Directors Report of Wendt (India) Ltd.

Mar 31, 2025

Your Directors have the pleasure in presenting the 43^rd Annual Report of Wendt (India) Limited (hereinafter referred to as ''the
Company'') together with the Audited Financial Statements for the year ended 31^st March 2025. The Management Discussion
& Analysis Report which is required to be furnished as per SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 (hereinafter referred to as ''the Listing Regulations'') has been included in this Report to avoid duplication
and overlap.

ECONOMIC OVERVIEW

During 2024, the global economy grew at uneven pace rural demand improving on the back of record Kharif

across different regions. Manufacturing activity slowed production and favorable agricultural conditions. The

down in many parts of Europe and Asia due to supply chain manufacturing sector experienced headwinds due to

issues and weak global demand. However, the services subdued global demand and certain domestic seasonal

sector showed better performance and supported growth in factors. However, private consumption remained steady,

several economies. Inflation reduced in most countries, reflecting resilience in domestic demand. Fiscal discipline

though prices in the services sector remained high. While and strong external balance supported by a services trade

commodity prices remained stable, there is still a risk of surplus and healthy remittance growth contributed to

prices rising together again. As growth and inflation trends macroeconomic stability. Together, these factors provided

differ across countries, central banks are expected to take a solid foundation for sustained growth amid external

different approaches to interest rate cuts. This could create uncertainties.

uncertainty around future inflation and interest rates. In

Looking ahead, India s economic prospects for FY 2025-26

addition, global economic stability continues to face

are balanced. Headwinds to growth include elevated

challenges from ongoing geopolitical tensions, conflicts,

geopolitical and trade uncertainties and possible

and changes in trade policies.

commodity price shocks. Domestically, the translation of
In this global context, India displayed steady economic order books of private capital goods sector into sustained

growth. As per the first advance estimates of national investment pick-up, improvements in consumer

accounts, India''s real GDP is estimated to have grown by confidence, and corporate wage pick-up will be key to

6.5 per cent in FY 2024-25. Growth in the first half of p romoting growth. A revival in rural demand-supported by

FY 2024-25 was supported by agriculture and services, with a rebound in agricultural output, moderation in food

inflation, and a stable macroeconomic environment-adds
an upside to near-term growth. Overall, India will need to
improve its global competitiveness through grassroots-level
structural reforms and deregulation to reinforce its medium-
term growth potential.

While the latest projections by International Monetary Fund
(IMF) has pegged global growth at 3.3% and 3.7% for 2025
and 2026, respectively, the latest tariff announcements by
the US government are expected to impact global growth,
but experts indicate no imminent risk of recession. The
economic outlook for India is projected to be stable at 6.5%

in 2025 and 2026, maintaining its position as the fastest-
growing major economy, driven by robust private
investment and macroeconomic stability.

%¦ INDUSTRY STRUCTURE &
sfa DEVELOPMENTS

The demand for Super Abrasive products is closely linked
to the level of industrial production. Super Abrasives are
used to manufacture long-lasting, expensive items like
auto and aircraft parts, demand for which is highly cyclical.
Diamond and Cubic Boron Nitride (CBN) Super Abrasive
products are used extensively in aerospace industry and
other industrial applications where price considerations are
less significant as they incur high initial costs. They are
used in the machining of materials such as nickel, cast iron
and cobalt-based super alloys, where precision in
machining operations is of prime importance.

The increasing complexity of Super Abrasive technology,
especially in high-performance applications, along with the
high initial investment required, creates significant entry
barriers for small and medium-sized enterprises. While
global industry leaders are able to invest heavily in
research and development, most unorganised players lack
access to such resources. This limits their ability to
compete in developing technologically advanced products.

The Company being a total Grinding Solution provider,
innovation is at the core of the Company''s products and
processes. As such majority of our products are
customised to fulfil the customer''s requirements.

The Company is a preferred supplier for many of the
automobile, auto component, engineering, aerospace,
defence, ceramics customers for their Super Abrasive
Tooling solutions, Grinding & Honing Machines and
Precision components. A major contribution to the
Company''s revenues comes from these industries.

rM COMPANY PERFORMANCE OVERVIEW (STANDALONE)

	FY 2024-25	FY 2023-24	% change
Domestic Sales	16834	15682	7%
Export Sales	4363	4944	-12%
Total Sales	21197	20626	3%
EBITDA	5112	5378	-5%
Other Operating and Other Income	1136	919	24%
Profit Before Tax	4969	5233	-5%
Profit After Tax	3829	3950	-3%
Capital Employed	21975	19201	14%
Earnings per Share - Rs.	191.46	197.49	-3%

During the year the Company recorded sales of Rs.21197
lakhs, higher by 3% over the previous year.

Super Abrasive Business

The Super Abrasive business comprising Diamond/CBN
Grinding Wheels in various Bonding Systems, Rotary
Dressers, Stationary Dressers, Hones and Segmented
products is the biggest business vertical of the Company.
The Company continues to take several initiatives
including product development, new customer acquisition,
price correction, horizontal deployment of successful
applications and products, new markets, leveraging all its
products as a complete package solution to serve
customers betterto grow the business.

economic depression. The Company is focusing on
identifying, targeting and onboarding new distributors,
including industry specific distributors like glass,
aerospace, steel in targeted countries, horizontal
deployment of successful applications and products,
dedicated customer meetings/calls, enhanced use of
digital media, e-commerce, technical webinars, social
media posts, marketing campaigns and participation in
international exhibitions in focus countries etc.

Machines Business

Machine tool sales comprises sale of machines both
domestic and export, spares, service and refurbishing of
old machines. In the Machines business, sales declined
8% to Rs. 4364 lakhs. The drop in sales was due to delay in
orders and customers deferring purchase due to adverse
economic situation. The Company continued to mitigate
supply chain issues by better planning, bulk ordering of
some of the critical parts for the year, working closely with
critical vendors and developing alternate vendors. The
initiatives like advance schedule release helped to execute

The Super Abrasive business achieved sales of Rs.14054
lakhs, which is higher by 7% overthe previous year.

The domestic Super Abrasive sales grew by 9% over last
year. This is the highest ever sales for domestic Super
Abrasive business. The higher sales were from industries
like auto, auto ancillaries, steel, bearings, engineering,
cutting tools etc. Some of the initiatives for higher sales
were close working on product development, key account
management for top customers, appointment of precision
dealers, horizontal deployment of successful applications,
application teams support to the sales team and new
product launches etc.

The export Super Abrasives sales during the year was
marginally higher by 2% over the previous financial year.
The marginal increase in export sales was due to reduced
off take from key customers in few countries. The volatile
geopolitical scenario with continued Russia-Ukraine
conflict led to economic instability and changes in global
trade route leading to lower off take from Europe and other
developed countries. The economic recession faced in
some of countries worldwide worsened the situation. The
China plus one strategy adopted by major economies with
localisation led to reduced demand and continued

delivery on time. Further, other initiatives like design for
parts standardisation, dynamic contract reviews and micro
level planning, senior management interaction and visits to
major suppliers, application demonstration and improving
operational efficiency through Total Employee
Involvement (TEI), relay-out of shop to increase the
number of assembly bays, cost optimisation etc., helped in
meeting the plan.

During the year, the Company manufactured 51 machines.
The industry-wise machine sales during last year
comprises majorly to steel followed by cutting tools,
engineering and auto. The Company executed several
new machines during the current year which was well
accepted by the customers. The Company''s strategy of
moving from industry specific to application-based

machines yielded good results during the year. These
machines have been well received by the customers,
projecting a good performance. Machine sales in the
export market achieved good growth and acceptance by
the customers.

During the financial year, the Company entered into a
technology transfer agreement with Wendt GmbH, one of
the Promoters of the Company for manufacturing
peripheral grinding machines for insert grinding
applications. This technology will help the Company to tap
into the global market for peripheral insert grinding
machines with a strategic focus on the sale of new
machines, service revenue and upgrade the installed
machines worldwide.

Precision Products

The Precision Products business clocked sales of Rs. 2779
lakhs, higher by 2% over the previous year.

The Company continues to focus on developing new
products for its components business as a part of its de-
risking strategy and looking at alternate opportunities
wherever possible.

Digital Marketing

The Company continues to maintain its website with
modified and improved content to enhance interaction and
engagement with customers. The website''s look and feel
has been upgraded with enhanced graphics and user
interface. Customers can explore the Company''s products
and successful applications and place their orders online.
Additionally, new products and applications are regularly
updated on social media platforms such as LinkedIn and
YouTube to increase customer awareness. These
initiatives are focused on digital marketing and ease of
doing business in terms of servicing customers better.

On the Information Technology (IT) front, the Company has
undertaken digital transformation initiatives focused on
simplifying and automating processes in areas of
production planning & control, procurement, marketing and
Sales. This year, special emphasis was placed on
upgrading and revamping the Company''s secure network
along with strengthening cybersecurity measures and
improving data governance.

Applications Site

• Automated Vendor Payment: Enabled end to end

vendor payment automation by integrating the
Company''s Enterprise resource planning (ERP) with
Bank portal, while addressing cyber security measures.
This reduces the time spent on searching for open
invoices for payment and minimises documentation
workflow.

• Grit Weighment automation: Eliminates the need for
printing of issue slips and enhances communication
between Production, planning and stores, ensuring
timely grit issuance to production. This lead to time
saving, fewer manual entry errors, zero stock variance
and improves traceability to production.

• Related Party Transaction (RPT): Eliminates manual
tracking of Audit Committee approval limits and
simplifies capturing RPT values for individual vendors/
customers by executing single report. Enables
automatic data validation and report consolidation
without any data loss. Establishes a defined path for
ERP S/4 HANA implementation through Readiness
check.

Infra Site

• Network upgrade and Revamping: For improving
network performance, the Company replaced existing
systems with new firewall, network switches, Wi-fi
controller and devices. Additional Fiber connections
were provided at various locations using a ring
topology to prevent network failure.

• Infrastructure & Security: Network upgrades were
completed to enhance reliability and performance
across sites. The cybersecurity framework was
strengthened through upgraded firewall policies,
implementation of endpoint protection, SolarWinds,
Sentinel One endpoint security and multi-factor
authentication (MFA) across all user accounts.

The Company leverages its core strength like complete
product range - Super Abrasives, Machine Tools and
Precision Components with access to German technology,
renowned global brand ''Wendt'', global connect, domain
knowledge and continued patronage from customers to
grow its business and serve its customers better. It remains
focused on exploring new business opportunities in
Aerospace, Compressor & Hydraulic parts, Special Inserts
and Carbide industry by deploying its core competencies -
expertise, experience and knowledge in Grinding,
Machines & Super Abrasive Tools for manufacturing
related Precision Components.

Exhibitions and Seminars

The Company continues to participate in several
exhibitions to showcase its products and to build rapport
with customers. The Company participated in and
displayed its products at IMTEX Bangalore which was well

Manufacturing

The Company continues to focus on improving operational
efficiency as well as optimal utilisation of various
resources-man, material and machines in manufacturing
and production areas. The Company has implemented
various initiatives to improve efficiency of its processes and
products. Some of the key ones are -

• QRM initiatives were extended beyond manufacturing
shop floors to include manufacturing office operations
through the formation of Q-ROC (Quick Response
Office Cell), helping streamline operations including
supply chain activities. Reduced and sustained
manufacturing lead times to improve throughput
velocities.

• A focused cost reduction approach was implemented
using Hoshin Kanri A3 methodologies, resulting in
measurable cost reductions in manufacturing variable
cost, manufacturing fixed cost and manufacturing
depreciation cost.

• Significant productivity improvements were achieved
through automation projects in Resin, Electroplated
and Rotary Dressers product groups.

• All planned CAPEX for the year was successfully
implemented, creating an additional 20% capacity with
advanced and high-productivity equipment.

• Efforts were concentrated on improving employee
productivity in bottleneck processes.

• Initiated manufacturing of glass grinding wheels for
venturing newer opportunities.

The Company rolled out initiatives like Existing Products
Improvement (EPI), New product Development (NPD) etc.,
during previous year which was further strengthened to
continue pipeline of products offering better value to the
customers.

Focus on Process Efficiency

Supply Chain efficiency is one of the Company''s key focus
areas. The Company continues its focus in reducing
product lead time and improving operational efficiency by
reducing Work in Progress (WIP).

On the raw materials front, the Company continuously
develops alternative, reliable and competitive
sources/suppliers for critical raw materials including
The key growth drivers for India are

Diamond/CBN, machine castings, systems, electrical,
chemicals etc. However, to mitigate supply chain
disruption, the Company has tied up with critical suppliers
with annual orders delivery schedules.

,PJ FUTURE PROSPECTS AND OUTLOOK

India is expected to maintain a 6.5 - 7.5% annual GDP
growth rate in the medium term. Goldman Sachs, the
International Monetary Fund (IMF), and the World Bank
project that India will become the world''s third largest
economy by 2027-2030, surpassing Germany and Japan.
India enjoys demographic dividend with over 65% of the
population below the age of 35 years. Rapid urbanisation
and growing middle class are likely to boost consumption
and productivity. Meanwhile, India is experiencing a digital
economy boom with strong growth in fintech, e-commerce
and IT services. India Stack, Unified Payments Interface
(UPI), Open Network for Digital Commerce (ONDC), and
5G rollout are transforming the digital infrastructure. By
2030, the digital economy is expected to contribute $1
trillion to the country''s GDP.

Sector	Outlook
Manufacturing	"Make in India", Production Linked Incentive (PLI) schemes, and supply chain shifts from China to India.
Green Energy	Big push for solar, wind, hydrogen. India aims for net-zero by 2070.
Technology	Artificial Intelligence (AI), semiconductors, and deep tech startups gaining traction.
Infrastructure	Massive government investments in highways, railways, ports, and airports.
Financial Services	Credit access is improving. Fintechs and Non-Banking Financial Companies (NBFCs) are expanding rapidly.

The anticipated key challenges are:

• Unemployment & Underemployment, particularly in
rural and informal sectors.

• Skill gap for jobs in emerging industries.

• Inequality and regional disparities.

• Climate risks (heatwaves, water scarcity etc.).

• Exposure to global economic shocks like fluctuating oil
prices and geopolitical tensions

India''s distinct advantages include:

• A large domestic market.

• Strong startup ecosystem with over 100 unicorns.

• A strategic geopolitical position (Quad, G20, BRICS).

• Consistent focus on ease of doing business.

India''s GDP is expected to grow to USD 7.5 trillion in 2030
from present USD 3.8 trillion in 2024. This implies India
adds another India in 7 years and set to become the

Manufacturing Hub for the World. This is a big positive for
India as no other economy in the world has such high
growth rate. India has advantages to capitalise on this
unique opportunity which includes the potential for
significant domestic demand, the drive to encourage
manufacturing, and with a distinct demographic edge,
including considerable proportion of young workforce. The
Government''s push to sectors like roads, railways and
metro rail, urban transport, ports, inland waterways and
airports, renewable energy (based on India''s commitment
to Net Zero by 2070), Green infrastructure in terms of green
hydrogen, EV and thrust to defence production and exports
is expected to boost domestic manufacturing.

The Company''s products are used extensively for Auto,
Auto Ancillaries, Engineering, Cutting Tools, Steel,
Ceramics, Refractories, Defence, Aerospace,
Construction and other industry segments. As such the

Company closely monitors the developments in these
sectors and accordingly devises its business strategy.

The Indian Automotive industry is expected to see a
substantial growth over the next 10 years, driven by factors
like rising incomes, urbanisation, and a growing middle
class group. Passenger vehicle sales are projected to
reach 6 million units by 2030, with a Compound Annual
Growth Rate (CAGR) of 5.6% from 2024 to 2030. The
overall Automotive market, including both passenger and
commercial vehicles, is expected to reach 7.5 million units
by 2030, with a CAGR of 5.7%. While internal combustion
engine (ICE) vehicles will continue to hold a significant
share, Electric Vehicles (EVs) and hybrid vehicles are
expected to see rapid growth.

The Indian steel industry is experiencing robust growth,
driven by strong domestic demand and government
support. Projections indicate significant increases in both
production and consumption, with the industry aiming to
reach 300 million tonnes crude steel capacity by 2030-31.
Per capita steel consumption is also expected to rise,
signaling a positive outlook for the sector.

The Indian Abrasives market is experiencing robust
growth, driven by increasing industrial activity and
infrastructure development. The market is projected to
reach USD 3.87 billion by 2033, with a CAGR of 6.02%

from 2025-2033, according to International Market
Analysis Research and Consulting (IMARC) Group. This
growth is fueled by rising demand from key sectors like
automotive, construction, and metal fabrication. Initiatives
like ''Smart Cities Mission'' and ''Housing for All'' along with
rising demand for electronics and automobiles are driving
the growth of Indian Abrasives market.

The Indian Super Abrasives market is experiencing
substantial growth, driven by increasing demand from
various industries and technological advancements in
abrasive materials and processes. While Super Abrasives
currently hold a small percentage of the overall Indian
Abrasives market, growth rate is projected to be the highest
among different Abrasive types.

The global Super Abrasives market is experiencing
substantial growth, with forecasts indicating a market value
of USD 19.9 billion by 2034, up from USD 11.1 billion in
2024, exhibiting CAGR of 6.0%. This growth is driven by
increasing demand from various industries, including
consumer electronics, transportation, and manufacturing.

Major factors responsible for the growth of global Super
Abrasives market include growing awareness for adoption
of high-end technologies and their benefits coupled with
the continuing growth of the Automotive industry. Besides,
the product is widely popular due to its long life cycle, high
scale hardness and superlative performance, which is
anticipated to spur the global Super Abrasives market
growth.

The expected growth of the above sectors provides good
opportunities for the Company''s products - Super
Abrasives, Machines, and Precision Components in future.

The Company''s growth lies in constantly monitoring
changes in the external environment and adapting to the
emerging customer needs. Accordingly, mega trends and
underlying new opportunities that unfold are being tracked
continuously.

The growing usage of Super Abrasive products for various
medical applications such as surgical instruments,
hypodermic needles, dental implants, knee, hip and
shoulder joints create new opportunities for the Company
to explore through technical collaboration and new
products development. Also, growing consumer electronic
segment with manufacturing facilities in India is expected
to provide a wide array of opportunities for consumption of
Super Abrasives in the coming years. The focus on
semiconductor industry which will make India a major hub
for manufacturing semiconductors is expected to be a
major growth engine. The success of addressing these

sectors lies in the technology which the Company is
exploring through necessary tie-ups and collaboration.

Trademark Assignment Agreement

During the year, the Company has entered into a
Trademark Assignment Agreement (Agreement) with
Wendt GmbH, one of its Promoters, for acquiring the
absolute ownership of the “Wendt” brand and trademarks
with over 60 registrations in 40 countries, owned by Wendt
GmbH and/or its affiliates worldwide. The approval of the
shareholders was obtained through postal ballot on
26^th February 2025 and the transfer of the trademark
consummated on 28^th March 2025.

As on the date of this report, the Company, is the absolute
owner of the trademark ‘Wendt'', a well-known mark in the
international Machine building and Abrasives market.

Amendment to Shareholders’ agreement

The Board at its meeting held on 21^stJanuary 2025 had
taken note of the amendment to the Shareholders''
agreement entered into between the Promoters of the
Company, Carborundum Universal Limited and Wendt
GmbH amending certain terms of the Shareholders
agreement for enabling Wendt GmbH to sell its
shareholding in the Company as a part of this strategic
review of exiting its investments in the Company.
ra

SUBSIDIARY COMPANY
Wendt Grinding Technologies Limited,
Thailand

The Company''s wholly owned subsidiary, Wendt Grinding
Technologies Limited, Thailand, (‘the Subsidiary'')
achieved sales of Thai Baht 887 lakhs (about Rs. 2154
lakhs) which is 3% lower than last year. This is due to
unprecedented challenges and industry slowdown on

account of EV impetus, geopolitical uncertainties, rising
costs etc. The Subsidiary continues to demonstrate its
strong resolve and business acumen challenging the
unfavorable conditions and churning out results on a
consistent basis.

The Profit Before Tax was Thai Baht 71 lakhs (about
Rs. 172 lakhs), 18% lower than previous year and the Profit
After Tax was Thai Baht 57 lakhs about (about Rs. 137
lakhs), 19% lower than previous year.

During the year, the Subsidiary resorted to working closer
with the parent company in India with focus on cost and
receivables control, establishing new product trials,
increasing product and customer basket and strengthening
the export business. These initiatives is expected to help in
de-risking the business by compensating for the decline in
existing products. Focus on providing value added
services, enhancing product basket, new customer
additions and entering new geographies is expected to
yield desired results.

The Subsidiary will continue to focus on core business &
value-added services and increased customer/product
base along with measures to ensure OPEX, safety and
cash flow to achieve sustainable & profitable growth.

	FY 2024-25	FY 2023-24	% change
Sales	23114	22482	3%
EBITDA	5259	5564	-5%
Other operating and other Income	1134	913	24%
Profit BeforeTax	5123	5421	-5%
Profit After Tax	3948	4095	-4%
Earnings per share - Rs.	197.43	204.77	-4%

The Consolidated Financial Statements of the Company
for the financial year 2024-25 are prepared in compliance
with the applicable provisions of the Companies Act, 2013,
Accounting Standards as prescribed by Regulation 33 of
the Listing Regulations. The Consolidated Financial
Statements have been prepared based on the audited
financial statements of the Company and its subsidiary, as
approved by their respective Board of Directors.

Pursuant to provisions of Section 136 of the Companies
Act, 2013, the Financial Statements of the Company, the
Consolidated Financial Statements along with the relevant
documents and the Auditors'' Report thereon form part of
this Annual Report. A statement of summarised financials
of the Company''s wholly owned subsidiary in form AOC-1
forms part of the Annual Report. The audited annual
accounts and related information of the Subsidiary is
available on ourwebsitewww.wendtindia.com.

DIVIDEND

Considering the past dividend pay-out ratio and the current
year''s operating profit, the Board has recommended a final
dividend of Rs. 20/- per equity share of Rs.10/- each for the
year ended 31^st March 2025. Besides, an interim dividend

at the rate of Rs. 30/- per equity share of Rs.10/- each was
declared in January 2025 and paid in February 2025. This
aggregates to a total dividend of Rs. 50/- per equity share of
face value of Rs.10/- each.

The Company has adopted the Dividend Distribution Policy
as approved by the Board in line with the Listing
Regulations and the same is available on the Company''s
website https://wendtindia.com/wp-
content/themes/wendtindia/pdf/dividend-distribution-
policy.pdf

The objective of this policy is to establish the parameters to
be considered by the Board of Directors of your Company
before declaring or recommending dividend.

The interim dividend paid and the proposed final dividend
for the year ended 31^st March 2025 are in line with this
policy.

@ TRANSFERTO RESERVES

The Company transferred Rs.383 lakhs to the General
Reserve. An amount of Rs.1412 lakhs is retained in the
Statement of Profit & Loss.

Appropriations
Profit After Tax	3829
Add: Other Comprehensive Income	(55)
Add: Balance brought forward from previous year	11,729
Total	15,503
Recommended appropriations
Transfer to General Reserve	(383)
Dividend - Final (Dividend paid for 2023-24 - Rs.20/- per share of face value of Rs.10/- each)	(400)
Dividend -Interim (Dividend paid for 2024-25 - Rs.30/- per share of face value of Rs.10/- each)	(600)
Balance carried forward	14120

|_r„^ CORPORATE SOCIAL RESPONSIBILITY

(CSR)

The Company believes that social responsibility is not just
a corporate obligation that has to be carried out, but an
opportunity to make a difference. All our CSR programs are
aimed at inclusive growth and sustainable development of
the community.

Grounded in ethical business practices, the Company''s
CSR efforts are designed to foster economic development
while directly benefiting local communities and society at
large. As a proud member of the Murugappa Group, the
Company continues to uphold the Group''s long-standing

tradition of philanthropy by allocating a portion of its profits
for social causes. The Group''s core CSR philosophy
emphasises education and healthcare, delivered through
service-oriented institutions.

Education Initiatives

During the financial year 2024-25, the Company
implemented a range of impactful, education-focused
initiatives aimed at improving infrastructure and learning
outcomes in government schools around the Hosur region.

Key projects were:

• Construction of classrooms at Government Panchayat
Union Primary (PUP) Schools in Peddaelasagiri and
Begepalli, Hosur.

• Installation of RO drinking water systems at PUP
Schools in Peddaelasagiri, Zuzuvadi and Sri Sathya
Sai Bala Gurukulam Matriculation School, Hosur.

• Provision of computer and projector system to the
Sri Sathya Sai Bala Gurukulam Matriculation School,
Hosur to support digital learning.

• Installation of Smart Boards at PUP Schools in
Bedarapalli and Matham Agraharam, higher secondary
Urdu School in Hosur, and the Sri Sathya Sai Bala
Gurukulam Matriculation School, Hosur.

• Supply of desks and benches for students at PUP
Schools in Zuzuvadi, Bedarapalli, Arasanatti, and
Matham Agraharam in Hosur.

• Provision of tables and chairs for teachers at PUP
Schools in Bedarapalli and Arasanatti in Hosur to
enhance classroom environments.

• Construction of a Prayer Stage at the PUP School in
Chinnaeleasagiri in Hosur to facilitate school
gatherings and cultural activities.

• Provision of photocopy machines to the PUP Schools in
Bedarapalli and Urdu higher secondary School in
Hosur to support administrative and academic needs.

The Company remains steadfast in its commitment to
revitalizing government schools, many of which continue to
operate with inadequate infrastructure and limited
resources.

Healthcare Initiatives

As part of its healthcare efforts, the Company contributed
a Pasteurizer with Chiller and Breast Pump to the
Government Hospital in Hosur. It is intended to strengthen
the infrastructure of government healthcare facilities
serving underprivileged and rural population.

Environmental and Social Engagement

In support of environmental sustainability, the Company
regularly distributes and plants tree saplings within
surrounding communities. Additionally, employees are
encouraged to actively participate in social outreach
programs such as:

• Blood donation camps

• Road safety awareness campaigns

• Volunteering as traffic wardens in coordination with the
Hosur Traffic Police

Governance and Compliance

In accordance with the Companies Act, 2013, the
Company formulated and executed an annual CSR Action
Plan, duly approved by the Board of Directors. During the
financial year 2024-25, the Company spent Rs. 94.27
lakhs on CSR activities. As of the end of the year, no CSR
amount remains unspent.

In accordance with requirements of the Companies Act,
2013, the Company has a CSR policy incorporating the
requirements therein which is also available on Company''s
website at the following link https://wendtindia.com/wp-
content/themes/wendtindia/pdf/csrpolicy.pdf.

The Annual Report on CSR activities in the prescribed
format is annexed herewith as Annexure C.

TRANSFER TO THE INVESTOR EDUCATION
& PROTECTION FUND (IEPF)

In terms of Section 124 (5) of the Companies Act, 2013, an
amount of Rs. 4,18,175 being unclaimed dividend during
the year, pertaining to the Final dividend for the FY 2016-17
(Rs. 3,19,935) and the Interim Dividend of FY 2017-18
(Rs. 98,240) was transferred to IEPF after sending due
reminders to the shareholders.

FIXED DEPOSITS

The Company has not accepted deposits from the public
falling within the ambit of Section 73 of the Companies Act,
2013 and the rules framed thereunder, and no amount of
principal or interest was outstanding as on the balance
sheet date.

LOANS AND INVESTMENTS

Particulars of Loans, Guarantees and Investments
covered under section 186 of the Companies Act, 2013 are
given below. There were no loans or guarantees covered
under section 186 granted during the year.

Description	As on 31.03.2024	Movement (net of deletions)	As on 31.03.2025
Loans given by the Company	-	-	-
Corporate Guarantee given by the Company	-	-	-
Investments made by the Company	277	-	277

Current Investments: Investments in Mutual Funds as on 31.03.2025 was Rs.4578 Lakhs.

Sl.No.	Ratio	In terms of	31.03.2025	31.03.2024
1.	Performance Ratios
a.	Operating Profit / Net Sales	(%)	19	22
b.	EBIDTA / Net Sales	(%)	28	29
c.	PBIT / Net Sales	(%)	23	25
d.	Net Profit / Net Sales	(%)	18	19
e.	Return on Capital employed	(%)	27	27
f.	Return on Equity	(%)	19	22
g.	Fixed Asset Turnover Ratio	Times	2.54	3.58
2	Activity Ratios
a.	Inventory Turnover Ratio	Days	59	58
b.	Receivable Turnover Ratio	Days	101	79
3	Liquidity Ratio
a.	Current Ratio	Times	2.11	2.37

There is no significant change in the ratios and the decreas
lower Profit after tax (PAT) during the year.

% QUALITY

Quality being the uncompromised differentiator, the
Company aims to ensure that product quality is built by
deploying and embracing effective quality control
management, process robustness, quality assurance and
discipline at every stage of material flow.

The following are some of the major work done on Quality
during the year:

Customer Satisfaction: Reduced complaint closure time
by introducing a structured Root Cause Analysis (RCA)
and Corrective Action system.

launches, reduced iterations and faster Product part
approval process (PPAP) approvals.

Quality Assurance Involvement in New Product
Introduction (NPI): Early involvement of Quality
assurance team in NPI processes led to smoother product

Internal Quality Improvements: Strengthened the
internal process audit system with an emphasis on process
adherence and continual improvement.

Supplier Quality Management: Collaborated with
suppliers on defect reduction, achieving a First time right
(FTR) rate of 99.91% and significant improvement in
incoming quality levels.

Certifications and Audits:

During the FY 2024-25, the Quality team successfully
maintained all applicable quality management system
certifications, reinforcing the organisation''s commitment to
global standards and customer expectations.

The Company has certifications of ISO 9001: 2015, ISO
14001: 2015, ISO 45001: 2018, EN9100: 2018, IATF
16949: 2016 and EN 13236: 2019 reinforcing its
commitment to ensure that Quality Management
Standards are met.

The Company has successfully re-certified for ISO 9001:
2015, ISO 14001: 2015, ISO 45001: 2018, EN9100: 2018
and IATF 16949: 2016 Standards during the year and re¬
certified for EN13236:2019.

ft ,1 SAFETY, H EALTH AN D
ENVIRONMENT (SHE)

Safety continues to be the key area of focus for the
Company. Behavior based training both in person as well
as virtually were conducted to promote a culture of safe
working. The Company recognises the need and is
committed to providing Safe, Healthy and Socially
Accountable Work Culture in the Organisation.

safety amongst employees and visitors including by way of
setting up of safety training kiosk.

All personnel on a periodical basis receive effective health
and safety training, including on-site training, job specific
training etc. During the year, the Company has provided
trainings for creating awareness about the significance of

The Annual medical check-up facility continues to assess
the health status and risk of the employees. Employees
benefitted from awareness sessions organised on the
theme- FHH (Fitness, Health and Happiness) and were
encouraged to take initiatives to improve their health and
fitness.

During the year, several key initiatives were continued,
including the conduct of quarterly mock drills for fire safety,
provision of specialised medical attention for employees
engaged in sensitive and high-risk processes, and strict
enforcement of the use of Personal Protective Equipment
(PPE). The Company also adhered to zero-discharge
norms in its Effluent Treatment Plant (ETP) and Sewage
Treatment Plant (STP), and maintained robust systems for
the safe handling and disposal of hazardous waste.

H RECOGNITIONS AN D AWARDS

The Company encourages its employees to participate in
customer audits, group competitions, various national and
international events & competitions. During the year, the
Company received many awards and accolades from well
recognised organisations, establishments and certifying
bodies for various distinctive achievements. Needless to
mention that these recognitions and accolades enhance
the passion and optimism among the employees and act as
key motivator for the Company as a whole. Some of the key
recognitions received during the year are as follows:

• OEM Recognition Award

The Company received Original Equipment
Manufacturer (OEM) Recognition Award.

• CFO 100 -Roll of Honor 2025

The Company''s Chief Financial Officer (CFO), Mukesh
Kumar Hamirwasia was conferred with the CFO 100
Roll of Honor 2025 from CFO Collective (IMA India).

• QCFI-NCQC 2024 Competition

Won 2 Excellence Awards in NCQC Competition held
during Dec 2024.

• QCFI-CCQC 2024 Competition

8 teams participated in CCQC Competition during Oct
2024, 7 teams won Gold Award and 1 team won Silver
Award.

• CUFEST 2024 Awards

Employees participated in Group-level Quality
competition ''CUFEST 2024'' (Quality festival of CUMI),
and won awards for Suggestion, Engineering
Excellence, SGA, and 5s categories.

Disruptive technologies like Electric Automobiles, the
recent emerging trend in the Automotive industry, although
a threat to the IC engine, also provides opportunities to
explore this segment and find opportunity in this industry.

Nano Cubic Boron Nitride Abrasives are likely to augment
applicability of Super Abrasives in many medical and
electronic industry applications. The Company is exploring
to venture into EV, medical and electronics segments by
collaboration and technology tie-ups with global partners to
grow further.

The industries in the Auto, Aerospace, and Electronics
manufacturing space demand high-performance
applications. Improvements in the design of diamond
wheels used to finish ceramics can be key to cost- effective
manufacturing. Metal-bond specially design wheels for
longer wheel life can lead to shorter process cycle times
while also ensuring longer life, thereby reducing the overall
grinding cost. The Company achieving the Aerospace
certification is a step in looking at growing this segment in
future.

The Company would continue to leverage upon its vast
experience and technical expertise, deep understanding of
customer requirements, comprehensive product range,
superior technology and the resultant competitive edge
emerging out of its complementary business verticals
namely Super Abrasives, Machine Tools and Precision
Components.

Further, the Government''s focus on Projects like ''Make in
India'' and ''Make for World'' are expected to give a boost to
the Company''s products being import substitute, thus
helping in conservation of precious foreign exchange
during these difficult times.

A THREATS

Industry leaders across the globe, with high brand value
afford significant Research operations. Investment in
Research &Development activities by these major players
to innovate in the existing products and develop new
technologies to sustain competition in the market is very
high. On the other hand, there are many unorganised,
regional proprietary run entities that are smaller in size with
limited offerings, which address customers'' requirements
in a specific region only.

In order to counter both the extremes, the Company strives
to evolve a unique approach to improve its market
presence, market share and address both the segments.
To address the price competitive market, the Company has
launched fast-moving and Standard Super Abrasives and
other tooling products and has been aggressively

conducting promotional activities at the vicinity of high
potential customers. For addressing the high performance,
quality conscious segment, the Company is working with
foreign Research Institutes and is on lookout for product
specific, niche manufacturers for acquiring state-of-the-art
technology.

ENTERPRISE VALUE ADDITION (EVA)

The Company has been able to continuously add value, the summary of which is given below:

Particulars	2024-25	2023-24	2022-23	2021-22	2020-21
Generation of Gross Value added	9965	9736	9432	7494	5451
Breakup on Application of Value added
Payment to Employees	3977	3637	3362	3110	2928
Payment to Share holders (on payment basis)	1000	1600	1500	800	700
Payment to Government	1094	1273	1213	921	375
Payment to Directors	35	35	39	29	24
Towards replacement and expansion	3859	3190	3318	2634	1424
Total	9965	9736	9432	7494	5451

• Gross Value Added is Revenue less Expenditure (excluding depreciation, expenditure on employees & directors''
service).

• Payment to Government is current tax dividend distribution tax, if any.

• Replacement and expansion is Retained earnings Depreciation Deferred tax.

• The Company has been constantly investing towards replacement and expansion expenditure to ensure fulfilment of
market demand.

The Company has constituted a Risk Management
Committee (RMC) aligned with the requirements of the
Companies Act, 2013 and the Listing Regulations. The
details of the Committee and its terms of reference are set
out in the Corporate Governance Report forming part of
this Report.

The Company has a robust business risk management
process to identify, evaluate and mitigate risks impacting
the business including those which may threaten the
existence of the Company. This framework seeks to create
transparency, minimise adverse impact on the business
objectives and enhance the Company''s competitive
advantage. This also defines risk management approach
across the organisation across various levels including
documentation and reporting. The framework has different
risk models which help in identifying risk trends, exposure
and potential impact analysis at a company level and also
for the business segments.

In an ever-changing economic landscape marked by
dynamic customer demand, the Company proactively

monitor risks to evaluate their potential short term and long
term impact and strategically plan for effective mitigation.

The Company determines the categories of risk from
strategic, operational, environmental, legal, social, cyber
risks, extended to enterprise and financial risks which the
organisation may be exposed to and could impact its ability
to conduct its business operations without disruption, to
provide customer satisfaction and achieve sustainable
success.

The Risk Management also forms an integral part of the
Company''s Business Plan.

The Company has also developed a structured Risk
Management Policy encompassing the risk management
objectives, principles, processes, responsibility for
implementation, maintenance of risk registers, review of
risk movements, risk reporting framework etc.The Risk
Management Committee continued to review the risks and
mitigation plan as per the adopted Charter and Risk
Management Policy.

After the risk is identified, risk prioritisation is undertaken
which involves assigning a score based on the impact
(potential outcome) & likelihood (probability of
occurrence).The risks are also assessed for velocity (how
fast a risk can impact an organisation) to assess the need
for crisis plan.The risk response of the Company is of the
following types:

• Avoidance i.e., not to start or continue with an activity
which gives rise to a risk.

• Sharing the risk i.e., sharing with another party, the
burden of loss or the benefit of gain, from a risk.

• Mitigating risk, an action that reduces the impact or
likelihood of a risk.

• Retention, where no worthwhile controls actions are
feasible, and the risk is within the Company''s tolerance
level.

INDIAN ACCOUNTING STANDARDS (IND
AS) - IFRS CONVERGED STANDARDS

The Company had adopted IndAS with effect from 1^st April
2016 pursuant to the Companies (Indian Accounting
Standard) Rules,2015 notified by the Ministry of Corporate
Affairs on 16^th February 2015.

INTERNAL CONTROL SYSTEM &
ADEQUACY

The Company has an Internal Control system
commensurate with the size, scale, and complexity of its
operations. The controls have been designed and
categorised based on the nature, type and the risk rating so
as to effectively ensure the reliability of operations with
adequate checks and balances.

The Company''s internal control system covers the
following aspects:

• Safeguarding the assets of the Company;

• Financial proprietary of business transactions;

• Compliance with prevalent statutes regulations,
policies and procedures;

• Control over capital and revenue expenditure with
reference to approved budgets;

• Investment decisions are subject to detailed
evaluation and formal approval according to the
authority schedule in place.

The Internal Audit function is handled by an external firm
which evaluates the effectiveness and adequacy of internal
controls, compliance with operating systems, policies and
procedures of the Company and recommends
improvements. The scope of the Internal Audit is annually
determined by the Audit Committee considering inputs
from the Statutory Auditors and the Management Team.
Significant audit observations and the corrective/
preventive actions taken by the process owners is
presented to the Audit Committee. A Periodic review of the
adherence to the agreed action plan is carried out.

Capital and revenue expenditures are monitored and
controlled with reference to approved budgets. Investment
decisions are subject to detailed evaluation and formal
approval according to schedule of authority in place. A
periodical review of capital expenditure with reference to
benefits forecasted is done. Physical verification of assets
is also periodically undertaken.

The Audit Committee reviews the overall functioning of
Internal Audit on a periodical basis. Periodical reviews of
audit plans, observations, and recommendations of the
internal and external auditors, with reference to the
significant risk areas and adequacy of internal controls are
undertaken by the Committee and keeps the Board of
Directors informed of its observations, if any, from time to
time.

During the year, there were no changes in internal control
over financial reporting that have materially affected or are
likely to have any financial reporting lapse.

The Board based on the recommendation of the Audit
Committee had re-appointed M/s. Profaids Consulting as
Internal Auditors of the Company.

m, INTERNAL FINANCIAL CONTROLS (IFC)

Internal Control is a process, effected by an entity''s Board
of Directors, Management and other personnel, designed
to provide reasonable assurance regarding the
achievement of objectives relating to operations, reporting
and compliance as defined by the Committee of
Sponsoring Organizations (COSO) of the Treadway
Commission (appointed by SEC, USA).

As per Section 134(5)(e) of the Companies Act, 2013, the
term Internal Financial Control (IFC) means the policies
and the procedures adopted by the Company for ensuring:

a) orderly and efficient conduct of its business, including
adherence to accounting policies;

b) safeguarding of its assets;

c) prevention and detection of frauds and errors;

d) accuracy and completeness of accounting records and

e) timely preparation of reliable financial information.

The key components of IFC followed by the Company are:

1. Entity Level Controls (ELC) that the management
relies on to establish appropriate Code of Conduct,
Enforcement and Delegation of Authority, Hiring and
Retention practices, Whistle Blower mechanism and
other policies and procedures.

2. Process Level Controls (PLC) to ensure processes are
stable, predictable and consistently operating at the
targeted level of performance with only a normal
variation are classified into Manual or Automated or IT
dependent Controls. They are also classified as
Preventive or Detective.

3. General IT Controls to ensure appropriate functioning
of IT applications and systems built by Company to
enable accurate and timely processing of financial
data are-User Access rights Management and Logical
access; Change Management controls; password
policies and practices; Patch management and
License management; backup and recovery of data.

The adequacy of IFC is ensured by:

• Documentation of risks and controls associated with
major processes;

• Validation classification of existing Controls to mitigate
risks;

• Identification of improvements and upgrades to the
control;

• Improving the effectiveness of controls through data
analytics;

• Performing testing of controls by Independent Internal
Audit firm;

• Implementation of sustainable solutions to Audit
observations;

The IFC Audits conducted annually by an independent firm
of Chartered Accountants by testing of controls to ensure
that all controls are operational, effective, adequate and
identifying improvements to controls wherever necessary
which is reviewed by the Audit Committee.

& FINANCIAL REVIEW

Liquidity and Cash Equivalents

The Company follows efficient working capital
management. This requires being prudent in capital
expenditure. Also, making its cash conversion cycle more
efficient through faster collections from debtors, faster
conversion from raw materials to finished goods through
Quick Response Manufacturing (QRM) resulting in healthy
cash generation. Thereby, the Company is able to maintain
its debt-free status.

The Company''s robust Cash Management Policy
comprises of:

a. Usage of cash to provide sufficient working capital to
address business objectives of the Company and to
add value to all stakeholders by continued
enhancement.

b. Conserving sufficient cash as reserves that will aid the
Company in venturing into meaningful business
opportunities that unfold in future.

c. Prudently invest surplus funds that the business
generates in liquid investments including AAA or AA
rated debt schemes of mutual funds as per the Board
approved policy.This ensures the availability, safety
and liquidity of the Company''s funds while ensuring
reasonable yield as per the prevailing market rates.
The surplus funds are generated through stringent
control of working capital.

As on 31^st March 2025, the Company''s investment in debt
mutual funds was Rs.4578 lakhs in securities holding
papers with high credit rating.

Costs

The Company continues the cost optimisation initiatives
which started as a dedicated programme during the
pandemic. This leads to continued focus on controllable
costs in terms of reduction of losses and rejections, better
negotiations with suppliers and vendors, price increase
with customers and better price realisation from sale of
scrap etc. The Company managed its cost by negotiating
annual price with critical suppliers and buying in bulk based
on annual demand projection. To combat supply chain
disruption, the Company continues developing alternate
suppliers as a part of its de-risking strategy. Also, the
Company continues looking at the indigenisation of some
of the supplies.

Initiatives like Vendor Managed Inventory (VMI) has
ensured continuity of supplies of critical items including
rationalisation of costs. Focus on Cost Optimisation has
yielded savings in all the business segments. The variable
and fixed cost reduction initiatives undertaken in the
previous year has resulted in good improvement in the
bottom line.

(H, FINANCIAL POSITION
Share Capital

The paid-up equity share capital as on 31^st March 2025 was
Rs. 200 lakhs. During the year under review, the Company
has not issued shares with differential voting rights nor
granted stock options nor sweat equity.

Shareholders'' Funds

The shareholders'' fund as on 31^st March 2025 was
Rs.21975 lakhs against Rs.19201 lakhs of previous year.
Accordingly, the book value of the share stands at
Rs. 1099/- as compared to Rs.960/- during the previous
year.

Loan Funds

The Company continues its debt free status as it does not
have any long-term borrowing. It continues to utilise its
cash credit limit with the banks to bridge the short-term fund
requirement and for meeting the temporary mismatches in
its cash flow.

Credit Rating

Your Company''s credit rating as on 31^st March 2025 is as
follows:

Rating Agency Long-term Short-term

Debt facilities Debt facilities

ICRA Limited AA (-) Stable, A1( )

Positive Outlook

The working capital limits of the Company continued to be
rated by ICRA as AA- (pronounced ICRA double A minus)
rating assigned to the Rs. 2 Crore Long-term Fund facilities
of the Company which signifies low credit risk and stable.
The short-term rating assigned to Rs. 19 crore Non-Fund
Based working capital limit also continued to be reaffirmed
as A1 (pronounced ICRA A one plus).

There are no material changes and commitments affecting
the financial position of the Company which occurred
between 31^st March 2025 and the date of this Report.

^ ASSETS

CAPITAL EXPENDITURE

The Company follows the policy of being prudent in its
capex spend. During the current year, the capital
expenditure was Rs. 5829 lakhs (Previous year: Rs.1115
Lakhs). The major capex spent was on addition of new
plant & machinery towards capability building in fast
growing products and new products capacity
enhancements, which are critical for the future growth of
the Company. Further, the Company acquired the ‘Wendt''
brand at a consideration of Rs. 3508 lakhs.The acquisition
of this brand will help Company leverage the global market.
As in the past, the Company follows the policy of funding all
the capex through internal accruals. The Company reviews
all its capex investments performance periodically against
the projected rate of interest and payback period.

INVENTORIES AND SUNDRY DEBTORS

The Company follows rigorous Working Capital
Management, based on a robust process of continuous
mon itori ng and control of receivables, inventories and
other parameters. The overall inventory level as on
31^st March 2025 is Rs. 3440 lakhs which is at same levels
as against previous year (Rs. 3385 lakhs as on 31^st March
2024).

Receivables (Gross) as on 31^st March 2025, were at
Rs. 6694 lakhs against Rs.5220 lakhs during the previous
year. The higher receivables are due to record highest
sales executed during March 2025. The Company closely
monitors the Days Sales Outstanding (DSO) through an
aggressive receivable management system including
close follow-ups and credit lock through the SAP system,
DSO is at 101 days as on 31^st March 2025 (79 days as on
31^st March 2024), primarily on account of higher sales
during March 2025. This ensures that receivables are kept
under control and payments received on time.

FOREIGN EXCHANGE HEDGING

The Company, being a net exporter, continues to practice
natural hedging of foreign exchange earnings and outflow
and does not take forward covers. The net forex gain during
the year was Rs.94 lakhs (Previous Year: Rs.93 lakhs).

oQo

Human Resource

At Wendt, an engineering and knowledge-driven
organisation, employees are regarded as the Company''s
most valuable assets. The Company is proud of its strong
and diverse workforce, where every individual is seen as a
"Partner in Progress." The Company''s human capital -
encompassing the education, experience, potential, and
capabilities of our people - is a key intangible asset that
drives business growth and innovation.

The Company actively promotes diversity and encourages
employee involvement in continuous improvement
initiatives such as Cross Functional Teams (CFTs),
Kaizens, Small Group Activities (SGAs) and the
Suggestions Scheme, fostering a culture of ownership and
collaboration at all levels.

Employee Safety and Wellbeing remain top priorities, with
direct oversight and commitment from the Board. Periodic
training and awareness programs are conducted to
proactively identify and eliminate unsafe working
conditions. The Company has also engaged a professional
counsellor to support employees'' mental health and
wellbeing, supplemented by monthly wellness sessions led
by subject matter experts on various health-related topics.
The Company takes pride in reporting zero-accident record

throughout the financial year. This achievement reflects
continued commitment of the Company to the highest
standards of workplace safety, proactive risk management
and the collective efforts of all employees in fostering a
culture of safety and accountability.

Industrial harmony has been sustained through cordial
employee relations and a positive work environment. As of
31^st March 2025, the Company''s permanent employee
strength stood at 391. Various employee committees such
as Health & Safety, Canteen, Events, Women''s POSH and
Works Committee remain active in driving employee
engagement and addressing grievances in a timely and
effective manner.

The Company continues to uphold its commitment to a safe
and respectful workplace through a robust Policy on
Prevention of Sexual Harassment, in alignment with the
Sexual Harassment of Women at the Workplace
(Prevention, Prohibition and Redressal) Act, 2013. An
Internal Complaints Committee (ICC) has been duly
constituted as per statutory requirements. No complaints
were received during the year under review.

Major HR Initiatives of 2024-25

Enabling Change Management & Leadership

Development

• Developed a long-term strategic recruitment plan to
address future workforce needs, including targeted
headhunting for niche roles.

• Conducted 9-Box assessments to identify high-
potential talent (L2 and L3) and initiated structured
leadership development programs.

• Strategically restructured Product Development and
R&D teams to enhance agility and innovation.

• Launched specialised training initiatives, including
international exposure in Germany for advanced
machine-building skills.

• Continued to advance its alignment with LTS 2030
vision by focusing on capability building and workforce
planning.

Hiring & Onboarding Excellence

• Regional consultants were engaged to support
location-specific hiring and improve recruitment
effectiveness.

• Hired and trained Graduate Engineering Trainees
(GETs) for sales and application roles to build a future-
ready talent pool.

• Enhanced the onboarding experience with revised
orientation, buddy and mentoring systems and pre-

boarding platforms.

• Established functional head review mechanisms to
provide timely feedback to new hires and ensure
alignment of their early contributions with
organisational goals.

Talent Retention and Engagement

• Conducted comprehensive market benchmarking
leading to pay adjustments to stay competitive and
retain top talent.

• Introduced employee feedback mechanisms and
executed engagement surveys with targeted action
plans.

• Increased senior leadership connect through regional
performance review visits.

• Designed custom compensation packages for niche
technical positions to address talent gaps.

Operational Excellence and Productivity
Enhancement

• Initiated labour demand forecasting and staffing mix
optimisation (permanent, trainee and contract).

• Executed targeted upskilling programs to remove
productivity bottlenecks in key departments.

• Integrated Lean principles and multi-skilling strategies
to improve workforce flexibility and output.

Digitalisation and Analytics

• Digitised Human Resource (HR) processes including
recruitment, onboarding, attendance, reimbursement,
Employee Self Service (ESS), and performance
management.

• Rolled out HR Analytics Dashboards for real-time
insights on key HR metrics, productivity and attrition.

• Promoted AI-based tools to improve recruitment
quality and reduce process cycle time.

Industrial Relations and CSR

• Sustained harmonious industrial relations through
regular shop floor engagement and proactive
grievance handling.

• Formed employee committees to co-create solutions
and enhance workforce participation.

• Rolled out wellness programs including monthly
awareness sessions and access to professional
counseling.

• Supported CSR initiatives across seven (7) schools
through infrastructure improvement programs and one
(1) Government hospital.

RELATED PARTY TRANSACTIONS

The Company, as per the requirements of the Companies
Act, 2013 and Regulation 23 of the Listing Regulations has
a Policy for dealing with Related Parties. Further, in line
with the amendments made in Listing Regulations
pertaining to related party transactions which are effective
on prospective basis i.e. 13^th December 2024 onwards, the
policy on dealing with related party transactions was
amended to adapt to the changes.

In line with its stated policy, all Related Party transactions
both under the Companies Act, 2013 as well as the Listing
Regulations are placed before the Audit Committee for its
review and approval. Prior approval of the Committee is
obtained on a quarterly basis for the transactions that are
foreseen and repetitive in nature. Omnibus approval in
respect of transactions which are not routine, or which
cannot be foreseen or envisaged are also obtained as
permitted under the applicable laws and the thresholds are
periodically reviewed. The list of Related parties is
reviewed and periodically updated as per the prevailing
regulatory conditions. Further, as per amended provisions
of Listing Regulations, the Independent members of the
Audit Committee are now allowed to ratify Related Party
transactions which are not material upto a value of ratified
transaction of Rs. 1 crore.

The details of transactions proposed to be entered with
Related Parties are placed before the Audit Committee for
approval on an annual basis before the commencement of
the financial year. Thereafter, a statement containing the
nature and value of the transactions entered by the
Company with Related Parties is presented for quarterly
review by the Committee. Further, revised estimates or
changes, if any to the proposed transactions for the
remaining period are also placed for approval of the
Committee on a quarterly basis. Besides, the Related Party
transactions entered during the year are also reviewed by
the Board on an annual basis. During the Audit Committee
meeting held on 14^th March 2025, the transactions of the
subsidiary company with their Related Parties as well as
those envisaged with the Related parties of the Company
were placed before the Audit Committee of the Company
along with the minimum information in the format as
introduced by SEBI vide circular dated 14^thFebruary 2025
read along with the Industry standards note.

During the Audit Committee meeting held on 14^th March
2025, the estimated transactions of the subsidiary
company with their Related Parties as well as those
envisaged with the Related parties of the Company were

placed before the Audit Committee of the Company. The
approval of estimates and revisions to this list of
transactions is planned in the same manner as done for the
parent company (detailed above).

