Your Directors present the 30th Annual Report and the Audited Accounts for theFinancial Year ended 31st March 2019.
The Financial performance of the Company for the Financial Year ended 31st March 2019is summarized below:
| ||(Rs. in Lakhs) |
|Particulars ||Year Ended 31.03.2019 ||Year Ended 31.03.2018 |
|Total Revenue ||428.44 ||675.96 |
|Profit before Interest || || |
|Depreciation & Tax ||38.66 ||165.56 |
|Profit before Depreciation and Tax ||38.66 ||165.56 |
|Depreciation ||12.14 ||13.76 |
|Profit Before Tax ||26.52 ||151.8 |
|Less: Provision for Tax (Net) ||4.83 ||33.29 |
|Profit After Tax ||21.69 ||118.51 |
|Add: Balance Brought Forward || || |
|from the last year ||1290.61 ||1183.96 |
|Profit available for Appropriation ||1312.30 ||1302.47 |
The Company's Profit after Tax is Rs. 21.69 Lakhs (Previous Year Rs. 118.51 Lakhs). TheBoard recommends transfer of a sum of Rs.2.16 Lakhs(Previous Year Rs. 11.86Lakhs) toGeneral Reserve.
Your Directors are pleased to recommend the payment of dividend on Equity Shares @ Rs.0.50 per share for the Financial Year ending 31-03-2019.
MATERIAL CHANGES AND COMMITMENTS
There were no material changes and commitments affecting the financial position of theCompany which have occurred between the end of the Financial Year of the Company to whichthe financial statements related and the date of this report.
FY18-19 was the year of record highs for the markets where the SENSEX and the NIFTYrallied 15% and 17% year over year respectively. However not all was green as volatilityplayed a pivotal role in shaping market direction during the year. In the beginning ofyear positive economic outlook for the Indian economy buoyed the markets as it continuedto be the best performer in the emerging market space. Notably India was largely oblivionto the global trade tensions that roiled other EMs given its domestic-consumption driveneconomy.
As such the S&P BSE Sensex ended the month of July 2018 at the then-all time highof 37606. The rally escalated further into August with the NIFTY gaining 14% betweenApril-August. However the highs were short-lived as markets took a sharp down turn inSeptember dented by fallout of India's leading infrastructure financing company. Thisraised concern over lack of liquidity in the NBFC space driving major sell-offs in peercompanies.
This along with rising interest rate environment in the U.S and a strengthening dollaragainst the rupee resulted in massive sell-off from the FIIs during the first half ofFY19. Notably they pulled out nearly $4 billion from Indian market during the period. Inaddition weak corporate governance primarily in the BFSI space and falling consumptiondemand kept investors at bay from select sectors.However India benefitted from theUS-China trade tensions a drop in crude prices and strong buying by domestic funds. Thishelped it in becoming the best performing market of Asia in CY2018.Nonetheless FIIsfuelled the markets in the end of FY19 by pumping in over $5 billion.
Markets commenced FY19-20 with continuation of the market rally witnessed in March.April and May saw extension of the rally as the incumbent government returned to powerfor a second term with a larger majority than the one witnessed in 2014. Going forwardthe current slowdown in auto sector which has led to production and plant shutdownsacross players like Maruti Bajaj Auto M&M Ashok Leyland and Tata Motors willcontinue to be tepid. However analysts expect to see gradual improvement in the secondhalf of FY20. Further demand for rural-related sectors like fertilizers and commercialvehicles (like tractors) will likely remain muted owing to deficient monsoon experiencedyear to date. FMCG companies with exposure to Tier 2 and 3 cities too will likelywitness subdued demand over the coming few quarters. In addition sectors like cement andinfrastructure are likely to perform well given government's focus on buildinginfrastructure and construction activities.
During the Financial Year 2018-19 the Share Capital of the Company has remainedunchanged
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in format MGT -9 for theFinancial Year 2018-19 has been enclosed with this report.
The same is also placed on the website of the Company www.cilsecurities.com
NUMBER OF BOARD MEETINGS
Four Board Meetings were held during the Financial Year 2018-19 which are as follows:22.05.2018 11.08.2018 03.11.2018 and 09.02.2019.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of Section 152 of the Companies Act 2013 Shri K KMaheshwari and Shri Piyush Modi retires by rotation at the ensuing Annual General Meetingand being eligible offer themselves for reappointment. The Board in its meeting held on25.05.2019 has approved the re-appointment of Shri K K Maheshwari as a Managing Directorfor a period of five years effective from 31st July 2019. The said appointment is subjectto the approval of members in the forthcoming Annual General Meeting through item no.5.
