Your Directors have pleasure in presenting the 39th Annual Report andAudited Accounts of your Company for the financial year ended March 31 2017.
The summarized performance of the Company for the financial year 2016-17 and 2015-16 isgiven below:
(Rs In lakh)
|Particulars || |
Centrum Capital Limited (Standalone)
Centrum Capital Limited (Consolidated)
| ||2016-17 ||2015-16 ||2016-17 ||2015-16 |
|Net revenue from operations ||2680.64 ||4519.85 ||686312.27 ||399472.54 |
|Add: Other income ||14250.35 ||592.86 ||13189.56 ||1184.42 |
|Total Income ||16930.99 ||5112.71 ||699501.83 ||400656.96 |
|Total expenditure before finance cost depreciation & Exceptional items and taxes ||8780.32 ||2897.95 ||685280.72 ||393087.55 |
|Profit before finance cost depreciation exceptional items and taxes ||8150.67 ||2214.76 ||14221.10 ||7569.41 |
|Less: Finance costs ||3782.77 ||1784.35 ||5967.60 ||2842.15 |
|Profit before depreciation exceptional items and taxes ||4367.90 ||430.41 ||8253.39 ||4727.26 |
|Less: Depreciation ||258.91 ||246.70 ||664.64 ||459.19 |
|Profit before exceptional items and taxes ||4108.99 ||183.71 ||7588.75 ||4268.07 |
|Add/(Less): Exceptional items ||- ||665.93 ||- ||665.93 |
|Profit before taxes ||4108.99 ||849.64 ||7588.75 ||4934.00 |
|Less: Provision for current taxation ||630.00 ||292.00 ||3303.42 ||2133.20 |
|Less : Provision for MAT credit ||(630.00) ||- ||(668.10) ||(224.49) |
|Less: Provision for deferred taxation ||356.87 ||(52.78) ||386.63 ||(97.89) |
|Profit/ (Loss) after taxes available for appropriation ||3752.12 ||610.43 ||4566.81 ||3123.18 |
|Less: Minority Interest ||- ||- ||1565.40 ||507.26 |
|Balance to be carried forward ||3752.12 ||610.43 ||3001.41 ||2615.92 |
Financial Year 2015-16 was of nine months from July 01 2015 to March 31 2016 andtherefore the figures are not comparable
Financial Performance and State of Company affairs
Information on the operational and financial performance of the Company is given in theManagement Discussion and Analysis Report which is annexed to the Report and is inaccordance with SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015("Listing Regulations").
Consolidated Financial Statements
As per Regulation 33 of the Listing Regulations and applicable provisions of theCompanies Act 2013 read with the Rules issued thereunder the Consolidated FinancialStatements of the Company for the financial year 2016-17 have been prepared in compliancesof the applicable Accounting Standards and on the basis of audited financial statements ofthe Company its subsidiaries and associated companies as approved by the respectiveBoard of Directors.
During the period under review there has been no change in the authorized as well aspaid up share capital of the Company.
During the period under review your Company has redeemed 4998 Non-ConvertibleDebentures of ` 100000/- (Rupees One Lakh) amounting to ` 499800000 (Rupees Forty NineCrore Ninety Eight Lakh Only) which were issued through private placement.
Further during the period under review your Company has raised an amount of ` 930/-lakh through private placement by way of issue of secured unlisted unrated redeemabledebentures non-convertible principle protected market linked debentures bearing a facevalue of ` 100000 /- each.
Management Discussion and Analysis
The Management Discussion and Analysis forms an integral part of this Report and givesdetails of the overall industry structure economic developments performance and state ofaffairs of your Company's various businesses internal controls and their adequacy riskmanagement systems and other material developments during the financial year 2016-17.
Transfer to Reserves
No transfers were made to the General Reserve. An amount of ` 23250000 has beentransferred to Debenture Redemption Reserve .
Your Directors recommend a dividend for the financial year ended March 31 2017 of `0.05 per equity share of ` 1 each to the equity shareholders of the Company. The dividendpayment is subject to approval of the shareholders at the ensuing Annual General Meeting.
Material Changes and Commitments
There are no material changes and or commitments a_ecting the financial position of theCompany between the end of the financial year i.e. March 31 2017 and the date of theReport.
Corporate Governance Report
The Company evolve and follow the corporate governance guidelines and best practicessincerely to not just boost long-term shareholder value but also to respect minorityinterest. We consider it our inherent responsibility to disclose timely and accurateinformation regarding financials and performance as well as leadership and governance ofthe Company.
In compliance with Regulation 34 of the Listing Regulations a separate report onCorporate Governance along with a certificate from the Auditors on its compliance forms anintegral part of this Report.
