Directors Report of Majestic Research Services & Solutions Ltd.

Mar 31, 2016

To,

The Members,

Majestic Research Services and Solutions Limited (MRSS India)

The Directors have pleasure in submitting the Annual Report of the Company together with the Audited Statements of Accounts for the year ended 31^st March 2016.

1. FINANCIAL SUMMARY

(Amount in Rs.

Particulars	2015-16	2014-15
Total Revenue	11,27,49,669	5,50,76,925
Total Expenses	8,46,01,162	4,73,18,221
Profit or Loss before Exceptional and Extraordinary items and Tax	2,81,48,507	77,58,704
Less: Exceptional Items	-	-
Less: Extraordinary Items	-	-
Profit or Loss before Tax	2,81,48,507	77,58,704
Less: Current Tax	(93,98,408)	(30,06,134)
Deferred Tax (Liability)/ Asset	2,51,597	5,77,122
Profit or (Loss) After Tax	1,90,01696	53,29,692
Add: Balance as per last Balance Sheet	68,10,719	14,81,027
Less: Transfer to Reserves	-	-
Balance Transferred to Balance Sheet	2,58,12,415	68,10,719

2. REVIEW OF OPERATIONS

During the year under review, revenue of the Company was Rs. 11,27,49,669/- as compared to Rs. 5,50,76,925/- in the corresponding previous year. The Company earned profit after tax of Rs. 1,90,01696/-as compared to Rs. 53,29,692/- in the previous year. The Company’s Reserves and Surplus increased from Rs. 2,58,12,415/to Rs. 68,10,719/-. Your Directors are optimistic about company’s business and hopeful of better performance with increased revenue in next year. There was no change in the nature of business of company.

3. DIVIDEND

No Dividend is recommended by the directors for the year under review as the Board of Directors wants to plough back the profit in the business growth.

4. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND

The provisions of Section 125(2) of the Companies Act, 2013 does not apply as there was no dividend declared and paid last year.

5. SHARE CAPITAL AND INTIAL PUBLIC OFFER

The Authorized share capital of the Company was increased on 28^th September, 2015 form Rs. 4,50,00,000 (Rupees Four Crore Fifty Lakhs Only) divided into 45,00,000 ( Forty Five Lakhs) equity shares of Rs. 10/-(Rupees Ten Only) each to Rs. 15,00,00,000/- (Rupees Fifteen Crore Only) divided into 1,50,00,000 (One Crore Fifty Lakhs) equity shares of Rs. 10/- (Rupees Ten Only).

During the Year, the company has completed the Initial Public Issue (IPO) and raised a total capital of Rs. 142.80 Lakhs comprises of fresh issue of 11,20,000 Equity Shares of face value of Rs. 10/- (Rupees Ten Only) each for cash at a premium of Rs. 2.75/- Per Share. The equity shares of the company were listed on BSE SME Platform effective from 16^th July, 2015 and subsequent to this the paid share capital of the Company is increased from 3,00,20,000 (Rupees Three Crore Twenty Thousand Only) divided into 30,02,000 (Thirty Lakhs Two Thousand) equity shares of Rs. 10 (Rupees Ten Only) each to Rs. 4,12,20,000 (Rupees Four Crore Twelve Lakhs Twenty Thousand) divided into 41,22,000 (Forty One Lakhs Twenty Two Thousand) equity shares of Rs. 10/- (Rupees Ten Only) each.

6. USE OF PROCEEDS

The proceeds from the Initial Public Issue (IPO) of the Company have been deployed for the purpose of the objects as stated in the prospectus dated 24^th June, 2015.

7. MANAGEMENT DISCUSSION & ANALYSIS REPORTS

Management Discussion & Analysis Report has been separately furnished in the Annual Report.

8. FINANCE

Cash and Bank Balance as at 31^st March, 2016 was Rs. 64,23,537/The Company continues to focus on judicious management of its working capital, receivable and other working capital parameters were kept under strict check through continuous monitoring.

