First Custodian Fund(I) Ltd Directors Report

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First Custodian Fund(I) Ltd Share Price directors Report

TO THE MEMBERS OF

THE FIRST CUSTODIAN FUND (INDIA) LIMITED

The Directors take pleasure in presenting the Thirty - Seventh Annual Report together with the Audited Financial Statements for the year ended 31st March, 2023.

1. FINANCIAL RESULTS

Key highlights of the financial results for The First Custodian Fund (India) Limited for the financial year 2022 - 23 is tabulated below:

(Rs. in Lacs)

PARTICULARS

Year Ended 31/03/2023 Year Ended 31/03/2022

Gross Income

122.08 186.10

Total Expenditure

43.31 41.88

Finance Cost

13.53 5.51

Gross Profit Before Depreciation

65.24 138.71

Depreciation

9.85 8.73

Profit / (Loss) Before Tax

55.39 129.98

Less : Income Tax

7.15 27.69

Less /Add : Deferred Tax

(1.33) 1.77

Net Profit / (Loss) After Tax

46.91 100.52

Add : Profit brought forward from previous year

1,009.23 908.71

APPROPRIATIONS

0.00 0.00

Profit Carried Forward to Balance Sheet

1,056.14 1,009.23

There was no revision in the Financial Statements.

2. HIGHLIGHTS OF PERFORMANCE

• Total income for the financial year 2022 - 23 was Rs. 122.08 lakhs as against Rs. 186.10 lakhs earned in the previous financial year 2021 - 22 i.e. decrease by 34.41 %.

• Total Profit before Tax for the financial year 2022 - 23 was Rs. 55.39 lakhs as against Rs. 129.98 Lacs earned in the previous financial year 2021 - 22 i.e. decrease by 57.38%.

3. TRANSFER TO RESERVES

The Board of Directors has not recommended transfer of any amount to reserves.

4. DIVIDEND

Your Directors are pleased to recommend a final dividend @ 10% i.e. of Re. 1 per equity share of Rs. 10 each for the financial year ended 31st March, 2023 subject to the approval of the Members at the 37th Annual General Meeting. The total outgo for the current year amounts to Rs. 15 lakhs. (In the previous year, it was Nil).

5. BUSINESS OPERATIONS

Your Company is a member of National Stock Exchange (NSE) registered as Stock Broker and carrying on the business in brokerage in shares. Your Company is an investor in shares and also trades in futures & options. There was no change in nature of business of your Company, during the year under review.

6. DISCLOSURES UNDER SECTION 134 (3) (l) OF THE COMPANIES ACT. 2013

No material changes and commitments which could affect your Companys financial position have occurred between the end of the financial year of your Company i.e. 31st March, 2023 and date of this report i.e. 30th May, 2023.

7. SHARE CAPITAL

The paid up Equity Share Capital as on 31st March, 2023 was Rs. 1,50,00,000/-. During the year under review, your Company has not issued shares with differential voting rights nor granted stock options nor sweat equity. There was no change in your Companys share capital during the year under review. The Promoter and Promoter Group are holding 7,88,571 shares equivalent to 52.57% of the total Issued and Paid-up Share Capital.

8. DIRECTORS

8.1 Retirement by Rotation

Pursuant to Section 152 (6) of the Companies Act, 2013 and in terms of the Articles of Association of your Company, Mr. Manish Banthia (DIN: 00117002), Director retires by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment.

During the financial year, there are no changes in the composition of the Board of Directors.

8.2 Key Managerial Personnel

The following persons have been designated as Key Managerial Personnel of your Company pursuant to Section 2 (51) and Section 203 of the Act, read with Rule 8 (5) (iii) of the Companies (Accounts) Rules, 2014 framed thereunder:

1. Mr. Manish Banthia, Whole - Time Director & Chief Financial Officer

2. Mr. Giriraj Dammani, Managing Director

3. Ms. Sudha Jodhani, Company Secretary and Compliance Officer*

None of the Key Managerial Personnel have resigned during the year under review.

None of the Directors have attained the age of 75 years.

8.3 Meetings of the Board

During the year your Company has held 4 (Four) Board Meetings which were held on 30th May, 2022, 12th August, 2022, 14th November, 2022 and 14th February, 2023. The maximum interval between any two meetings has not exceeded 120 days. As per Section 167 (1) (b), all the directors have attended atleast one Board Meeting held during the financial year.

