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Directors Report of Keynote Corporate Services Ltd.

Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting their 22nd Annual Report together with the Audited Accounts of your Company for the year ended 31st March, 2015.

(Rs. In lacs)

Details Year Ended Year Ended 31-03-2015 31-03-2014

Total Income 583.68 942.12

Gross Operating Profit 130.52 319.10

Depreciation 37.39 34.06

Exceptional Items 14.12 -

Profit Before Tax 79.01 285.04

Provision for :

Current Tax 12.25 61.57

Deferred Tax Liability/(Assets) 14.67 16.93

Profit After Tax 52.09 206.53

Add/Less : Excess Provision/Short - (0.26) Provision

Profit/(Loss) brought forward from 1,597.61 1,494.07 Previous year

Surplus available for appropriations 1,649.70 1,700.35

Proposed Dividend 70.18 70.18

Tax on Dividend 11.93 11.93

Transferred to General Reserve - 20.63

Balance carried forward 1,567.59 1,597.61

DIVIDEND

Your directors are pleased to recommend a dividend of Rs. 1/- per Equity Share of face value of Rs. 10/- each (i.e.10%) for the year ended 31st March, 2015. The dividend will be paid subject to approval of members at the 22nd Annual General Meeting (AGM).

OPERATIONS:

The financial year 2014-15 saw major change in political scenario in the country. The new government with a majority assumed charge at the centre. The expectations of markets including financial markets increased due to stable government with a general sense of optimism & enthusiasm. Though the capital market showed signs of improvement, the primary market conditions did not improve drastically. However, few IPOs were launched in the capital market and resource raising in the form of equity through capital market issuances have improved. Your company also has been able to get a few mandates for IPOs, Rights Issues & other Advisory services in respect of preferential allotment, private equity placement etc. During financial year, your company filed the draft offer documents in respect of 2 Public issues and 3 Rights issues besides handling other assignments. However, many of the transactions could not be completed due to adverse primary market conditions which has resulted in sharp fall in income from operations. Company was able to complete certain assignments in 'Corporate Finance' area such as advising companies on raising debt from Banks, corporate advisory services, valuation services etc. Company continued to provide advisory services in respect of ESOP transactions. There has been a strain on profitability. During the financial year, company could post total income of Rs. 583.68 lacs with a profit after tax of Rs. 52.09 lacs as against income of Rs. 942.12 lacs and profit after tax of Rs. 206.53 lacs for the previous financial year 31st March, 2014. The company has to maintain the team of professionals which is essential to cope up with future possibilities of improvement in business environment. Company is hopeful of overall improvement in the capital market and would be able to post reasonable good income levels in years to come.

OPERATIONS OF SUBSIDIARY

Presently your company has two 100% subsidiaries namely Keynote Capitals Limited (KCL) an integrated broking house and Keynote Fincorp Ltd. (KFIN) a NBFC. KCL is a member of BSE & NSE as well as Depository Participant of Central Depository Services India Limited. KCL has a subsidiary namely Keynote Commodities Ltd. which is member of Multi Commodity Exchange of India (MCX).

During the last financial year subsidiary restructured the operations by exiting from retail business via process of realignment of business. KCL focuses on institutional trading & other trading activities of large and high net worth investors. KCL posted a total income of Rs. 618.41 lacs for 31st March, 2015 as compared to Rs. 919.22 lacs for 31st March, 2014. Profit After Tax stood at Rs. 79.17 lacs as compared to Rs. 81.62 lacs for the previous year.

SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS

Keynote Capitals Limited (KCL) and Keynote Fincorp Limited (KFIN) are our wholly owned subsidiary companies. Presently Keynote Capitals Limited has one wholly owned subsidiary namely Keynote Commodities Limited. Pursuant to the provisions of Section 129(3) of the Act, a statement containing salient features of the financial statements of the Company's subsidiaries in Form AOC-1 is attached to the financial statements of the Company. Pursuant to the provisions of Section 136 of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited accounts in respect of subsidiaries are available on the website of the Company.

The financial statement of the subsidiary Companies are kept for inspection by the shareholders at the Registered Office of the Company. The company shall provide free of cost, the copy of the financial statement of its subsidiary companies to the shareholders upon their request. The statements are also available on the website of the Company i.e. www.kevnoteindia.net

As stipulated by Clause 32 of the listing agreement with the stock exchanges, the consolidated financial statement have been prepared by the Company in accordance with the applicable Accounting standards. The audited consolidated financial statements together with Auditors Report form part of the Annual Report.

