|BSE: 533569||Sector: Consumer|
|NSE: SRSLTD||ISIN Code: INE219H01039|
|BSE 14:06 | 23 Feb||1.19||
|NSE 14:40 | 23 Feb||1.20||
|Mkt Cap.(Rs cr)||33|
|Mkt Cap.(Rs cr)||33.15|
SRS Ltd. (SRSLTD) - Director Report
Company director report
Your Directors have pleasure in presenting the 15th Annual Report of the Company for FY2014-15 along with the audited statements of accounts for the same period.
The results of your Company's financial prudence and business excellence for the yearended 31st March 2015 are as follows: -
(Rs. in Lacs)
Results of Operations and the State of Company's Affairs
The economic scenario in the country stayed upbeat with the new government formationhowever the grass root percolation of the various initiatives intended to be implementedby the government is yet to take efect. This has dampened the optimism for the nearfuture. While there was a pressure on several sectors such as auto infrastructure realestate etc. seeing subdued demand growth the consumer-driven sectors continued to staybuoyant. The falling prices of crude oil came as a major relief helping curtail inflationand the oil import bills.
Even in the midst of such a scenario your Company continued to do well consolidatingits operations and embarking on new expansions. As we speak the Company's operations spanacross 28 cities and 9 states with overseas operations in the US and UAE as well.Importantly while the year has been promising the Company also invested for futuregrowth and profitability.
In terms of operations the Company reported revenue of Rs.3830.69 Crores in FY2014-15 representing a jump of 11.33% over the figure of Rs.3440.87 crores reported inFY2013-14. The PBT and PAT for FY 15 stood at Rs.49 Crores and Rs.38.81 Croresrespectively.
The Company stays in a dynamic operational and expansion mode and as a result itscount of outlets and stores continually keeps on rising. In light of this it is importantto point out that of the various stores and cinemas mentioned by it the three cinemas atHajipur Saharanpur and Muktsar were opened under franchise model. The two retail storesin AarDee City Gurgaon and Chhatarpur New Delhi have been commissioned in FY 16 i.e. 1stApril 2015 onwards.
Apart from that there are no material changes and commitments affecting the financialposition of the company which have occurred between the end of Financial Year 2014-15 andthe date of this report.
Your Company continues to expand its operations steadily across its business verticals.In view of this your Directors consider it prudent and rational to conserve resources forbeing appropriately re-invested into the Company's future operations and therefore do notrecommend any dividend on equity shares for the financial year under review.
The details of amount lying as unclaimed in the Unpaid Dividend Account of the Companyfor the Dividend declared for the financial year 2011-12 & 2012-13 are given in theCorporate Governance Report.
Issue of Bonus Shares
The Board of Directors of the Company in its meeting held on 11th May 2015 hasdeclared the Bonus Issue of Equity Shares to the existing shareholders in the ratio of1:1 subject to the requisite approval of the shareholders and other competent authoritiesand to absorb the bonus issue the Company has also decided to increase the AuthorizedShare Capital of the Company from Rs.150 Crores to Rs.280 Crores by way of Postal Ballotin terms of Section 110 of the Companies Act 2013 read with the Companies (Management andAdministration) Rules 2014.
The issue of Equity shares by way of Bonus and increase in Authorized Share Capital hasbeen approved by the Shareholders by way of Postal Ballot on 13th June 2015 and theAllotment of Bonus Shares was made on 29th June 2015 after getting In-Principle Approvalfrom BSE & NSE on 15th June 2015.
The Company has got the Listing & Trading Approvals from BSE & NSE on 1st July2015 and 3rd July 2015 respectively and the trading of Shares commenced on 6th July2015 at both the exchanges.
Your Company has neither issued equity shares with differential rights as to dividendvoting or otherwise; nor issued any shares (including sweat equity shares) under ESOS/ESPSscheme for its employees/Directors
Board of Directors and Key Managerial Personnel
In terms of the provisions of Section 152 of the Companies Act 2013 Dr. Anil Jindalis due to retire by rotation at the forthcoming Annual General Meeting of the Company andbeing eligible ofers himself for re-appointment as Director of the Company.
Sh. Naresh Kumar Goyal was appointed as Whole-Time Director on 10th October 2014 andwas re-designated as Non-Executive Director w. e. f. 1st February 2015. As he is theManaging Director of SRS Worldwide (FZC) and usually stays in Dubai/Sharjah he showed hisinability to continue as Director of the Company and resigned on 25th April 2015. TheBoard placed on record its appreciation for the services rendered by Sh. Naresh KumarGoyal during his tenure of directorship with the Company.
