|BSE: 512341||Sector: IT|
|NSE: N.A.||ISIN Code: INE396F01013|
|BSE 05:30 | 01 Jan||CES Ltd|
|NSE 05:30 | 01 Jan||CES Ltd|
|BSE: 512341||Sector: IT|
|NSE: N.A.||ISIN Code: INE396F01013|
|BSE 05:30 | 01 Jan||CES Ltd|
|NSE 05:30 | 01 Jan||CES Ltd|
The Members of M/s. CES LIMITED
The Directors have pleasure in presenting the 32nd Annual Report of theCompany together with the Audited Accounts for the year ended on 31st March2017 (01.04.2016 to 31.03.2017).
BUSINESS PERFORMANCE OF THE COMPANY
Standalone: Our revenue for financial year 2016-17 is Rs. 671.07 Million and ourprofit after tax (PAT) Rs. 98.74 Million.
Consolidated: Our consolidated financial results for financial year 2016-17 isRs.2258.96 Million and our consolidated profit after tax (PAT) is Rs. 146.49 Million.
COMMITTEES OF THE BOARD
NOMINATION & REMUNERATION COMMITTEE
STAKEHOLDER RELATIONSHIP COMMITTEE
CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
DURING THE FINANCIAL YEAR 2016-2017 SEVEN BOARD MEETINGS WERE HELD AS FOLLOWS:
06.04.2016 30.05.2016 13.08.2016 06.09.2016 14.11.2016 14.02.2017 30.03.2017.
FINANCIALS OF SUBSIDIARY COMPANY
Pursuant section 129 sub section (3) the financials of subsidiary are as per Annexure-I
EXTRACT OF ANNUAL RETURN
Pursuant to section 134 sub section (3) (a) the extract of annual return enclosed in Annexure-II DIRECTORS' RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statements in terms ofSection 134 of the Companies Act 2013:
(a) That in the preparation of the annual accounts/financial statements for thefinancial year ended 31st March 2017 the applicable accounting standards hadbeen followed along with proper explanation relating to material departures if any;
(b) That the accounting policies as mentioned in the financial statements wereselected and applied consistently and reasonable and prudent judgments and estimates weremade so as to give a true and fair view of the state of affairs of the company at the endof the financial year and of the profit and loss of the company for that period
(c) That proper and sufficient care had been taken for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the company and for preventing and detecting fraud andother irregularities;
(d) That the annual accounts were prepared on a going concern basis;
(e) That proper internal financial controls were in place and that such internalfinancial controls are adequate and were operating effectively; and
(f) That proper systems to ensure compliance with the provisions of allapplicable laws were in place and that such systems were adequate and operatingeffectively
STATEMENT OF DECLARATION BY INDEPENDENT DIRECTORS -149(6)
The Company has received Certificate of Independence from Independent Director inter-aliapursuant to Section 149 of the Companies Act 2013 confirming and certifying that theyhave complied with all the requirements of being an Independent Director of the Company.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENT (SECTION 186)
During the financial year no such instance.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES (188(1))
The Company had entered into any contract/ arrangement with it whole own U S aSubsidiary i.e. CES USA Inc. The Board of Directors and Shareholders of the Company hasapproved the contract up to 30th December2019.
EXPANSION OF BUSINESS SPACE GACHIBOWLI HYDERABAD:
The company has purchased property of 26358 square feet at Fourth Floor Ramkyselenium Nanakramguda Gachibowli Hyderabad 08 from JMKGEC Realtors Private Limited andSDNMKJ Realty Private Limited. This property is located in the financial districtHyderabad.
The Company had furnished Fourth Floor with high quality of Infrastructure and startedits business operations in month of June 2017. The Seating capacity is for 350 Employees.
AMOUNT IF ANY IF IT PROPOSES TO CARRY TO RESERVES:
During the end of the financial year the Company has not transferred any amount toreserves.
NO DIVIDENDS DECLARED FOR FINANCIAL YEAR 2016-17:
The Company is at expansion mode; therefore Board is of Opinion that there is no needto declare dividends.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 13 (3) (m) of the Companies Act 2013 readwith Rule 8 of the Companies (Accounts) Rules 2014 to this report.
