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Arambhan Hospitality Services Ltd.

BSE: 539403 Sector: Services
NSE: N.A. ISIN Code: INE800S01017
BSE 00:00 | 23 Apr Arambhan Hospitality Services Ltd
NSE 05:30 | 01 Jan Arambhan Hospitality Services Ltd
OPEN 27.50
PREVIOUS CLOSE 27.50
VOLUME 25000
52-Week high 78.90
52-Week low 20.00
P/E
Mkt Cap.(Rs cr) 14
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 27.50
CLOSE 27.50
VOLUME 25000
52-Week high 78.90
52-Week low 20.00
P/E
Mkt Cap.(Rs cr) 14
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Arambhan Hospitality Services Ltd. (ARAMBHANHOSPIT) - Director Report

Company director report

DIRECTORS' REPORT

To

The Members

Arambhan Hospitality Services Limited

(Formerly known as Cawasji Behramji Catering Services Limited)

We are delighted to present the report on our business and operations for the yearended March 31 2017.

FINANCIAL PERFORMANCE

A summary of your Company's financial performance is given below:

(Rs. in '000')

Particulars For the F.Y. ended March 31 2017 For the F.Y. ended March 31 2016
Audited Audited
INCOME
Revenue from Operations 237134.26 709764.01
Other Income 5860.90 13.247.85
Total Income 242995.16 723011.86
EXPENDITURE
Raw Materials consumed 127471.07 433590.68
Employee Benefit Expenses 53054.73 120351.36
Other Expenses 64480.42 118551.88
Total Expenditure 245006.22 672493.92
Profit/Loss before Interest & Depreciation (2011.06) 50517.94
Finance costs 30930.07 23721.44
Depreciation and amortization expense 5526.70 8612.68
Profit/Loss before exceptional and extraordinary items and Tax (38467.83) 18183.82
Exceptional and Extraordinary items - -
Profit/Loss before Tax (38467.83) 18183.82
Tax - Current Tax 312.70 6702.86
Profit/Loss after Tax (38780.53) 11480.96
Basic/Diluted Earnings per equity share (7.76) 2.30

FINANCIAL HIGHLIGHTS

During the year 2016-2017 the total revenue of our company decreased to INR 24 29 95160/- as against INR72 30 11860 in the year 2015-16 representing a decrease inapproximately 66.39 % of the revenue from the operations.

MATERIAL CHANGES AND COMMITMENT AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments affecting the financial position of theCompany which has occurred between the end of the financial year of the Company i.e. March2017 and the date of Director's Report.

CONSOLIDATED FINANCIAL STATEMENT

In terms of Section 129 of the Companies Act 2013 your Company has preparedConsolidated Financial Statements of the Company and its wholly-owned subsidiary companyCBCS International Limited. The Consolidated Financial Statements along with statementcontaining the salient features of the Financial Statements of CBCS International Limitedin the prescribed Form AOC - 1 forms part of this Annual Report. as Annexure III. TheConsolidated Financial Statements of the Company shall be laid before the ensuing 8thAnnual General Meeting of the Company along with the Standalone Financial Statements ofthe Company.

STATE OF AFFAIRS OF THE COMPANY

The operating performance of your Company has been covered in the Management Discussionand Analysis Report which forms part of this Annual Report.

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis Report for the year under review as stipulatedunder Listing Regulations forms part of this Annual Report in Annexure VI.

CHANGE IN THE NATURE OF BUSINESS

There has been no change in the nature of business of the Company during the year underreview.

RESERVES

During the year 2016-2017 the total Reserves & Surplus of our company decreased toINR 40469910 as against INR 79250440 in the year 2015-16.

DIVIDEND

Your Director considers it prudent to conserve the resources of the Company and hencedo not recommend Dividend on Equity shares for the financial year under review.

DETAILS OF SUBSIDIARY COMPANY

CBCS International Limited was incorporated by the Company in Financial Year 2015 - 16with a view to exploring various possibilities to expand into the Catering HousekeepingFacilities Management and Restaurant space including Offshore and Remote sites in theMiddle-east.

