FOR THE FINANCIAL YEAR 2014 - 2015
Your Directors have pleasure in presenting their Fifteenth Annual Report on thebusiness and operations of the Company together with the Audited Financial Statements forthe year ended 31st March 2015.
1. Financial Highlights (Standalone and Consolidated)
The financial highlights of the year under review is as below:
(Rs. in Lacs)
|Sr. No. Particulars || |
| ||31.03.2015 ||31.03.2014 ||31.03.2015 ||31.03.2014 |
|1. Income from operations ||- ||2429.11 ||201.00 ||2443.76 |
|2. Other Income ||394.75 ||105.67 ||394.75 ||105.67 |
|3. Net Total Income (1+2) ||394.75 ||2534.77 ||595.75 ||2549.43 |
|4. Employee Benefit Expenses ||104.72 ||968.40 ||123.24 ||970.54 |
|5. Other Expenses ||101.71 ||1013.29 ||143.59 ||1021.52 |
|6. EBIDTA ||188.32 ||553.09 ||328.92 ||557.37 |
|7. Less: Interest and Finance charges ||0.17 ||2.48 ||0.25 ||2.51 |
|8. Less: Depreciation ||184.08 ||291.84 ||184.08 ||291.84 |
|9. Profit before Tax (6-7-8) ||4.07 ||258.77 ||144.59 ||263.03 |
|10. Provision for Tax ||2.58 ||52.09 ||2.58 ||52.09 |
|Less: MAT Credit Entitlement ||- ||(25.07) ||- ||(25.07) |
|Deferred Tax ||- ||71.23 ||- ||71.23 |
|11. Net Profit after tax (9-10) ||1.49 ||160.52 ||142.02 ||164.78 |
|12. Extra Ordinary Items ||- ||-- ||- ||-- |
|13. Net Profit/(Loss) for period (11-12) ||1.49 ||160.52 ||142.02 ||164.78 |
|14. Less: Minority Interest ||- ||- ||- ||- |
|15. Paid up Equity Share Capital (Face value Rs.2/- per share) ||3102.14 ||3102.14 ||3102.14 ||3102.14 |
|16. Earning Per Shares (Basic) ||0.00 ||0.10 ||0.09 ||0.11 |
Your Directors is of the opinion that the company does not have sufficient profits toissue Dividend in the Current Year and therefore have not recommended any Dividend for theyear underconsideration.
3. AMOUNTTRANSFERREDTO RESERVES:
The Board of the Company has proposed to retain INR 628.46 Lakhs in the profit and lossaccount and no amount is transferred to General reserves for the financial year 2014 -2015.
4. BUSINESS OUTLOOK:
CommexTechnology Limited (-COMMEX-) has successfully capitalized and transformed itselffrom being a mere solution and service provider in the Information Technology domain.
With a clear focus on business and technology Commex has efficiently harnessed itsdecades of exposure in the IT space the domain expertise developed and acquired by itthrough its various approach plans for inorganic growth. Your Company has successfullydeveloped a state-of-the-art solution suite addressing markets in the country.
Commex continues to invest in the research and development of cutting edge IT productsfor its various initiatives. The in-house technology bandwidth and the domain expertiseare critical success factors forthe various initiatives undertaken by the company.
5. PERFORMANCE REVIEW (CONSOLIDATED BASIS):
On consolidated basis revenue from operations decreased by 91.77% from IN R 2443.76Lakhs to INR 201 Lakhs. Operating EBIDTA (Earnings Before Interest Taxes Depreciationand Amortization) decreased 40.77% from I NR 554.87 to I NR 328.67 Lakhs. Profit BeforeTax (PBT) decreased by 45.03 % from INR 263.03 Lakhs to INR 144.59 Lakhs. Profit After Tax(PAT) decreased by 13.82% from IN R 164.78 Lakhs to IN R 142.01 Lakhs.
6. CHANGE IN NATURE OF BUSINESS IF ANY:
During the year under review there was no change in the business carried on by theCompany or its subsidiaries.
7. SUBSIDIARY AND ASSOCIATE COMPANIES:
As on 31st March 2015 the company has the following subsidiaries/associatecompanies
1. M/s. IT Capital Services Pvt. Ltd.
2. M/s. Orient Information FZ-LLC-UAE
1. M/s. Universal Commodity Exchange Limited
There has been no material change in the nature of the business of thesubsidiaries and associate companies.
