Hybrid Financial Services Limited
(Formerly known as Mafatlal Finance Company Limited)
Your Directors present the Thirtieth Annual Report with the Audited Statement ofAccounts of the Company for the year ended 31st March 2017.
1. FINANCIAL RESULTS
The Financial results of the company for the year under review as compared to theprevious year are summarized below for your consideration:
|Particulars ||Year Ended 31.03.2017 ||Year Ended 31.03.2016 |
| ||(Rs. in Lakhs) ||(Rs. in Lakhs) |
|Gross Income ||174.45 ||220.29 |
|Gross Profit before Depreciation Exceptional Item and Income Tax ||41.00 ||71.52 |
|Depreciation ||0.31 ||0.43 |
|Provision for Tax ||Nil ||Nil |
|Net Profit After Tax ||40.69 ||71.09 |
|Add: Amount brought forward from previous year ||(1029.38) ||(1036.86) |
|Proposed Dividend on Preference Shares including Dividend Distribution Tax ||2.89 ||3.61 |
|Transferred to Capital Redemption Reserve Account for Redemption of Preference Shares ||30.00 ||60.00 |
|Balance carried forward ||(1021.58) ||(1029.38) |
The Financial Year 2016-2017 has ended with the company earning a profit of Rs. 40.69Lakhs after Tax mainly on account of Write Backs and Tax Refunds. The Company's operationsare still muted due to the uncertainties of business environment. The Company does notanticipate any significant revenue growth from operations in the coming years.
The company is trying to undertake new Non - NBFC activities and these activitiesearned an income of Rs.1.39 Lakhs during the year. Other operations have yielded an incomeof Rs.72.00 Lakhs and Rs.30.00 Lakhs as Rent. Company's business is confined to attendingto past issues from its earlier operations.
The Board of Directors have recommended a Dividend of 1% on Preference Shares amountingto Rs.2.89 Lakhs inclusive of Dividend Distribution Tax. However no dividend isrecommended on Equity Shares to conserve resources and inadequate profit.
The Board of Directors have also approved Redemption of Preference Shares of Rs.30.00Lakhs.
5. EXTRACT OF ANNUAL RETURN
Extract of Annual Return in the prescribed Form MGT-9 is given as Annexure to thisDirector's Report.
6. BOARD MEETINGS
The details of the Board Meetings held during the Financial Year 2016-2017 have beenfurnished under clause I 2(d) of the Corporate Governance Report forming a part of thisAnnual Report.
7. OTHER COMMITTEES
The Company has constituted the following Committees:
a. Audit Committee
b. Nomination and Remuneration Committee
c. Stakeholders' Relationship Committee
d. Risk Management Committee
The details regarding composition of the above Committees and the meetings held duringthe Financial Year 2016-2017 are given in the Corporate Governance Report forming a partof this Annual Report.
8. BOARD EVALUATION
The evaluation of the Company's Performance and that of Whole Time Directors was doneby the Independent Directors. The Independent Directors have not communicated anythingadverse. They have however desired that the issue of removal of suspension of Trading ofShares in the BSE to be attended and resolved.
9. PARTICULRS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
The details of Related Parties and the Transaction with them are disclosed as requiredby Accounting Standard-18 issued by The Institute of Chartered Accountants of India underNote No. 19 III) 10 forming part of this Annual Report.
Further the members may note that the Company has not entered intoContracts/Arrangements /Transactions which are not at arm's length basis.
10. TRANSFER TO RESERVES
The Company has transferred an amount of Rs. 30.00 Lakhs to Capital Redemption ReserveAccount on account of redemption of 300000 1% Redeemable Cumulative Preference Shares ofRs.10/- each.
11. LISTING OF SHARES
The Company has made an application to BSE for revocation of suspension Trading andListing of the shares under the new name on 30th August 2011. The matter is being pursued.Though the Company is filing its returns to NSE as a measure of abundant caution as it isnot proposing to list its share in the said Exchange as members have already approved theshares to be de-listed from the said Exchange in the year 2003 itself and accordinglyde-listed from the said year.
The Company's ISIN remains suspended as new ISIN subsequent to Name Change andReduction of Capital is not yet allotted.
