Monarch Networth Capital Limited
Your Directors present the 23rd Annual Report together with Financial Statements of theCompany for the financial year ended 31st March 2016.
The of the Company is summarized below:
|Particulars ||Year ended 31st March 2016 ||Year ended 31st March 2015 |
|Total Revenue (net) ||4553.64 ||5340.32 |
|Profit before Finance Cost Depreciation & Amortization expenses and Tax ||736.82 ||1327.82 |
|Finance Cost ||598.28 ||555.30 |
|Depreciation and Amortization expenses ||180.35 ||331.15 |
|Profit/(Loss) before exceptional items and tax ||(41.81) ||441.36 |
|Add: Exceptional/Extraordinary Items and Prior Period Adjustments ||(7.57) ||(2.44) |
|Profit/(Loss) before tax ||(49.38) ||443.81 |
|Less: Provision for tax ||(96.99) ||158.50 |
|Profit / (Loss) after tax ||47.61 ||285.31 |
The total income of the Company for the year under review stood at Rs. 4553.64 Lakhs(previous year Rs. 5340.32 Lakhs). During the year the Company earned net profit of Rs.47.61 Lakhs (previous year profit of Rs. 285.31 Lakhs).
There was no change in Share Capital of the Company during the Financial Year 2015-16.
In order to conserve the resources for future business requirements your Directors donot recommend dividend for the year under review.
During the year under review the Company has not accepted any deposits within themeaning of Section 73 and 76 of the Companies Act 2013 read with Companies (Acceptance ofDeposits) Rules 2014.
The Securities and Exchange Board of India (SEBI) on September 2 2015 issued SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 with the aim toconsolidate and streamline the provisions of Listing Agreement for different segments ofcapital markets to ensure better enforceability. The said regulations were effective fromDecember 1 2015. Accordingly all listed entities were required to entire into theListing Agreement within six months from the effective date The company entered into theListing Agreement with Bombay Stock Exchange Limited on 12th February 2016.
EXTRACT OF ANNUAL RETURN:
An extract of Annual Return in Form MGT 9 is appended to this Report as Annexure - 1.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
In accordance with the provisions of Section 152 of the Companies Act 2013 read withCompanies (Management & Administration) Rules 2014 and Articles of Association of theCompany Mrs. Manju Bafna Whole-Time Director of the Company retires by rotation at theensuing Annual General Meeting and being eligible has offered herself for re-appointment.
Mr. Vaibhav Shah whose term as Managing Director was valid till 30th November 2015was re- appointed as an Managing Director of the Company for a period of 3 (Three) Yearswith effect from 01st December 2015 to 30th November 2018 subject to the approval ofshareholders in the ensuing General Meeting and being eligible offers himself forre-appointment.
Your Board recommends their appointment / re-appointment of the above Directors.
During the year under review the following changes had taken place in the Board ofDirectors of the Company:
|Sr. No. ||Name ||Designation ||Date of Appointment (During the year) ||Date of Resignation |
|1. ||Mr. Suresh P. Jain ||Chairman cum director ||NA ||12th February 2016 |
|2. ||Mr. Vaibhav Shah ||*Chairman cum Managing Director ||*Managing Director- w.e.f. 01st December 2015 & Chairman w.e.f. 12th February 2016 ||NA |
Additional Information on directors recommended for appointment/re-appointment asrequired under Regulation 26 (3) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 at ensuing Annual General Meeting are given in theNotice convening 23rd Annual General Meeting.
MEETINGS OF THE BOARD:
The Board meets at regular intervals to discuss and decide on Company and businessstrategies. The notice of Board meeting is given well in advance to all the Directors ofthe Company. Usually meetings of the Board are held in the registered office of theCompany. The agenda of the Board / Committee meetings is circulated 7 days prior to thedate of the meeting.
