The Directors present the 21st Annual Report together with Financial
Statements of the Company for the financial year ended 31st March 2014.
SCHEME OF AMALGAMATION:
The Board of Directors of your Company at its meeting held on 9th
April, 2011 had approved the Scheme of Amalgamation (the Scheme) under
Section 391 to 394 read with Section 78 and Section 100 to 103 of the
Companies Act, 1956 of Monarch Research and Brokerage Private Limited
(''MRBPL'') and Monarch Project and Fimarkets Limited (''MPFL'') with the
Company with effect from appointed date 1st April, 2010. The same was
approved by the shareholders of the Company at the Court Convened
Meeting held on 9th April, 2012.
Pursuant to the said Scheme of Amalgamation as approved by the Hon''ble
High Court of Gujarat vide its order dated 3rd May, 2013 and by the
Hon''ble High Court of Bombay vide its order dated 7th August, 2014,
MRBPL and MPFL have been amalgamated with your Company and all assets
and liabilities are transferred to and vested in the Company with
effect from appointed date i.e. 1st April, 2010.
The certified copies of the said orders have been filed with the
Registrar of Companies, Gujarat and Maharashtra, Mumbai on 25th July,
2013 and 15th October, 2014 respectively. Accordingly, the Scheme has
become effective with effect from 15th October, 2014, being the later
of the date on which the certified copy of the High Court orders
sanctioning the Scheme are filed with the Registrar of Companies,
According to clause 11 of the Scheme of Amalgamation, the Authorized
Share Capital of the Company post amalgamation has been increased from
Rs. 17,50,00,000/- (Rupees Seventeen Crores Fifty Lacs) divided into
1,25,00,000 (One Crore Twenty Five Lacs) Equity shares of Rs. 10/-
(Rupees Ten only) each and 5,00,000 (Five Lacs) 6% Cumulative
Redeemable Preference Shares of Rs. 100/-(Rupees Hundred only) to Rs.
41,50,00,000/- (Rupees Forty One Crores Fifty Lacs only), divided into
3,05,00,000 (Three Crores Five Lacs only) Equity shares of Rs. 10
(Rupees Ten) each and 5,00,000 (Five Lacs only) 6% Cumulative
Redeemable Preference Shares of Rs. 100/- (Rupees Hundred only) and
60,00,000 (Sixty Lacs) Preference Shares of Rs. 10/- (Rupees Ten Only)
Pursuant to the said Scheme, the Board of Directors of the Company at
its meeting held on 27th October, 2014 has issued and allotted
1,90,80,000 Equity shares of Rs. 10/- each to the shareholders of
transferor companies in the following ratio:
* In case of MRBPL, in the ratio of 100 (One Hundred) equity share of
face value of Rs. 10/- (Rupees Ten Only) each fully paid up in the
Transferee Company for every 100 (one Hundred) Equity Share of the face
value of Rs. 10/- (Rupees Ten only) each fully paid up in MRBPL.
* In case of MPFL in the ratio of 201 (Two Hundred and One) equity
share of face value of Rs. 10/- (Rupees Ten Only) each fully paid up in
the Transferee Company for every 100 (One Hundred )Equity Share of the
face value of Rs. 10/- (Rupees Ten Only) each fully paid up in the
Consequent to the said allotment, the paid-up share capital of the
Company has increased from Rs. 11,23,16,000/- to Rs. 30,31,16,000/-.
The financial highlights after giving effect of the amalgamation, as
aforesaid, are as follows:
(Rs. in Lacs)
Particulars Year ended on Year ended on
Total Revenue 3663.73 2067.81
Profit/(Loss) before Finance Cost,
Depreciation & Amortization expenses and Tax 845.25 348.12
Less: Finance Cost 565.43 154.77
Depreciation and Amortization expenses 304.66 161.29
exceptional/Extraordinary items and Tax (24.84) 32.06
Add: Exceptional/Extraordinary items and
prior period adjustments (180.02) (2.98)
Profit/(Loss) before Tax (204.85) 29.08
Less: Tax Expense (138.36) (48.84)
Profit/(Loss) after Tax (66.49) 77.92
The figures for the year ended March 31, 2014 are not comparable with
the figures of the previous year which were prepared on standalone
The total income of the Company after giving effect of the amalgamation
for the year under review stood at Rs. 3663.73 Lacs (previous year Rs.
