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Emkay Global Financial Services Directors Report, Emkay Global Reports by Directors
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Emkay Global Financial Services

BSE: 532737|NSE: EMKAY|ISIN: INE296H01011|SECTOR: Finance - General
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Directors Report Year End : Mar '18    Mar 17

Dear Members,

The Directors present the Twenty Fourth Annual Report of your Company and the Audited Financial Statements for the year ended 31st March, 2018.

1. FINANCIAL RESULTS

An overview of the financial performance of your Company along with its Subsidiaries for the year 2017-18 is as under:

(Amount in lac)

Particulars

Standalone

Consolidated

Year ended

Year ended

31.03.2018

31.03.2017

31.03.2018

31.03.2017

Total Income

13298.37

9662.41

15656.71

10,884.15

EBITDA

2975.03

1,710.15

4551.57

2,373.54

Less : Depreciation and Amortization

452.61

403.06

468.12

411.53

Less : Finance Costs

238.73

223.33

430.08

319.67

Profit Before Exceptional Item & Tax

2283.69

1,083.77

3653.37

1,642.35

Exceptional Item

-

335.00

-

-

Profit Before Tax

2283.69

748.77

3653.37

1,642.35

Less : Tax Expense

489.46

287.18

787.57

423.17

Profit after Tax

1794.23

461.59

2865.80

1,219.18

Less : Share of Loss of Associate

-

-

4.39

-

Profit/(Loss) attributable to Shareholders of the Company

1794.23

461.59

2861.41

1,219.18

Opening balance in Statement of Profit and Loss

713.85

252.26

1418.46

253.96

Amount available for Appropriation

2508.07

713.85

4279.87

1,473.14

Appropriations*

Dividend Paid on Equity Shares for FY 2016-17

245.09

-

245.09

-

Dividend Distribution Tax-on Dividend for FY 2016-17

49.90

-

49.90

-

Transfer to Special Reserve u/s 45-IC of RBI Act

-

-

183.78

54.68

Closing balance in Statement of Profit and Loss

2213.08

713.85

3801.10

1,418.46

*As per the requirements of pre-revised AS 4-’Contingencies and Events occurring after the balance sheet date’, the Company used to create a liability for dividend proposed /declared after the balance sheet date for dividend related to periods covered by the financial statements. As per AS 4 (Revised), with effect from April 2016, the Company is not required to provide for dividend proposed/declared after the balance sheet date.

2. DIVIDEND

The Board of Directors are pleased to recommend a final dividend at the rate of Rs. 1.50 (15 %) per equity share and one time special dividend of Rs. 0.50 (5%) per equity share totaling to Rs. 2 (20%) per equity share of the face value of Rs. 10 for the year ended 31st March, 2018 (Previous year - Rs. 1 per equity share). This would involve a payout of Rs. 591.54 lac including dividend distribution tax (previous year - Rs. 294.99 lac) based on the number of shares as on 31st March, 2018. The dividend would be paid to all the shareholders, whose names appear in the Register of Members/Beneficial Holders list on the

Book Closure date. This Dividend is subject to approval of the Members at the forthcoming 24th Annual General Meeting.

3. REVIEW OF OPERATIONS

Standalone

During the year under review, your Company recorded a total income of Rs.13298.37 lac as against Rs. 9662.41 lac in the previous Financial Year, marking an increase of 37.62%. The profit for the same period stood at Rs. 1794.23 lac vis-a-vis the profit of Rs. 461.59 lac in the previous Financial Year.

Consolidated

During the year under review, your Company recorded a total income of Rs. 15656.71 lac as compared to Rs. 10,884.15 lac in the previous Financial Year, marking an increase of 43.85%. The Profit for the same period stood at Rs. 2865.80 lac vis-a-vis the Profit of Rs. 1219.18 lac in the previous Financial Year.

4. EXTRACT OF ANNUAL RETURN

As provided under Section 92(3) of the Companies Act, 2013 (Act), the extract of annual return is given in Annexure A in the prescribed form MGT-9, which forms part of this report.