During the year under review CBCS International Limited had not commenced its businessoperations and hence your Directors are not commenting on its performance and contributionto the overall performance of the Company as required in terms of Section 134(3)(q) readwith Rule 8(1) of the Companies (Accounts) Rules 2014.

CHANGES IN SHARE CAPITAL

During the year under review the paid-up Share Capital of the Company was INR50000000/- comprising of 5000000 Equity Shares of the Company of INR 10/- each.Hence there being no change in the Share Capital of the Company for the Financial Year2016-17.

HUMAN RESOURCE DEVELOPMENT & TRAINING

As the Company's mission statement states we believe in creating invaluablerelationship with all our Stakeholders viz; Suppliers Customers Lenders Shareholdersand Employees. Human Resources continue to be the most valuable assets for your Company.The Company's recruitment strategy ensured that employee addition was clearly aligned tobusiness demand and their eligibility. Your Company strives to help its employees growprofessionally and to give them opportunities to accomplish their career goals. Alsoconstant efforts are in place towards creating and maintaining an enthusiastic workculture to give an equal opportunity to demonstrate their potential towards achieving thecorporate goals and objectives. Your Company undertakes induction and staff welfareprogrammes for their employees and helps in built their inner strengths and abilities.

PARTICULARS OF EMPLOYEES

There were no employee employed throughout the financial year who was in receipt ofremuneration of INR 1.02 crore or more or employed for part of the year and in receipt ofINR 8.5 lakh or more a month as mentioned under Rule 5(2) and 5(3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014.

BOARD OF DIRECTORS

The Board of Directors of the Company is not duly constituted with proper balance ofExecutive Directors and Independent Directors. The Company is required to appoint 2Independent Directors in terms of provisions of Companies Act 2013 due to change incomposition of Directors. The Company is in the process of search of suitable candidatesfor the post of Independent Director. The Company will soon appoint the IndependentDirectors to meet the requirement.

MEETINGS OF THE BAORD

Your Directors report that the regular meetings of the Board are held to discuss anddecide on various business policies strategies and other businesses. The Board met 5(Five) times during the financial year 2016-17:

a. May 09 2016

b. May 30 2016

c. August 29 2016

d. November 14 2016

e. March 11 2017

Number of meeting attended by each Director:

Sr. No. Name of Directors Number of Meetings held Board meeting attended
1. Alfred Micheal Arambhan 05 05
2. Nalini Maria Arambhan 05 05
3. Pooja Alfred Arambhan 05 05
4. Yateen Madhukar Chodnekar 05 04
5. Abhijit Pradhan 05 05
6. Lekh Raj Assanand Sardana 05 01
7. John Philipose 05 03
8. Shashank More 05 04

MEETINGS OF THE COMMITTEE

i. Audit Committee #

The Audit Committee comprises Mr. Shashank More (Chairman) Mr. Abhijit Pradhan and Mr.Alfred Micheal Arambhan as Members. All the recommendations made by the Audit Committeewere accepted by the Board.

The Audit Committee met twice during the financial year under review. The meetings ofthe Committee were held on May 30 2016 and November 14 2016.

The attendance of each Director at the said Committee Meetings is given below:

Name of the Directors No. of Committee Meetings Held No. of Committee Meetings attended
Mr. Shashank More (Chairman) 2 2
Mr. Abhijit Pradhan 2 2
Mr. Alfred Micheal Arambhan 2 2

#Note: Mr. Shashank More Non Executive Independent Director of the Companyresigned on 09.03.2017 and hence The Board in its Meeting held on 11.03.2017 reconstitutedthe Audit Committee. The composition of Audit committee as on the date of the reportstands as follows:

Name of the Director Category
Mr. Abhijit Pradhan Chairman
Mr. Lekhraj Assanand Sardana Member
Mr. Alfred Micheal Arambhan Member

ii. Nomination and Remuneration Committee #

The Nomination and Remuneration Committee comprises Mr. Abhijit Pradhan (Chairman) Mr.JohnPhilipose and Mr. Shashank More as Members.

