| Dear Members,
The Directors present the 26th Annual Report and the Audited Accounts
for the Financial Year ended 31st March 2015.
Financial Results
The Financial performance of the Company for the Financial Year ended
31st March, 2015 is summarized below:
(Rs in Lacs)
Particulars Year Ended Year Ended
31.03.2015 31.03.2014
Total Revenue 502.47 325.44
Profit before Interest, Depreciation & Tax 144.90 52.54
Profit before Depreciation and Tax 144.77 52.29
Depreciation 15.33 13.67
Profit Before Tax 129.24 38.62
Less: Provision for Tax (Net) 12.94 1.11
Profit After Tax 116.30 37.51
Add: Balance Brought Forward from the last year 1008.99 1004.49
Profit available for Appropriation 1125.29 1042.00
Appropriations:
Proposed Equity Dividend 25.00 25.00
Tax on Dividend 5.00 4.25
Transfer to General Reserve 11.65 3.76
Balance carried forward to Balance sheet 1083.64 1008.99
Total Appropriations 1125.29 1042.00
The Company's Profit after Tax is Rs. 116.30 Lacs (Previous Year Rs.
37.51 Lacs). The Board recommends transfer of a sum of Rs. 11.65 Lacs
(Previous Year Rs. 3.76 Lacs) to General Reserve.
DIVIDEND
Your Directors are pleased to recommend the payment of dividend on
equity shares @ Rs. 0.50 per share for the financial year ending
31-03-2015. The total dividend together with tax and surcharge there on
amount to Rs.30.00 Lacs (Previous year Rs. 29.25 Lacs).
MARKET SCENARIO
The Financial Market was mainly positive during the FY 2014-15 as the
markets were buoyed up by a lot of factors that turned positive. The
fact that most Financial Markets across the globe have been doing well
over the past few quarters, despite several challenging head-winds,
helped our markets remain cheerful for the better part of the financial
year under review.
Our own internal factors have been quite significant too, in keeping
our markets very buoyant in the recent times. The induction of the BJP
led NDA Government, being voted to power with an absolute mandate has
been the most influential factor in helping our Financial & Capital
Markets returning to buoyant times after almost 4 years of prolonged,
struggling times. The Markets really made historic moves as the lead
Indices on the D-Street galloped to new life-time highs, creating
wealth for all types of Investors. The FY 2014-15 will be remembered in
the annals of stock markets' history as an rewarding one!
CHALLENGES REMAIN
Despite the optically visible rosy picture the markets' path is froth
with stern challenges from various Domestic as well Global quarters.
Firstly, the very basic Fundamentals with regard to the Economy
continue to see several headwinds. The very basic growth factors,
measured in terms of GDP numbers remain subdued at barely above the 6%
mark while the desired levels of 8% remain distantly evasive. The
Inflation levels have cooled off but the Core Inflation levels on the
Consumer Index still is not comforting enough for the RBI to trigger
aggressive growth measures like slashing Repo- Rates.
Some other functional deficiencies in Administrative issues & certain
Contentious Taxation Issues have also been spooking the markets at
regular intervals. The Retrospective Taxation issues that made debut in
2012 in the form of GAAR & has, somehow, lingered around ever since,
has cropped again in the form of MAT claims on certain FIIs, resulting
in an air of despondency amongst the FII fraternity, extending the list
of serious market concerns. As such, the worries posed by the Natural
factors like the probability of a poor Monsoon & the continued stress
levels of the Rural Economy were causing serious enough concerns &
hurting the markets' sentiments adversely.
Despite the record levels of FOREX Reserves that can boast, the
Cross-Currency fluctuations continue to hurt broader interests & is not
entirely insulated from the periodic jolts. The anomaly created by the
Currency moves is constantly hurting the Exporters (due to weaker
Currencies of competing nations) on one hand while the weakening Rupee
is threatening the prospective FDI & FII Inflows from developed
Economic geographies. Thus, the predicaments of the Finance Ministry
are getting accentuated, making them progress cautiously in pursing
certain key Economic Reforms. However, the Government's efforts to push
through the Reform process, overcoming the legislative hurdles, can be
viewed in a positive light.