5. LAUNCH OF EMKAY EMERGING STARS FUND, A CATEGORY III ALTERNATIVE INVESTMENT FUND (AIF)

Emkay Emerging Stars Trust, sponsored by Emkay Global Financial Services Ltd and managed by Emkay Investment Managers Ltd. (EMIL), a wholly owned subsidiary of the Company launched “Emkay Emerging Stars Fund”, a Category III Alternative Investment Fund (AIF) on 11th October, 2017 after receipt of approval from the Securities and Exchange Board of India (SEBI). Emkay Emerging Stars Fund is a five-year closed ended fund, focused on enabling long term capital appreciation for investors. In a short span of three months from the date of launch, the fund attained the milestone of crossing Rs. 200 crore in Assets Under Management (AUM).

6. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS

During the Financial Year 2017-18, 5 meetings were held on 24th May, 2017, 6th July, 2017, 11th August, 2017, 13th November, 2017 and 29th January, 2018.

The details of the attendance of Directors at the meetings are as under:

Name of the Director

Category

Board Meetings during Financial Year 2017-18

Held

Attended

Mr. G. P Gupta

NED (I)

5

5

Mr. S. K. Saboo

NED

5

5

Mr. R. K. Krishnamurthi

NED (I)

5

4

Mr. G. C. Vasudeo

NED (I)

5

5

Mr. Krishna Kumar Karwa

ED

5

5

Mr. Prakash Kacholia

ED

5

5

Mrs. Preeti Kacholia

NED

5

5

Dr. Satish Ugrankar

NED (I)

5

5

Dr. Bharat Kumar

NED (I)

-

-

Singh (appointed

w.e.f. 29.01.2018)

7. DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(3)(c) of the Companies Act, 2013, the Directors confirm that:

a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b) The Directors have 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;

c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) The Directors have 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; and

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.

8. AUDIT COMMITTEE

The Audit Committee comprises of Mr. G. C. Vasudeo as the Chairman and Mr. G. P. Gupta, Mr. R. K. Krishnamurthi, Dr. Satish Ugrankar and Mr. Prakash Kacholia as the members of the committee. More details pertaining to the Audit Committee are included in the Corporate Governance Report, which forms a part of this report.

9. NOMINATION, REMUNERATION AND COMPENSATION COMMITTEE

The Nomination Remuneration and Compensation Committee constituted by the Board in compliance with Section 178 of the Companies Act, 2013 and Regulation 19 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 comprises

Mr. G. C. Vasudeo, an Independent Director as the Chairman and Mr. R. K. Krishnamurthi, Mr. G. P. Gupta, Dr. Satish Ugrankar and Mr. S. K. Saboo as the members of the Committee.

The Committee consists of only Non-Executive Directors as its members. All the members of the Committee are Independent Directors except for Mr. S. K. Saboo who is a Non-Executive, Non-Independent Director.

The Remuneration Policy of the Company is available on the Company’s website i.e. www.emkayglobal.com/ Investor relations. The details of the composition, terms of reference of the Nomination, Remuneration and Compensation Committee, number and dates of meetings held, attendance of the Directors and remuneration paid to them are given separately in the attached Corporate Governance Report forming part of the Directors’ Report.

10. PERFORMANCE EVALUATION

In terms of provisions of the Companies Act, 2013, read with Rules issued thereunder and Regulation 25 of SEBI (LODR) Regulations, 2015 and further circular no. SEBI/HO/CFD/ CMD/CIR/P/2017/004 dated 05/01/2017 issued by SEBI on “Guidance note on Board Evaluation”, evaluation process was carried out internally for the performance of the Board, its committees and of Individual Directors.

The Independent Directors met on 26th March, 2018 to review performance evaluation of Non-Independent Directors and the Board as a whole including the Chairman.

The Nomination, Remuneration and Compensation Committee carried out evaluation of performance of each Director in their meeting held on 28th May, 2018. The Board of Directors carried out performance evaluation of the Board, each Director and the Committees for the Financial Year ended 31st March, 2018 in their meeting held on 28th May, 2018 based on various aspects which, inter alia, included the level of participation in the Board Meetings, understanding of their roles and responsibilities and of the business of the Company, along with the effectiveness of their contribution.

