Anand Rathi Share & Stock Brokers Ltd Directors Report

To,

The Members of

Anand Rathi Share and Stock Brokers Limited

Your Directors are pleased to present their Thirty-Second (32^nd) report together with the Audited Standalone Financial Statements of your Company for the financial year ended 31^st March, 2023 (FY 2022-23).

1. FINANCIAL SUMMARY

A summary of the Companys financial results for the Financial Year 2022-23 is as under:

Particulars	Standalone
	2022-23	2021-22
Total Income	46,863.12	42,368.73
Less: Total Expenses	41,643.24	35,971.23
Profit before Tax	5,219.88	6,397.50
Less: Total Tax Expense	1,324.58	1,279.07
Net Profit after tax but before Other Comprehensive Income	3,895.30	5,118.43
Other Comprehensive Income	(20.59)	(43.31)
Total Comprehensive Income	3,874.72	5,075.12
Earnings Per share (basic & diluted)	24.57	50.39

2. PERFORMANCE HIGHLIGHTS AND STATE OF COMPANYS AFFAIRS

The total income increased by 10.60% to Rs. 46,863.12 Lakhs in current financial year as compared to Rs. 42,368.73 Lakhs in the previous financial year; however the total expenses incurred by the Company increased to Rs. 41,643.24 Lakhs as against previous years Rs. 35,971.23 Lakhs.

The Company earned a net profit of Rs. 3,895.30 Lakhs in the current financial year compared to Rs. 5,118.43 Lacs in the previous financial year.

3. HIGHLIGHTS OF PERFORMANCE OF SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES AND THEIR CONTRIBUTION TO THE OVERALL PERFORMANCE OF THE COMPANY

As of 31^st March, 2023, the Company has one Wholly-owned subsidiary and details of the same is provided as under:

Anand Rathi International Ventures (IFSC) Private Limited [ARIFSC]: ARIFSC is a Wholly- owned subsidiary of Anand Rathi Share and Stock Brokers Limited. The Company is registered in Gift Special Economic Zone (Gift City), in the Gujarat State and received certificate of commencement of business with effect from 25^th June, 2020 from the office of the Development Commissioner, Gift SEZ, Ministry of Commerce & Industry, Government of India.

During the year under review, the operating revenue of ARIFSC for FY 2022-2023 was Rs. 2.10 Lakhs as compared to revenue earned of Rs. 8.79 Lakhs in the previous year.

The Company does not have any Associate or Joint Venture companies during the year under review or any time after the closure of the financial year till the date of report.

Pursuant to Section 129(3) of the Companies Act, 2013 (hereinafter referred to as "the Act") read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement in Form AOC-1 containing salient features of the financial statements of Wholly-owned Subsidiary is annexed as "Annexure-I" which forms an integral part of this Report.

4. CONSOLIDATED FINANCIAL STATEMENTS

Pursuant to the Companies (Accounts) Rules, 2014, Anand Rathi Financial Services Limited, the ultimate Holding Company files consolidated financial statements with the Registrar of Companies, accordingly the Company is exempted from preparing and filing consolidated financial statements.

5. DIVIDEND

In order to conserve the resources and further boost the growth momentum, your Directors have decided to plough back the profits. Therefore, your Directors have not recommended any dividend for the FY 2022-23.

6. TRANSFER TO RESERVES

The Board of Directors of your Company has decided to not transfer any amount to the Reserves for the year under review.

7. SHARE CAPITAL Authorized Share Capital

The Authorized Share Capital of your Company was increased from Rs. 25,00,00,000/- (Rupees Twenty Five Crores only) to Rs. 30,00,00,000/- (Rupees Thirty Crores Only) vide resolution passed by the shareholders of the Company at their 31^st Annual General Meeting held on 27^th September, 2022.

Consequent to the above, the Authorized Share Capital of your Company as on 31^st March, 2023 stood at Rs. 30,00,00,000/- (Rupees Thirty Crores only) divided into 2,97,50,000 (Two Crores Ninety Seven Lakhs Fifty Thousand) Equity Shares of the face value of Rs. 10/- (Rupees Ten only) each and 2.50.000 fT\yo Lakhs Fifty Thousand) Preference Shares of Rs. 10/-

(Rupees Ten only) each.

Further issue of Share Capital

During the year under review, the shareholders at their 31^st Annual General Meeting held on 27^th September, 2022 had accorded approval for issuing bonus shares to the existing shareholders of the Company.

