VST Balnce Sheet PDF

VST Industries Limited
August 3, 20 19
The General Manager The Manager

Listing Department Listing Department
BSE Lim ited National Stock Exchange of India Ltd.
Phir oze J eejeebhoy Towers "Exchange Plaza "
Dal al Street, Fort Bandra Kurla Complex, Bandra (E)
Mumbai - 400001 Mumbai - 400051
STOCK CODE : 509966 STOCK SYMBOL: VSTIND
Dear Sir,
Sub: Annual Report 2019
Further to our letter dated 26 th J uly, 2019, we enclose a copy of the An n ual
Report for the financial year ended 31 " March, 2019 and Notice of the Annual
General Meeting of the Company in compliance with Regulation 34 of SEBI
(Listing Obligations and Disclosure Requirements) Regulations , 2015 as
amended .
Please take the same on record.
Yours faithfully ,
For VST INDUSTRIES LIMITED
PHAN~
COMPANY S ECRETARY
Encl : As above.
Register ed O ffice: Aza ma ba d, Hyd er ab ad - 500 020: Phone : 9 1-40-27688000: Fax :9t-40-276 15336:
CIN: L29 1S0TG1930 PLC000576; Email:corporate@vstind.com;we bsite: www.vst hyd.com
ANNUAL REPORT 2018-19
CONTENTS
Page
Board of Directors .. .. .. .. .. .. .. .. .. 3
Notice of Meeting .. .. .. .. .. .. .. .. .. 4
Report of the Board of Directors &

Management Discussion and Analysis .. .. .. .. .. .. .. .. .. 15
Annexure to the Directors’ Report .. .. .. .. .. .. .. .. .. 27
Business Responsibility Report (BRR) .. .. .. .. .. .. .. .. .. 69
Independent Auditors’ Report .. .. .. .. .. .. .. .. .. 74
Balance Sheet .. .. .. .. .. .. .. .. .. 82
Statement of Profit and Loss .. .. .. .. .. .. .. .. .. 83
Cash Flow Statement .. .. .. .. .. .. .. .. .. 85
Notes to Financial Statement .. .. .. .. .. .. .. .. .. 86
Operating Results .. .. .. .. .. .. .. .. .. 111
Proxy Form .. .. .. .. .. .. .. .. . 113
73
2 Annual Report 2018-19
BOARD OF DIRECTORS
Directors NARESH KUMAR SETHI * Chairman

(DIN 08296486)
PRADEEP V. BHIDE # Chairman
(DIN 03304262)
DEVRAJ LAHIRI Managing Director
(DIN 03588071)
S. THIRUMALAI
(DIN 00011899)
MUBEEN RAFAT
(DIN 02097314)
RAMA BIJAPURKAR @
(DIN 00001835)
SUDIP BANDYOPADHYAY $
(DIN 00007382)
RAJIV GULATI ^
(DIN 06820663)
RAMAKRISHNA V. ADDANKI *
(DIN 07147591)
Chief Financial Officer ANISH GUPTA
Company Secretary PHANI K. MANGIPUDI
Auditors B S R & ASSOCIATES LLP

Chartered Accountants
Hyderabad – 500 034
Registered Office 1-7-1063/1065, Azamabad

Hyderabad – 500 020, Telangana
Telephone : +91 40 2768 8000
Fax : +91 40 2761 5336
E-mail : investors@vstind.com
Website : www.vsthyd.com
CIN : L29150TG1930PLC000576
Registrar & Share Karvy Fintech Private Limited
Transfer Agents Karvy Selenium Tower B, Plot No.31 & 32
Financial District, Nanakramguda, Gachibowli
Hyderabad – 500 032, Telangana
Phone : +91 40 6716 2222
Fax : +91 40 2342 0814
E-mail : einward.ris@karvy.com
Website : www.karvy.com
*
Mr. Ramakrishna V. Addanki has resigned as Director with effect from 14th December, 2018. Mr. Naresh Kumar Sethi
has been appointed as Director in place of Mr. Ramakrishna V. Addanki and elected as Chairman of the Company.
#
Mr. Pradeep V. Bhide resigned as a Director and consequently as a Chairman with effect from 1st July, 2019.
@
Ms. Rama Bijapurkar has been appointed as Additional Independent Director with effect from 1st April, 2019.
$
Mr. Sudip Bandyopadhyay has been appointed as Additional Independent Director with effect from 1st June, 2019.
^
Mr. Rajiv Gulati has been appointed as Additional Independent Director with effect from 26th July, 2019.
Annual Report 2018-19 73

3
NOTICE OF MEETING
NOTICE is hereby given that the Eighty Eighth Annual Regulation 17 of the Securities and Exchange Board of
General Meeting of VST INDUSTRIES LIMITED will be held India (Listing Obligations and Disclosure Requirements)
at Hotel Taj Krishna, Road No. 1, Banjara Hills, Hyderabad Regulations, 2015, as amended, Mr.Sudip
– 500 034 on Wednesday, 28th August, 2019 at Bandyopadhyay [DIN:00007382] be and is hereby
9.30 a.m. for transacting the following business : appointed as an Independent Director of the Company
ORDINARY BUSINESS for a period of five years from 1st June, 2019 to 31st
May, 2024 or for such other period as may be
1. To consider and adopt the Audited Financial Statements determined by applicable statutes or regulations.”
of the Company for the year ended 31st March, 2019,
and the Reports of the Board of Directors and Auditors. 7. To consider and, if thought fit, to pass with or without
modification(s), the following Resolution as an Ordinary
2. To declare a Dividend on the Equity Shares for the year Resolution:
ended 31st March, 2019.
“RESOLVED THAT pursuant to Section 149, 152 &160
3. To appoint a Director in place of Mr. S. Thirumalai read with Schedule IV of the Companies Act, 2013 and
[DIN: 00011899] who retires by rotation and being Regulation 17 of the Securities and Exchange Board of
eligible, offers himself for re-appointment. India (Listing Obligations and Disclosure Requirements)
SPECIAL BUSINESS Regulations, 2015, as amended, Mr. Rajiv Gulati
[DIN:06820663] be and is hereby appointed as an
4. To consider and, if thought fit, to pass with or without
Independent Director of the Company for a period of
five years from 26th July, 2019 to 25th July, 2024 or for
Resolution:
such other period as may be determined by applicable
“RESOLVED THAT Mr. Naresh Kumar Sethi statutes or regulations.”
[DIN:08296486], a nominee of the Raleigh Investment
Company Limited, a British American Tobacco group
Company who was appointed as a Director of the
Resolution:
Company with effect from 14th December, 2018 in the
place of Mr. Ramakrishna V. Addanki [DIN:07147591], “RESOLVED THAT pursuant to Section 197 of the
and who vacates office at the ensuing Annual General Companies Act, 2013 as amended, approval be and is
Meeting, be and is hereby appointed as a Director of hereby accorded for a variation in the terms of
the Company in terms of Sections 152 & 160 of the remuneration paid / payable to Mr. Devraj Lahiri (DIN:
Companies Act, 2013 as amended, whose period of 03588071), Managing Director, with effect from 1st
office shall be liable to determination by retirement of November, 2018 and a further variation with effect from
Directors by rotation.” 1st April, 2019, as set out in the Explanatory Statement
annexed to the Notice convening this Meeting.”
Resolution:
Resolution:
“RESOLVED THAT pursuant to Section 149, 152 & 160
“RESOLVED THAT pursuant to Section 197 of the
read with Schedule IV of the Companies Act, 2013 and
Companies Act, 2013 and Regulation 17 of the Securities
Regulation 17 of the Securities and Exchange Board of
and Exchange Board of India (Listing Obligations and
India (Listing Obligations and Disclosure Requirements)
Disclosure Requirements) Regulations, 2015, as
Regulations, 2015, as amended, Ms. Rama Bijapurkar
amended, approval be and is hereby accorded to the
[DIN:00001835] be and is hereby appointed as an
remuneration payable to Mr. Naresh Kumar Sethi
Independent Director of the Company for a period of
[DIN:08296486], Non-Executive Director, in addition to
five years from 1st April, 2019 to 31st March, 2024 or
the remuneration as applicable to the other Non-
for such other period as may be determined by
Executive Directors of the Company for a period of up
applicable statutes or regulations.”
to 3 years with effect from 1st August, 2019 within the
6. To consider and, if thought fit, to pass with or without applicable limits prescribed under the Companies Act,
modification(s), the following Resolution as an Ordinary 2013 and SEBI Regulations as amended and more
Resolution: specifically set out in the Explanatory Statement annexed
“RESOLVED THAT pursuant to Section 149, 152 &160 to the Notice convening this Meeting.”
read with Schedule IV of the Companies Act, 2013 and 10. To consider and, if thought fit, to pass with or without
73
NOTICE OF MEETING
modification(s), the following Resolution as an Ordinary appear in the Register of Members of the Company on
Resolution: 28th August, 2019 or to their mandatees, subject
“RESOLVED THAT pursuant to Section 197 of the however to the provisions of Section 126 of the
Companies Act, 2013 and Regulation 17 of the Securities Companies Act, 2013 or any amendment thereto or re-
and Exchange Board of India (Listing Obligations and enactment thereof. In respect of dematerialized shares
Disclosure Requirements) Regulations, 2015, as the dividend will be payable on the basis of beneficial
amended, approval be and is hereby accorded to the ownership as on 20th August, 2019, as per details to
remuneration payable to Mr. S. Thirumalai be furnished by National Securities Depository Limited
[DIN:00011899], Non-Executive Director, in addition to (NSDL) and Central Depository Services (India) Limited
the remuneration as applicable to the other Non- (CDSL) for this purpose.
Executive Directors of the Company for a period of up 4. Corporate members are requested to send, a duly
to 3 years with effect from 1st August, 2019 within the certified copy of the Board Resolution pursuant to Section
applicable limits prescribed under the Companies Act, 113 of the Companies Act, 2013 authorizing their
2013 and SEBI Regulations as amended and more representative to attend and vote on their behalf at the
specifically set out in the Explanatory Statement annexed AGM.
to the Notice convening this Meeting.” 5. Brief profile of the Directors proposed to be appointed/
NOTES : re-appointed is given in the Directors' Report. None of
1. In accordance with Section 102 of the Companies Act, the Directors is related to one another.
2013, Statement setting out the material facts in respect 6. Members holding shares in physical form should inform
of Special Business is to be annexed to the Notice of the the Company's Registrar and Transfer Agents, M/s. Karvy
Meeting. Fintech Private Limited of any change in their registered
2. A Member entitled to attend and vote at the address, mandate/bank details/e-mail address.
Annual General Meeting (AGM) is entitled to Similarly, Members holding shares in electronic form
appoint a proxy to attend and vote instead should inform their Depository Participants (DP) of any
of himself/herself and the proxy need not be change in their registered address, mandate/bank
a member of the Company. The instrument of details/e-mail address.
proxy in order to be effective, must be 7. The shares of the Company are under compulsory demat
deposited at the Registered Office of the trading. Members holding shares in physical form are
Company, duly completed and signed, not less requested to convert their shares into dematerialized form
than 48 hours before the commencement of in their own interest and for their convenience. As per
the Meeting. SEBI Notification No. SEBI/LAD-NRO/GN/2018/24
A person can act as a proxy on behalf of dated June 8, 2018 and further amendment vide
Members not exceeding fifty and holding in Notification No. SEBI/LAD-NRO/GN/2018/49 dated
the aggregate not more than ten percent of November 30, 2018, requests for effecting transfer of
the total share capital of the Company securities (except in case of transmission or transposition
carrying voting rights. A Member holding of securities) shall not be processed from April 1, 2019
more than ten percent of the total share unless the securities are held in the dematerialized form
capital of the Company carrying voting rights with the depositories.
may appoint a single person as proxy and such 8. SEBI has directed listed companies to use electronic
person shall not act as a proxy for any other payment modes such as NEFT, RTGS, ECS etc., for
person or Member. payment to the investors. Members are requested to
3. The Register of Members of the Company shall remain update their bank details such as MICR, IFSC code etc.,
closed from Wednesday, 21st August, 2019 to with the Registrar and Transfer Agents, M/s. Karvy Fintech
Wednesday, 28th August, 2019 (both days inclusive) for Private Limited by submitting a cancelled cheque, while
payment of dividend, if declared. Members holding shares in electronic form are requested
Valid transfer of shares received at the office of Registrar to update such bank details with their respective
and Transfer Agents of the Company, M/s. Karvy Fintech Depository Participants.
Private Limited, before the close of business hours on 9. Members who have multiple folios in identical names or
20th August, 2019 will be registered in time for the joint names in the same order are requested to intimate
transferees to become eligible for dividend, if declared. the Registrar and Transfer Agents, M/s. Karvy Fintech
Dividend, if declared, will be paid within 30 days from Private Limited about these folios to enable consolidation
the date of the AGM to those Members whose names of all such shareholdings into one folio.

5
NOTICE OF MEETING
10. The Securities and Exchange Board of India (SEBI) vide Companies (Management and Administration)
circular ref no. MRD/DoP/CIR-05/2007 dated April 27, Amendment Rules, 2015 and Clause 44 of SEBI (Listing
2007, made PAN the sole identification number for all Obligations and Disclosure Requirements) Regulations,
participants transacting in the securities market, 2015, the Company is pleased to offer voting by
irrespective of the amount of transaction. In continuation electronic means to the Members to cast their votes
of the aforesaid circular, it is hereby clarified that for electronically on all items of business set forth in this
securities market transactions and off market/private Notice. The detailed instructions for e-voting are given
transactions involving transfer of shares of listed as a separate attachment to this Notice.
companies in physical form, it shall be mandatory for 17. The facility for voting, either through electronic voting
the transferee(s) to furnish copy of PAN card to the system or ballot or polling paper shall also be made
Company/Registrar and Share Transfer Agent for available at the Meeting and Members attending the
registration of such transfer of shares. Meeting who have not already cast their vote by remote
11. Members holding shares in single name and physical e-voting shall be able to exercise their right at the
form are advised to make nomination in respect of their Meeting.
shareholding in the Company. The Nomination Form 18. The Members who have cast their vote by remote
SH 13 prescribed under the Companies Act, 2013 can e-voting prior to the Meeting may also attend the Meeting
be obtained from the Registrar and Transfer Agent or but shall not be entitled to cast their vote again.
can be downloaded from the Company’s website
The Company has appointed Mr. Tumuluru Krishnamurty
www.vsthyd.com.
or failing him Mr. B.V. Saravana Kumar, Company
12. Members are requested to refer to the “Shareholder Secretaries in Practice, who in the opinion of the Board
Referencer” of the Report on Corporate Governance are duly qualified persons, as a Scrutinizer who will
which inter-alia contains details regarding unclaimed scrutinize the electronic voting process in a fair and
dividend. Members wishing to claim dividends that transparent manner. The Scrutinizer shall within a period
remain unclaimed are requested to correspond with the of three days from the date of conclusion of the meeting,
Registrar and Share Transfer Agents as mentioned above, submit his report of the votes cast in favour or against, if
or to the Company Secretary, at the Company’s any, to the Chairman of the Company and the result of
registered office. Members are requested to note that the same will be disclosed forthwith. The Company has
dividends that are not claimed within seven years from appointed M/s. Karvy Fintech Private Limited as the
the date of transfer to the Company’s unclaimed Agency for the purpose of facilitating the electronic
dividend account, will, as per Section 124 of the voting.
Companies Act, 2013, be transferred to the Investor 19. Pursuant to Section 101 and Section 136 of the
Education and Protection Fund (IEPF). Shares on which Companies Act, 2013 read with the Companies
dividend remains unclaimed for seven consecutive years (Management and Administration Rules), 2014,
will also be transferred to the IEPF as per Section 124 of companies can serve Annual Reports and other
the aforesaid Act, and applicable Rules thereunder. communications through electronic mode to those
13. Members are requested to bring their copy of the Annual Members who have registered their e-mail address either
Report to the Meeting. with the Company or with the Depository. Members who
14. For the convenience of Members and for proper conduct have not registered their e-mail address with the
of the meeting, entry to the venue of the Meeting will be Company are requested to submit their request with their
regulated by Attendance Slip, which is enclosed with this valid e-mail address to M/s Karvy Fintech Private Limited.
Notice. Members are requested to sign at the place Members holding shares in demat form are requested
provided on the Attendance Slip and hand it over at the to register/update their e-mail address with their
entrance to the venue. Members and proxies are Depository Participant(s) directly. The Members will be
also requested to carry a valid ID proof. entitled to a physical copy of the Annual Report for the
financial year 2018-19, free of cost upon sending a
15. The documents referred to in this Notice are open for
written request either to the Company or to the Registrar
inspection at the Registered Office of the Company on
& Transfer Agent.
all working days, except Saturdays & Sundays, between
11.00 a.m. and 1.00 p.m. up to the date of AGM. By Order of the Board
16. Pursuant to Section 108 of Companies Act, 2013 read PHANI K. MANGIPUDI
with Rule 20 of Companies (Management and Dated this 26th day of July, 2019 Company Secretary
Administration) Rules, 2014 as substituted by the Azamabad, Hyderabad-500 020.
73
NOTICE OF MEETING
Statement pursuant to Section 102(1) of Companies Act, 2013

Item No. 4 and based on the recommendation of the Nomination &
Remuneration Committee, approved the appointment of
Mr. Naresh Kumar Sethi [DIN:08296486], a nominee of
Ms. Rama Bijapurkar [DIN:00001835], as an Additional
the Raleigh Investment Company Limited, a British American
(Independent) Director of the Company, subject to the
Tobacco group Company was appointed as a Director of
approval of the shareholders. The appointment is with effect
the Company with effect from 14th December, 2018 in the
from 1st April, 2019 for a period of five years up to 31st
casual vacancy arising out of resignation of Mr. Ramakrishna
March, 2024 in terms of Section 149 read with Schedule IV
V. Addanki [DIN:07147591] as per the recommendation of
of the Companies Act, 2013 and Regulation 17 of the Listing
the Nomination & Remuneration Committee.
Regulations, as amended.
Mr. Naresh Kumar Sethi's [53 years] career spans 29 years
The Board has evaluated the veracity of the declarations
as a Global Marketer, General Manager and Strategy
provided by Ms. Bijapurkar and confirm that in the opinion
Transformation Officer. He has held various marketing roles
of the Board, she fulfills the criteria of independence
in India, Indonesia, West Africa Area and Australasia prior
prescribed under Section 149 of the Companies Act, 2013
to moving to Japan as President of British American Tobacco,
and Regulation 16(1)(b) of the Listing Regulations, as
Japan. In December 2011, Mr. Sethi became the first Indian/
amended.
Asian to be appointed to the Management Board of British
American Tobacco reporting to the CEO. In 2013, he became Ms. Rama Bijapurkar [62 years] is a recognized thought
the Director for the Western Europe Region. In 2017 he was leader on market strategy and India’s consumer economy.
appointed as the Business Development Director responsible She has an independent management consulting practice
for Strategy, Enterprise Transformation, Global IT and Global and works with a range of global and domestic companies,
Business Services. He was also responsible for the integration across sectors, helping them in the development of their
of recently acquired Reynolds American. Mr. Sethi has also business-market strategy. She is an experienced Independent
been on the advisory Board of Hands On Tokyo, a Non- Director and has served on the boards of several of India’s
Profit organization based in Tokyo. blue chip companies.
Mr. Sethi is a chemical engineer from Indian Institute of She is a chairperson and co-founder of People Research on
Technology, Varanasi and has an MBA from the Indian India’s Consumer Economy, a not-for-profit think tank and
Institute of Management, Calcutta, India. fact tank, dedicated to providing ‘household and people-
level’ data and insights for business strategy and public policy.
The consent pursuant to Section 152(5) of the Companies She has been a member of the governing council of the
Act, 2013, to act as a Director if appointed, has been received Banking Codes and Standards Board of India (set up by the
from Mr. Naresh Kumar Sethi. Mr. Sethi does not hold any banking regulator), and of the Eminent Persons Advisory
shares in the Company. Group of the Competition Commission of India. She has
Additional information in respect of Mr. Sethi, pursuant to been a regular visiting faculty at the Indian Institute of
the Securities and Exchange Board of India (Listing Management, Ahmedabad (IIMA), her alma mater, and has
Obligations and Disclosure Requirements) Regulations, 2015 till recently served on its Board of Governors. Ms. Bijapurkar
[Listing Regulations] and the Secretarial Standard on General is a dominant voice in the Indian media on business and
Meetings is included in the Directors’ Report and its policy issues. She is also the author of several books on
Annexures. consumerism.
None of the Directors or Key Managerial Personnel or their Ms. Bijapurkar holds a B.Sc.(Hons) degree in Physics from
relatives other than Mr.Naresh Kumar Sethi has any concern Delhi University and a post graduate diploma in
or interest, financial or otherwise in this Resolution. management from the Indian Institute of Management,
Ahmedabad (1975-1977). Prior to setting up her own
The Board recommends this item of business for your
consulting practice, she worked in market research and
approval.
strategy consulting with MARG (now Nielsen India), Mode
Item No. 5 Services (now TNS India), McKinsey & Company and as a
The Board of Directors at their Meeting held on 12th March, full time consultant with Hindustan Lever Limited.
2019, considering the requisite qualifications and experience The consent pursuant to Section 152(5) of the Companies

7
NOTICE OF MEETING
Act, 2013 to act as Director if appointed, has been received Post ITC, Mr. Bandyopadhyay was the Managing Director of
from Ms. Rama Bijapurkar. Ms. Bijapurkar does not hold Reliance Money and also on the Board of several Reliance
any shares in the Company. ADA Group companies. He was instrumental in leading
Additional information in respect of Ms. Bijapurkar, pursuant Reliance Anil Dhirubhai Ambani Group’s foray, amongst
to the Listing Regulations and the Secretarial Standard on others, into Financial Products Distribution, Commodity
General Meetings is included in the Directors’ Report and Exchanges, Money Changing and Money Transfer. Under
its Annexures. his leadership, Reliance Money had aggressively expanded
its footprint in India and across the globe. He was also
None of the Directors or Key Managerial Personnel or their
responsible for the acquisition of AMP Sanmar through which
relatives other than Ms. Rama Bijapurkar has any concern
Reliance launched its Life Insurance business.
or interest, financial or otherwise in this Resolution.
Thereafter, Mr. Bandyopadhyay was appointed as the
The Board recommends this item of business for your
Managing Director and CEO of Destimoney, a full service
approval.
financial organization, promoted by New Silk Route–an Asia
Item No. 6 focused growth capital private equity firm with over $1.4
The Board of Directors at their Meeting held on 3rd May, billion under management.
2019, considering the requisite qualifications and experience Mr. Bandyopadhyay is currently the Group Chairman of
and based on the recommendation of the Nomination & Inditrade (JRG) Group of Companies. Inditrade has
Remuneration Committee, approved the appointment of significant presence in Agri Commodity Financing, Micro
Mr. Sudip Bandyopadhyay [DIN:00007382], as an Finance business and MSME lending. He sits on the Boards
Additional (Independent) Director of the Company, subject of a number of listed and unlisted domestic companies. He
to the approval of the shareholders. This is with effect from is also an investor in many Fintech and other Technology
1st June, 2019 for a period of five years up to 31st May, related ventures. He has significant presence in business
2024 in terms of Section 149 read with Schedule IV of the media through his regular interaction on leading business
Companies Act, 2013 and Regulation 17 of the Listing channels, business newspapers and magazines.
Regulations, as amended.
The consent pursuant to Section 152(5) of the Companies
The Board has evaluated the veracity of the declarations Act, 2013 to act as Director if appointed, has been received
provided by Mr. Bandyopadhyay and confirm that in the from Mr.Sudip Bandyopadhyay. Mr. Bandyopadhyay does
opinion of the Board, he fulfils the criteria of independence not hold any shares in the Company.
prescribed under Section 149 of the Companies Act, 2013
Additional information in respect of Mr. Bandyopadhyay,
and Regulation 16(1)(b) of the Listing Regulations, as
pursuant to the Listing Regulations and the Secretarial
amended.
Standard on General Meetings is included in the Directors’
Mr. Sudip Bandyopadhyay [55 years] is a rank holder Report and its Annexures.
Chartered Accountant and a Cost Accountant with over 31
None of the Directors or Key Managerial Personnel or their
years of rich and diverse experience in various areas of
relatives other than Mr. Sudip Bandyopadhyay has any
finance and financial services. He is also a Gold Medalist
concern or interest, financial or otherwise in this Resolution.
from Calcutta University. His more than three decades of
professional stint with large organisations has provided him The Board recommends this item of business for your
with rich experience & expertise in the areas of finance and approval.
financial markets including equity, commodity and currency Item No. 7
markets, trading, lending, distribution etc. The Board of Directors at their Meeting held on 26th July,
After qualification, Mr. Bandyopadhyay joined Hindustan 2019, considering the requisite qualifications and experience
Lever Limited and then spent 16 years with ITC Limited in and based on the recommendation of the Nomination &
various roles including a long stint as Head of Treasury and Remuneration Committee, approved the appointment of
Strategic Investments. He managed investments in excess of Mr. Rajiv Gulati [DIN:06820663], as an Additional
$1.5 billion and all treasury operations including capital, (Independent) Director of the Company, subject to the
currency and money markets for ITC. Mr. Bandyopadhyay approval of the shareholders. This is with effect from 26th
was also responsible for the acquisition of strategic stakes July, 2019 for a period of five years up to 25th July, 2024 in
in multiple companies by ITC Limited. terms of Section 149 read with Schedule IV of the Companies
73
NOTICE OF MEETING
Act, 2013 and Regulation 17 of the Listing Regulations, as General Meetings is included in the Directors’ Report and
amended. its Annexures.
The Board has evaluated the veracity of the declarations None of the Directors or Key Managerial Personnel or their
provided by Mr. Gulati and confirm that in the opinion of relatives other than Mr. Rajiv Gulati has any concern or
the Board, he fulfils the criteria of independence prescribed interest, financial or otherwise in this Resolution.
under Section 149 of the Companies Act, 2013 and The Board recommends this item of business for your
Regulation 16(1)(b) of the Listing Regulations, as amended. approval.
Mr. Rajiv Gulati [62 years] is an Independent Consultant Item No. 8
advising several PE firms such as Multiples, Capital Group, The Board of Directors of the Company at their Meeting
Samara etc. in making judicious investments in the held on 31st October 2017, on the recommendation of the
Pharmaceutical sector. Mr. Gulati serves on Advisory Board Nomination & Remuneration Committee, approved the
of Infinion Biopharma. Mr. Gulati has been an Independent appointment of Mr. Devraj Lahiri as the Managing Director
Director on the Board of Pharmaceutical companies such of the Company with effect from 28th November, 2017 to
as Eris Life Sciences and UTH. He is also mentoring Essentium 27th November, 2022 subject to the approval of the
Phygen, a unique consumer health company. shareholders. The shareholders, at the eighty seventh Annual
Prior to this, Mr. Gulati was President-Global Pharmaceuticals General Meeting held on 28th September, 2018, approved
Business, for Ranbaxy Laboratories Limited, located at their the appointment along with the terms and conditions.
Global Headquarters from April 2011 to November 2014. The Board of Directors at their Meetings held on 1st
Before joining Ranbaxy in April 2011, he was Global Head November, 2018 and 12th March, 2019, based on the
of Anti-counterfeiting operations of Eli Lilly and Company, recommendation of the Nomination & Remuneration
USA and has done pioneering work in helping fight the Committee, approved, subject to the approval of the
menace of fake medicines. Shareholders, a variation to the Consolidated salary and
Other allowance to the extent modified below, to the original
Mr. Gulati has also been the Head of Emerging Market
terms of remuneration of Mr. Lahiri for the residual period
Strategy, as part of Corporate Strategic planning function
of his present term of appointment:
for Eli Lilly & Company working at their Global Head Office
at Indianapolis, USA. Mr. Gulati has also been the Chairman Period Description Amount
and Managing Director of Eli Lilly in India and several South 1st November, Consolidated ` 6,25,000/-
Asian Countries. 2018 to 31st Salary per
March, 2019 month
Mr. Gulati is a well-known veteran with three decades of
rich Pharma industry experience. He has completed his
1st April, 2019 till Consolidated ` 8,73,000/-
the residual period Salary per
Masters in Pharmaceutical Technology from IIT-Varanasi and
of his present term month
MBA from IIM, Ahmedabad. He enjoys teaching and has
of appointment Other Not exceeding 50% of
delivered lectures at Wharton Business School – U Penn,
Kelley Business School – IU, Booth – University of Chicago Allowance Consolidated Salary,
and has been part of external Advisory Board of College of payable monthly, as
Business and Economics, Australian National University. He may be determined
has been Pharma Chair of American Chamber of Commerce by the Board from
and Indo American Chamber of Commerce in the past. time to time.
Currently Mr. Gulati serves as Trustee of Delhi Pharmaceutical The other terms of remuneration of Mr. Lahiri, as approved
Trust. by the Members at the 87th Annual General Meeting held
on 28th September, 2018, remain unchanged.
The consent pursuant to Section 152(5) of the Companies
The above may be treated as a modification to the written
Act, 2013 to act as Director if appointed, has been received
memorandum setting out the terms of appointment of
from Mr. Gulati. He does not hold any shares in the
Mr. Devraj Lahiri under Section 190 of Companies Act, 2013.
Company.
Mr. Devraj Lahiri [46 years] is a Commerce Graduate from
Additional information in respect of Mr. Gulati, pursuant to St. Xavier’s College, Kolkata and Masters in Business
the Listing Regulations and the Secretarial Standard on Administration from Indian Institute of Social Welfare and

9
NOTICE OF MEETING
Business Management, Kolkata. He joined the Company in None of the Directors or Key Managerial Personnel or their
the year 2001 and has made significant contributions during relatives other than Mr. Naresh Kumar Sethi has any concern
his association with the Company. He was elevated to the or interest, financial or otherwise in this Resolution.
level of Marketing Head and was appointed as a Wholetime The Board recommends this item of business for your
Director of the Company with effect from 1st August, 2011. approval.
He is a member of the CSR Committee, Stakeholders The Board recommends this item of business for your
Relationship Committee and Risk Management Committee approval.
of the Company and is also a Director on the board of The
Item No. 10
Tobacco Institute of India. He has been instrumental in the
growth of the Company and has successfully launched Mr. S. Thirumalai, the Independent Director of the Company,
various new brands. Mr. Lahiri does not hold any shares in is being reclassified as the Non-executive Non-Independent
the Company and is not related to any other Director of the Director in compliance with the provisions of Section
Company. 152(6)(a) of the Companies Act, 2013 read with the Rules
issued thereunder and the Listing Regulations. His office is
Apart from Mr. Devraj Lahiri, Managing Director who is now subject to determination of Directors liable to retire by
interested in his remuneration, none of the other Directors rotation. The Board of Directors at their Meeting held on
and Key Managerial Personnel of the Company or their 26th July, 2019 approved this reclassification.
relatives are, in any way, concerned or interested financially
Mr. Thirumalai [70 years] is a Fellow Member of Institute of
or otherwise in this item of business.
Chartered Accountants of India, Institute of Company
The Board recommends this item of business for your Secretaries of India, Certified Associate of Indian Institute of
approval. Bankers and a law graduate. He has also attended the
Item No. 9 Advanced Management Program at Harvard Business
The Board of Directors at their Meeting held on 14th School, Boston, USA. He has diversified experience of over
December, 2018 approved the appointment of Mr. Naresh four decades and specializes in Finance, Taxation and Legal
Kumar Sethi as a Director in the casual vacancy caused by affairs, especially in the tobacco sector.
the resignation of Mr. Ramakrishna V. Addanki. He is being The Board of Directors, basis the recommendation of the
regularized as a Director whose period of office shall be Nomination & Remuneration Committee, and considering
liable to determination by retirement of Directors by rotation his vast and diversified experience, approved, an annual
in this Annual General Meeting. prorated remuneration up to ` 25 lakhs payable monthly
The Board of Directors at their Meeting held on 26th July, from 1st August, 2019 for a period up to 3 years subject to
2019, on the recommendation of the Nomination & the approval of the shareholders.
Remuneration Committee, considering the rich experience In addition to receiving the sitting fees for attending the
of Mr. Sethi in the global tobacco industry at top executive Meetings of the Board and Committees thereof,
positions coupled with specialized knowledge in the core Mr. S. Thirumalai would be entitled to remuneration by way
business activity of the Company, which it wishes to leverage of commission to the Non-Executive Directors as approved
and benefit from his guidance and also considering his by the Members at the 87th Annual General Meeting of the
enlarged role as the Non-Executive Chairman, approved Company.
an annual prorated remuneration up to ` 1.25 crores The total remuneration, including commission to be paid to
payable monthly from 1st August, 2019 for a period up to 3 the Non-Executive Directors of the Company shall not exceed
years subject to the approval of the shareholders. 1% of the Company’s net profits in terms of Section 197
In addition to receiving the sitting fees for attending the and computed under Section 198 of the Companies Act,
Meetings of the Board and Committees thereof, Mr. Naresh 2013 and shall be in compliance with the provisions of
Kumar Sethi would be entitled to remuneration by way of Regulation 17(6)(ca) of the Listing Regulations, as amended.
commission to the Non-Executive Directors as approved by None of the Directors or Key Managerial Personnel or their
the Members at the 87th Annual General Meeting of the relatives other than Mr. S. Thirumalai has any concern or
Company. interest, financial or otherwise in this Resolution.
The total remuneration, including commission to be paid to The Board recommends this item of business for your
the Non-Executive Directors of the Company shall not exceed approval.
1% of the Company’s net profits in terms of Section 197 By Order of the Board
and computed under Section 198 of the Companies Act, PHANI K. MANGIPUDI
2013 and shall be in compliance with the provisions of Dated this 26th day of July, 2019 Company Secretary
Regulation 17(6)(ca) of the Listing Regulations as amended. Azamabad, Hyderabad - 500 020.
10
NOTICE OF MEETING
INSTRUCTIONS FOR REMOTE E-VOTING may enter partially any number in FOR and partially in
AGAINST but the total number in FOR/AGAINST taken
1. Use the following URL for e-voting from Karvy website :
together should not exceed the total shareholding. You
https://evoting.karvy.com.
may also choose the option ABSTAIN.
2. Members of the Company holding shares either in
physical form or in dematerialized form, as on 20th 8. Members holding multiple folios/demat account shall
August, 2019, the cut off date may cast their vote choose the voting process separately for each folio/demat
electronically. account.
3. Enter the login credentials [i.e., user id and password 9. Cast your vote by selecting an appropriate option and
mentioned in the Attendance Slip enclosed with this click on SUBMIT. A confirmation box will be displayed.
Notice]. Your Folio No/DP ID Client ID will be your user Click OK to confirm else CANCEL to modify. Once you
ID. confirm, you will not be allowed to modify your vote.
4. After entering the details appropriately, click on LOGIN. During the voting period, Members can login any number
of times till they have voted on the resolution.
5. You will reach the password change menu wherein you
are required to mandatorily change your password. The 10. Once the vote on the resolution is cast by the Member,
new password shall comprise of minimum 8 characters he/she shall not be allowed to change it subsequently.
with at least one upper case (A-Z), one lower case (a-z),
11. The Portal will be open for voting from 9.00 a.m. on 24th
one numeric value (0-9) and a special character. The
August, 2019 and closes at 5.00 p.m. on 27th August,
system will prompt you to change your password and
2019.
update any contact details like mobile, email etc on first
login. You may also enter the secret question and answer 12. Members of the Company who have purchased their
of your choice to retrieve your password in case you shares after the dispatch of the Notice but before the cut
forget it. It is strongly recommended not to share your off date (20th August, 2019) may contact M/s. Karvy
password with any other person and take utmost care Fintech Pvt Ltd at Tel No. 1800 345 4001 (toll free) to
to keep your password confidential. obtain login id and password.
6. You need to login again with the new credentials. On
13. In case of any queries, you may refer the Frequently Asked
successful login, the system will prompt you to select the
Questions (FAQs) for shareholders and e-voting User
EVENT i.e., VST Industries Limited.
Manual for shareholders available at the download section
7. On the voting page, enter the number of shares as on of https://evoting.karvy.com or contact M/s. Karvy Fintech
the cut off date under FOR/AGAINST or alternately you Pvt Ltd at Tel No. 1800 345 4001 (toll free).

