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S.V. Trading & Agencies Ltd.

BSE: 503622 Sector: Others
NSE: N.A. ISIN Code: INE404N01019
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S.V. Trading & Agencies Ltd. (SVTRADAGEN) - Director Report

Company director report

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MANAGEMENT DISCUSSION &ANALYSIS

Dear Members

S V TRADING AND AGENCIES LIMITED

The Directors are pleased to present the 36thAnnual Report together with theAudited Financial Statements for the financial year ended March 31 2016. The ManagementDiscussion and Analysis is also included in this Report.

1. FINANCIAL PERFORMANCE

The brief financial results of the Company are as detailed below:

[In Rs.]

Particulars Year ended 31st March 2016 Year ended 31st March 2015
Revenue from operation 11828042 15366062
Profit/(Loss) before taxation (42321) 6083686
Less: Tax Expense - 1164359
Profit/(Loss) after tax (42321) 4919327

2. OPERATION AND STATE OF THE AFFAIRS OF THE COMPANY

During the financial year ended on March 31 2016 your Company reported a negativegrowth in revenue from operation over the previous year. The revenue from operations stoodat Rs. 1.18 crores as compared with Rs. 1.54crores in the previous year. During thefinancial year ended on March 31 2016 the Company earned revenue of Rs. 10.75 lacs fromtreasury operation as compared to Rs. 71.70 lacs in the previous year.

The loss before tax stood at Rs.0.42lacsas against profit of Rs. 60.8lacs in theprevious year. The net loss for the year stood at Rs. 0.42 lacs against profit of Rs. 49lacs reported in the previous year.

Due to lower income from other sources during the financial year ended on March 312016 as compared to previous financial year the company has incurred losses as the fundshave been in the business operation of the Company which result of which would bereflected in the coming years.

At present your Company is doing its existing line business to the optimum use of itsresources and is taking the effort to improve its Earning per Share (EPS) and managementhas no plan of venturing into any new business.

3. CORPORATE OVERVIEW

During the year the company is in the business of general trading. There is no changein nature of the business of the Company. The Company has its registered office at Mumbai.

4. OVERVIEW OF THE ECONOMY AND ANALYSIS

As per the latest GDP growth estimates Indian economy grew by 7.9% in FY 16 comparedto 7.4% in FY15 mostly driven by improved economic fundamentals and revision of GDPmethodology calculation. Even inflation showed signs of moderation a welcome sign -wholesale price and consumer price inflation declined. Reduced inflation falling crudeoil prices stable Rupee improved purchasing power and consumer spending higher capitalinflows supported by the government policy reforms have already put India on anaccelerating growth track an improved the business outlook.

Reforms like e-auctions of coalmines and telecom FDI hike in insurance speedierregulatory approvals etc. will be critical growth enablers to de-bottleneck stalledprojects improve the investment outlook and the ease of doing business in the country.Reforms currently underway such as GST implementation Amendment on Land Acquisition BillLabour Reforms etc. are expected to provide the requisite thrust for growth in themedium-term.

Opportunities and Challenges

Being a major employer in India coupled with strong industry linkages with the ruraleconomy augurs trading activities as one of the most significant sectors with anincremental growth potential. Rural economy has seen a spurt in income levels the last fewyears and this is the right time to promote trade and investment. Being one of the keyfocus sectors under the Government's ''Make in India'' campaign is a testimony to the hugegrowth potential the trading and investment activities. Globally favourable trade policyreforms would also allow the trade and investment to expand its trade partners improveits export competitiveness and contribute substantially to the nation's income.

However the trading and investment are constrained with many challenges includingrising costs (wages inventory and interest costs)intensified competition from other lowcostcountries and political risk to implement the reforms like GST etc. Such issues needto be addressed to result in unlocking maximum growth potential.

5. DIVIDEND AND RESERVES

In view of the losses incurred during the financial year Your Directors do notrecommend any dividend for the financial year ended on March 31 2016.

6. SHARE CAPITAL

The paid up equity share capital as at March 31 2016 stood at 171000000 (RupeesSeventeen crores ten lacs). There is no change in the share capital of the company duringthe financial year.

7. SUBSIDAIRY AND ASSOCIATES COMPANIES

As on March 31 2016 the Company had the following Subsidiaries:

1. Dhinak Mercantile Private Limited

2. Deetya Tradex Private Limited

All of them are presently unlisted. The Company did not have any associate or jointventures company as on March 31 2016

Both the subsidiaries did not carry out any business activity during the financial yearended on March 31 2016.

Pursuant to Section 129(3) of the Companies Act 2013 read with rule 5 of the Companies(Accounts) Rules 2014 the statement containing the salient features of the financialstatements if the Company’s subsidiaries(in form AOC-1) is forming the part of theconsolidated financial statements.

