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Sumedha Fiscal Services Ltd.

BSE: 530419 Sector: Financials
NSE: N.A. ISIN Code: INE886B01012
BSE 15:35 | 22 Jun 27.50 -0.70
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NSE 05:30 | 01 Jan Sumedha Fiscal Services Ltd
OPEN 28.00
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VOLUME 4340
52-Week high 58.30
52-Week low 24.05
P/E 6.24
Mkt Cap.(Rs cr) 22
Buy Price 0.00
Buy Qty 0.00
Sell Price 27.50
Sell Qty 80.00
OPEN 28.00
CLOSE 28.20
VOLUME 4340
52-Week high 58.30
52-Week low 24.05
P/E 6.24
Mkt Cap.(Rs cr) 22
Buy Price 0.00
Buy Qty 0.00
Sell Price 27.50
Sell Qty 80.00

Sumedha Fiscal Services Ltd. (SUMEDHAFISCAL) - Director Report

Company director report

Dear Members

Your Directors are pleased to present the Twenty-Eighth Annual Report together with theAudited Financial Statements for the year ended March 31 2017.

Financial mghlights (' in Lacs)

Year ended 31.03.2017 Year ended 31.03.2016
Total Income 1647.83 1174.28
Cash Profit 485.42 200.91
Less : Depreciation 44.08 47.58
Profit before Tax 441.34 153.33
Less : Provision for T axation 139.40 47.14
Add / (Less) : Deferred T ax (8.28) (5.11)
Profit after Tax (Net of adjustment for earlier years) 296.61 95.67
Add : Surplus brought forward 2060.53 2012.91
Balance available for appropriation 2357.14 2108.58
APPROPRIATION
Provision for Dividend (Including Dividend Tax)* - 48.05
Balance carried to Balance Sheet 2357.14 2060.53

* The Board of Directors at its meeting held on May 20 2017 has proposed a dividendof' 1.00 per equity share aggregating to ' 96.09 lakhs inclusive of tax on dividend. Theproposal is subject to the approval of shareholders at the forthcoming Annual GeneralMeeting. In terms of revised Accounting Standard (AS-4) - Contingencies and EventsOccurring after the Balance Sheet date [as notified by the Ministry of corporate affairsthrough amendments to Companies (Accounting Standards) Amendment Rules 2016] the Companyhas not appropriated proposed dividend from Statement of Profit and Loss for the yearended March 31 2017.

Operational Review

In 2016-17 your Company's total Income from Operations stood at ' 1487.48 lacs asagainst ' 1094.00 lacs during the previous year an increase of 35.97% over last year.

Your Company continued its focus on fee based activities (Investment Banking) andincome therefrom was ' 871.12 lacs as against ' 694.98 lacs during the previous yearrecording an increase of 25.35%. It continues to be the thrust area for the Company.

Income from Capital Market Operation for the year has been ' 268.21 lacs as against '229.80 lacs during the previous year an increase of 16.72% over last year.

Income from Other Sources was at ' 80.10 lacs as against ' 80.28 lacs during theprevious year.

There has not been any change in the nature of business of the Company.

Finance & Accounts

Your Company prepares its financial statements in compliance with the requirements ofthe Companies Act 2013 and applicable Accounting Standards issued by the Institute ofChartered Accountants of India. The financial statements have been prepared on historicalcost basis. The estimates and judgments relating to the financial statements are made on aprudent basis so as to reflect in a true and fair manner the form and substance oftransactions and reasonably present the Company's state of affairs profits and cash flowsfor the year ended March 31 2017.

Dividend & Reserves

The Board of Directors is pleased to recommend a dividend of ' 1/- per share (10%) forthe year ended March 31 2017 subject to the approval of the Members at the 28th AnnualGeneral Meeting.

During the year under review ' 20505/- (Previous year 20505/-) was transferred toGeneral Reserve.

Employee Stock Option Scheme

Details of the shares issued under SFSL Employees Stock Option Scheme (ESOP Scheme) asalso the disclosures in compliance with Section 62 of Companies Act 2013 and Rule 12 ofCompanies (Share Capital and Debentures) Rules 2014 and SEBI (Share Based EmployeeBenefits) Regulations 2014 are set out in the Annexure - I to this Report.

Pursuant to approval of Members (on March 24 2011) through Postal Ballot the Companyadopted the SFSL Employee Stock Option Scheme 2011. Accordingly the employees of theCompany (including its subsidiary) are eligible for grant of conditional rights to receiveEquity Shares (' 10/- each) at an issue price of ' 11/- each. The grant will vest only onfulfillment of conditions as contained in the ESOP Scheme. The ESOP Scheme is subject tostatutory restrictions as applicable. No share or right of entitlement has been issuedthereunder during the year under review. There has been no change in the Scheme during theFY 2016-17.

Share Capital

The Paid-up Equity Share Capital as at March 31 2017 stood at ' 79844240/-. Duringthe year under review the Company has not issued shares with differential voting rightsnor has granted any stock options or sweat equity. As on March 31 2017 none of theDirectors of the Company hold instruments convertible into equity shares of the Company.

Management Discussion and Analysis Report

In terms of requirements of Regulation 34 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 (SEBI LODR) a Management Discussion andAnalysis Report is attached Annexure - II forming part of this Report.

Report on Corporate Governance

In terms of requirements of Regulation 34 of the SEBI LODR a Report on CorporateGovernance together with Auditors' Certificate regarding compliance of Conditions ofCorporate Governance are attached as Annexure - III and Annexure - IV forming part ofthis Report.

Subsidiary & Associate Companies and Consolidated Financial Statements

As required under Section 129 (3) of the Companies Act 2013 (the Act) and Regulation24 of the Listing Regulations 2015 Consolidated Financial Statements of the Company andits Subsidiary and Associate Companies prepared in accordance with the applicableAccounting Standards issued by The Institute of Chartered Accountants of India areappended to the Annual Report.

Brandshoots Ventures Pvt. Ltd. (a joint venture) has become an Associate Company u/s.2(6) of the Companies Act 2013 during the FY 2016-17. The Company would address thegrowing need for eco-system to support start-up entities for their non-coreactivities/services more so in Eastern region of India.

Accordingly a statement in Form AOC-1 is attached to the Financial Statements of theCompany for your information.

Performance Subsidiary

• SFSL Commodity Trading Pvt. Ltd. - Subsidiary

During the year the Company recorded Total Revenue of ' 1622422/- (previous year '1559304/-) and Net Profit of ' 99296/- for the year ended 31st March 2017 (PreviousYear : ' 98487/-).

The Company continues to explore growth opportunities.

Performance of Associate Companies

• Capita Finance Services Ltd.

During the year the Company recorded Total Revenue of ' 1513584/- (previous year '623040/-) and Net profit of ' 619485/- for the year ended 31st March 2017 againstLoss in the Previous Year of ' 1089191/-. The Company continues to explore growthopportunities.

• SFSL Insurance Advisory Services Pvt. Ltd.

During the year the Company recorded Total Revenue of ' 78394/- (previous year '124960/-) and Net Profit of ' 16276/- for the year ended 31st March 2017 (PreviousYear: ' 64978/-).

The Company continues to explore growth opportunities.

• SFSL Risk Management Services Pvt. Ltd.

During the year the Company recorded Total Revenue of ' 107475/- (previous year '154432/-) and Net Profit of ' 12566/- for the year ended 31st March 2017 (PreviousYear of ' 60577/-).

The Company continues to explore growth opportunities.

• US Infotech Pvt. Ltd.

During the year the Company recorded Total Revenue of ' 2251396/- (previous year '2198931/-) and Net Profit of ' 614747/- for the year ended 31st March 2017 (PreviousYear : ' 746187/-).

