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Directors Report of Faze Three Ltd.
Mar 31, 2025
The Board of Directors are pleased to present the 40th Annual Report of your Company containing the business
performance and the Audited Financial Statements for the Financial Year ended March 31,2025.
1. FINANCIAL PERFORMANCE (STANDALONE & CONSOLIDATED)
|
Particulars |
For the Year |
For the Year |
For the Year |
For the Year |
|
Revenue from Operations |
658.91 |
535.85 |
689.94 |
564.52 |
|
Other Income |
14.02 |
8.70 |
11.80 |
7.80 |
|
Total Income |
672.93 |
544.55 |
701.74 |
572.32 |
|
Less- Total expenses |
621.51 |
487.31 |
649.09 |
509.87 |
|
Profit before tax |
51.42 |
57.24 |
52.65 |
62.45 |
|
Less - Tax expense |
11.59 |
15.13 |
11.99 |
15.86 |
|
Profit for the year |
39.83 |
42.11 |
40.66 |
46.59 |
|
Other comprehensive income |
(0.28) |
(0.56) |
(0.27) |
(0.56) |
|
Total comprehensive income |
39.55 |
41.55 |
40.39 |
46.03 |
|
Earnings per share (INR) |
||||
|
Basic |
16.38 |
17.31 |
16.72 |
19.16 |
|
Diluted |
16.38 |
17.31 |
16.72 |
19.16 |
The above figures are extracted from the Standalone and Consolidated Financial Statements for the
Financial Year ended March 31, 2025, forming part of this Annual Report, which have been prepared in
accordance with the Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs and
provisions of Section 133 of Companies Act, 2013 (âthe Act'') read with the Companies (Indian Accounting
Standards) Rules, 2015, as amended from time to time and other relevant provisions of the Act.
2. KEY HIGHLIGHTS OF THE FINANCIAL PERFORMANCE/ STATE OF THE COMPANYâS AFFAIRS
Consolidated-
⢠Revenue from operations for year ended March 31, 2025 stood at INR 689.94 Crores as against INR
564.52 Crores for the previous year ended March 31,2024.
⢠Net Profit after Tax (NPAT) for year ended March 31, 2025 stood at INR 40.66 Crores as against INR
46.59 Crores for year ended March 31,2024.
⢠EBIDTA for year ended March 31,2025 stood at INR 92.23 Crores as against INR 94.3 Crores for year
ended March 31, 2024.
Standalone-
⢠Revenue from operations for year ended March 31, 2025 stood at INR 658.91 Crores as against INR
535.85 Crores for the previous year ended March 31,2024.
⢠NPAT for year ended March 31,2025 stood at INR 39.83 Crores versus INR 42.11 Crores for year ended
March 31, 2024
⢠EBIDTA for year ended March 31,2025 stood at INR 89.72 Crores as against INR 88.37 Crores for year
ended March 31,2024
3. DIVIDEND
The Board of Directors have decided to retain the resources to fuel the growth and objectives of the Company
and therefore, have not recommended any dividend for the Financial Year ended March 31, 2025. The
Directors are confident to derive optimum utilization out of the same, which shall be in the best interest of the
stakeholders.
4. SHARE CAPITAL
The Authorised Share Capital of the Company is INR 26,00,00,000/- divided into 2,60,00,000 equity shares of
face value of INR 10/- each. The paid-up share capital of the Company is INR 24,31,90,000/- divided into
2,43,19,000 equity shares of face value of INR 10/- each.
During the F.Y. 2024-25 there was no change in the share capital of the Company.
5. RESERVES
There were no appropriations to reserves/ general reserves during the year under review. The closing balance
of the retained earnings of the Company for the FY 2024-25 is INR. 219.64 Crores on standalone basis and
INR 222.89 Crores on consolidated basis.
6. DEPOSITS/ LOANS FROM DIRECTORS
The Company has not accepted any deposits from the public falling within the ambit of Section 73 and 76 of the
Act read with the Companies (Acceptance of Deposits) Rules, 2014 and Chapter V of the Act. The Company
has not accepted any deposit or any loan from the directors during the year under review.
7. SUBSIDIARY OR ASSOCIATE OR JOINT VENTURE COMPANY
The Company has two wholly owned subsidiaries as on March 31,2025, namely:
i. Faze Three US LLC
The Company has a wholly owned subsidiary (WOS) in USA viz. Faze Three US LLC which is a front
office of the Company in uSa and is actively engaged in sourcing local business within USA for supplying
the Company''s range of products to stores/ retailers.
The Total Income of WOS for FY 2024-25 stood at USD 0.83 MN [INR 6.99 Crores] vs USD 1.17 MN [INR
9.72 Crores] for FY 2023-24. The Profit before Tax for FY 2024-25 stood at USD -0.064 MN [INR 0.5
Crores] as against PAT of USD 0.15 MN [INR 1.32 Crores] during previous year.
ii. Mats and More Private Limited
The Company has a wholly owned subsidiary (WOS) incorporated in India viz. Mats and More Private
Limited. The WOS is engaged in the business of manufacturing, import, export and dealing in patio mats,
floor covering, indoor and outdoor furnishing products including other furnishing products.
The Total Income of WOS for FY 2024-25 stood at INR 26.75 Crores vs INR 21.69 Crores for FY 2023-24.
The PBT for FY 2024-25 stood at INR 2.34 Crores vs INR 3.85 Crores for FY 2023-24.
Pursuant to the provisions of Section 129(3) of the Act, a statement containing salient features of financial
statements of the WOS in Form AOC-1 forms part of this Annual Report as ANNEXURE I. Copies of the
financial statements of the subsidiary companies are available on the Company''s website at
https://www.fazethree.com/investors/financial-results.
During the year under review, no company has become or has ceased to be a Subsidiary, Associate or Joint
Venture of the Company.
8. DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 134(3)(c) of the Act, with respect to the Director''s Responsibility
Statement, the Directors hereby confirm that:
(i) in the preparation of the Annual Financial Statements for the year ended March 31,2025, the applicable
accounting standards have been followed along with proper explanation relating to material departures, if
any;
(ii) such accounting policies as mentioned in Notes to Financial Statements have been selected and applied
consistently and judgements and estimates have been made that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company as at March 31,2025 and of the Profit of the
Company for the year ended on that date;
(iii) proper and sufficient care has been taken for the maintenance of adequate accounting records in
accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company
and for preventing and detecting fraud and other irregularities;
(iv) the Annual Financial Statements for the year ended March 31, 2025 have been prepared on a going
concern basis;
(v) proper internal financial controls were in place to be followed by the Company and that the financial
controls were adequate and were operating effectively;
(vi) proper systems to ensure compliance with the provisions of all applicable laws were in place and that
such systems were adequate and operating effectively.
9. MEETINGS OF THE BOARD
The Board meets at regular intervals to discuss and decide on Company/ Business policy and strategy apart
from other Board businesses. In case of any urgent business need, where the meeting of the Board of
Directors is not envisaged, the Board''s approval is taken by passing resolutions by circulation, as permitted by
law, which are noted and confirmed in the subsequent Board Meeting.
The details of number of Board meetings of the Company are set out in the Corporate Governance Report,
which forms part of this Report. The intervening time gap between two consecutive Meetings was within the
period prescribed under the Act.
10. COMMITTEES OF THE BOARD
The details of all the Committees of the Board along with their terms of reference, composition and meetings
held during the year are provided in the Corporate Governance Report which forms a part of this Report.
11. DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE
RESIGNED DURING THE YEAR
As on March 31,2025, the Board of Directors of the Company comprised of the following:
Mr. Ajay Anand : Chairman and Managing Director
Mr. Sanjay Anand : Whole Time Director
Mrs. Rashmi Anand : Non-Executive Director
Mr. Chuji Kondo : Independent Director
Mr. James Leonard : Independent Director
Mr. Manan Shah : Independent Director
Mr. Vinit Rathod : Independent Director
Mr. Devajyoti Bhattacharya : Independent Director
During the year under review, Mr. Devajyoti Bhattacharya was appointed first as an Additional Director by the
Board on November 13, 2024, whose appointment was later regularized as an Independent Director by the
Shareholders of the Company by passing a Special Resolution on January 16, 2025 via Postal Ballot, thereby
changing the composition of the Board.
Moreover, following Directors were re-appointed by the Shareholders of the Company at the last AGM held in
2024 by way of special resolution:
1. Mr. Ajay Anand (DIN: 00373248) as the Managing Director of the Company for a period of 5 (five) years
with effect from April 1,2025 to March 31,2030.
2. Mr. Sanjay Anand (DIN: 01367853) as the Whole-time Director of the Company for a period of 5 (Five)
years with effect from April 1,2025 to March 31,2030
On the basis of the written representations received from the Directors, none of the above Directors is
disqualified under Section 164 of the Act.
During the year under review, no changes took place in the position of Key Managerial Personnel.
Accordingly, following are the Key Managerial Personnel of the Company as on March 31,2025:
Mr. Ajay Anand : Managing Director
Mr. Sanjay Anand : Whole - time Director
Mr. Ankit Madhwani : Chief Financial Officer
Mr. Akram Sati : Company Secretary & Compliance Officer
The Company has complied with the requirements of having Key Managerial Personnel as per the provisions
of Section 203 of the Act.
12. PERFORMANCE EVALUATION OF BOARD
Pursuant to Section 178 of the Act read with Schedule IV thereto and Regulation 17 of the Securities and
Exchange Board of India (âSEBIâ) (Listing Obligations and Disclosure Requirements), Regulations 2015
(âListing Regulationsâ), a formal evaluation of Board''s performance and that of its Chairperson, its Committees
and individual directors has been carried out by the Board.
The evaluation of all the directors including independent directors was carried out by the entire Board, except
for the director being evaluated. The performance is evaluated after seeking inputs from all the Directors,
through a structured questionnaire, on the basis of the criteria such as the Board composition and structure,
experience and competencies, attendance, effectiveness of board processes, information and functioning,
independent approach, etc. The above criteria are broadly based on the Guidance Note on Board Evaluation
issued by the sEbI on January 05, 2017.
The performance of the Committees was evaluated by the Board after seeking inputs from the committee
members on the basis of the criteria such as the composition of committees, attendance of the members,
recommendations to the Board and their implementation, effectiveness of committee meetings, etc.
The Independent Directors at their separate meeting held on January 27, 2025 evaluated the performance of
the Non-Independent Directors and the Board as a whole, the Chairman of the Board after considering the
views of other Directors and assessed the quality, quantity and timeliness of flow of information between the
Company management and the Board that is necessary for the Board to effectively and reasonably perform
their duties.
The Board of Directors expressed their satisfaction with the outcome of the aforesaid performance
evaluations.
13. DECLARATION BY INDEPENDENT DIRECTORS
All Independent Directors have submitted requisite declarations confirming that they:
i. meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16(1)(b)
of the Listing Regulations and are independent;
ii. have complied with the Code of Conduct laid down under Schedule IV of the Act and
iii. they have valid registration with the Independent Director''s Databank maintained by the Indian Institute
of Corporate Affairs.
In the opinion of the Board, the Independent Directors possess the requisite integrity, experience, expertise
required under all applicable laws and the policies of the Databank.
14. FAMILIARIZATION PROGRAMME FOR THE INDEPENDENT DIRECTORS
The Board members are provided with necessary documents, reports and internal policies to enable them to
familiarize with the Company''s procedures and practices.
Pursuant to the SEBI regulations, the Company organizes Familiarization Programme periodically for the
Independent Directors, with a view to familiarize them with their role, rights and responsibilities in the
Company, nature of industry in which the Company operates, business model of the Company, etc. The Board
familiarization process comprises of the induction programme for new Independent Directors, sessions on
business and functional issues and strategy making. Periodic presentations are made at the Board and
Committee meetings on business and performance updates of the Company including finance, sales, and
overview of business operations, business strategy and risks involved.
During the year under review, the Independent Directors were familiarized on business model, key updates on
business performance, and legal/ regulatory updates at Board Meetings as well as through periodic reports.
The policy for Familiarization Programme for the Independent Directors is available on website of the
Company at https://www.fazethree.com/investors/corporate-governance.
15. POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL
AND EMPLOYEES
In accordance with the provisions of Section 134(3)(e) read with Section 178(2) of the Act and Regulation 19(4)
read with Part D of Schedule II of the Listing Regulations, your Company has adopted a Policy on Nomination &
Remuneration which inter alia, includes the criteria for determining qualifications, positive attributes and
independence of Directors, and remuneration for the directors, key managerial personnel and other
employees. The said policy can be accessed on the website of the Company at
https://www.fazethree.com/investors/policies
16. DISCLOSURE RELATING TO REMUNERATION TO DIRECTORS, KEY MANAGERIAL PERSONNEL AND
PARTICULARS OF EMPLOYEES
Disclosure pertaining to remuneration of employees as required under Section 197(12) of the Act read with
Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is
annexed to the Report as ANnExURE II.
The information pursuant to Section 197 of the Act read with Rule 5(2) and (3) of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is provided
as a separate Annexure forming part of this report which will be provided on request. In terms of Section 136 of
the Act, the reports and accounts are being sent to the shareholders and others entitled thereto, excluding the
said information, however, it is available for inspection by the shareholders in electronic mode, up to the date of
AGM. Members can inspect the same by sending an email to the Company Secretary in advance at
cs@fazethree.com.
