H.K. Trade International Limited
Your Directors are pleased to present the 4th Annual Report on the business andoperations of the Company and the accounts for the Financial Year ended March 31 2017.
1. FINANCIAL SUMMARY OR HIGHLIGHTS / PERFORMANCE OF THE COMPANY: The Board'sReport shall be prepared based on the stand alone financial statements of the Company.
|Particulars ||Year Ending March 2017 ||Year Ending March 2016 |
| ||Amt. in Rs. ||Amt. in Rs. |
|Total Income ||48123012 ||50567495 |
|Less: Expenditure ||46165686 ||48671718 |
|Profit/(Loss) before Interest Depreciation & Tax ||1957326 ||1895777 |
|Less: Interest ||21878 ||40666 |
|: Depreciation And Amortization Cost ||353653 ||353225 |
|Profit/(Loss) before Tax ||1581795 ||1501886 |
|Less: Tax Expense ||515630 ||489056 |
|Profit/(Loss) after Tax ||1066165 ||1012830 |
2. BRIEF DESCRIPTION OF THE COMPANY'S OPERATIONS DURING THE YEAR / STATE OFCOMPANY'S AFFAIR
During the current period your company has shown decrease in revenue to the extent of5.08 % from Rs. 5.06 crores during F.Y. 2015-16 to Rs. 4.81 crores during F.Y. 2016-17.PAT has shown an increase from Rs. 0.10 crores during F.Y. 2015-16 to Rs. 0.11 croresduring F.Y. 2016-17.
3. FINANCIAL YEAR
The report of Directors along with its Annexure Management Discussion and AnalysisCorporate Governance Report Financial Statements along with their Notes are prepared forthe period April 01 2016 to March 31 2017 (a period of 12 months). Pursuant to theprovisions of Section 2(41) of the Companies Act 2013 a financial year' inrelation to the Company means the period ending on the 31st day of March every year inrespect whereof financial statements of the Company is made. Your Company is in compliancewith the provisions of the Companies Act 2013.
The company has decided to sustain the growth in line with the long term growthobjective of the Company by retaining the profits and utilizing the same for opportunitiesin hand.
5. SHARE CAPITAL
The Paid up equity share capital as at March 31 2017 stood at Rs. 2.632 crores.
No amount has been transferred by the Company to Reserves during the year.
7. PUBLIC DEPOSITS
The Company has neither invited nor accepted any public deposits during the periodunder review.
8. SUBSIDIARY AND ASSOCIATE COMPANIES
Ason March 31 2017 the Company has no subsidiary or Associate Company or JointVenture Companies.
9. CONSOLIDATED FINANCIAL STATEMENT
The Company is not required to consolidate its financial statements in terms ofprovisions of Companies Act 2013 and rules thereunder.
10. DIRECTOR AND KEY MANEGERIAL PERSONNEL
In accordance with the provisions of the Section 152 Companies Act 2013 read withapplicable Rules if any Mrs. Megha Chandawalla retires by rotation at the ensuingAnnual General Meeting and being eligible offers herself for a re-appointment. As per theprovisions of the Companies Act 2013 Independent Directors have been appointed for aperiod of five years and shall not be liable to retire by rotation. All other Directorsexcept the Managing Director will retire at the ensuing Annual General Meeting and beingeligible offer themselves for re-election.
The Independent Directors of your Company have given the certificate of independence toyour Company stating that they meet the criteria of independence as mentioned underSection 149(6) of the Companies Act 2013. Mr. Kamlesh Kapadia and Mr. Santosh Sawant areIndependent Directors of the Company. Based on the confirmations received from Directorsnone of the Directors are disqualified from appointment under Section 164 of the CompaniesAct 2013.
The Company has appointed Mr. Chintan Mehta as the Chief Financial officer of theCompany and Mr. Mahesh Mehta as aManaging Director.
The policy on Director's appointment and remuneration including criteria fordetermining qualifications positive attributes independence of Director and alsoremuneration for Key Managerial Personnel and other employees forms part of the CorporateGovernance Report of this Annual Report.
11. DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to the Directors' Responsibility Statement referred to in clause (c) ofsub-section (3) of Section 134 of the Companies Act 2013 the Board of Directors of theCompany confirm that
in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation and there are no material departures from thesame; they had selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the company at the end of the financial year and of the profitand loss of the company for that period; they have taken proper and sufficient care forthe maintenance of adequate accounting records in accordance with the provisions ofCompanies Act 2013 for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities;
theyha veprepared the annual accounts on a going concern basis;
they have laid down internal financial controls for the Company and that such internalfinancial controls are adequate and were operating effectively and they have devisedproper systems to ensure compliance with the provisions of all applicable laws and thatsuch systems were adequate and operating effectively.
12. NUMBER OF MEETINGS OF THE BOARD
In the Financial Year 2016-17 the Board met Seven times. The meetings were held onApril 13 2016 May 04 2016 May 23 2016 September 03 2016 November 11 2016 5.December 10 2016 and March 31 2017. Frequency and quorum at these meetings were inconformity with the provisions of the Companies Act 2013 and SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 entered into by the company with the StockExchanges. All the Board members and the senior management personnel have affirmedcompliance with the Code of Conduct during the year ended on 31st March 2017.
13. COMMITTEES OF THE BOARD
1. Audit Committee
2. Nomination and Remuneration Committee
3. Stakeholders' Relationship Committee
Details of Committeeand their meetings are detailed in Corporate Governance Report.
14. BOARD EVALUATION
Pursuant to the provisions of Companies Act 2013 and SEBI ( Listing Obligations andDisclosure Requirements) Regulations 2015 the board has carried out an annualperformance evaluation of its own performance the Directors individually as well as theevaluation of the working of its Audit Committee Nomination and Remuneration Committeeand Stakeholders Relationship Committee. The manner in which the evaluation has beencarried out has been explained in the Corporate Governance Report.
15. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY THE COMPANY
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 (if any) are given in the notes to the FinancialStatements.
16. CONSERVATION OF ENERGY TECHNICAL ABSORPTION FOREIGN EXCHANGE
(A) Conservation of Energy
Your company is taking continuously taking initiatives to ensure optimum utilization ofenergy available in day to day operations. Your company uses energy efficient lightingdevices light fittings to save energy capacitor bank/devices to maintain power factorwhich are environment and power efficient.
(B) Technology Absorption
Your company is doing its business by ensuring optimum utilisation of its availableresources. Your company has not taken any research & development activity so far.
(C) Fore ign Exchange Earnings and Outgo
The Company has not incurred in foreign currency during the financial year 2016-17.
17. VIGIL MECHANISM AND WHISTLE BLOWER POLICY
The Company has a Whistle Blower Policy to report genuine concerns or grievances. TheWhistle Blower Policy has been posted on the website of the Company www.hktrade.in
18. NOMINATION AND REMUNERATION POLICY
The Board of Directors has framed a policy which lays down a framework in relation toremuneration of Directors Key Managerial Personnel and Senior Management of the Company.This policy also lays down criteria for selection and appointment of Board Members.
19. CORPORATE SOCIAL RESPONSIBILITY
The provisions of Section 135 of the Companies Act 2013 are not applicable to theCompany.
20. SIGNIFICANT AND MATERIAL OREDERSPASSED BY REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators/Courts that wouldimpact the going concern status of the Company and its future operations.
21. ADEQUACY OF INTERNAL CONTROL SYSTEM
The Company has adequate internal control systems for the business processes in respectof all operations financial reporting compliance with laws and regulations etc. Themanagement information system forms an effective and sound tool for monitoring andcontrolling all operating parameters. Regular internal audits ensure that responsibilitiesare executed effectively. The Audit Committee reviews the adequacy of internal controls onregular basis.
22. CODE OF CONDUCT
The Board has laid down a Code of Conduct for all Board members and senior managementpersonnelof the Company which is available on website of the company. The Company hasobtained confirmations for the compliance with the said code from all its Board membersand senior management personnel for the year ended March 31 2017.
23. DECLARATION OF INDEPENDENCE BY INDEPENDENT DIRECTORS
All the Independent Non-Executive Directors of the Company viz. Mr. Santosh Sawant Mr.Kamlesh Kapadia have submitted the declaration of independence as required pursuant toSection 149(7) of the Companies Act 2013 stating that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation16 (1) (b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.The Independent Directors have also confirmed that they have complied with the Company'sCode of Conduct.
