To The Members
Your Directors have pleasure in presenting 34th Annual Report on the business andoperations of the Company along with the Audited Statements of Accounts for the year ended31st March 2019.
|Financial Highlights ||2018-2019 ||2017-2018 |
| ||(Rs. in lakhs) ||(Rs. in lakhs) |
|Profit before Tax ||174.46 ||137.43 |
|Less/(Add): Tax expenses ||(10.18) ||(15.22) |
|Net Profit after Tax ||184.64 ||152.65 |
During the year end under review the Indian democratic has given resounding mandateto the running Government of India for another term of 5 years that reflects the clarityof purpose of the people of India. It is an endorsement of this stable Government inpushing through the government's efforts for the developmental and economic agenda andthis Governments commitment to continue with the policy reforms in all critical sectorssuch as infrastructure natural resources manufacturing and financial services.
As against global economic growth at a steady 3 percent our country's Gross DomesticProduct (GDP) is estimated to grow by 7.3% in 2019 and 7.5% in 2020 making our Countryone of the few large emerging economies outperforming the others. The world is looking atIndia to play the role of the lead growth engine a role China played for almost threedecades.
Overview of Financial Performance
The above mentioned positive developments in the Indian economy had a positive impactboth on the business and revenues of the Company during the year end under review thatreflected in Company's both revenue segment that is Investment Banking Income both inEquity and Debt segment and other being investment activities in Government Securities /Corporate Bonds.
The company's standalone income from operations during the Financial Year 2018-19 wasincreased by 16% to Rs.3232.68 lakhs as compared to Rs.2780.52 lakhs during previousFinancial Year 2017-18 and also consolidated Income from operations increased toRs.3700.87 lakhs as against Rs. 3349.80 lakhs in the previous year.
No material changes and commitments have occurred after the close of the year till thedate of this Report which affect the financial position of the Company.
During the year under review the Company's Issued Subscribed and Paid up Equity ShareCapital remains unchanged at Rs.1229.69 lakhs as at March 31st 2019.
Due to miniscule increase in profit the Board of Directors of the Company has decidednot to recommend dividend for the Financial Year 2018-19.
During the Financial Year 2018-19 there were no changes in status of existing sixwholly owned subsidiaries as compared to previous year.
Performance and Financial Position of Subsidiaries
As required under Rule 5 and Rule 8(1) of the Companies (Accounts) Rules 2014 areport on the highlights of performance of subsidiaries and their contribution to theoverall performance of the Company is appended as Annexure 7 to the AnnualReport. Pursuant to the provisions of Section 129(3) of the Act a statement containingsalient features of financial statement of subsidiaries in Form AOC-1 is annexed to theConsolidated Financial Statement in the Annual Report.
Consolidated Financial Statements
Pursuant to Section 129(3) of the Companies Act 2013 a consolidated financialstatement of the Company along with its 6(six) Wholly owned Subsidiaries has been preparedin the same form and manner as that of the Company which shall be laid before the ensuingAGM along with the laying of the Company's Standalone Financial Statement under Section129(2).
Further pursuant to the provisions of Accounting Standard (AS-21) the ConsolidatedFinancial Statements notified under Section 133 of the Companies Act 2013 read togetherwith Rule 7 of the Companies (Accounts) Rules 2014 issued by the Ministry of CorporateAffairs the Consolidated Financial Statements of the Company along with its six Whollyowned subsidiaries for the year ended March 31 2019 forms part of this Annual Report.
The Board of Directors of the Company has resolved not to publish and attach copies ofthe standalone Annual Audited Accounts of all its existing subsidiaries and instead topublish the Consolidated Accounts pursuant to Section 136(1) of the Act. Annual AuditedAccounts of all its existing subsidiaries can also be obtained by members of the Companyby making written request to the Company. The Accounts of these subsidiaries are alsoavailable for inspection to members of the Company at the Registered Office of the Companyduring the Company's business hours. The Company has attached the Consolidated FinancialStatements in this Annual Report which includes Accounts of all its six existingsubsidiaries.