At present the Company's Equity shares are listed on BSE Limited and the Company haspaid listing fees upto the financial year 2017-18.
Number of meetings of the Board and its Committees
The details of the meetings of the Board of Directors and its Committees convenedduring the financial year 201617 are given in the Corporate Governance Report whichforms a part of this Report.
Selection of New Directors and Board Membership Criteria
The Nomination and Remuneration Committee works with the Board to determine theappropriate characteristic skills and experience for the Board as a whole and itsindividual members with the objective of having a Board with a diverse background andexperience in business. Characteristic expected of all Directors include independenceintegrity high personal and professional ethics sound business judgment ability toparticipate constructively in deliberation and willingness to exercise authority in acollective manner. The Policy regarding the same is provided in Annexure A to thisReport.
Nomination and Remuneration Policy
The Company has in place a Nomination and Remuneration Policy for the Directors KMPand other employees pursuant to the provisions of the Companies Act 2013 and the ListingRegulations which is set out in Annexure B which forms part of the this Report.
Familiarisation Programme for Independent Directors
In terms of Listing Regulations the Company is required to familiarize its IndependentDirectors (IDs) with their roles rights and responsibilities in the Company etc. throughinteractions and various programmes.
The Independent Directors are also required to undertake appropriate induction andregularly update and refresh their skills knowledge and familiarity with the Company interms of Schedule IV of the Companies Act 2013.
The Policy on the Company's Familiarisation Programme for IDs is available atwww.centrum.co.in
Pursuant to the provisions of the Companies Act 2013 read with the Rules issued thereunder and the Listing Regulations (including any statutory modification(s) orreenactment(s) for _the time being in force) the process for evaluation of theannual performance of the Directors/ Board/ Committees was carried out.
The criteria applied in the evaluation process are detailed in the Corporate GovernanceReport which forms part of this Report. In a separate meeting of Independent Directorsevaluation of the performance of Non-Independent Directors performance of Board as awhole and performance of the Chairman was done after taking into account views ofExecutive and Non-Executive Directors.
Declaration by Independent Directors
The Company has received declarations from all the Independent Directors confirmingthat they meet the criteria of independence as prescribed under the provisions of theCompanies Act 2013 read with the Schedules and Rules issued thereunder as well asRegulation 16(1)(b) of Listing Regulations (including any statutory modification(s) orreenactment(s) for the time being in force).
Independent Directors' Meeting
A meeting of Independent Directors was held on February 09 2017 as per schedule IV ofthe Companies Act 2013.
Directors and Key Managerial Personnel
During the financial year Mr. Jaspal Singh Bindra was appointed as an ExecutiveChairman with effect from (w.e.f.) April 21 2016.
Mr. Manmohan Shetty was designated as Independent Director w.e.f. August 05 2016.
Mr. K. R. Kamath and Mr. Vivek Vig were regularized as Non- Executive Directors w.e.f.September 30 2016.
There was no instance for resignation of Director during the financial year underreview.
Key Managerial Personnel
Mr. Shailendra Apte is the Chief Financial Officer (CFO) of the Company and Mr. AlpeshShah is the Company Secretary of the Company.
Directors' Responsibility Statement
Pursuant to Section 134 of the Companies Act 2013 (including any statutorymodification(s) or reenactment(s) for the time being in force) the Directors ofyour Company confirm that:
(a) in the preparation of the annual accounts for the financial year ended March 312017 the applicable Accounting Standards and Schedule III of the Companies Act 2013(including any statutory modification(s) or reenactment(s) for the time being inforce) have been followed and there are no material departures from the same;
(b) 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 your Company as at March 31 2017 and of the profitand loss account of the Company for the financial year ended March 31 2017;
(c) proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies
Act 2013 (including any statutory modification(s) or reenactment(s) for the timebeing in force) for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities;
(d) the annual accounts have been prepared on a going concern' basis;
(e) proper internal financial controls laid down by the Directors were followed by yourCompany and that such internal financial controls are adequate and operating effectively;and
(f) proper systems to ensure compliance with the provisions of all applicable laws werein place and that such systems were adequate and operating effectively.
The primary objective of the Audit Committee is to monitor and provide effectivesupervision of the Management's financial reporting process to ensure accurate and timelydisclosures with the highest levels of transparency integrity and quality of financialreporting.
