DIRECTORS' REPORT TO THE MEMBERS, Your Directors have pleasure in presenting the 31st Annual Report of your Company together with the Audited Statements of Accounts for the financial year ended March 31, 2015 OVERVIEW OF ECONOMY With India expected to 'turn the corner' on the back of structural reforms, its economy is projected to clock 7 per cent growth in 2015 even as China would see an economic slowdown, says a study. Presenting predictions by its economists for the New Year, global consultancy PwC said India is expected to resume growing at more than 6 per cent after seeing expansion below this level since 2012. "We think 2015 could be the year that India turns the corner, posting growth of around 7 per cent. In the short term, low oil prices are likely to increase GDP growth, ease the pressures of India's high current account deficit and help bring down inflation," PwC said. Regarding the country's medium-term economic prospects, PwC said, 'We think that the February 2015 budget could see India take a step towards implementing new structural reforms which will boost the economy." India's economic growth was below 5 per cent in the last two financial years. The Reserve Bank of India (RBI) forecast the economy to grow at 5.5 per cent in 2014-15 (ending this March) and at 6.3 per cent in next financial year 2015-16. PwC said that even though China is expected to make the biggest contribution to global growth this year, its projected growth rate of 7.2 per cent "would be its slowest since 1990 and its high debt levels pose some downside risks to that main scenario". PERFORMANCE HIGHLIGHTS & OUTLOOK The business environment was improved a bit during the year but lack of demand and increasing existence of Online Portals have affected the entire music industry which laid to decrease in customer demands in the segment of Audio Video CD and in turn has increase the demand of online music through websites. The performance of the company has improved a bit but not to the expectation of the company management. The Company has worked hard to achieve the goal and done satisfactory well in spite of increased challenges and competition. Amid optimism and rising business sentiments, your Company reported a top line growth of around 28% over the previous year. At standalone level, gross revenue from the operations stood at Rs. 50328.95 Lac compared to Rs. 38309.15 Lac for the previous year. PBT Margin remained at Rs. 148.46 Lac in comparison to the last year figure of Rs. 103.18 Lac. Net Profit after extra-ordinary items stood at Rs. 83.69 Lac in comparison to last year figure of Rs. 68.45 Lac. The Company is in to the Business of Music recording, trading of MVAS Software, sale of online music through its music portal and sale of music DVDs at its Stores or through franchises, trading / investment activities Capital Market as well as providing financial assistance by way of providing short term loan. The outlook for the current year is expected to be challenging mainly due to rising competition and invention of new modes of selling its products viz. online selling tools, invention of various computer chip etc. However, your Company is hopeful to grow and to deliver better and better in future. DIVIDEND AND RESERVES Your Directors are pleased to recommend the payment of Dividend for the year ended 31st March 2015 at 5 Paise (Five Paise) per share or 5% (five percent) on face value of Rs. 1/- each, subject to approval of Members at the ensuring Annual General Meeting. During the year under review, sum of Rs. 8.35 Lac were transferred to General Reserve. SHARE CAPITAL The paid up Equity Share Capital as on March 31, 2015 was Rs. 14.4292 Crore. During the year under review, the Company has not issued shares with differential voting rights nor granted stock options nor sweat equity. As on March 31, 2015, none of the Directors and/or Key Managerial Person of the Company hold instruments convertible in to Equity Shares of the Company. ISSUE OF BONUS EQUITY SHARES During the Financial Year, the year the Company has allotted 7.2146 Lac Equity Shares in the ratio of 1:1 to its Members as on record date. FINANCE AND ACCOUNTS Your Company prepares its financial statements in compliance with the requirements the Companies Act, 2013 and the Generally Accepted Accounting Principles (GAAP) in India. The financial statements have been prepared on historical cost basis. The estimates and judgments relating to the financial statements are made on a prudent basis, so as to reflect in a true and fair manner, the form and substance of transactions and reasonably present the Company's state of affairs, profits/(loss) and cash flows for the year ended 31st March 2015. The Company continues to focus on judicious management of its working capital. Receivables, inventories and other working capital parameters were kept under strict check through continuous monitoring. There is no audit qualification in the standalone financial statements by the statutory auditors for the year under review. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS Details of Loans, Guarantees and Investments, if any, covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements. RELATED PARTY TRANSACTIONS All transactions entered into with Related Parties as defined under the Companies Act, 2013 and Clause 49 of the Listing Agreement during the financial year were in the ordinary course of business and on an arm's length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013 thus disclosure in form AOC-2 is not required. There were no materially significant transactions with related parties during the financial year which were in conflict with the interest of the Company. Suitable disclosure as required by the Accounting Standards (AS18) has been made in the notes to the Financial Statements. The policy on Related Party Transactions as approved by the Board is uploaded on the Company's website. SUBSIDIARY COMPANY & ITS PERFORMANCE The Central Government vide General Circular No. 2/2011 dated February 8, 2011 has exempted the holding companies from attaching Annual Accounts and other documents in respect of its subsidiaries to the Annual Report of the holding companies from the financial years ended on or after March 31, 2011. As required vide above Circular, statement in respect of its subsidiaries, giving details of capital, reserves, total assets and liabilities, details of investments, turnover, profit before taxation and proposed dividend is attached to the Consolidated Balance Sheet, Annual accounts of the subsidiary companies and the related detailed information will be made available to the shareholders of the Company, seeking such information and will also be made available for inspection at the Registered Office of the Company. The policy on material Subsidiaries as approved by the Board is uploaded on the Company's website. DOMESTIC SUBSIDIARY M/s. JMD Broadcasting Private Limited (Formerly known as Aalap Performing Network Private Limited), a Subsidiary Company, was incorporated on 17th June 2010 with a motive set up a new channel and to provide uplink facility for the same. The Company has paid advance for its office at Noida (Uttar Pradesh) whereas business is yet to be commenced as License is yet to be approved by Central Government. Further during the year, the Company has earned Gross Revenue of Rs. 6.00 Lac in comparison to last year's revenue of Rs. 11.73 Lac. In term of net income of Rs. 1.34 in comparison to last years' amount of Rs. 2.01 Lac (after the provision of taxation for the year). CONSOLIDATED FINANCIAL STATEMENTS In accordance with AS-21 issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements have been provided in the Annual Report. These Consolidated Financial Reports provide financial information about your Company and its subsidiary company as a single economic entity. The Consolidated Financial Statements forms part of this Annual Report. MANAGEMENT DISCUSSION & ANALYSIS As required by Clause 49 of Listing Agreement, the Management Discussion and Analysis is annexed and forms part of the Directors' Report. MANAGEMENT There is no Change in Management of the Company during the year under review. DIRECTORS During the Year, Mr. Ashok Bothra and Mr. Pawan N. Borad have resigned from the Board w.e.f. 4th December 2014 and 29th March 2015 respectively due to their personal commitments. Your Directors wish to place on record their appreciation for the guidance and inputs provided by both Mr. Ashok Bothra and Mr. Pawan N. Borad during their tenure as Directors of your Company Further, during the Year, Mr. Johar Pal Singh and Mr. Mohit Jhunjhunwala were appointed as Additional Director (Independent) of the Company effective from 11th December 2014 and 14th January 2015 to fill the vacancy caused due to the resignation of Mr. Ashok Bothra and Mr. Pawan N. Borad. Further, the Company has appointed Ms. Renu Kedia as Additional Director (Independent) of the Company w.e.f. 4th March 2015 in order to meet the requirements of appointment of Women Director in line with Companies Act, 2013 as well as to comply with Clause 49 of Listing Agreement. Further, none of the Directors of the Company are disqualified under sub-section (2) of Section 164 of the Companies Act, 2013. INDEPENDENT DIRECTORS As per provisions of Section 149 of the 2013 Act, independent directors shall hold office for a term up to five consecutive years on the board of a company, but shall be eligible for re-appointment for another term up to five years on passing of a special resolution by the company and disclosure of such appointment in Board's Report. Further Section 152 of the Act provides that the independent directors shall not be liable to retire by rotation in the Annual General Meeting ('AGM') of the Company. As per Revised Clause 49 of the Listing Agreement (applicable from October 1, 2014), any person who has already served as independent director for five years or more in a company as on October 1, 2014 shall be eligible for appointment, on completion of the present term, for one more term of up to 5 (five) years only. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS, TRIBUNALS OR COURTS There are no significant and material orders passed by the Regulators/Courts that would impact the going concern status of the Company and its future operations. material changes and commitments affecting financial position between the end of the financial year and date of report There have been no material changes and commitments affecting the financial position of the Company between the end of Financial Year and date of the report. DIRECTORS RESPONSIBILITY STATEMENT Pursuant to the provisions of Section 134(5) of the Companies Act, 2013 the Board of Directors confirms that: 1. In the preparation of the annual accounts, for the year ended 31st March 2015, all the applicable accounting standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 have been followed; 2. The Directors had adopted 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; 3. The Directors had 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; and 4. The Directors had prepared the annual accounts on a going concern basis. 