DIRECTOR S’ REPORT TO THE MEMBERS Your Directors have great pleasure in presenting the TWENTY FIFTH Annual Report together with the Audited Accounts of your Company for the Financial Year ended 31.03.2016. Members would be happy to note that your company has had a successful year of operation, which resulted in an after tax profit of Rs.644.61 Lakhs. THE STATE OF THE COMPANY’S AFFAIRS : During the year 2015-16, there was no significant change in the Business model of the company. DIVIDEND Your Directors are pleased to record the completion of 25 years of operations of the company and to commemorate the occasion, recommend an exclusive one time dividend of 3% in addition to the dividend of 14%. Thus, your Directors hereby recommend an overall Dividend of 17% on the Equity Share Capital of the Company for the year ended March 31, 2016. The dividend, if approved by the Shareholders will be paid out of the profits of the Company for the year to all those equity shareholders whose names appear in the Register of Members of the Company as on 08th June 2016, being the record date. TRANSFER TO RESERVE The Board after apportioning the appropriate amounts to Dividend, approved the transfer of Rs.200 lakhs to General Reserves. FUTURE PROSPECTS Your Company currently enjoys 100% occupancy level. There is no proposal for any further expansion at this moment. SUBSIDIARY COMPANY The statement pursuant to Sec 129 of the Companies Act, 2013, containing the relevant details of the Company’s subsidiary is attached. As the Company is yet to commence its operations, performance report of this subsidiary is not applicable. COST AUDITOR Pursuant to Section 148 of the Companies Act, 2013 and the Cost Audit Rules 2014 thereof, our company does not fall within the threshold limit prescribed for Cost Auditing CORPORATE GOVERNANCE Your Company follows the principles of effective Corporate Governance Practices. The Company has taken steps to comply with Corporate Governance as per the applicable regulations of SEBI (Listing Obligations And Disclosure Requirements) Regulations,2015. This Report is available under the heading “Report on Corporate Governance” and forms part of this Annual Report. The Management Discussion and Analysis Report also form part of this Annual Report. Also a Report on Annual returns Extracts in MGT-9, Declaration from Independent Directors on Annual basis and AOC-2 Related party Transactions Disclosures are being annexed as part of this Annual Report. LISTING OF SHARES Your Company’s share is listed presently in BSE Limited. DEMATERIALISATION OF EQUITY SHARES As on 31.03.2016, 37,53,635 numbers of equity shares are held in Dematerialized Form, which constitutes 93.84% of total shareholding. ACCEPTANCE OF FIXED DEPOSITS The company has not invited and accepted Fixed Deposits from the public during the Financial year. DIRECTORS Under the provisions of the Articles of Association of the Company, one of your Director Thiru J.Ravi, retires by rotation at the forth coming Annual General Meeting and being eligible, offers himself for reappointment. DIRECTORS’ RESPONSIBILITY STATEMENT Pursuant to Sec. 134 clause (c) of sub-section (3) of the Companies Act, 2013, the Directors confirm: (a) that in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; (b) that the directors had selected such accounting policies and 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 of the profit and loss of the company for that period; (c) that the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities (d) that the directors have prepared the annual accounts on a going concern basis; and (e) that the directors, in the case of a listed company, have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. (f) that the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. None of the non-executive directors holds any share/convertible instruments in the company CORPORATE SOCIAL RESPONSIBILITY INITIATIVES As part of its initiatives under “Corporate Social Responsibility” (CSR), the company has contributed funds of Rs. 2,50,000/- and Rs.14,26,000/- towards Rural Development Organization (R.D.O Trust) and Cancer Institute, Adyar, Chennai, respectively. The Annual Report on CSR activities is annexed herewith as: Annexure III. AUDITORS M/s S.H. Bhandari & Co. Chartered Accountants, Chennai, the Statutory Auditors of the Company retire at the conclusion of this Annual General Meeting and have expressed their willingness to continue as auditors of the company for the financial year 2016-17. Necessary special resolution has been proposed for appointing them as auditors pursuant to Sec 139 of the Companies Act, 2013. There is no qualification, reservation or adverse remark or disclaimer made by the Auditor. INDUSTRIAL RELATIONS Industrial relations, during the period under review, continued to remain cordial. PARTICULARS OF EMPLOYEES None of the employees of the Company were in receipt of remuneration, which in the aggregate exceeded the limits fixed under Section 134 of the Companies Act, 2013.. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO As the company is not an industrial undertaking, particulars with regard to conservation of energy and technology absorption required to be given under these heads in accordance with the provisions of Section 134 of the Companies Act, 2013, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are not applicable. EARNINGS IN FOREIGN EXCHANGE: NIL EXPENSES INCURRED IN FOREIGN CURRENCY DURING THE YEAR: NIL BRIEF DESCRIPTION OF THE COMPANY’S WORKING DURING THE YEAR/STATE OF COMPANY’S AFFAIR The Company has its operations in one location, and there is no significant change in the business model. SHARE CAPITAL During the year under review, your Company has not issued any type of Share capital. FORMAL ANNUAL EVALUATION The Company being IT Infra Structure provider and established in the year 1990 continued to operate on profitable basis year by year. Since, during the year, the IT industry had a moderate growth, the profits of the company is also on desired level. VIGIL MECHANISM (Whistle Blower Policy) As per Section 177 of the Companies Act, 2013, your company has a well-established vigil policy. SECRETARIAL AUDIT REPORT A Secretarial Audit Report given by M/s, B.P Associates, Practicing Company Secretaries is being annexed in MR 3 Form. There is no qualification, reservation or adverse remark or disclaimer made by the Company Secretary in Practice in the Secretarial Audit Report. PARTICULARS OF LOANS, INVESTMENT OR GUARANTEES During the year under review, your Company has not provided any loans or Guarantees. The company has invested in “AXIS HYBRID FUND SERIES 27” which is a close ended mutual fund for a value of Rs.4.00 crores, which is well within the threshold limits as per the provisions of the Section 186 of the Companies Act, 2013. RISK MANAGEMENT POLICY Risk Management Policy has been discussed under the head “CORPORATE GOVERNANCE REPORT” which is annexed to this. Disclosure as required under Section 22 of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 During the financial year under review, the Company has not received any complaints of sexual harassment from any of the women employees of the Company. MATERIAL CHANGES During the year under review, your Company does not have any material changes in its financial position. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES All transactions entered into with related parties were in the ordinary course of business. There were no material related party transactions i.e transactions entered into during the year. Accordingly, there are no transactions that are required to be reported in Form AOC 2. None of the Directors nor the Key Managerial Personnel have any pecuniary relationships or transactions vis-à-vis the Company. The policy on Related Party Transactions as approved can be accessed through weblink http: // www.elnettechnologies.com/ Document / Related%20 Party%20Transaction%20policy.pdf CONSOLIDATED FINANCIAL STATEMENTS As stipulated by Regulation 33 of the SEBI (LODR), Regulations 2015, the consolidated financial statements have been prepared by the Company in accordance with the applicable Accounting Standards. The audited consolidated financial statements together with Auditors’ Report form part of the Annual Report. The Company has opted to publish the consolidated financial only for the financial year ended 31st March and for the quarter ended financials, only the standalone financials have been published. Significant & Material Orders passed by the Regulators or Courts There have been no significant and material orders passed by the courts or regulators or tribunals impacting the going concern status and Company’s operations. However, members’ attention is drawn to the statement on contingent liabilities and commitments in the notes forming part of the Financial Statements. ACKNOWLEDGEMENT Your Directors wish to express their sincere thanks to the Government of Tamil Nadu, Electronics Corporation of Tamil Nadu Ltd., State Bank of India, Industrial Finance Branch, Chennai, Canara Bank, Tidel Park Branch, Axis Bank, Thiruvanmiyur Branch and the Company’s customers for their support and co-operation extended during the year. Your Directors also wish to place on record their appreciation for the good work put in by the employees of your Company. For and on behalf of the Board of Directors, Tmt. Unnamalai Thiagarajan MANAGING DIRECTOR DIN : 00203154 Thiru P.Manivannan DIRECTOR DIN : 07323312 Date : 06.05.2015 Place : Chennai |