Dear Members,
The Board of Directors (the Board) is pleased to present the
38th Annual Report of the Company along with the audited standalone and consolidated
financial statements for the financial year ended March 31,2023.
Financial Performance
The Company's standalone and consolidated financial performance for
the year ended March 31,2023 is summarised below.
(' in Crore)
Particulars |
Consolidated |
Standalone |
|
FY 2022-23 |
FY 2021-22 |
FY 2022-23 |
FY 2021-22 |
Gross income |
3,343.07 |
3,763.28 |
488.56 |
619.63 |
Profit
before depreciation, amortisation expense, finance costs and tax expenses (EBITDA) |
2,172.99 |
2,467.55 |
329.45 |
433.35 |
Less:
Depreciation and amortisation expense |
41.87 |
37.78 |
10.03 |
10.69 |
Finance
costs |
1,178.51 |
1,081.73 |
6.13 |
6.76 |
Profit
before tax |
952.61 |
1,348.04 |
313.29 |
415.90 |
Current tax |
243.54 |
415.46 |
40.15 |
77.50 |
Deferred tax |
0.61 |
(60.24) |
1.29 |
10.62 |
Tax
adjustments of earlier years (net) |
(0.30) |
0.45 |
(1.22) |
- |
Net Profit
after tax but before share in profit of associate |
708.76 |
992.37 |
273.07 |
327.78 |
Add: Share
in profit of associate |
0.23 |
0.02 |
- |
- |
Net Profit
after tax and share in profit of associate |
708.99 |
992.39 |
273.07 |
327.78 |
Other
Comprehensive Income |
10.58 |
4.27 |
(0.13) |
0.08 |
Total
Comprehensive Income |
719.57 |
996.66 |
272.94 |
327.86 |
Net Profit
Attributable to |
|
|
|
|
Owners of
the Company |
597.29 |
773.16 |
- |
- |
Non-Controlling
Interests |
111.70 |
219.23 |
- |
- |
Total
Comprehensive Income Attributable to |
|
|
|
|
Owners of
the Company |
607.91 |
777.50 |
- |
- |
Non-Controlling
Interests |
111.66 |
219.16 |
- |
- |
For the detailed analysis on financial and business performance of the
Company, please refer to the Management Discussion and Analysis Report forming part of
this Report.
Appropriations
The following appropriations have been made from the available profits of
the Company for the financial year ended March 31,2023.
(' in Crore)
Particulars |
Consolidated |
Standalone |
|
FY 2022-23 |
FY2021-22 |
FY 2022-23 |
FY 2021-22 |
Net Profit |
597.29 |
773.16 |
273.07 |
327.78 |
Add/(less):
Other Comprehensive Income |
(0.37) |
0.68 |
(0.13) |
0.08 |
Add: Balance
profit brought forward from previous year |
3,897.87 |
3,400.28 |
1,316.81 |
1,084.29 |
Profit
available for appropriations |
4,494.79 |
4,174.12 |
1,589.75 |
1,412.15 |
Less:
Appropriations |
|
|
|
|
Final
Dividend pertaining to the previous year paid during the year |
109.75 |
47.64 |
109.75 |
47.64 |
Interim
Dividend paid during the year |
85.93 |
47.70 |
85.93 |
47.70 |
Transfer to
Statutory reserve - I |
136.15 |
86.37 |
- |
- |
Transfer to
Statutory reserve - II |
5.85 |
0.87 |
- |
- |
Transfer to
Impairment reserve |
19.09 |
93.67 |
- |
- |
Surplus
carried to balance sheet |
4,138.02 |
3,897.87 |
1,394.07 |
1,316.81 |
The standalone and consolidated financial statements for the financial
year ended March 31, 2023 have been prepared in accordance with Section 133 of the
Companies Act, 2013 (the Act) read with the rules made thereunder and in
accordance with the Indian Accounting Standards (Ind AS).
Key highlights of Consolidated Financial Performance
> Gross income decreased by 11.2% to ' 3,343.07 Crore as compared to '
3,763.28 Crore in the financial year 2021-22;
> Profit before tax for the year decreased by 29.3% to ' 952.61 Crore
as compared to ' 1,348.04 Crore in the financial year 2021-22;
> Profit after tax (post non-controlling interest) for the year
decreased by 22.7% to ' 597.29 Crore as compared to ' 773.16 Crore in the financial year
2021-22; and
> The lower income and corresponding decrease in the profit after tax
(post non-controlling interest) for the year is primarily attributable to significant
decline in the performance of Alternative and Distressed Credit Business and Asset
Management, Wealth Management & Securities Business (Platform AWS) segment during the
year.
The consolidated financials reflect the cumulative performance of the
Company together with its various subsidiaries, associate company, partnership firm and
association of persons.
