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ABM Knowledgeware Ltd.

BSE: 531161 Sector: IT
NSE: N.A. ISIN Code: INE850B01026
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VOLUME 13323
52-Week high 180.00
52-Week low 109.00
P/E 12.20
Mkt Cap.(Rs cr) 232
Buy Price 0.00
Buy Qty 0.00
Sell Price 116.15
Sell Qty 6.00
OPEN 114.00
CLOSE 111.20
VOLUME 13323
52-Week high 180.00
52-Week low 109.00
P/E 12.20
Mkt Cap.(Rs cr) 232
Buy Price 0.00
Buy Qty 0.00
Sell Price 116.15
Sell Qty 6.00

ABM Knowledgeware Ltd. (ABMKNOWLEDGE) - Director Report

Company director report

To the Members of

ABM Knowledgeware Limited

Your Directors have pleasure in presenting the 24th Annual Report on the business andoperations of your Company along with the Audited Accounts for the financial year ended31st March 2017.

1. FINANCIAL PERFORMANCE OFTHE COMPANY (STANDALONE) :

The highlights of financial performance of your Company are as follows:

(In Rs. Thousand)

Particulars Year ended 31.03.2017 Year ended 31.03.2016
Gross Income 1125856 889405
Profit Before Interest and Depreciation 311547 289647
Finance Charges 2438 3067
Gross Profit 309109 286579
Provision for Depreciation 16898 16808
Net Profit Before Tax 292211 269771
Provision for Tax 101698 94061
Net Profit After Tax 190513 175711
Balance of Profit brought forward 876410 730792
Balance available for appropriation 1066923 876410
Proposed Dividend on Equity Shares - 25003
Tax on proposed Dividend - 5090
Transfer to General Reserve - -
Surplus carried to Balance Sheet 1066923 876410

2. OPERATIONS OF THE COMPANY:

Operations of the company have been generally stable during last year. Some regionslike Madhya Pradesh Bihar had seen increased activities due to advanced stage of projectimplementation. The total head count increased 6% against 26 % increase in gross revenuewhich shows encouraging trends of non-linear revenue growth. The business developmentteams have been strengthened by deputing business development resources to cover largernumber of states compared to last year. The focus to increase operational efficiency byautomating certain support functions by using Pay Per Use software has continued bycovering more operational areas. The Company continues to operate from offices in NewDelhi Patna Mumbai Bhopal and Chennai. Presence in other states like MP and Bihar isbeing leveraged to tap more business opportunities in these and nearby states. Company isexecuting projects of varying sizes in 11 different states compared to 6 states last year.

3. DIVIDEND:

Your Directors are pleased to recommend a Final Dividend of 25% (i.e.'1.25/-per EquityShare of Face Value of ' 5/- each) for the year ended 31st March 2017. Payment ofdividend is subject to the approval of shareholders at the forthcoming Annual GeneralMeeting and would involve a cash outflow of ' 30092710/- including dividenddistribution tax.

4. TRANSFER TO RESERVES:

No amount was proposed to be transferred to the reserve during the year under review.

5. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND:

Pursuant to the provisions of Investor Education and Protection Fund (AccountingAudit Transfer and Refund) Rules 2016 / Investor Education and Protection Fund(Awareness and Protection of Investors) Rules 2001 '153366/- of unpaid / unclaimeddividends were transferred during the year to the Investor Education and Protection Fund(IEPF).

The Company has already filed the necessary form and uploaded the details of unpaid andunclaimed amounts lying with the Company as on 12th August 2016 (date of last AnnualGeneral Meeting) on the website of the Ministry of Corporate Affairs.

6. SHARE CAPITAL:

As on 31st March 2017 the Authorized share capital of your Company was '125000000/-consisting of 25000000 Equity Shares of ' 5/- each and paid up equity share capital was'102415000/- consisting of 20002200 fully paid up equity shares and 697800forfeited equity shares of ' 5/- each.

During the year under review the Company has not issued any shares or Bonus shares.The Company has not issued shares with differential voting rights. It has neither issuedemployee stock options nor sweat equity shares. The Company has not bought back any of itsequity shares.

7. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP):

Mr. M. N. Ahmed a Non-Executive Director resigned from the Board of Director of theCompany with effect from 4th February 2017. The Directors place on record theirappreciation of the valuable contributions and guidance given by Mr. M. N. Ahmed duringhis tenure as a Member of the Board of Director of the Company.

In accordance with the provisions of the Section 152 of Companies Act 2013 Mrs.Supriya P. Rane Director retires by rotation at the forthcoming Annual General Meetingand being eligible offer herself for re-appointment. Board recommends her re-appointment.

A brief profile of Mr. Supriya P. Rane has been given in the Report on the CorporateGovernance as well as in the Notice of the ensuing Annual General Meeting of the Company.

Mr. Sharadchandra Abhyankar Mr. Sanjay Mehta and Dr. Sumit D. Chowdhury are theIndependent Directors on the Board of the Company. They have confirmed to the Company thatthey meet the criteria of independence as prescribed under Section 149 (6) of theCompanies Act 2013.

Every Independent Director of the Company is provided with on-going information aboutthe industry and the Company so as to familiarise them with the latest developments. Thedetails of programmes for familiarisation of Independent Directors with the Company theirroles rights responsibilities in the Company nature of the industry in which theCompany operates business model of the Company and related matters are put up on thewebsite of the Company at www.abmindia.com . TheCompany has issued a formal letter of appointment to each of the Independent Directors inthe manner as provided in the Companies Act 2013. The terms and conditions of theappointment have been disclosed on the website of the Company.

There has been no change in the Key Managerial Personnel (KMPs) of your Company duringthe year under review.

The policy on Director's appointment and remuneration including criteria fordetermining qualifications positive attributes independence of Director and alsoremuneration for Key Managerial Personnel and other employees forms part of the CorporateGovernance Report of this Annual Report. Annual Board Evaluation process for Directors hasalso been provided under the Report on Corporate Governance.

8. MEETINGS:

During the year six Board Meetings and five Audit Committee Meetings were convened andheld. For the details of the meetings of the Board and its Committees please refer to theReport on Corporate Governance which forms part of this report. The intervening gapbetween the Meetings was within the period prescribed under the Companies Act 2013.

9. PUBLIC DEPOSITS:

During the year your Company did not accept any public deposits under Chapter V ofCompanies Act 2013 and no amount on account of principal and interest on public depositswas outstanding on the date of the balance sheet.

10. SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES:

As on 31st March 2017 the Company does not have any Subsidiary Joint venture orAssociate Company. But during the year under review the Board of Directors have approveda strategic investment in Instasafe Technologies Private Limited ("Instasafe")and executed definitive agreements including Share Purchase Agreement Share Subscriptionand Shareholders' Agreement and related documents. Consequent upon the satisfactoryfulfillment of the condition precedent set forth in the said agreements the Company hasexercised its rights under the shareholders Agreement and accordingly Mr. Prakash B. Raneand Mr. Sanjay Mehta have been appointed as Nominee Directors on the Board of Instasafe.In view of the rights conferred on the Company by the said Shareholders Agreement and theArticles of Association of Instasafe and the nomination of non- executive directors onthe board of directors of the Instasafe Instasafe became a subsidiary of the Companyw.e.f.12th May 2017.

11. AUDITORS:

M/s. Borkar & Muzumdar Chartered Accountants were appointed as Statutory Auditorsof the Company at the Annual General Meeting held on 18th September 2014 for a term offive consecutive years. As per the provisions of Section 139 of Companies Act 2013 theappointment of Auditors is required to be ratified by Members at every Annual GeneralMeeting.

12. AUDITORS' REPORT:

The Report given by the Auditors on the Financial Statements of the Company is part ofAnnual Report. There has been no qualification reservation adverse remark or disclaimergiven by the Auditors in their Report. Hence it is an unmodified opinion in terms of theapplicable provisions of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. Notes to Accounts and Auditors remarks in their report areself-explanatory and do not call for any further comments.

