V.B.Desai Financial Services Ltd — Annual Report 2021

Aug 23, 2021

V.B. Desai Financial Services Limited

Category I Merchant Banker - SEBI Registration No. INM 000002731

Date: August 23, 2021

The Manager, Dept. of Corporate Services BSE Limited P.J. Tower, Dalal Street, Fort, Mumbai – 400 001

Dear Sir,

Sub: Submission of Annual Report for the year 2020-2021.

Pursuant to Regulation 34(1) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we hereby submit the Annual Report for the Financial Year 2020-21 along with the Notice of Annual General Meeting.

The said Annual Report with Notice of Annual General Meeting has also been uploaded on the website of the Company at www.vbdesai.com under subheading of shareholders information.

Kindly take the same on your record.

Thanking you,

Yours faithfully, For V.B. DESAl FINANCIAL SERVICES LIMITED

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Kamlesh M Gagvani Company Secretary

Encl: as above

------------------------------------------------------------------------------------------------------------------------------------------------------------Registered Office : Cama Building, 1st Floor, 24/26 Dalai Street, Fort, Mumbai 400 001 CIN: L74120MH1985PLC037218 Tel.: +91 - 22-4077 0777 Web: www.vbdesai.com Tel.: +91 - 22-4077 0777 Web: www.vbdesai.com E-mail: info@vbdesai.co

V. B. DESAI FINANCIAL SERVICES LIMITED

35TH ANNUAL REPORT 2020-2021

V. B. Desai Financial Services Limited

V. B. DESAI FINANCAL SERVICES LIMITED

CIN L74120MH1985PLC037218

BOARD OF DIRECTORS

Mr. Samir R. Dedhia- Chairman (DIN 06864567) Mr. Pradip R. Shroff - Managing Director (DIN00286291)

Mr. Manoj T. Shroff (DIN 00330560)

Mr. Hemendra J. Shroff (DIN 00286509) Mrs. Rachana S. Vijayakar (DIN 03317373) Mr. Nilesh R. Doshi (DIN 00249715)

Chief Financial Officer

Mr. Shashank S. Vijayakar

Company Secretary & Compliance Officer

Mr. Kamlesh M. Gagavani

REGISTERED OFFICE

Cama Building, 1st Floor, 24/26, Dalal Street, Fort, Mumbai – 400 001

AUDITORS

M/s. N.S. SHETTY & CO. Chartered Accountants, Mumbai

BANKERS

HDFC Bank Ltd. Corporation Bank

REGISTRAR & SHARE TRANSFER AGENT

Purva Sharegistry (India) Pvt. Ltd. 9, Shiv Shakti Industrial Estate J.R.Boricha Marg, Lower Parel (East), Mumbai – 400 011. Tel: 022-23016761

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CONTENTS Page No.
Board of Directors 2
Notice 3
Directors’ Report 12
Secretarial Audit Report 20
Report on Corporate Governance 23
Auditors’ Report 30
Balance Sheet 35
Profit & Loss Account 36
Cash Flow Statement 37
Corporate Information 39
Notes forming part of the Financial Statements 41
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IMPORTANT COMMUNICATION TO MEMBERS

The Ministry of Corporate Affairs has taken the “Green Initiative in the Corporate Governance” by allowing paperless compliances by the companies and has issued circulars stating that service of notice / document including annual report can be sent by e-mail to its members. To support this green initiative of the Government in full measures, members who have so far not registered their e-mail addresses are requested to register their e-mail addresses, in respect of electronic holdings with the Depository through their concerned Depository Participants. Members who hold shares in physical form are requested to send the e-mail address to the Registrar & Transfer Agents quoting their folio number.

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NOTICE

NOTICE is hereby given that the Thirty Fifth Annual General Meeting of V.B. Desai Financial Services Limited will be held on Friday the 17th day of September, 2021 at 11.00 am through Video Conferencing/ Other Audio Visual Means (OAVM) to transact the following business: business.

ORDINARY BUSINESS

1. To receive and adopt the Profit and Loss Account for the year ended on 31[st ] March, 2021 and the Balance Sheet as on that date and the reports of Auditors and Directors thereof.

2. To appoint a Director in place of Mr. Manoj T. Shroff (DIN 00330560), who retires by rotation at this Annual General Meeting and being eligible has offered himself for re-appointment.

3. To appoint a Director in place of Mrs. Rachana S. Vijayakar (DIN 03317373), who retires by rotation at this Annual General Meeting and being eligible has offered herself for re-appointment.

SPECIAL BUSINESS:

4. To consider and if thought fit, to pass with or without modification(s), the following resolutions as Ordinary Resolutions:

“RESOLVED THAT pursuant to provisions of Section 188 and other applicable provisions, if any, of the Companies Act, 2013 read with applicable Rules under Companies (Meetings of Board and its Powers) Rules, 2014 and in terms of applicable provisions of SEBI Listing Regulations, consent of the members of the Company be and is hereby accorded for entering into the following proposed Related Party Transactions with respect to rendering of services to the Company with effect from1st April 2021 to 31st March 2022 up to the amounts as appended in table below:

S.No.	Name of Related Party	Relationship defined under Section of the Companies Act, 2013	Maximum value of Transaction per annum
1	Aarayaa Advisory Services Pvt. Ltd.	Section 2 (76) (iv)	Professional fees for rendering services not to exceed Rupees Three crore in an accounting year.
2	Desai Investments Private Limited	Section 2 (76) (iv)	Inter corporate loan and Investments in equity shares not to exceed Rupees One crore in an accounting year.

“RESOLVED FURTHER THAT the Board of Directors of the Company be and are hereby authorised to do all acts and take all such steps as may be necessary, proper or expedient to give effect to this resolution.”

By the order of the Board of Directors

Kamlesh M. Gagavani Company Secretary

REGISTERED OFFICE

Cama Building, 1[st] Floor, 24/26, Dalal Street, Fort, Mumbai – 400 001

DATED: August 11, 2021

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V. B. Desai Financial Services Limited

EXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013

The following is the Explanatory Statement as required by Section 102 of the Companies Act, 2013, sets out all material facts relating to Special Business mentioned in the Notice for convening the Annual General Meeting of the members of the Company:

Item No. 4

Section 188 of the Companies Act, 2013 read with rules 15 and 16 of Companies (Meetings of Board and its Powers) Rules, 2014 prescribe certain procedure for approval of related party transactions. The SEBI Listing Regulations has also prescribed seeking of shareholders’ approval for material related party transactions. The proviso to section 188 also states that nothing in section 188(1) will apply to any transaction entered into by the company in its ordinary course of business and at arm’s length basis.

All the proposed transactions put up for approval are in ordinary course of business and at arm’s length. Pursuant to the provisions of Listing Regulations, the following transactions are material in nature and require the approval of the unrelated shareholders of the Company by a special resolution. The other related information as envisaged under Companies (Meetings of Board and its Powers) Rules, 2014 and amendments thereto, and the Company’s Related Party Transaction Policy are furnished hereunder:

S.No.	Name of Related Party	Relationship defined under Section of the Companies Act, 2013	Maximum value of Transaction per annum
1	Aarayaa Advisory Services Pvt. Ltd.	Section 2 (76) (iv)	Professional fees for rendering services not to exceed Rupees Three crore in an accounting year.
2	Desai Investments Private Limited	Section 2 (76) (iv)	Inter corporate loan and Investments in equity shares not to exceed Rupees One crore in an accounting year.

The Audit Committee at its meeting held on 9[th] June 2021 has given omnibus approval for the above transactions and recommended by the Board of Directors to the unrelated shareholders of the Company for their approval.

The entities / persons that are directly / indirectly related parties of the Company shall abstain from voting on resolution wherein approval of material Related Party Transactions is sought from the shareholders. Accordingly, all related parties of the Company, including the Directors and Key Managerial Personnel of the Company will not vote on this resolution.

None of the Directors or any of the Key Managerial Personnel of the Company or their relatives other than Mr. Pradip R. Shroff, Mr. Hemendra J. Shroff and Mr. Manoj T. Shroff are, in any way, concerned or interested, financially or otherwise, in the Special Resolution set out at Item No. 4 of the Notice. The Board recommends the Special Resolution set out at Item No. 4 of the Notice for approval by the unrelated shareholders.

For and on behalf of the Board of Directors

Kamlesh M. Gagavani Company Secretary

REGISTERED OFFICE

Cama Building, 1[st ] Floor, 24/26, Dalal Street, Fort, Mumbai – 400 001

DATED: August 11, 2021

IMPORTANT NOTES

1. In view of the massive outbreak of the COVID-19 pandemic, social distancing is a norm to be followed and pursuant to the Circular No. 14/2020 dated April 08, 2020, Circular No.17/2020 dated April 13, 2020 issued by the Ministry of Corporate Affairs followed by Circular No. 20/2020 dated May 05, 2020 and Circular No. 02/2021 dated January 13, 2021 and all other relevant circulars issued from time to time, physical attendance of the Members to the EGM/AGM venue is not required and general meeting be held through video conferencing (VC) or other audio visual means (OAVM). Hence, Members can attend and participate in the ensuing EGM/AGM through VC/OAVM. The requirement of appointment of proxies pursuant to the provisions of Section 105 of the Act has been dispensed with. Accordingly, attendance slip and proxy form will not be annexed to this Notice. The Members can attend and participate in the ensuing AGM through VC/OAVM. The deemed venue for the meeting shall be registered office of the Company at Cama Building, 1[st] Floor, 24/26, Dalal Street, Fort, Mumbai – 400 001, Maharashtra, India.

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1. Pursuant to the Circular No. 14/2020 dated April 08, 2020, issued by the Ministry of Corporate Affairs, the facility to appoint proxy to attend and cast vote for the members is not available for this AGM. However, the Body Corporates are entitled to appoint authorised representatives to attend the AGM through VC/OAVM and participate thereat and cast their votes through e-voting.

2. The Members can join the AGM in the VC/OAVM mode 15 minutes before and after the scheduled time of the commencement of the Meeting by following the procedure mentioned in the Notice. The facility of participation at the AGM through VC/OAVM will be made available for 1000 members on first come first served basis. This will not include large Shareholders (Shareholders holding 2% or more shareholding), Promoters, Institutional Investors, Directors, Key Managerial Personnel, the Chairpersons of the Audit Committee, Nomination and Remuneration Committee and Stakeholders Relationship Committee, Auditors etc. who are allowed to attend the AGM without restriction on account of first come first served basis.

3. The attendance of the Members attending the AGM through VC/OAVM will be counted for the purpose of reckoning the quorum under Section 103 of the Companies Act, 2013.

4. Pursuant to the provisions of Section 108 of the Companies Act, 2013 read with Rule 20 of the Companies (Management and Administration) Rules, 2014 (as amended) and Regulation 44 of SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015 (as amended), and the Circulars issued by the Ministry of Corporate Affairs dated April 08, 2020, April 13, 2020 and May 05, 2020 the Company is providing facility of remote e-voting to its Members in respect of the business to be transacted at the AGM. For this purpose, the Company has entered into an agreement with National Securities Depository Limited (NSDL) for facilitating voting through electronic means, as the authorized agency. The facility of casting votes by a member using remote e-voting system as well as venue voting on the date of the AGM will be provided by NSDL.

5. In line with the Ministry of Corporate Affairs (MCA) Circular No. 17/2020 dated April 13, 2020, the Notice calling the AGM has been uploaded on the website of the Company at www.vbdesai.com. The Notice can also be accessed from the websites of the Stock Exchanges i.e. BSE Limited at www.bseindia.com and the AGM Notice is also available on the website of NSDL (agency for providing the Remote e-Voting facility) i.e. www.evoting.nsdl.com.

6. AGM has been convened through VC/OAVM in compliance with applicable provisions of the Companies Act, 2013 read with MCA Circular No. 14/2020 dated April 08, 2020 and MCA Circular No. 17/2020 dated April 13, 2020, MCA Circular No. 20/2020 dated May 05, 2020 and MCA Circular No. 2/2021 dated January 13, 2021.

7. The Securities and Exchange Board of India (SEBI) has mandated the submission of Permanent Account Number (PAN) by every participant in securities market. Members holding shares in electronic form are, therefore, requested to submit the PAN to their Depository Participants with whom they are maintaining their demat accounts. Members holding shares in physical form can submit their PAN details to the Company or Registrar and Transfer Agents of the Company.

8. As per Regulation 40 of the SEBI Listing Regulations, as amended, securities of listed companies can only be transferred in demat form with effect from April 1, 2019, except in case of request for transmission or transposition of securities. In view of this and to eliminate all risks associated with physical shares and for ease of portfolio management, Members holding shares in physical form are requested to consider converting their holding to demat form. Members can contact the Company or our RTA for assistance in this regard.

9. Details of the Directors seeking appointment/ re- appointment at the Annual General Meeting, forms integral part of the notice and given in Annexure “A” to this notice.

10. Since the AGM will be held through VC/OAVM, the Route Map is not required to be annexed in this to the Notice.

THE INSTRUCTIONS FOR MEMBERS FOR REMOTE E-VOTING ARE AS UNDER:

The remote e-voting module shall be disabled by NSDL for voting thereafter. The remote e-voting period begins on Tuesday, 14[th] September, 2021 at 9:00 A.M. and ends on Thursday, 16[th] September, 2021 at 5:00 P.M. The remote e- voting module shall be disabled by NSDL for voting thereafter. The Members, whose names appear in the Register of Members / Beneficial Owners as on the record date (cut-off date) i.e. 10[th] September 2021, may cast their vote electronically. The voting right of shareholders shall be in proportion to their share in the paid-up equity share capital of the Company as on the cut-off date, being 10[th] September 2021.

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- How do I vote electronically using NSDL e Voting system?

The way to vote electronically on NSDL e-Voting system consists of “Two Steps” which are mentioned below:

Step 1: Access to NSDL e-Voting system

A) Login method for e-Voting and joining virtual meeting for Individual shareholders holding securities in demat mode

In terms of SEBI circular dated December 9, 2020 on e-Voting facility provided by Listed Companies, Individual shareholders holding securities in demat mode are allowed to vote through their demat account maintained with Depositories and Depository Participants. Shareholders are advised to update their mobile number and email Id in their demat accounts in order to access e-Voting facility.

Login method for Individual shareholders holding securities in demat mode is given below:

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Type of Login Method
shareholders
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Type of shareholders Login Method

Type of shareholders Login Method

Individual Shareholders holding securities in demat mode with NSDL.

1. ExistingIDeASuser can visit the e-Services website of NSDL Viz. https://eservices.nsdl.com either on a Personal Computer or on a mobile. On the e-Services home page click on the “Beneficial Owner”icon under“Login”which is available under‘IDeAS’section , this will prompt you to enter your existing User ID and Password. After successful authentication, you will be able to see e-Voting services under Value added services. Click on“Access to e- Voting”under e-Voting services and you will be able to see e-Voting page. Click on company name ore-Voting service provider i.e. NSDLand you will be re-directed to e-Voting website of NSDL for casting your vote during the remote e-Voting period or joining virtual meeting & voting during the meeting. 2. If you are not registered for IDeAS e-Services, option to register is available at https://eservices.nsdl.com. Select“Register Online for IDeAS Portal”or click at https://eservices.nsdl.com/SecureWeb/IdeasDirectReg.jsp 3. Visit the e-Voting website of NSDL. Open web browser by typing the following URL: https://www.evoting.nsdl.com/ either on a Personal Computer or on a mobile. Once the home page of e-Voting system is launched, click on the icon “Login” which is available under ‘Shareholder/Member’ section. A new screen will open. You will have to enter your User ID (i.e. your sixteen digit demat account number hold with NSDL), Password/OTP and a Verification Code as shown on the screen. After successful authentication, you will be redirected to NSDL Depository site wherein you can see e-Voting page. Click on company name ore-Voting service provider i.e. NSDLand you will be redirected to e-Voting website of NSDL for casting your vote during the remote e-Voting period or joining virtual meeting & voting during the meeting. 4. Shareholders/Members can also download NSDL Mobile App “NSDL Speede” facility by scanning the QR code mentioned below for seamless voting experience.

