OF HASTI FINANCE LIMITED
Your Directors have pleasure in presenting the 23rd Annual report of the Companytogether with the audited Financial Statements for the year ended 31st March 2017.
1. FINANCIAL RESULTS:
The financial results of your company for the year ended 31st March 2017 aresummarized below:
| || ||Amount in lakhs' |
|Particulars For the Year ended ||For the year ended 31 st March 2017 ||For the year ended 31 st March 2016 |
|Gross Income ||136.19 ||145.61 |
|Less: Expenses ||121.02 ||195.46 |
|Profit / (Loss) Before ||15.17 ||(49.85) |
|Interest Depreciation and amortization exceptional items and Tax || || |
|Less: Depreciation and amortization ||12.78 ||3.13 |
|Profit / (Loss) before exceptional items and tax ||2.39 ||(52.98) |
|Add: Exceptional Item ||- ||- |
|Profit / (Loss) before Tax ||2.39 ||(52.98) |
|Less/ (Add) : Provision for Taxation ||0.02 ||(0.65) |
|Profit / (Loss) after Tax ||2.37 ||(52.33) |
|Add: Balance brought forward from previous year ||194.63 ||246.96 |
|Profit availabl e before appropriations ||197.00 ||194.63 |
|Less: Appropriations ||NIL ||NIL |
|Surplus Carried to balance Sheet ||197.03 ||194.63 |
During the year the Income earned by the company comprises of interest income of Rs.127.39 Lac and Long Term Capital Gain on sale of investment of Rs. 8.81 Lac (PreviousYear: Rs. 144.89 Lac and Rs. NILrespectively)
Following the RBI guidelines for income recognition and provision norms the Companyhas provided a sum of Rs. 6.50 Lac for Contingent Provision against standard assets whichhas resulted in a net operational profit after tax of Rs. 2.37 Lacs as compared to lossafter tax of Rs.52.33 Lacs during the previous year. The Company's Net Worth as on March31 2017 stood at Rs. 2505.57 Lacs as against Rs. 2503.20 Lacs last year.
Since the Company has earned inadequate profits no dividend is recommended. Yourdirectors are of the opinion that in order to keep the pace of the growth the Companyneeds to maintain its reserves and hence do not recommend any dividend distribution out ofthe reserves.
3. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND:
The provisions of Section 125(2) of the Companies Act 2013 do not apply as there wasno dividend declared and paid last year.
4. REVIEW OF BUSINESSOPERATIONSAND FUTURE PROSPECTS
Your Directors wish to present the details of Business operations done during the yearunder review:
a. Business Operations and Profitability: The Company is Non Banking FinanceCompany listed on BSE ASE & MSE. To enhance the growth of the company by capturinghuge market area the company has lowered down the rate of interest due to which thecompany is experiencing decrease in total revenue of the company in the current financialyear compare to earlier financial year. Due to lower margins the profitability of theCompany has been affected and company has nominal profit after tax of Rs. 2.37 Lac only.
b. Sales of Services: The company is covered under the category of Loan Companywithin the broad category of Non Deposit accepting Non-Banking Finance Company. The targetsector of the Company is Small business man and middle class households. Accordingly mainproducts offered by the company are Unsecured Business and Personal Loan and Gold Loan.
c. Marketing and Market environment: The Company is carrying on its businessactivities on medium scale and therefore huge and extensive marketing strategies are notadopted by the company. The company has adopted small scale business marketing strategies.The company is carrying on business of providing finance and there is huge competition inthe market in this type ofbusiness sector.
d. Future Prospects including constraints affecting due to Government policies: Ourorganization is putting efforts in collecting its bad debts from customers and trying toenhance its customer base through advertisements and different marketing strategies soadopted by the company. The company is expecting more revenue in upcoming years. There areno specific industrial or Government policies which restrict the business or growth of thecompany.
5. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTSRELATE AND THE DATE OF THE REPORT
No material changes and commitments affecting the financial position of the Companyoccurred between the end of the financial year to which this financial statements relateon the date of this report.
6. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGSANDOUTGO
The provisions of Section 134(m) of the Companies Act 2013 do not apply to ourCompany. There was no foreign exchange inflow or Outflow during the year under review.
7. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THECOMPANY
The Companydoes not have any Risk Management Policy as the elements of risk threateningthe Company's existence are very minimal.
8. DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIALRESPONSIBILITY INITIATIVES
The provisions of Section 135 of the Companies Act 2013 do not apply to our Company.Hence the company has not developed and implemented any corporate social responsibilityinitiatives.
9. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THECOMPANIES ACT 2013
There were no loans guarantees or investments made by the Company under Section 186 ofthe Companies Act 2013 during the year under review and hence the said provision is notapplicable.
10. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
During the year the Company had not entered into any contract/ arrangement/transaction with related parties which could be considered material in accordance with thePolicy on Related Party Transactions. Pursuant to section 134(3) (h) read with Rule 8(2)of the Companies (Accounts) Rules 2014 there are no transactions to be reported underSection 188(1) of the Companies Act 2013.
11. AUDITORS REPORT
There were no qualifications reservations or adverse remarks made by the Auditors intheir Audit reports.
12. SECRETARIAL AUDIT REPORT
A Secretarial Audit Report given by Dipak Maniar & Co. a company secretaryin practice is furnished in Annexure "A"and is attached to this report.
13. COMPANY'S POLICY RELATING TO DIRECTORS APPOINTMENT PAYMENT OF REMUNERATION ANDDISCHARGE OF THEIR DUTIES
The Company's Policy relating to appointment of Directors payment of Managerialremuneration Directors' qualifications positive attributes independence of Directorsand other related matters as provided under Section 178(3) of the Companies Act 2013 isfurnished in Annexure "B" and is attached to this report.
14. ANNUAL RETURN
The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule12 of the Companies (Management and administration) Rules 2014 is furnished in Annexure"C" and is attached to this Report.
15. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW
The Company has held 7 Board meetings during the financial year under review.
16. DIRECTORS RESPONSIBILITYSTATEMENT
In accordance with the provisions of Section 134(5) of the Companies Act 2013 theBoard hereby submit its responsibility Statement:
(a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
(b) the directors had 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 at the end of the financial year and ofthe profit of the company for that period;
(c) the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
(d) the directors had prepared the annual accounts on a going concern basis; and
(e) the directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively
(f) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
17. SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
The Company does not have any Subsidiary or Joint venture Company. The details ofFinancial performance of the associate companies are furnished in Annexure "D"and attached to this report.
Our company is a Non deposit accepting Non Banking Financial Company during the yearunder review the Company has neither accepted nor renewed any deposit during the yearunder review.
Mr. Nitin Prabhudas Somani has completed his tenure as Managing Director of the Companyas on 30.09.2016. In the 22nd Annual General Meeting members have unanimously approvedhis reappointment as Managing Director of the Company for a period of five yearscommencing from 1st October 2016 to 30th September 2021.
20. DECLARATION OF INDEPENDENT DIRECTORS
The Independent Directors have submitted their disclosures to the Board that theyfulfill all the requirements as stipulated in Section 149(6) of the Companies Act 2013 soas to qualify themselves to be appointed as Independent Directors under the provisions ofthe Companies Act 2013 and the relevant rules.
21. PARTICULARS OF EMPLOYEES
Information as per Rule 5(1) of chapter XIII Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014
Information under Rule 5(1)(i) & (ii)
|Name of Director ||Designation ||Remuneration in year 2017 ||Remuneration in year 2016 ||Remuneration of Employee s ||% increase in remuneration during the year ||Ratio of remuneration to MRE |
| || ||(Rs. In Lacs) ||(Rs. In Lacs) ||(Rs. In Lacs) || || |
|Nitin Prabhu -das Somani ||Managing Director ||1.92 ||1.92 ||54.92 ||25.63% ||3.50% |
Information under Rule 5(1) (iii) & (iv)
|Total number of employees during the year 2017 ||Total number of employees during the year 2016 ||Remuneration of employees n i year 2017 ||Remuneration of employees in year 2016 ||% increase / (decrease) in remuneration of employees during the year |
| || ||(Rs. In Lacs) ||(Rs. In Lacs) || |
|24 ||26 ||54.93 ||43.72 ||25.64% |
Information under Rule 5(1) (v)
The total revenue of the company during the financial year 2017 is Rs. 127.39 Lacscompare to Rs.144.89 Lacs in the financial year 2016. The net profit earned by the companyduring financial year was Rs. 2.39 Lacs as compared to net loss of Rs. 52.98 Lacs in thefinancial year 2016 after charging contingency provision for standard assets of Rs. 6.50(previous year Rs. 4.56 Lac)
There is no change in percentage of remuneration paid to Managing Director during theyear as compare to earlier financial year. The remuneration paid to employees in thefinancial year 2016 was Rs.43.72 Lacs and in the year 2017 is Rs.54.93 Lacs.
