The Directors takes pleasure in presenting the Twenty-Fifth Annual Report of the operations and business of your Company together with the Audited Statement of Accounts for the year ended 31st March, 2018.
1. FINANCIAL SUMMARY OF THE COMPANY:
(Amount in Rs. lakhs)
Financial results for the year ended
31st March, 2018
31st March, 2017
Profit/ (Loss) before tax
Less: Tax Expenses
Profit / (Loss) for the year
Add: Balance as per last financial statements
Less: Transfer to statutory reserve U/s 45-IC of RBI Act 1934
Surplus/(Deficit) in the Statement of Profit and Loss
2. STATE OF COMPANY AFFAIRS:
The year 2017-18 is a profitable year for the Company wherein your company recorded a profit after tax of RS.277.72 lakh as compared to RS.188.26 lakh in the previous Financial Year showing growth of approx 48%. Your company has earned approx RS.1089.24 lakh in the current fiscal year which pertains to interest income .
During the year 2017-18 , your company has drastically increased its loan book size, secured and unsecured, both in terms of value and count as compared to its previous year. The Company is concentrating more on lending activities as can be reflected from the Loan Book which has increased nearly 3 times as compared to last year. Your company as on 31st March 2018 has crossed the asset size of RS.100 crore .
The EPS (both basic & diluted) of your company is reflected as RS.3.94 and RS.3.93 respectively.
3. CHANGE IN NATURE OF BUSINESS:
There has been no change in nature of business of the Company during the F.Y. 2017-2018. Your company is engaged in financial services i.e. providing Loan against securities, so there is only one segment reporting as per AS 17.
Your Board of Directors has declared that the funds of the Company are required for future expansion of the Company and so the profits of the Company for the year ended 31st March 2018 shall be deployed for the said purpose. The Board has decided not to recommend any dividend for the year ended 31st March 2018.
5. CHANGES IN SHARE CAPITAL:
During the year the Company issued 38,05,174 equity shares of face value of RS.10/- each and & 10,80,000 convertible warrants of face value of RS.10/- each at RS.36/- per shares at a premium of RS.26/- per share on preferential basis to promoter & non-promoter group on 27th March 2018. The new Equity Shares issued shall rank pari passu with the existing Equity Shares of the Company in all respects.
Consequent to issue of the additional Equity Shares as above, the issued and subscribed Share Capital of the Company stands to RS.1080.62 lakh divided into 1,08,06,174 Equity shares of RS.10/- each and Paid up Share Capital stands to RS.1080 lakh divided into 1,08,00,000 Equity shares of RS.10/-each. Further the paid up share capital on fully diluted basis stands to RS.1188 lakh divided into 1,18,80,000 Equity shares of RS.10/- each.
Further the Company has utilized the proceeds of the Preferential issue after the end of F.Y. 31.03.2018 and the said proceeds were utilized for the objects as mentioned in the notice of Shareholders and Private Placement Offer Letter. Also there has been no deviation in utilization of proceed pursuant to regulation 32 of SEBI (LODR) Regulation 2015.
6. TRANSFER TO RESERVE:
Your company proposes to transfer RS.55.54 lakhs to statutory reserve under section 45 IC of RBI Act 1934 for the year ended 31st March 2018.
7. DIRECTORS & KEY MANAGERIAL PERSON: DIRECTORS
During the year there stood changes in the Board of the Company wherein Mr. K.P Khandelwal, Independent Director, Mr. K.K.Saraf, non executive director & Ms. Anju Mundhra, Executive Director resigned from the directorship of the Company w.e.f. 13.09.2017, 01.11.2017 & 20.11.2017 respectively. Further Your directors at its meeting held on 14th February 2018 on the recommendation of the Nomination and Remuneration Committee had appointed Ms Suparna Sengupta as the Additional Director in the capacity of NonExecutive Independent Director with effect from 14.02.2018 for a period of 3 years subject to approval of shareholders at the ensuing Annual General Meeting.
RETIREMENT BY ROTATION
Pursuant to regulation 36 of SEBI (LODR) Regulation 2015, a brief resume / details relating to Directors who are proposed to be appointed/re-appointed and the details of the director liable to retire by rotation is furnished in the Notice of the ensuring Annual General Meeting (AGM) of the Company. The Board of Directors of your Company recommends the reappointment of the Director liable to retire by rotation at the ensuing Annual General Meeting (AGM).
