The Members of
PHOTON CAPITAL ADVISORS LIMITED
Your Directors are pleased to present the 35th Annual Reporttogether with audited standalone and consolidated financial statements of the Company forthe financial year ended 31s1 March 2020.
FINANCIAL RESULTS (Amount in Lakhs)
|PARTICULARS || |
|2019-20 ||2018-19 ||2019-20 ||2018-19 |
|Revenue from operations ||12.22 ||7.26 ||12.22 ||7.26 |
|Other Income ||0.11 ||94.13 ||0.11 ||94.13 |
|Total Revenue ||12.33 ||101.39 ||12.33 ||101.39 |
|Total Expenses ||43.02 ||44.26 ||55.68 ||93.21 |
|Profit/(loss) before tax ||(30.69) ||57.13 ||(43.35) ||8.18 |
|Provision for tax (Incl. deferred Tax) ||4.73 ||2.53 ||5.21 ||0.52 |
|Profit/(loss) after tax ||(35.42) ||54.59 ||(48.56) ||7.66 |
|Profit for the Period ||(35.42) ||54.59 ||(48.56) ||7.66 |
REVIEW OF OPERATIONS:
During the financial year under review the company has made revenue ofRs. 12.22 lakhs from operations and Rs. 0.11 lakhs from other income aggregating to Rs.12.33 lakhs and posted a net loss of Rs. (35.42) lakhs as per the audited standalonefinancials for the financial year 2019-20.
During the financial year under review the company has made revenue ofRs. 12.22 lakhs from operations and Rs. 0.11 lakhs from other income aggregating to Rs.12.33 lakhs and posted a net loss of Rs. (48.56) lakhs as per the audited consolidatedfinancials for the financial year 2019-20.
There has been a dramatic reduction of breadth in the stock market thisyear. While the index continues to scale new highs a lot of stocks outside the index havefallen substantially. Even within the index heavy rotation has taken place leading tovery few stocks rising in a secular trend. The other factor which has been weighingheavily on equity markets has been the high valuations. At present your company sees noopportunity to invest in equities. Should the situation change we stand ready to act.
Your Board of Directors has reviewed the affairs of Nicosa ConsultingPrivate Limited Subsidiary Company and included the audited consolidated financialstatements for the financial year 2019-20 in this Annual Report as required under Section134 of the Companies Act 2013. The statement containing the salient features of thefinancial statement of a company's subsidiaries in form AOC-1 is enclosed asAnnexure-I.
MANAGMENT DISCUSSION AND ANALYSIS:
Industry structure and developments:
Except some regulatory changes made by the RBI there have been nosubstantial changes in the NBFC industry as a whole.
Opportunities and threats:
The stock market remains in a risky zone. Government securities offersome possibilities. Your company is in a cautious stance and is not in a hurry to act.
Segment-wise or product-wise performance:
Since the Company does not operate in multiple sectors/segments thesegment wise performances of the financials are not applicable.
The near term outlook remains cloudy because of various measures thatthe government has taken to improve overall functioning of the economy. However in thelong term given favourable demographics and under penetration of various sectors theinvestment outlook remains very bright. Excessive valuations in pubic markets are also amatter of concern.
Risks and concerns:
Your Company has continued to minimize risks from external factors andhas constantly preferred and adopted methods and systems in its economic activities withlow element of risk. In the current and future years your company will further strengthenand bolster its efforts to minimize or negate all risk factors. However external factorsof foreign currencies and impact of global slowdown currency corrections of other largegrowing economies do cause concern to all enterprises and your company does consider thisas a concern. Nevertheless such factors will be dealt with caution and adequateforesight.
Internal financial control systems and their adequacy:
The Company has an Internal Control System commensurate with the sizescale and complexity of its operations. The scope and authority of the Internal Audit (IA)function is defined in the Internal Audit Charter. To maintain its objectivity andindependence the Internal Audit function reports to the Chairman of the Audit Committeeof the Board.
The Internal Audit Department monitors and evaluates the efficacy andadequacy of internal control system in the Company its compliance with operating systemsaccounting procedures and policies at all locations of the Company and its subsidiaries.Based on the report of internal audit function process owners undertake corrective actionin their respective areas and thereby strengthen the controls. Significant auditobservations and corrective actions thereon are presented to the Audit Committee of theBoard.
