| Dear Shareholders,
The Directors have pleasure in presenting the 21st Annual Report and
the audited accounts of your Company for the financial year ended 31st
March, 2015.
FINANCIAL HIGHLIGHTS
A summary of financial results of the Company and its subsidiaries for
the year ended 31st March, 2015 is given below:-
Standalone Consolidated
Financial Year Financial Year
2014-15 2013-14 2014-15 2013-14
(Rs. in
lakh) (Rs. in (Rs. in
lakh) (Rs. in
lakh)
Particulars lakh)
Total Income 3987.50 2758.77 4445.62 2977.25
Total Expenditure 3575.88 2519.06 3928.18 2717.21
Profit/(Loss) before
Interest, 411.62 239.71 517.44 260.04
Depreciation & Tax
Less: Interest and
Finance Charges 91.63 158.00 139.25 196.20
Less: Depreciation and
Amortisation 46.14 48.09 53.98 58.59
Profit / Loss (-)
Before Tax Before 273.85 33.62 324.21 5.25
Exceptional Item
Exceptional Item - - - 63.60
Profit / Loss (-)
Before Tax 273.85 33.62 324.21 68.85
Less Tax Expenses
-Current Tax 17.05 - 17.08 1.26
-Deferred Tax 66.77 15.66 86.12 22.64
Profit/(Loss) for
the year 190.03 17.96 221.01 44.95
Add: Surplus brought
forward from 1182.49 1176.18 916.55 884.51
previous year
Amount Available for 1372.52 1194.14 1137.56 929.46
Appropriation
Less: Proposed
Dividend on Equity 9.97 9.97 9.97 9.97
Shares
Less: Corporate Tax
on Proposed 2.03 1.69 2.03 1.69
Dividend
Other Adjustment 17.24 - 23.96 1.25
Balance to Balance Sheet 1343.29 1182.48 1101.60 916.55
FINANCIALS OF THE COMPANY ON THE STANDALONE BASIS:
The Statement of Profit and Loss of your Company on standalone basis
shows a profit after tax ofRs.1 190.03 lakhs (Previous Year: Profit
ofRs. 17.96 lakhs). The disposable profit is Rs. 1372.52 lakhs
(Rs.1194.14 lakhs) after taking into account the balance of Rs.1182.49
lakhs (Rs.1176.18 lakhs) brought forward from the previous year.
DIVIDEND
Your Directors are pleased to recommend a dividend at Rs. 0.20 per
equity shares i.e. 2% (Previous year Rs. 0.20, 2%) on par value ofRs.
10/- each for the year ended 31st March, 2015. The dividend, if
approved at the 21st Annual General Meeting (AGM), will be paid to
those shareholders whose name appears on the register of members of the
Company as on 19th September, 2015. The dividend will be tax-free in
the hands of shareholders.
SHARE CAPITAL
The paid up Equity Share Capital as on 31st March, 2015 was Rs.498.87
lacs. There has not been any change in the Equity Share Capital of the
Company during the financial year ended 31st March, 2015. During the
year under review, the Company has neither issued shares with
differential voting rights nor issued sweat equity or granted stock
options.
OPERATIONS:
Lohia Securities Limited (Standalone)
During the financial year 2015, despite the challenging business
environment, the Company reported superior performance.
The standalone revenue for the year was Rs. 3987.50 lakhs as compared
to Rs. 2758.77 lakhs for the year ended 31st March, 2014 resulting in
annualized increase of 44.54%. Operating Profit (Earnings before
interest, depreciation and Corporate tax) for the period ended 31st
March, 2015 was Rs. 411.62 lakhs as againstRs. 239.71 lakhs for the
year ended 31st March 2014 with annualized increase of 71.72%.
The Company has Profit before Tax ofRs. 273.85 lakhs (as compared to
last year's profit ofRs. 33.62 lakhs) after meeting interest expenses
ofRs. 91.63 lakhs (last year's Rs. 158.00 lakhs) and depreciation ofRs.
46.14 Lakhs (last year's Rs. 48.09 lakhs) for the year ended 31st
March, 2015. The Net Profit for the year was Rs. 190.03 lakhs (as
compared to last year's net profit ofRs. 17.96 lakhs). Your Board has
decided not to transfer anything from Profit & loss account to General
Reserve (Previous year -Nil).
Lohia Securities Limited (Consolidated)
The consolidated revenue of the Company for the year was Rs. 4445.62
lakhs, an increase of 49.32% as compared to previous year. There were
increase in the Brokerage Income, Income from operation, Interest
Income, Receipt of DP division and dividend from shares lying as
inventories
The Net Group Profit earned after tax was Rs. 221.01 lakhs as against
profit of Rs.44.95 lakhs of last year.
