INCAP LIMITED

BOARD OF DIRECTORS
8
Sri.C.Bhagavantha Rao (DIN:00218713) Managing Director
Smt. C.Neelima (DIN:02737481) Whole-time Director
Sri.P.Ram Rao (DIN:00137511) Director
Smt. P.Himabindu (DIN:06605646) Director

AUDITORS BANKERS
M/s.K.V.V. Prasad & Co., State Bank of India,
Chartered Accountants, Patamata SME Branch,
D.No.29-13-71, 2nd Floor Vijayawada – 520007,
Kaleswara Rao Road Andhra Pradesh.
Suryaraopet,
Vijayawada -520002

REGISTERED OFFICE & FACTORY REGISTRARS & SHARE TRANSFER

AGENTS (PHYSICAL & DEMAT)
INCAP LIMITED
CIN:L32101AP1990PLC011311
Registered Office M/s.Venture Capital & Corporate
1-58, Nidamanuru, Investments Private Limited,
VIJAYAWADA – 521104 12-10-167, Bharat Nagar,
Krishna District, HYDERABAD – 500018.
Andhra Pradesh. Telangana.

Tel : 91-866-2842479, 2571, 1147 Tel : 91-40-23818475, 8476

Fax : 91-866-2842572 Fax : 91-40-23868024
Email : [email protected] Email : [email protected]

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URL : www.incaplimited.in

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INCAP LIMITED
NOTICE

Notice is hereby given that the TWENTY

EIGHTH ANNUAL GENERAL MEETING
8
thereof for the time being in force) M/s. K.
Anuradha & Associates, Chartered Accountants,
(Firms Registration No. 017328S), be and are
hereby appointed as Statutory Auditors of the
of M/s. INCAP LIMITED
Company to fill the casual vacancy caused by the
(CIN:L32101AP1990 PLC011311) will be held
resignation of M/s. K.V.V. Prasad & Co.,
on Saturday, the 29thSeptember, 2018 at 12.00
Chartered Accountants, (Firm Registration No:
Noon at the Registered Office of the company at
002758S).
1-58, Nidamanuru, Vijayawada – 521104, Krishna
District, Andhra Pradesh to transact the following “RESOLVED FURTHER that M/s. K. Anuradha
business : & Associates, Chartered Accountants, (Firms
Registration No. 017328S), be and are hereby
appointed as Statutory Auditors of the Company
ORDINARY BUSINESS:
to hold the office from 25th August, 2018, until
1. To consider and adopt the Audited Financial the conclusion of this Annual General Meeting
Statements of the Company for the financial year (28th) of the Company, at such remuneration plus
ended 31st March, 2018 and the Reports of the applicable taxes, and out of pocket expenses, as
Board of Directors and Auditors thereon. may be determined and recommended by the
Audit Committee in consultation with the
2. To appoint a Director in place of Sri P.Ram Rao Auditors and duly approved by the Managing
(DIN:00137511) who retires at this meeting and Director of the Company.”
being eligible offers himself for re-appointment.
5. Appointment of Statutory Auditors:
3. To declare dividend for the year 2017-2018.
To consider and if thought fit, to pass, with or
SPECIAL BUSINESS: without modification(s), the following Resolution
4. Appointment of Statutory Auditor to fill casual as an Ordinary Resolution:
vacancy: “RESOLVED that pursuant to Section 139 of the
To consider and if thought fit, to pass, with or Companies Act, 2013 read with the Companies
without modification(s), the following Resolution (Audit and Auditors) Rules, 2014 and other
as an Ordinary Resolution: applicable provisions, if any, (including any
statutory modification(s), clarifications,
“RESOLVED that pursuant to the provisions of exemptions or re-enactments thereof for the time
Section 139(8) of the Companies Act, 2013 read being in force) M/s. K. Anuradha & Associates,

8
with the Companies (Audit and Auditors) Rules, Chartered Accountants, (Firms Registration No.
2014 and other applicable provisions, if any, 017328S), be and are hereby appointed as
(including any statutory modification(s), Statutory Auditors of the Company to hold office
clarifications, exemptions or re-enactments for a period of three years, from the conclusion

2
INCAP LIMITED
of the 28 th Annual General Meeting till the
conclusion of the 31st Annual General Meeting
of the Company, at such remuneration plus
8
applicable taxes and out of pocket expenses, as
may be determined and recommended by the
Audit Committee in consultation with the
Auditors and duly approved by the Managing
Director of the Company.

For INCAP LIMITED

C.BHAGAVANTHA RAO
MANAGING DIRECTOR
DIN: 00218713

VIJAYAWADA
25th August, 2018

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3
INCAP LIMITED
NOTES :
1. A MEMBER ENTITLED TO ATTEND AND
VOTE IS ENTITLED TO APPOINT A 7.
8
transferred to the Investor Education and
protection fund.
The Notice of the AGM along with the Annual
PROXY TO ATTEND AND VOTE Report 2017-2018 is being sent by electronic
INSTEAD OF HIM/HERSELF AND A mode to those Members whose e-mail
PROXY NEED NOT BE A MEMBER. addresses are registered with the Company /
Depositories, unless any Member has
2. The proxy form duly completed must reach requested for a physical copy of the same.
the Registered Office of the Company not For members who have not registered their
later than forty-eight hours before the time e-mail addresses, physical copies are being
appointed for holding the meeting. sent by the permitted mode. A copy of the
notice of the AGM along with the Annual
3. Pursuant to the provision of section 105 of
Report is also available for download on the
the Companies Act, 2013, a person can act as
website of the company www.incaplimited.in.
a proxy on behalf of not more than fifty
To support the ‘Green Initiative’ Members
members and holding in aggregate not more
who have not registered their e-mail addresses
than ten percent of the total share capital of
are requested to register the same with link
the company. Members holding more than
in time/Depositories.
ten percent of the total share capital of the
company may appoint a single person as 8. Relevant documents/agreements referred to
proxy, who shall not act as a proxy for any in the accompanying Notice and the
other Member. Proxies submitted on behalf Explanatory Statement are open for
of limited companies, societies, etc., must be inspection by the members at the Registered
supported by an appropriate resolution/ Office of the Company on all working days,
authority, as applicable. except Saturdays, during the business hours
upto the date of the meeting.
4. The Register of Members and Share Transfer
books of the company will remain closed 9. In case of Joint Holders attending the
from 22nd September, 2018 to 25 th meeting, the member whose name appears
September, 2018 (Both days inclusive) for the as the first holder in the order of names as
purpose of Annual General Body meeting for per Register of members will be entitled to
the year ended 31st March, 2018. vote.
10. Corporate members intending to send their
5. The dividend if any declared at this meeting
authorized representative to attend the
will be paid to those members, whose names
Meeting are requested to send to the company
appear in the Register of Members of the
a certified copy of the Board resolution
company as on 21stSeptember, 2018.
authorizing their representative to attend and
6. Unclimed Dividend : Dividends unclaimed vote on their behalf at the Meeting.
and unpaid over 7 years will be transferred 11. Members / proxies should bring the

8 to the investor Education and Protection

Fund. Further, Shares of Such shareholders.
who have not encashed any dividend warrant/
attendance slips duly filled in for attending
the meeting.

instrument during the last 7 years, will be 12. Voting Through Electronic Means:-

4
INCAP LIMITED
(i) In accordance with applicable provisions of
the Listing Agreement and Companies Act,
2013, read with Companies (Management
and Administration) Rules, 2014 (the Rules),
manner. 8
e-voting process in a fair and transparent

(vi) The procedure and instructions for e-voting

are as under
the company is pleased to provide facility to
its members, to cast their vote electronically a) The shareholders should log on to the
for all the resolutions proposed at the 28th e-voting website www.evotingindia.com.
Annual General Meeting of the company the b) Click on Shareholders.
company has appointed Central Depository
c) Now enter your User ID
Services (India) Ltd. (CDSL) to provide e-
voting facility to its members. d) For CDSL 16 digits beneficiary ID.
e) Members holding shares in physical form
(ii) The voting right of shareholders shall be in
should enter Folio Number registered with
proportion to one vote per full paid equity
the company.
share of the company held by them as on the
f) Next enter the image verification as
cutoff date 21stSeptember, 2018.
displayed and click on Login.
(iii)The remote e-voting period beings on
g) If you are holding shares in demat form
Wednesday, September 26, 2018 at 09:00 and had logged on to
hours (IST) and ends at on Friday, September www.evotingindia.com and voted on an
28, 2018 at 17:00 hours (IST). During this earlier voting of any company, then your
period share holders’ of the Company, holding existing password is to be used.
share either in physical form or in
h) If you are a first time user following the
dematerialized form, as on the cut-off date
steps given below:
of September 21, 2018, may cast their vote
electronically. The remove e-voting module For Members holding share in Physical Form
shall be disabled by CDSL for voting For Members holding share sin Demat Form
thereafter. PAN *Enter your 10 digit alpha-numeric
(iv) The facility for voting by ballot or polling *PAN issued by Income Tax Department
paper shall also be made available at the (Applicable for both demat shareholders as
meeting and Members of the Company as of well as physical share holders)
cutoff date, attending the meeting who have - Members who have not updated their PAN
not already cast their vote by remove e-voting with the Company / Depository
shall be able to exercise their right at the participant are requested to use the first
meeting. The Members who have cast their two letters of their name and the 8 digits
vote by remote e-voting prior to the meeting of the sequence number in the PAN field.
may also attend the meeting but shall not be
entitled to cast their vote again. - In case the sequence number is less than
8 digits enter the applicable number of
(v) M/s. B.L.Chandrasekhar Sarma & Associates, 0’s before the number after the first two

8 Practicing Company Secretaries has been

appointed by the Board of Directors of the
company, as the Scrutinizer to scrutinize the
characters of the name in CAPITAL
letters. Eg. If your name is Ramesh
Kumar with sequence number 1 then enter
RA00000001 in the PAN field.

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INCAP LIMITED

demat account or in the company records for

the said demat account or folio in dd/mm/
yyyy format.
8
DOB # Enter the date of birth as recorded in your vii. After selection the resolution you have
decided to vote on, click on “SUBMIT”. A
confirmation box will be displayed. If you
wish to confirm your vote, click on “OK”,
Dividend Bank Details # Enter the else to change your vote, click on “CANCEL”
Dividend bank details as recorded in your and accordingly modify your vote.
demat account bank or in the company
viii. Once you “CONFIRM” you vote on the
records for the said demat account or folio.
resolution, you will not be allowed to modify
i. After entering these details appropriately, your vote.
click on “SUBMIT” tab.
ix. You can also take out print of the voting done
ii. Members holding shares in physical form will by you by clicking on “Click here to print”
then directly reach the company selection option on the voting page.
screen. However, members holding shares
x. If demat account holder has forgotten the
in demat form will now reach ‘Password
same password then Enter the User ID and
Creation’ menu wherein they are required to
the image verification code and click on
mandatorily enter their login password in the
Forgot password & enter the details as
new password field. Kindly note that this
prompted by the system.
password is to be also used by the demat
holders for voting for resolutions of any other xi. Note for Non-Individual shareholders and
company on which they are eligible to vote, custodians.
provided that company opts for e-voting Non-individual shareholders (i.e. other than
through CDSL platform. It is strongly individuals, HUF, NRI etc.) and custodian are
recommended not to share your password required to log on to www.evotingindia.com
with any other person and take utmost care and register themselves as Corprates.
to keep your password confidential. A scanned copy of the registration form
iii. For Members holding shares in physical form, bearing the stamp and sign of the entity
the details can be used only for e-voting on should be emailed to
the resolutions contained in this Notice. [email protected].
iv. Click on the EVSN for the relevant <INCAP After receiving the login details a compliance
LIMITED> to vote. user should be created using the admin login
and password. The compliance user would
v. On the voting page, you will see
be able to link the account(s) for which they
“RESOLUTION DESCRIPTION” and
wise to vote on.
against the same the option “YES / NO” for
voting. Select the option YES or NO as The list of accounts should be mailed to
desired. The option YES implies that you [email protected] and on
assent to the resolution and option NO implies approval of the accounts they would be able

8
that you dissent to the resolution. to cast their vote.
vi. Click on the “RESOLUTIONS FILE LINK” A scanned copy of the Board resolution and
if you wish to view the entire resolution power of attorney (POA) which they have
details. issued in favour of the custodian, if any,

6
INCAP LIMITED
should be uploaded in PDF format in the
system for the scrutinizer to verify the same. countersign the same.
xii. In case you have any queries or issued xiv. The results declared along with the
8
person authorized by him in writing who shall

regarding e-voting, you may refer the scrutinizer’s report shall be placed on the
frequently asked questions (“FAQs”) and e- company’s website www.incaplimited.ins
voting manual available at and on the website of CDSL
www.evotingindia.com, under help section or www.evotingindia.com. Immediately after
write an email to helpdesk.evoting the result is declared. The company shall
@cdslindia.com simultaneously forward the results to BSE
Limited (“BSE”) where the shares of the
xiii. The Scrutinizer shall, immediately after the
company are listed.
conclusion of voting at the general meeting,
would count the votes cast at the meeting, By order of the Board
thereafter unblock the votes cast through For INCAP LIMITED
remote e-voting in the presence of at least
two witness not in the employment of the
company and make, not later than three days
of conclusion of the meeting, a consolidated C.BHAGAVANTHA RAO
scrutinizer’s report of the total votes cast in VIJAYAWADA MANAGING DIRECTOR
th
favour or against, if any to the chairman or a 26 May, 2018 DIN: 00218713

8
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INCAP LIMITED

Details of Directors seeking appointment/ re-appointment at the AGM

[Pursuant to Regulations 26(4) and 36(3) of the Listing Regulations
and Secretarial Standards - 2 on General Meetings
8
Particulars P. Ram Rao

Director Identification Number (DIN) 00137511

Date of Birth 28-06-1948

Date of first appointment 16-12-1991

Qualification B.E.(Hons)

Expertise in specific functional areas Electrical, Electronic Industry

and Administration

Terms and conditions of appointment/ Appointed as Non-Executive

re-appointment Director liable to retire by rotation

No. of Board Meetings attended during the year 3

Details of remuneration last drawn (2017-18) Nil

No. of shares held in the Company:

(a) Own 510933 Equity Shares
(b) For other persons on a beneficial basis --

Directorships held in other public

companies (excluding foreign and - Nil -
private companies)

Memberships/Chairmanships of Audit
Committees and Investors’ Grievance - Nil -
Committees across public companies

Shareholding 9.95% (5,10,933 Equity shares)

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8
INCAP LIMITED
EXPLANATORY STATEMENT FOR THE PROPOSED RESOLUTION
PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013
8
Item No.4 &5:

M/s. K.V.V. Prasad & Co., Chartered Accountants, (Firm Registration No: 002758S), the previous
Statutory Auditors has tendered their resignation mentioning pre – occupancy with other professional
assignments, on 25th August, 2018. In order to fill up such casual vacancy, the Board has proposed
to appoint M/s. K. Anuradha & Associates, Chartered Accountants, (Firms Registration No. 017328S).,
Chartered Accountants in their place. In pursuance to the provisions of Section 139(8) of the
Companies Act, 2013, the company needs to approve the appointment of /s. K. Anuradha & Associates,
Chartered Accountants, (Firms Registration No. 017328S), in the General Meeting of the Company
within 3 (three) months from the date of appointment by the Board. Hence, the Board has proposed
to seek the members in this annual general meeting.

Your directors recommend the resolution for approval of the shareholders by way of Ordinary
Resolution.

None of the other Directors or Key Managerial Personnel of the Company and their respective relatives
is, in any way, concerned or interested, financially or otherwise, in the proposed resolution.

