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Roselabs Finance Ltd.

BSE: 531324 Sector: Financials
NSE: N.A. ISIN Code: INE475C01012
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VOLUME 1050
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P/E
Mkt Cap.(Rs cr) 23
Buy Price 20.70
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Sell Price 0.00
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OPEN 20.45
CLOSE 21.50
VOLUME 1050
52-Week high 59.00
52-Week low 20.45
P/E
Mkt Cap.(Rs cr) 23
Buy Price 20.70
Buy Qty 10.00
Sell Price 0.00
Sell Qty 0.00

Roselabs Finance Ltd. (ROSELABSFIN) - Director Report

Company director report

Dear Shareholders

The Directors have pleasure in presenting the 21st Annual Report along withthe Audited Accounts of the Company for the financial year ended 31 st March2015.

FINANCIAL RESULTS & OVERVIEW

Particulars 31stMarch 2015 31st March 2014
(Rs. in Lakh) (Rs. in Lakh)
Total Income 1355.98 9329.18
Less : Total Expenses 1306.86 9690.88
Profit/Loss Before Tax 49.12 (361.70)
Less: Tax Expenses (Deferred tax) - 0.23
Less: Prior period taxation adjustments - (0.98)
Profit /Loss for the Year 49.12 (362.45)

Total Revenue: Total income declined by 85.47% to Rs. 1355.98 lakh for thefinancial year 2015 from Rs. 9329.18 lakh for the financial year 2014.

Total Expenditure: . Total expenses declined by 85.51% to Rs. 1306.86 lakh for thefinancial year 2015 from Rs. 9690.88 lakh for the financial year 2014.

Profits:

Profit Before Tax (PBT) increased by 113.58% to Rs. 49.12 lakh in the financial year2015. PBT Margin improved to 3.62 % of income in financial year 2015 as compared to lossin financial year 2014.

Net Profit of the Company increased by 113.55% to Rs 49.12 lakh for the financial year2015.

During the year under review the Company has earned major part of its income fromproviding Advisory services.

Reserves

Out of the profit available for appropriation an amount of Rs. 9.82 lakh has beentransferred to Statutory Reserve and the balance has been carried forward to Profit &Loss Statement.

Dividend

In view of losses of the earlier years the Directors do not recommend payment ofdividend on Equity Shares for the Financial Year ended March 31 2015.

Details of Board meetings

The details of composition of the Board of Directors as on 31st March 2015is as under:

Name of Directors Designation
Mr. Santosh Kumar Ojha Chairman-Independent Director
Mr. Nilesh Rawat Managing Director
Mr. Prakash Bhat Independent Director
Ms. Purnima Pavle Non-Executive Non-Independent Director

During the year the Company has conducted Eight (8) Board meetings.

Committees of Board

The details of composition of the Committees of the Board of Directors as on 31stMarch 2015 are as under:-a. Audit Committee

Sl. No. Name Chairman/ Members
1 Mr. Santosh Kumar Ojha Chairman
2 Mr. Prakash Bhat Member
3 Ms. Purnima Pavle Member

b. Nomination & Remuneration Committee

Sl. No. Name Chairman/ Members
1 Ms. Purnima Pavle Chairperson
2 Mr. Prakash Bhat Member
3 Mr. Santoshkumar Ojha Member

During the year Company has conducted Two (2) Nomination & Remuneration CommitteeMeetings. c. Stakeholders Relationship Committee

Sl. No. Name Chairman/ Members
1 Ms. Purnima Pavle Chairperson
2 Mr. Santoshkumar Ojha Member
3 Mr. Prakash Bhat Member

During the year the Company has conducted Four (4) Stakeholders Relationship CommitteeMeetings.

Vigil mechanism

In line with the provisions of section 177 of the Companies Act 2013 the Company hasformed a Transparency and Ethics policy (TEP) to deal with instances of fraud andmismanagement if any and to ensure a clean and transparent environment for conductingbusiness.

