Bhatia Communications & Retail (India) Ltd Directors Report.

To,

The Members

Bhatia Communications & Retail (India) Limited

Your Directors take pleasure in submitting the 12th Annual Report of the Business and operations of your Company and the Audited Financial Statements for the financial year ended 31st March, 2020.

1. FINANCIAL RESULTS& PERFORMANCE

(Rs. in Lakhs)

Particulars For the year ended 31-03-2020* For the year ended 31-03-2019*
Revenue from operations 16803.32 16509.49
Other Income 1896.69 1566.53
Total Revenue 18700.01 18076.02
Profit before tax and Exceptional Items 732.83 712.38
Exceptional Items 0 0
Profit before Taxation 732.83 712.38
-Current Tax 193.32 199.09
-Deferred Tax 0.46 5.17
-Income tax of earlier years 0.24 7.35
Net Profit/ (Loss) For The Year 538.81 500.77
Other Comprehensive Income for the Year, 3.19 3.34
Net of Tax
Total Comprehensive Income for the Year 542.00 504.11

* Figures regrouped wherever necessary

.The Company discloses financial results on half yearly basis of which results are subjected to limited review and publishes audited financial results on an annual basis. The Financial Statements as stated above are also available on the Companys website www.bhatiamobile.com.

2. STATE OF COMPANYS AFFAIR

During the year, Your Company recorded total revenue of 18700.01 Lacs againstRs. 18076.02 Lacs in the previous year, representing an increase of 3.45% during the year and Profit before Tax Rs.732.83 Lacs as compared to Rs.712.38 Lacs during the year. Total Income during the year Rs. 542.00 as compared to Rs. 504.11 in the previous year. A detailed analysis on the Companys performance is included in the "Managements Discussion and Analysis" Report, which forms part of this Report.

3. ROAD AHEAD

Our vision of becoming one of the top retail mobile chains and moving towards sustainable growth. Our priorities are as follows:

Focus on increasing same stores sales growth

Maintaining Price Competitiveness

Technology enabled inventory management system

Cross promotion through intelligent marketing

Moving up the value chain - Expanding the product line under own brand

We are very excited to enter into the new phase of growth and will continue to invest in our capabilities to increase our presence prudently and create value for the shareholders. We would like to be thankful to the entire stakeholder for being part of the journey.

4. DIVIDEND

The Board is pleased to recommend a dividend of 40% i.e. Re.4 per equity share for the financial year 2019-20. The dividend if approved by the members will be paid to the members within time limit defined in the Companies Act, 2013. The promoters of the company have waived there right to receive dividend declared by the company for financial year 2019-20, due to which the company will have to pay dividend only to 33,00,000 equity shareholders.

5. UNCLAIMED DIVIDEND

There is no balance lying in unpaid equity dividend account.

6. TRANSFER TO RESERVE

Company has not transferred any amount from profit to General Reserve.

7. MATERIAL CHANGES

COVID-19: In the last month of FY 2020, the COVID -19 pandemic developed rapidly into a global crisis, forcing governments across the globe to enforce lock-downs of all economic activity. For the company, the focus immediately shifted to ensuring the health and well-being of all employees, and on minimizing disruption to services for all our customers globally. In order to ensure smooth functioning, work from home facility was extended to many of the employees of the company. Although there were uncertainties due to the pandemic in the last quarter of FY 2020, inherent resilience of the business model will position the company well to navigate the challenges ahead. But then also the Covid-19 will impact the finances of the company and Its impact can be ascertained only after lifting of lockdown and life coming to stable position. The company has adopted Indian Accounting standard for the financial year ended on 31.03.2020. During the year the company has started the process for migration of company from BSE SME Exchange to the main Board platform of BSE Limited.

8. SHARE CAPITAL

The Authorized Share Capital of the Company as on 31/03/2020 was Rs. 13,00,00,000 and Paid up share capital of the Company as on 31/03/2020 was Rs. 12,51,52,000. There has been no such change in the Equity share capital of the Company during the year.

9. CHANGE IN NATURE OF BUSINESS, IF ANY

During the Financial Year, there has been no change in the business of the company or in the nature of Business carried by the company during the financial year under review.

10. DEPOSITS

During the year, Company has not accepted any deposits from public within the meaning of the Section 73 of the Companies Act, 2013.

Details of money received from Directors

Sr. No. Name of Directors O/s amount as on year end
1 Nikhil Harbanslal Bhatia 1,25,87,583
2 Sanjeev Harbanslal Bhatia 68,75,804

11. SUBSIDIARIES, JOINT VENTURE AND ASSOCIATE COMPANIES

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

12. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE

There was no significant material order passed by the regulators or courts or tribunals impacting the going concern status and companys operation in nature.

13. DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with Section 152(6) of the Companies Act, 2013 read with the Articles of Association of the Company, Mr. Nikhil Harbanslal Bhatia (DIN:02063706), Whole time Director, retire by rotation and is being eligible has offered himself for re-appointment at the ensuing Annual General Meeting.

Based on the confirmations received from Directors, none of the Directors are disqualified from appointment under Section 164 of the Companies Act, 2013.

The following are the List of Directors and KMP of the Company during the year:

Name of Directors Category & Designation Appointment Date Change in Designation Resignation Date
Mr. Sanjeev Harbanslal Bhatia Executive Managing Director 25.03.2008 05.01.2018 -
Mr. Nikhil Harbanslal Bhatia Executive Whole Time Director 01.04.2008 05.01.2018 -
Mr. Arpit Arunkumar Jain Non-Executive Independent Director 05.01.2018 - -
Mrs. Rashmi Kapil Arora Non-Executive Independent Director 05.01.2018 - -
Mr. Rachit Naresh Narang Non-Executive Independent Director 05.01.2018 - -
Mr.Ravindra Arunrao Sojal Chief Financial Officer 05.01.2018 - -
Ms. Avani Karansingh Chaudhari Company Secretary 11.11.2017 - 12.04.2019
Ms. Mittal Narendrabhai Shah Company Secretary 12.04.2019 - -
Mrs. Kamleshkumari Harbanslal Bhatia Non- Executive Additional Director 30.03.2020 - -

14. STATUTORY AUDITORS

M/s. R. Kejriwal & Co., Chartered Accountants (having Firm Registration No 133558W) are Statutory Auditors of the Company, who were appointed in 11thAnnual General Meeting held on 09.09.2019 holds office until the conclusion of the 13th Annual General Meeting.

15. COMMENTS ON AUDITORS REPORT

The notes referred to in the Auditor Report are self-explanatory and they do not call for any further explanation as required under section 134 of the Companies Act, 2013.

16. INTERNALAUDITOR

M/s. V. M. Patel & Associates, Cost Accountant, Surat appointed as an internal Auditor of the Company for the Financial Year 2019-2020. Internal Auditors are appointed by the Board of Directors of the Company, based on the recommendation of the Audit Committee. The Internal Auditor reports their findings on the internal Audit of the Company to the Audit Committee on a quarterly basis. The Scope of Internal audit is approved by the Audit Committee.

The Company has appointed M/s. V. M. Patel & Associates, Cost Accountant, Surat as an Internal Auditor for the term of 5 years from from F.Y. 2019-20 to 2023-24 in the Board meeting held on 30th May, 2019 after obtaining his willingness and eligibility letter for appointment as Internal Auditor of the Company.

17. EXTRACT OF ANNUAL RETURN

The Extract of Annual Return as required under section 92(3) of the Companies Act, 2013 and Rule 12 (1) of the Companies (Management and Administration) Rules, 2014 in Form MGT-9 is annexed herewith for your kind perusal and information. (Annexure - 1).

18. RELATED PARTY TRANSACTION

With reference to Section 134(3)(h) of the Companies Act, 2013, all contracts and arrangements with related parties under section 188 of the Companies Act, 2013 entered by the Company during the financial year, were in ordinary course of business and at arms length basis. Details of the related party transactions made during the year are attached as Annexure-2 in form AOC-2 for your kind perusal and information.

19. NUMBER OF MEETING HELD DURING THE YEAR

The Details of all meeting of Board of Directors and Committee meeting had taken place during the year and their details along with their attendance, is given in Annexure 3 in the Corporate Governance Report.

20. COMPOSITION OF BOARD AND ITS COMMITTEE

The detail of the composition of the Board and its committees thereof and detail of the changes in their composition if any is given in Annexure 3 in the Corporate Governance Report.

21. LOANS, GUARANTEES AND INVESTMENT

With reference to Section 134(3)(g) of the Companies Act, 2013, loans, guarantees and investments made under section 186 of the Companies Act, 2013 are as under:

Sr. No. Date of transaction Name of the Company Purpose of Transaction Amount involved in Transaction
1 Various Dates Suncare Traders Limited Loan for business development 2,55,41,799
2 Various Dates Bagh Bahar Appliances Pvt Ltd Loan for business development 3,18,68,548
3 Various Dates Manasi Sarees Private Limited Loan for business development 25,86,178

22. DECLARATION BY INDEPENDENT DIRECTORS

Company has received declaration from all the independent directors duly signed by them stating that they meet the criteria of independence as provided in section 149(6) of the Companies Act, 2013. There has been no Change in the circumstances affecting their status as Independent Directors of the Company so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant regulations.

All the independent directors have enrolled with the Indian Institute of Corporate Affairs at Manesar for exam "Online Self Assessment Test".

