To the Members
Your Directors have pleasure in presenting the 11th Annual Report of Future MarketNetworks Limited ("the Company") along with the audited financial statements forthe financial year ended March 31 2019.
The Company's performance during the financial year ended March 31 2019 as compared tothe previous financial year is summarized below:
|a) Standalone || || |
| || ||(? in lakhs) |
|Particulars ||Year Ended March 31 2019 ||Year Ended March 31 2018 |
|Revenue from Operations ||10378.57 ||7941.43 |
|Other Income ||1849.60 ||3496.26 |
|Total Income ||12228.17 ||11437.69 |
|Operating Cost ||4942.36 ||4868.65 |
|Cost of units sold ||3.54 ||39.28 |
|Personnel Cost ||389.93 ||469.82 |
|Other Expenses ||1239.48 ||699.51 |
|Total Expenditure ||6575.31 ||6077.26 |
|Profit before Interest Depreciation and Tax ||5652.86 ||5360.43 |
|Less: Interest ||1957.02 ||2326.54 |
|Less: Depreciation ||2505.88 ||2486.41 |
|Profit / (Loss)before Taxation ||1189.96 ||547.48 |
|Less: Exceptional Item ||- ||- |
|Less: Provision for taxation ||- ||- |
|Less: Deferred Tax/Earlier Year's Provision Written back ||225.93 ||367.20 |
|Profit (Loss) after Taxation ||964.03 ||180.28 |
|b) Consolidated || || |
| || ||(? in lakhs) |
|Particulars ||Year Ended March 31 2019 ||Year Ended March 31 2018 |
|Revenue from Operations ||10860.48 ||8424.76 |
|Other Income ||1699.84 ||3373.64 |
|Total Revenue ||12560.32 ||11798.40 |
|Operating Cost ||5017.44 ||4966.47 |
|Cost of units sold ||3.54 ||39.28 |
|Personnel Cost ||418.33 ||469.82 |
|Other Expenses ||1380.20 ||806.83 |
|Total Expenditure ||6819.51 ||6282.40 |
|Profit before Interest Depreciation and Tax ||5740.81 ||5516.00 |
|Less: Interest ||2026.27 ||2457.12 |
|Less: Depreciation ||2626.32 ||2607.61 |
|Add: Share of net profit of associates and joint ventures accounted by using equity method ||145.77 ||(1639.62) |
|Add: Profit on conversion of investment in equity instruments of joint venture into subsidiaries ||- ||149.41 |
|Profit before tax from Continuing Operations ||1249.52 ||(1038.94) |
|Less: Provision for taxation/Earlier Year's Provision Written back ||11.00 ||19.84 |
|Less: Deferred Tax ||273.12 ||399.71 |
|Profit/(Loss) after Taxation from continuing operation ||949.87 ||(1458.49) |
|Profit/(Loss) from discontinued operation ||7.75 ||- |
|Profit/ (Loss) for the year ||957.62 ||(1458.49) |
Your Company has adopted Indian Accounting Standards (Ind AS) with effect from April 12016 pursuant to the notification of the Companies (Indian Accounting Standards) Rules2015 issued by the Ministry of Corporate Affairs and your Company has not made anytreatment other than provided under Ind AS while preparing its financial statements.
Scheme of Merger by Absorption of Star Shopping Centres Private Limited by the Company
Your Company had entered into a Scheme of Merger by absorption of Star Shopping CentresPrivate Limited (Star) and their respective Shareholders under Sections 230-232 and otherapplicable provisions of the Companies Act 2013 ("the Act") in order toconsolidate the business under single entity. The scheme is approved by Hon'ble NationalCompany Law Tribunal ("NCLT") Mumbai Bench on August 2 2019. The AppointedDate under the Scheme is April 1 2017.
During the year ended March 31 2019 your Company has achieved total Revenue (i.e.Revenue from Operations & Other income) of Rs. 12228.17 Lakhs as against Rs. 11437.69Lakhs for the previous year ended March 31 2018. Your Company has achieved Profit beforetax of Rs. 1189.96 Lakhs for the current year as against Rs. 547.48 Lakhs forthe previous year (an increase of 117.35 % over the previous year).
