Motilal Oswal Financial Services Ltd
Directors Reports
Dear Members,
The Directors of your Company have pleasure in presenting the Eighteenth Board's Report
together with the Audited Financial Statements for the financial year ended March 31,2023.
FINANCIAL RESULTS
The summary of the Company's financial performance, both on a consolidated and
standalone basis, for the financial year ("FY") 2022-23 and FY 2021-22 is given
below:
(? in Lakhs)
Particulars |
Consolidated |
Standalone |
|
2022-23 |
2021-22 |
2022-23 |
2021-22 |
Total Revenue |
4,19,712 |
4,31,641 |
2,69,271 |
2,61,546 |
Total Expense (Excluding Interest and Depreciation) |
2,30,066 |
2,17,757 |
1,70,002 |
1,55,041 |
Profit before Interest, Depreciation and Taxation |
1,89,646 |
2,13,884 |
99,269 |
106,505 |
Interest |
59,583 |
47,477 |
21,733 |
16,216 |
Depreciation |
5,838 |
4,826 |
5,006 |
3,876 |
Profit before taxation Add/ (Less): Provision for Taxation |
1,24,225 |
1,61,581 |
72,530 |
86,413 |
Current Tax |
29,062 |
23,588 |
15,829 |
14,807 |
Deferred Tax |
1,823 |
7,109 |
35 |
1,123 |
Less: Tax for earlier year(s) |
58 |
(189) |
(225) |
(199) |
Tax Expenses |
30,943 |
30,508 |
15,639 |
15,731 |
Profit after Taxation from Continuing Operations |
93,282 |
1,31,073 |
56,891 |
70682 |
Share of Profit from Associates and Joint Ventures (net of taxes) |
196 |
172 |
- |
- |
Profit for the Period Add/ Less: Other Comprehensive Income (OCI) |
93,478 |
1,31,245 |
56,891 |
70,682 |
Actuarial gain/ (loss) |
169 |
176 |
64 |
(27) |
Fair value gain/ (loss) of investment held through FVOCI |
(5,467) |
4,488 |
(3,976) |
2,324 |
Tax on OCI |
650 |
558 |
446 |
(259) |
Total Comprehensive Income Net profit attributable to: |
88,830 |
1,35,351 |
53,425 |
72,720 |
Owners of parent |
88,520 |
1,35,081 |
- |
- |
Non-controlling interests |
310 |
270 |
- |
- |
Add: Balance brought forward from previous year |
4,30,698 |
3,20,438 |
3,07,292 |
2,53,272 |
Profit available for appropriation Less: Appropriations |
93,169 |
1,30,974 |
56,891 |
70,682 |
Acturial gain/(losses) on post retirement benefit plan (net of taxes) |
125 |
131 |
48 |
(20) |
Transfer to Statutory Reserve |
(4,027) |
(2,729) |
- |
- |
Interim Dividend and Final Dividend |
(14,825) |
(8,674) |
(14,823) |
(7,365) |
Buyback Transaction cost |
(3,843) |
- |
(3,842) |
- |
ECL provision reserve |
- |
(28) |
- |
- |
Business combination cost |
(2,223) |
- |
(1,235) |
(7,032) |
Provision of Stamp Duty (Net of Tax impact) |
- |
(2,245) |
- |
(2,245) |
Transfer to Non-controlling interest |
(125) |
(7,171) |
- |
- |
Balance of Profit carried forward |
4,98,950 |
4,30,698 |
3,44,331 |
3,07,292 |
FINANCIAL PERFORMANCE Standalone
The standalone revenue in FY 2022-23 stood at ? 2,69,271 Lakhs vs ? 2,61,546 Lakhs in
FY 2021-22. Total expenses (before interest and depreciation) for the year stood at ?
1,70,002 Lakhs. People cost increased by 14% YoY to ? 61,095 Lakhs. Operating expenses
increased by 2% YoY to ? 77,886 Lakhs. The profit before depreciation, interest and
taxation (EBITDA) stood at ? 99,269 Lakhs. Reported net profit after tax for the year came
in at ? 56,891 Lakhs.
Consolidated
The consolidated revenue for the year was ? 4,19,712 Lakhs. The average daily traded
volumes (ADTO) for the equity markets during FY 2022-23 stood at ? 154 Lakh Crores, up
121% YoY from ? 70 Lakh Crores in FY 2021-22. The overall Cash market ADTO reported a
decline of 21% YoY at ? 57,564 Crores in FY 2022-23. Within derivatives, futures volume
decreased 4% YoY to ? 1.1 Lakh Crores while options rose 125% YoY to ? 152 Lakh Crores.
Amongst cash market participants, retail constitutes 47% of total cash volume, institution
25% and prop 28%. The proportion of DII in the cash market was 10%. In FY 2022-23, 2.5
Crores new demat accounts were added as against 3.5 Crores in FY 2021-22. The number of
demat accounts stood at 11.45 Crores in FY 2022-23, a growth of 28% YoY.
Key Highlights
- Capital market business (Broking + Investment Banking) income grew 11% YoY to ? 2,833
Crores.
- The Company had 35 Lakhs retail broking and distribution clients growing at a CAGR of
27% from FY 2017-18 to FY 2022-23. Client acquisition stood at 6.5 Lakhs during the year.
- Our financial product distribution AUM was ? 21,292 Crores as of March 2023, up 17%
YoY.
- Investment banking business successfully completed 4 marquee deals in FY 2022-23. The
team has a rich pipeline and continues to engage on a wide cross-section of mandated
transactions across capital markets and advisory.
- Asset management income stood at ? 555 Crores. Total assets under management across
mutual funds, PMS and AIF was ? 45,620 Crores, down 7% YoY. Within this, the mutual fund
AUM stood at to ? 29,560 Crores, while Alternates AUM (PMS and AIF) stood at ? 15,830
Crores.
- The private equity income grew by 36% YoY to ? 177 Crores. The income from wealth
management business stood at ? 223 Crores, up 14% YoY. The wealth management AUM for FY
2022-23 was at ? 52,000 Crores, up 51% YoY.
- Housing finance gross income stood at ? 532 Crores. HFC loan book grew by 10% YoY to
? 3,772 Crores as of March 2023. Disbursements stood at ? 1,007 Crores, up 57% YoY.
In our fund based businesses, our total investments including alternate investments
stood at ? 4,280 Crores with a since inception IRR of 16%.
Total expenses (before interest, depreciation and taxation) for the year was ? 2,30,066
Lakhs. Profit before depreciation, interest and taxation (EBITDA) stood at ? 1,89,646
Lakhs, a decrease of 11% from the previous year. Profit after tax for the year decreased
by 29% to ? 93,282 Lakhs.
The detailed results of operations of the Company are given in the Management
Discussion and Analysis Report forming part of the Annual Report.
