Indo Thai Securities Ltd.
|BSE: 533676||Sector: Financials|
|NSE: INDOTHAI||ISIN Code: INE337M01013|
|BSE LIVE 11:07 | 20 Sep||52.50||
|NSE 11:02 | 20 Sep||52.75||
|Mkt Cap.(Rs cr)||53|
|Mkt Cap.(Rs cr)||52.50|
Indo Thai Securities Ltd. (INDOTHAI) - Director Report
Company director report
Your directors have pleasure in presenting the 22nd Annual Report of INDO THAISECURITIES LIMITED along with the Audited Financial Statements for the year endedMarch 31 2016.
Your Company has been offering services to corporate clients high net worthindividuals and retail investors since 1995. Company is rendering broking and clearingservices in the Capital & Derivatives Segments being a Member of National StockExchange of India Limited ('NSE') BSE Limited ('BSE') and Metropolitan Stock Exchange ofIndia Limited ('MSEI') and Depository Participants of Central Depository Services (India)Limited ('CDSL'). Considering with our diversified base of customer and highly talentedworkforce we are emerging as growing company in the field of security market. Indo ThaiSecurities Limited is a flagship company of 'Indo Thai' group which has its RegisteredOffice in Indore.
The financial performance of the Company for the financial year ended March 312016 issummarized below:
PERFORMANCE REVIEW AND STATE OF COMPANY'S AFFAIRS
One more year of your Company's operation has been successfully accomplished withprofits. The financial performance of your Company during the financial year ended March31 2016 remained healthy. Increased operational income led to high revenue growth. TheNet-worth of your Company as on March 31 2016 was Rs. 431546708/- as against Rs.378176470/-in previous year.
Standalone Performance R Revenue: The operating revenue (including sales ofshares) was remarkable at Rs. 3862.56 Lakhs as against Rs. 3199.44 Lakhs in previous yearended on March 312015.
Profit Before Tax: On a standalone basis your Company earned a higherProfit Before Tax ('PBT') of Rs. 652.21 Lakhs as against Rs.274.73 Lakhs in previous year.
Profit After Tax: Company has reported a Profit After Tax ('PAT') of Rs.654.06 Lakhs as against Rs. 241.22 Lakhs in previous year.
Earning Per Share: Due to higher earnings and after full yearappropriation the Earning Per Share ('EPS') was at Rs. 6.54 for the financial year2015-16 as against Rs. 2.41 in the previous year.
Revenue: During the financial year under review on a consolidated basisthe Operating Revenue was higher at Rs. 3862.56 Lakhs as against Rs. 3199.44 Lakhs ofprevious year (an increase of approx 20%).
Profit Before Tax: On a consolidated basis your Company earned a higherProfit Before Tax ('PBT') of Rs. 630.58 Lakhs as against previous year Rs. 360.41 Lakhs.
Profit After Tax: The consolidated profit after tax (PAT) has been jumpedto Rs. 631.37
Lakhs and is remarkable as compared to previous year which stood at Rs.296.10 Lakhs. +Earning Per Share: During the financial year 2015-2016 due to huge earnings and afterfull year appropriations the earning per share was Rs. 6.31 as against Rs. 2.96 in theprevious financial year.
There always exist a need for continuous efforts to bring about transformation andimprovement in the working and functioning of the affairs of the Company so that itbecomes fair transparent competitive and attractive for stakeholders.
We are more inclined towards offering meticulous trading experiences to our clientswhether you are a bull or a bear trade anywhere with the most powerful trading platformin the palm of your hand through our Mobile Application "Indo Thai- QuickTrade".
For diversify the working affairs of the Company and for enhancing its financialperformance in the future and also keeping the growth prospects of the company and itsshareholders your Company is concentrating on working into a new segment i.e. marketingof Mutual Fund products.
Your company continues to work towards the maximization of overall return not only byproviding better returns but also by further analyzing and exploring opportunities withinthe untouched sources and channeling the savings into investments with more focus onMutual Funds. The Mutual Fund Market in previous years has seen various prospects but onlyaround 10 million people are investing in India. We aim to educate our investors regardingmutual fund as it provides long term prospects to the investors to improve returns.
There has been a merger of FMC with SEBI on September 28 2015 on account of thatMerger it may be possible that SEBI will allow Stock Brokers to start Commodity Brokingand as a result of this merger. Your company may subject to regulatory approvalsofficially trade in the commodity markets also in near future.
We also hope that because of 7th Pay Scale introduced by Government of India Peoplewill receive more income in their hands and they will channelize their savings towardsMutual Fund Business which will help Company's business significantly.
The Board of Directors in their meeting held on May 10 2016 has recommended a finaldividend @ 10% i.e. Re. 1/- per Equity Share of face value of Rs. 10/- each for thefinancial year ended March 31 2016 aggregating to Rs. 1 Crore (excluding dividenddistribution tax). The dividend payout is subject to approval of members at the ensuingAnnual General Meeting ('AGM').
