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A.K.Capital Services Ltd.

BSE: 530499 Sector: Financials
NSE: N.A. ISIN Code: INE701G01012
BSE LIVE 15:40 | 28 Apr 425.00 1.10
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OPEN 423.90
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VOLUME 1086
52-Week high 458.00
52-Week low 211.00
P/E 11.72
Mkt Cap.(Rs cr) 280.50
Buy Price 0.00
Buy Qty 0.00
Sell Price 425.00
Sell Qty 50.00
OPEN 423.90
CLOSE 423.90
VOLUME 1086
52-Week high 458.00
52-Week low 211.00
P/E 11.72
Mkt Cap.(Rs cr) 280.50
Buy Price 0.00
Buy Qty 0.00
Sell Price 425.00
Sell Qty 50.00

A.K.Capital Services Ltd. (AKCAPITALSERV) - Director Report

Company director report

To the Members of A. K. Capital Services Limited

The Directors of your Company present the 23rd Annual Report on the businessoperations and state of affairs of your Company along with the audited statement ofaccounts for the financial year 2015-16.

FINANCIAL HIGHLIGHTS

A summary of the financial performance of the Company both on consolidated andstandalone basis for the financial year 2015-16 as compared to the previous financialyear is given below:

Consolidated financial highlights of A. K. Capital Services Limited and itssubsidiaries

(Rs. in Crore except per share data)
Particulars 2015-16 2014-15
Total income 245.62 254.67
Total expenditure 186.15 195.57
Profit before tax 59.47 59.10
Provision for taxes 17.60 17.64
Profit after tax 41.87 41.46
Less: Share of minority interest and adjustment on account of further 0.32 0.32
investment in Subsidiary Company
Profit f or the year 41.55 41.14
Add: Surplus brought forward from previous year 275.05 245.29
Less: Adjustment in accordance with the transitional provisions - 0.54
of the Schedule II of the Act
Less: Transfer of Pre-acquisition profit 0.06 -
Profit available for appropriation 316.54 285.89
Less: Appropriations
Proposed dividend 3.96 3.96
Transfer to general reserves 1.90 1.90
Transfer to special reserves 4.34 4.19
Dividend distribution tax 0.81 0.79
Surplus carried to the Balance Sheet 305.53 275.05
Earnings per equity share (face value Rs. 10/- per share)
Basic (Rs.) 62.95 62.34
Diluted (Rs.) 62.95 62.34

Standalone financial highlights of A. K. Capital Services Limited

(Rs. in Crore except per share data)
Particulars 2015-16 2014-15
Total income 71.97 97.66
Total expenditure 44.69 69.97
Profit before tax 27.28 27.69
Provision for tax 8.71 9.39
Profit after tax 18.57 18.30
Add: Surplus brought forward from previous year 221.87 210.72
Less: Adjustment in accordance with the transitional provisions of the Schedule II of the Act - 0.50
Profit available for appropriation 240.44 228.52
Less: Appropriations
Proposed dividend 3.96 3.96
Transfer to general reserves 1.90 1.90
Dividend distribution tax 0.81 0.79
Surplus carried to the balance sheet 233.78 221.87
Earnings per equity share (face value Rs. 10/- per share)
Basic (Rs.) 28.14 27.74
Diluted (Rs.) 28.14 27.74

FINANCIAL PERFORMANCE AND STATE OF AFFAIRS OFTHE COMPANY

The consolidated turnover of your Company stood at Rs. 245.62 Crore for the financialyear ended March 31 2016 as against Rs. 254.67 Crore for the previous year. Theconsolidated Profit before tax is Rs. 59.47 Crore for the current year as against Rs.59.10 Crore in the previous year. After making provision for tax the consolidated netProfit of your Company is Rs. 41.87 Crore as against Rs. 41.46 Crore in the previous year.

On standalone basis your Company earned gross income of Rs. 71.97 Crore during theyear under review as against Rs. 97.66 Crore reported in the previous year. The Profitbefore tax is Rs. 27.28 Crore as against the Rs. 27.69 Crore during the previous year.After making provision for tax the net Profit of your Company is Rs. 18.57 Crore asagainst the net Profit of Rs. 18.30 Crore in the previous year.

DIVIDEND ON EQUITY SHARES

The Board of Directors are pleased to recommend a final dividend of 60% i.e. Rs. 6/-per equity share (on the face value of Rs. 10/- per equity share) on 6600000 equityshares for the financial year 2015-16. The amount of dividend on equity shares and taxthereon aggregates to Rs. 4.77 Crore.

The payment of the final dividend is subject to the approval of the members which isbeing sought at the forthcoming Annual General Meeting and shall be paid to those memberswhose names appear in the Register of Members as on Monday September 12 2016. TheRegister of Members and Share Transfer Books will remain closed from Tuesday September13 2016 to Saturday September 17 2016 both days inclusive. The Annual General Meetingof the Company is scheduled to be held on Saturday September 17 2016.