During the year ended March 31 2019 your Company's consolidated Revenue stood at Rs. 12560.32 Lakhs as against Rs. 11798.40 Lakhs for the previous year endedMarch 31 2018. Your Company has achieved Profit before tax of Rs. 1249.52 Lakhs forthe current year as against a loss of Rs. 1038.94 Lakhs for the previous year onconsolidated basis.
Your Company is engaged in development and management of commercial retail and infralogistic projects. There was no change in nature of the business of your Company duringthe year under review.
Your Company is engaged to construct develop and sell integrated large-scalewarehouses at Jhajjar (Haryana) and Nagpur (Maharashtra) aggregating to 1.3 million squarefeet. Accordingly your Company has along with Gati Realtors Private Limited (SPV-1) andFuture Retail Destination Limited (SPV-2) (SPV 1 and 2 (SPV's) both are presently whollyowned subsidiaries of FMNL) entered into a strategic arrangement with ESR NAGPUR 1 PTELTD and ESR DELHI 3 PTE LTD (investor SPV's) respectively.
Your Company shall dilute its holding in its SPV's by way of sale of 51% of itsinvestment to respective Investor SPV's in terms of Transaction Documents executed inrelation to this arrangement. Upon completion of the Project and successful handover yourCompany shall exit from the respective SPV's by way of sale of balance 49% of itsinvestment in the respective SPVs.
During the financial year ended March 31 2019 the Company is in compliance with theSecretarial Standards with respect to Meeting of the Board of Directors ("SS-1")and General Meetings("SS-2") issued and amended by the Institute of CompanySecretaries of India in terms of Section 118(10) of the Companies Act 2013. The same hasalso been confirmed by the Secretarial Auditor of the Company.
The Board is not recommending any dividend for the financial year ended March 31 2019in order to conserve the resources. Regulation 43A of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 (Listing Regulations) with regard toformulation of Dividend Distribution Policy is not applicable to your Company.
Unpaid / Unclaimed fractional entitlement
In terms of the provisions of Section 125(2)(l) of the Act and other applicableprovisions of the Act read with the Investor Education and Protection Fund (IEPF)Authority (Accounting Audit Transfer and Refund) Rules 2016 an amount of Rs. 73268 (Rupees seventy three thousand two hundred sixty eight only)related to saleproceeds of fractional shares arising out of the Scheme of Demerger arrangement withPantaloon Retail India Limited (now known as Future Enterprises Limited) was transferredto the Investor Education and Protection Fund during the year under review.
During the year under review your Company has not made any appropriations.
The Authorized Share Capital of the Company is Rs. 903100000/- (Rupees NinetyCrores Thirty One Lakhs) divided into 90260000 equity shares of Rs. 10/- each and5000 Preference Shares of Rs. 100/- each.
The subscribed and paid up sharecapital of the Company as on March 31 2019 is Rs. 562912810/- divided into 56291281 equity shares of Rs. 10/- each.
Acuite Ratings & Research Limited (erstwhile SMERA Ratings Limited) has assignedthe rating of ACUITE A- / Stable' to your Company and the said rating denotes stableoutlook of safety for timely servicing of debt obligation and carries low credit risk.
Deposits from Public
During the year under review your Company neither accepted any deposits nor there wereany amounts outstanding at the beginning of the year which were classified asDeposits' in terms of Section 73 of the Act read with the Companies (Acceptance ofDeposit) Rules 2014 and hence the requirement for furnishing of details of depositswhich are not in compliance with the Chapter V of the Companies Act 2013 are notapplicable.
Consolidated IND AS financial Statements
In compliance with the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 (hereinafter referred to as the Listing Regulations') and Section129 of the Act the Consolidated Financial Statements which have been prepared by theCompany in accordance with the applicable provisions of the Act and the applicable IndianAccounting Standards (Ind AS) forms part of this Annual Report.
