Trade receivables are amounts due from customers for services rendered in the ordinary course of business. No trade or other receivable is due from directors of the company either severally or jointly with any other person. Nor any trade or other receivable are due from firms or private companies respectively in which any director is a partner, a director or a member.
(ii) Rights attached to equity shares:
The company has only one class of equity share having a per value of Rs. 10/- per shares. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of shareholder in the ensuing annual general meeting.
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive the remaining assets of the Company, after setting the dues of preferential and other creditors as per priority. The distribution will be in proportion to the number of equity shares held by the shareholder.
(iii) Shares received under option: Nil
(IV) Aggregate Number of shares issued for consideration other than cash and shares bought back during the period of 5 years immediately preceding the date March 31, 2025: Nil
(VII) Capital Management:
The Company’s objective for capital management is to maximize shareholder value, safeguard business continuity and support the growth of the Company. The Company is not subject to any externally imposed capital requirements
Nature and purpose of reserve
(A) Securities premium
Securities premium reserve is used to record the premium on issue of shares. The reserve can be utilized only for limited purposes such as issuance of bonus shares, writing off the preliminary expenses in accordance with the provisions of the Companies Act, 2013.
(B) General reserve
Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. Consequent to introduction of Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn. However, the amount previously transferred to the general reserve can be utilized only in accordance with the specific requirements of Companies Act, 2013.
(C) Equity-settled share-based payment reserve
This reserve is created by debiting the statement of profit and loss account with the value of share options granted to the employees by the Company. In case of share options granted by the Company, the reserve will move to the share capital account on issue of shares. There is no amount of such reserve with us.
(D) Retained earnings
Retained earnings are the profits that the Company has earned till date, less any transfers to general reserve, dividends or other distributions paid to shareholders. It also includes actuarial gains and losses on defined benefit plans recognized in other comprehensive income (net of taxes).
The applicable Indian corporate statutory tax rate for the year ended March 31, 2025 and March 31, 2024 is 25.17% and 25.17% respectively. The decrease in corporate statutory tax rate to 25.17% is consequent to changes made in the Taxation Law (Amendment) Ordinance 2019.
Note No. 23: FINANCIAL INSTRUMENTS
Refer to financial instruments by category table below for the disclosure on carrying value and fair value of financial assets and liabilities. For financial assets and liabilities maturing within one year from the Balance Sheet date and which are not carried at fair value, the carrying amounts approximate fair value due to the short maturity of these instruments.
Fair value hierarchy:
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions (i.e., an exit price), regardless of whether that price is directly observable or estimated using a valuation technique.
The investments included in level 1 of fair value hierarchy have been valued using quoted prices for instruments in an active market. The investments included in level 2 of fair value hierarchy have been valued using valuation techniques based on observable market data. The investments included in Level 3 of fair value hierarchy have been valued using the income approach and break-up value to arrive at their fair value. There is no movement from between Level 1, Level 2 and Level 3. There is no change in Inputs use for measuring Level 3 fair value.
Financial risk management Risk management framework
The Company has established a comprehensive system for risk management and internal controls for all its businesses to manage the risks that it is exposed to. The objective of its risk management framework is to ensure that various risks are identified, measured and mitigated and also that policies, procedures and standards are established to address these risks and ensure a systematic response in the case of crystallization of such risks.
The Company has exposure to the following risk arising from financial instruments:
a) Credit risk b) Liquidity risk c) Market risk
The Company has established various policies with respect to such risks which set forth limits, mitigation strategies and internal controls to be implemented by the three lines of defence approach provided below. The Board oversees the Company’s risk management and has constituted a Risk Management Committee (“RMC”), which frames and reviews risk management processes and controls. The risk management system features a “three lines of defense” approach:
1. The first line of defense comprises its operational departments, which assume primary responsibility for their own risks and operate within the limits stipulated in various policies approved by the Board or by committees constituted by the Board.
2. The second line of defense comprises specialized departments such as risk management and compliance. They employ specialized methods to identify and assess risks faced by the operational departments and provide them with specialized risk management tools and methods, facilitate and monitor the implementation of effective risk management practices, develop monitoring tools for risk management, internal control and compliance, report risk related information and promote the adoption of appropriate risk prevention measures.
3. The third line of defence comprises the internal audit department and external audit functions. They monitor and conduct periodic evaluations of the risk management, internal control and compliance activities to ensure the adequacy of risk controls and appropriate risk governance and provide the Board with comprehensive feedback.
a) Credit risk:
It is risk of financial loss that the Company will incur a loss because its customer or counterparty to financial instruments fails to meet its contractual obligation. The Company’s financial assets comprise of Cash and bank balance, Securities for trade, Trade receivables, Loans, Investments and Other financial assets which comprise mainly of deposits and unbilled revenues.
Trade Receivables:
The Company has followed simplified method of ECL in case of Trade receivables and the Company recognizes lifetime expected losses for all trade receivables that do not constitute a financing transaction. At each reporting date, the Company assesses the impairment requirements.