The Board met 14 (fourteen) times during the year the details of which are given inthe Report on Corporate Governance. The intervening gap between the two consecutivemeetings was within the period prescribed under the Companies Act 2013 and the ListingAgreement.
ANNUAL PERFORMANCE EVALUATION BY THE BOARD:
SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 mandates thatthe Board shall monitor and review the Board evaluation framework. The framework includesthe evaluation of directors on various parameters such as:
i. Board dynamics and relationships
ii. Information flows
iv. Relationship with stakeholders
v. Company performance and strategy
vi. Tracking Board and committees effectiveness
vii. Peer evaluation
Pursuant to the provisions of the Companies Act 2013 a formal annual evaluation needsto be made by the Board of its own performance and that of its committees and individualdirectors. Schedule IV of the Companies Act 2013 states that the performance evaluationof the independent directors shall be done by the entire Board of Directors excluding thedirector being evaluated. The Board works with the nomination and remuneration committeeto lay down the evaluation criteria.
The Board has carried out an evaluation of its own performance the directorsindividually as well as the evaluation of the working of its
Audit Committe Nomination & Remuneration Committee and Stakeholders RelationshipCommittees of the Company. The Board has devised questionnaire to evaluate theperformances of each of executive non-executive and Independent Directors. Such questionsare prepared considering the business of the Company and the expectations that the Boardhave from each of the Directors. The evaluation framework for assessing the performance ofDirectors comprises of the following key areas:
i. Attendance of Board Meetings and Board Committee Meetings;
ii. Quality of contribution to Board deliberations;
iii. Strategic perspectives or inputs regarding future growth of Company and itsperformance;
iv. Providing perspectives and feedback going beyond information provided by themanagement.
v. Ability to contribute to and monitor our corporate governance practices
DECLARARTION BY INDEPENDENT DIRECTORS:
The Company has received necessary declaration from all the Independent Directors ofthe Company under sub-section (7) of Section 149 of the Companies Act 2013 confirmingthat they meet the criteria of independence as prescribed under sub-section (6) of Section149 of the
Companies Act 2013 and Regulation 25 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
COMMITTEES OF THE BOARD:
There are currently three Committees of the Board as follows:
1. Audit Committee
2. Stakeholders Relationship Committee
3. Nomination and Remuneration Committee
Details of all the Committees along with their charters composition and meetings heldduring the year are provided in the Report on Corporate Governance and forms part of thisAnnual Report.
AUDIT COMMITTEE AND ITS COMPOSITION:
The Audit Committee is duly constituted as per the provisions of Section 177 of theCompanies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. The composition of the Audit Committee is given in Report on CorporateGovernance which is annexed to this report.
The Audit Committee of the Company reviews the reports to be submitted to the Board ofDirectors with respect to auditing and accounting matters. It also supervises theCompanys internal control and financial reporting process.
WHISTLE BLOWER POLICY:
The Company has adopted a Vigil mechanism / Whistle blower Policy to deal with instanceof fraud and mismanagement if any. The Company had established a mechanism for directorsand employees to report concerns about unethical behavior actual or suspected fraud orviolation of our Code of Conduct and Ethics. The mechanism also provides for adequatesafeguards against victimization of directors and employees who avail of the mechanism andalso provide for direct access to the Chairman of the Audit Committee in the exceptionalcases. The details of the Vigil mechanism Policy is explained in the report of CorporateGovernance and also posted on the website of the Company. We affirm that during thefinancial year 2015-2016 no employee or director was denied access to the AuditCommittee.
Pursuant to provisions of Section 178 of the Companies Act 2013 and SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 and on the recommendation ofthe Nomination and Remuneration Committee the Board has adopted a Policy on criteria forappointment of Directors Key Managerial Personnel Senior Management and theirremuneration. The salient features of the Remuneration Policy are stated in the Report onCorporate Governance which forms part of this Annual Report.
