Moneyboxx Finance Ltd Directors Report.

To the Members,

Your directors are pleased to present the Twenty-Sixth Annual Report on the business and operations of the Company together with the Audited Financial Statements for year ended March 31, 2020.

FINANCIAL HIGHLIGHTS

A summary of the Companys financial results for the Financial Year 2019-20 is as under:-

 

(Amount in Rupees Lakhs)

PARTICULARS Current Financial Year (2019-20) Previous Financial Year (2018-19)
Revenue from Operations 417.00 199.71
Other Income - -
Profit/loss before Depreciation, Finance Costs, Exceptional items and Tax Expense (205.41) 32.93
Less: Depreciation/Amortisation/Impairment 54.40 12.18
Profit/Loss before Finance Costs, Exceptional Items and Tax Expense (259.81) 20.75
Less: Finance Cost 81.17 2.26
Profit/Loss before Exceptional Items and Tax Expense (340.98) 18.49
Add/(less): Exceptional items - -
Profit/Loss before Tax Expense (340.98)
Less: Tax Expense (Current & Deferred) 13.82 (4.75)
Profit/loss for the year (1) (354.80) 23.24
Retained earnings as at the beginning of the year (4.73) (23.57)
Profit after Tax (354.80) 23.24
Retained earnings before appropriations (359.53) (0.33)
Appropriations
Less: Transfer to reserve fund u/s 45-IC(1) of the RBI Act, 1934 - 4.40
Less: Dividend paid on Equity Shares - -
Less: Dividend Distribution Tax - -
Less: Other Appropriation 0.01 -
Retained earnings as at the end of the year (359.54) (4.73)
Earnings per share (Face value of Rs.10/-)
- Basic (Rs.) (1.77) 0.14
- Diluted (Rs.) (1.77) 0.14

COMPANYS PERFORMANCE

The Revenue from operations for the year under review has been Rs. 417.00 lakhs (Previous Year: Rs. 199.71 lakhs) registering a growth of 108.80% over the previous year. The Operating Loss stood at Rs. 340.98 lakh as against operating Profit of Rs. 18.49 lakh in the Previous Year. The Net Loss for the year stood at Rs. 354.80 lakh against Profit of Rs. 23.24 lakh in the Previous Year.

Total income during FY2020 increased to Rs. 417.00 Lakhs from Rs. 199.71 Lakhs during the year. The profit after tax for the year under review was (Rs. 354.80 Lakh) as compared to Profit of Rs. 23.24 Lakhs for as on 31 March 2019.

The Assets Under Management (AUM) as on 31 March 2020 stood at Rs. 3913.21 Lakh as compared to Rs. 1750.42 Lakh as on 31 March 2019 registering an increase of 123.56% over the previous year. Loans receivables as on 31 March 2020 were Rs. 2929.02 Lakhs as compared to Rs. 97.44 Lakhs as on 31 March 2019 registering an increase of 2905.97% over the previous year.

CIRCULATION OF ANNUAL REPORTS IN ELECTRONIC FORM

In view of the prevailing COVID-19 situation and consequent lockdown across the country, the Ministry of Corporate Affairs (MCA) has exempted companies from circulation of physical copies of Annual Report for FY2020. Accordingly, the Annual Report of the Company for FY2020 is being sent only by email to the members, and all other persons/entities entitled to receive the same. This Annual Report, along with other documents, is also available on the Companys website at www.moneyboxxfinance.com.

DIVIDEND

The Company has occurred loss during the period under review, the Board of Directors of the Company has not recommended any dividend for the Financial Year 2019-20.

RESERVES

During the period under review, no amount has been transferred to reserves.

SHARE CAPITAL

As on March 31, 2020, the Authorized Share Capital of the Company stood at Rs. 25,00,00,000/- (2,50,00,000 equity shares of Rs. 10/- each) and the Issued, Subscribed and Paid-up Share Capital of the Company stood at Rs. 20,08,16,510 divided into 2,00,81,651 equity shares of Rs. 10/- each.