24. STATUTORY AUDITORS
M/S. R T Jain & Co. LLP were appointed as Statutory Auditors of your Company at theAnnual General Meeting held on September 30 2016 for a term of five consecutive years. Asper the provisions of Section 139 of the Companies Act 2013 the appointment of Auditorsis required to be ratified by Members at every Annual General Meeting.
The Report given by the Auditors on the financial statements of the Company is part ofthe Annual Report. There has been no qualification reservation adverse remark ordisclaimer given by the Auditors in their Report.
25. EXTRACT OF ANNUAL RETURN
As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of annual return in MGT9 as a part of this Annual Report as Annexure I.
26. NOMINATION AND REMUNERATION COMMITTEE
The Company follows a policy on "Nomination and Remuneration of Directors Keymanagerial Personnel and Senior Management". The policy is approved by the Nomination& Remuneration Committee and the Board. More details on the same are given in AnnexureII.
27. RELATED PARTY TRANSACTIONS
Form AOC-2 as required under the Companies Act 2013 for related party transaction isannexed as Annexure III to the Directors Report.
28. SECRETARIAL AUDITORS
The Board of Directors have appointed M/s. R. M. Mimani & Associates as SecretarialAuditors to conduct SecretarialAudit for the Financial Year 2 016-17. The SecretarialAudit Report issued by M/s. R. M. Mimani & Associates Company Secretaries in Practiceis self-explanatory and does not call for further comments. The Secretarial Audit Reportand Management reply on the qualifications stated in the said Report forms a partofDirectors Report in Annexure IV.
29. AUDIT COMMITTEE
The composition of Audit Committee is as follows:
|Name of Directors ||Designation in Committee ||Category |
|Mr. Kamlesh Kapadia ||Chairman ||Non-Executive and Independent |
|Mr. Santosh Sawant ||Member ||Non-Executive Independent |
|Mr. Mahesh Mehta ||Member ||Chairman & Managing Director |
During the Financial Year 2016-17 Audit Committee met 4 times on May 23 2016September 03 2016 November 11 2016 February 13 2017. All the recommendations made bythe audit committee were accepted by the board. Frequency and quorum at these meetingswere in conformity with the provisions of the Companies Act 2013 Listing Agreement andSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 entered into bythe company with the Stock Exchanges.
30. BUSINESS RISK MANAGEMENT
The Company has a robust Business Risk Management (BRM) framework to identify evaluatebusiness risks and opportunities. This framework seeks to create transparency minimizeadverse impact on the business objectives and enhance the Company's competitive advantage.The business risk framework defines the risk management approach across the enterprise atvarious levels including documentation and reporting. The framework has different riskmodels which help in identifying risks trend exposure and potential impact analysis at aCompany level as also separately for business. The Company has adopted risk managementpolicy.
31. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
The Company has always believed in providing a safe and harassment free workplace forevery individual through various interventions and practices. The Company alwaysendeavours to create and provide an environment that is free from discrimination andharassment including sexual harassment. The Company has in place an Anti-Sexual HarassmentPolicy in line with the requirements of The Sexual Harassment of Women at the Workplace(Prevention Prohibition
& Redressal) Act 2013. Internal Complaints Committee (ICC) has been set up toredress complaints received regarding sexual harassment. All employees (permanentcontractual temporary trainees) are covered under this policy. No complaints werereceived by the company during the year for sexual harassment. In order to build awarenessin this area the Company has been conducting programmes in the organisation on acontinuous basis.
32. PARTICULARS OF EMPLOYEES
Particulars of employees as required u/s 134 of the Companies Act 2013 are not annexedsince there are no employees drawing remuneration of more than Rs. 6000000/- per annumduring the year under review if employed for full year or more than Rs. 500000/-permonth if employed for part of the year.
Further the information required pursuant to Section 197 of the Companies Act 2013(the Act) read with Rule 5 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 in respect of employees of the Company will be provided uponrequest. In terms of Section 136 of the Act the Report and Accounts are being sent to theMembers and others entitled thereto excluding the information on employees' particularswhich is available for inspection by the Members at the Registered Office of the Companyduring business hours on working days of the Company up to the date of the ensuing AnnualGeneral Meeting. If any Member is interested in obtaining a copy thereof such Member maywrite to the Compliance Officer in this regard.
