DIRECTORS' REPORT & STATE OF AFFAIRS REPORT To the Members, Libord SecuritiesLimited Your Directors have pleasure in presenting the 21st Annual Report along with the Audited Accounts of the Company for the year ended 31st March, 2015. 1. REVIEW OF OPERATIONS The income from operation on during the year was Rs.35.49 Lakhs (Previous Year 60.84 Lakhs). The company's turnover has decreased by about 41.67% on largely due to less favourable performance in the 4th quarter of this financial year on account of difficult business conditions. The profits have decreased by 51.52% due to low level of operations. 2. OUTLOOK & PROSPECTS This fiscal, the Global growth has remained moderate, with uneven prospects across the main countries and regions. According to World Economic Outlook (Update-April, 2015) the global economy is projected to grow at 3.5 percent in 2015. Although there have been signs of improvement in the growth rates in some of the advanced economies but the uncertainties largely loomed over the financial and capital markets due to the Eurozone crisis and possibility of fed interest rate hike. There has been a slower growth in emerging market and developing economies and concerns were raised in particular, about slow down in the Chinese Economy. In India, although the economy has registered a growth rate of about 7.3% in 2014-2015 but it is largely not reflected in some of the major indicators of growth giving rise to perceptions that probably a hike in the projected rate of growth might partially be attributable to changes in the method of computation brought about this year. For instance the Bank credit growth dropped to a 18-year low while deposit growth fell to a 19-year low in 2014-15 with fresh investment proposals from corporates drying up completely and projects announced in the past remaining stuck because of several issues. Credit growth would have been substantially lower had it not been for the smart pick-up in personal loans. Also this fiscal a large number of corporate have showed up weak balance sheets, with an upsurge in gross as well as net NPAs creating stress upon the banking system, slow rate of growth in industrial production and massive fall in exports from India. Also, there have been dramatic declines in savings and investment ratios. The gross fixed capital formation declined from 33.6 percent in 2011-12 to 29.7 percent in 2013-14 while gross domestic savings declined from 33.9 percent to 30.6 percent. As per the Economic Survey 2015, "...The data show that private corporate investment increased robustly in 2013-14 which seems at odds with stressed balance sheets and the phenomenon of stalled projects" However, the Indian economy has shown greater resilience to the euro-zone crisis due to looming uncertainties on account of possibility of Greek default. Also the financial markets and capital markets have shown greater degree of preparedness for the possible hike in federal interest rates in the USA. According to the reports/data released by several international financial institutions and rating agencies, it has been estimated that India is poised to be the world's fastest growing economy outpacing China soon. Besides, the Indian Economy is going through a policy reform regime marked by several steps taken to streamline legal, taxation and economic and environmental policies/ procedures. There are other factors such as drop in oil prices in the international market, decline in the inflation rates, fiscal consolidation and a more favourable balance of payments amongst others, which may help prepare a sound base for accelerated overall growth in India. With the outlook for the economy improving, the Company sees growth opportunities for its business in the year ahead. 3. SHARE CAPITAL There was no change in the share capital of the company during the year under review. The paid up equity capital remained at Rs. 500 Lakhs comprising of 50 lakh shares of Rs 10 each as on March 31, 2015. The company has not issued shares with differential voting rights nor granted stock options nor sweat equity. 4. DIVIDEND In view of insufficient profits made by the company due to reasons discussed above, your directors do not recommend any dividend for the current year under review. A sum of Rs. 6.21 lakhs has been transferred to the Reserves. Pursuant to transitional provisions prescribed in Schedule II of the Companies Act, 2013, the Company has adjusted an amount of Rs. 1.10 lakhs against the opening balance in the statement of Profit & Loss Account under Reserve & Surplus. 5. 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. 6. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY The Company has an Internal Control System, commensurate with the size and nature of its operations. During the year, controls were tested and no material weakness in design and operation were observed. 