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Palred Technologies Ltd.

BSE: 532521 Sector: IT
NSE: PALREDTEC ISIN Code: INE218G01033
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VOLUME 9741
52-Week high 181.80
52-Week low 61.20
P/E
Mkt Cap.(Rs cr) 93
Buy Price 0.00
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Sell Price 95.15
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OPEN 99.75
CLOSE 96.00
VOLUME 9741
52-Week high 181.80
52-Week low 61.20
P/E
Mkt Cap.(Rs cr) 93
Buy Price 0.00
Buy Qty 0.00
Sell Price 95.15
Sell Qty 290.00

Palred Technologies Ltd. (PALREDTEC) - Director Report

Company director report

Dear Members

The Board of Directors hereby submits the report of the business and operations of yourCompany (‘the Company’ or ‘Palred’) along with the audited financialstatement for the financial Year ended March 31 2016. The Consolidated performance of theCompany and its subsidiaries has been referred to where required.

1. FINANCIAL SUMMARY OPERATION/ RESULTS OF OUR OPERATION:

The financial performance during the financial year 2015-2016 is as hereunder:

(Rs. In Lakhs)

Particulars Standalone Consolidated
31-Mar-16 31-Mar-15 31-Mar-16 31-Mar-15
Audited Audited Audited Audited
Income from operations - 216.53 3818.33 704.98
Total expenses 307.00 578.14 6233.84 1263.78
Profit / (Loss) from operations before other income finance costs and exceptional items (307.00) (361.61) (2415.51) (558.80)
Other income 230.00 621.43 306.90 650.51
Profit / (Loss) from ordinary activities before finance costs and exceptional items (87.87) 259.29 (2108.61) 91.71
Finance costs (0.87) (0.53) (38.74) (0.98)
Profit / (Loss) from ordinary activities after finance costs but before exceptional items - - (2147.35) 90.73
Exceptional items - -
Profit / (Loss) from ordinary activities before tax (87.87) 259.29 (2147.35) 90.73
Tax expense (10.94) Nil (9.80) (1.14)
Net Profit / (Loss) from ordinary activities after tax (98.81) 259.29 (2157.15) 89.59
Extraordinary items (net of tax expense) - - - -
Net Profit / (Loss) for the period/year (98.81) 259.29 (2157.15) 89.59
Paid-up equity share capital (Face value `10 per share) : (refer note 3) 821.31 1951.85 821.31 1951.85
Reserve excluding revaluation reserves as per balance sheet of previous accounting year 5007.97 6948.39 3299.62 7014.24
Earnings Per Share (Basic and Diluted) -0.89 1.32 (14.40) 0.64

Notes: The above figures are extracted from the standalone and consolidatedfinancial statements.

Share Capital

i. As detailed in the Annual Report 2014-2015 the Company has pursuant to Hon’bleHigh court order dated 09.06.2015 reduced the paid up capital of the Company to theextent of sixty percent which is in excess of the business requirements of the Company.The record date fixed by the Board of Directors for Reduction of Equity Share Capital wasJuly 9 2015. The company has paid Rs. 16.50/- per Equity Share to Equity Share Holders ofthe Company for 60% shareholding reduced by the Company. Consequently the issuedsubscribed and Paid-up capital shall stand reduced to Rs. 78073940 consisting of15614788 Equity Shares of Rs. 5/- each pursuant to Capital reduction.

ii. The Company has allotted 811379 fully paid-up equity shares of Rs. 5/- per sharevide Preferential Allotment dated December 16 2016.

iii. The Company has consolidated its 2 equity shares of Rs. 5 each into 1 equity shareof Rs. 10 each in its Extra-Ordinary General meeting held on 13 November 2015. Subsequentto year ended 31 March 2016 the Company obtained the necessary approval from the stockexchanges and trading of equity shares with new face value of Rs. 10 per share has resumedeffective from 9 May 2016. The effect of this consolidation of equity shares has beengiven in computing earnings per share of all periods presented.

iv. (a) Pre-Consolidation The Authorised and Paid up Capital of the Company is Rs. 35Crores divided into (a) 56077600 Equity Shares of Rs. 5/- (Rupees Five Only) each and(b) 696120 Redeemable Preference Shares of Rs.100/-(Rupees One Hundred only).

