BOARD'S REPORT DEAR SHAREHOLDERS, Your Directors are pleased to present the 21st Annual Report and the Company's audited accounts for the financial year ended March 31, 2015. Results of Operations On a standalone basis, during the year under review, your Company had earned revenue of Rs. 22.97 crores as against Rs. 15.37 crores in the previous year. The expenditure incurred was Rs.15.35 crores as against Rs.16.28 crores in the previous year, resulting in a profit of Rs. 7.54 crores as against of loss Rs. 0.91 crores in previous year. The year ended with a positive outlook as the loss in the previous year has been replaced by profit in the current year. The total consolidated revenue of your Company for the year ended 31st March 2015 was Rs.40.60 crores as against Rs. 31.96 crores in the previous year and the expenditure incurred was Rs. 25 crores against Rs. 32.88 crores in the previous year which resulted in a consolidated profit before taxes of Rs. 15.56 crores as against a loss of Rs. 3.83 crores during the previous year. After tax expense of Rs.2.43 crores and minority interest of Rs.2.81 crores, the consolidated profit for the year stood at Rs. 10.32 crores as against a loss of Rs. 5.67 crores in the previous year. Business Updates During the year under review, the Company, along with its subsidiaries provided a bouquet of services to its clients. The services include equity broking, derivatives trading, commodities derivatives trading, currency derivatives trading, insuranceservices, NBFC products like margin funding, loan against shares, loan against commodities. The Company intends to offer more gamut of service to the clients. Recent updates The Company's online presence is through its portal www. inditrade.com and Mobile App, empowering the clients to trade online across equities, commodities, currencies and mutualfunds. The Company's online clients increased by 15.68% while comparing with the previous year and the revenue generation attained to 31.71% of total revenue. The Company has registered a trademark for it's mobile app -"MTrade - Trade On The Go" Subsidiary Companies Your Directors present herewith a broad overview of the operations and financials of Subsidiaries of your Company: a) Inditrade Derivatives and Commodities Limited Commodity subsidiary, Inditrade Derivatives and Commodities Limited recorded total revenue of Rs. 5.19 crores as against Rs. 7.33 crores during the previous year. The expenditure during the year stood at Rs 5.85 crores, which resulted in a loss of Rs. 0.66 crores as against a loss of Rs. 3.19 crores in the previous year. b) JRG Fincorp Limited NBFC Subsidiary, JRG Fincorp Limited recorded revenue of Rs.12.60 crores as against Rs. 8.17 crores during the previous year. The expenditure during the year stood at Rs. 3.8 crores, which resulted in a profit of Rs. 8.80 crores before tax. The profit after tax for the year stood at Rs. 6.90 crores as against profit of Rs. 2.03 crores during the previous year. c) Inditrade Business Consultants Limited Inditrade Business Consultants Limited, recorded revenue of Rs 0.55 crores as against Rs. 1.52 crores in the previous year. The expenditure during the year stood at Rs 0.51 crores, which resulted in a profit of Rs 0.04 crores before tax. The loss after tax for the year stood at Rs. 0.25 crores as against loss of Rs. 2.62 crores during the previous year. d) Inditrade Insurance Broking Private Limited Inditrade Insurance Broking Private Limited recorded revenue of Rs. 0.22 crores as against Rs. 0.29 crores in the previous year. The total expenditure stood Rs.0.09 crores, which resulted in a profit of Rs. 0.13 crores before tax. The loss after tax stood at Rs. 0.13 crores as against a loss of Rs 0.10 crores in the corresponding previous year. Accounts of Subsidiaries The Company assures that annual accounts of the subsidiary companies and the related detailed information shall be made available to shareholders of the Company and its subsidiary companies seeking such information at any point of time. The annual accounts of the subsidiary companies shall also be kept for inspection by shareholders at the Registered Office of the Company and of the subsidiary companies concerned. The Company shall furnish a hard copy of its details of accounts of subsidiaries to any shareholder on demand. Dividend Board of Directors do not recommend dividend to the shareholders for the financial year 2014-2015 since the surplus is intended to be ploughed back into the business for its future expansion plans. Transfer of Amounts to Investor Education and Protection Fund Pursuant to the provisions of Section 125 of the Companies Act, 2013, relevant amounts which remained unpaid or unclaimed for a period of seven years have been transferred by the Company, from to time to time on due dates, to the Investor Education and Protection Fund. The Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on 4th December 2014 on the Ministry of Corporate Affairs' website. The extract of the Annual Return as provided under sub section (3) of Section 92 of the Companies Act, 2013 in Form No. MGT 9 is attached as Annexure II. Corporate Governance