Commex Technology Ltd.
|BSE: 532342||Sector: IT|
|NSE: N.A.||ISIN Code: INE354B01029|
|BSE LIVE 15:15 | 22 Nov||0.51||
|NSE 05:30 | 01 Jan||Stock Is Not Traded.|
Commex Technology Ltd. (COMMEXTECH) - Director Report
Company director report
Your Directors have pleasure in presenting their Sixteenth Annual Report on thebusiness and operations of the Company together with the Audited Financial Statements forthe year ended 31st March 2016.
1. Financial Highlights (Standalone and Consolidated)
The financial highlights of the year under review is as below:
( Rs. in Lacs)
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 under consideration.
3. AMOUNT TRANSFERRED TO RESERVES:
The Board of the Company has proposed to retain INR 405.24 Lakhs in the profit and lossaccount and no amount is transferred to General reserves for the financial year 2015 -2016.
4. BUSINESS OUTLOOK:
Commex Technology Limited ("COMMEX") has successfully capitalized andtransformed itself from being a mere solution and service provider in the InformationTechnology 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 increased by 125.34% from INR 201 Lakhsto INR 452.94 Lakhs. Operating EBIDTA (Earnings Before Interest Taxes Depreciation andAmortization) decreased 12.12% from INR 328.67 to INR 288.83 Lakhs. Profit BeforeTax (PBT) Increased by 40.44% from INR 144.59 Lakhs to INR 203.06 Lakhs. ProfitAfter Tax (PAT) decreased by 99.30% from INR 142.01 Lakhs to INR0.99 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 2016 the company has the following subsidiaries/associatecompanies Subsidiary Companies:
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 alongwith proper explanation relatingto 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 2016 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 2016 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 Ms. Kavita Pawar(DIN: 02717275) was appointed as non-executive Woman Director of the company at the annualgeneral meeting of the Company held on 30th September 2015.
Pursuant to the provision of Section Sections 196197 & 203 read with Schedule Vand other applicable provisions if any of the Companies Act 2013 ("the Act")The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014(including any statutory modifications or re-enactment(s) thereof forthe time being inforce) Mr. Ketan Sheth DIN: 00026117 was appointed as Managing Director of the Company inthe Board meeting held on 7th November 2016 for a period of one year with effect from 9thJanuary 2016. The resolution seeking the approval of the members for appointment of Mr.Ketan Sheth have been incorporated in the notice of the forthcoming annual general meetingof the Company along with the brief details about Mr. Sheth.
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.
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 nonexecutive directors of the Company. No convertible instruments are held byany of the nonexecutive directors of the Company.
12. STATEMENTON DECLARATION BY INDEPENDENT DIRECTOR:
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. NUMBER OF MEETINGS OF THE BOARD:
During the financial year 2015-16 six 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 SEBI (LODR) Regulations 2015.
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 2016 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 non-executivedirectors. The meeting also assessed the quality quantity and timeliness of flow ofinformation between the company management and the board that is necessary forthe board toeffectively and reasonably perform its duties.
15. NOMINATION AND REMUNERATION POLICY:
In terms of Section 178 (3) of the Companies Act 2013 and Regulation 18 and ScheduleII and Schedule V of the SEBI (LODR) Regulations 2015 entered in to with the stockexchange a policy on Nomination and Remuneration of Directors and Senior ManagementEmployees including inter alia criteria for determining qualifications positiveattributes and independence of directors was formulated by the Nomination and RemunerationCommittee and adopted by the Board of Directors. The said policy is annexed asAnnexureAtothe Board's Report. The said policy is also posted on the website of the Company
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 LLP Chartered Accountants Mumbai retire at the ensuingAnnual General 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 2015 - 2016 asrequired under 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' report does not contain any qualifications reservations oradverse remarks.
Secretarial auditors' report have given a remark on VAT liability of INR 1.10Crores during the year under review on the same Board of Directors of the Company wouldlike to state that company have reversed the same in the first quarter of the financialyear 2016 - 2017.
21. PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
22. 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 in terms of Regulation 23 ofSEBI (LODR) Regulations 2015. The said policy is posted on the website of the Company
23. 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 theCompanies (Corporate Social Responsibility Policy) Rules 2014. The said policy is postedon the website of the Company www.commextechnology.comand its weblink is:
24. EXTRACTOF ANNUAL RETURN:
An extract of Annual Return in Form MGT 9 for the Financial Year 2015 - 2016 has beenenclosed as "Annexure E" forming part of the Board's Report.
25. 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 for the financial year:
v. Percentage increase in remuneration of each director Chief Financial OfficerChief Executive Officer Company Secretary or Manager if any in the financial year:
NehaRushi Company Secretary-20%
AjayRaut Chief Financial Officer -NA
vi. Percentage increase in the median remuneration of employees in the financial year:
There was 4.5% increase in the median remuneration of the employees for the reportingperiod.
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 3% to 4% based on individualperformance. The increase in remuneration is in line with the market trends in India.
ix. Comparison of the remuneration of the key managerial personnel against theperformance of the Company:
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:
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 INR10 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:
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 9 %.
The increase in managerial remuneration was around 20%
Appraisals to Key managerial personnel's were due as the same was not increased in thelast financial year.
xiii. Comparison of each remuneration of the key managerial personnel against theperformance of the Company:
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 isasperthe remuneration policy of theCompany:
The Company affirms remuneration is as per the remuneration policy of the Company.
26. 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.
27. 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.
28. DISCLOSURE REGARDING ISSUE OF SWEAT EQUITY SHARES:
During the year under review the Company has not issued any Sweat Equity Shares.
29. MATERIAL CHANGES AFFECTING TH E FI NANCIAL POSITION OF THE COM PANY:
There have not been any material changes and commitment affecting the financialposition of the Company during the financial year 2015-16.
30. DISCLOSURE REQUIREMENTS:
Pursuant to the provisions of Schedule IV to the Companies Act 2013 ("theAct") and Schedule V of SEBI (LODR) Regulations 2015 Terms and Conditions forAppointment of Independent directors are posted on the website of the Company
Details of the familiarisation programme of the Independent directors is postedon the website of the Companywww.commextechnology.comand 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 itsweblink is:
The policy for determining material subsidiary of the company pursuant toRegulation 24 of SEBI (LODR) Regulations 2015 is posted on the website of the Company
Policy on dealing with related party transactions is posted on the website ofthe Company www.commextechnology.com andits weblink is:
As per Schedule V of the SEBI (LODR) Regulations 2015 entered into with theStock Exchange Corporate Governance Report with auditors' Certificate and ManagementDiscussion and Analysis are attached which forms part off this report.
31. 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.
32. 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. 20 formingpart of Accounts.
33. 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.
34. FRAUD REPORTING (REQUIRED BY THE COMPANIES AMENDMENT BILL 2014) If Any:
During the period under review there was no fraud reporting in the company.
35. DISCLOSURES RELATING TO UNCLAIMED SUSPENSE ACCOUNT AS PER AMENDED CLAUSE 5AOFTHE LISTING AGREEMENT:
36. IMPLEMENTATION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013:
The Company is not required to constitute Internal Complaints Committee of the Companyunder the 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 under the said Act has been reported to the Company.
37. 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
Chairman and Managing Director