Modern Shares & Stockbrokers Ltd Directors Report

* Previous year figures regrouped recast wherever applicable

2. BUSINESS ACTIVITIES AND OPERATIONS

The Companys operations resulted in a profit of Rs. 44.18 Lakhs as against Profit of Rs. 15.95

Lakhs in the previous year, after providing for depreciation of Rs 3.15 lakhs (previous year Rs. 2.71 Lakhs) and making net provision for taxation of Rs.14.72 Lakhs as against (previous year Rs 4.65 Lakhs), Your Board of Directors has decided not to transfer any amount to the Reserves for the year under review in view of the marginal profit incurred during the year.

The year 2023-24 was a good one for your company. The profits have been growing steadily since Covid. Globally we have seen markets do well. This has been a positive given the political turmoil in the middle east and Northern Europe. The markets have had a steady rise in the last financial year which has helped the company overall in generating revenues. While Institutional business remains the key driver for our revenues, in the last year we have seen good growth in our retail business too. The company has also done some of its own investments which have helped in boosting overall profits.

The Indian Stock markets continue to grow and we are witnessing record volumes in the derivative segment. We are witnessing a stark change in the markets. For years the FIIs have been the main drivers/buyers in Indian equities. In the last year we have seen the Domestic Mutual Funds share in the stock market rise to new highs; in contrast the FPIs holdings is at a 12-year low. The SIP monthly contribution into Mutual funds is now at 20000 crores every month. We are witnessing strong buying in the midcap and small cap stocks and thus the overall stock market value is also at a record high.

Last year the fear was rising Inflation and rates. While Inflation has cooled off from the highs, rates have remained steady. Markets move on and do adjust to the rising rates in the long run. However, there are fears in the developed markets such as USA where there is a concern for rising delinquencies in the mortgage market and also credit card defaults.

The Indian economy continues to grow at a steady pace. We have recorded one of the highest GDP growths worldwide in the last year and expectation of the same to continue in the current year too. The government continues to emphasize on infrastructure spending and growth and we are expecting this trend to continue post the general elections.

3. DIVIDEND

The Board of Directors has decided not to recommend any dividend on the Equity Shares of the Company during the year under review.

4. DIRECTORS

In accordance with the Articles of Association of the Company, Mr. Ghansham Shewakramani

(DIN: 00413343) who is longest in the office retires by rotation and being eligible for re-appointment and has indicated his willingness to serve, if reappointed.

Pursuant to Section 152(6) of the Companies Act, 2013 and the Articles of Association of the Company, approval of members is also being sought for his reappointment as Non-Executive Director on the Companys Board.

BothIndependentDirectorshavegivendeclaration that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 25 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Mr. Pankaj Rajnikant Ved (DIN: 00207079) was re-appointed as an Non-Executive Independent Director of the Company on 15^th March, 2024 for a Second Consecutive Term of Five Years commencing from April 1, 2024 upto March 31, 2029 (both days inclusive) through Special Resolution passed through Postal Ballot.

5. DEPOSITS

The Company has not accepted any deposits falling under the ambit of Section 73 of the Companies Act, 2013 (hereinafter referred to as ‘The Act) and the Rules framed thereunder during the year under review.

6. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 25 (4) & 26 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration, and Stakeholders

& Grievance Committees. The manner in which the evaluation has been carried out has been explained herein below:

A structured questionnaire was prepared after inputs received from the Directors, covering various aspects of the Boards functioning such as adequacy of the composition of the Board and its committees, Board culture, execution and performance of specific duties, obligation and governance. A separate exercise was carried out to evaluate the performance of Individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution,independentjudgment,safeguarding the interest of the Company and its stakeholders, etc. The performance evaluation of Independent Directors was carried out by the entire Board. The performance of Non-independent Directors was carried out by the Independent Directors who also reviewed the performance of the compliance department and had expressed their satisfaction with the evaluation process.