The company had formulated a policy for determining 'material' subsidiaries and such policy disclosed the company's website http://www.keynoteindia.net/document-hosting/financial results/ Keynote Material%20Subsidiarv%20Policv.pdf

TRANSFER TO RESERVES

During the year your Company has not transferred any amount to general reserve.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

As required under Clause 49 of the Listing Agreements with Stock Exchanges, the Management Discussion and Analysis Report is enclosed as a part of this report.

CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION

The Companies Act, 2013 and the listing agreement with the Stock exchanges require compliances with specified Corporate Governance practices. These practices have been fully implemented and a certificate from the Practicing Company Secretary as well as a detailed report on Corporate Governance approved by the Board of Directors of the Company is set out in the annual report. The Company is regularly complying with Corporate Governance practices and also uploading the information under Corporate Filing & Dissemination System (corpfiling). Your Company has also been enlisted in the new SEBI compliant redressal system (SCORES) enabling the investors to register their complaint if any for speedy redressal.

LISTING WITH STOCK EXCHANGES

The Equity Shares of the Company continued to be listed and traded on the BSE Limited (BSE) and National Stock Exchange of India Ltd. (NSE). The scrip code number of the Equity Shares of the Company on BSE is 512597 and on NSE is KEYCORPSER. The Company has paid upto date listing fees to both the stock exchanges.

DEMATERIALIZATION

The Equity Shares of the Company can be held in dematerialized form. The Company has signed the tripartite agreement with National Securities Depository Ltd., (NSDL) Central Depository Services (India) Ltd., (CDSL) and existing Registrar & Transfer Agent for dematerialization of existing holding of the shareholders. The International Securities Identification Number (ISIN), allotted to the Company is INE681C01015. The Equity Shares of the Company are listed and traded on BSE and NSE. On BSE the equity shares of the Company are traded in "B" segment. The Equity Shares of the Company are being traded in compulsory dematerialized mode. Presently 96.52% of equity capital of the company is in dematerialized mode.

PUBLIC DEPOSIT

Your Company has neither accepted nor renewed any deposit within the meaning of Section 73 and other applicable provisions, if any, of the Companies Act, 2013 and the necessary rules made there under during the year ended 31st March, 2015.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The particulars of loans, guarantees and investment have been disclosed in the notes to the financial statements.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is well defined. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board & to Managing Director. The Accounts Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and based on the report of internal audit the management undertakes corrective action in the respective areas and thereby strengthens the controls. Significant audit observations and recommendations if any, along with corrective actions thereon are required to be are presented to the Audit Committee of the Board. During this financial year no such observations have been made.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Your Company understands and values Corporate Social Responsibility (CSR) initiatives of the Government and have also noted the requirements of CSR activities in terms of Companies Act, 2013. The requirement of mandatory implementation of CSR activity is not applicable to your company due to inadequacy of profits in past three financial years.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO

(A) Conservation of energy:

Considering the nature of business activities carried out by the Company, your directors have nothing to report with regard to conservation of energy as required under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988.

(B) Technology absorption:

The management keeps itself abreast of the technological advancements in the industry and has adopted the state of the art transaction, billing and accounting systems and also risk management solutions.

(C) Foreign exchange earnings and Outgo:

a) The foreign exchange earnings Rs. 57.17 lacs (previous year Rs. 86.52 lacs).

b) The foreign exchange expenditure Rs. 2.20 lacs (previous year Rs. 16.42 lacs).

STATE OF AFFAIRS

During the year under review, your Company enjoyed cordial relationship with employees at all levels.

DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

(i) Changes in Directors and Key Managerial Personnel (KMP):

(a) At the Board meeting held on 10th February, 2015 your Company has appointed Shri Uday S. Patil, Whole-Time Director of the Company also as 'Chief Financial Officer (CFO)'

(b) Vide Circular Resolution dated 31st March, 2015 your Company has appointed Smt. Rinku Suchanti (DIN: 00012903) as an Additional Director of the Company to hold office upto the ensuring Annual General Meeting of the Company. Thus the Company is in compliance with the provision relating to having at-least one Woman Director on the Board in terms of requirement of Corporate Governance,

(c) Vide Circular Resolution dated 4th May, 2015 your Company has appointed Shri Shishir Dalal [DIN: 00007008] as an Additional Director of the Company in the category of Independent Director to hold office upto the ensuing Annual General Meeting of the Company and accepted resignation of Shri Sujal Shah (DIN: 00058019) as a Director of the Company and

(d) In accordance with the provision of Section 152(6)(a) of the Companies Act, 2013 and the Articles of Association of the Company, Shri B. Madhuprasad Director (DIN: 00004632) of the Company retires by rotation at the ensuing Annual General Meeting and being eligible, offers, himself for reappointment. Your Board recommends his re-appointment.

