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Continental Securities Ltd.

BSE: 538868 Sector: Financials
NSE: N.A. ISIN Code: INE183Q01012
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NSE 05:30 | 01 Jan Continental Securities Ltd
OPEN 6.60
PREVIOUS CLOSE 6.60
VOLUME 13500
52-Week high 6.82
52-Week low 6.50
P/E 132.00
Mkt Cap.(Rs cr) 2
Buy Price 6.60
Buy Qty 13500.00
Sell Price 6.60
Sell Qty 2100.00
OPEN 6.60
CLOSE 6.60
VOLUME 13500
52-Week high 6.82
52-Week low 6.50
P/E 132.00
Mkt Cap.(Rs cr) 2
Buy Price 6.60
Buy Qty 13500.00
Sell Price 6.60
Sell Qty 2100.00

Continental Securities Ltd. (CONTSECURITIES) - Director Report

Company director report

Your Directors have pleasure in presenting the 28th Annual Report together with Audited

Accounts for the year ended 31st March 2018.

FINANCIAL RESULTS

Rs in Lacs
Particulars Year Ended 31st March2018 Year Ended 31stMarch2017
Income 42.88 39.58
Total Expenditure 34.56 20.37
Profit before Interest Dep. And tax 8.32 16.76
Interest 0.02 0.45
Depreciation 1.91 3.64
Taxation 3.95 3.06
Net profit 2.44 9.61
Profit (Loss) brought forward 17.95 10.35
Net Profit (Loss) carried forward 17.80 17.95

DIVIDEND

No dividend was declared during the financial year 2017-18 as the company has utilizedor used its profits in other activities for promoting its business.

RESERVES

A sum of Rs. 1.41 Lacs has been transferred by company to Reserve out of which Rs.0.62Lacs has been transferred to Reserve Fund as per guidelines prescribed by Reserve Bank ofIndia.

Also a provision of Rs. 79296 @ .25% on the standard assets of the Company was madeduring the year.

OPERATIONS

During the year under review the Company has registered a gross income of Rs. 42.88Lacs as compared to the income of Rs. 39.58 Lacs in the previous year. The net profit ofthe company was Rs. 2.44 lacs as against net profit of Rs. 9.61 lacs in the previous year.

PROSPECTS

The year 2017-18 has seen downfall in some of the areas of the Indian economy. One ofthe major features of the fiscal year was the unfavorable financial market condition.However the company expect good performance even after stiff competition with bigplayers. The Company is still in process of consolidation and efforts are being made toenhance the net worth of the Company through renewed focus on core competence on Leasingand Investments. However the finance is major problem in expending the business of theCompany for which Company is making due efforts.

MANAGEMENT DISCUSSION AND ANALYSIS

This Management Discussion and Analysis Report is framed in compliance with theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015.

The Indian economy is now recovering and growth is on track. The financial position ofbanks and corporates have been deteriorated. There are numerous factors which may affectbusiness of finance companies . The performance of the company its profitability attitude of consumers etc. are some of them. Company is taking cautions view and formulatepolicies accordingly

1. Industry Structure and Developments.

India is not only among the world's fastest growing major economies underpinned by astable macro-economy with declining inflation and improving fiscal and external balancesrather it was also one of the few economies enacting major structural reforms. Thefinancial year 2017-18 has been marked by several historic economic policy developments.

Various other transformational reforms were also undertaken including Enactment of theInsolvency and Bankruptcy Act by Government of India which will encourage fast recovery ofbad loans made by NBFC'S

The Non Banking Financial Companies (NBFCs) have been complementing the banking sectorin reaching out credit to the un-banked segments of the society. The key to its growthlies in having in place adequate risk management systems and procedures before enteringinto risky areas. It is the constant endeavour of Reserve Bank of India (RBI) to enableprudential growth of the sector keeping in view the multiple objectives of financialstability consumer and depositor protection and need for more players in the financialmarket addressing regulatory arbitrage concerns while not forgetting the uniqueness ofNBFC sector.

2. Opportunities and threats.

The competition in the NBFC division is intensifying on account of rise innumber of players. Also rising stringent restrictions by the RBI on the NBFCs arerestricting their borrowing abilities. However as a matter of deliberate policy theReserve Bank has been discouraging NBFCs from engaging in public deposit mobilisationactivities. This is being done with a view to protecting depositors' interests and forfostering financial stability. Thus the opportunity of being a well regulatedparticipation the financial system is likely to outweigh the costs associated with greaterregulations in the long run. The opportunities of the Company further depends onintroduction of fresh funds.

