DIRECTORS' REPORT To, The Members, The Directors submit 29th Annual Report of Shree Global Tradefin Limited (the "Company" or "SGTL") along with the Audited Financial Statements for the financial year ended March 31, 2015. OPERATIONS & OVERALL PERFORMANCE The Company has achieved a net profit of Rs. 40.72 Lacs for the year under review as against Rs. 75.39 Lacs in the last year. The total income of the Company is Rs. 29379.86 Lacs as against Rs. 254.13 Lacs during the last year. MANAGEMENT DISCUSSION AND ANALYSIS The core business of the Company is trading in Iron and Steel products and Investment in Securities. In terms of Clause 49 of Listing Agreement, the Management discussions and analysis is given hereunder:- a) Industry structure and development: Company is engaged in trading activity primarily having vast potential & now being getting attention of the organised sector. b) Opportunities and threats: Sustained economic growth in the country may affect the business of the Company and sector overall. However, the Company is taking proper steps to mitigate the business risk. c) Segment-wise performance: The Company is operating on only one broad segment and hence separate segmental reporting is not applicable. The Company has no activity outside India. d) Outlook: The outlook for 2015-2016 has to be viewed in the context of overall economic scenario etc. e) Risk and concerns: The Company is exposed to general market risk and is initiating adequate step to mitigate it. f) Internal control system: The Company maintains adequate internal control systems, which provides adequate safeguards and proper monitoring of the transactions. g) Discussion on financial performance with respect to operating performance: The operating performance of the Company has been discussed in Directors Report under the head 'Financial Highlights and Operations and Overall Performance' in the current year. h) Human resources and industrial relations: During the year under review the Employee/Industrial relations remained cordial. i) Cautionary Statement: The Management Discussions and Analysis describe Company's projections, expectations or predictions and are forward looking statements' within the meaning of applicable laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Company's operations include economic conditions affecting demand and supply and price conditions in domestic and international market, changes in Government regulations, tax regimes, economic developments and other related and incidental factors. INVESTOR SERVICES The Company and its Registrar, M/s. Bigshare Services Private Limited who is looking after the physical as well as Demat work and also shareholders correspondences in terms of SEBI's directions, endeavoured their best to service the Investors satisfactorily. DIVIDEND The directors have not recommended any dividend for the year ended 31st March, 2015 to conserve the resources in long run. TRANSFER TO RESERVES The Company did not propose to transfer any amount to any reserves. SUBSIDIARY & CONSOLIDATED FINANCIAL STATEMENTS The Company is not required to consolidate it's Financial Statements for the year ended 31st March, 2015 as Company do not have any subsidiary. CHANGE IN THE NATURE OF BUSINESS During the year under review, there are no changes in the nature of the business of the company. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY There have been 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 the financial statements relate and the date of this report. INTERNAL FINANCIAL CONTROL SYSTEM The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to Section 134(3)(c) of the Companies Act, 2013, the Directors, based on the representations received, confirm that - 1. In the preparation of the annual accounts for the Financial Year 2014-15, the applicable Accounting Standards have been followed and that there are no material departures from the same; 2. They have, in the selection of the Accounting Policies, consulted the Statutory Auditors and have applied them consistently and made judgements 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 of the profit of the Company for that period; 3. They have taken proper and sufficient care to the best of their knowledge and ability 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; 4. They have prepared the annual accounts on a going concern basis. 5. They have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively. 6. They have devised proper systems to ensure compliances with the provision of all applicable laws and that such systems are adequate and operating effectively. DIRECTORS AND KEY MANAGERIAL PERSONNEL APPOINTMENT 1. Mr. Rajesh Gupta (DIN 00028379) Mr. Rajesh Gupta who was holding the position of the Chairman and WTD of the company since 1st May, 2014, was appointed as Chairman and Managing director w.e.f 14th January, 2015, for a period of three years. 