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Monarch Networth Capital Ltd.

BSE: 511551 Sector: Financials
NSE: N.A. ISIN Code: INE903D01011
BSE 00:00 | 22 Jun 49.90 -0.10
(-0.20%)
OPEN

48.60

HIGH

50.35

LOW

48.60

NSE 05:30 | 01 Jan Monarch Networth Capital Ltd
OPEN 48.60
PREVIOUS CLOSE 50.00
VOLUME 2227
52-Week high 99.00
52-Week low 48.60
P/E 9.33
Mkt Cap.(Rs cr) 151
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 48.60
CLOSE 50.00
VOLUME 2227
52-Week high 99.00
52-Week low 48.60
P/E 9.33
Mkt Cap.(Rs cr) 151
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Monarch Networth Capital Ltd. (MONARCHNETWORTH) - Director Report

Company director report

To

The Members

Monarch Networth Capital Limited

Your Directors present the 24th Annual Report together with Financial Statements of theCompany for the financial year ended 31st March 2017. FINANCIAL HIGHLIGHTS:

The financial performance of the Company is summarized below:

(Rs. in Lacs)

Particulars

Standalone Year ended

Consolidated Year ended

Year ended 31st March 2017 Year ended 31st March 2016 Year ended 31st March 2017 Year ended 31st March 2016
Total Revenue (net) 5409.84 4364.07 6499.03 5067.96
Profit before Finance Cost Depreciation & Amortization expenses and Tax 1526.33 736.82 1730.76 941.04
Finance Cost 295.70 598.28 303.41 601.44
Depreciation and Amortization expenses 174.75 180.35 176.93 358.31
Profit/(Loss) before exceptional items and tax 1055.88 (41.81) 1250.42 (18.71)
Add: Exceptional/Extraordinary Items and Prior Period Adjustments (103.45) (7.57) (110.12) (7.96)
Profit/(Loss) before tax 952.43 (49.38) 1140.30 (26.67)
Less: Current Tax 168.36 0.00 209.65 (103.00)
Less: Deferred Tax 52.96 19.81 77.67 20.31
Less: Provision for tax 0.00 (116.80) (0.91) 8.59
Profit / (Loss) after tax 731.11 47.61 853.89 47.43
Add: Share/Loss of Profit from Associates 0.00 0.00 (2.53) 2.36
Add : Minority Interest 0.00 0.00 (0.02) (0.01)
Profit /(Loss) for the year 731.11 47.61 851.34 49.79

FINANCIAL PERFORMANCE:

As required under the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 a consolidated financial statement of the Company is attached. Theconsolidated financial statements have been prepared in accordance with the relevantaccounting standards as prescribed under Section 133 of the Companies Act 2013 read withRule 7 of the Companies (Accounts) Rules 2014.

On Standalone basis:

The total income of the Company for the year under review stood at ' 5409.84 Lakhs(previous year 4364.07 Lakhs). During the year the Company earned net profit of ' 731.11Lakhs (previous year profit of ' 47.61 Lakhs).

On Consolidated Basis:

The total income of the Company for the year under review stood at ' 6499.03 Lakhs(previous year ' 5067.96 Lakhs). During the year the Company earned net profit of ' 851.34Lakhs (previous year profit of ' 49.79 Lakhs).

FINANCIAL STATEMENTS:

As required under the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 a consolidated financial statement of the Company is attached. Theconsolidated financial statements have been prepared in accordance with the relevantaccounting standards as prescribed under Section 133 of the Companies Act 2013 read withRule 7 of the Companies (Accounts) Rules 2014.

SHARE CAPITAL:

As on March 312017 the paid up equity share capital of the company was '303116000i.e. 30311600 equity shares of ' 10 each. There was no change in Paid-up Share Capitalof the Company during the Financial Year 2016-17.

DIVIDEND:

In order to conserve the resources for future business requirements your Directors donot recommend dividend for the year under review.

PUBLIC DEPOSITS:

During the year under review the Company has not accepted any deposits within themeaning of Section 73 and 76 of the Companies Act 2013 read with Companies (Acceptance ofDeposits) Rules 2014.

EXTRACT OF ANNUAL RETURN:

An extract of Annual Return in Form MGT 9 is appended to this Report as Annexure - 1.

DIRECTORS AND KEY MANAGERIAL PERSONNEL:

In accordance with the provisions of Section 152 of the Companies Act 2013 read withCompanies (Management & Administration) Rules 2014 and Articles of Association of theCompany Mr. Vaibhav Shah Managing Director of the Company retires by rotation at theensuing Annual General Meeting and being eligible has offered himself for re-appointment.