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Individual Shareholders holding securities in demat mode with CDSL

1. Existing users who have opted for Easi / Easiest, they can login through their user id and password. Option will be made available to reach e-Voting page without any further authentication. The URL for users to login to Easi / Easiest are https://web.cdslindia.com/ myeasi/home/login or www.cdslindia.com and click on New System Myeasi. 2. After successful login of Easi/Easiest the user will be also able to see the E Voting Menu. The Menu will have links ofe-Voting service provider i.e. NSDL.Click onNSDLto cast your vote. 3. If the user is not registered for Easi/Easiest, option to register is available at https://web.cdslindia.com/myeasi/Registration/EasiRegistration 4. Alternatively, the user can directly access e-Voting page by providing demat Account Number and PAN No. from a link in www.cdslindia.com home page. The system will authenticate the user by sending OTP on registered Mobile & Email as recorded in the demat Account. After successful authentication, user will be provided links for the respective ESP i.e.NSDLwhere the e-Voting is in progress.

Individual Shareholders (holding securities in demat mode) login through their depository participants

You can also login using the login credentials of your demat account through your Depository Participant registered with NSDL/CDSL for e-Voting facility. upon logging in, you will be able to see e-Voting option. Click on e-Voting option, you will be redirected to NSDL/CDSL Depository site after successful authentication, wherein you can see e-Voting feature. Click on company name or e-Voting service provider i.e. NSDL and you will be redirected to e-Voting website of NSDL for casting your vote during the remote e-Voting period or joining virtual meeting & voting during the meeting.

Important note: Members who are unable to retrieve User ID/ Password are advised to use Forget User ID and Forget Password option available at abovementioned website.

Helpdesk for Individual Shareholders holding securities in demat mode for any technical issues related to login through Depository i.e. NSDL and CDSL.

Login type	Helpdesk details
Individual Shareholders holding securities in demat mode with NSDL	Members facing any technical issue in login can contact NSDL helpdesk by sending a request at evoting@nsdl.co.in or call at toll free no.: 1800 1020 990 and 1800 22 44 30
Individual Shareholders holding securities in demat mode with CDSL	Members facing any technical issue in login can contact CDSL helpdesk by sending a request at helpdesk.evoting@cdslindia.com or contact at 022- 23058738 or 022-23058542-43

B) Login Method for e-Voting and joining virtual meeting for shareholders other than Individual shareholders holding securities in demat mode and shareholders holding securities in physical mode.

How to Log-in to NSDL e-Voting website?

1. Visit the e-Voting website of NSDL. Open web browser by typing the following URL: https://www.evoting.nsdl.com/ either on a Personal Computer or on a mobile.

2. Once the home page of e-Voting system is launched, click on the icon “Login” which is available under ‘Shareholder/Member’ section.

3. A new screen will open. You will have to enter your User ID, your Password/OTP and a Verification Code as shown on the screen.

Alternatively, if you are registered for NSDL eservices i.e. IDEAS, you can log-in at

https://eservices.nsdl.com/ with your existing IDEAS login. Once you log-in to NSDL eservices after using your log-in credentials, click on e-Voting and you can proceed to Step 2 i.e. Cast your vote electronically.

1. Your User ID details are given below:

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• Manner of holding shares i.e. Demat Your User ID is: (NSDL or CDSL) or Physical a) For Members who hold shares in 8 Character DP ID followed by 8 Digit Client ID demat account with NSDL. For example if your DP ID is IN300 and Client ID is 12 then your user ID is IN30012**.

• b) For Members who hold shares in 16 Digit Beneficiary ID demat account with CDSL. For example if your Beneficiary ID is 12** then your user ID is 12**

• c) For Members holding shares in EVEN Number followed by Folio Number registered with the Physical Form. company For example if folio number is 001 and EVEN is 101456 then user ID is 101456001

• 1. Password details for shareholders other than Individual shareholders are given below: If you are already registered for e-Voting, then you can user your existing password to login and cast your vote.

• a) If you are using NSDL e-Voting system for the first time, you will need to retrieve the ‘initial password’ which was communicated to you. Once you retrieve your ‘initial password’, you need to enter the ‘initial password’ and the system will force you to change your password.

• b) How to retrieve your ‘initial password’? (i) If your email ID is registered in your demat account or with the company, your ‘initial password’ is communicated to you on your email ID. Trace the email sent to you from NSDL from your mailbox. Open the email and open the attachment i.e. a .pdf file. Open the .pdf file. The password to open the .pdf file is your 8 digit client ID for NSDL account, last 8 digits of client ID for CDSL account or folio number for shares held in physical form. The .pdf file contains your ‘User ID’ and your ‘initial password’.

• (ii) If your email ID is not registered, please follow steps mentioned below in process for those shareholders whose email ids are not registered.

• 1. If you are unable to retrieve or have not received the “ Initial password” or have forgotten your password: a) Click on “ Forgot User Details/Password ?”(If you are holding shares in your demat account with NSDL or CDSL) option available on www.evoting.nsdl.com.

• b) Physical User Reset Password ?” (If you are holding shares in physical mode) option available on www.evoting.nsdl.com.

• c) If you are still unable to get the password by aforesaid two options, you can send a request at evoting@nsdl.co.in mentioning your demat account number/folio number, your PAN, your name and your registered address etc.

• d) Members can also use the OTP (One Time Password) based login for casting the votes on the e-Voting system of NSDL.

• 1. After entering your password, tick on Agree to “Terms and Conditions” by selecting on the check box. 8. Now, you will have to click on “Login” button.

• After you click on the “Login” button, Home page of e-Voting will open.

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- Step 2: Cast your vote electronically and join General Meeting on NSDL e Voting system.

- How to cast your vote electronically and join General Meeting on NSDL e Voting system?

1. After successful login at Step 1, you will be able to see all the companies “EVEN” in which you are holding shares and whose voting cycle and General Meeting is in active status.

2. Select “EVEN” of company for which you wish to cast your vote during the remote e-Voting period and casting your vote during the General Meeting. For joining virtual meeting, you need to click on “VC/OAVM” link placed under “Join General Meeting”.

3. Now you are ready for e-Voting as the Voting page opens.

4. Cast your vote by selecting appropriate options i.e. assent or dissent, verify/modify the number of shares for which you wish to cast your vote and click on “Submit” and also “Confirm” when prompted.

5. Upon confirmation, the message “Vote cast successfully” will be displayed.

6. You can also take the printout of the votes cast by you by clicking on the print option on the confirmation page.

7. Once you confirm your vote on the resolution, you will not be allowed to modify your vote.

General Guidelines for shareholders

1. Institutional shareholders (i.e. other than individuals, HUF, NRI etc.) are required to send scanned copy (PDF/JPG Format) of the relevant Board Resolution/ Authority letter etc. with attested specimen signature of the duly authorized signatory(ies) who are authorized to vote, to the Scrutinizer by e-mail to hariharan41@yahoo.com with a copy marked to evoting@nsdl.co.in.

2. It is strongly recommended not to share your password with any other person and take utmost care to keep your password confidential. Login to the e-voting website will be disabled upon five unsuccessful attempts to key in the correct password. In such an event, you will need to go through the “Forgot User Details/Password?” or “Physical User Reset Password?” option available on www.evoting.nsdl.com to reset the password.

3. In case of any queries, you may refer the Frequently Asked Questions (FAQs) for Shareholders and e-voting user manual for Shareholders available at the download section of www.evoting.nsdl.com or call on toll free no.: 1800 1020 990 and 1800 22 44 30 or send a request to evoting@nsdl.co.in

Process for those shareholders whose email ids are not registered with the depositories for procuring user id and password and registration of e mail ids for e-voting for the resolutions set out in this notice :

1. In case shares are held in physical mode please provide Folio No., Name of shareholder, scanned copy of the share certificate (front and back), PAN (self attested scanned copy of PAN card), AADHAR (self attested scanned copy of Aadhar Card) by email to info@vbdesai.com.

2. In case shares are held in demat mode, please provide DPID-CLID (16 digit DPID + CLID or 16 digit beneficiary ID), Name, client master or copy of Consolidated Account statement, PAN (self attested scanned copy of PAN card), AADHAR (self attested scanned copy of Aadhar Card) to info@vbdesai.com. If you are an Individual shareholders holding securities in demat mode, you are requested to refer to the login method explained at step 1 (A ) i.e. Login method for e-Voting and joining virtual meeting for Individual shareholders holding securities in demat mode .

3. Alternatively shareholder/members may send a request to evoting@nsdl.co.in for procuring user id and password for e-voting by providing above mentioned documents.

4. In terms of SEBI circular dated December 9, 2020 on e-Voting facility provided by Listed Companies, Individual shareholders holding securities in demat mode are allowed to vote through their demat account maintained with Depositories and Depository Participants. Shareholders are required to update their mobile number and email ID correctly in their demat account in order to access e-Voting facility.

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THE INSTRUCTIONS FOR MEMBERS FOR e-VOTING ON THE DAY OF THE AGM ARE AS UNDER:

1. The procedure for e-Voting on the day of the AGM is same as the instructions mentioned above for remote e-voting.

2. Only those Members/ shareholders, who will be present in the AGM through VC/OAVM facility and have not casted their vote on the Resolutions through remote e-Voting and are otherwise not barred from doing so, shall be eligible to vote through e-Voting system in the AGM.

3. Members who have voted through Remote e-Voting will be eligible to attend the AGM. However, they will not be eligible to vote at the AGM.

4. The details of the person who may be contacted for any grievances connected with the facility for e- Voting on the day of the AGM shall be the same person mentioned for Remote e-voting.

INSTRUCTIONS FOR MEMBERS FOR ATTENDING THE AGM THROUGH VC/OAVM ARE AS UNDER:

1. Member will be provided with a facility to attend the AGM through VC/OAVM through the NSDL e-Voting system. Members may access by following the steps mentioned above for Access to NSDL e-Voting system . After successful login, you can see link of “VC/OAVM link” placed under “Join General meeting” menu against company name. You are requested to click on VC/OAVM link placed under Join General Meeting menu. The link for VC/OAVM will be available in Shareholder/Member login where the EVEN of Company will be displayed. Please note that the members who do not have the User ID and Password for e-Voting or have forgotten the User ID and Password may retrieve the same by following the remote e-Voting instructions mentioned in the notice to avoid last minute rush.

2. Members are encouraged to join the Meeting through Laptops for better experience.

3. Further Members will be required to allow Camera and use Internet with a good speed to avoid any disturbance during the meeting.

4. Please note that Participants Connecting from Mobile Devices or Tablets or through Laptop connecting via Mobile Hotspot may experience Audio/Video loss due to Fluctuation in their respective network. It is therefore recommended to use Stable Wi-Fi or LAN Connection to mitigate any kind of aforesaid glitches.

5. Shareholders who would like to express their views/have questions may send their questions in advance mentioning their name demat account number/folio number, email id, mobile number at info@vbdesaicom. The same will be replied by the company suitably.

6. Those shareholders who have registered themselves as a speaker will only be allowed to express their views/ask questions during the meeting.

SCRUTINIZER AND DECLARATION OF REPORT

1. Mr. N. Hariharan of N. Hariharan and Company, Practicing Company Secretaries has been appointed as the Scrutinizer to scrutinize the remote e-voting process in a fair and transparent manner.

2. The Results declared along with the Scrutinizer’s Report shall be placed on the Company’s website www.vbdesai.com and on the website of NSDL immediately after the declaration of result by the Chairman or a person authorized by him in writing. The results shall also be immediately forwarded to the BSE Limited, Mumbai.

3. All documents referred to in the accompanying Notice and Explanatory Statements, shall be made available for inspection through electronic mode, basis the request being sent on info@vbdesai.com.

4. The Register of members and Share Transfer Books of the Company will be closed from 9th September 2021 to 15th September 2021 (both days inclusive).

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ANNEXURE –A

Brief Profile / Disclosure Relating to Directors Re-appointed pursuant to Regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Secretarial Standards on General Meetings:

1) Mr. Manoj T. Shroff

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DIN & Date of Birth 00330560 - 10/10/1966
Qualification B.Com
Experience in specific area Has more than 30 years’ experience in Financial consultancy, Investment
Banking, and other related business.
Directorship in other Companies Northstar Software Mahimna Mercantile Credits
Solutions Pvt. Ltd. Ltd
Archway Services Pvt. Ltd. Merican Funds Limited
Elder IT Solutions Pvt. Ltd. Guru Holding Private Limited
Pearl Housing Finance (I) Ltd.
Committee positions held in other Nil
Companies
No. of shares held in the 800
Company
----- End of picture text -----

2) Mrs. Rachana S. Vijayakar

==> picture [456 x 177] intentionally omitted <==

----- Start of picture text -----

DIN & Date of Birth 03317373 - 02/11/1969
Qualification BA
Experience in specific Mrs. Rachana Vijayakar is in Accounting profession having
area knowledge in Financial sector
Directorship in other Pearl Housing Finance (I) Ltd.
Companies Vishvakarma Equipment Finance Ltd.
Neptune Steel Strips Limited
Afamado Fashions Pvt. Ltd.
First Native Consultancy Pvt. Ltd.
Committee positions held Nil
in other
Companies
No. of shares held in the Nil
Company
----- End of picture text -----

Annual Report 2020-21

11

V. B. Desai Financial Services Limited

DIRECTORS’ REPORT

The Directors present their 35th Annual Report on the business and operations of the Company and the financial accounts for the year ended on 31[st ] March, 2021.

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FINANCIAL RESULTS (Rs. In lakhs )
Particulars For the year For the
ended on previous year
31/03/2021 ended on
31/03/2020
Gross Income 215.74 259.64
Profit (before interest,
66.99 73.64
depreciation & taxation)
Financial charges 0.00 0.00
Depreciation 0.65 2.46
Profit before profit 31.78 71.18
Provision for taxation for
6.69 11.84
current year
Deferred Tax 0.11 0.21
Income tax of earlier years/
5.55 0.00
MAT credit
Other comprehensive
0.00 0.00
Income
Profit after adjustments 19.41 59.13
Profit/(Loss) carried to
19.41 59.13
Balance Sheet
APPROPRIATIONS /
TRANSFERS
Profit/(loss) carried to
19.41 59.13
Balance Sheet
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Dividend

Your Directors do not recommend any dividend on equity shares in view of working capital requirement.

Performance review

In view of the massive outbreak of the COVID-19 pandemic, during the year under review, business was down compare to the previous year. The gross income has marginally decreased from Rs. 259.64 lakhs to Rs. 215.74 lakhs in the current year. The net profit after tax, adjustments and Other comprehensive income/ expenses under the Accounting Standard (Ind AS) applicable was stood at Rs. 19.41 lakhs against Rs. 59.13 lakhs in previous year.

Nature of business of the Company

The Company is mainly engaged in Merchant Banking activities focusing on ESOP valuation, Company valuation and Advisory services etc. There were no changes in nature of Company’s business during the year.

Material changes and commitments, if any, affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report

There were no material changes occurred subsequent to the close of the financial year of the Company to which

the balance sheet relates and the date of the report like settlement of tax liabilities, depression in market value of investments, institution of cases by or against the company, sale or purchase of capital assets or destruction of any assets etc.

Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company’s operations in future

There were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company’s operations in future.

Internal control systems and their adequacy

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board and to the Chairman.

The management of the Company evaluates the efficiency and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies of the Company. Based on the assessment, the management undertakes corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations with corrective actions thereon are presented to the Audit Committee of the Board.

Subsidiaries/ Joint Ventures

The Company does not have Subsidiary or Joint Ventures.

Fixed deposit

The Company has not accepted deposits from Public and there were no outstanding deposits payable by the Company.

Related Party Transactions

During the financial year ended 31st March 2021, all transactions with the Related Parties as defined under the Companies Act, 2013 read with Rules framed thereunder were in the ordinary course of business and at arm’s length basis. Your Company does not have a ‘Material Subsidiary’ as defined under Regulation 16(1)(c) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 [‘Listing Regulations’].

All Related Party Transactions of your Company had prior approval of the Audit Committee and the Board of Directors, as required under the Listing Regulations. There has been no materially significant Related Party Transactions having potential conflict with the interest of the Company during the year under review.

All Related Party Transactions entered into by your Company were in the ordinary course of business and also on an arm’s length basis, therefore details required to be provided in the prescribed Form AOC - 2 is not applicable to the Company. Necessary disclosures required under the Ind AS 24 have

Annual Report 2020-21

12

V. B. Desai Financial Services Limited

been made in Notes to the Financial Statements for the year ended on 31st March, 2021.

Auditors & auditor’s repor t

The Members of the Company at the 32nd Annual General Meeting held on 22[nd ] September 2018, have approved the appointment of M/s. N.S. Shetty & Co., Chartered Accountants as Statutory Auditors of the Company for a period of five (5) years to hold office from the conclusion of the 32[nd ] Annual General Meeting till the conclusion of 37th AGM of the Company to be held in the year 2023, subject to ratification of their appointment by the Members at every AGM. Further, in terms of Companies (Amendment) Act, 2017 notified w.e.f May 7, 2018, the requirement of Section 139(1) of Companies Act, 2013 stands omitted and the ratification of appointment of the Statutory Auditor at every AGM is not required.

The Report given by the Auditors on the financial statements of the Company forms part of this Annual Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Report. The Notes on Financial Statements referred to in the Auditor’s Report are self-explanatory and do not call for any further comments.

Conservation of energy, technology absorbtion etc.

The particulars of conservation of Energy, Technology, Absorption, foreign Exchange Earnings and outgo have not been given since the same are not applicable to the Company.

Corporate Social Responsibility Initiatives

The Company does not come under the parameters specified under Section 135 of the Companies Act, 2013, hence no Committee has constituted Committee for Corporate Social Responsibility Initiatives.

Board of Directors, Board and Audit Committee Meetings:

Your Company’s Board is duly constituted and is in compliance with the requirements of the Companies Act, 2013, the Listing Regulations and provisions of the Articles of Association of the Company. During the year under review, a total of five Meetings of the Board of Directors and four meetings of Audit Committee held and details of Meetings held during the financial year 2020-21 have been provided in the Corporate Governance Report which forms part of this Annual Report

Mr. Manoj T. Shroff and Mrs. Rachana S. Vijayakar Directors of the Company shall retire by rotation at the forthcoming Annual General Meeting and offer themselves for re-appointment. A brief profile along with necessary disclosures of retiring Directors and newly appointed Director has been annexed to the Notice convening the ensuing AGM and forms an integral part of this Annual Report. Your Board recommends reappointment of Mr. Manoj T. Shroff and Mrs. Rachana S. Vijayakar.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed in Section

149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing Regulations and there is no change in their status of Independence.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and provisions of Regulations of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015, the Board has carried out an evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Appointment & Remuneration and Stakeholder’s Grievance Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

Nomination and Remuneration Committee

The Board has on the recommendation of the Appointment and Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report.

Vigil Mechanism / Whistle Blower Policy

The Company has established a vigil mechanism to be known as the “Whistle Blower Policy” for its Directors and employees to report instances of unethical behavior, actual or suspected fraud or violation of the Company’s Code of Conduct. The aim of the policy is to provide adequate safeguards against victimization of whistle blower who avails of the mechanism and also provide direct access to the Chairman of the Audit Committee, in appropriate or exceptional cases.

The purpose of this policy is to provide a framework to promote responsible and secure whistle blowing. It protects employees willing to raise a concern about serious irregularities within 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 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. All the members of the Board and designated employees have confirmed compliance with the Code.

Policy on prevention of sexual harassment of women at workplace

The Company has adopted a Policy under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules framed thereunder. Your Company is committed to provide a safe and secure environment to its women employees across its functions and other women stakeholders, as they are considered as integral and important part of the Organization.

Annual Report 2020-21

13

V. B. Desai Financial Services Limited

An Internal Complaints Committee (ICC) with requisite number of representatives has been set up to redress complaints relating to sexual harassment, if any, received from women employees and other women associates. All employees (permanent, contractual, temporary, trainees) are covered under this policy, which also extends to cover all women stakeholders of the Company.

The following is a summary of sexual harassment complaints received and disposed off satisfactorily during the financial year ended March 31, 2021:

• Number of complaints received: Nil

• Number of complaints disposed off : NA

Particulars of loans, guarantees or investments

The Company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013. The details of the investments made by Company are given in the notes to the financial statements.

Secretarial Audit

Pursuant to provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the Company has appointed N. Hariharan & Co., Company Secretaries in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit report is annexed herewith as Annexure-A, which is self-explanatory.

Compliance with Secretarial Standards

The Board of Directors affirm that the Company has complied with the applicable Secretarial Standards issued by the Institute of Companies Secretaries of India (SS1 and SS2) respectively relating to Meetings of the Board, its Committees and the General Meetings.

Annual Return

Pursuant to the provisions of Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return of the Company as at March 31, 2021 is attached herewith and Annual Return for the previous year can be accessed at http://www.vbdesai.com

Risk Management Policy

Pursuant to Section 134(3) (n) of the Companies Act, 2013 and under the SEBI Listing Regulations, the Company has constituted a business risk management committee. The details of the Committee and its terms of reference are set out in the corporate governance report forming part of the Board report. At present the Company has not identified any element of risk which may threaten the existence of the Company.

Corporate Governance

The Report on Corporate Governance along with a certificate of compliance from the Auditors and Management Discussion and Analysis Report forms part of this Report.

Foreign Exchange Earnings and Outgo

During the year ended March 31, 2021 the Company has earned Rs. 21.78 lakhs and spent Rs. Nil in foreign currency.

Director’s responsibility statement

The Board of Directors of your Company confirms that:

• a) in the preparation of the annual accounts, the applica- ble Accounting Standards have 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 have prepared the Annual Accounts on a going concern basis; and

• e) the Directors, have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

• f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operative effectively.

Particulars of employees

The Company did not have any employee falling within the purview of Section 197 of the Companies Act, 2013 and Rule 5(2) & 5 (3) of Companies (Appointment and Remuneration of Managerial Persons Rule 2014. The percentage increase in remuneration of each Key Managerial Person (KMP) during the financial year 2019-20 and ratio of the remuneration of each KMP to the median remuneration of the employees of the Company for the financial year 2020-21 are given in Annexure B.

ACKNOWLEDGEMENT

The Directors wish to place on record their sincere appreciation for the continued co-operation by the Clients and the Shareholders of the Company.

On behalf of the Board of Directors

Samir R. Dedhia Chairman PLACE: MUMBAI DATE : June 09, 2021

Annual Report 2020-21

14

V. B. Desai Financial Services Limited

Annexure A to the Directors Report

Form No. MGT-9

EXTRACT OF ANNUAL RETURN

As on the financial year ended on 31/03/2021

[Pursuant to Section 92(1) of the Companies Act, 2013 and rule 11(1) of the Companies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS

i) CIN: L74120MH1985PLC037218

ii) Registration date: 21st August 1985

iii) Name of the Company: V. B. Desai Financial Services Limited

iv) Category/ Sub-category of the Company: Company limited by shares

v) Address of the Registered office and contact details: Cama Building, 1[st] Floor, 24/26, Dalal Street, Fort, Mumbai – 400 001

vi) Whether listed Company: Yes

vii) Name, Address and contact details of Registrar and Transfer Agents:

Purva Sharegistry (I) Pvt. Ltd., 9, Shiv Shakti Industrial Estate, J.R. Boricha Marg, Lower Parel (E), Mumbai- 400 011; Tel: 022-23016761

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

All the business activities contributing 10 % or more of the total turnover of the company shall be stated:-

Sr. No.	Name & description of main products/services	NIC code of the product/service	% to total turnover of the company
1	Merchant Bankingactivities	64990	93.37%
2	Other Income	64990	6.63%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANY

( No. of Companies for which information is being filled)

S.No.	Name and Address of the Company	CIN/GLN	Holding/subsidiary/ associate	% of shares held	Applicable section
	NIL

iv) SHARE HOLDING PATTERN (Equity Share Capital breakup as percentage of Total Equity)

i) Category-wise Share Holding

Annual Report 2020-21

15

V. B. Desai Financial Services Limited

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No. of Shares held at the end of the % of
No. of Shares held at the beginning of year year change
Category of Demat Phys Total % of Demat Phys Total % of total
Shareholder ical Total ical Total capital
Shar Shar
es es
A. Promoters
(1) Indian
a) Individuals/ Hindu 674566 0 674566 14.90 674566 0 674566 14.90 0
Undivided Family
b) Central Government/ 0 0 0 0.00 0 0 0 0.00 0
State Government(s)
c) Bodies Corporate 1229699 0 1229699 27.16 1229699 0 1229699 27.16 0
d) Financial Institutions/ 0 0 0 0.00 0 0 0 0.00 0
Banks
Sub Total(A)(1) 1904265 0 1904265 42.06 1904265 0 1904265 42.06 0
Foreign
a) NRI Individuals/ Other 0
Individuals) 0.00 0.00 0 0.00 0.00 0.00 0 0.00
b) Bodies Corporate 0
0.00 0.00 0 0.00 0.00 0.00 0 0.00
d) Any Others(Specify) 0
0.00 0.00 0 0.00 0.00 0.00 0 0.00
Sub Total(A)(2) 0.00 0.00 0 0.00 0.00 0.00 0 0.00 0
Total Shareholding of 0
Promoter (A)= (A)(1)+(A)(2) 1904265 0.00 1904265 42.06 1904265 0.00 1904265 42.06
B. Public shareholding
1. Institutions
a) Mutual Funds/ UTI 0
0 0 0 0.00 0 0 0 0.00
b) Financial Institutions [/ ] 0
Banks 100 0 100 0.00 100 0 100 0.00
c) Central/ State 0
Government 0 0 0 0.00 0 0 0 0.00
d) Venture Capital Funds 0
0 0 0 0.00 0 0 0 0.00
e) Insurance Companies 0
0 0 0 0.00 0 0 0 0.00
f) Foreign Portfolio 0
Investors 50216 0 50216 0.00 50216 0 50216 0.00
Sub-Total (B)(1) 0
50316 0 50316 1.11 50316 0 50316 1.11
Non-institutions
a) Bodies Corporate
i) Indian 149990 30090 180080 3.98 116747 30090 146837 3.24 0.74
Ii) Overseas 0 0 0 0 0 0
b) Individuals -i.
Individual shareholders
holding nominal share
capital up to Rs 2 lakh 1453385 360998 1814383 40.07 1431311 360098 1791409 39.56 -0.51
ii. Individual shareholders
holding nominal share
capital in excess of Rs. 2
lakh. 469735 0 469735 10.85 543850 0 543850 12.01 1.16
Any Other (specify) 0
0 0 0 0.00 0 0 0 0.00
NRI (Repat & Non Repat) -0.02
8670 0 8670 0.19 7630 0 7630 0.17
Hindu Undivided Family 78958 0 78958 1.38 62428 0 67175 1.48 0.10
Clearing Members 21483 0 21483 0.65 29296 0 16408 0.36 -0.29
Sub-Total (B)(2) 0.01
2182321 391088 2573409 56.83 2182321 390188 2573309 56.84
Total Public
Shareholding (B)=
(B)(1)+(B)(2) 2232637 391088 2623725 57.94 2232637 390188 2623625 57.95 0.01
TOTAL (A)+(B) 0
4136802 391088 4527890 100.00 4116439 390188 4527890 100.00
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Annual Report 2020-21

16

V. B. Desai Financial Services Limited

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C. Shares held by
Custodians for
GDR & ADRs 0.00 0 0 0.00 0.00 0 0 0.00
GRAND TOTAL
(A)+(B)+(C) 4136802 391088 4527890 100.00 4116439 390188 4527890 100.00
(ii) Shareholding of Promoters
Shareholding at the beginning of Shareholding at the end of %
the year the year change
Number of % of % of Number % of % of in share
shares held total Shares of total Share holding
Shares Pledged shares Shares s during
S.. of the to total held Pledg the year
No. Name of the shareholder Co. shares ed
1 PRADIP R. SHROFF 4252 0.09 0.00 4252 0.09 0 0
2 JITENDRA R. SHROFF HUF 90988 2.01 0.00 90988 2.01 0 0
3 JITENDRA R. SHROFF 15310 0.34 0.00 15310 0.34 0 0
4 MUKESH THAKORLAL SHROFF 158946 3.51 0.00 173367 3.83 0 0.32
5 DHARTI J SHROFF 261041 5.77 0.00 261041 5.77 0 0
6 RAKSHA PRADIP SHROFF 7792 0.17 0.00 7792 0.17 0 0
7 THAKORLAL R. SHROFF 14421 0.32 0.00 0 0.00 0 -0.32
8 GIRISH RATILAL SHROFF 1200 0.03 0.00 1200 0.03 0 0
9 JYOTI GIRISH SHROFF 2950 0.07 0.00 2950 0.07 0 0
10 RAJ PRADIP SHROFF 800 0.02 0.00 800 0.02 0 0
11 RAJ PRADIP SHROFF HUF 27923 0.62 0.00 27923 0.62 0 0
12 PURVI RAJ SHROFF 12000 0.27 0.00 12000 0.27 0 0
13 HEMENDRA J. SHROFF 3006 0.09 0.00 3006 0.07 0 0
14 HEMENDRA J. SHROFF HUF 1200 0.00 0.00 1200 0.02 0 0
15 MANOJ THAKORLAL SHROFF 800 0.02 0.00 800 0.02 0 0
16 SATYAM P. SHROFF HUF 25189 0.56 0.00 25189 0.56 0 0
17 PINKI MUKESH SHROFF 3000 0.07 0.00 3000 0.07 0 0
18 ALPA J. SHROFF 38217 0.84 0.00 38217 0.84 0 0
19 BINDU S MARFATIA 5431 0.12 0.00 5431 0.12 0 0
20 AARAYAA FINSTOCK PVT LTD 9257 0.21 0.00 9257 0.20 0 0
21 DESAI INVESTMENTS PVT. LTD. 771607 17.04 0.00 771607 17.04 0 0
22 NEPTUNE STEEL STRIPS LIMITED 104520 2.31 0.00 104520 2.31 0 0
23 SOM HOLDING & TRAD CO. PVT LTD. 194215 7.60 0.00 194215 4.29 0 0
24 DESAI INDUSTRIAL FINANCE PVT. LTD. 150000 3.31 0.00 150000 3.31 0 0
(iii) Change in Promoters’ Shareholding (please specify, if there is no change)
Shareholding at the beginning of Shareholding at the end of %
the year the year change
Number of % of % of Number % of % of in share
shares held total Shares of total Share holding
Shares Pledged shares Shares s during
S.. of the to total held Pledg the year
No. Name of the shareholder Co. shares ed
1 MUKESH THAKORLAL SHROFF 158946 3.51 0.00 173367 3.83 0 0.32
2 THAKORLAL RATILAL SHROFF 14421 0.32 0.00 0 0.00 0 -0.32
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(iv) Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):

