The Members of
Golden Goenka Fincorp Limited
Your Directors have pleasure in presenting the 24thAnnual Report togetherwith the Audited Accounts for the year ended 31st March 2017.
1. FINANCIAL RESULTS
(Rs. in Lakhs)
|Particulars ||For the year ended March 31 2017 ||For the year ended March 31 2016 |
|Revenue from Operation ||2594.49 ||2450.64 |
|Profit before Provisions & Tax ||1818.14 ||1633.02 |
|Profit before Tax ||1812.19 ||1291.96 |
|Tax Expenses ||667.37 ||559.98 |
|Income tax in respect of earlier year ||7.26 ||- |
|Profit after Tax ||1137.56 ||731.98 |
|Balance brought forward from previous year ||1187.16 ||601.58 |
|Amount available for appropriation ||2324.72 ||1333.55 |
|Appropriations:- || || |
|Interim dividend including tax ||- ||- |
|Statutory Reserve ||227.51 ||146.40 |
|Balance Carried to Balance Sheet ||2097.21 ||1187.16 |
2. OPERATIONS & BUSINESS ACTIVITIES
The key highlights of your Company's performance during the year under review are:
i. The profit before bad debts provisions and tax is Rs.1818.14 Lakhs as againstRs.1633.02 Lakhs in the last year.
ii. Profit before taxation is Rs.1812.19 Lakhs as against Rs.1291.96 Lakhs in thelast year.
iii. Net profit after taxation is Rs. 1137.56 Lakhs as against Rs. 731.98 Lakhs in thelast year.
iv. The total assets is Rs. 23491.73 Lakhs as against Rs. 22354.05 Lakhs in the lastyear.
The key driver to growth in today's scenario requires higher operating efficiencysustainability customer satisfaction improving capabilities and exploring new market.Considering the same your Company intends to expand into financial market segment andcapitalize the set up for the same along with increasing capacity as required by thebusiness. For the purpose of diversification your Company is engaged in the expansion ofits business of vehicle loan and consumer loan etc. The outlook of the business is veryexciting and we take it as an opportunity to do something unique and exceptional. YourCompany discloses Standalone Unaudited Financial Results on a quarterly basis StandaloneAudited Financial Results on an annual basis and Consolidated Audited Financial Results onan annual basis. The Financial Statements of your Company have been prepared in accordancewith the
Generally Accepted Accounting Principles in India (Indian GAAP) to comply with theAccounting Standards notified under the relevant provisions of the Companies Act 2013 asapplicable.
A detailed review on the operation and performance of the Company and its business isgiven in the Management Discussion and Analysis Report. The same is enclosed as Annexure- 1 to this Report.
The Directors of your Company do not recommend any dividend for the financial yearended 31st March 2017 in order to plough back the resources for future growth.
The Company is a non-deposit taking Non-Banking Financial Company and therefore is notaccepting any public deposits during the year.
5. LISTING OF SHARES
The equity share of the Company continues to be listed on The BSE Limited and TheCalcutta Stock Exchange Limited. The Company has paid the Annual Listing Fees to the saidStock Exchanges for the financial year 2017-18.
Your Company has applied to National Stock Exchange of India Ltd (NSE) for listing ofits entire equity shares on the main Board of NSE. The same is under consideration of NSE.
6. RESERVE BANK OF INDIA (RBI) GUIDELINES
Your Company continues to carry on its business of Non- Banking Financial Institutionwithout accepting deposits. The Company has not accepted public deposits during the yearunder review. Further the Company has complied with and continues to comply with all theprudent financial management norms and directions issued by Reserve Bank of India asapplicable to it including Fair Practices Anti Money Laundering and Know Your Customer(KYC) Guidelines.
Disclosures as prescribed by Non-Systemically Important Non-Banking Financial(Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions2015 and other applicable NBFC Regulations have been made in this Annual Report.
7. SHARE CAPITAL
The paid up equity share capital as on 31st March 2017 was Rs.9511.92Lakhs. There was no public issue rights issue bonus issue or preferential issue etc.during the year. The Company has neither issued shares with differential voting rightssweat equity shares nor has it granted any stock options.