(a) Conservation of Energy:
This year we devoted considerable attention on methods and approaches to conservepower. Significant steps taken in this regard include the following:-
Turning off monitors during weekends.
Hibernation of Desktops & notebook computers when not in use.
Turning off lights in all floors when not working.
Turning off the Air Conditioners during non-peak hours and on weekends.
(b) (i) Technology Absorption adaptation and innovation:-
As you would appreciate technology is witnessing rapid change. Since our customersexpect us to lead them through such change we proactively & continuously invest indeveloping technology building blocks and solution frameworks which add value to ourcustomers' business. Company uses a multi-pronged strategy for developing technologyassets and to promote innovation. These technology initiatives are driven by each businessunit based on the trends they see in their respective markets. These efforts help us intwo ways (i) gain our customers' trust & confidence; and (ii) attract & retain keytalent who see the Company as a more exciting place to work in.
(ii) Research and Development(R &D):
Your company carries out various research and development initiatives to addressdifferent market segment.
(c) Foreign Exchange earnings and outgo:
Statutory / Financial Audit
The provisions of Section 139(2) of the Companies Act 2013 and the Rules madethere-under mandated the Company to rotate its existing Statutory Auditors. The term ofthe existing Auditors M/s. P Murali & C. expires for the FY 2016-17 i.e till theconclusion of ensuing Annual General meeting to be held on 29th September 2017.
In this regard Board of Directors of the Company (on recommendation of AuditCommittee) in its meeting held on 29th August 2017 has subject to approval ofshareholders in the ensuing Annual General meeting to be held on 29th September2017 approved the appointment of M/s. Chandra Babu Naidu & Co. (FRN: 016016S)Chartered Accountants as the Statutory Auditors of the Company for a period of Five Yearsw.e.f from the Conclusion of this Annual General Meeting subject to ratification at everyAnnual General Meeting.
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 Mr.Sharda Putcha Company Secretaries in Practice (C.P No.8735 ) to undertake theSecretarial Audit of the Company. The Report of the Secretarial Audit Report is annexedherewith as Annexure- III.
Pursuant to provisions of section of 138 of Companies Act 2013 and Companies (Accounts)Rules 2014 Board of Directors appointed Ram Mohan & Associates. (Regn No.007700S) asInternal Auditors of the Company
RELATED PARTY DISCLOSURE
Loans and Advances Made By Parent Company to Subsidiary Company
The Company has Given Rs. 10273844/-Loan to its Subsidiary Company I.e CESinformationTechnology Private Limited.
DISPUTES IF ANY
The Company has initiated arbitration action against Mr. Ramulu Kambalapuram forsolicitation of clients employees and breach of trust and duty in one of the SubsidiaryCompanies CES Technology Services Private Limited pursuant to the Share PurchaseAgreement read with Shareholders Agreement. Earlier Mrs. Mamatha Mandadi has initiatedarbitration against the Company for an alleged failure by the Company of itsresponsibilities under the above Agreements. Now the claims of the Company against bothMr. Ramulu and Mrs. Mamatha will be adjudicated together through arbitration.
THE MANAGEMENT DISCUSSION AND ANALYSIS REPORT
(a) INDIAN ITES (BPM) INDUSTRY DEVELOPMENTS AND OUTLOOK
Indian IT/ITES - Business Process Management (BPM) industry is estimated to grow at arate of 8% in FY2017 growing from USD 143 Billion in FY 2016 to USD 154 Billion in FY2017. The Indian IT-BPM industry is feeling the impact of the global slowdown and globalpolitical uncertainties as clients go slow on their decision making and investmentprocesses. Exports are likely to record a 7.6% growth to reach over USD 117 Billion up byUSD 9 Billion over last year. Domestic IT BPM market is at USD 38 Billion and grew by alittle over 8%.
The BPM Sector in India has grown over 1.6 times in the last 5 years and is expected totouch revenues of USD 30 Billion increase of 2 Billion over previous year. BPM industryshare in total IT /ITES (BPM) Industry is increasing and for the year the share was at19%. Exports contribute 87% of total BPM while the remaining 13% is from domestic BPM.