The Board in its meeting held on 25.05.2019 has approved the re-appointment of ShriBudhi Prakash Toshniwal and Shri F R Bhote as Independent Directors for a period of fiveyears (2nd Term) effective from 01st October 2019 to the Annual General Meeting to beheld in 2024. The said appointment(s) are subject to the approval of members in theforthcoming Annual General Meeting through item no.6 and 7.
POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION
(Includingcriteria for determining qualification positive attributes independence ofa director policy relating to remuneration for Directors Key Managerial Personnel andother employees)
Policy on Directors Appointment
Policy on Directors appointment is to follow the criteria as laid down under theCompanies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and good corporate practices. Emphasis is given to persons from diversefields or professions.
Policy on Remuneration
Guiding Policy on remuneration of Directors Key Managerial Personnel and employees ofthe Company is that -i Remuneration to Key Managerial Personnel Senior ExecutivesManagers and staff is industry driven in which it is operating taking into account theperformance leverage and factors such as to attract and retain quality talent. i ForDirectors it is based on the shareholders resolutions provisions of the Companies Act2013 and Rules framed therein circulars and guidelines issued by Central Government andother authorities from time to time.
ANNUAL EVALUATION BY THE BOARD OF ITS OWN PERFORMANCE ITS COMMITTEES AND INDIVIDUALDIRECTORS
The Board of Directors of the Company has initiated and put in place evaluation of itsown performance its committees and individual directors. The result of the evaluation issatisfactory and adequate and meets the requirement of the Company.
DECLARATION OF INDEPENDENCE BY THE INDEPENDENT DIRECTORS
Pursuant to Section 149(6) of the Companies Act 2013 Independent Directors of theCompany have made a declaration confirming the compliance of the conditions of theIndependence stipulated in the aforesaid section
REMUNERATION RATIO OF THE DIRECTOS / KEY MANAGERIAL PERSONNEL
The information required pursuant to Section 197 read with rule 5 of the Companies(Appointment and Remuneration) Rules 2014 and Companies (Particulars of Employees) Rules1975 in respect of employees of the Company and Directors is furnished hereunder:
A) Ratio of remuneration of each Director to the median remuneration of all theemployees of your Company for the Financial Year 2018-19 as follows:
|S.No ||Name ||Remuneration Paid in the FY 2018-19 in Rs. ||Ratio / Times per Median of employee remuneration |
|1 ||Shri Krishna Kumar Maheshwari ||1441496/- ||4.60 |
|2 ||Shri Piyush Modi ||600000/- ||1.91 |
|3 ||Shri Ashok Kumar Inani ||1337342/- ||4.26 |
The aforesaid details are calculated on the basis of remuneration for the FinancialYear 2018-19.
Median remuneration of the Company for all its employees is Rs 313398/- for theFinancial Year 2018-19.
B. Details of percentage increase in the remuneration of each Director and CFO andCompany Secretary in the Financial Year 2018-19 are as follows:
|Name ||Designation ||Remuneration in Rs. ||Increase % |
| || ||2018-19 ||2017-18 || |
|Shri Krishna Kumar Maheshwari ||Managing Director ||1441496/- ||1438190/- ||0.22 |
|Shri Piyush Modi ||Whole Time Director ||600000/- ||600000/- ||0.00 |
|Shri Ashok Kumar Inani ||Director Finance/ CFO ||1337342/- ||1242843/- ||7.60 |
|Shri Govind Toshniwal ||Company Secretary ||667011/- ||594902/- ||12.12 |
The remuneration to Directors is within the overall limits approved by theshareholders.
C. Percentage increase in the median remuneration of all employees in the FinancialYear 2018-19:
|Particulars ||2018-19 ||2017-18 ||Increase / (decrease)% |
|Median remuneration of all employees per annum ||Rs.313398/- ||Rs.287429/- ||9.03% |
D. Number of permanent employees on the rolls of the Company as on 31st March 2019 are29 and as on 31st March 2018 are 29.
E. Comparison of average percentage increase in salary of employees other than the keymanagerial personnel and the percentage increase in the key managerial remuneration:
| || || ||Amount in Rs. |
|Particulars ||2018-19 ||2017-18 ||Increase /(Decrease)% |
|Average Salary of all the Employees (Other than KMP) ||356282/- ||312532/- ||14.00% |
|Salary of Key Managerial Personnel || || || |
|Managing Director ||1441496/- ||1438190/- ||0.22% |
|Whole Time Director ||600000/- ||600000/- ||0.00% |
|Director Finance / CFO ||1337342/- ||1242843/- ||7.60% |
|Company Secretary ||667011/- ||594902/- ||12.12% |
The increase in remunerations of employees other than the managerial personnel is inline with increase in remuneration of managerial personnel
F. There are no employees of the Company who receive remuneration in excess of thehighest paid Director of the Company.
Pursuant to Rule 5(1)(xii) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 it is affirmed that the remuneration paid to the Directors KeyManagerial Personnel and senior management is as per the Remuneration Policy of theCompany.