13. SECRETARIAL AUDIT REPORT:

The Company has appointed Mr. Upendra Shukla Practicing Company Secretary to carry outthe Secretarial Audit for the financial year 2016-17 which inter alia includes audit ofcompliance with the Companies Act 2013 and the Rules made under the Act ListingRegulations and applicable Regulations prescribed by the Securities and Exchange Board ofIndia and Foreign Exchange Management Act 1999 and Secretarial Standards issued by theInstitute of the Company Secretaries of India.

The Secretarial Audit Report in Form No. MR-3 is annexure to this Annual Report. TheSecretarial Audit Report does not contain any qualification reservation or adverseremark.

14. COMPLIANCE WITH SECRETARIAL STANDARDS:

The Company has complied with Secretarial Standards issued by the Institute of CompanySecretaries of India on Board Meetings and General Meetings.

15. INTERNAL AUDIT AND INTERNAL CONTROL SYSTEMS:

The Company has appointed M/S. S.P Sule & Associates Chartered Accountants asInternal Auditor of the Company for the financial year 2016-2017.

The Company's internal control systems are commensurate with the nature and size of itsbusiness operations. These systems ensure that transactions are authorized recorded andreported diligently to safeguard the assets of the Company. Internal Audit was conductedin various areas of operations of the Company. The internal audit process includes reviewand evaluation of effectiveness of existing processes internal controls and compliances.It also ensures adherence to policies and systems and mitigation of operational risksperceived for each area under audit. The Management duly considers and takes appropriateaction on recommendations made by the Statutory Auditors Internal Auditors and AuditCommittee of the Board of Directors.

16. CORPORATE GOVERNANCE:

Sound Corporate Governance is a key driver of sustainable corporate growth andlong-term value creation for the stakeholders and protection of their interests. YourCompany endeavours to meet the growing aspirations of all stakeholders includingshareholders employees and customers. Your Company always strives to follow the path ofgood governance through a broad framework of various processes. Your Company has compliedwith the governance requirements provided under the Companies Act 2013 and listingregulations.

A separate Report on Corporate Governance together with Auditor's Certificateconfirming compliance with the conditions of Corporate Governance as stipulated underSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 is annexed to this Report.

17. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

A. Industry Structure and Development:

Industry structure has remained unchanged for past several years. The competition isdivided into regional players and national players. Some regions have experiencedincreased competition last year with unviable prices being quoted in tenders. The schemesrelevant to your company's business like Smart City with almost '100000 crore outlayover five years has reached stages of tendering. Funding under some central govt schemesand 14th Finance Commission mandates automation and reforms. This is also resulting intomore tenders from Urban sector which is one of the important customer segment for yourcompany. Some of the IT companies which showed impractical aggressiveness have facedserious consequences due to failure to appreciate nuances of e government business whichrequire par excellence techno-functional capabilities. The key stakeholders in thisindustry continue to be government organizations and its employees; Consulting Companiesappointed by Government organizations for firming up tenders and its evaluation; ProjectManagement Companies appointed by Government organizations for monitoring projectexecution; Funding agencies like Central Government or International Funding agencies likeWord Bank (WB) The Asian Development Bank (ADB) The Department for InternationalDevelopment of United Kingdom Government (DFID) The Japan International CooperationAgency of Government of Japan (JICA) etc. and IT companies who execute the projects.

There have been some chronic issues with Government contracts in the industry whichcontinue to remain concerns for the industry. Efforts are being done by industryassociations like The National Association of Software and Services Companies (NASSCOM) toconvince Government to have more balanced procurement process. Government has issued modeltender document which address some of the concerns flagged by NASSCOM. IT dependentinitiative like Ease of Doing Business Right to Services Digital India Atal Mission forRejuvenation and Urban Transformation (AMRUT) are showing more traction for IT spending.

Post demonetization the overall usage of IT interfaces in day to day work by commoncitizen is on rise and it will help in increased demand for e government in medium to longterm due to better appreciation of IT.

B. Existing Opportunities and Outlook:

Your company has been following a specific strategy for leveraging businessopportunities in e government business segments. It includes long term relationships withcustomers by giving increasingly better quality of service adding verticals periodicallyby organic and inorganic strategies adding more states as customers blending technologywith reforms maintaining proper processes and a sound value system. This has resultedinto steady growth as seen from past performance.