FUTURE OUTLOOK
We have delivered sustainable performance in FY2023 despite of market headwinds. Our
strategy is to further diversify our business model towards more annuity sources of
earnings.
Our Asset Management business has seen improvement in performance which is expected to
culminate into better fund flows. Our Wealth Management business is on its way to achieve
scale as we continue to invest in Relationship Managers. Our Housing Finance business has
witnessed turnaround by improving disbursement and profitability parameters. Our brand is
now being recognized across each of our businesses. Each of our business segments offer
huge headroom for growth and we are well placed to benefit from this.
CONSOLIDATED FINANCIAL STATEMENTS
As per Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 ("Listing Regulations") and applicable provisions of the
Companies Act, 2013 ("the Act") read with the Rules made thereunder (as amended
from time to time), the Consolidated Financial Statements of the Company for the FY
2022-23 have been prepared in compliance with applicable Indian Accounting Standards and
on the basis of the Audited Financial Statements of the Company and its subsidiaries, as
approved by the respective Board of Directors ("Board").
The Consolidated Financial Statements together with the Auditors' Report is forming
part of the Annual Report.
ENVIRONMENT, SOCIAL AND GOVERNANCE INITIATIVES
Since your Company strongly believes in raising corporate transparency, strengthening
risk management, promoting stakeholder engagement, improving communications with
Stakeholders, your Company has undertaken various Environment, Social and Governance(ESG)
initiatives during FY 2022-23. The separate disclosure on ESG initiatives is forming part
of this Annual Report.
INFORMATION ON THE STATE OF AFFAIRS OF THE COMPANY
The information on the affairs of the Company has been given in Management Discussion
and Analysis Report forming part of the Annual Report.
MATERIAL CHANGES AND COMMITMENTS, AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments, affecting the financial position
of the Company, which have occurred between the end of the financial year to which these
financial statements relate and the date of this Report.
DIVIDEND
In terms of Regulation 43A of the Listing Regulations, the Board of the Company has
approved the Dividend Distribution Policy in line with the requirements of the Listing
Regulations and it is available on the website of the Company and can be accessed at https://www.motilaloswalgroup.com/Downloads/IR/206776066708.-Dividend-
Distribution-Policy.pdf.
During the year under review, the Board of the Company, based on the parameters laid
down in the Dividend Distribution Policy, at its meeting held on January 24, 2023 had
declared and paid an Interim Dividend of ? 7/- per Equity Share for the FY 2022-23, out of
the profits of the Company for the third quarter and nine months ended December 31,2022,
on 14,78,75,116 Equity Shares having face value of ? 1/- each, aggregating to ?
103,51,25,812/-.
Further, the Board at its Meeting held on April 27, 2023 have recommended a Final
Dividend of ? 3/- per Equity Share having face value of ? 1/- each for FY 2022-23, subject
to approval of the Members of the Company at the ensuing Annual General Meeting
("AGM").
The Final Dividend, if approved at the ensuing AGM, would be paid to those Members
whose name appear in the Register of Members/ Beneficial Holders as on July 04, 2023.
TRANSFER TO RESERVES
The Board of your Company decided not to transfer any amount to the General Reserve and
retain the entire amount of profit under Retained Earnings.
CREDIT RATING
During the year under review, the Credit Rating agencies have reaffirmed/ assigned the
below credit ratings:
Rating Agency |
Instrument Type |
Size of Issue (? Crore) |
Rating/Outlook |
Rating Action |
CRISIL Limited |
Commercial Papers |
1,750 |
CRISIL A1 + |
Reaffirmed |
Non-Convertible Debentures |
500 |
CRISIL AA Stable |
Assigned |
ICRA Limited |
Commercial Papers |
3,500 |
[ICRA]A1 + |
Assigned |
Long-term Principal Protected Market Linked Debentures |
100 |
PP-MLD[ICRA]AA (Stable) |
Reaffirmed |
Non-Convertible Debentures |
300 |
[ICRA]AA (Stable) |
Reaffirmed |
Bank Lines - Unallocated |
300 |
[ICRA]AA (Stable) |
Reaffirmed |
India Ratings & Research Private Limited |
Commercial Papers |
1,000 |
IND A1 + |
Assigned |
2,500 |
IND A1 + |
Affirmed |
Non-Convertible Debentures |
300 |
IND AA/Stable |
Affirmed |
Bank Lines - Unallocated |
300 |
IND AA/Stable |
Affirmed |
The above ratings indicate a very strong degree of safety regarding timely servicing of
financial obligations.
SHARE CAPITAL
During the year under review, the Company has allotted 3,38,752 Equity Shares having
face value of ? 1/- each to eligible employees upon exercise of the vested options granted
to the said employees under various Employee Stock Option Schemes of the Company and
bought-back 14,54,545 Equity Shares.
Consequently, the paid up Share Capital of the Company as at March 31, 2023 stood at ?
14,79,47,126/- comprising of 14,79,47,126 Equity Shares having face value of ? 1/- each.
The Authorised Share Capital of the Company as on March 31, 2023 is ? 1,74,00,00,000/-
divided into 1,12,00,00,000 Equity Shares of ? 1/- each aggregating to ? 1,12,00,00,000/-
and 62,00,000 Preference Shares of ? 100/- each aggregating to ? 62,00,00,000/- .
BUY-BACK OF EQUITY SHARES
The Board of Directors at its Meeting held on May 17, 2022 had approved the proposal of
Buy-back of fully paid up Equity Shares of face value of ? 1/- each not exceeding
14,54,545 equity shares (representing 0.98% of the total
paid-up Equity Share Capital of the Company as on March 31, 2022) at a price of ?
1,100/- per Equity Share paid in cash for an aggregate amount not exceeding ?
160,00,00,000/- excluding transaction cost, which represents 5.09% and 4.11% of the fully
paid-up Equity Share capital and free reserves as at March 31,2022, respectively, through
the "Tender Offer" route using mechanism for acquisition of shares through stock
exchange as prescribed under the SEBI (Buy-Back of Securities) Regulations, 2018, as
amended from time to time (the "Buy-back Regulations") and the Act read with the
Rules made thereunder. The tender period for the Buy-back was open from Friday, June 24,
2022 and closed on Thursday, July 07, 2022. Accordingly, the Company has bought back
14,54,545 Equity Shares on July 18, 2022 (i.e. settlement date) and the said shares have
been extinguished on July 22, 2022.
EMPLOYEE STOCK OPTION SCHEMES
The disclosures required to be made under the SEBI (Share Based Employee Benefits &
Sweat Equity) Regulations, 2021 ("ESOP Regulations") (as amended from time to
time), are available on the website of the Company at https://www.motilaloswalgroup.com/Downloads/IR/2012017271ESOP-Annexure-2022-23.pdf.
