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Indo Asia Finance Ltd.

BSE: 530747 Sector: Financials
NSE: N.A. ISIN Code: INE807A01010
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OPEN 4.04
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VOLUME 10796
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52-Week low 2.49
P/E
Mkt Cap.(Rs cr) 4
Buy Price 4.00
Buy Qty 204.00
Sell Price 0.00
Sell Qty 0.00
OPEN 4.04
CLOSE 3.85
VOLUME 10796
52-Week high 4.08
52-Week low 2.49
P/E
Mkt Cap.(Rs cr) 4
Buy Price 4.00
Buy Qty 204.00
Sell Price 0.00
Sell Qty 0.00

Indo Asia Finance Ltd. (INDOASIAFINANC) - Director Report

Company director report

To the Members

The Directors have great pleasure in presenting their 25th Annual Report along with theaudited financial statement for the financial year ended March 312015.

FINANCIAL RESULTS

The financial results of the Company for the year ended 31st March 2015 are summarisedbelow: ( The current financial year covers a period of six months from Oct 2014 to March2015 and the previous financial year covers a period of 18 months from Apr 2013 to Sep2014)

Particulars Current Fin. Year-ended 31stMarch2015 Previous Fin. Year ended 30th September 2014
(i) Revenue from operations (net) 4719468 33275007
(ii) Other Income 139834834 72248748
(iii) Total Income 144554302 105523755
(iv) Operating Expenditure 91046163 25866764
(v) Profit before Interest Depreciation and Amortisation and Tax 53508139 79656991
(vi) Finance Costs (net) 18496109 75553428
(vii) Depreciation and Amortisation 798173 2895571
(viii) Profit before Taxes 34213858 1207992
(ix) Tax Expenses 7303112 57646
(x) Net Profit for the Year 26910746 1150346
(xi) Balance Brought Forward from Previous Year NIL NIL
(xii) Amount Available for Appropriation 26910746 1150346

 

Appropriations
(a) Interim Dividends on Equity Shares NIL NIL
(b) Tax on Dividends NIL NIL
(c) Transfer to General Reserve NIL NIL
(d) Transfer to Special Reserve NIL 225550
(e) Balance carried to Balance Sheet 26910746 7274220

PERFORMANCE OF THE COMPANY

During the year your Company registered a total income of Rs. 144554302representing an increase of 36% over that of the previous year. This was mainly due to theprofit on sale of fixed assetsamounting to about Rs.13.95 Crores.Your Company registereda net profit of Rs. 26910746 as compared to previous year net profit of Rs. 1150346.The general depletion in the economic conditions was a major challenge for the NBFC’sfor collection and which in turn resulted in reduction in overall disbursements of loans.

DIVIDEND

In order to conserve the liquid resources for the development of business of theCompany and to enhance Shareholders’ value your Directors have not recommended anyDividend for the period ended 31.03.2015.

During the financial year ended 31.03.2015 an amount of Rs.1.94 Lakhs being unclaimeddividend pertaining to the financial year 20042005 and 2006 would become transferable toInvestors’ Education and Protection Fund (IEPF).

SHARE CAPITAL

During the year the Board of Directors of the Company at their meeting held on 1stDecember 2014 decided to go in for further issue of equity shares on preferential basisfor a value of Rs 6 crores for which the approval from members has been taken in AGM heldon 31.12.2014.

TRANSFER TO RESERVES

The Company retained the entire surplus in the Profit and Loss Account and hence notransfer to General Reserve was made during the Year.

DEPOSITS

The Company has not accepted Public Deposits during the period. The Company has repaidall earlier Deposits in June 2012.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SEC.186

These are covered by the notes on financial statements provided in this Annual Report.

DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL Appointments and Resignations

The Board has appointed Ms. Pooja Challani as Additional Director of the Company w.e.f05.08.2015 under the category of Woman Director. The Board of Directors seeks yoursupport in confirming the appointment of Ms. Pooja Challani as Woman Director of theCompany.