(b) Post Consolidation the Authorised and Paid up Capital of the Company is Rs. 35Crores divided into (a) 28038800 Equity Shares of Rs. 10/- (Rupees Ten Only) each and(b) 696120 Redeemable Preference Shares of Rs.100/-(Rupees One Hundred only).

Review of operations: Revenues – standalone:

Our total income on a standalone basis is Rs. 220 Lakhs as against 621.43 Lakhs inprevious year. The Change in Income is on account of Discontinuation of Online E-Commercebusiness from October 2014 which is operated by Subsidiary Company Palred OnlineTechnologies Private Limited.

Revenues – Consolidated

Our total income on a consolidated basis increased to Rs. 3818.33 Lakhs from Rs 704.98Lakhs in the previous year. Our revenues from Palred Online Technologies Private Limitedthe e-commerce subsidiary of the Company increased to Rs. 3809.93 Lakhs from 693.25 Lakhsin the previous year. The revenue for Palred Technology Services Private Limited is Rs.38.4 Lakhs in the 2015-2016.

Profits/Loss - standalone

Loss on Standalone Basis is 98.81 Lakhs as against profit of Rs 259.29 Lakhs inPrevious Year. The Change is on account of Discontinuation of Online E-Commerce businessfrom October 2014 which is operated by Subsidiary Company Palred Online TechnologiesPrivate Limited.

Profits/Loss - consolidated

Loss on a consolidated basis amounted to Rs. 2157.15 Lakhs as against Profits of Rs.89.59 Lkahs in previous Year.

Distribution and Business Promotion Expenses amounted to Rs. 3474.46 and 428.93 Lakhsfor the years ended March 31 2016 and March 31 2015.

Purchase of Stock was Rs. 1527.06 and 690.00 for the years ended March 31 2016 andMarch 31 2015.

Capital expenditure on tangible assets - standalone

This year on a standalone basis we capitalized Rs. 1.42 Lakhs. This Comprises Rs.1.20 Lakhs for investment in Computer Equipment and the balance Rs 0.22 Lakhs oninfrastructures.

Capital expenditure on tangible assets - consolidated

On a consolidated basis we capitalised Rs. 83.02 Lakhs. During the current year Rs32.3 Lakhs has been invested in computer equipment and the balance Rs 51.72 Lakhs onInfrastructure.

Liquidity

We continue to be debt-free and maintain sufficient cash to meet our strategicobjectives.

Particulars of Loans guarantees and investments:

Loans guarantees and investments covered u/s 186 of the Companies Act 2013 form partof the financial Statements provided in the Annual report.

Dividend:

Since the Company has ventured in to new businesses after sale of its business anddistribution of sale proceeds among its shareholders your Board of Directors regret theirinability to declare dividend for the financial year 2015-2016.

Transfer to Reserves:

The Company has not transferred/proposes to transfer any amount to Reserves.

Public Deposits:

Your Company has not accepted any deposits falling within the meaning of Sec. 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014 during thefinancial year under review.

Credit & Guarantee Facilities:

The Company has not availed any facilities of Credit and Guarantee.

Corporate Social Responsibility Policy:

Since your Company does not have the net worth of Rs. 500 Crore or more or turnover ofRs. 1000 Crore or more or a net profit of Rs. 5 Crore or more during preceding 3financial years section 135 of the Companies Act 2013 relating to Corporate SocialResponsibility is not applicable and hence the Company need not adopt any Corporate SocialResponsibility Policy.

Risk Management Policy:

Your Company follows a comprehensive system of Risk Management. Your Company hasadopted a procedure for assessment and minimization of probable risks. It ensures that allthe risks are timely defined and mitigated in accordance with the well structured riskmanagement process.

Particulars of Contracts or Arrangements with related Parties:

Particulars of Contracts or arrangements with Related Parties referred to in Section188(1) of the Companies Act 2013 in the Prescribed Form AOC-2 is appended as Annexure 2to Board’s Report.

Ratio of Remuneration to Each Director:

Under section 197(12) of the Companies Act 2013 and Rule 5(1) (2) & (3) of theCompanies(Appointment & Remuneration) Rules 2014 the ratio of remuneration paid toManaging Director and maiden employees is 3:1

Material changes and commitments affecting the financial position of the companybetween the end of the financial year of the company to which the financial statementsrelate and the date of the report:

(1) The Shareholders of the Company have at the ExtraOrdinary General Meeting held on13 November 2015 approved consolidation of 2 equity shares of Rs. 5 each into 1 equityshare of Rs. 10 each. Subsequent to year ended 31 March 2016 the Company obtained thenecessary approval from the stock exchanges and trading of equity shares with new facevalue of Rs. 10 per share has resumed effective from 9 May 2016.