Further, the Company confirms that all the Employee Stock Option Schemes of the Company
are falling under direct route and not under Trust route and accordingly the provisions
related to Trust route as specified in the ESOP Regulations are not applicable to the
Company. Further, all the permanent employees (except the persons as mentioned in the ESOP
Regulations) of the Company and its subsidiary companies are entitled to participate in
the said Schemes of the Company. Further, the Company confirms that it has not granted
employee stock options equal to or exceeding one percent of the Issued Share Capital of
the Company at the time of grant of stock options to any employees of the Company/
Subsidiary Company. There has been no change in the ESOP Schemes during the year under
review.
The Secretarial Auditor of the Company, M/s. U. Hegde & Associates, has certified
that the Company's above-mentioned Schemes have been implemented in accordance with the
ESOP Regulations and the Resolutions passed by the Members of the Company for the
respective Schemes. The Certificate from the Secretarial Auditor, confirming compliance
with the aforesaid provisions would be presented to the Members at the ensuing AGM of the
Company. The Employee Stock Option Schemes are administered by the Nomination and
Remuneration Committee ("NRC") of the Board of the Company, in accordance with
the applicable provisions of the ESOP Regulations.
DEBENTURES
During the year under review, the Company has issued and allotted 284 Non-Convertible
Debentures ("NCDs") of ? 10 Lakhs each aggregating to ? 28.40 Crore, on private
placement basis. These NCDs are listed and traded on BSE Limited. Further, 3,622 NCDs of ?
10 Lakhs each aggregating to ? 362.2 Crore were redeemed during the year. Accordingly, 442
NCDs of ? 10 Lakhs each aggregating to ? 44.20 Crore are outstanding as on March 31, 2023.
The Company has been servicing payment of the interest on the due dates.
The details of the Debenture Trustee of the Company is as under:
Beacon Trusteeship Limited
4C & D, Siddhivinayak Chambers,
Gandhi Nagar, Opp. MIG Cricket Club,
Bandra (East), Mumbai 400 051,
Tel: +91 (0)22 2655 8759, +91 955 544 9955 Website: www.beacontrustee.co.in
DEPOSITS
During the year under review, the Company has not accepted or renewed any amount
falling within the purview of provisions of Section 73 of the Act read with the Companies
(Acceptance of Deposits) Rules, 2014.
ANNUAL RETURN
Pursuant to the provisions of Section 134(3) and Section 92(3) of the Act read with
Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the Annual Return
of the Company in prescribed Form MGT-7 for the financial year ended March 31, 2023 is
uploaded on the website of the Company at https://www.motilaloswalgroup.com/Downloads/IR/691471774Form
MGT 7 AGM Website Upload.pdf
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the year under review, as stipulated
under Regulation 34 of the Listing Regulations is presented in a separate section forming
part of the Annual Report.
SUBSIDIARY COMPANIES
The Company along with its subsidiaries, offers a diversified range of financial
products and services such as institutional equities, asset management business, housing
finance, private equity, private wealth management, investment banking, loan against
securities and investment activities.
As on March 31,2023, the Company had 18 subsidiaries (including step down
subsidiaries). There are no associate companies or joint venture within the meaning of
Section 2(6) of the Act as on March 31,2023.
Further, pursuant to the provisions of Section 136(1) of the Act, the Financial
Statements for the period ended March 31, 2023 of each subsidiary of the Company is made
available on the website of the Company at www.motilaloswalgroup.com.
Material Subsidiaries
As required under Regulation 16(1)(c) and 46 of the Listing Regulations, the Board has
approved the Policy on Determination of Material Subsidiaries ("Policy"). The
said Policy is available on the website of the Company and can be accessed at https://www.motilaloswalgroup.com/Downloads/IR/212618793Policy-on-Determination-of-Material-
Subsidiaries.pdf. Accordingly, Motilal Oswal Home Finance Limited ("MOHFL'),
Motilal Oswal Asset Management Company Limited ("MOAMC") and Motilal Oswal
Finvest Limited ("MOFL') are material subsidiaries of the Company.
Investment in Subsidiaries
During the year under review, the Company has acquired entire Share Capital i.e. 50,000
Equity Shares having face value of ? 10/- each of MO Alternative IFSC Private Limited
("MO Alternative"). Accordingly, MO Alternative has become the Wholly-owned
Subsidiary of the Company.
During the year under review, the Company has also set up a Representative Office in
Dubai, United Arab Emirates. Performance and Financial Position of Subsidiaries
As required under Rule 5 and Rule 8(1) of the Companies (Accounts) Rules, 2014, a
report on the highlights of performance of subsidiaries and their contribution to the
overall performance of the Company has been appended as "Annexure 1" to
this Report.
Pursuant to the provisions of Section 129(3) of the Act, a statement containing salient
features of the Financial Statements of subsidiaries in Form AOC-1 is annexed to the
Consolidated Financial Statements forming part of the Annual Report. Your Company will
also e-mail the copy of separate Audited Financial Statements in respect of each of the
Subsidiary Company upon request by any Member of the Company interested in obtaining the
same.
In accordance with the provisions of Section 136 of the Act, the separate Audited
Financial Statements in respect of each of the Subsidiary Company is also made available
on the website of your Company at www.motilaloswalgroup.com. These documents will
be available for inspection in electronic mode. Members can inspect the same up to the
date of AGM, by sending an e-mail to the Company at shareholders@motilaloswal.com.
The Company monitors performance of its subsidiary companies, inter alia, by the
following means:
Financial Statements, in particular investments made by the Subsidiary
Companies, are reviewed quarterly by the Company's Audit Committee.
Minutes of Board Meetings of the Subsidiary Companies are placed before the
Company's Board quarterly.
A statement containing all significant transactions and arrangements entered
into by the Subsidiary Companies is placed before the Company's Board.
Presentations are made to the Company's Board on business performance of major
subsidiaries of the Company by the Senior Management.
BOARD, COMMITTEES OF THE BOARD & KEY MANAGERIAL PERSONNEL Composition of Board
The composition of the Board of the Company is in accordance with the provisions of
Section 149 of the Act and Regulation 17 of the Listing Regulations, with an optimum
combination of Executive, Non-Executive and Independent Directors.
The Board of the Company has 10 (Ten) Directors comprising of 1 (One) Non-Executive
Chairman, 1 (One) Managing Director & Chief Executive Officer, 2 (Two) Whole-time
Directors, 1 (One) Non-Executive Director and 5 (Five) Independent Directors. The complete
list of Directors of the Company has been provided in the Report on Corporate Governance
forming part of the Annual Report.
The Directors on the Board of the Company are persons with proven competency,
integrity, experience, leadership qualities, financial and strategic insight. They have a
strong commitment to the Company and devote sufficient time to the Meetings.
During the year under review, there was no change in the composition of the Board of
the Company.
