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S R G Securities Finance Ltd.

BSE: 536710 Sector: Financials
NSE: N.A. ISIN Code: INE326P01019
BSE LIVE 11:49 | 23 Aug Stock Is Not Traded.
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OPEN 17.00
PREVIOUS CLOSE 21.15
VOLUME 24000
52-Week high 21.15
52-Week low 16.00
P/E 17.35
Mkt Cap.(Rs cr) 7
Buy Price 17.00
Buy Qty 6000.00
Sell Price 0.00
Sell Qty 0.00
OPEN 17.00
CLOSE 21.15
VOLUME 24000
52-Week high 21.15
52-Week low 16.00
P/E 17.35
Mkt Cap.(Rs cr) 7
Buy Price 17.00
Buy Qty 6000.00
Sell Price 0.00
Sell Qty 0.00

S R G Securities Finance Ltd. (SRGSECURITIES) - Director Report

Company director report

To

The Members

The Directors have pleasure in presenting before you the Annual Report of the Companytogether with the Audited Statements of Accounts for the year ended 31st March2016.

FINANCIAL SUMMARY/HIGHLIGHTS OPERATIONS & STATE OF AFFAIRS:

(Rs. In Lakhs)

Particulars

2015-16

2014-15

Gross Income 197.34 164.08
Less: Finance Cost 54.01 39.68
Overheads 92.71 84.23
Depreciation 12.70 6.04
Profit before Tax & Exceptional Items 37.92 34.13
Add : Exceptional Items 0.00 0.00
Profit before Tax 37.92 34.13
Less : Provision for taxation 13.50 11.24
Profit after tax 24.42 22.89
Deferred Tax Assets 1.77 0.70
Add : Balance b/d from the previous year 36.57 18.78
Excess provision for Income Tax 0.19 0
Surplus available for appropriations 62.95 42.37
Appropriations
Transferred to Special Reserve 5.25 4.75
Provision for standard Assets 0.63 0.28
Provision for NPA 2.47 0.60
Assets W/o as per Co. Act 2013 0.00 0.14
Excess Provision for Income Tax 0.00 0.03
Balance carried over to Balance Sheet 54.60 36.57

LENDING OPERATIONS & DISBURSEMENT OF LOANS:

Your Company registered a remarkable growth in its operations. The highlights ofCompany’s Performance are as follows:

• The operating profit before charging depreciation and tax amounted to Rs 50.62lakhs in the year 2015-16 as against Rs. 40.17 lakhs in the preceding year; representing arise of 26.01%.

• Profit after Tax (PAT) before extraordinary items went up by 11.07% to Rs. 26.19lakhs in the year 2015-16 from Rs.23.58 lakhs in the previous year.

• As at 31st March 2016 the loan portfolio stood at Rs. 1143.18 lakhsas against Rs. 890.91 lakhs in the previous year an increase of 28.32%.

• Disbursements during the year amounted to Rs. 5.12 Crores in 2015-16.

As part of its liability management your Company endeavors to diversify its resourcebase in order to achieve an appropriate maturity structure and minimize the weightedaverage cost of borrowed funds. During the year under review financial assistance of Rs.9.00 Crores was sanctioned from State Bank of India.

DIVIDEND:

Your Directors felt it prudent to retain the earnings for the year under review to beploughed back in business which shall result in further augmentation of theCompany’s growth and shareholders’ wealth.

CHANGES IN SHARE CAPITAL:

During the year under review there were no changes in the share capital of theCompany.

UNCLAIMED DIVIDEND:

Under the provisions of section 125 of Companies Act 2013 dividends that remainunclaimed for a period of seven years from the date of declaration are required to betransferred to the Investor Education and Protection Fund (IEPF) administered by theCentral Government. As at March 31st 2016 there are no unpaid/ UnclaimedDividend to be transferred to Investor Education and Protection Fund.

MANAGEMENT DISCUSSION AND ANALYSIS:

Pursuant to SEBI (LODR) Regulations 2015Report on Management Discussion and Analysisis annexed herewith in Annexure IV.

SUBSIDIARY COMPANIES:

The Company does not have any subsidiary.

DIRECTOR’S RESPONSIBILITY STATEMENT:

In pursuance of section 134 (3) (c) of the Companies Act 2013 and based on theinformation provided by the management your Directors hereby confirm that:

(a) In the preparation of the annual accounts the applicable accounting standards hadbeen followed;

(b) Accounting policies selected were applied consistently. Reasonable and prudentjudgments and estimates were made so as to give a true and fair view of the state ofaffairs of the Company as at March 31st 2016 and of the profit of the Companyfor the year ended on that date;

(c) Proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting frauds and otherirregularities;

(d) The annual accounts of the Company have been prepared on a going concern basis.

(e) Internal controls have been laid down to be followed by the Company and suchinternal controls were adequate and were operating effectively.

(f) Systems to ensure compliance with the provisions of all applicable laws were inplace and were adequate and operating effectively.

CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION:

Your Company has taken adequate steps to adhere to all the stipulations laid down inSEBI (LODR) Regulations 2015. A report on Corporate Governance is included as a part ofthis Annual Report in ANNEXURE VI.

Certificate from the Statutory Auditors of the company confirming the compliance withthe conditions of Corporate Governance as stipulated under SEBI (LODR) Regulations 2015is attached to this report.

In terms of Section 136 of the Act the reports and accounts are being sent to themembers and others entitled thereto.

RELATED PARTY TRANSACTIONS:

All contracts / arrangements / transactions entered by the Company during the financialyear with related parties were in the ordinary course of business and on an arm’slength basis. During the year the Company had not entered into any contract / arrangement/ transaction with related parties which could be considered material in accordance withthe policy of the Company on materiality of related party transactions.

The Policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed on the Company’s website at thelink (http://srgfin.com/BestPracticesSub/26/Policy%20on% 20Related%20Party).

Your Directors draw attention of the members to Note 20 to the financial statementwhich sets out related party disclosures

RISK MANAGEMENT POLICY:

Pursuant to section 134 (3) (n) of the Companies Act 2013 & SEBI (LODR)Regulations 2015 the company has in place a risk management framework approved by theboard of Directors. SRGSFL’s Risk Management framework provides the mechanism forrisk assessment and mitigation. Company has in place Risk Management Committee. Thedetails of the committee and its terms of reference are set out in the corporategovernance report forming part of the Boards report.

At present the company has not identified any element of risk which may threaten theexistence of the company.

CORPORATE SOCIAL RESPONSIBILTY POLICY:

Pursuant to the provisions of section 135 and schedule VII of the Companies Act 2013at present the CSR provisions are not applicable to the Company.

DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS:

The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit function isdefined by board. To maintain its objectivity and independence the Internal Auditorreports to the Chairman of the Audit Committee of the Board and/or to the ManagingDirector.

The Internal Auditor monitors and evaluates the efficacy and adequacy of internalcontrol system in the Company its compliance with operating systems accountingprocedures and policies of the Company.

Based on the report of internal auditor respective heads undertake corrective actionin their respective areas and thereby strengthen the controls. Significant auditobservations and recommendations along with corrective actions thereon are presented tothe Audit Committee of the Board and/or to the Managing Director.

DIRECTORS:

In accordance with the provisions of the Act and the Articles of Association of theCompany Mr. Rajesh Jain Director is liable to retire by rotation at the ensuing AnnualGeneral Meeting and being eligible offers himself for re appointment.

The term of appointment of Mr. Vinod K. Jain Managing Director expires on 23.06.2016and therefore Board of Director have in their meeting held on 16.05.2016 re–appointed Mr. Vinod K. Jain as Managing Director on such terms and conditions as decidedby Board in consultation with Nomination & Remuneration Committee and Audit Committeeand subject to the approval of members in the general meeting.

Necessary Resolutions for the re-appointment of the aforesaid directors have beenincluded in the notice convening the ensuing AGM and details of the proposal forre-appointment are mentioned in the explanatory statement of the notice. Your Directorsrecommend their appointment/ re-appointment.

All the directors of the Company have confirmed that they are not disqualified frombeing appointed as directors in terms of Section 164 of the Companies Act 2013.

There was no change in Key Managerial Personnel during the year.

DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS:

The Company has received necessary declaration from each Independent Director of theCompany under Section 149(7) of the Companies Act 2013 that the Independent Directors ofthe Company meet with the criteria of their Independence as laid down in Section 149(6).

AUDITORS:

Statutory Auditors:

At the 19TH Annual General Meeting held on September 18th 2014the members had re-appointed M/s Valawat Jha Pamecha & Co. Chartered Accountants(registration No. 008265 C) as the statutory auditors of the Company for a period of 3years upto the conclusion of 22nd Annual General Meeting to be held in the year2017 subject to them ratifying the said appointment at every AGM. The Company hasreceived a confirmation from M/s Valawat Jha Pamecha & Co. Chartered Accountants tothe effect that their appointment if made at the ensuing AGM would be in terms ofSections 139 and 141 of the Companies Act 2013 and rules made there under. The boardproposes to the members to ratify the said appointment of M/s Valawat Jha Pamecha &Co. Chartered Accountants.

Secretarial Auditors:

M/s Deepak Vijaywargey & Associates Practicing Company Secretary Udaipur wasappointed as the Secretarial Auditor of the Company for the financial year 2015-16 by theBoard of Directors pursuant to provisions of Companies Act 2013 and rules there under.Secretarial audit report as provided by M/s Deepak Vijaywargey & AssociatesPracticing Company Secretary is annexed to this Report as ANNEXURE II.

QUALIFICATIONS IN AUDIT REPORTS:

There are no qualifications reservations or adverse remarks or disclaimer made—(a) By the statutory auditor in his report; and (b) By the company secretary in practicein his secretarial audit report;

DISCLOSURES:

BOARD MEETINGS:

The Board of Directors met 11 (Eleven) times during this financial year 2015-16.