The Company continues to explore growth opportunities.

• Brandshoots Ventures Pvt. Ltd.

Brandshoots Ventures Pvt. Ltd. is incorporated on 06th October 2016. During the yearthe Company has not yet generated any revenue and booked Net Loss of ' 386726/- for theyear ended 31st March 2017.

The Company is building requisite eco-system to support start-up entities.

Corporate Social Responsibility

The Company is not yet required to comply to with the requirement associated withSection 135 of the Companies Act 2013.

Business Responsibility Report

The Company is not required to comply with the requirements associated with Regulation34(2)(f) of the Listing Regulations 2015.

Transfer Of Unpaid And Unclaimed Amounts To Investor Education And Protection Fund(Iepf)

Pursuant to the provisions of the Companies Act 2013 read with IEPF Authority(Accounting Audit Transfer and Refund) Rules 2016 as amended declared dividends whichremained unpaid or unclaimed for a period of seven years have been transferred by theCompany to the IEPF which has been established by the Central Government. The abovereferred rules now mandate transfer of dividends lying unpaid and unclaimed for a periodof seven years as well as the underlying equity shares to IEPF. The Company has completedthe process of transfer of the unclaimed shares to the extent notified by the Ministry ofCorporate Affairs.

Diretors' Responsibility Statement

To the best of knowledge and belief and according to the information and explanationsobtained by them your Directors make the following statement in terms of Section134(3)(c) of the Companies Act. 2013:

(i) that in the preparation of the Annual Accounts for the year ended March 31 2017the applicable accounting standards have been followed and there are no materialdeparture;

(ii) and applied them consistently and made judgments and estimates that are reasonableand prudent so as to give a true and fair view of the state of affairs of the Company asat March 31 2017 and profits of the Company for the year ended on that date;

(iii) that Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;

(iv) the annual accounts have been prepared on a going concern basis;

(v) that 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

(vi) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.

Directors

Members of the Company at its 27th Annual General Meeting held on 17th September 2016approved reappointment and Remuneration of Mr. Bhawani Sankar Rathi as "WholetimeDirector" for a period of 3 (three) years with effect from April 1 2016.

In accordance with the provisions of Section 152 of the Companies Act 2013 and theCompany's Articles of Association Mrs. Garima Maheshwari (DIN - 07001628) Directorretire by rotation at the forthcoming Annual General Meeting and being eligible offerherself for re-appointment.

The Company has duly received Declarations from all the Independent Directors pursuantto Section 149(6) & (7) of the Companies Act 2013.

Number of Meetings of the Board

The details of the number of meetings of the Board held during the Financial Year 2016- 17 form part of the Corporate Governance Report.

Key Managerial Personnel (KMP)

The Company is having the following Key Managerial Personnel during the year -

Name Designation
Mr. Bhawani Sankar Rathi Wholetime Director
Mr. Deb Kumar Sett Company Secretary
Mr. Girdhari Lal Dadhich Chief Financial Officer

Committees of the Board

The Board of Directors has the following Committees:

1. Audit Committee

2. Nomination and Remuneration Committee

3. Stakeholders' Relationship Committee

The details of the Committees along with their composition number of meetings andattendance at the meetings are provided in the Corporate Governance Report.

Board Evaluation

The Securities and Exchange Board of India has issued a guidance note on BoardEvaluation with indicative criteria for evaluation of the Board Committees thereof andindividual Directors. The performance evaluation system as prescribed has been approvedby the Nomination and Remuneration Committee. It included factors

like composition quality roles and responsibilities processes and functioningadherence to Code of Conduct and ethics. The Board has adopted the same and conducted theevaluation process accordingly.

The assessment of the Independent Directors on the performance of the Board and itsCommittees were subsequently discussed by the Board at its meeting. Evaluation ofperformance of Non-Independent Directors are done by Independent Directors on key personaland professional attributes. Similar performance evaluation of Independent Directors wasconducted by the Board excluding the Director being evaluated.

Loans Guarantees or Investments

Details of Loans Guarantees and Investments covered under the provisions of Section186(4) of the Companies Act 2013 [the Act] are provided in the Notes to FinancialStatements.

Vigil Mechanism / Whistle Blower Policy

The Company has a Whistle Blower Policy to report genuine concerns or grievances. TheWhistle Blower Policy has been posted on the website of the Company

Remuneration and Nomination Policy

The Company is having a Nomination and Remuneration Policy for determining remunerationof its Directors Key Managerial Personnel and Senior Management. The Policy inter alialays down criteria for selection and appointment in senior management. The details of thispolicy has been posted on the website of the Company

The Remuneration Policy has also been outlined in the Corporate Governance Reportforming part of this Annual Report.

Related Party Transactions

All transactions entered with Related Parties for the year under review were on arm'slength basis and required particulars such transactions are disclosed in form AOC-2 interms of Section 134 of the Companies Act 2013. Further there is no material relatedparty transaction during the year.

All Related Party Transactions are placed before the Audit Committee as well as theBoard of Directors on a quarterly basis. There has not been any Omnibus approval for suchtransactions pursuant to Regulation 23 of the Listing Regulations 2015.

The particulars of Contracts or Arrangements made with related parties pursuant toSection 188(1) of the Companies Act 2013 furnished in Form AOC - 2 is attached to thisReport as Annexure - V.

In line with the requirements of the Companies Act 2013 and Listing Regulations yourCompany has formulated a Policy on Related Party Transactions which is also available onThe Policy intends to ensure that proper reporting approval and disclosure processes arein place for all transactions between the Company and Related Parties.

Deposits

The Company has neither accepted nor renewed any deposits during the year. No deposithas remained unpaid or unclaimed at the end of the year under review.

Going Concern Status

No significant and material orders have been passed by the Regulators or Courts orTribunals impacting the going concern status of the Company and its operation in thefuture.

Material Changes and Commitments

There has not been any material change and commitment affecting the financial positionof the Company occurred between the end of the Financial Year 2016-17 and the date of theReport.

Compliance System

Based on the Reports of Statutory Compliance from Departmental Heads/ ResponsibilityCentres as aforesaid the Company Secretary issues Certificate under Section 205 of theCompanies Act 2013 (Act) and Rules made thereunder. The Certificate is also endorsed bythe Wholetime Director of the Company.

The status of Statutory Compliance is verified by the Internal Auditors and SecretarialAuditors pursuant to Sections 138 and 204 of the Companies Act 2013.

Annual Return

The extract of Annual Return pursuant to the provisions of Section 92 of the CompaniesAct 2013 read with Rule 12 of the Companies (Management and Administration) Rules 2014in Form - MGT-9 is attached to this Report as Annexure - VI.

Auditors

Statutory Auditors

M/s. ARSK & Associates Chartered Accountants (Firm Registration No. 315082E)Statutory Auditors have completed their prescribed tenure with the Company (two terms offive consecutive years) under Section 139(2) of the Companies Act 2013 (the Act) [readwith Order No. S.O. 2264 (E) dated 30th June 2016 issued by the Ministry of CorporateAffairs]. Their tenure of appointment (for FY 2016-17) expires at the conclusion of the28th AGM of the Company.

Accordingly as per the said requirements of the Act M/s. V. Singhi & AssociatesChartered Accountants (Firm Registration No. 311017E) are proposed to be appointed asauditors for a period of 5 years commencing from the conclusion of 28th AGM till theconclusion of the 33rd AGM subject to ratification by shareholders every year as may beapplicable in place of M/s. ARSK & Associates Chartered Accountants.

