Your Directors are pleased to present the 6th Annual Report and Audited FinancialStatement of the Company for the year ended March 312017.
1. FINANCIAL RESULTS
|Particulars ||Current Year Ended March 31 2017 ||Previous Year Ended March 312016 |
|Gross Sales & Income from Operations ||811.23 ||2311.15 |
|Profit/(Loss) before Financial Cost and Depreciation ||(399.89) ||409.77 |
|Less: || || |
|- Finance Cost ||30.30 ||6.76 |
|- Depreciation & Amortization ||0.07 ||0.07 |
|Profit/(Loss) before tax ||(430.26) ||402.94 |
|Provision for Income Tax and Wealth Tax ||(142.23) ||129.96 |
|Net Profit/(Loss) after tax ||(288.03) ||272.98 |
|Add: Balance brought forward from previous Year ||1098.19 ||825.21 |
|Total amount available for appropriation ||810.16 ||1098.19 |
|Balance carried to Balance Sheet ||810.16 ||1098.19 |
2. REVIEW OF OPERATIONS
During the year Company achieved Gross Sales & Income from operations of '811.23 lakhs against the Turnover of ' 2311.15 lakhs in previous year. Since theCompany has yet to achieve its optimum scale of operations its net loss is '288.03 lakhs during the year against net profit of ' 272.98 lakhs in previous year.It is hope that Company would achieve greater heights in coming years.
No dividend has been recommended.
4. TRANSFER TO RESERVES
During the year no amount has been transferred in the reserve of the Company.
5. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis as stipulated under Regulation 34 of SEBI (ListingObligations & Disclosure Requirements) Regulations 2015 (SEBI Listing Regulations)forming part of this report has been given under separate section in the annual report.
6. CONSOLIDATED FINANCIAL STATEMENT
In accordance with the Companies Act 2013
("the Act) and Accounting Standard (AS) - 21 on Consolidated FinancialStatements read with AS - 23 on Accounting for Investments in Associates and AS - 27 onFinancial Reporting of Interests in Joint Ventures the audited consolidated financialstatement is provided in the annual report.
7. SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
Company has one subsidiary namely Hexa Securities and Finance Company Limited (HSFCL).HSFCL is Non-Banking Financial Company registered with Reserve Bank of India. A report onthe performance and financial position of HSFCL as per the Companies Act 2013 is providedas Form AOC-1 to the consolidated financial statement and hence not repeated here for thesake of brevity.
No Company has became/ceased to be the subsidiary associate and Joint Venture duringthe financial year 2016-17.
The policy for determining material subsidiaries as approved may be accessed on theCompany's website at the link: http://hexatradex.com/wp-content/uploads/2015/08/POLICY-FOR-DETERMI NING-MATERIAL-SUBSIDIARIES.pdf
8. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134 of the Companies Act 2013 with respectto Directors' Responsibility Statement it is hereby confirmed by the Board of Directors:-
a. that in the preparation of the annual accounts for the financial year ended 31stMarch 2017 the applicable accounting standards had been followed along with properexplanation relating to material departures;
b. that they had selected such accounting policies and applied them consistently andmade judgments and estimates that were 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 the year ended on that period.
c. that they had 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. that they had prepared the accounts for the financial year ended 31st March 2017 ona 'going concern' basis.
e. that they had laid down internal financial controls to be followed by the Companyand that such internalfinancialcontrols are adequate and are operating effectively; and
f. that they had devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.
9. DIRECTORS AND KEY MANAGERIAL PERSONNEL Shri Prithvi Raj Jindal (DIN: 00005301)Chairman and Non- executive Director and Ms. Sminu Jindal (DIN:00005317) ManagingDirector had resigned from the office of Directors w.e.f. 12.08.2016 due to theirpre-occupation.
The Board places on record its appreciation for the services rendered by Shri P. R.Jindal and Ms. Sminu Jindal during their association with the Company.
As per Section 134(3)(q) of the Companies Act 2013 read with rule 8(5) of Companies(Accounts) Rules 2014 detail of directors or Key Managerial Personnel who were appointedand
resigned during the year are given below:
Ms. Veni Anand (DIN: 07586927) was appointed as Non-Executive and Non-IndependentDirector of the Company under Section 149 of the Companies Act 2013 and SEBI ListingRegulations whose office shall be determine by rotation.
The Board of Directors elevated Shri Neeraj Kanagat from CFO to CEO & CFO of theCompany w.e.f. 12th August 2016.
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The Nomination and Remuneration Committee selects the candidate to be appointed as theDirectors on the basis of the needs and enhancing the competencies of the Board of theCompany.
The current policy is to have a balance of Executive Non-executive and IndependentDirectors to maintain the independence of the Board and separate its functions ofgovernance and management. The composition of Board of Directors during the year endedMarch 312017 are inconformity with Regulation 17 of the SEBI Listing Regulations readwith Section 149 of the Companies Act 2013.