By order of the Board

For INCAP LIMITED

C.BHAGAVANTHA RAO
MANAGING DIRECTOR
DIN: 00218713

VIJAYAWADA
25th August, 2018

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INCAP LIMITED

ROUTE MAP 8

8
10
INCAP LIMITED

To
The Members,
DIRECTORS’ REPORT
8
Incap Limited
CIN:L32101AP1990PLC011311

Your Directors have pleasure in presenting the Twenty Eighth Annual Report on the business and
operations of the company and the Audited Financial Accounts for the year ended 31st March, 2018
together with Auditors’ Report thereon.
1. FINANCIAL RESULTS :
The financial results for the year ended 31st March, 2018 are summarized below:

PARTICULARS 2017 - 2018 2016 - 2017

Revenue from Operations 2836.79 2857.04
Other Income 105.09 38.29
Total Income 2941.88 2895.33
Total Expenditure 2502.17 2468.99
Profit before Interest, Depn. & Tax 439.71 426.34
Interest 13.43 41.44
Profit before Depn. & Tax 426.28 384.90
Depreciation 36.93 29.74
Profit before Tax 389.35 355.16
Add : Deferred Tax Liability (Net ) 4.02 -7.47
Provision for Tax 108.50 111.98
Profit after Tax 284.87 235.71
Add : Brought forward from previous year 531.07 357.14
815.94 592.85
Appropriations
Provision for Dividend 51.33 51.33
Tax on Dividend 10.45 10.45
Surplus carried to Balance Sheet 754.16 531.07
2. STATE OF COMPANY AFFAIRS :
During the year 2017-2018 your company achieved a turnover or Rs.2836.79 Lakhs against
Rs.2857.04 Lakhs for the year 2016-2017 your company made a net profit of Rs.284.87 Lakhs
during the year.

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3. EVENTS SUBSEQUENT TO THE DATE OF FINANICAL STATEMENTS :
There are no material changes and commitments affecting financial position of the company
between 31st March, 2018 and the date of Board’s Report.

11
INCAP LIMITED
4. EXTRACT OF ANNUAL RETURN :
8
As required pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the companies
(Management and Administration) Rules, 2014, an extract of annual return in MGT9 is enclosed
as Annexure “A” to this report.
5. INFORMATION ABOUT THE FINANCIAL PERFORMANCE / FINANCIAL
POSITION OF THE SUBSIDIARIES / ASSOCIATES / JV :
The company does not have any subsidiary, joint venture or associates company.
6. DIVIDEND :
The Board of Directors recommended for your consideration a dividend on equity share at 10%
(Re.1.00 per equity share) for the year ended 31stMarch, 2018. The total amounts of outgo on
account of these will Rs.51.33 Lakhs towards dividend and Rs.10.45 Lakhs towards tax on
dividend.
7. DIRECTORS :
Sri.P.Ram Rao having DIN : 00137511, retires by rotation at the ensuring Annual General
Meeting and being eligible offers himself for re-appointment.
Attention of the members is invited to the relevant items in the Notice of the Annual General
meeting and the Explanatory statement thereto.
8. DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS :
The company has not appointed Independent Directors and receiving declaration from
Independent Directors won’t arise. The company is taking necessary steps to appoint Independent
Directors.
9. POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION :
For the purpose of selection of any Director, the Nomination & Remuneration Committee
identifies persons of integrity who possess relevant expertise, experience and leadership qualities
required for the position and also takes into consideration recommendation, if any, received
from any member of the Board. The committee also ensures that the incumbent fulfills such
other criteria with regard to age and other qualifications as laid down under the Companies Act,
2013 or other applicable laws. The Board has, on the recommendation of the Nomination &
Remuneration committee framed a policy for selection, appointment and remuneration of
Directors & Senior Management.
10. EVALUATION OF PERFORMANCE OF THE BOARD, ITS COMMITTEES AND
INDIVIDUAL DIRECTORS :
The Board of Directors have carried out an annual evaluation of its own performance, its various
committees and individual directors pursuant to the provisions of the Act and the Corporate
Governance requirements as prescribed under the Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015 ( Listing Regulations).
The performance of the Board was evaluated by the Board after seeking inputs from all the

8 directors on the basis of various criteria such as Board composition, process, dynamics, quality
of deliberations, strategic discussions, and effective reviews, committee participation, governance
reviews etc.

12
INCAP LIMITED
The Board and the Nomination and Remuneration committee reviewed the performance of the
8
individual directors on the basis of the criteria such as Transparency, Analytical Capabilities,
Performance, Leadership, Ethics and ability to take balanced decisions regarding stakeholders.
11. TRANSFER TO RESERVES :
No amount was transferred to the reserves during the financial year ended 31st March, 2018.
12. NUMBER OF MEETINGS OF THE BOARD :
The Board of Directors met 4(Four) times on 29thMay, 2017, 27th July, 2017, 31stOctober, 2017
and 9th February, 2018 dates during the financial year.

Number of meetings attended / total meeting held

Name of the Director
during the Financial Year 2017-2018

Sri C.Bhagavantha Rao 4/4

Sri P.Ram Rao 3/4
Smt. C.Neelima 4/4
Smt. P.Himabindu 3/4

13. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE

(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
Your company strongly believes in providing a safe and harassment free workplace for each
and every individual working for the company through various interventions and practices. It is
the continuous endeavor of the management of the company to create and provide an environment
to all its employees that is free from discrimination and harassment including sexual harassment.
During the year ended 31st March, 2018, no complaints pertaining to sexual harassment was
received by the Company.
14. STATUTORY AUDITORS :
M/s. K.V.V. Prasad & Co., Chartered Accountants, (Firm Registration No: 002758S), previous Statutory
Auditors, has submitted their resignation mentioning health issues and pre-occupations, Your Board of
Directors propose to appoint M/s. K. Anuradha & Associates, Chartered Accountants, (Firms Registration
No. 017328S) as statutory auditors of the Company for a period of 3 Years.
15. SECRETARIAL AUDITORS :
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors has appointed
M/s.A.N.Sarma & Co., Company Secretaries for conducting secretarial audit of the Company

8
for the financial year 2017-2018. The Secretarial Audit Report (Form MR-3) is enclosed
Annexure “C”to this report. The remarks, qualification and reservation of Secretarial Auditor
have been mentioned in the report and the reasons for not appointing Independent Directors and
Company Secretary of the company is explained as follows.

13
INCAP LIMITED
a.
8
Company is engaged in a business where it finds difficult to find Independent Directors who
can understand and provide value addition to the Company. And also, the company’s registered
office and factory is located in a rural area of new capital of Andhra Pradesh and it is finding
difficult not only to appoint Independent directors and Company Secretary but also other
resources.
b. Company undertakes to appoint Independent Directors and Company Secretary of the Company
to comply with all provisions of the Companies Act, 2013 and Listing Agreement.
16. LOANS, GUARANTEES & INVESTMENTS :
The Company has not given loans, guarantees, securities and made investments during the year
under review, under the provisions of the Companies Act, 2013 as the rules framed thereunder.
17. RELATED PARTY TRANSACTIONS :
There are no related party transactions made by the company with its promoters, directors or
the management, their relative conflicting with company’s interest during the year under review,
under the provision of the Companies Act, 2013 and the rules framed thereunder.
18. COMPOSITION OF AUIDT COMMITTEE :
The details pertaining to composition of Audit Committee are included in the Corporate
Governance Report which forms a part of this report.
19. RISK MANAGEMENT POLICY :
The company has developed and implemented a risk management policy which identifies major
risks which may threaten the existence of the company. The same has also been adopted by
your Board and is also subject to its review from time to time.
20. INTERNAL FINANCIAL CONTROLS :
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 in the Internal
AuditManual. To maintain its objectivity and independence, the Internal Audit function reports
to the Chairman of the Audit Committee of the Board and 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 at all locations of the Company.
Based on the report of internal audit function, process owners undertake corrective action in
their respective areas and thereby strengthen the controls. Significant audit observations and
recommendations along with corrective actions thereon are presented to the Audit Committee
of the Board.

8
21. CORPORATE SOCIAL RESPONSIBILITY :
The provisions of Corporate Social Responsibility are not applicable to the Company under the
provisions of the Companies Act, 2013

14
INCAP LIMITED
22. PUBLIC DEPOSITS :
8
The Company has not accepted any deposit from the Public during the year under review, under
the provisions of the Companies Act, 2013 and the rules framed thereunder.
23. VIGIL MECHANISM :
Pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013 and as per the
Securities and Exchange Board of India (Listing Obligations and Disclosure requirements)
Regulations, 2015 (Listing Regulations), the Company has vigilance Mechanism comprising of
Executive and Non Executive Promoter Directors.
24. CORPORATE GOVERNANCE REPORT :
Your company has taken adequate steps to adhere to all the stipulations laid down in Listing
Regulations. Report on Corporate Governance is enclosed as Annexure “D”to this Report.
Certificate from the Statutory Auditors of the company confirming the compliance with the
conditions of Corporate Governance as stipulated under the Securities and Exchange Board of
India (Listing Obligations and Disclosure requirements) Regulations, 2015 (‘ Listing Regulations)
is enclosed as Annexure “E”to this report.
25. MANAGEMENT DISCUSSIONS ANALYSIS :
The management discussion and analysis on the operation of the Company as prescribed under
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015 (Listing Regulations) is enclosed as Annexure “F” to this report.
26. DIRECTORS’ RESPONSIBILTY STATEMENT :
Pursuant to section 134 of the Act, the Directors, based on the representation received from the
Directory hereby confirm that:-
a) In the preparation of the annual accounts, the applicable accounting standards have been
followed and that there are no material departures;
b) They have, in the selection of the accounting policies, consulted the statutory auditors and
have 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 of the company for that period;
c) They have taken proper and sufficient care, to the best of their knowledge and ability, for the
maintenance of adequate accounting records in accordance with the provisions of the Act, for
safeguarding the assets of the company and for preventing and detecting fraud and other
regulations.
d) They have prepared the annual accounts on a going concern basis.

8
e) 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.
f) The directors had devised proper systems to ensure compliance with the provision of all applicable
laws and that such systems were adequate and operating effectively.

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INCAP LIMITED
27. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN

a.
EXCHANGE OUTGO :
Conversation of Energy :
8
(i) The steps taken or impact on The Company does not belong to the category
conservation of energy of power intensive
industries and hence consumption of power is
not significant. However the management is
aware of importance of conservation of energy
and also reviews from time to time the measures
taken/ to be taken for reduction of consumption
of energy. Your company continues its efforts
to conserve energy wherever practicable by
economizing on the use of power through better
utilization of equipment and proper production
planning.

(ii) The steps taken by the NIL

company for utilizing alternate
sources of energy
(iii) The capital investment NIL
on energy conservation equipment’s
b. Technology Absorption :
(i) The efforts made towards technology Company is not based on any technology,
absorption hence technological absorption don’t arise.
(ii) The benefits derived like product NIL
improvement, cost reduction, product
development or import substitution
(iii) In case of imported technology Company has not imported Foreign
(imported during the last three years Technology
reckoned from the beginning of the
financial year)
(a)The details of technology imported NIL
(b) The year of import NIL
(c) whether the technology been

8 fully absorbed
(d) if not fully absorbed, areas where
absorption has not taken place,
and the reasons thereof
NIL
NIL

16
INCAP LIMITED
(iv) The expenditure incurred on
research and development
NIL
8
c. Foreign exchange earnings and outgo : (Rs. in Lakhs)
Particulars Current Year Previous Year
a) Foreign exchange earnings on Exports NIL NIL
b) Foreign exchange used on account of
value of imports
i) Raw Materials & Stores 1529.99 1302.45
ii) Capital Goods 6.83 24.88
iii) Foreign Travel 5.30 14.36

28. SIGINIFICANT & MATERIAL ORDERS PASSED BY THE REGULATIONS :

No significant and material orders passed by the regulators or Courts or Tribunals impacting the
going concern status and the company’s operations in future.
29. RATIOS OF REMUNERATION TO EACH DIRECTOR :
Details / Disclosures of Ratio of Remuneration to each Director to the median employee’s
remuneration to this Annual Report :–

Remuneration Paid Increase in Ratio/Times per

Name Designation
Remuneration from Median of Emp.
2017-18 2016-17 previous year Remuneration
Sri C.Bhagavantha Rao Managing 24.00 14.00 Yes 28.33 Times
Director
Whole time 16.00 9.60 Yes 21.25 Times
Smt C.Neelima
Director

30. QUALITY SYSTEM :

Your company’s certificate for quality systems under ISO 9001:2015 from APTS Quality
Certification, Hyderabad continues to be valid.

31. DISCLOSURE AS PER LISTING AGREEMENT :

8 Clause 32 :
The cash flow statement in accordance with Accounting Standard and Cash Flow Statement
(AS3) issued by ICAI is appended to this Annual Report.

17
INCAP LIMITED
Clause 43A :
8
The company’s shares are listed on Bombay Stock Exchange Limited, Floor 25, P.J. Towers,
Dalal Street, Mumbai – 400001. The annual listing fee to BSE Limited for the year 2017-2018
has been paid.
32. PARTICUALRS OF EMPLOYEES :

Information as per section 197 (12) of the companies Act, 2013, read with rule 5 of the companies
(Appointment and Remuneration of Managerial Personnel) Rules 2014 is provided in separate
annexure forming part of this report. Further, pursuant to the provision to section 136 (1) of the
companies Act, 2013, the report and the accounts are being sent to the members excluding the
aforesaid annexure. In terms of section 136 of the Act, the said annexure is open for inspection
at the Registered Office of the company. Any shareholder interested in obtaining a copy of the
same may write to the registered office address of the company.
There are no employees drawing remuneration as prescribed in companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014.
33. ACKNOWLEDGEMENTS :

Your Directors wish to express their grateful appreciation for the assistance and cooperation
received from State Bank of India, Customers and Suppliers. Cordial relations prevailed during
the year with all the employees. Your Directors wish to place on record their deep sense of
appreciation of the valuable work done and cooperation extended by them at all levels.
Yours directors also wish to express their gratitude to investors for the continued faith reposed
by them in the company.

By order of the Board

For INCAP LIMITED
VIJAYAWADA
26th May, 2018
C.BHAGAVANTHA RAO
MANAGING DIRECTOR
DIN: 00218713

8
18
INCAP LIMITED
ANNEXURE – A
FORM NO. MGT 9
EXTRACT OF ANNUAL RETURN
8
As on financial year ended on 31.03.2018
Pursuant to Section 92 (3) of the Companies Act, 2013 and rule 12(1) of the Company
(Management & Administration) Rules, 2014.