(2) As on March 31 2016 the Company has 98.8% stake in Palred Technology ServicesPrivate Limited. On June 20 2016 the Company has acquire 100% stake by Acquisition ofBeneficial Interest in shares of Palred Technology Services Private Limited making it awholly owned subsidiary of Palred Technologies Limited.

Management Discussion and Analysis:

In terms of the provisions of Regulations 34 of Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) 2015 the Management’s Discussionand Analysis is set out in this Annual report.

II) BUSINESS Strategy:

Our Strategic objective is to build multiple verticals in E-Commerceand IT and ITrelated business and obtain sustainable growth. The Key word for the year has been"PERSEVERENCE" and this has been applied to everything we do.

Subsidiaries:

The new domains of Business which have gained momentum during the year are e-commerceand IT solutions for E-commerce

At the beginning of the year we had two direct subsidiaries –

a) Palred Online Technologies Private Limited and

b) Palred Technology Services Private Limited.

During the year we have established 2 step down Subsidiaries

a) Palred Technology Services USA – subsidiary of Palred Technology ServicesPrivate Limited and

b) Palred Online Bilism Teknoljileri Ticaret Anonim Sirketi Turkey Istanbul –subsidiary of Palred Online Technologies Private Limited.

Palred Online Technologies Private Limited:

Palred Online Technologies Private Limited owns and operates e-commerce portalLatestone.com India’s only e-tailer specialized in tech and mobile accessories suchas Bluetooth devices mobile covers tablet accessories cables power banks Android TVsheadsets smart watches or CCTV’s it stocks over 10000 different products in itsinventory and operates through its own Fulfillment centers in Hyderabad and Delhi.

During the year the company has continued its aggressive growth and has declared a 450%growth in net revenue on a year on year basis. In a very short span of time LatestOne.com has reached a milestone by achieving an average of 4000 orders per day from anaverage of 100 orders per day in the beginning. The website receives over 3.5 Millionvisitors in a month and till date has successfully shipped / delivered more than onemillion orders since the commencement of its operations.

The average order value on LatestOne.com has increased from INR 450 in 2014-2015 to INR700 in 2015-2016 The market size of Tech & Mobile accessories market in India isestimated at Rs. 18000 crores by Value It is the fastest growing product range in theonline category and the Market is expected to grow 20-25% year-on-year for the next 3years.

The Company also plans to increase revenue by expanding product categories sellingquality products and creating long term goodwill and set up fulfilment centres toprovide quicker delivery of products sourced locally.

Post Closure of Financial Year the Company has developed a hybrid model and convertedthe existing Business Model into a managed marketplace. The Company also established aFulfillment Centre in Mumbai.

Palred Technology Services Private Limited.

Palred Technology Services Private Limited is the IT vertical of Palred. It provides ITsolutions to access relevant data provided in a timely and cost-effective mannerdevelopment of software program for ecommerce portal latestone.com.

During the year the Board of Directors (the Board’) reviewed the affairs of thesubsidiaries. In accordance with Section 129(3) of the Companies Act 2013 we haveprepared consolidated financial statements of the Company which forms part of this AnnualReport.

Highlights of performance of subsidiary companies and their contribution to the overallperformance of the company during the period under report have been indicated in theBoards’ Report wherever required. Further a statement containing the salientfeatures of the financial statement of our subsidiaries in the prescribed format AOC-l isappended as Annexure 1 to the Board’s report. The statement provides the details ofperformance and financial positions of each of the subsidiaries.

In accordance with Section 136 of the Companies Act 2013 the audited financialstatements including the consolidated financial statements are available on our websitewww. palred.com.

Investment in Subsidiaries:

a) Palred Online Technologies Private Limited:

On July 29 2015 and May 30 2016 the Board of Palred Technologies Limited authorisedthe Company to invest Rs. 10 crores and Rs. 5 Crores respectively in Palred OnlineTechnologies Private Limited.

The Company has undertaken valuation by an independent valuer and accordingly theinvestment was made at Rs. 11.50/- per share including a premium of Rs.1.50/- per share .