Key highlights of Standalone Financial Performance
> Gross income reported by the Company was ' 488.56 Crore for the year
ended March 31, 2023 as against ' 619.63 Crore in the previous year, registering a
decrease of 21.2%;
> Net profit of the Company was ' 273.07 Crore for the year ended March
31, 2023 as compared to the net profit of ' 327.78 Crore in the previous year, registering
a decrease of 16.7%; and
> The lower income and corresponding decrease in the net profit is
attributable to decrease in the fee income from ' 349.01 Crore in the previous year to '
193.99 Crore
in the year under review due to lower deal closures in investment banking
business. The said decrease was partially off-set by increase in dividend income from
subsidiaries which stood at ' 140.22 Crore in the year under review as compared to ' 46.14
Crore in the previous year.
The standalone and consolidated financial statements, together with the
relevant documents and audited financial statements for each of its subsidiaries, pursuant
to Section 136 of the Act, are available on the website of the Company at
https://imfi.com/investor-relation/financial-results.html.
General Reserve
During the financial year, there was no amount proposed to be transferred
to the general reserve on a standalone basis.
Scheme of Arrangement
During the year, a Scheme of Arrangement was filed with the National
Company Law Tribunal (NCLT) for demerger of the undertaking (the
Scheme) comprising Private Wealth and Portfolio Management Services (the
PMS) along with the investment in JM Financial Institutional Securities
Limited (which houses the institutional equities business) from its wholly owned
subsidiary, JM Financial Services Limited to the Company. The Scheme also comprises merger
of JM Financial Capital Limited, which is a wholly owned subsidiary of JM Financial
Services Limited, into JM Financial Services Limited. The Company has received the NCLT
order approving the Scheme on April 20, 2023 with the appointed date April 1, 2023. The
Scheme shall become effective upon filing of certified copy of the NCLT order with
Registrar of Companies (the ROC).
Once the Scheme becomes effective, the following changes shall take place:
- JM Financial Capital Limited will cease to be a step- down subsidiary of
the Company consequent upon its merger with JM Financial Services Limited;
- JM Financial Institutional Securities Limited will become a direct
wholly owned subsidiary of the Company; and
- the Private Wealth and PMS divisions shall become part of the Company
and be classified under the Investment Bank segment from the Platform AWS segment.
Dividend
The Board at its meeting held on May 9, 2023, recommended payment of the
final dividend of ' 0.90 per equity share of the face value of ' 1/- each (90% of face
value) for the financial year 2022-23. The payment of the final dividend is subiect to the
approval of the members at the ensuing Annual General Meeting (the AGM) of the
Company.
The Board at its meeting held on November 14, 2022, had also declared an
interim dividend of ' 0.90 per equity share of the face value of ' 1/- each (90% of face
value).
The total dividend for the financial year 2022-23, including the proposed
final dividend, amounts to ' 1.80 per equity share of the face value of ' 1/- each (180%
of face value). The final dividend (if approved by the members) along with the interim
dividend would involve a total outflow of ' 171.86 Crore as compared to outflow of '
157.45 Crore in the previous financial year. The dividend payout ratio works out to 28.77%
of the consolidated net profit for the year which is in accordance with the Dividend
Distribution Policy of the Company.
The amount of final dividend, on its declaration, will be paid to those
members:
a. whose names appear in the statement of beneficial ownership furnished
by National Securities Depository Limited and Central Depository Services (India) Limited
at the close of the business hours on Friday, May 19, 2023 in respect of shares held by
them in dematerialised form; and
b. whose names appear in the register of members at the close of business
hours on Friday, May 19, 2023 in respect of shares held by them in physical form.
In view of the changes made under the Income Tax Act, 1961, by the Finance
Act, 2020, dividends paid or distributed by the Company shall be taxable in the hands of
the recipients. The Company shall, accordingly, make the payment of the final dividend
after deduction of tax at source, as applicable.
The Dividend Distribution Policy of the Company, in terms of Regulation
43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (the SEBI Listing Regulations) is available on
the website of the Company at https://jmfi.com/ investor-relations/Policv for Dividend
Distribution.pdf.
Share Capital
During the year under review, the Company issued and allotted 7,48,270
equity shares to its eligible employees under the Company's Employees' Stock
Option Scheme - Series 8 to Series 13. As a result, the issued, subscribed and paid-up
equity share capital of the Company increased from ' 95,40,55,533 (comprising 95,40,55,533
equity shares of the face value of ' 1/- each) to ' 95,48,03,803 (comprising 95,48,03,803
equity shares of the face value of '1/- each). The equity shares issued under the
Employees' Stock Option Scheme rank pari-passu with the existing equity shares of the
Company.
