DIRECTORS' REPORT To The Members, The Directors of the Company take pleasure in presenting their Twenty Second Annual Report with the annual audited financial statements for the financial year ended on 31st March 2015. DIVIDEND Your Directors do not recommend Equity dividend for the year ended 31st March, 2015 to conserve the resources. RESULTS OF OPERATIONS The consolidated income of Khandwala Securities Limited stood at Rs. 506.85 lacs for the financial year ended March 31, 2015 as against Rs. 438.18 lacs for the previous year. The Company made a net profit of Rs. 25.10 lacs for the financial year ended March 31, 2015 as compared to a net loss of Rs. 27.82 lacs in the previous year. The detailed information on operational and financial performance, etc, is also given in the Management Discussion and Analysis Report which is annexed to the Directors' Report and has been prepared in compliance with the terms of Clause 49 of the Listing Agreement with the Indian Stock Exchanges. SHARE CAPITAL The paid up Equity Share Capital as at March 31, 2015 stood at Rs 119,390,000. During the year under review, the Company has neither issued any shares with differential voting rights nor had granted any stock options or sweat equity. LISTING WITH STOCK EXCHANGES The equity shares of the Company are listed on National Stock of India Limited and Bombay Stock Exchange Limited. SUBSIDIARIES AND JOINT VENTURES Your company does not have any subsidiary company or joint venture. ASSOCIATE COMPANIES As at March 31, 2015 Khandwala Securities Limited has Trumonee Financial Limited as an associate company as mentioned in notes to accounts. EXTRACT OF ANNUAL RETURN As provided under section 92(3) of Companies Act, 2013 the extract of annual return is given as "Annexure 1'' in the prescribed form MGT-9, which forms part of this report. DIRECTORS 1. Mr Brijmohan Rai Bahl, Senior Director of Khandwala Securities Limited, passed away on January 24, 2015 due to cardiac arrest. The Board placed on record the immense contribution made by Mr. Bahl to the deliberations of the Board. Thus Mr. Brijmohan Rai Bahl ceases to be a director with effect from the resolution passed in the meeting of Board of Directors held on February 06, 2015. 2. Mr. Paresh Khandwala was re-appointed as Managing Director of the Company in accordance with the provisions of Sections 196,197 and 203 read with Schedule V and all other applicable provisions of the Companies Act, 2013 and the Companies (Appointment and remuneration of Managerial Personnel) Rules, 2014 in the Board meeting held on November 14, 2014 for a period of 3 years, subject to the approval from shareholders of the Company in the Annual General Meeting. We seek your support in confirming the appointment of Mr. Paresh Khandwala as Managing Director in the ensuing Annual General Meeting of the Company. 3. Mr. Pranav Khandwala was appointed as Chief Financial Officer (CFO) of the Company pursuant to Section 203 of Companies Act, read with rule 8 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. 4. Mrs. Bhagyashree Khandwala shall retire at the ensuing Annual General Meeting and being eligible offers herself for re-appointment. 5. Mr. Homiar Vakil will retire at the ensuing Annual General Meeting and being eligible offers himself for re-appointment. The Board recommends their re-appointment. The Companies Act, 2013, provides for the appointment of Independent Director. Sub-section (10) of Section 149 of the Companies Act, 2013 provides that Independent Director shall hold office for a term of up to five consecutive years on the Board of the Company and shall be eligible for re-appointment on passing of a special resolution by the shareholders of the Company. Accordingly the Company has received a notice in writing under Section 160 of the Companies Act, 2013 from a member proposing his candidature for the office of Director, to be as an Independent Director of the Company to hold office for a term upto 5 (Five) consecutive years commencing from September 19, 2015. We seek your support in confirming the appointment of Mr. Homiar Vakil in the ensuing Annual General Meeting of the Company. BOARD INDEPENDENCE The Company has received Declarations of Independence pursuant to clause 49 of the Listing Agreement and section 149 (6) of the Companies Act, 2013 from all the Independent Directors . NUMBER OF MEETINGS OF THE BOARD The Board of Directors met four times during the Financial Year 2015. The meetings were held during the year on May 30, 2014, August 01, 2014, November 14, 2014 and February 06, 2015. The details of the Board Committee Meetings and attendance of the Directors at the Board / Committee meetings are given in the Corporate Governance Report. BOARD EVALUATION Pursuant to the provisions of the Companies act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of the Board. The manner in which the evaluation was carried out has been explained in the Corporate Governance Report. DIRECTOR'S RESPONSIBILITY STATEMENT To the best of their knowledge and belief and according to the information and explanations, obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of Companies Act, 2013: (i) in the preparation of the Annual Accounts for the year ended 31st March, 2015, the applicable Accounting Standards have been followed along with proper explanations relating to material departures, if any; (ii) that such accounting policies as mentioned in the notes to accounts have been selected and applied consistently and judgments and estimates have been made 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 the year ended March 31, 2015; (iii) proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (iv) that the Annual accounts are prepared on a going concern basis. (v) that proper internal financial controls were in place and that the internal financial controls were adequate and were operating effectively; and (v) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and were operating effectively. RISK MANAGEMENT & INTERNAL CONTROL SYSTEMS The Company has an adequate system of internal controls commensurate with the nature of business and complexity of its operations to ensure accuracy of accountancy records, compliance with all laws and regulations, processes and guidelines prescribed by the management. An extensive Internal audit is carried out by Shah & Ramaiya, independent firm of Chartered Accountants. Post audit reviews are also carried to ensure follow up on the observations made. Details of internal finance control and its adequacy are included in the Management Discussion and Analysis Report, which forms a part of this report. RELATED PARTY TRANSACTIONS All Related Party Transactions that were entered during the financial year were on a arm's length basis and