Pursuant to the provisions of Section 149 150 152 and other applicable provisions ofthe Companies Act 2013 read with Rule 3 of the Companies (Appointment & Qualificationof Directors) Rules 2014 Ms. Divya Gupta was appointed as an additional (Independent)Woman Director of the Company to hold Office for five consecutive years w. e. f. 10thOctober 2014 upto 9th October 2019 not liable to retire by rotation. However due tosome other engagements she was not able to continue as Director in the Company andresigned on 25th April 2015. The Board placed on record its appreciation for the servicesrendered by Ms. Divya Gupta during her tenure of directorship with the Company.
The tenure of Sh. Vinod Kumar as Whole-Time Director was completed on 31st May 2015.In pursuance of the provisions of Section 196 and other applicable provisions of theCompanies Act 2013 the Nomination & Remuneration Committee and the Board ofDirectors in their respective meetings held on 21st May 2015 and 22nd May 2015 haveconsidered and approved the reappointment of Sh. Vinod Kumar as Whole-Time Director for afurther period of Five (5) years w. e. f. 1st June 2015. Notice under Section 160 of theCompanies Act 2013 has been received from a member intending to propose the appointmentof Sh. Vinod Kumar as Whole-Time Director of the Company at the ensuing Annual GeneralMeeting.
A brief resume of appointee Directors the nature of expertise in specific functionalareas and names of Companies in which they hold Directorship and/orMembership/Chairmanship of Committees of the Board as stipulated under Clause 49 of theListing Agreement is annexed with the Notice calling 15th Annual General Meeting of theCompany.
All the Independent Directors have given a declaration dated 31st March 2015 undersub-section (6) of Section 149 of the Companies Act 2013 conirming their independence.
In accordance with the Companies Act 2013 Dr. (Ms.) Navneet Kwatra has beenre-designated as C.O.O. & Company Secretary and Mr. Bhagwan Das has been re-designatedas CFO in the Board meeting held on 17th June 2014.
Sh. Sunil Jindal Dr. Anil Jindal Sh. Vinod Kumar and Sh. Raju Bansal being ExecutiveDirectors are not receiving any commission/remuneration from any Holding/SubsidiaryCompanies of the Company.
Number of Board Meetings
During the year under review Fifteen (15) meetings of the Board of Directors wereheld. Independent Director's also had their separate meeting on 30th March 2015. Thedetails of Board meetings and the attendance of Directors in such meetings are given inthe 'Corporate Governance Report' forming part of this Annual Report.
Performance Evaluation Mechanism
Information on the manner in which formal annual evaluation has been made by the Boardof its own performance and that of its Committees and individual directors is given in theCorporate Governance Report.
Information regarding Remuneration Policy is given in the Corporate Governance Report.
Composition of Committees
The composition of Corporate Social Responsibility Committee as required under Section135(2) and the composition of Audit Committee as required under Section 177 (8) of theCompanies Act 2013 is given in the Corporate Governance Report.
Further the Board has accepted all the recommendations of the Audit Committee duringthe year under review.
Loans Guarantees and Investments
The Company has not given guarantee in favour of any person/company during thefinancial year 2014-15.
The Company has provided following loans and has made the following investments u/s 186of the Companies Act 2013: -
Contracts or Arrangements With Related Parties
For better corporate governance and in compliance with the provisions of the CompaniesAct 2013 and Listing Agreement Board of Directors in its Meeting held on 30th September2015 has adopted the Related Party Transactions Policy of the Company.The said policy isavailable on the website of the Company www.srsparivar.com.
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's lengthbasis. There being no 'material' related party transactions as defined under the CompaniesAct 2013 read with clause 49 of the Listing Agreement hence there are no details to bedisclosed in Form AOC-2 in that regard.
The Directors of your Company are pleased to report that the Company's credit ratingsfor its Line of Credit and Fixed Deposits Scheme have been positively reviewed by ICRA andCRISIL the premier rating agencies.
ICRA has upgraded the long-term rating for the Line of Credit (LOC) from [ICRA] BBB to[ICRA]BBB+ and short-term rating for the LOC from [ICRA] A3+ to [ICRA]A2.
The CRISIL has assigned the Credit Rating FA- with stable outlook for Unsecured FixedDeposit Schemes.
The Company has accepted Public Deposits/Fixed Deposits amounting to Rs.7901.66 Lacsduring the year under review after complying with the provisions of the Companies Act2013 read with the Companies (Acceptance of Deposits) Rules 2014. During the YearRs.698.48 Lacs were paid prematurely and the balance as on 31st March 2015 is Rs.8276.50Lacs.
