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BCL Enterprises Ltd.

BSE: 539621 Sector: Financials
NSE: N.A. ISIN Code: INE368E01015
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BCL Enterprises Ltd. (BCLENTERPRISES) - Director Report

Company director report

To

The Members of

BCL Enterprises Limited

Your Directors are pleased to present the Annual Report on the business and operationsof the Company together with the Audited Financial Statements for the financial yearended 31st March 2015.

1. BACKGROUND

The Company is a Non Deposit Accepting Non Banking Finance Company ("NBFC")holding a Certificate of Registration from the Reserve Bank of India ("RBI")received on February 28 2000.

2. STATE OF COMPANY’S AFFAIR

The Company is in the business of financing activities with the expected positivemomentum in the Global economy the business of the Company is expected to increase withthe increasing rate of growth. The Company is focused on growth and achievingprofitability along with a renewed commitment to enhance quality and customer service andto reduce costs. Investment and positive modifications are expected in the near futureboosting the Company's revenues.

3. FINANCIAL HIGHLIGHTS

Revenue for the current year is Rs. 50.23 Lac as compared to Rs. 7.78 Lac in theprevious year the ultimate increase in Revenue of 545.88%; Profit before tax for thecurrent year is Rs. 14.02 Lac as compared to Rs. 1.60 Lac in the previous year theultimate increase in PBT of 776.25%; Profit after tax for the current year is Rs. 8.24 Lacas compared to Rs. 1.10 Lac in the previous year the ultimate increase in PAT of 446.25%.

4. FINANCIAL RESULTS

The Company’s financial results are as under:

Particulars For The Year Ended
31st March 2015 31st March 2014
(Rs.) (Rs.)
Total Revenue (I) 5023163 778887
Total Expenses (II) 3620827 618411
Profit Before Tax & Extraordinary Item 1402336 160476
Tax Expenses 577923 49782
Profit After Tax 824413 110694
Less: Transfer to Statutory Reserves u/s 45- IC(1) of Reserve Bank of India Act 1934 164883 22139
Contingent Provisions against Standard Assets 145200 44400
Profit/(Loss) transferred to Balance Sheet 514330 44155
Earning Per Share (Rs.) 0.141 0.111

FINANCIAL PERFORMANCE OF THE SUBSIDIARIES:

As on 31st March 2015 the Company is having two Wholly Owned Subsidiaries i.e.

a. Paavak Infrastructure Limited;

b. BCL Developers Limited.

The operations and financials of the wholly owned subsidiaries are summarised as under:

Particulars Paavak Infrastructure Limited BCL Developers Limited
31st March 2015 (Rs.) 31st March 2014 (Rs.) 31st March 2015 (Rs.) 31st March 2014 (Rs.)
Total Revenue (I) NIL NIL 74860 NIL
Total Expenses (II) 21317 33260 72680 14700
Profit Before Tax & Extraordinary Item (21317) (33260) 2180 (14700)
Tax Expenses (1988) 7950 NIL NIL
Profit After Tax (23305) (25310) 2180 (14700)
Profit/(Loss) transferred to Balance Sheet (23305) (25310) 2180 (14000)
Earning Per Share (Rs.) (0.47) (0.51) 0.22 (1.47)

5. RESERVES

An amount of Rs. 164883/- being 20% of the profits was transferred to StatutoryReserve Account for the financial year ended 31st March 2015 as per the requirement ofNBFC prudential norms.

6. DIVIDEND

As the Company needs further funds to enhance its business operations to upgrade theefficiency and to meet out the deficiencies in working capital the Directors do notrecommend any dividend on Equity Shares for the financial year 2014-15.

7. BUSINESS RISK MANAGEMENT

Risk Management is an integral part of the Company’s business strategy. The RiskManagement oversight structure includes Committees of the Board and Senior ManagementCommittees. The Audit Committee of the Board reviews compliance with risk policiesmonitors risk tolerance limits reviews and analyzes risk exposure related to specificissues and provides oversight of risk across the organization. The Audit Committeenurtures a healthy and independent risk management function to inculcate a strong riskmanagement culture in the Company.

As part of the Risk Management framework the management of Credit Risk Market RiskOperational Risk and Fraud Risk are placed under the Head-Risk to ensure Integrated RiskManagement for various Risks.

8. INTERNAL FINANCIAL CONTROL

The Company’s internal control system is designed to ensure operationalefficiency protection and conservation of resources accuracy and promptness in financialreporting and compliance with laws and regulations. The internal control system issupported by an internal audit process for reviewing the adequacy and efficacy of theCompany’s internal controls including its systems and processes and compliance withregulations and procedures.

