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Capital Trade Links Limited.
Your Directors delightfully present the 33rd Annual Report on the business and operation of the Company together with the Audited Financial Accounts for the year ended 31st March, 2018.
|(Rs. in Lacs)|
|Revenue from Operations||383.76||922.32|
|Less: Operational and Other Expenses||240.05||769.1|
|Profit/(Loss) before Depreciation & Finance Cost||175.37||153.53|
|Less: Depreciation & Amortization||2||0.83|
|Less: Finance Cost||35.83||43.64|
|Profit/(Loss) before Tax||137.54||109.89|
|Less: Tax and Adjustments||43.23||32.75|
|Net Profit after Tax||94.31||77.14|
For the year ended March 2018, your Company had earned a total income of Rs. 415.42 lakhs as compared to Rs. 922.63 lakhs in the previous year. However the Net Profit of the Company has increased to Rs. 94.31 lakhs against the Net Profit of previous year for Rs. 77.14 lakhs.
DIVIDEND ON EQUITY SHARES
Your Board is pleased to recommend a dividend of Rs. 0.10 per equity share on the paid up Equity Share Capital of the Company for the FY ended March 31, 2018 which is subject to the approval of the Members.
As per section 45 IC of Reserve Bank of India Act, 1934, the Company has transferred Rs. 18.86 Lakhs in reserve fund i.e aggregating of 20% of its net profit.
NATURE OF BUSINESS
Your Company is one of the growing NBFCs in the country with strong presence in North India and offers a wide range of financial services to many sectors. Your company is a non deposit accepting Non Banking Financial Company registered with Reserve Bank of India and obtained certificate of registration no. B-14.02516 dated 19.11.2001.Your Company has adopted a client centric operations methodology that involves direct contact with clients through group trainings and various meetings of group members with center leader which occur at regular intervals. The Companys operations methodology also includes various pre-defined criterion for area selection, village selection and client selection which we believe helps us mitigate and minimize our operational risks. It has been our strategy to maximize our reach to financially excluded population, which we intend to achieve with the support of our technology-enabled business model. As a part of our effort to improve efficiency and reduce business risks, we are moving towards cashless delivery model in partnership with various institutions.
The Company is principally engaged in the business of advancing loans and financing. The Company offers credit facilities to individuals and business clients in low, medium and high range. The Company offers business loans, loans against property and fulfills working capital requirement, among others, of its individual, partnership firms, entrepreneurs, body corporate/business clients and other legal entities. The Company offers various products and services, which include venture capital, equity financing, personal loan and secured loan. E-rickshaw financing has become a major contributor to the revenue of the Company during the Financial Year 2017-18.
The Directors are quite hopeful to achieve new milestones of achievement in the years to come.
MISSION AND VALUE:
Capital Trade Links Limited aims to be the go-to financial institution for the unbanked population in the near future. With the focus on client satisfaction, we plan to encourage self-sufficiency and entrepreneurship in the various clients that we serve.
There is no change in the nature of business of the Company during the year under review. the company portfolio comprises business loans, loans against property and fulfills working capital requirement, among others, of its individual, partnership firms, entrepreneurs, body corporate/business clients and other legal entities. E-rickshaw financing has become a major contributor to the revenue of the Company during the Financial Year 2017-18.
The Company has proper procedures for the identification of borrower, due diligence, verification & assessment of borrowers income to ensure timely repayment.
The Borrower has to give Guarantee along with PDCs. The Agent also stands as guarantor and the commission to agent is paid after recovery of loan fully.
CTL is an organization providing monetary advantage to individuals and organizations, which are in need of finance. Similar to bank, the Company is extending credit facilities to individuals, business entities whether proprietorship, partnership firms, companies or any other legal entity.
The money is advanced for both personal and commercial purpose. Instead of borrowing funds from bank, the Company has been generating funds from market financial resources. The company has established its own standards and norms for evaluating different needs of its clients and always provides suitable payment option considering no harm to its customers as well as recoverable easily.
The organization is also distributing various Mutual Funds like Equity, Debt, Hybrid, ETF, Liquid funds, etc.
PRODUCTS & SERVICES:
The Company has plan to sell following products and services to potential clients
During previous financial year (2016-17), the Company granted business loan and Loan against Property. During the Financial Year 2017-18, the loans were given for purchase of E-Rickshaw, Personal Loans, Business Loan, Loan against Property.