During the period under review, the Company has made allotment by way of:

Bonus Shares:

The Company has issued and allotted 16,74,346 Bonus shares to the Equity Shareholders in the ratio of 1:10 (i.e. One fully paid up equity share of Rs. 10/ - each for every ten fully paid up equity shares).

Preferential issue of shares by way of Private Placement:

The Company has issued and allotted 16,63,846 shares Equity Shares of face value of Rs. 10/- each at a premium of Rs. 60/- per share aggregating to Rs. 70/- per equity share on preferential basis by way of Private Placement.

LISTING ON STOCK EXCHANGE

The Companys shares are listed on Main Platform of BSE Limited. The listing fee for the financial year 2020-21 has been paid.

MORATORIUM OF LOANS

The Reserve Bank of India, issued guidelines on 27 March 2020 permitting all commercial banks, co-operative banks, All India Financial Institutions, and NBFCs to give moratorium to customers in respect of instalments falling due between March 01, 2020 to August 31, 2020. Accordingly, the Company offered moratorium to its customers as per the policy approved by the Board.

COVID-19 PANDEMIC

The COVID-19 pandemic has caused a huge disruption creating an unprecedented impact on the financial well-being of nations, corporations and individuals. A detailed discussion on impact of COVID-19 on the NBFC sector and operations of the Company is covered in the ‘Management Discussion and Analysis.

STATE OF THE COMPANYS AFFAIRS

Migration of Equity Shares from BSE SME Platform to BSE Mainboard Platform:

The equity shares of the Company which were listed on BSE SME Platform, has now been migrated & admitted to dealings on the Main Board Platform of BSE Limited w.e.f. October 22, 2019.

Accordingly, the trading lot size of the Companys shares on the BSE browser has been reduced from 10000 shares to 1 share.

CHANGE IN THE NATURE OF BUSINESS

There have been no changes in the nature of business of the company for the period under review.

MATERIAL CHANGES AND COMMITMENT, IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY, HAVING OCCURRED SINCE THE END OF THE YEAR AND TILL THE DATE OF THE REPORT

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

CORPORATE SOCIAL RESPONSIBILITY

Your Company does not fall within the provisions of section 135 of the Companies Act, 2013 relating to Corporate Social Responsibility (CSR) provisions. Hence details of expenditures on CSR are not required to be furnished.

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

The Company does not have any subsidiary, associate or joint venture company, therefore the statement containing the salient features of the financial statement of subsidiaries, associates or joint ventures under the first proviso to sub-section (3) of section 129 in Form AOC-1 is not applicable.

DIRECTORS AND KMP

During the year under review:

Mr. PrashantAgarwal (DIN: 08019634) had resigned from the designation of Chief Financial Officer (CFO), Co-Chief Executive Officer (Co-CEO) of the Board w. e. f. June 29, 2020.

Mr. PrashantAgarwal (DIN: 08019634) had resigned from the Directorship of the company as Whole-time Director and KMP of the Company w.e.f. September 09, 2020. Your Directors express their sincere thanks and appreciation for the contribution made by him.

Mr. Mayur Modi (DIN: 08021679) was designated as Chief Financial Officer (CFO) & as a KMP of the Company w.e.f. June 29, 2020.

Mr. Mayur Modi (DIN: 08021679) had resigned as Chief Financial Officer (CFO) of the Company w.e.f. September 15, 2020.

Mr. Deepak Aggarwal (DIN: 03140334) Non-Executive – Non Independent Director of the Company was appointed and re-designated as Whole-time Director of the Company subject to the approval of shareholders in the ensuing General Meeting w.e.f. September 15, 2020 to hold office for a term of 3 (three) consecutive years.

Mr. Deepak Aggarwal (DIN: 03140334) was further designated as Chief Financial Officer (CFO), Co-Chief Executive Officer (Co-CEO) & as a KMP of the Company w.e.f. September 15, 2020. Pursuant to the provisions of Section 161(1) of the Companies Act, 2013 and the Articles of Association of the Company:

Mr. Atul Garg (DIN: 07093376) was appointed as additional Director of the Company w.e.f. September 15, 2020 and holds office up to the date of the ensuing Annual General Meeting. Board recommends their appointment as Director of the Company.