S.N o.		Shareholding at the beginning of the year	Inter-se transfer &Buy/ sold & during the year	Cumulati ve Sharehol ding during year	At the end of year on

Annual Report 2020-21

17

V. B. Desai Financial Services Limited

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No. of % of No. of No. of No. of % of
shares total shares shares Shares total
shares shares
1 DEV ASHOK KARVAT 93738 2.07 0 93738 93738 2.07
2 SRIHARI SIRDESHPANDE 76700 1.69 0 76700 76700 1.69
3 KRUTI CAPITAL SERVICES PVT. LTD. 65000 1.44 0 65000 65000 1.44
4 SHREEKANT JAVALGEKAR 57000 1.26 0 57000 57000 1.26
5 SPARROW ASIA DIVERSIFED 50216 1.11 0 50216 50216 1.11
OPPORTUNITIES FUND
6 HARSHA HITESH JAVERI 43000 0.94 0 43000 43000 0.94
7 HITESH RAMJI JAVERI 39550 0.87 0 39550 39550 0.87
8 ASHA SHREEKANT JAVALGEKAR 37825 0.84 0 37825 37825 0.84
9 MILIND KRISHNAJI KULKARNI 37000 0.82 0 37000 37000 0.82
10 JIGNASHA GIRISH DAMANIA 34000 0.75 0 34000 34000 0.75
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(v) Shareholding of Directors and Key Managerial Personnel:

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S. Shareholding at the Buy/ sold Cumulative At the end of year
N beginning of the year during Shareholding
o. the year during year
No. of % of total No. of No. of shares No. of % of total
shares shares shares Shares shares
1 PRADIP RATILAL SHROFF 4252 0.09 0 4252 4252 0.09
2 MANOJ THAKORLAL SHROFF 800 0.02 0 800 800 0.02
3 HEMENDRA J. SHROFF 4200 0.09 0 4206 4206 0.09
4 KAMLESH M. GAGAVANI 506 0.02 0 506 506 0.02
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V. INDEBTEDNESS

Indebtedness of the Company including interest outstanding/accrued but not due for payment

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Secured Loans Unsecured Deposits Total
excluding deposits Loans Indebtedness
Indebtedness at the beginning of the financial year
i) Principal Amount 0 0 0 0
ii) Interest due but not paid 0 0 0 0
iii) Interest accrued but not due 0 0 0 0
Total (i+ii+iii) 0 0 0 0
Change in Indebtedness during the financial year
· Addition 0 0 0 0
· Reduction 0 0 0 0
Net Change 0 0 0 0
Indebtedness at the end of the financial year
i) Principal Amount 0 0 0 0
ii) Interest due but not paid 0 0 0 0
iii) Interest accrued but not due 0 0 0 0
Total (i+ii+iii) 0 0 0 0
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VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL-

- A. Remuneration to Managing Director, Whole time Directors and/or Manager:

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SN. Particulars of Remuneration Name of Total Amount
MD/WTD
Mr. Pradip R.
Shroff
1 Gross salary
(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, Rs.4,22,400/- Rs. 4,22,400/-
1961
(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 0 0
(c) Profits in lieu of salary under section 17(3) Income- tax Act, 1961 0 0
2 Stock Option 0 0
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Annual Report 2020-21

18

V. B. Desai Financial Services Limited

	V. B. Desai Financial Services Limited
3	Sweat Equity	0	0
4	Commission-as % of profit &-others, specify…	0	0
5	Others, please specify	0	0
	Total (A)	Rs. 4,22,400/-	Rs. 4,22,400/-
	Ceiling as per the Act	Rs. 60,00,000/-	Rs. 60,00,000/-

B. Remuneration to other directors

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SN Particulars of Remuneration Name of Directors Total
. Amount
Samir Manoj Hemendra Rachana Nilesh
Dedhia Shroff Shroff Vijayakar Doshi
1 Independent Directors
Fee for attending board committee meetings 40,000 0 0 0 40,000 80,000
Commission 0 0 0 0 0 0
Others, please specify 0 0 0 0 0 0
Total (1) 40,000 0 0 0 40,000 80,000
2 Other Non-Executive Directors
Fee for attending board committee meetings 0 25,000 20,000 25,000 0 70,000
Commission 0 0 0 0 0 0
Others, please specify 0 0 0 0 0 0
Total (2) 0 25,000 20,000 25,000 0 70,000
Total (B)=(1+2) 40,000 25,000 20,000 25,000 40,000 1,50,000
Total Managerial Remuneration 4,22,400 4,22,400
Overall Ceiling as per the Act 60,00,000
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C. Remuneration to key managerial personnel other than MD/Manager/WTD

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SN Particulars of Remuneration Key Managerial Personnel
CEO CS CFO Total
1 Gross salary Nil 220800 924000 1144800
(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 0 0 0 0
1961
(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 0 0 0 0
(c) Profits in lieu of salary under section 17(3) Income-tax Act, 1961 0 0 0 0
2 Stock Option 0 0 0 0
3 Sweat Equity 0 0 0 0
4 Commission – as % of profit 0 0 0 0
others, specify… 0 0 0 0
5 Others, please specify 0 0 0 0
Total 0 220800 924000 1144800
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- VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES NIL

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Type Section of the Brief Details of Penalty / Authority Appeal made,
Companies Act Description Punishment/ Compounding [RD / NCLT/ if any (give
fees imposed COURT] Details)
(A.) COMPANY (B) DIRECTORS (C) OTHER OFFICERS IN DEFAULT
Penalty
Punishment
Compounding
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Annual Report 2020-21

19

V. B. Desai Financial Services Limited

Annexure A of Directors Report – Form MR-3

SECRETARIAL AUDIT REPORT for the financial year ended 31st March 2021

[Pursuant to section 204(1) of the Companies Act, 2013 and rule No.9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]

To the Members, V.B. Desai Financial Services Limited

We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by V.B. Desai Financial Services Limited (hereinafter called the company). Secretarial Audit was conducted in a manner that provided me a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing my opinion thereon.

Based on our verification of the V.B. Desai Financial Services Limited’s books, papers, minute books, forms and returns filed and other records maintained by the company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, we hereby report that in our opinion, the company has, during the audit period covering the financial year ended on 1st April 2020 to 31st March, 2021 complied with the statutory provisions listed hereunder and also that the Company has proper Board- processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

We have examined the books, papers, minute books, forms and returns filed and other records maintained by V.B. Desai Financial Services Limited (“the Company”) for the financial year ended on 31st March 2021, according to the provisions as applicable to the Company:

• (i) The Companies Act, 2013 (the Act) and the rules made thereunder;

• (ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made thereunder;

• (iii) The Depositories Act, 1996 and the Regulations and Byelaws framed thereunder;

• (iv) Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings;

• (v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’):-

• (a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations 2011;

• (b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015;

• (c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations 2009/2018; (Not applicable during the year)

• (d) The Securities and Exchange Board of India (Share Based Employees Benefits) Regulations, 2014; (Not applicable during the year)

• (e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008; (Not applicable during the year)

• (f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client;

• (g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; (Not applicable during the year)

• (h) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 2018; (Not applicable during the year)

• (i) SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015.

We further report that the Compliance by the Company of the undermentioned Acts and Rules have not been reviewed and we have relied on the representations made by the Company, its Officers and Reports issued by the Statutory Auditors.

• a) Applicable Financial laws like Direct and Indirect tax laws, GST and others detailed under Tax Legislations

• b) The Employees Provident Fund & Miscellaneous Provisions Act, 1952

• c) Employees State Insurance Act, 1948

• d) Payment of Bonus Act, 1965 and the payment of Bonus Rules, 1965

• e) Payment of Gratuity Act, 1972;

• f) Contract Labor (Regulation and Abolition) Central Rules, 1971

• g) Income Tax 1961 and Rules made thereunder

• h) Service Tax Act, 1994 and Rules made thereunder

• i) Shops and Establishment Act of Maharashtra.

We have also examined compliance with the applicable clauses of the:

• (i) Secretarial Standards issued by The Institute of Company Secretaries of India.

• (ii) The Listing Agreements entered into by the Company with BSE Limited read with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

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V. B. Desai Financial Services Limited

Based on the above examination and considering the relaxations granted by the Ministry of Corporate Affairs and Securities and Exchange Board of India warranted due to the spread of the COVID-19 pandemic, we hereby report that, during the period under review the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards, etc. mentioned above subject to the following observations:

Observations / audit qualification, reservation or remarks: Nil

We further report that: The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non- Executive Directors and Independent Directors. The changes in the composition of the Board of Directors that took place during the period under review were carried out in compliance with the provisions of the Act.

Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advance, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting. Majority decision is carried through while the dissenting members’ views are captured and recorded as part of the minutes.

As per the minutes of the Board duly recorded and signed by Chairman, the decisions of the Board were unanimous and no dissenting views have been recorded.

We further report that there are adequate systems and processes in the company commensurate with the size and operations of the company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.

Specific observations / qualification, reservation or adverse remarks in respect of the Board Structures / system and processes relating to the Audit period - Nil

We further report that during the audit period the Company has not incurred any specific event/ action except as stated above that can have a major bearing on the Company’s affairs in pursuance of the above referred laws, rules, regulations, guidelines, standards etc.

Annexure A to Secretarial Audit Report

To the Members, V.B. Desai Financial Services Limited

Our report of even date is to be read along with this letter.

1. Maintenance of Secretarial record is the responsibility of the management of the Company. Our responsibility is to express as opinion on these secretarial records based on our audit.

2. We have followed the audit practices and process as were appropriate to obtain reasonable assurance about the correctness of the contents of the Secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial records. I believe that the processes and practices, followed provide a reasonable basis for my opinion.

3. We have not verified the correctness and appropriateness of financial records and books of accounts of the Company.

4. Wherever required, we have obtained the management representation about the compliance of laws, rules and regulations and happening of events etc.

5. The compliance of the provisions of Corporate and other applicable laws, Rules, Regulations, standards are the responsibility of management. Our examination was limited to the verification of procedures on test basis.

6. The Secretarial Audit report is neither an assurance as to the future viability of the Company nor of the efficiency or effectiveness with which the management has conducted the affairs of the Company.

7. N. HARIHARAN & Co. Practicing Company Secretaries N. Hariharan Proprietor Membership No. 559 Certificate of Practice No. 7119

Place: Navi Mumbai Date: June 07, 2021

N. HARIHARAN & Co., Practicing Company Secretaries N. Hariharan Proprietor Membership No. 559 Certificate of Practice No. 7119

Place: Navi Mumbai Date: June 07, 2021

This report is to be read with our letter of even date which is annexed as Annexure ’A’ and forms an integral part of this report.

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• iii. The % increase in the median remuneration of employees in the financial year : 0%

Annexure B

The ratio of the remuneration of each director to the median employee’s remuneration and other details in terms of subsection 12 of Section 197 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

• iv. The number of permanent employees on the rolls of the Company : 5

• v. 1. Average percentage increase already made in the salaries of employees other than the managerial personnel in the last financial year. 0%

• i. The ratio of the remuneration of Managing Director to the median remuneration of the employees of the Company for the financial year:

• Average percentage increase in the managerial remuneration in the last financial year: 0%

Name of the Director	Designation	Ratio to median remuneration of the employees*
Mr. PradipR. Shroff	ManagingDirector	0

  - vi. It is hereby affirmed that the remuneration is as per the Remuneration Policy of the Company.

• vii. The Company has not increased remuneration to its employees during the year under review.

• ii. The % increase in remuneration of Managing Director, Chief Financial Officer & Company Secretary in the financial year:

On behalf of the Board of Directors

financial year:
Name of the Director	Designation	Ratio to median remuneration of the employees*
Mr. PradipR. Shroff	ManagingDirector	0%
Mr. Shashank S. Vijayakar	Chief Financial Officer	0%
Mr. Kamlesh M. Gagavani	Company Secretary	0%

Samir R. Dedhia Chairman

Place: Mumbai

Date: June 09, 2021

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REPORT ON CORPORATE GOVERNANCE

1. COMPANY’S PHILOSOPHY ON CORPORATE GOVERNANCE :

The Company has adopted good corporate governance practices and ensures compliance with all relevant laws and regulations. It has lead to the satisfaction and transparency to the shareholders. Company’s philosophy is concerned with ethics, values, morals and social responsibility of the Company. The Company remains accountable to shareholders and other beneficiaries for their actions. The Company conducts its activities in a manner that is fair and transparent and perceived to be such by others. The Board of Directors of the Company has adopted the Code of Conduct for its members and senior management executives.

2. BOARD OF DIRECTORS

a) Composition

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Name Category Designation
Mr. Samir R. Dedhia Independent Chairman
Mr. Pradip R. Shroff Executive-Non Independent Managing Director
Mr. Manoj T. Shroff Non-Independent Director
Mr. Hemendra J. Shroff Non-Independent Director
Mrs. Rachana S. Vijayakar Non-Independent Director
Mr. Nilesh R. Doshi Independent Director
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The composition of the Board of Directors is in accordance with the provisions of and provisions of Regulations of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015. Non-Executive Independent Directors of your Company have no pecuniary relationship or any transaction with your Company.

b) Board Meetings

The meeting of the Board of Directors is scheduled well in advance and generally held at the Company’s Registered Office. Considering the relaxations granted by the Ministry of Corporate Affairs and Securities and Exchange Board of India warranted due to the spread of the COVID-19 pandemic, the Board Meetings and Committee Meetings were also held through video conference mode for those Directors could not attend physically. The notice and the detailed agenda are sent well in advance to all the Directors. During the financial year ended on 31/3/2021, four board meetings were held on 30/06/2020, 14/09/2020,11/11/2020 & 10/02/2021.

The attendance of each Director at the Board Meetings and last Annual General Meeting (AGM) and number of other Directorship and Membership/Chairmanship of Committee are as follows:

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Name of the Director Attendance No. of directorship/and Committee Membership / Sitting fees
Particulars Chairmanship in other Companies paid for
Board Last Directorship Directorship Committee Committee attending
Meetings AGM in private in public Memberships Chairmanships Board &
Companies/ Companies Committee
LLP Meeting
Mr. Samir R. Dedhia 4 Yes 0 0 0 0 Rs. 40000
Mr. Pradip Shroff 4 Yes 1 8 0 0 Rs. 0
Mr. Manoj Shroff 4 Yes 4 3 0 0 Rs. 25000
Mr. Hemendra J. Shroff 4 Yes 8 2 0 0 Rs. 20000
Mrs. Rachana S. 4 Yes 2 3 0 0 Rs. 25000
Vijayakar
Mr. Nilesh R. Doshi 4 Yes 1 3 2 4 Rs. 40000
Total Rs. 150000
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c) Brief Note on the Directors seeking appointment/ re-appointment at the 35th Annual General Meeting:

In Compliance with and provisions of Regulations of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015, brief resume, expertise and details of other directorship, membership in committees of Directors of other companies and shareholding in the Company of the Directors proposed to be re-appointed are given in the Annexure A of forming part of Notice.

c) Remuneration of Directors

The Company has during the year paid Rs. 4.22 lakhs being remuneration to Mr. Pradip R. Shroff, the Managing Director of

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the Company. At present Independent Directors are not paid any remuneration except sitting fees for attending Board and Committee Meetings. The sitting fees paid to the Directors are as given above.

