To The Members
Your Directors have pleasure in presenting the Twenty Seventh Annual Report of SKPSecurities Limited for the Financial Year ended March 31 2017.
Your Company's Financial Performance for the year under review is summarized below:
(In Rs. Lacs)
| ||Financial year |
|Particulars ||2016-2017 ||2015-2016 |
|Total Income ||1074.88 ||1046.07 |
|Total Expenditure ||891.38 ||879.99 |
|Profit Before Tax ||183.50 ||166.08 |
|Provision for Tax ||58.65 ||56.20 |
|Tax adjustment for earlier year ||1.30 ||0.00 |
|Profit After Tax ||123.55 ||109.88 |
|Balance of Profit brought forward from previous year ||1340.78 ||1303.48 |
|Appropriations: || || |
|Transferred to General Reserve ||5.00 ||5.00 |
|Interim Dividend || ||56.15 |
|Tax on Interim Dividend || ||11.42 |
|Balance of Profit carried forward ||1459.33 ||1340.78 |
|Earnings Per Share ( Rs.) ||2.20 ||1.96 |
|Net Worth ||2481.24 ||2357.69 |
DIVIDEND AND RESERVES
Your Directors do not recommend any dividend for the Financial Year 2016-17. A sum ofRs. 5 Lacs has been transferred to General Reserve during the year.
With an objective to return surplus cash available with the Company to Shareholders andimprove performance ratios like Return on Equity your Directors have approved Buy Back ofupto 1215600 equity shares of Rs. 10/- each fully paid up representing about 21.65% ofthe paid up equity capital of the Company at a price of Rs. 51/- per share payable in cashfor an aggregate consideration of Rs. 61996600/- not exceeding 25% of the fully paid upequity capital and free reserves of the Company in compliance with SEBI (Buy Back ofSecurities) Regulations 1998 subject to receipt of necessary statutory and regulatoryapprovals.
FY17 was quite an eventful year making financial markets quite volatile. A majorfundamental shift is happening in the developed world. Erstwhile champions ofglobalization and free markets are moving towards an "anti-globalization"environment wanting to protect their industry and jobs. This is not helping already tensegeo-political environment. Domestically we have witnessed massive events like"surgical strike" and "demonetization" amidst huge consolidationtowards political stability.
In the backdrop of continuously improving domestic macro economics after substantialvolatility whilst equity markets saw a run up to previous peak by year end debt marketis poised at cross roads after RBI's announcement of a neutral stance on policy ratesafter two years on continuous rate cuts. With falling interest in other asset classesparticularly physical asset classes investor interest is shifting towards financialinstruments like mutual funds in particular. A major growth in mutual funds assets hasbeen witnessed as a result.
In this environment your Company's business volume top-line and bottom-line have allwitnessed a moderate growth. It also acquired an office premises in Mumbai for itsoperations there.
AWARDS AND RECOGNITION
Your Directors are delighted to inform that your Company for the second consecutiveyear received the CNBC TV18 UTI Mutual Funds Best Regional Financial Advisor Award(Eastern Region) for 2016-2017. In addition it has also received CNBC TV18 UTI MutualFund Grand Jury Award for Financial Education & Inclusion for 2015-2016 a nationalrecognition in the RFA/ IFA category.
Continuously improving domestic macro economic and political scenario is doing well forfinancial markets although global risk factors remain. If the buoyancy continues infinancial markets which certainly needs to be backed by improved corporate earnings wecan reasonably expect the Company to perform well in FY18.
STATE OF COMPANY'S AFFAIRS
A detailed information on the operations of the Company business environment andfuture expectations are provided in the Management Discussion and Analysis Report which isannexed herewith and marked as Annexure "A".
CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of the Company are prepared in accordance withSection 129 of the Companies Act 2013 read with relevant Accounting Standards issued byThe Institute of Chartered Accountants of India and forms part of this Annual Report.
SUBSIDIARY & ASSOCIATE COMPANIES
The Company has two wholly owned subsidiaries viz SKP Commodities Limited and SKPInsurance Advisors Private Limited. The Company does not have any associate Company.
During the year the Board of Directors reviewed the affairs of its subsidiaries. Inaccordance with the Section 129(3) of the Companies Act 2013 a statement containingsalient features of the financial statements of the Company's subsidiaries is annexedherewith and marked as Annexure "B" in the prescribed Form AOC-1.
In accordance with section 136 of the Companies Act 2013 the audited financialstatements including the consolidated financial statements and related information of theCompany and audited accounts of each of its subsidiaries are available on our websitewww.skpmoneywise.com. These documents will also be available for inspection duringbusiness hours at our registered office.