COMPOSITION OF AUDIT COMMITTEE:

The Audit Committee consists of adequate composition of Executive and Non- ExecutiveIndependent Directors. The details of which are mentioned in the Corporate GovernanceReport.

COMPOSITION OF NOMINATION & REMUNERATION COMMITTEE:

The Nomination & Remuneration Committee consists of adequate composition of Non-Executive Independent Directors. The details of which are mentioned in the CorporateGovernance Report.

COMPOSITION OF STAKEHOLDER’S RELATIONSHIP COMMITTEE:

The Stakeholder’s Relationship Committee consist of adequate composition of Non-Executive and Independent Directors. The details of which are mentioned in the CorporateGovernance Report.

PARTICULARS OF LOANS GAURANTEES OR INVESTMENTS:

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 if any apart from the loans made guarantee given orsecurity provided by the Company in the ordinary course of business if any are given inthe Notes to accounts forming part of the Audited Financial Statements for the year endedMarch 31 2016.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE OUTGO:

(A) Conservation of energy:

The Company’s operations are not power intensive. Nevertheless your Company istaking every step to conserve and minimize the use of energy wherever possible such asusing energy efficient computer terminals purchasing energy efficient equipments etc.

(B) Technology absorption:

The Company has imported no technology. Indigenous technology available is continuouslyupgraded to improve overall performance.

(C) Expenditure incurred on research and development:

The Company has no formal research and development department but the Company iscontinuously making efforts to strengthen research and development activities to improvequality and reduce cost.

(D) Foreign exchange earnings and Outgo:

During the year under review there was no earnings and outgo in foreign exchange.

EXTRACT OF ANNUAL RETURN:

As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 the details forming part of extractof annual return in MGT 9 is annexed herewith as ANNEXURE III.

PARTICULARS OF EMPLOYEES:

In accordance with the provisions of Section 197 of the Companies Act 2013 read withthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 asamended as at March 31st 2016 there were no employees in SRGSFL throughoutthe year who were in receipt of remuneration of Rs. 60 lacs or more per annum or Rs. 5Lacs or more if appointed for the part of the financial year.

EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS:

There are no material changes and commitments affecting financial position of thecompany between 31st March and the date of Board’s Report.

CHANGE IN THE NATURE OF BUSINESS:

There are no changes in the Nature of Business.

DETAILS RELATING TO DEPOSITS:

Your Company has not accepted any deposits from the public during the year under review.The Company has been granted registration by the Reserve Bank of India as a non-deposittaking NBFC. Being so the Company has neither accepted in the past nor has any futureplans to accept any public deposits.

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS:

The Company has been following directions guidelines circulars issued by SEBI BSEMCA RBI etc. from time to time relating to companies and that there are no significant& material orders passed by these regulators so far.

DISCLOSURES ON MANAGERIAL REMUNERATION:

Details of Managerial remuneration as required under Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is given as per"Annexure VIII" to this report.

LISTING WITH STOCK EXCHANGES:

The Company confirms that it has paid the Annual Listing Fees for the year 2016-17 toBSE SME where the Company’s Shares are listed.

INVESTOR COMPLAINTS AND COMPLIANCE:

During the year company has not received any investor complaints and that as on date nocomplaints are pending.

EARNINGS PER SHARE (EPS):

The Earnings Per Share (EPS) is 0.68 as at March 31st 2016 as against 0.61as at March 31st 2015.

CAPITAL ADEQUACY:

Particulars as on 31st March

2016

2015

Capital Adequacy Ratio 53.49% 72.51%

Your Company’s capital adequacy ratio was at 53.49% as on 31st March2016 which we believe provides an adequate cushion to withstand business risks and isabove the minimum requirement of 15% stipulated by the RBI.

NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY:

Your Company adhered to the prudential guidelines for Non performing Assets (NPAs)issued by Reserve Bank of India as amended from time to time. As per the prudentialnorms the income on such NPAs is not to be recognised if unrealized.

As per the prudential norms prescribed by the Reserve Bank of India the Company hasmade provision for contingencies on standard as well as non-performing assets.

A NOTE OF APPRECIATION:

Your Directors place on record their appreciation for the advice guidance and supportgiven by various regulatory authorities including the RBI SEBI MCA the Stock Exchange(BSE) Depositories and all the bankers of the Company including State Bank of India . TheDirectors would also like to acknowledge the role of all its stakeholders –shareholders borrowers key partners and lenders for their continuing support to theCompany. Your Directors also record their appreciation for the dedicated services of theemployees and their contribution to the growth of the Company. The Board would also liketo express its sincere appreciation to all the Company’s valued Shareholders RTAService Providers and Counselors for their continued support and patronage.

Best Wishes
Sd/- Sd/-
Vinod K. Jain Rajesh Jain
Managing Director Director
DIN: 00248843 DIN: 00212393
Date : 16.05.2016
Place: Udaipur