Your Directors have pleasure in presenting their Twenty Fourth Annual
Report together with the Audited Accounts for the year ended March
Particulars 2014-2015 2013-2014
Rs.in Lacs Rs. in Lacs
Total Revenue 153.56 121.67
Total Expenses 162.88 134.98
Profit or Loss before Exceptional and
Extraordinary items and Tax (9.32) (13.31)
Less: Exceptional Items - -
Less: Extraordinary Items - -
Profit /(Loss)before Tax (9.32) (13.31)
Less: Current Tax - -
Deferred Tax (2.63) 0.76
Profit/(Loss) after Tax (6.69) (14.07)
Add: Balance as per statement of Profit & Loss 27.75 41.82
Add: Adjustment relating to Fixed Asset (6.48) -
Balance (statement of Profit & Loss)
Transferred to Balance Sheet 14.57 27.75
REVIEW OF BUSINESS OPERATIONS:
During the financial year 2014-15, the Company''s total revenue has
increased to Rs. 153.56 lakhs compared to Rs. 121.67 lakhs in the
previous year. The total income from operations has increased to Rs.
145.01 lakhs compared to Rs. 104.13 lakhs in the previous year. The
Company was able to reduce losses to Rs. 6.69 lakhs as against Rs.
14.07 lakhs in the previous year.
Income from stock broking operations has increased from Rs. 26.90 lakhs
in the previous year to Rs. 52.15 lakhs in the current year. The
broking turnover of the company in cash segment is Rs. 184.78 crores
compared to Rs. 188.69 crores in the last financial year and in F & O
segment is Rs.2926.61 crores compared to Rs. 501.10 crores in the last
The Company provides institutional broking business and is empanelled
with several public sector banks and insurance companies.
As a Depository Participant the company offers facilities to both
institutional and retail investors to maintain their investments in
securities in electronic form. Income from Depository operations has
increased to Rs. 22.01 lakhs against Rs. 10.05 lakhs in the previous
Portfolio Management Services:
The Company continues to provide PMS services under both discretionary
and non - discretionary basis. Income from Portfolio Management
services amounted to Rs. 0.83 lakhs in the current financial year.
The Company is in the process of doing assignments related to SME
The Company has been appointed as Investment Managers by IL & FS Trust
Company Limited for Valmark Infra and Realty Trust, a SEBI registered
Alternate Investment Fund - Category II (AIF II) .and the first scheme
of the trust is targeting a corpus of Rs 125 crores comprising of units
of INR 1 crore each on private placement basis for investment horizon
of 3 to 5 years. The fund announced its first closing on October 29,
Income from Management services amounted to Rs. 70 Lakhs in the current
The Company will endeavor to increase income from operations by
focusing on HNI''s in the retail segment in stock broking division. The
Company is also working on getting itself empanelled with more public
sector banks and insurance companies under institutional broking. The
Company will continue to focus on getting more HNIs and NRIs in both
discretionary and non-discretionary basis in Portfolio Management
service division. The company will try to do assignments related to SME
segment, delisting and other issue related activities.
The Board of Directors has decided not to recommend any dividend.
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION
The provisions of Section 125(2) of the companies Act, 2013 do not
apply as there was no dividend declared and paid last year.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF
THE COMPANY WHCIH HAS OCCURRED BETWEEN 31ST MARCH 2015 ( THE END OF THE
FINANCIAL YEAR and 22nd MAY 2015 (THE DATE OF REPORT)
There were no material changes and commitments affecting the financial
position of the company between 31st March 2015 ( the end of the
financial year) and 22nd May 2015 (the date of the report).
CONSERVATION OF ENERGY, TECHNOLOGYABSORPTION, FOREIGN EXCHANGE EARNING
The Company has no activities relating to conservation of energy,
technology absorption, foreign exchange earning and outgo and hence the
provisions of Section 134(m) of the Companies Act, 2013 is not
applicable to the Company.
STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT
POLICY OF THE COMPANY
The Risk Management Committee of the Company continuously monitors
business and operations risk through an efficient risk management
DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS
CORPORATE SOCIAL RESPONSIBILITY INITIATIVES:
The Company has not developed and implemented any Corporate Social
Responsibility initiatives as the said provisions are not applicable
for the financial year 2014-15.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186
The Company has not provided working capital loan, Guarantee or
provided security. The details of investments made by the company are
given in the notes to the financial statements.
COMPANY''S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF
REMUNERATION AND DISCHARE OF THEIR DUTIES.
The Company''s Policy relating to appointment of Directors, payment of
managerial remuneration, Director''s qualifications, positive
attributes, independence of Directors and other related matters as
provided under Section 178(3) of the Companies Act, 2013 is furnished
as Annexure 1 and is attached to this report.