All transactions with Related Parties under the Companies
Act, 2013 entered during the financial year were in the
ordinary course of business and on an arm''s length basis
and hence no particulars are required to be entered in the
Form AOC-2. Further, all transactions entered into with
Related Parties during the year even at arms'' length basis
and in the ordinary course and hence no disclosure was
required to be made in Form AOC-2. Accordingly, there are
no contracts or arrangements entered with Related Parties
during the year to be disclosed under Sections 188(1) and
134(h) of the Companies Act, 2013 in Form AOC- 2. The
Form AOC-2 in the prescribed format is annexed to this
report as Annexure B.

During the financial year 2024-25, as required under
Regulation 23 of the Listing Regulations, the of the
Members was obtained on 26^th February 2025 for the
material related party transactions entered/ to be entered
with Wendt GmbH during the FY 2024-25 and FY 2025-26
pertaining to purchase & sale of goods and materials,
commission income, consideration for trademark
assignment and payment of technology license fee.

There are no materially significant Related Party
transactions made by the Company with its Promoters,
Directors, Key Managerial Personnel, or their relatives may
have a potential conflict with the interest of the Company at
large.

The Policy on Related Party Transactions as approved by
the Board is uploaded on the Company''s website
https://wendtindia.com/wp-content/uploads/2025/04/
Policv-on-Related-Partv-Transactions.pdf None of the
Directors and KMPs had any pecuniary relationship or
transaction with the Company other than those relating to
remuneration in their capacity as Directors/Executives and
corporate action entitlements in their capacity as
shareholders of the Company.

BUSINESS RESPONSIBILITY AND
SUSTAINABILITY REPORT (BRSR)

The Company''s ethical and responsible behaviour
complements its corporate culture. Being a public listed
company, the Company recognises that its accountability
is not limited only to its shareholders from a financial

perspective but also to the larger society in which it
operates. In November 2018, the Ministry of Corporate
Affairs (MCA) constituted a Committee on Business
Responsibility Reporting (‘the Committee'') to finalise
business responsibility reporting formats for listed and
unlisted companies, based on the framework of the
National Guidelines on Responsible Business Conduct
(‘NGRBC''). Through its report, the Committee
recommended that Business Responsibility Reporting
(‘BRR'') be upgraded to Business Responsibility and
Sustainability Reporting (BRSR) where disclosures are
based on ESG parameters, compelling organisations to
holistically engage with stakeholders and go beyond
regulatory compliances in terms of business measures and
their reporting. SEBI, vide its circular dated May 10, 2021,
made BRSR mandatory for the top 1,000 listed companies
(by market capitalisation) from fiscal 2023.

A copy of the Policy is available at https://wendtindia.com
/wp-content/uploads/2025/02/Busines-Responsibility-
Policy.pdf

The Business Responsibility and sustainability Report for
the year ended 31^st March 2025 in terms of amended
Regulation 34 of the Listing Regulations is annexed to this
Report as Annexure E.

GOVERNANCE

BOARD OF DIRECTORS

As on 31^st March 2025, the Board of the Company
comprised six (6) Directors of which half (three) are
independent.

During the FY 2024-25, Mr. C Srikanth stepped down as an
Executive Director and Chief Executive Director effective
close of business hours on 5^th May 2024 and Mr. Ninad
Gadgil was appointed as an Executive Director & Chief
Executive Officer effective 6^th May 2024 and the
appointment was approved by the shareholders at the
42^nd Annual General Meeting held on 22^nd July 2024.
Mr. L Ramkumar was appointed as a Non-Executive
Independent Director at the 42^nd Annual General Meeting
with effect from 24^thJuly 2024 for a term of three (3)
consecutive years. Mr. Shrinivas Govindrao Shirgurkar

retired as a Non-Executive Independent Chairman
effective close of business hours of 23^rd July 2024 on
completion of his term and Mr. Bhagya Chandra Rao was
appointed as a Chairperson of the Board effective 24^th July
2024.

The Board places on record its appreciation for the
services rendered by Mr. Shrinivas Govindrao Shirgurkar
and Mr. C Srikanth during their tenure of office as Directors
of the Company including as members of its various
Committees. The Board welcomed Mr. Ramkumar and
wished him well in his role as an Independent Director.

Consequent to the changes in the Board composition, the
constitution of Committees of the Board was reviewed and
revised more fully detailed in the Corporate Governance
section of the Report.

Mr. Sridharan Rangarajan retires by rotation at the
forthcoming Annual General Meeting and being eligible,
offers himself for re-appointment. A proposal for his re¬
appointment is included in the Notice convening the
43^rd Annual General Meeting for consideration and
approval by the shareholders.

The Company has received declarations from all its
Independent Directors confirming that they meet the
criteria of independence prescribed both under the
Companies Act, 2013 and the Listing Regulations. In the
opinion of the Board, all the Directors appointed during the
year are persons with integrity, expertise and possess
relevant experience in their respective fields.

All the Independent Directors of the Company have
registered their names in the Independent Directors Data
bank and had completed test/exempted as required under
the Companies Act, 2013 and the Rules referred therein.

KEY MANAGERIAL PERSONNEL (KMP)

Mr . Ninad Gadgil, Executive Director & Chief Executive
Officer, Mr. Mukesh Kumar Hamirwasia, Chief Financial
Officer and Mr. P Arjun Raj, Company Secretary are the
Key Managerial Personnel of the Company as per Section
203 of the Companies Act, 2013.

BOARD MEETINGS

A calendar of Board Meetings is prepared and circulated in
advance to the Directors.

During the year, nine (9) Board Meetings were convened
and held in accordance with the provisions of the Act. The
date(s) of the Board Meeting and attendance of the
directors are given in the Corporate Governance Report
forming an integral part of this report.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and
the Listing Regulations, the Board carried out an annual
performance evaluation of its own performance, the
Directors individually as well as the evaluation of the
working of its various Committees as per the evaluation
framework adopted by the Board on the recommendation
of the Nomination and Remuneration Committee.
Structured assessment forms were used in the overall
Board evaluation comprising various aspects of the
Board''s functioning in terms of structure, its meetings,
strategy, governance and other dynamics of its functioning
besides the financial reporting process, internal controls
and risk management. The evaluation of the Committees
was based on their terms of reference fixed by the Board
besides the dynamics of their functioning in terms of
meeting frequency, effectiveness of contribution etc.

Separate questionnaires were used to evaluate the
performance of individual Directors on parameters such as
their level of engagement and contribution, objective
judgement etc. The Executive Director''s evaluation was
based on leadership qualities, strategic planning,
communication, engagement with the Board etc.

The Chairman was also evaluated based on the key
aspects of his role. The performance evaluation of the
Independent Directors was carried out by the entire Board.
The performance evaluation of the Chairman, the Board as
a whole and the Non-Independent Directors was carried
out by the Independent Directors at their separate meeting
held during the year.

POLICY ON APPOINTMENT AND
REMUNERATION OF DIRECTORS

Pursuant to Section 178(3) of the Companies Act, 2013,
the Nomination and Remuneration Committee of the Board
has formulated the criteria for Board nominations as well as
the policy on remuneration for Directors and employees of
the Company.

The criteria for Board nominations lays down the
qualification norms in terms of personal traits, experience,
background and standards for independence besides the
positive attributes required for a person to be inducted into
the Board of the Company. Criteria for induction into Senior
Management positions have also been laid down. During
the year, the code of conduct and the criteria for Senior
Management was reviewed and amended in line with the
SEBI (Listing Obligation and Disclosure Requirements)
(Third Amendment) Regulations, 2024 dated 12^th
December 2024.

The Remuneration policy provides the framework for
remunerating the members of the Board, Key Managerial
Personnel and other employees of the Company. This
Policy is guided by the principles and objectives
enumerated in Section 178(4) of the Companies Act, 2013
and reflects the remuneration philosophy and principles of
the Murugappa Group to ensure reasonableness and
sufficiency of remuneration to attract, retain and motivate
competent resources, a clear relationship of remuneration
to performance and a balance between rewarding short
and long-term performance of the Company. The policy
lays down broad guidelines for payment of remuneration to
Executive and Non-Executive Directors within the limits
approved by the shareholders. Further details are available
in the Corporate Governance Report.

During the year, the Board Nomination Criteria and
Remuneration Policy was reviewed and amended in line
with the SEBI (Listing Obligations and Disclosure
Requirements) (Third Amendment) Regulations, 2024
dated 12^th December 2024.

The Board Nomination criteria and the Remuneration

policy are available on the website of the Company at
https://wendtindia.com/wp-content/uploads/2025/02/
criteria-for-board-nomination-2025.pdf and
https://wendtindia.com/wp-content/uploads/2025/04/
Remuneration-Policy.pdf

COMPOSITION OF AUDIT COMMITTEE

The Audit Committee of the Board comprises four
members out of which three (3) are independent.
Mr. L Ramkumar is the Chairman and other members are
Mrs. Hima Srinivas, Mr. Bhagya Chandra Rao and
Mr. Sridharan Rangarajan. During the year, six (6) Audit
Committee meetings were held, the details of which are
provided in the Corporate Governance Report.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013, read
with Companies (Cost Records and Audit) Rules, 2014 and
amendments thereof, the Company is required to maintain
cost accounting records in respect of products of the
Company covered under CETA category of Machinery &
Mechanical appliances. Further, the cost accounting
records maintained by the Company are required to be
audited.

The Board, on the recommendation of the Audit
Committee, re-appointed M/s. B Y & Associates (Firm No.
003498), Cost Accountants, Chennai to audit the cost
accounting records maintained by the Company under the
said Rules for FY 2024-25 at a remuneration of
Rs.1,00,000/-. Further, they have been re-appointed by the
Board to conduct the cost audit for the FY 2025-26 at an
enhanced remuneration of Rs. 1,10,000/- plus out of
pocket expenses incurred in connection with the audit.

The Companies Act, 2013, mandates that the
remuneration payable to the Cost Auditor is to be ratified by
the shareholders. Accordingly, a resolution seeking the
shareholders'' ratification of the remuneration payable to
the Cost Auditor for the FY 2025-26 is included in the notice
convening the 43^rd Annual General Meeting.

STATUTORY AUDITORS AND AUDITORS''
REPORT

In line with the requirements of the Companies Act, 2013,
the Company, with the approval of the shareholders at the
Annual General Meeting held on 22^nd July 2022,
re-appointed M/s. Price Waterhouse Chartered
Accountants LLP (Reg. No. FRN 012754N/ N500016)

(PW) as the Statutory Auditors of the Company to hold
office from the conclusion of 40^th Annual General Meeting
until the conclusion of the 45^th Annual General Meeting
(AGM).

As required under Regulation 33 of the Listing Regulations,
the Auditors have confirmed that they hold a valid
certificate issued by the Peer Review Board of the Institute
of Chartered Accountants of India.

The Report given by M/s. Price Waterhouse Chartered
Accountants LLP on the Financial Statements of the
Company for the year ended 31^st March 2025 is provided in
the financial section of the Annual Report.

There are no qualifications, reservations, adverse remarks
or disclaimers given by the Auditors in their report. The
auditors have commented on the availability of the audit
trail at the application level for modification to which the
Company''s response is as follows:

The Company is using SAP software for maintaining its
books of accounts. SAP software keeps a complete record
of all changes made to the system''s data for front-end
transactions, thereby audit trail is ensured. The Company
has already activated the audit trail at SQL Data base level
where it has started to capture all the logs. There is no
direct access for server and SQL database, other than
super admin, where evidences are stored. The activated
audit trails capture the login details and change logs at
frequent intervals to ensure that changes are captured in
the database level. Further, the audit trail has been
preserved by the Company as per the statutory
requirements for record retention. The Company has
initiated the migration to S/4 Hana where the audit trail
would be in-built with additional features.

During the year under review, the Auditors have not
reported any matter under Section 143(12) of the
Companies Act, 2013, and hence there are no details to be
disclosed under Section 134(3)(ca) of the Act.

There were no material changes or commitments affecting
the financial position after the end of the financial year and
date of this report.

SECRETARIAL AUDIT

M/s. Srinidhi Sridharan & Associates, Practicing Company
Secretaries, Chennai was appointed as the Secretarial
Auditor to undertake the Secretarial Audit of the Company
for the FY 2024-25. The report of the Secretarial Auditor for
year ended 31^st March 2025 is annexed to and forms part of

this Report as Annexure F. There are no qualifications,
reservations, adverse remarks or disclaimers given by the
Secretarial Auditor in the Report.

In line with the SEBI (Listing Obligations and Disclosure
Requirements) (Third Amendment) Regulations, 2024
dated 12^th December 2024, the Company is required to
appoint a Secretarial Auditor with the approval of the
Shareholders for a term upto five (5) years. Pursuant to
Regulation 24A of the Listing Regulations, the Board of
Directors at their meeting held on 23^rd April 2025, based on
the recommendation of the Audit Committee, have
recommended the appointment of M/s. Sridharan &
Sridharan Associates (Firm registration number:
P2022TN093500)to hold office for a term of five (5)
consecutive years from FY 2025-26 to FY 2029-30 at a
remuneration of Rs. 1,00,000/- excluding out of pocket
expenses incurred by them in connection with the Audit
and applicable taxes.

In terms of Regulation 24A of the Listing Regulations, there
is no material unlisted subsidiary incorporated in India.
Material unlisted subsidiary for the purpose of this
Regulation is a subsidiary whose turnover/net worth
exceeds 20 per cent of the consolidated turnover/net worth
respectively of the Company and its subsidiaries in the
immediately preceding accounting year. Hence, the
requirement prescribed under Regulation 24A of the
Listing Regulations is not applicable to the Company, in so
far as material subsidiary is concerned.

SECRETARIAL STANDARDS

The Company is in compliance with the Secretarial
Standard on Meetings of the Board of Directors (SS-1)and
Secretarial Standard on General Meetings (SS-2).

COMPLIANCE MANAGEMENT

The compliance management system tracks compliances
across the Company and has a comprehensive coverage
of the various applicable laws including auto updation
based on the regulatory changes from time to time.

CORPORATE GOVERNANCE

In terms of Regulation 34(3) read with Schedule V of the
Listing Regulations, a separate section on Corporate
Governance including the certificate from a Practicing
Company Secretary confirming compliance is annexed to
and forms an integral part of this Report.

CEO/CFO CERTIFICATE

Mr. Ninad Gadgil, Executive Director & Chief Executive
Officer and Mr. Mukesh Kumar Hamirwasia, Chief
Financial Officer have submitted a certificate to the Board
on the integrity of the financial statements and other
matters as required under Regulation 17(8) of the Listing
Regulations.

VIGIL MECHANISM UNDER WHISTLE
BLOWER POLICY

The Company has a well-established whistle blower policy
as part of vigil mechanism for Directors and employees to
report concerns about unethical behavior, actual or
suspected fraud or violation of the Company''s Code of
conduct or ethics policy. This mechanism also provides for
adequate safeguards against victimisation of
Director(s)/employee(s) who avail of the mechanism and
provides for direct access to the Chairman of the Audit
Committee in exceptional cases. The Whistle blower policy
is available on the Company''s website at
https://wendtindia.com/wp-content/uploads/2024/08/
Whistle-Blower-Policy Wendt.pdf It is affirmed that during
the year, no employee was denied access to the Audit
Committee.

ANNUAL RETURN

The Annual Return in Form MGT-7 is available at
https://wendtindia.com/wp-
content/uploads/2025/06/Annual-Return-Form-MGT-
7.pdf

D I R E C T O R S '' R E S P O N S I B I L I T Y
STATEMENT

Pursuant to the provisions of Section 134(3)(c) of the
Companies Act, 2013, the Board, to the best of its
knowledge and belief and according to the information and
explanations obtained by it confirm that:

• in the preparation of the annual accounts for the
financial year ended 31^st March 2025, the applicable
accounting standards have been followed and there
have been no material departures from the same;

• they have selected appropriate 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 as at the end of the financial year and of the

profits of the Company for that period;

• proper and sufficient care has been taken for the
maintenance of adequate accounting records in
accordance with the provisions of the Companies Act,
2013, for safeguarding the assets of the Company and
for preventing and detecting fraud and other
irregularities;

• the annual accounts have been prepared on a going
concern basis;

• proper internal financial controls have been laid down
to be followed by the Company and that such internal
financial controls are adequate and were operating
effectively;

• proper systems have been devised to ensure
compliance with the provisions of all applicable laws
and that such systems were adequate and operating
effectively;

ENERGY CONSERVATION, TECHNOLOGY
ABSORPTION AND FOREIGN EXCHANGE
EARNINGS & OUTGO

The information on energy conservation, technology
absorption, expenditure incurred on Research &
Development and forex earnings/outgo as required under
Section 134(3)(m) of the Companies Act, 2013, read with
Rule 8 of the Companies (Accounts) Rules, 2014 is
annexed to and forms part of this Report as Annexure A.

SIGNIFICANT AND MATERIAL ORDERS
PASSED BY THE REGULATORS OR
COURTS

There are no significant and material orders passed by the
regulators or courts or tribunals impacting the going
concern status of the Company and its future operations.

PARTICULARS OF EMPLOYEES

The information on employees and other details required
to be disclosed under Rule 5 of the Companies
(Appointment and Remuneration of Managerial
Personnel) Rules, 2014 is annexed to and forms part of
this Report as Annexure D.

OTHER CONFIRMATIONS

No application under the Insolvency and Bankruptcy
Code, 2016 (IBC) was made on the Company during the
year. Further, no proceeding under the IBC was initiated
or is pending as at 31^st March 2025. There was no instance
of one-time settlement with any Bank or Financial
Institution.

ACKNOWLEDGMENTS

The Board gratefully acknowledges the co-operation
received from various stakeholders of the Company viz.,
customers, suppliers, partners, banks, government and
other statutory authorities, auditors, business associates
and shareholders. The Directors extend their gratitude to
all the regulatory agencies like SEBI, Registrar of
Companies, Stock Exchanges and other Central and
State Government authorities/agencies, vendors and
sub-contracting partners for their support. The Board also
acknowledges the unstinted co-operation, commitment
and dedication made by all the employees of the
Company in the previous financial year.

The Directors also wish to place on record their gratitude
to the members of the Company for their unrelenting
support & confidence.

On behalf of the Board
For Wendt (India) Limited

^{New York} Bhagya Chandra Rao

April 23, 2025 Chairman

---

Mar 31, 2024

The Directors have the pleasure in presenting the 42^nd Annual Report of Wendt (India) Limited (hereinafter referred to as ''the Company'') together with the Audited Financial Statements for the year ended 31^st March 2024. The Management Discussion & Analysis Report which is required to be furnished as per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as ''the Listing Regulations'') has been included in this Report to avoid duplication and overlap.

ECONOMIC OVERVIEW

The world continued witnessing unprecedented challenges in FY 2023-24 in terms of Russia-Ukraine conflict, conflict in middle east, geopolitical uncertainties, China-America cold war, rising fuel and commodity prices which had a toll on the global economic situation.

As per the latest World Economic Outlook released by the International Monetary Fund (IMF), the global economic growth is expected to be slightly better in 2024 at 3.1% i.e. 0.2% higher than the previous release. While the IMF Report estimates softer landing in the advanced economies, lagged impacts of the quantitative tightening and inflation remaining above trade and slow recovery in services trade. Global commodity prices weakened in 2023 but remained above pre-pandemic levels.

India remained resilient throughout 2023 despite the challenging global environment. India continues as the fastest growing economy amongst major economies with a fundamentally sound growth story. India has solidified its position as the world''s third-largest fintech economy, following only the USA and the UK. This success is credited to both domestic and international investor interest, along with sustained IPO activity. As per first advance estimate of national income, Gross Domestic Product (GDP) growth is projected at 7.3% in financial year FY24 on YoY basis, with 7% growth expected in second half. This strong growth of GDP was mainly propelled by large government expenditure on demand side. There was approximately 31% YoY increase in Central Government capital expenditure (capex) and 43% increase in State Government capex during April-November 2023.

On the supply side, mining, manufacturing, construction and certain services emerged stronger. Mining sector benefitted from policy reforms, increased domestic and global demand and rising prices which led to robust production of several minerals including coal, natural gas and iron ore. The strong growth in manufacturing was driven mainly by easing of global commodity prices across energy, metal and food categories, which boosted profitability of manufacturing firms. Construction sector gained from higher government capex and an increase in Economic outlook demand for office spaces and housing, especially in urban areas. Additionally, financial, real estate and professional services are expected to witness robust growth, likely due to buoyant bank credit growth, strong demand for real estate especially in

urban areas and growth in professional services, especially global capability centers in India. However, growth in private consumption is continuing to show weakness with the first advanced estimate pegging it at 4.3%. This has been due to rural stress from uneven rains, inflation and income stress in low to middle income households. High frequency indicators also suggest that consumption demand is not yet broad based and largely driven by urban consumption and high-income households. In addition, private investment also did not pick up strongly during the year and exports remained muted due to global economic slowdown and geopolitical volatility.

Global economic growth is expected to slow down in 2024, mainly due to lagged impact of monetary tightening, fiscal consolidation, reduced savings buffers and waning pentup demand for services. However, the latest World Economic Outlook released by IMF states that the economy may perform better than was earlier estimated. Global growth is likely to pick up in 2025 based on declining inflation and more supportive monetary policy in the long run. Global crude oil prices are expected to ease in 2024 based on subdued global growth and improvement in oil supply from non-OPEC countries subject to geopolitical risks not escalating. Global trade can gain some strength in 2024 compared to 2023 based on slow recovery of demand for goods especially in advanced economies in the second half of FY 2023-24. For India, the economic growth in FY 2024-25 will continue to be driven by government capex and revenue expenditure in the first half. Private investment can pick up in second half of FY 2024-25 if the agricultural output is stronger with fading El Nino, thus leading to broad based consumption revival. The bond markets will get support and cost of borrowing is likely to go down with fiscal

argets in most of the economies will continue to create leadwinds for growth. As per World Bank Report, lobal Trade growth in 2023 was amongst the slowest n the past 50 years, with contraction in merchandise

While industry leaders can afford significant research operations, most unorganised players do not have access to substantial R&D resources. This disparity can make it difficult for small and medium-scale companies to compete in the market, in terms of developing products that may require advanced technologies. However, the global companies are setting up manufacturing base in India.

The Company being a total Grinding Solution provider,

innovation is at the core of the Company''s products and processes. As such majority of our products are customised to fulfil the customer''s requirements.

The Company is a preferred supplier for many of the automobile, auto component, engineering, aerospace, defense, ceramics customers for their Super Abrasive Tooling solutions, Grinding & Honing Machines and Precision components. A major contribution to the Company''s revenues comes from these industries.

© COMPANY PERFORMANCE OVERVIEW (STANDALONE)			(Rs. in lakhs)
	FY 2023-24	FY 2022-23	% change
Domestic Sales	15682	13783	14%
Export Sales	4944	5312	-7%
Total Sales	20626	19095	8%
EBITDA	5378	5372	-
Other Operating and Other Income	919	956	-4%
Profit Before Tax	5233	5250	-
Profit After Tax	3950	4012	-2%
Capital Employed	19201	16933	13%
Earnings per Share - Rs.	197.49	200.58	-2%

deficit target set at 5.1% and gross borrowings in FY 2024-25 estimated lower than FY 2023-24 will help bond markets with cost of borrowing going down. The private sector can then commence its investment cycle with their deleveraged balance sheets and the support of banks with historically low nonperforming assets.

Though India is better placed than its global peers, the path to sustained recovery, however, will be distorted, given three major challenges India is likely to face. First, inflation is likely to remain high in the coming year even though it has already peaked. This also depends on the rainfall during the coming monsoon and the resultant surplus income with the rural folks to spend on capital goods; Second, aggressive tightening of monetary policies across the central banks of the advanced economies has led to global slowdown in 2023, impacting domestic investment and consumer demand as the propensity to save increases. Tighter liquidity conditions may further result in capital outflows. Third, the labour market reforms are yet to happen, and the rising unemployment rate is a matter of concern. These factors could derail the strong recovery in consumer demand and service sector both of which are critical to GDP growth. In short, FY 2024-25 will be a challenging year as the General elections are due and the formation of a new government which is expected to continue the reform momentum in the future.

M INDUSTRY STRUCTURE & DEVELOPMENTS

The demand for Super Abrasive products is closely linked to the level of industrial production. Super Abrasives are used to manufacture long-lasting, expensive items like auto and aircraft parts, demand for which is highly cyclical. Diamond and Cubic Boron Nitride (CBN) Super Abrasive products are used extensively in aerospace industry and other industrial applications where price considerations are less significant as they incur high initial costs. They are used in the machining of materials such as nickel, cast iron and cobalt-based super alloys, where precision in machining operations is of prime importance.

Increasing complexity of Super Abrasive technology in high performance applications and its high initial cost provide entry barriers for small-scale and medium-scale companies to compete with the global market leaders.

During the year the Company recorded its highest ever sales of Rs.20626 lakhs, higher by 8% per cent over the previous year.

Super Abrasive Business

The Super Abrasive Business comprising Diamond/CBN Grinding Wheels in various Bonding Systems, Rotary Dressers, Stationary Dressers, Hones and Segmented products is the biggest business vertical of the Company. The Company continues to take several initiatives including product development, new customer acquisition, price correction, horizontal deployment of successful applications and products, new markets, leveraging all its products as a complete package solution to serve customers better, etc., to grow the Super Abrasive Business.

The Super Abrasive Business achieved sales of Rs.13161 lakhs, which is lower by 2% over the previous year.

The Domestic Super Abrasive Business sales grew by 7% over last year. This is the highest ever sales for Domestic Super Abrasive Business. The higher sales was from industries like auto, auto ancillaries, steel, bearings, engineering, cutting tools etc. The sales growth was recorded in select products. Some of the initiatives for

identifying, targeting and onboarding new distributors, including industry specific distributors like glass, aerospace, steel in targeted countries, horizontal deployment of successful applications and products, dedicated customer meetings/calls, enhanced use of digital media, e-commerce, technical webinars, social media posts, marketing campaigns and participation in international exhibitions in focus countries etc.

Machines Business

Machine tool sales comprises of sales of machines both domestic and export, spares and service and refurbishing of old machines. In the Machines Business, sales was Rs. 4732 lakhs, a growth of 70% over the previous year. The Machines Business recorded its

higher sales are close working on product development, key account management for top customers, appointment of precision dealers, horizontal deployment of successful applications, application teams support to the sales team and new product launches etc.

The Export Super Abrasives sales during the year was lower by 19% over the previous financial year. The lower exports were due to reduced off take from key customers from few countries. The volatile geopolitical scenario with continued Russia-Ukraine and Israel-Palestine conflict led to economic instability and changes in global trade route leading to lower off take from Europe and other developed countries. The China plus one strategy adopted by major economies with localisation led to reduced demand and continued economic depression. The Company is focusing on for highest ever sales despite continued supply chain issues owing to global shortage of semi-conductor chips and other related parts which go into the manufacturing of machines. The timely execution and delivery of machines to various customers was ensured by better planning, bulk ordering of some of the critical parts for the year, working closely with critical vendors and developing alternate vendors. The initiatives like advance schedule release helped to execute delivery on time. Further, other initiatives like design for parts standardisation, dynamic contract reviews and micro level planning, senior management interaction and visits to major suppliers, application demonstration and improving operational efficiency through Total Employee Involvement (TEI), relay-out of shop to increase the number of assembly bays, cost optimisation etc., also helped in meeting the plan.

During the year, the Company manufactured 45 machines. The industry-wise Machine sales during last year comprises majority to steel followed by cutting tools, engineering and auto. The Company executed several new machines during the current year which was well accepted by the customers. The Company''s strategy of moving from industry specific to application-based machines has yielded good results during the year. These machines have been well received by the customers, projecting a good performance. Machine sales in the export market achieved good growth and acceptance by the customers.

Precision Products

The Precision Products business clocked sales of Rs. 2733 lakhs, lower by 5% over the previous year. The precision components sales was impacted during the previous year due to schedule deferment and lower volume off take by end customers. Besides, delays in establishing new products also added to the lower sales.

The Company continues to focus on developing new products for its components business as a part of its de-risking strategy and looking at alternate opportunities wherever possible.

Digital Marketing

The Company has uploaded its new products and applications on social media platforms like LinkedIn,

YouTube etc., to create awareness amongst its customers. The Company had launched its new website during the FY 2021-22 with modified and improved content for better interaction and engagement with the customers. The website''s look and feel has been enhanced with graphics and user interface. The customers can choose the Company''s products and successful applications and place their order online. These initiatives are focused on Digital Marketing and ease of doing business in terms of servicing customers better.

SlTr. .

[W1 Information Technology

On the Information Technology side, the Company had achieved some success in the Digitisation initiative of its core processes during the previous year for ease of doing business and eliminate duplication and nonvalue additions. Phase 1 and 2 of Vendor portal has been implemented and around 40% of vendors have been on boarded. This portal will improve communication between the vendor and the purchase team of the Company by providing visibility to the vendors on Request for quote raised, purchase order acceptance, tracking of materials and order status. The Company implemented CRM Application-standard module to achieve better engagement with the key customers and key account and capture significant data related to customers, industry and the market. Besides, digitisation of Hire to retire function through ESS Portal is underway which is expected to ease the human resource function.

Exhibitions and Seminars

During the year, the Company participated in several exhibitions to showcase its products and to build rapport with customers. Some of the exhibitions where the Company participated in and displayed its products are IMTOS Delhi, Texibition 2023, Indomach Hyderabad, Engimach Exhibition Gandhinagar, Steel Expo Raipur etc. Besides, the Company also conducted several Technology Days and technical seminars at various customer places to educate the customer on our products and applications and to minimise their issues. Besides, the Company completed building Dashboard for trial and application establishment,

preparation of Data Bank of all products, applications, customers based on their potential and market size and case studies of successful applications.

The Company leverages its core strength like complete product range- Super Abrasives, Machine Tools and Precision Components with access to German technology, renowned global brand ''Wendt'', global connect, domain knowledge and continued patronage from customers to grow its business and serve its customers better. It continues its focus on exploring new business opportunities in Aerospace, Compressor & Hydraulic parts, Special Inserts, Carbide industry, deploying its core competencies - Expertise, Experience and Knowledge on Grinding, Machines & Super Abrasive Tools for producing related precision components.

Manufacturing

The Super Abrasives manufacturing had been regrouped as Bonded and Coated. There was successful development of new products in Vitrified cell and Quantapole Hybrid wheels which resulted in higher revenue. The successful running of QRM aligned manufacturing layout for some cells resulted in higher production. To ensure optimum usage of resources and attain cost leadership, three shifts operations were started in majority of Super Abrasives manufacturing cells. Successful pilot implementation of Dynamic Buffer Management (DBM) in Resin Bond ensured that there was no loss of production due to timely raw materials planning based on the lead time. Diamond hand setting automation is one of the areas of successful implementation.

Focus on Process Efficiency

The Company continues to focus on improving operational efficiency as well as optimal utilisation of various resources-man, material and machines in manufacturing and production areas. The Company has implemented various initiatives to improve efficiency of its processes and products. Some of the key ones are-

• The QRM (Quick Response Management) Initiative Paired cell Overlapping Loops of Cards with Authorisation (POLCA) which was started as a pilot in the earlier years has been deployed successfully in three of the production cells. This envisages reorganising the machine layout in the shopfloor thereby reducing lead-time/waiting time between workstations and improvement in shopfloor inventory and other resources. This initiative is beneficial in addressing some of the key areas like planning and scheduling, production reliability, materials availability, and product delivery. This needs to be extended not only in manufacturing process but also in support functions.

• Reliability on Product Delivery (ROPD)

improvement in product delivery for all major cells through POLCA.

• Loss reduction in major cells through Cross Functional Teams (CFT) to reduce in process rejections.

• Method Engineering- CFT to work on Methods improvement through productivity enhancement projects, automating repetitive and manual tasks, value engineering, process simplification and eliminating redundancies or NVAs, flexible

manufacturing and capacity utilisation ensuring all resources are utilised to the optimum. The Company had adopted cost leadership strategy to achieve a competitive advantage by producing goods at lowest possible cost. This envisages identifying the cost drivers, re-engineering the existing processes to remove redundancies and NVAs, streamlining outsourcing activities, creating economies of scale and focus on the core competencies. With this objective, the engineering team has undertaken some projects in both bonded and coated cells to eliminate, combine, rearrange and simplify processes and achieve cost reduction. The preliminary results are encouraging and it will be extrapolated for higher value in future.

Supply Chain efficiency is one of the Company''s key focus areas. The Company continues its focus in reducing product lead time and improving operational efficiency by reducing Work in Progress (WIP).

On the raw materials front, the Company continuously develops alternative, reliable and competitive sources/suppliers for critical raw materials including Diamond/CBN, machine castings, systems, electrical, chemicals etc. However, to mitigate supply chain disruption, the Company has tied up with critical suppliers with annual orders delivery schedules.

F! FUTURE PROSPECTS AND OUTLOOK

India''s GDP is expected to grow to USD 7.5 trillion in 2030 from present USD 3.5 trillion in 2023. This implies India adds another India in 7 years and become the Manufacturing Hub for the World. This is a big positive

for India as none other economy in the world has such high growth rate. India has the following advantages to capitalise on this unique opportunity: the potential for significant domestic demand, the Indian Government''s drive to encourage manufacturing, and with a distinct demographic edge, including considerable proportion of young workforce. The Government''s push to sectors like roads, railways and metro rail, urban transport, ports, inland waterways and airports, renewable energy (based on India''s commitment to Net Zero by 2070), Green infrastructure in terms of green hydrogen, EV and thrust to defence production and exports is expected to boost domestic manufacturing.

The Company''s products are used extensively for Auto, Auto Ancillaries, Engineering, Cutting Tools, Steel, Ceramics, Refractories, Defence, Aerospace, Construction and other industry segments. As such the Company closely monitors the developments in these sectors and accordingly devises its business strategy.

In the Auto Ancillary segment, rising middle class income and huge youth population in India is expected to be key demand driver. The Indian passenger car (PV) market was valued at USD 32.70 billion in 2021, and it is expected to reach a value of USD 54.84 billion by 2027 while registering a CAGR of over 9% between 2022-27. Indian automotive industry is targeting to increase the export of vehicles by five times during 2016-26.

The global EV market was estimated at approximately USD 250 billion in 2021 and it is projected to grow by 5 times to USD 1318 billion by 2028.

India could be a leader in shared mobility by 2030, providing opportunities for electric and autonomous vehicles. With the continued emphasis on green planet and reducing carbon emission, focus is shifting to Electric Vehicles (EV). The EV industry is expected to create 5 crores jobs by 2030 {Indian Brand Equity Foundation (IBEF)}. India enjoys a strong position in the global heavy vehicles market as it is the largest tractor producer, second-largest bus manufacturer, and third-largest heavy truck manufacturer in the world. Further, initiatives like the PLI schemes for automobile and auto components, Automotive Mission Plan 2026, vehicle scrap page policy, flexi fuels etc., is expected to provide growth opportunities to the automobile sector.

The EV market is estimated to reach Rs.50,000 crore (USD 7.09 billion) in India by 2025. A study by CEEW Centre for Energy Finance recognised a USD 206 billion opportunity for electric vehicles in India by 2030. This will necessitate a USD 180 billion investment in vehicle manufacturing and charging infrastructure.

With regards to the Steel industry, India''s finished steel consumption is anticipated to increase to 230 Million Tonnes (MT) by FY 2030-31 from 119 MT in FY 2022-23. India is the world''s second-largest producer of crude steel, with an output of 125.32 MT of crude steel and finished steel production of 121.29 MT in FY 2022-23. India''s steel production is estimated to grow 4-7% to 123-127 MT in FY 2023-24 and exceed to 300 million tonnes by 2030-31. The growth in the Indian steel sector is driven by the domestic availability of raw materials such as iron ore and cost-effective labour. Consequently, the steel sector has been a major contributor to India''s manufacturing output due to the

Government''s continued thrust on infrastructure development including building railways, roadways and highways etc., and the demand for Indian steel is expected to increase further.

Indian Abrasives market is valued at USD 363.26 million in 2021 and is expected to project a robust growth with a CAGR of 6.61% to reach USD 541 million by FY 2026-27. Initiatives like ''Smart Cities Mission'' and ''Housing for All'' along with rising demand for electronics and automobiles are driving the growth of Indian Abrasives market.

The global Super Abrasives market is estimated to grow at a CAGR of 6.78% to USD 14.45 billion (Rs. 11.82 trillion) during 2021-2030. The dominating region is the Asia Pacific with major countries being China, India, Japan, South Korea and other regions being North America-US, Canada, Europe -Germany, UK, France, Italy etc. The largest segment of Super Abrasives market is the diamond segment accounting to 67% out of which the largest market is the electroplated diamond. By the end user industry, the electronic segment has the highest demand of Super Abrasives occupying 49% market share followed by automotive and oil and gas, which accounted for 14% and 10% market share respectively. Major factors responsible for the growth of global Super Abrasives market include growing awareness for adoption of high-end technologies and their benefits coupled with the continuing growth of the automotive industry. Besides, the product is widely popular due to its long life cycle, high scale hardness and superlative performance, which is anticipated to spur the global Super Abrasives market growth.

The expected growth of the above sectors provides good opportunities for the Company''s products - Super Abrasives, Machines, and Precision Components in future.

The Company''s growth lies in constantly monitoring changes in the external environment and adapting to the emerging customer needs. Accordingly, mega trends and underlying new opportunities that unfold are being tracked continuously.

The growing usage of Super Abrasive products for various medical applications such as Surgical Instruments, Hypodermic Needles, Dental implants, Knee, Hip and Shoulder joints create new opportunities for the Company to explore through technical collaboration and new products development. Also, growing Consumer Electronic Segment with manufacturing facilities in India is expected to provide a wide array of opportunities for consumption of Super Abrasives in the coming years. The focus on

semi-conductor industry which will make India a major hub for manufacturing semiconductors is expected to be a major growth engine. The success of addressing these sectors lies in the technology which the Company is exploring through necessary tie-ups and collaboration.

rPn SUBSIDIARY COMPANY

BHH

Wendt Grinding Technologies Limited, Thailand

The Company''s wholly owned subsidiary, Wendt Grinding Technologies Limited, Thailand, (the Subsidiary) achieved sales of Thai Baht 913 lakhs (Rs. 2146 lakhs) which is 5% higher than last year. This is

KEY CONSOLIDATED FINANCIAL SUMMARY			(Rs. in lakhs)
	FY 2023-24	FY 2022-23	% change
Sales	22482	20761	8%
EBITDA	5564	5616	-1%
Other operating and other Income	913	762	20%
Profit Before Tax	5421	5302	2%
Profit After Tax	4095	4009	2%
Earnings per share - Rs.	204.77	200.45	2%

despite unprecedented challenges and industry slowdown on account of EV impetus, geopolitical uncertainties due to anti-China thrust and China -Taiwan relations, rising costs and all odds. The Subsidiary continues to demonstrate its strong resolve and business acumen challenging the unfavorable conditions and churning out results on a consistent basis.

The Profit Before Tax was Thai Baht 87 lakhs (Rs. 205 lakhs), 25% lower than previous year and the Profit After Tax has been Thai Baht 70 lakhs (Rs. 164 lakhs), 24% lower over previous year.

During this challenging year, the Subsidiary resorted to strict cost and receivables control, clear business focus in terms of increasing product and customer basket and strengthening the export business. These initiatives have helped in de-risking the business by compensating for the decline in existing products. Focus on providing value added services, enhancing product basket, new customer additions and entering new geographies have yielded desirable results.

The Subsidiary will continue to focus on core business & value-added service and increased customer/product base along with measures to ensure OPEX, safety and cash flow to achieve sustainable & profitable growth.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company for the financial year 2023-24 are prepared in compliance with the applicable provisions of the Companies Act, 2013, Accounting Standards as prescribed by Regulation 33 of the Securities and Exchange Board of India (SEBI) (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Consolidated Financial Statements have been prepared based on the audited financial statements of the Company and its subsidiary, as approved by their respective Board of Directors.

Pursuant to provisions of Section 136 of the Act, the Financial Statements of the Company, the Consolidated Financial Statements along with the relevant documents and the Auditors'' Report thereon form part of this Annual Report. A statement of summarised financials of all subsidiaries of the Company in form AOC-1 forms part of the Annual Report. The audited annual accounts and related information of the subsidiaries is available on our website www.wendtindia.com.

(?^ DIVIDEND

Considering the past dividend pay-out ratio and the current year''s operating profit, the Board has recommended a final dividend of Rs.20/- per equity share of Rs.10/- each for the year ending 31^st March 2024. Besides, in January 2024, an interim dividend at the rate of Rs. 30/- per equity share of Rs.10/- each was declared and paid in February 2024. This aggregates to a total dividend of Rs.50/- per equity share of Rs.10/-each.

The Company has adopted the Dividend Distribution Policy as approved by the Board in line with the Listing Regulations and the same is available on the Company''s website https://wendtindia.com/wp-content/themes/wendtindia/pdf/dividend-distribution-policy.pdf

The objective of this policy is to establish the parameters to be considered by the Board of Directors of your Company before declaring or recommending dividend.

The interim dividend paid in February 2024 and the proposed final dividend for the year ended 31^st March 2024 are in line with this policy.

(£?} TRANSFER TO RESERVES

The Company transferred Rs.395 lakhs to the General Reserve. An amount of Rs.11729 lakhs is retained in the Statement of Profit & Loss.

APPROPRIATIONS	(Rs. in lakhs)
Appropriations
Profit After Tax	3950
Add: Other Comprehensive Income	(82)
Add: Balance brought forward from previous year	9856
Total	13724
Recommended appropriations
Transfer to General Reserve	(395)
Dividend -Final (Dividend paid for 2022-23 Rs. 50/- per share of face value of Rs. 10/- each)	(1000)
Dividend -Interim (Dividend paid for 2023-24 Rs. 30/- per share of face value of Rs. 10/- each)	(600)
Balance carried forward	11729

(Rs. in lakhs)
Description		As on 31.03.2023		Movement (net of deletions)		As on 31.03.2024
Loans given by the Company		-		-		-
Corporate Guarantee given by the Company		-		-		-
Investments made by the Company		277		-		277
Current Investments: Investments in Mutual Funds as on 31.03.2024 was Rs.6831 Lakhs.
KEY RATIOS
Sl. no.	Ratios		In terms of		31.03.2024	31.03.2023
1.	Performance Ratios
a.	Operating Profit / Net Sales		(%)		22	24
b.	EBIDTA / Net Sales		(%)		29	32
c.	PBIT / Net Sales		(%)		25	28
d.	Net Profit / Net Sales		(%)		19	21
e.	Return on Capital employed		(%)		27	31
f.	Return on Equity		(%)		22	26
g.	Fixed Asset Turnover Ratio		Times		3.58	3.50
2.	Activity Ratios
a.	Inventory Turnover Ratio		Days		58	55
b.	Receivable Turnover Ratio		Days		79	67
3.	Liquidity Ratio
a.	Current Ratio		Times		2.37	2.07
There is no significant change in the ratios and the decrease in Return on Equity (Return on Networth) is on account
of lower Profit after tax (PAT) during the year.

csr£ CORPORATE SOCIAL RESPONSIBILITY

(CSR)

The Company believes that social responsibility is not just a corporate obligation that has to be carried out, but an opportunity to make a difference. All our CSR programs are aimed at inclusive growth and sustainable development of the community.

The Company''s Corporate Social Responsibility pursuits have always been based on the foundation of ethical behavior in all its business transactions and contributions for economic development extending to the local communities and the society at large. The Company, being a part of the Murugappa Group, has been upholding this tradition by allocating a part of its profits for fulfilling its social responsibilities. The Group''s philosophy is to serve the communities in which it operates through the services of service-oriented philanthropic institutions with education and healthcare being the core focus areas.

The Company''s Skill Development Program was set up in 2012 in collaboration with Carborundum Universal Limited. The major focus was to provide high quality vocational and technical training to less privileged youth from weaker sections of society by uplifting their

lives and equipping them with employable skill sets. This training program is designed based on the coaching methodology defined by Government of India, Ministry of Skill Development and Entrepreneurship. This builds up a skill bank of technically competent and industry ready work force benefitting the less privileged sections of society.

The three-year training program is based on the National Council of Vocational Training syllabus. This training is imparted with stipend to the enrolled students and free boarding facilities ensuring that they earn while they learn. Not only does this initiative help in imparting formal education, but also helps them in honing them to become a valuable citizen while helping them in seeking gainful employment upon successful completion of the course.

During the year, the Company undertook projects for promotion of education including construction of class rooms for a Government High School in Zuzuvadi, provision of potable drinking water systems (RO Purifier), providing Smart board for classes, Class room desks, Library furniture, CCTV Setup, Public Address system, Table & Chairs for teachers, Xerox machine to various Government Schools around Hosur plant location. The Company focuses its CSR activities on rejuvenating schools as most of the schools are in yearning need of an overhaul and lack even the most basic facilities.

The CSR projects were also focused on promotion of healthcare encompassing contribution of essential medical equipment and hygiene items to the Government Hospital and Urban Primary Health centre in Hosur. The Company focuses on the Government Hospitals as they lack basic infrastructure and medical equipments for the treatment of poor and needy patients from nearby rural and remote locations.

The Company gives importance to green environment and tree plantation in the nearby communities by

distributing and planting free saplings every year. Employees are encouraged to participate in activities like blood donation camps, creating awareness on road safety, nominating employees with RTO as traffic wardens, 5S campaigns towards cleaner environment, imparting special education to the school children to name a few.

The Company, in line with the amendments in Companies Act, 2013, formulated annual action plan, which was approved by the Board of Directors, in pursuance of the CSR Policy of the Company, based on which spending on CSR activities were executed. The Company, during the year 2023-24 has spent Rs.71 Lakhs on CSR activities and no amount remain unspent as at the end of the year. Further, the unspent CSR amount of Rs.12 Lakhs pertaining to the on-going project of construction of classroom in Zuzuvadi which was transferred to the Unspent CSR account previous year pursuant to section 135(6) of the Companies Act, 2013 was also spent during the year on the project.

In accordance with requirements of the Companies Act, 2013, the Company has a CSR policy incorporating the requirements therein which is also available on Company''s website at the following link https://wendtindia.com/wp-content/themes/wendtindia/pdf/csrpolicv.pdf.

The Annual Report on CSR activities in the prescribed format is annexed herewith as Annexure C.

$ TRANSFER TO THE INVESTOR EDUCATION & PROTECTION FUND (IEPF)

In terms of Section 124 (5) of the Companies Act, 2013, an amount of Rs.5,09,350 being unclaimed dividend during the year, pertaining to the Final dividend for the FY 2015-16 (Rs.3,12,810) and the Interim Dividend of FY 2016-17 (Rs.1,96,540) was transferred to IEPF after sending due reminders to the shareholders.

i®i FIXED DEPOSITS

The Company has not accepted deposits from the public falling within the ambit of Section 73 of the Companies Act, 2013 and the rules framed thereunder, and no amount of principal or interest was outstanding as on the balance sheet date.

^ LOANS AND INVESTMENTS

Particulars of Loans, Guarantees and Investments covered under section 186 of the Companies Act, 2013 are given below. There were no loans or guarantees covered under section 186 granted during the year.

% QUALITY

The Company follows a quality assurance system with stringent tests built into every stage of production ensuring the quality of its products. The quality consciousness built in the Company''s DNA backed by a thorough understanding of customer application needs and "one to one" customer support, has made the Company a synonym for quality and reliability. The product quality was enhanced by introducing Gemba inspection and risks were reduced resulting in improvement of production efficiencies thereby garnering customer loyalty, ensuring that Process &

the significance of safety amongst employees and visitors including by way of setting up of safety training kiosk.

The Annual medical check-up facility continues to assess the health status and risk of our employees. Employees benefitted from awareness sessions organised on the theme- FHH (Fitness, Health and Happiness) and employees were encouraged to take initiatives to improve their health and fitness.

Quarterly mock drills for fire safety, special medical attention for employees working in special process & sensitive areas, use of personal protection equipment (PPEs), zero discharge of ETP/STP and hazardous waste handling are some of the initiatives, which the Company continued to undertake during this year.

H RECOGNITIONS AND AWARDS

The Company encourages its employees to participate in customer audits, group competitions, various national and international events & competitions. During the year, the Company received many awards and accolades from well recognised organisations,

Product audits are being performed and regular testing of the product and ensuring that the quality is within the standard.

The Company has implemented ''Green Channel Suppliers & Vendors'' which will eliminate incoming inspection thereby reducing production lead time & faster customer delivery. The Green channel suppliers are selected after assessment and evaluation of their processes and facilities. The Company continued planned supplier audits for assessing supplier gaps if any thereby improving incoming materials'' quality performance. The Company also introduced Quality assurance agreements with suppliers which will help suppliers to understand their roles, responsibilities, and expectations.

The Company has certifications of ISO 9001: 2015, ISO 14001: 2015, ISO 45001: 2018, EN9100: 2018, IATF 16949: 2016 and EN 13236: 2019 reinforcing its commitment to ensure that Quality Management Standards are met.

IATF 16949: 2016 pertains to manufacturing of precision products and EN9100: 2018 pertains to Aerospace applications. In order to comply with the safety norms and requirements of overseas customers, the Company has successfully renewed ISO 9001: 2015, IS0 14001: 2015, ISO 45001: 2018, EN9100: 2018 and IATF 16949: 2016 Standards during the year and re-certified for EN13236: 2019. Quality being the uncompromised differentiator, the Company aims to ensure that product quality is built by deploying and embracing effective quality control management, process robustness, quality assurance and discipline at every stage of material flow.

££,,§ SAFETY, HEALTH AND ENVIRONMENT (SHE)

Safety continues to be the key area of focus for the Company. Behavior based training both in person as well as virtually were conducted to promote a culture of safe working. The Company recognises the need and is committed to providing Safe, Healthy and Socially Accountable Work Culture in the Organisation.

All personnel on a periodical basis receive effective health and safety training, including on-site training, job specific training etc. During the year, the Company has provided trainings for creating awareness about

establishments and certifying bodies for various distinctive achievements. Needless to mention that these recognitions and accolades enhance the passion and optimism among the employees and act as key motivator for the Company as a whole. Some of the key recognitions received during the year are as follows:

• ICAI Silver Award for Excellence in Sustainability Reporting (BRSR) FY 2022-23

The Company''s Business Responsibility and Sustainability Report (BRSR) for the FY 2022-23 was honored with Silver Award under Small Cap Manufacturing Sector market capitalisation less than Rs.3000 crores by The Institute of Chartered Accountants of India. This accolade highlights Wendt''s steadfast commitment to environmental, social, and governance principles, as well as supply chain integrity and human rights.

• ICMAI Award for Excellence in Cost Management FY 2021-22

Wendt (India) Limited adjudged First Position under the category Manufacturing-Private-Small companies for (Turnover of Rs.100 to Rs.500

ENTERPRISE VALUE ADDITION (EVA)

• Gross Value Added is Revenue less Expenditure (excluding depreciation, expenditure on employee & directors service).

• Payment to Government is current tax dividend distribution tax.

• Replacement and expansion is retained earnings depreciation deferred tax.

• The Company has been constantly investing towards replacement and expansion expenditure to ensure fulfilment of market demand.

The Company has been able to continuously add value, the summary of which is given below: jn i-^s)
Particulars	2023-24	2022-23	2021-22	2020-21	2019-20
Generation of Gross Value added	9736	9432	7494	5451	5251
Breakup on Application of Value added
Payment to Employees	3637	3362	3110	2928	3136
Payment to Shareholders (on payment basis)	1600	1500	800	700	300
Payment to Government	1273	1213	921	375	404
Payment to Directors	35	39	29	24	22
Towards replacement and expansion	3190	3318	2634	1424	1389
Total	9736	9432	7494	5451	5251

crores) by the Institute of Cost Accountants of India (ICMAI) for the FY 2021-22.

• CFO 100 -Roll of Honor 2024

The Company''s CFO, Mukesh Kumar Hamirwasia was conferred with the CFO 100 Roll of Honor 2024 from CFO Collective (IMA India).

• QCFI -CCQC 2023 Competition

8 teams participated in CCQC Competition during Oct 2023, and all 8 teams won Gold Award and the Company also bagged an individual gold award for poster competition.

• CUFEST 2023 Awards

Employees participated in Group-level Quality competition ''CUFEST 2023'' (Quality festival of CUMI), and won awards for Marketing Excellence, SCM & Commercial Excellence, SGA, Slogan, Product Innovation, Theme Video, 5s and Idea King categories.

• Shine Awards

Murugappa Group recognises the best role Models for its five lights- Integrity, Passion, Quality, Respect and Responsibility. During the year, 3 of the Company''s employees were declared shine award winners under the category of Integrity, Quality and Responsibility.