Material developments in Human Resources / Industrial Relations frontincluding number of people employed:
No major changes in employee's recruitment during the financialyear under review. The company has not made significant development in human resources.
During the financial year under review your board of directors do notrecommend any dividend.
TRANSFER TO RESERVES:
During the financial year under review no amount has been transferredto the reserves.
BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP):
The following changes were taken place in the constitution of the boardof directors of the Company during the period from 01.04.2019 to 31.03.2020:
1. Mr. Tejaswy Nandury resigned from the position of Whole TimeDirector w.e.f. 14.11.2019. However he is continuing as the Director of the Company.
2. Mrs. Sobharani Nandury was appointed as Whole Time Director of theCompany for a period of 5 years w.e.f. 14.11.2019.
As per the provisions of section 152 of the Companies Act 2013 Mr.Tejaswy Nandury who retires by rotation at the ensuing Annual General Meeting and beingeligible offer himself for re-appointment. The board recommends his reappointment.
Five (05) meetings of the Board of Directors were held during thefinancial year and the details are given in paragraph 2 (d) of Corporate Governance reportattached to this Annual Report.
COMPLIANCE OF SECRETARIAL STANDARDS:
During the period under review company has complied with all theapplicable secretarial standards notified under sec 118 (10) of the Companies Act 2013.
EXTRACT OF ANNUAL RETURN:
Pursuant to section 92(3) of the Companies Act 2013 (theAct') and rule 12(1) of the Companies (Management and Administration) Rules 2014extract of annual return in form MGT-9 is enclosed as Annexure II. The copy of extract ofannual return is available at www.pcalindia.com.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
The company has not granted any loans or given any guarantees coveredunder the provisions of section 186 of the Companies Act 2013.
RELATED PARTY TRANSACTIONS:
All transactions entered into with Related Parties as defined under theCompanies Act 2013 and regulation 23 of SEBI(LODR) Regulations 2015 during thefinancial year were in the ordinary course of business and on an arm's length pricingbasis. There were no materially significant transactions with related parties during thefinancial year which were in conflict with the interest of the Company. Suitabledisclosure as required by the Accounting Standards has been made
in the notes to the financial statements. The details of related partytransactions for the Financial Year 2019-20 is enclosed as Annexure-III.
CORPORATE SOCIAL RESPONSIBILITY:
In terms of section 135 of the Companies Act 2013 every companyhaving net worth of rupees five hundred crore or more or turnover of rupees one thousandcrore or more or a net profit of rupees five crore or more during the immediatelypreceding financial year shall constitute CSR Committee and formulate a Corporate SocialResponsibility (CSR) Policy. Since the Company does not fall under the said criteriaduring the immediately preceding financial year the provisions of Sec 135 of theCompanies Act 2013 Schedule VII and the rules made thereunder are not applicable to theCompany.
Accordingly a report on CSR activities as per rule 9 of the Companies(Corporate Social Responsibility) Rules 2014 is not applicable.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION&FOREIGN EXCHANGEEARNINGS AND OUT GO:
The required information as per section 134(3)(m) of the Companies Act2013 is provided hereunder: CONSERVATION OF ENERGY:
The Company has been continuously making efforts to reduce energyconsumption. The management is striving to achieve cost reduction by economical usage ofenergy and to bring a general awareness about energy conservation among employees.
(i) The steps taken or impact on conservation of energy:
The company does not fall in those list of industries which consumeshigh energy resources However the company making efforts to reduce the energyconsumption.
(ii) The steps taken by the company for utilizing alternate source ofenergy:
(iii) The capital investment on energy conservation equipment:
No capital investment made as the company is consuming very lessenergy.
TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUT GO:
There was no technology absorption and no foreign exchange earnings oroutgo during the year under review. Hence the information as required under section134(3)(m) of the Companies Act 2013 read with The Companies (Accounts) Rules 2014 is tobe regarded as Nil.
The Company has not entered into any technology transfer agreement.
PARTICULARS OF EMPLOYEES:
The Company has not employed any individual whose remuneration exceedsthe limits prescribed under the provisions of section 197 of the Companies Act 2013 readwith Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014.