The Company holds 82% stake in the said subsidiary.

b) Palred Technology Services Private Limited:

On July 29 2015 the Board of Palred Technologies Limited authorised the Company toinvest Rs. 5 Crores in Palred Technology Services Private Limited.

The Company holds 99.8% stake in the said Subsidiary. The Company has acquiredBeneficial Interest from the shareholders on June 20 2016 and Palred Technology ServicesPrivate Limited is now a wholly owned Subsidiary of Palred Technologies Limited.

Branding:

PALRED PTRON and LATESTONE are key intangible assets of the Company and itssubsidiaries.

III. HUMAN RESOURCE MANAGEMENT

Post sale of Business in 2013 the Company has been venturing new areas of operations.We have received 450 (Approximate) applications from prospective employees. Palred groupadded 200 employees during 2015-2016 taking the total strength to 185 as on 31.03.2016from 93 as on 31.03.2015.

Your Directors are pleased to record their sincere appreciation of the contribution bythe sta_ at all levels in the improved performance of the Company.

None of the employees is drawing Rs. 850000/- and above per month or Rs.10200000/-and above in aggregate per annum the limits prescribed under Section 134 of the CompaniesAct 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014.

Particulars of employees

The ratio of remuneration of each director to the median of employees’remuneration as per Section 197(12) of the Companies Act 2013 read with Rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed tothe Board’s report. (Annexure 3).

IV. CORPORATE GOVERNANCE

Our Corporate Governance Philosophy:

An effective corporate governance is crucial for the management of a company’sbusiness affairs as well as for money market communication. Our commitment to highercorporate governance standards is our chance to demonstrate our dedication towell-balanced and transparent rules to the market participants and emphasize theimportance of our clearly defined management tools and responsibilities internally

Palred believes that sound corporate governance is critical to enhance and retaininvestor trust. Accordingly we always seek to attain performance with integrity. TheBoard extends its fiduciary responsibilities in the widest sense of the term and aims atenhancing long term shareholder value and respect minority rights in all businessdecisions.

Palred in its continuous initiative and drive towards good governance andaccountability has upheld the corporate governance through ethical business practicesintegrity and transparent business operations. Palred has full support of the board andemployees in the corporate governance initiative.

At the core of the corporate governance practice is the board which oversees how themanagement serves and protects the interests of all the stakeholders of the company.Palred believes that an active well informed and independent board is necessary to ensurehighest standards of corporate governance.

Number of meetings of the Board

The Board met ten times during the financial year the details of which are given inthe Corporate governance report. The maximum interval between any two meetings did notexceed 120 days as prescribed in the Companies Act 2013.

Directors’ appointment and remuneration

The company has majority of Independent Directors on Board. On March 31 2016 theBoard consists of four members one executive Director and 3 are independent directors.

We affirm that the remuneration paid to the directors is as per the terms laid out inthe nomination and remuneration policy of the Company.

None of the Independent / Non-Executive Directors has any pecuniary relationship ortransactions with the Company which may affect the independence of the Directors.

Board evaluation

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 :

• Board dynamics and relationships

• Information flows

• Decision-making

• Relationship with stakeholders

• Company performance and strategy

• Tracking Board and committees’ effectiveness

• Peer evaluation

The Companies Act 2013 states that a formal annual evaluation needs to be made by theBoard of its own performance and that of its committees and individual directors. ScheduleIV of the Companies Act 2013 states that the performance evaluation of independentdirectors shall be done by the entire Board of Directors excluding the director beingevaluated.

The evaluation of all the directors and the Board as a whole was conducted based on thecriteria and framework adopted by the Board.

The evaluation process has been explained in the Corporate Governance report. The Boardapproved the evaluation results as collated by the nomination and remuneration committee.

Code of conduct

In compliance with Regulation 26(3) of the SEBI (Listing Obligations and DisclosureRequirements) Regulation 2015 and the Companies Act 2013 the Company has framed andadopted a Code of Conduct and Ethics (the Code’). The Code is applicable to themembers of the Board the executive officers and all employees of the Company and itssubsidiaries. The Code is available on our website www. palred.com.

All members of the Board the executive officers and senior financial officers haveaffirmed compliance to the Code as on March 31. 2016.

A declaration to this effect Signed by the Chairman and MD forms part of the AnnualReport.

