Shree Securities Ltd Directors Report.

FOR THE FINANCIAL YEAR ENDED 31st DAY OF MARCH, 2019

To The Members,

The Directors submit 26th Annual Report of M/s. Shree Securities Limited (the "Company") along with standalone audited financial statements for the financial year ended on 31st March, 2019.

1. FINANCIAL RESULTS:

(Rs. In Lakh)

Particulars March 31, 2019 March 31, 2018
Sales and Other Income 310.46 304.69
Profit before depreciation, taxation & Exceptional items (21.30) (5.37)
Less: Depreciation 0.00 0.00
Less: Exceptional Items 0.00 0.00
Less: Current Tax 0.00 0.00
Less: Deferred Tax 0.00 0.00
Less: Tax for earlier year (0.06) 0.00
Profit after taxation (21.30) (5.37)
Add: Balance brought forward from previous year (59.57) (37.51)
Surplus available for appropriation (77.13) (59.57)
Appropriations
Transferred to Special Reserve 0.00 0.00
Contingency provision for Standard Assets 3.80 2.36
Provision for Doubtful Assets 0.00 (19.05)
Transitional Provision for Depreciation 0.00 0.00
Balance carried to Balance sheet (77.13) (59.57)

2. COMPANYS PERFORMANCE :

During the year under review, the revenue from operations is Rs. 310.46 lakhs compare to previous year Rs. 304.69 lakhs while the Company has earned Profit/(Loss) of Rs. (21.30) lakhs as against Loss of Rs.(5.37) lakhs of previous year. Your Directors are identifying prospective areas and will make appropriate investments that will maximize the revenue of the company in the current Financial Year.

2. BRIEF DESCRIPTION OF THE STATE OF COMPANYS AFFAIRS :

The Company is a Non-Banking Finance Company and is presently engaged in the business of Investing and Financing. In the multi-tier financial system of India, importance of NBFCs in the Indian financial system cannot be neglected. The Company expects that with a stable and a reformed government at the center, there will be positive growth and further rationalization of capital market, which will lead to more investment, value creation, capitalization and thus the additional wealth for investors and see better prospects in near future. Also, with the growing economy there will be more opportunities for financing which will prove beneficial for our company. The Company expects better results in near future in anticipation of the policy reforms combined with the dedication of the highly motivated team with excellent understanding of the operations along with magnificent customer relation skills.

3. DIVIDEND :

During the year under review, the Directors of your Company do not recommend any dividend.

4. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND :

Since there was no unpaid / unclaimed Dividend declared and paid in previous year, the provisions of Section 125 of the Companies Act, 2013 is not applicable to the Company.

5. AUDITORS :

Statutory Audit :-

The observation made in the Auditors Report read together with relevant notes thereon are self explanatory and hence, do not call for any further comments under Section 134 of the Companies Act, 2013. M/s. R. K. Kankaria & Co. Chartered Accountants, (Firm Registration No. 321093E), who are the Statutory Auditors of the Company, will hold office up to the Annual General Meeting of the Company in the year 2023. Secretarial Audit :-

As required under section 204 (1) of the Companies Act, 2013 the Company has obtained a secretarial audit report. 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 M/s. P D Rao & Associates, Practicing Company Secretaries (C.P. No. 14385 & Membership Number A38387) to undertake the Secretarial Audit of the Company. The Secretarial Audit report for the financial year ended 31st March, 2019 is annexed herewith as "Annexure-A" to this report. The Secretarial Audit Report does not contain any qualification, reservation and adverse remark.

6. AUDITORS CERTIFICATE ON CORPORATE GOVERANCE:

The auditors certificate on Corporate Governance as required by SEBI (LODR) Regulations, 2015 is enclosed to the Boards report. The certificate does not contains any qualifications, reservations or adverse remarks.

7. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

Pursuant to the provisions of section 149 of the Act, Mr. Harshwant Joshi (DIN : 03642328), Mr. Amit Kumar Basu (DIN: 08009413) and Mr. Sankar Kumar Chakraborty (DIN:00087412), Independent Directors of the Company, have submitted a declaration that each of them meets the criteria of independence as provided in section 149(6) of the Act and there has been no change in the circumstances which may affect their status as independent director during the year. Director Mr. Basant Kumar Sharma (DIN: 00084604) retire by rotation and, being eligible, offer himself for re-appointment. Mr. Basant Kumar Sharma (DIN: 00084604) has been re-appointed as Managing Director of the Company for the period of five years on expiry of his present term on 11.02.2019, with effect from 12th day of February, 2019 up to 10th day of February, 2024. Approval of members is being sought for appointment of Ms. Priya Sharma (DIN: 08350443) as Whole Time Executive Director cum CFO of the Company for a period of five years commencing 3rd February, 2019 to 2nd February, 2024 as set out in explanatory statement annexed to the notice convening this Meeting. During the year, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company. Pursuant to the provisions of section 203 of the Act, the key managerial personnel of the Company as on 31.03.2019 are - Mr. Basant Kumar Sharma (DIN 00084604), Chief Executive Officer cum Managing Director, Ms. Priya Sharma (DIN: 08350443), Chief Financial Officer cum Whole Time Director and Ms. Reema Kejriwal (ACS - 41217), Company Secretary.