(ii) Appointment of Independent Director:

At the Annual General Meeting of the members of the Company held on 9th September, 2014, your Company appointed following persons as the Independent Directors of the Company:

Sr. Name of the Director DIN Designation No.

1. Shri Hitesh Shah 00061296 Independent Director

2. Shri Sujal Shah* 00058019 Independent Director

3. Shri Anish Malhotra 02034366 Independent Director

4. Shri Manish Desai 02925757 Independent Director



Sr. Name of the Director Date of Appointment as No. Independent Director

1. Shri Hitesh Shah 9th September, 2014

2. Shri Sujal Shah* 9th September, 2014

3. Shri Anish Malhotra 9th September, 2014

4. Shri Manish Desai 9th September, 2014

* During the period Shri Sujal Shah has resigned as an Independent Director of the Company w.e.f. 4th May, 2015. Shri Shishir Dalal has been appointed as an Independent Director from the said date.

DECLARATION OF INDEPENDENCE

Your Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under the provisions of Companies Act, 2013 read with the Schedules and Rules issued there under as well as Clause 49 of the Listing Agreement.

BOARD EVALUATION

The Board of directors has carried out an annual evaluation of its own performance, Board committees and individual directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by Securities and Exchange Board of India ("SEBI") under Clause 49 of the Listing Agreements ("Clause 49"). The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of the criteria such as the Board composition and structure, effectiveness of board processes, information and functioning, etc.

The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings, etc. The Board and the Nomination and Remuneration Committee ("NRC") reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc.

In a separate meeting of independent Directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of executive directors and non-executive directors. The same was discussed in the board meeting that followed the meeting of the independent Directors, at which the performance of the Board, its committees and individual directors was also discussed.

DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND PARTICULARS OF EMPLOYEES

In accordance with Section 178 and other applicable provisions if any, of the Companies Act, 2013 read with the Rules issued there under and Clause 49 of the Listing Agreement, the Board of Directors at their meeting held on 7th August, 2014 formulated the Nomination and Remuneration Policy of your Company on the recommendations of the Nomination and Remuneration Committee. The salient aspects covered in the Nomination and Remuneration Policy, covering the policy on appointment and remuneration of Directors and other matters have been outlined in the Corporate Governance Report which forms part of this Report.

The information required under Section 197 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Directors/ employees of your Company is set out in "Annexure [A]" to this Report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Companies Act, 2013, Directors of your Company hereby state and confirm that

(a) In the preparation of the annual accounts for the year ended 31st March, 2015, 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;

(e) 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; and

(f) They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

STATUTORY AUDITORS

M/s. Haribhakti & Co. LLP, Chartered Accountants, Mumbai Statutory Auditors of the company will retire at the ensuing Annual General Meeting. The Board of Directors proposes to appoint M/s. NMAH & Co., Chartered Accountants, Mumbai (Firm Registration No. 135966W) as a Statutory Auditors of the Company. Members are requested to consider appointment of M/s. NMAH & Co., Chartered Accountants, Mumbai as Staturoty Auditors of the Company at a remuneration to be decided by the Board of Directors.

Your Company has received written consent and a certificate stating that they satisfy the criteria provided under Section 141 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014 and that the appointment, if made, shall be in accordance with the applicable provisions of the Companies Act, 2013 and rules issued there under.

AUDITORS' REPORT

The Auditors have referred to certain routine matters in their report and the respective notes to the accounts are self-explanatory.

EXTRACT OF THE ANNUAL RETURN

Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rule, 2014, the Extract of Annual Return (Form No. MGT-9) as on the financial year ended on 31st March, 2015 is enclosed as "Annexure - [B]" to the Directors' Report.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company has appointed M/S Uma Lodha & Co., Practicing Company Secretary to conduct the Secretarial Audit of your Company. The Secretarial Audit Report is annexed herewith as "Annexure - [C|" to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS AND AUDIT COMMITTEES

Your Board of Directors has duly met four (4) times during the financial year i.e. on 27th May, 2014, 7th August, 2014, 11th November, 2014 and 10th February, 2015 in respect of which proper notices were given and the proceedings were properly recorded and signed in the Minute Book maintained for the purpose. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

The Audit Committee has duly met four (4) times during the financial year i.e. on 27th May, 2014, 7th August, 2014, 11th November, 2014 and 10th February, 2015 in respect of which proper notices were given and the proceedings were properly recorded and signed in the Minute Book maintained for the purpose.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

In pursuance 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 purpose of the "Whistleblower Policy" is to allow employees to raise concerns about unacceptable, improper or unethical practices being followed in the organization. They will be protected against any adverse action and/ or discrimination as a result of such a reporting, provided it is justified and made in good faith. The Chairman of the Audit Committee has been designated for the purpose of receiving and recording any complaints under this policy. The Vigil Mechanism Policy has been uploaded on the website of the Company at http:// www.keynoteindia.net/document-hosting/financial results/Kevnote Whistle%20Blower%20Policy.pdf

RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the company at large.

