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Rithwik Facility Management Services Ltd.

BSE: 540843 Sector: Others
NSE: N.A. ISIN Code: INE819Y01015
BSE 00:00 | 22 Jun Rithwik Facility Management Services Ltd
NSE 05:30 | 01 Jan Rithwik Facility Management Services Ltd
OPEN 55.00
PREVIOUS CLOSE 55.00
VOLUME 3000
52-Week high 78.00
52-Week low 38.50
P/E 10.34
Mkt Cap.(Rs cr) 17
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 55.00
CLOSE 55.00
VOLUME 3000
52-Week high 78.00
52-Week low 38.50
P/E 10.34
Mkt Cap.(Rs cr) 17
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Rithwik Facility Management Services Ltd. (RITHWIKFACILITY) - Director Report

Company director report

Dear Members

Your Directors present their Report together with the audited financial statements ofyour Company for the year ended March 31 2020.

31st March2020 31st March 2019
Particulars (Rs. in Lakhs) (Rs. in Lakhs)
Revenue from Operation 2625.96 2728.22
Profit/(Loss) before Finance Cost 261.93 213.51
Depreciation Exceptional items and Taxes
Less: Finance Cost 8.48 13.11
Less: Depreciation 33.31 30.79
Profit/(Loss) before exceptional and extraordinary items 220.12 169.61
Less: Exceptional items - -
Profit / (Loss) before tax 220.12 169.61
Less: Tax Expenses 57.19 49.75
Profit / (Loss) After tax 162.93 119.86

OPERATIONS

During the year under review the turnover of the Company was Rs.2625.96 lakhs ascompared to Rs. 2728.22 lakhs in the previous year. This year profits are from the coreactivities of the business .There were no turnkey projects executed. Hence the revenuefrom operation has come down to 2625.96 lakhs.

CHANGE IN THE NATURE OF THE BUSINESS

During the year there is no change in the nature of the business of the Company.

DIVIDEND

Your Company has made profit after Tax of Rs.162.93 lakhs your Directors decided toretain the profits for further expansion and have not recommended any dividend for theyear ended 31st March 2020.

ECONOMIC OVERVIEW - INDIA

India has emerged as the fastest growing major economy in the world and is expected tobe one of the top three economic powers in the world over the next 10-15 years backed byits robust democracy and strong partnerships.

Market size

India's gross domestic product (GDP) (at constant 2011-12 prices) was estimated to beRs 145.65 lakh crore (US$ 2.06 trillion) for 2019-20 growing 4.2 per cent over theprevious year. India retained its position as the third largest start-up base in the worldwith over 8900-9300 start-ups as 1300 new start-ups got incorporated in 2019 accordingto a report by NASSCOM. India also witnessed the addition of 7 unicorns in 2019 (tillAugust 2019) taking the total tally to 24. India's labour force is expected to touch160-170 million by 2020 based on the rate of population growth increased labour forceparticipation and higher education enrolment among other factors according to a study byASSOCHAM and Thought Arbitrage Research Institute. India's foreign exchange reserves roseto a record high in the last week of the previous month. Data released by the Reserve Bankof India on Friday showed that forex reserves rose $11.9 billion in the week ended July31 taking total reserves to $534 billion.

Recent Developments

With an improvement in the economic scenario there have been investments acrossvarious sectors of the economy. The mergers and acquisition (M&A) activity in Indiastood at US$ 28 billion in 2019 while private equity (PE) deals reached US$ 48 billion.Some of the important recent developments in Indian economy are as follows:

? Merchandise export and import (in US$ terms) declined by 4.8 per cent and 9.1 percent respectively in 2019-20.

? Nikkei India Manufacturing Purchasing Managers' Index (PMI) stood at 30.8 in May2020 showing contraction in the sector because of coronavirus-related restrictions.

? Gross tax revenue stood at Rs 15.04 lakh crore (US$ 215.28 billion) in 2019-20 incometax collection contributed Rs 4.80 lakh crore (US$ 68.14 billion) to it..

? In 2019 companies in India raised around US$ 2.5 billion through 17 initial publicoffers (IPO).

? India's Foreign Direct Investment (FDI) equity inflow reached US$ 469.99 billionbetween April 2000 to March 2020 with maximum contribution from services computersoftware and hardware telecommunications construction trading and automobiles.

? India's Index of Industrial Production (IIP) for 2019-20 stood at 129.2.

? The combined index of eight core industries stood at 137 in March 2020. Itscumulative growth was 0.6 per cent in 2019-20.

? Consumer Price Index (CPI) Combined inflation was 5.9 per cent in March 2020 ascompared to 6.6 per cent in February 2020. The annual consumer price inflation increasedto 4.8 per cent in 2019-20 from 3.4 per cent in 2018-19.

? Around 12 million jobs in a year were created in India during 2015-19.

? India improved its ranking in World Bank's Doing Business Report by 14 spots overlast year and was ranked 63 among 190 countries in the 2020 edition of the report.

? India is expected to have 100000 start-ups by 2025 which will create employment for3.25 million people and generate US$ 500 billion in value as per Mr T V Mohan Das PaiChairman Manipal Global Education.