2067.81 Lacs). During the year the Company incurred net loss of Rs.
66.49 Lacs (previous year profit of Rs. 77.92 Lacs).
In view of loss during the year, your Directors do not recommend any
dividend for the year under review.
Mr. Vaibhav Shah was appointed as an Additional and also Managing
Director of the Company for a period of 1 (One) year w.e.f. 1st
December, 2014, subject to approval of the shareholders of the Company.
He holds office upto the date of ensuing Annual General Meeting.
Mr. Mayukh Pandya and Mr. Shailesh Desai were appointed as Additional
(Independent) Directors of the Company for a period of 5 years w.e.f.
1st December 2014, subject to approval of the shareholders of the
Company. In terms of provisions of Section 161 of the Companies Act,
2013, Mr. Mayukh Pandya and Mr. Shailesh Desai hold office as such up
to the date of ensuing Annual General Meeting of the Company.
The Company has received notices from Mr. Vaibhav Shah, Mr. Mayukh
Pandya and Mr. Shailesh Desai under Section 160 of the Companies Act,
2013 together with necessary deposit offering themselves for
appointment as Directors of the Company. The Company has received
declarations from Mr. Mayukh Pandya and Mr. Shailesh Desai confirming
that they meet the criteria of independence as prescribed under
sub-section (6) of Section 149 of the Companies Act, 2013 and Clause 49
of the Listing Agreement entered with the Stock Exchange. Your Board
recommends for their appointment as Directors of the Company.
In accordance with the provision of Section 152 of the Companies Act,
2013 read with Companies (Management & Administration) Rules, 2014 and
the Articles of Association of the Company, Mr. Suresh P. Jain,
Chairman of the Company, retires by rotation and being eligible, offers
himself for re-appointment.
During the period:
1. Mr. Manish Ajmera, Executive Director & Chief Financial Officer
(CFO) of the Company resigned from the Directorship of the Company
w.e.f. closing hours of 23rd June, 2014.
2. Mr. Randhir Singh Sisodiya was appointed as Additional (Executive)
Director of the Company w.e.f 23rd June, 2014 for a period of 1(One)
year. Mr. Randhir Singh Sisodiya, Executive Director, Mr. Praveen
Toshniwal and Mr. Sanjay Motta, Independent Directors of the Company
resigned from Directorships of the Company w.e.f. closing hours of 1st
December, 2014. The Board places on record its appreciation for their
valuable contribution made during their tenure as Directors of the
Brief resume of the Directors proposed to be appointed/re-appointed as
stipulated under Clause 49 of the Listing Agreement entered with the
Stock Exchange are given in the Notice convening 21st Annual General
DIRECTORS'' RESPONSIBILITY STATEMENT:
In accordance with the provisions of Section 217 (2AA) of the Companies
Act, 1956, the Board of Directors of the Company hereby confirms that:
(i) The applicable Accounting Standards have been followed and proper
explanations relating to material departures have been given wherever
(ii) The Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reason-
able 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 ended 31st
March, 2014 and of the loss of the Company for the year ended on that
(iii) The Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities; and
(iv) The Directors have prepared the Annual Accounts on a ''Going
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS:
Consequent to the merger of MRBPL and MPFL with the Company, MPFL''s
subsidiary company viz. Monarch Insurance Broking Private Limited has
become subsidiary of the Company. Accordingly, the Company had 5
subsidiaries as on March 31, 2014, namely:
1. Networth Commodities & Investments Limited (NCIL),
2. Networth Wealth Solutions Limited (NWSL),
3. Networth Insurance Broking Private Limited (NIBPL)
4. Ravisha Financial Services Private Limited (RFSL) and
5. Monarch Insurance Broking Private Limited (MIBPL)
During the period under review, Networth Softech Limited (NSL) ceased
to be subsidiary of the Company upon allotment of new shares by the NSL
The Ministry of Corporate Affairs (MCA) vide General Circular No.2/2011
No. 51/12/2007-CL-III dated 8th February 2011 read with General
Circular No.3/2011 No. 5/12/2007-CL-III dated 21st February 2011 has
granted a general exemption from attaching the Balance Sheet of
subsidiary compa- nies with holding company''s Balance Sheet, if the
holding Company presents in its Annual Report Consolidated Financial
Statements duly audited by its Statutory Auditors. The Company is
publishing Consolidated Financial Statements in the Annual Report and
accordingly the Company is not attaching the Balance Sheets of the
subsidiary companies with its Balance Sheet. Further, as required under
the said circular, a statement of financial information of the
subsidiary companies viz. Networth Commodities & Investments Limited
(NCIL), Networth Wealth Solutions Limited (NWSL), Networth Insurance
Broking Private Limited (NIBPL), Ravisha Financial Services Private
Limited (RFSL) and Monarch Insurance Broking Private Limited (MIBPL) is
given in Annexure attached to this report.