Transactions with related parties entered by the Company in the normal course of business are periodically placed before the Audit Committee for its omnibus approval and the particulars of contracts entered during the year as per Form AOC-2 is enclosed as "Annexure-D". The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act 2013, the Rules there under and the Listing Agreement. This Policy was considered and approved by the Board has been uploaded on the website of the Company at http://www.keynoteindia.net/document-hosting/financial results/ Keynote Policy%20on%20Related%20Partv%20Transactions.pdf

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 has been placed on the Company's website www.kevnoteindia.net

The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders. All the Board Members and the Senior Management personnel have confirmed compliance with the Code.

RISK MANAGEMENT

Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Clause 49 of the listing agreement, the Company has formulated risk management policy the same has been placed on the company website. http:// www.keynoteindia.net/document-hosting/financial results/Keynote Risk%20Management%20Policy.pdf At present the company has not identified any element of risk which may threaten the existence of the company.

PREVENTION OF INSIDER TRADING

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires pre-clearance for dealing in the Company's shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the Code. All the Directors and the designated employees have confirmed compliance with the Code.

SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATORS

There are no significant/material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of your Company and its operations in future.

General

a. Your Company has not issued equity shares with differential rights as to dividend, voting or otherwise; and

b. Your Company does not have any ESOP scheme for its employees/Directors.

ACKNOWLEDGMENT

We take this opportunity to express our deep sense of gratitude to Securities and Exchange Board of India (SEBI), BSE Limited (bSe), National Stock Exchange of India Limited (NSE), Registrar of Companies (ROC), National Securities Depository Limited (NSDL), Central Depository Services (India) Limited (CDSL), Association of Investment Bankers of India (AIBI), Link Intime India Pvt. Limited, M/s. Haribhakti & Co. LLP Statutory Auditors, M/s. R. B. Pandya & Co. Internal Auditors, our Clients, Bankers and other Government Agencies for their continued support.

By Order of the Board For Keynote Corporate Services Limited

Sd/- Vineet Suchanti Date: 10th August, 2015 Managing Director Place: Mumbai (DIN: 00004031)




Mar 31, 2014

Dear Shareholders,

The Directors have pleasure in presenting their 21st Annual Report together with the Audited Accounts of your Company for the year ended 31st March, 2014.

(Rs In lacs)

Details Year Ended Year Ended 31-03-2014 31-03-2013

Total Income 942.12 1,069.05

Gross Operating Profit 319.10 480.59

Depreciation 34.06 28.06

profit Before Tax 285.04 452.53

Provision for :

Current Tax 61.57 84.21

Deferred Tax Liability/(Assets) 16.93 29.10

profit After Tax 206.53 339.21

Add/Less : Excess Provision/Short Provision (0.26) 3.37

profit/(Loss) brought forward from Previous year 1,494.07 1,300.35

Surplus available for appropriations 1,700.35 1,642.93

Proposed Dividend 70.18 105.28

Tax on Dividend 11.93 17.89

Transferred to General Reserve 20.63 25.69

Balance carried forward 1,597.61 1,494.07



Dividend

Your directors are pleased to recommend a dividend of Rs 1.00 per Equity Share of face value of Rs 10/- each for the year ended 31st March, 2014. The dividend will be paid subject to approval of members at the 21st Annual General Meeting (AGM).

Operations

The fi rst half of financial year 2013-14 remained dull as far as capital markets are concerned. The BSE Sensex & NSE Nifty was at its lowest ebb in August-September 2013. With the announcement of general elections and certain other political developments the outlook towards Indian capital market changed dramatically with the hope of a stable Government. The secondary market conditions improved with renewed activity with interest by Foreign Institutional Investors followed by good demand from domestic investors. By the end of financial year secondary market showed defi nite indicators of improvement with large infl ows from foreign investors. Thus the hopes for general improvement of economic and capital market conditions revived by the end of fi nancial year.

However, as far as primary market conditions are concerned the activity of equity resource raising through new issuances remained abysmally low. The financial year witnessed one large offer for sale by a company and two Follow on Public Offers (FPOs) by Public Sector Undertakings (PSUs). The activity on SME segment was brisk with about 32 IPO issuances. Your company was able to successfully complete 2 IPOs on SME platform of NSE - EMERGE. The company could also successfully complete 2 Delisting Offers and a right issue during the financial year. Company has been focusing on select capital market and corporate fi nance transactions.