9. DEPOSITS

The Company has neither accepted nor renewed any deposits during the year under review.

10. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013

Following are the particulars of loans, guarantees and investments under sec 186 of the Companies Act, 2013.

A) Loans Provided:-

Sr. No	Name of Parties	Opening Balance (In Rs.	Amount of Transaction during the Year (In Rs.	Amount of Repayment (In Rs.	Closing Balance (In Rs.
1	Pure Online Panel Research Services Private Limited	NIL	2,141,521/-	NIL	2,141,521/-
2	Atrevido Research and Consultants Private Limited (Earlier Known as Emtee Research and Consultants Private Limited	NIL	1,51,302/-	NIL	1,51,302/-

B) Guarantees Provided :- NIL

C) Investments Made:-

Sr. No	Nature of Investment	Opening Balance (In Rs.	Amount of Transaction during the Year (In Rs.	Closing Balance (In Rs.
1	Atrevido Research and Consultants Private Limited.
	(Investment in wholly Owned Subsidiary)	70,000/-	30,000/-	1,00,000/-
2	Scent Analysis Majestic Private Limited.
	(Investment in Joint Venture Entity)	50,000/-	NIL	50,000/-

11. INTERNAL CONTROL SYSTEM AND RISK MANAGEMENT

The Company has established a well-defined process of risk management, wherein the identification, Analysis and assessment of the various risks, measuring of the probable impact of such risks, formulation of risk mitigation strategy and implementation of the same takes place in a structured manner. Though the various risks associated with the business cannot be eliminated completely, all efforts are made to minimize the impact of such risks on the operations of the Company. Necessary internal control systems are also put in place by the Company on various activities across the board to ensure that business operations are directed towards attaining the stated organizational objectives with optimum utilization of the resources.

12. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The provisions of Section 134(m) of the Companies Act, 2013 is not applicable to our Company as the company does not own any manufacturing facility.

There was foreign exchange inflow of Rs. 5,51,64,270 for exports and Outflow of Rs. 35,02,005 for project expenses during the year under review.

13. INDUSTRIAL RELATION

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

14. DIRECTORS AND KEY MANAGERIAL PERSONNEL

Retire by Rotation:-

In accordance with the provisions of the Companies Act, 2013 and Articles of Association of the Company, Mr. - Rajendra Kumar Sharma, Whole Time Director (DIN: 06879460) of the company is liable to retire by rotation in the fourth coming Annual General Meeting and being eligible, he offer himself for re-appointment.

15. COMPOSITION OF BOARD AND STATUTORY COMMITTEES FORMED THEREOF

Board of Directors:

Category	Name of Director
Executive and Non Independent Director	Mr. Rajendra Kumar Sharma
	Mr. Sarang Panchal
Non-Executive and Independent Director	Mr. Rupesh Bhujbal
	Ms. Priamvada Princeton
	Mr. Rajesh Oberoi

Audit Committee:

Sr. No.	Name	Status in Committee
1	Rupesh Bhujbal	Chairman
2	Priamvada Princeton	Member
3	Rajesh Oberoi	Member
4	Sonali Gamne	Secretary

Nomination And Remuneration Committee:

Sr. No.	Name	Status in Committee
1	Rupesh Bhujbal	Chairman
2	Priamvada Princeton	Member
3	Rajesh Oberoi	Member
4	Sonali Gamne	Secretary

Stake Holders Relationship Committee:

Sr. No.	Name	Status in Committee
1	Rupesh Bhujbal	Chairman
2	Priamvada Princeton	Member
3	Rajesh Oberoi	Member
4	Sonali Gamne	Secretary

16. DECLARATION OF INDEPENDENT DIRECTORS

All Independent Directors have given declarations that they meet criteria of independence as laid down under Section 149(6) of the Companies Act, 2013.

17. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013, the Board has carried out an evaluation of its own performance, the directors individual as well as the evaluation of the working of its Committees. The performance evaluations of independent Directors were also carried out and the same was noted.

