DIRECTORS' REPORT

To,

The Members,

SPENTA INTERNATIONAL LIMITED.

The Directors have great pleasure in presenting 29^th ANNUAL REPORT along with the Audited Balance Sheet and Profit and Loss Account, for the year ended 31^st March, 2016.

1. FINANCIAL RESULTS:

(Rs. In Lacs)

2. DIVIDEND AND TRANSFER TO RESERVES:

Your Directors are pleased to recommend a final Dividend of Rs. 1.20 per equity share of the face value of Rs. 10/- each for the approval of the shareholders.

The dividend, if approved by the shareholders at the forthcoming Annual General Meeting would absorb Rs. 33.17 lacs, excluding Rs. 6.75 lacs as tax on dividend. The dividend will be free of tax in the hands of the shareholders of the Company.

No amount is being transferred to reserves during the year under review.

3. FUTURE PROSPECTS :

Company is in the process of importing 46 socks knitting machines out of which 28 machines are new and 18 machines are pre-owned. This will increase company's production capacity by 10 % and reduce the dependence of the Company on outsourcing.

4. THE CHANGE IN THE NATURE OF BUSINESS, IF ANY;

There is no change in the nature of business of the Company.

5. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

Some workers of the company had declared a sudden strike in the factory during November 2015 and the production activities have been halted. In view of the above, the Company has entered into necessary initial negotiation with the workers.

Strike has been temporarily withdrawn from November 06, 2015 to March 31, 2016 as Management has entered into three years' agreement with workers and matter has been settled.

6. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

During the year there has been no change in the composition of Board of Directors of the Company.

Members of the Company approved payment of remuneration in the grade of Rs. 7,00,000 p.m to Mr. Sanjay Gadodia, whole time Director w.e.f 29^th September,2015.

7. NUMBER OF BOARD MEETINGS:

During the financial year, the Board had met seven times on 29^th May 2015, 8^th July 2015, 14^th August 2015, 8^th September 2015, 30^th September 2015, 9^th November 2015 and 12^th February 2016.

8. DECLARATION OF INDEPENDENT DIRECTORS:

The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(7) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

9. MEETING OF INDEPENDENT DIRECTORS:

The Independent Directors met once during the year on 12^th February, 2016 to review the working of the Company, its Board and Committees. The meeting decided on the process of evaluation of the Board and Audit Committee. It designed the questionnaire on limited parameters and completed the evaluation of the Board by Non-Executive Directors and of the Audit committee by other members of the Board. The same was compiled by Independent authority and informed to the members.

10. DIRECTORS RESPONSIBILITY STATEMENT:

The Board of Directors hereby confirms:

i) That in the preparation of the annual accounts, the applicable accounting standard had been followed along with proper explanation relating to material departures.

ii) That 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 or Loss of the Company for that period.

iii) That the Directors have taken proper and sufficient care for the maintenances of adequate accounting records in accordance with the provision of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv) That the Directors have prepared the Annual accounts on a going concern basis.

v) That 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.

vi) That the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating

11. SUBSIDIARIES AND ASSOCIATE COMPANY'S:

As on 31^st March, 2016, Company has no subsidiaries and associate companies.

12. DEPOSITS:

Your Company did not accept any deposits from the public during the year. There are no deposits which have not been claimed by depositors or paid by the company after the date on which the deposit became due for repayment or renewal, as the case may be, according to the contract with the depositors & there are no total amounts due to the depositors & remaining unclaimed or unpaid.

13. INTERNAL AUDITOR

As per section 138 of the Companies Act, 2013, the Company has appointed M/s. Rajesh K. Jain & Co., internal auditors for the year to 2016-2017 to conduct the internal audit and to ensure adequacy of the Internal controls, adherence to Company's policies and ensure statutory and other compliance through, periodical checks and internal audit.

14. STATUTORY AUDITORS:

M/s. A. R. Parikh & Co (Membership No. 38188), Chartered Accountants were appointed as Statutory Auditors at the Annual General Meeting held on 24th September, 2014 for the period of three (3) years. i.e. for the Annual General Meeting to be held in year 2017 subject to ratification at each Annual General Meeting. The Company has received letter from them to the effect that their appointment, if made, would be within the prescribed limits under Section 141(3) (g) of the Companies Act, 2013 and that they are not disqualified from appointment

The resolution for ratification of his appointment is put forward for your approval in the ensuing Annual General Meeting.

15. STATUTORY AUDITOR'S REPORT AND QUALIFICATION:

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. A. R. Parikh & Co, Statutory Auditors, in their report. The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review.

16. COST AUDITORS:

As per Section 148 read with Companies (Audit & Auditors) Rules, applicable to cost auditors, the company was not liable to appoint Cost auditors for the financial year 2015-16.

17. SECRETARIAL AUDITOR & REPORT

The Board has appointed Hemant Shetye, Partner of HS Associates, Practicing Company Secretaries as the Secretarial Auditor of the Company for the financial year 2016-2017. Also annexed herewith secretarial Audit report (MR-3), in Annexure-1 as provided by M/s. HS Associates, for the secretarial audit conducted by them for the period 2015-16 under review. The company is in the process of appointment of whole time company secretary however the company could not find suitable candidate for the post of whole time company secretary.