M/s. V. Singhi & Associates Chartered Accountants have consented to the saidappointment and confirmed that their appointment if made would be within the limitsspecified under Section 141(3)(g) of the Act. They have further confirmed that they arenot disqualified to be appointed as statutory auditor in terms of the provisions of theproviso to Section 139(1) Section 141(2) and Section 141(3) of the Act and the provisionsof the Companies (Audit and Auditors) Rules 2014.

The Audit Committee and the Board of Directors recommend the appointment of M/s. V.Singhi & Associates Chartered Accountants as statutory auditors of the Company fromthe conclusion of the 28th AGM till the conclusion of 33rd AGM to the shareholders.

Secretarial Audit

In terms of the requirements of Section 204 of the Companies Act 2013 and theCompanies (Appointment & Remuneration of Managerial Personnel) rules 2014 M/s. A. K.Labh & Co. Practicing Company Secretaries was appointed to conduct the SecretarialAudit of the Company for FY 2016-17 (in place of Mr. Babu Lal Patni Company Secretary inPractice). Mr. Patni had expressed his inability to continue as Secretarial Auditor (videhis letter dated October 27 2016).

Based on the consent received from M/s. A. K. Labh & Co. and recommendation of theAudit Committee the Board has appointed them as Secretarial Auditor of the Company for FY2017-18.

The Secretarial Audit Report for FY 2016-17 (attached as Annexure - VII) is free fromany qualification.

Cost Audit

The Company is not engaged in production of goods or providing services pursuant toSection 148 of the Act and therefore not required to comply with the requirementsthereunder.

Board's Response on Auditors' Qualification Reservation or Adverse Remark orDisclaimer Made There are no qualifications reservations or adverse remarks made by theStatutory Auditors in their report or by

the practicing company secretary in their secretarial audit report. During the yearthere has been no instances of frauds reported by auditors under section 143(12) of theCompanies Act 2013.

Significant and Material Orders Passed by the Courts/ Regulators

None.

Information Required Under Sexual Harassment of Women at Workplace (PreventionProhibition And Redressal) Act 2013

The Company is having Internal Complaints Committees as required under the SexualHarassment of Women at Workplace (Prevention Prohibition and Rehabilitation) Act 2013.During the year no complaint regarding sexual harassment was received by the saidCommittee.

Conservation of Energy and Technology Absorption

Since the Company does not own any manufacturing facility the other particularsrelating to conservation of energy and technology absorption stipulated in the Companies(Accounts) Rules 2014 are not applicable.

Foreign Exchange Earning and Outgo

Foreign Exchange earnings and outgo during the year under review were ' 77.47 Lacs(previous year ' Nil) and ' 9.10 Lacs (previous year ' 0.40 lac) respectively.

Risk Management

The Company as an Intermediary registered with the Securities and Exchange Board ofIndia (SEBI) is required to comply with the prescribed risk management measures.Accordingly the quarterly status of various risks being faced by the Company and measuresfor mitigation thereof are placed before the Audit Committee and Board of Directors of theCompany for review and appropriate measures. Further details about the pertinent risksare contained in the statement of Management Discussion and Analysis (Annexure II).

Particulars of Employees

The ratio of the remuneration of each Director to the median employee's remunerationand other particulars or details of employees pursuant to Section 197(12) of the CompaniesAct 2013 read with Rule 5 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are attached to this Report as Annexure VIII. None of the employeesof the Company is in receipt of remuneration coming under purview of the saidSection/Rule.

Appreciation

We acknowledge our appreciation to Shareholders Bankers Regulators National StockExchange Multi-Commodity Exchange Bombay Stock Exchange and Clients for their continuedsupport. The Board also takes this opportunity to express its whole-hearted appreciationof the efforts put in by the employees at all levels. We look forward to the future withconfidence and stand committed to creating a brighter future for all shareholders.

On Behalf of the Board

Place : Kolkata Ratan Lal Gaggar

Date : May 20 2017 Chairman

MANAGEMENT DISCUSSION & ANALYSIS

ECONOMY: REVIEW

India has seen a flurry of reforms over the past couple of years. Introduction of GSTwould do away with the existing fragmented jurisdictions of multiple indirect taxauthorities restricting flow of inputs and outputs throughout India. The prevailing systemof collection of various levies severely distorted the flow. GST is a destination-basedtax levied on the value addition in the goods and services done at each stage and comesequipped with input tax credit mechanism. Implementation of GST would convert India into‘One nation one market' sharply reducing the logistics cost in transportation ofgoods. Implementation of GST would improve the ease of doing business in the country andprevent unhealthy competition among states to attract manufacturing bases.

The government's push to drive the Aadhar framework for the transfer of social sectorbenefits has paid off handsomely. Leakage of the targeted benefits has come downsignificantly releasing more funds for further welfare activities.

The BHIM-Aadhar digital payments platform enables every Indian to pay digitally usingtheir biometric data on a merchant's biometric-enabled device. The BHIM-Aadhar will belike a Smart Phone with a biometric reader and would boost digital payments in a mannerunprecedented anywhere in the world. Any citizen without access to Smart Phone Internetdebit or credit cards will be able to transact digitally through the BHIM-Aadhar platform.All these initiatives would deliver purchasing power to poor and marginalized people andconsequently improve their quality of living. These would call for supply side of theeconomy to address consequent inflation. The structural initiatives would be "anenabler" and boost the true potential of Indian economy.

Capital Markets

Indian Capital Market have shown significant growth in the post Liberalization era. Itremains one of the most resilient economy globally and poised to be one of the topdestinations for domestic and global businesses to expand and invest into. As globaleconomy moves for gradual recovery India has shown extraordinary strength to bounce backwith greater stability and sustainability. Raising capital is a strategic priority acrossIndia and role of Capital Markets has assumed far greater importance and urgency. The Debtmarket still needs to be developed to invite capital inflows needed for massiveinfrastructure development. The frontiers of global markets are not only increasing butalso moving towards process of convergence. FIIs inflows into the Indian equity marketshave touched new heights.

The efforts of the Regulators and the Government to protect the interests of investorsin securities and to promote the development of and to regulate the securities markettowards enlightened Governance has been lauded by all stake holders. There is hugepotential for the capital markets growth as at present just 2% of the population accountfor retail investors and the lowest strata of the pyramid still remains untapped. The realinclusive growth also needs penetration of capital market to the last mile.

Relieving Banks from NPA

A stable and sound banking system is required for a healthy growth of an economy. Butballooning non-performing assets (NPA) problem is the biggest impediment that chokesIndian lenders' effective operations. Various methods prescribed by Reserve Bank of Indiafailed to provide relief to the ever growing problem. In spite of empowerment with requireauthority Banks were hesitant to exercise their authority.

Ultimately the government has empowered RBI to decide on recovery of NPAs throughNational Company Law Tribunal (NCLT) in the manner prescribed under the Insolvency andBankruptcy Code 2016 (IBC). Insolvency Professionals (IPs) with prescribed qualificationand experience are to play critical roles of taking over the NPAs assume management ofthe borrower acting as mediator between the lender and borrower and disposal of NPAs byway of disposal of assets/undertaking of the borrower in the prescribed manner undersupervision of NCLT. Recovery process pending before BIFR would also be decided by theNCLT.

The entire process under IBC is required to be completed within 180 days extendableupto 270 days. IPs have critical roles to play in the process and much of the successwould depend on their capacity and effectiveness.

Outlook

Economic growth is projected to remain strong and India to remain the fastest growingG20 economy. The increase in public wages and pensions will support consumption. Directbenefit transfer to the target beneficiary through bank account supported by Aadharidentity and accessible through mobile phone would percolate purchasing power to poorersegment of the population would generate income and welfare to the under priviledged.