73
NOTICE OF MEETING
DETAILS OF DIRECTORS SEEKING APPOINTMENT/RE-APPOINTMENT AT THE FORTHCOMING ANNUAL GENERAL MEETING

[Pursuant to Regulation 3 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Clause 1.2.5 of Secretarial Standard-2 on General Meetings]
Name of the Director Mr. Naresh Kumar Sethi Ms. Rama Bijapurkar Mr. Sudip Bandyopadhyay
DIN 08296486 00001835 00007382
Age 53 years 62 years 55 years
Date of first appointment on the Board 14.12.2018 1.4.2019 1.6.2019
Qualifications - Chemical Engineer from IIT - B.Sc (Hons) in Physics from Delhi Chartered Accountant and Cost
Varanasi University Accountant. A gold medalist from Calcutta
- MBA from IIM Calcutta - PGDM from IIM, Ahmedabad University.
Number of Meetings of the Board attended 2 NA NA
during the year
List of Directorships of other Indian Nil 1. Nestle India Limited 1. InditradeRobocash Private Limited
companies 2. Emami Limited 2. Inditrade Housing Finance Limited
3. Inditrade Community Foundation
3. ICICI Bank Limited
4. Inditrade Microfinance Ltd.
4. Mahindra and Mahindra Financial 5. JRG Fincorp Limited
Services Limited 6. Securevalue India Limited
5. National Payments Corporation of 7. Totalstart Entrepreneurship Ecosystem
India Developers
6. People Research on India’s 8. Wall Street Finance Limited
Consumer Economy 9. AGS Transact Technologies Limited
10. India Transact Services Limited
List of Memberships/Chairmanships of Nil Nestle India Limited Inditrade Microfinance Limited
Committees of other Board Stakeholders Relationship Asset Liability Management Committee-
Committee-Chairperson Member
CSR Committee-Member JRG Fincorp Limited
Mahindra and Mahindra Financial Audit Committee-Member
Services Limited Nomination & Remuneration Committee-
Risk Management Committee- Member
Member CSR Committee-Member
Audit Committee-Member Omaxe Limited
Stakeholders Relationship Committee Audit Committee-Member
- Chairperson Nomination & Remuneration Committee
CSR Committee-Member – Chairman
National Payments Corporation of CSR Committee-Member
India Investor Grievances cum Stakeholders
Business Strategy Committee- Relationship Committee – Chairman
Chairperson Securevalue India Limited
Audit Committee-Member
CSR Committee-Member
Nomination & Remuneration Committee-
ICCI Bank Limited Member
CSR Committee-Member CSR Committee-Member
Wall Street Finance Limited
Audit Committee-Member
Share Transfer cum Stakeholders
Relationship Committee – Member
Compensation cum Nomination and
Remuneration Committee – Member
CSR Committee-Member
AGS Transact Technologies Limited
Audit Committee-Chairman
Member
Stakeholders Relationship Committee –
Chairman
IPO Committee – Chairman
Management Committee-Member
India Transact Services Limited
Audit Committee – Chairman
Member
Management Committee-Member
12
NOTICE OF MEETING
Name of the Director Mr. Rajiv Gulati Mr. S. Thirumalai Mr. Devraj Lahiri
DIN 06820663 00011899 03588071
Age 62 years 70 years 46 years
Date of first appointment on the Board 26.7.2019 20.10.2005 1.11.2011
Qualifications - Masters in Pharmaceutical - Law Graduate - Commerce graduate from St. Xavier’s
Technology from IIT Varanasi College, Kolkata
- Fellow Member of the Institute of
- MBA from IIM, Ahmedabad. Chartered Accountants of India, - MBA from Indian Institute of Social
Institute of Company Secretaries of Welfare and Business Management,
India Kolkata
- Certified Associate of Indian Institute
of Bankers
- Attended Advanced Management
Program at Harvard Business
School, Boston, USA
Number of Meetings of the Board attended NA 8 8
during the year
List of Directorships of other Indian 1. Eliph Nutrition Pvt. Limited Nil The Tobacco Institute of India
companies
2. Vedic Herbonatics Pvt. Limited
List of Memberships/ Chairmanships of Nil Nil Nil
Committees of other Board

73
NOTICE OF MEETING
14
REPORT OF THE BOARD OF DIRECTORS & MANAGEMENT
DISCUSSION AND ANALYSIS FOR THE YEAR ENDED 31ST MARCH, 2019
The Directors of your Company have pleasure in presenting before you the directly by the employees of the
Annual Report together with the Audited Statements of Accounts for the year Company as the provisions of the said
ended 31st March, 2019. Section are not applicable.
Financial Summary (` Lakhs) MANAGEMENT DISCUSSION &

ANALYSIS REPORT (MD&A)
2018-19 2017-18
Revenue from Operations 122301 138326 Based on feedback from shareholders
Profit after Tax 22684 18189 on the Annual Report and Accounts,
this report includes MD&A as
Retained earnings brought forward from previous year 32358 29008
appropriate so that duplication and
Balance available for Appropriation 55042 47197
overlap between the Directors’ Report
Amount transferred to General Reserves 2250 900
and a separate MD&A is avoided and
Dividend paid 11967 11581 the entire material with Company’s
Corporate Dividend Taxthereon 2460 2358 state of affairs is provided in a
Balance in retained earnings 38365 32358 composite and comprehensive
document.
KEY RATIOS
Earnings Per Share (`) 146.90 117.79 INDUSTRY STRUCTURE &
DEVELOPMENT
Dividend Per Share (`) 77.50 75.00
After a sustained period of volume
• Value creation during the decade has been Compounded decline, industry witnessed a recovery
Annual Growth Rate (CAGR), 13.8% in Earnings Per Share in 2018-19 post GST stabilization.
(EPS) and 10.0% in Dividend Per Share (DPS).
However, exponential tax hikes in the
DIVIDEND AND TRANSFER TO MATERIAL CHANGES AND previous years have significantly
GENERAL RESERVE COMMITMENTS increased the gap between legal and
non-duty paid cigarettes. This price
The Directors are pleased to Except as disclosed elsewhere in the
distortion has had a severe adverse
recommend a dividend of ` 95/- per Report, there have been no material
impact on legal players.
equity share of `10/- each on the paid changes and commitments made
up equity share capital of the Company, between the end of the financial year Your company continues to engage
for consideration and approval of of the Company and the date of this with key stakeholders for evidence
Members at the ensuing Annual Report. There has also been no change based, non-discriminatory taxation and
General Meeting (AGM). It is proposed in the nature of business of the regulations that safeguard livelihoods
to carry forward an amount of ` 2250 Company during the year. and legal industry, while balancing
lakhs to General Reserve. economic interests and tobacco control
SHARE CAPITAL measures.
Pursuant to Regulation 43A of the SEBI
The paid up Equity Share Capital as COMPANY PERFORMANCE
(Listing Obligations and Disclosure
on 31st March, 2019 was ` 1544.19
Requirements) Regulations, 2015, In 2018-19, your Company registered
lakhs. The Company has neither issued
(hereinafter referred to as the 'Listing an impressive performance with growth
shares with differential rights as to
Regulations') the Company adopted a in both volume and value terms. In the
dividend, voting or otherwise nor issued
Dividend Distribution Policy in terms of process, your Company has
shares (including sweat equity shares)
the requirement which is annexed to strengthened its market position basis
to the employees or Directors of the
this report as Annexure C. The Policy performance of key trademarks and
Company, under any Scheme.
is available on the Company’s website increased geographic footprint.
at http://www.vsthyd.com/i/Dividend- No disclosure is required under Section Your Company’s strategy of portfolio
Distribution-Policy.pdf and forms a part 67(3)(c) of Companies Act, 2013 in expansion through new age brands,
of this Report. respect of voting rights not exercised Editions and Total, has resulted in

73
REPORT OF THE BOARD OF DIRECTORS
significant volume growth in existing Specific Nitrosamines) that are well continues to focus on talent
and new markets. Heritage brands within international standards. development by sharpening their skills
such as Red Charms and Red Special & managerial competencies for current
As part of commitment to Social and
continue to deliver strong performance and future roles. Various initiatives in
Economic upliftment of Companies’
in respective markets. this regard have been taken.
tobacco growing area, your Company
Your Company remains committed to Sustainable and profitable growth can
has great pride in sponsoring the
nurture and develop a vibrant brand only be achieved by putting in place a
initiatives like House Hold Toilets and
portfolio appealing to consumers performance oriented culture and
Solar street lighting with an aim to
across socio economic strata in various highly engaged workplace for the
ensure higher standard of living. Five
geographies. It is also your Company’s employees. Focused efforts are put in
villages were declared open defecation
ongoing endeavor to further strengthen this regard, to empower individuals
free and efforts are on for bringing
its presence in existing markets and realize their potential.
more villages into this fold.
enter new geographies through Your Company has worked on
PRODUCTION AND PLANT
continued investments in distribution engagement strategy initiatives at
MODERNISATION
infrastructure and robust trade multiple levels to motivate & engage
relationships. Your Company continues to give the employees. In this regard, your
competitive edge to its products in the Company has implemented
LEAF TOBACCO
market place, by offering innovative organization wide intervention like
Your Company’s leaf function has products to consumers, which have conducting an Employee Engagement
registered another year of strong been well received. The focus at the survey, which captures the opinions and
performance. Your Company has plants has been to enhance capital perception of employees on critical
procured quality tobaccos for own efficiencies and cost optimization. workplace factors. The Employee
manufacturing and is continuing
Engagement score was at par with the
domestic sales in addition to exports, RESEARCH & DEVELOPMENT
best in class score in the Industry.
by leveraging its expertise in all varieties ACTIVITY
of tobaccos. As on 31st March, 2019, your
Your Company continued to focus on
Company ’s workforce was 782
The focus is on the development of new R&D activity, by way of developing
employees, with 345 Management staff
varieties and high nicotine tobaccos in blends with innovative variants for new
and 437 Workmen.
view of the changing requirements of brands, which have been well accepted
tobacco in the international market with by consumers in market place. Your Company has constituted an
established customers. Internal Complaints Committee as per
The R&D lab of your Company received
In the backdrop of changing climatic the Sexual Harassment of Women at
“Certificate of continuation” of ISO
conditions, wherein farming Workplace (Prevention, Prohibition and
17025:2005, from NABL, Quality
community is unable to realize their Redressal) Act, 2013 and the Rules
Council of India, Govt. of India, for the
investment in agriculture, your framed there under. No cases were
year 2018-19.
Company is keeping the farmers’ filed during the year under the above
HUMAN RESOURCE Act.
interest at high level continuously to
DEVELOPMENT
sustain the tobacco cultivation. This ENVIRONMENT, HEALTH &
also has helped to develop backward Your Company’s Human Resource SAFETY (EHS) AND COMMUNITY
regions of growing area. Management focus continues to attract SERVICES
It is satisfying to note that your and retain the best talent, in an
305 employees and 23 contractors and
Company's farmers continue to grow increasingly competitive market place.
contract workmen have undergone
tobacco with the lowest pesticide VST recognizes people as the primary EHS training and 156 employees and
residue levels and low TSNAs (Tobacco source of its competitiveness and 30 contract workmen have undergone
16
firefighting training. Mock drills were Company and efficient utilization of the The details of the dividend due for
also conducted for workers and shareholder resources. transfer to IEPF as on 31st March, 2019
management during the period to is given in the Report on Corporate
PARTICULARS OF LOANS,
comply with the Company ’s EHS Governance. The Company has
GUARANTEES OR INVESTMENTS
guidelines. completed the process of complying
The Company has not taken any loans with the provisions of Section 124(6)
Quarterly and Annual EHS audits of the
or given guarantees or made of the Companies Act, 2013 read with
Company’s operations were carried
investments in any other Company as the IEPF Authority (Accounting, Audit,
out to ensure compliance of EHS
prescribed under Section 186 of the Transfer and Refund) Rules, 2016 the
requirements. ISO 14001:2015 &
Companies Act, 2013 during the year. IEPF Authority (Accounting, Audit,
OHSAS 18001:2007 surveillance
Transfer and Refund) Second
Audit was held at Azamabad & Toopran
RATING Amendment Rules, 2017 by
premises by M/s.Rina India Pvt. Ltd.
transferring 10,640 shares (118
and received continuation certificate for The Credit Rating Information Services
shareholders) on 12th October, 2018.
ISO 14001:2015 & OHSAS India Limited (CRISIL) has re-
18001:2007 for both premises, at affirmed the rating of your Company UNCLAIMED SHARE
Azamabad & Toopran. to “FAAA/Stable” for Fixed Deposit CERTIFICATES
Schemes, “AA+/Stable” for Long Term Your Company has communicated to
Your Company received “Safety
Non-convertible Debentures and the Members whose share certificates
Innovation Award 2018” from Institute
“A1+” for Non-fund based liabilities have been returned undelivered to the
of Engineers, New Delhi.
(Letter of Credit and Bank Guarantee). Company that these would be
CFO Renewal received for Azamabad Your Company has stopped accepting transferred to the Unclaimed Suspense
factory was from TSPCB for the period fresh deposits for the past several years. Account if not claimed by them, as
of 5 years - 2018 to 2023.
UNCLAIMED DIVIDENDS required under Regulation 34(3) read
FINANCE with Schedule V[F] of the Listing
Pursuant to the provisions of Sections Regulations as amended.
a. Profits
124 and 125 of the Companies Act,
The status of unclaimed shares as on
The Profit after Tax of your Company 2013, the Company has transferred on
31st March, 2019 is given in the Report
for the year is ` 226.8 crores. due dates, the unpaid or unclaimed
on Corporate Governance.
b. Treasury Operations dividends for the financial year ended
31st March, 2011 to the Investor CORPORATE GOVERNANCE
Your Company follows a SLR model Education and Protection Fund
(Safety, Liquidity and Return) in In terms of Regulation 34 of the Listing
(IEPF) established by the Central Regulations, a Report on Corporate
deployment of earmarked funds.
Government. Governance along with Compliance
There are no significant changes
Further as per the provisions of Investor Certificate issued by the Statutory
(change of 25% or more as compared
Education and Protection Fund Auditor's of the Company is annexed
to the immediately previous financial
(Uploading of Information regarding as “Annexure A” and forms part of
year) in the key financial ratios of the
unpaid and unclaimed amounts lying this Report.
Company including those listed out and
specified under Schedule V (B)(1)(i) with Companies) Rules, 2012, the Your Company has taken adequate
read with Regulation 34(3) of the Listing Company has uploaded the details of steps for strict compliance with the
Regulations as amended. unpaid and unclaimed amounts lying Corporate Governance guidelines, as
There has been a positive change to with the Company as on 31st March, amended from time to time.
the Return on Net worth by about 9.3 2018 on the website of the Company
MEETINGS
percentage points as compared to the (www.vsthyd.com), and also on the
previous year primarily due to website of the Ministry of Corporate The Board and Committee meetings
improved performance of the Affairs, Government of India. are pre-scheduled and a tentative

73
calendar of the meetings finalized in areas and come up with a eliminating these risks, the decision
consultation of the Directors are comprehensive risk mitigation plan. making process at your Company
circulated to them in advance to considers sensible risk taking, and
The Audit Committee of your Board met
facilitate them to plan their schedule. thereby proactive steps are taken to
six times during the year. Review of
ensure that business is undertaken in
However, in case of special and urgent audit observations covering the
an environment which encourages a
business needs, the approval is operations, consideration of accounts
reasonable amount of risk taking and
obtained by way of circular resolution. on a quarterly basis and monitoring
enables the Company to leverage
During the year eight Board Meetings the implementation of audit
market opportunities effectively.
and six Audit Committee Meetings were recommendations were some of the
convened and held. The details of the key areas which were dealt with by the The Board is responsible for
meetings including composition of Committee. The Statutory Auditors/ determining the nature and extent of
Audit Committee are given in the Internal Auditors were invited to attend the principal risks that your Company
Corporate Governance Report. During the Audit Committee meetings and is willing to take to achieve its strategic
the year, all the recommendations of make presentations covering their objectives and for maintaining sound
the Audit Committee were accepted by observation on adequacy of internal risk management system. With the
the Board. financial controls and the steps support of the Audit Committee, it
required to bridge gaps, if any. Chief carries out a review of the effectiveness
INTERNAL CONTROL SYSTEMS of your Company’s risk management
Financial Officer is a permanent invitee
a. Your Company maintains an to the Audit Committee and other process covering all material risks
adequate and effective internal executives of the Company are invited including strategic, financial,
control system commensurate with to address, respond or provide operational and also compliance
the size and complexity. Your clarifications to relevant issues and levels.
Company also has well when required. Your Company has substantial
documented Standard Operating Risk Management operations all over the country and
Procedures (SOPs) for various competes on the basis of brand appeal,
processes which are periodically During the year, your Company has
loyalty, price value connotations and
reviewed for changes warranted constituted the Risk Management
strong trade relationships. The
due to business needs. Committee as mandated by SEBI for
Company’s position is influenced by
top 500 listed entities which was to be
b. Your Company remains committed the economic, regulatory and political
effective from 1st April, 2019. The
to improve effectiveness of internal situations both nationally and at a state
Committee comprises of Directors and
financial controls and processes level and of the competitors. The
Senior Management as its Members as
which would help in efficient principal risks impacting your
prescribed under Regulation 21 of the
Company ’s business and steps
conduct of its business operations, Listing Regulations as amended. The
undertaken to mitigate them are as
ensure security to its assets and Company Secretary will be the
under:
timely preparation of reliable Secretary of the Committee.
financial information. (i) Regulatory restrictions could
Your Company has always endeavored
have an impact on long term
The policies and procedures laid out to bring together elements of best
revenue growth of the Company.
by your Company capture the control practices for risk management in
environment prevalent in the relation to existing and emerging risks The Company operates under
organization. Over a period of three faced by it at both strategic and increasingly stringent regulatory
years, the business processes of your operating level. The Company faces a regime (COTPA guidelines on
Company is reviewed through an variety of risks from external and packaging and labeling,
internal audit process which reviews the internal sources. However, the objective advertising and promotion) This
systems on a continuous basis. The is to be aware of different kinds of risks further gets complicated with
objective being to identify potential risk affecting the business. Rather than adoption of differing regulatory
18
regimes in different states and/or including new brand creation; and information, or its disclosure to
lack of consensus on (c) capability build-up through outsiders, including competitors
interpretation/application. investments in distribution and trading partners, could
infrastructure to increase potentially have a significant
Such restrictive regulations which
geographical spread. adverse impact on the Company’s
are subjected to interpretation
could result in not only penalties (iii) Regional disruptions could business operations and/or give
being imposed/loss of reputation, have an impact on short-term rise to legal liability. For this
but also impair the Company’s revenue growth of the Company as purpose, the Company has put in
ability to communicate with adult well as reputation. place information technology
smokers and/or to meet consumer Regional disturbances through policies and procedures which are
expectations through new/ state level restriction on trade or reviewed regularly. Further,
innovative brand launches or through terrorism and political information technology controls
geographic expansion. violence including bandhs, strikes, like data back-up mechanism,
have the potential to disrupt the disaster recovery center,
The Company addresses this risk
Company’s business operations. authorization verification, etc. have
by engaging in continuous social
Such disruptions result in potential also been established.
dialogue with stakeholders and
regulatory community through loss of assets and increased costs CORPORATE SOCIAL
industry bodies. At the same time, due to more complex supply chain RESPONSIBILITY INITIATIVES
arrangements and/or maintaining
it works on developing strategies Your Company has formulated a
inefficient facilities.
and capabilities to effectively Corporate Social Responsibility Policy
launch competitive and consumer The Company addresses this risk
with the objective to promote inclusive
acceptable brands within the through developing secure multiple
growth and equitable development of
changing regulatory environment. sourcing/delivery (supply chain)
identified areas by contributing back
strategy and through Insurance
(ii) Taxation changes could have an to the society. Over the years, your
cover and business continuity
impact on short-term revenue Company has been involved in various
planning.
growth of the Company. social activities focusing on Health &
(iv) Counter party risk could have Sanitation like construction of toilets
The Company ’s business is a potential impact on Company's under Swachh Ghar mission, etc.
subjected to GST, excise and other capital and profitability.
cesses as may be made applicable, The Company has with the help of
The Company generates positive Gramalaya, a non-profit organization
which could require the Company
cash flows which are constructed toilets in individual homes
to take up product prices and in
predominantly invested with (of farmers living) in and around
absence of such action, impact its
financial institutions and mutual Jogulamba and Gadwal districts of
business. The impact increases
funds. Delay and/or default in Telangana where your Company has
when due to changes in economic
settlement on maturity of such its operations, under the ‘Swachh
situation, consumer’s disposal
investments could result in liquidity Ghar’ program of your Company. In
income reduces, resulting in down-
and financial loss to Company. addition to construction of toilets, the
trading to cheaper cigarettes or
Such risks are mitigated through villages and the communities in the
alternative tobacco products.
investment based on principle of area are also sensitized about the
Such risks are addressed by the Safety; Liquidity & Returns (SLR) and importance of health & sanitation. Over
Company through: (a) with institutions having strong 800 toilets have already been
engagement with tax authorities at short-term and long-term ratings constructed during the financial year
levels where appropriate; (b) assigned by CRISIL. and your Company has plans to extend
regular management review to it further to other houses in the same
build a well laddered brand (v) Data risks
area and thereafter extend it to other
portfolio across new segments The loss or misuse of sensitive areas.

73
Your Company has taken up initiative RELATED PARTY TRANSACTIONS Key Managerial Personnel and other
of installing 30,000 tree guards in the employees which has been revised and
GHMC region (Haritha Haram project, The related party transactions entered approved by the Board. The
by Govt. of Telangana). Also supporting into by the Company during the year Remuneration Policy and the criteria for
environment sustainability, your are in its ordinary course of business determining qualification, position
Company has also taken up the and on an arm’s length basis. There attributes and independence of a
identified project of installing 300 solar were no materially significant related director are stated in the Corporate
street lights in villages in Adilabad, party transactions between your Governance Report. The policy is also
Gadwal and Nizamabad districts of Company and the Directors, placed on the website of the Company
Telangana. Promoters, Key Managerial Personnel and can be viewed at http://
and other designated persons which w w w. v s t h y d . c o m / d o c u m e n t s /
In the field of Education, your Company
may have a potential conflict with the remuneration-policy.pdf.
had provided mid-day meals for more
interest of your Company at large. Prior MEETING OF INDEPENDENT
than 9000 Government school children
approval for all the related party DIRECTORS
& Anganwadi children in Medak region
transactions is obtained from the Audit
this financial year. Your Company The performance of the Non-Executive
Committee.
provided necessary school Director, the Chairman and the Board
infrastructure like benches in Form AOC-2 for disclosure of as a whole is done by the Board and
Musheerabad area, 650 benches were particulars of contracts/arrangements, the Independent Directors in their
given to the schools. entered into by your Company with exclusive meeting as per the policy
related parties is annexed herewith as formulated by the Board in this regard.
Pursuant to the provisions of Section
“Annexure D” and forms part of this In addition, the Independent Directors
135 and Schedule VII of the
Companies Act, 2013, the Corporate Report. in such meeting also review their role,
Social Responsibility (CSR) Committee BOARD EVALUATION functions and duties under the
of the Board of Directors was formed Companies Act, 2013 and the flow of
Pursuant to the provisions of the information from the management.
to recommend the policy on Corporate
Companies Act, 2013 as amended
Social Responsibility and monitor its VIGIL MECHANISM
implementation. The composition of and Listing Regulations, the
performance evaluation of the Board, In terms of Section 177 of the
the CSR Committee is given in the
the Committees of the Board and Companies Act, 2013, the Company
Annual Report on the CSR activities. The
individual Directors has been carried has formulated a Whistle Blower Policy
CSR policy is available on the
out. The manner in which the as a vigil mechanism to encourage all
Company ’s website at :
evaluation has been carried out has employees and directors to report any
www.vsthyd.com/i/CSRPolicy.pdf.
been explained in the Corporate unethical behavior, actual or suspected
The CSR Policy and the Annual Report Governance Report. fraud or violation of the Company’s
on CSR activities is annexed herewith ‘Code of Conduct and Ethics Policy’
as “Annexure B” and forms part of The performance evaluation of the which also provides for adequate
this Report. Chairman and the Non-independent safeguard against victimization of
Directors was carried out by the person who use such mechanism and
BUSINESS RESPONSIBILITY Independent Directors and Non- there is a provision for direct access to
REPORT Executive Directors. The Board of the chairman of the Audit Committee
The Listing Regulations mandates Directors expressed their satisfaction in appropriate/exceptional cases. The
inclusion of Business Responsibility with the evaluation process. details of the Whistle Blower Policy is
Report (BRR) as part of the Annual given in the Corporate Governance
REMUNERATION POLICY
Report for top 500 listed entities based Report and also posted on the
on market capitalization. In compliance Nomination & Remuneration Company ’s website at:
with the Regulation, the BRR is provided Committee has formulated a policy www.vsthyd.com/i/WhistleBlower
as part of this Annual Report. relating to remuneration of Directors, Policy.pdf.
20
DIRECTORS AND KEY Meeting held on 12th March, 2019 on amended and Regulation 25 of the
MANAGERIAL PERSONNEL the recommendation of Nomination & Listing Regulations as amended for the
Remuneration Committee appointed financial year ended 31st March, 2019
Directors’ Resignation/ Ms. Rama Bijapurkar as an Additional that they meet the criteria of
Appointment
(Independent) Director of the Company independence. They also declared that
Mr. Pradeep V. Bhide in accordance with Section 149 of the they are not aware of any circumstance
Mr. Pradeep V Bhide resigned as Companies Act, 2013, with effect from or situation, which exist or may be
Director and Chairman of your 1st April, 2019 to hold the office for a reasonably anticipated, that could
Company to be effective from the 1st term of five consecutive years. impair or impact their ability to
of July, 2019, being the date of receipt discharge their duties as an
Mr. Sudip Bandyopadhyay
of the resignation letter. The Board of Independent Director with an objective
The Board of Directors, on the independent judgment and without any
Directors place on record their deep
recommendation of the Nomination & external influence. The Board carried
appreciation of the contribution made
Remuneration Committee, at their out an assessment of the declarations
to your Company by Mr. Pradeep V
Meeting held on 3rd May, 2019 and took the same on record.
Bhide during his tenure as a Director.
appointed Mr. Sudip Bandyopadhyay
Mr. Ramakrishna V. Addanki None of the Independent Directors are
as an Additional (Independent) Director
related to any other director of the
Mr. Ramakrishna V. Addanki resigned of the Company in accordance with
Company.
as Non-Executive Director of your Section 149 of the Companies Act,
Company with effect from 14th 2013, with effect from 1st June, 2019 Directors retiring by rotation
December, 2018. The Board of to hold office for a term of five
Mr. S. Thirumalai
Directors place on record their deep consecutive years, subject to the
approval of the Members. Mr. S. Thirumalai, was appointed as an
appreciation of the contribution made
Independent Director of the Company
to your Company by Mr. Ramakrishna Mr. Rajiv Gulati with effect from 1st October, 2014 for
V. Addanki.
Further, subject to the Members’ a period of 5 years. He has been
Mr. Naresh Kumar Sethi approval, the Board of Directors on the reclassified as a Non-Executive Non-
recommendation of the Nomination & Independent Director in compliance
The Board of Directors of your
Remuneration Committee, at their with Section 152 (6) read with Schedule
Company at their Meeting held on
Meeting held on 26th July, 2019 IV of the Companies Act, 2013 as
14th December, 2018, on the
appointed Mr. Rajiv Gulati as an amended at a Meeting of the Board of
recommendation of Nomination &
Additional (Independent) Director of the Directors held on 26th July, 2019,
Remuneration Committee, appointed
Company in accordance with Section whose office is subject to retirement by
Mr. Naresh Kumar Sethi as a Non-
149 of the Companies Act, 2013, with rotation.
Executive Director of the Company, in
place of Mr. Ramakrishna V. Addanki effect from 26th July, 2019 to hold Pursuant to Article 93 of the Articles of
with effect from 14th December, 2018 office for a term of five consecutive Association of your Company, Mr. S.
i.e, in the casual vacancy resulted, years. Thirumalai is liable to retire from the
which is subject to the approval of the Board and being eligible, offers himself
Apart from the above, Ms. Mubeen
Members at the ensuing Annual for re-election. Your Board
Rafat, was appointed as an
recommends his re-appointment.
General Meeting. Independent Director of the Company
at the Annual General Meeting held on Mr. Thirumalai is not a Director in any
Independent Directors
12th August, 2014 for a period of five other Company in India. He is a
Ms. Rama Bijapurkar years. Member of the Audit Committee, CSR
Committee, Stakeholders Relationship
During the year under review, subject All the Independent Directors have Committee, Risk Management
to the Members’ approval, the Board given a declaration in terms of Section Committee and Nomination &
of Directors of your Company at their 149(6) of the Companies Act, 2013 as Remuneration Committee. Mr.

73
Thirumalai holds 25 shares in the 3. proper and sufficient care has been • Existing composition of the Board.
Company and is not related to any taken for the maintenance of
The qualification of the candidate is
other Director of the Company. adequate accounting records in
scrutinized by the Committee taking
The Board of Directors of your accordance with the provisions of
into account educational degree,
Company approved the Directors' the Companies Act, 2013 for
college/institution, professional
Report along with the Audited Accounts safeguarding the assets of your
qualification if any, etc. In addition,
of the Company on 3rd May, 2019. In Company and for preventing and
there is also a criteria regarding
order to reflect the above changes to detecting fraud and other
minimum work experience and the
the composition of the Board which irregularities;
positive attributes such as leadership
occurred after 3rd May, 2019, the 4. the annual accounts have been quality, level of maturity, management
amended Directors' Report has been prepared on a going concern capabilities, strategic vision, problem
approved by the Board of Directors at basis. solving abilities, etc., on which the
its Meeting held on 26th July, 2019. candidate is judicially scrutinized.
5. proper internal financial controls
Key Managerial Personnel have been laid down to be followed In case of an internal candidate, the
The Managing Director Mr. Devraj by your Company and such senior management employee is also
Lahiri, the Chief Financial Officer internal financial controls are evaluated on the above criteria before
Mr. Anish Gupta and the Company adequate and were operating being recommended for promotion as
Secretary Mr. Phani K. Mangipudi are effectively; and a Director. While considering re-
the Key Managerial Personnel as per 6. proper systems to ensure appointment of the Directors, their
the provision of the Companies Act, compliance with the provisions of performance evaluation report is taken
2013. all applicable laws have been into account.
DIRECTORS’ RESPONSIBILITY devised, and such systems were
In case of Independent Director, the
STATEMENT adequate and operating effectively.
independence, integrity, expertise,
Criteria for selection and experience and interest pecuniary or
Pursuant to Section 134(5) of the
Companies Act, 2013 your Directors appointment of directors otherwise as per the statutory provisions
confirm that: are also assessed before appointment.
The Nomination & Remuneration
Committee is responsible for SIGNIFICANT & MATERIAL
1. in the preparation of the annual
identifying, screening, recommending ORDERS PASSED BY THE
accounts, the applicable
accounting standards have been to the Board a candidate for REGULATORS OR COURTS OR
followed along with proper appointment as Director. Based on the TRIBUNALS
explanation relating to material recommendation of the Committee, the
There are no significant or material
departures, if any; Board identifies the candidate for the
orders passed by the Regulators, Courts
position of Director. While identifying
or Tribunals which impact the going
2. appropriate accounting policies the candidate, inter alia the following
have been selected and applied concern status of the Company and its
are taken into consideration :
consistently. Judgement and future operations. However, Members’
• Qualification, experience and attention is drawn to the following :
estimates which are reasonable
expertise;
and prudent have been made so TAXATION
as to give a true and fair view of • Skills, abilities and personal
the state of affairs of your contribution; i. Luxury Tax
Company as on 31st March, 2019 • Commitment to spare time to The Government of AP introduced levy
and of the statement of profit and attend Board/Committee and other of luxury tax on cigarettes and its virus
loss and cash flow of your Meetings as may be necessary; was challenged before the High Court
Company for the period ended • Diversity of perspectives brought to of AP and before Supreme Court which
31st March, 2019; the existing Board; was struck down. The Commercial Tax
22
department claimed that during cause notices demanding recovery of the PIL on the lines that the
pendency of the matter before the duty on cut tobacco used in the Government has to take necessary
courts between 1999-2005, your manufacture of tobacco refuse since steps to build laboratories to check
Company had collected luxury tax January 2005 till June 2017 the tar and nicotine content in the
amounting to ` 34.86 crores but not amounting to `14.52 crores. Demand cigarettes.
paid to the Government. Your for the period till October, 2013 has
ii) Your Company has been
Company denied collecting luxury tax been adjudicated and CESTAT
impleaded in the petition filed in
and litigation on the same is now decided in favour of your Company.
the Supreme Court by an NGO
pending before High Court of Department has preferred an appeal
called ‘Centre for Transforming
Telangana and before the appellate before Supreme Court which is
India’ against the Union of India
authority of the Department. pending. Demands for period after
along with other cigarette
October, 2013 till June, 2017 are yet
ii. Entry Tax manufacturers, Tobacco Institute of
to be adjudicated by the original
India, Bidi Manufacturers and Bidi
Entry Tax levy by the States of Bihar, authority.
Manufacturers’ Association seeking
West Bengal, Jharkhand and Assam
c. Service Tax prohibition/ban on the
has been challenged before the
manufacture, storage and sale of
respective State High Courts by your Your Company has received show
all forms of tobacco within the
Company, basis the directions of the cause notices from the Excise
territory of India.
Hon’ble Supreme Court. Demand of Department seeking to deny CENVAT
interest on entry tax was challenged credit availed on various input services iii) A PIL was filed before the
before the High Court of Allahabad on the ground that the same are not Uttarakhand High Court in India
and on appeal to the Supreme Court. in relation to the manufacture of final relating to printing of Tar-Nic
The Hon’ble Supreme Court granted a products. Upon adjudication, credit contents on cigarette packets. The
stay against recovery of interest on entry on most of the services was allowed High Court passed an Order
tax. in favor of your Company. Some of allowing the petition and directing
them have been disputed. Since ban on sale of loose cigarettes
iii. Excise
2005, the matters are pending before without printing health warning.
a. Wrapping Materials various adjudicating authorities and The Court has also ordered ban on
before CESTAT and are being sale of cigarettes in the state of
The Excise department has issued show
contested. Uttarakhand if the union does not
cause notices demanding payment of
duty of ` 4.51 crores on the ground prescribe safe or maximum
PUBLIC INTEREST LITIGATION
that Gay Wrappers (printed paper used permissible limit of nicotine & tar
(PIL)
for wrapping cigarette packets) had contents in each cigarettes or label
been manufactured and consumed by i] The two PILs filed in the Madras or package.
your Company without payment of duty High Court and the Andhra
A review petition has been filed by
during the period April 1996 to July Pradesh High Court against the
your Company along with others
2015. Demand for the period till March Central Government and the
against the order and it was
2002 has been adjudicated and cigarette manufacturers including
disposed off by the High Court of
CESTAT decided in favour of your your Company, seeking strict
Uttarakhand in favour of your
Company. Department has preferred implementation of Cigarettes and
Company.
an appeal before Supreme Court which Other Tobacco Products
(Prohibition of Advertisement And Petitions have also been filed in
is pending. Demands for period after
Regulation of Trade and other courts such as : High Court
March, 2002 till July, 2015 are yet to
Commerce, Production, Supply of Jabalpur, National Green
be adjudicated by the original authority.
and Distribution) Act, 2003 (COTP Tribunal, Delhi, seeking a ban on
b. Tobacco Refuse Act) and Rules are pending. The sale of cigarettes; before High
Your Company has received show Madras High Court disposed off Court of Madhya Pradesh, Indore