BPM exports are driven by Business Process as-a- Service (BPaaS) mobility and advancedanalytics. Retail healthcare utilities will generate significant opportunities for thissector. It grew by 7.5% in FY 2017 to touch USD 26.3 Billion as compared to USD 24.2Billion in the previous year.
Domestic BPM segment is largely driven by BFSI telecom and Ecommerce; alsoGovernments Digital India initiatives is a key growth factor and development of BPMinfrastructure will directly impact growth of this segment. Domestic BPM industry islikely to grow over 5% to USD 3.8 Billion.
By 2020 as per NAASCOM Indias IT/ITES (BPM) industry total revenue is projectedto touch USD 200 225 Billion and between USD 350 440 Billion by 2025. Digital technologieswill continue to grow at a faster pace and revenues from this will have a share of 23% in2020 and greater than 38% in 2025. Lots of opportunity for the Indian service providers inthis digital space as digital technologies continues to be embedded in an ever wideningrange of products and services.
The dynamics of Indian ITES (BPM) industry has shifted from a cost based to a valuebased proposition with benefits accruing to the Client is paramount consideration thancost reduction. Indian BPM service providers have to reach out to new cadre of Customersplace more focus on customer satisfaction and migrate processes to business processas-a-service (BPaaS) and use analytics as an integral part of their services. The futureoutlook for Indian BPM industry points towards new business model and expansion to newgeographies verticals and markets.
As per NASSCOM the business fundamentals in the ITES (BPM) segment are robust and theindustry is poised to grow to a revenue of USD 54 billion by 2025.
The constant focus on process improvement by automation and continuous benchmarking ofdelivery to improve focus have resulted in customer satisfaction every time. Ourcustomers stand testimony to our track record of providing outstanding customer experienceand maximizing their Return on Investment. Building Lasting Relationships hasalways been our culture and that focus enables us to deliver enhanced business value aculture that inspires our actions and is a part of our DNA.
We also aim to offer our services in the domestic market by positioning our services tosuit the domestic business with its unique Services.
CES Limited is in an industry where attrition is one of the major concern areas .TheCompany in the international business faces tough challenges in getting employablemanpower from the available manpower pool. CES Limited has been investing a lot ofresources for training candidates on the basic skills that are required to make thememployable. The attrition rate in the Domestic business is also on similar lines. CES hasextended its learning in the International segment to Domestic market and necessaryprocesses are in place to ensure that right candidates are being hired trained andretained.
(b) Segment wise.
SEGMENT WISE RESULTS (STANDALONE): BUSINESS SEGMENT:
(Rs. In Lacs)
SEGMENT WISE RESULTS (CONSOLIDATED):
(Rs. In Lacs)
(c) Risks and concerns.
The International business is affected by the global slowdown and we are activelyincreasing the marketing activity both by increasing the sales force as well as increasethe marketing team and by doing more targeted marketing. The offshore servicing businesswhich yields exports revenue has not grown and it continues to have a lower CapacityUtilization. We have teams in US as well as consultants will keep putting efforts to growthis business.
The Domestic business is improving gradually and pricing in the market has beenincreasing gradually. We now have good capacity utilization in this business at rateswhich are much higher than what we were getting a few years back. The plan is to keeplooking for strategic contracts where we can negotiate higher rates and make this businessmore profitable.
INDIAN COMPLIANCE AND TAXATION RISK
Taxes and other levies imposed by the Government of India. In particular we will beaffected by the taxes and laws levied by authorities such as a) Income Tax b) Service Taxetc. We are taking adequate efforts to comply with the entire statutory requirement on anongoing basis and the same is subject to Internal Audit on a quarterly basis. We also takethe help of external consultants to handle specific issues as and when it arises.
The Central Government has proposed to introduce the new Goods and Services Tax (GST)during the financial year 2017-18. Our Company has taken necessary steps to ensure smoothtransition to GST regime.