Further, allotment of 67 20,517 Equity Shares of the face value of Rs. 10/- each was made at the Board Meeting held on 21^st November, 2022.

Consequent to the above allotment, the issued, subscribed and paid-up share capital of your Company as on 31^st March, 2023 stood at Rs. 20,16,15,500/- (Rupees Twenty Crores Sixteen Lakh Fifteen Thousand Five Hundred only) divided into 2,01,61,550 (Two Crores One Lakhs Sixty One Thousand Five Hundred Fifty) Equity Shares of the face value of Rs. 10/- (Rupees Ten only) each.

Sub-division of the nominal value of shares

The Board of Directors of the Company at their meeting held on 4^th May, 2023, considered sub-dividing the nominal value of the shares from existing Rs. 10/- each to Rs. 5/- thereby keeping the paid-up share capital of the Company intact, subject to other applicable laws and shareholders of the Company.

Furthermore, the shareholders of the Company at their 01/2023-24 Extra-ordinary General Meeting held on 20^th June, 2023, approved sub-division of the nominal value of the shares, thereby keeping the paid-up share capital of the Company intact.

The Authorized Share Capital of the Company pursuant to the sub-division of nominal value of shares, as on the date of report stood at Rs. 30,00,00,000/- (Rupees Thirty Crore only) divided into 5,95,00,000 (Five Crore Ninety Five Lakhs) Equity Shares of Rs. 5/- (Rupees Five only) and 5,00,000 (Five Lakhs) Redeemable Preference Shares of Rs. 5/- (Rupees Five only).

8. ISSUE OF NON - CONVERTIBLE DEBENTURES (NCD) ON PRIVATE PLACEMENT BASIS

During the year under review, your Company issued Unrated, Unlisted, Secured, Redeemable, Non-Convertible Debentures ("NCDs") of Face Value aggregating to Rs. 123,50,00,000/- (Rupees One Hundred Twenty Three Crore and Fifty Lakhs only) on a private placement basis, in various tranches. As specified in the respective offer documents, the funds raised from NCDs were utilized for general corporate purpose and/or for meeting working capital requirements of the Company.

9. ALTERATION OF MEMORANDUM OF ASSOCIATION

The Share Capital Clause of the Memorandum of Association ("MOA”) of your Company was altered in order to reflect the increased Authorized Share Capital from Rs. 25,00,00,000/- (Rupees Twenty Five Crore only) to Rs. 30,00,00,000/- (Rupees Thirty Crore only) as approved by the shareholders of the Company on 27^th September, 2022.

Further, the Members of the Company at their Extra-ordinary General Meeting held on 15^th December, 2022, inserted an additional clause under the existing Main object clause of the

Company vide Special resolution.

Further, after closure of the financial year and as on the date of report, the Share Capital Clause of the Memorandum of Association ("MOA") of your Company was altered in order to reflect the sub-division of nominal value of shares as approved by the Members of the Company vide Special Resolution passed at their 01/2C23-24 Extra-ordinary General Meeting held on 20^th June, 2023.

10. CHANGE IN THE NATURE OF BUSINESS

There has been no change in the nature of the Businesses being carried out by the Company during the year under review.

11. ANNUAL RETURN

Pursuant to the requirement under Section 92(3) of the Companies Act, 2013, copy of annual return of the Company for the FY 2022-23 is available on https://anandrathi.com/.

12. BOARD, COMMITTEES, KEY MANAGERIAL PERSONNEL AND MEETINGS:

Board of Directors

The Board of the Company comprises or 4 (Four) Directors as under:

SI. No. Name	Designation
1. Mr. Pradeep Kumar Gupta	Managing Director
2. Mrs. Priti Pradeep Gupta	Managing Director
3. Mr. Vishal Jugal Laddha	Whole-time Director
4. Mr. Roop Kishor Bhootra	Whole-time Director

Board Committees

In accordance with applicable provisions of Companies Act, 2013, the Board has constituted following Committees:

SL No. Name of Committee	Member
1. Audit Committee ("AC”)	1. Mr. Roop Kishor Bhootra - Chairman
	2. Mr. Vishal Jugal Laddha - Member
	3. Mr. Pradeep Gupta - Member
2. Nomination and Remuneration	1. Mr. Vishal Jugal Laddha - Chairman
Committee ("NRC”)	2. Mr. Roop Kishor Bhootra - Member
	3. Mrs. Priti Pradeep Gupta - Member
3. Corporate Social Responsibility	1. Mr. Pradeep Gupta - Chairman
Committee ("CSR”)	2. Mr. Roop Kishor Bhootra - Member
	3. Mrs. Priti Pradeep Gupta - Member
4. Management Committee	l.Mr. Pradeep Gupta - Chairman
	2.Mrs. Priti Pradeep Gupta - Member
	3.Mr. Roop Kishor Bhootra - Member