Private investment will recover gradually as excess capacity diminishes and thelandmark Goods and Services Tax and other measures to improve the ease of doing businessare being implemented. However large non-performing loans and high leverage of somecompanies are holding back investment.

Monetary policy is projected to remain tight as inflation expectations have still notfully adjusted down. The need to reduce the relatively high public-debt-to-GDP ratioleaves little room for fiscal stimulus. However investing more in physical and socialinfrastructure is critical to raising living standards for all.

Restoring credit discipline and cleaning up banks' balance sheets will be instrumentalto support the credit growth needed to finance more business investment. Trade opennesshas increased partly driven by a competitive service sector. Manufacturing has laggedbehind with limited contribution to exports and job creation. Promoting job creation inmanufacturing would require reducing further restrictions on FDI and trade modernisinglabour regulations and providing better education and skills. Better infrastructuretransport and logistic services would facilitate manufacturing firms' access to globalmarkets particularly from remote and poorer regions.

Highlights of Financial Performance during FY 2016-17

• Total Income from Operation of ' 1487 Lacs (' 1094 Lacs for FY16)

• Profit Before Tax of ' 441 lacs (' 153 lacs in FY16)

• Net Profit of ' 297 lacs (' 96 lacs in FY16)

• Basic EPS after extra ordinary items stood at ' 3.71 compared to ' 1.20 inFY16.

BUSINESS OVERVIEW

Investment Banking

Investment Banking continues to be the major revenue earning division of the Companycontributing around 59% to total revenue for the year under review. Performance of thissegment improved overall in revenue terms but below its potential due to stagnantinvestment climate in the economy and weak corporate investment activity. The Companyprovides merchant banking loan syndication financial restructuring portfolio resolutionof stressed assets M&A and equity placements under its investment banking division.In spite of challenging situation in the market Income from this segment has recorded '871 lacs (previous year ' 695 lacs).

Capital Market Operation

Capital Market Division of the Company offers equity currency and commodity brokingand wealth management for institutional and individual clients.

The market remained buoyant during most of the year and driven mainly by transactionsfrom FIIs and domestic Institutions as well. Participation of common man has been verylow. The scenario is featured with low margin high investment in hardware and softwarehigh compliance cost and growing regulatory requirements. However the Company has recordedan income of ' 188 lacs against ' 230 lacs during FY16.

Risks & Concerns

The company is subject to following broad risks

• Operational Risk

• Market Risk

• Financial Risk

• Compliance Risk

The Company is having a system of risk management commensurate with its size and natureof activities to address the consequent vulnerability. Quarterly reports on relevant areasare placed before the Audit Committee and the Board of Directors of the Company. All majorrisks are identified monitored and acted upon within the internal framework. However theCompany is not yet required to constitute a Risk Management Committee pursuant toRegulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

Internal Control Systems

The Company currently operates in areas related to Investment Banking WealthManagement and Broking Services. The Company is having all the required regulatoryapprovals with clear demarcation of operational and compliance responsibilities. Quarterlystatus thereof are reviewed by the Internal Auditors (external) and placed before theAudit Committee and the Board for remedial measures if any.

There has been no material developments in the area of Human Resources.

The Company had 72 permanent employees during the year under review.

Cautionary Statement

This Management Discussion and Analysis provides the details of the Company objectives.Statements detailed here are not exhaustive but are for information purposes only. Theactual performance of the Company in future may vary substantially from those outlinedherein. Some of the statements written herein are forward looking and should not beconstrued as a guarantee of performance. The readers must exercise their due diligencebefore forming any opinion based on this statement.

On Behalf of the Board

Place : Kolkata Ratan Lal Gaggar

Date : May 20 2017 Chairman

CORPORATE GOVERNANCE REPORT

The Directors present the Company's Report on Corporate Governance for the year endedMarch 31 2017. COMPANY'S PHILOSOPHY

The Company's corporate governance philosophy encompasses regulatory and legalrequirements which aims at a high level of business ethics effective supervision andenhancement of value for all stakeholders.

Board of Directors

The Company has a broad-based Board of Directors constituted in compliance with theCompanies Act 2013 and Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015. The Board functions either as a full Board orthrough various committees constituted to oversee specific operational areas. The Boardhas constituted various committees namely Audit Committee Remuneration & NominationCommittee Stakeholders Relationship Committee and Management Committee.

During the financial year 2016-17 the Board met four times on May 28 2016; August 62016; November 5 2016 and February 4 2017. The maximum interval between any two meetingswas well within the maximum allowed gap of 120 days.

The details of each member of the Board along with the number of Directorship(s)/Committee Membership(s)/ Chairmanship(s) are provided herein below:

Composition of the Board and Committees as on 31st March 2017

Name Category Directorship in other companies# Membership(s) in committees of other companies## Chairman-ship(s) in committees of other companies## Date of joining
Mr. Ratan Lal Gaggar Chairman ID 9 7 2 30-Mar-93
Dr. Basudeb Sen ID 2 2 - 28-Dec-05
Mr. Atul Chandra Varma ID - - - 13-Nov-10
Mr. Vijay Maheshwari NED & P 3 - - 04-Jul-92
Mr. Prashant Sekhar Panda ID 2 - - 24-Jan-09
Mr. Prabhat Agarwala ID - - - 16-May-15
Mr. Anil Kumar Birla NED - - - 30-Nov-05
Mr. Bhawani Sankar Rathi WD & P - - - 01-Mar-94
Mr. Bijay Murmuria NED & P 2 - - 04-Jul-92
Mrs. Garima Maheshwari R NED - - - 08-Nov-14

ID - Independent Director; NED - Non-Executive Director; P - Promoter; WD - WholetimeDirector # Excluding Private Limited Companies Foreign Companies Section 8 Companies.

## Includes only Audit Committee and Stakeholders Relationship Committee.

R Mrs. Garima Maheshwari is daughter-in-law of Mr. Vijay Maheshwari

Appointment and Tenure

The Directors of the Company are appointed by Members at the General Meetings. Inaccordance with the Article of Association of the Company. All the Directors except theWholetime Director and Independent Directors of th Company are liable to retire byrotation.

The Wholetime Director serves in accordance with the terms of the contract of servicewith the Company as approved by the Members.

As regards the appointment and tenure of Independent Directors the Company has adoptedthe provisions with respect to appointment and tenure of Independent Directors which areconsistent with the Companies Act 2013 and Listing Regulations -

• The Independent Directors will serve a maximum of two terms of five years each.

• The Company would not have any upper age limit of retirement of IndependentDirectors from the Board and their appointment and tenure will be governed by provisionsof the Companies Act 2013.

Board Independence

Our definition of ‘Independence' of Directors is derived from Regulation 16 ofListing Regulations and Section 149(6) of the Companies Act 2013. The status ofindependence is determined based on the confirmation / disclosures received from theDirectors and on evaluation of the relationships disclosed. The status of independence ofDirectors has been provided in the preceding paragraph/table.

Separate Independent Directors' Meetings

The Independent Directors meet at least once in a year without the presence ofExecutive Directors or Management representatives. They also have a separate meeting withthe Non-Executive Chairman to discuss issues as mandated by applicable laws.

In addition to these formal meetings interactions outside the Board meetings also takeplace between the Chairman and the Independent Directors.

Directors' Induction and Familiarization

The provision of an appropriate induction programme for new Directors and ongoingtraining for existing Directors is a major contributor to the maintenance of highCorporate Governance standards of the Company. The Chairman and the Wholetime Director andother senior Directors take appropriate steps for ensuring that such induction andtraining programmes are provided to Directors. The Independent Directors from time totime request management to provide detailed note on any specific project activity orprocess of the Company. The management provides such information and imparts trainingwhenever required.