Directors Responsibility Statement
Your Directors state that:
I) In the preparation of the Annual Accounts for the year ended 31st March 2019 theapplicable Accounting Standards read with requirements set out under Schedule III of theCompanies Act 2013 have been followed and there are no material departures from the same;
ii) They have selected such accounting policies and have applied them consistently andmade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at 31st March 2019 and of the Profit ofthe Company for the year ended on that date;
iii) They have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 1956 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
iv) The annexed Annual Accounts for the Accounting Year ended on 31st March 2019 havebeen prepared on a going concern basis;
v) They have laid down internal financial controls to be followed by the Company andthe 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 operating effectively.
Management Discussion and Analysis
The Management Discussion and Analysis Report for the year under review is given as aseparate
Directors and Key Management Personnel
During the year end under review there was no change in the composition of the Boardof Directors of the Company. After the year end Mr. Athreya Tyagarajan Krishnakumar (DIN:00926304) was appointed as an Additional Director (Independent Non-executive) by theBoard of Directors of the Company w.e.f. 23rd August 2019 pursuant to the provisions ofSection 161 and other applicable provisions of the Companies Act 2013 (the 'Act') holdsoffice up to the date of this Annual General Meeting of the Company or the last date onwhich the Annual General Meeting should have been held.
Mr. A. T. Krishnakumar is a MBA with nearly Four (4) decades of experience in ofManagement consultancy Corporate Planning Diversification and RestructuringInternational Collaboration and technology tie ups mergers and Acquisition.
The Nomination & Remuneration Committee ('N&RC') had assessed the profile ofMr. Krishnakumar and having found him to be 'Fit and Proper' recommended his appointmentto the Board of Directors. In terms of Sections 149 152 160 read with Schedule IV of theAct the Board of Directors of the Company basis the recommendation of the N&RC havereviewed the profile of Mr. Krishnakumar and the declarations that he meets the criteriaof independence as prescribed both under sub-section (6) of Section 149 of the Act andunder Regulation 16(1) (b) of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 and the Board is of opinionthat he fulfils the criteria of independence.
In the opinion of the Board Mr. Krishnakumar meets the fit and proper criteria and isa person of integrity and has the necessary knowledge experience and expertise for beingappointed as an Independent Director. Considering his vast expertise and knowledge in thefield of Accountancy Finance Corporate Advisory Taxation and Management Consultancy itwould be in the interest of the Company that Mr. Krishnakumar is appointed as anIndependent Director on the Board of the Company.
During the year end under review Mr. Rakesh Bhatia Chief Financial Officer (CFO) ofthe Company has resigned w.e.f. 1st June 2018 due to ill health consequently Board ofDirectors of the Company has appointed Mr. Sanjay Kabra as CFO of the Company.
The Board of Directors of the Company place on record sincere appreciation andgratitude to Mr. Rakesh Bhatia for his valuable contribution in the growth anddevelopment of PINC Group during his tenure and wish him all the best.
Your Company has laid down Policy in which criteria for performance evaluation of theDirectors including Chairperson Managing Director Board Committees and Board as a wholein line with the provisions of the Companies Act 2013 and SEBI's LODR Regulations. ThePolicy continued to assist the Company the manner in which formal annual evaluation shouldbe made.
Corporate Governance is an ethically driven business process that is committed tovalues aimed at enhancing an organization's brand and reputation. This is ensured bytaking ethical business decisions and conducting business with a firm commitment tovalues while meeting stakeholders' expectations. As part of the Company's efforts towardsbetter corporate practice and transparency a separate report on Corporate Governancecompliances is included in the Annual Report.
Contracts and Arrangement with Related Parties
There were no materially significant transactions with related parties includingpromoters directors key managerial personnel subsidiaries or relatives of the Directorsduring the financial year which could lead to a potential conflict with the interestbetween the company and these parties. The details of the transactions with relatedparties if any were placed before the Audit Committee from time to time. There were nomaterial individual transactions with related parties which were not in the ordinarycourse of business of the Company nor were there any transactions with related partieswhich were not on arm's length basis. Accordingly the disclosure in Form AOC-2 is notapplicable to the Company for the year under review. Suitable disclosure as required bythe Accounting Standards (AS-18) has been made in the notes to the Financial Statements.
Prior omnibus approval for normal day to day transactions is also obtained from theAudit Committee for the related party transactions which are repetitive in nature as wellas for the business transactions which cannot be foreseen and accordingly the requireddisclosures are made to the Committee for their approval.
The Policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed on the Company's website atwww.pinc.co.in. Your Directors draw attention of the members to Note no.30 to thefinancial statement which sets out related party transactions disclosures.
Corporate Social Responsibility (CSR)
In compliance with Section 135 of the Companies Act 2013 read with the Companies(Corporate Social Responsibility Policy) Rules 2014 your Company has establishedCorporate Social Responsibility ('CSR') Committee. During the financial year 2018-19 theCompany has spent Rs.13.25 lakhs on CSR activities as approved by the Board of theCompany. The disclosure in the Annual Report on CSR activities is annexed herewith markedas Annexure 2.
Risk Management Policy
Company's Risk Management Policy continued to guide the Board on risk assessmentmanagement and contributes to controls manage measure and mitigate the risk faced by thecompany in the day to day operation. The Risk Management policy intends to cover seriousconcerns that could have risk impact on the operations and performance of the business ofthe Company as well as its Wholly Owned Subsidiaries.
Internal Financial Controls
Your Company has implemented adequate procedures and internal controls which providereasonable assurance regarding reliability of financial reporting and preparation offinancial statements. Further the Board also ensures regularly that Internal Financialcontrols are functioning efficiently in the ordinary course of business.
Employee Stock Option Scheme
The Employee Stock Option Plans are administered by the Nomination & RemunerationCommittee of the Board. The disclosures required to be made in the Directors' Report inrespect of Employees Option Schemes in terms of the SEBI (Employee Stock Option Scheme)Guidelines 1999 are mentioned in the Annexure 3 forming part of the Directors' Report.
Out of the 1314000 Stock Options granted to the Employees of the Company by theNomination and Remuneration Committee second tranche of 25% of granted Stock options hasbeen vested during the year end under review as per the terms and conditions of thegrant.
Auditors and Auditors Report
provisions of the Companies Act 2013 and the Rules made thereunder relating tomandatory rotation of Statutory Auditors the Company has obtained members approval in theAGM to appoint J. D. Jhaveri & Associates Chartered Accountant (Firm Reg. no.111850W) as the statutory auditors of the Company to hold office for a period of fiveconsecutive years commencing from the Financial Year 2017-18 on a remuneration that maybe determined by the audit committee in consultation with the auditors and that suchremuneration may be paid on a progressive billing basis. However such appointment issubject to ratification by the members of the Company at the Annual General Meeting of theCompany as per the applicable provisions of the Companies Act 2013 and the Rules madethereunder. Accordingly the appointment of J. D. Jhaveri & Associates CharteredAccountant (Firm Reg. no. 111850W) as the statutory auditors of the Company is beingplaced before the members of the Company for ratification.
The Notes to the Accounts referred to in the Auditors' Report are self-explanatory andtherefore do not call for any further explanation. The Auditors' Report does not containany qualification reservation or adverse remark.
Pursuant to Section 204 of the Companies Act 2013 your Company had appointed Mr. AspiBhesania Practicing Company Secretary (ICSI membership number: 6119 C.P. no.9657) as itsSecretarial Auditors to conduct the secretarial audit of the Company for the financialyear 2018-19. The Company provided all assistance and facilities to the SecretarialAuditors for conducting audit. The Report of Secretarial Auditor for the financial year2018-19 is annexed to this report as Annexure 4. There are no observations reservationsor adverse remarks in the Secretarial Audit Report.
The Audit Committee comprises of Independent Directors namely Mr. C C. Dalal(Chairman) Mr. A. B. Desai Mrs. K.C. Maniar and also Managing Director Mr. G. M. Gandhi.All the recommendations made by the Audit Committee were accepted by the Board during theFinancial Year 2018-19.
In line with the provisions of Listing Regulations the Companies Act 2013 and theprinciples of good governance your Company has devised and implemented a vigil mechanismin the form of 'Whistle Blower Policy' for the directors and employees to report genuineconcerns in such manner as may be prescribed. Such a vigil mechanism shall provide foradequate safeguards against victimization of persons who use such mechanism and also makeprovision for direct access to the chairperson of the Audit Committee in appropriate orexceptional cases. The Policy on vigil mechanism and whistle blower policy may be accessedon the Company's website at www.pinc.co.in.