The TEP policy ensures that strict confidentialityis maintained whilst dealing withconcerns and also that no discrimination will be shown towards any person for a genuinelyraised concern. Any employee can report such incident of violation and context thereto tothe Ombudsman or director concerned in writing/by email/sms or by phone. Alternativelythe Ethics Helpline can be contacted to report any suspected or confirmed incident offraud / misconduct. It provides for adequate safeguards against victimization of personswho use such mechanism and provides direct access to chairperson of Audit Committee. TheTEP policy has also been placed on the website of the Company.

Extract of Annual Return

Pursuant to section 92(3) of the Companies Act 2013 (‘the Act’) and rule12(1) of the Companies (Management and Administration) Rules 2014 extract of annualreturn is Annexed as Annexure 1.

Statutory Auditors their Report and Notes to Financial Statements

Pursuant to the provisions of Section 139 of the Act and the rules framed thereunderM/s Shanker and Kapani Chartered Accountants were appointed as statutory auditors of theCompany from the conclusion of the Annual General Meeting (AGM) of the Company held on 15thSeptember 2014 till the conclusion of the AGM to be held in the year 2019 subject toratification of their appointment at every AGM to be held thereafter.

Shanker and Kapani CharteredThe Company has received Accountant Certificateconfirming their eligibility.

Accordingly the appointment of M/s Shanker and Kapani Chartered Accountants as theStatutory Auditors is placed for ratification by the shareholders at the Annual GeneralMeeting.

The report of the Statutory Auditors is enclosed to this report. The Auditor’sReport does not does not contain any qualification reservation or adverse remarks. Theobservations made in the Auditors’ Report are self-explanatory and therefore do notcall for any further comments.

Secretarial audit

During the year under review in terms of Section 204 of the Companies Act 2013 andRules made there under Ms. Jinal Dawda Practicing Company Secretary had been appointedto conduct the Secretarial Audit of the Company. The report of the Secretarial Auditors isenclosed as Annexure 2 to this report. The report is self-explanatory and do notcall for any further comments.

Related party transactions

During the year under review the Company has entered into contract / arrangements withthe related parties in the ordinary course of business and on arm’s length basis.During the year the Company had not entered into any contract / arrangement / transactionwith related parties which could be considered material . Thus the disclosures pertainingto Section 188(1) of the Companies Act 2013 are not applicable.

Information on Material Changes and Commitments

There are no material changes or commitment affecting the financial position of theCompany which have occurred between

March 31 2015 and the date of this Report.

Risk Management Policy

Risk is regarded as the threat of some event action or loss of opportunity if itoccurs will adversely affect the business i.e. value to stakeholders ability to achieveobjective ability to implement business strategies manner of operation reputation &Brand

Image due to Internal and external factors. The Company has a Risk Management Policywhich lays down active process for identification and mitigation of risks. Risk ManagementPolicy has been adopted by the Board of Directors of the Company. All concerned processowners of the company are regularly identifying & mitigating key risks in theirrespective domain. The Board reviews the risk management and mitigation plan for key risksfrom time to time.

The Company’s internal control systems are commensurate with the nature of itsbusiness and the size and complexity of its operations. These are routinely tested andverified by Internal Auditors. Appropriate actions are being taken by the responsibleconcerned.

Company’s policy on director’s appointment and remuneration includingcriteria

The Nomination and Remuneration Committee and the Board of Directors at its Meetingheld on 20th October 2014 had laid down criteria for determiningdirector’s qualification positive attributes and independence of director’sremuneration of directors and key managerial personnel and also criteria for evaluation ofperformance of directors chairperson non-executive directors and Board as a whole andalso the evaluation process of the same. Criteria for Performance Evaluation of ExecutiveDirectors of the Company who are involved in day to day operations of the Company isassessed on the basis of Key Performance Indicators (KPI) which would be identified basedon a) their commitment to achieve Company’s goals and alignment with the strategicdirection b) their decision making ability and c) their ability and actions to safeguardthe interest of shareholders of the Company and weights assigned for each measure ofperformance keeping in view the distinct roles of each Executive Director. Performance ofNon-Executive and Independent Directors of the Company who are not involved in day to dayoperations of the Company is assessed on the basis of: a) individual’s continuingcommitment to the role strategic thinking b) commitment of time for Board the otherCommittee meetings c) individual’s continuing commitment to spend time and effortlearning about the Company and its business.