TRANSFER TO UNPAID DIVIDEND ACCOUNT
Total 3055 Members were eligible to get Dividend as declared at previous Annual GeneralMeeting held on September 28 2015 for the Financial Year ended on March 31 2015. Payoutswere given successfully through National Electronic Clearing Services ('NECS') to 2507Members and for rest 548 Members Demand Drafts were issued. 314 Demand Drafts out of 548Demand Drafts has not been encashed by the Members thus transferred to unpaid dividendAccount. The unpaid dividend amount for Financial Year ended on March 31 2016 under theaccount M/S INDO THAI SECURITIES LIMITED UNPAID DIVIDEND PAYABLE ACCOUNT was Rs. 90985.
Since Company has first time declared Dividend for the financial year ended on March31 2015; therefore there was no unclaimed Dividend amount required to be transferred tothe Investor Education and Protection Fund during the year 2015-16 as required under theInvestor Education and Protection Fund (Awareness and Protection of Investor) Rules 2001.
TRANSFER TO RESERVES
During the year under review no amount was transferred to General Reserve and profitavailable after assets write-off and provision for dividend and Dividend Distribution Taxhas been carried forward to the Profit & Loss Statement.
CASH FLOW STATEMENT
As required under Regulation 34(2) and Regulation 53(b) of Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015 withthe Stock Exchanges a Cash Flow Statement is attached to the Balance Sheet along withAuditors Report.
SHIFTING OF REGISTERED OFFICE
The Registered Office of the Company has been shifted from '16 4th Floor Dawa BazarR.N.T. Marg Indore-452001 M.P. to 'Capital Tower 2nd Floor Plot Nos. 169A-171 PU-4Scheme No.-54 Indore-452010 M.P. w.e.f. 07.11.2015.
The building "Capital Tower" where new registered office is located isequipped with latest infrastructure facilities such as Canteen Well Equipped GymSpacious Parking Facility etc.
SUBSIDIARY/IES AND ASSOCIATE/S
Your Company has one Wholly Owned Subsidiary Company i.e. Indo Thai Realties Limitedand one Associate Company i.e. Indo Thai Commodities Private Limited.
During the Financial Year 2015-16 no Company has become/ceased to be Subsidiary orAssociate of your Company.
The Financial Statements of the Subsidiary and Associate Company (prepared inaccordance with Accounting Standard 21 issued by the Institute of Chartered Accountants ofIndia) form part of the Annual Report and are reflected in the Consolidated FinancialStatements of the Company.
A separate segment containing the salient features of financial statements of asubsidiary and associate company of your company forms part of consolidated financialstatements in compliance with Section 129(3) and other applicable provisions if any ofthe Companies Act 2013 which have been furnished under Note No. 35 to the ConsolidatedFinancial Statements and forms part of this Annual Report.
The financial statements of the subsidiary and associate Company and relatedinformation are available for inspection by the Members at the Registered Office of yourCompany during business hours on all days except Saturdays and Sundays upto the date ofthe Annual General Meeting as required under Section 136 of the Companies Act 2013. Anymember desirous of obtaining a copy of the said financial statements may write to theCompany Secretary at the Registered Office of your Company. The financial statementsincluding the consolidated financial statements financial statements of subsidiary andassociate company and all other documents required to be attached to this report have beenuploaded on the website of your Company www.indothai.co.in.
Indo Thai Realties Limited was incorporated on 01.03.2013 as Wholly Owned Subsidiary ofIndo Thai Securities Limited and Indo Thai Securities Limited has invested Rs.79787000/- (Rupees Seven Crores Ninety Seven Lakhs Eighty Seven Thousand only) assubscription to the Memorandum of Association. Mr. Parasmal Doshi Mr. Om Prakash GaubaMr. Mayur Rajendrabhai Parikh and Mr. Saurabh Oswal are holding office as Directors ofCompany and Ms. Mayuri Jain is tendering her services as Company Secretary of Indo ThaiRealties Limited.
Indo Thai Commodities Private Limited is the Associate Company of Indo Thai SecuritiesLimi ted. Such associate company was incorporated on 21.11.2003. Indo Thai SecuritiesLimited has holding of 40.05% Equity Shareholding in such associate company by investingRs. 4252000/- (Rupees Forty Two Lakhs Fifty Two Thousand only). Mr. Parasmal Doshi andMr. Dhanpal Doshi are holding office as Directors of Company.
The financial performance of Subsidiary Company & Associate Company included in theconsolidated financial statements of your Company and is also set out in the prescribedformat 'Form No. AOC-1' is appended as "Annexure-A" to this Board'sReport.