Road Ahead

India's GDP is expected to reach US$ 5 trillion by FY25 and achieve upper-middle incomestatus on the back of digitization globalization favorable demographics and reforms.India is also focusing on renewable sources to generate energy. It is planning to achieve40 per cent of its energy from non-fossil sources by 2030 which is currently 30 per centand have plans to increase its renewable energy capacity from to 175 giga watt (GW) by2022. India is expected to be the third largest consumer economy as its consumption maytriple to US$ 4 trillion by 2025 owing to shift in consumer behavior and expenditurepattern according to a Boston Consulting Group (BCG) report. It is estimated to surpassUSA to become the second largest economy in terms of purchasing power parity (PPP) by 2040as per a report by Price water house Coopers.

IMPACT OF COVID 19 in Leasing of office spaces in India

Net leasing of office space plunged 73.4 per cent in the April-June period across eightmajor cities due to sharp fall in demand because of the COVID-19 pandemic according toCushman & Wakefield.Net absorption of office space stood at 37.15 lakh sq ft duringApril-June 2020 as against 139.85 lakh sq ft in the year ago period as corporate andco-working players deferred their expansion plans the property consultant said. Duringthe first half of 2020 the net office space leasing declined 57 per cent to 110.75 lakhsq ft from 255.48 lakh sq ft in the corresponding period of last calendar year.

"The net absorption in the second quarter 2020 stands at 3.72 million sq ft whichis lower by 49.5 per cent on a quarterly basis and 73.4 per cent lower on a yearly basisas fresh transaction activity was muted during the quarter" C&W said in astatement. Also cities like Delhi NCR and Bengaluru saw negative absorption which alsopushed the overall net absorption downwards it added. "As the world got more engagedto deal with the impact of corona virus the resilience of commercial real estate in Indiawas tested. This is reflected in the dwindling demand and supply numbers in H1 2020"said Anshul Jain Managing Director South East Asia and India C&W.

In an ever-evolving situation he said it would be difficult to predict the timelinewithin which commercial real estate in India might be able to restore its pre-COVID growthmomentum. "But a certain level of normalcy could be expected in H2 as companiesgradually resume their operations" Jain said. According to the data net leasing inMumbai rose to 16.45 lakh sq ft during April-June 2020 from 12.72 lakh sq ft in thecorresponding period last year. In Delhi-NCR the net leasing of office space stood atminus 3.58 lakh sq ft as against 9.52 lakh sq ft during the period under review.Similarly Bengaluru reported a negative net leasing of office space at minus 83943 sq ftas against 23.63 lakh sq ft.

Net office space leasing in Chennai fell to 5.23 lakh sq ft from 11.65 lakh sq ftwhile Pune saw a sharp fall to 60709 sq ft from 15.85 lakh sq ft.

In Hyderabad demand for office space declined to 17.58 lakh sq ft from 57.78 lakh sqft. Net office space leasing in Kolkata dipped to 1.14 lakh sq ft from 2.24 lakh sq ftwhile in Ahmedabad the demand softened to 54900 sq ft from 6.43 lakh sq ft. Cushman &Wakefield which is listed on the New York Stock Exchange is a leading largest realestate services firm with approximately 53000 employees in 400 offices and 60 countries.In 2019 the firm had revenue of USD 8.8 billion across core services of propertyfacilities and project management leasing capital markets valuation and other services.

REVIEW OF OPERATIONS

During the year under review your company has recorded 22% of increase at 261.93 Lakhsin profit as compared to 213.51 Lakhs as on 31st March 2019. During the yearyour company has not executed any turnkey projects. The growth of the Profit is attributedto efficient handling of Manpower reduced costs in input materials and effective internalcontrols system of the company.

FACILITIES UNDER O&M

Particulars 31st March 2018-19 31st March 2019-20
Total Area of Maintenance in Sq.ft. 650241 777497
Total No. of clients under maintenance 70 73

FUTURE PROSPECTS

The COVID-19 outbreak has acted as a catalyst for change and has reiterated the need topay attention to how facilities are being managed and services are being delivered. Allbuilt environments owned or leased offices warehouses retail stores or manufacturingfacilities will require careful consideration and tailored plans.

With health and wellness becoming key focus areas organizations may prefer to hireprofessional and trained facilities managers to drive such initiatives. As we moveforward the role of FM services providers can also become more strategic and long-term innature with facets like hygiene and safety gaining importance for everyone. Technology andchanging attitudes will drive increased sophistication in facilities management. The roleof facility management is emerging from just being a service provider to promoting aculture anchored by safe work practices quality talent development technology andanalytics.

The Covid-19 pandemic has forced companies to reset the ongoing soft services tosupport the workplace environment. There is a growing need for automating FM businessprocesses everything from move-ins service requests and maintenance to energymanagement or workspace customization. Facilities managers must leverage data for betterdecision making capital planning and improving the workplace experience for employees andcustomers alike.

In the post Covid times smart technologies will add greater significance given thatfacilities will be occupied in a gradual manner and better control and intelligence willbe needed to operate buildings in a very dynamic environment with varied occupancypattern. Quick changes remote monitoring and operations and data analytics are expectedto bring efficiency in this dynamically changing occupancy.

The concept of smart buildings is pushing facility managers to rediscover the use andintegrations of buildings into one single eco-system. Every asset or device within thebuilding such as lights sensors windows HVAC units doors and CCTV having a uniqueidentity and all fully integrated into a network. Artificial Intelligence and IoTtechnologies can increase operational efficiency and improve building management byallowing distantly monitoring and controlling facilities.