5. Proper internal financial controls were in place and that the financial controls were adequate and were operating effectively; and 6. Systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively. information Technology Your Company believes that in addition to progressive thought, it is imperative to invest in Information and Technology to ascertain future exposure and prepare for challenges. In its endeavor to obtain and deliver the best, your Company has tie-ups with an IT solution Company to harness and tap the latest and the best of technology in the world and deploy/absorb technology wherever feasible, relevant and appropriate. business risk management Pursuant to the requirement of Clause 49 of the Listing Agreement, the Company has constituted a Business Risk Management Committee. The details of Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board's Report. The Company has a robust Business Risk Management (BRM) framework to identify, evaluate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on the business objectives and enhance the Company's competitive advantage. The business risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting. The framework has different risk models which help in identifying risks trend, exposure and potential impact analysis at a Company level as also separately for business segments viz. Finance and Capital Market activities. internal control systems and their adequacy The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit (IA) function is defined in the Internal Audit Charter. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board. The Internal Audit Department monitors and evaluates the efficiency and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies. 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 corrective actions thereon are presented to the Audit Committee of the Board. vigil mechanism / whistle blower policy As required under Rule 7 of The Companies (Meetings of Board and its Powers) Rules 2014, the Company has a vigil mechanism named Fraud Risk Management Policy (FRM) to deal with instance of fraud and mismanagement, if any. The detail of the FRM Policy is explained in the Corporate Governance Report. RESEARCH & DEVELOPMENT The Company believes that technological obsolescence is a reality. Only progressive research and development will help us to measure up to future challenges and opportunities. We invest in and encourage continuous innovation. During the year under review, expenditure on research and development is not significant in relation to the nature size of operations of your Company. AUDITORS Statutory Auditors The Auditors M/s Mehta Kothari & Associates, Chartered Accountants, Mumbai who are Statutory Auditors of the Company and holds the office until the conclusion of ensuing Annual General Meeting and are recommended for re-appointment to audit the accounts of the Company from the conclusion of the 31st Annual General Meeting up to the conclusion of the 34th consecutive Annual General Meeting (subject to ratification by the members at every subsequent AGM). As required under the provisions of Section 139 & 142 of the Companies Act, 2013 the Company has obtained written confirmation under Rule 4 of the Companies (Audit and Auditors) Rules, 2014 from M/s. Mehta Kothari & Associates; that they are eligible for appointment as auditors, and are not disqualified for appointment under the Companies Act, 2013, the Chartered Accountants Act, 1949, or the rules and regulations made there-under; the proposed appointment is as per the term and within the limits laid down by or under the authority of the Companies Act, 2013 and that there are no proceedings pending against them or any of their partners with respect to professional conduct. Secretarial Auditors 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 G. S. Bhide & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed elsewhere in this Annual Report. EXTRACT OF ANNUAL RETURN The details forming part of the extract of the Annual Return in form MGT 9, as required under section 92 of the Companies Act, 2013 is annexed elsewhere in this Annual Report. PARTICULARS OF EMPLOYEES The information required pursuant to Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees' particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard. PARTICULARS UNDER SECTION 134(3)(m) OF THE COMPANIES ACT, 2013 Since the Company is into the Business of Music recording, trading of MVAS Software, sale of online music through its music portal and sale of music DVDs at its Stores or through franchises, trading / investment activities Capital Market as well as providing financial assistance by way of providing short term loan; the information regarding conservation of energy, Technology Absorption, Adoption and innovation, under section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is reported to be NIL. FOREIGN EXCHANGE EARNINGS AND OUTGO The Company has not earned or used foreign exchange earnings/outgoings during the year under review. PUBLIC DEPOSITS During the year under review, your Company has not accepted any deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014. REPORT ON CORPORATE GOVERNANCE The Company conforms to the norms of Corporate Governance as envisaged in the Companies Act, 2013 and the Listing Agreement with the BSE Limited. Pursuant to Clause 49 of the Listing Agreement, a Report on the Corporate Governance and the Auditors Certificate on Corporate Governance are annexed to this report. APPRECIATION Your Directors wish to place on record their appreciation towards the contribution of all the employees of the Company and their gratitude to the Company's valued customers, bankers, vendors and members for their continued support and confidence in the Company. Registered Office : Unit No. 323 & 324, 3rd Floor Building No. 9, Laxmi Plaza New Link Road, Andheri (West) Mumbai-400 053 By order of the Board For JMD Ventures Limited Kailash Prasad Purohit (DIN : 01319534) Chairman & Managing Director Place : Mumbai date : May 28, 2015 |