Cash Flow Statement
In conformity with the provisions of Regulation 34 of Listing Regulations the CashFlow Statement for the year ended March 31 2019 has been provided in the Annual Reportwhich forms part of this report.
The Annual Report of your Company containing the standalone and consolidated Ind ASfinancial statements has been disseminated on the website of the Company at www.fmn.co.in.
Subsidiaries and Associates
At the beginning of the year your Company had 6 subsidiaries and 3 Associates. Duringthe year under review: i. Future Retail Destination Limited became a Wholly OwnedSubsidiary of the Company with effect from September 18 2018 as compared to a JointVenture in the previous financial year and Jeremia Real Estate Private Limited became aWholly Owned Subsidiary on account of acquisition of 100% of the paid up share capital bythe Company with effect from August 28 2018 and ii. Utility Developers Private Limitedceased to be the Joint Ventures / Associates of the Company.
As on March 31 2019 the Company has the following Subsidiaries and joint ventures:
|Name of the Subsidiary ||Name of the Subsidiary |
|1 Aashirwad Malls Private Limited ||5 Sun City Properties Private Limited |
|2 Suhani Mall Management Company Private Limited ||6 Gati Realtors Private Limited |
|3 Future Trade Markets Private Limited ||7 Future Retail Destination Limited |
|4 Star Shopping Centres Private Limited* ||8 Jeremia Real Estate Private Limited |
|Name of the Joint Venture || |
|1 Riddhi Siddhi Mall Management Private Limited || |
* Note: Star Shopping Centres Private Limited is treated as Joint Venture whilepreparation of Financial Statements in terms of IND AS. In accordance with the provisionsof Section 129(3) of the Act read with the Companies (Accounts) Rules 2014 a statementin Form AOC-1 containing the salient features of the financial statements of thesubsidiary companies is appended hereto as Annexure A'.
Audited Annual Accounts of the Subsidiary Companies have also been placed on thewebsite of the Company and are available for inspection by the members at the RegisteredOffice of the Company. Members interested in obtaining copy of the Audited Annual Accountsof the Subsidiary Companies may write to the Company Secretary at the Company's RegisteredOffice address. These documents will also be available for inspection till the date of AGMduring business hours at the registered office of the Company in Mumbai.
Director's Responsibility Statement
To the best of their knowledge and belief Directors of the Company make the followingstatements in terms of Section 134(3) (c) of the Companies Act 2013:
a) in the preparation of the annual accounts for the financial year ended March 312019 the applicable accounting standards have been followed along with properexplanations relating to material departures wherever applicable;
b) they have selected such accounting policies and applied consistently and theDirectors made judgments and estimates that are reasonable and prudent so as to give atrue and fair view of the state of affairs of the Company as at March 31 2019 and of theprofit of the Company for the year ended on that date;
c) they 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) they have prepared the annual accounts for the financial year ended March 31 2019on a going concern basis;
e) they have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and operating effectively; and
f) they have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
In compliance with the Regulation 34 read with Schedule V of the Listing Regulations adetailed report on Corporate Governance is given as an Annexure and forms an integral partof this Annual Report. A Certificate from the statutory auditors confirming compliance ofthe conditions of Corporate Governance as stipulated under the Listing Regulations isappended to the Corporate Governance Report.
Management Discussion and Analysis
The Management Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34 (2) of the Listing Regulations is appended to this report.
Matters related to Directors and Key Managerial Personnel Directors
The current policy is to have an appropriate combination of executive non-executiveand independent directors to maintain the independence of the Board and separate itsfunctions of governance and management. As on the date of this report the Board consistsof 7 Directors 3 of whom are Independent Directors including a Woman Director 3Non-Executive Directors and 1 Executive Director.
Changes in Board
Mr. Sunil Biyani was appointed as the Managing Director of the Company for a period of5 (five) years with effect from May 30 2013. His term was completed on May 30 2018 andhe ceased to be the Managing Director of the Company. However Mr. Sunil Biyani shallcontinue to be on the Board of the Company as a Non-Executive Director liable to retire byrotation.