Summary of Consolidated Financial Results of the company & its
subsidiaries are as below:
Subsidiary/ Joint Venture/ Associate Companies
As on 31st March, 2015, Lohia Securities Limited has four 100%
subsidiaries. Details of their business and operations are given
below:-
Trade City Securities Private Limited has a Trading Membership of NSE
in Capital and F&O Segment and Trading Membership of BSE in Capital and
F&O Segment. It reported a net profit ofRs. 17.89 lakhs compared to
previous year's net profit of Rs.9.51 lakhs.
Trade City Commodities Private Limited is a member of NCDEX, MCX,
National Spot, NCDEX Spot, and ICEX and is engaged in commodity trading
and is registered with FMC. The Company had a net loss after tax ofRs.
4.72 lacs against last year's Net Profit ofRs. 13.93 lakhs.
Trade City Real Estate Private Limited is engaged in property and real
estate business. It is also investing surplus moneys in shares and
securities. The Company has incurred net loss ofRs. 8.36 lakhs compared
to net loss ofRs. 1.42 lakhs of last year.
Trade City Barter Private Limited is a non-banking finance company and
is engaged in investment and financing activities. The Company has
earned a net profit ofRs. 26.16 lakhs compared to last year's net
profit ofRs. 4.96 lakhs.
The Company does not have any joint venture or Associate Company as per
the Companies Act, 2013.
In accordance with Section 129(3) of the Companies Act, 2013 and Clause
32 of the Listing Agreement, the consolidated financial statements of
the Company and all its subsidiary companies have been prepared and
duly audited by the auditors, and form part of the Annual Report. A
statement containing salient features of the financial statements of
the subsidiary is also included in the Annual Report.
The Company will make available the Annual Accounts of the Subsidiary
companies and the related detailed information to any member of the
Company who may be interested in obtaining the same. The annual
accounts of the subsidiary companies will also be kept open for
inspection at the Registered Office of the Company and that of the
respective subsidiary companies. The Consolidated Financial Statements
presented by the Company include the financial results of the
subsidiary companies.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an adequate internal control system commensurate with
the size, scale and complexity of its operations. The internal audit
team monitors and evaluates the efficacy and adequacy of internal
control system in the Company, its compliance with operating system,
accounting procedures and policies at all location of the Company and
its subsidiaries. Based on the reports of internal audit, management
undertakes corrective action in their respective areas and thereby
strengthens the controls. Significant audit observations and corrective
actions thereon are presented to the Audit Committee of the Board.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134(3)(c) read with Section
134(5) of the Companies Act, 2013, with respect to Directors'
Responsibility Statement, your directors hereby confirm that:
i) In the preparation of the annual accounts, applicable accounting
standards have been followed;
ii) appropriate accounting policies have been selected and applied
consistently and estimates and judgments made are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the company as at the end of the financial year and of the profit of
the company for that period:
iii) proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Act have
been taken for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
iv) the annual accounts have been prepared on a going concern basis;
v) Internal financial controls to be followed by the Company have been
laid down and that such internal financial controls are adequate and
were operating effectively; and
vi) proper systems have been devised to ensure compliance with the
provisions of all applicable laws and that such systems were adequate
and operating effectively.
PUBLIC DEPOSITS
The company has not accepted any deposit from the public or from
employees during the year under review.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
At the 20th Annual General Meeting of the Company held on 27th
September, 2014, the members had appointed Mr. Sameer Bajaj (DIN:
00078805) and Mr. Vineet Goenka (DIN: 00079400) as Independent
Directors of the Company under the Companies Act, 2013 each for a term
of five years from the date of that Annual General Meeting.
Mr. Rajesh Kumar Bajaj (DIN: 00080664), Managing Director, though
appointed as the Managing Director for a fixed term of 5 years with
effect from 24th September, 2010, will retire by rotation as a
Director, to enable compliance by the Company with the provisions of
Section 152 of the Companies Act, 2013 and being eligible, has offered
himself for re-appointment at the twenty-first Annual General Meeting.
Your Board is of the opinion that his continued association with the
Board of Directors of the Company will be beneficial to the Company and
hence recommends his re-election.
During the year, the Board of Directors appointed Ms. Sarita Ojha (DIN:
05319371) as an additional director (Independent) of the Company with
effect from March 30, 2015. Ms. Ojha holds office as Additional
Director until the twenty-first Annual General Meeting and is eligible
for appointment as Director of the Company. The Company has received a
notice under section 160 of the Act from a member with requisite
deposits signifying his intention to propose the candidature of Ms.
