Odyssey Corporation Ltd Management Discussions.

(ANNEXURE IV)

Your Directors have pleasure in presenting the Management Discussion and Analysis report for the year ended on 31st March 2019.

INDUSTRY STRUCTURE AND DEVELOPMENT:

NBFCs are an integral part of the Countrys financial system complementing the Services of Commercial Banks. The main reason attributed to the growth of NBFCs is the comprehensive regulation of the banking system. Other factors include higher level of customer orientation, lesser pre/post sanction requirements and higher rates of interest on deposits being offered by NBFCs. It is mandatory that every NBFC should be registered with RBI to carry on any business of non-banking financial institution. The activities of Non-banking companies in India have undergone qualitative changes over the years through functional specialization. The role of NBFCs as effective financial intermediaries has been well recognized as they have inherent ability to take quicker decisions, assume greater risks, and customized their services and charges more according to the needs of the clients. While, this features as compared to the banks, have contributed to the proliferation of NBFCs , their flexible structures allow them to unbundle services provided by banks and market the components on a competitive basis. The differences between the banks and non-banks have been gradually getting blurred since both the segments of the financial system engage themselves in many similar types of activities. At present NBFCs in India have become prominent in a wide range of activities like hire purchase finance, equipment lease finance, loans, investments, etc. By employing innovative marketing strategies and devising tailor-made products, NBFCs have also been able to build up a clientele base among the depositors , mop up public savings and command large resources as reflected in the growth of their deposits from public, shareholders , directors and other companies , and borrowings by issue of non-convertible debentures, etc.

The importance of NBFCs in delivering credit to the unorganized sectors and small borrowers at the local levels in response to local requirements is well recognized. The rising importance of this segment calls for increased regulatory attention and focused supervisory scrutiny in the interests of the financial stability and depositor protection. The RBI and the Government had taken notable steps to address the economic headwinds. The Government formed the Project Management Group to facilitate large projects, undertake actions on power tariffs, gas price and continued diesel price increases. The RBI initiated efforts at recognizing and cleaning up Non-Performing Assets (NPAs). On the policy front it introduced a shift in focus of Consumer Price Inflation (CPI) from Wholesale Price Inflation (WPI), and a move towards Inflation targeting. If implemented correctly and in a time bound manner, these collectively have the ability to create a meaningful impact on the economy. Though the real economy volatility and its related pitfalls. The year ahead will be Challenging on the interest rate and credit quality front.

NBFCS AS COMPONENTS OF FINANCIAL SECTOR:

A broad picture of the role of NBFCs and their inter connectedness they have in the financial sector can be gauged from the details given below:

General:

The RBI circulated new norms for the sector, title "Revised Regulatory Framework for NBFCs" on November, 10 2014. These were aimed at strengthening the structural prolife of NBFCs and at the same time, safeguarding the interests of the depositors. An approved credit rating agency for the purpose of rating fixed deposits for NBFCs. Accordingly, NBFCs may also use the ratings for SMERA for the purpose of rating their Fixed Deposits.

Provisioning of doubtful assets -In July 2014, RBI released a circular outlining prudential norm on income recognition, asset classification and provisioning pertaining to advances. The rules related to minimum net owned funds were tightened and the deposit acceptance ratio, capital norms, asset classification rules and corporate governance norms were made more stringent.

This initiative will bring about parity in regulation for NMFCs registered with the RBI and other financial institutions, in matters relating to recovery. With respect to lending against shares, NBFCs are now required to maintain an LTV ratio of 50% and accept only Group 1 securities specified by SEBI) as collateral for loans with the values of more than 5 lakhs, subject to review. Further all NBFCs with asset sizes of 1,000 million and above are required to report on-line to stock exchanges, information on the shares pledged in their favour, by borrowers availing loans. The RBI has accredited SME Rating Agency of India Limited (SMERA).

An Overview of Regulation of NBFCs:

In response to the perceived need to better regulation for the NBFC sector, the Reserve Bank of India (RBI) Act, 1934 was amended in 1997, providing for a comprehensive regulatory framework for NBFCs. The RBI(Amendment) Act,1997 conferred powers on the RBI to issue directions to Companies and its Auditors, prohibit deposit acceptance and alienation of assets by companies and initiate action for winding up of Companies.

Mission:

To ensure that:

• The financial companies function on healthy lines.

• These companies function in consonance with the monetary policy framework, so that their Functioning does not lead to systematic aberration.