Further, as on March 31,2025, the Company has no employee who:
(i) if employed throughout the financial year, was in receipt of remuneration, in aggregate of INR 102.00
Lakhs or more, per annum or
(ii) if employed for part of the financial year, was in receipt of remuneration, in aggregate of INR 8.50 lakhs or
more, per month or
(iii) if employed throughout the financial year or part thereof, was in receipt of remuneration in that year which,
in the aggregate, or as the case may be, at a rate which, in the aggregate, is in excess of that drawn by the
managing director or whole-time director or manager and holds by himself or along with his spouse and
dependent children, not less than two percent of the equity shares of the company.
17. RECEIPT OF ANY COMMISSION FROM COMPANY OR RECEIPT OF COMMISSION/REMUNERATION
FROM ITS HOLDING OR SUBSIDIARY COMPANY BY MD / WTD / ANY DIRECTOR
During the year under review, the Company has not paid any commission to any of its Directors. Further, the
Company does not have a holding company and none of the Directors of the Company have received any
commission/ remuneration from its subsidiary companies.
18. ANNUAL RETURN
Pursuant to the provisions of Sections 134(3)(a) and 92(3) of the Act read with Rule 12(1) of the Companies
(Management and Administration) Rules, 2014, the draft Annual Return for Financial Year ended March 31,
2025, is placed on the website of the Company at https://www.fazethree.com/investors/corporate-
governance.
19. CORPORATE SOCIAL RESPONSIBILITY STATEMENT (CSR)
A business cannot operate in isolation. To be truly profitable and sustainable, it must actively embrace its social
responsibilities. The Company firmly believes that creating a positive synergy between business objectives
and social impact is essential for long-term value creation. Social Responsibility has always been regarded as
a core pillar of the Company''s sustainable growth strategy. Over the years, the Company has contributed
meaningfully to various social causes, reflecting its commitment to inclusive development. The management
remains dedicated to the upliftment of society and the conservation of natural resourcesâboth of which are
vital for holistic and enduring economic progress.
During the FY 2024-25, the Company''s CSR obligation was INR 1,35,25,978/- (Rupees One Crore Thirty-Five
Lakh Twenty-Five Thousand Nine Hundred and Seventy-Eight Only), being 2% of the average net profit during
the preceding 3 year, towards the CSR contribution pursuant to the Rule 7(3) of the Companies (Corporate
Social Responsibility Policy) Rules, 2014. However, post set-off of INR 23,16,233/- (Rupees Twenty-Three
Lakh Sixteen Thousand Two Hundred and Thirty-Three Only), being excess amount spent in previous financial
years, the Company was required to spend INR 1,12,09,745 /- (Rupees One Crore Twelve Lakh Nine
Thousand Seven Hundred and Forty-Five Only) during FY 24-25.
However, on recommendation of the CSR Committee, the Company made a total CSR contribution of INR
1,20,00,000/- (Rupees One Crore and Twenty Lakh Only) during Fy 2024-25 towards CSR activities by way of
donations to Trusts/Societies working for the betterment and holistic upliftment of underprivileged sections of
society. These contributions were aimed at supporting initiatives in areas such as health awareness, quality
education, vocational training, and empowerment of economically weaker communities. The Company
remains committed to making meaningful and focused interventions in line with its CSR policy and continues to
support causes that promote inclusive development and social welfare, particularly in underserved regions.
The brief outline of the Corporate Social Responsibility (CSR) policy of the Company and the annual report on
Corporate Social Responsibility (CSR) activities as per format prescribed in the Companies (Corporate Social
Responsibility Policy) Rules, 2014, is annexed as ANNEXURE III to this report.
The CSR policy has been posted on the website of the Company at https://www.fazethree.com/investors/
policies.
20. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION
The information as required under Section 134(3)(m) of the Act read with Rule 8(3) of the Companies
(Accounts) Rules, 2014 with respect to conservation of energy, technology absorption and foreign exchange
earnings and outgoings is annexed to this report as ANNEXURE IV.
21. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All Related Party Transactions are approved by the Audit Committee. Prior omnibus approval is obtained from
the Audit Committee in respect of the transactions which are repetitive in nature. The transactions entered into
pursuant to omnibus approval so granted are reviewed on a quarterly basis by the Audit Committee.
During the financial year, the Company has entered into transactions with related parties as defined under
Section 2(76) of the Act and Listing Regulations. All related party transactions were carried out at arm''s length
price and in the ordinary course of business.
Further, as per the Listing Regulations, if any related party transaction exceeds Rs 1,000 crore or 10% of the
annual consolidated turnover as per the last audited financial statement, whichever is lower, would be
considered as material and require Members approval. In this regard, the Company had taken necessary
approval of the Members of the Company for Material Related Party Transactions undertaken with Faze Three
Autofab Limited during the year under review. However, there were no material transactions of the Company
with any of its related parties as per the Act. Therefore, the disclosure of Related Party Transactions as
required under Section 134(3)(h) of the Act in Form AOC-2 is not applicable to the Company for FY25 and,
hence, the same is not required to be provided.
However, details of Related Parties and the transactions entered with them have been disclosed as required by
the Indian Accounting Standards in the notes to the Financial Statements.
The Policy on materiality of related party transactions and dealing with related party transactions as approved
by the Board is available at https://www.fazethree.com/investors/policies .
22. MATERIAL CHANGES AND COMMITMENT AFFECTING 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
No material changes or commitments, affecting the financial position of the Company occurred between the
end of the financial year of the Company i.e. March 31,2025 and the date of the Directors'' report.
23. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a Whistle Blower Policy and has established the necessary vigil mechanism for directors
and employees in confirmation with Section 177(9) of the Act and Regulation 22 of the Listing Regulations, to
report concerns about unethical behavior and provide appropriate avenues to the Directors and employees to
bring to the attention of the management any issue which is perceived to be in violation of or in conflict with the
Code of Conduct of the Company and to report concerns about unethical behavior. No person has been denied
access to the Chairman of the Audit Committee. The said policy has been posted on the website of the
Company at https://www.fazethree.com/investors/policies
During the year under review, no complaint or adverse reporting was received by the designated officer of the
Company.
24. DISCLOSURE AS PER SEXUAL HARRASMENT OF WOMEN AT WORKPLACE (PREVENTION
PROHIBITION AND REDRESSAL) ACT, 2013
The Company has zero tolerance towards sexual harassment at the workplace. The Company has adopted
Prevention of Sexual Harassment Policy in line with the provisions of the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder which is
available on the website of the Company at https://www.fazethree.com/investors/policies
The Company has complied with the provisions relating to the constitution of the Internal Committee as per the
Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
No complaints were received during the year under review.
25. RISK MANAGEMENT
The Company has in place a mechanism to inform Board of Directors about the Risk assessment and risk
minimization procedures and periodical reviews to ensure that risk is controlled by the management through
the means of a properly laid-out framework. The Audit Committee has additional oversight in the area of
financial risks and controls. The major risks identified by the businesses and functions are systematically
addressed through mitigating actions on a continuing basis.
26. INTERNAL FINANCIAL CONTROLS
The Company has adequate internal control systems, commensurate with the size, scale and complexity of its
operations, which monitors business processes, financial reporting and compliance with applicable
regulations. The systems are periodically reviewed for identification of control deficiencies and formulation of
time bound action plans to improve efficiency at all the levels.
27. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report as required under Regulation 34 of the Listing Regulations is
enclosed as ANNEXURE V.
28. CORPORATE GOVERNANCE
The Company believes in transparency and adhering to good corporate governance practices in every sphere
of its operations. The Company has taken adequate steps to comply with the applicable provisions of
Corporate Governance as stipulated in the Regulation 15(2) of the Listing Regulations. A report on Corporate
Governance is annexed to this report as ANNEXURE VI.
The Chairman and Managing Director and the Chief Financial Officer of the Company give annual certification
on financial reporting and internal controls to the Board in terms of Regulation 17(8) of the Listing Regulations,
copy of which forms part of the annexed Corporate Governance Report.
29. AUDITORS AND THEIR REPORT
A. STATUTORY AUDITORS AND AUDITORSâ REPORT
M/s. MSKA & Associates Chartered Accountants (Firm Registration No. 105047W), were appointed as
the Statutory Auditor by the Members of the Company at the 37th Annual General Meeting of the
Company, for a period of 5 years and shall hold the office till the conclusion of the 42nd Annual General
Meeting of the Company, to be held in the calendar year 2027.
The Auditor''s Report on IND AS Financial Statements (Standalone and Consolidated) of the Company for
the FY 2024-25, as submitted by M/s. MSKA & Associates, Chartered Accountants, does not contain any
qualifications, reservations or adverse remarks and are self-explanatory.
There have been no instances of fraud reported by the Auditors under Section 143(12) of the Act and
Rules framed thereunder either to the Company or to the Central Government.
B. SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of the and the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, the Secretarial Audit of the Company for the FY 2024-25 was
undertaken by M/s. Sanjay Dholakia & Associates, Practicing Company Secretary, which, inter alia,
included audit of compliance with the Companies Act, 2013, and the Rules made thereunder, the Listing
Regulations and other Regulations and Acts applicable to the Company. The Secretarial Audit Report is
annexed to this report as ANNEXURE VII.
The Secretarial Auditors'' Report for the Financial Year ended March 31, 2025, does not contain any
reservation, qualification or adverse remark.
30. COST AUDIT AND RECORDS
The Company maintains the cost records of its products as per the provisions of sub-section (1) of Section 148
of the Act. Pursuant to the provisions of sub-section (2) of Section 148 of the Act read with Rule 4(3)(i) of the
Companies (Cost Records and Audit) Rules, 2014, the requirement of Cost Audit is not applicable to the
Company.
31. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
Details of loans, guarantees and investments covered under Section 186 of the Act, are provided in the notes to
the Financial Statements forming part of this Annual Report.
32. DISCLOSURE ON ACCOUNTING TREATMENT
The Company has not used any differential treatment which is not in compliance with Accounting Standards
and the financials of the Company depict a true and fair view of the state of affairs of the Company.
33. COMPLIANCE WITH SECRETARIAL STANDARDS BY ICSI
During the year under review, the Company has complied with the applicable Secretarial Standards issued by
the Institute of Company Secretaries of India.
34. BUSINESS RESPONSIBILITY AND SUSTAIN ABILITY REPORT (âBRSR")
Pursuant to Regulation 34(2)(f) of the Listing Regulations, the initiatives taken by the Company from an
environmental, social and governance perspective, are provided in the Business Responsibility and
Sustainability Report (âBRSR") for the Financial Year 2024-25 which is included as a separate section in the
Annual Report. The Company has prepared the BRSR report on a voluntary basis.
35. POLICIES AS REQUIRED UNDER VARIOUS LAWS
The Act and the SEBI Regulations mandate the formulation of certain policies for all listed Companies, the same
are formulated by the Company, approved by the Board and amended from time to time. The said mandated
policies are also available at the website of the Company at https://www.fazethree.com/investors/policies. The
policies are as follows:
a. âDocuments Retention & Archival Policy'' as per Regulation 9 and Regulation 30 of the Listing Regulations
b. âPolicy for determining Materiality of events / information'' as per Regulation 30 of the Listing Regulations
c. âPolicy for determining Material Subsidiary'' as per Regulation 16(1)(c) of the Listing Regulations
d. âCode of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information'' and
âInsider Trading Policy'' as per the SEBI (Prohibition of Insider Trading) Regulation, 2015;
e. âCode of Conduct for Directors and Senior Managerial Personnel'' as per Regulation 17 (5) of the Lising
Regulations.
36. EMPLOYEE STOCK OPTION SCHEME
The Company has adopted and implemented Faze Three Employee Stock Option Scheme 2024 (âthe
Scheme'') which was approved by the Shareholders of the Company at their 39th Annual General Meeting held
in 2024 for granting Stock Options to the eligible employees.
The Scheme is in accordance with SEBI (Share Based Employee Benefits and Sweat Equity) Regulations,
2021 (âSBEB & SE Regulations''). There has been no material variation in the Scheme.
The certificate from the Secretarial Auditor of the Company on the implementation of the Scheme in
accordance with the SBEB & SE Regulations (including any statutory modification(s) and/or re-enactment(s)
thereof for the time being in force), has been uploaded on the website of the Company at
https://www.fazethree.com/investors/esop
Further, the details required to be disclosed as per Rule 12(9) of the Companies (Share Capital and Debenture)
Rules, 2014 and Regulation 14 read with Part F of Schedule I of SBEB & SE Regulations are available on the
website of the Company at https://www.fazethree.com/investors/esop
The disclosure with respect to Section 67(3)(c) of the Act read with Rule 16(4) of the Companies (Share Capital
and Debentures) Rules, 2014 is not applicable to the Company during the year under review.
37. OTHER DISCLOSURES
⢠There was no change in the nature of the business of the Company during the year under review.
⢠The Company has not issued any shares with differential rights as to dividend, voting or otherwise during
the year under review.
⢠The Company has not issued any Sweat Equity or Bonus Shares during the year.
⢠There were no revisions in the financial statements or the Directors'' Report of the Company.
⢠No application has been made under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) ("the IBC,
2016"), hence, the requirement to disclose the details of application made or any proceeding pending
under the IBC, 2016 during the year along with their status as at the end of the financial year is not
applicable.
⢠The requirement to disclose the details of difference between amount of the valuation done at the time of
onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions
along with the reasons thereof, is not applicable during the year under review.
⢠There are no significant material orders passed by the Regulators/ Courts against the Company which
would impact the going concern status of the Company and its future operations.