The Company has issued the Circular or Circular in the form of Advertisement invitingDeposits as Advance from Customers for Jewellery Scheme pursuant to section 73 andsection 76 read with rule 4(1) and 4(2) of the Companies (Acceptance of Deposits) Rules2014 which was in continuation of earlier Form DPT-1 dated 28th July 2014. However tilldate the Company has not accepted deposits under this Scheme.
There is no default in repayment of deposits or payment of interest thereon during theyear. All the deposits are in compliance with the requirements of Chapter V (Acceptance ofDeposits by Companies) of the Companies Act 2013.
Unclaimed Refund & Interest on Refund Account
The Company hasRs.344900/-as unclaimed in the Refund Account and Rs.29277/-asunclaimed in the Interest on Refund Account maintained with the State Bank of IndiaforIPO of the Company as on 31st March 2015.
M/s. S.S. Kothari Mehta & Co. Chartered Accountants and M/s. Rakesh Raj &Associates Chartered Accountants Joint Statutory Auditors of the Company retire at theensuing Annual General Meeting of the Company and have expressed their willingness forreappointment as joint statutory auditors in accordance with the Companies Act 2013 andconirmed that their re-appointment if made will be within the prescribed limits underSection 141(3) of the Companies Act 2013 and they are not disqualified for suchreappointment within the meaning of Section 141 of the said Act.
The members are requested to ratify the appointment of M/s. S.S. Kothari Mehta &Co. Chartered Accountants and M/s. Rakesh Raj & Associates Chartered Accountants asJoint Statutory Auditors of the Company from the conclusion of this AGM until theconclusion of two consecutive AGMs as mentioned in the Notice.
Presently the following firms of Chartered Accountants are the Internal Auditors ofthe Company:
M/s. Goel Mintri & Associates
M/s. R.G. Sharma & Co.
M/s. Nitin Kanwar & Associates
M/s. Love Mangla & Co.
M/s. Sumit Chhabra & Co.
M/s. SRGM & Associates
M/s. Princy Singhal & Co.
Pursuant to the Companies (Cost Records and Audit) Rules 2014 notified by the Ministryof Corporate Affairs on 30th June 2014 as amended from time to time Cost Audit is notapplicable to the Company from the financial year 2014-15 onwards as the nature of theindustry is not covered under the said Rules.
Pursuant to the provisions of Section 204 of the Companies
Act 2013 and the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 the Board has appointed Ms. Savita Trehan Company Secretary in practice toundertake the Secretarial Audit of the Company.
Secretarial Audit Report for the year 2014-15 given by Ms. Savita Trehan in theprescribed form MR-3 is annexed to this Report as Annexure-I.
The Secretarial Audit Report for the year under review does not contain anyqualiication reservation or adverse remark or disclaimer made by the secretarial auditor.
There are no qualiications reservations adverse remarks or disclaimer made by M/s. S.S. Kothari Mehta & Co. Chartered Accountants and M/s. Rakesh Raj & AssociatesChartered Accountants Joint Statutory Auditors in their report.
The auditors have not reported any incident of fraud to the Audit Committee during thefinancial year 2014-15.
Subsidiaries and Branches
The Company has acquired 100% shareholding in SRS E-Retail Limited and SRS TalkiesLimited by making investments of Rs.500000/- each in these companies on 3rd December2014 for expansion of its Retail and Cinema Business respectively.
However the said companies required more funds for their expansion and the Board ofDirectors of your company decided to concentrate on jewellery business and thus hasdivested its all investment in these Companies on 19th February 2015.
The Company has also incorporated a wholly-owned subsidiary in the name of "SRSWorldwide (FZE)" at Sharjah Airport International Free Zone (SAIF Zone) Sharjahhaving Regn. Nos.14557 & 14558 on 12th November 2014 for trading in Gold DiamondPrecious Metals & related Jewellery and General Trading respectively. The Certificateof Incorporation was issued on 8th January 2015. The Status of the Company has beenconverted from "Free Zone Establishment" to "Free Zone Company" on10th February 2015.
The Company has also opened a Branch at Sharjah Airport International Free Zone (SAIFZone) Sharjah for expansion of its jewellery business.
A report on the performance and financial position of each of the subsidiaries includedin the consolidated financial statement is set out herein as Annexure-II in theForm-AOC-1.
Consolidated Financial Statements
In compliance with Section 129(3) of the Companies Act 2013 and Accounting Standard -21 on Consolidated Financial
Statements this Annual Report also includes Consolidated Financial Statements for theyear 2014-15.