• The quality surveillance and supervision exercised by the RBI over the NBFCs keeps pace with the developments on this sector.

• Comprehensive regulation and supervision of Asset Liability and risk management system for NBFCs.

Amendments to the Reserve Bank of India (RBI) Act, 1934:

RBI Act was amended in January 1997 providing for, inter alia:

• Entry norms for NMFCs and prohibition of deposit acceptance (save to the extent permitted under the act) by unincorporated bodies engaged in Financial Business.

• Compulsory Registration, maintenance of liquid assets and creation of reserve fund.

• Power of the RBI to issue directions to NBFC or to the NBFCs in general or to a class of NBFCs.

• Comprehensive regulation and supervision of deposit taking NBFC and limited supervision over not accepting public deposits.

Basic structure of Regulatory and Supervisory Framework:

• Prescription of prudential norms akin to those applivable to the banks.

• Submission of periodical returns for the purpose of off-site surveillance.

• Supervisory framework comprising

a) on-site inspection (CAMELS pattern)

b) Off-site monitoring through returns.

c) Market intelligence, and

d) Exception reports by statutory auditors,

• Punitive actions like cancellation of Certificate of Registration (COR), prohibition from acceptance of cases, appointment of the RBI observers in certain cases, etc.

• Co-ordination with State Governments to curb unauthorized and fraudulent activities, training programmes for personnel of NBFCs, State governments and Police Officials.

Other steps for protection of depositors interest:

Publicity for depositors education and awareness, workshops/seminars for trade and industry organizations, depositors associations, chartered accountants, etc.

ABOUT ODYSSEY CORPORATION LIMITED:

Business Overview:

Our Company is a non-deposit taking NBFC, registered with the RBI. Our Company has been in the business of providing financial services since inception. Our Company is primarily focused in providing inter corporate loans, personal loans, loans against shares & securities, loans against properties, trade financing, bills discounting, trading in shares & securities, loans against stock and commodity market. Being an NBFC our Company has positioned itself between the organized banking sector and local money lenders, offering the customers competitive, flexible and timely lending services. Recently our Company offers financial services to commercial, industrial and financial clients with one stop financial solution.

FINANCIAL PERFORMANCE:

Consolidated Profit:

The Net Consolidated Profit of the Company for the FY 2018-19 comprises as Rs. (12, 56, 75,060)/-.

Standalone Profit:

During the fiscal 2019 the gross operational profit/loss of the Company stood at Rs. (12,55,95,884)/-

Financial Highlights:

PARTICULARS AMOUNT (RS.)
Income from Operations Rs. 16,29,56,572/-
Profit/Loss Before Tax Rs .(12,56,76,384) /-
Profit/Loss After Tax Rs. (12,55,95,884)/-
Basic Earnings per share (3.19)
Cash and Cash Equivalents Rs. 1,65,539/-
Face Value per Equity Share Rs. 5/-

SWOT ANALYSIS:

Strengths:

Ready contacts for business development: Our Company has strong relationships with the well-established business houses in India cultivated through several years of client servicing.

Promoted and Managed by qualified and experienced professionals: Our Company is promoted by Mr. Hiten R Mehta, who has more than 20 years of experience in financial services. The board of our Company comprises of qualified professionals, experienced in the industry.

Weakness:

Branding: Despite our ready contracts for business development and listing on esteemed Exchange (BSE) , our company is not a well-established brand among large NBFC players who have access to larger financial resources.

Accessibility: We do not have branches on a Pan India basis, so we are not able to explore the business opportunities in those regions.

Opportunities:

Large Market: The players in the NBFC sector still have a lot of scope to cover larger market and the rural markets are still untapped.

Desire for status: With increased desire of individuals to improve their standard of living , the NBFC industry is getting exposed to new category of Client (Individuals) in a big way with large share of business coming from this segment apart from corporate clients.

Threats:

Economic Downturn: If the Economic downturn is prolonged it can reduce the financing need of people duet shrinking business opportunities.

Private Banks: Private Banks are also working on the similar business model as the NBFCs do, thereby giving a very strong competition to the NBFCs.

RBI and Government Restrictions: With more stringent norms governing the functioning of NBFC and certain government restrictions act as a hindrance in smooth functioning of NBFC.

Changes in Policies towards NBFC: There is a growing trend towards more stringent yet structurally benificvail regulation in the NBFC Sector. Anticipating such regulations and implementing good governance norms before they are mandated has been a constant practice. Accordingly, the Company stands to benefit notifications.