The aspects covered in the evaluation included the contribution made by
the Directors to the corporate governance practices, long term
strategic planning, fulfillment of Director''s obligations and fiduciary
responsibilities and active participation at the Board and Committee
meetings. The effectiveness of Board / Committee processes were
assessed based on the Directors'' inputs received during the meetings of
the Board and one to one meeting by the Chairman with the Directors.
EXTRACT OF ANNUAL RETURN
The Extract of Annual return as on March 31,2015 as provided under
Sub-section (3) of section 92 in Form No. MGT - 9 is being annexed as
Annexure 2 to the report
MANAGEMENT DISCUSSION ANDANALYSIS REPORT
Management Discussion and Analysis Report for the year under review, as
stipulated under Clause 49 of the Listing Agreement with the Stock
Exchange is presented in separate section forming part of the Annual
Report as Annexure 3
DIRECTOR''S RESPONSIBILITY STATEMENT:
As requred in Clause (c) of Sub- Section (3) of Section 134 of the
Companies Act, 2013, your Director confirms and state that-
a) In the preparation of the annual accounts, the applicable accounting
standards have been followed, along with proper explanation relating to
b) The Directors had 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 close of the financial year ended 31st March 2015
and of the Profit/Loss of the company for the year ended 31st March
c) The Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, for safeguarding the assets of the
Company and for preventing and detecting fraud and other
d) The Directors have prepared the annual accounts on a going concern
e) The Directors, have 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 Company has not accepted any public deposits and, as such, no
amount on account of principal or interest on public deposits was
outstanding as on the date of balance sheet.
Mr. Bharat Munoth, Mr. Jaswant Munoth and Mr. Lalchand Munoth retires
by rotation at the forthcoming Annual General Meeting and being
eligible offers themselves for re-appointment.
Mr. Jaswant Munoth, whose period of office of Managing Director expired
on June 24, 2015 was appointed as the Managing Director of the Company
for the period of 2 years from 25th June 2015 to 24th June 2017 subject
to the approval of the shareholders at the AGM.
Ms. Lakshika Mehta has been appointed as an Additional Director of the
Company with effect from May 22, 2015. she is proposed to be appointed
as Independent Director at the ensuing Annual General Meeting for a
term of 5 consecutive years from the date of the ensuing Annual General
Meeting as required under Section 149 of the Companies Act, 2013 and
Clause 49 of the Listing Agreement.
The profiles of Mr. Jaswant Munoth, Managing Director, Mr. Bharat
Munoth, Mr. Lalchand Munoth and Ms. Lakshika Mehta are given separately
in the Corporate Governance Report.
DECLARATION OF INDEPENDENT DIRECTORS:
The independent Directors have confirmed and declared that they are not
disqualified to act as an independent Director in compliance with the
provisions of Section 149 of the Companies Act., 2013.
ADEQUACY OF INTERNAL CONTROL, FINANCIAL CONTROLS WITH REFERENCE TO
The Company has in place adequate internal financial controls with
reference to financial statements. During the year under review, such
controls were tested and no reportable material weakness in the design
or operation were observed.
M/s Mardia & Associates, Chartered Accountants ,who are the statutory
auditors of the Company, hold office until the conclusion of the
ensuing AGM and are eligible for re-appointment. Members of the Company
at the AGM held on 20th September, 2014 had approved the appointment of
Mardia & Associates as the Statutory Auditors for a period of three
financial years i.e., up to 31 March, 2017. As required by the
provisions of the Companies Act, 2013, their appointment should be
ratified by members each year at the AGM. Accordingly, requisite
resolution forms part of the notice convening the AGM.
A Secretarial Audit was conducted during the year by the secretarial
Auditor, Mr. V. Chandramowli, Practicing Company Secretary in
accordance with provisions of section 204 of the Companies Act, 2013.
The Secretarial Audit Report is attached as Annexure 4 and forms a part
of the report of the Directors.
Cost Audit is not applicable to the Company for the financial year
EXPLANATION / COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE
REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND THE PRACTICING COMPANY
SECRETARY IN THEIR REPORTS.
