Simplex Realty Director Discussions


To

The Members,

Your Directors are pleased to present the Hundred and Tenth Annual Report, together with the Audited Accounts for the year ended 31 March, 2023.

FINANCIAL RESULTS ( in Lakhs)

Particulars

2022-2023 2021-2022

Total Income

767.90 878.88
Profit before Depreciation, Finance Costs, Exceptional Item and Taxation 190.39 339.59
Less: Depreciation 14.92 16.35
Less: Finance Costs 2.98 9.80

Profit before Exceptional Item and Tax

172.49 313.44
Less: Exceptional Item - -

Profit before Tax

172.49 313.44
Less: Current Tax 31.48 29.31
Deferred Tax 10.90 34.55
Taxes of earlier years 0.11 2.77

Profit for the year

130.00 246.81
Other Comprehensive Income/(Expense) for the year, net of tax (53.03) 18.14

Total Comprehensive Income/(Expense) for the year

76.97 264.95

DIVIDEND

The Directors are pleased to recommend a dividend of

1.00 per share (i.e 10%) on equity shares of face value of 10/- each for the year ended 31 March, 2023. The dividend, as recommended above, if approved by the Members at the ensuing Annual General Meeting, the total outflow towards dividend on equity shares for the year would be 29.91 Lakhs.

OPERATIONS

The total income of the Company for the current year is 767.90 Lakhs as against 878.88 Lakhs during the previous year. The Company has made a net profit of 130.00 Lakhs during the current year as against the net profit of 246.81 Lakhs in the previous year. The EPS for the current year is 4.35 as against 8.25 in the previous year after the exceptional item.

TRANSFER TO RESERVES

The Board of Directors of your Company have not transferred any amount to the reserves for the financial year under review.

ASSOCIATE AND JOINT VENTURE COMPANIES

The Company has two Associate companies viz. Simplex Papers Limited and Simplex Mills Company Limited. There are no joint venture companies within the meaning of Section 2(6) of the Companies Act, 2013 ("the Act").

During the year, the Board of Directors reviewed the affairs of the Associate Companies. In terms of subsection 3 of Section 129 of the Act, we have prepared consolidated financial statements of the Company, which forms part of the Annual Report. Further, a statement containing the salient features of the Financial Statements of the Associate Companies is set out in the prescribed form AOC-1 (Part ‘B Associates and Joint Ventures) which forms part of the Annual Report.

PROJECTS

The Companys project at Nachinolla, Goa having 4 villas is completed and ready for sale.

The Company has inventory (i.e. commercial units) in the project "Simplex KhushAangan" situated at S. V. Road, Malad (West), Mumbai and efforts are being made to sale the same.

The Company continues to focus on consolidation of its operations, rationalization of business and exploring the opportunities in the development and redevelopment projects.

CHANGE IN THE NATURE OF BUSINESS

There is no change in the nature of the business of the Company during the year.

PUBLIC DEPOSITS

The Company has not accepted any deposits from the public and as such, no amount of principal or interest on deposits was outstanding as on the balance sheet date.

LOANS, GUARANTEES AND INVESTMENTS

The details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Act are given in the notes to the Financial Statements.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with the provisions of Section 149 of the Companies Act, 2013, read with Regulation 17 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("SEBI Listing Regulations"), as amended from time to time, as on 31 March, 2023, the Board of Directors comprises of Eight Directors (with 3 Executive Directors and 4 Independent Directors and 1 Non-Executive Director).

Shri Nandan Damani (DIN:00058396) Chairman and Managing Director, retires by rotation in compliance with Section 152 of the Act, at the ensuing AGM of the Company and being eligible, offers himself for reappointment. The Board of Directors are also of the opinion that Shri Nandan Damani fulfills all the conditions as mentioned in the Act. Upon his reappointment as a Director, Shri Nandan Damani shall continue to hold his office of the Chairman and Managing Director, and shall not be deemed to constitute a break in his office.

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The Board of Directors at its Meeting held on 16 May, 2023, subject to approval of Members, approved the reappointment of Shri Nandan Damani (DIN:00058396) as the Managing Director, designated as the Chairman and Managing Director of the Company and Shri Sanjay N Damani (DIN:03078104), as the Whole-time Director, designated as the Executive Director of the Company, for a period of three years with effect from 29 June, 2023 and 1 June, 2023 respectively.