Your company continues to explore all the possibilities in exploring new methodologiesand technologies with regard to the facility management services with a holistic approachof providing end to end solutions for the clients. Your company is also exploring thepossibilities of entering into contract to lease equipments for IT/ ITEs companies whichwill in turn contribute to the growth of the Company.

Although there is a shift from Work from office to Work from home the industry is notcomfortable with this practice on a permanent basis. As they have found that it is notpractically workable for multiple purposes.

SHARE CAPITAL

The Authorised capital of the company is 400 Lakhs as on 31st March 2020.The paid up capital of the Company as on 31st March 2020 stands at Rs. 306Lakhs.

TRANSFER TO RESERVES Your Company has not proposed any sum to the general reserveof the Company. CORPORATE GOVERNANCE

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. At Rithwik Facility Management ServicesLimited it is imperative that our company affairs are managed in a fair and transparentmanner. This is vital to gain and retain the trust of our stakeholders. The Company iscommitted to maintain the highest standards of corporate governance and adhere to thecorporate governance requirements set out by SEBI.

As per the Regulation 15(2)(a) of Chapter IV of Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015; The compliance withthe Corporate Governance provisions as specified in regulations 1717A 18 19 20 212223 2424A25 26 27 and clauses (b) to (i) of sub-regulation (2) of regulation 46and para C D and E of Schedule V shall not apply in respect of

a) the Listed entity having paid up Equity share capital not exceeding Rs. 10 Crore andNet-worth not exceeding of 25 Crore as on the last day of the Previous financialyear:

b)the Listed entity which has listed its specified securities on the SME Exchange.

Your Company is listed in BSE SME platform. Thus the compliance with provisions ofCorporate Governance in accordance with Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 is not applicable to yourCompany.

MANAGEMENT DISCUSSION AND ANALYSIS :

In terms of provisions of Regulation 34 of Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 (hereinafterreferred to as Listing Regulations) the Management Discussion and Analysis Report isappended as Annexure IV to this report.

PARTICULARS OF EMPLOYEES

Your Company has no employee who is in receipt of remuneration of Rs.850000/- permonth or Rs.10200000/- per annum and hence the Company is not required to giveinformation under Sub Rule 2 and 3 of the Rule 5 of the Companies (Appointment andRemuneration of Managerial Personnel) Rules2014.

Further the Nomination and remuneration policy forms part of Annexure V to the

Board's Report:

? Disclosure under Rule 5 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014- Annexure VI

COMPOSITION & CATEGORY OF DIRECTORS:

The board comprises of 5 Directors; out of which 2 are Executive Director and 2 areNon-Executive and Independent Directors and 1 woman non-executive and IndependentDirector. All the Directors bring a wide range of skills and experience to the board. TheIndependent Directors have confirmed that they satisfy the criteria prescribed for anIndependent Director as stipulated under the provisions of Section 149(6) of the CompaniesAct 2013. All directors are appointed by the members of the Company.

The composition of the Board is in conformity with Listing Regulations. No director canbe a member in more than 10 committees or act as chairman of more than 5 committees acrossall public companies in which he is a director.

A) Details with regards to meeting of Board of Directors and attendance during the yearof the Company

(i) Composition of the Board of Directors as on the date of this Report is mentionedbelow;

Name of the Director Designation Category
Mr. RithwikRajshekar Raman Managing Director Executive Director
Mr. V Niranjan Rao Whole-Time Director Executive Director
Mr.Sudhakar P Director Independent Director
Mrs.ShamaPrasannaTipparaju Woman Director Independent Director
Mr.Jayaraman Director Independent Director

(ii) Meeting of Board of Directors and Attendance during the Year:

During the FY 2019-2020 Seven (7) meetings of the Board of Directors of the Companywere held which is listed in the table. There is no gap between two meetings that exceed120 days.

Quarter I (April- June) Quarter II (July- September) Quarter III (October to December) Quarter IV (January March)
08-04-2019 14-08-2019 20-01-2020
28-05-2019 26-08-2019 14-11-2019
14-06-2019
Name

Category

Number of Directorsh ip in other public Ltd Companie s

No. of Board Meetings attended during period ended 31/03/2020

No. of Committee Membershi p in other Public Limited Companies

Atte nd- ance Last AGM on

No. of Shares held

Mr.Rithwik Executive
Rajshekar Non-Independent Nil 6 Nil Yes 1102500
Raman Chairman
Promoter cum
Managing Director
Mr.Niranjan Executive
Vyakarna Rao Non-Independent Nil 7 Nil Yes 13500
Whole-Time
Director
Mr.P Sudhakar Non-Executive
Independent 01 6 1 Yes Nil
Director
Mrs.Shama Non-Executive
Prasanna Independent Nil 6 Nil Yes. Nil
Tipparaju Director
Mr.Jayaraman Non-Executive
Independent Nil 4 Nil Yes Nil
Director

In accordance with Regulation 26 (1) (b) of SEBI (Listing Obligations & DisclosureRequirements) Regulations 2015 Membership/Chairpersonship of only the Audit

Committees and Stakeholders' Relationship Committee in all Public Limited

Companies has been considered.

(C) Policy on Directorsf 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 on 31st March 2020 the Board consist of 5Members 1 of whom is a Managing Director 1 of whom is an Whole-time Director and the 2others are Independent Directors and 1 woman non-executive and Independent Director. TheBoard periodically evaluates the need for change in its composition and size. The Policyof the Company on Director's Appointment and

Remuneration including criteria for determining qualifications positive attributesindependence of director and other matters provided under Section 178(3) of the CompaniesAct 2013 adopted by the Board is appended as Annexure V to this report. Weaffirm that the Remuneration paid to the director is as per the terms laid out in the saidpolicy.