The observations made in the Auditor's Report read together with the relevant notesthereon are self-explanatory and hence do not call for any comments.
M/s. Sridhar Jhawar & Associates Statutory Auditors of the Company hold officeuntil the conclusion of 33rd Annual General Meeting.
The Members in their Annual General Meeting held on 28.09.2017 have appointed M/sSridhar Jhawar and Associates Chartered Accountants as Statutory Auditors of the Companyto hold office for a period of 5 years until the conclusion of the Annual General Meetingto be held in the calendar year 2022.Ratification of their appointment by the members inevery Annual General Meeting (AGM) is done away by Companies Amendment Act 2017. Henceno resolution to this effect is proposed in the Notice calling AGM.
Raju and Prasad Chartered Accountants Hyderabad are the internal auditors of theCompany.
According to the provisions of section 204 of the Companies Act 2013 read with Rule 9of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theSecretarial Audit Report submitted by Company Secretary in Practice is enclosed as a partof this report
WHISTLE BLOWER / VIGIL MECHANISM POLICY
In pursuance to the provisions of section 177 of the Companies Act 2013 and SEBI(LODR)Regulations 2015 a Vigil Mechanism for Directors and Employees to report genuine concernshas been established. The Policy has been uploaded on the website of the Company.
RELATED PARTY TRANSACTIONS
Related Party transactions that were entered during the Financial Year were on an Arm'sLength Basis and were in the Ordinary Course of Business. There were no materiallysignificant related party transactions with the Company's Promoters Directors Managementand their relative which could have had a potential conflict with the interests of theCompany. Transactions with related parties entered by the Company in the normal course ofbusiness are periodically placed before the Audit Committee for its omnibus approval.
The Board of Directors of the Company has on the recommendation of the AuditCommittee adopted a policy to regulate transactions between the Company and its RelatedParties in compliance with the applicable provisions of the Companies Act. 2013 and rulesthereunder and the SEBI (LODR) Regulations 2015. This policy was considered and approvedby the Board and has been uploaded on the website of the Company.
PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIES PROVIDED
The Company has not given loans guarantee or provided securities. However aparticular of investments made is provided in Notes to Financial Statements in Note no. 2and 4.
The Company's shares are listed on BSE LIMITED.
The Company has paid up to date annual listing fee of the Stock Exchange
During the year under review the Company has not accepted any public deposits.
INTERNAL COMPLAINTS COMMITTEE
The Company has formed Internal Complaints Committee as per the provision of SexualHarassment Act (The Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 wherein it mandates for every workplace and every employer in chargeof a work place with more than 10 workers to constitute an Internal Complaints Committeeas prescribed under the Act for receiving complaints of sexual harassment.
The Company has not received any complaints
DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS:
Your Company has well established procedures for internal control across its variouslocations commensurate with its size and operations. The organization is adequatelystaffed with qualified and experienced personnel for implementing and monitoring theinternal control environment. The internal audit function is adequately resourcedcommensurate with the operations of the Company and reports to the Audit Committee of theBoard.
Adequate Insurance cover has been taken for properties of the Company includingBuildings Computers Office Equipment's Vehicles etc.
Particulars of Conservation of Energy Technology Absorption and Foreign ExchangeEarnings and Outgo Information under Section 134(3)(m) of the Companies Act 2013. TheCompany is not required to furnish information in Form A under the head 'Conservation ofEnergy' under Companies (Disclosure of Particulars in the Report of Board of Directors)Rules 1988.
The Company uses electric energy for its equipment's such as air conditioners computerterminals lighting and utilities in the work premises. All possible measures have beentaken for economic consumption and to conserve the same. Technologically updated UPSSystems have also been installed for proper service support. During the year under reviewthe Company does not have any Foreign Exchange earnings /outgo.
MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34 of SEBI (LODR) Regulations 2015 is presented in a separate sectionforming part of the Annual Report.
DIRECTORS RESPONSIBILITY STATEMENT
The Directors' Responsibility Statement referred to in clause (c) of sub-section (3) ofSection 134 of the Companies Act 2013 shall state that-
(a) In the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
(b) The directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year and ofthe profit of the company for that period;
(c) The directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
(d) The directors had prepared the annual accounts on a going concern basis; and
(e) The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
(f) The directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
The Company is committed to maintain the highest standards of Corporate Governance eventhough the same is not applicable to the Company.
