DIRECTORS' REPORT

Dear Shareholders,

1. The Directors of your company have immense pleasure in presenting Directors' Report together with audited financial results of the company for the year ended 31st March 2015.

AUDITED FINANCIAL RESULTS

2. DIVIDEND

With a view to repair past losses which resulted in erosion of reserves and conservation of resources for future betterment, the Board of Directors do not recommend any dividend for the year.

3. STATE OF COMPANY'S AFFAIRS

Financial Year 2014-15

In-spite of various odds, your company's efforts to reduce costs and improve margins through product-mix optimization and introduction of new grades bore fruits.

Consequently, your company has turned in better financial performance during the year.

Your company reported a post tax Profit of 15.54 Crores vis-a-vis a loss of Rs. 22.08 Crores for FY 2013-14.

Expectations for FY 2015-16

There is still surplus supply particularly in writing and printing grades. There has been increase in Power and Coal cost. Your company is working on further cost-rationalization in order to maintain its financial performance.

4. ANNUAL- RETURN EXTRACTS

Extracts of the Annual Return as provided in Section 92(3) of the Companies Act, 2013 in MGT-9 is attached as Annexure-I

5. BOARD MEETINGS/AUDIT COMMITTEE

a) During the year 2014-15, five (5) Board meetings were held on 19.05.2014, 13.08.2014, 27.09.2014, 10.11.2014, 11.02.2015.

b) Audit Committee-

The Company has the Audit Committee of the Board pursuant to Section 177 of the Companies Act, 2013 and its terms of reference are in conformity with Clause 49 of the listing agreement. The composition of the Audit Committee is given in attached Corporate Governance Report.

6. VIGIL MECHANISM FOR DIRECTORS AND EMPLOYEES

Pursuant to Section 177 of the Companies Act, 2013, the company has established a 'Vigil Mechanism' for directors and employees to report their genuine concerns to the company. The company oversees this 'Vigil Mechanism' through the Audit Committee of the Board.

7. ENVIRONMENT, POLLUTION CONTROL AND SAFETY

Your company is a committed corporate entity which emphasizes on providing healthy environment and safe working conditions. Accredited with ISO 14001: 2004, ISO 9001 : 2008 & ISO 18001 :2007, the company has integrated quality and environment management systems which harmonize operations with environmental preservation. Necessary environmental clearances from Government authorities are in place.

Your company has yet again won Gold Award for environmental excellence in Paper Industry presented by Greentech Foundation reflecting commitment of the company to preserve environment and providing safe work conditions.

8. SOCIAL FARM FORESTRY

The company has been promoting and encouraging tree plantation program under social farm forestry. This also helps in enhancing rural incomes and facilitate sustain availability of raw material to the company. The scheme involves supply of high quality clones/seedlings apart from providing technical assistance to the farmers.

The program also maintained its momentum during the year too and your company further stepped-up propagation and distribution of clonal plants and the area coverage.

9. FIXED DEPOSITS

The company has not invited any fixed deposits during the year and as such there has been no default in repayment of deposit or payment of interest thereon during the year. There were no outstanding fixed deposits as on 31st March, 2015. (Rs. Nil as on 31st March, 2014).

The company is in compliance with provisions of the Companies Act, 2013 and rules made thereunder in respect of deposits.

10. INTERNAL CONTROLS

The company has adequate internal control system in place on the basis of which financial accounting is done and periodically financial statements are prepared. Such Internal control systems are adequate and operating effectively.

11. REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR)

As the company has been incurring losses until last year, it was not obligatory upon the company to form a CSR committee pursuant to Section 135 of the Companies Act, 2013 and the Rules made there under.

12. DIRECTORS

i) Mr. K.N Bhandari (DIN-00191219) appointed as an Independent Director w.e.f 27th Sept., 2014 has resigned from directorship w.e.f the close of working hours on 31st March, 2015 due to some other preoccupation towards pursuing other interests and certain other commitments.

ii) Ms. Savita Laxmipathy Acharya (DIN-07038198), {a woman director under Clause 49} has been appointed as additional director (Independent) of the company w.e.f. 31st March, 2015.

iii) Sh. S.V Goenka (DIN-00030375) is retiring by rotation at the ensuing Annual General Meeting and being eligible, offer himself for re-appointment

The independent directors have given declarations that they meet the criteria of independence under section 149(6) of the Companies Act, 2013. The company's familiarization program for Independent Directors are posted on website of the company and can be accessed at <http://www.starpapers.com/familarisation_prog.pdf>

13. NOMINATION AND REMUNERATION COMMITTEE/POLICY

The Board of Directors has constituted a 'Nomination & Remuneration Committee' which follows the company's policy on directors' appointment and remuneration including criteria for determining qualification, independence of a director and other matters provided under section 178 (3) of the Companies Act, 2013.

