Your Directors are pleased to present 10th Annual Report of SecMarkConsultancy Limited (the Company') along with the audited financial statements forthe financial year ended March 31 2021. The Company along with its subsidiary whereverrequired is referred as we' us' our' or SecMark'. Theconsolidated performance of the Company and its subsidiary has been referred to whereverrequired.
The summary of financial performance of the Company for the year under review is asgiven below: Results of our operations and state of affairs
(Amt in Rs.)
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|Particulars || |
For the Year ended 31st March
For the Year ended 31st March
| ||2021 ||2020 ||2021 ||2020 |
|Revenue from Operation ||75890349 ||56256131 ||75890349 ||56256131 |
|Other Income ||5223540 ||1216780 ||5229540 ||1217780 |
|Operating Profit Before Interest Depreciation and Tax ||31455977 ||18197945 ||31456328 ||18198296 |
|Finance cost ||837872 ||831303 ||837872 ||831303 |
|Depreciation ||2204447 ||2093941 ||2204447 ||2093941 |
|Non-Operating Expenses (IPO Expenses) ||8430201 ||875000 ||8430201 ||875000 |
|Other Exceptional items ||- ||- ||- ||- |
|Profit Before Tax (PBT) ||19983458 ||14397700 ||19983809 ||14398051 |
|Tax Expenses ||4253837 ||3782423 ||4253917 ||3782503 |
|Profit After Tax (PAT) ||15729621 ||10615277 ||15729892 ||10615548 |
|Share in (loss)/profit of associates ||- ||- ||- ||- |
|Profit After Tax (Share in associates) ||15729621 ||10615277 ||15729892 ||10615548 |
|Operating PBT Ratio ||41.45% ||32.35% ||41.45% ||32.35% |
|PBT Ratio ||26.33% ||25.59% ||26.33% ||25.59% |
|PAT Ratio ||20.73% ||18.87% ||20.73% ||18.87% |
The key highlights pertaining to the business of the Company for the financial the yearended have been given hereunder.
The standalone operating revenue including other income of the Company for the yearunder review was Rs. 81113889/- as against Rs. 57472911/- in the previous year whichin the opinion of the Directors is satisfactory. Your Directors are hopeful to furtherimprove the growth rate in turnover and profitability in current year. Standalone netprofit after tax stood at Rs. 15729621/- as against Rs. 10615277/- in the previousyear.
The consolidated operating revenue including other income of the Company for the yearunder review was Rs. 81113889/- as against Rs. 57472911/- in the previous year whichin the opinion of the Directors is satisfactory. Consolidated net profit after tax stoodat Rs. 15729621/- as against Rs. 10615277/- in the previous year.
The financial performance is discussed in detail in the Management Discussion andAnalysis which is presented in a separate section forming part of the Director's Report.
CHANGE IN THE NATURE OF BUSINESS IF ANY:
During the year under review there is no change in nature of business of the Company.
As per the requirements of Section 92(3) of the Companies Act 2013 (hereinafterreferred as "the Act") and Rule 11 of the Companies (Management andAdministration) Rules 2014 framed thereunder including any statutorymodifications/amendments thereto for the time begin force the annual return for FinancialYear 2020-21 is available on its website www.secmark.com and is available through thewebsite https://www.secmark.in.
With a view to conserve reserves your Directors do not recommend any dividend for thefinancial year
The Company does not propose to transfer any amounts to the general reserve out of theamount available for appropriation. The total profit of Rs. 15729892 available with theCompany as on March 31 2021 on a consolidated basis is proposed to be retained in theprofit and loss account.
As at March 31 2021 the Issued Subscribed and Paid-up Equity Share Capital of theCompany stood at Rs. 41240000 (Rupees Four Crores Twelve Lakhs Forty Thousand Only)divided into 4124000 (Forty One Lakh Twenty Four Thousand Only) Equity Shares of Rs.10/- (Rupees Ten Only) each. During the year the Company has issued 1114000 equityshares of face value of Rs.10/- each by the way of Initial Public Offering (IPO).
LISTING OF SECURITIES AND ANNUAL LISTING FEES:
All the equity shares of the Company i.e. 4124000 equity shares got listed on SMEplatform of BSE Ltd. (BSE) on October 1 2020. The script code of the Company at BSE is543234 and ISIN INE0BTM01013. The Company has paid the Annual Listing Fees for the year2020-21 to the BSE Ltd where the Company's shares are listed.