Independent directors

The Companies Act 2013 provides for the appointment of independent directors.Sub-section (10) of Section 149 of the Companies Act 2013 (e_ective April 1 2014)provides that independent directors shall hold office for a term of up to five consecutiveyears on the board of a company; and shall be eligible for re-appointment on the passingof a special resolution by the shareholders of the Company. Accordingly all independentdirectors were appointed by the shareholders Annual General Meeting as required underSection 149(10).

Further Section 149(11) states that no independent director shall be eligible to serveon the board for more than two consecutive terms of five years. Section 149(13) statesthat the provisions of retirement by rotation as defined in subsections (6) and (7) ofSection 152 of the Act shall not apply to such independent directors. None of theindependent directors will retire at the ensuing AGM.

Declaration by Independent Directors

The Company has received necessary declaration from each independent director underSection 149(7) of the Companies Act 2013 that he/she meets the criteria of independencelaid down in Section 149(6) of the Companies Act 2013 and Regulation 25 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.

Directors and Key Managerial Personnel :

Mr. Palem Srikanth Reddy is the Chairman and Managing Director of the Company. Mrs.Richa Patnaik Mr. Atul Sharma and Mr. S. Vijaya Saradhi are the Independent Directors onBoard of Palred.

Inductions and Resignations:

a) Mr. Atul Sharma Mr. S. Vijaya Saradhi and Mrs. Richa Patnaik have been appointed asIndependent Directors at the AGM held on 30.09.2015 for a period of 5 years.

b) The Board on the recommendation of the Nomination and Remuneration Committeeappointed Mrs. N Archana Sastry as Company Secretary effective October 15 2015.

c) Mr. T.R.Sivarama Krishnan and Mr Mohan Krishna Reddy have resigned from the post ofDirectors w.e.f. 14.08.2015.

d) Ms. A. Amala has resigned resigned from the post of Directors w.e.f. 29.08.2015respectively.

e) Mr. E. Srinivas Prasad has resigned from the post of Director w.e.f 31.08.2015

Committees of the Board:

Currently he Board has 4 committees: The Audit Committee the Nomination andRemuneration Committee the Stakeholder Relationship Committee and the Risk ManagementCommittee. A detailed note on composition of the Board and its committees is provided inthe Corporate Governance Section of the Annual Report.

Internal financial control and its adequacy

The Board has adopted policies and procedures for ensuring the orderly and efficientconduct of its business including adherence to the Company’s policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial disclosures.

Significant and material orders

There are no Significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and Company’s operations in future.

Extract of annual return

In accordance with Section 134(3)(a) of the Companies Act 2013 an extract of theannual return in the prescribed format is appended as Annexure 4 to the Boards’report.

Secretarial Standards:

The company is in compliance with Secretarial Standards issued by The Institute ofCompany Secretaries of India on Meetings of the Board of Directors and General Meeting.

Vigil Mechanism:

Vigil Mechanism Policy has been established by the Company for directors and employeesto report genuine concerns pursuant to the provisions of section 177(9) & (10) of theCompanies Act 2013. The same has been placed on the website of the Companywww.palred.com.

Directors’ responsibility statement

The financial statements are prepared in accordance with mandatory accounting standardsas prescribed under Section 133 of the Companies Act 2013 (the Act’) read with Rule7 of the Companies (Accounts) Rules 2014 the provisions of the Act (to the extentnotified) and guidelines issued by the Securities and Exchange Board of India (SEBI).There are no material departures from the prescribed accounting standards in the adoptionof these standards.

The directors confirm that:

• In preparation of the annual accounts for the financial year ended March 312016 the applicable accounting standards have been followed.

• They have selected such accounting policies and applied them consistently andmade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at the end of the financial year and of theprofit and loss of the Company for that period.

• They have taken proper and sufficient care towards 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.

• They have prepared the annual accounts on a going concern basis.

• They have laid down internal financial controls which are adequate and areoperating effectively

• They have devised proper systems to ensure compliance with the provisions of allapplicable laws and such systems are adequate and operating effectively.

V. Auditors

Statutory auditors

At the Annual General Meeting held on September 30 2015 Walker Chandiok &. Co.LLP Chartered Accountants were appointed as statutory auditors of the Company to holdoffice till the conclusion of the next Annual General Meeting to be held in the calendaryear 2016.

The Company has already received letter from them to the effect that their appointmentif made by the shareholders would be within the prescribed limits and that they are notdisqualified for re-appointment within the meaning of the Companies act 2013. The Board ofDirectors recommend their re-appointment for the financial year 2015-16. Accordingly there-appointment of Walker Chandiok &. Co. LLP Chartered Accountants as statutoryauditors of the Company is placed for approval by the shareholders.

