To the Members
Your directors are pleased to present the Twenty-Sixth Annual Report on the businessand operations of the Company together with the Audited Financial Statements for yearended March 31 2020.
A summary of the Company's financial results for the Financial Year 2019-20 is asunder:-
(Amount in Rupees Lakhs)
|PARTICULARS ||Current Financial Year (2019-20) ||Previous Financial Year (2018-19) |
|Revenue from Operations ||417.00 ||199.71 |
|Other Income ||- ||- |
|Profit/loss before Depreciation Finance Costs Exceptional items and Tax Expense ||(205.41) ||32.93 |
|Less: Depreciation/Amortisation/Impairment ||54.40 ||12.18 |
|Profit/Loss before Finance Costs Exceptional Items and Tax Expense ||(259.81) ||20.75 |
|Less: Finance Cost ||81.17 ||2.26 |
|Profit/Loss before Exceptional Items and Tax Expense ||(340.98) ||18.49 |
|Add/(less): Exceptional items ||- ||- |
|Profit/Loss before Tax Expense ||(340.98) || |
|Less: Tax Expense (Current & Deferred) ||13.82 ||(4.75) |
|Profit/loss for the year (1) ||(354.80) ||23.24 |
|Retained earnings as at the beginning of the year ||(4.73) ||(23.57) |
|Profit after Tax ||(354.80) ||23.24 |
|Retained earnings before appropriations ||(359.53) ||(0.33) |
|Appropriations || || |
|Less: Transfer to reserve fund u/s 45-IC(1) of the RBI Act 1934 ||- ||4.40 |
|Less: Dividend paid on Equity Shares ||- ||- |
|Less: Dividend Distribution Tax ||- ||- |
|Less: Other Appropriation ||0.01 ||- |
|Retained earnings as at the end of the year ||(359.54) ||(4.73) |
|Earnings per share (Face value of Rs.10/-) || || |
|- Basic (Rs.) ||(1.77) ||0.14 |
|- Diluted (Rs.) ||(1.77) ||0.14 |
The Revenue from operations for the year under review has been Rs. 417.00 lakhs(Previous Year: Rs. 199.71 lakhs) registering a growth of 108.80% over the previous year.The Operating Loss stood at Rs. 340.98 lakh as against operating Profit of Rs. 18.49 lakhin the Previous Year. The Net Loss for the year stood at Rs. 354.80 lakh against Profit ofRs. 23.24 lakh in the Previous Year.
Total income during FY2020 increased to Rs. 417.00 Lakhs from Rs. 199.71 Lakhs duringthe year. The profit after tax for the year under review was (Rs. 354.80 Lakh) as comparedto Profit of Rs. 23.24 Lakhs for as on 31 March 2019.
The Assets Under Management (AUM) as on 31 March 2020 stood at Rs. 3913.21 Lakh ascompared to Rs. 1750.42 Lakh as on 31 March 2019 registering an increase of 123.56% overthe previous year. Loans receivables as on 31 March 2020 were Rs. 2929.02 Lakhs ascompared to Rs. 97.44 Lakhs as on 31 March 2019 registering an increase of 2905.97% overthe previous year.
CIRCULATION OF ANNUAL REPORTS IN ELECTRONIC FORM
In view of the prevailing COVID-19 situation and consequent lockdown across thecountry the Ministry of Corporate Affairs (MCA) has exempted companies from circulationof physical copies of Annual Report for FY2020. Accordingly the Annual Report of theCompany for FY2020 is being sent only by email to the members and all otherpersons/entities entitled to receive the same. This Annual Report along with otherdocuments is also available on the Company's website at www.moneyboxxfinance.com.
The Company has occurred loss during the period under review the Board of Directors ofthe Company has not recommended any dividend for the Financial Year 2019-20.
During the period under review no amount has been transferred to reserves.
As on March 31 2020 the Authorized Share Capital of the Company stood at Rs.250000000/- (25000000 equity shares of Rs. 10/- each) and the Issued Subscribed andPaid-up Share Capital of the Company stood at Rs. 200816510 divided into 20081651equity shares of Rs. 10/- each.
