DIRECTORS' REPORT To, The Member, The Directors have pleasure in presenting herewith the Thirty Third Annual Report of the Company together with Audited Accounts for the year ended 31st March, 2015. Your company has returned on growth path and looking to execute its expansion plans. This is well known fact that 90% of the retail investors had deserted capital market as they were finding trading in commodity and currency easier with less amount of margin requirement. The absence of physical settlement had reduced equity to piece of paper. The volatility has increased many folds. The equity market made new highs, the area of operations was dominated by FII and DII etc. and it was restricted to only Nifty and Sensex stocks. FIIs now own 23% of Sensex and Nifty stock and hence there is no alternative to them to remain bullish in India Your Company was accurate in predicting Nifty/Senses behavior which was based on your Company's Research capabilities. After BJP win the confidence has started re-surfacing. Even Global recovery is helping Indian Stock Markets to reach new levels. RBI has started cutting rates which should continue for next 18 months. We expect return of retail investors soon which occurs well for your company. Your Company's research has been well accepted by FIIs and overseas investors. Your Company's research is also helping members create wealth. 1200 odd companies are still suspended from trading, 2500 odd companies are in illiquid category and 800 are in trade to trade. This makes the equity investments and trading more challenging. Exit from such dead investments can raise investor's confidence alarmingly. Your management's vision and perception has not changed. We still hold that Sensex 41000 is not a dream. In fact with lower retail ownership the hurdles in such targets will be very low. We expect even to see Sensex crossing 45000 in next 3 years. Even others have started following CNI Research as they have started giving Sensex target of54000, 55000 & 58000, which is far in excess of CNI targets set last year. We expect good times to return and next four years will be good for market. We could not implement the business restructuring plans in last few years as the environment of business is continuously shrinking post LEHMAN issue and global economies are not responding to the changing environment. Those who tried to expand with leveraged debts are facing difficult challenges and going through the most difficult phase of their business. Most of debt ridden companies were not taken kindly by investors. Your company is still debt free. As reported last year some investors and promoters did infuse funds in the company though the same was not up to the mark. Your company may raise further funds to capitalize the growing capital market and growth opportunities. FATE OF ACHIEVEMENT: Your company which has strategic partnerships with the best global agencies in the world has been chosen for the prestigious award "Rashtriya Udyog Ratna Award" and "Quality Brand" from Council for Economic Growth and Research (CEGR) for company's outstanding contribution to society and to the nation. The fact that your company's content has been picked by NY times FT USA clearly suggests that the quality of the content is world class. Your company has been invited by many international rating and performance agencies for awards in the field of research. Research in India is at a nascent stage unlike US and hence the true value of research is yet to be exploded in real context. Your Company has been rated among one of the best RESEARCH firm by another US based research firm. Your Company is the only non broker professional research firm duly registered with SEBI hence stands out on its own. Even with regard to the research, your company ranked no 1 in India as it has maintained 95% strike rate in calls generated in A group investment and trading. The performance of your company is exhibited on the home page of the website of your company www.cniglobalbiz.com . Your company maintained consistency in the performance even the equity markets are swinging 10% every time. The continued association of all global agencies along with fresh addition to ties ups like ISI Emerging Market UK and Bloomberg USA clearly speaks high about the quality and brand of your company. Your company is now extending tie up in Europe. FUTURE PROSPECTS: Today India is the fastest growing economy behind China this means that our financial sector is performing very well and to achieve faster growth our financial sector would have to be wider in the sense that small companies should be given an opportunity to grow by providing them with the finance. The company has entered into a content sharing agreement with Thompson Reuters, Capital IQ a division of Standard & Poor's, Dow Jones Factiva a division of Dow Jones and TheMarkets.com division of Standard and Poor USA, Blue Matrix and ISI Emerging markets UK and Bloomberg for providing content and research on small and mid cap companies. This has helped the company to build its brand and make it an international brand. Time is changing very fast and the idea of setting first of its kind of research house is finding wide acceptance globally. Your company had also entered into high growth area such as investment banking and other financial solutions which are incidental to the core business of your company. Your company is now looking as fund based activities which can boost top line and bottom line of your company. RISK: Global markets recovered to all time high