The gist of company's policy on nomination and remuneration is as under:

The Committee shall consider ethical standards of integrity, qualification, expertise and experience for appointment of Directors/KMP etc. and recommend to the Board of Directors. Directors/ KMP etc shall be appointed as per the procedure laid down in applicable laws.

The Committee will recommend the remuneration to be paid to Directors/KMP etc requiring Committee approval as per statutory provisions. The level and composition of remuneration so determined by the Committee shall be reasonable and sufficient to attract, retain and motivate the appointee(s).

14. LOAN, GUARANTEE, INVESTMENTS ETC.

The company has not given any loan or guarantee or provided security in connection with a loan to any other body corporate during the year.

15. PARTICULARS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Particulars regarding energy conservation, technology absorption and foreign exchange earnings/outgo pursuant to Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 are furnished as Annexure-II to this Report.

16. PARTICULARS OF EMPLOYEES AND REMUNERATION

Information in accordance with the provisions of Section 134(3)(q) and Section 197(12) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 regarding employees' remuneration are given hereunder:

17. PERFORMANCE EVALUATION

The company has in place a Policy on performance evaluation of Independent Directors, Board, Committees and individual Directors. The Board of Directors evaluates its own performance in terms of operations of the company, financial results etc. The performance of Committee(s) is evaluated by the Board based on effectiveness of committee, its functioning and decisions etc. The Board also reviews the performance of individual director(s) based on the contribution of the individual director to the Board/ committee meetings, participation in discussions, inputs given in the meeting.

18. HUMAN RESOURCES AND WELFARE

Your company has a structured approach to manage its human resources in line with changing needs of the organisation. Industrial relations remained harmonious during the year.

Your Directors further state that during the year under review, there was no case reported under the Sexual Harassment of woman at work place (Prevention, Prohibition and Redressal) Act, 2013

19. DIRECTORS' RESPONSIBILITY STATEMENT

As required under the provisions of Section 134(5) of the Companies Act, 2013 the Board wishes to confirm that:

1. In preparation of accounts, applicable accounting standards have been followed .

2. Such accounting policies as were reasonable and prudent were selected in preparing the accounts and these were applied consistently. Further judgements and estimates that were reasonable and prudent were also made in the course of preparing the accounts so as to give a true and fair view of the Company's state of the affairs as at the end of the financial year and its profit for financial year ended 31st March, 2015.

3. Proper and sufficient care was taken for the maintenance of proper accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities.

4. The accounts have been prepared on going concern basis.

5. The directors had laid down internal financial controls to be followed by the company and such internal financial controls are adequate and operating effectively.

6. The directors had devised proper system to ensure compliance with the provisions of all applicable laws and with aid down internal financial controls to be followed by the company and such system are adequate and operating effectively

20. CORPORATE GOVERNANCE

A separate report on corporate governance, along with a certificate from the statutory auditors confirming the compliance with corporate governance requirements has been annexed as Annexure-IV to Directors' Report.

21. AUDITORS

M/s Lodha & Co. Chartered Accountants, retires at the ensuing Annual General Meeting. They have expressed their willingness to continue in office, if appointed and have furnished the requisite certificate of their eligibility pursuant to the provisions of the Companies Act, 2013.

22. AUDITORS' REPORT

I) StatutoryAudit:

The qualification of the Auditors in their report read with relevant note on the financial statements as mentioned below is self-explanatory:

-Excess managerial remuneration amounting to Rs. 21.57 lacs payable to managerial personnel for FY 2011-12 is subject to approval of Central Government.-Note No. 23.1 of Statement of Profit & Loss.

ii) Secretarial Audit:

M/s D. Dutt & Co., company secretary in practice, secretarial auditor of the company for FY 2014-15 has competed secretarial audit for FY 2014-15. A secretarial audit report is attached as Annexure-V.

23. TRANSACTIONS WITH RELATED PARTIES

All contracts / arrangements / transactions entered by the company during the financial year with related parties were in the ordinary course of business and on an 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. Information pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure VI in Form AOC-2 and the same forms part of this report.

24. RISK MANAGEMENT COMMITTEE

Your Directors have enlarged mandate of Audit Committee to include responsibility to assist the Board in (i) overseeing and approving the company's enterprise wide risk management framework; and (ii) periodic appraisal to assess any change needed in the context of changing business environment

25. LISTING ON STOCK EXCHANGES

Your company's equity shares are listed on National Stock Exchange of India Ltd. (NSE) and The Stock Exchange, Mumbai (BSE). The company has paid the listing fees to the stock exchanges for the financial year 2014-15.

26. ACKNOWLEDGEMENTS

Your Directors are pleased to place on record their gratitude for the excellent support and efforts put in by the employees, bankers, investors, dealers, suppliers and Government Departments.

For and on behalf of the Board

G. P. Goenka

Chairman

Place : New Delhi

Date : 20th May , 2015