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Gemstone Investments Ltd.

BSE: 531137 | NSE: | Series: NA | ISIN: INE503D01027 | SECTOR: Finance - Investments

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Annual Report

For Year :
2015 2014 2013 2012 2010 2009 2008 2005

Director’s Report

The directors are pleased to present this 21st Annual Report of the Company along with the audited financial statements for the financial year ended 31st March, 2015. Financial Results: The performance of the Company for the Financial Year ended March 31, 2015 is, summarized as below: Particulars FY 2014-15 FY 2013-14 Income from Operations 23,223,874.00 10,892,635.00 Other Revenue ---- 7,482.00 Total Revenue 23,223,874.00 10,900,117.00 Employee benefits expense 2,760,635.00 1,990,487.00 Finance costs 1,160,811.46 1,216,532.01 Depreciation and amortization expense 125,127.00 128,100.00 Other expenses 12,997,287.00 4,809,268.22 Total Expenses 17,043,860.46 8,144,387.23 Profit before Exceptional Items and Tax 6,180,013.54 2,755,729.77 Exceptional Items ---- ---- Profit Before Tax 6,180,013.54 2,755,729.77 Current Year Tax 2,062,921.00 904,647.00 Deferred Tax (1,038.00) 4,609.00 Profit After Tax 4,118,130.54 1,846,473.77 Profit for the Year 4,118,130.54 1,846,473.77 Balance brought forward 6,917,146.83 5,070,673.06 Balance carried forward 11,035,277.37 6,917,146.83 Gross Income increased from 10,900,117/- in the FY 2013-14 to 23,223,874/- in FY 2014- 15, recording an increase by 12,323,757. The Profit after Tax also increased to Rs. 4,118,130.54/- in FY 2014-15 as against Rs. 1,846,473.77/- in the FY 2013-14. Operations: The operations of the Company are more elaborated in the annexed ''Management Discussion and Analysis Report'' which also forms a part of Annual Report. Share Capital: The Authorized Share Capital of the company was Rs. 100,000,000/- and the Paid-up Equity Share Capital of the Company as on March 31, 2015, was Rs. 74,750,000. There was no public issue, rights issue, bonus issue or preferential issue etc. during the year. The Company has not issued shares with differential voting rights, sweat equity shares nor has it granted any stock options. Thus, there was no change in the Authorized or Paid-up Capital or Subscribed Capital during the Financial Year 2014-15. Dividend: The Company is in the stage of expansion and thus, in order to conserve the resources of the Company, the Management has not recommended payment of any dividend on the Equity Shares, for the current FY 2014-15. Transfer to Reserves: The Company has not transferred any amount to Reserves in the Financial Year 2014-15. Subsidiaries and Associates: - Subsidiary / Joint Ventures: The Company does not have any Subsidiary or Joint Ventures. - Associate Company: The Company holds 24.00% shares in the company Asian Fintrade Services Pvt. Ltd. Thus Asian Fintrade Services Pvt. Ltd is an Associate Company as per meaning of Section 2(6) of the Companies Act, 2013 (Act). In terms of Section 129 of the Companies Act, 2013 read with third proviso to Rule 5 of Companies (Accounts) Rules, 2014, the statement containing the salient feature of the financial statement of Associate Company in form AOC-1 is enclosed as Annexure A which forms part of this report. Directors: - Appointment: 1. Pursuant to the provisions of Section 149 of the Act, which came into effect from April 1, 2014, Mr. Hitesh Dave, Mr. Mahendra Dave, and Mrs. Shikha Kapasi were appointed as independent directors at the annual general meeting of the Company held on September 30th, 2014. The terms and conditions of appointment of independent directors are as per Schedule IV of the Act. They have submitted a declaration that each of them meets the criteria of independence as provided in Section 149(6) of the Act and there has been no change in the circumstances which may affect their status as independent director during the year. 2. Mr. Devendrakumar Shah was appointed as a Non-Executive director and Mr. Muljibhai Chheda as an Executive Director liable to retire by rotation at the meeting held on 30th September, 2014 in terms of Section 152 & 160 of the Act. 3. The Company has received notice together with requisite deposit of Rs. 1 Lac under Section 160 of the Companies Act, 2013, from the members of the Company proposing the candidature of Mr. Dharmesh Belani and Mrs. Mamata Shetty as a Non Executive Independent Director for a term of five years. Their appointment has been proposed in the Annual General Meeting and a resolution for their appointment forms part of the notice convening the said Annual General Meeting. - Re-appointment: In accordance with the provisions of the Companies Act, 2013, Mr. Muljibhai Chedda and Mr. Nimesh Ganatra, Director of the Company, being the longest in the office amongst the four directors liable to retire by rotation, retires from the Board by rotation this year and, being eligible, has offered their candidature for re-appointment. Necessary resolution for this purpose is being proposed in the notice of the ensuing Annual General Meeting for the approval of the members. None of the Independent Directors are due for reappointment. Key Managerial Personnel: During the year under review, Mr. Anant Palan, Managing Director and Mr. Rohan Barot, Chief Financial Officer (appointed w.e.f 14th November, 2014) were designated as Key Managerial Personnel of the Company pursuant to Section 203 of the Companies Act, 