Movements in exchange rates continue to be a threat. There has been volatility in theexchange rate between INR and USD in the recent years and these currencies may continue tofluctuate significantly in future as well. While the rupee was range bound between INR66-INR 68 against the USD for most part of the year there was a sudden movement of therupee towards the last fortnight of the financial year where in the rupee appreciatedabove INR 65. We are currently adopting hedging strategies as approved by the Board and inaddition use bank balances in foreign currency to meet our foreign currency liabilities.Also the increase in share of domestic revenue will mitigate this risk to an extent. Ourresults of operation will be affected if the rupee- dollar rates continues to behave in avolatile manner in future or rupee appreciates significantly against dollar and othercurrencies. Our consolidated results are affected by translation as revenues bysubsidiaries are mainly in USD.
GEOGRAPHICAL CONCENTRATION OF CLIENTS
Our Company has a global footprint and the revenues are dependent on clients locatedpredominantly in US. As a strategy we continue to focus on increasing the share of ourRevenues from US as the margins are better compared to Domestic business. As a result theCompany is exposed to various risks typically associated with doing business in variouscountries many of which are beyond the control of the management.
The Company has invested substantially in the state of the art infrastructure andequipment in its centres to provide a world-class service to its customers. Service to ourclients also depends on the uninterrupted functioning of these equipment power andstability of telecom network. Any obsolescence in the infrastructure and equipment leadingto incompatibility with clients systems or any disruption in the essential servicesmay affect the business of the company. Adequate backups and redundancy measures are inplace for uninterrupted functioning of IT and telecom equipment. AMC of allequipment is being monitored for timely renewals wherever needed. Insurance for fixedassets and all office locations is in force and is monitored for timely renewals andadequacy of risks covered under Office package policy.
HUMAN RESOURCES RISK
ITES (BPM) industry is a labour intensive industry and the Companys successdepends on its ability to retain key employees. Historically employee attrition has been acommon feature in this Industry and but our Company has a low level of attrition compareto industry . There have been cases of companies losing KPO orders for not being able todemonstrate a competent team that can manage a large workforce. Increasing level ofattrition further complicates the problem.
There is a gap between the supply and demand of work force. Further the available manpower is not immediately employable in terms of the skill sets required for the industry.Thus the shortage of supply in quality manpower both at the managerial level and at theagents level may significantly affect the functioning of the Company.
(d) Internal control systems and their adequacy:
CES Limited (CES) has adequate internal controls and checks in place for all itsoperations across locations. The internal control systems are robustly designed keepingfuture requirements and needs. The management systems being followed at CES comply withinternational standards and are audited by the independent certification body "TVRhineland (India) Pvt. Ltd".
Compliance and Certification Achievements in Year 2017: 2018
ISO 9001: 2015 International Standard for Quality Management System (QMS)
ISO 27001: 2013 International Standard for Information Security Management System(ISMS)
CMMI- SVC Maturity Level 3 : Service Management Process System
Payment Card Industry Data Security Standard (PCIDSS): V3.2 - Compliance for Order andPayment processing and Customer support services
Our Corporate Quality team is well trained on all International Standards &Industry Specific Compliance Requirements and have good competency in performing auditsefficiently and effectively.
With focus on Customer Delight and Delivery Assurance all our operational locationsare audited in early this year to ensure that the infrastructure and processes adhere tosafety security reliability and availability of data for all its customers andinterested parties.
Having esteemed customers added to its business CES has started the journey towardsachieving CMMI Maturity Level 5: a highest standard for attaining Capability andMaturity for Service Delivery and ISO 22301: International Standard for BusinessContinuity Management. The projects are already kicked-off and are slated to becompleted by end of 2017 or early 2018
(e) Material developments in Human Resources
At CES human capital has always been the most valuable asset of the Company. Ouremployees represent the backbone of the corporate success. The Company provides itsemployees a transparent and level playing work environment that fosters the culture ofcollaborative working meritocracy and on-the-job career progression.
