To,
The Members
Your Directors have pleasure in presenting their Twenty Ninth (29th) Annual
Report on the business and operations of the company along with the Audited Financial
accounts for the Financial Year ended 31st March, 2023..
FINANCIAL RESULTS
(Amount in Lacs)
| Particulars |
Year Ended 31st March 2023 |
Year Ended 31st March 2022 |
| Total Revenue |
2286.51 |
1227.93 |
| Less: Operating Expenses & Provisions |
2285.68 |
1255.36 |
| Profit/(Loss) before Tax |
0.83 |
(27.43) |
| Less: Provision for Taxation |
0 |
0 |
| Profit/(Loss) after Tax |
0.83 |
(27.43) |
| Comprehensive Income/(Loss) |
0 |
0 |
| Profit/(Loss) After Tax (PAT) including Other |
0.83 |
(27.43) |
| Earnings per Share (EPS) (Rs.) |
0.01 |
(0.30) |
REVIEW OF OPERATION
During the financial year under review total income of the Company is Rs. 2286.51 Lacs
as compared to last years total income of Rs 1227.93 Lacs. Company has earned profit of
Rs. 0.83 lacs as compare to loss of Rs. 27.43 lacs of the previous year, before
comprehensive income/(loss).
BUSINESS REVIEW
Explicit Finance Limited ("The Company") is a non-banking financial company
engaged in Secondary capital market activities and also provide a wide range of services
including: -
• Individual/Corporate Finance
• Loans against Shares and securities
• Loans against property
• Financial Consultancy Services
DIVIDEND
Due to insufficient profits the Board of Directors has not recommended any dividend.
MANAGEMENT DISCUSSION ANALYSIS REPORT
The Management Discussion and Analysis forms an integral part of this Report and gives
details of the overall industry structure, economic developments, performance and state of
affairs of your Companys various businesses, internal controls and their adequacy, risk
management systems and other material developments during the financial year 2022-2023.
A. INDUSTRY STRUCTURE & DEVELOPMENT RISKS AND CONCERNS
NBFC is amongst highly regulated sectors and is exposed to market risk and liquidity
risk. In the present economic situation in country and globally all the financial
institutions are at very heavy risk. The secondary market is also highly volatile and with
unstable trends of market it is also pro risk area.
For controlling inflation RBI keeps on changing norms periodically which impacts
working pattern and cash flow.
OPPORTUNITIES
Micro financing and unsecured consumer loans are emerging as new avenue and with
increasing purchasing power and having direct nexus to working population the available
consumer base is very huge and number of NBFC/Banks/Fis catering in the area are not
sufficient to cater the demand resulting in favourable demand and supply ratio for NBFCs
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
Internal Control measures and systems are established to ensure the correctness of the
transactions and safe guarding of the assets. Considering the size and nature of
activities, the company has adequate internal control system covering both accounting and
administrative control. In addition the internal audit is carried out periodically. The
management ensuring an effective internal control system so that the financial statements
and reports give a true and fair view and during the year under review no material or
serious observation has been received from the Internal Auditors of the Company for
inadequacy or ineffectiveness of such control.
B. HUMAN RESOURCES
The company always regards human resources as its most valuable asset and continuously
evolves policies and process to attract and retain its substantial pool of managerial
resources through friendly work environment that encourages initiatives by individuals and
recognizes their performance.
C. CAUTIONARY NOTE
Certain Statements in the Management Discussion and Analysis describing the companys
views about the industry, expectations, objectives, etc. may be understood forward
looking statement within the meaning of applicable laws and regulations. Factors like
changes in Government regulations, tax laws and other factors such as industrial relations
and economic developments etc. may further influence the companys operations or
performance. Actual results may differ substantially or materially from those expressed or
implied.
RESERVES
The reserves are transferred in accordance with statutory provisions(s)
SHARE CAPITAL
The Company had not issued any equity shares either with or without differential rights
during the F.Y. 2022-2023 and hence, the disclosure requirements under Section 43 and Rule
4 (4) of the Companies (Share Capital and Debentures) Rules, 2014, are not applicable.
DEPOSITS
The Company has neither accepted nor renewed any deposits from public or members during
the year under review under Section 73 of the Companies Act, 2013 read with Chapter V of
the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. There are
no unclaimed deposits, unclaimed / unpaid interest, refunds due to the deposit holders or
to be deposited to the Investor Education and Protection Fund as on 31st March,
2023.