Your Company has complied with the Corporate Governance requirements under CompaniesAct 2013 and as stipulated under the provisions of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015. A detailed report on Corporate GovernanceDeclaration of Managing Director on Code of Conduct CEO/CFO Certification and AuditorsCertificate on compliance of conditions of Corporate Governance form an integral part ofthis Report and are annexed herewith and marked as Annexure "C""D" "E" and "F" respectively.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mr. Paritosh Sinha (DIN: 00963537) has been appointed as an Additional Non-ExecutiveIndependent Director of the Company w.e.f. 30th July 2016 subject to approval ofShareholders for regularization of his appointment for a period of 5 years.
During the year Mr. Dipak Kadel (ACS 35029) the Company Secretary has resigned from theCompany w.e.f 15th July 2016 and Ms. Alka Khetawat (ACS 47322) has been appointed as theCompany Secretary and Compliance Officer of the Company
Mrs. Manju Pachisia (DIN: 00233821) Non-Executive Director will retire by rotation atthe ensuing Annual General Meeting of the Company and being eligible offers herself forre-appointment.
The brief resume and other details relating to Mr. Paritosh Sinha and Mrs. ManjuPachisia are provided in the Notice of Annual General Meeting.
NOMINATION AND REMUNERATION POLICY
The Company follows Nomination and Remuneration Policy for Directors Key ManagerialPersonnel and Senior Management Personnel and other employees of the Company as approvedby the Board of Directors. The Nomination and Remuneration Policy is annexed herewith andmarked as Annexure "G".
DECLARATION BY INDEPENDENT DIRECTORS
All Independent Directors have submitted the declaration of independence as requiredpursuant to section 149(7) of the Companies Act 2013 stating that they meet the criteriaof independence laid down in Section 149(6) of the Companies Act 2013 and Regulation 25of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS
The details of Familiarization Programme for Independent Directors' has beengiven in the Corporate Governance Report is annexed herewith and marked as Annexure"B"
In terms of the provisions of the Companies Act 2013 read with Rules issued thereunder and SEBI (Listings Obligations and Disclosures Requirements) Regulations 2015 theBoard of Directors has carried out an annual evaluation of its own performance itsCommittee and individual Directors. A structured questionnaire was prepared after takinginto consideration inputs received from the Directors covering various aspects.
Further the Independent Directors at their meeting held during the year reviewed theperformance of the Board the Non-Independent Directors and the Chairman.
BOARD AND COMMITTEES
The Board met four times during the financial year 2016-2017.
At present there are following three committees:
i) Audit Committee
ii) Nomination and Remuneration Committee
iii) Stakeholders Relationship Committee
The details of composition attendance terms of reference meetings etc. are given inthe Corporate Governance Report is annexed herewith and marked as Annexure "B".
AUDITORS AND AUDITORS' REPORT
a) Statutory Auditors
At the Annual General Meeting held on 30th July 2016 M/s. G.P. Agrawal & Co. (FRNNo: 302082E) Chartered Accountants were appointed as Statutory Auditors of your Companyto hold office till the conclusion of the Annual General Meeting to be held in theCalendar year 2017. M/s G.P. Agrawal & Co have expressed their willingness to getappointed as the Statutory Auditors of the Company for a further period of 5 yearspursuant to Section 139 of the Companies Act 2013. They have furnished certificate of theeligibility and consent under Section 141 of the Companies Act 2013 and the Rules framedthere under. In terms of SEBI (LODR) Regulations 2015 have confirmed that they by ReviewBoard of The Institute of Chartered Accountants of India.
The Auditors' Report to the members on the Accounts of the Company for the financialyear ended 31st March 2017 does not contain any qualification reservation adverseremark or disclaimer. Further In terms of section 143(12) of Companies Act 2013 nofrauds have been reported by the Auditors.
b) Secretarial Auditors
Mr. Kaushik Sonee (FCS: 7921) of K. Sonee & Co. Practicing Company Secretary wasappointed to conduct the Secretarial Audit of the Company for the Financial Year2016-2017 as required under section 204 of the Companies Act 2013 and Rules there under.The Secretarial Audit Report for the Financial Year 2016-2017 forms part of the AnnualReport is annexed herewith and marked as Annexure "h" to the Board'sReport. The Secretarial Audit Report does not contain any qualification reservation oradverse remark
EXTRACT OF THE ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT- 9 inaccordance with Section 92(3) of the Companies Act 2013 read with the Companies(Management and Administration) Rules 2014 is annexed herewith and marked as Annexure"I".
RELATED PARTY TRANSACTIONS
During the financial year 2016-2017 your Company has entered into transaction withrelated party which was in the ordinary course of business and on arm's length basisdetails of which are provided in Notes which forms an integral part of this Annual Report.The Form AOC 2 pursuant to Sec-134(3)(h) of the Companies Act 2013 read with rule 8(2) ofthe Companies (Accounts) Rules 2014 is set out as Annexure "J " to thisreport. The policy on Materiality of Related Parties Transaction and dealing with RelatedParty Transaction as approved by the Board may be accessed on Company's Websitewww.skpmoneywise.com.