8. DIRECTORS' RESPONSIBILITY STATEMENT
In terms of the requirement of Section 134 (3) (c) of the Companies Act 2013 yourDirectors state that:
a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
b) they have selected such accounting policies and applied them consistently and madejudgements and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at the end of the financial year and of theprofit of the Company for that period;
c) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) they have prepared the annual accounts on a going concern basis;
e) they have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and were operating effectively; and
f) they have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
9. CORPORATE GOVERNANCE
Pursuant to the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 Report on Corporate Governance along with certificate of compliance from M/s K. Arun& Co. Company Secretaries confirming compliances to the conditions of the CorporateGovernance is enclosed as Annexure - 2 to this Report.
All Board members and Senior Management personnel have affirmed compliance with theCode of Conduct for the year 2016-17. A declaration to this effect signed by the ManagingDirector/CEO of the Company is contained in the Corporate Governance Section forming partof this Report.
The Managing Director/CEO and CFO have certified to the Board with regard to thefinancial statements and other matters as required under Regulation 17(8) of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.
10. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO
The Company is a Non-Banking Financial Company and therefore information relating toConservation of Energy and Technology Absorption are not applicable.
The Company has neither earned nor used any foreign exchange during the year underreview.
11. KEY MANAGERIAL PERSONNEL
During the period under review Mr. Gourav Choudhary Chief Financial Officer of theCompany has resigned w.e.f. 15th June 2016 and in his absence Mr. AyushAgrawal was appointed as Chief Financial Officer pursuant to Section 203 read with Rule 8of the Companies (Appointment and Remuneration) Rules 2014 w.e.f. 22nd August2016. The Board places on record its high appreciation of the valuable services renderedby Mr. Gourav Choudhary during his tenure as Chief Financial Officer of the Company.
12. EXTRACT OF ANNUAL RETURN
The Extract of Annual Return is prepared in Form MGT-9 as per the provisions of Section92 (3) of the Companies Act 2013 and Rule 12 of Companies (Management and Administration)Rules 2014 and the same is enclosed as Annexure-3 to this Report.
13. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Your Company is exempted from the applicability of the provisions of Section 186 of theCompanies Act 2013 ("The Act") read with Rule 11 of the Companies (Meetings ofBoard and its Powers) Rules 2014 and Companies (Meetings of Board and its Powers)Amendment Rules 2015 as your Company is RBI registered Non-Banking Financial Companywhose principal business inter-alia includes financing of companies.
Details of Loans Investments Guarantees or security in connection with loans to otherbody corporates or persons as at the end of the year are given in notes to the FinancialStatements.
14. MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION
There is no such material change and commitment affecting the financial position ofyour Company which have occurred between the end of the financial year of your Company towhich the financial statements relate and the date of the Report.
15. MEETING OF THE BOARD AND AUDIT COMMITTEE
The Board meets at regular intervals to discuss and decide on policy and strategy apartfrom other Board business. During the year seven Board Meetings and five Audit CommitteeMeetings were convened and held. The intervening gap between the Meetings was within theperiod prescribed under the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015. The details regarding Board and AuditCommittee Meetings are given in the Corporate Governance Section forming part of thisReport.
16. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143(12)
During the year under review there were no frauds reported by the auditors to theAudit Committee or the Board under section 143(12) of the Companies Act 2013.
17. SECRETARIAL STANDARDS OF ICSI
The Company is in compliance with the requirements of Secretarial Standards on Meetingsof the Board of Directors (SS-1) and General Meetings (SS-2).
18. SUBSIDIARYCOMPANIES/ASSOCIATECOMPANIES / JOINT VENTURES
During the year under review the name of the following wholly owned Subsidiaries ofyour Company has been changed due to conversion from private to public company:-
a) Golden Goenka Financial Advisors Private Limited (Name changed to Golden GoenkaFinancial Advisors Limited w.e.f. 12th May 2016).
b) Goodpoint Conclave Private Limited (Name changed to Goodpoint Conclave Limitedw.e.f. 10th June 2016).
c) Golden Goenka Management Consultancy Services Private Limited (Name changed toGolden Goenka Management Consultancy Services Limited w.e.f. 13th July 2016).
Further M/s Shree Saishraddha Cements Private Limited (SSCPL) cease to be the associateof the Company w.e.f. 23rd December 2016.