The Company is proposing to introduce new products like Vehicle Loan also and loan against E-Rickshaw, Personal Loans, Business Loan, Loan against Property will also continue.
During Financial Year 2017-18, there was no change in the capital structure of the Company. As on 31st March 2018, the paid up share capital of the Company was Rs. 5,09.8 lakhs comprising of 5,09.8 lakhs equity shares of Re. 1/- each. The Company has not issued shares with differential voting rights nor granted stock options nor sweat equity.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
As required under Regulation 34 of Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015 ( Listing Regulations ) and Circular/ Notifications/
Directions issued by Reserve Bank of India from time to time, the Management Discussion and Analysis of the financial condition and result of consolidated operations of the Company for the year under review is presented in a separate section forming part of the Annual Report.
We wish to inform the members that in terms of Regulation 15 (2) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, Corporate Governance is not applicable to Companies having paid up equity share capital not exceeding Rs. 10 crore and Net Worth not exceeding Rs. 25 crore, as on the last day of the previous financial year. The Company does not fulfill any of the criterias as mentioned above and hence are not required to comply with the Corporate Governance provisions as envisaged under SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015. However, your Company has formed various committees in order to keep the checks and balances on the business operations of the Company.
Being a Non Deposit taking Non-Banking Financial Company, your Company has not accepted any deposits from the public under section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014 during the year under review.
RBIS NORMS AND STANDARDS
The Company continues to have a conservative provisioning policy which is significantly more stringent than the RBI norms. It fulfils and often exceeds norms and standards laid down by the RBI relating to the recognition and provisioning of non performing assets, capital adequacy, statutory liquidity ratio, etc
MEETINGS OF THE BOARD
During the year Four Board Meetings were convened and held and the intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.
The dates on which the Board Meetings were held are 29th May, 2017, 12th August, 2017, 14th November, 2018 and 14th February 2018.
COMMITTEES OF BOARD
In accordance with the Companies Act, 2013 and Listing Regulations, the Company has following Committees in place:
Nomination and Remuneration Committee Stakeholders Relationship Committee Risk Management Committee
Details of the said Committees along with their charters, composition and meetings held during the financial year, are provided separately, as a part of this Annual Report.
DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL APPOINTED OR RESIGNED DURING THE YEAR RETIREMENT BY ROTATION
In accordance with the provisions of the Companies Act, 2013, Mr. Krishan Kumar Nagpal and Mr. Abhay Kumar have been appointed as an Additional Director during the year which is subject to regularization at the forthcoming 33rd Annual General Meeting.
Further Mr. Vinay Kumar Chawla retire by rotation at the forthcoming 33rd Annual General Meeting and being eligible, offered themselves for reappointment.
Further Term of Mr. Amarnath as Independent Director is expiring at the ensuing 33rd Annual General Meeting and Board recommends his re-appointment as Independent Director for a further period of five years.
Definition of Independence of Directors is in conformity with Section 149(6) of the Companies Act, 2013 and the requirements of Listing Regulations. Based on the confirmation / disclosures received from the Directors and on evaluation of the relationships disclosed, the following Non-Executive Directors are Independent in terms of Section 149(6) of the Companies Act, 2013 and the requirements of Listing Regulations :-
1. Mr. Amar Nath
2. Ms. Jagrati Sethi
3. Mr. Neeraj Kumar Bajaj
4. Mr. Abhay Kumar
The independent directors have submitted the declaration of independence, as required under section 149(7) of the Companies Act, 2013, stating that they meet the criteria of independence as provided in section 149(6) of the Companies Act, 2013.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 134(5) of the Companies Act, 2013, with respect to Directors
Responsibility Statement, it is hereby stated 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 have selected such accounting policies and applied them consistently and made judgements 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 and loss of the company for that period; (c) the Directors have 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 have prepared the annual accounts on a going concern basis;
(e) 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; and (f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
ANNUAL EVALUATION OF THE BOARD
Pursuant to the provisions of the Act and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out an annual evaluation of its performance, the Directors individually as well as the evaluation of the working of its Audit and Nomination & Remuneration Committees. The following are some of the broad issues that are considered in performance evaluation: Criteria for evaluation of Board and its Committees:
Setting up of performance objectives and performance against them
Boards contribution to the growth of the Company
Whether composition of the Board and its Committees is appropriate with the right mix of knowledge and skill sufficient to maximize performance in the light of future strategy
Boards ability to respond to crisis
Board communication with the management team
Flow of quality information to the Board
Criteria for evaluation of Independent Directors
Demonstrates willingness to devote time and effort to understand the Company and its business
Demonstrates knowledge of the sector in which the Company operates
Quality and value of their contributions at board meetings
Contribution to development of strategy and risk management policy
Effective and proactive follow up on their areas of concern
Criteria for evaluation of Non-Independent Directors
Knowledge of industry issues and exhibition of diligence in leading the organization
Level of attendance at the Board and Committee meetings where he/she is a member
Effectiveness in working with the Board of Directors to achieve the desired results
Providing direction and support to the Board regarding its fiduciary obligations and governance role
Providing well-balanced information and clear recommendations to the Board as it establishes new policies
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS:
The Company, being a non-banking finance Company registered with the Reserve Bank of India and engaged in the business of giving loans, advancing of monies, and other kind of financings such as E-rickshaw financing etc. is exempt from complying with the provisions of section 186 of the Companies Act, 2013. Accordingly, the disclosures of the loans given as required under the aforesaid section have not been given in this Report.
