Your Directors have pleasure in presenting their 24th Annual Report on the business andoperations of the Company and the accounts for the Financial Year ended March 312018.
1. FINANCIAL PERFORMANCE OF THE COMPANY
The Board's Report shall be prepared based on the stand alone financial statements ofthe company.
|Particulars ||2017-18 ||2016-17 |
|Total Income ||26007434.62 ||25431435.25 |
|Total Expenditure ||10255754.26 ||8077683.74 |
|Profit Before Exceptional and Extraordinary Items and Tax ||15751680.36 ||17353751.51 |
|Exceptional Item ||4133846.00 ||3962707.00 |
|Profit Before Tax ||11617834.36 ||13391044.51 |
|Tax Expense: || || |
|(i) Current Tax ||3225522.00 ||4279126.00 |
|(ii) Deferred Tax ||- ||- |
|Profit/(Loss) for the period ||8392312.36 ||9111918.51 |
|Earnings per Equity Share: || || |
|(!) Basic ||2.39 ||2.59 |
|(ii) Diluted ||2.39 ||2.59 |
2. BUSINESS OVERVIEW:
Your Company's revenue from operations increased to Rs.25957848.62 in theyear2017-2018from Rs.25114077.25 in the previous year at growth rate about 3.36%.Further during the year under review your Company has earned a net profit after taxationof Rs.8392312.36/- as compared to Rs. 9111918.51/- in the previous year.
Your Directors are confident of further improving the performance and growth of theCompany in the ensuing years to face new challenges and competitive environment. YourCompany will respond to the competitive challenges by enhancing customer focus bybuilding more efficient network by ensuring adequate preparedness to take maximumadvantage of the opportunities and aggressively pursuing them.
3. TRANSFER TO RESERVES:
Your Company has transferred a sum ofRs.1678462.47 to Statutory Reserve as requiredunder the Reserve Bank of India Act 1934. The Company has not transferred any amount toGeneral Reserve during the year under review.
Your Company has distributed an interim dividend ofRs. 0.25/- (2.50%) per equity shareof face value ofRs.10 each to shareholders who were on the register of members of theCompany as on the closing hours of business on 6th March 2018 being the record datefixed by the Board of Directors for this purpose. Interim dividend was paid on 8th March2018.
5. MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICHTHE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT i.e. AFTER 31ST MARCH 2018BEFORE DATE OF SIGNATURE OF DIRECTORS'REPORT:
There have been no material changes and commitments that affect the financial positionof the company which have occurred between the end of the financial year of the company towhich the financial statements relate and the date of the report.
6. CHANGE IN THE NATURE OF BUSINESS IF ANY.
There has been no change in the business of the Company during the year under review.
7. NAMES OF THE COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES JOINTVENTURES OR ASSOCIATE COMPANIES DURING THE YEAR ALONG WITH REASONS:
The Company has no subsidiaries. Further during the year no joint ventures or associatecompanies were incorporated.
8. RBI GUIDELINES:
The Company fulfills all the norms and standards applicable to NBFCs as set out byReserve Bank of India (RBI). Your Company is well capitalized and has a capital adequacyratio as required by non- deposit accepting NBFCs as prescribed by RBI.
9. DIRECTORS AND KEY MANAGERIAL PERSONNEL:
(i) Ms. Bindu Gilada (DIN: 00392976) retires by rotation at the forthcoming AnnualGeneral Meeting and being eligible offers herself for reappointment.
(ii) Mr. Narayandas Jaju (DIN: 03166712) resigned as the Independent Director of theCompany with effect from 30th May 2018.The Board places on record its appreciation forthe services rendered by Mr. Narayandas Jaju during his tenure as a member of the Boardand its Committees.
(iii) The Board of Directors has appointed Mr. A. Ramanathan (DIN: 02645247) asAdditional (Independent) Director with effect from 30th May 2018. The Board recommendshis appointment as Independent Director of the Company for a period of five consecutiveyears and accordingly resolutions seeking approval of the members for the appointment ofIndependent Director have been included in the Notice of forthcoming Annual GeneralMeeting of the Company.
(iv) Mr. Prashant Banerjee was appointed as the Chief Executive Officer of the Companywith effect from 15th November 2017.
(v) CS Ashok Kumar resigned as the Company Secretary of the Company with effect from9th May 2018. The Board places on record its appreciation for the services rendered byhim.
(vi) CS Monica Geeta Gandhi (M. No. 38976) was appointed as Company Secretary & ComplianceOfficer of the Company with effect from 10th July 2018.