During the period under review the Company has made allotment by way of:
The Company has issued and allotted 1674346 Bonus shares to the Equity Shareholdersin the ratio of 1:10 (i.e. One fully paid up equity share of Rs. 10/ - each for every tenfully paid up equity shares).
Preferential issue of shares by way of Private Placement:
The Company has issued and allotted 1663846 shares Equity Shares of face value of Rs.10/- each at a premium of Rs. 60/- per share aggregating to Rs. 70/- per equity share onpreferential basis by way of Private Placement.
LISTING ON STOCK EXCHANGE
The Company's shares are listed on Main Platform of BSE Limited. The listing fee forthe financial year 2020-21 has been paid.
MORATORIUM OF LOANS
The Reserve Bank of India issued guidelines on 27 March 2020 permitting all commercialbanks co-operative banks All India Financial Institutions and NBFCs to give moratoriumto customers in respect of instalments falling due between March 01 2020 to August 312020. Accordingly the Company offered moratorium to its customer's as per the policyapproved by the Board.
The COVID-19 pandemic has caused a huge disruption creating an unprecedented impact onthe financial well-being of nations corporations and individuals. A detailed discussionon impact of COVID-19 on the NBFC sector and operations of the Company is covered in theManagement Discussion and Analysis.'
STATE OF THE COMPANY'S AFFAIRS
Migration of Equity Shares from BSE SME Platform to BSE Mainboard Platform:
The equity shares of the Company which were listed on BSE SME Platform has now beenmigrated & admitted to dealings on the Main Board Platform of BSE Limited w.e.f.October 22 2019.
Accordingly the trading lot size of the Company's shares on the BSE browser has beenreduced from 10000 shares to 1 share.
CHANGE IN THE NATURE OF BUSINESS
There have been no changes in the nature of business of the company for the periodunder review.
MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY HAVING OCCURRED SINCE THE END OF THE YEAR AND TILL THE DATE OF THE REPORT
There have been no material changes and commitments which affect the financialposition of the company which have occurred between the end of the financial year to whichthe financial statements relate and the date of this Report.
CORPORATE SOCIAL RESPONSIBILITY
Your Company does not fall within the provisions of section 135 of the Companies Act2013 relating to Corporate Social Responsibility (CSR) provisions. Hence details ofexpenditures on CSR are not required to be furnished.
HIGHLIGHTS OF PERFORMANCE OF SUBSIDIARIES ASSOCIATES AND JOINT VENTURE COMPANIES ANDTHEIR CONTRIBUTION TO THE OVERALL PERFORMANCE OF THE COMPANY
The Company does not have any subsidiary associate or joint venture company thereforethe statement containing the salient features of the financial statement of subsidiariesassociates or joint ventures under the first proviso to sub-section (3) of section 129 inForm AOC-1 is not applicable.
DIRECTORS AND KMP
During the year under review:
Mr. PrashantAgarwal (DIN: 08019634) had resigned from the designation of ChiefFinancial Officer (CFO) Co-Chief Executive Officer (Co-CEO) of the Board w. e. f. June29 2020.
Mr. PrashantAgarwal (DIN: 08019634) had resigned from the Directorship of the companyas Whole-time Director and KMP of the Company w.e.f. September 09 2020. Your Directorsexpress their sincere thanks and appreciation for the contribution made by him.
Mr. Mayur Modi (DIN: 08021679) was designated as Chief Financial Officer (CFO) & asa KMP of the Company w.e.f. June 29 2020.
Mr. Mayur Modi (DIN: 08021679) had resigned as Chief Financial Officer (CFO) of theCompany w.e.f. September 15 2020.
Mr. Deepak Aggarwal (DIN: 03140334) Non-Executive Non Independent Director ofthe Company was appointed and re-designated as Whole-time Director of the Company subjectto the approval of shareholders in the ensuing General Meeting w.e.f. September 15 2020to hold office for a term of 3 (three) consecutive years.
Mr. Deepak Aggarwal (DIN: 03140334) was further designated as Chief Financial Officer(CFO) Co-Chief Executive Officer (Co-CEO) & as a KMP of the Company w.e.f. September15 2020. Pursuant to the provisions of Section 161(1) of the Companies Act 2013 and theArticles of Association of the Company:
Mr. Atul Garg (DIN: 07093376) was appointed as additional Director of the Companyw.e.f. September 15 2020 and holds office up to the date of the ensuing Annual GeneralMeeting. Board recommends their appointment as Director of the Company.