All the Independent Directors have given a declaration that they meet the criteria of independence as laid down under Section 149(6) of the Act and as per regulation 25 of SEBI (LODR) Regulation 2015. All requisite declarations were placed before the Board.
In compliance with the requirement of Regulation 25 of Listing Regulations, the Company has conducted familiarization programme for the Independent Directors to familiarize them about the Company and their roles, rights, responsibilities in the Company. The details of the familiarization programme are uploaded on the website of the Company at http://www.ashikagroup.com/PDF/ familiarization%20programme.pdf.
The major highlights of the Remuneration Policy of the Company framed on selection and appointment of Directors, Key Managerial Personnel, Senior Management Personnel and their remuneration, including criteria for determining qualifications, positive attributes, independence of a Director and other matters provided under sub-section (3) of section 178, are disclosed in the Corporate Governance Report . The policy is uploaded at the website of the Company at http:// www.ashikagroup.com/PDF/Remuneration_Policy_final. pdf.
KEY MANGERIAL PERSONNEL
In terms of section 203 of Companies Act 2013 and rules made thereon, the following are the Key Managerial Personnel of the Company.
1) Mr. Pawan Jain-Whole Time Director (Executive Chairman)
2) Mr Daulat Jain - Managing Director & CEO
3) Mr Amit Jain - Chief Financial Officer
4) Ms Anju Mundhra - Company Secretary
8. NUMBER OF MEETINGS OF THE BOARD:
The Company has duly complied with section 173 of the Companies'' Act 2013. During the year under review, five board meetings were convened and held. The date on which meeting were held are as follow 30th April, 2017, 27th July 2017, 23rd October 2017, 14th February 2018 & 22nd February 2018.The maximum interval between any two meetings did not exceeded 120 days.
9. FORMAL ANNUAL EVALUATION:
During the year, the Board has carried out the annual evaluation of its own performance as well as the evaluation of the working of its Committees and individual Directors. This exercise was carried out through a structured questionnaire prepared separately for Board, Committee, Chairman and individual Directors.
The questionnaire and evaluation process was reviewed & reframed in the context of SEBI Guidance Note on Board evaluation dated January 5, 2017 and necessary alignment was made with the requirements. Separate exercise was carried out to evaluate the performance of chairman and Managing Director on basis of the parameters such as contribution, independent judgment, effective leadership to the Board, safeguarding of minority shareholders interest etc.
The Nomination and Remuneration Committee has carried out evaluation of every director''s performance and reviewed the self evaluation submitted by the respective directors. These meetings were intended to obtain Directors'' inputs on effectiveness of Board/ Committee processes.
The Independent Directors at their meeting, reviewed the performance and role of non-independent directors and the Board as a whole and Chairman of the Company. Further, the IDs at their meeting had also assessed the quality, quantity and timeliness of flow of information between the Company management and the Board that was necessary for the Board to effectively and reasonably perform their duties.
The Board considered and discussed the inputs received from the Directors, which reflects the overall engagement of board and its committee with the Company. Board''s actions and decisions are aligned with the Company''s best interest. All Directors are interactive and participative. The Directors at the individual level enhances the value of boards'' effectiveness by elevating its knowledge and integrating the same in all desired ways so as to commit to the goal of sustainably elevating the Company''s value creation for the long term. The Chairman has wide knowledge and vast experience and skills and understanding of the Board''s Functioning.
10. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES :
The statement containing the disclosure as required in accordance with the provisions of Section 197(12) of the Companies Act, 2013 read with rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure A. and forms part of the Board Report.
Further, none of the employees of the Company are in receipt of remuneration exceeding the limit prescribed under rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 so details required pursuant to Section 197(12) of the Companies Act 2013 read with rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is not applicable. Further the details of top ten employee of the Company is annexed as Annexure A..
11. DETAILS OF SUBSIDIARY / JOINT VENTURES / ASSOCIATE COMPANIES:
Your Company has neither a Subsidiary Company nor a Joint Venture Company or an Associate Company during the year under review.
12. AUDITORS STATUTORY AUDITOR
Pursuant to section 139(1) of Companies Act 2013 read with applicable rules thereon M/s. Haribhakti & Co. LLP ( Registration no: 103523W/W100048) have been appointed as Statutory Auditors of the Company for a period of 5 year from the conclusion of 24th Annual General Meeting held in 2017 till the conclusion of the 29th Annual General Meeting to be held in the year 2022, subject to ratification by shareholders in every AGM.. Pursuant to the Companies Amendments Act 2017 w.e.f. 07.05.2018 the proviso to section 139(1) of Companies Act 2013 in regard to the ratification of appointment of Statutory Auditor in every Annual General Meeting has been omitted.