As per the provisions of Section 129(3) of the Companies Act 2013 ("theAct") read with Rule 5 of the Companies (Accounts) Rules 2014 as amended by theCompanies (Accounts) Amendment Rules 2016 a separate statement containing the salientfeatures of the financial statements of the Subsidiary Companies/ Associate Companies/Joint Ventures is prepared in Form AOC-1 and the same is enclosed as Annexure 4 tothis Report.
As on March 31 2017 the Company has six wholly owned non listed Indian subsidiariesand one Associate Company. Except Aristro Capital Markets Limited none of thesubsidiaries of your Company are Material Subsidiary.
19. CONSOLIDATED FINANCIAL STATEMENTS
Pursuant to Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 the Consolidated Financial Statements have been prepared by theCompany's Management in accordance with the requirements of Accounting Standards 21 issuedby the Institute of Chartered Accountants of India (ICAI) and as per the provisions ofCompanies Act 2013 which forms part of the Annual Report.
As per the provisions of Section 136 of the Companies Act 2013 the Company has placedseparate audited accounts of its subsidiaries on its website www.goldengoenka.comand copy of separate audited financial statements of its subsidiaries will be provided tothe shareholders at their request. The annual accounts of subsidiaries will also be keptfor inspection by any Member of the Company at the registered office of the Company. TheConsolidated Financial Statements presented by the Company include the financialinformation of its subsidiaries.
The financials of Purple Advertising Services Private Limited an associate of theCompany could not be completed and hence same has not been considered for consolidationpurpose.
20. AUDITORS AND AUDITOR'S REPORT A. Statutory Auditors
M/s Das & Prasad Chartered Accountants (ICAI Firm Registration Number: 303054E)were appointed as Statutory Auditors of the Company at the 21st Annual GeneralMeeting (AGM) held on 10th September 2014 to hold office for a term of fiveconsecutive years from the conclusion of the 21st Annual General Meeting tillthe conclusion of the 25th Annual General Meeting subject to ratification ofthe appointment by the members at every AGM held after the 21st Annual GeneralMeeting.
As per the requirements laid down under Sections 139 and 141 of the Companies Act 2013read with Rule 4 of the Companies (Audit and Auditors) Rules 2014 the Company hasreceived consent from M/s Das & Prasad Chartered Accountants Statutory Auditors ofthe Company and confirmation regarding their eligibility to continue as the StatutoryAuditors of the Company.
Your Directors requested to ratify the appointment of M/s Das & Prasad CharteredAccountants as the Statutory Auditors of the Company at the ensuing AGM. The observationsof the Auditors when read together with the relevant notes to the accounts and accountingpolicies are self- explanatory.
B. Secretarial Auditor
As per the provisions of Section 204 of the Companies Act 2013 the Board of Directorshave appointed M/s K. Arun & Co Company Secretaries as Secretarial Auditor to conductSecretarial Audit of the Company for the financial year ended on March 31 2017.
Secretarial Audit Report issued by M/s K. Arun & Co Company Secretaries in FormMR-3 is enclosed as Annexure - 5 to this Report.
There is no reservation qualification or adverse remark contained in the SecretarialAudit Report. Information referred in Secretarial Audit Report are self-explanatory anddon't call for any further comments.
21. RISK MANAGEMENT
The Company manages risk through a detailed Risk Management Policy framework which laysdown guidelines in identifying assessing and managing risks that the businesses areexposed to. Risk is managed through appropriate structures that are in place at GoldenGoenka Fincorp Limited including suitable reporting mechanisms.
Further kindly refer to the write-up in the Section Management Discussion and AnalysisReport.
22. PARTICULARS OF EMPLOYEES REQUIRED UNDER SECTION 197(12) READ WITH RULE 5 OF THECOMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014 AND COMPANIES(APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) AMENDMENT RULES 2016
The prescribed particulars of remuneration of employees pursuant to Section 197(12)read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 and Companies (Appointment and Remuneration of Managerial Personnel) AmendmentRules 2016 are set out as Annexure - 6 to this Report.