BOARD OF DIRECTORS KEY MANAGERIAL PERSONNEL AND NUMBER OF MEETINGS OF BOARD OFDIRECTORS:
COMPOSITION OF BOARD OF DIRECTORS:
As on the date of this Director's Report your Company has 6 (Six) Directors consistingof 2 (Two) Independent Directors 1 (One) Woman Director 2 (Two) Executive Directorsincluding a Managing Director and 2 (Two) Non-Executive Directors as follows:
Mr. Binod Maharana - Chairman and Independent Director
Ms. Priti Gandhi - Independent Director
Mr. Jignesh Mehta - Managing Director and Chief Executive Director
Mr. Sagar Thanki - Executive Director and Chief Financial Officer
Mr. Shardul Shah - Non-Executive Director
Mr. Ravi Ramaiya - Non-Executive Director
During the year 2020-2021 there was no change in composition of Board.
As on March 31 2021 there was no disqualification of any Director pursuant to Section164 (2) of the Act.
As on March 31 2021 the Key Managerial Personnel of the Company were as follows:
Mr. Jignesh Mehta : Managing Director and Chief Executive Officer
Mr. Sagar Thanki : Executive Director and Chief Financial Officer and
Mr. Sunil Kumar Bang : Company Secretary and Compliance Officer.
During the financial year 2020-21 5 (Five) Board meetings were held on August 122020 August 24 2020 September 29 2020 December 11 2020 and March 6 2021. Theintervening gap between the meetings was within the period prescribed under the Act andSEBI (Listing Obligations and Disclosures Requirements) Regulations 2015 (hereinafterreferred to as the SEBI (LODR) Regulations 2015).
ATTENDANCE OF DIRECTORS AT BOARD MEETING:
|NAME OF THE DIRECTOR ||NATURE OF DIRECTORSHIP ||NUMBER OF MEETINGS ATTENDED |
|Mr. Binod Maharana ||Chairman and Independent Director ||5 |
|Mr. Jignesh Mehta ||Managing Director and Chief Executive Officer ||5 |
|Mr. Sagar Thanki ||Executive Director and Chief Financial Officer ||4 |
|Ms. Priti Gandhi ||Independent Director ||5 |
|Mr. Shardul Shah ||Non- Executive Director ||5 |
|Mr. Ravi Ramaiya ||Non- Executive Director ||5 |
DIRECTOR RETIRED BY ROTATION:
In accordance with provisions of Section 152 of the Act and the Articles of Associationof the Company Mr. Shardul Shah Non Executive Director retires by rotation at theensuing Annual General Meeting (AGM) and being eligible has offered himself forreappointment. Company's policy on directors' appointment and remuneration is available onthe website of the Company at https://www.secmark.in/code-and-policies
CHANGE IN KEY MANAGERIAL PERSONNEL:
During the year there was no change in Key Managerial Personnel of the Company.
DECLARATION BY INDEPENDENT DIRECTORS:
All Independent Director have provided declarations to the effect that they meet thecriteria of independence as laid down under Section 149(6) of the Act read with Regulation16 of SEBI (LODR) Regulations 2015. In the opinion of the Board Independent Directorsfulfill the conditions specified in the Act Rules made there under and SEBI (LODR)Regulations 2015.
MEETING OF INDEPENDENT DIRECTORS:
Pursuant to Section 149(8) to the Companies Act 2013 Independent Directors arerequired to hold atleast 1 (One) meeting without the attendance of Non-IndependentDirectors and members of management. Accordingly such meeting of Independent Directorswas held on March 6 2021. Independent Directors reviewed the performance ofNon-Independent Directors and the Board as a whole based on certain parameters set byIndependent Directors.
FORMAL ANNUAL EVALUATION OF THE PERFORMANCE OF THE BOARD AND INDIVIDUAL DIRECTORS:
During the year the Board of Directors has carried out an annual evaluation of its ownperformance and individual directors pursuant to a guidance note dated January 5 2017released by Securities and Exchange Board of India ("SEBI") on the evaluation ofthe board of directors of a listed company ("Guidance Note"). The performance ofthe Board and individual directors was evaluated by the Board after seeking inputs fromall the directors on the basis of criteria such as the Board composition and structureeffectiveness of Board processes information and functioning etc. In a separate meetingof Independent directors performance of Non-Independent Directors and the Board as awhole was evaluated taking into account the views of Executive Directors andNon-Executive Directors.