11. AUDITORS AND THEIR REPORT

Pursuant to the provisions of Section 139 and all other applicable provisions of the Companies Act, 2013 (“the Act”) read with Rule 3(7) of the Companies (Audit and Auditors) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof for the time being in force), S. R. Batliboi & Co. LLP, Chartered Accountants bearing Firm Registration Number 301003E/E300005 with the Institute of Chartered Accountants of India (ICAI) were appointed as the Statutory Auditors of the Company at the 23rd Annual General Meeting held on 11th August, 2017 for a period of five years commencing from the conclusion of the 23rd Annual General Meeting (AGM) till the conclusion of the 28th Annual General Meeting of the Company to be held for the Financial Year 20212022 subject to ratification of their appointment by members at every subsequent AGM. In accordance with the amendment made to section 139 of the Act, the requirement of ratification of appointment by members every year is done away.

M/s. S. R. Batliboi & Co LLP have confirmed their eligibility and qualification required under section 139 and 141 and other applicable provisions of the Companies Act, 2013 and Rules issued thereunder (including any statutory modification(s) or re-enactment(s) thereof) for the time being in force.

There are no qualifications or observations or remarks made by the Auditors in their report.

Reporting of Fraud

The Auditors of the Company have not reported any fraud as specified under Section 143(12) of the Companies Act, 2013.

12. SECRETARIAL AUDIT REPORT

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. Parikh & Associates, Company Secretaries, Mumbai to carry out Secretarial Audit of the Company for the Financial Year 2017-2018. The Secretarial Audit Report received from them is appended as Annexure B and forms part of this report.

There are no qualifications or adverse comments made by the Secretarial Auditors in their report.

13. INTERNAL AUDIT

As per the requirements of Section 138 of the Companies Act, 2013 and rules made thereunder, M/s. Lovi Mehrotra & Associates, Chartered Accountants, Mumbai were appointed as Internal Auditors of the Company for the Financial Year 2017-2018.

The internal control systems are supplemented by extensive internal audits, regular reviews by management and standard policies and guidelines to ensure reliability of financial and all other records to prepare financial statements and other data. The Management Information System (MIS) forms an integral part of the Company’s control mechanism. The Company has regular checks and procedures through internal audit periodically. The reports are deliberated and executive summary of the same, along with Action Taken Report (ATR), for steps taken by the Management to address the issues are placed before the Audit Committee Meeting/ Board Meeting for their review. Reports of internal auditors are reviewed by the Audit Committee, and corrective measures, if any, are carried out towards further improvement in systems and procedures in compliance with Internal Control System. The Board also recognizes the work of the auditors as an independent check on the information received from the management on the operations and performance of the Company.

14. COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD MEETINGS AND ANNUAL GENERAL MEETINGS

The Company has complied with the Secretarial Standards issued by the Institute of Company Secretaries of India on Meetings of the Board of Directors and General Meetings.

15. MANAGEMENT DISCUSSION AND ANALYSIS

A detailed review of the operations, performance and future outlook of the Company and its businesses is given in the Management Discussion and Analysis, which forms part of the Annual Report.

16. PUBLIC DEPOSITS

During the year, your Company has not accepted and/or renewed any public deposits in terms of the provisions of Section 73 and 76 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

17. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees or Investments covered under Section 186 of the Companies Act, 2013, are given under notes to the Financial Statements.

18. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SECTION 188(1) OF THE COMPANIES ACT, 2013

The details of the related party transactions, as per the requirement of Accounting Standards-18 are disclosed in notes to the financial statements of the Company for the Financial Year 2017-18. All the Directors have disclosed their interest in Form MBP-1 pursuant to Section 184 of the Companies Act, 2013 and as and when any changes in their interest take place, such changes are placed before the Board at its meetings. None of the transactions with any of the related parties was in conflict with the interest of the Company. The particulars of contracts or arrangements with related parties referred to in Section 188 (1), in prescribed Form AOC - 2 under Companies (Accounts) Rules, 2014 are appended as Annexure C

19. INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has constituted an Internal Complaint Committee under Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year no complaint was filed before the said Committee.

20. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The prescribed particulars of Conservation of Energy, Technology Absorption and Foreign Exchange Earning and Outgo required under Section 134 (3) (m)read with Rule 8 (3) of the Companies (Accounts) Rules, 2014 are attached as Annexure D and forms part of this Report of Directors.

21. LEVERAGING DIGITAL TECHNOLOGY

During the year under review, the Company achieved substantial performance enhancements in its trading and back-office platforms through implementation of cutting edge hyper-converged infrastructure. The software defined storage not only enabled the Company to consolidate and reduce the physical foot-print of its IT infrastructure, but this approach also helped it to dynamically distribute computing resources and improve the overall availability and uptime for its core applications. The Company has been one of the early adaptors of hyper converged technology among Indian brokerages.

The Company, during the year, also launched a revolutionary charting and trading platform EmTrade. The platform combines unparalleled analytics and execution capabilities and is equipped with unique features and benefits. EmTrade gives real time data across markets and offers several indicators, in-built modules for strategy creation, extensive drawing tools, heat map, global indices, buy-sell alerts among other features.

22. BUSINESS RISK MANAGEMENT

Pursuant to section 134(3) (n) of the Companies Act, 2013 and as per provisions of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has adhered to the principles of sound risk management and already has a Risk Management Policy in place. An exercise is being carried out to identify, evaluate, manage and monitor both business and non-business risk on an ongoing basis. The Board periodically reviews the risks and suggests steps to be taken to control and mitigate the same through a properly defined framework.

The details of the same are set out in the Corporate Governance Report forming part of the Boards’ Report.

23. CORPORATE SOCIAL RESPONSIBILITY

In view of applicability of Corporate Social Responsibility (CSR) provisions in the year 2016-2017, in compliance with the requirements of Section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility) Rules, 2014, the Board at its meeting held on May 23, 2016, had constituted a Corporate Social Responsibility Committee comprising three Directors of the Company including one Independent Director. The members of the Committee are Mr. G. C. Vasudeo, Mr. Krishna Kumar Karwa and Mr. Prakash Kacholia. The Company has evolved a Corporate Social Responsibility Policy and is actively practicing the same. The objectives of the CSR Policy are to contribute to social and economic development of the communities in which the Company operates, to improve the quality of life of the communities through long term value creation for stakeholders and to generate, through its CSR initiatives, a community goodwill for the Company and help reinforce a positive and socially responsible image of the Company as a corporate entity. The Report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 is provided in Annexure E and forms an integral part of this report.

24. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has implemented a Vigil Mechanism Policy to deal with instances of fraud and mismanagement, if any. The policy also provides for adequate safeguards against victimization of persons who use such mechanism and makes provision for direct access to the chairperson of the Audit Committee in all cases. The details of the policy are posted on the website of the Company under the link http://www. emkayglobal.com/investorrelations.There were no complaints received during the year 2017-18.

25. DIRECTORS & KEY MANAGERIAL PERSONNEL

In accordance with the provisions of Section 152 of the Companies Act, 2013 read with the Companies (Appointment & Qualification of Directors) Rules, 2014 and Articles of Association of the Company, Mrs. Preeti Kacholia (DIN: 03481747), Non-Executive Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible, has offered herself for re-appointment. Your Board recommends her re-appointment.

During the year, Dr. Bharat Kumar Singh (DIN: 00274435) was appointed as an Additional Director of the Company with effect from 29th January, 2018. As per provisions of Section 161 of the Companies Act, 2013 and Articles of Association of the Company, Dr. Bharat Kumar Singh holds office up to the date of the forthcoming 24th Annual General Meeting and is eligible for appointment.