The Company believes in fair employment practices and is committed to provide anenvironment that ensures that every employee is treated with dignity and respect andafforded equitable treatment. The Company has zero tolerance for sexual harassment at itsworkplaces and has adopted a Policy on Prevention Prohibition and Redressal of SexualHarassment at the Workplace in line with the provisions of the Sexual Harassment of Womenat Workplace (Prevention Prohibition and Redressal) Act 2013 and the Rules there under.The Company has not received during the year any concerns including sexual harassmentcomplaints.
Activities at CES Limited
The Company conducts various activities at CES Limited from time to time in thefinancial year 2016-17. Company has Conducted Sapling Trees in Government School.
The Company provides harassment free atmosphere to its emnployees Specially Womenemployee of the Company and so a work shop on " Harassment of Employees at work Placeconducted by
Mangement making all the women employees aware about the Policy.
CORPORATE GOVERNANCE REPORT: THE FOLLOWING DISCLOSURES SHALL BE MADE IN THE SECTION ONTHE CORPORATE GOVERNANCE OF THE ANNUAL REPORT.
(1) A BRIEF STATEMENT ON LISTED ENTITYS PHILOSOPHY ON CODE OF GOVERNANCE.
The Companys philosophy on Corporate Governance envisages attainment of thehighest levels of transparency accountability and equity in all facets of its operationsand in all its transactions with its stakeholders including its employees customersshareholders suppliers partners and alliances supporting agencies Government andsociety at large.
The Management aims to achieve its objective of increasing stakeholders valuewhile consistently observing the norms laid down in the Code of Corporate Governance. TheManagement has institutionalized Corporate Governance at all levels within the Company inorder to ensure transparency good practices and a systems-driven style of functioning. Ithas also established the WE CARE framework for honoring commitments to and ensuring apositive experience by our key stakeholders.
The overall responsibility for guiding Corporate Governance within the Company restswith the
Board of Directors (the Board) which has put in place appropriatepolicies guidelines and processes. The day-to-day implementation and monitoring of thesepolicies guidelines and processes rest with the management of the Company and are inconsonance with the requirements of the Companies Act 2013 and applicable SEBIRegulations including SEBI (LODR). Keeping in view the Companys size complexityglobal operations and corporate traditions
CES Limited has adopted the following main principles and philosophies:
Constitution of the Board of the Company and Committees of Directors of appropriatecomposition Size and expertise.
Complete transparency in the operations of the Company.
Maintaining prescribed levels of disclosure and complete openness in communication.
Independent verification and safeguarding integrity of the Companys financialreporting.
A sound system of risk management and internal control.
Timely and balanced disclosure of all material information concerning the Company toits stakeholders.
A system to ensure compliance with applicable laws of all countries in which theCompany operates.
Maintenance of high standards of safety and health.
Adherence to good governance practices in spirit and not just in letter
(2) BOARD OF DIRECTORS:
(a) Composition and category of Directors
(b) Director and Directors Attendance at Board Meeting and AGM
*Mr.Appa Kancharla who is Alternate Director for Mr. Ram Kancharla has resigned w.efrom 04.06.2017.
Disclosure of relationships between directors inter-se;
1. Shri Appa Rao Kancherla is Father of Shri Mohana Rao Kancharla.
2. Shri Appa Rao Kancharla is Father of Shri Ram Kancharla.
3. Shri Mohana Rao Kancharla and Shri Ram Kancharla are Brothers.
(3) AUDIT COMMITTEE:
Terms of reference:
The terms of reference of Audit Committee encompass the requirements of Section 177 ofCompanies Act 2013 and Regulation 18 of SEBI LODR (Regulations) 2015.
The terms of reference inter-alia includes:
Oversee the companys financial reporting process and the disclosure of itsfinancial information to ensure that the financial statement is correct sufficient andcredible.
Recommending to the Board the appointment and removal of external auditor and fixationof audit fees and also approval of payment for any other services.
Reviewing with the management the annual financial statements before submission tothe Board focusing primarily on:
Any changes in accounting policies and practices.
Major accounting entries involving estimates based on the exercise of judgment bymanagement.
Significant adjustments arising out of audit.
The going concern assumption.
Compliance with accounting standards.
Compliance with stock exchange and other legal requirements relating to financialstatements.
Reviewing with the management the quarterly financial statements before submission tothe board for approval.