Key Managerial Personnel (KMP)

Pursuant to Companies Act, 2013, your Company has appointed/designated following employees/officers as Whole-time Key Managerial Personnel:

SI. No. Name	Designation
1. Mr. Pradeep Kumar Gupta	Managing Director
2. Mrs. Priti Pradeep Gupta	Managing Director
3. Mr. Roop Kishor Bhootra	Whole-time Director
4. Mr. Vishal Jugal Laddha	Whole-time Director
5. Mr. Tarak Kumarpal Shah	Chief Financial Officer (Appointed with effect from 22nd August, 2022)
6. Mr. Nitesh Tanwar	Company Secretary (Appointed upto 12th October, 2022)
7. Ms. Manasi Shah	Company Secretary (Appointed with effect from 20th February, 2023)

Appointment and cessation of Directors and Key Managerial Personnel

During the year under review there were no changes in the composition of the Board of Directors of the Company.

Pursuant to the provisions of Section 203 of the Companies Act, 2013, Mr. Tarak Shah was appointed as the Chief Financial Officer of the Company with effect from 22^nd August, 2022 and Ms. Manasi Shah was appointed as the Company Secretary with effect from 20^th February, 2023.

Further, Mr. Nitesh Tanwar resigned as Company Secretary of the Company with effect from 12^th October, 2022.

Directors retiring by rotation:

In terms of Section 152 of the Companies Act, 2013, Mr. Vishal Jugal Laddha (DIN: 00033628) shall retire by rotation at the forthcoming AGM and being eligible, he offers himself for reappointment. Necessary resolution for his re-appointment has been inserted in the Notice of the ensuing Annual General Meeting for the Members approval.

Details regarding Board/ Committee Meetings

During the year under review, the Board and Committees of Board met on the following dates. The Meetings of the Board of Directors were held such that not more than 120 days elapsed between two Board Meetings.

Details of the meetings held during the year is as under:

Board Meeting	Audit Committee	CSR Committee	NRC Committee	Management Committee
18.04.2022	18.04.2022	18.04.2022	22.08.2022	01.06.2022
11.05.2022	22.08.2022	20.02.2023	20.02.2023	13.06.2022
30.06.2022	21.11.2022	-	-	10.10.2022
11.07.2022	20.02.2023	-	-	31.10.2022
22.08.2022	-	-	-	14.11.2022
29.09.2022	-	-	-	15.11.2022
07.11.2022	-	-	-	30.11.2022
21.11.2022	-	-	-	08.12.2022
20.02.2023	-	.	_	27.12.2022
-	-	-	-	09.01.2023
-	-	-	-	13.02.2023
-	-	-	-	13.03.2023
-	-	-	-	31.03.2023

The number of the meetings attended bv each Director is as under:

Numbers of Board Meeting Attended by the Directors
Meeting date	Mr. Pradeep Kumar Gupta	Mrs. Priti Pradeep Gupta	Mr. Roop Kishor Bhootra	Mr. Vishal Jugal Laddha
18.04.2022	y	y	y	y
11.05.2022	y	y	y	y
30.06.2022		y	y	y
11.07.2022	?	y	y	y
22.08.2022	V	y	y	y
29.09.2022	y	y	y	y
07.11.2022	¦/	y	y	y
21.11.2022	y	y	y	y
20.02.2023	V	X	y	y

 

Numbers of Audit Committee Meeting Attended by the Committee Members
Meeting date	Mr. Roop Kishor Bhootra	Mr. Pradeep Kumar Gupta	Mr. Vishal Jugal Laddha
18.04.2022	y	y	y
22.08.2022	y	y	y
21.11.2022	y	y	y
20.02.2023	y	y	y

 

Numbers of CSR Committee Meeting Attended by the Committee Members
Meeting date	Mr. Roop Kishor Bhootra	Mr. Pradeep Kumar Gupta	Mrs. Priti Pradeep Gupta
18.04.2022	V		y
20.02.2023	y	y	X

 

Numbers of NRC Committee Meeting Attended by the Committee Members
Meeting date	Mr. Roop Kishor Bhootra	Mr. Vishal jugal Laddha	Mrs. Priti Pradeep Gupta
22.08.2022	y	y
20.02.2023	y	,4	X