Director retiring by rotation:
Mr. Govind Gupta (DIN: 00065603) Director retires by rotation from the Board pursuantto the provisions of section 152(6) (c) of the Companies Act 2013 and being eligibleoffers himself for reappointment.
The Board recommends the appointment of Mr. Govind Gupta (DIN: 00065603) as Director ofthe Company retiring by rotation.
During the year under review the non-executive directors of the Company had nopecuniary relationship or transactions with the Company other than rent paid sittingfees and reimbursement of expenses incurred by them for and on behalf of the Company.
As required under regulation 36(3) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the information on the particulars of the Directorsproposed for appointment / reappointment has been given in the Notice of the AnnualGeneral Meeting.
As on date the Company had 6 Directors and 3 Key Managerial Personnel.
|S. No. ||Name of Director ||Designation |
|1. ||Mr. Uma Shankar Paliwal ||Chairman cum Independent Director |
|2. ||Ms. Ratna Dharashree Vishwanathan ||Independent Director |
|3. ||Mr. Deepak Aggarwal ||Whole-time Director Chief Financial Officer & Co- Chief Executive Officer (KMP) |
|4. ||Mr. Mayur Modi ||Whole-time Director Co- Chief Executive Officer (KMP) |
|5. ||Mr. Govind Gupta ||Non-Executive Director |
|6. ||Mr. Atul Garg ||Non-Executive Director |
|7. ||Ms. Radhika Garg ||Company Secretary & Compliance Officer (KMP) |
NUMBER OF MEETINGS OF THE BOARD
The Board met 5 times during the financial year. The meeting details are provided inthe Corporate Governance Report' that forms part of this Annual Report. The maximuminterval between any two meetings did not exceed 120 days as prescribed in the CompaniesAct 2013.
COMMITTEES OF THE BOARD
There are four (4) committees constituted by the Board:
1. Audit Committee
2. Nomination and Remuneration Committee
3. Stakeholder Relationship Committee
4. Executive committee
The details pertaining to the composition of the Audit Committee are included in theCorporate Governance Report which is a part of this report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Act the Board of Directors to the best of itsknowledge and ability confirm that:
i. in the preparation of the annual accounts the applicable accounting standards havebeen followed alongwith proper explanation relating to material departures if any;
ii. they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year and of the profit& loss of the Company for the financial year 2019-20 ;
iii. 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
iv. they have prepared the annual accounts on a going concern basis.
v. they have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and are operating effectively; and vi.they have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and are operating effectively
DECLARATION BY INDEPENDENT DIRECTORS
The independent directors have submitted a declaration of independence stating thatthey meet the criteria of independence provided under section 149(6) of the Act asamended and regulation 16 of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015. There has been no change inthe circumstances affecting their status as independent directors of the Company.
The Board took on record the declaration and confirmation submitted by the independentdirectors regarding them meeting the prescribed criteria of independence afterundertaking due assessment of the veracity of the same in terms of the requirements ofregulation 25 of the SEBI Listing Regulations.
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The current policy is to have an appropriate mix of executive non-executive andindependent directors to maintain the independence of the Board and separate itsfunctions of governance and management. As of March 31 2020 the Board had six memberstwo of whom are executive Directors two are non -executive and non-independent member andtwo non-executive independent directors. One of the Independent directors of the board iswoman.
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 CompaniesAct2013 is available on our website athttp://moneyboxxfinance.com/images/pdf/Nomination-Remuneration-policy.pdf
We affirm that the remuneration paid to the directors is as per the terms laid out inthe Nomination and Remuneration Policy of the Company.
The Board adopted a formal mechanism for evaluating its performance and as well as thatof its Committees and individual Directors including the Chairman of the Board. The Boardof Directors has carried out an annual evaluation of its own performance boardcommittees and individual directors pursuant to the provisions of the Act and SEBIListing Regulations. The performance of the board & its committees was evaluated bythe board after seeking inputs from all the directors on the basis of criteria such as theboard composition and structure effectiveness of board processes information andfunctioning etc.
In a separate meeting of independent directors performance of non-independentdirectors and the board as a whole was evaluated taking into account the views ofexecutive directors and non-executive directors.