8. COMMITTEES OF THE BOARD:

Currently, the Board has three committees: the Audit Committee, the Nomination and Remuneration Committee and the Stakeholders Relationship Committee. A detailed note on the composition of the Board and its Committees is provided in the Corporate Governance Report section of this Annual report.

9. CORPORATE SOCIAL RESPONSIBILITY:

According to the provision of Section 135 of the Companies Act 2013, companies having a net worth of Rs.500 crore or more, or turnover of Rs.1000 crore or more or a net profit of Rs.5 crore or more during any financial year are required to constitute CSR Committee. However, your Company does not fall in the above said criteria and hence not required to constitute the said Committee.

10. 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. The Board members were informed about risk assessment and after which the Board formally adopted and implemented the necessary steps for monitoring the risk management plan for the company.

11. STATUTORY INFORMATION:

Particulars as required under sub section (3)(m)of Section 134 of the Co. Act 2013 read with Companies (Accounts) Rules, 2014:

1. CONSERVATION OF ENERGY : Nil
2. TECHNOLOGY ABSORPTION & ADOPTION : Nil
3. FOREIGN EXCHANGE EARNING & OUTGO : Nil

12. DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to the requirement of clause (c) of sub-section (1) and sub section (5) of section 134 of the

Companies Act, 2013 (‘the Act) and based on the representations received from the operating management, the Directors hereby confirm that: i. In preparation of the annual accounts, the applicable Accounting Standards have been followed. ii. The Directors have selected such accounting policies and have 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 Profit & Loss of the company for that period. iii. The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities. iv. The Directors have prepared the annual accounts ongoing concern basis. v. The directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. vi. The directors had devised proper system to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively.

13. SUBSIDIARY COMPANIES:

The Company does not have any subsidiary, hence the compliance of provisions of section 129(3) of the Companies Act, 2013 are not applicable.

14. SHARE CAPITAL:

The paid up equity capital as on March 31, 2019 was Rs. 7,980 Lakhs. The company has not issued shares with differential voting rights nor granted stock options nor sweat equity.

15. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION

OF THE COMPANY OCCURRED BETWEEN THE ENDS OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT :

No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year and the date of this report.

16. TRANSFER TO RESERVES :

The company has transferred NIL amount to RBI Statutory Reserve Fund for the year ended 31st March 2019.

17. FINANCE:

The Cash and cash equivalents as at March 31, 2019 was Rs. 208.62 lakhs. The company continues to focus on judicious management of its working capital, Receivables and other working capital parameters were kept under strict check through continuous monitoring.

18. FIXED DEPOSITS:

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

19. PARTICULARS OF LOANS, ADVANCES, GURANTEES AND INVESTMENTS:

The provision of section 186 of the Co. Act, 2013 and Schedule V of the Securities and Exchange Board of

India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), are not applicable as the Company has not given any loans or guarantees during the year. The details of investments, if any, made by the Company is given in the notes of the financial statements.

20. 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 function is defined in the Internal Audit Manual. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board & to the Chairman & Managing Director. 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 at all locations of the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee of the Board.

21. ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS

COMMITTEES AND OF INDIVIDUAL DIRECTORS:

The board of directors has carried out an annual evaluation of its own performance, board committees and individual directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements),

Regulations 2015 ("SEBI Listing Regulations").

The performance of the board was evaluated by the board after seeking inputs from all the directors on the basis of the criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc. The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings, etc. The board and the nomination and remuneration committee reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the chairman was also evaluated on the key aspects of his role. In a separate meeting of independent directors, performance of non-independent directors, performance of the board as a whole and performance of the chairman was evaluated, taking into account the views of executive directors and non-executive directors. The same was discussed in the board meeting that followed the meeting of the independent directors, at which the performance of the board, its committees and individual directors was also discussed. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.

22. 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 Remuneration Policy is stated in the Corporate Governance Report.

23. PERSONNEL:

Human Capital is an important asset for the Company and the Company has taken and shall continue to take adequate steps towards education and enrichment of the human capital. Your Directors place on record the sense of appreciation for the valuable contribution made by the staff members of the company and hope that their continued support will help in achieving the goals of the Company. None of the employees of the company are in receipt of remuneration in excess of the limit prescribed under Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (appointment and Remuneration of Managerial Personnel) Rules 2014.

