CREDIBILITY – SBI Capital Market Limited, more popularly called 'SBICAPS' is India's leading Investment Bank. As a wholly owned subsidiary of State Bank of India, it bears formidable credibility among industries in every conceivable vertical.
ACUMEN – As an end-to-end solutions provider in the Investment Banking and Corporate Banking space for more than a quarter of a century, SBICAPS has nurtured an enviable customer profile and established a global presence, based on its professional acumen.
PERFORMANCE – Today SBICAPS is also a global leader in Project Loan Syndication and a critical player in the Indian Infrastructure space. This exceptional performance makes it a potentially powerful growth ally of India and countries across the world.
SUSTAINABILITY – At SBICAPS, sustainability is not simply a catchphrase, but a watchword. We not only enter into and nurture sustainable relationships with clients, but by advising in wind, solar, nuclear and other renewable energy projects, we help power India into a better future – sustainable for life and livelihoods.
Vision
To be the best India based
investment bank.
MissionTo provide credible, professional and customer focused world class investment banking services.
IN
DE
X
Board of Directors
Awards & Rankings
About Us
Financial Highlights & Market Standing
04
06
08
09-10
The Infrastructure Group
The Non-Infrastructure Group
The Capital Markets Group
12
14
16
Directors' Report
Auditor's Report
CAG Comments
Balance Sheet
Profit & Loss Account
Cash Flow Statement
Schedules
18
31
34
35
36
37
39
SBICAP SECURITIES LIMITED
SBICAP TRUSTEE COMPANY LIMITED
SBICAPS VENTURES LIMITED
SBICAP (UK) LIMITED
SBICAP (SINGAPORE) LIMITED
64
93
116
132
144
ANNUAL REPORT004 12-13
Shri Pratip ChaudhuriChairman
Shri S. VishvanathanDirector
(previously MD & CEO up to 17th August, 2012)
Board
of
Directors
ANNUAL REPORT 00512-13
Shri Shyamal AcharyaDirectorSmt. Arundhati Bhattacharya
MD & CEO (with effect from 21st August, 2012)
Smt. Aruna JayanthiDirector
Smt. Bharati Rao Director
Shri Ashok KiniDirector
Shri D. SundaramDirector
Shri Bansi S. MehtaDirector
Shri Narayan K. SeshadriDirector
Shri Pradeep Kumar SarkarDirector
* Directors listed in alphabetical order
ANNUAL REPORT006 12-13
Awards & Rankings
No. 1 Global Project
Finance Book Runner
No. 1 Asia Pacific
(including Australia & Japan)
Project Finance Mandated
Lead Arranger
No. 1 Asia Pacific
(including Australia & Japan)
Project Finance Book Runner
No. 2 Global Project
Finance Mandated Lead Arranger
No. 1 Global Mandated Lead
Arranger in Project Finance Loans*
No. 1 Global PFI/PPP Mandated Lead
Arranger in Project Finance Loans*
No. 1 Global Financial
Advisor in Project Finance Deals*
No. 1 Global PFI/PPP
Financial Advisor in Project Finance Deals
No. 2 in Middle East & African Project Finance Loans
THOMSON REUTERS
DEALOGIC
* For the 4th consecutive year
ANNUAL REPORT 00712-13
'India Loan House of the Year,' 2012
'African Oil & Gas Deal of the Year,' 2012
for Bharat Petro Resources (BPCL) –
Mozambique
'Deal of the Year' in 2012
for Videocon
No.1 Mandated Lead
Arranger in Asia Ex-Japan Loans
No.1 India Loans
Mandated Lead Arranger
Ranked No. 1 in the number of issues
handled for the public issue of debt
in FY 2013
Ranked No. 1 in the Public Sector OFS issues FY 2013
Ranked No. 2 in the number of IPOs (excluding SME IPOs) handled in FY 2013
Mandated Lead Arranger for all Tax-free Public Bond Issuances in FY 2012 & FY 2013 aggregating a total
in excess of INR 70,000 crores
Sole arrangers to the largest Rupee NCD
for Rs. 7,400 crore
Ranked No. 2 in the number of
Rights Issues handled in FY 2013
PFI-THOMSON REUTERS BUSINESSWORLD
PRIME DATABASE
IFR ASIA
BLOOMBERG
* For the 4th consecutive year
ANNUAL REPORT008 12-13
About Us
SBI Capital Markets Ltd. (SBICAP), India's largest domestic Investment Bank, began its operations in August 1986 and is a wholly owned subsidiary and investment banking arm of State Bank of India (SBI), the largest commercial bank in India.
SBICAP offers the entire bouquet of Investment Banking and corporate advisory services. The service bouquet includes the full range of financial advisory services under one umbrella covering Project Advisory and Loan Syndication, Structured Debt Placement, Capital Markets, Mergers & Acquisitions, Private Equity and Stressed Assets Resolution.
As a complete solutions provider to clients in investment banking and corporate advisory, SBICAP offers them advice, innovative ideas, and unparalleled
execution across all stages in their business cycle ranging from venture capital advisory, project advisory, buy and sell-side advisory, accessing financial markets to raise capital and even restructuring advisory in their turn-around phases. SBICAP is a global leader in the area of Project Loan Syndication and has lent crucial support to the Indian infrastructure sector.
SBICAP is known for its astute professionalism and business ethics. The team of executives consists of qualified and dedicated professionals with vast experience in the fields of Project Advisory, M&A Advisory, Corporate Strategy or Business Restructuring Advisory, arranging of Private Equity/Structured Finance, Equity,
Debt and Hybrid Capital raising.
Headquartered in Mumbai, SBICAP has 6 regional offices across India (New Delhi, Kolkata, Hyderabad, Chennai, Bangalore and
Ahmedabad), 2 branch offices (Pune and Guwahati) and 5 subsidiaries - SBICAP Securities Limited, SBICAP Trustee Company Limited, SBICAP Ventures Limited, SBICAP (UK) Limited and SBICAP (Singapore) Limited. The regional offices are located strategically at major business hubs in
the country and closely liaise with clients at those and nearby centers.
SBICAP also offers services in the areas of Equity Broking & Research, Security Agency & Debenture Trusteeship and Private Equity Investment & Asset Management through its wholly-owned subsidiaries SBICAP Securities Limited, SBICAP Trustee Co. Ltd and SBICAP Ventures Limited, respectively.
504.91
545.74
649.86
766.82
878.10
26.00
26.63
64.57
43.25
51.00
150.9
137.12
374.72
250.98
296.00
0 100 200 300 400 500 600 700 800 900
0 10 20 30 40 50 60 70 80 90
0 50 100 150 200 250 300 350 400 450
FY 09
FY 10
FY 11
FY 12
FY 13
FY 09
FY 10
FY 11
FY 12
FY 13
FY 09
FY 10
FY 11
FY 12
FY 13
NETWORTH
(` in crores)
EARNINGPER SHARE
PROFITAFTER TAX
(` in crores)
GROSSINCOME
(` in crores)
0 100 200 300 400 500 600 700 800 900
FY 09
FY 10
FY 11
FY 12
FY 13
275.5
283.65
656.55
490.81
549.77
ANNUAL REPORT 00912-13
financial highlights
ANNUAL REPORT010 12-13
market standing
Source : Bloomberg - India League Table 2011 Source: Bloomberg - India League Table 2012
ICICI IDBI Bank Ltd
Standard Chartered PLC
INDIA LOANS MANDATED ARRANGER (CY 11) (Volume in USD mn; market share in%)
40000
35000
30000
25000
20000
15000
10000
5000
0Axis Bank
34771 9250 631445%
40%
35%
30%
25%
20%
15%
10%
5%
0%
6072 3582
41.90%
11.10%
7.60%7.30%
4.30%
ICICIIDBI Bank Ltd
Standard Chartered PLC
INDIA LOANS BOOK RUNNER (CY 11)
(Volume in USD mn; market share in%)
30000
25000
20000
15000
10000
5000
0Axis Bank
25188 7429 695845%
40%
35%
30%
25%
20%
15%
10%
5%
0%
5111 1916
39.40%
11.60%
10.90%8.00%
3.00%
ICICIIDBI Bank Ltd
Yes Bank
INDIA LOANS MANDATED ARRANGER (CY 12) (Volume in USD mn; market share in%)
30000
25000
20000
15000
10000
5000
0Axis Bank
30093 5077 427560%
50%
40%
20%
10%
0%
4118 1017
52.60%
8.90%7.50% 7.20%
1.80%
35000
30%
ICICIIDBI Bank Ltd
JP Morgan
INDIA LOANS BOOK RUNNER (CY 12)(Volume in USD mn; market share in%)
4000
2000
0Axis Bank
18935 4835 431960%
50%
40%
20%
10%
0%
3390 830
48.60%
12.40%
11.10%
8.70%
2.10%
30%
6000
8000
10000
12000
14000
16000
18000
20000
Includes all eligible syndicated loan transactions in India in any currencies (both INR and foreign currencies)
*
State Bankof India*
Includes all eligible syndicated loan transactions in India in any currencies (both INR and foreign currencies)
*
State Bankof India*
Includes all eligible syndicated loan transactions in India in any currencies (both INR and foreign currencies)
*
Includes all eligible syndicated loan transactions in India in any currencies (both INR and foreign currencies)
*
State Bankof India*
State Bankof India*
**State Bank of India denotes SBICAP
ANNUAL REPORT 01112-13
SBICAP(Rank 12)
1553966.25 1456987.55 1376640.62
SBICAP AxisCapital (ENAM)
AK Capital
PUBLIC ISSUE OF DEBT
1556292.21
I-SEC
5000000
4500000
4000000
3500000
3000000
2500000
2000000
1500000
1000000
5000000
0
1554324.26
Kotak Mahindra Capital
2238909.56 1422589.73 1230769.56
I-SEC Kotak MahindraCapital
PRINV
PUBLIC ISSUE OF DEBT(` in lakhs) FY 12 (` in lakhs) FY 13
2802238.2
SBICAP
5000000
4500000
4000000
3500000
3000000
2500000
2000000
1500000
1000000
5000000
0
2645676.47
AKCapital
8147304 8118340 6673587
Axis Ltd.
Bank I-SECPD
DARASHAW
PRIVATE PLACEMENT OF DEBT
10456867
ICICI Bank
2000000
1800000
1600000
1400000
1200000
1000000
8000000
6000000
4000000
2000000
0
10363600
5445557
TRUSTINV
10811440 8857012 8073562
Axis Ltd.
Bank I-SECPD
AKCapital
PRIVATE PLACEMENT OF DEBT
13996708
2000000
1800000
1600000
1400000
1200000
1000000
8000000
6000000
4000000
2000000
0
11827088
5683628
TRUSTINV
(` in lakhs) FY 13(` in lakhs) FY 12
ICICI SBICAP(Rank 14)
1575605.14 1418105.14 165428.96
CITIGroup
MorgonStanley
SBICAP(Rank 14)
ALL EQUITIES ( in lakhs) FY 12`
2021517.36
JMFICS
5000000
4500000
4000000
3500000
3000000
2500000
2000000
1500000
1000000
5000000
0
1734497.43
BAML(DSPML)
2074860.73 1816390.78 1749038.62
AxisCAP(ENAM)
Deutsche SBICAP(Rank 7)
ALL EQUITIES
2675630.36
Citi Group
2459681.79
KotakMahindra
( in lakhs) FY 13`
5000000
4500000
4000000
3500000
3000000
2500000
2000000
1500000
1000000
5000000
0
Source: Prime Database Source: Prime Database
Source: Prime Database Source: Prime Database
Source: Prime Database Source: Prime Database
ANNUAL REPORT012 12-13
the infrastructure group
SBICAPS is the market leader in providing financial advisory services to a large and varied client base
in various sectors with focus on the infrastructure sector. Our Infrastructure Group (erstwhile Project
Advisory & Structured Finance – PA&SF) provides the best-in-class services and excellence in
execution of the most complex transactions across the service space in order to help our clients grow
and achieve their strategic business objectives.
ANNUAL REPORT 01312-13
The Infrastructure Group has been a pioneer in infrastructure advisory in the country with a
comprehensive range of offerings covering the entire life cycle of the projects. Its wide
knowledge base makes it the foremost choice of the corporates involved in the infrastructure
sector as well as the government bodies for availing advisory services. On the other hand, its
strong relationship with banks and financial institutions – both domestic and overseas, make
SBICAPS the market leader and first port of call for debt syndication services for project finance.
The Group also provides services like M&A advisory, arranging private equity, restructuring
advisory, pre-bid advisory and bid process management services, etc. in this space. With
continued focus on infrastructure development and spending, our Infrastructure Group is well
placed to continue its eminence in this sector and to act as a key ally for both the Government
and the Private sector in their endeavors towards infrastructure development. We also work
closely with Governments, Regulators, other industry bodies on policies and regulations.
This group has a team of around 300 professionals from diversified backgrounds with relevant
experience and expertise in respective infrastructure sub-sectors like Power, Transportation,
Urban Infrastructure, Hydrocarbon, Telecom, Aviation, Mining, etc.
ANNUAL REPORT014 12-13
thenon-infrastructure group
ANNUAL REPORT 01512-13
The Infrastructure & Non-Infrastructure Groups Offerings Include:DEBT, M&A AND PRIVATE EQUITY ADVISORY
FINANCIAL APPRAISAL, BID ADVISORY
STRUCTURED FINANCE: ACQUISITION, LEVERAGE, MEZZANINE FINANCING AND CONVERTIBLES WITH CUSTOMIZED SOLUTIONS
CORPORATE RESTRUCTURING OF COMPANIES
l
l Raise funds from ECA's and multilateral agencies
l Identify assets for acquisition and strategic investments
l Mobilise private/ quasi equity
l Advice on demerger and sale of assets
l Advice on divestment of companies
l Provide acquisition advisory services for both domestic and outbound acquisitions
l Valuation Advisory Services
l Financial appraisal of projects
l Due diligence and capital structuring
l Strategy and bid advisory to State/ Central Governments and regulatory bodies
l Business valuation and joint venture advisory
l Arranging bridge and interim finance for acquisitions
l Structured trade finance for raising funds for overseas companies
l Advising clients for participation in international project syndications
l Structured finance products for off-balance sheet and receivable financing
l Re-organization and re-capitalization advisory
l Financial viability and business plan advisory
l Debt restructuring both within and outside the CDR mechanism
Arrange onshore and offshore debt and working capital
the Capital Markets group
Our Capital Markets Group (CMG) specializes in assisting
clients in raising long term funds through bonds and
equity. As leading merchant banker of choice, we have
been involved in most major book building and fixed price
offerings over the last decade. CMG assists clients
(Corporates, Banks, Financial Institutions, PSUs, State
Government Undertakings, etc.) in fund-raising by way of
equity and debt from both Domestic and Foreign
Investors.
Apart from providing expert advice in matters related to
IPOs, FPOs, Rights and a host of other related activities,
our USP lies in developing customised solutions for clients
to meet specific transaction requirements.
Our investor relationships spanning across corporates,
banks, domestic and foreign financial institutions, high
net-worth individuals and retail individuals have been
long-standing giving us an edge in our product offerings in
the equity and debt capital markets space.
ANNUAL REPORT016 12-13
ANNUAL REPORT 01712-13
EQUITY PRODUCTS AND SOLUTIONS OFFERED BY THE CAPITAL MARKETS GROUP INCLUDE:
DEBT PRODUCTS AND SOLUTIONS OFFERED BY THE CAPITAL MARKETS GROUP INCLUDE:
l Managing Initial and Follow on Public Offerings (IPOs and FPOs)
l Managing Rights Offering
l Qualified Institutional Placements (QIPs)
l Open offers, buy back and delisting of securities
l Offer for Sale (OFS) on the stock exchange
l Institutional Placement Program (IPP)
l Private Equity
l Bulk and block trades on exchanges, and off-market transactions
l Offerings of convertible securities
l Arranging private equity including growth capital, pre-IPO convertibles, Private Investments in Public Equity (PIPE), mezzanine debt and equity, and equity offerings completed as a private placement
l Capital restructuring advisory
l Advisory and arrangement services for products such as AIM listing, Indian Depository Receipts, ADR/GDR and other off-shore equity listing options
l Valuation advisory
l Private placement of Non-Convertible Debentures (NCDs)/ CPs/ Bonds (including tax free bonds)
l Public Issue of Bonds – including Taxable and Tax Free bonds
l Foreign Currency Denominated Bonds/ MTNs
l Structured Debt and Fund Raising Advisory
DIRECTORS' REPORT FOR THE YEAR 2012-13
ANNUAL REPORT018 12-13
To the Members,
thYour Directors are pleased to present the 27 Annual Report of the Company together with the Profit and Loss Account for the year ended 31st March, 2013 and the Balance Sheet as on that date.
Performance Highlights (Rs. in Crs.)
Year ended March 31 2013 2012
a) Fee based – Merchant Banking and advisory fees 491.24 437.66
b) Income from securities, Lease and hire purchase and other Income 58.53 53.15
549.77 490.81
Profit before provisions, Depreciation, Interest and Tax 428.51 370.83
Provisions 7.31 3.57
Depreciation 2.80 2.40
Interest 0.01 -
Profit before tax 418.39 364.86
Profit after tax 296.00 250.98
Equity Share Capital 58.03 58.03
Reserves and Surplus 833.79 713.16
Earnings per share (Rs.) 51.00 43.25
Return on Equity 33% 33%
Dividend per share (Rs.) 26.00 20.00
Book Value per share (Rs.) 151.44 132.13
Operating Results
Gross Income :
Total
Financial Position
Other Selected Data
Some major Performance Highlights are :
DIVIDEND & TRANSFER TO GENERAL RESERVE
AWARDS & RECOGNITION
nSyndicated loans of over Rs.1,85,000 Crs.
nInternational ECB Syndication deals volume - $ 7 billion.nHandled Debt issues aggregating Rs.75,253 Crs.
Out of the current year's profits, the Directors propose that a sum of Rs. 29.60 Crs. be transferred to the General Reserve. thDuring the year, the Board declared an Interim Dividend of Rs.26 per share on 26 March, 2013. The Directors propose
that the Interim Dividend of Rs.26 per share be declared as the Final Dividend.
Your Company continued to receive both domestic and international awards during the calendar year 2012, the most
prominent being:
nIFR Asia 'India Loan House of the Year' for the 4th consecutive year
nThomson Reuters- PFI 'African Oil & Gas Deal of the Year' for Bharat Petro Resources (BPCL) – Mozambique ?
nBusiness World Awards 'Deal of the Year' in 2012 for Videocon
Your Company received top rankings from many rating agencies. Significant among them are:
nBloomberg League Tables
nNo. 1 Mandated Lead Arranger in Asia Ex-Japan Loans League Tables 2012 for the 6th consecutive year with market
share of 10.9%
nNo. 1 India Loans Mandated Lead Arranger with market share of 52.6%
nThomson Reuters-PFI
nNo. 1 Global Project Finance Bookrunner for the 4th consecutive year
nNo. 1 Asia Pacific (including Australia & Japan) Project Finance Mandated Lead Arranger
nNo. 1 Asia Pacific (including Australia & Japan) Project Finance Bookrunner
nNo. 2 Global Project Finance Mandated Lead Arranger
DIRECTORS' REPORT (contd.)
ANNUAL REPORT 01912-13
(Rs. in Crs.)
Particulars 2012-13 2011-12
Total Income 69.60 87.24
Expenses 65.66 81.09
Profit Before Tax 3.69 5.94
Profit After Tax 2.43 4.03
n
thNo.1 Global Mandated Lead Arranger in Project Finance Loans for the 4 consecutive year with market share
of 6.4% th
nNo. 1 Global PFI/PPP Mandated Lead Arranger in Project Finance Loans for the 4 consecutive year with market
share of 6.6% th
nNo. 1 Global Financial Advisor in Project Finance Deals for the 4 consecutive year with market share of 9.4% rd
nNo. 1 Global PFI / PPP Financial Advisor in Project Finance Deals for the 3 consecutive year with market
share of 11.5 %
nNo. 2 in Middle East & African Project Finance Loans with a 7.5% market share
nPrime Database
nRanked No. 1 in the number of issues handled for the public issue of debt in FY 2013
nRanked No. 1 in the Public Sector OFS issues FY2013
nRanked No. 1 in the Public Issue of Debentures in FY 2012
nMandated Lead Arranger for all Tax-free Public Bond Issuances in FY 2012 & FY 2013 aggregating a total in excess of
INR 70,000 crores
nSole arrangers to the largest privately placed non-convertible structured bond deal in the country for
Rs. 7,400 crore
nRanked No. 2 in the number of Rights Issues handled in FY 2013
nRanked No. 2 in the number of IPOs (excluding SME IPOs) handled in FY 2013
Management Discussion and Analysis is annexed to and forms part of this report (Annexure 'A').
The Directors' Report on Corporate Governance for the year 2012-13 is attached (Annexure 'B').
The performance of the five subsidiaries during the year 2012-13 is as follows :-
A brief summary of the financial highlights in the FY 2012-13 is given hereunder :
Dealogic
n
MANAGEMENT DISCUSSION AND ANALYSIS
CORPORATE GOVERNANCE
SUBSIDIARIES
1. SBICAP Securities Limited (SSL)
n
cater to institutional investors. SSL's research now covers all key sectors and most NIFTY stocks. n? A new Debt Market vertical has also been set up during the year which broke even in a very short time span. nNew products and enhanced client servicing through advisory and call centre interaction have helped SSL deepen
client relationships and despite a very difficult year with a decline of about 24% in the overall retail volumes, SSL was able to hold its retail top line.
nSales and Distribution income which in the previous year contributed to about 46% of the gross revenues of SSL, wasimpacted by the muted investor interest in the Tax Free Bonds, leading to a reduced top line for SSL.
nSSL has made significant investments in team building, technology and branch expansion this year which has lowered PAT but enhanced wherewithal for future growth.
A brief summary of the financial highlights in the FY 2012-13 is given hereunder :
The company achieved Income of GBP 1,903,461 vis-a-vis the previous year level of GBP 1,184,676 and PAT of GBP
1,164,337 as against PAT of GBP 635,328 during the previous year.
On the Institutional business side, SSL has ramped up its sales and research teams and set up an exclusive FII desk to
2. SBICAP (UK) Limited (SUL)
(Rs. in Crs.)
Particulars 2012-13 2011-12
Fee Income 16.89 9.18
Other Income 0.37 0.11
Gross Income 17.26 9.29
Expenses 3.48 2.64
Profit Before Tax 13.78 6.65
Profit After Tax 10.76 4.82
SB
I C
APIT
AL
MA
RK
ETS L
IMIT
ED
ANNUAL REPORT020 12-13
DIRECTORS' REPORT (contd.)
(Rs. in Crs.)
Particulars 2012-13 2011-12
Fee based – Trustee Remuneration Fees 13.61 10.78
Other Income 1.35 0.85
Total Income 14.96 11.63
Expenses 3.81 2.98
Profit Before Tax 11.15 8.65
Profit After Tax 7.52 5.83
3. SBICAP Trustee Company Limited (STCL)
A brief summary of the financial highlights in the FY 2012-13 is given hereunder :
During the year the Company registered encouraging growth in gross Income of approx. 29% and also registered growth
in profit after tax of approx. 29% as compared to the previous year. The Company issued Bonus shares in the ratio of 1:1 to
the shareholders by capitalizing free reserves of Rs.0.50 Cr. Thus, equity share capital of the Company increased from
Rs.0.50 Cr. to Rs.1.00 Cr.
Presently, the Company is undertaking various Corporate Trusteeship activities viz. Security Trusteeship, Security Agent
and Safe Custody of Documents, Debenture/Bond Trusteeship, Escrow Agent, Escrow Trusteeship, Share Pledge
Trusteeship, etc.
During the current year STCL shifted its Delhi office to new separate premises. The company's operations are now well
stabilized and the company is expected to further consolidate its position in the market during the year 2013–14.
In order to bring uniformity in the names of all the subsidiaries, the name of the company was changed from SBICAPS
Ventures Limited to SBICAP Ventures Limited (SVL), during the year.
During the year, SVL made a net profit after tax (PAT) of Rs.0.35 Cr.
thApproval of Monetary Authority of Singapore (MAS) to start the operations was received by SSGL on 30 November st2012. Till date, SBICAP has infused SGD 2 mn. as share capital in SSGL. Total expense of SSGL for the year ended 31
March, 2013 worked out to SGD 691,198.
During the year under review, the following changes took place among the Directors of the Company :-
thnDr. R.H. Patil, Director, passed away on 12 April, 2012.
thnShri S. Vishvanathan resigned as Managing Director & CEO with effect from 17 August, 2012.
stnSmt. Arundhati Bhattacharya was appointed as Managing Director & CEO with effect from 21 August, 2012. nShri Ashok Kini, Shri P.K. Sarkar and Smt. Aruna Jayanthi were appointed as Additional Independent Directors with
effect from 18th October, 2012.th
nShri Shyamal Acharya resigned as Director with effect from 29 November, 2012.rd
nShri S. Vishvanathan was appointed as Director with effect from 3 December, 2012.
The Board extended a hearty welcome to Shri Ashok Kini, Shri P.K. Sarkar, Smt. Aruna Jayanthi and Shri S. Vishvanathan, as
Directors and Smt. Arundhati Bhattacharya as Managing Director & CEO of the Company and placed on record its deep
appreciation to Dr. R. H. Patil and Shri Shyamal Acharya, for their valuable contributions during their tenure as Directors of
the Company.
thShri Narayan K. Seshadri, Director retires by rotation at the 27 Annual General Meeting of the Company and being
eligible, offers himself for re-appointment.
Shri Ashok Kini, Shri P.K. Sarkar and Smt. Aruna Jayanthi, Additional Independent Directors hold office upto the date of ththe ensuing 27 Annual General Meeting (AGM) of the Company and are eligible for re-appointment as Directors liable to
thretire by rotation at the said 27 AGM. The Company has received three notices under Section 257 of the Companies Act,
1956 from State Bank of India (the member), together with necessary Deposit, proposing their candidatures for thappointment as Directors liable to retire by rotation at the said 27 AGM.
4. SBICAP Ventures Limited (SVL)
5. SBICAP (Singapore) Limited (SSGL)
DIRECTORS
DIRECTORS' REPORT (contd.)
ANNUAL REPORT 02112-13
DIRECTORS' RESPONSIBILITY STATEMENT
COMPANIES (DISCLOSURES OF PARTICULARS IN THE REPORT OF THE BOARD OF DIRECTORS) RULES, 1988
Conservation of Energy and Technology Absorption
Foreign Exchange Earnings and Outgo
CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES
AUDITORS
COMMENTS OF THE COMPTROLLER & AUDITOR GENERAL OF INDIA
PARTICULARS OF EMPLOYEES
Pursuant to Section 217(2AA) of the Companies Act,1956, the Directors confirm that :-
(i) In the preparation of the annual accounts, the applicable accounting standards have been followed;
(ii) Appropriate accounting policies have been selected and applied consistently and the judgements and
estimates that have been made are reasonable and prudent so as to give a true and fair view of the state of st staffairs of the company as on 31 March, 2013 and of the profit or loss of the company for the year ended 31
March, 2013;
(iii) Proper and sufficient care has been taken for the maintenance of adequate accounting records in
accordance with the provisions of the Companies Act for safeguarding the assets of the company and for
preventing and detecting frauds and other irregularities;
(iv) The annual accounts have been prepared on a going concern basis.
In terms of the above Rules issued by the Central Government, the following information is furnished:-
Since the Company is engaged in Merchant Banking and Advisory Services, there is no information to report under this
head.
During the year under review, SBICAP earned foreign exchange equivalent to Rs.19.57 Crs. towards advisory fee from
overseas clients and reimbursement of expenses. The total foreign exchange expended amounted to Rs.3.62 Crs. on
account of foreign travel and other expenses.
Being conscious of its obligation to society at large, your company had undertaken the below mentioned activities during
the Financial Year 2012-13. The focus was to extend a helping hand to the under privileged and differently abled.
nA multi-purpose vehicle was donated to The Ramakrishna Math & Mission, Mumbai. The Mission has adopted a tribal
village at Sakvar in Thane District (about 60 kms from Mumbai) and provides medical care to all villagers through a
charitable dispensary. The vehicle donated will meet the transportation needs of volunteers, doctors and other
personnel travelling to and from the dispensary.
nWe also donated a multi-purpose van to the Santosh Institute for Mentally Challenged Children in Mumbai. This
Institute caters to the needs of autistic, mentally and physically challenged children. It focusses on sports and the
development of alternative skills to empower its students to lead an independent life.
M/s. Sudit K. Parekh & Co., Chartered Accountants, were appointed as the Statutory Auditors of the Company for the
financial year 2012-13, by the Comptroller & Auditor General of India (CAG), under the provisions of Section 619(2) of the
Companies Act 1956. They will hold office till the ensuing Annual General Meeting of the Company. The request for
appointment of Statutory Auditors for the financial year 2013-14 has been made to CAG.
thComments of the Comptroller & Auditor General of India report dated 11 June, 2013, submitted under Section 619(4) of
the Companies Act, 1956 on the accounts of the Company for the year ended 31st March, 2013 is enclosed. It is reported
therein that on the basis of their audit, nothing significant has come to their knowledge which would give rise to any
comment upon or supplement to Statutory Auditor's report under section 619(4) of the Companies Act, 1956.
The information as required under Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of
Employees) Amendment Rules, 2011, as amended, is given in Annexure 'C'.
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ANNUAL REPORT022 12-13
DIRECTORS' REPORT (contd.)
ACKNOWLEDGEMENT
The Board of Directors would like to express its thanks to SEBI - the Company's Regulator, and to the Comptroller &
Auditor General of India (CAG), for the advices and guidance received. The Board is also grateful to the State Bank of India
and its group companies for providing significant business support, which has been mutually rewarding.
The Board of Directors places on record its appreciation for the valued support from clients for the company, which has
been very crucial for its standing in the industry. The Board would also like to thank the investing community,
intermediaries in the investment-banking field and the statutory authorities for the co-operation extended from time to
time. The Board also places on record its deep appreciation for the dedication and commitment of its employees at all
levels and looks forward to their continued contribution in the journey ahead.
For and on behalf of the Board of Directors
Pratip Chaudhuri
Chairman
Place : MumbaistDate : 1 August, 2013
ANNEXURE a
ANNUAL REPORT 02312-13
Management Discussion and Analysis
1. Macroeconomic Review
2. Investment Banking Strategies
A growing number of developed economies, especially in Europe, faced recessionary conditions. Most central banks in
the developed economies expanded their asset purchase programme and kept their monetary policies in expansionary
mode by maintaining exceptionally low interest rates in FY 2012-13. In September 2012, the US Federal Reserve
expanded the size of its Quantitative Easing Program by adding USD 40 billion worth mortgage debt to its already
existing monthly purchases of USD 45 billion of long dated US treasuries. The European Central Bank too announced that
it would purchase unlimited amounts of government bonds of Spain and other euro states that face high borrowing
costs, provided these countries adhere to the requirements of a formal bailout. Among other central banks, Bank of
England and Bank of Japan too expanded their asset purchase programs and continued to keep their policy rates at
historically low levels.
The fundamentals of the Indian economy weakened significantly in FY13 on the back of global financial market volatility
and overall weak demand conditions in the global arena, with inflation levels remaining relatively sticky. The economy
slowed to a real GDP growth of 6.2% in FY12 and this slowdown phase continued into the fourth quarter of FY13, with
overall GDP growth settling at 4.8% in Q4 FY13, when compared with 5.4% in Q1 FY13 and 5.1% in Q4 FY12.
The moderation in growth can be primarily attributed to weakness in industry, which registered a growth of 3.1% in
2012-13, the lowest in the last eleven years. Growth in agriculture was also weak in the year, on the back of lower rainfall
during the south-west monsoon season. Overall services sector production slowed down, against subdued banking
activity particularly, lower credit-off take (bank credit grew by 14.1% in FY13 as against 17.0% in FY12) and a slash in
government expenditure.
A significant stress area that emerged in FY12 and aggravated in FY13 is the pressure on the Current Account Deficit
(CAD) that also led to certain policy changes to attract more capital flows into the economy to finance the CAD. The
CAD/GDP ratio reached a historic high of 6.7% in Q3 of FY13. The trade gap as a proportion of GDP worsened to 12.3% in
this quarter on account of weak external demand. While the worsening of the trade gap was on account of weak external
demand that affected merchandise exports adversely, the imports of oil and gold increased sharply due to the higher
price of oil and gold. The large depreciation of the rupee against the USD also failed to have much positive impact on the
export dynamics.
In FY13, RBI's monetary policy maintained focus on the growth-inflation dynamics via a combination of steps for liquidity
easing and policy rate cuts. The benchmark policy interest rate (Repo rate) was reduced by RBI by 50 bps in April 2012.
However, with inflation remaining on the higher side, the RBI had to pause for a significant period before providing the
market with any further cuts on the Repo rate. When Headline WPI inflation tapered off in Q4, RBI cut the repo rate by 25 th thbps on 29 January, 2013 and further by 25 bps on 9 February, 2013. Over the full FY, the RBI infused liquidity of
Rs.127,180 crores via its OMO operations. The CRR was reduced by 75 bps and the SLR requirement of banking sector was
also reduced by 100 bps in August 2012 to 23%.
During the year, the Company continued its thrust on synergy with State Bank of India and its Associate Banks.
The Capital Markets Group has expanded its bouquet of services with transactions such as pre-IPO advisory, valuation
analysis, ESOP advisory, etc., and is constantly exploring newer opportunities such as open offers, buy-backs, de-listings
and QIP / IDR / GDR / FCCB.
The Debt Capital Markets Group has developed and strengthened relationships with almost all the key institutional
investors and has also developed the framework for executing structured finance transactions.
The Infra Group which mainly concentrates on Infrastructure Industry segment, launched into newer businesses such as
Arranging of Private Equity, Advisory roles as well as Arrangement of Finance for M&A and Financial Restructuring, in a
focused manner. Besides continuing Advisory and Credit Syndications for large infrastructure projects, the Group has
established relationships with foreign lenders for ECB Syndications. It also arranged acquisition financing for acquisition
of assets abroad.
The Non-Infra Group has allocated various non-infra sectors amongst various teams so as to tap business relating to
M&A, PE and opportunities available in sale of distressed assets in a more focused manner.
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ANNUAL REPORT024 12-13
ANNEXURE a (contd.)
3. SBICAP's Performance
3.1 Quantitative Performance
3.1.1 Merchant Banking & Advisory Fees
3.1.1.(a) Capital Markets Group- Equity Capital Market (ECM)
3.1.1(b) Debt Capital Markets – DCM
3.1.1(c) Infrastructure Group
The performance of your Company during the year 2012-13 has been discussed hereunder :
The Company booked a fee based income of Rs. 491.24 Crs. during the year and Profit after Tax (PAT) was Rs.296 Crs.
The performance in respect of various activities is as under:
FY13 has been a tough year for equity capital markets with weak investor sentiment and negative macro-economic
outlook. Under the circumstances, Capital Markets Group has been able to achieve net income of Rs.12.98 crores. The
gross cash income (excluding notional income) for CMG is Rs. 16.19 crores for FY13.
A total of 9 companies raised an amount of Rs. 6289.28 cr. through IPOs during the FY13 (source – Prime Database). As nd per League Table for Public Issue Offerings, published by Prime Database SBICAP was ranked 2 in terms of number of
stissues handled, for FY13. SBICAP was ranked 1 in terms of number of OFS issues in respect of Government of India nddisinvestment programme for FY13. SBICAP also ranked 2 in terms of issue size for Rights Issue as per the League Table
published by Prime Database.
Due to volatile markets CMG looked at alternative areas of investment banking which are not directly related to the
prevailing stock market conditions. CMG successfully closed PIPE transaction for an explosive manufacturing company
and other equity capital market related advisories, including valuation advisory mandates, earning a substantial portion
of revenue from these alternative businesses.
During FY13, DCM handled debt issues aggregating around Rs. 75,253 crores. During the year we were the only lead
merchant bankers who handled all the public issue of tax free bonds. SBICAP is ranked No. 1 in terms of number of issues
arranged with respect to Public Issues by Prime Database for FY13.