Mr. Pramod Arora was appointed as a Whole Time Director of the Company for a period of3 (three) years with effect from August 14 2017. Mr. Pramod Arora resigned as the WholeTime Director of the Company with effect from October 08 2018. However Mr. Pramod Arorashall continue to be on the Board of the Company as a Non-Executive Director liable toretire by rotation.
Mr. Pawan Kumar Agarwal is appointed as an Additional Director with effect from May21 2019 and designated as Executive Director and Chief Financial Officer of the Companyfor a period of 5 (five) years subject to the approval of the members at the ensuingAnnual General Meeting.
In terms of the provisions of Section 152 (6) (c) of the Act read with the Articles ofAssociation of the Company Mr. Sunil Biyani and Mr. Rajesh Kalyani will retire byrotation at the ensuing Annual General Meeting (AGM) and being eligible offers themselvesfor reappointment and resolution for their reappointment is incorporated in the Notice ofthe ensuing Annual General Meeting. The Board recommends their reappointment for yourapproval.
On the recommendation of Nomination Remuneration and Compensation Committee the Boardof Directors of the Company at its meeting held on May 21 2019 subject to the approvalof the members of the Company appointed Mr. Pawan Kumar Agarwal as an Executive Directorand Chief Financial Officer of the Company not liable to retire by rotation for a periodof 5 (five) years commencing from May 21 2019 to May 20 2024 (both days inclusive) onthe terms and conditions as set out in the Agreement duly executed between the Company andMr. Pawan Kumar Agarwal. Requisite proposal seeking your approval for his appointment andpayment of remuneration forms part of the Notice convening the 11th Annual General Meetingof the Company. The Board recommends his appointment for your approval. The brief resumeand other information as required under Regulation 36 (3) of Listing Regulations relatingto Mr. Sunil Biyani Mr. Rajesh Kalyani and Mr. Pawan Kumar Agarwal forms part of theNotice of ensuing Annual General Meeting. None of the Directors are disqualified forappointment / reappointment under Section 164 of the Act.
The Company has complied with provisions of Section 203 of the Act.
Declarations by Independent Directors
All Independent Directors of the Company have submitted the declaration of Independenceas required under Section 149 (7) of the Act confirming that they meet the criteria ofindependence as laid down under Section 149 (6) of the Act and read with applicableprovisions of the Listing Regulations.
Pursuant to the provisions of Section 134(3)(d) Section 149(6) and Schedule IV of theAct read with Listing Regulations formal annual performance evaluation of the Board theDirectors as well as Committees of the Board has been carried out and the details ofevaluation carried out are provided in the Corporate Governance Report.
Familiarization Programme for Independent Directors
The Familiarization Programme seeks to update the Independent Directors on variousmatters covering Company's strategy business model operations organization structurefinance risk management etc. It also seeks to update the Independent Directors with theirroles rights responsibilities duties under the Act and other statutes.
Disclosures under section 134(3)(l) of the Act
Except as disclosed elsewhere in this report no material changes and commitments whichcould affect the Company's financial position have occurred between the end of thefinancial year of the Company to which the financial statements relate and the date ofthis report.
Particulars of loans guarantees investments under section 186 of the Act
Your Company has extended the support to the financial needs of the Special PurposeVehicle Companies viz. Wholly Owned Subsidiaries and Joint Ventures.
The details of loans given guarantees given investments madeand securities providedunder the provisions of Section 186 of the Act are provided in the Notes to the standalonefinancial statement.
Disclosure relating to equity shares with differential rights
The Company has not issued any equity shares with differential rights during the yearunder review and hence no information as per provisions of Rule 4(4) of the Companies(Share Capital and Debenture) Rules 2014 is furnished.
Disclosure relating to sweat equity share
The Company has not issued any sweat equity shares during the year under review andhence no information as per provisions of Rule 8(13) of the Companies (Share Capital andDebenture) Rules 2014 is furnished.
