Swastika Investmart Ltd.
|BSE: 530585||Sector: Financials|
|NSE: N.A.||ISIN Code: INE691C01014|
|BSE LIVE 15:40 | 24 Nov||155.40||
|NSE 05:30 | 01 Jan||Stock Is Not Traded.|
Swastika Investmart Ltd. (SWASTIKAINVESTM) - Director Report
Company director report
The Members of
M/s Swastika Investmart Limited
Your Directors are pleased to present the 24rd Annual Report on the businessand operations of the company together with the Standalone and Consolidated AuditedFinancial Statements for the year ended 31st March 2016.
1. STATE OF AFFAIRS FINANCIAL PERFORMANCE AND FUTURE OUTLOOK :
1.1 FINANCIAL HIGHLIGHTS AND SUMMARY OF STANDALONE AND CONSOLIDATED FINANCIALSTATEMENTS.
The performance highlights and summarized financial results of the Company are givenbelow:
(Rupees in Lakhs except EPS)
1.2 OPERATIONAL AND STATE OF COMPANY'S AFFAIRS
During the year under review the company's gross income was Rs. 2269.09 lakhs(Previous year Rs. 2345.70 lakhs) on a standalone basis however Company has reported lossof Rs. 22.96 lakhs as compared to previous years profit of Rs. 362.36 lakhs. On aconsolidated basis during the year under review the Company has gross income of Rs.3164.80 lakhs (Previous year Rs. 2966.51 lakhs) however Company has reported overall lossof Rs. 32.56 lakhs during the current year as compared to previous year profit of Rs.437.75 lakhs.
The consolidated financials reflect the cumulative performances of Swastika InvestmartLimited along with its subsidiaries. Detailed description about the business carried outis contained in the Management Discussion and Analysis report.
1.3 FUTURE OUTLOOK
Despite a number of years of declining equity volumes globally the outlook for theIndian Capital market is still quite positive. We continue to believe that corporateprofits and equity market performance will warrant continued interest from IndianInstitutional Investors and Foreign Investors. Our company will be focusing on activationof inactive accounts along with acquiring fresh clients into the capital markets. Weexpect a great revival of IPO/FPO market which is expected to bring retail investors inthe market. We are planning to provide wide range of financial services to present andprospective clients under one roof.
2. CHANGE IN NATURE OF BUSINESS
During the year there was no change in business activity of the company.
3. SHARE CAPITAL
The Paid-Up Equity Share Capital as at 31st March 2016 stood at Rs. 295.97 Lacs. Duringthe year under review the company has not issued shares with differential voting rightsnor has granted any stock option or sweat equity shares. As on 31st March 2016 none ofthe Directors of the company hold instruments convertible into equity shares of theCompany.
4. 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 as Annexure - A and forms anintegral part of this Report.
5. NUMBER OF MEETINGS OF THE BOARD ITS COMMITTEES & AGM
The details of the number of meetings of the Board and its committee held during theFinancial Year 2015 -16 forms part of the Corporate Governance Report. Further Annualgeneral meeting of the Company for financial year 2014-15 was held on 22ndSeptember 2015.
Inspite of losses your directors are pleased to recommend a final dividend of 10% onthe equity shares i.e. Re.1/- per Equity Share of face value Rs.10/- each aggregating toRs.2959700/- for financial year 2015-16 from Reserves & Surplus available withcompany subject to Approval of the members in ensuing 24th Annual GeneralMeeting. AMOUNT TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
During the year 2015-16 unclaimed Dividend for financial year 2007-08 of Rs.147843/- was transferred to the Investor Education and Protection Fund as requiredunder the Investor education and Protection Fund (Awareness and Protection of Investor)Rules 2001.
7. AMOUNTS TRANSFERRED TO RESERVES
During the year there was no amount transferred to reserve due to losses.
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.
UNSECURED LOAN FROM DIRECTORS
The Company has not received any unsecured loan from its directors during the financialyear 2015-16.
9. SUBSIDIARY COMPANIES JOINT VENTURES OR ASSOCIATE COMPANIES
Your Company has three Subsidiaries i.e. Swastika Commodities Private Limited SwastikaFin-Mart Private Limited and Swastika Insurance Services Limited. Financials to theSubsidiaries are disclosed in the Consolidated Financial Statements which form part ofthis Annual Report. A statement containing salient features of the Financial Statements ofthe Subsidiaries are annexed to this Report as ANNEXURE B pursuant to Section 129(3) ofthe Companies Act 2013 and the rules made there under in the prescribed form AOC-1 andhence not repeated here for sake of brevity. The Company does not have any joint ventureor associate Company.
