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Aurionpro Solutions Ltd (AURIONPRO) -BSE
93.2 0.00 (0.00%) 16-Aug-2019 |00:00
PREV.CLOSE OPEN PRICE HIGH(Rs) LOW(Rs) VOLUME(Rs) 52AVG.RANGE MARKET CAP(Rs.Cr) P/E Div Yield (%) Eps (Rs)
93.2 92.7 94.8 91.95 2038 199.75 - 91 220.29 20.04 2.15 4.65
Directors Report

To the Members of Aurionpro Solutions Limited,

The Directors are pleased to present Twenty First Annual Report of the Company, together with its audited financial statements for the year ended 31st March 2018.

1. FINANCIAL RESULTS

The financial performance of the Company on Consolidated Basis:

(Rs in Lakhs)

31 March 2018

31 March 2017

Income
Revenue from operations

41854.54

49,390.26

Other Income

569.21

846.39

Total Revenue

42423.75

50,236.65

Operating Expenses

12922.06

17,720.32

Change of Inventories of raw material, finished goods and stock-in-trade

(683.11)

(220.69)

Employee benefits expense

17429.41

20,957.25

Finance costs

1396.69

1,637.28

Depreciation and amortization expenses

3224.65

2,952.57

Other expenses

4199.97

6,341.54

Total expenses

38489.67

49,388.27

Profit before tax, minority interest and exceptional item

3,934.08

848.38

Add/Less: Exceptional item

-

2759.71

Profit before tax and minority interest

3,934.08

3608.09

Income tax expense:
(a) Current tax

1,029.94

305.13

(b) MAT credit utilized/entitlement

61.62

186.13

(c) Tax adjustment of earlier years

-

275.37

(d) Deferred tax credit

(946.61)

(410.23)

Profit after tax but before minority interest

3789.13

3251.69

Less: Minority interest

-

-

Profit after tax from Continued Operations

3,789.13

3251.69

Profit before Tax from Discontinued Operations

10,806.79

1288.30

Tax Expenses of Discontinued Operations

3.171.39

322.19

Profit after Tax from Discontinued Operations

7,635.40

966.11

Profit for the period attributable from Continued Operations
(a) Equity holders of the company

2,937.20

3470.58

(b) Non Controlling Interest

851.93

(218.89)

Profit for the period attributable from discontinued Operations
(a) Equity holders of the company

5,918.69

1031.14

(b) Non Controlling Interest

1,716.71

(65.03)

Note:

1) Pursuant to its Order dated July 27, 2018, the Hon'ble National Company Law Tribunal, Mumbai (NCLT) has sanctioned the Scheme of Demerger (“the Scheme) in terms of which certain businesses, including Interactive Customer Communication (Interact DX) and Supply Chain Solutions (Logistics) were demerged and transferred into Trejhara Solutions Ltd. The Appointed Date for the Scheme was March 31, 2017. Therefore, the figures stated above are after giving effect of the 'Accounting Treatment' envisaged under the Scheme.

2) The previous year's figures have been regrouped/re-classified, wherever required and the same are not comparable due to effect of the Demerger as per the Scheme of Demerger.

3) Figures of the Statement of Profit and Loss for the year ended 31 March, 2017 includes demerged business performance, hence current year figures are not comparable with those for the previous year. (Refer Note 43)

The financial performance of the Company on Standalone Basis:

(Rs in Lakhs)

31March 2018

31 March 2017

Income
Revenue from operations

26793.99

21191.91

Other Income

577.88

816.85

Total Revenue

27371.87

22008.76

Operating Expenses

13448.91

7450.63

Change of Inventories of raw material, finished goods and stock-in-trade

(717.20)

120.71

Employee benefits expense

8200.66

8075.19

Finance costs

1020.19

916.99

Depreciation and amortization expenses

1166.92

1329.6

Other expenses

2523.01

2297.32

Total expenses

25642.49

20190.44

Profit before tax, minority interest and exceptional item

1729.38

1818.32

Add/Less: Exceptional item

-

-

Profit before tax and minority interest

1729.38

1818.32

Income tax expense:
(a) Current tax

678.69

333.34

(b) MAT credit utilized/entitlement

61.61

186.13

(c) Tax adjustment of earlier years

-

285.71

(d) Deferred tax credit

(237.56)

31.04

Profit After Tax

1226.64

982.10

Note:

1) Pursuant to its Order dated July 27, 2018, the Hon'ble National Company Law Tribunal, Mumbai (NCLT) has sanctioned the Scheme of Demerger (“the Scheme) in terms of which certain businesses, including Interactive Customer Communication (Interact DX) and Supply Chain Solutions (Logistics) were demerged and transferred into Trejhara Solutions Ltd. The Appointed Date for the Scheme was March 31, 2017. Therefore, the figures stated above are after giving effect of the 'Accounting Treatment' envisaged under the Scheme.

