Abhinav Capital Services Ltd Directors Report.

Dear Members,

The Board of Directors hereby submit the report of the business and operations of your Company (the Company or Abhinav Capital Services Limited) along with the Audited financial Statements, for the financial year ended March 31, 2021.

Financial Performance

(Amount in Rs.)

Particulars Current Year 2020-21 Previous Year 2019-20
(Rs.) (Rs.)
Revenue from Operations 3,25,12,056 4,34,43,789
Other Income
Income from operations 3,25,12,056 4,34,43,789
Less: Financial Expenses 10,33,947 1,11,53,720
Less: Depreciation & Amortisation Expenses 51,198 74,448
Less: Other Expenses 1,14,68,978 1,86,53,429
Less: Employee Benefits Expenses 22,69,916 19,22,450
Profit/(Loss) Before Tax & Exceptional Items 1,76,88,017 1,16,39,741
Less: Current year Taxation 68,00,000 70,00,000
Less: Short Provisions for Prior Years (5,84,297)
Less: Deferred Tax 28,77,531 (51,99,890)
Less: Exceptional item 87,346
Profit After Tax 80,10,486 1,03,36,582
Less: Appropriation
Transfer to General Reserve - -
Proposed Dividend - -
Tax on Dividend - -
Surplus carried to Balance Sheet 80,10,486 1,03,36,582
TOTAL 80,10,486 1,03,36,582

The year under review has been one of the most challenging years for your Company. Your company posted total income and net profit of Rs. 3,25,12,056/- and Rs. 80,10,486/- respectively, for the financial year ended March 31, 2021, as against Rs. 4,34,43,789, /- and Rs. 1,03,36,582/- respectively from the previous year. The year under review has been one of the most challenging years both for your Company and its customers. The COVID-19 pandemic outbreak which began in the middle of March 2020 continued to impact the economy throughout the financial year 2020-21. The year was full of uncertainties. There was slowdown in the activities.

Outlook

Your Company has earned Rs. 3,25,12,056 by way of interest on loan, Dividend Income & Profit by sale of Investments. Company is managed by professionals. Company is always following strict norms as prescribed by the management for disbursement of Loan. Management is of the opinion that Companys NPA will be within the limit as prescribed by the Management. Company has invested Rs.18.35 crores in Mutual Funds and Equity Market. Board is confident that this Investment will fetch good returns.

SWOT analysis

Strengths

Distinguished financial services provider, with local talent catering to local customers. Simplified and prompt loan request appraisals and disbursements. Product innovation and superior delivery. Innovative resource mobilization techniques and prudent fund management practices.

Weakness

Regulatory restrictions - continuously evolving government regulations may Impact operations. Uncertain economic and political environment.

Opportunities

Demographic changes and under penetration.

Large untapped markets.

Use of digital solutions for business/collections.

Threats

High cost of funds.

Rising Non-Performing Assets (NPAs).

Competition from other NBFCs and banks

Reserves

Your Company has transferred an amount of 54.18 Lakhs to Reserve Fund under Section 45-IC of the RBI Act, 1934.

Dividend

To conserve capital for growth of the Company and to deal with the uncertain economic environment due to the pandemic, your directors do not recommend any dividend payment at the ensuing AGM to be held on 30th September 2021.

Material changes and commitments, if any, affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report

There are no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of this Report.

Share Capital

• The Authorized Share Capital of the Company is Rs.8,00,00,000/- divided in to 80,00,000 Equity Shares of face value of Rs.10/- each. There is no change in the Authorized Share Capital of the Company during the year under review.

• The Paid-up Share Capital of the Company is Rs.6,92,46,000/- divided in to 69,24,600 Equity Shares of face value of Rs.10/- each. There is no change in the Paid-up Share Capital of the Company during the year under review.

• The Company has not issued any equity shares with differential rights as to dividend, voting or otherwise during the year under review.

a) Buy Back of Securities

The Company has not bought back any of its securities during the year under review.

b) Sweat Equity

The Company has not issued any sweat equity during the year under review.

C) Bonus Shares

The Company has not issued any bonus shares during the year under review.

Listing Of Shares

The Companys equity shares are listed on the BSE Ltd., The Company confirmed that the annual listing fees has been paid to the Stock exchange for F.Y. 2020-21.

Subsidiaries, Joint Ventures and Associate Companies

The Company does not have any Subsidiary, Joint venture or Associate Company.

Directors & Key Managerial Personnel

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company Ms Ritu Mohatta (DIN 08860676), Director is retiring by rotation at the ensuing Annual General Meeting of the Company and is eligible for re-appointment & she has offered herself for re-appointment.

Appropriate resolutions for the appointment/re-appointment of Directors are being placed for your approval at the ensuing Annual General Meeting.

The Company has reappointed Mrs. Gayatri Sonavane (DIN 07251680) as Independent Director of the Company with effect from 30th September 2020 and the same has been placed in the ensuing Annual General Meeting for the members approval.