Reviewing the adequacy of internal audit function if any including the structure ofthe internal audit department staffing and seniority of the official heading thedepartment reporting structure coverage and frequency of internal audit.
Discussion with internal auditors any significant findings and follow up thereon.
Reviewing the findings of any internal investigations by the internal auditors intomatters where there is suspected fraud or irregularity or a failure of internal controlsystems of a material nature and reporting the matter to the Board.
Discussion with external auditors before the audit commences about the nature andscope of audit as well as post-audit discussion to ascertain any area of concern.
To Review in Companys financial and risk management policies.
To look into the reasons for substantial defaults in the payment to depositorsdebenture holders.
Composition of the Audit Committee as on March 31 2017:
#The Audit Committee consists of two Independent Directors as members.
Meetings and Attendance:
Five Audit Committee Meetings were held during the year ended 31st March2017. The maximum time gap between any of the two meetings was not more than four months.
Audit Committee Meetings held during the year 2016-17 and attendance details:
#Company Secretary of the Company is the Secretary to the Committee.
The Statutory Auditors of the Company were invited to join the Audit Committee in themeetings for discussing the financial results financial statements and the Annual/AuditedAccounts before placing it to the Board of Directors.
Nomination and Remuneration Committee:
Brief description of terms of reference;
composition name of members and chairperson; meeting and attendance during the year;
Performance evaluation criteria for independent directors.
(4) NOMINATION & REMUNERATION COMMITTEE
The terms of reference of Nomination & Remuneration Committee encompass therequirements of Section 178 of Companies Act 2013 and Regulation 18 of SEBI LODR(Regulations) 2015.
The key role of this Committee is as follows:
Provide oversight on Strategic Human Capital issues.
For the position of Whole -Time Director and other Directors and their engagement termsto the Board.
Evaluate and approve for appointment candidates recommended by Whole -Time Director forkey senior positions.
Review the Succession Plan for Critical Positions and suggest actions.
Have the responsibility for setting the remuneration for the Whole Time Directors.Review and take into notice remuneration for the direct reports of the Whole -TimeDirector. Remuneration in this context will include salary and performance based variablecomponent and any compensation payments such as retiring benefits or stock options.
Mandate Role and Responsibilities of the Nomination and Remuneration Committee:
As specified under the Companies Act 2013 Rules under the Companies Act 2013Regulation 18 of SEBI LODR (Regulations) 2015 and regulatory requirements that may comeinto force from time to time; and as may be mandated by the Board of Directors from timeto time.
Composition of the Nomination and Remuneration Committee as on March 31 2017:
Meetings and Attendance
a. Remuneration of Directors:
i. Criteria of making payments to non-executive directors. alternatively this may bedisseminated on the listed entitys website and reference drawn thereto in the annualreport;
The Nomination and Remuneration (N&R) Committee has adopted a Charter which interalia deals with the manner of selection of Board of Directors. The said criteria areaccordingly derived from the adopted Charter.
The Non-Executive Independent Directors receive remuneration by way of sitting feesreimbursement of expenses for participation in the Board / Committee meetings andcommission as detailed hereunder:
A Non-Executive Independent Director receive sitting fees for each meeting of the Boardor Committee of the Board attended by him of such sum as may be approved by the Board ofDirectors within the overall limits prescribed under the Companies Act2013 and TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014;
A Non-Executive Director may also receive commission on an annual basis of such sum asmay be approved by the Board on the recommendation of the N&R Committee;
In determining the quantum of commission payable to the Directors the N&RCommittee shall make its recommendation after taking into consideration the overallperformance of the Company and the onerous responsibilities required to be shouldered bythe Director. The total commission payable to the Directors shall not exceed 1% of the netprofit of the Company in any case.
ii. disclosures with respect to remuneration: in addition to disclosures required underthe
Companies Act 2013 the following disclosures shall be made:
Remuneration policy -
i) For Whole time Director
The total remuneration pursuant to shareholders approval consists of:
A fixed component consisting of salary and perquisites
(Rs. in Lakhs)
Stakeholders' grievance committee:
General body meetings:
(a) Location and time where last three annual general meetings held;
(b) Whether any special resolutions passed in the previous three Annual GeneralMeetings;
(c) whether any special resolution passed last year through postal ballot details ofvoting pattern;
No Such Resolution passed through postal Ballot.