Details of loans and advances given to its wholly owned subsidiaries have been reportedin notes to the financial statement.
Further during the financial year 2016-2017 Swastika Insurance Services Limited whichwas subsidiary company has become a wholly owned subsidiary company.
In accordance with third proviso to Section 136(1) of the Companies Act 2013 theAnnual Report of your Company containing inter alia the audited standalone andconsolidated financial statements has been placed on the website of the Company at
In terms of Section 136 of the Companies Act 2013 ('the Act') financial statements ofthe subsidiary companies are not required to be sent to the members of the Company.
The Company shall provide a copy of the annual accounts of its subsidiary companies tothe members of the Company on their request. The annual accounts of its subsidiarycompanies will also be kept open for inspection at the registered office of the Companyduring business hours.
10. CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the Accounting Standard AS-21 on consolidated financial statementyour directors provide the Audited Consolidated Financial statements in the Annual Report.
11. DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL.
In accordance with the provisions of Section 152 of the Companies Act 2013 and theCompany's Articles of Association Mr. Anil Kumar Nyati Director retires by rotation atthe forthcoming Annual General Meeting and being eligible offers himself forre-appointment. The Board recommends his re-appointment for the consideration of theMembers of the Company at the ensuing Annual General Meeting.
At the 23rd annual general meeting held on 22nd September 2015 appointmentof Mr.Kailash Chander Sharma was confirmed as an independent director of the Companypursuant to Section 149 152 160 of the Companies Act 2013 for a term of fiveconsecutive years.
During the year under review there was no change in the Board of Directors of theCompany. The following have been designated as the Key Managerial Personnel of the Companypursuant to sections 2(51) and 203 of the Companies Act 2013 read with the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014:
1. Shri Sunil Nyati Managing Director;
2. Smt. Anita Nyati Whole Time Director;
3. Mr. Parth Nyati Chief Financial Officer;
4. Smt. Shikha Bansal Company Secretary and Compliance officer DISQUALIFICATIONS OFDIRECTORS
During the year declarations were received from the Directors of the Company pursuantto Section 164 of the Companies Act 2013. Board appraised the same and found that none ofthe director is disqualified for holding office as director.
12. DECLARATION BY INDEPENDENT DIRECTOR
The Company has received declarations from all the Independent Directors of the Companyconfirming that they fulfil the criteria of independence as prescribed under sub-section(6) of section 149 of the Companies Act 2013 and the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015.
13. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to section 134(5) of the Companies Act 2013 the board of directors to thebest of their knowledge and ability confirm that:
i. In the preparation of the annual accounts the applicable accounting standards havebeen followed and there are no material departures in adoption of these standards;
ii. The Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe loss of the Company for that period;
iii. The Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
iv. The Directors have prepared the annual accounts on a going concern basis;
v. The Directors have laid down internal financial controls to be followed by theCompany and such internal financial controls are adequate and operating effectively;
vi. The Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
14. FAMILIARIZATION OF INDEPENDENT DIRECTORS
The details of familiarization programme for Independent Directors have been disclosedon website of the Company at web link
15. MEETING OF INDEPENDENT DIRECTORS
The Independent Directors met once during the year as on 15th March 2016.The Meeting was conducted in an informal manner without the presence of the Chairman theWhole Time Director the Non-Executive NonIndependent Directors and the Chief FinancialOfficer.
16. COMMITTEES OF THE BOARD OF DIRECTORS
The Company has various committees which have been constituted as a part of the goodcorporate governance practices and the same are in compliance with the requirements of therelevant provisions of applicable laws and
statutes. Your Company has an adequately qualified and experienced Audit Committee withShri Raman Lal Bhutda (Chairman) Shri Chain Raj Doshi Shri Kailash Chander Sharma andShri Sunil Chordia as Members. The recommendations of the Audit Committee were dulyapproved and accepted by the Board during the year under review.
The other Committees of the Board are:
(i) Nomination and Remuneration Committee
(ii) Stakeholders Relationship Committee
The details with respect to the composition powers roles terms of referenceMeetings held and attendance of the Directors at such Meetings of the relevant Committeesare given in detail in the Report on Corporate Governance of the Company which forms partof this Report.
