The members of Essar Securities Limited ("the Company")
The Directors present the 16th Annual Report of the Company together withAudited Financial Statements for the financial year ended March 31 2021.
1. FINANCIAL SUMMARY
The financial highlights for the year under review are given below:
(Rs. in lakhs)
|Particulars ||Year ended March 31 2021 ||Year ended March 31 2020 |
|Revenue from Operations ||- ||- |
|Other Income ||23.00 ||0.32 |
|Total Income ||23.00 ||0.32 |
|Less: Total Expense ||21.45 ||17.35 |
|Profit/(Loss) before tax ||1.55 ||(17.03) |
|Less: Tax Adjustments of Earlier year ||- ||(1.58) |
|Profit/(Loss) after tax ||1.55 ||(18.61) |
|Total Comprehensive Income for the year ||1.55 ||(18.61) |
2. FINANCIAL PERFORMANCE & STATE OF COMPANY'S AFFAIRS
During the year under review the total income of the Company was Rs. 23.00 lakhs asagainst ' 0.32 lakhs in the previous financial year. The Company has incurred net profitof Rs. 1.55 lakhs as against net loss of Rs. 18.61 lakhs in the previous financial year.
The Company's performance and outlook for the year under review has been discussed indetail in Management Discussion and Analysis which forms a part of this Report.
3. AMOUNT TRANSFERRED TO RESERVES
The Directors do not propose to transfer any amount to reserves for the financial yearended March 31 2021.
4. SHARE CAPITAL
There was no change in the capital structure of the Company during the financial yearunder review. The paid up share capital as on March 31 2021 was Rs. 142877540/-comprising of 14287754 Equity Shares of Rs. 10/- each.
The Directors do not recommend any dividend for the financial year ended March 312021.
6. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)
Mr. Somashekhar B. Malagi (DIN:07626139) and Mr. Srikanth R. Venkatadriagaram(DIN:07923382) are continues to be Independent Directors of the Company.
Retirement by Rotation
Ms. Priyanka Oka retires by rotation and being eligible officers herself forre-appointment. A resolution seeking members' approval for her re-appointment forms partof the Notice.
Key Managerial Personnel (KMP)
Ms. Rachana H Trivedi - Company Secretary and Compliance Officer
7. DECLARATION FROM INDEPENDENT DIRECTORS
All the Independent Directors have given their respective Declaration of Independenceas required under Section 149(7) of the Companies Act 2013 stating that they meet thecriteria of independence as specified in Section 149(6) of the Companies Act 2013 andRegulation 16(1)(b) of Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 ('the Listing Regulations'). In the opinion ofthe Board they fulfil the conditions of independence as specified in the Act and theListing Regulations and are independent of the management.
8. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS
The Board met 5 (Five) times during the year under review. The details of Boardmeetings held and attendance of the Directors are provided in the Corporate GovernanceReport forming part of this Report.
9. AUDIT COMMITTEE
The Board has constituted an Audit Committee comprising of Mr. Somashekhar B. Malagi asChairman Ms. Priyanka Oka and Mr. Srikanth Rajamani Venkatadriagaram as its members.
The Board accepted the recommendations of the Audit Committee whenever made by theCommittee during the year.
10. NOMINATION AND REMUNERATION COMMITTEE
The information pertaining to Nomination and Remuneration Committee is furnished in theCorporate Governance Report which forms part of this Report.
11. COMPANY'S POLICY RELATING TO DIRECTORS' APPOINTMENT PAYMENT OF REMUNERATION ANDDISCHARGE OF THEIR DUTIES
The Company has adopted Nomination and Remuneration Policy for identificationselection and appointment of Directors Key Managerial Personnel and Senior ManagementPersonnel of the Company. The Policy provides criteria for fixing remuneration of theDirectors Key Managerial Personnel and Senior Management Personnel of the Company. ThePolicy enumerates the powers roles and responsibilities of the Nomination andRemuneration Committee. The Nomination and Remuneration Policy is appended to this reportas Annexure A.