18. NOMINATION AND REMUNERATION COMMITTEE

The Board has on the recommendation of the and remuneration committee framed a policy for selection and appointment of directors, Senior Management and their remuneration.

19. MEETINGS OF THE BOARD

Twelve meetings of the Board of Directors were held during the year. The intervening gap between the meetings was within the period prescribed under Companies Act, 2013.

20. DIRECTORS RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanation obtained by them, your Directors make the following statements in terms of the Section 134(3)(c) of the Companies Act, 2013:

(i) That in the preparation of the annual financial statements for the year ended March31, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

(ii) That such accounting policies, as mentioned in the Financial Statements as ‘Significant Accounting Policies’ have been selected and applied consistently and judgments and estimates have been made 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, 2016 and of the profit of the Company for the year ended on that date;

(iii) That proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) That the annual financial statements have been prepared on a going concern basis;

(v) That proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;

(vi) That proper systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

21. RELATED PARTY TRANSACTIONS

All the related party transactions that were entered into during the financial year were on arm’s length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the Company at large. Particulars of contract or arrangements with related parties is annexed herewith in Form AOC 2 as “Annexure - B”.

22. SUBSIDIARY AND JOINT VENTURE COMPANIES WHOLLY OWNED SUBSIDARY • ATREVIDO RESEARCH AND

CONSULTANTS PRIVATE LIMITED (ARCPL) (Earlier Known as Emtee Research & Consultants Private Limited)

Company was incorporated on 12^th August, 2014. The Company earned a profit after tax of Rs. 1,18,673/- Your company also acquired balance 30% stake in Subsidiary and made it wholly owned subsidiary effective from 8^th February, 2016. The name of the wholly owned subsidiary Company Emtee Research and Consultants Private Limited has been changed to "Atrevido Research And Consultants Private Limited" effective from 19^th February, 2016. The Company is engaged in providing market research services with a purpose of providing complete, fast and accurate information to clients using latest digital technology based on Android platform. The silent features of financial statement of subsidiary and joint venture in form AOC-1 is attached as “Annexure A” which forms part of this report.

JOINT VENTURE • SCENT ANALYSIS MAJESTIC PRIVATE LIMITED (SAMPL)

Company was incorporated on 10^th October, 2014. Company is at early stage and just commence operations so, there is loss of Rs. 6,50,500/-. Your company holds 50% of equity shares in SAMPL since 10^th October, 2014. The company is the Jointly Controlled Entity and it is incorporated by way of Joint Venture agreement entered into between Majestic Research Services and Solutions Limited and Analysis the Scent Company International Gmbh. The Company is engaged in providing market research services with a purpose to help clients at all stages of development. It fills the research gap between sensory science and traditional market research, providing rich and detailed consumer insights for product (sensorial) development. The silent features of financial statement of subsidiary and joint venture in form AOC-1 is attached as “Annexure A” which forms part of this report.

23. CODE OF CONDUCT

The Board of Director has approved a Code of Conduct which is applicable to the Members of the Board of Directors and all the employees in the course of day to day business operations of the Company.

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 dealing and in particulars on matters relating to integrity in the work place, in business practices and in dealing with stakeholders.

24. NOMINATION AND REMUNERATION POLICY

In terms of Section 178(3) of the Companies Act, 2013 and provisions of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, a policy on Director’s, Key Managerial Personnel and Senior Management Employee’s appointment and remuneration including criteria for determining their qualifications, positive attributes, independence and other prescribed matters was formulated and recommended by the Nomination and Remuneration Committee and adopted by the Board of Directors at their respective meetings held on 26^th December, 2015.

25. WHISTLE BLOWER POLICY / VIGIL MECHANISM

During the year, your Directors have constituted a Whistle Blower Policy /Vigil mechanism policy for the company to report to the management instances of unethical behavior, actual or suspected, fraud or violation of the company’s code of conduct of the company.

26. COMMITTEE AND POLICY UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has constituted Internal Complaints Committee under and as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year under review, no instance of compliant or report under the said Act was registered in any of the units of the Company.