The Annual Accounts of the above referred subsidiary companies shall be
made available to the shareholders of the Company on request and will
also be kept open for inspection at the Registered Office of the
Company and of the subsidiary companies during the office hours on all
working days and during the Annual General Meeting.
During the year under review, the Company has not accepted or renewed
any public deposits within the meaning of Section 58A and 58AA of the
Companies Act, 1956.
M/s. Dileep and Prithvi, Chartered Accountants (having FRN: 122290W),
Mumbai, the Statutory Auditors of your Company hold office as such upto
the conclusion of the ensuing Annual General Meeting and have expressed
their unwillingness to continue to act as the Statutory Auditors of the
The Company has received a special notice as required under Section 140
of the Companies Act 2013, proposing the appointment of M/s. Yogesh
Thakker & Co., Chartered Accountants, Mumbai (FRN: 111763W) as
Statutory Auditors of the Company. The Company has received a letter
from M/s. Yogesh Thakker & Co., Chartered Accountants confirming their
willingness to act as Statutory Auditors of the Company, if appointed.
The Company has also received a certificate from them to the effect
that their appointment, if made, would be in compliance with the
conditions as prescribed under Section 139 of the Companies Act, 2013
and they satisfy the criteria as provided under Section 141 of the Act.
Your Directors recommend the appointment of M/s. Yogesh Thakker & Co.,
Chartered Accountants, Mumbai as Statutory Auditors of the Company to
hold office from the conclusion of the 21st Annual General Meeting upto
the conclusion of 26th Annual General Meeting of the Company and to
audit financial statements for the financial years from 2014-15 to
The Auditors remarks on the Emphasis of Matter on event occurring after
the Balance Sheet date given in Auditors'' Report and remarks at
paragraph 9 (a) (i) of the Annexure to Auditors'' Report are
self-explanatory and do not require further comments.
The Equity Shares of the Company are listed at BSE Limited. The Company
has paid the Annual listing fees for the year 2014-15 to the said Stock
As required under Clause 49 of the Listing Agreement entered into with
BSE Limited, Management Discussion and Analysis Report and Corporate
Governance Report are annexed herewith and form part of this Report.
As the Members are aware, your Company''s shares are tradable
compulsorily in electronic form and your Company has established
connectivity with both the depositories i.e. National Securities
Depository Limited (NSDL) and Central Depository Services (India)
Limited (CDSL). In view of the numerous advantages offered by the
Depository system, members are requested to avail the facility of
dematerialization of the Company''s shares on either of the Depositories
INFORMATION UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:
The Company has constituted an Internal Compliant Committee under
Section 4 of the Sexual Harassment of women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013. During the year, no complaint was
made before the Committee.
PARTICULARS OF EMPLOYEES:
During the year under review, no employee was in receipt of
remuneration exceeding the limits as prescribed under the provisions of
Section 217(2A) of the Companies Act, 1956 read with Companies
(Particulars of Employee) Rules, 1975, as amended, hence no such
particulars are furnished.
PARTICULARS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND
FOREIGN EXCHANGE EARNINGS AND OUTGO:
A) Conservation of Energy
Considering the nature of business activities carried out by the
Company, your directors have nothing to report with regard to
conservation of energy as required under Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988.
B) Technology absorption, research and development
The management keeps itself abreast of the technological advancements
in the industry and has adopted the state of the art transaction,
billing and accounting systems and also risk management solutions.
Your Directors wish to place on record their gratitude and deep
appreciation for the continued support and co-operation received by the
Company from the shareholders, company''s clients, suppliers, bankers
and employees and look forward for their continued support in the
future as well.
For and on behalf of the Board of Directors
Date: 1st December, 2014 Suresh P. Jain