Stanrose Mafatlal Investment & Finance Ltd

In order to infuse greater transparency and uniformity in practice, Reserve Bank of India vide its Circular RBI/2021-22/59 DOR.ACC.REC.No. 23/21.02.067/2021-22 dated June 24, 2021 has issued guidelines to all Non-Banking Financial Companies (NBFCs) for declaration of dividends. These guidelines are effective for declaration of dividend from the profits of the financial year ended March 31, 2022 and onwards. Accordingly, as the Company has incurred losses and in order to strengthen its resource base, your directors have decided not to recommend any Dividend for the year ended 31st March, 2025, but to conserve the funds for future contingencies.

The total income for the year was Rs.135.93 Lacs as compared to Rs.140.14 Lacs in the previous year. Depreciation was Rs.44.17 Lacs (Previous Year Rs.48.32 Lacs). The Provision for Taxation for the year under report was NIL. Loss after tax was Rs.(225.19) Lacs.

This year, the company has decided not to transfer any funds to General Reserve and Statutory Reserve Fund pursuant to Section 45IC of RBI Act,1934.

The Net Worth of the Company as at 31st March, 2025 stood at Rs.4,099.30 Lacs as against Rs.4,746.39 Lacs on 31st March, 2024.

The NBFC sector has a significant role in bringing efficiency and diversity in the financial system. It has evolved extensively in terms of its operations, technology, profitability and asset quality and entered into newer areas of financial services and products. NBFCs are now deeply interconnected with the entities in the financial sector, on both sides of their balance sheets.

Being financial entities,they are exposed to risks arising out of counterparty failures, funding and asset concentration, interest rate movement and risks pertaining to liquidity and solvency, as any other financial sector player.

The Company's operations continue to be mainly focused in the areas of Inter-corporate Investments, Capital Market activities and Financing.Segment-wise brief outline of financial and operational performance during the year under report is as under:

The Company's investment portfolio is reviewed from time to time to buy securities to add to its Portfolio or to sell in order to make Capital gains. Details of Company's investments are given under Note No. 8 to Financial Statements of the Company for the year ended 31st March, 2025. The total worth of Company's Quoted and Unquoted Investments in Shares and Securities (Including Stock-in-trade) as at 31st March, 2025 is Rs. 2742.89 Lacs (Previous Year Rs. 3277.71 Lacs). The Company has adopted IND-AS from 1st April, 2019. Under IND-AS, investments are valued at fair value whereas in case of IGAAP, Long term investments were valued at lower of cost or fair value.

During the year under report, the Company: a) has made disinvestment of Rs. 46.34 Lacs from its Non-current Quoted and Non-Quoted Equity Investments as against Rs. 50.57 Lacs in the Previous Year.

(b) booked a net profit of Rs.114.40 Lacs on sale of Non-Current investments as against Rs.42.02 Lacs in the previous year.

(c) earned income by way of Dividend of Rs.

134.39 Lacs against Rs. 135.67 Lacs in the previous year.

During the year under report the Company has not earned any interest income on Inter Corporate Deposits.

Note: The Company is not having any Debt/Borrowings as at 31st March, 2025. Also, the Company is not into Customer based products which are manufactured/produced by the Company. Hence, as required under Part B of Schedule V to SEBI

(Listing Obligations and Disclosure Requirements) Regulations, 2015, Debtors Turnover Ratio, Inventory Turnover Ratio and Interest Coverage Ratio have not been provided.

As various factors are posing constant threats and high volatility in the Capital Markets, it appears beneficial to diversify the portfolio to reduce the risk and insulate from the vagaries of stock-market. Mutual Funds help to reduce risk through diversification and professional management. Therefore, the Company invests its surplus funds in debt/ equity oriented Mutual Funds. One of the biggest advantages of Mutual Fund investment is Liquidity. Open-end funds provide option to redeem on demand, which is beneficial during rising or falling markets. The management is exploring other avenues of business.

The Company intends to continue focusing on capital market activities including trading in securities and emerging products in derivatives.

