MANAGEMENT DISCUSSION AND ANALYSIS

ECONOMIC SCENARIO AND OUTLOOK

India's GDP growth for FY15 was recorded at 7.3% YoY as against the growth rate of 6.9% YoY recorded in FY14. CPI inflation has decelerated from the recent peak of 11.2% YoY registered in Nov-13 to 4.9% YoY in Apr-15 largely led by lower food prices (46% weight in CPI) : Flls invested USD18.1b in FY15, higher then USD13.7b in FY14. After five years of outflows, domestic MFs recorded an inflow of USD6.6b. Today fiis own 23.9% of the Nifty stock ownership and as much as 48% of the free float in the Nifty stocks.

The financial year 2014-15 saw the Nifty Index deliver 27% returns closing at 8,491 on 31st March 2015 as against 6704 levels a year ago. This was primarily led by increased optimism on the ability of the newly elected NDA government to fast track the reforms process in India and implement development policies at a faster pace.

Global Foreign institutional investor (fii) flows into Indian markets however, were limited during the year due to the super normal outperformance of the Chinese equity markets. The benchmark Shanghai Composite Index was up 84% during the same period as against 27% returns by the Nifty.

FUTURE PROSPECTS

The future prospects for the India equity markets look extremely promising in the current backdrop of events in the Global financial markets. The euphoria in other emerging markets is likely to settle down soon as earnings have failed to catch up with the spectacular rise in the stock prices. Investors would be wary of deploying funds in developed markets as the US Federal Reserve considers hiking the US Fed Interest Rate anytime during the current financial year, Indian equity markets are looking attractively valued after the recent correction and are trading at near historical average PE multiples. The management is confident of a strong year ahead for the Indian Equity markets. This will augur well for the performance of your company, which largely depends on the direction of the stock market.

BUSINESS RISK MANAGEMENT

Although the company has long been following the principle of risk minimization as is the norm in every industry, it has now become a compulsion. Therefore, in accordance with clause 49 of the listing agreement the Board members were informed about risk assessment and minimization procedures after which the Board formally adopted steps for framing, implementing and monitoring the risk management plan for the company.

The main objective of this policy is to ensure sustainable business growth with stability and to promote a pro-active approach in reporting, evaluating and resolving risks associated with the business. In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, in order to guide decisions on risk related issues.

In today's challenging and competitive environment, strategies for mitigating inherent risks in accomplishing the growth plans of the Company are imperative. The common risks inter alia are: Regulations, competition, Business risk, Investments, retention of talent and expansion of facilities. Business risk, inter-alia, further includes financial risk, political risk, fidelity risk, legal risk. As a matter of policy, these risks are assessed and steps as appropriate are taken to mitigate the same.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The Company has adequate system of internal control to safeguard and protect from loss, unauthorized use or disposition of its assets.

All the transactions are properly authorized, recorded and reported to the Management. The Company is following all the applicable Accounting Standards for properly maintaining the books of accounts and reporting financial statements.

All the investments related activities are done under the direct supervision of the Chairman of our company. Considering the size and nature of business the company has appointed an Internal Auditor for the company. The Company now proposes to appoint an Internal Auditor for the financial year 2015-16, to ensure proper and adequate systems and procedures commensurate with its size and nature of its business.

VIGIL MECHANISM / WHISTLE BLOWER  POLICY

In order to ensure that the activities of the Company and its employees are conducted in a fair and transparent manner by adoption of highest standards of professionalism, honesty, integrity and ethical behavior, the company proposes to adopt a vigil mechanism policy during the financial year 2015-16.

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. The Remuneration Policy is stated in the Corporate Governance Report.

DIRECTORS' AND COMMITTEE MEETINGS

During the year Eight Board Meetings and one independent directors' meeting was held. The Details of which are given in Corporate Governance Report. The provisions of Companies Act, 2013 and listing agreement were adhered to while considering the time gap between two meetings.

AUDIT COMMITTEE

The company is having an audit committee comprising of the following directors:

Shri Iyer Vishwanath - Chairman - Non Executive & Independent Director

Shri S.Hariharan - Member - Non Executive & Independent Director

Shri Sundar Iyer - Member - Executive Director

NOMINATION AND REMUNERATION COMMITTEE

The company is having a Nomination and Remuneration Committee comprising of the following directors

Shri Iyer Vishwanath - Chairman - Non Executive & Independent Director

Shri S.Hariharan - Member - Non Executive & Independent Director

Shri Sundar Iyer - Member - Executive Director

Stakeholders/Investors Grievance and Share Transfer Committee

The company is having a Stakeholders/ Investors Grievance and Share Transfer Committee comprising of the following directors:

Mr. S. Hariharan, Chairman of the Committee.

Mr. Iyer Vishwanath, Member  

Mr. Sundar Iyer, Member.

RELATED PARTY TRANSACTIONS

There were no contracts or arrangements entered into by the company in accordance with provisions of section 188 of the Companies Act, 2013. However, there were material related party transactions in terms of clause 49 of the listing agreement. All material related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business.

There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

All Related Party Transactions are placed before the Audit Committee as also the Board for approval.

The policy on Related Party Transactions as approved by the Board is uploaded on the Company's website. None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company.

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.

CORPORATE GOVERNANCE

As per Clause 49 of the Listing Agreement with the Stock Exchanges, a separate section on corporate governance practices followed by the Company, together with a certificate from the Company's Secretarial Auditor confirming compliance forms an integral part of this Report.

Conservation of Energy

The Company had taken steps to conserve use of energy in its office, consequent to which energy consumption has been minimized. No additional Proposals/ Investments were made to conserve energy. Since the company has not carried on industrial activities, disclosures regarding impact of measures on cost of production of goods, total energy consumption, etc., are not applicable