3. AUDIT COMMITTEE

The scope of activities and powers of Audit Committee includes the areas prescribed under the Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015, and section 177 of the Companies Act, 2013. The Board has set up Audit Committee having three Directors viz. Mr. Samir R. Dedhia as Chairman and Mr. Nilesh R. Doshi and Mr. Pradip R. Shroff, members of the Committee. During the financial year under review, 4 meetings were held on 30/06/2020, 14/09/2020,11/11/2020 & 10/02/2021.

4. NOMINATION AND REMUNERATION COMMITTEE

In compliance with the provisions of Section 178 of the Companies Act, 2013 and provisions of Regulations of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 with the Stock Exchange, the Nomination and Remuneration Committee consists Mr. Nilesh R Doshi as the Chairman and Mr. Samir R. Dedhia and Mrs. Rachana S. Vijayakar are the other members of the Committee during the financial year 2019-20.

The terms of reference of the Nomination and Remuneration Committee cover all the areas mentioned under and provisions of Regulations of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 and Section 178 of the Companies Act, 2013. The broad terms of reference of the Nomination and Remuneration Committee therefore include recommending a policy relating remuneration and employment terms of Managing Director and senior management personnel, adherence to the remuneration / employment policy from time to time as finally approved by the Board of Directors. Preliminary evaluation of every Director’s performance, Board diversity, compliance of the Code for Independent Directors referred to in Schedule IV of the Companies Act, 2013, compliance with the Company’s Code of Conduct by Directors and employees of the Company, reporting of non-compliances to the Board of Directors, recommending draft of the report required under Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, monitor loans to employees and any other matters which the Board of Directors may direct from time to time.

5. STAKEHOLDERS GRIEVANCE COMMITTEE

The Stakeholders’ Grievance Committee comprises of 3 Directors viz. Mr. Manoj T. Shroff, the non-executive Director is the Chairman and Mr. Pradip R. Shroff and Mrs. Rachana S. Vijayakar are the members of the Committee. The Committee reviews the status of Investor Grievances and recommends measure to improve in solving Investor Services. During the year there were 4 complaints received from shareholders and there is no complaint which has remained un-addressed.

6. RISK MANAGEMENT COMMITTEE

The Board of Directors has constituted “Risk Management Committee” as required under SEBI Listing Regulations. The Committee is responsible for risk identification, evaluation and mitigation and to set up process for risk management plan. The Risk Management Committee has reconstituted on 09-06-2021 with Mr. Pradip R. Shroff as the Chairman and Mr. Hemendra J. Shroff, and Mr. Nilesh R. Doshi as Member of the Committee.

7. PERFORMANCE EVALUATION OF THE BOARD

Based on the inputs on aspects under the provisions of the Companies Act, 2013 and under SEBI Listing Regulations, such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance, independence of judgement, safeguarding the interest of the Company etc. received from each Directors specifically Executive, Non-Executive and Independent Directors, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Audit, Appointment and Remuneration Committees.

8. GENERAL BODY MEETINGS

Date	AGM/ EGM	Location	Time	No. of Special Resolution
18.09.2020	AGM	Through video conferencing (VC) and other audio visual means (OAVM)	11.30 am	1
07.09.2019	AGM	Registered Office at Cama Building, 1stFloor, 24/26, Dalal Street,Fort,Mumbai - 400 001	11.00 a.m	3
22.09.2018	AGM	Registered Office at Cama Building, 1stFloor, 24/26, Dalal Street,Fort,Mumbai - 400 001	11.00 a.m	1

During the last year no business had been conducted through postal ballot.

9. DISCLOSURES:

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• a) There was no transaction of material nature with the Promoters, Directors, Management or their relatives during the financial Year of the Company, which could have potential conflict with the interests of the Company at large.

• b) During the last three years, there were no strictures or penalties imposed either by Securities and Exchange Board of India or the Stock Exchange or any regulatory authority for non-compliance of any matter related to the capital market.

• c) No personnel have been denied access to the Chairman or members of the Audit Committee. The mechanism of Whistle Blower Policy is in place.

• d) The Company is in Compliance with the mandatory Provisions of and provisions of Regulations of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015.

• e) Code of Business Conduct and Ethics for Board of Directors and Senior Management: The Company has in place the Code of Business Conduct and Ethics for Board of Directors and Senior Management (the Code) approved by the Board of Directors. The Code has been communicated to Directors and the members of the senior management.

f) Details of utilization of funds

During the year under review, there were no Preferential Allotment or Qualified Institutional Placement as specified under Regulation 32(7A) of the Listing Regulations.

g) Fees paid to Statutory Auditors

The total fees incurred by the Bank and its subsidiaries on a consolidated basis, for services rendered by Statutory auditors and its affiliates entities, is given below:

Audit fees Rs. 60,000

Statutory Certificates fees Rs. Nil

10. MEANS OF COMMUNICATION

• a) The financial results of all four quarters were published in The Free Press Journal and Navshakti dailies. These were not sent individually to the shareholders.

• b) The financial results or official news are displayed on the Company’s website www.vbdesai.com

• c) There were no presentations made to the institutional investors or to the analysts

• d) The Management Discussion and Analysis Report forms a part of this Annual Report

11. GENERAL INFORMATION FOR SHAREHOLDERS

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I AGM: Date and Time Friday, 17th September, 2021 at 11.00 a. m
Ii Financial Year 1 [st ] April 2020 - 31 [st ] March, 2021
Iii Record Date for e-voting and AGM 10-09-2021
Iv Dividend payment date No dividend recommended.
V Listing on Stock Exchange BSE Limited (BSE)
Annual Listing fees have been paid to the Stock Exchanges for the year 2021-22
Vi Stock Code BSE Limited – 511110
Vii ISIN of the Company for dematerialisation INE848D01018
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Market price date and performance in comparison to BSE Sensex during each month in 2020 -2021 on BSE Limited

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Month High – Rs. Low – Rs. BSE Sensex
April 2020 3.25 2.23 33717.62
May 2020 2.56 2.02 32424.10
June 2020 3.30 2.45 34915.80
July 2020 4.07 3.15 37606.89
August 2020 3.14 2.61 38628.29
September 2020 3.24 2.68 38067.93
October 2020 3.80 2.80 39614.07
November 2020 5.29 3.69 44149.72
December 2020 6.10 4.03 47751.33
January 2021 5.50 4.23 46285.77
February 2021 4.96 3.88 49099.99
March 2021 4.07 3.25 49509.15
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V. B. Desai Financial Services Limited

Registrars & Transfer Agents

Purva Sharegistry (India) Pvt. Ltd.

9, Shiv Shakti Industrial Estate,

J.R.Boricha Marg, Lower Parel (East), Mumbai – 400 011.

Tel: 022-23016761/ 23018261; Email: support@purvashare.com; website: www.purvashare.com

Share Transfer System

All requests received for transfer of shares in physical form are processed by the Registrar and Transfer Agents and are approved by Stakeholders’ Grievance Committee (earlier Share Transfer Committee). The share transfers are registered and returned within 15 days from the date of receipt, subject to documents being valid and complete in all respects.

Distribution of shareholding as on 31[st] March 2021

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No. of Equity Shares Held No. of Shareholders No. of Shares % Total
1 – 500 4,076 612289 13.52
501 – 1000 263 204307 4.51
1001 – 2000 124 181220 4.00
2001 – 3000 39 100301 2.22
3001 – 4000 41 144215 3.19
4001 – 5000 18 85391 1.89
5001 – 10000 49 345813 7.64
10001 and above 48 2854354 63.04
TOTAL 4,658 4527890 100.00
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Shareholding pattern as on 31[st ] March 2021

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SR. NO CATEGORY NO. OF SHARES % OF SHARE-
HELD HOLDING
1. Promoters Holding
-Indian Promoters and Persons Acting in concert 1904265 42.06
2. Mutual Funds -- --
3. Banks & Financial Institutions/FPI 50316 1.11
4. Bodies Corporates/LLP 146837 3.24
5. NRIs/OCBs 7630 0.17
6. Clearing Members 16408 0.37
7. Hindu Undivided Family 67175 1.48
8. Indian Public 2335259 51.57
TOTAL 4527890 100.00
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Dematerialization of shares

As on 31[st ] March 2021, 91.42% of the Company’s total shares represented by 41,37,702 shares were held in dematerialized form.

Outstanding GDR/Warrants/ Convertible Instruments

The Company has no outstanding GDR/ Warrants/ Convertible Instruments.

Address for correspondence

V.B. Desai Financial Services Limited Cama Building, 1[st] Floor 24/26, Dalal Street, Fort, Mumbai – 400 001. Tel: 022-40770777; email: investor@vbdesai.com

On behalf of the Board of Directors

Pradip R. Shroff Managing Director

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V. B. Desai Financial Services Limited

ANNEXURE TO CORPORATE GOVERNANCE REPORT

Declaration regarding affirmation of Code of Conduct

In terms of the requirements of The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015, this is to confirm that all the members of the Board and the senior management personnel have affirmed compliance with the Code of Conduct for the year ended 31[st ] March, 2021.

Mumbai Dated: June 09, 2021

Pradip R. Shroff Managing Director

COMPLIANCE CERTIFICATE

[Regulation 17(8) of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015]

The Board of Directors

V.B. Desai Financial Services Limited

• A. We have reviewed financial statements and the cash flow statement for the year and that to the best of our knowledge and belief:

• (1) these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;

• (2) these statements together present a true and fair view of the Company’s affairs and are in compliance with existing accounting standards, applicable laws and regulations.

• B. There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year which are fraudulent, illegal or violative of the Company’s code of conduct.

• C. We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have evaluated the effectiveness of internal control systems of the Company pertaining to financial reporting and we have disclosed to the auditors and the audit committee, deficiencies in the design or operation of such internal controls, if any, of which we are aware and the steps we have taken or propose to take to rectify these deficiencies.

• D. We have indicated to the Auditors and the Audit committee that there is no:

• (1) significant changes in internal control over financial reporting during the year;

• (2) significant changes in accounting policies during the year and that the same have been disclosed in the notes to the financial statements; and

• (3) instances of significant fraud of which we have become aware and the involvement therein; if any, of the management or an employee having a significant role in the Company’s internal control system over financial reporting.

For V.B. Desai Financial Services Limited

Pradip R. Shroff Shashank S. Vijayakar Managing Director Chief Financial Officer

Date: June 09, 2021

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V. B. Desai Financial Services Limited

Practicing Company Secretary’s Certificate on Compliance of Conditions of Corporate Governance

To the members of V.B. Desai Financial Services Limited

We have examined the compliance of conditions of Corporate Governance by V.B. Desai Financial Services Limited (the Company), for the financial year ended on 31stt March 2021, as stipulated under the relevant clauses of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The compliance of conditions of Corporate Governance is the responsibility of the Management. My examination was limited to a review of procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us and based on the representations made by the Directors & the Management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company.

N. HARIHARAN & Co., Practicing Company Secretaries N. Hariharan, Proprietor Membership No. 559 Certificate of Practice No. 7119

Place: MUMBAI Date: June 07, 2021

Practicing Company Secretary’s Certificate Under Sub-Para 10(I) of Part C of Schedule V of SEBI (LODR), Regulations, 2015

To the Members of V.B. Desai Financial Services Limited

We have examined the relevant registers, records, forms, returns and disclosures received from the Directors of V.B. Desai Financial Services Limited having CIN: L74120MH1985PLC037218 and having registered office at Cama Building, 1[st ] Floor, 24/26, Dalal Street, Fort, Mumbai – 400 001, Maharashtra (hereinafter referred to as ‘the Company’), produced before us by the Company for the purpose of issuing this Certificate, in accordance with Regulation 34(3) read with Schedule V Para-C Sub clause 10(i) of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

In our opinion and to the best of our information and according to the verifications (including Directors Identification Number (DIN) status at the portal www.mca.gov.in) as considered necessary and explanations furnished to us by the Company & its officers, we hereby certify that none of the Directors on the Board of the Company as stated below for the Financial Year ending on 31[st ] March, 2021 have been debarred or disqualified from being appointed or continuing as Directors of companies by the Securities and Exchange Board of India, Ministry of Corporate Affairs.

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Sr. No. Name of the Director DIN Date of appointment
1. Mr. Samir Ramjibhai Dedhia 06864567 30-05-2014
2. Mr. Pradip Ratilal Shroff 00286291 28-06-2008
3. Mr. Manoj Thakorlal Shroff 00330560 01-06-2004
4. Mr. Hemendra Jitendra Shroff 00286509 07-05-2014
5. Mrs. Rachna Shashank Vijayakar 03317373 30-05-2014
6. Mr. Nilesh Ramanlal Doshi 00249715 23-04-2019
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Ensuring the eligibility of for the appointment/continuity of every Director on the Board is the responsibility of the management of the Company. Our responsibility is to express an opinion on these based on our verification. This certificate is neither an assurance as to the future viability of the Company nor of the efficiency or effectiveness with which the management has conducted the affairs of the Company.

N. HARIHARAN & Co., Practicing Company Secretaries N. Hariharan, Proprietor Membership No. 559 Certificate of Practice No. 7119

Place: MUMBAI Date: June 07, 2021

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V. B. Desai Financial Services Limited

MANAGEMENT DISCUSSION AND ANALYSIS

Overview

Management discussion and analysis of financial condition and results of operations include forward looking statements based on certain assumptions and expectations of future events. The Company cannot assure that these assumptions and expectations are accurate. Although the management has considered future risks as part of the discussions, future uncertainties are not limited to the management perceptions.

Securities and Exchange Board of India (SEBI) regulates capital market through the process of registering intermediaries and framing rules and regulations for each activity involving capital market functions. Your Company is one of the capital market intermediaries registered with SEBI as Category I Merchant Banker. The requirement of having trained personnel and infrastructure at various registered intermediaries is being implemented by SEBI which is helping the intermediaries to remain up-to-date in tune with global market conditions.

Industry structure and developments

The main activities of the Company are Merchant Banking and related activities. In the Merchant Banking activities, the Company mainly engaged in Company Share Valuation, ESOP Valuation, ESOP Advisory, merger and acquisition, to act as Manager in Buy back of shares and in Acquisition, Takeover of Listed Companies and in Initial Public Offerings. A positive economic and a conducive business and regulatory environment is expected to provide growth opportunities for Merchant Banking activities. The Company will continue to capitalize on Merchant Banking, Advisory Services and fund-raising opportunities by the growing economic needs of the industries.

Opportunities and Threats

A positive economic and a conducive business and regulatory environment is expected to provide growth opportunities for Merchant banking business. Your Company being a Financial Services Company (Merchant Banking and related activities), the Company seeks opportunities in Share Valuation, ESOP Valuation, ESOP Advisory, merger and acquisition, to act as Manager in Buy back of shares and in Acquisition, Takeover of Listed Companies and in Initial Public Offerings and in other capital market activities. The recement amendment in Rule 11UA allows only Merchant Bankers to calculate the fair value of shares issued by unlisted companies for the purpose of Section 56(2)(viib). This will provide significant business opportunities for the Company.

Segment wise performance

The Company has one segment i.e Merchant Banking and related services; therefore, segment wise reporting has not given. The income of the Company comprises of fees received on advisory services in the Merchant Banking, Valuation and ESOP Advisory.

Outlook

The financial services sector has shown rapid growth with an improvement in the economic environment. Company will continue to capitalize the growing economic opportunities and looks forward in view of the reposed confidence of Investors in the capital market. With strengthening of the economy and stable economic environment, the Indian capital market is expected to perform well. The management will continue to focus on Merchant Banking activities and Advisory Services and endeavor to deliver best solutions to the clients to their satisfaction.

