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Khandwala Securities Ltd Directors Report

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Jul 19, 2024|09:43:38 AM

Khandwala Securities Ltd Share Price directors Report

To

The Members,

Your Directors hereby present the Thirtieth Annual Report on the business, operations and state of affairs of the Company together with the audited financial statements for the year ended 31st March 2023.

FINANCIAL HIGHLIGHTS

The summary of the Companys financial performance, for the financial year 2022-23 as compared to the previous financial year 2021-22 is given below:

(I) Standalone Financial Performance :

(Rs. in Lakhs)

Particulars

Year ended March 31, 2023 Year ended March 31, 2022
Total Income 648.63 635.14
Financial Cost 33.67 71.09
Depreciation and 29.50 28.56
Amortization Expenses
Profit / (Loss) before 49.77 6.36
Exceptional Items & Tax
Exceptional Items - -
Profit / (Loss) before Tax 49.77 6.36
Provision for Tax 5.35 (5.69)
Profit / (Loss) after Tax 44.42 12.05
Other Comprehensive 0.73 3.20
Income
Total Comprehensive 45.15 15.25
Income for the Year

(II) Consolidated Financial Performance :

(Rs. in Lakhs)

Particulars

Year ended March 31, 2023 Year ended March 31, 2022
Total Income 648.63 635.14
Financial Cost 33.67 71.09
Depreciation and 29.50 28.56
Amortization Expenses
Profit / (Loss) before 49.67 6.20
Exceptional Items & Tax
Exceptional Items - -
Profit / (Loss) before Tax 49.67 6.20
Provision for Tax 5.35 (5.70)
Profit / (Loss) after Tax 44.32 11.90
Other Comprehensive 0.73 3.20
Income
Total Comprehensive 45.05 15.10
Income for the Year

FINANCIAL PERFORMANCE

Standalone

During the year under review, the standalone total income for the financial year was Rs. 648.63 lakhs as compared to Rs. 635.14 lakhs for the previous year. The total expenses incurred during the financial year was Rs. 598.86 lakhs as compared to Rs. 628.78 lakhs in the previous year. The Net Profit after tax was Rs. 44.42 lakhs in the financial year as compared to Rs. 12.05 lakhs in the previous year.

Consolidated

During the year under review, the consolidated total income for the financial year was Rs. 648.63 lakhs as compared to Rs. 635.14 lakhs for the previous year. The total expenses incurred during the financial year was Rs. 598.96 lakhs as compared to Rs. 628.94 lakhs in the previous year. The Net Profit after tax was Rs. 44.32 lakhs in the financial year as compared to Profit of Rs. 11.90 lakhs in the previous year.

DIVIDEND

During the year under review, the Board of Directors has not recommended any dividend for the financial year ended March 31, 2023.

INFORMATION ON THE STATE OF AFFAIRS OF THE COMPANY

The nformation on operational and financial performance of the Company is given in the Management Discussion & Analysis Report, forming part of this Annual Report.

LISTING WITH STOCK EXCHANGES

The equity shares of the Company are listed on National

Stock Exchange of India Limited (NSE) and BSE Limited (BSE).

SUBSIDIARIES AND JOINT VENTURES

Your company does not have any subsidiary company or joint venture.

ASSOCIATE COMPANIES

During the year ended March 31, 2023, your Company had one associate Company i.e. Trumonee Financial Limited, within the meaning of Section 2(6) of the Companies Act, 2013.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company has been prepared in accordance with the applicable Indian

Accounting Standards. The audited consolidated financial statements together with auditors report forms part of this Annual Report. A statement containing the salient features of the financial statement of associate Company as required under Sec.129(3) of the Companies Act, 2013 in the prescribed form i.e. "Form AOC-1" is annexed as "Annexure - 1" to this report.

Further, pursuant to the provisions of Section 136 of the Companies Act, 2013, the financial statement of the Company, consolidated financial statements along with relevant documents and separate audited accounts in respect of associate company are also available on the website of the Company. The Company will also make available copy of audited accounts of the associate Company upon request by any member of the Company interested in obtaining the same. All these documents will also be available for inspection at the Registered Office of the Company till the date of ensuing Annual General Meeting of the Company.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 92 and 134 of the Companies Act, 2013 and the rules made thereunder, the extract of annual return in the prescribed format is available on the website of the Company at www.kslindia.com.