9. PARTICULARS OF EMPLOYEES

During the Financial year, there was no employee in receipt of remuneration as prescribed in the Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

10 DIRECTORS RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:

a) that in the preparation of the Annual Financial Statements for the year ended 31st March, 2023, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b) that such accounting policies as mentioned in Note 3 to the Financial Statements have been selected and applied consistently and judgement and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company as at 31st March, 2023 and of the profit of your Company for the year ended on that date;

c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities;

d) that the Annual Financial Statements have been prepared on a going concern basis;

e) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;

f) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

11. INTERNAL CONTROL SYSTEMS

Your Company maintains an adequate and effective Internal Control System commensurate with its size and complexity. We believe that these internal control systems provide, among other things, a reasonable assurance that transactions are executed with Management authorization and that they are recorded in all material respects to permit preparation of financial statements in conformity with established accounting principles and that the assets of your Company are adequately safeguarded against significant misuse or loss.

12. COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES. JOINT VENTURES OR ASSOCIATE COMPANIES

There are no companies which have become or ceased to be its Subsidiaries, Joint Venture or Associate Companies during the financial year 2022 - 23.

13. DEPOSITS

Your Company has not accepted deposit from the public and shareholders falling within the ambit of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. Hence, the requirement for furnishing details of deposits which are not in compliance with the Chapter V of the Act is not applicable.

14. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The details of loans, given and investments made covered under the provisions of Section 186 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014 are given in the notes to the Financial Statements. During the financial year, the Company has not given any guarantee or provided any security against loan given under the provisions of Section 186 of the Companies Act, 2013.

15. RELATED PARTY TRANSACTIONS

A Related Party Policy has been adopted by the Board of Directors for determining the materiality of transactions with related parties and dealings with them.

Further, the members may note that your Company has not entered into the following kinds of related party transactions:

- Contracts / arrangement / transactions which are not at arms length basis

- Any Material contracts / arrangement / transactions [as per Regulation 23 of the SEBI (LODR) Regulations, 2015]

16. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

The criteria prescribed for the applicability of Corporate Social Responsibility under Section 135 of the Companies Act, 2013 is not applicable to your Company.

17. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134 (3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is as under:

A. Conservation of Energy, Technology absorption, adaptation and innovation

Your Company is not engaged in any manufacturing activity. Your Company is in service industry.

Hence, your Company has not taken any energy conservation measures. There are no additional investments and proposals, for reduction of consumption of energy. Your Company has not deployed any Research and Development facility or absorbed any technology. Hence, no disclosures are required to be given.

18. BUSINESS RISK MANAGEMENT

Your Company is a member of National Stock Exchange (NSE) registered as Stock Broker and carrying on the business in brokerage in shares. Your Company is an investor in shares and also trades in futures & options. The inheritant risks to the business of your company are as follows:

a. Monetary Policy of the Country

b. Interest Rate Cycle

c. Fluctuation in crude oil and commodity prices

d. Changes in Government policies

e. Status of Indian & World Economy

The nature of risk is dynamic of business and entrepreneurship. Your Company has not formed Risk Management Committee since it is not applicable under Regulation 21 of the SEBI (LODR) Regulations, 2015.

19. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has established a vigil mechanism policy to report concern about unethical behavior. Protected disclosures can be made by a whistle blower to report actual or suspected frauds and mismanagement.

20. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of your Company and its future operations.

21. AUDITORS

21.1 Statutory Auditors

The members of the M/s. Paresh D. Shah & Co., Chartered Accountants are the statutory auditors of the Company at its 36th Annual General Meeting held on 30th September, 2022 for a term of 5 years. They shall hold office of statutory auditors from the conclusion of 36th AGM till the conclusion of 41st AGM and shall pursue statutory audit for 5 financial years beginning from 31st March, 2023.

In view of the amendment to Section 139 of the Companies Act, 2013, the Company is not required to ratify the re-appointment of the Statutory Auditor at every Annual General Meeting. Hence, the item of ratification of re-appointment of Statutory Auditor is not considered in this Annual General Meeting. In view of the same M/s Paresh D. Shah & Co., Chartered Accountants will continue to act as Statutory Auditors of the Company for Financial Year 2023 - 24.

B. Foreign Exchange Earning & Outgo

Foreign Exchange Earnings/Outgo

(Rs. In Millions)

Foreign Exchange Earned

Nil

Foreign Exchange Outgo

Nil

21.2 Statutory Auditors Observations

The Report given by the Auditors on the financial statements of your Company is part of the Annual Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Report.

21.3 Secretarial Audit

In terms of the provisions of Section 204 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has appointed M/s. P P Shah & Co., Practicing Company Secretaries as Secretarial Auditors for conducting Secretarial Audit of your Company for the financial year ended 31st March, 2023.