33. GOODS AND SERVICE TAX
Goods and Services Tax (GST) is a landmark reform which will have a lasting impact onthe economy and on businesses. Implementation of a well-designed GST model that applies tothe widest possible base at a low rate can provide significant growth stimulus to thebusiness and contribute to the Prime Minister's mission of Make in India'. Whilethere are a few areas that need to be addressed the Government has applied GST from1stJuly 2017 and your Company will be ready for th is transformative reform.
34. MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report under requirements of SEBI (ListingObligation and Disclosure Requirements) Regulations 2015 forms part of this AnnualReport for the year ended 31st March 2017.
35. CORPORATE GOVERNANCE
With reference to the captioned subject and regulation 15(2) (b) of the saidregulations the compliance with the corporate governance provisions as specified inregulations 17 18 19 20 21 22 23 24 25 26 27 and clauses (b) to (i) ofsub-regulation 46 and para C D and E of the Schedule V shall not apply to those listedentity which has the specified securities on the SME Exchange. Further please note thatH.K. Trade International Limited is listed on the SME Platform of BSE Limited. HenceCompliance with above mentioned provisions relating to Corporate Governance are notapplicable and the Company is not required to file report on Corporate Governance Reporton quarterly basis with the Stock Exchange
36. VIGIL MECHANISM
The Vigil Mechanism of the Company which also incorporates a whistle blower policy interms of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015includes an Ethics & Compliance Task Force comprising senior executives of theCompany. Protected disclosures can be made by a whistle blower through an e-mail ordedicated telephone line or a letter to the Task Force or to the Chairman of the AuditCommittee. The Vigil Mechanism / Whistle Blower Policy has been uploaded on the Company'sWebsite i.e. www.hktrade.in
Statements in the Annual Report particularly those which relate to ManagementDiscussion and Analysis describing the Company's objectives projections estimates andexpectations may constitute forward looking statements' within the meaning ofapplicable laws and regulations. Although the expectations are based on reasonableassumptions the actual results might differ.
38. INTERNAL FINANCIALS CONTROLS
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weaknesses were observed.
39. HUMAN RESOURCES
Your Company treats its "human resources" as one of its most importantassets. Your Company continuously invest in attraction retention and development oftalent on an on-going basis. A number of programs that provide focused people attentionare currently underway. Your Company thrust is on the promotion of talent internallythrough job rotation and job enlargement. The Human Resource agenda continues to supportthe business in achieving sustainable and responsible growth by building the rightcapabilities in the organisation. It continues to focus on progressive employee relationspolicies creating an inclusive work culture and a strong talent pipeline.
40. TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND
Your Company did not have any funds lying unpaid or unclaimed for a period of sevenyears. Therefore there were no funds which were required to be transferred to InvestorEducation and Protection Fund (IEPF).
41. DISCLOSURE ABOUT COST AUDIT
As per the Cost Audit Orders Cost Audit is not applicable to the Company.
42. LISTING WITH STOCK EXCHANGES
The Company was listed on BSE SME segment for the Financial Year 2015-16. The Companyconfirms that it has paid the Annual Listing Fees for the year 2017-2018 to BSE where theCompany's Shares are listed.
43. APPRECIATIONS AND ACKNOWLEDGMENTS
The Directors wish to thank and deeply acknowledge the co-operation assistance andsupport extended by the Regulatory Authorities Company's Bankers Customers Shareholdersand other business constituents during the year under review. It will be your Company'sendeavour to build and nurture strong links with the trade based on mutuality of benefitsrespect for and co-operation with each other consistent with consumer interests. TheDirectors also wish to place on record their appreciation for all round co-operation andcontribution made by employees at all levels.
The Directors also take this opportunity to thank all Shareholders Clients VendorsBanks Government and Regulatory Authorities and Stock Exchanges for their continuedsupport.
For and on behalf of the Board H. K. Trade International Limited
|Sd/- ||Sd/- |
|Mahesh Mehta ||Megha Chandawalla |
|(Chairman & Managing Director) ||(Director) |
Place: Mumbai Date:September 04 2017