10. NUMBER OF BOARD & COMMITTEE MEETINGS:
A calendar of Meetings is prepared and circulated in advance to the Directors. Duringthe year Five(5) Board Meetings four(4) Audit Committee Meetings four(4) Nomination andRemuneration Committee Meetings one (1) Stakeholders Relationship Committee Meeting andone(l) Independent Directors Meeting were convened and held the details of which arefurnished in the Corporate Governance Report. The intervening gap between the Meetings waswithin the period prescribed underthe Companies Act 2013.
11. BOARD EVALUATION:
Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 mandates that the Board shall monitor and review the Board evaluationframework. The framework includes the evaluation of directors on various parameters suchas
Board dynamics and relationship
Relationship with stakeholders
Company performance and strategy
Tracking Board and committees' effectiveness
The Companies Act 2013 states that a formal annual evaluation needs to be made by theBoard of its own performance and that of its committee and individual directors. ScheduleIV of the Companies act 2013 states that the performance evaluation of IndependentDirectors shall be done by the entire Board of Directors excluding the director beingevaluated. The Board has made a formal evaluation of its own performance and that of itscommittees and individual directors as required under Section 134(3) (p) of the CompaniesAct 2013.The evaluation all directors and the Board as a whole was conducted based on thecriteria and framework adopted by the Board. The evaluation process has been explained inthe corporate governance report. The Board has approved the evaluation results as collatedby the nomination and remuneration committee.
Further Mr. Prashant Banerjee CEO of the Company submitted a Compliance Certificateunder Regulation 17(8) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 to the Board of Directors in its meeting held on 30th May 2018.
12. DECLARATION BY AN INDEPENDENT DIRECTOR(S) AND RE- APPOINTMENT IF ANY:
The Company has received necessary declaration from each Independent Director of theCompany under Section 149(7) of the Companies Act 2013 that the Independent Directors ofthe Company meet with the criteria of their Independence laid down in Section 149 (6).
The Company has not re-appointed any Independent Director after completion of fiveyears.
13. REMUNERATION POLICY:
The ratio of remuneration of each director to the median of employees' remuneration asper section 197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 forms part of Board'sreport and shown below. There was no increase in the remuneration payable to the ExecutiveDirectors - Mr. Sampath kumar Gilada and Mr. Rajgopal Gilada during the year under review.The variable component of the salary of executive director is linked to the performancetargets for the Company in terms of revenue and for other employees; the Company has adefined performance targets linked to the consolidated statement of Profit and Loss inaddition to their performance. The increments in the pay to the employees are inconsonance to average Industry standards and requirement to recognize the criticaltalents. In order to ensure that remuneration reflects company performance theperformance pay to the employees is linked to the organization performance. There are noemployees receiving remuneration in excess of the remuneration received by the ExecutiveDirectors. The ratio of the remuneration of the executive director to the medianremuneration of the employees of the Company for the year ended 31st March 2018 is givenbelow.
|Name of the Director ||Remuneration paid during 2017-2018 ||Ratio to Median Remuneration |
|Mr. Sampath Kumar Gilada Executive Director ||600000 ||3.57 |
|Mr. Rajgopal Gilada Managing Director ||1200000 ||7.14 |
Pursuant to the provisions of section 139 of the Companies Act 2013 the members atthe Annual General Meeting of the Company held on 23rd September 2017 had appointed M/s.Agiwal P. & Associates (Firm Registration No. 000051S) Chartered Accountants asStatutory Auditors of the Company from the conclusion of 23rd Annual General Meeting tillthe conclusion of 28th Annual General Meeting covering one term of five consecutiveyears but due to his pre-occupations the said auditor has resigned from the office ofthe Statutory Auditors.
Thereafter the appointment of M/s. Gnanoba & Bhat Chartered Accountants wasconsidered and is proposed for the approval of the members at the ensuing Annual GeneralMeeting scheduled to be held on 29th September 2018. If approved the aforesaid auditorsshall hold office from the conclusion of 24th Annual General Meeting till the conclusionof 29th Annual General Meeting.
Further in view of the amendment to the said section 139 through the Companies(Amendment) Act2017 notified on 7th May 2018 ratification of auditors' appointment is nolonger required. However under section 142 of the Companies Act 2013 a proposal shallbe put up for approval of members for authorizing the Board of Directors of the Company tofix Auditors'remuneration at every subsequent Annual General Meeting.
The Statutory Audit Report for the year 2017-18 does not contain any qualificationreservation or adverse remark or disclaimer made by the Statutory A uditors.
15. DISCLOSURE ABOUT COST AUDIT:
In view of the same and in terms of the provisions of Section 148 and all otherapplicable provisions of the Companies Act 2013 read with the Companies (Audit andAuditors) Rules 2014 the Company is exempt from requirements of cost audit.
