To the Members
The Directors present the Annual Report of Nalin Lease Finance Limited (the Company orNLFL) along with the audited financial statements for the financial year ended March 312019.
1. Financial results
| || |
(Amount in Rs.)
|Particulars || |
| ||Current year ended 31.03.2019 ||Previous year ended 31.03.2018 |
|Gross Income ||37968630 ||35383439 |
|Less Expenses ||20541416 ||21161804 |
|Profit before Tax ||17427214 ||14120646 |
|Less Tax Expenses ||4703775 ||3991201 |
|Profit after Tax ||12723439 ||10129445 |
|Earnings Per Share (Rs.) ||3.90 ||3.11 |
|Reserves & Surplus ||88681429 ||75957990 |
|Fixed Assets (Net) ||2367242 ||2788394 |
|Borrowings ||61471646 ||73830234 |
No dividend is being recommended by the Directors for the year ending on 31st March2019. As the Board of Directors wants to plough back the profit in the business.
3. Transfer to reserves
The closing balance of the Reserves and Surplus of the Company for FY 2019 after allappropriation and adjustments was Rs. 88681429.
4. Company's performance
The total revenue for FY 2019 was Rs. 37968630 higher by 7.31 percent over theprevious year's revenue of Rs. 35383439 in FY 2018. The PAT attributable to shareholdersfor FY 2019 was Rs. 12723439 registering a growth of 25.61 percent over the PAT ofRs.10129445 for FY 2018.
5. 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 and there are no material departures;
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 profitof the Company for that period;
iii. They have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
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 andsuch internal financial controls are adequate and operating effectively;
vi. They have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.
Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company the work performed by the internal statutoryand secretarial auditors including the audit of internal financial controls overfinancial reporting by the statutory auditors and the reviews performed by management andthe relevant board committees including the audit committee the Board is of the opinionthat the Company's internal financial controls were adequate and effective during FY 2019.
6. Directors and key managerial personnel
Harsh Dilipkumar Gandhi retires by rotation and being eligible offers himself forreappointment. A resolution seeking shareholders' approval for his re-appointment formspart of the Notice.
Narendrakumar Dalsukhdas Shah was appointed as an independent director at the 23rdAnnual General Meeting (AGM) held on June 24 2014 for a period of five years. Based onthe recommendation of the Nomination and Remuneration Committee his re-appointment for asecond term of five years is proposed at the ensuing AGM for the approval of the Membersby way of special resolution.
Navinchandra Chandulal Soni was appointed as independent director at the 23rdAGM of the Company held on June 24 2014 for the period of five years. Based on therecommendation of the Nomination and Remuneration Committee his re-appointment for asecond term of five years is proposed at the ensuing AGM for the approval of the Membersby way of special resolution.
The Board places on record its appreciation for their invaluable contribution andguidance.
Pursuant to the provisions of Section 149 of the Act the independent directors havesubmitted declarations that each of them meet the criteria of independence as provided inSection 149(6) of the Act along with Rules framed thereunder and Regulation 16(1) (b) ofthe Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 ("SEBI Listing Regulations"). There has been nochange in the circumstances affecting their status as independent directors of theCompany.
During the year under review the non-executive directors of the Company had nopecuniary relationship or transactions with the Company.
Pursuant to the provisions of Section 203 of the Act the Key Managerial Personnel ofthe Company as on March 31 2019 are:
Dilipkumar Nalinkant Gandhi Managing Director
Pallavi Dilipkumar Gandhi Whole-time Director
Harsh Dilipkumar Gandhi Whole-time Director
Nikul K Patel Chief Financial Officer and Swati Ajay Shah Company Secretary.
7. Number of meetings of the Board
Six meetings of the Board were held during the year under review. For details ofmeetings of the Board please refer to the Corporate Governance Report which is a part ofthis report.
8. Board evaluation
The Board of Directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act and SEBIListing Regulations.
The performance of the board was evaluated by the board after seeking inputs from allthe directors on the basis of criteria such as the board composition and structureeffectiveness of board processes information and functioning etc.
The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of criteria such as the composition of committeeseffectiveness of committee meetings etc.
In a separate meeting of independent directors performance of non-independentdirectors the board as a whole and the Chairman of the Company were evaluated takinginto account the views of executive directors and nonexecutive directors.