Director retiring by rotation:

Mr. Govind Gupta (DIN: 00065603), Director retires by rotation from the Board, pursuant to the provisions of section 152(6) (c) of the Companies Act, 2013 and, being eligible, offers himself for reappointment.

The Board recommends the appointment of Mr. Govind Gupta (DIN: 00065603) as Director of the Company retiring by rotation.

During the year under review, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than rent paid, sitting fees and reimbursement of expenses incurred by them for and on behalf of the Company.

As required under regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the information on the particulars of the Directors proposed for appointment / reappointment has been given in the Notice of the Annual General Meeting.

As on date, the Company had 6 Directors and 3 Key Managerial Personnel.

S. No. Name of Director Designation
1. Mr. Uma Shankar Paliwal Chairman cum Independent Director
2. Ms. Ratna Dharashree Vishwanathan Independent Director
3. Mr. Deepak Aggarwal Whole-time Director Chief Financial Officer & Co- Chief Executive Officer (KMP)
4. Mr. Mayur Modi Whole-time Director Co- Chief Executive Officer (KMP)
5. Mr. Govind Gupta Non-Executive Director
6. Mr. Atul Garg Non-Executive Director
7. Ms. Radhika Garg Company Secretary & Compliance Officer (KMP)

NUMBER OF MEETINGS OF THE BOARD

The Board met 5 times during the financial year. The meeting details are provided in the ‘Corporate Governance Report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days, as prescribed in the Companies Act, 2013.

COMMITTEES OF THE BOARD

There are four (4) committees constituted by the Board:

1. Audit Committee

2. Nomination and Remuneration Committee

3. Stakeholder Relationship Committee

4. Executive committee

AUDIT COMMITTEE

The details pertaining to the composition of the Audit Committee are included in the Corporate Governance Report, which is a part of this report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Act, the Board of Directors, to the best of its knowledge and ability, confirm that:

i. in the preparation of the annual accounts, the applicable accounting standards have been followed alongwith proper explanation relating to material departures, if any;

ii. they 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 of the Company at the end of the financial year and of the profit & loss of the Company for the financial year 2019-20 ;

iii. they have 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. they have prepared the annual accounts on a going concern basis.

v. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and vi. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively

DECLARATION BY INDEPENDENT DIRECTORS

The independent directors have submitted a declaration of independence, stating that they meet the criteria of independence provided under section 149(6) of the Act, as amended, and regulation 16 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. There has been no change in the circumstances affecting their status as independent directors of the Company.

The Board took on record the declaration and confirmation submitted by the independent directors regarding them meeting the prescribed criteria of independence, after undertaking due assessment of the veracity of the same in terms of the requirements of regulation 25 of the SEBI Listing Regulations.

POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION

The current policy is to have an appropriate mix of executive, non-executive and independent directors to maintain the independence of the Board, and separate its functions of governance and management. As of March 31, 2020, the Board had six members, two of whom are executive Directors, two are non -executive and non-independent member and two non-executive independent directors. One of the Independent directors of the board is woman.

The policy of the company on directors appointment and remuneration, including the criteria for determining qualifications, positive attributes, independence of a director and other matters, as required under sub-section (3) of section 178 of the Companies Act,2013 is available on our website at http://moneyboxxfinance.com/images/pdf/Nomination-Remuneration-policy.pdf

We affirm that the remuneration paid to the directors is as per the terms laid out in the Nomination and Remuneration Policy of the Company.

BOARD EVALUATION

The Board adopted a formal mechanism for evaluating its performance and as well as that of its Committees and individual Directors, including the Chairman of the Board. The Board of Directors has carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Act and SEBI Listing Regulations. The performance of the board & its committees was evaluated by the board after seeking inputs from all the directors on the basis of criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc.

