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AXISCADES Engineering Technologies Ltd.

BSE: 532395 Sector: IT
NSE: AXISCADES ISIN Code: INE555B01013
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VOLUME 96761
52-Week high 346.50
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P/E 21.96
Mkt Cap.(Rs cr) 509.22
Buy Price 0.00
Buy Qty 0.00
Sell Price 187.35
Sell Qty 220.00
OPEN 192.05
CLOSE 191.50
VOLUME 96761
52-Week high 346.50
52-Week low 133.50
P/E 21.96
Mkt Cap.(Rs cr) 509.22
Buy Price 0.00
Buy Qty 0.00
Sell Price 187.35
Sell Qty 220.00

AXISCADES Engineering Technologies Ltd. (AXISCADES) - Director Report

Company director report

To

The Members

Your Directors have pleasure in presenting the 26th Annual Report on the business andoperations of the Company together with the Financial Statements of the Company for thefinancial year (FY) ended March 31 2016. The Consolidated performance of the Company andits subsidiaries has been referred to wherever required.

1. FINANCIAL RESULTS

(Rs Million)

Particulars Standalone Consolidated
2015-16 2014-15 2015-16 2014-15
Total Income 2380.00 1895.71 3793.07 3192.43
Total expenditure (before interest & depreciation) 1867.97 1590.45 3219.44 2757.70
Earnings before interest depreciation amortization and extra-ordinary items 512.03 305.26 573.63 434.73
Interest & finance charges 17.85 23.03 18.37 23.53
Depreciation & amortization 92.46 80.43 101.86 93.36
Earnings before Tax and Exceptional Items 401.72 201.80 453.40 317.84
Exceptional item 5.93 29.71 5.93 29.71
Profit before Tax (PBT) 395.79 172.09 447.47 288.13
Provision for Tax – Current & Deferred 132.99 58.85 157.60 90.06
Net Profit after Tax (PAT) 262.80 113.24 289.87 198.07
Minority Interest 0.00 0.00 4.07 3.96
Profit for the period 262.80 113.24 285.80 194.11

PERFORMANCE REVIEW

The Company continued to be engineering partners to clients in aerospace heavyengineering industrial products and auto industry and recorded growth both in terms ofrevenues and profitability. The improved earnings reflect focus on efficiency in operationin FY2016 enabling the company to invest for growth. The Company continued to invest inbuilding a strong leadership team a larger and more focused sales team and newrecruitments of subject matter experts from industry to scale up the practice line. Theseinvestments together with focus on delivering customer value has laid down a solidplatform for accelerated growth in the future. The Company also worked arounddiversification of its offerings across new sectors and geographies and strengthening ofinternal systems and processes. In line with the company’s strategy to diversify intonewer industry sectors during the year the company has set up Offshore Development Centrefor Siemens Wind Power at Hyderabad. The centre started with 50 engineers and will growover time as both the companies explore new technical areas of providing offshore valueaddition. With this long-term partnership AXISCADES aims to further solidify its positionin the energy sector.

FINANCIAL HIGHLIGHTS – STANDALONE

Total Income increased by 25.55% to Rs 2380.00 million in 2015-16. EBIDTA increased by67.74% to Rs 512.04 million in 2015-16. Profit before tax and exceptional items increasedby 99.07% to Rs 401.72 million in 2015-16. Net Profit after tax increased by 132.07% to Rs262.08 million in 2015-16.

FINANCIAL HIGHLIGHTS – CONSOLIDATED

Total Income increased by 18.81% to Rs 3793.07 million in 2015-16. EBIDTAincreased by 31.95% to Rs 573.63 million in 2015-16. Profit before tax and exceptionalitems increased by 42.65% to Rs 453.40 million in 2015-16. Net Profit after tax increasedby 46.35% to Rs 289.87 million in 2015-16.

RESERVES

The Company has not transferred any amount to its reserves for the Financial Year endedMarch 31 2016.

DIVIDEND

Considering need for conservation of funds for catering to the immediate growth plansof the company your Directors consider it expedient to pass over dividend for 2015-16.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

Loans guarantees and investments covered under Section 186 of the Companies Act 2013form part of the Notes to the financial statements provided in the Annual Report.

PUBLIC DEPOSITS

The Company has not accepted/renewed any public deposits and as such no amount onaccount of principal or interest on public deposits under Section 73 of the Companies Act2013 read with Companies (Acceptance of Deposits) Rules 2014 was outstanding as on thedate of the Balance Sheet.

ISSUE AND LISTING OF SHARES

The company’s shares are listed on BSE Limited (BSE) and National Stock Exchangeof India Limited (NSE). Stock performance and stock data are furnished in the section onCorporate Governance.

During the year the Company has not issued any shares and therefore there is no changein the Share Capital of the Company.