I. REGISTRATION & OTHER DETAILS:

1 CIN : L32101AP1990PLC011311
2 Registration Date : 21/05/1990
3 Name of the Company : INCAP LIMITED
4 Category/Sub-category of the : PUBLIC COMPANY
Company
5 Address of the Registered office : 1-58, Nidamanuru, Vijayawada - 521104.
& contact details Email : [email protected];
Tel : 0866-2842479; 2842571
6 Whether listed company : Yes
7 Name, Address & contact details of the : M/s. Venture Capital & Corporate Investments Private
Registrar & Transfer Agent, if any. Limited, 12-10-167, Bharat Nagar, Hyderabad - 500018
Email : [email protected]; Tel : 040-23818475; 23818476

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY:

(All the business activities contributing 10% or more of the total turnover of the
company shall be stated)
Name and description of the main NIC code of the % to total turnover of
S.No. company
products / services Product/service
1. Aluminium Electrolytic Capacitors 26101 67.57%

2 Other - (Inland transportation and

port clearance for power grid) - 32.43%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATES COMPANIES:

Name and address of the CIN/GLN Holding/ Subsidiary/ % of Applicable

8
SN
Company Associate Shares Section
held
1 NIL NIL NIL NIL NIL

19
INCAP LIMITED
IV. SHARE HOLDING PATTERN : (Equity share capital breakup as percentage of Total Equity)

Category of
(i) Category-wise shareholding :
No. of shares held at the begining No. of shares held at the end
8
of the year(As on 31-03-2017) of the year(As on 31-03-2018) %Change
Shareholders during
Demat Physical Total % of Total Demat Physical Total %of Total the year
Shares Shares
A. Promoter
1) Indian
a) Individual/ HUF 32,82,491 4,80,000 37,62,491 73,30% 32,82,491 4,80,000 37,62,491 73,30% -
b) Central Govt - 0.00% 0.00%
c) State Govt(s) - 0.00% 0.00%
d) Bodies Corp - 0.00% 0.00%
e) Banks / FI - 0.00% 0.00%
f) Any Other - 0.00% 0.00%
Sub-total(A)(1):- 32,82,491 4,80,000 37,62,491 73,30% 32,82,491 4,80,000 37,62,491 73,30% 0.00%
2) Foreign
a) NRI Individuals - 0.00% 0.00%
b) Other-Individuals - 0.00% 0.00%
c) Bodies Corp. - 0.00% 0.00%
d) Any Other…. - 0.00% 0.00%
Sub-total(A)(2):- - - - 0.00% 0.00%
Total (A) 32,82,491 4,80,000 37,62,491 73,30% 32,82,491 4,80,000 37,62,491 73,30% 0.00%

B. Public Shareholding
1. Institutions
a) Mutual Funds 100 100 0.00% 100 100 0.00 0.00%
b) Banks / FI - 0.00% 0.00%
c) Central Govt - 0.00% 0.00%
d) State Govt(s) - 0.00% 0.00%
e) Venture Capital Funds - 0.00% 0.00%
f) Insurance Companies - 0.00% 0.00%
g) FIIs - 0.00% 0.00%
h) Foreign Venture Capital Funds - 0.00% 0.00%
i) Others (specify) - 0.00% 0.00%
Sub-total (B)(1) 100 - 100 0.00% 100 100 0.00%

2. Non Institutions
a) Bodies Corp.
(i) Indian 39,519 6000 45,519 0.89% 41,613 41,613 0.81% -8.58%
(ii) Overseas 0.00% 0.00%
b) Individuals
(i) Individual shareholders
holding nominal share 7,58,509 2,73,940 10,32,449 20,11% 7,29,730 1,58,540 8,88,270 17,30% -13.96%
capital upto Rs. 1 lakh
(ii) Individual shareholders
holding nominal share 68,828 24,600 93,428 1.82% 1,11,146 24,600 1,35,746 2.64% 45.29%
capital in excess of Rs 1 lakh

8 c) Other (specify)
Non Resident Indians
Overseas Corporate Bodies
Foreign Nationals
Clearing Members
1,91,382

7,731
1,91,382
-
-
7,731
3.73%
0.00%
0.00%
0.15%
1,93,765

3,173
1,93,765

3,173
3.77%

0.06%
1.25%
0.00%
0.00%
257.26%

20
INCAP LIMITED

Category of
Shareholders
No. of shares held at the begining
of the year(As on 31-03-2016)
Demat Physical Total % of Total Demat
No. of shares held at the end
of the year(As on 31-03-2017)
Physical Total %of Total
8 %Change
during
the year

Shares Shares
Trusts 100 100 0.00% 100 100 0.00% 0.00%
IEPF - - 0.00% 1,07,942 1,07942 2.10% 0.00%
Sub-total(B)(2) 10,66,069 3,04,540 13,70,609 26,70% 11,87,469 1,83,140 13,70,609 26.70% 0.00%
Total Public 10,66,169 3,04,540 13,70,709 26,70% 11,87,569 1,83,140 13,70,709 26.70% 0.00%
C. Shares held by
Custodian for GDRs & 0.00% 0.00%
ADRs
GrandTotal (A+B+C) 43,48,660 7,84,540 51,33,200 100.00% 44,70,060 6,63,140 51,33,200 100.00% 0.00%

ii.) Shareholding of promoters :

Shareholding at the
Shareholding at the beginning Shareholding at the end
S.No. beginning of the year
% of Shares Pledged/ of the year of the year % change in
encumbered to total shares shareholding
% of shares % of shares during the year
% of total % of total
No. of pledged/ No. of pledged/
shares of the shares of the
Shares encumbered to Shares en-cumbered to
company company
total shares total shares
1. Sri C.Bhagavantha Rao 10,23,707 19.94% - 10,23,707 19.94% - 0.00%
2. Smt. C. Neelima 12,11,407 23.60% - 12,11,407 23.60% - 0.00%
3. Sri P.Ram Rao 5,10,933 9.95% - 5,10,933 9.95% - 0.00%
4. Smt. P.Himabindu 6,48,399 12.63% - 6,48,399 12.63% - 0.00%
5. Smt. C. Lalitha Kumari 3,68,045 7.17% - 3,68,045 7.17% - 0.00%
Total 37,62,491 73.30% 37,62,491 73.30% 0.00%

iii.) Change in promoters' Shareholding (please specify, if there is no change)

SN Particulars Date Reason Shareholding at the Cumulative Shareholding

beginning of the year during the year
% of total % of total
No. of Shares No. of Shares
shares shares

At The beginning of the year 01/04/2017 37,62,491 73.30% 37.62,491 73.30%

Changes during year - - - -
At the end of the year 31/03/2018 37,62,491 73.30% 37.62,491 73.30%

(iv) Shareholding Pattern of top ten Shareholders

(Other than Directors, Promoters and Holders of GDRs and ADRs):

SN For each of the 10 Date

Reas Shareholding at the Cumulative Shareholding
shareholders on beginning of the year during the year
% of total % of total
No. of Shares shares No. of Shares shares

8 1. Name
At The beginning of the year
Changes during year
At the end of the year
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%

21
INCAP LIMITED
(V) Shareholding of Directors and Key Managerial Personnel:

SN Shareholding of each
Directors and each Key
Managerial Personnel
Date Reason
Shareholding at the
beginning of the year
% of total
during the year
8
Cumulative Shareholding

% of total
No. of Shares shares No. of Shares shares
1. Name
At The beginning of the year 01/04/2017 37,62,491 73.30% 37,62,491 73.30%
Changes during year - - - -
At the end of the year 31/03/2018 37,62,491 73.30% 37,62,491 73.30%

(V) INDEBTEDNESS
Indebtedness of the Company including interest outstanding/accrued but not due for payment.
(Rs. in Lakhs)
Secured loans Unsecured Total indebtedness
Particulars Deposits
excluding depsoits Loans

Indebtedness at the beginning of the Financial Year

i) Principal Amount 6.91 6.91
ii) Interest due but not paid -
iii) Interest accrued but not due -
Total (i+ii+iii) 6.91 6.91
Change in indebtedness during the financial year
* Addition 21.91 21.91
* Reduction
Net Change 21.91 21.91
Indebtedness at the end of the financial year
i) Principal Amount 28.82 28.82
ii) Interest due but not paid
iii) Interest accrued but not due
Total (i+ii+iii) 28.82 28.82

8
22
INCAP LIMITED
VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
A. Remuneration to Managing Director, Whole-time Directors and/or Manager:
Sl.No. Particulars of Remuneration Name of MD/WTD/Manager
8
Total Amount

Name C.Bhagavantha Rao C.Neelima (Rs/Lac)

Designation Managing Director Whole time Directore
1. Gross Salary
a) Salary as per provisions contained in
section 17(1) of the Income Tax Act, 1961 15,77,400.00 9,68,000.00 25,45,400.00
b) Value of perquisites u/s 17(2)
Income Tax Act, 1961 8,22,600.00 6,92.000.00 15,14,600.00
c) Profits in lieu of salary unders section
17(3) Income Tax Act, 1961 - - -
2. Stock Option - -
3. Sweat Equity - - -
4. Commission
- as % of profit
- other, specify - - -
5. Others, please specify
Total (A) 24,00.000.00 16,60.000.00 40.60.000.00
Ceiling as per the Act

B. Remuneration to other Directors :

SN Particulars of Remuneration Name of Directors Total
Amount
P. Himabindu P. Ram Rao (Rs/Lac)

1 Independent Directors
- Fee for attending Board -
Committee meetings
- Commission -
- Others, please specify -

Total (1) - - - -

2 Other Non-Executive Directors

- Fee for attending Board
Committee meetings 2,000.00 2,000.00 4,000.00
- Commission -
- Others, please specify -
Total (2) 2,000.00 2,000.00 - 4,000.00
Total B = (1+2) 2,000.00 2,000.00 - 4,000.00

8 Total Managerial Remuneration

Overall Ceiling as per the Act 40,64,000.00

23
INCAP LIMITED

C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD

S.No. Particulars of Remuneration Name of Key Managerial Personnel
8 Total
Amount
Name (Rs/Lac)
Designation CEO CFO CS
1. Gross Salary
a) Salary as per provisions contained in
section 17(1) of the Income Tax Act, 1961 -
b) Value of perquisites u/s 17(2) -
Income Tax Act, 1961
c) Profits in lieu of salary unders -
section 17(3) Income Tax Act, 1961
2. Stock Option -
3. Sweat Equity -
4. Commission -
- as % of profit -
- other, specify -
5. Others, please specify -
6. Total - - - -

VII. PENALTIES / PUNISHMENT / COMPOUNDING OF OFFENCES :

Section of the Details of Penalty/

Companies Punishment/ Authority (RD/ Appeal made, if any
Type Brief Description
Act Compounding fees NGLT/ COURT) (give Details)
imposed

A. COMPANY
Penalty - - - - -
Punishment - - - - -
Compounding - - - - -

B. DIRECTORS

Penalty - - - - -
Punishment - - - - -
Compounding - - - - -

C.Other Officer in Default

8Penalty
Punishment
Compounding
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-

24
INCAP LIMITED
ANNEXURE – B
INDEPENDENT AUDITOR’S REPORT

To the Members of INCAP Ltd, Nidamanuru

8
Report on the Standalone Financial Statements
We have audited the accompanying standalone Ind AS financial statements of INCAP Ltd.,
which comprise the Balance sheet as at 31st March, 2018, the Statement of Profit and Loss
(including other comprehensive income), the statement of Cash Flows and the statement of
changes in equity for the year then ended, and a summary of significant accounting policies and
other explanatory information (herein after referred to as “standalone Ind AS financial statements”).
Management’s Responsibility for the Standalone Financial Statements
The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the
Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone Ind.AS
financial statements that give a true and fair view of the financial position,, financial performance
including other comprehensive income, cash flows and changes in equity of the Company in
accordance with the Indian Accounting Standards (IND AS) prescribed under Section 133 of the
Companies Act, 2013 read with relevant rules issued there under and other accounting principles
generally accepted in India. This responsibility also includes maintenance of adequate accounting
records in accordance with the provisions of the Act for safeguarding of the assets of the company
and for preventing and detecting the frauds and other irregularities; selection and application of
appropriate accounting policies; making judgments and estimates that are reasonable and
prudent; and design, implementation and maintenance of adequate internal financial controls,
that were operating effectively for ensuring the accuracy and completeness of the accounting
records, relevant to the preparation and presentation of standalone Ind. AS financial statements
that give a true and fair view and are free from material misstatement, whether due to fraud or
error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these standalone Ind AS financial statements
based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the provisions of the Act and
the Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing specified under Section
143(10) of the Act. Those standards require that we comply with ethical requirements and plan
and perform the audit to obtain reasonable assurance about whether the Standalone Ind AS

8
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the
disclosures in the standalone Ind AS financial statements. The procedures selected depend on
the auditor’s judgment, including the assessment of the risks of material misstatement of the
standalone Ind AS financial statements, whether due to fraud or error. In making those risk
25
INCAP LIMITED

8
assessments, the auditor considers internal financial control relevant to the Company’s preparation
of standalone Ind AS financial statements that give a true and fair view in order to design audit
procedures that are appropriate in the circumstances. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness of the accounting
estimates made by the Company’s Directors, as well as evaluating the overall presentation of
the standalone Ind AS financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our audit opinion on the standaloneInd AS financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us,
the aforesaid standalone Ind AS financial statements give the information required by the Act in
the manner so required and give a true and fair view in conformity with the accounting principles
generally accepted in India including the Ind AS, of the financial position of the Company as at
31st March, 2018, and its financial performance including other comprehensive income, its cash
flows and changes in equity for the year ended on that date.
Other Matter
The comparative financial information of the Company for the year ended 31st March, 2017
prepared in accordance with Ind AS included in these standalone Ind AS financial statements
have been audited by the predecessor auditor. The report of the predecessor auditor on the
comparative financial information expressed an unmodified opinion.
Our opinion on the standalone financial statements and our report on Other Legal and Regulatory
Requirements below is not modified in respect of this matter.
Report on Other Legal and Regulatory Requirements
1) As required by the Companies (Auditor’s Report) Order,2016(“the Order”) issued by the Central
Government of India in terms of sub-section (11) of section 143 of the Act, we give in the
Annexure A, a statement on the matters specified in the paragraph 3 and 4 of the Order, to the
extent applicable.
2) As required by Section 143(3) of the Companies Act,2013 we report that:
a) We have sought and obtained all the information and explanations which to the best of our
knowledge and belief were necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so
far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss, the Cash Flow Statement and the changes

8
in equity dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid financial statements comply with the Indian Accounting Standards
(IND AS) prescribed under Section 133 of the Companies Act, 2013 read with relevant rules
issued there under and other accounting principles generally accepted in India.

26
INCAP LIMITED
e)
8
On the basis of written representations received from the directors as on 31st March, 2018 taken
on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2018
from being appointed as a director in terms of Section 164(2) of the Act.
f) With respect to the adequacy of internal financial controls over financial reporting of the Company
and the operating effectiveness of such controls, refer to our separate report in “Annexure B”,
and
g) With respect to the other matters to be included in the Auditor’s report in accordance with Rule
11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our
information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its
standalone Ind AS financial statements - Refer Note 31 to the standalone Ind AS financial
statements;
ii. The Company did not have any long term contracts including derivative contracts for which
there were any material foreseeable losses; and
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor
Education and Protection Fund by the Company.
For K.V.V.PRASAD & Co.,
Chartered Accountants
VIJAYAWADA
th
26 May, 2018 Firm Registration No. 002758S

(K.V.V.PRASAD)
PROPRIETOR
(ICAI Membership. No. 026708)

8
27
INCAP LIMITED
ANNEXURE – ‘I’

ANNEXURE - A TO THE INDEPENDENT AUDITOR’S REPORT

8
The Annexure referred to in Paragraph 1 under the heading of “Report on other Legal and
Regulatory Requirements” of our report of even date, to the members of INCAP LIMITED,
NIDAMANURU for the year ended 31st March 2018. We report that:
(i). (a) The company has maintained proper records showing full particulars including quantitative
details and situation of fixed assets.
(b) The Fixed Assets are physically verified by the management according to a phased program
designed to cover all the items over a period of three years which, in our opinion, is reasonable
having regard to the size of the company and the nature of its assets. No material discrepancies
were noticed on such physical verification.
(c) According to the information and explanations furnished to us, the title deeds of immovable
properties are held in the name of the company.
(ii). According to the information and explanation given to us, the inventory has been physically
verified by the management at reasonable intervals and the discrepancies noticed during such
physical verification of inventories as compared to books have been properly dealt with in the
books of account.
(iii). The company has not granted any loans, secured or unsecured to companies, firms and other
parties covered in the register maintained under section 189 of the Companies Act 2013.
(iv). The Company has granted an amount of Rs 6,90,000 as advance to its Director Ms. C. Neelima
during the year and the same has been recovered before 31st March’2018, which is not in
compliance with the provisions of section 185 of the Companies Act 2013.
(v). During the year under report the company has temporarily advanced an amount of Rs. 14.14
crores to 11 parties and the same were recovered during the year, which is not in compliance
with the provisions of Section 186 of the Companies Act, 2013. Out of the above loans Rs.4.43
crores are interest free loans.
(vi). The Company has not accepted any deposits from the public within the meaning of sections 73
to 76 and other applicable provisions of the Companies Act, 2013 and Companies (Acceptance
of Deposits) Rules, 2014 with regard to the deposits accepted from the public.
(vii). We have broadly reviewed the books of account and records maintained by the company
pursuant to the Rules made by the Central Government for the maintenance of Cost Records
under section 148 (1) of the Companies Act, 2013 relating to the manufacture of Aluminium
Electrolytic Capacitors and Silicon Rubber Insulators and are of the opinion that prima facie

8 the prescribed accounts and records have been made and maintained. However we have not
made a detailed examination of the same.
(viii).(a) According to the information and explanations given to us and on the basis of our
examination of the records of the company, in our opinion, the company is regular in depositing
28
INCAP LIMITED

8
with the appropriate authorities, the undisputed statutory dues including Provident Fund,
Employees’ State Insurance, Income Tax, Sales Tax, Service Tax, Duty of Customs, Duty of
Excise, Value Added Tax, Cess and other material statutory dues applicable to it.