The Nomination and Remuneration Committee met twice during the financial year underreview. The meeting of the Committee was held on 14th November 2016 and 2ndMarch 2017

The attendance of each Director at the said Committee Meetings is given below:

Name of the Directors No. of Committee Meetings Held No. of Committee Meetings attended
Mr. Abhijit Pradhan (Chairman) 2 2
Mr. Shashank More 2 2
Mr. John Philipose 2 0
Mr. LekhRaj Assanand Sardana 2 1

# Note: Mr. John Philipose Non Executive Independent Director of the Company resignedon 02.11.2016 and hence The Board in its Meeting held on 14.11.2016 reconstituted theNomination & Remuneration Committee. The composition of Nomination & Remunerationcommittee as on the date of the report stands as follows*:

Name of the Director Category
Mr. Abhijit Pradhan Chairman
Mr. Lekhraj Assanand Sardana Member

*Shashank More Non Executive Independent Director of the Company resigned on09.03.2017 and hence there is requirement of appointment of 1 (One) Non ExecutiveIndependent Director in order to have a proper Board composition as per Regulation 17 ofSEBI (LODR) Regulations 2015 and also to comply with the provisions of Section 178 ofCompanies Act 2013 and Regulation 19 of SEBI (LODR) Regulations 2015 in terms ofcomposition of Nomination & Remuneration Committee.

iii. Stakeholders Relationship Committee

The Stakeholders Relationship Committee comprises Mr. Abhijit Pradhan (Chairman) Mr.Alfred Micheal Arambhan and Ms. Pooja Alfred Arambhan as Members. During the financialyear 2016-17 no meeting of the Stakeholders Relationship Committee was held.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS ANDEXPENDITURE

Since your Company does not own any manufacturing facility the particulars relating toconservation of energy and technology absorption stipulated in the Section 134(3)(m) ofthe Companies Act 2013 the Companies (Accounts) Rules 2014 are not applicable. Thedetails of foreign exchange earnings and expenditure of your Company appear in the Notesto Accounts.

EXTRACT OF ANNUAL RETURN

Pursuant to sub-section 3(a) of Section 134 and sub-section (3) of Section 92 of theCompanies Act 2013 read with Rule 12 of the Companies (Management and Administration)Rules 2014 the extracts of the Annual Return as at March 31 2017 forms part of thisreport as Annexure I.

FIXED DEPOSITS

The Company has not accepted fixed deposits from public within the purview of Section74 of the Companies Act 2013 during the year.

CONTRACTS OR ARRANGEMENTS WITH THE RELATED PARTIES

In terms of the provisions of the Companies Act 2013 and as per Regulation 23 of SEBI(LODR) Regulations 2015 your Company has put in place a Board approved 'Related PartyTransaction Policy' for the purpose of proper approval and reporting of transactions withrelated parties. During the year under review your Company had not entered into anyRelated Party Transactions covered within the purview of Section 188(1) of the CompaniesAct 2013 accordingly requirement of disclosure of Related Party Transactions in termsof Section 134(3)(h) of the Companies Act 2013 in Form AOC - 2 is not applicable to theCompany. All other transactions with related parties were in compliance with the RelatedParty Transaction Policy of the Company and the Company had during the year under reviewnot entered into transactions with related parties which could be considered to be'material' in accordance with the 'Related Party Transaction Policy' of the Company.

LOANS GUARANTEES OR INVESTMENTS IN SECURITIES

The Company has granted Loan amounting to INR 4491080/- under Section 186 to itswholly owned subsidiary CBCS International Limited. The same is within the permissiblelimit under Section 186 and the approval for the same was being granted by the Board inits Meeting held on May 30 2016.Applicable disclosures in terms of the Securities andExchange Board of India (Listing obligations and Disclosure Requirements) Regulations2015 as on March 31 2017 are given at Annexure II .

VIGIL MECHANISM

In terms of requirements of Section 177 of the Companies Act 2013 read with Rules madethereunder the Company has formulated a codified Whistle Blower Policy / Vigil Mechanismin order to encourage anyone connected with the Company to come forward and express ingood faith genuine concerns about unethical and improper practices or any other wrongfulconduct in the Company without fear of punishment victimization or unfair treatment.