Pursuant to the SEBI (Listing obligations and Disclosure Requirements) Regulations2015 effective from December 1 2015 the Company entered into listing Agreement with BSELimited and National Stock Exchange of India Limited.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

The particulars of contracts or arrangements with related parties referred to insection 188(1) of the Companies Act 2013 are furnished in the prescribed form AOC 2 asAnnexure I to this Report. All transactions with the related parties during the financialyear were in the ordinary course of business and at arm’s length basis. Thetransactions have been approved by the Audit Committee and the Board. Your attention isdrawn to the Notes to the financial statement.

The Company has not entered into any transaction with related parties which can beconsidered material in accordance of with the policy of the Company on material relatedparty transactions formulated as per the requirements of Listing Agreement. The

Policy on materiality and dealing with related party transactions formulated andapproved by the Board is posted on the website of the Company and is accessible atwww.axiscades.com

MATERIAL CHANGES AND COMMITMENTS

There were no material changes and commitments affecting the financial position of theCompany occurred between the financial year end and the date of this report. However theCompany has filed a Scheme of Amalgamation with the Honorable High Court of Karnatakadetails of which is as given below:

Scheme of Amalgamation:

The Board of Directors of the Company has approved the acquisition of AXISCADESAerospace & Technologies Pvt. Ltd. (ACAT) an aerospace defence and homeland securitytechnologies company by way of a Scheme of Amalgamation of its Holding Company namelyIndia Aviation Training Institute Pvt. (IAT) with the Company.

The shareholders of IAT will receive 10(ten) equity shares in ACET for every 5(five)shares held by them in IAT. The appointed date of the Scheme is 1st April 2016 or anyother date as may be directed by the Hon’ble Court of Karnataka. The Scheme has gotthe approval from the shareholders and creditors on 25th April 2016 in the Court ConvenedMeeting.

MANAGEMENT DISCUSSION AND ANALYSIS

In terms of the provisions of Regulation 34 of the Securities and Exchange Board ofIndia (Listing Obligation and Disclosure Requirements) Regulation 2015 a detailed chapteron Management Discussion and Analysis highlighting the Company’s strategy businessenvironment operations performance risks and outlooks is provided separately in thisAnnual Report.

2. BUSINESS STRUCTURE

SUBSIDIARIES

The Company has the following subsidiaries:

Overseas Subsidiaries

Name of the subsidiary Location/Country
1 Axis Inc. Peoria Illinois USA
2 AXISCADES UK Ltd. (formerly Axis EU Europe Ltd.) Leicestershire UK
3 AXISCADES Technology Montreal Quebec
Canada Inc. (Formerly Cades Technology Canada Inc.) Canada
4 Axis Mechanical Engineering Design (Wuxi) Co Ltd Wuxi City China

Indian Subsidiary

Sl. No. Name of the subsidiary Location/Country
1 Cades Studec Technologies (India) Private Limited Bengaluru India

All overseas subsidiaries are wholly owned by the Company. In case of Indiansubsidiary the Company holds 76% of its equity shares.

There are no associate companies within the meaning of section 2(6) of the CompaniesAct 2013.

A report on the performance and financial position of each of the subsidiaries as perrule 8(1) of Companies (Accounts )Rules 2014 is furnished under the statement containingsalient features of financial statements of subsidiaries in AOC 1 is attached to thisReport as Annexure II pursuant to Section 129(3) of Companies Act 2013.

In accordance with the provisions of Section 136 of the Companies Act 2013 theaudited financial statements of subsidiaries have been placed on the Company’swebsite at www.axiscades.com. The copies of these documents will be sent if requested byany shareholder of the Company/ subsidiary interested in obtaining the same. Thesedocuments will also be made available for inspection at the Registered Office of theCompany during business hours on working days.

CONSOLIDATED FINANCIAL STATEMENTS

Pursuant to the provisions of Section 129(3) of Companies Act

2013 read with Accounting Standards (AS) 21 23 and 27 the audited ConsolidatedFinancial Statements are furnished in the Annual Report.

CHANGE IN THE REGISTERED OFFICE OF THE COMPANY

The Registered office of the Company was shifted from New Delhi to the state ofKarnataka at Block C 2nd Floor Kirloskar Business Park Bengaluru-560024 with effectfrom December 2 2015 with necessary statutory approvals.

3. ORGANIZATION DEVELOPMENT

BOARD OF DIRECTORS

Retirements and Reappointments

In the ensuing Annual General Meeting Mr. Kedarnath Choudhury and Mr. RohitasavaChand Directors retire by rotation and being eligible offer themselves forre-appointment The Directors recommend their re-appointment at the ensuing Annual GeneralMeeting.

All the Independent Directors were appointed by the shareholders either at the previousannual general meeting or by Postal Ballot pursuant to Section 149(10) of Companies Act2013 and no independent director is liable to retire at the ensuing Annual GeneralMeeting (AGM).

As part of leadership development Mr. Sudhakar Gande was inducted as the ExecutiveDirector in the capacity of Vice Chairman of the Company with effect from August 14 2015for a period of five years.