MARKET MOOD - COUTIOUSLY OPTIMISTIC
Despite the overwhelming list of concerns & niggling worries, our
markets present a picture of cautious optimism. Of course, the euphoric
fervor of the earlier quarters of this Financial Year have subsided
considerably. Despite the fact that the leading Indices the NIFTY &
SENSEX hit lofty levels at 9100 & 30K respectively, recorded in the
first week of March, the events over the next couple of months has
resulted in bringing these major Indices into a negative territory for
the Calendar Year 2015. Indian Markets slipped into the red even as
most leading Global Markets were progressing handsomely, hitting either
life-time Highs of multi-Decade Highest levels. This slump had been
triggered NOT due to the Economic issues but more due to the external
factors that are in the control of certain powers that be.
Despite all these hassles, the Financial Streets do believe that it is
just a matter of time before we get our act together. Also, the
feeling that the Economy shall pick up pace in the due course is seldom
lost amongst the players' fraternity. The Long term growth
fundamentals of our Economy & the remarkably high levels of
entrepreneurship spirits of our Corporate Entities is unquestionably
liked by most leading Global Institutional Investors. The remarkable
maturity displayed by our Domestic Institutions in recent times can be
seen as a hugely positive take-away. Even the Mutual Fund fraternity
seems to be now enjoying the confidence of a much larger sections of
retail Investors. The role of MF's in the coming up times is most
likely to be much more valuable. The outlook for the markets is
certainly positive, even if a bit cautiously.
SHARE CAPITAL
During the Financial Year 2014-15, the share capital of the Company has
remained unchanged
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return, in format
MGT -9, for the Financial Year 2014-15 has been enclosed with this
report.
NUMBER OF BOARD MEETINGS
The Details of the number of meetings of the Board held during the
Financial Year 2014-15 forms part of the Corporate Governance Report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of Section 152 of the Companies Act
2013 Shri K K Maheshwari and Shri Piyush Modi, retires by rotation at
the ensuing Annual General Meeting and being eligible offer themselves
for reappointment.
During the year the following directors have resigned w.e.f the closure
of business hours of 07.02.2015:
1. Shri M P Murhy
2. Shri V.B.Purnaiah
3. Shri Ram Nivas Joshi
Your Directors place on record their appreciation of the valuable
contribution made by the retired directors of your Company.
Shri Budhi Prakash Toshniwal has been appointed as the Additional
Director of the Company w.e.f 07.02.2015. His appointment has been
ratified in the EGM held on 23rd March, 2015
The Board on 7th Feb, 2015 appointed Shri Govind Toshniwal, as Company
Secretary of the Company.
The Members of the Company on 23rd March, 2015 appointed Shri A K
Inani, Director Finance of the Company as CFO of the Company.
POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION
(including criteria for determining qualification, positive attributes,
independence of a director, policy relating to remuneration for
Directors, Key Managerial Personnel and other employees)
Policy on Directors Appointment
Policy on Directors appointment is to follow the criteria as laid down
under the Companies Act, 2013 and the listing agreement with Stock
Exchanges and good corporate practices. Emphasis is given to persons
from diverse fields or professions.
Policy on Remuneration
Guiding Policy on remuneration of Directors, Key Managerial Personnel
and employees of the Company is that -
- Remuneration to Key Managerial Personnel, Senior Executives, Managers
and staff is industry driven in which it is operating taking into
account the performance leverage and factors such as to attract and
retain quality talent.
- For Directors, it is based on the shareholders resolutions,
provisions of the Companies Act, 2013 and Rules framed therein,
circulars and guidelines issued by Central Government and other
authorities from time to time.
ANNUAL EVALUATION BY THE BOARD OF ITS OWN PERFORMANCE, ITS COMMITTEES
AND INDIVIDUAL DIRECTORS
The Board of Directors of the Company has initiated and put in place
evaluation of its own performance, its committees and individual
directors. The result of the evaluation is satisfactory and adequate
and meets the requirement of the Company.