Pursuant to the provisions of Section 129(3) of the Companies Act 2013 astatement containing salient features of the financial statements of the Company'ssubsidiaries and associate companies in Form AOC-1 is attached to the financial statementsof the Company.
8. CHANGES IN SHARE CAPITAL:
During the year under review there was no change in the Authorised or Paid up ShareCapital of the Company.
9. DIRECTORS' RESPONSIBILITY STATEMENT:
As required by Section 134 (5) of the Companies Act 2013 the Directors hereby statethat:
a. in preparation of the annual accounts the applicable accounting standards have beenfollowed along with proper explanation relating to material departures if any;
b. 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 31st March 2015 and profit for theyear ended on that date;
c. 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;
d. the accounts have been prepared for the financial year ended 31st March 2015 on agoing concern basis;
e. Internal Financial Controls to be followed by the Company have been laid down andthe said Internal Financial Controls are adequate and are operating effectively and;
f. proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and are operating effectively.
10. DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Pursuant to the provisions of Section 149 of the Companies Act 2013 which came intoeffect from April 1 2014 Mr. Jayant Mitra (DIN: 008010211) and Mr. Yeshwant Divekar(DIN: 01574821) were appointed as independent directors at the annual general meeting ofthe Company held on 30th September 2014. The terms and conditions of appointment ofindependent directors are as per Schedule IV of the Act. They have submitted a declarationthat each of them meets the criteria of independence as provided in Section 149(6) of theAct and there has been no change in the circumstances which may affect their status asindependent director during the year.
Pursuant to the provisions of Section 149 of the Companies Act 2013 of the Act Ms.Kavita Pawar (DIN: 02717275) was appointed as Woman Director/Additional Director of theCompany. She is Commerce Graduate and have rich experience in the field of Finance. Theresolution seeking approval of the Members for the appointment of Ms. Kavita Pawar havebeen incorporated in the notice of the forthcoming annual general meeting of the Companyalong with brief details about her. The Company has received a notice under Section 160 ofthe Act along with the requisite deposit proposing the appointment of Ms Kavita Pawar.
Pursuant to the provisions of Section 203 of the Act which came into effect from April12014 the appointment of Mr. Ajay Raut Chief Financial Officer and Ms. Neha RushiCompany Secretary as key managerial personnel of the Company were formalised. Ms. SwetaKhemka stepped down from the position of Company Secretary during the year and Boardplaces on records its appreciation of the invaluable contribution and guidance provided byher.
11. DISCLOSURE OF PECUNIARY RELATIONSHIP:
There was no pecuniary relationship or transactions of the non-executive directorsvis-a vis the company during the year. Also no payment except sitting fees was made toany of the non-executive directors of the Company. No convertible instruments are held byany of the non-executive directors of the Company.
12. STATEMENTON DECLARATION BYINDEPENDENTDIRECTOR:
Mr. Jayant Dolatrai Mitra and Mr. Yeshwant Jaywant Divekar Independent Directors ofthe Company have given their respective declaration as required under Section 149(7) ofthe Companies Act 2013 to the effect that they meet the criteria of independence asprovided in Section 149(6) of the Companies Act 2013 which were taken on record by theBoard.
13. NUMBEROFMEETINGSOFTHE BOARD:
During the financial year 2014-15 eight meetings of the Board of Directors were held.For details of the Board meetings please refer to the Corporate Governance forming part ofthe Board's Report.
14. STATEMENTON ANNUAL EVALUATION OF BOARD COMMITTEE AND ITS DIRECTORS:
The board of directors has carried out an annual evaluation of its own performanceBoard committees and individual directors pursuant to the provisions of Section 134 (3)(p) of the Companies Act 2013 read with Rule 8(4) of The Companies (Accounts) Rules 2014and the corporate governance requirements as prescribed by Securities and Exchange Boardof India (-SEBI-) under Clause 49 of the Listing Agreements (-Clause 49-).
The performance of the Board was evaluated by the Board after seeking inputs from allthe directors on the basis of the criteria such as the Board composition and structureeffectiveness of board processes information and functioning transparency adhering togood corporate governance practices etc.
The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.
The Board and the Nomination and Remuneration Committee (-NRC-) reviewed theperformance of the individual directors on the basis of the criteria such as thecontribution of the individual director to the Board and committee meetings likepreparedness on the issues to be discussed meaningful and constructive contribution andinputs in meetings leadership quality attitude initiatives decision making commitmentachievements etc. In addition the Chairman was also evaluated on the key aspects of hisrole.