• Individual Excellence Award

The Organisation Organisation awarded employees who demonstrated high sense of ownership and responsibility and delivered consistent results in various areas such as Highest Sales, Highest Order booking, Lowest credit period, productivity, cycle time reduction, Safety, Quality, Problem solving, Customer satisfaction, Innovation, QRM, and best 5S practices, etc.

® OPPORTUNITIES & THREATS

OQO

® OPPORTUNITIES

Disruptive technologies like Electric Automobiles, the recent emerging trend in the automotive industry, although a threat to the IC engine, also provides opportunities to explore this segment and find opportunity in vehicles.

Nano Cubic Boron Nitride abrasives are likely to augment applicability of Super Abrasives in many medical and electronic industry applications. The

Company is exploring to venture into EV, medical and electronics segments by collaboration and technology tie-ups with global partners to grow further.

The industries in the Auto, Aerospace, and Electronics manufacturing space demand high-performance applications. Improvements in the design of diamond wheels used to finish ceramics can be key to cost-effective manufacturing. Metal-bond specially design wheels for longer wheel life can lead to shorter process cycle times while also ensuring longer life, thereby reducing the overall grinding cost. The Company achieving the aerospace certification is a step in looking at growing this segment in future.

The Company would continue to leverage upon its vast experience and technical expertise, deep understanding of customer requirements, comprehensive product range, superior technology and the resultant competitive edge emerging out of its complementary business verticals namely Super Abrasives, Machine Tools and Precision Components.

Further, the Government''s focus on Projects like ''Make in India'' and ''Make for World'' are expected to give a boost to the Company''s products being import substitute, thus helping in conservation of precious foreign exchange during these difficult times.

/h THREATS

Industry leaders across the globe, with high brand value afford significant Research operations. Investment in R&D activities by these major players to innovate in the existing products and develop new technologies to sustain competition in the market is very high. On the other hand, there are many unorganised, regional proprietary run entities that are smaller in size with limited offerings, which address customers'' requirements in a specific region only.

In order to counter both the extremes, the Company strives to evolve a unique approach to improve its market presence, market share and address both the segments. To address the price competitive market, the Company has launched fast-moving and Standard Super Abrasives and other tooling products and has been aggressively conducting promotional activities at the vicinity of high potential customers. For addressing the high performance, quality conscious segment, the Company is working with foreign Research Institutes and is on lookout for product specific, niche manufacturers for acquiring state-of-the-art technology.

Risks and Concerns

The Company has constituted a Risk Management Committee (RMC) aligned with the requirements of the Companies Act, 2013 and Listing Regulations. The details of the Committee and its terms of reference are set out in the Corporate Governance Report forming part of this Report.

The Company has a robust business risk management process to identify, evaluate and mitigate risks impacting the business including those which may threaten the existence of the Company. This framework seeks to create transparency, minimise adverse impact on the business objectives and enhance the Company''s competitive advantage. This also defines risk management approach across the organisation across various levels including documentation and reporting.

In an ever-changing economic landscape marked by dynamic customer demand, we proactively monitor risks to evaluate their potential short term and long term impact and strategically plan for effective mitigation.

The Company determines the categories of risk from

strategic, operational, environmental, legal, social, cyber risks, extended enterprise and financial which the organisation may be exposed to and could impact its ability to conduct its business operations without disruption, to provide customer satisfaction and achieve sustainable success.

The Risk Management also forms an integral part of the Company''s Business Plan.

The Company has also developed a structured Risk Management Policy encompassing the risk management objectives, principles, processes, responsibility for implementation, maintenance of risk registers, review of risk movements, risk reporting framework etc.

After the risk is identified, risk prioritisation is undertaken which involves assigning a score based on the impact (potential outcome) & likelihood (probability of occurrence). The risks are also assessed for velocity (how fast a risk can impact an organisation) to assess the need for crisis plan. The risk response of the Company is of the following types:

• Avoidance i.e., not to start or continue with an activity which gives rise to a risk.

• Sharing the risk i.e., sharing with another party, the burden of loss or the benefit of gain, from a risk.

• Mitigating risk, an action that reduces the impact or likelihood of a risk.

• Retention, where no worthwhile controls actions are feasible, and the risk is within the Company''s tolerance level.

INDIAN ACCOUNTING STANDARDS (IND AS) - IFRS CONVERGED STANDARDS

The Company had adopted Ind AS with effect from 1^st April 2016 pursuant to the Companies (Indian Accounting Standard) Rules, 2015 notified by the Ministry of Corporate Affairs on 16^th February 2015.

INTERNAL CONTROL SYSTEM & ADEQUACY

The Company has an Internal Control system commensurate with the size, scale, and complexity of its operations. The controls have been designed and categorised based on the nature, type and the risk

rating so as to effectively ensure the reliability of operations with adequate checks and balances.

The Company''s internal control system covers the following aspects:

• Safeguarding the assets of the Company.

• Financial proprietary of business transactions.

• Compliance with prevalent statutes regulations, policies and procedures.

• Control over capital and revenue expenditure with reference to approved budgets.

• Investment decisions are subject to detailed evaluation and formal approval according to the authority schedule in place.

The Internal Audit function is delegated to an external firm which evaluates the effectiveness and adequacy of internal controls, compliance with operating systems, policies and procedures of the Company and recommends improvements. The scope of the Internal Audit is annually determined by the Audit Committee considering inputs from the Statutory Auditors and the Management Team. Significant audit observations and the corrective/ preventive actions taken by the process owners is presented to the Audit Committee. A Periodic review of the adherence to the agreed action plan is carried out.

The Audit Committee of the Board periodically reviews audit plans, observations, and recommendations of the internal and external auditors, with reference to the significant risk areas and adequacy of internal controls and keeps the Board of Directors informed of its observations, if any, from time to time.

During the year, there were no changes in internal control over financial reporting that have materially affected or are likely to have any financial reporting lapse.

Hk INTERNAL FINANCIAL CONTROLS (IFC)

Internal Control is a process, effected by an entity''s Board of Directors, Management and other personnel, designed to provide reasonable assurance regarding the achievement of objectives relating to operations, reporting and compliance as defined by the Committee of Sponsoring Organisations (COSO) of the Treadway Commission (appointed by SEC, USA).

As per Section 134(5)(e) of the Companies Act, 2013 the term Internal Financial Control (IFC) means the policies and the procedures adopted by the Company for ensuring:

a) orderly and efficient conduct of its business, including adherence to accounting policies,

b) safeguarding of its assets,

c) prevention and detection of frauds and errors,

d) accuracy and completeness of accounting records and

e) timely preparation of reliable financial information.

The key components of IFC followed by the Company are:

1. Entity Level Controls (ELC) that the management relies on to establish appropriate Code of Conduct, Enforcement and Delegation of Authority, Hiring and Retention practices, Whistle Blower mechanism, and other policies and procedures.

2. Process Level Controls (PLC) to ensure processes are stable, predictable and consistently operating at the targeted level of performance classified into Manual or Automated or IT dependent Controls. They are also classified as Preventive or Detective.

3. General IT Controls to ensure appropriate functioning of IT applications and systems built by Company to enable accurate and timely processing of financial data are-User Access rights; Management and Logical Access; Change Management controls; password policies and practices; Patch management and License management; back up and recovery of data.

The adequacy of IFC is ensured by:

• Documentation of risks and controls associated with major processes;

• Validation classification of existing Controls to mitigate risks;

• Identification of improvements and upgrades to the control;

• Improving the effectiveness of controls through data analytics;

• Performing testing of controls by Independent Internal Audit firm;

• Implementation of sustainable solutions to Audit observations;

The IFC Audit is conducted annually by an independent firm of Chartered Accountants by testing of controls to ensure that all controls are operational, effective, adequate and identifying improvements to controls wherever necessary which is reviewed by the Audit Committee.

FINANCIAL REVIEW Liquidity and Cash Equivalents

The Company follows efficient working capital management. This requires being prudent in capital expenditure. Also, making its cash conversion cycle more efficient through faster collections from debtors, faster conversion from raw materials to finished goods through QRM resulting in healthy cash generation. Thereby, the Company is able to maintain its debt-free status.

The Company''s robust Cash Management Policy is based on:

a. Uses cash to provide sufficient working capital to address business objectives of the Company and to add value to all stakeholders by continued enhancement.

b. Conserves sufficient cash as reserves that will aid the Company in venturing into meaningful business opportunities that unfold in future.

c. Prudently invest surplus funds that the business generates in liquid investments including AAA rated debt schemes of mutual funds as per the Board approved policy. This ensures the availability, safety and liquidity of the Company''s funds while ensuring reasonable yield as per the prevailing market rates. The surplus funds are generated through stringent control of working capital.

As on 31^st March 2024, the Company''s investment in debt mutual funds was Rs.6831 lakhs in securities holding papers with high credit rating.

Costs

The Company continues the cost optimisation initiatives which was started during COVID times. This leads to continued focus on controllable costs in terms of reduction of losses and rejections, better negotiations with suppliers and vendors, price increase with customers and better price realisation from sale of scrap etc. The year started with high commodity price along with supply chain disruption which improved as the year progressed. The Company managed its cost by negotiating annual price with critical suppliers and buying in bulk based on annual demand projection. To combat supply chain disruption, the Company continues developing alternate suppliers as a part of its de-risking strategy. Also, the Company continues looking at the indigenisation of some of the supplies.

Initiatives like Vendor Managed Inventory (VMI) has ensured continuity of supplies of critical items including rationalisation of costs. Focus on Cost Optimisation has yielded savings in all the business segments. The rigorous variable and fixed cost reduction initiatives undertaken in the previous year has resulted in good improvement in the bottom line.

(H FINANCIAL POSITION Share Capital

The paid-up equity share capital as on 31^st March 2024 was ? 200 lakhs. During the year under review, the Company has not issued shares with differential voting rights nor granted stock options nor sweat equity.

Shareholders'' Funds

The shareholders'' fund as on 31^st March 2024 was Rs.19201 lakhs against Rs.16933 lakhs of previous year. Accordingly, the book value of the share stands at Rs. 960/- as compared to Rs.847/- during the previous year.

Loan Funds

The Company continues its debt free status as it does not have any long-term borrowing. It continues to utilise its cash credit limit with the banks to bridge the short-term fund requirement and for meeting the temporary mismatches in its cash flow.

Credit Rating

Your Company''s credit rating as on 31^st March 2024 are as follows:

Rating Agency	Long- term Debt facilities	Short-term Debt facilities
ICRA Limited	AA (-), Positive Outlook	A1( )

The working capital limits of the Company continued to be rated by ICRA as AA- (pronounced ICRA double A minus) rating assigned to the Rs. 2 Crore Long-term Fund facilities of the Company which signifies low credit risk and stable. The short-term rating assigned to Rs. 19 crore Non-Fund Based working capital limit also continued to be reaffirmed as A1 (pronounced ICRA A one plus).

There are no material changes and commitments affecting the financial position of the Company which have occurred between 31^st March 2024 and the date of this Report.

M, ASSETS

*** CAPITAL EXPENDITURE

The Company follows the policy of being prudent in its capex spend. During the current year, the capital expenditure was Rs. 1115 lakhs (Previous year: 1152 Lakhs). The major capex spent was on addition of new plant & machinery towards capability building in fast growing products and new products capacity enhancements, which are critical for the future growth of the Company. As in the past, the Company follows the policy of funding all the capex through internal accruals. The Company reviews all its capex investments performance periodically against the projected rate of interest and payback period.

INVENTORIES AND SUNDRY DEBTORS

The Company follows rigorous Working Capital Management, based on a robust process of continuous monitoring and control of receivables, inventories and other parameters. The overall inventory level as on 31^st March 2024 is Rs. 3385 lakhs which is higher than previous year by Rs. 230 lakhs, an increase by 7%. In order to mitigate the supply chain disruption and ensure continuity of production, the Company holds strategic inventory of around Rs.250 lakhs.

Receivables (Gross) as on 31^st March 2024, were at Rs. 5220 lakhs against Rs.3848 lakhs during the previous year. The higher receivables is due to record highest sales executed during March 2024. The Company closely monitors the Days Sales Outstanding (DSO) through an aggressive receivable management system including close follow ups and credit lock through the SAP system. This ensures that receivables are kept under control and payments received on time. The Company has been able to maintain the receivable average credit days at 79 days.

FOREIGN EXCHANGE HEDGING

The Company, being a net exporter, continues to practice natural hedging of foreign exchange earnings and outflow and does not take forward covers. The net forex gain during the year was Rs.93 lakhs (Previous Year: Rs.107 lakhs). During the year, the Company managed its exchange volatility by opening EEFC account in USD. Based on the success, the Company wishes to extrapolate the success of EEFC USD account to Euro currency also.

H HUMAN RESOURCE

Wendt, being an engineering-knowledge-based Company, considers employees as its most precious assets. The Company has a strong and diverse workforce where every employee is involved as "Partners" in the progress. The intangible asset comprises all the competencies of the people within the organisation in terms of education, experience, potential and capacity. The Company encourages & motivates diversity amongst employees and encourages them to take active part in activities such as Cross Functional Teams (CFTs), Kaizens, Small Group Activities (SGAs), and Suggestions.

The Company emphasises Safety at the workplace with focused and highest attention from the Board. Periodic training and awareness sessions continue to be conducted for identification and elimination of unsafe working conditions.

Cordial relations continue to be maintained with the employees and the work atmosphere remained congenial throughout the year. The manpower strength of confirmed employees of the Company as on 31^st March 2024 was 378.

The Company has a policy on prevention of sexual harassment at workplace in line with the requirement of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. The Company had constituted an Internal Complaints Committee as required under Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. No complaints were received during the year under review.

Major HR initiatives deployed during 2023-24

Enabling Change Management

• Initiated Job profiling through subject matter expert to identify unique job roles with job description and career lattice for each role.

• Organisation restructuring has been done to ensure right people are placed at right place.

• Enhance new joinee experience through best on boarding experience by hand holding them through mentoring and buddy network, periodic dialogues, improved induction etc.

• High Potential (HIPO) employees are identified and initiated Individual Development Plan (IDPs) and various leadership programs. This would ensure that are ready for succession to key roles.

• Wage restructuring has been done to support higher retiral benefits to employees.

• Strategy & Business Development workshop are conducted to large audience so that they can understand Business plan process and contribute to its success which gives a sense of belongingness to all employees.

• Signed permanent wage settlement timely with all Non-Management Staffs (NMS) so that industrial harmony is maintained.

• Created opportunities for all employees to interact with CEO and Senior Leadership Team to showcase their accomplishments, aspirations etc.

Hiring & Skill Development

• Recruited around 30 key talents laterally to support business needs.

• As part of competency enhancement, specific programs have been organised through Subject Matter Experts towards Customer centricity, Sales excellence, Supervisory Development, Advanced communications, topics on Sustainability, Accounting and Finance, Internal audit, Audit trail, Cyber security etc., and Knowledge sharing sessions were conducted for the benefit of larger groups.

• Exclusive development program conducted for all Sales team including Key account management and Field Coaching Tool.

• Around 3-man days of trainings have been provided for each employee as part of capability enhancement on various competencies.

Improving employee engagement levels

• Interaction with every shopfloor employee by HR team to understand workplace issues, safety, grievances, scope for improvement etc., and taking timely action.

• Established business partnership of HR to extend focused support to business.

• Platforms are provided to employees by way of monthly structured reviews to share their highlights & plans and to seek support. Employees started focusing on Common objective as business goal rather than individual focus.

• Leveraged Reward scheme effectively to identify the best performers and recognise and reward them timely to cover almost 80% of employees in one or other categories of performance.

• Emphasised focus on TEI (ie. suggestions, Kaizen, Cross Functional Team, Small Group Activity through various celebrations, competitions, communications etc.

Digitalisation of HR process

• Identified partner and started working on digitisation of HR function starting from Hire to Exit/Retire. Phase 1 of the digitisation of HR process is underway.

RELATED PARTY TRANSACTIONS

The Company, as per the requirements of the Companies Act, 2013 and Regulation 23 of the Listing Regulations has a Policy for dealing with Related Parties. Further, in line with the amendments made in Listing Regulations pertaining to related party transactions which are effective on prospective basis i.e. w.e.f. 1^st April 2022 onwards, the policy on dealing with related party transactions was amended to adapt to the changes.

In line with its stated policy, all Related Party transactions both under the Companies Act, 2013 as well as the Listing Regulations are placed before the Audit Committee for its review and approval. Prior approval of the Committee is obtained on a quarterly basis for the transactions that are foreseen and repetitive in nature. Omnibus approval in respect of transactions which are not routine, or which cannot be foreseen or envisaged are also obtained as permitted under the applicable laws and the thresholds are periodically reviewed. The list of Related parties is reviewed and periodically updated as per the prevailing regulatory conditions.

The details of transactions proposed to be entered with Related Parties are placed before the Audit Committee for approval on an annual basis before the commencement of the financial year. Thereafter, a statement containing the nature and value of the transactions entered by the Company with Related Parties is presented for quarterly review by the Committee. Further, revised estimates or changes, if any to the proposed transactions for the remaining period are also placed for approval of the Committee on a quarterly basis. Besides, the Related Party transactions entered during the year are also reviewed by the Board on an annual basis. During the Audit Committee meeting held on 14^th March 2024, the transactions of the subsidiary company with their

Related Parties as well as those envisaged with the Related parties of the Company were placed before the Audit Committee of the Company. The approval of estimates and revisions to this list of transactions is planned in the same manner as done for the parent company (detailed above).

All transactions with Related Parties under the Companies Act, 2013 entered during the financial year were in the ordinary course of business and on an arm''s length basis and hence no particulars are required to be entered in the Form AOC-2. Further, all transactions entered into with Related Parties during the year even at arms'' length basis in the ordinary course did not exceed the thresholds prescribed under the Companies (Meetings of Board and its Powers) Rules, 2014 or Listing Regulations or the Company''s Policy in this regard and hence no disclosure was required to be made in Form AOC-2. Accordingly, there are no contracts or arrangements entered with Related Parties during the year to be disclosed under Sections 188(1) and 134(h) of the Companies Act, 2013 in Form AOC- 2. The Form AOC-2 in the prescribed format is annexed to this report as Annexure-B.

There are no materially significant Related Party transactions made by the Company with its Promoters, Directors, Key Managerial Personnel, or their relatives may have a potential conflict with the interest of the Company at large.

The Policy on Related Party Transactions as approved by the Board is uploaded on the Company''s website https://wendtindia.com/wp-content/uploads/2024/04/Policy-on-Related-Party-Transactions.pdf. None of the Directors and KMPs had any pecuniary relationship or transaction with the Company other than those relating to remuneration in their capacity as Directors/Executives and corporate action entitlements in their capacity as shareholders of the Company.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

In November 2018, the Ministry of Corporate Affairs (MCA) constituted a Committee on Business Responsibility Reporting ("the Committee") to finalise business responsibility reporting formats for listed and unlisted companies, based on the framework of the National Guidelines on Responsible Business Conduct (NGRBC). Through its report, the Committee

recommended that Business Responsibility Reporting (BRR) be upgraded to Business Responsibility and Sustainability Reporting (BRSR) where disclosures are based on ESG parameters, mandating organisations to holistically engage with stakeholders and go beyond regulatory compliances in terms of business measures and their reporting. SEBI, vide its circular dated 10^th May 2021, made BRSR mandatory for the top 1,000 listed companies (by market capitalisation) from fiscal year 2023, while disclosure was voluntary for fiscal year 2022. The Company is ranked 896^th position as per the market capitalisation at NSE as on 31^st March 2024.

A copy of the Policy is available at https://wendtindia.com/wp-content/uploads/2023/06/busines-responsibility-policy.pdf.

The Business Responsibility and sustainability Report for the year ended 31^st March 2024 in terms of amended Regulation 34 of the Listing Regulations is annexed to this Report as Annexure E.

GOVERNANCE

BOARD OF DIRECTORS

As on 31^st March 2024, the Board of the Company comprised six Directors of which half (three) are independent.

During the FY 2023-24, Mr. Sridharan Rangarajan was appointed as an additional Director at the Board meeting held on 19^th October 2023. Approval of Members for his appointment by way of Postal ballot was obtained on 15^th December 2023. Mr. C Srikanth was appointed as an Executive Director & Chief Executive Officer effective 19^th October 2023 and the same was approved by the shareholders by way of postal ballot on 15^th December 2023. Consequent to the changes in the Board composition, the constitution of Committees of the Board was reviewed and revised more fully detailed in the Corporate Governance section of the Report.

Mr. Muthiah Venkatachalam retires by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment. A proposal for his re-appointment is included in the Notice convening the 42^nd Annual General Meeting for consideration and approval by the shareholders.

Further, during the year, Mr. N Ananthaseshan, NonExecutive Non- Independent Director stepped

down from the Board effective 2^nd August 2023. Mr. N Lakshminarayan on completion of his second term retired as a Non-Executive Independent Director with effect from 30^th November 2023.The Board placed on record its appreciation for the services rendered by Mr. M Lakshminarayan and Mr. N Ananthaseshan during their tenure of office as Directors of the Company including as members of its various Committees.

The Company has received declarations from all its Independent Directors confirming that they meet the criteria of independence prescribed both under the Companies Act, 2013 and the Listing Regulations. In the opinion of the Board, all the Directors appointed during the year are persons with integrity, expertise and possess relevant experience in their respective fields.

All the Independent Directors of the Company have registered their names in the Independent Directors Data bank and had completed test/exempted as required under the Companies Act, 2013 and the Rules referred therein.

KEY MANAGERIAL PERSONNEL (KMP)

Mr. C Srikanth, Executive Director & Chief Executive Officer, Mr. Mukesh Kumar Hamirwasia, Chief Financial Officer and Mr. P Arjun Raj, Company Secretary are the Key Managerial Personnel of the Company as per Section 203 of the Companies Act, 2013.

BOARD MEETINGS

A calendar of Board Meetings is prepared and circulated in advance to the Directors.

During the year, five (5) Board Meetings were convened and held in accordance with the provisions of the Act. The date(s) of the Board Meeting and attendance of the directors are given in the Corporate Governance Report forming an integral part of this report.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and the Listing Regulations, the Board carried out an annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its various Committees as per the evaluation framework adopted by the Board on the recommendation of the Nomination and Remuneration Committee. Structured assessment forms were used in the overall Board evaluation

comprising various aspects of the Board''s functioning in terms of structure, its meetings, strategy, governance and other dynamics of its functioning besides the financial reporting process, internal controls and risk management. The evaluation of the Committees was based on their terms of reference fixed by the Board besides the dynamics of their functioning in terms of meeting frequency, effectiveness of contribution etc.

Separate questionnaires were used to evaluate the performance of individual Directors on parameters such as their level of engagement and contribution, objective judgement etc. The Executive Director''s evaluation was based on leadership qualities, strategic planning, communication, engagement with the Board etc.

The Chairman was also evaluated based on the key aspects of his role. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman, the Board as a whole and the Non-Independent Directors was carried out by the Independent Directors at their separate meeting held during the year.

POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS

Pursuant to Section 178(3) of the Companies Act 2013, the Nomination and Remuneration Committee of the Board has formulated the criteria for Board nominations as well as the policy on remuneration for Directors and employees of the Company.

The criteria for Board nominations lays down the qualification norms in terms of personal traits, experience, background and standards for independence besides the positive attributes required for a person to be inducted into the Board of the Company. Criteria for induction into Senior Management positions have also been laid down.

The Remuneration policy provides the framework for remunerating the members of the Board, Key Managerial Personnel and other employees of the Company. This Policy is guided by the principles and objectives enumerated in Section 178(4) of the Companies Act, 2013 and reflects the remuneration philosophy and principles of the Murugappa Group to ensure reasonableness and sufficiency of remuneration to attract, retain and motivate competent resources, a clear relationship of remuneration to performance and

a balance between rewarding short and long-term performance of the Company. The policy lays down broad guidelines for payment of remuneration to Executive and Non-Executive Directors within the limits approved by the shareholders. Further details are available in the Corporate Governance Report.

The Board Nomination criteria and the Remuneration policy are available on the website of the Company at https://wendtindia.com/wp-content/uploads/2024/02/Remuneration-Policy.pdf.

COMPOSITION OF AUDIT COMMITTEE

The Audit Committee of the Board comprises four members out of which three are independent. Mr. Shrinivas G. Shirgurkar is the Chairman and other members are Mrs. Hima Srinivas, Mr. Bhagya Chandra Rao and Mr. Sridharan Rangarajan. During the year, five Audit Committee meetings were held, the details of which are provided in the Corporate Governance Report.

COST AUDIT

Pursuant to Section 148 of the Companies Act, 2013, read with Companies (Cost Records and Audit) Rules, 2014 and amendments thereof, the Company is required to maintain cost accounting records in respect of products of the Company covered under CETA category of Machinery & Mechanical appliances. Further, the cost accounting records maintained by the Company are required to be audited.

The Board, on the recommendation of the Audit Committee, had appointed M/s. B Y & Associates (Firm No. 003498), Cost Accountants, Chennai to audit the cost accounting records maintained by the Company under the said Rules for the FY 2021-22, FY 2022-23 and FY 2023-24 on a remuneration of Rs.1,00,000/-for each financial year. Further, they have been appointed by the Board to conduct the cost audit for the FY 202425 at the same remuneration of Rs.1,00,000/-.

The Companies Act, 2013, mandates that the remuneration payable to the Cost Auditor is to be ratified by the shareholders. Accordingly, a resolution seeking the shareholders'' ratification of the remuneration payable to the Cost Auditor for the FY 2024-25 is included in the notice convening the 42^nd Annual General Meeting.

PARTICULARS OF EMPLOYEES

The information on employees and other details required to be disclosed under Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to and forms part of this Report as Annexure D.

STATUTORY AUDITORS AND AUDITORS’ REPORT

In line with the requirements of the Companies Act, 2013, the Company, with the approval of the shareholders at the Annual General Meeting held on 22^nd July 2022 re-appointed M/s. Price Waterhouse Chartered Accountants LLP (Reg. No. FRN 012754N/ N500016) (PWC) as the Statutory Auditors of the Company to hold office from the conclusion of 40^th Annual General Meeting until the conclusion of the 45^th Annual General Meeting (AGM) on a remuneration of Rs.12,50,000/- (excluding out of pocket expenses incurred by them in connection with the Audit and applicable taxes) for the FY 2022-23 and the remuneration to be decided by the Board for the subsequent years based on the recommendation of the Audit Committee.

As required under Regulation 33 of the Listing Regulations, the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

The Report given by M/s. Price Waterhouse Chartered Accountants LLP on the Financial Statements of the Company for the year ended 31^st March 2024 is provided in the financial section of the Annual Report.

There are no qualifications, reservations, adverse remarks or disclaimers given by the Auditors in their report. The auditors have commented on the availability of the audit trail to which the Company''s response is as follows:

The Company is using SAP software for maintaining its books of accounts. SAP software keeps a complete record of all changes made to the system''s data for front-end transactions, thereby audit trail is ensured. The Audit Trail feature is activated at the database level for all the active users, to track and evaluate data modifications.

Further, SAP has in-built feature of recording audit trail (edit log). However, in respect of audit trail not maintained at the application level for modification by certain users with specific access for value changes during transaction debugging, the Company had removed such access that was existing only with user ID basis, with effect from April 2024. However, as part of mitigation procedure, financial transactions have been reviewed randomly and found that during the audit period there were no such instances of value changes during debugging of transactions through the user id in the subject.

There were no material changes or commitments affecting the financial position after the end of the financial year and date of this report.

SECRETARIAL AUDIT

M/s. Srinidhi Sridharan & Associates, Practicing Company Secretaries, Chennai were appointed as the Secretarial Auditor to undertake the Secretarial Audit of the Company for the FY 2023-24. The report of the Secretarial Auditor for year ended 31^st March 2024 is annexed to and forms part of this Report. There are no qualifications, reservations, adverse remarks or disclaimers given by the Secretarial Auditor in the Report except on appointment of Cost Auditors.

With respect to the statement made by the Secretarial Auditor in their audit report on appointment of Cost auditors for the financial years 2021-22, 2022-23 and 2023-24, considering the turnover in respect of machine tools and precision components exceeded the thresholds prescribed under the Companies (Cost Records and Audit) Rules, 2014, from the financial year

2020- 21, the details of the applicability of the requirement to conduct the cost audit was provided to the Board by CFO at its meeting held on 19^th January 2024. The Board forthwith appointed M/s. B Y & Associates (Firm No. 003498), Cost Accountants, Chennai as Cost Auditors on 19^th January 2024 to conduct the Cost Audit for the FYs 2021-22, 2022-23 and 2023-24 and provide their report. The reports have been received on 14^th March 2024 and duly submitted by the Company on 25^th March 2024. M/s. B Y & Associates (Firm No. 003498), Cost Accountants, Chennai have been appointed as the Cost Auditor for conduct of cost audit for the FY 2023-24. All requisite forms in connection with the Cost Audit for the FYs

2021- 22, 2022-23 and 2023-24 as well as the appointment of the Cost Auditors for the above referred years have been submitted by the Company.

In terms of Regulation 24A of the Listing Regulations, there is no material unlisted subsidiary incorporated in India. Material unlisted subsidiary for the purpose of this Regulation is a subsidiary whose income/net worth exceeds 20 per cent of the consolidated income/net worth respectively of the Company and its subsidiaries in the immediately preceding accounting year. Hence, the requirement prescribed under Regulation 24A of the Listing Regulations is not applicable to the Company, in so far as material subsidiary is concerned.

SECRETARIAL STANDARDS

The Company is in compliance with the Secretarial Standard on Meetings of the Board of Directors (SS-1) and Secretarial Standard on General Meetings (SS-2).

^ CORPORATE GOVERNANCE

In terms of Regulation 34(3) read with Schedule V of the Listing Regulations, a separate section on Corporate Governance including the certificate from a Practicing Company Secretary confirming compliance is annexed to and forms an integral part of this Report.

CEO/CFO CERTIFICATE

Mr. C Srikanth, Executive Director & Chief Executive Officer and Mr. Mukesh Kumar Hamirwasia, Chief Financial Officer have submitted a certificate to the Board on the integrity of the financial statements and other matters as required under Regulation 17(8) of the Listing.

VIGIL MECHANISM UNDER WHISTLE BLOWER POLICY

The Company has a well-established whistle blower policy as part of vigil mechanism for Directors and employees to report concerns about unethical behavior, actual or suspected fraud or violation of the Company''s Code of conduct or ethics policy. This mechanism also provides for adequate safeguards against victimisation of Director(s)/employee(s) who avail of the mechanism and provides for direct access to the Chairman of the Audit Committee in exceptional cases. The Whistle blower policy is available on the Company'' s website at the following link https://wendtindia.com/wp-content/themes/wendtindia/pdf/Whistle-Blower-Policv.pdf. It is affirmed that during the year, no employee was denied access to the Audit Committee.

ANNUAL RETURN

The Annual Return in Form MGT-7 is available at https://wendtindia.com/wp-content/uploads/2024/06/Annual-Return-Form-MGT-7.pdf.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(3)(c) of the Companies Act, 2013, the Board, to the best of its knowledge and belief and according to the information and explanations obtained by it confirm that:

• in the preparation of the annual accounts for the financial year ended 31^st March 2024, the applicable accounting standards have been followed and there have been no material departures from the same;

• they have selected appropriate 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 as at the end of the financial year and of the profits of the Company for that period;

• proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

• the annual accounts have been prepared on a going concern basis;

• proper internal financial controls have been laid down to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

• proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively;

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO

The information on energy conservation, technology absorption, expenditure incurred on Research & Development and forex earnings/outgo as required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is annexed to and forms part of this Report as Annexure A.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company and its future operations.

OTHER CONFIRMATIONS

No application under the Insolvency and Bankruptcy Code, 2016 (IBC) was made on the Company during the year. Further, no proceeding under the IBC was initiated or is pending as at 31^st March 2024. There was no instance of one-time settlement with any Bank or Financial Institution.

ACKNOWLEDGMENTS

The Board gratefully acknowledges the co-operation received from various stakeholders of the Company viz., customers, suppliers, partners, banks, government and other statutory authorities, auditors, business associates and shareholders. The Directors extend their gratitude to all the regulatory agencies like SEBI, Registrar of Companies, Stock Exchanges and other Central and State Government authorities/agencies, vendors and sub-contracting partners for their support. The Board also acknowledges the unstinted co-operation, commitment and dedication made by all the employees of the Company in the previous financial year.

The Directors also wish to place on record their gratitude to the members of the Company for their unrelenting support & confidence.

---

Mar 31, 2022

Management Discussion & Analysis Report which is required to be furnished as per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as "the Listing Regulations") has been included in the Directors'' Report to avoid duplication and overlap.

(Including Management Discussion and Analysis)

TO THE MEMBERS OF WENDT (INDIA) LIMITED

Your Directors have the pleasure in presenting the 40^th Annual Report of Wendt (India) Limited (hereinafter referred to as ''the Company'') together with the Audited Financial Statements for the year ended 31^st March 2022. The

ECONOMIC OVERVIEW

The year 2021 brought hope for global economic growth following 2020 corona virus caused downturn, largely owing to the development and widespread deployment of COVID-19 vaccines despite the emergence of new variants. High energy prices and supply chain pressures have spurred record high inflation.

India began 2021 with high hopes buoyed by vaccine optimism only to be bogged down by the disastrous Delta variant led second wave. Quick recovery backed by less stringent lockdown conditions resulted in minimal

impact as compared to the conditions during the first wave. The Reserve Bank of India maintained its

accommodative stance throughout the year along with record low interest rates in a bid to support the nascent recovery. The resultant high liquidity coupled with supply chain issues and semi-conductor chip crunch led to soaring input costs and pinching inflation. Experts argue that the recovery which India witnessed was not broad based and was largely uneven hurting the consumption of lower income households. The pace of activity across segments was uneven with some exhibiting robust growth while some showing modest advances. The consumption

expenditure and private investments remained timid. Sectors employing unorganised sector workers bore the burnt of the contagious virus the most.

In this context, the Government took up number of structural reforms like Production Linked Incentive Schemes (PLI Schemes) across 13 sectors to boost manufacturing - Make in India (Atma-nirbhar Bharat) and Make for World and stimulate output and investments. The rationalisation of customs duty is a step to promote domestic manufacturing and helping India becoming stronger in the global value chain with higher exports. The initiatives like vehicle scrappage policy, thrust on renewable and non-conventional energy sources is expected to reduce the India''s | overreliance on fossil fuel. To promote ''Ease of Doing Business''

initiatives like proposed digitisation of land records, digital payments, single window clearance ensuring faster setup of new manufacturing units, faceless assessment and tax administration will boost manufacturing and help in making India a global manufacturing hub. Mirroring these initiatives, during the previous financial year, India became a major startup hub with number of start ups attracting investment.

The Government''s initiative of manufacturing vaccines to combat COVID-19 in India and vaccinating the entire Indian population in phases - a herculean task was

completed along with private support. Not only India vaccinated its own population, but also exported vaccines worldwide to save other needy countries.

The growth of Foreign Direct Investments (FDIs) signals the confidence of global investors in the Indian growth story as India remains the best performing Emerging Market Economy in the world. On the exports front, India surpassed the exports target of $ 400 billion (Rs. 30530 crores) by clocking more than $ 419 billion (Rs. 31981 crores) for the financial year. India signed New Economic Cooperation and Trade Agreement deals with Australia and UAE which will open infinite opportunities in terms of duty-free exports for textile, handloom, footwear etc., and boost

employment opportunities. Further, to boost infrastructure, Government has announced National Infrastructure policy and asset monetisation measures of non-core public sector assets leading to India attaining self-sufficiency in infrastructure development.

The direct tax collections rose 50% to record Rs. 13.81 trillion in FY 2021-22 exceeding budget and revised estimates. GST collections have been above Rs. 1 lakh crore every month since July 2021 showing strong recovery in industrial activities.

Employment prospects too picked up with the recovery on account of reverse migration of labour during festive

season. As economic recovery takes hold, hiring returns to pre-COVID levels across sectors.

Towards the end of the FY 2021-22, the uncertainties caused by the Russia -Ukraine war and the resultant economic impact including sanctions imposed on Russia, leading to surge in global crude oil and gas price, food grains like wheat and corn and several other commodities cast a shadow on India''s growth prospects and the cascading inflationary trend. This has led to downgrading of Indian GDP growth for FY 2022-23 to 7.4% (FICCI) & threat of increased current account deficit. Besides, the increase in commodity price along with supply chain issues will be a testing time for Indian industry. Continuing inflationary pressures could dampen consumer sentiment and reduce consumption expenditure. In short, FY 2022-23 will be a challenging year for businesses and the Government to continue the growth momentum.

INDUSTRY STRUCTURE & DEVELOPMENTS

The demand for Super Abrasive products is closely linked to the level of industrial production. Super Abrasives are used to manufacture long-lasting, expensive items like auto and aircraft parts, demand for which is highly cyclical. Diamond and Cubic Boron Nitride (CBN) Super Abrasive products are used extensively in aerospace industry and other industrial applications where price considerations are less significant as they incur high initial costs. They are used in the

machining of materials such as nickel, cast iron and cobalt-based superalloys, where precision in machining operations is of prime importance.

Increasing complexity of Super Abrasive technology in high performance applications and its high initial cost provide entry barriers for small-scale and medium-scale companies to compete with the global market leaders. While industry leaders can afford significant research operations, most unorganised players do not have access to substantial R&D resources. This disparity can make it difficult for small and medium-scale companies to compete in the market, in terms of developing products that may require advanced

technologies.

The Company being a total Grinding Solution provider, innovation is at the core of the Company''s products and processes. As such majority of our products are customised to fulfil customers'' requirements.

Our comprehensive product range backed by state-of-the-art technology, valued-added services and consistent performance, by and large fulfil the needs and expectations of our customers in diverse industrial segments.

The Company is a preferred supplier for many of the automobile, auto component, engineering, aerospace, defence, ceramics customers for their Super Abrasive Tooling solutions, Grinding & Honing Machines and Precision components. A major contribution to the Company''s revenues comes from these industries.

Also, the Company is committed to introducing new products and exploring new markets for Glass Wheels for Auto/Solar/Construction Application; Textile industry for Knife grinding industry; High performance grinding wheels for the cutting tool industry.

COMPANY PERFORMANCE OVERVIEW (STANDALONE)			(Rs. in lakhs)
	FY 2021-22	FY 2020-21	% change
Domestic Sales	11858	8637	37%
Export Sales	3954	3308	20%
Total Sales	15812	11945	32%
EBITDA (before exceptional item)	3803	1867	104%
Other Income	744	762	-2%
Profit Before Tax	3615	1653	119%
Profit After Tax	2710	1291	110%
Capital Employed	14414	12558	15%
Earnings per Share - Rs.	135.49	64.56	110%

During the FY 2021-22 the Company clocked its highest ever sales of Rs. 15812 lakhs, higher by 32 per cent over the previous year.

The Super Abrasive Business comprising Diamond/CBN Grinding Wheels in various Bonding Systems, Rotary Dressers, Stationary Dressers, Hones and Segmented products, was impacted in earlier year due to widespread COVID-19 and the related lockdowns and volatile economic situation both in India and the world. During the year, with the widespread vaccination leading to less stringent lockdown conditions resulting in pent up demand, the

Company took initiatives like regaining lost business, new products development, horizontal deployment of successful applications and products, exploring new customers, opportunities and markets, leveraging all its products as a complete package solution to serve customers better, sourcing etc., to grow the Super Abrasive Business.

These initiatives helped the Super Abrasive business achieve sales of Rs.11051 lakhs, its highest ever, growth of 37 % over | the previous year.

The domestic Super Abrasives business recorded sales of Rs. 7702 lakhs, growth of 34% over last year. The higher sales was demand from industries like auto, auto ancillaries, bearings, ceramics, cutting tools, steel, glass, etc.

The export Super Abrasives sales during the year was Rs. 3349 lakhs, higher by 44% over the previous financial year. The higher exports was due to increased sales in focus countries like USA, UK, Germany, Korea, Taiwan, Russia etc. This was achieved despite international travel restrictions whereby visiting and meeting customers in focus countries continued to be a challenge. The Company continued its efforts in connecting with customers through virtual platforms.

The Non-Super Abrasive Business comprising Machines, accessories and components clocked sales of Rs. 4761 lakhs, the highest ever, growth of 22% over the previous year.

In the machine product category, sales were Rs. 2454 lakhs, growth of 8% over previous year. Last year witnessed supply chain issues leading to global shortage of semi-conductor chips and other related parts which goes into manufacturing of machines. The timely execution and delivery of machines to various customers was ensured by better planning and bulk ordering of parts for the entire year including working closely with critical vendors and developing alternate vendors.

During the year, the Company had sold higher volume of machines. Some of the new machines developed include CUMI Jeevan - portable oxygen concentrator which provided a lifeline during COVID-19. The Company successfully developed and established models/variants of machines viz., Profile Testing machine WHS 100V, Single Pass Honing

WSP 350, Angle Wheel Head Machine AWH, CNC Wheel Dressing machine OPRA 400, Surface Grinder WHS 500H- 2 metre length long bed besides the existing range of High Precision Tungsten Carbide Ring Grinding Machine: Delta 150/250, PDM 400. These machines have been well received by the customers projecting a good performance. Machine sales in the export market achieved good growth and acceptance by the customers.

Like the previous year, the Machine Tool Division team successfully conducted online commissioning of some of the machines like OPERA 400, Delta 150, WDM 8V etc. These commissioning were done at customer place as travelling was not possible due to restrictions imposed to prevent the spread of COVID.

deploying its core competencies - Expertise, Experience and Knowledge on Grinding, Machines & Super Abrasive Tools for producing related precision components.

Indian Abrasive market was valued at USD 363.26 million in 2021 and is expected to project a robust growth with a CAGR of 6.61%. Initiatives like ''Smart Cities Mission'' and ''Housing for All'' along with rising demand for electronics and automobiles are driving the growth of Indian Abrasive market.

Global Super Abrasive market size is estimated to grow to USD 4.8 billion by 2025. Major factors responsible for the growth of global super abrasives market include growing awareness regarding adoption of high-end technologies and their benefits coupled with the continuing growth of the automotive industry. In addition to this, the product is widely popular due to its long lifecycle, high scale hardness and

The Precision Components product category clocked sales of Rs. 2307 lakhs, higher by 43% over the previous year. The key initiatives included business in shoe CAM roller for off-road vehicles, CB18 project, distance piece besides regular business of components for the pump vanes etc. Despite the automobile slowdown, the Company managed to grow its component business due to de-risking strategy and looking at alternate opportunities wherever possible.

The Company continues its focus on exploring new business opportunities in aerospace, compressor & hydraulic parts, special inserts, Carbide industry,

Focus on Process Efficiency

The Company continues to focus on improving operational efficiency as well as optimal utilisation of various resources in manufacturing and production areas. The QRM (Quick Response Management) Initiative -POLCA which started as a pilot in the previous year was extended to one more product during this year. The project envisages reorganising the machine layout in the shop floor thereby reducing lead-time/ waiting time between workstations and improvement in shop floor inventory and other resources. This initiative is beneficial in addressing some of the key areas like planning

and scheduling, production reliability, materials availability, and product delivery. The success of pilot project has laid the way to extend the QRM initiative to other manufacturing lines also. This needs to be extended not only in manufacturing process but also in support functions. The Company ensures maintaining minimum inventory levels while safeguarding on-call supplies and on-time delivery to customers.

Optimum usage/sweating of assets based on Value Stream Mapping, by using common pool of resources (Machine) for similar operation across all cells remains the Company''s priority.

Supply Chain efficiency is one of the Company''s key focus area. The Company is committed to reducing product lead time and improving operational efficiency by reducing work in progress.

On the raw material front, the Company continuously develops alternative, reliable and competitive sources/suppliers for critical raw materials including Diamond/CBN, machine castings, systems, electrical, chemicals etc.

(including component manufacturing) is expected to reach Rs.16.16-18.18 trillion (USD 251.4-282.8 billion) by 2026 (IBEF).

With regards to the steel industry, India''s finished steel consumption is anticipated to increase to 230 MT by 2030-31 from 93.43 MT in 2020-21. As of October 2021, India was the world''s second largest producer of crude steel, with an output of 9.8 MT. In FY 2022-23, crude steel production in India is estimated to increase by 18%, to reach 120 million tonnes, driven by rising demand from customers. The growth in the Indian steel sector has been driven by domestic availability of raw materials such as iron ore and cost-effective labour (IBEF).

Due to Government''s continued thrust on infrastructure development, the demand for Indian steel is expected to increase further.

superlative performance, which is anticipated to spur the global super abrasives market growth. However, some of the factors that might act as major impediments to the growth of super abrasives market across the globe in the years to come are high cost of production along with product price volatility due to the fluctuating raw material costs.

The expected growth of above sectors provides good opportunities for the Company''s products viz., Super Abrasives, Machines and the Precision Components in future.

The Company''s growth lies in constantly monitoring changes in the external environment and adapting to the customer needs that are emerging. Accordingly, mega trends and underlying new opportunities that unfolds are being tracked continuously.

The growing usage of Super Abrasive products for various medical applications such as Surgical Instruments,

FUTURE PROSPECTS AND OUTLOOK

In the auto ancillary segment, rising middle class income and huge youth population in India is expected to be the key demand driver. India could be a leader in shared mobility by 2030, providing opportunities for Electric Vehicle (EV) and autonomous vehicles. The EV industry is expected to create 5 crores jobs by 2030 (Indian Brand Equity Foundation (IBEF)). Further, initiatives like the PLI schemes for automobile and auto components, vehicle scrappage policy, flexi fuels etc., are expected to provide growth opportunities to the automobile sector. Indian automotive industry

Hypodermic Needles, Dental implants, Knee, Hip and Shoulder joints create new opportunities for the Company to explore through technical collaboration and new products development. Also, growing Consumer Electronic Segment, with manufacturing facilities in India is expected to provide a wide array of opportunities for consumption of Super Abrasives in the coming years. The Company is exploring necessary tie-ups and collaboration to venture into these growing sectors.

To bridge the gap between optimising existing technologies & investing in advancements, the Company''s in-house R&D

decline in existing products. Focus on providing value added services, enhancing product basket, new customer additions and entering new geographies yielded desirable results.

The subsidiary will continue to focus on core business & value-added service and increased customer/product base along with measures to ensure OPEX, safety and cash flow to achieve sustainable & profitable growth.

During the year, the subsidiary successfully received strong recommendation and revalidated "ISO9001-2015" audit from "TUV NORD".

WENDT MIDDLE EAST FZE, SHARJAH

efforts are aimed at strengthening the existing technology, complemented by new methods of manufacturing.

Adoption and deployment of appropriate technologies for indigenous bond development, streamlining processes has been the key focus areas for Company''s growth prospect and the Company will continue to do so.

The Company made progress on adoption of additive manufacturing technology which is estimated as a descriptive technology for most of the machine grinding technology by partnering with leading manufacturer of 3D printing from Europe.

The Company is also exploring locating near to customers or market to serve them better. Pilot project will be established during next year for Western region in the Precision products category.

SUBSIDIARY COMPANIESWendt Grinding Technologies Limited, Thailand

The Company''s wholly owned subsidiary, Wendt Grinding Technologies Limited, Thailand, achieved sales of Thai Baht 1010 lakhs (Rs. 2298 lakhs) which is 32 % higher than the last year. This is despite unprecedented challenges and industry slowdown on account of increase in COVID-19 infection, EV impetus, political uncertainties, rising costs and all odds. The subsidiary continues to demonstrate its strong resolve and business acumen challenging the unfavourable conditions and churning out good results on a consistent basis.

The Profit Before Tax was Thai Baht 175 lakhs (Rs. 382 lakhs) and the Profit After Tax has been Thai Baht 140 lakhs (Rs. 302 lakhs), 32% higher over previous year.

With increase in number of COVID cases, employee safety was given top priority with 100% timely vaccination drive including the booster dose. During this challenging year, the subsidiary resorted to strict cost control, robust receivable management and clear business focus in terms of increasing product and customer basket and strengthening the export business. These initiatives helped in de-risking the business by compensating for the

Wendt Middle East FZE (''WME''), Sharjah, the other wholly

owned subsidiary of the Company, had applied for voluntary de-registration during last year and there were no operations. The subsidiary clocked loss of AED 1.42 lakhs (Rs. 29 lakhs).

During the year, WME has completed de-registration related procedures and has repaid the share capital to the Company. Clearance from the Hamriyah Free Zone Authority (HFZA) is awaited, after which WME will be formally liquidated/ de-registered.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company (incorporating the operations of the Company and its two wholly owned overseas subsidiaries), for the financial year 2021-22 are prepared in compliance with the applicable provisions of the Companies Act, Accounting Standards as prescribed by Regulation 33 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Consolidated Financial Statements have been prepared based on the audited financial statements of the Company, its subsidiaries, as approved by their respective Board of Directors.

Pursuant to provisions of Section 136 of the Act, the Financial Statements of the Company including the Consolidated Financial Statements along with the relevant documents and the Auditors'' Report thereon forms part of this Annual Report. A statement of summarised financials of all subsidiaries of the Company in Form AOC-1 also forms part of this Annual Report. The audited annual accounts and related information of the subsidiaries is available on our website www.wendtindia.com.

The key financial information on the consolidated operations are as follows: -

KEY CONSOLIDATED FINANCIAL SUMMARY			(Rs. in lakhs)
	FY 2021-22	FY 2020-21	% change
Sales	17724	13567	31%
EBITDA	4167	2200	89%
Other Income	543	492	10%
Profit Before Tax	3691	1700	117%
Profit After Tax	2707	1277	112%
Earnings per share - Rs.	135.34	63.83

DIVIDEND

Considering the past dividend pay-out ratio and the current year''s operating profit, the Board has recommended a final dividend of Rs.45/- per equity share of Rs.10/- each for the year ended 31^st March 2022. Besides, in January 2022, an interim dividend at the rate of Rs.20/- per equity share of Rs.10/- each was declared and paid in February 2022. This aggregates to a total dividend of Rs.65/- per equity share of Rs.10/- each for the financial year.

The Company has adopted the Dividend Distribution Policy as approved by the Board in line with the Listing Regulations and the same is available on the Company''s website www.wendtindia.com. The dividend paid as well as being recommended for the year ended 31^st March 2022 is in line with this policy.

TRANSFER TO RESERVES

The Company transferred Rs.271 lakhs to the General Reserve. An amount of Rs.7738 lakhs is retained in the Statement of Profit & Loss.

APPROPRIATIONS	(Rs. in lakhs)
Available for appropriation
Profit After Tax	2710
Add: Other Comprehensive Income	(54)
Add: Balance brought forward from previous year	6153
Total	8809
Recommended appropriations
Transfer to General Reserve	(271)
Dividend -Final (Dividend paid for 2020-21 @ Rs. 20/- per share of face value of Rs.10/- each)	(400)
Dividend tax -Interim (Dividend paid for 2021-22 @ Rs.20/- per share of face value of Rs.10/- each )	(400)
Balance carried forward	7738

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Company''s Corporate Social Responsibility pursuits have always been based on the foundation of ethical behaviour in all its business transactions and contributions for economic development of not only the workforce and their families but also extending to the local communities and society at large. The Company being a part of the Murugappa Group has been upholding this tradition by allocating a part of its profits for fulfilling its social responsibilities. The Group''s philosophy is to serve the communities in which it operates through the services of service-oriented philanthropic institutions with education and healthcare being the core focus areas.

The Company believes that social responsibility is not just a corporate obligation that has to be carried out, but an opportunity to make a difference. The Company''s Corporate Social Responsibility programmes are aimed at inclusive growth and sustainable development of the community.

The Company''s Skill Development Program was set up in 2012 in collaboration with Carborundum Universal Limited. The major focus was to provide high quality vocational and technical training to less privileged youth from weaker sections of the society by uplifting their lives and equipping them with employable skill sets. This training programme is designed based on the coaching methodology defined by Government of India,

Ministry of Skill Development and Entrepreneurship. This builds up a skill bank of technically competent and

industry ready work force benefitting the less privileged sections of the society.

This 3 year training programme is based on National Council of Vocational Training syllabus. This training is imparted with stipend to the enrolled students and free boarding facilities ensuring that they earn while they learn. Not only does this initiative help in imparting formal education, but also helps them in honing them to become a valuable citizen while helping them in seeking gainful employment upon successful completion of the course.

During the year, a grant was made to Hosur Industrial Association (''HIA'') towards building a Skill Development Centre, thus enabling the Company support the infrastructure for skill development in the area in which it operates. Hosur Industrial Association was set up in the year 1981 with an aim to protect and promote the interests of industrial establishments located in and around Hosur. Considering the increasing unemployment due to lack of requisite skill and to bridge the gap between the skill requirement versus the actual skills available, a Skill Development Centre is being built by HIA in Hosur to promote education in the field of technical trades as well as

commercial education like ERP, use of computers etc. Hosur Industrial Association is registered with the Ministry of Corporate Affairs for the purpose of undertaking/implementing CSR activities on behalf of the Company.