17. STATEMENT INDICATING THE MANNER IN WHICH FORMAL ANNUAL EVALUATION HAS BEEN MADE BYTHE BOARD OF ITS OWN PERFORMANCE ITS DIRECTORS AND THAT OF ITS COMMITTEES
The board of directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act and thecorporate governance requirements as prescribed by Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 ("SEBI ListingRegulations").
The performance of the board was evaluated by the board after seeking inputs from allthe directors on the basis of the criteria such as the board composition and structureeffectiveness of board processes information and functioning etc.
The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc. The board and the nomination and remunerationcommittee reviewed the performance of the individual directors on the basis of thecriteria such as the contribution of the individual director to the board and committeemeetings like preparedness on the issues to be discussed meaningful and constructivecontribution and inputs in meetings etc. In addition the chairman was also evaluated onthe key aspects of his role.
Performance Evaluation Criteria for Independent Directors:
The performance evaluation criteria for independent directors are determined by theNomination and Remuneration committee. An indicative list of factors that may be evaluatedinclude participation and contribution by a director commitment effective deployment ofknowledge and expertise effective management of relationship with stakeholders integrityand maintenance of confidentiality and independence of behavior and judgments
18. PARTICULARS OF LOAN GUARANTEES AND INVESTMENTS U/S 186
Pursuant to Section 186 of Companies Act 2013 and Schedule V of the Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 ("Listing Regulations") disclosure on particulars relating to Loansadvances guarantees and investments are provided in Audit Report and the notes to thefinancial statements.
19. PARTICULARS OF CONTRACTS ORARRANGEMENTS WITH RELATED PARTIES
All transactions entered with Related Parties for the year under review were on arm'slength basis and in the ordinary course of business pursuant to the provisions of Section188 of the Companies Act 2013 and the Rules made there under. Also there was nocontract/arrangement/transaction with any of the Related Parties which could be consideredmaterial in accordance with the Companies Act 2013 rules framed there under andRegulation 23 of SEBI (Listing Obligations & Disclosure Requirements) Regulations2015. Hence AOC-2 is not required. The Details of the related party transactions asrequired under Accounting standard -18 are set out in Note 22(4)(B) to the financialstatement forming part of this Annual Report.
All Related Party Transactions are placed before the Audit Committee and the Board forreview and approval on a quarterly basis. Omnibus approval was obtained on a quarterlybasis for transactions which are of repetitive nature. The policy on Related PartyTransactions as approved by the Board of Directors has been uploaded on the website of theCompany. The web-link of the same has been provided in the Corporate Governance Report.None of the Directors has any pecuniary relationship or transactions vis-a-vis theCompany.
20. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars in respect of conservation of energy technology absorption and foreignexchange earnings and outgo as required under sub-section (3) (m) of section 134 of theCompanies Act 2013 read with Rule (8)(3) of the Companies (Accounts) Rules 2014 aregiven as under :
(A) Conservation of Energy
The steps taken or impact on conservation of energy:
(i) The operations of your Company are not energy intensive. However adequate measureshave been initiated to reduce energy consumption.
(ii) The capital investment on energy conservation equipments: Nil
(B) Technology Absorption :
(i) The efforts made towards technology absorption: Not Applicable.
(ii) The benefits derived like product improvement cost reduction product developmentor import substitution: Not Applicable.
(iii) In case of imported technology (imported during the last three years reckonedfrom the beginning of the Financial Year): Not Applicable.
(iv) Company has not incurred any expenditure on Research and Development during theyear under review. Further there was neither inflow nor outflow of foreign exchange duringthe year.
21. STATEMENT IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROL WITH REFERENCE TOTHE FINANCIAL STATEMENTS.
Your company has an effective internal control and risk mitigation system which areconstantly assessed and strengthened with new/revised standard operating procedures. Thecompany's internal control system is commensurate with its size scale and complexities ofits operations; the internal and operational audit is entrusted to M/s. Vinod Rekha &Company Chartered Accountants. The main thrust of internal audit is to test and reviewcontrols appraisal of risks and business processes besides benchmarking controls withbest practices in the industry.
The audit committee of the board of directors actively reviews the adequacy andeffectiveness of the internal control systems and suggests improvements to strengthen thesame. The company has a robust management information system which is an integral part ofthe control mechanism.