18. EXTRACT OF 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-2 and is attached to this Report.

19. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

The particulars of contracts or arrangements with related parties referred to in Section 188(1), as prescribed in Form AOC - 2 of the rules prescribed under Chapter IX relating to Accounts of Companies under the Companies Act, 2013, is appended as Annexure 3.

All Related Party Transactions are presented to the Audit Committee and the Board. Omnibus approval is obtained for the transactions which are foreseen and repetitive in nature. A statement of all related party transactions is presented before the Audit Committee on a quarterly basis, specifying the nature, value and terms and conditions of the transactions.

The Related Party Transactions Policy as approved by the Board is uploaded on the Company's website at www.spentasocks.com.

20. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013

The particulars of investment made under Section 186 of the Companies Act, 2013 have been disclosed in the financial statements in Schedule 13 of the Balance Sheet.

21. CONSERVATION OF ENERGY, TECHNOLOGY & FOREIGN EXCHANGE:

Information on conservation of energy, technology absorption, foreign exchange earnings and out go, is required to be given pursuant to provision of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 is annexed hereto marked Annexure-4 and forms part of this report.

22. CORPORATE GOVERNANCE REPORT

The company falls under the criteria 15(2) (a) of the Listing Obligations & Disclosure requirements (LODR) Regulations, 2015 as the Paid up capital of the company was below Rs. 10 Crores and net worth was below Rs. 25 Crores as on the last day of the previous financial year.

As on 31^st March, 2016, the Company's Paid up Capital is of Rs. 2,76,43,260 /- (Rupees Two Crore Seventy Six Lacs Forty Three Thousand Two Hundred Sixty only) and Net worth is of Rs.21,19,02,442/- (Rupees Twenty One Crore Nineteen Lacs Two Thousand Four Hundred Forty Two only).

Hence compliance with Corporate Governance provisions as per Listing Obligations & Disclosure requirements (LODR) Regulations, 2015 are not applicable to company.

23. PARTICULARS OF EMPLOYEES:

During the financial year there were no employees drawing salary exceeding Rs. 5 Lacs p.m if employed for a part of financial year and Rs. 60 lac p.a. if employed throughout the financial year. The information pursuant to Section 197 of the Act read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 relating to median employee's remuneration is annexed hereto marked Annexure-5 and forms part of this report.

24. MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT

The Management's Discussion and Analysis Report for the year under review, as stipulated under regulation 34 (3) and Part B of schedule V of the SEBI (Listing Obligation and Disclosure Requirement) Regulation 2015, is annexed to this report. (Annexure 6)

25. RISK MANAGEMENT POLICY:

The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives and thus in pursuance of the same it has formulated a Risk Management Policy to ensure compliance with revised clause 49 of the listing agreement. Major risks identified by the businesses and functions are systematically addressed and also discussed at the meetings of the Audit Committee and the Board of Directors of the Company.

The Company's internal control systems are commensurate with the nature of its business and the size and complexity of its operations. Significant audit observations and follow up actions thereon are reported to the Audit Committee and The risk management policy is available on the website of the company: www.spentasocks.com.

26. POLICY ON DIRECTORS APPOINTMENT, REMUNERATION & BOARDS PERFORMANCE:

During the year, the Board adopted a formal mechanism for evaluating its performance and as well as that of its Committees and individual Directors, including the Chairman of the Board. The exercise was carried out through a structured evaluation process covering various aspects of the Boards functioning such as composition of the Board & committees, experience & competencies, performance of specific duties & obligations, governance issues etc. Separate exercise was carried out to evaluate the performance of individual Directors including the Board Chairman who were evaluated on parameters such as attendance, contribution at the meetings and otherwise, independent judgment, safeguarding of minority shareholders interest etc.

The evaluation of the Independent Directors was carried out by the entire Board and that of the Chairman and the Non Independent Directors were carried out by the Independent Directors.

The Directors were satisfied with the evaluation results, which reflected the overall engagement of the Board and its Committees with the Company.

27. COMMITTEES OF THE BOARD:

During the year, in accordance with the Companies Act, 2013, the Board re-constituted some of its Committees. There are currently three Committees of the Board, as follows:

- Audit Committee

- Nomination and Remuneration Committee

- Stakeholders' Relationship Committee

28. WHISTLE BLOWER POLICY/VIGIL MECHANISM:

' The Company has established a vigil mechanism for Directors and employees to report their genuine concerns. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. Details of which have been given in the Corporate Governance Report annexed to this Report.

The Vigil Mechanism Policy is available at the website of the company: www.spentasocks.com.

29. DISCLOSURE UNDER SEXUAL HARASSMENT ACT:

As required by the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013, the Company has formulated and implemented a policy on prevention of sexual harassment at workplace with a mechanism of lodging complaints, redressal for the benefits of its employees. Currently there are 57 women employees' working with the Company and a senior women employee has been designated to receive complaints and report such cases to the Audit Committee in this behalf. There were no complaints filed by any of the women employees of the Company under this Act.

30. ACKNOWLEDGMENTS:

Your Directors wish to place on record their appreciation of the support which the Company has received from its promoters, lenders, business associates including distributors, vendors and customers, the press and the employees of the Company.

BY ORDER OF THE BOARD

Sd/-

SANJAY GADODIA

DATE: AUGUST 11,2016 (CHAIRMAN)

PLACE: PALGHAR DIN NO: 00203433