Your Board recommends their appointment / re-appointment of the above Director.

The Company has formulated code of conduct on appointment of directors and seniormanagement. This code of conduct can be accessed on the website of the Company at the linkhttps://www.mnclgroup.com/investor-relation/investor-relation-code-of-conduct

Additional Information on directors recommended for appointment/re-appointment asrequired under Regulation 26 (3) of the SEBI (Listing and Obligation DisclosureRequirements) Regulations 2015 at ensuing Annual General Meeting is given in the Noticeconvening 24th Annual General Meeting.

MEETINGS OF THE BOARD:

The Board meets at regular intervals to discuss and decide on Company and businessstrategies. The notice of Board meeting is given well in advance to all the Directors ofthe Company. Usually meetings of the Board are held in the registered office of theCompany. The agenda of the Board / Committee meetings is circulated 7 days prior to thedate of the meeting.

The Board met 13 (Thirteen) times during the year the details of which are given inthe Report on Corporate Governance. The intervening gap between the two consecutivemeetings was within the period prescribed under the Companies Act 2013 and the ListingAgreement.

ANNUAL PERFORMANCE EVALUATION BY THE BOARD:

SEBI (Listing and Obligation Disclosure Requirements) Regulations 2015 mandates thatthe Board shall monitor and review the Board evaluation framework. The framework includesthe evaluation of directors on various parameters such as:

i. Board dynamics and relationships

ii. Information flows

iii. Decision-making

iv. Relationship with stakeholders

v. Company performance and strategy

vi. Tracking Board and committee's effectiveness

vii. Peer evaluation

Pursuant to the provisions of the Companies Act 2013 a formal annual evaluation needsto be made by the Board of its own performance and that of its committees and individualdirectors. Schedule IV of the Companies Act 2013 states that the performance evaluationof the independent directors shall be done by the entire Board of Directors excluding thedirector being evaluated. The Board works with the nomination and remuneration committeeto lay down the evaluation criteria.

The Board has carried out an evaluation of its own performance the directorsindividually as well as the evaluation of the working of its Audit Committee Nomination& Remuneration Committee and Stakeholders Relationship Committees of the Company. TheBoard has devised questionnaire to evaluate the performances of each of executivenon-executive and Independent Directors. Such questions are prepared considering thebusiness of the Company and the expectations that the Board have from each of theDirectors. The evaluation framework for assessing the performance of Directors comprisesof the following key areas:

i. Attendance of Board Meetings and Board Committee Meetings;

ii. Quality of contribution to Board deliberations;

iii. Strategic perspectives or inputs regarding future growth of Company and itsperformance;

iv. Providing perspectives and feedback going beyond information provided by themanagement.

v. Ability to contribute to and monitor our corporate governance practices DECLARARTIONBY INDEPENDENT DIRECTORS:

The Company has received necessary declaration from all the Independent Directors ofthe Company under sub-section (7) of Section 149 of the Companies Act 2013 confirmingthat they meet the criteria of independence as prescribed under sub-section (6) of Section149 of the Companies Act 2013 and Regulation 25 of the SEBI (Listing and ObligationDisclosure Requirements) Regulations 2015.

COMMITTEES OF THE BOARD:

There are currently three Committees of the Board as follows:

1. Audit Committee

2. Stakeholders' Relationship Committee

3. Nomination and Remuneration Committee

Details of all the Committees along with their charters composition and meetings heldduring the year are provided in the Report on Corporate Governance and forms part of thisAnnual Report.

AUDIT COMMITTEE AND ITS COMPOSITION:

The Audit Committee is duly constituted as per the provisions of Section 177 of theCompanies Act 2013 and SEBI (Listing and Obligation

Disclosure Requirements) Regulations 2015. The composition of the Audit Committee isgiven in Report on Corporate Governance which is annexed to this report.

The Audit Committee of the Company reviews the reports to be submitted to the Board ofDirectors with respect to auditing and accounting matters. It also supervises theCompany's internal control and financial reporting process.

WHISTLE BLOWER POLICY:

The Company has adopted a Vigil mechanism / Whistle blower Policy to deal with instanceof fraud and mismanagement if any. The Company had established a mechanism for directorsand employees to report concerns about unethical behavior actual or suspected fraud orviolation of our Code of Conduct and Ethics. The mechanism also provides for adequatesafeguards against victimization of directors and employees who avail of the mechanism andalso provide for direct access to the Chairman of the Audit Committee in the exceptionalcases. The details of the Vigil mechanism Policy is explained in the report of CorporateGovernance and also posted on the website of the Company at www.mnclgroup.com . We affirm that during the financialyear 2016-2017 no employee or director was denied access to the Audit Committee.