(b) According to the information and explanations given to us, there were no amounts of Sales
Tax, Customs Duty, Excise Duty, Cess, Income Tax, Service Tax that have been disputed by
the company, and hence, were not remitted to the concerned authorities at the date of the
balance sheet under report, except the following

SL Name of the Statute Period Amount (Rs. Remarks

No.
1 Service Tax - The Finance Act 2012-13 Demand Pending CESTAT,
1994 and Rs. 149.58 Regional Bench,
2013-14
Penalty Hyderabad
Rs. 159.05

(ix). According to the records of the company examined by us, and the information and explanations
given to us, there were no defaults in repayment of loans or borrowings to banks and Government
during the year under report.
(x). The company did not raise any money by way of initial public offer or further public offer
(including debt instruments) except term loans from banks during the year under report and
the same were applied for the purposes for which those were raised.
(xi). During the course of our examination of the books and records of the company, carried out in
accordance with the Generally Accepted Audited Practices in India, and according to the
information and explanations given to us, we have neither come across any instances of material
fraud by the company or any fraud on the company by its officers or employees, noticed or
reported during the year, nor have we been informed of any such case by the management.
(xii). According to the information and explanations given to us and based on our examination of
the records of the Company, the Company has paid/provided for managerial remuneration in
accordance with the requisite approvals mandated by the provisions of section 197 read with
Schedule V to the Companies Act.
(xiii). In our opinion and according to the information and explanations furnished to us, the company
is not a Nidhi and hence, the requirement of clause 3(xii) of the Order is not applicable to the
company during the year under report.
(xiv). According to the information and explanations given to us and based on our examination of
the records of the Company, transactions with the related parties are in compliance with sections

8
177 and 188 of the Act where applicable and details of such transactions have been disclosed
in the standalone Ind AS financial statements as required by the applicable accounting standards.

29
INCAP LIMITED

8
(xv). According to the information and explanations given to us and based on our examination of
the records of the Company, the Company has not made any preferential allotment or private
placement of shares or fully or partly convertible debentures during the year.
(xvi) According to the information and explanations given to us and based on our examination of
the records of the Company, the Company has not entered into non-cash transactions with
directors or persons connected with him under the provisions of Section 192 of Companies
Act, 2013. Therefore the provisions of clause 3(xv) of the Order are not applicable.
(xvii)The Company is not required to be registered under section 45-IA of the Reserve Bank of
India Act 1934.

For K.V.V.PRASAD & Co.,

Chartered Accountants
VIJAYAWADA
Firm Registration No. 002758S
26th May, 2018

(K.V.V.PRASAD)
PROPRIETOR
(ICAI Membership. No. 026708)

8
30
INCAP LIMITED
ANNEXURE II

ANNEXURE - B TO THE INDEPENDENT AUDITORS’ REPORT

8
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the
Companies Act, 2013 (“the Act”)
We have audited the internal financial controls over financial reporting of INCAP LIMITED (“the
Company”) as of 31 March 2018 in conjunction with our audit of the standalone Ind AS financial statements
of the Company for the year ended on that date.
Management’s Responsibility for Internal Financial Controls
The Company’s management is responsible for establishing and maintaining internal financial controls
based on the internal control over financial reporting criteria established by the Company considering the
essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls
over Financial Reporting issued by the Institute of Chartered Accountants of India (‘ICAI’). These
responsibilities include the design, implementation and maintenance of adequate internal financial controls
that were operating effectively for ensuring the orderly and efficient conduct of its business, including
adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds
and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable
financial information, as required under the Companies Act, 2013.
Auditors’ Responsibility
Our responsibility is to express an opinion on the Company’s internal financial controls over financial
reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of
Internal Financial Controls over Financial Reporting (the “Guidance Note”) and the Standards on Auditing,
issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the
extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial
Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the
Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether adequate internal financial controls over financial reporting was
established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal
financial controls system over financial reporting and their operating effectiveness. Our audit of internal
financial controls over financial reporting included obtaining an understanding of internal financial controls
over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the
design and operating effectiveness of internal control based on the assessed risk. The procedures selected

8
depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the
financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinion on the Company’s internal financial controls system over financial reporting.

31
INCAP LIMITED
Meaning of Internal Financial Controls over Financial Reporting
8
A company’s internal financial control over financial reporting is a process designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting principles. A company’s internal
financial control over financial reporting includes those policies and procedures that
(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions
and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles, and that receipts and expenditures
of the company are being made only in accordance with authorizations of management and directors of
the company; and
(3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use,
or disposition of the company’s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the
possibility of collusion or improper management override of controls, material misstatements due to
error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial
controls over financial reporting to future periods are subject to the risk that the internal financial control
over financial reporting may become inadequate because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system
over financial reporting and such internal financial controls over financial reporting were operating
effectively as at 31 March 2018, based on the internal control over financial reporting criteria established
by the Company considering the essential components of internal control stated in the Guidance Note on
Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered
Accountants of India.

For K.V.V.PRASAD & Co.,

Chartered Accountants
Firm Registration No. 002758S

(K.V.V.PRASAD)

8
VIJAYAWADA
26th May, 2018
PROPRIETOR
(ICAI Membership. No. 026708)

32
INCAP LIMITED
INCAP LIMITED
1-58, Nidamanuru, Vijayawada - 521104.
Balance Sheet as at 31st March, 2018
8
Amount in Rs
Note
Particulars 31st March 2018 31st March 2017 1st April 2016
No.
Assets
(1) Non Current Assets
(a) Property, Plant and Machinery 2 4,47,36,826 4,27,63,166 5,49,06,361
(b) Financial Assets
(1) Loans 3 79,38,475 72,48,126 43,15,871
(c) Other Non Current Assets 4 52,46,574 56,92,858 56,08,447
(2) Current Assets
(a) Inventories 5 2,64,39,438 3,01,70,078 4,61,49,240
(b) Financial Assets
(i) Trade Receivables 6 6,25,21,809 6,25,96,777 8,77,23,622
(ii) Cash and Cash Equivalents 7 7,50,33,452 4,29,12,877 13,42,524
(c) Other Current Assets 8 19,53,581 8,68,506 12,13,980
TOTAL ASSETS 22,38,70,155 19,22,52,388 20,12,60,044

EQUITY AND LIABILITIES

Equity
(a) Equity Share Capital 9 5,13,32,000 5,13,32,000 5,13,32,000
(b) Other Equity 10 9,64,68,992 7,41,60,299 5,67,67,126
TOTAL EQUITY 14,78,00,992 12,54,92,299 10,80,99,126
LIABILITIES
(1) Non-Current Liabilities
(a) Financial Liabilities
(i) Borrowings 11 28,82,099 5,11,850 1,43,07,989
(b) Deferred Tax Liabilities (Net) 12 28,77,431 32,79,456 25,32,918
Total Non Current Liabilities 57,59,530 37,91,306 1,68,40,907
(2) Current Liabilities
(a) Financial Liabilities
(i) Borrowings 13 12,28,086 10,37,359 9,86,210
(ii) Trade Payable 14 5,35,98,418 4,46,40,707 5,82,93,126
(b) Other Current Liabilities 15 1,33,45,071 1,48,78,999 1,59,00,786
(c) Provisions 16 3,19,543 3,47,398 3,53,575
(d) Current Tax Liabilities (Net) 17 18,18,515 20,64,320 7,86,315
Total Current Liabilities 7,03,09,633 6,29,68,783 7,63,20,012
TOTAL EQUITY AND LIABILITIES 22,38,70,155 19,22,52,387 20,12,60,044
Summary of Significant Accounting Policies 1 For and on behalf of the Board
For K.V.V.PRASAD & CO.,
CHARTERED ACCOUNTANTS,
Firm Regn.No.002758S
C.BHAGAVANTHA RAO

8VIJAYAWADA
26th May, 2018
(CA. K.V.V.PRASAD)
Proprietor
M. No.026708
MANAGING DIRECTOR

Ms.C.Neelima
Director

33
INCAP LIMITED
INCAP LIMITED
PROFIT AND LOSS STATEMENT FOR THE YEAR ENDED ON 31ST MARCH, 2018
8
Note
Particulars No. 31st March 2018 31st March 2017

I Sales 18 28,36,78,805 28,57,03,969

Revenue from operations 28,36,78,805 28,57,03,969
II Other Income 19 1,05,09,361 38,29,037
III Total Income (I+II) 29,41,88,166 28,95,33,005
IV Expenses
Cost of Material Consumed 20 14,30,40,204 14,04,67,960
Changes in inventories of finished goods,
Stock-in-trade and Work-in-Progress 21 79,68,644 1,34,98,233
Employee Benefit Expenses 22 1,72,90,930 1,54,01,326
Finance Costs 23 13,42,640 41,44,414
Depriciation and Amortizational Expense 24 36,92,744 29,74,117
Other Expenses 25 8,19,18,205 7,75,31,486
Total Expenses (IV) 25,52,53,367 25,40,17,536
V Profit/(Loss) before exceptional items and Tax (I-IV) 3,89,34,799 3,55,15,470
VI Exceptional Items - -
VII Profit/(Loss) before Tax (V-VI) 3,89,34,799 3,55,15,470
VIII Tax Expense
(1) Current Tax 26 1,08,49,932 1,11,97,559
(2) Deferred Tax (4,02,025) 7,46,538
IX Profit/(Loss) for the period from Continuing Operations
(VII-VIII) 2,84,86,892 2,35,71,373
X Profit/(Loss) for the Discontinued Operations - -
XI Tax Expense of Discontinued Operations - -
XII Profit/(Loss) for the Discontinued Operations after Tax (X-XI) - -
XIII Profit/(Loss) for the period (IX+XII) 2,84,86,892 2,35,71,373
XIV Earnings per eauity share (for continuing operation)
(1) Basis 5.55 4.59
(2) Diluted 5.55 4.59

Summary of Significant Accounting Policies 1 For and on behalf of the Board

For K.V.V.PRASAD & CO.,

CHARTERED ACCOUNTANTS,
Firm Regn. No.002758S
C.BHAGAVANTHA RAO
MANAGING DIRECTOR

8VIJAYAWADA
26th May, 2018
(CA. K.V.V.PRASAD)
Proprietor
M. No.026708
Ms.C.Neelima
Director

34
INCAP LIMITED
INCAP LIMITED
1-58 Nidamanuru, Vijayawada - 521 104
CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2018
8
PARTICULARS For the year ending
31st March, 2018 31st March, 2017
Rs. Rs.
A CASH FLOW FROM OPERATING ACTIVITIES:
Net Profit After Tax and Extraordinary items 2,84,86,892 2,35,71,373
Adjustments :-
Tax expenses 1,04,47,907 1,19,44,097
Depreciation and Amortisation 36,92,744 29,74,117
(Profit)/Loss on sale of Proparty, Plant and Equipment 39,473 (9,81,635)
Finance costs 13,42,640 41,44,414
Interest Received (66,29,386) (24,57,653)
Unrealised foreign exchange (gain) / loss (22,09,720) -
Operating Profit Before Working Capital Changes 3,51,70,550 3,91,94,713
Adjustments for Working Capital Changes:
Decrease/(Increase) in Inventories 37,30,640 1,59,79,161
Decrease/(Increase) in Trade Receivables 74,968 2,51,26,845
Decrease/(Increase) in Loans and Advances (6,90,349) (29,32,255)
Decrease/(Increase) in Other Non-Current Assets 4,46,284 (84,411)
Decrease/(Increase) in Other Current Assets (10,85,074) 3,45,474
Increase /(Decrease) in Trade payables 1,11,67,431 (1,36,52,419)
Increase /(Decrease) in Provisions (Current) (27,855) (6,177)
Increase /(Decrease) in Current Liabilities (15,33,928) (10,21,787)
ADJUSTMENTS IN WORKING CAPITAL 1,20,82,117 2,37,54,431

Cash Generated from Operations 4,72,52,665 6,29,49,144

Income Tax Paid/Provided (1,10,95,737) (99,19,554)
Net Cash From Operating Activities {A} 3,61,56,928 5,30,29,590

8B CASH FLOW FROM INVESTING ACTIVITIES :

Purchase of Fixed assets
Sale of Fixed Assets
(57,39,503)
33,625
(38,92,922)
1,40,43,635

35
INCAP LIMITED

PARTICULARS For the year ending

8
31st March, 2018 31st March, 2017
Rs. Rs.

Interese Received 66,29,386 24,57,653

Net Cash Used In Investing Activities : {B} 9,23,508 1,26,08,366
C CASH FLOW FROM FINANCING ACTIVITIES:
Increase in Share Capital - -
Availment / (Repayment) of Borrowings 25,60,977 (1,37,44,990)
Proposed Dividend (51,33,200) (51,33,200)
Tax on Dividend (10,44,999) (10,44,999)
Interest paid on Borrowings (13,42,640) (41,44,414)
Net Cash Used in Financing Activities {C} (49,59,862) (2,40,67,603)
D NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS 3,21,20,574 4,15,70,353
Cash and Cash Equivalents at the beginning of the period 4,29,12,877 13,42,524
Cash and Cash Equivalents at the end of the period 7,50,33,452 4,29,12,877
NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS 3,21,20,575 4,15,70,353
Cash on hand 17,453 88,781
Balances held with banks 7,50,15,999 4,28,24,096
Cash and cash equivalents as restated 7,50,33,452 4,29,12,877

This is the Cash Flow Statement referred to in our report of even date
For and on behalf of the Board

For K.V.V.PRASAD & CO.,

CHARTERED ACCOUNTANTS,
Firm Regn. No.002758S
C.BHAGAVANTHA RAO
MANAGING DIRECTOR
(CA. K.V.V.PRASAD)

8VIJAYAWADA
26th May, 2018
Proprietor
M. No.026708
Ms.C.Neelima
Director

36
INCAP LIMITED

8
37
INCAP LIMITED
Financial Instruments
a) Management of market risk
i) Commercial risk, ii) Fair value risk, iii) Interest rate risk, iii) Foreign exchange risk
8
The above risks may affect income and expenses, or the value of its financial instruments of
the Company. The objective of the Management of the Company for market risk is to maintain this
risk within accepatable parameters, while optimising returns. The Company exposure to, and the
Management of, these risks is explained below:

8
38
INCAP LIMITED
1. Company overview and significant accounting policies
1.1. Company overview
8
The INCAP Limited (“the company”) a public limited company incorporated and domiciled in India
and has its registered office at Vijayawada. The securities of the company were listed in Bombay Stock
Exchange Limited.
The Company is engaged in the business of manufacture and sale of aluminium electrolytic capacitors.
The financial statements for the year ended March 31, 2018 were approved by the Board of Directors
and authorize for issue on 26th May,2018.
1.2. Basis for preparation of financial statements
These financial statements are prepared in accordance with Indian Accounting Standards (IND AS)
notified under section 133 of the Companies Act, 2013 (the Act) read with Rule 3 of the Companies
(Indian Accounting Standards ) Rules, 2015 and Companies (Indian Accounting Standards ) Amendment
Rules, 2016 and guidelines issued by the Securities and Exchange Board of India (SEBI).
Up to the year ended March 31, 2017, the Company prepared its financial statements in accordance with
the requirements of previous GAAP, which includes Standards notified under the Companies (Accounting
Standards) Rules, 2006, Companies (Accounting Standards) Amendment Rules, 2016 and the relevant
provisions of Companies Act,2013. These are the Company’s first Ind AS financial statements. The date
of transition to Ind AS is April 1, 2016. The company has adopted all the Ind AS standards and the
adoption was carried out in accordance with Ind AS 101 ‘First time adoption of Indian Accounting
Standards’. The transition was carried out from Indian Accounting principles generally accepted in
India, as prescribed under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules,
2014 (IGAAP), which was the previous GAAP. Reconciliations and descriptions of the effect of the
transition has been summarized.
The financial statement has been prepared on the historical cost convention under accrual basis of
accounting Historical cost is generally based on the fair value of the consideration given in exchange
for goods and services.
I. USE OF ESTIMATES
The preparation of financial statements in conformity with the IND AS requires management to make
certain estimates and assumptions that affect the amounts reported in the financial statements and notes
thereto. The management believes that these estimates and assumptions are reasonable and prudent.
However, actual results could differ from these estimates. Any revision to accounting estimates is
recognized prospectively in the current and future period. The application of Accounting policies that
require critical accounting estimates involving complex and subjective judgments and the use of
assumptions in these financial statements have been disclosed below.