3. Segment-wise or product-wise performance.

The Company is operating in one segment only .i.e making loans to the small borrowers.there is a slighty growth in the business of the Company The Company Is of the view thatthe financing business of the Companies of the NBFC will improve in future . The Companyis making due efforts to introduce new finance to enlarge its business.

4. Risks and concerns.

RISK MANAGEMENT

Company has implemented an integrated risk management approach through which it reviewsand assesses significant risk on a regular basis to ensure the there is a robust system ofrisk controls and mitigation in place.

Senior management periodically review the risk management. The management however ofthe view that no risk element is identified which in opinion of the board may threaten theexistence of the company.

The Risk Management Committee of the Company monitors and reviews the risk managementplan of the Company inaccordance with the Risk Management Policy of the Company.

RESERVE BANK OF INDIA

The Company has continued to follow all applicable guidelines issued by the Reservebank of India for NBFCs regarding Capital Adequacy Asset Classification provisioning andincome recognition on non-performing asset as applicable to category of NBFCs notaccepting Public Deposits.

DEPOSITS

The Company has not accepted any deposits within the meaning of the Companies(Acceptance of Deposits)Rules 2014 or Chapter v of the Companies Act2013 and guidelinesand directions of Non-Banking Financial Companies (Acceptance of Public Deposits )(Reserve Bank) Directions 2016 as prescribed by RBI in this regard and as such no detailsare required to be furnished..

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY THE COMPANY

Details of loans guarantees and investments if any covered under the provisions ofsection 186 of the Companies act 2013 are given in the notes to the financial statements.

SIGNIFICANT AND MATERIAL ORDERS

No significant or material order has been passed by the Regulators/Courts or Tribunalswhich can impact the going concern status and Company's operation in future.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There were no material changes occurred subsequent to the close of financial year ofthe company to which the balance sheet relates and the date of the report which can affectthe financial position of the Company

DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION PROHIBITIONAND REDRESSAL )ACT2013

The company has zero tolerance for sexual harassment at work places and has in place apolicy on prevention prohibition and redressal of sexual harassment at work place in theline of provisions of Sexual Harassment of women at work place (Prevention prohibitionand redressal )Act2013and the rules framed there under .

CORPORATE SOCIAL RESPONSIBILITY

Provisions of companies act 2013 relating to Corporate social responsibility does notapply to the company.

DOCUMENTS PLACED ON THE WEBSITE

(www.continentalsecuritiesltd.com)

The following documents have been placed on the website in compliance with the Act:

• Financial statements of the Company .

• Code of conduct for insider trading and corporate disclosure practices.

RELATED PARTY TRANSACTIONS:

All the related party transactions that were entered into during the financial yearwere on an arm's length basis and were in the ordinary course of business. There are nomaterial / significant related party transaction made by the Company which has a potentialconflict with the interest of the Company at large and disclosure is made at note No. 11of notes to the accounts annexed to the financial statements of the Company as required.The Board has framed a policy on related party transaction.

EXTRACTS OF ANNUAL RETURN:

Pursuant to section 134(3) and section92(3) of the Companies Act2013(hereinafterreferred as "Act") read with Rule 12 of the Companies (Management andAdministration ) Rules 2014 as amended an extract of Annual Return as on 31st March2018 in form MGT-9 has been prepared and enclosed as Annexure -Iwhich form part of thisreport.

STATUTORY AUDITORS

M/S Gopal Sharma & Co. Chartered Accountant Jaipur has been proposed forappointment as Statutory Auditors by Board of Directors for the Year 2018-19 at the forthcoming Annual General Meeting. The Remuneration of the said Auditors is proposed to befixed by The Board for each financial year based on recommendation of Audit Committee. Thesaid Auditor will be paid out of pocket expenses in connection with the audit . YourDirectors recommend their appointment as Statutory Auditors.

M/S B.L. Dusad & Company . Jaipur has resigned from Auditors work of the Company onaccount of being busy in other occupations.

The notes on Financial Statement referred to the Auditors Report are self explanatoryand do not call for further comments. The Auditors Report does not contain anyqualification reservation adverse remark or disclaimer

INTERNAL AUDITORS

M/S Ajay Khandelwal & Associates were appointed internal Auditors of the Companyfor the year ended 31st March 2018 under the provisions of Companies act2013 .TheCompany proposes to continue their services for the year 2018-19.