Risks and Concerns

Risk is an integral part of the business. Today financial services companies operate in increasingly complex, competitive and continuously evolving legislative and regulatory environment due to increasing globalisation, integration of world markets, newer and more complex products & transactions and an increasingly stringent regulatory framework. With its past long experience in financial service industry, dedicated and trained professionals the Company counter the threats to the best possible extent in its business operation.

Internal control system

The Company has a sound and adequate system of internal controls to monitor and control all the activities. The Company complies with all internal control policies and procedures as also other regulatory requirements.

On behalf of the Board of Directors PLACE: MUMBAI Samir R. Dedhia DATE : June 09, 2021 Chairman

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V. B. Desai Financial Services Limited

INDEPENDENT AUDITOR’S REPORT

To the Members of V. B. Desai Financial Services Limited

Report on the Financial Statements

Opinion

We have audited the accompanying financial statements of V. B. Desai Financial Services Limited (“the Company”) which comprise the Balance Sheet as at March 31, 2021, the Statement of Profit and Loss(including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on that date, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information (hereinafter referred to as “the financial statements”).

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Companies Act, 2013(“the Act”)in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards (Ind AS) specified under section 133 of the Act and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2021, and Profit including Other Comprehensive Income, changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon. Based on the circumstances and facts of the Audit, there are no key audit matters to be reported.

Information Other than the Financial Statements and Auditor’s Report thereon

The Company’s Board of Directors is responsible for the preparation of the other information. The other information

comprises the information included in the Annual Report, but does not include the financial statements and our auditor’s report thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management for the Financial Statements

The Company’s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance, total comprehensive Income, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Ind AS specified under section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors are also responsible for overseeing the company’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from

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V. B. Desai Financial Services Limited

material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with Standards on Auditing, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal financial controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including

any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”) issued by the Central Government in terms of Section 143(11) of the Act, we give in “Annexure A” a statement on the matters specified in paragraph 3 and 4 of the Order.

2. As required by Section 143 (3) of the Act, based on our audit we report that:

3. a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

4. b. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

5. c. The financial statements dealt with by this report are in agreement with the books of accounts.

6. d. In our opinion, the aforesaid financial statements comply with the Ind AS specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

7. e. On the basis of the written representations received from the directors of the Company as on 31 March 2021 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2021 from being appointed as a director in terms of Section 164 (2) of the Act;

8. f. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”.

9. g. As required by Section 197(16) of the Act, we report that the Company has paid remuneration to its directors during the year in accordance with the

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V. B. Desai Financial Services Limited

provision of and limits laid down under Section 197 read with Schedule V to the Act.

• h. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

• i. The company does not have any pending litigations which would impact its financial position.

• ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term

contracts. We are informed that the company did not have any pending derivative contracts.

• iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

For N S Shetty & Co. Chartered Accountants FR No. : 0110101W N. S. Shetty Place : Mumbai Partner Date : June 09, 2021 M. No. 035083

ANNEXURE - A TO THE INDEPENDENT AUDITOR’S REPORT

(Referred to in paragraph 1 under “Report on Other Legal and Regulatory Requirements’ section of our report of even date)

Based on the audit procedures performed for the purpose of reporting a true and fair view on the financial statements of the Company and taking into consideration the information and explanations given to us and the books of account and other records examined by us in the normal course of audit, and to the best of our knowledge and belief, we report that:

• (i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

• (b) The Company has a regular programme of physical verification of its fixed assets by which fixed assets are verified in a phased manner over a period of two years. In accordance with this programme, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.

• (c) On the basis of our examination of the records of the Company, the Company does not own any immovable property, hence paragraph 3(i)(c) of the Order is not applicable.

• (ii) The inventories of shares/stock lying in physical form, have been verified by the management at reasonable interval. The Company is maintaining proper records of inventories (securities). No material discrepancy was noticed between physical verification of stocks and book records. No physical verification is required in case of shares/stocks held in demat form by the Company.

• (iii) During the year the Company has granted loans, repayable on demand to the party covered in the register maintained under section 189 of the Act. The terms and conditions of the said loans are not prima facie prejudicial to the interest of the company.

• (iv) There are no transactions as referred to in section 185 of the Act. In our opinion and according to the information and explanations given to us, the Company has complied

with the provisions of 186 of the Act with respect to the loans and investments made.

• (v) The Company has not accepted any deposits within the meaning from section 73 to 76 of the Act and the companies (Acceptance of Deposit) Rules 2014 (as amended) during the year. Hence, paragraph 3(v) of the Order is not applicable.

• (vi) The Central Government has not prescribed the maintenance of cost records under section 148(1) of the Act, for any of the services rendered by the Company. Hence, paragraph 3(vi) of the Order is not applicable.

• (vii) (a) According to the information and explanations given to us and the records of the Company examined by us, the Company has generally been regular in depositing with the appropriate authorities undisputed dues, including provident fund, employees’ state insurance, income-tax, sales tax, service tax, customs duty, excise duty, goods and service tax, value added tax, cess & other material statutory dues as applicable to it and there were no such dues outstanding as at 31st March, 2021 for a period of more than six months from the date they became payable.

• (b) According to the information and explanations given to us, there are no material dues of income tax. sales tax, service tax, custom duty, excise duty, goods and service tax and value added tax which have not been deposited with the appropriate authorities on account of any dispute.

• (viii) The Company does not have any loans or borrowings from any financial institution, banks, government or debenture holders during the year. Hence, paragraph 3(viii) of the Order is not applicable.

• (ix) The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Hence, paragraph 3 (ix) of the Order is not applicable.

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V. B. Desai Financial Services Limited

• (x) According to the information and explanations given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.

• (xi) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the provisions of section 197 read with Schedule V to the Act.

• (xii) In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Hence, paragraph 3(xii) of the Order is not applicable.

• (xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act, where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable Ind AS.

• (xiv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

• (xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non- cash transactions with directors or persons connected with him. Hence, paragraph 3(xv) of the Order is not applicable.

• (xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.

For N S Shetty & Co. Chartered Accountants FR No. : 0110101W N. S. Shetty Place : Mumbai Partner Date : June 09, 2021 M. No. 035083

Annexure - B TO THE INDEPENDENT AUDITOR’S REPORT

(Referred in Para 2(f) under “Report on Other Legal and Regulatory Requirements’ section of our report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)

We have audited the internal financial controls over financial reporting of V. B. Desai Financial Services Limited (“the Company”) as of March 31, 2021 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Board of Directors of the Company is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to respective company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditor’s Responsibility

Our responsibility is to express an opinion on the internal ~~financial controls over financial reporting of the Company,~~

based on our audit, we conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the internal financial controls system over financial reporting of the Company.

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V. B. Desai Financial Services Limited

Meaning of Internal Financial Controls Over Financial Reporting

A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls,

material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2021, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

	For N S Shetty & Co.
	Chartered Accountants
	FR No. : 0110101W
	N. S. Shetty
Place : Mumbai	Partner
Date : June 09, 2021	M. No. 035083

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V. B. Desai Financial Services Limited

Balance Sheet As At 31st March, 2021

Particulars Note No.	As at 31st March, 2021 Rs. Rs.	As at 31st March, 2021 Rs. Rs.		As at 31st March, 2020 Rs. Rs.
ASSETS Non-Current Assets (a) Property, Plant & Equipment (b) Financial Assets (i) Investments 1 2 (ii) Loans 3 (iii) Other Financial Assets 4 (c) Deferred Tax Assets (Net) 5 (d) Other Non-Current Assets 6 Total Non-Current Assets Current Assets (a) Inventories 7 (b) Financial Assets (i) Trade Receivables 8 (ii) Cash and Cash Equivalents 9 (iii) Bank Balances other than (ii) above (iv) Loans 10 3 (v) Other Financial Assets 4 (c) Other Current Assets 6 Total Current Assets Total Assets EQUITY AND LIABILITIES Equity (a) Equity Share Capital 11 (b) Other Equity 12 Total Equity LIABILITIES Non-Current Liabilities (a) Provisions 13 Total Non-Current Liabilities Current Liabilities (a) Financial Liabilities - Outstanding dues of MESE - Outstanding dues other than MESE 14 14 (b) Other Current Liabilities 15 (c) Provisions 13 Total Current Liabilities Total Equity and Liabilities	1,46,355 8,20,93,191 1,52,66,856 5,00,000 10,54,955 17,23,464 10,07,84,821 64,595 18,25,513 10,75,195 76,544 - 48,75,928 4,68,291 78,42,609 10,86,27,431 4,53,81,316 5,81,45,505 27,91,654 10,35,26,821 27,91,654 - 12,75,404 2,38,146 7,95,407 23,08,957 10,86,27,431			2,10,891 8,21,75,681 1,30,01,042 5,00,000 10,65,989 16,52,549 9,86,06,152 64,595 18,25,513 10,75,195 76,544 36,824 45,49,367 6,44,435 82,72,474 10,68,78,626 4,53,81,316 5,62,04,476 27,91,654 10,15,85,792 27,91,654 - 10,03,984 7,01,790 7,95,407 25,01,181 10,68,78,626
		10,86,27,431
				- 10,03,984 7,01,790 7,95,407

See accompanying notes forming part of the 23 to 29 financial statements For and on behalf of the Board of Director As per our attached Report of even date Samir R. Dedhia Pradip R Shroff Chairman 06864567 Managing Director For N. S. Shetty & Co. 00286291 Chartered Accountants Hemendra Shroff Firm Reg. No. 110101W Director Shashank S. Vijayakar 00286509 Chief Financial Officer N. S. Shetty Kamlesh M Gagavani Partner Company Secretary Membership No. 035083 Place : Mumbai Place : Mumbai Date :June 09, 2021 Date :June 09, 2021

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V. B. Desai Financial Services Limited

Statement of Profit and Loss for the period ended 31st March, 2021

Particulars Note No.	For the year ended For the year ended 31st March, 2021 31st March, 2020 Rs. Rs.
Revenue From Operations 16 Other Income 17 Total Income EXPENSES Employee Benefits Expense 18 Finance Costs 19 Depreciation 20 Other Expenses 21 Total Expenses Profit/(Loss) before exceptional items and tax Exceptional Items Profit before tax Tax Expenses (i) Current Tax 22 (ii) Deferred Tax (iii) Prior period Tax Profit/(Loss) for the year after Tax Other comprehensive income Items that may not be reclassified to the statement Profit or Loss Remeasurement of defined benefit plan Income Tax relating to items that may not be reclassified to the statement of Profit & Loss Total other Comprehensive Income, net of Tax Total comprehensive income for the year (XVI) Earnings per equity share (for continuing operation) (i) Basic (ii) Diluted	2,01,42,668 2,48,81,142 14,30,992 10,83,270
	2,15,73,660 2,59,64,412
	35,22,602 36,72,522 - - 64,536 2,46,139 1,48,10,805 1,49,28,074
	1,83,97,943 1,88,46,735
	31,75,717 71,17,677 - -
	31,75,717 71,17,677 6,69,000 11,83,850 11,034 5,54,654 21,370 -
	19,41,029 59,12,457 - - - -
	- -
	19,41,029 59,12,457
	0.43 0.43 1.31 1.31

See accompanying notes forming part of the financial statements 23 to 29

As per our attached Report of even date

For N. S. Shetty & Co. Chartered Accountants

For and on behalf of the Board of Directors

Firm Reg. No. 110101W N. S. Shetty Partner Membership No. 035083

Place : Mumbai Date :June 09, 2021

Samir R. Dedhia Pradip R Shroff Chairman Managing Director 06864567 00286291 Hemendra Shroff Shashank S. Vijayakar Director Chief Financial Officer 00286509 Kamlesh M Gagavani Company Secretary Place : Mumbai Date :June 09, 2021

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V. B. Desai Financial Services Limited

Cash Flow Statement for the year ended 31st March, 2021

	For the year ended 31st March, 2021 Rs. Rs.	For the year ended 31st March, 2021 Rs. Rs.	For the year ended 31st March, 2020 Rs. Rs.	For the year ended 31st March, 2020 Rs. Rs.	For the year ended 31st March, 2020 Rs. Rs.
A Cash Flow from Operating Activities Net Profit before Tax Adjustments for : Depreciation Provision/(Reversal) for Gratuity Interest on Income Tax Refund Dividend Income Interest paid Profit on Sale of Investments Operating Profit before Working Capital Changes Adjustments for : (Increase)/Decrease in Trade Receivables (Increase)/Decrease in Loans and Advances & Other Current and Non-Current Assets Increase/(Decrease) in Liabilities & Provisions Income Tax Refund Interest on Income Tax Refund Income Tax Paid Net Cash flow from Operating Activities (A) B Cash Flow from Investing Activities Purchase of Fixed Assets Purchase of Investments/Stock in trade Dividend Income Sale of Investments Net Cash flow from Investing Activities (B) C Cash Flow from Financing Activities Interest paid Net Cash flow from Financing Activities (C) Net Increase/(Decrease) in Cash & Cash Equivalents (A+B+C) Cash & Cash Equivalents at the beginning of the year Cash & Cash Equivalents at the end of theyear	64,536 - (964) - -	31,75,717 63,572	2,46,139 - - (49,501) - (32,80,287)		71,17,677 (30,83,649)
	3,79,570 (21,35,252) (1,92,224)		(2,34,887) (18,90,845) (5,59,524)
		32,39,289 (19,47,906)			40,34,028 (26,85,256)
		12,91,383 - - (9,12,552)			13,48,772 - - (20,05,485)
		3,78,831			(6,56,713)
		- 964 -			- - 49,501 4,67,156
		964			5,16,657
		-			-
		-			-
		3,79,795 11,51,739 9,76,880			(1,40,056) 12,91,796 11,51,739

As per our attached Report of even date For N. S. Shetty & Co. For and on behalf of the Board of Directors Chartered Accountants

Firm Reg. No. 110101W N. S. Shetty Partner Membership No. 035083 Place : Mumbai Date :June 09, 2021

Samir R. Dedhia Pradip R Shroff Chairman Managing Director 06864567 00286291 Hemendra Shroff Shashank S. Vijayakar Director Chief Financial Officer 00286509 Kamlesh M Gagavani Company Secretary Place : Mumbai Date :June 09, 2021

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V. B. Desai Financial Services Limited

STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED MARCH 31, 2021 (Also refer Note 12)

A Equity Share Capital (also refer note 11)

Amount Rs.

	AmountRs.
Particulars	Total Equity share capital
As at March 31, 2019 Changes in equity share capital As at March 31, 2020 Changes in equity share capital As at March 31, 2021	4,53,81,316 - 4,53,81,316 4,53,81,316

• B Other Equity (also refer note 12)

Other Equity (also refer note 12)
Particulars		Reserves and Surplus
	Securities Premium Account	Surplus/(Deficit) in Statement of Profit and Loss	Total 5,02,92,019 - - 59,12,457 -
Balance as at March 31, 2019	2,12,90,975	2,90,01,044
Changes during the year Premium on shares issued during the year Profit for the year Other Comprehensive income/(loss) for the year, net of tax	- - -	- - 59,12,457 -
Balance as at March 31, 2020 Changes during the year Premium on shares issued during the year Profit for the year Other Comprehensive income/(loss) for the year, net of tax Balance as at March 31, 2021	2,12,90,975 - - 2,12,90,975	3,49,13,501 - 19,41,029 - 3,68,54,530	5,62,04,476 - 19,41,029 - 5,81,45,505

As per our attached report of even date

For and on behalf of the Board of Directors

For N. S. Shetty & Co. Chartered Accountants Firm Reg. No. 110101W

Samir R. Dedhia Pradip R Shroff Chairman Managing Director 06864567 00286291

N. S. Shetty Partner Membership No. 035083

Hemendra Shroff Director 00286509

Shashank S. Vijayakar Chief Financial Officer

Kamlesh M Gagavani Company Secretary

Place : Mumbai Date : June 9, 2021

Place : Mumbai Date : June 9, 2021

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V. B. Desai Financial Services Limited

CORPORATE INFORMATION

The Company was incorporated in the year 1985 and came out with Maiden Public Issue of Equity Shares at par in the year 1986. The Company had managed number of Public / Rights Issue of Equity / Debt of Corporates even during the period when Controller of Capital Issue (CCI) was in existence. The Company is Registered Category - I Merchant Banker with Securities and Exchange Board of India (SEBI). The Shares of the Company are Listed on Bombay Stock Exchange (BSE) since 1986. The Company is actively engaged in the Management of IPOs of SME as well as on the Main Stock Exchange (BSE). The main focus of activities of the company includes Consultancy and Valuation.