73
Bench seeking directions to THE CIGARETTES AND OTHER said writ petition has been admitted
mention tar and nicotine content TOBACCO PRODUCTS but no interim orders were passed
on cigarette packs by the (PROHIBITION OF by the Hon’ble Court.
manufacturers and a PIL before the ADVERTISEMENT AND (iii) Before the High Court of
High Court of Mumbai seeking REGULATION OF TRADE AND Karnataka, a Writ Petition was filed
directions that the Insurance COMMERCE , PRODUCTION, by Tobacco Institute of India (TII)
Companies shall not invest in the SUPPLY AND DISTRIBUTION) on behalf of your Company and
cigarette companies. ACT, 2003 (COTPA) other manufacturers against the
All of the above are being effectively (i) In view of the provisions of COTPA proposed notification dated 15th
contested by your Company. various restrictions such as ban on October, 2014 by Health Ministry
advertising in print and visual to print health warning on both
FINANCIAL SERVICES BUSINESS sides of the pack occupying 85%
media, ban on outdoor advertising,
regulation of in-store advertising, of space. The 85% health warning
The Company Petition filed by the
prohibition of sale of cigarettes to came into effect from 1st April,
Official Liquidator in the Hon’ble High
persons below the age of 18 years, 2016. Your Company also filed a
Court of Andhra Pradesh seeking
etc. have been in force. Printing of Writ Petition before the High Court
directions against some of the Ex-
pictorial warnings on cigarette bench at Dharwad against the
Directors of ITC Agro Tech Finance and
packets, which came into effect implementation of 85% health
Investments Limited (ITCATF), the warning. The Hon’ble Supreme
Company in liquidation, into which one from 31st May, 2009 were further
revised with effect from 1st Court on hearing a PIL filed by
of the subsidiaries of your Company, Health for Millions, constituted a
viz. VST Investments Limited was December, 2011 and 1st April,
2013. In October, 2014 the Bench before the Karnataka High
amalgamated, to file a Statement of Court to hear all the matters
Government notified a new set of
Affairs is still pending. relating to graphical health
pictorial warning covering 85% of
the front and back side of the warning. The Writ Petitions filed by
In terms of the Order dated 10th July,
packets with effect from 1st April, TII and your Company are being
2007 the Division Bench of the Hon’ble
2015. However, after extension, the heard before the Bangalore Bench.
High Court of Andhra Pradesh had
same have now been implemented The Bench continuously heard the
directed the Regional Director,
from 1st April, 2016 and is being matters till 28th February, 2017
Department of Corporate Affairs,
duly complied with by your and the Karnataka Bench held on
Chennai to conduct an investigation
Company. 15th December 2017 that the
and submit a report showing the
amendment made to the
persons who promoted ITCATF and the (ii) Your Company had also filed a writ Packaging Rules imposing 85%
persons who were responsible in petition in the Hon’ble High Court graphic health warning is ultra vires
conducting its affairs until its winding of Andhra Pradesh challenging The the Constitution. Against the said
up. A comprehensive report was Cigarettes and Other Tobacco Judgment, the aggrieved parties
prepared and filed in the Court by the Products (Packaging & Labelling) filed SLP before the Supreme Court
Regional Director in July 2008. Further, Rules, 2006 and the Amendment seeking stay and the same was
the Division bench, against the appeal Rules 2008, on the grounds inter granted.
filed by one of the Ex-Directors of alia that they are ultra vires of
ITCATF, remanded the matter to the COTPA and therefore the REAL ESTATE
Company Judge to decide afresh notifications issued there under The Government of Andhra Pradesh
keeping in view the report submitted (including those seeking had filed a land grabbing case against
by the Regional Director. All the matters implementation of graphic health your Company in 1991 in relation to
are still pending final adjudication. warnings) should be quashed. The a piece and parcel of vacant land which
24
has been under possession and construct commercial building on the Your Directors take this opportunity to
occupation by your Company for over said land. Judgment was pronounced record their deep appreciation of the
four decades. By its judgement dated on the vacate stay petition allowing continuous support and contribution
28th July, 2010, the Special Court had your Company to construct building but from all employees of your Company.
held that your Company is not a land with certain conditions. The State
ANNUAL RETURN
grabber but had given the State Government preferred an appeal
Government the right to initiate before the Supreme Court which was As required under Section 92(3) of
proceedings to recover possession of dismissed. Companies Act, 2013 and Rule 12(1)of
the land at some future date. Against Companies (Management and
this part of the judgement, your PARTICULARS OF EMPLOYEES
Administration) Rules, 2014, an extract
Company had filed a writ petition in The information required pursuant to of Annual Return in Form MGT-9 is
the Hon’ble High Court of Andhra Section 197 of the Companies Act, annexed as “Annexure F” and forms
Pradesh to expunge that part of the 2013 read with Rule 5(1) of the part of this report.
Order giving such liberty to the Companies (Appointment and
Department despite the fact that your A duly certified and filed copy of the
Remuneration of Managerial
Company has already been declared annual return for the financial year
Personnel) Rules, 2014 in respect of
not to be a land grabber. The writ 2018-19 will be made available on the
employees of the Company, are
petition is still pending. The State website of the Company at
annexed herewith as “Annexure E”
Government has also filed a writ www.vsthyd.com, after the ensuing
and forms part of this Report. The
petition in the Hon’ble High Court of Annual General Meeting.
statement containing particulars of
Andhra Pradesh seeking to set aside employees as required under Section AUDITORS
the said judgement of the Land 197 of the Act read with Rule 5(2) of
Grabbing Court. An interim Order was Companies (Appointment and Statutory Auditors
passed restraining your Company
Remuneration of Managerial
from changing the status of the land In compliance with the provisions of
Personnel) Rules, 2014 is provided in
or creating any third party interest Sections 139 and 141 of the
a separate annexure forming part of
therein. Your Company has taken all Companies Act, 2013 as amended
this Report. However, in terms of
the necessary steps for speedy disposal and Companies (Audit and Audit
Section 136 of the Act, the Report and
of the above writ petitions which are Rules), 2014, including any statutory
Accounts are being sent to the
pending before the Court. modification(s), re-enactments and
Members and others entitled thereto,
amendments thereof, for the time being
One more case of land grabbing was excluding the information on
in force, M/s. B S R & Associates LLP,
filed by the then Government of Andhra employees’ particulars which is
Chartered Accountants, were
Pradesh against your Company in the available for inspection by the
appointed as the Statutory Auditors of
year 1989 on a piece of land along Members at the Registered Office of
with building called ‘Lal-e-Zar’, before the Company to hold office from the
the Company during business hours on
the Special Court and in the year 2010, conclusion of the 85th AGM to the
working days of the Company up to
the Special Court passed a judgment conclusion of the 90th AGM. This was
the date of the ensuing AGM. In case
stating that your Company is not a land subject to the ratification at every AGM
any Member is interested in obtaining
grabber. After 7 years, the State during the aforementioned term of
a copy thereof, such Member may write
Government filed an appeal before the their appointment. However, the
to the Company Secretary of the
Hon’ble High Court of Telangana and requirement of annual ratification has
Company.
Andhra Pradesh seeking a direction been dispensed with under the
from the court that the nature of the The Nomination & Remuneration Companies (Amendment) Act, 2017
land shall not be altered and no third Committee of the Company has which has been notified on 7th May,
party interest to be created. Your affirmed that the remuneration is as per 2018. The Report given by the Auditors
Company filed a counter and vacate the Remuneration Policy of the on the financial statements of the
stay application seeking permission to Company. Company is part of the Annual Report.

73
There has been no qualification, CONSERVATION OF ENERGY, ACKNOWLEDGEMENTS

reservation or adverse remark in their TECHNOLOGY ABSORPTION,
Report. During the year under review, The Directors are grateful to all
FOREIGN EXCHANGE EARNINGS
the Auditors have not reported any valuable stakeholders of the Company
AND OUTGO
matter under Section 143(12) of the viz., customers, shareholders, dealers,
Information in accordance with clause vendors, banks and other business
Companies Act, 2013 and hence, no
(m) of sub-section (3) of Section 134 associates for their excellent support
detail is required to be disclosed under
of the Companies Act, 2013 read with rendered during the year. The Directors
Section 134(3)(ca) of the Companies
Rule 8 of Companies (Accounts) Rules, also acknowledge the unstinted
Act, 2013.
2014 is given in the “Annexure H” commitment and valued contribution
Secretarial Auditor forming part of this Report. of all employees of the Company.
Pursuant to the provisions of Section SUBSIDIARY/ASSOCIATES/JOINT
On behalf of the Board,
204 of the Companies Act, 2013 and VENTURES
Rule 9 of the Companies (Appointment NARESH KUMAR SETHI
Addition or cessation of subsidiaries,
and Remuneration of Managerial Chairman
associates or joint ventures is not
Personnel) Rules, 2014, the Company DIN : 08296486
applicable to the Company, as the
had appointed Dr. K.R. Chandratre, Company does not have any subsidiary Dated this 26th day of July, 2019
Company Secretary in Practice, as company, associates and joint ventures. Azamabad, Hyderabad - 500 020
Secretarial Auditor of the Company
for the financial year 2018-19. The DEPOSITS
Secretarial Audit Report is annexed Your Company has stopped accepting
herewith as “Annexure G” and fresh deposits for several years now.
forms part of this Annual Report. As on 31st March, 2019, your
There are no qualifications, Company does not have any deposits
reservations or adverse remarks in the for the purpose of its business, hence
Secretarial Audit Report. details of deposits is not applicable.
UTILISATION OF FUNDS
COMPLIANCE WITH
SECRETARIAL STANDARDS Your Company has not raised any
funds during the year through
Your Company has complied with
preferential allotment or Qualified
applicable Secretarial standards, i.e.
Institutional Placement, as a result
on Meetings of the Board of Directors
question of providing details of
[SS-1] and on General Meetings [SS-
utilization of such funds does not arise.
2] issued by The Institute of Company
Secretaries of India (ICSI) and DEBENTURE TRUSTEES
approved by the Central Government Your Company does not have any
under Section 118(10) of the debentures and as a result, creation of
Companies Act, 2013. debenture trustees does not arise.
COST ACCOUNTS AND RECORDS THE FUTURE
The maintenance of cost accounts and Despite adverse market conditions,
records, as specified by the Central your Company is well placed to exploit
Government under Section 148(1) of opportunities through innovative new
the Companies Act, 2013 is not brand launches, coupled with
required by the Company. expansion of operational areas.
26
ANNEXURE A
REPORT ON CORPORATE GOVERNANCE
The Directors present the Company’s Report on Corporate Governance for the year ended 31st March, 2019.
1. COMPANY’S PHILOSOPHY ON CORPORATE GOVERNANCE
Your Company considers good Corporate Governance a pre-requisite for meeting the needs and aspirations of its
Members and other stakeholders in the Company. The Board of Directors of your Company firmly believes that the same
could be achieved by maintaining transparency in its dealings, creating robust policies and practices for key processes
and systems with clear accountability, integrity, transparent governance practices and the highest standard of compliance.
2. BOARD OF DIRECTORS
(a) Composition and category of Directors
Name of the Director Category No. of outside No. of memberships/chair-

directorships manships of board committees
held * of other companies #
1
Mr. Raymond S. Noronha Chairman - Non-Executive Director Nil Nil
2
Mr.Pradeep V. Bhide Chairman - Non-Executive Director 6 7
Mr. Devraj Lahiri Managing Director 1 Nil
Mr. S. Thirumalai Independent - Non-Executive Director Nil Nil
Ms. Mubeen Rafat Independent - Non-Executive Director Nil Nil
3$
Mr. Ramakrishna V. Addanki Non-Executive Director Nil Nil
4 $
Mr. Naresh Kumar Sethi Non-Executive Director Nil Nil
Notes: There are no inter-se relationships between the Board members.
Except Mr. S. Thirumalai who holds 25 equity shares none of the other directors hold any shares in the Company. There are
no convertible instruments issued by the Company and hence none held by the Non-Executive Directors during the year
ended 31st March, 2019.
*
Other directorships exclude foreign companies, private limited companies, debt listed and alternate directorships.
#
Only membership in Audit Committee and Stakeholders’ Relationship Committee have been reckoned for other committee
memberships.
$
Representing equity interest of promoter group – British American Tobacco, U.K.
1
Resigned as Director w.e.f. close of business hours on 12th April, 2018.
2
Appointed as Director w.e.f. 12th April, 2018 and as Chairman w.e.f. 28th May, 2018.
3
Resigned as Director w.e.f. 14th December, 2018.
4
Appointed as Director w.e.f. 14th December, 2018.
Directorships and committees held in other companies
Name of Directorship held in the other companies Name of the Committee Whether Chairman
the Director or Member
Mr.Pradeep Glaxo Smith Kline Pharmaceuticals Ltd.– Stakeholders Relationship Committee Member
V. Bhide Independent Director Audit Committee Member
L&T Finance Holdings Ltd.–Independent Director Stakeholders Relationship Committee Member
Heidelberg Cement India Ltd.–Independent Director Audit Committee Member
Stakeholders Relationship Committee Member
Tube Investments India Ltd. – Independent Director Audit Committee Chairman
Quick Heal Technologies Ltd.–Independent Director Audit Committee Member
Nocil Limited – Independent Director - -

73
Ms. Rama Bijapurkar was appointed as an Additional (Independent) Director of the Company at the Board Meeting held on
12th March, 2019 to be effective from 1st April, 2019, subject to Members’ approval. She is on the Board and Member/
Chairperson of the committees in the following companies :-
Name of the Directorship held in the other Name of the Committee Whether Chairman
Director companies or Member
Ms. Rama Mahindra & Mahindra Financial Services Ltd. – Audit Committee Member
Bijapurkar Independent Director Stakeholders Relationship Committee Chairperson
Nestle India Limited – Independent Director Stakeholders Relationship Committee Chairperson
Emami Limited – Independent Director - -
ICICI Bank Limited – Independent Director - -
(b) Attendance of each director at the Board Meetings and the last Annual General Meeting (AGM)
Name of the Director No. of Attendance at the Board Meetings held on Attendance of
Board each Director
Meetings at last AGM
held held on
April May July September Novem- Decem- Janu- March September
12, 28, 21, 28, ber 1, ber 14, ary 24, 12, 28, 2018
2018 2018 2018 2018 2018 2018 2019 2019
1
Mr. Raymond S. Noronha 8 Yes NA NA NA NA NA NA NA NA
2
Mr. Pradeep V. Bhide 8 NA Yes Yes Yes Yes Yes Yes Yes Yes
Mr. Devraj Lahiri 8 Yes Yes Yes Yes Yes Yes Yes Yes Yes
Mr. S. Thirumalai 8 Yes Yes Yes Yes Yes Yes Yes Yes Yes
Mrs. Mubeen Rafat 8 Yes Yes Yes Yes Yes Yes Yes Yes Yes
3
Mr. Ramakrishna V. Addanki 8 Yes Yes Leave of Leave of Yes NA NA NA Leave of
Absence Absence Absence
4
Mr. Naresh Kumar Sethi 8 NA NA NA NA NA Yes Leave of Yes NA
Absence
1
2
Appointed as Director w.e.f. 12th April, 2018.
3
4
Appointed as Director w.e.f.. 14th December, 2018. Representing equity interest of promoter group – British American
Tobacco, U.K.
None of the Independent Non-Executive Directors has any pecuniary relationship or transactions with the Company, its
promoters or its senior management which in the judgement of Board may affect the independence of the Director
except receiving sitting fees for attending Board/Committee meetings and commission from the Company.
In the opinion of the Board, the independent directors fulfill the conditions specified in these regulations and are independent
of the management.
(c) Other details
The Board of Directors of your Company is routinely presented with all requisite information inter alia as required under
the Companies Act, 2013 and the Listing Regulations. Detailed agenda notes containing details required for decision
making are circulated to the Directors in advance. The Meetings are held as per the calendar finalized in consultation
with the Board Members and the notice and agenda of the meetings are circulated well in advance.
28
The Board exercises its powers subject to the provisions of the Companies Act, 2013, Memorandum & Articles of
Association, the Listing Regulations and other statutory provisions. The Board reviews the performance and takes on
record the actions taken by the Company/management on its suggestions. The Board meets atleast four times a year
and the gap between two meetings is not more than 120 days.
None of the Directors on the Board is a Member of more than ten committees or a Chairman of more than five such
committees, across all the companies in which he/she is a Director as required under Regulation 26 of the Listing
Regulations.
The Board has identified the following core skills/expertise/ competencies with reference to the business environment in
which the Company operates:
S.No. Skills/expertise/competencies Whether available or not
1. Governance Yes
2. Business Strategy Yes
3. Marketing Yes
4. Finance Yes
5. Regulatory Yes
Independent Directors’ Meeting
During the year, the Independent Directors met on 12th April, 2018 without the presence of non-independent Directors
and members of management inter alia to review their role, functions and duties. They further reviewed the guidelines
of professional conduct as enumerated in Schedule IV (Code for Independent Directors) to the Companies Act, 2013.
During the said Meeting, the Independent Directors reviewed the performance of Non-Executive Director, including the
Chairman and the Board as a whole.
They also assessed the quality, quantity and timeliness of flow of information between the Company management and
the Board that is necessary for the Board to effectively and reasonably perform its duties and found them to be satisfactory.
(d) Familiarization Programme for Independent Directors
In order to familiarize the Independent Directors with the Company and to inform them about their roles, rights and
responsibilities, the Company conducts orientation programs by various departmental heads such as Legal & Secretarial,
Marketing, Finance, Technical, etc. The Independent Director is also taken for a market visit, visit to tobacco growing
areas, leaf division and tour of the plant. In addition to the above, any other detail which the Director wants or any other
department or function which the Director wants to meet is also arranged. The Policy on Familiarization Programme for
Independent Directors and the details of such familiarisation programmes are disseminated on the website of the
Company (www.vsthyd.com/i/Familiarisation Program.pdf).
The Board also carried out an assessment of the independent directors and confirmed that in its opinion they fulfill the
conditions of independence as specified under the Companies Act and the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 as amended and are independent of management.
3. AUDIT COMMITTEE
(a) Terms of Reference
The primary objective of the Committee is to monitor and provide an effective supervision of the financial reporting
process, to ensure accurate and timely disclosures with highest level of transparency, integrity and quality of financial
reporting. The terms of reference of the Audit Committee covers all the matters specified under Section 177 of the
Companies Act, 2013 and those enumerated in Regulation18 of the Listing Regulations. The terms of reference of the
Audit Committee are as under :
1. Oversight of the Company’s financial reporting process and the disclosure of its financial information to ensure that
the financial statement is correct, sufficient and credible;
2. Recommendation for appointment, remuneration and terms of appointment of auditors of the Company;
3. Approval of payment to statutory auditors for any other services rendered by the statutory auditors;

73
4. Reviewing, with the management, the annual financial statements and auditor’s report thereon before submission 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 Section 134 of the Companies Act, 2013;
b. Changes, if any, in accounting policies and practices and reasons for the same;
c. Major accounting entries involving estimates based on the exercise of judgment by management;
d. Significant adjustments made in the financial statements arising out of audit findings;
e. Compliance with listing and other legal requirements relating to financial statements;
f. Disclosure of any related party transactions;
g. Modified Opinion(s) in the draft audit report;
5. Reviewing, with the management, the quarterly financial statements before submission to the Board for approval;
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 of funds utilized for purposes other than those stated in the offer
document/prospectus/notice and the report submitted by the monitoring agency monitoring the utilization of proceeds
of a public or rights issue, and making appropriate recommendations to the Board to take up steps in the matter;
7. Review and monitor the auditor’s independence and performance, and effectiveness of audit process;
8. Approval or any subsequent modification of transactions of the Company with related parties;
9. Scrutiny of inter-corporate loans and investments;
10. Valuation of undertakings or assets of the Company, wherever it is necessary;
11. Evaluation of internal financial controls and risk management systems;
12. Reviewing with the management, performance of statutory and internal auditors, adequacy of the internal control
systems;
13. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department,
staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal
audit;
14. Discussion with internal auditors of any significant findings and follow up thereon;
15. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected
fraud of irregularity or a failure of internal control systems of a material nature and reporting the matter to the
Board;
16. Discussion with 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 the functioning of the Whistle Blower mechanism;
19. Approval of appointment of CFO (i.e. the Whole-time Finance Director or any other person heading the finance
function or discharging that function) after assessing the qualifications, experience and background, etc. of the
candidate;
20. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee.
The Audit Committee mandatorily reviews the following information:
1. Management discussion and analysis of financial condition and results of operations;
2. Statement of significant related party transactions (as defined by the Audit Committee) submitted by management;
3. Management letters/letters of internal control weaknesses issued by the statutory auditors;
4. Internal audit reports relating to internal control weaknesses;
5. The appointment, removal and terms of remuneration of the internal auditor shall be subject to review by the audit
committee; and
6. Statement of deviations:
30
a] Quarterly statement of deviation(s) including report of monitoring agency, if applicable, submitted to stock
exchange(s) in terms of Regulation 32(1);
b] Annual statement of funds utilized for purposes other than those stated in the offer document/prospectus/notice
in terms of Regulation 32(7).
(b) Composition, Meetings and Attendance during the financial year
Attendance at the Audit Committee Meetings held on
Name of the Member Category April 11, May 28, July 21, September October January
2018 2018 2018 28, 2018 31, 2018 23, 2019
Mr. S. Thirumalai Independent Non- Yes Yes Yes Yes Yes Yes
Executive Director
[Chairman]
Ms. Mubeen Rafat Independent Non- Yes Yes Yes Yes Yes Yes
Executive Director
Mr. Raymond S. Noronha Non-Executive Director Yes NA NA NA NA NA
Mr. Pradeep V. Bhide Non-Executive Director NA NA Yes Yes Yes Yes
The representatives of the statutory auditors and internal auditors and the CFO are the permanent invitees and they have
attended all the meetings held during the year. The Company Secretary is the Secretary to the Committee. Minutes of the
Audit Committee Meetings are circulated to the Members of the Board of Directors and taken note of.
4. NOMINATION & REMUNERATION COMMITTEE:
(a) Terms of Reference
Pursuant to Section 178 of Companies Act, 2013 read with Regulation 19 of the Listing Regulations, the terms of
reference are as under:
a) Identify persons who are qualified to become Directors in accordance with the criteria laid down;
b) Lay down the criteria for appointment at senior management level;
c) Recommend to the Board, appointment and removal of Directors;
d) To vet and approve recommendations from the Executive Directors for the appointment and succession of senior
managers;
e) Formulate a criteria for evaluation of every Director’s performance;
f) Formulate criteria for determining qualifications, positive attributes and independence of a Director;
g) Recommend to the Board a policy relating to remuneration for Directors, Key Managerial Personnel & other employees;
h) Assess, approve or recommend the training and development requirements of Directors and senior management
as recommended by the Executive Directors;
i) Devising a policy on Board Diversity.
(b) Composition, Meetings and Attendance during the financial year
Attendance at the Nomination & Remuneration
Committee Meetings held on
Name of the Member Category April 11, October December January March 12,
2018 31, 2018 14, 2018 23, 2019 2019
Mr. S. Thirumalai Independent Non-Executive Yes Yes Yes Yes Yes
Director [Chairman]
Ms. Mubeen Rafat Independent Non-Executive Yes Yes Yes Yes Yes
Director
Mr. Raymond S. Noronha Non-Executive Director Yes NA NA NA NA
Mr. Pradeep V. Bhide Non-Executive Director NA Yes Yes Yes Yes

73
The Company Secretary acts as Secretary to the Committee.

(c) Remuneration Policy
Purpose
The remuneration policy defines the compensation or remuneration philosophy of the organisation. It specifies the drivers of
the philosophy, where the Company positions itself in the overall industry/market related percentile, who are the comparators
for the purpose of remuneration.
Scope
It covers the Executive Directors and management level employees of the Company comprising senior management, middle
management and junior management.
Compensation Philosophy
The Company's compensation philosophy reflects on the guiding principles of aligning with Company objective of sustained
improvement in performance, promoting a culture of meritocracy, creating a linkage to corporate & individual performance,
market competitiveness and positive influence on the employee contribution and continuity.
The Company's remuneration philosophy aligns with broader HR strategy which reinforces employee value proposition
through enabling work environment, empowering and engaging work culture.
The remuneration philosophy is driven by :
1. Business performance - Remuneration as an effective instrument to enhance performance and therefore link as an
optimum mix of individual & company performance.
2. Remuneration practices support and encourage meritocracy based on objectivity, fairness & transparency.
3. Remuneration policy will act as motivational tool & drive the desired positive behaviors and thus improve the overall
organizational health and performance.
4. Taking in to the competitive context, remuneration is based on market/industry positioning vis-a-vis relevant competitors.
For determining the market/industry positioning, FMCG, manufacturing form the basket of comparators with primary focus
on FMCG sector. The list of the comparators and positioning of the remuneration structure is reviewed periodically as may
be required but atleast once in three years in tune with the requirement of the Company.
Employee compensation positioning is determined by his/her performance as assessed on the basis of the applicable
performance management system.
Policy Definition
Remuneration policy of the Company has been designed to attract, retain and motivate the employees and Directors of the
quality required to run the Company successfully. The remuneration is directly linked to the individual performance and is
measurable on specified benchmarks as set by the Company. The remuneration is an optimum mix of fixed and variable pay
and comprises components as mentioned under :
a. Fixed components : Comprising (i) Basic salary; (ii) Fixed allowances & perquisites; (iii) Retiral benefits.
b. Variable components : Comprising performance linked bonus, paid annually.
Individual compensation fixation is as under :
Executive Directors & senior management : Compensation fitment for executive directors is in the top quartile or thereabout
and for senior management, above the median of the market/industry positioning.
Middle & junior management : Individual compensation fitment in this category is around the median of the market/industry
positioning.
The variable component of the salary at the junior management starts at 10% of the total cost to the Company and goes up
to 35% for senior management. The variable component for the executive Directors is subject to statutory provisions and
approval of the shareholders.
The Company's performance management system differentiates the executives under four categories and they are accordingly
rated based on the agreed key result areas. The reward is linked to the performance rating.
The review of the remuneration structure in line with the market shall be done periodically as may be required but at least
once in three years. All other perquisite and benefits shall also be reviewed at least once in three years.
32
Remuneration to Non-Executive Directors

Non-executive directors of the Company are paid sitting fees for attending Board & Committee meetings, reimbursement of
expenses for attending the meetings and remuneration as approved by the Members within the overall limit prescribed
under the law and are not eligible for any stock options.
Criteria for selection and appointment of directors
Criteria for selection and appointment of Directors is given as part of the Board Report.
Criteria for performance evaluation
Pursuant to the provisions of the Companies Act, 2013 and Regulation19 of the Listing Regulations, criteria for performance
evaluation of individual directors, Board as a whole as well as the Board Committees has been formulated.
Performance of the Directors were evaluated on broad criteria such as contribution and value addition to the Board and
Committees thereof; contribution to the Company and management to achieve its plans, goals, corporate strategy and risk
mitigation; level of preparedness; level of participation in the Board and Committee meetings etc. In addition to the above
parameters, the performance of Executive Directors were also evaluated against their Key Responsibility Areas (KRAs). The
Chairman’s performance was evaluated by Independent Directors on above parameters after taking into account the views
of Executive and Non-Executive Directors. Independent Directors were also assessed by the entire Board (excluding the
person being evaluated), based on their performance, fulfillment of the Independence criteria and their independence from
the management vis-à-vis Code for Independent Directors under Schedule IV of the Companies Act, 2013. A structured
format for evaluation of the Directors on the above parameters has been prepared for the purpose. Director being evaluated
does not participate in the evaluation process.
The performance of Board Committees were evaluated by the Board on the basis of their achievement of charter and role of
each Committee. The performance of Board as a whole was evaluated by the Independent Directors on the basis of its duties
and responsibilities as per terms of reference. The evaluation also assesses the Board composition, need for induction/
change in Directors, Board’s role in contributing to the growth and progress of the Company, etc.
The overall outcome from the evaluation was that the Board and its individual Directors are performing effectively and that
the Board is well supported to focus on strategy, governance and compliance.
(d) Details of remuneration paid to all the Directors for the financial year ended 31st March, 2019
Allowances,
benefits and Performance
Name Position Salary contributions to
Linked Commission Sitting Fees Total
` Provident/Pension ` ` `
and Other Funds Bonus
` `
Mr. Raymond. Chairman -Non- - - - - 1,25,000 1,25,000
S. Noronha 1 Executive Director
Mr. Pradeep Chairman -Non- - - - 65,00,000 6,65,000 71,65,000
V. Bhide 2 Executive Director
Mr. S. Thirumalai Independent Non- - - - 40,00,000 9,25,000 49,25,000
Executive Director
Mr. Devraj Lahiri Managing Director 63,58,888 98,43,621 94,11,154 - - 2,56,13,663
Ms. Mubeen Rafat Independent Non- - - - 30,00,000 9,25,000 39,25,000
Executive Director
Mr. Ramakrishna Non-Executive - - - - @ -
V. Addanki 3 Director
Mr. Naresh Kumar Non-Executive - - - - @ -
Sethi 4 Director
1
2
Appointed as Director w.e.f. 12th April, 2018.
3
4
Appointed as Director w.e.f.. 14th December, 2018. Representing equity interest of promoter group–British American
Tobacco, U.K.

73
@ Waived entitlement to sitting fees.

The Company has no stock option scheme and hence no stock options have been granted to the Directors.
Benefits for Managing Director include gas, electricity, water, furnishings, medical reimbursement and leave travel concession
for self and family, club fees, personal accident insurance, etc. in accordance with the Rules of the Company, the monetary
value of such perquisites being limited to Rs. 36,00,000 per annum. In addition, the following perquisites are provided
which are not included in the above monetary limit:
a. Rent free furnished accommodation owned/leased/rental by the Company or housing allowance in lieu thereof,
subject to a maximum of 30% of Consolidated Salary.
b. Contribution to provident fund and superannuation fund upto a maximum of 27% of salary and contribution to
gratuity fund upto 8.33% of salary as limited and defined in the Rules of the respective funds, or upto such other limit
as may be prescribed under the Income Tax Act, 1961 and the Rules thereunder for this purpose;
c. Use of Company car for official purposes and telephone at residence and cell phone (including payment for local
calls and long distance official calls);
d. Encashment of unavailed leave as per the Rules of the Company at the time of retirement/cessation of service;
e. Long service award as per the Rules of the Company;
f. Costs and expenses incurred by the Company in connection with joining/transfer from one location to another as
per the Rules of the Company.
The appointment of Executive Directors is governed by Resolutions passed by the Board of Directors and the Members of the
Company, which cover the terms and conditions of such appointment, read with the service rules of the Company. The notice
period for Executive Directors is six months as per Article No.101 of Articles of Association of the Company. No significant
material transactions have been made with the Non-Executive Directors vis-a-vis the Company. There are no service contracts
entered into and no severance fees paid to the Directors.
Performance of the Managing Director is evaluated basis his achievement as determined by the Key Result Areas identified
and agreed at the beginning of the year.
(e) Criteria for making payments to Non-Executive Directors
The Board periodically reviews the criteria for making payments to Non-Executive Directors. The Non-Executive Directors are
paid sitting fees for attending each Meeting of the Board or its Committee as per the details given below :
From 1st April to From 1st
31st December 2018 January 2019
Board Meeting -Rs. 35,000 Rs. 80,000
Audit Committee -Rs. 25,000 Rs. 70,000
Stakeholders Relationship Committee -Rs. 20,000 Rs. 30,000
Nomination & Remuneration Committee -Rs. 25,000 Rs. 50,000
Corporate Social Responsibility Committee -Rs. 20,000 Rs. 30,000
Risk Management Committee - - Rs. 50,000
Committee of Directors * -Rs. 15,000 -
* Committee was disbanded with effect from 1st November, 2018.
Members of the Company have approved payment of commission not exceeding one percent of the net profits to the Non-
Executive Directors of the Company for each of the five financial years commencing from 1st April, 2018. Commission paid
to Non-Executive Directors is determined based on their performance evaluation and on the basis of their memberships in
various committees of the Board.
34
5. STAKEHOLDERS’ RELATIONSHIP COMMITTEE

In terms of Section 178 of the Companies Act, 2013 and Regulation 20 of the Listing Regulations, the Committee inter
alia looks after the redressal of investors’ complaints, issue of duplicate shares, reviews the work of Registrar and Share
Transfer Agents, etc.
Composition, Meetings and Attendance during the financial year
Attendance at the Stakeholders’ Relationship Committee
Meetings held on
Name of the Member Category April 11, July 21, September October December January
2018 2018 28, 2018 31, 2018 14, 2018 23, 2019
Ms. Mubeen Rafat Independent Non-Executive Yes Yes Yes Yes Yes Yes
Director [Chairperson]
Mr. S. Thirumalai Independent Non- Yes Yes Yes Yes Yes Yes
Executive Director
Mr. Raymond S. Noronha Non-Executive Director Yes NA NA NA NA NA
Mr. Devraj Lahiri Managing Director Yes Yes Yes Yes Yes Yes
Mr. Pradeep V. Bhide, Non-Executive Director is the permanent invitee.

The Company Secretary acts as the Secretary to the Committee.
i) Name and designation of Compliance Officer : Phani K. Mangipudi, Company Secretary
ii) Number of shareholders’ complaints received and attended during the financial year ended
31st March, 2019
Nature of complaints / queries Received Attended Pending

Non-receipt of annual reports 0 0 Nil
Non-receipt of dividend warrants 55 55 Nil
Non-receipt of share certificates 10 10 Nil
Letters from stock exchanges / SEBI 12 12 Nil
The shareholders/investors complaints and other complaints are normally responded to as prescribed by SEBI
under general norms for processing documents, transfers etc., except where constrained by disputes or legal
impediments. There are some pending cases relating to disputes over the title to shares in which the Company has
been made a party. However, these cases are not material in nature.
6. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
In compliance with the provisions of Section 135 of the Companies Act, 2013, Corporate Social Responsibility Committee
has been constituted.
The terms of reference of the Committee are as under :
- Identify the areas for carrying out the activities and formulate policy to undertake the same;
- Identify the projects, programs for specific area of activity, finalise the budget and earmark the expenditure for each
activity and recommend the same to the Board every year;
- To determine the location where CSR activities shall be undertaken;

73
- To monitor the progress of the projects/activities from time to time;

- To nominate employees who shall be responsible for implementation, execution and monitoring of CSR activities;
- To hire services of external service providers, Non-Governmental Organisations (NGOs), volunteers, professionals,
consultants, specialized agencies, etc., if required, to undertake such activities.
Composition, Meetings and Attendance during the financial year
Attendance at the CSR Committee
Meetings held on
Name of the Member Category
April 11, 2018 October 31, 2018
Ms. Mubeen Rafat Independent Non-Executive Director [Chairperson] Yes Yes
Mr. S. Thirumalai Independent Non-Executive Director Yes Yes
Mr. Raymond S. Noronha Non-Executive Director Yes NA
Mr. Pradeep V. Bhide Non-Executive Director NA Yes
Mr. Devraj Lahiri Managing Director Yes Yes
The Company Secretary acts as the Secretary to the Committee.