The Company is exposed to specific risks that are particular to its business and the environment within which it operates, including interest rate volatility, economic cycle, credit and market risks. The Company has quoted investments which are exposed to fluctuations in stock prices. These investments represent a material portion of the Company's business and are vulnerable to fluctuations in the stock markets. Any decline in prices of the Company's quoted investments may affect its financial position and the results of its operations. It continuously monitors its market exposure and tries to manage these risks by following prudent business and risk management practices.

The Company has a proper and adequate system of internal control in all spheres of its activities to ensure that all its assets are safeguarded and protected against loss from unauthorized use or disposition and that the transactions are authorized, recorded and reported diligently. The Internal control is supplemented by an effective internal audit being carried out by an external firm of Chartered Accountants.

The Company ensures adherence to all internal control policies and procedures as well as compliances with all regulatory guidelines.

The Audit Committee of the Board of Directors reviews the adequacy of internal controls.

The Company has diverse workforce which leads to sustainable growth and improvement in productivity. The Company has maintained cordial relations with its employees at all levels during the year.

The Company has complied with applicable provisions of Corporate Governance as provided under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. A separate report on Corporate Governance compliance is included as a part of the Annual Report along with the Auditors' Certificate.

Your Company has not accepted any public deposits during the year under review.

Pursuant to the requirements of Section 134(5) of the Companies Act, 2013, with respect to Directors' Responsibility Statement, your Directors confirm that:

1. In the preparation of the annual accounts for the financial year ended 31st March, 2025, the applicable Indian accounting standards (IndAS) have been followed and that there are no material departures from the same;

2. Accounting policies selected were applied consistently. Reasonable and prudent judgments and estimates were made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2025 and of the profit for the year ended on that date;

3. 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;

4. The annual Accounts for the Financial Year ended 31st March, 2025 have been prepared on a going concern' basis.

5. Proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

6. Proper systems devised to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

The Company's wholly owned subsidiary, Stan Plaza Limited is a Non-Listed Company, having its Registered Office at Mumbai. As on March 31, 2025, according to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, it is termed as a Non-Material Subsidiary of the Company.

In compliance with the requirements of the provisions of Section 129(3) read with Rule 5 of Companies (Accounts) Rules, 2014, a Statement in Form AOC-1 containing the salient features of the financial statements in respect of Stan Plaza Limited, a wholly owned subsidiary of the Company has been included as a part of this Annual Report.

As reported, Stanrose Mafatlal Lubechem Limited being in liquidation and inoperative, its details are not disclosed in Form AOC-1.

The Company's Policy for Determining Material Subsidiaries' for identifying material subsidiaries and providing governance framework is available on its website, www.stanrosefinvest.com.

The Consolidated Financial Statements (CFS) of the Company and its wholly owned subsidiary Company viz. Stan Plaza Limited (SPL) are prepared in accordance with the provisions of Schedule III of the Companies Act, 2013 and relevant Indian Accounting Standards issued by the Institute of Chartered Accountants of India, as applicable to the Company and form part of this Annual Report. These Statements have been prepared on the basis of audited financial statements received from SPL as approved by its Board. Stanrose Mafatlal Lubechem Ltd., a substantially owned subsidiary Company being inoperative, its financial statements are not considered in preparation of CFS.

In terms of Section 152 of the Companies Act, 2013, Shri Madhusudan J. Mehta, Director of the Company is retiring by rotation and being eligible, offers himself for reappointment.

Ms. Aziza A. Khatri has expressed her unwillingness to continue as an Independent Director for the second term due to her non-availability. Your Directors place on record their appreciation of the valuable services rendered by Ms.Khatri during her tenure as a director.

To fill in the vacancy of Independent Director caused by the resignation of Ms. Aziza Khatri in accordance with Section 149 of the Companies Act, 2013, the Board has appointed Ms. Abhirami M. Patel, as an Independent Director for five consecutive years w.e.f. 21st May, 2025. Accordingly, a resolution proposing her appointment alongwith her brief resume is provided in the Notice of the 45th AGM.

All Independent Directors have given their declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. None of the Directors of the Company is disqualified from being appointed or re-appointed as a Director as specified under Section 164 of the Companies Act, 2013.

