The Board of Directors of your Company take pleasure in presenting before you the 23rdAnnual Report of the Company together with the Audited Financial Statements for thefinancial year ended March 312018.
FINANCIAL SUMMARY/HIGHLIGHTS OPERATIONS & STATE OF AFFAIRS:
| || ||(Rs. In Lakhs) |
|Particulars ||2017-18 ||2016-17 |
|Gross Income ||318.68 ||263.91 |
|Less: Finance Cost ||113.46 ||100.46 |
|Overheads ||131.77 ||97.58 |
|Depreciation ||8.18 ||11.86 |
|Profit before Tax & Exceptional Items ||65.27 ||54.01 |
|Add : Exceptional Items ||0.00 ||0.00 |
|Profit Before Tax ||65.27 ||54.01 |
|Less : Provision for Taxation (Including Deferred Tax) ||15.94 ||16.13 |
|Profit After Tax ||49.33 ||37.88 |
|Add : Balance b/d from the previous year ||83.06 ||54.60 |
|Surplus available for Appropriations ||132.39 ||92.48 |
|Appropriations: || || |
|Transferred to Special Reserve ||9.90 ||7.58 |
|Provision for Standard Assets ||0.72 ||0.53 |
|Provision for NPA ||14.93 ||1.25 |
|Excess Provision for Income Tax ||0.61 ||0.06 |
|Balance carried over to Balance Sheet ||106.23 ||83.06 |
LENDING OPERATIONS & DISBURSEMENT OF LOANS:
Your Company registered a remarkable growth in its operations. The highlights ofCompany's Performance are as follows:
The Operating Profit before charging depreciation and tax amounted to Rs. 73.45Lakhs in the year 2017-18 as against Rs. 65.87 Lakhs in the preceding year; representing arise of 11.51%.
Profit after Tax (PAT) before extraordinary items went up by 30.25% to Rs. 49.34Lakhs in the year 2017-18 from Rs. 37.88 Lakhs in the previous year.
As at 31st March 2018 the loan portfolio stood at Rs. 1790.28 Lakhsas against Rs. 1353.25 Lakhs in the previous year representing an increase of 32.30%.
Disbursements during the year amounted to Rs. 1064.08 Lakhs as against Rs.378.42 Lakhs in previous year representing a growth of 181.19%.
As a part of its liability management your Company endeavors to diversify itsresource base in order to achieve an appropriate maturity structure and minimize theweighted average cost of borrowed funds.
Your Directors felt it prudent to retain the earnings for the year under review to beploughed back in business which shall result in further augmentation of the Company'sgrowth and Shareholders' wealth.
CHANGES IN SHARE CAPITAL:
During the year under review the Authorized Share Capital of the Company was increasedfrom Rs. 5.00 Crores to Rs. 12.00 Crores. The Paid up Equity Share Capital of the Companywas increased from Rs. 3.87 Crores to Rs. 5.37 Crores as a result of allotment of1500000 equity shares of face value of Rs. 10 each at an issue price of Rs. 25/- pershare (including premium of Rs. 15/- per share) by way of Private Placement to thepromoter and non-promoter category.
As at March 31st 2018 the Paid up Equity Share Capital of the Company stoodat Rs. 53754000 divided into 5375400 equity shares of Rs. 10 each.
Banks and Financial Institutions:
The Company did not avail fresh credit facilities during the year 2017-18. Theoutstanding credit facilities from Banks and Financial Institutions as at March 31 2018amounts to Rs.1175.25 Lakhs.
The Bank loan facilities of the Company have been rated by Brickwork Ratings theCredit Rating agency as BWR BB Outlook: Stable and by CARE Ratings as CARE BB; OutlookStable.
UNCLAIMED DIVIDEND AND UNCLAIMED SHARES:
Under the provisions of Section 124 and 125 of The Companies Act 2013 and Rules framedthereunder and Investor Education and Protection Fund Authority (Accounting AuditTransfer and Refund) Rules 2016 read with the relevant circulars and amendments theretodividends that remain unclaimed for a period of seven years from the date of declarationare required to be transferred to the Investor Education and Protection Fund (IEPF)administered by the Central Government.
Further as per the provisions of Section 124(6) of The Companies Act 2013 read withthe Investor Education & Protection Fund Authority (Accounting Audit Transfer &Refund) Rules 2016 the shares in respect of which the dividend has not been claimed forseven (7) consecutive years are required to be transferred by the Company to thedesignated Demat account of the IEPF Authority.