VIGIL MECHANISM

In Accordance of Section 177 of the Companies act 2013 the Company has constituted aWhistle Blower policy/ Vigil Mechanism to establish a vigil mechanism for the Directorsand employees to report genuine concerns in such manner as may be prescribed and to reportto the management instances of unethical behavior actual or suspected fraud or violationor violation of company's code of conduct.

RISK MANAGEMENT

Company has implemented an integrated risk management approach through which it reviewsand assesses significant risk on a regular basis to ensure that there is a robust systemof risk controls and mitigation in place.

Senior management periodically review the risk management. The management however ofthe view that no risk element is identified which in opinion of the board may threaten theexistence of the company.

INTERNAL CONTROL SYSTEM

The Company has an internal control system commensurate with the size and complexity ofoperations. The Company has appointed M/S Ajay Khandelwal& Associates Charteredaccountants Jaipur as internal auditors of the Company. The Audit committee has also takeneffective steps to review internal control system from time to time.

SECRETARIAL AUDITORS

Pursuant to provisions of Section 204 of the companies act 2013 M/S MKGP &Associates Company Secretaries Jaipur were appointed as Secretarial auditors of thecompany for the year ended 31st March 2018.The Secretarial Audit report submitted by themis annexed. The report does not contain any qualification.

DIRECTORS

Shri M.L Khandelwal Director of the Company is retiring by Rotation in ensuring AnnualGeneral Meeting and being eligible offers himself for appointment

Shri Suresh Gupta Director of the Company who is not liable to retire by Rotation inensuring Annual General Meeting and being eligible offers himself for appointment as anindependent Director

Shri Vishnu Dusad Director of the Company who is not liable to retire by Rotation inensuring Annual General Meeting and being eligible offers himself for appointment as anindependent Director

Smt. Ruchi Gupta Director of the Company who is not liable to retire by Rotation inensuring Annual General Meeting and being eligible offers herself for appointment as anindependent Director

Key Managerial Personnel

There was no change in the Key Managerial Personnel during the year under review.

BOARDS COMMITTEES:-

The Boards of Directors of the Company has constituted various Committees inCompliances with the Provision of the Companies and SEBI listing Regulations such asAudit Committee Nomination Remuneration and Compensation Committee Shareholder GrievanceCommittee.

All Decision pertaining to the constitution of the Committees appointment of membersand fixing of the terms of reference /role of the committees are taken by the Board ofDirectors.

AUDIT COMMITTEE

The Audit Committee comprises Independent Director namely Shri Suresh Kumar Gupta(Chairman) Shri Vishnu Dusad and MrsRuchi Gupta During the year all the recommendationmade by the Audit Committee were accepted by the Board.

Committee Meetings held during the year on 29th May 201708th August201714th November201712th February2018.

NOMINATION AND REMUNERATION COMMITTEE

The Board on the recommendation of the Nomination remuneration and compensationCommittee has adopted a policy for Selection appointment and remuneration of Directorskey Managerial personnel and Senior Management. Committee Meeting heldduring the year on04th JULY2017

SHARE TRANSFER COMMITTEE

The Share transfer Committee meeting comprises Independent Director namely Shri SureshKumar Gupta (Chairman) Shri Vishnu Dusad and MrsRuchi Gupta.During the year all therecommendation made by the Audit Committee were accepted by the Board.

Committee Meetings held during the year on 17th July 201704th August201725th August201715thFebruary2018.

MEETING OF BOARD OF DIRECTORS

The meetings of board of directors held during the year under review on10th APRIL201729th MAY 201704th JULY 201708th AUGUST 201726th AUGUST 201714th NOVEMBER201712th FEBRUARY 2018

INDEPENDENT DIRECTORS MEETING

During the year under reference one meeting of Independent directors was held on 12thFebruary 2018 in compliance with the requirement of Schedule IV of the Companies Act2013.At the said meeting performance of non-independent Directors Board as a whole andChairman of the Company was reviewed.

DECLARATION BY INDEPENDENT DIRECTORS:

The Company has obtained a declaration from independent Directors the said independentDirector meets the criteria of independence as mentioned in Section 149 (6) of theCompanies Act2013 and Schedule IV of the Companies Act 2013.

PREVENTION OF INSIDER TRADING

The Company has adopted a code of conduct for fair disclosure and prevention of insidertrading in order to regulate and control trading in securities by Directors and designatedemployees of the Company. The code requires pre-clearance for dealing in the Companyshares and prohibits the purchase and sales of Company shares by Directors and designatedemployees while in possession or unpublished price sensitive information in relation toCompany and during the period of closure of trading window.

