DIRECTORSDREPORT

To,

The Members,

AURO LABORATORIES LIMITED

Your Directors have great pleasure in presenting the 26* Annual Report together with the Audited Accounts for the year ended March 31, 2015.

2. REVIEW OF OPERATIONS:

During the year under review, the Company earned total revenue of Rs. 3288.84 Lacs as against Rs. 3380.64 Lacs in the previous year. The Profit before tax wa s Rs. 80.39 Lacs as against Profit of Rs. 57.90 Lacs in the previous year.

Your Company is undertaking expansion plan in existing unit to increase production capacity and undertaking active efforts towards accelerating the growth speed and is optimistic about better performance in the future..

3. DIVIDEND & TRANSFER TO RESERVES:

To consolidate the financial position of the Company, the Board does not propose any dividend for the year ended March 31, 2015. The Board does not propose to transfer any amount to General Reserves for the aforesaid financial year.

4. SHARE CAPITAL OF THE COMPANY:

The Paid up Equity share Capital, as at 31" March, 2015 was Rs.623,25,000/- divided into 62,32,500 Equity shares, having face value of Rs.10/- each fully paid up. During the year under review, the Company has not issued any shares with differential voting rights nor granted any stock neither options nor sweat equity.

5. SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES:

The Company does not have any subsidiaries, joint ventures or associate companies.

6. MATERIAL CHANGE IN THE NATURE OF BUSINESS:

There was no change in the nature of business activities during the Financial Year 2014-15.

7. BOARD OF DIRECTORS:

In accordance with the provisions of Section 152 of the Companies Act 2013 and the Articles of Association of the Company, Mr. Sharat Deorah, Director of the Company, retires by rotation at the forthcoming Annual General Meeting and being eligible offers himself for re-appointment.

During the year under review, the Company has appointed Mrs. Kavita Vijayakant Sharma as an Additional Director at the Board Meeting held on 27th March, 2015. Your Board proposes to regularize her appointment at the forthcoming Annual General Meeting.

8. DECLARATION BY INDEPENDENT DIRECTOR (S):

Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act.

9. DIRECTORS RESPONSIBILITY STATEMENT:

As required under the provisions of Section 134 of the Companies Act, 2013, your Directors report that:

i. In the preparation of the Annual Accounts, the applicable accounting standards had been followed along with proper explanation relating to material departure, if anyQ

ii. The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;.

iii. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities

iv. The Directors had prepared the annual accounts on a going concern basis.

v. The Directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively

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

11. COMMITTEES OF THE BOARD:

11.1 AUDIT COMMITTEE:

The Company has a qualified and independent Audit Committee comprising of Independent and Executive Directors constituted in compliance with the provisions of Section 177 of the Companies Act, 2013 and the Listing Agreement with the Stock Exchange. The Audit Committee acts in accordance with the terms of reference specified from time to time by the Board.

11.2 NOMINATION &REMUNERATION COMMITTEE:

The Company has renamed the existing Remuneration Committee to "Nomination and Remuneration Committee" pursuant to Section 178 of the Companies Act, 2013. The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. The policy lays down the criteria determining qualifications, positive attributes, independence of a director and other matters pursuant to the provisions of sub-section (3) of Section 178 of the Companies Act, 2013.

11.3 SHAREHOLDING OF NON-EXECUTIVE INDEPENDENT DIRECTORS

The shareholding in the Company by the Non-Executive Independent Directors in their own name is NIL.

11.4 STAKEHOLDERS RELATIONSHIP COMMITTEE:

The Board of Directors of the Company has re-named a .Stakeholders Relationship Committeefjn order to align K with the provisions of Section 178 of the Companies Act, 2013. The Committee has been constituted to strengthen the investor relations and to inter-alia, look into issues relating to shareholders grievances pertaining to transfer of shares, non- receipt of declared dividends, non-receipt of Annual Report, issues concerning de-materialization etc.