Employees' Stock Option Scheme
During the year under review, the Company granted 11,90,779 stock options
to the eligible employees of the Company and its subsidiaries under the Company's
Employees' Stock Option Scheme (the ESOP Scheme) under Series 14, 15 and
16.
The ESOP Scheme is in compliance with the Securities and Exchange Board of
India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 (the SEBI
SBEB Regulations) and SEBI Circulars, issued from time to time, in this regard. A
certificate from the Secretarial Auditors of the Company, confirming that the Scheme has
been implemented in accordance with the SEBI SBEB Regulations, would be placed at the
ensuing AGM for inspection by the members through electronic means.
The disclosure of the ESOP Scheme, in compliance with the SEBI SBEB
Regulations, is set out in Annexure A and also uploaded on the Company's website at
https://imfi.com/ annual-report. Additionally, the relevant disclosures in terms of Ind AS
102 relating to share based payment, forms part of note 31 of the notes to the standalone
financial statements and note 44 of the notes to the consolidated financial statements of
the Company.
The Nomination and Remuneration committee (the NRC) of the
Board, at its meeting held on April 25, 2023, has granted an aggregate of 99,999 stock
options to the eligible employees of Company's subsidiary as per the ESOP Scheme
under Series 17.
Subsidiaries, Associate, Partnership Firm and Awards and Recognition
Association of Persons
The Company has following subsidiaries (including step down subsidiaries),
associate company, partnership firm and association of persons.
Subsidiary Companies (including step down subsidiaries)
1. JM Financial Institutional Securities Limited
2. JM Financial Services Limited
3. JM Financial Capital Limited
4. JM Financial Commtrade Limited
5. JM Financial Overseas Holdings Private Limited (Mauritius)
6. JM Financial Singapore Pte. Ltd. (Singapore)
7. JM Financial Securities, Inc. (United States of America)
8. Infinite India Investment Management Limited
9. JM Financial Properties and Holdings Limited
10. CR Retail Malls (India) Limited
11. JM Financial Products Limited
12. JM Financial Credit Solutions Limited
13. JM Financial Home Loans Limited
14. JM Financial Asset Reconstruction Company Limited
15. JM Financial Asset Management Limited Associate
JM Financial Trustee Company Private Limited
Partnership Firm
Astute Investments
Association of Persons
ARB Maestro
A report on the performance and financial position of each of the
subsidiaries and associate company is included in the consolidated financial statements
and their contribution to the overall performance of the Company is provided in Form AOC-1
which forms part of this Annual Report.
The Company's policy for determining material subsidiary is available
on its website at https://imfi.com/investor-relations/ Policy on Material
Subsidiaries.pdf.
The Asset
Triple A Country Awards for Sustainable Finance 2022 |
- JM
Financial Limited awarded for the Best Corporate and Institutional Adviser, India. |
(February 2023) |
- JM Financial
Limited awarded for the Best Equity Adviser, India. |
BSE Awards,
2022 (October 2022) |
The Bondskart
platform has been recognised by BSE Limited as the Best Performer in Retail Trading in
Corporate Bonds - Fintech Platforms. |
|
JM Financial
Services Limited has been recognised by BSE Limited amongst: |
|
- Top 5
Performers in Primary Market Segment (Equity - Members); |
|
- Top 5
Performers in Primary Market Segment (UPI Bids - Members); |
|
- Top 5
Performers in Primary Market Segment (Debt - Members); and |
|
- Best
Performers in Institutional Segment - Domestic. |
The Great Place
to Work Institute. India's Great MidSizes Workplaces (June 2022) |
JM Financial
Home Loans Limited recognised third time in a row among India's Top 50 Great
Mid-Sized Workplaces 2022'. |
Certifications
Great Place to
Work- Certified
(February 2023 - February 2024) |
JM
Financial Group has been accredited as Great Place to Work- CertifiedTM by the Great Place
to Work Institute for the below five participating entities for the period February 2023 -
February 2024. |
|
- JM
Financial Limited (Institutional Securities Businesses); |
|
- JM
Financial Services Limited; |
|
- JM
Financial Products Limited (Dwello); |
|
- JM
Financial Home Loans Limited; and |
|
- JM
Financial Asset Management Limited. |
Directors and Key Managerial Personnel
As on March 31,2023, the Board of the Company comprises ten (10) Directors
viz., two (2) executive directors, two (2) nonexecutive directors and six (6) independent
directors including two (2) women independent directors.
Appointment of Non-Executive Independent Director
During the year under review, the members of the Company at its meeting
held on August 2, 2022, had approved the appointment of Mr. Sumit Bose (DIN: 03340616) as
an independent director for a period of five (5) years with effect from May 24, 2022 to
May 23, 2027, basis the recommendation made by the NRC and the Board.