Induction and cessation of Directors and KMP

Sl. No. Name of the Director Category Date of Appointment Date of Approval by Shareholder Date of Resignation
1 Mr. Sudhakar Gande Vice Chairman & Executive Director 14.08.2015 07.09.2015 NA
2 Mr. Kaushik Sarkar Director 12-09-2014 12-01-2015 25-06-2015*
3 Ms. Vimmi M. Trehan Independent 30-03-2015 19-05-2015 NA
4 Mr. Amit Gupta Non- Executive 12-09-2014 07.09.2015 NA

*Mr. Kaushik Sarkar continued as a Director upto June 24 2015 and thereafter continuesas a CFO.

HUMAN RESOURCES DEVELOPMENT

The Company is committed to build an environment and where employees are inspired toachieve excellence in their area of functioning. The Human Resource Policy of the Companyis focused on attracting building and retaining best talents. In this direction theCompany has taken several Human Resource initiatives and has strengthened the in-houseHuman Resource Department. Many continuous training and employee development programs areput in place. Company’s health policies commits to provide safe and healthy workenvironment to all the employees.

The manpower strength of the Company on consolidated basis stood at 1603 employeesduring the year end.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 (12) of the Companies Act 2013 readwith Rule 5(1) of The Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 is provided as Annexure III to this Report.

The statement of particulars of employees pursuant to Rule 5(2) of Companies(Appointment and Remuneration of

Managerial Personnel) Rules 2014 is attached as Annexure IV to this Report.

4. CORPORATE GOVERNANCE

The report on Corporate Governance as required under Schedule V of the SEBI (LODR)Regulations 2015 is attached and forms part of the Annual Report. A certificate from theAuditors of the company as regards of compliance of conditions of corporate governance isalso appended to the report.

MEETINGS OF THE BOARD

The Board of the Company met 7 (seven) times during the year. The dates attendance andother particulars of the meetings are furnished in the Report on Corporate Governanceattached to this Report. The intervening gap between any two meetings was within the limitprescribed by the provisions of Companies Act 2013.

COMMITTEES OF THE BOARD

The Audit Committee consists of 5 members namely Mr. Kailash M. Rustagi Mr. PradeepDadlani Mr. Srinath Batni and Dr. Vivek Mansingh Independent Directors and Mr. KedarnathChoudhury Non-executive Director. The Chairman of the Audit Committee is an IndependentDirector.

All the recommendations made by the Audit Committee during the year have been acceptedby the Board.

The Company has also constituted Nomination and Remuneration Committee StakeholdersRelationship Committee and Corporate Social Responsibility Committee as required under theprovisions of Companies Act 2013 and also as required under Listing Regulations and thecomposition scope of their functions responsibilities etc. are given in the CorporateGovernance Section which forms part of this Report.

DECLARATION FROM INDEPENDENT DIRECTORS

The Company has received declarations from all Independent Directors under Section149(7) of the Companies Act 2013 to the effect that they meet the criteria ofindependence as laid down in section 149(6) of the Companies Act 2013. The terms andconditions of appointment of Independent Directors are placed on the website of theCompany at www.axiscades.com.

PERFORMANCE EVALUATION OF THE BOARD COMMITTEES AND DIRECTORS

The board of directors has carried out an annual evaluation of its own performanceBoard Committees and individual directors pursuant to the provisions of the Companies Act2013 and SEBI (LODR) Regulations 2015.

The performance of the Board and its committees was evaluated by the Board / committeeafter seeking inputs from all the directors/members on the basis of the criteria andframework adopted by the Board. The evaluation process has been explained in the CorporateGovernance Report section of the Annual Report.

VIGIL MECHANISM

The Vigil Mechanism of the Company which also incorporates the Whistle blower policyprovides a formal mechanism to all Directors and employees to approach the Chairman of theAudit Committee and make protective disclosures about unethical behavior actual orsuspected fraud or violation of the Company’s Code of Conduct or ethics policy. TheWhistle Blower Policy is an extension of the Company Code of Conduct which requires everyemployee to promptly report to the Management any actual or possible violation of the Codeor an event he is aware of that could affect the business or reputation of the Company.The disclosures reported are addressed in the manner and within the time frames prescribedin the Policy. No personnel of the Company were denied access to the Chairman of the AuditCommittee. The Whistle blower policy which also describes the mechanism may be accessed onthe Company’s website at www.axiscades.com.

POLICY ON DIRECTOR’S APPOINTMENT AND REMUNERATION

The company’s policy on directors’ appointment and remuneration includingcriteria for determining qualifications positive attributes independence of a directorand the policy on remuneration of directors key managerial personnel and other employeesformulated pursuant Section 134(3) (e) and 178 (3) of the Companies Act 2013 arefurnished in Annexure V.

RISK MANAGEMENT POLICY

The Company has formulated and implemented a Risk Management Policy which focuses onidentification of elements of risk if any which in the opinion of the Board maythreaten the existence of the Company.

The Company has a risk identification and management frame work appropriate to its sizeand the environment under which it operates. The risk management process involvesidentification and periodic assessment of potential risks and their impact on theoperations profitability growth and continuity and focuses on risk elements relatedcompetitive position in the key market segments business environment statutory andregulatory changes global economy and business scenario Currency exchange ratefluctuations resource constraints etc. and initiating timely preventive as well asremedial actions.