The Company has appointed three Key Managerial Personnel, viz. Shri Madhusudan J. Mehta, Chief Executive Officer, Shri Harshad V. Mehta, Chief Financial Officer and Shri Soham A. Dave, Company Secretary & Compliance Officer, to inter alia shoulder the responsibilities in their respective fields as envisaged under the provisions of the Companies Act, 2013 & SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

M/s Manubhai & Shah, Chartered Accountants, (Firm Regn. No. 106041W/W100136), Ahmedabad, were re-appointed as the Statutory Auditors of the Company for a term of five consecutive years to hold office from the conclusion of the 42nd AGM till the conclusion of 47th AGM on the recommendation of the Audit Committee. The Company has received a letter from them that their re-appointment is within the prescribed limits under Section 139 of the Companies Act, 2013 and that they are not disqualified under Section 141 of the Companies Act, 2013.

No frauds have been reported by the Statutory Auditors during the Financial Year 2024-2025 pursuant to the provisions of Section 143(12) of the Act.

The Reports given by M/s. Manubhai & Shah, Chartered Accountants on the Financial Statements of the Company for the Financial Year 2024-25 does not contain any qualification, reservation or adverse remark and forms part of the Annual Report.

The details relating to fees paid to the Statutory Auditors are given in Note No. 23 of the Financial Statements.

The Board of Directors has appointed M/s. Manoj Hurkat

& Associates, Practicing Company Secretaries, as Secretarial Auditors of the Company pursuant to the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 and amended Regulation 24A of Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 for a term of five consecutive years starting from the financial year 2025-2026, subject to approval of the Members at the AGM. The Company has received a letter from them to the effect that their appointment is within the prescribed limits under Section 204 of the Companies Act, 2013 and amended Regulation 24A of Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Report of Secretarial Audit in form MR-3 in accordance with Section 204 of the Companies Act, 2013 and Regulation 24A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 for the financial year ended March 31, 2025 is annexed herewith and marked as "Annexure A" to this Report.

There are no audit qualifications, reservations, or any adverse remark in the said Secretarial Audit Report, except penalty imposed by BSE Ltd. for non-compliance under Reg. 13(3) of the SEBI (LODR) Regulations, 2015 for the March, 2024 Quarter which was subsequently complied with.

In accordance with the provisions of Section 135 of the Companies Act, 2013 and rules made thereunder, the Company has constituted a Corporate Social Responsibility Committee of Directors. The role of the Committee is to review the CSR activities of the Company periodically and recommend the Board the amount of expenditure to be incurred on the CSR activities annually. For the Financial Year 2024-25, the Company is not falling under Section 135(1) of the Companies Act, 2013 as the Net worth, Turnover and Net Profits of the Company are less than the prescribed limit for the past three consecutive years and so the reporting under the Companies (Corporate Social Responsibility Policy) Rules, 2014 is not applicable to the Company.

The Nomination and Remuneration Committee comprises of Ms. Aziza A. Khatri, Chairperson, Shri Harit S. Mehta and Shri Bharat N. Dave. The role and responsibilities, Company's policy on directors' appointment and remuneration including the criteria for determining the qualifications, positive attributes, independence of a director and other related matters are in conformity with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The policy is made available on the Company's website at www.stanrosefinvest.com.

The details of the remuneration received by the Directors from the Company have been disclosed in the Corporate Governance Report.

The information relating to the composition of the Committee, scope & term of reference, no. of meetings held and attendance, etc. during the year under report, are provided in the Corporate Governance Report.

In compliance with the provisions of the Act and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the performance evaluation was carried out as under: Board: As suggested by the Nomination and Remuneration Committee, the Board evaluated the performance of the Directors, on various criteria such as its composition, processes and dynamics. The Independent Directors, at their separate meeting, also evaluated the performance of the Board as a whole, based on various criteria. The Board and the Independent Directors were of the unanimous view that performance of the Board of Directors as a whole, was satisfactory.