M/s. M. Anandam & Co Chartered Accountants Hyderabad have beenappointed as statutory auditors of Company for a period of five years in the AGM held forthe F.Y. 2016-17. Accordingly they will continue as auditors of the company till theconclusion of the annual general meeting to be held in the year 2021. The Board hasrecommended the remuneration of auditors for the F.Y. 2020-21 to the members at theensuring annual general meeting.
Pursuant to section 138 of the Companies Act 2013 the Board in itsmeeting held on 30.05.2019 has appointed M/s. Bashetty & Joshi Chartered AccountantsHyderabad as Internal Auditors of the company for the financial year 2019-20. SECRETARIALAUDITOR:
Pursuant to the provisions of section 204 of the Companies Act 2013and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theBoard has appointed M/s. SGP & Associates Company Secretaries a firm of CompanySecretaries in Practice to undertake the Secretarial Audit of the Company and the Reporton the Secretarial Audit for the financial year 2019-20 is enclosed herewith as AnnexureIV.
DETAILS FRAUDS REPORTED BY AUDITORS U/S 143:
The auditors have not reported any frauds pursuant to sec.143 (12) ofthe Companies Act 2013. Hence the information to be provided pursuant to section 134 (3)(ca) of the Companies Act 2013 may be treated as NIL.
CONSOLIDATED FINANCIAL STATEMENTS:
The consolidated financial statements of the Company prepared inaccordance with relevant Accounting Standards issued by the Institute of CharteredAccountants of India form part of this Annual Report.
As a listed company necessary measures have been taken to comply withthe listing obligatory Disclosure Requirements (LODR Regulations) with the BSE LtdMumbai. A report on Corporate Governance along with a certificate of compliance from theAuditors forms part of this Report as Annexure- V.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS:
Pursuant to section 134 (3) (d) of the Companies Act 2013 a statementshall be made on declaration given by Independent Directors under sec 149 (6) of theCompanies Act 2013 in the Board report.
The Board has received declarations from the Independent Directors asrequired under Sec 149 (7) of the Companies Act 2013 stating the fulfilment of criteriamentioned in the sub section (6) of Sec 149 of the Companies Act 2013 and the rules madethereunder and recorded the same in the board meeting held on 30.05.2019.
NOMINATION AND REMUNERATION POLICY CRITERIA FOR SELECTION ANDREMUNERATION OF DIRECTORS KMP AND EMPLOYEES:
The Nomination and Remuneration Committee of the Board comprises twoIndependent Non-Executive Directors namely Mr. Narasimha Rao Joga Mr. V.R. Shankara andone Non-Independent Non-Executive Director namely Mrs. Suchitra Nandury.
The key features of the Nomination and Remuneration Policy as framed bythe Nomination and Remuneration Committee of the company are set out below:
Selection criteria for Directors:
The Company shall consider the following aspects while appointing aperson as a Director on the Board of the Company: Skills and Experience: The candidateshall have appropriate skills and experience in one or more fields of finance lawmanagement sales marketing administration public administrative services researchcorporate governance technical operations or any other discipline related to theCompany's business.
Age Limit: The candidate should have completed the age of twenty-one(21) years and should not have attained the age of seventy (70) years for appointment asManaging Director or Whole Time Director.
Conflict of Interest: The candidate should not hold Directorship in anycompetitor company and should not have any conflict of interest with the Company.
Directorship: The number of companies in which the candidate holdsDirectorship should not exceed the number prescribed under the Act.
Independence: The candidate proposed to be appointed as an IndependentDirector should not have any direct or indirect material pecuniary relationship with theCompany and must satisfy the requirements imposed under the Act. The policy provides thatwhile appointing a Director to the Board due consideration will be given to approvals ofthe Board and/or shareholders of the Company in accordance with the Act.
Remuneration for Directors KMP and other Employees:
The policy provides that the remuneration of Directors KMP and otheremployees shall be based on the following key principles:
Pay for performance: Remuneration of Executive Directors KMPand other employees is a balance between fixed and incentive pay reflecting short and longterm performance objectives appropriate to the working of the Company and its goal. Theremuneration of Non-Executive Directors shall be decided by the Board based on the profitsof the Company and industry benchmarks.