The audit committee of the board of directors statutory auditors and the businessheads are periodically apprised of the internal audit findings and corrective actionstaken. Audit plays a key role in providing assurance to the Board of Directors.Significant audit observations and corrective actions taken by the management arepresented to the audit committee of the board. To maintain its objectivity andindependence the internal audit function reports to the chairman of the audit committee.Report of statutory auditors for internal financial control system is part of AuditReport.
22. CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY
Provisions of section 135 of the Companies Act 2013 does not apply to the Companytherefore Company has not constituted Corporate Social responsibility (CSR) committee asrequired under the Act.
23. REMUNERATION POLICY / DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS KEYMANAGERIAL PERSONNEL AND PARTICULARS OF EMPLOYEES:
In accordance with Section 178 and other applicable provisions if any of the CompaniesAct 2013 read with the Rules issued there under and the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board of Directors formulated theNomination and Remuneration Policy of your Company on the recommendations of theNomination and Remuneration Committee. The Nomination and Remuneration Policy of thecompany is annexed as Annexure-C and forms an integral part of this report.
The Disclosure required under Section 197(12) of the Companies Act 2013 read with theRule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014as amended up to date is annexed as Annexure - D and forms an integral part of thisReport.
None of the employee of the company is drawing more than Rs.10200000/- per annum orRs.850000/- per month or for the part of the year during the year under reviewtherefore Particulars of the employees as required under Section 197 of Companies Act2013 read with rule 5(2) & rule 5(3) of Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are not applicable during the year under review.
Neither the Managing Director nor Whole Time Director of the Company received anyremuneration or commission from any of its subsidiaries. However Mr Anil Nyati who is nonexecutive Director of the Company is drawing remuneration from Swastika CommoditiesPrivate Limited.
24. REPORT ON CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION ANALYSIS.
As per Regulation 34 (3) read with Schedule V of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 a separate section on corporate governancepractices followed by the Company together with a certificate from the practicingChartered Accountant confirming compliance forms an integral part of this Report.
25. DISCLOSURE ON ESTABLISHMENT OF A VIGILMECHANISAA/WHISTLE BLOWER POLICY
The Company has a whistle blower policy to report genuine concerns or grievances. Thedetails of establishment of the reporting mechanism are disclosed on the website of theCompany (www.swastika.co.in). No Personhas been denied access to the Audit Committee.
26. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALSIMPACTING THE GOING CONCERN STATUS OF THE COMPANY.
There are no significant and material orders passed by the Regulators/Courts that wouldimpact the going concern status of the Company and its future.
27. SECRETARIAL AUDIT
Pursuant to the provisions of Section 204 of the Companies Act 2013 and Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the company hasappointed M/s. L.N.Joshi & Company Practicing Company Secretary to undertake as theSecretarial Auditor of the company. The Secretarial Audit report is annexed as ANNEXURE-Eand forms an integral part of this Report.
EXPLANATION TO SECRETARIAL AUDITOR'S REMARKS
The Company is in process to file requisite forms with ROC. Due to procedural delayforms were submitted with some delay but with in the prescribed time with adequateadditional filing fee prescribed under the Companies Act 2013. Apart from this theSecretarial audit report does not contain any qualification reservation or adverse remarkfor the year under review.
Pursuant to the provisions of section 139 of the Act and the rules framed thereunderM/s. R.S.Bansal & Company Chartered Accountants (Firm Registration No.000939C) wereappointed as statutory auditors of the Company from the conclusion of the 23 rdannual general meeting (AGM) of the Company held on 22.09.2015 till the conclusion of the28th annual general meeting to be held in the year 2020 subject toratification of their appointment at every AGM.
M/s. R.S.Bansal & Company Chartered Accountants (Firm Registration No.000939C) whoare Statutory Auditors of the Company hold office up to the forthcoming Annual GeneralMeeting and are recommended for re-appointment for the financial year 2016-17. As requiredunder the provisions of Section 139 of the Companies Act 2013 the Company has obtainedwritten confirmation from M/s. R.S.Bansal & Company Chartered Accountants for theirappointment if made would be in conformity with the limits specified in the said Section
EXPLANATION TO AUDITOR'S REMARKS
The Auditors in their report have referred to the notes forming part of the Accountswhich are self-explanatory and does not contain any qualification reservation or adverseremark or disclaimer.
Further there was no fraud in the Company which was required to report by statutoryauditors of the Company under sub-section (12) of section 143 of Companies Act 2013.