MANAGEMENT DISCUSSION AND ANALYSIS

A detailed analysis of the Companys performance is explained in the Management Discussion & Analysis Report, forming part of this Annual Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL a) Retirement by Rotation of the Directors

Pursuant to the provisions of Section 152 of the Companies Act, 2013, Mr. Pratik Khandwala retires by rotation at the forthcoming Annual General Meeting and, being eligible, offers himself for re-appointment. The Board of Directors recommends his re-appointment. b) Changes in Directors and Key Managerial Personnel

Pursuant to the recommendations of the Nomination and Remuneration Committee, the Board has appointed Mr. Shyam M. Seshadri (DIN:-05242397) and Mr. Subramanian Murlidhardas (DIN:00268983) as an Independent Directors of the Company for the first term of 5 consecutive years with effect from February 12, 2022. Accordingly, the Members of the Company vide passing resolution through Postal Ballot on May 9, 2022, approved their appointment.

Further, the Board regretfully report the sad demise of Mr. Subramanian Murlidhardas, Independent Director of the Company who passed away on December 10, 2022. The Board further express their heartfelt condolences for his untimely death and wishes to put on record their sincere and deep appreciation for his invaluable guidance and contribution, from time to time, in the Company growth. Further, pursuant to the provisions of Section 203 of the Companies Act, 2013, Mr. Paresh Khandwala, Managing Director, Mr. Pranav Khandwala, Whole-time Director and Chief Financial Officer (CFO) and Mr. Abhishek Joshi, Company Secretary are the Key Managerial Personnel of the Company as on March 31, 2023.

DECLARATION OF INDEPENDENCE

The Board has received declarations from all the Independent Directors confirming that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and are not disqualified from continuing as Independent Directors of the Company.

MEETINGS OF THE BOARD OF DIRECTORS

During the financial year, the Board met 6 (six) times i.e. 3rd May 2022, 24th May 2022, 8th July 2022, 12th August, 2022, 14th November 2022 and 13th February 2023. The attendance details of directors at the Board Meetings are provided in the Corporate Governance Report.

COMMITTEES OF THE BOARD

The Board of Directors of the Company has constituted various Committees in compliance with the provisions of the Companies Act, 2013 and SEBI Listing Regulations.

The details of the Committees along with their composition, terms of reference, no. of meeting held during the year and attendance at these meetings, are provided in the Corporate Governance Report, forming part of this Annual Report.

BOARD EVALUATION

In compliance with the provisions of the Companies

Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors has carried out an annual evaluation of its own performance, board committees and individual directors. The performance of the board and its committees was evaluated after seeking inputs from all the directors on the basis of criteria such as board effectiveness, quality of discussion, contribution at the meeting, corporate governance practices, strategic thinking, time commitment, review of the terms of reference of the committees, etc. The above criteria are based on the guidance note on Board Evaluation issued by the Securities and Exchange Board of India.

The Board and the Nomination and Remuneration

Committee reviewed the performance of the individual directors of the Company on the basis of their criteria such as effectiveness, performance, transparency, strategic thinking, quality of discussions at the meetings, etc. The performance evaluation of independent directors was done by the entire board. The Directors expressed their satisfaction with the evaluation process.

NOMINATION AND REMUNERATION POLICY

The Board has, on recommendation of Nomination and

Remuneration Committee, framed a Nomination and

Remuneration policy on appointment of Directors, key managerial personnel, senior management personnel and their remuneration including the criteria for determining qualifications, independence of directors, positive attributes, etc. The said policy is annexed to this report as "Annexure - 2.

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 Companies Act , 2013 that: (i) in the preparation of the annual accounts for the financial year ended 31st March, 2023, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any;

(ii) such accounting policies as mentioned in the notes to accounts have been selected and applied consistently and judgments 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 the Company attheendof related for the financial year and of the profit the year ended 31st March, 2023; (iii) proper and 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) the Annual accounts are prepared on a going concern basis. (v) proper internal financial controls have been laid down and the same are adequate and were operating effectively ; and (vi) proper systems had been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal financial control with reference to the financial statements. The Company has policies and procedures in place for ensuring proper and efficient conduct of its business, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information. During the year under review, the Internal Financial Controls seriouswere operating effectively observation has been received from the Auditors of the Company for inefficiency or inadequacy of such controls.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The details in respect of internal control system and their adequacy are included in the Managements Discussion and Analysis, which forms part of this annual report.

RISK MANAGEMENT

The Company has a risk management framework which not only ensures timely identification of risks, analysis of the reasons for such risk, assessment of its materiality, assessment of its impact but also adequate risk mitigation processes. The Risk management framework encompasses all areas of the Companys business. The details of risk management including identification of elements of risk and their mitigation are provided in Managements Discussion and Analysis, which forms part of this annual report. The

Audit Committee monitors the risk management plan and ensures its effectiveness.