The Committee met 4 (four) times during the period under review the details of whichare given in the Corporate Governance Report that forms part of this Annual Report. As onMarch 31 2017 the composition of the Audit Committee was as follows:
|Sr. No. ||Name ||Category ||Designation in Committee |
|1 ||Mr. Rajesh Nanavaty ||Independent Director ||Chairman |
|2 ||Mr. Subhash Kutte ||Independent Director ||Member |
|3 ||Mr. Rishad Byramjee ||Non-Executive Director ||Member |
|4 ||Mr. R.S Reddy ||Non-Executive Director ||Member |
The recommendation of Audit Committee given from time to time were considered andaccepted by the Board.
Related Party Transactions
All related party transactions that were entered during the financial year under reviewwere on an arm's length basis and were in the ordinary course of business. There were nomaterially significant related party transactions made by the Company with PromotersDirectors Key Managerial Personnel or other designated persons which may have a potentialconflict with the interest of the Company at large.
Accordingly particulars of contracts or arrangements with related party referred to inSection 188(1) of the Companies Act 2013 along with the justification for entering intosuch contract or arrangement in Form AOC-2 does not form part of the Report.
Disclosure of Internal Financial Controls
The internal financial controls with reference to financial statements as designed andimplemented by the Company are adequate. During the financial year under review nomaterial or serious observations have been received from the Internal Auditors of theCompany for inefficiency or inadequacy of such controls.
Risk Management Policy
The Company has Risk Management Policy and Guidelines in place which identify allmaterial risks faced by the Company.
With ups and downs volatility and fluctuations in the financial business in which theCompany operates Company is exposed to various risks and uncertainties in the normalcourse of business. Since such variations can cause deviations in the results fromoperations and a_ect the financials of the Company the focus on risk management continuesto be high.
Centrum's risk management strategy has product neutrality speed of trade executionreliability of access and delivery of service at its core. Multiple products and diverserevenue streams enable the Company to ensure continued offering of customized solutions tosuit clients needs at all times.
Energy Conservation Measures Technology Absorption and R & D efforts and ForeignExchange Earnings and Outgo
In view of the nature of activities being carried out by the Company the disclosureconcerning energy conservation measures technology absorption and R & D efforts arenot applicable to the Company.
The details of foreign exchange earnings and outgo during the period under review areprovided at Item No. 33 (Notes forming part of financial statements) of the AuditedAccounts. The members are requested to refer to the said Note for details in this regard.
Subsidiaries Joint Ventures and Associates
A separate statement containing the salient features of financial statements of allsubsidiaries of your Company forms part of consolidated financial statements in compliancewith Section 129 and other applicable provisions if any of the Companies Act 2013.Company has Eighteen (18) Subsidiaries (including step down Subsidiaries) three (3) JointVentures and two (2) Associate Companies as on March 31 2017. Further the Report on theperformance and financial position of each of the subsidiary associate and joint ventureand salient features of the financial statements in the prescribed form AOC-1 is annexedto this Report (Annexure C)
The Company's step-down subsidiary company Centrum Financial Services Limited (CFSL)has acquired 99% stake in Agrata Mercantile Private Ltd. on April 21 2016.
Consequently Shree Srinivas Realtors Private Limited a 100% subsidiary company ofAgrata Mercantile Private Ltd. has also become step-down subsidiary of Centrum FinancialServices Limited.
During the financial year under review following changes can be noted with respected tosubsidiaries Joint Ventures & Associates.
The Company divested its 32.5% equity stake in Buyforex India Limited to CentrumDirectLimited a step-down subsidiary company.
Centrum Wealth Management Limited a stepdown subsidiary company of the Companyincreased its equity stake from 12.5% to 25% in Indian Property Advisors LLP w.e.f. March24 2017.
Buyforex India Limited a subsidiary company has purchased 100% equity stake in Krish& Ram Forex Private Limited thus Krish & Ram Forex Private Limited has become thestep-down subsidiary of the Company w.e.f. January 27 2017.
Centrum Retail Services Limited a subsidiary of the company has purchased 100% equitystake in Centrum Microcredit Private Limited (CMPL) formerly known as Nobita TradingPrivate Limited and thus Centrum Microcredit Private Limited (CMPL) has become a step-downsubsidiary company w.e.f. March 22 2017. CMPL has applied to RBI for NBFC MFI Licenseafter the financial year ended March 31 2017.
Centrum Retail Services Limited has divested its 14.89 % stake in CentrumDirect Limitedto NYLIM Jacob Ballas India Holdings IV and Jacob Ballas Capital India Private Limitedduring the financial year ended March 31 2017.
CentrumDirect Limited a step down subsidiary Company purchased an additional 4.97%equity stake in Pyxis Finvest Limited (NBFC). Thus the equity stake in Pyxis FinvestLimited (NBFC) has increase to 57.13% from 52.16%.