 

Numbers of Management Committee Meeting Attended by the Committee Members
Meeting date	Mr. Pradeep Kumar Gupta	Mrs. Priti Pradeep Gupta	Mr. Roop Kishor Bhootra
01.06.2022	y	V
13.06.2022	y	y	y
10.10.2022	y	y
31.10.2022	y	y	y
14.11.2022	y	V	V
15.11.2022	y	y	y
30.11.2023	y	y	y
08.12.2022	y	y	V
27.12.2022	¦/	y	X
09.01.2023	y	y	y
13.02.2023	y	y	y
13.03.2023	y	V	y
31.03.2023	y	V	y

13. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, your Directors to the best of their

knowledge, belief, ability and explanations obtained by them, confirm that:

i) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii) such accounting policies have been selected 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 the period;

iii) proper and sufficient care have been taken 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 regularities;

iv) the annual accounts are prepared on a going concern basis; and

v) proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

14. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

The detailed particulars of investment made, loans/guarantees given and securities provided

to any other body corporate, if any, has been disclosed at respective places in Standalone

Financial Statements under appropriate heading.

15. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

During the financial year 2022-23, the Company has entered into transactions with related parties as defined under Section 2(76) of the Companies Act, 2013, all of which were in the ordinary course of business and on arms length basis.

Members may note that there were no materially significant related party transactions made by the Company with its Promoters, Directors, Key Managerial Personnel or any other designated persons which may have a potential conflict with the interest of the Company at large.

Particulars of material contract or arrangements or transactions at arms length basis is disclosed as per the prescribed form AOC-2 and annexed as "Annexure-H" which forms an integral part of this Report.

Your Directors have entered into Related Party Transactions as approved by the Board of Directors, based upon the recommendations of the Audit Committee. On quarterly basis, the Audit Committee reviewed such transactions, for which prior omnibus approval was given.

16. CORPORATE SOCIAL RESPONSIBILITY ("CSR")

Pursuant to the provisions of Section 135 of the Act read with Companies (Corporate Social Responsibility) Rules, 2014, the CSR Committee has formulated and recommended to the Board a Corporate Social Responsibility Policy (CSR Policy) indicating the CSR activities which can be undertaken by the Company. Details of the CSR Policy is available on our website at www.anandrathi.com.

The salient features of the aforesaid policy including the details of CSR contributions made during the FY 2022-23 are given in "Annual Report on CSR Activities" prepared as per the provisions of Rule 8 of Companies (Corporate Social Responsibility) Rules, 2014.

The aforesaid report is annexed as "Annexure -III” which forms an integral part of this Report.

17. POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES, INDEPENDENCE OF A DIRECTOR.

The Board, on the recommendation of the Nomination and Remuneration Committee, has formulated a Policy on Directors appointment and remuneration including criteria for determining qualifications, positive attributes and independence of directors.

The Policy is directed towards a compensation philosophy and structure that will reward and retain talent and provides for a balance between fixed and incentive pay reflecting short- and long-term performance objectives appropriate to the working of the Company and its goals.

The policy is enclosed as "Annexure- IV" to this report.

18. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE

EARNINGS AND OUTGO

a) The Company being engaged in the financial services activities, its operations are neither energy intensive nor does it require adoption of specific technology. Hence information in terms of Section 134(3)(m) of the Act read with the Companies (Accounts) Rules, 2014 is not applicable to the Company.

b) The details of foreign exchange earnings in terms of actual inflows and the foreign exchange outgo in terms of actual outflow of the Company during the Financial Year ended 31^st March, 2023 are as under:

Particulars	Amount (In Lakhs)
Foreign exchange earnings	0.11
Foreign exchange expenditure / outgo	159.93

19. RISK MANAGEMENT

Risk management is embedded in your Companys operating framework. Your Company believes that managing risks helps in maximizing the returns. The Companys approach to addressing business risks is comprehensive and includes periodic review of such risks and a framework for mitigating controls and reporting mechanism of such risks. Also, key business risks and their mitigation are considered on a regular basis in the annual/strategic business plans and in periodic management reviews.

20. INTERNAL CONTROL SYSTEMS

The Company has in place proper and adequate internal control systems commensurate with the nature of its business, size and complexity of operations. Internal control systems comprise policies and procedures that are designed to ensure reliability of financial reporting, compliance with applicable laws and regulations. Necessary policies and procedures are in place inter alia to ensure that all assets and resources are acquired economically, used efficiently and protected adequately.