DISCLOSURE RELATED TO RESTRICTION ON PURCHASE BY COMPANY OR GIVING OF LOANS FORPURCHASE OF ITS SHARES:
During the year under review the Company has not provided any loan or financialassistance to any person for purchase or subscription of shares of the Company as per theprovisions of Section 67 of the Act. Hence no disclosure was required to be provided.
Your Company has one (1) Subsidiary Company M/s. Markets On Clouds Private Limited.Statement containing salient features of the financial statements of this SubsidiaryCompany in Form AOC-1 forms part of this Director's Report as "Annexure - I".
Your Company does not have any Joint Venture or Associate Company.
DISCLOSURE RELATED TO EMPLOYEE:
The information required under Section 197 of the Act read with Rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is given in"Annexure - II".
EMPLOYEE STOCK OPTION PLAN (ESOP):
Your Company has not granted any stock options to its employees under the existingscheme SecMark Employee Stock Option Scheme 2019 (hereinafter referred to an "ESOPScheme 2019") during the year.
The ESOP Scheme 2019 is in compliance with Securities and Exchange Board of India(Share Based Employee Benefits) Regulations 2014 the Securities and Exchange Board ofIndia (Share Based Employee Benefit and Sweat Equity) Regulations 2021 and Companies Act2013 and there has been no material changes to these plans during the financial year2020-21.
The summary information of ESOP Scheme 2019 of the Company is provided under Notes toAccounts under Standalone Financial Statements of the Annual Report.
No employee was granted options/ shares under ESOP Scheme 2019 during the year equalto or exceeding 1% of the issued capital.
Other details of ESOP Scheme 2019 are given in "Annexure-III".
Disclosures as required under the Securities and Exchange Board of India (Share BasedEmployee Benefits) Regulations 2014 the Securities and Exchange Board of India (ShareBased Employee Benefit and Sweat Equity) Regulations 2021 and Companies Act 2013 hasbeen placed on the website of the Company at the website https://www.secmark.in.
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION RESEARCH AND DEVELOPMENT:
The Company provides consultancy services and business solutions and as such itsoperations do not account for substantial energy consumption. However the Company adoptsall possible measures to conserve energy like using power only to the extent necessary andswitching off power when not needed. The particulars relating to the Conservation ofEnergy Technology Absorption as per Section 134(3)(m) of the Act read with the Rule 8(3)of the Companies (Accounts) Rules 2014 are given as below:
(A) Conservation of energy:
the steps taken or impact on conservation of energy: NIL
the steps taken by the company for utilizing alternate sources of energy: NIL
the capital investment on energy conservation equipment: NIL
(B) Technology absorption:
the efforts made towards technology absorption: Company has revamped its websiteusing latest technologies. Company has also developed certain software for internal &client use.
the benefits derived like product improvement cost reduction productdevelopment or import substitution: New website will ensure better presentability of theCompany and internal software will lead to increase efficiency.
in case of imported technology (imported during the last three years reckonedfrom the beginning of the financial year): Not applicable
the expenditure incurred on Research and Development: Not applicable
COMMITTEES OF THE BOARD:
Your Company has duly constituted Committees (Audit Committee Stakeholders'Relationship Committee Nomination and Remuneration Committee and Internal ControlCommittee) as required under the provisions of the Act & rules framed there under andSEBI (LODR) Regulations 2015. The details about the Committees are incorporated in"Annexure IV" forming part of this Director's Report.
SECRETARIAL STANDARD COMPLIANCES:
The Company complies with all applicable secretarial standards issued by the Instituteof Company Secretaries of India.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the requirement under section 134(5)of the Act the Board of Directorshereby confirm that:
a) In the preparation of the annual accounts for financial year ended March 31 2021the applicable accounting standards had been followed along with the proper explanationrelating to material departures if any;
b) The Directors had 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 endedMarch 31 2021 and of the profit and loss of the Company for that period;
c) The Directors had 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) The Directors had prepared the annual accounts on a going concern basis; and
e) The Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and
f) The Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
AUDITORS AND AUDITOR'S REPORT:
D. Kothary and Co Chartered Accountants (FRN No: 105335W) were appointed as StatutoryAuditors of the Company by the Members at the Annual General Meeting (AGM) held onSeptember 30 2019 to hold office for a period of five years till the conclusion of theAnnual General Meeting in 2024. In terms of Section 139 of the Act as amended by theCompanies (Amendment) Act 2017 notified on May 07 2018 appointment of Auditors need notbe ratified at every Annual General Meeting. Accordingly the notice convening the ensuingAnnual General Meeting will not carry any resolution for ratification of appointment ofStatutory Auditors. The Auditors have confirmed that they continue to fulfil the criteriafor appointment as Auditor's of the Company as prescribed under the Section 139 of the Actand The Companies (Audit and Auditors) Rules 2014.