(d) Person who conducted the postal ballot exercise;
(e) whether any special resolution is proposed to be conducted through postal ballot;
(f) Procedure for postal ballot.
Means of communication:
(g) Quarterly results;
Following are dates during the financial year when Company has declared Financials:
30.05.2016 13.08.2016 14.11.2016 and 14.02.2017
(h) Newspapers wherein results normally published;
The quarterly unaudited results and annual audited results are published in BusinessStandard/Financial Express and in the local newspaper Surya/ Nava Telangana and aredisplayed on the Website of the Company. Official press releases and Official mediareleases are sent to stock exchanges.
(i) Website where displayed;
The Company Updates its the entire official Business and Investor relatedinformation on www.cesltd.com
(j) Whether it also displays official news releases;
It also displays official information on cesltd.com
(k) Presentations made to institutional investors or to the analysts.
The Company has not made any Investor related presentation in the 2016-17 but it hasplans to make it in the 2017-18
General shareholder information:
(l) Annual general meeting - Date Time and Venue;
Annual general meeting to be held on 29.09.2017 at 4: 00 pm at Registered office of theCompany at 7th Floor Tower-A. Ramky Selenium Nanakramguda GachibowliHyderabad 500032 .
(m) Financial year;
(n) The Name and Address of each stock exchange(s)at which the listed entity'ssecurities are listed and a confirmation about payment of annual listing fee to each ofsuch stock exchange(s);
The Company is Listed on two Stock Exchanges:
1. Bombay Stock Exchange
Phiroze Jeejeebhoy Towers Dalal Street Mumbai-400001.
2. Ahmedabad Stock Exchange
Kamadhenu Complex Opp. Sahajanand College Panjarapole Ahmedabad-380015.
We hereby do confirm that we had paid the Annual Listing fees for Bombay StockExchange.
(o) Stock code;
Stock code for Bombay Stock Exchange: 512341 Stock Code for Ahmedabad Stock Exchange:52380
(p) Market price data- high low during each month in last financial year;
(q) Performance in comparison to broad-based indices such as BSE Sensex CRISIL Indexetc;
There is No trading of Shares of the Company.
Registrar to an issue and share transfer agents;
Aarthi Consultants Private Limited 1-2-285 Domalguda Hyderabad- 500029
ISIN for the Equity Shares: INE396F01013
(r) Share transfer system;
These are taken care by RTA of the Company
(s) Distribution of shareholding;
Distribution of Shareholding as on 31st March 2017:
(t) Demat and Physical Shares ;
(u) Outstanding global depository receipts or American depository receipts or warrantsor any convertible instruments conversion date and likely impact on equity;
The Company do not have any such Securities.
(v) Commodity price risk or foreign exchange risk and hedging activities;
The Company has entered into Hedging Contract with IndusInd bank and ICICI Bank forForeign Exchange risk.
(9) OTHER DISCLOSURES:
(a) Disclosures on materially significant related party transactions that may havepotential conflict with the interests of listed entity at large;
No Such instance
(b) Details of non-compliance by the listed entity penalties strictures imposed onthe listed entity by stock exchange(s) or the board or any statutory authority on anymatter related to capital markets during the last three years;
No Such Penalty was imposed on Company
(c) Details of establishment of vigil mechanism whistle blower policy and affirmationthat no personnel has been denied access to the audit committee;
In terms of the requirements of the Companies Act 2013 and SEBI LODR (Regulations )2015 the Company has a vigil mechanism to deal with instance of fraud and mismanagementif any. The Audit Committee reviews the functioning of the vigil/whistle blower mechanismfrom time to time. There were no allegations/disclosures/concerns received during the yearunder review in terms of the vigil mechanism established by the Company.