REMUNERATION POLICY:

Pursuant to provisions of Section 178 of the Companies Act 2013 and SEBI (Listing andObligation Disclosure Requirements) Regulations 2015 and on the recommendation of theNomination and Remuneration Committee the Board has adopted a Policy on criteria forappointment of Directors Key Managerial Personnel Senior Management and theirremuneration. The salient features of the Remuneration Policy are stated in the Report onCorporate Governance which forms part of this Annual Report.

RISKS AND AREAS OF CONCERN:

The Company has laid down a well-defined Risk Management Policy to identify the riskanalyse and to undertake risk mitigation actions. The Board of Directors regularlyundertakes the detailed exercise for identification and steps to control them through awell-defined procedure.

DIRECTORS' RESPONSIBILITY STATEMENT:

As required under Section 134(3)(c) of the Companies Act 2013 and according to theinformation and explanations received by the Board your Directors state that:

a. in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating 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 and ofthe 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 this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;

d. the directors have prepared the annual accounts on 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; and

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.

SUBSIDIARIES AND ASSOCIATE COMPANIES:

The company has incorporated a new subsidiary company "Monarch Networth CapitalIFSC Private Limited" on 14th March 2017. Since there are no activities carried outduring the financial year 2016-17 accounts has not been merged in Consolidated FinancialStatement of the Company.

The Company has 6 (six) Subsidiary Companies as on 31st March 2017. During the yearthe Board of Directors ('the Board') reviewed the affairs of the subsidiaries. Inaccordance with Section 129(3) of the Companies Act 2013 we have prepared consolidatedfinancial statements of the Company and all its subsidiaries except for "MonarchNetworth Capital IFSC Private Limited" which form part of the Annual Report.Further a statement containing the salient features of the financial statement of oursubsidiaries in the prescribed format AOC-1 is appended as Annexure II to the Board'sreport. The statement also provides the details of performance financial positions ofeach of the subsidiaries.

The Company does not have any Joint Venture.

In accordance with Section 136 of the Companies Act 2013 the audited financialstatements including the consolidated financial statements and related information of theCompany and audited accounts of each of its subsidiaries are available on the Company'swebsite www.mnclgroup.com . These documents will also be available for inspection at theregistered office of the Company and of the subsidiary companies during business hours onall working days and during the Annual General Meeting.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:

The details of loans guarantee or investment under Section 186 of the Companies Act2013 forms part of Notes to the Financial Statements provided in this Annual Report.

PARTICULARS OF REMUNERATION:

Pursuant to Section 197 of the Companies Act 2013 read with Rule 5(1) of the Companies(Appointment and Remuneration of Managerial personnel Rules 2014 details of the ratio ofremuneration of each Director to the median employee's remuneration are appended to thisreport as

Annexure III.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All Related Policy Transactions entered during the year were in Ordinary Course of theBusiness and on Arm's Length basis. No Material Related Party Transactions entered duringthe year by your Company as per Section 188 of the Companies Act 2013 which requireapproval of the member. Accordingly the disclosure of Related Party Transactions asrequired under Section 134(3) of the Companies Act 2013 in Form AOC-2 is not applicable.

The Policy on materiality of related party transactions and also on dealing withrelated party transactions as approved by the Board may be accessed on the website of theCompany at the link https://www.mnclgroup.com/investor-relation/investor-relation-policy

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 was no significant or material order passed by any regulator or court ortribunal which impacts the going concern status of the Company or will have bearing oncompany's operations in future.

CORPORATE SOCIAL RESPONSIBILITY:

Due to insufficient profits Corporate Social Responsibility is not applicable to theCompany for Financial Year 2016-2017.

STATUTORY AUDITORS:

At the 22nd Annual General Meeting of the Company held on 30th September 2015 M/s.Parekh Shah and Lodha Chartered Accountants Mumbai (having FRN: 107487W) were appointedas Statutory Auditors of the Company to hold office upto the conclusion of 26th AnnualGeneral Meeting. In terms of Section 139 of the Companies Act 2013 the appointment ofthe auditors shall be placed for ratification at every Annual General Meeting of theCompany. Accordingly the appointment of M/s. Parekh Shah and Lodha CharteredAccountants Mumbai (having FRN: 107487W) as Statutory Auditors of the Company is placedfor ratification by the shareholders and to fix remuneration for the financial year ending31st March 2018.