Auditors and Auditors Report
i. Statutory Auditors
The members of the Company at the 36th Annual General Meeting of the Companyheld on December 31 2014 had reappointed M/s. Haribhakti & Co. LLP CharteredAccountants as Statutory Auditors till the conclusion of the 41st AnnualGeneral Meeting of the Company to be held in the year 2019 subject to ratification oftheir appointment at every Annual General Meeting.
A resolution for the ratification of the appointment of M/s. Haribhakti & Co. LLPChartered Accountants as Statutory Auditors is being proposed for the approval of themembers at the forthcoming Annual General Meeting.
With regards to the Emphasis of Matter in the Auditors' Report _we wish to submit _as_under:
a) Based on the financial estimates and business rationale provided by the managementfor its exposure in Centrum Infrastructure Advisory Limited (CIAL) Centrum DefenceSystems Limited (CDSL) and Centrum Capital holding LLC (CCH LLC) confirming fair valuationhigher than the cost of investment of ` 5 Lakh in CIAL ` 5 Lakh in CDSL and ` 194.28 lakhin CCHLLC the management believes that there is no impairment in the above investmentsalong with loans advanced amounting to ` 289.64 Lakh to CIAL ` 183.13 Lakh to CDSL and `63.91 Lakh to CCH LLC.
b) Company has paid a managerial remuneration in excess of the limits as laid down inSection 197 of the Companies Act 2013 read with Schedule V to the Act during thefinancial year 2016-17 to its Executive Chairman. The Company has made an application tothe Central Government in Form No MR-2 pursuant to the provisions of Section 196 197 andSchedule V to the Companies Act 2013 seeking its approval for the same. The CentralGovernment has partially allowed excess remuneration and the Company has made arepresentation for the balance amount.
ii. Secretarial Audit
The Board had appointed Mr. Umesh P. Maskeri Company Secretary in Practice asSecretarial Auditor to conduct secretarial audit for the financial year ended March 312017. In pursuant to the provisions of Section 204 of the Companies Act 2013 read withRules 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014. The report of the Secretarial Auditor is provided as Annexure D to thisReport. In connection with the Auditor's observation in the report it is clarified asunder:
a) Company is planning to spend the CSR expenditure through Trust and in this processthe Company has identified the Trust and the CSR expenditure will be spend in near future
b) During the financial year under review efforts were made by the Company to findindependent directors with relevant experience commensurate with the business and size ofthe Company. During the financial year Mr. Manmohan Shetty was designated as IndependentDirector. Considering resignations submitted by Mr. Vivek Vig and Mr. Pankaj Thapar bothNon-Executive Directors on May 29 2017. The Company now fulfills the criteria ofcomposition of Directors under Regulation 25 of the Listing Regulations.
c) Company has paid a managerial remuneration in excess of the limits as laid down inSection 197 of the Companies Act 2013 read with Schedule V to the Act during thefinancial year 2016-17 to its Executive Chairman. The Company has made an application tothe Central Government in Form No MR-2 pursuant to the provisions of Section 196 197 andSchedule V to the Companies Act 2013 seeking its approval for the same. The CentralGovernment has partially allowed excess remuneration and the Company has made arepresentation for the balance amount.
Vigil Mechanism/ Whistle Blower Policy
The Company has a Whistle Blower Policy/Vigil Mechanism for employees to report genuineconcerns/grievances if any. The Policy is uploaded on the Company's websitewww.centrum.co.in. The Policy provides for adequate safeguards against the victimisationof the employees who use the vigil mechanism. The vigil mechanism is overseen by the AuditCommittee.
Particulars of Employees and Remuneration
The information required pursuant to Section 197 read with Rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 with respect of theemployees of the Company is enclosed herewith as Annexure E.
Extract of Annual Return
The details forming part of the extract of the Annual Return as on March 31 2017 inForm MGT 9 in accordance with Section 92(3) of the Companies Act 2013 read withCompanies (Management and Administration) Rules 2014 are set out as_Annexure F_tothis Report.
Particulars of Loans Guarantees and Investments
Details of loans guarantees and investments under the provisions of Sections 134(3)(g)and 186(4) of the Companies Act 2013 read with the Companies (Meetings of Board and itsPowers) Rules 2014 as on March 31 2017 are set out in Note 43 to the StandaloneFinancial Statements.
Disclosure as per Sexual Harassment of women at work place (Prevention Prohibition andRedressal) Act 2013
The Company is committed to provide a healthy environment to all its employees and haszero tolerance for sexual harassment at workplace. In order to prohibit prevent andredress complaints of sexual harassment at workplace the Company has constituted aComplaint Committee in line with the provision of Section 4(1) of the Sexual Harassment ofWomen at workplace ( Prevention Prohibition and Redressal) Act 2013.