? Number of Board Meetings held:

The Board of Directors duly met 5 (Five) times during the financial year from 1st April, 2023 to 31st March, 2024. The dates on which the meetings were held are as follows:

? Relevant Details of Directors

? Attendance of Directors at Board Meetings and Virtual Annual General Meeting held through VC/ OAVM:

? Stakeholder & Grievance Committee Member:

? Nomination & Remuneration Committee Member:

? Independent Directors(in Person)

7. 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(5)(c) of the Companies Act, 2013: a) that in the preparation of the Annual Financial Statements for the year ended March 31, 2024, 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 Notes to the Financial Statements have been selected and applied consistently and judgment 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 as at March 31, 2024 and of the profit of the 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 the 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 systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively and f) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

8. BUSINESS RISK MANAGEMENT

Although the Company has long been following the principle of risk minimization as is the norm in every industry, it has now become a compulsion. Therefore, in accordance with Regulation 21 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Board members were informed about risk assessment and minimization procedures after which the Board formally adopted steps for framing, implementing and monitoring the risk management plan for the Company.

The main objective of this policy is to ensure sustainable business growth with stability and to promote a pro-active approach in reporting, evaluating and resolving risks associated with the business. In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, in order to guide decisions on risk related issues. In todays challenging and competitive environment, strategies for mitigating inherent risks in accomplishing the growth plans of the Company are imperative. The common risks inter alia are: Regulations, competition, Business risk, Technology obsolescence, Investments, retention of talent and expansion of facilities. Business risk, inter-alia, further includes financial risk, political risk, fidelity risk and legal risk.

As a matter of policy, these risks are assessed and steps as appropriate are taken to mitigate the same.

9. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit (IA) function is to maintain its objectivity and independence, the Internal Audit function reports to the Chairperson of the Audit Committee of the Board.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies of the Company. Based on the report of internal audit function, each department undertakes corrective action in their respective areas and thereby strengthens the controls.

Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

In order to strengthen the system of Internal Control and provide Board of Directors with an added ability to oversee internal controls, Internal Financial Control (IFC) system was put in place in accordance with the requirements of Section 134(5)(e) of the Companies Act, 2013. Systems of Internal Control were implemented, considering the framework suggested in Guidance Note on Audit of Internal Financial Controls over the Financial Reporting issued by The Institute of Chartered Accountants of India, to address its operational and financial risk.

In pursuant to the provisions of Section 177(9)

All related party transactions that were entered into during the financial year were on an arms length basis and were in the ordinary course of business. An omnibus approval was taken for one (1) year from Audit Committee and Board at their Meeting held on 19/05/2023. There are no materially significant Related Party Transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company. None of the Directors have any pecuniary relationships or transactions vis-?-vis the Company.

In compliance under the provisions of the Companies Act, 2013, transactions with related parties entered by the Company in the normal course of business are periodically placed before the Audit Committee for its omnibus approval and the particulars of contracts entered during the year in Form AOC-2 is enclosed as Annexure- A to this report.

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

M/s.BDG&CoLLP(FormerlyknownasBDG

& Associates), Chartered Accountants (Firm Reg. No. 119739W) have been appointed as Statutory Auditor of the Company at the Annual General Meeting held on September

23, 2022 for a period of five (5) years up to the conclusion of the Annual General Meeting to be held in the year 2027. The requirement for seeking ratification of the members for continuation of their appointment has been withdrawn consequent upon the changes made by the Companies (Amendments) Act, 2017 with effect from May 7, 2018.

Hence the resolution seeking ratification of the members for their appointment is not being placed at the ensuing Annual General Meeting.

The Auditor Report on the Standalone

Financial Statements for the financial year ended March 31, 2024 does not contain any qualification, reservation or adverse remark requiring any explanations / comments by the Board of Directors.

The Secretarial Audit Report for the Financial Year ended March 31, 2024 is annexed herewith as Annexure- B.