Pursuant to Section 204 of the Act 2013 and Rule 9 of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Company has appointed K.P. Ghelani& Associates Practicing Company Secretaries to undertake Secretarial Audit of theCompany for the financial year ended March 31 2021. The Secretarial Audit Report formspart of the Director's Report and is annexed as "Annexure-V"
EXPLANATIONS OR COMMENTS ON QUALIFICATIONS RESERVATIONS OR ADVERSE REMARKS ORDISCLAIMAIRS MADE BY STATUTORY/SECRETARIAL AUDITORS:
There are no qualifications reservations or adverse remarks made by statutory orsecretarial auditor in their report for the financial year ended March 31 2021.
DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUBSECTION (12) OF SECTION 143OF THE ACT OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT:
There was no instance of fraud during the year under review which required theStatutory Auditors to report to the Audit Committee and/or Board of Company under Section143(12) of the Act and Rules framed there under.
DISCLOSURE OF COMMISSION:
According to section 197(14) of the Companies Act 2013 no Director received acommission from the Company and none of the Directors were disqualified from receipt ofany remuneration or commission from holding or subsidiary company.
DISCLOSURE ABOUT DISQUALIFICATION:
None of the Directors of the Company are disqualified u/s 164(2) of the Act.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
In pursuance of Section 186 of the Act the Company has made investment of Rs.6650349/- during the financial year ended March 31 2021. However during the year underreview Company has not given any loans or guarantees under the aforementioned section.
CONTRACT OR ARRANGEMENT WITH RELATED PARTIES U/S 188 (1) OF THE ACT:
The transactions entered into with related parties during the financial year were inthe ordinary course of business and on an arm's length basis as defined under the Act andwere in compliance with the provisions of Section 188 of the Act. All the related partytransactions arising in the ordinary course of business are placed periodically before theAudit Committee. For details of the related party transactions refer Note 23.3 ofFinancial Statement thereto. Also Form AOC-2 is annexed as "Annexure-VI".
MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT:
In terms of the provisions of Regulation 34 of SEBI (LODR) Regulations 2015 theManagement's Discussion and Analysis is set out in this Director's Report. Management'sDiscussion and Analysis Report provides details of the overall industry structuredevelopments performance and state of affairs of the Company's various businesses.
CONSOLIDATED FINANCIAL STATEMENTS:
The Consolidated Financial Statements of the Company for the Financial Year 2020-21 areprepared in compliance with the applicable provisions of the Act and Accounting Standards.The said Financial Statements have been prepared on the basis of the audited financialstatements of the Company and the subsidiary as approved by their respective Board ofDirectors. A statement containing the salient features of the Financial Statements ofSubsidiary Company in the prescribed format AOC-1 is annexed herewith as"Annexure-I" to the Director's Report.
During the year under review the Company has not accepted any deposits from public andas such no amount on account of principal or interest on deposits from public wasoutstanding as on March 31 2021 falling within the meaning of Section 73 of the Act andthe Companies (Acceptance or Deposits) Rules 2014.
FOREIGN EXCHANGE EARNINGS AND OUTGO:
During the year under review and previous year there have been no foreign exchangeearnings and outgo in the Company.
The Company has framed a risk management framework to identify business risk andchallenges across the Company. The risk framework helps us meet the business objectives byaligning operating controls with the mission and vision of the Company. After extensivedeliberation on the nature of risk and after adequate risk mitigations steps the businessactivities are being carried out under the direct supervision of the Board of Directors ofthe Company to ensure that no foreseeable risk involved in such an activity which maythreaten the existence of the Company.
CORPORATE SOCIAL RESPONSIBILITY:
The provisions of Section 135 of the Act for implementing Corporate SocialResponsibility Policy constitute committee and expenditure thereof is not applicable tothe Company.
MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY FROM THE END OFFINANCIAL YEAR AND TILL THE DATE OF SIGNING OF REPORT:
The material changes and commitments that impact financial position between end of thefinancial year and the date of this Director's Report is as under:
TradePlus Technologies LLP is a leading back office software vendor in securitiesmarket space and has various software applications details of which are as under:
(a) Trade Plus - software for back office package for stock brokers;
(b) ESTRO - software for back office / NSDL co-ordination billing and accountingsoftware for depository participants with NSDL;
(c) CROSS - software for back office / CDSL co-ordination billing and accountingsoftware for depository participants with CDSL;
(d) COMMEX - back office software for commodities derivatives;
(e) PMS - Portfolio management System for registered portfolio managers;
(f) TradeWeb - back office data access utility by client linked through web;
(g) eSign - module for digitally signing the documents and dispatch to email address ofthe client with maintenance of log;
(h) Internal CRM Software - software for managing the Transferor's customer relationsand queries;
(i) Website being www.tplus.in and any other website belonging to or owned by theTransferor; and
(j) Back office mobile application.
Your Company has entered into two agreement with Tradeplus Technologies LLP as statedbelow:
1. Software Purchase Agreement:
As per this agreement your Company has acquired exclusive rights to source codesproperty title and interest with all rights to further develop modify and sell all theabove software applications. The consideration payable to Trade Plus Technologies LLP isRs. 82100000/- plus GST.
2. Consultancy Agreement:
As per this agreement Tradeplus Technologies LLP and its partners shall offerconsultancy to your Company for a period of two years for further developments in theabove software applications for a consideration of Rs. 109550000/- plus GST. Amount ofRs. 52350000 shall be payable at the end of first year and amount of Rs. 57200000/-shall be payable at the end of second year.
REVISION OF FINANCIAL STATEMENT:
According to section 131 (1) of the Act it is not required to revise the financialstatement.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS COURTS OR TRIBUNALS IMPACTINGGOING CONCERN AND COMPANY'S OPERATION:
The Company has not received any significant and material orders passed by RegulatorsCourts or Tribunals during the year which may impact the going concern status of theCompany's and its operations in future.
In terms of Section 177 of the Act and SEBI (LODR) Regulations 2015 Company hasestablished a vigil mechanism for the Directors and employees. The Vigil Mechanism Policyis framed for carrying out investigation to conduct the enquiry in fair and unbiasedmanner to ensure that complete fact finding exercise has been undertaken and provide achannel to the Directors and employees to report genuine concerns or suspected fraud.
DISCLOSURE UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013:
The Company has zero tolerance towards sexual harassment at workplace and has adopted aPolicy on prevention prohibition and redressal of sexual harassment at workplace in linewith the requirements of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 and Rules made thereunder. As required under law anInternal Complaints Committee has been constituted for reporting and conducting inquiryinto the complaints made by the victim on the harassments at the work place. During theyear under review there were no cases filed or reported pursuant to the provisions of theSexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.
INTERNAL FINANCIAL CONTROLS:
In accordance with the provision of Section 134(5)(e) of the Act and as per theprovisions of the SEBI (LODR) Regulations 2015 the Company has an internal controlsystem commensurate with the size scale and complexity of its operations. Such internalfinancial controls were found to be adequate for the Company. The controls are largelyoperating effectively since there has not been identification of any material weakness inthe Company. The Company has policies and procedures in place for ensuring proper andefficient conduct of its business the safeguarding of its assets the prevention anddetection of frauds and errors the accuracy and completeness of the accounting recordsand timely preparations reliable financial information. The Internal Auditors monitor andevaluate the effectiveness and adequacy of internal control system in the Company itscompliance with operating systems accounting procedures and policies at all locations ofthe Company and its subsidiaries. Based on the report of Internal Auditors process ownersundertake corrective action in their respective areas and thereby strengthen the controls.Significant audit observations and corrective actions thereon are presented to the AuditCommittee of the Board.
Your Directors take this opportunity to thank the shareholders employees auditorscustomers suppliers bankers business partners associates financial institutions andcentral and state governments for their consistent support to the Company.
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For and on behalf or the Board SECMARK CONSULTANCY LIMITED
|Date: 25/08/2021 Place: Mumbai ||Jignesh Mehta Managing Director & CEO (DIN: 07929488) ||Sagar Thanki Executive Director & CFO (DIN: 08281489) |