Pursuant to the provisions of Section 149, 150, 152 and other applicable provisions of the Companies Act, 2013 and the Rules made thereunder (including any statutory modification(s) or re-enactment thereof for the time being in force), read with Schedule IV of the Companies Act, 2013, your Directors are seeking appointment of Dr. Bharat Kumar Singh as an Independent Director for a term of five consecutive years from the date of the 24th Annual General Meeting. Details of the proposal for appointment of Dr. Bharat Kumar Singh are mentioned in the Explanatory Statement of the Notice of the 24th Annual General Meeting, under Section 102 of the Companies Act, 2013.

The Nomination, Remuneration and Compensation Committee at its meeting held on 28th May, 2018 has recommended the appointment of Dr. Bharat Kumar Singh as an Independent Director of the Company for a period of five years. The Company has received a notice from a Member of the Company under section 160(1) of the Companies Act, 2013, proposing his candidature for the office of Director of the Company. Members are requested to consider the appointment of Dr. Bharat Kumar Singh as an Independent Director.

Brief profiles of Mrs. Preeti Kacholia and Dr. Bharat Kumar Singh, Directors of the Company, as required under Regulation 36 (3) of the SEBI (LODR) Regulations, 2015, are given in the Notice of the 24th Annual General Meeting.

The Company has received declaration from all the Independent directors that they meet the criteria of independence as laid down under section 149(6) of the Companies Act, 2013 read with the Schedule and Rules issued thereunder.

During the year, at the request of Mr. Krishna Kumar Karwa, Managing Director, he was relinquished from the additional responsibility of Chief Financial Officer of the Company w.e.f. 1st June, 2017. Mr. Saket Agarwal, Vice President, Finance & Accounts was appointed as the Chief Financial Officer (CFO) of the Company w.e.f. 1st June, 2017.

The following four persons were formally noted as Key Managerial Personnel of the Company in compliance with the provisions of Section 203 of the Companies Act, 2013.

- Mr. Krishna Kumar Karwa - Managing Director

- Mr. Prakash Kacholia - Managing Director

- Mr. Saket Agrawal - Chief Financial Officer (Appointed w.e.f. 1st June, 2017)

- Mr. B. M. Raul - Company Secretary

26. PARTICULARS OF REMUNERATION

Details of the ratio of remuneration of each Director to the median employee’s remuneration is provided in Annexure F

27. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The Internal Auditors monitor and evaluate the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee of the Board.

Pursuant to the provisions of Section 134 (5) (f) of the Act, the Company has devised proper systems to ensure compliance with the provisions of all applicable laws. Each department of the organization ensured that it had complied with the applicable laws and furnished its report to the Head of department who then along with the Company Secretary discussed on the compliance status of the department. Any matter that required attention was immediately dealt with. The Company Secretary reported to the Audit Committee and the Board on the overall compliance status of the Company. In effect, such compliance system was largely found to be adequate and operating effectively. The Directors have in the Directors’ Responsibility Statement under paragraph (f) also confirmed the same to this effect.

28. SUBSIDIARY/ ASSOCIATE COMPANIES

The Company has 4 subsidiaries as on 31st March, 2018. There are no associate companies within the meaning of Section 2(6) of the Act.

Pursuant to the provisions of Section 129 (3) of the Act, a statement containing the salient features of financial statements of the Company’s subsidiaries in Form AOC-1 is attached to the financial statements of the Company.

Emkay Commotrade Limited (ECL) - a 100% subsidiary:

Emkay Commotrade Limited offers commodity futures trading to its clients. It is a member of three major commodity exchanges viz. Multi Commodity Exchange of India Limited (MCX), National Commodity and Derivatives Exchange Limited (NCDEX) and National Spot Exchange Limited (NSEL). As on date, the Company’s Paid up Capital is Rs. 8.50 crore divided into Rs. 6 crore in Equity Shares and Rs. 2.50 crore in Preference Shares. The Company has a net worth of Rs. 497.28 lac as on 31st March, 2018.

Emkay Fincap Limited (EFL) - a 100% subsidiary:

Emkay Fincap Limited is a RBI registered Non Deposit taking Non - Banking Financial Comapny. EFL has a net worth of Rs. 4934.69 lac as on 31st March, 2018.