Director(s) liable to retire by rotation
In accordance with Section 152 of the Act and the Articles of Association of the
Company, Mr. Motilal Oswal and Mr. Rajat Rajgarhia will retire by rotation at the ensuing
AGM and being eligible, have offered themselves for re-appointment. Based on the
recommendation of the NRC, the Board recommends their re-appointment(s) for the approval
of the Members of the Company. The brief profile of Mr. Motilal Oswal and Mr. Rajat
Rajgarhia are included in the Notice of the AGM of the Company.
Re-appointment of Directors
The Board, based on the performance evaluation and on recommendation of the NRC, has
considered below re-appointments at its Meeting held on April 27, 2023 subject to approval
of the Members of the Company and on terms and conditions including remuneration as
mentioned in the Notice of the ensuing AGM.
Sr. No. |
Name of the Director |
DIN |
Designation |
Term |
Effective from |
1. |
Mr. Ajay Menon |
00024589 |
Whole-time Director |
5 years |
August 21,2023 |
2. |
Mr. Chitradurga Narasimha Murthy (Mr. C. N. Murthy) |
00057222 |
Independent Director |
3 years |
July 01, 2023 |
3. |
Mr. Pankaj Bhansali |
03154793 |
Independent Director |
5 years |
July 01, 2023 |
4. |
Mrs. Divya Sameer Momaya |
00365757 |
Independent Director |
5 years |
July 01, 2023 |
5. |
Mr. Chandrashekhar Karnik |
00003874 |
Independent Director |
3 years |
September 16, 2023 |
6. |
Mrs. Swanubhuti Jain |
09006117 |
Independent Director |
5 years |
December 24, 2023 |
The Resolutions seeking approval of Members for the re-appointment of all the Directors
are detailed in the Notice of the ensuing AGM along with their brief profile.
Meetings of the Board
During the year under review, the Board met 5 (five) times to discuss and approve
various matters including financials, buy-back and other businesses. For further details,
please refer to the Report on Corporate Governance forming part of the Annual Report. The
maximum interval between any two meetings did not exceed 120 (One Hundred and Twenty)
days, as prescribed in the Act and the Listing Regulations.
Committees of the Board
The Board has set up various Committees in compliance with the requirements of the
business & relevant provisions of applicable laws and layered down well documented
terms of references of all the Committees. Details with respect to the Composition, terms
of reference and number of meetings held, etc. are included in the Report on Corporate
Governance forming part of the Annual Report.
During the year under review, all the recommendations/submissions made by the Audit
Committee and other Committees of the Board were accepted by the Board.
Separate Meeting of Independent Directors
As stipulated in the Code of Conduct for Independent Directors under the Act and the
Listing Regulations, a separate Meeting of the Independent Directors of the Company was
held on April 28, 2022 to review the performance of Non-Independent Directors (including
the Chairman) and the Board as a whole. The Independent Directors also assessed the
quality, quantity and timeliness of flow of information between the Company Management and
the Board, which is necessary to effectively and reasonably perform and discharge their
duties.
Declaration by Independent Directors
All the Independent Directors of your Company have submitted their declaration of
independence, as required, pursuant to the provisions of Section 149(7) of the Act and
Regulation 25(8) of the Listing Regulations, stating that they meet the criteria of
independence, as provided in Section 149(6) of the Act and Regulation 16(1)(b) of the
Listing Regulations and are not disqualified from continuing as Independent Directors of
your Company. Further, veracity of the above declarations has been assessed by the Board,
in accordance with Regulation 25(9) of the Listing Regulations.
The Board is of the opinion that the Independent Directors of the Company hold highest
standards of integrity and possess requisite qualifications, expertise & experience
(including the proficiency) and competency in the business & industry knowledge,
financial expertise, digital & information technology, corporate governance, legal and
compliance,
marketing & sales, risk management, leadership & human resource development and
general management as required to fulfill their duties as Independent Directors.
Further, in terms of Section 150 of the Act read with Rule 6 of the Companies
(Appointment and Qualification of Directors) Rules, 2014, all the Independent Directors
have confirmed that they have registered themselves with databank maintained by the Indian
Institute of Corporate Affairs ("MCA"). These declarations/ confirmations have
been placed before the Board. The Independent Directors are also required to undertake
online proficiency selfassessment test conducted by the IICA within a period of 2 (Two)
years from the date of inclusion of their names in the data bank, unless they meet the
criteria specified for exemption. Accordingly, Mr. Pankaj Bhansali, Mrs. Divya Momaya and
Mrs. Swanubhuti Jain have passed online proficiency self-assessment test conducted by the
IICA while Mr. C. N. Murthy and Mr. Chandrashekhar Karnik are exempt to pass the online
proficiency self-assessment test pursuant to the first proviso of Rule 6(4) of the
Companies (Appointment and Qualification of Directors) Rules, 2014.
Key Managerial Personnel
As at March 31, 2023, the Company has the following Key Managerial Personnel:
1) Mr. Motilal Oswal - Managing Director & Chief Executive Officer
2) Mr. Ajay Menon - Whole-time Director
3) Mr. Rajat Rajgarhia - Whole-time Director
4) Mr. Shalibhadra Shah - Chief Financial Officer
5) Mr. Kailash Purohit - Company Secretary & Compliance Officer
FAMILIARIZATION PROGRAMMES
In terms of the provisions of Regulation 25 of the Listing Regulations, the Company has
framed a policy on 'Familiarisation Programme for Independent Directors'. Accordingly,
upon appointment of an Independent Director, the appointee is given a formal Letter of
Appointment, which inter alia, explains the role, function, duties and
responsibilities expected as a Director of the Company.
Further, the Independent Directors are familiarised with the Company, their roles,
responsibilities in the Company, nature of industry in which the Company operates,
business model of the Company, various businesses in the group etc. The Directors are also
explained in detail the compliance required from them under the Act and the Listing
Regulations. Further, on an ongoing basis as a part of Agenda of the Board/ Committee
Meetings, presentations are regularly made to the Independent Directors on various matters
inter-alia covering the business strategies, management structure, management
development, quarterly and annual results, budgets, review of Internal Audit, risk
management framework, operations of subsidiaries and associates.
The Policy on familiarisation programme for Independent Directors along with the
details of the Familiarization Programmes are available on the website of the Company and
can be accessed at https://www.motilaloswalgroup.com/Downloads/IR/453138119Familiarization-Programmes-for-Independent-Director
2023.pdf.
COMPANY'S POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION
Section 178 of the Act and Regulation 19 read with Part D of Schedule II of the Listing
Regulations requires the NRC to formulate a Policy relating to the remuneration for the
Directors, Key Managerial Personnel ("KMP"), Senior Management and other
employees of the Company and recommend the same for approval of the Board.