RELATED PARTY TRANSACTIONS

All the Related Party Transactions that were entered during the financial year 2022-23 were on arms length basis and in the ordinary course of business of the Company. Thus disclosure in form AOC-2 is not required. Further, there were no materially significant transactions entered by the Company during the year which may have a potential conflict with the interest of the Company. The disclosure with related parties is set out in care for the maintenance of the notes to accounts forming part of the Annual Report.

The Company has also adopted a related party transactions policy which is available on the website of the Company.

DEPOSITS

During the year under review, the Company has neither accepted nor renewed any deposits from the public under the provision of Section 73 and other applicable provisions, if any, of the Companies Act, 2013 read with the rules made thereunder.

LOAN, GUARANTEES AND INVESTMENTS BY COMPANY

The details of loans, guarantees and investments made by the Company under the provision of Section 186 of the Companies Act, 2013, during the financial year, have been disclosed in the notes of the financial statements.

EMPLOYEES

Your Company is consciously aware that its well being largely depends upon the quality and strength of human resource. Your Company recognizes that human capital is its most valuable asset and thus endeavors to attract and retain the best available talent. Towards the end of FY 2023 your Company undertook an exercise to shrink the payroll head count to make it lean and more competitive. The

Company through constant monitoring of its milestones and goals ensures that its operations are adequately staffed and in sync with requirements. Your Companys human resource policies are designed and implemented to achieve these objectives. The Board wishes to place on record its appreciation for sincere and dedicated efforts put in by all the employees. Employee-Management relations continued to remain cordial throughout the year under review.

PARTICULARS OF EMPLOYEES

Pursuant to the provisions of Section 197(12) of Companies Act, 2013, the ratio of the remuneration of each Director to the median employees remuneration and other details in term of sub-section 12 of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are forming part of this report as "Annexure - 3". During the year under review, there was no employee was in receipt of remuneration exceeding the limits as prescribed under the provision of Section 197 of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

POLICY FOR PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

The Company has in place a policy on prevention of sexual harassment of women at workplace under the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The objective of this policy is to provide protection against sexual harassment of women at workplace and for redressal of complaints of any such harassment. During the year under review, no complaints of sexual harassment was received by the Company.

VIGIL MECHANISM/ WHISTER BLOWER POLICY

The Company has adopted a Vigil Mechanism/Whistle Blower Policy for the employees for reporting genuine concerns/grievances and reporting any unethical behavior or wrong practices such as fraud, violation of code of conduct, inappropriate behavior, etc. in the organization. This Policy provides the adequate safeguards against the victimization of the employees who use the vigil mechanism. The Vigil Mechanism/Whistle Blower Policy has been uploaded on the website of the Company at http://www.kslindia.com/Static/ KSLPolicies.aspx. The functioning of the vigil mechanism is reviewed by the Audit Committee from time to time.

PREVENTION OF INSIDER TRADING

The Company has adopted a code of practices and procedure for fair disclosure of Unpublished Price Sensitive Information for prevention of Insider Trading. The said code is in line with the provisions of the SEBI (Prohibition of Insider Trading) Regulations, 2015 and the same has been uploaded on the website of the Company at http://www. kslindia.com/Static/KSLPolicies.aspx. All the Directors and the designated employees have complied with the Code.

SECRETARIAL STANDARDS

The Company has complied with all the applicable

Secretarial Standards, issued by the Institute of Company Secretaries of India relating to meetings of the Board of Directors and General Meetings.

SHARE CAPITAL

During the year under review, the Members of the Company at their Extra-Ordinary General Meeting held on June 2, 2022 has approved the increase in Authorised Share Capital from Rs. 14,00,00,000/- (Rupees Fourteen Crores Only) divided into 1,40,00,000 (One Crore Forty Lakhs only) equity shares of Rs. 10/- (Rupees Ten Only) each to Rs. 17,00,00,000/- (Rupees Seventeen Crores Only) divided into 1,70,00,000 (One Crore Seventy Lakhs only) equity shares of Rs. 10/- (Rupees Ten Only) each.

The Authorised Share Capital of the Company as on March 31, 2023 stood at Rs. 28,00,00,000/- (Rupees Twenty Eight Crores only) divided into 1,70,00,000 (One Crore Seventy Lakhs only) Equity shares of Rs. 10/- (Rupees Ten Only) each and 5,00,000 (Five Lakhs only) Cumulative Redeemable Preference Shares of Rs. 100/- each (Rupees Hundred Only) and 4,00,000 (Four Lakhs only) Cumulative Convertible Preference Shares of Rs. 100/- each (Rupees Hundred only) and 2,00,000 (Two Lakhs only) Optionally Convertible Redeemable Preference Shares of Rs. 100/- each (Rupees Hundred Only).

