KUSHAL TRADELINK LIMITED ANNUAL REPORT 2013-2014CS. Khushboo Surana (Company Secretary and Compliance Officer) CA. Vimal Shah (Chief Financial Officer) Statutory Auditors: Registrar:

KUSHAL TRADELINK LIMITED

ANNUAL REPORT2013-2014

Environmentally yoursEnvironmentally yours

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Contents

02Corporate Information

03Notice

10

From the Chairman’s Desk

11Major Products Dealt

with.

12

Financial Highlights

13Director’s Report

18Corporate Governance

Report

31Management Discussion and Analysis Report

Financials

34Auditors’ Report

39Balance Sheet ( Stand alone)

40

Profit & Loss Account ( Stand alone)

41Cash Flow Statement

( Stand alone)

43 Notes to Accounts ( Stand alone)

62 Consolidated Results


Corporate Information

Board of Directors: Mr. Sandeep Agrawal (DIN 00239648) : Chairperson and Managing Director Mr. Mahendra Agrawal (DIN 00225551) : Whole Time Director CA. Arpan Shah (DIN 06458101) : Professional Non Executive Director CS. Sagar Sharma (DIN 06473984) : Independent Non Executive Director Ms. Kavita Jain (DIN 05295442) : Independent Non Executive Director Mr. Dharmendra Bhuchhada (DIN06468613) : Independent Non Executive Director Key Managerial Personnel: CS. Khushboo Surana (Company Secretary and Compliance Officer) CA. Vimal Shah (Chief Financial Officer) Statutory Auditors: Registrar: M/s. P. Doshi & Associates Bigshare Services Private Limited Chartered Accountants E‐2/3 Ansa Industrial Estate, 306, Rajkamal Plaza‐A, Saki Vihar Road, Sakinaka Opp. Old High Court Andheri (E), Mumbai – 400072 Ahmedabad‐380014 Tel No.: +91 – 22 – 4043 0200 Fax No.: +91 – 22 – 2847 5207 Web: www.bigshareonline.com Bankers: Listing: Standard Chartered Bank, Ahmedabad BSE Limited‐SME Platform ICICI Bank Limited, Ahmedabad Phiroze Jeejeebhoy Towers Axis Bank Limited, Ahmedabad Dalal Street Mumbai‐ 400001 Registered Office: Contact Details for Investors: Plot No. 43, B/S Navneet Prakashan Press, Compliance Officer B/H Govt 'G' Colony, Plot No. 43, B/S Navneet Prakashan Press, Sukhramnagar, Gomtipur, B/H Govt 'G' Colony, Ahmedabad – 380023 Sukhramnagar, Gomtipur, Tel No:+91‐79‐22772991 Ahmedabad – 380023 Fax No: +91‐79‐22782670 Tel No: +91‐79‐22772991 Web: www.kushaltradelink.com Mail id: [email protected]

Important Communication to Members The Ministry of Corporate Affairs has taken a “Green Initiative in the Corporate Governance” by allowing paperless compliances by the companies and has issued circulars stating that service of notice / documents including Annual Report can be sent by e‐mail to its members. To support this green initiative of the Government in full measure, members who have not registered their e‐mail addresses, so far, are requested to register their e‐mail addresses, in respects of electronic holding with the Depository through their concerned Depository Participants.


NOTICE TO MEMBERS

Notice is hereby given that 14th Annual General Meeting of the Members of Kushal Tradelink Limited will be held on 22nd August 2014, Friday at 11.00 A.M at the Registered Office of the company i.e. “Kushal House”, Plot No. 43, B/s Navneet Prakashan Press, B/h. Govt 'G' Colony, Sukhramnagar, Gomtipur, Ahmedabad – 380023 Gujarat, India, to transact the following business :

Ordinary Business:

1. To receive, consider and adopt the Audited Balance Sheet as on 31st March 2014 and the Profit & Loss Account for the period ended on that date together with the Cash flow, Director Report and Auditors Report thereon.

2. To appoint a Director in place of CA. Arpan Shah (DIN 06458101), who retires by rotation and being eligible offers himself for reappointment.

3. To appoint a Director in place of Mr. Dharmendra Bhuchhada (DIN 06468613), who retires by rotation and being eligible offers himself for reappointment.

Special Business :

4. To appoint Statutory Auditor of the Company in place of retiring one

To consider and if thought fit, to pass, with or without modification(s), the following Resolution as ordinary resolution

To appoint M/s. K.G Vakharia & Co, Chartered Accountants, Ahmedabad (FRN: 117022W), in place of the retiring auditor, M/s P. Doshi & Associates, Chartered Accountants Ahmedabad (FRN:102740W), to hold the office of Auditors from the conclusion of this Meeting to the conclusion of the next Annual General Meeting of the Company on such remuneration as may be recommended by the Audit committee.

5. To authorize Board of Directors of the Company to Borrow Money

To consider and if thought fit, to pass, with or without modification(s), the following Resolution as special resolution

“RESOLVED THAT pursuant to the provisions of Section 180 (1)(c) and other applicable provisions, if any, of the Companies Act 2013, and rules made thereon, the consent of the Company be and hereby accorded to the Board of Directors of the Company ( hereinafter called “the Board” which term shall be deemed to include any committee thereof, which the Board may have constituted or hereinafter constitute to exercise its powers including the powers conferred by this resolution and with power to delegate such authority to any person or persons) for borrowing from time to time as they may think fit, any sum or sums of money not exceeding Rs. 150 Crore (Rupees One Hundred and Fifty Crore Only) [including the money already borrowed by the company) in Indian Rupees or equivalent thereof in any foreign currency(ies) on such terms and conditions as the Board may deem fit, whether the same may be secured or unsecured and if secured, whether domestic or international, whether by way of mortgage, charge or hypothecation, pledge or otherwise in any way whatsoever, on, over or in any respect of all , or any of the company’s assets and effects or properties including stock in trade, notwithstanding that the money to be borrowed together with the money already borrowed by the Company (apart from the temporary loans obtained from the Company’s Bankers in the ordinary course of business) and remaining un‐discharged at any given time, irrespective of the aggregate of the paid up capital of the Company and its free reserves.”


“RESOLVED FURTHER that the Directors of the Company be and are hereby authorised to do all such acts and things as may be necessary for giving effect to the foregoing Resolution, and to settle all Questions / Matters relating to the foregoing resolution.”

6. For Mortgaging/Charging Immovable and Movable Properties of the Company

To consider and if thought fit, to pass, with or without modification(s), the following Resolution as Special Resolution

“RESOLVED that pursuant to the provisions of Section 180 (1) (a) and other applicable provisions, if any of the Companies Act, 2013, Memorandum and Article of Association of the company, the consent of the Company be and is hereby accorded to the Directors of the Company ( hereinafter called “the Board” which term shall be deemed to include any committee thereof, which the Board may have constituted or hereinafter constitute to exercise its powers including the powers conferred by this resolution and with power to delegate such authority to any person or persons) for mortgaging and / or charging all or any of the present and / or future one or more movable and / or immovable properties and assets and the whole or substantially the whole of the undertaking of the Company, in such form and manner, as the Directors may determine for the purpose of securing the borrowings of the Company upto a sum of Rs. 150 Crore (Rupees One Hundred and Fifty Crore Only) from Financial Institutions / Banks or any other persons (hereinafter referred to as “the Lenders”) in terms of loan Agreements entered into / to be entered into by the Company with the lenders in respect of the said borrowings.”

“RESOLVED FURTHER that the Directors of the Company be and are hereby authorised to do all such acts and things as may be necessary for giving effect to the foregoing Resolution, and to settle all Questions / Matters relating to the foregoing resolution.”

7. Approval of business transaction with Ashapura paper mills private limited


“RESOLVED THAT pursuant to Section 188 and all other applicable provisions, if any, of the Companies Act, 2013 and the Companies (Meetings of Board and its Powers) Rules, 2014 made thereon and as per revised clause 49 of SEBI Circular CIR/CFD/POLICY CELL/2/2014 dated April 17, 2014 and such other approvals, consents, permissions or sanctions of any other appropriate authorities or entities, as the case may be, consent of the Company be and is hereby accorded to the Board of Directors of the Company (hereinafter referred to as “the Board” which term shall include a Committee of Directors constituted or to be constituted for this purpose including any person or persons who may be authorised by the Board), to enter into business transaction with Ashapura Paper Mills Private Limited for purchase of paper material for 3 years as per the terms and condition mentioned in arrangement letter as per annexure B of the Notice in which relatives of Mr. Sandeep Agrawal and Mr. Mahendra Agrawal are directors and shareholders in the company”


8. Approval of business transaction with Riddhi Siddhi Recyclers private limited


“RESOLVED THAT pursuant to Section 188 and all other applicable provisions, if any, of the Companies Act, 2013 and the Companies (Meetings of Board and its Powers) Rules, 2014 made thereon and as per revised clause 49 of SEBI Circular CIR/CFD/POLICY CELL/2/2014 dated April 17, 2014 and such other approvals, consents, permissions or sanctions of any other appropriate authorities or entities, as the case may be, consent of the Company be and is hereby accorded to the Board of Directors of the Company (hereinafter referred to as “the Board” which term shall include a Committee of Directors constituted or to be constituted for this purpose including any person or persons who may be authorised by the Board), to enter into business transaction with Riddhi Siddhi Recycler Private Limited for purchase and sale of paper material for 3 years as per the terms and condition mentioned in arrangement letter as per annexure C of the Notice in which relative of Mr. Sandeep Agrawal and Mr. Mahendra Agrawal is director and shareholders in the company”

Date : July 18, 2014 By the Order of Board Place : Ahmedabad FOR KUSHAL TRADELINK LIMITED SD/‐ Khushboo Surana (Company Secretary and Compliance Officer) Notes:

• A member entitled to attend and vote is entitled to appoint a proxy to attend and vote instead of himself and a proxy need not be a member.

• Proxy form, in order to be effective, must be received at the Registered Office of the Company, not less than 48 hours before the commencement of the Annual General Meeting i.e. by 11:00 AM on 20st August ,2014.

• Corporate members intended to send their authorized representatives to attend the meeting are requested to send the Company a certified copy of Board resolution authorizing their representative to attend and vote on their behalf at the Meeting.

• Members/Proxy holders are requested to bring their copy of Annual Report and Attendance slip sent herewith, duly filled‐in for attending the Annual General Meeting.

• Members who wish to obtain information on the Company may send their queries atleast 10 days before the Annual General Meeting to the Company Secretary at the Registered Office of the Company.

• The Register of Members and the Share Transfer Books of the Company will remain closed from Monday, 18th August 2014 to Saturday 23rd August 2014 (both days inclusive).

• The Shareholders are requested to notify their change of address immediately to the Registrars & Transfer Agent Bigshare Services Pvt. Ltd. The Company or its registrar will not act on any request received directly from the shareholder holding shares in electronic form for any change of bank particulars or bank mandate. Such changes are to be advised only to the Depository Participant by the Shareholders.

• Members are requested to intimate their Email IDs for correspondence and quicker response to their queries.


Annexure to Notice

Explanatory Statement Pursuant To Section 102 of Companies Act 2013 (Section 173 (2) Of Companies Act 1956)

For Item no 4

The existing auditors of the Company M/s. P. Doshi & Associates, Chartered Accountants, Ahmedabad becomes disqualified for re‐appointment upon implementation of recently notified section 141 of the Companies Act 2013 and Companies (Audit and Auditors) Rules, 2014. In view of the same, after considering several options, the Audit Committee of the Board of the Company, in its meeting held on 1st May 2014 recommended the appointment of M/s. K.G Vakharia & Co, Chartered Accountants, Ahmedabad (FRN: 117022W) to hold the office of the Auditors of the Company till the conclusion of Next Annual General Meeting. Your Board recommend the appointment of the Auditors.

Further the Board wish to put it on record that the company has received a letter from the proposed Auditors confirming their eligibility for appointment and a declaration confirming the fact that they are not disqualified under any of the clause/ sub clause of section 141 of the Companies Act 2013.

None of the Directors of the Company is concerned or interested in the proposed resolution

For Item no 5

Pursuant to Section 180 (1) (c) of the Companies Act, 2013, the Board of Directors of a Public Limited Company shall not, except with the consent of the members in General Meeting, borrow money (apart from temporary loans obtained in the ordinary course of business) exceeding the paid up Capital of the Company and its free reserves for the time being. As the Company is listed Public Limited Company, your Directors propose to seek approval of members to authorize the Board to borrow any sum or sums of money not exceeding Rs. 150 Crore (Rupees One Hundred and Fifty Crore Only) [including the money already borrowed by the company] in Indian Rupees or equivalent thereof in any foreign currency (ies) on such terms and conditions as the Board may deem fit.

None of the Directors of the Company is concerned or interested in the proposed resolution.

For Item no 6

As the Company require to pass resolution authorizing Board to borrow loans upto maximum of Rs. 150 Crores. In order to borrow loans from Banks, institutions, etc., the Board needs authorization to mortgage/hypothecate the assets of the company as security/collateral security. In order to mortgage or hypothecate the assets of the company the consent of the shareholders in the General Body Meeting is required under section 180(1)(a) of Companies Act, 2013 authorizing the Board of Directors with necessary powers.

None of the Directors of the company are interested or concerned in any way in the resolution.

For Item no 7

Kushal Tradelink Limited is dealing in trading of various kind of papers viz. Kraft Paper, Duplex Board, Paper Waste (Imported/Domestic), News Print Tear off, Cromo Art Paper, Reel Core etc., since year 2000. Ashapura Paper Mills Pvt. Ltd is located in the state of Gujarat and engaged in the business of manufacturing of Kraft papers which is mostly used in packaging units. KTL purchase finished goods as Kraft Papers from APMPL and


supply the same to packing units on such terms and condition as mentioned in Annex B of Notice in such manner as it deals with other mills on arms length price basis as it’s not related with KTL

Mr. Sandeep Agrawal (CMD) and Mr. Mahendra Agrawal (WTD) of the company are interested party in the resolution.

For Item No 8

Kushal Tradelink Limited is dealing in trading of various kinds of papers viz. Kraft Paper, Duplex Board, Paper Waste, News Print Tear off, Cromo Art Paper, Reel Core etc., since year 2000. The company also deals in Waste Paper which is being used by paper mills as their raw material for making fresh paper by recycling the paper waste. We procure domestic waste from various whole sellers and in turn supply it to Paper mills for recycling purposes. Although there is no one to one nexus between the waste paper supplied and finished goods procured, but quite often we supply the waste to the same Paper mill from whom we procure finished Kraft Paper. KTL purchase finished goods as Kraft Papers from RSRPL and supply the same to packing units on such terms and condition as mentioned in Annex C of Notice in such manner as it deals with other mills on arms length price basis as it’s not related with KTL.

Mr. Sandeep Agrawal (CMD) and Mr. Mahendra Agrawal ( WTD) of the company are interested party in the resolution.


ANNEXURE A TO THE NOTICE

Details of Directors seeking Re‐appointment

NAME

CA. ARPAN SHAH

MR. DHARMENDRA BHUCHHADA

DIN

06458101 06468613

Date of Birth

22/08/1981 01/06/1983

Appointed on

15TH January 2013 15TH January 2013

Qualifications

Chartered Accountant, Masters in Commerce

LL.B

Brief Profile

CA. Arpan Shah holds a Bachelors degree in Commerce from the Gujarat University, pursuant to which he completed his M.Com from the Gujarat University. He is also a Fellow Member of The Institute of Chartered Accountants of India (ICAI). His professional experience includes conducting various types of Audits like Systems Audits, Revenue Leakage Audits, Statutory Audits of PSU banks, etc., providing consultancy services in the areas of Income Tax, VAT, Company Law matters, Business restructuring, etc. He has also been involved in preparation of Project Appraisal Reports for new as well as existing projects and arranging bank finance through various modes.

Mr. Dharmendra Bhuchhada completed his B.Sc from the Gujarat University, pursuant to which he completed his LLB. He has been serving as an Advocate for the last ten years and has an experience of more than fifteen years as a Legal Consultant in Labour Laws. His core competencies include preparing suits, written statements, and objections, filing vakalat on behalf of companies, arguing before various quasi judicial authorities, drafting legal notices, rejoinders, complaints, plaints, compromise petitions and other cases filed against and on behalf of companies.