Disclosure relating to Employee Stock Option Scheme
i. FMNL - Employee Stock Option Scheme - 2012
All the options granted under FMNL Employee Stock Option Scheme 2012 wereeither exercised or lapsed. Considering the administrative convenience and bettergovernance the Scheme was suspended with effect from May 25 2018.
ii. Future Market Networks Limited - Employee Stock Option Scheme 2016
Pursuant to the approval granted by the shareholders at the eight Annual GeneralMeeting held on September 20 2016 your Company has formulated Future Market NetworksLimited - Employee Stock Option Scheme 2016 (FMNL ESOS 2016). The Scheme is inCompliance with SEBI (Share Based Employee Benefits) Regulations 2014 as amended fromtime to time ("SEBI Employee Benefits Regulations").
Your Company has granted 760000 options to eligible employees on May 25 2018 underEmployee Stock Option Scheme 2016 ("ESOS 2016") at an exercise price of Rs. 85/- per equity share. These options shall vest over a period of four years in theproportion of 25% for each year from the date of grant. These options can be exercisedanytime within a period of three years from the date of vesting. 550000 options grantedduring the year under review lapsed consequent to the resignation of the employee.
In compliance with the provisions of Rule 12(9) of the Companies (Share Capital andDebenture) Rules 2014 and SEBI (Employee Share Based Employee Benefits) Regulations2014 the details of Employee Stock Option Scheme as on March 31 2019 are furnished as Annexure"B" attached herewith and forms part of this report.
Disclosures related to Board Committees and Policies
The details are provided in the Corporate Governance Report that forms part of thisReport.
Meetings of Board
The Board of Directors met Four (4) times during the financial year ended March 312019 in accordance with the provisions of the Companies Act 2013 and rules made thereunder. All the Directors actively participated in the meetings and provided their valuableinputs on the matters brought before the Board of Directors from time to time. On January30 2019 the Independent Directors held a separate meeting in compliance with therequirements of Schedule IV of the Companies Act 2013 and the provisions of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. The maximum interval betweenany two meetings did not exceed 120 days as prescribed in the Act.
Nomination Remuneration and Compensation Committee
Nomination Remuneration and Compensation Committee is constituted in accordance withthe provisions of sub-section (1) of Section 178 of the Act. Kindly refer section onCorporate Governance which is forming part of this report under head NominationRemuneration and Compensation Committee for matters relating to constitution meetingsfunctions of the Committee and the remuneration policy formulated by this Committee.
Audit Committee is constituted in accordance with the provisions of Section 177 of theAct and Regulation 18 of the Listing Regulation. The Audit Committee comprises of Mr.Vijai Singh Dugar Mr. K. A. Somayajulu Independent Directors and Mr. Rajesh Kalyani Non-ExecutiveDirector. Four meetings of the Committee were held during the year.
During the year under review all the recommendations made by the Audit Committee wereaccepted by the Board. There were no instances where the Board has not accepted anyrecommendation of the Audit Committee.
Details of Committees of the Board of Directors along with their terms of referencecomposition and meetings held during the year under review are provided separately in theCorporate Governance Report which forms part of this Annual Report.
Auditors and their Reports
The matters related to Auditors and their Reports are as under:
Observations of statutory auditors on financial statements for the year ended March 312019
The Auditor's Report on Standalone and Consolidated Ind AS financial statements is partof this Annual Report. There has been no qualification reservation adverse remark ordisclaimer given by the Auditors in their Report.
The Statutory Auditors has not reported any matter under Section 143(12) of the Act inrespect to their report for the year ended March 31 2019. Therefore no detail isrequired to be disclosed under Section 134(3) (ca) of the Act.
Statutory Auditors and their report
The Notes on financial statement referred to in the Auditor's Report are self explanatory and do not call for any further explanation. The Auditor's Report does notcontain any qualification reservation or adverse remark or disclaimer.
The Shareholders of the Company at their 8th Annual General Meeting held on September20 2016 appointed M/s. Viren Gandhi & Co. Chartered Accountants as the StatutoryAuditor for a period of 3 (Three) years i.e till the conclusion of the 11th Annual GeneralMeeting of the Company which is scheduled to be held on September 16 2019. Since M/s.Viren Gandhi & Co. Chartered Accountants has completed their tenure of twoconsecutive terms as stipulated under Section 139 (2) of the Act they will cease to bethe Statutory Auditors of the Company.
