a. The Company has issued 815 (Nil) 10.5% Secured Unlisted Redeemable Non Convertible debentures of Rs.1 Lakh each which is repayable in 3 years and is secured by corporate guarantee given by LKP Finance Limited (related party). The first interest payment is due on 31 March, 2025.
b. Overdraft facility from Bank of India Limited of Rs.Nil (Rs.700 Lakhs) [Sanctioned Rs.1,016.00 Lakhs] is secured by hypothecation of receivables of T+3 days with 50% margin and first pari passu charge on book debts of the Company, both present and future. The overdraft facility is further secured by a collateral security of 50% in form of TDR, equitable mortgage of property and personal guarantee from directors. The loan is repayable on demand and carries interest @ 11.90%. The loan has been repaid during the year and charge has been satisfied with the Registrar of Companies.
c. Fund based overdraft facility from Axis Bank Limited of Rs. 1.18 Lakhs (Rs. Nil) [Sanctioned Rs. 2,000.00 Lakhs] is secured by pledge of fixed deposits with bank, also Fund based facility of Rs.4.87 Lakhs (Rs.Nil) [Sanctioned 1,000.00 Lakhs] is secured by hypothecation of receivable of T+6 days with 50% margin and corporate guarantee by subsidiary Company of Rs.500.00 lakhs (Rs.Nil) and pledge of mutual fund from current investment Rs.171.00 lakhs and for intraday facilities of Rs. Nil [Sanctioned Rs.1,500 Lakhs] with minimum 50% security in the form of pledge/lein/mortgage of property.
d. Fund based overdraft facility from Federal Bank Limited of Rs. Nil (Rs. 28.42 Lakhs) [Sanctioned Rs. 500.00 Lakhs] is secured by pledge of fixed deposits with bank and carries interest at weighted average underlying Fixed deposits plus 100 bps.
e. Fund based overdraft facility from Yes Bank Limited of Rs. Nil (Rs. Nil) [Sanctioned Rs.Nil (Rs. 94.50 Lakhs)] is secured by pledge of fixed deposits with bank. The loan has been repaid during the year. The charge is neither created nor satisfied with Registrar of Companies.
f. Non - Fund based facility from Axis Bank Limited sanctioned of Rs. 4,000 Lakhs [Sanctioned Rs. 4,000 Lakhs] is secured by pledge of fixed deposits and personal guarantee from directors.
g. Non - Fund based facility from ICICI Bank Limited sanctioned of Rs. 2,000 Lakhs [Sanctioned Rs. 2,000 Lakhs] is secured by pledge of term deposits and personal guarantee from directors.
h. Fund based overdraft facility from ICICI Bank Limited of Rs. Nil (Rs. Nil) [Sanctioned Rs. 1,000.00 Lakhs] is secured by approved bonds and government securities.
i. Fund based overdraft facility from South Indian Bank Limited of Rs. Nil [Sanctioned Rs. 45.00 Lakhs] is secured by lien of fixed deposits with bank.
j. The details of quarterly returns filled by the company against security provided is as under
b) Terms/rights attached to equity shares
The Company has issued only one class of equity shares having a par value of Rs.2 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. The final dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.
In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
f) Employees Stock Option Scheme (ESOP)
The Company had instituted an Employee Stock Option Plan (“ESOP - 2017 or “the Scheme”) as approved by Board of Directors and Shareholders of the Company. Under the scheme, 38,85,000 Stock Options were granted (Phase I: 37,00,000 & Phase II: 1,85,000) at a price of Rs. 7/- per option to the employees of the Company. As per the scheme, 33%, 33% and 34% of the total grant vested at the end of every year from the original grant dates. The options vested were exercisable at any time within a period of one year from the date
of vesting and the equity shares arising on exercise of options not subject to any lock in. The scheme has been discontinued during the 2021. Further, the Members of the Company had modified and amended the above ESOP - 2017 and subsequently the Company has granted 4,67,000 options and 11,75,580 options under phase III and phase IV respectively to its employees under the modified LKPS ESOP - 2017, from the lapsed/balance options at a price of Rs. 7/- per option. As per the grant, 50% of the option vested after the expiry of 12 months and 50% of the option vested after the expiry of 24 months from the original date of grant. The options are exercisable at any time within a period of three years from the date of vesting and the equity shares arising on exercise of options were not be subject to any lock in. There are no Options outstanding under Phase III as on 31 March, 2024. 2,79,175 Options were exercised during the year under Phase IV and 70,185 Options are outstanding as at 31 March, 2024.