Directorship held in other Public Limited Company

Nil Nil

Membership/ Chairmanship of Committees

Member in three committees Member in two committees

No of Shares held in the Company

Nil Nil

None of the Directors of the Company is concerned or interested in the proposed resolution


ANNEXURE B TO THE NOTICE

Terms and condition for Business transaction with Ashapura Paper Mills Pvt Ltd

• The Company (KTL) purchase finished goods (Kraft papers) from Ashapura paper Mills pvt ltd as per market demand All the transaction for purchase of materials will be on arm’s length price basis.

• Quantity for purchase may differ maximum upto +/‐ 5% as per the market requirement. • Price of materials will vary between the range provided as per technical Specification of the material. • Credit period for sale of product can be upto 0‐180 days. • Details for purchase of Finished Goods (Kraft Papers) with price:

Time period Quantity Rate 2014‐2015 Maximum upto 45000 Tones Rs. 16/‐ to Rs. 30/‐ per K.G. 2015‐2016 Maximum upto 55000 Tones Rs. 16/‐ to Rs. 32/‐ per K.G. 2016‐2017 Maximum upto 65000 Tones Rs. 16/‐ to Rs. 35/‐ per K.G.

ANNEXURE C TO THE NOTICE

Terms and condition for Business transaction with Riddhi Siddhi Recyclers Pvt Ltd

• The Company (KTL) sale waste papers to RIDDHI SIDDHI RECYCLERS PRIVATE LIMITED as raw material. • The Company (KTL) purchase finished goods (Kraft papers) from RIDDHI SIDDHI RECYCLERS PRIVATE LIMITED

as per market demand. • All the transaction of purchase and sale of materials will be on arm’s length price basis. • Quantity for purchase and sale of materials may differ maximum upto +/‐ 5% as per the market requirement. • Price for purchase and sale of materials will vary between the ranges provided as per technical Specification

of the material and as per prevailing market prices but may differ maximum upto +/‐ 5%. • Credit period for sale of product can be upto 0‐180 days. • Details for Sale of Waste Papers with price:


Details for purchase of Finished Goods (Kraft Papers) with price:



From the Chairman’s Desk

Dear Shareholders

It gives me joy in sharing my views for the first time with such a large base of share holders. On one side I personally feel strengthened as the strength of all our members has now become my strength and on the other side I get a feeling of being laden with more responsibilities and accountability. However I am confident enough that with the support of all the stake holders our company will definitely perform extra ordinarily well. I would like to take this opportunity to thank each one of you for being a part of KUSHAL FAMILY and being instrumental in successfully completing India’s largest SME IPO of your company. Paper Industry across the globe is performing moderately well and in the time to come it is expected to depict steady growth. There is a shift in demand and consumption of paper from western countries to asian countries. Per Capita consumption in India is low as compared to other countries however the same is expected to take a steep upward trend with an increase in demand in packaging. In view of the same we have a very positive outlook for our business.

We play a role of a very important intermediary between the paper mills and the industry using paper viz. printing and packaging. We are also expanding our base amongst paper manufacturers by supplying them waste paper for recycling. We work on a very unique business model providing structured deals to both the sides of the supply chain. This helps us get a good grip over the market as we understand the dynamics of both paper manufacturers and paper consumers. We are in the process of continuously evolving our business model to suit the growing market by providing our customers comfortable terms of credit, logistics and after sales support. In view of all of this I can proudly say that your company is considered amongst the top players in the market with a very unique business model, a large customer‐supplier base and a vast product range.

I believe that success is not a milestone, it is a journey. I see a long path ahead for all of us to reach our ambitions. I feel that there is still a huge scope of opportunities for us to explore. As a market leader in our segment we continuously work on developing our business strategy with adequate safety, product diversification, geographical expansion, backward and forward integration to meet the need of the ever changing time.

Looking forward we shall focus in capturing more and more market share by providing the goods at lowest possible cost to our customers while maintaining the highest standards of quality. We also feel proud and privileged to be a necessary intermediary in adopting environment safety measures in view of the fact that we facilitate recycling waste paper and thereby saving thousands of trees every year.

Environmentally Yours,

Sandeep Agrawal Chairman & Managing Director


Major Products dealt with..

Kraft Papers

Duplex Board

Coated Papers

Waste

News Prints and

its Tear off


Financial Highlights


Directors’ Report

To The Members Kushal Tradelink Limited Your directors have pleasure in presenting the Annual Report together with the audited statements for the financial year ended on March 31, 2014. FINANCIAL HIGHLIGHTS

(INR in Lacs)

PERFORMANCE REVIEW: Your company could beat the peers though its encouraging performance during the year under review. The group recorded the turnover of Rs. 302 Crores giving 22.96 % rise YoY. The PAT of your company also went upward by 15 %. However the parent company had to absorb the loss of its Singapore based WOS to the tune of Rs.0.21 Crores and hence the group PAT was recorded at Rs. 4.48 Crores. Singapore based WOS reported a loss in view of fact that it operated only for one month during the fiscal 2013‐2014. The EPS was recorded at 2.30 (stand alone) and 2.20 (consolidated) ,which was lower compared to that of last year. The same is lowered in view of the 7928000 Eq. Shares being added to the pool throw an IPO during the year under review. INITIAL PUBLIC OFFERING During the year under review, your company came up with an IPO of 79, 28000 Equity shares of Rs.10/‐ each at a premium of Rs. 25/‐ per share with Total Issue size of Rs. 27.75 Crores which was subscribe 1.2 times. Your Board feel proud to note the fact that this was the largest IPO on SME segment of Indian Capital Market. Your Board is really thankful for the trust posed in the Company. Subsequently the shares of the company have been listed on SME Platform of BSE since September 4, 2013. Your Company has paid annual listing fees for financial 2014‐2015 to BSE India Limited along Custodian fees to NSDL and CDSL.

PARTICULARS Consolidated Accounts Standalone Accounts 201314 2012‐13 201314 2012‐13

Revenue from Operations 30251.85 24602.86 30050.28 24602.86Other Income 31.88 (3.21) 31.88 (3.21)TOTAL REVENUE 30283.73 24599.65 30082.16 24599.65Total Expenditure 29614.69 23992.21 29392.07 23992.21Profit Before Tax 669.04 607.44 690.09 607.44Less: Provision for Current Tax (Incl . Earlier Year ) 223.35 198.12 223.35 198.12Less: Deferred tax liability (3.08) 0.76 (3.08) 0.76Profit after Tax 448.77 408.56 469.82 408.57Earnings Per Share 2.20 2.59 2.30 2.59


TRANSFER TO RESERVES: The Company has not transferred any portion of profits to General Reserve Account for the financial year. DIVIDEND: Your Directors regret their inability to declare any dividend. However with a view to ploughing back of profits in the business to meet the long term working capital requirement. PUBLIC DEPOSITS: The company has not accepted any Public deposits from the public during the year. FUTURE PLANS: The company look forward to diversify its product base and emphasizing focus on paper waste being the major raw material required by paper manufacturers. The company plans to aggressively explore the global market for waste paper, the reason being superior quality of fiber contents in it. Your company is also exploring to open up overseas branches / foreign subsidiaries/ JVs to expand its presence in global market and thereby taking advantages of local presence in respective countries. Also the dynamics of trading in various other commodities like steel, chemicals relating to pharmaceutical , food products, petro chemicals etc. through overseas arms of the company are to be expedited in the interest of the overall performance of the group. DIRECTORS During the period under review there was no change in the constitution of Board of Directors In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company, CA Arpan Shah, Non Executive Professional Director and Mr. Dharmendra Bhuchhada, Independent Director of the Company liable to retire by rotation in the forthcoming Annual General Meeting and being eligible, they offer themselves for their re‐appointment. None of the Directors of the Company are disqualified under section 274(1)(g) of the Companies Act, 1956 and Section 164 of Companies Act 2013. DIRECTORS' RESPONSIBILITY STATEMENT: Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Directors, based on the representation received from the operating management and duly taken on record by the board, confirm that: (1) Annual accounts have been prepared in consonance with the applicable accounting standards and that

there were no material departures. (2) The accounting policies selected have been applied consistently, judgment and estimates that are

reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the company as at 31st March, 2014 and of the profit of the company for the period ended on that date.

(3) Proper and sufficient care has been taken for maintenance of proper accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for detecting frauds and irregularities.

(4) The annual accounts have been prepared on a going concern basis.


AUDITORS: The existing auditors of the Company M/s. P. Doshi & Associates, Chartered Accountants, Ahmedabad becomes disqualified for re‐appointment upon implementation of recently notified section 141 of the Companies Act 2013 and Companies (Audit and Auditors) Rules, 2014. In view of the same, after considering several options, the Audit Committee of the Board of the Company, in its meeting held on 1st May 2014 recommended the appointment of M/s. K.G Vakharia & Co, Chartered Accountants, Ahmedabad (FRN: 117022W) to hold the office of the Auditors of the Company till the conclusion of Next Annual General Meeting. Your Board recommend the appointment of the Auditors. Further the Board wish to put it on record that the company has received a letter from the proposed Auditors confirming their eligibility for appointment and a declaration confirming the fact that they are not disqualified under any of the clause/ sub clause of section 141 of the Companies Act 2013. AUDITORS REPORT Notes to the accounts, as referred in the Auditor’s Report, are self‐explanatory and therefore do not call for any further comments and explanations. PARTICULARS OF EMPLOYEES: There was no employee drawing salaries exceeding the limit stipulated under Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particular of Employees) Rules, 1975. SUBSIDIARY COMPANIES With a view to expand its geographical base, your company got incorporated its first Wholly Owned Subsidiary in the name and style of “Kushal Impex Pte Ltd.” in Singapore in January 2014 with the main object of General Wholesale Trade (Including General Importers and Exporters) STATUTORY INFORMATION Information pursuant to Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 related to Conversation of Energy, Technology Absorption, Foreign Exchange Earnings and outgo for the financial year ended 31st March 2014 are given in Annexure ‐ I attached hereto and forming part of this report. CORPORATE GOVERNANCE Your Company is committed to maintain high standards of Corporate Governance. Your company continues to comply with the requirements prescribed in clause 52 of the listing agreement relating to corporate governance. A detailed report on corporate governance together with the statutory auditor’s certificate thereon is attached and forms part of the Annual Report


MANAGEMENT DISCUSSION AND ANALYSIS REPORT Highlights / Extracts of Management Discussion and Analysis Report relating to the various aspects of the activities of your company is attached as a part of compliance of clause 52 of the listing Agreement. INDUSTRIAL RELATION: Your directors are pleased to report the industrial relation remained healthy throughout the year with various class of employees. Further your Board is pleased to put on record that there were no instance of strikes and lock outs. ACKNOWLEDGEMENT: The Directors extend their sincere thanks to the Bankers, Customers, Suppliers, Employees, Regulatory Bodies and various other Stakeholders and all others who have been associated with the Company in a way or the other for their continued support and co‐operation and also for the trust reposed in the management of the company. PLACE: AHMEDABAD. BY ORDER OF BOARD OF DIRECTORS DATE: May 1, 2014 OF KUSHAL TRADELINK LIMITED

(Sandeep Agrawal)

Managing Director (DIN 00239648)


Annexure I of the Directors’ Report

Information as per Section 217 (1) (e) read with the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 and forming part of the Directors’ Report for the year ended on March 31, 2014. A. Conservation of Energy: The Company consumes minor power and hence no details are required to be disclosed. B. Technology Absorption: The company not being engaged in any manufacturing / service sector. There is no specific technology involved in the business model of the company C. Foreign Exchange Earning & Out Go:

(Amount in USD) Particular 201314 2012‐13 Total Foreign Exchange Outgo :

9496648 5502568

Total Foreign Exchange Earned :

Nil NIL

PLACE: AHMEDABAD. BY ORDER OF BOARD OF DIRECTORS DATE: May 1, 2014 OF KUSHAL TRADELINK LIMITED

(Sandeep Agrawal)

Managing Director (DIN 00239648)


Annexure II to Directors’ Report Corporate Governance Report for the Year 201314

In terms of Clause 52(VI) of the Listing Agreement with BSE Limited (BSE), the report containing the details of Corporate Governance systems and processes at Kushal Tradelink Limited is as under:

1) Company’s Philosophy on Corporate Governance:

The Company’s Corporate Governance is a set of practices to ensure transparency, accountability and fairness in all the affairs of the company as business transparency is the key to promoting shareholder trust in the company. The company is committed to achieve high standards of Corporate Governance.

The company has a well defined corporate governance structure to ensure that the business conduct is fair and ethical.

2) Board of Directors:

The company has an optimum combination of executive and non‐ executive directors with not less than fifty percent of the board comprising of non‐executive directors.

The Composition of board and category of directors is as follows:

Category Name of Director Promoter / Chairman and Managing Director Mr. Sandeep Agrawal Promoter/ Whole Time Director Mr. Mahendra Agrawal Non‐ Executive Professional Director CA Arpan ShahNon‐ Executive Independent Director CS Sagar Sharma

Mr. Dharmendra Bhuchhada Ms. Kavita Jain

As on March 31, 2014, the company has six directors, of which three (50%) are Non‐Executive Independent Directors. None of the Directors on the Board is a Member on more than 10 committees and Chairman of more than 5 committees.

The Composition of board is in conformity with the requirements of the Clause 52 of the listing agreement entered into with the exchange.

During the financial year under review, twelve meetings of the board of directors were held on the following dates:

Sr.no. Date of Board Meeting 1 April 1, 20132 April 6, 20133 May 31, 20134 July 2, 20135 July 15, 20136 August 5, 20137 August 29, 20138 October 25, 20139 December 24, 201310 January 6, 201411 January 24, 201412 February 21, 2014


Attendance of Directors at Board meetings, last Annual General Meeting (AGM) and number of other Directorships and Chairmanships / Memberships of Committees of each Director in various companies is as follows: Name Category Number of board

meetings Whether held last AGM held on August 27, 2013

Number of Directorship in other public companies as

on 31.03.2014*

Details of committee positions held in other public companies as on

31.03.2014*

Shareholding as on

31.03.2014

Held Attended Chairman Member Chairman Member Equity Shares of

face value of Rs. 10/‐ each

Mr. Sandeep Agrawal

Promoter/ Chairman and Managing Director

12 12 Yes ‐ ‐ ‐ ‐ 1352340

Mr. Mahendra Agrawal

Promoter/ Whole Time Director

12 12 Yes ‐ ‐ ‐ ‐ 2270160

CA Arpan Shah

Non‐ Executive Professional Director

12 11 Yes ‐ ‐ ‐ ‐ ‐

Mr. Dharmendra Bhuchhada

Non‐ Executive Independent Director

12 7 Yes ‐ ‐ ‐ ‐ ‐

CS Sagar Sharma

Non‐ Executive Independent Director

12 7 Yes ‐ ‐ ‐ ‐ ‐

Ms. Kavita Jain Non‐ Executive Independent Director

12 7 Yes ‐ ‐ ‐ ‐ ‐

* In accordance with clause 52, Memberships/Chairmanships of only Audit Committee and Shareholders’ / Investors’ Grievance Committee in Public limited companies have been considered. **Excludes private/foreign/non‐profit companies.


3). Audit Committee: The Audit Committee of Kushal Tradelink Limited consists of two Independent directors, one non‐executive director and one executive director. The Chairperson of the committee is Ms. Kavita Jain, who is an Independent Director. The terms of reference of the Audit Committee are in accordance with all the items listed in Clause 52(II)(D) and (E) of the Listing Agreement and Section 292 of the Companies Act, 1956. The terms of reference of the Audit Committee includes the following:

1. Reviewing with the management, half yearly and Annual financial statements before submission to the board for approval, with particular reference to:

a) Matters required to be included in the Director’s Responsibility Statement to included in the Board’s report in terms of clause (2AA) of section 217 of the Companies Act, 1956

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) Qualifications in the draft audit report (if any).

2. Approval of payment to statutory auditors for any other services rendered by the statutory auditors.

3. Recommending to the Board, the appointment, re‐appointment and, if required, the replacement or

removal of the Statutory Auditor along with internal Auditors and the fixation of audit fees.

4. 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.

5. Reviewing the adequacy of internal audit function, 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.

6. To discuss with internal auditors any significant findings and follow‐up thereon.

7. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board.

8. To discuss with external auditors before the audit commences, the nature and scope of audit. Also have post‐audit discussion to ascertain any area of concern.

9. Reviewing the company's financial and risk management policies.

10. To look into the reasons for substantial defaults in the payments to the depositors, debenture holders, shareholders (in case of non‐payment of declared dividends) and creditors.

11. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee. Explanation (i): The term "related party transactions" shall have the same meaning as contained in the Accounting Standard 18, Related Party Transactions, issued by The Institute of Chartered Accountants of India.


Explanation (ii): If the Issuer has set up an audit committee pursuant to provision of the Companies Act, the said audit committee shall have such additional functions / features as is contained in this clause. The Audit Committee enjoys the following powers: i. To investigate any activity within its terms of reference. ii. To seek information from any employee. iii. To obtain outside legal or other professional advice. iv. To secure attendance of outsiders with relevant expertise, if it considers necessary.

Composition and attendance at Meetings: During the financial year, four meetings of the Audit Committee were held on the following dates: Sr.no. Date of Meeting 1 July 15, 2013 2 October 25, 20133 December 24, 20134 February 21, 2014

The composition, names of members, chairperson, particulars of the meetings and attendance of the members during the year are as follows: Name of Director Category No. of meetings attended Ms. Kavita Jain Chairperson, Non‐Executive Independent

director 4

CS Sagar Sharma Member, Non‐Executive Independent director 3CA Arpan Shah Member, Non‐ Executive Professional Director 4Mr. Sandeep Agrawal Member, Promoter/ Chairman and Managing

Director 4

4). Remuneration Committee: The Remuneration Committee of Kushal Tradelink Limited constituted on January 23, 2013 and consists of three Independent directors and One Professional Director. All are non‐ executive directors. The Chairperson of the committee is CS Sagar Sharma, who is an Independent Director. The terms of reference of Remuneration committee includes the following:

a) To recommend to the Board, the remuneration packages of the Company’s Managing / Whole time / Executive Directors, including all elements of remuneration package (i.e. salary, benefits, bonuses, perquisites, commission, incentives, stock options, pension, retirement benefits, details of fixed component and performance linked incentives along with the performance criteria, service contracts, notice period, severance fees etc.);

b) To be authorized at its duly constituted meeting to determine on behalf of the Board of Directors and on behalf of the shareholders with agreed terms of reference, the Company’s policy on specific remuneration packages for Company’s Managing / Whole time / Executive Directors, including pension rights and any compensation payment; c) To implement, supervise and administer any share or stock option scheme of the Company; d) To attend to any other responsibility as may be entrusted by the Board within the terms of reference.


During the financial year 2013‐14, one meeting of the Remuneration committee was held on April 1, 2013.

The composition, names of members, chairperson, particulars of the meetings and attendance of the members during the year are as follows: Name of Director Category No. of meetings attended CS Sagar Sharma Chairman, Non‐Executive Independent

director

1

Ms. Kavita Jain Member, Non‐Executive Independent director

1

Mr. Dharmendra Bhuchhada Member, Non‐Executive Independent director

1

CA Arpan Shah Member, Non‐ Executive Professional Director

1

NonExecutive Director’s Remuneration

The Non‐Executive Directors are paid remuneration by way of sitting fees. The details of sitting fees paid to Non Executive and Independent Directors for the Financial Year 2012‐13 are as under:

(Rs. in Lacs) Name of Director Designation Sitting fees during 201314 CA Arpan Shah Non‐ Executive Professional Director

0.66

Ms. Kavita Jain Non‐Executive Independent director

0.42

CS Sagar Sharma Non‐Executive Independent director

0.42

Mr. Dharmendra Bhuchhada Non‐Executive Independent director

0.42

None of the Non‐Executive Directors hold any equity shares in the Company as on March 31, 2014.

Executive Director’s Remuneration

Details of remuneration paid to the Executive Directors during the financial year 2013‐14 (Rs. in Lacs)

Name of Director Designation Total remuneration paid during 201314

Mr. Sandeep Agrawal Chairman and Managing Director

13.98

Mr. Mahendra Agrawal Whole Time Director

13.70


5). Shareholder’/Investors’ Grievance Committee:

The terms of reference of Shareholders’/ Investors’ Grievances Committee includes the following: a) Redressing of shareholders and investor complaints such as non‐receipt of declared dividend, annual report, transfer of Equity Shares and issue of duplicate/split/consolidated share certificates; b) Monitoring transfers, transmissions, dematerialization, re‐materialization, splitting and consolidation of Equity Shares and other securities issued by our Company, including review of cases for refusal of transfer/ transmission of shares and debentures; c) Reference to statutory and regulatory authorities regarding investor grievances; d) To otherwise ensure proper and timely attendance and redressal of investor queries and grievances; e) And to do all such acts, things or deeds as may be necessary or incidental to the exercise of the above powers.

During the financial year 2013‐14, one meeting of the shareholder’/investor’ grievance committee was held on 21st February 2014

The composition, names of members, chairperson, particulars of the meetings and attendance of the members during the year are as follows: Name of Director Category No. of meetings attended CS Sagar Sharma Chairman, Non‐Executive

Independent director 1

Ms. Kavita Jain Member, Non‐Executive Independent director

1

Mr. Dharmendra Bhuchhada Member, Non‐Executive Independent director

1

CA Arpan Shah Member, Non‐ Executive Professional Director

1

Details of Complaints received and redress during the period under review:

Opening: Nil Received: Nil Resolved: Nil Pending Complaints: Nil


6). General Body Meetings: The details of Annual General Meetings held during the last three years and special resolutions passed thereat are as follows:

Fin. Year Day, date and time Venue Special Resolution passed

201011 Saturday, September 24, 2011, 11:00 am

Plot no. 43, b/s Navneet Prakashan press, B/h Govt 'G' Colony, Sukhramnagar, Gomtipur, Ahmedabad‐ 380023

Nil

201112 Saturday, September 29, 2012, 10:00 am


Nil

201213

Tuesday, August 27, 2013, 11:00 am


Nil

Extraordinary General Meeting During the year under review, one Extra ordinary General Meeting was held on 6th May, 2013 for passing ordinary resolution under Section 293(1)(a) of Companies Act, 1956 for mortgaging/charging immovable and movable properties of the company. None of the business proposed to be transacted at the forthcoming Annual General Meeting is proposed to be conducted through Postal Ballot. Procedure for Postal Ballot and Voting Pattern: No special business was carried out in last three years by of Postal ballot. 7). Disclosures: a) Related Party Transaction The related party transactions are duly placed before the Audit Committee and for the financial year ended March 31, 2014, there were no transactions of material nature entered into with the related parties which were not on the arm’s length basis or that may have potential conflict with the interest of the Company at large. Related party transactions have been disclosed in the Note 2 (m) to the Annual Accounts of the Company for the financial year ended March 31, 2014. b) Statutory Compliance, Penalties and Strictures The Company has complied with the requirements of the Stock Exchanges / SEBI / and Statutory Authorities to the extent applicable, and accordingly no penalties have been levied or have been imposed on the Company on any matter related to capital markets.


c) Proceeds from the Initial Public Offer of the Company The Details about the utilization of the proceeds raised through Initial Public Offer of equity shares of the Company are disclosed to the Audit Committee. The Company has not utilized these funds for the purposes other than those mentioned in the prospectus of the Company.

(Rs. In Lacs) Sr. No. Object of Issue Preceeds Deployment as

per Offer Document

Actual Deployment

Deviation Remarks

1 Purchase and set up a Corporate House 1000.75 320.0 -680.75 as per note*

2 Long term Working Capital requirement 1574.75 2255.50 680.75 Nil3 General Corporate Purposes 109.30 109.30 N.A. Nil4 Issue related Expenses 90.00 90.00 N.A. Nil Total 2774.80 2774.80

*As a part of partial utilization of funds, KTL has entered into an MoU for constructing the Corporate House and utilized Rs. 3.20 Crores till date. While the remaining funds are not required currently until the corporate house project moves ahead, KTL has utilised the remaining funds for its current working capital requirements during the interim period (as mentioned in the Prospectus). As and when the funds would be required for the Corporate House, these monies shall be recouped from the Working Capital Loan Accounts and invested accordingly. d) Reconciliation of Share Capital Audit In line with the requirements stipulated by Securities and Exchange Board of India (SEBI), Reconciliation of Share Capital Audit is carried out on a quarterly basis by the statutory auditor to confirm that the aggregate number of equity shares of the Company held in National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) tally with the total number of issued, paid‐up, listed and admitted capital of the Company. . 8. Means of Communication The Annual/ Half yearly financial results are submitted to the Stock Exchange in accordance with the Listing Agreement and also uploaded on the Company’s website – www.kushaltradelink.com.


9. General Shareholder Information Sr. no.

Salient Items of Interest

Particulars

a) AGM : Date and Day Time venue

On Friday, August 22, 2014 11.00 A.M “Kushal House”, Plot No. 43, B/s Navneet Prakashan Press, B/h. Govt 'G' Colony, Sukhramnagar, Gomtipur, Ahmedabad – 380023 Gujarat, India

b) Financial year April 1st to March 31st

c) Date of Book closure August 18, 2014 to August 23, 2014 (both days inclusive)

d) Dividend Payment No Dividend has been declared

e) Listing on stock Exchange The Company’s equity shares are listed on SME Platform of BSE Limited. The listing fee for the year 2014‐15 has been paid.

f) Stock code/Symbol 536170/KUSHAL

g) Registrar and Share Transfer Agent

Bigshare Serivces Private LimitedE‐2 & 3, Ansa Industrial Estate, Saki‐Vihar Road, Sakinaka, Andheri(E), Mumbai ‐ 400 072. Tel: 91‐22‐28470652 | 40430200 | 28470653 Fax: 91‐22‐2847 5207 Website:www.bigshareonline.com email: [email protected]

h) Dematerialisation of shares and liquidity

As on March 31, 2014, all the Equity shares i.e 100 % of the total issued, subscribed and paid‐up equity share capital of the Company were held in dematerialised form. The Equity Shares of the Company are regularly traded on the BSE Limited.

i) Share Transfer System As all the shares are held in dematerialised mode, the transfer takes place instantaneously between the transferor, transferee, and the Depository Participant through electronic debit/credit of the accounts involved.

j) Outstanding GDRs/ADRs/ warrants or any convertible instruments, conversion date and likely impact on equity

Nil

k) Address for correspondence

Plot no. 43, B/s Navneet Prakashan Press, B/h Govt 'G' Colony, Sukhramnagar, Gomtipur, Ahmedabad‐ 380023 Telephone: +91‐79‐22772991 Mobile:+91‐9819111483 E‐Mail:[email protected] Web: www.kushaltradelink.com


l) Market Price Data Table below gives the monthly high and low prices and volumes of Kushal Tradelink Limited equity shares at SME Platform of BSE Limited for the year 2013‐2014: Month Low High Volume (000's)

September 2013 35.00 36.00 672.00October 2013 35.10 49.00 184.00November 2013 34.00 35.30 400.00December 2013 34.00 35.55 1260.00January 2014 33.25 34.25 292.00February 2014 33.25 35.50 1476.00March 2014 33.05 36.00 1140.00 Note: The Company got listed on 4th September 2013 on BSE SME platform.

m) Shareholdings as on March 31, 2014

Distribution of Equity Shareholdings as on March 31, 2014

Range of no. of Shares No. of Shareholders

% No. of Shares held

%

1‐5000 4 0.8869 369 0.00165001‐10000 1 0.2217 600 0.002530001‐40000 218 48.3370 871685 3.673950001‐100000 66 14.6341 527500 2.2232100001‐9999999999 162 35.9202 22326507 94.0988

TOTAL 451 100.0000 23726661 100.00

Distribution of Shareholdings as on March 31, 2014 Category No. of shareholders Shareholding %

Clearing Member 7 0.4074 Corporate Bodies 21 5.1931 Promoters 8 66.5861 Public 415 27.8134 TOTAL 451 100.00 Place: Ahmedabad On behalf of Board of Directors Date: May 1, 2014 Sandeep Agrawal (Managing Director) (DIN: 00239648)


Auditors’ Certificate on Corporate Governance To, The Members of Kushal Tradelink Limited, We have reviewed the compliance of the conditions of Corporate Governance by M/s. Kushal Tradelink Limited for the year ended March 31, 2014, as stipulated in Clause 52 of the Listing Agreement of the said Company with the Stock Exchange in India. The compliance of conditions of Corporate Governance is the responsibility of the management. Our review was limited to the procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company. In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in above mentioned Listing Agreement. We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company. For P. DOSHI & ASSOCIATES Chartered Accountants Registration No. 102740W CA Parthiv Doshi Proprietor M. No. 032295 Place: Ahmedabad Date: May 1, 2014


Annual Declaration by CEO / Managing Director Pursuant to Clause 52(1)(D)(Ii) Of the Listing Agreement

I, Sandeep Agrawal, Chairman and Managing Director of Kushal Tradelink Limited hereby declare that all the members of the Board of Directors of the Company and Senior Management Personnel have affirmed compliance with the Code of Conduct applicable to them as laid down by the Company in terms of Clause 52(1)(D)(ii) of the Listing Agreement entered into with the Stock Exchanges for the financial year ended March 31, 2014. Place: Ahmedabad FOR KUSHAL TRADELINK LIMITED Date: May 1, 2014 Sandeep Agrawal (Managing Director) (DIN: 00239648)


Certification by Managing Director and Chief Financial Officer on Financial Statements of the Company

We have reviewed the financial statements and the Cash Flow Statement for the year and that to the best of our knowledge and belief:

i. these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;

ii. these statements together present a true and fair view of the Company’s affairs and are in compliance with existing Accounting Standards, applicable laws and regulations.

(b) There are, to the best our knowledge the belief, no transactions entered into by the Company during the year which are fraudulent, illegal or violative of the Company’s code of conduct. (c) We are responsible for establishing and maintaining internal controls and that we have evaluated the effectiveness of the internal control systems of the Company and we have disclosed to the auditors and the Audit Committee, deficiencies in the design or operation of internal controls, if any, of which we are aware and the steps we have taken or propose to take to rectify these deficiencies. (d) We have indicated to the auditors and the Audit Committee:

i. significant changes in internal control over financial reporting during the year; ii. significant changes in accounting policies during the year and that the same have been disclosed in the

notes to the financial statements; and iii. Instances of significant fraud of which we have become aware and the involvement therein, if any, of

the management or an employee having a significant role in the Company’s internal control system over financial reporting.

Place: Ahmedabad FOR KUSHAL TRADELINK LIMITED Date: May 1, 2014 SANDEEP AGRAWAL CA VIMAL SHAH (MANAGING DIRECTOR) (CHIEF FINANCIAL OFFICER) (DIN: 00239648)


Annexure III to Directors’ Report

Management Discussion and Analysis Report 1). Industry Overview (structure and development) The Indian Paper Industry accounts for about 1.6% of the world’s production of paper and paperboard. It broadly covers the following: – Printing and writing – Newsprint – Paperboard and industrial packaging – Specialty In India, paperboard accounts for nearly 47.3% of the total market size, followed by writing and printing paper (29.6%), newsprint (19.5%) and specialty paper (3.6%) according to CRISIL Research.

Market Size

Paper Board

Printing Paper

Newsprint

Specialty paper

The estimated turnover of the industry is Rs 35,000 crore (USD 7 billion) approximately and its contribution to the exchequer is around Rs. 3000 crore (USD 0.6 billion). The industry provides employment to more than 0.37 million people directly and 1.3 million people indirectly. The industry was delicenced effective from July, 1997 by the Government of India; foreign participation is permissible. Most of the paper mills are in existence for a long time and hence present technologies fall in a wide spectrum ranging from oldest to the most modern. Changing Scenario in the Indian paper industry By consensus, the centre of gravity in the Pulp & Paper Industry, is shifting to Asia. Notwithstanding challenges, Indian Paper industry is growing at a healthy rate of 7‐8% Y‐o‐Y. With current per capita consumption of 11 Kg (approx.) against the world average of 55 Kg, there is a lot of headroom for growth. To make most of the potential, Paper industry in India is witnessing structural shift with respect to scale, technology, productivity, market Interface etc. Such structural changes are creating challenges for the existing business models. At the same time, a whole range of business opportunities have opened up both in manufacturing as well as distribution.