The details of Directors' induction and familiarization are available on the Company'swebsite

Performance evaluation of the Board Committees and Directors

Securities Exchange Board of India (SEBI) vide its circular No. SEBI/HO/CFD/CMD/CIR/P/2017/004 dated 5th January 2017 had issued a guidance note on Board Evaluationwhich inter alia contains indicative criteria for evaluation of the Board of Directorsits Committees and the individual members of the Board.

The Board of Directors at its Meeting held on 4th February 2017 had considered andadopted the indicative criteria for evaluation of the Board of Directors the Committeesof the Board and the individual directors as enumerated in the said Circular and amendedthe Board evaluation framework accordingly.

Pursuant to the new Evaluation Framework adopted by the Board the Board evaluated theperformance of the Board its Committees and the Individual Directors for the financialyear 2016-17. After the evaluation process was complete the Board was of the view thatthe performance of the Board as a whole was adequate and fulfilled the parametersstipulated in the evaluation framework. The Board also ensured that the Committeesfunctioned adequately and independently in terms of the requirements of the Companies Act2013 and the Listing Regulations and at the same time supported as well as coordinatedwith the Board to help in its decision making. The individual Directors' performance wasalso evaluated and the Board was of the view that the Directors fulfilled their applicableresponsibilities and duties as laid down by the Listing Regulations and the Companies Act2013 and at the same time contributed with their valuable knowledge experience andexpertise to avail the opportunity and counter the adverse challenges faced by the Companyduring the year.

COMMITTEES OF THE BOARD

The Board Committees play a crucial role in the governance structure of the Company andhave been constituted to deal with specific areas / activities which concern the Companyand need a closer review. The Board Committees

are set up under the formal approval of the Board to carry out clearly defined roleswhich are considered to be performed by members of the Committee as a part of goodgovernance practice. The Board supervises the execution of its responsibilities by theCommittees. The Chairman of the respective Committee informs the Board about the summaryof the discussions held at the Committee Meetings. The minutes of the meetings of allCommittees are placed before the Board for review. The Board Committees can requestspecial invitees to join the meeting as appropriate.

The Board has currently established the following statutory and non-statutoryCommittees -

AUDIT COMMITTEE

The Audit Committee of the Board comprises of 4 Directors including 3 IndependentDirectors. The Members of the Audit Committee have wide exposure and knowledge in area offinance and accounting. The role and terms of reference of the Audit Committee covers theareas mentioned under Regulation 18 of Listing Regulations and Section 177 of theCompanies Act 2013. The Audit Committee inter alia provides reassurance to the Board onthe existence of an effective internal control environment.

The Company's Audit Committee as on 31st March 2017 comprised of three IndependentDirectors and one Non-Executive Director. The Audit Committee is headed by Mr. PrashantSekhar Panda and has Mr. Atul Chandra Varma Mr. Prabhat Agarwala and Mr. Bijay Murmuriaas its members. All the members of the Committee have relevant experience in financialmatters.

The Audit Committee of the Company is entrusted with the responsibility to supervisethe Company's internal controls and financial reporting process and inter alia performsthe following functions:

• overseeing the Company's financial reporting process and disclosure of financialinformation to ensure that the financial statements are correct sufficient and credible;

• reviewing and examining with management the quarterly financial results beforesubmission to the Board;

• reviewing and examining with management the periodical financial statementsbefore submission to the Board and the auditors' report thereon;

• review management discussion and analysis of financial condition and results ofoperations;

• scrutiny of inter-corporate loans and investments if any made by the Company;

• reviewing with management the annual financial statements as well as investmentsmade by the unlisted subsidiary companies;

• reviewing approving or subsequently modifying any Related Party T ransactionsin accordance with the Related Party Transaction Policy of the Company;

• approving the appointment of Chief Financial Officer after assessing thequalifications experience and background etc. of the candidate;

• recommending the appointment remuneration and terms of appointment of StatutoryAuditors of the Company and approval for payment of any other services;

• reviewing and monitoring the auditor's independence and performance andeffectiveness of audit process;

• reviewing management letters / letters of internal control weaknesses issued bythe Statutory Auditors;

• discussing with Statutory Auditors before the commencement of audit on thenature and scope of audit as well as having post-audit discussion to ascertain area ofconcern if any;

• reviewing with management Statutory Auditors and Internal Auditor the adequacyof internal control systems;

• reviewing the financial statements in particular the investments made by theunlisted subsidiaries;

• recommending appointment remuneration and terms of appointment of InternalAuditors of the Company;

• reviewing the adequacy of internal audit function and discussing with InternalAuditor any significant finding and reviewing the progress of corrective actions on suchissues;

• evaluating internal financial controls and risk management systems;

• evaluating undertaking or assets of the Company wherever necessary;

• reviewing the functioning of the Whistle Blowing mechanism;

The Audit Committee ensures that it has reviewed each area that it is required toreview under its terms of reference and under applicable legislation or by way of goodpractice. This periodic review ensures that all areas within the scope of the Committeeare reviewed.

Audit Committee meets quarterly for consideration/review of financial results variousbusinesses/functions business risk assessment controls internal audit and controlassurance reports of all the major divisions of the Company. The Committee is governed bythe terms of reference which are in line with the regulatory requirements mandated by theAct and Listing Regulations. The Audit Committee also reviews the functioning of the Codeof Business Principles and Whistle Blower Policy of the Company.

The recommendations of Audit Committee are duly approved and accepted by the Board.

The meetings of Audit Committee are also attended by the Wholetime Director ChiefFinancial Officer Statutory Auditors and Internal Auditors as special invitees. TheCompany Secretary acts as the Secretary to the Committee. The minutes of each AuditCommittee meeting are placed in the next meeting of the Board.

The Audit Committee met four times during the financial year ended 31st March 2017 onMay 28 2016; August 6 2016; November 5 2016 and February 4 2017.

NOMINATION AND REMUNERATION COMMITTEE

The role and principal terms of reference of the Nomination and Remuneration Committeein terms of Section 178 of the Companies Act 2013 and Regulation 19 of ListingRegulations are as follows:

• Formulation of the criteria for determining qualifications positive attributesand independence of a director and recommend to the board of directors a policy relatingto the remuneration of the directors key managerial personnel and other employees;

• Formulation of criteria for evaluation of performance of independent directorsand the board of directors;

• Devising a policy on diversity of board of directors;

• Identifying persons who are qualified to become directors and who may beappointed in senior management in accordance with the criteria laid down and recommend tothe board of directors their appointment and removal.

The Nomination and Remuneration Committee comprises Mr. Prashant Sekhar Panda Chairmanand Atul Chandra Varma Mr. Prabhat Agarwala Vijay Maheshwari and Mr. Bijay Murmuria asmembers of the Committee.

Performance evaluation criteria for independent Directors

Securities Exchange Board of India (SEBI) vide its Circular No.SEBI/HO/CFD/CMD/CIR/P/2017/004 dated January 5 2017 had issued a guidance note on BoardEvaluation which inter alia contains indicative criteria for evaluation of performance ofthe Board and its Directors.

The Nomination and Remuneration Committee had considered and adopted the indicativecriteria for evaluation of performance of the Board of Directors and the IndependentDirectors issued by Securities Exchange Board of India (SEBI) as aforesaid in terms ofthe requirements of the Companies Act 2013 and SEBI (Listing Obligation and DisclosureRequirements) Regulation 2015.

Pursuant to the adoption of the new criteria for evaluation of performance of the Boardof Directors and the Independent Directors the Committee carried out the process ofevaluation of the performance of every Director in accordance with its terms of referenceand the requirements of Companies Act 2013.