16. SECRETARIAL AUDIT REPORT:
Pursuant to the provisions of section 204 of the Companies Act 2013 and the Rulesmade thereunder the Company has appointed CS Varun Nashine Practising Company Secretary(Membership No. 49574) to undertake the Secretarial Audit of the Company.
The Secretarial Audit Report for the year 2017-18 as issued by him in the prescribedform MR-3 is annexed to this Report as Annexure III. The said Secretarial Audit Reportdoes not contain any qualification reservation or adverse remark or disclaimer made bythe Secretarial Auditor.
17. INTERNAL FINANCIAL CONTROLS:
The Board has adopted policies and procedures for ensuring the orderly and efficientlyconduct of its business including adherence to the Company's policies the safe guardingof its assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and timely disclosure of financial disclosures.
18. VIGIL MECHANISM:
In pursuance to the provisions of section 177(9) & (10) of the Companies Act 2013and Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 a Vigil Mechanism for directors and employees to report genuineconcerns has been established. The Vigil Mechanism Policy has been uploaded on the websiteof the Company at www.gfil.co.in under investors/policydocuments/Vigil Mechanism Policylink.
19. RISK MANAGEMENT POLICY:
A statement indicating development and implementation of a risk management policy forthe Company including identification therein of elements of risk if any which in theopinion of the Board may threaten the existence of the company.
Your company has been rendering services with respect to lending of loans and advances.The Company has to manage various risks. These risks include Credit Risk Liquidity RiskInterest Rate Risk and Operation Risk. Being cognizant of this fact the company hasrobust risk governance and has built an effective risk management framework. The companystrongly believes that effective risk management can be a strategic differentiator andhence will remain focused on continuously strengthening its risk management systems.
The Risk Management Committee review and monitor these risk at periodical intervals.The company manages credit risk through stringent credit norms established through severalyears of experience in this line of business and continues to follow the time testedpractice of personally assessing every borrower before committing to a credit exposure.This process ensure that the expertise in lending operations acquired by the Company overdecades is put to best use and acts to mitigate credit risk. Liquidity risk and interestrate risk arising out of maturity mismatch of assets and liabilities are managed throughregular monitoring of the maturity profiles.
Operational risks arising from inadequate or failed internal process people andsystems or from external events are adequately addressed by the internal control systemsand continuously reviewed and monitored by a dedicated team of people. Processimprovements and quality control are on-going activities and built into the employee'straining modules.
20. EXTRACT OF ANNUAL RETURN:
As required pursuant to section 92(3) of the CompaniesAct2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of annual return in MGT9 as a part ofthisAnnual Report asANNEXURE I.
21. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE:
There are no significant and material orders passed by the Regulators or Courts orTribunal impacting the going concern status and company's operations in future.
The details relating to deposits covered under Chapter V of the Act and in term of thedisclosure required under section 134(3) read with rule 8(5) of the Companies (Accounts)Rules 2014 it is hereby stated that:
During the year the company has not accepted from the public any deposits within themeaning of Section 73 of the Companies Act 2013 read with the Companies (Accepting ofDeposits) Rules 2014. Further as the company has not accepted any deposits from thepublic the Company is not required to comply with the directions issued by the ReserveBank of India under Non-Banking Financial Companies (Reserve Bank) Directions 1998 withrespect to public deposits.
23. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIESACT 2013:
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are furnished in the notes to the Financial Statements.
Loans/Investments/Guarantees made to firms and companies under the same management arewithin the limits prescribed under RBI Directions 1998 to NBFC's and the limitsprescribed under Sections 185 and 186 of the Companies Act 2013.
24. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
During the year the Company did not enter into any material transaction with relatedparties under Section 188 of the Companies Act 2013. All transactions entered into bythe Company with the related parties were in the ordinary course of business and on anarm's length basis. Form AOC-2 as required under Section 134 (3) (h) of the Act readwith Rule 8 (2) of the Companies (Accounts) Rules 2014 is attached as part of this reportvideAnnexure II (a). Further the Company's policy on Related Party Transactions isattached as part of this report vide Annexure II (b) as required under the Non-BankingFinancial Companies - Corporate GovernancefReserve Bank) Directions 2015.
Your Directors draw attention of the members to Note 14 to the financial statementswhich sets out related party disclosures.
25. CERTIFICATE ON CORPORATE GOVERNANCE REPORT:
Pursuant to the SEBI Listing Regulations 2015 a separate chapter titled CorporateGovernance has been included in this Annual Report along with the reports on ManagementDiscussion and Analysis as Annexure IV & V.