In a separate meeting of independent Directors on 29th March 2015 performance of non-independent directors performance of the board as a whole and performance of the Chairmanwas evaluated taking into account the views of executive directors and nonexecutivedirectors. The meeting also assessed the quality quantity and timeliness of flow ofinformation between the company management and the board that is necessary for the boardto effectively and reasonably perform its duties.
15. NOMINATION AND REMUNERATION POLICY:
In terms of Section 178 (3) of the Companies Act 2013 and Clause 49 IV of the listingagreement entered in to with the stock exchange a policy on Nomination and Remunerationof Directors and Senior Management Employees including inter alia criteria fordetermining qualifications positive attributes and independence of directors wasformulated by the Nomination and Remuneration Committee and adopted by the Board ofDirectors at their respective meetings held on 14th November 2014 The said policy isannexed as Annexure A to the Board's Report. The said policy is also postedon the website of the Company www.commextechnology.com and its weblink is:http://www.commextechnology.com/download/policy/nomination_and_remuneration_policy_commex.pdf
16. INTERNAL FINANCIAL CONTROLS:
The Company has adopted the policies and procedures for ensuring the orderly andefficient conduct of its business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of fraud and errors the accuracyand completeness of the accounting records and timely preparation of reliable financialdisclosures.
17. AUDIT COMMITTEE:
The details pertaining to composition of audit committee are included in the CorporateGovernance Report which forms part of this report.
M/s. Kanu Doshi Associates Chartered Accountants Mumbai retire at the ensuing AnnualGeneral Meeting and being eligible offer themselves for re-appointment.
SG & Associates Practicing Company Secretaries from Mumbai was appointed toconduct the secretarial audit of the Company for the financial year 2014-2015 as requiredunder Section 204 of the companies Act 2013 and rules made thereunder.
19. SECRETARIAL AUDIT REPORT:
In terms of Section 204 (1) of the Companies Act 2013 a Secretarial Audit Report isannexed as Annexure B of the Directors' Report.
20. EXPLANATION AND COMMENTS BY THE BOARD ON QUALIFICATION/ RESERVATION/ ADVERSEREMARK/ DISCLAIMER MADE IN AUDITORS' REPORT AND SECRETARIAL AUDITORS' REPORT:
The auditors' have given a qualification on MAT Credit and on the same the Boardof Directors of the Company would like to state that the Company was not able to pay taxfor the year 2012-2013 and the Company is in process of reversing the MAT credit in theCurrent financial yeari.e. 2015-2016.
Secretarial auditors' report does not contain any qualifications reservationsor adverse remarks.
21. RISK MANAGEMENT:
The Board of the Company has formed a risk management committee to frame implement andmonitor the risk management plan for the Company. The committee is responsible forreviewing the risk management plan and ensuring its effectiveness. The audit committee hasadditional oversight in the area of financial risks and controls. Major risks identifiedby the businesses and functions are systematically addressed through mitigating actions ona continuing basis. During the year your Company has set up a new Risk ManagementCommittee in accordance with the requirements of Listing Agreement to monitor the risksand their mitigating actions. During the year under review no risk threatening theexistence of the Company was identified.
22. PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
23. TRANSACTIONS WITH RELATED PARTIES:
None of the transactions with related parties falls under the scope of Section 188(1)of the Act. Information on transactions with related parties pursuant to Section 134(3)(h)of the Act read with rule 8(2) of the Companies (Accounts) Rules 2014 are given in AnnexureC in Form AOC-2 and the same forms part of this report.
The Board of Directors of the Company had formulated a policy on related partytransactions and materiality of Related Party Transactions on 14th November 2014 in termsof Clause 49 of the listing agreement. The said policy is posted on the website of theCompany www.commextechnology.com and its weblink is:
24. CORPORATE SOCIAL RESPONSIBILITY:
The brief outline of the Corporate Social Responsibility (CSR) Policy of the Companyand the initiatives undertaken by the Company on CSR activities during the year are setout in -Annexure D- of this report in the format prescribed in the Companies(Corporate Social Responsibility Policy) Rules 2014. The said policy is posted on thewebsite of the Company www.commextechnology.com and its weblink is:
25. EXTRACT OF ANNUAL RETURN:
An extract of Annual Return in Form MGT 9 for the Financial Year 2014 - 2015 has beenenclosed as -Annexure E- forming part of the Board's Report.