FUTURE STRATEGY:

Expansion of existing activities:

Our Company intends to expand its financial services by enhancing its focus on margin funding, loan against shares and securities , loan against prosperities and corporate loan, bill discounting and working capital loan.

Financial Management/ Advisory Services:

We have an in house team which has the Capacity to provide the services in the area of financial management/ advisory services like syndication for big ticket loans from banks, project appraisals, debt restructuring and arranging non fund based limits from banks. Our Company is planning to foray into business of Financial Management/Advisory services with the potential clients.

Differentiated Services:

In the growing economy the corporate clients will require funds for further expansions. Our Company would be providing all diversified service portfolio under one umbrella to cater most of the Customer needs and demands.

Brand Recognition:

We are in such a business where we are facing lot of Competition. We are Planning to put more efforts to build Comfort as a well-known brand. Despite our existing contacts and listing on esteemed Exchange (BSE) our Company is not a well- established brand among large NBFC players . We will be making the necessary arrangements for our brand reorganization.

REGULATORY:

As Being A Non-Banking Finance Company is regulated by department od Non-banking supervision of Reserve Bank of India. Company is current under category of Non-Deposit taking Company so company is not within the purview of various guidelines applicable. However, RBI has issued several guidelines applicable to Non-deposit taking companies. Company is complying with various statutory provisions such as Companies Act, Income Tax, Service Tax, BSE Listing Agreement provisions and other applicable laws and regulations applicable to the Company. Notable among which are: -

• Submission of Financial Results

• Submission of Business Continuity Certificate

• Compliance with Prudential Norms

INTERNAL CONTROL SYSTEMS AND ADEQUACY:

Internal Control System has been designed to provide reasonable assurance that assets are safeguard, transactions are executed in accordance with managements authorization and properly recorded and accounting records are adequate for preparation of financial statements and other Financial Information. Internal Check is conducted on a periodical basis to ascertain the adequacy and effectiveness of internal control system.

CAUTIONARY:

Statement in the Management Discussion and Analysis, describing the Companys objectives, projections and estimates are forward looking statement and progressive within the meaning of applicable laws and regulations. Actual result may vary from those expressed or implied. Important developments that could affect the Companys Operations are significant changes in political and economic environment in India, tax laws, RBI Regulations, exchange rate fluctuations and other incidental factors.

SHOP NO 3, HEMU CASTLE, DADABHAI ROAD,

NEAR GOKHLIBAI SCHOOL,

VILE PARLE (WEST) MUMBAI 400056

By order of the Board

For Odyssey Corporation Limited

Sd/-

Hiten Ramniklal Mehta

Director

DIN: 01875252

CEO/ MANAGING DIRECTOR & CHIEF FINANCIAL OFFICER CERTIFICATION

To,

The Board of Directors

ODYSSEY CORPORATION LIMITED

Subject: Certificate in accordance with Regulation 33(2) (a) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015:

We, undersigned certify that the Audited Financial Results for the quarter and year ended 31stMarch, 2019 prepared in accordance with Clause 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 do not contain any false or misleading statement or figures and do not omit any material fact which may make the statements or figures contained therein misleading and we further certify that;

• We have reviewed financial statements and the cash flow statement for the quarter and year ended March 31, 2019 and that to the best of their knowledge and belief:

• these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;

• These statements together present a true and fair view of the listed entitys affairs and are in compliance with existing accounting standards, applicable laws and regulations.

• There are, to the best of our knowledge and belief, no transactions entered into by the listed entity during the year which are fraudulent, illegal or violative of the listed entitys code of conduct.

• We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have evaluated the effectiveness of internal control systems of the listed entity pertaining to financial reporting and we have disclosed to the auditors and the audit committee, deficiencies in the design or operation of such internal controls, if any, of which we are aware and the steps we have taken or propose to take to rectify these deficiencies.

• We have indicated to the auditors and the Audit committee:

• significant changes in internal control over financial reporting during theyear;

• significant changes in accounting policies during the year and that the same have been disclosed in the notes to the financial statements; and

• Instances of significant fraud of which they have become aware and the involvement therein, if any, of the management or an employee having a significant role in the listed entitys internal control system over financial reporting.

SD/- SD/-
(HITEN MEHTA)
MANAGING DIRECTOR CHIEF FINANCIAL OFFICER
DIN: 01875252 MS. USHA TULSIDAS ABHADE
Date30th May, 2019
Place: Mumbai