Ojha for the office of Director. A brief profile of Ms. Ojha is given
in the Notice convening the twenty-first Annual General Meeting.
Mr. Rajesh Kumar Bajaj, Managing Director, Mr. Sudheer Kumar Jain,
Whole-time Director are the Key Managerial Personnel (KMP) within the
meaning of Section 203(1) of the Act. Mr. Narendra Kumar Rai and Mr.
Sujit Kumar Sharma are other KMPs designated as the Company Secretary
and the Chief Financial Officer (CFO) of the Company respectively. All
of the above KMP have been appointed by the Board of Directors as
required under the provision of section 203(1) of the Companies Act.
DECLARATIONS GIVEN BY INDEPENDENT DIRECTORS
All the independent directors have confirmed to the Board that they
qualify to be considered as Independent as per the definition of
"Independent Director" stipulated in Section 149(6) of the Act and
Clause 49(II)(B)(1) of the Listing Agreement. These declarations has
been placed before, and noted by the Board.
BOARD MEETINGS
The Board meets at regular intervals to discuss and decide on the
Company's policies and strategy apart from other Board matters. During
the financial year 2014-15, ten board meetings were held on April 01,
2014, May 29, 2014, June 23, 2014, August 14, 2014, September 27, 2014,
November 14, 2014, December 17, 2014, January 19, 2015, February 14,
2015 and March 30, 2015. The gap between the two board meetings did not
exceed 120 days.
POLICIES ON DIRECTORS' APPOINTMENT AND REMUNERATION
The policy of the Company on Directors' appointment and remuneration
including criteria for determining qualifications, positive attributes,
independence of director and other matters provided under sub-section
(3) of Section 178 of the Act is appended as Annexure Ito this Report.
EVALUATION OF THE BOARD OF DIRECTORS
Pursuant to the provision of the Act and Clause 49 of the Listing
Agreement, the Nomination and Remuneration Committee of the Board
carried out the annual evaluation of the performance of the Board as a
whole, the Directors individually as well as of various committees of
the Board. A structured evaluation feedback form was prepared after
taking into consideration the inputs received from the directors,
covering various aspects such as board structure and composition,
effectiveness of the board process, information and functioning,
establishment and determination of responsibilities of Committees, and
quality of relationship between the board and the management.
Also, a separate questionnaire was prepared to evaluate the performance
of individual directors which had parameters such as professional
conduct, roles and functions, discharge of duties, and their
contribution to the Board/ Committee and Senior Management. The
performance evaluation of the independent directors were carried out by
the Nomination and Remuneration Committee and noted in turn by the
Board.
COMMITTEES OF DIRECTORS
Your Company has five Committees of the Board, viz.
1. Audit Committee
2. Stakeholders' Relationship Committee
3. Nomination and Remuneration Committee
4. Risk Management Committee
5. Independent Directors Committee
Details of all the Committes alongwith their composition, terms of
reference and meetings held during the year are provided in "Report on
Corporate Governance" forming part of the Annual Report.
STATUTORY AUDITORS:
M/s. Patni & Co., Chartered Accountants, who are the Statutory Auditors
of the Company, hold office, in accordance with the provisions of the
Act, for a period of three years viz., financial years 2014-15, 2015-16
and 2016-17 from the conclusion of 20th Annual General Meeting until
the conclusion of the 23rd Annual General Meeting i.e. upto financial
year 2016-17. As per Section 139(2) of the Act and the applicable Rules
of the Act, the appointment of the Statutory Auditors needs to be
ratified by the members at every Annual General Meeting. Accordingly,
the members are requested to ratify the appointment of the statutory
Auditor at Twenty-first Annual General Meeting.
SECRETARIAL AUDIT:
Pursuant to the requirements of Section 204(1) of the Act, and Rule 9
of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, the Company has appointed Ms. Poonam Mundhra, Company
Secretary in Practice to conduct the secretarial audit for the
financial year 2014-15. The Secretarial Audit Report as received from
Ms. Poonam Mundra is appended to this Report as Annexure-III. As
regard to non-payment of dividend to Investor Education Fund, the
Company is reconciling the unpaid dividend with the respective bank and
will pay the amount to the Fund after reconciliation.