DIRECTORS & KEY MANAGERIAL PERSONNEL
In compliance with the provisions of Sections 149 152 read with Schedule IV and allother applicable provisions of the Companies Act 2013 and the Companies (Appointment andQualification of Directors) Rules 2014 (including any statutory modification(s) orre-enactment thereof for the time being in force) and Regulation 17(1) of the Securitiesand Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 Shri Om Prakash Gauba Shri Sunil Kumar Soni Shri Sukrati Ranjan Solanki Smt.Shobha Santosh Choudhary were appointed as the Non-executive Independent Directors of theCompany at the 20th AGM of the company held on September 20 2014 to hold office for aterm of 5 (Five) consecutive years from the date of 20th Annual General Meeting.
Further Mr. Dhanpal Doshi Mr. Parasmal Doshi and Mr. Rajendra Bandi were re-appointedas Managing Director cum Chief Executive Officer Whole-time Director cum Chief FinancialOfficer and Whole-time Director of the Company respectively for a term of 3 (three)consecutive years from date of 20th Annual General Meeting out of them Mr. Parasmal Doshiand Mr. Rajendra Bandi are liable to retire by rotation.
Mr. Deepak Sharma was appointed as Chief Financial Officer w.e.f. 09.05.2014 as definedunder Section 2(19) and falls under Section 2(51) as "Key Managerial Personnel"of the Company. Mr. Anurag Kumar Saxena was appointed and tendering his services since16.11.2009 as Company Secretary cum Compliance Officer of the Company.
CHANGES IN DIRECTORS & KEY MANAGERIAL PERSONNEL
There have been no changes in the Board of Directors & Key Managerial Personnel ofthe Company during the year under review.
RETIREMENT BY ROTATION
In accordance with the provisions of Section 152 of the Companies Act 2013 and interms of the Articles of Association of the Company the Executive Director Mr. RajendraBandi (Wholetime Director) (DIN: 00051441) is liable to retire by rotation at the ensuingAnnual General Meeting and being eligible seek re-appointment at the ensuing AnnualGeneral Meeting. Your Board of Directors recommends their re-appointment. Mr. RajendraBandi is not disqualified under Section 164(2) of the Companies Act 2013.
Brief resume of the Director proposed to be appointed/reappointed nature of hisexperience in specific functions and area and number of companies in which he holdmembership/chairmanship of Board and Committees Shareholdings and inter-se relationshipswith other directors as stipulated under Regulation 36(3) of Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015 of ListingAgreement are provided in the 'Annexure to Notice of AGM' forming part of the AnnualReport.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
Independent Directors are familiarized with their roles rights and responsibilities inthe Company as well as with the nature of industry and business. The details ofFamiliarization Programme arranged for Independent Directors have been disclosed on thewebsite of the company and are available at the following link:http://www.indothai.co.in/Admin/Investors/Shar eho l ders/Fam iliarization%20Program%20for%2 0 I D s ITSL.pdf and http://indothai.co.in/Admin/Investors/Shareholders/Details%20of%20Familiarization%20Progra mmes.pdf
DECLARATION BY THE INDEPENDENT DIRECTORS
The Company has received necessary declaration from each Independent Directors underSection 149(7) of the Companies Act 2013 that he/she meets the criteria of theindependence laid down in Section 149(6) of the Companies Act 2013 and Regulation 25 ofthe Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015.
CODE OF CONDUCT FOR INDEPENDENT DIRECTORS The Company has also placed theCode of Conduct for Independent Directors this Code is a guide to professional conductfor Independent Directors. Adherence to these standards by Independent Directors andfulfillment of their responsibilities in a professional and faithful manner will promoteconfidence of the investment community particularly minority shareholders regulators andcompanies in the institution of Independent Directors.
Nomination and Remuneration Committee of the Board had prepared and sent through itsChairman draft parameterized feedback forms for evaluation of Board IndependentDirectors and Chairman.
Independent Directors in their meeting held on 03rd March 2016 transacted all thebusiness cited under Regulation 25(4) of Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 and Clause VII(3) of theSchedule IV of the Companies Act 2013 which includes Board's Performance performance ofChairman and other Nonindependent Directors.
The Board subsequently evaluated performance of its Own Committees and IndependentDirectors without participation of the relevant director.
DIRECTORS' RESPONSIBILITY STATEMENT
To the best of knowledge and belief and according to the information and explanationsobtained by them your directors make the following statement in term of Section 134(3)(c)of the Companies Act 2013 that:
in the preparation of the Annual Accounts for the year ended March 31 2016 theapplicable accounting standards have been followed and there are no material departuresfor the same; 0 the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as on March 31 2016 andof the profits of the Company for the year ended on that date;
the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
the Directors have prepared the annual accounts on a going concern basis;
the Directors have laid down internal financial control to be followed by theCompany and that such internal financial controls are adequate and operating effectively;and 0 the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such system were adequate and operating effectively.
NUMBER OF MEETINGS OF THE BOARD
During the financial year 2015-16 4 (Four) Meetings of the Board were held on14.05.2015 25.07.2015 07.11.2015 and 06.02.2016; and details of such meetings areprovided in the Corporate Governance Report which forms part of this report. The maximuminterval between any two meetings did not exceed 120 days as prescribed in the CompaniesAct 2013.