The Vigil Mechanism provides a channel to report to the management concerns aboutunethical behavior actual or suspected fraud or violation of various codes or policies ofthe Company and provides adequate safeguards against victimization of persons who use suchmechanism. The Mechanism provides for direct access to the Chairman of the Audit Committeein appropriate or exceptional cases. The Whistle Blower Policy / Vigil Mechanism isavailable on the website of the Company.

DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

Pursuant to the provisions of Section 152 of the Companies Act 2013 Mrs. Nalini MariaArambhanExecutive Director (DIN: 02168429) retires by rotation at the ensuing AGM andbeing eligible offers herself for re-appointment. Brief profile of Executive Directorproposed to be re-appointed and as aforesaid is provided in the Exhibit in the Notice ofAnnual General Meeting forming part of this Annual Report.

Rajiv Mudaliar resigned as Whole-time Key Managerial Personnel of the Company under thecategory of Chief Financial Officer with effect from 23rd August 2016.

John Philipose resigned as Non-Executive Independent Director of the Company witheffect from 02nd November 2016. The Board of Directors at its meeting held on14th November 2016 appointed Lekhraj Assanand Sardana (DIN: 07652004) as AdditionalNon-Executive Independent Director of the Company subject to the approval of theshareholders. A notice has been received from a Member proposing Lekhraj Assanand Sardana(DIN: 07652004) as a Candidate for the office of Non-Executive Independent Director of theCompany. Brief profile of Lekhraj Assanand Sardana (DIN: 07652004)proposed to beregularized as Non-Executive Independent Director is provided in the Exhibit in the Noticeof Annual General Meeting forming part of this Annual Report.

Shashank Suresh More resigned as Non-Executive Independent Director of the Company witheffect from 09th March 2017.

The Board of Directors of the Company in its meeting held on 14th November2016 appointed Ms. Pooja Alfred Arambhan Director of the Company as also Whole-time ChiefFinancial Officer of the Company.

DECLARATION BY INDEPENDENT DIRECTOR

The Company has received necessary declaration from each Independent Directors underSection 149(7) of the Act that he meets the criteria of independence laid down in Section149(6) of the Companies Act 2013 and Listing Regulations.

INDEPENDENT DIRECTORS' MEETING

The Independent Directors met on March 30 2017 without the attendance of Non-Independent Directors and members of the Management. The Independent Directors interalia reviewed the performance of Non-Independent Directors and the Board as a whole; theperformance of the Chairman of the Company and assessed the quality quantity andtimeliness of flow of information between the Company Management and the Board that isnecessary for the Board to effectively and reasonably perform their duties.

PERFORMANCE EVALUATION

In terms of the provisions of the Companies Act 2013 the Board adopted a formalmechanism for evaluating its performance and as well as that of its Committees andindividual Directors. In order to assist the Board to carry out such evaluation processthe Board has adopted a Board Performance Evaluation Policy which defines the process tobe followed for performance evaluation of the Board its Committees and individualDirectors. In order to prescribe detailed criteria manner and process for evaluation ofperformance of the Board its Committees and Directors the Nomination

and Remuneration Committee of the Board formulated and adopted the 'PerformanceEvaluation Process - Board Committees and Directors' which forms an integral part of theBoard Performance Evaluation Policy.

The manner in which formal annual evaluation of the Board its Committees andindividual Directors is conducted includes:

• The Independent Directors at their separate Meeting review the performance ofNon-Independent Directors and the Board as a whole.

• The Nomination and Remuneration Committee evaluates the performance of theDirectors on the Board. A feedback on the overall evaluation conducted by the Nominationand Remuneration Committee is communicated to the Board.