Reporting and control mechanisms ensure timely information availability and facilitatesproactive risk management. These mechanisms are designed to cascade down to the level ofline managers so that risk at the transactional level are identified and steps are takentowards mitigation in a decentralized fashion. Risks are being continuously monitored inrelation to business strategy operations and transactions statutory/legal compliancefinancial reporting information technology system etc. on inputs from both external andinternal sources like key incidents Internal audit findings etc.

The Board of Directors is responsible for monitoring risk levels on various parametersand the senior management group ensures implementation of mitigation measures ifrequired. The audit committee provides the overall direction on the risk managementpolicies.

PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

In order to prevent sexual harassment of women at work place your Company has adopted aPolicy for prevention of Sexual Harassment of Women at Workplace and has proper mechanismto control the same which is commensurate with the nature and size of the business of thecompany. During the year 2015-16 no such complaints were received.

5. DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) read with Sec. 134 (3) (c) of the Companies Act 2013 yourDirectors confirm that: a. in the preparation of the annual accounts the applicableaccounting standards have been followed along with proper explanation relating to materialdepartures; b. they have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit or loss of the Company for that period; c. they have taken proper andsufficient care for the maintenance of adequate accounting records in accordance with theprovisions of the Act for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities; d. they have prepared the annual accounts on agoing concern basis; e. they have laid down internal financial controls to be followed bythe Company and that such internal financial controls are adequate and are operatingeffectively; and f. they have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems are adequate and operatingeffectively.

6. AUDITORS AND AUDITORS’ REPORT

STATUTORY AUDITORS

M/S Walker Chandiok & Co LLP Chartered Accountants (Firm Registration No. 001076N/N500013) were appointed as Auditors of the Company by the shareholders at the AGM held onSeptember 9 2014 (duly ratified in the AGM dated September 7 2015) to hold office untilthe conclusion of the 27th AGM of the Company to be held during the calendar year 2017. Interms of the first proviso to Section 139 of the Companies Act 2013 the appointment ofauditors shall be placed for ratification at every AGM. Accordingly the appointment of M/sWalker Chandiok & Co LLP Chartered Accountants as Auditors of the Company is placedfor ratification of the shareholders at the ensuing AGM. The Company has received acertificate from the auditors to the effect that their appointment will be in accordancewith the provisions of Section 141 of the Companies Act 2013.

The Auditors’ Report does not contain any qualification reservation or adverseremark.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s Anant B. Khamankar & Co. Company Secretaries to undertake SecretarialAudit of the Company for the financial year 2015-16. The Secretarial Audit Report attachedas Annexure VI forms part of this report. Secretarial Audit Report does not contain anyqualification reservation or adverse remark.

Details in respect of frauds reported by Auditors other than those which are reportableto the Central Government

The Statutory Auditors or the Secretarial Auditors of the Company have not reported anyfrauds to the Audit Committee or to the Board of Directors under section 143(12) of theCompanies Act 2013 including rules made thereunder.

SIGNIFICANT ORDERS BY REGULATORS/COURTS/TRIBUNALS

There are no significant and material orders passed by the regulators or courts whichwould impact the going concern status of the company and its future operations (other thanthe one mentioned above w.r.t. Scheme of Amalgamation).

EXTRACT OF ANNUAL RETURNS

The extract of Annual Return of your Company as on March 31 2016 prepared pursuant toSection 92(3) of the Companies Act 2013 and the Rules made thereunder in Form MGT-9 isattached as Annexure VII to this Report.

INTERNAL FINANCIAL CONTROLS

Your Company has adopted the policies and procedures for ensuring the orderly andefficient conduct of its business including adherence to the Company’s policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial disclosures. The same has been audited and certified by the StatutoryAuditors of the company in their Audit Report.

7. CORPORATE SOCIAL RESPONSIBILITY (CSR)

The company has constituted a Corporate Social Responsibility Committee (CSR Committee)in accordance with the provisions of Section 135 of the Companies Act 2013 and the rulesmade thereunder. The Committee is chaired by an Independent Director. The Company onrecommendation of the CSR Committee has framed a CSR policy in line with Schedule VII ofthe Companies Act 2013. The policy has been posted and is accessible on thecompany’s website at www.axiscades.com.

The annual report on CSR activities is furnished in RsAnnexure VIIIRs to this Report.

8. CONSERVATION OF ENERGY FOREIGN EXCHANGE EARNINGS ETC

The particulars pursuant to Rule 8(3) of Companies (Accounts) Rules 2014 are givenbelow

Conservation of Energy

Being an Information Technology company it is not energy intensive. However adequatemeasures have been taken to conserve energy by introducing improved operational methods.The company in its initiative to be ISO14001 – Environmental Management Systemcompliant is adhering to the provisions of E-Waste (Management and Handling) Rules 2011and Batteries (Management and Handling) Rules 2011 by efficiently managing the ACinstallations and recycling of paper etc.