The Board has appointed M/s. Vinod Rekha & Company Chartered Accountant asInternal Auditor of the company and takes their suggestions and recommendations to improveand strengthen the internal control systems. their scope of work includes review ofoperational efficiency effectiveness of systems & processes compliances andassessing the internal control strengths in all areas.
The Audit Committee reviews adequacy and effectiveness of the Company's internalcontrol environment and monitors the implementation of audit recommendations includingthose relating to strengthening of the Company's risk management policies and systems.
30. MD/CFO CERTIFICATION
As required under Regulation 17(8) of the Listing Regulations the Managing Directorand Chief Financial Officer of the Company have certified to the Board regarding theFinancial Statements for the year ended 31st March 2016. Copy of thecertificate is separately annexed with this annual report.
31. CODE OF CONDUCT
The Company has laid down a code of conduct for all Board members and senior managementand independent directors of the Company. All the Board members including independentdirectors and senior management personnel have affirmed compliance with the code ofconduct. Declaration on adherence to the code of conduct is forming part of the CorporateGovernance Report.
32. CODE FOR PROHIBITION OF INSIDER TRADING PRACTICES:
Your Company has adopted the code as per SEBI (Prohibition of Insider Trading)Regulations 2015 which has been effective from 15th May 2015. The Details ofthe said code is available on website of the Company i.e www. swasti ka. co. i n
33. STATEMENT INDICATING DEVELOPMENT & IMPLEMENTATION OF RISK MANAGEMENT POLICY:
The Board of Directors has adopted risk management policy for the Company whichprovides for identification assessment and control of risks which in the opinion of theBoard may threaten the existence of the Company. The Management identifies and controlsrisks through a properly defined framework in terms of the aforesaid policy.
34. MATERIAL CHANGES & COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY
No material changes and commitments affecting the financial position of the companyhave occurred between the end of the financial year to which the financial statementsrelate and the date of this Board's report. During financial year 2016-17 SwastikaInsurance Services Limited which was subsidiary company has become wholly owned subsidiarycompany.
35. ENVIRONMENT AND SAFETY
The Company is conscious of the importance of environmentally clean and safeoperations. The Company's policy required conduct of operations in such a manner so as toensure safety of all concerned compliances environmental regulations and preservation ofnatural resources.
36. SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION & REDRESSAL)ACT 2013
The Company has in place an Anti Sexual Harassment Policy in line with the requirementsof The Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal)Act 2013. An Internal Complaints Committee (ICC) has been set up to redress the Complaintreceived regarding sexual harassment. There was no case of sexual harassment reportedduring the year under review.
37. LISTING OF SHARES
Company's shares are listed on Bombay Stock Exchange Limited. The company has paidannual listing fee for financial year 2016-17.
The Company's assets are adequately insured against the loss of fire and other risk asconsidered necessary by the Management from time to time. The Company has also takeninsurance cover for any claims/losses arising out of its core business of securitybroking.
39. BUSINESS RESPONSIBILITY REPORT:
The Business Responsibility Reporting as required by Regulation 34(2) of the SEBI(Listing Obligations & Disclosure Requirements) Regulations 2015 is not applicableto your Company for the financial year ending March 312016.
40. DEPOSITORY SYSTEM
Your Company's shares are tradable compulsorily in electronic form and your Company hasconnectivity with both the Depositaries i.e. National Securities Depository Limited (NSDL)and Central Depository Service (India) Limited (CDSL). In view of the numerous advantageoffered by the Depository System members are requested to avail of the facility ofDematerialization of the Company's shares on either of the Depositories mentioned asaforesaid.
41. INDUSTRIAL RELATIONS:
Company's Industrial relations continued to be healthy cordial and harmonious duringthe period under review.
42. AMENDMENT TO THE ARTICLES OF ASSOCIATION OF THE COMPANY
At the 23 rd Annual General Meeting held on 22nd September 2015based on the approval of the Members the Company adopted new Articles of Associationwhich had been streamlined and aligned with the Companies Act 2013 and Rules made thereunder.
The Board of Directors wish to place on record its appreciation for the extendedco-operation and assistance rendered to the Company and acknowledge with gratitude thecontinued support and cooperation extended by its employees investors stakeholdersBanks and other regulatory authorities. The board also like to thank BSE NSE NSDl &CDSL for their continuous support & co-operation.