In a separate meeting of independent directors, performance of non-independent directors and the board as a whole was evaluated, taking into account the views of executive directors and non-executive directors.

DEPOSITS

Your Company has not invited/received/accepted any fixed deposits during the year, as such, no amount of principal or interest on fixed deposits was outstanding on the date of Balance Sheet. Therefore, the disclosures as required under the Companies Act, 2013 and the Rules framed thereunder and RBI Directions are not applicable.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report as required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is provided in a separate section and forms an integral part of this Report.

PARTICULAR OF EMPLOYEES

In accordance with the provisions of Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement containing the disclosures pertaining to remuneration and other details as required under the Act and the above Rules, are appended to this Report as Annexure - A.

The statement containing particulars of employees as required under Section 197 of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 will be provided upon request. In terms of Section 136 of the Companies Act, 2013, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees particulars which is available for inspection by the members at the Registered Office of the Company during business hours on working days of the Company.

If any member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.

EXTRACT OF ANNUAL RETURN

The extract of annual return as provided under section 92(3) of the Act, in the prescribed form no. MGT-9 would be available at the website of the Company at www.moneyboxxfinance.com.

HUMAN RESOURCES

To the Company, its people are a very valuable resource. In an increasingly competitive market for talent, the Company continues to focus on attracting and retaining right talent. It is committed to provide right opportunities to employees to realise their potential.

During the year, the Company had conducted structured familiar interactions between the employees of the Company and imparted programmes with regard to sharing information about the Companys long term perspective, its growth along with the growth of employees.

The Company had also conducted the training programme with respect to AML/CFT areas which inter alia includes familiarization with the AML/CFT guidelines issued by the Reserve Bank of India (RBI) from time to time.

CORPORATE GOVERNANCE

Your Company practices a culture that is built on core values and ethical governance practices. Your Company is committed to transparency in all its dealings and places high emphasis on business ethics. The Report on Corporate Governance for the Financial Year ended March 31, 2020 along with the certificate from the Statutory Auditors of the Company confirming the compliance with regulations of corporate governance under the SEBI Listing Regulations is annexed to the Report on Corporate Governance and forms part of this Report.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has a Whistle Blower Policy to report genuine concerns or grievances & to provide adequate safeguards against victimization of persons who may use such mechanism.

There was no reporting made by any employee for violations of applicable laws and regulations and the Code of Conduct for the F.Y. 2019-20.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has put in place adequate internal controls with reference to accuracy and completeness of the accounting records and timely preparation of reliable financial information, commensurate with the size, scale and complexity of operations and ensures compliance with various policies and statutes in keeping with the organizations pace of growth, increasing complexity of operations, prevention and detection of frauds and errors. The design and effectiveness of key controls were tested and no material weaknesses were observed. The Audit Committee reviews and evaluates the adequacy of internal financial control and risk management systems, periodically. Efficacy of Internal control systems are tested periodically by Internal Auditors with and Internal Control over financial reporting is tested and certified by Statutory Auditors.

The internal financial control system of the Company is supplemented with internal audits, regular reviews by the management and checks by external auditors.

The Statutory Auditors of the Company have audited the internal financial controls over financial reporting of the Company as of March 31, 2020 in conjunction with audit of the financial statements of the Company for the year ended on that date and Annexure ‘A to the Auditors Report may be referred to in this regard.

AUDIT AND AUDITORS

(a) Statutory Auditor

At the 25th AGM held on September 30, 2019 the Members approved appointment of Gaur & Associates, Chartered Accountants (Firm Registration No. 005354C) as Statutory Auditors of the Company to hold office for a period of five years from the conclusion of the 25th AGM till the conclusion of the 30th AGM for the financial year starting from April 01, 2019 to March 31, 2024.

There is no qualification, reservation or adverse remark for the year under review.