Foreign Exchange Earnings and Outgo (Standalone)

Rs Million
2016 2015
Foreign Exchange Earnings (actual inflows) 1843.20 1430.68
Foreign Exchange Outgo (actual outflows) 823.16 654.25

Technology Absorption

The Company has not engaged any imported technology. Since the requirements of thetechnology business are changing constantly your Company has sought to focus on criticalin house technologies and processes which are likely to create value in the foreseeablefuture.

9. FUTURISTIC STATEMENTS

Certain statements made in this section or elsewhere in this report may be futuristicin nature. Such statements represent the intentions of the Management and the effortsbeing put in by them to realize certain goals. The success in realizing these goalsdepends on various factors both internal and external. Therefore the investors arerequested to make their own judgment by taking into account all relevant factors beforemaking any investment decision.

GREEN INITIATIVES

As in the previous years this year too we are publishing the Annual Report in theprint version only for the members who have not registered their email address with theCompany / Depository Participant. The Physical copies are sent in the permitted mode.Electronic copies of the Annual Report are sent to all the members whose email addressesare so registered.

ACKNOWLEDGEMENTS

Your Directors deeply appreciate and acknowledge the cooperation and support extendedby Clients Vendors Investors and Bankers various government agencies & regulatorybodies across the globe the Software Technology Park Noida Hyderabad & Bangaloreand other industry forums and agencies like NASSCOM and look forward to their continuedsupport in the future. Your Directors wish to place on record their appreciation of thevaluable contribution made by the employees of the Company at all levels.

For and on behalf of the Board of Directors
Sd/- Sd/-
Valmeekanathan S Kedarnath Choudhury
CEO & Director Director
Date: June 16 2016
Place: Bengaluru

ANNEXURES TO THE BOARD’S REPORT

ANNEXURE -I: Particulars of Contract / Arrangements with Related Parties

(Pursuant to Clause (h) of Sub-Section (3) of Section 134 of the Act and Rule 8(2) ofthe Companies (Accounts) Rules 2014 read with Sub-Section (1) of Section 188 of theCompanies Act 2013-AOC-2)

1. Details of contracts or arrangements or transactions not at arm’s lengthbasis:

S. No. Particulars Details
(a) Name(s) of the Related Party and nature of relationship NIL
(b) Nature of contracts / arrangements / transactions NIL
(c) Duration of the contracts / arrangements / transactions NIL
(d) Salient terms of the contracts or arrangements or transactions including the value if any. NIL
(e) Justification for entering into such contracts or arrangements or transactions. NIL
(f) Date(s) of approval by the Board NIL
(g) Amount paid as advances if any NIL
(h) Date on which the special resolution was passed in General Meeting as required under first provision to Section 188 NIL

2. Details of contracts or arrangements or transactions at arm’s lengthbasis:

Sl. No. Particulars Details
(a) Name (s) of the related party Axis Inc. AXISCADES UK Ltd. AXISCADES Technology Canada Inc. AXISCADES Aerospace & Technologies Private Limited Jupiter Capital Pvt. Ltd.
Nature of relationship Subsidiary Stepdown Subsidiary Subsidiary Fellow subsidiary Holding Co.
(b) Nature of contracts/arrangements/ transaction Buy & Sale of service / Cross charge transactions Sale of service reimbursement / payment of expenses/ Cross charge transactions Sale of service reimbursement / payment of expenses/ Cross charge transactions Cross charge transactions/ Inter-Corporate Deposits Cross charge transactions
(c) Duration of the contracts/arrangements/ transaction 1. 36 Months from 1st Apr 2013 in respect of sale of services 2. Other transactions on ongoing basis 1. 36 Months from 1st Apr 2013 in respect of sale of services 2. Other transactions on ongoing basis 1. 36 Months from 1st Apr 2013 in respect of sale of services 2. Other transactions on ongoing basis Transactions on ongoing basis/ 24 months contract Transactions on ongoing basis

 

Sl. No. Particulars Details
(d) Salient terms of the contracts or arrangements or transaction including the value if any Invoices to be raised each month within 10 business days from the end of each month payable within Invoices to be raised each month within 10 business days from the end of each month payable within Invoices to be raised each month within 10 business days from the end of each month payable within Interest 14% pa Tenure 2 years
Value of transactions during the year. (Rs) 60 days. 60 days 60 days
1. Sale of services 115689222 26178799 165557736 - -
2. Expenses incurred on behalf of 5310595 1003692 3330787 - -
3. Expenses recovered from 4046997 345214 10007299 - -
4. Travel Expense Reimbursed - - - 2483135 -
5. Software subscription charges incurred by 13886610 - - - -
6. Salaries wages and bonus incurred on behalf of - - 5655488 - -
7. Salaries wages and bonus recovered / staff welfare expense incurred by 15706378 4519282 - - -
8. Capex Reimbursed - - - - 113178
9. Inter Corporate Deposit (ICD) extended - - - 137500000 -
10. Interest income - - - 3220959 -
(e) Date of approval by the Board/Audit Committee (in respect of contract of sale of services) The transactions were in the ordinary course of business and on arm’s length basis. All the sale transactions are approved by the Audit Committee. ICD transaction is approved by the Audit Committee and Board
(f) Amount paid as advances if any NIL NIL NIL NIL

 

For and on behalf of the Board
Sd/- Sd/-
Valmeekanathan S. Kedarnath Choudhury
CEO & Director Director
Date: June 16 2016
Place: Bengaluru

ANNEXURE -II: Statement containing salient features of the financial statement ofsubsidiaries/associate companies/joint ventures.