During the year, with a view to increase the number of services offered to the institution clients, the institution
relationship has been repositioned in our subsidiary company SBICAP Securities Limited(SSL). SSL will now be able to offer
complete solution for Debt viz. private placement, public issues and secondary market placement to the institutional
clients. The Group has developed and strengthened relationships with almost all the key institutional investors. The
Group currently maintains 160 relationships which constitute around 90% of Institutional appetite for Corporate Debt.
The Group has placed debt issues aggregating to around Rs. 59,809 crores on a private placement basis.
The Group successfully completed the private placement of Air India bonds worth Rs 7400 crores- the largest deal of
the year as the sole arranger.
Indian debt syndication market declined by around 50% (as per Dealogic and Thomson Reuters) in CY12 compared to
CY11. This also adversely affected Infrastructure Group's fee income for the financial year 2012-13 which declined by
13.2% over the previous year.
However, despite the substantial decline in absolute numbers, the Group was able to improve its share in the Indian Loan
Arranger market to 52.6% in CY 2012 from 42.4% in the previous year, consolidating its substantial leadership position.
The Group's continued focus and efforts have enabled SBICAP to maintain its No. 1 ranking globally in Project Finance for
the fourth consecutive year since 2009 as per the league tables published by Dealogic. The Company also has the
distinction of being accredited (for the fourth successive year) with India Loan House for the calendar year 2012, for its
leadership in Loan Advisory, by IFR Asia (Thomson Reuters).
Further, the Group achieved the following accolades in FY 2012-13:-
nRanked No.1 by Dealogic : Global PFI/PPP Project Finance Mandated Lead Arrangers and Financial Advisors CY 2012
ANNEXURE a (contd.)
ANNUAL REPORT 02512-13
n Ranked No.1 by Bloomberg: Loans Mandated Arranger – Asia Pacific Ex. Japan CY 2012
nRanked No.2 by Dealogic : Middle East & African Project Finance Loans CY 2012 with a 7.5% market share.
nThomson Reuters – PFI African Oil and Gas Deal of the Year - Bharat Petro Resources – Mozambique
nBusiness World Awards - Deal of the Year – Videocon
Air India and Videocon Industries were also ranked as the No.4 and 7 deals respectively in the Top Ten Deals in
Bloomberg's 2012 Asia Pacific Ex-Japan League tables.
During the year, the Group was able to conclude the first ever USD covered bond for any Indian Corporate for an amount
of USD 647 million for Suzlon Energy. The assignment was completed with combined efforts of the Infrastructure Group
and SBICAP (UK) Ltd. With the success of the deal, the group is now actively working with other investment banks to
fructify similar other transactions. The Group also improved its presence in the international loan markets having deals in
Australia, Bhutan, Georgia, Germany, Kenya, Mozambique, Myanmar, Nepal, Sri Lanka and United States.
The Group was also engaged by Lenders as well as Corporates to work on restructuring mandates and has successfully
closed restructuring deals with aggregate credit facilities of nearly Rs. 57,000 crores during the year including some of the
large and challenging assignments like Suzlon Energy and Hindustan Construction Company.
The Group is actively working on a large number of advisory mandates including M&A, Private Equity, Bid Advisory and
Restructuring Advisory. Clientele of our advisory mandates include several large private corporates as well as PSUs in Oil
and Gas, Power, Metals and Port sectors.
The Non-Infrastructure group successfully closed 16 transactions in the financial year in varied areas of M&A advisory
services, acquisition financing, debt syndication, debt restructuring feasibility services and business valuations. Amongst
other transactions, the team also initiated its foray in the emerging defense sector with an advisory assignment for Tata
Advanced Systems for their acquisition of a domestic Indian company. The team is slated to leverage more effectively the
funding strength and domestic reach of SBI while also use the aspect of SBICAP being the sole Indian member of M&A
International to bring global reach on a single platform for companies to explore both organic and inorganic growth
opportunities.
The Treasury Income for the year ended March 2013 was Rs.45.97 Crs as against Rs.43.09 Crs in the corresponding period
last year. During the period, investments were mostly done on the debt side and focus was on maximizing post-tax
returns. The current year witnessed higher income from bonds compared to last year as higher proportions of funds were
allocated towards corporate bonds. Anticipating the decline in interest rates funds were also locked in tax free bonds at
attractive coupons.
The Company's mission to provide credible, professional and customer focused world class investment banking solutions
has been endorsed by the several awards & recognitions received by the Company.
The Company believes that “Human Resources” are the critical resource for achieving its objectives and values the
resources as “Intellectual Capital”. The Human Resources function in the Company focuses on transformational rather
than transactional processes and continuously strives to align and benchmark its HR policies/practices to the best industry
practices. The Human Resource function understands the needs of the product groups and collaborates with them, thus
contributing to the achievement of the business objectives of the company.
The organization is growing rapidly and to keep pace and fuel the growth, experienced professionals were hired from the
market and through campus recruitments from the premier B-schools. Our people integration model ensures minimum
process time to board people in the Company for faster time to productivity.
Diverse set of professionals are integrated within the Company and by fostering performance behavior the performance
driven culture is well ingrained in the Company. Performances of individuals are differentiated and “Star Performers” who
have contributed significantly to the business goals of the Company are recognized. The employees are rewarded
monetarily as well as by investing in them for their skills development. During the year 2012-13, 27 officials attended
3.1.1(d) Non-Infra Group
3.1.2 Income from Securities- Treasury & Investments
3.2 Qualitative Performance
3.2.1 Human Resources
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ANNUAL REPORT026 12-13
ANNEXURE a (contd.)
Overseas Training/Conferences/ Seminars/Forums/Summits.
The work environment embraces diversity. The Company offers a challenging work environment, fostering a stimulating
work culture of innovation and individual growth.
The HR initiatives for talent development through learning and development programmes have ensured that the
Company has the right competencies and skill sets in its workforce to meet the challenging business objectives.
Focus on Talent Management, Competency Development, Career Progression, Market Related Compensation and
Benefits has helped the Company to attract, motivate and retain the talent as well as build a robust pipeline of future
leaders for the Company.
We are an employer providing equal opportunity to all the employees.
The Information Technology Group is enabling to improve IT Infrastructure and Application for the Company. In the
process, following initiatives were undertaken :
nThe Integrated Lead & Assignment Management (ILAM) System, the core business application has been fine tuned to
incorporate improved processes and provide enhanced controls and MIS.
nPermission for dealing in securities by the employees as required under SEBI Regulations, has been integrated in ILAM
System for better monitoring and governance.
nConsidering the sensitivity of the information handled, application fire wall was deployed at all offices to provide a
secured IT environment system.
nEnterprise collaboration platform SharePoint has been enhanced to meet changing application landscape and Unified
Communication Project is being implemented to significantly enhance productivity.
nInitiatives have been taken to integrate the existing application frame work and re- engineer the existing process.
3.2.2 Information Technology
ANNUAL REPORT 02712-13
ANNEXURE B
Corporate Governance Report
i) Composition of the Board
The principles of Corporate Governance are followed in letter and spirit reflecting our deep belief in such principles and
the pedigree of our parent shareholder. For your Company, Corporate Governance is not just an objective in isolation but
a means to an end - "To be the Best India based Investment Bank".
The Board of Directors comprises Ten Directors out of whom six are independent, i.e. Directors who do not have any
pecuniary relationship or transactions with the Company, its promoters or management, which, in the opinion of the
Board, is likely to affect the independence of judgement of a Director. Given hereunder is the composition of the Board of
Directors along with the brief profiles of the Directors :
th1. Shri Pratip Chaudhuri, Chairman [SBI Nominee]: Shri Chaudhuri is the Chairman of State Bank of India (SBI) since 7
April, 2011 and is also Head of the State Bank Group. His 39 years' experience in State Bank of India has covered a
variety of assignments both in domestic and international banking. He has held a number of important positions,
including those of Dy. Managing Director (International Banking Group), Chief General Manager (Foreign Offices),
Chief General Manager – Chennai Circle, General Manager – Mid-Corporate Strategic Business Unit and General
Manager – Commercial Banking, New Delhi. He also headed State Bank of Saurashtra, and piloted its merger with
State Bank of India.
2. Shri S. Vishvanathan, Non Executive Director [SBI Nominee]: Shri Vishvanathan is the Managing Director & GE
(Associates & Subsidiaries) of State Bank of India. He has over 36 years of Banking experience with SBI. He was
appointed as Managing Director of SBI with effect from 9th October, 2012. Earlier, he was Dy. Managing Director (Mid
Corporate), SBI. Prior to that, he was Managing Director & CEO of SBI Capital Markets Limited (SBICAP) for more than
three years from June 2009 to August 2012. Earlier, he was Chief General Manager of State Bank of India's North
Eastern operations. He has served the bank in several important capacities which include an assignment in New York
Branch and stints as Regional Manager and Deputy General Manager in Delhi Circle and as General Manager (Global
Markets).
3. Smt. Bharati Rao, Non Executive Director [SBI Nominee]: Smt. Rao has over 36 years of experience in the banking
sector. She retired from State Bank of India in October, 2008. During her tenure with the Bank, she had held various
responsible positions. Her 36 years in the Bank have seen a range of assignments both in India and abroad in areas like
Commercial Banking, Project Finance, and International Banking. She was Dy. Managing Director & Chief Credit
Officer, SBI, Corporate Centre, Mumbai with an additional charge as Dy. Managing Director and Group Executive
(Associate Banks) and Dy. Managing Director & CDO at the time of retiring from the Bank's service.
4. Shri Bansi S. Mehta, Non Executive Independent Director: Shri Mehta is a well-known practicing Chartered Accountant
and is a Senior Partner of Bansi S. Mehta & Co., Chartered Accountants. Shri Mehta has rich experience of over 53 years
in the fields of financial management, taxation, accounting and auditing.
5. Shri D. Sundaram, Non Executive Independent Director & Chairman of the Audit Committee: Shri Sundaram is the Vice
Chairman and Managing Director of TVS Capital Funds Ltd. and has over 37 years of experience in the areas of Finance
and Accounting. He was with the HUL group since 1975 and was Vice Chairman of HUL. He was seconded twice to
Unilever, London. He had held important positions such as Commercial Manager & Treasurer, Finance Member–
TOMCO Integration Team, Finance Director BBLIL and Sr. Vice President– Finance, Central Asia & Middle East Group.
6. Shri Narayan K. Seshadri, Non Executive Independent Director: Shri Seshadri is the Chairman and CEO of Halcyon
Group an Investment Advisory and Management Services enterprises specializing in 'turnaround' and 'turn up'
activities. He is a Chartered Accountant. He headed Andersen and KPMG Business Consulting businesses before
founding Halcyon. He carries a rich experience of over 28 years in Finance, Accounts, Audit, Advisory and Management
Services. His experience ranges across industries in different countries.
7. Shri Ashok Kini, Additional Non Executive Independent Director: Shri Kini has over 38 years of experience in the
Banking Sector. He joined State Bank of India (SBI) in December 1967 and retired in December 2005. During his tenure
with SBI, he had held various responsible positions, including those of Managing Director & GE (National Banking), Dy.
Managing Director–Information Technology Dept., Chief General Manager–Information Techology Dept., Chief
General Manager–Techology Planning, General Manager (Commercial Banking), General Manager (Development &
Personal Banking), Dy. General Manager–Industrial Finance-I Dept., and Dy. General Manager–Computer Planning &
Services.
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ANNUAL REPORT028 12-13
ANNEXURE B (contd.)
8. Shri Pradeep Kumar Sarkar, Additional Non Executive Independent Director: Shri Sarkar has over 34 years of experience
in the Banking Sector. He joined State Bank of India (SBI) in November 1967 and retired in November 2001. During his
tenure with SBI, he had held various responsible positions in SBI and SBI Capital Markets Limited (SBICAP), including
those of Dy. Managing Director & GE (International Banking Group), Dy. Managing Director & Chief Financial Oficer,
Chief General Manager - Kolkata, General Manager–SBICAP, New Delhi Regional Office, General Manager-Corporate
Finance, SBICAP, Dy. General Manager-Cadre Management and Dy. General Manager-Main Branch, Kolkata.
9. Smt. Aruna Jayanthi, Additional Non Executive Independent Director: Smt. Jayanthi is the Chief Executive Officer (CEO)
of Capgemini India. Capgemini India is the Capgemini Group's largest delivery centre and main innovation hub with
over 36,000 employees. As the CEO of Capgemini India, Smt. Jayanthi manages the operations of all the business units
in India covering consulting, technology and outsourcing services. In addition, she plays a key role in Leadership
Development and building alignment between HR and Business. She has over 25 years experience in the IT services
industry and has worked in key roles in multinational and Indian system integrator companies. She holds Masters in
Management Studies in Finance from Narsee Monjee Institute of Management Studies (NMIMS). She has been
featured as one of the 'Most Poweful Women' in India Inc. by India's leading business magazine 'Business Today' in its
eighth annual list (2011). She is also ranked 4th in the List of 50 Most Powerful Indian Women by Fortune India
magazine.
10.Smt. Arundhati Bhattacharya, Managing Director & CEO [SBI Nominee]: Smt. Bhattacharya assumed charge as
Managing Director & CEO of SBI Capital Markets Limited (SBICAP), on August 21, 2012. Prior to this assignment, she
was Deputy Managing Director and Corporate Development Officer of State Bank of India. She joined the Bank in the
year 1977 and since then has held various assignments spanning Credit, Forex, Treasury and Retail Operations. She has
also had a stint in the Bank's New York office where she was in charge of monitoring branch performance, overseeing
External Audit and Correspondent Relations. In her extensive service in the Bank she has had the opportunity of
working in Metro, Urban and Rural areas, crisscrossing the length and breadth of the country. She has handled large
Corporate Credit as well as initiatives like Financial Inclusion and financing of Self Help Groups. She was involved in
setting up several new companies / initiatives of the Bank including SBI General Insurance, SBI Macquarie
Infrastructure Fund, SBI SG Global Securities Services, etc., as well as the launch of new IT platforms such as Mobile
Banking and Financial Planning in the Bank.
The Chairman has been appointed by State Bank of India (SBI) in terms of Articles 139(ii) & 157 of the Articles of
Association of the Company.
The Non-Executive Nominee Directors have been appointed by SBI in terms of Articles 139 and 140 of the Articles of
Association of the Company.
The Non-Executive Independent Directors have been appointed as Directors liable to retire by rotation under Section
255 of the Companies Act 1956.
The Additional Non-Executive Independent Directors have been appointed in terms of Article 143A of the Articles of thAssociation of the Company and hold office upto the date of the ensuing 27 Annual General Meeting of the
Company.
The Managing Director & CEO has been appointed by SBI in terms of Article 168 of the Articles of Association of the
Company.
The Board of Directors focuses on monitoring the business operations and the development of business strategies,
while the task of reviewing matters such as status of overdues, status of litigations etc., are delegated to a Committee
of Directors (COD) constituted for the purpose by the Board.
The Board has evolved a Calendar of Reviews, which has identified the various reports/reviews to be submitted on a
periodical basis to the Board/COD/Audit Committee and the said Calendar of Reviews is strictly followed.
The Independent Directors play a very crucial role in the Board meetings and their wide experience, expertise and
knowledge of economics, finance, capital markets, taxation, accounting, auditing etc., have benefited the Company
immensely.
ii) Tenure
iii) Responsibilities
iv) Role of the Independent Directors
ANNUAL REPORT 02912-13
ANNEXURE B (contd.)
v) Board Meetings
During the year under review, 9 Board Meetings were held and the attendance record of each Director at the said
Board Meetings is given hereunder :-
vi) Composition and role of the Audit Committee and the scope of Internal Audit Function
vii) Strengthening of the compliance systems
viii) Compliance with SEBI 's Prohibition of Insider Trading Regulations
ix) Directors are duly qualified to act as such
DECLARATION
An Audit Committee comprising Shri D. Sundaram, Chairman, Shri Narayan K. Seshdadri and Shri S. Vishvanathan,
Directors, is operational and the composition of the Audit Committee as well as its role and functions are broadly in
conformity with the stipulations of the Kumar Mangalam Birla Committee Report on Corporate Governance, and
Section 292A of the Companies Act, 1956.
The Company has set in place an effective system to ensure compliance with all the applicable Laws/Statutes and the
same is monitored by the Compliance & Risk Management Dept.
With a view to preventing insider trading, a suitable Code of Conduct has been set in place to regulate the dealings in
securities by all the employees of the Company and compliance with the same is monitored by the Assistant Vice
President (Compliance & Risk Management). The Code of Conduct of the Company is in conformity with the SEBI
(Prohibition of Insider Trading) Regulations, 1992.
As per the declarations submitted to the Company, all the Directors are duly qualified to act as such and none of them
is disqualified under section 274(1)(g) of the Companies Act, 1956. This aspect has also been verified by the Statutory
Auditors of the Company.
I confirm that all Board Members and Senior Management have affirmed compliance with the Company's Code of stConduct for the financial year ended 31 March, 2013.
(Arundhati Bhattacharya)
Managing Director & CEO
4
3
7
7
6
Name of the Director Number of Board Meetings
attended
Shri Pratip Chaudhuri,
Shri S. Vishvanathan, 4 (3 in the capacity as Managing Director & thNominee Director, (SBI Nominee) CEO, SBICAP upto 17 August, 2012, and 1
after appointment as SBI Nominee Director rdw.e.f. 3 December, 2012)
Smt. Bharati Rao, Nominee Director, (SBI Nominee)
Shri Bansi S. Mehta, Non Executive Independent Director
Shri D. Sundaram, Non Executive Independent Director
Shri Narayan K. Seshadri, Non Executive Independent Director
Shri Ashok Kini, 4 (appointed as Additional Independent thAdditional Non Executive Independent Director Director w.e.f. 18 October, 2012)
Shri P.K. Sarkar, 5 (appointed as Additional IndependentAdditional Non Executive Independent Director Director w.e.f. 18th October, 2012)
Smt. Aruna Jayanthi, 2 (appointed as Additional Independent Additional Non Executive Independent Director Director w.e.f. 18th October, 2012)
Smt. Arundhati Bhattacharya, 6 (appointed as Managing Director & CEO,stManaging Director & CEO, (SBI Nominee) SBICAP w.e.f. 21 August, 2012)
Chairman, (SBI Nominee)
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ANNEXURE C
thShri Vishal Sr. Vice 60,98,956/- 9 October, B. Chem., Reliance
Gupta President – 2006 MFM, Gen. Industries
Infra Management Limited, DGM
Course IIM- 21/45
Engg,
thShri Rakesh Sr. Vice 66,48,355/- 5 April, 2011 B. Sc.(Hons), J. P. Morgan
Joshi President – CAIIB– Part I, Services India
Debt Capital - 29/51 Private Limited,
Market Executive Director
thShri Supratim Executive Vice 97,73,949/- 7 November, B.E. (Mech. IDBI LTD, DGM
Sarkar President & 2000 Engg.) M. Tech,
Group Head - MBA, - 22/47
Infra
Name Designation/ Remuneration Date of Qualification Last Employment
Nature of duties (Rs.) commencement and Experience/ held,
of employment Age -years Designation
STATEMENT PURSUANT TO SECTION 217(2A) OF THE COMPANIES ACT, 1956 AND COMPANIES (PARTICULARS OF EMPLOYEES) RULES, 1975
(A) Employed throughout the year and are in receipt of remuneration aggregating not less than Rs. 60,00,000/-
per annum
(B) Employed for part of the year and are in receipt of remuneration aggregating not less than Rs. 5,00,000/-
per month
thShri Sanjeev Sr. Vice 65,56,981/- 16 March, B.Sc. , B.Tech.,
Agarwal President – 2006 DBF, ICFAI
Infra - 25/47
IDBI LTD, DGM
NIL
NOTES :
1) The above remuneration includes salaries, allowances, arrears of salary, leave encashment, performance linked variable pay, monetary value of perquisites as per Income Tax Rules, reimbursement of Leave Travel Allowance and Medical expenses claimed during the year, Company's contribution to Provident and Superannuation Funds.
2) Other terms and conditions of service include Company's contribution to Gratuity fund.
3) The nature of employment – all employments are non contractual.
4) % of equity shares held by the employee in the Company within the meaning of sub-clause (iii) of clause (a) of Section 217(2A) of the Companies Act, 1956 – Nil.
5) The employees are not related to any Directors of the Company.
For and on behalf of the Board of Directors
Place : Mumbai Pratip Chaudhuri
Date : 1st August 2013 Chairman
stShri Rajat Sr. Vice 65,24,399/- 1 June, B.Tech., (Mech.
Misra President – 1999 Engg.), PGDBM BHEL, Advance
Infra (Finance) - 19/43 Research ProjectDiv.
Sr. Engineer,
INDEPENDENT AUDITOR'S REPORT
ANNUAL REPORT 03112-13
To the Members of SBI Capital Markets Limited
We have audited the accompanying financial statements of SBI Capital Markets Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2013 and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.
Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (“the Act”). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2013;(b) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and(c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.
1. As required by the Companies (Auditor's Report) Order, 2003 as amended by Companies (Auditor's Report) (Amendment) Order, 2004 (together 'the Order'), issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
a. we have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit;
b. in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;
c. the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this Report are in agreement with the books of account;
d. in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956;
e. on the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;
For SUDIT K PAREKH & CO.Chartered AccountantsFirm Registration No.: 110512W
(D.S. Khatri)PartnerMembership Number: 16306 Mumbai, dated: April 26, 2013
Report on the Financial Statements
Management's Responsibility for the Financial Statements
Auditor's Responsibility
Opinion
Report on Other Legal and Regulatory Requirements
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ANNUAL REPORT032 12-13
(Referred to in our report of even date)
i. In respect of its fixed assets:
a. The Company has maintained proper records showing full particulars, including quantitative details and the
situation of fixed assets.
b. All fixed assets, except certain leased assets were physically verified by the management in the current year in
accordance with a planned program of verifying them which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets. Certain leased fixed assets have not been physically verified
where, as per the terms of the agreement, the Company obtains confirmation from the lessee on the regular
basis. As informed no material discrepancies were noted on such verification.
c. Fixed assets disposed off during the period were not substantial and therefore do not affect the going concern
assumption.
ii. In respect of inventories
a. The securities held as stock in trade and in custody of the Company have been physically verified by the
management at reasonable intervals while securities held by the custodian are verified with the confirmation
statement received from them on a regular basis. In our opinion, the frequency of such verification is reasonable.
b. The procedures of physical verification of inventory followed by the management are reasonable and adequate
in relation to the size of the Company and the nature of its business.
c. The Company is maintaining proper records of inventory and no discrepancies were noticed on comparing the
physical securities/statement from custodian with book records.
iii. According to the information and explanations given to us, the Company has not granted any loans, secured or
unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Act.
Accordingly sub clauses (b), (c), (d), (e), (f) and (g) of clause (iii) of the Order are not applicable
iv. In our opinion and according to the information and explanations given to us, there is adequate internal control
system commensurate with the size of the Company and the nature of its business with regard to purchases of fixed
assets and sale of services. During the course of our audit, we have not observed any continuing failure to correct
major weaknesses in internal control system of the Company.
v. According to the information and explanations provided by the management, we are of the opinion that the
particulars of contracts or arrangements referred to in section 301 of the Act that need to be entered into the register
maintained under section 301 have been so entered. Accordingly, sub clause (b) of clause (v) of the Order is not
applicable to the Company for the current period.
vi. The Company has not accepted any deposits from the public.
vii. In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.
viii. The provisions of Section 209(1) (d) of the Companies Act, 1956 are not applicable to the Company.
ix. In respect of Statutory Dues:
a. According to the information and explanations given to us, the Company is regular in depositing with
appropriate authorities undisputed statutory dues including provident fund, income-tax, sales-tax, service tax
and other material statutory dues applicable to it. The provisions of Investor Education and Protection Fund,
wealth tax, customs duty, excise duty and cess are not applicable to the Company in the current year.
b. According to the information and explanations given to us, no undisputed amounts payable in respect of
provident fund, income-tax, service tax, sales-tax, cess and other undisputed statutory dues were outstanding,
at the year end, for a period of more than six months from the date they became payable.
c. According to the records of the Company, the dues outstanding of income-tax , sales-tax, wealth-tax, service
tax,, custom duty, excise duty and cess on account of any dispute, are as follows:
x. The Company has no accumulated losses at the end of the financial year and it has not incurred cash losses in the
current and immediately preceding financial year.
Re: SBI CAPITAL MARKET LIMITED
ANNEXURE TO THE AUDITORS' REPORT
ANNUAL REPORT 03312-13
Income Tax Act, 1961 Issue relating to 1925.50 AY 1989-1990
disallowance of to AY 1997- Income Tax
expenses 1998 (Appeals) and
Income Tax
1605.55 AY 1998-1999 Appellate
to AY 2009- Tribunal (ITAT)
2010
Sales Tax (Central Issues relating to 23.13 1991-96 Commissioner
and State) lease tax Sales Tax
Bombay Sales Tax Issues relating to 8.59 1998-99 to Commissioner
Act, 1959 sales tax 2000-2001 Sales Tax
Commissioner of
xi. According to the information and explanations given to us, and based on checks carried out by us, the Company has not defaulted in repayment of dues to financial institutions or banks. The Company has not issued any debentures during the year.
xii. According to the information and explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.
xiii. According to the information and explanations given to us, the provisions of Chit Funds or Nidhi or mutual benefit fund or society are not applicable to the Company; accordingly clause (xiii) of the Order is not applicable to the Company.
xiv. In respect of dealing/trading in shares, securities, debentures and other investments, in our opinion and according to the information and explanations given to us, proper records have been maintained of the transactions and contracts and timely entries have been made therein. The shares, securities, debentures and other investments have been held by the Company, in its own name.
xv. According to information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions
xvi. The Company did not have any term loans outstanding during the year.
xvii.According to the information and explanations given to us, and on an overall examination of the balance sheet of the Company, funds raised on short-term basis have, prima facie, not been used during the year for making long-term investments
xviii. The Company has not made any preferential allotment of shares during the year.
xix. The Company has not issued any debentures during the year.
xx. The Company has not raised any money through a public issue.
xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.
For SUDIT K PAREKH & CO.
Chartered Accountants
Firm Registration No. 110512W
(D.S. Khatri)PartnerMembership No. 16316 Mumbai; dated: April 26, 2013
Forum where
dispute is pending
Amount
(Rs. In lacs)
Period to which the
amount relatesNature of duesName of the statute
ANNEXURE TO THE AUDITORS' REPORT (contd.)
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ANNUAL REPORT034 12-13
CAG COMMENTS
COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDER SECTION 619(4) OF THE COMPANIES ACT,
1956 ON THE ACCOUNTS OF SBI CAPITAL MARKETS LIMITED FOR THE YEAR ENDED 31 MARCH 2013
The preparation of financial statements of SBI Capital Markets Limited for the year ended 31 March 2013 in accordance
with the financial reporting framework prescribed under the Companies Act, 1956 is the responsibility of the
management of the company. The Statutory Auditor appointed by the Comptroller and Auditor General of India under
Section 619(2) of the Companies Act, 1956 is responsible for expressing opinion on these financial statements under
Section 227 of the Companies Act, 1956 based on independent audit in accordance with the Auditing and Assurance
Standards prescribed by their professional body, the Institute of Chartered Accountants of India. This is stated to have
been done by them vide their Audit Report dated 26 April 2013.
I, on the behalf of the Comptroller and Auditor General of India, have conducted a supplementary audit under section
619(3)(b) of the Companies Act, 1956 of the financial statements of SBI Capital Markets Limited for the year ended 31
March 2013. This supplementary audit has been carried out independently without access to the working papers of the
statutory auditor and is limited primarily to inquiries of the statutory auditor and company personnel and a selective
examination of some of the accounting records. On the basis of my audit nothing significant has come to my knowledge
which would give rise to any comment upon or supplement to Statutory Auditor's report under section 619(4) of the
Companies Act, 1956.
For and on behalf of the
Comptroller and Auditor General of India
(Y. N. Thakare)
Principal Director of Commercial Audit &
Ex-officio Member, Audit Board-I, Mumbai
Place: Mumbai
Date: 11 June 2013
ANNUAL REPORT 03512-13
EQUITY AND LIABILITIES
TOTAL
ASSETS
TOTAL
SHAREHOLDERS' FUNDS
Share capital 2.1 5,803 5,803
Reserves and surplus 2.2 83,379 71,316
89,182 77,119
NON-CURRENT LIABILITIES
Other long-term liabilities 2.3 259 731
Long-term provisions 2.4 913 679
1,172 1,410
CURRENT LIABILITIES
Trade payables 2.5 1,853 3,285
Other current liabilities 2.6 2,152 2,928
Short-term provisions 2.4 2,523 1,941
6,528 8,154
96,882 86,683
NON-CURRENT ASSETS
Fixed Assets 2.7
Tangible Asset 960 1,071
Intangible Assets 74 64
Non-current investments 2.8 20,521 22,543
Deferred tax assets (net) 2.21 1,298 437
Long-term loans and advances 2.9 5,861 6,745
Trade receivables 2.10 19 19
Other non-current assets 2.11 - 306
28,733 31,185
CURRENT ASSETS
Current investments 2.8 5,000 -
Inventories 2.12 19,530 18,418
Trade receivables 2.10 25,333 13,018
Cash and cash equivalents 2.13 16,774 22,711
Short-term loans and advances 2.9 338 152
Other current assets 2.11 1,174 1,199
68,149 55,498
96,882 86,683
NOTES TO ACCOUNTS 1 & 2
The accompanying notes are an integral part of the financial statements.
As per our report of even date
For SUDIT K PAREKH & CO. For and on behalf of Board of DirectorsFirm Registration No. 110512WChartered Accountants
Durgaprasad Khatri Pratip Chaudhuri Arundhati Bhattacharya Nilesh N. Shah
Partner Chairman Managing Director & CEO Company Secretary
Membership No.: 16316
Mumbai
April 26, 2013
As at 31st
March-13Notes As at 31st
March-12
BALANCE SHEET AS AT 31ST MARCH 2013
(Rupees in lacs unless otherwise stated)
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ANNUAL REPORT036 12-13
Statement of Profit and Loss for the year ended 31st March 2013
INCOME
EXPENDITURE
PROFIT BEFORE TAX
PROFIT FOR THE YEAR
Revenue from operations 2.14 52,806 46,265
Other income 2.15 2,171 2,816
54,977 49,081
Employee benefit expenses 2.16 7,586 7,773
Interest expense 2.17 1 -
Depreciation and amortisation expense 2.7 280 240
Other expenses 2.18 4,540 4,225
Provisions 2.19 731 357
13,138 12,595
41,839 36,486
Provision for current income-tax (13,100) (11,300)
Deferred tax credit 2.21 861 (88)
29,600 25,098
Earning per share (Basic and Diluted in Rs.)
(Face value Rs.10/- per share) 51.00 43.25
NOTES TO ACCOUNTS 1 & 2
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
NotesFor the year ended
31st March-13
For the year ended
31st March-12
(Rupees in lacs unless otherwise stated)
As per our report of even date
For SUDIT K PAREKH & CO. For and on behalf of Board of DirectorsFirm Registration No. 110512WChartered Accountants
Durgaprasad Khatri Pratip Chaudhuri Arundhati Bhattacharya Nilesh N. Shah
Partner Chairman Managing Director & CEO Company Secretary
Membership No.: 16316
Mumbai
April 26, 2013
ANNUAL REPORT 03712-13
CASH FLOW STATEMENT
Cash flow from operating activities :-
I. Net cash from operating activities
Cash flow from investing activities :-
II. Net cash from investing activities
Net profit before taxation 41,839 36,486
Adjustments for -
(Profit) / Loss on sale of assets(net) (1) 10
Profit on sale of long term investments 84 7
Interest on long term investments (1,636) (562)
Dividend income (2,034) (1,842)
Interest expenses 1 -
Depreciation 280 240
Provision on investments (net of write-back) 273 222
Provision for doubtful debts (net of write-back) 405 71
(2,628) (1,854)
Operating profit before working capital changes 39,211 34,632
Decrease /(increase) in trade receivables - current (12,721) (6,128)
Decrease /(increase) in interest / dividend accrued 54 (129)
Decrease /(increase) in short-term loans & advances (941) (1,530)
Decrease /(increase) in long-term loans & advances 884 1,475
Decrease/(increase) in stock-in-trade (1,112) (9,894)
(Decrease)/increase in current liabilities (2,207) 1,361
(Decrease)/increase in long-term liabilities (472) (1)
(Decrease)/increase in provision for gratuity 77 89
(Decrease)/increase in Provision for compensated absences 174 279
(16,264) (14,478)
Cash generated from operations 22,947 20,154
Income tax paid (12,345) (9,778)
(12,345) (9,778)
10,602 10,376
Purchase of fixed assets (216) (385)
Capital Work in progress - 52
Sale of fixed assets 38 15
Interest on long term investments 1,636 562
Dividend income 2,034 1,842
Purchase of investments (5,752) (6,220)
Sale of investments 2,416 2,850
156 (1,284)
For the year ended
31st March-2012
For the year ended
31st March-2013
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ANNUAL REPORT038 12-13
CASH FLOW STATEMENT (contd.)
For the year ended
31st March-2012
For the year ended
31st March-2013
Cash flow from financing activities :-
III. Net cash used in financing activities
Net change in cash & cash equivalents (I+II+III)
Interest expenses (1) -
Dividend payment (15,089) (11,607)
Tax on dividend payment (1,883) (2,169)
(16,973) (13,776)
(6,215) (4,684)
Cash & cash equivalents at the beginning of the year 22,988 27,671
Cash & cash equivalents at the end of the year 16,773 22,988
Cash and cash equivalent included in cash flow statement comprise the following balance sheet amounts :-
As at 31st As at 31st
Mar-13 Mar-12
Cash on hand - -
Balances with scheduled banks current accounts 16,773 22,988
16,773 22,988
(Excludes amounts placed as deposits with scheduled
banks towards cash margin for various guarantees 1 20
issued by banks on behalf of the Company.)
THE CASH FLOW STATEMENT AND THE NOTES TO ACCOUNTS FORM AN INTEGRAL PART OF THE ACCOUNTS.
As per our report of even date
For SUDIT K PAREKH & CO. For and on behalf of Board of DirectorsFirm Registration No. 110512WChartered Accountants
Durgaprasad Khatri Pratip Chaudhuri Arundhati Bhattacharya Nilesh N. Shah
Partner Chairman Managing Director & CEO Company Secretary
Membership No.: 16316
Mumbai
April 26, 2013
(Rupees in lacs unless otherwise stated)
1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
a) Basis of preparation
b) Use of estimates
c) Fixed Assets and Depreciation
d) Intangible Assets
e) Impairment
f) Investments
g) Stock-in-trade
The financial statements have been prepared to comply in all material respects with the standards notified by the
Companies Accounting Standards Rules, 2006 and the relevant provisions of the Companies Act, 1956. The financial
statements have been prepared under the historical cost convention on an accrual basis, except in case of assets for
which provision for impairment is made and revaluation is carried out. The accounting policies have been
consistently applied by the Company and are consistent with those used in the previous year.
The preparation of financial statements in conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent liabilities at the date of the financial statements and the results of operations during the
reporting period end. Although these estimates are based upon management's best knowledge of current events
and actions, actual results could differ from these estimates.
Fixed assets are stated at cost less accumulated depreciation and impairment loss, if any. Cost comprises the
purchase price and any attributable cost of bringing the asset to its working condition for its intended use.
Depreciation on fixed assets, other than leased fixed assets, software, computers, mobiles and blackberries is
provided using the written down value at the rates prescribed in Schedule XIV to the Companies Act, 1956, on a pro-
rata basis. Computers, mobiles and blackberries are depreciated over a period of three years on straight line basis
The rates applied for all assets are equal to or higher than the rates based on the useful lives.
In case of fixed assets leased prior to April 1, 2001, depreciation is provided using the straight-line method at the
rates prescribed in Schedule XIV to the Companies Act, 1956, on a pro-rata basis, or amount worked out in the ratio
of lease rentals accrued as per the agreement to the lease rentals for the entire primary period of lease, whichever is
higher (on a cumulative basis). This method is followed in preference to the recommendations made by the Institute
of Chartered Accountants of India, in its Guidance Note, 'Accounting for Lease'. This Guidance Note is
recommendatory in nature.
