6thANNUAL REPORT 2018-19 Content 1. Corporate Information Pg. 3 2. Gosree Story Pg. 4 3. Brief profile of the Board & Management Pg. 6 4. Our Journey So Far Pg. 10 5. Notice of AGM and Directors’ report Pg. 13 6. Directors' Report for the year 2018-19 Pg. 20 7. Report on the Audit of the Standalone Financial Statements Pg. 62 8. Balance Sheet Pg. 68 9. Report on the Audit of the Consolidated Financial Statements Pg. 89 10. Consolidated Balance Sheet Pg. 93 11. Report on the Standalone Financial Statements Gosree Insurance Broking Pvt Ltd Pg. 113 12. Balance Sheet (Gosree Insurance Broking Pvt Ltd) Pg. 119 13. Report on the Standalone Financial Statements Gosreeinvestments & Risks Pvt Ltd Pg. 128 14. Balance Sheet (Gosreeinvestments & Risks Pvt Ltd) Pg. 134 Inauguration of new corporate office on 26th November 2018 In a function held at our new corporate office, adjacent to Oberron Mall, NH Byepass, Sri. Mohanachandran Nair, (Prasanthi Group, Kollam), the main promoter of the Company lighted the lamp followed by Sri. Sidharth Ram (Leo Group), M.G. Menon (Mampillikalam Group), Mrs. Chandrika Devi (formerly of RBI), CA Vishnu Prasad, Chandra Mohana Prasad Directors of the Company and Sri. G. Sreeram (Former MD of Dhanlakmi Bank). Sri. P.G. Jayakumar MD & CEO welcomed the gathering and Sri. T. S. Jagadeesan, MD proposed Vote of Thanks. Sri. Sambu Namboodiri (Associated Chemicals), Sri. Ranganathan (Finance Director, Eastern Group), CA Venugopal (Auditor of the Company M/S Krishnamoorthy & Krishnamoorthy) and the management & staff, customers and well- wishers of the Company were present. Annual Report 2018-19 CORPORATE INFORMATION Board of Directors Banks 1. GopalanKutty Menon Director & Chairman of the board 1. Federal Bank 2. Jayakumar. P.G Managing Director & CEO 2. Lakshmi Vilas Bank 3. T.S. Jagadeesan Managing Director 3. AU Small Finance Bank 4. T.S. Anantharaman Director 4. State Bank of india 5. R.K. Bhoodes Director 5. HDFC Bank 6. P. Chandrika Devi Director 6. ICICI Bank 7. Sidharth Ram Director 7. South Indian Bank 8. N. Govindan Director 9. Sriraag Subramonian Director Registrar & Transfer Agents 10. Chandra Mohana Prasad Independent Director Integrated Registry Management Services Pvt Ltd 11. Vishnu Prasad B Menon Independent Director 2nd Floor, Kences Towers No. 1 Ramakrishna Street, Company Secretary North Usman Road 1. Sripriya M Shenoy T Nagar, Chennai - 600 017. General Managers Debenture Trustee 1. G.S. Ajith Prasad- General Manager & CFO George Joseph 2. Ranjith T. K.- General Manager & Business Head 37/2038, Muttathil Lane Kadavanthra Other Executives Cochin - 682020 1. Sumeet C Menon- Asst. General manager 2. Gopakumar K- Chief Operating Officer Registered Office 3. V Hariharan- Chief Credit Officer Gosree Finance Limited 41/889-A3, Moopen Complex, Statutory Auditors NH Bypass Service Road, M/s Krishnamoorthy & Krishnmoorthy Padivattom, Edappally, KOCHI – 682024 Chartered Accountants, 39/3217, Paliam Road, Ernakulam, Kerala –682016 Disclaimer This document contains certain forward-looking statements, which are purely based on assessment of current economic, financial, social and political factors and environment by the Management of Gosree Finance. These factors are subject to change and would have significant impact on the outcome. Hence, this document should not be construed as an offer or recommendation to buy or sell any securities or products of the Company. 5 THE GOSREE STORY Kerala the ‘Gods own country’ is the home for several and started regular lending activity in December 2015 and successful scheduled commercial banks, NBFC’s and other is a continuously profit making Company. It has presently organised/unorganized financial institutions. Many of the a LOAN book of Rs. 66.00 crores. It has set up a wide DSA NBFCs which had humble beginning decades back grew in network to source loan proposals and has at present 5 geometrical progression and spread their wings across the branches; it has laid out detailed plans to expand its foot country offering a slew of unique products and services to the prints in the states of Kerala, Tamil Nadu and Karnataka people. All of them have grown to significant scale justifying within the next three years – Targeting around 40 branches. the confidence reposed in them by their stake holders. The Company has put in Centralised loan sanction, disbursal, It was in this background that Gosree Finance Limited was documentation and collection mechanism to build efficiency established in Cochin, the prehistoric city which hosted and of operations. Currently the Company has launched a accepted the Jews and Arabs and the western world as their product “SME Micro Loans” with individual loans ranging trading partners. from 1 to 5 lakhs to cater to the needs of smaller category of SME segment with attractive inbuilt features. The Company Gosree Finance was promoted by professionals from the is also focussing on medium SME segment to build its asset banking industry, Development bank, premier regulatory portfolio, which assets are mostly backed by mortgage of