TRANSFERTO RESERVES

The Company proposes to transfer Rs. 1.90 Crore to the General Reserve.

SUBSIDIARIES

As on March 31 2016 your Company had 5 subsidiaries viz. A. K. Stockmart PrivateLimited A. K. Capital Corporation Private Limited A. K. Wealth Management PrivateLimited A. K. Capital (Singapore) Pte. Ltd. and A. K. Capital Finance Private Limited.

On consolidated basis your Company posted consolidated revenue of Rs. 245.62 Crore anda consolidated Profit after tax (after minority interest and adjustment on account offurther investment in subsidiary company) of Rs. 41.55 Crore.

The Consolidated Financial Statements has been prepared under the historical costconvention on accrual basis and in accordance with the Generally Accepted AccountingPrinciples (GAAP) in compliance with the provisions of the Companies Act 2013 (the Act)including the Accounting Standards specified under Section 133 of the Act read with Rule7 of the Companies (Accounts) Rules 2014 and forms part of this Annual Report.

In terms of Section 129(3) of the Act read with Rule 5 of Companies (Accounts) Rules2014 and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 aStatement containing salient features of financial statements of subsidiaries in FormAOC-1 as prescribed in the Companies (Accounts) Rules 2014 forms a part and is annexed tothe Annual Report

The financial statements of the subsidiary companies have been placed on the website ofthe Company www.akcapindia.com. Any member interested in obtaining a copy of financialstatement of the subsidiaries may write to the Company Secretary at the Registered Officeof the Company.

MATERIAL SUBSIDIARIES

In accordance with SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 the Company has one material non listed subsidiary. The Policy for determining thematerial subsidiaries has been formulated and adopted by the Board. The Policy may beaccessed on the Company's website at link:http://www.akcapindia.com/WebSiteDocuments/Policy%20for%20Determining%20Material%20Subsidiary.pdf

DIRECTORS AND KEY MANAGERIAL PERSONNEL

As on March 31 2016 the Board of Directors of your Company comprised of six Directorsof which two are Executive Directors one Woman Director who is a Non-ExecutiveNon-Independent Director and three are Non-Executive Independent Directors. The Chairmanof the Company is Non-Executive Independent Director and 50% of the total numbers ofDirector are Independent Directors. The composition of the Board is in consonance withSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and inaccordance with the applicable provisions of the Companies Act 2013 as amended from timeto time.

In accordance with the Articles of Association of the Company and the provisions of theSection 152 of the Companies Act 2013 Mr. Deepak Mittal (DIN: 00043685) though appointedas a Whole Time Director for a fixed term of 5 years with effect from April 1 2015 willretire by rotation at the ensuing Annual General Meeting and being eligible offershimself for re-appointment to enable compliance by the Company with the provisions ofSection 152 of the Companies Act 2013.

The following persons are the Key Managerial Personnels (KMPs) of the Company as perthe provisions of the Companies Act 2013 (the Act) as on March 31 2016:-

Mr. A. K. Mittal - Managing Director
Mr. Deepak Mittal - Whole-time Director
Mr. Mahesh Bhootra - Chief Financial Officer
Ms. Kanchan Singh Mehta - Company Secretary

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of Independence prescribed both under the CompaniesAct 2013 and the requirements of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.

EVALUATION OFTHE PERFORMANCE OFTHE BOARD

The Board has framed an Evaluation Policy (the Policy) for evaluating the performanceof the Board Chairman Managing Director Whole-time Director Independent DirectorsNon-Executive Director and its Committees. Based on the same the performance wasevaluated for the financial year ended March 31 2016. A meeting of the IndependentDirectors was held during the year under review.

The Policy inter alia provides the criteria for performance evaluation such asBoard effectiveness quality of discussion contribution at the meetings business acumenstrategic thinking time commitment relationship with the stakeholders corporategovernance practices contribution of the Committees to the Board in discharging itsfunctions etc.

NOMINATION AND REMUNERATION POLICY

The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection of Directors determining Directors independence and paymentof remuneration to Directors Key Managerial Personnel and other employees. The Nominationand Remuneration Policy is attached as Annexure - 1 to this Report. The details ofthe Nomination and Remuneration Committee are stated in the Report on CorporateGovernance.

BOARD COMMITTEES

The Board of Directors have constituted four Committees viz.

1. Audit Committee

2. Stakeholders Relationship Committee

3. Nomination and Remuneration Committee

4. Corporate Social Responsibility Committee

Details of all the Committees along with their composition terms of reference andmeetings held during the year are provided in Report on Corporate Governance forming partof the Annual Report.