The company made an appeal in Securities Appellate Tribunal on 21st April 2017 againstBSE for Non-Revocation of Suspension and Listing of New Shares Pursuant to CapitalReduction and against NSDL for not allotting new ISIN subsequent to Capital reduction. Inview of the steep increase in listing fees together with a high reinstatement fees costthe Promoters are also looking at the option of delisting the shares if the Companies'efforts to revoke the suspension at a reasonable cost does not succeed.
12. PENALTIES AND OTHER LITIGATIONS
Provident Fund Matter
Provident Fund Department after conducting an enquiry Under Section 7A proceedings havemade a demand of Rs. 2106154/- on the Company in year 2013-2014 based on a recalculationof dues on a Contractor for the period 2004-2011. The Company has appealed against thisdemand and obtained a stay from Employee Provident Fund Appellate Tribunal. The Company isunaware of any appeal made by the Department against the same.
13. MAXIMUS SECURITIES LIMITED [Formerly known as MAFATLAL SECURITIES LIMITED(MSL)-SUBSIDIARY COMPANY]
The Subsidiary Company has earned a net profit of Rs. 100.45 Lakhs for the financialyear ended 31st March 2017. The Subsidiary Company is exploring various options toimprove its earnings in the current financial year.
14. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS ANDOUTGOING
The Company is not engaged in manufacturing activities therefore there is noinformation to submit in respect of conservation of energy and absorption of technology.
|Foreign Exchange Earnings: ||Nil |
|Foreign Exchange Outgoings: ||Nil |
None of the Independent/Non-Executive Directors are retiring during the ensuing 30thAnnual General Meeting and hence need not seek re-appointment as their present tenure willcontinue till the conclusion of 31st Annual General Meeting
Effective October 30 2000 the Equity Shares of your Company have been mandated bySecurities and Exchange Board of India for delivery only in dematerialized form for allinvestors.
Your Company has already entered into arrangements with National Securities DepositoryLimited (NSDL) and Central Depository Services Limited (CDSL) for custody anddematerialization of shares in accordance with the Depositories Act 1996.
In terms of the requirements of Listing the Company has concluded an Agreement withCentral Depository Services (India) Limited (CDSL) for E-Voting Facility for itsShareholders.
18. PARTICULARS OF EMPLOYEES
There are no employees who are covered under Section 134(3) of the Companies Act 2013read with Companies (Particulars of Employees) Rules 1975.
19. WEBSITE OF THE COMPANY
The Company maintains a website www.hybridfinance.co.in where detailedinformation of the Company is provided.
20. WHISTLE BLOWER MECHANISM
The Company has a Whistle Blower Policy in place for vigil mechanism. The said policyhas been implemented keeping in view of the amendments in the Companies Act 2013 incompliance with the Listing Agreement.
21. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
The Company has an adequate internal control system commensurate with the size of theCompany and the nature of its business. The Internal Control System of the Company ismonitored and evaluated by Internal Auditor and his Audit Reports are periodicallyreviewed by the Audit Committee of the Board of Directors. The observations and commentsof the Audit Committee are placed before the Board.
22. DIRECTOR'S RESPONSIBILITY STATEMENT
As required under section 134(3)(c) of the Companies Act 2013 the Directors herebyconfirm that:
i. in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
ii. the Directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit of the Company for the year;
iii. 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;
iv. the Directors have prepared the Annual Accounts on a going concern basis.
23. CORPORATE GOVERNANCE
Pursuant to the Listing Agreement with the Stock Exchanges Management Discussion andAnalysis and Corporate Governance Report are made a part of the Annual Report.
24. SECRETARIAL AUDITOR
The Board of Directors have appointed Mr. Vijay S.Tiwari a practising CompanySecretary as Secretarial Auditor for the Financial Year 2016-2017.
Your Directors wish to thank and place on record their appreciation of the valuablesupport given by Company's Customers Shareholders and Bankers.
| ||FOR AND ON BEHALF OF THE BOARD |
| ||K. CHANDRAMOULI |
| ||Wholetime Director and |
|Place: Mumbai ||Company Secretary |
|Date : 18th May 2017 || |