AUDITORS & AUDITOR'S REPORT
The auditors M/s. S. Ramanand Aiyar & Company Chartered Accountants Indore theStatutory Auditors will retire at the ensuing Annual General Meeting having regard to theprovisions of Section 139(2) of the Companies Act 2013. Your Board wish to place onrecord the excellent professional services received from them all along.
The Board has proposed the appointment of M/s SPARK & Associates CharteredAccountants Indore as Statutory Auditors as recommended by the Audit Committee. Membersare requested to consider their appointment. The appointment of the auditors is proposedto the Members in the Notice of the ensuing Annual General Meeting vide item no. 4 for aperiod of five years commencing from the conclusion of ensuing 22nd Annual General Meetingtill the conclusion of the 27th Annual General Meeting subject to ratification by theMembers every year. The Company has received a confirmation from the Statutory Auditors tothe effect that their appointment if made would be within limits prescribed underSection 141 of the Companies Act 2013.
The notes on Financial Statements referred to in the Auditors' Report are selfexplanatory and therefore do not call for any further comments. There are noqualifications reservations and adverse remarks are contained in the Auditors Report.
Pursuant to the Provisions of Section 204 of Companies Act 2013 and rules madethereunder the Board has appointed M/s Kaushal Ameta & Co. Company Secretaries inPractice (holding Certificate of Practice bearing No 9103) to undertake the SecretarialAudit for the financial year 2015-16. The Secretarial Audit Report for the financial yearended March 31 2016 is annexed herewith marked as "Annexure-B" in 'FormNo. MR-3' and forms an integral part of this Report. No qualifications reservations andadverse remarks were contained in the Secretarial Audit Report.
Your Company has not accepted any deposits from the public falling within the purviewof Section 73 and 74 of the Companies Act 2013 read together with the Companies(Acceptance of Deposit) Rules 2014 therefore there was no principal or interestoutstanding as on the date of the balance sheet.
CODE OF CONDUCT
In compliance with the Regulation 26(3) of Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 and the CompaniesAct 2013 the Company has framed and adopted a Code of Conduct ('the code'). The Code isapplicable to the members of the Board the Senior Management Officers and Employees ofthe Company. The Code is available on the following link : http://indothai.co.in/Code ofConducts for Man agement and Employees.pdf All the Members of the Board the SeniorManagement Officers and Employees have affirmed compliance to the Code as on March 312016. A declaration to this effect signed by Managing Director cum CEO forms part of theAnnual Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the year 2015-16 as stipulated underRegulation 34(2)(e) of Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 with the Stock Exchanges in India is presentedin a separate section forming part of this Annual Report and gives detail of overallindustry structure developments performance and state of affairs of the Company'soperations during the year.
INTERNAL CONTROL SYSTEMS AND COMPLIANCE FRAMEWORK
Your Company has put in place adequate internal financial controls with reference tothe financial statements some of which are outlined below: Your Company has adoptedaccounting policies which are in line with the Accounting Standards prescribed in theCompanies (Accounting Standards) Rules 2006 that continue to apply under Section 133 andother applicable provisions if any of the Companies Act 2013 read with Rule 7 of theCompanies (Accounts) Rules 2014 and relevant provisions of the Companies Act 1956 tothe extent applicable.
A system of strict internal control including suitable monitoring procedures hasalways believed that transparency systems and controls are important factors in thesuccess and growth of any organization.
The Company has an adequate system of internal control supported by an extensiveprogramme of internal control; and systems are established to ensure that financial andother records are reliable for preparing financial statements. Internal Audit Reports andsignificant Audit observations are brought to the attention of the Audit Committee of theDirectors. The internal controls existing in the Company are considered to be adequatevis-a-vis the business requirements.
Your Company ensures adequacy with its current size and business to ensure operationalefficiency protection and conservation of resources accuracy and promptness in financialreporting and compliance of l aws and regulations. It is supported by the internal auditprocess and will be enlarged to be adequate with the growth in the business activity.
Internal Audit for the financial year 2015-16 was conducted by M/s SPARK &Associates Chartered Accountants Indore. Further the Company has appointed M/s BDMV& Co. Chartered Accountants Indore in the Board Meeting held on May 10 2016 forconducting the Internal Audit of the Company for the financial year 2016-17. The ideabehind conducting internal audit is to examine that the company is carrying out itsoperations effectively and performing the processes procedures and functions as per theprescribed norms. The Internal Auditors reviews the adequacy and efficiency of the keyinternal controls guided by the Audit Committee.
The Company has appointed M/s BDMV & Co. Chartered Accountants Indore inaccordance with the circulars issued by SEBI for conducting an Internal Audit of StockBroking and Depository Participant Operations Regulatory Compliance Audit and SystemsAudit. The purpose of this Internal Audit is to examine that the processes and proceduresfollowed and the operations carried out by the Company meet with the requirementsprescribed by SEBI and Stock Exchange(s) for Depository Participant/TradingMembers/Clearing Members.