2. Mr. Shashi Nair (DIN 00056445) Mr. Shashi Nair stepped down as the Executive Manager of the company due to his preoccupancy with other assignments and he was redesignated as the Non executive independent director of the company with effect from 1st April, 2014. INDEPENDENT DIRECTORS In accordance with the provisions of section 149 of the Companies Act, 2013 & revised clause 49 of the listing agreement, the Board of Directors appointed Mr. N. K. Mohan (DIN 02542406), Mr. Ravindra Anant Deshpande (DIN 01003990) & Mrs. Uniza Shaikh (DIN 06975961) as the Independent directors of the company for the fixed term of five years starting from 14th January, 2015. Subsequently the shareholders approved their appointment by giving their consent through postal ballot, the result of which was declared on 14th January, 2015. The profile of Independent directors forms part of the Corporate Governance Report. KEY MANAGERIAL PERSONNEL 1. Mr. Jaikishan Sarda Pursuant to section 203 of the Companies Act, 2013 the Board appointed Mr. Jaikishan Sarda as the Chief Financial officer of the company w.e.f 9th August, 2014. He has a vast experience of more than 41 years in the field of finance and accounts. He has been associated with the Company since 1990, looking after the entire accounts and financial functions of the company. 2. Mr. Jitendra K. Sharma The Board appointed Mr. Jitendra K. Sharma as the company secretary of the company w.e.f 1st January, 2015, to fill in the vacancy caused by the resignation of Mrs. R.Rajalakshmi. CESSATION/RESIGNATION 1. Mr. Shashi Nair (DIN 00056445) resigned as a director of the company w.e.f 14th October, 2014. The Board places on record its sincere appreciation for his valuable guidance & contribution to the company. 2. Mr. Y. S. Vasudevan (DIN 02278644) resigned as a director of the company w.e.f 30th November, 2014. The Board places on record its sincere appreciation for his valuable guidance & contribution to the company. 3. Mrs. R.Rajalakshmi resigned as the company secretary of the company w.e.f 30th November, 2014. The Board places on record its sincere appreciation for her valuable guidance & contribution to the company. RETIREMENT BY ROTATION In accordance with the provisions of Section 152(6) of the Companies Act, 2013, Mr. Rajesh Gupta (DIN 00028379) will retire by rotation at the ensuing Annual General Meeting of the company and being eligible, offers himself for re-appointment. The Board recommends his re-appointment. DECLARATION BY INDEPENDENT DIRECTORS The Independent Directors have submitted the Declaration of Independence, as required pursuant to section 149(7) of the Companies Act, 2013 and revised clause 49 of the listing agreement, stating that they meet the criteria of independence as provided in section 149(6) of the Companies Act, 2013. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES The Company does not have any employee, whose particulars are required to be given pursuant to the provisions of Rule 5(2) & (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 Disclosures pertaining to remuneration and other details as required 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 are annexed hereto marked as Annexure "B" and forms part of this report. DEPOSITS The Company has not accepted any Deposits covered under Chapter V of Companies Act, 2013, from the members or the general Public during the year under review and as such no amount on account of principal or interest on the deposits was outstanding as on the date of the Balance sheet. SHARE CAPITAL 1. Offer for Sale During the year under review, the Board passed the resolution at the meeting held on 10.05.2014 to consider and approve Offer for Sale (OFS). The Company received the letters from the promoter group on 29.04.2014 with respect to Offer for Sale (OFS). Mrs. Abha M. Gupta, Mrs. Chitralekha R. Gupta and Mrs. Renu R. Gupta belonging to the Promoter and Promoter group entity of the Company made an Offer for Sale (OFS) of their collective share holding aggregating to 1,37,81,523 (6.59%) equity shares ('Shares') of the face value of Rs.5/- each, through the Stock Exchange mechanism in accordance with SEBI circular no. CIR/MRD/DP/18/2012 dated July 18, 2012 and further amendments vide circular no. CIR/MRD/ DP/04/2013 dated January 25, 2013 and SEBI Circular no. CIR/MRD/DP/17/2013 dated May 30, 2013 and also in compliance with SEBI letter No. CFD/DILVSK/SGS/ OW/8870/2014 dated March 24, 2014. Rs. 30/- (Rupees Thirty Only) per equity shares was the Floor Price of the Company. 2. Preferential allotment During the year under review, the company allotted 1,90,00,000 [One Crore Ninety Lacs] Convertible Warrants to M/s. Pragya Realty Developers Private Limited (Non Promoter) on preferential basis at a Subscription Price of Rs. 9/- per warrant, thereby entitling the holder of the warrants to exercise an option to subscribe to 1,90,00,000 Equity Shares of the Company (having a face value of Rs. 5/- each) at an exercise price of Rs. 27/- per share (Effective price being Rs. 36/- per equity share i.e. at a premium of Rs. 31/- per equity share). These convertible warrants as on March 31st, 2015 represent the 1,90,00,000 equity shares of Rs. 5/- each which have been duly converted into equity shares pursuant to exercise of option by the M/s. Pragya Realty Developers Private Limited. ADOPTION OF NEW SET OF ARTICLES OF ASSOCIATION With the coming into force of the Companies Act, 