The performance of the Independent Directors is evaluated on the basis of the followingparameters:

General: (a) Qualifications (b) Experience (c) Knowledge and Competency (d)Fulfillment of functions (e) Ability to function as a team (f) Initiative (g)Availability and attendance (h) Commitment (i) Contribution (j) Integrity.

Additional criteria for Independent Director: (a) Independence and (b) Independentviews and judgement.

The Nomination and Remuneration Committee met on May 28 2016 and May 20 2017 for therelated years.

Board Membership Criteria

The Board of Directors are collectively responsible for selection of a member on theBoard. The Nomination and Remuneration Committee of the Company follows a defined criteriafor identifying screening recruiting and

recommending candidates for election as a Director on the Board. The criteria forappointment to the Board include:

• composition of the Board which is commensurate with the size of the Companyits portfolio geographical spread and its status as a listed company;

• desired age and diversity on the Board;

• size of the Board with optimal balance of skills and experience and balance ofExecutive and Non-Executive Directors consistent with the requirements of law;

• professional qualifications expertise and experience in specific area ofbusiness;

• balance of skills and expertise in view of the objectives and activities of theCompany;

• avoidance of any present or potential conflict of interest;

• availability of time and other commitments for proper performance of duties;

• personal characteristics being in line with the Company's values such asintegrity honesty transparency pioneering mindset.

Remuneration Policy

The Remuneration Policy of the Company is to provide market competitive total rewardopportunity that has a strong linkage to and reinforces the performance culture of theCompany. This philosophy is set forth into practice by policy governing the differentelements of total reward. The intent of the policy is to ensure that the principles ofreward philosophy are followed in entirety thereby facilitating the Company to recruitand retain the best talent. The ultimate objective is to gain competitive advantage bycreating a reward proposition that inspires employees to deliver Company's promise to itsclients and achieve superior operational results.

The guiding principles for Company's reward policies / practices are as follows:

1. Open Fair Consistent and Explainable: increase transparency and ensure fairnessand consistency in Reward framework.

2. Simplicity Speed and Accuracy: simplify reward plans and processes and deliver theinformation employees need quickly clearly and efficiently.

3. Business Results: Company's business results are the ultimate test of whether rewardsolutions are effective and sustainable.

The appointment of Wholetime Director Key Managerial Personnel and other senioremployees is by virtue of their employment with the Company as management employees andtherefore their terms of employment vis-a-vis salary variable pay service contract andnotice period are governed by the applicable policies at the relevant point in time. TheRemuneration Policy/system is reviewed and approved by the Nomination and RemunerationCommittee periodically taking into account external benchmarks within the context ofgroup and individual performance.

A fair portion of the reward is linked to Company's performance. This creates alignmentwith the strategy and business priorities to enhance shareholders value. Long termincentives seek to reward the eligible employees by aligning their deliverables tobusiness results.

Non-Executive Directors and Independent Directors are eligible for sitting fee of '5000/- for attending meetings of the Board or Committee.

The details of remuneration paid to Directors during the financial year 2016-17

Name of Directors Meetings Fees # (?) Guarantee

Commission*

(?)

Salary & Perks (?) Total

(?)

No. of Shares held as on 31-Mar-17
Mr. Ratan Lal Gaggar Chairman 15000 - - 15000 -
Dr. Basudeb Sen 15000 - - 15000 4000
Mr. Atul Chandra Varma 35000 - - 35000 -
Mr. Vijay Maheshwari 15000 125000 - 140000 1669220
Mr. Prashant Sekhar Panda 30000 - - 30000 -
Mr. Prabhat Agarwala 45000 - - 45000 2500
Mr. Anil Kumar Birla 5000 - - 5000 6000
Mr. Bijay Murmuria 50000 125000 - 175000 369920
Mr. Bhawani Sankar Rathi Wholetime Director - - 2522147 2522147 119270
Mrs. Garima Maheshwari 5000 - - 5000 25000
Total 215000 250000 2522147 2987147 2195910

# Sitting Fees for Board and Committee Meetings.

* Guarantee Commission paid for providing personal guarantee for credit facilitiesavailed by the Company.

STAKEHOLDERS RELATIONSHIP COMMITTEE

The Stakeholders' Relationship Committee is comprised of Mr. Prashant Sekhar PandaChairman Mr. Anil Kumar Birla and Mr. Bijay Murmuria as members of the Committee. TheCommittee met on May 28 2016.

Details of Shareholders' / Investors' Complaints

Mr. Deb Kumar Sett Company Secretary is the Compliance Officer for resolution ofShareholders' / Investors' Complaints. Details of Complaints received redressed andpending during the financial year ended 31st March 2017:

Pending at the beginning of the year Received during the year Redressed/ Replied during the year Pending at the year end
Nil Nil Nil Nil

Other functional Committee

Apart from the above statutory Committees the Board of Directors has constituted thefollowing Functional Committee to raise the level of governance as also to meet thespecific business needs.

Management Committee

The Management Committee has been set up to oversee routine operations that arise inthe normal course of the business such as decision on banking relations delegation ofoperational powers appointment of nominees under statutes etc. The Committee comprisesthree Directors of the Board (Mr. Vijay Maheshwari Mr. Anil Kumar Birla and Mr. BijayMurmuria). The Committee reports to the Board and the minutes of these meetings are placedbefore the Board for information.

Attendance of Directors at Meetings of Board Committee and last AGM

The following table shows attendance of Directors at the Board and statutory Committeemeeting(s) for the year ended 31st March 2017. Attendance is presented as number ofmeeting(s) attended out of the number of meeting(s) required to be attended.

Name Board

Meeting

Audit

Committee

Nomination and Remuneration Committee Stakeholders

Relationship

Committee

Last AGM held on 17-Sep-16
Mr. Ratan Lal Gaggar 3 of 4# - - - Y#
Dr. Basudeb Sen 3 of 4 - - - Y
Mr. Atul Chandra Varma 3 of 4 3 of 4 1 of 1 - Y
Mr. Vijay Maheshwari 3 of 4 - 0 of 1 - Y
Mr. Prashant Sekhar Panda 2 of 4 2 of 4# 1 of 1# 1 of 1# N
Mr. Prabhat Agarwala 4 of 4 4 of 4 1 of 1 - N
Mr. Anil Kumar Birla 1 of 4 - - 0 of 1 Y
Mr. Bhawani Sankar Rathi 4 of 4 - - - Y
Mr. Bijay Murmuria 4 of 4 4 of 4 1 of 1 1 of 1 Y
Mrs. Garima Maheshwari 1 of 4 - - - Y

# Chairman

Governance of Subsidiary Company

The minutes of the Board Meetings of the subsidiary company along with the details ofsignificant transactions and arrangements entered into by the Subsidiary Company if anyare shared with the Board of Directors on a quarterly basis. The financial statements ofthe subsidiary company are presented to the Audit Committee as well as the Board. TheCompany does not have a material subsidiary.

AFFIRMATION AND DISCLOSURE

Code of Conduct under SEBI (Prohibition of Insider Trading) Regulations 2015

In accordance with the requirements of the Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations 2015 the Company has instituted a Code ofConduct to regulate monitor and report trading by its directors employees and otherconnected persons.

Code of Business Conduct and Ethics

The Code of Business Conduct and Ethics for Directors and employees of the company aimsat ensuring consistent standards of conduct and ethical business practices across theconstituents of the Company. This Code is reviewed from time to time and the latest Codeis available on the website of the Company

All the Directors and senior management personnel have affirmed their compliance withthe Code of Conduct as on 31st March 2017 and a declaration to that effect signed by theWholetime Director and Chief Financial Officer is attached and forms part of this Report.The Company is not having Chief Executive Officer.