7. SUBSIDIARY COMPANY
The Company does not have any material subsidiary company as defined in Regulation 16 of the Listing Regulations.
Hence, no policy for determining material subsidiaries has been framed.
8. RISK MANAGEMENT
The Company has laid down procedures to inform Board members about the risk assessment and minimization
procedures. The Company has constituted the Risk Management Committee in terms of Regulation 21 of SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015 effective from April 2019.
9. GENERAL BODY MEETINGS
(i) Location and time of last three Annual General Meetings are as under:
Year Venue Date Time

2017-18 Hotel Taj Krishna, Banjara Hills, Hyderabad 28.09.2018 09.30 a.m.
(ii) The following Special Resolutions were passed by the Members at the last three Annual General Meetings:
Annual General Meeting held on 28th September, 2018
● Payment of Remuneration by way of Commission to Non-Executive Directors
Annual General Meeting held on 2nd August, 2017
● No special resolutions was passed
Annual General Meeting held on 11th August, 2016
● No special resolutions was passed
(iii) No special resolution was passed through postal ballot during the year. No special resolution is proposed to be
conducted through postal ballot.
36
10. MEANS OF COMMUNICATION

The quarterly/half yearly financial results are announced within 45 days of close of each quarter. The annual audited
financial results are announced within 60 days from the close of the financial year as per the requirements of the Listing
Regulations. The aforesaid financial results are disclosed to BSE Limited [BSE] and The National Stock Exchange of India
Limited [NSE] where the Company’s securities are listed. The quarterly, half yearly and annual financial results are
published in Business Standard and in a vernacular newspaper i.e., Andhra Prabha/Nava Telangana. The results along
with other official information are also posted on the Company’s website viz., www.vsthyd.com.
During the year, there were no presentations made to institutional investors or to the analysts.
The Stock Exchanges viz., BSE and NSE, maintain separate online portals for electronic submission of information. As
part of the Listing Regulations compliances, all the disclosures, results and other communications are filed electronically
on these online portals.
11. GENERAL SHAREHOLDER INFORMATION
Date, Time and Venue of the Annual General Meeting
28th August, 2019 at 9.30 a.m. at Grand Ball Room, Hotel Taj Krishna, Road No. 1, Banjara Hills,
Hyderabad-500 034, Telangana.
Financial year : 1st April, 2018 to 31st March, 2019
Financial Calendar 2019-20 [Tentative]
First quarter results July, 2019
Second quarter and half yearly results November, 2019
Third quarter results January, 2020
Annual results April, 2020
Dates of Book Closure : 21st August, 2019 to 28th August, 2019 [both days inclusive]
Dividend Payment Date : Within 30 days of the AGM date.
Listing on Stock Exchanges with Stock Code:
S.No. Name of the Stock Exchange Stock Code
1 BSE Limited
25th Floor, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai – 400 001 509966
2 National Stock Exchange of India Limited
Exchange Plaza, C-1, Block G, Bandra-Kurla Complex, Bandra (E),
Mumbai – 400 051 VSTIND
Annual Listing Fees have been paid to the above stock exchanges.

73
Market Price Data: High/Low during each month in the last financial year (2018-19)
1 2
BSE NSE
Period
High ` Low ` High ` Low `
April, 2018 3288.00 2828.00 3198.10 2906.30

May, 2018 3215.00 2960.00 3185.00 3000.00
June, 2018 3246.05 2871.00 3205.00 2880.00
July, 2018 2992.85 2470.00 2977.00 2470.00
August, 2018 3324.00 2600.05 3328.00 2601.00
September, 2018 3430.00 2755.00 3444.35 2753.80
October, 2018 3186.00 2481.30 3202.00 2487.40
November, 2018 3325.00 2867.00 3328.00 2850.35
December, 2018 3332.00 3026.05 3300.00 3001.00
January, 2019 3319.00 3045.05 3309.00 3041.35
February, 2019 3300.00 3147.05 3285.00 3131.30
March, 2019 3580.00 3200.00 3524.90 3200.40
1
Source – www.bseindia.com
2
Source – www.nseindia.com
Performance in comparison with BSE Sensex
[based on closing price/Sensex] [Source:www.bseindia.com]
VST INDUSTRIES LIMITED

40000.00
3900.00
39000.00
3700.00
BSE Sensex
Share Price (`)
38000.00
3500.00
3300.00 37000.00
3100.00 36000.00
---- Share Price
2900.00 35000.00 ----BSE Sensex
2700.00 34000.00
February, 2019
April, 2018
May, 2018
June, 2018
July, 2018
January, 2019
August, 2018
October, 2018
December, 2018
March, 2019
November, 2018
September, 2018
38
Performance in comparison with Nifty 50

[based on closing price/Nifty 50] [Source: www.nseindia.com]
VST INDUSTRIES LIMITED

3500.00 11900.00
11700.00
3300.00 11500.00
Share Price (`)
11300.00
3100.00 11100.00
10900.00
Nifty 50
2900.00 10700.00
10500.00
2700.00 10300.00 ---- Share Price
February, 2019
April, 2018
May, 2018
June, 2018
July, 2018
August, 2018
March, 2019
December, 2018
September, 2018
November, 2018
January, 2019
October, 2018
---- Nifty 50
None of the Securities of the Company were suspended from trading during the year.
Registrar and Transfer Agents
As a Member of the Company, you are encouraged to contact the Registrar and Transfer Agents for all your shares
related services and queries at the below address:
Karvy Fintech Private Limited
Karvy Selenium Tower B, Plot No. 31 & 32
Financial District, Nanakramguda, Gachibowli
Hyderabad - 500 032
Telangana
Tel: + 91 40 6716 1606 Fax: + 91 40 2342 0814
email: einward.ris@karvy.com
Contact Person: Mr. Praveen Chaturvedi – General Manager – Corporate Registry
Mr. Raghu Veedha– Deputy Manager – Corporate Registry
Share Transfer System
The share transfers which are received in physical form are registered and returned in the normal course within an
average period of 15 days from the date of receipt, if the documents are clear in all respects. The Board has delegated
the authority for approving transfer, transmission etc., of the Company’s securities to the Share Transfer Committee,
comprising of Managing Director and Company Secretary. A summary of transfer and transmission of shares of the
Company approved is placed at the Meeting of the Stakeholders’ Relationship Committee.
Requests for dematerialisation of shares are processed and confirmation is given to the respective depositories i.e.,
National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) within 2 working
days from the date of receipt of request. There are no pending share transfers as at 31st March, 2019.

73
Distribution of shareholding as on 31st March, 2019

No. of No. of
Slab % %
Shares Shareholders
1 - 500 8,89,240 5.76 14,376 94.87
501 - 1000 3,03,721 1.97 421 2.78
1001 - 2000 2,55,069 1.65 182 1.20
2001 - 3000 1,59,446 1.03 65 0.43
3001 - 4000 80,747 0.52 23 0.15
4001 - 5000 57,310 0.37 13 0.09
5001 -10000 1,92,025 1.24 27 0.18
10001and above 1,35,04,362 87.45 46 0.30
Total 1,54,41,920 100.00 15,153 100.00
Physical Mode 5,29,720 3.43 2,364 15.60
Demat Mode 1,49,12,200 96.57 12,789 84.40
Dematerialisation of shares and liquidity

With effect from 26th June, 2000, trading in the Company’s shares was made compulsory in the dematerialised form.
The Company’s shares are available for trading in the depository systems of both National Securities Depository Limited
(NSDL) and Central Depository Services (India) Limited (CDSL).
As at 31st March, 2019, 1,49,12,200 equity shares of the Company constituting 96.57% of Issued and Subscribed
Capital, were held in depository mode. The processing activities with respect to the requests received for dematerialisation
are generally completed within two working days. Under the Depository System, the International Securities Identification
Number (ISIN) allotted to the Company’s shares is INE710A01016. The annual custody fee for the financial year 2019-
2020 will be remitted to NSDL and CDSL, the Depositories before the due date.
The Company’s shares are regularly traded both on BSE and NSE.
Categories of Shareholding as on 31st March, 2019
Category Number of Shares held Percentage of Shareholding
Promoters and Associates 49,65,902 32.16

FIIs/FPIs 13,69,564 8.87
Insurance Companies 2,45,471 1.59
Mutual Funds 25,00,825 16.20
Nationalised banks and other banks 13,597 0.09
NRI’s and OCB’s 98,335 0.63
Bodies Corporate 42,21,693 27.34
Indian Public and Others 20,26,533 13.12
TOTAL 1,54,41,920 100.00
40
Reconciliation of Share Capital Audit

For each quarter of the financial year 2018-19, a qualified Company Secretary in Practice has carried out audit under
Regulation 55A of SEBI (Depositories and Participants) Regulations, 1996, as amended to reconcile the total admitted
capital with NSDL and CDSL and total issued and listed capital. The audit report confirms that the total issued/paid-up
capital is in agreement with the total number of shares in physical form and the total number of dematerialized shares
held with NSDL and CDSL and the same is filed with BSE & NSE.
Similarly, the Company obtains from a Company Secretary in Practice, half-yearly certificate of compliance with the
share transfer formalities as required under Regulation 40(9) of the Listing Regulations and copy of the same is filed with
BSE and NSE.
Outstanding GDRs/ADRs/Warrants or any Convertible Instruments, conversion date and likely
impact on Equity
Not applicable as the Company has not made any such issue.
Commodity price risk or foreign exchange risk and hedging activities
During the year, the Company had managed the foreign exchange risk and hedged to the extent considered necessary.
The Company uses forward exchange contracts to hedge its foreign currency exposures related to the underlying
transactions, firm commitments and highly probable forecasted transactions. The use of these foreign exchange forward
contracts are intended to reduce the risk or cost to the Company and are not intended for trading or speculation
purpose. The details of foreign currency exposure are disclosed in Note No. 31 to the Financial Statements.
The Principal raw material used by the Company in manufacture of its finished product i.e. Cigarettes, is tobacco.
Factors that influence fluctuations in tobacco prices and availability include farm prices, government’s policies, operational
issues, natural disasters and economic conditions among others.
The Company’s commodity risk is arising from volatility in price and non-availability of tobacco is managed centrally
through well-established operations and control processes which includes diversified tobacco sourcing strategy from
both dealers and farmers coupled with sourcing in different seasons. There have been no significant changes in the
nature of the risk exposures over the last 12 months and there is no futures market in tobacco. Therefore, there are no
separate disclosures to offer in terms of the SEBI Regulations/circulars issued from time to time.
Plant Locations
1-7-1063/1065, Azamabad, Survey No.288/289,
Hyderabad – 500 020 Muppireddy Palli,
Telangana Toopran, Medak, Telangana
Address for correspondence
Registered Office
VST Industries Limited Mr. Phani K. Mangipudi
1-7-1063/1065, Azamabad Company Secretary & Compliance Officer
Telephone +91 40 2768 8000
Fax: +91 40 2761 5336
Email: investors@vstind.com
No credit ratings have been obtained by the Company during the relevant financial year for any debt instruments or any
fixed deposit programme or any scheme or proposal of the Company involving mobilization of funds, whether in India
or abroad.

73
12. DISCLOSURES
i) Related Party Transactions (RPT)
There were no materially significant transactions with related parties during the financial year which were in conflict
with the interest of the Company as contained under Section 188 of Companies Act, 2013. Suitable disclosures as
required by the Indian Accounting Standards [IND AS24] have been made in the notes to the Financial Statements.
The Company has also formulated a policy for determining the Material RPT and the details of such policies for
dealing with RPT and the Related Party Transactions are disseminated on the Company’s website at: (www.vsthyd.com/
i/VST RPT Policy1.pdf).
The details of transactions with related parties were placed before the Audit Committee and the Committee has
reviewed the same for the year ended 31st March, 2019. The details of related party transactions are disclosed in
Note No. 29 of Notes on Financial Statements to the Accounts in the Annual Report and also in Form AOC-2
attached with the Boards’ Report.
ii) Strictures and Penalties
No strictures or penalties have been imposed on the Company by the Stock Exchanges or by the Securities and
Exchange Board of India [SEBI] or by any statutory authority on any matters related to capital markets during the last
three years.
iii) Vigil Mechanism/Whistle Blower Policy
In terms of Section 177(9) and 177(10) of the Companies Act, 2013 and Regulation 22 of the Listing Regulations,
a Whistle blower Policy is formulated to encourage all employees & Directors of the Company to report any
unethical behaviour, actual or suspected fraud or violation of the ‘Code of Conduct and Ethics Policy’ of the
Company. The said policy also has provisions for providing a secure environment to such employees acting in good
faith and safeguarding them from any adverse action by the management.
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 concerns. A Committee has been constituted which looks into
the complaints raised. The Committee reports to the Audit Committee. Any matter can be reported at E-mail ID :
whistleblower@vstind.com.
In case of disclosure against any Director or in case of no corrective action or non receipt of response on the
disclosure within 30 days, the whistle blower shall have the right to directly approach the Chairman of the Audit
Committee. No personnel have been denied access to the Audit Committee in this regard.
The Company since has not raised any funds through preferential allotment or qualified institutions placement,
there is no question of utilization of such funds.
There have been no instances where the board has not accepted any recommendation of any committee of the
board which is mandatorily required during the financial year.
iv) Code of Conduct
Your Board of Directors has laid down Code of Conduct & Ethics Policy which is applicable to all Board Members
and employees of the Company. This is also posted on the website of the Company [www.vsthyd.com]. The Code
lays down the standard of conduct to be followed by all the Directors and Employees in their business dealings and
in particular on matters relating to integrity in the work place, in business practices and in dealing with the stakeholders.
The Code also contains the duties of Independent Directors as laid down in the Companies Act, 2013.
Declaration
This is to confirm that all the Board Members and senior management personnel have affirmed compliance with
the Code of Conduct as adopted by the Company, for the year ended 31st March, 2019.
For VST INDUSTRIES LIMITED
DEVRAJ LAHIRI
Hyderabad, 16th April, 2019 MANAGING DIRECTOR
42
v) Accounting Treatment
In preparation of the financial statements, the Company has followed the accounting principles generally accepted
in India, including Accounting Standards specified under Section 133 of the Companies Act, 2013 read with Rule 3
of the Companies (Indian Accounting Standard) Rules, 2015. The accounting policies which are consistently applied
have been set out in the Notes to the Financial Statements.
vi) Management
Pursuant to Regulation 26(5) of the Listing Regulations, for the year ended 31st March, 2019 your Company’s
Board has obtained declarations from the Senior Management relating to any material, financial and commercial
transactions where they have personal interest that may have a potential conflict with the interests of the Company
at large.
vii) Shareholders Information
The quarterly results are sent to the stock exchanges on which the Company’s shares are listed and also displayed
on its own website. During the year there were no presentations made by the Company to analysts.
To expedite the process of share transfers, post approval of Share Transfer Committee, the power has been delegated
to Registrar and Transfer Agents – M/s. Karvy Fintech Private Limited.
viii)Prohibition of Insider Trading
In compliance with the provisions of SEBI (Prohibition of Insider Trading) Regulations, 2015 as amended, the
Company has adopted a Policy for prohibition of Insider Trading for Directors and specified employees and designated
persons. The Policy provides for periodic disclosures and pre-clearance for dealing in Company’s shares and
prohibits such transaction by the Directors and specified employees while in possession of unpublished price sensitive
information (UPSI) in relation to the Company and during the period when the Trading Window is closed. The
Company has also formulated a policy on inquiry in case of leak of UPSI.
ix) Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
a. No. of complaints filed during the financial year Nil
b. No. of complaints disposed of during the financial year Nil
c. No. of complaints pending as on end of the financial year Nil
There have been no instances of non-compliance of any requirement of corporate governance.
x) Statutory Auditor
The Statutory Auditor of the Company and all the entities in the network firm/network entity of which the statutory
auditor is a part have been paid a total fees of Rs. 46.25 lakhs for all the services rendered by them during the
financial year 2018-19.
xi) CEO and CFO Certification
The CEO (Managing Director) and CFO certification for the year ended 31st March, 2019 has been annexed at the
end of this Report. Similarly, the CEO and CFO have also given quarterly certification on financial results while
placing the quarterly financial results before the Board in terms of Regulation 33(2) of the Listing Regulations.
xii) Adoption of Discretionary Requirements
The Company has complied with all the mandatory requirements of Regulation 34(3) read with Part C of Schedule
V of Listing Regulations.
Discretionary requirements under Part E of Schedule II of the Listing Regulations are as under:
a] The Non-Executive Chairman is allowed to maintain a Chairman’s office at the Company’s expense and also
allowed reimbursement of expenses incurred in performance of his duties.

73
b) Shareholder rights: The quarterly, half-yearly and annual financial results of the Company are published in
newspapers on a pan India basis and are also posted on the Company’s website, www.vsthyd.com. Significant
events if any are also posted on this website under the ‘Investor relations’ section. The complete Annual Report
is sent to every Shareholder of the Company
c] The auditors have not qualified the financial statements of the Company.
d] The Company is having separate post of Chairman and Managing Director. Mr. Pradeep V. Bhide as the Chairman
of the Company and Mr. Devraj Lahiri as the Managing Director of the Company.
e] M/s. Deloitte Haskins and Sells LLP, the firm of Chartered Accountants have been the Internal Auditors for the
financial year 2018-19, who report directly to the Audit Committee.
Other discretionary requirements are being reviewed for implementation.
The Company has complied, to the extent applicable to it, with all the corporate governance requirements specified in
Regulation 17 to 27 and Regulation 46(2) of the Listing Regulations as amended covering the Board of Directors, Audit
Committee, Nomination & Remuneration Committee, Stakeholders Relationship Committee, Risk Management Committee,
Vigil Mechanism, Related party transactions, obligations with respect to the Directors, Independent Directors and senior
management, other Corporate Governance requirements and disclosures on the website of the Company.
13.AUDITOR’S CERTIFICATE ON CORPORATE GOVERNANCE
As required under Regulation 34(3) read with Part E Schedule V of the Listing Regulations, the statutory auditor’s certificate
that the Company has complied with the conditions of corporate governance is given as an annexure to the Boards’
Report.
SHAREHOLDER REFERENCER
Pursuant to Section 124 of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting,
Audit, Transfer and Refund) Rules, 2016, during the financial year 2018-19, unclaimed dividend for the financial year 2010-
11 viz., Dividend No.176 th amounting to Rs. 58,14,225/- has been transferred to the Investor Education and Protection
Fund (IEPF) on 14th September, 2018 and 10,640 ordinary equity shares in respect of which dividends remained unclaimed
for a consecutive period of seven years or more have been transferred by the Company to the IEPF as notified and established
by the Central Government. Shareholders may claim their unclaimed dividend for the years prior to and including the
financial year 2010-11 and the corresponding shares from the IEPF Authority by applying in the prescribed Form No.IEPF-
5. This form can be downloaded from the website of the IEPF Authority www.iepf.gov.in.
The dividends for the following years remaining unclaimed for 7 years will be transferred on their respective due dates by the
Company to the IEPF established by the Central Government pursuant to Section 125 of the Companies Act, 2013.
Financial Dividend Date of Amount of Amount of Unpaid Dividend as Due for transfer to
Year No. Declaration Dividend on 31.03.2019 IEPF on
Rs. Rs.
2011-2012 177 12.07.2012 100,37,24,800 1,30,73,190.00 16.08.2019
2012-2013 178 30.07.2013 96,51,20,000 1,35,81,312.50 04.09.2020
2013-2014 179 12.08.2014 108,09,34,400 1,50,23,190.00 16.09.2021
2014-2015 180 12.08.2015 108,09,34,400 1,60,63,390.00 16.09.2022
2015-2016 181 11.08.2016 108,09,34,400 1,56,15,600.00 15.09.2023
2016-2017 182 02.08.2017 115,81,44,000 1,81,79,475.00 06.09.2024
2017-2018 183 28.09.2018 119,67,48,800 1,69,16,157.50 03.11.2025
Members who have not so far encashed their dividend warrant(s) or have not received the same are requested to seek issue
of duplicate warrant(s) by writing to the Company’s Registrar & Transfer Agents confirming non-encashment/non-receipt of
dividend warrant(s). Shares for which the dividend remains unclaimed for seven consecutive years will be transferred to the
IEPF for which notices in this regard have been published in the newspapers and the shareholders have been individually
intimated. Details of such unclaimed dividend and shares are available on the Company’s corporate website under the
44
section ‘Investor Relations-Unclaimed dividend and shares’.

BANK DETAILS
Members holding shares in physical form are requested to notify the following to the Registrar & Transfer Agents, to facilitate
electronic payment.
- particulars of their bank account – name of the bank, branch with complete postal address, account number, MICR
and IFSC
Members holding shares in Dematerialised form and not opted for remittance of dividend through NECS are requested to
notify the above details to their respective Depository Participants [DPs].
Remittance of Dividend through National Electronic Clearing Service [NECS]
The Company provides the facility of remittance of dividend through NECS to Members provided they maintain accounts
with those branches of the banks which have implemented Core Banking System (CBS) and participated in the NECS facility
extended by the Reserve Bank of India.
Members holding shares in physical form, who now wish to avail NECS facility, may send their NECS mandate in the
prescribed form to the Company. The NECS mandate form can be furnished by the Registrars and Transfer Agents on
request or can be downloaded from the Company’s website www.vsthyd.com under the section Investor Relations – NECS
Mandate Form. Members holding shares in demat form are requested to update their bank account details with their
respective Depository Participants [DPs].
DEPOSITORY SERVICES
For guidance on depository services, Members may write to the Registrar and Transfer Agents or to the respective depositories:
National Securities Depository Limited Central Depository Services (India) Limited
4th Floor, 'A' Wing, Trade World, Kamala Mills Compound, Marathon Futurex, A-Wing
Senapati Bapat Marg, Lower Parel, 25th Floor, N.M. Joshi Marg, Lower Parel
MUMBAI – 400 013 MUMBAI – 400 013
Telephone: + 91 22 2499 4200 Telephone: + 91 22 2272 3333 / 2272 3224
Fax: + 91 22 2497 2993 / 2497 6351 Fax: + 91 22 2272 3199 / 2272 2072
e-mail: info@nsdl.co.in e-mail: investors@cdslindia.com
Website: www.nsdl.co.in Website: www.cdslindia.com
INVESTOR GRIEVANCES
Your Company has created exclusive E-mail ID for redressal of investor grievances. The Members can send their queries to
the E-mail ID: investors@vstind.com
NOMINATION FACILITY
The facility of nomination can be availed by the Members holding the shares in single name. In cases where the shares are
held in joint names, the nomination will be effective only in the event of the death of all the holders. Members are advised
to avail of this facility by submitting the nomination in Form No. SH-13 which could be obtained from Registrars – M/s.Karvy
Fintech Private Limited at the address mentioned above or can be downloaded from the Company’s website www.vsthyd.com
under the section Investor Relations.
Where the shares are held in dematerialised form, the nomination has to be conveyed by the Members to their respective
Depository Participant directly, as per the format prescribed by them.

73
DETAILS OF UNCLAIMED SHARES

The details of shares remaining in the unclaimed suspense account as required under Regulation 34(3) read with Schedule
V[F] of the Listing Regulations are given below:
Particulars No. of shareholders No. of shares
Outstanding at the beginning of the year - 1st April, 2018 116 10,048
No. of Members who approached for transfer of shares 0 0
Members to whom shares were transferred - through rematerialisation 0 0
Transferred to IEPF 9 1134
Outstanding shares lying at the end of the year - 31st March, 2019 107 8914
The Members who have not claimed the shares still from the above returned undelivered cases are requested to contact the
Registrar-M/s. Karvy Fintech Private Limited at the address given above.
The voting rights on the shares outstanding in the above suspense account as on March 31, 2019 shall remain frozen till the
rightful owner of such shares claims the shares.
46
Certificate of Non-Disqualification of Directors

[(Pursuant to Regulation 34(3) and Schedule V Para C clause (10)(i) of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015)]
To
The Members of
Azamabad, Hyderabad.
I, B V Saravana Kumar, Company Secretary in Practice, Partner of Tumuluru & Company have examined the relevant
registers, records, forms, returns and disclosures received from the Directors of VST Industries Limited having CIN
L29150TG1930PLC000576 and having registered office at Azamabad, Hyderabad – 500 020, Telangana India (hereinafter
referred to as ‘the Company’), produced before me/us by the Company for the purpose of issuing this Certificate, in
accordance with Regulation 34(3) read with Schedule V Para-C Sub clause 10(i) of the Securities Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015 as amended.
In our opinion and to the best of our information and according to the verifications (including Directors Identification
Number (DIN) status at the portal www.mca.gov.in) as considered necessary and explanations furnished to us by the
Company & its officers, we hereby certify that none of the Directors on the Board of the Company as stated below for the
Financial Year ending on 31st March, 2019 have been debarred or disqualified from being appointed or continuing as
Directors of companies by the Securities and Exchange Board of India, Ministry of Corporate Affairs, or any such other
Statutory Authority.
Sl. No. DIN Name of the Director Designation

1. 03304262 Pradeep Vasudeo Bhide Non-Executive Chairman
2. 03588071 Devraj Lahiri Managing Director
3. 00011899 Sampathkumaran Thirumalai Independent Director
4. 02097314 Mubeen Rafat Independent Director
5. 08296486 Naresh Kumar Sethi Nominee Director
For Tumuluru & Company

Company Secretaries
Place: Hyderabad Signature: sd/-

Date: 03.05.2019 Name: B V Saravana Kumar
Partner
ACS No.: 26944
C P No.: 11727

73
Certification by Managing Director (MD) and

Chief Financial Officer (CFO)
We, Devraj Lahiri, Managing Director and Anish Gupta, Chief Financial Officer of VST Industries Limited, to the best of our
knowledge and belief, certify that :
1. We have reviewed the financial statements and the cash flow statement for the year ended 31st March, 2019 and
that :
a) These statements do not contain any materially untrue statement or omit any material fact or contain statements
that might be misleading;
b) These statements together present a true and fair view of the state of affairs of the Company and are in
compliance with existing accounting standards, applicable laws and regulations.
2. There are no transactions entered into by the Company during the year which are fraudulent, illegal or violative of
the Company’s Code of Conduct and Ethics.
3. We are responsible for establishing and maintaining internal controls for financial reporting. We evaluated the
effectiveness of internal control systems of the Company pertaining to financial reporting and have disclosed to the
Auditors and Audit Committee, deficiencies in the design or operation of such internal controls, if any, of which we
are aware and steps taken or proposed to be taken for rectifying these deficiencies.
4. We have indicated to the Company’s Auditors and to the Audit Committee that :
a) there are no significant changes in internal control over financial reporting during the year;
b) there are no significant changes in accounting policies during the year; and
c) there are no instances of significant fraud of which we have become aware of that involves management or
other employees who have significant role in the Company’s internal control system over financial reporting.
DEVRAJ LAHIRI
Managing Director
DIN: 03588071
ANISH GUPTA
Chief Financial Officer
Hyderabad, 23rd April, 2019
48
Independent Auditor’s Certificate on the Corporate Governance Report
To The Members of ‘Guidance Note on Audit Reports and Certificates issued

VST Industries Limited for Special Purposes’ issued by the Institute of Chartered
Accountants of India. The Guidance Note requires that
1. This Certificate is issued in accordance with the terms of
we comply with the ethical requirements of the Code of
our engagement letter dated 22 March, 2019.
Ethics issued by the Institute of Chartered Accountants of
2. VST Industries Limited (‘the Company ’) requires India.
Independent Auditor ’s Certificate on Corporate
7. We have complied with the relevant applicable
Governance as per Regulations 17-27, Clauses (b) to (i)
requirements of the Standard on Quality Control (SQC)
of Regulation 46(2) and paragraphs C, D and E of
1, Quality Control for Firms that Perform Audits and
Schedule V of the Securities and Exchange Board of India
Reviews of Historical Financial Information, and Other
(Listing Obligations and Disclosure Requirements)
Assurance and Related Services Engagements.
Regulations, 2015 (‘Listing Regulations’) for the period
1 April, 2018 to 31 March, 2019. Conclusion
Management responsibility 8. In our opinion and to the best of our information and
according to the explanations given to us and
3. The preparation of the Corporate Governance Report is
representations made by the Management, we certify that
the responsibility of the management of the Company
the Company has complied with the conditions of
along with the maintenance of all its relevant supporting
Corporate Governance as specified in Regulations 17-
records and documents. The Management is also
27, Clauses (b) to (i) of Regulation 46(2) and paragraphs
responsible for ensuring that the Company complies with
C, D and E of the Schedule V of the Listing Regulations,
the requirements of Regulations 17-27, Clauses (b) to
as applicable.
(i) of Regulation 46(2) and paragraphs C, D and E of
Schedule V of the Listing Regulations for the period 1st 9. We state that such compliance is neither an assurance as
April, 2018 to 31st March, 2019. This responsibility to the future viability of the Company nor as to the
includes the design, implementation and maintenance efficiency or effectiveness with which the management has
of internal control relevant to the preparation and conducted the affairs of the Company.
presentation of the Corporate Governance report and
Restrictions on Use
applying an appropriate basis of preparation.
10. This Certificate is issued solely for the purpose of complying
Auditor’s Responsibility
with Regulations 17-27, Clauses (b) to (i) of Regulation
4. Pursuant to the requirements of the Listing Regulations, 46(2) and paragraphs C, D and E of Schedule V of the
our responsibility is to certify whether the Company has Listing Regulations for the period 1 April, 2018 to 31
complied with the conditions of Corporate Governance March, 2019 and may not be suitable for any other
as stipulated in Listing Regulations for the period 1st purpose. Accordingly, we do not accept or assume any
April, 2018 to 31st March 2019. liability or duty of care for any other purpose or to any
other person to whom this certificate is shown or into whose
5. We have examined the compliance of the conditions of
hands it may come save where expressly agreed by our
Corporate Governance by the Company for the period
prior consent in writing.
1 April, 2018 to 31 March, 2019 as per Regulations
17-27, Clauses (b) to (i) of Regulation 46(2) and for B S R & ASSOCIATES LLP
paragraphs C, D and E of Schedule V of the Listing Chartered Accountants
Regulations. Our examination was limited to procedures ICAI Firm Registration Number.: 116231W/W-100024
and implementation thereof, adopted by the Company
SRIRAM MAHALINGAM
for ensuring the compliance of the conditions of the
Partner
Corporate Governance. It is neither an audit nor an
Membership Number : 049642
expression of opinion on the financial statements of the
ICAI UDIN Number : 19049642AAAAAF4407
Company.
Place : Hyderabad
6. We conducted our examination in accordance with the Date : 3 May, 2019

73
ANNEXURE B
CORPORATE SOCIAL RESPONSIBILITY POLICY
Purpose
The objective of this Policy is to promote inclusive growth and equitable development of identified areas by contributing
back to the society.
Functions
The main functions of the CSR Committee are as under:
- Identify the areas for carrying out the activities and formulate proposal/plan to undertake;
- To identify the projects, programs for specific area of activity, finalize the budget and earmark the expenditure for
each activity and recommend the same to the Board every year;
- To determine the location where the CSR activities shall be undertaken;
- To monitor the progress of the projects/activities from time to time;
- To nominate employees who will be responsible for implementation, execution and monitoring of the CSR activities;
- To hire services of external service providers, Non-Governmental Organizations, volunteers, professionals, consultants,
specialized agencies etc., if required, to undertake the said activities;
- Such other functions as may be delegated by the Board.
Areas
The Corporate Social Responsibility (CSR) activities shall be undertaken by the Company in any one or more of the following
areas, projects, programs or activities, either new or ongoing or such other areas/activities prescribed by the Companies
Act, 2013 to take forward its commitment towards Social Responsibility:
(i) Eradicating hunger, poverty and malnutrition, promoting preventive health care and sanitation including contribution
to the Swach Bharat Kosh set-up by the Central Government for the promotion of sanitation and making available
safe drinking water;
(ii) Promoting education, including special education and employment enhancing vocation skills especially among
children, women, elderly, and the differently abled and livelihood enhancement projects;
(iii) Promoting gender equality, empowering women, setting up homes and hostels for women and orphans; setting
up old age homes, day care centres and such other facilities for senior citizens and measures for reducing inequalities
faced by socially and economically backward groups;
(iv) Ensuring environmental sustainability, ecological balance, protection of flora and fauna, animal welfare, agroforestry,
conservation of natural resources and maintaining quality of soil, air and water including contribution to the Clean
Ganga Fund set-up by the Central Government for rejuvenation of river Ganga;
(v) Protection of national heritage, art and culture including restoration of buildings and sites of historical importance
and works of art, setting up public libraries, promotion and development of traditional arts and handicrafts;
(vi) Measures for the benefit of armed forces veterans, war widows and their dependents;
(vii) Training to promote rural sports, nationally recognized sports, Paralympic sports and Olympic sports;
(viii) Contribution to the Prime Minister’s National Relief Fund or any other fund set up by the Central Government for
socio-economic development and relief and welfare of the Schedules Castes, the Schedules Tribes, other backward
classes, minorities and women;
50
(ix) Contributions or funds provided to technology incubators located within academic institutions which are approved
by the Central Government; and
(x) Rural development projects.
Investment
The Company shall invest at least two per cent of its average net profits during the three immediately preceding financial
years, towards CSR activities. Any surplus arising out of the CSR activities or project or programs shall not form a part of
business profit of the Company.
Executing Agencies
The Company may undertake the CSR activities either on its own or through a registered trust or a registered society, NGO
or a Company established for this purpose. However, no Director or Key Managerial Personnel or their relatives shall have
substantial interest in such, trust, society NGO or Company. The Company may also collaborate with other companies for
undertaking the projects/programs in accordance with the Rules.
Audit
The CSR activities and the expenditure thereon shall be audited by an external auditor who may be appointed by the
Committee.
Reporting
The Committee may appoint any executive(s) to monitor the activities and report back to the Committee periodically. The
executive(s) shall also ensure that the utilization of funds on such projects and programs are in line with the agreed CSR
activities and place its detailed report periodically before the CSR Committee. The Committee shall give a detailed report of
the CSR activities to the Board of Directors every year. The Board shall disclose the details of the Policy in its report and the
same shall also be placed on the Company’s website.