The Company’s internal control system is commensurate with the size nature andoperations of the Company.

9. VIGIL MECHANISM / WHISTLE BLOWER POLICY

To review the matters relating to fraud risk including corrective and remedial actionsas regard people and processes the Company has formulated a vigil mechanism policy whichshall also safeguard the directors and employees from victimization who report theirgenuine concern relating to actual or suspected fraud unethical behaviour violation ofthe Company’s Code of Conduct or Ethical Policies and any other event which wouldadversely affect the interests of the business of the Company and which is under directcontrol of the Audit Committee of the Company. The said policy has also posted on thewebsite of the Company.

10. HUMAN RESOURCES

The Company recognizes people as its most valuable asset and it has built an opentransparent and meritocratic culture to nurture this asset. The Company has kept a sharpfocus on Employee Engagement.

The Company’s Human Resources is commensurate with the size nature and operationsof the Company.

11. COMPLIANCE

The Company has complied with all applicable provisions of the Companies Act 2013 andthe RBI Act 1934 Listing Agreement executed with the Stock Exchanges and otherapplicable rules/regulations/guidelines issued from time to time.

12. DEPOSITS

The Company has neither invited nor accepted any deposits from the public during theyear. There is no unclaimed or unpaid deposit lying with the Company.

13. DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP) APPOINTED / RESIGNED DURINGTHE YEAR

S. No. Name DIN/PAN Designation Date of Appointment Change
1. Sushil Kumar Sharda 00303835 Director Proposed to be re- appointed as Director retire by rotation in the ensuing AGM
2. Umesh Kumar 02968410 Independent Director 28/08/1992 Appointed as Independent Director w.e.f. 17/04/2015.
3. Sangita 06957418 Independent Director 26/08/2014 It is proposed to re- designate her to non- executive non- independent Director in the ensuing AGM.
4. Jeevan Singh Rana 07017869 Independent Director 17/04/2015 --
5. Mahendra Kumar Sharda 00053042 Managing Director 09/05/1993 Appointed as MD w.e.f. 17/04/2015
6. Kishore Kargeti AQZPK6943M Chief Financial Officer 19/03/2015 --
7. Anuj Rastogi AXYPR3145E Company Secretary and Compliance Officer 24/09/2014 --

Brief resume of the Directors proposed to be appointed in ensuing Annual GeneralMeeting nature of their expertise in functional areas and the name of the publiccompanies in which they hold the Directorship and the Chairmanship/Membership of theCommittees of the Board are given as Annexure to the Notice convening the Annual GeneralMeeting.

14. DECLARATION GIVEN BY INDEPENDENT DIRECTOR

The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet with the criteria of independence as prescribed undersub-section (6) of Section 149 of the Companies Act 2013.

15. BOARD EVALUATION

Pursuant to the provisions of the Companies Act 2013 the Board has carried out anannual performance evaluation of its own performance the Directors individually as wellas the evaluation of the working of its Audit Nomination & Remuneration Committeesand Shareholder Grievance Committee. The manner in which the evaluation has been carriedout is based on the criteria as specified by the management of the Company i.e. No. ofmeetings attended quality suggestion accepted by the Board from the individual Directorparticipation of Directors in Board discussion etc.

16. CHANGE IN THE NATURE OF BUSINESS

There were no changes in the nature of business of the Company during the financialyear 2014-15.

17. DISCLOSURE UNDER RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION) RULES2014

i) The ratio of the remuneration of each Director to the median remuneration of theemployees of the Company for the financial year:

Directors Ratio to median remuneration*
Mr. Sushil Kumar Sharda NIL
Mr. Umesh Kumar NIL
Mr. Jeevan Singh Rana NIL
Mr. Mahendra Kumar Sharda NIL
Ms. Sangita NIL

* Directors do not receive any remuneration sitting fees or commission from theCompany.

ii) Except Company Secretary no remuneration was paid to any Director of the Company ina FY 2014-15. Further there is no increase in the salary of Company Secretary during theyear.

iii) The percentage increase in the median remuneration of employees in the financialyear: Median remuneration of employees for the current year is Rs. 200780/- per year ascompared to Rs. 102000/- per year in the previous year the ultimate increase in medianremuneration of employees is 96.84%.

iv) The number of employees on the rolls of Company as on 31st March 2015 is Seven(7).

