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Networth Stock Broking Directors Report, Networth Stock Reports by Directors
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Networth Stock Broking
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Directors Report Year End : Mar '14    Mar 13
Dear Members,
 
 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,
 Maharashtra, Mumbai.
 
 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)
 each.
 
 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
 MPFL.
 
 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/-.
 
 FINANCIAL HIGHLIGHTS:
 
 The financial highlights after giving effect of the amalgamation, as
 aforesaid, are as follows:
 
                                                          (Rs. in Lacs)
 
 Particulars                             Year ended on    Year ended on
                                            31/03/2014       31/03/2013
 
 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
 
 Profit/(Loss) before
 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
 basis.
 
 FINANCIAL PERFORMANCE:
 
 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).
 
 DIVIDEND:
 
 In view of loss during the year, your Directors do not recommend any
 dividend for the year under review.
 
 DIRECTORS:
 
 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
 Company.
 
 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
 Meeting.
 
 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
 necessary;
 
 (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
 date.
 
 (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
 Concern'' basis.
 
 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
 to others.
 
 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.
 
 PUBLIC DEPOSITS:
 
 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.
 
 STATUTORY AUDITORS:
 
 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
 Company.
 
 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
 2018-19.
 
 AUDITORS'' REMARKS:
 
 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.
 
 STOCK EXCHANGE:
 
 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
 Exchange.
 
 CORPORATE GOVERNANCE:
 
 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.
 
 DEPOSITORY SYSTEM:
 
 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
 as aforesaid.
 
 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.
 
 ACKNOWLEDGEMENT:
 
 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
 
 Place: Mumbai
 Date: 1st December, 2014                                Suresh P. Jain
                                                               Chairman
Source : Dion Global Solutions Limited
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