Raw material prices and availability, however, continues to be a serious concern. In the last one year Indian wood prices have almost doubled and the competition for raw material has intensified to unprecedented levels. For the first time in the history of Indian Paper Industry, import of wood has become a reality. In respect of other raw materials too, including waste paper and agro residues the situation is not comforting either. On sustainability front, Paper Industry is poised to emerge as one of the most sustainable industries. The industry is growing more trees than it harvests in India. Waste paper that is generated in daily life as well as agricultural waste which otherwise would have been burnt in the fields is being recycled by the industry to make paper. Sustainable plantations as a source of wood are also adding to the green cover in India. (Source: Indian Paper Manufacturer Association) 2). Company Overview Highlight’s of Company’s Consolidated performance for the year are as follows: Key Performance Indicators (Consolidated) (Rs. In Lacs)

Particulars 201314 201213*

1. Sales & Operating Earnings (Sales) 30251.85 24602.862. Cost of Materials 27840.39 22983.56 % of Sales 92.03% 93.42%3. Employee Benefit Expenses 149.61 132.91 % of Sales 0.49% 0.54%4. Operation and Other Expenses 605.13 223.43 % of Sales 2.00% 0.91%5. EBIDITA 1656.72 1262.96 % of Sales 5.48% 5.13%6. finance Costs 992.47 628.36 % of Sales 3.28% 2.55%7. Depreciation 27.09 23.94 % of Sales 0.09% 0.10%8. PAT 448.77 408.57 % of Sales 1.48% 1.66%9. Cash Profit 495.77 436.41 % of Sales 1.64% 1.77%* As there was no subsidiary in existence as at 31st march, 2013, the comparable figures above for Previous Year are taken from standalone financial statement. Operational Performance: The company continues to depict remarkable growth in Turnover and thereby proving its much needed role as a necessary Intermediary in the entire supply chain of paper industry. The company during the year has increased its market share in the product of Paper Waste which is being supplied to paper mill as raw material for recycling. For paper waste the company is focusing and further exploring the overseas market like USA, Dubai, Srilanka, Switzerland etc. to get the better quality of waste paper for high fiber content. The increased focus on waste supply has resulted in consequential market share for the Kraft Paper being finished paper made out of the waste supplied. This also helps the company in mitigating the risk considering the fact that the paper mills become the customer and supplier both for the company.


3). Segment–wise or productwise performance. The group has only two reportable segments based on its geographical base. The segmental reporting is reported as part of notes to accounts which forms integral part of the accounts. 4) Risk Management The company works as an important intermediary in the supply chain of paper industry. The company procures paper being paper waste from overseas market. Hence it is subject to business risk internal as well as external. The company has a comprehensive risk management system in place which enables the company to recognize and analyze risks early and to take appropriate action to mitigate them. The senior management of the company reviews the risk management policy and process of the company for effective risk management. The company is subject to risks arising from interest fluctuation. Also the company is exposed to Forex Fluctuation risk also. The Senior management works with the businesses to establish and monitor the specific profiles including both strategic, financial and operational risks. However we believe that the risks of interest rate and Forex risks are mitigated due to our unique business model in supplying to and procuring from the same entities. 5). Material Development in Human Resources The Company has continued to give special attention to Human Resources/Industrial relations development. Industrial relations remained cordial throughout the year and there was no incidence of strike, lock out etc. Our work force consist of :

(i) Our Permanent employees The total number of employees as on March 31, 2014 is 53

(ii) Consultants which are engaged by us on professional basis.

6). Cautionary Statement Some Statements in this discussion may be forward looking. Future performance may however differ from those stated in the management discussion and analysis on account of various factors such as changes in Government regulations, tax regimes, impact of competition, etc. Place: Ahmedabad On behalf of Board of Directors Date: May 1, 2014 Sandeep Agrawal (Managing Director) (DIN: 00239648)


Independent Auditor’s Report

To The Members Kushal Tradelink Limited Report on the Financial Statements

We have audited the accompanying financial statements of M/s. KUSHAL TRADELINK LIMITED, AHMEDABAD which comprise the Balance Sheet as at March 31, 2014 , the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial Statements

The Company’s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub‐section (3C) of section 211 of the Companies Act, 1956 (“the Act”). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with the ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control relevant to the Company’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2014

(b) in the case of the Statement of Profit and Loss, of the profit of the Company for the year ended on that date and

(c) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.


Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2003(“the Order”) issued by the Central Government of India in terms of sub‐section (4A) of section 227 of the Act, we give in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by Section 227(3) of the Act, we report that:

(a) We have 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, Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the Balance Sheet, Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards referred to in sub‐section (3C) of section 211 of the Act.

(e) On the basis of the written representations received from the directors as on 31st March, 2014 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2014 from being appointed as a director in terms of clause (g) of sub‐section (1) of section 274 of the Act.

For P. DOSHI & ASSOCIATES Date: May 1, 2014 Chartered Accountants Place: Ahmedabad Registration No. 102740W CA Parthiv Doshi Proprietor M. No. 032295


Annexure to the Auditor's Report

As required by the Companies (Auditor's Report) Order, 2003, issued by the Government of India and in the terms of the information and explanations given to us and on the basis of such check as we considered appropriate, we further report that :

1) The Company is maintaining proper record showing full particulars, including quantitative details and situation of its fixed assets. The management has physically verified these fixed assets according to a phased program designed to cover all the items which in our opinion is reasonable having regard to the size of the company and the nature of its assets. As reported no material discrepancies were noted during the verification. The fixed assets disposed off during the year do not constitute the substantial part of the fixed assets of the company and such disposal has in our opinion, not effected the Going Concern status of the company.

2) The management has at reasonable interval conducted the physical verification of inventories except stock in transit (if any) and the system for which in our opinion is commensurate with the size of the company. There were no material discrepancies found during the verification as reported to us. Proper records for inventory are maintained and procedures for verification of inventory are satisfactory looking to the size and nature.

3) The Company has not granted/nor received any loans, secured or unsecured to Companies, Firms or other Parties required to be covered in the Register maintained u/s 301 of the Act, 1956. In view of the same the provisions of clause 4(iii) (b) to 4(iii) (d) are not applicable.

4) In our opinion and According to the information and explanations given to us the company has adequate internal control procedure commensurate with the size and nature of the company's business, for the purchase of inventory and fixed assets and for the sale of goods. During the course of audit, no major weakness has been noticed in the system of Internal Control.

5) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that need to be entered in the register maintained under section 301 of the Companies Act, 1956 have been so entered and each of these transactions for value exceeding Rs. 5 Lacs have been made at prices which are appear having regard to the prevailing market price at that time.

6) As informed to us and based on the records verified by us, the Company has not accepted any deposits which fall under the purview of sections 58A & 58AA of the Companies Act,1956. Further no order has been passed by the CLB, NCLT or RBI or any court or any other Tribunal.


7) As per the information and explanation given to us by the management, the Company’s internal control procedures together with the internal checks conducted by the group internal audit team during the year can be considered as an internal audit commensurate with the size and nature of its business.

8) The provision of section 209(1) (d) of the Companies Act, 1956, in respect of maintenance of cost records are not applicable to the Company and and hence the said records have not been maintained.

9) As explained to the statutory dues payable by the company comprises of Provident Fund, Investor Education and Protection Fund, ESIC, Income Tax, VAT, Wealth Tax, Service Tax, Customs Duty, Municipal Tax. According to the records of the company, the company is generally regular in depositing undisputed statutory dues with the appropriate authorities. There are no undisputed statutory dues as referred to above as at 31st March, 2014 outstanding for a period of more than six months from the date they become payable. There are no disputed statutory dues pending to be paid as at 31/03/2014.

10) The company has no accumulated losses as at the year end. In our opinion and according to the records of the company, the company has not incurred cash losses during the financial year covered by our audit and also in immediately preceding financial year.

11) Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a Bank. The company has not borrowed any sums through Financial Institution or Debentures.

12) According to information and explanations given to us, the Company has not granted loans and advances on the basis of securities by way of Pledge of shares, debentures and other securities. Accordingly the provisions of clause 4(xii) of the order are not applicable.

13) In our opinion, considering the nature of activities carried on by the Company during the year, the provisions of any special statute applicable to chit fund/nidhi/mutual benefit funds/societies are not applicable to the company. Accordingly the provisions of clause 4(xiii) of the order are not applicable.

14) In respect of dealing in securities and other investment, in our opinion and according to the information and explanations given to us, proper records have been maintained of the transactions and contracts and timely entries have been made therein. All the investments at the end of the year are held in the name of the company.


15) In respect of guarantees given by the Company for loans taken by others from banks, the terms and conditions are prima facie not prejudicial to the interest of the Company.

16) The company has not raised term loans during the year and hence clause 4(xvi) of the order is not applicable.

17) In our opinion and the information and explanations given to us, on an overall basis, funds raised on short term basis have not, prima facie, been used during the year for long term investment except permanent working capital.

18) Company has not made preferential allotment of Shares to parties covered in the Register maintained under section 301 of the Act and clause 4(xviii) of the order are not applicable.

19) No debentures have been issue by the company during the year as well no debentures are outstanding at the year end and hence provisions of clause 4(xix) of the Order are not applicable.

20) The company has raised an amount of Rs. 27.75 Crores during the year via an IPO. The relevant disclosure regarding end use have been made as a part of report on Corporate Governance by the management. We have verified the same on the basis of information and explanation given to us and the same is found to be in order.

21) Based upon the audit procedures performed and information and explanation given by the management no fraud on or by the company has been noticed or reported during the year by the management.



Balance Sheet As At 31 March, 2014 (Rs. In Lacs)

Particulars Notes As at 31 March, 2014 As at 31 March, 2013

A EQUITY AND LIABILITIES 1 Shareholders’ Funds (a) Share Capital 3 2,372.67 1579.87 (b) Reserves and Surplus 4 3,001.71 549.89 2

Noncurrent liabilities

5374.38 2129.76

(a) Long Term Borrowings (b) Long Term Provisions

5 6

NIL 13.16

775.00NIL

(b) Deferred Tax Liabilities (net) 7 14.39 17.47 27.55 792.47 3 Current liabilities (a) Short Term Borrowings 8 7,158.70 4189.40 (b) Trade Payables 9 537.15 1657.99 (c) Other Current Liabilities 10 599.53 52.51 (d) Short Term Provisions 11 225.00 200.00 8520.38 6099.90 TOTAL 13922.31 9022.13 B ASSETS 1 Noncurrent assets (a) Fixed Assets Tangible assets 12 383.30 341.46 (b) Non Current Investment 13 289.85 15.13 (c) Long Term Loans & Advances 14 509.52 157.39 (d) Other Non Current Assets

15 80.02 39.75

1262.69 553.73 2 Current assets (a) Inventories 16 641.79 764.46 (b) Trade Receivables 17 10,145.89 6987.81 (c) Cash and Bank Balance 18 791.05 72.75 (d) Short Term Loans and Advances 19 1,080.89 643.38 12659.62 8468.40 TOTAL 13922.31 9022.13 Significant Accounting Policies

2

The accompanying Notes are an integral part of the Financial Statements For P. DOSHI & ASSOCIATES For and on behalf of the Board of Chartered Accountants KUSHAL TRADELINK LIMITED FRN NO:102740W CA PARTHIV DOSHI SANDEEP AGRAWAL MAHENDRA AGRAWAL Proprietor Managing Director Whole Time Director M. No : 032295 Date : May 1, 2014 CS Khushboo Surana CA Vimal Shah Place: Ahmedabad Company Secretary Chief Financial Officer Date: May 1, 2014 Place: Ahmedabad


Statement of Profit and Loss for the Year Ended 31 March, 2014

(Rs. In Lacs) Particulars Notes For the year

ended 31 March, 2014

For the year ended

31 March, 2013

A CONTINUING OPERATIONS 1 Revenue From Operations 20 30050.28 24602.862 Other Income 21 31.88 (3.21)3 Total Revenue 30082.16 24599.65 4 Expenses (a) Purchases of Traded Goods 22 27523.66 22789.64 (b) Changes in Inventories of Traded Goods 23 122.67 193.92 (c) Employee Benefits Expenses 24 149.61 132.91 (d) Finance Costs 25 964.48 628.36 (e) Depreciation and Amortization Expenses 12 27.09 23.94 (f) Other Expenses 26 604.56 223.43 Total Expenses 29392.07 23992.21 5 Profit / (Loss) Before Exceptional and Extraordinary

Items and Tax (3 4) 690.09 607.44

6 Exceptional Items NIL NIL7 Profit/(Loss) Before Extraordinary Items & Tax (5 +

6) 690.09 607.44

8 Extraordinary Items NIL NIL9 Profit / (Loss) Before Tax (7 + 8) 690.09 607.4410 Tax expense: (a) Current Tax Expense for Current Year (Tax Provisions) 225.00 200.00 (b) Current Tax Expense relating to Prior Years (1.65) (1.88) (c) Net Current Tax Expense 223.35 198.12 (d) Deferred Tax Provision 6 (3.08) 0.76 Total Tax Expense 220.27 198.88

11 Profit/(Loss) from Continuing Operations (9 +10) 469.82 408.5612 Earnings Per Share (of 10/ each): (a) Basic & Diluted (i) Continuing Operations 2.30 2.59 (ii) Total Operations 2.30 2.59 Significant Accounting Policies 2 For P. DOSHI & ASSOCIATES For and on behalf of the Board of Chartered Accountants KUSHAL TRADELINK LIMITED FRN NO:102740W CA PARTHIV DOSHI SANDEEP AGRAWAL MAHENDRA AGRAWAL Proprietor Managing Director Whole Time Director M. No : 032295 Date : May 1, 2014 CS Khushboo Surana CA Vimal Shah Place: Ahmedabad Company Secretary Chief Financial Officer Date: May 1, 2014 Place: Ahmedabad


Cash Flow Statement for the Year Ended 31st March 2014

Particulars For the Year ended on For the year ended on 31 March,2014 31 March,2013

Cash Flows from Operating Activities Net Profit Before Taxation 690.09 607.44 Adjustment for : Depreciation 27.09 23.94 Interest Expenses 964.48 628.36 Profit / Loss on Sale of Fixed Assets / Investments 0.44 3.90 Operating Profit Before Working Capital Changes 1682.10 1263.64

Changes in Current Assets (excl. Cash and Bank Bal.) (4190.16) (2329.83) Change in Debtors (3158.09) (2214.33)Change in Inventories(Stock‐in‐Trade) 122.67 193.92 Change in Other Current Assets (1154.74) (309.42) Changes in Current Liabilities( excl. Dividend) 2433.63 1534.96 Change in Creditors (1120.82) 931.07 Change in Bank Borrowings 2969.30 597.47 Change in Other Current Liabilities 585.15 6.42 Cash Generated from Operations (74.43) 468.77 Income Tax (excl. Deferred Tax) 223.35 198.12 Cash from Operations Before Extraordinary Items (297.78) 270.65 Extraordinary Items 0.00 0.00 Net Cash from Operating Activities ( 1 ) (297.78) 270.65 Cash Flows from Investing Activities Purchase / Sale of Fixed Assets (69.36) (69.99)Change in Non Current assets (626.86) 286.54 Net Cash (Used)/Generated in/from Investing Activities ( 2 ) (696.22) 216.55

Cash Flow continued…


Cash Flows from Financing activities Interest Expenses (964.48) (628.36)Increase / Decrease in Share Capital 792.80 0.00 Change in Securities Premium 1982.00 0.00 IPO Expenses (40.26) (18.47)Change in Other Short/Long Term Debts (775.00) 141.95 Net Cash from (Used)/Generated in/from Financing Activities ( 3 ) 995.06 (504.88) Net Increase in Cash & Cash Equivalents ( 4 )=( 1 ) + ( 2 )+( 3 ) 1.06 (17.68) Cash & Cash Equivalents at Beginning of the Year (5) 12.12 29.80 Cash & Cash Equivalents as at 31st Mar, 2014(4 )+(5) 13.18 12.12 For P. DOSHI & ASSOCIATES For and on behalf of the Board of Chartered Accountants KUSHAL TRADELINK LIMITED FRN NO:102740W CA PARTHIV DOSHI SANDEEP AGRAWAL MAHENDRA AGRAWAL Proprietor Managing Director Whole Time Director M. No : 032295 Date : May 1, 2014 CS Khushboo Surana CA Vimal Shah Place: Ahmedabad Company Secretary Chief Financial Officer Date: May 1, 2014 Place: Ahmedabad


Notes forming part of the Financial Statements for the year ended 31st March, 2014

1. Corporate Information Kushal Tradelink Limited (KTL) is a Public Company domiciled in India incorporated under Companies Act, 1956. The company along with its WOS (Kushal Group) is engaged in the business of trading of various kind of paper, paper waste and other merchandise.