(i) Demat/Remat of shares

No request was received for Remat during the financial year. Details of Demat asfollows;

a) Number of shares Dematerialized - 1830800

b) Percentage of Shares Dematerialized as on 31st March2018-56.32

(ii) Disclosures

a) There were no transactions of material nature with its related parties that may havethe potential conflict with the interest of the company at large. Transactions withrelated parties are disclosed in Note No 12 of the financial statements.

b) There were no instances of non compliance nor have any penalties imposed by StockExchanges or SEBI or any other statutory authority on any other matter related to capitalmarket during the last financial years.

c) Managing Director of the company has certified to the Board with regard to thecompliance made by them in terms of Clause 49 of the listing agreement and the certificateform part of this report.

Disclosures on Remuneration of Directors and Key Managerial Personnel

S.No Name of Director/KMP and its designation Remuneration (or Sitting Fees)to the Director/KMP for the Financial Year 2017-18 Percentage Increase/Decrease in remuneration in the Financial Year 2017-18 Ratio of Remuneration of each director to the Median Remuneration of Employees
1. Mr. M.L. Khandelwal (Chairman) 8250 83.33 0.084:1
2. Mr. Rajesh Khuteta 813440.00 51.48 8.37:1
3. Mr. Vishnu Dusad (Independent Director) 8250 83.33 0.084:1
4. Mr. Suresh Kumar Gupta (Independent Director) 8250 83.33 0.084:1
5. Mrs. Ruchi Gupta (Independent Director) 8250 83.33 0.084:1
6. Mr. J.C. Kedawat (Company Secretary) 240000 66.67 2.47:1
7. Mr. Hemant Gupta (C.F.O) 228000 5.55 2.35:1

a) Managing Director of the company has certified to the Board with regard to thecompliance made by them in terms of Clause 49 of the listing agreement and the certificateform part of this report.

REMUNERATION OF NON-EXECUTIVE/EXECUTIVE DIRECTORS

Details pertaining to remuneration as required under Section 197(12) of the companiesact 2013read with Rule 5 (1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) 2014 : *Only sitting fee is paid to Independent and non executive Directors.

i. The number of employees on the roll of the company are two.

ii. The median remuneration of employees( MRE ) of the Company is Rs.97125.00 .The MREfor the year is increased by 21.10 %compared to previous year.

iv. There is no variable component in remuneration of Directors of the Company.

v. The ratio of the remuneration of the highest paid director to that of the employeeswho are not Directors but receive remuneration in excess of the highest paid directorduring the year -None .

vi. It is hereby affirmed that the remuneration paid is as per the remuneration policyof the company.

Performance Evaluation as per Corporate Governance

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134 ((3) (c) of the Companies Act 2013yourDirectors state that :

1. That in preparation of the annual accounts for the financial year ended 31st March2018 the applicable accounting standards have been followed along with proper explanationrelating to material departures;

2. That they have selected such accounting policies and applied them consistently andmade 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 31stmarch 2018 and of the profit or loss of the Company for that period ;

3. That they have taken proper and sufficient care for the maintenance of properaccounting records in accordance with the provisions of the companies Act 2013 and rulesmade there under for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities.

4. That they have prepared the annual accounts for the financial year ended 31st March2018 on a going concern basis.The Directors had laid down internal financial controls tobe followed by the Company and that such internal financial controls are adequate and wereoperating effectively.

5. The directors had devised proper and systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively .

SUBSIDARIES/ ASSOCIATED COMPANIES

There is no subsidiary/associate of the company.

PARTICULARS REGARDING CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNING AND OUTGO

The information required under Section 134(3)(m) of the Companies Act 2013 relating toconservation of energy and technology absorption is not given since the Company is notengaged in manufacturing activity. The inflow and outgo of the foreign exchange was nilduring the year.

CORPORATE GOVERNANCE

As per to SEBI (Listing Obligation & Disclosure Requirements ) Regulations2015Company is not in perviewof Corporate governance regulation .Hence Corporate GovernanceReport is not enclosed with Directors Report

ACKNOWLEDGMENT

The Board would like to place on record its sincere appreciation to all the employeesfor their continued efforts towards the growth of the company. The Board also wishes toplace on record the support extended by its Bankers and the trust reposed in it by itsshareholders.

For and on behalf of the Board of Directors
PLACE: JAIPUR M.L. Khandelwal
DATE: 30th August 2018 Chairman