M/s. S K Patodia & Associates. Chartered Accountants Mumbai bearing ICAIRegistration No. 112723W had accorded their consent to be appointed as Statutory Auditorsof the Company in place of M/s. Viren Gandhi & Co. Chartered Accountants Mumbai.
As required under the provisions of section 139 of the Act the Company obtained awritten certificate from the Auditors to the effect that their appointment if made wouldbe in conformity with the limits specified in the said section. The Board recommends theirappointment. The Auditors report to the members read together with the relevant notesthereon are self-explanatory and hence do not warrant any comments under section 134(1)(f)of the Act.
They have confirmed their eligibility under Section 141 of the Act and the Rulesframed there under for reappointment as Auditors of the Company. As required underRegulation 33(d) of the Listing Regulations the auditors have also confirmed that theyhold a valid certificate issued in terms of the Peer Review.
Secretarial Auditor and Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Act Mr. Alwyn D'Souza of AlwynD'Souza & Company Practicing Company Secretaries (CP No. 5137) had been appointed toundertake the secretarial audit of the Company for the financial year ended on March 312019. The Secretarial Audit Report is annexed herewith as Annexure C' whichforms an integral part of this report. The said report does not contain any qualificationreservation adverse remark or disclaimer. During the year the Secretarial Auditors hadnot reported any matter under Section 143(12) of the Act. Therefore no detail is requiredto be disclosed under Section 134(3) (ca) of the Act.
The management has established internal control systems commensurate with the size andcomplexity of the business. The internal control manual provides a structured approach toidentify rectify monitor and report gaps in the internal control systems and processes.
The Company follows well-documented Standard Operating Procedures (SOPs). The operatingeffectiveness of various controls is periodically tested and deficiencies if any arepromptly rectified.
During the year under review no material or serious observation has been received fromthe Statutory Auditors and the Internal Auditors of the Company on the inefficiency orinadequacy of such controls.
Internal Control Systems
Adequate internal control systems commensurate with the nature of the Company'sbusiness and size and complexity of its operations are in place and have been operatingsatisfactorily. Internal control systems comprising of policies and procedures aredesigned to ensure reliability of financial reporting timely feedback on achievement ofoperational and strategic goals compliance with policies procedure applicable laws andregulations and that all assets and resources are acquired economically used efficientlyand adequately protected.
Related Party Transactions
In line with the requirements of the Act and Listing Regulations your Company hasformulated a Policy on Related Party Transactions which is available on Company's websiteat www.fmn.co.in. This policy deals with the review and approval of related partytransactions. The Board of Directors of the Company has approved the criteria for givingthe omnibus approval by the Audit Committee within the overall framework of the Policy onRelated Party Transactions.
All Related Party Transactions that were entered into during the financial year were onarm's length and were in the ordinary course of business. All Related Party Transactionswere placed before the Audit Committee of the Board of Directors for their approval. TheAudit Committee has granted omnibus approval for Related Party Transactions as per theprovisions and restrictions contained in the Listing Regulations.
Pursuant to Regulation 23 of the Listing Regulations all related party transactionswere placed before the Audit Committee on a quarterly basis specifying the nature valueand terms & conditions of the transactions for their review and approval.
The Company has entered into the material related party transactions during thefinancial year under review as required under Section 134(3)(h) of the Act. Particulars ofcontract or arrangements with related parties referred to in section 188(1) of the Act inthe prescribed Form AOC-2 is appended as Annexure D' which forms part ofthis Report. The said transactions were approved by the Board and Audit Committee.
The related party disclosures as specified in Para A of Schedule V read with Regulation34(3) of the Listing Regulations are given in the Financial Statements.
Disclosures of transactions with any Person or entity belonging to the promoter/Promoter group which hold(s) 10% or more Shareholding in the company
During the year under review the Company is a Subsidiary of Future Corporate ResourcesPrivate Limited (FCRPL) (formerly known as Suhani Trading and Investment ConsultantsPrivate Limited). FCRPL holds 73.06 % of the paid up share capital of the Company.