⢠There are no amounts due and outstanding to be credited to Investor Education and Protection Fund
(IEPF) as on March 31, 2025. However, the unclaimed interim dividend declared for the financial year
2017-18, which had been duly transferred to the Unclaimed Dividend Account in accordance with the
provisions of Section 124 of the Companies Act, 2013, is due for transfer to the IEPF on June 26, 2025. All
the concerned shareholders have been duly notified and reminded to claim their respective claims prior to
the afore-mentioned date.
38. ACKNOWLEDGEMENT
Your Directors wish to place on record their appreciation for the co-operation extended by all the employees,
Bankers, Financial Institutions, various State and Central Government authorities and Stakeholders.
For and on behalf of Board of Directors
Faze Three Limited
Sd/-
Ajay Anand
Date: May 23, 2025 Chairman & Managing Director
Place: Mumbai DIN: 00373248
Mar 31, 2024
The Board of Directors are pleased to present the 39th Annual Report of your Company containing the business performance and the Audited Financial Statements for the year ended on March 31, 2024.
1. FINANCIAL PERFORMANCE (STANDALONE & CONSOLIDATED)
(INR in Crores)
|
Particulars |
For the Year |
For the Year |
For the Year |
For the Year |
|
ended |
ended |
ended |
ended |
|
|
31.03.2024 |
31.03.2023 |
31.03.2024 |
31.03.2023 |
|
|
(Standalone) |
(Standalone) |
(Consolidated) |
(Consolidated) |
|
|
Revenue from Operations |
535.85 |
547.92 |
564.52 |
558.18 |
|
Other Income |
8.70 |
5.57 |
7.80 |
5.58 |
|
Total Income |
544.55 |
553.49 |
572.32 |
563.76 |
|
Profit before tax |
57.24 |
76.71 |
62.45 |
77.62 |
|
Tax expense (incl. deferred tax) |
15.13 |
19.27 |
15.86 |
19.32 |
|
Profit for the year |
42.11 |
57.44 |
46.59 |
58.30 |
|
Other comprehensive income for the year |
(0.56) |
(0.16) |
(0.56) |
(0.63) |
|
Total comprehensive income for the year |
41.55 |
57.28 |
46.03 |
57.67 |
The standalone and consolidated financial statements for the financial year ended March 31, 2024, forming part of this Annual Report, have been prepared in accordance with the Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs.
2. KEY HIGHLIGHTS OF THE FINANCIAL PERFORMANCE/ STATE OF THE COMPANY''S AFFAIRS
During the year under review, the Company achieved consolidated revenue from operations of INR 564.52 Crores as against INR 558.18 Crores in the previous year.
The total Standalone Income for the Quarter ended (QE) March 31, 2024 stood at INR 152.63 Crores versus INR 134.34 Crores for QE March 2023.
The Company''s Standalone Net Profit after Tax (NPAT) for year ended March 31, 2024 stood at 42.11 INR Crores versus INR 57.44 Crores for year ended March 31, 2023 and the Consolidated NPAT for year ended March 31, 2024 stood at INR 46.59 Crores as against NPAT of INR 58.30 Crores for year ended March 31, 2023.
3. DIVIDEND
The Board of Directors have decided to retain the resources to fuel the growth and objectives of the Company and therefore do not recommend dividend for the financial year ended March 31, 2024. The
Directors are confident to derive optimum utilization out of the same, which shall be in the best interest of the stakeholders.
4. SHARE CAPITAL
The Authorised Share Capital of the Company is INR 26,00,00,000/- divided into 2,60,00,000 equity shares of face value of INR 10/- each. The paid-up share capital of the Company is INR 24,31,90,000/- divided into 2,43,19,000 equity shares of face value of INR 10/- each.
During the F.Y. 2023-24 there was no change in the share capital of the Company.
5. RESERVES
There were no appropriations to reserves/ general reserves during the year under review. The closing balance of the retained earnings of the Company for the FY 2023-24 is INR. 175.71 Crores on standalone basis and INR on 178.13 Crores consolidated basis.
6. DEPOSITS/ LOANS FROM DIRECTORS
The Company has not accepted any deposits from the public falling within the ambit of Section 73 and 76 of the Companies Act, 2013 (''the Act'') and the Companies (Acceptance of Deposits) Rules, 2014, or under Chapter V of the Act. The Company has not accepted any deposit or any loan from the directors during the year under review.
7. SUBSIDIARY OR ASSOCIATE OR JOINT VENTURE COMPANY
The Company has two wholly owned subsidiaries as on March 31, 2024, namely:
i. Faze Three US LLC
The Company has a wholly owned subsidiary (WOS) in USA viz. Faze Three US LLC which is a front office of the Company in USA and is actively engaged in sourcing local business within USA for supplying the Company''s range of products to stores/ retailers.
The Total Income of WOS for FY 2023-24 stood at USD 1.17 MN (INR 9.72 Crores) vs USD 1.84 MN (INR 14.92 Crores) for FY 2022-23. The PAT for FY 2023-24 stood at USD 0.15 MN (INR 1.32 Crores) as against PAT USD 0.039 MN (INR 0.79 Crores) during previous year.
ii. Mats and More Private Limited
The Company has a wholly owned subsidiary (WOS) incorporated in India viz. Mats and More Private Limited. The WOS is engaged in the business of manufacturing, import, export and dealing in patio mats, floor covering, indoor and outdoor furnishing products including other furnishing products.
The Total Income of WOS for FY 2023-24 stood at INR 21.69 Crores vs INR 2.61 Crores for FY 2022-23. The PBT for FY 2023-24 stood at INR 3.85 Crores vs INR 0.05 Crores for FY 2023-24.
Pursuant to the provisions of Section 129(3) of the Act, a statement containing salient features of financial statements of the WOS in Form AOC-1 forms part of this Annual Report as ANNEXURE 1. Copies of the financial statements of the subsidiary companies are available on the Company''s website at https://www.fazethree.com/financial-result/.
8. DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 134(3)(c) of the Act, with respect to the Director''s Responsibility Statement, the Directors hereby confirm that:
(i) in the preparation of the Annual Financial Statements for the year ended March 31, 2024, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
(ii) such accounting policies as mentioned in Notes to Financial Statements have been selected and applied consistently and judgements and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2024 and of the Profit of the Company for the year ended on that date;
(iii) proper and sufficient care have been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) the Annual Financial Statements have been prepared on a going concern basis;
(v) proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;
(vi) proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.
9. NUMBER OF MEETINGS OF THE BOARD AND ITS COMMITTEES
The Board and Committees of the Board meet at regular intervals to discuss and decide on Company/ Business policy and strategy apart from other Board business. In case of any urgent business need, where the meeting of the Board of Directors is not envisaged, the Board''s approval is taken by passing resolutions by circulation, as permitted by law, which are noted and confirmed in the subsequent Board Meeting.
The details of number of Board and Committee meetings of the Company are set out in the Corporate Governance Report, which forms part of this Report.
10. DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE RESIGNED DURING THE YEAR
As on March 31, 2024, the Board of Directors of the Company comprised of the following:
Mr. Ajay Anand : Chairman and Managing Director
Mr. Sanjay Anand : Whole Time Director
Mrs. Rashmi Anand : Non-Executive Director
Mr. Chuji Kondo : Independent Director
Mr. James Leonard : Independent Director
Mr. Manan Shah : Independent Director
Mr. Vinit Rathod : Independent Director
On the basis of the written representations received from the Directors, none of the above Directors is disqualified under Section 164 of the Act.
During the year under review, the following changes took place in the position of Key Managerial Personnel:
i. Ms. Samruddhi Varadkar who resigned from the position of Company Secretary & Compliance Officer with effect from the closure of business hours of October 05, 2023.
ii. Mr. Akram Sati was appointed as the Company Secretary & Compliance Officer of the Company with effect from January 05, 2024 in place of Ms. Samruddhi.
Accordingly, following are the Key Managerial Personnel of the Company as on March 31, 2024:
Mr. Ajay Anand : Managing Director
Mr. Sanjay Anand : Whole-time Director
Mr. Ankit Madhwani : Chief Financial Officer
Mr. Akram Sati : Company Secretary & Compliance Officer
The Company has complied with the requirements of having Key Managerial Personnel as per the provisions of Section 203 of the Act.
11. PERFORMANCE EVALUATION OF BOARD
Pursuant to Section 178 of the Act read with Schedule IV thereto and Regulation 17 of the Securities and Exchange Board of India ("SEBI") (Listing Obligations and Disclosure Requirements), Regulations 2015 ("Listing Regulations"), a formal evaluation of Board''s performance and that of its Committees and individual directors has been carried out by the Board.
The evaluation of all the directors including independent directors was carried out by the entire Board, except for the director being evaluated. The performance is evaluated after seeking inputs from all the Directors, through a structured questionnaire, on the basis of the criteria such as the Board composition and structure, experience and competencies, attendance, effectiveness of board processes, information and functioning, independent approach, etc. The above criteria are broadly based on the Guidance Note on Board Evaluation issued by the SEBI on January 05, 2017.
The performance of the Committees was evaluated by the Board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, attendance of the members, recommendations to the Board and their implementation, effectiveness of committee meetings, etc.
The Independent Directors at their separate meeting held on March 26, 2024 evaluated the performance of the Non-Independent Directors and the Board as a whole, the Chairman of the Board after considering the views of other Directors and assessed the quality, quantity and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform their duties.
The Board of Directors expressed their satisfaction to the outcome of the aforesaid evaluations.
12. DECLARATION BY INDEPENDENT DIRECTORS
All Independent Directors have submitted requisite declarations confirming that they (i) meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations and are independent; (ii) have complied with the Code of Conduct laid down under Schedule IV of the Act and (iii) they have registered themselves with the Independent Director''s Database maintained by the Indian Institute of Corporate Affairs.
In the opinion of the Board, the independent directors possess the requisite integrity, experience, expertise required under all applicable laws and the policies of the Bank.
13. FAMILIARIZATION PROGRAMME FOR THE INDEPENDENT DIRECTORS
The Board members are provided with necessary documents, reports and internal policies to enable them to familiarize with the Company''s procedures and practices.
Pursuant to the SEBI regulations, the Company organizes Familiarization Programme periodically for the Independent Directors, with a view to familiarize them with their role, rights and responsibilities in the Company, nature of industry in which the Company operates, business model of the Company, etc. The Board familiarization process comprises of the induction programme for new Independent Directors, sessions on business and functional issues and strategy making. Periodic presentations are made at the Board and Committee meetings on business and performance updates of the Company including finance, sales, and overview of business operations, business strategy and risks involved.
During the year under review, the Independent Directors were familiarized on business model, key updates on business performance, and legal/ regulatory updates at Board Meetings as well as through periodic reports.
The policy for Familiarization Programme for the Independent Directors is available on website of the Company at https://www.fazethree.com/corporate-governance/.
14. POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND EMPLOYEES
In accordance with the provisions of Section 134(3)(e) read with Section 178(2) of the Companies Act, 2013 and Regulation 19(4) read with Part D of Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has adopted a Policy on Nomination & Remuneration which inter alia, includes the criteria for determining qualifications, positive attributes and independence of Directors, and remuneration for the directors, key managerial personnel and other employees. The said policy can be accessed on the website of the Company at https://www.fazethree.com/policies/
15. DISCLOSURE RELATING TO REMUNERATION TO DIRECTORS, KEY MANAGERIAL PERSONNEL AND PARTICULARS OF EMPLOYEES
Disclosure pertaining to remuneration of employees as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to the Report as ANNEXURE II.
The information pursuant to Section 197 of the Act read with Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided on request. In terms of Section 136 of the Act, the reports and accounts are being sent to the shareholders and others entitled thereto, excluding the said information, which will be
made available for inspection by the shareholders in electronic mode, up to the date of AGM. Members can inspect the same by sending an email to the Company Secretary in advance at cs@fazethree.com . Further, as on March 31, 2024, the Company has no employee who:
(i) if employed throughout the financial year, was in receipt of remuneration, in aggregate of INR 102.00 Lakhs or more, per annum or
(ii) if employed for part of the financial year, was in receipt of remuneration, in aggregate of INR 8.50 lakhs or more, per month
(iii) if employed throughout the financial year or part thereof, was in receipt of remuneration in that year which, in the aggregate, or as the case may be, at a rate which, in the aggregate, is in excess of that drawn by the managing director or whole-time director or manager and holds by himself or along with his spouse and dependent children, not less than two percent of the equity shares of the company.
16. RECEIPT OF ANY COMMISSION BY MD / WTD FROM COMPANY OR FOR RECEIPT OF COMMISSION/REMUNERATION FROM ITS HOLDING OR SUBSIDIARY COMPANY
During the year under review, the Company has not paid any commission to any of its Directors. Further, the Company does not have a holding company and none of the Directors of the Company have received any commission/ remuneration from its subsidiary companies.
17. ANNUAL RETURN
Pursuant to the provisions of Sections 134(3)(a) and 92(3) of the Act read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the draft Annual Return as of March 31, 2024, is placed on the website of the Company at https://www.fazethree.com/corporate-governance/
18. AUDIT COMMITTEE
The Audit Committee of the Board of Directors of the Company is duly constituted pursuant to Section 177 of the Act and Regulation 18 of Listing Regulations.
As on March 31, 2024, the Audit Committee comprises of 3 (three) members namely Mr. Vinit Rathod (Chairman), Mr. Ajay Anand (Member) and Mr. Manan Shah (Member). Other details pertaining to the Audit Committee are included in the Corporate Governance Report, which forms part of this report. All the Members of the Committee are adequately literate to understand the financial and other aspects. All the recommendations made by the Committee during the period were accepted by the Board.
19. NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee of the Board of Directors of the Company is duly constituted pursuant to Section 178(1) of the Act and Regulation 19 of Listing Regulations.
The Nomination and Remuneration Committee is responsible for evaluating the balance of skills, experience, independence, diversity and knowledge on the Board and for drawing up selection criteria. The Board of Directors of the Company has defined a policy on Director''s appointment and payment of remuneration including criteria for determining qualifications, positive attributes and independence of Directors and terms of reference of the Committee which is available on the website of the Company at https://www.fazethree.com/policies/.
As on March 31, 2024, the Nomination & Remuneration Committee comprised of 3 (three) members all being Non-Executive Directors namely Mr. Vinit Rathod (Chairman), Mrs. Rashmi Anand (Member) and Mr. Manan Shah (Member). All the recommendations made by the Committee during the period were accepted by the Board.
20. STAKEHOLDERS'' RELATIONSHIP COMMITTEE
The Stakeholders'' Relationship Committee of the Board of Directors of the Company is duly constituted pursuant to Section 178(5) of the Act and Regulation 20 of the Listing Regulations.
As on March 31, 2024, the Stakeholders Relationship Committee comprises of 3 (three) members namely Mr. Vinit Rathod (Chairman), Mr. Ajay Anand (Member) and Mr. Manan Shah (Member). Other details pertaining to the Committee are included in the Corporate Governance Report, which forms part of this report.
21. CORPORATE SOCIAL RESPONSIBILITY STATEMENT (CSR)
The business cannot exist in isolation and for a business to be profitable, it needs to consider the Social Responsibility in order to build a positive synergy between the two. The Company has always considered Social Responsibility as an integral part of sustainable growth and has been over the years contributing towards it in various ways. The management of the Company endeavors for the upliftment of the society and the natural resources which are essential for overall economic growth.
During the FY 2023-24, the Company''s CSR obligation was INR 1,21,69,306/- (One Crore Twenty-One Lakhs and Sixty-Nine Thousand Three Hundred and Six Only), being 2% of the average net profit during the preceding 3 year, towards the CSR contribution pursuant to the Rule 7(3) of the Companies (Corporate Social Responsibility Policy) Rules, 2014. However, post set-off of INR 11,35,539/- (Eleven Lakhs Thirty-Five Thousand and Five Hundred and Thirty-Nine Only), being excess amount spent in previous financial years, the Company was required to spend INR 1,10,33,767/- (One Crore Ten Lakhs and Thirty-Three Thousand Seven Hundred and Sixty-Seven Only) during FY 23-24.
However, on recommendation of CSR Committee, the Company made total CSR contribution of INR 1,33,50,000/- (One Crore Thirty Three Lakhs and Fifty Thousand Only) during FY 2023-24, towards CSR activities by way of donations to Trusts/Society working for the betterment and upliftment of the Blind, Deaf, Widow, Helpless women, mentally challenged, orphans, specially-abled people and Eco-Socio backward part of the Society by providing facilities for their Health, affordable Medical Treatment, Education, affordable Housing and Self-Employment.
The brief outline of the Corporate Social Responsibility (CSR) policy of the Company and the annual report on Corporate Social Responsibility (CSR) activities as per format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014, is annexed as ANNEXURE III to this report.
The CSR policy has been posted on the website of the Company at https://www.fazethree.com/policies/.
22. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION
The information as required under Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption and foreign exchange earnings and outgoings is annexed to this report as ANNEXURE IV.
23. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All Related Party Transactions are approved by the Audit Committee. Prior omnibus approval is obtained from the Audit Committee in respect of the transactions which are repetitive in nature. The transactions entered into pursuant to omnibus approval so granted are reviewed on a quarterly basis by the Audit Committee.
During the financial year, the Company has entered into transactions with related parties as defined under Section 2(76) of the Act and Listing Regulations. All related party transactions were carried out at arm''s length price and in the ordinary course of business.
Further, as per the SEBI Listing Regulations, if any related party transaction exceeds Rs 1,000 crore or 10% of the annual consolidated turnover as per the last audited financial statement whichever is lower, would be considered as material and require Members approval. In this regard, during the year under review, the Company had taken necessary Members approval for Material Related Party Transactions proposed to be undertaken with Faze Three Autofab Limited for FY 2023-24. However, there were no material transactions of the Company with any of its related parties as per the Act. Therefore, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Act in Form AOC-2 is not applicable to the Company for FY24 and, hence, the same is not required to be provided.
Suitable disclosure as required by the Indian Accounting Standards (IND AS 24) has been made in the notes to the Financial Statements.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is available at https://www.fazethree.com/policies/ .
24. MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY
No material changes or commitments, affecting the financial position of the Company occurred between the end of the financial year of the Company i.e. March 31, 2024 and the date of the Directors'' report.
25. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a Whistle Blower Policy and has established the necessary vigil mechanism for directors and employees in confirmation with Section 177(9) of the Act and Regulation 22 of Listing Regulations, to report concerns about unethical behavior and provide appropriate avenues to the Directors and employees to bring to the attention of the management any issue which is perceived to be in violation of or in conflict with the Code of Conduct of the Company and to report concerns about unethical behavior. No person has been denied access to the Chairman of the Audit Committee. The said policy has been posted on the website of the Company at https://www.fazethree.com/policies/.
During the year under review, no complaint or adverse reporting was received by the designated officer of the Company.
26. DISCLOSURE AS PER SEXUAL HARRASMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL) ACT, 2013
The Company has zero tolerance towards sexual harassment at the workplace. The Company has adopted Prevention of Sexual Harassment Policy in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder.
The Company has complied with the provisions relating to the constitution of the Internal Committee as
per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. No complaints were received during the year.
27. RISK MANAGEMENT
The Company has in place a mechanism to inform Board of Directors about the Risk assessment and risk minimization procedures and periodical reviews to ensure that risk is controlled by the management through the means of a properly laid-out framework. The Audit Committee has additional oversight in the area of financial risks and controls. The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis.
28. INTERNAL FINANCIAL CONTROLS
The Company has adequate internal control systems, commensurate with the size, scale and complexity of its operations, which monitors business processes, financial reporting and compliance with applicable regulations. The systems are periodically reviewed for identification of control deficiencies and formulation of time bound action plans to improve efficiency at all the levels.
29. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report as required under Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is enclosed as ANNEXURE V.
30. CORPORATE GOVERNANCE
The Company believes in transparency and adhering to good corporate governance practices in every sphere of its operations. The Company has taken adequate steps to comply with the applicable provisions of Corporate Governance as stipulated in the Regulation 15(2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. A report on Corporate Governance is annexed to this report as ANNEXURE VI.
31. AUDITORS AND THEIR REPORT
A. STATUTORY AUDITORS AND AUDITORS'' REPORT
M/s. MSKA & Associates Chartered Accountants (Firm Registration No. 105047W), were appointed as the Statutory Auditor by the Members of the Company at the 37th Annual General Meeting of the Company, for a period of 5 years and shall hold the office till the conclusion of the 42nd Annual General Meeting of the Company, to be held in the calendar year 2027.
The Auditor''s Report on IND AS financial statements (standalone and consolidated) of the Company for the FY 2023-24, as submitted by M/s. MSKA & Associates, Chartered Accountants, did not contain any qualifications, reservations or adverse remarks and are self-explanatory.
There have been no instances of fraud reported by the Auditors under Section 143(12) of the Act and Rules framed thereunder either to the Company or to the Central Government.
B. SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has undertaken Secretarial Audit for
the FY 2023-24 by appointing M/s. Sanjay Dholakia & Associates, Practicing Company Secretary, which, inter alia, includes audit of compliance with the Companies Act, 2013, and the Rules made thereunder, SEBI Listing Regulations and other Regulations and Acts applicable to the Company. The Secretarial Audit Report is annexed to this report as ANNEXURE VII.
The Secretarial Auditors'' Report for the financial year ended March 31, 2024, does not contain any reservation, qualification or adverse remark.
The Board of Directors at their meeting held on May 23, 2024, has re-appointed M/s. Sanjay Dholakia & Associates, Practicing Company Secretaries (Certificate of Practice No. 1798), as the Secretarial Auditor for FY 2024-25.
32. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
Details of loans, guarantees and investments covered under Section 186 of the Act, are provided at Note No. 6 & 7 in the notes to the financial statements.
33. DISCLOSURE ON ACCOUNTING TREATMENT
The Company has not used any differential treatment which is not in compliance with Accounting Standards and the financials of the Company depict a true and fair view of the state of affairs of the Company.
34. COST AUDIT AND RECORDS
The Company maintains the cost records of its products as per the provisions of sub-section (1) of Section 148 of the Act. Pursuant to the provisions of sub-section (2) of Section 148 of the Act read with Rule 4(3)(i) of the Companies (Cost Records and Audit) Rules, 2014, the requirement of Cost Audit is not applicable to the Company.
35. SECRETARIAL STANDARDS
During the year under review, the Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.
36. SIGNIFICANT MATERIAL ORDERS PASSED BY COURTS, IF ANY
There are no significant material orders passed by the Regulators/ Courts against the Company which would impact the going concern status of the Company and its future operations.
37. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT ("BRSR")
Pursuant to Regulation 34(2)(f) of the Listing Regulations, the initiatives taken by the Company from an environmental, social and governance perspective, are provided in the Business Responsibility and Sustainability Report ("BRSR") for the financial year 2023-24 which is included as a separate section in the Annual Report. The Company has prepared the BRSR report on a voluntary basis.
38. POLICIES UNDER LISTING REGULATIONS
The SEBI Listing Regulations mandated the formulation of certain policies for all listed Companies which are as under.
a. Documents Retention & Archival Policy'' as per Regulation 9 and Regulation 30 which may be viewed at https://www.fazethree.com/policies/
b. Policy for determining Materiality of events / information'' as per Regulation 30 which may be viewed at https://www.fazethree.com/policies/
c. Policy for determining material subsidiary'' as per Regulation 16(1)(c) of the Listing Regulations which may be viewed at https://www.fazethree.com/policies/
39. OTHER DISCLOSURES
⢠There was no change in the nature of the business of the Company during the year under review.
⢠The Company has not issued any shares with differential voting during the year under review.
⢠There were no revisions in the financial statements from the end of the Financial Year to date of the Director Report.
⢠The Company has neither issued any shares nor granted any Stock Options nor any Sweat Equity Shares during the year.
⢠No application has been made under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) ("the IBC, 2016"), hence, the requirement to disclose the details of application made or any proceeding pending under the IBC, 2016 during the year along with their status as at the end of the financial year is not applicable.
⢠The requirement to disclose the details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable during the year under review.
⢠There are no amounts due and outstanding to be credited to Investor Education and Protection Fund as on March 31, 2024.
40. ACKNOWLEDGEMENT
Your Directors wish to place on record their appreciation for the co-operation extended by all the
employees, Bankers, Financial Institutions, various State and Central Government authorities and
Stakeholders.
For and on behalf of Board of Directors Faze Three Limited
Sd/-Ajay Anand
Date: May 23, 2024 Chairman & Managing Director
Place: Mumbai DIN: 00373248
Mar 31, 2023
The Board of Directors are pleased to present the 38th Annual Report of your Company containing the business performance and the Audited Financial Statements for the year ended on March 31, 2023.
1. FINANCIAL PERFORMANCE (STANDALONE & CONSOLIDATED)
|
(INR in Crores) |
||||
|
Particulars |
For the Year |
For the Year |
For the Year |
For the Year |
|
ended |
ended |
ended |
ended |
|
|
31.03.2023 |
31.03.2023 |
31.03.2022 |
31.03.2022 |
|
|
(Standalone) |
(Consolidated) |
(Standalone) |
(Consolidated) |
|
|
Revenue from Operations |
547.92 |
558.18 |
505.01 |
504.46 |
|
Other Income |
5.57 |
5.58 |
6.98 |
6.98 |
|
Total Income |
553.49 |
563.76 |
511.99 |
511.44 |
|
Profit before tax |
76.71 |
77.62 |
71.39 |
71.40 |
|
Provision for taxation (incl. deferred tax) |
19.27 |
19.32 |
20.32 |
20.32 |
|
Profit for the year |
57.44 |
58.30 |
51.07 |
51.08 |
|
Other comprehensive income for the year |
(0.16) |
(0.63) |
1.23 |
1.00 |
|
Total comprehensive income for the year |
57.28 |
57.67 |
52.30 |
52.08 |
The standalone and consolidated financial statements for the financial year ended March 31, 2023, forming part of this Annual Report, have been prepared in accordance with the Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs.
2. KEY HIGHLIGHTS OF THE FINANCIAL PERFORMANCE/ STATE OF THE COMPANY''S AFFAIRS
During the year under review, the Company achieved consolidated revenue from operations of INR 558.18 Crores as against INR 504.46 Crores in the previous year.
The total Standalone Income for the Quarter ended (QE) March 31, 2023 stood at INR 134.34 Crores versus INR 157.06 Crores for QE March 2022.
The Company''s Standalone Net Profit after Tax (NPAT) for year ended March 31, 2023 stood at INR 57.44 Crores versus INR 51.07 Crores for year ended March 31, 2022, depicting a growth of 12% y-o-y basis and the Consolidated NPAT for year ended March 31, 2023 stood at INR 58.30 Crores as against NPAT of INR 51.08 Crores for year ended March 31, 2022.
