The Members,

The Directors have pleasure in presenting their 34th Annual Report on the business and operations of the Company and the accounts for the Financial Year ended March 31, 2018.

FINANCIAL SUMMARY OR HIGHLIGHTS/PERFORMANCE OF THE COMPANY

(Rs. in Lakhs)

DIVIDEND

To strengthen the cash flow of the Company, the Directors decided not to declare any dividend in the year.

RESERVES

As on March 31 , 201 8 the reserves and surplus has increased to Rs. 1489.98 lakhs as compared to Rs. 1238.82 lakhs achieved during the last year.

COMPANY’S WORKING DURING THE YEAR

The company earned total income of Rs. 6789.12 lakhs as compared to Rs. 6406.98 earned in the previous year showing increase of 5.63%. The operations during the year have resulted in a profit of Rs. 252.91 lakhs.

MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

During the year there are no material changes and commitments, if any, affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report.

SIGNIFICANT AND MATERIAL ORDERS

There have been no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and the Company’s operations in future.

ADOPTION OF INDIAN ACCOUTING STANDARD (IND AS)

Your Company has adopted Indian Accounting Standards (“Ind AS”) pursuant to Ministry of Corporate Affairs Notification dated 16th February 2015 notifying the Companies (Indian Accounting Standard) Rules, 2015. Accordingly, for the first time the financial statements for the year under report have been prepared in compliance with Ind AS.

You may refer Note 41 of Standalone Financial Statement forming part of the Annual Report for an explanation of how the transition from previous GAAP to Ind AS has affected financial position, performance and cash flow of the Company.

SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES

The Company has no subsidiary or joint venture or associate company.

INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Statutory Auditors of the Company in the ‘Annexure B’ to the Audit Report, have formed a disclaimer of opinion about the internal Financial Control over financial reporting and its efficiency. in the light of the said disclaimer of opinion, we would like to state as under:

The Company has an internal Control System, commensurate with the size, scale and complexity of its operations. The Company has an internal Auditor who reports on all internal audit functions as to maintain, monitor and evaluate the efficiency and adequacy of internal control system in the Company. Based on the report of the internal auditor; the management undertakes corrective actions; as and when required; in their respective areas to strengthen the internal financial control.

AUDIT OBSERVATIONS AND EXPLANATION BY THE BOARD

The Statutory Auditors of the Company in their Audit Report for the financial year ended 31st March 2018 have qualified their opinion to the extent of the matter described in the basis for qualified opinion paragraph in the said audit report with regard to overdue trade receivables as on 31st March 2018. The basis for qualified opinion as stated by the Statutory Auditors in their above referred Audit Report is appended herein below:

Basis for Qualified opinion:

“The confirmations related to overdue trade receivables amounting to Rs. 3.91 crores have not been received by the Company. Accordingly no provision of Rs. 3.91 crores has been made for such receivables in the enclosed financial results. This has resulted in the overstatement of Trade receivables by Rs. 3.91 crores and overstatement of profit by Rs. 3.91 crores.”

In the light of the said basis for qualified opinion, the management would like to state as under:

The trade receivables outstanding as on 31st March 2018 are good and recoverable. The necessary letters for balance confirmation have already been forwarded by the Company to the respective debtors and the said balances are neither disputed nor denied by them. in view of the same the Management has reason to believe that the trade receivables outstanding as on 31st March 2018 as per the books of accounts of the Company are true, correct and recoverable.

From the outstanding trade receivables as on 31st March 2018; an amount of Rs. 1.12 crores have already been realized in the normal course of business till the date of this report.

REPORTING OF FRAUDS BY AUDITORS

During the year under review, neither the statutory auditors nor the secretarial auditor has reported to the audit committee, under Section 143 (12) of the Companies Act, 2013, any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in the Board’s Report.