SIGNIFICANT ACCOUNTING POLICIES FOR THE YEAR ENDED 31ST MARCH, 2021

A. Basis of Preparation of Financial Statements

The financial statements have been prepared on the historical cost basis except for following assets and liabilities which have been measured at fair value amount: i) Certain Financial Assets and Liabilities ii) Defined benefit plans.

B. Property, Plant & Equipment and Depreciation

Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses if any. Depreciation on property, plant and equipment is provided on straight line method based on useful life of assets as prescribed in Schedule II to the Companies Act, 2013.

C. Leases

Leases are classified as finance leases whenever the terms of the lease, transfers substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases. Assets held under finance leases are initially recognised as assets of the Company at their fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the balance sheet as a finance lease obligation. Operating lease payments are recognised as an expense in the Statement of Profit and Loss on a straight-line basis over the lease term except where another systematic basis is more representative of time pattern in which economic benefits from the leased assets are consumed.

D. Inventories (Securities)

Items of inventories (securities) are measured at lower of cost and net realisable value.

E. Impairment of Non-Financial Assets - Property, Plant and Equipment

Property, plant and equipment with finite life are evaluated for recoverability whenever there is any indication that their carrying amounts may not be recoverable. If any such indication exists, the recoverable amount (i.e. higher of the fair value less cost to sell and the value-in- use) is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the cash generating unit (CGU) to which the asset belongs. If the recoverable amount of an asset (or CGU) is estimated to be less than its carrying amount, the carrying amount of the asset (or CGU) is reduced to its recoverable amount. An impairment loss is recognised in the Statement of Profit and Loss. The impairment loss recognised in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

F. Foreign Currency Transactions

The functional currency is Indian rupee (Rs.)Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction or that approximates the actual rate at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency closing rates of exchange at the reporting date. Any income or expense on account of exchange difference either on settlement or on translation is recognised in the Statement of Profit and Loss except in case of long term liabilities, where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets.

G. Investments

The Company has accounted its investments in unquoted equities at cost or at fair market value.

H. Revenue Recognition

Revenue from rendering of services is recognised when the performance of agreed contractual task has been completed.

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V. B. Desai Financial Services Limited

Interest income from a financial asset is recognised using effective interest rate method. Dividend income is accounted for when the right to receive it is established.

I. Employee Benefits

The Company’s contribution to Provident fund is charged to the Statement of Profit and Loss. The Gratuity liability, which is a defined benefit plan, is provided on the basis of actuarial valuation as on balance sheet date and same is unfunded. Remeasurement of defined benefit plans in respect of post-employment are charged to the Other Comprehensive Income. Employees are entitled to avail leave instead of leave encashment.

J. Earnings per share

Basic earnings per share is computed by dividing the profit / (loss) after tax (including the post tax effect of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year.

K. Accounting for Taxes on Income

Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities, based on tax rates and laws that are enacted or substantively enacted at the Balance sheet date. Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The carrying amount of Deferred tax liabilities and assets are reviewed at the end of each reporting period.

L. Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognized, when there is a present legal or constructive obligation as a result of past events, where it is probable that there will be outflow of resources to settle the obligation and when a reliable estimate of the amount of the obligation can be made. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows. Where the effect is material, the provision is discounted to net present value using an appropriate current market-based pre- tax discount rate and the unwinding of the discount is included in finance costs. Contingent liabilities are recognised only when there is a possible obligation arising from past events, due to occurrence or non-occurrence of one or more uncertain future events, not wholly within the control of the Company, or where any present obligation cannot be measured in terms of future outflow of resources, or where a reliable estimate of the obligation cannot be made. Obligations are assessed on an ongoing basis and only those having a largely probable outflow of resources are provided for. Contingent assets are not disclosed in the financial statements unless an inflow of economic benefits is probable.

M. Significant accounting judgements, estimates and assumptions

The preparation of the Company’s financial statements requires management to make judgements, estimates and assumptions as described below that affect the reported amounts and the accompanying disclosures. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

Assumptions

The cost of the defined benefit plans and the present value of the defined benefit obligations are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future.

Estimates

The estimates used by the company to present the amount in accordance with Ind AS reflect conditions as at the March 31, 2021.

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40

V. B. Desai Financial Services Limited

Notes forming part of the financial statements for the year ended 31[st ] March, 2021

1. Property, Plant & Equipments

Following are the changes in the carrying value of property, plant and equipment for the year ended March 31, 2021:

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Plant & Office Furniture &
Particulars Machinery Equipment Vehicle Fixture Computer Total
GROSS BLOCK
-
As at March 31, 2019 1,94,126 24,606 10,32,294 2,05,371 14,56,400
Additions
Deletions
-
As at March 31, 2020 1,94,126 24,606 10,32,294 2,05,371 14,56,400
Additions
Deletions
-
As at March 31, 2021 1,94,126 24,606 10,32,294 2,05,371 14,56,400
ACCUMULATED DEPRECIATION
-
As at March 31, 2019 54,105 10,941 8,50,689 83,635 9,99,370
-
Charge for the year 18,035 2,323 1,81,605 44,176 2,46,139
Deductions - - - - - -
-
As at March 31, 2020 72,140 13,264 10,32,294 1,27,811 12,45,509
- -
Charge for the year 18,035 11,342 35,159 64,536
Deductions - - - - - -
-
As at March 31, 2021 90,175 24,606 10,32,294 1,62,970 13,10,045
NET BLOCK
As at March 31, 2019 1,40,021 13,665 - 1,81,605 1,21,736 4,57,028
- -
As at March 31, 2020 1,21,986 11,342 77,560 2,10,891
- - -
As at March 31, 2021 1,03,951 42,401 1,46,355
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V. B. Desai Financial Services Limited

Notes forming part of the financial statements for the year ended 31st March, 2021

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2. Investments As at 31st March 2021 As at 31st March 2020
No. of
Face No. of Value of Value of
Name of the Scrip Value Shares shares Shares shares
Rs. Rs
Quoted
Equity Shares of Other Companies
Measured at FVTPL
TechNvision Ventures Ltd. (Solix 10 9,080 1,739,724 9,080 1,897,720
Technologies Ltd. )
Total of Quoted Equity Shares 1,739,724 1,897,720
Unquoted
Equity Shares of Other Companies
Measured at FVTPL
Bluechip Leasing & Finance Ltd 10 50,000 410,000 50,000 411,000
Citi Securities & Financial Services Pvt. Ltd. 10 20,200 117,160 20,200 127,866
Desai Investments Pvt.Ltd. 10 50,000 1,850,000 50,000 2,520,000
Essar Steel Ltd. 10 172 - 172 -
Imperial Spirits Ltd. 10 24,900 - 24,900 -
Merican Funds Ltd 10 6,535 60,253 6,535 60,383
Neptune Steel Strips Ltd. 10 256,000 7,091,000 256,000 6,668,800
Traitrya Construction Finance Ltd. 10 721,700 1,75,37,310 721,700 17,235,096
Valuecorp Securities & Fin. Ltd. 10 351,658 82,63,963 351,658 8,327,980
Vishvakarma Equipment Fin. (I) Ltd. 10 500,000 1,25,00,000 500,000 12,403,429
Total of Unquoted Equity Shares 4,78,29,886 47,754,554
Mutual Funds No.of Units No.of Units
UTI Master Share (Measured at Cost) 566 14,133 566 14,133
HDFC Cash Management (FVTPL) 220.397 9,898 220.397 9,274
Total of Unquoted Mutual Funds 24,031 23,407
Un-Quoted
Preference Shares of Other Companies
Measured at Cost
Deep Industrial Finance Ltd. 1,000 12,500 12,500,000 12,500 12,500,000
Traitrya Construction Finance Ltd. 1,000 5,700 5,700,000 5,700 5,700,000
Valuecorp Securities & Fin. Ltd. 1,000 5,700 5,700,000 5,700 5,700,000
Vishvakarma Equipment Fin. (I) Ltd. 1,000 1,700 1,700,000 1,700 1,700,000
Pearl Housing Finance Ltd. 1,000 1,200 1,200,000 1,200 1,200,000
Shriyam Auto-Fin Ltd. 1,000 5,700 5,700,000 5,700 5,700,000
Total of Unquoted Preference Shares 32,500,000 32,500,000
Total of Unquoted Securities 8,20,93,191 8,21,75,681
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V. B. Desai Financial Services Limited

Notes forming part of the financial statements for the year ended 31st March, 2021

Particulars		As at 31st March, 2021 Rs.	As at 31st March, 2021 Rs.	As at 31st March, 2020 Rs.
3. Loans (Unsecured, Considered Good) (i) Non-current Security Deposits Other Loans Loans to Employees Inter Corporate Deposit To Others (ii) Current (Unsecured, Considered Good) Loans and Advances to Employees To Others 4. Other Financial Assets (i) Non-current (Unsecured, Considered Good) Interest Accrued on Deposits In Deposit Account with maturity of more than 12 months Receivable on Sale of Non-Current Investments - (ii) Current (Unsecured, Considered Good) Interest Accrued on Deposits Contractually Reimbursable Expenses In Deposit Account with maturity of more than 12 months Receivable on Sale of Non-Current Investments 5. Deferred Tax Assets Provision for Gratuity Related to Fixed Assets Deferred Tax Liability		95,000 - 1,51,71,856 36,200 Total 1,52,66,856 - - Total - - 500,000 - Total 500,000 12,76,928 - - 3,600,000		95,000 - 12,869,842 36,200
				13,001,042
				36,824 -
		Total		36,824 - 500,000 -
		Total		500,000
				605,087 344,280 - 3,600,000
			Total 48,75,938 902,791 1,52,164 - Total 10,54,955	4,549,367 948,710 1,63,198 - 1,065,989

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43

V. B. Desai Financial Services Limited

Notes forming part of the financial statements for the year ended 31st March, 2021

Particulars			As at 31st March, 2021 Rs.	As at 31st March, 2021 Rs.	As at 31st March, 2021 Rs.	As at 31st March, 2020 Rs.
6. Other Assets (i) Non-current (Unsecured, Considered Good) Advance Income Tax (Net of Provisions) Other Advances Prepaid Expenses (ii) Current (Unsecured, Considered Good) Other Advances Prepaid Expenses Balances with Govt. Authorities (GST) 7.Securities for Trade			17,23,464 - Total 17,23,464 4,65,421 2,870 Total 4,68,291			1,479,912 172,637 1,652,549
Particulars	Fac e Valu	As	at 31st March 2021 As at 31st March 2020
		No. of Shares		Value of shares No. of Shares	Value of shares
At Fair Value through Profit and Loss Quoted 1.Equity Shares Ugro Capital Ltd. (Chokani Securities Ltd) Mafatlal Spg. & Wvg. Co.Ltd. Reliance Indus. Infrastructure Ltd. Reliance Power Ltd Sika Interplant System Ltd. Sunraj Diamond Exports Ltd. 2.Mutual Funds Nippon India Mutual Fund Total of Quoted Securities	10 10 10 10 10 10 100	248 1 20 125 3 500 10		29,946 63 7,298 631 868 1,385 248 1 20 125 3 500 10 40,191 35,376 35,376 75,567	24,527 63 4,169 239 401 3,610
					33,009
					31,586
					31,586
					64,595

7. Securities for Trade

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V. B. Desai Financial Services Limited

Notes forming part of the financial statements for the year ended 31st March, 2021

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Particulars As at As at
31st March, 2021 31st March, 2020
Rs. Rs.
8. Trade Receivables
Current - Unsecured
Trade receivables considered Good 14,45,944 1,825,514
Trade receivables which have significant increase in Credit Risk - -
Trade receivables - credit impaired 1,750,592 1,750,592
Less: Provision for Doubtful Trade Receivables (1,750,593) (1,750,593)
Total 14,45,944 1,825,513
The credit period ranges from 15 days to 180 days.
No trade or other receivable are due from directors or other officers of the Company either severally or jointly with any other person. Nor any trade
or other receivables are due from firms or private companies respectively in which any director is a partner, a director or a member.
9. Cash and Cash Equivalents
Cash on Hand 420,872 364,450
Balances with Banks in Current Accounts 474,267 714,450
Total 895,139 1,075,195
10. Other Bank Balances
in Margin Accounts against Bank Guarantee 81,741 76,544
Total 81,741 76,544
11. Equity Share Capital
Authorised
50,00,000 (50,00,000) Equity Shares of Rs.10/- each with voting rights 50,000,000 50,000,000
Total 50,000,000 50,000,000
Issued
45,46,200 (45,46,200) Equity Shares of 10/- each fully paid up with voting rights 45,462,000 45,462,000<br>Total 45,462,000 45,462,000<br>Subscribed & Paid up<br>45,27,890 (45,27,890) Equity Shares of10/- each fully paid up with voting rights 45,278,900 45,278,900
Add: 18,310 (18,310) Forfeited Equity Shares 102,416 102,416
Total 45,381,316 45,381,316
Details of Forfeited Shares :
Amount originally paid up – Class of Shares
18,310 (18,310) Equity Shares 102,416 102,416
The reconciliation of the no. of shares outstanding with voting rights is set out below
Particulars No. of Shares No. of Shares
Equity Shares at the beginning of the year 4,527,890 4,527,890
Add : Shares issued - -
Less : Shares Bought Back - -
Equity Shares at the end of the year 4,527,890 4,527,890
The details of Shareholders holding more than 5% shares with voting rights:
Name of the Shareholder As at 31st March, 2021 As at 31st March, 2020
No. of Shares % held No. of Shares % held
Desai Investments Pvt. Ltd. 771,607 17.04 771,607 17.04
Mrs. Dharati J. Shroff 261,041 5.77 261,041 5.77
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Terms/rights attached to equity shares

The company has only one class of equity shares having par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Annual Report 2020-21

45

V. B. Desai Financial Services Limited

Notes forming part of the financial statements for the year ended 31st March, 2021

	Particulars	Particulars	As at 31st March, 2021 Rs.	As at 31st March, 2020 Rs.
	12. Other Equity Securities Premium Premium received on equity shares issued are recognised in the Securities account. premium Balance as per last Balance Sheet 21,290,975 21,290,975 Retained Earnings Opening Balance 3,49,13,501 Add: Profit for the year including Other Comprehensive Income 19,41,029 3,68,54,530 Total 5,81,45,505 13. Provisions Non-Current Provision for employee benefits Provision for Gratuity 2,791,654 Total 2,791,654 Current Provision for employee benefits Provision for Gratuity 795,407 Total 795,407 14. Trade Payable Outstanding dues of MESE Others - (Refer Note below) 12,75,404 Total 12,75,404 The company does not possess information about the micro, small and medium enterprises, as defined in the Micro, Small and Medium Enterprises Act, 2006 to whom the company owes and accordingly no additional disclosures have been made. 15. Other Current Liabilities Others Statutory Dues 2,38,146 Advance from Customer - Total 2,38,146		21,290,975 21,290,975 3,49,13,501 19,41,029 3,68,54,530 5,81,45,505 2,791,654 2,791,654	21,290,975
				21,290,975
				29,001,044 5,912,457
				34,913,501
		Total		56,204,476
				2,791,654
		Total		2,791,654
				795,407
		Total		795,407
				- 1,003,984 1,003,984 701,790 -
				701,790

.