7. DIRECTORS & KEY MANAGERIAL PERSONNEL In accordance with the provisions of the Companies Act, 2013, Mr. Nawal Agrawal (DIN - 01753155), Director of the Company will be retiring by rotation at the ensuing Annual General Meeting and is eligible for re-appointment. Mr. Lalit Kuimar Dangi (DIN: 00886521) has been appointed as the Chief Executive Officer with effect from 22.1.2015 for a term of three years. Details about his remuneration are provided in the Notice as well as Annexure to the Directors' Report. During the year under review, Mr. Ramesh Jain (DIN: 1682905) has been appointed as the CFO of the Company with effect from 22.1.2015 for a term of three years. Dr. (Mrs) Vandna Dangi (DIN: 00886496) who was appointed as a Woman Director with effect from 05.12.2014 as an additional Director and whose term ends on the conclusion of this Annual General Meeting as per the relevant provisions of the Companies Act, 2013 and the Articles of Association of the Company is proposed to be appointed as the Woman Director on the Board, liable to retire by rotation. The details about her candidature are given in the Notice and the Explanatory Statement attached thereto. Mr. Yogesh R. Choksey (DIN: 00451871) and Mr. T.R. Ramanathan (DIN: 01680773) are proposed to be re-appointed as Independent Directors of the Company for a term of five years, not liable to retire by rotation, in pursuance to the relevant provisions of the Companies Act, 2013. The details about these directors have been given in the Notice and the Explanatory Statement annexed thereto. 8. CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS In pursuance of SEBI Circular CIR/CFD/POLICY CELL/7/2014 dated September 15, 2014 to all Recognized Stock Exchanges, amongst others, made the compliance with the provisions of amended Clause 49 of the Listing Agreement, non-mandatory for time being, to those companies having paid-up equity share capital not exceeding Rs 10 Crore and Net Worth not exceeding 25 Crore as on the last day of the previous financial year. Considering that the Company's paid-up equity share capital was less than Rs 10.00 Crore and the Net Worth was less than Rs 25 crore as on 31.3.2014, compliance with the provisions of revised Clause 49 of the Listing Agreement are not mandatory to the Company. Therefore, a separate Section on Corporate Governance and Management Discussion and Analysis Report and other details as stipulated under Clause 49 of the Listing Agreement with the Stock Exchange does not form part of this Annual Report. 9. NUMBER OF THE MEETINGS OF THE BOARD OF DIRECTORS During the Year 6 Board Meetings were convened and held on 26.5.2014, 30.7.2014, 19.08.2014, 31.10.2014, 5.12.2014 and 21.1.2015. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013. 10. DECLARATION GIVEN BY INDEPENDENT DIRECTORS As per the requirement of Section 149 (7) of the Companies Act, 2013, the Independent Directors have given their respective declarations that they meet the criteria of independence as specified under Section 149 (6) of the Act. 11. REMUNERATION POLICY Based on the recommendation of the Nomination & Remuneration Committee, the Board of Directors has approved and adopted a Remuneration policy for Directors, Key Managerial Personnel and other employees of the Company under section 178 (3) of the Companies Act, 2013. The remuneration policy is annexed to this Report and forms part of this Report. 12. CODE OF CONDUCT The Code of Conduct for the Board of Directors and the Senior Management has been adopted by the Company. The Code of Conduct has been disclosed on the website of the company at www.libord.com . 13. SUBSIDIARY COMPANIES/ ASSOCIATED COMPANIES The Company does not have any Subsidiary Company or Associate Company as defined under the provisions of the Companies Act, 2013. 14. VIGIL MECHANISM / WHISTLE BLOWER POLICY The Company has adopted a Whistle Blower Policy to report to the Management instances of unethical behaviour, actual or suspected, fraud or violation of the Company's code of conduct or ethics policy. Under this policy, the employees can approach the Company's Compliance Officer and/or Chairman of the Audit Committee. Whistle Blower Policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination be meted out to any person for a genuinely raised concern. The Whistle Blower Policy of the Company is posted on the website of the Company. 15. 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 Company's 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 "Code of Fair Disclosure, Internal Procedures and Conduct for Regulating, Monitoring and Reporting of Trading by Insiders" has been adopted and has been disclosed on the website of the company at www.libord.com . 16. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE The provisions of Section 135 of the Companies Act, 2013 are not presently applicable to the Company. 17. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to the requirement under Section 134 (3c) & (5) of the Companies Act, 2013, with respect to Directors' Responsibility Statement, it is hereby confirmed: (i) That in the preparation of the accounts for the financial year ended 31st March, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures; (ii) That the Directors have selected such accounting policies and applied them consistently and made judgments and estimates (iii) that were 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 or loss of the Company for the year under review. (iv) That the Directors have taken proper and sufficient care of 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. (v) That the Directors have prepared the accounts for the financial year ended 31st March, 2015 on a going concern basis. That the Directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. (vi) 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 18. BUSINESS RISK MANAGEMENT Pursuant to section 134 (3) (n) of the Companies Act, 2013, the Company has undertaken suitable measures for the development and implementation of a risk management policy for the company including identification of elements of risk, if any, which in the opinion of the board may threaten the existence of the company. At present the company has not identified any element of risk which may threaten the existence of the Company. 