Details of appointments and resignations of Directors and Key Managerial personnelduring the year are tabled below:

Name of Director/Key Managerial Personnel Designation Date of Appointment Date of Resignation
Ms. Pooja Challani Woman Director Appointed as an Additional Director w.e.f. 05.08.2015. Not Applicable
Mr. S. Ravichandran Managing Director Appointed w.e.f. 10th November 2014 Resigned w.e.f.21st March 2015.

Re-appointments

As per provisions of the Companies Act 2013 Mr Lakshmi Narashma Rao the additionaldirector is liable to retire by rotation at the ensuing Annual General Meeting and beingeligible offers himself for re-appointment. The Board of Directors recommends hisre-appointment.

Declaration by Independent Directors

The Company has received declarations from all its Independent Directors that they meetthe criteria of independence as laid down under Section 149(6) of the Companies Act 2013and Clause 49 of the Listing Agreement in respect of the financial year ended March 312015.

BOARD MEETINGS HELD DURING THE FINANCIAL YEAR

During the period from October 1 2014 to March 31 2015 three Board Meetings wereconvened and held the details of which are given below. The intervening gap between theMeetings was within the period prescribed under the Companies Act 2013.

Date of Board Meeting Names of Directors who attended the meeting
13th November 2014 Padham J ChallaniN Subramanian M J Lakshmi Narashma Rao S Ravichandran
1st December 2014 Padham J Challani M J Lakshmi Narashma Rao S Ravichandran
11th February 2015 Padham J ChallaniN Subramanian M J Lakshmi Narashma Rao S Ravichandran

DETAILS OF COMMITTEES AND THEIR MEETINGS

The Board has the three primary committees namely Audit Committee Nomination andRemuneration Committee and Stakeholders’ Relationship Committee. The Composition ofthe primary Committees and their meeting dates are given below:

Name of the Committee Composition Details of Meetings held during the year Names of Directors who attended the meetings M/s.
Audit Committee Comprises of two Non-Executive Independent Directors. The Chairman of the Committee is an Independent Director. 3 meetings were held during the period on the following dates:- 13th Nov 2014 1st Dec 2014 and 11th feb 2015 N Subramaniam Lakshmi Narashma Rao
Nomination and Remuneration Committee Comprises of two Non-Executive Independent Directors. The Chairman of the Committee is an Independent Director 2Meetings were held during the period on the following dates:- 13thNov 2014 11th Feb 2015 N Subramaniam Lakshmi Narashma Rao Padam J Challani
Stakeholders' Relationship Committee Comprises of two Directors of whom two are Independent Directors and one is Executive Director. The Chairman of the Committee is an Independent Director. 2Meetings were held during the year on the following dates:- 13thNov 2014 11thFeb2015 N Subramaniam Lakshmi Narashma Rao Padam J Challani

COMPOSITION OF BOARD OF DIRECTORS

Name and Designation of the Director Categor y

Number of Board Meetings during the year ended 31.03.15

Whether attende d last AGM

Number of Directorships in other Companies

Number of Committee positions held in other Public Companies
Held Attended Yes / No Chairman Mem ber Chairman Mem ber
Padham J Challani CHAIRMAN Promoter Executive Director 3 3 Yes 13
N. Subramanian Non Executive & Independ ent Director 3 2 Yes 1
Lakshmi Narashma Rao Non Executive & Independ ent Director 3 3 Yes 1 1
Dr. S Ravichandran* Managing Director 3 3 yes 2
Pooja Challani** Woman Director

Details of recommendations of Audit Committee which were not accepted by the Boardalong with reasons

The Audit Committee generally makes certain recommendations to the Board of Directorsof the Company during their meetings held to consider financial results (Unaudited andAudited) and such other matters placed before the Audit Committee as per the CompaniesAct 2013 and Listing Agreement from time to time. During the year the Board of Directorshas considered all the recommendations made by the Audit Committee and has accepted andcarried out the recommendations suggested by the Committee to its satisfaction. Hencethere are no recommendations unaccepted by the Board of Directors of the Company duringthe year under review.