Meetings of the Board
Four meetings of the Board of Directors were held during the year. For further detailsplease refer separate report on Corporate Governance forming part of Annual Report.
Declaration from Independent Directors
The Company has received declaration from all the Independent Directors of the Companyconfirming that they meet with the criteria of independence as per sub-section (6) ofSection 149 of the Companies Act 2013 and also the criteria of independence as mentionedin Regulation 16(1)(b) and Regulation 25(8) of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 ('Listing Regulations').
Particulars of Loans given Investments made Guarantees given and Securities provided
Particulars of loans given investments made guarantees given and securities providedcovered under the provision of Section 186 of the Act are given in the notes to theStandalone Financial Statement.
Conservation of Energy Technology Absorption Foreign Earnings and Expenditures.
The Company has no activities involving conservation of Energy and Technologyabsorption.
The details of Company's foreign exchange earnings and expenditures during the yearunder review are given in Note no. 25 to the standalone financial statement.
The Company complies with all applicable mandatory secretarial standards issued by theInstitute of Company Secretaries of India.
Extract of Annual Return
Extract of Annual Return of the Company is annexed herewith as Annexure 5 to thisReport.
Familiarization Programs for Independent Directors
Details of programs that were undertaken for familiarizing the Independent Directorscan be accessed on the Company's website at www.pinc.co.in.
Investor Education and Protection Fund (IEPF)
Pursuant to the applicable provisions of the Companies Act 2013 read with the IEPFAuthority (Accounting Audit Transfer and Refund) Rules 2016 (the Rules)all unpaid or unclaimed dividends which remains unclaimed or unpaid for seven years fromthe date of transfer to unpaid account are required to be transferred by the Company tothe IEPF established by the Central Government.
Further according to the Rules the shares in respect of which dividend have not beenclaimed or paid by the shareholders for seven consecutive years or more shall also betransferred to the Demat Account created by the IEPF Authority.
The following are the details of dividend paid by the Company and its respective duedate of transfer of such fund to the Central Government which remains unpaid:
|Sr. No ||Date of Declaration ||Dividend for the year ||Due date of transfer to the government |
|1 ||07th September 2012 ||Dividend 2011-12 ||07th October 2019. |
Members wishing to claim dividends which have remained unclaimed are requested tocorrespond with Registrar and Share Transfer Agents (RTA) or Company Secretary at theCompany's registered office.
Further the corresponding shares will be transferred as per the requirements of IEPFrules details of which will be provided on Company's website www.pinc.co.in.
Particulars of Employees and related disclosures
In accordance with the provisions of Section 197(12) of the Act the ratio of theremuneration of each Director to the median employee's remuneration and other details interms of sub-section 12 of Section 197 of the Act read with Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is appended asAnnexure 6 to the Annual Report.
In terms of first proviso to Section 136 of the Act the Report and FinancialStatements are being sent to the Members and others entitled thereto excluding theinformation on employees' particulars as required pursuant to provisions of Rule 5(2) and5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.
In accordance with the provisions of Section 197 of the Act read with Rule 5(2) and5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014the annexure pertaining to the names and other particulars of employees is available forinspection at the Registered Office of the Company during the business hours on workingdays of the Company up to the date of the ensuing AGM. Any shareholder interested inobtaining a copy of the said Annexure may write to the Company Secretary & ComplianceOfficer in this regard.
The Board of Directors affirms that the remuneration paid to employees of the Companyis as per the Nomination and Remuneration Policy of the Company.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the 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 dividend voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company underany scheme save and except ESOS referred to in this Report.
4. Neither the Managing Director nor the Whole-time Directors of the Company receiveany remuneration or commission from any of its subsidiaries.
5. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.
Your Directors further state that during the year under review there was no casesfiled pursuant to the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.
The Board wishes to express its deep appreciation to all the staff members for theirexcellent contribution and to the Bankers shareholders and customers for their continuedsupport.
| ||On behalf of the Board of Directors || |
|Mumbai ||G. M. Gandhi ||C. C. Dalal |
|23rd August 2019. ||Managing Director ||Director |
| ||(DIN - 00008057) ||(DIN - 00091132) |