(D) Declaration by Independent Directors

The Company has received necessary declarations from all the Independent Directorsunder Section 149(7) of the Companies Act 2013 that they meet the criteria ofindependence laid down in Section 149(6) of the Companies Act 2013 notification issued bythe Ministry of Corporate affairs and SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and the Board is satisfied that the Independent Directorsmeet the criteria of Independence as stipulated under statutory laws.

The Declaration by Independent Director is annexed as Annexure I Annexure II &Annexure III to this Report.

BOARD COMMITTEES:

Currently the Board has three Committees: the Audit Committee the Nomination and

Remuneration Committee and the Stakeholder's Relationship Committee. All

Committees are appropriately constituted.

(i) The details of the composition of the Committees as on the date of this Report ismentioned below:

Name of the Committee Name of the Member Position Held
Mr.Jayaraman Chairman-Independent Director
Audit Mrs.ShamaPrasannaTiparaju Member- Independent Director
Committee Mr.Sudhakar P Member- Independent Director
Name of the Committee Name of the Member Position Held
Mr.Jayaraman Chairman-Independent Director
Nomination & Remuneration Mrs.ShamaPrasannaTiparaju Member- Independent Director
Committee Mr.Sudhakar P Member- Independent Director
Name of the Committee Name of the Member Position Held
Mrs.ShamaPrasannaTiparaju Chairman-Independent Director
Stakeholders Relationship Mr. NiranjanVyakarna Rao Member- Wholetime Director
Committee Mr.Sudhakar P Member- Independent Director

(ii) Meetings of Audit Committee and Attendance during the Year:

During the financial year under review Audit Committee Meetings were held on28-05-201914-08-2019 14-11-2019 and 20-01-2020.The attendance of the members at theAudit Committee meetings were as follows:

Attendance particulars

Name of the Member Meeting Held during their tenure Meeting Attended during their tenure
Mr.Jayaraman(Chairman) 4 4
Mr. P Sudhakar (Member) 4 3
Mrs.ShamaPrasanaTiparaju(Member) 4 4

(iii) Meetings of Nomination and Remuneration Committee and Attendance during the Year:

During the financial year under review Nomination and Remuneration Committee Meetingswere held on 20-01-2020.The attendance of the members at the Nomination and RemunerationCommittee meeting was as follows:

Attendance particulars

Name of the Member Meeting Held during their tenure Meeting Attended during their tenure
Mr.Jayaraman 1 1
Mrs.ShamaPrasannaTiparaju 1 1
Mr.P Sudhakar 1 1

(iv) Meetings of stakeholder relationship committee and attendance during the year:

During the financial year under review Stakeholder Relationship Committee Meetingswere held on 08-04-2019 14-08-2019 14-11-2019 and 20-01-2020 and the attendance of themembers at the Stakeholder Relationship Committee meeting was as follows:

Attendance particulars

Name of the Member Meeting Held during their tenure Meeting Attended during their tenure
Mrs.ShamaPrasannaTiparaju 4 4
Mr. Niranjan Vyakarna Rao 4 4
Mr.Sudhakar P 4 4

(v) Separate Meetings of Independent Directors:

During the year separate meetings of independent directors were held on January 202020 in which all independent directors were present. In these meetings they havediscussed and evaluated:

(i) performance of Non-Independent Directors Independent Directors and the Board ofDirectors as a whole.

(ii) performance of the Chairman of the Company considering the views of the Executiveand Non-Executive Directors.

(iii) performance of the various committees of the Board.

(iv) Evaluation of the quality content and timeliness of flow of information betweenthe Management and the Board that is necessary for the Board to effectively and reasonablyperform its duties.

CORPORATE SOCIAL RESPONSIBILITY

As per the provision of Section 135 of the Companies Act 2013 all companies having anet worth of Rs.500 crore or more or a turnover of Rs.1000 crore or more or a net profitof Rs.5 crore or more during the immediately preceding financial year are required toconstitute a CSR committee.

Your Company do not fall in the criteria to constitute a CSR Committee as per theprovisions of Section 135 of the Companies Act 2013.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013

Your Company gives utmost importance towards maintain and upholding the dignity of eachand every woman working in the Company. The Company has a policy on prevention of sexualHarassment at workplace which provides for adequate safeguards and protection for womenemployees working in the organization.

No Complaints were received in this regard during the year 2019- 20.

VIGIL MECHANISM

The Company has established a vigil mechanism to provide adequate safeguards againstvictimization and to provide direct access to the Chairman of the Audit Committee inappropriate cases. This mechanism is available on the website of the Company.

SECRETARIAL AUDIT

Pursuant to provisions of section 204 of the Companies Act 2013 read with Rule 9 ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 yourCompany has engaged the services of Mr.S.Vasudevan Company Secretaries in practiceChennai to conduct the Secretarial Audit of the Company for the period ended on 31stMarch 2020. The Secretarial Audit Report (in Form MR-3) is annexed as Annexure-VII tothis Report.