73
ANNUAL REPORT ON CSR ACTIVITIES

1. The web link to the CSR Policy is www.vsthyd.com/i/CSRPolicy.pdf.
2. The Composition of the CSR Committee : Ms. Mubeen Rafat (Chairperson), Mr. Pradeep V. Bhide, Mr. S. Thirumalai and
Mr. Devraj Lahiri.
3. Average net profit of the company for last three financial years : ` 24,787.74 lakhs
4. Prescribed CSR Expenditure : Two per cent of the amount mentioned in item 3 above : ` 495.75 lakhs
5. Details of CSR spent during the financial year:
(a) Total amount to be spent for the financial year: ` 495.75 lakhs
(b) Amount unspent, if any: Nil
(c) Manner in which the amount spent during the financial year is detailed below.
S. CSR project or Sector in Projects or Amount Amount spent on Cumul- Amount

No activity which the Programs outlay the projects or ative spent: Direct
identified Project is (1) Local area or (budget) Programmes expenditure or through
covered other project Subheads: upto the implementing
(2) Specify the State or (1) Direct reporting agency
and district where programmes Expenditure on period
projects or wise projects or
programmes programmes.
was undertaken (2) Overheads:
(` Lakhs) (` Lakhs) (` Lakhs)
1 Swachh Ghar Sanitation In districts of 276.00 276.00 276.00 Implementing
Mission: Creating Jogulamba Gadwal agency
awareness on nexus in the State of
between health and Telangana
hygiene and
construction of
household toilets.
2 Swachh Roshni : Environment In districts of 54.65 54.65 54.65 Implementing
Solar Street Lighting Sustainability
Jogulamba Gadwal, agency
Wanaparthy Nizamabad,
Adilabad and
Kamareddy in the
State of Telangana
3 Project Haritha : Environment Hyderabad in the 100.40 100.40 100.40 Implementing
Tree Plantation Sustainability State of Telangana agency and in
association with
Greater Hyderabad
Municipal
Corporation
4 Project Gyandeep : P r o m o t i n g Hyderabad in the 24.70 24.70 24.70 Implementing
School Infrastructure education State of Telangana agency
5 Mid-Day Meal Eradicating In districts of 40.00 40.00 40.00 Implementing
hunger and Sangareddy, Vikarabad agency
poverty and Medak in the State
of Telangana
TOTAL 495.75 495.75 495.75
52
RESPONSIBILITY STATEMENT
The CSR committee of the Company hereby confirms that the implementation and monitoring of CSR Policy is in compliance
with CSR objectives and policy of the Company.
MUBEEN RAFAT DEVRAJ LAHIRI

Chairperson Managing Director
CSR Committee DIN: 03588071
DIN: 02097314

73
ANNEXURE C
DIVIDEND DISTRIBUTION POLICY
Purpose
The distribution policy defines the Company’s philosophy of sharing its earnings with the shareholders.
Policy
The Board has adopted a progressive dividend distribution policy, based on the principle that the total dividend distributed
should be in line with the earnings trend, while taking into account the Company’s financial position as well as future capital
expenditure needs for machinery replacement and incremental working capital. In addition changes in macro environment
including taxation and regulatory changes will also be considered. Currently, dividend distribution tax is also payable.
The above factors should be considered by the Board before making any recommendations for the dividend and are
subject to the provisions of the Companies Act, 2013.
The Company’s payout ratio is around 70% of Company’s net profit before extraordinary/exceptional item. Based on the
financial position and funds requirement of the Company, the dividend distribution to the shareholders could be enhanced
or on the other hand, in periods of uncertainty a lower dividend ratio could be appropriate.
Dividends are declared at the Annual General Meeting of the shareholders based on the recommendation by the Board.
The Board may also declare an interim dividend.
The retained earnings after distribution of dividend shall be utilized by the Company to meet its capital expenditure plan,
working capital requirements and other business expansion plans.
Therefore, in setting the dividend policy, the Board’s aim is to continue to strike a balance between the interests of the
business and its shareholders.
54
ANNEXURE D
FORM No. AOC-2

[Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014]
Disclosure of particulars of contracts/arrangements entered into by the company with related parties
referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arms
length transactions under third proviso thereto.
1. Details of contracts or arrangements or transactions not at arm’s length basis : Nil

(a) Name(s) of the related party and nature of relationship
(b) Nature of contracts/arrangements/transactions
(c) Duration of the contracts/arrangements/transactions
(d) Salient terms of the contracts or arrangements or transactions including the value, if any
(e) Justification for entering into such contracts or arrangements or transactions
(f) date(s) of approval by the Board
(g) Amount paid as advances, if any
(h) Date on which the special resolution was passed in general meeting as required under first proviso to Section 188
2. Details of material contracts or arrangement or transactions at arm’s length basis : Nil

(a) Name(s) of the related party and nature of relationship
(b) Nature of contracts/arrangements/transactions
(c) Duration of the contracts/arrangements/transactions
(d) Salient terms of the contracts or arrangements or transactions including the value, if any:
(e) Date(s) of approval by the Board, if any
(f) Amount paid as advances, if any : Please refer the note given below*
* The details of transactions between the Company and its related parties, names, nature of such contracts/arrangements/
transactions and other details are set out in Notes to the Financial Statements under Serial No.29.
On behalf of the Board
PRADEEP V. BHIDE
Chairman
DIN: 03304262
Hyderabad, 3rd May, 2019

73
ANNEXURE E
Particulars of employees pursuant to Section 134(3)(q) of Companies Act, 2013 read with Rule 5(1)
of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and amendments
thereof
Requirements of Rule 5(1) Details

#
i) Ratio of remuneration of each Director to the median Mr. Raymond S. Noronha NA
remuneration of the employees of the company for the Mr. Pradeep V. Bhide 9:1
financial year 2018-19
Mr. S. Thirumalai 6:1
Ms. Mubeen Rafat 5:1
Mr. Devraj Lahiri 32:1
Mr. Ramakrishna V Addanki NA
Mr. Naresh Kumar Sethi NA
ii) The percentage increase in remuneration of each Director, Directors
Chief Financial Officer, Chief Executive Officer, Company Mr. Raymond S. Noronha #
NA
Secretary or Manager, if any, in the financial year 2018-
Mr. Pradeep V. Bhide $ NA
19
Mr. S. Thirumalai 41.7%
Ms. Mubeen Rafat 31.9%
Mr. Ramakrishna V Addanki NA
Mr. Naresh Kumar Sethi NA
Key Managerial Personnel
Mr. Devraj Lahiri 42.3%
Mr. Anish Gupta 15.4%
Mr. Phani K. Mangipudi 35.8%
iii) The percentage increase in the median remuneration of 4.9%

employees in the financial year 2018-19
iv) The number of permanent employees on the rolls of 782
Company as on 31st March, 2019
v) Average percentile increase already made in the salaries Average increase in the salaries of employees other than
of employees other than the managerial personnel in the managerial personnel in the financial year 2018-19
the last financial year and its comparison with the was 2.9% in comparison with 1.7% increase in the
percentile increase in the managerial remuneration and managerial remuneration
justification thereof and point out if there are any
exceptional circumstances for increase in the managerial
remuneration
vi) Affirmation that the remuneration is as per the Remuneration paid/payable during the financial year 2018-
remuneration policy of the company 19 is as per the Remuneration Policy of the Company.
#
Mr. Raymond S. Noronha resigned as Director with effect from the closing of the business hours on 12th April, 2018. As
he was not in appointment for the full financial year, comparative details are not being provided.
$
Mr. Pradeep V. Bhide was appointed as Director with effect from 12th April, 2018. As the appointment was not for the
full previous financial year, comparative details are not being provided.
56
ANNEXURE F
FORM NO. MGT-9

EXTRACT OF ANNUAL RETURN
as on the financial year ended on 31st March, 2019
[Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies
[Management and Administration] Rules, 2014]
I. REGISTRATION AND OTHER DETAILS

1. CIN L29150TG1930PLC000576
2. Registration Date 10th November, 1930
3. Name of the Company VST Industries Limited
4. Category of the Company Public Company
5. Sub-category of the Company Company having share capital
6. Registered Office Address of the 1-7-1063/1065, Azamabad
Company & contact details Hyderabad – 500 020, Telangana, India
Telephone : +91 40 2768 8000
Fax: +91 40 2761 5336
Website: www.vsthyd.com
Email: investors@vstind.com
7. Whether Listed Company Yes
8. Name and address of Registrar & Karvy Fintech Private Limited
Transfer Agents and contact details Karvy Selenium Tower B, Plot No.31&32,
Financial District, Nanakramguda,
Hyderabad – 500 032, Telangana, India
Tel: +91 40 67162222
Fax:+91 40 23420814
Email: einwardris@karvy.com
II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

(All the business activities contributing 10% or more of the total turnover of the Company shall be stated)
Sl.No. Name and Description of main products/services NIC Code of the % to total turnover of
Product/service the Company
1 Cigarettes containing tobacco 12003 79.80%

2 Unmanufactured Tobacco 46202 20.20%
III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES
Sl.No. Name and Address of the CIN/GLN Holding/Subsidiary/ % of shares held Applicable
Company Associate Section
- - - - - -

73
ANNEXURE F
IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)
(i) Category-wise Share Holding
No. of Shares held at the beginning of the year No. of Shares held at the end of the year
[As at 1st April, 2018] [As at 31st March, 2019]
% Change
Category of Shareholders Demat Physical Total % of Total Demat Physical Total % of Total during
Shares Shares the year
A. Promoters
(1) Indian
(a) Individual/HUF 0 0 0 0.00 0 0 0 0.00 0.00
(b) Central Government/ 0 0 0 0.00 0 0 0 0.00 0.00
State Government(s)
(c) Bodies Corporate 0 0 0 0.00 0 0 0 0.00 0.00
(d) Financial Institutions/Banks 0 0 0 0.00 0 0 0 0.00 0.00
(e) Others 0 0 0 0.00 0 0 0 0.00 0.00
Sub-Total A(1) : 0 0 0 0.00 0 0 0 0.00 0.00
(2) FOREIGN
(a) Individuals (NRIs/ 0 0 0 0.00 0 0 0 0.00 0.00
Foreign Individuals)
(b) Bodies Corporate 49,65,902 0 49,65,902 32.16 49,65,902 0 49,65,902 32.16 0.00
(c) Banks/FI 0 0 0 0.00 0 0 0 0.00 0.00
(d) Any others 0 0 0 0.00 0 0 0 0.00 0.00
Sub-Total A(2) : 49,65,902 0 49,65,902 32.16 49,65,902 0 49,65,902 32.16 0.00
Total Shareholding of Promoter
(A)=A(1)+A(2) 49,65,902 0 49,65,902 32.16 49,65,902 0 49,65,902 32.16 0.00
(B) PUBLIC SHAREHOLDING
(1) INSTITUTIONS
(a) Mutual Funds /UTI 19,86,448 250 19,86,698 12.87 25,01,750 250 25,02,000 16.20 3.34
(b) Financial Institutions/Banks 9,749 4,394 14,143 0.09 10,047 4,394 14,441 0.09 0.00
(c) Central Government/ 0 0 0 0.00 0 0 0 0.00 0.00
State Government(s)
(d) Venture Capital Funds 0 0 0 0.00 0 0 0 0.00 0.00
(e) Insurance Companies 3,04,092 9,750 3,13,842 2.03 2,35,721 9,750 2,45,471 1.59 -0.44
(f) Foreign Institutional Investors 14,67,296 50 14,67,346 9.50 13,69,514 50 13,69,564 8.87 -0.63
(g) Foreign Venture Capital Investors 0 0 0 0.00 0 0 0 0.00 0.00
(h) Others (Specify) 0 0 0 0.00 0 0 0 0.00 0.00
Sub-Total B(1) : 37,67,585 14444 37,82,029 24.49 41,17,032 14,444 41,31,476 26.75 2.26
(2) NON-INSTITUTIONS
(a) Bodies Corporate 45,64,638 3,831 45,68,469 29.58 42,18,512 3,181 42,21,693 27.34 -2.25
(b) Individuals
(i) Individuals holding 12,81,217 3,85,597 16,66,814 10.79 12,81,755 3,49,142 16,30,897 10.56 -0.23
nominal share capital
upto Rs.1 lakh
(ii) Individuals holding 1,26,868 41,781 1,68,649 1.09 1,36,757 41,781 1,78,538 1.16 0.06
nominal share capital in
excess of Rs.1 lakh
(c) Others 1,68,885 1,21,172 2,90,057 1.88 1,92,242 1,21,172 3,13,414 2.03 0.14
Sub-Total B(2) : 61,41,608 5,52,381 66,93,989 43.35 58,29,266 5,15,276 63,44,542 41.09 -2.26
Total B=B(1)+B(2) : 99,09,193 5,66,825 1,04,76,018 67.84 99,46,298 5,29,720 1,04,76,018 67.84 0.00
Total (A+B) : 1,48,75,095 5,66,825 1,54,41,920 100.00 1,49,12,200 5,29,720 1,54,41,920 100.00 0.00
(C) Shares held by custodians for
GDR's & ADR's
GRAND TOTAL (A+B+C) : 1,48,75,095 5,66,825 1,54,41,920 100.00 1,49,12,200 5,29,720 1,54,41,920 100.00
58
ANNEXURE F
ii) Shareholding of Promoters

Shareholding at the beginning of the year Shareholding at the end of the year
(As at 1st April, 2018) (As at 31st March, 2019)
% change
Sl. Shareholder’s Name No. of Shares % of total Shares % of Shares No. of Shares % of total Shares % of Shares in share
No. of the Company Pledged / of the Company Pledged / holding
encumbered to encumbered to during the
total shares total shares year
1 The Raleigh Investment
Company Limited 36,20,420 23.45 0 36,20,420 23.45 0 0
2 Tobacco Manufacturers 12,78,942 8.28 0 12,78,942 8.28 0 0
(India) Limited
3 Rothmans International 66,540 0.43 0 66,540 0.43 0 0
Enterprises Limited
Total 49,65,902 32.16 0 49,65,902 32.16 0 0
iii) Change in Promoters’ Shareholding

Shareholding at the beginning Cumulative Shareholding during the
of the year year 1st April, 2018 to
(As at 1st April, 2018) 31st March, 2019
No. of shares % of total No. of shares % of total
shares of the shares of the
Company Company
At the beginning of the year 49,65,902 32.16 49,65,902 32.16
Date wise increase/decrease in
promoters shareholding during the year
specifying the reasons for increase/ No change
decrease (e.g. allotment/transfer/
bonus/sweat equity, etc):
- - - -
At the end of the year 49,65,902 32.16 49,65,902 32.16

73
ANNEXURE F
iv) Shareholding Pattern of top ten Shareholders: (other than Directors, Promoters and holders of GDRs and ADRs):
Sl. Shareholding at the Increase/ Cumulative Shareholding

beginning of the year Decrease in during the year
No. Name Date Reason
(As at 1st April, 2018) shareholding 1st April, 2018 to
31st March, 2019
No. of shares % of total No. of % of total
shares of shares shares of
the the
Company Company
1 Bright Star Investments 40,07,118 25.95 - - Nil 40,07,118 25.95

Private Limited movement
2 HDFC Trustee Company 13,71,722 8.88 08.06.2018 2,73,706 Transfer 16,45,428 10.66
Limited (Multiple Funds) 08.06.2018 -2,73,706 Transfer 13,71,722 8.88
21.09.2018 415 Transfer 13,72,137 8.89
3 Matthews India Fund 11,67,175 7.56 - - Nil 11,67,175 7.56

movement
4 DSP Equity & Bond Fund 4,23,610 2.74 04.05.2018 63,000 Transfer 4,86,610 3.15
27.07.2018 69,052 Transfer 5,55,662 3.60
07.09.2018 6,907 Transfer 5,62,569 3.64
14.09.2018 2,615 Transfer 5,65,184 3.66
21.09.2018 2,232 Transfer 5,67,416 3.67
02.11.2018 362 Transfer 5,67,778 3.68
23.11.2018 5,393 Transfer 5,73,171 3.71
30.11.2018 3,251 Transfer 5,76,422 3.73
07.12.2018 11,729 Transfer 5,88,151 3.81
14.12.2018 677 Transfer 5,88,828 3.81
21.12.2018 1,350 Transfer 5,90,178 3.82
5 ICICI Lombard General 3,02,100 1.96 27.04.2018 -72,049 Transfer 2,30,051 1.49
Insurance Company 06.07.2018 -476 Transfer 2,29,575 1.49
Limited # 13.07.2018 -28,967 Transfer 2,00,608 1.30
20.07.2018 -30,448 Transfer 1,70,160 1.10
27.07.2018 -85,580 Transfer 84,580 0.55
03.08.2018 -55,560 Transfer 29,020 0.19
10.08.2018 -29,020 Transfer - -
6 The New India Assurance 2,35,721 1.53 - - Nil 2,35,721 1.53

Company Limited Movement
7 TATA India Consumer 0 0.00 07.12.2018 10,100 Transfer 10,100 0.07

Fund 21.12.2018 66,000 Transfer 76,100 0.49
28.12.2018 27,667 Transfer 1,03,767 0.67
11.01.2019 5,325 Transfer 1,09,092 0.71
01.02.2019 11,000 Transfer 1,20,092 0.78
08.02.2019 39,000 Transfer 1,59,092 1.03
8 L&T Mutual Fund Trustee 0 0.00 25.01.2019 15,000 Transfer 15,000 0.10
Limited-l&T Emerging 01.02.2019 17,897 Transfer 32,897 0.21
Business 08.02.2019 13,437 Transfer 46,334 0.30
15.02.2019 6,753 Transfer 53,087 0.34
22.02.2019 18,489 Transfer 71,576 0.46
01.03.2019 5,520 Transfer 77,096 0.50
08.03.2019 1,504 Transfer 78,600 0.51
22.03.2019 318 Transfer 78,918 0.51
29.03.2019 58,075 Transfer 1,36,993 0.89
60
ANNEXURE F
Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and holders of GDRs and ADRs) (Continued)
Sl. Shareholding at the Increase/ Cumulative Shareholding

beginning of the year Decrease in during the year
No. Name Date Reason 1st April, 2018 to
(As at 1st April, 2018) shareholding
31st March, 2019
No. of shares % of total No. of % of total
shares of shares shares of
the the
Company Company
9 IDBI Equity Advantage Fund 115621 0.75 27.04.2018 -131 Transfer 115490 0.75
04.05.2018 -256 Transfer 115234 0.75
11.05.2018 -457 Transfer 114777 0.74
18.05.2018 -1045 Transfer 113732 0.74
01.06.2018 -260 Transfer 113472 0.73
20.07.2018 -305 Transfer 113167 0.73
03.08.2018 -2457 Transfer 110710 0.72
31.08.2018 -506 Transfer 110204 0.71
07.09.2018 -363 Transfer 109841 0.71
14.09.2018 -822 Transfer 109019 0.71
05.10.2018 -87 Transfer 108932 0.71
08.03.2019 -10000 Transfer 98932 0.64
15.03.2019 10000 Transfer 108932 0.71
10 TATA Investment 85276 0.55 14.09.2018 85276 Transfer 170552 1.10
Corporation Limited 14.09.2018 -85276 Transfer 85276 0.55
11 Investor Education and 82579 0.53 12.10.2018 404 Transfer 82983 0.54
Protection Fund Authority 26.10.2018 10236 Transfer 93219 0.60
# Ceased to be in the list of Top 10 shareholders as on 31st March, 2019. The same is reflected above since the
shareholder was one of the Top 10 shareholders as on 1st April, 2018.
v) Shareholding of Directors and Key Managerial Personnel
Shareholding at the beginning Cumulative Shareholding during the
of the year Year
Sl No. For each of the Directors and Key (As at 1st April, 2018) 1st April, 2018 to 31st March, 2019
Managerial Personnel
No. of shares % of total shares of No. of shares % of total shares
DIRECTORS the Company of the Company
1 Mr. Raymond S Noronha* - - - -
2 Mr. Pradeep V. Bhide$ - - - -
3 Mr. S. Thirumalai 25 0.00 25 0.00
4 Ms. Mubeen Rafat - - - -
5 Mr. Ramakrishna V. Addanki! - - - -
6 Mr. Naresh Kumar Sethi~ - - - -
KEY MANAGERIAL PERSONNEL
1 Mr. Devraj Lahiri [Managing Director] - - - -
2 Mr. Anish Gupta - - - -
[Chief Financial Officer]
3 Mr. Phani K. Mangipudi 1 0.00 1 0.00
[Company Secretary]
*
Ceased to be the Director from close of working hours on 12th April, 2018
$
Appointed as Additional Director with effect from 12th April, 2018
!
Ceased to be the Director w.e.f 14th December, 2018
~
Appointed as Nominee Director w.e.f 14th December, 2018

73
ANNEXURE F
V. INDEBTEDNESS
Indebtedness 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 year
i) Principal Amount
ii) Interest due but not paid
iii) Interest accrued but not due
Total (i+ii+iii)
Change in Indebtedness during the
L
financial year NI
• Addition
• Reduction
Net Change
Indebtedness at the end of the
financial year
i) Principal Amount
ii) Interest due but not paid
iii) Interest accrued but not due
Total (i+ii+iii)
VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to Managing Director, Wholetime Directors and/or Manager
Devraj Lahiri
Total Amount
Particulars of Remuneration Managing Director
Sl No.
` `
1 Gross salary
(a) Salary as per provisions contained in Section 17(1)
of the Income Tax Act, 1961 2,32,29,182 2,32,29,182
(b) Value of perquisites under Section 17(2) of the Income Tax Act, 1961 4,55,830 4,55,830
(c) Profits in lieu of salary under Section 17(3) of the Income Tax Act, 1961 - -
2 Stock Option - -
3 Sweat Equity - -
4 Commission - -
- as % of profit
- others
5 Others (Retirals) 19,28,651 19,28,651
Total (A) 2,56,13,663 2,56,13,663
Ceiling as per the Act [@5% of profits calculated under
Section 198 of the Companies Act, 2013] 17,31,83,392
62
ANNEXURE F
B. Remuneration to other Directors

Sl No. Particulars of Remuneration Name of Directors
Total Amount
1 Independent Directors Mr. S. Ms. Mubeen
Thirumalai Rafat
` ` `
Fee for attending Board/ 9,25,000 9,25,000 18,50,000
Committee Meetings
Commission 40,00,000 30,00,000 70,00,000
Others - - -
TOTAL [1] 49,25,000 39,25,000 88,50,000
2 Other Non-Executive Directors Mr. R.S. Noronha Mr. Pradeep Mr. Ramakrishna Mr. Naresh
V. Bhide V. Addanki Kumar Sethi
Fee for attending Board/ 1,25,000 6,65,000 - - 7,90,000

Committee Meetings
Commission - 65,00,000 - - 65,00,000
Others - - - - -
Total [2] 1,25,000 71,65,000 - - 72,90,000
Total [B] = [1+2] 50,50,000 1,10,90,000 - - 1,61,40,000
Total managerial remuneration [A+B] 4,17,53,663
Overall ceiling as per the Act [@ 6%
of profits calculated under Section 198
of the Companies Act, 2013] 20,78,20,069
C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD

Sl No. Particulars of Remuneration Key Managerial Personnel
Anish Gupta Phani K. Mangipudi Total Amount
CFO Company Secretary
1 Gross salary ` ` `
(a) Salary as per provisions contained in 76,33,956 53,67,928 1,30,01,884
Section 17(1) of the Income Tax Act, 1961
(b) Value of perquisites under Section 17(2) 65,038 36,621 1,01,659
Income Tax Act, 1961
(c) Profits in lieu of salary under - - -
Section 17(3) Income Tax Act, 1961
2 Stock Option - - -
3 Sweat Equity - - -
4 Commission
- as % of profit - - -
- others - - -
5 Others (Retirals) 5,22,975 2,40,106 7,63,081
TOTAL 82,21,969 56,44,655 1,38,66,624

73
ANNEXURE F
VII.PENALTIES/PUNISHMENT/COMPOUNDING OF OFFENCES
Type Section of the Brief Details of Penalty Authority Appeal made,
Companies Act Description /Punishment/ [RD/NCLT/ if any
Compounding Court]
fees imposed
A. COMPANY
Penalty
Punishment
Compounding
B. DIRECTORS
Penalty L
NI
Punishment
Compounding
C. OTHER OFFICERS
IN DEFAULT
Penalty
Punishment
Compounding
64
ANNEXURE G
SECRETARIAL AUDIT REPORT
For the Financial Year Ended 31 March, 2019

[Pursuant to Section 204(1) of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014]
The Members (v) The following Regulations and Guidelines prescribed

VST Industries Limited under the Securities and Exchange Board of India
Azamabad Act, 1992 (‘SEBI Act’):
Hyderabad – 500 020 (a) The Securities and Exchange Board of India
I have conducted the Secretarial Audit of the compliance of (Substantial Acquisition of Shares and Takeovers)
applicable statutory provisions and the adherence to good Regulations, 2011;
corporate practices by VST Industries Limited (hereinafter (b) The Securities and Exchange Board of India
called “the Company”). Secretarial Audit was conducted in (Prohibition of Insider Trading) Regulations,
a manner that provided me a reasonable basis for evaluating 2015;
the corporate conducts/statutory compliances and expressing
(c) The Securities and Exchange Board of India
my opinion thereon.
(Issue of Capital and Disclosure Requirements)
Based on my verification of the Company’s books, papers, Regulations, 2009 and 2018 (Not applicable to
minute books, forms and returns filed and other records the Company during the Audit Period);
maintained by the Company and also the information (d) The Securities and Exchange Board of India
provided by the Company, its officers, agents and authorized (Share Based Employee Benefits) Regulations,
representatives during the conduct of Secretarial Audit, I 2014 (Not applicable to the Company during
hereby report that in my opinion, the Company has, during the Audit Period);
the audit period covering the financial year ended on 31
March, 2019 (‘Audit Period’) complied with the statutory (e) The Securities and Exchange Board of India
provisions listed hereunder and also that the Company has (Issue and Listing of Debt Securities) Regulations,
proper Board-processes and compliance-mechanism in 2008 (Not applicable to the Company during
place to the extent, in the manner and subject to the reporting the Audit Period);
made hereinafter: (f) The Securities and Exchange Board of India
(Registrars to an Issue and Share Transfer Agents)
I have examined the books, papers, minute books, forms
Regulations, 1993 regarding the Companies Act
and returns filed and other records maintained by the
and dealing with client;
Company for the financial year ended on 31 March, 2019
according to the provisions of: (g) The Securities and Exchange Board of India
(Delisting of Equity Shares) Regulations, 2009
(i) The Companies Act, 2013 (the Act) and the rules
(Not applicable to the Company during the Audit
made thereunder;
Period); and
(ii) The Securities Contracts (Regulation) Act, 1956 (h) The Securities and Exchange Board of India
(‘SCRA’) and the rules made thereunder; (Buyback of Securities) Regulations, 1998 and
(iii) The Depositories Act, 1996 and the Regulations and 2018 (Not applicable to the Company during
Bye-laws framed thereunder; the Audit Period).
(iv) Foreign Exchange Management Act, 1999 and the (vi) I further report that, having regard to the compliance
rules and regulations made thereunder to the extent system prevailing in the Company and on
of Foreign Direct Investment, Overseas Direct examination of the relevant documents and records
Investment and External Commercial Borrowings in pursuance thereof on test-check basis, the
(Not applicable to the Company during the Audit Company has complied with the following laws
Period); applicable specifically to the Company:

73
(a) The Tobacco Board Act, 1975 and Rules made compliance with the provisions of the Act.
thereunder; and
Adequate notice is given to all directors to schedule the
(b) The Cigarette and Other Tobacco Products Board Meetings, agenda and detailed notes on agenda
(Prohibition of Advertisement and Regulation of were generally sent at least seven days in advance, and
Trade and Commerce, Production, Supply and a system exists for seeking and obtaining further
Distribution) Act, 2003 and Rules made information and clarifications on the agenda items
thereunder. before the meeting and for meaningful participation at
I have also examined compliance with the applicable clauses the meeting.
of the following: All decisions at Board Meetings and Committee Meetings
(i) Secretarial Standards (SS-1 and SS-2) issued by The were carried out unanimously as recorded in the minutes
Institute of Company Secretaries of India; and of the meetings of the Board of Directors or Committees
(ii) The Securities and Exchange Board of India (Listing of the Board, as the case may be.
Obligations and Disclosure Requirements) I further report that there are adequate systems and processes
Regulations, 2015. in the Company commensurate with the size and operations
During the period under review the Company has complied of the Company to monitor and ensure compliance with
with the provisions of the Act, Rules, Regulations, Guidelines, applicable laws, rules, regulations and guidelines.
Standards, etc. mentioned above. I further report that during the audit period there were no
I further report that specific events/actions having a major bearing on the
The Board of Directors of the Company is duly constituted company’s affairs in pursuance of the above referred laws,
with proper balance of Executive Directors, Non-Executive rules, regulations, guidelines, standards.
Directors and Independent Directors. The changes in Dr. K. R. CHANDRATRE
the composition of the Board of Directors that took place FCS No.: 1370, C P No.: 5144
during the period under review were carried out in Pune, 3rd May, 2019
This report is to be read with my letter of even date which is

annexed as Annexure and forms an integral part of this
report.
66
ANNEXURE TO THE
The Members, 3. I have not verified the correctness and appropriateness

VST Industries Limited, of financial records and books of accounts of the
Azamabad, Company.
4. Wherever required, I have obtained Management
My report of even date is to be read along with this letter: Representation about the compliance of laws, rules and
regulations and happening of events, etc.
1 Maintenance of secretarial records is the responsibility
of the management of the Company. My responsibility 5. The compliance of the provisions of corporate and other
is to express an opinion on these secretarial records applicable laws, rules, regulations, standards is the
based on my audit. responsibility of management. My examination was
limited to the verification of procedures on test-check
2. I have followed the audit practices and processes as
basis.
were appropriate to obtain reasonable assurance about
the correctness of the contents of the secretarial records. 6. The Secretarial Audit report is neither an assurance as
The verification was done on test-check basis to ensure to future viability of the Company nor of the efficacy or
that correct facts are reflected in secretarial records. I effectiveness with which the management has conducted
believe that the process and practices, I followed provide the affairs of the Company.
a reasonable basis for my opinion.
Dr. K. R. CHANDRATRE
FCS No.: 1370, C P No.: 5144
Pune, 3rd May, 2019

73
ANNEXURE H
Information under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) 2014
and forming part of the Directors' Report for the year ended 31st March, 2019.
A. CONSERVATION OF ENERGY
1. 2% energy saved in DRF’s & PF’s By carrying Machine wise Suction line balancing, air audit was carried out & measures
taken resulting in 3% energy saving.
2. Distribution Line losses reduced from 2.1% to 1.8% in Azamabad plant by Proper design of power Distribution network.
3. 5% overall plant energy consumption reduced in the financial year 2018-19 compared to financial year 2017-18 by
continuous tracking day to day consumption and analysis.
4. Conducted energy conservation awareness program for 305 employees.
5. Reduced the SMD energy consumption this year by 4% compared to financial year 2017-18 by analyzing the machine
wise day to day consumption.
B. TECHNOLOGY ABSORPTION
(i) Efforts made towards technology absorption
a. New case packer for high speed packer
i. Benefit – Improved quality and productivity
b. One packer converted to Bevel Edge Pack format
i. Benefit – Contemporary pack in market
c. Three packers converted to RSFT EP format
i. Benefit - Contemporary pack in market
ii. In case of imported technology (imported during the last three years reckoned from the beginning of the
financial year) :
Year Details of technology imported Whether absorbed
2015-16 Contemporary cigarette making machine; Yes
2016-17 New CRS drier & silos for PMD at Toopran Yes
2017-18 Quantum Cigarette Density profile tester, Yes
Cigarette PD & Ventilation Quality Test Module Yes
(ii) Expenditure incurred on Research and Development ` Lakhs
- On capital account 300.92
- On revenue account 681.48
982.40
as a % of Gross Turnover 0.83
C. FOREIGN EXCHANGE EARNINGS AND OUTGO
Foreign Exchange earned in terms of actual inflows during the year and the foreign exchange outgo during the year in
terms of actual outflows.
` Lakhs
Total foreign exchange used
Raw Materials 2534.78
Spare Parts 38.55
Capital Goods 264.97
Travel, Advertisement,etc 23.90
Dividends Paid 3848.57
6710.77
Total Foreign Exchange Earned
Tobacco - CIF 14755.23
14755.23
Tobacco - FOB 14706.18
14706.18
68
BUSINESS RESPONSIBILITY REPORT
[Pursuant to Regulation 34(2)(f) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015]
SECTION A : GENERAL INFORMATION ABOUT THE COMPANY
1. Corporate Identity Number (CIN) of the Company L29150TG1930PLC000576

2. Name of the Company VST Industries Limited
3. Registered address 1-7-1063/1065, Azamabad, Hyderabad – 500 020
4. Website www.vsthyd.com
5. E-mail id investors@vstind.com
6. Financial Year reported April 2018 to March, 2019
7. Sector(s) that the Company is engaged in Manufacturing of cigarettes containing tobacco
(industrial activity code-wise) (12003) and unmanufactured tobacco (46202)
8. List three key products/services that the Company Cigarettes containing tobacco & Unmanufactured tobacco
manufactures/provides (as in balance sheet)
9. Total number of locations where business activity is (a) Number of international locations : Nil
undertaken by the Company
(b) Number of national locations: VST has its Registered
Office and regional office in Hyderabad and its
factories at Hyderabad and Toopran. It also has
regional offices at Delhi, Mumbai, Kolkata, Chennai
and Guwahati.
10. Markets served by the Company Local/State/National/International :

National & International
SECTION B : FINANCIAL DETAILS OF THE COMPANY

1. Paid up Capital ` 15,44,19,200
2. Turnover ` 1,22,301 lakhs
3. Total Profit after taxes ` 22,684 lakhs
4. Total Spending on Corporate Social Responsibility 2%
(CSR) as percentage of profit after tax (%)
5. List of activities in which expenditure in (a) Swachh Ghar Mission –
4 above has been incurred Construction of household toilets
(b) Solar Street Lighting
SECTION C : OTHER DETAILS

1. Does the Company have any subsidiary No
company/companies
2. Do the subsidiary company/companies participate NA
in the BR initiatives of the parent company ? If yes,
then indicate the number of such subsidiary company(s)
3. Do any other entity/entities (e.g. suppliers, distributors No
etc.) that the Company does business with, participate
in the BR initiatives of the Company

73
SECTION D : BR INFORMATION
1. Details of Directors / persons responsible for BR The Corporate Social Responsibility Committee comprises
of Ms. Mubeen Rafat (DIN 02097314) as the Chairpeson,
Mr. Pradeep V. Bhide, Mr. S. Thirumalai and Mr. Devraj Lahiri.
Mr. S. Sriram, Vice President-HR is responsible for executing

CSR in the Company. Telephone : +91 040 2768 8000,
E-mail : shriram@vstind.com
The role of Corporate Social Responsibility Committee is as

follows :
● Identify the areas for carrying out the activities and
formulate policy to undertake the same;
● Identify the projects, programs for specific area of activity,
finalise the budget and earmark the expenditure for each
activity and recommend the same to the Board every year;
● To determine the location where CSR activities shall be
undertaken;
● To monitor the progress of the projects/activities from time
to time;
● To nominate employees who shall be responsible for
implementation, execution and monitoring of CSR
activities;
● To hire wherever required services of external service
providers, Non-Governmental Organisations (NGOs),
volunteers, professionals, consultants, specialized
agencies, etc. if required, to undertake and audit such
activities.
2. The operating principles adopted by the Company The National Voluntary Guidelines provide for the following
supplement the requirements under the nine principles.
National Voluntary Guidelines Principle 1 : Ethics, Transparency and Accountability [P1]
Principle 2 : Products Lifecycle Sustainability [P2]
Principle 3 : Employees’ Well-being [P3]
Principle 4 : Stakeholder Engagement [P4]
Principle 5 : Human Rights [P5]
Principle 6 : Environment [P6]
Principle 7 : Policy Advocacy [P7]
Principle 8 : Inclusive Growth [P8]
Principle 9 : Customer Value [P9}
(Contd.)
70
Details of compliance (Reply in Yes/No)

No. Questions P1 P2 P3 P4 P5 P6 P7 P8 P9
1. Do you have a policy/policies for : Yes Yes Yes Yes Yes Yes Yes Yes Yes
2. Has the policy being formulated in Yes
consultation with the relevant
stakeholders?
3. Does the policy conform to any national/ The Policies are aligned to the legal requirements and are also in compliance
international standards? as per the ISO and Occupational Health and Safety Assessment System.
4. Has the policy being approved by the The policies are noted by the Board of Directors of the Company.
Board? If yes, has it been signed by MD/ Implementation of policy decision is carried out by the management.
Owner/CEO/appropriate Board Director?
5. Does the company have a specified The implementation and adherence to the Code of Conduct for
committee of the Board/Director/Official employees is overseen by the Human Resource function. The Corporate
to oversee the implementation of the Social Responsibility Policy is administered by the CSR Committee in
policy? line with requirements of the Companies Act, 2013 and the Employee
Health and Safety (EHS) practices are overseen by the management.
6. Indicate the link for the policy to be viewed Policies which are internal to the Company are available on the intranet portal
online? of the Company. Other policies are available on the website of the Company,
www.vsthyd.com.
7. Has the policy been formally Yes
communicated to all relevant internal and
external stakeholders?
8. Does the company have in-house structure Yes
to implement the policy/policies?
9. Does the company have a grievance Yes
redressal mechanism related to the policy/
policies to address stakeholders’
grievances related to the policy/policies?
10. Has the company carried out independent No, your Company has not carried out independent audit of the policies. The
audit/evaluation of the working of this Internal Audit team periodically looks at the implementation of the relevant
policy by an internal or external agency? policies.
3. Governance related to BR Business Responsibility Report is part of the Annual Report. It is also
available on the Company’s website www.vsthyd.com.
It is proposed to be assessed annually.