Further the Annual Accounts and related documents of the subsidiary company shall bekept open for inspection at the Registered & Corporate Office of the Company. TheCompany will also make available copy thereof upon speciic request by any Member of theCompany interested in obtaining the same.
Extract of Annual Return
The extract of the annual return as provided under sub-section (3) of section 92 of theCompanies Act 2013 is annexed to this report as Annexure - III.
Particulars of Employees and Related Disclosures
The information in terms of Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is as follows:
Note: 1. Gross Remuneration comprises of Salary Allowances and Company'scontribution to Provident Fund.
2. Other Terms & Conditions - NIL.
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are provided herein below:-
i) the ratio of the remuneration of each Director to the median remuneration of theemployees of the Company for the year 2014-15:
*Note: Sh. Naresh Kumar Goyal ceased to be the Whole-Time Director w.e.f. 31st January2015 & resigned from the Directorship of the Company on 25th April 2015.
ii) the percentage increase in remuneration of Managing Director Whole-Time DirectorCFO and Company Secretary in the financial year 2014-2015:
Moreover the remuneration of Dr. Anil Jindal has been altered by reducing the totalremuneration from Rs.15 00000/- p.m. to Rs.7 50000/- p.m. w. e. f 1st April 2015 forthe financial year 2015-2016. The alteration in the remuneration of Dr. Jindal willbenefit the Company as there will be lesser outlow of funds by reducing the monthlyfinancial burden on the Company and thus the same amount will be ploughed back in forexpansion & operational convenience of the business and to support the strategicambitions of the Company.
Further there was no increase in the remuneration of NonExecutive Directors by way ofsitting fee for attending Board/Committee meetings for the financial year 201415. No proitlinked commission is paid to Non-Executive independent Directors of the Company.
iii) the percentage increase in the median remuneration of employees during thefinancial year was 10-11%.
iv) the number of permanent employees on the rolls of Company as on 31st March 2015 is1666.
v) the average increase in remuneration is closely linked to and driven by achievementof annual corporate goals and overall business financial and operational performance ofthe Company.
vi) Comparison of the remuneration of the key managerial personnel against theperformance of the Company:
the remuneration of key managerial personnel amongst others is closely linked to anddriven by achievement of annual corporate goals and overall business financial andoperational performance of the Company. The Key Managerial Personnel were paidapproximately 6.54%in aggregate of the Profit before Tax during the Financial Year2014-15.
vii) the Company has allotted 35000004 Equity Shares of Rs.10/- each at a premium ofRs.48/- per share in the IPO in September 2011. The market price of the shares of theCompany as at 31st March 2015 at BSE compared to the IPO price decreased by 41.46%.
Variations in the market capitalization of the company price earnings ratio as at theclosing date of the current financial year and previous financial year is given below: -
viii) the average increase in the remuneration of employees was 10-11% whereas thepercentile increase in remuneration of KMPs was 11%.
ix) the comparison of the remuneration against the performance of the Company is givenin clause (vi) above.
x) there is no variable component of remuneration of the Executive Directors. Thenon-executive Directors of the Company are only entitled to sitting fees for attending theBoard and Committee meetings.
xi) there is no employee receiving remuneration in excess of the highest paid Directorduring the year:
xii) yes the remuneration is as per the Remuneration Policy of the Company:
The details of Vigil mechanism/Whistle Blower Policy are given in Corporate GovernanceReport.
Risk Management Plan
For better corporate governance and in compliance with the provisions of the CompaniesAct 2013 and Listing Agreement Risk Management Plan was adopted by the Board ofDirectors in its meeting held on 30th September 2014. The same is uploaded at the websiteof the Company www.srsparivar.com.
Disassociation of Promoters
Sh. Praveen Kumar Kapoor has disassociated with the Company as part of Promoter Groupon 28th May 2014 and Sh. Rajesh Kumar Mangla and Ms. Sunita Mangla disassociated fromthe Company as part of Promoter Group w. e. f. 14th February 2015.
Corporate Social Responsibility (CSR)
The Board of Directors at its meeting held on 26th August 2014 has approved theCorporate Social Responsibility (CSR) Policy for your Company pursuant to the provisionsof Section 135 of the Companies Act 2013 read with the Companies (Corporate SocialResponsibility Policy) Rules 2014 on the recommendations of the CSR Committee. Under theCorporate Social Responsiblity the Company has started various initiative like:
'BETI BACHAO BETI PADHAO' MISSION
Under Which The Following Was Done
An amount of Rs.10 000/- in the form of Fixed Deposit for 1st girl child andFixed Deposit of Rs.15 000/- in case of 2nd girl child (already having one girl child)was gifted to the parents of a Girl Child born in SRS Sunflag Hospital Sector-16AFaridabad
Free education for all the girl students of all the classes of Govt. SeniorSecondary School Village Firozpur Kalan Ballabgarh Faridabad i.e. all type of fees -admission fees tuition fees examination fees etc. charged by the school for all the girlstudents has been paid by the Company under its CSR programme and further books notebooks bag and required stationery items were provided to them at the time ofadmission/promotion to a class.