26. PARTICULARS OF EMPLOYEES:
The information required under Section 197 of the Act read with rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are givenbelow:
i. Employee of the Company employed throughout the financial year who was in receiptof remuneration for that year which in the aggregate not less than rupees sixty lakhs:
ii. Employee of the Company employed for a part of the financial year who was inreceipt of remuneration for any part of that year at a rate which in the aggregate wasnot less than five lakh rupees per month: NIL
iii. Employee of the Company employed throughout the financial year or part thereofwho was in receipt of remuneration in that year which in the aggregate or as the casemay be at a rate which in the aggregate is in excess of that drawn by the managingdirector or whole-time director or manager and holds by himself or along with his spouseand dependent children not less than two percent of the equity shares of the company:
NIL. Further Managing Director of the Company is not getting any commission from theCompany or from any of its subsidiaries.
iv. Ratio of the remuneration of each director to the median remuneration of theemployees of the Company forthe financial year:
|Non-executive Directors ||Ratio of Median remuneration |
|Jayant Mitra ||8.88 |
|Yeshwant Divekar ||8.88 |
v. Percentage increase in remuneration of each director Chief Financial OfficerChief Executive Officer Company Secretary or Manager if any in the financial year:
Neha Rushi Company Secretary-N A
AjayRaut Chief Financial Officer -NA
vi. Percentage increase in the median remuneration of employees in the financial year:
There was 18.74 % increase in the median remuneration of the employees for thereporting period.
vii. Number of permanent employees on the rolls of company: 4
viii. The explanation on the relationship between average increase in remunerationand Company performance:
On an average individual increments varied from 4% to 5% based on individualperformance. The increase in remuneration is inline with the market trends in India.
ix. Comparison of the remuneration of the key managerial personnel against theperformance of the Company:
|Aggregate remuneration of key managerial personnel (KMP)in FY15 (INR in Lacs) ||7.31 |
|Revenue (INR in Lacs) ||0 |
|Remuneration of KMPs (as % of revenue) ||0 |
|Profit before Tax (PBT) (INR in Lacs) ||4.07 |
|Remuneration of KMP (as % of PBT) ||(179.61%) |
x. Variations in the market capitalisation of the Company price earnings ratio asat the closing date of the current financial year and previous financial year:
|Particulars ||31st March 2015 ||31st March 2014 || |
|Market Capitalisation (in Lakhs) ||2016.39 ||22102.75 ||(90.89%) |
|Price Earnings Ratio ||0 ||142.5 ||(100%) |
xi. Percentage increase or decrease in the market quotations of the shares of theCompany in comparison to the rate at which the Company came out with the last publicoffer:
Initial public offer was in the year 2000 at INR 10 and face value of share was 10.Later in the year 2006 there was splitting of shares and the face value of the share wasINR 2. Thus % change is calculated accordingly:
|Particulars ||31st March 2015 ||Rate at which equity shares were offered at Initial Public Offer ||% Change |
|Market Price (BSE) ||1.30 ||2 ||(35%) |
xii. Average percentile increase already made in the salaries of employees otherthan the managerial personnel in the last financial year and its comparison with thepercentile increase in the managerial remuneration and justification thereof and point outif there are any exceptional circumstances for increase in the managerial remuneration:
The average annual increase was around 17%.
There was no increase in the managerial remuneration for the year.
xiii. Comparison of each remuneration of the key managerial personnel against theperformance of the Company:
| ||Mr. Ketan Sheth ||Ajay Raut - Chief Financial Officer ||Sweta Khemka Company Secretary (01/04/2014 to 09/07/2014 ||Neha Rushi - Company Secretary (w.e.f September 2014) |
|Remuneration in the Financial Year 2014 - 2015 (INR in Lakhs ||1 ||3.5 ||2.06 ||1.75 |
|Revenue (INR in Lakhs) || || ||0 || |
|Remuneration as % of Revenue ||0 ||0 ||0 ||0 |
|Profit before Tax (PBT) (INR in Lakhs) || || ||4.07 || |
|Remuneration as % of PBT ||0 ||85.99 ||50.61 ||42.99 |
xiv. The key parameters for any variable component of remuneration availed by thedirectors:
There are no variable components in remuneration to the Directors.
xv. The ratio of the remuneration of the highest paid director to that of theemployees who are not directors but receive remuneration in excess of the highest paiddirector during the year:
xvi. Affirmation that the remuneration is as per the remuneration policy of theCompany:
The Company affirms remuneration is as per the remuneration policy of the Company.