The leasehold Improvements have been written off over the balance period of lease.
Software is amortized over a period of 3 years on a straight line basis.
The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment
based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset
exceeds its recoverable amount. The recoverable amount is the greater of the asset's net selling price and value in
use. In assessing value in use, the estimated future cash flows are discounted to their present value at the weighted
average cost of capital.
After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life
Investments include equity shares, preference shares, debt instruments and units of mutual funds, which are
intended to be held to maturity or for a period of not less than one year are classified as long term investments. All
other investments are classified as Current investments.
Long-term investments are carried at cost arrived at on a weighted average basis and are stated net of provision.
Cost comprises purchase price, brokerage and stamp duty. Appropriate provision is made for, other than temporary
diminution in the value of investments.
Securities acquired and held, principally for the purpose of selling them in the near term, are classified as stock-in-
trade.
Quoted securities are valued at lower of cost and market value. Unquoted equity shares are valued at the lower of
cost and break-up value. Unquoted debt instruments are valued in accordance with the valuation guidelines issued
by the Fixed Income Money Market and Derivatives Association of India (FIMMDA). Accordingly, stock of
government dated securities, corporate/FI debentures/bonds are valued at lower of cost or market/fair value.
Notes to Financial Statements for the year ended 31st March 2013
ANNUAL REPORT 03912-13
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(Rupees in lacs unless otherwise stated)
Appropriate provisions, as prescribed by Non-Banking Financial Companies Prudential Norms (Reserve Bank)
Directions, 1998 are made for non-performing debt instruments. The discount, if any, is amortised over the holding
period of the instrument based on the original yields for the residual maturities and the carrying value of the
instrument is adjusted correspondingly. Units of mutual fund are valued at lower of cost and net asset value.
Cost comprises purchase price, brokerage, stamp duty and any premium, if paid and is computed on weighted
average basis. The market value is the price at which the securities are traded in the market. In the absence of such
market price, the market value is derived based on market related spreads over the Government benchmark curve, as
specified in FIMMDA guidelines, for applicable securities.
Revenue is recognized to the extent that it is probable that economic benefits will flow to the Company and revenue
can be easily measured.
Fee based Income:
nIssue management and advisory fees are recognised as per the terms of the agreement with the client, net of
pass- through.
nFees for private placement are recognised on completion of assignment.
Income from securities:
n? Gains and losses on the sale of securities are recognised on trade date.
nDividend is accounted on an accrual basis where the right to receive the dividend is established.
nInterest is recognised on a time proportion basis taking into account the amount outstanding and the rate
applicable except interest in respect of non-performing/doubtful assets which is recognised on cash basis.
Initial Recognition
Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the
exchange rate between the reporting currency and the foreign currency at the date of the transaction.
Conversion
Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms
of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the
transaction; and non-monetary items which are carried at fair value or other similar valuation denominated in a
foreign currency are reported using the exchange rates that existed when the values were determined.
Exchange Differences
Exchange differences arising on the settlement of monetary items or on the reporting date due to rates different
from those at which they were initially recorded during the year, or reported in previous financial statements, are
recognised as income or as expenses in the year in which they arise except those arising from investments in non-
integral operations.
Retirement benefits to employees comprise gratuity, superannuation, provident fund and pension fund. The
Company's employees are covered under the employees' gratuity scheme and superannuation scheme established
by the Life Insurance Corporation of India ('LIC').
Retirement benefits in the form of Provident Fund and Superannuation Fund are a defined contribution scheme and
the contributions are charged to the Profit and Loss Account of the year when the contributions to the respective
funds are due. There are no other obligations other than the contribution payable to the respective trusts.
Gratuity liability is a defined benefit obligation and is provided for on the basis of an actuarial valuation on projected
unit credit method made at the end of each financial year.
Short term compensated absences are provided for on based on estimates. Long term compensated absences are
provided for based on actuarial valuation. The actuarial valuation is done as per projected unit credit method made
at the end of each financial year.
Actuarial gains/losses are immediately taken to profit and loss account and are not deferred.
Tax expense comprises current and deferred taxes. Current income tax is measured at the amount expected to be
paid to the tax authorities in accordance with the Income Tax Act. Deferred income taxes reflect the impact of current
h) Revenue recognition
i) Foreign currency transactions
j) Retirement and other employee benefits
k) Income taxes
Notes to Financial Statements for the year ended 31st March 2013
ANNUAL REPORT040 12-13
(Rupees in lacs unless otherwise stated)
year timing differences between taxable income and accounting income for the year and reversal of timing
differences of earlier years.
Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance
sheet date. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient
future taxable income will be available against which such deferred tax assets can be realised. Deferred tax assets are
recognised on carry forward of unabsorbed depreciation and tax losses only if there is virtual certainty supported by
convincing evidence that such deferred tax assets can be realised against future taxable profits.
At each balance sheet date the Company re-assesses unrecognised deferred tax assets. It recognises deferred tax
assets to the extent that it has become reasonably certain or virtually certain, as the case may be that sufficient future
taxable income will be available against which such deferred tax assets can be realised.
The carrying amount of deferred tax assets are reviewed at each balance sheet date. The company writes-down the
carrying amount of a deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the
case may be, that sufficient future taxable income will be available against which deferred tax asset can be realised.
Any such write-down is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may
be, that sufficient future taxable income will be available.
Basic and diluted earnings per share are reported in accordance with AS 20, “Earnings Per Share”. Basis earnings per
equity share has been computed by dividing net profit after tax by weighted average number of equity shares
outstanding for the year. Diluted earnings per equity share have been computed using the weighted average
number of equity shares and dilutive potential equity shares outstanding during the year.
A provision is recognised when an enterprise has a present obligation as a result of a past event and it is probable
that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be
made. Provisions are not discounted to the present value and are determined based on the best estimate required to
settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect
the current best estimates.
Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of
which will be confirmed only by the occurrence or non occurrence of one or more uncertain future events not wholly
within the control of the company or when there is a present obligation that arises from past events where it is either
not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be
made.
Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term, are
classified as operating leases. Operating lease payments are recognised as an expense in the profit and loss account
on a straight line basis over the lease term.
The Company's primary segments are businesses, which are organised around the following service lines:
n Fee-based segment provides merchant banking and advisory services like issue management, underwriting,
arrangement, project advisory & structured finance.
nFund-based segment undertakes deployment of funds in leasing / hire purchase and dealing in various
securities.
nOther' segment includes fee income and other corporate income and expenses, which are either not allocable to
any specific business segment or not material enough to warrant a separate disclosure as a reportable
segment.
nThe risk and returns of the business of the Company is neither associated with geographical segmentation nor
are the clients of the Company grouped geographically. Hence there is no secondary segment reporting based
on geographical segment. Common costs identifiable with each segment have been allocated, based on the
relative utilisation of such benefits by each segment, out of the total costs.
Cash and cash equivalents in the balance sheet comprise cash at bank and in hand and short-term investments with
an original maturity of three months or less.
l) Earnings per share
m) Provisions & Contingent Liabilities
n) Operating Lease
o) Segment information – basis of preparation
p) Cash and Cash equivalents
Notes to Financial Statements for the year ended 31st March 2013
ANNUAL REPORT 04112-13
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(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013
NOTE - 2.1
SHARE CAPITAL
Authorised
Issued, subscribed and paid up
NOTE - 2.2
RESERVES AND SURPLUS
Securities premium Account
General reserve
Closing Balance
Surplus/(deficit) in the statement of profit and loss
Net Surplus in the statement of profit and loss
TOTAL RESERVES AND SURPLUS
NOTE - 2.3
Other Long Term Liabilities
100,000,000 (2012: 100,000,000) Equity shares of Rs.10/- each 10,000 10,000
1,000,000 (2012: 1,000,000) Redeemable preference shares of Rs. 100/- each 1,000 1,000
11,000 11,000
58,033,711 (2012: 58,033,711)
Equity shares of Rs.10/- each fully paid up 5,803 5,803
The Company is wholly owned subsidiary of State Bank of India ('SBI') along with its nominees and shareholders are
eligible for one vote per share held.
There has been no movement in the number of shares outstanding at the beginning of the period and at the end of
period, consequently the reconciliation of the number of the shares outstanding at the beginning and at the end of
the reporting period is not applicable.
6,347 6,347
Balance as per the last financial statements 27,987 25,477
Add : amount transferred from surplus balance in the
statement of profit and loss 2,960 2,510
30,947 27,987
Balance as per the last financial statements 36,982 27,884
Profit for the year 29,600 25,098
Less : Appropriations
Interim dividend 15,089 11,607
Dividend distribution tax 2,448 1,883
Transfer to general reserve 2,960 2,510
Total Appropriations 20,497 16,000
46,085 36,982
83,379 71,316
Trade Payables other than dues to Micro, Medium and
Small Enterprises 11 483
Lease Deposits 248 248
259 731
As at 31st
March-12
As at 31st
March-13
2. OTHER NOTES
ANNUAL REPORT042 12-13
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
NOTE - 2.4
PROVISIONS
Provision for employee benefits
Other provisions
NOTE - 2.5
Trade Payables
NOTE - 2.6
Other Current Liabilities
Long-term Short-term
Provision for gratuity 282 204 - -
Provision for compensated absences 631 475 75 58
Provision for dividend distribution tax - - 2,448 1,883
913 679 2,523 1,941
Trade Payables of Micro, Medium and Small Enterprises - -
Trade Payables other than Micro, Medium and
Small Enterprises 1,853 3,285
1,853 3,285
Bonus payable 2,030 2,241
Advance received from customers 36 16
TDS Payable 85 671
Professional Tax Payable 1 -
2,152 2,928
As at 31st
March-12
As at 31st
March-13
As at 31st
March-13
As at 31st
March-13
ANNUAL REPORT 04312-13
SB
I C
APIT
AL
MA
RK
ETS L
IMIT
ED
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
Le
ased
Ass
ets
Bala
nce
As
at
1st
Ap
ril 1
1
1
,60
0 5
96
5
31
25
234
-
4,0
20
133
7,1
66
Ad
dit
ion
s
-
1
74
51
7
111
55
-23
385
Ded
uct
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s/Tr
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- 1
17
3
83
36
--
0194
Bala
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at
31
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ar
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411
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--
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at
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ar
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s -
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--
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216
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s/Tr
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- 6
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--
-128
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at
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arc
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0 6
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55
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7,4
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Bala
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at
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Ap
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2 4
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326
11
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280
Ded
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- 4
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--
-91
Bala
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As
at
31
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arc
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1,1
27
5
13
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17
16
215
26
4,0
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131
6,4
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73
1
59
1
52
12
819
29
-74
1,0
34
No
te :
I. B
uild
ing
in
clu
des
cost
of
15 s
hare
s o
f Rs.
10
0/-
each
held
by
the C
om
pan
y in
a c
o-o
pera
tive
ho
usi
ng
so
ciety
.
GR
OS
S B
LO
CK
AC
CU
MU
LA
TED
DEP
REC
IATIO
N /
AM
OR
TIS
ATIO
N
NET B
LO
CK
As
at
31st
Mar
12
GR
OS
S B
LO
CK
AC
CU
MU
LA
TED
DEP
REC
IATIO
N /
AM
OR
TIS
ATIO
N
NET B
LO
CK
As
at
31st
Marc
h 1
3
NO
TE -
2.7
Bu
ildin
g(R
efe
rN
ote
I)
Co
mp
ute
rsFu
rnit
ure
& F
ixtu
res
INTA
NG
IBLE
ASSETS
TAN
GIB
LE A
SSETS
Tota
lSo
ftw
are
Plan
t,M
ach
iner
y&
Equ
ipm
ents
Leas
eho
ldIm
prov
emen
tV
eh
icle
sO
ffic
eEq
uip
men
ts
ANNUAL REPORT044 12-13
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
NOTE - 2.8
NON-CURRENT INVESTMENTS Other investments
(Long term, non trade, at cost unless otherwise stated)
Investment in Equity Instruments (quoted)
Sub-total
Bonds (quoted)
Sub-total
Total quoted investments
Other InvestmentsInvestment in Equity Instruments (unquoted)
Sub-total
2,40,000 (2012: 2,40,000) shares of Re.1/- each 173 197
fully paid in Indian Hotels Ltd
At cost less provision other than temporary diminution in
value Rs. 139 (2012: Rs.115))
1,12,500 (2012:1,12,500) shares of Rs.10/- each 345 345
fully paid in Hindustan Petroleum Corp. Ltd.
(At cost less provision other than temporary diminution in
value Rs. 70 (2012: Rs.70))
2,00,000 (2012: 2,00,000) shares of Rs.10/- each 265 265
fully paid in Gateway Distriparks Ltd.
(At cost less provision other than temporary diminution in
value Rs. 29(2012: Rs.29))
Nil (2012: 21,120) shares of Re.1/- each - - fully paid in Penta Media Graphics Ltd
At cost less provision other than temporary diminution in
value Nil (2012: Rs. 343))
783 807
5,000 (2012 :5,000) 6.85% tax free bonds of India Infrastructure Finance 5,000 5,000
Co. Ltd of Rs. 1,00,000/- each fully paid
54,876 ( 2012 : 54,876) 8.20% bonds of National Highway Authority 549 549
of India Ltd (Taxfree) of Rs. 1,000/- each fully paid
71,197( 2012 : 71,197) bonds of 8.20% Power Finance Corp 712 712
Ltd (Taxfree) of Rs. 1,000/- each fully paid
3,04,510 (2012 : 3,04,510) 8.10% bonds of India Railways Finance 3,045 3,045
Corp. Ltd (Taxfree) of Rs. 1,000/- each fully paid
1,00,000 ( 2012 : Nil ) bonds of 7.38% Rural Electrification Corp Ltd 1,000 -
(Taxfree) of Rs. 1,000/- each fully paid
1,00,000 ( 2012 : Nil ) bonds of 7.34 % Indian Railways Finance Corp. Ltd 1,000 -
(Taxfree) of Rs. 1,000/- each fully paid
11,306 9,306
12,089 10,113
19,50,000 (2012: 19,50,000) shares of Rs.10/- each 341 341
fully paid in National Stock Exchange of India Ltd
10,32,500 (2012: 10,32,500) shares of Rs.10/- each *- *-
fully paid in SBI Home Finance Ltd
(At cost less provision other than temporary diminution in
value Rs. 103(2012: Rs.103))
11,00,000 (2012: 11,00,000) shares of Rs.10/- each 110 110
fully paid in OTC Exchange of India
5,35,768 (2012: 5,35,768) shares of Rs.10/- each 54 54
fully paid in Investor Services of India Ltd
10,00,000 (2012: 10,00,000) shares of Rs.39.63/- each 396 396
fully paid in ONGC Mittal Energy Ltd
901 901
As at 31st
March-13
As at 31st
March-12
ANNUAL REPORT 04512-13
SB
I C
APIT
AL
MA
RK
ETS L
IMIT
ED
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
Investment in Equity Instruments - Associates (unquoted)
Sub-total
Investment in Equity Instruments - wholly owned subsidiaries (unquoted)
Sub-total
Other InvestmentsInvestment in Bonds (unquoted)
Sub-total
Investment in Mutual Funds (unquoted)
Sub-total
Total unquoted investments
Total investments
Current Investments (bonds maturing within 12 months)
Non- current Investments
Aggregate of quoted investments:
(i) Cost
(ii) Market Value
(iii) Book Value
Aggregate of unquoted investments:
(i) Cost
(ii) Book Value
Aggegrate of provision for diminution in value of investments
6,81,818 (2012: 6,81,818) shares of Rs. 110/- each 750 750
fully paid in SBI DFHI Ltd (formerly SBI Gilts Ltd)
(Percentage holding in the Company is 3.12%)
60,00,000 (2012: 10,00,000) shares of Rs. 10/- each 601 101
fully paid in SBI Pension Funds Pvt. Ltd
(Percentage holding in the Company is 20% (2012 : 5%))
1,351 851
6,56,25,000 (2012: 5,00,00,000) shares of Rs. 10/- each 7,500 5,000
fully paid in SBICAP Securities Ltd
2,00,000 (2012: 2,00,000) shares of GBP 1 (Rs.85.93) each 172 172
fully paid in SBICAP UK Ltd
10,00,000 (2012: 5,00,000) shares of Rs. 10/- each 5 5
fully paid in SBICAP Trustee Co. Ltd
(5,00,000 Bonus shares issued during the year (2012: 4,50,000))
41,62,000 (2012: 41,62,000) shares of Rs. 10/- each 416 416
fully paid in SBICAP Ventures Ltd
20,00,000 (2012: 3,00,000) shares of SGD 1 (Rs. 43.45) each 869 118
fully paid in SBICAP Singapore Ltd
8,962 5,711
Nil (2012 :2,500 ) 6.70% tax free bonds of India Railways Finance - 2,500
Corp. Ltd of Rs. 1,00,000/- each fully paid
- 2,500
28,28,854 (2012: 28,28,854) units of Rs. 10/- each 695 714
fully paid SBI Magnum Balanced Fund Dividend Payout
(At cost less provision other than temporary diminution in
value Rs. 305(2012: Rs.287))
35,39,410 (2012: 35,39,410) units of Rs. 10/- each 642 753
fully paid FT India Balance Fund Dividend Payout
(At cost less provision other than temporary diminution in
value Rs. 358(2012:Rs.247))
1,00,00,000 (2012: 1,00,00,000) units of Rs. 10/- each 881 1,000
fully paid SBI PSU Fund Growth
(At cost less provision other than temporary diminution in
value Rs. 119 (2012: Nil))
2,218 2,467
13,432 12,430
25,521 22,543
5,000 -
20,521 22,543
12,328 10,671
12,426 10,131
12,089 10,113
14,317 13,065
13,432 12,430
* Fully provided for. 1,123 1,194
As at 31st
March-12
As at 31st
March-13
ANNUAL REPORT046 12-13
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements forthe year ended 31st March 2013 (contd.)
NOTE - 2.9
LOANS AND ADVANCES
Security Deposits
Loans and advances to related parties
Advances recoverable in cash or in kind or for value to be received
Other loans and advances
Total
(Unsecured and considered good unless otherwise stated)
562 666 17 10
- - 16 19
Considered good 130 156 15 30
Considered doubtful - - - -
130 156 15 30
Less: Provision for doubtful advances - - - -
130 156 15 30
Advance tax and tax deducted at source [net of provision for income-tax Rs 81,665 (2012: Rs.68,565)] 4,977 5,732 - -
Advance tax FBT [net of provision for FBT Rs 184
(2012: Rs.184)] - - - -
Advance interest tax [net of provision for interest tax Rs 139
(2012: Rs 139)] 152 152 - -
Prepaid Expenses 3 2 86 64
Loans to Employees 1 2 24 20
Balances with statutory/Government authorities 36 35 180 9
5,861 6,745 338 152
As at 31st
March-12
As at 31st
March-12
As at 31st
March-13
As at 31st
March-13
Non-current current
ANNUAL REPORT 04712-13
SB
I C
APIT
AL
MA
RK
ETS L
IMIT
ED
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
NOTE - 2.10
Trade Receivables
Total
NOTE - 2.11
Other Assets
Unsecured, considered good unless stated otherwise
Debts outstanding for a period exceeding
six months from the date they
are due for payment 19 19 8,550 247
Other debts - - 16,783 12,771 19 19 25,333 13,018
Considered doubtful
Debts outstanding for a period exceeding
six months from the date they
are due for payment 121 121 541 136
Other debts - - - -
121 121 541 136
Less: Provision for doubtful debts 121 121 541 136
19 19 25,333 13,018
Non-current current
Unsecured, considered good unless stated otherwise
Non-current Bank Balances - 297 - -
Others
Interest accrued on fixed deposits - 9 626 1,013
Interest accrued on investments - - 257 186
Interest Accrued - Downselling - - 291 -
- 306 1,174 1,199
Non-current current
As at 31st
March-12
As at 31st
March-12
As at 31st
March-13
As at 31st
March-13
ANNUAL REPORT048 12-13
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
NOTE - 2.12
STOCK-IN-TRADE
Investment in Equity Instruments (quoted)
Sub-total
Stock in trade for Downselling (quoted)
Sub-total
Total quoted stock-in-trade
Investment in Equity Instruments (unquoted)
Sub-total
Preference Shares (unquoted)
Sub-total
Nil (2012: 14,849) shares of Rs.10/- each - 5
fully paid in GKB Opthalmics Ltd
(At cost less provision Rs. Nil (2012: Nil))
- 5
400 (2012:Nil) 8.87% Power Finance Corp. Ltd series FV Rs.10,00,000/- each 4,000 -
(At cost less provision for temporary diminution in value Rs. Nil(2012: Nil))
250 (2012:Nil) 10.38% Jindal Saw Ltd. 9 yrs series-1 Debentures of FV Rs.10,00,000/- each 2,500 -
(At cost less provision for temporary diminution in value Rs. Nil (2012: Nil))
250 (2012:Nil) 10.38% Jindal Saw Ltd. 9 yrs series-2 Debentures of FV Rs.10,00,000/- each 2,500 -
(At cost less provision for temporary diminution in value Rs. Nil (2012: Nil))
30(2012:Nil) 8.90% Power Finance Corp Bonds FV Rs.10,00,000/- each 300 -
(At cost less provision for temporary diminution in value Rs. Nil (2012: Nil))
30(2012:Nil) 8.90% Power Finance Corp Bonds FV Rs.10,00,000/- each 300 -
(At cost less provision for temporary diminution in value Rs. Nil (2012: Nil))
30(2012:Nil) 8.90% Power Finance Corp Bonds FV Rs.10,00,000/- each 300 -
(At cost less provision for temporary diminution in value Rs. Nil (2012: Nil))
10(2012:Nil) 8.80% Food Corp of India Bonds FV Rs.10,00,000/- each 100 -
(At cost less provision for temporary diminution in value Rs. Nil (2012: Nil))
350(2012:Nil) 9.70% Deepak Ferlilizers and Petrochemicals Corp Bonds FV Rs.10,00,000/- each 3,500 -
(At cost less provision for temporary diminution in value Rs. Nil (2012: Nil))
50(2012:Nil) 9.71% Deepak Ferlilizers and Petrochemicals Corp Bonds FV Rs.10,00,000/- each 500 -
(At cost less provision for temporary diminution in value Rs. Nil (2012: Nil))
550(2012:Nil) 8.85% Chennai Petrochemicals Corp Bonds FV Rs.10,00,000/- each 5,500 -
(At cost less provision for temporary diminution in value Rs. Nil (2012: Nil))
3 (2012:Nil) 7.41% India Infrastructure Finance Corp. Ltd series IV-C 20 year 30 -
Taxfree Bonds FV Rs. 10 lac each
(At cost less provision for temporary diminution in value Rs. Nil (2012: Nil))
19,530 -
19,530 5
15,400 (2012: 15,400) shares of Rs.10/- each fully *- *-
paid in Cremica Agro Foods Ltd
(At cost less provision for Rs. 3 (2012: 3))
- -
1,40,000 (2012: 1,40,000) 0.0001% shares of Rs.10/- each fully *- *-
paid in Pasupati Fabrics Ltd
(At cost less provision Rs. 14 (2012: 14))
- -
As at 31st
March-12
As at 31st
March-13
ANNUAL REPORT 04912-13
SB
I C
APIT
AL
MA
RK
ETS L
IMIT
ED
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements forthe year ended 31st March 2013 (contd.)
Mutual Funds (unquoted)
Sub-total
Total unquoted stock-in-trade
Total stock-in-trade
Aggregate of quoted stock-in-trade:
(i) Cost
(ii) Market/realisable value
(iii) Book Value
Aggregate of unquoted stock-in-trade:
(i) Cost
(iii) Book Value
Aggegrate provision for diminution in value of investments
Nil (2012: 19,20,891) Units of Birla Sunlife Fund -Cash Plan - 1,925
Institutional Premium Plan Daily Dividend
Nil (2012: 9,62,36,356) Units of Reliance Liquidity Fund - 9,628
Daily Dividend
Nil (2012: 1,88,15,731) Units of HDFC Cash Management Fund Savings Plan - 2,001
Daily Dividend
Nil (2012: 4,85,575) Units of Templeton India TMA Super IP Daily Dividend - 4,859
Reinvestment
- 18,413
- 18,413
19,530 18,418
19,530 5
19,666 4
19,530 5
17 18,430
- 18,413
17 17
* Fully provided for.
As at 31st
March-12
As at 31st
March-13
ANNUAL REPORT050 12-13
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
NOTE - 2.13
CASH AND BANK BALANCES
Cash and cash equivalents
Non-current current
On Current Accounts - - 414 1,363
Deposits with original maturity of less than three months - - 3,750 1,800
Cheques / drafts on hand - - 34 108
Cash on hand - -
Other Bank Balances
Deposits with original maturity of more than twelve months - 297 11,561 19,024
Deposits with original maturity of more than three months
but less than twelve months - - 1,014 396 Margin money deposit - - 1 20
Less : Amount disclosed under non-current assets - (297) - -
- - 16,774 22,711
Note :
Deposit accounts amounting to Rs.1 (2012 :Rs.20) are with scheduled banks towards the cash margin for various
guarantees issued by banks on behalf of the Company.
As at 31st
March-12
As at 31st
March-12
As at 31st
March-13
As at 31st
March-13
ANNUAL REPORT 05112-13
SB
I C
APIT
AL
MA
RK
ETS L
IMIT
ED
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
For The Year Ended
31st March-2013
For The Year Ended
31st March-2012
ANNUAL REPORT052 12-13
(Rupees in lacs unless otherwise stated)
NOTE - 2.14
REVENUE FROM OPERATIONS Merchant Banking and Advisory Fees
Sub-total
Other Operations (Income from Securities)
Sub-total
NOTE - 2.15
OTHER INCOME
NOTE - 2.16
EMPLOYEE BENEFIT EXPENSES
Issue management 1,298 904
Underwriting commission - 1
Arranger's fees 670 1,051
Advisory fees 47,156 41,810
49,124 43,766
Interest Income 1,636 698
Profit/(loss) on sale of investments (net) (84) (7)
Trading profits/(loss) on stock-in-trade (net) 96 (35)
Dividend 2,034 1,843
3,682 2,499
52,806 46,265
Profit on sale of fixed assets (net) 1 -
Rental income 305 305
Bad debts recovered 15 1
Foreign exchange fluctuation (net) - 14
Interest on deposit with Banks 1,772 2,270
Others 25 162
Write-back of provision on:
Investments - 7
Doubtful debts 53 57
2,171 2,816
Salaries, wages and bonus 6,671 6,827
Contribution to provident and pension funds 258 237
Contribution to Gratuity 117 140
Contribution to Superannuation 198 153
Compensated Absences 174 279
Staff welfare 168 137
7,586 7,773
Notes to Financial Statements forthe year ended 31st March 2013 (contd.)
NOTE - 2.17
INTEREST EXPENSE
NOTE - 2.18
OTHER EXPENSES
NOTE - 2.19
PROVISIONS (Expense)
Bank and others 1 -
1 -
Legal and professional fees 253 277
Conveyance and travelling 889 846
Rent 909 985
Rates and taxes 18 9
Royalty 590 505
Bad debts written off 203 233
Postage, telephone and telex 178 166
Advertisement 159 71
Printing and stationery 89 108
Electricity 138 107
Repairs and maintenance:
Building 69 99
Others 106 120
Insurance 70 68
Directors' sitting fees 6 2
Foreign exchange fluctuation, net 13 -
Loss on sale of fixed assets (net) - 10
Tax on perquisities 37 1
Office Maintenance 72 58
Training Charges 189 219
Membership and Subscription 208 118
Filing Fees and other Charges (Issues) 44 13
Miscellaneous expenses 300 210
4,540 4,225
Provision for:
Diminution in value of investments 273 229
Doubtful debts 458 128
731 357
For The Year Ended
31st March-2013
For The Year Ended
31st March-2012
ANNUAL REPORT 05312-13
SB
I C
APIT
AL
MA
RK
ETS L
IMIT
ED
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
For The Year Ended
31st March-2013
For The Year Ended
31st March-2012
NOTE - 2.20
Earnings per equity share (EPS)
II Nominal value per share (Rs.) 10 10
EPS has been calculated based on the net profit after taxation of Rs.29,600 (2012: Rs.25,098) and the weighted
average number of equity shares outstanding during the year of 5,803 (2012: 5,803).
Basic and diluted EPS has been computed by dividing net profit after tax by weighted average number of equity
shares outstanding during the year. There are no dilutive potential equity shares outstanding during the year.
As at 31st As at 31st
March-13 March-12
Tax Assets/(Liabilities) due to temporary timing difference in
respect of:
Depreciation on fixed assets 81 114
Provision on Gratuity 91 66
Provision on compensated leave 229 173
Provision for doubtful debts 215 84
Carryforward of Losses 682 -
1,298 437
Less : Opening Deferred Tax Asset 437 525
861 (88)
As at 31st As at 31st
March-13 March-12
(i) Claims against the Company not acknowledged as debts 443 845
(ii) Guarantees issued 1 20
(iii) Capital Commitments - 30
Based on the legal advice and favourable legal decisions by various authorities, no provision has been made in respect of
income tax demands aggregating to Rs.7,210 (2012: Rs.6,983) in excess of provision held. These demands have been
contested by the Company at various appellate authorities.
I Basic and diluted EPS (Rs.) 51.00 43.25
NOTE - 2.21
Deferred taxes
Deferred tax assets
Deferred tax assets
Deferred tax credit / (expense) for the year
NOTE - 2.22
CONTINGENT LIABILITIES AND COMMITMENTS
NOTE - 2.23
ANNUAL REPORT054 12-13
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements forthe year ended 31st March 2013 (contd.)
NOTE - 2.24
SUPPLEMENTARY PROFIT AND LOSS DATA
NOTE - 2.25
RELATED PARTIES
Name of the Party Relationship
Name of the Party Relationship
(a) Managerial remuneration
(i) The Managing Director & Chief Executive Officer is on secondment from SBI and their remuneration,
which is in accordance with the service rules of SBI, has been charged in the books of accounts.
(ii) Remuneration to Managing Director & CEO
Salary and bonus 24 21
Contribution to provident and pension funds 1 1
Perquisites 12 8
37 30
As the future liability for Gratuity and Compensated leave absences is provided on actuarial basis for the Company
as a whole, the amount pertaining to the directors is not ascertainable and therefore not included above.
There is no commission payable to any director of the Company. Consequently, the computation of profits as
required under Section 349 of the Companies Act, 1956 has not been included.
(b) Payments to auditors (excluding service tax) (included in Legal and professional fees)
As auditors 12 12
For tax audit 1 1
For other matters 5 5
For out-of-pocket expenses 1 1
19 19
(c) Expenditure in foreign currency
Travel and other expenses 362 310
(d) Earnings in foreign currency
Advisory fees from overseas clients and reimbursement
of expenses 1,957 200
The following is the list of parties related due to control criteria as per AS-18, Related Party Disclosure:
State Bank of India Holding Company
The following is the list of parties related due to significant influence criteria as per AS-18 with whom the transactions have taken place during the year:
State Bank of Bikaner & Jaipur Fellow Subsidiary
State Bank of Hyderabad Fellow Subsidiary
State Bank of Mysore Fellow Subsidiary
State Bank of Patiala Fellow Subsidiary
State Bank of Travancore Fellow Subsidiary
SBI DFHI Limited Fellow Subsidiary
SBI Funds Management Pvt. Limited Fellow Subsidiary
SBI Life Insurance Company Limited Fellow Subsidiary
SBI Global Factors Ltd. Fellow Subsidiary
SBI Pension Funds Pvt. Ltd Fellow Subsidiary
SBI General Insurance Co Ltd Fellow Subsidiary
SBICAP Securities Limited Subsidiary
SBICAPS Ventures Limited Subsidiary
SBICAP Trustee Company Limited Subsidiary
SBICAP (UK) Limited Subsidiary
SBICAP Singapore Ltd Subsidiary
Shri S.Vishvanathan, Managing Director & Chief Executive Key Management Personnel
Officer upto 16th August 2012
Smt. Arundhati bhattacharya, Managing Director Key Management Personnel
& Chief Executive Officer
FOR THE YEAR ENDED
31st March-2013
FOR THE YEAR ENDED
31st March-2012
ANNUAL REPORT 05512-13
SB
I C
APIT
AL
MA
RK
ETS L
IMIT
ED
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
Expenses during the year ended
Income during the year ended
Deputation of Employees* 268 219 - - - -
State Bank of Hyderabad
Interest Expenses 1 - - - - -
Rent 45 37 - - - -
Bank & Other Charges 3 3 - - - -
SBI DFHI Limited - - - - - -
SBICAP Securities Ltd. - - - - - -
Legal & Professional Charges - - - - - -
SBICAP Securities Ltd. - - 35 - - -
Royalty Expense 590 505 - - - -
Insurance Mediclaim - - - - - -
SBI Life Insurance Company Limited - - - - 10 11
SBI General Insurance Co Ltd - - - - - -
Office Maintenance 1 - - - - -
Filing Fees & Other Charges - - - - - -
SBICAP Securities Ltd. - - 8 - - -
Issue Management Fees 10 10 - - - -
SBICAP Securities Ltd. - - 8 14 - -
State Bank of Hyderabad - - - - 8 -
State Bank of Bikaner & Jaipur - - - - - 15
SBI Funds Management Pvt. Ltd. - - - - 15 -
Private Placement Fees 1 22 - - - -
SBICAP Securities Ltd. - - 98 277 - -
Advisory Fees 893 2,969 - - - -
SBICAP Securities Ltd. - - - 38 - -
SBI Global Factors Ltd - - - - 10 -
State Bank of Patiala - - - - 8 -
SBI Macquarie Infrastructure
Investment Pte Ltd - - - - - -
SBI Macquarie Infrastructure Trust - - - - - -
Bank Interest 618 686 - - - -
State Bank of Bikaner & Jaipur - - - - 195 159
State Bank of Patiala - - - - 134 186
State Bank of Travancore - - - - 332 413
Rent - - - - - -
SBI Funds Management Pvt. Ltd. - - - - 305 305
Dividend - - - - - -
SBI DFHI Limited - - - - 65 85
SBICAP Trustee Company Ltd. - - 10 5 - -
Miscellaneous Receipts - - - - - -
SBICAP Securities Ltd. - - - - - -
Profit & Loss on Sale of LTI - - - - - -
SBICAP Ventures Ltd - - - 21 - -
- - - - 6 10
Details of Transactions with the above related parties are as under :
ParticularsHolding Company
Mar-13 Mar-13
Subsidiaries Fellow Subsidiaries
Mar-12 Mar-12 Mar-13 Mar-12
Details of Transactions with the above related parties are as under :
ParticularsHolding Company
Mar-13 Mar-13
Subsidiaries Fellow Subsidiaries
Mar-12 Mar-12 Mar-13 Mar-12
ANNUAL REPORT056 12-13
(Rupees in lacs unless otherwise stated)
Balance receivable as at
Balance payable as at
Others transactions during
the year ended
Debtors 28 370 - - - -
State Bank of Hyderabad
SBICAP Securities Ltd. - - 119 347 - -
Cash at Bank 448 1,470 - - - -
Deposit with Bank 10,163 9,078 - - - -
State Bank of Bikaner & Jaipur - - - - 2,277 1,615
State Bank of Patiala - - - - 1,089 1,046
State Bank of Travancore - - - - 297 3,978
Loans & Advances 11 6 - - - -
SBICAP Securities Ltd. - - 1 1 - -
SBICAP Trustee Company Ltd. - - - - - -
SBICAP UK Ltd - - - 10 - -
SBICAP Singapore Ltd - - 4 1 - -
SBI Life Insurance Company Limited - - - - - -
Other Current Assets 184 301 - - - -
State Bank of Patiala - - - - 76 46
State Bank of Travancore - - - - 38 191
State Bank of Bikaner & Jaipur - - - - 152 202
Investments - - - - - -
SBI Pension Funds Pvt. Ltd - - - - 601 101
SBI DFHI Limited - - - - 750 750
SBICAP Securities Ltd. - - 7,500 5,000 - -
SBICAP Ventures Ltd - - 416 416 - -
SBICAP Trustee Company Ltd. - - 5 5 - -
SBICAP UK Ltd - - 172 172 - -
SBICAP Singapore Ltd - - 869 118 - -
Creditors 598 2,089 - - - -
SBICAP Securities Ltd. - - 546 997 - -
SBICAP UK Ltd - - 1 - - -
SBI Life Insurance Company Limited - - - - - -
Bank Overdraft - - - - - -
Dividend paid 15,089 11,607 - - - -
Fees Shared (netted from Income) - 11,982 - - - -
SBICAP Securities Ltd. - - 884 2,437 - -
SBI DFHI Limited - - - - - -
Expenses shared
SBICAP Securities Ltd. - - 2 - - -
Guarantees 1 20 - - - -
I. *Included in expenses relating to deputation of employees are amounts aggregating to Rs. 37 (2012: Rs. 30) pertaining to salaries paid to key management personnel.