and even FED felt that QE needs to be eased. At the same time India is stepping out on growth. High leverage of FII to equity and diversion of investors to commodity and currency has killed the depth in Indian equity market. The policy makers persisted with FII favored policies which increased the volatility to the highest level in India. Investors are still not ready to return to capital market. So long as this will remain in the current state, we do not think that the broad base entry of retail investors can be seen Indian terrain. We hope some measures will be announced to bring back retail investors. Even Government of India is unable to sell its Shares of PSU companies to retail investors. The Ups and Downs of capital market has direct bearing on the revenue of the company and to counter the same your company has made sizable investments out of the current profits which are profitable. It was prudently decided by the management to invest in technology, investment opportunities instead of creating physical assets at this juncture. It has also checked the costs which will protect the business even in slumtimes. In internet business managing rising costs becomes a key subject of interest for investors, as they add employees and build up their infrastructures to support both expansion and ambitious innovation agendas. TRANSFER TO RESERVES: During the year under review, Rs. 54,719,780/- amount has been transferred to Reserves. DIVIDEND: The company is focusing on growth and hence, your directors not yet recommended dividend for the year under review. Your Company has rewarded members with good bonus track record and may continue its trend in future. CAPITAL STRUCTURE: The Board of Directors of the Company has allotted 5,00,00,000 Equity shares pursuant to conversion of warrants into Equity shares. As on date the paid up share capital of the Company is 11,48,04,500 DEPOSITS: During the period under review, your Company has not accepted/renewed any deposits. DIRECTORS In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the company, Mrs. Sangita Kishor Ostwal is liable to retire by rotation and being eligible offers himself for re- appointment. Also, the Board of Directors of the Company appointed Mr. Mehul Yadunandan Desai as an Additional Independent Director of the Company in the Board at the meeting held on 30th July, 2015 under Section 161 of the Companies Act, 2013 who holds office up to the date of this Annual General Meeting. Subject to approval of members the Company has received a notice along with requisite deposit from a member of the Company under Section 160 of the Companies Act, 2013, proposing his candidature for the office of independent Director for a period of five year consecutive years effective from the date the date of appointment by the Board i.e. from 30th July 2015 to 29th July, 2020. The Board recommends her appointment. The Company has received declaration from all the Independent Directors of the Company confirming that they meet criteria independence as prescribed under section 149(6) of the Companies Act, 2013. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS:- A calendar of meeting is prepared and circulated in advance to the Directors. During the year Seven Board Meetings and four Audit Committee Meetings were convened and held. The details of which are given as under: BOARD EVALUATION Pursuant to the provisions of the Companies Act, 2013 the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration. CORPORATE GOVERNANCE REPORT: Pursuant to Clause 49 of the Listing Agreement entered into with the Stock Exchanges, the Company has complied with all the provisions of Corporate Governance and a report on corporate governance is annexed hereto and forms part of this report. A certificate from Auditors of the Company regarding compliance of Corporate Governance, as stipulated under Clause 49 of the Listing Agreement, is appended to the Annual Report. MANAGEMENT DISCUSSION AND ANALYSIS: Management Discussion and Analysis Report for the year under review as required under Clause 49 of the Listing Agreement is presented in a separate section forming part of the Annual Report. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE :- During the period under review, your company doesn't received any such kind of order from the regulator or Courts or Tribunals DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:- Your Company has an effective internal control and risk-mitigation system, which are constantly assessed and strengthened with new/revised standards operating procedures. The Company's internal control system is commensurate to the size, scale and complexities of its Operations. DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES:- During the period under review, your Company doesn't have any Subsidiary, Associates and Joint Venture. PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENT:- During the period under review, your Company doesn't have any Subsidiary, Associates and Joint Venture STATUTORY AUDITORS M/s. N.K Jalan & Co, Chartered Accountants, Statutory Auditors of the Company hold office up to 35th Annual General Meeting and are eligible for re-appointment. The Company has received a letter from them to the effect that they are willing to continue as Statutory Auditors and if re-appointed, their re-appointmentwould be within the limits prescribed under Section 139 of the Companies Act, 2013 and they are not disqualified from being appointed as Auditors. AUDIT COMMITTEE:- During the year, in accordance with the Companies