The opportunities in the segment are abundant and choice needs to be made based on whathas maximum fitment with company strengths and growth strategies. Company continues tofocus on successful completion of each project for building long term relationships inareas of its strength like Urban Sector Reforms in Accounting and Tax revenue SAPTourism. The recent acquisition of a cybersecurity firm based in Bangalore would open newavenues of account mining and will increase the solutions offerings by the Company.

The global industry is fast embracing technologies like Artificial Intelligencemachine learning analytics virtual and augmented reality block chain etc. Company willmonitor these trends closely and its impact on the Company's market segment and solutionsoffered by the Company. Company has been developing its flagship offerings by followingDigital India guidelines and standards.

As per Gartner (Source: All Press Release on February 13 2017 on Gartner Website) thegovernments in India would spend $7.8 billion (9.5 percent growth over previous year) onIT products and services last year. This included spending on internal services softwareIT services data centers devices and telecom services by local state and Uniongovernments. IT services would include consulting software support business processoutsourcing IT outsourcing and implementation.

As per data available in public domain and announcements from concerned ministries itcan be estimated that total outlay for 5 years in schemes like Smart City Some MissionMode Projects Digital India Atal Mission for Rejuvenation and Urban Transformation(AMRUT) National Heritage City Development and Augmentation Yojana (HRIDAY) etc. would be' 250000 crore. Considering the composition of projects being awarded so far the ITportion(software IT services data centers devices and telecom services) would be about20% of the total outlay. Rest would be towards improvement of Urban Infrastructure. Out of20% of the IT portion the services relevant to your company can be estimated to be around50% of this 20% amounting to approximately ' 5000 crore per annum. It may be noted thatthese are approximations.

C. Business Threats:

As we have been outlining in most of the annual reports the company faces various risksand threats associated with e government business. It includes possible payment delaysTime and Cost overruns Disruptions in the project when head of the organization ischanged challenges in attracting good talent to work in less developed states and ininterior regions of India etc. You company has been adopting a cautious approach ofbuilding business brick by brick rather than a big bang approach. Of late Your companyhas grown its business to twice the number of states compared to last year. This increasesthe possible impact of these threats. ABM has been practicing stringent processes tomitigate the risks and has been successful in doing so.

Inexperienced competition remains a threat and results into loosing some of theopportunities. Some of the long term contracts of Company may be coming to an end thisyear causing some concerns on topline as well as bottom line. Efforts are underway tobuild new prospects to keep same momentum as exhibited in previous years.

D. Business Strategies and Planning:

The core strategy of the company remains by and large unchanged. It involves workingclosely with existing prestigious customers and retaining them and targeting newergeographies for promoting niche offering of the company. ABM also has been selectivelyadding to its core offerings wherever a high replication potential to other customers isperceived.

ABM has established its presence in states in North South West and East India bywinning prestigious customers in these regions. A strategy of collaboratively working withlarge and reputed IT companies in consortium has yielded positive results and the strategyhas been be deepened further by partnering with reputed companies like L and T in somesmart city tenders.

E. Human Resource Management:

i) Aim of Human Resource Management

• To enable ABM to attract integrate develop and retain the best talent todeliver business growth.

• Fulfill business demand deliver consistently high utilization rates and keepmanpower costs within the desired range as per Business plan.

• Deploy meaningful practices to enhance the engagement capability andcompetitiveness of our workforce.

ii) Achievements

The above aims were fulfilled to a large extent. The Talent Acquisition department hasdone a marvelous job of recruiting within Turn-Around Time (TAT) for the MP project.Employee Relationship was given higher focus during the year due to increased spread ofemployees across India and need to integrate them within ABM culture.

ii) Headcount

Year Current Headcount
April 2015 - March 2016 720
April 2016 - March 2017 769

iv) HR Events

• Successful Employee Connect conducted at many locations.

• Organized Medical CAMP as an awareness towards one's health.