- - - - 9 -
Details of Transactions with the above related parties are as under :
ParticularsHolding Company
Mar-13 Mar-13
Subsidiaries Fellow Subsidiaries Associates of SBI
Mar-12 Mar-12 Mar-13 Mar-12 Mar-13 Mar-12
Details of Transactions with the above related parties are as under :
ParticularsHolding Company
Mar-13 Mar-13
Subsidiaries Fellow Subsidiaries
Mar-12 Mar-12 Mar-13 Mar-12
Notes to Financial Statements forthe year ended 31st March 2013
ANNUAL REPORT 05712-13
SB
I C
APIT
AL
MA
RK
ETS L
IMIT
ED
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
Ext
ern
al sa
les
5
,45
2
4
,78
0
4
9,1
93
4
3,8
37
332
464
5
4,9
77
49,0
81
Inte
r-se
gm
en
t sa
les
--
--
--
--
5
,45
2
4
,78
0
4
9,1
93
4
3,8
37
332
464
5
4,9
77
49,0
81
Seg
men
t re
sult
5
,16
1
4
,52
0
4
2,1
25
3
7,2
28
332
464
4
7,6
17
4
2,2
12
Un
allo
cate
d R
eve
nu
e-
--
--
--
-
Un
allo
cate
d c
orp
ora
te e
xpen
ses
--
--
--
5,7
78
5,7
26
Op
era
tin
g p
rofi
t-
--
--
-
41,8
39
36,4
86
Inte
rest
exp
en
se-
--
--
--
-
Inco
me t
ax
--
--
--
1
2,2
39
1
1,3
88
Pro
fit
fro
m o
rdin
ary
act
ivit
ies
29,6
00
2
5,0
98
Ext
rao
rdin
ary
ite
m,
net
--
--
--
--
Net
pro
fit
--
--
--
2
9,6
00
2
5,0
98
Fu
nd
Base
d S
eg
men
t Fe
e B
ase
d S
eg
men
t
Co
rpo
rate
& O
thers
Co
nso
lidate
d
61
,93
3
2
5,5
63
1
3,0
63
-
-
84,3
90
7
4,9
96
--
--
--
1
2,4
92
1
1,6
87
--
--
--
9
6,8
82
8
6,6
83
--
--
--
7,1
10
7,0
08
--
--
--
7,7
00
9,5
64
--
--
--
2
16
385
--
--
--
2
80
240
Iden
tifi
cati
on
of
dir
ect
co
st t
o e
ach
seg
men
t, a
lloca
tio
n o
f co
mm
on
co
st a
nd
un
allo
cab
le c
ost
are
base
d o
n m
an
ag
em
en
t's
jud
gm
en
t.
REV
EN
UE
Tota
l re
ven
ue
RESU
LT
31
-Mar-
13
31
-Mar-
12
31
-Mar-
13
31
-Mar-
12
31-M
ar-
13
31-M
ar-
12
31-M
ar-
13
31-M
ar-
12
Seg
men
t ass
ets
58
,82
7
Un
allo
cate
d
corp
ora
te a
ssets
Tota
l ass
ets
Seg
men
t lia
bili
ties
88
58
22
,54
8-
-589
2,5
56
Un
allo
cate
d c
orp
ora
te lia
bili
ties
Tota
l lia
bili
ties
Cap
ital exp
en
dit
ure
s
Dep
reci
ati
on
As
at
Fun
d B
ase
d S
eg
men
tFe
e B
ase
d S
eg
men
tC
orp
ora
te &
Oth
ers
Co
nso
lid
ate
d
For
the y
ear
en
din
g3
1-M
ar-
13
31
-Mar-
12
31
-Mar-
13
31
-Mar-
12
31-M
ar-
13
31-M
ar-
12
31-M
ar-
13
31-M
ar-
12
NO
TE -
2.2
6
SEG
MEN
TAL
REPO
RTIN
G
ANNUAL REPORT058 12-13
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
NOTE - 2.27
Gratuity and other post-employment benefit plans: (AS 15 120(b))
Profit and Loss account
Net employee benefit expense (recognised in Employee Cost)
Balance sheet
Details of Provision for gratuity
Changes in the present value of the defined benefit obligation are as follows:
Closing defined benefit obligation
Changes in the fair value of plan assets are as follows:
The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service
gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is
funded with an insurance company in the form of a qualifying insurance policy.
The following tables summarise the components of net benefit expense recognised in the profit and loss account
and the funded status and amounts recognised in the balance sheet for the respective plans.
[AS15 Revised ( c) (i) to (x)]
Current service cost 77 61
Interest cost on benefit obligation 45 31
Expected return on plan assets (21) (18)
Net actuarial( gain) / loss recognised in the year 15 66
Past service cost - -
Net benefit expense 117 140
Actual return on plan assets 23 18
Defined benefit obligation 593 464
Fair value of plan assets (312) (260)
Less: Unrecognised past service cost - -
Plan asset / (liability) (281) (204)
[AS15 Revised 120(e) (i) to (viii)]
Opening defined benefit obligation 464 341
Interest cost 45 31
Current service cost 77 61
Benefits paid (11) (35)
Actuarial (gains) / losses on obligation 18 66
Past Service Cost - -
593 464
Opening fair value of plan assets 260 225
Expected return 21 18
Contributions by employer 39 51
Benefits paid (11) (35)
Actuarial gains / (losses) 3 1
Closing fair value of plan assets 312 260
The Company expects to contribute Rs.60 (2012-13: Rs. 60) to gratuity in 2013-14.
Gratuity
20122013
Gratuity
20122013
Gratuity
20122013
Gratuity
20122013
ANNUAL REPORT 05912-13
SB
I C
APIT
AL
MA
RK
ETS L
IMIT
ED
(Rupees in lacs unless otherwise stated)
20122013
The major categories of plan assets as a percentage of the fair value of total plan assets are as
follows:
The principal assumptions used in determining gratuity for the Company’s plans are shown below:
Amounts for the current and previous period are as follows:
[AS15 Revised Para (h)]
% %
Investments with insurer 100 100
{AS15 Revised 120 (l) (i) to (v)}
% %
Discount rate 8.20 8.20
Expected rate of return on assets 7.50 7.50
Employee turnover Age (Years) 21-44 8% 8%
Age (Years) 45-57 3% 3%
Healthcare cost increase rate N.A. N.A.
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority,
promotion and other relevant factors, such as supply and demand in the employment market.
[AS15 Revised 120(n)]
Defined benefit obligation 593 464
Plan assets 312 260
Surplus / (deficit) (281) (204)
Experience adjustments on plan liabilities (6) 2
Experience adjustments on plan assets 3 1
Gratuity20122013
Gratuity
20122013
Gratuity
20122013
Notes to Financial Statements forthe year ended 31st March 2013 (contd.)
ANNUAL REPORT060 12-13
(Rupees in lacs unless otherwise stated)
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
NOTE - 2.28
Details of transactions under Stock-in-Trade during the period 1st April, 2012 to 31st March, 2013 (Figures relating to financial year 2011-12 are indicated in bracket)
Pre
fere
nce
Sh
are
s
1
40
,00
0
*--
--
--
-140,0
00
*-
(14
0,0
00
)
*-
(-
)
(-)
(-)
(-)
(-)
(-)
(140,0
00)
*-
Eq
uit
y Sh
are
s
3
0,3
49
5
--
-
-
1
4,8
49
5
15,5
00
-
(1,5
97
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0)
(5
) (
-)
(-)
(
-)
(-)
(1,5
66,9
61)
(192)
(30,3
49)
(5)
Un
its
of
Mu
tual Fu
nd
1
17,4
58,5
53
1
8,4
13
3
77
,28
4,4
14
1
72
,79
9
(31
,44
4,7
58
)-
4
63,2
98,2
10
191,2
13
0
.00
(77
,18
0,9
04
) (
8,5
20
) (4
67
,59
4,0
18
) (
92
,08
0)
(-6
7545397.7
69)
-
(359,7
70,9
71)
(
82,1
86)
(
117,4
58,5
53)
(18,4
13)
Sto
ck in
Tra
de f
or
Do
wn
selli
ng
--
92
0,8
22
1
25
,92
0-
-
9
18,9
29
106,4
82
1,8
93
19,5
30
(
-)
(-)
(2,1
53
) (2
6,6
36
)(-
) (-
)
(2,1
53)
(
26,5
89)
(-)
(-)
Co
mm
erc
ial Pap
er
--
5
00
2
,44
9-
-
500
2,4
49
--
18
,41
83
01
,16
8
300,1
49
19,5
30
(
8,5
25
) (
92
,08
0)
(82,3
78)
(18,4
18)
Sto
ck-I
n-T
rad
e
Tota
l
Op
en
ing
Sto
ckA
dd
itio
nal Pu
rch
ase
sA
dju
stm
en
ts**
Clo
sin
g S
tock
Sale
s/Red
em
pti
on
No
s.A
mt.
No
s.A
mt.
No
s.A
mt.
No
s.A
mt.
No
s.A
mt.
* Fu
ll p
rovi
ded
fo
r **
Ad
just
men
t sh
ow
n is
on
acc
ou
nt
of
chan
ge in
F.V
of
un
its
of
Mu
tual Fu
nd
Part
icu
lars
ANNUAL REPORT 06112-13
SB
I C
APIT
AL
MA
RK
ETS L
IMIT
ED
(Rupees in lacs unless otherwise stated)
NOTE - 2.29
NOTE - 2.30
NOTE - 2.31
NOTE - 2.32
PRIOR YEAR COMPARATIVES
Based on information available with the Company, there are no suppliers who are registered as micro, small or medium
enterprise under "The Micro, Small and Medium Enterprise Development Act, 2006" as at March 31, 2013
The Company has cheques in hand aggregating Rs. 34 (2012: Rs. 108), which have been included in the respective bank
accounts.
Office premises obtained on operating lease are cancellable and no restrictions are imposed by the lease agreement,
hence no disclosure is required. Lease rent paid during the year is disclosed in Note 2.18 to the Financial Statements.
The financial statements for the year have been presented as per the Revised Schedule VI. The figures of the previous
year have been regrouped/reclassified as appropriate, to correspond with those of the current year.
Notes to Financial Statements forthe year ended 31st March 2013 (contd.)
ANNUAL REPORT062 12-13
(Rupees in lacs unless otherwise stated)
As per our report of even date
For SUDIT K PAREKH & CO. For and on behalf of Board of DirectorsFirm Registration No. 110512WChartered Accountants
Durgaprasad Khatri Pratip Chaudhuri Arundhati Bhattacharya Nilesh N. Shah
Partner Chairman Managing Director & CEO Company Secretary
Membership No.: 16316
Mumbai
April 26, 2013
Notes to Financial Statements forthe year ended 31st March 2013 (contd.)
Statement Pursuant to Section 212 of the Companies Act, 1956, relating to Subsidiary Companies
SB
ICA
P
Sin
gap
ore
Ltd
.
GB
PSin
gap
ore
Do
llars
1.
Th
e f
inan
cial ye
ar
of
the S
ub
sid
iary
Co
mp
an
y en
ded
on
Marc
h 3
1, 2
01
3M
arc
h 3
1, 2
01
3M
arc
h 3
1,
2013
Marc
h 3
1,
2013
Marc
h 3
1,
2013
(a)
Nu
mb
er
of
Eq
uit
y Sh
are
s h
eld
by
SB
I C
ap
ital M
ark
ets
6,5
6,2
5,0
00
Eq
uit
y 4
1,6
2,0
00
Eq
uit
y10,0
0,0
00 E
qu
ity
200,0
00 O
rdin
ary
20,0
0,0
00 O
rdin
ary
Lim
ited
an
d/o
r it
s n
om
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in t
he S
ub
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as
on
Sh
are
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f Rs.
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/-Sh
are
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f Rs.
10
/-Sh
are
s o
f Rs.
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Sh
are
s o
f G
BP 1
/-
Sh
are
s o
f Sin
gap
ore
Marc
h 3
1,
2013
each
Fu
lly P
aid
-up
each
Fu
lly P
aid
-up
each
Fu
lly P
aid
-up
each
Fu
lly P
aid
-up
Do
llars
1/-
each
Fully
Paid
-up
(b)
Ext
en
t o
f in
tere
st o
f S
BI C
ap
ital M
ark
ets
Lim
ited
in
1
00
%1
00
%100%
100%
100%
the C
ap
ital o
f th
e S
ub
sid
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2.
Net
ag
gre
gate
am
ou
nt
of
Pro
fits
/Lo
sses
of
the S
ub
sid
iary
so
far
as
it c
on
cern
s th
e M
em
bers
of
SB
I C
ap
ital M
ark
ets
Lim
ited
an
d is
no
t d
ealt
wit
h in
th
e A
cco
un
ts o
f
SB
I C
ap
ital M
ark
ets
Lim
ited
(a)
Pro
fits
of
the S
ub
sid
iary
fo
rth
e f
inan
cial ye
ar
en
ded
on
2
42
3
5
752
1,1
64,3
37
(691,1
99)
Marc
h 3
1,
2013
(b)
Pro
fits
fo
r th
e p
revi
ou
s fi
nan
cial ye
ars
of
the S
ub
sid
iary
2
,89
9
23
1,0
86
1,2
62,1
29
(2
49,1
49)
sin
ce it
beca
me S
ub
sid
iary
of
SB
I C
ap
ital M
ark
ets
Lim
ited
3.
Net
ag
gre
gate
am
ou
nt
of
Pro
fits
/Lo
sses
of
the S
ub
sid
iary
so f
ar
as
dealt
wit
h o
r p
rovi
sio
ns
mad
e f
or
tho
se lo
sses
in
the A
cco
un
ts o
f SB
I C
ap
ital M
ark
ets
Lim
ited
(a)
Pro
fits
of
the S
ub
sid
iary
fo
r th
e f
inan
cial ye
ar
en
ded
on
Marc
h 3
1,
2013
--
--
-
(b)
Pro
fits
fo
r th
e p
revi
ou
s fi
nan
cial ye
ars
of
the S
ub
sid
iary
sin
ce it
beca
me S
ub
sid
iary
of
SB
I C
ap
ital M
ark
ets
Lim
ited
--
--
-
Sr.
No
.N
am
e o
f th
e S
ub
sid
iary
Co
mp
an
y
SB
ICA
P
Secu
riti
es
Ltd
.SB
ICA
P
Ven
ture
s Lt
d.
SB
ICA
P T
rust
ee
Co
mp
an
yLt
d.
SB
ICA
P U
K L
td.
For
an
d o
n b
eh
alf
of
Bo
ard
of
Dir
ect
ors
Pra
tip
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6,
2013
ANNUAL REPORT 06312-13
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(Rupees in lacs unless otherwise stated)
SBICAP SECURITIES LIMITED
ANNUAL REPORT064 12-13
DIRECTORS' REPORT FOR THE YEAR 2012-13
To,
The Members,
Your Directors have pleasure in presenting the 8th Annual Report together with the Profit and Loss Account for the year
ended 31st March 2013 and the Balance Sheet as on that date.
Performance Highlights (Rs. in Crs.)
Year ended March 31 2012 2013
Gross Income 87.24 69.60
Profit before provisions, Depreciation, Interest and Tax 8.27 5.66
Provisions 0.45 0.31
Depreciation 1.67 1.41
Interest - -
Profit/(Loss)before tax 6.15 3.69
Profit/(Loss)after tax 4.03 2.42
Equity Share Capital 50.00 65.63
Reserves 29.29 41.09
Debt Funds - -
Earnings per share (Rs.) 0.81 0.38
Return on Equity (%) 5.08 2.27
Dividend per share (Rs.) - -
Book Value per share (Rs.) 15.86 16.26
Operating Results
Financial Position
Other Selected Data
I. Market Environment:
II. Operations:
The Market sentiments across the globe swung widely during the year from high levels of optimism to deepening despair
over still faltering economic activity. The first six months of the financial saw depressed market sentiments and poor flows
in the equity markets. The sentiments improved after September on the back of unprecedented monetary stimuli by
central banks of advanced economies and relative success of the European Union in containing the euro zone debt crisis.
In India also, the slew of reforms initiated by the government in the II half of the year lifted the overall sentiments and the
broader indices, Nifty and Sensex hit a two years high of 6101.30 & 20203.66 on 22nd January 2013 & 29th Jan 2013
respectively. However, inflation, deteriorating Rupee, widening fiscal & current account deficits and concerns of
decelerating growth amid political uncertainty kept gains in check. The Retail investor by and large kept away from the
equity markets.
The Sensex settled to close at 18835.77 while the NIFTY closed the year at 5682.55 giving a 8.23 and 7.31 percent return
respectively for the whole year. Among sectoral indices, FMCG and Healthcare were the better performers whereas Metal,
Power and Capital goods were the worst affected. Midcap index underperformed the broader indices due to corporate
governance issues, heavy selling by FII and declining corporate earnings. CNX midcap index declined by 4.01% to close at
7401.60 at the end of the year.
DII cash market volumes, from where your company sources most of its broking business were flat during the year and the
Retail investor stayed away from the markets for the better part of the year.
As you are aware, your Company is committed to a high growth path and has invested substantially in teams and
technology in the current year. On the Institutional business side, it has ramped up its sales and research teams and set up
an exclusive FII desk to cater to institutional investors. Your Company's research now covers all key sectors and most NIFTY
stocks. A new Debt Market vertical has also been set up during the year which has broken even in a very short time span.
Even though markets seem to have been in the green for the better part of the year, retail investors' participation in the
equity cash market was at a seven-year low, with more and more savings finding their way in to real estate, gold, bank
deposits and high-yielding debt instruments.
New products and enhanced client servicing through advisory and call centre interaction have helped your Company
deepen client relationships and despite a very difficult year with a decline of about 24% in the overall retail volumes, your
company was able to hold its retail top line.
ANNUAL REPORT 06512-13
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DIRECTORS' REPORT (contd.)
III. Financial Results:
IV. Dividend:
V. Personnel:
VI. Deposits:
VII. Directors:
Sales and Distribution income which in the previous year contributed to about 46% of the gross revenues of your
company, was impacted by the muted investor interest in the Tax Free Bonds, leading to a reduced top line for the
company. Gross Income of your company stood at Rs.69.60 crores during the year under review, while the PBT and PAT
were at Rs.3.69 crores and Rs.2.42 crores respectively. Income from broking activity contributed Rs. 43.20 crores, Sales
and Distribution Rs. 17.61 crores and the balance Rs.8.79 crores came from interest, depository services fees and other
income. The corresponding figures last year were Rs.40.48 crores, Rs.39.98 crores and Rs.6.78 crores respectively.
The Company has made significant investments in team building, technology and branch expansion this year which has
lowered PAT but enhanced wherewithal for future growth.
No dividend is proposed, for the year 2012-13, with a view to conserving resources.
The company continues to lay great stress on human resources as the most valuable asset. As on 31st March 2013, the
strength of its workforce was 555 as compared to 519 as at the previous year's close and teams in various verticals have
been enhanced both quantitatively and qualitatively. Continuous learning and skill up-gradation is ensured through
interventions like induction and orientation programmes as also external training programmes particularly in the area of
soft skills.
The Company has not accepted any deposits from the Public, during the period under review.
During the year under review, the following changes took place in the Board of Directors of the Company:-
1) Shri A. Krishna Kumar, Managing Director & GE (National Banking Group), State Bank of India was appointed as
Nominee Director of the Company w.e.f. 26th July, 2012.
2) Shri S. Vishvanathan resigned as Director & Chairman of the Company w.e.f. 17th August, 2012 consequent upon his
transfer to State Bank of India as Dy. Managing Director (On Special Duty).
3) Smt. Swati B. Desai was re-appointed as Managing Director of the Company w.e.f. 20th August, 2012.
4) Smt. Arundhati Bhattacharya, Managing Director & CEO, SBI Capital Markets Limited was appointed as Director &
Chairperson of the Company w.e.f. 12th September, 2012.
5) Shri H. N. Varma was appointed as Additional Director of the Company w.e.f. 26th September, 2012.
6) Shri Shyamal Acharya, Dy. Managing Director & GE (Associates & Subsidiaries), State Bank of India resigned as
Nominee Director of the Company w.e.f. 29th November, 2012 consequent to the appointment of Shri
S.Vishvanathan as Managing Director & GE (Associates & Subsidiaries), State Bank of India w.e.f. 26th November,
2012.
7) Shri Rajeev Krishnan resigned as Director of the Company w.e.f. 15th December, 2012 consequent upon transfer to
State Bank of India as Chief General Manager (Stressed Assets Management II).
8) Shri Anil Bhandari was re-appointed as Whole-time Director of the Company w.e.f. 24th December, 2012.
9) Shri S. Vishvanathan Managing Director & GE (Associates & Subsidiaries), State Bank of India was appointed as
Nominee Director of the Company w.e.f. 28th December, 2012.
10) Shri V.G. Kannan, President & COO, SBI Capital Markets Ltd was appointed as Additional Director of the Company
w.e.f. 21st January, 2013.
In accordance with the provisions of the Companies Act, 1956 Shri H.N. Varma and Shri V.G. Kannan, Directors hold office
up to the date of the 8th Annual General Meeting. The Company has received Notice from a member under section
257 of the Companies Act, 1956, proposing them as a candidate for the office of Director liable to retire by rotation.
Shri H.N. Varma and Shri V.G. Kannan have conveyed their consent for being appointed as Director liable to retire
by rotation.
Shri M.P. Mehrotra Director retires by rotation at the 8th Annual General Meeting of the Company and being eligible,
offers himself for re-appointment.
The Board extended a hearty welcome to Shri A. Krishna Kumar, Shri S. Vishvanathan Smt. Arundhati Bhattacharya,
Shri H.N. Varma, and Shri V.G. Kannan to the Board and placed on record its deep appreciation to Shri S.Vishvanathan,
Shri Shyamal Acharya and Shri Rajeev Krishnan for their valuable contributions during their tenure as Directors of the
Company.
ANNUAL REPORT066 12-13
VIII. Directors' Responsibility Statement:
IX. Auditors:
X. Companies (Disclosures of Particulars in the Report of the Board of Directors) Rules, 1988:
XI. Particulars of Employees:
XII. Acknowledgement:
Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Directors confirm that: -
i. in the preparation of the annual accounts, the applicable accounting standards have been followed;
ii. appropriate accounting policies have been selected and applied consistently, and the judgments and estimates that
have been made are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as st ston 31 March 2013 and of the profit or loss of the company for the period ended 31 March 2013;
iii. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with
the provisions of the Companies Act for safeguarding the assets of the company and for preventing and detecting
frauds and other irregularities;
iv. the annual accounts have been prepared on a going concern basis.
The Directors also wish to draw the kind attention of the Shareholders to the report of the Auditors to the Shareholders
issued by M/s. Sudit K. Parekh & Co. the Statutory Auditors, on the financial accounts for the year ended March 31, 2013.
M/s Sudit K. Parekh & Co., Chartered Accountants, the Statutory Auditors of the Company, retire at the conclusion of the
Eighth Annual General Meeting of the Company. th thThe Board of Directors at their 35 Meeting held on 15 April, 2013, has recommended the reappointment of M/s Sudit K.
Parekh & Co. Chartered Accountants, as the Statutory Auditors of the Company to hold office from the conclusion of the
Eighth Annual General Meeting up to the conclusion of the Ninth Annual General Meeting of the Company. The
Company has received a Certificate from M/s Sudit K. Parekh & Co. to the effect that their appointment, if made, would be
within the limits prescribed under Section 224(1B) of the Companies Act, 1956.
In terms of the above Rules issued by the Central Government, the following information is furnished:-
Conservation of Energy and Technology Absorption:
As the Company is engaged only in the business of stock broking activities and other financial services during the period
under review, there is no information to report under this head.
Foreign Exchange Earnings and Outgo:
During the year under review, the company had foreign exchange earnings of Rs.0.48 lac on account of research income.
The total foreign exchange expended amounted to Rs.16.08 lacs on account of software for transmission of messages
and foreign travel.
There is no employee in the Company whose particulars are required to be given under section 217(2A) of the Companies
Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended.
The Board of Directors would like to express its thanks to SEBI, the Company's Regulator, the National Stock Exchange of
India Limited and Bombay Stock Exchange Limited, Central Depository Services (India) Limited for their advice and
guidance received.
The Board is grateful to the State Bank of India and the SBICAPS family for their invaluable support and guidance to the
company. The Board also records its appreciation of the unstinted support extended by all its staff members.
For and on behalf of the Board of Directors
Arundhati Bhattacharya
Chairperson thDate: 15 April, 2013
DIRECTORS' REPORT (contd.)
ANNUAL REPORT 06712-13
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To the Members of SBICAP Securities Limited
We have audited the accompanying financial statements of SBICAP Securities Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2013 and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.
Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (“the Act”). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2013;
(b) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.
1. As required by the Companies (Auditor's Report) Order, 2003 as amended by Companies (Auditor's Report) (Amendment) Order, 2004 (together 'the Order'), issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
a. we have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit;
b. in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;
c. the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this Report are in agreement with the books of account;
d. in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956;
e. on the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;
For SUDIT K PAREKH & CO.
Chartered Accountants
Firm Registration No.: 110512W
(D.S. Khatri)PartnerMembership Number: 16306 Mumbai, dated: April 15, 2013
Report on the Financial Statements
Management's Responsibility for the Financial Statements
Auditor's Responsibility
Opinion
Report on Other Legal and Regulatory Requirements
INDEPENDENT AUDITOR'S REPORT
ANNUAL REPORT068 12-13
(Referred to in paragraph 1 under the heading “Report on other legal and regulatory requirements” of our report of even
date)
i. In respect of its fixed assets :
a. The Company has maintained proper records showing full particulars, including quantitative details and
situation of fixed assets.
b. Fixed assets have been physically verified by the management during the year. The frequency of verification is
reasonable with regards to size of the Company and the nature of its business and fixed assets. According to
information and explanation given to us, no material discrepancies were noticed on such verification.
c. Fixed assets disposed off during the year were not substantial and, therefore, do not affect the going concern
assumption.
ii. The Company is primarily in brokerage industry and it was not holding any inventory during the year. Hence, sub-
clauses (a) to (c) of clause (ii) are not applicable to the company.
iii. According to the information and explanations given to us, the Company has not granted/taken any loan secured or
unsecured to/from the company, firm or other parties covered in the register maintained under section 301 of the
Companies Act, 1956. Hence sub-clauses (a) to (g) of clause (iii) are not applicable to the Company.
iv. In our opinion and according to the information and explanations given to us, there exists adequate internal control
system commensurate with the size of the Company and the nature of its business with regard to purchases of fixed
assets and with regard to the sale of services. During the course of our audit, we have not observed any continuing
failure to correct major weaknesses in internal control system of the Company in respect of these areas.
v. According to the information and explanations given to us, there are no contracts and arrangements that needs to
be entered in the register to be maintained in pursuance of Section 301 of the Companies Act, 1956. Hence, sub-
clauses (a) and (b) of clause (v) is not applicable to the Company.
vi. According to the information and explanations given to us, the Company has not accepted any deposits from the
public within the meaning of provisions of sections 58A and 58AA and other relevant provisions of the Companies
Act, 1956 and the Companies (Acceptance of Deposit) Rules, 1975 made there under.
vii. The Company has an internal audit system commensurate with its size and the nature of its business.
viii. In our opinion, the central government has not prescribed the maintenance of the cost records under section 209(1)
(d) of the Companies Act, 1956 for the Company and hence this clause is not applicable to the Company.
a. According to the information and explanations given to us, the Company is generally regular in depositing
undisputed statutory dues in respect of Income tax, Service Tax, Provident Fund, cess and other statutory dues
as applicable to it with appropriate authorities.
As informed to us, the provisions of Investor Education and Protection Fund, Sales tax, Wealth tax, Excise duty
and customs duty are currently not applicable to the Company.
According to the information and explanations given to us, there are no undisputed amounts payable in
respect of Income tax, Service Tax, Provident Fund, cess and other statutory dues as applicable to it, that were
in arrears, as at March 31, 2013 for a period of more than six months from the date they became payable.
As informed to us, the provisions of Investor Education and Protection Fund, Sales tax, Wealth tax, Excise duty
and customs duty are currently not applicable to the Company.
b. According to the information and explanations given to us, there are no dues of Income tax, Service Tax,
Provident Fund, cess and other statutory dues as applicable to the company, which have not been deposited on
account of any dispute.
c. As informed, the provisions of Investor Education and Protection Fund, Sales tax, Wealth tax, Excise duty and
customs duty are currently not applicable to the Company.
x. The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses
in the financial year and in the immediately preceding financial year.
xi. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion
Re: SBICAP Securities Limited
ix. In respect of Statutory Dues:
ANNEXURE TO THE AUDITORS' REPORT
ANNUAL REPORT 06912-13
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that the Company has not defaulted in repayment of dues to banks. The company does not have any outstanding
dues to financial institutions nor does it have any debentures outstanding during the financial year.
xii. According to the information and explanations given to us, the Company has not granted loans and advances on
the basis of security by way of pledge of shares, debentures and other securities.
xiii. The provisions of chit fund are not applicable to the Company, hence clause xiii is not applicable to the Company.
xiv. According to the information and explanations given to us, the Company is not dealing or trading in shares,
securities, debentures and other investments. Therefore the provisions of this clause are not applicable to the
Company.
xv. In our opinion and according to information and explanations provided to us, the Company has not provided
guarantees for loans taken by others from banks and financial institutions.
xvi. The Company has not taken any term loans during the year and hence clause (xvi) is not applicable to the Company.
xvii. According to the information and explanations given to us, and on an overall examination of the Balance Sheet of
the Company, funds raised on short-term basis have not been used during the year for making long-term
investments.
xviii. According to the information and explanations given to us, during the year the Company has not made any
preferential allotment of shares to parties and Companies covered in the Register maintained under Section 301 of
the Companies Act, 1956.
xix. According to the information and explanation given to us, the company has not raised any money by way of issue of
debentures and hence clause xix is not applicable to the Company.
xx. The Company has not made any public issue of securities during the year.
xxi. According to the information and explanations given to us, no fraud on or by the Company was noticed or reported
during the year.
For SUDIT K PAREKH & CO.
Chartered Accountants
Firm Registration No.: 110512W
(D.S. Khatri)
Partner
Membership Number: 16306
Mumbai,
Dated: April 15, 201
ANNEXURE TO THE AUDITORS' REPORT (contd.)
ANNUAL REPORT070 12-13
Balance Sheet as at March 31, 2013
Notes March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Share capital 3 656,250,000 500,000,000
Reserves and surplus 4 410,917,602 292,919,657
1,067,167,602 792,919,657
Long term borrowings 5 1,451,812 1,246,452
Other long term liabilities 5 2,099,875 2,199,875
Long-term provisions 6 8,708,673 5,735,001
12,260,360 9,181,328
Trade payables 7 569,991,968 401,270,831
Other current liabilities 7 74,182,336 64,079,428
Short-term provisions 6 4,237,883 3,727,378
648,412,187 469,077,637
1,727,840,149 1,271,178,622
Fixed assets
Tangible assets 8 18,932,536 23,536,376
Intangible assets 9 8,975,780 7,040,434
Capital work-in-progress 194,200,420 149,041,446
Intangible assets under development 125,234,994 114,626,972
Deferred tax assets (net) 10 9,101,829 6,814,163
Long term loans and advances 11 128,033,790 120,000,159
Other non-current assets 12.2 - 1,211,732
484,479,349 422,271,282
Trade receivables 12.1 521,458,054 275,840,948
Cash and bank balances 13 710,032,356 565,319,021
Short term loans and advances 11 11,870,390 7,747,371
1,243,360,800 848,907,340
1,727,840,149 1,271,178,622
Summary of significant accounting policies 2.1
The accompanying notes are an integral part of the financial statements.
As per our report of even date
For Sudit K Parekh & Co. For and on behalf of the Board of Directors of
Firm Registration No.: 110512W SBICAP Securities Limited
Chartered Accountants
D.S. Khatri Arundhati Bhattacharya Swati B. Desai Dhanashri Kenkre
Partner Chairperson Managing Director Company Secretary
Membership No. : 16316
Mumbai
Date: April 15, 2013
EQUITY AND LIABILITIES
Shareholders' funds
Non-current liabilities
Current liabilities
TOTAL
ASSETS
Non-current assets
Current assets
TOTAL
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Statement of Profit and Loss
for the year ended March 31, 2013
Notes March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Brokerage 432,002,666 404,786,351
Selling and distribution 14.1 176,159,744 399,895,966
Depository services income 14.2 26,633,621 11,254,931
Other operating income 14.3 22,167,110 13,532,052
656,963,141 829,469,300
Other non-operating income 15 39,078,446 42,909,730
696,041,587 872,379,030
Employee benefit expenses 16 240,798,150 222,519,538
Operating expenses 17 206,653,272 412,697,250
Administration expenses 18 190,666,580 156,513,932
Depreciation and amortization expense 19 14,096,328 16,688,786
Finance costs 20 4,346,970 2,455,274
656,561,300 810,874,780
39,480,287 61,504,250
Add/Less: Prior period income/(expenses) 32 (2,520,009) (2,140,381)
36,960,278 59,363,869
Current tax 15,000,000 21,300,000
Deferred tax (2,287,667) (2,262,962)
12,712,333 19,037,038
24,247,945 40,326,831
Earnings per equity share [Nominal value of
share Rs.10 (Previous year Rs.10)]
(Basic and diluted EPS computed on the basis of
total profit for the year) 21 0.38 0.76
Summary of significant accounting policies 2.1
The accompanying notes are an integral part of the financial statements.
As per our report of even date
For Sudit K Parekh & Co. For and on behalf of the Board of Directors of
Firm Registration No.: 110512W SBICAP Securities Limited
Chartered Accountants
D.S. Khatri Arundhati Bhattacharya Swati B. Desai Dhanashri Kenkre
Partner Chairperson Managing Director Company Secretary
Membership No. : 16316
Mumbai
Date: April 15, 2013
Revenue from operations
Total Revenue from operations
Total Revenue
Expenses
Total expense
Profit before prior period adjustments
Profit before tax
Tax expenses
Total tax expense
Profit for the year from continuing operations
ANNUAL REPORT072 12-13
Cash flow statement
for the year ended March 31, 2013
ANNUAL REPORT 07312-13
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March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Profit before tax after prior period expenses 36,960,278 59,363,869
Non-cash adjustments
Depreciation and amortization 14,096,328 16,928,312
Provision for performance linked variable payments (PLVP) 14,000,000 19,282,047
Excess provision for PLVP written back (2,020,179) (4,377,864)
Excess provision for selling and distribution written back (5,345,587) (7,438,227)
Provision for doubtful debts 3,059,999 4,485,081
Loss on sale of fixed assets 359,836 615,244
Profit on sale of investment - (1,196,065)
Provision for leave encashment / gratuity 3,484,177 1,232,947
64,594,852 88,895,343
Movements in working capital:
Increase/(decrease) in current trade payables 169,067,984 (23,807,918)
Increase/(decrease) in non-current trade payables (346,846) 346,846
Increase/(decrease) in other current liabilities 3,468,674 1,650,569
Increase/(decrease) in other long term liabilities 105,360 (1,235,098)
Decrease/(increase) in non-current trade receivables (3,059,999) (5,048,162)
Decrease/(increase) in current trade receivables (245,617,105) 41,544,129
Decrease/(increase) in margin and other deposits (48,960,016) 193,500,000
Decrease/(increase) in inventories - 11,219,400
Decrease/(increase) in long term loans and advances (6,514,081) 1,631,969
Decrease/(increase) in short term loans and advances (4,123,020) 533,178
Decrease/(increase) in other current assets 2,850,816
Decrease/(increase) in other non-current assets 1,211,732 9,319,610
(70,172,466) 321,400,681
Direct tax refund received 2,495,343 -
Direct taxes paid (19,014,893) (44,111,754)
(86,692,016) 277,288,926
Sale of current investments - 11,196,065
Purchase of fixed assets (12,299,616) (10,022,259)
Sale of fixed assets 511,944 343,939
Movement in capital work-in-progress and intangible assets
under development (55,766,994) (237,861,802)
(67,554,666) (236,344,058)
Proceeds from issue of shares 250,000,000 -
250,000,000 -
95,753,318 40,944,868
Cash & cash equivalents at the beginning of the year 326,457,560 285,512,692
Cash & cash equivalents at the end of the year 422,210,878 326,457,560
Cash flow from operating activities :-
Operating profit before working capital changes
Cash generated from operations before tax
I. Net cash generated from operating activities
Cash Flow from investing activities :-
II. Net cash used in investing activities.
Cash Flow from financing activities :-
III. Net cash provided by financing activities
Net change in cash & cash equivalents (I+II+III)
Cash flow statement
for the year ended March 31, 2013 (contd.)