Your Company has been able to provide corporate advisory services to some of the large corporate groups consistently and has been able to maintain its level of operations. The Company posted a total income of Rs 942.12 lacs during the financial year with profit After Tax of Rs 206.53 lacs. The Company has been continuously striving to strengthen and maintain the team of professional with good execution capabilities across the Board. The overall contribution of the team has been on increase during the financial year. Though there has been a fall in income during the financial year as compared to last financial year company is hopeful that with improvement in general market conditions company will be able to generate good business and complete various transactions on hand. Company is hoping to move forward strategically by adding new clients and transactions in year to come.

Operations of Subsidiary

Presently your company has two 100% subsidiaries namely Keynote Capitals Limited (KCL) an integrated broking house and Keynote Fincorp Ltd. (KFIN) a NBFC. KCL is a member of BSE & NSE as well as Depository Participant of Central Depository Services India Limited. KCL has a subsidiary namely Keynote Commodities Ltd. which is member of Multi Commodity Exchange of India (MCX).

During the last financial year the subsidiary was able to restructure the operations by exiting from retail business via process of realignment of business. KCL posted a total income of Rs 919.22 lacs for 31st March, 2014 as compared toRs 2,215.66 lacs for 31st March, 2013. profit After Tax stood atRs 81.62 lacs as compared to Rs 98.35 lacs for the previous year.

Subsidiary Companies and Consolidated Financial Statements.

Keynote Capitals Limited (KCL) and Keynote Fincorp Limited (KFIN) are our wholly owned subsidiaries companies. Presently Keynote Capitals Limited has one wholly owned subsidiary namely Keynote Commodities Limited.

The Statement pursuant to Section 212 of the Companies Act, 1956, relating to Company''s subsidiary and step down subsidiaries is annexed to this Report.

The Audited Accounts of the aforesaid Companies along with the report of the Board of Directors and the Auditors Report thereon which are required to be attached with the Annual Report of the Company have not been attached as the Board of Directors have given consent not to attach the Annual Accounts of the Company''s subsidiary and step down subsidiaries with the Annual Accounts of the Company in accordance with the Ministry of Corporate Affairs, Government of India Circular No.2/2011 dated 8th February, 2011 under Section 212 of the Companies Act, 1956.

Tax Provisions

The Company has made adequate tax provisions under the provisions of Income Tax Act, 1961.

Listing

The Equity Shares of the Company continued to be listed and traded on the BSE Limited (BSE) and National Stock Exchange of India Ltd. (NSE). The scrip code number of the Equity Shares of the Company on BSE is 512597 and on NSE is KEYCORPSER. The Company has paid upto date listing fees to both the stock exchanges.

Dematerialization

The Equity Shares of the Company can be held in dematerialized form. The Company has signed the tripartite agreement with National Securities Depository Ltd., (NSDL) Central Depository Services (India) Ltd., (CDSL) and existing Registrar & Transfer Agent for dematerialization of existing holding of the shareholders.

The International Securities Identifi cation Number (ISIN), allotted to the Company is INE681C01015. The Equity Shares of the Company are listed and traded on BSE and NSE. On BSE the equity shares of the Company are traded in "B" segment. The Equity Shares of the Company are being traded in compulsory dematerialized mode. Presently 96.46% of equity capital of the company is in dematerialized mode.

Directors Responsibility Statement

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 217(2AA) of the Companies Act, 1956:

(a) that in the preparation of the Annual Accounts for the year ended March 31, 2014 the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

(b) that the Directors have 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 as at March 31, 2014 and of the profit of the Company for the year ended on that date;

(c) that the Directors have taken proper and suffi cient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

(d) the annual accounts have been prepared on a going concern basis.

Corporate Governance

The Companies Act, 1956 and the listing agreement with the Stock exchanges require compliances with specifi ed Corporate Governance practices. These practices have been fully implemented and a certifi cate from the Practicing Company Secretary as well as a detailed report on Corporate Governance approved by the Board of Directors of the Company is set out in the annual report. The Company is regularly complying with Corporate Governance practices and also uploading the information under Corporate Filing & Dissemination System (corpfi ling). Your Company has also been enlisted in the new SEBI compliant redressal system (SCORES) enabling the investors to register their complaint if any for speedy redressal.

Particulars of Employees

Your Directors acknowledge and appreciate the sincere efforts and effective services rendered by the committed employees and staff of the company.

During the year under review, there was no employee covered under the provision of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975.

Auditors Observations

The Auditors have referred to certain routine matters in their report and the respective notes to the accounts are self- explanatory.