AUDIT COMMITTEE OFTHE COMPANY

The Company's Audit Committee comprises the following Directors:

Sr. Name of the Members DIN Designation
1 Mr. Subhash Chander Madan 00785025 Chairman (Independent Director)
2 Mr. Raghubinder Rai 00851994 Member (Independent Director)
3 Mr. A. K. Mittal 00698377 Member (Managing Director)

The composition of the Audit Committee is in compliance with the requirements ofSection 177 of the Companies Act 2013 and with SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 entered into with the Bombay Stock Exchange (BSE).

NUMBER OF MEETINGS OFTHE BOARD

The Board meets at regular intervals to discuss and decide on the Company's policiesand business performance apart from other Board matters. The notice for the Board Meetingis given well in advance to all the Directors.

During the financial year 2015-16 v e Board Meetings were held on April 16 2015 May24 2015 August 14 2015 November 7 2015 and February 11 2016. The gap between the twoboard meetings did not exceed 120 days.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(5) of the Companies Act 2013 withrespect to Directors Responsibility Statement it is hereby confirmed that:

1. in preparation of the annual financial statements for the financial year 2015-16the applicable accounting standards have been followed and there are no materialdepartures from the same;

2. the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2016 and of the Profit ofthe Company for the financial year 2015-16 ended on that date;

3. the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

4. the Directors have prepared the annual accounts on a going concern basis;

5. the Directors have laid down proper internal financial controls to be followed bythe Company and that such financial controls are adequate and are operating effectively;

6. the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that the systems are adequate and are operating effectively.

CORPORATE SOCIAL RESPONSIBILITY

In accordance with the provisions of Section 135 of the Companies Act 2013 the Boardof Directors of the Company has constituted the Corporate Social Responsibility Committee(CSR Committee) and the CSR Committee has formulated and recommended to the Board aCorporate Social Responsibility Policy (CSR Policy) indicating the activities to beundertaken by the Company which has been approved by the Board.

The CSR Policy may be accessed on the Company's website at the link:http://www.akcapindia.com/WebSiteDocuments/CSR_Policy.pdf

During the year under review the Company has not undertaken any activity andinitiative on CSR (Annexure - 2)

WHISTLEBLOWER POLICY AND ESTABLISHMENT OFVIGIL MECHANISM

In accordance with the provisions of Section 177 of the Companies Act 2013 and SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the Company hasestablished Vigil Mechanism and also adopted a Whistleblower Policy under the surveillanceof the Audit Committee. The Company has adopted work culture which ensures higheststandards of professionalism honesty integrity moral and ethical behavior. The Policymay be accessed on the Company's website at the link:www.akcapindia.com/WebSiteDocuments/Whistle%20Blower%20Policy%20and%20Establishment%20of%20Vigil%20Mechanism.pdf

POLICY FOR PREVENTION PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT OFWOMENATWORKPLACE

In accordance with the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013 the Company has adopted a Policy on Prevention Prohibition andRedressal of Sexual Harassment of Women at Workplace. During the financial year 2015-16 nocases in the nature of sexual harassment were reported at any work place of the Company.

MANAGEMENT DISCUSSION & ANALYSIS AND CORPORATE GOVERNANCE REPORTS

The Management Discussion and Analysis for the financial year 2015-16 and the report ofthe Directors on Corporate Governance as required under SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 are given in separate sections forming part ofthe Annual Report.

A certificate from the Statutory Auditors of the Company M/s. Suresh Surana &Associates LLP Chartered Accountants (Firm Registration No. 121750W/W-100010) confirmingcompliance with the conditions of Corporate Governance stipulated under SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 is annexed to the Report onCorporate Governance.

INTERNAL FINANCIAL CONTROLS

The Internal Financial Controls with reference to financial statements as designed andimplemented by the Company are adequate.

RISK MANAGEMENT AND INTERNAL CONTROLS

The Company has a well-defined risk management framework and maintains adequateinternal control systems. The Risk Management and Internal Control System thereof arediscussed in detail in the Management Discussion and Analysis report that forms part ofthe Annual Report.

STATUTORY AUDITORS

M/s. Suresh Surana & Associates LLP Chartered Accountants (Firm Registration No.121750W/W-100010) Mumbai Statutory Auditors of your Company retire at the ensuingAnnual General Meeting and being eligible offer themselves for re-appointment. The Companyhas received a confirmation from M/s. Suresh Surana & Associates LLP CharteredAccountants (Firm Registration No. 121750W/W-100010) to the effect that theirappointment if made would be within the limits prescribed under Section 139 of theCompanies Act 2013 and the rules framed thereunder and that they satisfy the criteriagiven under Section 141 of the Companies Act 2013.