The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements set out by SEBI. The Company has also implemented several best corporate governance practices. The Report on corporate governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report. The requisite certificate from a Practicing Company Secretary firm viz M/s BVR & Associates, Kochi conforming compliance with the conditions of corporate governance as stipulated under the aforesaid Clause 49 is attached as Annexure I to the Report on corporate governance. Directors and Manager Presently the Board of your Company consists of four Directors of which two are Independent Non-Executive Directors, in compliance with Clause 49 of the Listing Agreement with Bombay Stock Exchange Limited. As part of the requirements under Clause 49 of the Listing Agreement, Mr. P Viswanathan (DIN: 00011136),Independent Non Executive Director, is nominated on the Board of JRG Fincorp Limited, Inditrade Derivatives and Commodities Limited and Inditrade Business Consultants Limited, subsidiaries of your Company. Mr. Munish Dayal (DIN: 01683836), director of the Company who retired at the 20th Annual General Meeting of the Company held on 26th September, 2014 was re-appointed as the director of the Company. Ms. Debanshi Basu (DIN: 07135074), has been appointed as the Woman Director of the Company w.e.f. 26th March, 2015 in accordance with Section 149 of the Companies Act, 2013 read with revised Clause 49 of the Listing Agreement subject to the shareholders approval in the ensuing Annual General Meeting of the Company. Mr. Guruswami Raj G who was appointed as the Manager of the Company for a period of 2 years w.e.f 14th March 2014, with the approval of Shareholders in their Annual General Meeting held on 26th September 2014 has resigned from the Company. Consequently Mr. Vinod Mohan has been appointed as Manager of the Company for a period of 2 years w.e.f 11th November 2014 subject to the approval of the Shareholders in their Annual General Meeting. Details of the proposal along with necessary resolutions for the appointment of the aforesaid Director and Manager have been included in the Notice convening the ensuing AGM and Explanatory Statement under Section 102 of the Companies Act, 2013. In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Munish Dayal(DIN: 01683836), Director, retiring by rotation at the ensuing Annual General Meeting is eligible for re-appointment. Employee Stock Option Plan (ESOP) In order to attract and retain talent in the Company, ESOP scheme (JRG ESOP 2008) is in place. This will encourage our employees to participate in the growth of the Company. Disclosure as per the SEBI (Employees Stock Option Scheme and Employees Stock Option Purchase Scheme) Guidelines, 1999 and any amendments thereon is annexed to this report as Annexure I. Fixed deposits During the year, your Company did not accept/renew any deposits within the meaning of Chapter V of the Companies Act, 2013 and the rules made there under. Particulars of employees No employee of the Company was in receipt of remuneration exceeding the amount prescribed under Section 197 of the Companies Act, 2013, read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Management's Discussion and Analysis Report Management's Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement with Bombay Stock Exchange Limited, is presented in a separate section forming part of the Annual Report. Statutory Auditors M/s. Haribhakti & Co. LLP, Chartered Accountants, Chennai, have been appointed as the Statutory Auditors of the Company to hold the office from the conclusion of the 20th Annual General Meeting held on 26th September 2014 till the conclusion of fourth consecutive Annual General Meeting, subject to the ratification of the appointment by the members at every Annual General Meeting subsequently. Information under Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014. (i) The efforts made towards technology absorption; The Company adopted the latest state of-the-art Datacentre, Software and hardware tools available in the market for rendering stock-broking and other services more efficiently and effectively. (ii) The benefits derived like product improvement, cost reduction, product development or import substitution; Implemented Server virtualisation to reduce the server, Power and Management foot print. Implemented the Log management to identify detailed server, Network and application issue and proactively clear them so that it will not affect the trading platform. (iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)- (a) the details of technology imported; Not Applicable (b) the year of import; Not Applicable (c) whether the technology been fully absorbed; Not Applicable (d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof; and Not Applicable (iv) the expenditure incurred on Research and Development No expenditure spent on research and development last year (v) Formal Annual Evaluation has been made in an objective manner by the Board of Directors of its own performance and that of its committees and individual directors at the meeting of the Board of Directors held on 20.05.2015. Other