 16^th August, 2018 pursuant to Section 161 of the Companies Act, 2013 (the Act) and they can hold the office till the conclusion of this Annual General Meeting (AGM). The Company has received notice under Section 160 of the Act in writing from the member signifying his intention to be proposed them as a candidate for Directorship.

All Independent Directors have given declarations that they meet the criteria of Independence as laid down under Section 149(6) of the Act.

Mrs. Sheetal Jagetiya resigned from the post of Company Secretary and Compliance Officer w.e.f. 24^th September, 2017 and in her place Mr. Chetan Kumbhojkar was appointed as Company Secretary and Compliance Officer of the Company w.e.f. 29^th September, 2017.

Mr. Gurnamsing Bhatiyani vacated his position from the directorship of the Company w.e.f. 17^th February, 2018.

NOMINATION AND REMUNERATION POLICY

The Nomination and Remuneration Policy is designed to attract, motivate, improve productivity and retain manpower, by creating a congenial work environment, encouraging initiatives, personal growth and team work, and inculcating a sense of belonging and involvement, besides offering appropriate remuneration packages and superannuation benefits. The policy reflects the Company's objectives for good corporate governance as well as sustained long term value creation for shareholders.

DIRECTORS' RESPONSIBILITY STATEMENT

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

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

(b) 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 Company at the end of the financial year and of the profit & loss of the Company for that period;

(c) the Directors have taken proper and sufficient care for the 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 fraud and other irregularities;

(d) the Directors have prepared the annual accounts on a going concern basis;

(e) the Directors have laid down proper internal financial controls and system which are adequate and are operating effectively.

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

AUDITORS & THEIR REPORTS

STATUTORY AUDITORS

M/s. Natesh & Associates, Chartered Accountants, Nashik, were appointed as Statutory Auditors of the Company at the Annual General Meeting of the Company held on 26^th September 2014 to hold office till the conclusion of 19^th Annual General Meeting subject to ratification by shareholders at every Annual General Meeting.

The Statutory Auditors' Report does not contain any qualification, reservation or adverse remark.

SECRETARIAL AUDITORS

The Board of Directors had appointed M/s. Prajot Tungare & Associates, Practicing Company Secretaries as the Secretarial Auditors of your Company to issue a Secretarial Audit Report pursuant to Section 204 of the Companies Act, 2013 for the financial year 2017-18.

Accordingly, the Secretarial Auditors have given their report, which is annexed hereto as "Annexure II".

Auditor comments/ observation:

i. Scrutinizer Report was not submitted within 48 hours from the conclusion of annual general meeting

ii. Financial results for Quarter ended 30.09.2017 was not submitted within 30 minutes.

iii. Brief profile of Directors/ KMP was not submitted with the intimation letter.

Management Reply-

i. Last Annual General Meeting of the Company was held on Friday, 29^th September, 2017 and next two days being festival and weekly off for the RTA of the Company, the data required for filing voting results to Exchange was not available. Results were intimated to Exchange on immediate next working day.

ii. Due to technical difficulties there was delay in filing financial results to Exchange.

iii. The Company has submitted its reply on the clarifications sought on the profile of Directors and KMP appointed in the Company.

COST AUDITORS

The Company is required to have the audit of its cost records conducted by a Cost Accountant in Practice. In this connection, the Audit Committee has recommended to the Board of Directors and the Board of Directors has approved the appointment of M/s. A. J. Paranjape & Co., Cost Accountants, as Cost Auditors of the Company to conduct the Cost Audit Functions for the financial year 2018-19.

As required under the provisions of Companies Act, 2013, a resolution seeking members approval for the remuneration payable to the Cost Auditors forms part of the Notice convening the Annual General Meeting of the Company.

SHARE CAPITAL

The paid up share capital of the Company as on 31^st March, 2018 was Rs. 8.20 Crores. During the year under review the Company has not issued any types shares.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

There were no loans, guarantees or investments made by the Company as referred under the under the provisions of the section 186 of the Companies Act, 2013 during the year, and hence the said provision are not applicable to the Company.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

The transactions entered by the Company with related parties were in ordinary course of business and at arm's length basis. The particulars of transactions entered with related parties are annexed herewith as "Annexure III" to this report.

MATERIAL CHANGES AND COMMITMENT

No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which financial statements relate and on the date of this report.

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

The Particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act, are provided in "Annexure IV" to this report.

DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY

The Company has a robust risk management framework comprising risk governance structure and defined risk management processes. The Company identifies all strategic, operational and financial risks that the Company faces, by assessing and analyzing the latest trends in risk information available internally and externally and uses the same to plan for risk mitigation activities.

INTERNAL FINANCIAL CONTROLS

The Company has adopted adequate procedures for ensuring the internal financial controls. The Company adheres to best practices for safeguarding its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and timely preparation of reliable and accurate financial information.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVE

The provisions of Section 135 of the Companies Act, 2013, are not applicable to the Company hence Company has not developed and implemented any Corporate Social Responsibility initiatives.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES AND THEIR POSITION & FINANCIAL PERFORMANCE

The Company does not have any Subsidiary, Joint venture or Associate Company.

DEPOSITS

Your Company has not accepted any deposits within the meaning as provided in the Companies Act, 2013.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the courts / regulators or tribunals impacting the going concern status and companies operations in future.

MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT

Management's Discussion and Analysis Report for the year under review, as stipulated under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") is presented in "Annexure V" to this report.

PERFORMANCE EVALUATION

The Company has devised a Policy for performance evaluation of the Board, Committees and other individual Directors (including Independent Directors) which includes criteria for performance evaluation of the Non-executive Directors and Executive Directors. The evaluation process inter alia considers attendance of Directors at Board and committee meetings, acquaintance with business, communicating inter se board members, effective participation, domain knowledge, compliance with code of conduct, vision and strategy, benchmarks established by global peers, etc., which is in compliance with applicable laws, regulations and guidelines.

The Board carried out annual performance evaluation of the Board, Board Committees and Individual Directors and Chairperson. The Chairman of the respective Board Committees shared the report on evaluation with the respective Committee members. The performance of each Committee was evaluated by the Board, based on report on evaluation received from respective Board Committees.

PARTICULARS OF EMPLOYEES

Disclosure as per Section 197 (12) of the Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith as "Annexure- VI" to this report.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMAN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

In this regard, Internal Complaints Committee has been set up to redress complaints. During the year under review, there were no complaints received pursuant to the aforesaid Act.

ACKNOWLEDGEMENTS

Your Directors place on record their sincere thanks to bankers, business associates, consultants, and various Government Authorities for their continued support extended to your Companies activities during the year under review. Your Directors also acknowledges gratefully the shareholders for their support and confidence reposed on your Company.

For and on behalf of The Board of Directors

Aurangabad Distillery Limited

Amardeepsingh Sethi

Chairman & Whole time Director

DIN: 00097644

Date: 16^th August, 2018

Place: Pune