DIRECTORS
In accordance with the provisions of the Companies Act, 2013 and articles of
association of the Company
a) Mr. Rajesh Nanda, (DIN: 06399927) (Managing Director)of the company, for a term of
five years from August 14, 2023.
b) Ms. Hetal Bhanushali (DIN : 10266055) is appointed as an Independent Director under
category of additional director w.e.f. August 14, 2023.
The resolutions regularizing their appointment is in the notice convening 29th
Annual General Meeting enclosed with this annual report.
CHANGES IN KEY MANAGERIAL PERSONNEL (KMPS) DURING THE YEAR 2022-2023
The CFO Ms. Taruna Ghanekar has resigned and Mr. Siddhesh patil has been appointed as
CFO of the company.
Mr. Siddhesh patil has experience in Finance sector for more then a decade at the
senior position and will be adding value to the organization with his expertise and
experience going hand in hand.
The CFO of the Company has resigned and Company has appointed new CFO Mr. Sidarth Patil
on 15-07- 2023.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(3)(c) & 134(5) of the Companies Act, 2013, the Board of
Directors of the Company hereby confirm that:
i. in the preparation of the annual accounts, the applicable accounting standards have
been followed along with proper explanation relating to material departures;
ii. 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 of the company at the end of the financial year and of
the loss of the company for that period;
iii. proper and sufficient care has been taken 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;
iv. proper annual accounts have been prepared on a going concern basis;
v. internal financial controls to be followed by the company and that such internal
financial controls are adequate and were operating effectively; and
vi. proper systems to ensure compliance with the provisions of all applicable laws and
that such systems were adequate and operating effectively.
DECLARATION BY INDEPENDENT DIRECTOR
All Independent Directors have submitted the declaration of Independence, as required
pursuant to Section 149(7) of the Act, stating that they meet the criteria of Independence
as provided in section 149(6) of the Companies Act, 2013 and are not disqualified from
continuing as Independent Directors.
EVALUATION OF DIRECTORS, COMMITTEE AND BOARD
Pursuant to the provisions of the Companies Act, 2013 and the Listing Regulations, the
Board of Directors has carried out evaluation of the Board, its Committees and Individual
Directors. The evaluation process has been explained in the Report on Corporate
Governance, which forms part of this Boards Report.
Also, the Independent Directors, at their meeting reviewed the performance of the
Board, its Chairman and Non-Executive Directors of the Company.
NUMBER OF BOARD MEETINGS HELD DURING THE PERIOD
A notice of the Board Meeting is circulated well in advance with Agenda, including
detailed explanation to be discussed, to enable the Board to take an informed decision.
The intervening gap between the meetings was within the period prescribed under the
Companies Act, 2013 and the Listing Agreement/Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015. Further, 04 (Four)
Board Meetings were held during the year ended
31st March 2023, the dates are 30-05-2022, 13-08-2022, 14-11-2022 and
14-02-2023. Detailed information on the Board Meetings with regard to attendance of each
of the Directors thereat have been included in the Corporate Governance Report, which
forms part of this Board Report.
Additionally, during the financial year ended 31st March 2023 a separate
meeting of the Independent Directors was held on 14-02-2023, in compliance with the
requirements of Schedule IV of the Companies
Act, 2013 and Regulation 25(3) and 25(4) of the Listing Regulations
Post the Independent Directors Meeting, the collective feedback of each of the
Independent Director was scaled and measured on defined ratings, thereby covering the
performance of Board as a whole, performance of the non-independent directors and
performance of the Chairman.
COMMITTEES OF THE BOARD
The Board of Directors of your company has constituted various committees in compliance
with the provisions of the Companies Act, 2013 and Listing Regulations.
• Audit Committee
• Nomination & Remuneration Committee
• Stakeholder Relationship Committee
All decisions pertaining to the constitution of Committees, appointment of members and
fixing of terms of reference/ role of the committees are taken by the Board of Directors.
A detailed note on the Board and its Committees is provided under the Corporate Governance
Section in this Annual Report.
NOMINATION & REMUNERATION POLICY
The Board has, on the recommendation of the Nomination & Remuneration Committee
framed a policy for selection and appointment of Directors, Senior Management and their
remuneration. The appointment and Remuneration Policies stated in the Corporate Governance
Report of the Company that forms part of the Annual Report.