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. Janak Pandya, Company Secretary in Practice (CP No.:

5940, ACS: 10841) (Peer Review Certificate

No. 1250/2021) to undertake the Secretarial Audit of the Company for the Financial Year ended March 31, 2025.

M/s Jayant & Associates, Chartered accountants (Firm Registration No. 104099W) under Section 138 of Companies Act, 2013 appointed as Internal Auditors for the Financial Year ended March 31, 2025 to perform the duties as Internal Auditors of the Company and their report is reviewed by the Audit Committee from time to time.

M/s. Sachin M Seth & Associates, Chartered Accountants (Firm Registration No: 141794W) appointed as Internal Auditors for NSE & BSE Regulatory Audit required for Stock brokers by SEBI for the Financial Year ended March 31, 2025 to perform the duties as Internal Auditors of the Company and their report is reviewed by the Audit Committee from time to time.

The Net Fixed Assets of the Company as at the close of the financial year stood at Rs. 9.81 lakhs

(Previous year Rs.11.15 Lakhs). In compliance with the Accounting Standard AS-28 relating to "Impairment of Assets", the Company has reviewed the carrying amount of its fixed assets as at the end of the financial year.

As per Regulation 15(2)(a) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended from time to time, the compliance with the Corporate Governance provisions shall not apply in respect of the listed entity having paid up equity share capital not exceeding Rs. 10 Crores and Net Worth not exceeding Rs.25 Crores as on the last day of the Previous Financial Year. Since the Companys Paid up Equity capital and the Net Worth fall below the limit mentioned above, compliance with Corporate Governance is not applicable to the Company. Accordingly, as per BSE clarification vide Circular LIST/COMP/12/2019-20 Companies to which the Regulation 15(2)(a) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are not applicable, Regulation 24A of SEBI (Listing Obligations and Disclosure

Requirements) (Amendments) Regulations, 2018 is also not applicable and not required to submit the Annual Secretarial Compliance Report as well as Disclosure of related party transaction on Consolidated basis under regulation 23(9) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

17. COMPLIANCE WITH SECRETARIAL

The Board of Directors affirm that the Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India (SS-1 & SS-2) respectively as amended relating to Meetings of the Board and its Committees which have mandatory application and General Meeting.

The information required pursuant to Section 197 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and the Companies (Particulars of Employees) Rules, 1975, in respect of employees of the Company and Directors is furnished hereunder: There were 17 permanent employees on the rolls of the Company as on 31 March, 2024.

The particulars of the conservation of energy, technology and absorption, foreign exchange earnings and outgo as required u/s. 134(3)(m) of the Companies Act, 2013 and Rule 8(3) of the Companies (Accounts) Rules, 2014, the same are not applicable to the Company. The information required pursuant to Section 197(12) read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, is not given as none of the employees of the company exceeds the limit.

98.43% of the Companys paid-up equity share capital is in dematerilised form as on 31st March, 2024 and balance 1.57% is in physical form. The Companys Registrar and Share Transfer Agents are M/s. Link Intime India Pvt. Ltd. having office at C-101, 247 Park, LBS Marg, Vikhroli – (W), Mumbai - 400083.

In line with the statutory requirements, the Company has transferred to the credit of the Investor Education and Protection Fund set up by the Government of India, equity shares in respect of which dividend had remained unpaid/ unclaimed for a period of seven (7) consecutive years within the time lines laid down by the Ministry of Corporate Affairs. Unpaid/ unclaimed dividend for seven (7) years or more has also been transferred to the IEPF pursuant to the requirements under the Act.

The Board of Directors take this opportunity to thank the employees for their dedicated service and contribution towards the growth of the Company, our sincere appreciation to Institutional and Retail Clients for their patronage to our Company and to the Shareholders for their continuous support.

The statements contained in the Boards Report contain certain statements relating to the future and therefore, are forward looking within the meaning of applicable securities, laws and regulations. Various factors such as economic conditions, changes in government regulations, tax regime, other statues, market forces and other associated and incidental factors may however lead to variation in actual results.