(Pursuant to first proviso Sub Section (3) of Section 129 of the Companies Act 2013read with Rule 5 of the Companies (Accounts) Rules 2014 - AOC -1)

Name of the Subsidiary
Particulars Axis Inc. (USA) AXISCADES UK Ltd. (UK) Axis Mechanical Engineering Design (Wuxi) Co. Ltd. (China) AXISCADES Technology Canada Inc. (Canada) Cades Studec Technologies India Private Limited (India)
Rs. Rs. Rs. Rs. Rs.
1 Financial period ended 31-Mar-16 31-Mar-16 31-Mar-16 31-Mar-16 31-Mar-16
2 Reporting currency and Exchange rate
2.1 Reporting Currency USD GBP RMB CAD INR
2.2 Exchange rate as on the last date of the relevant Financial year in the case of foreign subsidiaries 66.3329 95.0882 10.2641 51.0991 NA
3 Share capital 149065084 54720977 4623722 5110 6250000
4 Reserves & surplus 43699120 2721519 (5707321) 140412768 100984432
5 Total assets 296991492 106220935 1177228 211323936 124186987
6 Total Liabilities 296991492 106220935 1177228 211323936 124186987
7 Investments 76218558 - - - -
8 Turnover 934176731 253500115 - 372267667 161731087
9 Profit before taxation (23767822) (10178118) (372607) 63542777 24795493
10 Provision for taxation - (1347590) - 18597371 7820453
11 Profit after taxation (23767822) (8830528) (372607) 44945406 16975040
12 Proposed Dividend - - - - -
13 % of shareholding 100% 100% Subsidiary of Axis Inc. 100% 100% 76%

The Company does not have any associate or Joint Venture company.

Subsidiary’s performance and financial position:

1. Axis Inc: The revenue grew by 8.60 % as compared to last year due to increasedcustomer engagement however the losses were due to increased sales and marketingexpenses.

2. AXISCADES UK Ltd: The revenue was almost flat with a marginal decrease by 1.04% dueto local market condition. The losses were due to increased sales and marketing expenses.

3. AXISCADES Technology Canada Inc: The revenue grew by 18.75% as compared to previousyear due to growth in customer engagement. The profit came down by 17.16 % in the sameperiod due to pricing pressure.

4. Cades Studec: The Revenue Profit before and after tax has shown positive growth onY-O-Y basis.

5. Axis China: The Company is yet to commence its operations.

6. No subsidiary has been liquidated or sold during the year.

For and on behalf of the Board
Sd/- Sd/- Sd/- Sd/-
Valmeekanathan S. Kedarnath Choudhury Kaushik Sarkar Shweta Agrawal
CEO & Director Director CFO Company Secretary
Date: June 16 2016
Place: Bengaluru

Annexure- III: Details under section 197(12) of the Companies Act 2013 readwith Rules 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014

Rate Particulars
(i) The ratio of remuneration of each Director to the median remuneration of the a. Sudhakar Gande 41.12
employees of the Company for the financial year b. Valmeekanathan S. 22.30
c. Kaushik Sarkar* 14.49
(ii) The percentage increase in remuneration of each Director Chief Financial a. Sudhakar Gande Not Applicable
Officer Chief Executive Officer Company Secretary in the Financial Year b. Valmeekanathan S. 15.5%
c. Kaushik Sarkar 20.4%
d. Shweta Agrawal 28.0%

 

(iii) The percentage increase in the median remuneration of employees 15.1%
in the financial year.
(iv) The number of permanent employees on the rolls of the company 1105
(v) The explanation on the relationship between average increase in remuneration and company performance. The average increase is based on industry comparatives business growth and geared to attract motivate and retain the highly skilled employees who are the key drivers of our success and helps the Company to retain its industry competitiveness. The increases are also designed to reflect the performance of the individual the team and the Company.

 

(vi) Comparison of the remuneration of the Key Managerial Personnel against the performance of the Company (on standalone basis) a. % Increase in Revenue from Operations in 2015 -16 as compared to 2014 -15 24.72%
b. % Increase in PAT in 2015 -16 as compared to 2014 -15 132.07%
c. % Increase in EBIDTA in 2015 -16 as compared to 2014 -15 67.74%
For comparison purpose the percentage increase in remuneration of KMP is given in Rule no. (ii) above.