Further, the Company has granted 3,50,000 options under Phase V & 1,50,000 options under Phase VI to its employees under the modified LKPS ESOP - 2017, at a price of Rs. 12/- per option. As per the grant, 50% of the option shall vest after the expiry of 12 months and 50% of the option shall vest after the expiry of 24 months from the original date of grant. The options vested would be exercisable at any time within a period of three years from the date of vesting and the equity shares arising on exercise of options shall not be subject to any lock in. 12,500 Options were exercised during the year and 25,000 options lapsed under Phase V. As at 31 March, 2024, there are 3,12,500 Options outstanding under Phase V and 1,50,000 Option outstanding under Phase VI.
The applicable tax rate is the standard effective corporate income tax rate in India. The tax rate is 29.12% for the year ended 31 March 2024.
Deferred tax assets and liabilities are offset where the Company has a legally enforceable right to do so. For analysis of the deferred tax balances (after offset) for financial reporting purposes refer note 9.
The Company does not have any temporary differences in respect of unutilized tax losses as at 31 March 2024.
(d ) The Company does not have any unrecorded transactions that have been surrenderred or disclosed as income during the year in the tax assessment under Income Tax Act, 1961.
31 Leases-short term
For short-term leases (lease term of 12 months or less) and leases of low-value assets , the Company has opted to recognise a lease expense on a straight-line basis as permitted by Ind AS 116. This expense is presented within ‘other expenses' forming part of the Financial Statements. Lease rentals of Rs.45.91 lakhs (2023- Rs.53.56 Lakhs) pertaining to short term leases and low value asset has been charged to statement of profit and loss.
(ii) Litigation
The Company has filed various cases for recovery of dues and suits are pending in various courts. The Company has engaged advocates to protect the interest of the Company and expects favourable decision.
(iii) Capital commitments
There are no capital commitments in current year as well as previous year.
(iv) No proceedings are initiated or pending against the Company for holding benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988).
34 Segment Informations
Disclosure under Indian Accounting Standard 108 - ‘Operating Segments' is not given as, in the opinion of the management, the entire business activity falls under one segment, viz. ,primarily engaged in equity,currency and commodity broking and its related activities. The Company conducts its business only in one Geographical Segment, viz., India.
The Company has compiled the relevent information from its suppliers about their coverage under the Mico, Small and Medium Enterperises Development Act, 2006 (MSMED Act).
37 Financial Instruments
i) Financial risk management objective and policies
The Company's principal financial liabilities, comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the Company's operations. The Company's principal financial assets include investments, loans, trade receivables, other receivables, and cash and bank balances that derive directly from its operations.
The Company is exposed to market risk, credit risk and liquidity risk. The Company's management oversees the management of these risks.
a) Market risk:
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, foreign currency risk and other price risk such as equity price risk. Financial instruments affected by market risk include loans and borrowings, deposits, other financial instruments.
1) Interest rate risk:
Interest rate risk can be either fair value interest rate risk or cash flow interest rate risk. Fair value interest rate risk is the risk of changes in fair value of fixed interest bearing investments because of fluctuations in the interest rates. Cash flow interest rate risk is the risk that future cash flows of floating interest bearing investments will vary because of fluctuations in interest rates.
2) Foreign currency risk:
The Company enters into transactions in currency other than its functional currency and is therefore exposed to foreign currency risk. The Company analyses currency risk as to which balances outstanding in currency other than the functional currency of that Company. The management has taken a position not to hedge this currency risk.
The Company undertakes transactions denominated in foreign currencies, consequently, exposures to exchange rate fluctuations arise. Exchange rate exposures are not hedged considering the insignificant impact and period involved on such exposure.
The Company enters into transactions in currency other than its functional currency and is therefore exposed to foreign currency risk. The Company analysis currency risk as to which balances outstanding in currency other than the functional currency of that Company. The management has taken a position not to hedge this currency risk.
The Company undertakes transactions denominated in foreign currencies, consequently, exposures to exchange rate fluctuations arise. Exchange rate exposures are not hedged considering the insignificant impact and period involved on such exposure.
The Company does not have any foreign currency risk. Hence no sensitivity analysis is required
3) Credit Risk:
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company's receivables from customers, deposits and loans given, investments and balances at bank.
The Company measures the expected credit loss of trade receivables based on historical trend, industry practices and the business environment in which the entity operates. Expected Credit Loss is based on actual credit loss experienced and past trends based on the historical data.
b) Liquidity Risk:
Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The Company's principal source of liquidity are cash and cash equivalents and the cash flow i.e. generated from operations. The Company consistently generated strong cash flows from operations which together with the available cash and cash equivalents and current investment provides adequate liquidity in short terms as well in the long term.
ii) Capital Management
For the purpose of Company's capital management, capital includes issued capital and other equity reserves. The primary objective of the Company's Capital Management is to maximize shareholder value. The Company manages its capital structure and makes adjustments in the light of changes in economic environment and the requirements of the financial covenants.