Retirement by Rotation
In accordance with the applicable provisions of Section 152 of the Act,
Mr. Vishal Kampani (DIN: 00009079), a non-executive director of the Company, being longest
in office since his last appointment, retires by rotation at the forthcoming AGM of the
Company. Being eligible, Mr. Kampani has offered himself for re-appointment as a director.
A resolution seeking his re-appointment along with the brief particulars
as required under the Secretarial Standard on General Meetings issued by the Institute of
Company Secretaries of India and Regulation 36 of the SEBI Listing Regulations forms part
of the Notice convening the 38th AGM of the Company.
None of the Directors is disqualified from being appointed as
Director', pursuant to Section 164 of the Act or under any other applicable
laws. The Company has obtained a certificate from Makarand M Joshi & Co., Company
Secretaries, that none of the directors on the Board of the Company has been debarred or
disqualified from being appointed or continuing as director of companies by the Securities
and Exchange Board of India (the SEBI)/Ministry of Corporate Affairs (the
MCA) or any such statutory authorities as on March 31, 2023. A copy of the
said certificate is forming part of Corporate Governance Report, which forms part of this
Report.
Cessation of Independent Directors
During the year under review, Mr. E A Kshirsagar (DIN: 00121824), Dr.
Vijay Kelkar (DIN: 00011991),
Mr. Paul Zuckerman (DIN: 00112255) and Mr. Keki Dadiseth (DIN: 00052165)
ceased to be the independent directors of the Company with effect from close of business
hours on July 2, 2022 upon completion of their second term pursuant
to Section 149(11) of the Act. With this, they also ceased to be
chairmen/members of the respective committees of the Board on which they were serving as
such.
The Board acknowledges the immense benefit derived by the Company from the
expertise and valuable guidance of the above directors and places on record its deep
appreciation for the thoroughness, dedication and commitment shown by them during their
stint as independent directors of the Company.
Change in Key Managerial Personnel
Ms. Dimple Mehta (Membership No. F12560) has been appointed as the Company
Secretary & Compliance Officer (for SEBI Listing Regulations) of the Company with
effect from April 1, 2023 and the Key Managerial Personnel (the KMP) within
the meaning of Section 203 of the Act. Mr. Prashant Choksi ceased to be the KMP upon he
relinquishing his executive role on surpassing his superannuation age with effect from the
close of business hours on March 31, 2023. The Board places on record its appreciation for
flawless work/ role played by Mr. Choksi during his association with the Company as such,
including his swiftness in responding to the queries/requirements of the Board Members,
past and present.
Other than above, there are no changes in the KMP of the Company. Mr. Atul
Mehra, Mr. Adi Patel, Joint Managing Directors and Mr. Manish Sheth, Chief Financial
Officer continue to be the KMPs within the meaning of Section 2(51) read with Section
203(1) of the Act.
Declaration by Independent Directors
The independent directors of the Company, pursuant to the provisions of
Section 149 of the Act and SEBI Listing Regulations, have submitted their declaration
confirming that each of them meets the criteria of independence as prescribed under the
Act read with rules made thereunder and the SEBI Listing Regulations and that they
continue to comply with the Code of Conduct laid down under Schedule IV to the Act. They
have also confirmed that they are not aware of any circumstance or situation which exists
or may be reasonably anticipated that could impair or impact their ability to discharge
their duties independently. Further, in terms of Section 150 of the Act read with Rule 6
of the Companies (Appointment and Qualification of Directors) Rules, 2014, the independent
directors of the Company have confirmed that they have registered themselves with the
databank maintained by the Indian Institute of Corporate Affairs.
Accordingly, based on the said declarations and after reviewing and
verifying its veracity, the Board is of the opinion that the independent directors are
persons of integrity, possess relevant expertise, experience, proficiency, fulfil the
conditions of independence specified in the Act and SEBI Listing Regulations and are
independent of the management of the Company.
There has been no change in the circumstances affecting their status as
independent directors of the Company. During the financial year 2022-23, the independent
directors had no pecuniary relationships or transactions with the Company, except as
disclosed in the Corporate Governance Report which forms part of this Report.
The Company has adopted the Code of Conduct for its directors and senior
management personnel (the Code of Conduct) in accordance with applicable
provisions of the Act and the SEBI Listing Regulations. On an annual basis, all the Board
Members and senior management personnel have affirmed compliance with the Code of Conduct.
Board Meetings
During the year under review, seven (7) meetings of the Board were held.