2) The previous year figures have been regrouped/re-classified, wherever required and the same are not comparable due to effect of the Demerger as per the Scheme of Demerger.

3) Figures of the Statement of Profit and Loss for the year ended 31 March, 2017 includes demerged business performance, hence current year figures are not comparable with those for the previous year. (Refer Note 46)

2. MATERIAL CHANGES & COMMITMENTS

SCHEME OF DEMERGER:

The Board of Directors of the Company had, on May 9, 2017 approved the scheme of arrangement (“the Scheme”), under Section 230-232 of the Companies Act, 2013, for the demerger of certain businesses of Aurionpro Solutions Limited (hereinafter referred to as (“Aurionpro”) into Trejhara Solutions Limited (“Trejhara”). Subsequently, after obtaining approval from the stock exchanges and shareholders (through an NCLT convened meeting held on January 23, 2018) the Scheme was approved by the Hon'ble National Company Law Tribunal, Mumbai vide its Order dated July 27, 2018. The same was filed with the Registrar of Companies on August 2, 2018, then the Scheme became effective.

The 'Appointed Date' as per the Scheme was fixed at March 31, 2017, with effect from which the 'Demerged Undertaking' which inter alia includes all the operations, including assets and liabilities pertaining to the 'Demerged Business' have been transferred to the Trejhara. Accordingly, the audited financial statements for the year ended March 31, 2018, in this Annual Report, has been published after giving effect of the 'Accounting Treatment' envisaged under the Scheme. The financial statements for the year ended March 31, 2017, have also been re-stated to the extent of the impact of the Scheme for comparison purpose.

Apart from above, there are no material changes and commitments affecting the financial position of the Company which have occurred between the end of financial year of the Company to which the financial statements relate and the date of this report.

2. DIVIDEND

The Company has witnessed healthy growth in the financial year 2017-18, taking note of the same, the Board of Directors (“the

st

Board”) has recommended dividend at the rate of Rs 2/- per equity share (20%) for the financial year ended 31 March, 2018.The total payout towards dividend and tax thereon will be Rs 568.42 Lakhs.

The Members may approve the proposed dividend.

3. STATE OF COMPANY'S AFFAIRS

The demerger of the non-core business lines has been completed. The demerger was aimed at unlocking value of the demerged businesses as well as other core business of the Aurionpro. The demerger will enable the management to provide focused attention in terms of management support and investment to each of core businesses of the Company. After demerger, the management has focused on sharpening and strengthening three core businesses - Cybersecurity, Banking & Fintech and Government solutions.

Increase in business of Digital Innovation & Government Services has led to growth in revenue. The Company has enough presence in Government Services business and is confident of executing it in the most efficient way and hoping for more business to tick in which will help us grow our top line with accelerated margins. Shift towards IP Portfolio (Cybersecurity, Digital Innovation & Banking and Fintech) has led to margin expansion, going ahead the Board expects the accelerated growth from better monitization of the portfolio in existing and new markets.

The details on operational & financial performance are covered at length in the Management Discussion and Analysis Section, forming Part of this Report.

4. FINANCIAL RESOURCES/FUND RAISING (a) ESPS:

During the year, with an objective to retain and attract talent in the organization, the Company had launched Employee Share Purchase Scheme, 2017 (“ESPS 2017”), which was approved by the Members through Postal Ballot, results of which were declared on 7th September, 2017. The ESPS 2017 has been framed and implemented in compliance with the SEBI (Share Based Employee Benefits) Regulations, 2014.

In terms of the ESPS 2017, the shares are offered to the eligible employees of the Company and its subsidiaries, at a face value i.e Rs 10/- per share. The Board of Directors (including Committee of the Board empowered for this purpose) has been empowered to identify eligible employees, based on their performance evaluation. The equity shares issued under the ESPS 2017 are subject to the lock-in for a period of one year as per the SEBI (Share Based Employee Benefits) Regulations, 2014.

The details of the shares issued and allotted under the ESPS, 2017 as on the date of this Report, are as under:

Particulars

Outstanding Shares

Total Number of Shares for which In principle approval received from the stock exchanges

11,51,765

Less: Number of Shares allotted on 28th December, 2017

1,14,000

Less: Number of Shares allotted on 10th January, 2018

4,65,000

Less: Number of Shares allotted on 19th June, 2018

16,000

Number of Shares available for further Grant

5,56,765

6. SUBSIDIARIES/JOINT VENTURES/ASSOCIATE COMPANIES

The details of Subsidiaries/Joint Ventures/Associate Companies and changes thereto, if any, has been provided in MGT-9, which forms part of this Directors Report.

7. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in the prescribed form MGT-9 is annexed herewith as “Annexure 1”.

8. CORPORATE GOVERNANCE

The Report on corporate governance as per the requirements of Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, forms part of this Annual Report. Further, the requisite certificate from M/s. Milind Nirkhe & Associates, Practicing Company Secretaries, confirming the compliance with the conditions of corporate governance has been included in the said Report.

9. MANAGEMENT DISCUSSION AND ANALYSIS (MDA)

Management Discussion and Analysis for the year under review, as required under Regulation 34 (2) (e) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, has been covered in a separate section forming part of this Annual Report.

10. CORPORATE SOCIAL RESPONSIBILITY (CSR)

In accordance with the provisions of Section 135 read with Schedule VII of the Companies Act, 2013 the Company has adopted a CSR Policy outlining various CSR activities to be undertaken by the Company. The CSR Policy of the Company is available on the website of the Company at www.aurionpro.com.

During the year under review, the Company has contributed Rs 40 Lakhs towards the activities in the area of education and academics and the institution working therefor.

The Board has constituted a 'CSR committee' which comprises of following directors:

Ms. Carol Realini - Chairperson Dr. Mahendra Mehta - Member Mr. Amit Sheth - Member Mr. Samir Shah - Member

The CSR Committee, inter alia determines the budget for funding various charitable activities and the recommends the contributions to be made to various initiatives.

The disclosures, as required under Rule 9 of the Companies (Corporate Social Responsibility Policy) Rules, 2014, has been enclosed to this Report as “Annexure 2”.

11. INTERNAL CONTROL SYSTEM & THEIR ADEQUACY

The Company has an internal control system which commensurate with the size, scale and nature of its operations. The Internal Audit Team monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies of the Company. The Company is not required to maintain cost records specified by Central Government under section 148(1) of the Companies Act - 2013.

12. DIRECTORS' RESPONSIBILITY STATEMENT

In terms of the provisions of Section 134(3)(c) of the Act, the Board confirm that:

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

ii) 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 31st March, 2018 and of the profit and loss of the Company for that period;

iii) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) the Directors had prepared the annual accounts on a going concern basis; and

v) the Directors, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

13. DIRECTORS/KEY MANAGERIAL PERSONNEL (KMP)

(a) Board of Directors:

Pursuant to the provision of Section 152(6) of the Companies Act, 2013, and article 127 of the Articles of Association of the

Company Mr. Sanjay Desai, Director is retiring by rotation, and being eligible, offers himself for reappointment at the ensuing Annual General Meeting.

All Independent Directors have given declarations affirming that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The information as required to be disclosed under regulation 36 of the Listing Regulations in case of reappointment of director is provided in Corporate Governance Report forming part of the Annual Report.

During the year under review, Mr. Hariharan Sambhashiva resigned from the Directorship with effect from 30th May, 2018, due to his pre-occupation and other professional commitments. The Directors place on record their sincere appreciation towards the services rendered by Mr. Hariharan Sambhashiva during his tenure as director of the Company.

(b) KMP

During the year, at the meeting held on August 28, 2018, Mr. Sachin Sangani was appointed as the Chief Financial Officer of the Company. In the same meeting, Mr. Samir Shah, CEO & Director was also designated as a Key Managerial Person, alongwith Mr. Sachin Sangani, CFO and Mr. Ninad Kelkar, Company Secretary.

14. PERFORMANCE EVALUATION

The Company's policy relating to appointment and remuneration of Directors, KMPs and other employees including criteria for determining qualifications, positive attributes and independence of Directors are covered under the Corporate Governance Report which forms part of this Annual Report.

The Board of Directors annually evaluate its own performance and that of its committees and individual Directors.

The Board has formulated the Nomination and Remuneration Policy for selection and appointment of Directors, senior management personnel and their remunerations. http://www.aurionpro.com/investors/.

15. MEETINGS

During the year under review, the Board met eight times and the gap between two meetings did not exceed 120 days.

16. COMMITTEES

As on the date of this report, the Board has four committees-

i) Audit Committee; ii) Nomination and Remuneration/Compensation Committee; iii) Stakeholder Relationship/Investor Grievance and Share Transfer Committee; and iv) Corporate Social Responsibility Committee.

The detailed information in relation to these committees, including composition and the terms of reference and other details are provided in Corporate Governance Report.

17. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has established the necessary vigil mechanism and has put in place a 'Whistle Blower policy' in order to enable the employees and Directors of the Company to report their concerns about the management, operations and other affairs of the Company. In terms of the Whistle Blower Policy, the whistle blowers are provided an access to the Audit Committee to lodge their concerns. This policy is available on the website of the Company at http://www.aurionpro.com/investors/.

18. RISK MANAGEMENT POLICY

The Company has formulated a comprehensive Risk Management Policy to identify, assess and mitigate various risks associated with the Company. This policy is available on the website of the company at http://www.aurionpro.com/investors/.

19. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186

The details of loans, guarantees and investments, covered under the provisions of Section 186 of the Companies Act, 2013, if any, are given under the notes to the standalone financial statements forming part of this annual report.

20. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All the related party transactions entered into during the financial year were on an arm's length basis and were in the ordinary course of business. During the financial year, the Company has not entered into any contract/arrangement, transactions with related parties which could be considered material in accordance with the policy of the Company as to related party transactions. The details of all related party transactions are placed before the Audit Committee for approval. The policy as to

Related Party Transactions, as approved by the Board, is available on the Company's website at http://www.aurionpro.com/investors/.

The details of transactions entered into with the related parties are disclosed in the notes to the stand alone financial statements forming part of this Annual Report.

21. PUBLIC DEPOSITS

During the year, the Company has neither invited nor accepted any public deposits.

22. AUDITORS AND AUDIT REPORT:

M/s. Chokshi & Chokshi LLP, were appointed as the Statutory Auditors of the Company at the Annual General Meeting Held on September 26, 2017 for a term of 4 years.

The Statutory Auditors of the Company has stated in their report that, during the course of Audit no fraud on or by the Company has been noticed or reported.

23. SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013, and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Secretarial Audit was carried out by M/s. Milind Nirkhe & Associates, Company Secretary in Practice. The Report of the Secretarial Audit is annexed herewith as “Annexure 3”.

The qualifications raised by the Secretarial Auditor and Board's response thereto are as under.

Qualification: The Board of Directors of the Company consists of Seven (7) Directors, consisting of 3 Non- Executive Directors, 1 Executive Director and 3 Independent Directors. Presently the composition of the Board of Directors is not in conformity with Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Response: The Board has taken cognizance of this and the Board shall be re-constituted soon as per the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

24. PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 197(12) of the Act read with the Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules is provided in a separate annexure forming part of this Report. Having regard to the provision of the first proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the Members of the Company. In terms of Section 136, the said annexure is open for inspection at the Registered Office of the Company. Any Member interested in obtaining a copy of the same may write to the Company Secretary.

The disclosures pertaining to the remuneration and other details as required under section 197(12) of the Act read with Rule 5(1) of the of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, have been provided in the Annual Report as “Annexure 4”.

25. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of section 134(3)(m) of the Companies Act, 2013, read with rule 8 of the Chapter IX The Companies (Accounts) Rules, 2014, the Directors furnish herein below the required additional information:

Conservation of Energy:

Although the operations of the Company are not energy intensive, the management is highly conscious of the criticality of the conservation of energy at all operational levels. The requirement of disclosure of particulars with respect to conservation of energy as prescribed in Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014, is not applicable to the Company and hence are not provided.

Technology Absorption:

The Company continues to adopt latest technologies and innovations for improving the productivity and quality of its products and service offerings. The Company is also partnering with major technology providers in global markets.

Foreign Exchange Earnings and Outgo:

The details of foreign exchange earned and spent by the Company during the year are given below:

26. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place necessary policy as required under the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. The Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. During the year under review, the Internal Complaints Committee had received one complaint of the nature covered under the said Act and the same was redressed. There are no pending cases.

27. 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.

28. DISCLAIMER AND FORWARD LOOKING STATEMENT

The statements in the Board's Report and the Management Discussion & Analysis describing the Company's objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company's operations include global and domestic demand and supply, input costs, availability, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

29. ACKNOWLEDGEMENTS

The Directors would like to place on record their sincere appreciation for the continued co-operation, support and assistance provided by all the stakeholders including the financial institutions, banks, customers, vendors, members and other government departments and authorities.

For and on behalf of the Board of Directors

Paresh Zaveri

Amit Sheth

Samir Shah

Chairman

Co-Chairman & Director

Chief Executive Officer

Navi Mumbai

Registered Office:

Synergia IT Park, Plot No. R-270, T.T.C. Industrial Estate, Near Rabale

Police Station, Rabale, Navi Mumbai -400701

Date: 06 August, 2018

   

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