``

Annual Report 2020-21

46

V. B. Desai Financial Services Limited

Notes forming part of the financial statements for the year ended 31st March, 2021

Particulars	For the Year Ended 31st March, 2021 Rs.	For the Year Ended 31st March, 2020 Rs.
16. Revenue from Operations (a) Sale of Services 2,01,34,818 (b) Other Operating Revenues Change in fair value of Investments - Exchange Fluctuation 7,850 Net Gain on Sale of Shares - Total 2,01,42,668 17. Other Income (a) Interest on Income Tax Refund - (b) Interest 12,23,023 (c) Dividend 964 (d) Miscellaneous Income - (e) Change in Fair value of Deposit through Amortised Cost 2,07,006 Total 14,30,992 18. Employee Benefits Expense Salaries 31,53,000 Contribution to Provident & Other Funds 3,42,720 Gratuity - Staff Welfare Expenses 26,882 Total 35,22,602 18.1.Employee Benefit As per Indian Accounting Standard 19 "Employee Benefits", the disclosures as defined are given below. Defined contribution plans: The company has recognised the following amounts in the Statement of Profit and Loss for the period	2,01,34,818 - 7,850 - Total 2,01,42,668	21,600,856 2,989,437 - 290,850 24,881,142
		- 997,769 49,501 36,000 -
	Total	10,83,270
		3,104,000 323,280 - 245,242 3,672,522

Particulars	As at 31st March, 2021 Rs.	As at 31st March, 2020 Rs.
Contribution to Employees' Provident and other Funds Total Defined benefits plans: Gratuity Non-Funded status of the plan Present value of unfunded obligations Present value of funded obligations Fair value of plan assets Net Liability (Asset) Profit and loss account for current period Service cost: Current service cost Past service cost and loss/ (gain) on curtailments and settlement Net Interest cost Total included in ‘Employee Benefit Expenses’	2,97,720 2,97,720 3,587,060 - - 3,587,060 3,42,720 - - 3,42,720	278,280
		278,280
		3,587,060 - - 3,587,060 3,23,280 - - 3,23,280

Annual Report 2020-21

47

V. B. Desai Financial Services Limited

Notes forming part of the financial statements for the year ended 31st March, 2021

Particulars	As at	As at	As at
	31st March, 2021	31st March, 20
	Rs.	Rs.
Other Comprehensive Income for the current period
Components of actuarial gains/losses on obligations	-
Due to Change in financial assumptions			-
to change in demographic assumption	-		-
Due to experience adjustments	-		-
Return on plan assets excluding amounts included in interest income	-		-
Amounts recognized in Other Comprehensive Income	-		-
Reconciliation of defined benefit obligation
Particulars
Opening Defined Benefit Obligation	-
Transfer in/(out) obligation	-		-
Current service cost	3,42,720	3,23,280
Interest cost	-		-
Actuarial loss/(gain) due to change in financial assumptions	-		-
Actuarial loss/(gain) due to change in demographic assumption	-		-
Actuarial loss/ (gain) due to experience	-		-
Past service cost	-		-
Loss (gain) on curtailments	-		-
Liabilities extinguished on settlements	-		-
Liabilities assumed in an amalgamation in the nature of purchase	-		-
Exchange differences on foreign plans	-		-
Benefits paid	-		-
Closing Defined Benefit Obligation	342,720		323,280
Reconciliation of net defined benefit liability
Particulars
Net opening provision in books of accounts	35,87,060	3,648,886
Transfer in/(out) obligation	-	(3,85,106)
Transfer (in)/out plan assets	-		-
Employee Benefit Expense	-		323,280
Amounts recognized in Other Comprehensive Income	--		-
	-		-
Benefits paid by the Company			-
Contributions to plan assets	-		-
Closing provision in books of accounts	35,87,060	35,87,060
Bifurcation of liability as per schedule III
Particulars
Current Liability*	876,990		876,990
Non-Current Liability	2,710,070	2,710,070
Net Liability	3,587,060	3,587,060

• The current liability is calculated as expected contributions for the next 12 months or the net liability whichever is lower.

Employee Benefits: The Company’s contribution to Provident fund is charged to the Statement of Profit and Loss. The Gratuity liability, which is a defined benefit plan, there is a adequate provision for the same in the Books of Accounts as per the actuarial valuation as on balance sheet date, hence no provision has been made. Re-measurement of defined benefit plans in respect of post-employment if any are charged to the Other Comprehensive Income. Employees are entitled to avail leave instead of leave encashment.

Annual Report 2020-21

48

V. B. Desai Financial Services Limited

Notes forming part of the financial statements for the year ended 31st March, 2021

Notes forming part of the financial statements for the year ended 31st	March, 2021
Particulars As at 31st March, 2021 Rs.	As at 31st March, 2020 Rs.
Principle actuarial assumptions Particulars Discount Rate 5.45% Salary Growth Rate 10% Expected benefitpayments	6.96% 10%
Particulars Year As at 31st March	Year As at 31st March.
2022 2023 2024 2025 2026 2027 to 2031 The future accrual is not considered in arriving at the above cash-flows. 19. Finance Costs - Interest - Total - 20. Depreciation and Amortisation Expenses Depreciation 64,536 Total 64,536 21. Other Expenses Power & Fuel - Repairs and maintenance - Others 101,439 Rates & Taxes 2,500 Communication 119,982 Travelling and Conveyance - Printing and Stationery 87,141 Advertisement Expenses 18,058 Donations - Business Service Charges 432,988 Office Expenses 13,120 Legal and Professional 1,29,66,346 Profit/loss on Inventories 71,517 Payments to Auditors (Refer Note below) 60,000 Registration Fees 315,800 Listing Fees 300,000 Miscellaneous Expenses 321,804 Total 1,48,10,805 Payments to the auditors comprises (net of service tax input credit, where applicable): As Auditors - Statutory Audit 60,000 Total 60,000	2021 2022 2023 2024 2025 2026 to 2030 -
	-
	246,139
	246,139
	- 1,71,520 2,500 1,89,372 18,479 2,72,404 40,880 2,000 5,37,201 - 1,26,53,547 - 60,000 3,11,095 3,00,000 3,69,076
	1,49,28,074
	60,000
	60,000
22. Income Tax Recognised in Profit or Loss Current Tax 6,69,000 Adjustments in respect of Current Income Tax of Prior Years 5,54,654 Total 12,23,654	10,63,000 1,20,850 11,83,850

Annual Report 2020-21

49

V. B. Desai Financial Services Limited

Notes forming part of the financial statements for the year ended 31st March, 2021

Particulars	For the Year	Ended	For the Year	Ended
	31st March,	2021	31st March,	2020
	Rs.		Rs.
23. Earnings per share
Basic
Net profit for the year (Rs.)	19,41,029		5,912,457
Weighted average number of equity shares (Nos.)	4,527,890		4,527,890
Par value per share (Rs.)		10		10
Earnings per share (Rs.)		0.43		1.31

24. Related Party Disclosures

As per Accounting Standard 18, the disclosures of transactions with the related parties are given below: Details of related parties: Description of relationship Names of related parties Key Management Personnel (KMP) Mr. Pradip R. Shroff Mr. Manoj T. Shroff Mr. Hemendra J. Shroff Mr. Kamlesh M. Gagavani Mr. Shashank Vijayakar Enterprise in which KMP/ Relatives of KMP can exercise significant influence Deep Industrial Finance Ltd. Desai Investments Pvt. Ltd. Traitrya Construction Finance Ltd. Valuecorp Securities and Finance Ltd. Vishvakarma Equipment Finance Ltd. Pearl Housing Finance Ltd. Shriyam Auto-Fin Ltd.

Son of a Director

Raj Pradip Shroff

Note: Related parties have been identified by the Management.

Details of related party transactions during the year ended 31 March, 2021 and balances outstanding as at 31 March, 2021:

	KMP	Enterprise in which	Relatives of		Total
		KMP/ Relatives of KMP	Directors
		can exercise significant
		influence
	Rs.	Rs.	Rs.		Rs
Net Loans and Advances given/(returned)	-	81,71,856			81,71,856
	-	5,869,842		-	5,869,842
Receivable on sale of Non - Current Investments	-	3,600,000		-	3,600,000
	-	3,600,000		-	3,600,000
Remuneration	422,400	-		-	422,400
	422,400	-		-	422,400
Interest received	- -	693105			693105
		409255			409255
Purchase of Investments	-	-		-	-
	-	-		-	-
		-		-	-
Brokerage Paid	-	-		-	-
Balances outstanding at the end of the year
Net Loans and Advances given/(returned)	-	81,71,856		-	81,71,856
	-	-		-	-
Note: Figures in italics relates to the previous year

Annual Report 2020-21

50

V. B. Desai Financial Services Limited

P

Notes forming part of the financial statements for the year ended 31st March, 2021

25. Earnings in Foreign Exchange

Earnings in Foreign Exchange
Particulars	For the year ended For the year ended
	31st March, 2021 (Rs.) 31st March, 2020 (Rs)
Professional fees	21,78,322 1,623,705

26. Segment Reporting

The Company has only one segment i.e. Merchant Banking and financial services, therefore segment wise reporting has not been given as required by Indian Accounting Standard (IND AS 108).

27. Impact of COVID-19

In assessing the impact of COVID-19 on recoverability of trade receivables, contract assets and contract costs, the Company has considered internal & external information up to the date of approval of these financial statements. Based on the current indicators of future economic conditions, the Company expects to recover the carrying amount of the assets & revenue recognised accordingly. The impact of COVID-19 may be different from that estimated at the date of approval of financial statement.

28. Adoption of New Income Tax Provision ie. Section 115BAA of Income Tax Act

The Company has elected an option of reduced income tax rate of 22% plus surcharge and cess available under section 115BAA which is made effective vide Taxation Laws (Amendment) Ordinance 2019 from assessment year beginning on or after the April 1, 2020.

29. Financial Risk Management

Financial risk factors

The Company’s principal financial liabilities, comprises of trade and other payables and other financial liabilities. The main purpose of these financial liabilities is to finance the Company’s operations The Company’s principal financial assets include trade and other receivables, cash and cash equivalent, investments and short-term deposits that derive directly from its operations. The Company’s activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Company’s primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance.

The Company’s senior management overseas the management of these risks. Company’s financial risk activities are governed by appropriate policies and procedures laid out by the senior management and financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Foreign currency risk

Foreign exchange risk arises from future commercial transactions and recognized assets and liabilities denominated in a currency that is not a company’s functional currency. Impact of the rate fluctuation is accounted in profit and loss.

Credit risk analysis

Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk arising from cash and cash equivalent ,deposits with banks, trade receivables, investments and other financial assets. Credit risk has been managed by the company by establishing credit limits and creditworthiness of customers to which the company grants credit terms in the normal course of business. For banks and financial institutions, only high rated banks/ institutions are accepted.

Customer credit risk is managed by each customer group subject to the Company’s established policy, procedures and control relating to customer credit risk management. Trade Receivable has been managed by the Company by establishing credit limits and credit worthiness of customers to which the Company grants credit terms in the normal course of business.

Provision on Trade receivable is calculated as per expected credit loss method (ECL) as per IND AS. ECL is calculated on the basis of average bad debts on turnover of 3 years i.e from 2015-16 to 2017-18. Such average % is moderated to align with current and future business , customers and risk profile. The provision determined as per policy for the year 2016-17 amounts to Rs.17,50,592/-. As there is adequate provision pre-existing in the books, it is not required to make any additional additional provision for the year. Further, it is also proposed to continue the same till the provision under IND AS exceeds the pre-existing provision in the books.

Classes of financial assets – carrying amounts:

Classes of financial assets – carrying amounts:
Particulars	As at As at 31st March, 2021(Rs.) 31st March, 2020(Rs)
Investments - Non Current (Note 2) Loans - Non Current (Note 3) Other financial assets- Non Current (Note 4) Trade Receivable - Current (Note 8) Other financial assets- Current (Note 4) Cash and Cash Equivalents (Note 9) Bank Balances other than above (Note 10) Total	8,20,93,191 82,175,681 1,52,66,856 13,001,042 5,00,000 500,000 14,45,943 1,825,513 48,75,928 4,549,367 8,95,139 1,075,195 81,741 76,544
	10,51,58,799 103,203,342

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V. B. Desai Financial Services Limited

Notes forming part of the financial statements for the year ended 31st March, 2021

Thetrade receivables at reporting date analysed by the length of time past due, a Particulars Upto 6 months (Note 3) Total Liquidity risk analysis	trade receivables at reporting date analysed by the length of time past due, a	re:
	Particulars	As at 31st March, 2021 Rs.	As at 31st March, 2020 Rs.
		14,45,944 14,45,944	1,825,514 1,825,514

Risk assessment

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. The Company has assets which are expected to be realised within 12 months Rs.47,21,345/- as on March 2021 (as on March 2020 is Rs.51,35,649/-). The Company has liabilities which are expected to mature within 12 months Rs.27,91,973/- as on March 2021 (as on March 2020 is Rs.25,01,181/-). Hence Company had a working capital of Rs.19,29,372/- as on March 2021 (as on March 2020 is Rs.26,34,468/-).

Risk Management

Whenever working capital is required Company’s Executive Directors provides funding to the Company.

Fair value hierarchy

Level 1 - Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments, traded bonds and mutual funds that have quoted price. The fair value of all equity instruments (including bonds) which are traded in the stock exchanges is valued using the closing price as at the reporting period.

Level 2 – The fair value of financial instruments that are not traded in active market (for example, counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3 - If one or more of the significant Inputs is not based on observable market data (unobservable inputs), the instrument is included in level 3. This is case of the unlisted equity instruments included in level 3

Financial assets and liabilities measured at fair value-recurring fair value measurements

Particulars	Fair value measurement using
	Quoted prices in active markets Significant observable inputs Significant unobservable inputs
	(Level 1) (Level 2) (Level 3)
Financial assets Financial instrument at FVTPL as at March 31, 2021 Unquoted/Quoted equity investment Financial instrument at FVTPL as at March 31, 2020 Unquoted/Quoted equity investment	- 8,20,93,191 - 8,21,75,681

Financial assets and liabilities measured at amortised cost for which fair values are disclosed

Particulars	Fair value measurement using
	Quoted prices in active markets Significant observable inputs Significant unobservable inputs
	(Level 1) (Level 2) (Level 3)
Financial Assets Deposit- As at March 31, 2021 Financial Assets Deposit- As at March 31, 2020	1,52,66,856 1,29,64,842

There have been no transfers between Level 1 and Level 2 during the period.

Capital management policies

For the purpose of the Company’s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders of the company. The primary objective of the Company’s capital management is to maximise the shareholder value and maintain an optimal capital structure to reduce the cost of capital.

The Company monitors capital on the basis of the gearing ratio; Net debt (total borrowing net of cash and cash equivalents)/Total equity.

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V. B. Desai Financial Services Limited

If undelivered, please return to

V.B.DESAI FINANCIAL SERVICES LIMITED

Cama Building, 1[st ] Floor, 24/26, Dalal Street, Fort, Mumbai – 400 001

Annual Report 2020-21