DECLARATION OF INDEPENDENCE BY THE INDEPENDENT DIRECTORS
Pursuant to Section 149(6) of the Companies Act, 2013, Independent
Directors of the Company have made a declaration confirming the
compliance of the conditions of the Independence stipulated in the
aforesaid section
REMUNERATION RATIO OF THE DIRECTOS / KEY MANAGERIAL PERSONNEL
The information required pursuant to Section 197 read with rule 5 of
the Companies (Appointment and Remuneration) Rules, 2014 and Companies
(Particulars of Employees) Rules 1975, in respect of employees of the
Company and Directors is furnished hereunder:
A) Ratio of remuneration of each Director to the median remuneration of
all the employees of your Company for the Financial Year 2014-15 as
follows:
S.
No Name Remuneration
Paid in the Ratio / Times
per Median
FY 2014-15 in Rs. of employee
remuneration
1 Shri Krishna Kumar Maheshwari 13,97,886/- 6.33
2 Shri Piyush Modi 6,00,000/- 2.72
3 Shri Ashok Kumar Inani 9,42,464/- 4.27
The aforesaid details are calculated on the basis of remuneration for
the financial year 2014-15. Median remuneration of the Company for all
its employees is Rs 220667/- for the Financial Year 2014-15.
B. Details of percentage increase in the remuneration of each Director
and CFO and Company Secretary in the Financial Year 2014-15 are as
follows:
Name Designation Remuneration in Rs. Increase %
2014-15 2013-14
Shri Krishna Kumar
Maheshwari Managing
Director 13,97,886/- 13,95,152/- 0.20
Shri Piyush Modi Whole Time
Director 6,00,000/- 6,00,000/- 0.00
Shri Ashok Kumar
Inani Director
Finance/ CFO 9,42,464/- 8,99,343/- 4.80
Shri Govind
Toshniwal Company
Secretary 67,002/- NA NA*
The remuneration to Directors is within the overall limits approved by
the shareholders.
* For part of the current year only
C. Percentage increase in the median remuneration of all employees in
the financial year 2014-15:
Particulars 2014-15 2013-14 Increase /
(decrease)%
Median remuneration of all Rs. 220667/- Rs. 234918/- (6.06)
employees per annum
D. Number of permanent employees on the rolls of the Company as on
31st March, 2015 are 26 and as on 31st March, 2014 are 28.
E. Explanation on the relationship between average increase in
remuneration and Company performance:
The Increase in average remuneration of all employees in the financial
year 2014-15 as compared to the financial year 2013- 14 was 11.67%.
The Key indices of Company's performance is as follows:
Amount in Lacs
Particulars 2014-15 2013-14 Growth %
Net Revenue from operations 502.47 325.44 54.40
Profit Before Tax and exceptional itmes 129.24 38.62 234.64
Profit After Tax 116.30 37.51 210.05
Your Company is committed in ensuring fair pay and a healthy work
environment for all its employees. Your Company offers competitive
compensation to its employees. The pay also incorporates external
factors like cost of living to maintain concurrence with the
environment. Internal equity is ensured by appropriate fitment at the
time of the employee joining a particular cadre and grade. The fixed
pay for an employee depends on his/ her performance against the
objectives set for the year.
Thus, there will be a positive correlation in the increase in
remuneration of employees and your Company's performance, however, a
perfect correlation will not be visible given the dependency on the
other factors.
F. Comparison of the remuneration of the Key Managerial Personnel
against the performance of your Company:
The remuneration of Key Managerial Personnel increased by around 3.75%
in 2014-15, compared to 2013-14, whereas the Profit Before Tax and
exceptional items increased by 234.64% in 2014-15, compared to 2013-14.
G. Details of Share price and market capitalization:
The details of variation in the market capitalization and price
earnings ratio as at the closing date of the current and previous
financial years are as follows:
Particulars As on 31st
March 2015 As on 31st
March 2014 Increase /
Decrease %
Price Earnings ratio 14.14 9.36 51.09
Market Capitalisation
(in Crores) 8.20 4.01 104.49
Comparison of share price at the time of first public offer and market
price of the share of 31st March, 2015:
Market Price as on 31st March, 2015 16.40
Price at the time of initial public offer in 1995 10.00
% increase of Market price over the prices
at the time of initial public offer 64
Closing share price on BSE has been used for the above tables.