(b) Secretarial Auditor

Pursuant to the provisions of Section 204 of the Act and rules made thereunder, the Company had appointed Messrs Shashank Sharma & Associates, a firm of Company Secretaries in Practice (C.P No. 7221) to undertake the Secretarial Audit of the Company. The Secretarial Audit Report for the financial year ended as on March 31, 2020 is annexed as Annexure B and forms an integral part of this Report.

There is no qualification for the year under review.

COST AUDIT

As per the provisions of Section 148 read with the Cost Audit Rules, the provisions regarding Cost Audit is not applicable to the Company.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

The Company, being a non-banking financial company registered with RBI and engaged in the business of giving loans, is exempt from the provisions of section 186 of the Act in respect of loans and guarantees. Accordingly, the disclosures of the loans given as required under the aforesaid section have not been made in this Report.

RELATED PARTY TRANSACTIONS

All related party transactions entered during FY 2019-20 were on an arms length basis and in the ordinary course of business under the Act and were entered with the approval of the Audit Committee/Board of Directors in line with provisions of the Act and SEBI Listing Regulations. There was no materially significant related party transaction under the Act or the SEBI Listing Regulations, which had a potential conflict with the interest of the Company at large. None of the transactions required members prior approval under the Act or the SEBI Listing Regulations. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3) (h) of the Companies Act, 2013 in Form AOC 2 is not applicable. The Directors draw attention of the members to Note No. 27 of the Notes to the Financial Statements which sets out related party transactions.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS / OUTGO

Particulars regarding conservation of energy & technology absorption as required to be disclosed pursuant to the Rule 8(3) of the Companies (Accounts) Rules, 2014 are as under.

(A) Conservation of Energy-

(i) the steps taken or impact on conservation of energy The Companys operations involve low energy consumption and wherever possible, energy conservation measures have already been implemented.
(ii) the steps taken by the company for utilising alternate sources of energy Efforts to conserve and optimize the use of energy through improved operational methods and other mean will continue as an on-going basis.
(iii) the capital investment on energy conservation equipments NA

(B) Technology absorption-

(i) the efforts made towards technology absorption Since the company is primarily engaged in NBFC activities the minimum technology required for the business has been absorbed.
(ii) the benefits derived like product improvement, cost reduction, product development or import substitution NA
(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)- NA
(a) the details of technology imported;
(b) the year of import;
(c) whether the technology been fully absorbed;
(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof; and
(iv) the expenditure incurred on Research and Development. NA

(C) Foreign exchange earnings and Outgo-:

There were no foreign exchange earnings and outgo during the year under review (previous year): NIL

RISK MANAGEMENT

The Board of Directors have adopted a risk management policy for the Company which provides for identification, assessment and control of risks which in the opinion of the Board may threaten the existence of the Company. The Management identifies and controls risks through a properly defined framework in terms of the aforesaid policy.

REPORTING OF FRAUDS BY AUDITORS

There was no instance of fraud during the year under review, which required the Statutory Auditors / Secretarial Auditors to report to the Audit committee and / or Board under Section 143(12) of the Act and the rules made thereunder.

SECRETARIAL STANDARDS OF ICSI

Your Directors confirm that the Secretarial Standards issued by the Institute of Company Secretaries of India, as applicable on the Company have been complied with.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

During the year under review, no significant and material orders were passed by any regulator or court or tribunal impacting the going concern status and Companys operations in future.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has adopted a Policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder.

The Company has also formed an Internal Complaints Committee which is responsible for redressal of complaints related to sexual harassment and follows the guidelines provided in the policy.

The Company has not received any complaints on sexual harassment during the year.

ACKNOWLEDGEMENT

The Directors express their sincere gratitude to the Reserve Bank of India, Securities and Exchange Board of India, BSE Limited, Ministry of Finance, Ministry of Corporate Affairs, Registrar of Companies, other government and regulatory authorities, lenders, financial institutions and the Companys bankers for the ongoing support extended by them. The Directors also place on record their sincere appreciation for the continued support extended by the Companys stakeholders and trust reposed by them in the Company. The Directors sincerely appreciate the commitment displayed by the employees of the across all levels, resulting in successful performance during the year.