The performance of the members of the Board and the Board as a whole were evaluated atthe meeting of Independent Directors held on 20th March 2015.

As per Section 149 of the Companies Act 2013 a Company shall have at least One WomenDirector on the Board of the Company. The Company has Ms. Purnima Pavle as Director on theBoard since 11th October 2013.

The Company has devised a Policy for which includes criteria for performance evaluationof the non-executive directors and executive directors.

The policy on Directors appointment and remuneration for Directors Key ManagerialPersonnel Senior Management Personnel including policy for performance evaluation ofIndependent Directors Board Committees and other individual Directors is attached as Annexure3.

Significant and material orders passed by the regulators

During the year under review the Company had received a notice under SEBI (Prohibitionof fraudulent and unfair trade Practices Relating to Securities market) Regulation 2003SEBI (Substantial Acquisition of shares and takeover) Regulations 1997 and SEBI(Prohibition of Insider Trading) Regulation 1997 for violation of the SEBI Guidelines asmentioned in the Order and under which SEBI has imposed a penalty amounting Rs. 253.72lakh. The directors want to clarify that the violation of the SEBI Guidelines as mentionedin the Order pertains to the year prior to the acquisition of the Company by the presentpromoter i.e. Arihant Premises Private Limited (‘Arihant’).

The Company was initially managed by Singhal Group of Companies which was taken over byPoonam Fast Foods Private Limited in the year 2008. In the year 2013 Arihant byproviding open offer in accordance with provisions of SEBI Takeover Regulations 2011acquired the controlling stake of the Company. At present Arihant holds 74.25% of thevoting Equity Share Capital of the Company.

Your Directors further state that the said default as mentioned in the Order has notbeen committed by Arihant as the violation pertains to the period from October 6 2003 toJanuary 28 2004 wherein the Company was not managed by Arihant.

The Company has filed an appeal before Securities Appellate Tribunal (SAT) Challengingthe aforesaid order hearing for which has not yet commenced.

Internal financial controls

The internal financial controls with reference to the Financial Statements arecommensurate with the size and nature of its business.

Holding and Subsidiary

The Promoter of the Company i.e. Arihant Premises Private Limited holds 7424670equity shares which represents 74.25 percent of the paid-up equity capital of the Company.Your Company continues to be a subsidiary company of Arihant Premises Private Limitedpart of Lodha Group.

During the year under review the Company did not have any subsidiary joint venturesor associate companies.

Directors and Key Managerial Personnel

In terms of the provisions of Section 149 of the Companies Act 2013 the Board ofDirectors at its meeting held on 12th August 2014 had appointed Mr. Prakash Bhat (DIN No:00654992) and Mr. Santosh Kumar Ojha (DIN No 02494357) as Independent Director for a termof 5 years which was approved by the Members of the Company at the AGM held on 15thSeptember 2015 to hold office up to September 14 2019.

The Company has received declarations from the Independent Directors viz. Mr. PrakashBhat (DIN No: 00654992) and Mr. Santosh Kumar Ojha (DIN No 02494357) stating that theymeet the criteria of independence as provided in Section 149(6) of the Act.

Mr. Nilesh Rawat (DIN No: 06705140) Managing Director Mr. Kunti Prakash Inani CFOand Mr. Mahesh Bhatt Company Secretary are the Key Managerial Personnel as per theprovisions of the Companies Act 2013 of which Mr. Nilesh Rawat DIN No: 06705140)Managing Director and Mr. Kunti Prakash Inani CFO were acting in the said capacitybefore the commencement of the Companies Act 2013.