Emkay Insurance Brokers Limited (EIBL) - a 100% subsidiary:

Emkay Insurance Brokers Limited is registered with Insurance Regulatory and Development Authority (IRDA) as a Direct Insurance Broker and focuses on life and non-life insurance businesses. EIBL has a net worth of Rs. 72.81 lac as on 31st March, 2018. The Company is pursuing proposals for sale of Insurance Broking Business to another Company.

Emkay Investment Managers Limited (EIML) - a 100% subsidiary:

Emkay Investment Managers Limited is registered with Securities and Exchange Board of India (SEBI) for conducting the business of Portfolio Management Services and has commenced the business of Portfolio Management Services with effect from 1st January, 2011. During the year, the Company has issued 25,00,000 Equity shares of Rs. 10/- each. As on date Company’s Paid up Capital is Rs. 5,00,00,000/divided into 50,00,000 equity shares of Rs.10/- each. EIML has a net worth of Rs. 871.46 lac as on 31st March, 2018.

The Consolidated Financial Statements presented by the Company include financial results of its Subsidiary Companies. The Company will make available the annual accounts of the Subsidiary Companies and the related information to any member of the Company who may be interested in obtaining the same. The annual accounts of the said Subsidiary Companies are also available for inspection by any member of the Company at its Administrative Office situated at Paragon Centre, C-6, Ground Floor, Pandurang Budhkar Marg, Worli, Mumbai - 400 013 during business hours on all days except Saturdays, Sundays and Public holidays upto the date of the AGM. The Annual Report of the Company and all its Subsidiary Companies are also available on the website of the Company www.emkayglobal.com.

29. EMPLOYEE STOCK OPTION SCHEMES

With a view to remain a preferred employer, the Company had granted Stock Options under two Schemes viz. ESOP 2007 and Employee Stock Option Plan - 2010 - through trust route to the employees of the Company and the employees of the Subsidiary Companies. The Company has also introduced new ESOP 2018 scheme approved by the shareholders through the process of Postal Ballot on 21st March, 2018.

Details of the shares issued under Employees Stock Option Plan (ESOP), as also disclosure in compliance with SEBI (Share Based Employees Benefits) Regulations, 2014 are uploaded on the website of the Company, under the link https://www. emkayglobal.com/key-annocuments . No employee has been issued share options during the year equal to or exceeding one percent of the issued capital of the Company at the time of grant.

(a) ESOP 2007

The Nomination, Remuneration and Compensation Committee of the Company had granted options under ESOP-2007 scheme to the eligible employees (each option carrying entitlement for one share of the face value of Rs. 10/- each). Summary of the same as on 31.03.2018 is as under.

Summary of ESOP 2007 as on 31st March 2018:

Total no. of stock options approved

24,26,575

under the Scheme

No. of Options

Date of Grant

Exercise Price Per Option

14,42,000

17.01.2008

Rs. 63/-

2,44,000

19.06.2009

Rs. 63/-

2,07,500

24.07.2009

Rs. 61/-

1,00,000

04.05.2010

Rs. 93/-

6,11,500

27.07.2010

Rs. 77/-

2,00,000

21.01.2012

Rs. 37/-

Exercise Period

3 years

Re-Issued Options

3,78,425

Total no. of stock options granted under

28,05,000

the scheme

Stock Options lapsed

25,26,470

Stock Options vested but not exercised

87,000

Stock Options exercised

1,91,530

Outstanding Stock Options

87,000

During the Financial Year 2017-18, the Nomination, Remuneration and Compensation Committee allotted 1,15,880 Equity Shares to the employee(s) under the ESOP 2007 (including 35,000 Options exercised during the Financial Year 2017-2018 but allotted in next Financial Year i.e. 2018-2019). These shares are listed on the Bombay Stock Exchange Limited and the National Stock Exchange of India Limited. After allotment of the said 1,15,880 equity shares of Rs. 10/- each, Company’s paid-up Share Capital increased to Rs. 24,53,40,300/-.

The disclosures required to be made in the Directors’ Report in respect of the aforesaid ESOP Schemes, in terms of the SEBI (Share Based Employee Benefits) Regulations, 2014 are contained in Annexure G forming part of the Directors’ Report.