APPOINTMENT OF M/s BIGSHARE SERVICES PRIVATE LIMITED AS THE REGISTRAR &TRANSFER AGENT OF YOUR COMPANY
Pursuant to Securities and Exchange Board of India ("SEBI") Order no.WTM/RKA/MIRSD2/41/2016 dated March 22 2016 against M/s Sharepro Services (India) PrivateLimited SEBI has directed to all client companies of M/s Sharepro Services (India)Private Limited to switchover activities related to a Registrar and Share Transfer Agentto another Share Transfer Agent registered with SEBI.
In this connection Company has decided to appoint M/s Bigshare Services PrivateLimited in place of M/s Sharepro Services (India) Private Limited And the Board ofDirectors of your Company at their meeting held on May 10 2016 approved the appointmentof M/s Bigshare Services Limited as the Registrar & Transfer Agent of the Company witheffect from 1st August 2016 or any convenient date for M/s Bigshare Services PrivateLimited M/s Sharepro Services (India) Private Limited and Company. Further throughaforesaid SEBI Interim Order dated March 22 2016 issued against M/s Sharepro Services(India) Private Limited and some of its employees among other things all clientcompanies of M/s Sharepro Services (India) Private Limited are required to conduct athorough audit of the records and systems of M/s Sharepro Services (India) PrivateLimited concerning dividend payments and transfer of securities to determine whetherdividends have been paid to actual/beneficial holders and whether securities have beentransferred as per the provisions of law.
Accordingly your Company has appointed M/s Manish Tamboli & Associates PracticingCompany Secretaries Indore for conducting such audit and the unqualified Audit Reportdated 25.07.2016 has been duly submitted to the Stock Exchanges i.e. BSE & NSE and tothe Securities Exchange Board of India
Your Company recognizes that risk is an integral part of business and is committed tomanaging the risks in a proactive and efficient manner. Your Company periodically assessesrisks in the internal and external environment along with the cost of treating risks andincorporates risk treatment plans in its strategy business and operational plans.
The Company's operations are prone to general risks associated with economicconditions change in Government regulations tax regimes other statutes financial risksand capital market fluctuations.
Your Company has taken Brokers Indemnity Insurance Policy for Exchange(s) in order tocover the risk arising from operations. Additionally the assets of the Company have alsobeen insured under different kinds of separate policies i.e. Standard Fire and SpecialPerils Policy Burglary B.P. Electronic Equipment Insurance Vehicle Insurance Policy.Company had also taken Key Man Insurance Policy(ies) in order to avoid large negativeimpact on the Company's operations due to sudden loss of Keyman of the Company.
The Company has in place a Risk Management Policy which was reviewed by the AuditCommittee and approved by the Board of Directors of the Company and the risk appetite foryour Company under adherence of Section 134 of the Companies Act 2013 and rules madethereunder. The Policy provides for a robust risk management framework to identify andassess risks such as operational strategic financial and other risks and put in place anadequate risk management infrastructure capabl e of addressing these risks. Directors haveconstituted a Risk Management Committee to oversee the risk management efforts in theCompany under the Chairmanship of Mr. Parasmal Doshi. The details of Committee and itscharter are set out in Corporate Governance Report forming part of this Annual Report.Further there are no such risk which in the opinion of the Board threaten the existenceof your Company. However some of the risks which may pose challenges are set out in theManagement Discussion and Analysis report which forms part of this Annual Report.
LISTING & DEPOSITORY FEE
The Securities and Exchange Board of India (SEBI) vide their notification datedSeptember 02 2015 issued SEBI (Listing Obligations and Disclosures Requirements)Regulations 2015 with the aim to consolidate and streamline the provisions of ListingAgreement for different segments of Capital Markets to ensure better enforceability. Thesaid regulations were effective from December 01 2015. Accordingly all listed entitieswere required to enter into the fresh Listing Agreement within six months from theeffective date. The Company entered into Listing Agreement with BSE Limited and NationalStock Exchange of India Limited in the month of January 2016.
The Company has paid Annual Listing Fee for the Financial Year 2016-17 to the BSE Ltd.and the National Stock Exchange of India Ltd according to the prescribed norms ®ulations.
Company has also paid Annual Custody Fee to National Securities Depository Limited andIssuer Fee to Central Depository Services (India) Limited for the financial year 2016-17.
EXTRACT OF ANNUAL RETURN
The details forming part of extract of Annual Return in 'Form No. MGT-9' as requiredunder Section 92(3) of the Companies Act 2013 read wi th the Compani es (Management andAdministration) Rules 2014 is included in this Board's Report as "Annexure-D"and forms an integral part of this report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The details of loans guarantees and investments covered under the provisions ofSection 186 of the Companies Act 2013 and rules made thereunder are shown under Note No.11&36 in the notes to the financial statements.