The report of the Secretarial Auditor is attached as "Annexure A". The Secretarial Audit Report does not contain any qualification, reservation or adverse remark except provided at point 21.4 below.

21.4 Qualifications in Secretarial Audit Report

A. Constitution of Audit Committee & Nomination and Remuneration Committee:

As per Section 177 and 178 of the Act, the Company is required to constitute Audit Committee & Nomination and Remuneration Committee. The Company has not constituted Audit Committee & Nomination and Remuneration Committee. In this regard the management of the Company has provided the following reply:

(i) The Volume and Nature of business is very small. The Company does not have the function of Audit Committee & Nomination and Remuneration Committee.

B. Appointment of Internal Auditor:

As per Section 138 of the Act, the Company is required to appoint Internal Auditor. The Company has not appointed Internal Auditor. In this regard the management of the Company has provided the following reply:

(i) The size of operation of the Company is very small, accordingly, it is not viable to appoint Internal Auditor but the Company has established the internal control system.

C. Website Posting:

As per the various sections of the Companies Act, 2013, regulations of the SEBI (LODR) Regulations, 2015 and Secretarial Standard - 2, the Company is required to post various information / policies on the website of the Company. The Company has not posted some of the information / policies on the website of the Company. In this regard the management of the Company has provided the following reply:

(i) The Company is filing regularly all the information with BSE and all the information is available on the website of BSE.

D. Separate Meeting of Independent Directors and Performance Evaluation:

As per Section 178 read with Schedule IV of the Companies Act, 2013, the Company is required to convene a separate meeting of Independent Directors. The Company is also required to conduct performance evaluation of its Chairman, Committees, Executive and Non Executive Directors including Independent Directors. The Company has not convened a separate meeting of Independent Directors. The Company has also not conducted performance evaluation of its Chairman, Board, Committees, Executive and Non Executive Directors including Independent Directors.

In this regard the management of the Company has provided the following reply:

(i) The Company has not appointed Independent Directors since the volume and nature of business of the Company is very small.

(ii) Since no independent director appointed in the Company, no performance evaluation was done.

E. Composition of Board of Directors:

The present constitution of Board of Directors is represented by 2 Executive Director and 1 Non-Executive Promoter Director. As per Section 149 of the Companies Act, 2013, the Company is required to appoint Independent Director and Woman Director. The Company has not appointed Independent Director and Woman Director. In this regard the management of the Company has provided the following reply:

(i) The Volume and Nature of business is very small. Therefore, it is not viable to appoint Independent Director and Woman Director.

22. REPORTING OF FRAUDS BY AUDITORS

During the year under review, neither the statutory auditors nor the secretarial auditors have reported to the Audit Committee of the Board, under Section 143 (12) of the Act, any instances of fraud committed against your Company by its officers or employees, the details of which would need to be mentioned in this Report.

23. COST RECORDS

The provisions of Section 148 of the Companies Act, 2013 and Companies (Cost Records and Audit) Rules, 2014 (hereinafter referred to as Rules) in respect of maintenance an audit of cost records are not applicable to Company.

24. COMPLIANCE OF SECRETARIAL STANDARDS

The Board of Directors affirms that your Company has complied with the applicable Secretarial Standards (SS) issued by the Institute of Companies Secretaries of India (SS1 and SS2), respectively relating to Meetings of the Board, its Committees and General Meeting, which have mandatory application during the year under review.

25. EXTRACT OF ANNUAL RETURN

Pursuant to the provisions of Section 92 (3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the extract of the Annual Return in Form MGT - 9 of your Company for the financial year ended 31st March, 2023 is annexed herewith as "Annexure B".

26. GREEN INITIATIVES

In view of Covid 19 pandemic, the Ministry of Corporate Affairs vide its circular no. 17 / 2020 dated 13th April, 2020, circular no. 20 / 2020 dated 5th May, 2020 and circular No. 10/2022 dated 28th December, 2022 and SEBI vide its circular bearing reference no. SEBI/HO/CFD/CMD1/CIR/ P/2020/79 dated 12th May, 2020 and no. SEBI/HO/CFD/PoD-2/P/CIR/2023/4 dated 5th January, 2023 has dispensed with the requirement of sending hard copy of full annual report to the shareholders.

Electronic copies of the annual report for the financial year 2022 - 23 and notice of the 37th Annual General Meeting (AGM) are sent to all members whose email addresses are registered with your Company / Depository Participant(s).