23. STATEMENT ON DECLARATION GIVEN BY THE INDEPENDENT DIRECTOR UNDER SUB SECTION (6) OFSECTION 149 OF COMPANIES ACT 2013
All the Independent Directors of your Company have submitted a declaration at the timeof their appointment and also annually that they meet the criteria of independence as laiddown under Section 149(6) of the Act and SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. All requisite declarations were placed before the Board.
In accordance with the provisions of Section 152 of the Act and your Company's Articlesof Association Mr. Girdhari Lal Goenka (DIN: 00613725) retires by rotation at the ensuingAGM and being eligible offers himself for re-appointment.
Subjected to the approval of members at the ensuing Annual General Meeting of theCompany the Board of Directors at its meeting held on 14th August 2017considered and approved the appointment of both Mr. Udai Kothari (DIN: 00284256)designated as Executive Chairman & Managing Director and Mr. Deepak Kothari(DIN:-00280323) designated as Whole-time Director of the Company for a period of 3 yearswith effect from 21st September 2017.
The information as required to be disclosed under Regulation 36(3) of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 in case of re-appointment/appointment of the director is provided in the Corporate Governance Section forming partof this Report.
25. CHANGE IN THE NATURE OF THE BUSINESS IF ANY
During the year under review there is no change in the nature of the business.
26. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / COURTS /TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND YOUR COMPANY'S OPERATIONS IN FUTURE
During the year under review there were no such orders passed by the regulators /courts / tribunals impacting the going concern status and your Company's operations infuture.
27. BOARD EVALUATION
In compliance with the requirements of the provisions of Section 178 of the CompaniesAct 2013 read with Rules framed thereunder and provisions of Schedule IV to the Act aswell as the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 yourCompany has carried out performance evaluation for the Board of Directors Committees ofthe Board and Individual Directors on the basis of participation of directors quality ofinformation available quality of discussions contributions and decision making etc. Theoverall performance of the members of the Board was found satisfactory. The manner inwhich the evaluation is carried out has been explained in the Corporate Governance Sectionforming part of this Report.
28. PARTICULARS OF CONTRACTS/ARRANGEMENTS WITH RELATED PARTIES
All transactions entered into with Related Parties as defined under the Companies Act2013 and Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 during the year were in the ordinary course of business and on an arms'length basis and do not attract the provisions of Section 188 of the Companies Act 2013.However pursuant to the provisions of Regulation 23 (2) of the SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 prior approval of the Audit Committee wassought for entering into the Related Party Transactions. Further the Audit Committeegranted omnibus approval for repetitive transactions to be entered into with the relatedparties during the year. The Audit Committee reviews all related party transactions on aquarterly basis. During the year the Company had not entered into any contract /arrangement / transactions with Related Parties which could be considered as material interms of Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. Accordingly the disclosure of Related Party Transactions pursuant toSection 134 (3)(h) of the Companies Act 2013 in Form AOC-2 is not applicable. Inaccordance with Accounting Standard 18 the Related Party Transactions are disclosed underNote No. 28 of the Standalone Financial Statements.
However the Board of Directors of the Company at its meeting held on 19thJanuary 2017 considered and approved the disinvestment of the entire shares of one of itsmaterial wholly owned subsidiary viz Aristro Capital Markets Limited to one or moreentities subjected to the Shareholders approval vide Postal Ballot. Further as per thecombined Scrutinizer Report on E-voting & Postal Ballot dated 21st March2017 issued by Mr. Prateek Kohli Practising Company Secretary (CP No 16457) Proprietorof M/s Prateek Kohli & Associates Company Secretaries the Scrutinizer the membersof our Company had approved the proposal of disinvestment of the M/s Aristro CapitalMarkets Limited to one or more entities. The transaction for sale of shares is pending forregulatory approvals.
A Policy on the Related Party Transactions has been devised by your Company fordetermining the materiality of transactions with related parties and dealings with them.The said Policy is available on your Company's website www.goldengoenka. com and aweb link to the said Policy has been provided in the Corporate Governance Section formingpart of this Report.
29. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
Kindly refer to the write-up in the Section Management Discussion and Analysis Report.
30. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has established a Vigil Mechanism / Whistle Blower Policy for directors andemployees to report to the management instances of unethical behavior actual orsuspected fraud or violation of the Company's code of conduct or ethics policy if any.