73
SECTION E: PRINCIPLE-WISE PERFORMANCE 6. What percentage of your permanent employees is

members of this recognized employee association? 56%
Principle 1 : Businesses should conduct and
7. Please indicate the Number of complaints relating to
govern themselves with Ethics, Transparency and
child labour, forced labour, involuntary labour, sexual
Accountability
harassment in the last financial year and pending, as
Your Company is committed to adhere to the highest on the end of the financial year : Nil
standards of ethical and legal conduct of its business
operations. In order to maintain these standards, it has No. Category No. of complaints No. of complaints
adopted the ‘Code of Conduct’, which lays down the filed during the pending as on end
principles and standards that should govern the actions of financial year of the financial year
the employees and the Board of Directors in the course of 1 Child labour/forced 0 0
conduct of business of the Company. Any actual or potential labour/involuntary
labour
violation of the Code, would receive appropriate intervention
by the Company. 2 Sexual harassment 0 0
3 Discriminatory 0 0
The Company has adopted a ‘Whistle blower policy’ to
employment
highlight any concerns and for a proper redressal of the
same. 8. What percentage of your under mentioned employees
were given safety & skill upgradation training in the last
There were no complaints from shareholders pending at year?
the beginning of the year. The Company received 77
complaints from shareholders during the year and all (a) Permanent Employees : 70%
complaints have been resolved satisfactorily. (b) Permanent Women Employees: Nil
Principle 2 : Businesses should provide goods and (c) Casual/Temporary/Contractual Employees : 20%
services that are safe and contribute to (d) Employees with Disabilities: NA
sustainability throughout their life cycle Principle 4 : Businesses should respect the
Your Company believes in developing products which are interests of, and be responsive towards all
efficient and environment friendly and several steps have stakeholders, especially those who are
been taken in this direction. disadvantaged, vulnerable and marginalized
The Environment Management practices of the Company Your Company mapped its internal and external stakeholders
focus on conservation of natural resources and waste in a structured way and carries out engagements with
management. employees, customers, suppliers, business partners, etc. It
also identifies the interests of its internal stakeholders like
Further, at the factory locations, the Company endeavors to
employees through feedback surveys and other periodic
create jobs for the local communities.
worker settlement reviews. The external shareholders are
Principle 3 : Businesses should promote the well mapped through various sales and marketing activities such
being of all employees as trade shows, customer contact programs, channel partner
1. Please indicate the Total number of employees : 782 meets, trainings, etc. The Company also commits to
2. Please indicate the Total number of employees hired on Government initiatives like Swachh Bharat. It participates in
temporary/contractual/casual basis : 153 the events organized by trade associations and contributes
3. Please indicate the Number of permanent women by providing inputs when requested.
employees : 16 The Company has supported initiatives towards Agriculture
4. Please indicate the Number of permanent employees & Horticulture development, Water Management &
with disabilities: Nil Harvesting, Training in Farming techniques to the farmers
5. Do you have an employee association that is recognized etc.
by management: Yes Your Company is involved in various programs for the
improvement of living conditions in tobacco growing areas.
72
Principle 5 : Businesses should respect and and Industry

promote human rights
c) Confederation of Indian Industry
The Code of Conduct is applicable to all the employees.
d) Tobacco Institute of India
There have been no complaints received in the past financial
year. Your Company participates in seminars, conferences
organized by these associations.
The Company promotes the Code of Conduct which apart
from other things ensures that there are no instances of sexual Principle 8 : Businesses should support inclusive
harassment, child labour or discriminatory practices. growth and equitable development
Principle 6 : Businesses should respect, protect, Your Company is committed to corporate citizenship and
and make efforts to restore the environment sustainability. It has a policy on Corporate Social
Responsibility and the focal areas at present being rural
All the Company’s manufacturing units have policies on
sanitation and environment sustainability.
environment, health and safety measures in line with the
Environment, Health and Safety Practices adopted by the These initiatives are implemented by the Company mainly
Company. through Gramalaya, a non-profit organization. The financial
and impact details are covered in the Directors’ Report and
The units are covered under ISO 14000 environment
its Annexures.
management system. The Company also monitors
hazardous wastes and emissions in its manufacturing units Principle 9 : Businesses should engage with and
and the wastes and emissions are within permissible limits provide value to their customers in a responsible
as laid down by the regulators. manner
There are no pending EHS show cause notices as at the end There were two consumer cases pending during the financial
of the financial year. year relating to the Company. One was dismissed in your
Principle 7 : Businesses, when engaged in Company’s favor during the year. The other one is being
influencing public and regulatory policy, should dealt with appropriately before the respective consumer
do so in a responsible manner forums and your Company does not find them tenable. For
receiving and resolving customer complaints there are
The Company is a member of the following trade/chamber/ adequate systems in place to address them. Customers may
association: register their grievances over the dedicated helpline. Your
a) All India Management Association Company adheres to all applicable laws and regulations
b) Telangana and Andhra Pradesh Chambers of Commerce on product labelling.

INDEPENDENT AUDITORS’ REPORT
To the Members of VST Industries Limited

Report on the Audit of the Ind AS Financial Statements
Opinion
We have audited the Ind AS financial statements of VST Industries Limited (“the Company”), which comprise the balance
sheet as at 31 March 2019, and the statement of profit and loss (including other comprehensive income), statement of
changes in equity and statement of cash flows for the year then ended, and notes to the Ind AS financial statements,
including a summary of the significant accounting policies and other explanatory information (herein after referred to as the
“Ind AS financial statements”).
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Ind AS
financial statements give the information required by the Companies Act, 2013 (“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 March 2019, and profit and other comprehensive income, changes in equity and its cash flows for the
year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our
responsibilities under those SAs are further described in the Auditor’s Responsibilities for the Audit of the Ind AS financial
statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the
Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the Ind AS
financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical
responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Ind AS
financial statements of the current period. These matters were addressed in the context of our audit of the Ind AS financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We
have determined the matters described below to be the key audit matters to be communicated in our report.
Litigations and contingencies related to taxation and other claims
Refer Note 18 and Note 27 to Ind AS financial statements and "significant & material orders passed by the regulators or
courts or tribunals" section in the Reports of the Board of Directors & Management Discussion and Analysis.
Key audit matters How the matter was addressed in our audit
The Company is subjected to a large volume of tax Our key audit procedures included:
litigations and other claims, which could have a ● Through discussion with the Management, we understood the
significant impact on the results depending upon Company’s process around the identification, evaluation and
the outcome of the matter. continuous re-assessment of tax related provision, accounting
The amounts involved are significant, and the policy thereof and other claims. The process followed by
application of accounting standards to determine management involved application of accounting standards in
the amount, if any, to be provided as a liability or estimating the amounts if any to be provided for or disclosed as a
disclosed as a contingent liability, is inherently contingent liability which is inherently subjective. This includes
subjective. assumptions relating to the likelihood and/or timing of cash
outflows from the business and the interpretation of preliminary
The Company regularly updates and assesses its and pending court rulings.
legal positions with the use of internal and external ● Assessed the Company’s provisioning methodology and discussed
legal experts. In addition, the Company estimates significant litigation matter with the Management and performed
and records related accruals at the end of the review of board and audit committee minutes.
reporting period. This includes assumptions relating ● Involved our internal tax specialists to assess the Company’s tax
to the likelihood and/or timing of cash outflows from positions and to analyse and challenge the assumptions used by
the business and the interpretation of preliminary management to assess the probability and determine the amount,
and pending court rulings. to be provided as a liability or disclosed as a contingent liability.
We considered the tax related litigations and ● Assessed relevant historical and recent judgements passed by the
contingencies and other claims important given the court authorities in considering any legal precedent or case law,
size and complexity of the litigations, and related as well as assessing legal opinions from third party lawyers.
uncertainty of the outcomes. ● Assessed the adequacy of the Company’s disclosures (in Note 18
and 27) made in relation to Litigations and contingencies related
to taxation and other claims.
74
Revenue Recognition
Refer to Note 1 -Significant Accounting Policies to the Ind AS financial statements
Key audit matters How the matter was addressed in our audit
Regulatory restrictions and taxation changes may have In view of the significance of the matter we applied the following
impact on the revenue growth of the Company and audit procedures in this area, among others to obtain sufficient
resultant impact on the price and volume of product appropriate audit evidence:
sold.
Revenue from sale of goods is recognized when ● Assessed the appropriateness of the Company’s revenue
effective control over goods is transferred to a recognition accounting policies including those relating to
customer as per the terms of the contract. This is discounts, incentives and rebates and assessing compliance
usually evidenced by a transfer of all the significant with the policies in terms of applicable accounting standards.
risks and rewards of ownership upon delivery of goods
● Tested the effectiveness of the Company’s controls over
to the customer, which in terms of timing is not
materially different to the date of shipping. measurement and recognition of revenue in accordance with
customer contract which includes control over transaction
Revenue is measured at fair value of the consideration
pricing including discounts, incentives and rebates and correct
received or receivable after deduction of any trade
discount, incentive and other similar discounts and timing of revenue recognition.
any taxes or duties collected on behalf of the ● Assessed sales transactions taking place at either side of the
Government which are levied on sales such as Goods balance sheet date as well as credit notes issued after the
& service Tax, etc. year end date to assess whether that revenue was recognised
Revenue is one of the key performance indicators of in the correct period.
the Company and there could be a risk that
Management may override controls to meet targets ● Also performed analytical procedures on current period
or expectations. This may result in revenue to be rebate/discounts in comparison with previous year, including
recognized before the control have been transferred the estimates made for evidence of Management bias.
to the customer. Further, recognition and measurement
of provision related to trade promotion scheme, ● Other audit procedures specifically designed to address risk
incentives and rebates involve management of Management override of controls included journal entry
judgement. testing.
Other Information
The Company’s management and Board of Directors are responsible for the other information. The other information
comprises the information included in the Company’s annual report, but does not include the financial statements and our
auditors’ report thereon.
Our opinion on the Ind AS financial statements does not cover the other information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the Ind AS financial statements, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the Ind AS financial statements or our
knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed,
we conclude that there is a material misstatement of this other information, we are required to report that fact. We have
nothing to report in this regard.
Management's Responsibility for the Ind AS Financial Statements
The Company’s management and Board of Directors are responsible for the matters stated in section 134(5) of the Act with
respect to the preparation of these Ind AS financial statements that give a true and fair view of the state of affairs, profit/loss
and other comprehensive income, changes in equity and cash flows of the Company in accordance with the accounting
principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of
the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of
the Act for safeguarding of 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 effectively
for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the

73
Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or
error.
In preparing the Ind AS financial statements, management and Board of Directors are responsible for assessing the
Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations,
or has no realistic alternative but to do so.
Board of Directors is also responsible for overseeing the Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Ind AS Financial Statements
Our objectives are to obtain reasonable assurance about whether the Ind AS financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always
detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of these Ind AS financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism
throughout the audit. We also:
• Identify and assess the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate
to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than
for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate
in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether
the company has adequate internal financial controls with reference to financial statements in place and the operating
effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the
audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant
doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the related disclosures in the Ind AS financial statements or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the
date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a
going concern.
• Evaluate the overall presentation, structure and content of the Ind AS financial statements, including the disclosures,
and whether the Ind AS financial statements represent the underlying transactions and events in a manner that achieves
fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may reasonably be
thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most
significance in the audit of the Ind AS financial statements of the current period and are therefore the key audit matters. We
describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when,
in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse
consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
76
Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors’ Report) Order, 2016 (“the Order”) issued by the Central Government of India
in terms of section 143 (11) of the Act, we give in the “Annexure A” a statement on the matters specified in paragraphs
3 and 4 of the Order, to the extent applicable.
2. As required by Section 143(3) of the Act, we report that:
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 loss (including other comprehensive income), the statement of
changes in equity and the statement of cash flows dealt with by this Report are in agreement with the books of
account;
d) In our opinion, the aforesaid Ind AS financial statements comply with the Ind AS specified under section 133 of the
Act, read with Rule 3 of the Companies (Accounts) Rules, 2014;
e) On the basis of the written representations received from the directors as on 31 March 2019 taken on record by the
Board of Directors, none of the directors is disqualified as on 31 March 2019 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 controls with reference to financial statements of the Company
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 Auditors’ 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 has disclosed the impact of pending litigations as at 31 March 2019 on its financial position in
its Ind AS financial statements - Refer Note 18 and 27 to the Ind AS financial statements;
ii. The Company has long-term contracts including derivative contracts comprising of forward contracts as at 31
March 2019 for which there were no material foreseeable losses; and
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and
Protection Fund by the Company.
3. With respect to the matter to be included in the Auditors’ Report under section 197(16):
In our opinion and according to the information and explanations given to us, the remuneration paid by the company
to its directors during the current year is in accordance with the provisions of Section 197 of the Act. The remuneration
paid to any director is not in excess of the limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs
has not prescribed other details under Section 197(16) which are required to be commented upon by us.
For B S R & ASSOCIATES LLP

ICAI Firm Registration Number : 116231W/W-100024
SRIRAM MAHALINGAM
Partner
Place : Hyderabad
Date : 3rd May, 2019

73
ANNEXURE A TO THE INDEPENDENT AUDITORS’ REPORT
Report on the matters specified in paragraphs 3 and 4 of Companies (Auditor’s Report) Order, 2016
to the aforesaid Ind AS financial statements under Sub-section 11 of Section 143 of the Companies
Act, 2013.
(Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date).
We report that:
i. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation
of property, plant and equipment;
(b) The property, plant and equipment are physically verified by the management according to a phased programme
designed to cover all the items over a period of three years which, in our opinion, is reasonable having regard to
the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the property, plant
and equipment has been physically verified by the management during the year and no material discrepancies
have been noticed on such verification.
(c) According to the information and explanations given to us and on the basis of our examination of records of the
Company, the title deeds of immovable properties, as disclosed in Note 2 on property, plant and equipment to the
Ind AS financial statements, are held in the name of the Company.
ii. The inventories have been physically verified by the Management during the year at reasonable intervals. In our
opinion, the frequency of such verification is reasonable. The discrepancies noticed on verification between the physical
stocks and the book records were not material.
iii. The Company has not granted any loans, secured or unsecured, to companies, firms, Limited liability partnership or
other parties covered in the Register maintained under Section 189 of the Companies Act, 2013 (“the Act”). Accordingly,
paragraph 3(iii) of the Order is not applicable to the Company.
iv. The Company has not granted any loans or made any investments, or provided any guarantees or security to the
parties covered under Sections 185 and 186. Accordingly, paragraph 3(iv) of the Order is not applicable to the
Company.
v. The Company has not accepted any deposits from the public in accordance with provisions of Sections 73 to 76 of the
Act and the Rules framed thereunder.
vi. The Central Government of India has not specified the maintenance of cost records under sub- section (1) of Section
148 of the Act for any of the products of the Company. Accordingly, paragraph 3(vi) of the Order is 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, Employees’ state insurance, Income-tax, Goods and Service tax, Duty of customs, Duty of excise,
Cess and other material statutory dues have been regularly deposited during the year by the Company with the
appropriate authorities.
According to the information and explanations given to us and on the basis of our examination of the records of the
Company, no undisputed amounts payable in respect of Provident fund, Employees’ state insurance, Income-tax,
Goods and Service tax, Duty of customs, Duty of excise, Cess and other material statutory dues were in arrears as
at 31 March 2019 for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us and on the basis of our examination of the records of the
Company, there are no dues of Income tax, Goods and Service tax, Duty of customs, Duty of excise and Value
added tax which have not been deposited with appropriate authorities on account any dispute. According to the
information and explanations given to us, the following dues of Sales tax and Service tax have not been deposited
by the Company on account of disputes.
78
ANNEXURE A TO THE INDEPENDENT AUDITORS’ REPORT
Name of Nature of dues Amount in Period to which Forum where the

statute lakhs (`) the amount relates dispute is pending
The Central Excise Service tax credit 248.82 May 2008 to September 2011; Customs, Excise & Service
Act, 1944 ineligibility under October 2012 to September Tax Appellate Tribunal
Cenvat Credit Rules, 2013; August 2015 to March
2002 2016; April 2016 to March 2017
The Central Central Sales tax 68.83 Financial year 2010-11 Joint Commissioner
Sales Tax Appeals (Guwahati)
viii. The Company does not have any loans or borrowings from any financial institution or bank or Government nor has it
issued any debentures during the year. Accordingly, paragraph 3(viii) of the Order is not applicable to the Company.
ix. The Company has not raised any money by way of initial public offer or further public offer (including debt instruments)
and term loans during the year. Accordingly, paragraph 3(ix) of the Order is not applicable to the Company.
x. During the course of our examination of the books and records of the Company, carried out in accordance with the
generally accepted auditing practices in India, and according to the information and explanations given to us, we have
neither come across any instance of material fraud by the Company or on the Company by its officers or employees,
noticed or reported during the year, nor have we been informed of any such case by the Management.
xi. According to the information and explanations given to us and based on our examination of the records on 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 of 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 to the Company.
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 Section 177 and 188 of the Act where applicable and
details of such related party transactions have been disclosed in the Note 29 to the Ind AS Financial Statements as
required by the applicable Indian Accounting Standards.
xiv. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible
debentures during the year. Accordingly, paragraph 3(xiv) of the Order is not applicable to the Company.
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 any non-cash transaction with the directors or persons connected with him. Accordingly,
paragraph 3(xv) of the Order is not applicable to the Company.
xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly,
paragraph 3(xvi) of the Order is not applicable to the Company.
SRIRAM MAHALINGAM
Partner
Place : Hyderabad

73
ANNEXURE B TO THE INDEPENDENT AUDITORS’ REPORT
Report on the internal financial controls with reference to the aforesaid Ind AS financial statements
under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013
(Referred to in clause (f) of paragraph 2 under ‘Report on Other Legal and Regulatory Requirements’ section of our report
of even date)
Opinion
We have audited the internal financial controls with reference to financial statements of VST Industries Limited (“the Company”)
as of 31 March 2019 in conjunction with our audit of the Ind AS financial statements of the Company for the year ended on
that date.
In our opinion, the Company has, in all material respects, adequate internal financial controls with reference to financial
statements and such internal financial controls were operating effectively as at 31 March 2019, based on the internal
financial controls with reference to financial statements criteria 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 (the “Guidance Note”).
Management’s Responsibility for Internal Financial Controls
The Company’s management and the Board of Directors are responsible for establishing and maintaining internal financial
controls based on the internal financial controls with reference to financial statements criteria established by the Company
considering the essential components of internal control stated in the Guidance Note. These responsibilities include the
design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring
the orderly and efficient conduct of its business, including adherence 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 the Companies Act, 2013 (hereinafter referred to as “the
Act”).
Auditors’ Responsibility
Our responsibility is to express an opinion on the Company's internal financial controls with reference to financial statements
based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing,
prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls with reference
to financial statements. 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 with reference to
financial statements were established and maintained and whether 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
with reference to financial statements and their operating effectiveness. Our audit of internal financial controls with reference
to financial statements included obtaining an understanding of such internal financial controls, 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 judgement, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion
on the Company’s internal financial controls with reference to financial statements.
80
ANNEXURE B TO THE INDEPENDENT AUDITORS’ REPORT
Meaning of Internal Financial controls with Reference to Financial Statements
A company's internal financial controls with reference to financial statements is a process designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. A company's internal financial controls with reference to financial
statements include those policies and procedures that:
1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions
of the assets of the company;
2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements
in accordance with 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 financial statements.
Inherent Limitations of Internal Financial controls with Reference to Financial Statements
Because of the inherent limitations of internal financial controls with reference to financial statements, including the possibility
of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not
be detected. Also, projections of any evaluation of the internal financial controls with reference to financial statements to
future periods are subject to the risk that the internal financial controls with reference to financial statements may become
inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

SRIRAM MAHALINGAM
Partner
Place : Hyderabad

73
BALANCE SHEET AS AT 31ST MARCH, 2019
` in Lakhs
Note As at As at
31st March, 2019 31st March, 2018
I ASSETS
1 Non-Current Assets
(a) Property, Plant and Equipment 2A 21333.73 19506.23
(b) Capital Work-in-Progress 2B 29.85 3422.11
(c) Intangible Assets 2C 7.24 1.22
(d) Financial Assets
(i) Investments 3 225.98 202.61
(ii) Loans 4 13.38 14.85
(iii) Other Financial Assets 5 1.77 241.13 1.77 219.23
(e) Deferred Tax Assets (Net) 6 3101.46 2481.65
(f) Other Non-Current Assets 7 111.80 297.80
2 Current Assets
(a) Inventories 8 28184.96 25287.48
(b) Financial Assets
(i) Investments 9 57305.88 41409.57
(ii) Trade Receivables 10 1431.74 2733.09
(iii) Cash and Cash Equivalents 11 2638.60 2852.11
(iv) Other Bank Balances 12 1047.21 906.71
(v) Loans 4 1.46 1.69
(vi) Other Financial Assets 5 121.21 62546.10 0.12 47903.29
(c) Current Tax Assets (Net) 13 192.77 261.72
(d) Other Current Assets 7 4935.84 7032.60
TOTAL 120684.88 106413.33
II EQUITY AND LIABILITIES
1 Equity
(a) Equity Share Capital 14 1544.19 1544.19
(b) Other Equity 64858.86 66403.05 56664.88 58209.07
2 Liabilities
Non-Current Liabilities
(a) Provisions 15 1849.74 1415.15
Current Liabilities
(a) Financial Liabilities
(i) Trade Payables 16
- Total outstanding dues of micro
enterprises and small enterprises 30.01 32.28
- Total outstanding dues of creditors
other than micro enterprises and
small enterprises 8271.35 5776.67
(ii) Other Financial Liabilities 17 1270.37 9571.73 1308.70 7117.65
(b) Other Current Liabilities 18 42860.36 39671.46
TOTAL 120684.88 106413.33
The accompanying notes 1 to 34 form an integral part of the Financial Statements.
This is the Balance Sheet referred to in our report of even date. On behalf of the Board,
For B S R & Associates LLP PRADEEP V. BHIDE Chairman
Firm Registration No. 116231W/W - 100024 DIN : 03304262
Chartered Accountants DEVRAJ LAHIRI Managing Director
DIN : 03588071
SRIRAM MAHALINGAM
Partner ANISH GUPTA Chief Financial Officer
Membership No. 049642 PHANI K. MANGIPUDI Company Secretary
Hyderabad, 3rd May, 2019. Hyderabad, 3rd May, 2019.
82
STATEMENT OF PROFIT AND LOSS FOR THE
YEAR ENDED 31ST MARCH, 2019
` in Lakhs
Note For the year ended For the year ended

I Revenue from operations 19 118410.61 135863.55
II Other Income 20 3889.99 2462.40
III Total Income (I+II) 122300.60 138325.95
IV Expenses
Cost of Materials Consumed 21 55964.19 46324.43
Changes in Inventories of Finished Goods and Work-in-Progress 22 (947.49) 705.19
Excise Duty (Refer Note 33) 8509.61 41106.43
Employee Benefits Expense 23 9226.12 8919.52
Depreciation and Amortisation Expense 4134.53 3916.41
Other Expenses 24 10346.19 9408.58
Total Expenses 87233.15 110380.56
V Profit before tax (III-IV) 35067.45 27945.39
VI Tax expense:
1) Current tax 6 13076.44 9956.20
2) Deferred tax 6 (693.42) (200.12)
12383.02 9756.08
VII Profit for the year (V-VI) 22684.43 18189.31
Other Comprehensive Income
A (i) Items that will not be reclassified to profit or loss:
- Remeasurements of the defined benefit plans (net) (215.40) 75.89
- Change in Fair Value of Equity instruments 23.37 26.09
(ii) Income tax relating to items that will not be
reclassifed to profit or loss 6 46.14 (26.26)
B (i) Items that will be reclassified to profit or loss:
- Change in Fair Value of effective portion of
Cash flow hedges 127.36 (21.29)
(ii) Income tax relating to items that will be reclassifed
to profit or loss 6 (44.48) 7.37
VIII Other Comprehensive Income (A+B) (63.01) 61.80
IX Total Comprehensive Income for the year (VII+VIII) 22621.42 18251.11
X Earnings per equity share (Face Value `10 each):
1) Basic (in `) 25 146.90 117.79
2) Diluted (in `) 25 146.90 117.79

This is the Statement of Profit and Loss referred to in our report of even date. On behalf of the Board,
DIN : 03588071
SRIRAM MAHALINGAM

73
STATEMENT OF CHANGES IN EQUITY FOR THE
` in Lakhs
A EQUITY SHARE CAPITAL
Balance at the beginning Changes in equity share Balance at the end of the
of the reporting year capital during the year reporting year
For the year ended 31st March, 2018 1544.19 - 1544.19
For the year ended 31st March, 2019 1544.19 - 1544.19
B OTHER EQUITY
Reserve and Surplus Other Comprehensive Income (OCI) Total
Capital General Retained Equity Cash Flow Remeasurement
Redemption Reserve Earnings Instru- Hedge of defined
Reserve ments benefit
plans (net)
Balance as at 31st March, 2017 1000.25 22402.15 29007.96 36.53 9.53 (103.50) 52352.92
Profit for the year 18189.31 18189.31
Other Comprehensive Income (net of tax) 26.09 (13.92) 49.63 61.80
Dividend on
Ordinary Shares-Final (`75/- per share) (11581.44) (11581.44)
Dividend tax thereon (2357.71) (2357.71)
Transfer to General Reserve 900.00 (900.00) -
Balance as at 31st March, 2018 1000.25 23302.15 32358.12 62.62 (4.39) (53.87) 56664.88
Profit for the year 22684.43 22684.43
Other Comprehensive Income (net of tax) 22.75 82.88 (168.64) (63.01)
Dividend on
Ordinary Shares-Final (`77.5/- per share) (11967.49) (11967.49)
Dividend tax thereon (2459.95) (2459.95)
Transfer to General Reserve 2250.00 (2250.00) -
Balance as at 31st March, 2019 1000.25 25552.15 38365.11 85.37 78.49 (222.51) 64858.86
An amount of ` 95/- per ordinary share (2018 - ` 77.5/-) is recommended to be paid as dividend by the Board of Directors of the
Company, subject to approval of the Shareholders at their Annual General Meeting and has not been recognised as a liability in
these financial statements. The amount of total dividend is ` 14669.82 Lakhs (2018 - ` 11967.49 Lakhs) and income tax thereon is
` 3015.43 Lakhs (2018 - ` 2459.95 Lakhs).
Nature and purpose of reserves
a) Capital Redemption Reserve: The Company has recognised Capital Redemption Reserve on redemption of cummulative preference shares.
b) General Reserve: The Company has transferred a portion of the net profit of the Company to General Reserve and the same can
be utilised by the Company in accordance with the provisions of the Companies Act, 2013.
c) Retained Earnings: Retained earnings are the profits that the Company has earned till date, less any transfers to general reserve,
dividends or other distributions paid to shareholders.
d) Equity Instruments through Other Comprehensive Income: This Reserve represents the cumulative gains (net of losses) arising on
revaluation of Equity Instruments measured at fair value through Other Comprehensive Income, net of amounts reclassified, if
any, to Retained Earnings when those instruments are disposed off.
e) Cash Flow Hedge: This Reserve represents the cumulative effective portion of change in fair value of derivatives that are designated
as Cash Flow Hedge. It will be reclassified to profit or loss in accordance with the Company's accounting policy.
f) Remeasurement of Defined Benefit Plans: This represents net acturial gain/loss arising on account of remeasurement of defined
employee benefit plans.
This is the Statement of Changes in Equity referred to in our report of even date. On behalf of the Board,
SRIRAM MAHALINGAM DIN : 03588071
84
STATEMENT OF CASH FLOWS FOR THE
` in Lakhs
For the year ended For the year ended
A Cash Flow from Operating Activities
Profit Before Tax Expense 35067.45 27945.39
Adjustments:
Depreciation and Amortisation Expense 4134.53 3916.41
Profit on sale of Property, Plant and Equipment (Net) (9.86) (165.16)
Unrealised (Gain)/Loss on Exchange (Net) 56.02 (55.27)
Interest on Loans and Deposits, etc. (5.80) (8.13)
Dividend Income from Non-Current Investments (4.35) (4.47)
Net gain arising on Current Investments measured at FVTPL (3661.34) (2121.16)
Operating Profit before Working Capital Changes 35576.65 29507.61
Adjustments for Movement in Working Capital:
Trade Receivables, Advances and Other Assets 3342.65 (7145.12)
Inventories (2897.48) 7643.55
Trade Payables, Other Liabilities and Provisions 5860.81 22108.49
Cash generated from Operations 41882.63 52114.53
Income Taxes Paid (Net) (12866.32) (10102.23)
Net cash from Operating Activities 29016.31 42012.30
B Cash Flow from Investing Activities

Purchase of Property, Plant and Equipment, Intangibles,etc (2588.98) (4541.32)
Sale of Property, Plant and Equipment 10.16 219.14
Purchase of Current Investments (317867.00) (511446.00)
Sale/ Redemption of Current Investments 305632.03 489339.52
Dividend Income from Non-Current Investments 4.35 4.47
Interest on Loans and Deposits, etc. 5.36 8.01
Loans realised 1.70 3.05
Net cash used in Investing Activities (14802.38) (26413.13)
C Cash Flow from Financing Activities

Dividends (including tax thereon) paid on equity shares (14427.44) (13939.15)
Net cash used in Financing Activities (14427.44) (13939.15)
Net change in cash and cash equivalents (213.51) 1660.02
Opening cash and cash equivalents 2852.11 1192.09
Closing cash and cash equivalents 2638.60 2852.11

This is the Statement of Cash Flows referred to in our report of even date. On behalf of the Board,
DIN : 03588071
SRIRAM MAHALINGAM

73
NOTES TO THE FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES

COMPANY INFORMATION
VST Industries Limited (the ‘Company’) is a public limited Company domiciled in India with its registered office located at 1-7-1063/
1065, Azamabad, Hyderabad - 500020. The Company is listed on the Bombay Stock Exchange (BSE) and the National Stock
Exchange (NSE). The Company is engaged inter-alia in manufacture and trading of Cigarettes, Tobacco and Tobacco products.
STATEMENT OF COMPLIANCE
These financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notified under Section 133
of the Companies Act, 2013 read with the Companies (Indian Accounting Standards) Rules, 2015 and relevant amendment Rules
issued thereafter.
The financial statements have also been prepared in accordance with the relevant presentation requirements of the Companies Act,
2013. The Company adopted Ind AS from 1st April, 2017. The financial statements were authorised for issue by the Company's
Board of Directors on 3rd May, 2019.
BASIS OF PREPARATION OF FINANCIAL STATEMENTS
The financial statements have been prepared on accrual and going concern basis. The Accounting Policies are applied consistently to
all the periods presented in the financial statements. All assets and liabilities have been classified as current or non-current as per the
Company's normal operating cycle and other criteria as set out in the Division II of Schedule III to the Companies Act, 2013. Based on
the nature of products and the time between acquisition of assets for processing and their realisation in cash and cash equivalents, the
Company has ascertained its operating cycle as 12 months for the purpose of current or non-current classification of assets and
liabilities.
The statement of cash flows has been prepared under indirect method.
BASIS OF MEASUREMENT
These financial statements are prepared in accordance with Indian Accounting Standards (Ind AS) under the historical cost convention
on accrual basis, except for certain items that are measured at fair value, as explained in the accounting policies. Fair Value is the
price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the
measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating
the fair value of an asset or a liability, the Company takes into account the characteristics of the asset or liability, if market participants
would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement
and / or disclosure purposes in these financial statements is determined on such a basis, except leasing transactions that are within
the scope of Ind AS 17 – Leases, and measurements that have some similarities to fair value but are not fair value, such as net
realisable value in Ind AS 2 – Inventories or value in use in Ind AS 36 – Impairment of Assets.
The preparation of financial statements in conformity with Ind AS requires management to make judgements, estimates and assumptions
that affect the application of the accounting policies and the reported amounts of assets and liabilities, disclosure of contingent assets
and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses for the year. The estimates
and underlying assumptions are reviewed on an ongoing basis. Actual results could differ from those estimates.
Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period;
they are recognised in the period of the revision and future periods if the revision affects both current and future periods.
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment are stated at acquisition or construction cost, net of accumulated depreciation and accumulated
impairment losses, if any. Upon adoption of Ind AS, the Company had elected to measure all its property, plant and equipment at the
Previous GAAP carrying amount as its deemed cost on the date of transition to Ind AS i.e., 1st April, 2016.
Cost is inclusive of freight, installation costs, duties and taxes, interest on specific borrowings utilised for financing the assets and other
incidental expenses.
All upgradations / enhancements are charged off as revenue expenditure unless they bring similar significant additional benefits.
An item of property, plant and equipment is de-recognised upon disposal or when no future economic benefits are expected to arise
from the continued use of asset. Any gains or losses arising on retirement or disposal of property, plant and equipment is determined
as difference between the sale proceeds and the carrying amount of the asset and is recognised in the Statement of Profit and Loss.
Property, plant and equipment which are not ready for intended use as on the date of Balance Sheet are disclosed as “Capital work-
in-progress”.
86
DEPRECIATION
Depreciation is provided on the straight line method at the rates based on estimated useful life of assets as prescribed under Part C of
Schedule II to the Companies Act, 2013 with the exception of the following:
Building on freehold Land - 20 Years
Building on Leasehold Land - 20 Years
Motor Vehicles - 4 Years
Assets costing ` 5,000 or less - fully depreciated in the year of purchase.
Freehold land is not depreciated.
The residual values, useful lives and method of depreciation of property, plant and equipment are reviewed at each financial year end
and adjusted prospectively, if appropriate.
INTANGIBLE ASSETS
Intangible assets are stated at cost less any accumulated amortisation and accumulated impairment losses, if any.
Computer Software (including licence fee and cost of implementation/system integration services) is capitalised where ever it is
expected to provide future enduring economic benefits. Cost of upgradation/enhancements is charged off as revenue expenditure
unless they bring similar significant benefits.
The useful lives of intangible assets are assessed as either finite or infinite. Finite-life intangible assets are amortised on a straight-line
basis over the period of their expected useful lives. Estimated useful lives by major class of finite-life intangible assets are as follows:
Computer software - 4 years
The amortisation period and the amortisation method for finite-life intangible assets is reviewed at each financial year end and
adjusted prospectively, if appropriate.
The assessment of infinite life is reviewed annually to determine whether the infinite life continues, if not, it is impaired or changed
prospectively basis revised estimates.
IMPAIRMENT OF NON FINANCIAL ASSETS
Assessment for impairment is done at each Balance Sheet date as to whether there is any indication that a non-financial asset may be
impaired. Impairment loss, if any, is provided to the extent, the carrying amount of non- financial assets or cash generating units
exceed their recoverable amount.
Recoverable amount is higher of an asset’s or cash generating unit’s fair value less cost of disposal and its value in use. Value in use
is the net present value of estimated future cash flows expected to arise from the continuing use of an asset or cash generating unit
and from its disposal at the end of its useful life.
Assessment is also done at each Balance Sheet date as to whether there is any indication that an impairment loss recognised for an
asset in prior accounting periods may no longer exist or may have decreased, basis the assessment a reversal of an impairment loss
of an asset is recognised in the Statement of Profit and Loss.
DERIVATIVES AND HEDGE ACCOUNTING
Derivatives are initially recognised at fair value and are subsequently re-measured to their fair value at the end of each reporting
period. The resulting gain/loss is recognised in the Statement of Profit and Loss immediately unless the derivative is designated as an
effective hedging instrument, in which event the timing of recognition in profit or loss/inclusion in the initial cost of non-financial asset
depends on the nature of the hedging relationship and the nature of the hedged item.
The Company complies with the principles of hedge accounting where derivative contracts are designated as hedge instruments. At
the inception of the hedge relationship, the Company documents the relationship between the hedge instrument and the hedged item
along with the risk management objectives and its strategy for undertaking hedge transaction, which can be a fair value hedge or a
cash flow hedge.
(i) Fair value hedges
Changes in fair value of the designated portion of derivatives that qualify as fair value hedges are recognised in statement of profit
and loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged
risk. The change in the fair value of the designated portion of hedging instrument and the change in fair value of the hedged item
attributable to the hedged risk are recognised in the statement of profit and loss in the line item relating to the hedged item.