The Company also gives importance to green environment and tree plantation in the nearby communities by distributing and planting free saplings every year. Employees are encouraged to participate in activities like blood

donation camps, creating awareness on road safety, nominating employees with RTO as traffic wardens, 5S campaigns towards cleaner environment, imparting special education to the school children to name a few.

The Company in line with the amendments in Companies Act, 2013, formulated an annual action plan, which was approved by the Board of Directors, in pursuance of the CSR Policy of the Company, based on which spending on CSR activities were completed. The Company, during the FY 2021-22 spent Rs. 32.125 lakhs towards CSR activities and no amounts remain unspent at the end of the year.

In accordance with requirements of the Companies Act, 2013, the Company has a CSR policy incorporating the requirements therein which is also available on Company''s website at the following link www.wendtindia.com

The Annual Report on CSR activities in the prescribed format is annexed to this Report as Annexure C.

TRANSFER TO THE INVESTOR EDUCATION & PROTECTION FUND (IEPF)

In terms of Section 124 (5) of the Companies Act, 2013, an amount of Rs. 4,30,440 lakhs being unclaimed dividend during the year, pertaining to the final dividend for the FY 2013-14 (Rs. 2,51,550) and the interim dividend for the FY 2014-15 (Rs. 1,78,890) was transferred to IEPF after sending due reminders to the shareholders.

FIXED DEPOSITS

The Company has not accepted deposits from the public falling within the ambit of Section 73 of the Companies Act, 2013 and the rules framed thereunder and no amount of principal or interest was outstanding as on the balance sheet date.

LOANS AND INVESTMENTS

Particulars of Loans, Guarantees and Investments covered under Section 186 of the Companies Act, 2013 are given below. There were no loans or guarantees granted during the year.

(Rs. in lakhs)
Description		As on 31.03.2021		Movement (net of deletions)			As on 31.03.2022
Loans given by the Company		-		-			-
Corporate Guarantee given by			-		-		-
the Company
Investments made by the Company		430.55			(153.16)	k	277.39
*During the year, WME, Sharjah completed the de-registration					formalities with the	HFZA and repaid the
share capital. Clearance from HFZA is awaited after which Company will be de-registered.
Current Investments: Investments in Mutual Funds as on 31.03.2022 was Rs. 5948 Lakhs
KEY RATIOS
Sl. no.	Ratios		In terms of		31.03.2022	31.03.2021
1.	Performance Ratios
a.	Operating Profit / Net Sales		(%)		19		9
b.	EBIDTA / Net Sales		(%)		28		21
c.	PBIT / Net Sales		(%)		22		14
d.	Net Profit / Net Sales		(%)		17		11
e.	ROCE		(%)		24		13
f.	ROE		(%)		20		11
g.	Fixed Asset Turnover Ratio		Times		2.94		2.17
2.	Activity Ratios
a.	Inventory Turnover Ratio		Days		56		74
b.	Receivable Turnover Ratio		Days		76		86
3.	Liquidity Ratio
a.	Current Ratio		Times		1.66		1.77

The significant change in operating profit, EBITDA, Net Profit and PBIT to net sales is mainly on account of rigorous operational efficiency measures including variable and fixed cost reduction initiatives undertaken in the previous year. This has also resulted in favorable change in ROCE and ROE for the year ended 31^st March 2022.

QUALITY

The Company follows a quality assurance system with stringent tests built into every stage of production ensuring the quality of its products. The quality consciousness inbuilt in the Company''s DNA backed by a thorough understanding of customer application needs and "one to one" customer support, has made the Company a synonym for quality and reliability.

The Company has certifications of ISO 9001 and TS 16949 reinforcing its commitment to ensure Quality Management Standards are met. During the year, the Company also received TUV Nord EN9100:2018 certificate enabling the manufacture

of precision grinding, honing and CNC machined components for aerospace applications.

TS 16949 pertains to manufacturing of precision components. In order to comply with the safety norms and requirements of overseas customers, the Company has successfully renewed EN 13236 Standards during the year. Quality being the uncompromised differentiator, the Company aims to ensure that product quality is built by deploying and embracing effective quality control management, process robustness, quality assurance and discipline at every stage of material flow.

During the year, the Company has strengthened its Quality Assurance by piloting ''Green Channel Suppliers & vendors'' which will eliminate incoming inspection thereby reducing production lead time & faster customer delivery. Also, the Company continued planned supplier audits and assessing supplier gaps, if any thereby improving incoming materials quality performance.

SAFETY, HEALTH AND ENVIRONMENT (SHE)

Safety remains the key area of focus for the Company. Behaviour based training both in person as well as virtually were conducted to promote a culture of safe working. The Company recognises the need and is committed to provide Safe, Healthy and Socially Accountable Work Culture in the Organisation. The Company has complied with the requirements of internationally recognised Social Accountability Standard SA 8000:2014 and periodically reviews its policy to cater to the changing requirements. The Senior Management takes responsibility for maintaining these standards through deployment of relevant processes and guidelines in line with OHSAS 18001 and ISO 14001 standards.

All personnel on a periodical basis receive effective health and safety training, including on-site training, job specific training etc. During the year, the Company has provided trainings for creating awareness about the significance of safety amongst employees and visitors including by way of setting up of safety training kiosk.

Quarterly mock drills for fire safety, annual health check-up for employees, special medical attention for employees working in special process & sensitive areas, use of Personal Protection Equipment (PPEs), zero discharge of ETP/STP and hazardous waste handling are some of the initiatives, which the Company undertook during this year.

The COVID-19 pandemic spread to India, actions were taken to enhance employee awareness, health, and safety, with also ensuring business continuity.

The Company continues following the COVID-19 protocols and safety measures in terms of social distancing, including restricted movement of manpower, use of hand sanitisers and face mask at workplace. The Company is a 100% Vaccinated Company with all employees and their families completing both doses of vaccines. The Company organised several vaccination camps in tie-up with Kauvery Hospitals and HIA within its premises for employees, their family members as well as for its suppliers, and vendors. It has also extended the COVID-19 safety protocols to its suppliers and outsourcing partners. This has enabled the Company to continue uninterrupted production.

RECOGNITIONS AND AWARDS

The Company encourages its employees to participate in customer audits, group competitions, various national and international events & competitions. During the year, the Company received many awards and accolades from well recognised organisations, establishments and certifying bodies for various distinctive achievements. Needless to mention that these recognitions and accolades enhance the passion and optimism among the employees and acts as key motivator for the Company as a whole. Some of the key recognitions received during the year are as follows:

• QCFI -CCQC 2021 Competition

10 teams participated in CCQC Competition during November 2021. 9 teams won Gold Award and 1 team bagged Silver Award.

• NHRD - Hosur Chapter, HIA & JDISH OSH Excellence Award

Employees participated and shared the Best OHS Practices of Wendt. Participants were recognised and certified during the valedictory function conducted on 25^th March 2022 at HIA-Hosur that was headed by Director of Industrial Safety and Health (FAC) & Joint Director of Industrial Safety and Health, Hosur.

• Cufest 2021 Awards

Employees participated in Group-level Quality competitions ''Virtual CUFEST 2021'' (Quality festival of CUMI), and won awards for Sustainability Quiz, Suggestions, SCM Excellence and Sales Excellence.

• CFO of the Year Engineering 2021 Award

Mr. Mukesh Kumar Hamirwasia, CFO was awarded by Inflection Ventures as CFO of the Year Engineering 2021.

OPPORTUNITIES & THREATS OPPORTUNITIES

Disruptive technologies like Electric Automobiles, the recent emerging trend in the automotive industry, although a threat to the IC engine, provides opportunities in this segment in particular in parts suitable for EV vehicles.

Nano Cubic Boron Nitride abrasives are likely to augment applicability of Super Abrasives in many medical and electronic industry applications. The Company is exploring

venturing into EV, medical and electronics segments by collaboration and technology tie-ups with global partners to grow further.

The industries in the Auto, Aerospace and Electronics manufacturing space demand high-performance applications. Improvements in the design of diamond wheels used to finish ceramics can be key to cost-effective manufacturing. Metal-bond specially design wheels for longer wheel life can lead to shorter process cycle times while also ensuring longer life, thereby reducing the overall grinding cost. The Company achieving the aerospace certification is a step in looking at growing this segment in future.

The Company would continue to leverage upon its vast experience and technical expertise, deep understanding of customer requirements, comprehensive product range, superior technology and the resultant competitive edge emerging out of its complementary business verticals namely Super Abrasives and Non- Super Abrasives comprising of Machine Tools and Precision Components products category.

Further, the Government''s focus on projects like ''Make In India'' or ''Atma Nirbhar Bharat'' are expected to give a boost to the Company''s products being import substitute, thus helping in conservation of precious foreign exchange during these difficult times.

THREATS

Industry leaders across globe, with high brand value afford significant research operations. Investment in R&D activities by these major players to innovate the existing products and to develop new technologies to sustain competition in the market is very high. On the other hand, we have many

unorganised, regional proprietary run entities that are smaller in size with limited offering, addressing customer requirements in a specific region.

In order to counter both the extremes, the Company strives to evolve a unique approach to improve its market

presence and market share. To address the price competitive market, the Company has launched fast moving and Standard Super Abrasives and other tooling products in STAR brand and has been aggressively conducting promotional activities in the vicinity of high potential customers. For addressing the high performance, quality conscious segment, the Company is working with foreign research institutes and is on lookout for product specific, niche manufacturers for acquiring state-of-the-art technology.

Enterprise Value Addition (EVA)				(Rs. in lakhs)
Particulars	2021-22	2020-21	2019-20	2018-19	2017-18
Generation of Gross Value added	7494	5451	5251	5800	5272
Breakup on Application of Value added
Payment to Employees	3110	2928	3136	2892	2588
Payment to Shareholders (on payment basis)	800	700	300	600	500
Payment to Government	921	375	404	740	692
Payment to Directors	29	24	22	21	16
Towards replacement and expansion	2634	1424	1389	1547	1476
Total	7494	5451	5251	5800	5272

• Gross Value Added is Revenue less Expenditure (excluding depreciation, expenditure on employee & directors service).

• Payment to Government is current tax dividend distribution tax.

• Replacement and expansion is retained earnings depreciation deferred tax.

• The Company has been constantly investing towards replacement and expansion expenditure to ensure fulfilment of market demand.

The Company has a robust business risk management process ^

to identify, evaluate and mitigate risks impacting business

including those which may threaten the existence of the I iffi J^BhEi

risks, extended enterprise and financial, which the H^^Er\ I l

organisation may be exposed to and could impact its ability to

conduct its business operations without disruption, to provide customer satisfaction and achieve sustained success.

The Risk Management also forms an integral part of the Company''s Business Plan. The Company has developed a structured risk management policy encompassing the risk management objectives, principles, process responsibility for implementation, maintenance of risk registers, review of risk movements, risk reporting framework etc.

After the risk is identified. Risk Prioritisation involves assigning score based on impact (potential outcome) & likelihood (probability of occurrence). The risks are also assessed for velocity (how fast a risk can impact an organisation) to assess the need for crisis plan.

The risk response of the Company is of the following types:

• Avoidance i.e., not to start or continue with an activity which gives rise to a risk

• Sharing the risk i.e.. Sharing with another party, the burden of loss or the benefit of gain, from a risk.

• Mitigating risk, an action that reduces the impact or likelihood of a risk.

• Retention where no worthwhile controls actions are feasible, and the risk is within the organisation''s risk tolerance.

Some of the risks associated with the business and the related mitigation plans are given below. However, the risks given below are not exhaustive and assessment of risk is based on management perception.

Raw Material commodity price increase

Why is it considered as a Risk?

• non availability due to pandemic, global supply chain issues and global unrest.

• scarcity of raw material.

• logistics issues.

Mitigation Plan/Counter measure to address

• Identifying alternate source of raw material.

• Premium price for faster delivery.

• Better forecasting and advance ordering in bulk.

User Industry concentration Risk

Why is it considered as a Risk?

• Disruption in the overall automotive market landscape due to transition of the automobile industry towards hybrids and electric vehicles.

• Effect on customer relationship with change in ownership.

• Disruptive innovation & process changes.

• Newer technology like Integrated Starter Generator and Belt-Driven Starter Generator that are likely to replace alternator and generator in the automobile.

Mitigation Plan/Counter measure to address

• Identifying alternate Industry base Segments based on Mega Trends- Aerospace, Bearings, Razor Blade, Glass, Power (Solar, Nuclear, Wind and Gas).

• Widening the customer base/new industry segment & new geographies thereby de-risking the business.

• Pursuing product innovation and new application development as per government norms.

• Building relationship and engagement with the customer by adopting new initiatives conducting Technical Seminar - both online and on-site, participation in international exhibitions, CRM & Knowledge Management application.

• Working with renowned research universities and technical consultants, to develop new products.

• Focus on Digital Marketing, to acquire new customers and pursue new applications.

Competition Risk

Why is it considered as a Risk?

• Loss in share of business for standard and low precision products, due to presence of many unorganised regional players often adopting measures like pricing strategy, free samples, longer credit period etc.

• Disruption in global competition by Chinese low-cost products.

• Major companies acquiring local dealers/manufacturers and entering into partnerships with major end users for continuous supply of products.

• Organised player spending on Research and Development and coming up with new products.

Mitigation Plan/Counter measure to address

• Launching High Performance standard products, with competitive price and branding products by conducting seminar at Tier 1 & Tier 2 cities, Mela at dealer locations and participating in various exhibitions.

• Measures like New product development, lost business regain, gain from competition, horizontal deployment of successful applications.

• Association with external agency for developing new products for different applications.

• Offering products against import substitute by focusing on cost, delivery, quality and technical support.

• Automation and Robotisation to address lower manufacturing cost and enhance competitiveness.

Technology Risk

Why is it considered as a Risk?

• Elimination of Machining Process (Turning, Milling, Grinding, Honing).

• High investment on Technology by key global players.

• Access to advanced technologies.

Mitigation Plan/Counter measure to address

• Enhance in-house R&D efforts (DSIR approved R&D) to strengthen existing technology, complemented by new methods of manufacturing.

• Association with external Research laboratories/Technical institutes for technology upgradation.

• Collaboration with external consultants for product and process innovations.

• Initiated overseas partnership for Additive Manufacturing.

HR & Legal Risk

Why is it considered as a Risk?

• Employee disengagement risk, owing COVID-19 Pandemic.

• Attrition of skilled/trained manpower by competition leading to disruption of operations or knowledge gap.

• Millennial work force - no long-term interest.

• Delay in recruitment of talents as per business needs.

• Succession planning for key roles.

Mitigation Plan/Counter measure to address

• Facilitate to enhance technical and behavioural capabilities through e-learning modes and Webinars.

• Continuous counselling on health, safety and mental well-being besides extending necessary support to employees and their family members on matters relating to COVID-19.

• Improve leadership readiness to manage the growth initiatives by identifying internal and external incumbent for next set of leadership positions through the Internal Development Programs (IDP).

• Focus on acquiring high skilled talents from best-in-class domains/organisations.

• Design & implement career road map through structured development plan for career enhancement based on roles and job descriptions.

• Mentoring and Coaching programme for employees for enhancing engagement level.

• JD mapping and identifying training needs to fill gaps for employee development ensuring right person on right job.

Online Data & Information Security Risk-Cyber Security

Why is it considered as a Risk?

• Disruption of technology service providers (in Work from Home conditions).

• Data breach, loss or exposure increase due to a remote/mobile workforce.

• Security breaches, compliance, bugs due to unauthorised access and potential attacks.

Mitigation Plan/Counter measure to address

• The Company has a backup process available for data restoration. The Company has identified alternate service providers in case of switch over.

• Implemented SIEM (Security Information and Event Management) for identifying, monitoring, recording and analysing security events or incidents in a real-time IT environment.

• Continuous review of the Disaster Recovery Strategy & Business Continuity Policy for Technical Controls.

• Data Center access limited to authorised personnel.

• Crisis Management Group in Place.

• Strengthening network security.

• Enhancing Information Security policies & procedures.

• Vulnerability assessment and penetration testing for information system conducted periodically.

• Updating patches monthly and monitoring for issues antivirus update for entire environment including standalone IT assets.

INDIAN ACCOUNTING STANDARDS (IND AS) - IFRS CONVERGED STANDARDS

The Company had adopted Ind AS with effect from 1^st April 2016 pursuant to the Companies (Indian Accounting Standard) Rules, 2015 notified by the Ministry of Corporate Affairs on 16^th February 2015.

INTERNAL CONTROL SYSTEM & ADEQUACY

The Company has an Internal Control system commensurate with the size, scale and complexity of its operations. The controls have been designed and categorised based on the nature, type and the risk rating so as to effectively ensure the reliability of operations with adequate checks and balances.

The Company''s internal control system covers the following aspects:

• Safeguarding the assets of the Company.

• Financial proprietary of business transactions.

• Compliance with prevalent statues, regulations, policies and procedures.

• Control over capital and revenue expenditure with reference to approved budgets.

The Internal Audit function is delegated to an external Chartered Accountants'' firm which evaluates the effectiveness and adequacy of internal controls, compliance with operating systems, policies and procedures of the Company and recommends improvements. The scope of the Internal Audit is annually determined by the Audit Committee considering inputs from the Statutory Auditors and the Management Team. Significant audit observations and the corrective/ preventive actions taken by the process owners is presented to the Audit Committee. Periodic review of the adherence to the agreed action plan is carried out. The Audit Committee of the Board periodically reviews audit plans, observations and recommendations of the internal and external auditors, with reference to the significant risk areas and adequacy of internal controls and keeps the Board of Directors informed of its observations, if any, from time to time.

During the year, there were no changes in internal control over financial reporting that have materially affected or are likely to have any financial reporting lapse.

INTERNAL FINANCIAL CONTROLS (IFC)

As per Section 134 of the Companies Act, 2013, the term Internal Financial Control (IFC) means the policies and the procedures adopted by the Company for ensuring:

a) orderly and efficient conduct of its business, including adherence to accounting policies,

b) safeguarding of its assets,

c) prevention and detection of frauds and errors,

d) accuracy and completeness of accounting records and

e) timely preparation of reliable financial information.

The key components of IFC followed by the Company are:

1. Entity Level Controls (ELC) that the management relies on to establish appropriate Code of Conduct, Enforcement and Delegation of Authority, Hiring and Retention practices, Whistle Blower mechanism, and other policies and procedures.

2. Process Level Controls (PLC) to ensure processes are stable, predictable and consistently operating at targeted level of performance classified into Manual or Automated Controls. They are also classified as Preventive or Detective.

3. General IT Controls to ensure appropriate functioning of IT applications and systems built by Company to enable accurate and timely processing of financial data are - User Access rights Management and Logical Access, Change Management controls; password policies and practices, Patch management and License management; backup and recovery of data.

The adequacy of IFC is ensured by:

• Documentation of risks and controls associated with major processes.

• Validation classification of existing Controls to mitigate risks.

• Improving the effectiveness of controls through data analytics.

• Performing testing of controls by Independent Internal Audit firm.

• Implementation of sustainable solutions to Audit observations.

The IFC Audit is conducted annually by an independent firm of Accountants by testing of controls to ensure that all controls are operational, effective, adequate and identifying improvements to controls wherever necessary which is reviewed by the Audit Committee.

FINANCIAL REVIEW Liquidity and Cash Equivalents

The Company continued to have healthy cash generation during the year, being prudent in capital expenditure and efficient working capital management thereby maintaining its debt free status. The Company holds sufficient cash and cash equivalents to meet its futuristic strategic growth initiatives by following prudent investment policy. The Company''s cash surplus position helps to eliminate short and medium-term liquidity risks.

The Company follows a robust Cash Management Policy whereby it:

a. Uses cash to provide sufficient working capital to address business objectives of the Company and to add value to all stakeholders by continued enhancement.

b. Conserves sufficient cash as reserves that will aid the Company in venturing into meaningful business opportunities that unfold in future.

c. Prudently invests surplus funds that the business generates in liquid investments including AAA rated debt schemes of mutual funds as per the Board approved policy. This ensures availability, safety and liquidity of Company''s funds while allowing reasonable yield as per the prevailing market rates. The surplus funds are generated through stringent control on working capital.

As on 31^st March 2022, the Company''s investment in debt mutual funds was Rs. 5948 lakhs in securities holding papers with high credit rating.

Costs

The year witnessed commodity price increase along with supply chain disruption. The Company managed its cost by negotiating annual price with critical suppliers and buying in bulk based on annual demand projection. To combat supply chain disruption, the Company continues developing alternate suppliers as a part of its de-risking strategy. Also, Company continues looking at indigenisation of some of the supplies. Initiatives like Vendor Managed Inventory (VMI) has ensured continuity of supplies of critical items including rationalisation of costs. Focus on Cost Optimisation has yielded savings in all the business segments - Super Abrasives, Machines and Precision Components. The rigorous variable and fixed cost reduction initiatives undertaken in the previous year has resulted in good improvement in the bottom line.

FINANCIAL POSITION Share Capital

The paid-up equity share capital as on 31^st March 2022 was Rs. 200 lakhs. During the year under review, the Company has not issued shares with differential voting rights nor granted stock options nor sweat equity.

Shareholders'' Funds

The shareholders'' fund as on 31^st March 2022 was Rs.14,414 lakhs against Rs.12,558 lakhs of previous year. Accordingly, the book value of the share stands at Rs.721 /- as compared to Rs.628/- during the previous year.

Loan Funds

The Company is debt free as it does not have any long-term borrowing. It continues to utilise its cash credit limit with the banks to bridge the short-term fund requirement and for meeting the temporary mismatches in its cash flow. During the year, the Company availed Export Packing Credit (EPC) of Rs.100 lakhs under MSME scheme.

During the current year as well, the working capital limits of the Company continued to be rated by ICRA as AA-(pronounced ICRA double A minus) assigned to Rs. 2 Crore Long-term Fund facilities of the Company which signifies low credit risk and stable. The short-term rating assigned to Rs. 19 crore Non-Fund Based working capital limit also continued to be reaffirmed as A1 (pronounced ICRA A one plus).

ASSETSCapital Expenditure

The Company follows the policy of being prudent in its capex spend. During the current year, the capital expenditure was Rs. 608 lakhs. The major capex spent was on addition of new plant & machinery towards capability building in fast growing products and new products capacity enhancements, which are critical for the future growth of the Company. As in the past, the Company follows the policy of funding all the capex through internal accruals.

Inventories and Sundry Debtors

The Company follows rigorous Working Capital Management, based on a well-organised process of continuous monitoring and control on Receivables, Inventories and other parameters. The overall inventory levels as on 31^st March 2022 is Rs. 2568 lakhs which is higher than previous year by Rs. 321 lakhs, increase by 14%.

Receivables (Gross) as on 31^st March 2022, were at Rs. 3312 lakhs against Rs. 3321 lakhs during the previous year. The Company closely monitors the DSO (Days Sales Outstanding) through aggressive receivable management system including close follow ups and credit lock through the SAP system. This ensures that receivables are kept under control and payments are received in time. The Company has reduced the receivable average credit days to 76 days from 86 days in the previous year.

FOREIGN EXCHANGE HEDGING

Being a net exporter, the Company continues to practice natural hedging of foreign exchange earnings and outflow and does not take forward covers. The net forex gain during the year has been Rs.82 lakhs (Previous Year Rs.40 lakhs).

HUMAN RESOURCE

Wendt being an engineering -knowledge-based company, employees are its most precious assets. The Company has a strong and diverse workforce where every employee is involved as "partners" in the progress. The intangible asset comprises all the competencies of the people within the organisation in terms of education, experience, potential and capacity. The Company encourages & motivates diversity amongst employees and encourages them to take active part in activities such as Cross Functional Teams (CFTs), Kaizens, Small Group Activities (SGAs), and Suggestions.

Safety at the workplace remains the top priority with focused and highest attention from the Board. Periodic training and awareness sessions continue to be conducted for identification and elimination of unsafe working conditions.

During the year, the Company organised several rounds of COVID-19 vaccination drives for its employees and their families in its premises. This has ensured the Company to achieve 100% vaccination status as on date.

The Company continues to focus on identifying and drawing a structured training plan based on the competency levels, future needs and focusses on recruiting high skilled talents from best-in-class domains/organisations to fulfil the growth plans. The Company gives equal importance to physical wellness of not only its employees but also their family members by conducting annual heath check up every year. For High Potential Individuals, the Company encourages them to undergo Mentoring and Personality Development Programs, to prepare them for leadership roles and bigger business challenges in future.

Cordial relations continue to be maintained with the employees'' cordial and the work atmosphere remained congenial throughout the year. The manpower strength of employees (excluding casuals and trainees) of the Company as on 31^st March 2022 was 388 (previous year - 412).

During the year, the Company undertook organisation restructuring in line with future business goals by creating bonded and coated products under Super Abrasives segment from the erstwhile cell concept. This would ensure optimum utilisation of resources - man, material, and machines in the respective product line. The Product and Application Engineering has been created as a new role to help in quicker development and establishing the products at the customers'' end. Production Planning Control (PPC) has been created to ensure better planning, scheduling of material and machines based on available orders ensuring faster delivery to the customers.

The Company started an organisation wide job description and competency mapping exercise for all roles to identify the right fit for the right job. This will ensure in identifying the right positions based on job descriptions and finding gaps where training and development needs to be provided. This will ensure Company is adequately staffed for its future growth.

The Company has a policy on prevention of sexual harassment at workplace in line with the requirement of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. The Company has constituted an Internal Complaints Committee as required under Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. No complaints were received during the year under review.

Some of the other initiatives introduced are sales incentive scheme for sales team based on sales and order booking achieved, senior management team meeting individual employees in groups for better connect and identifying development needs, opportunity for traffic warden services for our employees, communications in local language for attracting more employees, enhanced induction process for new joiners, periodic feedback to each individual from functional heads to ensure function is progressing towards business goals, career guidance advice with experts to employee children, online experts sessions on financial wellness and health issues to the employees, PACE (Platform for Accelerated Career Experience) through CUMI providing employees to work on different projects of their choice for developing cross functional capability and improve engagement levels, Catalyst, voluntary mentoring program with CUMI where employees directly sign up for dialogues with mentors for people development.

RELATED PARTY TRANSACTIONS

The Company as per the requirements of the Companies Act, 2013 and Regulation 23 of the Listing Regulations has a Policy for dealing with Related Parties. Further, in line with the amendments made in Listing Regulations pertaining to related party transactions which are effective on prospective basis i.e. w.e.f. 1^st April 2022 onwards, the policy on dealing with related party transactions was amended to adapt to the changes.

In line with the stated policy, all Related Party transactions are placed before the Audit Committee for review and approval. Prior approval of the Committee is taken for the estimated value of transactions which are foreseen and repetitive in nature. Omnibus approval in respect of transactions which are not routine, or which cannot be foreseen

or envisaged are also obtained as permitted under the applicable laws. The list of related parties is reviewed and periodically updated as per the prevailing regulatory conditions.

The details of transactions proposed to be entered with Related Parties are placed before the Audit Committee for approval on an annual basis before the commencement of the financial year. Thereafter, a statement containing the nature and value of the transactions entered by the Company with Related Parties is presented for quarterly review by the Committee. Further, revised estimates or changes, if any to the proposed transactions for the remaining period are also placed for approval of the Committee on a quarterly basis. Besides, the Related Party transactions entered during the year are also reviewed by the Board on an annual basis.

All transactions with Related Parties entered during the financial year were in the ordinary course of business and on an arm''s length basis and hence not requiring particulars to be entered in the Form AOC-2. Further, all transactions entered into with Related Parties during the year even at arm''s length basis in the ordinary course did not exceed the thresholds prescribed under the Companies (Meetings of Board and its Powers) Rules, 2014 or Listing Regulations or the Company''s Policy in this regard and hence no disclosure was required to be made in Form AOC-2. Accordingly, there are no contracts or arrangements entered with Related Parties during the year to be disclosed under Sections 188(1) and 134(h) of the Companies Act, 2013 in Form AOC- 2. The Form AOC-2 in the prescribed format is annexed to this report as Annexure-B.

There are no materially significant Related Party transactions made by the Company with its Promoters, Directors, Key Managerial Personnel or their relatives that may have a potential conflict with the interest of the Company at large.

The Policy on Related Party Transactions as approved by the Board is uploaded on the Company''s website www.wendtindia.com. None of the Directors and KMPs had any pecuniary relationship or transaction with the Company other than those relating to remuneration in their capacity as Directors/Executives and corporate action entitlements in their capacity as shareholders of the Company.

BUSINESS RESPONSIBILITY REPORTING (BRR)

The Company''s ethical and responsible behaviour complements its corporate culture. Being a public listed company, the Company recognises that its accountability is not limited only to its shareholders from a financial perspective but also to the larger society in which it operates. During the year 2019-20, consequent to the mandatory reporting of its business responsibility initiatives under the Listing Regulations, the Company had formulated a consolidated policy on Business Responsibility which lays down the broad principles guiding the Company in delivering its various responsibilities to its stakeholders. The policy is intended to ensure that the Company adopts responsible business practices in the interest of the social set up and the environment so that it contributes beyond financial and operational performance.

A copy of the Policy is available at www.wendtindia.com and the Business Responsibility Report for the year ended 31^st March 2022 in terms of Regulation 34 of the Listing Regulations is annexed to this Report as Annexure E.

GOVERNANCEBOARD OF DIRECTORS

As on 31^st March 2022, the Board of the Company comprised six Directors of which majority (four) are independent.

Ms. Hima Srinivas who was appointed as an Independent Director held office for the first term of five years until 23^rd April 2022. The Nomination and Remuneration Committee and the Board of the Company at their meetings held on 22^nd April 2022 recommended her appointment as an Independent Director for a second term of five years from 24^th April 2022. In the opinion of the Board, Ms. Hima Srinivas satisfies the independence criteria prescribed in the Act and Rules made thereunder for appointment as an Independent Director of the Company and that she is independent of the Management. Notice in this regard under Section 160 has been received from a Member. Her detailed profile is provided in the notice convening the meeting.

Mr. M Lakshminarayan was appointed as an Independent Director of the Company on 20^th March 2018 for a period of five years with the approval of the shareholders of the Company vide an ordinary resolution passed at the 36^th Annual General Meeting held on 24^th July 2018. Since Mr. M Lakshminarayan has completed 75 years during the financial year, a special resolution under Regulation 17(1A) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 was obtained from the shareholders through postal ballot exercise on 30^th December 2021, for his continuation till the end of his present term i.e. 19^th March 2023 and for re-appointing him for another term after completion of the current tenure until 30^th November 2023.

During the FY 2021-22, at the 39^th AGM of the Company, the shareholders approved the appointment of Mr. Bhagya Chandra Rao as an Independent Director effective 22^nd January 2021.

Mr. Rajesh Khanna retires by rotation at the forthcoming Annual General Meeting and has expressed his desire to retire from the Board of the Company as a Non-Executive Director.

The Company has received declarations from all its Independent Directors confirming that they meet the criteria of independence prescribed both under the Companies Act, 2013 and the Listing Regulations. In the opinion of the Board, all the Directors appointed/re-appointed during the year are persons with integrity, expertise and possess relevant experience in their respective fields.

All the Independent Directors of the Company have registered their names in the Independent Directors Databank and had completed proficiency assessment/are exempted as required under the Companies Act, 2013 and the Rules referred therein.

During the year, the Board at its meeting held on 23^rd July 2021, based on the recommendation of the Nomination and Remuneration Committee appointed Mr. Arjun Raj P as the Company Secretary with effect from 1^st August 2021 in place of Ms. Janani T A who had resigned as Company secretary with effect from 1^st August 2021.

KEY MANAGERIAL PERSONNEL (KMP)

Mr. C Srikanth, Chief Executive Officer, Mr. Mukesh Kumar Hamirwasia, Chief Financial Officer and Mr. Arjun Raj P Company Secretary are the Key Managerial Personnel of the Company as per Section 203 of the Companies Act, 2013.

BOARD MEETINGS

A calendar of Board Meetings is prepared and circulated in advance to the Directors.

During the year, six (6) Board Meetings were convened and held in accordance with the provisions of the Act. The date(s) of the Board Meetings, attendance of the directors are given in the Corporate Governance Report forming an integral part of this report.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and the Listing Regulations, the Board carried out an annual evaluation of its own performance, the Directors individually as well as the evaluation of the working of its various Committees as per the evaluation framework adopted by the Board on the recommendation of the Nomination and Remuneration Committee. Structured assessment forms were used in the overall Board evaluation comprising various aspects of the Board''s functioning in terms of structure, its meetings, strategy, governance and other dynamics of its functioning besides the financial reporting process, internal controls and risk management. The evaluation of the Committees was based on their terms of reference fixed by the Board besides the dynamics of their functioning in terms of meeting frequency, effectiveness of contribution etc.

Separate questionnaires were used to evaluate the performance of individual Directors on parameters such as their level of engagement and contribution, objective judgement etc.

The Chairman was also evaluated based on the key aspects of his role. The performance evaluation of the

Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman, the Board as whole and the Non-Independent Directors was carried out by the Independent Directors at their separate meeting held during the year.

POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS

Pursuant to Section 178(3) of the Companies Act, 2013, the Nomination and Remuneration Committee of the Board has formulated the criteria for Board nominations as well as the policy on remuneration for Directors and employees of the Company.

The criteria for Board nominations lays down the qualification norms in terms of personal traits, experience, background and standards for independence besides the positive attributes required for a person to be inducted into the Board of the Company. Criteria for induction into Senior Management positions have also been laid down.

The Remuneration policy provides the framework for remunerating the members of the Board, Key Managerial Personnel and other employees of the Company. This Policy is guided by the principles and objectives enumerated in Section 178(4) of the Companies Act, 2013 and reflects the remuneration philosophy and principles of the Murugappa Group to ensure reasonableness and sufficiency of remuneration to attract, retain and motivate competent resources, a clear relationship of remuneration to performance and a balance between rewarding short and long-term performance of the Company. The policy lays down broad guidelines for payment of remuneration to Executive and Non-Executive Directors within the limits approved by the shareholders. Further details are available in the Corporate Governance Report.

The Board Nomination criteria and the Remuneration policy are available on the website of the Company at www.wendtindia.com.

COMPOSITION OF AUDIT COMMITTEE

The Audit Committee of the Board comprises five members out of which four are independent. Mr. Shrinivas G. Shirgurkar is the Chairman and other members are Mr. M Lakshminarayan, Ms. Hima Srinivas, Mr. Bhagya Chandra Rao and Mr. N Ananthaseshan. During the year, five Audit Committee meetings were held, the details of which are provided in the Corporate Governance Report.

COST AUDIT

Pursuant to Section 148 of the Companies Act, 2013 read with Companies (Cost Records and Audit) Rules, 2014 and amendments thereof, the Company does not fall under the category of companies required to mandatorily undertake Cost Audit. However, the Company maintains cost accounting records in respect of products of the Company.

PARTICULARS OF EMPLOYEES

The information on employees and other details required to be disclosed under Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to and forms part of this Report as Annexure D.

STATUTORY AUDITORS AND AUDITORS’ REPORT

In line with the requirements of the Companies Act, 2013, the Company, with the approval of the shareholders at the Annual General Meeting held on 24^th July 2017, had appointed M/s. Price Waterhouse Chartered Accountants LLP (Reg. No. FRN 012754N/N500016) (PWC) as the Statutory Auditors of the Company to hold office from the conclusion of 35^th Annual General Meeting until the conclusion of the 40^th Annual General Meeting.

Considering that the tenure of PWC is concluding at the 40^th AGM, the Company is required to appoint a Statutory Auditor in place of PWC, the retiring Auditor. Pursuant to Section 139 of the Companies Act, 2013, PWC is eligible to be re-appointed as Statutory Auditors for a second term of five consecutive years. The Board of Directors at their meeting held on 22^nd April 2022, based on the recommendation of the Audit Committee, have recommended the

re-appointment of PWC to hold office for a term of five years from the conclusion of the 40^th Annual General Meeting until the conclusion of the 45^th Annual General Meeting of the Company.

As required under Regulation 33 of the Listing Regulations, the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

The Report given by PWC on the Financial Statements of the Company for the year ended 31^st March 2022 is provided in the financial section of the Annual Report.

There are no qualifications, reservations, adverse remarks or disclaimers given by the Auditors in their report. During the year under review, the Auditors have not reported any matter under Section 143(12) of the Companies Act, 2013 and hence there are no details to be disclosed under Section 134(3)(ca) of the Act.

SECRETARIAL AUDIT

M/s. R Sridharan and Associates, Practicing Company Secretaries, Chennai were appointed as the Secretarial Auditor to undertake the Secretarial Audit of the Company for the FY 2021-22. The report of the Secretarial Auditor for year ended 31^st March 2022 is annexed to and forms part of this Report. There are no qualifications, reservations, adverse remarks or disclaimers given by the Secretarial Auditor in the Report.

In terms of Regulation 24A of the Listing Regulations, there is no material unlisted subsidiary incorporated in India. Material unlisted subsidiary for the purpose of this Regulation is a subsidiary whose income/net worth exceeds 10 per cent of the consolidated income/net worth respectively of the Company and its subsidiaries in the immediately preceding accounting year. Hence, the requirement prescribed under Regulation 24A of the Listing Regulations is not applicable to the Company, in so far as material subsidiary is concerned.

SECRETARIAL STANDARDS

The Company is in compliance with the Secretarial Standard on Meetings of the Board of Directors (SS-1) and Secretarial Standard on General Meetings (SS-2).

CORPORATE GOVERNANCE

In terms of Regulation 34(3) read with Schedule V of the Listing Regulations, a separate section on Corporate Governance including the certificate from a Practising Company Secretary confirming compliance is annexed to and forms an integral part of this Report.

CEO/CFO CERTIFICATE

Mr. C. Srikanth, Chief Executive Officer and Mr. Mukesh Kumar Hamirwasia, Chief Financial Officer have submitted a certificate to the Board on the integrity of the financial statements and other matters as required under Regulation 17(8) of the Listing Regulations.

VIGIL MECHANISM UNDER WHISTLE BLOWER POLICY

The Company has a well-established whistle blower policy as part of vigil mechanism for Directors and employees to report concerns about unethical behaviour, actual or suspected fraud or violation of the Company''s Code of conduct or ethics policy. This mechanism also provides for adequate safeguards against victimisation of Director(s)/employee(s) who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee in exceptional cases. The Whistle blower policy is available on the Company''s website at www.wendtindia.com. It is affirmed that during the year, no employee was denied access to the Audit Committee.

ANNUAL RETURN

The Annual Return in Form MGT 7 is available atwww.wendtindia.com.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(3)(c) of the Companies Act, 2013, the Board, to the best of its knowledge and belief and according to the information and explanations obtained by it confirm that:

• in the preparation of the annual accounts for the year ended 31^st March 2022, the applicable accounting standards have been followed and there have been no material departures from the same.

• they have selected appropriate 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 as at the end of the financial year and of the profits of the Company for that period.

• proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

• the annual accounts have been prepared on a going concern basis.

• proper internal financial controls have been laid down to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

• proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO

The information on energy conservation, technology absorption, expenditure incurred on Research & Development and forex earnings/outgo as required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is annexed to and forms part of this Report as Annexure A.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company and its future operations.

OTHER CONFIRMATIONS

No application under the Insolvency and Bankruptcy Code, 2016 (IBC) was made on the Company during the year. Further, no proceeding under the IBC was initiated or is pending as at 31^st March 2022.

There was no instance of one-time settlement with any Bank or Financial Institution.

ACKNOWLEDGMENTS

The Board gratefully acknowledges the co-operation received from various stakeholders of the Company viz., customers, suppliers, partners, banks, government and other statutory authorities, auditors, business associates and shareholders. The Directors extend their gratitude to all the regulatory agencies like SEBI, Registrar of Companies, stock exchanges and other Central and State Government authorities/agencies, vendors and subcontracting partners for their support. The Board also acknowledges the unstinted co-operation, commitment and dedication made by all the employees of the Company in the previous financial year.

The Directors also wish to place on record their gratitude to the members of the Company for their unrelenting Support & Confidence.

On behalf of the Board For Wendt (India) Limited

Place: Hosur Shrinivas G Shirgurkar

Date: April 22, 2022 Chairman

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Mar 31, 2018

TOTHE MEMBERS OF WENDT INDIA LTD

The Board of Directors have pleasure in presenting the 36th Annual Report of the Company together with the Audited Financial Statements for the year ended 31st March 2018. The Management Discussion & Analysis Report which is required to be furnished as per SEBI (Listing Obligations and Disclosure Requirements) Regulations 201 5 has been included in the Directors Report to avoid duplication and repetition.

ECONOMIC OVERVIEW

According to the International Monetary Fund (IMF), the global economy is experiencing a near synchronous recovery. Roughly three-quarters of the countries experienced improvements in their growth rates. The recovery is driven by improvement in world trade in goods and services, upswing in commodity prices, accommodative monetary policies in advanced regions, buoyant demand conditions, etc. However, there are geopolitical and geo-economics risks due to war in the Korean peninsula; political upheaval in the Middle East; aggressive output cuts by Saudi Arabia (and Russia) which could force oil prices even higher; China’s unprecedented credit surge in the form of capital controls, and tradetension.

India can be rated as among the best performing economies in the world as the average growth during the last three years being around 4 percentage points higher than global growth and nearly 3 percentage points higherthan that of Emerging Market and Developing Economies.

The Indian Government underlines that due to the launch of transformational Goods and Services Tax (GST) reform on July 1, 2017, resolution of the long-festering Twin Balance Sheet (TBS) problem by GST Go Live sending the major stressed companies for resolution underthe new Indian Bankruptcy Code, implementing a I major recapitalization package to strengthen the public sector banks, further liberalization of FDI and the export uplift from the global recovery, the economy began to accelerate in the second half of the year. The Central Statistics Office (CSO) has estimated the GDP growth to be 6.5% in 2017-18. Also, India improved its ranking by 30 spots on the World Bank’s Ease of Doing Business rankings.

COMPANY PERFORMANCE OVERVIEW

(Rs in Lakhs)

	FY 2017-2018	FY 2016- 2017
Sales	12,685	12,779
Other Income	685	543
Profit Before Tax	1,651	1,570
Profit After Tax	1,230	1,169
Earnings per Share - Rs	61.49	58.47

RESULTS OF OPERATIONS

Your company achieved a Top line of Rs.12685 Lakhs, compared to Rs.12779 Lakhs (net) during the previous year. While On the export front, we have achieved an appreciable growth of 28%, with increase in demand from major countries like China, UK, Russia, Thailand, Korea, Indonesia, Singapore, etc. However, the domestic business has seen a de-growth because of shrinkage in demand in some of the markets. The major contributory industry segments in the domestic business which had their adverse impact on your company’s sales are Defense, Steel, Cutting Tools, Engineering Sector.

Your Company continued its efforts on pursuing business in its major verticals namely Super abrasives and Machines and Components. The current slowdown being considered temporary and in keeping with your Company’s longterm growth, would continue to commit the required investments and resources in identified growth areas.

The Super Abrasives business vertical consisting of Diamond/CBN grinding Wheels in various bonding systems.

Rotary Dressers, Stationary Dressers, Hones and Segmented products witnessed a growth of 4% over the last year mirroring the growth of the key industrial segments. This has been possible due to continued focus by your Company on the development of new products and new applications. Your company successfully launched new products such as Glass grinding wheel for Structural, Solar and Automotive Glass, Resin Bond Spiral CBN Wheels for Razor Blade grinding. Double Disc Fine grinding Wheels for certain Ceramic, Automotive and Engineering applications. During the year company launched Standard products underStar Brand.

The Machines and Components business performance was lower than previous year mainly due to softening of demand on Components from certain Auto Component manufacturers. While Machine sales in the export market achieved an impressive growth of 63%. The domestic sector faced brunt of Capex postponement/ Capex freeze resulting in lower machine sales during the year. However, your company continued to develop & launch new models /variants like Twin Spindle Honing Machine (E3500), Straight Wheel Head Cylindrical Grinding Machine (Precigrind) and CNC Profile Dressing Machine (PDM 400). These Machines have been received well by the customers, and the company expects to get good business in coming years.

On the Precision Components front, your Company has successfully completed and added new components for both existing and new customers. These components have received the final approval for the bulk supplies during the fourth quarter. Your company also focused on de-risking & enhancing the product basket by adding components for Non-Auto Industry, and Non - Ferrous components. These initiatives have started yielding results and is expected to contribute exponentially to the overall precision component business in coming years.

FOCUS ON PROCESS EFFICIENCY

Your company continues to drive Lean Practices in both Manufacturing and Support functions for improving operational efficiency. This initiative has benefitted in addressing some of the key areas like Productivity & Process improvement. Effective planning & Scheduling, improving Reliability of Delivery, maintaining outsourcing cost, controlling cost on Consumables, WIP and Raw material inventory.

One of the key focus of your company has also been on Sweating of the assets and thereby ensuring effective utilization, reducing dependency on sub-contracting for core processes and working round the clock or 3 Shifts basis for major product group. Your company has taken special initiative to reduce overall cost in value chain by re allocating common machines and facilities of all product cells and doing all precision machining internally, while outsourcing only Non-Precision machining. This also helped in having a control on capexspend.

FUTURE PROSPECTS

Super Abrasive Tooling Industry and Grinding & Honing Machine Industry performance is driven by GDP growth, with major demand primarily coming from Auto, Engineering sector. Steel, Glass and Cutting Tools industry. Besides this with the emergence of Aerospace, Defence and Infrastructure sector. Tooling & Machine Tool Industry is expected to benefit this industry immensely.

Further, TheMake in India initiative, too is expected to propel requisite growth in coming years.

Your company continues its focus on product and process innovation for delivering superior performances and sustainable growth. Adoption and deployment of appropriate technologies for indigenous Bond development, streamlining processes, introducing automation in critical areas and working on industry 4.0 would also be the key focus areas for the year to address the growth for your Company.

The Company would continue to seize new business opportunities in new growing industrial segments by addressing New Products for existing & new Markets and geographies.

Future growth of your company lies in constantly watching and monitoring changes in the external environment and customer needs that are emerging. Accordingly, your company has been tracking the Mega trends and underlying new opportunities that unfolds. The company accordingly, would continue focusing on new products for industry segments such as Construction, Aerospace, Defense, Infrastructure and allied industries. Your company would fully complement these efforts and maximize the benefits by participation in major national and international exhibitions, trade shows, including digital initiatives and collaborations.

The acquisition of Winterthur Technology Group (WTG) by the US multinational 3M Corporation and resultant indirect acquisition of 40% equity shareholding in your Company continues to be a matter of contention while not being an issue. The matter has been moved to The National Company Law Tribunal (NCLT), Bangalore and matter remains sub-judice.

SUBSIDIARY COMPANIES

Wendt Grinding Technologies Limited, Thailand

Your company’s 100% owned Thailand subsidiary, Wendt Grinding Technologies Limited, has yet again delivered sustained results in line with the plan both in terms of sales and profitability, despite continued industry slowdown, falling export and political issues and all odds. It is a demonstration of its strong resolve and business acumen challenging the unfavorable conditions.

During the year, your subsidiary achieved sales of Thai Baht 946 Lakhs (Rs.1844 Lakhs), 12% growth over last year. Profit After Tax of Thai Baht 141 Lakhs (Rs.283 Lakhs), a creditable growth of 32% over last year.

Your subsidiary maintained its dominant position in re-profiling business in Thailand for glass industry with its 70% share of business, where it operates. The subsidiary, during the year, focused on exploring new opportunities in Indonesia market. The focus on enhancing the product basket, new customer additions, etc. have yielded good results.

Your subsidiary continues to participate in the important Industrial and Trade Exhibitions & prospecting for new businesses, while strengthening networking with industry leaders for business promotion and development.

Wendt Middle East FZE, Sharjah

Wendt Middle East FZE, Sharjah, the other wholly owned subsidiary of your company, has clocked an annual sale of AED 23 Lakhs (Rs.412 Lakhs) which is 8% lower than the previous year. The lower topline is attributable to the continuing oil crisis, political disturbance and a slowdown in new projects in the region. Also, due to the worsening credit situation in the Middle East, the subsidiary has been cautious in growing the topline. Accordingly, the Profits have also been lower at AED 0.4 Lakhs (Rs.7 Lakhs).

During the year, your subsidiary has embarked on strategic initiatives to consolidate and grow its business with focus on industrial ceramic products and non-standard abrasive and super abrasive products. The subsidiary’s increased focus on these strategic initiatives with robust receivables management is expected to deliver results in the coming year.

APPROPRIATIONS

Available for appropriation	(Rs in Lakhs)
Profit After Tax	1230
Add: Other Comprehensive Income	36
Add: Balance brought forward from previous year	4326
Total	5592
Recommended appropriations
Transfer to General Reserve	130
Dividend
-Interim Rs 10/-per share	200
-Final (Dividend paid for 2016-17 Rs 1 5/- per share of face value of Rs 10/- each)	300
Dividend Tax
-Interim	41
-Final (for 2016-17)	61
Balance carried forward	4860
Total	5592

CORPORATE SOCIAL RESPONSIBILITY

Inclusive growth and Sustainable Community development are strong pillars of your Company’s responsible corporate citizenship. Your Company being a part of the Murugappa Group has been upholding this tradition by allocating a part of its income for carrying out its social responsibilities.

Your company’s Skill Development Program has been a major initiative towards addressing the social responsibility. The main objective being to provide high quality vocational and technical training towards uplifting the lives of young children from underprivileged community and weaker sections of the society. This training program is designed based on the coaching methodology defined by Government of India, Ministry of Skill Development and Entrepreneurship. This program also includes stipend payment along with free meals and providing boarding facilities to the enrolled students, ensuring that they earn while they learn. Not only does this initiative help in imparting formal education, but also helps them in honing them to become a valuable citizen & while help them in seeking gainful employment upon successful completion of the course.

The company continues to make contributions to the society extending to communities in its vicinity like to local schools, orphanages, homes for destitute, etc. This is based on your company’s firm belief that an organization’s true value lies beyond its business and is reflected by the services it extends to the society. Your company also gives importance to green environment and tree plantation in the nearby communities by holding seminars, educating and distributing and planting free saplings every year.

The company employees are encouraged to participate in activities like blood donation camps, taking classes on computer education in municipality schools, bring awareness on road safety, nominating employees with RTO as traffic warden, 5S campaigns towards the cleaner environment, imparting special education to the school children to name a few.

In accordance with requirements of the Companies Act 2013, your Company has a CSR policy incorporating the requirements therein which is also available on Company’s website at the following link http://www.wendtindia.com/pdf/csrpolicv.pdf

Your company, during the year 2017-18 has spent of Rs 32.36 Lakhs towards the CSR activities in line with the provisions of the Companies Act, 2013.

The Annual Report on CSR activities in the prescribed format is annexed herewith as ANNEXURE C.

DIVIDEND

The Company has voluntarily adopted the Dividend Distribution Policy as approved by the Board in line with the SEBI (Listing Obligations and Disclosure Requirements) Regulations 201 5 and the same is available on Company’s website viz. www.wendtindia.com.

In line with the policy, the Board of Directors has recommended a Final Dividend of Rs 1 5/- per equity share of face value Rs 10/- each (1 50%) for the year ended 31 st March 2018. This is in addition to the Interim Dividend of Rs 10/- per equity share of face value of Rs 10/- each which was paid on 19th February 2018.

The Final Dividend, is subject to approval of members at the 36th Annual General Meeting & will be paid to those shareholders whose names appear on the register of members of the company as on 1 st August 2018. If approved, the total Dividend for the financial year, including the interim dividend, amounts to Rs 25/- per equity share and will absorb Rs 602 lakhs including dividend distribution tax of Rs 102 Lakhs.

TRANSFER TO RESERVES

Your Company proposes to transfer Rs. 130 lakhs to the General Reserve. An amount of Rs. 4941 Lakhs is proposed to be retained in the Statement of Profit & Loss.

FIXED DEPOSITS

During the year, the Company has not accepted deposits from the public falling within the ambit of Section 73 of the Companies Act, 2013 and the rules framed thereunder.

INVESTMENTS

Details of investments covered under section 186 of the Companies Act 2013 are given in the note no. 6 to the financial statements.

TRANSFER TO THE INVESTOR EDUCATION & PROTECTION FUND

In terms of Section 124 (5) of the Companies Act, 2013, an amount of Rs. 3.78 lakhs being unclaimed dividend during the year, pertaining to the financial year 2009-10 was transferred to IEPF after sending due reminders to the shareholders.

CONSOLIDATED FINANCIAL RESULTS

The Consolidated Financial Statements of the company (incorporating the operations of the Company and its two wholly owned overseas subsidiaries), for the financial year 2017-18 are prepared in compliance with the applicable provisions of the Companies Act, Accounting Standards as prescribed by Regulation 33 of the Securities and Exchange Board of India (SEBI) (Listing Obligations and Disclosure Requirements) Regulations, 201 5. The Consolidated Financial Statements have been prepared based on the audited financial statements of the company, its subsidiaries, as approved by their respective Board of Directors.