Your Company has not invited/received/accepted any fixed deposits during the year assuch no amount of principal or interest on fixed deposits was outstanding on the date ofBalance Sheet. Therefore the disclosures as required under the Companies Act 2013 andthe Rules framed thereunder and RBI Directions are not applicable.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis Report as required under the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 is provided in a separatesection and forms an integral part of this Report.
PARTICULAR OF EMPLOYEES
In accordance with the provisions of Section 197(12) of the Act read with Rule 5 of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 a statementcontaining the disclosures pertaining to remuneration and other details as required underthe Act and the above Rules are appended to this Report as Annexure - A.
The statement containing particulars of employees as required under Section 197 of theCompanies Act 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 will be provided upon request. In terms of Section 136of the Companies Act 2013 the Report and Accounts are being sent to the Members andothers entitled thereto excluding the information on employees' particulars which isavailable for inspection by the members at the Registered Office of the Company duringbusiness hours on working days of the Company.
If any member is interested in obtaining a copy thereof such Member may write to theCompany Secretary in this regard.
EXTRACT OF ANNUAL RETURN
The extract of annual return as provided under section 92(3) of the Act in theprescribed form no. MGT-9 would be available at the website of the Company atwww.moneyboxxfinance.com.
To the Company its people are a very valuable resource. In an increasingly competitivemarket for talent the Company continues to focus on attracting and retaining righttalent. It is committed to provide right opportunities to employees to realise theirpotential.
During the year the Company had conducted structured familiar interactions between theemployees of the Company and imparted programmes with regard to sharing information aboutthe Company's long term perspective its growth along with the growth of employees.
The Company had also conducted the training programme with respect to AML/CFT areaswhich inter alia includes familiarization with the AML/CFT guidelines issued by theReserve Bank of India (RBI) from time to time.
Your Company practices a culture that is built on core values and ethical governancepractices. Your Company is committed to transparency in all its dealings and places highemphasis on business ethics. The Report on Corporate Governance for the Financial Yearended March 31 2020 along with the certificate from the Statutory Auditors of the Companyconfirming the compliance with regulations of corporate governance under the SEBI ListingRegulations is annexed to the Report on Corporate Governance and forms part of thisReport.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a Whistle Blower Policy to report genuine concerns or grievances &to provide adequate safeguards against victimization of persons who may use suchmechanism.
There was no reporting made by any employee for violations of applicable laws andregulations and the Code of Conduct for the F.Y. 2019-20.
INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has put in place adequate internal controls with reference to accuracy andcompleteness of the accounting records and timely preparation of reliable financialinformation commensurate with the size scale and complexity of operations and ensurescompliance with various policies and statutes in keeping with the organization's pace ofgrowth increasing complexity of operations prevention and detection of frauds anderrors. The design and effectiveness of key controls were tested and no materialweaknesses were observed. The Audit Committee reviews and evaluates the adequacy ofinternal financial control and risk management systems periodically. Efficacy of Internalcontrol systems are tested periodically by Internal Auditors with and Internal Controlover financial reporting is tested and certified by Statutory Auditors.
The internal financial control system of the Company is supplemented with internalaudits regular reviews by the management and checks by external auditors.
The Statutory Auditors of the Company have audited the internal financial controls overfinancial reporting of the Company as of March 31 2020 in conjunction with audit of thefinancial statements of the Company for the year ended on that date and Annexure A'to the Auditor's Report may be referred to in this regard.
AUDIT AND AUDITORS
(a) Statutory Auditor
At the 25th AGM held on September 30 2019 the Members approved appointment of Gaur& Associates Chartered Accountants (Firm Registration No. 005354C) as StatutoryAuditors of the Company to hold office for a period of five years from the conclusion ofthe 25th AGM till the conclusion of the 30th AGM for the financial year starting fromApril 01 2019 to March 31 2024.
There is no qualification reservation or adverse remark for the year under review.
(b) Secretarial Auditor
Pursuant to the provisions of Section 204 of the Act and rules made thereunder theCompany had appointed Messrs Shashank Sharma & Associates a firm of CompanySecretaries in Practice (C.P No. 7221) to undertake the Secretarial Audit of the Company.The Secretarial Audit Report for the financial year ended as on March 31 2020 is annexedas Annexure B and forms an integral part of this Report.