The Directors and senior management personnel have made disclosure to the Board ofDirectors relating to transactions with potential conflict of interest with the Companyif any. There were no material financial or commercial transaction between the Companyand Directors and senior management personnel that may have a potential conflict with theinterest of the Company at large.

All details relating to financial and commercial transactions where Directors may havea pecuniary interest are provided to the Board and the interested Directors neitherparticipate in the discussion nor vote on such matters.

DISCLOSURE ON WEBSITE

Following information has been disseminated on the website of the Company

Particulars

1. Details of business of the Company

2. Terms and conditions of appointment of Independent Directors
3. Composition of various Committees of Board of Directors

4. Code of Conduct for Board of Directors and Senior Management Personnel

5. Details of establishment of Vigil Mechanism/ Whistle Blower Policy
6. Policy on Dealing with Related Party Transactions
7. Policy for Determining ‘Material' Subsidiaries
8. Details of Familiarization Programmes imparted to Independent Directors
9. Status of Unpaid/Unclaimed Dividends
10. Details of Unclaimed Shares

PRESENTATION

No presentation was made to Institutional Investors or to the analysts during the yearunder review.

DISCLOSURE OF PENDING CASES / INSTANCES OF NON-COMPLIANCE

There were no non-compliances by the Company and no instances of penalties andstrictures imposed on the Company by the Stock Exchanges or SEBI or any other statutoryauthority on any matter related to the capital market during the last three years.

COMMODITY PRICE RISK/FOREIGN EXCHANGE RISK AND HEDGING ACTIVITIES

The Company's Subsidiary (SFSL Commodity Trading Pvt. Ltd.) is registered with the SEBIas a Trading Member of Multi Commodity Exchange of India Ltd. However in view ofvolatility in the market it has kept its exposure in commodity market to minimum and thesame is not posing any substantial risk neither to the Company nor to its Subsidiary.

Compliance of Listing Regulations

The Company is in compliance with requirements specified in Regulations 17 to 27 andclauses (b) to (i) of sub regulation (2) of Regulation 46 of the Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015.

The company has also complied with the discretionary requirements such as reporting ofInternal Auditors directly to the Audit Committee.

SECRETARIAL AUDIT REPORT

The Company has undertaken Secretarial Audit for the financial year 2016-17 whichinter alia includes audit of compliance with the Companies Act 2013 and the Rules madeunder the Act Listing Regulations and applicable Regulations prescribed by the Securitiesand Exchange Board of India and Foreign Exchange Management Act 1999 and SecretarialStandards issued by the Institute of the Company Secretaries of India. The SecretarialAudit Report forms part of this Annual Report.

SHAREHOLDER INFORMATION General Body Meetings

Details of last three Annual General Meetings and the summary of Special Resolutionspassed therein are as under:

Financial Year ended Date and time Venue Special Resolutions Passed
March 31 2014 March 31 2015 March 31 2016 September 13 2014 at 10:30 AM

Merchants' Chamber of Commerce & Industry 15B Hemanta Basu Sarani Kolkata - 700001.

Leasing of office space u/s. 188(1)(c) of the Companies Act 2013
September 12 2015 at 10.30 a.m. No special resolution has been passed
September 17 2016 at 10.30 a.m. No special resolution has been passed

No special resolution was passed by the Company last year through Postal Ballot. Nospecial resolution is proposed to be conducted through Postal Ballot in the ensuing AnnualGeneral Meeting.

Annual General Meeting for the Financial Year 2016-17

Date : Saturday 23rd September 2017
Venue : Merchants' Chamber of Commerce & Industry 15B Hemanta Basu Sarani Kolkata - 700001.
Time : 10.30 a.m.
Book Closure Dates for Dividend : Tuesday September 19 2017 to Saturday September 23 2017 (both days inclusive)
Last Date of receipt of Proxy Forms : Thursday September 21 2017 before 10.30 a.m. at Registered Office of the Company

Calendar for financial year ending 31st March 2018

The tentative dates of meeting of Board of Directors for consideration of quarterlyfinancial results for the financial year ending 31st March 2018 are as follows:

First Quarter Results : 12th August 2017
Second Quarter and Half yearly Results : 11th November 2017
Third Quarter Results : 10th February 2018
Fourth Quarter and Annual Results : 26th May 2018

Dividend

The Board of Directors at their meeting held on 20th May 2017 recommended a Dividendof ' 1 per equity share of ' 10/- each for the Financial Year ended 31st March 2017.Dividend if approved by Members will be paid on or after Thursday 28th September 2017.

Unclaimed Dividends

During the year under review the Company has credited ' 148744/- to the InvestorEducation and Protection Fund (IEPF) pursuant to Section 124(5) of the companies Act 2013and Rules made thereunder. The Company has uploaded the details of unpaid and unclaimedamounts lying with the Company as on 17th September 2016 (date of last Annual GeneralMeeting) on the Company's website unpaidUnclaimedDividend . asp and on the website ofthe Ministry of Corporate Affairs.

Transfer of Underlying Shares to Investor Education and Protection Fund (IEPF)

Pursuant to section 124(6) of the Companies Act 2013 read with Investor Education andProtection Fund Authority (Accounting Audit Transfer and Refund) Rules 2016 asamended all shares in respect of which dividend has not been paid or claimed for sevenconsecutive years or more are required to be transferred by the Company in the name ofIEPF. The Company has sent individual notices to the latest available addresses of theshareholders whose dividends are lying unpaid/unclaimed for the financial year 2008-09along with subsequent 7 (seven) consecutive year's dividend advising them to claim thedividends on or before the prescribed date. It has also published a notice in newspapersinviting the shareholders' attention as required. Shareholders who have not claimed theirdividends since 2008-09 can write to the Company's Registrar & Share Transfer Agent(STA). The Company is compliant of the statutory guidelines issued from time to time bythe Ministry of Corporate Affairs. Details of such Unclaimed Shares are available at theCompany's website. The concerned shareholders should contact the said STA for guidance inthis connection.

Director's Re-appointment Particulars

Resume and other information regarding the Director being re-appointed as requiredunder Regulation 36(3) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and Clause 1.2.5 of Secretarial Standard (SS-2) have been given in theNotice of the Annual General Meeting annexed to this Annual Report.

Related Party Transactions

Transactions with the Related Parties have been disclosed in Note No. 24 of the Notesto Financial Statements in the Annual Report for the year under review. There was nomaterially significant related party transactions that may have potential conflict withthe interests of the Company at large. The Company's Policy on dealing with related partytransactions as approved by the Board is available on the website of the Company at thelink:

Whistle Blower Policy

The Company has formulated Whistle Blower Policy / vigil mechanism for Directors andemployees to report to the management about the unethical behaviour fraud or violation ofCompany's Code of Conduct. The mechanism provides for adequate safeguards againstvictimisation of employees and Directors who use such mechanism and makes provision fordirect access to the Chairman of the Audit Committee in exceptional cases. None of thepersonnel of the Company has been denied access to the Audit Committee. Company's Policythereon is available on the Company's Website at the weblink:

Internal Controls and Risk Management

The Company is having a well-defined Internal Control System supported by InternalCompliance Structure. Quarterly performance and status of statutory compliance of all thesegments are placed before the Audit Committee as well as the Board of Directors of theCompany (Merchant Banking Stock Broking Depository Participant and Portfolio ManagementService).

The Company has effective systems for internal audit undertaken by external auditfirms. The Internal Audit covers all the segments of the Company including theIntermediaries of the SEBI.

The Company's risk assessment and mitigation system commensurate with its size andnature of activities. Detailed Report on status of risks faced by the Company and efficacyof the mitigation system are quarterly reviewed by the Audit Committee as well as Board ofDirectors of the Company.