RELATED PARTY TRANSACTIONS
There were no materially significant related party transactions i.e. transactions ofmaterial nature with its promoters directors or senior management or their relativesetc. that may have potential conflict with the interest of company at large. Transactionsentered with related parties as defined under the Companies Act 2013 and provisions ofSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 during the financial year 2015-16 were mainly in the ordinary course ofbusiness and on an arm's length basis.
Prior approval of the Audit Committee is obtained by the Company before entering intoany related party transaction as per the applicable provisions of Companies Act 2013 andSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015. As per the provisions of Section 188 of the Companies Act 2013approval of the Board of Directors is also obtained for entering into related partytransactions by the Company. A quarterly update is also given to the Audit committee andthe Board of Directors on the Related Party Transactions undertaken by the Company fortheir review and consideration. During the year your Company has not entered into anymaterial contract arrangement or transaction with related parties as defined underSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 and Related Party Transaction Policy of the Company. The details withrespect to the related party transactions are mentioned in the notes to the audited(standalone) financial statements.
The policy on materiality of Related Party Transactions and dealing with related partytransaction as approved by the Board is available on the Company's website and can beaccessedat : http://www.indothai.co.in/Admin/Investors/Shareholders/Policv%20on%20Related%20Partv%20 Transactions 09.08.2014.pdf There are notransactions that are required to be reported in Form No. AOC-2 and such AOC-2 forms partof this report as "Annexure-C"
CORPORATE SOCIAL RESPONSIBILITY (CSR) & CSR INITIATIVES
Pursuant to the provisions of Section 135 of the Companies Act 2013 the Company hadconstituted the Corporate Social Responsibility Committee under the Chairmanship of Mr.Parasmal Doshi Whole-time Director cum Chief Financial Officer of the Company in order toconduct and review Corporate Social Responsibility activities. The composition of CSRCommittee has been stated under Corporate Governance Report. The details relating toformation of 'Corporate Social Responsibility Policy' and its content has been disclosedin "Annexure-E" and set out to be part of Board's Report. The CorporateSocial Responsibility Policy may be accessed on the Company's Website at the link.
VIGIL MECHANISM POLICY / WHISTLE BLOWER POLICY
The Board had adopted Vigil Mechanism Policy pursuant to the provisions of Section177(9) of the Companies Act 2013 and The Companies (Meetings of Board and Its Powers)Rules 2014 and Regulation 22 of Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015. The policy provides for aframework and process whereby concerns can be raised by its Employees and Directors to themanagement about unethical behavior actual or suspected fraud or violation of the Code ofconduct or legal or regulatory requirements incorrect or misrepresentation of anyfinancial statements and reports etc. More details on the Vigil Mechanism and WhistleBlower Policy of your Company have been outlined in Corporate Governance Report whichforms part of this annual report.
The Vigil Mechanism Policy may be accessed on the Company's web site at thehttp://indothai.co.in/Admin/Investors/Sharehold ers/Vigil%20Mechanism%20Policy10.11.2014.pdf
NOMINATION AND REMUNERATION POLICY
Pursuant to the provisions of Section 178 of the Companies Act 2013 and in complianceof Regulation 19(4) of Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 the Company had formed Nomination andRemuneration Policy for Directors Key Managerial Personnel and Employees of the companyin order to pay equitable remuneration to Directors KMP's and other Employees of theCompany. The composition of Nomination and Remuneration Committee has been given underCorporate Governance Report forming part of this Annual Report and 'Policy on Remunerationof Directors Key Managerial Personnel And Other Employees' has been stated in "Annexure-F"set out to be part of Board's Report.
The policy may be accessed on the company's website at the link:http://indothai.co.in/Admin/Investors/Sharehold ers/Policy%20on%20Remuneration%20of%20Directors.%20KMPs%20and%20other%20Emplovee s 09.05.2014.pdf
POLICY ON PRESERVATION OF DOCUMENTS AND RECORDS
During the year under review your Company has adopted the Policy on Preservation ofDocuments and Records in accordance with Regulation 9 of Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015. The Policyensures that the Company complies with the applicable document retention lawspreservation of various statutory documents and also lays down minimum retention periodfor the documents and records in respect of which no retention period has been specifiedby any law/ rule/ regulation. The Policy also provides for the authority under which thedisposal /destruction of documents and records after their minimum retention period can becarried out.
