**Trustwave Securities Limited** (formerly **Sterling Guaranty & Finance Limited**) is a Mumbai-based financial services firm currently undergoing a comprehensive strategic and structural transformation. Following a change in management and control in **2024**, the company has pivoted from its legacy as a Non-Banking Financial Company (**NBFC**) to a specialized entity focused on **proprietary trading**, **distressed asset management**, and **corporate advisory**. --- ### **Corporate Evolution & Regulatory Status** The company has executed a series of foundational changes to align its corporate identity with its new operational mandate. | Feature | Details | | :--- | :--- | | **Current Name** | **Trustwave Securities Limited** (Effective **August 9, 2024**) | | **Former Name** | Sterling Guaranty & Finance Limited | | **Listing Status** | Listed on **BSE Limited** (Scrip Code: **511573**) | | **NBFC Status** | **Cancelled**; RBI confirmed cessation of NBFC activity on **December 15, 2023** | | **Management Control** | Transitioned in **2024** to **Mr. Deepak Babulal Kharwad** | | **Registered Office** | Neelkanth Business Park, **Vidyavihar (West), Mumbai** | The company voluntarily surrendered its NBFC license after having no active NBFI operations since **FY 2015-16**. It now operates under a single reportable segment: **Investment and Consultancy**. --- ### **Core Business Pillars & Revenue Drivers** The firm leverages over **50 years of cumulative market experience** to execute a three-pronged business model: #### **1. Proprietary Trading & Arbitrage** The company conducts investment activities on a **prosperity basis**, utilizing internal capital rather than third-party funds. * **Market Focus:** Active tracking of **Nifty 50** and **Sensex** constituents based on price volatility and news events. * **Execution:** Participation in the **Cash Market**, **Derivatives**, **IPOs**, and **Private Placements**. * **Arbitrage Strategy:** Specializes in **Cash-Future Arbitrage** to capture the "Basis" (price discrepancy). Typical capital allocation ranges from **₹3 Lakhs to ₹5 Lakhs** per arbitrage unit, with positions squared off near derivative expiry. * **Risk Mitigation:** Employs **delivery-based holding**, **averaging**, and **hedging** strategies if market movements deviate from expectations. #### **2. Stressed Asset Management** A new strategic mandate authorizes the acquisition of **Non-Performing Assets (NPAs)** from banks and financial institutions. * **Acquisition Channels:** Direct negotiation, tenders, and participation in **Insolvency and Bankruptcy Code (IBC)** proceedings. * **Value Creation:** Focuses on capital restructuring, management changes, and operational turnarounds. * **Support Services:** Provides **skip tracing**, field investigations, and recovery facilitation for institutional lenders. #### **3. Legal & Corporate Advisory** The firm provides high-level consultancy to ensure compliance with **MCA, SEBI, RBI, and Income Tax** regulations. * **Structural Advisory:** Expertise in **Mergers, De-mergers, Amalgamations**, and schemes of arrangement. * **Regulatory Compliance:** Guidance on **FEMA**, **Foreign Direct Investment (FDI)**, **External Commercial Borrowings (ECB)**, and **GST**. * **Wealth Management:** Specialized valuation services and fairness opinions for **High Net Worth Individuals (HNIs)**. --- ### **Strategic Restructuring: The Capital Reduction Scheme** To address historical financial baggage and prepare for fresh capital infusion, the company is implementing a drastic **95% reduction** of its fully paid-up equity share capital (initiated for **2025-2026**). | Particulars | Pre-Reduction (March 2024) | Post-Reduction (Pro-forma) | | :--- | :--- | :--- | | **Total Paid-up Capital** | **INR 6.54 Crore** | **INR 32.69 Lakh** | | **Number of Equity Shares** | **65,37,600** | **3,26,880** | | **Face Value per Share** | **INR 10** | **INR 10** | | **Accumulated Losses** | **INR (7.30) Crore** | **INR (1.09) Crore** | **Strategic Objectives:** * **Clean Slate:** Writing off **INR 7.30 Crore** in accumulated losses to present a "true and fair" balance sheet. * **Financial Ratios:** Improving **Return on Equity (ROE)** and **Earnings Per Share (EPS)** to attract new investors. * **Dividend Path:** Offsetting losses is a prerequisite for future dividend distributions. --- ### **Financial Performance & Health Indicators** The company is currently in a "rejuvenation" phase, characterized by low revenue and high restructuring costs. * **Profitability:** Reported a net loss of **INR 17.09 lakhs** for FY 2024-25, widening from a loss of **INR 7.44 lakhs** in FY 2023-24. * **Net Worth:** Stood at **INR (93.59) lakhs** as of March 31, 2025. * **Valuation:** A **2024** fair value assessment certified the equity share value at **INR (1.45)** per share. * **Liquidity:** The company maintains an interest-free loan of **INR 70.00 lakhs** from **Sterling Investments (India) Ltd.** to support operations. * **Promoter Holding:** Currently stands at **47.69%**, with **100%** of these shares dematerialized. --- ### **Risk Factors & Investment Considerations** Investors should weigh the following risks associated with the company’s transition: * **Regulatory Hurdles:** The **RBI's cancellation** of the NBFC license followed a "lack of supervisory comfort" regarding the change in ownership. Future growth depends on successfully navigating new regulatory frameworks. * **Operational Resource Gaps:** The company has explicitly identified a **lack of resources** as a primary internal risk. It currently relies on a lean management team to rebuild its core business. * **Market & Credit Risks:** As a proprietary trader, the firm is highly exposed to **interest rate fluctuations**, **liquidity risk**, and systemic market volatility. * **Execution Risk:** The pivot to **Stressed Assets** requires significant capital and legal expertise. Success in the **NCLT/IBC** landscape is highly competitive and time-intensive. * **Governance Exemptions:** Under **LODR Regulation 15(2)(a)**, the company is exempt from certain Corporate Governance provisions because its paid-up capital is below **INR 10 Crores** and net worth is below **INR 25 Crores**. ### **Management Outlook** Led by **Naliny Deepak Kharwad** (MD) and **Deepak Babulal Kharwad** (Chairman), the new leadership is focused on "quick wins" to demonstrate improved performance. The long-term goal is to leverage the leaner capital structure to secure strategic partnerships and scale the proprietary trading and distressed asset desks.