During the year under review, the Board of Directors had declared an Interim Dividend for the Financial year 2022-23, on May 27, 2022 of INR 0.50 (Fifty Paise) per Equity Share (i.e. 5%) of the face value of INR 10/- each.
The Board of Directors have decided to retain the resources to fuel the growth and objectives of the
Company and therefore do not recommend dividend for the financial year ended March 31, 2023. The Directors are confident to derive optimum utilization out of the same, which shall be in the best interest of the stakeholders.
The Authorised Share Capital of the Company is INR 26,00,00,000/- divided into 2,60,00,000 equity shares of face value of INR 10/- each. The paid-up share capital of the Company is INR 24,31,90,000/- divided into 2,43,19,000 equity shares of face value of INR 10/- each.
During the F.Y. 2022-23 there was no change in the share capital of the Company.
5. LISTING OF EQUITY SHARES ON NATIONAL STOCK EXCHANGE OF INDIA
The equity shares of the Company are listed on the Main Board of National Stock Exchange of India Limited (NSE), with effect from the trading hours of Friday, November 18, 2022. Your Company is now Listed on both Major Stock Exchanges in India i.e., NSE and BSE Limited.
There were no appropriations to reserves/ general reserves during the year under review. The closing balance of the retained earnings of the Company for the FY 2022-23 is Rs. 135.46 Crores.
7. DEPOSITS/ LOANS FROM DIRECTORS
The Company has not accepted any deposits from the public falling within the ambit of Section 73 and 76 of the Companies Act, 2013 ("the Act") and the Companies (Acceptance of Deposits) Rules, 2014, or under Chapter V of the Act. The Company has not accepted any deposit or any loan from the directors during the year under review.
8. SUBSIDIARY OR ASSOCIATE OR JOINT VENTURE COMPANY
The Company has two wholly owned subsidiaries as on March 31, 2023, namely:
The Company has a wholly owned subsidiary (WOS) in USA viz. Faze Three US LLC which is a front office of the Company in USA and is actively engaged in sourcing local business within USA for supplying the Company''s range of products to stores/ retailers.
The Total Income of WOS for FY 2022-23 stood at USD 1.84 MN vs USD 1.37 MN for FY 2021-22. The PAT for FY 2022-23 stood at USD 0.039 MN as against PBT USD 0.004 MN during previous year.
ii. Mats and More Private Limited
The Company has a wholly owned subsidiary (WOS) incorporated in India viz. Mats and More Private Limited. The WOS is engaged in the business of manufacturing, import, export and dealing in patio mats, floor covering, indoor and outdoor furnishing products including other furnishing products.
The Total Income of WOS for FY 2022-23 stood at INR 2.62 Crores. The PBT for FY 2022-23 stood at INR 0.05 Crores.
Pursuant to the provisions of Section 129(3) of the Act, a statement containing salient features of financial
statements of the WOS in Form AOC-1 forms part of this Annual Report. Copies of the financial statements of the subsidiary companies are available on the Company''s website at https://www.fazethree.com/financial-result/.
During the period under review, no company has become or ceased to be Subsidiary, Associate or Joint Venture of the Company.
9. DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 134(3)(c) of the Act, with respect to the Director''s Responsibility Statement, the Directors hereby confirm that:
(i) in the preparation of the Annual Financial Statements for the year ended March 31, 2023, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
(ii) such accounting policies as mentioned in Notes to Financial Statements have been selected and applied consistently and judgements and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the Profit of the Company for the year ended on that date;
(iii) proper and sufficient care have been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) the Annual Financial Statements have been prepared on a going concern basis;
(v) proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;
(vi) proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.
10. NUMBER OF MEETINGS OF THE BOARD AND ITS COMMITTEES
The Board and Committees of the Board meets at regular intervals to discuss and decide on Company/ Business policy and strategy apart from other Board business. In case of a urgent business need, where the meeting of the Board of Directors is not envisaged, the Board''s approval is taken by passing resolutions by circulation, as permitted by law, which are noted and confirmed in the subsequent Board Meeting.
The details of number of Board and Committee meetings of the Company are set out in the Corporate Governance Report, which forms part of this Report.
11. CHANGES IN DIRECTORS AND/ OR KEY MANAGERIAL PERSONNEL
In accordance with Section 152 of the Act, Mr. Sanjay Anand, Whole Time Director (DIN: 01367853) is liable to retire by rotation and being eligible has offered himself for re-appointment. The Board recommends his re-appointment to the shareholders at the ensuing Annual General Meeting.
During the year under review following changes took place in the position of Directorship and Key Managerial Personnel:
i. Mr. James Barry Leonard (DIN: 09744803) and Mr. Chuji Kondo (09744760) were appointed as the Non-Executive Independent Directors of the Company, for the period of five consecutive years with effect from October 05, 2022;
ii. Mr. Kartik Jethwa (DIN: 08587759) resigned as the Non-Executive Independent Director of the Company with effect from October 05, 2022, due to personal reasons;
iii. Mr. Nikhil Daga was appointed as the Company Secretary & Compliance Officer of the Company with effect from September 15, 2022 in place of Mr. Akram Sati who resigned from the position of Company Secretary & Compliance Officer with effect from the closure of business hours of August 31, 2022;
iv. Ms. Samruddhi Varadkar was appointed as the Company Secretary & Compliance Officer of the Company with effect from February 03, 2023 in place of Mr. Nikhil Daga who resigned from the position of Company Secretary & Compliance Officer with effect from the closure of business hours of February 02, 2023.
There was no other change in the composition of the Board of Directors, Key Managerial Personnel and
the Board Committees during the year under review.
Following are the Key Managerial Personnel as on March 31, 2023:
|
Mr. Ajay Anand |
: Managing Director |
|
Mr. Sanjay Anand |
: Whole-time Director |
|
Mr. Ankit Madhwani |
: Chief Financial Officer |
|
Ms. Samruddhi Varadkar |
: Company Secretary & Compliance Officer |
The Company has complied with the requirements of having Key Managerial Personnel as per the provisions of Section 203 of the Act.
12. PERFORMANCE EVALUATION OF BOARD
Pursuant to Section 178 of the Act read with Schedule IV thereto and Regulation 17 of the Securities and Exchange Board of India ("SEBI") (Listing Obligations and Disclosure Requirements), Regulations 2015 ("Listing Regulations"), a formal evaluation of Board''s performance and that of its Committees and individual directors has been carried out by the Board.
The evaluation of all the directors including independent directors was carried out by the entire Board, except for the director being evaluated. The performance is evaluated after seeking inputs from all the Directors on the basis of the criteria such as the Board composition and structure, experience and competencies, attendance, effectiveness of board processes, information and functioning, independent approach, etc. The above criteria are broadly based on the Guidance Note on Board Evaluation issued by the SEBI on January 05, 2017.
The performance of the Committees was evaluated by the Board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, attendance of the members, recommendations to the Board and their implementation, effectiveness of committee meetings, etc.
The Independent Directors at their meeting held on September 16, 2022 evaluated the performance of the Non-Independent Directors and the Board as a whole, the Chairman of the Board after considering the views of other Directors and assessed the quality, quantity and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform their duties.
The Board of Directors expressed their satisfaction to the outcome of the aforesaid evaluations.
13. DECLARATION BY INDEPENDENT DIRECTORS
All Independent Directors have submitted requisite declarations confirming that they (i) meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations and are independent; (ii) have complied with the Code of Conduct laid down under Schedule IV of the Act and (iii) they have registered themselves with the Independent Director''s Database maintained by the Indian Institute of Corporate Affairs.
During the year under review, Mr. James Barry Leonard (DIN: 09744803) and Mr. Chuji Kondo (09744760) were appointed as the Non-Executive Independent Directors of the Company, for the period of five consecutive years with effect from October 05, 2022. In the opinion of the Board, Mr. Leonard and Mr. Kondo, hold the highest standards of integrity and possess requisite expertise and experience required to fulfill their duties as Independent Directors. Further, the Independent Directors would appear for the online proficiency test which is conducted by Indian Institute of Corporate Affairs, within the timeline prescribed under Rule 6 of The Companies (Appointment and Qualifications of Directors) Rules, 2014.
14. FAMILIARIZATION PROGRAMME FOR THE INDEPENDENT DIRECTORS
The Board members are provided with necessary documents, reports and internal policies to enable them to familiarise with the Company''s procedures and practices.
Pursuant to the SEBI regulations, the Company organises Familiarization Programme periodically for the Independent Directors, with a view to familiarize them with their role, rights and responsibilities in the Company, nature of industry in which the Company operates, business model of the Company, etc. The Board familiarization process comprises of the induction programme for new Independent Directors, sessions on business and functional issues and strategy making. Periodic presentations are made at the Board and Committee meetings on business and performance updates of the Company including finance, sales, and overview of business operations, business strategy and risks involved.
During the year under review, the Independent Directors were familiarized on business model, key updates on business performance, and legal/ regulatory updates at Board Meetings as well as through periodic reports.
The policy for Familiarization Programme for the Independent Directors is available on website of the Company at https://www.fazethree.com/corporate-governance/.
15. DISCLOSURE RELATING TO REMUNERATION TO DIRECTORS, KEY MANAGERIAL PERSONNEL AND PARTICULARS OF EMPLOYEES
Disclosure pertaining to remuneration of employees as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to the Report as Annexure I.
The information required pursuant to Section 197 of the Act read with Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided on request. In terms of Section 136 of the Act, the reports and accounts are being sent to the shareholders and others entitled thereto, excluding the said information, which will be made available for inspection by the shareholders in electronic mode, up to the date of AGM. Members can inspect the same by sending an email to the Company Secretary in advance at cs@fazethree.com .
As on March 31, 2023, the Company has no employee who:
(i) if employed throughout the financial year, was in receipt of remuneration, in aggregate of INR 102.00 Lakhs or more, per annum or
(ii) if employed for part of the financial year, was in receipt of remuneration, in aggregate of INR 8.50 lakhs or more, per month
(iii) if employed throughout the financial year or part thereof, was in receipt of remuneration in that year which, in the aggregate, or as the case may be, at a rate which, in the aggregate, is in excess of that drawn by the managing director or whole-time director or manager and holds by himself or along with his spouse and dependent children, not less than two percent of the equity shares of the company.
Pursuant to the provisions of Sections 134(3)(a) and 92(3) of the Act read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the draft Annual Return as of March 31, 2023, is placed on the website of the Company at https://www.fazethree.com/corporate-governance/
The Audit Committee of the Board of Directors of the Company is duly constituted pursuant to Section 177 of the Act and Regulation 18 of Listing Regulations.
As on March 31, 2023, the Audit Committee comprises of 3 (three) members namely Mr. Vinit Rathod (Chairman), Mr. Ajay Anand (Member) and Mr. Manan Shah (Member). Other details pertaining to the Audit Committee are included in the Corporate Governance Report, which forms part of this report. All the Members of the Committee are adequately literate to understand the financial and other aspects. All the recommendations made by the Committee during the period were accepted by the Board.
18. NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee of the Board of Directors of the Company is duly constituted pursuant to Section 178(1) of the Act and Regulation 19 of Listing Regulations.
The Nomination and Remuneration Committee is responsible for evaluating the balance of skills, experience, independence, diversity and knowledge on the Board and for drawing up selection criteria. The Board of Directors of the Company has defined a policy on Director''s appointment and payment of remuneration including criteria for determining qualifications, positive attributes and independence of Directors and terms of reference of the Committee which is available on the website of the Company at https://www.fazethree.com/policies/.
As on March 31, 2023, the Nomination & Remuneration Committee comprised of 3 (three) members all being Non-Executive Directors namely Mr. Vinit Rathod (Chairman), Mrs. Rashmi Anand (Member) and Mr. Manan Shah (Member). All the recommendations made by the Committee during the period were accepted by the Board.
19. STAKEHOLDERS'' RELATIONSHIP COMMITTEE
The Stakeholders'' Relationship Committee of the Board of Directors of the Company is duly constituted pursuant to Section 178(5) of the Act and Regulation 20 of the Listing Regulations.
As on March 31, 2023, the Stakeholders Relationship Committee comprises of 3 (three) members namely Mr. Vinit Rathod (Chairman), Mr. Ajay Anand (Member) and Mr. Manan Shah (Member). Other details pertaining to the Committee are included in the Corporate Governance Report, which forms part of this report.
20. CORPORATE SOCIAL RESPONSIBILITY STATEMENT (CSR)
The business cannot exist in isolation and for a business to be profitable, it needs to consider the Social Responsibility in order to build a positive synergy between the two. The Company has always considered Social Responsibility as an integral part of sustainable growth and has been over the years contributing towards it in various ways. The management of the Company endeavors for the upliftment of the society and the natural resources which are essential for overall economic growth.
During the FY 2022-23, the Company was required to spent INR 85,52,667/- towards the CSR contribution. The Board of Directors of the Company pursuant to the Rule 7(3) of the Companies (Corporate Social Responsibility Policy) Rules, 2014 and on the recommendation of the CSR Committee, approved to the set off the excess available CSR contribution against the CSR contribution to be spent in FY 2022-23.
The brief outline of the Corporate Social Responsibility (CSR) policy of the Company and the annual report on Corporate Social Responsibility (CSR) activities as per format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014, is annexed as Annexure II to this report.
The CSR policy has been posted on the website of the Company at https://www.fazethree.com/policies/.
21. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION
The information as required under Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption and foreign exchange earnings and outgoings is annexed to this report as Annexure III.
22. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the financial year, the Company has entered into transactions with related parties as defined under Section 2(76) of the Act and Listing Regulations. All related party transactions were carried out at arm''s length price and in the ordinary course of business.
The Members of the Company, vide resolution passed through the postal ballot on December 14, 2022, approved the potential Material Related Party Transactions under the Regulation 23 of the Listing Regulations, with Faze Three Autofab Limited for FY 2022-23 and FY 2023-24, at an arm''s length basis and in the ordinary course of business.
All Related Party Transactions are approved by Audit Committee. Prior omnibus approval is obtained from the Audit Committee in respect of the transactions which are repetitive in nature. The transactions entered into pursuant to omnibus approval so granted are reviewed on a quarterly basis by the Audit Committee.
As per the SEBI Listing Regulations, if any related party transaction exceeds Rs 1,000 crore or 10% of the annual consolidated turnover as per the last audited financial statement whichever is lower, would be considered as material and require Members approval. In this regard, during the year under review, the Company had taken necessary Members approval. However, there were no material transactions of the Company with any of its related parties as per the Act. Therefore, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Act in Form AOC-2 is not applicable to the Company for FY23 and, hence, the same is not required to be provided.
Suitable disclosure as required by the Indian Accounting Standards (IND AS 24) has been made in the notes to the Financial Statements. The Company shall seek shareholders'' approval for material related party transactions proposed to be entered in the upcoming financial year in the ensuing AGM.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is available at https://www.fazethree.com/policies/ .
23. MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY
There are no material changes or commitments, affecting the financial position of the Company which has occurred between the end of the financial year of the Company i.e. March 31, 2023 and the date of the Directors'' report.
24. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a Whistle Blower Policy and has established the necessary vigil mechanism for directors and employees in confirmation with Section 177(9) of the Act and Regulation 22 of Listing Regulations, to report concerns about unethical behavior and provide appropriate avenues to the Directors and employees to bring to the attention of the management any issue which is perceived to be in violation of or in conflict with the Code of Conduct of the Company and to report concerns about unethical behavior. No person has been denied access to the Chairman of the Audit Committee. The said policy has been posted on the website of the Company at https://www.fazethree.com/policies/.
During the year under review, no complaint or adverse reporting was received by the designated officer of the Company.
25. DISCLOSURE AS PER SEXUAL HARRASMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL) ACT, 2013
The Company has zero tolerance towards sexual harassment at the workplace. The Company has adopted Prevention of Sexual Harassment Policy in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder.
The Company has complied with the provisions relating to the constitution of the Internal Committee as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
The Company has not received any complaint or adverse reporting during the year.
The Company has in place a mechanism to inform Board of Directors about the Risk assessment and risk minimization procedures and periodical reviews to ensure that risk is controlled by the management through the means of a properly laid-out framework. The Audit Committee has additional oversight in the area of financial risks and controls. The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis.
27. INTERNAL FINANCIAL CONTROLS
The Company has adequate internal control systems, commensurate with the size, scale and complexity of its operations, which monitors business processes, financial reporting and compliance with applicable regulations. The systems are periodically reviewed for identification of control deficiencies and formulation of time bound action plans to improve efficiency at all the levels.
28. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is enclosed as Annexure IV.
The Company believes in transparency and adhering to good corporate governance practices in every sphere of its operations. The Company has taken adequate steps to comply with the applicable provisions of Corporate Governance as stipulated in Listing Regulations. A report on Corporate Governance is annexed to this report as Annexure V.
30. AUDITORS AND THEIR REPORTA. STATUTORY AUDITORS AND AUDITORS'' REPORT
M/s. MSKA & Associates Chartered Accountants (Firm Registration No. 105047W), were appointed as the Statutory Auditor by the Members of the Company at the 37th Annual General Meeting of the Company, for a period of 5 years and shall hold the office till the conclusion of the 42nd Annual General Meeting of the Company, to be held in the calendar year 2027.
The Auditor''s Report on IND AS financial statements (standalone and consolidated) of the Company for the FY 2022-23, as submitted by M/s. MSKA & Associates, Chartered Accountants, did not contain any qualifications, reservations or adverse remarks and are self-explanatory.
There have been no instances of fraud reported by the Auditors under Section 143(12) of the Act and Rules framed thereunder either to the Company or to the Central Government.
Pursuant to the provisions of Section 204 of Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has undertaken Secretarial Audit for the FY 2022-23 by appointing M/s. Sanjay Dholakia & Associates, Practicing Company Secretary, which, inter alia, includes audit of compliance with the Companies Act, 2013, and the Rules made thereunder, SEBI Listing Regulations and other Regulations and Acts applicable to the Company. The Secretarial Audit Report is annexed to this report as Annexure VI.
The Secretarial Auditors'' Report for the financial year ended March 31, 2023, does not contain any reservation, qualification or adverse remark. There is no fraud reported by the Secretarial Auditor during the year under review as per Section 143(12) of the Act and Rules framed thereunder either to the Company or to the Central Government.
The Board of Directors at their meeting held on May 23, 2023, has appointed M/s. Sanjay Dholakia & Associates, Practicing Company Secretaries (Certificate of Practice No. 1798), as the Secretarial Auditor for FY 2023-24.
31. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
Details of loans, guarantees and investments covered under Section 186 of the Act, are provided in the notes to the financial statements.
32. DISCLOSURE ON ACCOUNTING TREATMENT
The Company has not used any differential treatment which is not in compliance with Accounting Standards and the financials of the Company depict a true and fair view of the state of affairs of the Company.
33. FRAUD REPORTED BY THE AUDITORS, IF ANY
There is no fraud reported by the Auditors during the year under review as per Section 143(12) of the Companies Act, 2013.
The Company maintains the cost records of its products as per the provisions of sub-section (1) of Section 148 of the Act. Pursuant to the provisions of Rule 4(3)(i) of the Companies (Cost Records and Audit) Rules, 2014 the requirement of Cost Audit is not applicable to the Company.
During the year under review, the Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.
36. SIGNIFICANT MATERIAL ORDERS PASSED BY COURTS, IF ANY
There are no significant material orders passed by the Regulators/ Courts against the Company which would impact the going concern status of the Company and its future operations.
37. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT ("BRSR")
Pursuant to Regulation 34(2)(f) of the Listing Regulations, the initiatives taken by the Company from an environmental, social and governance perspective, are provided in the Business Responsibility and Sustainability Report ("BRSRâ) for the financial year 2022-23 which is included as a separate section in the Annual Report. The Company has prepared the BRSR report on voluntary basis.
38. POLICIES UNDER LISTING REGULATIONS
The SEBI Listing Regulations mandated the formulation of certain policies for all listed Companies which are as under.
a. Documents Retention & Archival Policy'' as per Regulation 9 and Regulation 30 which may be viewed at https://www.fazethree.com/policies/
b. Policy for determining Materiality of events / information'' as per Regulation 30 which may be viewed at https://www.fazethree.com/policies/
c. Policy for determining material subsidiary'' as per Regulation 16(1)(c) of the Listing Regulations which may be viewed at https://www.fazethree.com/policies/
⢠There was no change in the nature of the business of the Company during the year under review.
⢠The Company has not issued any shares with differential voting during the year under review.
⢠There were no revisions in the financial statements from the end of the Financial Year to date of the Director Report.
⢠The Company has neither issued any shares nor granted any Stock Options nor any Sweat Equity Shares during the year.
⢠No application has been made under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) ("the IBC, 2016"), hence, the requirement to disclose the details of application made or any proceeding pending under the IBC, 2016 during the year along with their status as at the end of the financial year is not applicable.
⢠The requirement to disclose the details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable during the year under review.
⢠There are no amounts due and outstanding to be credited to Investor Education and Protection Fund as on March 31, 2023.
Your Directors wish to place on record their appreciation for the co-operation extended by all the
employees, Bankers, Financial Institutions, various State and Central Government authorities and
Stakeholders.
Mar 31, 2018
The Directors have pleasure in presenting the 33rd Annual Report of your Company containing the business performance and the Audited Financial Statements for the year ended on 31st March 2018.
1. FINANCIAL PERFORMANCE (Standalone & Consolidated):
(Rs. in Crores)
|
Particulars |
For the Year ended 31.03.2018 (Standalone) |
For the Year ended 31.03.2018 (Consolidated) |
For the Year ended 31.03.2017 (Standalone) |
|
Revenue from Operations |
239.87 |
239.87 |
243.77 |
|
Other Income |
10.63 |
10.63 |
22.90 |
|
Profit before tax |
15.54 |
15.54 |
27.27 |
|
Provision for taxation (incl. deferred tax) |
(1.29) |
(1.29) |
(10.59) |
|
Profit for the year |
16.83 |
16.83 |
37.86 |
|
Other comprehensive income for the year |
0.17 |
0.17 |
0.26 |
|
Total comprehensive income for the year |
16.66 |
16.66 |
37.60 |
The standalone and consolidated financial statements for the financial year ended March 31, 2018, forming part of this Annual Report, have been prepared in accordance with the Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs.
2. KEY HIGHLIGHTS OF THE FINANCIAL PERFORMANCE:
During the year under review, the Company earned revenue from operations of Rs. 239.87 Crores as against Rs. 243.77 Crores in the previous year. The Company achieved Net Profit of Rs. 16.83 crores as against Net Profit of Rs. 37.86 Crores during previous year.
3. DIVIDEND:
Your directors are pleased to announce that the Board of Directors of the Company has declared an Interim Dividend of Rs. 0.50/- per share of Rs. 10/- each (5%) for FY 2017-18 considering the performance during the year to the shareholders who shall be on the register of members on June 2, 2018.
4. SHARE CAPITAL:
Preferential Issue of equity shares & convertible equity warrants
During the year under review the Company on April 7, 2017 allotted by way of Preferential allotment 3,19,000 equity shares of Rs. 10/- each and 8,45,500 equity warrants convertible into equal number of equity shares of Rs. 10/- each to promoter/ non promoter investors.
Out of the said 8,45,500 convertible equity warrants, 7,00,000 warrants were converted into equal number of equity shares ranking paripassu with the existing equity shares of the Company on December 26, 2017 upon receipt of balance subscription amount from the allottee to exercise the conversion. Consequently the paid up equity capital of the Company as at March 31, 2018 stood at Rs. 24,31,90,000/- consisting of 2,43,19,000 equity shares of Rs. 10/- each.
5. RESERVES:
There were no appropriations to reserve/ general reserve during the year under review.
6. DEPOSITS:
The Company has not accepted any deposits from the public falling within the ambit of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014, or under Chapter V of the Companies Act, 2013.
7. SUBSIDIARY COMPANY:
During the year under review, the Company formed a wholly owned subsidiary (WOS) in USA namely Faze Three US LLC and invested Rs. 2.43 crore for the set up. The said WOS is held as a front end of the Company in USA and is actively engaged in sourcing local business within USA for supplying the Company''s range of products to stores/ retailers. Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of financial statements of the WOS in Form AOC 1 is attached to the Consolidated Financial Statements. The separate audited financial statements in respect of the WOS are also available on the website of the Company.
8. DIRECTORS'' RESPONSIBILITY STATEMENT:
Pursuant to the requirements of Section 134(3)(c) of the Companies Act, 2013, with respect to the Director''s Responsibility Statement, the Directors hereby confirm that:
(i) in the preparation of the Annual Financial Statements for the year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
(ii) such accounting policies as mentioned in Notes to Financial Statements have been selected and applied consistently and judgments and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of the Profit of the Company for the year ended on that date;
(iii) proper and sufficient care have been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) the Annual Financial Statements have been prepared on a going concern basis;
(v) proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;
(vi) systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.
9. NUMBER OF MEETINGS OF THE BOARD AND AUDIT COMMITTEE:
The Board and Committees of the Board meets at regular intervals to discuss and decide on Company / Business policy and strategy apart from other Board business. In case of a special and urgent business need, the Board''s approval is taken by passing resolutions by circulation, as permitted by law, which are noted and confirmed in the subsequent Board Meeting.
The details of number of Board and Committee meetings of the Company are set out in the Corporate Governance Report which forms part of this Report.
10. PERFORMANCE EVALUATION OF BOARD:
The Board of Directors has carried out an annual evaluation of its own performance, Board Committees and individual Directors pursuant to the provisions of the Companies Act, 2013 and the Corporate Governance requirements as prescribed by Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations 2015. The same is found to be satisfactory.
The performance of the Board was evaluated by the Board after seeking inputs from all the Directors on the basis of the criteria such as the Board composition and structure, experience & competencies, attendance, effectiveness of board processes, information and functioning, independent approach, etc.
The performance of the Committees was evaluated by the Board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, attendance of the members, recommendations to the Board and their implementation, effectiveness of committee meetings, etc.
11. DECLARATION BY INDEPENDENT DIRECTORS:
The Company has received necessary declaration from each Independent Director under Section 149(7) of the Companies Act, 2013, that he / she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements), Regulations 2015.
12. FAMILIARIZATION PROGRAMME FOR THE INDEPENDENT DIRECTORS:
Pursuant to the SEBI regulations, the Company has worked out a Familiarization Programme for the independent Directors, with a view to familiarize them with their role, rights and responsibilities in the Company, nature of industry in which the Company operates, business model of the Company, etc. The Board familiarization process comprises of the Induction programme for new independent Directors, sessions on business and functional issues and strategy making.
The policy for Familiarization Programme for the Independent Directors is available on website of the Company.