COMMENTS ON AUDITORS' REPORT:
The statutory auditors of the Company submitted their report on the
accounts of the Company for the accounting year ended 31st March, 2015,
which was self explanatory and needed no comment. As regard to point
no. (7) of the Annexure to the Auditor's Report, the Company is
reconciling the unpaid dividend account for the financial year 2006-07
with the concerned bank and will pay the unpaid amount, if any, to
Investor Education Fund on completion of reconciliation.
CORPORATE SOCIAL RESPONSIBILITY
The provision of Section 135 of the Companies Act, 2013 read with
Companies (Corporate Social Responsibility Policy) Rules, 2014 are not
applicable to the Company since it is not fulfilling any of the
stipulated requirements of net-worth, turnover and net profits.
RISK MANAGEMENT AND INTERNAL CONTROLS
The Company has a well defined risk management framework in place.
Further, it has established procedures to periodically place before the
Board, the risk assessment and management measures. The details of the
risks faced by the Company and the mitigation thereof are discussed in
detail in the Management Discussion and Analysis report that form part
of the Annual Report.
REPORT ON CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND ANALYSIS
The reports on Corporate Governance and Management Discussion and
Analysis for the year under review, as stipulated under clause 49 of
the Listing Agreement form part of the Annual Report. The certificate
from the Auditors of the Company confirming compliance with the
conditions of Corporate Governance is annexed to the Corporate
Governance Report.
PARTICULARS OF EMPLOYEES AND RELATED INFORMATION:
The particulars of the employees pursuant to the provisions of Section
197(12) of the Companies Act, 2013, read with Rule 5(2) and Rule 5(3)
of the Appointment and Remuneration of Managerial Personnel) Rules,
2014, are not given since none of the employees are in receipt of a
remuneration in excess of the prescribed limit. Disclosure pertaining
to remuneration and other details as required under section 197(12) of
the Companies Act, 2013 read with Rules 5(1) of the Appointment and
Remuneration of Managerial Personnel) Rules, 2014 are provided in
Annexure-IV.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Details of Loans, Guarantees and Investments covered under the
provisions of Section 186 of the Companies Act, 2013 are given in the
notes to the financial statements.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WIH RELATED PARTIES
The particulars of contracts or arrangements with related parties
referred to in Section 188(1) as prescribed in Form AOC-2 are appended
as Annexure-V.
A policy on Materiality of Related Party Transactions and dealing with
related part has been adopted by the Board of Directors and the said
policy is posted at the Company's website at www.lohiasecurities.com.
EXTRACT OF ANNUAL RETURN
Pursuant to the requirement under section 92(3) and Section 134(3) of
the Act read with Rule 12 of the Companies (Management and
Administration) Rules, 2014, an extract of Annual Return in prescribed
Form MGT-9 is given in the Report as Annexure-VI
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION:
The Company is engaged in providing securities trading and financial
services and such operations do not account for substantial energy
consumption. In view of the nature of activities which are being
carried on by the Company, the particulars as prescribed under section
134(3)(m) of the Act read with the Companies' (Accounts) Rules, 2014
regarding Conservation of Energy and Technology Absorption, and
research and development are not applicable to the Company.
FOREIGN EXCHANGE EARNINGS AND OUTGO:
During the year, the Company has not earned or expended any foreign
exchange.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY:
The Company has established a vigil mechanism to provide appropriate
avenues to the Directors and employees to bring to the attention of the
Management, the concerns about behavior of employees that raise
concerns including fraud by using the mechanism provided in the Whistle
Blower Policy. The details of such policy are included in the Report on
Corporate Governance which farm part of the Annual Report. During the
financial year 2014-15, no cases under this mechanism were reported in
the Company and any of its subsidiaries/ associates.
POLICY FOR PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT
OF WOMEN AT WORKPLACE
Our policy against sexual harassment is embodies both in the Code of
Conduct of Lohia Securities Group as also in a specially written policy
in accordance with the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013. During the financial
year 2014-15, no cases in the nature of sexual harassment were reported
at any workplace of Lohia Securities group.
ACKNOWLEDGEMENTS
The Directors express their sincere gratitude to the cooperation and
support received from shareholders, customers, business associates,
bankers, SEBI and other regulatory and government authorities.
Your directors thanks all the valued clients, sub-brokers,
shareholders, banks, financial institutions, stock exchanges,
depositories and other stake holders for their patronage and support
and take this opportunity to express their appreciation of the
dedicated and committed team of employees of the Company.
For and on behalf of the Board of Directors
Rajesh Kumar Bajaj Sudheer Kumar Jain
Kolkata, the 14th day
of August, 2015 Managing Director Whole-time Director
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