12. VIGIL MECHANISM / WHISTLE BLOWER POLICY:

The Company has a Vigil Mechanism / Whistle Blower policy to report genuine concerns, grievances, frauds and mismanagements, if any. The Vigil Mechanism /Whistle Blower policy has been posted on the website of the Company (www.aurolabs.com)

13. BOARD EVALUATION:

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an evaluation after taking into consideration various aspects of the Boardg functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, remuneration, obligations and governance.

The performance evaluation of the Independent Directors was completed. The performance evaluation of the Chairman and the Whole-time Director was carried out by the Independent Directors at their meeting held on 13"1 February, 2015. The Board of Directors expressed their satisfaction with the evaluation process

15. CODE OF CONDUCT:

Your Company is committed to conducting its business in accordance with the applicable laws, rules and regulations and highest standards of business ethics. In recognition thereof, the Board of Directors has implemented a Code of Conduct for adherence by the Directors (including Independent Directors), Senior Management Personnel and Employees of the Company. This will help in dealing with ethical issues and also foster a culture of accountability and integrity. The Code has been posted on the Companyg www.aurolabs.com

All the Board Members and Senior Management Personnel have confirmed compliance with the Code.

16. FIXED DEPOSIT:

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

17. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

The details of loans, guarantees and investments covered under Section 186 of the Companies Act, 2013 read with Companies (meeting of Board and its Powers) Rules, 2014 form part to the financial statements in this Annual Report:

18. ISO CERTIFICATION:

The Company^ products were awarded as ISO 9001:2008 Certification.

19. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

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

20. EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in form MGT-9, as required under Section 92 of the Companies Act, 2013, is included in this Report as Annexure -Alland forms an integral part of this Report.

21. RELATED PARTY TRANSACTIONS:

During the Financial Year 2014-15 your Company has not entered into related party transaction & hence provisions of Section 188 of the Companies Act, 2013 are not applicable to Company.

22. STATUTORY AUDITORS:

Mis. Kothari Jain & Associates, Chartered Accountants, (Firm Registration No.113041W) were appointed as the Statutory Auditors of the Company at the AGM held on 6th September, 2014 to hold office until the conclusion of the third consecutive AGM, are recommended for ratification of appointment for the Financial Year 2015-16. As required under the provisions of Section 139 of the Companies Act, 2013, the Company has obtained written confirmation from M/s. Kothari Jain & Associates that their appointment, if made, would be In conformity with the limits specified in the said Section.

23. SECRETARIAL AUDIT:

Pursuant to provisions of Section 204 of the Companies Act, 2013 and the Rules made there under, the Company has appointed M/s. GMJ & Associates, Company Secretaries to undertake the Secretarial Audit of the Company for the year ended March 31, 2015.

The Secretarial Audit Report is annexed herewith as Annexure JBITand forms an integral part to this Report.

24. COST AUDIT:

Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with Rules made there under, Cost Audit is not applicable to the Company for the Financial Year 2014-15.

25. AUDITOR^ REPORT/ SECRETARIAL AUDIT REPORT:

The observations of the auditors contained in their Report have been adequately dealt with in the Notes to the Accounts which are self explanatory and, therefore, do not call for any further comments.

The Secretarial Audit Report does not contain any qualification, Reservation or adverse remark.

26. OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:

In order to prevent sexual harassment of women at work place a new act The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 has been notified on 9* December, 2013.

The primary objective of the said Policy is to protect the women employees from sexual harassment at the place of work and also provides for punishment in case of false and malicious representations. During the financial year 2014-15, Company has not received any complaint of sexual harassment against women employees of the Company.

27. RISK MANAGEMENT POLICY:

Your Company recognizes that risk is an integral part of business and is committed to managing the risks in a proactive and efficient manner; your Company periodically assesses risks in the internal and external environment, along with the cost of treating risks and incorporates risk treatment plans in its strategy, business and operational plans.

During the year, your Directors have framed a Risk Management Policy (a) to ensure that all the current and future material risk exposures of the Company are identified, assessed, quantified, appropriately mitigated, minimized and managed i.e. to ensure adequate systems for risk management (b) to establish a framework for the company^ risk management process and to ensure its implementation (c) to enable compliance with appropriate regulations, wherever applicable, through the adoption of best practices (d) to assure business growth with financial stability.