Balanced rewards to create sustainable value: The level andcomposition of remuneration is reasonable and sufficient to attract retain and motivatethe Directors and employees of the Company and encourage behaviour that is aligned tosustainable value creation.
Competitive compensation: Total target compensation and benefitsare comparable to peer companies in the industry and commensurate to the qualificationsand experience of the concerned individual.
Business Ethics: Strong governance processes and stringent riskmanagement policies are adhered to in order to safeguard our stakeholders' interest.
The Nomination and Remuneration Policy may be accessed on theCompany's website at the link: http:// www.pcalindia.com
REPLIES TO THE QUALIFICATIONS OF THE AUDITORS UNDER 134 (3) (f):
Since no qualifications have been reported in the Audit report theBoard of Directors need not give any replies in the Annual report.
MATERIAL CHANGES AND COMMITMENTS OCCURRED BETWEEN THE END OF THEFINANCIAL YEAR AND THE DATE OF THE REPORT AFFECTING THE FINANCIAL POSITION OF THE COMPANY:
There were no material changes from the end of the financial year tillthe date of this report affecting the financial position of the Company.
DETAILS OF DEPOSITS UNDER CHAPTER V:
The company has not accepted deposits from the members/public fallingwithin the meaning of section 73 and/or Sec 76 of the Companies Act 2013 and thecompanies (Acceptance of Deposits) Rule2014. Accordingly furnishing of the details ofdeposits which are not in compliance with the requirements of Chapter V of the CompaniesAct 2013 does not arise. MAINTENANCE OF COST RECORDS:
The requirement of maintenance of cost records as specified by theCentral Government under sub-section (1) of section 148 of the Companies Act 2013 is notapplicable to the Company. Accordingly the Company has not maintained such accounts andrecords for the financial year under review.
FORMAL ANNUAL EVALUATION MADE BY THE BOARD OF ITS OWN PERFORMANCE ANDOF ITS COMMITTEES AND INDIVIDUAL DIRECTORS:
Keeping in view the various provisions of the Companies Act 2013 andSEBI (LODR) Regulations 2015 in regard to dealing with powers duties and functions ofthe Board of Directors of the Company your Company has adopted criteria for evaluatingthe performance of its Board Committees and other Directors including IndependentDirectors applicable from the financial year 2019-20. The said criteria contemplatesevaluation of Directors based on their performance as directors apart from their specificrole as independent non-executive and executive directors as mentioned below:
a. Executive Directors being evaluated as Directors as mentionedabove will also be evaluated on the basis of targets / criteria given to executiveDirectors by the board from time to time as well as per their terms of appointment.
b. Independent Directors being evaluated as a Director will also beevaluated on meeting their obligations connected with their independence criteria as wellas adherence with the requirements of professional conduct roles functions and dutiesspecifically applicable to Independent Directors as contained in Schedule IV to theCompanies Act 2013.
The criteria also specifies that the Board would evaluate eachcommittee's performance based on the mandate on which the committee has beenconstituted and the contributions made by each member of the said committee in effectivedischarge of the responsibilities of the said committee. The Board of Directors of yourcompany has made annual evaluation of its performance its committees and directors forthe financial year 2019-20 based on afore stated criteria.
The Enquiry Committee comprises three members namely Mr. J. NarasimhaRao (Chairman & Independent Director) Mr. V.R. Shankara (Independent Director) andMrs. Suchitra Nandury (Non-Independent Director).
The Audit Committee comprises three members namely Mr. J. Narasimha Rao(Chairman & Independent Director) Mr. V.R. Shankara (Independent Director) and Mrs.Suchitra Nandury (Non-Independent Director). All the recommendations made by the AuditCommittee were taken on note by the Board.
The Vigil Mechanism of the Company which also incorporates a whistleblower policy in terms of the SEBI (LODR) Regulations 2015 includes Vigilance and Ethicsofficer Senior executive of the Company. Protected disclosures can be made by a whistleblower through an e-mail or telephone or a letter to the officer or to the Chairman ofthe Audit Committee. The Policy on vigil mechanism and whistle blower policy may beaccessed on the Company's website at the link: http:// www.pcalindia.com.