As at March 31 2018 there is no unpaid/ unclaimed Dividend and the shares to betransferred to the Investor Education & Protection Fund.
MANAGEMENT DISCUSSION AND ANALYSIS:
Pursuant to SEBI (LODR) Regulations 2015 and Circular/ Notifications/Directionsissued by RBI from time to time Report on Management Discussion and Analysis is annexedherewith as Annexure III.
The Company does not have any subsidiary.
DIRECTOR'S RESPONSIBILITY STATEMENT:
In pursuance of Section 134 (3) (c) of The Companies Act 2013 and based on theinformation provided by the management your Directors hereby confirm that:
a. In the preparation of the annual accounts the applicable accounting standards havebeen followed;
b. Accounting policies selected were applied consistently. Reasonable and prudentjudgments and estimates were made so as to give a true and fair view of the state ofaffairs of the Company as at March 31 2018 and of the profit of the Company for the yearended on that date;
c. Proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of The Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting frauds and other irregularities;
d. The annual accounts of the Company have been prepared on a going concern basis;
e. Internal Financial Controls have been laid down to be followed by the Company andsuch Internal Financial Controls were adequate and were operating effectively;
f. Systems to ensure compliance with the provisions of all applicable laws were inplace and were adequate and operating effectively.
CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION:
Your Company has taken adequate steps to adhere to all the stipulations laid down inthe SEBI (LODR) Regulations 2015 RBI Directions and the Companies Act 2013 and Rulesthereto as amended from time to time.
Pursuant to the SEBI (LODR) Regulations 2015 RBI Directions and disclosures asrequired under The Companies Act 2013 and the Rules thereto a separate Section titledReport on Corporate Governance' forms part of this Annual Report as Annexure V.
Certificate from the Statutory Auditors of the Company confirming the compliance withthe conditions of Corporate Governance as stipulated under SEBI (LODR) Regulations 2015is attached to this report.
The said certificate for the financial year 2017-18 does not contain any qualificationreservation or adverse remarks.
In terms of Section 136 of The Companies Act 2013 the reports and accounts are beingsent to the members and others entitled thereto.
RELATED PARTY TRANSACTIONS:
All contracts/arrangements/transactions entered by the Company with related parties arein the ordinary course of business and on an arm's length basis. Your Directors drawattention of the Members to Note no. 21 to the Financial Statements which sets out relatedparty disclosures.
During the year the Company had not entered into any contract/arrangement/transactionwith related parties which could be considered material in accordance with the policy ofthe Company on materiality of related party transactions accordingly information is notgiven in Form AOC-2.
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 at the link
RISK MANAGEMENT POLICY:
Pursuant to Section 134 (3) (n) of The Companies Act 2013 & SEBI (LODR)Regulations 2015 the Company has in place a risk management framework approved by theBoard of Directors.
SRGSFL's Risk Management framework provides the mechanism for risk assessment andmitigation. Company has in place Risk Management Committee. The details of the Committeeand its terms of reference are set out in the Corporate Governance report forming part ofthe Boards report.
At present the Company has not identified any element of risk which may threaten theexistence of the Company.
CORPORATE SOCIAL RESPONSIBILTY POLICY:
Pursuant to the provisions of Section 135 and Schedule VII of The Companies Act 2013at present the CSR provisions are not applicable to the Company.
DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS:
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit function isdefined by board. To maintain its objectivity and independence the Internal Auditorreports to the Chairman of the Audit Committee of the Board and/or to the ManagingDirector.
The Internal Auditor monitors and evaluates the efficacy and adequacy of internalcontrol system in the Company its compliance with operating systems accountingprocedures and policies of the Company.
Based on the report of internal auditor respective heads undertake corrective actionsin their respective areas and thereby strengthen the controls. Significant auditobservations and recommendations along with corrective actions thereon are presented tothe Audit Committee of the Board and/or to the Managing Director.
During the year Mr. Bhupesh Kumar Jain resigned from the post of Independent Directorof the Company due to some prior commitments. Board of Directors in their meeting held onMay 13 2017 accepted the resignation with effect from May 13 2017.