The Company, based on the recommendation of the NRC, has framed a Nomination and
Remuneration Policy relating to appointment of Directors, payment of managerial
remuneration, Directors qualifications, positive attributes,
independence of Directors and other related matters as provided under Section 178 of
the Act and Regulation 19 read with Part D of Schedule II of the Listing Regulations.
Accordingly, in compliance to the aforesaid provisions, the Nomination and Remuneration
Policy of the Company is available on the website of the Company and can be accessed at: https://www.motilaloswalgroup.com/Downloads/IR/101791301707.-MOFSL-Nomination-and-Remuneration-Policy.pdf
The salient features of the Policy are given below:
Appointment criteria and qualifications:
1. The NRC shall identify and ascertain the integrity, qualification, expertise and
experience of the person for appointment as Director, KMP or Senior Management and
recommend to the Board his/ her appointment.
2. A person should possess adequate qualification, expertise and experience for the
position he/ she is considered for appointment. The NRC has discretion to decide whether
qualification, expertise and experience possessed by a person are sufficient/ satisfactory
for the concerned position.
3. The Company shall not appoint or continue the employment of any person as Managing
Director/ Whole-time Director/ Manager who has attained the age of seventy years.
Provided that the term of the person holding this position may be extended beyond the
age of seventy years with the approval of the Shareholders by passing a Special Resolution
based on the explanatory statement annexed to the notice for such motion indicating the
justification for extension of appointment beyond seventy years.
4. The Company shall not appoint a person or continue the directorship of any person as
a Non-Executive Director who has attained the age of seventy-five years unless a Special
Resolution is passed to that effect, in which case the explanatory statement annexed to
the notice for such motion shall indicate the justification for appointing such a person.
> Evaluation:
The performance evaluation shall be carried out as given below:-
Performance Evaluation by |
Of Whom |
Nomination and Remuneration Committee |
- Every Director's performance |
Board of Directors |
- All Directors excluding the Director being evaluated |
- Board and Committees as a whole |
Independent Directors |
- Review the performance of Non-independent Directors and Chairperson of the Company |
The NRC shall carry out evaluation of performance of every Director at regular interval
(yearly).
> Removal:
Due to reasons for any disqualification mentioned in the Act, the Rules made thereunder
or under any other applicable provisions of the Act, Rules and Regulations, the NRC may
recommend, to the Board with reasons recorded in writing, removal of a Director, KMP or
Senior Management subject to the provisions and compliance of the said Act, Rules and
Regulations.
> Retirement:
The Director, KMP and Senior Management shall retire as per the applicable provisions
of the Act and the
prevailing internal policy of the Company. The Board will have the discretion to retain
the Director, KMP, Senior
Management in the same position/ remuneration or otherwise even after attaining the
retirement age, for the
benefit of the Company.
Provisions relating to remuneration of Managerial Person, KMP and Senior Management
> General:
1. The remuneration/ compensation/ commission etc. to Managerial Person, KMP and Senior
Management will be determined by the NRC and recommended to the Board for approval. The
remuneration/ compensation/ commission etc. shall be subject to the prior/ post approval
of the Shareholders of the Company and such other approval, wherever required.
2. The remuneration and commission to be paid to Managerial Person shall be as per the
statutory provisions of the Act and the Rules made thereunder and Listing Regulations, for
the time being in force.
3. Increments to the existing remuneration/ compensation structure may be recommended
by the NRC to the Board which should be within the slabs approved by the Shareholders in
the case of Managerial Person.
4. The remuneration structure will have a right mix of guaranteed (fixed) pay,
performance pay and long term variable pay based on business growth and other factors such
as growth in Shareholder's value to ensure that it is competitive and reasonable.
5. Where any insurance is taken by the Company on behalf of its Managerial Person, KMP
and Senior Management for indemnifying them against any liability, the premium paid on
such insurance shall not be treated as part of the remuneration payable to any such
personnel.
> Remuneration to Managerial Person, KMP and Senior Management:
1. Fixed pay:
Managerial Person, KMP and Senior Management shall be eligible for a monthly
remuneration as may be approved by the Board on the recommendation of the NRC in
accordance with the statutory provisions of the Act and the rules made there under for the
time being in force. The break-up of the pay scale and quantum of perquisites including
employer's contribution to Provident Fund(s), pension scheme(s), medical expenses, club
fees etc. shall be decided and approved by the Board on the recommendation of the NRC and
approved by the shareholders and such other approval, wherever required.
2. Variable Pay:
The Company may in its discretion structure any portion of remuneration to link rewards
to corporate and individual performance, fulfilment of specified improvement targets or
the attainment of certain financial or other objectives set by the Board. The amount
payable shall be based on performance against pre-determined financial and non-financial
metrics.
3. Provision for excess remuneration:
If, in any financial year, the Company has no profits or its profits are inadequate,
the Company shall pay remuneration to its Managerial Person in accordance with the
provisions of Schedule V of the Act. If any Managerial Person draws or receives, directly
or indirectly by way of remuneration any such sums in excess of the limits prescribed
under the Act or without such approval, wherever required, he/ she shall refund such sums
to the Company and until such sum is refunded, hold it in trust for the Company.
Provided that the Company may waive the recovery of any sum refundable to it after
passing of the Special Resolution within two years from the date the sum becomes
refundable.
> Remuneration to Non-Executive/ Independent Director:
1. Remuneration/ Commission:
The remuneration/ commission, if any, shall be in accordance with the statutory
provisions of the Act and the Rules made thereunder for the time being in force.
2. Sitting Fees:
The Non-Executive/ Independent Director may receive remuneration by way of fees for
attending meetings of the Board or Committee thereof.
Provided that the amount of such fees shall not exceed the maximum amount as provided
in the Act, per meeting of the Board or Committee or such amount as may be prescribed from
time to time.
3. Limit of Remuneration/ Commission:
Remuneration/ Commission may be paid to Non-Executive/ Independent Directors within the
monetary limit approved by the Shareholders, subject to the limit not exceeding 1% of the
net profits of the Company computed as per the applicable provisions of the Act. If, in
any financial year, the Company has no profits or its profits are inadequate, the Company
shall pay remuneration to its Non-Executive/Independent Directors in accordance with the
provisions of Schedule V of the Act. If any Non-Executive/ Independent Directors draws or
receives, directly or indirectly by way of remuneration any such sums in excess of the
limits prescribed under the Act or without such approval, wherever required, he/ she shall
refund such sums to the Company, within two years or such lesser period as may be allowed
by the Company, and until such sum is refunded, hold it in trust for the Company.
Provided that the Company may waive the recovery of any sum refundable to it after
passing of the Special Resolution within two years from the date the sum becomes
refundable.