Pursuant to Regulation 36 of the SEBI Listing Regulations and Secretarial Standard-2 on General Meeting, a brief profile of the Directors proposed to be re-appointed is contained in the accompanying Notice of the AGM.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations and that they are not disqualified to become directors under the Companies Act, 2013. In terms of Section 150 of the Companies Act, 2013 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, Independent Directors of the Company have confirmed that they have registered themselves with the databank maintained by The Indian Institute of Corporate Affairs (‘IICA).

The Board of Directors is of the opinion that all the Independent Directors of the Company hold highest standards of integrity and possess requisite expertise and experience required to fulfill their duties as Independent Directors.

BOARD EVALUATION

The Board of Directors has carried out an annual evaluation of its own performance, Board Committee and Individual Directors. Pursuant to the provisions of the Act and the Listing Regulations, a structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Boards functioning composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance.

The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Directors. The Directors expressed their satisfaction with the evaluation process.

NUMBER OF MEETINGS OF THE BOARD

During the year under review, four Board meetings were held. The details of the meetings are given in Corporate Governance Report which forms part of this Report.

SHARE CAPTIAL

The paid-up equity share capital stood at 299.14 Lakhs. During the year under review, the Company has not issued equity shares with differential voting rights, sweat equity shares, employees stock options and not made any provision for purchase of its own shares.

REMUNERATION AND NOMINATION POLICY

The Board has framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The details of this policy is given in the Corporate Governance Report which forms part of this Report.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

The Company has practice of conducting familiarization programme for Independent Directors of the Company. The details of the said programme are given in the Corporate Governance Report which forms part of this Report.

PARTICULARS OF EMPLOYEES

During the 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. The prescribed particulars of Employees as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as Annexure III and forms part of this Report.

STATUTORY AUDITORS

In accordance with the provisions of Section 139 of the Act, Khandelwal and Mehta LLP, Chartered Accountants, Mumbai (ICAI Firm Registration No. W100084) will be completing their first term of five consecutive years on conclusion of the ensuing Annual General Meeting.

In view of the above, the Board of Directors at its Meeting held on 16 May, 2023, based on the recommendation of the Audit Committee, re-appointed Khandelwal & Mehta LLP, for a second term of five consecutive years commencing from the conclusion of the Hundred and Tenth Annual General Meeting till the conclusion of Hundred and Fifteenth Annual General Meeting to be held for the financial year 2027-28.

The Company has received their written consent along with the eligibility certificate confirming that they satisfy the criteria provided under Section 141 of the Act and that the appointment, if made, shall be in accordance with the applicable provisions of the Act and rules framed thereunder.

Accordingly, an Ordinary Resolution proposing the reappointment of Khandelwal & Mehta LLP, Chartered Accountants, Mumbai as the Statutory Auditors of the Company, is set out as an Item No. 4 in the accompanying AGM Notice forming part of the Annual Report.

The Auditors have submitted their Independent Auditors Report on the Financial Statements of the Company for the year ended 31 March, 2023 and they have given an unmodified opinion(s) report on the Financial Statements for the year under review. There were no qualifications, reservations or adverse remarks or disclaimer made by the Auditors in their report. No frauds have been reported by the Auditors under Section 143(12) of the Act.

SECRETARIAL AUDIT

The Board has appointed Taher Sapatwala & Associates, Practicing Company Secretaries to undertake the Secretarial Audit of the Company.

Accordingly, Secretarial Audit was conducted during the year, in accordance with provisions of Section 204 of the Act. The Secretarial Auditors Report is attached as Annexure II and forms an integral part of this Report. There is no secretarial audit qualification, reservation or adverse remark for the year under review.

REGISTRAR AND TRANSFER AGENT

During the year under review, the Company had initiated change of existing Share Transfer Agent (the STA) from "Freedom Registry Limited" to "Purva Shareregistry (India) Private Limited" having SEBI Registration number INR000001112 as Registrar and Transfer Agent (RTA). The applications submitted with National Securities Depository Limited and Central Depository Services (India) Limited have been duly approved and accordingly the effective date for change of RTA is 3 May, 2023.

SECRETARIAL STANDARDS

The Company has complied with the Secretarial Standards issued by the Institute of Company Secretaries of India on Board Meetings and Annual General Meeting.