The policy of the Company on directors' appointment including criteria for determiningqualifications positive attributes independence of a director and other matters asrequired under sub-section (3) of Section 178 of the Companies Act 2013 and theremuneration paid to the directors are governed by the Nomination and Remuneration Policyof the Company.
10. DECLARATION BY INDEPENDENT DIRECTORS The Company has received Declaration ofIndependence from all Independent Directors as stipulated under Section 149(7) of theCompanies Act 2013 and Regulation 17 of the SEBIListing Regulations confirming that theymeet the criteria of Independence.
11. BOARD EVALUATION
The Company has devised a Policy for performance evaluation of Independent DirectorsBoard Committees and other Directors which includes criteria for performance evaluationof non-executive directors and executive directors under Section 178(1) of the CompaniesAct 2013. This may be accessed at the link http://hexatradex.com/wp-content/uploads/2015/08/Performance-Evaluati on.pdf.
On the basis of the Policy for performance evaluation of Independent Directors BoardCommittees Chairman and other Directors a process of evaluation was followed by theBoard for its own performance and that of its Committees and individual Directors. Thedetails of same have been given in the report on corporate governance annexed hereto.
The details of programme for familiarisation of Independent Directors with the Companytheir roles rights responsibilities in the Company nature of the industry in which theCompany operates business model of the Company and related matters have been uploaded onthe website of the Company at the link http://hexatradex.com/wp-content/uploads/2015/08/Familiarization-Programme-of-Independen t-Directors.pdf.
12. CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of corporate governance andadhere to the corporate governance requirement set out by SEBI. The report on CorporateGovernance forms an integral part of this Report. The requisite certificate from theAuditors of the Company confirming compliance with the conditions of corporate governanceis attached to the report on Corporate Governance.
13. CONTRACTS AND ARRANGEMENT WITH RELATED PARTIES
All contracts / arrangements / transactions entered by the Company during the financialyear with related parties were in the ordinary course of business and on an arm's lengthbasis. During the year the Company had entered into material contract / arrangement /transaction with subsidiary of the Company.
The Policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed on the Company's website at thelink: http://hexatradex.com/wp-content/uploads/201 5/08/POLICY-ON-RELATED-PARTY-TRANSACTIONS.pdf
Your Directors draw attention of the members to Note 25 to the financial statementwhich sets out related party disclosures.
14. RISK MANAGEMENT
Your Company has identified following major risks to its business:
a) Competitive scenario: The business that the Company engaged in is highlycompetitive.
The Company faces competition from new entrants and from customers who are becomingmore involved in sourcing to satisfy their own supply requirements.
b) Global Risks: The Company proposes to
conduct wholesale trading operations which are international in nature. Theseinternational operations would involve additional risks including the possibility ofrestrictive actions by foreign governments changes in foreign laws limitations onrepatriation of earnings changes in currency exchange rates and political and economicinstability war and civil
disturbances or other risks that may limit or disrupt markets in which the Companyoperates.
c) Counterparty risks: Trading business
involves counterparty risks specially in high volatile time. Your company is havingeffective strategy and system to safeguard it against wide range of risks. The
Management conceives various elements and analysis the Risk involved and takeseffective steps to reduce the risk against the business of the Company. Further it alsotakes necessary steps to safeguard against irreparable loss to the Company against theunforeseen risk and adequate by covers assets of the Company during the course ofbusiness. The Management
system is reviewed periodically and
suitable changes are made depending upon the risk prevailing in the market.
15. INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operation was observed.
16. CORPORATE SOCIAL RESPONSIBILTY (CSR) The Corporate Social ResponsibilityCommittee (CSR Committee) formulated and recommended to the Board a Corporate SocialResponsibility Policy (CSR Policy) indicating the activities to be undertaken by theCompany which has been approved by the Board.
The CSR Policy may be accessed on the Company's website at the link: http://hexatradex.com/wp-content/uploads/2016/08/CSR-Policy-Tr adex.pdf. The key philosophy of all CSRinitiatives of the Company is driven by core value of inclusion.
The Company is committed to ensure that all development activities/initiativesundertaken in the field of education health care sanitation community welfare skilldevelopment employment generation infrastructure development promotion of nationalheritage and culture etc. are accessible to most marginalized segment of societies such aschildren women elderly and those with disabilities.
The Company would also undertake other initiatives in compliance with Schedule VII tothe Act.
The management is in the process to identifying the suitable projects where the CSRamount can be spent.
The Annual Report on CSR Activities is annexed herewith as Annexure 1.
17. AUDITORS & THEIR REPORT STATUTORY AUDITORS
M/s N. C. Aggarwal & Co. Chartered Accountants (Registration no. 003273N)Auditors of the Company retire at the ensuing annual general meeting and being eligibleoffer themselves for re-appointment.
Further as per the provisions of 139 of the Companies Act 2013 read with theCompanies (Audit and Auditors) Rules 2014 M/s N.C. Aggarwal & Co. have expressedtheir willingness to be appointed as Statutory Auditors of the Company. They have furtherconfirmed that the said appointment if made would be within the prescribed limits underSection 141 (3)(g) of the Companies Act 2013 and that they are not disqualified forappointment. Accordingly their appointment as Statutory Auditors of the Company for aterm of 4 years from the conclusion of the 6th Annual General Meeting until the conclusionof the 10th Annual General Meeting of the Company is placed for your approval.