LOANS GUARANTEES OR INVESTMENTS
The Company has not given any Loans and Guarantees in terms of provisions of Section186 of the Companies Act 2013. The details of Investments made are provided in Noteswhich forms an integral part of this Annual Report.
MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEES
The information as required under the provisions of Section 134(3)(q) and 197(12) ofthe Companies Act 2013 read with Rule 5(1) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 is annexed herewith and marked as Annexure"K".
EMPLOYEE STOCK OPTION PLAN
Your Company granted 100000 options to its employees under the SKP ESOP PLAN 2010 atan exercise price of Rs. 29/- which was marginally above the market price of Rs. 27.10 ason the date of grant of options. Since its issue none of the employee had exercised theoptions while 52000 options were surrendered and 48000 options were in force till 31stMarch 2016. During the Financial year 2016-17 employees holding these 48000 optionshave also surrendered their right as per the SKP ESOP PLAN 2010. Hence there are nooptions (Previous year 48000) outstanding as at the end of the Financial Year.
Your Company recognizes that risk is an integral part of business and is committed tomanaging the risks in a proactive and efficient manner. Your Company has implemented anintegrated Risk Management Policy through which it reviews and assesses significant riskson a regular basis to help ensure that there is a robust system of risk controls andmitigation in place. Senior management periodically reviews this risk management frameworkto keep updated and address emerging challenges.
In the opinion of the Board at present there are no risks which threaten the existenceof the Company.
WHISTLE BLOWER & VIGIL MECHANISM
Your Company has a well established Whistle Blower Policy as part of vigil mechanismfor Directors and employees to report concerns about unethical behaviour actual orsuspected fraud or violation of the Company's Code of Conduct or Ethics Policy. Thismechanism also provides for adequate safeguards against victimization of Director(s) /employee(s) who avail of the mechanism and also provides for direct access to the Chairmanof the Audit Committee. The said Policy may be accessed athttp://www.skpmoneywise.com/Admin/Policy/Whistle%20Blower%20Policy.pdf
Your Company hereby affirms that no Director/employee have been denied access to theChairman of the Audit Committee and that no complaints were received during the year.
ADEQUACYO F INTERNAL FINANCIAL CONTROL
The Company has an Internal Control System commensurate with size scale andcomplexity of its operations. The internal financial controls are adequate and areoperating effectively so as to ensure orderly and efficient conduct of businessoperations.
The Audit Committee in consultation with the Internal Auditor formulates the scopefunctioning periodicity and methodology for conducting the Internal Audit. Based on theInternal Audit Report and review by the Audit Committee process owners undertakenecessary actions in their respective areas.
The Board has also put in place requisite legal compliance framework to ensurecompliance of all the applicable laws and that such systems are adequate and operatingeffectively.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING/OUTGO
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo as stipulated under Section 134 of the Companies Act 2013 read withthe Companies (Accounts) Rules 2014 is annexed herewith and marked as Annexure"L".
Equity shares of the Company are listed on BSE Ltd to which your Company has paidListing Fees.
DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to as per Sec 134 (5) of the Companies Act 2013 the Directors confirm
a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
b) the directors had 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 and loss of the Company for that period;
c) the directors had 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 had prepared the annual accounts on a going concern basis;
e) the directors in the case of a listed Company had laid down internal financialcontrols to be followed by the Company and that such internal financial controls areadequate and were operating effectively;
f) the directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
1. No Deposits covered under Chapter V of the Companies Act 2013 were accepted.
2. No equity shares with differential rights as to dividend voting or otherwise; orshares (including sweat equity shares) to employees of the Company under any scheme wereissued;
3. No remuneration or commission to the Managing Director/Whole-time Director of theCompany were paid from any of its subsidiaries;
4. Orders passed by any regulatory authority or courts or tribunals No significantimpacting the going concern status and Company's operation in future;
GRATITUDE & ACKNOWLEDGEMENTS
The Board expresses its deep gratitude to clients business associates principalsbankers regulators exchanges depositories and shareholders for their valuablecontribution towards the progress of the Company. Your Directors particularly wish toplace on record their sincere appreciation of the best efforts put in by the employees atall levels but for which the Company could not have achieved what it did during the yearunder review.
|Registered Office: ||For and on behalf of the Board |
|Chatterjee International Centre || || |
|33A J. L. Nehru Road Level 21 ||Naresh Pachisia ||Nikunj Pachisia |
|Kolkata 700 071 ||(Managing Director) ||(Director) |
|Dated: 20th April 2017 ||DIN:00233768 ||DIN:06933720 |