v) The relationship between average increase in remuneration and Company performancecannot be explained as no remuneration paid to the Directors in the relevant period.

vi) Comparison of the remuneration of the key managerial personnel against theperformance of the Company:

Particulars Amount (Rs.)
Aggregate remuneration of key managerial personnel (KMP) in FY2014-15 116600
Revenue 5023163
Percentage of remuneration of KMP as compare to the revenue of the Company 2.32%
Profit before Tax (PBT) 1402336
Percentage of remuneration of KMP as compare to the Profit Before Tax of the Company 8.31%

vii) The shares of the Company are listed on Metropolitan Stock Exchange of India Ltd(formerly MCX Stock Exchange Limited) and the shares are infrequently traded thereforevariations in the market capitalization of the Company cannot be determine. Further thenet-worth of the Company in the current financial year is Rs. 5.97 Crore as compared toRs.1.07 Crore in the previous financial year.

viii) There was an increase of 20% in current year in the salaries of employees fromthe previous year and there was no increase in remuneration paid to the Key ManagerialPersonnel. Hence the comparison between the two cannot be made.

ix) Comparison of each remuneration of the key managerial personnel against theperformance of the Company:

Mr. Anuj Rastogi Company Secretary
Particulars Amount (Rs.)
Aggregate remuneration of key managerial personnel (KMP) in FY2014-15 116600
Revenue 5023163
Percentage of remuneration of KMP as compare to the revenue of the Company 2.32%
Profit before Tax (PBT) 1402336
Percentage of remuneration of KMP as compare to the Profit Before Tax of the Company 8.31%

x) As no remuneration has been paid to the Directors during the year there are no keyparameters for any variable component of remuneration.

xi) The ratio of the remuneration of the highest paid Director to that of the employeeswho are not Directors but receive remuneration in excess of the highest paid Directorduring the year cannot be determined as there was no remuneration being paid to Director.

xii) The Company affirms that remuneration given (if any) is as per the remunerationpolicy of the Company.

18. DISCLOSURE UNDER RULE 5 (2) & (3) OF THE COMPANIES (APPOINTMENT ANDREMUNERATION) RULES 2014

No directors/employees of the Company was in receipt of amount exceeding a salary ofRs. 500000/-per month or Rs. 6000000/- per annum or more when employed for whole ofthe year under the provisions of Rule 5 (2) & (3) of The Companies (Appointment AndRemuneration) Rules 2014.

19. DIRECTOR’S APPOINTMENT AND REMUNERATION POLICY

The Board has on the recommendation of the Nomination & Remuneration Committeeframed and adopted a policy for selection and appointment of Directors Key ManagerialPersonnel Senior Management and their remuneration. The said Policy has been posted onthe Website of the Company.

20. MEETINGS

The agenda and Notice for the Meetings is prepared and circulated in advance to theDirectors. During the year Fifteen (15) Board of Directors Meetings Three (3) Nomination& Remuneration Committee Meetings and Four (4) Audit Committee Meetings were convenedand held. The intervening gap between the Meetings was within the period prescribed underthe Companies Act 2013.

21. PARTICULARS OF CONTRACT OR ARRANGEMENT WITH RELATED PARTIES U/S 188(1)

None of the transactions with related parties falls under the scope of Section 188 (1)of the Companies Act 2013.

22. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

The provisions of Section 186 of the Act pertaining to investment and lendingactivities are not applicable to the Company since the Company is an NBFC. Details ofLoans Guarantees and Investments covered under the provisions of Section 186 of theCompanies Act 2013 are given in notes to the Financial Statements.

23. CORPORATE SOCIAL RESPONSIBILITY

The disclosures as per Rule 9 of Companies (Corporate Social Responsibility Policy)Rules 2014 is not applicable as Company is not covered under the criteria mentioned inSection 135(1) of Companies Act 2013.

24. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which wouldimpact the going concern status of the Company and its future operations.

25. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There have been no material changes and commitments affecting the financial position ofthe Company between the end of the financial year to which the financial statements relateand the date of the report.

26. SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES

During the year under review name of the companies which have become / ceased to beCompany’s subsidiaries joint ventures or associate companies are as below:

1. No Company has become Subsidiary of the Company during the financial year2014-15.

2. Companies which ceased to be subsidiaries during the financial year 2014-15

• Harit Tredelink Limited(Ceased to be subsidiary of the Company w.e.f 30th June2014)

• Danta Tradelink Limited(Ceased to be subsidiary of the Company w.e.f 30th June2014)

• Kalkin Probuild Limited(Ceased to be subsidiary of the Company w.e.f 30th June2014)

3. No Company has become / ceased to be a joint venture or associates during thefinancial year 2014-15.

27. COMPOSITION COMMITTEES OF THE BOARD:

a) AUDIT COMMITTEE: The composition of audit committee of the Company is as follow:

S. No. Name of Member Designation
1. Umesh Kumar Chairman
2. Sangita Member
3. Mahendra Kumar Sharda Member

The Board is under process of adopting optimum composition of the audit committee asprescribed in the Companies Act 2013. The Board has accepted all the recommendationsproposed by audit committee during the financial year.

b) NOMINATION AND REMUNERATION COMMITTEE:

S. No. Name of Member Designation
1. Umesh Kumar Chairman
2. Jeevan Singh Rana Member
3. Sangita Member

c) SHAREHOLDER GRIEVANCE COMMITTEE:

S. No. Name of Member Designation
1. Umesh Kumar Chairman
2. Mahendra Kumar Sharda Member
3. Sangita Member

28. STATUTORY AUDITORS

The Company’s Auditors M/s. Krishan Rakesh & Co. [FRN NO. 009088N] CharteredAccountants who were appointed in casual vacancy caused by resignation of M/s R.K. rathi& Co. Chartered Accountants and whose term of appointment expires in the year 2017have confirmed their eligibility under Section 141 of the Companies Act 2013 and theRules framed there under and shall be appointed as per provisions of Section 139 of theCompanies Act 2013 at the ensuing Annual General Meeting of the Company for a term of 4years starting from financial year 2015-16 to 2018-2019.

29. SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s Grover Ahuja & Associates Practicing Company Secretary to undertake theSecretarial Audit of the Company for the Financial Year 2014-15. The Secretarial AuditReport is prescribed form MR-3. Auditors Remarks are self-explanatory and do notrequire any clarification from the Board except the following:

Qualification: As the Company has appointed the Independent Director in theExtra-ordinary General Meeting dated 17th April 2015 the composition of Audit Committeeand Nomination and Remuneration Committee was not in accordance with the provisions ofCompanies Act 2013.

Comments: The Audit Committee and Nomination and Remuneration Committee has beenduly constituted by the Board of Directors in its meeting held on 30th April 2015.

Qualification: As required under Section 93 of the Companies Act 2013 read withRule 13 of Companies (Management and Administration) Rules 2014 the Company has notfiled MGT-10 for the change in holding of top ten shareholders pursuant to preferentialallotment in its board meeting dated 21st June 2014.

Comments: As the Companies Act 2013 was in the nascent stage and due to absence ofan in-house compliance officer the management inadvertently bypassed the requiredcompliance. The Company then appointed a Company Secretary w.e.f. 22nd September 2014 tocircumvent the above and the management has assured to comply all applicable provisions ofthe Companies Act 2013.

30. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexedherewith.

31. REPORT UNDER THE PREVENTION OF SEXUAL HARASSMENT ACT 2013

There were no complaints reported under the Prevention of Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013.

32. ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

In view of the nature of the activities carried out by the Company Section 134(3) (m)of the Companies Act 2013 read with Companies (Accounts) Rules 2014 relating toconservation of energy and technology absorption are not applicable to the Company.During the year under review the Company had no earnings and expenditure in foreignexchange.

33. DIRECTORS RESPONSIBILITY STATEMENT

To the best of our knowledge and belief and according to the information andexplanations obtained by us your Directors make the following statements in terms ofSection 134(3) (c) of the Companies Act 2013:

a.) that in the preparation of the annual accounts the applicable accounting standardshad been followed along with proper explanation relating to material departures;

b.) that the directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the company at the end of thefinancial year and of the profit and loss of the company for that period;

c.) that the directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the company and for preventing and detecting fraud and other irregularities;

d.) that the directors had prepared the annual accounts on a going concern basis;

e.) that the directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and

f.) that the directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

34. ACKNOWLEDGMENT

The Directors gratefully acknowledge all stakeholders of the Company viz. financialinstitutions Government Authorities customers members dealers vendors banks andother business partners for the excellent support received from them during the year. TheDirectors place on record their sincere appreciation to all employees executives staffand workers of the Company for their unstinted commitment and continued contribution tothe Company.

By the order of the Board

For BCL Enterprises Limited

Sd/-

Mahendra Kumar Sharda

Chairman

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