Further during the year under review, the Company has allotted 33,14,805 equity shares of Rs. 10/- each to non-promoters at a price of Rs. 27/- per share, including premium of Rs. 17/- per share, on preferential basis on July 8, 2022, which was approved by the Members in the Extra-Ordinary General Meeting held on June 2, 2022.

Consequently, the paid-up share capital of the Company as at March 31, 2023 stood at Rs. 15,25,38,050/- comprising of 1,52,53,805 equity shares of Rs. 10/- each.

STATUTORY AUDITORS

Pursuant to the provisions of Section 139(2) of the Act and the rules made thereunder, the Members of the Company at their Twenty Seventh AGM held on November 23, 2020, had appointed M/s. Aniket Kulkarni & Associates, Chartered Accountants (Firm Registration No. 130521W), as the Statutory Auditors of the Company for a term of five years, i.e. from the conclusion of Twenty Seventh AGM till the conclusion of the Thirty Second AGM to be held in the year 2025.

The Reports issued by the Statutory Auditor on the Audited Financial Statements of the Company for FY 2022-23 forms part of this Annual Report. Further, the Statutory Auditors has given the qualified opinion in their audit reports and the Board has furnished required details/explanation in its note nos. 28 and 29 of notes of accounts to the Standalone Financial Statements and note nos. 30 and 31 of notes of accounts to the Consolidated Financial Statements respectively.

SECRETARIAL AUDITORS

Pursuant to the provisions of section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended from time to time, the Company had appointed

M/s. Bhuwnesh Bansal & Associates, Practicing Company Secretary, to conduct the Secretarial Audit of the Company for the financial year ended March 31, 2023. The Secretarial Audit Report for the financial year ended March 31, 2023 issued by the Secretarial Auditor has been annexed as "Annexure-4" to this report. Further, the Secretarial Auditor has not given any qualification or reservation in his Secretarial Audit Report except for a remark in relation to delay in submission of in-principal documents regarding allotment of equity shares on preferential basis with Stock Exchanges. The Company has taken the necessary steps to avoid such delay.

INTERNAL AUDITORS

Pursuant to the provisions of section 138 of the Companies Act, 2013 and the rules made thereunder, M/s. Shah & Ramaiya, Chartered Accountants was appointed as Internal Auditors of the Company for the financial year 2022-2023. The Internal Auditors have conducted the internal audit periodically and submitted their reports to the Audit Committee.

CORPORATE GOVERNANCE

A report on Corporate Governance along with a Certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance as prescribed under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 has been provided in this Annual Report.

CORPORATE SOCIAL RESPONSIBILITY

Pursuant to the provisions of section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility) Rules, 2014, the requirements of mandatory implementation of Corporate Social Responsibility activities is presently not applicable to the Company.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURT

There are no material significant material orders passed by the Regulators or Court or Tribunals which can have an impact on the going concern status and its future operations.

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

In view of the nature of activities which are being carried on by the Company, Rule 8(3) of the Company (Accounts), Rules, 2014 concerning conservation of energy and technology absorption respectively are not applicable to the Company.

Foreign Exchange Earnings and Outgo:

During the year under review, the foreign exchange earnings was Rs. 31.00 Lakhs (Previous Year was Rs. 114.00 lakhs). The foreign exchange outgo was Rs. 0.41 lakhs (Previous Year was Nil).

OTHER DISCLOSURES:

Your Directors state that no disclosure or reporting is required in respect of the following matters as there were no transactions on these matters during the financial year ended March 31, 2023:

• There has been no change in the nature of business of the Company;

• There has been no material changes and commitments affecting the financial position of the Company that occured between the end of financial year and the date of this Report;

• There was no application made or proceeding pending against the Company under the Insolvency and

Bankruptcy Code, 2016. There was no instance of one time settlement with any Bank/Financial Institution in respect of loan taken by the Company;

• No fraud has been reported by the Auditors to the Audit

Committee and the Board;

Maintenance of cost records and requirements of cost audit, as prescribed under the provision of section

148(1) of the Companies Act, 2013 are not applicable to the Company;

ACKNOWLEDGMENTS

The Board expresses its sincere gratitude for the continued support and guidance received by the Company from the Securities and Exchange Board of India, the Stock Exchanges and other government and regulatory agencies. The Board would like to acknowledge the continued support of its bankers, registrars, vendors, clients and investors. The Directors also wish to place on record their gratitude and appreciation of the employees hard work, dedication, teamwork and professionalism which has made the phenomenal growth possible year after year.

For and on behalf of the Board of Directors of

Khandwala Securities Limited

Date : May 30, 2023

Homiar N. Vakil

Place : Mumbai

Chairman

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