DEPOSITS

The details relating to deposits, covered under Chapter V of the Act,-

a) accepted during the year; : 10.00 Lakhs

b) remained unpaid or unclaimed as at the end of the year; Nil

c) whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved;

(i) at the beginning of the year - Nil

(ii) maximum during the year - Nil

(iii) at the end of the year - Nil

The details of deposits which are not in compliance with the requirements of Chapter v of the Act Nil

AUDITORS

Statutory Auditor:

M/S. B. D. Jokhakar & Co., Chartered Accountants, Mumbai, (FRN: 104345W), who were appointed as the Statutory Auditors of the Company at its 33rd Annual General Meeting have tendered their resignation vide letter dated 06th August 2018 ; due to their preoccupation in other professional work as stated therein. The said letter was received by the Company on 08th August 201 8. The Board of Directors at their meeting held on 16th August 2018 appointed M/s. Attar & Associates, Chartered Accountants, Thane, Maharshtra (FRN: 116443W) as Statutory Auditors, to fill the casual vacancy caused due to the resignation of M/S. B. D. Jokhakar & Co., from 16th August 2018 to the conclusion of 34th Annual General Meeting, subject to the approval of members.

M/s. Attar & Associates, Chartered Accountants, Thane, Maharashtra, are eligible for appointment and have confirmed that their appointment, if approved, will be in compliance with Section 141 of the Companies Act, 2013 and other applicable provisions.

Your Board recommends the appointment of M/S. Attar & Associates, Chartered Accountants, Thane, Maharashtra, (FRN : 116443W) as Statutory Auditors for a term of 5 financial years commenced from current financial year and to hold office from the conclusion of 34th Annual General Meeting till the conclusion of the 39th Annual General Meeting of the Company.

As per the provisions of the Companies Act, 2013, the Auditors Report on Financial Statements for the year ended 31st March 2018 as issued by the Statutory Auditor M/S B. D. Jokhakar & Co., Chartered Accountants forms part of this Annual Report.

SHARE CAPITAL

During the year the 304000 equity shares of Rs. 10/- each were issued on part conversion of warrants at price of Rs. 17/- per share to promoter and promoter group. So as on 31st March, 2018 the share capital of the Company was Rs. 739.10 lacs. Following two directors are holding shares of the Company:

Mr. Abhishek Patel

Mr. Pranav Patel

EXTRACT OF THE ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as “Annexure A”.

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

The information required to be disclosed is set out in “Annexure B”

DIRECTORS:

A. Changes in Directors and Key Managerial Personnel

There are no changes in the Board of directors of the Company. As on March 31, 2018 the Board of the Company comprises of four directors viz. Mr. Abhishek Patel, Managing Director, one Non-Executive Director and two Independent Directors.

B. Declaration by an Independent Director(s)

All Independent Directors have given declarations that they meet the criteria of Independence as laid down under Section 149(6) of the Companies Act, 2013 read with SEBI (LODR) Regulations, 2015.

C. Formal Annual Evaluation

Pursuant to the provisions of the Companies Act, 2013 and LODR, the Board has carried out the annual performance evaluation of its own performance, the Directors Individually as well as the evaluation of the working of its Audit, Nomination and Remuneration and other Committees. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board's functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance.

A separate exercise was carried out to evaluate the performance of Individual Directors including the Chairman of the Board. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman was carried out by the Independent Directors who also reviewed the performance of the Secretarial Department. The Directors expressed their satisfaction with the evaluation process.

FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS

During the year no Independent director were appointed. All Independent Directors already on the Board are familiar with the organization.

MEETINGS OF THE BOARD OF DIRECTOR

As on March 31, 2018 the board consists of four Directors out of which one is promoter director, one non-executive director and two Independent directors. There is no Nominee Director on the Board.

No Director of the Company is either member of more than ten committees and/ or Chairman of more than five committees across all Companies in which he is Director and necessary disclosures to this effect has been received by the Company from all the Directors.

During the year, in all five Board Meetings were held i.e. on 30th May, 2017, 27th June, 2017, 12th September, 2017, 8th December, 2017 and 1 2th February, 201 8. The time gap between any two meetings was not more than 120 days.