The Audit Committee and Board of Directors have recommended the re-appointment of M/s.Suresh Surana & Associates LLP Chartered Accountants (Firm Registration No.121750W/W-100010) as the Statutory Auditors of your Company.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act 2013 and the rules madethereunder the Company has appointed M/s Aashish Bhatt & Associates (C.P. No: 2956)Practicing Company Secretary to conduct the Secretarial Audit of the Company. TheSecretarial Audit Report is appended as Annexure - 3 to this Report.

PUBLIC DEPOSITS

During the financial year 2015-16 your Company did not invite or accept any publicdeposits.

PARTICULARS OF LOANS GUARANTEE AND INVESTMENTS BYTHE COMPANY

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in Notes to the Financial Statements.

RELATED PARTYTRANSACTION

All contracts /transactions entered by the Company during the year with related partieswere on an arms length basis. The Company has complied with the provisions of section 188of the Companies Act 2013 read with rule of Companies (Meetings of Board and its Powers)Rules 2014 and the amendments made thereto from time to time.

The particulars of contracts or arrangements with related parties referred to inSection 188(1) as prescribed in Form AOC - 2 are appended as Annexure - 4 to thisreport.

The details of related party transactions carried out by the Company are also set outin note no.31 to the Financial Statements.

In accordance with the provisions of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company has formulated a Policy on Materiality andDealing with Related Party Transactions. It can be accessed on the Company website at thelink:http://www.akcapindia.com/WebSiteDocuments/Policy%20on%20Materiality%20and%20Dealing%20with%20Related%20Party%20Transactions.pdf

MATERIAL CHANGES AND COMMITMENTS AFFECTINGTHE FINANCIAL POSITION OFTHE COMPANY

During the year under review there were no material changes and commitments affectingthe financial position of the Company which have occurred between the end of the financialyear of the Company to which the financial statements relate and the date of this Report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS AND COURTS

During the financial year 2015-16 the Company received an Order from the RegionalDirector Northern Region Ministry of Corporate Affairs dated March 17 2016 for approvalof shifting of the Registered Office address of the Company. The Registered Office of theCompany has been shifted to 403 4th Floor East Wing Tulsiani Chambers Free PressJournal Marg 212 Nariman Point Mumbai 400021.

CONSERVATION OF ENERGYTECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

In view of the nature of activities which are being carried on by the Company theparticulars as prescribed under Section 134(3)(m) of the Act read with Companies(Accounts) Rules 2014 regarding Conservation of Energy and Technology Absorption andresearch and development are not applicable to the Company.

Your Company has no foreign exchange earnings during the financial year 2015-16. Theinformation on foreign exchange outgo is furnished in the Notes to the FinancialStatements under note no. 28 which forms part of this Annual Report.

TRANSFER OF AMOUNTSTO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provisions of Section 205A(5) and 205C of the Companies Act 1956relevant amounts which remained unpaid or unclaimed for a period of 7 years have beentransferred by the Company to the Investor Education and Protection Fund. Pursuant to theprovisions of Investor Education and Protection Fund (Uploading of information regardingunpaid and unclaimed amounts lying with companies) Rules 2012 the Company has uploadedthe details of unpaid and unclaimed amounts lying with the Company as on September 192015 (date of last Annual General Meeting) on the website of the Company(www.akcapindia.com) as also on the Ministry of Corporate Affairs website.

EXTRACT OF ANNUAL RETURN

Pursuant to the requirements under Section 92(3) and Section 134(3) of the CompaniesAct 2013 read with Rule 12 of Companies (Management and Administration) Rules 2014 anextract of Annual Return in prescribed Form MGT - 9 is given in the Annual Report as

Annexure 5.

PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section197(12) of the Companies Act 2013 read with Rule 5 of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are provided in the Annual Report and isattached as Annexure - 6 and forms an integral part of this Report.

In terms of the provisions of Section 197(12) of the Companies Act 2013 read withRules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is available for inspection by the Members at the RegisteredOffice of the Company between 2.00 p.m. to 4.00 p.m. on any working day (Monday to Friday)upto the date of 23rd Annual General Meeting of the Company. Any Member who is interestedin obtaining such information may write to the Company Secretary and the same will befurnished on such request.

ACKNOWLEDGEMENT

Your Directors would like to express their appreciation for the assistance andco-operation received from the Government Authorities Regulators Stock ExchangesBankers of the Company Other Statutory Bodies etc. during the year under review. YourDirectors would also like to take this opportunity to express their gratitude to theMembers of the Company for their trust and support. The Board also wishes to thank theemployees of the Company and its subsidiaries at all levels for the dedicated servicesrendered by them. Your Directors look forward to your continuing support.

On behalf of the Board of Directors
A. K. Mittal Deepak Mittal
Managing Director Whole-time Director
(DIN: 00698377) (DIN: 00043685)
Date: August 12 2016
Place: Mumbai