DIRECTORS' REPORT:

To

The Members

The Directors have pleasure in presenting the Directors' Report and audited statement of accounts of the Company for the period ended on March 31, 2016.

2. Operations: The total Income during the year went up by over 10 % over the previous year. The profit before finance costs, depreciation and tax (EBITDA) increased to Rs.1317.72 Lacs from Rs. 1152.51 Lacs in the previous year.

There are no material changes and commitments which affect the financial position of the Company as on the date of this report since March 31, 2016.

There was no change in the nature of the business during the year under review.

3. Dividend: The Directors are pleased to recommend a Dividend for the period ended March 31, 2016 @ Rs. 0.70 per share on 50,00,000 Equity Shares for financial year 2015-2016 amounting to Rs. 35.00 Lacs as against Rs. 0.50 per share, amounting to Rs. 25.00 Lacs for last financial year 2014-2015, subject to approval of the members at this Annual General Meeting.

4. Research & Development: Product Development and Process Improvements actively continued during the year.

5. Wind Power Project: The Company's two Wind Turbine Generators are operating satisfactorily.

6. Director and Key Managerial Personnel: The Details of re-appointment of the Director:

Smt. Vishakha P. Tamboli (DIN 06600319) retires by rotation as required by the Companies Act, 2013, and being eligible, offers herself for re-election.

The particulars of Directors/employees and the remuneration paid to directors is given in the Annexure to the Directors' Report as required under section 197 (12) of the Companies Act, 2013

7. Declaration from Independent Directors: The Company has received necessary declaration from each Independent Director of the Company under section 149 (7) of the Companies Act, 2013 that the Independent Director of the Company meet with the criteria of their Independence laid down in Section 149 (6).

8. Audit Committee: The Audit Committee comprises Independent Directors namely Shri Akshay R. Shah (Chairman), Shri J. M. Mapgaonkar, Shri Girish C. Shah and Shri Piyush I. Tamboli as other Members. All the recommendations made by the Audit Committee were accepted by the Board.

9. Policy laid down by the Nomination and Remuneration Committee for remuneration of Directors, Key Menegarial Persons (KMP) and other employees and the criteria formulated by the committee for determining qualifications, positive Attributes, Independence of a Director. Please refer Annexure A attached to this report.

10. Vigil Mechanism: The Vigil Mechanism of the Company, which also incorporates a whistle blower policy in terms of the Listing Agreement, includes an Ethics & Compliance Task force comprising senior executives of the Company. Protected disclosures can be made by a whistle blower through an e-mail, or telephone line or a letter to the Chairman of the Audit Committee. The policy on vigil mechanism and whistle blower policy may be accessed on the Company's website at the address www.ipcl.in

11. Directors' Responsibility Statement: Your Directors confirm that:

a) in the preparation of the annual accounts, the applicable accounting standards read with requirements set out under Schedule III to the Companies Act, 2013, have been followed and there are no departure from the same;

b) they have selected prudent accounting policies;

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

d) they have prepared the annual accounts on a 'going concern' basis;

e) They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

12. Information about the Financial Performance/Financial Position of the Subsidiary: The

summary information on the balance sheet of the subsidiary company is given in this annual report on Page No. 64.

13. Extract of Annual Return: Eextract of Annual Return of the Company is annexed herewith as Annexure B to this report.

14. Secretarial Audit Report: The Board has appointed CS Alpesh Dhandhalya, practising company secretary,of CS Alpesh Dhandhalya & Associates, Companies Secretaries, Ahmedabad, to conduct Secretarial Audit for the financial year 2015-2016. The Secretarial Audit Report for the financial year ended March 31, 2016 contains no reservation and remarks.

A copy of this report issued by CS Alpesh Dhandhalya & Associates, Companies Secretaries, Ahmedabad is enclosed as Annexure C with this report.

15. Significant and Material orders passed by the Regulators: During the year there were no orders passed by the regulators which affected the going concern of the Company's operation, present and future.

16. Internal Financial Controls: The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

17. Particulars of Loans given, Investments made, Guarantees given and Securities provided:

Particulars of loans given, investment made along with the purpose for which the loan is proposed to be utilised by recipient are provided in the standalone financial statement. (Please refer to note 11, 12, 16 and 33 to the standalone statement).

18. Risks Management Policy: The Company manages, and monitors on the principal risks and uncertainties that can impact its ability to achieve its objectives.

19. Corporate Social Responsibility Policy and annual report on CSR: In pursuant to the provisions of section 135 and schedule VII of the Companies Act, 2013, CSR Committee of the Board of Directors was formed to recommend (a) the policy on Corporate Social Responsibility (CSR) and (b) implementation of the CSR Projects or Programs to be undertaken by the Company as per CSR Policy for consideration and approval by the Board of Directors.

The Company has made certain activities under the CSR project on voluntarily basis as the company is not falling under the defined criteria applicable to the company under the Companies  Act, 2013.

20. Related Party Transactions: All contracts/arrangements/transactions entered during the financial year with related parties were in the ordinary course of the business and on arm's length basis. During the year, the company had not entered into any contract/arrangement/transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.

Your Directors draw attention of the members to Note 33 to the Standalone financial statement which sets out related party disclosures.

21. Cost Audit: The Cost audit is presently not applicable to the company according to the revised guideline for limit of turnover for cost audit under the Companies Act, 2013 as amended.

22. Listing with Stock Exchanges: The Company is listed on The Bombay Stock Exchange Ltd. (BSE) since 1976. The company has paid listing fees to BSE for 2015-15 and 2016-17.

23. Corporate Governance and Shareholders Information: The Company has complied with amended clause of listing agreement concerning strength of independent directors on the Board before March 31, 2016.

24. Secretarial Standards: The Company has complied with amended secretarial standards.

25. Segment Reporting: As all the manufacture is of one class of products, segment wise reporting of the results is not applicable to your Company.

26. Accounting for Taxes on income: Deferred Tax Liability of Rs. 31.66 Lacs, resulting from application of the Accounting Standard AS-22, has been debited to the amount available for appropriation for the current Financial Year, 2015-2016.

27. Management Discussion & Analysis: The Management Discussion & Analysis is also enclosed.

28. Auditors:

The members will be requested at this Meeting to appoint Auditors and fix their remuneration. M/s. Sanghavi & Co., the existing Auditors, are eligible for re-appointment.

29. General: Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

a) Details relating to deposits covered under Chapter V of the Companies Act, 2013.

b) No significant or material orders were passed by the Regulations or Courts or Tribunals which impact the going concern status and Company's operations in future.

Your Directors further state that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

30. Appreciation: The Directors thank the Bankers, Bank of Baroda, and the concerned authorities of the Government for their co-operation, and also record their appreciation for the efforts put in by the  employees.

ON BEHALF OF THE BOARD OF DIRECTORS

Piyush I. Tamboli

CHAIRMAN & MANAGING DIRECTOR

DIN 00146033

Registered Office: Nari Road, Bhavnagar Gujarat 364 006 Dated May 4, 2016