The Company has appointed Mr. Nasir Shaikh (DIN 08985677) as an Additional Director (Independent). The Board requested members to approve his appointment in the Annual General Meeting.

Mr. Pramod Gupta resigned from the Company Secretary and Compliance Officer of the Company on 22nd March 2021 & accordingly, Mrs. Vrunda Mehta was appointed as Company Secretary and Compliance officer.

Mrs. Vrunda Mehta resigned from post of Company Secretary and Compliance Officer on 25th June 2021.

Mrs. Reshma Matele Bhosle was then appointed as Company Secretary and Compliance Officer of the Company on 25th June 2021.

Declaration by Independent Directors

The Company has received declaration from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013

Familiarization Program for the Independent Directors

In compliance with the requirements of the Listing Regulations, the Company has put in place a Familiarization Program for the Independent directors to familiarize them with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model etc.

Meeting of Independent Directors

The Independent Directors met once during the year under review. The Meeting was conducted in an informal manner without the presence of the Chairman, the Non-Executive Non-Independent Directors and the Chief Financial Officer.

Policies on appointment and remuneration of Directors

Policy for determining qualifications of directors and Policy for remuneration of Directors approved by the Nomination and Remuneration Committee of the Board of Directors, are available at Companys website.

Board and Directors evaluation

Performance evaluation of the Board as whole, individual directors and of the Board Committees, was carried out by Board of Directors, as suggested by the Nomination and Remuneration Committee.

The evaluation was done in accordance with the framework and criteria laid down by the Committee. Further, at a separate meeting, the Independent Directors evaluated performance of Non-Independent Directors, Board as a whole and of the Chairman of the Board.

Manner of evaluation of Board of Directors performance and matters incidental thereto, are detailed in the Corporate Governance Report, which forms part of this report. Board of Directors were satisfied with the evaluation process and expressed satisfaction over performance of individual directors, Board as a whole and of the Board Committees, as Revealed by the evaluation reports.

Details of Board Meetings

During the year under review, Eight Board meetings were held, details of which are provided in Corporate Governance Report.

Public Deposits

The Company has not taken any deposits from the public for which information is required to be given in the Report.

Conservation Of Energy

The company is utilizing electricity optimally.

Technology Absorption

The company has not purchased or imported any new technology. Hence, not applicable.

Foreign Exchange Earnings and Outgo: NIL Particulars Of Employees: -

During the year under report, your Company has not employed any person who was in receipt of remuneration in excess of the limits specified under Section 197 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Details of Unclaimed Suspense Account

The Company is not having unclaimed suspense account as required under schedule V of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.

Statutory Auditors and their Report

M/s S C Mehra & Associates LLP, Chartered Accountants (Firm Registration No. 106156W/ W100305) is appointed as the Statutory Auditor of the Company for period of 5 years at the Annual General Meeting held on 28th September 2017 and shall hold office up to Annual General Meeting to be held in the year 2022.

The Statutory Auditors have given a confirmation to the effect that they are eligible to continue with their appointment and that they have not been disqualified in any manner from continuing as Statutory Auditors.

The Notes on financial statement referred to in the Auditors Report are self-explanatory and do not call for any further comments.

The Auditors Report does not contain any qualification, reservation or adverse remark. No fraud has been reported by the Auditors to the Audit Committee or the Board.

Extract of Annual Return as per Section 92 (3) of Companies Act 2013

A copy of the annual return as provided under section 92(3) of the Act, in the prescribed form, which will be filed with the Registrar of Companies/MCA, is hosted on the Companys website and can be accessed at https://www.abhinavcapital.com.

Secretarial Audit Report

Pursuant to Section 204 of the Act, the Secretarial Audit Report for the Financial Year ended 31st March 2021 given by D G Prajapati & Associates, Practicing Company Secretary is annexed to this Report. The Secretarial Audit Report for the year under review is self-explanatory and annexed with this report as Annexure- A

Reports on Management Discussion Analysis

As required under the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015, management discussion and analysis report are annexed to this Report as Annexure- B.

Directors Comments on Auditors Report

The observations made by the Auditors in their Report read with relevant notes given in the Notes to Accounts are self-explanatory and therefore, do not require any comments from your Directors pursuant to Section 134 (3) (f) of the Companies Act, 2013.

RBI Guidelines

Your Company is Complying with all the requirements of Reserve Bank of India for Non-Banking Finance Company. In terms of paragraph 9BB of the NBFC Regulations, the particulars as applicable to the company are appended to the Balance sheet.

Directors Responsibility Statement

Pursuant to the requirement under section 134(5) of Companies Act, 2013, with respect of Directors responsibility statement, it is hereby confirmed that:

i) in the preparation of the account for the financial year ended 31st March 2021; the applicable accounting standards had been followed along with proper explanation relating to material departure.

ii) 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 & fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for the year under review.

iii) the Directors had taken 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) the Directors had prepared the accounts for the financial year ended 31st March 2021 on a going concern basis.

v) the Directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

vi) 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.