21. MATERIAL ORDERS OF JUDICIAL BODIES /REGULATORS

During the year under review, no significant and material orders have been passed by any Regulator or Court or Tribunal which could have impact on the going concern status and the operations of the Company in future.

22. STATUTORY AUDITOR

Pursuant to the provision of Section 139 of the Companies Act, 2013, R Kabra & Co. LLP, Chartered Accountants (Firm Registration No. 104502W/W100721) were appointed as the Statutory Auditors of the Company for a period of five consecutive years at the Annual General Meeting of the members held on 22^nd September, 2021 till the conclusion of Annual General Meeting to be held in the year 2026. /rD u f\

There were no qualification, reservation or adverse remark in the Audit report as issued by the Statutory Auditors for the financial year ended 31^st March, 2023 and that the report is self-explanatory and does not call for any comment.

The Company has received a certificate from the said Auditors that they are eligible to hold office as Auditors of the Company and are not disqualified for being so appointed for the financial year 2023-24.

23. SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of Companies Act, 2013 and rules made thereunder, M/s. Dharmesh Bohra & Associates, Practicing Company Secretaries were appointed as Secretarial Auditor of the Company to undertake the Secretarial Audit of the Company. The Secretarial Audit Report in Form MR-3 is annexed as "Annexure-V" which forms an integral part of this Report.

Further, there are no qualifications / adverse remarks provided in the Secretarial Audit Report for the financial year ended 31^st March, 2023.

24. INTERNAL AUDITORS

Pursuant to the provisions of Section 138 of Companies Act, 2013 and rules made thereunder, M/s. Mahesh Chandra & Associates, Chartered Accountants were appointed as Internal Auditors of the Company.

There were no qualifications / adverse remarks provided in the Internal Audit Report for the financial year ended 31^st March, 2023.

25. COMPLIANCE WITH SECRETARIAL STANDARDS

Your Company is in compliance with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India and as approved by the Central Government under Section 118(10) of the Act.

26. VIGIL MECHANISM

In Pursuant to Section 177 of the Act read with the rule 7 of the companies (Meetings of the Board and its Powers) Rules, 2014, your Company has established a "Vigil Mechanism and Whistle Blower Policy” for Employees including the Directors in employment of the Company. During the year under review, the Company has not received any complaints under vigil mechanism.

27. DISCLOSURES PERTAINING TO THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Board is committed to providing a safe and conducive working environment for the women employees of the Company, and accordingly, has formulated a policy on prevention, \ prohibition ojf sexual harassment of women employees at the work place.

The policy inter alia provides for prevention, prohibition of any acts of sexual harassment of women employees at workplace and the procedure for the redressal of complaints, if any, pertaining to sexual harassment. The Company has constituted an Internal Complaint Committee in accordance with Section 4 of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 to hear and dispose of the cases relating to sexual harassments.

There were no complaints received under POSH during the year under review.

28. 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

Except as stated above, there were no material changes and commitments affecting the financial position of your Company from the end of the financial year till the date of this report, which could impact your Companys operations or its status as going concern.

29. GENERAL

Your Directors confirm that no reporting is required to be made on the following provisions as the same is not applicable during the year under review:

a) There were no instances of non-exercising of voting rights in respect of shares purchased directly by employees under a scheme pursuant to Section 67(3) of the Companies Act, 2013 read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014;

b) None of the Director or Key Managerial Personnel are in receipt of remuneration from Holding / Subsidiary Company;

c) There were no instances of reporting of frauds as per Section 143 of the Companies Act, 2013 during the year under review;

d) There were no instances of shares being purchased directly by employees under a scheme pursuant to Section 67(3) of the Companies Act, 2013 read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014;

e) Appointment of Cost Auditor as per Section 148 of the Companies Act, 2013;

f) The Company has neither issued any shares with differential rights as to dividend, voting or otherwise nor issued any sweat equity shares during the year under review;

g) There was no application made or any proceeding is being pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year / at the end of the financial year;

h) Chapter V of the Companies Act, 2013 relating to acceptance of deposits;

i) Revision in financial statements of the previous year; and

j) There were no details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.

30. ACKNOWLEDGEMENT

Your Directors wish to place on record their deep appreciation for the contribution made by the employees at all levels without whose hard work and support, your Companys achievements would not have been possible. Your Directors also wish to place on record their sincere appreciation for the continued support, cooperation, guidance and encouragement extended by the government, regulatory, statutory bodies including Companys bankers.

We are hopeful of receiving your continued support and cooperation in future as well.