8 • Defined benefit obligation.

• Estimation of useful life of Property, Plant and Equipment.
• Estimation and evaluation of provisions and contingencies relating to tax litigations.

39
INCAP LIMITED
II. REVENUE RECOGNITION
8
Revenue is measured at the fair value of the consideration received or receivable and net of returns,
trade allowances rebates and amounts collected on behalf of third parties. It includes Excise Duty but
excludes Value Added Tax, Sales Tax, Service tax and Goods and Services Tax (GST).
a) Sales and service earnings are inclusive of excise duty, service tax, freight, insurance etc. recovered
thereon.
b) Other Income: Revenue in respect of other income are recognised when there is a reasonable certainty
as to its realisation.
III. BORROWING COST
Borrowing costs that are directly attributable to the acquisition, construction or production of qualifying
assets are capitalised as part of the cost of that asset. Qualifying asset is an asset that necessarily takes
a substantial period of time to get ready for its intended use. Interest income earned on the temporary
investment of specific borrowings pending their expenditure on qualifying assets is deducted from the
borrowing cost eligible for capitalization. Borrowing costs also includes exchange differences to the
extent regarded as an adjustment to the borrowing costs.
Borrowing costs also includes exchange differences to the extent regarded as an adjustment to the
borrowing costs.
All other borrowing costs are charged to revenue in the period in which they are incurred.
IV. EMPLOYEE BENEFITS
Employee benefits include provident fund, employee state insurance scheme, and gratuity fund.
a) Defined Contribution Plans:
The Company’s contribution to provident fund and employee state insurance scheme are considered as
defined contribution plans and are charged as an expense based on the amount of contribution required
to be made and when services are rendered by the employees.
b) Defined Benefit Plans:
For defined benefit retirement benefit plans, the cost of providing benefits is determined using the
projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting
period.
Past service cost is recognised in profit or loss in the period of a plan amendment. Net interest is calculated
by applying the discount rate at the beginning of the period to the net defined benefit liability or asset.
Defined benefit costs are categorised as follows:
• Service cost (including current service cost, past service cost, as well as gains and losses on

8
curtailments and settlements);
• Net interest expense or income and
• Re-measurement.

40
INCAP LIMITED
c) Provident fund and Employees’ state insurance scheme: 8
Eligible employees of the INCAP Limited receive benefits from a provident fund and employees’ state
insurance scheme which is a defined benefit plan. Both the eligible employee and the company make
monthly contributions to the provident fund and employees’ state insurance equal to a specified percentage
of the covered employee’s salary.
V. PROPERTY, PLANT AND EQUIPMENT
TANGIBLE FIXED ASSETS
a) Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses,
if any. The cost of property, plant and equipment comprises its purchase price net of any trade discounts
and rebates, any import duties and other taxes (other than those subsequently recoverable from the tax
authorities), any directly attributable expenditure on making the asset ready for its intended use, other
incidental expenses and borrowings costs attributable to acquisition of qualifying property, plant and
equipment up to the date the asset is ready for its intended use and initial estimate of cost of
decommissioning, dismantling and removing the item & restoring the site on which it is located . Freehold
land is not depreciated.
b) Construction Period Expenses on Projects: All identifiable revenue expenses including interest on
term loans incurred in respect of various projects/ expansions are allocated to capital cost of respective
assets/ capital work in progress.
c) An item of property, plant and equipment is derecognised upon disposal or when no future economic
benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal
or retirement of an item of property, plant and equipment is determined as the difference between the
sales proceeds and the carrying amount of the asset and is recognised in profit or loss.
d) Depreciation is recognised so as to write off the cost of assets (other than freehold land and properties
under construction) less their residual values over their useful lives.
e) The estimated useful lives, residual values and depreciation method are reviewed at the end of each
reporting period, with the effect of any changes in estimate accounted for on a prospective basis.
f) Fixed assets retired from active use and held for disposal are stated at the lower of their net book
value and net realisable value and are disclosed separately under “Other Current Assets”.
g) Tangible assets not ready for the intended use on the date of Balance Sheet are disclosed as “Capital
work-in-progress”. Advances given towards acquisition / construction of fixed assets outstanding at
each Balance Sheet date are disclosed as Capital Advances under “Other Non-Current Assets”.
DEPRECIATION
Depreciation is provided in accordance with the useful life asprescribed under Part C of Schedule II to

8 the Companies Act, 2013 as follows:-

In respect of all the assets, the company is following straight line method of depreciation.

41
INCAP LIMITED
VI. IMPAIRMENT
a. Non-financial assets i.e. Property, plant & equipment:
8
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying
amount may not be recoverable. An impairment loss is recognized for the amount by which the asset’s
carrying amount exceeds its recoverable amount in the statement of Profit and loss. The recoverable
amount is the higher of an asset’s fair value less costs of disposal and value in use. An impairment loss
is reversed in the Statement of Profit and loss if there has been a change in the estimates used to determine
the recoverable amount. Non-Financial assets other than goodwill that suffered impairment are reviewed
for possible reversal of the impairment at the end of the each reporting period.
VII. FINANCIAL INSTRUMENTS
a. Initial Recognition:
The company recognises financial assets and financial liabilities when it becomes a party to the contractual
provisions of the instruments. All financial assets and liabilities are recognised at fair value on initial
recognition, except for trade receivables which are directly measured at transaction price. Transaction
costs that are directly attributable to the acquisition or issue of financial assets and liabilities that are not
at fair value through profit or loss, are added to the fair value on initial recognition.
b. Subsequent Recognition:
Financial assets carried at amortized cost
A financial asset is subsequently measured at amortized cost if it is held within a business model whose
objective is to hold the asset in order to collect contractual cash flows, and the contractual terms of the
financial asset gives rise on specified dates to cash flow that are solely payments of principal and interest
on the principal amount outstanding.
Financial assets at fair value through other comprehensive income
A financial asset is subsequently measured at fair value through other comprehensive income if it is held
within a business model whose objective is achieved by both collecting contractual cash flows and
selling financial asset and contractual terms of the financial asset give rise on specified dates to cash
flows that solely payments of principal and interest on the principal amount outstanding.
Financial assets at fair value through profit or loss
A financial asset which is not classified in any of the above categories is subsequently fair valued
through profit or loss.
Financial liabilities:
Financial liabilities are subsequently carried at amortised cost using the effective interest method, except
for contingent consideration recognised in a business combination which is subsequently measured at
fair value through profit and loss. For trade and other payables measuring within one year from the

8 Balance Sheet date, the carrying amounts approximate fair value due to the short maturity of these
instrumentsm.
De-recognition of financial assets and liabilities:
Financial assets:
42
INCAP LIMITED
A financial asset shall be derecognised when, and only when
• the contractual rights to the cash flows from the financial asset expire, or
• it transfer the financial asset and the transfer qualifies for de-recognition.
8
On de-recognition of a financial asset in it’s entirely, the difference between the carrying amount and the
consideration received shall be recognised in profit or loss.
Financial Liabilities:
A financial liability shall be derecognised when, and only when, obligation specified in the contract is
discharged or cancelled or expires. The difference between the carrying amount of a financial liability
extinguished or transferred and consideration paid should be recognised in profit or loss.
VIII. INVENTORIES
Inventories are valued at the lower of cost and estimated net realisable value (net of allowances) after
providing for obsolescence and other losses, where considered necessary. The cost comprises cost of
purchase, cost of conversion and other costs including appropriate production overheads in the case of
finished goods and work-in-progress, incurred in bringing such inventories to their present location and
condition. Trade discounts or rebates are deducted in determining the costs of purchase. Net realisable
value represents the estimated selling price for inventories less all estimated costs of completion and
costs necessary to make the sale. The cost (net of taxes subsequently recoverable from tax authorities)
of raw materials, stores & spares and traded goods is determined on first in first out method.
IX. CURRENT AND NON-CURRENT CLASSIFICATION
The Company presents assets and liabilities in the balance sheet based on current / non-current
classification. Cash or cash equivalent is treated as current, unless restricted from being exchanged or
used to settle a liability for at least twelve months after the reporting period. In respect of other assets, it
is treated as current when it is: expected to be realized or intended to be sold or consumed in the normal
operating cycle held primarily for the purpose of trading and
• expected to be realized within twelve months after the reporting period.
a) All other assets are classified as non-current.
b) A liability is treated as current when:
• it is expected to be settled in the normal operating cycle it is held primarily for the purpose
of trading
• it is due to be settled within twelve months after the reporting period, or
• there is no unconditional right to defer the settlement of the liability for at least twelve
months after the reporting period.
c) All other liabilities are classified as non-current.

8 d) Deferred tax assets and liabilities are classified as non-current assets and liabilities.
The operating cycle is the time between the acquisition of assets for processing and their realization in
cash and cash equivalents. The Company has identified twelve months as its operating cycle.

43
INCAP LIMITED
X. CASH AND CASH EQUIVALENTS
8
For the purpose of presentation in the statement of cash flows, cash and cash equivalents include cash on
hand, deposits held at call with financial institutions/banks, other short-term, highly liquid investments
with original maturities of three months or less that are readily convertible to known amounts of cash
and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts
are shown within borrowings in current liabilities in the balance sheet.
XI. CASH FLOW STATEMENT
Cash flows are reported using the indirect method, whereby the profit for the period is adjusted for the
effects of transactions of non-cash nature, any deferrals or accruals of past or future operating cash
receipts or payments and item of income or expenses associated with investing or financing cash flows.
The cash flows from operating, investing and financing activities of the company are segregated.
XII. FOREIGN EXCHANGE TRANSACTIONS
Functional Currency of the company is Indian Rupee. These financial statements are presented in Indian
Rupees.
Transactions and translations:
Transactions in foreign currency are initially accounted at the exchange rate prevailing on the date of the
transaction and adjusted appropriately with the difference in the rate of exchange arising on actual
receipt/payment during the year in determining net profit for the period.
• Foreign currency denominated monetary assets/ liabilities- are translated into the relevant functional
currency at exchange rates in effect at the balance sheet date. The gains or losses resulting from such
translations are included in net profit in the statement of profit and loss.
• Foreign currency denominated non-monetary assets/ non-liabilities are translated at the exchange
rate prevalent at the date of the transaction.
• Exchange differences arising on settlement of transactions and translation of monetary items are
recognised as income or expense in the year in which they arise.
XIII. TAXES ON INCOME
Tax expense comprises of current and deferred taxes. The income tax expense (income) for the period is
the tax payable on the current period’s taxable income based on the applicable income tax rate for each
jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences
and to unused tax losses.
a) The current income tax is the amount of income taxes payable in respect of the taxable profit (tax loss)
for a period. Management periodically evaluates positions taken in tax returns with respect to situations
in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate

8
b)
on the basis of amounts expected to be paid to the tax authorities
Deferred income tax is provided in full, using the liability method, on temporary differences arising
between the tax bases of assets and liabilities and their carrying amounts in the financial statements.

44
INCAP LIMITED

8
However, deferred tax liabilities are not recognized if they arise from the initial recognition of goodwill.
Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability
in a transaction other than a business combination that at the time of the transaction affects neither
accounting profit nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws)
that have been enacted or substantially enacted by the end of the reporting period and are expected to
apply when the related deferred income tax asset is realised or the deferred income tax liability is
settled.
Deferred tax assets are recognized only if it is probable that future taxable amounts will be available to
utilise those temporary differences and losses.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax
assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current
tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and
intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Current and deferred tax is recognized in profit or loss, except to the extent that it relates to items
recognized in other comprehensive income or directly in equity. In this case, the tax is also recognized
in other comprehensive income or directly in equity, respectively.
XIV. EARNING PER SHARE
The company’s Basic EPS is calculated by dividing profit or loss from continuing operations attributable
to ordinary equity holders by the weighted average number of ordinary shares outstanding during the
period as per IND AS-33, Earnings per Share.
The diluted EPS of an entity is calculated on the same basis as basic EPS, after adjusting for the effects
of dilutive potential ordinary shares unless the effect of the potential dilutive equity shares is anti-
dilutive.
XV. PROVISIONS/ CONTINGENT LIABILITIES AND ASSETS
Provision:
A provision is recorded when the Company has a present legal or constructive obligation as a result of
past events, it is probable that an outflow of resources will be required to settle the obligation and the
amount can be reasonably estimated. The estimated liability for product warranties is recorded when
products are sold based on technical evaluation.
Provisions are measured at the present value of management’s best estimate of the expenditure required
to settle the present obligation at the end of the reporting period. Provisions are discounted when time
value of money is material. The discount rate used to determine the present value is a pre-tax rate that
reflects current market assessments of the time value of money and the risks specific to the liability. The
increase in the provision due to the passage of time is recognized as interest expenses.

8
Contingent liabilities:
Wherever there is a possible obligation that arises from past events and whose existence will be confirmed
only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the
control of the entity or a present obligation that arises from past events but is not recognized because (a)
45
INCAP LIMITED

8
it is not probable that an outflow of resources embodying economic benefits will be required to settle the
obligation; or (b) the amount of the obligation cannot be measured with sufficient reliability. Show
cause notices are not considered as Contingent Liabilities unless converted into demand.
Contingent assets:
Wherever there is a possible asset that arises from past events and whose existence will be confirmed
only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the
control of the entity. A contingent asset is disclosed when the inflow of economic benefit is probable.
XVIII) SEGMENT REPORTING:
The Company is primarily engaged in the business of manufacturing aluminium electrolytic capacitors.
Since, the nature of the activities is governed by the same nature of risks, these are grouped as single
segment.
1.3 FIRST - TIME ADOPTION OF IND-AS
These standalone financial statements of The KCP Limited for the year ended 31st March 2018 have
been prepared in accordance with Ind AS. For the purposes of transition to Ind As, the company has
followed the guidance prescribed in Ind As 101-First Time adoption of Indian Accounting Standard,
with April 1, 2016 as the transition date andIGAAP as the previous GAAP.
The transition to Ind As has resulted in changes in presentation of the financial statements, disclosures
in the notes thereto and accounting policies and principles. The accounting policies set out in Note I
have been applied in preparing standalone finacial statements for the year ended March 31,2018 and the
comparative information. An explanation of how the transition from previous GAAP to Ind AS has
affected the Company's Balance Sheets, Statements of Profit and Loss, is set out in note 1.5 and
Exemptions on first time adoption of Ind AS availed in accordance with Ind AS 101 have been set out in
note 1.4.
1.4. EXEMPTION AVAILED FIRST TIME ADOPTION OF IND A 101
a. Deemed Cost :
For transition to Ind AS, the company has elected to continue with the carrying value of all its. property,
plant and equipment, Investment property and intangible assets are recognised as of April 1,2016
(Transition date) measured as per the previous GAAP and use that carring value as its deemed cost as of
the transition date, as there is no change in its functional currency.
b. Fair value measurement of financial or financial libilities at Initial recognition
Company has applied the requirements in Ind AS 109 prospectively to transactions entered into on or
after the date of transition to Ind AS.