Based on the industry practices and business environment in which the entity operates, management considers that the trade receivables are in default if the payment is 90 days overdue. Out of the total trade receivables of Rs. 0 (previous year Rs. 0.88 Lacs) & Rs. 0.lacs (previous year Rs. 0.0 lakhs) are overdue for a period in excess of 90 days. Probability of default (PD) on bls is considered as nil.
Other financial assets considered to have a low credit risk:
Credit risk on cash and cash equivalents is limited as we generally invest in deposits with banks with high credit ratings assigned by international and domestic credit rating agencies. Investments comprise of Quoted Equity instruments, Bonds, Mutual Funds and Commercial papers which are market tradeable. Other financial assets include deposits with qualified clearing counterparties and exchanges as per the prescribed statutory limits.
b) Liquidity risk
Liquidity represents the ability of the Company to generate sufficient cash flow to meet its financial obligations on time, both in normal and in stressed conditions, without having to liquidate assets or raise funds at unfavorable terms thus compromising its earnings and capital.
Liquidity risk is the risk that the Company may not be able to generate sufficient cash flow at reasonable cost to meet expected and / or unexpected claims. It arises in the funding of lending, trading and investment activities and in the management of trading positions.
The Company aims to maintain the level of its cash and cash equivalents and other highly marketable investments at an amount in excess of expected cash outflow on financial liabilities. This is sufficient to take care of short period requirements as well.
MATURITY ANALYSIS
The table below summarize the maturity profile of the undiscounted cash flow of the Company’s financial assets and liabilities as at 31.03.2025.
c) Market risk
Market risk arises when movements in market factors (foreign exchange rates, interest rates, credit spreads and equity prices) impact the Company’s income or the market value of its portfolios. The Company, in its course of business, is exposed to market risk due to change in equity prices, interest rates and foreign exchange rates. The objective of market risk management is to maintain an acceptable level of market risk exposure while aiming to maximize returns. The Company classifies exposures to market risk into either trading or non-trading portfolios. Both the portfolios are managed using the following sensitivity analyses:
i) Equity Price Risk
ii) Interest Rate Risk
iii) Currency Risk
i. Equity Price Risk
The Company’s exposure to equity price risk arises primarily on account of its proprietary positions and on account of margin-based positions of its clients in equity cash and derivative segments. The Company’s equity price risk is managed in accordance with its Corporate Risk and Investment Policy (CRIP) approved by its Risk Management Committee. The CRIP specifies exposure limits and risk limits for the proprietary desk of the Company and stipulates risk-based margin requirements for margin-based trading in equity cash and derivative segment by its clients. The below sensitivity depicts a scenario where a 10% movement in equity prices, everything else remaining constant, would result in an exchange obligation for both Traded and Non-traded (client) positions and their impact on statement of profit and loss account considering that the entire shortfall would be made good by the Company.
ii. Interest Rate
The Company’s exposure to interest rate risk arises primarily on account of its proprietary positions and on account of margin-based positions of its clients in exchange traded interest rate derivatives on government securities. However, the company’s exposure to Interest segment is nil during the year under review.
The Company’s interest rate risk is managed in accordance with its CRIP approved by its Risk Management Committee. The CRIP specifies exposure limits and risk limits for the proprietary desk of the Company and stipulates risk-based margin requirements for margin-based trading in interest rate derivatives by its clients.
The non-traded Financial Assets and liabilities are fixed rate instruments and are valued at amortized cost. Any shifts in yield curve will not impact their carrying amount and will therefore not have any impact on the Company’s statement of profit and loss.
iii. Foreign Exchange Risk/Currency Risk
The Company’s exposure to currency risk arises primarily on account of its proprietary positions and on account of margin positions of its clients in exchange traded currency derivatives. However, the Company’s exposure to exchange traded currency derivates is nil during the year under review.
The related parties as above acted as client for dealing in securities where the brokerage is charged in the normal course of the business and the amount of brokerage is very insignificant, less than Rs.0.10 lacs (Prev. year Rs.0.12 lacs) in each case.
Note No. 25: Auditors Remuneration
Auditors’ remuneration comprises of fees to statutory Auditors Rs 0.50 lacs (Prev. year: Rs.0.50 Lacs), & for IT-44AB report & expenses reimbursement: Rs.0.25 lacs (Prev. year: Rs.0.25 Lacs), as increased by GST @ 18%.
Note No. 27: Contingent Liability
The Company has no contingent liabilities as on 31stMarch, 2025.
Note No. 28: Segment Reporting
The company is principally engaged in a single business segment viz: Stock Broking and Trading in Shares and Depository Participant. Accordingly, there are no separate reportable segments as per IND AS 108 on "Segment reporting”.
Note No. 29: In the opinion of the board the current assets loans and advances are approximate to the values state, if realized in the ordinary course of business.