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. MR & Associates (Membership no 4515), Practicing Company Secretaries to undertake the Secretarial Audit of the Company for the financial year 2017-18. The Secretarial Audit Report for the year ended 31st March 2018 is annexed herewith as Annexure B. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.
Pursuant to the provisions of Section 138 of the Companies Act, 2013 and rules framed thereon, your Company has appointed M/s. Shyamsukha Amit & Associates, Chartered Accountant to undertake the Internal Audit of the Company for the F.Y. 2017-2018. There stood no adverse finding & reporting by the Internal Auditor in the Internal Audit Report for the year ended 31st March 2018.
The Auditors'' Report does not contain any qualifications, reservation or adverse remarks .The statutory Auditor has not reported any incident of fraud to the Audit committee or Board of Directors of the Company in the year under review.
With a view to have a more focused attention on business and for better governance and accountability, and in accordance with applicable provisions, your Board has the following mandatory committees viz. Audit Committee, Stakeholders'' Relationship Committee and Nomination and Remuneration Committee. The details of the committee with terms of reference along with composition, meeting held and attended by the Directors during the year are provided in the Corporate Governance Report as per Regulation 34 of SEBI (LODR) Regulations, 2015.
14. VIGIL MECHANISM / WHISTLE BLOWER POLICY:
Your Company has established a vigil mechanism for Directors and employees to report their genuine concerns and about unethical behavior, actual or suspected, fraud or violation of the Codes of conduct or ethics policy. It has adopted a Whistle Blower Policy and the same is hosted on the website of the Company (http://www.ashikagroup. com/PDF/Vigil_Mechanism_Policy.pdf). The details of the said vigil mechanism have been given in the Corporate Governance Report annexed to this Report.
15. RISK MANAGEMENT POLICY:
Pursuant to section 134(n) of Companies Act 2013 and Regulation 17(9) of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, your company has a robust Risk management framework to identify, evaluate business risk and opportunities. This framework seeks to create transparency, minimize adverse impact on the business objectives and enhance the competitive advantage. The framework has a different risk model which helps in identifying risk trends, exposure and potential impact analysis at a company level. The key business risk identified by the Company are related to Market Risk, Operational Risk, Interest Risk, Credit Risk, Liquidity Risk, Human Resource Risk and Regulation & Compliance and other related which are covered in MDA report..
16. CORPORATE SOCIAL RESPONSIBILITY:
The provisions of Sec 135 is not applicable for your Company, therefore the Company has not taken any initiatives for implementation of CSR accordingly.
17. EXTRACT OF ANNUAL RETURN:
Companies Act, 2013 makes mandatory for every company to prepare an extract in the format prescribed MGT 9. The details extract forming part of the Annual Return as on 31st March 2018 is annexed herewith as Annexure - C.
18. MATERIAL CHANGES:
There have been no material changes and commitments affecting the financial position of the Company, which have occurred since 31st March 2018, being the end of the Financial Year of the Company to which financial statements relate and the date of the report.
19. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURT OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY''S OPERATION IN FUTURE:
There are no significant material orders passed by the Regulators / Courts/Tribunals which would impact the going concern status of the Company and its future operations. The court has granted a stay order on 12.09.2012 in connection to our application filed u/s 482 Hon''ble High Court, Calcutta against the compliant filed by Manali Properties Limited and M/S. Manali Properties & Finance Private Limited against company & its officers u/s 200 of the Criminal Procedure Code before the Court of Metropolitan Magistrate , Kolkata. The matter is still pending before Bankshall court and High Court, Kolkata.
20. ADEQUACY OF INTERNAL FINANCIAL CONTROLS RELATED TO FINANCIAL STATEMENTS:
The Company''s Internal Financial Control System is commensurate with the size, scale and complexity of its operations. Detailed procedural manuals are in place to ensure that all the assets are safeguarded, protected against loss, proper prevention & detection of frauds & error, the accuracy and completeness of the accounting records, and all transactions are authorized, recorded and reported correctly. The scope and authority of the Internal Audit (IA) function is defined in the internal financial control policy. These are monitored and routinely monitor and evaluated by the Statutory as well as Internal Auditors.