PERFORMANCE EVALUATION
Pursuant to the provisions of Section 134(3)(p) and Schedule IV of the Act and in
accordance to Regulation 17(10) and 25(4) of the Listing Regulations, the Board has
carried out the annual performance evaluation of the Board as a whole, various Committees
of the Board and of the Individual Directors. The performance evaluation of the
Independent Directors was carried out by the entire Board.
The Board and the NRC reviewed the performance of the Individual Directors based on
various aspects which, inter alia, included transparency, performance, the level of
participation in the Board Meetings, inputs provided to executive management on matters of
strategic importance, familiarization with the business of the Company and its
subsidiaries, etc.
In a separate meeting of Independent Directors, performance of Non-Independent
Directors and the Chairman of the Company was evaluated, taking into account the views of
the Executive Directors and Non-Executive Directors. The same was discussed in the Board
meeting that followed the meeting of Independent Directors, at which the performance of
the Board, its committee and Individual Directors was also discussed.
The outcome of the performance evaluation of the Board for the year under review was
discussed by the NRC and the Board at their respective meetings. All the Directors
expressed satisfaction with the evaluation process.
SUCCESSION PLAN
The Board of Directors has satisfied itself that plans are in place for ensuring
orderly succession for appointments to the Board and to Senior Management.
PARTICULARS OF EMPLOYEES
Disclosure with respect to the percentage increase in remuneration, ratio of the
remuneration of each Director and Key Managerial Person to the median employee's
remuneration and other details in terms of sub-section 12 of Section 197 of the Act read
with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, has been appended as "Annexure 2" to the this Report.
In terms of first proviso to Section 136 of the Act, the Report and Financial
Statements are being sent to the Members and others entitled thereto, excluding the
information on employees' particulars as required pursuant to the provisions of Rule 5(2)
and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014. The said information pertaining to the names and other particulars of employees will
be available for inspection by Members in electronic mode. Members can inspect the same up
to the date of AGM, by sending an e-mail to the Company at shareholders@motilaloswal.com.
Any Member interested in obtaining a copy of the said Annexure may write to the Company
Secretary & Compliance Officer in this regard.
The Board of Directors affirms that the remuneration paid to Senior Management of the
Company is as per the Nomination and Remuneration Policy of the Company.
GOVERNANCE
Report on Corporate Governance
A detailed Report on Corporate Governance in terms of Schedule V of the Listing
Regulations for FY 2022-23, is forming part of the Annual Report.
Further, a Certificate from M/s. Singhi & Co., the Statutory Auditors of the
Company confirming compliance with conditions of Corporate Governance as stipulated in
Regulation 34 read with Schedule V to the Listing Regulations is annexed to the Report on
Corporate Governance.
Code of Conduct
Pursuant to Regulation 26(3) of the Listing Regulations, all the Directors & Senior
Management of the Company have affirmed compliance with the Code of Conduct of the
Company.
Vigil Mechanism/ Whistle Blower Policy
Pursuant to the provisions of Section 177(9) of the Act read with Rule 7 of the
Companies (Meetings of Board and its Powers) Rules 2014 and Regulation 22 of the Listing
Regulations, the Company has framed Vigil Mechanism/ Whistle
Blower Policy ("Policy") to enable directors and employees to report genuine
concerns or grievances, significant deviations from key management policies and report any
non-compliance and wrong practices, e.g., unethical behavior, fraud, violation of law,
inappropriate behavior/ conduct etc.
The functioning of the Vigil Mechanism is reviewed by the Audit Committee from time to
time. None of the Directors or employees have been denied access to the Audit Committee of
the Board.
The objective of this mechanism is to maintain a redressal system which can process all
complaints concerning questionable accounting practices, internal controls, or fraudulent
reporting of financial information.
The Policy framed by the Company is in compliance with the requirements of the Act
& Listing Regulations and is available on the website of the Company and can be
accessed at https://www.motilaloswalgroup.com/Downloads/IR/785307607MOFSL
Vigil-MechanismWhistle-Blower-Policy.pdf.
Prevention of Sexual Harassment of Women at Workplace
The Company has zero tolerance on sexual harassment at workplace. The Company has
formulated a Policy on Prevention of Sexual Harassment at Workplace and has also
constituted an Internal Complaints Committee ("ICC") as stipulated by the Sexual
Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the
Rules made thereunder. Appropriate reporting mechanisms are in place for ensuring
protection against Sexual Harassment and the right to work with dignity.
During the year under review, ICC had received one complaint relating to sexual
harassment, which has been investigated and closed.
RISK MANAGEMENT
Risk is an integral and unavoidable component of business. Though risks cannot be
eliminated, an effective risk management program ensures that risks are reduced, avoided,
mitigated or shared.
The Company realizes the importance of Enterprise Risk Management ("ERM")
framework and had taken early initiatives towards its implementation. The Company has also
formulated group Risk Management Policy.
A systematic approach has been adopted that originates with the identification of risk,
categorization and assessment of identified risk, evaluating effectiveness of existing
controls and building additional controls to mitigate risk and monitoring the residual
risk through effective Key Risk Indicators ("KRI"). The implementation is being
carried out in phased manner with the objective to encompass the entire line of
businesses.
Effective ERM involves a robust implementation of three lines of defense - first line
of defense is the front-line employees, the second line of defense is the risk and
compliance function and the third line of defense is external and internal auditors. To
build an effective risk culture significant effort has been made towards robustness of
these lines of defense.
Further, pursuant to Regulation 21 of the Listing Regulations, the Board of Directors
have also constituted the Risk Management Committee of the Board, details of which are
mentioned in the Report on Corporate Governance. The composition of the Committee is in
conformity with the Listing Regulations, with majority of members being Directors of the
Company. The Risk Management Committee is, inter alia, authorized to monitor and
review the risk assessment, mitigation and risk management plans for the Company from time
to time and report the existence, adequacy and effectiveness of the above process to the
Audit Committee/ Board on a periodic basis.
Further, in terms of SEBI Circular SEBI/HO/MIRSD/MIRSD-PoD-1/P/CIR/2023/24 dated
February 06, 2023 the Company is identified as Qualified Stock Broker and accordingly, the
Board at its Meeting held on April 27, 2023 has taken necessary steps to ensure compliance
with respect to enhanced obligations and responsibilities provided in aforesaid Circular.
In the opinion of the Board, there are no material elements of risks threatening the
existence of the Company.
The details of composition of the Risk Management Committee and its terms of reference,
is provided in the Report on Corporate Governance which forms part of this Annual Report.
BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT
In terms of Regulation 34(2)(f) of the Listing Regulations, the initiatives taken by
the Company from an Environmental, Social, Governance & Sustainability perspective are
provided in the Business Responsibility & Sustainability Report ("BRSR")
which is presented in a separate section and forms part of the Annual Report and is also
uploaded on the website of the Company at www.motilaloswalgroup.com. BRSR includes
details on performance against the nine principles of the National Guidelines on
Responsible Business Conduct and a report under each principle, which is divided into
essential and leadership indicators is also part of it.