Pursuant to provisions of Section 136 of the Act, the Financial Statements of the Company, the ConsolidatedFinancial Statements, along with the relevant documents and the Auditors’ Report thereon form part of this Annual Report. A statement of summarized financials of all subsidiaries of your company including capital, reserves, total assets, total liabilities, details of investment, turnover etc. pursuant to General Circular issued by MCA forms part of this report. The audited annual accounts and related information of the subsidiaries is available in our website-www.wendtindia.com.

The key financial data for the consolidated operations are as follows: -

KEY CON SO LI DATED FINANCIAL SUMMARY

(Rs in Lakhs)

	FY2017-2018	FY 2016-2017
Sales	14,432	14,466
Other Income	492	313
Profit Before Tax	1,804	1,657
Profit After Tax	1,312	1,205
Earnings per share-Rs.	65.62	60.26

QUALITY

Your Company manufactures products that embed a high level of precision and accuracy as demanded by the customers of various industry segments. While the Super Abrasives Product range consists of Diamond & CBN Grinding Wheels and Special Tools; the Machines includes customized range of high precision machines such as CNC Grinding, Notch Milling, TC Ring Grinding, Honing and Accessories fulfilling the requirements of international standards and including CE certifications. Precision Components are manufactured with significant degree of precision and very precise, close tolerances necessitating them to passing through the stringent quality standards and measurements through the stringent production process and control.

To ensure that your company meet this requirement. Quality Management standards are put in place such as ISO 9001 and TS 16949. TS 16949 pertains to manufacturing of precision components. Further, in order to comply with the safety norms and requirements of overseas customers, your company has also successfully implemented EN 13236 Standards. Quality being the uncompromised differentiator for your Company, the company attempts hard to ensure that final product quality is built by deployment and embracing effective quality control management, process robustness, quality assurance and discipline at every stage of material flow.

The Company continues to place higher emphasis on training in latest trends besides investment in high-end equipment, machineries & application software and modern tools.

SAFETY, HEALTH AND ENVIRONMENT (SHE)

Your company accords high importance towards safety and health of employees and ensures that the work environment is conducive for smooth operations. Towards this, the top management stays ever committed for maintaining high standards for safety, health and environment management by being fully compliant to applicable statutory requirements as per OHSAS 18001 and ISO 14001 EMS standards and guideline.

During this year, the company has upgraded to new standard on Social accountability SA 8000:2014 and adopted a new Standard on product safety EN-13236:2010 A1:201 5 for meeting Safety requirements of the European standard of Super Abrasive products. Every year, Wendt observes a Safety Week with sprawling events spread over the week to emphasize on importance of safety to the employees. This year it was held on 5th March 2018 which included competitions on slogans, posters, skits, and mock drills.

Recognizing that the employees are the most valuable assets of your company and that the Safety and Health of each employee is of utmost importance. The company continues to undertake initiatives and pursue programs, including Annual health check-up for employees and their family, special medical attention for employees working in special process & sensitive areas. The company conducted special awareness program on use of personal protection equipment (PPEs), zero discharge of ETP/STP and hazardous waste handling, so that the employees and their family maintain good health and overall wellness.

Your company continues to periodically conduct safety mock drill and various training programs to educate and prepare towards chemical, electrical and medical urgencies.

RECOGNITIONS AND AWARDS

The employees are encouraged to participate in customer audits, group competitions, various national and international events & competitions. Your Company continues to get accolades and awards from its customers and other prestigious domestic/international forums. Some of the awards and recognitions your Company received during the year under review:

- “Regional Award for Export Excellence” Conferred with “Star Performer- Large Enterprises” for outstanding export performance during year 2015-16 by Engineering Export and Promotion Council

- Lean Management Practices

Conferred with Silver Award for Lean Management Practices from ABK AOTS

- Quality Circle Awards

Your Company’s employees continued to exhibit their skills in various Quality Circle competitions as below International Level: Organized by QCFI, Philippines

- ”Gold” Award in ICQCC for Kaizen-1 team

National Level: Organized by QCFI, Hosur

- ”Gold” Award for Kaizen in CCQC- 4 teams

- ”Gold Award” for SGA (Small group Activity) in CCQC: 2 teams.

- MGTC Volley Ball Tournament

Your company’s employees participated in the Group Level Volley Ball tournament and won the “Winners” Trophy during the year.

- MGTC Women Sports Tournament

Your company’s women employees participated in the Group level sports competition and won awards in Carom, Chess and Relay competitions.

- Cufest 2017 Awards

Your Company’s employees participated in Group-level Quality competition “Cufest 2017” (Quality Festival of CUMI), and won awardsfor5S, Poster, Innovation, Idea King, SGAand Theme Video

RELATED PARTY TRANSACTIONS

All related party Transactions that were entered during the financial year were on arm’s length basis and were in the ordinary course of business. During the year, there were no materially significant related party transactions made by the Company with Promoters, Directors, key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

In line with the provisions of Section 177 of the Companies Act, 2013 read with the Companies (Meetings of the Board and its Powers) Rules, 2014, prior omnibus approval for the estimated value of transactions with the related parties for the financial year is obtained from the Audit Committee. The transactions with the related parties are routine and repetitive in nature. The summary statement of transactions entered into with the related parties pursuant to the omnibus approval so granted are reviewed and approved by the Audit Committee and the Board of Directors on a quarterly basis.

The Policy on Related Party Transactions as approved by the Board is uploaded on the Company’s website.

None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company.

GOVERNANCE BOARD OF DIRECTORS

The Board of Directors have appointed Mr. M Lakshminarayan as an Additional Director on the Board of the Company with effect from 20th March 2018 and he holds office till the date of the ensuing Annual General meeting. The Company is proposing to appoint him as an Independent Director under section 149 of the Companies Act, 2013 for a term of 5 years. Mr. Lakshminarayan has offered himself for this appointment. The Company has received a notice from a shareholder proposing his candidature as Director in the ensuing Annual General Meeting.

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. K Srinivasan, Director retires by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment. The necessary Resolution is being placed before the shareholders for approval. The Board of Directors of your company believes that his continued association with the Board will be beneficial to the company and recommends his re-election.

All the Directors of the company have confirmed that they are not disqualified from being appointed as directors in terms of Section 164 of the Companies Act, 2013. All the independent Directors have given a declaration under section 149(6) of the Companies Act 2013, confirming their independence.

KEY MANAGERIAL PERSONNEL

Mr. Rajesh Khanna, Chief Executive, Mr. Mukesh Kumar Hamirwasia, Chief Financial Officer and Ms. Akanksha Bijawat, Company Secretary continue to be the Key Managerial Personnel of the Company as per Section 203 of the Companies Act, 2013 and there were no changes during the year.

BOARD MEETINGS

A calendar of Board Meetings is prepared and circulated in advance to the Directors.

During the year, five Board Meetings were convened and held in accordance with the provisions of the Act. The date(s) of the Board Meeting, attendance by the directors are given in the Corporate Governance Report forming an integral part of this report.

COMMITTEES OF THE BOARD

In compliance with the provisions of Sections 135, 177, 178 of the Companies Act, 2013, the Board constituted Corporate Social Responsibility Committee, Audit Committee, Nomination and Remuneration Committee and Stakeholder Relationship Committee (Committees). The details of composition of the Committees, their meeting and attendance of the members are given in the Corporate Governance Report forming an integral part of this report.

BOARD EVALUATION

Pursuant to the provision of the Companies Act, 2013 and Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board had carried out an annual evaluation of its own performance, the Directors individually and the Committees of the Board. Structured assessment forms which were duly reviewed were used in the overall Board evaluation process comprising various aspects.

The manner in which evaluation has been carried out has been explained in the Corporate Governance Report.

REMUNERATION POLICY

The Board has framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration policy is stated in the Corporate Governance Report.

PARTICULARS OF REMUNERATION

The information required pursuant to Section 197(12) of the Act read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended by the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016 and forming part of Directors report for the year ended 31 st March 2018 is annexed in Annexure D.

STATUTORY AUDITORS AND AUDITORS’ REPORT

Pursuant to the provisions of Section 139 of the Companies Act 2013 and the rules framed thereafter. M/s Price Waterhouse, Chartered Accountants LLP, were appointed as Statutory Auditors for a term of 5 consecutive years at the 35th Annual General Meeting of the Company held on July 24, 2017, subject to ratification of their appointment at every AGM.

M/s Price Waterhouse, Chartered Accountants LLP, have furnished a certificate of their eligibility as per Section 141 of the Companies Act, 2013.

The Report given by M/s Price Waterhouse, Chartered Accountants LLP on the Financial Statements of the Company for the year ended 31st March 2018 is provided in the financial section of the Annual Report. There are no qualifications, reservations, adverse remarks or disclaimers given by the Auditors in their report. The notes on the accounts referred to in the Auditors’ Report are self- explanatory and do not call for any further comments.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Act, and the Rules framed thereunder, the Company has appointed Ms. Apeksha Nagori, Practicing Company Secretary to undertake the secretarial audit for the financial year 2017-18. The Report of the Secretarial Auditor confirming compliance with the applicable provisions of the Companies Act 2013 and other rules and regulations issued by SEBI/other regulatory authorities forms part of the Annual Report.

The Company also adheres to the various Secretarial Standards issued by the Institute of Companies Secretaries of India.

CORPORATE GOVERNANCE

Your Company has inculcated strong culture of values, ethics and integrity living with the Five Lights- The Spirit of Murugappa Group. The Governance Philosophy of your Company is firmed up on a bedrock of ethical values and professionalism which in more than 3 decades of the Company’s existence has become a part of its culture. Wendt (India) Limited, looks upon good Corporate Governance practices as a key driver of sustainable corporate growth and long-term stakeholder value creation.

The Company practices and policies reflect true spirit of Corporate Governance initiatives.

In terms of Regulation 34(3) read with Schedule V of the Listing Regulations, a separate section on Corporate Governance including the certificate from a Practicing Company Secretary confirming compliance is annexed to and forms an integral part of this Report.

CEO/CFO CERTIFICATE

The Chief Executive and the Chief Financial Officer have submitted a certificate to the Board on the integrity of the financial statements and other matters as required under Regulation 17(8) of the Listing Regulations.

VIGIL MECHANISM UNDER WHISTLE BLOWER POLICY

The Company has a well-established whistle blower policy as part of vigil mechanism for Directors and employees to report concerns about unethical behavior, actual or suspected fraud or violation of the Company’s Code of conduct or ethics policy. This mechanism also provides for adequate safeguards against victimization of Director(s)/employee(s) who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee in exceptional cases.

EXTRACT OF ANNUAL RETURN

The extract of the Annual Return in form MGT 9 as required under Section 92(3) of the Act and the Rules framed thereafter is annexed to and forms part of this report. (FORMAT IN ANNEXURE B).

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(3) (c) of the Companies Act, 2013, the Board of Directors of your Company, make the following statements, to the best of their knowledge and belief and according to the information furnished and explanations obtained by them:

- That in the preparation of the annual financial statements for the year ended 31 st March 2018, the applicable accounting standards have been followed and there have been no material departures therefrom.

- That they have selected appropriate 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 as at the end of accounting year and of the profits of the Company for the year ended 31 st March 2018.

- That proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

- That the annual financial statements have been prepared on a going concern basis.

- That proper internal financial controls have been laid down to be followed by the company and that such internal financial controls are adequate and were operating effectively.

- That proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO

The information on energy conservation, technology absorption, expenditure incurred on Research & Development and forex earnings/outgo as required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is annexed to and forms part of this Report (refer Annexure A).

ACKNOWLEDGEMENTS

Your Board of Directors would like to place on record their sincere appreciation for the cooperation received from various stakeholders of the Company viz., customers, suppliers, bankers, investors, government and other statutory authorities, auditors, business associates and shareholders. Your Directors extend their gratitude to all the regulatory agencies like SEBI, Registrar of Companies, stock exchanges and other Central and state Government authorities/agencies, vendors and sub-contracting partners for their support. The Board also acknowledges the unstinted co-operation, commitment and dedication made by all the employees of the Company.

The Directors also wish to place on record their gratitude to the members of the Company for their unrelenting support & confidence.

By order of the Board

For Wendt (India) Limited

Place: Bengaluru M M Murugappan

Date: 25th April 2018 Chairman

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Mar 31, 2017

REPORT OF THE DIRECTORS

(Including Management Discussion and Analysis)

TOTHE MEMBERSOFWENDTINDIALTD

The Board of Directors is pleased to present the 35th Annual Report of the Company together with the Audited Financial Statements for the year ended 31st March 2017. The Management Discussion & Analysis Report forms part of the Directors Report to avoid duplication and repetition.

ECONOMIC OVERVIEW

During the year 2016-17 the Indian economy witnessed upsurge in economic activities both in private and government sector, resulting in positive sentiments and strengthening demand conditions in domestic market. Both Global and Indian economy now seem to be in a much better shape than earlier years. The key factors supporting the confidence are rapid recovery from demonetization-related down turn, softer inflationary pressures, proposed GST Roll out and public-sector disinvestments.

The Indian economy achieved a moderate growth of around 7.1% during the year because of increase in manufacturing activities except for the temporary dip due to demonetization effect witnessed during second half of the year. Strengthening of investor''s I confidence including foreign direct investments is strongly seen in some I of the key areas such as defense production, electronics component I manufacturing, medical devices as well as in non-manufacturing sectors | like insurance and professional services. Despite the temporary dip during _the third quarter, the automobile sector, overall, ended the year on a positive note on account of new launches by leading manufacturers reporting corresponding sales growth during the year.

Reflecting the overall optimism, other industry segments such as Engineering, Refractory, Ceramics, Cutting Tools and Glass have also achieved reasonable growth over the previous year. On the contrary, India''s overall export continued to be lower than expected due to falling prices of metals and commodities & world oil prices. World trade has been shrinking as demand in key American and European markets has slowed down and remained sluggish. Moreover, Brexit and consequent depreciation of the British pound has put Indian exporters in a difficult situation due to volatility in currency and increasing competition from low cost economies.

	FY 2016- 2017	FY 2015- 2016
Sales (net of excise duty)	12,779	11,655
Other Income	543	648
Profit Before Tax	1,570	1,499
Profit After Tax	1,169	1,041
Earnings per Share - Rs	58.71	52.06

RESULTS OF OPERATIONS

During the year under review, your company achieved a Top line of Rs.12779 Lakhs (net), which is 10% higher compared to the previous year by putting its best efforts both in the domestic and export market. The demand for your company''s products and services in the domestic market has seen reasonable traction from industry segments such as Automobile, Auto component. Ceramics, Cutting Tools and Engineering resulting in a growth of 17% over the previous year. However, the export business has seen a de-growth of 8% on account of shrinkage in demand in some of the advanced markets and overall continued slow recovery. Your company continued its efforts in addressing the challenges in some of the overseas markets such as USA,

Russia, Thailand as well as countries in the European market which have greatly contributed to achieving the above results despite uncertainties.

Your Company continues to conduct its business under three clearly Defined business verticals such as Super Abrasives, Non-Super Abrasives and International Business. Your company also recognizes the importance of the "Make in India" campaign started '' by the Indian Government two years back and the growth opportunities it would provide for your company from the ongoing investments, innovation, adoption of new methods and technologies by customers, providing the much-needed impetus for

- Higher growth. Accordingly, your company continues to allocate the required investments in high growth areas and other resources to attain its long-term business objectives. Your company continues putting focused efforts in enhancing its presence in ten identified countries for growing it''s exports. On domestic front, your company continues to focus on top 200 customers having significant contributions to your company''s overall business.

During the year, your company actively participated in the IMTEX 2017 exhibition where it showcased its products and capabilities to both the Domestic & the international audience including launch of four new models of machines during the exhibition.

The Super Abrasive Business consisting of Diamond/CBN grinding Wheels in various bonding systems. Rotary Dressers, Stationary Dressers, Hones and Segmented products achieved a growth of 14% as compared to the previous year amidst many challenges and high competition in both domestic and overseas markets. This has I been possible through continued efforts and various initiatives for new application and product developments addressing import substitutions. Your company successfully launched new products such as Dressing Rolls for Taps and bearing applications, Resin Bond Spiral CBN Wheels for Razor Blade grinding. Double Disc Fine grinding Wheels for certain Ceramic, Automotive and Engineering applications. Vitrified CBN Wheels for internal grinding applications. During the year, your company successfully completed integration of the STAR Diamond Business into its operations and commencement of regular production from Hosur. The renovation of the Electroplating facility was also undertaken cater to the increased demand in terms of higher quantity & precision. Today you can claim of Wendt having one of the most modern and state-of-the-art Plating facility in the world.

Your Company continues to work on strengthening its Research and Development Centre by enhanced efforts in Bond / Matrix formulations towards building self-reliance on the technological front. Accordingly, your company has added new capabilities and competencies towards development of new applications / products for various industries such as Glass, Auto component. Ceramics etc. during the year.

The Non-Super Abrasive Business comprising of Machine Tools & Precision Components performance was about 4% lesser than previous year. Although machine sales in the domestic market achieved an impressive growth of 40% on the back of good orders from various customers, the exports sawa negative growth.

During the year, your company has launched many new models / variants which includes four new CNC machines - Wheel Dressing & Profiling Machine, Creep Feed Grinder, Cylindrical Grinder with Angular Wheel Head and Cylindrical Grinder

with Straight Wheel Head apart from developing Vertical Honing Machine - Twin spindle with Robotics and Horizontal Honing Machine with added features. These Machines have been received well by the customers and the company expects to a positive response from the market.

The Precision Components Business, during the year, faced few challenges in terms of lower volume off take by the customers due to slow revival in auto sector and delay in getting final approvals for starting the new projects. As a result, the performance of precision components was 11 % lower than the previous year.

Nevertheless, company''s efforts in enhancing the product basket by adding components for non-auto and non-metallic sectors have started generating business for the company, although in smaller volume during the year. It is expected to contribute in a major way to the overall precision component business in coming year.

In order to strengthen the precision component business, the company is in various stages of approval on testing of some of the new components with few potential customers and expects to start the business in the current year.

FOCUS ON PROCESS EFFICIENCY

Your Company continues to focus on improving operational efficiency as well as optimal utilization of various resources in manufacturing and production areas. This is being supported through continuing implementation of LEAN for last three years. This initiative has been found beneficial in addressing some of the key areas like planning and scheduling, production reliability, materials availability and product delivery. One of the key objectives is the elimination of waste through optimum usage of all critical resources. The lean management is a philosophy and way of life for deriving long terms benefits by elimination of non-value-added activities, effective utilization of resources and helps in garnering higher level of customer satisfaction.

As part of continuing LEAN, your company has started driving this end to end whereby all support functions are also brought into its domain as important enablers for achieving organizational results.

Some of the major benefits are

- Reduced lead time for products

- Reduced Work in Progress

- Effective Raw Material Planning

- Controlling inventory levels

- Improved employee productivity

PROSPECTS

Your Company continually works on narrowing the gap between its strategies and objectives based on the market dynamics to achieve the set goals and improved performance year on year through various initiatives. The company recognizes the fact that high level of focus on product and process innovation, careful selection and deployment of new technologies and processes are critical to achieve its long-term objectives. Your company accordingly works on improving product performance by use of technology & superior manufacturing methods towards meeting the objective.

While the existing products would continue to be offered, new products, new application developments including development on import substitutes would be the focus for your company for growth. Together with, efforts of market penetration to increase the share of business with top customers, both domestic and overseas would continue. Your company would continue to work on enhancing it''s competitive edge, through improving capability, service levels and offering value added services. This would ensure higher performance & improved engagement with the customer.

Future growth of your company lies in constantly watching and monitoring changes in the external environment and customer needs that are emerging. Accordingly, your company has been working on the mega trends and underlying new opportunities that these trends unfold & is constantly focusing on new products to address this trend in all concerned industry segments.

Your Company would fully complement these efforts by maximizing it''s participation in major national and international exhibitions & trade shows & will continue to put efforts and initiatives towards increasing the global presence in identified countries through strategic alliances and co-operations besides taking advantage of the CUMI Distribution network & its ‘focus on digital marketing .

The acquisition of Winterthur Technology Group (WTG) by the US multinational 3M Corporation and resultant indirect acquisition of 40% equity shareholding in your Company continues to be a matter of contention while not being an issue. The matter has been moved to The National Company Law Tribunal (NCLT), Bangalore and matter remains sub judice.

SUBSIDIARY COMPANIES

Wendt Grinding Technologies Limited, Thailand

Your company''s 100% owned subsidiary Wendt Grinding Technologies Limited, Thailand, has achieved a topline of Thai Baht 857 Lakhs (Rs.1645 Lakhs) which is at the same level as the previous year, despite continued downtrend, political instability, declining export and rising costs in the region. The Profit Before Tax was Thai Baht 131 Lakhs (Rs 265 lakhs) and the Profit After Tax 1 has been Thai Baht 104 Lakhs (Rs.214 Lakhs) which is - 12% higher than previous year.

Like previous years, continued initiatives & efforts has been the key to this performance sustainability of your subsidiary company. New customer additions and widened product basket have compensated for the decline in automotive sector and related industries. In addition to constantly looking for new opportunities, enhancing product basket, the new projects being envisaged would help your subsidiary to achieve better performance in the coming year.

Your subsidiary continues to take part in the important Industrial and Trade Exhibitions, exploring new businesses and strengthening networking with industry leaders for business promotion and development.

Wendt Middle East FZE, Sharjah

The second wholly owned subsidiary of your company, Wendt Middle East FZE, Sharjah, has achieved a reasonable performance for the year under review despite the continuing oil crisis, political disturbance and slowdown in new projects in the region. During the year, the subsidiary has achieved an annual sale of AED 25 Lakhs (Rs.449Lakhs) which is 20% lower than the previous year. As such, the Profits have also been lower at AED 2.87 Lakhs (Rs.52 Lakhs) which is at 40% level as compared with that of previous year despite its best efforts.

As mentioned earlier, the manufacturing sector in the whole region has been undergoing severe pressure due to lower demand, underutilized capacity, rising costs etc. & due to continuing socioeconomic issues, higher inflation and regional disturbances with very few new investments by the Government.

To address these challenges, your subsidiary continues to put its best efforts and has taken many new initiatives, adding new customers and industries apart from enhancing the product basket and offering to achieve better results in the coming year.

APPROPRIATIONS

Available for appropriation	(Rs in Lakhs)
Profit After Tax	1169
Add: Balance brought forward from previous year	3995
Total	5164
Recommended appropriations
Transfer to General Reserve	120
Dividend
-Interim Rs 10/-per share	200
-Final (Dividend paid for 201 5-16 Rs 1 5/- per share of face value of Rs 10/- each)	300
Dividend Tax
-Interim	41
-Final (for 201 5-16)	61
Balance carried forward	4442
Total	5164

CORPORATE SOCIAL RESPONSIBILITY

For your company, corporate social responsibility remains as one of the key areas along with transparency. The company continues to make contributions to the society that is not limited but extends to communities in the vicinity, local schools, orphanages, homes for destitute etc. This is based on your company''s firm belief that an organization''s true value lies beyond its business and is reflected by the services it extends to the society. Your company also gives importance to green environment and tree plantation in the nearby communities by distributing and planting free saplings every year.

Your Company''s running of the Skill Development Centre has been a major initiative towards addressing the social responsibility. The main objective being providing of high quality vocational and technical training towards uplifting the lives of young children drawn from poor and deprived background. Not only does this initiative helps continuance of formal education for these apprentices, but also helps them to seek gainful employment and leading a meaningful life upon successful completion of the course.

With the enactment of CSR provisions in the Companies Act 2013, your Company has put in place a CSR policy incorporating the requirements therein which is also available on Company''s website at the following link http://www.wendtindia.com/pdf/csrpolicy.pdf

You’re Company, during theyear2016-17. Has spent of Rs 32.34 Lakhs towards the CSR activities in line with the provisions of the Companies Act, 2013,.

The Annual Report on CSR activities in the prescribed format is annexed herewith as ANNEXURE II.

DIVIDEND

The Board of Directors of the Company had approved the Dividend Distribution Policy on 20th March''2017 in line with the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. The policy is uploaded in the Company''s website www.wendtindia.com.

In line with the policy, the Directors are pleased a recommend a Final Dividend of Rs 1 5/- per equity share of face value Rs 10/-each (150 %) for the year ended 31st March 2017. This is in addition to the Interim Dividend of Rs 10/- per equity share of face value of Rs 10/- each which was paid on 22nd February 2017.

The Final Dividend is subject to approval of members at the 35th Annual General Meeting & will be paid to those shareholders whose names appear on the register of members of the company as on 1st August 2017. If approved, the total Dividend for the financial year, including the interim dividend, amounts to Rs 25/- per equity share and will absorb Rs 602 lakhs including dividend distribution tax of Rs 102 Lakhs.

TRANSFER TO RESERVES

Your Company proposes to transfer Rs. 120 lakhs to the General Reserve. An amount of Rs. 4443 Lakhs is proposed to be retained in the Statement of Profit & Loss.

FIXED DEPOSITS , _M

Your Company has not accepted any fixed deposits during the year 2016-17 and as such, there are no outstanding fixed deposits from the public as on 31 st March 2017.

INVESTMENTS

Details of investments covered under section 186 of the Companies Act 2013 are given in the notes no 6 b to the financial statements.

TRANSFER TO THE INVESTOR EDUCATION & PROTECTION FUND

Pursuant to the provision of Section 124 of the Companies Act, 2013, your Company has transferred an amount of Rs.1.71 lakhs (Interim Dividend 2008-09) and Rs.1.88 lakhs (Final Dividend 2008-09) being unclaimed dividend during the year, to the Investor Education and Protection Fund (IEPF) established by the Central Government after sending due reminders to the shareholders.

CONSOLIDATED FINANCIAL RESULTS

The Consolidated Financial Statements of the company (incorporating the operations of the Company and its two wholly owned overseas subsidiaries), for the financial year 2016-17 are prepared in compliance with the applicable provisions of the Companies Act, Accounting Standards as prescribed by Regulation 33 of the Securities and Exchange Board of India (SEBI) Regulations-201 5, under Listing Obligations and Disclosure Requirements (LODR).

The Consolidated Financial Statements have been prepared based on the audited financial statements of the company, its subsidiaries, as approved by their respective Board of Directors.

Pursuant to provisions of Section 136 of the Act, the Financial Statements of the Company, the Consolidated Financial Statements, along with the relevant documents and the Auditors'' Report thereon form part of this Annual Report. A statement of summarized financials of all subsidiaries of your company including capital, reserves, total assets, total liabilities, details of investment, turnover etc. pursuant to General Circular issued by MCA forms part of this report. The audited annual accounts and related information of the subsidiaries is available in our website-www.wendtindia.com.

The key financial data for the consolidated operations are as follows: -

KEY CONSOLIDATED FINANCIAL SUMMARY

(Rs in Lakhs)

	FY 2016-2017	FY2015-2016
Sales (net of excise duty)	14,466	13,335
Other Income	313	381
Profit Before Tax	1,657	1,580
Profit After Tax	1,205	1,078
Earnings pershare-Rs.	60.26	53.88

QUALITY

The most critical aspect of the products that are offered by your company are high precision, accuracy and assurance of quality in terms of exacting standards required by the customer including the functionality for the desired applications.

Your Company''s Super Abrasives product range comprises of Diamond & CBN grinding wheels and Tools in various bonding systems. The Machine Tools & Precision Component business include a range of machines such as Rotary Surface Grinding, Notch Milling, TC Ring Grinding, Vertical & Horizontal Honing, Cylindrical grinding & accessories that are fully compliant with the International standards and CE certification fulfilling the European safety norms. Precision Components being a part of Non-Super Abrasives business, requires high level of precision and close tolerance limits necessitating utmost care and adherence to quality parameters and process controls.

To ensure that your company''s products meet these requirements, your company has put in place the necessary Quality & Management standards such as ISO 9001, ISO 14001, TS 16949, OHSAS and SA 8000. Your company has also successfully implemented EN 13236 Standards to address the safety norms and requirements of overseas customers. All of these standards are regularly reviewed and upgraded based on the changing requirements of global customers & are audited and certified by TUV& concerned certifying Body at regular intervals.

Superior quality and consistency in performance of the products being the main differentiators, you company has ensured deployment of an effective Quality Management System (QMS) and practice at each stage of material flow in the manufacturing cycle. Needless to mention that, your company endeavors to enhance quality and consistency in every aspect of its business on a continual basis. Accordingly, it accords high importance and care while imparting training on New Processes, New Technologies & Newer methods to its employees in the respective areas.

The necessary investments on machines, equipment & application software solutions are also being done to update & address Quality Standards. To improve on our product delivery Reliability and quality on time delivery, your company has successfully completed implementation of Bar Coding System in most of the production areas during the year.

SAFETY, HEALTH AND ENVIRONMENT (SHE)

Your Company is highly committed towards good health and workplace safety for its employees. The company makes sure that the workforce follows the safety standards and practices religiously so that the work environment is safe and free from accidents, incidents and any occupational hazards.

With respect to Environment Management, preservation and maintenance, your company is committed to and accords high importance to this aspect both within the company and the neighborhood as well. The senior management takes responsibility for this and due efforts are made to keep a close watch on maintaining the required safety standards and protection of environment through deployment of relevant processes and guidelines in line with ISO 14001 and OHSAS 18001 standards.

As mentioned above, your company considers its employees as the most valuable assets and gives utmost importance to their sound health and adopts good safety practices. The company continues to take various initiatives and programs such as annual health check-up, eye camp, cardio test, fitness and physiotherapy including awareness trainings so as to ensure good health and wellness of the employees and their families.

Your Company periodically conducts safety mock drills to address employee''s awareness & preparedness towards fire, chemical, electrical & medical urgencies.

You will be pleased to know that your company has again recorded Zero accident with no loss of man days in its operations during the year. During the year, your company has successfully upgraded to latest SA8000-2014 standards, which is more rigorous as compared to the earlier version. Your company is one of the few companies in the country to have implemented this standard.

RECOGNITIONS AND AWARDS

Your Company continues to motivate the employees to pitch in several national & international competitions. As in the past, the company has received many awards and recognitions and accolades from organizations and establishments of repute. Needless to mention that these recognitions and accolades enhance the passion and optimism among the employees and act as confidence builder for the Company.

During the year, your company has received the following major awards.

- Quality Circle Awards

Your Company''s employees continued to exhibit their skills in various Quality Circle competitions as below

International Level organized by ICQC, Thailand

- "Gold" Award for Kaizen-1 team

- "Silver" Award for SGA-1 team

National Level organized by NCQC

-"Par Excellence Award"-SGA: 1 team

- "Excellence Award" - Kaizen: 1 team

- Pride of Murugappa Group-Best Practice

Your Company''s employees have won the 2nd Runner Up

Award on Customer Centricity Category in the Pride of Murugappa Group - Best Practice. The annual best practice competition at the group level, involving large number of initiatives and best practices among all group companies.

- MGTC Cricket Tournament

Your company''s employees participated in the Group Level Cricket tournament and won the "Winners" Trophy during the year.

- MGTC Women Sports Tournament

Your company''s women employees participated in the Group level sports competitions and won awards in Carom, Chess and Relay competitions.

- Cufest 2016 Awards

Your Company''s employees participated in Group-level Quality competitions "Cufest 2016" (Quality Festival of CUMI), and won awards for 5S, Poster, Slogan, Kaizen and CFT.

! MANAGEMENT DISCUSSION AND ANALYSIS REPORT

In the sections that follow, the information required to be given in the Management Discussion and Analysis Report have been provided.

GENERAL PERFORMANCE REVIEW

i The Indian economic conditions have started seeing improvements and positive sentiments among various sectors resulting in a modest growth in some of the I industry segments including manufacturing. However, the pace of recovery has been rather slower than expected.

During the year, your company continued to put its best efforts on new initiatives and new product & application developments in addition to working as closely as possible with customers for new opportunities including import substitutions to maintain its leading position in the domestic market.

ECONOMIC OUTLOOK

There seems to be lot of optimism and improved confidence across all the industrial segments. The proposed GST Rollout, the controlled inflation, the disinvestment drive, supported by Government reforms and initiatives is likely to propel demand and the resultant manufacturing & servicing activities.

For the coming year, the Indian economy is expected to achieve a growth rate in excess of around 7.5% as per various reports and studies by leading agencies. Several important performance indicators including index of industrial production (IIP) and wholesale price index (WPI) have shown upward movement in last few quarters. In recent years, the government has embarked upon many initiatives towards ease of doing business including the Make in India campaign, attracting foreign direct investments, reforms in banking sector, skill development, infrastructure development etc. These initiatives are expected to significantly enhance the purchasing power of people and the resultant increase in consumption demand boosting the socio-developmental activities in the country.

The industry sectors that are likely to derive benefit from the above initiatives are Automotive, Engineering, Construction, Aerospace, Defense, Infrastructure, Mining, Roads, Railways, Power, Steel, Consumer Durables & Electronics during the coming year.

INDUSTRY STRUCTURE & DEVELOPMENTS

Your Company continues to be preferred supplier for Super Abrasive Tooling for many customers including several MNCs. With the wide product range and comprehensive offering in terms of products, capability and industry | segments, your company is recognized as Total Grinding & Honing Solution Provider. The Indian Super Abrasive tooling market is fragmented in nature and continues to operate in a highly competitive environment with the presence of few organized players such as your Company and a host of proprietor- driven units, which are often single owner, small set-ups mainly with regional focus. Major contribution to your Company''s top line continues to come from sectors such as Automotive, Engineering, Cutting Tools, Refractory & Ceramics, Steel, Aerospace and Defense, which are likely to derive the benefit from government initiatives briefed above.

To reduce dependency on few industry segments, your company is persistently working on developing products for varied industry segments having long term growth prospects. Your company''s effort in this direction has resulted in development of many new products towards addressing the changing needs of the industries like Automobile, Aerospace, Defense, Glass, Paint, Razor Blade, Ceramics.

PERFORMANCE OVERVIEW

Key Financial Summary _{(Rs in Lakhs)}

Particulars	2016-17	2015-16	% change
Domestic Sales including excise duty	10,891	9,315	17
Export Sales	3,019	3,301	-9
Total Sales	13,910	12,616	10
Operating Profit before Finance cost	1,209	1,014	19
Capital Employed	10,243	9,744	5

OPPORTUNITIES & THREATS Opportunities:

Your Company takes due cognizance of the economic growth prospects and its importance on its overall performance. Nonetheless, it would continue its pursuit and drive for higher growth year on year on the back of its industry spread, product range, technological edge and I competitiveness for seeking new opportunities in the industry segments it operates. Secondly, the wide range of products and its comprehensiveness provides enough room for accelerating growth. Developing products and aligning the business with the strong signals of Mega trends would be another area of focus for your company going forward.

The bedrock for success for your company has been its long and accumulated experience in offering products and services based on the application study and deep understanding of customer requirements. In this, superior technology continues to play important role for both Super Abrasive tooling and Grinding & Honing machines. This has complemented well towards our manufacture of precision components for our demanding customer. Your company would continue to leverage this unique advantage and derive maximum benefits from being the provider of Total Grinding & Honing Solutions which only few can aspire to have.

As a part of continuous journey, your Company would continue to work on the identified new projects in Super Abrasive tooling. Machines Tools and Precision components several of which are already in the pipeline. As for precision components, it holds lot of promise and potential to become a separate business vertical very soon and the company has been working on projects having high possibility of making significant positive impact on the overall performance in the near future.

Threats

As mentioned earlier, the Super Abrasive tooling market in the domestic arena is entrenched with the presence of few organized players and host of small & unorganized players. While on one side, these small enterprises, focus on specific markets and addressing customer requirements with lower prices and continue to cater to a set of customers with limited offering, on the other side, the large organized players from both domestic and global arena focus on technology, application engineering and product developments. The global players tie up as OEMs with machine manufacturer that

I always benefit them in terms of ready access to the business right from the beginning.

Your Company addresses this unique challenge, by I adopting its proven and tested technology, processes & I delivery system, offering economical and innovative I products for both, the low-end price sensitive customers I and the high-end quality conscious segment. The focus on I technology, value added services, application engineering I and product development including prove-out by joining hands with the customers , remains the value proposition J for your company providing it a distinctive edge .

i BUSINESS OUTLOOK

While the business environment presents many uncertainties, and remains challenging, your Company''s primary focus would continue to maintain its leadership position in the domestic arena. Increasing the presence in the identified overseas markets with suitable offerings specific to meet the customer needs is another important area for accelerating export business growth. Improving customer engagements and satisfaction levels will be ensured by improving awareness about the company.

knowledge about products and services, brand recall, prompt value added services, participation in both Domestic & International exhibitions and regular visits & interactions.

In the Super Abrasive Business, your Company will continue to focus on existing key products, new product development, new application engineering including product indigenization for achieving the growth objectives it has set for itself. While doing so, the company''s focus would be on maintaining the fine balance between stability and capitalizing on the new and emerging opportunities. The recently acquired STAR Business has been successfully integrated into the company''s operations and the same is expected to make significant contributions to the overall growth of your company in the future.

Non-Super Abrasive Business is in the process of consolidation by strengthening its position in the market, applications, industry in terms of its range/ models/ new launches and offering. The population of machines in the domestic market is steadily increasing and the numbers are expected to further increase in coming years. For the coming year too, your company has planned launch of few new machines for engineering, ceramics, aerospace and cutting tool industry.

Your Company is putting its best efforts to strengthen the precision component business with addition of new components and new customers. Your company has planned addition of few more precision components including the distance piece project in the coming year.

Growing the International Business and establishing its presence firmly and as quickly as possible continues to be one of the focus areas for your company. While it would continue

to pursue business through the existing Wendt / 3M and CUMI''s overseas network, to increase the market reach and higher penetration, your company would work on strategic partnerships & alliances to grow business in various global locations, also would explore adding new partners by looking at newer opportunities. Towards this, your company has also identified Top 10 Focus Countries for growing exports. As you may be aware, your company has already started promoting its products under CUMI & Neutral Brand as well as private label with a view to expand its presence in overseas markets.

Your 100% owned subsidiary Wendt Grinding Technologies Ltd, in Thailand would continue to achieve better results year on year despite being affected by muted global recovery, auto industry downtrend, lower demand, falling exports and political instability. As is evident in the past, the subsidiary shows steadfastness and confidence for achieving the results in the coming year. To accelerate its growth, your subsidiary company has been looking at few new projects in the coming year for which the finer specifics including the potential benefits are under evaluation.

Your second fully owned subsidiary, Wendt Middle East FZE, Sharjah has been consistent in its performance over the last tew years. For the last two years, the business environment in the region has been challenging in items of I political issues, war, downslide in oil price, stalled projects | and very few new investments and project expansions. I Despite these difficulties and hardships, your subsidiary I continues to put all its efforts on certain markets and I industries that have given good results during these tough I times. Your subsidiary would continue to operate as the I Product Availability Point (PAP) for the entire GCC region I with focus on General Engineering, Aerospace, Steel, I Ceramics, Auto component & associated industry segments and holds enough promise for better performance in the coming year.

RISK & CONCERN

Risk management is a very important part of the Company''s business policy. Your Company''s Risk Management structure spans across different levels whereby the Company continuously identifies, classifies and formulates mitigation measures.

I Your Company adopts a comprehensive and robust risk

- Appraisal, mitigation and management process in the areas of I operations, financial, technology and other business risk. The senior management of your Company is involved in mapping

- The risks arising out of both internal and external environment I and initiate plans to mitigate the same. The key risk I management practices include risk assessment, measurement, ] reporting, mitigation actions and integration with strategy | and business planning.

The key risks associated with the various processes of the Company''s business are analyzed in detail, identifying cause and source of the risk, logical sequence of triggering events i.e. (Key Risk Indicators), positive and negative consequences and the likelihood of occurrence of such consequences, the severity of the impact, both in quantitative and qualitative terms. The Key Risk Indicators are mapped to the job functions of the respective executives and the reporting and monitoring frequencies are also defined.

The Risk management process for your Company encompasses the following sequence:

- Identification of risks with the associated risk owners

- Evaluation of the risks as to the likelihood of occurrences and related consequences

- Assessment of options for risk mitigation

- Prioritizing the risk management actions

- Development of risk management plans

- Authorization for the execution of the risk management plans

- Implementation and review of the risk management process

Your Company has a Risk Management Committee comprising of Senior Management which takes the overall responsibility of total risk management processes in the organization. Through its pursuit of anticipation and

identifying risks before risks control your company''s actions, the Risk Management Committee of your Company analyses the potential areas of risks and on the current business portfolio and decides which business should receive more focus, where to invest, what needs to be added or discontinued from the product portfolio etc. to mitigate the risks.

Your Company continuously strives to identify, assesses, review, manage and works on developing the robustness of the system in terms of adequate internal controls and compliances. Some of the risks associated with the business and the related mitigation plans are given below. However, the risks given below are not exhaustive and the assessment of risk is based on management''s perception.

User Industry Concentration Risk

Why is it considered as a Risk

- Significant exposure to select sectors like auto & auto ancillaries.

- Time lag in passing cost escalation / variations in input costs to the customers.

- Effect on Customer Relationship with change in ownership. ''

- Decline in demand due to Global economic slowdown.

- Cessation of technology agreement and access to new '' process & product developments in the Super Abrasive field.

- Rebranding of products and the resultant delay in brand establishment.

- Disruptive innovation & process changes.

Mitigation Plan / Counter Measure to address

- Widening the customer base/ new industry segment & new geographies thereby De-risking the business.

- Exploring growth opportunities in sectors like Construction, Infrastructure, Steel, Defense, Aerospace, Glass, Ceramics and other industries.

- Improving the on-time delivery levels through operational efficiency measures like LEAN addressing the sustained competitive advantage.

- Continuously pursuing product innovation and new application development for diverse sectors.

- Leveraging relationship and Engagement with the customer - e.g. WOW initiative / Exhibitions like IMTEX, participation in international exhibitions like GRINDTEC -Germany, MAC - United Kingdom, IMTS - USA, CIMT -China, CRM & Knowledge Management application.

- Setting up of In-house DSIR approved R&D center. Also, thrust on innovation with focus on New Product Development, is now well embraced at Wendt to yield long term results.

- Developing and promoting alternative brands-one being well known "CUMI" brand and now alternately STAR brand.

- Entering new geographies globally.

- Focus on Make in India.

Competition Risk

Why is it considered as a Risk

- Cheaper Imports from countries like China and Taiwan.

- Import directly and through OEM route.

- Presence of many unorganized regional players often adopting Low pricing strategy, free samples, higher credit days etc.

- New Organized Players entry by setting up manufacturing base in India consequent to Make in India Drive.

Mitigation Plan / Counter Measure to address

- Offer sustained competitive advantage to customer through operational efficiencies

- Focus on Lean & Address QCD - Superior Quality, Cost competitive products & Reliable, Faster Delivery

- Internal Efficiency Measures/process automation/Reduce through put time

- Continued drive on Innovation on products, process and applications

- Creating entry barriers for competition / exit barriers for customers - Key Account Management

- Increased focus on New product development

- Enhancing value added services

- Increasing the product basket & offerings

- Building agile Supply chain by capitalizing on CUMI dealer network

- Explore E-Commerce and online sales

- Automation and Robotization to address Lower manufacturing cost and enhance Competitiveness

Technology Risk

Why is it considered as a Risk

- The rapid changes taking place in the fields of grinding /honing technology and material science.

- Adoption of Disruptive technologies like 3D printing.

- Access to New Alternate technology following the expiry & Non- renewal of technical collaboration agreement with Wendt GmbH post Sept 2012.

Mitigation Plan / Counter Measure to address

- Indigenous development of Bonds with external consultant support,

- Collaboration with external consultants

- Established DSIR approved R&D center and build on self-sufficiency in technology

- Association with external Research laboratories/Technical institutes for technology upgradation.

- Product and Process Innovations

HR & Legal Risk

Why is it considered as a Risk

- Attrition of skilled/trained manpower leading to disruption of operations or knowledge gap

- Contractual liability, e.g. Product liability Mitigation Plan / Counter Measure to address

- Inauguration of Knowledge Management Portal whereby all major established applications are safely documented

- Succession planning

- Career Development

- CCSD (CUMI Centre for Skill Development) providing employable technicians

- Compensation revision in line with the market

- All contracts cleared by the Legal team

Online Data & Information Security Risk

Why is it considered as a Risk

- Data breach leading to loss and critical information infrastructure breakdown Mitigation Plan / Counter Measure to address

- Policy in place for Technical Controls

- Business Continuity Plan and Disaster Recovery Strategy in place.

- Authorized access to the Data center

- Crisis Management Group in Place.

INFORMATION TECHNOLOGY

One of the key success factors for your company''s sustainability and consistent operations has been the use of technology and SAP ERP system, thus leveraging on the benefits for smooth functioning and steady flow of information across various functions.

Your Company has been working on the project of IT enabled Knowledge Management System which is expected to further facilitate the company''s application engineering capabilities and offering technology solutions to the customers worldwide. This initiative is slated to become fully functional during the coming year. During the year, your company has completed the implementation of Closed Circuit TV Surveillance Camera (CCTV) project as part of pre-empting any untoward incidence and further enhancing safe work practices of its employees. Implementation of Bar Coding Facility for on-line work completion and monitoring in the key production areas is one of the major milestones for your company during the year.

INTERNAL CONTROL SYSTEM & ADEQUACY

The Company has adequate internal controls consistent with the nature of business and size of its operation, to effectively provide for safety of its assets, reliability of financial transactions with adequate checks and balances, adherence to applicable statutes, accounting policies, approval procedures and to ensure optimum use of available resources. These measures are regularly reviewed and updated by incorporating changes in the regulatory provisions. These are regularly tested for their effectiveness by Statutory as well as Internal auditors. Material errors and irregularities are detected and prevented in time. Your company is committed in its endeavor & ensures an effective internal control environment that provides assurance on the efficiency and effectiveness of operations, reliability of financial reporting, statutory compliance.

Your Company''s Capital and revenue expenditures are monitored and controlled with reference to approved budgets. Budget overrides, if any is brought to the notice of the Board and suitable actions is taken to control the expenditure.

The internal audit function is carried by external independent Chartered Accountant firm covering all operational areas and ensuring that Revenue is correctly deployed and there is no wastage / leakage of any resources. The Internal Audit firm reports to the Chairman of the Audit committee. The scope of the Internal Audit is firmed up with inputs from the Audit Committee, Board of Directors, Statutory auditors and the Company management to ensure that all the critical areas are covered. Significant audit observations and corrective & preventive actions thereon are presented to the Audit Committee.

During the year, there were no changes in internal control over financial reporting that have materially affected, or are likely to have any financial reporting lapse.

The company strives to align all its processes and controls with the best global practices.

Internal Controls Over Financial Reporting (ICFR)

Your Company has in place adequate internal financial controls commensurate with its size, scale and complexity of its operations. During the year, such controls were tested and no reportable material weakness in the design and operations were observed. The company has policies and procedures in place for ensuring proper and efficient conduct of its business, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

Your Company has a comprehensive Budgetary Control system to monitor revenues and expenditure against approved budgets on an ongoing basis.

The Company has adopted accounting policies which are in line with the Accounting Standards and the Act. These are in accordance with generally accepted accounting principles in India. Changes in policies, if required, are made in consultation with the Auditors and are approved by the Audit Committee.

The Company has a robust financial closure, certification mechanism for certifying adherence to various accounting policies, accounting hygiene and accuracy of provisions and other estimates.

FINANCIAL REVIEW Earnings Revenues

During the year, your company achieved total sales of Rs.13910 Lakhs, higher by 10% as compared to 2015-16. While the domestic sales recorded a robust growth of 17% over the last year at Rs.10891 Lakhs, the export sales were lower by 9% compared to the previous year at Rs.3019 Lakhs. As briefed earlier, the major industry segments which contributed to the growth of domestic business are engineering, cutting tools, steel, defense, trading and ceramics. The de-growth in export was due to lower sales to countries like Germany, Indonesia, Singapore, Middle East etc. during the year.

Profit before Tax

The profit before tax is higher by 5% at Rs.1 570 Lakhs compared to Rs.1499 Lakhs in 2015-16. The higher profit is because of the improved product and process efficiency measures taken by the Company and control over the fixed cost.

Profit after Tax

The profit after tax is higher by 12%, at Rs.1169 Lakhs, compared to Rs.1041 Lakhs in 201 5-16.

Liquidity and Cash Equivalents

Your company continues to be debt free company, maintaining sufficient cash and cash equivalents to meet its strategic initiatives. This is achieved by being prudent in its investment policy over the years, maintaining a reasonably high level of cash and cash equivalents which enable the company to completely eliminate short and medium term liquidity risks.

The Company has a robust Cash Management Policy whereby it:

a. Conserves sufficient cash as reserves to aid the company in venturing into meaningful business opportunities that unfold during the year.

b. Use cash to provide sufficient working capital to address business objectives of the company & to add value to all stakeholders by continued enhancement.

c. Prudently Invest surplus funds that the business generates in debt schemes of mutual funds as per Group norms and prior approval from the Board. This ensures availability, safety and liquidity of Company''s funds while allowing reasonable yield as per the prevailing market rates. The surplus funds are generated through stringent control on working capital.

During the year, your company''s investment in mutual funds increased from Rs.930 Lakhs to Rs.1072 Lakhs as on 31 st March 2017 ie. a growth of 1 5%.

As the earnings are ploughed back, the capital expenditure need of your company for the year was met entirely form the mutual funds investment.

Costs

Your Company has done judicious cost control whereby the fixed costs excluding depreciation has grown by 3% compared to last year. Thereby, the fixed cost as percentage of sales has been controlled at 32% against 34% of last year.

The variable costs have been controlled during the year through indigenization of raw material and other input costs which has helped in improving the margins of the company. The Lean Management Initiative undertaken by your company has also helped in significant savings during the year. Your Company''s price correction initiative from both customer’s domestic and exports and key suppliers during the current year is expected to improve its profitability in the coming year.

Financial Position Share Capital

The paid-up equity share capital as on March 31, 2017 was Rs.200 Lakhs. During the year under review, the Company has not issued shares with differential voting rights nor granted stock options nor sweat equity.

Share-holders Funds

The shareholders fund as on 31.03.2017 was Rs.10243 Lakhs against Rs.9744 Lakhs of previous year, an increase of 5%. Accordingly, the book value of the share stands at Rs.512/- as compared to Rs.487/- during the previous year.

Loan Funds

Your Company Continues to utilize its cash credit limit with State Bank of India to bridge the short-term fund requirement and for meeting the temporary mismatches in its cash flow. Your Company does not have any interest-bearing term loan.

During current year too, the working capital limits of your Company continues to be rated by ICRA as AA-(pronounced ICRA double A minus) rating assigned to the Rs.2 crore Long term Fund facilities of your Company which signifies low credit risk and stable. The short Term Rating assigned to the Rs 6 crore Non-Fund Based working capital limit also continued to be reaffirmed as A1 (pronounced ICRA A one plus). Overall your Company''s rating continues to be stable and low credit risk.

ASSETS FIXED ASSETS

Your Company continues with the policy of being prudent in its capex spend. During the current year, the capital expenditure was Rs.986 Lakhs. The major capex spent was on addition of new plant & machinery towards capability building in fast growing products and new products capacity enhancements, which are critical for the future growth of the company. Company continued to adopt policy of funding all the capex through the internal accruals.

Inventories and Sundry Debtors

The Company follows rigorous Working Capital Management, based on a well-organized process of continuous monitoring and control on Receivables, Inventories and other parameters. The overall inventory levels as on 31st March 2017 is Rs. 1844 Lakhs, an increase by 3% over the last year, despite sales growing by 10%. There was an increase in the Work In Process inventory by Rs.157 Lakhs due to delay in dispatch / clearance for from few customers.

Receivables as on 31 st March 2017 were at Rs. 2872 Lakhs against last year''s figure of Rs.2907 Lakhs, despite sales growth of 10%. This has been possible due to continuous monitoring and control measures adopted by the company. Despite the tough liquidity position post demonetization drive, your Company has been able to maintain the receivable average credit days at 79 days similar to previous year. This is possible through aggressive receivable management system including close follow ups and credit lock through the SAP system to ensure that receivables are kept under control and payments received in time.

Foreign Exchange Hedging

Your Company, being a net exporter, continues to follow the policy of natural hedging of foreign exchange earnings and outflow and hence it does not take any forward covers. The net forex gain during the year has been Rs.20 Lakhs.

Enhancing Shareholder Value

Your Company firmly believes that its success in the marketplace and a good reputation are among the primary determinants of value to the shareholder. The organizational vision is founded on the principles of good governance and by the resolve to be a customer centric organization which motivates the company''s management to be aligned to deliver highly customized products with dependable after sales services.