13. DISCLOSURE RELATING TO REMUNERATION TO DIRECTORS, KEY MANAGERIAL PERSONNEL AND PARTICULARS OF EMPLOYEES:
As required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personal) Rules, 2014, as amended from time to time, details of Remuneration to Directors and Key Managerial Personnel is provided in Form MGT-9 annexed to this Report.
The Company has no employee who- (i) if employed throughout the financial year, was in receipt of remuneration, in aggregate, more than Rs. 102.00 Lacs, or (ii) If employed for part of the financial year, was in receipt of remuneration, in aggregate, more than Rs 8.50 lacs per month.
14. AUDIT COMMITTEE:
The Audit Committee comprises of three members namely Mr.VinitRathod (Chairman), Mr.Manan Shah and Mr. Ajay Anand. Other details pertaining to audit committee are included in the Corporate Governance Report, which forms part of this report. All the Members of the Committee are financially literate.
15. NOMINATION & REMUNERATION COMMITTEE:
The Company has constituted a Remuneration Committee pursuant to Section 178(1) of the Companies Act, 2013 and Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Nomination and Remuneration Committee is responsible for evaluating the balance of skills, experience, independence, diversity and knowledge on the Board and for drawing up selection criteria. The Board of Directors of the Company has defined a policy on Director''s appointment and payment of remuneration including criteria for determining qualifications, positive attributes and independence of Directors and terms of reference of the Committee.
The Nomination & Remuneration Committee comprises of three members all being Non-Executive Directors namely Mr.VinitRathod (Chairman), Mr.Manan Shah and Ms.Shweta Jain. All the recommendations made by the Committee during the period were accepted by the Board.
16. CORPORATE SOCIAL RESPONSIBILITY STATEMENT (CSR):
The Company during the year formed CSR Committee comprising Mr. Ajay Anand as the Chairman and Mr. Sanjay Anand and Mr.Manan Shah as members.
The said Committee has formulated and recommended to the Board of Directors, CSR Policy indicating the activities to be undertaken by the Company and monitoring and implementation of the framework of the activities. The CSR Policy is available on the website of the Company at www.fazethree.com.
Note on CSR spending as required under Section 135 of the Companies Act, 2013 and the rules framed thereunder:
The FY 2017-18 was the first year post the turnaround of the Company in 2017. The Company was unable to undertake spending of Rs. 18.21 lacs for CSR Activities as per the rules, since it was unable to find adequate avenues and was in the process of identifying areas of expending the said amount and also it was necessary for the Company to focus and pull back the available resources to the maximum extent so as to meet its operational requirements in the interest of the stakeholders including the communities around the factory locations. The management believes that upliftment of the society at large is one of the key factors of sustainable economic growth and will strive to contribute to the society by way of CSR in the coming years in a fair and ethical way so as to balance their interests along with the interests of the stakeholders.
17. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION:
The information as required under Section 134(3)(m) of The Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption and foreign exchange earnings and outgoings is annexed to this report as Annexure I.
18. RELATED PARTY TRANSACTIONS:
All transactions entered into with related party as defined under Section 188(3) of the Companies Act, 2013 and Regulation 23 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 during the financial year were in the ordinary course of business and on arm''s length price and do not attract the provisions of Section 188 of the Companies Act, 2013. All material transactions with related parties during the financial year were in the interests of the Company. Disclosure as required under IND AS 24 has been made in the notes to the financial statements. The Company has proposed to take approval of Members for all material related party transactions proposed to be entered into in the current financial year through Ordinary Resolution.
The policy on Related Party Transactions as approved by the Board is available on the website of the Company at www.fazethree.com.
Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Form AOC-2 and the same forms part of this report as Annexure II.
19. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has adopted a Whistle Blower Policy, as part of vigil mechanism as defined under Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 to provide appropriate avenues to the Directors and employees to bring to the attention of the management any issue which is perceived to be in violation of or in conflict with the Code of Conduct of the Company and to report concerns about unethical behavior. The said policy has been posted on the website of the Company at www.fazethree.com.
20. DICSLOSURE AS PER SEXUAL HARRASMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL) ACT, 2013:
Pursuant to Section 22 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 read with Rule 14, the internal committee constituted under the said act has confirmed that no complaint/ case has been filed/ pending with the Company during the year.
21. RISK MANAGEMENT:
The Company has in place a mechanism to inform Board of Directors about the Risk assessment and risk minimization procedures and periodical reviews to ensure that risk is controlled by the management through the means of a properly laid-out framework.
22. INTERNAL FINANCIAL CONTROLS:
The Company has adequate internal control systems, commensurate with the size, scale and complexity of its operations which monitors business processes, financial reporting and compliance with applicable regulations. The systems are periodically reviewed for identification of control deficiencies and formulation of time bound action plans to improve efficiency at all the levels.
23. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
Management Discussion and Analysis Report as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is enclosed as Annexure III.
24. CORPORATE GOVERNANCE:
The Company is adhering to good corporate governance practices in every sphere of its operations. The Company has taken adequate steps to comply with the applicable provisions of Corporate Governance as stipulated in SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. A report on Corporate Governance is annexed to this report as Annexure IV.
25. STATUTORY AUDITOR:
M/s. MSKA & Associates Chartered Accountants (Firm Registration No. 105047W), were appointed by the members of the Company in the 32nd Annual General Meeting for a period of 5 years i.e. till the conclusion of the 37th Annual General Meeting. In accordance with the Companies Amendment Act, 2017, enforced on 7th May, 2018 by Ministry of Corporate Affairs, the appointment of Statutory Auditors is not required to be ratified at every AGM. The appointment of M/s. MSKA & Associates as the Statutory Auditor of the Company shall continue for the FY 2018-19. M/s. MSKA & Associates has confirmed that their appointment is within the prescribed limits specified in Section 139 of the Companies Act, 2013.
26. SECRETARIAL AUDITOR:
The Company has undertaken Secretarial Audit for the financial year 2017-18 which, inter alia, includes audit of compliance with the Companies Act, 2013, and the Rules made thereunder, Listing Regulations and other applicable Regulations and Acts. The Secretarial Audit Report is annexed to this report as Annexure V. Pursuant to the provisions of Section 204 of Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. Sanjay Dholakia& Associates, Practicing Company Secretary to undertake Secretarial Audit for the financial year 2018-19.
27. OBSERVATIONS - STATUTORY AUDITOR & SECRETARIAL AUDITOR:
Statutory Auditor:
The Auditors'' Report to the Members does not contain any reservation, qualification or adverse remark.
Secretarial Auditor:
The Secretarial Audit Report to the Members does not contain any reservation, qualification or adverse remark.
28. COST AUDIT AND RECORDS:
The provisions of sub-section (1) of section 148 of the Act are not applicable to the Company as the Central Government of India has not specified the maintenance of cost records for any of the products of the Company.
As regards to Cost Audit, vide notification issued by Government on 31st December 2014, the Company is not required to conduct a Cost Audit.
29. EXTRACT OF ANNUAL RETURN:
The details forming part of extract of the annual return in Form MGT-9 is annexed to this report as Annexure VI.
30. INDIAN ACCOUNTING STANDARDS (IND AS):
The Indian Accounting Standards (IND AS) were notified by the Ministry of Corporate Affairs on February 16, 2015. The Company has adopted IND AS with effect from 1st April, 2017 with comparatives for the previous year ending 31st March, 2017. Your Company has taken adequate steps in this regard and has ensured a smooth transition to IND AS.
31. SIGNIFICANT MATERIAL ORDERS PASSED BY COURTS:
There are no significant material orders passed by the Regulators/ Courts which would impact the going concern status of the Company and its future operations.
32. ACKNOWLEDGMENT:
Your Directors wish to place on record their appreciation for the co-operation extended by all the employees, Bankers, Financial Institutions, various State and Central Government authorities and Stakeholders.
For and on behalf of the Board
For Faze Three Limited
Place: Mumbai Ajay Anand
Date: 22nd May, 2018 Chairman & Managing Director
Mar 31, 2015
Dear Shareholders,
The Directors are presenting the 30th Annual Report of your Company and
the Audited Financial Statements for the year ended 31st March 2015.
1. FINANCIAL RESULTS:
(Rs. in Lacs)
Particulars For the Year For the Year
ended ended
31.03.2015 31.03.2014
Revenue from Operations 21762.07 23068.95
Other Income 231.14 253.37
Profit before Depreciation &
Amortization, Finance Cost
and Exceptional Items 1806.10 2549.02
Less:
Depreciation & Amortization 492.05 494.49
Finance Cost 1418.45 1475.66
Exceptional Items 325.79 716.79
Profit / (Loss) before taxation (430.19) (137.91)
Provision for taxation (incl. deferred tax) - 15.48
Profit/ (Loss) for the year carried
to Balance Sheet (430.19) (153.39)
2. OPERATIONS:
During the year under review, the Company's revenue from operations
stood at Rs. 21762.07 Lacs as against Rs. 23068.95 Lacs in the previous
year. The Loss Before Tax stood at Rs. 430.19 Lacs. The Company has
suffered a Net Loss of Rs. 430.19 Lacs for the financial year ended
31.03.2015.
The Company had operational profit of Rs. 1806.10 Lacs as compared to
Rs. 2549.02 Lacs in the previous year. The reduction of operational
profit is due to reduction in turnover of the Company by 6% as compared
to previous year.
As reported in earlier years the company is having liabilities towards
Foreign Currency Convertible Bonds of US $ 8 Mln and towards invocation
of Corporate Guarantee given by the Company to its Wholly owned
subsidiary company M/s. Pana Textil GmbH of Euro 4.4 Mln, which is
under liquidation process. Company has provided the liabilities in the
books of accounts towards applicable annual charge & forex fluctuation
on the said liabilities as claimed by the Bank from time to time. Due
to the said provisions the company's profitability has been adversely
affected.
3. DIVIDEND:
Due to financial losses, your company has not recommended any dividend
for the year.
4. RESERVES:
The Company has not transferred any amount to reserves due to losses in
current financial year.
5. DEPOSITS:
The Company has not accepted any deposits from the public falling
within the ambit of Section 73 of the Companies Act, 2013 and the
Companies (Acceptance of Deposits) Rules, 2014, or under Chapter V of
the Companies Act, 2013.
6. RELATED PARTY TRANSACTIONS:
All transactions entered into with related party as defined under
Section 188(3) of the Companies Act, 2013 and Clause 49 of the Listing
agreement during the financial year were in the ordinary course of
business and on arms length pricing basis and do not attract the
provisions of Section 188 of the Companies Act, 2013. There were no
materially significant transactions with related parties during the
financial year which were in conflict with the interest of the Company.
Suitable disclosure as required by the Accounting Standards (AS18) has
been made in the notes to the Financial Statements. The Company has
proposed to take approval of shareholders regarding related party
transactions entered into by the Company during financial year and
propose to be enter into with related parties in next financial year
through Special Resolution.
7. INTERNAL FINANCIAL CONTROLS:
The Company has an Internal Control System, commensurate with the size,
scale and complexity of its operations.
8. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
For the financial year under review as stipulated in Clause 49 of the
Listing Agreement entered into with the Stock Exchange, Management
Discussion and Analysis Report is Annexed thereto.
9. CORPORATE GOVERNANCE:
The Company is adhering to good corporate governance practices in every
sphere of its operations. The Company has taken adequate steps to
comply with the applicable provisions of Corporate Governance as
stipulated in Clause 49 of the Listing Agreement entered into with the
Stock Exchange. A separate report on Corporate Governance is Annexed
thereto.
10. BOARD MEETINGS:
During the year under review, the Company has conducted 8 (Eight) Board
Meetings on 1st April, 2014, 28th April, 2014, 9th May, 2014, 29th May,
2014, 14th August, 2014, 14th November, 2014, 29th December, 2014 and
13th February, 2015.
11. AUDIT COMMITTEE:
The Audit Committee comprises of four members namely Mr. Vasudeva Rao
(Chairman), Mr. Rajiv Rai Sachdev, Mr. Ajay Anand and Mr. Sanjay Anand.
All the recommendations made by the Audit Committee were accepted by
the Board.
The Audit Committee met 4 (Four) times in the year on 29th May, 2014,
14th August, 2014, 14th November, 2014 and 13th February, 2015.
12. REMUNERATION COMMITTEE:
The Company has constituted a Remuneration Committee pursuant to
Section 178(1) of the Companies Act, 2013 and has defined the policy on
Director's appointment and payment of remuneration including criteria
for determining qualifications, positive attributes and independence of
a Directors.
The Remuneration Committee comprises of two members namely Mr. Vasudeva
Rao (Chairman) and Mr. Rajiv Rai Sachdev. All the recommendations made
by the Committee were accepted by the Board.
13. SUBSIDIARY COMPANY:
The Company's Wholly owned subsidiary company M/s. Pana Textil GmbH has
filed an insolvency petition in the German Court. The German court has
completed the insolvency proceedings and the company is in the process
of liquidation.
14. EXTRACT OF ANNUAL RETURN:
The details forming part of extract of the annual return in Form MGT -
9 is Annexed to this report.