2013. Declaration by Independent Directors: The independent directors have submitted the Declaration of Independence, as required pursuant to section 149 (7) of the Companies Act, 2013 stating that they meet the criteria of independence as provided in sub-section (6). Policy on Directors'' Appointment and Remuneration: The Nomination & Remuneration Committee constituted in accordance with the Section 178 of Companies Act & Revised Clause 49 of Listing Agreement formulates the policy for appointment, removal and remuneration of Directors. The Directors of the Company are appointed by shareholders at the General Meetings. As regards the appointment and tenure of Independent Directors, the Company has adopted the provisions of the Companies Act, 2013 read with Clause 49 of the Listing Agreement. The Company''s Remuneration Policy for Directors, Key Managerial Personnel and Senior Management is enclosed as Annexure B to this Report. Performance Evaluation of the Board: Pursuant to Clause 49 of the Listing Agreement, the Companies Act, 2013, and Schedule IV of the Companies Act, 2013, the evaluation of the Board as a whole and all directors was conducted based on identified criteria and framework. The performance evaluation of the Chairman, Managing Director and the Non-Independent Directors was carried out by the Independent Directors and the performance evaluation of the Independent Directors was carried out by the entire Board excluding the director being evaluated. The Board has carried out an annual performance of the directors individually, as well as the evaluation of the working of its Audit, Nomination & Remuneration, Stakeholders Relationship & Risk Management Committees. Directors'' Responsibility Statement: Pursuant to Section 134(5) of the Companies Act, 2013, the board of directors, to the best of their knowledge and ability, confirm that: - In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures; - They 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 at the end of the financial year and of the profit of the Company for that period; - They have 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; - They have prepared the annual accounts on a going concern basis; - They have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively; - They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. Board Meetings: Five meetings of the board were held during the year. Details of the meetings of the board are included in the Corporate Governance Report, which forms a part of this report. Audit Committee: The Audit Committee comprises of 4 Directors, All the recommendations made by the Audit Committee were accepted by the Board. Further Details pertaining to Audit committee are included in the Corporate Governance Report, which forms part of this report. Auditors: - Statutory Auditors: Pursuant to the provisions of Section 139 of the Act and the rules framed, the Statutory Auditors of the Company, M/s. N R Gala & Associates were appointed on 29.09.2014 for a term of three years subject to ratification at every Annual General Meeting. Necessary resolutions for the ratification by members have been put across in the notice which forms a part of this report. The auditors'' report for the financial year 2014-15 does not contain any qualifications, reservations or adverse remarks. - Secretarial Auditor: Pursuant to Section 204 of the Act and rules framed therein the Board of Directors had appointed M/s. Mayank Arora & Co. the Practicing Company Secretary Firm as a Secretarial Auditor on the recommendation of the Audit committee, to conduct Secretarial Audit for the financial year 2014-15. Their report of the Secretarial Audit is given as an Annexure C which forms part of this report. - Internal Auditor: The Board on recommendation of the Audit Committee had appointed M/s. Tejas Nadkarni & Associates as the Internal Auditors. Risk Management The Board of the Company has formed a risk management committee to frame, implement and monitor the risk management plan for the Company. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The broad terms of reference of the Committee are stated in the Corporate Governance Report. The audit committee has additional oversight in the area of financial risks and controls. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. Deposits: The Company did not hold any public deposits at the beginning of the year nor has it accepted any public deposits during the year under review. Particulars of Loans, Guarantees and Investments: The Company, being a non-banking finance company registered with the Reserve Bank of India and engaged in the business of giving loans, is exempt from complying with the prescribed limits as specified under the provisions of section 186 of the Companies Act, 2013. The details of investments made are given in Notes to the Financial Statements which forms a part of this Report. Particulars of Contracts or Arrangements Made With Related Parties: None of the transactions with related parties falls under the scope of Section 188(1) of the Act. Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure D in Form AOC-2 and the same forms part of this report. Conservation of Energy and Technology Absorption: The Company, being a nonbanking finance company (NBFC), does not have any manufacturing activity. The information required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption and foreign exchange earnings/outgo is appended hereto as Annexure E and it forms part of this Report. Corporate Social Responsibility: The conditions as prescribed under the section 135 of the Companies Act, 2013, requiring a Company to constitute a Corporate Social Responsibility Committee is not applicable to the Company. The Board of Directors also periodically reviews the applicability of CSR rules to the Company so as to take necessary steps for constitution of Committee, if required. Extract of annual return: As provided under Section 92(3) of the Act, the extract of annual return is enclosed as Annexure F in the prescribed Form MGT-9, which forms part of this report. RBI Guidelines: The Company is a non-deposit accepting NBFC registered with the Reserve Bank of India. The Company provided all required information to the RBI for the financial year under the review. The Company continues to fulfill all the norms and standards as laid down by the Reserve Bank of India. Management Discussion and Analysis: Pursuant to clause 49 of the Listing Agreement entered into with the Stock Exchanges, Management Discussion and Analysis is given separately forming part of this Report. Corporate Governance: The Company has complied with all the mandatory requirements of Corporate Governance specified by the Securities & Exchange Board of India through clause 49 of the Listing Agreement. As required by the said clause, a separate Report on Corporate Governance forms part of the Annual Report of the Company. A certificate from the Statutory Auditors of the Company regarding compliance with the conditions of Corporate Governance also forms part of this Report. Regulatory Actions: There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and operations of the Company in future. Internal Financial Control Systems: The Company''s internal control system is designed to ensure operational efficiency, protection and conservation of resources, accuracy and promptness in financial reporting and compliance with laws and regulations. The internal control system is supported by an internal audit process for reviewing the adequacy and efficacy of the Company''s internal controls, including its systems and processes and compliance with regulations and procedures. Internal Audit Reports are discussed with the Management and are reviewed by the Audit Committee of the Board which also reviews the adequacy and effectiveness of the internal controls in the Company. The Company''s internal control system is commensurate with the size, nature and operations of the Company. The Company has a process in place to continuously monitor the existing controls and identify gaps, if any, and implement new or improved controls. Human Resources: The Company recognizes people as its most valuable asset and has built an open, transparent and meritocratic culture to nurture this asset. Therefore adopts friendly human resource (HR) policies to motivate its employees and create a congenial work environment. Merit based recruitment, adequate training facilities, rewards and recognitions are some of the components of its HR policies. Such policies help in skill enhancement, knowledge up gradation and employee motivation, which in turn, contribute to organizational excellence. Particulars of Employees: During the year ended March 31, 2015, no employee is drawing remuneration in excess of the amount prescribed under Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014. Sexual Harassment at Workplace: The Company has formulated a policy for prevention and deterrence of acts of sexual harassment. The Policy also defines the procedures for the resolution and settlement of complaints, if any. This policy ensures implementation and compliance with the requirements under the law. There were no such complaints received on sexual harassment so far. Vigil Mechanism / Whistle Blower Policy: The Company has formulated a Whistle Blower Policy to provide Vigil Mechanism for employees including directors of the Company to report genuine concerns. The provisions of this policy are in line with the provisions of the Section 177(9) of the Act and the revised Clause 49 of the Listing Agreements with stock exchanges The Policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination will be meted out to any person for a genuinely raised concern. Disclosures: - There has been no change in the nature of business of the Company during the year under review. - There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of financial year and the date of this Report. - There Company did not issue any equity shares with differential rights as to dividend, voting or otherwise. - The Managing Director of the Company does not receive any remuneration or commission from any of its subsidiaries. Acknowledgement: Your Directors wish to convey their gratitude and appreciation to all the employees of the Company for their valuable contribution during the year through their dedication, hard work and commitment and the trust and confidence reposed on us. They also wish to place on record their appreciation of the Company''s customers, shareholders, investors, bankers, agents, suppliers, distributors and other business associates for their cooperation and support. Your Directors especially appreciate the continued understanding and confidence of the Members. For and on behalf of the Board Sd/- Place: Mumbai Mahendra Dave Date: 5th September, 2015. Chairman & Director

Director’s Report