Disclosure of Composition of Audit Committee

The Audit Committee Member consists of Mr. Girish Desai, Mr. Chetan Karia & Ms. Gayatri Sonavane. The committee inter-alia reviews the internal control system & compliance of various regulations. The committee also reviews at length financial statements before they are placed before the Board.

Related Party Transactions

There have been no materially significant related party transactions, pecuniary transactions or relationships between the Company and its Directors that may have potential conflict with the interest of the Company.

Pursuant to the provisions of the Act, the Board has on recommendation of its Audit Committee, adopted a policy on related party transactions and the said policy is available on the website of the Company.

Statutory Disclosures

i. Pursuant to the provisions of Section 134(3)(a) and Section 92(3), the Annual Return of the Company in the prescribed Form MGT-7 is available on the website of the Company.

ii. Disclosures in terms of Section 197(12) read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure D.

Borrowings

The Company has not borrowed any fund during the FY 2020-21.

Fixed Deposits

The Company has not accepted any fixed deposit during the year under review.

Secretarial Standards

The Company has complied with the applicable provisions of secretarial standards issued by The Institute of Company Secretaries of India.

Risk Management Policy

The Company has a Risk Management Policy with an objective to formalize the process of identification of potential risk and adopt appropriate risk mitigation measures through a risk management structure. The Risk

Policy is a step taken by the Company towards strengthening the existing internal controls and updating the same as may be required from time to time.

Corporate Social Responsibility Initiatives

The Company has not implemented any Corporate Social Responsibility initiatives as the said provisions are not applicable.

Particulars Of Loans, Guarantees or Investments

Pursuant to section 186(11) of the Companies Act, 2013 (the Act), the provisions of section 186 (4) of the Act requiring disclosure in the financial statements of the full particulars of the loans made and guarantees given or securities provided by a Non-Banking Financial Company in the ordinary course of its business and the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient of the loan or guarantee or security are exempted from disclosure in the Annual Report.

Further, pursuant to the provisions of section 186 (4) of the Act, the details of investments made by the Company are given in the Notes to the Financial Statements.

Internal Control System

The Companys Internal Control procedure which includes Internal Financial Controls ensures that compliance with various policies, practices & Statutes & keeping in view the Companys pace of growth.

Evaluation of Performance of the Board, Its Committees and Individual Directors

The Board of Directors have carried out an annual evaluation of its own performance, its various committees and individual directors pursuant to the provisions of the Act and the Corporate Governance requirements as prescribed under the Listing Regulations. The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of various criteria such as Board Composition, process, dynamics, quality of deliberations, strategic discussions, effective reviews, committee participation, governance reviews etc.

Whistle Blower Policy/ Vigil Mechanism

To create enduring value for all stakeholders and ensure the highest level of honesty, integrity and ethical behavior in all its operations, the company has formulated a Vigil Mechanism named as Abhinav Whistle Blower Policy in addition to the existing code of conduct that governs the actions of its employees.

The Vigil Mechanism as envisaged in the Companies Act, 2013 and the Rules prescribed thereunder and the Listing Regulations is implemented through the Whistle Blower Policy, to provide for adequate safeguards against victimization of persons who use such mechanism and make provision for direct access to the Chairman of the Audit Committee.

The Whistle Blower Policy provides for protected disclosure and protection to the Whistle Blower. Under the Whistle Blower Policy, the confidentiality of those reporting violation(s) is protected, and they are not subject to any discriminatory practices.

Maintenance of Cost records

The maintenance of Cost records as specified by the Central Government under sub section (1) of section 148 of the Companies Act, 2013 is not applicable to the Company and accordingly such accounts and records are not made and maintained by the Company.

Internal Complaints Committee

The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of women at workplace (prevention, prohibition and Redressal Act, 2013.

Disclosure Under Sexual Harassment of Woman At Workplace (Prevention, Prohibition & Redressal) Act 2013

T7i

The Company has zero tolerance towards Sexual Harassment at the works place & has adopted a policy on Prevention, Prohibition & Redressal on works place in line with the act. The Company has not received any complaints of sexual harassment during FY 2020-21.

Corporate Governance & Management Discussion & Analysis Statement

The Company has taken adequate steps to ensure that the conditions of Corporate Governance as stipulated in Listing Regulations of the Stock Exchange are complied with. A detailed report on Corporate Governance has been included in this report as "Annexure C".

The Company has also obtained a certificate from the auditors of the company regarding compliance of conditions of Corporate Governance.

Further, Management Discussion and Analysis report is also annexed to this report.

Acknowledgement

Your directors thank the clients for the confidence in the Company, which has enabled the Company to reach to a new level of customer satisfaction. The Board places acknowledgment to the employees for their teamwork and professional approach for the Companys image. Your directors would like to express their gratitude for the continuous support and guidance received from Companys lenders, bankers, the Government departments, and SEBI and Stock Exchange officials.

For and on behalf of the Board of Directors,
Abhinav Capital Services Limited
Sd/-
Place: Mumbai Chetan Karia
(DIN:00015113)
Date: 10/08/2021 Chairman