The following incentives were offered to the Girl Children admitted in SRSInternational School:
50% of Admission fees and 50% of Tuition fees of 1st Hundred (100) Girl Children 25%of Admission fees and 25% of Tuition fees of next Hundred (101-200) Girl Children and 25%of Admission fees and 10% of Tuition fees of every Girl Child (201 and above) was borneby SRS Limited under its CSR activity. These incentive are provided for a period of 3years.
'SRS-Swachchh Faridabad-Smart Faridabad' initiative started from Sector-14 Faridabadand included the following activities:
Placing of dustbins in Parks Road side areas Markets and at such other placeswhere the need is felt;
Maintenance of Parks;
Construction & Maintenance of Toilets in Parks Markets and other Public Places;
Purchase & running of Tractors with Trolleys Automatic Dust Collecting Machineetc. Hand carts Wipers Spades (Phawras) Gaintees Hammers Jharoos etc. for collectionof garbage medicinal spray as a precautionary measure for dengue malaria etc. wateringthe plants etc.;
Plantation Activities by planting plants at different places maintaining the sameand/or sponsoring any such activity.
Development of Village Ferozepur Kalan Ballabgarh Faridabad
The Annual Report on the CSR Activities undertaken by the Company during the financialyear is enclosed herewith as Annexure-IV
Conservation of Energy Technology Absorption Foreign Exchange Earnings and outgo
Your Company has always been a responsible corporate adhering to preservation andconservation of natural resources. It is also equally committed to do its bit towardsbeing environmentally responsible so as to ensure that its operations or business growthdo not affect the environment.
With this ideology we continue being environmentally responsible and energy deficient.After taking positive steps in this area the Company is keeping up its efforts to enhanceits sustainable footprint. The following initiatives taken over the last iscal highlightour action points in this area:
Replaced 100% CFLs and CDMTs into low consuming LED lights at SRS Mall and all theoutlets of SRS Value Bazaar. By this we can achieve optimum conservation of electricity.
Installed Air Cooled Fluid Cooler for 1010 KVA DG set for lower fuel consumption
Completion & Execution of up-gradation of Rain Water Harvesting System.
Planning for more harvesting tank after execution of this there will be zero waterdischarge status from SRS Mall area and will be in a position to harvest every drop ofrain water it will improve the ground water substantially.
Installed latest technology Energy Star Rating HVAC items for reduced electricityconsumption
Regularly & timely servicing of all DG sets and equipment for lower fuelconsumption
Increased green area around the mall which is not only environmentally friendly butalso helps control the temperature.
Recycling of water is primary agenda and at SRS Mall fresh water for fountains is used& when water is changed this water is used for gardening purpose. This water is notdrain in sewer/drain lines.
This reflects the Company's focus on the core matter of energy conservation and it iscommitted to actively work in this direction with the clear understanding that even smallefforts in this direction are big steps that will bring about a positive diference.
ii) Technology Absorption : Nil
iii) Foreign Exchange Earning & Outgo
Earning in foreign Currency:
Expenditure in foreign Currency:
Directors' Responsibility Statement
Pursuant to clause (c) of sub-section (3) of Section 134 of the Companies Act 2013the Directors of the Company confirm the following: -
(a) that in the preparation of the annual accounts for the year ended 31st March 2015the applicable accounting standards had been followed along with proper explanationrelating to material departures;
(b) that the directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the proit and loss of the Company for that period;
(c) that the directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
(d) that the directors had prepared the annual accounts on a going concern basis;
(e) 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
(f) that the directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingefectively.
Details on Internal Financial Controls Related to Financial Statements
Your Company has put in place adequate internal financial controls with reference tothe financial statements some of which are outlined below:
Your Company has adopted accounting policies which are in line with the AccountingStandards prescribed in the Companies (Accounting Standards) Rules 2006 that continue toapply under Section 133 and other applicable provisions if any of the Companies Act2013 read with Rule 7 of the Companies (Accounts) Rules 2014 and relevant provisions ofthe Companies Act 1956 to the extent applicable. These are in accordance with generallyaccepted accounting principles in India. Changes in policies if any are approved by theAudit Committee in consultation with the Auditors.