Your Company is committed to creating and maximizing long-term value for shareholders and essentially follows a four-pronged approach to achieve this end.

a) By increasing all round operational efficiencies

b) By identifying strategies that enhance its competitive advantage

c) By managing risks and pursuing opportunities for profitable growth, and

d) By building relationship with other important stakeholder groups through meaningful engagement processes and mutually rewarding associations that enable it to create positive impacts on the economic, societal and environmental dimensions of the Triple Bottom Line.

Underlying this is also a dedication to value friendly financial reporting that assures the shareholder and investor of receiving transparent and unfettered information on the Company''s performance.

Financial Performance with respect to Operational Performance

Your Company strives to keep its Operating profit and Contribution better than the industry average and record reasonable growth despite difficult economic situation. This is ensured by stringent control measures taken for improved operational efficiency led by the LEAN Initiative undertaken by your company, also the better product mix made its'' due contribution. This was aided by accurate information & customer data, centralized drawing management system, better planning & scheduling through SAP ERP System and effective vendor management. Your Company''s improved MIS reporting and ability to respond to customer with real time information helped in giving rich experience to the customers there by providing value addition to the customer.

INSURANCE

Your company continued its adequate care on providing required insurance cover for your company''s asset buildings, plant and machinery including inventories, and for liabilities under legislative enactments. Besides, adequate Group Personnel Accident (GPA), Group Mediclaim (GMC) insurance coverage is taken for the employees and their dependents to cover the risk arising out of accidents or sickness.

HUMAN RESOURCE

The people policies and practices of your company are effectively aligned to the organizational goals and objectives. Your company has in place the well-established human resource processes for attracting, retaining and nurturing talent by adopting a transparent system of performance evaluation and rewarding performers. This has been evident from the fact that your company''s employees have longer average tenure and low attrition rate. Individual KRAs are derived from the Business Plan & annual BSC (Balanced Score Card) and carefully deployed at all level, which are reviewed periodically.

To sustain its leadership position in India, your company finds it pertinent to remain customer-focused, performance-driven and future-capable. Your Company''s Human Resource Development strategy seeks to fulfill this mandate through careful selection and effective implementation of a range of innovative programmes and interventions. Needless to mention that the human resource policies of your company ensure motivation to the employees to give their best and remain committed to achieve the overall objective of the company. It is a constant endeavor for your company to adopt some of the industry best practices and aligning them with the strategic directions, goals and objectives in terms of people processes.

Your Company''s Human Resource policies are continuously reviewed and realigned based on people expectations, making it more employee-friendly thereby creating an engaged workforce which focuses on productivity.

To meet the growth plans set by the Company and to fulfill the ever-changing needs and expectations of the customers, your Company continues to focus on competency building, skill enhancement and overall development so that its people are well prepared to take on the challenges.

Every employee of your company is considered as an appreciating asset, thus the personal development plans focus on how each individual''s strength can be best leveraged to deliver to his/her full potential. To this effect, your company provides specific training programmes and cross functional learning opportunities. The company attains high degree importance to enhancing employees'' competency and skills through on the job training and external training programmes. Special attention is given on improving the health and safety of the employees.

Your Company focuses on Business Excellence and continual improvement journey (TQM) in its quest to improve the quality of products, processes and systems. All this requires ongoing learning, job enrichment, aligning rewards and recognition with performance, high engagement levels, conducive work environment and a cordial industrial relationship. Your Company continues to have a smooth and enabling work climate that promotes performance, customer focus and innovative thinking while adhering to the highest standards of integrity, trust and ethical behavior. Your Company continues to enjoy the support of a committed, experienced and satisfied workforce. To this effect, your company offers a compensation package which is one of the best in industry.

Employee relations continue to be smooth and cordial and the work atmosphere remained congenial throughout the year. The manpower strength of confirmed employees of your company as on 31 st March 2017 was 370.

RELATED PARTY TRANSACTIONS

All related party Transactions that were entered into during the financial year were on arm''s length basis and were in the ordinary course of business. There were no materially significant related party transactions made by the Company with Promoters, Directors, key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

All Related Party Transactions are placed before the Audit Committee for approval. Prior omnibus approval of the Audit Committee is obtained on a quarterly basis for the transactions which are of foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit Committee for their approval on quarterly basis

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

None of the Directors have any pecuniary relationships or transactions vis-a-vis the Company.

GOVERNANCE BOARD OF DIRECTORS

The Board of Directors have appointed Ms. Hima Srinivas as an Additional Director on the Board of the Company with effect from 24th April 2017 and she holds office till the date of the ensuing Annual General meeting. The Company is proposing to appoint her as an Independent Director under section 149 of the Companies Act, 2013 fora term of five years. Ms. Hima Srinivas has offered herself for this appointment.

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. K Srinivasan, Director retires by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment. The necessary Resolution is being placed before the shareholders for approval. The Board of Directors of your company feels that his continued association with the Board will be beneficial to the company and recommend his re-election.

All the Directors of the company have confirmed that they are not disqualified from being appointed as directors in terms of Section 164 of the Companies Act, 2013. All the independent Directors have given a declaration under section 149(6) of the Companies Act 2013, confirming their independence.

BOARD MEETINGS

A calendar of Board Meetings is prepared and circulated in advance to the Directors.

During the year, five Board Meetings and four Audit Committee Meetings were convened and held, the details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

BOARD EVALUATION

Pursuant to the provision of the Companies Act, 2013 and SEBI Regulations, 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, Stakeholder Relationship, CSR and Nomination & Remuneration Committees. The manner in which evaluation has been carried out has been explained in the Corporate Governance Report.

REMUNERATION POLICY

The Board has framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration policy is stated in the Corporate Governance Report.

STATUTORY AUDITORS AND AUDITORS'' REPORT

As per the provisions of Section 139 of the Companies Act''2013, the term of M/s Deloitte Haskins & Sells, Chartered Accountants, as the statutory auditors of the Company, Bangalore will conclude from the close of the forthcoming Annual General Meeting of the Company.

The Board of Directors places on record its appreciation for the services rendered by M/s Deloitte Haskins & Sells as the Statutory Auditors of the Company.

Subject to the approval of Members, the Board of Directors of the Company has recommended the appointment of M/s Price Waterhouse Chartered Accountants LLP, (ICAI Firm Registration Number. 012754N/N500016) as the Statutory Auditors of the Company pursuant to Section 139 of the Companies Act''2013.

The notes on accounts referred to in the Auditors'' Report are self- explanatory and do not call for any further comments.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Act, and the Rules framed there under, the Company has appointed M/s Apeksha Nagori, practicing Company Secretary to undertake the secretarial audit for the financial year 2016-17. The Report of the Secretarial Auditor confirming compliance with the applicable provisions of the Companies Act 2013 and other rules and regulations issued by SEBI/other regulatory authorities forms part of the Annual Report.

The explanation to the observations of the Secretarial Audit Report by the Secretarial Auditor has been furnished in the respective sections of the Corporate Governance Report.

KEY MANAGERIAL PERSONNEL

Mr. Rajesh Khanna, Chief Executive, Mr. Mukesh Kumar Hamirwasia, Chief Financial Officer and Ms. Akanksha Bijawat, Company Secretary are the Key Managerial Personnel of the Company pursuant to Section 2 (51) and Section 203 of the Companies Act 2013.

None of the Key Managerial Personnel have resigned during the year under review.

CORPORATE GOVERNANCE

Your Company has inculcated strong culture of values, ethics and integrity living with the Five Lights- The Spirit of the Murugappa Group. The Company continues to maintain high standards of Corporate Governance in all its interactions with various stakeholders. The company strives to be a sustainable and trusted organization as sustained governance is the cornerstone in building and maintaining relationship with all its stakeholders. It rigorously pursues a policy of 100% compliance with all statutory requirements and has a robust review system in place. The Board fully supports and endorses Corporate Governance practices in accordance with provisions of Regulation 27 of the SEBI (LODR) Regulations 2015. The Corporate Governance Report along-with the Auditors'' Certificate regarding compliance of the conditions of Corporate Governance pursuant to Regulation 27 of the Listing Regulations is annexed hereto and forms part of the Annual Report. To this effect, as required under Regulation 17 (8) of the SEBI (LODR) Regulations 201 5, a certificate from the Chief Executive and the Chief Financial Officer of your Company is being annexed with this Report.

VIGIL MECHANISM UNDER WHISTLE BLOWER POLICY

The Company has a vigil mechanism under Whistleblower Policy to provide necessary safeguards for protection of Directors, employees, customers, vendors from reprisals or victimization. The details of the policy are explained in the Corporate Governance Report and are also posted on the website of the Company.

Extract of Annual Return

The extract of the Annual Return in form MGT 9 as required under Section 92(3) of the Act and the Rules framed thereafter is annexed to and forms part of this report. (FORMAT IN ANNEXURE I).

RATIO OF REMUNERATION TO EACH DIRECTOR:

Details / Disclosures of Ratio of Remuneration to each Director to the median employee''s remuneration as ANNEXURE- III.

Directors Responsibility Statement

Pursuant to the provisions of Section 134(3) (c) and 134 (5) of the Companies Act, 2013, the Board of Directors of your Company, make the following statements, to the best of their knowledge and belief and according to the information furnished and explanations obtained by them:

- That in the preparation of the annual financial statements for the year ended 31st March 2017, the applicable accounting standards have been followed and there have been no material departures there from.

- That they have selected appropriate 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 as at the end of accounting year and of the profits of the Company for the year ended 31st March 2017.

- That proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

- That the annual financial statements have been prepared on a going concern basis.

- That proper internal financial controls have been laid down to be followed by the company and that such internal financial controls are adequate and were operating effectively.

- That proper systems are in place to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Disclosure of Statutory Particulars

- The particulars as prescribed under Section 134(3)(m) of the Companies Act,2013, read with Rules 8(3) of The Companies (Accounts) Rules 2014 are set out in Annexure A which forms part of this report.

- The information required under Section 197(12) of The Companies Act, 2013 read with Rules 5(2) & (3) of The Companies (Appointment & Remuneration of Managerial Personnel) Rules 2014 as amended by the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016 and forming part of Directors report for the year ended 31st March 2017 is annexed in Annexure III.

ACKNOWLEDGEMENTS

The Directors acknowledge and would like to place on record the commitment and dedication on part of the employees of your Company for their continued efforts in achieving good results. Your Directors also look forward for their continued involvement and support in future.

Your Directors would also like to express their sincere appreciation to investors, bankers, customers, suppliers, business associates, shareholders, auditors and other statutory authorities who have extended their precious continued support and encouragement to your company during the year. Your Directors extend their sincere gratitude to all the regulatory agencies like SEBI, Stock Exchanges, Registrar of Companies and other Central and State Government authorities/agencies. Stakeholders, vendors and sub-contracting partners for their support.

Finally, the Directors also wish to place on record their gratitude to the members of the Company for their Continued Support & Confidence.

By order of the Board

For Wendt (India) Limited

Place: Chennai M M Murugappan

Date: 24th April 2017 Chairman

---

Mar 31, 2015

Dear Members,

The Board of Directors has pleasure in presenting the 33rd Annual Report together with the Audited Financial Statements for the year ended 31st March 2015. The Management Discussion & Analysis Report has been included in the Directors Report so as to avoid duplication and repetition.

ECONOMIC OVERVIEW

The Indian economy has been experiencing slow revival with gradual pick-up in domestic demand after continued slowdown for last three years. Undoubtedly, both Indian & Global economy appear to be in a better shape now than by gone years. Growth projection for India in coming year remains positive, mainly due to the new Government at helm and its various growth oriented programmes being planned towards boosting the demand.

During the year, the Indian industry achieved a moderate growth of around 6% helped by positive expansion in manufacturing which witnessed similar growth in last few quarters although there is still some amount of reluctance and caution when it comes to capital investments for expansions and new projects. Negative sentiments that were affecting the Domestic consumer demand is now tapering. The performance of basic goods, intermediate goods and consumer durables has also improved mildly in last few quarters. Improved coal production and higher electricity generation during the year has helped raise the overall output for mining, cement, fertilizer, agriculture and other core industries.

The automobilesector, except the commercial vehicle segment, closed the year on a positive note despite interest costs with major companies reporting sales growth during the fiscal. While other industry segments such as Cutting Tools, Engineering, Ceramics, Glass, Refractories have achieved moderate growth over the previous year, segments like Steel have continued to be affected due to prolonged slowdown and weak global demand.

India's export continued to be positive in major export markets such as US and European countries excepting the OPEC economies which are facing Oil crisis for some time now.

The improvement in industrial output in last two quarters has signalled positive trend and has an overall favourable effect on the GDP. Although the CPI inflation is experiencing sharp rise mainly driven by higher food inflation, the edging down of core inflation has more than offset the same which has resulted in a comfortable headline inflation of around 6% - much lower than 9.5% in 2013-14.

COMPANY PERFORMANCE OVERVIEW

31st March 2015 31st March 2014

Sales 10,560 9,449

Other Income 800 611

Profit Before Tax 1,764 1,640

Provision for Tax 279 453

Profit After Tax 1485 1,187

Earnings per Share - Rs 74.24 59.34

RESULTS OF OPERATIONS

Amidst slow pace of recovery in the domestic market and weak global demand, your company continued to put its best efforts to achieve a Top line of Rs.10560 Lacs during the year under review with a growth of 12% as compared to the previous year. With the gradual pick-up in demand in the domestic market, some of the industry segments such as Automobile, Ceramics, Cutting Tools, Engineering, Refractory and Glass have positively contributed resulting in 11% growth over the previous year. On the export front, while some of the advanced countries witnessed a moderate growth, in the developing nations especially in the South East Asian region, the demand continued to remain weak due to persistent negative forces. However, your company's good efforts in addressing some of these challenges have more than offset the uncertainties resulting in a

14% growth compared to the previous year.

In the pursuit of growth and taking cognizance of medium and long term perspective, your company continues its business by focusing on three verticals- Super abrasives, Non-Super abrasives and International Business. Your company also strongly believes that the "Make in India" initiative by the Indian Government, which is slowly gaining momentum, would provide the much needed impetus for growth. Accordingly, your company continues to make necessary investments in the identified growth areas and deploy resources in order to sustain long term business growth.

Super abrasive Business comprises of Diamond/CBN grinding Wheels in various bonding systems, Hones, Diamond Dressing Rolls, Segmented products & Stationary Dressers, achieved a growth of 9% over the previous year against, stiff competition from both global and local. This above average industry growth achieved mainly on account of continued focused initiatives on new product developments & new application Areas including some of the import substitutions. During the year under review, your Company successfully launched some of new products which include Resinoid Wheels for Cutting Tools, Vitrified Products for Auto Component, Electroplated products for Engineering, Gear and Ceramics, Brazed Diamond Products for Textile and Precision Dressing Rolls for Defence, Gears and Bearing and certain other automotive applications.

Three years back your company established its Research and Development Centre and since then, it has been strengthening its capabilities and continued augmenting the efforts in Bond / Matrix formulations & development towards building self-reliance on the technological front.

During the year, your company has added new capabilities and competencies in developing some of the new applications / products for various industries. As you may be aware, your company's R & D Centre being recognized by Department of Science and Industrial Research (DSIR), Government of India also provided ample opportunity for jointly taking up research work and projects along with other well- established research laboratories on emerging technologies and new developments.

The Machine Tools & Precision Components business achieved a growth of 18% over the previous year. It has been another difficult year for the Machine Tool business due to continued capex-hold / deferment of investments on projects by the targeted customers. Despite these difficulties, the performance has rather been a decent one. During the year, your company has continued to develop & launch many new models/variants of machines including CNC Rotary Surface Grinding Machines and Honing Machines. The Company has launched 7 new machines during the year which includes Vertical Single & Double spindle

Honing machines. Angular Head Grinding machine and Surface Grinding Machine. These new models are expected to cater to a wider range of applications areas , while also increasing the customer and reference base, enhancing also the product basket. Your company has participated in IMTEX - 201 5 exhibition held at Bangalore and showcased its growing strength & Focus I on Machine Tools along with Precision Super Abrasive products.

On the Precision Components front, your company, during the year has enhanced the volume of production of two new components which got added to its basket last year. Your company is constantly exploring opportunities, where it can deploy its core competency - Expertise, Experience and Knowledge on Machines & Super Abrasive Tools for producing related precision components. Your company focuses on providing Sustained competitive advantage to its customers. Consequently your company is in advanced stage of discussion with some of the prospective customers to further strengthen the precision component business and to eventually roll it out as a separate vertical for growth, going forward.

FOCUS ON CUSTOMER CENTRICITY

Your Company has completed implementation of Customer Relationship Management (CRM) application in association with SAP. This Initiative would benefit your company in enhancing the reach and building better relationships with the customers spread not just in India but across the Globe. The CRM system will enhance the company's approach towards customer along with seamless integration of all the minute facet of marketing and sales process, which directly influence customers both in domestic and export market. Besides enhancing business relationship, it would create new opportunities for long term value creation for both customers as well as the company.

Some of the major benefits:

- Global reach through offering value proposition and effectively addressing customer needs

- Effective Knowledge Management & one-stop solution platform through integration with company's Knowledge Portal, helping the team with faster responses, real time accurate information against queries and higher productivity

- Faster and better service levels thereby strengthening company's competitive position

- 360 degree view of customers and insightful customer analysis through dashboards

FOCUS ON PROCESS EFFICIENCY

Your Company continues to invest on its journey of Lean Management in order to enhance operational efficiency and optimum use of resource in the area of manufacturing. During the year, your company has found this initiative extremely meaningful, this addresses some of the key operational areas such as process bottlenecks, process integration in quality, planning, scheduling, and production. Your company has started realising benefits by optimal utilization of machines and equipment through proper planning and scheduling of material movement besides streamlining the process in order to drive efficiency, improvement in on time delivery and waste elimination. Overall, the implementation of lean management system in your company would ensure elimination of non-value added activities, process streamlining, effective utilization of resources and higher level of customer satisfaction.

Some of the major benefits are

- Reduction in lead time for product delivery

- Reduction in rejection levels

- Better control on Work in Progress and Raw Material Planning

- Reduction in outsourcing cost

- Improved employee productivity

- Cost effective products

FUTURE PROSPECTS

Your Company continuously strives to align its Strategies and Business Objectives with the market in order to achieve better performance on a sustainable basis. Your company recognizes that focus on product and process innovation, adoption and deployment of new technologies and processes are critical in order to achieve its long term objectives.

Accordingly, your company continues to accord high level of importance in areas such as Bond development, new product development and automation. Special efforts would I be accorded to encash on the new and emerging opportunities through New Products and Applications. It will continue to expand its business in New * Markets by offering Existing range of products and applications through I marketing initiatives. Based on the Mega trends, in the past few years, your I company has been strengthening its presence by developing new products for I industry segments such as Infrastructure, Construction, Aerospace, Defense, Railways and Health care to ensure future growth and would continue its efforts in this direction to explore new opportunities in other emerging industries. All these pursuits and efforts by your company in the direction would be supplemented by participation in major national and international exhibitions, trade shows, and presence in leading industry forums, e-commerce initiatives. Your Company harnessing requisite technology on CRM and knowledge management and other value added services would enable to address the surfacing Mega trends. On the export front, your company will continue to enhance its global presence in identified countries through strategic alliances and tie-ups, exclusive Industry wise Management Representatives and continue to take advantage of the CUMI network in certain geographies enhancing global market presence.

The acquisition of Winterthur Technology Group (WTG) by the US multinational 3M Corporation and resultant indirect acquisition of 40% equity shareholding in your Company continues to be a matter of contention while not being an issue. The matter continues to be under the purview of The Honorable Company Law Board (CLB), Chennai and your company expects the ownership matter to be resolved soon.

, SUBSIDIARY COMPANIES

Wendt Grinding Technologies Limited, Thailand

Wendt Grinding Technologies Limited, Thailand, your company's 100% owned subsidiary has once again delivered superior performance. During the year, it has achieved a top line of Thai Baht 858Lacs (Rs.1620 Lacs) 19% growth over last year. The Profit Before Tax was Thai Baht 139 Lacs (Rs.274 Lacs) 5% higher and the Profit After Tax has been Thai Baht 112 Lacs (Rs.222 Lacs) 8% higher than last year. This better performance has been achieved despite continued slowdown, political issues and upheaval in the region.

Delivering consistent results year-on-year has been the hallmark for your subsidiary company and its steadfastness to repeat the same in the coming year as well. New customer additions, enhancing product basket and exploring new business opportunities have made up for the drop that arose as a result of decline in automobile production, lower export as well as shifting of some of the Japanese businesses out of Thailand.

During the year, your subsidiary company continued its focus on participation in many Industrial and Trade Exhibitions for networking and promotions besides organizing plant visits for some of the key customers. These efforts are expected to yield long term benefits for your subsidiary.

Wendt Middle East FZE, Sharjah

The second wholly owned subsidiary of your Company, Wendt Middle East FZE, Sharjah has churned out another superior performance for the year under review. During the year, it has achieved an annual sale of AED 38 lacs (Rs.627 Lacs) a commendable growth of 51% over the previous year. The Profits have been AED 8 Lacs (Rs.139 Lacs) which is 28% higher when compared to previous year.

As you may be aware, the manufacturing scenario in the entire region including , the neighbouring countries has been severely impacted on account of continued socio-economic instability and mired by political issues resulting in contraction of average capacity utilization to around 50% level with hardly any sizeable new investments announcement by the Government and Foreign players. The UAE region being a primarily an economy driven by Oil, Construction and Tourism, continuous fluctuation in these sectors has resulted in sharp rise in inflation.

Despite these challenges and continued slowdown and adversaries, your subsidiary has put its best efforts and focused on many initiatives like addition of new markets and customers, better service levels addition to enhancing product basket in the region to churn out a better than expected results.

APPROPRIATIONS

Available for appropriation (Rs in Lacs)

Profit After Tax 1485

Add: Balance brought forward from previous year 3233

Tota 4718

Less : Depreciation on transition to Schedule II of Companies 126

Act 2013 on tangible fixed assets with nil remaining useful life 4592

Recommended appropriations

Transfer to General Reserve 400

Dividend

-Interim Rs 10/-per share 200

-Final (Proposed dividend Rs 15/- per share of face value of Rs 10/- each) 300

Dividend Tax

-Interim 40

-Final (Proposed) 60

Balance carried forward 3592

"Total 4592

CORPORATE SOCIAL RESPONSIBILITY

Your Company firmly believes that an organization's true worth lies beyond its business and is best reflected by the service it renders to the community and the society. For your company, Corporate Social responsibility has always been based on the core values and transparency in all its business dealings and as such the contributions your company makes for economic development which is not limited to the workforce and their families alone but extends to the local communities, schools and society at large.

Your Company makes regular contributions to various social causes like education of underprivileged school children, old age homes, orphanages and basic sanitation and toilet facility. In addition, your company lays special emphasis on tree plantation and green environment not only within its premises but also the surrounding communities by distributing free saplings.

Your Company has been successfully running the Government Approved Skill Development Centre for last four years now with sole objective of providing formal vocational training in five industrial trades for uplifting the lives of young children drawn from poor, underprivileged and back-ward classes of the society. This initiative not only serves continuance of formal educations for these children but also helps them to seek gainful employment in various industries in future. With the enactment of the CSR provisions in the Companies Act 2013, the Company has put in place a CSR policy incorporating the requirements therein which is also available on the Company's website at the following link.

http://www.wendtindia.com/pdf/csrpolicy.pdf

As per the provisions of the Companies Act, 2013, the Company is required to spend Rs 38.49 Lacs out of which the Company has already spent Rs 36.33 Lacs towards CSR activities during the year 2014-15.

The Annual Report on CSR activities in the prescribed format is annexed herewith as ANNEXURE II.

DIVIDEND

Your Directors are pleased a recommend a Final Dividend of Rs 1 5/- per equity share of face value Rs 10/- each (1 50%) for the year ended 31 st March 201 5. This is in addition to the Interim Dividend of Rs 10/- per equity share of face value of Rs 10/- each, which was paid on 23rd February 2015.

The Final Dividend, subject to approval of members at the 33rd Annual General Meeting will be paid to those shareholders whose names appear on the register of members of the company as on 23rd July'2015. If approved, the total Dividend for the financial year, including the interim dividend, amounts to Rs 25/- per equity share and will absorb Rs . 600 lacs including dividend distribution tax of Rs 100 Lacs.

The Dividend will be tax-free in the hands of the shareholders

TRANSFER TO RESERVES

Your Company proposes to transfer Rs. 400 lacs to the General Reserve. An amount of Rs. 3592 Lacs is proposed to be retained in the Statement of Profit & Loss.

FIXED DEPOSITS

Your Company has not accepted any fixed deposits during the year 2014-15 and as such, there are no outstanding fixed deposits from the public as on 31st March 2015.

INVESTMENTS

Details of investments covered under section 186 of the Companies Act 2013 are given in the notes no 13 to the financial statements.

TRANSFER TO THE INVESTOR EDUCATION & PROTECTION FUND

Pursuant to the provision of Section 124 of the Companies Act, 2013, your Company has transferred an amount of Rs. 2.45 lacs being unclaimed dividend during theyeartothe Investor Education and Protection Fund (IEPF) established j by the Central Government.

CONSOLIDATED FINANCIAL RESULTS

The Consolidated Financial Statements (incorporating the operations of the Company and its two wholly owned overseas subsidiaries), in terms of Clause 32 of the Listing Agreement and prepared in accordance with Accounting Standard 21 as specified in Companies (Accounting Standards) Rules, 2006 & also as per Sec 129 of the Companies Act'2013 , form part of this Annual Report. A statement of summarized financials of all subsidiaries of your company including capital, reserves, total assets, total liabilities, details of investment, turnover etc pursuant to General Circular issued by MCA forms part of this report. The audited annual accounts and related information of the subsidiaries is available in our website- www.wendtindia.com.

The key financial data for the consolidated operations are as given below:-

KEY CONSOLIDATED FINANCIAL SUMMARY (Rs in Lacs)

31st March 2015 31st March 2014

Sales 12,274 10,890

Other Income 324 304

Profit Before Tax 1,686 1,675

Profit After Tax 1,354 1,166

Earnings per share-Rs. 67.70 58.30

QUALITY

High level of precision, accuracy and engineering are the most critical aspects for your company's products which in turn calls for meeting the exacting quality standards demanded by the customers across the range of industry segments. The Super Abrasives product range for your company comprises of Diamond & CBN grinding wheels and Tools in various bonding systems. The Machine Tools & Precision Components vertical include a range of precision machines, often customized, like Rotary Surface Grinding, Notch Milling, TC Ring Grinding, Honing Machines and accessories complying with the international standards and CE certifications in terms of their safety and operations.

Precision Components which is again falling under Non Super abrasives require very high level of precision as well as tolerance limits requiring strict adherence to quality standards and process controls and measurements. In order to ensure these requirements, your company has put in place all the Management standards such as ISO 9001, ISO 14001, TS 16949, OHSAS and SA8000. In addition, in order to fulfill the safety features and requirements of overseas customers, your company has successfully implemented and obtained the coveted EN 13236 Standards during the year.

For your company, superior product Quality and consistent performance have been the main differentiators. Towards this, your company ensures that deployment of quality management standards, process robustness and practicing the standards and norms at every stage of flow isstrictly adheredtobyall.

In order to avoid overlapping and process duplication in line with the international best practices, your company has implemented Integrated Management System (IMS). As you may be aware, your company constantly endeavors to build quality and consistency in every aspect of its business. As a result, it continues to accord high importance on training its employees on emerging technologies, makes investments on equipment and high-end machines besides application softwares such as CAD/CAM, ERP, Inspection Tools, Automation and Applications.

SAFETY, HEALTH AND ENVIRONMENT (SHE)

Your Company is ever committed towards Safety and Health of its workforce and also places equal importance on Environment management not just within the company premises but its neighborhood as well. In order to ensure this, the senior management of the company keeps vigil on maintaining high safety standards, health and environment protection by fully complying and deploying appropriate processes and underlying guidelines as per OHSAS 18001 and ISO 14001 EMS standards.

Your Company always considers its employees as the most valuable assets for the company and that the safety and health of each employee is of utmost importance and is not just a mundane necessity to ensure quality in every aspect of the business. In order to ensure this, your company continues to take various initiatives and programs such as annual health check-up plan, eye camp, physiotherapy, fitness center, blood donation camps etc., so that the employees and their families maintain good health and overall wellness. In addition, Your company continuously provides awareness training programmes and makes efforts to encourage the workforce to actively participate in relevant training programmes, workshops to perform their activities in a safe manner.

Your Company continues its commitment towards sound health and workplace safety of its employees. And for this, the company ensures following and practicing safety standards and practices by all by keeping the work places free of accidents, injuries, incidents and occupational related hazards.

You will be pleased to know that your company has again recorded Zero accident with no loss of man days in its operations during the year. Adherence to Safety, Health and Environmental practices are also ensured for its guests and visitors.

RECOGNITIONS AND AWARDS

During the year under review, Your Company received many awards and felicitations conferred by respectable organizations and apex bodies for superior achievements in different areas. These recognitions and accolades enhance the enthusiasm and optimism of the employees and is a morale booster for the Company as a whole.

Your company has received the following major awards during the year.

Quality Circle Awards Your Company's employees continued to exhibit their skills in various Quality Circle competitions as below

National Level organized by NCQC

Par Excellence" Award for Kaizen- 2 teams

Par Excellence" Award for SGA-1 team

Regional Level organized by CCQC

Golden Award" - SGA & Kaizen :3 teams

Silver Award"- Kaizen: 1 team

Environment, Health & Safety (EHS) Award

Your Company has received the "4 Star" Award from CII, Southern Region in recognition of its "Excellent

Commitment in Environment Health and Safety". Also received "Sectorial Award" under manufacturing sector and "Excellence Award" in Medium Scale category.

- Preferred Supplier Certificate

Your Company has received the "Preferred Supplier Certificate" from Bosch Group. With this recognition, your company now becomes one among three preferred suppliers in India and among twenty one worldwide. This prestigious certification enables the company to become a supplier to the Bosch Group globally for supply of precision components.

- Green Manufacturing Award

Your Company has received "Silver Medal" for Green Manufacturing from International Research Institute for Manufacturing, India (IRIM) for Environmental Care and Eco friendliness. This prestigious award focuses on assessment of four critical aspects of the organization such as Human element, Quality of input materials Operational efficiencies and Environmental friendly products

- Cufest 2014 Awards

Your Company's employees participated in Group-level Quality competitions "Cufest 2014" (Quality Festival of CUMI), and won awards for 5S, Poster, Idea King and Quality Quiz events during the year.

GOVERNANCE BOARD OF DIRECTORS

Mr. K Srinivasan, Director retires by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment. The necessary Resolution is being placed before the shareholders for approval. The Board of Directors of your company is of the opinion that his continued association with the Board will be beneficial to the company and recommends his re-election.

All the Directors of the company have confirmed that they are not disqualified from being appointed as directors in terms of Section 164 of the Companies Act, 2013. All the independent Directors have given a declaration under section 149(6) of the Companies Act 2013, confirming their independence.

MEETINGS

A calendar of Meetings is prepared and circulated in advance to the Directors.

During the year, five Board Meetings and four Audit Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

BOARD EVALUATION

Pursuant to the provision of the Companies Act, 2013 and Clause 49 of the Listing Agreement, 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, Stakeholder Relationship, CSR and Nomination & Remuneration Committees. The manner in which evaluation has been carried out has been explained in the Corporate Governance Report.

REMUNERATION POLICY

The Board has framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration policy is stated in the Corporate Governance Report.

AUDITORS AND AUDITORS' REPORT

The statutory auditors of the Company, M/s Deloitte Haskins & Sells, Chartered Accountants, (FR No.008072S) Bangalore were appointed as auditors at the 32nd Annual General Meeting to hold office upto the conclusion of the 34th Annual General Meeting, subject to the ratification of the appointment by members every year. The auditors of your Company have submitted a certificate of their eligibility for reappointment under Section 139 of the Companies Act, 2013 and being eligible have expressed their willingness to continue as the auditors of the Company. Consequently, ratification of their appointment is recommended to the shareholders. As per the relevant provisions of Listing Agreement, your company has ensured that the auditors are subject to the peer review process of the Institute of Chartered Accountants of India (ICAI) and hold a valid certificate issued by the Peer review Board of the ICAI. The statutory auditors have confirmed their compliance with the relevant provisions.

The notes on accounts referred to in the Auditors' Report are self explanatory and do not call for any further comments.

SECRETARIAL AUDIT

During the year your company has appointed M/s Apeksha Nagori, practicing Company Secretary to conduct

secretarial audit under section 204 of the Companies Act 2013, for the financial year 2014-15. The secretarial auditor has submitted the Report confirming compliance with the applicable provisions of the Companies Act 2013 and other rules and regulations issued by SEBI/other regulatory authorities. The Secretarial Audit Report forms part of the Annual Report.

The explanation to the observations of the Secretarial Audit Report by the Secretarial Auditor has been furnished in the respective sections of the Corporate Governance Report.

KEY MANAGERIAL PERSONNEL

Mr. Rajesh Khanna, Chief Executive, Mr. Mukesh Kumar Hamirwasia, Chief Financial Officer and Ms. Akanksha Bijawat, Company Secretary are the Key Managerial Personnel of the Company as per section 203 of the Companies Act 2013.

CORPORATE GOVERNANCE

Your Company continues to maintain high standards of Corporate Governance in all its interactions with various stakeholders. The company strives to be a sustainable and trusted organization as sustained governance is the cornerstone in building and maintaining relationship with all its stakeholders. It has inculcated into its system the strong culture of values, ethics and integrity living with the Five Lights - The spirit of the Murugappa Group. The company's relationship with its investors is an important component of Corporate Governance. It rigorously pursues a policy of 100% compliance with all statutory requirements and has a robust review system in place. The Board fully supports and endorses Corporate Governance practices in accordance with provisions of Clause 49 of the Listing Agreement. The Report on Corporate Governance alongwith the Auditors' Certificate regarding compliance of the conditions of Corporate Governance pursuant to Clause 49 of the Listing Agreement is annexed hereto and forms part of the Annual Report. Further, as required under Clause 49(IX) of the Listing Agreement a certificate from the Chief Executive and the Chief Financial Officer of your Company is being annexed with this Report.

VIGIL MECHANISM UNDER WHISTLE BLOWER POLICY

The Company has a vigil mechanism under Whistleblower Policy to provide necessary safeguards for protection of Directors, employees from reprisals or victimization. The details of the policy is explained in the Corporate Governance Report and also posted on the website of the Company.

Extract of Annual Return

The extract of the Annual Return in form MGT 9 is annexed to and forms part of this report. (FORMAT IN ANNEXURE I)

RATIO OF REMUNERATION TO EACH DIRECTOR:

Details / Disclosures of Ratio of Remuneration to each Director to the median employee's remuneration as ANNEXURE - III

Directors Responsibility Statement

In accordance with the provisions of Section 134(3)© of the Companies Act, 2013 and on the basis of the information furnished to them by the statutory auditors and the management, your Directors confirm that:

- In the preparation of the annual accounts for the financial year ended 31st March 2015 and the Balance Sheet as at that date ("Financial Statements"), the applicable accounting standards have been followed and no material departures have been made from the same.

- The Directors have selected appropriate 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 as at the end of accounting year and of the profit of the Company for the year ended 31st March'2015.

- The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for

preventing and detecting fraud and other irregularities.

- The Directors have prepared the annual accounts on a going concern basis.

- The Directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

- The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Disclosure of Statutory Particulars

- The particulars as prescribed under Section 134(3)(m) of the Companies Act,2013, read with Rules 8(3) of The Companies (Accounts) Rules 2014 are set out in Annexure A which forms part of this report.

- The information required under Section 197(12) of The Companies Act'2013 read with Rules 5(2) & (3) of The Companies (Appointment & Remuneration of Managerial Personnel) Rules 2014 and forming part of Directors report for the year ended 31st March'2015 is annexed in Annexure B.

ACKNOWLEDGEMENTS

Your Directors place on record their sincere gratitude to the continuing patronage and trust of our valued customers, bankers, investors, suppliers, business associates, shareholders, auditors and other statutory authorities who have extended their precious continued support and encouragement to your company. Your Directors sincerely appreciate the high degree of professionalism, commitment and dedication displayed by employees at all levels of the company and look forward to their continued involvement and support.

Finally, the Directors also wish to place on record their gratitude to the members of the Company for their Continued Support & Confidence.

By order of the Board For Wendt (India) Limited

Place: Chennai M M Murugappan Date: 21st April 2015 Chairman

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Mar 31, 2014

The Directors are pleased to present the 32nd Annual Report together with the Audited Financial Statements for the year ended 31st March 2014. The Management Discussion & Analysis Report has been included in the Directors Report so as to avoid duplication and repetition.

ECONOMIC OVERVIEW

The slowdown in the Indian economy continued for the year 2013-14, resulting in another tough year with sluggish growth affecting domestic demand, high energy prices, weakening of the Indian Rupee, higher raw material costs, repeated increases in the interest rates and lower investments than expected. Fall in savings without corresponding reduction in aggregate investments in critical areas led to widening of current account deficit. Higher inflation rates particularly in food grains and essential items, have all added up to the successive deceleration. One of the main reasons of stalling growth has been the vicious cycle of regulatory delays, judicial intervention, risk aversion by financial institutions and corporations in high value projects. With the loss of optimism in manufacturing sector, most companies have resorted to either deferment or significant reduction in their capital expenditures. The moderation effect by the manufacturing sector has taken a toll on the overall growth in addition to having a commensurate impact on the services sector during the year which contributes to 60% of the GDP and the resultant overall contraction over previous year.

This has been reflected as a common factor of weakness and negative sentiment across automotive and auto component industry as also infrastructure due to lack of new project approvals by the lenders. The average capacity utilization by the manufacturing sector continued to be around 60-70% level specifically for Automotive, Engineering and Cutting Tool industry sectors resulting from overall lower demand.

Despite deceleration in the domestic market and paltry recovery in some of the developed nations, India''s export has shown a gradual pick up partly contributed by rupee depreciation and improving demand in USA and European markets. While industry segments such as Automobile, Auto Components, Steel, Cutting Tools, Machine Tools & ceramics are the worst affected due to heightened industrial slowdown, segments like Refractory, Engineering and Glass have demonstrated marginally better results compared to the previous year. While the continued slowdown and weak global scenario has had its impact on the Indian economy, in the domestic arena, it has spread to all the sectors resulting in a modest GDP (Gross Domestic Product) growth.

The Industrial Production numbers have continued to be below normal on account of poor performance of core sectors having recorded a meagre 1 % growth which is around the same level of last year. The fall in output in manufacturing numbers has been mainly driven by lower inflow of orders, sharp fall in investments by capital goods sector, engineering, consumer goods and allied industry segments. However, in last few months, there has been some positive improvement in business sentiment, improved confidence and expectation of a recovery in growth and decline in inflation expectation, mainly on account of intervention by RBI to check capital outflow and upcoming general elections.

COMPANY PERFORMANCE OVERVIEW

(Rs in Lacs)

31st March 2014 31st March 2013

Sales 9,449 8,895

Other Income 611 225

Profit Before Tax 1,640 1,528

Provision for Tax 350 435

Provision for Deferred Tax 103 81

Profit After Tax 1,187 1,012

Earnings per Share - Rs 59.34 50.59

RESULTS OF OPERATIONS

Despite the continued slowdown and subdued market situation, your Company has put in its best efforts to achieve a top line of Rs.9449 Lacs during the year which is 6% higher compared to the previous year. While few industry segments like Refractory, Engineering and Glass have positively contributed in the domestic market, business from other segments such as Automobile, Auto component, Cutting Tools, Steel and Ceramics had adverse impact on your company''s sales resulting in 1% lower than last year. On the other hand, the Export business despite continued volatility and slow recovery, has achieved a growth of 36% as compared to the previous year.

Your Company continues to pursue business by focusing on three clearly defined verticals such as Super abrasives, Non-Super abrasives and International Business. Your company having taken cognizance of the current slowdown as one that is temporary and believing firmly in long-term growth of the company, it continues to make suitable investments and deploy the required resources in identified areas to ensure that the long term growth of your Company is sustained.

Super abrasive Business consisting of Diamond / CBN Grinding Wheels & Tools, Precision Dressing Rolls, Hones, Segmented Products & Stationary Dressers, achieved a growth of 7% over the previous year surpassing the industry average growth. This has been possible primarily due to constant efforts by your Company on new developments in product and applications. During the year, your Company successfully introduced some of new products including Resin Bond Wheels for Rotary Tools, Vitrified CBN Wheels for Auto and Auto Component, Precision Electroplated products for Engineering, Gear and Ceramics, Brazed Diamond Products for Textile and Precision Dressing Rolls for Bearing and certain auto component applications.

During the year, Your Company has augmented the Research and Development Centre and pursued indigenous development of some of the Bonds/Matrix in an effort to gain self-sufficiency in this area following the discontinuance of technical collaboration with its parent company Wendt GmbH. As you may be aware, your Company has gained competency in developing new applications / products for various industries over the years and the R & D Centre now complements these efforts well in all future endeavors for the Company. The recognition of the R & D Centre by the Department of Science and Industrial Research (DSIR), also provides an opportunity for your company to engage in jointly carrying out research & development work with other leading research organizations and laboratories on new technology frontiers.

The Non-Superabrasive Business comprising of machines and precision components achieved a moderate growth of 4% over the previous year. Despite an extremely difficult year characterized by deferment/freeze on capex, few project orders from the customers, the performance has been a decent one. During the year, your Company has developed many new models/variants of machines and successfully executed orders on CNC Rotary Surface Grinding Machines. The Company also successfully launched TC Ring Grinding Machine for mini steel plants which has

received encouraging responses from some of the potential users. Your Company during the year has also started development of few new models of Honing Machines with vertical spindle, one of them is scheduled for launch in few months from now. These new models are expected to address to a wider range of industry applications thereby de-risking from dependence purely on automotive segment while also increasing the customer base and help in enhancing the product basket for your Company.

On the precision components area, during the year, your Company has fully completed the development of two new applications and started the commercial production in small quantities. By leveraging its knowledge and competencies in Machines and related Superabrasive Tools, your Company has also started commercial production of precision ground and honed components for one of the customers. At the same time, the Company is in the process of exploring few other opportunities in this area which would not only strengthen the precision component business but also become a new engine for future growth.

FOCUS ON CUSTOMER CENTRICITY

In order to enhance the reach and build better relationship with the customers, your Company has undertaken

implementation of Customer Relationship Management (CRM) in association with SAP which is progressing well. This comprehensive approach towards customer will help the company with seamless integration of every aspect of marketing and sales process that directly connects the customer both in domestic and export market. Besides enhancing business relationship, it would create new opportunities for long term value creation for both customers and the company based on win-win situation.

Some of the major benefits your Company expects to derive from CRM are:

- Global reach through offering value proposition and effectively addressing customer needs

- Knowledge and solution base platform through integration with company''s Knowledge Management Hub thus helping the team with quick responses to customers with accuracy and minimum effort

- Better, faster and precise customer service and gaining competitive edge over its peers l 360 degree view of customers and insightful analytics

FOCUS ON PROCESS EFFICIENCY

During the year, your Company has embarked on Lean Management System in order to enhance process efficiency. Identification and elimination of bottlenecks, smooth integration of key areas in quality, planning, scheduling, production and operations is envisaged. Optimal utilization of various workstations, equipment and machines through effective planning and proper scheduling of material movement will streamline the process flows and significantly improve efficiency. Thus the implementation of lean management by your Company would ensure elimination of non-value added activities in the process flow touching overall effective utilization of the resources through use of scientific methods and tools. With this initiative, your Company is expected to reap long term benefits in terms of process reliability, better deliveries and higher customer satisfaction. Some of the major benefits your Company expects are l Reduction in lead time for product delivery

- Reduction in rejection levels

- Better control on Work in Progress and Raw Material Planning

- Reduction in outsourcing cost

- Improved employee productivity

- Cost effective products to customers

FUTURE PROSPECTS

Your Company has aligned the Business processes with the Strategies and Objectives and constantly strives to achieve superior performances year on year by focusing on products and process Innovation on a sustainable basis. To do this, deployment of appropriate technologies and processes are paramount in areas such as indigenous Bond development, process

automation and effective utilization of machines and equipment. Your Company makes special effort to capitalize on the emerging opportunities in growing industrial segments through New Products for New Markets. Your Company continuously explores opportunities for its existing range of products for the New Industry segments.

Accordingly, the company continues to strengthen its presence in Construction, Infrastructure, Aerospace, Ceramics, Defense and Railways to ensure future growth. While doing so, its key account management and increase of share of business with large customers for existing products would be pursued as a part of Market Penetration. These pursuits would be well supported by active participation in major national and international trade shows, exhibitions, providing customer education and value added services. Riding on the good export performance for the year, presence in export market and enhancing the global foot print would be focused by the company.

The acquisition of Winterthur Technology Group (WTG) by the US multinational 3M Corporation and resultant indirect acquisition of 40% equity share holding in your Company continues to be a matter of contention while not being an issue. The matter still continues to be under the purview of The Honorable Company Law Board (CLB), Chennai and your Company expects the ownership matter to be resolved soon.

SUBSIDIARY COMPANIES

Wendt Grinding Technologies Limited, Thailand

Your Company''s 100% owned subsidiary in Thailand has yet again achieved a laudable performance amid economic downturn, heavy floods and socio-economic issues and all time low industrial activities. During the year, your Company''s subsidiary achieved a top line sales of Thai Baht 723.54 Lacs (Rs.1398 Lacs), a 15% growth over last year. The Profit Before Tax was Thai Baht 142.15 Lacs (Rs.261 Lacs) and Profit After Tax was Thai Baht 113.32 Lacs (Rs.206 Lacs), lower by 13% over last year.

The increase in topline has been possible as a result of addition of products to the existing basket as well as new markets and customers during the year.

While many of the customers utilized their capacities around 65% levels for most part of the year, your subsidiary kept its vigil and focus on exploring new business opportunities with industries like Glass, Automobile, Steel, Auto parts, Ceramics, Cement and Engineering which well compensated for the drop. Last year, your subsidiary added Ceramic products mainly for Cement industry to its portfolio as a part of product offering to address the gap from one of the group companies and has seen initial successes and encouraging responses from the customers.

The subsidiary company continued its active participation in major Industrial and Trade Exhibitions with a clear focus on brand building, networking and seizing new business opportunities. It also organized many technical seminars at customer places, organized plant tours for its key customers to showcase its capability which are expected to benefit the subsidiary in the near future.

Wendt Middle East FZE, Sharjah

The second subsidiary of your Company in Sharjah, Wendt Middle East FZE, had turned profitable in FY 12-13 after initial years of hiccups and has done even better in the FY 13-14 despite odds and market volatility. During the year, it has achieved an annual sale of AED 25.22 Lacs (Rs.416 Lacs) a growth of 27% over the previous year. You would note that earlier year it had undertaken a major restructuring and cost control initiative which have tremendously helped the subsidiary to end the year with a PBT of AED 6.61 Lacs (Rs.109.13 Lacs), a growth of 78% over the last year.

As you may be aware, the manufacturing scenarios in the entire region including the neighboring countries has been severely affected on account of continued socio-economic instability and mired by political issues resulting in contraction of average capacity utilization to below 50% level with hardly any sizable new investments announcement by the Government and Foreign player. The UAE region being primarily an economy driven by Oil, Construction and Tourism, continuous fluctuation in these sectors has resulted in sharp rise of inflation.

Amid these challenges posed by all round slowdown and adversaries, your subsidiary has strived to focus on new initiatives like increased product range, new markets and improved service levels in the region to churn out a better than expected performance during the year.

APPROPRIATIONS

Available for appropriation (Rs in Lacs)

Profit After Tax 1187

Add: Balance brought forward from previous year 2746

Total 3933

Recommended appropriations

Transfer to General Reserve 119

Dividend

-Interim Rs 10/-per share 200

-Final (Proposed dividend Rs 15/- per share of face value of Rs 10/- each) 300

Dividend Tax

-Interim 32

-Final (Proposed) 49

Balance carried forward 3233

Total 3933

CORPORATE SOCIAL RESPONSIBILITY

Your Company sincerely acknowledges the role and responsibility of a good corporate and its Corporate Social responsibility pursuits have always been based on the foundation of ethics and utmost transparency in all its business dealings and as such the contributions your company makes for economic development which are not limited to the workforce alone and their families but extends to the local communities, schools and society at large.

Thus, befitting the company''s size & operations, your Company makes contributions for various social causes like child education, old age, orphanages, healthcare, employability and environment preservation. It also places emphasis on tree plantation and afforestation not only in the premises but also adjoining areas by distributing free saplings.

The Skill Development Centre established two years back within the premises by joining hands with its parent company CUMI, has been progressing well with addition of new batch of students. As you may be aware, the objective of this initiative is to provide vocational training - a platform for continuance of formal education, employability opportunities and create highly skilled & productive workforce for the company and outside industry in future. By doing this, your Company not only ensures livelihood and gainful employment it also makes a conscious effort to bring transformation and uplift the lives of young children drawn from poor, underprivileged and back-ward classes of the society.

DIVIDEND

Your Directors are pleased to recommend a Final Dividend of Rs 15/- per equity share of face value Rs 10/- each (150%) for the year ended 31st March''2014. This is in addition to the Interim Dividend of Rs 10/- per equity share of face value of Rs 10/- each paid on 15th February 2014.

The Final Dividend, subject to approval of members at the 32nd Annual General Meeting will be paid to those shareholders whose names appear on the register of members of the company as on 24th July, 2014. If approved, the total Dividend for the financial year, including the interim dividend, amounts to Rs 25/- per equity share and will absorb Rs.581 Lacs including dividend distribution tax of Rs 81 Lacs.

The Dividend will be tax-free in the hands of the shareholders.

TRANSFER TO RESERVES

Your Company proposes to transfer Rs. 119 Lacs to the General Reserve. An amount of Rs. 3233 Lacs is proposed to be retained in the Statement of Profit & Loss.

CONSOLIDATED FINANCIAL RESULTS

As per General Circular No. 2/2011 dated 8th February 2011 issued by The Ministry of Corporate Affairs (MCA), Government of India, a general exemption was provided to Companies for attaching the Directors Report, balance sheet, profit and loss account of all subsidiary companies to its Annual Report, subject to fulfilling certain conditions as stipulated in the circular. Your Company complies with those conditions and therefore the financial statements of the subsidiaries are not attached in its Annual Report. The audited annual accounts and related information of the subsidiaries is available in our website- www.wendtindia.com.

The Consolidated Financial Statements (incorporating the operations of the Company and its two subsidiaries), in terms of Clause 32 of the Listing Agreement and prepared in accordance with Accounting Standard 21 as specified in Companies (Accounting Standards) Rules, 2006 also form part of this Annual Report. A statement of summarized financials of all subsidiaries of your company including capital, reserves, total assets, total liabilities, details of investment, turnover etc pursuant to General Circular issued by MCA forms part of this report. The key financial data for the consolidated operations are as given below:-

KEY CONSOLIDATED FINANCIAL SUMMARY

(Rs in Lacs)

31st March 2014 31st March 2013

Sales 10,890

10,059

Other Income 304 236

Profit Before Tax 1,675 1,874

Profit After Tax 1,166 1,286

Earnings per share-Rs. 58.30 64.30

QUALITY

Your Company manufactures products that embed a high level of precision and accuracy as demanded by the customers and various industry segments. While the Super Abrasives Product range consists of Diamond & CBN Grinding Wheels and Special Tools, the Non Super Abrasives includes customized range of high precision machines such as CNC Grinding, Notch Milling, TC Ring Grinding, Honing and Accessories which fulfil the international standards and CE certifications. Precision Components which is part of Non Super Abrasives require significant degree of precision and very close tolerances necessitating them to passing through the stringent quality standards and measurements through the production process. With all the Quality Management standards such as ISO 9001, ISO 14001, TS 16949, OHSAS & SA8000 in place, during the year your Company has initiated the work for obtaining Certification for EN 13236 Product Safety Standards to address product safety requirements of overseas markets.

As you may be aware, Quality being the keystone as well as a major differentiator for your Company since inception, it strives hard to ensure that final product quality is built by deployment and embracing effective quality management, process robustness, quality assurance and discipline at every stage of material flow.

Your Company has ensured that international standards and systems like Integrated Management System (IMS) focusing on quality management and environment management and TS 16949 for manufacturing precision components are deployed and followed in strict adherence throughout. It has been a constant endeavor for your Company to drive quality deeper in every aspect and in order to ensure this, your Company continues to place higher emphasis on training in latest trends besides investment in high-end equipment, machineries & application software and modern tools.

SAFETY, HEALTH AND ENVIRONMENT (SHE)

Your Company continues to place high emphasis on aspects such as Safety, Health of not only its workforce but also equal importance on Environment management of your company which is conducive and efficient too. Towards this, the top management stays ever committed for maintaining high standards for safety, health and environment management by being fully compliant to applicable statutory requirements as per OHSAS 18001 and ISO 14001 EMS standards and guidelines.