Committees of the Board: The performance of the Audit Committee, Corporate Social Responsibility Committee, Nomination and Remuneration Committee and the Stakeholders' Relationship Committee was evaluated by the Board on various criteria such as committee composition, processes and dynamics. The Board was of the unanimous view that all the committees were performing their functions satisfactorily and according to the mandate prescribed by the Board under the regulatory requirements including the provisions of the Act, the Rules framed thereunder and the Listing Agreement/SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

(a) Independent Directors: In accordance with the criteria suggested by the Nomination and Remuneration Committee, the performance of each independent director was evaluated by the entire Board of Directors (excluding the director being evaluated) on various parameters like qualification, experience, availability and attendance, integrity, commitment, governance, independence, communication, preparedness, participation and value addition.

The Board was of the unanimous view that each independent director was a reputed professional and brought his/her rich experience to the deliberations of the Board. The Board also appreciated the contribution made by all the independent directors in guiding the management in achieving higher growth and concluded that continuance of each independent director on the Board will be in the interest of the Company.

(b) Non-Independent Directors: The performance of each of the non-independent directors (including the Chairperson) was evaluated by the Independent Directors at their separate meeting. Further, their performance was also evaluated by the Board of Directors. Some of the criteria considered for the purpose of evaluation included qualification, experience, availability and attendance, integrity, commitment, governance, communication, etc. The Independent Directors and the Board were of the unanimous view that each of the non-independent director was providing good business and leadership.

The particulars of ratio of remuneration of each director to median remuneration of the employees of the Company for the financial year under report, percentage increase in remuneration of each Director and KMP, etc. more particularly described under Section 197(12) of the Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are given in "Annexure B" to this Report.

The Company has a Code of Conduct for regulating, Monitoring and Reporting of Trading by Insiders ("PIT Policy") for connected persons, designated persons and the insiders (collectively the "Insiders") as defined under the SEBI (Prohibition of Insider Trading) Regulations, 2015 ("PIT Regulations"). The Policy provides adequate safeguard against victimization. The Audit Committee reviews the Institutional Mechanism for prevention of insider trading.

The aforementioned policy is available on the Company's website www.stanrosefinvest.com.

The Company being a Non-Banking Financial Company registered with Reserve Bank of India with the principal business inter alia, of Inter-Corporate Financing, the provisions of Section 186 except sub-section (1) are not applicable to it. Hence no particulars as envisaged under Section 134(3)(g) are covered in this Report.

The particulars of contracts or arrangements entered by the Company with related parties which are subsisting during the year under Report are provided under "Annexure C" in Form AOC - 2. The Company has framed a 'Policy on Related Party Transactions' for determining related parties, transactions on arm's length basis and procedures to be followed for obtaining various approvals, etc. The policy is available on the website of the company, www.stanrosefinvest.com. As regards the justification for related party transactions, it may be noted that the same are entered on business exigencies and are in the best interest of the Company.

Pursuant to the requirement of Section 134(3) of the Companies Act, 2013, read with Rule 8 of Companies (Accounts) Rules, 2014: (a) The Company has no activity involving conservation of energy or technology absorption.

(b) The Company does not have any Foreign Exchange Earnings.

(c) Outgo under Foreign Exchange - NIL

The Brief details of Company's "Vigil Mechanism/Whistle Blower Policy" are provided in the Corporate Governance Report.

As per the requirement of the provisions of the sexual harassment of women at workplace (Prevention, Prohibition & Redressal) Act, 2013 read with rules made thereunder, our Company has constituted Internal Complaints Committees in requirement of the Act, responsible for redressal of complaints relating to sexual harassment against women at workplace. During the year under review, there were no complaints pertaining to sexual harassment against women.

As reported earlier the Company has formulated and adopted Risk Management Policy to identify, evaluate, monitor and minimize the identifiable business risks in the Organization.

Pursuant to Section 134(3) of the Act, the annual return of the company has been placed on its website, www.stanrosefinvest.com.

The Company has not employed any individual whose remuneration falls within the purview of the limits prescribed under the provisions of Section 197 of the Companies Act, 2013, read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Your Directors sincerely express their deep appreciation to employees at all levels, bankers, customers and shareholders for their sustained support and co-operation and hope that the same will continue in future.