(b) EMPLOYEE STOCK OPTION PLAN - 2010 THROUGH TRUST ROUTE

The Nomination, Remuneration and Compensation Committee of the Company had granted total no. of 6,47,000 options under ESOP-2010 scheme through trust route to the eligible employees (each option carrying entitlement for one share of the face value of Rs.10/- each till date). Summary of the same as on 31.03.2018 is as under.

Summary of ESOP 2010 (through trust route) as on 31st March 2018:

Total no. of stock options approved under the Scheme

24,41,995

No. of options

Date of Grant

Exercise Price Per Option

5,55,000

21.10.2010

Rs. 93/- per option

27,000

02.05.2011

Rs. 63/- per option

15,000

22.10.2011

Rs. 48/- per option

50,000

21.01.2012

Rs. 37/- per option

Exercise Period

3 years

Total no. of stock options

6,47,000

granted under the scheme

Stock Options lapsed

5,91,000

Stock Options vested but not exercised

15,500

Stock Options exercised

40,500

Outstanding Stock Options

15,500

During the Financial Year 2017-18, the Nomination, Remuneration and Compensation Committee, through the ESOP trust, transferred 40,500/- Equity Shares to the employee(s) on exercise of options under ESOP 2010 (Through Trust Route).

Details required to be provided are set out in Annexure G to this report.

30. TRANSFER OF UNCLAIMED DIVIDEND AMOUNTS AND SUCH SHARES TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provisions of Section 124 and 125 of the Companies Act, 2013, the Company has transferred on due dates, the unpaid or unclaimed dividends up to the Financial Year 2009-2010 to the Investor Education and Protection Fund (IEPF) established by the Central Government. Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with Companies) Rules, 2012, the Company has uploaded on its website the details of unpaid and unclaimed amounts lying with the Company.

Further, in terms of the provisions of section 124(6) of the Companies Act, 2013 read with The Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 notified by the Ministry of Corporate Affairs, New Delhi w.e.f. 7th September, 2016, and further notifications issued by Ministry of Corporate Affairs, amending the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Amendment Rules, 2017 which has come into force w.e.f. 28.02.2017, all the shares in respect of which dividend has not been paid or claimed for seven consecutive years or more as provided under subsection (6) of Section 124 were transferred to the special Demat Account of IEPF Authority.

The details of the unclaimed/unpaid dividends are available on the Company’s website www.emkayglobal.com and also on the website of the Ministry of Corporate affairs www.mca.gov.in.

31. PARTICULARS OF EMPLOYEES

The particulars of employees required under Section 197 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended are enclosed hereto in Annexure H

32. CORPORATE GOVERNANCE REPORT

The Company adheres to the principles of Corporate Governance mandated by the Securities and Exchange Board of India and has implemented all the prescribed stipulations thereof. As stipulated in Regulation 27 of the Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015, a detailed report on Corporate Governance and the requisite Auditor’s Certificate confirming compliance with the conditions of Corporate Governance, is appended as Annexure I and forms a part of this Report.

33. SIGNIFICANT AND MATERIAL ORDERS PASSSED BY THE COURTS OR REGULATORS

During the year no significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and company’s operations in future.

34. LISTING WITH STOCK EXCHANGES

The Equity shares of the Company are listed on the National Stock Exchange of India Ltd. and BSE Ltd.

35. ACKNOWLEDGEMENT

Your Directors would like to take this opportunity to express sincere gratitude to the customers, bankers and other business associates for the continued co-operation and patronage. Your Directors gratefully acknowledge the ongoing co-operation and support provided by the Government, Regulatory Bodies and the Stock Exchanges. Your Directors place on record their deep appreciation for the exemplary contribution made by the employees at all levels. The Directors also wish to express their gratitude to the valued shareholders for their unwavering trust and support.

On behalf of the Board of Directors

Krishna Kumar Karwa Prakash Kacholia

Managing Director Managing Director

Place : Mumbai

Date : 28th May, 2018

Source : Dion Global Solutions Limited
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