The said policy is available on the website of the Company at the URLhttp://indothai.co.in/Admin/Investors/Sharehold ers/Policv%20for%20Preservation%20of%20Documents.pdf
POLICY ON DISCLOSURE OF MATERIAL EVENTS AND INFORMATION
During the year under review your Company has adopted the Policy on Determination ofMateriality in accordance with Regulation 30 of Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 to determine theevents and information which are material in nature and are required to be disclosed tothe Stock Exchanges. The said policy is available on the website of the Company at the URLhttp://indothai.co.in/Admin/Investors/Sharehold ers/Pol i cy%20for%20Determ ination%20of%20M ateriality 07112015.pdf
In accordance with the requirements of Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 the Company has formulated aPolicy for determining Material Subsidiary and the same has been hosted on the website ofthe Company at the URL http://indothai.co.in/Admin/Investors/Shareholders/Policv%20for%20Material%20Subsidiarv 09 .08.2014.pdf
CODE OF CONDUCT FOR PROHIBITION OF INSIDER TRADING
Your Company has in place a Code of Conduct for Prohibition of Insider Trading whichlays down the process of trading in securities of the Company by the employees and theconnected persons and to regulate monitor and report trading by the employees and theconnected persons of the Company either on his/her own behalf or on behalf of any otherperson on the basis of unpublished price sensitive information. During the year underreview your Company has amended the subject Code to align the same with the requirementsof Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations2015.
The policy on Insider Trading is available on the website of the Company at the URLhttp://indothai.co.in/Admin/Investors/Sharehold ers/Insider%20Trading%20Policy14052015.pdf
CODE OF PRACTICES AND PROCEDURES FOR FAIR DISCLOSURE OF UNPUBLISHED PRICESENSITIVE INFORMATION
During the year under review your Company has adopted Code of Practices and Proceduresfor Fair Disclosure of Unpublished Price Sensitive
Information with a view to lay down practices and procedures for Fair Disclosure ofUnpublished Price Sensitive Information that could impact price discovery in market forits securities in accordance with Regulation 8(1) of Securities and Exchange Board ofIndia (Prohibition of Insider Trading) Regulations 2015.
The Code of Practices and Procedures for Fair Disclosure of Unpublished Price SensitiveInformation is available on the website of the Company at the URLhttp://indothai.co.in/Admin/Investors/Sharehold ers/Code%20of%20Practices%20and%20Procedures%20for%20Fa ir%20Discl osure%20of%20UP SI.pdf
The Company has formulated a policy for archival of its records. The policy deals withthe retention and archival of records of Company and all its subsidiary(ies). Such policyis available on the website of the Company at the URLhttp://indothai.co.in/Admin/Investors/Sharehold ers/Archival%20Policy 07112015.pdf
Pursuant to the provisions of Section 177 of the Companies Act 2013 and Regulation 18of Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company had formed the Audit committee under theChairmanship of Mr. Om Prakash Gauba. The composition of Audit Committee has been statedunder Corporate Governance Report and forms an integral part of report. Allrecommendations made by Audit Committee were accepted by Board. The role of the Committeeis to provide oversight of the financial reporting process the audit process the systemof internal controls and compliance with laws.
Your Company firmly believes that employees are the most valuable assets and keyplayers of business success and sustained growth. Only with their participation we manageto achieve a healthy work culture transparency in working fair business practices andpassion for efficiency. Thus development of human resources at all levels is taken onpriority to upgrade knowledge and skill of employees and sensitize them towardsproductivity quality cost reduction safety and environment protection. The Company'sultimate objective is to create a strong and consistent team of employees wherein eachlink in the resource chain is as strong as the other. In view of this various employeebenefits recreational and team building programs are conducted to enhance employeeskills motivation as also to foster team spirit. Company also conducts inhouse trainingprograms to develop leadership as well as functional capabilities in order to meet futuretalent requirements and to enhance business operations. Industrial relations were cordialthroughout the year.
Material Changes during the Financial Year 2015-16:
During the Financial Year 2015-16 the Registered Office of the Company has beenshifted from "164th Floor Dawa Bazar R.N.T. Marg Indore Madhya Pradesh" to"Capital Tower 2nd Floor Plot Nos. 169A-171 PU4 Scheme No.- 54 Indore MadhyaPradesh 452010" w.e.f. 07.11.2015.
The office located at 16 4th Floor Dawa Bazar R.N.T. Marg Indore MadhyaPradesh (i.e. Previous Registered Office) considered as the branch of the Company w.e.f.06.02.2016.
The address of two branch offices i.e. Ahmedabad Branch and Mumbai Branch havebeen changed w.e.f. 06.02.2016 0 One of the Company's branch located at "Vijay NagarIndore" merged with "Navneet Darshan Palasia Indore" w.e.f. 06.02.2016.
The Company has decided to keep the Books of Accounts and other relevant booksand papers (including Financial Statements) kept at any place i.e. 14 & 16 4th FloorDawa Bazar R.N.T. Marg Indore Madhya Pradesh other than Registered Office w.e.f.06.02.2016.
Material Changes after the end of Financial Year 2015-16:
There have been no material changes during the Current Financial Year 2016-17and commitments affecting the financial position of the company which have been occurredbetween the end of financial year 2015-16 of the company to which the financial statementrelate and the date of report and there has been no changes in the nature of businessexcept closure of branches located at TF-33 White House complex Near Panchvaty PanchRasta Ambawadi Elli bridge Ahmedabad and 319 Panch Ratna Building Opera House Mumbaiw.e.f. 08/08/2016.