2. Summary of Significant Accounting Policies

a). Basis of Preparation of Financial Statement

i). The Financial Statements of the company have been prepared and presented in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) under the historical cost convention on an accrual basis. The company has prepared these financial statements to comply in all material respects with the Accounting Standards notified under the Companies (Accounting Standard) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The accounting policies adopted in the preparation of the financial statements are consistent with those of previous year.

ii) Use of Estimates

The preparation of the financial statements in conformity with Indian GAAP requires the management to make judgment, estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent liabilities on the date of financial statements and reported amounts of revenues and expenses for the year. Although these estimates are based on Management’s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes different from the estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Any revision to accounting estimates is recognized prospectively in the current and future periods.

iii). Current & NonCurrent Classification

All the assets and liabilities have been classified as current or non‐current as per the company’s normal operating cycle and other criteria set out in Revised Schedule VI to the companies act, 1956. Based on the nature of activities and time between the activities performed and their subsequent realization in cash or cash equivalents, the company has ascertained its operating cycle as 12 months for the purpose of current/ non –current classification of assets and liabilities.

b) Inventories

Inventories (Stock‐In‐Trade) are valued at lower of Cost or Net Realisable Value by following FIFO Method.

c) Cash Flow Statement

i) Cash & cash Equivalents (for purpose of cash flow statement)

Cash comprises cash on hand and demand deposit with banks. Cash Equivalents are short‐term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.


ii) Cash Flow Statement

Cash flows are reported using the indirect method, whereby profit/ (loss) before extraordinary items and tax is adjusted for the effects of transactions of non‐cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, financing and investing activities of the company are segregated.

d) Prior Period and Exceptional items

i) All identifiable items of income and expenditure pertaining to prior period are accounted through “ Prior Period items”.

ii) Exceptional items are generally non‐recurring items of income and expense within profit or loss from ordinary activities, which are of such size, nature or incidence that their disclosure is relevant to explain the performance of the Company for the year.

e) Depreciation

Depreciation on fixed Assets is provided on straight‐ line method at rates and in the manner specified in Schedule XIV to the Companies Act, 1956 read with the relevant circulars issued by the Ministry of Corporate Affairs.

f) Revenue Recognition:

Revenue is recognised when consideration can be reasonably measured and there exists reasonable certainty of its recovery.

i) Sales of Goods are recognised when the significant risk and rewards of ownership of the goods have been passed to the customer and net of Value added tax and return.

ii) Other Incomes are recognised on receipt of confirmation regarding acceptance of claim form the counterpart or when it is a part of oral expressed understanding.

iii) Interest Income is recognised on time proportion basis taking into account the amount outstanding and the rate applicable.

g) Fixed Assets

Tangible fixed assets.

Fixed assets are stated at cost of acquisition or construction. They are stated at historical cost less accumulated depreciation and Impairment losses, if any. Cost comprises the purchase price, import duty and other non‐ refundable taxes or levies and any directly attributable cost of bringing the asset to its working condition for its intended use. Borrowing cost relating to acquisition /construction of fixed assets which take substantial period time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use.


h) Foreign Currency Transactions

i) Initial Recognition and measurement

Foreign currency transaction is recorded, on initial recognition in the reporting currency by applying to the foreign currency amount at the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

ii) Subsequent Measurement

Foreign currency receivables, payables and investments in subsidiary (monetary items) are subsequently measured as stated below:

At the year‐ end, monetary items denominated in foreign currencies, other than those covered by forward contracts are converted into rupee equivalents at the year‐ end exchange rates

iii) Exchange Differences

All exchange differences arising on settlement and conversion of foreign currency transaction are included in the Statement of Profit and loss.

iv) Forward Exchange Contracts.

The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and forecasted transactions.

The use of such foreign currency forward contracts is governed by the company’s policies approved by the management, which provide principles on use of such financial derivatives consistent with the company’s risk management strategy. The company does not use derivative financial statements for speculative purposes.

In respect of transactions covered by forward exchange contracts, the difference between the year‐ end rate and the exchange rate at the date of contract is recognised as exchange difference and the premium paid on forward contracts is recognised over the life of the contracts.

i) Investments

i). Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments.

ii) Long term investments are stated at cost. Provisions for diminution in the value of long term investments are made only if such a decline is other temporary in the opinion of the management.

j) Employee Benefits

Short term Employee Benefits

Short term employees are recognised as an expense at the undiscounted amount in the Statement of Profit and loss of the year in which the related services is rendered.

Post Employment Benefits


i). Defined Contribution Plans

The Company’s State governed Provident Fund Scheme, Employee State Insurance Scheme and Labour Welfare Fund Scheme are considered as defined contribution plans. The contribution under the schemes is recognised as an expense in the Statement of Profit and loss, as they are incurred. These are no other obligations other than the contribution payable to the respective funds

ii) The company makes payment for earned leave on year to year basis and accordingly the same is recognised as an expense on year to year basis.

iii) Till last year, the company did not make any provisions for Gratuity. However the same has been recognised as an expense on the basis of age and length of service of employees of the company, the track record of employee turnover, the retirement age and by applying appropriate discount factor.

k) Borrowing costs

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to Statement of Profit and loss.

l) Segment Accounting

Based on guiding principles given in Accounting Standard on “ Segment Reporting”‐ AS 17 as specified in the companies (Accounting Standard) rules, 2006 (as amended) , single financial report contains both Standalone financial statement and consolidated financial statement of the company. Hence, the required segment information has been appended in the Consolidated Financial Statement (CFS).

m) Related Party transactions

Disclosure of transactions with related parties, as required by Accounting Standard 18 “Related Party Disclosure” as specified in the Companies (Accounting Standard) Rules, 2006 (as amended), has been set out in a separate statement annexed to this note. Related parties as defined under clause 3 of the Accounting Standard 18 have been identified on the basis of representation made by the management and information available with the company.

n) Leases

Lease arrangement where risk and rewards incidental to ownership of an asset substantially vest with the Lessor are recognized as Operating Leases. The Company’s significant Leasing arrangement are in respect of operating leases for immovable property which includes residential premises, office, godowns, etc. The aggregate lease rentals payable/receivables are recognized as expenditure/income in the statement of profit and loss as per the respective lease agreements.

o) Earning Per Share

The company reports basic and diluted earnings per share (EPS) in accordance with the Accounting Standard 20 as specified in the Companies (Accounting Standard )Rules,2006 (as amended). The Basic EPS has been computed by dividing the income available to equity shareholders by the weighted average number of equity shares outstanding during the accounting year. There are no dilutive potential equity shares so Diluted EPS.


p) Provision for Tax

Tax expenses comprises of current tax and deferred tax.

1) Current Tax Provision for taxation has been made in accordance with the direct tax laws prevailing for the relevant assessment years.

2) Deferred Tax

In accordance with the Accounting Standard 22‐ Accounting for Taxes on Income, as specified in the Companies (Accounting Standard) Rules 2006 (as amended), the deferred tax for timing differences between the book and tax profits for the year is accounted for by using the tax rates and Laws that have been enacted or substantively enacted as of the Balance Sheet Date.

Deferred tax assets arising from timing differences are recognised to the extent there is virtual certainty that the assets can be realized in future.

Net outstanding balance in Deferred Tax account is recognized as deferred tax liability /asset. The deferred tax account is used solely for reversing timing difference as and when crystallized.

q) Impairment of Fixed Assets

1) The carrying amount of assets, other than inventories, is reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the assets recoverable amount is estimated.

2) The impairment loss is recognized whenever the carrying amount of an asset or its cash generation unit exceeds its recoverable amount. The recoverable amount is the greater of the asset’s net selling price and value in the uses which is determined based on the estimated future cash flow discounted to their present values. All impairment losses are recognized in the statement of Profit and Loss.

3) An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount and is recognised in the Statement of Profit and Loss.

r) Provision, Contingent Liabilites and Contingent Assets

Provision are recognized for when the company has at present, legal or contractual obligation as a result of Past events, Only if it is probable that an outflow of resources embodying economic outgo or loss will be required and if the amount involved can be measured reliably.

Contingent liabilities being a possible obligation as a result of Past events, the existence of which will be confirmed only by the occurrence or non occurrence of one or more future events not wholly in control of the company are not recognized in the accounts. The nature of such liabilities and an estimate of its financial effect are disclosed in notes to the Financial Statements.

Contingent assets are neither recognized nor disclosed in the financial statements.

s) Expenditure

Expenses are net of taxes recoverable, where applicable.


t) Accounting of claims

i). Claims received are accounted at the time of lodgment depending on the certainty of receipt and claims payable are accounted at the time of acceptance.

ii). Claims raised by Government authorities regarding taxes and duties, which are disputed by the company, are accounted based on legality of each claim. Adjustments, if any, are made in the year in which disputes are finally settled.

u). Doubtful debts. Advances

Provision is made in the accounts for debts/ Advances which in the opinion of the management are considered doubtful of recovery.


Notes on the Financial Statements for the Year Ended on 31st March 2014

Note 3 Share Capital

(Rs. In Lacs) Particulars As at 31 March, 2014 As at 31 March, 2013

Number of shares

Amount Number of shares Amount

(a) Authorised Equity Shares of Rs. 10 each with Voting Rights 25000000 2500.00 25000000 2500.00 (b) Issued , Subscribed and Paid Up Equity Shares of Rs. 10 each with Voting Rights 23726661 2372.67 15798661 1579.87

Total 23726661 2372.67 15798661 1579.87

(a) Reconciliation of the number of shares and amount outstanding at the beginning and at the end of the reporting period:

Particulars Opening Balance

Buy back Issued During the Year*

Closing Balance

Equity Shares with Voting Rights Year ended 31 March, 2014 ‐ Number of Shares 15798661 NIL 7928000 23726661‐ Amount (Rs. in Lacs) 1579.87 NIL 792.80 2372.67

Year ended 31 March, 2013 ‐ Number of Shares 15798661 NIL NIL 15798661‐ Amount (Rs. In Lacs) 1579.87 NIL NIL 1579.87

* During the year the company came up with an IPO of 7928000 Equity Shares of Rs. 10 each (fully paid up), pursuant to which 7928000 Equity Shares were allotted to the Subscribers of IPO.

(b) Terms/rights attached to Equity Shares:

The Company has only one class of shares referred to as equity shares having Face Value of Rs. 10/‐ per share. Each holder of Equity Share is entitled to one Vote per Share.

(c ) Aggregate Number of Bonus Shares Issued, Shares Issue for Consideration Other Than Cash and Shared Bought Back During the Period of Five Years immediately preceding the Reporting Date

Particulars As at 31st March, 2014 As at 31st March, 2013Equity Shares issued as fully paid Bonus Shares by Capitalisation of Securities Premium

7021629 7021629

Total 7021629 7021629


(d) Details of shareholders holding more than 5% Shares in the Company

Class of Shares / Name of Shareholder As at 31 March, 2014 As at 31 March, 2013 Number of Shares held

% Holding in that Class of Shares

Number of shares held

% holding in that class of shares

Equity shares with voting rights Sandeep T. Agrawal 1352340 5.70% 1352340 8.56%Manoj T. Agrawal 2054160 8.66% 2054160 13.00%Mahendra T. Agrawal 2270160 9.57% 2270160 14.37%Sangita M. Agrawal 855360 3.61% 855360 5.41%Namrata S. Agrawal 4622465 19.48% 4622465 29.26%Pushpa T. Agrawal 2160022 9.10% 2160022 13.67%Tulsiram C. Agrawal 2484000 10.47% 2484000 15.72%

Total 15798507 66.59% 15798507 99.99% Note 4 Reserves and Surplus (Rs. In Lacs) Particulars As at 31 March,

2014 As at 31 March,

2013

(a) Securities Premium

Opening Balance NIL NILAdd : Premium on Equity Shares Issued during the Year 1982.00 NILClosing Balance 1982.00 NIL

(b) Surplus / (Deficit) in Statement of Profit and Loss

Opening balance 548.81 140.25Add: Profit / (Loss) for the Year 469.82 408.56Closing Balance 1018.63 548.81

(c) General Reserve

Opening Balance 1.08 1.08Add: Addition during the Year NIL NILClosing balance 1.08 1.08

Total 3001.71 549.89 Note 5 Long Term Borrowings


Non current

Current Non

current Current

(a) Loans and Advances from Related Parties

Unsecured NIL NIL NIL NIL Total

NIL NIL NIL NIL

(b)Other Loans and Advances (Unsecured) NIL NIL 775.00 NIL

Total NIL NIL 775.00 0.00


Note 6 Long Term Provisions

(Rs. In Lacs) Particulars As at 31 March,


2013

Provision for Gratuity 13.16 NIl

Total 13.16 Nil

Note 7 Deferred Tax Liability (Net)

(Rs. In Lacs)

Particulars As at 31 March, 2014

As at 31 March, 2013

Deferred Tax Liabilities

Tax effect of items constituting Deferred Tax Liability Depreciation 18.46 17.47

Tax effect of items constituting Deferred Tax Liability(A) 18.46 17.47

Tax effect of items constituting deferred tax assets

Gratuity 4.07 NIL

Tax effect of items constituting Deferred Tax Assets(B) 4.07 NIL Net deferred Tax Liability (AB) 14.39 17.47

Note 8 Short Term Borrowings

(Rs. In Lacs)


As at 31 March, 2013

From Banks

Cash Credit Facilities‐ Secured (Refer Note below)

6092.26 3720.34

Buyer's Credit Facilities‐ Secured (Refer Note below) 1066.44 469.06

Total 7158.70 4189.40

Note: The said credit facilities are secured by pledge of FDRs and pari passu charge by way of hypothecation on all the current assets of the company amongst the bankers. Further, the said Facilities are also secured by first and pari passu charge by way of EQM on some of the fixed assets of the company and some immovable properties owned by Executive Directors and their relatives as collateral. Also all the facilities are secured by the Personal Guarantee of the Executive Directors and their relatives.


Note 9 Trade Payables



2013

Acceptances NIL NILOther than Acceptances* 537.15 1657.99

Total 537.15 1657.99

*Disclosures required u/s 22 of MSMED Act, 2006: There are no Overdue Principal remaining unpaid to any supplier. Further, there are no interest paid/ accrued/ due to any such supplier. 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. This has been relied upon by the auditors. Note 10 Other Current Liabilities



2013

Statutory Dues 6.65 2.39

Payable for Expenses 3.44 7.32

Advances from Customers 4.23 42.80 Amount Payable to Bank (Forward Contract) 585.21 0.00

Total 599.53 52.51

Note 11 Short Term Provisions



2013

Provision for Income Tax 225.00 200.00

Total 225.00 200.00


Note 13 Non Current Investments (Rs. In Lacs)

Particulars As at 31 March, 2014 As at 31 March, 2013 Quoted Unquoted Total Quoted Unquoted Total

Investment in Quoted Shares ( At Cost ) * 15.13 NIL 15.13 15.13 NIL 15.13Investment in WOS ** NIL 31.10 31.10 NIL NIL NILInvestment Properties NIL 243.62 243.62 NIL NIL NIL

Total 15.13 274.72 289.85 15.13 NIL 15.13 *This is Non Trade Investment comprising of 84894 Quoted Shares of Shree Rama Multi Tech Ltd. Having Market Value of Rs. 2.93 per Share [MV 2.49 Lacs (PY 3.81 Lacs)]. **Includes Trade Investment made in Singapore based WOS named as Kushal Impex Pte. Ltd. Out of this, the amount of Rs. 29.86 Lacs is lying in Share Application Money pending Allotment by the said WOS. Note 14 Long Term Loans and Advances


(a) Security Deposits (Unsecured, Considered Good) 28.16 21.12

(b) Other Advances Advance for Fixed Assets 481.36 136.27

Total 509.52 157.39

Note 15 Other Non Current Assets


Unamortised Preliminary Expenses 80.02 39.75

Total 80.02 39.75

Note 16 Inventories


Stock in Trade 641.79 764.46

Total 641.79 764.46


Note 17 Trade receivables



2013

Trade receivables outstanding for a period exceeding six months from the date they were due for payment

Unsecured, considered good 221.71 637.57 Trade receivables outstanding for a period less than six months from the date they were due for payment

Unsecured, considered good 9924.18 6350.24

Total 10145.89 6987.81

Note 18 Cash and Bank Balance



2013

Cash and Cash Equivalents Cash on hand 3.77 10.97 Balances with banks in Current Accounts 9.41 1.15