DETAILS OF POLICIES DEVELOPED BY THE COMPANY

(i) Nomination and Remuneration Policy

The Company has formulated the Nomination and Remuneration Policy in compliance withSection 178 of the Companies Act 2013 read along with the applicable rules thereto. Theobjective of this policy is to ensure

• The level and composition of remuneration is reasonable and sufficient toattract retain and motivate directors of the quality required to run the companysuccessfully;

• Relationship of remuneration to performance is clear and meets appropriateperformance benchmarks; and

• Remuneration to Directors Key Managerial Personnel and Senior Managementinvolves a balance with short and long-term performance objectives appropriate to theworking of the company and its goals

This policy is being governed by the Nomination and Remuneration Committee comprisingof three members of the Board all of whom are Non-Executive and Independent Directors.The policy lays down the standards to be followed by the Nomination and RemunerationCommittee with respect to the appointment remuneration and evaluation of Directors andKey Management Personnel.

Affirmation that the remuneration is as per the remuneration policy of the company

The Company has formulated the Nomination and Remuneration Policy in compliance withSection 178 of the Companies Act 2013 read along with the applicable rules thereto. Thispolicy governs the criteria for deciding the remuneration for Directors and Key ManagementPersonnel. It is affirmed that the remuneration to Directors and Key Management Personnelis being fixed based on the criteria and parameters mentioned in above mentioned policy ofthe Company.

(ii) Risk Management Policy

The Board of Directors of your Company has adopted a Risk Management Policy whichdetails the procedures to be followed by the Company with regard to risk management. TheBoardevaluates and reviews the risk factors associated with the operations of the Companyand recommends to the Board the methods to mitigate the risk and advise from time to timevarious measures to minimizing the risk and monitor the risk management for the Company.

(iv) Whistle-Blower Policy - Vigil Mechanism

The Company is committed to adhere to the highest standards of ethical moral and legalconduct of business operations. To maintain these standards the Company encourages itsemployees who have concerns about suspected misconduct to come forward and express theseconcerns without fear of punishment or unfair treatment. A Vigil (Whistle Blower)mechanism provides a channel to the Employees and Directors to report to the managementconcerns about unethical behavior actual or suspected fraud or violation of the Code ofConduct or Policy. The mechanism provides for adequate safeguards against victimization ofemployees and directors to avail of the mechanism and also provide for direct access tothe Chairman of the Board/Chairman of the Audit Committee in exceptional cases.

In line with the statutory requirements the Company has formulated a Whistle BlowerPolicy/Vigil Mechanism which covers malpractices and events which have taken place /suspected to have taken place misuse or abuse of authority fraud or suspected fraudviolation of company rules manipulations negligence causing danger to public health andsafety misappropriation of monies and other matters or activity on account of which theinterest of the Company is or is likely to be affected .

EVALUATION OF BOARD COMMITTEE AND DIRECTORS

Pursuant to the provisions of the Companies Act 2013 an annual performance evaluationof the performance of the Board the Directors individually as well as the evaluation ofthe working of the Board Committees was carried out based on the criteria and frameworkadopted by the Board.

The Independent Directors evaluation was done with main focus on their adherence to theCorporate Governance practices and their efficiency in monitoring the same. They are alsobeing evaluated on various parameters viz. active participation in strategic planningfiduciary responsibilities participation in Board and Committee meetings etc.

The performance evaluation of the Non Independent Directors was carried out by theentire Board of Directors (excluding the Director being evaluated) and they have expressedtheir satisfaction with the evaluation process which considered their commitment and theexercise of their responsibilities in the best interest of the Company.

NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES JOINT VENTURESOR ASSOCIATE COMPANIES DURING THE YEAR.

No such development has taken place during the year.

AUDITORS

Statutory Auditors

At the Annual General Meeting held on 31st December 2014 M/s. Krishnakumar &Associates Chartered Accountants were appointed as Statutory Auditors of the Company tohold office till the conclusion of the Annual General Meeting to be held in the calendaryear 2015.