Details as per SEBI (Share Based Employee Benefits) Regulations 2014
The following are the details relating to Trust as per SEBI (Share Based EmployeeBenefits) Regulation 2014:
|Sr. No ||Particulars ||Details |
|1 ||Name of the Trust ||Centrum ESPS Trust |
|2 ||Details of the Trustee(s) ||1) Mr. Rajendra Naik and 2) Mr. Ajay Sharma. |
|3 ||Amount of loan disbursed by the Company/any company in the group during the year ||NIL |
|4 ||Amount of loan outstanding (repayable to Company/any company in the group) as at the end of the year. ||NIL |
|5 ||Amount of the loan if any taken from any other source for which company/any company in the group has provided any security or guarantee. ||NIL |
|6 ||Any other contribution made to the Trust during the year. ||NIL |
ii) Brief Details of transactions held by the Trust:
|Sr. No ||Particulars ||Details |
|1 ||Number of shares held at the beginning the year ||24581160 |
|2 ||Number of shares acquired during the year through (i) primary issuance (ii) secondary issuance also as a percentage of paid up equity capital as at the end of the previous financial year along with information or weighted average cost of acquisition per share. ||NIL |
|3 ||Number of shares transferred to the employees/sold along with the purpose thereof. ||NIL |
|4 ||Number of the share held at the end of the year. ||24581160 |
There was no secondary acquisition of shares by Trust.
The scheme is in the process of implementation.
Company has not issued any employee stock option and hence no information has beenfurnished under Rule 12(9) of Companies (Share Capital and Debentures) Rules 2014 andRegulation 14 of Securities and Exchange Board of India (Share Based Employee Benefit)Regulations 2014.
There were no instance of non-exercising of voting rights in respect of sharespurchased directly by the employees under a scheme pursuant to Section 67(3) of theCompanies Act 2013 read with Rule 16(4) of Companies (Share Capital and Debenture) Rules2014 and hence no information has been furnished.
Corporate Social Responsibility (CSR)
The Annual Report on CSR activities as required under Section 134(3)(O) of theCompanies Act 2013 read with Rule 8 of the Companies (CSR Policy) Rules 2014 is set outin Annexure G to this Report and is also accessible on Company website athttp://www.centrum.co.in.
During the year under review your Company has not accepted any deposit within themeaning of Sections 73 and 74 of the Companies Act 2013 read with the Companies(Acceptance of Deposits) Rules 2014.
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.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions pertaining to these items during the periodunder review.
1. Issue of equity shares with differential rights as to dividend voting or otherwise.
2. There was no revision in financial statements.
3. Company has not issued any sweat equity shares.
4. There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status of the Company's operations in future.
Human Resource and Employee Relationship
There is an ongoing emphasis on building a progressive human resources culture withinthe organization. Structured initiatives that foster motivation team work andresult-orientation continue to be addressed.
Disclosures with respect to demat suspense account/ unclaimed suspense account
The Company has no shares lying in demat suspense account or unclaimed suspenseaccount.
All the Policies including the following policies framed by the Company as per theCompanies Act 2013 and Listing Regulations are uploaded on the Company's website and areavailable at http://www.centrum.co.in/investor-relation/#1465210010845-d7050339-33a6.
Nomination and Remuneration Policy
Remuneration criteria for Non-Executive Directors
Related Party Transaction Policy
Familiarisation Programme for Independent Directors
Policy on determining Material Subsidiaries
Statements in the Directors' Report and the Management Discussion & Analysisdescribing the Company's objectives expectations or forecasts may be forward-lookingwithin the meaning of applicable securities laws and regulations. Actual results maydiffer materially from those expressed in the statement. Important factors that couldinfluence the Company's operations include global and domestic demand and supplyconditions changes in government regulations tax laws economic developments within thecountry and such other factors that may a_ect the markets/industry in which the companyoperates.
Your Directors wish to convey their gratitude and place on record their appreciationfor all the employees at all levels for their hard work solidarity cooperation anddedication during the year.
Your Directors sincerely convey their appreciation to customers shareholders vendorsbankers business associates regulatory and government authorities for their continuedsupport.
For and on Behalf of the Board of Directors For Centrum Capital Limited
|Jaspal Singh Bindra ||Chandir Gidwani |
|Executive Chairman ||Non- Executive Director |
|DIN: 07496596 ||DIN: 00011916 |
|Place: Mumbai || |
|Date: May 29 2017 || |