8. CONSOLIDATED FINANCIAL STATEMENT

In compliance with Section 129(3) of the Companies Act 2013 and Rules made thereunderAccounting Standards 21 23 and 27 of Companies (Accounting Standards) Rules 2006 SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the ConsolidatedFinancial Statements form part of this Annual Report.

Consolidated Financial Statements presented by your Company include financialinformation about its aforesaid subsidiaries. The standalone financial statements of SVTrading and Agencies Limited as well as its aforesaid subsidiaries will be available onthe website of the Company (www.www.svtrading.co.in).

9. CORPORATE GOVERNANCE

A Report on Corporate Governance as required in terms of the provisions of Schedule Vof the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 togetherwith the Auditor’s Certificate thereon is annexed herewith.

10. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT-9 as requiredunder Section 92 of the Companies Act 2013 is annexed herewith as Annexure - A and formsan integral part of this report.

11. DIRECTORS AND KEY MANAGERIAL PERSONNEL

In terms of the provision of section 152 of the Companies Act 2013 and of Articles ofAssociation of the Company Ms. Jyotsna Joshi Director of the Company retires by rotationat the ensuing Annual General Meeting and being eligible seeks re-appointment.

All Independent Directors had furnished to the Company a declaration under Section149(7) of the Companies Act 2013 stating that they meet criteria of Independence asprovided under section 149(6) of the Companies Act 2013 and SEBI Listing Regulations.

12. BOARD EVALUATION INDUCTION AND TRAINING OF BOARD MEMBERS

Pursuant to the provisions of the Companies Act 2013 the Board has carried out anannual performance evaluation of its own performance the Directors individually as wellas evaluation of the working of the Board and its Committees culture execution andperformance of specific duties obligations and governance.

The performance evaluation of the Independent Directors was completed. The performanceevaluation of the Non-independent Directors was carried out by the Independent Directors.The Board of Directors expressed their satisfaction with the evaluation process.

The process followed by the Company for induction and training to Board members hasbeen explained in the Corporate Governance Report.

13. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY COMPANY

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to financial statements.

14. WHISTLE BLOWER POLICY

The Company has a whistle blower policy to report genuine concerns or grievances. TheWhistle Blower policy has been posted on the website of the Company.(www.svtrading.co.in)

15. REMUNERATION AND NOMINATION POLICY

The Board of Directors has framed a policy which lays down a framework in relation toremuneration of Directors Key Managerial Personnel and Senior Management of the Company.This policy also lays down criteria for selection and appointment of Board Members. Theremuneration and nomination policy has been posted on the website of the Company(www.svtrading.co.in).

16. RELATED PARTY TRANSACTIONS AND POLICY

The Company has developed a related party transactions framework through standardoperating procedures for the purpose of identification and monitoring of transactions withthe related parties.

The policy on related party transactions as approved by the Board of Directors has beenuploaded on the website of the Company. None of the Directors has any pecuniaryrelationship or transactions vis-d-vis the Company.

The details of transactions entered into with the related parties are givenhere-in-below in form AOC-2 in terms of the provision of section 188(1) including certainarm’s length transactions: A. Details of contract or arrangement or transactions notat arms’ length basis; Nil

a. Name(s) of the related party and nature of relationship NA
b. Nature of contract /arrangements/transaction NA
c. Duration of contract /arrangements/transaction NA
d. Salient terms of contract /arrangements/transaction including the value if any NA
e. Justification for entering into such contract / arrangements/ transaction NA
f. Date(s) of approval by the Board NA
g. Amount paid as advances if any NA
h. Date on which special resolution was passed in general meeting as required under first proviso to section 188 NA

B. Details of contract or arrangement or transactions at arms’ length basis:

a. Name(s) of the related party and nature of relationship NA
b. Nature of contract /arrangements/transaction NA
c. Duration of contract /arrangements/transaction NA
d. Salient terms of contract/arrangements/transaction including the value if any NA
e. Date(s) of approval by the Board NA
f. Amount paid as advances if any NA

17. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant and material orders passed by the Regulators/Courts that wouldimpact the going concern status of the Company and its future operations.

18. DIRECTORS' RESPONSIBILITY STATEMENT

To the best of knowledge and belief and according to the information and explanationsobtained by them your Directors make the following statement in terms of Section134(3)(c) of the Companies Act 2013:

i. that in the preparation of the Annual Accounts for the year ended March 31 2016the applicable accounting standards have been followed along with proper explanationrelating to material departures if any;

ii. and applied them consistently and made judgments and estimates that are reasonableand prudent so as to give a true and fair view of the state of affairs of the Company asat March 31 2016 and of the profit of the Company for the year ended on that date;

iii. that the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. that the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and

vi. That the Directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

19. STATUTORY AUDIT

M/s S. G. Kabra& Co. Chartered Accountants (Firm Registration No: 104507W) whoare the Statutory Auditors of the Company hold office up to the forthcoming Annual GeneralMeeting and are recommended for re- appointment to carry out the audit the accounts of theCompany for the financial year 2016-17. As required under the provisions of Section 139 ofthe Companies Act 2013 the Company has obtained written confirmation from M/s. S.G.Kabra & Co. that their reappointment if made would be in conformity with the limitsspecified in the said Section.