MATERIAL CHANGES AND COMMITMENTS
There have been 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 and the date of this Report.
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION:
The Company, being a non banking finance Company (NBFC), does not have any manufacturing activity. The directors therefore, have nothing to report on conservation of energy and technology absorption and is given as Annexure I to this report.
DETAILS OF MANAGERIAL REMUNERATION
Details of Managerial remuneration along with required information is explained along with Annexure II to this report.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return as required pursuant to 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 as Annexure II to this Directors Report.
PARTICULARS OF EMPLOYEES:
During the year under review, there were no employees drawing remuneration of Rs. 60,00,000/- p.a. or Rs. 5,00,000/- p.m. or more. Hence there is no information to be provided in accordance with the provisions of Section 134 of the Companies Act, 2013 read with the Companies (Particulars of employees) Rules, 1975.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
As per the criteria laid down under the Companies Act, 2013 and the Rules made thereunder, Your Company is not required to form a CSR Committee and to spend minimum amount towards the CSR activities But It understand its accountabilities towards its society or the environment and as a result it took parts in various CSR activities & initiatives.
No Foreign currency expenditure was incurred during FY 2017-18. The Company did not have any foreign exchange earnings.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS
The Company has documented its internal financial controls considering the essential components of various critical processes, physical and operational which include its design, implementation and maintenance along with periodical internal review of operational effectiveness and sustenance. This ensures orderly and efficient conduct of its business, including adherence to Companys policies, safeguarding of its assets, prevention of errors, accuracy and completeness of the accounting records and the timely preparation of reliable financial information.
The internal financial controls with reference to the financial statements were adequate and operating effectively.
RELATED PARTY TRANSACTIONS
During the FY 2017-18, there are no materially significant related party transactions made by the Company with the Promoters, Key Management Personnel or other designated persons which may have potential conflict with interest of the Company at large.
PREVENTION OF INSIDER TRADING
The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate in securities by the Directors and designated employees of the Company. The Code prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed.
WHISTLE BLOWER POLICY/VIGIL MECHANISM
The Company has established a Whistle Blower Policy and Vigil Mechanism for Directors and employees to report to the appropriate authorities concerns about unethical behaviour, actual or suspected, fraud or violation of the Companys code of conduct policy and provides safeguards against victimization of employees who avail the mechanism and also provide for direct access to the Chairman of the Audit Committee.
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 have been no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and companys operations in future.
Although as per the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the formation of Risk Management Committee is not mandatory on the Company but in todays era it is better to have Risk Management Committee as a preventive measure for handling the uncertain events/risks. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The Audit Committee has additional oversight in the area of financial risks and controls. The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continual basis.
OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
In order to prevent Sexual Harassment of Women at Workplace a new act The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 has been notified on 9th December, 2013. Under the said Act every Company is required to set up an Internal Complaints Committee to look into complaints relating to sexual harassment at work place of any women employee.
The Company has adopted Anti-Sexual Harassment Policy and constituted an Internal Committee as required under section 4 (1) of Sexual harassment of women at work place (prevention, prohibition and redressal) Act, 2013.