SECRETARIAL AUDITORSf OBSERVATIONS IN SECRETARIAL AUDIT REPORT

There is no qualification reservation or adverse remarks or disclaimer made by theSecretarial Auditor in their report and do not call for any further explanation/commentfrom the board.

AUDITORS

M/s.Kalyanasundaram & Associates Chartered Accountants Chennai was appointed asStatutory Auditors of the Company in the previous AGM held on 27th September2019.The term of the present Auditor will conclude at the ensuing Annual General meetingof the Company and being eligible has offered themselves for re-appointment.

Consent has been received from the Present auditors for their re-appointment to theeffect that they are not disqualified to be appointed as Statutory Auditors of the Companyin terms of the Companies Act 2013 & the rules made there under. The Members arerequested to consider and approve their appointment as Statutory Auditors for theFinancial year 2020-21.

STATUTORY AUDITORSf OBSERVATIONS IN AUDIT REPORT

There are no qualifications reservations or adverse remarks made by M/s.Kalyanasundaram & Associates. Chartered Accountants the Statutory Auditors of theCompany in their report. The observations made by the Statutory Auditors in their reportfor the financial period ended 31st March 2020 read with the explanatory notes thereinare self-explanatory and therefore do not call for any further explanation or commentsfrom the Board under Section 134(3) of the Companies Act 2013.

PARTICULARS ON CONSERVATION OF ENERGY RESEARCH AND DEVELOPMENT TECHNOLOGY ABSORPTIONAND FOREIGN EXCHANGE EARNINGS AND OUTGO

(i) Energy Conservation: Conservation of energy continues to receive increased emphasisand steps are being taken to reduce the consumption of energy at all levels. The Companyhas taken steps to conserve energy in its office use consequent to which energyconsumption had been minimized. No additional Proposals/ Investments were made to conserveenergy. Since the Company has not carried on industrial activities disclosures regardingimpact of measures on cost of production of goods total energy consumption etc are notapplicable.

(ii) Foreign Exchange Earnings and Outgo: The Company has not earned or spent anyforeign exchange during the year under review.

(iii) Research and Development & Technology Absorption: The Company has not adoptedany technology for its business and hence no reporting is required to be furnished underthis heading. The Company will adopt necessary technology as and when required in thefurtherance of the business.

DIRECTORSf RESPONSIBILITY STATEMENT

The Directors confirm that:-

(a) in the preparation of the annual accounts the applicable accountingstandards have been followed and that no material departures have been made from the same;

(b) they 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 and loss of the company for that period;

(c) they 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) they have prepared the annual accounts on a going concern basis;

And

(e) they have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.

 

Explanation. For the purposes of this clause the term "internal financialcontrols" means the policies and procedures adopted by the company for ensuring theorderly and efficient conduct of its business including adherence to company's policiesthe safeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information;

(f) they have devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

DETAILS IN RESPECT OF FRAUD REPORTED BY THE AUDITORS

There were no instances of fraud reported by the Auditors.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

During the year under review there are no transactions covered under the Provisions ofSection 186 of the Companies Act 2013.

RISK MANAGEMENT

The Company has developed and implemented a risk management policy includingidentification therein of elements of risk if any which in the opinion of the Board maythreaten the existence of the Company. The Board and the Audit Committee periodicallyundertake a review of the major risks affecting the Company's business and suggests stepsto be taken to control and mitigate the same.

EXTRACT OF ANNUAL RETURN

The details forming part of extract of Annual Return as on the financial year endedMarch 31 2019 pursuant to Section 92 (3) of the Companies Act 2013 in form MGT-9 aregiven in Annexure VIII forming part of this Report and is also available at thewebsite of the Company at www.rithwik.co.in

RELATED PARTY TRANSACTIONS

There were no any materially significant related parties' transaction with promotersand directors which were in conflict with the interest of the Company attracting theprovision of Section 188 of the Companies Act 2013 during the financial year.

Thus disclosure in Form AOC-2 is not required.

However Form AOC 2 related with particulars of contract or arrangements with relatedparties are annexed herewith as Annexure IX.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURT

There are no significant and material orders passed by the Regulators or Court thatwould impact the going concern status of the company.

INTERNAL FINANCIAL CONTROLS

The Company has a well-placed proper and adequate internal control system whichensures that all assets are safeguarded and protected and that the transactions areauthorized recorded and reported correctly. The Internal Financial Controls withreference to financial statements as designed and implemented by the Company are adequate.

During the year under review no material or serious observation has been received fromthe Internal Auditors of the Company for inefficiency or inadequacy of such controls. TheBoard of Directors has appointed M/s.V Suresh & Associates Chartered Accountants asthe Internal Auditor of the Company. The Internal Auditors independently evaluate theadequacy of internal controls and concurrently audit the majority of the transactions invalue terms.

MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY

1. Impact of COVID-19 on the business:-

Our business is not considered an 'Essential Services' as per the Ministry of HomeAffairs (MHA). At RFMS during the first phase of lockdown due to COVID-19 the curfew wasimposed and all operations were completely stopped we experienced constraints intransportation availability of labour movement of maintenance staff to upkeep thefacilities running (HVAC DG etc) logistics etc. Thereafter the Government of Indiaallowed "Private security services and facilities management services formaintenance and upkeep of office and residential complexes" via serial number14(iii) as per Minister of Home affairs dated 15th April 2020. We managed to overcomesome of the obstacles and were able to streamline the process to certain extent.