Members who have not registered their email address can do so by following the steps as mentioned in the notes of notice of 37th Annual General Meeting. Alternatively, if they need the soft copy of the annual report, they are requested to download the same from the website of the Company i.e. www.firstcustodianfund.com or from the website of BSE Limited i.e. www.bseindia.com or write to the Company at sudha iodhani@vahoo.in.

Your Company provides e-voting facility to all its members to enable them to cast their votes electronically on all resolutions set forth in the Notice. This is pursuant to the Section 108 of the Companies Act, 2013 and Rule 20 of the Companies (Management and Administration) Amendment Rules, 2015.

27. MANAGEMENT DISCUSSION AND ANALYSIS

Your Com pany is an investor in shares and also trades in futures & options. The size of operation of your Company is very small. Hence, your Company has decided not to provide Management Discussion and Analysis Report for the financial year ended 31st March, 2023.

28. CORPORATE GOVERNANCE

As per Regulation 15(2) of the SEBI (LODR) Regulations, 2015, the provisions of Corporate Governance are non-mandatory to the following class of Companies:

a. 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;

Provided that where the provisions of Regulation 27 becomes applicable to a company at a later date, such company shall comply with the requirements of Regulation 27 within six months from the date on which the provisions became applicable to the company.

b. Companies whose equity share capital is listed exclusively on the SME and SME- ITP Platforms.

The Paid-up Share Capital of your Company is Rs. 1.50 Crores as on 31st March, 2023. The Reserves and Surplus is Rs. 10.73 crores. Accordingly, the paid-up capital and net worth is below the prescribed limit for mandatory applicability of Corporate Governance clause as per Regulation 15(2)(a) of the SEBI (LODR) Regulations, 2015. Your Company has decided not to opt for compliance of Regulation 27 for the time being.

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

Your Company firmly believes in providing a safe, supportive and friendly workplace environment - a workplace where our values come to life through the supporting behaviours. Positive workplace environment and a great employee experience are integral part of our culture. Your Company believes in providing and ensuring a workplace free from discrimination and harassment based on gender.

Your Company educates its employees as to what may constitute sexual harassment and in the event of any occurrence of an incident constituting sexual harassment, your Company provides the mechanism to seek recourse and redressal to the concerned individual subjected to sexual harassment.

Your Company has a Sexual Harassment Prevention and Grievance Handling Policy in place to provide clarity around the process to raise such a grievance and how the grievance will be investigated and resolved. An Internal Complaints Committee has been constituted in line with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

No complaint has been raised during the year ended 31st March, 2023.

30. WTD (CFO) AND MD CERTIFICATION

Certificate from Mr. Manish Banthia, Whole - Time Director & Chief Financial Officer and Mr. Giriraj Dammani, Managing Director, pursuant to provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, for the year under review was placed before the Board of Directors of your Company at its meeting held on 30th May, 2023. The certificate is attached and form part of this Report.

31. CERTIFICATION FROM COMPANY SECRETARY IN PRACTICE

Mr. Pradip Shah of M/s. P P Shah & Co., Practicing Company Secretaries, has issued a certificate as required under the SEBI (LODR) Regulations, 2015, confirming that none of the Directors on the Board of your Company have been debarred or disqualified from being appointed or continuing as Director of companies by the SEBI / Ministry of Corporate Affairs or any such statutory Authority. The certificate is attached and form part of this Report.

32. INSOLVENCY AND BANKRUPTCY CODE

No application has ever been filed against the Company under the Insolvency and Bankruptcy Code, 2016.

33. ONE TIME SETTLEMENT WITH BANKS

The Company has not made any settlement with banks or financial institutions.

34. LISTING WITH STOCK EXCHANGES

Your Company is listed with BSE Limited and your Company has duly paid the listing fees to the Exchange.

35. ACKNOWLEDGEMENTS

Your Directors thank the various Central and State Government Departments, Organizations and Agencies for the continued help and co-operation extended by them. The Directors also gratefully acknowledge all stakeholders of your Company viz. customers, members, banks and other business partners for the excellent support received from them during the year. The Directors place on record their sincere appreciation to all employees of your Company for their unstinted commitment and continued contribution to your Company.

36. CAUTIONARY STATEMENT

Statements in the Boards Report describing your Companys objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement.

For and on behalf of the Board of Directors

Manish Banthia Giriraj Dammam
Whole - Time Director Managing Director
and Chief Financial Officer DIN: 00333241
DIN : 00117002

Place: Mumbai

Date: 30th May, 2023.

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