disclosures i. Four meetings of the Board of Directors were held during the year on the following dates viz 27.05.2014, 08.08.2014, 11.11.2014 and 1 1.02.2015. ii. The Company has received declarations from all the Independent Directors of the Company conforming that they meet with the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Companies Act, 2013 and under Clause 49 of the Listing Agreement with Bombay Stock Exchange Limited. iii. The internal financial controls are adequate commensurate with the size and nature of business of the company. iv. The company has framed a Nomination and Remuneration policy which has been approved by the Board of Directors pursuant to Section 178 of the Companies Act, 2013 and Clause 49 of the Listing Agreement which provides the criteria for the appointment and remuneration of directors including Independent Directors, Key Managerial Persons and Senior Management. Nomination and Remuneration Committee has also been constituted. The Nomination and Remuneration Policy is attached as Annexure III. v. There are no qualifications, reservation or adverse remark made by the statutory auditors. vi. Details of loans, guarantees and investments made under Section 186 of the Companies Act, 2013 form part of the notes to the financial statements provided in this annual report. vii. Particulars of contracts or arrangements with related parties referred to in sub section (1) of section 188 in Form No. AOC 2 of the Companies (Accounts) Rules, 2014 is attached as Annexure IV. viii. State of Company's affairs: The services offered by the company include equity broking, derivatives trading, commodities derivatives trading, currency derivatives trading. ix. The company does not propose to transfer any amount to its reserves. x. The company has developed and implemented a risk management policy and the same is available in the website of the company. xi. Pursuant to Section 135 of the Companies Act, 2013 read with Schedule VII, CSR Committee has been constituted. xii. Audit Committee of the Board of Directors consists of three members viz Mr. P Viswanathan, Independent Director, who is also the Chairman along with Mr. B R Menon,independent Director and Mr. Munish Dayal, Director. xiii. The company has established a vigil mechanism for directors and employees pursuant to Section 177(9) of the Companies Act, 2013 and Clause 49 of the Listing Agreement. The vigil mechanism is available in the website of the company in the link: <http://www.inditrade.com/Pdf/Vigil%20Mechanism%20> Whistle%20Blower%20Policy_Inditrade.pdf xiv. Apart from receiving sitting fees by the Independent Directors, none of the directors are receiving any remuneration from the company. xv. There are 141 permanent employees on the rolls of company as at the end of the financial year 2014-15; xvi. Details required to be disclosed under Section 197 of the Companies Act, 2013 is attached as Annexure V. Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 The Company has in place an Anti Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. The following is a summary of sexual harassment complaints received and disposed off during the year 2014-15: ¦ No of complaints received: NIL ¦ No of complaints disposed off: NIL Directors' Responsibility Statement In accordance with the provisions of Section 134 (5) of the Companies Act, 2013, the Board of Directors affirms: (a) That in the preparation of the annual accounts for the year ending March 31, 2015 the applicable Accounting Standards had been followed and there are no material departures. (b) That the accounting policies have been selected and applied consistently and have 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 as on March 31, 2015 and of the profit of the Company for the year ended on that date. (c) That proper and sufficient care was taken 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. (d) That the accounts for the year ended March 31, 2015 was prepared 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 were 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. Secretarial Audit The Secretarial audit report prepared by M/s. SVJS & Associates, Practicing Company Secretaries, Kochi pursuant to Section 204 of the Companies Act, 2013 is attached as Annexure VI. The Auditors have observed that the Board does not have an optimum combination of Executive, Non-Executive and Independent Directors as contemplated under Clause 49 of the Listing Agreement. The matter was duly considered by the Board for taking necessary actions. Acknowledgments Your Directors place on record their sincere appreciation for the assistance and guidance provided by the regulators, stock exchanges, other statutory bodies and Company's bankers for the assistance, cooperation and encouragement extended to the Company. Your Company's employees are instrumental in your Company scaling new heights, year after year. Their commitment and contribution is deeply acknowledged. Your involvement as shareholders is also greatly valued. Your Directors look forward to your continuing support. For and on behalf of the Board P. Viswanathan Chairman Date: 20.05.2015 Place: Gurgaon |