Mr. Hemanshu Mumbaiwala was the Company Secretary of the Company till 6th May 2014and Mr. Sanjay Gupta was the Company Secretary from 7th May 2014 to 13thOctober 2014 and were also Key Managerial Personnel’s as per the provisions of theCompanies Act 2013.

During the year Mr. Mahesh Bhatt was appointed as a Company Secretary of the Companyw.e.f. 29th January 2015 as per the provisions of Companies Act 2013.

Ms. Purnima Pavle (DIN No: 06705133) Director retires by rotation at the ensuingAnnual General Meeting and is eligible for re-appointment.

Fixed Deposits

Your company has neither invited nor accepted or renewed any deposit from the publicand/or member under the provisions of

Companies Act 2013 or rules made thereunder during the financial year under review.

Particulars of Loans Guarantees or Investments

The provisions of Section 186 of the Act pertaining to investment and lendingactivities is not applicable to the Company since the Company is an NBFC.

During the year under review the Company has not provided any guarantees and /orsecurities in connection with loans to other bodies corporate or person covered underSection 186 of the Companies Act 2013.

Particulars of Employees

Pursuant to Section 197(12) of the Companies Act 2013 read with Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 the statement of particulars ofemployees is annexed as Annexure 4.

Details of conservation of energy technology absorption foreign exchange earnings andoutgo (a) Conservation of energy

(i) the steps taken or impact on conservation of energy The operations of your Companyare not energy-intensive.

(ii) the steps taken by the company for utilizing alternate sources of energy None

(iii) the capital investment on energy conservation equipments Nil

(b) Technology absorption

(i) the efforts made towards technology absorption None
(ii) the benefits derived like product improvement cost reduction product development or import substitution None
(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)- None
(a) the details of technology imported
(b) the year of import;
(c) whether the technology been fully absorbed
(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof
(iv) the expenditure incurred on Research and Development None

(c) Foreign exchange earnings and Outgo

The foreign exchange earned in terms of actual inflows during the year and the foreignoutgo during the year in terms of actual outflows .

During the year ended 31st March 2015 the Company earned Rs. 12 crores anddid not spent any expenditure in foreign currency.

Directors’ Responsibility Statement

Pursuant to the requirement clause (c) of sub-section (3) of Section 134 of theCompanies Act 2013 your Directors confirm that:

(a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed and there are no material departures thereof;

(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 ended on31st March 2015 and of the 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; and

(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; (f) the directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

Corporate Governance and Management Discussion and Analysis Report

As per clause 1(a) of SEBI Circular CIR/CFD/POLICY CELL/7/2014 dated 15thSeptember 2014 compliance of the provisions of the Clause 49 of the Listing Agreementshall not be mandatory to a Company having its paid up equity share capital not exceedingRs. 10 crore and Net Worth not exceeding Rs. 25 crore as on last day of the previousfinancial year.

Since the paid up Equity Share capital and Networth of the Company was not exceedingRs. 10 crores and Rs. 25 crores respectively the Company was not required to comply withthe requirement of Clause 49 of the Listing Agreement and hence a report on CorporateGovernance and Management Discussion Analysis does not form part of this Report.

Acknowledgement

Your Directors would like to acknowledge and place on record their sincere appreciationto all stakeholders Banks and Company’s valued investors and all other businesspartners for their continued co-operation during the year.

By Order of the Board
For Roselabs Finance Limited
Nilesh Rawat Purnima Pavle
Managing Director Director
DIN: 06705140 DIN: 06705133
Registered Office
416 Anand Mangal Complex B/H Omkar House
C.G. Road Navrangpura Ahmedabad – 380009
Tel No: +91.22. 23024400 Fax: +91.22.23024550
Website: www.roselabsfinancelimited.in
CIN No: L67120GJ1995PLC024070
Email: roselabsfinance@lodhagroup.com
Place: Mumbai
Date: 28th August 2015