 

(vii) Variations in the market capitalization of the Company price earnings ratio as at the closing date of the current financial year and previous financial year and percentage increase over decrease in the market quotations of the shares of the company in comparison to the rate at which the company came out with the last public offer. Financial Year ended Closing share Price (BSE) Market capitalization (Rs Crores) Price Earning Ratio
31.03.2015 337.40 917.37 75.17
31.03.2016 286.50 778.98 25.99
Closing share price as on 31 March 2016 was Rs 286.50. The Company’s offer price during its public issue in 2001 was Rs 81.

 

(viii) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration. 9.35% (excluding managerial personnel)
8.91% (including managerial personnel) This is based on Remuneration Policy of the Company that rewards people based on their contribution to the success of the company and to ensure that the salaries are competitive to the peers in each geography that we operate in.

 

(ix)Company. against the performance of Managerial Personnel remuneration of the Key Comparison of the each Name of the KMP % increase in Remuneration in 2015-2016 % increase in Net Sales in 2015-2016 as compared to 2014- 2015 % increase in PAT 2015-16 as compare to 2014-2015 % Increase in EBIDTA in 2015-16 as compared to 2014-2015
. Shweta Agrawal Not Applicable
Kaushik Sarkar 15.5% 24.72% 132.07% 67.74%
Valmeekanathan S 20.4%
Sudhakar Gande 28.0%

 

(x) The Key Parameters for any variable component of remuneration availed by the Directors The key parameters are
a) Increase in consolidated revenue in USD & INR terms
b) Improvement in EBIDTA
c) Improvement in operating matrices

 

(xi) The ratio of the remuneration of the highest paid Directors to that of the employees who are not Directors but receive remuneration in excess of the highest paid Director during the year. NIL
(xii) It is hereby affirmed that the remuneration is as per the Remuneration Policy of the Company.

*Mr. Kaushik Sarkar continued as a Director upto June 24 2015 and thereafter continuesas a CFO. Note: Remuneration excludes the value of perquisites.

For and on behalf of the Board
Sd/- Sd/-
Valmeekanathan S. Kedarnath Choudhury
CEO & Director Director
Date: June 16 2016
Place: Bengaluru

ANNEXURE -IV: Statement showing the details of Employees of the Company as per Rule5(2) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014:

Employed throughout the financial year with an aggregate of Rs 60 lacs and above

Name of the Employee Designation of the Employee Remuneration received during the year Qualification Experience in years Date of commencement of employment Age Last employment held by the employee
Valmeekanathan S. CEO & Director 11880000 BE (Hons) in Mechanical Engineering 31 25-02-2014 52 Independent Consulting (Consultant)
Kaushik Sarkar Chief Financial Officer 7607638 Master of Commerce FCA and ACMA 21 12-09-2014 46 Independent Consulting (Consultant)
A Visweswara Rao VP & Head - HR 7038645 MBA 21 16-04-2012 47 BT India Pvt Ltd (Head - HR)
Abhay Sharma VP-Sales 10316883 BE 22 24-09-2012 43 Satyam Computer Services Limited (Program & Relationship Manager)
Oliver Brotzki General Manager 7933955 Graduated mechanical engineer 19 20-01-2012 47 3D Contech (Branch Manager)
Marc Bouzaid Head of BU Engineering Services 10583117 B.Tech 11 08-03-2013 33 Teccon Design and Engineering (Manager)
Juergen Kaehm Kai Fanslau-Ahnfeld Lead Engineer 6043640 BE 35 01-12-2013 57 3D contech Designer
Sales Manager 6029656 Diploma of automotive Engineering 8 01-04-2012 37 3D contech Stress Leader
Employed for part of the year with an average salary of 5 lac per month and above.
Sudhakar Gande Vice Chairman & Executive Director 10612903 M.Tech in Electronics & Computers MBA (Finance) 27 14-08-2015 58 AXISCADES Aerospace Technologies Pvt. Ltd. (Vice Chairman & ED)
Sriram Jayakrishna VP-Delivery 6298548 BE 22 09-04-2015 43 Tata Technologies Ltd. (Aero Engineering & Design-Program Management)

Notes:

1. Nature of employment: All the above are in regular employment of the Company.

2. Remuneration includes company’s contribution to P.F. variable pay and excludesthe value of perquisites.

3. None of the above (together with their spouse and dependent children) holds 2% ormore of the equity shares of the Company.

4. None of the above employees is related to a Director.

For and on behalf of the Board
Sd/- Sd/-
Valmeekanathan S. Kedarnath Choudhury
CEO & Director Director
Date: June 16 2016
Place: Bengaluru

ANNEXURE -V

NOMINATION AND REMUNERATION POLICY

Introduction:

The Company is a Service Industry and therefore Company’s policy strives toconsider human resources as its invaluable assets to pay equitable remuneration to allDirectors Key Managerial Personnel (KMP) and employees of the Company.

In terms of the provisions of the Companies Act 2013 and the listing agreement asamended from time to time the Nomination and Remuneration Committee has formulated thispolicy on nomination and remuneration of Directors Key Managerial Personnel and SeniorManagement (if any) and the same is approved by the Board of Directors.