There are no risks which threaten the existence of the Company

28. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is defined by the Audit Committee. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board & to the Managing Director.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies of the Company.

Based on the report of internal audit function, the Company undertakes corrective action in their respectve areas and thereby strengthens the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee of the Board.

29. DEPOSITORY SERVICES:

The Company s Equity Shares have been admitted to the depository mechanism of the National Securities Depository Limited (NSDL) and also the Central Depository Services (India) Limited (CDSL). As a result the investors have an optionto hold the shares of the Company in a dematerialized form in either of the two Depositories. The Company has beenallotted ISIN No. INE292C01011.

Shareholders therefore are requested to take full benefit of the same and lodge their holdings with Depository Participants [DPs] with whom they have their Demat Accounts for getting their holdings in electronic form.

30. PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO:

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to Section 134(3)(m) of the Companies Act, 2013, read with the Rule 8(3) of the Companies (Accounts) Rules, 2014 is given in Annexure .CITto this Report

31. PARTICULARS OF EMPLOYEES:

The information required pursuant to Section 197 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure "D" to this Report.

None of the employees have drawn remuneration more than Rs. 5,00,000/- p.m., if employed for the part of the year and Rs. 60,00,000/- p.a., if employed throughout the Financial Year as covered under Rule 5 (2) of the Companies Appointment and Remuneration of Managerial Personnel) Rules, 2014.

32. CORPORATE GOVERNANCE:

Clause 49 of the Listing Agreement on Corporate Governance is not applicable to the Company for the Financial Year 2014­15.

33. LISTING:

The Company Shares are listed on BSE Limited, Mumbai. The Company has paid Listing Fees for the Financial Year 2015-16.

34. EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS:

There were no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements related and the date of the report.

35. CORPORATE SOCIAL RESPONSIBILITY:

Provisions of Section. 135 of the Companies Act 2013 read with the Companies (Corporate Social Responsibility Policy) Rules 2014 are not applicable to the Company during the Financial Year 2014-15 as the Company did not have the profits as set out in the said section.

36. ENVIRONMENT AND SAFETY:

The Company is committed to:

Maintain an organizational culture of Health, Safety & Environmental excellence by conducting its business in a manner that will promote consistent development.

Safe work, resource conservation, waste management and emergency response measures for continual improvement in performance.

Design, construct, operate & maintain its facilities while assuring the best material and service quality and operate in a way that mitigates and minimizes risks and hazards.

Prevention of ill-health, injuries and pollution by adopting best practices, carrying out periodic risk assessments, audits, reviews, inspections and providing awareness to employees and concerned stakeholders.

37. NEW SET OF ARTICLES OF ASSOCIATION:

In conformity of the provisions of the Companies Act, 2013, it is proposed to adopt new set of Articles of Association of the Company. Necessary Special Resolution is placed for memberfj approval.

38. STEPS FOR PREVENTION OF INSIDER TRADING:

In compliance of the SEBI (Prevention of insider Trading) Regulations as amended in 2015, the Company has issued comprehensive guidelines advising and cautioning management staff and other relevant business associates on the procedure to be followed while dealing in equity shares of the Company and disclosure requirements in this regard. Company believes that "The Code of Internal Procedure and Conduct" and The Code of Corporate Disclosures PoliciesQ framed by it in this regard will help in ensuring compliance of the amended SEBI regulations.

39. ACKNOWLEDGMENT:

The Directors wish to convey their appreciation to the CompanyfJ shareholders, customers, suppliers, bankers and distributors for the support they have given to the Company and the confidence, which they have reposed in its management and the employees for the commitment and dedication shown by them.

For and on behalf of the Board

For AURO LABORATORIES LIMITED

SHARAT DEORAH

(DIN: 00230784) CHAIRMAN

 Registered Office: K-56, M.I.D.C. Industrial Area, Tarapur, Boisar, Thane - 401 506. 28th May. 2015