27. STATUTORY AUDITORS

M/s .R. T. Jain, Chartered Accountants, (having Firm Reg. No. 103961W) as Statutory Auditors of the Company, holds office from the conclusion of this 3^rd Annual General Meeting until the conclusion of the 8thAnnual General Meeting subject to annual ratification by members of the company at every Annual General Meeting. The Company has received letter from M/s R. T. Jain, Chartered Accountants., to the effect that of appointment, if made, would be within the prescribed limits under Section 139 of the Companies Act, 2013 and that they are not disqualified for such appointment within the meaning of Section 141 of the Companies Act, 2013.

28. SECRETARIAL AUDIT

In terms of Section 204 of the Companies Act, 2013 and Rules made there under, Ms. Rupal D Jhaveri, Practicing Company Secretary, Mumbai have been appointed as a Secretarial Auditors of the Company in the meeting of the Board of Directors held on 5^th September, 2015. The report of the Secretarial Auditor is enclosed as “Annexure-D”.

29. INTERNAL AUDITOR

In terms of Section 138 of the Companies Act, 2013 and Rules made there under, M/s. Lalit Parmar and Associates, Chartered Accountants, Mumbai have been appointed as an Internal Auditors of the Company in the meeting of the Board of Directors held on 5^th September, 2015. During the year, the company continued to implement his suggestions and recommendations to improve the control environment. Their scope of works includes, review of processes for safeguarding the assets of the Company, review of operational efficiency, effectiveness of systems and processes, and assessing the internal control strengths in all areas.

30. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND THE PRACTICING COMPANY SECRETARY IN THEIR REPORTS

There are no qualifications, reservations or adverse remarks made by the Auditors in their report except outstanding statutory dues of Rs. 25,40,488/- as on March 31, 2016 for a period of more than six months from the date they became payable.

31. EXTRACT OF ANNUAL RETURN

The details forming part of extract of Annual Return in Form MGT - 9 is annexed herewith as “Annexure C”.

32. PARTICULARS OF EMPLOYEES

There was no employee who was employed throughout the year or part thereof and in receipt of remuneration aggregating to Rs. 60,00,000/- p.a or more or who was employed for part of the year and in receipt of remuneration aggregating to Rs. 5,00,000/- p.m or more.

PARTICULARS AS PER RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014.

The details related to employees and their remuneration as required under Section 197(12) and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are mentioned in “Annexure E” to this Board’s Report. Disclosure under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is not applicable to the company as no employee falls under the threshold provided therein.

33. CORPORATE GOVERNANCE

The Company being listed on the Small and Medium Enterprise platform is exempted from provision of corporate governance as per Regulation 15 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. Hence no corporate governance report is disclosed in this Annual Report. However we have complied with the relevant provision of the Companies Act, 2013 and rules there under with regards to formation of committees.

35. CORPORATE SOCIAL RESPONSIBILITY

Aggregate number of shareholders and the outstanding shares in the suspense account lying at the beginning of the year	Number of shareholders who approached listed entity for transfer of shares from suspense account during the year	Number of shareholders to whom shares were transferred from suspense account during the year	Aggregate number of shareholders and the outstanding shares in the suspense account lying at the end of the year
NIL	NIL	NIL	NIL

The provisions of Section 135(1) and 135(5) of the Companies Act, 2013 regarding constitution of Corporate Social Responsibility (CSR) Committee and spending of at least 2% of average net profit are not applicable to the Company.

36. ACKNOWLEDGEMENTS

The Board of Directors wish to place on record their appreciation for support extended by the bankers, business associates, clients, consultants, auditors, shareholders and the employees of the Company for their co-operation and support.

The Board of Directors would also like to place on record their sincere appreciation for the cooperation received from the Local Authorities and all statutory and/or regulatory bodies.

For and on behalf of the Board Rajendra Kumar Sharma

(Chairman and Whole Time Director)

DIN: 06879460

Mumbai, 3^rd September, 2016