March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Balance with banks :
On current accounts 422,198,878 316,457,560
Deposits with original maturity less than 3 months - 10,000,000
Cash on hand 12,002 -
422,210,878 326,457,560
Summary of significant accounting policies 2.1
As per our report of even date
For Sudit K Parekh & Co. For and on behalf of the Board of Directors of
Firm Registration No.: 110512W SBICAP Securities Limited
Chartered Accountants
D.S. Khatri Arundhati Bhattacharya Swati B. Desai Dhanashri Kenkre
Partner Chairperson Managing Director Company Secretary
Membership No. : 16316
Mumbai
Date: April 15, 2013
Components of cash and cash equivalents
Total cash and cash equivalents (Note 13)
ANNUAL REPORT074 12-13
Summary of significant accounting policies for the year ended March 31, 2013
SBICAP Securities Ltd ('the Company') is a wholly-owned subsidiary of SBI Capital Markets Ltd., incorporated in 2005. It is
a member of the two premier stock exchanges of India, the National Stock Exchange of India Ltd and Bombay Stock
Exchange Ltd. The Company is engaged in the business of broking (retail and institutional) and third party distribution of
financial products.
The financial statements of the Company have been prepared in accordance with generally accepted accounting
principles in India ('Indian GAAP'). The Company has prepared these financial statements to comply in all material
respects with the accounting standards notified under the Companies (Accounting Standards)Rules, 2006, (as amended)
and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis
and under the historical cost convention. The accounting policies adopted in the preparation of financial statements are
consistent with those of previous year.
a. Use of estimates
"The preparation of financial statements in conformity with Indian GAAP requires the management to make judgments,
estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the
disclosure of contingent liabilities at the end of the reporting period. Although these estimates are based on the
management's best knowledge of current events and actions, uncertainty about these assumptions and estimates could
result in the outcomes requiring a adjustment to the carrying amounts of assets or liabilities in future periods.
b. Tangible fixed assets
"Fixed assets are stated at cost net of accumulated depreciation and accumulated impairment losses, if any. The cost
comprises purchase price and directly attributable cost of bringing the asset to its working condition for its intended use.
Gains or losses arising from derecognition of fixed assets are measured as the difference between the net disposal
proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is
derecognized."
c. Depreciation on tangible fixed assets
Depreciation on fixed assets is calculated on a written down value basis using the rates arrived at based on the useful lives
estimated by the management, or those prescribed under the Schedule XIV to the Companies Act, 1956, whichever is
higher. The Company has used the following rates to provide depreciation on its fixed assets:
Rates (WDV)
Office equipment 13.91%
Furniture & fixtures 18.1%
Computers 40%
Leasehold improvements are depreciated on a straight-line basis over the primary lease period.
d. Intangible assets
Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible
assets are carried at cost less accumulated amortization and accumulated impairment losses, if any.
Intangible assets are amortized on a straight line basis over the estimated useful economic life of 3 years.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal
proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is
derecognized.
e. Leases
Leases where the lessor effectively retains substantially all the risks and the benefits of ownership of the leased term are
classified as operating leases. Operating lease payments, in respect of non-cancellable leases are recognized as an
expense in the Statement of Profit and Loss on a straight-line basis over the lease term.
1. Corporate information
2. Basis of preparation
2.1 Summary of significant accounting policies
Notes to Financial Statements for the year ended 31st March 2013
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f. Impairment of tangible and intangible assets
The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any
indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset's
recoverable amount. An asset's recoverable amount is the higher of an asset's or cash-generating unit's (CGU) net selling
price and its value in use. The recoverable amount is determined for an individual asset unless the asset does not generate
cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of
an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable
amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In
determining net selling price, recent market transactions are taken into account if available. If no such transactions can
be identified, an appropriate valuation model is used.
g. Cash and cash equivalents
Cash and cash equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short-term
investments with an original maturity of three months or less.
h. Investments
"Investments which are readily realizable and intended to be held for not more than one year from the date on which
such investments are made, are classified as current investments. All other investments are classified as long-term
investments.
On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable
acquisition charges such as brokerage, fees and duties.
Current investments are carried in the financial statements at lower of cost and fair value determined on an individual
investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to
recognize a decline other than temporary in the value of the investments.
On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or
credited to the statement of profit and loss."
i. Inventories
The securities acquired with the intention of holding for short-term and trading are classified as stock-in-trade.
The securities held as stock-in-trade are valued at lower of cost arrived at on first-in first-out (FIFO) basis or
marketable fair value.
j. Revenue recognition
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the
revenue can be reliably measured. The following specific recognition criteria have been followed before revenue is
recognized:
Brokerage income in relation to stock broking activity is recognized on the trade date of transaction and includes stamp
duty and transaction charges and is net of scheme incentives paid. Amounts receivable from and payable to clients/stock
exchanges for broking transactions are disclosed separately as trades executed but not settled.
Commission relating to public issues is accounted for on finalization of allotment of the public issue/receipt of
information from intermediary. Brokerage Income relating to public issues / mutual fund / other securities is accounted
for based on mobilisation and intimation received from clients / intermediaries.
Depository income - Annual Maintenance Charges are recognized on accrual basis and transaction charges are
recognized on trade date of transaction.
Interest income is recognized on a time proportion basis taking into account the amount outstanding and the rate
applicable.
k. Foreign currency transactions
Initial Recognition
Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the
exchange rate between the reporting currency and the foreign currency at the date of the transaction.
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
ANNUAL REPORT076 12-13
Conversion
Foreign currency monetary items are retranslated using the exchange rate prevailing at the reporting date. Non-
monetary items, which are measured in terms of historical cost denominated in a foreign currency, are reported using the
exchange rate at the date of the transaction. Non-monetary items, which are measured at fair value or other similar
valuation denominated in a foreign currency, are translated using the exchange rate at the date when such value was
determined.
Exchange Differences
All exchange differences are recognized as income or as expenses in the period in which they arise.
l. Retirement and other employee benefits
Retirement benefit in the form of provident fund is a defined contribution scheme. The contributions to the provident
fund are charged to the statement of profit and loss for the year when the contributions are due. The Company has no
obligation, other than the contribution payable to the provident fund.
The Company operates a gratuity plan for its employees, which is a defined benefit plan. The costs of providing benefits
under this plan is determined on the basis of actuarial valuation at each year-end, using the projected unit credit method.
Actuarial gains and losses are recognized in full in the period in which they occur in the statement of profit and loss.
"Accumulated leave, which is expected to be utilized within the next 12 months, is treated as short-term employee
benefit. The Company measures the expected cost of such absences as the additional amount that it expects to pay as a
result of the unused entitlement that has accumulated at the reporting date.
The Company treats accumulated leave expected to be carried forward beyond twelve months, as long-term employee
benefit for measurement purposes. Such long-term compensated absences are provided for based on the actuarial
valuation using the projected unit credit method at the year-end. Actuarial gains/losses are immediately taken to the
statement of profit and loss and are not deferred.
m. Income taxes
"Tax expense comprises current and deferred tax. Current income-tax is measured at the amount expected to be paid to
the tax authorities in accordance with the Income-tax Act, 1961 enacted in India. The tax rates and tax laws used to
compute the amount are those that are enacted or substantively enacted, at the reporting date.
Deferred income taxes reflect the impact of timing differences between taxable income and accounting income
originating during the current year and reversal of timing differences for the earlier years. Deferred tax is measured using
the tax rates and the tax laws enacted or substantively enacted at the reporting date.
Deferred tax liabilities are recognized for all taxable timing differences. Deferred tax assets are recognized for deductible
timing differences only to the extent that there is reasonable certainty that sufficient future taxable income will be
available against which such deferred tax assets can be realized. In situations where the Company has unabsorbed
depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual certainty supported
by convincing evidence that they can be realized against future taxable profits."
At each reporting date, the company re-assesses unrecognized deferred tax assets. It recognizes unrecognized deferred
tax asset to the extent that it has become reasonably certain or virtually certain, as the case may be, that sufficient future
taxable income will be available against which such deferred tax assets can be realized.
"The carrying amount of deferred tax assets are reviewed at each reporting date. The Company writes-down the carrying
amount of deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be,
that sufficient future taxable income will be available against which deferred tax asset can be realized. Any such write-
down is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient
future taxable income will be available.
Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set-off current
tax assets against current tax liabilities and the deferred tax assets and deferred taxes relate to the same taxable entity
and the same taxation authority."
n. Segment reporting
The Company's primary business segments are reflected based on the principal business carried out, i.e. share and stock
broking on the National Stock Exchange of India Limited and Bombay Stock Exchange Limited and other related ancillary
services and third party distribution of financial products.
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
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The risk and returns of the business of the Company is neither associated with geographical segmentation nor the clients
of the Company are grouped geographically.
o. Earning per share
Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders
by the weighted average number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity
shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of
all dilutive potential equity shares.
p. Provisions
A provision is recognized when the Company has a present obligation as a result of past event, it is probable that an
outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be
made of the amount of the obligation. Provisions are not discounted to their present value and are determined based on
the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting
date and adjusted to reflect the current best estimates.
q. Contingent liabilities
A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the
occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present
obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the
obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized
because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence
in the financial statements.
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
ANNUAL REPORT078 12-13
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
3. Share capital
Authorised share capital
Issued, subscribed and paid-up share capital
Total issued, subscribed and paid-up share capital
March 31, 2013 March 31, 2012
(Rupees) (Rupees)
100,000,000 (Previous year: 100,000,000) Equity Shares of Rs. 10 each 1,000,000,000 1,000,000,000
65,625,000 (Previous year: 50,000,000) Equity Shares of Rs.10 each 656,250,000 500,000,000
656,250,000 500,000,000
a. Reconciliation of shares outstanding as at March 31, 2013 and at March 31, 2012
March 31, 2013 March 31, 2012
Equity shares No. of shares Rupees No. of shares Rupees
Outstanding at the beginning of the year 50,000,000 500,000,000 50,000,000 500,000,000
Add: Issued during the year for cash 15,625,000 156,250,000 - -
Outstanding at the end of the year 65,625,000 656,250,000 50,000,000 500,000,000
b. Terms/rights attached to equity shares
The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity shares
is entitled to one vote per share. In the event of liquidation of the Company, the holders of equity shares will be
entitled to receive remaining assets of the Company, after distribution of all preferential amounts in proportion to
their shareholdings.
c. Shares held by holding/ultimate holding company and/or their subsidiaries/associates
March 31, 2013 March 31, 2012
(Rupees) (Rupees)
SBI Capital Market Ltd., the holding company & its nominees
65,625,000 (Previous year: 50,000,000) Equity Shares of
Rs.10 each fully paid up 656,250,000 500,000,000
d. Details of shareholders holding more than 5% shares capital in aggregate in the Company
March 31, 2013 March 31, 2012
No. of shares % of holding No. of shares % of holding
Equity shares of Rs.10 each fully paid up
SBI Capital Market Ltd., the holding 65,625,000 100% 50,000,000 100%
Company & its nominees
e. The company does not have any shares reserved for issue under options, contract/commitments for sale of
shares/disinvestments as at 31st March 2013 and also as at 31st March 2012.
f. During the period of five years immediately preceding 31st March, 2013 as well as 31st March, 2012, the Company
has not issued any bonus shares or shares for consideration other than cash and also the company has not bought
back any shares during this period
g. The company does not have any securities as at 31st March 2013 and as at 31st March 2012 which are convertible into
equity/preference shares.
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Notes to Financial Statements for the year ended 31st March 2013 (contd.)
4. Reserves and surplus
Securities premium account
Closing balance
General Reserves
Closing balance
Surplus in the statement of profit and loss
Net surplus in the statement of profit and loss
Total
5. Long term borrowings and Other long-term liabilities
Long term borrowings
Deferred Payment Liabilities
Total
Other long term liabilities
Others liabilities
Total
6. Provisions
Provision for employee benefits
Total
March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Opening Balance - -
Add: premium on issue of shares received during the year 93,750,000 -
93,750,000 -
Opening Balance 3,051,832 3,051,832
Add : amount transferred from surplus balance in the statement - -
of profit and loss
3,051,832 3,051,832
Opening Balance 289,867,825 249,540,995
Add: Profit for the year 24,247,945 40,326,830
314,115,770 289,867,825
410,917,602 292,919,657
March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Retention money for capital items 1,451,812 1,246,452
1,451,812 1,246,452
Trade payables (Selling and distribution) - 346,846
Franchisee security deposits 2,099,875 2,199,875
2,099,875 2,546,721
Non-Current Current
March 31, 2013 March 31, 2012 March 31, 2013 March 31, 2012
Rupees Rupees Rupees Rupees
Provision for gratuity 2,968,127 1,468,685 - -
Provision for leave benefits 5,740,546 4,266,316 4,237,883 3,727,378
8,708,673 5,735,001 4,237,883 3,727,378
ANNUAL REPORT080 12-13
7. Trade Payables and Other current liabilities
Trade payables
Other current liabilities
Total
March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Trade payables (relating to Brokerage business) 541,384,078 207,786,562
Trade payables (Selling and Distribution and others) 28,607,890 193,137,423
569,991,968 400,923,985
Sundry creditors 38,293,462 26,657,518
Others 35,888,874 37,421,910
74,182,336 64,079,428
644,174,304 465,003,413
8. Tangible assets
Cost or valuation
At March 31, 2012
At March 31, 2013
Depreciation
At March 31, 2012
At March 31, 2013
Net block
At March 31, 2012
At March 31, 2013
9. Intangible assets
At March 31, 2012
At March 31, 2013
Amortization
At March 31, 2012
At March 31, 2013
Net block
Office Furniture & Computers Leasehold Total
Equipments Fixtures Improvements
At April 1, 2011 12,750,618 4,022,468 47,456,557 2,249,945 66,479,588
Additions 767,820 1,001,267 2,883,914 63,986 4,716,987
Disposals (759,990) (974,219) (392,745) (141,104) (2,268,058)
12,758,448 4,049,516 49,947,727 2,172,827 68,928,517
Additions 1,113,752 237,648 2,591,927 36,690 3,980,017
Disposals (1,753,607) - (26,011) - (1,779,618)
12,118,593 4,287,164 52,513,643 2,209,517 71,128,916
At April 1, 2011 3,978,201 2,069,452 27,541,777 1,183,590 34,773,020
Charge for the year 1,358,986 659,259 8,802,113 1,107,639 11,927,997
Disposals (361,295) (555,601) (250,875) (141,104) (1,308,876)
4,975,892 2,173,110 36,093,016 2,150,125 45,392,141
Charge for the year 1,121,615 485,902 6,045,168 59,392 7,712,076
Disposals (883,098) (443) (24,296) (907,837)
5,214,409 2,658,568 42,113,888 2,209,517 52,196,380
7,782,556 1,876,406 13,854,711 22,702 23,536,376
6,904,184 1,628,596 10,399,755 (0) 18,932,536
Gross block Computer Software Total
At April 1, 2011 26,415,459 26,415,459
Additions 5,305,272 5,305,272
31,720,731 31,720,731
Additions 8,319,599 8,319,599
40,040,330 40,040,330
At April 1, 2011 19,679,983 19,679,983
Charge for the year 5,000,315 5,000,315
24,680,298 24,680,298
Charge for the year 6,384,252 6,384,252
31,064,550 31,064,550
At March 31, 2012 7,040,433 7,040,433
At March 31, 2013 8,975,780 8,975,780
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
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Notes to Financial Statements for the year ended 31st March 2013 (contd.)
ANNUAL REPORT082 12-13
March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Fixed assets : (Depreciation) 337,096 568,542
337,096 568,542
Provision for doubtful debts 3,083,156 2,018,638
Provision for arbitrage deposit 80,463 78,592
Provision for gratuity 985,938 476,515
Provision for performance linked variable plan 1,798,424 2,215,404
Provision for other employee benefits 3,490,944 2,593,554
9,438,925 7,382,703
9,101,829 6,814,162
Non-Current Current
March 31, 2013 March 31, 2012 March 31, 2013 March 31, 2012
Rupees Rupees Rupees Rupees
Unsecured, considered good - 125,847 - -
- 125,847 - -
Unsecured, considered good 602,274 511,012 11,536,390 5,281,371
602,274 511,012 11,536,390 5,281,371
Unsecured, considered good 53,468,565 50,619,899 334,000 2,466,000
53,468,565 50,619,899 334,000 2,466,000
Unsecured, considered good
Advance income-tax 38,112,951 36,593,401 - -
(net of provisions for taxation)
Deposits with stock exchanges/ 35,850,000 32,150,000 - -
clearing house
Unsecured, considered doubtful
Arbitration deposit 242,230 242,230 - -
74,205,181 68,985,631 - -
Arbitration deposit provision (242,230) (242,230)
73,962,951 68,743,401 - -
128,033,790 120,000,159 11,870,390 7,747,371
10. Deferred tax asset (net)
Deferred tax liability
Gross deferred tax liability
Deferred tax asset
Gross deferred tax asset
Net deferred tax asset
11. Loans and advances
Capital advances
Advances recoverable in
cash or kind
Security deposits
Other loans and advances
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
12. Trade receivables and other assets
12.1 Trade receivables
Total
12.2 Other assets
Total
13. Cash and bank balances
Cash and cash equivalents
Other bank balances
Total
Current
March 31, 2013 March 31, 2012
Rupees Rupees
Unsecured, considered good unless stated otherwise
Outstanding for a period exceeding six months from the
date they are due for payment
Secured, considered good 1,775,362 2,937,504
Unsecured, considered good 14,575,561 2,612,312
Doubtful 8,614,514 5,792,391
24,965,437 11,342,207
Provision for doubtful receivables 8,614,514 5,792,392
(A) 16,350,923 5,549,815
Other receivables
Secured, considered good 318,693,218 70,319,175
Unsecured, considered good 187,081,124 199,971,958
Doubtful 667,209 429,332
505,774,340 270,720,465
Provision for doubtful receivables 667,209 429,332
(B) 505,107,131 270,291,133
(A+B) 521,458,054 275,840,948
Non-current
March 31, 2013 March 31, 2012
Rupees Rupees
Interest accrued on fixed deposits - 11,732
Non-current bank balances (Note 13) - 1,200,000
- 1,211,732
Non-current Current
March 31, 2013 March 31, 2012 March 31, 2013 March 31, 2012
Rupees Rupees Rupees Rupees
Balance with banks :
On current accounts - - 422,198,878 316,457,561
Deposits with original maturity less - - - 10,000,000
than 3 months
Cash on hand - - 12,002 -
- - 422,210,880 326,457,561
Interest accrued on Deposits - - 3,821,476 4,411,460
Deposits with original maturity for - - 70,700,000 1,000,000
less than 12 months
Deposits with original maturity for - 200,000 - -
more than 12 months
Deposits with stock exchange and banks - 1,000,000 213,300,000 233,450,000
- 1,200,000 287,821,476 238,861,460
Amount disclosed under non-current - (1,200,000) - -
assets (Note 12.2)
- - 710,032,356 565,319,021
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Notes to Financial Statements for the year ended 31st March 2013 (contd.)
14. Revenue from operations
14.1 Selling and distribution commission(S&D)
Total
14.2 Depository service income
Total
14.3 Other operating income
Total
15. Other non-operating income
Total
16. Employee benefit expense
Total
17. Operating expense
Total
March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Mutual funds 39,082,314 38,533,872
Initial Public Offerings(IPO) 37,191,187 6,328,366
Bonds 59,281,343 305,627,724
Wholesale Debt 12,002,618 -
Others 28,602,282 49,406,004
176,159,744 399,895,966
Annual maintenance charges 20,512,303 9,737,125
Transaction charges 5,994,110 1,449,095
Dematerialisation charges 119,399 65,056
Others 7,810 3,655
26,633,622 11,254,931
Account opening charges 12,955,968 7,502,600
Research Income 4,289,943 2,882,078
Profit on sale of inventories - 2,019,382
Miscellaneous income 4,921,199 1,127,992
22,167,110 13,532,052
Interest income 31,712,680 29,702,454
Provisions written back:
Performance linked variable payment 2,020,179 4,377,864
S&D sub-commission payable 5,345,587 7,438,227
Profit on redemption of mutual fund units - 1,196,065
Dividend income - 195,120
39,078,446 42,909,730
Salaries, wages and bonus 216,970,005 201,778,553
Contribution to provident and other funds 8,922,670 8,691,335
Gratuity expense 2,993,783 1,246,618
Staff welfare expenses 11,911,692 10,803,032
240,798,150 222,519,538
Selling and distribution sub-commission 88,870,622 295,369,874
Stamp duty 12,275,290 11,125,315
Transaction charges 3,301,886 2,737,127
Depository charges 1,102,835 1,637,829
Insurance Charges-stock brokers Indemnity 609,445 1,293,364
Cost of outsourced staff 81,406,067 71,369,045
Reimbursement of expense incurred by SBI E-broking - 5,179,000
Other operating expenses 16,027,128 19,495,615
Provision for doubtful debts 3,059,999 4,485,081
Sundry debtors written off - 5,000
206,653,272 412,697,250
ANNUAL REPORT084 12-13
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
18. Administrative expense
Total
Payments to auditor
As auditor :
In other capacity :
Total
19. Depreciation and amortization expense
Total
20. Finance costs
Total
March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Lease rent 54,628,801 53,853,371
Repairs and maintenance 11,319,221 7,953,087
Hiring charges 28,621,012 16,991,084
Advertisement 139,359 215,800
Travelling and conveyance 9,949,423 6,989,834
Communication 29,388,344 20,966,891
Printing and stationery 11,813,186 10,730,756
Legal and professional fees 2,374,677 1,724,778
Director's sitting fees 43,000 66,000
Payments to auditor 1,064,202 1,468,128
Electricity charges 5,971,521 5,269,848
Membership and subscriptions 7,550,791 7,267,214
Office maintenance 5,066,916 4,330,920
Staff recruitment 2,867,388 2,458,222
Books and periodicals 364,904 302,067
Business promotion 4,546,126 1,786,330
Courier charges 12,290,009 11,527,479
Insurance charges 1,015,233 183,542
Registration charges 50,000 437,700
Rates and taxes 21,377 41,646
Stamping and franking charges 1,017,514 786,812
Loss on sale of fixed assets/assets written off 359,837 615,244
Miscellaneous expenses 203,739 547,179
190,666,580 156,513,932
March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Audit fee 675,000 700,000
Tax audit fee 40,000 100,000
Quarterly limited review 150,000 450,000
Other services (certification fees) 160,000 200,000
Reimbursement of expenses 39,202 18,128
1,064,202 1,468,128
March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Depreciation on tangible assets 7,712,076 11,688,471
Amortization of intangible assets 6,384,252 5,000,315
14,096,328 16,688,786
March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Bank charges 4,346,970 2,455,274
4,346,970 2,455,274
ANNUAL REPORT 08512-13
SB
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ED
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
ANNUAL REPORT086 12-13
21. Earning per share (EPS)
22. Gratuity and compensated absences (Revised Accounting Standard-15)
Statement of profit and Loss
Net benefit expense
Actual return on plan assets
Balance Sheet
Plan liability/ (asset)
Changes in the present value of the defined benefit obligation are as follows:
Closing defined benefit obligation
The following reflects the profit and share data used in the basis and diluted EPS computations :
March 31, 2013 March 31, 2012
(Rupees) (Rupees)
Net profit for calculation of basic EPS and diluted EPS 24,247,945 40,326,831
No. of shares No. of shares
Weighted average number of equity shares in calculating basic EPS 64,471,276 52,864,111
The Company has a defined benefit gratuity plan. Under this plan, every employee who has completed atleast five years
of service gets a gratuity on departure at the rate of 15 days of last drawn salary for each completed year of service. The
scheme is funded with an insurance company in the form of qualifying insurance policy.
The following tables summarise the components of net benefit expense recognised in the statement of profit and loss
and the funded status and amounts recognised in the balance sheet.
Net employee benefit expense (recognised in Employee Cost)
Gratuity
March 31, 2013 March 31, 2012
Current service cost 1,821,468 2,087,735
Interest cost on benefit obligation 627,694 542,544
Expected return on plan assets (360,689) (351,580)
Net actuarial (gain) / loss recognised in the year 639,848 (1,032,081)
Past service cost - -
2,728,321 1,246,618
455,208 519,161
Benefit asset/liability
Gratuity
March 31, 2013 March 31, 2012
Present value of defined benefit obligation 9,241,837 6,310,366
Fair value of plan assets (6,273,710) (4,841,681)
2,968,127 1,468,685
Less: Unrecognised past service cost - -
2,968,127 1,468,685
Gratuity
March 31, 2013 March 31, 2012
Opening defined benefit obligation 6,310,366 4,681,028
Interest cost 627,694 542,544
Current service cost 1,821,468 2,087,735
Past service cost - -
Benefits paid (252,058) (136,441)
Actuarial (gains) / losses on obligation 734,367 (864,500)
9,241,837 6,310,366
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
Changes in the fair value of plan assets are as follows:
Gratuity
March 31, 2013 March 31, 2012
4,841,681 4,458,961
Expected return on plan assets 360,689 351,580
Contributions by employer 1,228,879 -
Benefits paid (252,058) (136,441)
Actuarial gains / (losses) 94,519 167,581
6,273,710 4,841,681
The major categories of plan assets as a percentage of the fair value of total plan assets are as follows:
Gratuity
March 31, 2013 March 31, 2012
Investments with insurer (in %) 100% 100%
100% 100%
The overall expected rate of return on assets is determined based on the market prices prevailing at the beginning of
the period, applicable to the period over which the obligation is to be settled.
The principal assumptions used in determining gratuity obligation for the Company's plan are shown below :
Gratuity
March 31, 2013 March 31, 2012
Discount rate 7.80% p.a 8.60% p.a
Expected rate of return on assets 8.00% p.a 8.00% p.a
Employee turnover 20.00% p.a 20.00% p.a
Increase in compensation cost 8.00% p.a 8.00% p.a
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority,
promotion and other relevant factors, such as supply and demand in the employment market.
Amounts for the current and previous four periods are as follows:
Gratuity
March 31, 2013 March 31, 2012 March 31, 2011 March 31, 2010 March 31, 2009
Defined benefit obligation 9,241,837 6,310,366 4,681,028 3,630,935 2,824,536
Plan assets 6,273,710 4,841,681 4,458,961 2,793,800 1,723,016
Surplus / (deficit) (2,968,127) (1,468,685) (222,067) (837,135) (1,101,520)
Experience adjustments (163,061) (40,426) (369,907) (574,971) (165,579)
on plan liabilities
Experience adjustments 94,519 167,581 41,375 110,658 (75,645)
on plan assets
Office premises has been obtained on operating lease. There are no restrictions imposed by the lease agreements and all
other lease agreements are cancellable in nature on short term notice.
As at As at
March 31, 2013 March 31, 2012
Within one year 18,971,296 47,960,892
After one year and not more than five years - 18,298,536
More than five years - -
18,971,296 66,259,428
Opening fair value of plan assets
Closing fair value of plan assets
Total
23. Leases
ANNUAL REPORT 08712-13
SB
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24. Segmental information
25. Related parties disclosures
Names of related parties and related party relationships
The Company's operations falls under a single business segment of agency/commission based services. The Company is
engaged in the business of securities broking and its allied services and third party distribution of financial products.
Further, all the transactions and the assets of the Company are recorded/located in India. Since the Company's business
activities primarily falls within a single business and geographical segment, no additional disclosure is to be provided
under AS 17 - Segment Reporting, other than those already provided in the financial statements.
Names of related parties where control exists:
Name of the Party Relationship
State Bank of India Ultimate Holding Company
SBI Capital Markets Limited Holding Company
Related parties with whom transactions have taken place during the year:
Name of the Party Relationship
SBI Life Insurance Company Limited Fellow Subsidiary
SBI Mutual Funds Fellow Subsidiary
SBI DFHI Ltd. Fellow Subsidiary
State Bank of Bikaner and Jaipur Fellow Subsidiary
State Bank of Hyderabad Fellow Subsidiary
SBI Fund Management Ltd. Fellow Subsidiary
State Bank of Mysore Fellow Subsidiary
State Bank of Patiala Fellow Subsidiary
State Bank of Travancore Fellow Subsidiary
SBI Global Factors Ltd. Fellow Subsidiary
Swati Desai, Managing Director Key Management Personnel
Anil Bhandari, Whole-Time Director & Chief Operating Officer Key Management Personnel
Related parties defined under clause 3 of Accounting Standard – 18 “Related Party Disclosures” have been identified
on the basis of representation made by the management and information available with the Company.
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
ANNUAL REPORT088 12-13
25
R
ELA
TED
PA
RTIE
S (
Co
ntd
)De
tails
of t
rans
actio
ns d
urin
g th
e yea
r
Nam
e of r
elate
d pa
rty
Year
ende
dEx
pens
es d
urin
g th
e yea
r end
edIn
com
e dur
ing
the y
ear e
nded
Othe
r tra
nsac
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durin
g th
e yea
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Empl
oyee
cost
Rent
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arin
gBa
nkRe
imbu
rsem
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ndBr
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age
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arch
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vest
men
tFix
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sset
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sset
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nt d
epos
itspa
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rece
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from
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expe
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strib
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tock
Inco
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in eq
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acqu
ired
tran
sferr
edre
turn
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strib
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brok
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Com
miss
ion
com
miss
ion
brok
ing)
capi
tal
busin
ess
(IIO
P) a
nd b
onds
Ultim
ate h
oldi
ng co
mpa
nySt
ate B
ank
of In
dia
Marc
h 31
, 201
3 -
-
9
88,3
45
-
25,
282,
292
6,9
00,5
45
2,0
43,4
01
Marc
h 31
, 201
2 -
5
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000
2,4
55,2
74
6,14
6,87
2 2
3,33
1,413
3
,263
,198
-
Hold
ing
com
pany
SBI C
apita
l Mar
ket L
imite
dMa
rch 3
1, 20
13 -
22
5,77
3 11
,872
,737
-
10
3,22
6,30
7 -
3,
932,
600
-
-
Marc
h 31,
2012
-
211,4
91
32,9
18,0
21
43,0
80
239,
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39
158,
089
2,36
9,77
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w su
bsid
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ate B
ank o
f Bik
aner
and J
aipu
rMa
rch 3
1, 20
13 -
89
,569
3,
575,
734
Marc
h 31,
2012
66,8
32
-
9,16
9,41
8 St
ate B
ank o
f Hyd
erab
adMa
rch 3
1, 20
13 -
50
,969
58
0,51
4 Ma
rch 3
1, 20
12 97
,916
27
,966
St
ate B
ank o
f Tra
vanc
ore
Marc
h 31,
2013
-
213,
007
6,16
3,03
0 Ma
rch 3
1, 20
12 11
9,82
4 5,
567
7,96
3,78
5 St
ate B
ank o
f Pat
iala
Marc
h 31,
2013
-
34,5
65
779,
876
Marc
h 31,
2012
58,0
43
19,0
81
4,61
2,40
1 St
ate B
ank o
f Mys
ore
Marc
h 31,
2013
-
4,33
4 13
,712
,980
Ma
rch 3
1, 20
12 19
,381
2,
918
4,69
1,751
SB
I LIF
E INS
URAN
CEMa
rch 3
1, 20
13 17
,122,
435
Marc
h 31,
2012
13,3
42,0
62
SBI D
FHI L
td.
Marc
h 31,
2013
17,9
68
Marc
h 31,
2012
72,3
40
SBI M
utua
l Fun
ds
Marc
h 31,
2013
2,39
7,85
2 8,
980,
610
Marc
h 31,
2012
2,29
3,00
7 18
,877
,610
SB
I Fun
d Man
agem
ent
Marc
h 31,
2013
Marc
h 31,
2012
SBI G
loba
l Fac
tors
Ltd
Marc
h 31,
2013
Marc
h 31,
2012
Key m
anag
emen
t per
sonn
elSw
ati D
esai
, Man
agin
g Dire
ctor
Marc
h 31,
2013
2,15
9,56
8 An
il Bha
ndar
i, Chi
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pera
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rMa
rch 3
1, 20
13 3,
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i Des
ai, M
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irect
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1, 20
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664,
672
Anil B
hand
ari, C
hief
Ope
ratin
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Marc
h 31,
2012
2,47
3,61
2
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
ANNUAL REPORT 08912-13
SB
ICA
P S
EC
URIT
IES L
IMIT
ED
Bala
nces
ou
tsta
nd
ing
as
at
year
en
ded
Nam
e of r
elate
d pa
rty
Year
ende
dBa
lanc
e rec
eivab
le as
at
Bala
nce p
ayab
le as
at
Inte
rest
acc
rued
:Se
lling
and
Tr
ade r
eceiv
able
Bank
bal
ance
sFix
ed D
epos
itsOt
her R
eceiv
able
Othe
r lia
bilit
y Cr
edito
rs fo
r Se
lling
and
accr
ued
dist
ribut
ion
rece
ivab
leex
pens
esdi
strib
utio
n
rece
ivab
lepa
yabl
e
Ultim
ate h
oldi
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mpa
ny
Stat
e Ban
k of
Indi
aMa
rch
31, 2
013
1,02
2,17
5 -
3
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,418
13
8,28
3,84
5 6
7,70
0,00
0 1,
819,
207
Marc
h 31
, 201
2 1,
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229
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00
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09,7
93
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054,
758
52,
550,
000
-
Hold
ing
com
pany
SBI C
apita
l Mar
ket L
imite
dMa
rch
31, 2
013
45,
823,
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10,7
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Marc
h 31
, 201
2 7
9,56
1,244
3
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5
1,838
Fello
w su
bsid
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sSt
ate B
ank
of B
ikan
er a
nd Ja
ipur
Marc
h 31
, 201
3 4
45,3
20
20,
458,
970
45,
300,
000
- Ma
rch
31, 2
012
112,
354
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000,
000
66,
832
Stat
e Ban
k of
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erab
adMa
rch
31, 2
013
522
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12
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4
0,00
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0 -
Marc
h 31
, 201
2 14
,183,
749
97,
916
Stat
e Ban
k of
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anco
reMa
rch
31, 2
013
333
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000,
000
- Ma
rch
31, 2
012
2,0
62,7
30
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6 11
5,80
0,00
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9,82
4St
ate B
ank
of P
atia
laMa
rch
31, 2
013
19,2
66
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8,65
4 1,
000,
000
- Ma
rch
31, 2
012
273
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12,9
45,8
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21,3
00,0
00
58,
043
Stat
e Ban
k of
Mys
ore
Marc
h 31
, 201
3 1,
467,
368
10,5
27,11
0 11
0,00
0,00
0 -
Marc
h 31
, 201
2 4
15,3
19
13,6
48,5
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30,
000,
000
19,3
81SB
I LIF
E IN
SURA
NCE
Marc
h 31
, 201
3 1,
115,
886
Marc
h 31
, 201
2SB
I DFH
I Ltd
.Ma
rch
31, 2
013
0.0
1Ma
rch
31, 2
012
446
.00
SBI M
utua
l Fun
ds
Marc
h 31
, 201
3 5
15,4
98
Marc
h 31
, 201
236
17.6
1SB
I Fun
d Ma
nage
men
tMa
rch
31, 2
013
Marc
h 31
, 201
2SB
I Glo
bal F
acto
rs L
tdMa
rch
31, 2
013
-
- Ma
rch
31, 2
012
3363
-
Key m
anag
emen
t per
sonn
elSw
ati D
esai
, Man
agin
g Di
rect
orMa
rch
31, 2
013
Anil
Bhan
dari,
Chi
ef O
pera
ting
Offic
erMa
rch
31, 2
013
Swat
i Des
ai, M
anag
ing
Dire
ctor
Marc
h 31
, 201
2An
il Bh
anda
ri, C
hief
Ope
ratin
g Of
ficer
Marc
h 31
, 201
2
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
ANNUAL REPORT090 12-13
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
26. Capital and other commitments
27. Contingent liabilities
28. Details of dues to micro and small enterprises as defined under the MSMED Act, 2006
29. Value of imports calculated on CIF basis
30. Expenditures in foreign currency (accrual basis)
31. Earnings in foreign currency (accrual basis)
As at March 31, 2013, the Company has commitments of Rs.73,380,264 (Previous year: Rs.102,694,224) relating to
amounts payable on open purchase orders for fixed assets.