H. Comparison of average percentage increase in salary of employees
other than the key managerial personnel and the percentage increase in
the key managerial remuneration:
Particulars 2014-15 2013-14 Increase %
Average Salary of all the
Employees (Other than KMP) 3,11,513/- 2,19,255/- 42.01
Salary of Key Managerial
Personnel Managing Director 13,97,886/- 13,95,152 0.20
Whole Time Director 6,00,000/- 6,00,000/- 0.00
Director Finance / CFO 9,42,464/- 8,99,343/- 4.80
Company Secretary 67,002/- - NA
The increase in remunerations of employees other than the managerial
personnel is in line with increase in remuneration of managerial
personnel
I. Key parameters for the variable component of remuneration paid to
the Directors:
The key parameters for the variable component of remuneration to the
Directors are decided by the Nomination and Remuneration Committee in
accordance with the principles laid down in the Nomination and
Remuneration Policy.
J. There are no employees of the Company who receive remuneration in
excess of the highest paid Director of the Company.
K. Affirmation:
Pursuant to Rule 5(1)(xii) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, it is affirmed that
the remuneration paid to the Directors, Key Managerial Personnel and
senior management is as per the Remuneration Policy of the Company.
REPLY TO AUDITOR'S OBSERVATIONS:
STATUTORY AUDITOR'S REPORT
The observations made in the Statutory Auditor's Report, read together
with the relevant notes thereon are self explanatory and hence, do not
call for any comments.
SECRETARIAL AUDITOR'S REPORT
1) Appointment of KMP as per Companies Act, 2013 was complied within
the Financial Year after identification of proper person by the Board.
2) Considering broad based circulation of information through stock
exchange, these were intimated within the stipulated time frame.
However the board has noted for other regulatory requirements
STATUTORY AUDITORS
M/s. Ramkishore Jhawar & Associates, Statutory Auditors of the Company
hold office until the conclusion of 28th Annual General Meeting. The
Company has received a letter from them to the effect that their
appointment, if made, would be within the prescribed limits under
Section 141(3)(g) of Companies Act, 2013. Accordingly the said Auditors
can be reappointed as Statutory Auditors of the Company at the ensuing
Annual General Meeting.
INTERNAL AUDIT
Raju and Prasad, Chartered Accountants, Hyderabad are the internal
auditors of the Company.
SECRETARIAL AUDIT
According to the provisions of section 204 of the Companies Act, 2013
read with Rule 9 of the Companies(Appointment and Remuneration of
Managerial Personnel) Rules, 2014, the Secretarial Audit Report
submitted by Company Secretary in Practice is enclosed as a part of
this report
WHISTLE BLOWER / VIGIL MECHANISM POLICY
In pursuance to the provisions of section 177 of the Companies Act,
2013 and clause 49 of the Listing Agreement, a Vigil Mechanism for
Directors and Employees to report genuine concerns has been
established. The Policy has been uploaded on the website of the
Company.
RELATED PARTY TRANSACTIONS
Related Party transactions that were entered during the Financial Year
were on an Arm's Length Basis and were in the Ordinary Course of
Business. There were no materially significant related party
transactions with the Company's Promoters, Directors, Management and
their relative, which could have had a potential conflict with the
interests of the Company. Transactions with related parties entered by
the Company in the normal course of business are periodically placed
before the Audit Committee for its omnibus approval.
The Board of Directors of the Company has, on the recommendation of the
Audit Committee, adopted a policy to regulate transactions between the
Company and its Related Parties, in compliance with the applicable
provisions of the Companies Act. 2013 and rules thereunder and the
Listing Agreement. This policy was considered and approved by the Board
and has been uploaded on the website of the Company.
PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN, AND
SECURITIES PROVIDED
The Company has not given loans, guarantee or provided securities.
However, particulars of investments made is provided in Notes to
Financial Statements in Note no. 9.
LISTING ARRANGEMENTS
The Company's shares are listed on BSE LIMITED.