20. COST AUDIT

Provision of Section 148 of the Companies Act 2013 read with the Companies (CostRecords and Audit) Rules 2014 are not applicable to the Company during the financial yearunder review.

21. SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act 2013 and rules madethere under the Company has appointed M/s R M Mimani& Associates LLP CompanySecretaries to undertake the Secretarial Audit of the Company. The Secretarial AuditReport is annexed herewith as Annexure - B and forms an integral part of this Report.

22. INTERNAL FINANCIAL CONROL AND THEIR ADEQUACY

Your Company has policies procedures and effective internal controls for ensuringorderly and efficient conduct of the business safeguard of its assets prevention anddetection of fraud and errors accuracy and completeness of the accounting record timelypreparation of financial statements and proper disclosure.

During the financial year such controls were tested and no reportable materialweakness in the design or operation was observed.

The internal and operational audit is conducted on regular basis The main thrust ofinternal audit is to test and review controls appraisal of risks and business processesbesides benchmarking controls with best practices in the industry.

23. RISK MANAGEMENT

During the year under review the Company has identified and evaluates elements ofbusiness risk. Consequently a Business Risk Management framework is in place. The riskmanagement framework defines the risk management approach of the Company and includesperiodic review of such risks and also documentation mitigating controls and reportingmechanism of such risks.The framework has different risk models which help in identifyingrisks trend exposure and potential impact analysis at a Company level as also separatelyfor business.

Some of the risks that the Company is exposed to are:

Financial Risks

The Company's policy is to actively manage its various financial risks within theframework laid down. Given the interest rate fluctuations the Company has adopted aprudent and conservative risk mitigation strategy to minimize interest costs.

Commodity Price Risks

The Company is exposed to the risk of price fluctuation of goods in which it trades.The Company proactively manages these risks through forward booking inventory managementand proactive vendor development practices.

Regulatory Risks

The Company is exposed to risks attached to various statutes and regulations. TheCompany is mitigating these risks through regular review of legal compliances carried outthrough internal as well as external compliance audits.

24. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Provision of Schedule VII of the Companies Act 2013 read with Companies CorporateSocial Responsibility Policy) Rules 2014 are not applicable to the Company during theyear under review.

25. ENVIRONMENT AND SAFETY

The Company is conscious of the importance of environmentally clean and safeoperations. The Company's policy requires conduct of operations in such a manner so as toensure safety of all concerned compliances environmental regulations and preservation ofnatural resources.

As required by the Sexual Harassment of Women at Workplace (Prevention Prohibition& Redressal) Act 2013 the Company has formulated and implemented a policy onprevention of sexual harassment at workplace with a mechanism of lodging complaints. Itsredressal is placed on the intranet for the benefit of its employees.

During the year under review no complaints were reported to the Board.

26. STATUTORY INFORMATION

The information on conservation of energy technology absorption and foreign exchangeearnings and outgo pursuant to Section 134(3)(m) of the Companies Act 2013 read with theRule 8(3) of the Companies (Accounts) Rules 2014 are not applicable to the Company duringthe financial year under review.

The information required under Section 197 of the Companies Act 2013 read with rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014are not applicable to the Company during the financial year under review.

The Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 read with the Companies (Acceptance of Deposits) Rules 2014.

The Business Responsibility Reporting as required under SEBI (LODR) 2015 and is notapplicable to your Company for the financial year under review.

Disclosure as required under para F of Schedule V of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 are not applicable to the Company during thefinancial year.

27. CAUTIONARY STATEMENT

Statements in this Directors' Report & Management Discussion and Analysisdescribing the Company's objectives projections estimates expectations or predictionsmay be "forward-looking statements" within the meaning of applicable securitieslaws and regulations. Actual results could differ materially from those expressed orimplied.

28. APPRECIATION

Your Directors wish to thank all the stakeholders who have contributed to the successof your Company. Your Directors wish to place on record their appreciation forthecontribution made by the employees at all levels. Your Directors also wish to thank itscustomers dealers agents suppliers investors and bankers for their continued supportand faith reposed in the Company.

For and on behalf of the Board of Directors of S V TRADING AND AGENCIES LIMITED

Sd/- Sd/-
Gopal Lal Paliwal Mr. Manoharbhai P. Joshi
Managing Director Director
DIN: 06522898 DIN: 02208711
Place: Mumbai
Dated: August 11 2016

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