Disclosures Under Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013
Your Company has a policy for the prevention of sexual harassment which has beenimplemented in the organization. It ensures prevention and deterrence towards thecommissioning of acts of sexual harassment and communicates procedures for theirresolution and settlement. A Committee has been constituted in accordance with therequirements under the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013 which ensures implementation and compliance with the Law as wellas the policy.
During the year under review there were no cases iled pursuant to the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.
Significant/Material Orders Passed By The Regulators
There are no significant/material orders passed by the Regulators or Courts orTribunals impacting the going concern status of your Company and its operations in future.
Corporate Governance Report
The report on Corporate Governance together with the certiicate from Ms. Savita TrehanPracticing Company Secretary [FCS No.4374] confirming the compliance of the CorporateGovernance is annexed to this report for information of the Members.
Management's Discussion & Analysis
The Management's Discussion and Analysis Report of financial condition and results ofoperations of the Company is given as a separate statement forming part of this AnnualReport.
As a company grows in terms of geographical presence and scale the real drivers ofsuccess become the people who work to execute the vision of the board and seniormanagement with the later taking a strategic rather than an executive role. Success comeswhen an organization starts living the principle of 'Many in body One in spirit'.
Such is the case with SRS Limited which has grown substantially over the years withoperations spanning multiple cities and myriad verticals. The Board believes that theforce behind the company's progress is the various stakeholders who put their belief inthe Company's vision and work to make it a reality.
This said the Board warmly places on record its deep appreciation to all whocontributed to the Company's success directly or indirectly from within or outside theCompany.
The Board extends its very warm appreciation to the shareowners of the Company whostood by the Company and enabled it to work professionally to achieve its objectives.Their faith and belief in it is a key reason behind the Company's success all these years.The best-laid plans can work wonders only if they are allowed for implementation - in thisregard the Board wishes to praise and thank the regulatory & administrative bodiesthat supported and guided the Company and extended the due permissions and approvals toconduct business.
Special vote of thanks goes out to the bankers of the Company who gave wings to itsplans - along with the support they extended; the Board deeply appreciates their strongbelief in the Company its processes and its future. Thanks also to the auditors of theCompany who helped the Company adhere to its high levels of propriety transparencydisclosures and controls. The Board places its appreciation to all its business associatesand vendors who worked as the de facto team members of the Company.
Thanks in extremely warm and rich measures to the customers of the Company who chosethe SRS brand with full faith and enjoyed the Company's products and services time aftertime; as well as to the local communities and overall society for all their support.Lastly but not the least warm tributes to the management and team of SRS who are thereal architects of the Company's success.
It is the Company's good fortune to have the support of all the above stakeholders andthe Board resolves to carry forward diligently the inclusive progress and growth of theCompany.
Annexure I to Board's Report
SECRETARIAL AUDIT REPORT
For the Financial Year Ended 31st March 2015
[Pursuant to section 204(1) of the Companies Act 2013 and Rule 9 of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules 2014]
I have conducted the Secretarial Audit of the compliances of applicable statutoryprovisions and the adherence to good corporate practices by M/s. SRS LIMITED (CIN:L74999HR2000PLC040183) (hereinafter called the "Company"). Secretarial Audit wasconducted in a manner that provided me a reasonable basis for evaluating the corporateconducts/ statutory compliances and expressing my opinion thereon.
Based on my verification of the books papers minute books forms and returns iled andother records maintained by the Company and also the information provided by the Companyits Officers agents and authorized representatives during the conduct of secretarialaudit I hereby report that in my opinion the company has during the audit periodcovering the financial year ended on 31st March 2015 complied with the statutoryprovisions listed hereunder and also that the Company has proper Board processes andcompliance mechanism is in place to the extent in the manner and subject to the reportingmade hereinafter:
I have examined the books papers minute books forms and returns filed and otherrecords maintained by M/s.SRS Limited for the financial year ended on 31st March 2015according to the provisions of:
(i) The Companies Act 2013 (the "Act") and the rules made there under;
(ii) The Securities Contracts (Regulation) Act 1956 ('SCRA') and the rules made thereunder;
(iii) Foreign Exchange Management Act 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment Overseas Direct Investment and ExternalCommercial Borrowings;
(iv) The following Regulations and Guidelines prescribed under the Securities andExchange Board of India Act 1992 ('SEBI Act') viz. :-
a. The Securities and Exchange Board of India (Substantial Acquisition of Shares andTakeovers) Regulations 2011;
b. The Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 1992;
c. The Securities and Exchange Board of India (Issue of Capital and DisclosureRequirements) Regulations 2009;
(v) Other laws which are specifically applicable to the Company.