12. MANAGERIAL REMUNERATION AND OTHER DETAILS
The information required under Section 197(12) of the Companies Act 2013 read withRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 is furnished in the Annexure B to this report.
13. EVALUATION OF THE PERFORMANCE OF THE BOARD
In terms of the provisions of the Companies Act 2013 and the SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 the annual evaluation of the performanceof the Board its Committees and of individual Directors was carried out with a structuredquestionnaire covering various aspects of the Board functioning such as composition of theBoard and its Committees Board culture execution and performance of specific dutiesobligations and governance.
A separate exercise was carried out to evaluate the performance of individualDirectors who were evaluated on factors such as level of participation independence ofjudgement interpersonal relationship etc. On the basis of evaluation exercise the Boardis of the view that the Board and its Committees operate effectively.
14. VIGIL MECHANISM
The Company has adopted a Whistle Blower Policy to provide a formal mechanism to theDirectors and employees to report their concerns about unethical behavior actual orsuspected fraud or violation of the Company's Code of Conduct. The Policy provides foradequate safeguards against victimization of employees who avail of the mechanism and alsoprovides for direct access to the Chairman of the Audit Committee. It is affirmed that nopersonnel of the Company have been denied access to the Audit Committee. The Policy isavailable on the website of the Company at www.essar.com.
15. DIRECTORS' RESPONSIBILITY STATEMENT:
In terms of Section 134(5) of the Companies Act 2013 the Directors to the best oftheir knowledge state that:
a) in the preparation of the annual accounts for the financial year ended March 312021 the applicable accounting standards have been followed along with proper explanationrelating to material departures;
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 the Company at the end of the financial year March31 2021 and of the profit of the Company for that period;
c) the directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d) the directors have prepared the accounts for the financial year ended March 31 2021on a going concern basis;
e) the directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; ands
f) the directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively;
16. CHANGE IN NATURE OF BUSINESS IF ANY
There was no change in the nature of business of the Company during the financial yearended March 31 2021.
17. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There were no material changes and commitments affecting the financial position of theCompany occurred between the end of the financial year to which this Financial Statementsrelate and on the date of this Report.
18. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN ExCHANGE EARNINGS AND OUTGO
Considering the nature of business of the Company the information required underSection 134 (3)(m) of the Companies Act 2013 read with Companies (Accounts) Rules 2014relating to conservation of energy and technology absorption is not applicable. There wereno foreign exchange earnings or outgo during the period under review.
19. DISCLOSURE UNDER THE SExUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION & REDRESSAL) ACT 2013
There are no women employees in the Company. Accordingly the said provisions are notapplicable to the Company.
20. CORPORATE SOCIAL RESPONSIBILITY
The provisions of Section 135 of the Companies Act 2013 are not applicable to theCompany.
21. LOANS GUARANTEES SECURITIES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIESACT 2013
The Company has not provided any loans guarantees securities or made investmentscovered under Section 186 of the Companies Act 2013.
22. RELATED PARTIES TRANSACTIONS
In line with the requirements of the Companies Act 2013 and Listing Regulations theCompany has formulated a Policy on Related Party Transactions which is available onCompany's website at www.essar.com.
There were no material related party transactions entered into by the Company duringthe financial year under review. The Company has not entered into any transactions withrelated parties which were not in its ordinary course of business or not on an arm'slength basis. Accordingly the disclosure of related party transactions as required underSection 134(3) (h) of the Companies Act 2013 in Form AOC-2 is not Required to yourCompany.
During the year under review the Company has not accepted any deposits within themeaning of Chapter V of the Companies Act 2013 read with the Companies (Acceptance ofDeposits) Rules 2014.