The Auditor's Report for the year ended 31st March 2017 does not contain anyqualification reservation or adverse remark. The Auditor's Report is enclosed withFinancial Statements in this Annual Report.

INTERNAL AUDITOR:

The Company has re-appointed M/s. Nautam Vakil & Co. Chartered AccountantsAhmedabad as its Internal Auditor. The Internal Auditor has given his reports on quarterlybasis to the Audit Committee.

Based on the report of internal audit management undertakes corrective action in therespective areas and strengthens the levels of Internal Financial and other operationalcontrols.

INTERNAL FINANCIAL CONTROL:

The Board has adopted policies and procedures for efficient conduct of business. TheAudit Committee evaluates the efficacy and adequacy of financial control system in theCompany its compliance with operating systems accounting procedures and policies at alllocations of the Company and strives to maintain the Standard in Internal FinancialControl.

SECRETARIAL AUDIT REPORT:

Pursuant to the provisions of Section 204 of the Companies Act 2013 the SecretarialAudit Report received from M/s. VKM & Associates Practising Company SecretariesMumbai is provided in Annexure IV and forms part of this Annual report.

Secretarial Auditor's Remarks:

With respect to the Remark(s)/Observations or disclaimer made by the SecretarialAuditors in their Report we hereby state that the charges appearing on the MCA's Websitewith respect to loan taken from HDFC Bank Limited State Bank of Saurashtra andCorporation Bank have already been satisfied by the Company. However the company is inprocess of obtaining the requisite letter from bank for satisfaction.

STOCK EXCHANGE:

The Equity Shares of the Company are listed at BSE Limited. The Company has paid theAnnual listing fees for the year 2017-2018 to the said Stock Exchange.

CORPORATE GOVERNANCE:

A report on Corporate Governance along with a certificate from the Practicing CompanySecretary of the Company regarding the compliance of conditions of corporate governance asstipulated under Regulation 27(2) of the SEBI (Listing Obligations and DisclosureRequirements) Regulation 2015 forms part of this Annual Report as Annexure V.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

In terms of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 the Management Discussion and Analysis Report which gives a detailedaccount of state of affairs of the Company's operations forms part of this Annual Reportas Annexure VI.

INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013:

The Company has zero tolerance for sexual harassment at workplace and adopted a Policyon prevention prohibition and redressal of sexual harassment at workplace in line withthe provisions of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 and the Rules thereunder. There was no complaint on sexual harassmentduring the year under review.

The policy can be accessed on the website of the Company at the link -https://www.mnclgroup.com/investor-relation/investor-relation-policy .

PARTICULARS OF CONSERVATION OF ENERGY TECHONOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO:

Pursuant to Section 134(3)(m) of the Companies act 2013 read with Rule 8 of theCompanies (accounts) rules 2014 details regarding the Conservation of Energy TechnologyAbsorption and Foreign Exchange Earnings and Outgo for the year under review are asfollows:

A. Conservation of Energy

a. Steps taken or impact on conservation of energy - The Operations of the Company donot consume energy intensively. However the Company continues to implement prudentpractices for saving electricity and other energy resources in day-to-day activities.

b. Steps taken by the Company for utilizing alternate sources of energy - Though theactivities undertaken by the Company are not energy intensive the Company shall explorealternative sources of energy as and when the necessity arises.

c. The capital investment on energy conservation equipment - Nil

B. Technology Absorption

a. The efforts made towards technology absorption - The Company continues to takeprudential measures in respect of technology absorption adaptation and take innovativesteps to use the scarce resources effectively.

b. The benefits derived like product improvement cost reduction product developmentor import substitution- Not Applicable

c. In case of imported technology (imported during the last three years reckoned fromthe beginning of the financial year) - Not Applicable

d. The expenditure incurred on Research and Development - Not Applicable

The Particulars of Foreign Exchange and Outgo for the year under review are as follows:

(Figures in Rs.)

Particulars Year ended 31st March 2017 Year ended 31st March 2016
Foreign exchange earning 8157.12 10841.02
Foreign exchange Outgo Nil Nil

ACKNOWLEDGEMENT:

Your Directors wish to place on record their gratitude and deep appreciation for thecontinued support and co-operation received by the Company from the shareholderscompany's clients suppliers bankers and employees and look forward for their continuedsupport in the future as well.

For and on behalf of the Board of Directors

Place: Mumbai Vaibhav Shah Manju Bafna
Date: 04th September 2017 Chairman cum Managing Director Whole-Time Director