The maximum interval between any two meetings did not exceed 120 days, as prescribed under
the Act and the SEBI Listing Regulations. Detailed update on the Board, its composition,
governance of committees, number of meetings held during the financial year 2022-23 and
attendance of the Directors thereat, is provided in the Corporate Governance Report, which
forms part of this Report.
Policies on Appointment of Directors and their Remuneration
The Board values the significance of diversity and firmly believes that
diversity of gender, thought, experience and knowledge leads to sharper and balanced
decision-making. The Company has an eminent, high-performing and diverse board comprising
20% Women Directors. In terms of the applicable provisions of Section 178(3) of the Act
and Regulation 19(4) of the SEBI Listing Regulations, the Company has adopted the policies
on Selection and Appointment of Directors' and Performance Evaluation and
Remuneration of the Directors'. Both these policies are available on the website of
the Company at https://imfi.com/investor-relations/ Policy on Selection and Appointment of
Directors.pdf and https://imfi.com/investor-relations/Policy on Performance Evaluation and
Remuneration of the Directors.pdf.
The salient features of the policy on Performance Evaluation and
Remuneration of the Directors along with the details of
remuneration and other matters have been disclosed at length in the
Corporate Governance Report which forms part of this Report.
Evaluation of Board of Directors
Pursuant to the applicable provisions of the Act and the SEBI Listing
Regulations, the Board has carried out an annual evaluation of its own performance, the
Board committees and individual directors. The evaluation was based on the criteria and
questionnaire framed by the Company in accordance with its Policy on performance
evaluation and remuneration of the Directors, which is available on the website of the
Company and the Guidance Note on Board Evaluation issued by the SEBI vide its Circular
dated January 5, 2017. The questionnaires were circulated online through the secured
application and feedback received from the directors was discussed and reviewed by the NRC
and the Board at their respective meetings.
The independent directors of the Company met separately at their meeting
held on March 24, 2023, without the attendance of non-independent directors and members of
the management. Based on the feedback received through performance evaluation
questionnaires, the independent directors reviewed the following.
a) Performance of non-independent directors i.e., ioint managing
directors, non-executive vice chairman of the Company and the Board as a whole;
b) Performance of the various committees of the Board;
c) Performance of the chairman of the Board/Company; and
d) Assessed the quality, quantity and timeliness of flow of information
between the Company's management and the Board.
The independent directors expressed their satisfaction on the performance
of the non-independent directors of the Company and the Board as a whole, for the
financial year 2022-23 on the overall functioning of the Board committees.
The evaluation process endorsed the Board Members' confidence in the
ethical standards of the Company, the cohesiveness that exists amongst them, the two-way
candid communication between the Board and the management and the openness of the
management in sharing strategic information to enable the Board Members to discharge their
responsibilities effectively.
As an outcome of this exercise, the Board was of the view that it has
optimum mix of executive, non-executive and independent directors and that the Board and
its Committees work to its optimum levels and functions with independence, integrity and
professionalism for the long-term benefits of all the stakeholders. The Board noted that
Joint Managing Directors were discharging their duties admirably and the Chairman has
demonstrated exemplary leadership qualities in handling the board matters and has been
regarded as the sagacious leader who commanded well deserved respect.
There have been no material observations or suggestions, consequent to
such evaluation/review.
Board Committees
In compliance with the statutory requirements, the Board has following
Committees:
1. Audit Committee;
2. Nomination and Remuneration Committee;
3. Corporate Social Responsibility Committee;
4. Stakeholders' Relationship Committee;
5. Risk Management Committee; and
6. Allotment Committee
Detailed note on the composition of the Board and its committees,
including its terms of reference and meetings held are provided in the Corporate
Governance Report. The composition and terms of reference of the Committees of the Board
of the Company is in line with the provisions of the Act and the SEBI Listing Regulations.
Directors' Responsibility Statement
Pursuant to Section 134(3)(c) read with Section 134(5) of the Act with
respect to Directors' Responsibility Statement, the directors hereby confirm that:
a) in the preparation of the annual accounts, the applicable accounting
standards have been followed and that no material departure has been made in following the
same;
b) appropriate accounting policies have been selected and applied
consistently and iudgements and estimates made 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 of the Company for that period;
c) proper and sufficient care for maintenance of adequate accounting
records in accordance with the provisions of
the Act have been taken for safeguarding the assets of the Company and for
preventing and detecting frauds and other irregularities;
d) the annual accounts have been prepared on a going concern basis;
e) internal financial controls to be followed by the Company had been laid
down and such internal financial controls are adequate and operating effectively; and
f) proper systems have been devised to ensure compliance with the
provisions of all applicable laws and that such systems are adequate and operating
effectively.
Statutory Auditors
During the year under review, the members of the Company had approved the
appointment of B S R & Co. LLP, Chartered Accountants (Firm registration no.