13.18

12.12

Other Bank Balances Margin Money (for LC/Buyers Credit/SBLC) 365.00 60.00Other bank Deposits (Pledged with Banks as Collaterals) 400.42 NILInterest Accrued but Not Due 12.45 0.63 777.87 60.63

Total 791.05 72.75

Note 19 Short Term Loans and Advances


Prepaid Expenses 11.15 3.50 Balances with Tax Authorities 239.24 201.85Advance to Suppliers 141.35 438.03Foreign Currency Receivable (Forward Contract) 575.77 NILPayments made on behalf of WOS 113.38 NIL

Total 1080.89 643.38


Note 20 Revenue from Operations (Rs. In Lacs)

Particulars For the year ended

31 March, 2014

For the year ended

31 March, 2013

(a) Sale of Products (Refer Note (i) below) 29943.03 24403.95 (b) Other Operating Income (Refer Note (ii) below) 107.26 198.91 Total 30050.28 24602.86

Note 20(i)


31 March, 2014

For the year ended

31 March, 2013

Various kind of Paper (Net of VAT) 29943.03 24403.95 Total Sale of traded goods 29943.03 24403.95

Note 20(ii)


31 March, 2014

For the year ended

31 March, 2013

Other Operating Income comprises: Claim from/to Suppliers/Customers (net) 10.09 1.05 Rate Differences/Discount/Interest on Delay Payment 46.52 46.83 Recoveries from Customers towards various Charges 34.43 20.31 Import Claims 13.73 121.81 Round off 0.06 0.05 Other Income 2.43 8.86 Total 107.26 198.91

Note 21 Other Income


31 March, 2014

For the year ended

31 March, 2013

Interest on FDRs 32.32 0.69Net Gain/(Loss) on Sale of Fixed Assets (0.44) (3.90)

Total 31.88 (3.21)


Note 22 Purchase of Traded goods

(Rs. In Lacs) Particulars For the year


For the year ended

31 March, 2013

Various Kind of Papers 27523.66 22789.64

Total 27523.66 22789.64

Note 23 Changes in Inventories of Traded Goods



For the year ended

31 March, 2013

Inventories at the beginning of the Year:Traded Goods 764.46 958.38 764.46 958.38Inventories at the end of the Year: Traded Goods 641.79 764.46

641.79 764.46

Net (Increase) / Decrease 122.67 193.92

Note 24 Employee Benefits Expense



For the year ended

31 March, 2013

Salaries and Bonus 99.62 83.58Managerial Remuneration 24.00 40.00Contributions to Provident Fund 8.91 7.48ESIC Expense 1.18 0.60Gratuity (Current Period) 1.06 NILGratuity (Prior Period) 12.10 NILStaff Welfare Expenses 2.74 1.25

Total 149.61 132.91


Note 25 Finance Costs (Rs. In Lacs)


31 March, 2014

For the year ended

31 March, 2013

(a) Interest Expense on: (i) Borrowings 688.80 465.19(ii) Others

‐ Interest on Unsecured loan NIL 14.31‐ Other Interest 0.02 3.21

(b) Other Borrowing Costs (Refer note below) 138.89 88.64 (c) Net (gain) / Loss on Foreign Currency Transactions and Translation (considered as Finance Cost) 136.77 57.01

Total 964.48 628.36

Note 25 (i) Other Borrowing Cost

(Rs. In Lacs) Particulars

For the year ended

31 March, 2014 For the year ended 31 March, 2013

Amt.Rs Amt.Rs Bank charges 56.23 52.98Bank Loan Process Fees 33.71 21.21Loan franking exp 19.21 8.60Other Finance Charges 28.42 5.85Forward Premium 1.32 NIL

TOTAL 138.89 88.64 Note 26 Other Expenses



For the year ended 31 March, 2013

Amt.Rs Amt.Rs

Insurance Premium 6.75 5.14Audit Fees (Statuary Audit & Tax Audit) 1.40 1.41Electricity Expense 9.10 8.72Foreign Exchange Losses(To the extent Not considered as Finance cost) 467.76 91.86Municipal Expense 1.75 1.36Repairs & Maintenance 1.17 1.33Vehicle Repair & Fuel Expenses 38.27 37.32Rent Expenses 10.38 10.38Miscellaneous Expenses 67.98 65.91

Total 604.56 223.43


Note 12 Fixed Assets

(Rs. In Lacs)

Tangible assets Gross Block Accumulated Depreciation and Impairment Net Block Balance

as at 1 April, 2013

Additions Disposals Balance as at 31

March, 2014

Balance as at 1 April, 2013

Depreciation /

Amortisation Expense for the Year

Eliminated on Disposal of Assets

Balance as at 31

March, 2014

Balance as at 31

March, 2014

Balance as at 31

March, 2013

Land

135.23 0.00 0.00 135.23 0.00 0.00 0.00 0.00 135.23 135.23

Buildings 1.63% 23.20 5.09 0.00 28.29 2.40 0.41 0.00 2.81 25.48 20.80

Plant and Equipment 4.75%

31.38 52.78 0.72 83.44 5.28 1.64 0.05 6.88 76.56 26.10

Furniture and Fixtures 6.33%

12.10 0.00 0.00 12.10 5.05 0.77 0.00 5.82 6.28 7.05

Vehicles 9.50% 175.49 9.07 0.00 184.56 44.63 17.15 0.00 61.78 122.77 130.86 Vehicles 11.31% 43.83 0.00 0.00 43.83 24.56 4.96 0.00 29.52 14.31 19.27 Office equipment

4.75% 0.68 0.00 0.00 0.68 0.22 0.03 0.00 0.25 0.43 0.46

Computers 16.21% 11.82 2.67 0.00 14.49 10.12 2.13 0.00 12.25 2.24 1.70 Total 433.73 69.60 0.72 502.61 92.27 27.09 0.05 119.31 383.30 341.46 Previous year 364.65 8.02 0.00 372.67 52.60 20.75 0.00 73.35 0.00 299.32


Note 27 Disclosure Regarding Derivative Instruments and Unhedged Foreign Currency Exposure

The outstanding foreign currency derivative contracts as at 31st March, 2014 in respect of various types of derivative hedge instruments and nature of risk being hedged are as follows

Nature: Buyers Credit for Import of Material (Amount In Lacs)

Forward Contracts Amount in Foreign Currency As at 31 March, 2014

Equivalent Indian Rupees As at 31 March, 2014

Amount in Foreign Currency As at 31 March, 2013


USD/INR 9.58 575.77 NIL NIL


Unhedged Amount in Foreign Currency As at 31 March, 2014




USD/INR 8.18 491.72 7.75 465.90

Note 28 Contingent Liabilities and Commitments (Rs in Lacs)

Particulars For the year ended 31 March, 2014


In respect of SBLCs issued in favour of WOS (Amount outstanding at the close of the year) 1803.00 NIL

Total 1803.00 NIL Note 29 Related Party Transaction As per the Accounting Standard 18, disclosures of transactions with related parties (As identified by the Management), as defined in Accounting Standard are given below:

a) Subsidiary Company Kushal Impex Pte. Ltd. Singapore

b) Associates with whom transactions done during the Year 1) Ashapura Paper Mills Pvt. Ltd.

c) Key Managerial Personnel

1) Sandeep Agrawal (CMD)

2) Mahendra Agrawal (WTD)

3) CA Vimal Shah (Chief Financial Officer)


d) Relatives of Key Managerial Personnel with whom transactions done during the Year 1) Manoj Agrawal

2) Sudha Agrawal

3) Tulsiram Agrawal

(Rs. In Lacs) Sr. No Nature of Transaction Name of Related Party For the year ended

31 March, 2014 For the year ended 31 March, 2013

1 Sale of Goods Ashapura Paper Mills Pvt. Ltd. 2836.89 3786.722 Purchase of Goods Ashapura Paper Mills Pvt. Ltd. 5964.94 3975.553 Rent Sudha Agrawal

Manoj Agrawal 5.40 4.98

5.404.98

4 Remuneration Sandeep AgrawalMahendra Agrawal

13.98 13.70

18.0022.00

5 Investment in Shares/Share Application Money

Kushal Impex Pte. Ltd. (WOS) 31.10 NIL

6 Guarantee for SBLC Kushal Impex Pte. Ltd. (WOS) 1803.00 NIL7 Expenses paid on

reimbursement basis Kushal Impex Pte. Ltd. (WOS) 113.38 NIL

8 Salary Tulsiram AgrawalVimal Shah

9.00 4.31

6.751.44

9 Interest on Unsecured Loans

Relatives of Key Managerial Personnel

NIL 14.31

Note 30 Prior Period Items

(Rs. InLacs) Particulars For the Year ended 31st

March,2014 For the Year ended 31st

March,2013 Provision for Gratuity (Expense) 13.16 NILTotal 13.16 NIL Note 31 Other Statutory Disclosures

Particulars For the Year ended 31stMarch,2014

For the Year ended 31stMarch,2013

Value of Imports on CIF Basis‐ Traded Goods 9244610 USD 5411067 USD

Expenditure in Foreign Currency NIL NILEarning in Foreign Exchange‐ Export of Goods on FOB Basis NIL NIL


Note 32 As per the Accounting Standard 21 on “Consolidated Financial Statements” as specified in the Companies (Accounting Standard) Rules 2006 (as amended), the company has presented consolidated financial statements separately. Note 33 The Ministry of Corporate Affairs, Government of India vide its General Circular No: 2/2011 dated 8Th February, 2011 has granted general exemption to the Holding Companies from attaching balance sheet of subsidiary companies with the balance sheet of the Holding Company as per section 212(8) of the Companies Act, 1956 subject to fulfillment of certain conditions. Accordingly the Board of Directors of the company has passed the resolution giving consent for not attaching the balance sheet of the subsidiary company with that of the company. Note 34 Previous year’s figure have been recast, regrouped and rearranged, wherever necessary to confirm to this year’s classification. For P. DOSHI & ASSOCIATES For and on behalf of the Board of Chartered Accountants KUSHAL TRADELINK LIMITED CA PARTHIV DOSHI SANDEEP AGRAWAL MAHENDRA AGRAWAL Proprietor Managing Director Whole Time Director M. No : 032295 FRN NO:102740W Date : May 1, 2014 CS Khushboo Surana CA Vimal Shah Place: Ahmedabad Company Secretary Chief Financial Officer Date: May 1, 2014 Place: Ahmedabad


Independent Auditor’s Report

To The Board of Directors Kushal Tradelink Limited Report on the Financial Statements

We have audited the accompanying consolidated financial statements of M/s. KUSHAL TRADELINK LIMITED, AHMEDABAD and its subsidiary which comprise the Consolidated Balance Sheet as at March 31, 2014 , the Consolidated Statement of Profit and Loss and the Consolidated Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management’s Responsibility for the Consolidated Financial Statements

The Company’s Management is responsible for the preparation of these consolidated financial statements that give a true and fair view of the consolidated financial position, consolidated financial performance and consolidated cash flows of the Company in accordance with the Accounting Standards referred to in sub‐section (3C) of section 211 of the Companies Act, 1956 (“the Act”). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the consolidated financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with the ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control relevant to the Company’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the consolidated financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Consolidated Balance Sheet, of the state of affairs of the Company as at March 31, 2014

(b) in the case of the Consolidated Statement of Profit and Loss, of the profit of the Company for the year ended on that date, and


(c) in the case of the Consolidated Cash Flow Statement, of the cash flows of the Company for the year ended on that date

Other Matters

a) The subsidiary companies considered in consolidated financial statements comprises of :

i) Kushal Impex Pte. Ltd. (Singapore)(Wholly Owned Foreign Subsidiary)

This company was incorporated on 16/01/2014 under the Singaporean Company Law. Pursuant to the applicable provisions of said law the first financial year of this company shall end on 31/03/2015 and hence the financial statement has been drawn up to 31/03/2014 for consolidation purpose by the Board of Directors and the same has been adopted by the management of Kushal Tradelink Ltd.

b) We have not audited the financial statements of Wholly Owned Foreign Subsidiary whose financial statements reflect total assets (net) of Rs. 2218.99 Lacs as at March 31, 2014, total revenues of Rs. 201.57 Lacs and net cash flow from operations of Rs. 2.97 Lacs for the period then ended. These unaudited financial statements have been approved by the respective Board of Directors and have been furnished to us by the Management which we have relied upon and our opinion is based solely on such approved unaudited financial statements.

c) As there were no Subsidiary/Associates/JVs during comparable period of earlier year, the comparable data for previous year have not been reported.



Consolidated Balance Sheet as at 31st March, 2014 (Rs. In Lacs)

Particulars Notes As at 31 March, 2014 A EQUITY AND LIABILITIES

1 Shareholders’ Funds (a) Share Capital 3 2,372.67 (b) Reserves and Surplus 4 2984.30 2

Noncurrent liabilities

5356.97

(c) Long Term Borrowings (d) Long Term Provisions

5 6

NIL 13.16

(b) Deferred Tax Liabilities (net) 7 14.39 27.55 3 Current liabilities (a) Short Term Borrowings 8 8,948.80 (b) Trade Payables 9 835.86 (c) Other Current Liabilities 10 602.66 (d) Short Term Provisions 11 225.00 10612.32 TOTAL 15996.84 B ASSETS

1 Noncurrent assets (a) Fixed Assets Tangible assets 12 383.30 (b) Non Current Investment 13 258.75 (c) Long Term Loans & Advances 14 510.73 (d) Other Non Current Assets 15 80.41 1233.19 2 Current assets (a) Inventories 16 913.12 (b) Trade Receivables 17 10,345.02 (c) Cash and Bank Balance 18 794.02 (d) Short Term Loans and Advances 19 2,711.49 14763.65 TOTAL 15996.84 Significant Accounting Policies 2

The accompanying Notes are an integral part of the Financial Statements For P. DOSHI & ASSOCIATES For and on behalf of the Board of Chartered Accountants KUSHAL TRADELINK LIMITED FRN NO:102740W CA PARTHIV DOSHI SANDEEP AGRAWAL MAHENDRA AGRAWAL Proprietor Managing Director Whole Time Director M. No : 032295 Date : May 1, 2014 CS Khushboo Surana CA Vimal Shah Place: Ahmedabad Company Secretary Chief Financial Officer Date: May 1, 2014 Place: Ahmedabad


Consolidated Statement of Profit and Loss for the Year Ended 31 March 2014

(Rs. In Lacs) Particulars Notes For the year ended

31 March, 2014 A CONTINUING OPERATIONS 1 Revenue From Operations 20 30251.85 2 Other Income 21 31.88 3 Total Revenue 30283.73 4 Expenses (a) Purchases of Traded Goods 22 27989.05 (b) Changes in Inventories of Traded Goods 23 (148.66) (c) Employee Benefits Expenses 24 149.61 (d) Finance Costs 25 992.47 (e) Depreciation and Amortization Expenses 12 27.09 (f) Other Expenses 26 605.13 Total Expenses 29614.69 5 Profit / (Loss) Before Exceptional and Extraordinary Items and Tax

(3 4) 669.04

6 Exceptional Items NIL 7 Profit/(Loss) Before Extraordinary Items & Tax (5 + 6) 669.04 8 Extraordinary Items NIL 9 Profit / (Loss) Before Tax (7 + 8) 669.04 10 Tax expense: (a) Current Tax Expense for Current Year (Tax Provisions) 225.00 (b) Current Tax Expense relating to Prior Years (1.65) (c) Net Current Tax Expense 223.35 (d) Deferred Tax Provision 6 (3.08) Total Tax Expense 220.27

11 Profit/(Loss) from Continuing Operations (9 +10) 448.77

12 Earnings Per Share (of 10/ each): (a) Basic & Diluted (i) Continuing Operations 2.20 (ii) Total Operations 2.20 Significant Accounting Policies 2

For P. DOSHI & ASSOCIATES For and on behalf of the Board of Chartered Accountants KUSHAL TRADELINK LIMITED FRN NO:102740W CA PARTHIV DOSHI SANDEEP AGRAWAL MAHENDRA AGRAWAL Proprietor Managing Director Whole Time Director M. No : 032295 Date : May 1, 2014 CS Khushboo Surana CA Vimal Shah Place: Ahmedabad Company Secretary Chief Financial Officer Date: May 1, 2014 Place: Ahmedabad


Consolidated Cash Flow Statement for the Year Ended 31st March 2014 (Rs. In Lacs)