Further during the year Mr. Rajesh Jain resigned from the post of Non-ExecutiveDirector of the Company due to personal reason. Board of Directors in their meeting heldon November 21 2017 accepted the resignation with effect from November 212017.
Since the present Directors of the Company includes Mr. Vinod Kumar Jain ManagingDirector Mrs. Seema Jain Whole Time Director and two Independent Directors i.e. Mr.Arjun Lal Jain and Mr. Nishant Badala all being not liable to retire by rotation pursuantto provisions of Companies Act 2013 and pursuant to the terms of their appointment/re-appointment your Board of Directors is taking adequate steps to appoint such numberof Directors to comply with the provisions of Companies Act 2013 and Articles ofAssociation of the Company regarding retire by rotation of Directors.
All the directors of the Company have confirmed that they are not disqualified frombeing appointed as directors in terms of Section 164 of the Companies Act 2013 and allthe Directors have filed their consents and declarations as required under the provisionsof Companies Act 2013 SEBI (LODR) Regulations 2015.
During the year under review Board of Directors of the Company in their meeting heldon 1st May 2017 accepted resignation of Mrs. Aarti Jain from the post of ChiefFinancial Officer and appointed Mr. Kartik Singh Mehta as the Chief Financial Officer ofthe Company with effect from 28th October 2017.
DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS:
The Company has received necessary declaration from each Independent Director of theCompany under Section 149(7) of The Companies Act 2013 that the Independent Directors ofthe Company meet with the criteria of their Independence as laid down in Section 149(6).
Pursuant to the provisions of Section 139 142 and all other applicable provisions ofThe Companies Act 2013 and Rules made thereunder at the 22ndAnnual GeneralMeeting held on September 30 2017 the members had appointed M/s. PKJ & Co. CharteredAccountants (Registration No. 124115W) as the statutory Auditor of the Company for theperiod of five years upto the conclusion of 27thAnnual General Meeting to beheld in year 2022 subject to ratifying the said appointment at every AGM.
MCA vide its notification dated 7th May 2018 has brought into effectcertain provisions of The Companies (Amendment) Act 2017 thereby amending provisions ofthe Companies Act 2013 including Section 139 of the Act whereby the requirement ofratification of appointment of statutory auditors at every subsequent AGM has been doneaway with.
In view of the above M/s. PKJ & Co. Chartered Accountants (Registration No.124115W) appointed by the members at the 22ndAnnual General Meeting held onSeptember 30 2017 as the statutory Auditor of the Company for the period of five yearsupto the conclusion of 27thAnnual General Meeting to be held in year 2022willcontinue as the Statutory Auditors of the Company without ratifying the appointment atevery annual general meetingon such terms and conditions as may be decided by Board.
M/s Deepak Vijaywargey & Associates Practicing Company Secretary Udaipur wasappointed as the Secretarial Auditor of the Company for the financial year 2017-18 by theBoard of Directors pursuant to provisions of The Companies Act 2013 and Rules thereunder. Secretarial audit report as provided by M/s Deepak Vijaywargey & AssociatesPracticing Company Secretary is annexed to this Report as ANNEXURE I.
QUALIFICATIONS IN AUDIT REPORT:
There are no qualifications reservations or adverse remarks or disclaimer made:
(a) By the Statutory Auditor in his report; and
(b) By the Company Secretary in Practice in his Secretarial Audit Report.
The Board of Directors met 18 (Eighteen) times during the financial year 2017-18.
COMPOSITION OF AUDIT COMMITTEE:
The Audit Committee consists of adequate composition of Executive and Non- ExecutiveIndependent Directors. The details of which are mentioned in the Corporate GovernanceReport.
COMPOSITION OF NOMINATION & REMUNERATION COMMITTEE:
The Nomination & Remuneration Committee consists of composition of Non- ExecutiveIndependent Directors. The vacancy created due to resignation of Mr. Rajesh JainNon-Executive Director from the membership of the committee shall be filled by Board ofDirectors by appointment of another Non- Executive Director subject to approval ofshareholders on the Board as well as the committee. The details of which are mentioned inthe Corporate Governance Report.
COMPOSITION OF STAKEHOLDER'S RELATIONSHIP COMMITTEE:
The Stakeholder's Relationship Committee consists of adequate composition of Executiveand Non- Executive Independent Directors. The details of which are mentioned in theCorporate Governance Report.