2. Ability to maintain operations:-

The Company has taken conscious decision through balance uninterrupted operations andensuring a safe working environment. To ensure this 30 % of the staff during second phaseof lockdown and thereafter 50% of the staff have been asked to report to work at theirlocations. The Company has also made necessary arrangements to ensure that they are safeand comfortable at work.

3. Steps taken to ensure smooth functioning:-

The Company has put in place strict standard operating procedures for COVID-19 ensuringthe following:-

? Thermal Screening of / Aarogya Setu App.

? Sanitizers with foot operated machines placed at strategic locations

In addition to above the Company have implemented the Standard Operating Procedureswhich is strictly being followed across all the Units and Workplaces and we have alsodesignated officials responsible for ensuring the compliances to the Guidelines Rules andRegulations issued by Central as well as State Government on COVID-19 from time to time:

The Company has been regularly conducting awareness programs for all its Employees.

All Customers and Vendors of the Company have been communicated about the measurestaken by the Company through mails.

4. Estimation of the future impact of COVID-1 9 on operations:-

As explained above there has not been any material adverse impact on the Company'sperformance for the financial year 2019-20.We expect fall in revenue of about 10 to 15%for the financial year 2020-21.

5. Details of impact of COVID-19 based on certain performance parameters:

? Capital and financial resources and other assets - As per the current assessmentthere is no significant impact on the Company's capital and financial resources and otherassets of the Company.

? Profitability-We expect a reduction in profits by 10 to 15% for the financial year2020-21.

? Liquidity - The Company has a strong balance sheet and liquidity position.

? Ability to service debt - The Company has adequate financial resources to meet itsworking capital requirement. The Company has never in the past defaulted on any interestor loan payment and does not see any issue meeting future obligations too.

? Assets - None of the assets of the Company have been impacted or impaired by theCOVID-19.

? Internal Financial Controls -The Company has system in place at office locations arewell networked. Accordingly all Internal Financial Controls and reporting systems areworking seamlessly without disruption.

? Supply Chain - There has been no impact because we have sufficient labour force.

? Demand - The commercial real estate industry is likely to see fall in occupy ofaround 15 to20 %.Our Business is directly related to the IT/IIE3/Commercial leasing as aresult we expect a reduction in demand.

6. Impact on Contracts/ Agreements:-

The Company expects to see a 10 to 15% reduction in respect of its existing Contractsand Agreements. This is due to two factors. One is as stated above with respect to demand.The other being that we are unable to put into effect our annual escalation which was duein April 2020 as per the contracts.

7. Other relevant material updates: - None

LISTING

Your Company is listed on SME platform of BSE Ltd. from 11th January 2018. TheCompany's code is RITHWIKFMS (540843) and ISIN is INE819Y01015.The following tabledepicts the price movement for the year 2019-20.

DEPOSITS

Your Company has not accepted any public deposits during the year under review.

ACKNOWLEDGEMENTS

Your Directors place on record their sincere appreciation for significant contributionmade by employees of the Company at each level through their dedication hard work andcommitment.

The Board places on record its appreciation for the continued co-operation and supportextended to the Company by various stakeholders Banks Stock Exchanges NSDL and CDSL.The Board wishes to express its grateful appreciation for the assistance and co-operationreceived from Vendors Customers Consultants Banks Financial Institutions and otherBusiness Associates. The Board deeply acknowledges the trust and confidence placed by thecustomers of the Company and above all the shareholders.

For and on behalf of the Board of Directors
Rithwik Facility Management Services Limited
Sd/- Sd/-
Rithwik Rajshekar Raman Niranjan Vyakarna Rao
Managing Director Whole Time Director
DIN: 07836658 DIN: 02918882

Place: Chennai

Date : 21/08/2020

 

DECLARATION OF INDEPENDENCE

Date: 13.07.2020

To

The Board of Directors

Rithwik Facility Management Services Limited R R Tower III Thiru-Vi-Ka IndustrialEstate Guindy Chennai-600 032

Subject: Declaration of independence under sub-section (6) of section 149 of theCompanies Act 2013 and the Regulation 16 of SEBI (LODR) Regulation 2015

I JAYARAMAN (DIN: 08112010) hereby certify that I am a Non-ExecutiveIndependent Director of Rithwik Facility Management Services Limited having itregistered office at R R Tower III Thiru-Vi-Ka Industrial Estate Guindy Chennai-600 032and comply with all the criteria of independent director as envisaged in the SEBI (ListingObligation and Disclosure Requirements) Regulation 2015 and the Companies Act 2013.

I certify that:

1. I possess relevant expertise and experience to be an independent director in thecompany;

2. I am/was not a promoter of the company or its holding subsidiary or associatecompany;

3. I am not related to promoters or directors in the company its holding subsidiaryor associate company;

4. I have/had no pecuniary relationship other than remuneration as such director orhaving transaction not exceeding ten percent of my total income or such amount as may beprescribed with the company its holding subsidiary or associate company or theirpromoters or directors during the two immediately preceding financial years or duringthe current financial year;

5. None of my relatives

(i) is holding any security of or interest in the company its holding subsidiary orassociate company during the two immediately preceding financial years or during thecurrent financial year.