The details of Directors and their attendance record at Board Meetings held during the year and at the last Annual General Meeting, number of other directorships and chairmanships/memberships of committees, and other Committees of the Company is given below:

# while considering the memberships/chairmanships only Audit Committee and Shareholders and investor Grievance Committee are considered.

Audit Committee

The Company has a Qualified Audit Committee as per the provisions of the Companies Act, 2013 and LODR. The composition, quorum, powers, role and scope are in accordance with Section 177 of the Companies Act, 2013 and the provisions of Regulation 18 of the Listing Regulation. The Committee consists of three Directors, Mr. ArvInd N. Nopany, Mr. Abhishek Patel and Mrs. Sheela Ayyar out of which two are Independent Directors. Mrs. Sheela Ayyar is the chairperson of the Committee.

The terms of reference to the Committee broadly are as under

1 Reviewing the quarterly and annual financial statements before submission to the Board.

2 Recommending to the Board the appointment, reappointment of the statutory auditors and fixing their remuneration.

3 Reviewing the internal control system and internal audit function.

4 Discussing with internal auditors, failure in internal control system and recommending measures for improvement.

5 Discussing with statutory auditors about the nature and scope of audit and post audit discussions on any area of concern.

6 To look into any defaults in payment to depositors, shareholders and creditors.

The Committee met on 29th May, 2017, to consider the Annual Accounts for the year ended 31.03.2017, on 26th June, 2017, to consider the recommendation of appointment of Statutory Auditor, on 12th September, 2017 to consider quarterly unaudited results for the quarter ended 30.06.2017,on 8th December, 2017 to consider the quarterly unaudited results for the quarter ended 30.09.2017 and on 12th February, 2017 to consider the nine months financial results.

The Meetings were attended by all the Members of the Committee.

Nomination & Remuneration Committee

The Company has a Nomination & Remuneration Committee as per the provisions of the Companies Act, 2013 and LODR. The Nomination & Remuneration committee consists of three Directors, Mr. Pranav Patel, Mr. ArvInd N. Nopany and Mr. Abhishek Patel out of which two are Independent Directors. Mr. ArvInd Nopany is chairperson of the Committee.

The Board has on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. Remuneration Committee approves the remuneration payable to the Managing Director and senior executives. The policy is available on the website of the Company.

The terms of reference to the Committee broadly are as under:

The Board has framed the Remuneration and Nomination Committee Charter which ensure effective Compliance of Section 178 of the Companies Act, 201 3 and Regulation 19 of Listing Regulation, which are as follows:

- Reviewing the overall compensation policy, service agreements and other employment conditions of Managing/whole-time Director(s) and Senior Management (one level below the Board):

- to help in determining the appropriate size, diversity and composition of the Board;

- to recommend to the Board appointment/reappointment and removal of Directors;

- to frame criteria for determining qualifications, positive attributes and Independence of Directors;

- to recommend to the Board remuneration payable to the Directors (while fixing the remuneration to Executive Directors the restrictions contained in the Companies Act, 2013 is to be considered);

- to create an evaluation framework for Independent Directors and the Board;

- to provide necessary reports to the Chairman after the evaluation process is completed by the Directors;

- to assist in developing a succession plan for the Board;

- to assist the Board in fulfilling responsibilities entrusted from time-to-time;

- delegation of any of its powers to any Member of the Committee or the Compliance Officer.

The Managing Director is paid remuneration of Rs. 6,00,000/- and is also entitled to the perquisits such as PF, Gratuity, and LTA.

Non-Executive Directors are paid Rs. 2500/- per Board Meeting attended and Rs. 2500/- per Audit Committee Meeting attended.

No stock options has been issued to any Directors.

Total Remuneration received by Mr. Abhishek Patel, Managing Director of the Company during the year 2017-2018 amounts to Rs. 72 lacs (excluding PF and Gratuity).

Stakeholders Relationship Committee

The Company has a Stakeholders Relationship Committee as per the provisions of the Companies Act, 2013 and LODR. The Committee consists of three directors out of which two are Independent Directors. Mr. ArvInd Nopany is the Chairman of the Committee. The Committee has been constituted to look into redressal of shareholders complaints and correspondence with SEBi and the Stock Exchange.