Particulars For the Year ended on 31 March,2014

Cash Flows from Operating Activities Net Profit Before Taxation 669.04 Adjustment for : Depreciation 27.09 Interest Expenses 992.49 Profit / Loss on Sale of Fixed Assets / Investments 0.44 Operating Profit Before Working Capital Changes 1689.06

Changes in Current Assets (excl. Cash and Bank Bal.) (6291.23) Change in Debtors (3357.23) Change in Inventories(Stock‐in‐Trade) (148.66) Change in Other Current Assets (2758.34) Changes in Current Liabilities( excl. Dividend) 4525.58 Change in Creditors (822.13) Change in Bank Borrowings 4759.40 Change in Other Current Liabilities 588.31 Cash Generated from Operations (76.59) Income Tax (excl. Deferred Tax) 223.35 Cash from Operations Before Extraordinary Items (299.94) Extraordinary Items 0.00 Net Cash from Operating Activities ( 1 ) (299.94) Cash Flows from Investing Activities Purchase / Sale of Fixed Assets (69.36) Change in Non Current assets (596.96) Net Cash (Used)/Generated in/from Investing Activities ( 2 ) (666.32)


Cash Flows from Financing activities

Interest Expenses (992.49) Increase / Decrease in Share Capital 792.80 Change in Securities Premium 1982.00 Foreign Currency Fluctuation Reserve 3.64 IPO Expenses/ Preliminary Exps (40.66) Change in Other Short/Long Term Debts (775.00) Net Cash from (Used)/Generated in/from Financing Activities ( 3 ) 970.29 Net Increase in Cash & Cash Equivalents ( 4 )=( 1 ) + ( 2 )+( 3 ) 4.03 Cash & Cash Equivalents at Beginning of the Year (5) 12.12 Cash & Cash Equivalents as at 31st Mar, 2014(4 )+(5) 16.15 For P. DOSHI & ASSOCIATES For and on behalf of the Board of Chartered Accountants KUSHAL TRADELINK LIMITED FRN NO:102740W CA PARTHIV DOSHI SANDEEP AGRAWAL MAHENDRA AGRAWAL Proprietor Managing Director Whole Time Director M. No : 032295 Date : May 1, 2014 CS Khushboo Surana CA Vimal Shah Place: Ahmedabad Company Secretary Chief Financial officer Date: May 1, 2014 Place: Ahmedabad


Notes forming part of the Consolidated Financial Statements for the year ended 31st March, 2014

1. Corporate Information Kushal Tradelink Limited (KTL) is a Public Company domiciled in India incorporated under Companies Act, 1956. The company along with its WOS (Kushal Group) is engaged in the business of trading of various kind of paper, paper waste and other merchandise.

2. Summary of Significant Accounting Policies

a) Principles of Consolidation:

a) The consolidated financial statements have been prepared in accordance with Accounting Standard 21 (AS 21) on “Consolidated Financial Statements” as specified in the Companies (Accounting Standard) Rules, 2006 and on the basis of stand alone audited financial statements of Kushal Tradelink Limited and its Wholly Owned Subsidiary viz. Kushal Impex Pte. Ltd. (Singapore). Reference in the notes to “Group” shall mean to include KTL and its WOS consolidated in these financial statements unless otherwise stated.

b) The consolidated financial statements have been prepared on the following basis :

i) The financials statements of the company and its subsidiary are combined on a line‐by‐line basis by adding together the book value of like items of assets, liabilities, income and expenses, after fully eliminating intra‐group balances and intra‐group transactions resulting in unrealized profits or losses in accordance with Accounting Standard 21 (AS 21) on “Consolidated Financial Statements” as specified in the Companies (Accounting Standard) Rules, 2006.

ii) The difference (if any) between the cost of investment in the Subsidiary over the net assets at the time of acquisition of the investment in subsidiary is recognized in the financial statements as Goodwill or Capital Reserve as the case may be.

iii) The Minority Interest’s (if any) share of net profit of consolidated subsidiary for the year is identified and adjusted against the income of the group in order to arrive at the net income attributable to shareholders of the company.

iv) The Minority Interest’s (if any) share of net assets of consolidated subsidiary is identified and presented in the consolidated balance sheet separate from liabilities and the equity of the company’s shareholders.

v) Investments made by the parent company in Subsidiary Company subsequent to the holding‐subsidiary relationship coming into existence are eliminated while preparing the consolidated financial statements.

viii) Translation of the financial statements of non integral foreign subsidiary for incorporation in the consolidated financial statements have been done using the following exchange rate :

a) Assets and liabilities have been translated by using the rates prevailing as on the date of balance sheet.

b) Income and expense items have been translated by using the rate of exchange prevailing on the date of transaction in view of the lesser number of transactions in subsidiary.


c) Exchange difference arising on translation of financial statements of non integral operations as specified above is recognized in the Foreign Currency Translation Reserve until the disposal of net investment.

ix) As far as possible, the consolidated financial statements are prepared using uniform accounting policies for like transactions and other events in similar circumstances and necessary adjustments required for deviation if any have been made in the consolidated financial statements.

b) Basis of Preparation of Financial Statement

The Financial Statements of the company have been prepared and presented in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) under the historical cost convention on an accrual basis. The company has prepared these financial statements to comply in all material respects with the Accounting Standards notified under the Companies (Accounting Standard) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The accounting policies adopted in the preparation of the financial statements are consistent with those of previous year.

Most of the accounting policies of the Reporting Company and those of its Subsidiary are similar. However, since WOS based in Singapore function in different regulatory environments, certain accounting policies may differ. The accounting policies of all the Companies are in line with Generally Accepted Accounting Principle.

c) Use of Estimates

The preparation of the financial statements in conformity with Indian GAAP requires the management to make judgment, estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent liabilities on the date of financial statements and reported amounts of revenues and expenses for the year. Although these estimates are based on Management’s best knowledge of current events and actions, uncertainty about these assumptions and estimates could result in the outcomes different from the estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Any revision to accounting estimates is recognized prospectively in the current and future periods.

d) Current & NonCurrent Classification

All the assets and liabilities have been classified as current or non‐current as per the company’s normal operating cycle and other criteria set out in Revised Schedule VI to the companies act, 1956. Based on the nature of activities and time between the activities performed and their subsequent realization in cash or cash equivalents, the company has ascertained its operating cycle as 12 months for the purpose of current/ non –current classification of assets and liabilities.

e) Inventories

Inventories(Stock‐In‐Trade) are valued at lower of Cost or Net Realisable Value by following FIFO Method.


f) Cash Flow Statement

i) Cash & cash Equivalents (for purpose of cash flow statement)

Cash comprises cash on hand and demand deposit with banks. Cash Equivalents are short‐term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

ii) Cash Flow Statement

Cash flows are reported using the indirect method, whereby profit/ (loss) before extraordinary items and tax is adjusted for the effects of transactions of non‐cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, financing and investing activities of the company are segregated.

g) Prior Period and Exceptional items

i) All identifiable items of income and expenditure pertaining to prior period are accounted through “ Prior Period items”.

ii) Exceptional items are generally non‐recurring items of income and expense within profit or loss from ordinary activities, which are of such size, nature or incidence that their disclosure is relevant to explain the performance of the Company for the year.

h) Depreciation

Depreciation on fixed Assets is provided on straight‐ line method at rates and in the manner specified in Schedule XIV to the Companies Act, 1956 read with the relevant circulars issued by the Ministry of Corporate Affairs.

i) Revenue Recognition:

Revenue is recognised when consideration can be reasonably measured and there exists reasonable certainty of its recovery.

i) Sales of Goods are recognised when the significant risk and rewards of ownership of the goods have been passed to the customer and net of Value added tax and return.

ii) Other Incomes are recognised on receipt of confirmation regarding acceptance of claim form the counterpart or when it is a part of oral expressed understanding.

iii) Interest Income is recognised on time proportion basis taking into account the amount outstanding and the rate applicable.

j) Fixed Assets

Tangible fixed assets.

Fixed assets are stated at cost of acquisition or construction. They are stated at historical cost less accumulated depreciation and Impairment losses, if any. Cost comprises the purchase price, import duty and other non‐ refundable taxes or levies and any directly attributable cost of bringing the asset to its working condition for its intended use. Borrowing cost relating to acquisition /construction of fixed assets which take substantial period


time to get ready for its intended use are also included to the extent they relate to the period till such assets are ready to be put to use.

k) Foreign Currency Transactions

i) Initial Recognition and measurement

Foreign currency transaction is recorded, on initial recognition in the reporting currency by applying to the foreign currency amount at the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

ii) Subsequent Measurement

Foreign currency receivables, payables and investments in subsidiary (monetary items) are subsequently measured as stated below:

At the year‐ end, monetary items denominated in foreign currencies, other than those covered by forward contracts are converted into rupee equivalents at the year‐ end exchange rates

iii) Exchange Differences

All exchange differences arising on settlement and conversion of foreign currency transaction are included in the Statement of Profit and loss.

iv) Forward Exchange Contracts.

The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and forecasted transactions.

The use of such foreign currency forward contracts is governed by the company’s policies approved by the management, which provide principles on use of such financial derivatives consistent with the company’s risk management strategy. The company does not use derivative financial statements for speculative purposes.

In respect of transactions covered by forward exchange contracts, the difference between the year‐ end rate and the exchange rate at the date of contract is recognised as exchange difference and the premium paid on forward contracts is recognised over the life of the contracts.

l) Investments

i). Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long term investments.

ii) Long term investments are stated at cost. Provisions for diminution in the value of long term investments are made only if such a decline is other temporary in the opinion of the management.

m) Employee Benefits

Short term Employee Benefits

Short term employees are recognised as an expense at the undiscounted amount in the Statement of Profit and loss of the year in which the related services is rendered.


Post Employment Benefits

i) Defined Contribution Plans

The Company’s State governed Provident Fund Scheme, Employee State Insurance Scheme and Labour Welfare Fund Scheme are considered as defined contribution plans. The contribution under the schemes is recognised as an expense in the Statement of Profit and loss, as they are incurred. These are no other obligations other than the contribution payable to the respective funds

ii) The company makes payment for earned leave on year to year basis and accordingly the same is recognised as an expense on year to year basis.

iii) Till last year, the company did not make any provisions for Gratuity. However the same has been recognised as an expense on the basis of age and length of service of employees of the company, the track record of employee turnover, the retirement age and by applying appropriate discount factor.

n) Borrowing costs

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to Statement of Profit and loss.

o) Segment Accounting

Based on guiding principles given in Accounting Standard on “ Segment Reporting”‐ AS 17 as specified in the companies (Accounting Standard) rules, 2006 (as amended) , single financial report contains both Standalone financial statement and consolidated financial statement of the company. Hence, the required segment information has been appended in the Consolidated Financial Statement (CFS).

p) Related Party transactions

Disclosure of transactions with related parties, as required by Accounting Standard 18 “Related Party Disclosure” as specified in the Companies (Accounting Standard) Rules, 2006 (as amended), has been set out in a separate statement annexed to this note. Related parties as defined under clause 3 of the Accounting Standard 18 have been identified on the basis of representation made by the management and information available with the company.

q) Leases

Lease arrangement where risk and rewards incidental to ownership of an asset substantially vest with the Lessor are recognized as Operating Leases. The Company’s significant Leasing arrangement are in respect of operating leases for immovable property which includes residential premises, office, godowns, etc. The aggregate lease rentals payable/receivables are recognized as expenditure/income in the statement of profit and loss as per the respective lease agreements.

r) Earning Per Share

The company reports basic and diluted earnings per share (EPS) in accordance with the Accounting Standard 20 as specified in the Companies (Accounting Standard )Rules,2006 (as amended). The Basic EPS has been computed by dividing the income available to equity shareholders by the weighted average number of equity shares outstanding during the accounting year. There are no dilutive potential equity shares so Diluted EPS.


s) Provision for Tax

Tax expenses comprises of current tax and deferred tax.

1) Current Tax Provision for taxation has been made in accordance with the direct tax laws prevailing for the relevant assessment years. 2)Deferred Tax

In accordance with the Accounting Standard 22‐ Accounting for Taxes on Income, as specified in the Companies (Accounting Standard) Rules 2006 (as amended), the deferred tax for timing differences between the book and tax profits for the year is accounted for by using the tax rates and Laws that have been enacted or substantively enacted as of the Balance Sheet Date.

Deferred tax assets arising from timing differences are recognised to the extent there is virtual certainty that the assets can be realized in future.

Net outstanding balance in Deferred Tax account is recognized as deferred tax liability /asset. The deferred tax account is used solely for reversing timing difference as and when crystallized.

t) Impairment of Fixed Assets

1) The carrying amount of assets, other than inventories, is reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the assets recoverable amount is estimated.

2) The impairment loss is recognized whenever the carrying amount of an asset or its cash generation unit exceeds its recoverable amount. The recoverable amount is the greater of the asset’s net selling price and value in the uses which is determined based on the estimated future cash flow discounted to their present values. All impairment losses are recognized in the statement of Profit and Loss.

3) An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount and is recognised in the Statement of Profit and Loss.

u) Provision, Contingent Liabilities and Contingent Assets

Provision are recognized for when the company has at present, legal or contractual obligation as a result of Past events, Only if it is probable that an outflow of resources embodying economic outgo or loss will be required and if the amount involved can be measured reliably.

Contingent liabilities being a possible obligation as a result of Past events, the existence of which will be confirmed only by the occurrence or non occurrence of one or more future events not wholly in control of the company are not recognized in the accounts. The nature of such liabilities and an estimate of its financial effect are disclosed in notes to the Financial Statements.

Contingent assets are neither recognized nor disclosed in the financial statements.

v) Expenditure

Expenses are net of taxes recoverable , where applicable.


w) Accounting of claims

i). Claims received are accounted at the time of lodgment depending on the certainty of receipt and claims payable are accounted at the time of acceptance.

ii). Claims raised by Government authorities regarding taxes and duties, which are disputed by the company, are accounted based on legality of each claim. Adjustments, if any, are made in the year in which disputes are finally settled.

x). Doubtful debts. Advances

Provision is made in the accounts for debts/ Advances which in the opinion of the management are considered doubtful of recovery.


Notes on the Financial Statements for the Year Ended on 31st March 2014

Note 3 Share Capital (Rs. In Lacs)

Particulars As at 31 March, 2014 Number of shares Amount

(a) Authorised Equity Shares of Rs. 10 each with Voting Rights 25000000 2500.00 (b) Issued , Subscribed and Paid Up Equity Shares of Rs. 10 each with Voting Rights 23726661 2372.67

Total 23726661 2372.67

(a) Reconciliation of the number of shares and amount outstanding at the beginning and at the end of the reporting period:

Particulars Opening Balance

Buy back Issued During the Year*

Closing Balance

Equity Shares with Voting Rights Year ended 31 March, 2014 ‐ Number of Shares 15798661 NIL 7928000 23726661‐ Amount (Rs. in Lacs) 1579.87 NIL 792.80 2372.67

Year ended 31 March, 2013 ‐ Number of Shares 15798661 NIL NIL 15798661‐ Amount (Rs. In Lacs) 1579.87 NIL NIL 1579.87

* During the year the company came up with an IPO of 7928000 Equity Shares of Rs. 10 each (fully paid up), pursuant to which 7928000 Equity Shares were allotted to the Subscribers of IPO.

(b) Terms/rights attached to Equity Shares:

The Company has only one class of shares referred to as equity shares having Face Value of Rs. 10/‐ per share. Each holder of Equity Share is entitled to one Vote per Share.