PARTICULARS OF EMPLOYEE AND RELATED DISCLOSURES
The ratio of remuneration of each director to the median of employees' remuneration asper Section 197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 forms part of theBoard's Report under "Annexure-G" as Median Remuneration.
In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment & Remuneration of Managerial Personnel) Rules 2014none of the employees are in receipt of the remuneration which is in excess of the limitsas specified in the rules.
Your Company has been observing best corporate governance practices and benchmarkitself against each such practice on continual basis. Your Company is committed forhighest standard of Corporate Governance in adherence of Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015. Pursuant toRegulation 34(3) read with Schedule V of Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 with the Stock Exchanges aReport on Corporate Governance forms an integral part of this annual report. A'Certificate' from the Practicing Company Secretary M/s Kaushal Ameta & Co.confirming compliance by the Company of the conditions of Corporate Governance asstipulated in Regulation 34(3) of Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 is also annexed as "Annexure-H"to this Board's Report.
PARTICULARS REGARDING CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS AND OUTGO
Being a Broking company we are not involved in any industrial or manufacturingactivities the Company's activities involve very low energy consumption and has noparticulars to report regarding conservation of energy and technology absorption. Howeverefforts are made to further reduce energy consumption. There has been no earnings andoutgo in foreign exchange during the financial year 2015-16.
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of the Companies (Accounts) Rules 2014 is annexed herewith and forms part of thisReport as "Annexure-I".
SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATORS/ COURTS/ TRIBUNALS
During the Financial Year 2015-16 there were no significant or material orders werepassed by the Regulators or Courts or tribunals which affect the going concern status ofthe Company and its operations in future except following :
Office of The Registrar of Companies Madhya Pradesh has issued two Show CauseNotices dated 06.07.2015 for violation under Sections 78(2)&303(1)/52(2)&170(1) ofthe Companies Act 1956/2013 respectively as per the order of Ministry the Inspection ofCompany was conducted by the Regional Director (NWCR) u/s 209A/207 of the Companies Act1956/2013 respectively on the routine basis. The Company has duly replied on the samethrough its letters dated 15.07.2015.
Office of The Registrar of Companies Madhya Pradesh has issued twenty ShowCause Notices dated 29.07.2015 & 30.07.2015 for violations under Sections of theCompanies Act 1956/2013 as per the order of Ministry the Inspection of Company wasconducted by the Regional Director (NWCR) u/s 209A/207 of the Companies Act 1956/2013respectively on the routine basis. The Company has duly replied on the same. In connectionof such SCNs Company had filed applications suo moto for compounding of offence u/s621A/441 of Companies Act 1956/2013 respectively. And in respect of each 3 (three)Petitions filed suo moto under Section 441A of the Companies Act 2013 (Compounding ofOffences) The Regional Director Ahmedabad has imposed penalty of Rs. 500/- for all 5applicants (i.e. Company Managing Director two Whole-time Directors and CompanySecretary) at hearing held on 29.03.2016 and such penalty has been paid on same day.Complete details for penalties imposed by the Regulatory Bodies are stated under CorporateGovernance Report which is a forming part of this annual report.
Other disclosures related to financial year 2015-16: + Your Company does not have anyEmployee Stock Option Scheme & Employee Stock Purchase Scheme for its Employees/Directors.
Your Company does not issue shares with differential rights as to dividendvoting or otherwise
Neither the Managing Director nor the Wholetime Director(s) of the Companyreceived any remuneration or commission from the Subsidiary of your Company + There wereno such incident occurred in relation to sexual harassment of Women at workplace(Prevention Prohibition And Redressal) Act 2013. Company has also devised a policy forAnti Sexual Harassment which is hosted on Company's website www.indothai.co.in
The National Stock Exchange of India Limited has appreciated the Company for theirsupport in making the Nifty 50 Index Derivative Contract the Worlds' Largest Traded IndexOptions Contract in 2015. The Company was also appreciated for its contribution to 1 CroreDemat Accounts opened with Central Depository Services (India) Limited.
GRATITUDE & ACKNOWLEDGEMENT
Your Board wishes to sincerely thank all its Clients & Shareholders for theirpatronage. Your Board would like to express their sincere appreciation for the assistanceand co-operation received from the Financial Institutions Banks Customers VendorsInvestors and all the other Stakeholders for their confidence and trust they have reposedin the Company. Your Board similarly expresses gratitude for the assistance andco-operation extended by SEBI BSE NSE MSEI CDSL RBI MCA ROC Central Government andGovernment of various States and other Regulatory Authorities including Local GoverningBodies. Your Board acknowledges appreciation for the invaluable support provided by theAuditors Lawyers and Consultants. We place on record our appreciation of the contributionmade by our employees at all levels our consistent growth was made possible by their hardwork solidarity cooperation and support.