27. DISCLOSURE REGARDING ISSUE OF EQUITY SHARES WITH DIFFERENTIAL VOTING RIGHTS:
During the year under review the Company has not issued any shares with differentialvoting rights.
28. DISCLOSURE REGARDING ISSUE OF EMPLOYEE STOCK OPTION SCHEME:
During the year under review no option under 'Employee Stock Option Scheme' wasgranted or vested to any employee or directors of the Company.
29. DISCLOSURE REGARDING ISSUE OF SWEAT EQUITY SHARES:
During the year under review the Company has not issued any Sweat Equity Shares.
30. MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY:
There have not been any material changes and commitment affecting the financialposition of the Company during the financial year 2014-15.
31. DISCLOSURE REQUIREMENTS:
Pursuant to the provisions of Schedule IV to the Companies Act 2013 (-the Act-)and Clause 49 of the Listing Agreement Terms and Conditions for Appointment ofIndependent directors are posted on the website of the Company www.commextechnology.comand its weblink is:
Details of the familiarisation programme of the Independent directors is postedon the website of the Company www.commextechnology.com and its weblink is:
Whistle Blower Policy/ Vigil Mechanism: The Company has established a VigilMechanism for directors and employees to report genuine concerns. The vigil mechanismprovide for adequate safeguards against victimization of person who use Vigil Mechanismand also provide for direct access to the Chairman of the Audit Committee in appropriateand exceptional cases. The details of Vigil Mechanism is displayed on the website of theCompany www.commextechnology.com and its weblink is
The policy for determining material subsidiary of the company pursuant torevised Clause 49 of the Listing Agreement is posted on the website of the Companywww.commextechnology.com and itsweblinkis:
Policy on dealing with related party transactions is posted on the website ofthe Company www.cornrnextechnology.com and its weblink is:
As per Clause 49 of the Listing Agreement entered into with the Stock ExchangeCorporate Governance Report with auditors' Certificate and Management Discussion andAnalysis are attached which forms part off this report.
32. DEPOSITS FROM PUBLIC:
The Company has not accepted any deposits from public and as such no amount on accountof principal or interest on deposits from public was outstanding as on the date of theBalance Sheet.
33. INFORMATION REQUIRED UNDER RULE 8 (3) OF THE COMPANIES (ACCOUNTS) RULES 2014 -CONSERVATION of ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
a) Conservation of Energy:
The activities of your company require minimal energy consumption and every endeavorhas been made to ensure the optimal use of energy avoid wastage and conserve energy asfar as possible.
b) Technology Absorption:
The activities of the Company at present do not involve technology absorption andresearch and development.
c) Foreign exchange earnings and outgo:
The details of Foreign exchange earnings and outgo are detailed in Note No. 22 formingpart of Accounts.
34. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE:
During the period under review no order had been passed by the regulators/ courts ortribunals which have an effect on the going concern status of the company and itsoperations.
35. FRAUD REPORTING (REQUIRED BYTHE COMPANIES AMENDMENT BILL 2014) IF ANY:
During the period under review there was no fraud reporting in the company.
36. DISCLOSURES RELATING TO UNCLAIMED SUSPENSE ACCOUNT AS PER AMENDED CLAUSE 5AOF THELISTING AGREEMENT:
|Aggregate number of shareholders and the outstanding shares lying in the Unclaimed Suspense Account at the beginning of the year ||Number of shareholders who approached the issuer for transfer of shares from the Unclaimed Suspense Account during the year ||Number of shareholders to whom shares were transferred from the Unclaimed Suspense Account during the year ||Aggregate number of shareholders and the outstanding shares lying in the Unclaimed Suspense Account at the end of the year |
|NIL ||NIL ||NIL ||NIL |
37. IMPLEMENTATION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013:
The Company is not required to constitute Internal Complaints Committee of the Companyunderthe Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal)Act 2013 as the permanent employees are less than 10. Further there are no instances ofSexual Harassment of Women underthe said Act has been reported to the Company.
38. EMPLOYEE RELATIONS:
The relations of the management with staff and workers remained cordial during theentire year.
The directors thank the Company's employees customers vendors investors and academicinstitutions for their continuous support.
The directors also thank the government of various countries government of India thegovernments of various states in India and concerned government departments / agencies fortheir co-operation.
The directors appreciate and value the contributions made by every member of the Commexfamily.
| ||On behalf of the Board of Directors |
| ||Sd/- |
| ||Ketan Sheth |
|Date: 02/09/2015 ||Chairman and Managing Director |
|Place: Mumbai || |