As at As at
March 31, 2013 March 31, 2012
Claims against the company not acknowledged as debts * 105,899 1,018,000
Income tax demand ** - 3,769,480
105,899 4,787,480
* Claims against the company comprise action taken against the Company by certain customers in respect of
transactions related to purchase/sale of securities on behalf of these customers. The case for the current year is
outstanding with Arbitration Tribunal of National Stock Exchange at Delhi (during previous year, there were number of
cases which were outstanding with various appellate authorities). The Company has been advised by its legal counsel
that it is possible, but not probable, that the action will succeed and accordingly no provision for liability has been
recognized in the financial statements.
** Income tax demand comprise demand from the Indian tax authorities for payment of additional tax of Rs Nil (Previous
year: Rs.3,769,480), upon completion of their tax review for the financials years 2008-09 and 2009-10. The tax demands
are mainly on account of disallowance of a portion of expense claimed by the company under the Income tax Act. The
matter is pending before the Commissioner of Income Tax (Appeals).
The company is contesting the demands and the management, including its tax advisors, believe that its position will
likely be upheld in the appellate process. No tax expense has been accrued in the financial statements for the tax demand
raised. The management believes that the ultimate outcome of this proceeding will not have a material adverse effect on
the company's financial position and results of operations.
Based on information available with the Company, there are no suppliers included in sundry creditors who are
registered as micro, small or medium enterprise under “The Micro, Small and Medium Enterprise Development Act,
2006” as at March 31, 2012.
March 31, 2013 March 31, 2012
Capital expenditure - 56,123,655
- 56,123,655
March 31, 2013 March 31, 2012
Professional fees (SGD 32,525) 1,426,414 1,249,812
Travelling Expense (HKD 9,621) 181,791
1,608,205 1,249,812
March 31, 2013 March 31, 2012
Research income (USD 900) 48,126 234,449
48,126 234,449
ANNUAL REPORT 09112-13
SB
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URIT
IES L
IMIT
ED
Notes to Financial Statements for the year ended 31st March 2013 (contd.)
ANNUAL REPORT092 12-13
32. Prior period expenses
33. Previous year figures
March 31, 2013 March 31, 2012
Membership & subscription 346,030 500,000
Leaseline charges 2,173,979 1,250,855
Depreciation - 239,526
Legal & professional fees - 150,000
2,520,009 2,140,381
Previous year's figures have been regrouped, rearranged and reclassified wherever necessary in order to confirm to the
current year's presentation.
For Sudit K Parekh & Co. For and on behalf of the Board of Directors of
Firm Registration No.: 110512W SBICAP Securities Limited
Chartered Accountants
D.S. Khatri Arundhati Bhattacharya Swati B. Desai Dhanashri Kenkre
Partner Chairperson Managing Director Company Secretary
Membership No. : 16316
Mumbai
Date: April 15, 2013
SBICAP TRUSTEE COMPANY LIMITED
ANNUAL REPORT 09312-13
To,
The Members,
SBICAP Trustee Company Limited
Your Directors have pleasure in presenting the 8th Annual Report and the Audited Accounts of SBICAP Trustee
Company Limited for the year ended 31st March 2013.
During the year 2012-13, the Company has consolidated its position as a prominent player in the Security Trustee
Business / Market, with a significant growth in the business, in terms of both number of new assignments and
revenues. The Company has bagged 381 new accounts during the year, as against 129 in the previous year. The
revenues from operations during the year at Rs.1495.85 lacs were also 29% higher than the figure of Rs. 1162.66
lacs recorded in the financial year 2011-12.
During the year 2012-13, the Company has established itself as a prominent player in the Debenture Trusteeship
Business. As on date, the Company has concluded 268 (Two Hundred Sixty Eight) Debenture Trusteeship
assignments, which were secured inspite of tough competition from other established players in the market. The
noteworthy being appointment of STCL as Debenture Trustee in case of IDBI Omni Bonds. Similarly all the
Debenture Trusteeship cases of State Bank of India (SBI) are transferred to STCL as per the instructions from SEBI.
The Directors of the Company are confident that the Company will establish itself as a leader in the Debenture
Trusteeship business in the days to come.
Your Directors are pleased to inform that the New Delhi and Kolkata branches are doing well in new business as
well as in ongoing work relating to the Security Trustee / Debenture Trustee assignments. STCL is planning to open
further branches at Bangalore, Chennai, Hyderabad and Ahmedabad during the year 2013-14. With the expected
presence across the Country, the Directors are confident of faster growth in our business.
During the period under review, the total Business Income of the Company was Rs. 1360.45 lacs, apart from Other
Income of Rs. 135.40 lacs. The company incurred total Expenditure of Rs. 380.98 lacs, with resultant Profit of
Rs. 1114.87 lacs before provision for income tax, as against the PBT of Rs. 864.72 lacs in the previous year.
During the year, the performance of the Company has been quite satisfactory, considering the growing intense
competition, with extremely low fees quoted by the competitors and offered by clients.
During the year, the Company issued Bonus Shares in the ratio of 1 Equity Share of Rs. 10/- each, for every one
existing Equity Share held. The Company has capitalized a sum of Rs. 50,00,000/- (Rupees Fifty lacs only) from its
Reserves on 26th February 2013 towards issuance of the Bonus Shares, and accordingly, the paid up capital of the
Company has increased from Rs. 50 lacs to Rs. 100 lacs only.
Out of the current years profit the Directors propose that a sum of Rs. 75,19,955/- be transferred to the General
Reserve. The Directors have proposed a Final Dividend of Rs.1.25 per share on the expanded capital base, subject
to approval by the Members in the Annual General Meeting.
The Company has not accepted any deposits from Public, during the year under review.
During the year under review, Mr. Rajeev Krishnan and Mr. Sunit Joshi have resigned from the Directorship of the
Company on account of their reportation to State Bank of India and Mr. V.G. Kannan – President & COO and Mr.
Avinash Kulkarni – EVP - CMG have been inducted in the Board. Also, Mr. V. Muralidharan – CFO has been newly
appointed as Director of the Board of Directors of STCL.
In accordance with the provisions of the Companies Act, 1956, Shri Supratim Sarkar, Director, holds office upto
the date of the 8th Annual General Meeting. The Company has received a Notice from a Member, under Section
257 of the Companies Act, 1956, proposing him as a candidate for the office of Director liable to retire by rotation.
Shri Supratim Sarkar has conveyed his consent for being re-appointed as Director.
I. Operations
II. Financial Results
III. Bonus Shares
IV. Dividend & Transfer to General Reserve
V. Deposits
VI. Directors
Directors' Report for the year 2012-2013
ANNUAL REPORT094 12-13
DIRECTORS' REPORT (contd.)
Accordingly, Shri Supratim Sarkar, Director, retires by rotation at the 8th Annual General Meeting of the Company,
and being eligible, has offered himself for re-appointment.
Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Directors confirm that:
(i) in the preparation of the annual accounts, the applicable accounting standards have been followed;
(ii) appropriate accounting policies have been selected and applied consistently, and the judgements and
estimates that have been made are reasonable and prudent so as to give a true and fair view of the state of
affairs of the Company as on 31st March 2013 and of the profit or loss of the Company for the year ended
31st March, 2013;
(iii) proper and sufficient care has been taken for the maintenance of adequate accounting records, in
accordance with the provisions of the Companies Act, for safeguarding the assets of the Company and for
preventing and detecting frauds and other irregularities; and
(iv) the annual accounts have been prepared on a going concern basis.
The Directors also wish to draw the kind attention of the Shareholders to the Report of the Auditors to the
Shareholders issued by M/s. Khandelwal Jain & Co. - the Statutory Auditors, on the financial accounts for the year
ended March 31, 2013.
M/s. Khandelwal Jain & Co., Chartered Accountants, the Statutory Auditors of the Company, retire at the
conclusion of the 8th Annual General Meeting of the Company.
The Board of Directors, at their 30th Meeting held on 10th April 2013, have recommended for appointment of
M/s. Sudit K. Parikh & Co., Chartered Accountants, as the Statutory Auditors of the Company to hold office from
the conclusion of the 8th Annual General Meeting upto the conclusion of the 9th Annual General Meeting of the
Company. The Company has received a Certificate / Consent from M/s. Sudit K. Parikh & Co. to the effect that their
appointment, if made, would be within the limits prescribed under Section 224(1B) of the Companies Act, 1956.
In terms of the above Rules issued by the Central Government, the following information is furnished:
Since the Company is engaged only in Trusteeship activities, there is no information to report under this head.
Foreign Exchange Earnings and Outgo
During the period under review, the Company has not earned or expended any foreign exchange.
The information, as required under Section 217(2A) of the Companies Act, 1956, read with the Companies
(Particulars of Employees) Rules, 1975, as amended, is furnished in Annexure 'A'.
The Board is grateful to the State Bank Group and SBICAP & its associates for providing all support to the
Company. The Board also conveys its appreciation to all employees of the Company for their sincere and hard
work in these challenging times and difficult environment.
VII. Directors' Responsibility Statement
VIII. Auditors
IX. Companies (Disclosures of Particulars in the Report of the Board of Directors) Rules, 1988
Conservation of Energy and Technology Absorption
X. Particulars of Employees
XI. Acknowledgement
V. G. Kannan Supratim Sarkar Avinash Kulkarni V. Muralidharan
Director Director Director Director
Date: 22nd April 2013
For and on behalf of the Board of Directors
ANNUAL REPORT 09512-13
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STATEMENT PURSUANT TO SECTION 217(2A) OF THE COMPANIES ACT, 1956, AND THE COMPANIES
(PARTICULARS OF EMPLOYEES) RULES, 1975
Name Designation / Remunera- Qualifications Date of Age Last Employment
Nature of Duties tion (Rs.) & Experience commencement of held and Designation
employment
(A) Employed throughout the year and in receipt of remuneration aggregating not less than Rs. 60,00,000/- per annum
NIL
(B) Employed for the part of the year and are in receipt of remuneration aggregating not less than Rs. 5,00,000/- per month
NIL
Annexure
ANNUAL REPORT096 12-13
To
The Members,
SBICAP TRUSTEE COMPANY LIMITED
We have audited the accompanying financial statements of SBICAP TRUSTEE COMPANY LIMITED (“the Company”),
which comprise the Balance Sheet as at March 31, 2013, the Statement of Profit and Loss and Cash Flow Statement
for the year then ended, and a summary of significant accounting policies and other explanatory information
(collectively referred to as “Financial Statements”).
Management is responsible for the preparation of these financial statements that give a true and fair view of the
financial position, financial performance and cash flows of the Company in accordance with the recognition and
measurement principles laid down and other accounting principles generally accepted in India. This responsibility
includes the design, implementation and maintenance of internal control relevant to the preparation and
presentation of the financial statements that give a true and fair view and are free from material misstatement,
whether due to fraud or error.
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India.
Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the
risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the Company's preparation and fair presentation of
the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit
also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting
estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinion.
In our opinion and to the best of our information and according to the explanations given to us, the said accounts,
read together with significant accounting policies and the notes thereon, give the information required by the
Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting
principles generally accepted in India:
i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2013;
ii) in the case of the Statement of Profit and Loss, of the profit of the Company for the year ended on that date;
and
iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.
A. As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of the Companies Act, 1956, as amended by the Companies (Auditors'
Report) (Amendment) Order, 2004 and on the basis of such checks as we considered appropriate and
according to the information and explanations given to us during the course of the audit, we give in the
Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order to the extent they are
applicable to the Company.
B. Further to our comments in the Annexure referred to in paragraph A above, and as required by section 227(3)
of the Companies Act, 1956, we report that:
i) we have obtained all the information and explanations which to the best of our knowledge and belief were
necessary for the purpose of our audit;
ii) in our opinion proper books of account as required by law have been kept by the Company so far as appear
from our examination of those books;
1. Report on the Financial Statements
2. Management's Responsibility for the Financial Statements
3. Auditor's Responsibility
4. Opinion
5. Report on Other Legal and Regulatory Requirements
Independent Auditor's Report on Financial Statements
ANNUAL REPORT 09712-13
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For KHANDELWAL JAIN & CO.
Chartered Accountants,
Firm Registration No.: 105049W
(S. S. SHAH)
PARTNER
Membership No.33632
Place : Mumbai
Date : April 22, 2013
iii) the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this Report are in
agreement with the books of account; and
iv) in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the
Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956.
v) On the basis of written representations received from the directors of the Company as on March 31, 2013 and
taken on record by the Board of Directors and according to the information and explanation given to us, none
of the directors is disqualified as on 31st March, 2013, from being appointed as a director in terms of Section
274(1)(g) of the Companies Act, 1956.
ANNUAL REPORT098 12-13
Independent Auditor's Report on Financial Statements
(Referred to in Paragraph 5A of our report of even date to the Members of SBICAP TRUSTEE COMPANY LIMITED on the
accounts for the year ended March 31, 2013.)
1. (a) The company has maintained proper records showing full particulars, including quantitative details and
situation of fixed assets.
(b) As explained to us, physical verification of fixed assets was conducted by the management. We have been
informed that no material discrepancies were noticed on such physical verification.
(C) No substantial part of fixed assets of the Company has been disposed off during the year, and the going
concern status of the Company is not affected.
2. The Company's nature of operations do not require it to hold inventories. Accordingly, clauses (ii) (a) to (ii) (c) of
paragraph 4 of the Companies (Auditor's Report) Order, 2003 ('the Order') are not applicable to the Company.
3. (a) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in
the register maintained under section 301 of the Companies Act, 1956.
(b) The Company has not taken any loans, secured or unsecured, from companies, firms or other parties covered in
the register maintained under section 301 of the Companies Act, 1956.
4. In our opinion and according to the information and explanations given to us, there is an adequate internal control
system commensurate with the size of the Company and the nature of its business with regard to the purchase of
fixed assets and also for rendering of services. We have not observed any continuing failure to correct major
weakness in the internal control system during the course of our audit.
5. Based on the audit procedures applied by us and according to the information and explanations provided by the
management, we are of the opinion that the Company has not entered into any contracts or arrangements that
need to be entered in the register maintained under section 301 of the Companies Act, 1956.
6. According to the information and explanations given to us, the Company has not accepted any deposits during the
period from the public within the meaning of the provisions of Sections 58A and 58AA or any other relevant
provisions of the Companies Act, 1956 and the rules made thereunder.
7. In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.
8. According to the information and explanations given to us, the Central Government has not prescribed the
maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956 for any of the activities of the
Company.
9. (a) According to the information and explanations given to us, and on the basis of our examination of the books of
account, there were no undisputed statutory dues payable including provident fund, investor education and
protection fund, employees' state insurance, income-tax, sales-tax, wealth-tax, service-tax, custom duty, excise
duty, cess and any other statutory dues wherever applicable.
(b) According to the information and explanation given to us, there were no dues in respect of sales tax, income
tax, customs duty, wealth tax, service tax, excise duty and cess that have not been deposited with the
appropriate authorities on account of any dispute.
10. The Company does not have accumulated losses at the end of the financial year and has not incurred cash losses
during the financial year covered by the audit and in the immediately preceding financial year.
11. The Company has not taken any loan from banks or financial institutions and the Company has not issued any
debentures.
12. The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures
and other securities.
13. In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of
clause (xiii) of paragraph 4 of the Order are not applicable to the Company.
14. The Company is not dealing or trading in shares, securities, debentures and other investments.
ANNEXURE TO THE AUDITORS' REPORT
ANNUAL REPORT 09912-13
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15. In our opinion and according to the information and explanations given to us, the Company has not given
guarantee for loans taken by others from banks or financial institutions.
16. The Company has not taken any term loans during the year.
17. In our opinion and according to the information and explanations given to us and on an overall examination of the
Balance sheet of the Company, we report that, the company has not raised funds on short term basis during the
year and hence the question of utilization does not arise.
18. The Company has not made any preferential allotment of shares to the parties and companies covered in the
register maintained under section 301 of the Companies Act, 1956.
19. The Company has not issued any Debentures during the year covered by our report.
20. During the year covered by our report, the Company has not raised any money by way of public issue.
21. Based upon the audit procedures performed and the information and explanations given by the management, we
report that no fraud on the Company or by the Company has been noticed or reported during the year.
ANNEXURE TO THE AUDITORS' REPORT
For KHANDELWAL JAIN & CO.
Chartered Accountants,
Firm Registration No.: 105049W
(S. S. SHAH)
PARTNER
Membership No.33632
Place : Mumbai
Date : April 22, 2013
ANNUAL REPORT100 12-13
BALANCE SHEET AS AT 31ST MARCH, 2013
PARTICULARS NOTE NO. AS AT 31 March 2013 AS AT 31 March 2012
(Amount in Rs.) (Amount in Rs.)
a) Share Capital 2 10,000,000 5,000,000
b) Reserves and Surplus 3 185,004,248 116,267,140
195,004,248 121,267,140
a) Deferred Tax Liabilities (Net) 4 117,543 229,900
b) Other long Term Liabilities 5 346,897 209,500
464,440 439,400
a) Trade Payables 6 - 13,300
b) Other Current Liablities 7 5,630,984 3,604,403
c) Short Term Provisions 8 6,462,438 4,513,251
12,093,422 8,130,954
207,562,110 129,837,494
(a) Fixed Assets 9
(I) Tangible Assets 2,904,674 1,937,955
(ii) Intangible Assets 354,769 591,282
(b) Long Term Loans and Advances 10 3,905,260 3,101,000
7,164,703 5,630,237
(a) Trade Receivables 11 19,890,016 6,168,934
(b) Cash and Bank Balances 12 159,589,403 108,293,146
(c) Short Term Loans and Advances 13 20,917,988 9,745,177
200,397,407 124,207,257
207,562,110 129,837,494
I. EQUITY AND LIABILITIES
1. Shareholders' Funds
2. Non-Current Liablities
3. Current Liablities
TOTAL
II. ASSETS
1. Non Current Assets
2. Current Asses
TOTAL
For KHANDELWAL JAIN & CO.
CHARTERED ACCOUNTANTS
Firms Registration No.: 105049W
V.G.Kannan Supratim Sarkar
Director Director
(S.S SHAH) Avinash Kulkarni V.Muralidharan
PARTNER Director Director
Membership No.: 33632
PLACE : MUMBAI Ajit Joshi
DATE : April 22, 2013 Company Secretary
Significant Accounting Policies & Notes to Accounts :Note 1 & 2 to 19
Notes attached forms an integral part of the accounts
As per our report of even date
For and on behalf of the Board of Directors
ANNUAL REPORT 10112-13
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STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31ST MARCH, 2013
For KHANDELWAL JAIN & CO.
CHARTERED ACCOUNTANTS
Firms Registration No.: 105049W
V.G.Kannan Supratim Sarkar
Director Director
(S.S SHAH) Avinash Kulkarni V.Muralidharan
PARTNER Director Director
Membership No.: 33632
PLACE : MUMBAI Ajit Joshi
DATE : April 22, 2013 Company Secretary
Significant Accounting Policies & Notes to Accounts :Note 1 & 2 to 19
Notes attached forms an integral part of the accounts
As per our report of even date
For and on behalf of the Board of Directors
PARTICULARS NOTE NO. FOR THE YEAR ENDED FOR THE YEAR ENDED
31ST MARCH, 2013 31ST MARCH, 2012
(Amount in Rs) (Amount in Rs)
Revenue from Operations 14 136,045,062 107,761,303
Other Income 15 13,539,640 8,504,876
149,584,702 116,266,179
Employee Benefit Expenses 16 21,544,044 16,939,114
Depreciation and Amortisation Expenses 17 1,236,786 883,085
Other Expenses 18 15,316,684 11,972,153
38,097,514 29,794,352
111,487,188 86,471,827
- Current Tax 36,400,000 27,800,000
- Excess provision of income tax of earlier year written back - (32,051)
- Deferred Tax (112,358) 448,680
75,199,546 58,255,198
Basic 75.20 58.26
Diluted 75.20 58.26
Basic 1,000,000 1,000,000
Diluted 1,000,000 1,000,000
Total Income
EXPENSES
Total Expenses
Profit before Tax
Tax Expense
Profit after tax for the year
Earning per Share of par value of Rs.10/- each
Number of shares used in computing earnings per share
ANNUAL REPORT102 12-13
CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2013
ANNUAL REPORT 10312-13
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(Amount in Rupees)
Current Year Previous Year
Net Profit Before Tax 111,487,188 86,471,827
Depreciation 1,236,786 883,085
Provision for Doubtful Debts 602,758 84,492
Interest Income Considered separately 13,331,547 8,344,276
Profit on sale of fixed assets 93,453 11,038
99,901,732 79,084,090
Decrease/(Increase) in Trade Receivables (14,323,840) 2,334,194
(Increase) in Other Current Assets (92,090)
(Increase) in Loans and Advances (664,663) (10,541,469)
(Decrease)/Increase in Current Liabilities 3,662,255 (7,111,302)
Increase in Long term Liabilities 137,397
Income Tax paid (38,666,818) (17,400,000)
50,046,063 46,273,423
(Purchase) of Fixed Assets (2,214,671) (2,210,644)
Interest received 4,285,958 4,062,940
Proceeds from sale of fixed assets 341,132 60,413
2,412,419 1,912,709
Dividend & Dividend Distribution Tax Paid (1,162,225) (583,044)
(1,162,225) (583,044)
Net change in Cash & Cash Equivalents (A+B+C) 51,296,257 47,603,088
Opening Balance of Cash & Cash Equivalents 108,293,146 60,690,058
Closing Balance of Cash & Cash Equivalents 159,589,403 108,293,146
A. CASH FLOW FROM OPERATING ACTIVITIES
Adjustment for :-
Operating Profit before Working Capital Changes
Net Cash Flow from Operating Activities
B. CASH FLOW FROM INVESTING ACTIVITIES
Net Cash (used in)/from Investing Activities
C. CASH FLOW FROM FINANCING ACTIVITIES
Net Cash (used in) financing activities
For KHANDELWAL JAIN & CO.
CHARTERED ACCOUNTANTS
Firms Registration No.: 105049W
V.G.Kannan Supratim Sarkar
Director Director
(S.S SHAH) Avinash Kulkarni V.Muralidharan
PARTNER Director Director
Membership No.: 33632
PLACE : MUMBAI Ajit Joshi
DATE : April 22, 2013 Company Secretary
As per our report of even date
For and on behalf of the Board of Directors
1 STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
1.1 Basis of Preparation of Financial Statements:
1.2 Use of estimates:
1.3 Fixed Assets and Depreciation:
1.4 Investments:
1.5 Recognition of Revenue:
1.6 Provision for Current and Deferred Tax:
The financial statements are prepared in accordance with Generally Accepted Accounting Principles in India
under the historical cost convention on the accrual basis, and in compliance with the accounting standards
issued by the Institute of Chartered Accountants of India ("ICAI"), the provisions of the Companies Act, 1956 and
other applicable statutory enactments.
The preparation of the financial statements in conformity with generally accepted accounting principles (GAAP)
requires management to make estimates and assumptions that affect the reported amount of assets, liabilities,
revenues and expenses and disclosure of contingent liabilities on the date of the financial statements. The
estimates and assumptions used in the accompanying financial statements are based upon management's
evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may
differ from the estimates and assumptions used in preparing the accompanying financial statements. Any
revision to accounting estimates is recognised prospectively in current and future periods.
Fixed Assets are stated at cost of acquisition or construction less accumulated depreciation and impairment loss,
if any. Cost comprises the purchase price and any attributed cost of bringing the asset to its working condition for
its intended use.
The Company provides depreciation on fixed assets, other than laptops and mobile phones, on Written Down
Value Method, at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956, on a pro –
rata basis. Depreciation on laptops and mobile phones is provided on Straight Line Method, at 33.33% per
annum on a pro– rata basis.
Assets individually costing less than Rs.5,000/- are fully depreciated in the year of acquisition.
Investments are classified into Current Investments and Non-Current Investments.
Current investments are stated at cost or net realisable value, whichever is lower.
Non-Current investments are stated at cost. Provision for diminution is made to recognise a decline, other than
temporary, determined separately for each individual investment.
g Trusteeship Acceptance Fees are recognised on the acceptance of trusteeship assignment.
g Trusteeship Service Charges are recognised / accrued on the basis of terms of Trusteeship Contracts /
Agreements entered into with clients.
g Interest income is accounted for on accrual basis.
g Dividend income is recognised when the right to receive dividend is established.
Income tax expense comprises current tax (i.e. amount of tax for the period determined in accordance with the
income tax law) and deferred tax charge or credit (reflecting the tax effects of timing differences between
accounting income and taxable income for the period).
The deferred tax charge or credit and the corresponding deferred tax liabilities or assets are recognised using the
tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred tax assets are
recognised only to the extent there is reasonable certainty that the assets can be realised in future; however,
where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are
recognised only if there is virtual certainty of realisation of such assets. Deferred tax assets are reviewed as at each
balance sheet date and written down or written up to reflect the amount that is reasonably / virtually certain (as
the case may be) to be realised.
Debts outstanding for period of Provisions for doubtful debts
More than 6 months but not exceeding 12 months 10%
More than 12 months 100%
Notes to Financial Statements for the year ended 31st March 2013
ANNUAL REPORT104 12-13
1.8 Earnings per Share:
1.9 Provisions, Contingent Liabilities and Contingent Asset:
1.10 Employee Benefits:
1.11 Cenvat Credit:
In accordance with the Accounting Standard 20 ( AS - 20) "Earnings Per Share" issued by the Institute of Chartered
Accountants of India, basic / diluted earnings per share is computed using the weighted average number of
shares outstanding during the period.
Provisions involving substantial degree of estimation in measurement are recognised when there is a present
obligation as a result of past events and it is probable that there will be outflow of resources. Contingent
liabilities are not recognised but are disclosed in the notes. A disclosure for a contingent liability is made when
there is a possible obligation or a present obligation that may, but probably will not, require an outflow of
resources. When there is a possible obligation or a present obligation in respect of which the likelihood of
outflow of resources is remote, no provision or disclosure is made. Contingent assets are neither recognised nor
disclosed in the financial statements.
Gratuity
The Company has adopted the Group Gratuity Scheme of Life Insurance Corporation of India and annual
contributions determined by using actuarial valuation technique has been paid to the scheme and is charged to
Profit & Loss Account.
Provident fund
The Company contributes to a recognized provident fund which is a defined contribution scheme. The
contributions are accounted for on an accrual basis and recognized in the profit and loss account.
Compensated Absences
Short Term compensated absences are provided for based on estimates. Long Term compensated absences are
provided for based on actuarial valuation. The actuarial valuation is done as per projected unit credit method.
Cenvat Credit is accounted for by reducing relevant expenses /fixed assets.
Notes to Financial Statements for the year ended 31st March 2013
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NOTE "3"
RESERVES AND SURPLUS
Profit and Loss Account
Opening Balance
TOTAL
As At March 31, 2013 As At March 31, 2012
(Amount in Rs.) (Amount in Rs.)
General reserve
Opening balance 7,694,255 6,368,735
Add: Transferred from Profit & Loss Account 7,519,955 5,825,520
Less: Utilised for issue of bonus shares (5,000,000) (4,500,000)
10,214,210 7,694,255
108,572,885 57,305,432
Add: Net profit after tax transferred from Statement of Profit & Loss 75,199,546 58,255,198
Amount available for appropriation 183,772,431 115,560,630
Appropriations:
Final Dividend 1,250,000 1,000,000
Tax on Dividend 212,438 162,225
Transfer to General reserve 7,519,955 5,825,520
Profit and Loss Account - Closing Balance 174,790,038 108,572,885
185,004,248 116,267,140
As At March 31, 2013 As At March 31, 2012
(Amount in Rs.) (Amount in Rs.)
Authorised Capital
20,00,000 (previous year 5,00,000) Equity Shares of Rs.10 each 20,000,000 5,000,000
20,000,000 5,000,000
10,00,000 (previous year 5,00,000) Equity Shares of Rs. 10/- each fully 10,000,000 5,000,000
paid up at par. [10,00,000 Equity shares (previous year 5,00,000) of
Rs.10/- each fully paid are held by SBI Capital Markets Limited, the
Holding Company.] [Out of the above, 9,50,000 (previous year
4,50,000) equity shares of Rs.10/- each were issued as fully paid up
bonus shares in the last five years by way
of capitalization of free reserves.]
TOTAL 10,000,000 5,000,000
Name of shareholder As At March 31, 2013 As At March 31, 2012
SBI Capital Markets Limited
No. of Shares held 999,880 499,946
% of shareholding 99.99 99.99
Particulars As At March 31, 2013 As At March 31, 2012
Number of shares at the beginning 500,000 50,000
Add: Bonus Shares issued on captialsation of reserves 500,000 450,000
Number of shares at the end 1,000,000 500,000
NOTE "2"
SHARE CAPITAL
Issued, Subscribed and Paid up capital
Details of shareholder holding more than 5% shares
is set out below :
Reconciliation of the number of shares outstanding
is set out below:
Notes to Financial Statements for the year ended 31st March 2013
ANNUAL REPORT106 12-13
As At March 31, 2013 As At March 31, 2012
(Amount in Rs.) (Amount in Rs.)
(a) Deferred Tax Assets
(i) Provision for Doubtful Debts 195,565 -
(ii) Preliminary expenditure - 1,622
195,565 1,622
(b) Deferred Tax Liabilities
Related to Fixed Assets 313,108 231,523
313,108 231,523
(117,543) (229,900)
Trust Settlement Fees 346,897 209,500
346,897 209,500
NOTE"4"
DEFERRED TAX LIABILITY (NET)
NET DEFERRED TAX LIABILITY
NOTE"5"
OTHER LONG TERM LIABILITIES
TOTAL
NOTE "6"
TRADE PAYABLES
TOTAL
As At March 31, 2013 As At March 31, 2012
(Amount in Rs.) (Amount in Rs.)
Trust Settlement Fees - 13,300
- 13,300
NOTE"7"
OTHER CURRENT LIABILITIES
TOTAL
NOTE"8"
SHORT TERM PROVISIONS
TOTAL
Advances received from customers 600,000 694,500
Advances received from customers for CERSAI 1,787,430 120,000
Income received in Advance 1,696,366 2,023,363
Other Payables
(a) Statutory dues 309,291 336,264
(b) Creditors/Provision for expenses 1,027,984 312,678
(c) Retention monies 209,913 117,598
5,630,984 3,604,403
Provision for Employee benefits
- Performance Linked variable payment 5,000,000 3,351,026
Proposed Dividend 1,250,000 1,000,000
Tax on Dividend 212,438 162,225
6,462,438
Notes to Financial Statements for the year ended 31st March 2013
ANNUAL REPORT 10712-13
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360,8
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t (b
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43,5
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1
16
,73
9
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56
,71
8
76
,60
9
10
1,9
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32,5
51
146,0
11
210,7
07
266,9
01
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re &
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ture
s 3
11,3
06
5
,77
6
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4
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229,7
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,21
4,6
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4
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,10
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,67
3
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,273
225,4
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-
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Year
1,7
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,21
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Tan
gib
le A
ssets
Su
b -
tota
l
Inta
ng
ible
Ass
ets
Su
b -
tota
l
Tota
l DESC
RIP
TIO
NG
RO
SS B
LOC
KD
EPREC
IATIO
N &
AM
ORTIZ
ATIO
NN
ET B
LOC
K
FIX
ED
AS
SETS A
S A
T 3
1 S
T M
AR
CH
, 2013
(Am
ou
nt
in R
s.)
NO
TE "
9"
Notes to Financial Statements for the year ended 31st March 2013
ANNUAL REPORT108 12-13
As At March 31, 2013 As At March 31, 2012
(Amount in Rs.) (Amount in Rs.)
Rental Deposits 3,905,260 3,101,000
Unsecured, Considered Good
3,905,260 3,101,000
Debts Outstanding for period exceeding six months
Considered Good 5,424,807 760,426
Considered Doubtful 687,250 84,492
6,112,057 844,918
Less: Provision for doubtful debts 687,250 84,492
5,424,807 760,426
Others
Considered Good 14,465,209 5,408,508
Considered Doubtful - -
14,465,209 5,408,508
19,890,016 6,168,934
Cash and Cash Equivalents 2,000 641
Balances with Banks:
In Current Account 2,762,077 2,934,609
In Current Account - Escrow account for CERSAI 1,787,430 120,000
Other Bank Balance
In Fixed Deposits (with maturity of more than 3 months but 50,437,896 -
less than 12 months from the date of Balance sheet)
In Fixed Deposits (with maturity of more than 12 months from 104,600,000 105,237,896
the date of Balance sheet)
159,589,403 108,293,146
The deposits maintained by the Company with banks comprise of time deposits, which can be withdrawn by the
Company at any point without prior notice or penalty on the principal.
Advance Income Tax (Net of Provisions) 5,873,306 3,606,488
Cenvat Credit Receivable 115,845 33,680
Prepaid Expenses 372,242 983,706
Advances to employees towards expenses 386,493 241,794
Accrued Interest on Fixed Deposits due from related parties* 13,917,690 4,872,100
Expenses recoverable from clients 44,025 7,409
Service Tax paid in advance 208,387 -
20,917,988 9,745,177
* Accrued interest on Fixed Deposits due from related parties include State Bank of India Rs.1,34,09,709/- (Previous Year Rs.48,72,100/-), State Bank of Bikaner and Jaipur Rs.4,92,644/- (Previous Year Rs. NIL) and State Bank of Patiala Rs.15,337/- (Previous Year Rs. NIL).
NOTE"10"
LONG TERM LOANS AND ADVANCES
TOTAL
NOTE "11"
TRADE RECEIVABLES
(Unsecured )
TOTAL
NOTE "12"
CASH AND BANK BALANCES
TOTAL
NOTE "13"
SHORT TERM LOANS & ADVANCES
(Unsecured, Considered Good)
TOTAL
Notes to Financial Statements for the year ended 31st March 2013
ANNUAL REPORT 10912-13
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NOTES TO THE PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2013
AS AT 31.03.2013 AS AT 31.03.2012
(Amount in Rs.) (Amount in Rs.)