organization, Chartered Accountant fraternity and the commercial/residential/urban property. persons of high repute and integrity from the business community. They identified unmet credit needs of MSME The Company is working in a fully computerised environment segment and hoped to meet through the setting up of Gosree – Loan Origination System to be introduced. Finance. Despite priority sector lending requirements and verticals focused on MSME, micro finance etc, Indian banks The Company could get BBB- rating for its borrowing have largely been unable to meet the credit needs of the micro programme in the second year of operations itself, which SME segment, due to various reasons. The resource crunch was renewed last FY experienced by the micro SME segment has prompted these Company is following sound principles of financial businesses to go to informal and private sources of credit management and corporate governance standards and from usurious lenders and this has severely hampered the regulatory compliances in its journey to grow as a responsible growth of the micro SME business in India. all India financial institution tapping the huge opportunities At the same time, several Government initiatives like direct available in the fastest growing economy credit of Govt assistance to the accounts of beneficiaries, It’s a good People’s Organisation – believes in attracting, Ambitious programme of direct assistance to small and training, nurturing, retaining , rewarding and satisfying marginal farmers, Special focus on MSME sector which add growth aspirations of its employees to 40% of GDP and is the largest employer in the unorganised sector, thrust on PM Awas Yojana, large investments in Building a team of young professionals to take the company’s Infrastructure planned, Skill India programme etc are all fortunes forward, as part of Management succession plan expected to put money into the economy and to spur the Launched two subsidiaries (1) M/s.Gosree Insurance economic activities. It will increase the purchasing power of Broking Services Pvt Ltd, to do the Insurance Broking and the large segment of the common man also, which in turn Financial Services and (2) M/s.Gosree Investments and Risk will increase savings and investment. It is expected that the Services Pvt Ltd, to render Insurance Advisory and wealth renewed vigour introduced in the financial sector will take Management services. Also plan to diversify to Affordable our country to the USD 5 trillion economy, as planned. Housing Finance and Micro Finance segments, going Company commenced business formally in the month of forward. June 2015 after getting NBFC license from RBI on 28.01.2015, 6 Annual Report 2018-19 Mission To Protect interests of all stakeholders by delivery of excellent customer service through unique and transparent financial prod- ucts and solutions, by developing human resources through recognition, motivation and reward to the employees, by optimizing the returns to the shareholders and enhancing shareholder value and by giving back to the Society through value creation, enforce- ment of sustainable practices, respect to individuals and communities etc Vision To become Trusted partner for progress providing easy and quick access to finance. Key Strengths Efficiency of Operation The Company follows time tested procedures formulated by veteran Bankers and personnel from reputed financial institutions, regulatory body, and the industry, fine-tuned to the present needs. Products are introduced after extensive study by the experts in the segment which is the core strength of the company. We have robust credit monitoring and credit collection team in the field, working with the customers. All feedback will be through online process. Company is having good technology back up and legal support system to effectively manage the portfolio. We are continuously working to improve our Turnaround time to satisfy the customer needs. A strong balance sheet over the years is our goal. Plans to invest in emerging technology and process to enhance efficiency of operations. Also Company has plans to forey its operations in fintech domain. Human Resources A good people organization. We attract, train nurture and retain the talent to enhance the efficiency of the company. Participation and involvement of employee will be ensured by their improvement and providing them a part of the fruits of their contribution. Efforts are made to induce energy, enthusiasm and excitement about the organization. The goals of the company are aligned to the aspiration and progress of the employees. Company is in the process of instituting appropriate reward programmes for employees Corporate Governance To ensure strict compliance of regulatory norms and to safeguard the ethical values, Corporate Governance Policies are put in place with best practices as basic to this structure. It covers the entire activities of the company. 7 Brief profile of the Board & Management Mr. Jayakumar P. G., Managing Director & CEO of the company, holds Bachelor Degree of Science and CAIIB to his qualification.