2013 several articles of the Articles of Association of the Company required alteration / deletions. The Companies Act, 2013 also states that the Articles of Association of the company shall be in the specified format applicable to the respective company. Given this position, it was necessary to wholly replace the existing Articles of Association by a new set of Articles. Thus the Company has adopted and approved the new set of articles incorporating the provisions of Companies Act, 2013, in place of existing Articles of Association of the company through postal ballot and result of the same was declared on 14th January, 2015. PERFORMANCE EVALUATION POLICY The Nomination and Remuneration Committee has laid down the criteria for performance evaluation of the individual Directors and the Board. The framework of performance evaluation of the Independent Directors captures the following points: A. Key attributes of the Independent Directors that justify his/ her extension/continuation on the Board of the Company; B. Participation of the Directors in the Board proceedings and his/ her effectiveness; The evaluation was carried out by means of the replies given/ observations made by all the Directors on the set of questions developed by them which brought out the key attributes of the Directors, quality of interactions among them and its effectiveness. The Performance Evaluation Policy as approved by the Board is uploaded on the company's website at the web link: <http://www.sgtl.in/policies.html> CONTRACTS AND ARRANGEMENTS WITH RELATED PARTY All the Transactions entered with Related Parties for the year under review are strictly done on arm's length basis and in the ordinary course of business. The Company presents full details of transactions of all related party before the Audit Committee, specifying the nature, value and terms & conditions of the transactions. Transactions with related parties are conducted in a transparent manner with the interest of the Company and Stakeholders as utmost priority. The company has not entered into any materially significant related party transactions. Particulars of Related Party Transactions made pursuant to Section 188 of the Companies Act, 2013 are provided in Note 24 to the Financial Statement. The Company, by passing a Special Resolution through Postal Ballot on 14th January, 2015, has received consent from the members of the Company to enter into the contracts, agreements with related parties as defined under the Act. The Related Party Transactions policy as approved by the Board is uploaded on the company's website at the web link: <http://www.sgtl.in/policies.html> CORPORATE GOVERNANCE Pursuant to the revised Clause 49 of the Listing Agreement, your Company has taken adequate steps to ensure that all mandatory provisions of Corporate Governance as prescribed under the Listing Agreement of the Stock Exchange with which the Company is listed are complied with. The report on Corporate Governance as stipulated under the Listing Agreement forms an integral part of this Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance is attached to the report on Corporate Governance.-As Per Annexure 'D'. POLICIES AND COMMITTEES AUDIT COMMITTEE The Audit Committee of the company was reconstituted on 27th September, 2014 in terms of Companies Act, 2013 and revised clause 49 of the Listing Agreement. The Committee comprises of Mr. Ravindra Anant Deshpande as the Chairman, and Mr. N.K.Mohan and Mrs. Uniza Shaikh as the Members. All the recommendations made by the Audit Committee are accepted and implemented by the Board of Directors. More details on the committee are given in the Corporate Governance Report. NOMINATION AND REMUNERATION COMMITTEE The Remuneration Committee of the company was reconstituted and renamed as "Nomination and Remuneration Committee" on 27th September, 2014 in terms of Companies Act, 2013 and revised clause 49 of the Listing Agreement. The Committee comprises of Mr. N.K.Mohan as the Chairman, and Mrs. Uniza Shaikh and Mr. Ravindra Anant Deshpande as the members. More details on the committee are given in the Corporate Governance Report. STAKEHOLDERS RELATIONSHIP COMMITTEE The Stakeholders Relationship Committee of the company was constituted on 27th September, 2014 in terms of Companies Act, 2013 and revised clause 49 of the Listing Agreement. The Committee comprises of Mr. N.K.Mohan as the Chairman, and Mrs. Uniza Shaikh and Mr. Ravindra Anant Deshpande as the members. More details on the committee are given in the Corporate Governance Report. RISK MANAGEMENT COMMITTEE The Risk Management Committee of the company was constituted on 8th November, 2014 in terms of revised clause 49 of the listing agreement. The Committee comprises of Mr. Rajesh Gupta as the Chairman, and Mr. N.K.Mohan, Mrs. Uniza Shaikh and Mr. Ravindra Anant Deshpande as the members. More details on the committee are given in the Corporate Governance Report. CSR POLICY (CORPORATE SOCIAL RESPONSIBILITY POLICY) Corporate Social Responsibility Policy is not applicable to the Company. Hence no CSR Committee is formed. REMUNERATION POLICY The Nomination and Remuneration Committee has formulated