ANNUAL EVALUATION BY THE BOARD:
The evaluation framework for assessing the performance of Directors comprises of the following key areas:
1. Attendance of Board Meetings and Board Committee Meetings
2. Quality of contribution to Board deliberations
3. Strategic perspectives or inputs regarding future growth of Company and its performance
4. Providing perspectives and feedback going beyond information provided by the management
5. Commitment to shareholder and other stakeholder interests
The evaluation involves Self-Evaluation by the Board Member and subsequently assessment by the Board of Directors. A member of the Board will not participate in the discussion of his / her evaluation.
PRESENTATION OF FINANCIAL STATEMENTS
The financial statements of the Company for the year ended 31stMarch 2018 have been disclosed as per Schedule III to the Companies Act, 2013.
The Company does not have any subsidiary Company.
MATERIAL CHANGES AND COMMITMENTS
During the year under review, there are no material changes and commitments made by the Company between the end of the financial year of the company to which the financial statements relates and the date of the report.
The Company has electronic connectivity with both depositories namely Central Depository Services (India) Limited and National Securities Depository Limited. As on March 31, 2018, 96.93% of the Companys paid-up share capital representing 4,94,16,377 equity shares is in dematerialized form (including promoters shareholding). In view of the numerous advantages offered by the Depository system, Members holding shares in physical mode are requested to avail of the facility of dematerialization of the Companys shares on either of Depositories.
M/s A.C. Gupta & Associates, Chartered Accountants, was appointed by the Company as the Auditors in the Annual General Meeting held on 30th September, 2014 for a period of five years in terms of the provisions of Section 139(2) of the Companies Act, 2013 read with Rules made thereunder. Accordingly, the Auditors, hold office until the conclusion of the Annual General Meeting to be held in the year 2019. The Statutory Auditors have submitted a certificate confirming their eligibility under Section 139 of the Act and meet the criteria for appointment specified in Section 141 of the Act. Further, the Company has also received a copy of Peer Review Certificate as prescribed by the Institute of Chartered Accountant of India to the Auditors and declaration from the Auditors that they are not disqualified for such appointment/ reappointment under the said Act. In terms of the provisions of Section 139(1) of the Companies Act, 2013 it was required to ratify the appointment of Statutory Auditor every year by the shareholders of the Company during the tenure of appointment. Further, due to notification of some of the provisions of the Companies (Amendment) Act, 2017 on May 7, 2018, the requirement of ratification of appointment of Statutory Auditors by members has been done away with. Hence, it is no longer required to ratify the appointment of Statutory Auditors at every Annual General Meeting by the members of the Company.
The Notes on accounts and observations of the Auditors in their Report on the Accounts of the Company are self explanatory. There are no observations (including any qualification, reservation, adverse remark or disclaimer) of the Auditors in their Audit Reports that may call for any explanation from the Directors.
DISCLOSURE ABOUT COST AUDIT
The Central Government has not prescribed the maintenance of Cost records under section 148(1) of the Companies Act, 2013, for any of the services rendered by the Company.
SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s A. K. Popli & Company, Company Secretaries to undertake the Secretarial Audit of the Company for the FY 2017-18. There are no observations of the Secretarial Auditors in their Audit Report that may call for any explanation from the Directors.
Directors responsibility statement as required by section 134(5) of the Companies Act, 2013 appears in this report.
Disclosures as prescribed by Non Banking Financial (Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007 and other NBFC regulations have been made in this Annual Report. A Cash Flow Statement for FY2017-18 is attached to the Balance Sheet.
We are grateful to the Government of India, the Reserve Bank of India, the Securities and Exchange Board of India, the Stock Exchanges and other regulatory authorities for their valuable guidance and support and wish to express our sincere appreciation for their continued co-operation and assistance. We look forward to their continued support in future.
We wish to thank our bankers, investors, customers and all other business associates for their support and trust reposed in us.
Your Directors express their deep sense of appreciation for all the employees whose commitment, cooperation, active participation, dedication and professionalism has made the organizations growth possible.
Finally, the Directors thank you for your continued trust and support.
|By Order and on behalf of the board|
|For CAPITAL TRADE LINKS LIMITED|
|Place: Delhi||Vinay Kumar Chawla|
|Dated: 30.05.2018||Whole Time Director|