Conservation of Energy, Technology absorption, Foreign Exchange Earning and outgo:

In view of the nature of activities of the Company, Rules 2A and 2B of the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 concerning conservation of energy and technology absorption respectively are not applicable to the Company.

During the year the Company has earned an Income of Rs 86.52 lacs in Foreign Exchange and has incurred an expenditure ofRs 16.42 lacs in Foreign Exchange.

Fixed Deposits

During the year ended 31st March, 2014 the Company has not accepted any deposits from the Public under Section 58A of the Companies Act, 1956.

Directors

In accordance with Section 152 and other applicable provisions of Companies Act, 2013, Shri Uday S. Patil (DIN : 00003978) Director retires by rotation and being eligible offers himself for re-appointment at the ensuing Annual General Meeting. Also as per the provisions of Companies Act, 2013, it is proposed to appoint Shri Hitesh Shah (DIN : 00061296), Shri Sujal Shah (DIN : 00058019), Shri Anish Malhotra (DIN : 02034366) and Shri Manish Desai (DIN : 02925757) as Independent Directors of the Company for a consecutive term of fi ve years from 21st Annual General Meeting.

Brief resumes of Directors, nature of their expertise in specifi c functional areas are annexed and forms part of this Report.

Based on the confi rmations received, none of the Directors are disqualifi ed for appointment under Section 274(1)(g) of the Companies Act, 1956 and Section 164(2) of Companies Act, 2013.

Statutory Auditors

The Auditors, M/s. Haribhakti & Co. LLP Chartered Accountants, Mumbai, hold offi ce until the conclusion of the ensuing Annual General Meeting and are recommended for re-appointment.

The Ministry of Corporate Affairs has notifi ed the provisions of Section 139 of the Companies Act, 2013 for appointment of Auditors, which is effective from April 1, 2014. Pursuant to Section 139(2) of the Companies Act, 2013 and the rules made thereunder, no listed company shall appoint or re-appoint a audit fi rm as auditor for more than two terms of fi ve consecutive years. Further the aforesaid appointment is subject to ratifi cation by the Members of the Company at every Annual General Meeting.

Pursuant to Section 139(2) of the Companies Act, 2013, the Audit Committee and Board of Directors of Company have recommended their appointment for a period of fi ve years i.e. from the conclusion of 21st Annual General Meeting, until conclusion of sixth Annual General Meeting to be held after this meeting, subject to ratifi cation at every Annual General Meeting. M/s. Haribhakti & Co. LLP Chartered Accountants have confi rmed that re-appointment, if made, will comply with the eligibility criteria in terms of Section 141(3) of the Companies Act, 2013.

Information under the sexual harassment of women at workplace (Prevention, prohibition and Redressal), Act, 2013.

In compliance with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, your Company has formed a Committee to look into such cases as and when they arise. During the period under review, no cases were fi led before the Committee.

Whistle Blower Policy

As per the provision of Section 177(9) of the Companies Act, 2013 the listed Company shall establish a vigil mechanism for directors and employees. The vigil mechanism shall also provide for adequate safeguards against victimization of persons who use such mechanism and make provision for direct access to the chairperson of the Audit Committee in appropriate or exceptional cases. Such mechanism has been disclosed by the Company on its website.

The purpose of the "Whistleblower Policy" is to allow employees to raise concerns about unacceptable, improper or unethical practices being followed in the organization. They will be protected against any adverse action and/or discrimination as a result of such a reporting, provided it is justifi ed and made in good faith. The Chairman of the Audit Committee has been designated for the purpose of receiving and recording any complaints under this policy.

Acknowledgment

We take this opportunity to express our deep sense of gratitude to Securities and Exchange Board of India (SEBI), BSE Limited (BSE), National Stock Exchange of India Limited (NSE), Registrar of Companies (ROC), National Securities Depository Limited (NSDL), Central Depository Services (India) Limited (CDSL), Association of Investment Bankers of India (AIBI), Link Intime India Pvt. Limited, M/s. Haribhakti & Co. LLP Statutory Auditors, M/s. K. K. Bhageria & Co. Internal Auditors, our Clients, Bankers and other Government Agencies for their continued support.

By Order of the Board For Keynote Corporate Services Limited

Sd/- Date: 7th August, 2014 Vineet Suchanti Place: Mumbai Managing Director


Mar 31, 2010

The Directors have pleasure in presenting their 17,th Annual Report together with the Audited Accounts of your Company for the year ended 31st March, 2010.