were in the ordinary course of business. Thus disclosure in form AOC-2 is not required. Further, there are no material related party transactions during the year under review with the Promoters, Directors or Key Managerial Personnel. The disclosure with related parties is set out in the notes to accounts forming part of annual report. PARTICULARS OF LOAN, GUARANTEES AND INVESTMENTS BY COMPANY During the financial year ended March 31, 2015, no loan, guarantee and investment under Section 186 of the Companies Act, 2013 was made by the Company. KEY MANAGERIAL PERSONNEL Pursuant to Section 203 of Companies Act, 2013 the Company has designated Mr. Pranav Khandwala as Chief Financial Officer (CFO) of the Company. MANAGEMENT DISCUSSION AND ANALYSIS The Management Discussion and Analysis Report for the year under review as required under Clause 49 of the Listing Agreement, is given as a separate statement in the annual report. EMPLOYEES Your Company is consciously aware that its well being largely depends upon the quality and strength of human resource. Your Company recognizes that Human Capital is its most valuable asset and thus endeavors to attract and retain the best available talent. Towards the end of FY2015 your Company undertook an exercise to shrink the payroll head count to make it lean and more competitive. The Company through constant monitoring of its milestones and goals ensures that its operations are adequately staffed and in sync with requirements. Your Company's human resource policies are designed and implemented to achieve these objectives. The Board wishes to place on record its appreciation for sincere and dedicated efforts put in by all the employees. Employee-Management relations continued to remain cordial throughout the year under review. 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. REMUNERATION POLICY The remuneration paid to the Directors and the Senior Management is as per the recommendation of the Nomination and Remuneration Committee. POLICY FOR PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE The Company has adopted a policy for Prevention Of Sexual Harassment of Women at Workplace under the provisions of the Sexual Harassment of at Workplace (Prevention, Prohibition, and Redressal) Act, 2013("Act").The objective of this policy is to provide protection against Sexual Harassment of Women at Workplace and for redressal of complaints of any such harassment. During the year no complaints were received by the Company. VIGIL MECHANISM/WHISTER BLOWER POLICY The Company has adopted a Whistle Blower Policy for employees to report instances of unethical behaviour, actual or suspected fraud or violation of the Company's Code of Conduct. The details of the Whistle Blower Policy is explained in the Corporate Governance Report and also posted on the website of the Company. CODE OF CONDUCT Securities Exchange Board of India (Prohibition of Insider Trading), Regulations 2015 has been gazetted on 15th January, 2015 and came into force with effect from 15th May, 2015. It replaces the Regulations of 1992 which was amended in 2002. These regulations are applicable for listed entities. The Code of Conduct of Khandwala Securities Limited is revised as stated in Chapter IV Code of Fair Disclosure and Conduct of SEBI (Prohibition of Insider Trading )Regulations, 2015. Accordingly, the company has adopted the revised code of conduct also posted on the website of the Company. STATUTORY AUDITORS M/s. Udyen Jain & Associates, Chartered Accountants, who are the Statutory Auditors of the Company, hold office till the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. The Company has received letters from them to the effect that their re-appointment, if made, would be within the prescribed limits under section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified for re-appointment. Observations made by the Auditors in their Report, have been appropriately dealt with in the notes forming part of the accounts for the year, which are self-explanatory and therefore do not call for any further comments. SECRETARIAL AUDIT The Company has appointed M/s Bhuwnesh Bansal & Associates, Company Secretary in Practice, as Secretarial Auditor of the Company pursuant to the provisions of Section 204 (1) of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and Remuneration personnel) Rules, 2014. The Secretarial Audit report is annexed herewith as Annexure 2. INTERNAL AUDIT Pursuant to Section 138 of Companies Act, 2013 read with Rule 13 of the Companies (Accounts) Rules, 2014 (including any statutory modification(s) or re-enactment thereof for the time being in force), and on recommendation of the Audit Committee, Shah & Ramaiya, Chartered Accountants, are appointed as Internal Auditors of the Company. The Company has regular checks through internal audit periodically. CORPORATE GOVERNANCE Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, a report on Corporate Governance along with Management Discussion and Analysis and Auditor's Certificate on compliance with Corporate Governance requirements have been included in this Annual Report as separate sections. CORPORATE SOCIAL RESPONSIBILITY As per the provisions of Section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility) Rules, 2014, your Company is not required to comply with CSR norms as per the threshold norms. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURT There are no significant and material orders passed by the regulators or Courts that would impact the going concern status of the Company and its future operations. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO Since the company does not own any manufacturing facility, conservation of energy and technology absorption particulars in the Companies (Accounts) Rules, 2014, are not applicable. (i) Foreign Exchange Earnings and Outgo: Foreign Exchange Earned - NIL Foreign Exchange Used - Rs. 1.49 Lacs DEPOSITS Your Company has not accepted any deposits from the public and, as such, no amount of principal or interest was outstanding as of the balance sheet date. ACKNOWLEDGMENTS The Board expresses its sincere gratitude for the continued support and guidance received by the Company from the Securities and Exchange Board of India, the Stock Exchanges and other government and regulatory agencies. The Board would like to acknowledge the continued support of its bankers, registrars, vendors, clients and investors. The Directors also wish to place on record their gratitude and appreciation of the employees' hard work, dedication, teamwork and professionalism which has made the phenomenal growth possible year after year. For and on behalf of the Board of Directors Khandwala Securities Limited S M Parande Chairman Date: 26th May, 2015 Place: Mumbai. |