PARTICULARS OF EMPLOYEES AND REMUNERATION
Information as required under the provisions of Section 197(12) of the Companies Act,
2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 (including any statutory modification(s)/amendment(s)/re-enactment thereof,
for the time being in force), is set out in Annexure-I hereto, which forms part of this
Boards Report.
DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANY
The Company does not have any subsidiary or associate company and has not entered into
joint venture with any other company during the financial year ended 31st March
2023. Accordingly, a statement under the provisions of Section 129(3) of the Companies
Act, 2013, containing salient features of the financial statements of the Companys
subsidiary(ies) in Form AOC-1 is not enclosed.
CORPORATE GOVERNANCE REPORT
As stipulated under the provision of Regulation 34 (3) read with Schedule V (c) of the
SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 a separate report
on Corporate Governance Report forms integral part of this Board Report. The requisite
compliance certificate as required under Part E of Schedule V of the Listing Regulation is
issued by the Auditors, pertaining to the compliance of the conditions of Corporate
Governance is Annexed thereto.
EXTRACT OF ANNUAL RETURN
The extract of the Annual Return pursuant to the provisions of Section 92 read with
Rule 12 of the Companies (Management and Administration) Rules, 2014 is annexed herewith
as Annexure -II to this report.
STATUTORY AUDITORS
M/s S C Mehara & Associates LLP, Chartered Accountants (FRN:106156W) were appointed
as the Statutory Auditors of the Company in the 24th AGM held on 14th
September, 2018 for a period of five years as per the provisions of Section 139 of the
Companies Act, 2013.
As er the provisions of the Companies act, 2013 along with applicable rules and
regulations for the appointment and term of Statutory Auditors of the Company can be
appointed for a maximum if 10 years divided into the five years term at once (five
consecutive years).
The statutory auditors have completed their first term of five years with financial
year ending on March 31, 2023. The auditors have declared their unwilling ness owing to
their pre-occupation and on completion of first term to be re-appointed as Statutory
Auditor of the Company.
The board has proposed appointment of M/s. GMCS & Co., Chartered Accountants, (Firm
Reg. No: 141236W) as a statutory auditor of the company, for a term of five consecutive
years starting from Financial Year 2023-24 till the Annual General Meeting for the year
ended March 31, 2028.
The resolution proposing their appointment is annexed to the notice convening Annual
General Meeting of the meeting along with this report.
AUDITORS REPORT Independent Auditors Report
There are no qualifications, reservation or adverse remark or disclaimer in the
Independent Auditors Report provided by M/s. S C Mehra & Associates LLP, Chartered
Accountants, for the F.Y. 2022-2023. The notes to accounts forming part of financial
statements are self-explanatory and need no further clarification.
Secretarial Audit Report
Pursuant to Provision of Section 204 of the Companies Act, 2013 and Rules framed there
under Board of Directors have appointed M/s. Vishal Manseta, Practicing Company
Secretaries to conduct Secretarial
Audit. The Secretarial Audit Report for the Financial Year ended 31st March
2023 forms the integral part of the Board Report as Annexure-III. There are no
qualifications, reservation or adverse remark or disclaimer in Secretarial Audit Report.
Details in respect of frauds reported by auditors under sub-section (12) of section 143
other than those which are reportable to the central government
There are no such frauds committed by the Company which are reported by auditors.
PARTICULARS OF LOANS, GUARAUNTEES OR INVESTMENTS
Pursuant to Section 186 (11) of the Companies Act, 2013 read with Rule 11(2) of the
Companies (Meetings of Board and its Powers) Rules, 2014, the loan made, guarantee given
or security provided in the ordinary course of business by a Non- Banking Financial
Company (NBFC) registered with Reserve Bank of India are exempt from the applicability of
provisions of Section 186 of the Act.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
All related party transactions that were entered into during the financial year were on
arms length basis and were in the ordinary course of the business. There are no
materially significant related party transactions made by the company with Promoters, Key
Managerial Personnel or other designated persons which may have potential conflict of
interest with the company at large. Accordingly disclosures of related party transactions
in Form AOC-2 have not been furnished. All Related Party Transactions were placed before
Audit Committee and Board for their approval. Your Company has formulated policy of
Related Party Transaction which is also available on the website of the Company.
MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY
No material changes and commitments which could affect the Companys financial position
have occurred till date of this report.
TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND
The Company does not have any funds lying unpaid or unclaimed for a period of seven
years. Therefore there were no funds which were required to be transferred to Investor
Education and Protection Fund (IEPF).
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
• Conservation of Energy & Technology Absorption
The Company is not engaged in manufacturing activities and therefore provisions
relating to conservation of energy and technology absorption are not applicable to it.
However, efforts are being made to minimize consumption of energy, wherever possible.
• Foreign Exchange Earnings and Outgo
During the year under review there were no Foreign Exchange earnings and outgo.
RISK MANAGEMENT POLICY
The Board of Directors of the Company has approved Risk Management policy and
guidelines, wherein all material risks faced by the company are identified and assessed.
Moreover in the said Risk Management Policy the Board has defined a structured approach to
manage uncertainty, cultivating the same in their decision making pertaining to all
business divisions and corporate functions. For each of the risks identified,
corresponding controls are assessed and policies and procedures are put in place for
monitoring, mitigating and reporting on periodic basis.
CORPORATE SOCIAL RESPONSIBILITY
The provisions of Corporate Social Responsibility are not applicable to the company as
company does not fall into ambit of the provisions of section 135 of Companies Act, 2013
and Companies (Corporate Social Responsibility Policy) Rules, 2014.
ADEQUACY OF INTERNAL FINANCIAL CONTROL WITH REFERENCE TO FINANCIAL STATEMENTS
In respect of internal financial control, the Board has adopted the policies and
procedures for ensuring the orderly and efficient conduct of its business, including
adherence to the Companys policies, the safeguarding of its assets, the timely prevention
and detection of frauds and errors, the accuracy and completeness of the accounting
records and the timely preparation of reliable financial information. Further, the
management regularly reviews the control for any possible changes and takes appropriate
actions.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The details in respect of internal control systems and their adequacy are included in
the Management Discussion and Analysis Report, which forms part of this report.
CHANGES IN NATURE OF BUSINESS, IF ANY
During the year under review there is no change in the nature of business of the
Company.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
In pursuant to the provisions of section 177(9) and (10) of the Companies Act, 2013, a
Whistle Blower Policy / Vigil Mechanism for directors and employees to report genuine
concerns has been established by the Company in order to maintain highest standards of
ethical, moral and legal conduct, adopted Vigil Mechanism/Whistle Blower policy to provide
an avenue to its employees to raise concerns of any violations of legal or regulatory
requirements, incorrect or misrepresentations of any financial statements and reports,
etc. The Audit committee of the company oversees the said mechanism from time to time.
None of the Company personnel has been denied access to the Audit Committee. The Whistle
Blower Policy of the Company is also available on the website of the Company www.explicitfinance.net
DISCLOSURE UNDER THE HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND
REDRESSAL) ACT, 2013
The company has in place an Anti-Harassment policy in line with the requirements of the
sexual harassment of women at the workplace (Prevention, Prohibition & Redressal) Act,
2013. Internal Complaints Committee (ICC) has been set up to redress complaints received
regarding sexual harassment. All employees (permanent, contractual, temporary, trainees)
are covered under this policy. During the year under review, company has not received any
Sexual Harassment Complaints. Company has zero tolerance policy in case of sexual
harassment at workplace and is committed to provide a healthy environment to each and
every employee of the company.
RBI GUIDELINES
The company continues to comply with all the requirements prescribed by the Reserve
Bank of India from time to time as applicable.
SIGNIFICANT ORDERS PASSED BY REGULATORS, COURTS OR TRIBUNALS IMPACTING GOING CONCERN
AND COMPANYS OPERATIONS
No orders have been passed by any Regulator or Court or Tribunal which can have an
impact on the going concern status and the Companys operations in future.
COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD AND GENERAL MEETING
Pursuant to Clause 9 of the Revised Secretarial Standard-1(SS-1) and Standard-2 (SS-2),
your company has complied with applicable Secretarial Standard issued by the Institute of
Company Secretaries of India during the financial year under review.
ACKNOWLEDGEMENT
The Directors takes this opportunity to thank all their colleagues at Explicit Finance
Ltd. for their professionalism and dedication to the task at hand. The board also wishes
to place on record their appreciation for valuable support given by the Bankers, Clients
and Shareholders.
| For and on behalf of the Board of Directors |
| Gopal Dave |
| DIN :00334120 |
+91-9892691696