And hereby certify that the company has made compliance with all the provisions of theabove said Act(s) and Regulations.
I have also examined compliance with the applicable clauses of the following:
(i) Secretarial Standards issued by The Institute of Company Secretaries of India
As Secretarial Standards issued by The Institute of Company Secretaries of India asnotified and approved by Ministry of Corporate Affairs are effective from 1st July 2015;hence reporting of compliances under Secretarial Standards are not applicable for theperiod under Audit.
(ii) The Listing Agreements entered into by the Company with the BSE Limited &National Stock Exchange of India Limited.
The Company has complied with all the applicable clauses of the Listing Agreement.
I further report that as per the nature of activities carried by the Company duringthe period under audit the following Acts Rules Regulations Guidelines Standards etc.are not applicable to the Company during the audit period:
a) The Depositories Act 1996 and the Regulations and Bye-laws framed thereunder;
b) The Securities and Exchange Board of India (Employee Stock Option Scheme andEmployee Stock Purchase Scheme) Guidelines 1999;
c) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations2009;
d) The Securities and Exchange Board of India (Buyback of Securities) Regulations1998;
e) The Securities and Exchange Board of India (Registrar to an Issue and Share TransferAgents) Regulations 1993 regarding the Companies Act and dealing with Client;
I further report that:
The Board of Directors of the Company is duly constituted with proper balance ofExecutive Directors Non-Executive Directors and Independent Directors. The changes in thecomposition of the Board of Directors that took place during the period under review werecarried out in compliance with the provisions of the Act.
Adequate notice is given to all directors to schedule the Board Meetings agenda anddetailed notes on agenda were generally sent at least seven daysin advance and a systemexists for seeking and obtaining further information and clariications on the agenda itemsbefore the meeting and for meaningful participation at the meeting.
All decisions of Board Meetings and Committee Meetings are carried out unanimously asrecorded in the Minutes of the Meetings of the Board of Directors or Committee(s) of theBoard as the case may be.
I further report that there are adequate systems and processes in the Companycommensurate with the size and operations of the Company to monitor and ensure compliancewith applicable laws rules regulations and guidelines.
I further report that during the audit period following speciic events/actions weretaken by the Company which have major bearing on the company's afairs in pursuance of theact rules regulations guidelines standards etc. referred above:
a) The Company has incorporated a Wholly Owned Subsidiary in the name of "SRSWorldwide (FZE)" at Sharjah Airport International Free Zone (SAIF Zone) Sharjahhaving Regn. Nos.14557 & 14558 on 12th November 2014 for trading in Gold DiamondPrecious Metals & related Jewellery and General Trading respectively.
The Certiicate of Incorporation has been issued on 8th January 2015. The Status of theCompany has been converted from "Free Zone Establishment" (FZE) to "FreeZone Company" (FZC) on 10th February 2015.
b) Members have enabled Borrowing Powers of the Company up to a limit of Rs.12000Crores over and above the aggregate of the paid-up share capital and free reserves underSection 180(1)(c) of the Companies Act2013.
c) Members have enabled Creation of Charges on the movable and immovable properties ofthe Company both present and future in respect of borrowings etc.under Section180(1)(a) of the Companies Act2013 through Postal Ballot.
SRS Tower 305 & 307 3rd Floor
Near Metro Station Mewla Maharajpur
G.T. Road Faridabad
My Secretarial Audit Reportis for the financial year 2014-15 of even date is to be readalong with the following notes:
1. Maintenance of secretarial record is the responsibility of the management of theCompany. My responsibility is to express an opinion on these secretarial records based onmy audit.
2. I have followed the audit practices and processes as were appropriate to obtainreasonable assurance about the correctness of the contents of the Secretarial records.
The verification was done on test basis to ensure that correct facts are reflected insecretarial records. I believe that the processes and practices I followed provide areasonable basis for my opinion.
3. I have not verified the correctness and appropriateness of financial recordspersonal records of employee(s) and Books of Accounts of the Company.
4. Wherever required! have obtained the Management representation about the complianceof laws rules and regulations and happening of events etc.
5. The compliance of the provisions of Corporate and other applicable laws rulesregulations standards is the responsibility of management. My examination was limited tothe verification of procedures on test basis.