(Rs. in lacs)

Details Year Ended Year Ended 31-03-2010 31-03-2009

Total Income 1,011.00 1,125.11

Gross Operating Profit 559.46 629.69

Depreciation 11.71 11.41

Profit Before Tax 547.75 618.28

Provision for:

Current Tax 144.00 200.00

Deferred Tax Liability/(Assets) (0.07) 1.01

Fringe Benefit Tax - 5.55

Profit After Tax 403.82 411.72

Add/Less : Excess Provision/Short Provision 64.18 (10.09)

Profit/(Loss) brought forward from Previous year 479.46 159.93

Surplus available for appropriations 819.10 561.56

Proposed Dividend 105.00 70.18

Tax on Dividend 18.00 11.93

Transferred to General Reserve 20.19 -

Balance carried forward 675.75 479.45

Dividend

Your Board is pleased to recommend a dividend of Rs. 1.50/- per Equity Shares (i.e. 15%) on 70,18,339 fully paid- up Equity Shares of Rs. 10/- each for the financial year ended on 31st March, 2010.

Operations

The first half of the financial year 2009-10 continued to be sluggish in line with the global scenario. Your company was able to withstand the downturn effectively. Transactions and markets stated picking up in the second half and during the current financial year Keynote was actively involved in Book Running for 3 IPOs raising approximately Rs. 140 crores. In addition, the company also successfully managed a few Buy Back of shares and Tender Open Offers. The company, during the year, strengthened its Corporate Finance Team and its valuation desk with a view to be actively involved in raising funds for unlisted companies through Private Equity and being an Advisor to Mergers & Acquisitions transactions (M & A).

The Company has posted a total Income of Rs. 1,1011.00 lacs and a Profit After Tax of Rs. 403.82 lacs.

Operations of Subsidiaries

Keynote Capitals Limited (KCL), a 100% subsidiary and an integrated broking house having memberships of the Bombay Stock Exchange Ltd., (BSE) and National Stock Exchange of India Ltd., (NSE) has also posted ! consistent performance. KCL continues to focus on institutional and corporate broking business. KCL has also expanded its research and focuses on covering mid-cap companies as well as track the IPO market.

KCL is in the process of expanding its Retail operations with a focus on more active equity centres. It is j estimated that by the end of the next financial year, KCL will have over 10 full fledged branches offering retails clients the entire bouquet of equity trading, demat and research services. Your holding company, KCSL invested Rs. 625 lacs in KCL by way of equity to further strengthen the subsidiarys capitalization.

KCL posted a total Income of Rs. 1,004.88 lacs for 31/03/2010 as compared to Rs. 836.33 lacs in 31/03/2009. However, Profit After Tax stood at Rs. 186.50 lacs compared to Rs. 215.33 lacs for the previous year.

The corporate structure of the Group is as below :

Keynote Corporate Services Ltd.

SEBI Registered Category Merchant Banker

Wholly owned subsidiary

Keynote Capitals Ltd.

Member: BSE, NSE, NSE Derivative Depository Participant (DP)

Wholly owned subsidiaries

Keynote Commodities Ltd. Keynote Wealth Management Ltd. Arteries

Insurance

Broking Ltd.

Member: Multi Commodity Distributor of Financial Products Insurance Broking : Applied for Exchange (MCX) i.e. MFs, IPOs, Bonds, FDs etc.

Subsidiary Companies and Consolidated Financial Statements.

Keynote Capitals Limited (KCL) is a wholly owned subsidiary company. Keynote Capitals Limited has three i wholly owned subsidiaries namely (1) Keynote Commodities Limited (2) Keynote Wealth Management Limited (3) Arteries Insurance Broking Limited.

Pursuant to Section 212 of the Companies Act, 1956 the Company made an application to the Ministry of Corporate Affairs, Government of India, New Delhi and sought an exemption from attaching with the Balance Sheet of the company, the Accounts and other documents of each of the Subsidiary Companies of the company. The Ministry of Corporate Affairs, Government of India vide its letter No. 47/672/2010-CL-III dated 2nd August, 2010, has granted their approval under Section 212(8) of the Companies Act, 1956 for not attaching the Balance Sheet etc. of the aforesaid subsidiaries for the financial year ended 31st March, 2010. Accordingly provisions of Section 212 (1) of the Companies Act, 1956 in respect of these subsidiaries are not applicable. In compliance with the said approval the company has disclosed the information in respect of these subsidiaries as advised.

The Company undertakes that annual accounts of the subsidiary companies and the related detailed information will be made available to the holding and subsidiary companies investors seeking such information at any point of time. The annual accounts of the subsidiary companies are also kept for inspection by any investor in its registered office and that of the subsidiary companies concerned. The holding Company shall furnish a hard copy of details of accounts of subsidiaries to any shareholder on demand. The Company will put the details of the accounts of individual subsidiary companies on the website of the company.