The Company's shares are available for trading in depository systems of both theNational Securities Depository Limited (NSDL) and the Central Depository Services IndiaLimited (CDSL).
As on 24th May 2019 a total of 4909260 Equity shares of the Company which forms98.18% of the Share Capital of the Company stands dematerialized.
DEVELOPMENT AND IMPLEMENTAION OF RISK MANAGEMENT POLICY
The Company has been addressing various risks impacting the Company and the policy ofthe Company on risk management is provided in this report in Management discussions andAnalysis.
INVESTOR EDUCATION AND PROTECTION FUND (IEPF):
In terms of the provisions of the Companies Act the Company is obliged to transferdividends which remain unpaid or unclaimed for a period of seven years from the date ofdeclaration to the credit of the Investor education and Protection Fund established by theCentral Government. Accordingly the Members are hereby informed that the 7 years periodfor payment of the dividend pertaining to Financial Year 2011-2012 will expire on03.10.2019 and thereafter the amount standing to the credit in the said account will betransferred to the "Investor Education and Protection Fund" of the CentralGovernment.
The Due date for the transfer of Dividends to Investor Education and Protection Fund(IEPF) pertaining to previous Financial Years is given below:
|Financial Year ||Date of Declaration of Dividend ||Last Date of Claiming Dividend ||Due date for transfer to Investor Education and Protection Fund (IEPF) |
|2011-12 ||28.08.2012 ||03.10.2019 ||02.11.2019 |
|2012-13 ||30.09.2013 ||05.11.2020 ||04.12.2020 |
|2013-14 ||28.07.2014 ||02.09.2021 ||02.10.2021 |
|2014-15 ||15.09.2015 ||21.10.2022 ||20.11.2022 |
|2015-16 ||30.09.2016 ||05.11.2023 ||04.11.2023 |
|2016-17 ||28.09.2017 ||03.11.2024 ||02.12.2024 |
|2017-18 ||29.09.2019 ||04.11.2025 ||03.12.2025 |
COMPOSITION OF CSR COMMITTEE AND CONTENTS OF CSR POLICY
Since the Company does not have the net worth of Rs. 500 Crore or more or turnover ofRs. 1000 Crore or more or a net profit of Rs. 5 Crore or more during the Financial Yearsection 135 of the Companies Act 2013 relating to Corporate Social Responsibility is notapplicable and hence the Company need not adopt any Corporate Social ResponsibilityPolicy.
DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB SECTION (12) OF SECTION 143OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT
There have been no frauds reported by the auditors u/s 143(12).
DETAILS RELATING TO DEPOSITS COVERING THE FOLLOWING
Your Company has not accepted any deposits falling within the meaning of Sec.73 74& 76 of the Companies Act 2013 read with the Rule 8(v) of Companies (Accounts) Rules2014 during the Financial Year under review. Further there are no deposits which are notin compliance with the requirements of Chapter V of the Companies Act 2013.
SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS
During the period under review there were no significant and material orders passed bythe regulators or Courts or Tribunals impacting the going concern status and the company'soperations in future.
CODE OF CONDUCT FOR THE PREVENTION OF INSIDER TRADING
The Board of Directors has adopted the Insider Trading Policy in accordance with therequirements of the SEBI (Prohibition of Insider Trading) Regulation 2015 and theapplicable Securities laws. The Insider Trading Policy of the Company lays down guidelinesand procedures to be followed and disclosures to be made while dealing with shares of theCompany as well as the consequences of violation. The policy has been formulated toregulate monitor and ensure reporting of deals by employees and to maintain the highestethical standards of dealing in Company securities. The Insider Trading Policy of theCompany covering code of practices and procedures for fair disclosure of unpublished pricesensitive information and code of conduct for the prevention of insider trading isavailable on our website (www.cilsecurities.com)
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 the investors clients business associatesand bankers. The regulatory authorities have also put Indian Capital market on par withother international Markets. Your Directors also acknowledge the full-fledged cooperationand dedicated efforts put in by the employees across all levels in the organization andplace on record its appreciation for the services rendered.
|Registered office ||By Order of the Board of Directors of |
| ||CIL SECURITIES LMITED |
|214 Raghava Ratna Towers || || |
|Chirag Ali lane Abids ||K K Maheshwari ||A K Inani |
|Hyderabad-500 001 ||Chairman & Managing Director ||Director Finance/CFO |
|Place: Hyderabad ||DIN: 00223241 ||DIN: 00223069 |
|Date: 25.05.2019 || || |