In the board meeting that followed the meeting of the independent directors and meetingof Nomination and Remuneration Committee the performance of the board its committeesand individual directors was also discussed.
Performance evaluation of independent directors was done by the entire board excludingthe independent director being evaluated.
9. Internal financial control systems and their adequacy
The details in respect of internal financial control and their adequacy are included inthe Management Discussion and Analysis which is a part of this report.
10. Audit committee
The details pertaining to the composition of the audit committee are included in theCorporate Governance Report which is a part of this report.
M/s. PARESH THOTHAWALA & CO. Chartered Accountants (Firm Registration No.102245W)the Statutory Auditors of the Company will be eligible for appointment in ensuing generalmeeting.
Your Company has received letter from M/s. PARESH THOTHAWALA & CO CharteredAccountants to the effect that their appointment if made would be within the prescribedlimits under Section 141 of the Companies Act 2013 read with rules made there under andthat they are not disqualified for such appointment.
Your Directors recommend the appointment of M/s. PARESH THOTHAWALA & CO CharteredAccountants as Statutory Auditors of the Company to hold office from the conclusion ofthis Annual General Meeting (AGM) till the conclusion of 29th Annual GeneralMeeting of the Company to be held in the calendar year 2020.
12. Auditor's report and secretarial audit report
The statutory auditor's report and the secretarial audit report do not contain anyqualifications reservations or adverse remarks or disclaimer. Secretarial audit reportis attached to this report as Annexure III.
13. Risk management
The Audit Committee has additional oversight in the area of financial risks andcontrols. The major risks identified by the businesses and functions are systematicallyaddressed through mitigating actions on a continuing basis.
14. Particulars of loans guarantees and investments
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
15. Transactions with related parties
None of the transactions with related parties falls under the scope of Section 188(1)of the Act. The information on transactions with related parties pursuant to Section134(3) (h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules 2014 aregiven in Annexure I in Form No- AOC-2 and the same forms part of this report.
16. Corporate Social Responsibility
This provision is not applicable to the Company.
17. Extract of annual return
As per the requirements of Section 92(3) of the Act and Rules framed thereunder theextract of the annual return for FY 2019 is given in Annexure II in the prescribedForm No- MGT-9 which is a part of this report. The same is available onwww.nalinfin.co.in.
18. Particulars of employees
The information required under Section 197 of the Act read with Rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is given below:
a. The ratio of the remuneration of each director to the median remuneration of theemployees of the Company and percentage increase in remuneration of each Director ChiefExecutive Officer Chief Financial Officer and Company Secretary in the financial year:
|Name ||% increase in remuneration in the financial year |
|Non-executive directors || |
|Narendrakumar D Shah* ||N.A. |
|Navinchandra C Soni* ||N.A. |
|Samir K Shah* ||N.A. |
|Executive directors || |
|Dilipkumar Gandhi ||7.31 |
|Pallavi D Gandhi ||7.31 |
|Harsh D Gandhi ||7.31 |
|Chief Financial Officer || |
|Nikul K Patel ||5.71 |
|Company Secretary || |
|Swati A Shah ||Nil |
*No payment is made to Non-executive Independent Directors
b. The percentage decrease in the median remuneration of employees in the financialyear: 6.88 percent
c. The number of permanent employees on the rolls of Company: 05
d. Increase in the managerial remuneration for the year was 7.31 percent.
19. Disclosure requirements
As per SEBI Listing Regulations the Corporate Governance Report with the Auditors'Certificate thereon and the Management Discussion and Analysis are attached which formspart of this report.
The Company has devised proper systems to ensure compliance with the provisions of allapplicable Secretarial Standards issued by the Institute of Company Secretaries of Indiaand that such systems are adequate and operating effectively.
20. Deposits from public
The Company has not accepted any deposits from public and as such no amount on accountof principal or interest on deposits from public was outstanding as on the date of thebalance sheet.
The Directors thank the Company's employees customers vendors and investors for theircontinuous support.
The Directors also thank the Government of India Governments of Gujarat and concernedGovernment departments and agencies for their co-operation.
The Directors appreciate and value the contribution made by every member of the NLFLfamily.
| ||On behalf of the Board of Directors |
| ||Narendrakumar D Shah |
|Himatnagar May 24 2019 ||Chairman |