RISKS AND AREAS OF CONCERN:
The Company has laid down a well-defined Risk Management Policy to identify the riskanalyse and to undertake risk mitigation actions. The Board of Directors regularlyundertakes the detailed exercise for identification and steps to control them through awell-defined procedure.
DIRECTORS RESPONSIBILITY STATEMENT:
As required under Section 134(3)(c) of the Companies Act 2013 and according to theinformation and explanations received by the Board your Directors state that:
a. in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;
b. the directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year and ofthe profit of the company for that period;
c. the directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
d. the directors have prepared the annual accounts on a going concern basis;
e. the directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and
f. the directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
SUBSIDIARIES AND ASSOCIATE COMPANIES:
The Company has 5 (five) Subsidiary Companies. During the year the Board of Directors(the Board) reviewed the affairs of the subsidiaries. In accordance withSection 129(3) of the Companies Act 2013 we have prepared consolidated financialstatements of the Company and all its subsidiaries which form part of the Annual Report.Further a statement containing the salient features of the financial statement of oursubsidiaries in the prescribed format AOC-1 is appended as Annexure II to theBoards report. The statement also provides the details of performance financialpositions of each of the subsidiaries.
The Company does not have any Joint Venture.
In accordance with Section 136 of the Companies Act 2013 the audited financialstatements including the consolidated financial related information of the Company andaudited accounts of each of its subsidiaries are available on the Companys websitewww.mnclgroup. com. These documents will also be available for inspection at theregistered office of the Company and of the subsidiary companies during business hours onall working days and during the Annual General Meeting.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
The details of loans guarantee or investment under Section 186 of the Companies Act2013 forms part of Notes to the Financial Statements provided in this Annual Report.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All Related Policy Transactions entered during the year were in Ordinary Course of theBusiness and on Arms Length basis. No Material Related Party Transactions enteredduring the year by your Company as per Section 188 of the Companies Act 2013 whichrequire approval of the member. Accordingly the disclosure of Related Party Transactionsas required under Section 134(3) of the Companies Act 2013 in Form AOC-2 is notapplicable.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE:
There was no significant or material order passed by any regulator or court ortribunal which impacts the going concern status of the Company or will have bearing oncompanys operations in future.
CORPORATE SOCIAL RESPONSIBILITY:
Due to insufficient profits Corporate Social Responsibility is not applicable to theCompany.
At the 22nd Annual General Meeting of the Company held on 30thSeptember 2015 M/s. Parekh Shah and Lodha Chartered Accountants Mumbai (having FRN:107487W) were appointed as Statutory Auditors of the Company to hold office upto theconclusion of 26th Annual General Meeting. In terms of Section 139 of theCompanies Act 2013 the appointment of the auditors shall be placed for ratification atevery Annual General Meeting of the Company. Accordingly the appointment of M/s. ParekhShah and Lodha Chartered Accountants Mumbai (having FRN: 107487W) as Statutory Auditorsof the Company is placed for ratification by the shareholders and to fix remuneration forthe financial year ending 31st March 2017.
The Auditors Report for the year ended 31st March 2016 does notcontain any qualification reservation or adverse remark. The Auditors Report isenclosed with Financial Statements in this Annual Report.
The Company has re-appointed M/s. Nautam Vakil & Co. Chartered AccountantsAhmedabad as its Internal Auditor. The Internal Auditor has given his reports on quarterlybasis to the Audit Committee.
Based on the report of internal audit management undertakes corrective action in therespective areas and strengthens the levels of Internal Financial and other operationalcontrols.
INTERNAL FINANCIAL CONTROL:
The Board has adopted policies and procedures for efficient conduct of business. TheAudit Committee evaluates the efficacy and adequacy of financial control system in theCompany its compliance with operating systems accounting procedures and policies at alllocations of the
Company and strives to maintain the Standard in Internal Financial Control.
SECRETARIAL AUDIT REPORT:
Pursuant to the provisions of Section 204 of the Companies Act 2013 the SecretarialAudit Report received from M/s. VKM & Associates Practising Company SecretariesMumbai is provided in Annexure III and forms part of this Annual report.
