To the Members of Essar Securities Limited,
The Directors have pleasure in presenting the Seventh Annual Report
and Audited Accounts of the Company for the financial year ended March
1. FINANCIAL RESULTS, BUSINESS AND MANAGEMENT''S DISCUSSION &
(Rs. In Lakhs)
Particulars For the For the
year ended year ended
on March on March
Income - 3339.85
Less: Expenditure 18.62 39.69
Profit Before Tax (18.62) 3300.16
Less: Provision for taxation 4.85 692.03
Profit After Tax (23.47) 2608.13
Dividend declared - (214.32)
Corporate dividend tax - (34.77)
Transfer to General Reserve - (131.00)
Balance brought forward from 2254.32 26.28
Balance carried forward to 2230.85 2254.32
During the year under review, the loss after tax was Rs. 23.47 Lakh
against the profit after tax of Rs. 26.08 Crore for the previous year.
The loss was mainly due to Administrative Expenses.
The directors do not recommend any dividend due to the losses incurred
during the year.
Threats, Risks and Concerns
As the Company has major equity investment in Essar Steel India
Limited, a company engaged in Steel Business, its operations would also
have a bearing on the performance of the Company.
Internal Control Systems and Internal Audit
Your Company has in-built internal control systems commensurate with
the size and nature of operations of the Company. The financial
statements would be reviewed periodically by the management. The
Company has an internal audit system whereby deviations, if any, can be
brought to the notice of the management quickly and remedial actions
can be initiated immediately.
Mr. V. G. Raghavan and Mr. S. M. Lodha continue to be director of your
Company. Mr. Dhanpat Singh Nahata, Mr. Neeraj Gupta and Mr. N. B. Vyas
were inducted on the Board as Additional Director at the Meeting of
Board of Directors held on February 14, 2012, May 14, 2012 and August
24, 2012 respectively. Your company has received a letter from
shareholders'' nominating them for the post of Director of the Company
liable to retire by rotation. Mr. V. G. Raghavan retires by rotation at
the ensuing Annual General Meeting (AGM) and being eligible offers
himself for re-appointment.
Mr. Vikas Saraf resigned from the directorship of the Company w.e.f.
April 28, 2012. The Board wishes to place on record their sincere
appreciation for the valuable sen/ices rendered by Mr. Vikash Saraf
during their tenure as a Director of the Company. Mr. Girish Sathe
also resigned as Manager of the Company within the meaning of section
2(24) of the Companies Act, 1956 as well as from the post of Company
Secretary w.e.f. May 14, 2012.
Mr. Ashish Vyas, Company Secretary was appointed as Manager of the
Company within the meaning of section 2(24) of the Companies Act in
accordance with section 269 read with Schedule XIII of the Companies
Act. Necessary resolution for approval of shareholders with respect to
his appointment as Manager also forms part of the notice of the
3. DIRECTORS'' RESPONSIBILITY STATEMENT:
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, it is hereby confirmed:
(i) that in the preparation of the annual accounts for the financial
year ended 31st March, 2012, the applicable accounting standards had
been followed along with proper explanation relating to material
departures, wherever applicable;
(ii) that the directors had selected such accounting policies and
applied them consistently and made judgments and estimates that were
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit of the Company for the year under review;
(iii) that the directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
(iv) that the directors had prepared the accounts for the financial
year ended 31 st March, 2012 on a going concern basis.
4. PUBLIC DEPOSIT:
The Company has neither invited nor accepted any deposits from the
public during the year. There are no unclaimed deposit(s) lying with
the Company as on March 31, 2012.
M/s. Nisar & Kumar, Chartered Accountants, Statutory Auditors of the
Company, hold office till the conclusion of the ensuing Annual General
Meeting of the Company. The Company has received confirmation to the
effect that their appointment, if made, would be within the limits
prescribed under Section 224(1 B) of the Companies Act, 1956.
Accordingly, the members'' approval is being sought to their
appointment as the Auditors of the Company at the ensuing Annual
6. PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY,
ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
Considering the nature of activities of your Company, the information
required under Section 217(1)(e) of the Companies Act, 1956 read with
Companies (Disclosure of Particulars in the Report of Board of
Directors), Rules 1988 relating to Energy Conservation, Technology
Absorption is not applicable. The Company had no foreign exchange
earnings or outgo during the period under review.
7. PARTICULARS OF EMPLOYEES:
The disclosure as required under Section 217(2A) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules, 1975 as
amended, is not required as there are no employees covered by it.
8. HOLDING COMPANY:
Essar Capital Limited continues to be holding company of your Company.
Essar Capital Holdings (India) Limited continues to be the ultimate
9. CORPORATE GOVERNANCE REPORT:
The Company is committed to maintain the highest standard of Corporate
Governance and comply to the Corporate Governance requirements as
required under the Listing Agreement entered with the Stock Exchange.
The disclosures as required in Clause 49 of the Listing Agreement have
been furnished in the Annexure to the Directors'' Report under the head
Corporate Governance. The requisite Certificate from the
Statutory Auditors of the Company confirming the compliances with the
conditions of the Corporate Governance as stipulated in Clause 49 of
the Listing Agreement entered with the Stock Exchanges, is attached and
forming part of this Annual Report.
10. CAUTIONARY STATEMENT
Estimation & expectation made in the report may differ from actual
performance due to various economic conditions, Government policies and
other related factors.
Your directors also wish to place on record their gratitude for the
co-operation and assistance received from banks, stock exchange,
shareholders and various departments of Central and State Governments
and thank them for their continued co- operation and support.
For and on behalf of the Board
V. G. Raghavan Dhanpat Singh Nahata
Date: August 24, 2012