DETAILS PERTAINING TO REMUNERATION AS REQUIRED UNDER SECTION 197(12) OFTHE COMPANIES ACT 2013 READ WITH RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATIONOF MANAGERIAL PERSONNEL) RULES 2014
(i) The percentage increase in remuneration of each Director ChiefFinancial Officer and Company Secretary during the financial year 2019-20 and ratio of theremuneration of each Director to the median remuneration of the employees of the Companyfor the financial year 2019-20 are as under:
|Sl No ||Name of Dlrector/KMP and Designation ||Remuneration of Director/KMP for financial year 2019-20 ||% increase in Remuneration in the Financial Year 2019-20 ||Ratio of remuneration of each Director to median remuneration of employees |
|1. ||Mr. Tejaswy Nandury Director ||Nil ||Nil ||Nil |
|2. ||Mr. Narasimha Rao Joga Director ||Nil ||Nil ||Nil |
|3. ||Mr. V.R. Shankara Director ||Nil ||Nil ||Nil |
|4. ||Mrs. Sobha Rani Nandury Whole Time Director ||Nil ||Nil ||Nil |
|5. ||Mrs. Suchitra Nandury Director ||Nil ||Nil ||Nil |
|6. ||MS. Neha Agarwal Company Secretary ||210000 ||16.66 ||0.62 |
|7. ||Mr. Sreedhar Babu Kanuri Chief Financial Officer ||1318800 ||10.01 ||3.53 |
(ii) The median monthly remuneration of employees of the Company duringthe financial year was Rs. 29100/-
(iii) In the financial year there was an increase of 10.22% in themedian monthly remuneration of employees;
(iv) There were 5 (Five) permanent employees on the rolls of Company ason March 31 2020;
(v) Average percentage increase made in the salaries of employees otherthan the managerial personnel in the last financial year i.e. 2018 -19 was 12.33% whereasthe increase in the managerial remuneration for the same financial year was 10.87% and itis hereby affirmed that the remuneration paid is as per the Remuneration Policy forDirectors Key Managerial Personnel and other Employees.
Your Directors state that no disclosure or reporting is required inrespect of the following items as there were no transactions
on these items during the financial year under review:
1. Details relating to deposits covered under Chapter V of the Act.
2. Issue of equity shares with differential rights as to dividendvoting or otherwise.
3. Issue of Employee stock option Scheme.
4. Issue of shares (including sweat equity shares) to employees of theCompany under any scheme.
5. Whole-time Directors of the Company did not receive any remunerationor commission from any of its subsidiaries.
6. No significant or material orders were passed by the Regulators orCourts or Tribunals which impact the going concern status and Company's operations infuture.
Your Directors further state that during the financial year underreview there were no cases filed pursuant to the Sexual
Harassment of Women at Workplace (Prevention Prohibition and RedressalAct 2013).
DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to the provisions of Sec 134(3)(c) of the Companies Act 2013the Board of Directors of your Company hereby
certifies and confirms that:
a. In the preparation of the standalone and consolidated Annualfinancial statements the applicable accounting standards have been followed along withproper explanation relating to material departures;
b. The Directors have selected such accounting policies and appliedthem consistently and made judgements and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the loss of the Company for that financial year;
c. The Directors have taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of theCompanies Act 2013 for safeguarding the Assets of the Company and for preventing anddetecting fraud and other irregularities;
d. The Directors have prepared the Annual financial statements on agoing concern basis;
e. The directors has laid down internal financial control to befollowed by the company and that such internal financial controls are adequate andoperating effectively;
f. The directors had devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively.
Your Directors gratefully acknowledge the support and co-operationextended by all the shareholders customers bankers mutual funds share brokers to yourcompany during the financial year and look forward to their continued support.
// On behalf of the Board //
For PHOTON CAPITAL ADVISORS LIMITED
| || ||Sd/- ||Sd/- |
| || ||VRSHANKARA ||SOBHARANI NANDURY |
|Place: ||Hyderabad ||DIRECTOR ||WHOLE-TIME DIRECTOR |
|Date : ||13.08.2020 ||DIN:00041705 ||DIN: 00567002 |