• "Think Creative and Act Creative" challenge was endorsed to hunt thehidden talent within the team and encourage team bonding amongst the tech gigs.

v) Recognition

• Career Enhancement opportunities

• Recognized as a process which enable the Company to be agile responsive to thedynamic environment and stay relevant to its customers.

• Hire talented Professional Graduates from the reputed universities andInstitutes.

vi) Motivational and Focus Areas

• The Company continues to invest in the form of training for enhancing its HumanCapital by providing opportunities to its employees to develop their skills andcompetencies relevant to the business requirements.

• We follow Equal Opportunities & Non Discrimination Policy and do notdiscriminate on basis of race colour gender caste or religion.

• The Company's relentless pursuit to connect with employees on a regular basiscommunicate in an open and transparent manner provide opportunities to learn and growwithin the organization are yielding desired results as is evident from the high retentionrate and the motivation and engagement levels of the employees.

F. Discussion on financial performance with respect to the operational performance:

(In Rs. Thousand)

Year ended Year ended
31.03.2017 31.03.2016
Gross Income 1125856 889405
Less: service Tax 145926 98614
Gross Income (net of Service Tax) 979930 790791
Less: Total expenditure 670821 504211
Gross profit before Depreciation & Taxation 309109 286579

The Gross Income of the Company has increased compared to last year and improvement inthe profits is also seen. Last year Company has implemented and gone live in some majorprojects causing some stretch on profitability.

18. RISK MANAGEMENT:

The Company has developed and adopted a Risk Management Policy. This policy identifiesall perceived risk which might impact the operations and on a more serious level alsothreaten the existence of the Company. Risks are assessed department wise such asfinancial risks information technology related risks legal risks accounting fraud etc.The Risk Management Committee assists the Board in fulfilling its corporate governanceoversight responsibilities with regard to the identification evaluation and mitigation ofoperational strategic and external environment risks. The Committee also ensures that theCompany is taking appropriate measures to achieve prudent balance between risk and rewardin both ongoing and new business activities.

The details of the Committee and its terms of reference are set out in the CorporateGovernance report forming part of this report.

The following elements of risks which in the opinion of the Board can impact theperformance of the company.

1. Industry: Industry risks are competition newer business models like PPP anddisruptive technologies like Artificial Intelligence Machine Learning Virtual Reality(VR) and Augmented Reality (AR) Automation etc. Company has been monitoring the impact ofthese new technologies carefully. ABM has been working on deepening its roots into itscore areas to create more entry barriers to competition as well as working closely withexisting clients to give superior service and value. ABM is working with larger companiesfor consortium based bidding to prepare for opportunities like smart city where muchstronger financial upfront investment is required for the project.

2. Supply side risk for talent acquisition: With growing customer base and missioncritical projects unavailability of right skilled resources at right time in rightquantity can pose a risk. The Company constantly trains and re-trains existing resourcesfor different skills and technologies. Suitable HR practices are adopted to minimise theattrition rate. Lateral hiring is done to bring in fresh leaders.

3. Cost pressures: Increasing operations expenses as well as rising employee cost canpose risk to the Company. The company has internal controls to monitor costs and escalateany abnormal increase for taking corrective actions. Project level and Business Unit levelcosts are monitored through a regular MIS on budgets and variances for timely correctiveaction.

4. Operational efficiency: The operational risk is mainly associated with clientacquisition execution of projects information security and continuity of customer'sbusiness operations. The company has project level monitoring where such risks areidentified and escalated to board for suitable corrective measures on time.

5. Reputation: The Company's projects are in Government sector which are necessarilyfunded by public finance. This may expose the Company to the risk of motivated publicscrutiny from elements which are adversely affected by success of project leading totransparency as well as some times by competition. The Company strictly follows theGovernment processes of procurement and executes the projects with highest possiblestandards of ethics and best industry processes. Employees are made well aware of theCompany policy and ensure the proper code of conduct is followed across projectsuniformly. Company has published its own code of conduct for benefit of employees. Thishas been helping company so far to win over the confidence of customers even in thesituations of motivated public scrutiny which is aimed at hurting reputation of theCompany.

19. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTSRELATE AND THE DATE OF THE REPORT:

There are no material changes or commitments made by Company that will affect thefinancial position of the company during the above mentioned period except the investmentcommitment upto ' 15 crores for investment of cybersecurity firm as informed to the BSE on24thJanuary 2017.

20. CODE OF CONDUCT:

The Company has adopted the Code of Conduct and ethics for all Board Members and SeniorManagement and this is strictly adhered to. A copy of the Code of Conduct is available onthe website of the Company www.abmindia.com . In addition members of the Board and SeniorManagement also submit on an annual basis the details of individuals to whom they arerelated and entities in which they hold interest and such disclosures are placed beforethe Board. The members of the Board inform the Company of any change in theirdirectorship(s) chairmanship(s) / membership(s) of the Committees in accordance with therequirements of the Companies Act 2013 and Listing Regulations.

The members of the Board and Senior Management have affirmed their compliance with thecode and a declaration signed by the Managing Director is annexed to this report.

21. AUDIT COMMITTEE COMPOSITION:

During the year all the recommendations of the Audit Committee were accepted by theBoard. The Composition of the Audit Committee is as described in the Corporate GovernanceReport which forms part of this report.

22. VIGIL MECHANISM:

Pursuant to the provisions of Section 177(9) of the Act and rules made thereunder theBoard of Directors had approved the Policy on Vigil Mechanism / Whistle Blower Policy toprovide a mechanism for the Directors and employees to report their grievances genuineconcerns about unethical behaviour actual or suspected fraud and violation of theCompany's Code of Conduct. This Policy inter-alia provides a direct access to the Chairmanof the Audit Committee.

Brief details about the policy are provided in the Corporate Governance Report attachedto this Report. The Whistle Blower Policy is available on the website of the Company.

23. PREVENTION OF INSIDER TRADING:

In compliance with the SEBI regulations on prevention of insider trading the Companyhas in place (1) (i) a Code of Conduct to Regulate Monitor and Report Trading byInsiders the disclosure requirements and procedure thereto Preservation of PriceSensitive Information Trading while in possession of unpublished Price SensitiveInformation Prevention of misuse of Price Sensitive Information etc.; and (2) a Code ofPractices and Procedures for Fair Disclosure of Unpublished Price Sensitive Informationdetailing the principles of fair disclosure. The same has been circulated to Directors anddesignated employees of the Company. They are regularly reminded about their obligationunder the policies and also informed about prevention of insider trading into thesecurities of the Company.

The Company Secretary is responsible for implementation of the Code. All Board ofDirectors and the designated employees have confirmed compliance with the Code.

24. RELATED PARTY TRANSACTIONS:

In line with requirement of the Companies Act 2013 and Listing Regulations yourCompany has formulated a Policy on Related Party Transactions which is also available atCompany's website www.abmindia.com . The Policy intends to ensure that proper reportingapproval and disclosure processes are in place for all transactions between the Companyand Related Parties.

All related party transactions are placed before the Audit Committee for approval.Prior omnibus approval of the Audit Committee is obtained on an annual basis which isreviewed and updated on quarterly basis.

All Related Party Transactions entered during the year were in Ordinary Course of theBusiness and on Arm's Length basis. No Material Related Party Transactions i.e.transactions exceeding ten percent of the annual turnover as per the last auditedfinancial statements were entered during the year by your Company. Accordingly thedisclosure of Related Party Transactions as required under Section 134(3) (h) of theCompanies Act 2013 in Form AOC 2 is not applicable.

25. EXTRACT OF ANNUAL RETURN:

As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of annual return in MGT9 is appended as an Annexure to this Annual Report.

26. CORPORATE SOCIAL RESPONSIBILITY:

In accordance with the requirements of Section 135 of Companies Act 2013 your Companyhas constituted a Corporate Social Responsibility Committee. The composition and terms ofreference of the Corporate Social Responsibility Committee is provided in the CorporateGovernance Report. Your Company has also formulated a Corporate Social ResponsibilityPolicy which is available on the website of the Company.