All Board members and Senior Management Personnel have affirmed compliance with theCode of Conduct for the year 2017-18. A declaration to this effect signed by the ManagingDirector of the Company is contained in this Annual Report. The Managing Director &CEO have certified to the Board with regard to the financial statements and other mattersas required under regulation 17(8) oftheSEBI Listing Regulations 2015.
The Certificate from the Statutory Auditors of the Company regarding compliance ofconditions of corporate governance is annexed to this Report asAnnexure VI.
26. MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report forms part of this Annual Report for theyear ended 31st March 2018 has been provided in ANNEXURE- V in this Annual Report.
27. AUDIT COMMITTEE:
The Details of Audit Committee has beenfurnished in the Corporate Governance Report.
28. OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
In order to prevent sexual harassment of women at work place a new act. The SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 hasbeen notified on 9th December 2013. Under the said Act every company is required to setup an Internal Complaints Committee to look into complaints relating to sexual harassmentat workplace of any women employee.
The Company has adopted a policy for prevention of Sexual Harassment of Women atworkplace and has set up Committee for implementation of said policy. During the yearCompany has not received any complaint of harassment.
29. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGSANDOUTGO
The details of conservation of energy technology absorption foreign exchange earningsand outgo are as follows: a) Conservation of energy
|(i) the steps taken or impact on conservation of energy ||Your company's operation do not involve any manufacturing or processing activities the particulars regarding conservation of energy and technology absorption are not applicable. |
|the steps taken by the company for utilizing alternate sources of energy || |
|the capital investment on energy conservation equipment's || |
(b) Technology absorption
|(i) the efforts made towards technology absorption ||Technology absorption is not applicable. |
|(ii) the benefits derived like product improvement cost reduction product development or import substitution ||The Company has not incurred any expenditure on research and development during the year under review. |
|(Hi) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)- || |
|(a) the details of technology imported || |
|(b) the year of import; || |
|(c) whether the technology has been fully absorbed || |
|(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof || |
|(iv) the expenditure incurred on Research and Development || |
Foreign exchange earnings and Outgo
|(a) Foreign Exchange Earnings: ||NIL |
|(b) Foreign Exchange Outgo ||NIL |
30. CORPORATE SOCIAL RESPONSIBILITY(CSR)
The criteria for setting up Corporate Social Responsibility as prescribed by thenotification issued by the Ministry of Corporate Affairs dated 27th February 2014 readwith section 135 of the Companies Act 2013 and Companies (Corporate Social ResponsibilityPolicy) Rules 2014 are presently not applicable to the Company.
31. HUMAN RESOURCES
Your Company treats its "human resources" as one of its most importantassets. Your Company continuously invests in attraction retention and development oftalent on an ongoing basis. A number of programs that provide focused people attention arecurrently underway. Your Company thrust is on the promotion of talent internally throughjob rotation and job enlargement.
32. DIRECTORS'RESPONSIBILITY STATEMENT
The Directors' Responsibility Statement referred to in Sub-clause (c) of Clause (3) ofSub-Section (5) of Section 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 and loss of the companyfor 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;
(e) the directorshad laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and
(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.
33. PARTICULARS OF EMPLOYEES
In accordance with the provisions of Section 197 of the Act read with rule 5 of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theinformation in respect of the employees of the Company will be provided upon request. Interms of section 136 of the Act the report and accounts are being sent to the members andothers entitled thereto excluding the aforesaid information which is available forinspection by the members at the registered office of the Company during business hours onworking days of the Company. If any member is interested in obtaining a copy such membermay write to the registered office address of the Company in this regard.
34. SECRETARIAL STANDARDS:
The Directors state that applicable Secretarial Standards i. e. SS-1 and SS-2relating to 'Meetings of the Board of Directors' and 'General Meetings' respectivelyhave been duly followed by the Company.
Your Directors wish to express a deep sense of gratitude for the continued supportco-operation and guidance received from the Central and State Government DepartmentsReserve Bank of India Registrar of Companies -Bangalore Karnataka Banks and customersduring the year under review. The Directors wish to thank the Company's customers vehiclemanufacturers vehicle dealers and shareholders for their continued support. The Directorsalso thank the employees of the Company for their contribution to the company's operationsduring the year under review.
|For and on behalf of the Board of Directors || |
|GILADA FINANCE AND INVESTMENTS LIMITED || |
|MR. RAJGOPAL GILADA ||MR. SAMPATH KUMAR GILADA |
|MANAGING DIRECTOR ||DIRECTOR |
|DIN: 00307829 ||DIN:02144736 |
|DATE: 11.08.2018 || |
|PLACE: BANGALORE || |