101248W/W-100022), Mumbai as the Statutory Auditors of the Company, for a period of five
(5) consecutive years from the conclusion of the 37th AGM until the conclusion of the 42nd
AGM to be held in the financial year 2027-28.
Auditor's Report
The Statutory Auditors have issued their unmodified opinion, both on
standalone and consolidated financial statements, for the financial year ended March 31,
2023. They have not highlighted any qualifications, reservations, adverse remarks or
disclaimers. The Statutory Auditors have not reported any incidents of fraud to the Audit
Committee of the Board during the financial year 2022-23. The notes to the accounts
referred to in the auditor's report are self-explanatory and therefore do not call
for any further explanation and comments.
Secretarial Audit
The Board of the Company, on the recommendation made by the Audit
committee, had appointed Makarand M. Joshi & Co., Company Secretaries, as the
Secretarial Auditors (the MMJC) to conduct an audit of the secretarial records
for the financial year 2022-23.
The secretarial audit report as issued by MMJC for the financial year
ended March 31, 2023, is appended to this Report as Annexure B, which is self-explanatory.
The Secretarial Auditors have not reported any fraud under Section 143(12)
of the Act.
Further, in compliance with Regulation 24A of the SEBI Listing
Regulations, the Annual Secretarial Compliance Report issued by MMJB & Associates LLP,
was submitted to the stock exchanges within the statutory timelines.
Secretarial audit report of material unlisted Indian subsidiary
A copy of the secretarial audit report for the financial year 2022-23
issued to JM Financial Services Limited, a material unlisted subsidiary of the Company is
appended to this Report marked as Annexure B1.
Secretarial Standards
The Company has complied with the applicable provisions of Secretarial
Standards issued by the Institute of Company Secretaries of India and notified by the MCA.
Internal Auditors
During the year under review, CNK & Associates LLP., Chartered
Accountants, were appointed as the Internal Auditors of the Company in accordance with the
applicable provisions of the Act.
Corporate Social Responsibility
The Corporate Social Responsibility Committee (the CSR
committee) has been established by the Board in accordance with Section 135 of the
Act and details of its composition, terms of reference and particulars of meetings held
during the year are stated in the Corporate Governance Report which forms part of this
Report.
As earmarked for the financial year under review, the Company has spent '
0.99 Crore as the CSR expenditure towards the CSR Project viz., Shri Vardhman Nidaan Seva.
The aforesaid CSR Project of the Company was in accordance with the
activities specified under Schedule VII to the Act and a brief overview on the same is
available on the website of the Company at https://imfi.com/giving-csr/proiects.
The CSR policy outlines the activities that can be undertaken or supported
by the Company within the applicable provisions of the Act and alignment of such
activities as per the sustainable development goals principles. Apart from the composition
requirements of the CSR committee, the CSR policy, inter alia, lays down the criteria for
selection of projects & areas, annual allocation, modalities of
execution/implementation of activities, monitoring mechanism of CSR activities/projects
including the formulation of annual action plan. The CSR policy of the Company is
available on the website of the Company at https://imfi.com/investor-relations/CSR
Policy.pdf.
Pursuant to the amendment to the Companies (Corporate Social
Responsibility Policy) Rules, 2014 (the CSR Rules), the Chief Financial
Officer of the Company has certified that the funds disbursed basis the annual action plan
for the
financial year 2022-23 have been utilised for the purpose and in the
manner as approved by the Board.
The details of CSR activities as required under Rule 8 of the CSR Rules in
the prescribed format is appended to this Report as Annexure C.
Risk Management
Risk management is an integral part of the Company's strategy for
achieving the long-term goals. The Company and its subsidiaries are exposed to various
risks which include liquidity risk, interest rate risk, market risk, credit risk,
technology risk, operational risk, regulatory and compliance risk, reputational risk,
business continuity risk, risk emanating from cyber security, legal risk, competition
risk, among others. A comprehensive risk management policy has been formulated by the
Company apart from the processes which are in place to identify, assess, evaluate, manage
and mitigate the risks that are encountered during the conduct of business activities,
which may pose significant loss or threat to the Company.
The Risk Management committee of the Company as established by the Board
has been entrusted with the responsibility of reviewing the risk management process in the
Company. The committee also reviews the cyber security function, assess various risks and
ensures that the risks are brought within acceptable limits. The Audit committee has an
additional oversight in the area of financial risks and controls.
Details about development and implementation of risk management policy
have been covered at length in the Management Discussion and Analysis Report which forms
part of this Report.
Internal financial control system and its adequacy
The Company has adequate internal financial control system over financial
reporting which ensures that all transactions are authorised, recorded, and reported
correctly in a timely manner. The Board has adopted accounting policies which are in
accordance with Section 133 of the Act read with the Companies (Indian Accounting
Standards) Rules, 2015.