The comments made by the Auditors in their report have been duly
explained in the attached Notes on Accounts. (Note No. 1(I))
The Company, in order to comply with the requirement of Clause 49(II)
(A) (1) of Listing Agreement , regarding appointment of woman director
has sent an invitation letter to Ms. Lakshika Mehta to join the Board of
Company on March 2, 2015. Ms. Lakshika Mehta has also sent a letter
dated March 16, 2015 accepting the invitation to join the board. The
Board in the meeting held on May 22, 2015 has appointed Ms. Lakshika
Mehta as an additional Director in terms of Section 161 of the Companies
act, 2013 in the category of Independent Director. Her appointment as
independent director is placed before the Members for approval under
Item 6 of the accompanying notice.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES:
The Company does not have any Subsidiary or Joint venture Company. The
Company, Munoth Neg Wind Farm(P) Ltd ceased to be associate during the
financial year 2014-15. As per exception provided under Rule 6 of the
Companies (Accounts) Rules, 2014 (Notification G.S.R. 723(E) dated
14.10.2014). a company having no subsidiaries but having only
associate company(ies) and/or joint venture(s) is exempted from
consolidation of financial statement in respect of associate
company(ies) and/or joint venture(s) for the financial year commencing
on or after 01.04.2014 and ending before 31.03.2015. The nil disclosure
in Form No. AOC 1 is enclosed as Annexure 5.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
In line with the requirements of the Companies act, 2013 and equity
listing agreement, the Company has formulated a policy on Related Party
transactions which is also available on Company''s website at
www.munothfinancial.com. The policy intends to ensure that proper
reporting, approval and disclosure procedures are in place for all
transactions between the Company and Related Parties.
All Related Party transactions are placed before the Audit Committee
for review and approval, Prior omnibus approval is obtained for Related
Party transactions on a quarterly basis for transactions which are of
repetitive nature and / or entered in the Ordinary Course of Business
and are at Arm''s Length.
There is no materially significant related party transactions which
exceeds 10% of the consolidated turnover of the Company. The nil
disclosure in Form No . AOC.2 is enclosed as Annexure 6
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURE:
There are no persons employed in the Company during the year or for
part of the year who were in receipt of remuneration in excess of the
limits set out in Rules 5(2) and 5(3) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 read with in terms of
provisions of Section 197(12) of the Companies Act, 2013.
Disclosures pertaining to remuneration and other details as required
under Section 197(12) of the Act read with Rule 5(1) of the Companies
(Appointment and Remuneration of Managerial Personnel) rules, 2014 are
provided in the Annual Report as Annexure 7
In terms of Section 136 of the Act, the reports and accounts are being
sent to the members and others entitled thereto, which is available for
inspection by the members at the registered office of the company
during business hours on working days of the company. If any member is
interested in inspecting the same, such member may write to the Company
in advance and the same will be furnished. The full annual report is
also available on the Company''s website.
The Vigil Mechanism of the Company, which also incorporates a whistle
blower policy in terms of the Listing Agreement, includes an Ethics &
Compliance Task Force comprising Senior Executives of the Company. The
policy on vigil mechanism and whistle blower policy may be accessed on
the company''s website www.munothfinancial.com
A report on Corporate Governance along with the Auditor''s Certificate
regarding compliance of the conditions of Corporate Governance and also
a Management Discussion and Analysis Report pursuant to Clause 49 of the
Listing Agreement are annexed hereto. The Auditor''s have certified the
Company''s Compliance of the requirements of Corporate Governance in
terms of the Listing Agreement and the same is enclosed to the Corporate
NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW:
The Company has conducted 5 Board meetings during the financial year
under review. The details regarding the Board Meetings, Audit Committee
Meetings, Nomination and Remuneration Committee meeting etc., are given
separately in the Corporate Governance Report .
The Audit Committee comprises of Independent Directors namely Mr. Ajit
Kumbhat (Chairman) , Mr. M Jayantilal Jain and Mr. Mah Sau Cheong as
Members. All the recommendations made by the Audit Committee were
accepted by the Board
The Company''s shares are listed on The Stock Exchange, Mumbai.
PREVENTION OF INSIDER TRADING:
The Company has adopted a Code of Conduct as per the Guidelines issued
by the Securities and Exchange Board of India for prevention of Insider
Trading with a view to regulate trading in securities by the Directors
and designated employees of the Company. The Board of Directors and the
designated employees have confirmed compliance with the code.
Your Directors state that no disclosure or reporting is required in
respect of the following items as there were no transactions on these
items during the year under review.
1. Issue of equity shares with differential rights as to dividend,
voting or otherwise
2. Issue of shares ( including sweat equity shares) to employees of
the company and ESOS under any scheme
3. The company does not have any subsidiaries and hence the disclosure
stating that the Managing Director / whole Time Director of the Company
not receiving any remuneration or commission for subsidiary is not
4. No significant or material orders were passed by the Regulators or
Courts or Tribunals which impact the going concern status and Company''s
operations in future.
5. There were no cases filed pusuant to the Sexual Harassment of Women
at Workplace ( Prevention, Prohibition and Redressal) Act, 2013.
Your Directors would like to express their gratitude to the
Shareholders, vendors, bankers and customers for their support and
co-operation. They wish to thank all the employees of the Company for
their sincere and dedicated services.
For and on behalf of the Board of Directors
Chennai LALCHAND MUNOTH
May 22, 2015 CHAIRMAN