There were no transactions during the period under review with any entity forming partof Promoter Group and holding more than 10% of the shareholding in the Company.
Your Company has formed a Whistle Blower Policy for establishing a vigil mechanism fordirectors and employees to report genuine concerns regarding unethical behavior andmismanagement if any. The said mechanism also provides for strict confidentialityadequate safeguards against victimization of persons who use such mechanism and makesprovision for direct access to the Chairman of the Audit Committee in appropriate cases.No personnel have been denied access to the Audit Committee pertaining to the WhistleBlower Policy. The said Whistle Blower Policy has been disseminated on the Company'swebsite at viz. http://fmn.co.in/investor-relations/policies.html.
Particulars of Employees and other additional information
The statement of disclosure of Remuneration under Section 197(12) of the Act read withthe Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 (Rules') is appended as Annexure E' to this Report.
Corporate Social Responsibility (CSR)
In accordance with the requirements of Section 135 of the Act read with the Companies(Corporate Social Responsibility Policy) Rules 2014 your Board has constituted CSRCommittee on May 21 2019 which comprises of Mr. Vijai Singh Dugar Chairman Mr. K. A.Somayajulu and Mr. Rajesh Kalyani as its members.
The Company shall implement Corporate Social Responsibility initiatives in due course.
The Board of Directors of the Company has formulated a Risk Management Policy whichaims at minimizing the risk and enhancing the value and reviews the elements of risks withregard to the business.
The risk management approach is based on a clear understanding of the variety of risksthat the organization faces disciplined risk monitoring and measurement and continuousrisk assessment and mitigation measures.
Extract of Annual Return
Pursuant to Section 92(3) of the Act read with Rule 12(1) of the Companies (Managementand Administration) Rules 2014 an extract of the Annual Return of the Company in FormMGT-9 is annexed as Annexure F' and forms an integral part of this report.
The Annual Return as referred in Section 134(3)(a) of the Act for the financial yearended March 31 2019 shall be placed on the website of the Company at www.fmn.co.in.
Payment of remuneration / commission to executive directors from holding or subsidiarycompanies
Mr. Pramod Arora Whole Time Director of the Company (up to October 08 2018) wasappointed as the Managing Director of Future Retail Destination Limited (FRDL) which iswholly owned subsidiary of the Company with effect from September 18 2018.
Remuneration paid to Mr. Pramod Arora from FRDL being its Managing Director and theaggregate remuneration payable from both the companies up to October 08 2018 has notexceed the overall remuneration as set out in the resolution approved by the Shareholdersof the Company at any point of time.
Detection of Fraud
There have been no instance of Fraud reported by the Auditors under section 143 (12) ofthe Act and Rules framed thereunder either to the Company or the Central Government.
Disclosures in respect of voting rights not directly exercised by employees
There are no shares held by trustees for the benefit of employees and hence nodisclosure under section 67(3) read with Rule 16(4) of the Companies (Share Capital andDebentures) Rules 2014 has been furnished.
Significant and Material Orders passed by Regulators or Courts or Tribunal
No significant and material orders have been passed by any Regulator or Court orTribunal which can have an impact on the going concern status and the Company's operationsin future during the period under review. Other relevant details are provided in the notesto the standalone financial statements.
Sexual Harassment of Women at workplace
The Company has constituted an Internal Complaints Committee as required under theSexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013(POSH). The details required to be disclosed under POSH forms Part of the CorporateGovernance Report.
Material Changes and Commitments affecting financial position
There have been no material changes and commitments affecting the financial position ofthe Company which have occurred between March 31 2019 and the date of this Report otherthan those disclosed in this Report.
Declaration by Executive Director
As per Regulation 34 (3) read with Schedule V of the Listing Regulations declarationstating that the members of board of directors and senior management personnel haveaffirmed compliance with the code of conduct of board of directors and senior managementis enclosed as Annexure G'.