SEPARATE MEETING OF INDEPENDENT DIRECTORS

In terms of requirement of Schedule IV of the Companies Act, 2013, the Independent Directors of the company have complied with the code of Independent Director. Independent Directors met separately on 16th March, 2020 to inter alia review the performance of Non-Independent Directors (Including the Chairman), the entire Board and the quality, quantity and timeliness of the flow of the information between the Management and the Board.

23. VIGIL MECHANISM

The Company has adopted a Whistle Blower Policy to provide a formal mechanism to the Directors and employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Companys Code of Conduct or Ethics Policy. The Policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company have been denied access to the Audit Committee. The Whistle Blower Policy has been posted on the website of the Company at http://bhatiamobile.com/wp-content/uploads/2019/06/Vigil-Mechanism-Whistle-Blower-Policy.pdf

24. RISK MANAGEMENT

Risks are events, situations or circumstances which may lead to negative consequences on the Companys business.

Risk Management is a structured approach to manage uncertainty. An enterprise wide approach to Risk Management is being adopted by the Company and key risks will now be managed within a unitary framework. As a formal roll-out, all business divisions and corporate functions will embrace Risk Management Structure, and make use of these in their decision making. Key business risks and their mitigation are considered in the annual/strategic business plans and in periodic management reviews. The risk management process over the period of time will become embedded into the Companys business system and processes, such that our responses to risk remain current and dynamic.

25. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(5) of the Companies Act, 2013, your directors hereby confirm:

A. That in preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departments;

B. That the directors have 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 if the Company at the end of the financial year and of the profit and loss of the Company for that period;

C. That 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 for preventing and detecting fraud and other irregulations;

D. That 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.

26. ANNUAL EVALUATION

Pursuant to the applicable provisions of the Act and the Listing Regulations, the Board has carried out an Annual Evaluation of its own performance, performance of the Directors and the working of its Committees based on the evaluation criteria defined by Nomination and Remuneration Committee (NRC) for performance evaluation process of the Board, its Committees and Directors.

The performance evaluation of the board was evaluated by the board after seeking inputs from all the directors on the basis of the criteria such as participation in decision making; participation in developing corporate governance; providing advice and suggestion etc.

The Committees of the Board were assessed on the degree of fulfillment of key responsibilities, adequacy of Committee composition and effectiveness of meetings.

The board reviewed the performance of the individual directors on the basis of the criteria such as the contribution in decision making, contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive suggestions and advice in meetings, etc. In addition, the chairman was also evaluated on the key aspects of his role.

In a separate meeting of independent directors, performance of non-independent directors, performance of the board as a whole and performance of the chairman was evaluated, taking into account the views of executive directors and non-executive directors. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.

27. INTERNAL FINANCIAL CONTROL SYSTEM

The Company has a well placed, proper and adequate internal financial control system which ensures that all the assets are safeguarded and protected and that the transactions are authorized recorded and reported correctly. The internal audit covers a wide variety of operational matters and ensures compliance with specific standard with regards to availability and suitability of policies and procedures. During the year no reportable material weakness in the design or operation were observed.

28. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The companies act, 2013 re-emphasizes the need for an effective internal financial control system in the company. Rule 8(5) (viii) of Companies (Accounts) Rules, 2014 requires the information regarding adequacy of internal financial controls with reference to the financial statements to be disclosed in the board report. The detailed report forms part of Independent Auditors Report.

29. CORPORATE GOVERNANCE

Your Company has incorporated the appropriate standards for corporate governance. Pursuant to Regulation 15(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015,the Company is not required to mandatorily comply with the provisions of certain regulations of the SEBI(Listing Obligations and Disclosure Requirements) Regulations, 2015. Company is filing Corporate Governance Report to stock exchange quarterly. However, as per Regulation 34(3) read with Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 company is giving report on corporate governance report in annual report of the company. Corporate Governance Report is as per Annexure - 3.

30. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING

With reference to Section 134(3)(m) of the Companies Act, 2013, the details of conservation of energy, technology absorption and foreign exchange earnings are as per Annexure - 4.

31. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Pursuant to the provisions of section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility) Rules 2014; the Board has undertaken the CSR activities as per Rule 4 of Companies (Corporate Social Responsibility Policy) Rules, 2014. The details of CSR activities for the financial year 2019-2020 forms part of this Board report in Annexure 5.

32. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

As per Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements), Regulation 2015, the Management Discussion and Analysis Report is given in Annexure - 6.

33. SECRETERIAL AUDITOR

Your board has appointed Mr. Ranjit Kejriwal, Practicing Company Secretary, as secretarial Auditor of the company for the period of 5 consecutive years starting from financial year 2019-2020. The secretarial report for the financial year 2019-2020 is attached as Annexure-7. Report of secretarial auditor is self-explanatory and need not any further clarification.

34. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

There was no employee drawing remuneration in excess of limits prescribed under section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The Disclosure pertaining to remuneration as required under section 197(12) of the Companies Act, 2013 read with Rule of the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016 are as per Annexure - 8. The detailed remuneration policy of the Company is available on the below link: http://bhatiamobile.com/wp-content/uploads/2020/06/Remunreation-Policy-1.pdf

35. CEO/ CFO CERTIFICATION

In terms of Regulation 17(8) of the Listing Regulations, the CFO has certified to the Board of Directors of the Company with regard to the financial statements and other matters specified in the said regulation for the financial year 2019-2020. The certificate received from CFO is attached herewith as per Annexure 9.

36. CODE OF CONDUCT

Being a SME listed Company exemption has been provided to the Company from formulating of Code of Conduct for Board of Directors and Senior Management Personnel. However, Board of Directors has formulated and adopted Code of Conduct for Board of Directors and Senior Management Personnel from January 19, 2018. During the year, Board of Directors and Senior Management Personnel has complied with general duties, rules, acts and regulations. In this regard certificate from Managing Directors as required under Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 has been received by the Board and the same is attached herewith as per Annexure 10.

Code of Conduct form Board of Directors and Senior Management Personnel effective from February 15, 2018 is available on below link: http://bhatiamobile.com/wp-content/uploads/2018/08/Code-of-Conduct.pdf

37. COMPLIANCE CERTIFICATE FROM THE AUDITORS REGARDING COMPLIANCE OF CONDITIONS OF CORPORATEGOVERNANCE:

Corporate Governance is a set of process, practice and system which ensure that the Company is managed in a best interest of stakeholders. The key fundamental principles of corporate governance are transparency and accountability. At Bhatia, Companys core business objective is to achieve growth with transparency, accountability and with independency. Company has adopted various corporate governance standard and doing business in ethical way by which Company has enhance stakeholders trust, shareholders wealth creation by improving shares valuation, market capitalization, etc.

A certificate received from M/s R. Kejriwal & Co., Statutory Auditors of the Company regarding compliance of the conditions of Corporate Governance, as required under Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached herewith as per Annexure 11.

38. DISCLOSURE REGARDING UTILIZATION OF IPO FUNDS

The details regarding the funds utilized by the company from proceeds of IPO upto 30/09/2019 is attached herewith as Annexure 12. The Fund has been fully utilized on 30/09/2019 and no pending on 31/03/2020.

39. CERTIFICATION FROM COMPANY SECRETARY IN PRACTICE

Mr. Ranjit Kejriwal, Practicing Company Secretary has issued a certificate required under the listing regulations, confirming that none of the Directors on the Board of the company has been debarred or disqualified from being appointed or continuing as director of the company by SEBI/Ministry of Corporate Affairs or any such statutory authority. The certificate is enclosed as Annexure 13.

40. SEXUAL HARASSMENT OF WOMEN

Your company adopted policy of "Prevention of Sexual Harassment of Women at Workplace". There were no incidences of sexual harassment reported during the year under review, in terms of the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules made there under. The objective of this policy is to provide protection against sexual harassment of women at workplace and for redressal of any such complaints of harassment, internal complaints committee has been set up to redress the complaints, if any.

The company has complied with the provisions relating to constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.Your directors further state that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

41. SECRETARIAL STANDARDS ISSUED BY THE INSTITUTE OF COMPANY SECRETARIES OF INDIA (ICSI)

The Company complies with all applicable mandatory Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI).

42. FRAUD REPORTING

During the year under review, no fraud has been reported by Auditors under Section 143(12) of the Companies Act, 2013.

43. MAINTENANCE OF COST RECORDS

The company is not required to maintain Cost Records as specified by Central Government under section 148(1) of the Companies Act, 2013, and accordingly such accounts and records are not made and maintained.

44. INSURANCE:

All the properties and the Insurable Interest of the company Including building and stocks wherever necessary and to the extent required have been adequately insured. The company keeps reviewing the insurance amount every year as per requirement.

45. STATUTORY INFORMATION

The Company being basically engaged into the retail and whole sell distribution business of mobile handsets, tablets, data-cards, Television, mobile accessories, mobile related products and is the member of BSE SME Platform. Apart from this business, the Company is not engaged in any other business/activities.

46. APPRECIATION

Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication and commitment and express their sincere thanks and appreciation to all the employees for their continued contribution, support and co-operation to the operations and performance of the company.

47. ACKNOWLEDGEMENT:

Your Directors would like to express their sincere appreciation of the co-operation and assistance received from Shareholders, Bankers, regulatory bodies and other business constituents during the year under review.

Your Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers and staff, resulting in successful performance of the Company during the year.

Place: Surat For the Board of Director
Date:20.08.2020 Bhatia Communications & Retail (India) Limited
Sd/- Sd/-
Sanjeev Harbanslal Bhatia Nikhil Harbanslal Bhatia
Managing Director Whole Time Director
DIN: 02063671 DIN:02063706