M/s. D K S K & Company Chartered Accountants (Firm Registration No. 017224S) wereappointed as the Statutory Auditors of the Company at the 12'h Annual GeneralMeeting (AGM) of the Company held on September 29 2017 to hold office from the conclusionof the 12th AGM till the conclusion of the 17th AGM to be held inthe year 2022 subject to ratification of their appointment by the members every year.
The Ministry of Corporate Affairs vide its Notification dated 7'h May 2018has dispensed with the requirement of ratification of Auditor's appointment by the membersevery year. Accordingly the resolution relating to ratification of Auditor's appointmentis not included in the Notice of the ensuing Annual General Meeting.
Statutory Auditors' Report
The Auditors' Report for the financial year ended March 31 2021 do not contain anyqualification or reservation or adverse remark.
There were no frauds reported by the Auditors under the provisions of Section 143(12)of the Companies Act 2013.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 Uma Lodha (MembershipNo. FCS 5363) Prop. M/s. Uma Lodha & Co. Associates Practising Company Secretarieswere appointed as the Secretarial Auditors to carry out the secretarial audit of theCompany for the financial year 2020-21.
Secretarial Audit Report
A Secretarial Audit Report given by the Secretarial Auditors in Form No. MR-3 isannexed with this Report as Annexure C. There are no qualifications reservationsor adverse remarks made by Secretarial Auditors in their Report. However there are fewobservations made by Secretarial Auditors. The below are the replies to the observationsmade by Secretarial Auditors:
Reply to observation 1 & 3:
The Company has made efforts to appoint KMPs as requirement under section 203 (1) and203(3) of the Companies Act 2013 and Executive Directors. however commensurate with theBusiness operations of the Company due to lack of response the Company unable to getsuitable KMPs and Executive Directors on the Board.
Reply to observations 2 4.S.6.7.8 & 9:
The Company has put in place adequate internal controls to ensure utmost compliancepertaining to Stock Exchange SEBI Company Law etc.
25. RISK MANAGEMENT POLICY
The Company has framed Risk Management Policy to identify evaluate monitor andminimize identifiable risks such as strategic financial operational compliance legaland regulatory etc. and to manage and control risks on a continuous basis.
In terms of Regulation 21(5) of Listing Regulations the Risk Management Committee isnot applicable to the Company.
26. INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS
The Company has adequate system of internal controls that are commensurate with itssize and nature of business to safeguard and protect the Company from losses unauthoriseduse or disposition of its assets. All the transactions are properly authorised recordedand reported to the management. The Company is following all the applicable AccountingStandards for properly maintaining the books of accounts and ensuring timely reporting offinancial statements.
27. ANNUAL RETURN
In accordance with the Companies Act 2013 the annual return in the prescribed formatis available at https://www.essar.com/wp-content/uploads/2021/07/ ESecL Annual Return.pdf
28. SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
The Company does not have any subsidiary company or joint venture during the financialyear under review.
29. CORPORATE GOVERNANCE REPORT
In compliance with the provisions of Regulation 34 read with Schedule V of the ListingRegulations the Corporate Governance Report of the Company for the financial year endedMarch 31 2021 and a Certificate from M/s. D K S K & Company Chartered Accountantsthe Auditors on compliance with the provisions of Corporate Governance requirements asprescribed under the said Regulations are annexed and forms part of this Annual Report.
30. COMPLIANCE WITH SECRETARIAL STANDARDS
The Company has devised proper systems to ensure compliance with the provisions of allapplicable Secretarial Standards issued by the Institute of Company Secretaries of Indiaand that such systems are adequate and operating effectively.
31. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS
There have been no significant and material orders passed by any regulators or courtsor tribunals impacting the going concern status of the Company and its future operations.
The Directors of the Company express their appreciation for the continuous support andco-operation received from all the stakeholders during the year.
| ||For and on behalf of the Board of Directors of |
| ||Essar Securities Limited || |
|July 14 2021 ||Somashekhar B. Malagi ||Priyanka Oka |
|Mumbai ||Director DIN: 07626139 ||Director |
| || ||DIN: 08066379 |