Details of shareholders' complaints received, solved and pending share transfers:

There are no complaints pending with the company.

Vigil mechanism for directors and employees

The Company has formulated whistle Blower Policy as per the SEBi (LODR) Regulations, 2015 to enable the employees to raise any concern, query and to deal with instance of fraud and mismanagement. The Company has a whistle blower policy to deal with instances of fraud and mismanagement, if any. The Policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination will be meted out to any person for a genuinely raised concern.

Risk Management Policy

The Company has developed a very comprehensive risk management policy under which all key risks and mitigation plans are compiled into a Risk Matrix. The same is reviewed quarterly by senior management and periodically also by the Risk Management Committee of the Board.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has taken adequate care and caution in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. The Company has not received any sexual harassment complaint during the year 2017 2018.

LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

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.

RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business.

Pursuant to section 134 read with rule of the Companies (Accounts) Rules, 2014, there are no transactions to be reported under section 188(1) of the Companies Act, 2013. The related party policy as approved by the Board is available on the website of the Company.

The disclosure in Form AOC-2 as per the provisions of Section 188 of the Companies Act, 2013 and rules made there under is not required since there are no material contracts or arrangements entered into by the Company as per the Policy of Materiality framed forming part of Related Party Transaction policy of the Company.

Related Party Transactions as required under Accounting Standards are reported under the notes to the financial statements.

The policy for determining material subsidiary and policy for dealing with related party transaction is available on the website of the Company www.rishitechtex.com.

PARTICULARS OF EMPLOYEES

The Statement containing particulars of employees as required and the ratio of remuneration of Managing Director to the median employees' remuneration and other details in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) and (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this report as “Annexure C”.

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 Sudhanwa S. Kalamkar & Associates, Company Secretary in practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed herewith as “Annexure D”.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Pursuant to provisions of the Companies Act, 2013, it is not applicable to the Company.

STATEMENT ON SALIENT FEATURES OF FINANCIAL STATEMENT

Statement on salient features of Financial Statement in Form AOC-3 is not required since Entire Annual Report is being sent to all Shareholders in the manner specified under Rule 11 of the Companies (Accounts) Rules, 2014.

MANAGEMENT DISCUSSION AND ANALYSIS

The management discussion and analysis on the operations of the Company is provided in a separate section and forms a part of this report.

CORPORATE GOVERNANCE REPORT

As per Regulation 27 (2) of the SEBi (Listing Obligations and Disclosure Requirements) Regulations 2015, every listed entity is required to submit on a quarterly basis a compliance report on corporate governance to Stock Exchange(s) where its securities are listed within fifteen days from close of the quarter.

Further the Regulation 1 5 (2) of SEBi (Listing Obligations and Disclosure Requirements) Regulations 2015, grants specific exemption from the applicability of regulations 27 to such entities whose paid up equity share capital does not exceed Rs. 10 Crores and net worth does not exceed Rs. 25 Crores, as on the last day of the previous financial year.

Since your company meets the exemption criteria as specified above the Corporate Governance provisions as per regulation 27 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are not applicable.

DIRECTORS’ RESPONSIBILITY STATEMENT

In terms of Section 134(3)(c) of the Companies Act, 2013 and to the best of their knowledge, belief and according to the information and explanations obtained by them, your Directors make the following statements that :

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

(b) the directors had 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 and loss of the company for that period;

(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) the directors had prepared the annual accounts on a going concern basis;

(e) the directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

(f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

ACKNOWLEDGEMENTS

The Directors place on record their appreciation for the efficient and loyal services rendered by the Staff and workmen, also acknowledge the help, support and guidance from the various Statutory Bodies, Government and Semi-Government Organisations and thank or customers, suppliers, investors for their continues support during the year. The Directors also acknowledge the help, support and guidance received from Canara Bank.

By Order of the Board of Directors

For Rishi Techtex Ltd.

Place: Mumbai Abhishek Patel

Date: 16.08.2018 (Chairman of the Board)