The Business Responsibility & Sustainability Committee overviews the BRSR and
policies as may be required from time to time.
STATUTORY AUDITORS
Pursuant to the provisions of Section 139 of the Act read with the Companies (Audit and
Auditors) Rules, 2014, M/s. Singhi & Co., Chartered Accountants were appointed as the
Statutory Auditors of the Company by the Members at the 17th AGM of the Company
held on July 11,2022 for a term of 5 (five) years commencing from 17th AGM till
the conclusion of 22nd AGM of the Company.
The Auditors have confirmed that they are not disqualified to continue as Auditors and
are eligible to hold office as Auditors of the Company.
The Audit Committee reviews the independence and objectivity of the Auditors and the
effectiveness of the Audit process.
Mr. Nikhil Singhi, Partner, M/s. Singhi & Co., Chartered Accountants, Statutory
Auditors of the Company, has signed the Audited Financial Statements of the Company.
Statutory Auditors' Report
The Statutory Auditors' Report issued by M/s. Singhi & Co., Chartered Accountants
for the year under review does not contain any qualification, reservations, adverse
remarks or disclaimer. The Notes to the Accounts referred to in the Auditors' Report are
self-explanatory and therefore do not call for any further clarifications under Section
134(3)(f) of the Act. Further, pursuant to Section 143(12) of the Act, the Statutory
Auditors of the Company have not reported any instances of frauds committed in the Company
by its officers or employees.
SECRETARIAL AUDITOR
In terms of the provisions of Section 204 of the Act read with the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board had
appointed M/s. U. Hegde & Associates, Practicing Company Secretaries, as Secretarial
Auditor to undertake the Secretarial Audit of the Company for the FY 2022-23.
Secretarial Audit and Annual Secretarial Compliance Report
The Secretarial Audit Report issued by the Secretarial Auditor has been appended as
"Annexure 3" to this Report.
Pursuant to the provisions of Regulation 24A of the Listing Regulations, Annual
Secretarial Compliance Report for the financial year ended March 31,2023 was obtained from
M/s. U. Hegde & Associates, Practicing Company Secretaries.
There is no adverse remark, qualifications or reservation in the Secretarial Audit
Report and Annual Secretarial Compliance Report.
Secretarial Audit of Material Subsidiaries
In terms of Regulation 24A of the Listing Regulations, the Secretarial Audit Report of
material subsidiaries i.e. MOHFL, MOAMC & MOFL received from their respective
Secretarial Auditors for the FY 2022-23 are available at website of the Company at www.motilaloswalgroup.com.
MAINTENANCE OF COST RECORDS & COST AUDIT
The Company is engaged in carrying Stock Broking & related activities and hence
provisions related to maintenance of cost records and requirement of cost audit as
prescribed under the provisions of Section 148(1) of the Act are not applicable.
INTERNAL AUDITORS
The Board at its Meeting held on April 28, 2022 had appointed M/s. Aneja Associates,
Chartered Accountants, as Internal Auditors for the FY 2022-23 to conduct the internal
audit of the various areas of operations and records of the Company. Further, the Board at
its Meeting held on April 27, 2023 has appointed M/s. BDO India LLP and M/s. M S K C &
Associates, Chartered Accountants as the Internal Auditors for a term of 5 (five) years
commencing from FY 2023-24 to FY 2027-28.
The periodic reports of the said internal auditors are regularly placed before the
Audit Committee along with the comments of the management on the action taken to correct
any observed deficiencies on the working of the various departments.
INTERNAL FINANCIAL CONTROLS
The Internal Financial Controls with reference to the Financial Statements as designed
and implemented by the Company are adequate. The Internal Financial Control procedure
adopted by the Company are adequate for safeguarding its assets, the prevention and
detection of frauds and errors, the accuracy and completeness of the accounting records
and the timely preparation of reliable financial information. During the year under
review, the Internal Financial Controls were operating effectively and no material or
serious observations were received from the Auditors of the Company for inefficiency or
inadequacy of such controls.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
A) Conservation of energy: Information on Conservation of energy as required under
Section 134(3)(m) of the Act read with the Rules made thereunder is not applicable to the
Company and hence, no annexure forms part of this report.
B) Technology Absorption: The Management keeps itself abreast of the technological
advancements in the industry and has adopted the best in class technology across business,
operations and functions.
The Company is accelerating the technology and digital transformation on continuous
basis. It stays invested in creating a seamless digital and customer experience across
digital touchpoints. Your Company's focused approach is to keep on enhancing its in-house
tech capabilities.
For detailed information on initiatives taken by the Company for technology absorption,
please refer Business Responsibility & Sustainability Report forming part of the
Annual Report.
C) Foreign Exchange Earnings and Outgo: Please refer Note No. 47 to the Standalone
Financial Statements, forming part of the Annual Report.
DISCLOSURE OF DETAILS OF UNCLAIMED EQUITY SHARES IN THE SUSPENSE ACCOUNT:
Pursuant to Regulation 34 and Schedule V of the Listing Regulations, the Company
reports the following details in respect of unclaimed equity shares that are kept in
Specific Demat Accounts of Motilal Oswal Financial Services Limited:
Particulars |
Number of Shareholders |
Number of Equity Shares |
Aggregate Number of Shareholders and the outstanding shares in the suspense account
lying as on April 1, 2022 |
5 |
575 |
Number of Shareholders who approached the Company for transfer of shares from suspense
account during the year |
- |
- |
Number of Shareholders to whom shares were transferred from the suspense account
during the year |
- |
- |
Aggregate Number of Shareholders and the outstanding shares in the suspense account
lying as on March 31, 2023 |
5 |
575 |
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
Pursuant to the provisions of the Investor Education and Protection Fund Authority
(Accounting, Audit, Transfer and Refund) Rules, 2016, the shares in respect of which the
dividend is unpaid/ unclaimed for seven consecutive years are required to be transferred
to Investor Education and Protection Fund ("IEPF") after giving an opportunity
to the Shareholders to claim the said unpaid/ unclaimed dividend.
Accordingly, the Company issued the reminder letters to such Shareholders to claim the
dividend and also published the notice to such effect in the leading newspapers in English
and Regional Language having wide circulation and accordingly informed them that in the
event of failure to claim said divided, the unpaid/ unclaimed dividend along with shares
pertaining to unpaid/ unclaimed dividend would be transferred to IEPF.
Subsequently, the Company has transferred unpaid/ unclaimed dividend, amounting to ?