19. BOARD EVALUATION The performance of Board of Directors and the Committees constituted by the Board and the individual Directors has been evaluated during the Financial Year ended 31st March 2015. 20. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES Particulars of contracts or arrangements with related parties as required pursuant to the provisions of section 134(3)(h) and rule 8 of the Companies (Accounts) Rules, 2014 in form no. AOC- 2 is annexed to this report and forms part of this report. 21. PARTICULARS OF MATERIAL ORDERS During the year under review, neither any Regulator nor any Court or Tribunal has passed any significant and material order impacting the going concern status and the Company's operations in future. 22.PURCHASE OF SHARES OF THE COMPANY The Company does not give any loan, guarantee or security, or any financial assistance to the employees of the Company for the purpose of purchase or subscription for any shares of the Company pursuant to Section 67 (2) of the Companies Act, 2013. 23. EXTRACT OF ANNUAL RETURN An extract of the Annual Return as provided under section 92(3) of the Companies Act, 2013 is annexed to this Report and forms part of this Report. 24. AUDIT COMMITTEE a) Terms of Reference To oversee, interalia, the Company's financial reporting process and disclosure of its financial information, to recommend the appointment of Statutory Auditors and fixation of the audit fees, to review and discuss with the Auditors about internal control systems, scope of audit including observations of the auditors on adequacy of internal control systems, major accounting policies & practices, adopting accounting standards and complying various requirements concerning financial statements, if any, to review the Company's quarterly and annual financial statements before submission to the Board of Directors. b) Composition of Audit Committee The Audit Committee comprises of three directors with Independent Directors forming the majority. Mr. Yogesh R. Choksey is the Chairman of the Audit Committee. Mr. T.R. Ramanathan and Mr. Nawal Agrawal are the other two members of the Audit Committee. The members possess adequate knowledge of accounts, audit and finance, among others. The composition of the Audit Committee meets the requirement as per section 177 of the Companies Act, 2013. There are no recommendations of the Audit Committee which have not been accepted by the Board. During the year four Audit Committee meetings were held on 26.05.2014, 30.07.2014, 31.10.2014 & 21.01.2015. 25. 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, Ms Shivani Surana, Member of the Institute of Company Secretaries of India (Membership Number 35359) and a Company Secretary in Practice (CP No. 13273) had been appointed for conducting the Secretarial Audit of the Company for the financial year 2014-15. As required under section 204 (1) of the Companies Act, 2013 the Company has obtained a Secretarial Audit Report. 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 (3) of the Companies Act, 2013 besides that the Company could not appoint a Company Secretary in the Year 2014-15 as it could not locate a suitable candidate. The company is currently in the process of appointing a Company Secretary. 26. AUDITORS At the Annual General Meeting, Members will be required to appoint Auditors for the next term. M/s. Amar Bafna & Associates, Chartered Accountants, Mumbai, the existing Auditors have furnished a certificate, confirming that if re-appointed, their re-appointment will be in accordance with Section 139 read with Section 141 of the Companies Act, 2013. The Members are requested to consider their re-appointment as Auditors of the Company for the next term of one year, and authorize the Board of Directors to fix their remuneration. The Auditors Report to the shareholders for the year under review does not contain any qualification. 27. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENT The company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013. 28. STATEMENT PURSUANT TO LISTING AGREEMENT The Company's Equity Shares are listed at BSE Ltd., Mumbai. The listing fee for the year under review has been paid to BSE timely. 29. PERSONNEL The information required to be disclosed in the Directors' Report pursuant to section 197 of the Companies Act 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rule 2014 is set out as an Annexure to the Report. 30. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO (A) CONSERVATION OF ENERGY Not Applicable. (B) TECHNOLOGY ABSORPTION Not Applicable. 31. ACKNOWLEDGEMENTS Your Directors place on record their appreciation for the valuable contribution made by the staff members of the company. Your Directors wish to place on record their appreciation for the active support given by Banks, Investors, Shareholders, Brokers, Employees and Customers. By the Order of the Board Mr. Lalit Kumar Dangi Chief Executive Officer Date: 31.07.2015 Place: Mumbai |