8
46
47
Schedules Forming Integral Part of the Balance Sheet

8
Note : 2 Property, Plant and Machinery as at 3st March '2018

Gross Block Accumulated Depreciation Net Block

Particulars
Opening Addition Deduction Closing Opening Addition Deduction WDV as on WDV as on
Closing
31-03-2018 31-03-2017
INCAP LIMITED

(a) Trangible Assets

Land 39,23,300 - - 39,23,300 - - - - 39,23,300 39,23,300

Road and Culverts 13,97,283 - - 13,97,283 7,65,936 79,667 - 8,45,603 5,51,680 6,31,347

Building 2,31,73,753 - - 2,31,73,753 90,88,302 2,71,111 - 93,59,413 1,38,14,340 1,40,85,451

Plant and Mechinery 9,47,18,039 10,99,260 - 9,58,17,299 8,61,35,367 3,91,551 - 8,65,26,918 92,90,381 85,82,672

Electrical Installation 76,90,458 - - 76,90,458 48,49,434 3,51,922 - 52,01,356 24,89,102 28,41,024

Lab Equipment 22,49,097 - - 22,49,097 14,21,247 1,23,488 - 15,44,736 7,04,361 8,27,850

Office Equipment 22,14,586 1,68,541 89,960 22,93,167 12,47,510 1,12,092 48,528 13,11,075 9,82,092 9,67,076

Furnitures & Fixtures 57,45,500 2,55,360 - 60,00,860 17,75,064 5,06,485 - 22,81,549 37,19,311 39,70,436

Vehicles 91,67,505 41,79,562 56,272 1,32,90,795 29,49,491 12,16,179 24,606 41,41,064 91,49,731 62,18,014

Data Processing Equipment 31,40,295 36,780 - 31,77,075 30,08,184 56,363 - 30,64,547 1,12,528 1,32,111

Goodwill 99,95,830 - - 99,95,830 99,95,830 - - 99,95,830 - -

Computer Software 20,00,000 - - 20,00,000 14,16,115 5,83,885 - 20,00,000 - 5,83,885

Total 16,54,15,646 57,39,503 1,46,232 17,10,08,917 12,26,52,480 36,92,743 73,134 12,62,72,091 4,47,36,826 4,27,63,165

Previoius Year 18,24,03,788 38,92,922 2,08,81,064 16,54,15,646 12,74,97,247 29,74,117 78,19,064 12,26,52,480 4,27,63,166 5,49,06,361
8
INCAP LIMITED
Note : 3 Loans (Non-Current)
Particulars
Loans
As at 31st March 2018
79,38,475
8
As at 31st March 2017
72,48,126
79,38,475 72,48,126

Note : 4 Other Non current Assets

Particulars As at 31st March 2018 As at 31st March 2017
IDBI Bank Dividend Accounts 9,53,605 9,19,182
Margin Money Deposit 6,21,114 5,34,245
Stores and Spares 57,592 98,472
Service Tax Receivable 11,93,373 11,93,373
TDS Receivable 24,20,890 24,20,890
MODVAT on Raw Materials - 2,96,907
other Capital Goods - 2,29,789
52,46,574 56,92,858

Note : 5 Inventories
Particulars As at 31st March 2018 As at 31st March 2017
Raw Materials 1,27,39,189 85,01,186
Finished Good 1,15,02,497 1,85,92,534
Work in Progress 21,97,752 30,76,358
2,64,39,438 3,01,70,078

The cost of inventories is recognised as an expense during the year in respect of continuing operation was
Rs. 15,15,14,748 for year ended 31-03-2018 (Rs. 15,45,42,031 for the year ended 31-03-2017)

The mode of valuation of Inventories has been stated in accounting Policy VIII of Note 1.2.

Note : 6 Trade Receivables

Particulars As at 31st March 2018 As at 31st March 2017
Trade Receivables 4,91,42,186 5,50,98,974
Advances to suppliers 1,33,79,623 74,97,803
6,25,21,809 6,25,96,777

Note : 7 Cash and Cash Equivalents

Particulars As at 31st March 2018 As at 31st March 2017
Cash on hand 17,453 88,781

8
Term Deposits 2,75,00,000 3,72,00,000
Other Deposits 9,40,900 9,40,900
Bank OD (Debit Balance) 4,65,58,335 42,25,090
Bank Accounts 16,764 4,58,106
7,50,33,452 4,29,12,877

48
INCAP LIMITED
Note : 8 Other Current Assets
Particulars
Customs Duty (Diodes)
As at 31st March 2018
-
8
As at 31st March 2017
11,448
Others 17,44,506 7,75,978
Advances (Receivables) 2,09,075 81,080
19,53,581 8,68,506

Note : 9 Equity Share Capital

Particulars As at 31st March 2018 As at 31st March 2017
Authorised Capital
60,00,000 Equity Shares of Rs.10/-each 6,00,00,000 6,00,00,000
Issued Capital
60,00,000 Equity Shares of Rs.10/-each 6,00,00,000 6,00,00,000
Subscribed Capital
54,49,600 Equity Shares of Rs.10/-each 5,64,96,000 5,64,96,000
Paid up Capital
Equity Shares Capital 5,13,32,000 5,13,32,000
5,13,32,000 5,13,32,000

Details of Shareholders holding more than 5% share in the Company

Name of the Shareholder % Shares % Shares
Sri C. Bhagavantha Rao 19.94 1023707 19.94 1023707
Smt. C. Neelima 23.60 1211407 23.60 1211407
Smt. P. Himabindu 12.63 648399 12.63 648399
Sri P. Ram Rao 09.95 510933 09.95 510933
Smt. C.Lalitha Kumari 07.17 368045 07.17 368045

Note : 10 Other Equity

Particulars As at 31st March 2018 As at 31st March 2017
Capital Reserve 33,82,000 33,82,000
General Reserve 1,54,31,042 1,54,31,042
Share Premium 22,40,000 22,40,000
Surplus in Profit & Loss Account
Balance brought forward from Previous year 5,31,07,257 3,57,14,084
Add. Profit for the period 2,84,86,892 2,35,71,372
8,15,94,149 5,92,85,456
Less: Proposed Dividend 51,33,200 51,33,200
Tax on Dividend 10,44,999 10,44,999
7,54,15,950 5,31,07,257
9,64,68,992 7,41,60,299

8
Note : 11 Borrowings (Non-Current)
Particulars As at 31st March 2018 As at 31st March 2017
Vehicle Loan from Banks 28,82,099 5,11,850
28,82,099 5,11,850

49
INCAP LIMITED
Note : 12 Deferred Tax Liabilities
Particulars
Fixed assets: Difference between
As at 31st March 2018
8
As at 31st March 2017

tax depreciation and depreciation/

amortisation charged for the
financial reporting 28,77,431 32,79,456
28,77,431 32,79,456

Note : 13 Borrowings (Current)

Particulars As at 31st March 2018 As at 31st March 2017
Current Maturities of long
term liabilities 12,28,086 10,37,359
12,28,086 10,37,359

Note : 14 Trade payables

Particulars As at 31st March 2018 As at 31st March 2017
Trade Payables 5,31,53,621 4,42,75,470
Advances from Customers 4,44,797 3,65,237
5,35,98,418 4,46,40,707

Note : 15 Other Current Liabilities

Particulars As at 31st March 2018 As at 31st March 2017

Liabilities for Expenses 1,33,45,071 1,48,78,999

1,33,45,071 1,48,78,999

Note : 16 Provisions
Particulars As at 31st March 2018 As at 31st March 2017

VAT /GST Payble 1,71,356 30,924

CST Payble - 3,16,474
Income Tax payable (A.Y.2018-19) 1,48,187 -
3,19,543 3,47,398

Note : 17 Current Tax Liabilities

Particulars As at 31st March 2018 As at 31st March 2017

Advance tax
Advance payment of
Direct Taxes / TDS Credit 90,31,417 91,33,239

8Provision for Tax

Provision for Income tax
Total
1,08,49,932
18,18,515
1,11,97,559
20,64,320

50
INCAP LIMITED
Note : 18 Revenue from Operations

Sale of Products
Particulars 31st March 2018

18,58,59,951
8
31st March 2017

16,95,63,044
Excise Duty & Cess Collections 57,78,363 2,12,55,496
19,16,38,314 19,08,18,540
Traded Goods 44,450 36,720
Other Operating Income 9,19,96,041 9,48,48,709
Total 28,36,78,805 28,57,03,969

Note : 19 Other Income

Particulars 31st March 2018 31st March 2017
Interest Income 66,29,386 24,57,653
Profit on Sale of Assets - 9,81,635
Scrap Sales 20,773 3,71,561
Other Receipts 16,49,482 18,188
Exchange Variance 22,09,720 -
Total In 1,05,09,361 38,29,037

Note : 20 Cost of Material Consumed

Particulars 31st March 2018 31st March 2017
Opening Stock 83,98,539 1,08,93,822
Add. Purchases 14,51,06,488 13,79,72,677
15,35,05,027 14,88,66,499
Less : Closing Stock 1,04,64,823 83,98,539
Raw Material Consumed 14,30,40,204 14,04,67,960

Details of Raw Material consumed

Particulars 31st March 2018 31st March 2017

Simi finished capacitors 11,14,95,376 10,77,47,565

Anode Foil 1,35,77,989 1,42,07,328
Cathode Foil 19,98,640 20,76,894

8
Tissue Paper 24,17,344 23,63,403
Others 1,35,50,855 1,40,72,770
Total 14,30,40,204 14,04,67,960

51
INCAP LIMITED

Note : 21 Change in Inventories

Opening Stock
Particulars st
31 March 2018 st
8
31 March 2017

Stock-in-Trade 84,112 1,29,782

Finished Goods 1,85,08,422 2,31,96,030
Work-in-Progress 30,76,359 1,18,41,314
2,16,68,893 3,51,67,126
Closing Stock
Stock-in-Trade 32,076 84,112
Finished Goods 1,14,70,421 1,85,08,422
Work-in-Progress 21,97,752 30,76,359
1,37,00,249 2,16,68,893
Total 79,68,644 1,34,98,233

Note : 22 Employement Benefit Expenses

Particulars 31st March 2018 31st March 2017
Salaries 1,30,23,956 1,16,67,221
Bonus, PF & ESIC 22,60,528 19,25,680
Exgratia 14,35,465 11,95,042
Workmen & Staff Welfare Expenses 5,70,981 6,13,383
Total 1,72,90,930 1,54,01,326

Note : 23 Financial Cost

Particulars 31st March 2018 31st March 2017
Interest Expenses 13,42,640 41,44,414

Total 13,42,640 41,44,414

Note : 24 Depreciation & Amortised Cost

Particulars 31st March 2018 31st March 2017
Depreciation 36,92,744 29,74,117

8Total 36,92,744 29,74,117

52
INCAP LIMITED
Note : 25 Other Administrative Expenses

Bank Charges
Particulars 31st March 2018
1,23,707
8
31st March 2017
2,69,034
Insurance 6,77,792 7,75,766
Power and Fuel 30,57,343 27,68,556
Repairs and Maintenance 9,17,069 12,94,945
Freight Inward 57,907 1,73,605
Taxes & Licences 19,86,592 44,34,111
Rent 12,93,000 9,62,500
Telephone and Telex Charges 5,15,259 4,82,075
Directors Remuneration 40,60,000 27,79,706
Auditors Fees 50,000 34,155
Directors Sitting Fees 4,000 6.000
Directors Travelling Expenses 2,94,204 1,28,329
Travelling Expenses 53,44,423 82,51,119
Donations 9,85,960 35,000
Vehicle Maintenance 12,09,255 14,43,537
Advertisement Charges 1,05,132 1,13,410
Business Promotion Expenses 5,63,333 7,70,313
Commission on Sales 8,70,818 7,09,483
Consumption of packing material 14,89,446 13,01,782
Freight Outward 23,73,106 21,42,862
Other Selling Expenses 1,42,607 6,52,278
Contract Work Expenses 4,72,70,599 4,36,10,811
Other Expenses 85,26,653 43,92,109
Total 8,19,18,205 7,75,31,486

Note : 26 Current Tax

Particulars 31st March 2018 31st March 2017
Current Tax 1,08,49,932 1,11,97,559
Add:Excess / Short Provision earlier year - -

8Less : MAT Credit Entitlement

Total 1,08,49,932
-
1,11,97,559
-

53
INCAP LIMITED
ANNEXURE - C
Form No. MR-3
SECRETARIAL AUDIT REPORT
FOR THE FINANCIAL YEAR ENDED MARCH 31, 2018
8
[Pursuant to section 204(1) of the Companies Act, 2013 and rule No.9 of the Companies
(Appointment and Remuneration Personnel) Rules, 2014]
To,
The Members
INCAP LIMITED
Reg. Office:
1-58, Nidamanuru, Vijayawada
Krishna, Andhra Pradesh – 521104.
CIN: L32101AP1990PLC011311
I have conducted the secretarial audit of the compliance of applicable statutory provisions and the
adherence to good corporate practices by M/s. INCAP LIMITED (hereinafter called the Company).
Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the
corporate conducts/statutory compliances and expressing my opinion thereon.
Based on my verification of the books, papers, minute books, forms and returns filed and other records
maintained by the Company and also the information provided by the Company, its officers, agents and
authorized representatives during the conduct of secretarial audit, we hereby report that in our opinion,
the Company has, during the audit period commencing from 01st April, 2017 and ending on 31st
March, 2018 complied with the statutory provisions listed hereunder and also that the Company has
proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to
the reporting made hereinafter:
I have examined the books, papers, minute books, forms and returns filed and other records maintained
for the period ended on 31st March, 2018 according to the provisions of:
(i) The Companies Act, 2013 (the Act) and the Rules made thereunder;
(ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the Rules made thereunder;
(iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;
(iv) Foreign Exchange Management Act, 1999 and the Rules and Regulations made thereunder to the
extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial
Borrowings;
(v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of
India Act, 1992 (‘SEBI Act’) to the extent applicable to the Company :-

8 a)

b)
The Securities and Exchange Board of India (Substantial Acquisition of Shares and
Takeovers)Regulations, 2011;
The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992;