Trusteeship Acceptance Fees 27,767,519 24,840,000
Trusteeship Service Charges 108,277,543 82,921,303
136,045,062 107,761,303
Interest Income 13,331,547 8,330,284
Miscellaneous Income 114,640 149,562
Interest on Income Tax refund - 13,992
Profit on Sale of Asset 93,453 11,038
13,539,640 8,504,876
Employee Salary, Allowances and Benefits 19,802,361 14,944,595
Staff Welfare Expenses 798,242 1,369,538
Contribution to Gratuity Fund 280,413 100,858
Contribution to Provident Fund (Employer's) 663,028 524,123
21,544,044 16,939,114
Tangible Assets 1,000,273 761,998
Intangible Assets 236,513 121,087
1,236,786 883,085
Rent 6,485,468 6,217,600
Rates & Taxes 141,644 2,164
Insurance 143,985 127,332
Legal and Professional Fees 2,475,116 1,794,018
Payment to Auditor's
a) as auditor 150,000 125,000
b) for tax audit 60,000 50,000
c) other services 30,000 18,000
Computer Stationery 283,626 326,382
Conveyance 1,352,990 832,631
Electricity Charges 620,212 484,431
House Keeping & Security Expenses 544,483 456,332
Repairs and Maintenance 396,592 382,268
SEBI Application & Registration Fees 333,029 333,942
Communication Expenses 871,941 448,132
Provision for Doubtful Debts 602,758 84,492
Miscellaneous Expenses 641,223 289,429
Bad Debts 183,617 -
15,316,684 11,972,153
NOTE "14"
REVENUE FROM OPERATIONS
TOTAL
NOTE "15"
OTHER INCOME
TOTAL
NOTE "16"
EMPLOYEE BENEFIT EXPENSES
TOTAL
NOTE "17"
DEPRECIATION AND AMORTISATION
TOTAL
NOTE "18"
ADMINISTRATION AND OTHER EXPENSES
TOTAL
ANNUAL REPORT110 12-13
Where Control exists: -
A Name of Party Relationship
State Bank of India Ultimate Holding Company
SBI Capital Markets Ltd. Holding Company
B Fellow Subsidiary and Associates Relationship
SBICAPS Ventures Ltd. Fellow Subsidiary
SBICAP Securities Ltd. Fellow Subsidiary
SBICAP (UK) Limited Fellow Subsidiary
SBICAP (Singapore) Limited Fellow Subsidiary
State Bank of Patiala Associate of State Bank of India
State Bank of Bikaner and Jaipur Associate of State Bank of India
C Key Management Personnel Designation
Mr. Vishwas Pathak Sr.Vice President & COO
NOTE ”19” NOTES FORMING PART OF ACCOUNTS
19.1 Nature of activities:
19.2 Segment Reporting:
The Company carries out various corporate trusteeship activities viz. security trusteeship, debenture trusteeship, security agent, share pledge trusteeship, safe custody of documents etc.
The Company is engaged in only one line of business namely Corporate Trusteeship Activities and as such it has no other reportable segment as defined in Accounting Standard 17 on “Segment Reporting”.
Particulars FY 2012 - 2013 FY 2011 - 2012
As Statutory Auditor (Including Service Tax) Rs.1,68,540 Rs.1,37,875
As Tax Auditor (Including Service Tax) Rs.67,416 Rs.55,150
Other Services (Including Service Tax) Rs.33,709 Rs.19,854
(Amount in Rupees)
Particulars FY 2012 - 2013 FY 2011 - 2012
a. Expenditure in Foreign Currency Nil Nil
b. Earning in Foreign Currency – 3,93,656 Nil
(Amount in Rupees)
19.319.4
19.5
Auditors Remuneration:Information with regard to matters specified in paragraph 4C (Applicable in case of Manufacturing Companies) of
stpart II of Schedule VI to the Companies Act, 1956, are not applicable for the year ended 31 March 2013.
Information with regard to matters specified in paragraph 4D of part II of Schedule VI to the Companies Act, 1956, are as under:
19.6 Related Party Information:(i) Relationships:
NOTES TO THE PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2013
ANNUAL REPORT 11112-13
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SBI Capital Markets Ltd Payments made on behalf of
the Company & reimbursed
State Bank of India (Cuffe Parade Interest Income 23,946 26,741
Branch Mumbai )
Fixed Deposits Balance as at 31 March 2,28,425 2,28,425
2013 & 2012
Accrued Interest on Fixed Deposit as at 43,048 21,497
31 March 2013 & 2012
State Bank of India (Fort Branch Interest Income 1,27,43,173 83,03,543stMumbai) Bank Balance as at 31 March 2013 & 45,49,507 30,54,609
2012
Fixed Deposits Balance as at 31 March 13,20,09,471 10,50,09,471
2013 & 2012
Accrued Interest on Fixed Deposit as at 1,33,66,661 48,50,603
31 March 2013 & 2012
State Bank of Bikaner and Jaipur Interest Income 5,47,386 -
(Fort Branch, Mumbai)
Fixed Deposits Balance as at 31 March 1,65,00,000 -
2013 & 2012
Accrued Interest on Fixed Deposit as at 4,92,644 -
31 March 2013 & 2012
State Bank of Patiala (Colaba Branch, Interest Income 17,042 -
Mumbai)
Fixed Deposits Balance as at 31 March 63,00,000 -
2013 & 2012
Accrued Interest on Fixed Deposit as at 15,337 -
31 March 2013 & 2012
Mr. Vishwas Pathak Gross Remuneration including 41,19,127 32,97,892
allowances, perquisites and
contribution to Provident Fund
Mr. L. Nandakumar Gross Remuneration including - 18,43,912st(upto 31 January, 2012 allowances, perquisites and
contribution to Provident Fund
3,73,759 23,68,828
(ii) Details of transactions with Related Parties are as follows: -
Name of the Related Party Particulars FY 2012 – 2013 FY 2011 - 2012
(Amount in Rupees)
Notes: -a) The Company has not entered into any transaction with other related parties.b) Related party relationships on the basis of Accounting Standard 18 (AS 18) as in (i) above are as given by the
Company and relied upon by the Auditors.
*Note: Consequent to the issuance of bonus shares as mentioned in Note 19.10, the calculation of basic and diluted earnings per share has been adjusted for the increase in the number of equity shares outstanding as a result of the issuance of bonus equity shares, for all the years presented.
19.7 Earnings Per equity share:
Particulars For the year ended31.03.2013
For the year ended31.03. 2012
a. ( Profit / Loss) attributable to equity shareholders' (Rs.) 7,51,99,546 5,82,55,198
b. Weighted average number of equity shares outstanding during 10,00,000 10,00,000*
the period (Nos.)
c. Basic/Diluted Earnings per equity share (a/b) (Rs.) 75.20 58.26
d. Face value of each equity share (Rs.) 10 10
NOTES TO THE PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2013
ANNUAL REPORT112 12-13
2012-13 2012-12
PV of Past Service Benefit 4,35,128 2,08,384
Current Service Cost 1,77,109 1,13,232
Total Service Gratuity 70,32,563 42,62,639
Accrued Gratuity 6,54,819 3,34,070
LCSA 37,52,478 28,36,720
LC Premium (A) 10,683 9,110
Service Tax @10.30% (B) 1,320 938
19.9
As per Accounting Standard 15 "Employee Benefits", the disclosure of Employee benefits as defined in theAccounting Standard are given below:
Defined Contribution Plan
Contribution to Defined Contribution Plan, recognised as expense for the year are as under:
(Amount in Rupees)
2012-13
Employer's Contribution to Provident Fund 7,37,048
(P.Y. 5,74,426)
Defined Benefit Plan
The Company has adopted the Group Gratuity Scheme of Life Insurance Corporation of India and annual contributions, determined by using actuarial valuation technique, has been paid to the scheme. Details of the same to the extent available from LIC of India are as follows:
Membership Data
19.8 Deferred Tax
Components of Net Deferred Tax (Liabilities)/Assets are as under:
(Amount in Rupees)
Particulars As at 31.03.2013 As at 31.03.2012
Preliminary expenses written off - 1622
Provision for doubtful debts 1,95,565 -
1,95,565 1622
Related to Fixed Assets 3,13,108 2,31,523
(1,17,543) (229,901)
Deferred Tax Asset
Total
Deferred Tax Liability
Net Deferred Tax Liability
2012-13 2011-12
Number of Members 25 19
Average Age 32.72 33.95
Average Monthly Salary 22,350.76 18,726.73
Average Past Service 1.40 1.26
Valuation Method: Projected Unit Credit Method
Actuarial Assumptions
Mortality Rate LIC (1994-96) ultimate
Withdrawal Rate 1% to 3% depending on age
Discount Rate 8% p.a.
Salary escalation 4%
Results of Valuation
(Amount in Rupees)
NOTES TO THE PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2013
ANNUAL REPORT 11312-13
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Recommended Contribution Rate
(Amount in Rupees)
Total Amount Payable
(Amount in Rupees)
Benefit Valued
At the Extraordinary General Meeting held on February 26, 2013, the shareholders approved the issue of 500,000 equity
shares of Rs. 10/ each fully paid up as bonus shares in the ratio of 1 equity share for every one equity share held by the
equity shareholders of the Company whose name appear in the register of members as on the record date, by
capitalization of Rs.50,00,000/- out of General Reserve. The Same were allotted on February 26, 2013.
Maximum obligation on lease rentals payable as per the lease agreement is as under:-
Trade Receivables balances as on March 31, 2013 are subject to confirmation and reconciliation, if any. However, the management does not expect any material variation.
Contingent Liabilities: Rs.Nil (Previous Year Rs.Nil).
Commitments: Estimated amount of contracts remaining to be executed on capital account not provided for Rs.Nil (Previous Year : Rs.Nil).
stThe management is of the opinion that there are no contingent liabilities and commitments outstanding as at 31 March 2013.
There were no outstanding dues to Micro, Small and Medium Enterprises.
19.10 Issue of Bonus Shares
19.11 Operating Lease:
19.12 Trade Receivables:
19.13
19.14
19.15
19.16
2012-13 2011-12
Fund Value as on Renewal Rate 3,42,507 2,29,868
Additional Contribution for existing fund © 92,621 -
Current service cost (D ) 1,77,109 91,748
2012-13 2011-12
Total Amount Payable (A+B+C+D) 2,81,733 1,01,796
Particulars As At 31.03.2013 As At 31.03.2012
(Rs.) (Rs.)
Not later than one year 31,51,920 61,77,600
Later than one year but not later than five years 29,47,120 15,44,400
Above five years - -
Category NRA Gratuity Ceiling Slab Rate LCSA Ceiling RTA TABLE
1 60 10,00,000 99 15 175,000 GG41
NOTES TO THE PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2013
ANNUAL REPORT114 12-13
NOTES TO THE PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2013
19.17 The previous year's figures have been reclassified, regrouped, rearranged and recasted to make them comparable with current year's figures and to conform to the format of requirement of Revised Schedule VI to the Companies Act 1956.
For KHANDELWAL JAIN & CO.
CHARTERED ACCOUNTANTS
Firms Registration No.: 105049W
V.G.Kannan Supratim Sarkar
Director Director
(S.S SHAH) Avinash Kulkarni V.Muralidharan
PARTNER Director Director
Membership No.: 33632
PLACE : MUMBAI Ajit Joshi
DATE : April 22, 2013 Company Secretary
As per our report of even date
For and on behalf of the Board of Directors
ANNUAL REPORT 11512-13
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SBICAPVENTURES LIMITED
ANNUAL REPORT116 12-13
DIRECTORS' REPORT FOR THE YEAR 2012-13
To,
The Members,
thYour Directors have pleasure in presenting the 8 Annual Report and the Audited Accounts of SBICAP Ventures Limited for stthe year ended 31 March 2013.
In order to bring uniformity in the names of the subsidiaries of SBI Capital Markets Limited, the name of the Company has been changed from SBICAPS Ventures Limited to SBICAP Ventures Limited.
During the year under review, the Company has made a net profit (after tax) of Rs.0.35 crores.
No dividend is proposed for the Financial Year 2012-13.
The Company has not accepted any deposits from Public during the year under review.
During the year under review, the following changes took place among Directors of the Company :-
th·Shri Rajeev Krishnan, President & COO, SBI Capital Markets Limited was appointed as Director w.e.f. 11 August, 2012.
th·Shri S. Vishvanathan resigned as Director w.e.f. 17 August, 2012, consequent to his repatriation to State Bank of India as Dy. Managing Director & GE.
·Smt. Arundhati Bhattacharya, Managing Director & CEO, SBI Capital Markets Limited was appointed as Director stw.e.f. 21 August, 2012.
th·Shri V. Muralidharan, Sr. Vice President & CFO, SBI Capital Markets Limited was appointed as Director w.e.f 18 October, 2012.
·Shri Shyamal Acharya, Dy. Managing Director & GE (Associates & Subsidiaries), State Bank of India, resigned as thDirector w.e.f. 29 November, 2012.
rd·Shri S. Vishvanathan, Managing Director & GE (A&S), State Bank of India, was appointed as Director w.e.f. 3 December, 2012.
th·Shri Rajeev Krishnan resigned as Director w.e.f. 15 December, 2012, consequent to his repatriation to State Bank of India as Chief General Manager (Stressed Assets Management - II).
th·Shri V. G. Kannan, President & COO, SBI Capital Markets Limited, was appointed as Director w.e.f. 8 January, 2013.
The Board places on record its deep appreciation of the valuable contributions made by Shri Shyamal Acharya and Shri Rajeev Krishnan during their tenure as Directors and extends a hearty welcome to Shri S. Vishvanathan, Smt. Arundhati Bhattacharya, Shri V. G. Kannan and Shri V. Muralidharan as Directors of the Company.
thShri V. Muralidharan, Director, will retire by rotation at the ensuing 8 Annual General Meeting. Shri V. Muralidharan, being eligible, has offered himself for re-appointment as Director liable to retire by rotation.
Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Directors confirm that :-
(i) in the preparation of the annual accounts, the applicable accounting standards have been followed;
(ii) appropriate accounting policies have been selected and applied consistently, and judgements and estimates that have been made are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company
st stas on 31 March 2013, including the profit or loss of the Company for the year ended 31 March, 2013;
(iii) proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; and
(iv) the annual accounts have been prepared on a going concern basis.
The Directors also wish to draw the attention of the Shareholders to the Report of the Auditors to the Shareholders by M/s. D.S.K. & Associates, the Statutory Auditors, on the financial accounts for the year ended March 31, 2013.
I. Change of name of the Company
II. Financial Results
III. Dividend
IV. Deposits
V. Directors
VI. Directors' Responsibility Statement
ANNUAL REPORT 11712-13
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DIRECTORS' REPORT (contd.)
VII. AuditorsM/s. Khimji Kunverji & Co., Chartered Accountants, resigned as Statutory Auditors of the Company. Accordingly, M/s. D. S. K. & Associates, Chartered Accountants, were appointed as Statutory Auditors of the Company by the
thMember of the Company at the Extra-ordinary General Meeting (EGM) held on 26 March, 2013 to hold the office thfrom the conclusion of the said EGM till the conclusion of the 8 Annual General Meeting.
M/s. D. S. K. & Associates, Chartered Accountants, who are the Company's Statutory Auditors, retire at the conclusion of th rd ththe 8 Annual General Meeting of the Company. The Board of Directors, at its 33 Meeting held on 15 April, 2013, has
recommended for re-appointment of M/s. D. S. K. & Associates, Chartered Accountants, as the Statutory Auditors of the th thCompany to hold office from the conclusion of the 8 Annual General Meeting upto the conclusion of the 9 Annual
General Meeting of the Company. The Company has received a Certificate from M/s. D.S.K. & Associates to the effect that their appointment, if made, would be within the limits prescribed under Section 224(1B) of the Companies Act, 1956.
In terms of the above Rules issued by the Central Government, the following information is furnished :-
Conservation of Energy and Technology AbsorptionSince the Company has not undertaken business activities during the year under review, there is no information to report under this head.
Foreign Exchange Earnings and OutgoDuring the year under review, the Company has neither earned nor expended any foreign exchange.
There is no information to report in terms of the Companies (Particulars of Employees) Rules, 1975.
The Board is grateful to State Bank of India and to the SBICAP family for providing every support during the year.
For and on behalf of the Board of Directors
(V. G. Kannan) (V. Muralidharan) Director Director
thDate :- 15 April, 2013
VIII. Companies (Disclosures of Particulars in the Report of the Board of Directors) Rules, 1988
IX. Particulars of Employees
X. Acknowledgement
ANNUAL REPORT118 12-13
INDEPENDENT AUDITor's REPORT FOR THE YEAR 2012-13
To the members of SBICAP Ventures Limited.
We have audited the accompanying financial statements of SBICAP Ventures Limited ('the Company'), which comprise the Balance Sheet as at 31 March 2013 and the Statement of Profit and loss and Cash flow statement for the year ended, a
summary of significant accounting policies and other explanatory information.
Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (“the Act”). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:
a. in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2013;b. in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; andc. in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.
1. As required by the Companies (Auditor's Report) Order, 2003 (“the Order”) issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:a. we have obtained all the information and explanations which to the best of our knowledge and belief were
necessary for the purposes of our audit;
b. in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;
c. the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account.
d. in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956;
e. on the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.
f. Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company
For D.S.K. & AssociatesChartered Accountants Firm Registration No.117710W
(Santosh T. Shinde)PartnerMembership No. 133613Mumbai, dated 15th April, 2013
ANNUAL REPORT 11912-13
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ANNEXURE TO THE AUDITOR'S REPORT
The Annexure referred to in paragraph 1 of the Auditors' report to the members of SBICAP Ventures Limited (the
Company) for the year ended March 31, 2013. We report that:
i. In respect of its Fixed Assets:
a. The Company has maintained proper records showing full particulars, including quantitative details and
situation of fixed assets.
b. As explained to us, the fixed assets have been physically verified by the management at reasonable intervals;
no material discrepancies were noticed on such verification.
c. In our opinion and according to the information and explanations given to us, no fixed asset has been
disposed during the year and therefore does not affect the going concern assumption.
ii. In respect of its inventories:
The company being an investing company, clause 4(ii) of the Order is not applicable to the company.
iii. In respect of Loans and advances given or taken:
a. The Company has neither granted nor taken any loans, secured or unsecured to or from companies, firms or
other parties covered in the register maintained under section 301 of the Companies Act, 1956.
b. Therefore other sub-clauses under this para are not applicable.
iv. The Company has neither purchased inventory and Fixed Assets nor sold goods and services during the year; hence
clause 4(iv) is not applicable to the Company.
v. According to the information provided and explanation given by the management, the Company has not executed
any transaction which is required to be entered in the register maintained in pursuance of section 301 of the Act.
vi. The Company has not accepted any deposits from the public and consequently, the directives issued by the Reserve
Bank of India, the provisions of Sections 58A and 58AA of the Companies Act, 1956 and the rules framed
thereunder are not applicable.
vii. In our opinion, the Company has an internal audit system commensurate with its size and the nature of its business.
viii. To the best of our knowledge and according to the information and explanations given to us, the Central
Government has not prescribed the maintenance of cost records under clause (d) of sub-section (1) of Section 209
of the Companies Act, 1956 in respect of services carried out by the Company.
ix.
a) According to the information and explanations given to us and on the basis of our examination of the books of
account, the Company is generally regular in depositing undisputed statutory dues including provident fund,
income-tax, sales-tax, customs duty, investor education and protection fund, wealth and any other statutory
dues during the year with the appropriate authorities. As explained to us, the Company did not have any dues
on account of employee state insurance, excise duty and cess etc.
b) According to the information and explanations given to us, no undisputed dues payable in respect of income-
tax, sales tax, wealth tax, customs duty and cess were outstanding at 31 March 2013 for a period of more than
six months from the date they became payable
c) According to the information and explanations given to us, there are no dues in respect of sales tax, income
tax, sales tax, customs duty, wealth tax, excise duty, and cess that have not been deposited with the
appropriate authorities on account of any dispute.
x. The accumulated losses of the Company are less than fifty percent of its net worth and it has not incurred cash
losses, in the preceding financial year and also in the current financial year.
xi. On the basis of our examination and according to the information and explanations given to us, the company has
not defaulted in repayment of dues to any bank or financial institution. The company has not obtained any
borrowings by way of debentures.
xii. The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures
and other securities
ANNUAL REPORT120 12-13
AUDITOR'S REPORT (contd.)
xiii. The Company is not a chit fund, nidhi, mutual benefit fund or a society.
xiv. In our opinion and according to the information and explanations given to us, the Company is not dealing or
trading in shares, securities, debentures and other investments.
xv. According to the information and explanations given to us, the Company has not given any guarantee for loans
taken by others from banks or financial institutions.
xvi. The company did not have any term loans outstanding during the year.
xvii. In our opinion, and on the basis of our examination and according to the information and explanations given to
us, and on overall examination of the balance sheet of the company, we report that the company has not, prima
facie, used the funds borrowed on short term basis during the year for long term investment and vice versa.
xviii. The Company has not made any preferential allotment of shares to parties and companies covered in the
register maintained under section 301 of the Act.
xix. The Company does not have any outstanding debentures during the year.
xx. The Company has not raised any money by public issues during the year.
xxi. According to the information and explanations given to us, no fraud on or by the Company has been noticed or
reported during the year.
For D.S.K. & Associates
Chartered Accountants
Firm Registration No. 117710W
(Santosh T. Shinde)
Partner
Membership No. 133613
Mumbai, dated 15th April, 2013
ANNUAL REPORT 12112-13
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Balance Sheet NotesAs at
31-Mar-
As at
31-Mar-12
EQUITY AND LIABILITIES
2.1 41,620,000
15,220,062
41,620,00
0
2.2
Non-Current Liabilities - -
2.3 50,623 85,522
56,890,685 53,407,005
ASSETS
Non-current Assets
Fixed Assets
Tangible Assets
Non-current Investments
Long-term loans and advances
Other Non-Current Assets
2.4
2.5
2.6
2.7
3,636 4,224
-
1,065,463
12,616,67
-
18,900
14,691,084
2.8 40,830,953
1,346,112
37,421,46
3
2.9
42,177,065 39,720,639
56,890,685 53,407,005
Significant Accounting Policies & Notes to Accounts1 & 2 0
0 0
Notes referred to above form an integral part of the Accounts
As per our attached audit report of even date
For D SK & ASSOCIATESChartered Accountants
FOR AND ON BEHALF OF THE BOARDSBICAP Ventures Limited
Santosh T. Shinde
Partner
PLACE : MUMBAIDATE : 15/04/2013
(Amount in Rs.)
BALANCE SHEET AS AT 31ST MARCH 2013
ANNUAL REPORT122 12-13
Statement of Profit and Loss
(Amount in Rs.)
Statement of Profit and Loss
For the Year
ended
31-Mar-13
For the Year
ended
31-Mar-12
Notes
INCOME
Revenue from operations
Other Income
- -
2.10 4,712,571 5,101,017
Total 4,712,571 5,101,017
2.1
1
2.4
309,948 940,075
588 682
107,121 153,962
Total 417,657 1,094,719
PROFIT/(LOSS) BEFORE TAXATION
Current Tax Expenses
Shortfall of provision for tax in earlier years
MAT Credit created
Adjustment for :
4,294,914 4,006,298
1,327,133 1,694,430
1,614,835 -
(2,165,633) -
776,335 1,694,430
NET PROFIT/(LOSS) 3,518,579 2,311,868
Earnings per Equity Share
Basic/Diluted Earning Per Share (EPS) 0.85 0.46
/Diluted Earning Per Share (EPS) 0.96
Notes to Accounts
Notes referred to above form an integral part of the Accounts
As per our attached audit report of even date
For D SK & ASSOCIATESChartered Accountants
FOR AND ON BEHALF OF THE BOARDSBICAP Ventures Limited
Santosh T. Shinde
Partner
PLACE : MUMBAIDATE : 15/04/2013
ANNUAL REPORT 12312-13
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Statement of Cash Flow
(Amount in Rs.)
PARTICULARSFor the
Yearended
For the Yearended
31-Mar-12
A.
4,294,914 4,006,298
DepreciationProvision for diminution in value of investmentInterest received during the yearInterest Accrued
588 682
- -
(3,216,892) (2,853,221)
953,065 (2,247,796)
Operating Profit / (Loss) before Working Capital Changes 2,031,675(34,899)
(1,094,037)1,503
Increase/(Decrease) in Current Liabilities
Cash generated form operation 1,996,776 (1,092,534)(3,775,495)
Tax paid during the year (804,178)
NET CASH FROM OPERATING ACTIVITIES 1,192,598 (4,868,029)
B. CASH FLOW FROM INVESTMENT ACTIVITIES
Investments in
Fixed DepositInterest received during the year
1,868,152 1,622,977
3,216,892 2,853,221
NET CASH FROM INVESTING ACTIVITIES 5,085,044 4,476,198
C. CASH FLOW FROM FINANCING ACTIVITIES
Buy back of Equity Shares - (11,499,880)
NET CASH FROM FINANCING ACTIVITIES - (11,499,880)
NET INCREASE IN CASH AND CASH EQUIVALENTCASH AND CASH EQUIVALENT (OPENING BALANCE)CASH AND CASH EQUIVALENT (CLOSING BALANCE)
6,277,642 (11,891,711)
553,311 12,445,022
6,830,953 553,311
Notes:1) Cash and cash equivalents include:
B a lances with bank Fixed Deposit
6,830,953 553,311
-
6,830,953 553,311
2) Fixed Deposits Includes More than 3 Months Less than 3 Months
47,000,000 48,868,152
-
Total Fixed Deposits 47,000,000 48,868,152
3) Previous year's figures have been regrouped/ rearranged to confirm to the current year's presentation, whenever necessary
As per our attached audit report of even date
For D SK & ASSOCIATESChartered Accountants
FOR AND ON BEHALF OF THE BOARDSBICAP Ventures Limited
Santosh T. Shinde
Partner
PLACE : MUMBAIDATE : 15/04/2013
ANNUAL REPORT124 12-13
NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH 2013
(Amount in Rs.)
As at31-Mar-13
Rs.
As at
31-Mar-
12PARTICULARS
NOTE 2.1 : SHARE CAPITAL
Authorised
2,50,00,000 (PY: 2,50,00,000) Equity Shares of Rs.10 each 250,000,000
250,000,000
Issued, Subscribed & Paid up
41,62,000 (PY: 41,62,000) Equity Shares of Rs.10 each fully paid up(Of the above shares, 100% (PY: 100%) held by the holding companySBI Capital Markets Limited & its nominees)
41,620,000
41,620,000
41,620,000
41,620,000
The company has only one class of shares referred to as equity shares. Each holder of equity shares is entitled
to one vote per share.
a) Reconciliation of the shares outstanding at the beginning and at the end of the reporting period
Equity Shares
ParticularsNo. Rs. No. Rs.
At the beginning of the periodLess: Buy back during the year Outstanding at the end of the period
4,162,000 41,620,000 5,100,000 51,000,000
- - 938,000 9,380,000
4,162,000 41,620,000 4,162,000 41,620,000
NOTE 2.2 : RESERVES & SURPLUS
31-Mar-
13
Capital Redemption Reserve
Balance as per the last Financial Statements
Add : Transfer from Profit and Loss account
Closing Balance
9,380,000 -
9,380,000
9,380,000 9,380,000
Profit and loss account balance
Opening BalanceProfit during the year
2,321,483 11,509,495
3,518,579 2,311,868
Less : Appropriations
Amount utilised for buy back of shares Transfer to Capital Redemption Reserve
- 2,119,880
- 9,380,000
Closing Balance 5,840,062 2,321,483
TOTAL RESERVES AND SURPLUS 15,220,062 11,701,483
31-Mar-13 31-Mar-12
31-Mar-
13
NOTE 2.3 : OTHER CURRENT LIABILITIES
Sundry Creditors for Expenses (Refer note 2.15)
Others
44,450 76,969
6,173 8,553
50,623 85,522
PARTICULARS
As at
31-Mar-
13
As at
31-Mar-12
Rs.
ANNUAL REPORT 12512-13
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NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH 2013 (contd.)
(Am
ou
nt
in R
s)N
OTE
2.4
: F
IXED
ASSETS A
s at
01
.04
.20
12
Ad
dit
ion
sD
ed
uct
ion
s/
Ad
just
men
ts
As
at
31
.03
.20
13
As
at
01
.04
.20
12
Ad
dit
ion
sD
ed
uct
ion
s/
Ad
just
men
t
As
at
31.0
3.2
01
As
at
31.0
3.2
01
As
at
31.0
3.1
Off
ice e
qu
ipm
en
t8
,60
0
-
-
8,6
00
4,3
76
588
-
4,9
64
3,6
36
4,2
24
TO
TA
L8
,60
0
-
-
8,6
00
4,3
76
588
-
4,9
64
3,6
36
4,2
24
Tota
l (P
revi
ou
s ye
ar)
8,6
00
-
8,6
00
3,6
94
682
-
4,3
76
4,2
24
-
GRO
SS B
LOC
K
DEPR
EC
IATIO
N/A
MO
RTI
SA
TIO
NN
ET B
LOC
K
PARTIC
ULA
RS
ANNUAL REPORT126 12-13
NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH 2013 (contd.)
(Amount in Rs.)
PARTICULARS
As at
31-Mar-
13
As at
31-Mar-12
Rs.
NOTE 2.5 : NON CURRENT INVESTMENTS
NON-TRADE
(Long term, at cost unless otherwise stated)
Invetment in Equity Instruments (unquoted)
Aptivaa Consulting Solutions Private Limited
- 500 (March 2012: 500) Shares of Rs.10 each fully paid up
(At cost less provision other than temporary diminution in
value Rs. 3,48,075 (2012: Rs.3,48,075))
- -
Preference Shares (unquoted)
Aptivaa Consulting Solutions Private Limited
- 8,070 (March 2012: 8,070) Compulsorily Convertible Preference Shares
of Rs.10 each fully paid up
(At cost less provision other than temporary diminution in
value Rs. 56,17,930 (2012: Rs.56,17,930))
-
-
-
-
Aggregate of quoted investments:
(i) Cost
(ii) Market Value
(iii) Book Value
Aggregate of unquoted investments:
(i) Cost
(ii) Book Value
-
-
-
-
-
-
5,966,006
5,966,006
-
-
Aggegrate of provision for diminution in value of investments 5,966,006
5,966,006
NOTE 2.6 : LOANS AND ADVANCES
(Unsecured and considered good unless otherwise stated)
Other loans and advances
Taxes Paid (Advance Tax and TDS)
Taxes Paid FY 10-11
Taxes Paid FY 11-12
Taxes Paid FY 12-13
-
2,643,503
1,308,728
1,308,728
801,848
-
Less: Provision for Tax 2,091,676
2,886,768
Taxes Paid (Net) 18,900
1,065,463
NOTE 2.7 OTHER NON-CURRENT ASSETS
Deposits with maturity of more than twelve months 13,000,000
12,000,000
MAT Credit Entitlement 2,165,633
616,679
Less : MAT Credit availed for AY 2012-2013 474,549
-
1,691,084
616,679
14,691,084
12,616,679
ANNUAL REPORT 12712-13
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NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH 2013 (contd.)
(Amount in Rs.)
PARTICULARS
As at
31-Mar-
13
As at
31-Mar-12
Rs.
NOTE 2.8 : CASH AND CASH EQUIVALENTS
Cash and cash equivalents
Balances with banks
Current Account
Deposits with original maturity of less than three months
6,830,953 553,311
- -
6,830,953 553,311
Other Bank Balances
Deposits with maturity of more than twelve months
Deposits with maturity of more than three months but less than twelve months
13,000,000 12,000,000
34,000,000 36,868,152
47,000,000 48,868,152
Less : Amount disclosed under non-current assets 13,000,000 12,000,000
40,830,953 37,421,463
NOTE 2.9 : OTHER CURRENT ASSETS
Interest Accrued 1,346,112 2,299,176
1,346,112 2,299,176
(Amount in Rs.)
PARTICULARSAs at
31-Mar-13
As at
31-Mar-12
NOTE 2.10 : OTHER INCOME
Profit on Sale of Investments
Interest on FDR
- - 4,712,571 5,101,017 4,712,571 5,101,017
NOTE 2.11 : EMPLOYEE COST
Salaries and Allowances
Contribution to Provident and Other Fund
Leave Travel Expenses
Contribution to Pension
Medical Expenses
281,808
11,945
9,435
2,042
4,718
854,275
34,308
30,000
6,492
15,000
309,948 940,075
NOTE 2.12 : OTHER EXPENSE
Auditor's Remuneration (Refer Note No 2.14)
Legal & Professional Fees
Profession Tax
Rates and Taxes
Bank Charges
Directors Sitting Fees
Other Expense
44,944
21,186
2,500
29,899
163
7,500
929
82,022
45,220
2,500
6,590
2,630
15,000
-
107,121 153,962
ANNUAL REPORT128 12-13
2.13) (Amount in Rs)
31/03/2013 3/31/2012
30,00
0
10,00
0
58,000
15,000
9,022
82,022
2.15)
Name of Related PartyNature of
Relationship
a) SBI Capital Markets Ltd.
b) State Bank of India Ultimate
Holding
Nature of Transaction Ultimate Holding Company
3/31/2013 3/31/2012 3/31/2013 3/31/2012
1) Expenses
Deputation Cost
Bank Charges
2) Income
Dividend
Interest on FDR
2) Assets
a) Investments
b) Bank Account
Deposit with Bank
309,948
940,075
163
2,630
4,712,571
5,101,017
6,830,953
553,311
47,000,000
48,868,152
1,346,112 2,299,176
2.18) There is no contingent liability as at 31 March 2013 (Nil as at 31 March 2012).
2.20)
2.22) The Company has not recognized Deffered Tax Asset on Carried Forward Losses on the basis of prudence.
Notes referred to above form an integral part of the Accounts
For DSK & ASSOCIATES
Chartered AccountantsFOR AND ON BEHALF OF THE BOARD
SBICAP Ventures Limited
Santosh T. Shinde
Partner
Membership No. 133613
PLACE : MUMBAI
DATE : 15/04/2013
10
3/31/2013
I Profit/(Loss) after tax
II Basic and diluted EPS (Rs.)
III Nominal value per share (Rs.)
IV Weighted average number of equity shares
Particulars
2.16) Transactions with related party:
Total
Audit Fees
For other matters
Service Tax
3/31/2012
0.46
0.85
Particulars
3,518,579
2,311,868
2.19) Segment information
2.21) The figures for the previous year have been regrouped/rearranged wherever necessary.
4,162,000
4,914,970
No other information under para 3, 4C and 4D of Part II of Schedule VI of The Companies Act, 1956 is applicable
to the
The operations of the Company fall under single business and geographical segment, hence no additional
disclosure is
The Company has made a buy-back of 9,38,000 Equity Shares from SBI Capital Markets Ltd. in the financial year 2011-2012 which was approved by the Board at its Meeting held on 18th January, 2012, and thereafter by the Shareholders of the Company at the Extra-ordinary General Meeting held on 18th January, 2012.
As at 31 March 2013, no amount is outstanding in respect of the any enterprises covered under The Micro, Small
and Medium Enterprise Development Act, 2006.
10
2.17) Earnings per equity share (EPS)
Holding Company
2.14) Payment to Auditors
NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH 2013 (contd.)
ANNUAL REPORT 12912-13
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(1) Significant Accounting Policies
1. Accounting Convention
2. Use of estimates
3. Revenue Recognition
4. Fixed Assets
5. Depreciation/ Amortisation
6. Investments
7. Translation of Foreign Currency Items
8. Retirement Benefits
9. Taxation
The financial Statements have been prepared under the historical cost convention on an accrual basis in compliance with all material aspect of the applicable Accounting Standards in India and the relevant provisions of the Companies Act, 1956. Except otherwise mentioned, the accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. Although these estimates are based upon management's best knowledge of current events and actions, actual results could differ from these estimates.
Revenue is recognized to the extent that it is probable that economic benefits will flow to the Company and revenue can be easily measured. Dividend income on investments is accounted for when the right to receive the payment is established.
Fixed assets are stated at cost less accumulated depreciation and impairment if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use.
Depreciation on fixed assets is provided on Written down Value Method at the rates and in the manner specified in the Schedule XIV of the Indian Companies Act, 1956. Depreciation in Fixed Assets added / disposed of / discarded during the year has been provided on prorata basis with reference to the date of addition / disposition / discardation.
Current Investments are stated at lower of cost and market/fair value. Long Term Investments are stated at cost after deducting provision made, if any, for other than temporary diminution in the value.
Transactions in foreign currency are recorded at the rate of exchange prevailing on the date of transaction. Foreign currency monetary items are reported using closing rate of exchange at the year end. The resulting exchange gain/loss is reflected in the profit and loss account. Other items, like fixed assets, investments in equity shares are carried in terms of historical cost using the exchange rate at the date of transaction.
The Company makes defined contribution to Provident Fund which is recognized in the Profit and Loss Account on accrual basis.