The management assessed that cash and cash equivalents and bank balances, trade receivables, other financial assets, certain investments, trade payables and other current liabilities approximate their fair value largely due to the short-term maturities of these instruments. Difference between carrying amount and fair value of bank deposits, other financial assets, other financial liabilities and borrowings subsequently measured at amortised cost is not significant in each of the year presented.
38 Fair Value Hierarchy :
-Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
-Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. prices) or indirectly (i.e. derived from prices).
-Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
If the inputs used to measure the fair value of an asset or a liability fall into different levels of a fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.
The Following table provides the fair value measurement hierarchy of the Company's assets and liabilities.
Quantitative disclosures of fair value measurement hierarchy for assets and liabilities as at 31 March 2024
Financial assets not measured at fair value includes cash and cash equivalents, trade receivables, loans and other financial assets. These are financial assets whose carrying amounts approximate fair value, due to their short-term nature
Additionally, financial liabilities such as trade payables and other financial liabilities are not measured at FVTPL, whose carrying amounts approximate fair value, because of their short-term nature.
39 Gratuity and other post employment benefit plans
The disclosures of employee benefits as defined in the Ind AS 19 ’’Employee Benefits” are given below:
The gratuity plan is a funded plan and the Company makes contributions to recognised funds in India. The details of post retirement gratuity plan are as follows:
(a) The estimate of future salary increases considered in the actuarial valuation takes into account the rate of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.
(b) The Company provided for gratuity for employees in India as per the payment of Gratuity Act, 1972. employees who are in continues service for period of 5 years are eligible for gratuity. The gratuity plan is funded and the Company make contribution to recognised funds in India.
44 There are no unclaimed dividend for a period of more than seven years. Further, there are no amounts due and outstanding to be credited to Investor's Education and Protection Fund as on 31 March 2024
45 The Company, has no long-term contracts including derivative contracts having material foreseeable losses as at 31 March 2024
46 Disclosure as required by schedule V (A) (2) of the SEBI (Listing Obligation and Disclosure Requirements)
The Company has not given any Loans and advances in the nature of loans to firms/companies in which director is interested .
47 The Company is not required to spend corporate social responsibility (CSR) for the financial year ending 31 March, 2024. During the financial year 31 March, 2023, the Company has spent Rs.16.60 Lakhs as per the provision of section 135 of the Companies Act, 2013.
49 Information required under Section 186(4) of the Companies Act, 2013
a) There are no loans given, guarantee given and securities provided during the year except loan to staff
b) There are no investments made other than disclosed in Note 6.
50 The Board of Directors of the Company had decided to sell an Immovable property acquired pursuant to settlement for Rs. 672.04 Lakhs. The Company has classified the land as per Ind AS 105 “ Non-current Assets Held for Sale and Discontinued Operations “. During the finacial year the company has passed members resolution to sale the land to the promoter of the Company viz Mr.Mahendra V Doshi at arms length price based on the valuation of independent valuer.
51 During the previous year ended 31 March 2023 the Company has allotted:
On 25 July 2022, post approval from the regulators, the Company has allotted 59,88,023 warrants to Promoter and Promoter Group Entities at an issue price of Rs.16.70/- per warrant aggregating up to Rs. 1,000.00 Lakhs. Allotted Warrants were convertible into one equity share of face value of Rs. 2/- each within a period of 18 months from the date of allotment. The Company has alloted during the year ended 31 March 2024, 29,94,012 equity shares (2023: 29,94,011 equity shares) against these warrants. Expenses amounting to Rs. 5.00 lakhs related to issue of warrants are charged directly to other equity during the previous year.
54 The Company has not traded or invested in crypto currency or Virtual currency during the year
55 During the year the Company has not advanced or loaned or invested funds (either borrowed funds or share premium or any other sources or kind of funds) to any other person or entity including foreign entities (intermediaries) with the understanding (whether recorded in writing or otherwise) that the intermediary shall (i) directly or indirectly lend or invest in other person or entities identified in any manner whatsoever by or on behalf of Company (ultimate beneficiaries) or (ii) provide any guarantee, security or the like to or behalf of the ultimate beneficiaries.
56 The Company has not received any fund from any person(s) or entity(ies) including foreign entities (funding party) with the understanding (ehether recorded in writing or otherwise) that the Company shall (i) directly or indirectly lender invest in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries) or (ii) provide any guarantee, security or the to or behalf of the (ultimate beneficiaries) or (iii) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.
57 Additional regulatory information required under (WB) (xvi) of Division III of Schedule III amendment, disclosure of ratios, is not applicable to the Company as it is in broking business and not an NBFC registered under Section 45-IA of Reserve Bank of India Act, 1934.
58 Prior Year Comparatives
Previous year's figures have been regrouped / reclassified/rearranged wherever necessary to correspond with the current year's classifications / disclosures. Figures in brackets pertain to previous year
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