(ii) is indebted to the company its holding subsidiary or associate company or theirpromoters or directors in excess of 50 lacs rupees at any time during the twoimmediately preceding financial years or during the current financial year;

(iii) has given a guarantee or provided any security in connection with theindebtedness of any third person to the company its holding subsidiary or associatecompany or their promoters or directors of such holding company in excess of 50 lacsrupees at any time during the two immediately preceding financial years or during thecurrent financial year; or

(iv) has any other pecuniary transaction or relationship with the company or itssubsidiary or its holding or associate company amounting to two per cent. or more of itsgross turnover or total income singly or in combination with the transactions referred toin Point (i) (ii) or (iii);

6. Neither me nor any of my relatives:

(i) holds or has held the position of a key managerial personnel or is or has beenemployee of the company or its holding subsidiary or associate company in any of thethree financial years immediately preceding the financial year;

(ii) is or has been an employee or proprietor or a partner in any of the threefinancial years immediately preceding the financial year of;

(A) a firm of auditors or company secretaries in practice or cost auditors of thecompany or its holding subsidiary or associate company; or

(B) any legal or a consulting firm that has or had any transaction with the companyits holding subsidiary or associate company amounting to 10% or more of the grossturnover of such firm;

(iii) holds together with my relatives 2% or more of the total voting power of thecompany; or

(iv) is a Chief Executive or director by whatever name called of any nonprofitorganization that receives 25%or more of its receipts from the company any of itspromoters directors or its holding subsidiary or associate company or that holds 2% ormore of the total voting power of the company; or

7. I am not a material supplier service provider or customer or a lessor or lessee ofthe company;

8. I am not a non-independent director of another company on the board of which any nonindependent director of the listed entity is an independent director:

9. I am not less than 21 years of age.

I do hereby declare that I am not disqualified to act as the Director under any of thecircumstances stipulated under Section 164 of the Companies Act 2013 and that I atpresent stand free from any disqualification from being a director under other provisionsof Section 164 of the Companies Act 2013.

DECLARATION

I undertake that I shall seek prior approval of the Board if and when I have any suchrelationship/ transactions whether material or non-material. If I fail to do so I shallcease to be an independent director from the date of entering in to such relationship /transactions.

Further I do hereby declare and confirm that the above said information's are true andcorrect to the best of my knowledge as on the date of this declaration of independence andI shall take responsibility for its correctness and shall be liable for fine if anyimposed on the Company its directors if the same found wrong or incorrect in future.

I further undertake to intimate immediately upon changes if any to the Company forupdating of the same.

Thanking you

Yours faithfully

Sd/-

JAYARAMAN

Non-Executive & Independent Director DIN: 08112010

ANNEXURE II

DECLARATION OF INDEPENDENCE

Date: 13.07.2020

To

The Board of Directors

Rithwik Facility Management Services Limited R R Tower III Thiru-Vi-Ka IndustrialEstate Guindy Chennai-600 032

Subject: Declaration of independence under sub-section (6) of section 149 of theCompanies Act 2013 and the Regulation 16 of SEBI (LODR) Regulation 2015

I P SUDHAKAR (DIN: 02483116) hereby certify that I am a Non-ExecutiveIndependent Director of Rithwik Facility Management Services Limited having itregistered office at R R Tower III Thiru-Vi-Ka Industrial Estate Guindy Chennai-600 032and comply with all the criteria of independent director as envisaged in the SEBI (ListingObligation and Disclosure Requirements) Regulation 2015 and the Companies Act 2013.

I certify that:

1. I possess relevant expertise and experience to be an independent director in thecompany;

2. I am/was not a promoter of the company or its holding subsidiary or associatecompany;

3. I am not related to promoters or directors in the company its holding subsidiaryor associate company;

4. I have/had no pecuniary relationship other than remuneration as such director orhaving transaction not exceeding ten percent of my total income or such amount as may beprescribed with the company its holding subsidiary or associate company or theirpromoters or directors during the two immediately preceding financial years or duringthe current financial year;

5. None of my relatives

(i) is holding any security of or interest in the company its holding subsidiary orassociate company during the two immediately preceding financial years or during thecurrent financial year.

(ii) is indebted to the company its holding subsidiary or associate company or theirpromoters or directors in excess of 50 lacs rupees at any time during the twoimmediately preceding financial years or during the current financial year;

(iii) has given a guarantee or provided any security in connection with theindebtedness of any third person to the company its holding subsidiary or associatecompany or their promoters or directors of such holding company in excess of 50 lacsrupees at any time during the two immediately preceding financial years or during thecurrent financial year; or

(iv) has any other pecuniary transaction or relationship with the company or itssubsidiary or its holding or associate company amounting to two per cent. or more of itsgross turnover or total income singly or in combination with the transactions referred toin Point (i) (ii) or (iii);

6. Neither me nor any of my relatives:

(i) holds or has held the position of a key managerial personnel or is or has beenemployee of the company or its holding subsidiary or associate company in any of thethree financial years immediately preceding the financial year;

(ii) is or has been an employee or proprietor or a partner in any of the threefinancial years immediately preceding the financial year of;

(A) a firm of auditors or company secretaries in practice or cost auditors of thecompany or its holding subsidiary or associate company; or

(B) any legal or a consulting firm that has or had any transaction with the companyits holding subsidiary or associate company amounting to 10% or more of the grossturnover of such firm;

(iii) holds together with my relatives 2% or more of the total voting power of thecompany; or

(iv) is a Chief Executive or director by whatever name called of any nonprofitorganization that receives 25%or more of its receipts from the company any of itspromoters directors or its holding subsidiary or associate company or that holds 2% ormore of the total voting power of the company; or

7. I am not a material supplier service provider or customer or a lessor or lessee ofthe company;

8. I am not a non-independent director of another company on the board of which any nonindependent director of the listed entity is an independent director:

9. I am not less than 21 years of age.

I do hereby declare that I am not disqualified to act as the Director under any of thecircumstances stipulated under Section 164 of the Companies Act 2013 and that I atpresent stand free from any disqualification from being a director under other provisionsof Section 164 of the Companies Act 2013.