In terms of Section 139 of the Companies Act 2013 the present Auditors havingcompleted Five years of continuous audit expressed their willingness not to bereappointed.A proposal has been received to appoint M/s. Krupa & Co. CharteredAccountants Chennai-600029as Statutory Auditors of the Company.This is placed forapproval of the shareholders.

Secretarial Auditor

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 is in theprocess of appointing a firm of Practising Company Secretaries to undertake theSecretarial Audit of the Company. The Secretarial Audit Report for the financial year2014-2015 would be available thereafter.

Response to qualifications in the Auditor’s Report

Statutory Audit Report

1. Under Report on other legal and regulatory requirements in para 2(f) the Auditorshave stated that the company has defaulted in transferring a sum of Rs 1.94 lakhs ofUnclaimed Dividend to Investors Education and protection Fund of the Govt.

Reply: Action has been taken and Demand Drafts for the said amount obtained and theprocess of uploading the details of Shareholders would be carried out.

2. Income Tax claims of Rs 3.04 Crores pertaining to assessment years from 2007-08 to2012-13 are under dispute and have not been deposited pending resolution of issue.

PARTICULARS OF EMPLOYEES AND REMUNERATION

Details as required under Section 197 of the Companies Act 2013 read with Rule 5(2) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are givenbelow:

(i) Details of the employees employed throughout the year and drawing remunerationwhich in the aggregate exceeds Rs. 60 Lakhs or more per annum during the financialyear.Nil

ii) None of the employees employed for a part of the financial year was in receipt ofremuneration for any part of that year which in the aggregate exceeds Rupees Five Lakhsper month during the financial year.

Details required as per Section 197 and Rule 5 of Companies

(Appointment and Remuneration of Managerial Personnel) Rules 2014

Name of Director/KMP Amount of Remuneration Per month Rs Ratio of remuneration to median remuneration of employees for the FY % increase in remunerat ion during the FY Comparison of remuneratio n to performance of company
Dr S Ravichandran 200000 16.67 Nil 3.50%

Percentage increase in the median remuneration of employees in the financial year Nil

Number of permanent employees on the rolls of the company as on 31.03.2015 = 21

Explanation on relationship between average increase in remuneration and companyperformance

No change in remuneration as the Company is in consolidation phase.

Variations in Market Capitalisation of the Company

The market capitalization of the Company as of 30th September 2014 was:-

Number of Shares as on 30th September 2014 Closing price as of 30th September 2014at BSE Market Capitalization in Crores
9000000 Rs. 7.69 6.92

The market capitalization of the Company as of 31March 2015 was:-

Number of Shares as on 31st March 2015 Closing price as of 31st March 2015 at BSE Market Capitalization in Crores
90.00.000 Rs 5.73 5.16

Price earnings ratio

Price earnings ratio As on 31.03.2015 As on 30.09.2014
2.99 0.13

Percentage increase or decrease in the market quotations of the shares of the companyin comparison to the ratewhen the company came out with the last public offer

NA

Key parameters for any variable component of remuneration availed by the directors;

No variable component availed.

The ratio of the remuneration of the highest paid director to that of the employees whoare not directors but receive remuneration in excess of the highest paid director duringthe year

NA

Details of pecuniary relationship or transactions of the non-executive directorsvis-a-vis the company

Non- Executive Directors get only Sitting Fees and conveyance for attending Board/Commitee Meetings.

ADEQUACY OF INTERNAL FINANCIAL CONTROLS

The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. To maintain its objectivity and independence the InternalAudit function reports to the Chairman of the Audit Committee of the Board and to theManaging Director. The Internal Audit Department monitors and evaluates the efficacy andadequacy of internal control system in the Company its compliance with operating systemsaccounting procedures and policies at all locations of the Company. Based on the report ofinternal audit function process owners undertake corrective action in their respectiveareas and thereby strengthen the controls. Significant audit observations andrecommendations along with corrective actions thereon are presented to the Audit Committeeof the Board.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALSIMPACTING THE GOING CONCERN STATUS AND COMPANY’S OPERATIONS IN FUTURE