2,44,174/- on June 24, 2022, ? 1,09,144/- on August 25, 2022, ? 2,72,370/- on March 29,
2023 and 1,381 Equity Shares to IEPF on December 07, 2022 and 204 Equity Shares on April
20, 2023. The details of such shares are available on the website of the Company at https://www.motilaloswalgroup.com/Investor-Relations/Disclosures/IEPF.
The concerned Shareholders are requested to claim the said shares by directly approaching
IEPF Authority.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(5) of the Act, the Board of the Company, to
the best of their knowledge, belief, ability and explanations obtained by them, confirm
that:
1) in the preparation of the Annual Financial Statements for the financial year ended
March 31,2023, the applicable Accounting Standards have been followed along with proper
explanation relating to material departures, if any;
2) the Directors have selected such accounting policies and applied them consistently
and made judgments and estimates that are reasonable and prudent so as to give a true and
fair view of the state of affairs of the Company as at March 31,2023 and of the profit of
the Company for that period;
3) the Directors have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities;
4) the Directors have prepared the annual accounts on a going concern basis;
5) the Directors have laid down internal financial controls to be followed by the
Company and that such internal financial controls are adequate and operating effectively;
6) the Directors have devised proper systems to ensure compliance with the provisions
of all applicable laws and that such systems were adequate and operating effectively.
CORPORATE SOCIAL RESPONSIBILITY
The Company recognizes its responsibility towards society and strongly intends to
contribute towards development of knowledge based economy.
In terms of the provisions of Section 135 of the Act read with the Companies (Corporate
Social Responsibility Policy) Rules, 2014, the Company has constituted a Corporate Social
Responsibility ("CSR") Committee. The composition and terms of reference of the
CSR Committee is provided in the Report on Corporate Governance forming part of the Annual
Report.
The Company has also formulated a CSR Policy which is available on the website of the
Company at https://www.motilaloswalgroup.com/Downloads/IR/187119518002.-CSR-Policy
April-27.-2023.pdf
Further, the detailed CSR initiatives undertaken by the Company are available on the
website of the Company at https://www.motilaloswal.com/foundation/.
The Company's CSR activities are mainly focused on Education. The social contribution
made by the Company is covered in ESG section forming part of this Annual Report. We
assure you that your Company will continue to work towards its social commitment and
contribute in nation building with the same zeal.
The Company has made contribution through Motilal Oswal Foundation, a not-for-profit
charitable company incorporated under Section 25 of the Companies Act, 1956 to various
other not-for-profit organisations.
An Annual Report on CSR activities as required under the Companies (Corporate Social
Responsibility Policy) Rules, 2014 has been appended as "Annexure 4" to
this Report. Further, the Annual
Action Plan on CSR activities for FY 2023-24 is also uploaded on the website of the
Company at https://www.motilaloswalgroup.com/Downloads/IR/257509837MOFSL-CSR-Annual-Action-Plan-2023-24.pdf.
PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS AND SECURITIES
Particulars of loans given, investments made or guarantees or securities provided and
the purpose for which the loan or guarantee or security is proposed to be utilised by the
recipient of loan or guarantee or security pursuant to Section 186 of the Act are given
under Notes to Accounts annexed to Standalone Financial Statements for the year ended
March 31, 2023 and the same forms part of this Annual Report.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
In line with the requirements of the Act and Listing Regulations and pursuant to the
recommendation of the Audit Committee, the Company has formulated the policy on
Materiality and dealing with Related Party Transactions ("RPT Policy") which is
available on the Company's website and can be accessed at https://www.motilaloswalgroup.com/Downloads/IR/235673531Policy-on-Materiality-and-Dealing-with-Related-
Party-Transactions.pdf.
All related party transactions entered into during the FY 2022-23 were on an arm's
length basis and in the ordinary course of business.
All related party transactions were placed before the Audit Committee for prior
approval. Prior omnibus approval of the Audit Committee is obtained for the transactions
which are of unforeseen or repetitive in nature. The details of all such related party
transactions entered into pursuant to the omnibus approval of the Committee, were placed
before the Audit Committee on a quarterly basis for its review.
Further, the Company has also obtained approval of the Members of the Company for
entering into material related party transaction with MOHFL.
Pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies
(Accounts) Rules, 2014, there are no transactions to be reported under Section 188(1) of
the Act. Accordingly, the disclosure of Related Party Transactions, as required in Form
AOC-2 is not applicable to the Company.
Details of transactions, contracts and arrangements entered into with related parties
by the Company, during FY 2022-23, is given under Note no. 51 to the Standalone Financial
Statements, which forms part of the Annual Report.
The particulars of loans/ advances, etc., required to be disclosed in the Annual
Accounts of the Company pursuant to Para A of Schedule V of the Listing Regulations are
furnished in the Notes to Accounts annexed to Standalone Financial Statements, which forms
part of the Annual Report.
COMPLIANCE WITH SECRETARIAL STANDARD
The Company has followed the applicable Secretarial Standards, i.e. SS-1 and SS-2,
issued by the Institute of Company Secretaries of India, relating to 'Meetings of the
Board of Directors' and 'General Meetings' respectively.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
During the year under review, there were no significant and material orders passed by
the regulators or courts or tribunals that would impact the going concern status of the
Company and its future operations.
OTHER DISCLOSURES
Your Directors state that no disclosure or reporting is required in respect of the
following matters as there were no transactions on these matters during the year under
review:
> Issue of equity shares with differential rights as to dividend, voting or
otherwise.
> There has been no change in the nature of business of the Company.
> Mr. Motilal Oswal, Managing Director and Chief Executive Officer of the Company
draws remuneration from MOHFL, Subsidiary Company in capacity of Interim Managing
Director. Further, Whole-time Directors of the Company do not receive any remuneration or
commission from any of the subsidiaries.
> There are no proceedings, either filed by the Company or filed against the
Company, pending under the Insolvency and Bankruptcy Code, 2016 as amended, before
National Company Law Tribunal or other courts during the FY 2022-23.
> There was no instance of one-time settlement with any Bank or Financial
Institution.
ACKNOWLEDGEMENT
The Directors express their sincere gratitude to the Reserve Bank of India, Securities
and Exchange Board of India, BSE Limited, National Stock Exchange of India Limited,
Ministry of Finance, Ministry of Corporate Affairs, Regional Directors, Registrar of
Companies, other government and regulatory authorities, lenders, financial institutions
and the Company's Bankers for the ongoing support extended by them. The Directors also
place on record their sincere appreciation for the continued support extended by the
Company's stakeholders and trust reposed by them in your Company. The Directors sincerely
appreciate the commitment displayed by the employees of the Company and its subsidiaries
across all levels, resulting in successful performance during the year under review.
For and on behalf of the Board of Motilal Oswal Financial Services Limited
Sd/-
Raamdeo Agarawal Chairman
(DIN:00024533)
Place: Mumbai Date: April 27, 2023
Annexure 3 to the Board's Report