(c ) Aggregate Number of Bonus Shares Issued, Shares Issue for Consideration Other Than Cash and Shared Bought Back During the Period of Five Years immediately preceding the Reporting Date

Particulars As at 31st March, 2014Equity Shares issued as fully paid Bonus Shares by Capitalisation of Securities Premium

7021629

Total 7021629


(d) Details of shareholders holding more than 5% Shares in the Company

Class of Shares / Name of Shareholder As at 31 March, 2014 Number of Shares held

% Holding in that Class of Shares

Equity shares with voting rights Sandeep T. Agrawal 1352340 5.70% Manoj T. Agrawal 2054160 8.66% Mahendra T. Agrawal 2270160 9.57% Sangita M. Agrawal 855360 3.61% Namrata S. Agrawal 4622465 19.48% Pushpa T. Agrawal 2160022 9.10% Tulsiram C. Agrawal 2484000 10.47%

Total 15798507 66.59% Note 4 Reserves and Surplus


2014

(a) Securities Premium

Opening Balance NIL Add : Premium on Equity Shares Issued during the Year 1982.00 Closing Balance 1982.00

(b) Surplus / (Deficit) in Statement of Profit and Loss

Opening balance 548.81 Add: Profit / (Loss) for the Year 448.77 Closing Balance 997.58

(c) General Reserve

Opening Balance 1.08 Add: Addition during the Year NIL Closing balance

(d)Foreign Currency Fluctuation Reserve Opening Balance Add: Addition during the Year Closing Balance

1.08

0.00 3.64 3.64

Total 2984.30


Note 5 Long Term Borrowings

(Rs. In Lacs) Particulars As at 31 March, 2014

Non current Current (a) Loans and Advances from Related Parties

Unsecured NIL NIL Total NIL NIL(b)Other Loans and Advances (Unsecured) NIL NIL

Total NIL NIL Note 6 Long Term Provisions


2014

Provision for Gratuity 13.16

Total 13.16

Note 7 Deferred Tax Liabilities (Net) (Rs. In Lacs)


Deferred Tax Liabilities

Tax effect of items constituting Deferred Tax Liability Depreciation 18.46

Tax effect of items constituting Deferred Tax Liability(A) 18.46

Tax effect of items constituting deferred tax assets

Gratuity 4.07

Tax effect of items constituting Deferred Tax Assets(B) 4.07 Net deferred Tax Liability (AB) 14.39 Note 8 Short Term Borrowings

(Rs. In Lacs)


From Banks

Cash Credit/OD Facilities‐ Secured (Refer Note below)

7882.36

Buyer's Credit Facilities‐ Secured (Refer Note below) 1066.44

Total 8948.80


Note: The said credit facilities are secured by pledge of FDRs/SBLCs and pari passu charge by way of hypothecation on all the current assets of the company amongst the bankers. Further, the said Facilities are also secured by first and pari passu charge by way of EQM on some of the fixed assets of the company and some immovable properties owned by Executive Directors and their relatives as collateral. Also all the facilities are secured by the Personal Guarantee of the Executive Directors and their relatives.

Note 9 Trade Payables


Acceptances NIL Other than Acceptances* 835.86

Total 835.86

*Disclosures required u/s 22 of MSMED Act, 2006: There are no Overdue Principal remaining unpaid to any supplier. Further, there are no interest paid/ accrued/ due to any such supplier. 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. This has been relied upon by the auditors. Note 10 Other Current Liabilities

(Rs. In Lacs) Particulars As at 31 March, 2014 Statutory Dues 6.65 Payable for Expenses 6.57 Advances from Customers 4.23 Amount Payable to Bank (Forward Contract) 585.21

Total 602.66 *This is Non Trade Investment comprising of 84894 Quoted Shares of Shree Rama Multi Tech Ltd. Having Market Value of Rs. 2.93 per Share [MV 2.49 Lacs (PY 3.81 Lacs)]. Notes 11 Short Term Provision


2014 Provision for Income Tax 225.00

Total 225.00


Note 13 Non Current Investments (Rs. In Lacs)

Particulars As at 31 March, 2014 Quoted Unquoted Total

Investment in Quoted Shares ( At Cost ) * 15.13 NIL 15.13 Investment Properties NIL 243.62 243.62

Total 15.13 243.62 258.75 Note 14 Long Term Loans and Advances


(a) Security Deposits (Unsecured, Considered Good) 29.37

(b) Other Advances Advance for Fixed Assets 481.36

Total 510.73 Note 15 Other Non Current Assets


Unamortised Preliminary Expenses 80.41

Total 80.41 Note 16 Inventories


Stock in Trade (Incl. Stock in Transit) 913.12 Total 913.12

Note 17 Trade receivables


Trade receivables outstanding for a period exceeding six months from the date they were due for payment

Unsecured, considered good 221.72 Trade receivables outstanding for a period less than six months from the date they were due for payment

Unsecured, considered good 10123.30

Total 10345.02


Note 18 Cash and Bank Balance (Rs. In Lacs)


Cash and Cash Equivalents Cash on hand 3.77 Balances with banks in Current Accounts 12.38

16.15

Other Bank Balances Margin Money (for LC/Buyers Credit/SBLC) 365.00 Other bank Deposits (Pledged with Banks as Collaterals) 400.42 Interest Accrued but Not Due 12.45 777.87

Total 794.02

Note 19 Short Term Loans and Advances (Rs. In Lacs)


Prepaid Expenses 133.37 Balances with Tax Authorities 239.24 Advance to Suppliers 1763.11 Foreign Currency Receivable (Forward Contract) 575.77

Total 2711.49

Note 20 Revenue from Operations (Rs. In Lacs)


(a) Sale of Products (Refer Note (i) below) 30144.60 (b) Other Operating Income (Refer Note (ii) below) 107.26 Total 30251.85

Note 20(i)


Various kind of Paper (Net of VAT) 30144.60 Total Sale of traded goods 30144.60


Note 20(ii)


Other Operating Income comprises: Claim from/to Suppliers/Customers (net) 10.09 Rate Differences/Discount/Interest on Delay Payment 46.52 Recoveries from Customers towards various Charges 34.43 Import Claims 13.73 Round off 0.06 Other Income 2.43 Total 107.26

Note 21 Other Income (Rs. In Lacs)


Interest on FDRs 32.32

Net Gain/(Loss) on Sale of Fixed Assets (0.44)

Total 31.88

Note 22 Purchase of Traded goods (Rs. In Lacs)


Various Kind of Papers 27989.05

Total 27989.05

Note 23 Changes in Inventories of Traded Goods

(Rs. In Lacs) Particulars For the year ended

31 March, 2014

Inventories at the beginning of the Year: Traded Goods 764.46 764.46Inventories at the end of the Year: Traded Goods 913.12

913.12

Net (Increase) / Decrease (148.66)


Note 24 Employee Benefits Expense (Rs. In Lacs)


Salaries and Bonus 99.62 Managerial Remuneration 24.00 Contributions to Provident Fund 8.91 ESIC Expense 1.18 Gratuity (Current Period) 1.06 Gratuity (Prior Period) 12.10 Staff Welfare Expenses 2.74

Total 149.61 Note 25 Finance Costs

(Rs. In Lacs) Particulars For the year ended

31 March, 2014

(a) Interest Expense on: (i) Borrowings 691.93(ii) Others

‐ Interest on Unsecured loan NIL‐ Other Interest 0.02

(b) Other Borrowing Costs (Refer note below) 163.75 (c) Net (gain) / Loss on Foreign Currency Transactions and Translation (considered as Finance Cost) 136.77

Total 992.47

Note 25 (i) Other Borrowing Cost (Rs. In Lacs)

Particulars


Amt.Rs Bank charges 57.20Bank Loan Process Fees 37.98Loan franking exp 19.21Other Finance Charges 48.04Forward Premium 1.33

TOTAL 163.75


Note 12 Fixed Assets

(Rs. In Lacs)

Tangible assets Gross Block Accumulated Depreciation and Impairment Net Block Balance

as at 1 April, 2013

Additions Disposals Balance as at 31

March, 2014

Balance as at 1 April, 2013

Depreciation /

Amortisation Expense for the Year

Eliminated on Disposal of Assets

Balance as at 31

March, 2014

Balance as at 31

March, 2014

Balance as at 31

March, 2013

Land

135.23 0.00 0.00 135.23 0.00 0.00 0.00 0.00 135.23 135.23

Buildings 1.63% 23.20 5.09 0.00 28.29 2.40 0.41 0.00 2.81 25.48 20.80

Plant and Equipment 4.75%

31.38 52.78 0.72 83.44 5.28 1.64 0.05 6.88 76.56 26.10

Furniture and Fixtures 6.33%

12.10 0.00 0.00 12.10 5.05 0.77 0.00 5.82 6.28 7.05

Vehicles 9.50% 175.49 9.07 0.00 184.56 44.63 17.15 0.00 61.78 122.77 130.86 Vehicles 11.31% 43.83 0.00 0.00 43.83 24.56 4.96 0.00 29.52 14.31 19.27 Office equipment

4.75% 0.68 0.00 0.00 0.68 0.22 0.03 0.00 0.25 0.43 0.46

Computers 16.21% 11.82 2.67 0.00 14.49 10.12 2.13 0.00 12.25 2.24 1.70 Total 433.73 69.60 0.72 502.61 92.27 27.09 0.05 119.31 383.30 341.46 Previous year 364.65 8.02 0.00 372.67 52.60 20.75 0.00 73.35 0.00 299.32


Note 26 Other expenses (Rs. In Lacs)


Amt.Rs Insurance Premium 6.75Audit Fees (Statuary Audit & Tax Audit) 1.40Electricity Expense 9.10Foreign Exchange Losses(To the extent Not considered as Finance cost) 467.76Municipal Expense 1.75Repairs & Maintenance 1.17Vehicle Repair & Fuel Expenses 38.27Rent Expenses 10.38Miscellaneous Expenses 68.55

Total 605.13

Note 27 Disclosure Regarding Derivative Instruments and Unhedged Foreign Currency Exposure

(a) The outstanding foreign currency derivative contracts as at 31st March, 2014 in respect of various types of derivative hedge instruments and nature of risk being hedged are as follows:

Nature : Buyers Credit for Import of Material (Amount In Lacs)

Forward Contracts Amount in Foreign Currency As at 31 March, 2014




USD/INR 9.58 575.77 NIL NIL


Unhedged Amount in Foreign Currency As at 31 March, 2014




USD/INR 8.18 491.72 7.75 465.90

Note 28 Contingent Liabilities and Commitments: NIL

The WOS viz. Kushal Impex Pte Ltd.(Singapore) has availed LC/OD facilities from bankers on the security of SBLC issued in its favour. The said SBLCs have been arranged by the parent company (KTL) on the basis of security/guarantee given to Indian Bankers. In view of the same being SBLCs in favour of WOS the same has not been reported as contingent liability in consolidated financial statement.

Note 29 Related Party Transaction As per the Accounting Standard 18, disclosures of transactions with related parties (As identified by the Management), as defined in Accounting Standard are given below:

a) Associates with whom transactions done during the Year 1) Ashapura Paper Mills Pvt. Ltd.

b) Key Managerial Personnel


1) Sandeep Agrawal (CMD) 2) Mahendra Agrawal (WTD) 3) CA Vimal Shah (CFO)

c) Relatives of Key Managerial Personnel with whom transactions done during the Year 1) Manoj Agrawal 2) Sudha Agrawal 3) Tulsiram Agrawal

(Rs. In Lacs) Sr. No

Nature of Transaction Name of Related Party For the year ended

31 March, 2014

For the year ended

31 March, 2013 1 Sale of Goods Ashapura Paper Mills Pvt. Ltd. 2836.89 3786.722 Purchase of Goods Ashapura Paper Mills Pvt. Ltd. 5964.94 3975.553 Rent Sudha Agrawal

Manoj Agrawal 5.40 4.98

5.404.98

4 Remuneration Sandeep AgrawalMahendra Agrawal

13.98 13.70

18.0022.00

5 Salary Tulsiram AgrawalVimal Shah

9.00 4.31

6.751.44

6 Interest on Unsecured Loans

Relatives of Key Managerial Personnel

NIL 14.31

Note 30 Prior Period Item

(Rs. In Lacs) Particulars For the Year ended 31st March,2014

Provision for Gratuity (Expense) 13.16Total 13.16 Note 31 The Ministry of Corporate Affairs, Government of India vide its General Circular No: 2/2011 dated 8Th February, 2011 has granted general exemption to the Holding Companies from attaching balance sheet of subsidiary companies with the balance sheet of the Holding Company as per section 212(8) of the Companies Act, 1956 subject to fulfillment of certain conditions. Accordingly the Board of Directors of the company has passed the resolution giving consent for not attaching the balance sheet of the subsidiary company with that of the company. Note 32 Previous year’s figure have been recast, regrouped and rearranged, wherever necessary to confirm to this year’s classification. For P. DOSHI & ASSOCIATES For and on behalf of the Board of Chartered Accountants KUSHAL TRADELINK LIMITED CA PARTHIV DOSHI SANDEEP AGRAWAL MAHENDRA AGRAWAL Proprietor Managing Director Whole Time Director M. No : 032295 FRN NO:102740W Date : May 1, 2014 CS Khushboo Surana CA Vimal Shah Place: Ahmedabad Company Secretary Chief Financial Officer Date: May 1, 2014 Place: Ahmedabad


Appendix to Consolidated Financial Statement

Please refer Note 2(l) of Standalone Financial Statement.

Name of Subsidiary: Kushal Impex Pte Ltd. (Wholly Owned Subsidiary)*Reporting Currency SGDCountry SingaporeIssued, Subscribed and Paid Up Share Capital (incl. Share Application Money Pending Allotment)

Rs. 30.05 Lacs

Reserves & Surplus Rs. (21.06) LacsAssets Rs. 2218.99 LacsEquity and Liabilities Rs. 2202.42 LacsInvestments NILTotal Revenue Rs. 201.57 LacsPBT Rs. (21.06) LacsTax NILPAT Rs. (21.06) LacsProposed Dividend NIL *This company was incorporated on 16/01/2014 under the Singaporean Company Law. Pursuant to the applicable provisions of said law the first financial year of this company shall end on 31/03/2015 and hence the financial statement has been drawn up to 31/03/2014 for consolidation purpose by the Board of Directors and the same has been adopted by the management of Kushal Tradelink Ltd.

C I N : L51909GJ2000PLC037472 Plot No. 43, B/s. Navneet Prakashan Press B/h Govt 'G' Colony, Sukhramnagar, Gomtipur, A h m e d a b a d -380023 Phone: 22772991, Fax: 22782670 Email: [email protected] website: w w w . kushaltradelink . c o m

ATTENDANCE SLIP

NAME & ADDRESS OF SHAREHOLDER / PROXY: ______________________________________

I certify that I am a shareholder / proxy of the shareholder of the Company.

I/We hereby record my/our presence at the Fourteen Annual General Meeting of the Company held on Friday, 22nd August, 2014 at 11:00 am at “Kushal House”, Plot No. 43, B/s Navneet Prakashan Press, B/h. Govt 'G' Colony, Sukhramnagar, Gomtipur, Ahmedabad – 380023 Gujarat, India

___________________________________ Signature of Shareholder/Proxy

Note: Members are requested to bring their copies of Annual Report to the Meeting. PLEASE FILL IN ATTENDANCE SLIP AND HAND IT OVER AT THE ENTRANCE OF THE MEETING HALL.

DP Id.

Master Folio No.

Client Id.

C I N : L51909GJ2000PLC037472 Plot No. 43, B/s. Navneet Prakashan Press B/h Govt 'G' Colony, Sukhramnagar, Gomtipur, A h m e d a b a d -380023 Phone: 22772991, Fax: 22782670 Email: [email protected] website: w w w . kushaltradelink . c o m

PROXY FORM

I/We__________________________________________of______________________________being member/members of Kushal Tradelink Limited hereby appoint __________________ of____________________ or failing him/her _____________________ __ of _____________________ as my/our proxy to vote for me/us and on my/our behalf at the Fourteen Annual General Meeting of the Company to be held on Friday, 22nd August, 2014 at 11.00 A.M. at Plot No. 43, B/s Navneet Prakashan Press, B/h. Govt 'G' Colony, Sukhramnagar, Gomtipur, Ahmedabad – 380023 Gujarat, India or at any adjournment thereof.

Signed this ____________day of __________2014

________________________

Signature

INSTRUCTIONS: The proxy in order to be effective should be deposited duly stamped, completed and signed at the Registered Office of the Company not less than 48 hours before the time for holding the meeting or adjourned meeting. The Proxy need not be a member of the Company.

Note: Members are requested to bring their copies of Annual Report to the Meeting.

DP Id.

Master Folio No.

Client Id.

AFFIX REVENUE STAMP

--

Contact Details for Investors:Compliance OfficerPlot No. 43, B/s Navneet Prakashan PressB/h Govt 'G' Colony,Sukhramnagar, Gomtipur,Ahmedabad – 380023Tel No: +91-79-22772991M il id kh hb @k h lt d li kMail id: [email protected]

Documents

KUSHAL TRADELINK LIMITED ANNUAL REPORT 2013-2014CS. Khushboo Surana (Company Secretary and Compliance Officer) CA. Vimal Shah (Chief Financial Officer) Statutory Auditors: Registrar: