HB Leasing & Finance Co Ltd.
|BSE: 508956||Sector: Financials|
|NSE: N.A.||ISIN Code: INE549B01016|
|BSE LIVE 13:46 | 12 Dec||2.66||
|NSE 05:30 | 01 Jan||Stock Is Not Traded.|
HB Leasing & Finance Co Ltd. (HBLEASINGFIN) - Director Report
Company director report
The Directors are pleased to present the 33rd Annual Report together withthe Audited Financial Statements for the year ended 31st March 2016.
The Financial Results of the Company during the year under review are summarized asunder:-
(Rs. in Lakhs)
In view of the brought forward losses your directors regret their inability torecommend dividend for the year under review.
PERFORMANCE REVIEW & OUTLOOK
During the year the BSE sensitive Index was at 27597 at the start of the financialyear and ended at 25479 in March 2016. The year was marked by high volatility in thestock market. As a result the Divestment/ Investment activity of the Company wascurtailed during the year and the Company posted a Gross Profit of Rs. 43.20 Lakhs ascompared to Gross profit of '33.32 Lakhs in the previous year. Net Loss after tax for theyear under review was ' (43.48) Lakhs as compared to the net profit of Rs. 31.68 Lakhs inthe previous year.
According to IMF World Economic Outlook overall Indian economy is expected to grow at7.00-7.75 per cent during FY 2016-17 despite the uncertainties in the global market. GDPGrowth is projected to be stronger in 2016 as compared to 2015.The medium term to longterm growth prospects look positive in view of the Government's determination to bring inreforms. For the year 2016 the economy is expected to grow at a higher rate than in 2015.The long term prospect for the economy is optimistic.
Industry Trends and its future prospects have been summed up in the ManagementDiscussion and Analysis Report which forms part of this report.
(i) Share Capital
The Paid up Equity share capital as on 31st March 2016 is Rs. 110041095/-. Duringthe year under review the Company has neither issued shares with differential votingrights nor granted stock options or sweat equity.
The Shareholding of Directors of the Company (including Promoter Director) is given inthe Corporate Governance Report forming part of this report.
(ii) No. of meeting(s) of the Board
During the year four (4) Board Meetings were convened and held. The details of theBoard Meetings are given in the Corporate Governance Report. The intervening gap betweenthe Meetings was within the period prescribed under the Companies Act 2013.
(iii) Public Deposits
Your Company has neither invited nor accepted any deposits from the public /shareholders pursuant to Section 73 of the Companies Act 2013 read with the Companies(Acceptance of Deposits) Rules 2014 during the year under review.
(iv) Significant and other material orders passed by the Regulators or Courts
There are no significant material orders passed by the Regulators / Courts or Tribunalduring the year under review which has an impact on the Going Concern status and Company'soperations in the future.
(v) Particulars of Loans Guarantees or Investments under section 186
Details of Loans Guarantees or Investments made by the Company in the ordinary courseof business covered under the provisions of Section 186 of the Companies Act 2013 aregiven in the notes to the Financial Statements.
(vi) Particulars of Contracts or Arrangements with Related Parties
Details of Contracts or arrangements covered under the provisions of Section 188 of theCompanies Act 2013 are given in the notes to the Financial Statements.
(vii) Conservation of Energy Technology Absorption and foreign and outgo
The particulars under Section 134(3)(m) of the Companies Act 2013 read with Rule 8 ofthe Companies (Accounts) Rules 2014 with regard to conservation of energy and technologyabsorption are not applicable to the Company. During the year under review there were noearnings or outgo in foreign exchange.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(3)(c) and sub-section (5) of the Companies Act 2013 Directorsof your Company hereby state and confirm that:
a) in the preparation of the Annual Accounts for the year ended 31st March 2016 theapplicable accounting standards have been followed along with proper explanation relatingto 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 the same period;
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) they have prepared the annual accounts on a going concern basis;
e) they have laid down internal financial controls in the company that are adequate andwere operating effectively.
f) they have devised proper systems to ensure compliance with the provisions of allapplicable laws and these are adequate and are operating effectively.
DECALARATION BY INDEPENDENT DIRECTORS
The Company has received declarations from Mr. L.N. Malik and Mrs. Meenakshi GopalIndependent Directors of the Company confirming that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and applicableprovisions as per Regulation 16 of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
MANAGEMENT DISCUSSION & ANALYSIS AND CORPORATE GOVERNANCE REPORT
As required under Regulation 34(3) read with Schedule V of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Management Discussion& Analysis Report; a Report on the Corporate Governance together with the ComplianceCertificate from the Company's Statutory Auditor's confirming compliance(s) forms anintegral part of this report.
WHISTLE BLOWER POLICY -VIGIL MECHANISM
In terms of the provisions of Sec 177(9) & (10) of the Companies Act 2013 andRegulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015a Vigil Mechanism for Stakeholders Employees and Directors of the Company has beenestablished. The Whistle Blower Policy duly approved by the Board of Directors has beenuploaded on the website of the Company viz.www.hbleasing.comhaving following web link www.hbleasing.com/Investor Information/Corporate Governance.
RELATED PARTY TRANSACTIONS
All Related Party Transactions entered during the year were in Ordinary Course of theBusiness and on Arm's Length basis. There were no materially significant Related PartyTransactions entered into by the Company during the year under review. Accordingly thedisclosure of Related Party Transactions as required under Section 134(3)(h) of theCompanies Act 2013 in Form AOC-2 is not applicable. None of the Directors has anypecuniary relationships or transactions vis-a-vis the Company.
The Board of Directors on the recommendation of the Audit Committee has approved aPolicy to regulate transactions between the Company and its Related Parties in compliancewith the applicable provisions of the Companies Act 2013 the Rules made there under andRegulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015. The policy on Related Party Transactions has been uploaded on the website of theCompany www.hbleasing.com.
CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING
The Company endeavors to preserve the confidentiality of un-published price sensitiveinformation and to prevent misuse of such information. The Company is committed totransparency and fairness in dealing with all Stakeholders and in ensuring adherence toall laws and regulation in force.
The Board of Directors has adopted the Code of Conduct for regulating monitoring andreporting of trading by insiders and other connected persons in compliance withRegulation 9 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015. The Code of Conduct lays down guidelines and procedures to be followed anddisclosures to be made while dealing with the Shares of the Company as well as theconsequences of violation. The Code of Conduct has been formulated for prevention ofInsider Trading and to maintain the highest standards of dealing in Company Securities.
PRESERVATION OF DOCUMENTS & ARCHIVAL POLICY
In terms of Regulation 9 of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 the Board of Directors intheir meeting held on 12th February 2016 has adopted a Policy for Preservation ofDocuments & Archival thereof classifying them in two categories as follows:
(a) documents whose preservation shall be permanent in nature;
(b) documents with preservation period of not less than eight years after completion ofthe relevant transactions.
The said Policy has been uploaded on the website of the Company
DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY
The Board of Directors has adopted the Risk Management Policy which sets out theframework for the management of risks faced by the Company in the conduct of its businessto ensure that all business risks are identified managed and monitored. The contents ofRisk Management Policy have been included in Management Discussion and Analysis formingpart of this report.
PREVENTION OF SEXUAL HARRASMENT OF WOMEN AT WORKPLACE
The Company has zero tolerance for sexual harassment at workplace. The Board ofDirectors in their meeting held on 28th May 2016 has reconstituted the Internal ComplaintCommittee as per the provisions of the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 and the rules framed there under. TheInternal Complaint Committee comprises of following members:
i. Mrs. Banmala Jha Presiding Officer (Senior V.P. Legal - HB Stock Holdings Limited)
ii. Mrs. Madhu Suri Member (Working in the Delhi Legal Services Authority as aCounsellor)
iii. Mr. Anil Goyal Member (Managing Director)
iv. Ms. Sukhmani Walia Member (Company Secretary)
The functions of the Committee are mentioned in the Corporate Governance Report. Nocomplaint was received during the year and no complaint was pending to be resolved as on31.03.2016.
INTERNAL CONTROLS SYSTEMS AND THEIR ADEQUACY
The Company has proper and adequate system of Internal Controls. The information aboutInternal Controls is set out in the Management Discussion and Analysis forming part ofthis report.
INTERNAL FINANCIAL CONTROLS
The Company has established Internal Financial Control System for ensuring the orderlyand efficient conduct of the business including adherence to Company's Policies thesafeguarding of assets the prevention and detection of frauds and errors the accuracyand completeness of the accounting records and the timely preparation of reliableFinancial Statements.
AUDITORS OF THE COMPANY
a) Statutory Auditors
M/s. P. Bholusaria & Co. Chartered Accountants New Delhi (FRN 000468N) theStatutory Auditors of the Company shall hold office till the conclusion of the ensuingAnnual General Meeting and being eligible offers themselves for reappointment. The Companyhas received a letter from them to the effect that their re-appointment if made would bewithin the prescribed limits under Section 141(3)(g) of the Companies Act 2013 and theyare not disqualified for re-appointment. Observations of the Statutory Auditors areexplained wherever necessary by way of Notes to the Financial Statements.
b) Internal Auditors
M/s. M.K. Choudhary & Co. Chartered Accountants New Delhi performs the duties ofthe Internal Auditors of the Company and their report is reviewed by the Audit Committeeon quarterly basis .
c) Secretarial Auditors
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial personnel) Rules 2014 the Company hasappointed Mr. Amar Nath Kukreja M/s. A. N. Kukreja & Co. Company Secretary inPractice to undertake the Secretarial Audit of the Company. The Secretarial Audit Reportis enclosed as a part of this report as "ANNEXURE - I".
DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)
(a) Appointment / Re-appointment / Resignation of Directors and KMP
As per the provisions of Section 152 of the Companies Act 2013 Mr. Lalit Bhasin (DIN:00002114) Director (Chairman) shall retire by rotation at the ensuing Annual GeneralMeeting and being eligible offers himself for re-appointment. The Board of Directorsrecommends his re-appointment.
Ms. Swati Vaish has resigned from the position of the Company Secretary with effectfrom 5th March 2016. In pursuance to the provisions of Section 203 with Rule 8 ofCompanies (Appointment and Remuneration) Rules 2014 and other applicable provisions(including any modification or re-enactment thereof) if any of the Companies Act 2013the Board of Directors in the Board Meeting held on 28th May 2016 has appointed Ms.Sukhmani Walia as the Company Secretary and Compliance Officer being designated as KeyManagerial Personnel of the Company.
The Company has also received declarations from all the Independent Director(s)confirming that they meet with the criteria of Independence as prescribed both underSection 149(6) of the Companies Act 2013 and under Regulation 16(1)(b) 25(1) of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.
(b) Nomination and Remuneration Policy
The Board of Directors has on the recommendation of the Nomination and RemunerationCommittee approved a policy for selection appointment & remuneration includingcriteria for determining qualifications positive attributes of Directors Key ManagerialPersonnel (KMP) and Senior Management employees of the Company in pursuant to theprovisions of Section 178 of the Companies Act 2013 and Regulation 19 read with Part D ofSchedule II of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
The said policy forms a part of this Report as "Annexure IN".
(c) Board Diversity
The Company recognizes the importance and benefits of having the diverse Board toenhance quality of its performance.
The Company believes that a diverse Board will enhance the quality of the decisionsmade by the Board by utilizing the different skills qualification professionalexperience gender knowledge etc. of the members of the Board necessary for achievingsustainable and balanced growth of the Company. The Board of Directors on therecommendations of the Nomination and Remuneration Committee has adopted a Policy onDiversity of
Board of Directors in terms of Regulation 19 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.
(d) Board Evaluation
Pursuant to the provisions of the Companies Act 2013 and Regulation 19 (4) as perSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 the Board has carried out an annual performance evaluation of its ownperformance the directors individually as well as the evaluation of the working of itsAudit Nomination and Remuneration and Compliance Committees. The manner in which theevaluation has been carried out is explained in the Corporate Governance Report.
(e) Remuneration of the Directors / Key Managerial Personnel (KMP) and Particulars ofEmployees
The provisions of Rule 5(2) & 5(3) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 are not applicable as there are no such employee whowere drawing / in receipt of remuneration of prescribed amount during the period underreview.
The Company has one Executive Director Mr. Anil Goyal. No remuneration is paid to himas he holds the office of the Managing Director of HB Portfolio Limited and opts to drawhis remuneration from HB Portfolio Limited. The non-executive directors are paid onlysitting fees for attending the meeting of the Board of Directors and the Committeesconstituted by the Board.
The information required pursuant to Section 197(12) of the Companies Act 2013 readwith Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 in respect of Directors / Key Managerial Personnel (KMP) and Employees of the Companyis furnished hereunder:
(i) the ratio of the remuneration of each Director to the median remuneration of theemployees of the Company for the financial year &
(ii) the percentage increase in remuneration of each Director Chief Financial OfficerChief Executive Officer Company Secretary or Manager if any in the financial year.
*Ms. Swati Vaish resigned from the position of the Company Secretary w.e.f 5th March2016
(iii) the number of permanent employees on the rolls of Company.
(iv) the explanation on the relationship between average increase in remuneration andCompany performance.
(v) comparison of the remuneration of the Key Managerial Personnel against theperformance of the Company.
(vi) variations in the market capitalisation of the Company price earnings ratio as atthe closing date of the current financial year and previous financial year and percentageincrease over decrease in the market quotations of the shares of the Company in comparisonto the rate at which the Company came out with the last public offer in case of listedcompanies and in case of unlisted companies the variations in the net worth of theCompany as at the close of the current financial year and previous financial year.
(vii) average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration.
(viii) Comparison of the each remuneration of the Key Managerial Personnel against theperformance of the Company.
* Ms. Swati Vaish resigned from position of Company Secretary w.e.f. 05.03.2016
(ix) the key parameters for any variable component of remuneration availed by thedirectors.
(x) the ratio of the remuneration of the highest paid director to that of the employeeswho are not directors but receive remuneration in excess of the highest paid directorduring the year. None
(xi) The remuneration paid to the Directors / Key Managerial Personnel (KMP) is inaccordance with the remuneration policy of the Company.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of Annual Return is required under section92(3) of the Companies Act 2013 in Form MGT-9 in annexed herewith as "AnnexureIV".
Your Directors wish to thank and acknowledge the co-operation assistance and supportextended by the Banks Company's Shareholders and Employees.
For and on Behalf of The Board
HB LEASING AND FINANCE COMPANY LIMITED
DIN : 00002114
Place : Gurgaon
Date : 28th May 2016