The Company's internal financial control framework is commensurate with the size andoperations of the business and is in line with requirements of the Companies Act 2013.The Company's internal financial controls framework is based on the ‘three lines ofdefense model'. The Company has laid down standard operating procedures and policies toguide the operations of the business. Vertical/Unit heads are responsible to ensurecompliance with the policies and procedures laid down by the management. Continuousinternal monitoring mechanisms ensure timely identification of risks and issues. Themanagement Statutory and Internal Auditors undertake rigorous monitoring of the controlenvironment of the Company.

All the mandatory requirements have been appropriately complied with and thenon-mandatory requirements are dealt with at the end of this Report.

Disclosure of Accounting Treatment

In the preparation of the financial statements the Company has followed the AccountingStandards referred to in Section 133 of the Companies Act 2013. The significantaccounting policies which are consistently applied are set out in the Notes to theFinancial Statements. There is no deviation therein during the Financial Year underconsideration.

MEANS OF COMMUNICATION

Quarterly Results and publication thereof in newspapers

Quarterly half-yearly and annual results are published in prominent dailies asFinancial Express (English) and Akdin (Bengali) newspapers in the form prescribed byRegulation 33 and 47 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.

Display of Official news and presentation made to the Shareholders/InstitutionalInvestors/ Analysts

Press releases and Information Updates as and when made are displayed on the Company'swebsite and also sent to the Stock Exchanges to enable them to put the same on their ownwebsites.

Listing Details

Name and Address of Stock Exchange Stock Code
BSE Limited (BSE)

Floor 25 Phiroze Jeejeebhoy Towers Dalal Street Mumbai - 400 001.

530419
The Calcutta Stock Exchange Ltd. (CSE)
7 Lyons Range Kolkata - 700 001. 029093
ISIN INE886B01012

The listing fee for the financial year 2016-17 has been paid to the above StockExchanges. Stock Price Data:

Period

The Calcutta Stock Exchange Ltd.

BSE Ltd.

High Low High Low Closing Sensex (Closing)
April 2016 - - 16.00 11.20 13.98 25606.62
May 2016 - - 17.50 12.14 13.33 26667.96
June 2016 - - 15.99 10.50 13.35 26999.72
July 2016 - - 17.15 13.10 14.96 28051.86
August 2016 - - 17.48 13.28 13.88 28452.17
September 2016 - - 17.70 13.50 14.00 27865.96
October 2016 - - 18.29 14.00 16.09 27930.21
November 2016 - - 19.00 15.00 17.25 26652.81
December 2016 - - 20.25 15.60 16.60 26626.46
January 2017 - - 19.95 16.00 17.05 27655.96
February 2017 - - 19.95 14.30 15.35 28743.32
March 2017 - - 17.50 13.20 15.35 29620.50

Share Transfer System

The requests for transfer of shares held in physical mode should be lodged at theaforesaid office of the Company's Registrar & Share T ransfer Agents or at theRegistered Office of the Company. The Board of Directors has delegated the powers of sharetransfer transmission sub-division consolidation and also issue of Duplicate ShareCertificate to the Management Committee (MC) in order to expedite transfer transmissionetc. in the physical form. Share Transfers are registered within statutory time limit of15 days if the transfer documents are found technically in order and complete in allrespect.

Address for Correspondence

All shareholders' correspondence should be forwarded to M/s. Maheshwari Datamatics Pvt.Ltd. the Registrar and T ransfer Agent of the Company or to the Investor ServiceDepartment at the Registered Office of the Company at the addresses mentioned below

Maheshwari Datamatics Pvt. Ltd. Investor Service Department Compliance Officer
[Unit: Sumedha Fiscal Services Ltd.] Sumedha Fiscal Services Ltd. Mr. Deb Kumar Sett
23 R. N. Mukherjee Road 5th Floor 6A Geetanjali 8B Middleton Street Company Secretary &
Kolkata - 700001. Kolkata - 700071. Compliance Officer
Phone: (033) 2243-5029; 2248-2248; Phone: (033) 2229-8936/3237 E-mail - compliance@
2231-6839 Fax: 033)2229-4140 sumedhafiscal.com
Fax: (033) 2248-4787 E-mail: mdpldc@yahoo.com E-mail: investors@sumedhafiscal.com Phone: 2229-8936/3237

Distribution of Shareholding as on March 31 2017:

a) Shareholding Pattern as on 31st March 2017

Category No. of Shares % of holding Held in Demat Form % in Demat Form
Promoters (Individual & Bodies Corporate) 3957709 49.568 3957709 49.568
Mutual Funds/Government(s) 7300 0.091 - -
Bodies Corporate (Non-promoter) 1556813 19.498 1532013 19.188
Indian Public (Individual) 2246862 28.140 2128042 26.652
NRIs/OCBs 54816 0.687 50916 0.638
Clearing Member 52424 0.657 52424 0.657
Investor Education and Protection Fund Authority 108500 1.359 - -
Total 7984424 100.000 7721104 96.703

b) According to number of Shares held

No. of Shares No. of % of Shares % of Sl. No. Date of Allotment No. of Shares
Shareholders Shareholders held Shareholding 1. 28-08-89 200
1-500 1660 73.23 284391 3.56 2.

26-08-91

01-03-93

25-03-94

03-11-94

30000

237950

86500

690000

501-1000 236 10.41 193541 2.43 3.

4

1001-2000 147 6.48 231668 2.90 5.
2001-3000 58 2.56 148019 1.85 6. 12-05-95 3959950
3001-4000 30 1.32 106466 1.33 7

27-08-99

24-01-09

30-03-10

22-01-11

1638340

125000

56600

24400

4001-5000 27 1.19 127105 1.60 8

9

5001-10000 51 2.25 371532 4.65 10
10001 and above 58 2.56 6521702 81.68 11 30-03-12 1135484
2267 100.00 7984424 100.00 Total 7984424

d) Bifurcation of shares held in physical and demat form as on 31st March 2017

Particulars No. of Folios No. of Shares %
Physical Segment 255 263320 3.30
Demat Segment
NSDL (A) 1234 6707628 84.81
CDSL (B) 778 1013476 12.69
TOTAL 2267 7984424 100.00

CORPORATE GOVERNANCE COMPLIANCE CERTIFICATE

To the Members

SUMEDHA FISCAL SERVICES LIMITED

We have examined all the relevant records of Sumedha Fiscal Services Limited ("theCompany") for the purpose of certifying compliance of the conditions of CorporateGovernance as per Para C of Schedule V of the Securities Exchange Board of India (ListingObligations and Disclosure Requirement) Regulation 2015 read with Regulation 34(2) of theListing Regulations (hereinafter collectively referred to as the Listing Regulations) forthe Financial Yeai ended on March 31 2017. We have obtained all the information andexplanations which best to our knowledge anc belief were necessary for the purpose ofcertification.

The compliance of conditions of Corporate Governance is the responsibility of theManagement. Our examination was limited to a review of the procedures and implementationsthereof adopted by the Company for ensuring compliance with the conditions of theCorporate Governance as stipulated in the said Clause/Regulation. It is neither an auditnor an expression of opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanationsgiven to us and based on the representations made by the Directors and the Management wecertify that the Company has complied with al the mandatory conditions of CorporateGovernance as stipulated in the above mentioned Listing Agreement/Listing Regulations asapplicable.

We further state that such Certificate is neither an assurance as to the futureviability of the Company nor of the efficiency or effectiveness with which the Managementhas conducted the affairs of the Company.

For ARSK & ASSOCIATES

Chartered Accountants Firms' Registration No. 315082E

CA. S. K. Kabra

Partner

Membership No. : 052205

Place: Kolkata Date: 20th May 2017