As per Clause 32 of the Listing Agreement, the consolidated financial statements of the Company with its Subsidiaries form part of the Annual Report. The copies of the audited annual accounts of the Companys Subsidiaries and other related documents can also be sought by any member of the Company or its Subsidiaries on making a written request to the Company Secretary in this regard. The Annual Accounts of the Subsidiary Companies are also available for inspection by any investor at the Companys and/or the concerned Subsidiaries registered office.

Tax Provisions

The Company has made adequate tax provisions under the provisions of Income Tax Act, 1961.

Listing

The Equity Shares of the Company continue to be listed and traded on the BSE and NSE. The scrip code number of the equity shares of the Company on BSE is 512597 and on NSE is KEYCORPSER. The Company has paid up-to-date listing fees to both the exchanges.

Dematerialization

The equity shares of the Company can be held in dematerialized form. The Company has signed the tripartite agreement with National Securities Depository Ltd. Central Depository Services (India) Ltd., and existing Registrar & Transfer Agent for dematerialization of existing holding of the shareholders.

The International Securities Identification Number, allotted to the Company is INE681C01015. The equity shares of the Company are listed and traded on Bombay Stock Exchange Ltd., in "B" segment and National Stock Exchange of India Ltd. and are being traded in compulsory dematerialized mode. Presently 92.94% of equity capital of the company is in dematerialized mode.

Directors Responsibility Statement

In compliance with Section 217(2AA) of the Companies (Amendment) Act 2000, the Directors state that:

(a) In the preparation of annual accounts, the applicable accounting standards have been followed and proper explanations relating to material departures, if any, have been furnished.

(b) Accounting policies as listed in Schedule "N" to the financial statements have been selected and consistently applied and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the company as on 31st March, 2010 and of the Profit or Loss of the Company for the Accounting Year ended on that day.

(c) Proper and sufficient care for the maintenance of adequate accounting records has been taken in accordance with the provisions of the said act so as to safeguard the assets of the Company and to prevent and detect fraud and other irregularities.

(d) The annual accounts have been prepared on a going concern basis.

Corporate Governance

The Companies Act, 1956 & the listing agreement with the Stock exchanges require compliances with specified Corporate Governance practices. These practices have been fully implemented and a certificate from the Auditors of the Company as well as a detailed report on Corporate Governance, approved by the Board of Directors of the Company is set out in the annual report. The Company is regularly filing of reports including uploading of information in Electronic Data Information filing and Retrieval System/Corporate Filing & Dissemination system.

Human Resources

Your Directors acknowledge and appreciate the sincere efforts and effective services rendered by the committed officers and staff of the company.

The information required under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particular of Employees) Rules, 1975 as amended, regarding employees and forming part of this Report is furnished in the Annexure to this Report.

Auditors Observations

The Auditors have referred to certain routine matters in their report and the respective notes to the accounts are self-explanatory.

Conservation of Energy and Technology Absorption

The Companies (Disclosure of Particulars in the Report of Board of Directors) Rules 1988 require disclosure of particulars regarding conservation of energy in Form A and Technology Absorption in Form B prescribed by the rules. The Company not being a manufacturing Company is advised that Form A and B are not applicable to it.

Foreign Exchange Earnings & Expenditure

During the year the Company has earned an Income of Rs. 13.79 lacs in Foreign Exchange and has incurred an expenditure of Rs. 7.49 lacs in Foreign Exchange.

Fixed Deposits

During the year ended 31st March, 2010 the Company has not accepted any Fixed Deposits from the Public under Section 58-A of the Companies Act, 1956. The Company does not hold any Fixed Deposits from the public.

Directors

Shri B. Madhuprasad and Shri Hitesh Shah, Directors, retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment.

Your Directors recommend their re-appointment. Auditors

M/s. K. K. Bhageria & Co., Chartered Accountants and Statutory Auditors of the company will retire at the ensuing Annual General Meeting. The Board of Directors proposes to appoint M/s. Haribhakti & Company, Chartered Accountants, as a Statutory Auditor of the Company. Members are requested to consider appointment of M/s. Haribhakti & Company, at a remuneration to be decided by the Board of Director for the financial year 31st March, 2011.

Acknowledgment

We take this opportunity to express our deep sense of gratitude to Securities and Exchange Board of India, Bombay Stock Exchange Ltd., National Stock Exchange of India Ltd., Registrar of Companies, National Securities Depository Ltd., Central Depository Services (India) Ltd., Association of Merchant Bankers of India, M/s. Link Intime India Pvt. Ltd., Clients, Bankers and other Government Agencies for their continued support.

By Order of the Board

For Keynote Corporate Services Limited

Sd/-

Date :25th August, 2010 B. Madhuprasad

Place : Mumbai Vice Chairman

 
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