73
Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, or exercised, or when it no longer
qualifies for hedge accounting. The fair value adjustment to the carrying amount of the hedged item arising from the hedged risk is
amortised to profit or loss from that date.
(ii) Cash flow hedges
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in
the other comprehensive income and accumulated as ‘Cash Flow Hedge' in Equity. The gains/losses relating to the ineffective portion
is recognised in the statement of profit and loss. Amounts previously recognised and accumulated in other comprehensive income are
reclassified to profit or loss when the hedged item affects the Statement of Profit and Loss. However, when the hedged item results in
the recognition of a non-financial asset, such gains/losses are transferred from equity (but not as reclassification adjustment) and
included in the initial measurement cost of the non-financial asset.
Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, or exercised, or when it no longer
qualifies for hedge accounting. Any gains/losses recognised in other comprehensive income and accumulated in equity at that time
remains in equity and is reclassified to statement of profit and loss when the underlying transaction is ultimately recognised. When an
underlying transaction is no longer expected to occur, the gains/losses accumulated in equity is recognised immediately in the
statement of profit and loss.
FOREIGN CURRENCIES
The financial statements are presented in INR, the functional currency of the Company. Items included in the financial statements of
the Company are recorded using the currency of the primary economic environment in which the Company operates (the ‘functional
currency’).
Foreign currency transactions are translated into the functional currency using exchange rates on the date of the transaction. Foreign
exchange gains and losses from settlement of these transactions and from translation of monetary assets and liabilities at the
exchange rate prevailing on reporting date are recognised in the Statement of Profit and Loss.
FINANCIAL INSTRUMENTS
I. Financial Assets
Financial assets are recognised when the Company becomes a party to the contractual provisions of the instrument. On initial
recognition, a financial asset is recognised at fair value, in case of financial assets which are recognised at fair value through profit
and loss, its transaction cost are recognised in the statement of profit and loss. In other cases, the transaction cost are attributed to the
acquisition value of the financial asset. Financial assets are subsequently classified as measured at
• amortised cost
• fair value through profit and loss ('FVTPL')
• fair value through other comprehensive income ('FVOCI').
Financial assets are not reclassified subsequent to their recognition, except if and in the period the Company changes its business
model for managing financial assets.
Trade Receivables and Loans
Trade receivables are initially recognised at fair value. Subsequently, these assets are held at amortised cost, using the effective
interest rate ('EIR') method net of any expected credit losses. The EIR is the rate that discounts estimated future cash income through the
expected life of financial instrument.
Debt Instruments
Debt instruments are initially measured at amortised cost, or FVTPL or FVOCI till derecognition, on the basis of (i) the entity’s business
model for managing the financial assets and (ii) the contractual cash flow characteristics of the financial asset.
(a) Measured at amortised cost: Financial assets that are held within a business model whose objective is to hold financial assets in
order to collect contractual cash flows that are solely payment of principal and interest, are subsequently measured at amortised
cost using the EIR method less impairment, if any. The amortisation of EIR and loss arising from impairment, if any is recognised
in the statement of profit and loss.
(b) Measured at fair value through other comprehensive income: Financial assets that are held within a business model whose
objective is achieved by both, selling financial assets and collecting contractual cash flows that are solely payments of principal
and interest, are subsequently measured at fair value through other comprehensive income. Fair value movements are recognized
in the other comprehensive income (OCI). Interest income measured using the EIR method and impairment losses, if any are
recognised in the Statement of Profit and Loss. On derecognition, cumulative gain or loss previously recognised in OCI is
88
reclassified from the equity to ‘other income’ in the Statement of Profit and Loss.
(c) Measured at fair value through profit or loss: A financial asset not classified as either amortised cost or FVOCI, is classified as
FVTPL. Such financial assets are measured at fair value with all changes in fair value, including interest income and dividend
income if any, recognised as ‘other income’ in the Statement of Profit and Loss.
Equity Instruments
All investments in equity instruments classified under financial assets are initially measured at fair value, the Company may, on initial
recognition, irrevocably elect to measure the same either at FVOCI or FVTPL The Company makes such election on an instrument-by-
instrument basis. Fair value changes on an equity instrument is recognised as 'Other Income' in the Statement of Profit and Loss unless
the Company has elected to measure such instrument at FVOCI. Fair value changes excluding dividends, on an equity instrument
measured at FVOCI are recognised in OCI. Amounts recognised in OCI are not subsequently reclassified to the Statement of Profit
and Loss. Dividend income on the investment in equity instruments are recognised as ‘other income’ in the Statement of Profit and
Loss.
Derecognition
The Company derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire, or it
transfers the contractual rights to receive the cash flows from the asset.
Impairment of Financial Asset
Expected credit losses are recognized for all financial assets subsequent to initial recognition other than financial assets in FVTPL
category.
For financial assets other than trade receivables, as per Ind AS 109, the Company recognises 12 month expected credit losses for all
originated or acquired financial assets if at the reporting date the credit risk of the financial asset has not increased significantly since
its initial recognition. The expected credit losses are measured as lifetime expected credit losses if the credit risk on financial asset
increases significantly since its initial recognition. The Company's trade receivables do not contain significant financing component
and loss allowance on trade receivables is measured at an amount equal to life time expected losses i.e. expected cash shortfall.
The impairment losses and reversals are recognised in Statement of Profit and Loss.
II. Financial Liabilities
Initial recognition and measurement
Financial liabilities are recognised when the Company becomes a party to the contractual provisions of the instrument. Financial
liabilities are initially measured at the amortised cost unless at initial recognition, they are classified as fair value through profit and
loss. In case of trade payables, they are initially recognised at fair value and subsequently, these liabilities are held at amortised cost,
using the EIR method.
Subsequent measurement
Financial liabilities are subsequently measured at amortised cost using the EIR method. Financial liabilities carried at fair value
through profit or loss are measured at fair value with all changes in fair value recognised in the Statement of Profit and Loss.
Derecognition
A financial liability is derecognised when the obligation specified in the contract is discharged, cancelled or expires.
Offsetting Financial Instrument
Financial assets and liabilities are offset and the net amount is included in the Balance Sheet where there is a legally enforceable right
to offset the recognized amounts and there is an intention to settle on a net basis or realize the assets and settle the liability simultaneously.
INVENTORIES
Inventories are valued at the lower of cost and net realisable value. Cost is computed on a weighted average basis. Cost includes all
costs of purchases net of input tax credit availed, conversion costs and other attributable expenses incurred in bringing the inventories
to their present location and condition and includes, where applicable, appropriate overhead cost based on normal level of activity.
The net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and
estimated costs necessary to make the sale.
Obsolete, slow moving and defective inventories are identified from time to time and, where necessary, a provision is made for such
inventories.

73
ASSETS HELD FOR SALE

Non-current assets or disposal groups comprising of assets and liabilities are classified as ‘held for sale’ when all of the following
criteria’s are met: (i) decision has been made to sell (ii) the assets are available for immediate sale in its present condition (iii) the
assets are being actively marketed and (iv) sale has been agreed or is expected to be concluded within 12 months of the Balance
Sheet date. Subsequently, such non-current assets and disposal groups classified as held for sale are measured at the lower of its
carrying value and fair value less costs to sell. Non-current assets held for sale are not depreciated or amortised.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents are short-term (three months or less from the date of acquisition), highly liquid investments that are readily
convertible into cash and which are subject to an insignificant risk of changes in value.
PROVISIONS AND CONTINGENT LIABILITIES
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable
that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be
made of the amount of the obligation. Provisions are measured at the best estimate of the expenditure required to settle the present
obligation at the Balance Sheet date.
If the effect of the time value of money is material, provisions are discounted to reflect its present value using a current pre-tax rate that
reflects the current market assessments of the time value of money and the risks specific to the obligation. When discounting is used,
the increase in the provision due to the passage of time is recognised as a finance cost.
Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be
confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the
Company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be
required to settle the obligation or a reliable estimate of the amount cannot be made.
REVENUE RECOGNITION
Revenue from sale of goods is recognized when effective control over goods is transferred to a customer as per the terms of the
contract. This is usually evidenced by a transfer of all the significant risks and rewards of ownership upon delivery of goods to the
customer, which in terms of timing is not materially different to the date of shipping. Revenue is measured at fair value of the
consideration received or receivable after deduction of any trade discount, incentive and other similar discounts and any taxes or
duties collected on behalf of the Government which are levied on sales such as goods and service tax, etc.
Income from export incentives such as duty drawback is recognised on accrual basis.
Interest income is recognized using the effective interest rate (EIR) method.
Dividend income on investments is recognised when the right to receive dividend is established.
EXPENDITURE
Expenses are accounted on accrual basis.
EMPLOYEE BENEFITS
Defined Contribution Plans
Contributions to defined contribution schemes such as employees’ state insurance, labour welfare fund, superannuation scheme,
employee pension scheme etc. are charged as an expense based on the amount of contribution required to be made as and when
services are rendered by the employees. Provident fund contribution in respect of certain employees, who are members of constituted
and approved trusts, the Company recognizes contribution payable to such trusts as an expense including any shortfall in interest
between the amount of interest realized by the investment and the interest payable to members at the rate declared by the Government
of India. In respect of other employees, provident funds are deposited with the government administered fund and charged as an
expense to the Statement of Profit and Loss.
The Company makes contribution to defined contribution pension plan. The contribution payable is recognized as an expense, when
an employee renders the related service.
Defined Benefit Plans
The Company also makes contribution to defined benefit pension and gratuity plan. The cost of providing benefits under the defined
benefit obligation is calculated by independent actuary using the projected unit credit method. Service costs and net interest expense
or income is reflected in the Statement of profit and loss. Gain or loss on account of remeasurements are recognised immediately
through other comprehensive income in the period in which they occur.
90
Other Long Term Employee Benefits

The employees of the Company are entitled to compensated leave for which the Company records the liability based on actuarial
valuation computed using projected unit credit method. These benefits are funded.
Termination Benefits
Termination benefits, in the nature of voluntary retirement benefits or termination benefits arising from restructuring, are recognised
in the Statement of Profit and Loss. The Company recognises termination benefits at the earlier of the following dates:
(a) when the Company can no longer withdraw the offer of those benefits; or
(b) when the Company recognises costs for a restructuring that is within the scope of Ind AS 37 and involves the payment of
termination benefits.
Benefits falling due more than 12 months after the end of the reporting period are discounted to their present value.
INCOME TAXES
Income tax expense for the year comprises of current tax and deferred tax. It is recognised in the Statement of Profit and Loss except
to the extent it relates to a business combination or to an item which is recognised directly in equity or in other comprehensive income.
Current tax is the expected tax payable/receivable on the taxable income/ loss for the year using applicable tax rates at the Balance
Sheet date, and any adjustment to taxes in respect of previous years. Interest income/ expenses and penalties, if any, related to
income tax are included in current tax expense.
Deferred tax is recognised in respect of temporary differences between the carrying amount of assets and liabilities for financial
reporting purposes and the corresponding amounts used for taxation purposes.
A deferred tax liability is recognised based on the expected manner of realisation or settlement of the carrying amount of assets and
liabilities, using tax rates enacted, or substantively enacted, by the end of the reporting period. Deferred tax assets are recognised only
to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Deferred tax assets
are reviewed at each reporting date and reduced to the extent that it is no longer probable the related tax benefit will be realised.
Current tax assets and current tax liabilities are offset when there is a legally enforceable right to set off the recognised amounts and
there is an intention to settle the asset and the liability on a net basis. Deferred tax assets and deferred tax liabilities are offset when
there is a legally enforceable right to set off current tax assets against current tax liabilities; and the deferred tax assets and the
deferred tax liabilities relate to income taxes levied by the same taxation authority.
EARNINGS PER SHARE
Basic earnings per share is computed by dividing the net profit for the period attributable to the equity shareholders of the Company
by the weighted average number of equity shares outstanding during the period. The weighted average number of equity shares
outstanding during the period and for all periods presented is adjusted for events, such as bonus shares, other than the conversion of
potential equity shares that have changed the number of equity shares outstanding, without a corresponding change in resources.
For the purpose of calculating diluted earnings per share, the net profit for the period attributable to equity shareholders and the
weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity Shares.
DIVIDEND DISTRIBUTION
Dividend paid (including income tax thereon) is recognized in the period in which the interim dividends are approved by the Board of
Directors or in respect of final dividend when approved by shareholders.
LEASES
Leases in which a substantial portion of the risks and rewards of ownership are retained by the lessor are classified as operating
leases. Payments and receipts under such leases are recognised to the Statement of Profit and Loss on a straight-line basis over the
term of the lease unless the lease payments to the lessor are structured to increase in line with expected general inflation to compensate
for the lessor’s expected inflationary cost increases, in which case the same are recognised as an expense in line with the contractual
term.
RECENT INDIAN ACCOUNTING STANDARDS (Ind AS)
Ministry of Corporate Affairs ("MCA"), through Companies (Indian Accounting Standards) Amendment Rules, 2019 and Companies
(Indian Accounting Standards) Second Amendment Rules, has notified the following new and amendments to Ind AS which the
Company has not applied as effective date for application of these amendments is annual period beginning on or after April 1, 2019.

73
Ind AS 116 Leases

Ind AS 116 will replace the existing leases standard, Ind AS 17 Leases. Ind AS 116 sets out the principles for the recognition,
measurement, presentation and disclosure of leases for both lessees and lessors. It introduces a single, on-balance sheet lease
accounting model for lessees. A lessee recognises right-of-use asset representing its right to use the underlying asset and a liability
representing its obligation to make lease payments.
The Company has only low value lease and short term lease assets, accordingly the management believes that the standard will not
have a significant impact on the Company's financial statement in the period of its initial application.
Ind AS 12 Income taxes (amendments relating to income tax consequences of dividend and uncertainty over
income tax treatments)
The amendment relating to income tax consequences of dividend clarify that an entity shall recognise the income tax consequences of
dividends in statement of profit and loss, other comprehensive income or equity according to where the entity originally recognised
those past transactions or events. The Company does not expect any impact from this pronouncement. It is relevant to note that the
amendment does not amend situations where the entity pays a tax on dividend which is effectively a portion of dividends paid to
taxation authorities on behalf of shareholders. Such amount paid or payable to taxation authorities continues to be charged to equity
as part of dividend, in accordance with Ind AS 12.
The amendment to Appendix C of Ind AS 12 specifies that the amendment is to be applied to the determination of taxable profit (tax
loss), tax bases, unused tax losses, unused tax credits and tax rates, when there is uncertainty over income tax treatments under Ind AS
12. It outlines the following: (1) the entity has to use judgement, to determine whether each tax treatment should be considered
separately or whether some can be considered together. The decision should be based on the approach which provides better
predictions of the resolution of the uncertainty (2) the entity is to assume that the taxation authority will have full knowledge of all
relevant information while examining any amount (3) entity has to consider the probability of the relevant taxation authority accepting
the tax treatment and the determination of taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates would
depend upon such probability. The Company does not expect any significant impact of the amendment on its financial statements.
Ind AS 19 Plan Amendment, Curtailment or Settlement
The amendments relating to 'Employee Benefits' require an entity:
• to use updated assumptions to determine current service cost and net interest for the remainder of the period after a plan amendment,
curtailment or settlement; and
• to recognise in profit or loss as part of past service cost, or a gain or loss on settlement, any reduction in a surplus, even if that
surplus was not previously recognised because of the impact of the asset ceiling.
The Company does not expect any significant impact of the amendment on its financial statements.
92
` in Lakhs
Gross Block Accumulated Depreciation & Amortisation Net Block
Balance Additions Disposals Balance Additions Disposals Balance Balance For the Adjustment Balance For the Adjustment Balance Balance Balance
as at as at as at as at year on as at year on as at as at as at
31.03.2017 31.03.2018 31.03.2019 31.03.2017 Disposals 31.03.2018 Disposals 31.03.2019 31.03.2019 31.03.2018
2A. PROPERTY PLANT AND EQUIPMENT
Land 1724.80 - - 1724.80 556.42 - 2281.22 - - - - - - - 2281.22 1724.80
Buildings on Freehold Land (including roads) 2539.69 40.52 - 2580.21 3048.58 - 5628.79 107.77 142.70 - 250.47 459.64 - 710.11 4918.68 2329.74
Buildings on Leasehold Land 34.41 8.40 42.81 8.73 - 51.54 4.08 3.59 7.67 4.12 - 11.79 39.75 35.14
Plant & Equipment 20014.30 1342.86 17.08 21340.08 1897.95 23238.03 3387.18 3543.97 16.95 6914.20 3454.10 10368.30 12869.73 14425.88
Electrical Installation & Equipment 779.98 - - 779.98 330.61 - 1110.59 42.29 77.94 - 120.23 97.73 - 217.96 892.63 659.75
Furniture & Fixtures 129.62 77.21 206.83 63.73 0.55 270.01 18.63 18.07 36.70 33.80 0.28 70.22 199.79 170.13
Motor Vehicles 241.83 7.81 128.84 120.80 4.63 8.16 117.27 69.01 66.20 74.99 60.22 32.12 8.16 84.18 33.09 60.58
Office Equipment 206.67 - 206.67 50.45 2.45 254.67 45.42 61.04 106.46 51.79 2.42 155.83 98.84 100.21
Annual Report 2018-19

Total Property, Plant and Equipment 25671.30 1476.80 145.92 27002.18 5961.10 11.16 32952.12 3674.38 3913.51 91.94 7495.95 4133.30 10.86 11618.39 21333.73 19506.23
2B. CAPITAL WORK-IN-PROGRESS - - - - - - - - 29.85 3422.11
2C. INTANGIBLE ASSETS
Computer Software etc. 7.03 - - 7.03 7.25 - 14.28 2.91 2.90 - 5.81 1.23 - 7.04 7.24 1.22
Total Intangible assets 7.03 - - 7.03 7.25 - 14.28 2.91 2.90 - 5.81 1.23 - 7.04 7.24 1.22
Note: The amortisation expense of Intangible assets have been included under " Depreciation and amortisation expense" in the Statement of Profit and Loss.
73
93
` in Lakhs
As at 31st March, 2019 As at 31st March, 2018
3. NON-CURRENT INVESTMENTS
Investment in Government/Trust Securities
(at amortised cost)
National Savings Certificate cost ` 500 (Previous Year - ` 500)
Lodged with Government Authority
Investment in Mutual Funds
(at fair value through other comprehensive income)
HDFC - Top 100 Fund
50,000 units of `10 each fully paid up 24.47 23.72
24.47 23.72
Investment in Equity instruments
Other than Trade (at fair value through other
comprehensive income)
QUOTED
Duncan Industries Limited
184 Equity Shares of ` 10 each fully paid up 0.02 0.02
Godfrey Phillips India Limited
1000 Equity Shares of ` 2 each fully paid up 11.58 8.21
Golden Tobacco Limited
50 Equity Shares of `10 each fully paid up 0.02 0.03
Housing Development Finance Corporation Limited
6,000 Equity Shares of ` 2 each fully paid up 118.04 109.54
HDFC Bank Limited
2,500 Equity Shares of ` 2 each fully paid up 57.91 47.15
187.57 164.95
UNQUOTED
Andhra Pradesh Gas Power Corporation Limited
1,39,360 shares of ` 10 each fully paid up 13.94 13.94
Twin Towers Premises Co-operative Society Limited
10 Shares of ` 50 each fully paid up
(Cost ` 500 , Previous Year - ` 500 )
Tobacco Institute of India - (Limited by Guarantee Maximum
Contribution ` 10.00 Lakhs)
CREF Finance Limited
50,00,000 Equity Shares of ` 10 each fully paid up
ITC Agrotech Finance and Investments Limited
23,82,500 Equity Shares of ` 10 each fully paid up
13.94 13.94
Total of Non-Current Investments 225.98 202.61
Aggregate amount of Quoted Investments - Market Value 212.04 188.67
Aggregate amount of Other Investments 13.94 13.94
94
` in Lakhs

Current Non-Current Current Non-Current
4. LOANS
Loans to Employees
Secured, considered good 1.28 13.38 1.51 14.85
Unsecured, considered good 0.18 - 0.18 -
TOTAL 1.46 13.38 1.69 14.85
5. OTHER FINANCIAL ASSETS

Balances with Banks:
- On Term Deposits with original maturity of more than 12 months
Lodged with Government Authorities - 1.77 - 1.77
Other financial assets
Interest accrued on Loans, Deposits, Investments, etc. 0.55 - 0.12 -
Other receivables
- On account of Foreign Currency Forward Contracts 120.66 - - -
TOTAL 121.21 1.77 0.12 1.77
6. INCOME TAXES
A. Income tax expense recognised in Statement of Profit and Loss
Current tax
Current tax for the year 13093.17 10201.84
Adjustments/(credits) related to previous years - Net (16.73) (245.64)
Total Current tax expense (a) 13076.44 9956.20
Deferred tax
Origination and reversal of temporary differences (693.42) (200.12)
Total Deferred tax expense (b) (693.42) (200.12)
TOTAL (a + b) 12383.02 9756.08
B. Income tax expense recognised in Other Comprehensive Income
Current tax
On item that will be not reclassified to statement of profit and loss
- Related to remeasurement gains/(losses) on defined benefit plans (75.27) -
Total Current tax expense (a) (75.27) -
Deferred tax
On item that will be not reclassified to statement of profit and loss
- Related to remeasurement gains/(losses) on defined benefit plans 28.51 26.26
- Related to change in fair value of equity instruments 0.62 -
On item that will be reclassified to statement of profit and loss
- Related to effective portion of hedging instruments in cash flow hedges 44.48 (7.37)
Total Deferred tax expense (b) 73.61 18.89
TOTAL (a+b) (1.66) 18.89
Reconciliation of estimated income tax expense at statutory income tax
rate to income tax expense reported in Statement of Profit and Loss is as follows:
Profit before tax 35067.45 27945.39
Statutory income tax rate 34.94% 34.61%
Expected income tax expense 12253.97 9671.34
Adjustment :
Effect of expenses not deductible for tax purposes 173.23 162.14
Others * (44.18) (77.40)
Income tax expense recognised in Statement of Profit and Loss 12383.02 9756.08
* Others include adjustments related to previous years

73
` in Lakhs
B. Significant components of Deferred Tax Assets/(Liabilities)

Opening Recognised in Recognised Closing
Balance profit or loss in/reclassified Balance
2018-19 in OCI
Deferred tax assets in relation to:
- Employees' separation and retirement 668.23 107.66 (28.51) 747.38
- State and Central Taxes, etc,. 3099.61 556.52 - 3656.13
- Other temporary differences 172.30 25.01 - 197.31
Total deferred tax assets 3940.14 689.19 (28.51) 4600.82
Deferred tax liabilities in relation to:
- Fiscal allowances on Property, Plant and Equipment, etc. 1080.96 (304.35) - 776.61
- Cash flow hedges (2.32) - 44.48 42.16
- Unrealised gain on Equity instruments carried at FVTPL or FVOCI - - 0.62 0.62
Total deferred tax liabilities 1458.49 (4.23) 45.10 1499.36
Deferred Tax Assets - net 2481.65 693.42 (73.61) 3101.46
2017-18
Deferred tax assets in relation to:
- Employees' separation and retirement 629.46 65.03 (26.26) 668.23

- State and Central Taxes, etc,. 3063.05 36.56 - 3099.61
Total deferred tax assets 3858.39 108.01 (26.26) 3940.14
Deferred tax liabilities in relation to:
- Fiscal allowances on Property, Plant and Equipment, etc. 1489.96 (409.00) - 1080.96
- Cash flow hedges 5.05 - (7.37) (2.32)
Total deferred tax liabilities 1557.97 (92.11) (7.37) 1458.49
Deferred Tax Assets - net 2300.42 200.12 (18.89) 2481.65

Current Non-Current Current Non-Current
7. OTHER ASSETS
Capital Advances - 50.81 - 236.92
Advances other than capital advances
Security Deposits
- With Statutory Authorities - 0.55 - 0.55
- Others - 60.44 - 60.33
Advances recoverable in cash or in kind or for value to be received 184.86 - 203.77 -
Other Advances
- Prepaid Expenses 241.73 - 245.27 -
- Balance with Statutory/Government Authorities 4508.07 - 6583.36 -
Other Receivables * 1.18 - 0.20 -
TOTAL 4935.84 111.80 7032.60 297.80
* Includes receivables on account of export incentives
96
` in Lakhs
8. INVENTORIES
(At lower of cost and net realisable value)
Raw Materials including packing materials 24549.36 22767.59
Work-in-Progress 841.23 666.84
Finished Goods 2641.62 1742.51
Stores and Spares 152.75 110.54
TOTAL 28184.96 25287.48
The above includes goods in transit - -
The cost of inventories recognised as an expense in respect of
write- down of inventory to net realisable value. 4.93 95.61
9. CURRENT INVESTMENTS
Other than Trade and quoted - (at fair value through profit or loss)
Investment in Mutual Funds
Aditya Birla Sun Life Savings Fund - Growth - Direct Plan
7,89,632 (2018-7,89,632) units of `100 each fully paid up 2935.52 2715.74
Aditya Birla Sun Life Liquid Fund- Growth - Direct Plan
17,29,463 (2018- 16,60,025) units of `100 each fully paid up 5195.93 4636.70
Aditya Birla Sun Life Money Manager Fund - Growth - Direct Plan
2,09,094 (2018-Nil) units of `100 each fully paid up 526.29 -
DSP Liquidity Fund - Direct Plan - Growth
HDFC Liquid Fund - Direct Plan - Growth
HDFC Floating Rate Debt Fund - Direct Plan - Wholesale Growth Option
ICICI Prudential Savings Fund - Direct Plan - Growth
ICICI Prudential Liquid Fund - Direct Plan - Growth
Kotak Liquid - Direct Plan - Growth
1,92,493 (2018- Nil) units of `1000 each fully paid up 7284.58 -
Reliance Low Duration Fund - Direct Growth Plan - Growth Option
Reliance Liquid Fund - Direct Plan Growth Plan - Growth Option
SBI Liquid Fund - Direct - Growth
Total of Current Investments 57305.88 41409.57
Aggregate amount of quoted Investments - Market Value 57305.88 41409.57
10. TRADE RECEIVABLES

Unsecured, considered good 1431.74 2733.09
(Refer Note 31)
TOTAL 1431.74 2733.09

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` in Lakhs
11. CASH AND CASH EQUIVALENTS

Balances with Banks
- On Current Accounts 1637.65 2851.47
- On Term deposits with original maturity of less than three months 1000.00 -
Cash including cheques on hand 0.95 0.64
TOTAL 2638.60 2852.11
12. OTHER BANK BALANCES

Earmarked Balances
- On Unclaimed Ordinary Dividend Account 1047.21 906.71
TOTAL 1047.21 906.71
13. CURRENT TAX ASSETS (NET)

Current taxation (net of tax provision) 192.77 261.72
TOTAL 192.77 261.72

No. of Shares ` in Lakhs No. of Shares ` in Lakhs
14. EQUITY SHARE CAPITAL
AUTHORISED
Ordinary Shares of ` 10 each 5,00,00,000 5000.00 5,00,00,000 5000.00
Cumulative Redeemable Preference Shares of ` 100 each 50,00,000 5000.00 50,00,000 5000.00
10000.00 10000.00
ISSUED AND SUBSCRIBED
Ordinary Shares of ` 10 each fully paid up 1,54,41,920 1544.19 1,54,41,920 1544.19
There is no movement in number of Ordinary Shares during the year.
Details of shareholders holding more than 5% of Ordinary Shares:
Name of the Shareholders No. Lakhs % holding No. Lakhs % holding
Bright Star Investments Private Limited 40.07 25.95 40.07 25.95
The Raleigh Investment Company Limited 36.20 23.45 36.20 23.45
Tobacco Manufacturers (India) Limited 12.79 8.28 12.79 8.28
Mathews India Fund 11.67 7.56 11.67 7.56
HDFC Trustee Company Limited
A/c HDFC Midcap Opportunities Fund 10.43 6.76 10.43 6.75
RIGHTS, PREFERENCES AND RESTRICTIONS ATTACHED TO ORDINARY SHARES

The Company has only one class of Ordinary Shares outstanding, having a par value of ` 10 each, that rank pari passu in all
respects including voting rights and entitlement to dividend.
15. PROVISIONS
Non-Current
Provision for Employee Benefits
Retirement and Other benefits (Refer Note 32) 1849.74 1415.15
TOTAL 1849.74 1415.15
98
` in Lakhs
16. TRADE PAYABLES

Payables for Goods and Services
Total outstanding dues of micro enterprises and small enterprises 30.01 32.28
Total outstanding dues of creditors other than micro enterprises
and small enterprises 8271.35 5776.67
TOTAL 8301.36 5808.95
DUE TO MICRO AND SMALL ENTERPRISES
a) Principal amount remaining unpaid 30.01 32.28
b) Interest due remaining unpaid - -
c) Interest paid, in terms of Section 16 of MSMED Act, along with the
amount of the payment made beyond the appointed day during the year - -
d) Interest due and payable for the period of delay in making payment - -
e) Interest accrued and remaining unpaid - -
f) Interest remaining due and payable - disallowable - -
Dues to Micro and Small Enterprises have been determined to the extent such parties
have been identified on the basis of information collected by the Management.
17. OTHER FINANCIAL LIABILITIES

Current
Unpaid/Unclaimed Dividends 1047.21 906.71
Security Deposits 2.98 3.10
Other Liabilities
- On account of Foreign Currency Forward Contracts - 6.71
- Others (including payable for property, plant and equipment, etc.) 220.18 392.18
TOTAL 1270.37 1308.70
There is no amount due and outstanding to be credited to Investor Education and
Protection Fund as at the year end.
18. OTHER CURRENT LIABILITIES

Advances from Customers 7886.55 3030.41
Statutory Liabilities 34973.81 36641.05
TOTAL 42860.36 39671.46
The Company has ongoing disputes relating to tax matters under various State and Central Acts pending before various judicial
forums. These litigation are subject to many uncertainties, and generally, it is not possible to predict the outcome of any particular
litigation pending, or to reasonably estimate the amount of range of any possible loss.
The Company has reviewed all its pending litigations and proceedings and believes that it has valid bases for appeals and
intends to defend all such pending disputes vigorously. However, as a matter of prudence, it has adequately recognised the
disputed amount in the books wherever required and is reflected above under 'Statutory Liabilities'. These mainly comprise:
(a) Income Tax : Matters relating to disallowed expenditure, tax treatment of certain expenses claimed as deductions, and
computation of, or eligibility of certain tax incentives or allowances ` 1702.85 Lakhs (2018: ` 1702.85 Lakhs).
(b) Central Excise and Service Tax : Matters mainly relating to classification and taxability on manufacture and consumption of
input raw material; and availment of input tax credit on goods and services - ` 2956.48 Lakhs (2018: ` 1504.35 Lakhs).
(c) State Acts : Matters mainly relating to taxability of finished goods under a particular State Act on occurrence of specified
taxable event - ` 10916.74 Lakhs (2018: ` 10823.86 Lakhs).
Contingent liabilities where applicable are disclosed in the financial statements (Refer Note 27).