15. DIRECTORS' RESPONSIBILITY STATEMENT:
To the best of their knowledge and belief and according to the
information and explanations obtained by them, your directors make the
following statement in terms of Section 134 (3) (c) of the Companies
Act, 2013:
(i) that in the preparation of the Annual Financial Statements for the
year ended March 31, 2015, the applicable accounting standards have
been followed along with proper explanation relating to material
departures, if any;
(ii) that such accounting policies as mentioned in Notes to Financial
Statements have been selected and applied consistently and made
judgments and estimates have been made that are reasonable and prudent
so as to give a true and fair view of the state of affairs of the
Company as at March 31, 2015 and of the loss of the Company for the
year ended on that date;
(iii) that proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Companies
Act, 2013 for safeguarding the assets of the Company and for preventing
and detecting fraud and other irregularities;
(iv) that the Annual Financial Statements have been prepared on a going
concern basis;
(v) that the proper internal financial controls were in place and that
the financial controls were adequate and were operating effectively;
(vi) that systems to ensure compliance with the provisions of all
applicable laws were in place and were adequate and operating
effectively.
16. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION ETC. & FOREIGN
EXCHANGE EARNINGS AND OUTGOINGS:
The information as required under Section 134(3)(m) of The Companies
Act, 2013 read with Rule 8(3) of The Companies (Accounts) Rules, 2014
with respect to conservation of energy, technology absorption and
foreign exchange earnings and outgoings is annexed to this report.
17. RISK MANAGEMENT POLICY:
The Company has in place a mechanism to inform Board of Directors about
the Risk assessment and risk minimization procedures and periodical
reviews to ensure that risk is controlled by the Management through the
means of a properly laid-out framework.
18. CORPORATE RESPONSIBILITY STATEMENT (CSR):
The company is not required to comply with section 135 of Companies
Act, 2013 along with rules made in this behalf as company is having
negative Networth and is incurring losses since last 4 years.
19. PERFORMANCE EVALUATION OF BOARD:
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement, the Board has carried out an annual performance
evaluation of its own performance, the directors individually as well
as the evaluation of the working of its Audit, Remuneration and other
Committees. The same is found to be satisfactory.
20. DECLARATION FROM INDEPENDENT DIRECTORS:
The Company has received necessary declaration from Independent
Director of the Company Mr. Vasudeva Rao. Under Section 149(7) of the
Companies Act, 2013, he meets the criteria of independence laid down in
Section 149(6) of the Companies Act, 2013.
21. STATUTORY AUDITORS:
M/s. Thakur Vaidyanath Aiyar & Co., Chartered Accountants, Mumbai (Firm
Rgn. No. 000038N) being eligible offer themselves for re-appointment.
M/s. Thakur Vaidyanath Aiyar & Co. has confirmed that the appointment
will be within the prescribed limits specified in Section 139 of the
Companies Act, 2013. Members are requested to appoint the auditors.
22. SECRETARIAL AUDIT:
Pursuant to the provisions of Section 204 of Companies Act, 2013 and
the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, the Company has appointed M/s. Sanjay Dholakia &
Associates, Practicing Company Secretary to undertake Secretarial
Audit. The Report is annexed to this Annual Report.
23. OBSERVATIONS Â AUDITOR & SECRETARIAL AUDITOR:
Statutory Auditor:
As regards to qualifications contained in the Auditors Report, the
Auditor's views are self-explanatory. The Board of Directors shall take
necessary steps towards depreciation calculation as per Companies Act,
2013 in the following Financial year.
Secretarial Auditor:
As mentioned in the report, the Company was required to appoint a Chief
Financial Officer (CFO as KMP) and a Woman Director on the Board. Your
Directors would like to inform you that the Company is still in the
process of appointing the same.
24. COST RECORDS:
Pursuant to the directives of the Central Government under the
provisions of Section 148(1) of Companies Act, 2013, Company has
maintained cost records and included the same in Books of Accounts.
25. ACKNOWLEDGMENT:
Your Directors wish to place on record their appreciation for the
co-operation extended by all the employees, Bankers, Financial
Institutions, various State and Central Government authorities and
Stakeholders.
For and on behalf of the Board
FOR FAZE THREE LIMITED
Place: Mumbai
Date : 30th May, 2015 Ajay Anand
Chairman & Managing Director
Mar 31, 2014
Dear Members,
The Directors present the 29th Annual Report of the Company together
with its Audited Statement of Profit and Loss for the year ended March
31, 2014 and the Balance Sheet as on that date:
FINANCIAL RESULTS (Rs. Lacs)
Particulars For the Year For the Year
ended ended
31.03.2014 31.03.2013
Revenue from Operations (net) 23068.95 18880.50
Other Income 253.37 525.28
Profit before interest, tax, depreciation
& amortization, finance cost and exceptional 2549.03 772.17
items
Depreciation & amortization expenses 494.49 489.87
Finance Cost/Interest 1475.66 1469.99
Exceptional items 716.79 917.30
Profit/(Loss) Before Tax (137.91) (2104.99)
Less: Tax Expenses
Deferred Tax 15.48 45.96
Profit/ (Loss) After Tax (153.39) (2150.95)
COMPANY OPERATIONS
The revenue from operations stood at Rs. 23,068.95 Lacs as against Rs.
18,880.50 Lacs during the previous year. The revenue from other income
stood at Rs. 253.37 Lacs as against Rs. 525.28 Lacs during the previous
year.
During the year under review, the Company earned a profit of Rs.
2,549.03 Lacs before interest, tax, depreciation & amortization,
finance cost and exceptional items as against of Rs. 772.17 Lacs in the
previous year. However, the Company has suffered a net loss of Rs.
153.39 Lacs as against the loss of Rs. 2,150.95 Lacs during the
previous year.
The Company's revenue from Exports has increased from Rs. 15,589.73
Lacs to Rs. 19,135.22 Lacs, a significant growth of 23% from previous
year.
DIVIDEND
In view of the losses reported by the Company, your Directors have not
recommended any dividend.
PERFORMANCE REVIEW
The FY 2012-13 has been an extremely challenging year for the Company.
The slow recovery of the US economy, continued crisis in the Euro-zone
and the slowdown in the Chinese economy, especially low exports of
textiles, have put pressure on the overall economy. These, coupled with
the steep increase in input cost, labour cost and inflationary trends
in the markets have adversely affected the industry as well as the
Company. A weaker Rupee against the dollar has helped the company to
have better sales realization against the export orders and reduced the
impact of various challenges in the Industry. However, the increased
cost of borrowings and provision for foreign exchange loss on
revaluation of FCCB liabilities have adversely affected the company's
profits.
BUSINESS OVERVIEW
The GDP growth in India during the year is estimated to have been
around 4.7%. Inflation was at very high levels during the first half of
the year, but has gradually come down to 6% by the end of the year. The
Indian Rupee's recent depreciation against the US$ has not been helpful
in getting the economy back on growth path. However, the ushering in of
a stable Government, post elections, has revived sentiments and lifted
investor confidence which would pave the way for growth in the current
financial year.
During the year 2013, the textile industry registered a growth of
13.91% in US$ terms and 27.04% in Rupee terms. Textiles exports have
touched US$ 41.58 billion in 2013-14 as against US$ 36.50 billion FY
2012-13. The share of textiles export in the Indian Exports Basket
significantly increased from 12.15% to 13.26% in USD during 2013-14 as
against overall Indian export growth of 4.37%.
The Indian home furnishing industry is facing tough competition from
China. However, the Industry has sustained itself through focus,
primarily on value added products, which makes it popular and distinct
across the global markets. With changing needs, innovations and also
increasing customer demands, the home furnishing industry has expanded
with many new players entering the market, but India still maintains
its stronghold in the global home furnishing market.
In spite of the adverse market conditions prevailing in the global
market and various businesses in which the Company operates, the
overall performance of the Company during the year has significantly
improved compared to that of the previous year. The overall sales of
the company has increased by 24% and the exports have increased by 23%
which is a noteworthy performance considering the subdued global
textile markets. With the global economy expected to recover
moderately, particularly on account of performance in some advanced
economies, the economy and industry is looking forward to better growth
prospects in 2014-15 and in turn the Company is expecting to sustain
its growth and perform better in the current financial year.
SUBSIDIARY COMPANY:
The Ministry of Corporate Affairs has issued direction under section
212 (8) of the Companies Act, 1956 vide general circular No. 2/ 2011
dated February 8, 2011 and in accordance with the same, the Balance
Sheet, the Profit and Loss Account and other documents of the
subsidiary companies are not being attached with the Balance Sheet of
the Company.
As reported last year, the Company's wholly owned subsidiary company of
M/s Pana Textil GmbH has filed an insolvency petition in the German
Court. The German court has completed the insolvency proceedings and
the company is in the process of liquidation.
FIXED DEPOSITS
Your Company has not accepted any deposits from public, and no amount
of principal or interest was outstanding on the date of the Balance
Sheet.
DIRECTORS
Mr. Rajiv Rai Sachdev is a Non-Executive Non-Independent Director,
retires at the ensuing Annual General Meeting of the Company, being
eligible offer himself for re-appointment. A Brief resume of Mr. Rajiv
Rai Sachdev is forming part of the Corporate Governance Report.
Mr. Ajay Anand is the one of Promoters of the Company. The Board of
directors appointed him as Additional Director on the Board of the
Company w.e.f. 1st October 2013 and appointed as Managing Director
w.e.f. 1st April 2014.
The Board of Directors had re-appointed Mr. Sanjay Anand as Whole Time
Director of the Company and the same was approved by the members of the
Company at their meeting held on 29th September 2013. The Company had
an application to the Central Government for payment of remuneration
and the same was not been considered for approval and his
re-appointment was not regularized. Hence, the Board of Directors has
appointed Mr. Sanjay Anand as Whole time Director of the Company w.e.f.
1st April 2014 under the provisions of Section 196, 198, 203 and read
with Schedule V of the Companies Act, 2013.
Mrs. Rashmi Anand , Whole Time Director of the Company resigned from
the Board w.e.f. 17th June 2013. The Board wishes to place on record
its appreciation for the contribution made by Mrs. Rashni Anand in the
growth of the Company and wishes her the best for her future endeavors.
As per the provision of Section 149 and other applicable provisions, if
any, of the Companies Act, 2013, Mr. Vasudeva Rao, is proposed to be
appointed as Independent Directors of the Company for a period of five
years effecting from 1st April 2014 to 31st March 2019.
Your approval for their appointment of aforesaid Directors have been
sought in the Notice convening the Annual General Meeting of the
Company.
AUDITORS
M/s Thakur Vaidyanath Aiyar & Co. Chartered Accountants, Firm
Registration No. 000038N, retire at the forthcoming Annual General
Meeting and are eligible for reappointment. The retiring Auditors have
furnished a Certificate of their eligibility for re-appointment under
section 139 (1) of the Companies Act, 2013 (corresponding to section
224 (1B) of Companies Act 1956) and have indicated their willingness to
continue. Members are requested to appoint the auditors and fix their
remuneration.
AUDITORS' REPORT:
The Auditors' Report to the Shareholders does not contain any
reservation, qualification or adverse remark.
COST AUDITORS AND COST AUDIT REPORT:
Pursuant to the directives of the Central Government under the
provisions of Section 148 of Companies Act 2013 (corresponding to
section 233B of the Companies Act, 1956), qualified Cost Auditors have
been appointed to conduct cost audits relating to several products
manufactured by the Company.
REFERENCE TO BOARD FOR INDUSTRIAL AND FINANCIAL RECONSTRUCTION (BIFR)
The Company has filed a Reference under the provisions of Section 15A
of the Sick Industrial (Special Provisions) Act, 1985 with Board for
Industrial and Financial Reconstruction (BIFR) based on the Audited
Financial Accounts of the Company for year ended 31.03.2012. BIFR has
accepted the application and issued a Reference No. 48/2012. The said
reference is pending before BIFR.
FOREIGN CURRENCY CONVERTIBLE BONDS
The Company had issued Foreign Currency Convertible Bonds of US$ 8.00
million on 26.12.2006, which were due for redemption on 27.12.2011. The
company could not redeem the said bonds on due date. The Company has
made relevant provisions regarding principal, interest and revaluation
of liability in the Statement of Profit & Loss.
LEGAL SUITS
As reported last year, four winding petitions were filed against the
Company in the Bombay High Court. The proceedings of all four petitions
are pending before the Hon'ble High Court and the Company is strongly
contending the cases in the High Court.
PARTICULARS OF EMPLOYEE
There are no employees drawing salary as required to be mentioned under
Section 217 (2A) of the Companies Act, 1956 read with Companies
(Particulars of Employees) Rules, 1975.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars required under Section 217 of the Companies Act, 1956
read with the Companies (Disclosure of Particulars in the Report of
Board of Directors) Rules, 1988 is given in Annexure to this Report.
DIRECTOR'S RESPONSIBILITY STATEMENT
The Directors confirm that:
(i) In the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
(ii) The directors had selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent 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 or loss
of the Company for that period;
(iii) The directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provision of this Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities;
(iv) The directors had prepared the annual accounts on "going concern
basis".
CORPORATE GOVERNANCE
A separate section on Corporate Governance is included in the Annual
Report and the Certificate from the Company's auditors confirming the
compliance of conditions on Corporate Governance as stipulated in
Clause 49 of the Listing Agreement with the Stock Exchanges is annexed
thereto.
ACKNOWLEDGMENT
The Board places on record its deep appreciation of the devoted
services of the loyal workers, executives and other staff of the
Company, who have contributed to the performance and the Company's
continued inherent strength. It also extends its gratitude to the
Central and various State Governments, the investors, the bankers,
financial institutions and district level authorities for the support
extended to the Company from time to time. Shareholders' appreciation
of the management's efforts expressed at the general meetings of the
Company and otherwise, is a great fillip in the untiring effort for
better performance year after year.
For and on behalf of the Board
Place: Mumbai
Date: 29.05.2014 Ajay Anand
Chairman & Managing Director
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