PARTICULARS OF LOANS GAURANTEES OR INVESTMENTS:
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 if any apart from the loans made guarantee given orsecurity provided by the Company in the ordinary course of business are given in theNotes to accounts forming part of the Audited Financial Statements for the year endedMarch 312018.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE OUTGO:
(A) Conservation of energy:
The Company's operations are not power intensive. Nevertheless your Company is takingevery step to conserve and minimize the use of energy wherever possible such as usingenergy efficient computer terminals purchasing energy efficient equipments etc.
(B) Technology absorption:
The Company has imported no technology. Indigenous technology available is continuouslyupgraded to improve overall performance.
(C) Expenditure incurred on research and development:
The Company has no formal research and development department but the Company iscontinuously making efforts to strengthen research and development activities to improvequality and reduce cost.
(D) Foreign exchange earnings and Outgo:
During the year under review there was no earnings and outgo in foreign exchange.
EXTRACT OF ANNUAL RETURN:
As required pursuant to Section 92(3) of The Companies Act 2013 and Rule 12(1) of TheCompanies (Management and Administration) Rules 2014 the details forming part of extractof annual return in MGT-9 is annexed herewith as Annexure II.
PARTICULARS OF EMPLOYEES:
As at March 31 2018 there was no employee employed throughout the year who was inreceipt of remuneration of Rs. 1.02 Crores or more per annum or Rs. 8.50 Lakhs or more permonth if employed for the part of the year.
EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS:
There are no material changes and commitments affecting financial position of theCompany between March 312018 and the date of Board's Report.
CHANGE IN THE NATURE OF BUSINESS:
There are no changes in the Nature of Business.
DETAILS RELATING TO DEPOSITS:
Your Company has not accepted any deposits from the public during the year under review.The Company has been granted registration by the Reserve Bank of India as a non-deposittaking NBFC. Being so the Company has neither accepted in the past nor has any futureplans to accept any public deposits.
SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS:
The Company has been following directions guidelines circulars issued by SEBI BSEMCA RBI etc. from time to time relating to companies and that there are no significant& material orders passed by these regulators so far.
DISCLOSURES ON MANAGERIAL REMUNERATION:
Details of Managerial remuneration as required under Rule 5(1) of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 read with The Companies(Appointment and Remuneration of Managerial Personnel) Amendment Rules 2016 is given as"Annexure-VI" to this report.
LISTING WITH STOCK EXCHANGES:
The Company confirms that it has paid the Annual Listing Fees for the year 2017-18 toBSE SME where the Company's Shares are listed.
INVESTOR COMPLAINTS AND COMPLIANCE:
During the year company has not received any investor complaints and that as on date nocomplaints are pending.
EARNINGS PER SHARE (EPS):
The Earnings Per Share (EPS) is 1.23 as at March 31st 2018 as against 0.98as at March 31st 2017.
|Particulars as on 31st March ||2018 ||2017 |
|Capital Adequacy Ratio ||51.26% ||48.69% |
Your Company's capital adequacy ratio was 51.26% as on 31st March 2018which we believe provides an adequate cushion to withstand business risks.
NON-PERFORMING ASSETS AND PROVISIONS FOR CONTINGENCY:
Your Company adhered to the prudential guidelines for Non-performing Assets (NPAs)issued by Reserve Bank of India as amended from time to time. As per the prudentialnorms the income on such NPAs is not to be recognized if unrealized.
As per the prudential norms prescribed by the Reserve Bank of India the Company hasmade provision for contingencies on standard as well as non-performing assets.
A NOTE OF APPRECIATION:
Your Directors place on record their appreciation for the advice guidance and supportgiven by various regulatory authorities including the RBI SEBI MCA the Stock Exchange(BSE) Depositories and all the bankers of the Company including State Bank of India . TheDirectors would also like to acknowledge the role of all its stakeholders - shareholdersborrowers key partners and lenders for their continuing support to the Company. YourDirectors also record their appreciation for the dedicated services of the employees andtheir contribution to the growth of the Company. The Board would also like to express itssincere appreciation to all the Company's valued Shareholders RTA Service Providers andCounselors for their continued support and patronage.
|Best Wishes || |
|Sd/- ||Sd/- |
|Vinod K. Jain ||Seema Jain |
|Managing Director ||Director |
|DIN:00248843 ||DIN:00248706 |
|Date: - 28.05.2018 || |
|Place: - Udaipur || |