Certificate on Corporate Governance
As per Regulation 34 (3) read with Schedule V of the Listing Regulations the auditor'scertificate on corporate governance is enclosed as Annexure H' to the Board'sreport. The auditor's certificate for financial year 2019 does not contain anyqualification reservation or adverse remark.
The Company recognizes and embraces the importance of a diverse board. We believe thata truly diverse board will leverage differences in thought perspective knowledge skillindustry experiences age which will help us to have competitive advantage. The Board hasadopted the Board Diversity Policy which sets out the approach to diversity of the Boardof Directors. The Board Diversity Policy is available on our website at www.fmn.co.in.
Policy on Director's Appointment and Remuneration
The policy of the Company on director's appointment and remuneration including thecriteria for determining qualifications positive attributes independence of a directorand other matters as required under sub-section (3) of Section 178 of the Act isavailable on our website at www.fmn.co.in.
There has been no change in the policy since last fiscal. We affirm that theremuneration paid to directors is as per the terms laid out in the Nomination andRemuneration Policy of the Company.
At the time of the appointment of an independent director the Company issues a formalletter of appointment outlining his / her role function duties and responsibilities. Theletter of appointments issued to independent directors is available on our website atwww.fmn.co.in.
Code of conduct for 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) Regulations 2015.
The Insider Trading Policy of the Company lays down guidelines and procedures to befollowed and disclosure to be made while dealing with shares of the Company as well asthe consequences of violation. The policy has been formulated to regulate monitor andensure reporting of deals by employees and to maintain the highest ethical standards ofdealing in Company securities.
The Insider Trading Policy of the Company covering code of practices and procedures forfair disclosure of unpublished price sensitive information and code of conduct for theprevention of insider trading is available on our website at www.fmn.co.in.
Listing on stock exchanges
The Company has entered into Listing Agreement with BSE Limited (BSE) and The NationalStock Exchange of India Ltd. (NSE) in terms of the Regulation 34 (3) read with Schedule Vof the Listing Regulations and the listing fee for the year 2019-20 has been paid.
Your Company's equity shares are available for dematerialization through NationalSecurities Depository Limited and Central Depository Services (India) Limited. As on March31 2019 99.89% of the equity shares of the Company are held in dematerialised form.
Service of documents through electronic means
Subject to the applicable provisions of the Act all documents including the Noticeand Annual Report shall be sent through electronic transmission in respect of memberswhose email IDs are registered in their demat account or are otherwise provided by themembers. A member shall be entitled to request for physical copy of any such documents andshall be provided upon receiving specific request from members.
Conservation of energy technology absorption and foreign exchange earnings and outgo
Your Company gives significant emphasis on improvement in methods and processes in itsareas of Construction and Development. The information as required under Section 134(3)(m)of the Act read with Rule 8 of the Companies (Accounts) Rules 2014 for the financial yearended March 31 2019 with respect to the Conservation of Energy Technology Absorption andForeign Exchange Earnings and Outgo has been annexed to this Report as AnnexureI' which forms an integral part of this report.
Maintenance of cost records
Maintenance of cost records and requirement of cost audit as prescribed under theprovisions of Section 148(1) of the Act are not applicable for the business activitiescarried out by the Company.
Your Company has been able to perform better with the continuous improvement in allfunctions and areas which coupled with an efficient utilization of the Company's resourcesled to sustainable and profitable growth of the Organization. Your Directors express theirdeep sense of appreciation to every employee and associates for their dedicated andsustained contribution and look forward the continuance of the same in future.
The Board places on record its appreciation to all stakeholders particularlyshareholders customers bankers suppliers business partners and the Government.
The statements forming part of the Director's Report may contain certainforward-looking remarks within the meaning of applicable securities laws and regulations.Many factors could cause the actual results performance or achievements of the Company tobe materially different from any future results performances or achievements that may beexpressed or implied by such forward looking statements.
For and on behalf of Board of Directors
|Vijai Singh Dugar ||Pawan Kumar Agarwal |
|Chairman ||Executive Director & CFO |
|DIN: 06463399 ||DIN: 01435580 |
Date: August 13 2019