The internal financial control system of the Company is supplemented with
internal audits, regular reviews by the management and checks by external auditors. It
provides reasonable assurance in respect of financial and operational information,
compliance with applicable statutes, safeguarding of assets of the Company, prevention and
detection of frauds, accuracy and completeness of accounting records and also ensuring
compliance with the Company's policies.
The Statutory Auditors and the Internal Auditors of the Company also
provide their confirmation that the internal financial control framework is operating
effectively.
The Company on a regular basis tracks all amendments to Accounting
Standards and makes changes to the underlying systems, processes and financial controls to
ensure adherence to the same. During the year, no material or serious observations have
been highlighted for inefficiency or inadequacy of such controls. The details of adequacy
of internal controls are given at length in the Management Discussion and Analysis Report
which forms part of this Report.
Deposits
There were no outstanding deposits within the meaning of Sections 73 and
74 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014, as amended, at
the end of financial year 2022-23 or the previous financial year. The Company did not
accept any deposits during the financial year 2022-23.
Material changes and commitments affecting the financial position of the
Company
There have been no material changes and commitments affecting the
financial position of the Company which have occurred between the end of the financial
year to which the financial statements relate and the date of this Report.
Change in nature of business
During the financial year 2022-23, there has been no change in the nature
of the Company's business except that as mentioned earlier, upon receipt of all
approvals from the concerned authorities and pursuant to the Scheme of Arrangement, the
Private Wealth and PMS divisions of JM Financial Services Limited, a wholly owned
subsidiary of the Company, shall be classified under the Investment Bank segment of the
Company.
Significant and material orders
During the financial year under review, there were no significant/
material orders passed by the regulators or courts or tribunals impacting the going
concern status of the Company and its operations.
Report on Corporate Governance
Pursuant to Regulation 34 read with Schedule V to the SEBI Listing
Regulations, a report on Corporate Governance for the financial year 2022-23 along with
the certificate from the Secretarial Auditors of the Company confirming the
compliance with the regulations of Corporate Governance under the SEBI
Listing Regulations is annexed and forms part of this Report.
Management Discussion and Analysis Report
Management Discussion and Analysis Report as stipulated under Regulation
34 of the SEBI Listing Regulations is presented in a separate section forming part of this
Report, which gives an update, inter-alia on the following matters.
Industry structure and developments;
Segment-wise overview of business performance;
Financial Overview;
Risk management;
Internal control systems and their adequacy;
Corporate Social Responsibility and Philanthropy; and
Human Resources.
Business Responsibility and Sustainability Report (BRSR)
Pursuant to Regulation 34 of the SEBI Listing Regulations, detailed BRSR
report, in the format as prescribed by SEBI, describing various initiatives taken by the
Company towards the Environmental, Social and Governance aspects forms part of this
Report.
Particulars of employees and related information
The ratio of remuneration of each Director to the median employees'
remuneration as per Section 197(12) of the Act read with Rule 5(1) of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, (the
Rules) as amended, is disclosed in Annexure D, appended to this Report.
In terms of Section 136(1) of the Act, the Annual Report is being sent to
the members, excluding the information regarding employee remuneration as required
pursuant to Rule 5(2) and Rule 5(3) of the said Rules. Any member desirous of obtaining
such information may write to the Company Secretary at ecommunicationQjmfi.com and the
same will be furnished on such request.
Particulars of loans, guarantees or investments
The details, if any, of loans, guarantees and investments falling under
the provisions of Section 186 of the Act read with the Companies (Meetings of Board and
its Powers) Rules, 2014 are given in note 37 of notes to the standalone financial
statements of the Company.
Credit rating
Details of all the credit ratings obtained by the Company is mentioned in
the General Shareholders' Information which forms a part of the Corporate Governance
Report.
Investor Education and Protection Fund (IEPF)
Details of unclaimed dividends and equity shares which are transferred to
the Investor Education and Protection Fund and Investor Education and Protection Fund
authority are mentioned in the General Shareholders' Information which forms a part
of the Corporate Governance Report.
Particulars of contracts or arrangements with related parties
In line with the requirements of the Act and the SEBI Listing Regulations,
the Company has formulated a Policy on dealing with Related Party Transactions'
and the said policy is uploaded on the website of the Company at https://jmfl.com/
investor-relation/Disclosures-of-related-party-transactions. html.
All the related party transactions were placed before the Audit committee
for its review on a quarterly basis. An omnibus approval of the Audit committee had been
obtained for the related party transactions which were repetitive in nature. Further, as
per the applicable provisions of the SEBI Listing Regulations, necessary approvals of the
members of the Company were also sought for the material related party transactions
proposed to be entered with the related parties.
Pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the
Companies (Accounts) Rules, 2014, there are no related party transactions that are
required to be reported under Section 188(1) of the Act, as prescribed in Form AOC-2.
The related party transactions as required under Ind AS - 24 are reported
in note 37 of notes to the standalone financial statements and note 41 of notes to the
consolidated financial statements of the Company.
The Company in terms of Regulation 23 of the SEBI Listing Regulations,
submits the disclosures of related party transactions on a consolidated basis to the stock
exchanges within the stipulated time. The said disclosures are available on the website of
the Company at https://jmfl.com/investor- relation/overview.html.
Annual Return
Pursuant to Sections 92(3) and 134(3)(a) of the Act, the Annual Return for
the financial year 2022-23, is available on the website of the Company at
https://imfl.com/investor-relation/ agm-egm.html.
Conservation of energy, technology absorption, foreign exchange earnings
and outgo
The operations of the Company are not energy intensive nor does they
require adoption of specific technology and hence information in terms of Section
134(3)(m) of the Act read with the Companies (Accounts) Rules, 2014 is not applicable to
the Company. The Company has, however, implemented various energy conservation measures
across all its functions which are highlighted in the BRSR forming part of this Report.
During the financial year 2022-23, the total foreign exchange earned by
the Company was ' 12.05 Crore and the total foreign exchange outgo was ' 0.79 Crore.
The details of the transactions in foreign exchange are provided in notes
40 and 41 of notes to the standalone financial statements.
Vigil Mechanism/Whistle Blower Policy
The Company encourages an open and transparent system of working and
dealing amongst its stakeholders and accordingly, has framed a robust vigil mechanism in
the form of Whistle Blower policy. This policy enables its directors and employees of the
Company or any other person who avails the mechanism framed under this policy to report
concerns about unethical or improper practices or alleged wrongful conduct, actual or
suspected fraud etc., without any fear of discrimination or victimisation of any kind.
This policy protects such directors and employees from unfair or preiudicial treatment by
anyone within the Company. It also provides direct access to the chairman of the Audit
committee. Details of vigil mechanism/whistle blower policy are included in the Corporate
Governance Report, forming part of this Report. The policy is available on the website of
the Company at https://imfl.com/investor-relations/Whistle Blower Policy. pdf.
In order to enhance the knowledge amongst the employees about the Whistle
Blower policy, an awareness programme was undertaken by the Company and an annual
affirmation in this regard was obtained from the employees.
During the financial year 2022-23, no complaints under this mechanism have
been reported.
Maintenance of cost records
The maintenance of cost records as specified under Section 148 of the Act
is not applicable to the Company.
Policy for prevention, prohibition and redressal of sexual harassment of
women at workplace
In compliance with the requirement of the Sexual Harassment of Women at
Workplace (Prevention, Prohibition & Redressal) Act, 2013 and rules made thereunder,
the Company has a policy in place and has constituted Internal Complaints Committee (the
ICC) to deal with complaints relating to sexual harassment at workplace. All
employees, permanent, contractual, temporary and trainees are covered under this policy. A
quarterly report on the complaints, if any, is placed before the Board for its review.
During the financial year 2022-23, no complaints were received from any of
the employees, under this policy.
Certificate from the Joint Managing Directors and Chief Financial Officer
The certificate received from Mr. Atul Mehra, Mr. Adi Patel, the Joint
Managing Directors and Mr. Manish Sheth, the Chief Financial Officer with respect to the
financial statements and other matters as required under Part B of Schedule II to the SEBI
Listing Regulations forms part of Corporate Governance Report, which forms part of this
Report.
Other Disclosures
The Company has not issued equity shares with differential rights as to
dividend, voting or otherwise.
The Company has not issued any sweat equity shares during the year.
No proceedings are made or pending under the Insolvency and Bankruptcy
Code, 2016 and there is no instance of onetime settlement with any Bank or Financial
Institution.
Acknowledgements
The Board of Directors take this opportunity to place on record its
sincere thanks to SEBI, RBI, MCA, National Housing Bank, Real Estate Regulatory Authority,
Stock Exchanges including Commodity Exchanges, customers, vendors, investors, banks,
financial institutions, business associates, shareholders and all other stakeholders for
their continued co-operation and support. The Directors also recognise the support and
co-operation extended by the Government of India, State Governments, Overseas Regulatory
Authorities and their agencies.
The Board of Directors wish to place on record their appreciation to
employees at all levels for their dedication and commitment.
For and on behalf of the Board of Directors
|
Nimesh Kampani |
Place: Mumbai |
Chairman |
Date: May 9,
2023 |
DIN:
00009071 |
|