Act, 2013, the Board re-constituted some of its Committees. There are currently Three Committees on our Board which are as follows: 1. Audit Committee 2. Stakeholders' Relationship Committee 3. Nomination and remuneration Committee Details of all the aforementioned committees along with their charters, Composition and meetings held during the year, are provided in the Report on Corporate Governance . REVIEW OF AUDITOR'S REPORT Your Directors are pleased to inform you that the Statutory Auditors of the Company have not made any adverse or qualified remarks in their audit report. SECRETARIALAUDIT REPORT Pursuant to the provisions of Section 204 of the Companies Act, 2013, the Secretarial Audit Report received from M/s. Mayur More & Associates, Practicing Company Secretaries, is appended as Annexure - II and forms part of this report. STATUTORY COMPLIANCE: The Board and the Compliance Officer have ensured compliances of the SEBI regulations and provisions of the Listing Agreement. Compliance certificates are obtained and the Board is informed of the same. EXTRACT OF THE ANNUAL RETURN:- As required pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of annual return in MGT 9 as a part of this Annual Report is forming part of this Annual Report. CORPORATE SOCIAL RESPONSIBILITY (CSR):- During the year under review, provision of Corporate Social Responsibility (CSR) Rule has not applicable to your company. DIRECTORS' RESPONSIBILITY STATEMENT: The Directors' Responsibility Statement referred to in clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, shall state that— (a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; (b) 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) the directors had 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) the directors had prepared the annual accounts on a going concern basis; and (e) the directors, in the case of a listed company, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. (f) 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. VIGIL MECHANISM:- In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.cniglobalbiz.com under investors/policy documents/Vigil Mechanism Policy link. RISK MANAGEMENT POLICY A statement indicating development and implementation of a risk management policy for the Company including identification therein of elements of risk, if any, this in the opinion of the Board may threaten the existence of the company. REMUNERATION POLICY The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, senior Management and their remuneration. CODE OF CONDUCT The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the company. The code laid down by the Board is known as "code of business conduct" which forms an Appendix to the Code. The Code has been posted on the Company's website www.cniglobalbiz.com . PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186:- During the period under review, your company doesn't have any transaction relating to loans, guarantee or investments under section 186 PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES: During the period under review, your company doesn't have Contract or arrangement referred to in subsection (1) of section 188 ofthe Companies Act, 2013 including certain arms length transactions CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO Since the Company is engaged in the service industry, the Company does not consume substantial energy. It is the policy of the management to keep abreast of technological developments in the field in which the company is operating and to ensure that the Company uses the most suitable technology. During the year, the Company had earned Rs. 22,901/- (US $ 379.67) in the form of Royalty for sale of research reports. There is no outgoing in the form of foreign exchange. This does not include payments received from overseas partners and customer directly in Indian rupees. The report in the prescribed format is given Annexure-I MANAGERIAL REMUNERATION:- A) Details of the ratio of the remuneration of each director to the median employee's remuneration and other details as required pursuant to Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. During the period under review, not applicable to your company B) Details of the every employee of the Company as required pursuant to 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 During the period under review, No employee (s) fall under Rule 5(2) the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 C) Any director who is in receipt of any commission from the company and who is a Managing Director or Whole-time Director of the Company shall receive any remuneration or commission from any Holding Company or Subsidiary Company of such Company subject to its disclosure by the Company in the Board's Report. During the period under review, No Director (s) of the Company except Mr. Kishor P. Ostwal, Managing Director and Mrs. Sangita Kishor Ostwal, Whole Time Director of the Company drawing remuneration LISTING WITH STOCK EXCHANGES The Company confirms that it has paid the Annual Listing Fees for the year 2015-16 to BSE Limited where the Company's shares are listed. ACKNOWLEDGEMENTS Your Directors take this opportunity to thank its channel partners, all employees, analysts, economists, company secretary, registrar, depository, exchange authorities and bankers who were instrumental in improving the operations of the company. For and on behalf of Board sd/- Kishor P. Ostwal Managing Director sd/- Mayur Shantilal Doshi Director Place: Mumbai Date: 22nd August, 2015 |