During the year there are no significant and Material orders passed by the Regulatorsor Courts or Tribunals impacting the going concern status and Company’s operations infuture

MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY WHICH HAS OCCURRED SINCE 31.03.2015 TILL THE DATE OF THIS REPORT

There are no material Changes and commitments affecting the financial position of thecompany which has occurred since 31.03.2015 till the date of this report

EXTRACT OF ANNUAL RETURN

An extract of the Annual Return in form MGT-9 is annexed herewith

RELATED PARTY TRANSACTIONS

There were no related party transactions entered into during the financial year by thecompany with its Promoters Key Managerial Personnel or other designated persons which mayhave potential conflict with interest of the company at large other than the remunerationpaid to the Executive Directors and Dividend received by them from the Company inproportion to the shares held by them.

The details of Related Party Transactions are provided in the Notes to the Accounts.

CORPORATE GOVERNANCE REPORT

Some Corporate governance requirements as stipulated under the listing agreement withthe stock exchanges is not applicable to company as the share capital of the company isless than Rs. 10 Crores and the networth of the company is less than Rs. 25 Crores. -

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO

NA

DIRECTORS’ RESPONSIBILITY STATEMENT

In terms of Section 134 (5) of the Companies Act 2013 the directors would like tostate that:

i. In the preparation of the annual accounts the applicable accounting standards havebeen followed.

ii. The directors have selected such accounting policies and applied them consistentlyand made 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 or loss of the Company for the year under review.

iii. The directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities.

iv. The directors have prepared the annual accounts on a going concern basis.

v. The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.

vi. The directors had devised proper system to ensure compliance with the provisions ofall applicable laws and is working the system smoothly.

DEPOSITORY SYSTEM

As the members are aware your Company’s shares are tradable in electronic formand the Company has established connectivity with both the Depositories i.e. NationalSecurities Depository Limited (NSDL) and Central Depository Services (India) Limited(CDSL). In view of the advantages of the Depository System the members are requested toavail of the facility of dematerialisation of the Company’s shares.

INDUSTRIAL RELATIONS

Industrial relations in all the units and branches of your Company remained cordial andpeaceful throughout the year.

ACKNOWLEDGEMENTS

The Directors wish to convey their appreciation to business associates for theirsupport and contribution during the year. The Directors would also like to thank theemployees members customers bankers and associates for the continued support given bythem to the Company and their confidence reposed in the management.

By Order of the Board
For Indo Asia Finance Limited
Padham J Challani
Chairman
September 12015
Registered Office
No.15 New Giri Road
T.Nagar Chennai-600017

Annexure (C)to Board's Report

Form AOC-2

(Pursuant to Section 134(3)(h) of the Companies Act 2013 read with Rule 8(2) of theCompanies Accounts) Rules 2014

Form for disclosure of particulars of contracts/arrangements entered into by theCompany with relate d parties referred to in Section 188(1) of the Companies Act 2013including certain arms' length transactions under third proviso thereto.

1.Details of contracts/arrangements or transactions not at arm's length basis

(a) Name(s) of related party and nature of relationship
(b) Nature of contracts/arrangements/transactions
(c) Duration of the contracts/arrangements/transactio ns
(d) Salient terms of the contracts or arrangements or transactions including the value if any
(e) Justification for entering into such contracts or arrangements or transactions NA
(f) Date(s) of approval by the Board
(g) Amount paid as advances if any
(h) Date on which the special resolution was passed
(i) Amount paid as advances if any
(j) Date on which (a) the special resolution was passed in general meeting as required under first proviso to Section 188 of the Companies Act 2013

2.Details of contracts/arrangements or transactions at arm's length basis

(a) Name(s) of related party and nature of relationship
(b) Nature of contracts/arrangements/transactions
(c) Duration of the contracts/arrangements/transactions
(d) Salient terms of the contracts or arrangements or transactions including the value if any NIL
(e) Date(s) of approval by the Board if any
(f) Amount paid as advances if any