Declaration

I undertake that I shall seek prior approval of the Board if and when I have any suchrelationship/ transactions whether material or non-material. If I fail to do so I shallcease to be an independent director from the date of entering in to such relationship /transactions.

Further I do hereby declare and confirm that the above said information's are true andcorrect to the best of my knowledge as on the date of this declaration of independence andI shall take responsibility for its correctness and shall be liable for fine if anyimposed on the Company its directors if the same found wrong or incorrect in future.

I further undertake to intimate immediately upon changes if any to the Company forupdating of the same.

Thanking you

Yours faithfully

Sd/-

P SUDHAKAR

Non-Executive & Independent Director DIN: 02483116

 

ANNEXURE III

DECLARATION OF INDEPENDENCE

Date: 13.07.2020

To

The Board of Directors

Rithwik Facility Management Services Limited R R Tower III Thiru-Vi-Ka IndustrialEstate Guindy Chennai-600 032

Subject: Declaration of independence under sub-section (6) of section 149 of theCompanies Act 2013 and the Regulation 16 of SEBI (LODR) Regulation 2015

I SHAMA PRASANNA TIPPARAJU (DIN: 07922496) hereby certify that I am aNon-Executive Independent Director of Rithwik Facility Management Services Limitedhaving it registered office at R R Tower III Thiru-Vi-Ka Industrial Estate GuindyChennai-600 032 and comply with all the criteria of independent director as envisaged inthe SEBI (Listing Obligation and Disclosure Requirements) Regulation 2015 and theCompanies Act 2013.

I certify that:

1. I possess relevant expertise and experience to be an independent director in thecompany;

2. I am/was not a promoter of the company or its holding subsidiary or associatecompany;

3. I am not related to promoters or directors in the company its holding subsidiaryor associate company ;

4. I have/had no pecuniary relationship other than remuneration as such director orhaving transaction not exceeding ten percent of my total income or such amount as may beprescribed with the company its holding subsidiary or associate company or theirpromoters or directors during the two immediately preceding financial years or duringthe current financial year;

5. None of my relatives

(i) is holding any security of or interest in the company its holding subsidiary orassociate company during the two immediately preceding financial years or during thecurrent financial year.

(ii) is indebted to the company its holding subsidiary or associate company or theirpromoters or directors in excess of 50 lacs rupees at any time during the twoimmediately preceding financial years or during the current financial year;

(iii) has given a guarantee or provided any security in connection with theindebtedness of any third person to the company its holding subsidiary or associatecompany or their promoters or directors of such holding company in excess of 50 lacsrupees at any time during the two immediately preceding financial years or during thecurrent financial year; or

(iv) has any other pecuniary transaction or relationship with the company or itssubsidiary or its holding or associate company amounting to two per cent. or more of itsgross turnover or total income singly or in combination with the transactions referred toin Point (i) (ii) or (iii);

6. Neither me nor any of my relatives:

(i) holds or has held the position of a key managerial personnel or is or has beenemployee of the company or its holding subsidiary or associate company in any of thethree financial years immediately preceding the financial year;

(ii) is or has been an employee or proprietor or a partner in any of the threefinancial years immediately preceding the financial year of;

(A) a firm of auditors or company secretaries in practice or cost auditors of thecompany or its holding subsidiary or associate company; or

(B) any legal or a consulting firm that has or had any transaction with the companyits holding subsidiary or associate company amounting to 10% or more of the grossturnover of such firm;

(iii) holds together with my relatives 2% or more of the total voting power of thecompany; or

(iv) is a Chief Executive or director by whatever name called of any nonprofitorganization that receives 25%or more of its receipts from the company any of itspromoters directors or its holding subsidiary or associate company or that holds 2% ormore of the total voting power of the company; or

7. I am not a material supplier service provider or customer or a lessor or lessee ofthe company;

8. I am not a non-independent director of another company on the board of which any nonindependent director of the listed entity is an independent director:

9. I am not less than 21 years of age.

I do hereby declare that I am not disqualified to act as the Director under any of thecircumstances stipulated under Section 164 of the Companies Act 2013 and that I atpresent stand free from any disqualification from being a director under other provisionsof Section 164 of the Companies Act 2013.

Declaration

I undertake that I shall seek prior approval of the Board if and when I have any suchrelationship/ transactions whether material or non-material. If I fail to do so I shallcease to be an independent director from the date of entering in to such relationship /transactions.

Further I do hereby declare and confirm that the above said information's are true andcorrect to the best of my knowledge as on the date of this declaration of independence andI shall take responsibility for its correctness and shall be liable for fine if anyimposed on the Company its directors if the same found wrong or incorrect in future.

I further undertake to intimate immediately upon changes if any to the Company forupdating of the same.

Thanking you

Yours faithfully

Sd/-

SHAMA PRASANNA TIPPARAJU

Non-Executive & Independent Director

DIN: 07922496

.