CORPORATE GOVERNANCE

The Company has complied with the mandatory provisions of Corporate Governance requirements as stipulated under the Listing Regulations. A separate report on Corporate Governance along with the requisite Certificate is annexed and forms part of this Report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)c read with Section 134(5) of the Act and the Listing Regulations, on the basis of information placed before them, the Directors state that:

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. appropriate accounting policies have been selected and applied consistently, and the judgments and estimates that have been made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company

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as at 31 March, 2023 and of the profit of the Company for the said period;

iii. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. the internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

vi. there is a proper system to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

RELATED PARTY TRANSACTIONS

All Related Party Transactions that were entered into during the financial year were on an arms length basis, in the ordinary course of business and were in compliance with the applicable provisions of the Act and the Listing Regulations. There were no transactions during the year which would require to be reported in Form AOC-2. 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 at large during the year that would have required Members approval under the Listing Regulations.

The policy on Related Party Transactions as approved by the Board is available on the Companys website. None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company.

CORPORATE SOCIAL RESPONSIBILITY

As per the provisions of Section 135(1) of the Act, if the Company having Net worth of 500 crore or more or the turnover of 1,000 crore or more or Net Profit of 5 crore or more in immediately preceding financial year (i.e. as on 31 March, 2022 for the year under review) then the provision of this Section is applicable. In the case of our Company, none of these criteria is fulfilled as on 31 March, 2022.

Accordingly, the Company is not required to form Corporate Social Responsibility (CSR) Committee and to spend any amount towards the CSR activities for the financial year 2022-23 as per the provision of Section 135 of the Companies Act,2013.

However, with a view to have a better corporate governance, the Company continues with the CSR Committee which is already formed and conducts a meeting once in a year.

The details of Committee and its terms of reference are set out in Corporate Governance Report. The Annual Report on CSR activities is attached as Annexure I and forms part of this Report.

RISK MANAGEMENT

Risk management policy has been developed and implemented. The Board is kept informed of the risk mitigation measures being taken through risk mitigation report/operation report. There are no current risks which threaten the existence of the Company.

INTERNAL CONTROLS SYSTEMS AND ADEQUACY

The Company has in place an adequate system of internal controls. It has documented policies and procedures covering all financial and operating functions and processes. These have been designed to provide a reasonable assurance with regard to maintaining of proper accounting controls for ensuring reliability of financial reporting, monitoring of operations, protecting assets from unauthorized use or losses and compliance with regulations. The Company has appointed Vijay Rungta & Co., Chartered Accountants, Mumbai (ICAI Registration No. 111427W) as an Internal Auditors of the Company. Internal Financial Controls are evaluated and Internal Auditors Reports are regularly reviewed by the Audit Committee of the Board.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has a Vigil Mechanism / Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. The detail of the Policy is explained in the Corporate Governance Report and is also available on the Companys website on https://simplex-group.com/simplex_update/Realty_ Ltd/COMPANY%20CODE%20%20POLICIES/Whistle %20Blower%20Policy_SRL.pdf

ANNUAL RETURN

In terms of Section 92(3) of the Act, copy of the Annual Return of the Company is available on the website of the Company. The web link of the same is https://simplex-group.com/simplex_update/Realty_Ltd/ANNUAL%20 RETURN/SRL%20Form_MGT_7.pdf

STOCK EXCHANGE

The Companys equity shares are listed at BSE Limited and the Annual Listing Fees for the year 2023-24 has been paid.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE

During the financial year under review, no significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and the Companys operations in future.

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

Considering the Companys business activities, the Directors have nothing to report under Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014 with reference to Conservation of Energy and Technology Absorption.

Foreign Exchange

2022-23 2021-22

Transactions

Foreign Exchange Earnings NIL Nil
Foreign Exchange Outgo 11.79 0.42

DISCLOSURE UNDER THE PREVENTION OF SEXUAL HARRASSMENT ACT, 2013

The Company has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace and has duly constituted an Internal Complaints Committee in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder.

During the year under review, there was no complaint reported under the Prevention of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

MATERIAL CHANGES AFFECTING THE COMPANY

There were no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which these financial statements relate and the date of this Report.

DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016 (IBC) DURING THE YEAR ALONGWITH THEIR STATUS AS AT THE END OF THE FINANCIAL YEAR

Not applicable as the Company has not made or received any application under the IBC during the financial year.

DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF

The Company has not entered into any one time settlement and thus, this clause is not applicable.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report for the Financial Year under review as stipulated under Regulation 34 of the SEBI Listing Regulations is attached and forms part of this Report.

ACKNOWLEDGMENT

Your Directors place on record their appreciation for the assistance and support extended by all Government Authorities, Financial Institutions, Banks, Consultants, Solicitors and Members of the Company. The Directors express their appreciation for the dedicated and sincere services rendered by the employees of the Company.

For and on behalf of the Board of Directors

Nandan Damani Chairman and Managing Director DIN:00058396

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Mumbai, 16 May, 2023