54
INCAP LIMITED
c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements)
8
Regulations, 2009 - Not applicable as the Company has not issued any new Securities during
the period under review.
d) The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock
Purchase Scheme) Guidelines, 1999 - Not applicable as the Company has not issued any new
Securities to its Employees during the period under review.
e) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents)
Regulations, 1993 regarding the Companies Act and dealing with client – Not Applicable as the
Company is not registered as Registrar to Issue and Share Transfer Agent during the Period
under review.
f) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009 - Not
applicable as the Company has not delisted/propose to delist its equity shares from stock
exchange during the period under review.
g) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998 - Not
applicable as the Company has not bought back/propose to buyback any of its securities during
the period under review.
h) The Company has identified the following laws as specifically applicable to the Company:
1. The Hazardous wastes( Management and Handling) Rules 1969
2. The Factories Act, 1956
3. The Legal Metrology Act, 2009
I have also examined compliance with the applicable clauses of the following:
(i) Secretarial Standards issued by The Institute of Company Secretaries of India (ICS) - ICSI.
(ii) The Listing Agreements entered into by the Company with the Bombay Stock Exchange of India
Limited.
During the period under review the Company has complied with the provisions of the Act, Rules,
Regulations, Guidelines, Standards, the Securities and Exchange Board of India (ListingObligations and
Disclosure Requirements) Regulations, 2015 etc. mentioned above subject to the following observations:
1. The Company has not appointed Company Secretary as per the Provisions of Section 203 of the Companies
Act, 2013. However, the company has availed the services of practicing company secretaries wherever
applicable and complied with the provisions of the companies act and its rules, regulations to ensure that
the filings with MCA and other statutory authorities are up to date.
2. The Company has an Audit Committee; however the composition of the committee consists of promoter
directors only. The company submitted that the company’s registered office and works being carried out
from a rural area, it is finding it difficult to appoint independent directors who are generally located in

8
3.
large cities. However, the company undertakes to appoint the independent directors.
The Company has Remuneration Committee, the composition of which consists of promoter directors
only due to absence of independent directors on Board. However there is no case where the remuneration
has to be fixed by the remuneration committee during the financial year.
55
INCAP LIMITED
4.
8
The Company has constituted Vigil Mechanism and such other committees as per the Provisions of the
Companies Act, 2013 subject to limitations stated above.
I further report that:
1. The Board of Directors of the Company is constituted with Executive Directors and Non-Executive
Directors.
2. According to Sub Regulation (2) of Regulation 15 of the Securities and Exchange Board of India
(ListingObligations and Disclosure Requirements) Regulations, 2015the compliance with the corporate
governance provisions as specified in regulations 17, 18, 19, 20, 21,22, 23, 24, 25, 26, 27 and clauses (b)
to (i) of sub-regulation (2) of regulation 46 and para C , D and E of Schedule V shall not apply to the
Companies with Companies having paid up equity share capital not exceeding Rs.10 Crore and Net
Worth not exceeding Rs.25 Crore, as on the last day of the previous financial year.
3. There are no changes in the composition of the Board of Directors during the period under review.
4. Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on
agenda were sent at least seven days in advance, and a system exists for seeking and obtaining further
information and clarifications on the agenda items before the meeting and for meaningful participation
at the meeting.
5. Majority decision is carried through while the dissenting members’ views are captured and recorded as
part of the minutes.
I further report that:
a. There are adequate systems and processes in the company commensurate with the size and operations of
the company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.
b. As informed, the Company has responded to Notices for demands, claims, penalties etc. levied by the
statutory/regulatory authorities and initiated actions for corrective measures, wherever necessary.
I further report that during the audit period, there are no specific events/actions having a major bearing
on the Company’s affairs in pursuance of the laws, rules, regulations, guidelines, standards, etc, referred
to above.

For AN Sarma & Co.,

Practicing Company Secretaries

AN Sarma
(Partner)

8
Hyderabad C. P. No.: 7812
26 May, 2018

56
INCAP LIMITED

To
ANNEXURE
8
The Members of
M/s.Inap Limited
Vijayawada
1. Maintenance of secretarial records is the responsibility of the management of the Company. Our
responsibility is to express an opinion on these secretarial records based on our audit.
2. We have followed the audit practices and processes as were appropriate to obtain reasonable assurance
about the correctness of the contents of the secretarial records. The verification was done on the random
test basis to ensure that correct facts are reflected in secretarial records. We believe that the processes
and practices, we followed provide a reasonable basis for our opinion
3. We have not verified the correctness and appropriateness of financial records and Books of Accounts
of the Company
4. Wherever required, we have obtained the Management representation about the compliance of laws,
rules and regulations and happening of events etc.
5. The compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards
is the responsibility of the Management. Our examination was limited to the verification of procedures
on random test basis
6. The Secretarial Audit report is neither an assurance as to the future viability of the Company nor of the
efficacy or effectiveness with which the management has conducted the affairs of the Company.

For AN Sarma & Co.,

Practicing Company Secretaries

AN Sarma
(Partner)
C. P. No.: 7812

Hyderabad

8
26 May, 2018

57
INCAP LIMITED
ANNEXURE – D
CORPORATE GOVERNANCE REPORT
COMPANY’S PHILOSOPHY ON CODE OF CORPORATE GOVERNANCE:
8
Corporate Governance refers to the combination of voluntary practices and compliance’s with law and
regulators leading to effective control and management of the organization. The fundamental objective
of INCAP’s Corporate Governance is “enhancement of the long-term shareholder value at the same time
protecting the interests of other shareholder”. Corporate Governance brings into focus the fiduciary and
trusteeship role of the Board to align and direct the action of the organization towards creating a wealth
and shareholder value.
1. BOARD OF DIRECTORS :
i) Composition:
The present strength of the Board Directors is 4 and is responsible for the Management of the Company’s
business. The functions, responsibility, role and accountability of the Board are well defined. The Board
in addition to monitoring corporate performance also carries out functions such as approving the business
plan, reviewing and approving the annual budgets and borrowing limits and ensures that your company
keeps shareholders informed about plans, strategies and performance. The detail report of the company’s
performance is periodically, placed before the Board. The Board consists of 2 Executive Directors and 2
Non-Executive Directors whose details are as follows:
a. Promoter / Executive Directors:
Sri C.BhagavanthaRao Managing Director
SmtC.Neelima Whole-time Director
b. Promoter / Non-Executive Directors:
Sri P.RamRao Director
Smt. P.Himabindu Director
i) Board Meetings and Attendance at Board Meetings :
a) During 2017-2018, the Board of Directors met 4 times on the following dates:
The relevant details are as under:

S.No. Date Board Strength No. of Directors Present

1 29th May, 2017 4 4

2 27th July, 2017 4 3

8 3

4
31th October, 2017

09st January, 2018

4

4
3

58
INCAP LIMITED

8
The company places before the Board all those details as required under to the listing regulation. The
dates for the board meetings are fixed after taking into account the convenience of all the directors and
sufficient notice is given to them. The company has video conferencing facilities to enable director’s
participation at board meetings. Detailed agenda notes are sent to the directors. All the information
required for decision making are incorporated in the agenda. Those that cannot be included in the agenda
are tabled at the meeting. The chairman and the managing director appraise the Board on the overall
performance of the company at every board meeting. Legal issues, write-offs, provisions, purchase and
disposal of capital assets are all brought to the notice of the Board. The Board reviews performance,
approves capital expenditures, sets the strategy the company should follow and ensures financial stability.
The Board takes on record the actions taken by the company on all its decisions periodically.
The Board also takes on record the declaration made by the company secretary, chairman and managing
director and the chief financial officer regarding compliances of all laws on a quarterly basis.
b) The details of attendance of each Director at the Board Meetings, last Annual General Meeting and their
composition, category and other Directorships as follows:

Name of the Director Category Attendance Particulars

Board Meeting Last AGM

Sri C.Bhagavantha Rao Non-Independent Executive 4 Yes

Sri P.Ram Rao Non-Independent 3 Yes
Non-Executive
Smt. C.Neelim Non-Independent Executive 4 Yes
Smt. P.Himabindu Non-Independent 3 Yes
Non-Executive

2. AUDIT COMMITTEE:
2.1 Brief description of terms and reference :
The terms of reference as per clause 49 of the Listing regulation are as follows:
a) To review the results announcement and the report and accounts at the end of quarter, half year and the
full year before submission of the Board, focusing particularly on.
i) Any changes in accounting policies and practices.
ii) Compliance with accepted accounting standards.
iii) Major judgmental decisions etc.
b) To consider appointment of Statutory Auditors, the Audit Fee, and any matter of resignation and dismissal.

8
c)
d)
To discuss with the Statutory Auditors, the Audit commences the nature and scope of the Audit.
To review the effectiveness of the system of internal financial controls and discuss the same periodically
with the statutory auditors.

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INCAP LIMITED
e)

f)
may wish to discuss.
To consider other topics as may be delegated by the Board from time to time.
8
To discuss problems and reservations arising from the statutory audit and any matters the statutory auditor

g) The audit committee comprised of the following directors for the year ended 31st March 2016:
Name of the Director Category
Sri C.BhagavanthaRao Non-Independent Executive
Sri P.RamRao Non-Independent Non-Executive
Smt. C.Neelima Non-Independent Executive
* The company undertakes to appoint the independent directors before the closure of the current financial
year.
Meeting during the year:
During the financial year 2017-2018, the Audit Committee met 4 times on following dates with full strength:
1. 29th May, 2017
2. 27thJuly, 2017
3. 31st October, 2017
4. 09st February, 2018
3. NOMINATION AND REMUNERATION COMMITTEE
(I) Brief description of terms of reference is for:
(a) appointment of the directors, and key managerial personnel of the Company; and
(b) fixation of the remuneration of the directors, key managerial personnel and other employees of the
Company.
(II) Composition of committee and attendance of members

S.No. Name of the Director and Position Meeting / Attendance

29.05.2017 27.07.2017 31.10.2017 09.02.2018
1. Sri C.Bhagavantha Rao, Chairman Y Y Y Y

2. Smt. C.Neelima, Member Y Y Y Y

3. Sri P.Ram Rao, Member Y Y N Y
4. Smt. P.Himabindu, Member Y N Y Y

8 This committee recommends the appointment/reappointment of executive directors and the appointments
of employees from the level of vice-president and above along with the remuneration to be paid to them.
The remuneration is fixed keeping in mind the persons track record, his/her potential individual
performance, the market trends and scales prevailing in the similar industry. The Remuneration Committee
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INCAP LIMITED

committee. Mrs.C.Neelima and Mr.P.RamRao and Mrs.P.Himabindu are the other members. The 8
comprises of non-executive and independent directors. Mr.C.BhagavanthaRao, is the chairman of the

Mrs.P.Himabindu is the secretary to the committee. During the financial year 2017-2018 the committee
met on 31.01.2017.
4. INVESTORS AND SHAREHOLDER’S GRIEVANCE COMMITTEE:
Brief description of terms of reference:
To look into various affairs relating to the shareholders with regard to redressal of complaints in relation
to transfer of shares, non-receipt of share certificates, balance sheets, dividends etc.
The Committee comprises of three directors as composition of the committee.
Mr. C. BhagavanthaRao, is the chairman of the committee. Mrs.C.Neelima and Mr. P.Ram Rao are the
other members.
The committee decided that a share transfer committee be constituted with Mr. Mrs.C.Neelima, Whole
time Director and Mr.C.BhagavanthaRao, Managing Director as members to approve share transfer,
transmissions, issue of duplicate share certificates, rematerialisation of shares etc. The actions of share
transfer committee will be ratified in Stakeholders’ Relationship Committee at its subsequent meeting.
5. MEETING OF INDEPENDENT DIRECTORS :
No meeting of Independent Directors held during year. Since, Independent Director/s was not appointed.
*The company undertakes to appoint the independent directors before the closure of the current financial
year.
6. REMUNERATION OF DIRECTORS :
The Company does not remunerate the Non-Executive Directors of the Company except for the payment
of sitting fees for attending each meeting of the Board of Committee thereof. Remuneration of Executive
Directors is fixed by the Board and approved by shareholder at the Annual General Meeting. Particulars
of their remuneration for the year ended 31st March, 2018 are given below:

Name of the Director Remuneration

Execitive Director Sitting Fee Salary Perquisites Commission Total Rs.

Sri.C.Bhagavantha Rao Nil 1577400 9680000 Nil 2400000

Smt. C.Neelima Nil 822600 692000 Nil 1514600
Non-Executive Directors:
Sri P.Ram Rao 2000 Nil Nil Nil 2000
Smt. P.Himabindu 4000 Nil Nil Nil 4000

8
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INCAP LIMITED
1. ANNUAL GENERAL MEETINGS AND EXTRAORDINARY GENERAL MEETING:
Details of venue and time of last 3 Annual General Meetings are as under:
Financial Year : 2014-2015
8
Venue : Registered Office, 1-58, Nidamanuru,
Vijayawada – 521104.
Date : 26-09-2015
Time : 12.00 Noon
Financial Year : 2015-2016
Venue : Registered Office, 1-58, Nidamanuru,
Vijayawada – 521104.
Date : 24-09-2016
Time : 12.00 Noon
Financial Year : 2016-2017
Venue : Registered Office, 1-58, Nidamanuru,
Vijayawada – 521104.
Date : 23-09-2017
Time : 12.00 Noon

8. SUBSIDIARY COMPANIES
The company does not have any Subsidiary Company.
9. A) RISK MANAGEMENT
Periodic assessments to identify the risk areas are carried out and management is briefed on the risks in
advance to enable the company to control risk through a properly defined plan. The risks are classified as
financial risks, operational risks and market risks. The risks are taken into account while preparing the
annual business plan for the year. The Board is also periodically informed of the business risks and the
actions taken to manage them. The Company has formulated a policy for Risk management with the
following objectives:
• Provide an overview of the principles of risk management
• Explain approach adopted by the Company for risk management
• Define the organizational structure for effective risk management
• Develop a “risk” culture that encourages all employees to identify risks and associated opportunities
and to respond to them with effective actions.
• Identify, assess and manage existing and new risks in a planned and coordinated manner with minimum

8 disruption and cost, to protect and preserve Company’s human, physical and financial assets.
B) RISK MANAGEMENT COMMITTEE:

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INCAP LIMITED
The company has constituted a Risk Management company with the following directors:
A.
B.
Mr.C.BhagavanthaRao
Mrs.C.Neelima
8
C. Mr.P.RamRao and
D. Mrs.P.Himabindu
10. WHISTLE BLOWER POLICY
The company has an established mechanism for Directors / Employees to report concerns about unethical
behaviour, actual or suspected fraud, or violation of the code of conduct or ethics policy. It also provides
for adequate safeguards against victimization of directors/ employees who avail of the mechanism. The
company affirms that no personnel has been denied access to the audit committee. The Company has
formulated a Policy of Vigil Mechanism and has established a mechanism that any ppersonnel may
raise Reportable Matters within 60 days after becoming aware of the same. All suspected violations and
Reportable Matters are reported to the Chairman of the Audit Committee. The key directions/actions
will be informed to the Managing Director of the Company.
11. DISCLOSURES:
RELATED PARTY TRANSACTION:
There are no related party transactions made by the company with its promoters, directors or the
management, their relative conflicting with company’s interest.
No penalty or strictures have been imported on the company by stock exchange or SEBI or any statutory
authority on any matter related to capital markets during the last three years.
12. ACCOUNTING TREATMENT:
Disclosure required in case of difference in the treatment from that of annual accounts, the applicable
accounting standards have been followed and that there are no material departures.
13 COMPLIANCES:
There have been no instances of non-compliance by the company on any matters related to the capital
markets, nor have any penalty/strictures been imposed on the company by the Stock Exchanges or SEBI
or any other statutory authority on such matters.
14. MEANS OF COMMUNICATION:
The quarterly, half yearly and annual results of the company in the prescribed Proforma are published in
the following News Papers.

8 1. Business Lines (English)

2. Andhra Bhoomi (Regional Language)
There is no practice of sending half-yearly results to the household of shareholders.

