Your Directors hereby present the Twenty Seventh Annual Report together with the
Audited Accounts of the company for the financial year ended 31st March, 2017.


Financial summary or highlights/Performance of the Company:

The financial highlights for the current year in comparison to the previous year are as
under:


  

    

    

    
(Rupees in Lakhs)
  
  

    
PARTICULARS
    
Current Year
    
Previous Year
  
  

    

    
(2016-17)
    
(2015-16)
  
  

    
Total Revenue
    
6.55
    
4.90
  
  

    
Total Expenditure (before Financial
    

    

  
  

    
Charges, Depreciation and Taxation)
    
6.50
    
5.13
  
  

    
Profit before Financial Charges,
    

    

  
  

    
Depreciation and Taxation
    
0.05
    
-0.23
  
  

    
Less: Depreciation
    
0.00
    
0.00
  
  

    
Less: Financial Charges
    
0.00
    
0.00
  
  

    
Profit Before Tax
    
0.05
    
-0.23
  
  

    
Less: Provision for Tax & Deferred Tax
    
0.00
    
0.00
  
  

    
Profit After Tax
    
0.05
    
-0.23
  



COMPANY PERFORMANCE:

During the year company has not undertaken any major commercial operations profit/
(loss) after tax stood at Rs. 0.05 lacs.

There is no change in the nature of business during the FY 2016-17


DIVIDEND:

Your Directors do not recommend any dividend for the financial year 2016-2017, in view
of the accumulated losses.


TRANSFER TO RESERVES

Your Company did not transfer any amount to reserves


THE NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES, JOINT
VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR:

The Company doesn't have any subsidiaries/ associate companies and the Company does not
have any joint ventures.


STATUTORY AUDITORS:

Pursuant to the provisions of Sections 139(2) of the Companies Act, 2013 the
shareholders in their meeting held on 31st December, 2014 approved the
appointment of M/s. P.S. Nagaraju & Co, Chartered

Accountants, Hyderabad (ICAI Firm Registration No 0114477S), as the Statutory Auditors
of the Company to hold office till the conclusion of 29th Annual General
Meeting subject to ratification of shareholders in every Annual General Meeting.
Accordingly, a resolution seeking Members' ratification on appointment of M/s. P.S.
Nagaraju & Co, Chartered Accountants, Hyderabad, as the Statutory Auditors of the
Company for the financial year 2017-18 is included in Item No.3 of the Notice convening
the Annual General Meeting.


INTERNAL AUDITORS:

The operations of the company are almost insignificant. The company is also going
through severe financial crisis. In view of the same, the company has not appointed any
outside agency to carry out Internal Audit.


SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has
appointed M/s. P.S. Rao & Associates, a firm of Company Secretaries in Practice to
undertake the Secretarial Audit of the Company.

The Secretarial Audit Report is annexed herewith as "Annexure III" to
this report.


REPLY TO QUALIFICATIONS IN SECRETARIAL AUDIT REPORT:

i) Company has not appointed CFO and Company Secretary as required under section 203 of
Companies Act, 2013 and Regulation 6 of SEBI (Listing Obligation and Disclosure
Requirements) Regulation, 2015:

With negligible operations, becoming difficult for the Company to attract suitable CFO
and Company Secretary.


ii) The Company is irregular in filing various forms required to be filed under
provisions of Companies Act, 2013

Due to constant changes in officers looking after the secretarial matters, there have
been instances of delay in filing of forms.


iii) Non Appointment of Internal Auditor as required under section 138 of Companies
Act, 2013

The operations of the Company are negligible and company is facing financial crunch
thus becoming difficult to appoint internal auditor.


DIRECTORS :

In accordance with the provisions of Section 152 of the Companies Act, 2013, Smt. S.N
Lakshmi, Directorof the Company retires by rotation and being eligible, has offered
herself for re-appointment.

The details of various committees of the Board are given as Annexure - V and
forms part of this report.


MEETINGS OF BOARD OF DIRECTORS

During the Financial year ended 31st March, 2017, Board of Directors met (5)
Four times and gap between two Board meetings did not exceed 120 days.


  

    
28.05.2016
    
11.08.2016
    
14.11.2016
    
06.12.2016
    
14.02.2017
  



DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE RESIGNED
DURING THE YEAR:

During the Financial year under review, there were no changes in the Board of Directors
of the Company.


DECLARATION GIVEN BY INDEPENDENT DIRECTORS:

Every Independent Director, at the first meeting of the Board in which he participates
as a Director and thereafter at the first meeting of the Board in every financial year,
gives a declaration that he meets the criteria of independence as provided under the
Companies Act, 2013.


FIXED DEPOSITS:

Your Company has not accepted any fixed deposits and as such no principal or interest
was outstanding as on the date of the Balance sheet.


PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

Details of Loans, Guarantees and Investments covered under the provisions of Section
186 of the Companies Act, 2013 are given in the notes to the Financial Statements.


MATERIAL CHANGES AND COMMITMENTS:

There are no material changes and commitments affecting the financial position of the
company occurred between the end of the financial year of the company to which the
financial statements relate and the date of the report.


DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to Section 134 (5) of the Companies Act, 2013, your Directors confirm that to
the best of their knowledge and belief and according to the information and explanation
obtained by them,

(i) that in the preparation of Annual Accounts for the financial year ended 31st March,
2017, the applicable accounting standards have been followed along with the proper
explanation relating to material departures, if any, there from;

(ii) that the directors have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the company at the end of the
financial year and of the loss of the company for that period:

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

(iv) that the directors have prepared the annual accounts on a going concern basis.

(v) The Directors had laid down Internal Financial controls to be followed by the
Company and that such internal financial Controls are adequate and were operating
efficiently.

(vi) The Directors had devised proper systems to ensure compliance with the provisions
of all applicable laws and that such systems were adequate and Operating effectively.


VIGIL MECHANISM/ WHISTLE BLOWER POLICY:

The Company has a Whistle Blower Policy framed to deal with instance of fraud and
mismanagement, if any in the Group. The details of the Policy are explained in the section
Polices of the Company -"Annexure -VI'' and also posted on the website of the
Company http://verticalindustries.in/


RISK MANAGEMENT

The Company has risk management mechanism in place which mitigates the risk at
appropriate situations and there are no elements of risk, which in the opinion of Board of
Directors may threaten the existence of the Company.


CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

There were no contracts or arrangements with related parties as specified in section
188 (1) of the Act during the financial year 2016-17.


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

The details regarding Energy Conservation, Technology Absorption, Foreign Exchange
Earnings and Outgo as required by section 134(3) (m) of the Companies Act, 2013 read with
the Companies (Accounts) Rules, 2014 are given as "Annexure - I'' and forms
part of this report.


EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in form MGT-9 is annexed
herewith as "Annexure - II" to this report.


CORPORATE GOVERNANCE:

As per Securities Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations,2015, Provisions of Corporate Governance are not applicable to
your Company.


MANAGEMENT DISCUSSION & ANALYSIS:

Pursuant to the provisions of Regulation 34(2) (e) of the Securities and Exchange Board
of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, a report on
Management Discussion & Analysis is herewith annexed as 'Annexure VII' to this
report.


LISTING:

Your Company's shares are presently listed on The B S E Limited, Mumbai and the listing
fees for F.Y 2016-17 is paid.


PERFORMANCE EVALUATION:

Pursuant to the provisions of the Companies Act, 2013 and Securities and ExchangeBoard
of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, the Board
has carried out the annual performance evaluation of its own performance, the Directors
individually as well as the evaluation of the working of its Audit, Nomination and
Remuneration and Compliance Committees.

A structured questionnaire was prepared after taking into consideration inputs received
from the Directors, covering various aspects of the Board's functioning such as adequacy
of the composition of the Board and its Committees, Board culture, execution and
performance of specific duties, obligations and governance.

A separate exercise was carried out to evaluate the performance of individual Directors
including the Chairman & Managing Director of the Board, who were evaluated on
parameters such as level of engagement and contribution, independence of judgments,
safeguarding the interest of the Company and its minority shareholders etc.

The performance evaluation of the Independent Directors was carried out by the entire
Board. The performance evaluation of the Chairman & Managing Director and the Non
Independent Directors was carried out by the Independent Directors who also reviewed the
performance of the Secretarial Department. The Directors expressed their satisfaction with
the evaluation process.


DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE
FINANCIAL STATEMENTS.

The Company has in place proper and adequate internal control systems commensurate with
the nature of its business, and size and complexity of its operations. Internal control
systems comprising of policies and procedures designed to ensure reliability of financial
reporting, timely feedback on achievement of operational and strategic goals, compliance
with policies, procedure, applicable laws and regulations, and that all assets and
resources are acquired are used economically


PARTICULARS OF EMPLOYEES:

Details pursuant to Section 197 of the Companies Act, 2013 read with Rule 5 of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed
herewith as "Annexure - IV" to this report.


DETAILS ABOUT THE CORPORATE SOCIAL RESPONSIBILITY POLICY DEVELOPED AND IMPLEMENTED BY
THE COMPANY:

The Company does not meet the Criteria as specified in Section 135 of the Companies
Act, 2013 regarding Corporate Social Responsibility.


SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

There are no significant material orders passed by the Regulators / Courts which would
impact the going concern status of the Company and its future operations.


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

"The Company has in place an Anti Sexual Harassment Policy in line with the
requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition
& Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress
complaints received regarding sexual harassment. All employees (permanent, contractual,
temporary, trainees) are covered under this policy.

The following is a summary of sexual harassment complaints received and disposed off
during the financial year 2016-17:

• No. of complaints received: Nil

• No. of complaints disposed off: Nil


ACKNOWLEDGEMENTS:

Your directors acknowledge the continued support from regulatory, government
authorities, staff and all the stake holders for their support and cooperation.


  

    

    
BY THE ORDER OF THE BOARD
  
  

    

    
For Vertical Industries Limited
  
  

    

    
Sd/-
  
  

    

    
P. Janadhan Reddy
  
  

    

    
Chairman & Managing Director
  
  

    
Place: Hyderabad
    

  
  

    
Date: 22.08.2017