Recognizing that the employees are the most valuable assets of your Company and that the safety and health of each employee is of utmost importance, their safety and health does not become just a mundane necessity but is at par with Quality and Manufacturing by your Company. In order to ensure this, your Company continues to take initiatives and various programs such as annual health check-up plan, eye camp, physiotherapy, fitness center, blood donation camps etc., so that the employees and their families maintain good health and overall wellness.

Health and Safety being considered as one of the important performance measurements by your Company, it continuously provides awareness

training programmes and makes efforts to encourage the workforce to actively participate in relevant training programmes, workshops to perform their activities in a safe manner.

Your Company has always been committed to meet high level of health, safety and wellness standards by ensuring adherence to safety standards and practices so as to keep the work areas free of accidents, injuries, incidents and occupational related hazards for all.

You will be pleased to know that your Company has again recorded Zero accident with no loss of man days in its operations during the year. Apart from the employees, adherence to Safety, Health and Environmental practices are also ensured for its guests and visitors.

RECOGNITIONS AND AWARDS

Your Company continues to maintain its record of winning Awards, Recognitions and Accolades by demonstrating its achievements, performances and practices in various platforms at National and International levels as well. These recognitions and honors raise the motivation levels and morale of the employees and the Company as a whole. During the year your Company has received the following major awards.

- Meritorious Award for Best Presented Accounts from South Asian Federation of Accountants (SAFA).

Your Company has received the Certificate of Merit Award for Best Presented Accounts from SAFA for the year 2011-12 under Manufacturing Sector Category.

This coveted award conferred by South Asian Federation of Accountants, is an acknowledgment of the accounting practices, policies and transparency adopted by your Company which are not only amongst the best in India, but in the South Asian countries as well. The Best Presented Annual Report Award of SAFA is considered to be the most prestigious accolade for financial reporting in the region and represents SAFAs recognitions for organizations which have achieved excellence in presentation and disclosure of high quality, relevant, realistic and objectively comparable financial statements, being in line with the International Accounting Financial Reporting standards.

- Quality Circle Awards

Your Company''s employees continued to exhibit their skills in Quality Circle competitions and two teams were recognized with Excellence Awards at international level convention in the International Convention of Quality Circle, Taiwan held in Taipei during the year.

National Level organized by NCQC

- "Excellence" Award for Kaizen

- "Excellence" Award for SGA Regional Level organized by CCQC

- "Golden Award" - SGA & Kaizen:2 teams

- "Golden Award"- Kaizen: 2 teams

- Environment, Health & Safety (EHS) Award

Your Company has received the 4 Star category Award from CII, Southern Region in recognition of its "Excellent Commitment in Environment Health and Safety" in manufacturing industry category for environment, health and safety standards at the workplace.

- 5S Model Company Award

Your Company has been conferred with the Successive Model Company Award for 5S by the ABK-AOTS, a Japanese international body reputed for acknowledging innovative 5S practices and setting standards around the world.

- Cufest 2013 Awards

Your Company''s employees participated in Group-level Quality competitions Cufest 2013 (Quality Festival of CUMI), and won awards for Best Practices, 5S, Poster, Idea King, Quality Quiz events during the year.

Directors

The Directors, Mr. Shrinivas G Shirgurkar and Mr. K S Shetty, retire by rotation at the forthcoming Annual General Meeting and being eligible, offer themselves for re-appointment. The necessary Resolution is being placed before the shareholders for approval. The Board of Directors of your Company is of the opinion that their continued association with the Board will be beneficial to the company and recommend their re-election.

All the Directors of the company have confirmed that they are not then disqualified from being appointed as Directors in terms of Section 274 (1)(g)of the Companies Act, 1956.

Auditors and Auditors'' Report

The statutory auditors of the Company, M/s Deloitte Haskins & Sells, Chartered Accountants, retire at the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. The retiring auditors of your Company have submitted a certificate of their eligibility for reappointment under Section 224 (1B) of the Companies Act, 1956 and indicated their willingness to continue. Your Directors recommend their reappointment as Statutory Auditors for the coming year. As per the relevant provisions of Listing Agreement, your Company has ensured that the auditors are subject to the peer review process of the Institute of Chartered Accountants of India (ICAI) and hold a valid certificate issued by the Peer Review Board of the ICAI. The statutory auditors have confirmed their compliance with the relevant provisions.

The notes on accounts referred to in the Auditors'' Report are self explanatory and do not call for any further comments.

COST AUDITOR

In compliance with the Central Government''s order F.No.52/26/CAB-2010 dated 6th November 2012, your Board has appointed M/s M.R. Rajshekhar & Co, Cost Accountant to carry out the audit of cost records of the company for the financial year 2013-14 . The Cost Audit Report will be filed with the Central Government within 6 months from the end of the Financial Year ended 31st March, 2014.

Fixed Deposits

Your Company has not accepted any fixed deposits during the year 2013-14 and as such, there are no outstanding fixed deposits from the public as on 31st March 2014.

CORPORATE GOVERNANCE

Your Company strives to maintain high standards of Corporate Governance in all its interactions with various stakeholders. The company continues its endeavor to be a sustainable and trusted organization as sustained governance is the cornerstone in building and maintaining relationship with all its stakeholders. It has embedded into its system the strong culture of values, ethics and integrity living with the Five Lights - The Spirit of The Murugappa Group. It rigorously pursues a policy of 100% compliance with all statutory requirements and has a robust review system in place. The Board fully supports and endorses Corporate Governance practices in accordance with provisions of Clause 49 of the Listing Agreement. The Report on Corporate Governance along with the Auditors'' Certificate regarding compliance of the conditions of Corporate Governance pursuant to Clause 49 of the Listing Agreement is annexed hereto and forms part of the Annual Report. Further, as required under Clause 49(V) of the Listing Agreement a certificate from the Chief Executive and the Chief Financial Officer of your Company is being annexed with this Report.

TRANSFER TO THE INVESTOR EDUCATION & PROTECTION FUND

Pursuant to the provision of Section 205A(5) of the Companies Act, 1956, your Company has transferred an amount of Rs. 2.36 lacs being unclaimed dividend during the year to the Investor Education and Protection Fund (IEPF) established by the Central Government.

Directors Responsibility Statement

In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956 and on the basis of the information furnished to them by the statutory auditors and the management, your Directors confirm that:

- In the preparation of the annual accounts for the financial year ended 31st March 2014 and the Balance Sheet as at that date ("Financial Statements"), the applicable accounting standards have been followed and no material departures have been made from the same.

- The Directors have selected appropriate 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 as at the end of accounting year and of the profit of the Company for the year ended 31st March, 2014.

- The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

- The Directors have prepared the annual accounts on a going concern basis.

- Proper systems were in place to ensure compliance of all applicable laws to the company.

Disclosure of Statutory Particulars

- The particulars as prescribed under subsection (1) (e) of Section 217 of the Companies Act ,1956, read with the Companies (Disclosure of Particulars in the report of Board of Directors) Rules ,1988 are set out in Annexure A which forms part of this report.

- The information required under Section 217 (2A) of The Companies Act''1956 read with Companies (Particulars

of Employees) Rules,1975, and forming part of Directors report for the year ended 31st March, 2014 is annexed in Annexure B.

ACKNOWLEDGEMENTS

Your Directors sincerely appreciate the high degree of professionalism, commitment and dedication displayed by employees at all levels of the company.

The Directors sincerely convey their appreciation to investors, bankers, customers, suppliers, auditors, company''s associates and subsidiaries for their continued support during the year. Your Directors extend their sincere gratitude to all the regulatory agencies like SEBI, Stock Exchanges, Registrar of Companies and other Central and State Government authorities/ agencies, Stakeholders, Suppliers, Vendors and Sub contracting partners, Business associates for their continued support.

Finally, the Directors also wish to place on record their gratitude to the members of the Company for their continued Support & Confidence.

By order of the Board

For Wendt (India) Limited

Place: Chennai M M Murugappan

Date : 19th April 2014 Chairman

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Mar 31, 2013

The Directors are pleased to present the 31st Annual Report together with the Audited Financial Statements for the year ended 31st March 2013. The Management Discussion & Analysis Report has been included in the Directors Report so as to avoid duplication and repetition.

ECONOMIC OVERVIEW

The year 2012-13 has been one of the most difficult years with the Indian economy slowing down significantly on account of lowered domestic demand, declining exports, continued high energy prices alongside successive weakening of the Indian Rupee and stalling investments. High inflation rates and spiraling prices of raw materials continued with no respite thereby adding to the deceleration. Execution of high value projects such as Mining, Steel, Coal, Power continued to be mired by regulatory and environmental issues affecting .''the growth and investments by the downstream projects. Even the bellwether service sector of the Indian economy could clock the lowest-ever growth of just 6% over the last year. The average capacity utilization by the manufacturing sector remained subdued between 60-75% level specifically for Automotive, Engineering and Cutting Tool industries sectors resulting in lowering of the capex plans. The other contributory factors include continued sovereign debt crisis in Euro Zone, successive recessionary trend in

-3r Japan and political instability in major oil producing countries fueling rise in oil prices have had their & adverse impact on the overall growth of the economy.

The export demand was also hard hit due to continued global slowdown except some of the South East Asian countries such as Thailand, Malaysia, and Indonesia. While industry segments such as Automobile, Auto Components, Cutting Tools, Machine Tools & Refractory are the worst affected due to the deepening of industrial slowdown, segments like Steel, Ceramics, Glass and Defence have demonstrated marginally better results on a comparable basis. While the slow and subdued global scenario has had its share in the growth of Indian economy, in the domestic front it has cut across all the sectors resulting in lowest GDP (Gross Domestic Product) growth in the last decade.

The Industrial Production numbers remained weak on account of poor performance of the manufacturing and mining sectors which recorded a meager 1% growth compared to 3.7% of previous year. The decline in manufacturing numbers has mainly been driven by contraction of orders and investments by capital goods, engineering, consumer goods and allied industry segments. However, the Government with its recent announcement of reforms and policy change measures has demonstrated some encouragement & rekindled the business confidence on recovery.

COMPANY PERFORMANCE OVERVIEW

(Rs in Lacs) 31st March 2013 31st March 2012

Sales 8895 10001

Other Income 225 278

Profit Before Tax 528 2552

Provision for Tax 435 759

Provision for Deferred Tax 81 64

Profit After Tax 1012 1729

Earnings per Share- Rs 50.59 86.45

RESULTS OF OPERATIONS

Despite the industry slowdown and sluggish market condition, your Company has put in its best efforts to achieve a Top line of Rs.8895 Lacs during the year which is 11 % lower than the previous year. The major contributory industry segments in the domestic business which had their adverse impact on your company''s sales of 11 % lower than last year are Automobile, Auto component, Cutting Tools, Steel, Refractory and Ceramics. The Export business was also affected by continued volatility and global slowdown with achieving a total sale of 12% lower compared to the previous year.

Your Company continued its efforts on pursuing business in three verticals namely Superabrasives, Non- Superabrasives and International Business. The current slowdown being considered temporary and in keeping with your Company''s long-term growth, would continue to commit the required investments and resources in identified growth areas.

Superabrasive Business consisting of Diamond/CBN Grinding Wheels & Tools, Precision Dressing Rolls, Hones, Segmented Products & Stationary Dressers achieved a performance level of 91% over the last year which is better than the industry average. This has been possible due to continued focus by your Company on the development of new products and new applications. During the year, your Company successfully introduced some new products including Resin Bond Wheels for Steel and Cutting Tools, Hones for Auto Component, Vitrified CBN Wheels for Paper & Textile and Auto Component, Precision Electroplated CBN Wheels for Engineering, Brazed Diamond Products for Ceramic & Glass and Precision Dressing Rolls for Aerospace and Gear Manufacturing.

During the year, the technical collaboration with its parent company Wendt GmbH got discontinued. Your Company, over the years has gained competency to have its own fully equipped Research & Development Center. You will be happy to know that your Company''s R&D Center has obtained Department of Science & Industrial Research (DSIR) recognition, Government of India. This recognition and approval would not only help your Company to carry out research & development work for itself but also provide ample opportunity to jointly work with some of the leading research institutes and laboratories on cutting-edge technologies in future.

Non-Superabrasive Business which comprises of machine tools and precision components could achieve a performance of 83% of the previous year. This lower performance is on account of capex freeze and postponement

of investment decisions by many of the targeted customers. However, during the period, your Company has developed many new models/variants of machines and successfully executed some of the new machines like CNCTC Roll Grinding Machine, CNC Surface Grinding Machine with reciprocating table and Honing Machine. Introduced three years back to the basket, the Delapena range of Honing Machines has been well accepted in the market. Recognizing the need for catering to a wider range of honing applications, your Company has started work on development of 4 new models of Wendt -Delapena Honing Machines.

On the precision components front, during the year, your Company has successfully completed the development of two variants of components for new applications. This is expected to enhance the precision component basket and de-risk from dependency on single customer. In addition, your Company continued to embark on its new initiative of producing Precision Ground and Honed Components by leveraging its competencies in Machines and related Superabrasive Tools. Process establishment, trials and component prove-out have been done. On commercial production, your Company''s position would get further strengthened in Precision Component Business while also being a new growth engine.

t FOCUS ON CUSTOMER CENTRICITY

In order to enhance the Company''s market reach and better visibility for both fm Super abrasives and Machines in the domestic market, your Company launched the I unique nationwide initiative Wendt-On-Wheels (WOW) during the year. Through this r initiative, your Company could make the customers abreast of the latest products and new launches besides demonstrating your Company''s capabilities in the field of Precision Grinding and Honing by going to the Cities and Doorsteps of the customers. In its first six ¦r months of journey covering the Western, Northern and parts of Central India, the Company - received many appreciations besides generating business opportunities. Having had a good ^T response, this initiative would now be extended to Eastern, South Central and Southern regions - of the domestic market. Your Company is confident of generating new business opportunities while developing better understanding of the customers'' exacting needs and requirements. - Your Company would be implementing Customer Relationship Management (CRM) and is working with ^^ SAP for effective implementation. With a comprehensive approach towards customer, this will enable seamless integration of every aspect of process that touches the customer - marketing, sales, customer service and field support by connecting people, process, knowledge and technology. This initiative is aimed at enhancing business relationship, creating new opportunities for engagement and generating long term value for both customer and the company based on mutual trust, openness and win-win situation. With this Wendt would be the first tooling company globally which would link the Knowledge Portal and provide real-time technological solutions in Grinding and Honing to its customers while also helping to take commercial decisions promptly.

Some of the major benefits your Company sees from the CRM Application are:

- Extend reach to customers worldwide through offering value proposition and effectively addressing their needs.

- Act as platform of Solution Knowledge Base by interfacing with Company''s Knowledge Management Portal and helping the team to respond to customers with accuracy and minimum effort

- Better and faster customer service

- Enable the Company to gain competitive edge over its peers

- Provide 360 degree view of customer, insightful analytics and reports

FUTURE PROSPECTS

With the business processes aligned with the Strategies and Objectives, your Company strives in its endeavors by focusing on product and process Innovation for delivering superior performances and sustainable growth. Adoption and deployment of appropriate technologies for indigenous Bond development, streamlining processes and introduction of automation in critical areas is the key for the future growth for your Company. The Company thrives to seize new business opportunities in new growing industrial segments which it addresses through New Products for New Markets. Secondly, it continuously explores for the existing range of products that can find applications in the New Industries and Markets. Accordingly the Company would continue to aggressively pursue business in Construction, Infrastructure, Aerospace, Ceramics, Defense, Railways and Health Care to ensure future growth in both Indian and Global scenario. Thirdly, under key account management, the existing range of products would be aggressively promoted with the existing identified key customers as a part of Market Penetration. Complementing these pursuits would be through active participation in major national and international trade shows, exhibitions, providing customer education and value added services.

The acquisition of Winterthur Technology Group (WTG) by the US Multinational 3M Corporation and resultant indirect acquisition of 40% equity share holding in your Company has been a matter of contention. The impending matter continues to be under the purview of The Honorable Company Law Board (CLB), Chennai and your Company expects the ownership matter to be resolved soon.

SUBSIDIARY COMPANIES

Wendt Grinding Technologies Limited, Thailand

Your Company''s wholly owned Subsidiary in Thailand demonstrated yet another year of commendable performance despite the turbulent economic situation and subdued industrial activities, During the year, your Company''s Subsidiary achieved a top line sales of Thai Baht63 Million (Rs.1108 Lacs), 8% growth over last year. The Profit Before Tax was Thai Baht 17.3 Million (Rs.292Lacs) and Profit After Tax was Thai Baht 13 Million (Rs.219Lacs), a growth of 23% over last year.

The improved profit level was possible as a result of various cost reduction initiatives, operational efficiency measures, enhanced product basket as well as market expansion undertaken by the Subsidiary Company during the year.

Your Company''s Subsidiary maintained leadership position in re-profiling business in Thailand and achieved highest ever re-profiles for auto industry since inception. While many of the customers in the existing industries operated between 50-60% capacity level during the year, focused approach by your Company''s Subsidiary on exploring new business opportunities with industries like Glass, Automobile, Steel, Auto parts, Wood, Furniture and Construction industry, well compensated for the drop. During the year, your Company''s Subsidiary added Industrial Ceramic Products into its basket for catering to Power and Cement Industries in Thailand. Initial responses from customers have been encouraging forthese products.

Your Company''s Subsidiary continued to participate in major Industrial Trade Exhibitions with clear focus on brand building and increasing the market reach. It also conducted Technical Seminars, Sales Meets and organized Plant Tours for its key customers to showcase its capability. Addition of new products to its existing basket helped in generating new opportunities forthe Subsidiary.

Wendt Middle East FZE, Sharjah

Your Company''s second wholly owned Subsidiary in Sharjah, Wendt Middle East FZE, has demonstrated a turnaround despite all odds. It has achieved an annual sale of AED 19.81 Lacs (Rs.293Lacs). During the year, it has undertaken major restructuring and cost control measures which helped the Subsidiary to end the year with PBT of AED 3.72 Lacs (Rs.62 Lacs) against a loss of AED 2.41 Lacs (Rs.27 Lacs) in previous year. As a part of restructuring, the Subsidiary has continued its operations by keeping the employee strength lean and efficient with greater emphasis on multi- tasking apart from maintaining strict control on fixed costs.

During the year, the manufacturing sector in the entire region has been severely impacted due to continued socio-

economic and political instability resulting in average capacity utilization of less than 50% with no new investments in sight. Moreover, UAE being a trading economy primarily driven by Oil and Construction, continued fluctuation in the oil prices has resulted in higher inflation compared to previous year.

Ff Despite the many challenges posed by the slowdown, the Subsidiary has worked on many new initiatives such as increased product range, addressing new markets and better service levels in the region. With the renewed focus the Subsidiary is expected to perform even better in coming years.

* APPROPRIATIONS

Available for appropriation (Rs in Lacs)

Profit After Tax 1012

Add: Balance brought forward from previous year 2184

Total 3196

Recommended appropriations

Transfer to General Reserve 101

Proposed dividend Rs 15/- per share of face value of Rs 10/- each (150%) 300

Dividend Tax 49

Balance carried forward 2746

Total 3196



CORPORATE SOCIAL RESPONSIBILITY

As a responsible Corporate, your Company''s Corporate Social Responsibility pursuits have always been based on the foundation of ethical behavior in all its business transactions and contributions for economic development of not only the workforce and their families but also extending to the local communities and society at large.

Your Company, befitting its size & operations, makes contributions to various social causes such as education, healthcare, employability and environment preservation. It also places emphasis on tree plantation and forestation not only in the premises but also adjoining areas by distributing free saplings.

During the year, your Company has established the Skill Development Centre - CUMI CENTRE FOR SKILL DEVELOPMENT (CCSD) by joining hands with its parent company CUMI housed within the factory premises. The objective of this initiative is to provide vocational education, training, employability and create highly skilled & productive workforce for the Company and outside industry in future. Through this, the Company not only ensures livelihood and gainful employment but makes a conscious effort to bring transformation and uplift the lives of young children drawn from poor, underprivileged and back-ward classes of the society. In addition to a monthly stipend, all other expenses such as accommodation, food, books & writing materials etc are provided free of cost to each student during the training period. Apart from this, your Company uses every opportunity to make contributions to the Old Age Homes and to the Weaker Sections of the Society.

During the year, your Company has also got SA8000 certification accredited by the TUV. This is towards social accountability which lays high emphasis on work culture, healthy practices and protection of interests of work force at large.

DIVIDEND

Despite having a tough year impacting the profits and the need to conserve cash for capital expenditure, which as a philosophy has been addressed through it''s internal accruals, the Board of Directors have recommended a dividend of Rs 15/- per equity share of face value of Rs. 10/- each (150%). The Dividend on approval at the 31 st Annual General Meeting will be paid to those shareholders whose names appear on the Register of Members of the Company as on 25th July, 2013.

The Dividend will be tax-free in the hands of the shareholders.

TRANSFERTO RESERVES

Your Company proposes to transfer Rs 101 lacs to the General Reserve. An amount of Rs 2746 lacs is proposed to be retained in the Statement of Profit & Loss.

CONSOLIDATED FINANCIAL RESULTS

The Ministry of Corporate Affairs (MCA) vide its circular no. 2/2011 dated 8th February 2011 has granted general exemption to holding companies from complying with the provisions of Section 212 (8) of the Companies Act, 1956 with regard to attaching the Balance Sheet, Profit and Loss Account and other documents of its Subsidiary

Companies provided such companies publish the Audited Consolidated Financial Statements in their Annual Report. Accordingly, the Annual Report 2012-13 of your Company does not contain the standalone financial statements of the Subsidiaries. The audited annual accounts and related information of the Subsidiaries is available in our website- www, wendtindia.com.

The Consolidated Financial Statements (incorporating the operations of the Company and its two Subsidiaries), in terms of Clause 32 of the Listing Agreement and prepared in accordance with Accounting Standard 21 as specified in Companies (Accounting Standards) Rules, 2006 also form part of this Annual Report. The key financial data for the consolidated operations are as given below:-

KEY CONSOLIDATED FINANCIAL SUMMARY

(Rs in Lacs)

31st March 2013 31st March 2012

Sales 10059 11056

Other Income 236 246

Profit Before Tax 1874 2849

Profit After Tax 1286 1946

Earnings per share-Rs 64.30 97.29

QUALITY

IIf The products manufactured by your Company have high level of precision and accuracies meeting exacting customer requirements. In, the product range includes Diamond & CBN Grinding Wheels and Special Tools. In Non-Superabrasives, it includes customized CNC W Grinding, Notch Milling, Honing Machines and Accessories meeting the international standards and CE certifications. Precision Components which form a

Fpart of Non Superabrasives require considerable degree of precision and higher tolerances thus requiring to go through stringent quality checks at every stage.

Company, Quality being the cornerstone as well as a differentiator, it ensures that through effective quality management, adequate process controls and quality assurance at each stage of operation.

Your Company has ensured that international standards and practices are adopted like Integrated Management System (IMS) focusing on Quality Management and Environment Management and TS 16949 for manufacturing precision components. As a part of driving the quality culture deeper into the organization, your Company continues to prioritize the needs for training on latest trends besides investment in standard equipment, machineries & application software.

SAFETY, HEALTH AND ENVIRONMENT (SHE)

Your Company accords top priority for Safety, Health and Environment Management System and ensures that it is efficient and effective. The top management is committed to maintaining highest standards of safety, health and environment fully complying with the applicable statutory requirements as per OHSAS 18001 and ISO 14001 EMS standards.

Your Company considers its employees as the most valuable assets and that the safety and health of each employee is of utmost importance. Employee safety and health is not just another aspect rather a necessity for your Company and treated at par with Quality and Manufacturing.

Against this backdrop, your Company is committed to meet highest level of health, safety and wellness standards by ensuring adherence to safety norms and a work environment free of accidents, incidents, injuries and occupational illness.

Health and Safety being the key performance measurements of your Company, it continuously promotes awareness programs and provides relevant training, workshops to all employees to perform their activities in a safe manner.

During the year, your Company again recorded Zero Accident and had no loss of man days in its operations. Apart from the employees, adherence of Safety, Health and Environmental Practices are also ensured for its guests and visitors.

Through various programs such as Annual Health Check-up Plan, Eye Camp, Physiotherapy, Fitness Center, Blood Donation Camps etc, your Company makes all efforts for its employees and their families to maintain sound health.

RECOGNITIONS AND AWARDS

Your Company continues to maintain its wining streak of Awards, Recognitions and bring Accolades by showcasing its performance, achievements and practices at various platforms. These recognitions and honours raise the morale and motivation levels of employees and the Company as a whole. During the year your Company has received the following major awards

- Engineering Export Promotion Council (EEPC) Award

Your Company has for the ninth consecutive year received the "Silver Shield for Star Performer" under Large Enterprise categoryfor export of Miscellaneous Engineering Goods from Engineering Export Promotion Council (EEPC), India.

- ICAI Award for Excellence in Financial Reporting

Your Company has been conferred with Plaque for Excellence in Financial Reporting by ICAI for the year 2011 - 12 under Manufacturing Sector Category for turnover less than Rs. 500 crores. This is the second consecutive year that your Company has got this recognition for Excellence in Financial Reporting,

Conferred by the apex body, The Institute of Chartered Accountants of India (ICAI), this coveted acknowledgment signifies thatthe accounting practices & policies followed byyourCompanyareamongstthe best in the industry. It also takes into cognizance the review of accounting practices adopted in the preparation of financial statements and the policies for disclosure and presentation of both financial and non-financial information in the Annual Report in

terms of philosophy of transparent disclosures, integrity and reliability.

- Significant Achievement in the Cll -EXIM Bank Award for Business Excellence

Second year in the row, your Company achieved another milestone this year by receiving the Commendation Certificate for Significant Achievement in the Cll-Exim Bank Award for Business Excellence. For Wendt (India) Ltd., it is a journey in pursuit of Business Excellence and this higher level award as compared to earlier year is a testimony of the continuous improvement in the journey towards Business Excellence.

- ECGC-D&B Award

Your Company was adjudged as the winner of "ECGC-D&B Award for Best Risk Management Practices" for 2011 -12 for exports from Export Credit Guarantee Corporation- Dun & Bradstreet.

- Quality Circle Awards

Your Company''s employees continued to exhibit their skills in Quality Circle Competitions and three of the teams were recognized with Par Excellence/ Excellence Awards. The teams had won these awards at the national level have been selected for participation at the International Level Competition to be held in Taiwan at the International Convention for Quality Circle.

National Level organized by NCQC at Kanpur

- "Par Excellence" Award for Kaizen & SGA (Small Group Activity)

- "Excellence" Award for SGA

Regional Level organized by QCFI at Bangalore

- Golden Award for Small Group Activity (SGA) and Kaizen

Cufest 2012 Awards

rYour Company''s employees participated in Group-level Quality Competitions "Cufest 2012" (Quality Festival of C U MI), and won awards for Innovation, Best Practice, 5S, Poster, Idea King & Quality Quiz events.

FINANCIAL REVIEW

Earnings

Revenues

During the year, your Company achieved total sales of Rs.8895 Lacs as compared to 2011-12 which was Rs.10001 Lacs. While the domestic sales declined by 11%, the export sales recorded a drop of 12% compared to the previous year. As briefed, this lower performance is due to depressed market conditions and continued economic recession which prevailed during the year.

Profit before Tax

Accordingly, the profit before tax is lower by 40% at Rs.1528 Lacs compared to Rs.2552 Lacs in 2011 -12.

Profit after Tax

The profit aftertax is lower by 41 %, at Rs. 1012 Lacs, compared to Rs.1729 Lacs in year 2011 -12.

Investments

Your Company''s investments as on 31-03-2013 grew from Rs.1370 Lacs to Rs.1496 Lacs. The Investment comprises of trade investment in the two wholly owned Subsidiaries viz. Wendt Grinding Technologies Ltd, Thailand & Wendt Middle East FZE, Sharjah and the balance is in Debt Schemes. The mutual funds investment portfolio increased from Rs.1016 Lacs to Rs.1142 Lacs, a growth of 12% during the year due to prudent investment policies followed by your Company.

Your Company follows the Group norms by investing the surplus generated by the business in liquid debt funds which yield sizeable returns. This ensures safety and liquidity of Company''s funds along with reasonable yield as per the prevailing market rates.

The investment in mutual funds ensures meeting the internal fund requirements for capital expenditure purpose, as your Company does not have any borrowing.

Costs

The Fixed Costs have grown by 2% compared to last year. However, due to lower topline, the Fixed Cost as percentage of sales is higher at 32%. Due to higher capital expenditure incurred during the earlier years,

depreciation has grown by 20%. However, your Company believes that this addition to fixed assets will generate additional revenue in future years. Affected by frequent power cuts, the utilities cost has gone up by 26% due to DG Set running for longer periods. Travel, transport expenses has gone up by 40% due to higher travel necessitated by the Wendt-on - Wheel (WOW) initiative.

The variable costs have increased during the year due to increase in the raw material cost and bond prices which has put pressure on the margins of the Company. Your Company has initiated price correction from both customers and key suppliers during the current year to improve its bottom line which is expected to yield results in the coming year.

Financial Position Shareholders Funds

The Shareholders Fund as on 31.03.2013 was Rs.7625 Lacs against Rs.6962 Lacs of previous year, an increase of 10%. Accordingly, the book value of the share stands at Rs.381/- as compared to Rs.348/- during the previous year, an increase of 9%.

Loan Funds

Your Company has a cash credit limit with State Bank of India to bridge the short term fund requirement and only to supplement the temporary mismatches in its cash flow. Your Company does not have any interest bearing term loan.

During current year also, the working capital limits of your Company have been rated by ICRA. ICRA has reaffirmed AA- (pronounced ICRA double A minus) rating assigned to the Rs.2.0 crore Long Term Fund facilities of your Company which signifies low credit risk and stable. The Short Term (Non Fund based) Rating has been reaffirmed as A1 (pronounced ICRA A one plus). Overall your Company''s rating continues to be stable and low credit risk.

ASSETS

FIXED ASSETS

Your Company has been prudent in it''s capex spend, during the current year in view of the continued economic slowdown. The capital expenditure during the year was contained to Rs.1087 Lacs. The major Capex Spend is on addition of New Plant & Machinery and other identified areas which are critical for the future growth of the Company.

Inventories and Sundry Debtors

The overall inventory levels as on 31st March, 2013 has been largely similar to last year at Rs.1385 Lacs. There was a reduction in the Raw Material Inventory by Rs.23 Lacs and Finished Goods Inventory by Rs.6Lacs. However, the Work- in - Progress machine inventory was higher by Rs.20 Lacs. This was due to delay in dispatch/clearance for some of the items from few customers.

The Sales have decreased by 11%; and hence the Receivables are lesser from Rs.2010 Lacs to Rs.1916 Lacs as on 31st March, 2013. The current slowdown has resulted in working capital pressure and delayed payments by the customers. Your Company adopted an aggressive Receivable Management System including close follow ups and credit control measures through the SAP System to ensure that receivables were kept under control and payments were received in time.

Foreign Exchange Hedging

Your Company continues to follow the policy of natural hedging of foreign exchange earnings and outflow and hence it does not take forward covers. The net forex gain during the year was Rs.39 Lacs.

Financial Performance with respect to Operational Performance

Your Company''s Operating Profit and Contribution has been better than the industry average on account of measures taken for improved operational efficiency and better product mix. This was aided by accurate information & customer data, newly implemented centralized drawing management system, better planning & scheduling through SAP ERP System and effective vendor management. Your Company also improved its response time & service levels and was able to supply the right product at the right time with right specifications there by providing value addition to the customer.

HUMAN RESOURCE

Nurturing and development of the Human Capital is accorded high importance by your Company. Accordingly, the HR policies and the practices of your Company are geared towards this objective. The processes for attracting, retaining and rewarding talent are well laid-down and your Company follows a transparent system to identify and reward performers.

Your Company''s Human Resource Policies are constantly reviewed and realigned based on people expectations, making it more employee-friendly thereby creating an engaged workforce which focuses on productivity. It is a constant endeavor for your Company to adopt the industry best practices and aligning them with the strategic directions, goals and objectives in terms of people processes.

In order to meet growth plans set by the Company and to fulfill the ever-changing needs and expectations of the customers, your Company continues to focus on competency building, skill enhancement and overall development so that its people are well prepared to take on the challenges.

Personnel development plans focus on how each individual''s strength can be best leveraged to deliver to his/her full potential. Your Company believes that this can be achieved through specialized training programmes and cross functional learning exposure. The Company gives very high importance to enhancing employees'' competency and skills through on the job training and external training programmes. Special attention is given to the health and safety of the employees. Training, welfare measures and individual development of employees continue to be high priority area for your Company. This in turn, translates into improved quality and operational efficiency.

Your Company lays special focus to Business Excellence and continual improvement journey (TQM) in its quest to improve the quality of its products, processes and systems. Continuous learning, job enrichment, high engagement levels, conducive work environment and a cordial industrial relationship has been the hallmark of your Company resulting in an attrition rate well below the industry average. Your Company strongly believes that higher Employee Engagement Level is prerequisite for Customer Delight.

Your Company continues to have a smooth and enabling work climate that promotes performance, customer focus and innovative thinking while adhering to the highest standards of quality, integrity and ethics. Your Company continues to enjoy the support of a committed, experienced and satisfied workforce. Compensation package offered by your Company is one of the best in industry.

The manpower strength of confirmed employees of your Company as on 31 st March, 2013 was 279. Employee relations have been smooth and cordial and the work atmosphere remained congenial during the year.

TUV''s accreditation to Wendt with SA8000 Certification is a testimony to the importance that your organization gives on health & safety, working hours, child labour as well as employee discrimination.

Directors

Mr. K Srinivasan, Director, retires by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment. The necessary Resolution is being placed before the shareholders for approval. The Board of Directors of your Company is of the opinion that his continued association with the Board will be beneficial to the Company and recommends his re-election.

All the Directors of the Company have confirmed that they are not disqualified from being appointed as directors in terms of Section 274 (1 )(g)of the Companies Act, 1956.

Auditors and Auditors'' Report

M/s Deloitte Haskins & Sells, Chartered Accountants, the Statutory Auditors of your Company are due for retirement at the ensuing Annual General Meeting and are eligible for re-appointment. Your Directors recommend their reappointment as Statutory Auditors for the coming year. The Statutory Auditors of your Company have submitted a certificate to the Company that if appointed as the Statutory Auditors for the coming year, such appointment shall be in accordance of the provisions of Section 224 (1B) of the Companies Act, 1956. Further, the Statutory Auditors have also submitted a certificate to the Company that they have subjected themselves for the peer review process of the Institute of Chartered Accountants of India.

The notes on accounts referred to in the Auditors'' Report are self explanatory and do not call for any further comments.

COST AUDITOR

In compliance with the Central Government''s order F.No.52/26/CAB-2010 dated 24th January 2012, your Board has appointed M/s M.R. Rajhshekar & Co, Cost Accountant to carry out the cost audit of two of the products of the company namely. Synthetic Coolants and Grinding Machines, Pump Vanes & Accessories for the financial year 2012-13 to which the Cost Audit Order applies. The Cost Audit Report will be filed with the Central Government as per timeline.

Fixed Deposits

Your Company has not accepted any fixed deposits during the year 2012-13 and as such, there are no outstanding fixed deposits from the public as on 31 st March, 2013.

CORPORATE GOVERNANCE

Your Company has inculcated strong culture of values, ethics and integrity living with the Five Lights - The Spirit of the Murugappa Group. The Company strives to be a sustainable and trusted organization as sustained governance is the cornerstone for building and maintaining relationships with its stakeholders. The Company''s relationship with its investors is an important component of Corporate Governance. It rigorously pursues a policy of 100% compliance with all statutory requirements and has a robust system to review them. The Board fully supports and endorses Corporate Governance Practices in accordance with provisions of Clause 49 of the Listing Agreement. The Report on Corporate Governance along with the Auditors'' Certificate regarding compliance of the conditions of Corporate Governance pursuant to Clause 49 of the Listing Agreement is annexed hereto and forms part of the Annual Report. Further, as required under Clause 49(V) of the Listing Agreement a certificate from the Chief Executive and the Chief Financial Officer of your Company is being annexed with this Report.

TRANSFER TO THE INVESTOR EDUCATIONS PROTECTION FUND

In terms of Section 205C of the Companies Act, 1956 an amount of Rs. 1.90 lacs being unclaimed dividend was transferred during the year to the Investor Education and Protection Fund established by the Central Government

Directors Responsibility Statement

In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956 and on the basis of the information furnished to them by the Statutory Auditors and the Management, your Directors confirm that:

- In the preparation of the annual accounts for the financial year ended 31st March, 2013, the applicable accounting standards have been followed and no material departures have been made from the same.

- 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 as at the end of accounting year and of the profit of the Company for the year ended 31st March,2013.

- The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

- The Directors have prepared the annual accounts on a going concern basis.

Disclosure of Statutory Particulars

Information required under Section 217 (1) (e) and Section 217 (2A) of the Companies Act 1956 are given in Annexu re A and Band forms part of this Report.

APPRECIATION

Your Directors take this opportunity to place on record their appreciation to all employees for their hard work, spirited efforts, dedication and loyalty to the Company.

The employees have worked based on principles of honesty, integrity and fair play and this has helped your Company to survive a very difficult year. The Directors also wish to place on record their appreciation to Investors, Bankers, Customers, Suppliers, Auditors, Company''s Associates and Subsidiaries for their continued support during the year. Your Directors extend their sincere gratitude to all the regulatory agencies like SEBI, Stock Exchanges, Registrar of Companies and other Central and State Government Authorities/ Agencies, Stakeholders, Suppliers, Vendors and Sub-contracting Partners, Business Associates for their support.

Finally, the Directors also wish to place on record their special appreciation to the valued Shareholders of the

Company for their Continued Confidences Support. ,

By order of the Board

For Wendt (India) Limited

Place: Chennai M M Murugappan

Date: 18th Aoril 2013 Chairman

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Mar 31, 2012

The Directors are pleased to present the 30th Annual Report together with the Audited Financial Statements for the year ended 31 st March 2012. The Management Discussion & Analysis Report, which is required to be furnished as per the requirement of Stock Exchanges, has been included in the Directors Report so as to avoid duplication and repetition.

ECONOMIC OVERVIEW

During the year, the Indian economy achieved a moderate growth reflecting a dampening of business sentiments, hit by headline inflation, high energy prices and a successive weakening of the Indian Rupee for most part of the year. High interest rates and spiraling prices of raw materials added to the woes. Regulatory issues with respect to environment clearances and land acquisitions slowing the pace of execution of high value projects and sector specific factors like coal and iron ore supply affecting the power, steel and related industries. While agriculture and services sector continued to perform well, this lower than expected growth can be attributed to weakening of industrial growth. The manufacturing sector grew by 2.7% and 0.4% during the second & third quarter respectively. Similarly, Index of Industrial Production (IIP) for first nine months recorded a growth of only 3.6% compared to 8.2% in the previous year. Other contributory factors include the fragile situation in Euro Zone and the spiraling oil prices have had adverse impact on the overall growth of the economy.

While all these factors had their influence on the tepid growth of the Indian economy, it still achieved a higher growth rate than many other emerging economies thereby providing ample evidence of financial prudence and resilience in the country's fiscal policy.

Contrary to the apprehensions, the export sector provided the silver lining by retaining its growth momentum. Industrial sectors like Automobile, Auto Components, Cutting Tools, General Engineering, Machine Tools, Ceramics, Glass and Defence demonstrated better results. While sectors like Aviation, Mining, Construction and Steel experienced lower than projected growth during the year. This anomaly contributed to India's modest GDP (Gross Domestic Product) rate.

With the IIP numbers showing an upward movement from the last quarter of the year, indicates a positive trend after a temporary slowdown. The Government is determined to continue with its fiscal measures to ensure a reversal of the economy to the growth trajectory. In fact, India has the advantage of a huge internal domestic market for goods and services which can generate demand and accelerate growth.

At the global level, we have seen steady flow of good news from the US with respect to improved employment and increased consumer spending. Japan and adjoining countries are likely to pull out of recession after being severely hit by earth quake and floods, post announcement of fiscal stimulus for reconstruction.

COMPANY PERFORMANCE OVERVIEW

( Rs in Lacs)

31st March 31st March 2012 2011

Sales 10001 8173

Other Income 278 299

Profit Before Tax 2552 2356

Provision for Tax 759 755

Provision for Deferred Tax 641 6

Profit After Tax 1729 1595

Earnings per Share-Rs. 86.45 79.76

RESULTS OF OPERATIONS

Despite a moderate economic growth, your Company during the year achieved a mile stone by crossing Top line of Rs 100 Crores translating into a growth of 22% over the previous year. Reflecting on better performance of many industrial segments which the company addresses, the domestic turnover recorded a growth of 20% over the previous year. The major contributory industry segments in the domestic business which helped your company's above growth are Automotive, Engineering, Cutting Tools and Steel. The Export sales achieved even better results by recording an impressive 35% growth during 2011-12- albeit the continued slow industrial recovery in many of the developed markets.

Your Company's continued efforts on aggressively growing the three business verticals namely Super Abrasives, Non-Super Abrasives and International Business has yielded encouraging results once again . In order that your company achieves accelerated growth year on year, it would continue to commit the required investments and resources.

Non-Superabrasive Business which comprises of machine tools and precision components registered a growth of 21%. During the year, your company has successfully built and executed some of the new machines like Notch Milling Machine with branding feature Wencut405, CNC TC Roll Grinding Machine WGM35S, CNC Surface Grinding Machine WHS310V with reciprocating table, Delapena Honing Machines and Profile Grinding & Dressing Machine with Video Vision WDM 15V.

Super Abrasive Business which comprises of Diamond/CBN grinding Wheels & Tools, precision Dressing Rolls, Hones, Segmented products & Stationary Dressers achieved a growth of 23% over the last year. This has been possible due to continued focus by your Company on the development of new products and new applications. Your Company successfully introduced many new products including Resin Bond Wheels for Rotary Tool reconditioning. Vitrified CBN Wheels for Paper & Textile and Auto Component, Precision Electroplated CBN Wheels for Engineering & Auto component applications. Brazed Diamond Products for Ceramic & Glass, Precision Dressing Rolls for Turbine and Aerospace and Vitrified Diamond Products for Lapidary industry.

In order to have better visibility and enhance the company's market reach for not only Super abrasives but also Machines in the domestic arena, your Company has launched a new nationwide initiative Wendt-On-Wheels (WOW). Through this unique initiative, your Company would make the customers abreast of the new launches, show case the latest cost competitive, value-added Products & Services in the field of Precision Grinding and Honing, by going to the Cities and Doorsteps of the customers. Your Company is confident that this initiative would open new avenues for better understanding of the customer's exacting needs and addressing the requirements.

Your Company plans to leverage its competencies in Machines and related Superabrasive Tools by embarking on precision ground and honed components. This move would further strengthen its position in the machines and precision component business besides serving as new growth engine for your Company. On the super abrasive side, its two new innovative projects namely Eco Resin Bond wheels and Vitrified Diamond Products initiated last year, are progressing well and in the final stage of validation &testing in the market.

During the year, your Company has successfully implemented OHSAS 18001 and SA8000 standards. You will be pleased to knowthat Wendt India is one of the few companies in the country to have implemented SA8000 standards which lays high emphasis on Corporate Social Responsibility and protects the interests of workforce at large.

With this, your company now has the following International Management Systems in place

- Integrated Management System (IMS)- integration of ISO 9001 for Quality Management System and ISO 14001 for Environment Management System

- ISO/TS 16949 for Manufacture of Precision Machined Components

- OHSAS 18001 focusing on Occupational Health and Safety

- SA8000 for Social Accountability focusing on health &social accountable work culture

FUTURE PROSPECTS

In line with the Mission, Vision, Strategies and Business Objectives, your Company's continued endeavor would be focusing on product and process Innovation for delivering superior performances and ensuring growth year on year. These efforts would be well supported through deployment of latest technologies and processes besides introduction of automation in critical areas. Your Company is constantly on the lookout for new opportunities in other growing industrial segments and exploring newer avenues in the existing industries it caters to. Your Company would intensively pursue business in Construction, Infrastructure, Defense, Aerospace, Ceramics, Railways and Health care for future growth. To augment this pursuit it will continue to participate in trade shows, exhibitions, customer education and other value added services.

The acquisition of Winterthur Technology Group (WTG) by the US multinational 3M Corporation and resultant indirect acquisition of 40% equity share holding in your Company has been a matter of contention. The impending matter continues to be under the purview of The Honorable Company Law Board (CLB), Chennai and your company expects the ownership matterto be resolved soon.

SUBSIDIARY COMPANIES Wendt Grinding Technologies Limited, Thailand

During the year, the devastating flood in Thailand and Tsunami coupled with political and economic turmoil severely impacted the business of your Company's wholly owned subsidiary situated there. Despite this, the subsidiary presented a commendable performance maintaining the top line at Thai Baht 65 Million (Rs.1028 Lacs). The Profit Before Tax was Thai Baht 17.1 Million (Rs.259Lacs) and Profit After Tax wasThai Baht 12 Million (Rs.178Lacs).

In order to improve its brand awareness and create increased recall, your Subsidiary Company participated in major Industrial Trade exhibitions with clear focus on brand building and increasing market reach. It also focused on industry specific product advertising, conducted technical seminars and organized sales meets.

Your Subsidiary maintained leadership position in re-profiling market segment in Thailand. However, completion of solar glass project running for 18 months coupled with floods resulted in significant drop in profiling business. To compensate the reduction in sales & profit, the subsidiary undertook a number of new initiatives aimed at expanding the product basket and ensuring profitable sustained operation. Your Subsidiary has put in place clear processes and business process improvement plans with strict cost controls. Your Subsidiary during the year enhanced understanding of market/region and focus on high contribution products.

Wendt Middle East FZE, Sharjah

Your Company's second wholly owned Subsidiary in Sharjah, Wendt Middle East FZE, achieved an annual sale of AED 2180 (000's) (Rs.283Lacs) during the year which is 1 50% higher over last year. This higher sales was despite continued economic slowdown and social unrest experienced in the region it operates. The volatility in the primary economic drivers such as Construction, Trading and Oil in the Middle East region was a dampener in our achieving the planned business. Even the re-profiling services did not gain momentum as anticipated due to slowdown which impacted the performance of the Subsidiary.

Your Subsidiary has embarked on new initiatives to consolidate and grow business. It expects to be profitable from the coming financial year.

APPROPRIATIONS

Available for appropriation (Rs in Lacs)

Profit after Tax 1729

Add: Balance brought forward from

previous year 1386

Total 3115

Recommended appropriations

Transfer to General Reserve 350

Proposed dividend Rs 25/- per share of

face value of Rs 10/- each (250 %) 500

Dividend tax 81

Balance carried forward 2184

Total 3115

CORPORATE SOCIAL RESPONSIBILITY

Corporate Social responsibility is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as that of local communities and society at large.

Befitting the size, your Company contributes to various social causes in the field of education, healthcare and environment preservation. Your Company places great emphasis on tree planting measures and afforestation not only in the premises but also adjoining localities. Besides, your Company has been contributing to the old age homes and to the weaker sections of the society. Your Company also celebrated the Environmental Day where employees were handed over tree saplings to plant trees in their locality.

DIVIDEND

Your Company has taken an aggressive plan for the next year including higher capital expenditure to fuel the required growth. This needs to be financed through its internal accruals and debt.

The Board of Directors have recommended a dividend of Rs.25/- per equity share of face value of Rs.10/- each (250%) and the same will be paid after the approval at the forthcoming Annual General Meeting. The dividend warrants will be posted after 20th July, 2012.

CONSOLIDATED FINANCIAL RESULTS

As per Section 212 of the Companies Act, 1956, it is required to attach the Directors' Report, Balance Sheet and Profit and Loss Account of the Subsidiaries to your Company's Annual Report. The Ministry of Corporate Affairs vide its circular No. 2/2011 dated 8th February 2011 has granted general exemption to companies from complying with the provisions of Section 212 (8) of the Companies Act, 1956 provided such companies publish the audited consolidated financial statements in the Annual Report. Accordingly, the Annual Report 2011-12 does not contain the financial statements of the Subsidiaries. The audited annual accounts and related information of the Subsidiaries is available in our website - www.wendtindia.com. The Ministry has further vide its letter dated 14th February 2011 informed the Company that approval of the Ministry is further not required.

The Consolidated Financial Statements (incorporating the operations of the Company and its two subsidiaries), in terms of Clause 32 of the Listing Agreement and prepared in accordance with Accounting Standard 21 as specified in Companies (Accounting Standards) Rules, 2006 also form part of this Annual Report. The key financial data for the consolidated operations are as given below:-

KEY CONSOLIDATED FINANCIAL SUMMARY

(Rs in Lacs)

31st March 31st March 2012 2011

Sales 11056 9129

Other Income 246 197

Profit Before Tax 2849 2551

Profit After Tax 1946 1684

Earnings per share-Rs 97.29 84.18

QUALITY

Your Company manufactures products that require high level of precision meeting exacting customer standards and tolerances. The product range includes Super Abrasive (Diamond /CBN) Grinding Wheels and Special Tools. Customized CNC Grinding / Honing Machines are manufactured to meet the international standards. Precision Components which require high degree of precision and tolerances go through stringent quality checks. Quality being one of the overriding attributes and differentiators, effective quality management, adequate process controls and quality assurance at each stage of operation are vital for final output to fulfill the customer requirement.

Recognizing this, your Company has put in place the required international standards such as Integrated Management System (IMS) focusing on quality management and environment management and TS 16949 for manufacturing precision machined components. As a part of driving the quality culture deeper into the organization, your Company continues to lay greater emphasis on training on latest trends. In order that the product quality meets the standards, your Company continues to earmark adequate investments on latest equipments, machineries etc.

SAFETY, HEALTH AND ENVIRONMENT (SHE)

The Safety, Health and Environment Management System of your Company is top driven, efficient, effective and vibrant. The top management of your Company is committed for maintaining highest standards of safety, health and environment protection and fulfills the applicable statutory requirements.

Your Company considers its employees as the most valuable assets. Your Company believes that the safety and health of its employees are of paramount importance. Apart from adherence to all safety norms to ensure that the environment is free of accidents.

incidents, injuries and occupational illness during the working hours and your Company is committed to meet high level of health, safety and wellness standards.

Health and Safety continues to be key performance indicators of Your Company and it firmly believes that safe and healthy conditions at the workplace are as necessary and as important as production and quality. Your Company provides the necessary information, promotes awareness and provides training to all employees to carry out their tasks in a safe manner.

Attesting these efforts, during the year, your Company has achieved the certification for the OHSAS 18001 focusing on Occupational Health & Safety of people

During the year, your Company again recorded Zero Accident and has not lost any man days of production. Apart from the employees, adherence of Safety, Health and Environmental practices are also ensured for its guests and visitors by maintaining the highest level of standards across the organization.

Regular training on Safety, Fire hazards mock drills are conducted to ensure safety all round the year. Specialized Standard Personnel Protection Equipments are being provided to the operating personnel for use in their respective work areas.

Employee health & physical fitness is a paramount consideration for your Company. Employees are required to undergo annual medical check-ups for timely diagnosis of their health condition. Your Company has a visiting doctor at the factory regularly to help the employees and their families to maintain sound health.

RECOGNITIONS AND AWARDS

Your Company continues to win Awards,

Recognitions and bring Accolades by showcasing its performance, achievements and practices at various platforms. These recognitions and honours raise the morale and motivation levels of employees and your Company as a whole for achieving higher results. During the year your Company has received the following major awards

- Engineering Export Promotion Council (EEPC) Award

Your Company has for the eighth consecutive year received the "Silver Shield for Star Performer" under Large Enterprise category for export of Miscellaneous Engineering Goods from Engineering Export Promotion Council (EEPC), India.

- ICAI Award for Excellence in Financial Reporting

Your Company has been conferred with Silver Shield for Excellence in Financial Reporting by

ICAI for the year 2010-11 under Manufacturing Sector Category for turnover less than Rs 500 crores.

Founded by the apex body. The Institute of Chartered Accountants of India (ICAI), this coveted acknowledgment signifies that the accounting policies followed by your Company are amongst the best in the industry. It also takes into consideration the review of accounting practices adopted in the preparation of financial statements and the policies for disclosure and presentation of financial statements and non- financial information in the Annual Report in terms of philosophy of transparent disclosures, integrity and reliability.

- Commendation Certificate for CM -EXIM Bank Award for Business Excellence

Your Company achieved another milestone by receiving the Commendation Certificate for Strong Commitment to Excel in the Cll-Exim Bank Award for Business Excellence. For Wendt India, it is a journey in pursuit of Business Excellence and this award is a testimony of its continuous journey towards Business Excellence.

- Quality Circle Awards

Your Company's employees exhibited their skills in Quality Circle competitions and were recognized at both national and regional level

National Level organized by NCQC at Hyderabad

- Distinguished Award for SGA

- Par Excellence Award for Kaizen.

Regional Level organized by QCFI at Bangalore

- Awards for Small Group Activities (SGA), Kaizen, Quality Quiz and 5S

- 5S Model Company Award from ABK-AOTS DOSOKAI

Your Company received special appreciation and highest level of recognition for practicing 5S and was conferred with 5S Model Company Award by ABK-AOTS. This recognizes the efforts your Company continues to take in Japanese Management Practices such as Total Employee Engagement, 5S, Kaizen, TPM etc for the past many years.

- Cufest 2011 Awards

Your Company's employees participated in Group- level Quality Competitions "Cufest 2011" (Quality Festival of CUMI), and won awards for Poster & Idea King & Quality Quiz events.

FINANCIAL REVIEW Earnings Revenues

During the year, the revenue recorded overall growth of 22% up from Rs.8173Lacs for the year 2010-11 to Rs.10001 Lacs. The domestic sales achieved a growth of 20 % while export sales recorded a growth of 35 % compared to the previous year.

Profit before Tax

The profit before tax is higher by 8%, up from Rs.2356 Lacs to Rs.2552 Lacs

Profit after Tax

The profit after tax is higher by 8%, up from Rs.1 595 Lacs to Rs.1729 Lacs

Investments

Your Company's investments as on 31-03-2012 have reduced from Rs.2257Lacs to Rs.1370Lacs. The Investment comprises of trade investment in the two wholly owned subsidiaries viz. Wendt Grinding Technologies Ltd, Thailand & Wendt Middle East FZE, Sharjah and the balance is in Debt schemes. During the year your Company has made a provision for diminution in the investment of Sharjah subsidiary of Rs.77 Lacs. The mutual funds investment portfolio declined from Rs.1827 Lacs to Rs1016 Lacs during the year due to higher capital expenditure spent by your Company.

Your Company follows the practice of investing surplus generated by the business in liquid debt funds which yield sizeable returns. This ensures safety and liquidity of Company's funds along with reasonable yield as per the prevailing market rates.

As we plough back the earnings, the capital expenditure need of your Company is met entirely from the mutual funds investments.

Costs

The Fixed costs have grown 34 % compared to last year. Due to higher capital expenditure during the year, depreciation has grown by 13%. Repairs and maintenance expenses (excluding building repairs) grew by 25 % on account of major repair & refurbishing work undertaken on machines for improving the process capability and required building maintenance. The sales expenses have grown by 46% on account of sales promotion activities and new initiatives such as Exhibitions, Seminar etc. The Salaries and wages including contract labour have grown by 37 % due to additional recruitment and conversion of casual workers to permanent labour and provisioning done as per the revised accounting standard AS 1 5.

The variable cost has come down due to better product mix and improved operational efficiency resulting into higher operating profit margin.

Financial Position Shareholders Funds

The shareholders fund as on 31.03.2012 was Rs.6962 Lacs against Rs.5814 Lacs of previous year, an increase of 20%. Accordingly, the book value of the share stands at Rs.348/- as compared to Rs.291/- during the previous year, an increase of 20%.

Loan Funds

Your Company continues to utilize its cash credit limit with State Bank of India to bridge the short term fund requirement and for meeting the temporary mismatches in its cash flow. Your Company does not have anyterm loan.

During current year also, the working capital limits of your Company have been rated by ICRA. ICRA has reaffirmed AA- (pronounced ICRA double A minus) rating assigned to the Rs 2.0 crore Long term Fund facilities of your Company which signifies low credit risk and stable. The short Term (Non Fund based) Rating has been reaffirmed as A1 (pronounced ICRA A one plus). Overall your Company's rating continues to be stable and low credit risk.

Assets Fixed assets

The capital expenditure during the year was Rs.1451 Lacs against Rs.628 Lacs spent in the previous year. The net fixed asset accordingly stood at Rs.4363 Lacs compared to Rs.3264 Lacs of previous year. The higher capex spent is on addition of new plant & machinery, expansion/modernization of the existing product lines and on research & development which is expected to yield results in coming years.

Inventories and Sundry Debtors

There has been an increase in overall inventory by Rs.349 Lacs compared to previous year, mainly due to increase in raw material inventory by Rs.160 Lacs and Work-in Progress machine inventory by 52Lacs. This was due to delay in despatch clearance from few customers. The raw material inventory level was strategically kept up for ensuring prompt delivery to the customers & addressing on-call supplies to key customers.

The sales have increased by 22%; and hence the Receivables have been up at Rs.514 Lacs. However, the average credit days have been maintained at last year level of 59 days. This was possible due to adoption of credit lock, more aggressive receivable management drive supported by SAP ERP system.

Foreign Exchange Hedging

Your Company follows the policy of natural hedging of foreign exchange earnings and outflow and hence it does not take forward covers. The net forex gain during the year was Rs.52 Lacs.

Financial Performance with respect to Operational Performance

Your Company's Operating profit and Contribution has recorded reasonable growth due to improved operational efficiency and better product mix. Thanks to the availability of reliable information and effective customer data. Knowledge Management such as drawings, specification, data sheet through the SAP ERP System, your Company improved its response time and service levels and was able to supply the right product at the right time with right specifications there by providing value addition to the customer.

HUMAN RESOURCE

Human Resource strategy of your Company revolves around managing talent, developing leadership and managerial competencies, managing employee performance and enhancing employee engagement. Your Company's philosophy has been to create an open and transparent culture, focused on people and their competencies for delivering superior performance. Welfare and training at all levels of our employees continue to be areas of major focus for the Company. Your Company is putting continuous efforts to employ and retain professionally qualified personnel. At present human capital at Wendt is 234 personnel who are committed towards the growth of your Company.

During the year an Employee Engagement and Satisfaction survey was conducted which revealed that there is a noticeable improvement in the satisfaction level compared to the earlier survey. Further, it has yielded many insights into our employees' expectations and has provided useful information for senior management to increase employee engagement.

During the year, we have established a fully integrated Employees Information Portal, "ESS", which acts as a multipurpose utility application for employees.

Your Company has a favourable work environment that motivates performance, customer focus and innovation while adhering to the highest standards of quality and integrity. Industrial relations were harmonious throughout the organization. Safety, welfare and training at all employee levels continues to be areas of major focus for your Company

Your Company enjoys the support of committed and well satisfied workforce. Compensation package offered by your Company is one of the best in industry. Your Company follows well-structured methods of recruitment, training, motivation and performance appraisal, attracting and retaining the best in talent. These practices enable your Company to keep the attrition rate below the industry average.

Directors

Mr. K S Shetty, Director retires by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment. The necessary Resolution is being placed before the shareholders for approval.

Auditors and Auditors' Report

M/s Deloitte Haskins & Sells, Chartered Accountants, the statutory auditors of your Company hold office, until the conclusion of the ensuing Annual General Meeting and being eligible, have offered themselves for reappointment, subject to the approval of the shareholders at the Annual General Meeting. Your Directors recommend their reappointment as Statutory Auditors forthe coming year.

The notes on accounts referred to in the Auditors' Report are self explanatory and do not call for any further comments.

Fixed Deposits

Your Company has not accepted any fixed deposits during the year 2011-12 and as such, there are no outstanding fixed deposits from the public as on 31 st March 2012.

CORPORATE GOVERNANCE

The Report on Corporate Governance along with the Auditors' Certificate regarding compliance of the conditions of Corporate Governance pursuant to Clause 49 of the Listing Agreement is annexed hereto and form part of the Annual Report. The Chief Executive and the Chief Financial Officer of the Company have submitted a certificate endorsing to the Board the correctness of the Financial Statements and other matters as required under clause 49 V of the listing agreement.

Transfer to the Investor Education & Protection Fund

In terms of Section 205C of the Companies Act, 1956 an amount of Rs. 1.21 lacs being unclaimed dividend was transferred during the year to the Investor Education and Protection Fund established by the Central Government.

Directors Responsibility Statement

In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956 and on the basis of the information furnished to them by the statutory auditors and the management, your Directors state that:

- In the preparation of the annual accounts for the financial year ended 31st March 2012, the applicable accounting standards have been followed and there are no material departures.

- They 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 your Company as at the end of accounting year and of the profit of your Company for the year.

- They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities.

- They have prepared the annual accounts on a going concern basis.

Disclosure of Statutory Particulars

Information required under Section 217 (1) (e) and Section 217 (2A) of the Companies Act 1956 are given in Annexure Aand B and forms part of this Report.

APPRECIATION

Your Directors would like to express their sincere appreciation to investors, bankers, customers, suppliers, auditors, company's associates and subsidiaries for their continued support during the year. Your Directors extend their sincere gratitude to all the regulatory agencies like SEBI, Stock Exchanges, Registrar of Companies and other Central and State Government authorities/ agencies. Stakeholders, Suppliers, Vendors and Sub contracting partners. Business associates for their support.

Your Directors also place on record their appreciation and thanks to all employees for their dedicated services rendered at various levels, without whose contribution, could not have achieved the year's performance and are looking forward to their continued support in the future as well.

Finally, the Directors also wish to place on record their special appreciation to the valued shareholders of your Company for their support.

By order of the Board

For Wendt (India) Limited

Chennai M M Murugappan

26th April 2012 Chairman

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Mar 31, 2011

The Directors have pleasure in presenting the 29th Annual Report together with the Audited Financial Statements for the year ended 31 st March 2011. The Management Discussion & Analysis Report, which is required to be furnished as per the requirement of Stock Exchanges, has been included in the Directors Report so as to avoid duplication and repetition.

COMPANY PERFORMANCE OVERVIEW

(Rs in Lacs)

31/03/2011 31/03/2010

Sales 8173 5609

Other Income 299 221

Profit before tax 2356 1455

Provision for tax 755 468

Provision for deferred tax 6 4

Profit after tax 1595 982

Earnings per share 79.76 49.12

RESULTS OF OPERATIONS

Resonating with the economical growth, your Company achieved a top line of Rs 8173 Lacs during the year which is 46% higher than the previous year. The domestic turnover recorded an appreciable growth of 54% over the previous year reflecting on better performance of many of the industrial

segments the Company operates. The major segments which contribute to your Companys growth are Automotive, Engineering, Cutting Tools and Steel that have had their positive impact on the Companys Domestic Business. The Export sales recorded a 17% growth during the year despite the slow industrial recovery in many of the developed nations including UAE which is still to experience signs of economic recovery.

In order to grow the business more aggressively as well as with increased focus, the Company had classified its businesses under three verticals- Super abrasives, Non-Super abrasives and International Business during end of 2009-10 which has now started paying rich dividends. Your Company is putting more efforts towards strengthening the Non Super abrasives business mainly comprising of machine tools and precision components. Like in past, it would continue to commit adequate investments in Plant and Machinery, Infrastructure and Human Resource.

During the year, your Company has successfully launched some of the new machines like CNC Rotary Surface Grinding with vertical spindle, CNC Guide Roll Grinder WGM35, 6-axes CNC Notch Milling Machine, Profile Grinding with Video Vision WDM 8V machine besides indigenously building Delapena Honing Machines.

Under Super abrasives, your Company continues to focus on the development of new products and new applications which would provide base for future growth. During the year, your Company has successfully introduced and tested several new products including Vitrified CBN wheels for Auto Component and Paper & Textile industry, High performance Electroplated CBN wheels for Automotive industry. Metal Bond wheels for Cutting Tools Industry, precision Dressing Rolls for Aerospace industry and Electroplated Diamond wheels for Ceramic industry.

During the year, your Company has also formally launched Innovation Management Process as one of the drivers for growth. It has initiated work on two new projects namely Low cost Resin Bond wheels and Vitrified Diamond Products besides strengthening its capability for Brazed products. Your Company is one of the few companies in India to have implemented Integrated Management Systems (IMS) by combining both Quality Management System and Environmental Management System. Your Company has achieved yet another milestone when Indias premier credit rating agency CRISIL conducted a comprehensive study commissioned by NSE and published the Independent Equity Research (IER) report about the Company - An ample evidence of your Companys commitment to strong business fundamentals and shareholder value creation.

FUTURE PROSPECTS

Aligning the management practices and policies with the Mission & Strategic Intent, the Companys three Broad Strategies continue to be:

- Continually improving product performance by use of technology & superior manufacturing. While the existing products would continue to be offered to the customers, new products and new application developments would be the focus.

- Market penetration to increase the share with existing customers.

- Developing competitive edge by improving service levels and offering value added services.

In order to achieve the objectives, your Company would strive hard to focus on Innovation for both products and processes to ensure sustained growth year on year. This would be well supported by deploying state-of-the-art technologies and process automation in critical areas as required. Harnessing the opportunities and potential in growing new industries such as Construction, Infrastructure, Defense, Aerospace, Railways and Steel would continue to be key focus for growth. Various initiatives such as trade shows, exhibitions in both domestic as well as overseas, customer training and other value added services are expected to strengthen the customer engagement levels with your Company.

The recent acquisition of Winterthur Technology Group (WTG) by the US multinational 3M Corporation and resultant acquisition of 40% equity share holding in your Company has been a matter of contention. The Company expects the ownership matter to be resolved soon. Once completed, your Company would take advantage of the opportunities that the change brings in and ensure to derive benefits from the multitude of possibilities for accomplishing its long term objectives.

SUBSIDIARY COMPANIES

Wendt Grinding Technologies Limited, Thailand

Inspite of continued political odds and subdued industrial activities, your Companys wholly owned subsidiary in Thailand presented yet another good performance. During the year the Companys top line was Thai Baht 70 mill. (Rs 1017 Lacs) which was 60% higher than last year. The Profit before tax was Thni Baht 24.4 mill (Rs 365Lacs) and Profit after tax was Thai Baht 17 mill (Rs 258 Lacs) both recorded an exceptional growth of over 100% ever the previous

year. The higher profit levels have been possible as a result of cost reduction initiatives, operational efficiency measures, enhanced product basket as well as market expansion. During the year the Subsidiary Company declared a dividend of 20% amounting to Rs.74Lacs.

In order to reinforce brand image and create increased recall, the subsidiary Company participated in major Industrial Trade exhibitions, conducted local advertising campaigns, technical seminars and prospected new market through surveys in addition to organizing plant tours for its key customers to showcase its capability. It also, added new industry specific distributors as partners and increased its product basket. As a part of business de-risking, it added solar glass panel manufacturers. The Company continues to focus on opportunities in industries such as Glass, Automobile, Steel, Auto parts, Engineering, Process, Wood, and Construction. Further, the Company is also exploring opportunities to extend re- profiling business to Vietnam, Laos and Cambodia.

Wendt Middle East FZE, Sharjah

The second wholly owned subsidiary in Sharjah, Wendt Middle East FZE, achieved a reasonable growth by closing with an annual sale of AED 916 (000s) (Rs.113Lacs) despite continued economic slowdown and recent social unrest. The loss for the year was AED 748(000s) (Rs 90Lacs) with a total accumulated loss of Rs.178Lacs. The volatility in the primary economic drivers such as Construction, Trading and Oil in the Middle East region further contributed to achieving the business lower than the plan.

However, the Company has worked on many new initiatives and strategies to minimize the impact of

continued economic slowdown by focusing on increased product range for Trading and concentrate on precision ground components. Additionally, the Company is also exploring opportunities to extend re- profiling, honing & grinding services to Iran, Egypt, Turkey and other adjoining countries. The renewed focus particularly in servicing industries like Glass Reinforced Plastic and Oil Exploration is expected to help the Company to tide over the current situation and achieve better results in the coming year.

APPROPRIATIONS

Available for appropriation (Rs in Lacs)

Profit after tax 1595.09

Add: Balance brought forward from previous year 724.35

Total 2319.44

Recommended appropriations

Transfer to general reserve 350.00

Proposed dividend Rs 25/- per share of face value of Rs 10/- each (250 %) 500.00

Dividend tax 83.04

Balance carried forward 1386.40

Total 2319.44

DIVIDEND

The Board of Directors have recommended a dividend of Rs. 25/- per equity share of face value of Rs.10/- each (250 %) and the same will be paid after the approval at the forthcoming Annual General Meeting. The dividend warrants will be posted on or after 5th August 2011.

CONSOLIDATED FINANCIAL RESULTS

The Ministry of Corporate Affairs vide its general circular no. 2/2011 dated 08/02/2011 has granted

general exemption in complying with the provisions of Section 212 (8) of the Companies Act, 1956 subject to fulfillment of certain conditions. The Ministry has further vide its letter dated 14/02/2011 informed the Company that approval of the Ministry is further not required.

A consolidated financial statement (incorporating the operations of the Company and its two subsidiaries) has been provided in the Annual Report. The key financial data for the consolidated operations are as given below:-

KEY CONSOLIDATED FINANCIAL SUMMARY

(Rs in Lacs)

31/03/2011 31/03/2010

Sales 9129 6154

Other Income 197 193

Profit before tax 2551 1520

Profit after tax 1684 998

Earnings per share-Rs 84.18 49.91

QUALITY

Your Company is into manufacture of high precision super abrasive (Diamond / CBN) grinding wheels, special tools, customized CNC Grinding / Honing machines and precision components meeting close tolerances and exacting standards. Tight process controls and Quality at each stage of operation is paramount for final output to meet up with customer requirement. Your Company constantly updates its quality programs to supply the right product at the right time. Lean management has also been introduced in certain production programs. Its manufacturing practices lay greater emphasis on training on latest trends on continual basis by creating a conducive atmosphere for learning across the

organization in addition to bench marking with the global best practices. Your Company continues to also invest on latest equipments to ensure that product quality meets the exacting Product standards.

SAFETY, HEALTH AND ENVIRONMENT (SHE)

The well crafted SHE management system of your Company is top driven and ensures effectiveness and adherence. The top management is committed to maintaining highest standards of Safety, Health and Environment protection for all applicable statutory norms and prevention of pollution requirements. Occupational health and safety continues to be an unremitting focus area for the Company. The safety policy is put in place to nurture a Zero Accident culture by adopting fail safe procedures, using best protective gears befitting the respective work areas, continuous training and enforcing compliance by vigilant Audit.

Your Company recorded zero accident during the year once again and has not lost even a single production man day on account of disability. Your Company accords high degree of importance to ensure a healthy and safe workplace for its own employees, the service providers including guests and visitors, by maintaining the highest levels of safety and occupational health standards across the organization. In order to make sure of the above, regular training on Safety, Fire hazards mock drills are conducted. Specialized Standard Personnel Protection Equipments are being provided to the operating personnel for use in their respective work areas.

General health & physical fitness of employees is of prime importance for your Company. Employees are required to undergo annual medical check-ups for timely diagnosis of their health condition. Your

Company has a qualified and competent doctor visiting the factory regularly to help the employees and their families to maintain good health condition and keep fit. Your Company also offers a mediclaim insurance policy that provides for hospitalization & major healthcare expenses to employees and their family members.

During the year, your Company has set up a fitness centre in the factory premises for its employees by equipping it with state-of-the-art fitness machines, equipments and gadgets. Employees are encouraged to use the fitness centre under the supervision of the practicing Physiotherapist.

Your Company had integrated its Quality Management System ISO 9001 and Environment Management System ISO 14001 and has been practicing Integrated Management System. Your Company is focusing on Occupational Health & Safety practices and initiatives and is now pursuing implementation of ISO 18001 and Social Accountability Standard SA 8000 during the year 2011-12. Your Company believes and follows the principles of good corporate citizenship that mandate the active contribution of companies towards ensuring employees Safety and Health and preserving Environment. Consequently, your Company has incorporated required operation systems to ensure zero accidents, Good Health & Zero Environmental impact.

RECOGNITIONS AND AWARDS

Recognition, Awards and accolades keeps the employees and the Company as a whole motivated for achieving higher results. During the year your Company has got the following awards

Engineering Export Promotion Council (EEPC) Award

This year yet again Engineering Export Promotion Council (EEPC) India conferred on us "Silver Shield for Star Performer" under Large Enterprise category for Miscellaneous Engineering Goods for the year 2008-2009. This is the seventh consecutive year that your Company is getting recognized by EEPC.

Best Manufacturing Award

Your Company has received the Best Manufacturing Award and Certificate of Recognition in the Machine Tools sector for Ranking No.1 under Top 500 SMB category for 2008-09 following a survey conducted by the Centre for Monitoring of Indian Economy (CMIE) in association with Industry 2.0 magazine for superior manufacturing performance.

Quality Circle Awards

At the National level, your Companys employee team participated in Quality Circle competition & has been awarded for SGA with "Distinguished Category" at the national convention NCQC 2010 organized by QCFI at Vishakhapatnam.

Like wise, at the Regional level, teams from your Company won many quality related awards such as Small Group Activities (SGA), Kaizen, Quality Quiz and 5S from participation in CCQC 2010 [Quality Circle Competitions] organized by QCFI, Bangalore Chapter.

CII Work Skill Competition

At the Regional level, one of the employees of the Company was ranked 2nd in the Turner Trade Competition organized by Cll and was advanced to the National Level.

CRISIL Independent Equity Research (IER) Rating

Your Company has been recognized by NSE as one of the few listed companies in India to have been practicing sound management systems and ethical norms based on strong business fundamentals. As advised by the NSE, Indias premier equity research agency CRISIL had conducted an Independent study of your Company across all facets of the business during the year. Based on the assessment, CRISIL has assigned a rating of "4/5" for Superior Fundamentals and "3/5" indicating Fair Market Valuation of shares.

Cufest 2010

Employees of the Company participated in Group- level Quality competitions "Cufest 2010" [Quality Festival of CUMI], and won awards for Quality Logo, Poster & Idea King events.

MGTC Cultural Meet

Women Employees of the Company participated in the cultural meet organized by Murugappa Group and won awards for individual talents.

In the section that follows, the information required to be given in the Management Discussion and Analysis Report have been provided

GENERAL PERFORMANCE REVIEW

During the year 2010-11, the Indian economy continued its momentum by maintaining the tempo ending with a reasonable GDP growth rate of around 8.3% in the midst of spiraling commodity prices. Despite the inflationary trend in foods, the economy was not out of the growth path. Accelerated

investments in Infrastructure, rapid rise in exports and growth in industrial out put helped the growth. Indias strong internal growth dynamics was most visible in segments like Automobile, Auto Component, General Engineering, Infrastructure & Construction and Steel. Resonating with the growth in Indian economy, the domestic business of Wendt (India) Limited grew by 54% and export achieving a growth of 17% over the last year. While the Super abrasive business grew by 26%, the Non-Super abrasive has shown an exemplary growth of 138% over the last year. The growth in the Super abrasives has come mainly from your Companys increased focus on growing industries in Domestic market such as Automotive, Cutting Tools, Engineering, Steel, Ceramics and Refractory. Continuous efforts on new product and new application development including working in close coordination with customers for import substitutions supplemented to this growth. The Non-Super abrasive business comprising of machine tools, accessories and precision components together recorded the above commendable growth. Capacity expansions and new projects in Steel sector, positive performance by Engineering, Railways and Cutting Tool industries together with sustained demand for precision components has enabled your Company to record this higher growth in the Non-Super abrasives business. While new variants & models in Machines were introduced in the market by your Company during the year, continued thrust on new product development, increased service levels and direct marketing efforts have helped to maintain its leadership position in the domestic market.

In order to increase customer base, provide prompt services and ensure sustained growth in the domestic arena, your Company created two additional regions namely Jaipur and Nashik during the year. This move will help your Company to complement its market presence and competitive edge.

While your Company continues to offer products and services to the existing industries such as Automotive, Cutting Tool, Engineering, Steel, Ferrite, Glass, Ceramics, Paper and Textile, it expanded the industry base to Railways, Aerospace, Construction, Infrastructure and Oil and Gas during the year. This is in line with your Companys underlying core objective of constantly looking for opportunities in growth sectors which is vital for the success. As a result, the comprehensive product range particularly in the Super abrasives business has become still more inclusive in terms of applications and product basket.

As you would recall, in order to bring more focus and direction to address sustained growth year-on-year, your Company had formed the Strategic Intent, followed by identification of Strategic Initiatives and deployment of Product Management approach few years back. To strengthen and support this, in the year 2009-10, your Company re-classified the businesses into three verticals namely Super abrasives, Non- Super abrasives and International Business. The above initiatives and underlying actions have complemented well and have started yielding results from this financial year 2010-11.

DIRECTORS

Mr. Shrinivas G Shirgurkar, Director retires by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment. The necessary Resolution is being placed before the shareholders for approval.

AUDITORS

M/s Deloitte Haskins & Sells, Chartered Accountants, the statutory auditors of the Company hold office, in accordance with the provisions of the Companies Act, 1956, are due for retirement at the ensuing Annual General Meeting and are eligible for reappointment, subject to the approval of the shareholders at the Annual General Meeting. Your Directors recommend their reappointment for the ensuing year.

FIXED DEPOSITS

The Company has not accepted any fixed deposits during the year 2010-11 and as such, there are no outstanding fixed deposits from the public as on 31 st March 2011.

CORPORATE GOVERNANCE

Your Company is compliant with the requirements of Clause 49 of the Listing Agreement. The Report on Corporate Governance along with a Certificate from the Auditors as stipulated under the above clause is attached to this report. The Chief Executive and the Chief Financial Officer of the Company have submitted a certificate endorsing to the Board the correctness of the financial statements and other matters as required under clause 49 V of the listing agreement.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the Companies Act, 1956 the Directors to the best of their knowledge and belief confirm that:

- In the preparation of the annual accounts for the financial year ended 31st March 2011, the applicable accounting standards have been followed.

- The accounting policies have been followed and applied consistently and the judgments and estimates made, are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2011 and of the profit of the Company for that period.

- Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies

Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities. To ensure this, the Company has established internal control systems, consistent with its size and nature of operations. In weighing the assurance provided by any such system of internal controls its inherent limitations should be recognized. These systems are reviewed and updated on an ongoing basis. Periodic internal audits are conducted to provide reasonable assurance of compliance with these systems.

- The annual accounts have been prepared on a going concern basis.

DISCLOSURE OF STATUTORY PARTICULARS

Information required under Section 217 (1) (e) and Section 217 (2A) of the Companies Act, 1956 are given in Annexure A and B and forms part of this Report.

APPRECIATION

The Board places on record its appreciation for the continued co-operation and support received from its esteemed customers, its Associates and Subsidiaries. The Board also places on record its appreciation for continued support and co-operation received from Government Departments, Bankers, Shareholders, Suppliers, and Employees.

By order of the Board For Wendt (India) Limited

M M Murugappan Chairman

Chennai 29th April 2011

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Mar 31, 2010

The Directors have pleasure in presenting the 28th Annual report together with the Audited Financial Statements for the year ended 31st March 2010. The Management Discussion & Analysis Report, which is required to be furnished as per the requirement of Stock Exchanges, has been included in the Directors Report so as to avoid duplication and repetition.

ECONOMIC OVERVIEW

Indian economy has been witnessing a phenomenal growth since the last decade. The country is still holding its ground in the midst of the current global financial crisis. A number of leading indicators, such as increase in hiring, freight movement at major ports and encouraging data from a number of key manufacturing segments, such as steel and cement, indicate that the downturn has bottomed out and highlight the Indian economys resilience. The real turnaround came in the second quarter of 2009-10 when the economy grew by 7.9 per cent. It was also a year of reckoning for the policymakers, who had taken a calculated risk in providing substantial fiscal expansion to counter the negative fallout of the global slowdown.

The continued recession in the developed world, for the better part of 2009-10, meant a sluggish export recovery and a slowdown in financial flows into the economy. Yet, over the span of the year, the Indian economy posted a remarkable recovery, not only in terms of overall growth figures but, more importantly, in terms of certain fundamentals, which justify optimism for the Indian economy in the medium to long term.

At global level, following one of the deepest downturns in recent times, economic growth took root and extended to advanced economies in the second half of 2009. The pace and shape of recovery, however, remains uncertain.

COMPANY PERFORMANCE OVERVIEW

(Rs in Lacs)

31/03/2010 31/03/2009

Sales 5609 5136

Other Income 221 309

Profit before tax 1455 1297

Provision for current

& Fringe Benefit tax 468 405

Provision for deferred tax 4 8

Profit after tax 982 884

Earnings per share 49.12 44.21



RESULTS OF OPERATIONS

The Company achieved a top line of Rs 5609 lacs during the year which is 9% higher than the previous year. The domestic turnover recorded an appreciable growth of 29% over the previous year. During the first half, the Indian economy limped back to normalcy and reversed the trend reflecting buoyancy in second half in many of the industrial segments the Company operate. Your Company having major exposures to the Automotive and the connected Engineering and Cutting tool sector, had its positive impact on the Companys Domestic Business. The Export sales recorded 29 % negative growth during the year. Exports to many countries continues to be lower than last year as these countries are still to come out of recession. Severe cash crunch situation in UAE has led to impose embargo on supplies to control exposure.

Various initiatives taken by the Company in the previous years to grow the precision Component business started showing results. The Company is also in the process of growing this business segment further in the coming years and would continue to make necessary investment in Plant and Machinery, infrastructure and human resource, accordingly.

The Company continues to focus on new products development in line with its strategy of providing technically superior products to its customers. During the year, the Company has successfully introduced and tested several new products including Segmented wheels for refractory grinding, plated diamond wheels, PCD Notch milling tools, Steel bodies for glass

grinding wheels and Brazed Diamond multi purpose Grinding wheel. The Company also successfully launched the following machines, CNC Surface Rotary Grinding WRS 600H Machine, CNC Guide Roll Grinder WGM20, CNC Notch Milling Machine.

FUTURE PROSPECTS

The three Broad Strategies of the Company continue to be:

- Continually improving product performance by use of technology & superior manufacturing. While the existing products would continue to be offered to the customers, new products and new applications development would be the focus.

- Market penetration to increase the share with existing customers.

- Develop competitive edge by improving service levels and offering value added services.

In order to focus and channelize its resources more effectively, the Company segmented its business into three verticals namely Super Abrasives, Machines & Precision components and International Business. Further, in order to strengthen the customer engagement, your Company would bank on its knowledge base in grinding to achieve its objectives. Series of Seminars and Exhibitions planned would help in supporting the customer engagement.

The Company has recently signed the technical collaboration agreement with M/S Delapena, UK for manufacturing of Honing machines. This would enable the company to further strengthen its competitive edge by offering “Complete Honing Solutions” also along with grinding solutions. The Company will continue to focus on opportunities for its products and services in other growing industries such as Auto Component, Infrastructure & Construction, Steel, Defense & Aerospace.

SUBSIDIARY COMPANIES

Wendt Grinding Technologies Limited, Thailand

Despite turbulent economic situation, the Companys wholly owned subsidiary in Thailand continues to

perform well. During the year the Companys top line was Thai Bhat 45 miln (Rs 637 lacs) which was 4% higher than last year. The Profit before tax was Thai Bhat 12 miln (Rs 153 lacs) and Profit after tax was Thai Bhat 8 miln (Rs 103 lacs) both recorded an appreciable growth of 27% over the previous year. The higher profit has resulted on account of various cost reduction measures and operational efficiency measures put in place by the subsidiary Company. During the year the Subsidiary Company declared the first dividend of 20% amounting to Rs 71 lacs.

The Subsidiary Company, in order to build brand image and product awareness, participated in industrial exhibitions, developed local advertising materials, conducted technical seminars and sales meet. It has also, appointed new industry specific distributor as partners in progress. The Company is working with a clear focus to build business in following industries, Glass, Automobile, Steel, Auto parts, Wood, Furniture and Construction industry. Further the company is also exploring opportunities to extend re-profiling business to Malaysia, China & Vietnam. During the year, the company has upgraded "ISO9001-2008"certification with strong recommendation from "TUV NORD".

Wendt Middle East FZE

The Company started its billing in August 2009 and during the year the sales was AED 179(000s) (Rs 23 lacs). The loss before tax for the year was AED 642 (000s) (Rs 88 lacs). The total accumulated loss is Rs 96 lacs. The Global meltdown severely affected the sale. The Middle East in General and UAE in particular are reported to have been going through the most severe economic crisis in their history. The Middle East being a Trading Economy is primarily driven by oil and construction.

While oil prices have stabilized at a low of 65 USD per barrel the construction has seen a massive decline with over 60% projects either shelved or stopped half- way. The slowdown compounded with a steep increase in operation costs has resulted in many businesses closing down and many migrants forced to return back to their countries.

Even though your subsidiary started the business midway during the year, the crisis has impacted on the

companys sale and profitability. Accordingly the market development and the revenue generation from servicing activity for glass grinding and Tile Plant wheels did not happen as expected.

However the company has quickly adopted new strategies to counter the slowdown by focusing more on Trading. The focus on un-explored opportunities in Glass Re-enforced Plastic Industry and oil Industry is expected to help the company to counter the recession and recover from the present crisis.

APPROPRIATIONS

Available for appropriation
Profit after tax 982.33

Add: Balance brought forward from previous year 675.06

Total 1657.39

Recommended appropriations

Transfer to general reserve 350.00

Proposed dividend Rs 25/- per share of

face value of Rs 10/- each (250 %) 500.00

Dividend tax 83.04

Balance carried forward 724.35

Total 1657.39



DIVIDEND

The Board of Directors have recommended a dividend of Rs.25 /- per equity share of face value of Rs.10/- each (250%) and the same will be paid after the approval at the forthcoming Annual General Meeting. The dividend warrants will be posted on or after 5th August 2010.

CONSOLIDATED FINANCIAL RESULTS

The Ministry of Corporate Affairs vide its letter dated 15/03/2010 has exempted the company in complying with the provisions of section 212(1) of the Companies Act, 1956 and has directed to present in the annual report the consolidated financial statements of its subsidiaries duly audited by its statutory auditors.

A consolidated financial statement (incorporating the operations of the Company and its Subsidiaries) has been provided in the Annual Report. The Key financial data for the consolidated operations are given below:-

KEY CONSOLIDATED FINANCIAL SUMMARY

(Rs in Lacs)

31/03/2010 31/03/2009

Sales 6269 5600

Other Income 193 277

Profit before tax 1520 1381

Profit after tax 998 931

Earnings per share-Rs 49.91 46.54



QUALITY

The Companys products are high precision grinding wheels, tools, machines and precision components. These are manufactured with close tolerance under tighter process controls. Quality at each level of operation is essential to achieve the final quality to meet the customer need. The Company constantly updates its quality programs to supply the right product at the right time. Quality is embedded in the DNA of the Organization through continued training of manpower and bench marking with the global best practices with Best in class.

SAFETY, HEALTH AND ENVIRONMENT (SHE)

The SHE management system of the Company is top driven, efficient, effective and vibrant management system. Top management of company is committed for maintaining highest standard of Safety, Health and Environment protection and is also committed to meet all applicable statutory requirement and prevention of pollution.

During the year again the Company recorded zero accident and has not lost any man days of production on account of disability. The Company pays much attention and ensure safe working atmosphere and safe equipment, process and practices in the factory. Regular training on Safety, mock drills are conducted to ensure safety all round the year. Specialized Personnel Protection Equipments have been standardized and provided to operating personnel for use in their respective work areas.

Employee health is a paramount consideration for Company. Employees are required to undergo annual medical check-ups for the timely diagnosis of health problems if any. The Company has a visiting doctor at the factory to help the employees and their family to maintain good health and keep fit. The company also offers a mediclaim policy that provides for healthcare expenses and other benefits to employees and their family members.

The Company has developed Environmental Management System based on ISO 14001 at each operating facility which is further integrated with Quality, Occupational Health and Safety management System for having holistic approach towards (SHE) issues of the company. The Company believes in the principles of good corporate citizenship that mandate the active contribution of companies towards preserving the environment. Accordingly, the Company has incorporated in its operations systems to ensure zero environmental impact.

RECOGNITIONS AND AWARDS

Recognition and awards motivates the Company and its employees to achieve better results. During the year the Company has got the following awards Engineering Export Promotion Council (EEPC) AWARD

Engineering Export Promotion Council (EEPC) conferred on us "Silver Shield for Star Performer" under Large Enterprise category for Miscellaneous Engineering Goods for the year 2007-2008. This has been yet another year of your Company getting recognized by EEPC.

Quality Circle Awards

Two Small Group Activities (SGA) teams of the Company participated in CCQC 2009 [Quality Circle Competitions] organized by QCFI, Bangalore Chapter and have bagged awards in “Excellence” and "Distinguished" categories.

Cufest 2009

Participated in Group level Quality competitions Cufest 2009 [Quality Festival of CUMI], won following awards: 5S, Quality Slogan & Cartoon.

In the section that follow, the information required to be given in the Management Discussion and Analysis Report have been provided.

GENERAL PERFORMANCE REVIEW

During the year 2009-10, the Indian economy bounced back to the growth trajectory particularly after the first quarter, maintaining a healthy pace by recording an impressive growth in excess of 8%. This impressive growth was fuelled by improved productivity from a buoyant industrial sector with IIP of 10%, reflecting Indias strong internal growth dynamics in most noticeable segments like Automobile, Auto Component, Infrastructure & Construction, Steel and General Engineering. On the other hand, Indias export continued to be sluggish due to prolonged economic slow down in developed nations.

The growth in Indian economy has augured well for domestic business of Wendt India Limited. While the Super abrasive products sale for the company grew by 6%, the Non Super abrasive business comprising of precision components and machine tools together recorded a growth of 15% over the last year. This has been possible due to the continued thrust on application development, widening the product basket, new product development, superior products performance and being closer to customers through continued direct marketing efforts. This has helped your company to maintain its leadership position in the Super abrasive arena in the competitive domestic market. Wendts strong presence has been with all major industries where it operates namely Automotive, Cutting Tool, Engineering, Steel, Ferrite, Glass, Ceramics, Paper and Textile. Your companys competitive edge is derived from the most comprehensive product range in Resin, Metal, Electroplated and Vitrified bonding systems along with Diamond Dressing rolls and Honing sticks. Your Company philosophy of addressing the customers needs and expectations have been key to its success.

In line with the companys Strategic Intent “To become a Significant Global Player in offering Customized, Functionally Superior Products / Services for Grinding and Machining Hard-to- Process Material”, Wendt India is continuously searching for new business opportunities to enlarge its product canvas in the promising industry segments.

In order to take advantage of the growing economy and achieve aggressive growth in the chosen industries, your company has classified its business into two major segments - Super Abrasives comprising of all Diamond / CBN Products and Non

Super Abrasives comprising of Machine Tools and Precision Components.

During the fiscal, your company has signed technical collaboration with M/S Delapena Honing Machines, a well known company in UK, for manufacturing of Honing machines in India. This collaboration, apart from being the Segmental strengthening of the Non Super abrasive business, enables your company to become a “Total Honing Solution Provider”. To sum up, despite the high inflationary market movements, input cost pressures, a yet- to-be stabilized domestic market and continued economic slow down in overseas markets, your company has had a decent year, fuelled by a buoyant domestic market.

ECONOMIC OUTLOOK

The gloom prevailing last year has given way to optimism and confidence during the year 2010-2011. The growth optimism is resonated by around 8.3% growth expected in the coming year. There is a growing consensus world over that worst of the financial crisis is over. After having contracted in 2009, the global economy is expected to expand during 10-11. The Indian economy has displayed remarkable resilience by engineering a substantial increase in demand through fiscal measures to compensate for the decline in export. The focus has now turned towards domestic consumption and investments - the key drivers of growth in the coming year.

Demand in Domestic economy has already picked up and is expected to gather momentum in coming months. The capital goods market has shown impressive growth during the year aided by substantial growth in production in metal and metal parts and machinery & equipment.

The Industrial sector is expected to play a crucial role in driving the growth in GDP during FY11. Focus on infrastructure spending by the government and an increase in investment demand by the corporate would provide impetus to the industrial production.

The auto component industry is expected to have a healthy growth in on the back of revival in demand from domestic OEMs. However, the export sales volume is expected to remain flat during 10-11. Nevertheless, the export market could gain faster momentum due to expected marginal revival of global market and cost competitive prices of Indian manufacturers.

The Indian automobile market which grew by 22% during 09-10 with strong recovery across all segments, the exports growth was 10% aided by buoyancy in passenger car segment which constitutes almost 25% of total exports. Recovery in Commercial vehicles could be attributed to improved freight movements. Similarly, fuelled by rural demand and favorable financing environment led higher volumes in cars and two wheelers. Overall lower input costs, reduced fixed costs and improved operating profits led to sharp improvement for automobile players.

The Indian steel industry is witnessing a faster-than- expected recovery from the global financial and economic slowdown. The steel industry is expected to continue its recovery with projected growth of 6.7% during 10-11 driven by strong demand from infrastructure, railways, urban development and automotive sector despite rise in excise duty and cess on coal.

INDUSTRY STRUCTURE & DEVELOPMENTS

Being an indirect supplier, the Super abrasive tooling industrys growth is greatly dependent on the performance of sectors like automobile, auto components, engineering and their related industries in both domestic and export market. With the reversal of domestic economy from 2009-2010 second half in many segments and limping back of export from the unprecedented global economic crisis, your company has had a rather satisfying year 2009-10.

The global economic downturn and volatility has impacted the Super abrasive industry resulting in market shrinkage by over 20 % in the preceding year which is expected to return to positive in later part of the year. Taking cognizance of this, proactively, your company continued to focus on long term plans and has been working on various strategies to widen the portfolio to reduce dependency and de-risking the business on Auto industry. As a result, several newer application areas in various emerging industries and markets have been identified with industries like Aeronautical, Construction, Petroleum and Chemical, Power and Glass.

PERFORMANCE OVERVIEW

Key Financial Summary

(Rs in lacs)

Particulars 2008-09 2009-10 % change

Domestic Sales 3389 4368 29

Export Sales 1747 1241 (29)

[Total Sales 5136 5609 9

Operating Profit 1035 1289 25

[Capital Employed 4668 5035 8

[Return on net worth 21 21 -



OPPORTUNITIES & THREATS

Opportunities

While Indias growth prospects in the long term remain promising, presently the economy is still to go through full consolidation to ensure robust growth. During the last year, the overall sentiment post Sept 09 has been extremely positive. Your company would take advantage of this rebounce and the underlying opportunities by continued focus on leveraging on the wide product range, superior technology and resultant competitive advantage. With improved focus on service levels, your company expects to broaden the customer base and achieve the planned growth.

The Product Management approach adopted by your company in 08-09 has started yielding better results with more emphasis on end-to-end product management and new product development. With the addition of Delapena Honing machines to the existing machine tool umbrella is expected to provide more impetus to the Machine Tools business while taking the company to the next league of providing "Total Honing Solution Provider".

On the precision component front, the experience has been more than satisfying ever since its entry two years back with manufacture of vane components for fuel injection Industry. More thrust would be given by your company to further expand this business for manufacturing of precision components for non automotive segment.

Threats

With the Super abrasive tooling market in India being fragmented and crowded by many small unorganized players, the company faces competition from both organized as well as unorganized players. The competition especially from the unorganized players has been more towards specific products at lower price levels. The global suppliers from the developed countries primarily concentrate on high end precision applications and OEM supplier by their tooling up with machines which are imported. This in fact is an opportunity for your Company for indigenization.

The key success factors for your company continue to be quality, cost effectiveness of its products, service and its vast experience and knowledge pool. It is now augmented by your company offering training programs on grinding to its customers on chargeable basis. The response has been very promising. More of such training programs have been planned during the year 2010-11. Combination of all this in offering technology solutions to customers helps your company to maintain its leadership position and profitability.

BUSINESS OUTLOOK

The domestic market is expected to maintain uptrend with few exceptions in some industry segments. Your company is fully geared to meet the demand and delivery pressures resulting out of the buoyancy and also taking advantage of the emerging opportunities.

Continued focus on expansion of customer base and developing new application areas / industries, offering import substitution, thrust on improving operational efficiency is expected to yield positive results. This will help your company to churn out respectable profitable growth in the coming year.

The introduction of Wheel profiling machines with Video Vision system, Delapena Honing Machines, Guide Roll grinding machine for Steel Industry and several other machine accessories as well as for precision component to non automotive sector re- establishes the Companys confidence to look at Non Super abrasive Business more aggressively.

The newly set up 100% subsidiary at Sharjah, Wendt Middle East (WME) which became operational only during mid of last financial year now focuses on trading and services in the UAE and neighboring market. This would strengthen its foothold on overseas markets.

Wendt Grinding Technologies Ltd in Thailand continues to show exemplary performance despite adverse market situations due to the economic slowdown. Your company expects to spread its wings, improve the market reach in the neighbouring countries.

RISK & CONCERN

The company seeks to enhance its value through adequately mapping the risk profiles and by incorporating a robust risk mitigation mechanism for its business.

Risk management refers to the formal processes whereby risks associated with the “enterprise”, as a whole are managed.

Risk management encompasses the following sequence:

- Identification of risks and risk owners

- Evaluation of the risks as to likelihood and consequences

- Assessment of options for mitigating the risks

- Prioritizing the risk management efforts

- Development of risk management plans

- Authorization for the implementation of the risk management plans

- Implementation and review of the risk management efforts

Risk management strengthens the robustness of the business. The Company has an established risk assessment and minimization procedure. There are normal constraints of time, efficiency and cost. Some of the risks associated with the business and the related mitigation plans are discussed hereunder. The risks given below are not exhaustive and the evaluation of risk is based on managements perception.

User Industry Concentration Risk

Why considered as Risk

- Significant exposure to auto sector

- Lag in pass through of input cost changes

- Demand declining in global markets

Mitigation Plan / Counter Measure

- Widen customer base spanning non-auto industry & recession free industries like Power, Aerospace, Defense, Infrastructure etc.

- New products / applications to existing / new customers / New markets

- Leverage relationship and Engagement with customers

- Drive operational efficiencies

Competition Risk

Why considered as Risk

- Imports - Since India is the most happening place

- Unorganized players

Mitigation Plan / Counter Measure

- Focus on QCD - Consistent quality , Cost & timely delivery

- Innovate on products, process and applications

- Offer wide product range

- Value added services

INFORMATION TECHNOLOGY:

The Company runs on SAP ERP and all its core functional operations are well integrated to achieve operational efficiency. During the year, up-gradation to higher version has been completed successfully to take advantage of the new features. During the year, the Company has also implemented SAP HCM module to effectively link the Human Resource Management system with other system. The SAP HCM also enables employee to interact with HR Department on-line, there by avoiding time delay and paper movements.

In order to mitigate the risk of Hardware failure, the Company has put in place first stage data backup and

recovery systems and planning to go for a higher level / robust data back up and recovery system in the coming year.

INTERNAL CONTROL SYSTEM & ADEQUACY

The Company is having a strong internal control system to achieve highest operational control. The Internal Audit covers all the operational areas and ensure that there is no revenue leakage or resource wastage. It also ensures that the Companys policies are implemented consistently and regularly. At regular intervals all observations and potential areas for improvements are reviewed with the concerned operating personnel to address the gaps if any.

The Audit Committee reviews the significant findings of the Internal Audit observation and advise at regular intervals for further action.

FINANCIAL REVIEW

EARNINGS

Revenues

The revenue, during the year, recorded 9% growth from Rs 5136 lacs to Rs 5609 lacs. The domestic sales achieved an appreciable growth of 29% while exports sales recorded a negative growth of 29% compared to the previous year.

Profit Before Tax

The profit before tax is higher by 12% from Rs 1297 lacs to Rs 1455 lacs

Profit After Tax

The profit after tax is higher by 11% from Rs 884 lacs to Rs 982 lacs

Investments

The Companies investment as on 31-3-10 was Rs 1672 lacs compared to Rs 1200 lacs previous year .Out of this amount Rs 394 lacs (Previous year Rs 297 lacs)

is invested in two wholly owned subsidiary companies and the balance is in Mutual funds (debt schemes). During the year the Thailand Subsidiary Company has paid 20% dividend amounting to Rs 71 lacs. In the case of Wendt Middle East FZE, the accumulated loss was Rs 96 lacs as at 31-3-2010 and the paid up capital was Rs 116 lacs.

Costs

The Fixed costs have grown 11% compared to last year. The main component of fixed cost depreciation has grown 18 % due to additional machines, sales expenses has grown by 19% on account of more sales promotion activities such as exhibitions, seminar and provision for doubtful debts etc. The salaries and wages have grown 16% due to additional manpower and provisioning done as per the revised accounting standard AS 15.

The variable cost has come down due to product mix and improved operational efficiency resulting into higher operating profit margin.

FINANCIAL POSITION

Shareholder Funds

The shareholders fund as on 31.03.2010 was Rs 4803 lacs against Rs 4403 lacs of previous year. The book value of the share accordingly stands at Rs 240/- as compared to Rs 220/- during the previous year.

Loan Funds

The Company utilizes the Cash Credit limit only for meeting the temporary mismatch in the cash flow. It does not have any term loan.

Assets Fixed Assets

The capital expenditure during the year was Rs 658 lacs against Rs 752 Lacs spent in the previous year. The net fixed asset was Rs 2950 lacs compared to Rs 2611 lacs previous year.

Inventories and Sundry Debtors

The overall inventory has gone up by Rs 182 lacs compared to previous year, mainly on account of increase in Work-in-Progress machine inventory by Rs 126 lacs. This was due to delay in clearance by customers as tests / trials could not be completed in March 2010 and also for supporting the on call supplies to the customers.

Despite 9% increase in Sales, the Receivables has come down by Rs 83 lacs compared to last year due to dynamic and more aggressive receivable management drive aided by SAP ERP system.

Foreign Exchange Hedging

As the Company follows the policy of natural hedging of foreign exchange earnings and outflow it does not take forward covers. The net forex gain during the year was Rs 10 lacs.

Ratio

The return on the capital employed was 30% compared to 29% in previous year as a result of 12% increase in profit.

Financial Performance with respect to Operational Performance

The operating profit and Contribution of the Company has recorded growth during the year due to improved operational efficiency. Thanks to the availability of reliable information and effective customer data such as drawings, specification, data sheet through the SAP ERP System, the Company improved its response time and was able to supply the right product at the right time with right specifications there by enhancing the value addition to customer.

HUMAN RESOURCE

The Company maintains a congenial working atmosphere, which has been nurtured over the years though trust and transparency in all its dealing with its employees though vibrant Human Resource

policies, procedures and practices. The healthy relationship with employees enables your Company to follow flexible working systems / shop floor management, in its more than 13 production cells, to meet the varying customer needs.

The Company gives very high importance for enhancing the employees competency and skill through on the job training and external training programs. Through constant interaction with its foreign collaborators by means of visits etc, Your Companys employees have been trained on latest technology. The Marketing and Sales Field Personnel have been trained and updated with the intricacies of modern day marketing and sales, tools and techniques, while honing their Commercial aspects through specialized training programs.

Employees are encouraged to participate in external competition to enhance their skills and bench mark with the global best practices.

DIRECTORS

Mr. Kiran A Sheth, Director retires by rotation at the forthcoming Annual General Meeting has expressed his unwillingness to be re-appointed and a new director will be appointed.

AUDITORS

M/s Deloitte Haskins & Sells, Chartered Accountants, who are the statutory auditors of the Company hold office, in accordance with the provisions of the Companies Act, 1956, up to the conclusion of the forthcoming Annual General Meeting and are eligible for reappointment, subject to the approval of the shareholders at the Annual General Meeting.

FIXED DEPOSITS

The Company has not accepted any public deposits and, as such, no amount on account of principal or interest on public deposits was outstanding on the date of the Balance Sheet.

CORPORATE GOVERNANCE

The Report on Corporate Governance along with a

Certificate from the Auditors is annexed as required by the listing agreement with Stock Exchanges. The Chief Executive and the Chief Financial Officer of the Company have submitted a certificate to the Board regarding the financial statements and other matters as required under clause 49 V of the listing agreement.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the Companies Act, 1956 the Directors to the best of their Knowledge and belief confirm that:

- in the preparation of the Profit & Loss Account for the financial year ended 31st March 2010 and the Balance sheet as at that date ("financial statements") applicable accounting standards have been followed.

- Appropriate accounting policies have been selected and applied consistently and such judgments 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 the end of the financial year and of the profit of the company for that period.

- Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities. To ensure this, the company has established internal control systems, consistent with its size and nature of operations. In weighing the assurance provided by any such system of internal controls its inherent limitations should be recognized. These systems are reviewed and updated on an ongoing basis. Periodic internal audits are conducted to provide reasonable assurance of compliance with these systems.

- The financial statements have been prepared on a going concern basis.

DISCLOSURE OF STATUTORY PARTICULARS

Information required under Section 217 (1) (e) and Section 217 (2A) of the Companies Act 1956 are given in Annexure A and B and forms part of this Report.

APPRECIATION

The Board places on record its appreciation for the continued co-operation and support received from its esteemed customers and from M/s Wendt GmbH Germany, the Companys foreign Collaborators and its Associates and Subsidiaries. The Board also places on record its appreciation for continued support and co- operation received from Government Departments, Bankers, Shareholders, Suppliers and Employees.

By order of the Board For Wendt (India) Limited

Chennai M M Murugappan

29th April 2010 Chairman