Annexure II to Board's Report
(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of
Companies (Accounts) Rules 2014)
Statement containing salient features of the financial statement ofsubsidiaries/associate companies/joint ventures
Part "A": Subsidiaries
The company has no other subsidiary associate or joint venture company which has yetto start its operations. Two Companies namely SRS E-Retail Limited and SRS Talkies Limitedcease to be subsidiaries on 6th February 2015
I. Registration and Other Details
II. Principal Business Activities of the Company
All the business activities contributing 10% or more of the total turnover of thecompany are: -
III. Particulars of Holding Subsidiary And Associate Companies
IV. Shareholding Pattern (Equity Share Capital Break-up as percentage of TotalEquity)
i) Category-wise Share holding
ii. Shareholding of Promoters
iii) Change in Promoters' Shareholding
iv) Shareholding Pattern of Top Ten Shareholders (Other than Directors Promoters andholders of GDRs & ADRs)
* Not in Top Ten Shareholders as on 31.03.2015
* Not in Top Ten Shareholders as on 01.04.2014
* Not in Top Ten Shareholders as on 01.04.2014
v) Shareholding of Directors and Key Managerial Personnel
*Appointed as Whole-Time Director on 10th October 2014 and redesignated as Director w.e. f. 1st February 2015. Resigned from Directorship on 25th April 2015.
Indebtedness of the Company including interest outstanding/accrued but not due forpayment
VI. Remuneration Of Directors And Key Managerial Personnel
A. Remuneration to Managing Director Whole-Time Directors and/or Manager
B. Remuneration to other Directors
* Resigned from directorship on 17th June 2014.
Overall ceiling as per the Act For Executive Directors - Rs. 51900469 forNon-Executive
/ Independent Directors - Rs. 100000 for attending each meeting of Board of Directorsor committee meetings.
C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD
VII. Penalties/Punishment/Compounding of Offences:
Annexure IV to Board's Report
ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES
1. A brief outline of the Company's CSR policy including overview of projects orprogrammes proposed to be undertaken and a reference to the web-link to the CSR Policy andprojects or programs
The CSR Policy is adopted by the Board of Directors in their meeting held on 26thAugust 2014.
The brief details of the policy are as follows:
SRS is a relationship-driven entity which deeply values the direct and indirect roleplayed by varied elements of the society in its success. As a conscientious corporatecitizen that works with a human touch it believes in going beyond business to creategoodness all around. This sentiment is well captured in our vision for CSR: "Enhancethe quality of life of people by providing them with key skills aid and support to make amarked change in their living conditions putting in place a sustainable advantage toenable them live an empowered life. As a result help in creating a lasting human socialeconomic and cultural capital for the society."
The CSR Policy of the SRS Limited is to:
Eradicating hunger poverty and malnutrition promoting preventive health careand sanitation and making available safe drinking water;
Promoting education including special education and employment enhancingvocational skills especially among children women elderly and the differently abled andlivelihood enhancement projects;
Promoting gender equality empowering women setting up homes and hostels forwomen and orphans; setting up old age homes day care centres and such other facilitiesfor senior citizens and measures for reducing inequalities faced by socially andeconomically backward groups;
Ensuring environmental sustainability ecological balance protection of floraand fauna animal welfare agro forestry conservation of natural resources andmaintaining quality of soil air and water;
Protection of national heritage art and culture including restoration ofbuildings and sites of historical importance and works of art; setting up publiclibraries promotion and development of traditional arts and handicrafts;
Measures for the benefit of armed forces veterans war widows and theirdependents;
Training to promote rural sports nationally recognized sports Paralympicsports and Olympic sports;
Contribution to the Prime Minister's National Relief Fund or any other fund setup by the Central Government for socio-economic development and relief and welfare of theScheduled Castes the Scheduled Tribes other backward classes minorities and women;
Contributions or funds provided to technology incubators located within academicinstitutions which are approved by the Central Government;
Rural development projects; and
Slum area development.
Apart from this the CSR Policy shall retain a dynamic outlook and shall take a call onthe sectors activities and areas for focus with a view to maximize the productivity fromsuch efforts. SRS will also have the option to partner with complimentary governmentalbodies NGOs industry bodies proven social welfare experts etc. so as to create a moresynergistic CSR plan.
2. Composition of CSR committee as on 31st March 2015
3. Average Net Profit of the Company for last three financial years
Average Net Profits - Rs.508829140/-
4. Prescribed CSR Expenditure (two percent of the amount as in item 3 above)
CSR Expenditure -Rs.10176583/-
5. Details of CSR spent during the financial year:
a) Total amount spent for the financial year: Rs.1 04 31895/-
b) Amount unspent if any: Nil
a) Manner in which the amount spent during the financial year is detailed below:
The CSR Committee confirms that the implementation and monitoring of the CSR policy isin compliance with the CSR objectives and policy of the Company.