73
` in Lakhs
19. REVENUE FROM OPERATIONS
Particulars in respect of sales (Gross)
Cigarettes (Refer Note 33) 94381.45 110787.67
Unmanufactured Tobacco 23889.66 24960.02
118271.11 135747.69
Other Operating Income
Scrap Sales 115.14 81.62
Other receipts 24.36 34.24
TOTAL 118410.61 135863.55
20. OTHER INCOME
Interest on Loans and Deposits, etc. 5.80 8.13
Dividend Income from:
Equity Instruments measured at FVOCI held at the end of reporting period 4.35 4.47
Other gains and losses from:
Net gain recognised on sale of property, plant and equipment, etc. 9.86 165.16
Net gain arising on financial assets mandatorily measured at FVTPL* 3661.34 2121.16
Gain on foreign exchange (Net) 119.91 81.89
Other non-operating Income 88.73 81.59
TOTAL 3889.99 2462.40
* Includes ` 2813.03 Lakhs (2018 - ` 1205.52 Lakhs) being net gain arising on
sale of Investments
21. COST OF MATERIALS CONSUMED
Raw Materials Consumed *
Opening Stock 22767.59 21338.53
Purchases 57745.96 47753.49
80513.55 69092.02
Less: Closing Stock 24549.36 22767.59
TOTAL 55964.19 46324.43
The above includes cost of unmanufactured tobacco sold -
Value ` 21041.45 Lakhs (2018 - ` 21987.18 Lakhs).
* Includes Packing Material
22. CHANGES IN INVENTORIES OF FINISHED GOODS AND WORK-IN-PROGRESS
(a) (Increase)/Decrease in Finished Goods
Opening Stock 1742.51 10426.56
Closing Stock 2641.62 1742.51
(899.11) 8684.05
(b) Increase/(Decrease) in Excise Duties on Finished Goods (Refer Note 33) 126.01 (8373.58)
(c) (Increase)/Decrease in Work-in-Progress
Opening Stock 666.84 1061.56
Closing Stock 841.23 666.84
(174.39) 394.72
TOTAL (947.49) 705.19
23. EMPLOYEE BENEFITS EXPENSES

Salaries and wages 8241.48 7546.58
Contribution to Provident and other funds 447.34 902.59
Staff welfare expenses 537.30 470.35
TOTAL 9226.12 8919.52
100
` in Lakhs

24. OTHER EXPENSES
Insurance 165.13 122.57
Consumption of Stores and Spares 608.70 535.05
Power and Fuel 890.30 729.45
Rent 326.61 329.52
Repairs
Buildings 58.24 25.96
Machinery 98.34 87.40
Others 34.67 40.76
Rates and Taxes 835.20 711.44
Outward Freight 1762.80 1441.57
Sales Promotion Expenses 487.50 669.25
Distribution Expenses 249.90 659.79
Miscellaneous 4125.40 3408.97
Payment to Auditors (see note (a) below) 46.25 49.10
Corporate Social Responsibility (see note (b) below) 495.75 468.50
Directors' Sitting Fees & Commission 161.40 129.25
TOTAL 10346.19 9408.58
(a) Payment to Auditors

Audit fees 30.00 27.00
Tax Audit fees 2.00 2.00
Limited Reviews 6.00 6.00
Fees for certification 5.55 2.25
Fees for audit related services - 8.00
Reimbursement of expenses 2.70 3.85
46.25 49.10
(b) Corporate Social Responsibility (CSR)
CSR amount required to be spent as per Section 135 of the Companies Act, 2013,
read with Schedule VII thereof, by the Company during the year is ` 495.75 Lakhs
(2018 - ` 468.50 Lakhs).
The details of actual expenditure related to CSR is as under:
(i) On Construction/Acquisition of any asset - -
(ii) For purposes other than (i) above (Revenue account) 495.75 468.50
495.75 468.50
The Company does not carry any provisions in respect of expenditure under CSR
for the current year and previous year.
25. EARNINGS PER SHARE
Earnings per Share is computed as under:
(a) Profit for the year (` in Lakhs) 22684.43 18189.31
(b) Weighted average number of Ordinary Shares 1,54,41,920 1,54,41,920
(c) Basic Earnings Per Share (Face Value per Share - ` 10) ` 146.90 117.79
(d) Diluted Earnings Per Share (Face Value per Share - ` 10) ` 146.90 117.79
26. EXPENDITURE ON RESEARCH & DEVELOPMENT
On Capital account 300.92 74.26
On Revenue account 681.48 536.58
982.40 610.84

73
27. CONTINGENT LIABILITIES AND COMMITMENTS

(a) Contingent Liabilities
(i) Claims against the Company not acknowledged as debts ` 44.40 Lakhs ( 2018 - ` 336.92 Lakhs)
These Comprise -
Excise duty, service tax and customs duty matters ` 40.15 Lakhs ( 2018 - ` 332.67 Lakhs)
Other matters related to employees/ex-employees, etc. ` 4.25 Lakhs ( 2018 - ` 4.25 Lakhs)
(ii) In addition to the above, the Company is subject to certain other litigations, in the ordinary course of business and the
industry in which it operates in, which are pending.
(iii) It is not practicable for the Company to estimate the closure of these issues and the consequential timings of cash
outflows and estimate of financial effect, if any, in respect of the above as its determinable only on occurrence of
uncertain future events/receipt of judgements pending at various forums.
(b) Commitments
Estimated amount of contracts remaining to be executed on Capital Account (not provided for) - ` 718.31 Lakhs (2018 -
` 2015.33 Lakhs).
28. FUTURE LEASE OBLIGATIONS

The Company has entered into various operating lease agreements and the amounts paid under such agreements have been
charged to revenue as Rent under Note 24. All these agreements are cancellable in nature.
` in Lakhs
29. RELATED PARTY TRANSACTIONS DURING THE YEAR
(a) Company having significant influence
British American Tobacco Group
- Dividends paid, to
• The Raleigh Investment Company Limited 2805.82 2715.31
• Tobacco Manufacturers (India) Limited 991.18 959.21
• Rothmans International Enterprises Limited 51.57 49.91
(b) Remuneration to Key Managerial Personnel
(i) Executive Directors
Mr. N. Sai Sankar (upto 27th November, 2017)
Mr. Devraj Lahiri
Remuneration*:
- Short - term benefits 236.85 415.37
- other remuneration 19.29 105.28
* includes ` 22.69 Lakhs (2018- ` 23.34 Lakhs) subject to shareholders approval
(ii) Non - Executive Directors
Mr. Raymond S Noronha (upto 12th April, 2018)
Mr. Pradeep V. Bhide (w.e.f. 12th April, 2018)
Mr. S Thirumalai
Ms. Mubeen Rafat
Mr. Ramakrishna V Addanki (upto 14th December, 2018)
Mr. Naresh Kumar Sethi (w.e.f. 14th December, 2018)
Dividend Paid 0.02 0.02
Sitting fees and Commission 161.40 129.25
102
` in Lakhs

30. SEGMENT REPORTING
The chief operating decision-maker (CODM) evaluates the Company's performance
and allocates resources at an overall level considering the business and industry its
operates in. Accordingly, the Company’s business activity primarily falls within a
single operating segment viz. Tobacco and related products. Therefore, the disclosures
as per Ind AS 108 - 'Operating Segments' is not applicable.
Geographical segments considered for disclosure mainly consists of sales within
India and sales outside India, information in respect thereof is as under:
(a) Sales within India 103515.88 121461.15
(b) Sales outside India 14755.23 14286.54
118271.11 135747.69
The entire activity pertaining to sales outside India is carried out from India,
hence all segment assets are considered entirely to be in India.
31. FINANCIAL INSTRUMENTS AND RELATED DISCLOSURES

A CAPITAL MANAGEMNET
The Company's financial strategy aims to provide adequate capital to its business for growth on a going concern basis
thereby creating sustainable stakeholder value. The Company funds its operations mainly through internal accruals.
B CATEGORIES OF FINANCIAL INSTRUMENTS - FAIR VALUE MEASUREMENT AND FAIR VALUE HIERARCHY
The fair value of the financial assets and liabilities is defined as the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants at the measurement date. Methods and assumptions
used to estimate the fair value are consistent with those used for the earlier period.
Financial assets and liabilities are measured at fair value as at Balance Sheet date as under:
i) The fair value of investment in government securities and quoted investment in equity shares is based on the current bid
price of respective investments as at the Balance Sheet date.
ii) The fair value of investments in mutual fund units is based on the net asset value (‘NAV’) as stated by the issuers of these
mutual fund units in their published statements as at Balance Sheet date. NAV represents the price at which the issuer
will issue further units of mutual fund as well as the price at which issuers will redeem such units from the investors.
iii) The fair values of the derivative financial instruments has been determined using valuation techniques with market
observable inputs such as foreign exchange spot rates and forward rates as at end of reporting period, yield curves,
volatility, etc., as applicable.
iv) Cash and cash equivalents (except for investments in units of mutual fund), trade receivables, trade payables and other
current financial assets and liabilities (except derivative financial instruments), have fair values that approximate to their
carrying amounts due to their short-term nature.
Fair value of the financial instruments have been classified into various fair value hierarchies based on the following three
levels:
Level 1 - Quoted prices for identical assets or liabilities in an active market.
Level 2 - Directly or indirectly observable market inputs, other than Level 1 inputs; and
Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).
If one or more of the significant inputs is not based on observable market data, the fair value is determined using generally
accepted pricing model based on a discounted cash flow analysis, with the most significant input being the discount rate
that reflects the credit risk of counterparty.
The following table shows the carrying amount and fair value of financial assets and liabilities, including their levels in the
fair value hierarchy:

73
` in Lakhs
Note Fair Value As at 31st March, 2019 As at 31st March, 2018
Particulars Hierarchy Carrying Fair Carrying Fair
(Level) Value Value Value Value
FINANCIAL ASSETS
Measured at Fair value through OCI
i) Equity Instruments 3 Level 1 212.04 212.04 188.67 188.67
ii) Equity Instruments 3 Level 3 13.94 13.94 13.94 13.94
Sub-total 225.98 225.98 202.61 202.61
Measured at Fair value through Profit and Loss
i) Investment in Mutual Funds 9 Level 1 57305.88 57305.88 41409.57 41409.57
Sub-total 57305.88 57305.88 41409.57 41409.57
Derivatives measured at fair value
i) Foreign exchange forward contracts 5 Level 2 120.66 120.66 - -
Sub-total 120.66 120.66 - -
Measured at amortised cost
i) Investments in Government Securities 3 -
ii) Loans 4 - 14.84 14.84 16.54 16.54
iii) Other Financial Assets 5 - 2.32 2.32 1.89 1.89
iv) Trade receivables 10 - 1431.74 1431.74 2733.09 2733.09
v) Cash and cash equivalents 11 - 2638.60 2638.60 2852.11 2852.11
vi) Other bank balances 12 - 1047.21 1047.21 906.71 906.71
Sub-total 5134.71 5134.71 6510.34 6510.34
Total financial assets 62787.23 62787.23 48122.52 48122.52
FINANCIAL LIABILITIES
Derivatives measured at fair value
i) Foreign exchange forward contracts 17 Level 2 - - 6.71 6.71

Sub-total - - 6.71 6.71
Measured at amortised cost
i) Trade Payables 16 - 8301.36 8301.36 5808.95 5808.95

ii) Other financial liabilities 17 - 1270.37 1270.37 1301.99 1301.99
Sub-total 9571.73 9571.73 7110.94 7110.94
Total financial liabilities 9571.73 9571.73 7117.65 7117.65
There were no significant changes in the classification and no significant movements between the fair value hierarchy classifications
of assets and liabilities during FY 2018-19.
104
C. FINANCIAL RISK MANAGEMENT OBJECTIVES

The Company's risk management framework anchored in its policies and procedures and internal financial controls aim to
ensure that the Company’s business activities that are exposed to a variety of financial risks namely liquidity risk, market
risks, credit risk and foreign currency risk are identified at an early stage and managed within acceptable and approved
risk parameters in a disciplined and consistent manner and in compliance with applicable regulations.
Liquidity Risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. Cash flow
from operating activities provides the funds to service the financial liabilities on a day-to-day basis. The Company’s approach
in managing liquidity is to ensure that it will have sufficient funds to meet its liabilities when due without incurring unacceptable
losses. In doing this, management considers both normal and stressed conditions. The Company maintained a cautious
liquidity strategy, with a positive cash balance throughout the year ended 31st March, 2019 and 31st March, 2018.
The Company’s Current assets aggregate to ` 95859.67 Lakhs (2018 - ` 80485.09 Lakhs) including Current investments,
Cash and cash equivalents and Other bank balances of ` 60991.69 Lakhs (2018 - ` 45168.39 Lakhs) against an aggregate
Current liability of ` 52432.09 Lakhs (2018 - ` 46789.11 Lakhs); Non-current liabilities amounting to ` 1849.74 Lakhs
(2018 - ` 1415.15 Lakhs) on the reporting date. Further, the Company's total equity stood at ` 66403.05 Lakhs (2018 -
` 58209.07 Lakhs). Accordingly, liquidity risk or the risk that the Company may not be able to settle its dues as they become
due does not exist. This excludes the potential impact of extreme circumstances that cannot be reasonably predicted, such as
natural disasters.
Market Risks
The Company does not trade in equity instruments; it continues to hold certain investments in equity for long term value
accretion which are measured at fair value through Other Comprehensive Income. The value of investment in such equity
instruments as at 31st March, 2019 is ` 225.98 Lakhs (2018 - ` 202.61 Lakhs).
The Company's investments are predominantly held in fixed deposits and debt schemes of mutual funds. The decision
making is centralised and administered under a set of approved policies and procedures guided by the principles of safety,
liquidity and returns. This ensures that investments are only made within acceptable risk parameters after due evaluation.
Fixed deposits are held with highly rated banks and companies and have a short to medium tenure and accordingly, are not
subject to interest rate volatility. Investment in debt schemes of mutual funds are susceptible to market price risk that arise
mainly from change in interest rate from time to time which may impact the return and value of such investments. However,
given the relatively short tenure of underlying portfolio of such mutual fund schemes in which the Company has invested,
such price risk is not significant.
As the Company is debt-free and its liabilities do not carry interest, the exposure to interest rate risk from the perspective of
Financial Liabilities is negligible.
Credit Risk
Credit risk is the risk of financial loss to the Company if a customer or counter-party fails to meet its contractual obligations.
The Company’s customer base is large and diverse and credit is extended in business interest in accordance with well laid out
guidelines issued centrally. Exceptions, if any, are approved by appropriate authority after due consideration of the customers
credentials and financial capacity, trade practices and prevailing business and economic conditions. Our historic experience
of collecting receivables is high and accordingly, the credit risk is low. Hence, trade receivables are considered to be a single
class of financial assets.
The value of Trade Receivables as at 31st March, 2019 is ` 1431.74 Lakhs (2018 - ` 2733.09 Lakhs)
Further, the Company maintains exposure in cash and cash equivalents, term deposits with banks, government securities,
money market liquid mutual funds and derivative instruments with financial institution. The Company has set counter-parties
limits based on multiple factors including financial position, credit rating, etc.
The Company's maximum exposure to credit risk as at 31st March, 2019 and 31st March, 2018 is the carrying value of each
class of financial assets.

73
Foreign Currency Risks

The Company undertakes transactions denominated in foreign currency (mainly US Dollar, Euro and Pound Sterling) which
are subject to the risk of exchange rate fluctuations. Financial assets and liabilities denominated in foreign currency, arising
out of such transactions, are also subject to reinstatement risks.
The Company has established risk management policies to hedge the volatility arising from exchange rate fluctuations in
respect of firm commitments and highly probable forecast transactions, through foreign exchange forward contracts. The
proportion of forecast transactions that are to be hedged is decided based on the size of the forecast transaction and market
conditions. As the counterparty for such transactions are Scheduled banks, the risk of their non-performance is considered to
be insignificant.
The use of these foreign exchange forward contracts are intended to reduce the risk or cost to the Company and are not
intended for trading or speculation purpose.
The information on such Derivative Instruments is as follows:
Forward exchange contracts designated under Hedge Accounting that were outstanding on respective reporting dates:
` in Lakhs
Currency Pair Currency Buy Sell Buy Sell

USD/INR INR - 3648.18 - 2976.06
The aforesaid hedges have a maturity of less than 1 year as on respecting reporting dates.
The carrying amount of foreign currency denominated financial assets and liabilities, are as follows:
` in Lakhs
Currency Pair Currency Assets Liabilities Assets Liabilities

USD/INR INR 1168.65 1.18 2375.09 55.82
EUR/INR INR - 1.58 - 9.19
Hedges of foreign currency risk and derivative financial instrument

Foreign exchange forward contracts that are designated as cash flow hedges and qualify for hedge accounting are fair
valued at each reporting date and the resultant gain or loss is recognised in Other Comprehensive Income under 'Cash Flow
Hedge' in Equity to the extent considered highly effective and are reclassified into the statement of profit & loss upon occurrence
of the hedged transactions. Gain or loss on derivative instruments that are either not designated as cash flow hedges or
designated as cash flow hedges to the extent considered ineffective is recognised in the statement of profit and loss.
The movement in the cash flow hedging reserve in respect of designated cash flow hedges is summarised below:
` in Lakhs
Particulars 2019 2018
At the beginning of the year (4.39) 9.53
Add: Changes in the fair value of effective portion of matured cash flow hedges
during the year (147.91) 82.11
Add: Changes in the fair value of effective portion of outstanding
cash flow hedges during the year 120.66 (6.71)
Less: Amounts transferred to the statement of profit and loss on occurrence of
transaction during the year (152.29) 91.64
(Less)/Add: Deferred tax (42.16) 2.32
At the end of the year 78.49 (4.39)
Foreign Currency Sensitivity
A 1% strengthening of the INR against key currencies to which the company is exposed (net of hedges) would have led to the
profit before tax for the year ended 31st March, 2019 to be lower by ` 11.66 Lakhs (2018 - ` 23.10 Lakhs) and total equity
(pre-tax) as at 31st March, 2019 would change by ` 11.66 Lakhs (2018 - ` 23.10 Lakhs).
A 1% weakening of the INR against these currencies would have led to an equal but opposite effect.
106
32. EMPLOYEE BENEFIT PLANS

Employee Retirement Benefit Plans of the Company include Provident fund, Retirement Allowances, Gratuity, Pension and Leave
Encashment. These plans expose the Company to a number of actuarial risks such as investment risk, interest rate risk, longevity
risk and inflation risk. The Company has developed policy guidelines within the applicable statutory framework, for allocation of
assets to different classes with the objective of maintaining the right balance between risks and long-term returns. Further,
investments are well diversified, such that the failure of any single investment would not have a material impact on the overall
level of assets.
Description of Plans
(i) Provident Fund
Eligible employees of the Company receive benefits under the Provident Fund which are defined contribution/benefit plans
wherein both the Company and the employees make monthly contributions equal to a specified percentage of the covered
employees' salary. These contributions are made to the Funds administered and managed by the Govt. of India/Company's
own Trust. The Company's own trust plan envisages guarantee of interest at the rate notified by the Provident Fund authority.
The Company's contributions along with interest shortfall, if any, are charged to revenue in the year they are incurred.
Expenditure for the year amounted to ` 246.70 Lakhs ( 2018 - ` 252.24 Lakhs).
Major Category of Plan Assets as a % of the Total Plan Assets of the Company's Own Provident Fund Trust :
2019 2018
Central Government Securities [%] 22.1 24.1
State Government Securities [%] 41.7 39.4
High Quality Corporate Bonds [%] 32.7 33.0
Equity Instruments [%] 3.5 3.1
Cash and cash equivalent [%] 0.0 0.4
(ii) Retirement Allowance
The Company has an unfunded defined benefit retirement allowance scheme for its employees in the workmen category.
Liability with regard to such scheme is determined on actuarial valuation performed by an independent actuary at each
balance sheet date using projected unit credit method and charged to revenue in the period determined - ` 498.86 Lakhs;
(2018-` 435.17 Lakhs). Consequently, Liability recognised in the Balance sheet as at 31st March, 2019 ` 1821.78 Lakhs;
(2018-` 1372.97 Lakhs).
(iii) Gratuity
In accordance with 'the Payment of Gratuity Act, 1972' of India, the Company provides for gratuity, a defined retirement
benefit plan ( the 'Gratuity Plan') covering eligible employees. Liabilities with regard to such Gratuity Plan are determined on
actuarial valuation performed by an independent actuary at each balance sheet date using projected unit credit method
and are charged to revenue in the period determined. The Gratuity Plan is a funded Plan administered by Company's own
Trust which has subscribed to " Group Gratuity Scheme" of Life Insurance Corporation of India.
(iv) Pension Fund
The Company has a defined contribution pension scheme to provide pension to the eligible employees. The Company
makes monthly contributions equal to a specified percentage of the covered employees' salary to a notified pension scheme
under National Pension Scheme of the Government of India. The Company's contributions are charged to revenue in the
period they are incurred -` 79.00 Lakhs ( 2018 -` 93.93 Lakhs).
In addition to the above, the Company has a funded defined benefit pension scheme for its employees in the workmen
category. Liability with regard to such defined benefit plan are determined on actuarial valuation performed by an independent
actuary at each balance sheet date using projected unit credit method and are charged to revenue in the period determined.
This plan is administered by the Company's own Trust which has subscribed to "Group Pension Scheme " of Life Insurance
Corporation of India.
(v) Leave Encashment
The Company has a leave encashment scheme whereunder, leaves are both accumulating and non-accumulating in nature.
The expected cost of accumulating leaves expected to be paid/availed as a result of the unused entitlement that has accumulated
as at the balance sheet date is determined on actuarial valuation performed by an independent actuary at each balance
sheet date using projected unit credit method and are charged to revenue in the period determined. The Scheme its fully
funded by way of subscription to the "Leave Encashment' of Life Insurance Corporation of India. Compensation, if any, for
non-accumulating leaves is charged to revenue in the period in which the absences occurs.

73
` in Lakhs
Particulars Gratuity Pension Gratuity Pension
A Components of Employer Expense
Recognised in Profit or Loss
i) Current Service Cost 139.67 5.97 168.19 6.03
ii) Past Service Cost - - 398.58 -
iii) Net Interest Cost (21.01) (2.99) (17.84) (2.79)
iv) Total expense recognised in the statement of profit and loss 118.66 2.98 548.93 3.24
Remeasurements recognised in Other Comprehensive Income
v) Return on plan assets (excluding amounts included in Net interest cost) 14.75 0.59 41.77 (1.15)
vi) Effect of changes in demographic assumptions 0.36 (0.11) - -
vii) Effect of changes in financial assumptions - - (192.40) (2.81)
viii) Changes in asset ceiling (excluding interest income) - - - -
ix) Effect of experience adjustments 196.16 3.65 (42.05) 0.35
x) Total remeasurements included in Other Comprehensive Income 211.27 4.13 (192.68) (3.61)
xi) Total defined benefit cost recognised in Profit and Loss and
Other Comprehensive Income (iv+x) 329.93 7.11 356.25 (0.37)
The current service cost and net interest cost for the year pertaining to Pension and Gratuity expenses have been recognised in
“Contribution to Provident and other funds” under Note 23. The remeasurements of the net defined benefit liability are included in
Other Comprehensive Income.
B Net Asset/(Liability) recognised in Balance Sheet

i) Present value of Defined Benefit Obligation 4201.70 108.49 3751.20 95.53
ii) Fair Value of Plan Assets 4181.77 136.43 3719.95 130.58
iii) Status [Surplus/(Deficit)] (19.93) 27.94 (31.25) 35.05
C Changes in Defined Benefit Obligation (DBO)
i) Present value of DBO at the beginning of the year 3751.20 95.53 3619.18 99.26
ii) Current Service Cost 139.67 5.97 168.19 6.03
iii) Past Service Cost - - 398.58 -
iv) Interest Cost 275.30 7.03 238.00 6.47
v) Remeasurement (gains)/losses:
Effect of changes in demographic assumptions 0.36 (0.11) - -
Effect of changes in financial assumptions - - (192.40) (2.81)
Changes in asset ceiling (excluding interest income) - - - -
Effect of experience adjustments 196.16 3.65 (42.05) 0.35
vi) Curtailment Cost/(Credits) - - - -
vii) Settlement Cost/(Credits) - - - -
viii) Benefits paid (160.99) (3.58) (438.30) (13.77)
ix) Present value of DBO at the end of the year 4201.70 108.49 3751.20 95.53
D Change in Fair Value of Assets
i) Plan Assets at the beginning of the year 3719.95 130.58 3589.85 133.94
ii) Interest Income 296.31 10.02 255.84 9.26
iii) Remeasurement gains/(losses) on plan assets (14.75) (0.59) (41.77) 1.15
iv) Actual Company Contributions 341.25 - 354.33 -
v) Benefits paid (160.99) (3.58) (438.30) (13.77)
vi) Plan Assets at the end of the year 4181.77 136.43 3719.95 130.58
108
` in Lakhs

Particulars Gratuity Pension Gratuity Pension
E Estimate of Employers' Expected
Contribution for the next year 406.12 17.82 395.80 3.91
F Acturial Assumptions Discount Expected Discount Expected

Rate Return on Rate Return on
(%) Plan (%) Plan
Assets (%) Assets (%)
i) Gratuity 7.50 7.50 7.50 7.50

ii) Pension 7.50 7.50 7.50 7.50
The estimates of future salary increases, considered in actuarial valuations take account of inflation, seniority, promotion and other
relevant factors such as supply and demand factors in the employment market.
G Investment details of the Plan assets

In the absence of detailed information regarding plan assets which are funded with Life Insurance Corporation of India, the
composition of each major category of plan assets, the percentage or amount of each category to the fair value of plan assets
is not disclosed.
H Basis used to determine the Expected Rate of Return on Plan Assets
The expected rate of return on plan assets is based on the current portfolio of assets, investment strategy and market scenario.
In order to protect the capital and optimize returns within acceptable risk parameters, the plan assets are well diversified.
I Sensitivity Analysis
The Sensitivity Analysis below has been determined based on reasonably possible change of the respective assumptions occurring
at the end of the reporting period, while holding all other assumptions constant. These sensitivities show the hypothetical impact
of a change in each of the listed assumptions in isolation. While each of these sensitivities holds all other assumptions constant,
in practice such assumptions rarely change in isolation and the asset value changes may offset the impact to some extent. For
presenting the sensitivities, the present value of the Defined Benefit Obligation has been calculated using the projected unit
credit method at the end of the reporting period, which is the same as that applied in calculating the Defined Benefit
Obligation presented above. There was no change in the methods and assumptions used in the preparation of the Sensitivity
Analysis from previous year.
` in Lakhs
DBO as at 31st March, 2019 DBO as at 31st March, 2018
1. Discount Rate + 100 basis points 4090.96 3644.62

2. Discount Rate - 100 basis points 4552.47 4069.91
3. Salary Increase Rate + 1% 4479.40 4038.63
4. Salary Increase Rate - 1% 4133.34 3665.56
Maturity Analysis of the Benefit Payments
1. Year 1 602.16 514.28
2. Year 2 502.70 544.68
3. Year 3 473.41 472.90
4. Year 4 555.70 440.74
5. Year 5 417.38 503.01
6. Next 5 Years 1727.00 1588.95

73
33. With implementation of Goods & Service tax (GST) with effect from 1st July, 2017, the Company's main product is now subjected
to GST and Compensation Cess in addition to Central Excise (currently only National Calamity Contingent Fund). Due to such
restructuring of indirect taxes, the figures for "Revenue from operations" (net of GST and Compensation Cess collected on behalf
of government) and "Excise duty" for the year ended 31st March, 2019 are not comparable with the previous period.
34. COMPARATIVE FIGURES

The Comparative figures for the previous year have been re-arranged to conform with the current year presentation of the
accounts.
As per our report of even date. On behalf of the Board,

DIN : 03588071
SRIRAM MAHALINGAM
110
` in Lakhs
Operating Results 2010-2019
2010 2011 2012 2013 2014 2015 2016 2017# 2018# 2019#
REVENUE FROM OPERATION (GROSS) 112542 139964 160276 162607 163121 172308 206299 226130 135864 118411
EXCISE DUTY 65325 81811 91833 95739 84203 88692 117984 133891 41106 8510
OPERATING PROFIT 7018 14257 20977 18031 21811 24257 23740 24774 29399 35312
OTHER INCOME (NET) 3323 1711 2572 2625 3244 1809 2020 2008 2462 3890
DEPRECIATION & AMORTISATION 1787 2442 2483 2250 2657 3190 3102 3692 3916 4135
PROFIT BEFORE TAX &
EXTRAORDINARY ITEM 8554 13526 21066 18406 22398 22876 22658 23090 27945 35067
PROFIT AFTER TAX &
EXTRAORDINARY ITEM 6205 9501 14251 12625 15015 15221 15311 15153 18189 22684
OTHER COMPHRENSIVE -- -- -- -- -- -- -- (129) 62 (63)
INCOME AFTER TAX
TOTAL COMPHRENSIVE INCOME 6205 9501 14251 12625 15015 15221 15311 15024 18251 22621
Equity, Liabilities and Assets 2010-2019

2010 2011 2012 2013 2014 2015 2016 2017# 2018# 2019#
SHARE CAPITAL 1544 1544 1544 1544 1544 1544 1544 1544 1544 1544
OTHER EQUITY 23194 24900 27475 28867 31280 33124 35499 52353 56665 64859
SHAREHOLDER'S FUNDS 24738 26444 29019 30411 32824 34668 37043 53897 58209 66403
PROPERTY, PLANT AND EQUIPMENT,
INTANGIBLE ASSETS AND CAPITAL
WORK-IN-PROGRESS (NET) 13940 15249 16353 17523 20913 19778 21468 22083 22930 21371
OTHER ASSETS (NET OF LIABILITIES*) 10798 11195 12666 12888 11911 14890 15575 31814 35279 45032
NET ASSETS EMPLOYED 24738 26444 29019 30411 32824 34668 37043 53897 58209 66403
Performance 2010-2019
2010 2011 2012 2013 2014 2015 2016 2017# 2018# 2019#
EARNINGS PER SHARE (Rs.) 40.2 61.5 92.3 81.8 97.2 98.6 99.2 98.1 117.8 146.9
DIVIDEND^ 5402 8076 11666 11291 12646 13010 13010 13939 14427 17685
DIVIDEND PER SHARE (Rs.) 30.0 45.0 65.0 62.5 70.0 70.0 70.0 75.0 77.5 95.0
RETURN ON CAPITAL 25.1 35.9 49.1 41.5 45.7 43.9 41.3 27.9 31.4 34.1
EMPLOYED (%)
# As per Indian Accounting Standards (Ind AS); Previous GAAP for earlier years
* Borrowings - Nil
^ Includes Income Tax on Dividend.

73
ANNEXURE TO THE DIRECTORS' REPORT
Information under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 and forming part of the Directors' Report for the year ended 31st March, 2019
Name Age Qualifications Designation & Date of Exp. Remuneration Last

Nature of Duties Commencement in received / employment
of Employment years receivable
`
Names of top ten employees in terms of remuneration drawn and name of every employee who was employed throughout the Financial Year
and in receipt of remuneration which, in the aggregate, was not less than ` 102 lakhs per annum
1 Devraj Lahiri 46 B.Com., MBA Managing Director 12-3-2001 21 25,613,663 NFO Singapore
2 Gopi A 56 B.E., MBA Vice President - Technical 1-8-1994 32 9,022,252 BMF Beltings Limited
3 Lakshmi Narasaiah T 53 M.Sc. Ag., Ph.D. Vice President - Leaf 1-2-1994 25 9,017,275 ---
4 Rohit Sahni 57 B.Sc. Vice President - Marketing 1-3-2006 30 8,838,871 Dabur India Limited
5 Kalyan Basu 49 B.Com., MBA Vice President - Marketing 15-9-2006 25 8,518,865 Coca Cola India
6 Anish Gupta 47 B.Com., FCA Chief Financial Officer 7-8-2000 22 8,221,969 ITW Signode
7 Sriram S 52 B.E., PGCHRM (XLRI) Vice President - H R 2-3-1993 30 8,214,544 Shriram Refrigeration
8 Phani K Mangipudi 39 B.Com., CS, LLB Company Secretary & 7-2-2017 17 5,644,655 Agro Tech Foods Limited
Head-Legal & Secretarial
9 Biju Joseph P 52 B.Tech General Manager 15-3-1993 30 5,490,211 Siemens Limited
Production (PMD)
10 Magesh L 49 MBA General Manager 1-6-2006 29 5,260,099 Alembic Limited -
OTC Division
Employed for part of the financial year, was in receipt of remuneration which, in the aggregate, was not less than Eight lakhs Fifty Thousand rupees
per month
NOTES :
1. All appointments are / were contractual.
2. No Director is related to any other Director or employee of the Company listed above.
3. No employee was in receipt of remuneration for the year which, in the aggregate, or as the case may be, at a rate which, in the aggregate, is
in excess of that drawn by the managing director or whole-time director or manager and holds by himself or along with his spouse and
dependent children, not less than two percent of the equity shares of the Company.
4. Remuneration received / receivable includes salary, performance bonus, allowances, other benefits / applicable perquisites, and Company's
contribution to Provident Fund & other Funds and where it is not possible to ascertain the actual expenditure incurred by the Company in
providing a perquisite, the monetary value of such perquisite is calculated in accordance with the Income Tax Act, 1961, and the Rules made
thereunder.
On behalf of the Board,
Dated this 3rd day of May, 2019 Pradeep V. Bhide

Hyderabad DIN No : 03304262
112
PROXY FORM
[Pursuant to Section 105(6) of the Companies Act, 2013 and
Rule 19(3) of the Companies (Management and Administration) Rules, 2014] Form No. MGT-11

CIN: L29150TG1930PLC000576
Registered Office: Azamabad, Hyderabad – 500 020
Phone: +91 40 27688000| Fax: +91 40 27615336
Email: investors@vstind.com | Website: www.vsthyd.com
Name of the Member(s)
Registered Address
Email ID
Folio No./Client ID
DP ID No. of Shares
I/We, being a Member/Members of above named Company, hereby appoint :
1. Name
Address
Signature
Email ID
or failing him/her
✄
2. Name
Address
Signature
Email ID
Tear here
or failing him/her
3. Name
Address
Signature
✄
Email ID
as my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the 88th Annual General Meeting of the Company, to be held on
Wednesday, 28th August, 2019 at 9.30 a.m. at Hotel Taj Krishna, Road No.1, Banjara Hills, Hyderabad – 500 034 and at any adjournment thereof in
respect of such Resolutions as are indicated below :
Resolution No. Resolutions For* Against*
Ordinary Business
1. Consideration and adoption of Audited Financial Statements, Report of the Board of Directors and Auditors thereon
2. Declaration of dividend on equity shares
3. Mr. S. Thirumalai (DIN:00011899), who retires by rotation and being eligible, offers himself for re-appointment
Special Business
4. Appointment of Mr. Naresh Kumar Sethi (DIN: 08296486) as a Non-Executive Director
5. Appointment of Ms. Rama Bijapurkar (DIN: 00001835) as an Independent Director
6. Appointment of Mr. Sudip Bandyopadhyay (DIN: 00007382) as an Independent Director
7. Appointment of Mr. Rajiv Gulati (DIN: 06820663) as an Independent Director
8. Variation in the terms of remuneration paid/payable to Mr. Devraj Lahiri, Managing Director (DIN: 03588071)
9. Remuneration payable to Mr. Naresh Kumar Sethi, Non-Executive Director (DIN : 08296486)
10. Remuneration payable to Mr. S. Thirumalai, Non-Executive Director (DIN : 00011899)
Affix a
Signed this day of 2019 Signature of Member 15 paise
Revenue
Signature of Proxy Stamp
Note :
1. This form of proxy in order to be effective should be duly completed and deposited at the Registered Office of the Company, not less than 48 hours
before the commencement of the Meeting.
2. A person can act as a proxy on behalf of Members, not exceeding fifty, and holding in the aggregate not more than 10% of the total share capital of
the Company carrying voting rights. A Members holding more than 10% of the total share capital of the Company carrying voting rights may appoint
a single person as proxy and such person shall not act as a proxy for any other person or shareholder.
* It is optional to put an ‘X’ in the appropriate column against the resolution indicated in the box. If you leave the ‘For’ or ‘Against’ column blank against
any or all the resolutions, your Proxy will be entitled to vote in the manner as he/she deems appropriate.

73
114
Notes

73
Notes
116

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VST Industries Limited

The General Manager The Manager

STOCK CODE : 509966 STOCK SYMBOL: VSTIND

Sub: Annual Report 2019

Please take the same on record.

Report of the Board of Directors &

Annexure to the Directors’ Report .. .. .. .. .. .. .. .. .. 27

Business Responsibility Report (BRR) .. .. .. .. .. .. .. .. .. 69

Independent Auditors’ Report .. .. .. .. .. .. .. .. .. 74

Statement of Profit and Loss .. .. .. .. .. .. .. .. .. 83

Cash Flow Statement .. .. .. .. .. .. .. .. .. 85

Notes to Financial Statement .. .. .. .. .. .. .. .. .. 86

Operating Results .. .. .. .. .. .. .. .. .. 111

Proxy Form .. .. .. .. .. .. .. .. . 113

Directors NARESH KUMAR SETHI * Chairman

Chief Financial Officer ANISH GUPTA

Company Secretary PHANI K. MANGIPUDI

Auditors B S R & ASSOCIATES LLP

Registered Office 1-7-1063/1065, Azamabad

Annual Report 2018-19 73

Annual Report 2018-19 73

Statement pursuant to Section 102(1) of Companies Act, 2013

Annual Report 2018-19 73

Annual Report 2018-19 73

Annual Report 2018-19 11

DETAILS OF DIRECTORS SEEKING APPOINTMENT/RE-APPOINTMENT AT THE FORTHCOMING ANNUAL GENERAL MEETING

Annual Report 2018-19 13

Financial Summary (` Lakhs) MANAGEMENT DISCUSSION &

Annual Report 2018-19 15

Annual Report 2018-19 17

Annual Report 2018-19 19

Annual Report 2018-19 21

Annual Report 2018-19 23

Annual Report 2018-19 25

There has been no qualification, CONSERVATION OF ENERGY, ACKNOWLEDGEMENTS

Name of the Director Category No. of outside No. of memberships/chair-

Annual Report 2018-19 27

Annual Report 2018-19 29

Annual Report 2018-19 31

The Company Secretary acts as Secretary to the Committee.

Remuneration to Non-Executive Directors

Annual Report 2018-19 33

@ Waived entitlement to sitting fees.

5. STAKEHOLDERS’ RELATIONSHIP COMMITTEE

Mr. Pradeep V. Bhide, Non-Executive Director is the permanent invitee.

Nature of complaints / queries Received Attended Pending

Annual Report 2018-19 35

- To monitor the progress of the projects/activities from time to time;

The Company Secretary acts as the Secretary to the Committee.

Year Venue Date Time

10. MEANS OF COMMUNICATION

Annual Report 2018-19 37

April, 2018 3288.00 2828.00 3198.10 2906.30

VST INDUSTRIES LIMITED

Performance in comparison with Nifty 50

VST INDUSTRIES LIMITED

Annual Report 2018-19 39

Distribution of shareholding as on 31st March, 2019

Dematerialisation of shares and liquidity