The Auditors’ Report for financial year 2015-2016 does not contain anyqualification reservation or adverse remark. The Auditors’ Report is enclosed withthe financial statements in this Annual Report.

Internal Audit:

Pursuant to section 138 of the Companies Act 2013 and rules made thereunder M/s.Lakshmi Niwas & Co. Chartered Accountants Hyderabad were appointed as InternalAuditors of the Company to conduct internal audit of the functions and activities of thecompany.

The Board has re-appointed M/s. Lakshmi Niwas & Co. Chartered AccountantsHyderabad as Internal Auditors for the Financial Year 2016-2017.

Secretarial auditor

Mr. S. Sarweswar Reddy & Co Practicing Company Secretary was appointed to conductthe secretarial audit of the Company for the financial year 2015-2016 as required underSection 204 of the Companies Act 2013 and Rules thereunder. The secretarial audit reportfor financial year 2015-2016 forms part of the Annual Report as Annexure 5 to theBoard’s report. After the sale of business the Company does not have any operatingbusiness yet and is still in the process of appointing right candidate as CFO.

The Board has re-appointed S. Sarweswar Reddy & Co Practicing Company Secretaryas secretarial auditor of the Company for financial year 2016-2017.

Auditors’ certificate on corporate governance

As required by SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 the auditors’ certificate on corporate governance is enclosed as Annexure 6 tothe Board’s report. The auditors’ certificate for financial year 2015-2016 doesnot contain any qualification reservation or adverse remark.

VI. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE OUTGO:

The required information as per Sec.134 (3) (m) of the Companies Act 2013 is providedhereunder and Rule 8 of Companies (Accounts) Rules 2014:

A. Conservation of Energy:

Your Company’s operations are not energy intensive. Adequate measures have beentaken to conserve energy wherever possible by using energy efficient computers andpurchase of energy efficient equipment.

B. Technology Absorption:

1. Research and Development (R&D): Nil

2. Technology absorption adoption and innovation: Nil

C. Foreign Exchange Earnings and Out Go:

1. Foreign Exchange Earnings: Nil

2. Foreign Exchange Outgo: Nil

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013.

The Company has in place an Anti Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of Women at workplace (Prevention Prohibition and Redressal)Act 2013. Internal Complaint Committee (ICC) has been set up to redress complaintsreceived regarding sexual harassment. All employees are covered under this policy.

The following is the summary of sexual harassment complaints received and disposedduring the calendar year.

No. of complaints received: Nil

No. of complaints disposed off: Nil

Industry Based Disclosures As Mandated By the Respective Laws Governing The Company

The Company is not a NBFC Housing Companies etc. and hence Industry based disclosuresis not required.

INSURANCE:

The properties and assets of your Company are adequately insured.

DISCLOSURE ABOUT COST AUDIT:

Cost Audit is not applicable to your Company.

ACKNOWLEDGEMENTS:

Your Directors place on record their appreciation for the overwhelming co-operation andassistance received from the investors customers business associates bankers vendorsas well as regulatory and governmental authorities. Your Directors also thanks theemployees at all levels who through their dedication co-operation support and smartwork have enabled the company to achieve a moderate growth and is determined to poise arapid and remarkable growth in the year to come.

Your Directors also wish to place on record their appreciation of businessconstituents banks and other financial institutions and shareholders of the Company likeSEBI BSE NSE NSDL CDSL ICICI Bank Kotak Mahindra Bank and State Bank of India etc.for their continued support for the growth of the Company.

For and on behalf of the Board
Palred Technologies Limited
Sd/-
Palem Srikanth Reddy
Chairman and
Place : Hyderabad Managing Director
Date : September 2 2016 (DIN: 00025889)

Annexures to the Board’s Report

Annexure 1- Statement Containing the salient features of the financial statements ofsubsidiaries (As on March 31 2016).