• Then in light of the criteria prescribed in the Board Performance EvaluationPolicy the Board analyses its own performance that of its Committees and each Directorduring the year and suggests changes or improvements if required.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act 2013 the Board of Directors of theCompany confirms that-

1. In preparation of the Annual Accounts the applicable accounting standards have beenfollowed along with proper explanations;

2. The Directors had 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 31st March 2017 and ofthe profit or loss of the company for that period;

3. The Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;

4. The Directors had prepared the Annual Accounts on a going concern basis;

5. The Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively;

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

AUDITORS Statutory Auditors:

S S Rathi & Co. Chartered Accountants (Firm Registration No. 108726W) wereappointed as the Statutory Auditors of your Company at the 7th Annual General Meeting ofthe Company held on September 27 2016 to hold office for a period of 5 years from theconclusion of the said Annual General Meeting till the conclusion of the 12th AnnualGeneral Meeting of the Company subject to ratification by Members at every Annual GeneralMeeting. In terms of the requirements of Section 139 of the Companies Act 2013 theappointment of the Statutory Auditors of the Company is required to be ratified by theMembers at every Annual General Meeting of the Company.

Appointment of S S Rathi & Co. Chartered Accountants (Firm Registration No.108726W) as Statutory Auditors to hold office from the conclusion of the 8th AnnualGeneral Meeting till the conclusion of the 9th Annual General Meeting of the Company isplaced for ratification by the Members at the ensuing Annual General Meeting.

S S Rathi & Co. Chartered Accountants (Firm Registration No. 108726W) StatutoryAuditors in their report(s) on the Annual Audited Standalone Financial Statements andAnnual Audited Consolidated Financial Statements of your Company for the Financial Yearended March 31 2017 have not submitted any qualifications reservations or adverse

remarks or disclaimers. During the year under review the Statutory Auditors have notreported any incident of fraud to the Audit Committee. Members are requested to refer theIndependent Auditor's Report annexed herewith for more details.

SECRETARIAL AUDITOR

Pursuant to Section 204 of the Companies Act 2013 the Board has appointed M/s.Abhishek Lakhotia & Co. Practising Company Secretaries as its Secretarial Auditors toconduct the Secretarial Audit of the Company for the financial year 2016-17.

The Secretarial Audit Report for the financial year ended March 31 2017 does notcontain any qualification reservation and adverse remark and is annexed to this report asAnnexure VII.

ADEQUACY OF INTERNAL FINANCIAL CONTROL WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has in place adequate internal financial controls with reference tofinancial statements. During the year no reportable material weakness in the design oroperation was observed in the internal financial controls.

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee'sremuneration and other details as required pursuant to Section 197(12) of the CompaniesAct 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is annexed to this Report as Annexure V.

None of the Directors of the Company are in receipt of any commission from the Companyor from any Subsidiary of the Company.

The details of remuneration paid to the Directors of the Company are given in 'Annexure1' to this Report.

SIGNIFICANT & MATERIALS ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNAL

There are no significant material orders passed by the regulators or courts ortribunals which would impact the going concern status and company's operations in future.

RISK MANAGEMENT POLICY

Pursuant to the requirement of Section 134 of the Companies Act 2013 the Company hasalready in place a Risk Management Policy. The Company has a robust Risk Managementframework to identify and evaluate business risks and opportunities. The framework seeksto create transparency minimise adverse impact on the business objectives and enhance theCompany's competitive advantage.

NOMINATION AND REMUNERATION POLICY

The Nomination and Remuneration Policy recommended by the Nomination and RemunerationCommittee is duly approved by the Board of Directors of the Company and is annexed to thisReport as Annexure IV.

The Company for the year under review has not paid any remuneration by way ofcommission and sitting fees to NonExecutive Directors.

DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION& REDRESSAL) ACT 2013

In terms of the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 your Directors have constituted an InternalComplaints Committee and adopted a 'Care and Dignity Policy'.

During the year under review no complaints related to sexual harassment had beenreceived by the Internal Complaints Committee.

ACKNOWLEDGEMENTS

Your Directors place on record their gratitude for the continuing support of clientsCharterers stakeholders Shareholders Investors bankers consultants and advisorsvarious Government authorities & departments Port trust authorities and Businessallies &associates for their continuous support and co-operation at all levels.

The Board further places on record its appreciation for the dedicated services renderedby the employees of the Company.

Date: 01st September 2017 On Behalf of Board of Directors
Place: Mumbai Sd/-
Alfred Micheal Arambhan
Chairman & Managing Director