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INCAP LIMITED
15 CODE OF CONDUCT FOR THE BOARD OF DIRECTORS AND THE SENIOR MANAGEMENT
I. Preface:
8
Over the years, the Company has been conducting its business with very high ethical and moral standards.
This has resulted in gaining reputation as a professionally managed company by all its members. As the
Company grows and expands its wings globally, it is extremely important to continue to exhibit high
levels of ethical standards and professional behavior in everything that the Company does.
This Model Code of Conduct for Directors & Senior Management personnel is a guide to help Senior
Management team & Directors on the Board of Incap. Though it summarizes many of the laws that
Incap, as a Company is required to follow, it also goes beyond the legal minimums by describing the
ethical values we share at Incap.
The rules and principles set forth in this Code are general in nature and the compliance with the Code
shall be ensured read with other applicable policies and procedures of the Company. The Directors and
Senior Management personnel may contact the Compliance Officer for assistance in interpreting the
requirement of this Code.
The Board of Directors of the Company adopted this Code of Conduct and Ethics as a testimony of its
commitment to adhere to the standards of loyalty, honesty, integrity and the avoidance of conflicts of
interest. This code is a capsule of the moral, legal and professional obligations of the Directors and all
executives. The Specific provisions of law or rules or regulations or contract shall prevail over the general
obligations.
This model code of conduct shall be reviewed by the Board from time to time so as to keep in pace with
the regulatory environment and any amendments to this Code, shall be approved by the Board of Director.
11. Applicability:
The Directors both executive and non executive, are obliged to carry out their duties in an honest, fair,
diligent and ethical manner, within the scope of the authority conferred upon them and in accordance
with the laws, rules, regulations, agreements, guidelines, standards and internal policies and procedures.
The Board of Directors of the Company is entrusted with the fiduciary responsibility of oversight of the
affairs of the Company. As Directors of the Company, they have a duty to make decisions and implement
policies in the best interest of the Company and its members.
The Code of Conduct is applicable to:
The Directors, both executive and non-executive Directors.Senior Management team comprising members
of Management one level below the Executive Directors, including all functional heads.

8
III. Honest & Ethical Conduct:
The Directors & Senior Management personnel are required to act in accordance with the highest standards
of personal and professional integrity, honestly, ethical and legal conduct, when acting on behalf of the
Company or in connection with the Company’s business or operations and at social events.

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INCAP LIMITED

8
An honest conduct is considered as such when a conduct is free from fraud or deception. We consider
ethical conduct to be conduct conforming to the accepted professional standards of conduct and include
ethical handling of actual or apparent conflicts of interest between personal and professional relationships.
The Directors and the Senior Management personnel shall
Act honestly, fairly, ethically, with integrity and loyalty and conduct themselves in a professional, courteous
and respectful manner;
Act in the best interest of the Company and in a manner to enhance and maintain the reputation of the
Company, and fulfill their fiduciary duties to the members of the Company;
Act in good faith, with responsibility, due care, competence, diligence and independence;
Treat their colleagues and other associates of the Company with dignity and shall not harass any of them
in any manner.
IV. Code of Interest:
General Guidance
The Directors and Senior Management personnel are expected to avoid and disclose any activity or
association that creates or appears to create a conflict between the personal interests and the Company’s
business interests. A Conflict of interest exists where the interests or benefits of one person or entity
conflict with the interest or benefits of the Company. Relationships with prospective or existing suppliers,
contractors, customers, competitors or regulators must not affect the independent and sound judgment
on behalf of the Company. General guidelines to better understand several of the most common examples
of situations that may cause a conflict of interest are listed below. Directors and the senior management
personnel are required to disclose to the Board any situation that may be, or appear to be, a conflict of
interest. When in doubt, Disclose.
a. Outside Employment:
Executive Directors and Senior Management personnel shall not work for or receive payments for services
from any competitor, customer, distributor or supplier of Incap without approval of the Board. Any
outside activity must be strictly separated from Incap employment and should not harm job performance
at Incap. The Executive Directors and the Senior Management personnel shall devote themselves
exclusively to the business of the Company and shall not accept any other work or assignment (part time
or otherwise).
b. Board Memberships:
Serving on the Board of Directors or a similar body of any other company or organization other than this

8 company or government agency requires the advance approval of the Board of Directors, Acceptance of
Directorship on the Boards of other Companies, which compete, with the Company amounts to conflict
of interest and hence should not be accepted. Helping the community by serving on Boards of nonprofit
or welfare organizations is encouraged, and does not require prior approval.

65
INCAP LIMITED
c. Family Members and Close Personal Relationships:
8
Directors and Senior Management personnel shall not use personal influence to make the Company do
business with a company/ institution which do not belong to the same group in which his or her relatives
are interested. As a general rule, Directors and Senior Management personnel shall avoid conducting
Company’s business with a relative or with an entity in which a relative is associated in any significant
role. In case of conflicts, be it a Director or Senior Management cadre, disclosure shall be made to the
Board of Directors and a prior approval shall be obtained.
d. Gifts (Gifts are not always physical objects they might also be services, favors or other items of value)
The Directors and Senior Management personnel shall not accept lavish gifts or gratuities or any offer,
payment, promise to pay, or authorization to pay any money, or anything of value that could be interpreted
to adversely affect business decisions or likely to compromise their personal or professional integrity.
Gift items of nominal value, such as small promotional items bearing another company’s name, business
meals, gifts received because of personal relationships and not because of official position, mementos
received because of attending a widely held gatherings as panelist/ speaker and other customary gifts are
allowed. Gifts on behalf of the Company – Some business situations call for giving gifts. These gifts
shall be legal and reasonable. Directors and Senior Management personnel shall not pay bribes. It is
understood that gift-giving practices vary among cultures and countries. Directors and Senior Management
personnel shall not provide any gift if law or the policy of the recipient’s organization prohibits it. For
example, the associates of many government entities around the world are prohibited from accepting
gifts.
e. Investments:
Directors and Senior Management personnel may not allow their investments to influence, or appear to
influence, their independent judgment on behalf of the Company. This could happen in many ways, but
it is most likely to create the appearance of a conflict of interest if a Director or Senior Manager has a
significant investment in a competitor, supplier, customer, or distributor and his decisions may have a
business impact on this outside party. The Directors and Senior Management personnel shall seek prior
consent of the Board before making any investments more than 5% of the paid up capital of the other
entity.
f. Diversion of Business:
Directors and Senior Management personnel shall not divert business opportunities of the Company, by
exploiting for their own personal gain, business opportunities that are discovered through the use of
corporate propriety information or position. However the Directors and Senior Management personnel
can pursue such business opportunities once they are fully disclosed to the company and the company

8 declined to pursue such opportunities.

g. Use of Company’s Assets:
The Assets of the Company shall be used for legitimate business purposes and shall not be used for
personal purposes. Incidental personal use, if reasonable, does not amount to violation of the code.
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INCAP LIMITED
h. Others:
8
It would be impracticable to attempt to list all possible conflict of interest’s situations and it is possible
that other such situations, which are not enumerated above, may arise
10. DECLARATION BY CHAIRMAN AND MANAGING DIRECTOR ON CODE OF CONDUCT
UNDER THE SECURITIES AND EXCHANGE BOARD OF INDIA (LISTING OBLIGATIONS
AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015 (LISTING REGULATIONS)

To

The Members

I, hereby declare that to the best of my knowledge and information, all the Board Members and Senior
Management Personnel have affirmed compliance with the code of conduct for the year ended March
31, 2018.

For and on behalf of the Board

VIJAYAWADA
26 May, 2018
C.BHAGAVANTHA RAO
MANAGING DIRECTOR
DIN: 00218713

8
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INCAP LIMITED

To
CEO / CFO CERTIFICATION 8
The Board of Directors
Incap Limited

I had reviewed the financial statements, read with the cash flow statement of Incap Limited for the
year ended 31st March, 2018 and that to the best of our knowledge and belief, we state that:
a) These statements do not contain any materially untrue statement or omit any material fact or contain
statements that might be misleading.
b) These statements together present a true and fair view of the company’s affairs and are in compliance
with existing accounting standards, applicable laws and regulations.
a) There are, to the best of their knowledge and belief, no transaction entered into by the company
during the year which are fraudulent, illegal or violative of the company’s code of conduct.
b) They accept responsibility for establishing and maintaining internal controls for financial reporting
and that they have evaluated the effectiveness of internal control systems of the company pertaining
to financial reporting and they have disclosed to the auditors and the audit committee, deficiencies
in the design or operation of such internal controls, if any, of which they are aware and the steps
they have taken or propose to take to rectify these deficiencies.
c) They have indicated to the auditors and the audit committee:-
i. Significant changes, if any, in the accounting policies during the year and that the same have been
disclosed in the notes to the financial statements; and
ii. Instances of significant fraud of which they have become aware and the involvement therein, if
any, of the management or an employee having a significant role in the company’s internal control
system over financial reporting.

For INCAP LIMITED

C.BHAGAVANTHA RAO
MANGING DIRECTOR
VIJAYAWADA DIN: 00218713
26 May, 2018

8
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INCAP LIMITED
ANNEXURE – E
AUDITORS CERTIFICATE ON CORPORATE GOVERNANCE
8
To

The Members of
INCAP LIMITED

We have examined the compliance of conditions of corporate governance by INCAP LIMITED, for the
year ended on 31st March, 2018 as stipulated in the Securities and Exchange Board of India (Listing
Obligations and Disclosure requirements) Regulations, 2015 (‘ Listing Regulations) of the said company
with stock exchange(s).
The Compliance of conditions of corporate governance is the responsibility of the management. Our
examination was limited to procedures and implementation thereof, adopted by the company for ensuring
the compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression
of opinion on the financial statements of the company.
In our opinion and to the best of our information and according to the explanations given to us, we
certify that the company has complied with the conditions of Corporate Governance as stipulated in the
above mentioned Listing Regulations.
We further state that such compliance is neither an assurance as to the future viability of the company
nor the efficiency or effectiveness with which the management has conducted to affairs of the company.

For K.V.V.PRASAD & CO.,

Chartered Accountants,
Firm Regn. No.002758S

(CA. K.V.V.PRASAD )
Proprietor
M.No.026708
VIJAYAWADA
26 May, 2018

8
69
INCAP LIMITED
ANNEXURE – F
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis presented in this Annual Report focuses on the theme of
8
‘Faster, Higher and Stronger’ which was the Company-wide initiative to continue on the path of profitable
growth. The company has got the profit before tax Rs. 2.85 Crores during the year. The organization
structure, various strategies followed and processes implemented, along with excellent team-work, a
strong management and leadership has enabled the Company to move forward on the path of profitable
growth.
Overall Business Review
Incap Limited is a 25-year-old focused Company, with interests in the Manufacturing and Production of
Capacitors and Insulators. The costs of inputs in key raw materials continued to escalate, thereby affecting
the material costs adversely. The industry witnessed intense competition for market share and significant
pressures on margins and profits. The Company continued its focus on enhancing revenue growth. Various
actions in terms of cost reduction, value engineering, competitive sourcing and improving credit discipline
have been undertaken. There has been a significant progress in the Industry.
Industry structure and developments:
In India the demand for Electrolytic Capacitor is around 4 to 5 billion capacitors (approx) in all segments.
The total production in India for this component is negligible, since the market is either in the hands of
Chinese or Japanese due to mass scale and quality product of Japanese. The output in the Indian
Industry would be hardly 150 m pcs per annum.
The cost factor is also a major constraint in determining the sale since we are banking for all raw
materials sources either from China or Japan and our raw materials are totally imported since there is
hardly any supplier big enough to support even a small rubber bung in India. Backward Integration is
negligible.
There is a hope that the Indian Industry has an upper hand to manufacture and support the local Industry
and that too in segments like LED since this is going to have a market for the next, one decade is the
analyst view further the cost of all things in China and Japan is likely to be high even the Labor. So India
could be their next destination.
Anyhow progress and growth would be not less than 10% since there is umpteen area of vacuum by
which we can improve our sale.
The competition like any other Industry we will face tough times on pricing from the Chinese but
everything can be overcome with quality and faster delivery. Presently anyhow Chinese and Japanese
have the maximum share in the Electrolytic Capacitor market.

8
Opportunities and threats:
We have been focusing on the Business to Business oriented businesses. After having established ourselves
amongst the top few companies in the entire market Endeavour to establish ourselves with more growth
and performance.

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INCAP LIMITED

8
Due to the strong linkage of the manufacturing industry to the economy, such an event would adversely
impact growth in the short term for the Company.
Competition: Competition whether domestic is always a challenge and transforming challenges into
opportunities has been a practice at Incap.
Cost of Raw material: Aluminum Foil, Aluminum Cans, Lead Tabs, Electrolyte being a major raw
material to our business, its cost may affect our contribution margins. Company had adopted various
measures to minimize the effect of escalating prices of raw material.
The new initiatives will bring new challenges in near future. We believe that we have sufficient
management bandwidth to pass through these cycles with past experiences.
Outlook:
Domestic economic indicators are expected to improve, led by positive prospects in Government Spending
and several government schemes. Indian economic activity is expected to improve modestly, driven by
global economic revival and moderation in inflation. Upside pressures on inflation and consumption,
hinge on the vagaries of the monsoon and the pace of revival of the investment climate will determine to
a very large extent India’s economic performance, going forward.
Manufacturing and Government spending are expected to grow, its’ an opportunity for the Industry, in
general and for your Company, in particular.
Risks and areas of concern:
Taking risk is an inherent part of entrepreneurial behavior. A structured risk management process
encourages management to take risks in controlled manner. In order to provide a comprehensive view of
business activities, risks are identified in a structured way combining elements of a top-down and bottom-
up approach. Risks are reported on a regular basis as part of the “Business Performance Management”
process. All relevant risks and opportunities are prioritized in terms of impact and likelihood, considering
quantitative and/ or qualitative aspects. The bottom-up identification and prioritization process is supported
by conducting workshops with the respective management at Factory and Corporate function level. This
top-down approach ensure that potential risks and opportunities are discussed on management level and
are included in the subsequent reporting process, if found to be applicable.
Company has a structured risk management process to address different risk categories:
Strategic, Operational, Compliance and Financial risks
Strategic Risks: As Company’s business is completely domestic; its business environment is influenced
by economic conditions. Factors like fluctuation of energy & raw material price, intellectual property
rights, product awareness & brand recognition etc. are part of its strategic risk management. Product
creation process and/ or increased speed in innovation to market is important for profitable and growth

8 ambitions.
Operational Risks: Ensuring timely delivery of new solutions and products at lower cost and upgrading
of customer service levels to create sustainable competitive advantage and effective supply chain
management is very much required amongst other things, to enhance time to market & product quality.

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INCAP LIMITED

8
Compliance Risks: Company’s presence exposes the Company to regional and local regulatory laws,
rules and regulations, which may interfere with the realization of business opportunities operates.
Strengthening internal control, corporate governance & IT systems play vital role in mitigation of
compliance risks.
Financial Risks: Corporate control, together with respective functional management, performs an
assessment of Financial Reporting risk at appropriate interval or at least annually. Risk Mitigation to
mitigate the aforesaid risks have been identified and addressed under the supervision of a team of Senior
management.
The Company is in process of reviewing existing policies & procedures and developing/ documentation
of Standard Operating Procedures (SOP) for all requisite processes. This will facilitate better control,
uniformity & efficiency across various processes of the organization.
Internal control systems and their adequacy:
The Company believes that good corporate governance is the adoption of best business practices which
ensure that the Company operates not only within the regulatory framework but is also guided by ethics
and a strong belief in the tradition of trust.
The following committees are in place to ensure effective corporate governance:
i. Board of Directors
ii. Audit Committee
iii. Remuneration Committee
iv. Shareholders Grievance Committee
Material developments in Human Resources/ Industrial Relations front, including number of people
employed
The Company believes that its human resource has played the most important role in enabling the Company
to embark upon a more prosperous future. The Company has invested on its human resource by providing
appropriate training and developmental inputs along with career progress opportunities to deserving
employees.
The Company’s focus on having good people related processes in terms of recruitment, training,
performance appraisal and performance rewards have been well received by all the employees.
Cautionary Statement:
Statements in the Management Discussion and Analysis, describing the Company’s strategies on business,
projections and estimates, are forward-looking statements. The actual results may vary from those
expressed or implied, depending upon economic conditions, Government policies, regulations, tax laws
and other incidental factors.

8
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