Objective:

• To lay down criteria with regard to identifying persons who are qualified tobecome Directors (Executive Non-Executive and Independent) and persons who may beappointed in Senior Management and Key Managerial positions.

• Formulating Policy for remuneration for the Directors / KMPs and SMPs

• To carry out evaluation of the performance of Directors as well as KeyManagerial and Senior Management Personnel.

• Recommending appointment and removal of Directors KMPs and SMPs

In order to achieve the aforesaid objectives the following policy has been formulatedby the Nomination and Remuneration Committee and adopted by the Board of Directors at itsmeeting held on 23rd June 2014. The revised policy was adopted on 9th September 2014.

Effective Date:

This policy shall be effective from 1st April 2014.

Constitution of the Nomination and Remuneration Committee:

The Board has renamed its Remuneration Committee as Nomination and RemunerationCommittee on 27th March 2014 and reconstituted it on 9th September 2014. The Nominationand Remuneration Committee comprises of following Directors:

• Mr. Srinath Batni (Independent Director)
• Mr. Pradeep Dadlani (Independent Director)
• Mr. Kedarnath Choudhury (Non Executive Director)
• Mr. Amit Gupta (Non Executive Director)
• Ms. Shweta Agrawal (Secretary)

The Board has the power to reconstitute the Committee consistent with the applicablestatutory requirements.

Applicability:

The Policy is applicable to

• Directors (Executive and Non Executive)

• Key Managerial Personnel

• Senior Management Personnel (if any)

General

• This Policy is divided in three parts: Part A covers the matters to be dealtwith and recommended by the Committee to the Board Part – B covers the appointmentand nomination and remuneration PART – C covers proceedings of the Committeemeetings.

• The key features of this Company’s policy shall be included in theBoard’s Report.

PART – A

MATTERS TO BE DEALT WITH AND RECOMMENDED TO THE BOARD BY THE NOMINATION ANDREMUNERATION COMMITTEE

The Committee shall:

• Formulate the criteria for determining qualifications positive attributes andindependence of a director.

• Identify persons who are qualified to become Director and persons who may beappointed in Key Managerial and Senior Management positions in accordance with thecriteria laid down.

• Recommend to the Board appointment of Director KMP and Senior ManagementPersonnel.

• Performance Evaluation of each Director KMP and Senior Management Personnel forthe purpose of appraisal or removal/ replacement.

• Policy for Remuneration for Director KMP and Senior Management Personnel.

• Monitor the Board Diversity and balanced Board

Succession planning- recommends to the Board from time to time on longterm succession plan and also contingency plan in case of exigencies relating to bothBoard as well as Executive management.

Retirement policy- The retirement age of the directors is fixed by theBoard of Directors in consultation with the Nomination and Remuneration Committee.

PART – B

POLICY FOR APPOINTMENT AND REMOVAL & REMUNERATION OF DIRECTOR KMP AND SENIORMANAGEMENT

Appointment criteria and qualifications:

1. The Committee shall identify and ascertain the qualification expertise attributesand experience of the person for appointment as Director KMP or at Senior Managementlevel and recommend to the Board his / her appointment.

2. For Recommending any person as Executive Director the Committee shall take intoconsideration the provisions of the Companies Act 2013 read together with the Rulesprescribed there under and Schedule V.

3. For recommending any person as Non-Executive Director/ Independent Director theCommittee shall take into consideration the provisions of the Companies Act 2013 readtogether with the Rules prescribed there under and Schedule IV along with the criteria forindependence defined under Listing Agreement.

• The Committee shall carry out evaluation of performance of every Director KMPand Senior Management Personnel at regular interval (yearly).

• Due to reasons for any disqualification mentioned in the Companies Act 2013rules made there under or under any other applicable Act rules and regulations or on thebasis of performance evaluation the Committee may recommend to the Board with reasonsrecorded in writing removal / replacement of a Director KMP or Senior ManagementPersonnel subject to the provisions and compliance of the said Act rules and regulations.

• The Non-Executive / Independent Director may receive remuneration by way of feesfor attending meetings of Board or Committee thereof. Provided that the amount of suchfees shall not exceed Rs One lakh per meeting of the Board or Committee or such amount asmay be prescribed by the Central Government from time to time.

• An Independent Director shall not be entitled to any stock option of theCompany.

PART – C

COMMITTEE PROCEEDINGS

• The Chairman of the Committee will report to the Board (at the next Boardmeeting) on the proceedings of each Committee meeting bringing forward all Committeerecommendations requiring Board approval.

• The Secretary will:

(a) in conjunction with the Chairman of the Committee settle agendas for and arrangemeetings of the Committee so as to ensure timely coverage of all the Committee’sbusiness;

(b) distribute agendas and supporting papers to Committee members sufficiently far inadvance of scheduled meetings to permit adequate preparation;

(c) keep and distribute minutes of each meeting to Committee members; and

(d) circulate copies of the minutes to the remaining Board members upon request.

The quorum for a meeting of the Committee will be a majority of the members and includeat least one Independent Director.

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