24. MEETINGS:

A calendar of Meetings is prepared and circulated in advance to the Directors. During the year 15 (Fifteen) Board Meetings and the details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

25. CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORT :

Pursuant to Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with the Stock Exchange and requirements under the Companies Act, 2013, the Report on Corporate Governance together with Statutory Auditors view and management discussion & analysis report regarding compliance of the SEBI code of Corporate Governance is annexed herewith.

26. TRANSACTIONS WITH RELATED PARTY:

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 with interest of the company at large. The policy regulates all transactions between the company and its related parties. The policy is available on the website of the company . (http://www.shreesecindia.com/file/2016/may/PolicyofRelatedPartyTransaction.pdf) .

27. ENVIRONMENT AND SAFETY :

The Company is conscious of the importance of environmentally clean & safe environment. Since your company is a Non-Banking financial company so the question of environment pollution does not arise. However, the company ensures safety of all concerned, compliances environmental regulations and prevention of natural resources.

28. POLICIES

We seek to promote and follow the highest level of ethical standards in all our business transactions guided by our value system. The SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 mandated the formulation of certain policies for all listed companies. All our corporate governance policies are available on our website (http://www.shreesecindia.com/invr.html). The policies are reviewed periodically by the board and updated based on need and new compliance requirement.

29. CODE OF CONDUCT:

The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the company. The Code has been posted on the Companys website.

The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders. The Code gives guidance through examples on the expected behavior from an employee in a given situation and the reporting structure. All the Board Members and the Senior Management personnel have confirmed compliance with the Code. All Management Staff were given appropriate training in this regard. The policy is available on the website of the Company (http://www.shreesecindia.com/file/ 2016/may/CodeofConductofBoardofDirectorsandSeniorManagementPerson.pdf) .

30. VIGIL MECHANISM / WHISTLE BLOWER POLICY :

The Company has a vigil mechanism named Fraud and Risk Management Policy to deal with instance of fraud and mismanagement, if any. In staying true to our values of Strength, Performance and Passion and in line with our vision of being one of the most respected companies in India, the Company is committed to the high standards of Corporate Governance and stakeholder responsibility. The Company has a Fraud Risk and Management Policy to deal with instances of fraud and mismanagement, if any. The FRM Policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination will be meted out to any person for a genuinely raised concern. A high level Committee has been constituted which looks into the complaints raised. The Committee reports to the Audit Committee and the Board. The policy is available on the website of the Company (http://www.shreesecindia.com/file/ 2016/may/WhistleBlowerPolicy.pdf) .

31. PREVENTION OF INSIDER TRADING:

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires pre-clearance for dealing in the Companys shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the Code. All Board Directors and the designated employees have confirmed compliance with the Code. The policy is available on the website of the Company (http://www.shreesecindia.com/file/2016/may/Insider Trading.pdf).

32. PRESERVATION OF DOCUMENTS:

All the documents as required under the Act, has been properly kept at the registered office of the Company.

33. LISTING WITH STOCK EXCHANGE

The Company confirms that it has not defaulted in paying the Annual Listing Fees for the financial year 2018-19 to The Bombay Stock Exchange Limited (BSE) and The Calcutta Stock Exchange Ltd. (CSE) where the shares of the Company are listed.

34. DEPOSITORY SYSTEM:

Your Companys equity shares are available for dematerialization through National Securities Depository Limited and Central Depository Services (India) Limited. As of March 31, 2019, 99.94% of the equity shares of your Company were held in demat form.

35. SECRETARIAL STANDARDS OF ICSI :

The Company is in compliance with the relevant provisions of Secretarial Standards on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) issued by the Institute of Company Secretaries of India and approved by the Central Government.

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

TRIBUNALS:

There are no significant and material orders passed by the regulators or courts or tribunals which impact the going concern status and Companys operations in future.

37. ARCHIVAL POLICY:

The policy deals with the retention and archival of corporate records of Shree Securities Ltd. The policy is available on the website of the company :

(http://www.shreesecindia.com/file /2016/July/ArchivalPolicy.pdf). 38. EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as

"Annexure B".

39. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE:

Your Company is committed to provide and promote safe, healthy and congenial atmosphere irrespective of gender, caste, creed or social class of the employees. No cases have been files under the Act as the Company is keeping the working environment healthy.

40. ACKNOWLEDGEMENTS:

The Board wishes to place on record their gratitude for the co-operation and assistance received from all those who contributed by some means or other for the performance of the company and expect the same in the future.

For and on behalf of the Board
Basant Kumar Sharma Priya Sharma
Managing Director cum CEO Chief Financial Officer
(DIN: 00084604) & Whole Time Director
Place : Kolkata (DIN: 08350443)
Date : 23rd day of May, 2019.