Secretarial Auditors Remarks:
With respect to the Remark(s)/Observations or disclaimer made by the SecretarialAuditors in their Report we hereby state that the charges appearing on the MCAsWebsite with respect to loan taken from HDFC Bank Limited State Bank of Saurashtra andCorporation Bank have already been satisfied by the Company. However the company is inprocess of obtaining the requisite letter from bank for satisfaction.
The Equity Shares of the Company are listed at BSE Limited. The Company has paid theAnnual listing fees for the year 2016-2017 to the said Stock Exchange.
CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND ANALYSIS:
Corporate Governance is about maximizing shareholders value legally ethically andsustainability. At Monarch Networth the goal of Corporate Governance is to ensurefairness for every stakeholder. We believe Corporate Governance is critical to enhance andretain investor trust. Our Board exercises its judiciary responsibilities in the widestsense of the term. We also endeavor to enhance long-term shareholder value and respectminority rights in all our business decisions.
The following have been made a part of the Annual Report:
Management Discussion and Analysis
Report on Corporate Governance of conditions of Corporate Governance.
Certificate regarding CEO/CFO Certification in terms of the Regulation 17 (8) ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013:
The Company has zero tolerance for sexual harassment at workplace and adopted a Policyon prevention prohibition and redressal of sexual harassment at workplace in line withthe provisions of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 and the Rules thereunder. There was no complaint on sexual harassmentduring the year under review.
PARTICULARS OF REMUNERATION:
Pursuant to Section 197 of the Companies Act 2013 read with Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 details of the ratioof remuneration of each Director to the median employees remuneration are appendedto this report as Annexure IV.
During the year under review no employee was in receipt of remuneration exceeding thelimits as prescribed under provisions of Section 197 of the Companies Act 2013 and Rule5(2) and 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules2014.
PARTICULARS OF CONSERVATION OF ENERGY TECHONOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO:
Pursuant to Section 134(3)(m) of the Companies act 2013 read with Rule 8 of theCompanies (accounts) rules 2014 details regarding the Conservation of Energy TechnologyAbsorption and Foreign Exchange Earnings and Outgo for the year under review are asfollows:
A. Conservation of Energy
a. Steps taken or impact on conservation of energy - The Operations of the Company donot consume energy intensively. However the Company continues to implement prudentpractices for saving electricity and other energy resources in day-to-day activities.
b. Steps taken by the Company for utilizing alternate sources of energy - Though theactivities undertaken by the Company are not energy intensive the Company shall explorealternative sources of energy as and when the necessity arises.
c. The capital investment on energy conservation equipment Nil
B. Technology Absorption
a. The efforts made towards technology absorption - The Company continues to takeprudential measures in respect of technology absorption adaptation and takeinnovative steps to use the scarce resources effectively.
b. The benefits derived like product improvement cost reduction product developmentor import substitution- Not Applicable
c. In case of imported technology (imported during the last three years reckoned fromthe beginning of the financial year) - Not Applicable
d. The expenditure incurred on Research and Development - Not Applicable
The Particulars of Foreign Exchange and Outgo for the year under review are as follows:
(Figures in Rs.)
|Particulars ||Year ended 31st March 2016 ||Year ended 31st March 2015 |
|Foreign exchange earning ||10841 ||Nil |
|Foreign exchange Outgo ||Nil ||Nil |
Your Directors wish to place on record their gratitude and deep appreciation for thecontinued support and co-operation received by the Company from the shareholderscompanys clients suppliers bankers and employees and look forward for theircontinued support in the future as well.