The Internal Auditor monitors and evaluates the efficiency and adequacy of Internal Financial control system in the Company, its compliance with operating systems, accounting procedures and policies. To maintain its objectivity and independence, the Internal Auditor reports directly to the Chairman of the Audit Committee of the Board, all the significant audit observations and follow up actions thereon. Both Statutory and internal auditor have quarterly sessions with the Audit committee. The Internal audit reports are placed before the Audit committee on quarterly basis and all findings and observation are recorded thereon. The said observation and comments, if any of the Audit Committee are placed before the board.
21. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF COMPANIES ACT 2013
Your Company is non deposit taking NBFC company.. During the year under review the Company has not made any investment and given any guarantee. The detail of Loan given pursuant to Section 186 are mentioned in the notes to the Financial Statements.
Your company is Non Deposit taking NBFC registered with RBI, thus the said clause is not applicable and the Company does not accept any deposit. The Board of Directors has duly passed a resolution in their meeting giving effect to the aforesaid statement.
23. CONTRACTS/ TRANSACTIONS / ARRANGEMENTS WITH RELATED PARTIES:
All contracts/ arrangements/transactions with related parties entered by the Company during the financial year 2017-18 were at arm''s length basis and in the ordinary course of business and are in compliance with the applicable provision of the Companies Act 2013 and SEBI (LODR) Regulation 2015. There were no materially significant related party transactions made by the Company with Directors, their relatives etc which may have a potential conflict with the interest of the Company at large. Members may refer to the notes to the financial statements for details of related party transactions and hence the Company is not required to provide the details of form AOC-2..
In terms of Regulation 23(2) of SEBI Listing Regulations, 2015, All transactions with Related Parties are placed before the Audit Committee for approval and the committee also grants omnibus approval from time to time for Related Party Transactions.
The Policy on Related Party Transactions has been posted on the Company''s website at http://www.ashikagroup.com/ PDF/ASHIKA_RTPpdf.
24. CORPORATE GOVERNANCE REPORT:
Pursuant to Regulation 34 of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 with the Stock Exchanges, the report on Corporate Governance and Management Discussion & Analysis forms part of the Annual Report. The Certificate from the Auditors'' of the Company confirming compliance with the conditions of Corporate Governance as stipulated under Schedule V of Regulation 34 of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 also constitute an integral part of the Annual Report.
25. DISCLOSURES ON POLICY AGAINST SEXUAL AND WORKPLACE HARASSMENT:
The Company has adopted a''Policy for Prevention of Sexual Harassment'' to prohibit, prevent or deter any acts of sexual harassment at workplace and to provide the procedure for the redressal of complaints pertaining to sexual harassment, thereby providing a safe and healthy work environment. The said policy is upload on the website of the Company at http:// www.ashikagroup.com/PDF/sexual%20harassment%20 policy-ACCL.pdf. The Company believes that it is the responsibility of the organisation to provide an environment to its employee who is free of discrimination, intimidation and abuse and also to protect the integrity and dignity of its employees and to avoid conflicts and disruptions in the work environment. Further there stood no cases filed during the year under review.
27. DISCLOSURES UNDER SECRETARIAL STANDARD
During the year under review your company was in compliance with applicable Secretarial Standard issued by Institute of Company Secretaries of India.
28. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGOES:
Since the Company does not own any manufacturing facility, the requirements pertaining to disclosure of particulars relating to conservation of energy, technology absorption and foreign exchanges earning and outgo, as prescribed under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are not applicable.
29. DIRECTORS RESPONSIBILITY STATEMENT:
Your Directors to the best of their knowledge and belief and according to the information and explanation obtained by them make the following statement in terms of clause (c) of sub-section (3) of section 134 of Companies Act 2013 that —
a) In the preparation of the annual accounts for the financial year ended on 31st March 2018, the applicable accounting standards had been followed along with proper explanation relating to material departures.
b) The directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March 2018 and of the profit and loss of the Company for that period;
c) The directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of Companies Act 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) The directors had prepared the annual accounts on a going concern basis;
e) The directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.
f) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively
The Directors are thankful and acknowledge the unstinting support extended by exchanges, its bankers, business partner and other stakeholders and place on record their sincere appreciation of its employees of the Company for their commitment and hard work in the growth of the Company.
For and on behalf of the Board of Directors
(DAULAT JAIN) (PAWAN JAIN)
Place: Kolkata Managing Director Chairman
Date: 28/05/2018 DIN: 00040088 DIN: 00038076