The Policy is also available on the Company's website and the web link of the same is: http://www.goldengoenka.com/images/GGFL-WhistleBlowerPolicy.pdf.
The Company has in place the Policy on Prevention of Sexual Harassment of Women atWorkplace in accordance with The Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013.
During the financial year ended 31st March 2017 the Company has notreceived any Complaints pertaining to Sexual Harassment.
32. NOMINATION AND REMUNERATION COMMITTEE
During the financial year 2016-17 one Nomination and Remuneration Committee Meeting washeld on 22.08.2016. The Composition of the Committee has been provided in the CorporateGovernance Section forming part of this Report. The terms of reference of the Committeeare wide enough to cover matters specified for the Committee under SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 and Section 178 of theCompanies Act 2013.
The Company's Remuneration Policy has been provided in the Corporate Governance Sectionforming part of this Report.
33. CORPORATE SOCIAL RESPONSIBILITY
In terms of Section 135 and Schedule VII of the Companies Act 2013 the Board ofDirectors have constituted a Corporate Social Responsibility (CSR) Committee and on therecommendation of the said committee the Board has approved a Corporate SocialResponsibility (CSR') policy and the same has been uploaded in the website of theCompany www.goldengoenka.com which contains the CSR activities being carried out bythe Company governance structure implementation process etc.
Your Directors are pleased to inform that the Company has fulfilled its CSR obligationspursuant to Section 135(5) of the Companies Act 2013 for the year 2016-17 inter-alia onCSR projects in the areas of education. The details on CSR activities as prescribed underCompanies (Corporate Social Responsibility Policy) Rules 2014 are provided as Annexure- 7 and forms part of this Report.
34. OTHER DISCLOSURES
In March 2015 search and seizure operations were conducted by the Income TaxAuthorities under Section 132 of the Income Tax Act. During the course of the search andseizure operations the Income Tax Authorities have taken custody of certain materialssuch as documents records and recorded statements of certain officials of the Company.The Company does not expect any liability arising out of the aforesaid search and seizure.
35. OPEN OFFER TO THE SHAREHOLDERS
During the year under review the present Promoters of our Company viz Mr. GirdhariLal Goenka M/s. Girdhar Fiscal Services Private Limited M/s. Golden Goenka CommercePrivate Limited and M/s. Golden Goenka Credit Private Limited have entered into a SharePurchase Agreement dated 30.01.2017 for sale of their entire shareholding in the Companyconstituting 95536854 fully paid-up equity shares of face value of Rs. 5/- eachrepresenting 50.22% of the total equity and voting share capital of the Company with
Mr. Deepak Kothari (Acquirer 1) Mr. Udai Kothari (Acquirer 2) and M/s. Lotus CapitalFinancial Services Limited (Acquirer 3). Subsequently the Acquirers alongwith M/s. U.Y.Industries Private Limited (PAC 1) and Dipak Kothari (HUF) (PAC 2) have initiated an OpenOffer under Regulation 3(1) and 4 of the SEBI (SAST) Regulations 2011 vide PublicAnnouncement dated 30.01.2017. Thereafter pursuant to receipt of the Statutory approvalsfrom the Securities and Exchange Board of India and Reserve Bank of India the Acquirersand the PACs acquired 2600 equity shares from the public shareholders in the tenderingperiod which opened on 19th June 2017 and closed on 3rd July 2017.
Subsequent to the aforesaid acquisitions the Acquires along with the PACs now hold106613254 fully paid up equity shares of face value of Rs. 5/- each representing 56.04%of the entire equity share capital of the Company.
Your Directors would like to express their grateful appreciation for the excellentsupport and co-operation received from the Banks RBI SEBI MCA Registrar and ShareTransfer Agents Registrar of Companies Stock Exchanges Depositories CustomersBusiness Associates Members and other Stakeholders during the year under review. YourDirectors also place on record their deep appreciation for the valuable contribution ofthe employees at all levels for the progress of your Company during the year and lookforward to their continued co-operation in realisation of the corporate goals in the yearsahead.
| || |
For and on behalf of the Board
| || |
| || |
CA G. L. Goenka
|Place: Kolkata || |
(Chairman & Managing Director)
|Date: 14th August 2017 || |