Note 33: Additional Regulatory information as required per schedule III
i. Details of Benami property held:
No proceedings have been initiated on or are pending against the company for holding Benami property under the Benami transactions (prohibition) act,1988 and rules made thereunder.
ii. Wilful defaulter:
The company has not been declared willful defaulter by any Bank, financial institution, Government or government authority
iii. Relationship with struck off companies:
The company has no transactions with any company which has been struck off under Companies Act,2013 or 1956
iv. Compliance with number of layers of companies:
The company has complied with the number of layers prescribed under the companies act,2013.
v. Compliance with approved scheme of arrangements:
The company has not entered into any scheme of arrangement which has an accounting impact in the current or previous financial year.
vi. Utilization of Borrowed funds and share premium:
(i) The company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities(intermediaries) with the understanding that the intermediary shall:
a. directly or indirectly lends or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (ultimate beneficiaries), or
b. provides any guarantee, security or the like to or on behalf of the ultimate beneficiaries.
(ii) The company has not received any fund from any other person(s) or entity(ies), including foreign entities (funding party) with the understanding that the company shall:
a. directly or indirectly lends or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries), or
b. provides any guarantee, security or the like to or on behalf of the ultimate beneficiaries.
vii. Undisclosed Income:
There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the income tax act,1961, that has not been recorded in the books of accounts.
viii. Details of crypto currency or virtual currency: The company has not traded or invested in the crypto currency or virtual currency during the current of previous year.
ix. Valuation of property, plant and Equipment, right-of-use assets, investment properties and intangible assets: The company has not revalued its property, plant and Equipment, right-of-use assets, investment properties and intangible assets during the current of previous year.
x. Others: The company hasn’t received any whistle blower complaints during the current of previous year.
Note 34: Details of Micro, small and medium enterprises (MSME)
There have been no reported cases of delays in payment to Micro, small and medium enterprises (MSME) or of interest payments due to delays in such payments.
There is no supplier and buyer coverage under Micro, small and medium enterprises development Act, 2006. No enterprises have been identified as a "Supplier” under the Micro, small and medium enterprises (MSME) Development Act,2006. The aforesaid identification has been done on the basis of information, to the extent provided by the vendors to the company. This has been relied upon by the Auditors.
Note 35: Impact of Covid-19
The company is in the business of share broking and depository. The company has assessed the possible impact of Covid-19 on the financial statements and concluded that no adjustment is required in the financial statements. The company continue to monitor the future economic conditions.
Note 36: Code of Social Security:
The Code of Social Security,2020(Code) relating to employee benefit during employment and post-employment received Parliament approval and the Presidential assent in September 2020. The Code has been published in the gazette and subsequently on 13.11.2020, draft rules were published and invited for stakeholders’ suggestions. However, the date on which Code will come into effect has not been notified as on date. The company will assess the impact of the code as and when the same comes into effect and accordingly, record any related impact in the year the code becomes effective.
Note 37: CSR activities
Where the company covered under section 135 of the Companies act, the following shall be disclosed with regard to CSR activities: Not applicable on the company
i. Amount required to be spent by the company Nil
ii. Amount of expenditure incurred Nil
iii. Shortfall at end of the year Nil
iv. Total of previous year shortfall Nil
v. Reason for shortfall: NA
vi. Nature of CSR activities: NA
vii. Details of related party transactions e.g. Contribution to the trust controlled by the company: Nil
viii. where provision is made w.r.t. liability incurred by entering into a contractual obligation, the movements in the provision during the financial year should be shown separately.
Note 38: As per Accounting standard (Ind.AS19), “Employee benefits”:
The disclosure of employee benefits as defined in the AS are given below: -Both in respect to defined Contribution Plan and defined Benefit Plan are not applicable on the company during the current year or the previous year. The provisions of the Provident Act and the Gratuity Act are not applicable on the company during the current year or the previous year.
Note 39: Additional information as required under Schedule III of the Companies Act,2013
The company is into the business of stock broking, investment & depository, hence there are nil amounts of Raw materials, work in progress, stores and spares, both indigenous or imported, during the current year or the previous year.
Note 40: Economic Assumptions
The principal assumptions are the discount rate and salary growth rate. The discount rate is generally based on the market yields available on the government bonds at the accounting date with a term that matches that of the liabilities and the salary growth rate takes account of inflation, seniority, promotion and other relevant factors on the long-term basis.
Note No. 41: Balances of Sundry Creditors and Debtors are subject to their confirmation.
Note No.42: The figures have been rounded off to the nearest rupee. The previous years’ figures have been re-grouped, re-arranged, re-classified wherever necessary to facilitate comparison with the current years’ figures. Page | 8
Note No. 43: There have been no events after the reporting date that require disclosure in these financial statements.
Note No. 44: Disclosure under Regulation 34(3) of the SEBI (LODR), Regulation, 2015
There are no loans and advances in the nature of loans given to subsidiaries, associates and firms / companies in which director is interested.
Notes 1 to 44 forming an integral part of the financial statements.
As per our report of even date attached.
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