Form AOC-I

(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 ofCompanies (Accounts) Rules 2014)

(Rs. In Lakhs)

Sl. No. Name of the subsidiary Share capital Reserves & surplus Total assets Total Liabilities (Excluding Share Capital Reserves and Surplus) Invest- ments Turnover Profit before taxation Provision for taxation Profit after taxation % of share- holding
1 Palred Online Technologies Private Limited 2469.13* (1784.68) (3769.06) 3084.61 2468.51 3809.93 (168842) - (1687.28) 79%
2 Palred Technology Services Private Limited* 601.00 (98.19) 513.75 10.94 487.72 38.40 (88.32) - (88.31) 99.8%

 

Notes: 1. Names of subsidiaries which are yet to commence operations - Nil
2. Names of subsidiaries which have been liquidated or sold during the year-Nil
* The paid up Capital of the Company as on date of this Report is 2903.91 Lakhs

Annexure 2 - Particulars of contracts/arrangements entered into by the company withrelated parties.

Form No. AOC-2

(Pursuant to clause (h) of sub-section (3)of section 134 of the Act and Rule8(2) of the Companies (Accounts) Rules 2014)

This form pertains to disclosure of particulars of contracts/arrangements enteredinto by the company with related parties referred to in sub-section (1) of section 188 ofthe Companies Act 2013 including certain arms length transactions under third provisothereto:

1. Details of contracts or arrangements or transactions not at arm’s length basis– NIL

2. Details of material contracts or arrangement or transactions at arm’s lengthbasis

Name(s) of the related party Nature of relationship Duration of the contracts Salient terms Date(s) of approval by the Board if any: Amount
Investment in Equity
1. Palred Online Technologies Private Limited Subsidiary Company Refer Note 1 Refer Note 1 Refer Note 1 Rs. 30 Crores
2. Palred Technology Services Private Limited Subsidiary Company Refer Note 2 Refer Note 2 Refer Note 2 Rs. 5 crores
3. Palem Supriya Reddy Relative of Managing Director 5 years w.e.f 01.01.2014 Refer note 3 Refer note 3 Refer note 3

Notes:

1) The Board of Directors of Palred Technologies Limited have at the Board Meeting heldon July 29 2015 approved investment of Rs. 10 Crores in Palred Online TechnologiesLimited Private Limited at Rs. 11.5/- per share (Face Value Of Rs. 10/- per share at apremium of Rs. 1.50/- per Equity Share) . Further at the Board Meetings Held on October15 20153 February 17 2016 and EGM held on November 13 2015 the Company has decided toInvest Rs. 20 Crores. The same is reflected as Share Application Money pending allotmentas on 31.03.2016.

2) The Board of Directors of Palred Technologies Limited have at the Board Meeting heldon July 29 2015 approved investment of Rs. 5 Crores in Palred Technology Services Limitedat Rs. 10/- per share.

3) The Company has at the AGM held on 29.09.2014 approved Related Party Transactionwith Mrs. Palem Supriya Reddy for lease of office premises at Rs. 2 lacs Per Month for aperiod of 5 years commencing from 1st January 2014 and renewable for a further similarperiod by mutual consent.

By Order of the Board

For Palred Technologies Limited

Sd/-

Palem Srikanth Reddy

Chairman and Managing Director

Annexure 3 - Particulars of Employees

a) Information as per Rule 5(1) of Chapter XIII Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014.

During the financial year ended 31 March 2014 Company had transferred itstransportation and logistics software business and Board and the management of the Companyare presently evaluating multiple business options.

The nomination ad remuneration committee consists of 3 Independent Directors. Itreviews the remuneration of Chairman and Managing Director of the Company.

Remuneration paid to Whole Time Directors

Name of Director DIN Title Remuneration in Fiscal 2016 Remuneration in Fiscal 2015 % increase Ratio of the remuneration of director to the median remuneration of the employees of the company for the financial year 2015-2016; Percentage increase in the median remuneration of employees in the financial year
Palem Srikanth Reddy 00025889 Chairman and Managing Director 3000000 3000000 NIL 3:1 Nil

Remuneration Paid to Independent Directors in Financial Year 2015-2016 - Nil

The Independent Directors are entitle to sitting fees of Rs. 5000/- per Board Meetingfor attending Board Meetings.

Percentage increase in remuneration of each Director and Company Secretary in thefinancial year 2015-2016 – Nil

Percentage increase in the median remuneration of employees in the financial year2015-2016- Nil

None of the employees is drawing Rs. 850000/- and above per month or Rs.10200000/-and above in aggregate per annum the limits prescribed under Section 134 of the CompaniesAct 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014.

By Order of the Board

For Palred Technologies Limited

Sd/-

Palem Srikanth Reddy

Chairman and Managing Director