The Company has paid up to date annual listing fee of the Stock
Exchange
PUBLIC DEPOSITS
During the year under review the Company has not accepted any public
deposits.
INTERNAL COMPLAINTS COMMITTEE
The Company has formed Internal Complaints Committee as per the
provision of Sexual Harassment Act (The Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013, wherein it
mandates for every workplace and every employer in charge of a work
place with more than 10 workers to constitute an Internal Complaints
Committee as prescribed under the Act, for receiving complaints of
sexual harassment.
The Company has not received any complaints
DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS :
Your Company has well established procedures for internal control
across its various locations, commensurate with its size and
operations. The organization is adequately staffed with qualified and
experienced personnel for implementing and monitoring the internal
control environment. The internal audit function is adequately
resourced commensurate with the operations of the Company and reports
to the Audit Committee of the Board.
INSURANCE
Adequate Insurance cover has been taken for properties of the Company
including Buildings, Computers, Office Equipments, Vehicles, etc.
STATUTORY INFORMATION
Particulars of Conservation of Energy, Technology Absorption and
Foreign Exchange Earnings and Outgo, Information under Section
134(3)(m) of the Companies Act, 2013.
The Company is not required to furnish information in Form A under the
head 'Conservation of Energy' under Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988.
The Company uses electric energy for its equipments such as air
conditioners, computer terminals, lighting and utilities in the work
premises. All possible measures have been taken for economic
consumption and to conserve the same. Technologically updated UPS
Systems have also been installed for proper service support.
During the year under review, the Company does not have any Foreign
Exchange earnings however the Company has foreign spendings and
spending are fully reimbursed. Hence is not impacting the Financials.
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 the Stock
Exchanges in India, is presented in a separate section forming part of
the Annual Report.
DIRECTORS RESPONSIBILITY STATEMENT
The Directors' Responsibility Statement referred to in clause (c) of
sub-section (3) of Section 134 of the Companies Act, 2013, shall state
that-
(a) in the preparation of the annual accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures;
(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 end of the financial year and of the profit of
the company for that period;
(c) 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;
(d) the directors had prepared the annual accounts on a going concern
basis; and
(e) the directors, had 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.
CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of Corporate
Governance. Your Directors affirmed to the requirements set out in the
Listing Agreement with the Stock Exchanges and have implemented all the
stipulations prescribed.
The Report on Corporate Governance as stipulated under Clause 49 of the
Listing Agreement with the Stock Exchanges forms part of the Annual
Report.
The requisite certificate from the Auditors of the Company, M/ s
Ramkishore Jhawar & Associates, confirming compliance with the
conditions of Corporate Governance as stipulated under the aforesaid
Clause 49, is annexed to this Report.
A Cash Flow Statement for the Financial Year 2014-15 of the Company is
attached to the Balance Sheet.
DEPOSITORY SYSTEM
The Company's shares are available for trading in depository systems of
both the National Securities Depository Limited (NSDL) and the Central
Depository Services India Limited (CDSL).
As on 15th May, 2015 , a total of 48,61,309 Equity shares of the
Company, which forms 97.23% of the Share Capital of the Company, stands
dematerialized.
DEVELOPMENT AND IMPLEMENTAION OF RISK MANAGEMENT POLICY
The Company has been addressing various risks impacting the Company and
the policy of the Company on risk management is provided in this report
in Management discussions and Analysis.
ACKNOWLEDGEMENT
The Board of Directors wish to place on record its appreciation for the
extended co-operation and assistance rendered to the Company and
acknowledge with gratitude the continued support and cooperation
extended by the investors, clients, business associates and bankers.
The regulatory authorities have also put Indian Capital market on par
with other international Markets. Your Directors also acknowledge the
full fledged cooperation and dedicated efforts put in by the employees
across all levels in the organization and place on record its
appreciation for the services rendered.
By Order of the Board of Directors of
CIL Securities Limited
K.K. Maheshwari A K Inani
Managing Director Director Finance /CFO
DIN:00223241 DIN: 00223069
Registered office
214, Raghava Ratna Towers
Chirag Ali lane, Abids,
Hyderabad-500 001
Place: Hyderabad
Date: 16.05.2015
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