| ||For and on behalf of the Board of Directors |
|Place: Mumbai ||Vaibhav Shah ||Manju Bafna |
|Date: 03rd September 2016 ||Chairman cum Managing Director ||Whole-Time Director |
Pursuant to provisions of Section 129(3) of the Companies Act 2013 read with Companies(Accounts) Rules 2014 Statement containing salient features of the Financial Statement ofSubsidiary Companies/Associate Companies/Joint Ventures
PART A - SUBSIDIARY COMPANIES
(Rs. In Lakhs)
|Particulars ||Networth Commodities & Investments Ltd. ||Networth Wealth Solutions Ltd. ||Ravisha Financial Services Pvt. Ltd. ||Networth Insurance Broking Pvt. Ltd. ||Monarch Networth Investment Advisors Pvt Ltd. (Formerly known as Monarch Insurance Broking Pvt. Ltd.) |
|Reporting period for the subsidiary concerned if different from the holding companys reporting period ||31.03.2016 ||31.03.2016 ||31.03.2016 ||31.03.2016 ||31.03.2016 |
|Reporting currency and Exchange rate as on the last date of the relevant Financial year in the case of foreign subsidiaries ||Indian Rupees ||Indian Rupees ||Indian Rupees ||Indian Rupees ||Indian Rupees |
|Equity Share Capital ||140.07 ||100.00 ||800.00 ||1.00 ||50.00 |
|Reserves ||57.03 ||(1088.90) ||(294.47) ||(0.65) ||(4.55) |
|Total Assets ||1102.14 ||49.76 ||2816.98 ||3.09 ||50.11 |
|Total Liabilities ||905.04 ||1038.66 ||2311.45 ||2.74 ||4.66 |
|Investments (except in subsidiary companies) ||0.49 ||0.00 ||0.00 ||0.00 ||0.00 |
|Total Turnover ||260.40 ||43.92 ||392.35 ||0.00 ||0.00 |
|Profit/(Loss) before Taxation ||60.56 ||(5.87) ||(31.86) ||(0.02) ||(0.08) |
|Provision for Taxation ||22.08 ||0.24 ||0.56 ||0.00 ||0.00 |
|Profit /(Loss) after Taxation ||38.47 ||(6.11) ||(32.43) ||(0.02) ||(0.08) |
|Proposed Dividend ||0.00 ||0.00 ||0.00 ||0.00 ||0.00 |
|% of shareholding ||99.95 ||100.00 ||100.00 ||100.00 ||100.00 |
1 Names of subsidiary which are yet to commence operations : None
2 Names of subsidiaries which have been liquidated or sold during the year: None
PART B - ASSOCIATES AND JOINT VENTURES
Statement pursuant to Section 129(3) of the Companies Act 2013 related to AssociateCompanies
|Sr No. Name of the Associates ||Networth Financial Services Limited ||Networth SoftTech Ltd. |
|1 Latest audited Balance Sheet Date ||31.03.2016 ||31.03.2016 |
|2 Shares of Associate/Joint Ventures held by the company on the year end || || |
|No. ||949400 ||1500000 |
|Amount of Investment in Associates/Joint Venture ||9494000 ||15000000 |
|Extend of Holding % ||45.32 ||20.91 |
|3 Description of how there is significant influence ||Shares held in the company ||Shares held in the company |
|4 Reason why the associate/joint venture is not consolidated ||NA ||NA |
|5 Networth attributable to Shareholding as per latest audited || || |
|Balance Sheet || || |
|6 Profit / Loss for the year || || |
|i. Considered in Consolidation ||0.24 ||4.84 |
|i. Not Considered in Consolidation ||NA ||NA |
1. Names of associates which are yet to commence operations: None
2. Names of associates/Joint Ventures which have been liquidated or sold during theyear: None
| || || ||For and on behalf of the Board of Directors || |
|Place: Mumbai ||Vaibhav Shah ||Manju Bafna ||Ashok Bafna ||Sophia Jain |
|Date: 3rd September 2016 ||Chairman cum Managing Director ||Whole-Time Director ||Chief Financial Officer ||Company Secretary & Compliance Officer |