Auditors' remarks in their report read with the notes to accounts referred to by themare selfexplanatory.
The Board has appointed Shri Awanish Kumar Dwivedi of M/s Awanish Dwivedi &Associates Company Secretaries to conduct Secretarial Audit of the Company for thefinancial year 2016-17. The Secretarial Audit Report for the financialyear ended 31stMarch 2017 is annexed herewith marked as Annexure - 2 to this Report. The SecretarialAudit Report does not contain any qualification reservation or adverse remark.
EXPLANATIONS OR COMMENTS BY THE BOARD ON EVERY QUALIFICATION RESERVATION OR ADVERSEREMARK OR DISCLAIMER MADE
i. Auditors' Report
There have been no fraud qualification reservation or adverse remark reported by theStatutory Auditors of the Company.
ii. Secretarial Auditor's Report
There are no qualification reservation or adverse remark reported by the SecretarialAuditors in their report.
MEETINGS OF THE BOARD
During the year under review the Board of Director of the Company met 4 (Four) timeson 30th May 2016 12th August 2016 4th November 2016 and 9th February 2017. Thecomposition of Board of Directors during the year ended March 31 2017 is in conformitywith Regulation 17 of the SEBI Listing Regulations read with Section 149 of the CompaniesAct 2013. For further details please refer report on Corporate Governance of this annualreport.
CORPORATE SOCIAL RESPONSIBILITY COMMITTEE (CSR COMMITTEE)
As on 31st March 2017 the CSR Committee comprised of Dr. Raj Kamal Agarwal(Chairman) Shri Girish Sharma and Ms. Veni Anand as other members. The Composition ofthe CSR Committee is in conformity with requirements of the Companies Act 2013. Duringthe year ended 31st March 2017 the Committee met 1 (once) on 31st March 2017.
As on 31st March 2017 the Audit Committee comprised of Dr. Raj Kamal Agarwal(Chairman) Shri Girish Sharma and Ms. Veni Anand as other members. The composition ofthe Audit Committee is in conformity with requirements as per the Section 177 of theCompanies Act 2013 and Regulation 18 of the SEBI Listing Regulations. During the yearended 31st March 2017the Committee met 4 (four) times on 30th May 2016 12th August2016 4th November 2016 and 9th February 2017. For further details please refer reporton Corporate Governance of this annual report.
The Vigil Mechanism of the Company which also incorporates a whistle blower policy interms of the SEBI Listing Regulations. Protected disclosures can be made by a whistleblower through an e-mail or a letter to the Compliance Officer or Managing Director or tothe Chairman of the Audit Committee.
The Policy on vigil mechanism and whistle blower policy may be accessed on theCompany's website at the link: http://hexatradex.com/wp-content/uploads/2015/08/POLICY-VIGIL-MECHA NISM.pdf
PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIES PROVIDED
Particulars of loans given investments made guarantees given and securities providedalong with the purpose for which the loan or guarantee or security is proposed to beutilized by the recipient are provided in the standalone financial statement (Please referto Note no. 08 10 & 13 to the standalone financial statement).
PARTICULARS REGARDING CONSERVATION OF ENERGY ETC.
As your Company is not engaged in any manufacturing activity the particulars relatingto conservation of energy and technology absorption as mentioned in the Companies(Accounts) Rules 2014 are not applicable to it. However emphasis is placed on employingtechniques that result in the conservation of energy. Details on the foreign exchangeearnings and expenditure of your Company appear in the Notes to Accounts.
EXTRACT OF ANNUAL RETURN
Extract of Annual Return of the Company is
annexed herewith as Annexure - 3 to this annual
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The employee's relations remained cordial throughout the period. There is no employees
whose particulars are required to be furnish under Section 197(12) of the Act read withRules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014.
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are provided in the Annual Report as Annexure-4.
19. PUBLIC DEPOSITS
The Company has not invited any public deposits during the year ended on 31st March2017.
20. ANY SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALSIMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
During the Financial Year there is no significant material orders passed by theregulators or courts or tribunals impacting the going concern status and company'soperations in future.
21. THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL)ACT 2013
The Company has adopted a policy for prevention of Sexual Harassment of Women atworkplace and has formed a Committee for implementation of said policy. No complaint ofharassment was received during the year.
Your Directors express their grateful appreciation to concerned Departments of Central/ State Governments Financial Institutions & Bankers Customers and Vendors for theircontinued assistance and co-operation. The Directors also wish to place on record theirdeep sense of appreciation for the committed services of the employees at all levels. Weare also grateful for the confidence and faith that you have reposed in the Company as itsmember.
| ||For and on behalf of the Board |
|Place: New Delhi Date: 3rd August 2017 ||Raj Kamal Agarwal Chairman |