The brief outline of the Corporate Social Responsibility (CSR) Policy of the Companyand the initiatives undertaken by the Company on CSR activities during the year are setout in Annexure of this report in the format prescribed in the Companies (Corporate SocialResponsibility Policy) Rules 2014.

27. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:

There were no loans guarantees or investments made by the Company under Section 186 ofthe Companies Act 2013 during the year under review.

28. PREVENTION OF SEXUAL HARASSMENT (POSH) AT WORKPLACE:

The Company has zero tolerance towards sexual harassment at the workplace and towardsthis end has in place a Policy for prevention of Sexual Harassment in line with therequirements of the Sexual Harassment of Women at Workplace (Prevention Prohibition &Redressal) Act 2013. While maintaining the highest governance norms the Company has setup Internal Complaints Committee to redress complaints received regarding sexualharassment. While maintaining the highest governance norms the Company has appointedexternal independent person who has done work in this area and has requisite experiencein handling such matters as member this Committee. The Policy aims to provide protectionto all employees at the workplace and prevent and redress complaints of sexual harassmentand for matters connected or incidental thereto with the objective of providing a safeworking environment where employees feel safe and secure.

The Company has not received any complaint of sexual harassment during the financialyear 2016-17. In order to build awareness in this area the Company has been conductingprogrammes in the organisation on a continuous basis.

29. PARTICULARS OF EMPLOYEES:

Disclosures with respect to the remuneration of Directors and employees as requiredunder Section 197 of Companies Act 2013 and Rule 5 (1) Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 has been appended as Annexure to thisReport. The details of employee remuneration as required under provisions of Section 197of Companies Act 2013 and Rule 5(2) and 5(3) of Rules for the year ended 31st March 2017is also annexed to this report.

30. CONSERVATION OF ENERGY:

Your Company consumes energy mainly for the operation of its software development thusthe consumption of electricity is negligible. In order to conserve the electricity theair conditioners are kept at a moderate temperature and all the electrical equipments areturned off whenever they are not required by the office staff.

31. TECHNOLOGY ABSORPTION ADOPTION & INNOVATION AND RESEARCH AND DEVELOPMENT:

Your Company has continued its focus on 'Productisation of Services' by innovativebusiness models. Company is putting in efforts to adopt the latest technologies to addressthe demand for "Digital Business". The flagship products of the company haveprogressed well with respect to upgradation to the latest technology for reducing thetotal cost of ownership for customers and becoming more competitive in market.

32. FOREIGN EXCHANGE EARNINGS AND OUTGO:

Your company did not have any Foreign Exchange earnings or outgo in last year.

33. LISTING FEES:

Your Company's shares are listed in The Bombay Stock Exchange Limited Mumbai and theAnnual Listing fees for the year under review have been paid.

34. DIRECTORS' RESPONSIBILITY STATEMENT:

The Directors hereby confirm that:

a) in the preparation of the annual accounts the applicable accounting standards havebeen followed and that no material departures have been made from the same;

b) they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year and of the Profitor Loss of the Company for that period;

c) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

d) they have prepared the Annual Accounts on a going concern basis;

e) they have laid down internal financial controls for the Company and such internalfinancial controls are adequate and operating effectively; and

f) they have devised proper system to ensure compliance with the provisions of allapplicable laws and such systems are adequate and operating effectively.

35. ACKNOWLEDGEMENT:

Your Board places on record its heartfelt appreciation to the dedicated efforts and hadwork put in by the employees at all levels. The Company's consistent growth is a testimonyto their dedication and commitment. Your Board takes this opportunity to express sincerethanks to its valued customers for their continued patronage over the years.

Your Board acknowledges the contribution of bankers and business and technologypartners Auditors Legal Advisors Training Institutes the Registrars GovernmentAuthorities Regulatory Bodies etc. who have always supported and helped the Companyachieve its objectives and look forward for their continued support in future.

We also thank the shareholders for their continued trust and confidence bestowed on theCompany.

For and on behalf of the Board

Date : 20th May 2017 Prakash B. Rane Sharadchandra Abhyankar
Place: Mumbai Managing Director Director
(DIN: 00152393) (DIN:00108866)