There is no qualification for the year under review.
As per the provisions of Section 148 read with the Cost Audit Rules the provisionsregarding Cost Audit is not applicable to the Company.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
The Company being a non-banking financial company registered with RBI and engaged inthe business of giving loans is exempt from the provisions of section 186 of the Act inrespect of loans and guarantees. Accordingly the disclosures of the loans given asrequired under the aforesaid section have not been made in this Report.
RELATED PARTY TRANSACTIONS
All related party transactions entered during FY 2019-20 were on an arm's length basisand in the ordinary course of business under the Act and were entered with the approval ofthe Audit Committee/Board of Directors in line with provisions of the Act and SEBI ListingRegulations. There was no materially significant related party transaction under the Actor the SEBI Listing Regulations which had a potential conflict with the interest of theCompany at large. None of the transactions required members' prior approval under the Actor the SEBI Listing Regulations. Accordingly the disclosure of Related Party Transactionsas required under Section 134(3) (h) of the Companies Act 2013 in Form AOC 2 is notapplicable. The Directors draw attention of the members to Note No. 27 of the Notes to theFinancial Statements which sets out related party transactions.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS / OUTGO
Particulars regarding conservation of energy & technology absorption as required tobe disclosed pursuant to the Rule 8(3) of the Companies (Accounts) Rules 2014 are asunder.
(A) Conservation of Energy-
|(i) the steps taken or impact on conservation of energy ||The Company's operations involve low energy consumption and wherever possible energy conservation measures have already been implemented. |
|(ii) the steps taken by the company for utilising alternate sources of energy ||Efforts to conserve and optimize the use of energy through improved operational methods and other mean will continue as an on-going basis. |
|(iii) the capital investment on energy conservation equipment's ||NA |
(B) Technology absorption-
|(i) the efforts made towards technology absorption ||Since the company is primarily engaged in NBFC activities the minimum technology required for the business has been absorbed. |
|(ii) the benefits derived like product improvement cost reduction product development or import substitution ||NA |
|(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)- ||NA |
|(a) the details of technology imported; || |
|(b) the year of import; || |
|(c) whether the technology been fully absorbed; || |
|(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof; and || |
|(iv) the expenditure incurred on Research and Development. ||NA |
(C) Foreign exchange earnings and Outgo-:
There were no foreign exchange earnings and outgo during the year under review(previous year): NIL
The Board of Directors have adopted a risk management policy for the Company whichprovides for identification assessment and control of risks which in the opinion of theBoard may threaten the existence of the Company. The Management identifies and controlsrisks through a properly defined framework in terms of the aforesaid policy.
REPORTING OF FRAUDS BY AUDITORS
There was no instance of fraud during the year under review which required theStatutory Auditors / Secretarial Auditors to report to the Audit committee and / or Boardunder Section 143(12) of the Act and the rules made thereunder.
SECRETARIAL STANDARDS OF ICSI
Your Directors confirm that the Secretarial Standards issued by the Institute ofCompany Secretaries of India as applicable on the Company have been complied with.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
During the year under review no significant and material orders were passed by anyregulator or court or tribunal impacting the going concern status and Company's operationsin future.
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013
The Company has adopted a Policy on prevention prohibition and redressal of sexualharassment at workplace in line with the provisions of the Sexual Harassment of Women atworkplace (Prevention Prohibition and Redressal) Act 2013 and the Rules made thereunder.
The Company has also formed an Internal Complaints Committee which is responsible forredressal of complaints related to sexual harassment and follows the guidelines providedin the policy.
The Company has not received any complaints on sexual harassment during the year.
The Directors express their sincere gratitude to the Reserve Bank of India Securitiesand Exchange Board of India BSE Limited Ministry of Finance Ministry of CorporateAffairs Registrar of Companies other government and regulatory authorities lendersfinancial institutions and the Company's bankers for the ongoing support extended by them.The Directors also place on record their sincere appreciation for the continued supportextended by the Company's stakeholders and trust reposed by them in the Company. TheDirectors sincerely appreciate the commitment displayed by the employees of the across alllevels resulting in successful performance during the year.