Provision for current tax is made on the basis of estimated taxable income for the current accounting year in
accordance with the Income Tax Act, 1961.
Deferred tax for timing differences between the book and tax profits for the year is accounted for, using the prevailing enacted or substantially enacted tax rates and laws as of the Balance Sheet date. Deferred tax assets arising from timing differences are recognised to the extent there is reasonable certainty that these would be realized in future. Deferred tax assets in case of unabsorbed losses and unabsorbed depreciation are recognised only if there is virtual certainty that such deferred tax asset can be realized against future taxable profits.
NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH 2013 (contd.)
ANNUAL REPORT130 12-13
10. Contingent Liabilities
11. Earnings per share
12. Provisions
13. Cash and Cash equivalents
Contingent liabilities are possible but not probable obligation as on Balance Sheet date, based on available evidences. Provisions are recognised when there is a present obligation, as a result of past event, and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are determined based on best estimate required to settle the obligation at the Balance Sheet date.
Basic and diluted earnings per share are reported in accordance with AS 20, “Earnings Per Share”. Basic earnings per equity share has been computed by dividing net profit after tax by weighted average number of equity shares outstanding for the year. Diluted earnings per equity share have been computed using the weighted average number of equity shares and dilutive potential equity shares outstanding during the year.
A provision is recognised when an enterprise has a present obligation as a result of past event; it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.
Cash and cash equivalents in the balance sheet comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.
NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH 2013 (contd.)
ANNUAL REPORT 13112-13
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SBICAP (UK)LIMITED
ANNUAL REPORT132 12-13
DIRECTORS
SECRETARY
REGISTERED OFFICE
REGISTERED NUMBER
AUDITORS
: Madhumita ChatterjeeMrutyunjay MahapatraArundhati Bhattacharya V G KannanBharati Rao S Vishvanathan
: Temple Secretarial Limited
: 7th Floor, 29 - 30 Cornhill, London, EC3V 3NF
: 05461622 (England and Wales)
: Haines Watts Slough LLPStatutory AuditorSterling House 177 - 181 Farmham Road, Slough SL 1 4XP
COMPANY INFORMATION FOR THE YEAR ENDED 31ST MARCH 2013
ANNUAL REPORT 13312-13
SB
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Report of the the DirectorsFor the year ended 31st March 2013
The directors present their report with the financial statements of the company for the year ended 31st March 2013
The principal activity of the company in the year under review was that of the arrangement of Corporate Finance and
providing Advisory Services.
For the financial year 2012-13, the Company has achieved a Turnover of (excluding interest income) of GBP 1,903,461 vis-
a-vis the previous year level of GBP 1,184,676 and PAT of GBP 1,164,337 as against the PAT of GBP 6,35,328 booked
during the previous year. Amongst all the assignments that the Company has handled during this financial year, two
major deals deserve mention. One was arranging part-acquisition finance for the Hindujas for its acquisition of
Houghton International, USA. The other significant achievement for SBICAP UK was lead managing the covered bond
issuance of AERH BV Netherlands, an Indirect Subsidiary of Suzlon. These two signature deals contributed substantially
not only to the bottom line but also in terms of the Company's International visibility and investor connect. Apart from
these, the Company has also arranged successful investor roadshows under OFS mandates and has achieved profit by
way of executing various India related project finance and corporate advisory mandates including FCCB Buybacks during
this year.
During the financial year 2013-14, the Company proposes to concentrate on the activites such as arranging ECBs,
Managing Foreign Currency Debt and Equity Issuances of Indian Corporates in the International Capital Market,
Placement of Local Currency Equity and debt issuances of Indian Corporates, FCCB (Issue / Buyback), along with M&A
Advisory services and Institutional broking.
No dividends will be distributed for the year ended 31st March 2013.
The directors shown below have held office during the whole of the period form 1st April 2012 to the date of this report.
Madhumita Chatterjee
Bharati Rao
Other changes in directors holding office are as follows:
Mrutyunjay Mahapatra - appointed 16th August 2012
Arundati Bhattacharya - appointed 3rd December 2012
V G Kannan - appointed 24th January 2013
S Vishvanathan - appointed 15th January 2013
R Kumar - resigned 18th April 2012
S Acharya - resigned 15th January 2013
The directors are responsible for prepariing the Report of the Directors and the financial statements in accordance with
applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors
have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting
Practise (United Kingdom Accounting Standards and applicable law). Under company law the directors must not
approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the
company and of the profit or loss of the company for that period. In preparing these financial statments, the directors
are required to :
n Select suitable accounting policies and then apply them consistently :
n Make judgements and accounting etimates that are reasonable and prudent:
n prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company
will continue in business.
Principal Activity
Review of Business
Dividends
Directors
Statement of Directors Responsibilities
ANNUAL REPORT134 12-13
Statement of Directors' Responsibilities - continued
Statement as to disclosure of information to auditors
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the
company's transactions and disclose with reasonable accuracy at any time the financial position of the company and
enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for
safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection and
fraud and other irregularities.
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act
2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have
taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the
Company's auditors are aware of that information.
On behalf of the board :
Madhumita Chatterjee - Director
Date : 12th April, 2013
Report of the the DirectorsFor the year ended 31st March 2013
ANNUAL REPORT 13512-13
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REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF SBICAP (UK) LIMITED
We have audited the financial statements of SBICAP (UK) Limited for the year ended 31st March 2013 on pages five to
ten. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom
Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies
ACt 2006. Our audit work has been undertaken so that we might state to the company's member those matters we are
required to state to them in Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do
no accept or assume responsibility to anyone other than the company and the company's members as a body, for our
audit work, for this report or for the opinions we have formed.
As explained more fully in the Statement of Director's Responsibilities set out on pages two and three, the directors are
responsible for the preparation fo the financial statements and for being satisfied that they give a true and fair view. Our
responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and
International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices
Board's Ethical Standards for Auditors.
An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give
reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or
error. This includes an assessment of: whether the accounting policies are appropriate to the company's circumstance
and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates
made by the directors; and the overall presentation of the financial statements. In addition, we read all the financial and
non-financial information in the Report of the Directors to identify material Inconsistencies with the audited financial
statements. If we become aware of any apparent material misstatements or inconsistencies we consider the implications
for our report.
In our opinion the financial statements:
ngive a true and fair view of the state of the company's affairs as at 31st March 2013 and of its profit for the year then
ended;
nhave been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
nhave been prepared in accordance with the requirements of the Companies Act 2006.
In our opinion the information given in the Report of the Directors for the financial year for which the financial statements
are prepared is consistent with the financial statements.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you
if, in our opinion:
n adequare accounting records have not been kept, or returns adequate for our audit have not been received from
branches not visited by us; or
n the financial statements are not in agreement with the accounting records and returns; or
n certain disclosures of directors' remuneration specified by law are not made; or
nwe have not received all the information and explanations we require for our audit.
Kalbinder Sanghera (Senior Statutory Auditor)
for and on behalf of Haines Watts Slough LLP
Statutory Auditor
Sterling House
177 - 181 Farnham Road
Slough
SL1 4XP
Date : 12th April 2013
Respective responsibilities of directors and auditors
Scope of the audit of the financial statements
Opinion on financial statements
Opinion on other matter prescribed by the Companies Act 2006
Matters on which we are required to report by exception
ANNUAL REPORT136 12-13
PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31st March 2013
TURNOVER
OPERATING PROFIT
PROFIT ON ORDINARY ACTIVITIES
BEFORE TAXATION
PROFIT FOR THE FINANCIAL YEAR
CONTINUING OPERATIONS
TOTAL RECOGNISED GAINS AND LOSSES
1,903,461 1,184,676
Administrative expenses (411,273) (339,749)
3 1,492,188 844,927
Interest receivable and similar income 4 40,335 14,655
1,532,523 859,582
Tax on profit on ordinary activities 5 (368,186) (224,254)
1,164,337 635,328
None of the company’s activities were acquired or discontinued during the current year or previous year.
The company has no recognised gains or losses other than the profits for the current year or previous year.
31/3/12Notes 31/3/13
The notes on pages 7 to 10 form part of the financial statements
ANNUAL REPORT 13712-13
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balance sheet 31st march 2013
The notes on pages 7 to 10 form part of the financial statements
FIXED ASSETS
Current Assets
CREDITORS
NET CURRENT ASSETS
TOTAL ASSETS LESS CURRENT LIABILITIES
CAPITAL AND RESERVES
SHAREHOLDERS’ FUNDS
Tangible assets 6 15,553 18,027
Debtors 7 36,909 40,119Cash at bank 2,998,427 1,673,998
3,035,336 1,714,117
Amounts falling due within one year 8 (424,423) (270,015)
2,610,913 1,444,102
2,626,466 1,462,129
Called up Share Capital 10 200,000 200,000Profit and loss account 11 2,426,466 1,262,129
15 2,626,466 1,462,129
The financial statements were approved by the board of Directors on 12th April, 2013 and were signed on its behalf by :
Madhumita Chatterjee - Director
31/3/12Notes 31/3/13
ANNUAL REPORT138 12-13
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH 2013
1.
Financial reporting standard number 1
Turnover
Tangible fixed assets
Deferred tax
Foreign currencies
Hire purchase and leasing commitments
Pension costs and other post-retirement benefits
2. STAFF COSTS
ACCOUNTING POLICIESAccounting convention
The financial statements have been prepared under the historical cost convention.
Exemption has been taken from preparing a cash flow statement on the grounds that the company qualifies as a small company.
Turnover represents net invoiced sales of services, excluding value added tax. Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.
Short leasehold - at variable rates on reducing balance Fixtures and fittings - at variable rates on reducing balance
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance
sheet date. Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance
sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.
Rentals paid under operating leases are charged to the profit and loss account on a straight line basis over the period of the lease.
The company operates a defined contribution pension scheme. Contributions payable to the company’s pension sheme are charged to profit and loss account in the period to which they relate.
31/3/13 31/3/12
Wages and salaries 128,513 87,090 Social security costs 6,699 34,219 Other pension costs 10,748 2,112
145,960 123,421
The average monthly number of employees during the year was as follows:
31/3/13 31/3/12
Management 1 1 Operations 2 2
3 3
ANNUAL REPORT 13912-13
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31st March 2013 (contd.)
3. OPERATING PROFIT
4. INTEREST RECEIVABLE AND SIMILAR INCOME
5. TAXATIONAnalysis of the tax charge
Factors affecting the tax charge
The operating profit is stated after charging/( crediting ):
31/3/13 31/3/12
Other operating leases 53,982 53,982Depreciation - owned assets 3,805 4,087Auditors’ remuneration 4,850 4,850Foreign exchange differences (652) (419)
Directors’ remuneration 62,256 66,166
31/3/13 31/3/12
Deposit account interest 40,335 14,655
The tax charge on the profit on ordinary activities for the year was as follows:
31/3/13 31/3/12
Current tax:UK corporation tax 368,186 224,254
Tax on profit on ordinary activities 368,186 224,254
The tax assessed for the year is higher than the standard rate of corporation tax in UK. Thedifference is explained below:
31/3/13 31/3/12
Profit on ordinary activities before tax 1,532,523 859,582
Profit on ordinary activitiesmultiplied by the standard rate of corporation taxin the UK of 24% (2012 - 26%) 367,806 223,491
Effects of:Expenses not deductible for tax purposes 70 208Depreciation in excess of capital allowances 310 555Current tax charge 368,186 224,254
ANNUAL REPORT140 12-13
NOTE TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31st March 2013 (contd.)
Short leasehold Fixtures and fitting Totals
At 1st April 2012 39,487 1,381 40,868
Additions - 1,331 1,331
At 31st March 2013 39,487 2,712 42,199
At 1st April 2012 21,889 952 22,841
Change for year 3,185 620 3,805
At 31st March 2013 25,074 1,572 26,646
At 31st March 2013 14,413 1,140 15,553
At 31st March 2012 17,598 429 18,027
31/3/13 31/3/12
Trade debtors 3,086 2,248
Other debtors 3,230 13,958
VAT 3,428 2,792
Prepayments and accrued Income 27,165 21,121
36,909 40,119
31/3/13 31/3/12
Corporation tax 368,186 224,254
Social security and other taxes 26,085 24,181
Accruals and deferred income 30,152 21,580
424,423 270,015
The following operating lease payments are committed to be paid within one year:
Land and Buildings
31/3/13 31/3/12
Expiring:
Between one and five years 53,982 53,982
6. TANGIBLE FIXED ASSETS
COST
DEPRECIATION
NET BOOK VALUE
7. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
8. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
9. OPERATION LEASE COMMITMENTS
Short leasehold Fixtures and fittings Total
ANNUAL REPORT 14112-13
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NOTE TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31st March 2013 (contd.)
Allotted, issued and fully paid:
Number: Class: Nominal 31/3/13 31/3/12
Value:
200,000 Ordinary 1 200,000 200,000
Profit and loss account
At 1st April 2012 1,262,129
Profit for the year 1,164,337
At 31st March 2013 2,426,466
The immediate parent company is SBI Capital Markets Limited, a company incorporated in India.
During the year, the company paid expenses of 3,044 (2012: 590) on behalf of SBI Capital Markets Limited,
its Immediate parent. At the year end, 2,099 (2012: nil) was owed by SBI Capital Markets Limited to the
company.
The ultimate parent company is State Bank of India, a company incorporated in India.
31/3/13 31/3/12
Profit for the financial year 1,164,337 635,328
1,164,337 635,328
Opening shareholders’ Fund 1,462,129 826,801
2,626,466 1,462,129
10.CALLED UP SHARE CAPITAL
11.RESERVES
12.ULTIMATE PARENT COMPANY
13.RELATED PARTY DISCLOSURES
14.ULTIMATE CONTROLLING PARTY
15.RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS’ FUNDS
Net addition to shareholders’ funds
Closing Shareholders’ funds
ANNUAL REPORT142 12-13
PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH 2013
31/3/13 31/3/12
1,903,461 1,184,676
Other income
Deposit account interest 40,335 14,655
1,943,796 1,199,331
Wages 93,303 50,924
Social security 6,699 34,219
Pensions 10,748 2,112
Rent 53,982 53,982
Service charges 17,661 20,797
Insurance 1,086 1,783
Light and heat 2,989 4,990
Officers residence rent 58,231 57,616
Directors’ salaries 35,210 36,166
News distribution 1,926 3,663
Telephone 7,095 6,880
Post and stationery 1,652 1,301
Travelling 21,675 15,321
Repairs and renewals 92 2070
Canteen and cleaning 2,097 2,836
Sundry expenses 593 839
Regulatory fees and levies 1,331 4,838
Subscriptions 24,275 1,904
Training 1,195 5,673
Professional fees 51,146 15,052
Work permit applications 500 700
Auditors’ remuneration 4,850 4,850
Foreign exchange losses (652) (419)
Entertainment 291 802
Seminars and conventions 9,322 6,478
407,297 335,377
1,536,499 863,954
Bank charges 171 284
1,536,328 863,670
Short leasehold 3,185 3,902
Fixtures and fittings 620 186
3,805 4,088
1,532,523 859,582
Sales
Expenditure
Finance cost
Depreciation
Net Profit
This page does not form part of the statutory financial statements
ANNUAL REPORT 14312-13
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SBICAP (SINGAPORE)LIMITED
ANNUAL REPORT144 12-13
We are pleased to submit this annual report to the member of the Company together with the audited financial statements for the financial year ended 31st March 2013.
The directors in office at the date of this report are as follows:
According to the register kept by the Company for the purposes of Section 164 of the Singapore Companies Act, Chapter 50 (the Act), particulars of interests of directors who held office at the end of the financial year (including those held by their spouses and infant children) in shares, debentures, warrants and share options in the Company and in related corporation are as follows:
Directors
Directors' interests
Arundhati Bhattacharya
State Bank of India –
Ultimate Holding Company
- Ordinary shares INR 10 each 200 200
SBI Capital Markets Limited –
Immediate Holding Company
- Ordinary shares INR 10 each (held as
nominee of State Bank of India) 8 6
Except as disclosed in this report, no director who held office at the end of the financial year had interests in shares, debentures, warrants or share options of the Company or of related corporations, either at the beginning of the financial year (or date of appointment, if later) or at the end of the financial year.
Neither at the end of, nor at any time during the financial year, was the Company a party to any arrangement whose objects are, or one of whose objects is, to enable the directors of the Company to acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate.
Except for salaries, bonuses and fees and those benefits that are disclosed in this report and in note 10 to the financial statements, since the end of the last financial year, no director has received or become entitled to receive, a benefit by reason of a contract made by the Company or a related corporation with the director, or with a firm of which he is a member or with a company in which he has a substantial financial interest.
Except as disclosed in this report, no director who held office at the end of the financial period had interests in shares, debentures or options of the Company or of related corporations either at the beginning or at the end of the financial period.
Neither at the end of nor at any time during the financial period was the Company a party to any arrangement whose objects are, or one of whose objects is, to enable the directors of the Company to acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate.
The auditors, KPMG LLP, have expressed their willingness to accept appointment.
Signed by the Board of Directors
M Rajaram Ravi ShankarDirector Director 26 April 2013
Director's contractual benefits
Auditors
M Rajaram
Ravi Shankar
Arundhati Bhattacharya (Appointed on 21 August 2012)
Holdings at end of
the year
Holdings at date of appointment /
beginning of the year
Name of director and corporation
in which interests are held
Directors' Report
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Statement by Directors
In our opinion:
(a) the financial statements set out on pages FS1 to FS14 are drawn up so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2013 and the results, changes in equity and cash flows of the Companyfor the year ended on that date in accordance with the provisions of the Singapore Companies Act, Chapter 50 and Singapore Financial Reporting Standards; and
(b) at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay itsdebts as and when they fall due.
The Board of Directors has, on the date of this statement, authorised these financial statements for issue.
Signed by the Board of Directors
M Rajaram Ravi Shankar
Director Director
26 April 2013
Directors' Report
ANNUAL REPORT146 12-13
Member of the Company SBICAP (Singapore) Limited
We have audited the accompanying financial statements of SBICAP (Singapore) Limited (the “Company”), which comprise the statement of financial position of the Company as at 31st March 2013, the statement of comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information, as set out on pages FS1 to FS14.
Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the provisions of the Singapore Companies Act, Chapter 50 (the Act) and Singapore Financial Reporting Standards, and for devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair profit and loss accounts and balance sheets and to maintain accountability of assets.
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation of financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
In our opinion, the financial statements are properly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards to give a true and fair view of the state of affairs of the Company as at 31 March, 2013 and the results, changes in equity and cash flows of the Company for the year ended on that date.
The financial statements of the Company for the year ended 31 March, 2012 were audited by another auditor who expressed an unmodified opinion of those statements on 4 May, 2012.
In our opinion, the accounting and other records required by the Act to be kept by the Company have been properly kept in accordance with the provisions of the Act.
KPMG LLP
Public Accountants and
Certified Public Accountants
Singapore
26 April 2013
Report on the financial statements
Management's responsibility for the financial statements
Auditors' responsibility
Opinion
Other matter
Report on other legal and regulatory requirements
Independent auditors' report
ANNUAL REPORT 14712-13
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Statement of financial position As at 31 March 2013
S$
Plant and equipment 4 1,535 2,002
Trade and other receivables 5 73,798 31,130
Cash and cash equivalents 6 1,015,726 35,221
1,089,524 66,351
1,091,059 68,353
Share capital 7 2,000,000 300,000
Accumulated losses (940,347) (249,149)
1,059,653 50,851
Accrued operating expenses 31,406 17,502
31,406 17,502
1,091,059 68,353
S$
Non-current asset
Current assets
Total assets
Equity
Total equity
Current liability
Total liability
Total equity and liability
Note 2013 2012
The accompanying notes form an integral part of these financial statements.
ANNUAL REPORT148 12-13
S$
Operating expenses 8
(691,198) (249,099)
Income tax expense 9 - -
(691,198) (249,099)
Other comprehensive income, net of tax - -
(691,198) (249,099)
S$
(691,198) (249,099)
Loss before income tax
Loss for the year
Total comprehensive loss for the year
Note 2013 2012
Statement of COMPREHENSIVE INCOMEYEAR ENDED 31 MARCH 2013
The accompanying notes form an integral part of these financial statements.
ANNUAL REPORT 14912-13
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Statement of changes in equity Year ended 31 March 2013
S$
At 1 April 2011 10,000 (50) 9,950
Loss for the year - (249,099) (249,099
Other comprehensive income - - -
- (249,099) (249,099)
Issue of ordinary shares 7 290,000 - 290,000
Total transactions with owners 290,000 - 290,000
At 31st March, 2012 300,000 (249,149) 50,851
At 1 April 2012 300,000 (249,149) 50,851
Loss for the year - (691,198) (691,198)
Other comprehensive income - - -
- (691,198) (691,198)
Issue of ordinary shares 7 1,700,000 - 1,700,000
Total transactions with owners 1,700,000 1,700,000
Total transactions with owners at 31st March 2013 2,000,000 (940,347) 1,059,653
S$ S$
Total comprehensive loss for the year
Transactions with owners, recorded directly
in equity
Contributions by owners
Total comprehensive loss for the year
Transactions with owners, recorded
directly in equity
Contributions by owners
Note Share capital TotalAccumulated
losses
The accompanying notes form an integral part of these financial statements.
ANNUAL REPORT150 12-13
Statement of cash flowsYear ended 31 March 2013
The accompanying notes form an integral part of these financial statements.
S$
Loss before income tax (691,198) (249,099)
Adjustments for:
Depreciation of plant and equipment 3,536 2,001
(687,662) (247,098)
Changes in working capital:
Trade and other receivables (42,668) (31,130)
Accrued operating expenses 13,904 17,502
(716,426) (260,726)
Acquisition of plant and equipment (3,069) (4,003)
(3,069) (4,003)
Proceeds from issue of share capital 1,700,000 290,000
1,700,000 290,000
980,505 25,271
Cash and cash equivalents at beginning of year 35,221 9,950
1,015,726 35,221
S$
Cash flows from operating activities
Net cash flows used in operating activities
Cash flows from investing activities
Net cash flows used in investing activities
Cash flows from financing activities
Net cash flows from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at end of year
Note 2013 2012
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These notes form an integral part of the financial statements.
The financial statements were authorised for issue by the Board of Directors on 26 April 2013.
SBICAP (Singapore) Limited (the “Company”) is incorporated in the Republic of Singapore and has its registered office at 10 Collyer Quay, Ocean Financial Centre #37-38/39, Singapore 049315.
The principal activities of the Company are those relating to business and management consultancy services.
On 30 November 2012, the Company obtained the Capital Markets Services Licence (the “CMSL”) under the Securities and Futures Act (the “SFA”) issued by the Monetary Authority of Singapore (the “MAS”) to conduct theregulated activity of dealing in securities as defined in the Second Schedule to the SFA.
The immediate holding company during the financial year is SBI Capital Markets Limited, which is incorporated inMumbai, India. The ultimate holding company during the financial year is the State Bank of India, which is alsoincorporated in India.
2.1 Statement of compliance
The financial statements have been prepared in accordance with Singapore Financial Reporting Standards (FRS).
2.2 Basis of measurement
The financial statements have been prepared on the historical cost basis except as disclosed in the accounting policies below.
2.3 Functional and presentation currency
The financial statements are presented in Singapore dollars, which is the Company's functional currency.
2.4 Use of estimates and judgements
The preparation of the financial statements in conformity with FRSs requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.
The accounting policies set out below have been applied consistently to all periods presented in these financialstatements, and have been applied consistently by the Company.
3.1 Foreign currency transactions
Transactions in foreign currencies are translated to the functional currency of the Company at the exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated to the functional currency at the exchange rate at the reporting date. Foreign currency differences arising on retranslation are recognised in profit or loss.
Non-monetary assets and liabilities measured at cost in foreign currencies are retranslated using exchange rates at the date of the transactions. Non-monetary assets and liabilities measured at fair values in foreigncurrencies are retranslated to the functional currency at foreign exchange rate at the date the fair values were determined.
3.2 Plant and equipment
Plant and equipment are stated at cost less accumulated depreciation and impairment losses. Depreciation is recognised in the statement of comprehensive income on a straight-line basis over the estimated useful lives of each part of an item of plant and equipment.
(i) Recognition and measurement
Plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the asset.
The gain or loss on disposal of an item of plant and equipment is determined by comparing the proceeds from disposal with the carrying amount of the plant and equipment, and is recognised net within other income/other expenses in profit or loss.
(ii) Subsequent costs
The cost of replacing a component of an item of plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the component will flow to the Company, and its cost can be measured reliably. The carrying amount of the replaced component is derecognised. The costs of the day-to-day servicing of plant and equipment are recognised in profit or lossas incurred.
1 Domicile and activities
2 Basis of preparation
3 Significant accounting policy
Notes to the Financial Statements
ANNUAL REPORT152 12-13
(iii) DepreciationDepreciation is based on the cost of an asset less its residual value. Significant components of individual assets are assessed and if a component has a useful life that is different from the remainder of that asset, that component is depreciated separately.
Depreciation is recognised as an expense in profit or loss on a straight-line basis over the estimated useful lives of each component of an item of plant and equipment, unless it is included in the carrying amount of another asset.
Depreciation is recognised from the date that the plant and equipment are installed and are ready for use, or in respect of internally constructed assets, from the date that the asset is completed and ready for use.
The estimated useful lives for the current and comparative period are as follows:
Computer hardware 2 years
Assets less than SGD 500 are charged off in the same year in which they are purchased.
Depreciation methods, useful lives and residual values are reviewed at each financial year-end and adjusted, ifappropriate.
Non-derivative financial instruments
Non-derivative financial instruments comprise trade and other receivables, cash at bank and accrued operating expenses.
Non-derivative financial instruments are recognised initially at fair value plus, for instruments not at fair value through profit or loss, any directly attributable transactions costs. Subsequent to initial recognition, non-derivative financial instruments are measured at amortised cost using the effective interest method, less any impairment losses.
A financial instrument is recognised if the Company becomes a party to the contractual provisions of the instrument. Financial assets are derecognised if the Company's contractual rights to the cash flows from the financial assets expire or if the Company transfers the financial asset to another party without retaining control or transfers substantially all the risks and rewards of the asset. Regular way purchases and sales of financial assets are accounted for at trade date, that is, the date that the Company commits itself to purchase or sell the asset. Financial liabilities are derecognised if the Company's obligations specified in the contract expire or are discharged or cancelled.
Cash and cash equivalents comprise cash at bank.
Impairment of financial assets
A financial asset is assessed at each reporting date to determine whether there is any objective evidence that it is impaired. A financial asset is considered to be impaired if objective evidence indicates that one or more events have had a negative effect on the estimated future cash flows of that asset.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount, and the present value of the estimated future cash flows discounted at the original effective interest rate.
Individually significant financial assets are tested for impairment on an individual basis. The remaining financial assets are assessed collectively in groups that share similar credit risk characteristics.
All impairment loses are recognised in the statement of comprehensive income. An impairment loss is reversed if the reversal can be related objectively to an event occurring after the impairment loss was recognised.
Where the Company has the use of assets under operating leases, payments made under the leases are recognised in profit or loss on a straight-line basis over the term of the lease. Lease incentives receivedare recognised in profit or loss as an integral part of the total lease payments made.
Provisions are recognised when the Company has a present legal or constructive obligation as a result of past events and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation.
Defined contribution plans
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution plans are recognised as an employee benefit expense in profit or loss in the periods during which services are rendered by employees.
3.3 Financial instruments
3.4 Lease payments
3.5 Provisions
3.6 Employee benefits
Notes to the Financial Statements
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Short-term employee benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided. A liability is recognised for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.
Tax expense comprises current and deferred tax. Current tax and deferred tax is recognised in profit or loss except to the extent that it relates to a business combination, or items recognised directly in equity or in other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.
Deferred tax is not recognised for:
ntemporary differences on the initial recognition of assets or liabilities in a transaction that is not a businesscombination and that affects neither accounting nor taxable profit or loss;
ntemporary differences related to investments in subsidiaries, associates and jointly controlled entities to the extent that the Company is able to control the timing of the reversal of the temporary difference and it is probable that they will not reverse in the foreseeable future; and
ntaxable temporary differences arising on the initial recognition of goodwill.
The measurement of deferred taxes reflects the tax consequences that would follow the manner in which theCompany expects, at the end of the reporting period, to recover or settle the carrying amount of its assets andliabilities. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences whenthey reverse, based on the laws that have been enacted or substantively enacted by the reporting date.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to theextent that it is probable that future taxable profits will be available against which they can be utilised. Deferred taxassets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.
A number of new standards, amendments to standards and interpretations are effective for annual periods beginning 1 April 2012, and have not been applied in preparing these financial statements. None of these are expected to have a significant effect on the financial statements of the Company.
3.7 Tax
3.8 New accounting standards and interpretations not yet adopted
Notes to the Financial Statements
ANNUAL REPORT154 12-13
Notes to the Financial Statements
S$
Amount due from immediate holding company 7,041 -
Deposits 55,950 31,130
Loans and receivables 62,991 31,130
Prepayments 10,807 -
73,798 31,130
The amount due from holding company is unsecured, interest-free and repayable on demand. There is no allowance for doubtful debts arising from the outstanding balance.
S$
4. Plant and equipment
Computer
hardware
S$
At 1 April 2011 -
Additions 4,003
At 31 March 2012 4,003
At 1 April 2012 4,003
Additions 3,069
At 31 March 2013 7,072
At 1 April 2011 -
Depreciation charge for the year 2,001
At 31 March 2012 2,001
At 1 April 2012 2,001
Depreciation charge for the year 3,536
At 31 March 2013 5,537
At 1 April 2011 -
At 31 March 2012 2,002
At 31 March 2013 1,535
Cost
Accumulated depreciation
Carrying amount
5. Trade and other receivables
2013 2012
ANNUAL REPORT 15512-13
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S$
Fully paid ordinary shares, with no par value:
At 1 April 300,000 10,000
Issued during the financial year 1,700,000 290,000
At 31 March 2,000,000 300,000
The holder of ordinary shares is entitled to receive dividends as declared from time to time and is entitled to one vote per share at meetings of the Company. All shares rank equally with regard to the Company's residual assets.
During the year, the Company has issued 1,700,000 (2012: 290,000) ordinary shares of S$1.00 each. All issued shares are fully paid.
Capital management
The Company defines “capital” as including all components of equity plus any loans from its immediate holding company or its related corporations with no fixed terms of repayment. Trading balances that arise as a result of trading transactions with other group companies are not regarded by the Company as capital.
The Company's capital management policies are to diversify its sources of capital, to allocate capital efficiently, guided by the need to maintain a prudent relationship between available capital and the risks of its underlying businesses and to meet the expectations of key constituencies, including investors and regulators.
The capital management process, which is centrally supervised by senior management, includes periodic reviews of both the demand for and supply of capital. To maintain or adjust the capital structure, the Company may take certain actions like adjusting the amount of dividend payment and issuing new shares.
In obtaining the CMSL, the Company is also required to provide to MAS a Banker's Guarantee of S$100,000 which will remain in force as long as the Capital Markets Services License remains valid.
The Company has complied with the above regulatory requirement during the year.
There were no significant changes in the Company's approach to capital management during the year.
S$
6. Cash and cash equivalents
8. Loss before income tax
The following items have been included in arriving at loss before income tax:
7. Share capital
S$
Cash at bank and in hand 1,015,726 35,221
S$
S$
Salaries and related costs 314,560 131,957
Contributions to defined contribution plans 12,075 4,157
Operating lease expense 237,963 61,613
Depreciation of plant and equipment 3,536 2,001
S$
2013 2012
2012No. of shares
2012
2013No. of shares
2013
Notes to the Financial Statements
ANNUAL REPORT156 12-13
Notes to the Financial Statements
9. Income tax expense
S$
Loss before income tax (691,198) (249,099)
Tax calculated using Singapore tax rate of 17% (117,504) (42,347)
Deferred tax assets not recognised 117,504 42,347
- -
Deferred tax assets have not been recognised in respect of the following items:
S$
Reconciliation of effective tax rate
S$
Directors' remuneration comprised:
- Short-term employee benefits 150,403 54,837
S$
S$
Reimbursement of marketing expenses from holding company 7,041 -
S$
Other related party transactions
During the financial year, other than those disclosed elsewhere in the financial statements, there were the following significant related party transactions carried out based on terms agreed between the parties:
S$
Unutilised tax losses 940,297 249,099
The unutilised tax losses are subject to compliance with the Singapore Income Tax Act, Chapter 134 and agreement of the Comptroller of Income Tax. The deductible temporary differences do not expire under current tax legislation. D e f e r r e d tax assets are recognised only to the extent that it is probable that future taxable profits will be available against which the Company can utilise the benefits therefrom.
For the purpose of these financial statements, parties are considered to be related to the Company if the Company has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Company and the party are subject to common control or common significant influence. Related parties may be individuals or other entities.
Key management personnel compensation
Key management personnel of the Company are those persons having the authority and responsibility for planning, directing and controlling the activities of the entity. The Company considers directors of the Company to be the key management personnel of the Company. Remuneration paid to key management personnel included in staff costs is as follows:
S$
10. Significant related party transactions
2012
2012
2012
2012
2013
2013
2013
2013
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S$
2013
Accrued operating expenses 31,406 31,406 31,406
2012
Accrued operating expenses 17,502 17,502 17,502
Fair values
Cash and cash equivalents, amount due from immediate holding company, deposits and accrued operating expenses
The carrying amounts approximate fair values due to the relatively short term to maturity of these financial instruments.
S$ S$
The Company leases office and residential premises under operating lease. Lease terms do not contain restrictions on the Company activities concerning dividends, additional debt or entering into other leasing agreements. The lease contains renewal option at rental rates to be based on negotiations and prevailing market rates.
Overview
The Company has exposure to the following risks from its use of financial instruments:
n credit risk
nliquidity risk
The exposure to each of the above risks arises in the normal course of the Company's business. The financial risk management approach of the Company seeks to minimise the potential material adverse effects from these exposures.
The Company is not exposed to any significant currency risk at the date of the statement of financial position as all of its financial assets and financial liabilities are denominated in the Company's functional currency. There are no interest-bearing assets or interest-bearing liabilities at the statement of financial position date.
Credit risk
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations. At the statement of financial position date, the maximum exposure to credit risk is represented by the carrying amount of each financial asset on the statement of financial position.
Cash is placed with a financial institution which is regulated.
Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company's approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company's reputation.
The following are the contractual maturities of the Company's financial liability, including estimated interest payments and excluding the impact of netting agreements:
12. Financial risk management
Within 1 year
Contractual cash flows
TotalCarrying amount
Total
S$
Within 1 year 236,752 70,150
Within 2 to 5 years 56,496 29,600
293,248 99,750
S$
11. Commitments
At 31 December, the Company has commitments for future minimum lease payments under non-cancellable operating lease as follows:
20122013
Notes to the Financial Statements
ANNUAL REPORT158 12-13
Location Telephone Fax Email
Regional Offices
Ahmedabad +91 (79)26560122 +91 (79)26565718 [email protected]
Bangalore +91 (80)25585471 +91 (80)25585478 [email protected]
Chennai +91 (44)28133801 +91 (44)28256244 [email protected]
Hyderabad +91 (40)23321605 +91 (40)23316800 [email protected]
Kolkata +91 (33)22886601 +91 (33)22886610 [email protected]
New Delhi +91 (11)23418460 +91 (11)23418773 [email protected]
Guwahati +91 (361)2237511 +91 (361)2237512 [email protected]
Pune +91 (020)66205548 +91 (020)25618003 [email protected]
SBICAP Securities Ltd. +91 (22)24473300 +91 (22)42273334 [email protected]
SBICAP Trustee Co. Ltd +91 (22)43025555 +91 (22)43025500 [email protected]
SBICAPS Ventures Ltd. +91 (22)22178300 +91 (22)22188332 [email protected]
SBICAP (UK) Ltd. +44 (20)79293529 +91 (20)79293529 [email protected]
SBICAP (Singapore) Ltd. +65 68086288 +65 68086299 [email protected]
Branch Offices
Subsidiaries
CONTACT US
ANNUAL REPORT 15912-13