Information under Rule 5(1) (vii)
Market capitalization of the company has decrease from Rs. 1555.50 Lacs at March 2016to Rs.861.76 Lacs as at March 2017. The closing price of company's equity shares as of31st March 2016 and 31st March 2017 is Rs. 14.35/- per share and Rs.7.95/- per sharerespectively representing percentage decrease of 84.05% as at March 2016 and 91.17% as atMarch 2017 over the last offer price ofRs. 90/- per share
22. FORMALANNUAL EVALUATION
Clause 49 of the Listing agreement mandates that the board shall monitor and review theBoard evaluation framework. The CompaniesAct 2013 states that a formal annual evaluationneeds to be made by the Board of its own performance and that of its committees andindividual directors. Schedule IV of the Companies Act 2013 states that the performanceevaluation of independent directors shall be done by the entire Board of Directorsexcluding the director being evaluated.
The evaluation of all the directors and the Board as a whole was conducted based on thecriteria and framework adopted by the Board. The board approved the evaluation results ascollated by the Nomination and remuneration committee.
23. STATUTORY AUDITORS
M/s. Sandeep Rathi & Associates Chartered Accountants Mumbai wasappointed as the statutory auditor of the Company for a period of 3 years. The firm hascompleted his tenure of an auditor of the company according to the provisions of section139(2) and therefore the board has recommended appointment of M/s Randhir KumarJhunjhunwala &Co. Chartered accountants (Firm Registration No. 113675W) as theStatutory Auditor of the Company to hold office from the conclusion of this Annual GeneralMeeting till the conclusion of the Annual General Meeting of the Company to be held in theyear 2022 subject to ratification by members at every Annual General Meeting.
None of the Directors are interested in the resolution.
24. WHISTLEBLOWER POLICY
The Board has adopted whistleblower mechanism in the company. The policy adopted by thecompany is attached in Annexure "D" to the report.
25. DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL MECHANISM
The Audit Committee consists of the following members.
a. Mr. Manoj Kumar Padhye
b. Mr. Vilas Shankar Daware
c. Mr. Vishal Nanalal Buddhadev
The above composition of the Audit Committee consists of all independent Directors.
The Company has established a vigil mechanism and overseas through the committee thegenuine concerns expressed by the employees and other Directors. The Company has alsoprovided adequate safeguards against victimization of employees and Directors who expresstheir concerns. The Company has also provided direct access to the chairman of the AuditCommittee on reporting issues concerning the interests of co employees and the Company.
a. BUY BACK OF SECURITIES
The Company has not bought back any of its securities during the year under review.
The Company has not issued any Sweat Equity Shares during the year under review.
c. BONUS SHARES
No Bonus Shares were issued during the year under review.
d. EMPLOYEES STOCK OPTION PLAN
The Company has not provided any Stock Option Scheme to the employees.
27. CORPORATE GOVERNANCE REPORT:
The report on Corporate Governance required as per clause 49 of the listing agreementis attached in Annexure "E" to the Board report.
28. CORPORATE GOVERNANCE CERTIFICATE
The certificate from the auditors regarding compliance of conditions of corporategovernance as stipulated in Clause 49 of the Listing agreement i s attached inAnnexure"F" to the report.
Your Directors place on record their sincere thanks to bankers business associatesconsultants and various Government Authorities for their continued support extended toyour Companies activities during the year under review. Your Directors also acknowledgesgratefully the shareholders for their support and confidence reposed on your Company.
|FORAND ||ONBEHALFOFTHEBOARDOFDIRECTORS || |
| ||Sd/- ||Sd/ - |
| ||Nitin Somani ||Sonal Somani |
| ||Managing Director ||Director |
|Mumbai September 42017 ||DIN : 00841378 ||DIN :01216993 |