DECLARATION SIGNED BY THE WHOLE-TIME DIRECTOR STATING THAT THE MEMBERS OF BOARD OFDIRECTORS AND SENIOR MANAGEMENT PERSONNEL HAVE AFFIRMED COMPLIANCE WITH THE CODE OFCONDUCT OF BOARD OF DIRECTORS AND SENIOR MANAGEMENT.
The Board of Directors CES Limited
We Mohana Rao Kancharla and Benarji Mallampatti Chief Financial Officer to thebest of our knowledge and belief certify that:
1) We have reviewed financial statements and cash flow statements for the yearended March 31 2017 and that to the best of our knowledge and belief:
a) These statements do not contain any materially untrue statement or omit any materialfact or contain statements that might be misleading;
b) These statements together present a true and fair view of the Companys affairsand are in compliance with existing accounting standards applicable laws and regulations.
2) There are to the best of our knowledge and belief no transactions enteredinto by the Company during the year which are fraudulent illegal or which violate theCompanys code of conduct.
3) We are responsible for establishing and maintaining internal controls for financialreporting and we have: a) Evaluated the effectiveness of the internal control systemsof the Company pertaining to financial reporting;
b) Disclosed to the auditors and the Audit Committee deficiencies in the design oroperation of internal controls if any of which we are aware; and
c) The steps we have taken or propose to take to rectify these deficiencies
4) We have indicated to the Companys Auditors and the Audit Committee ofthe Board of Directors:
a) Significant changes that have occurred in the internal control over financialreporting during the year; b) All significant changes in accounting policies during theyear if any and that the same have been disclosed in the notes to the financialstatements; and c) Instances of significant fraud if any of which we are aware and theinvolvement therein of the management or an Employee having a significant role in theCompanys internal control system over financial reporting; d) All deficiencies ifany in the design or operation of internal controls which could adversely affect the
Companys ability to record process summarize and report financial data andhave identified for the Companys Auditors any material weaknesses in internalcontrols over financial reporting including any corrective actions with regard todeficiencies.
COMPLIANCE CERTIFICATE FROM EITHER THE AUDITORS REGARDING COMPLIANCE OF CONDITIONS OFCORPORATE GOVERNANCE SHALL BE ANNEXED WITH THE DIRECTORS REPORT.
AUDITORS CERTIFICATE ON CORPORATE GOVERNANCE
TO THE MEMBERS OF CES LIMITED
We have examined the compliance of conditions of Corporate Governance by CES Limited("the Company") for the year ended March 31 2017 as per Regulation 15(2)of Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) 2015 for the period April 1st 2016 to March 31st 2017.
The compliance of conditions of Corporate Governance is the responsibility of themanagement. Our examination was limited to a review of the procedures and implementationthereof adopted by the Company for ensuring the compliance of the conditions of CorporateGovernance. It is neither an audit nor an expression of opinion on the financialstatements of the Company.
In our opinion and to the best of our information and according to the explanationsgiven to us and the representations made by the Directors and the management we certifythat the Company has complied with the conditions of Corporate Governance as stipulated inthe above- mentioned Listing Agreement/Listing Regulation as applicable.
We further state that such compliance is neither an assurance as to the futureviability of the Company nor of the efficiency or effectiveness with which the managementhas conducted the affairs of the Company.
(Firm Regn No: 007257S)
M/s P.MURALI CO. Chartered
Accountants 6-3-655/2/3 Somajiguda
Hyderabad - 500 082.
DISCLOSURES WITH RESPECT TO DEMAT SUSPENSE ACCOUNT/ UNCLAIMED SUSPENSE ACCOUNT
The listed entity shall disclose the following details in its Annual Report as long asthere are shares in the demat suspense account or unclaimed suspense account asapplicable:
(a) Aggregate number of shareholders and the outstanding shares in the suspense accountlying at the beginning of the year;
(b) Number of shareholders who approached listed entity for transfer of shares fromsuspense account during the year;
(c) Number of shareholders to whom shares were transferred from suspense account duringthe year;
(d) Aggregate number of shareholders and the outstanding shares in the suspense accountlying at the end of the year;
(e) That the voting rights on these shares shall remain frozen till the rightful ownerof such shares claims the shares.