and implemented "Remuneration policy" in compliance with section 178 of the companies act, 2013 read with applicable rules thereto and revised clause 49 of the Listing Agreement. The policy provides guidelines to the Nomination & Remuneration Committee relating to the Appointment, Removal & Remuneration of Directors and KMP. It also provides criteria for determining qualifications, positive attributes and independence of a director. The Remuneration policy as approved by the Board is uploaded on the company's website at the web link: <http://> www.sgtl.in/policies.html RISK MANAGEMENT POLICY The Risk Management policy is formulated and implemented by the company in compliance with the provisions of the new Companies Act, 2013 and revised Listing Agreement. The policy helps to identify the various elements of risks faced by the company, which in the opinion of the Board threatens the existence of the Company. The Risk Management Policy as approved by the Board is uploaded on the company's website at the web link: <http://> www.sgtl.in/policies.html WHISTLE BLOWER POLICY & VIGIL MECHANISM Pursuant to Section 177 (9) of the Companies Act, 2013 and revised clause 49 of the Listing Agreement, the Company has formulated Whistle Blower Policy & established Vigil Mechanism for the directors and employees of the Company to report, serious and genuine unethical behaviour, actual or suspected fraud and violation of the Company's code of conduct or ethics policy. It also provides adequate safeguards against victimization of persons, who use such mechanism and makes provision for direct access to the chairperson of the Audit Committee in appropriate or exceptional cases. None of the employees of the Company has been denied access to the Audit Committee. Mr. Rajesh Gupta, Chairman and Managing Director of the company, has been designated as Vigilance and Ethics Officer for various matters related to Vigil Mechanism. The Whistle Blower Policy & Policy on Vigil Mechanism as approved by the Board is uploaded on the company's website at the web link: <http://www.sgtl.in/policies.html> SECRETARIAL AUDITOR AND SECRETARIAL AUDIT REPORT The Board has appointed Mr. K. C Nevatia of K. C. Nevatia & Associates, a firm of Company Secretaries in Practice, to carry out Secretarial Audit under the provisions of section 204 of the Companies Act, 2013 for the financial year 2014-15. The Report of the Secretarial Auditor is annexed to this report as "Annexure C". The report states that the provisions of section 152(6)(a) and 152(6)(c) were not complied. As regards non compliance with the provisions of section 152(6)(a) and 152(6)(c) of Companies Act, 2013 as specified in the Secretarial Audit report, the Board would like to state that the company is in process to comply with the provisions of section 152(6)(a) and 152(6)(c) of Companies Act, 2013. AUDITORS Pursuant to Section 139 of the Companies Act, 2013, Rules made thereunder and subject to approval of the members of the company at the Annual General Meeting, the Board of Directors on the recommendation of the Audit Committee appointed M/s Ashok S. Jain & Co. Chartered Accountants (Firm Registration No. 111791W), as the Statutory Auditors of the company for the period of three financial years commencing from 1st April, 2014 to 31st March, 2017. The Board based on the recommendation of the Audit Committee, recommends the ratification of the appointment of M/s Ashok S. Jain & Co. Chartered Accountants (Firm Registration No. 111791W), as the statutory auditors. The members are thus requested to ratify the appointment of aforesaid statutory Auditors for the next financial year 2015-2016 at the ensuing Annual General Meeting. AUDITORS REPORT There are no qualifications, reservations, or adverse remarks made by the statutory auditors in their report. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013. Your Directors state that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. ANNUAL RETURN The Extract of the Annual Return (Form MGT-9) for the Financial Year 2014-15 is enclosed with this report pursuant to section 92 (3) of the Companies Act, 2013 as a "Annexure A". PAYMENT OF ANNUAL LISTING FEES Shares of the company are presently listed at BSE Ltd (Bombay Stock Exchange Limited), P.J.Towers, Dalal Street, Mumbai and the Company has paid listing fee upto March 31st, 2016 in respect of above to the stock exchange. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO. Information in accordance with provisions of section 134(3)(m) of the Companies Act, 2013, read with Rule 8 of Companies (Account) Rules, 2014 is not required since the Company is not a manufacturing Company. ACKNOWLEDGEMENT: Your Directors place on record their sincere appreciation and gratitude for the assistance and generous support extended by all Government authorities, Financial Institutions, Banks, Customers and Vendors during the year under review. Your Directors wish to express their immense appreciation for the devotion, commitment and contribution shown by the employees of the company while discharging their duties. For and on behalf of the Board Rajesh Gupta Chairman Dated: 27/05/2015 Place: Mumbai |