Hathway Bhawani Cabletel & Datacom Ltd.
|BSE: 509073||Sector: Services|
|NSE: N.A.||ISIN Code: INE525B01016|
|BSE LIVE 14:52 | 29 Aug||Stock Is Not Traded.|
|NSE 05:30 | 01 Jan||Stock Is Not Traded.|
|BSE: 509073||Sector: Services|
|NSE: N.A.||ISIN Code: INE525B01016|
|BSE LIVE 14:52 | 29 Aug||Stock Is Not Traded.|
|NSE 05:30 | 01 Jan||Stock Is Not Traded.|
Your Directors have pleasure in presenting the Thirty Second (32nd) Annual Report ofthe Company together with the Audited Statement of Accounts for the financial year ended31stMarch 2016.
1. FINANCIAL & OPERATION OVERVIEW
a. Financial Highlights
The Company's performance during the year ended 31st March 2016 as compared to theprevious financial year is summarized below:
(Rs In Lakhs)
During the year under review the total income of your Company marginally increased toRs 1734.80 Lakhs as compared to last year's income of Rs 1550.97 Lakhs on standalonebasis. During the year under review the Company incurred a net loss of Rs 148.46 Lakhs onstandalone basis due to steep increase in operating expenses mainly on account of paychannel cost services charges and provision for bad and doubtful debts during the year.The Company is adhering to its policy of focused growth and as a result of which the totalsubscription income vis-a-vis the gross operating profit of the Company has increasedduring the year under review.
b. Operational Highlights:
(I) Cable TV Business:
During the year under review your Company has seeded 1500 Set Top Boxes (STB)cumulatively totaling to approximate 72000 STB seeded. Your Company will continue to seedboxes at a rapid pace in near future as well.
The strategy of your Company is to seed more High Definition (HD) STB's in order toincrease the average rate per unit ("ARPU"). We anticipate that with smarterpackaging the Company will be able to drive higher ARPU.
Your Company has received a good feedback on HD product proposition. The proposition ispriced at Rs. 152/- per month in which the customer can view 50 high quality HD channels.
We believe that value added services and innovative content will give a further fillipto ARPU in the future.
(ii) Broadband Business
As of 31st March 2016 your Company has over 1500 plus broadband subscribers. With ahigh quality and high capacity HFC Network your Company is well placed to garner a largershare of the growing broadband market. Based on continuous customer service improvementwe could also improve customer ARPU by Rs 400/- on monthly basis.
c. Change in the nature of business
During the year under review there has been no change in the nature of business.
d. Consolidated Accounts
The consolidated financial statements of your Company for the financial year 2015-2016are prepared in compliance with applicable provisions of the Companies Act 2013Accounting Standards and Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015.
e. Management Discussion and Analysis
The Management Discussion and Analysis forms an integral part of this Report and givesdetail of the overall industry overview business overview and performance review andstate of affairs of the Company in Cable Television business and Broadband business duringthe year under review.
f. Report on performance of subsidiaries associates and joint venture Companies
A statement containing the performance and financial position of the SubsidiaryCompany associates and joint venture companies for the year ended 31st March 2016 isgiven pursuant to Section 129(3) of the Companies Act 2013 read with Rule 5 and 8 of theCompanies (Accounts) Rules 2014 in AOC-1 in Annexure-I to this report.
The details of the subsidiary are as follows:
The financial statements of the subsidiary company and related information areavailable for inspection by the members at the Registered Office of your Company duringbusiness hours on all days except Saturdays Sundays and public holidays up to the date ofthe Annual General Meeting (AGM) as required under Section 136 of the Companies Act 2013.Any member desirous of obtaining a copy of the said financial statements may write to theCompany Secretary at the Registered Office of your Company.
Considering the loss incurred in the current financial year your Directors have notrecommended any dividend for the financial year under review.
h. Transfer to reserves
In view of losses incurred during the year under review the Board of Directors has notrecommended transfer of any amount to reserves.
i. Revision of financial statement
There was no revision of the financial statements during the year under review.
The Company has not accepted any public deposits during the year under review.
k. Disclosures under section 134(3)(i) of the Companies Act 2013
Except as disclosed elsewhere in this report no material changes and commitments whichcould affect the Company's financial position have occurred between the end of thefinancial year of the Company and date of this report.
l. Disclosure of Internal Financial Controls
The Internal Financial Controls with reference to financial statements as designed andimplemented by the Company are adequate. During the year under review no material orserious observations has been received from the Internal Auditors of the Company forinefficiency or inadequacy of such controls.
m. Particulars of loans guarantees investments and securities
There are no loans given investments made guarantees given and securities providedduring the year under review.
2. MATTERS RELATED TO DIRECTORS AND KEY MANAGERIAL PERSONNEL
a) CHANGE IN BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
Ms. Nandita Swamy (DIN: 03181823) Independent Director of the Company resigned fromthe Board with effect from January 222016.
In accordance with the provisions of the Companies Act 2013 none of the IndependentDirectors is liable to retire by rotation.
As per the provisions of Section 152 of the Companies Act 2013 Mr. Shyam P V. (DIN:07247247) shall retire by rotation at the ensuing Annual General Meeting and beingeligible offers himself for re-appointment. Your Directors recommend the same for yourapproval.
Mr. Dilip Vaidya Company Secretary & Compliance Officer a Key ManagerialPersonnel (KMP) of the company resigned with effect from February 112016 and Mr. ManojDere was appointed as a Company Secretary & Compliance Officer a Key ManagerialPersonnel (KMP) in his place as on that date.
b. DECLARATION BY INDEPENDENT DIRECTORS
The Company has received declaration from all the Independent Directors under Section149(6) of the Companies Act 2013 confirming their independence vis-a-vis the Company.
3. DISCLOSURES RELATED TO BOARD COMMITTEESAND POLICIES
The Board of Directors met 4 times during the financial year ended 31st March 2016 inaccordance with the provisions of the Companies Act 2013 and rules made thereunder.
The dates on which the Board of Directors met during the financial year under revieware as under:
The Audit Committee of Directors was constituted pursuant to the provisions of Section177 of the Companies Act 2013. The composition of the Audit Committee is in conformitywith the provisions of the said section. The Audit Committee as on the date of this reportcomprises of:
The scope and terms of reference of the Audit Committee have been amended in accordancewith the Act and the Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015.
During the year under review the Board of Directors of the Company had accepted allthe recommendations of the Committee.
c. NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee of Directors as constituted by the Board ofDirectors of the Company in accordance with the requirements of Section 178 of the Act.
The composition of the committee as on the date of this report is as under:
The Board of Directors has in accordance with the provisions of sub-section (3) ofSection 178 of the Companies Act 2013 formulated the policy setting out the criteria fordetermining credentials positive attributes independence of a Director and policyrelating to remuneration for Directors Key Managerial Personnel and other employees.
d. STAKEHOLDERS RELATIONSHIP COMMITTEE
Pursuant to Section 178 of the Companies Act 2013 the Board of Directors of theCompany has constituted the Stakeholder's Relationship Committee comprising of:
The Company's Independent Directors meet at least once in every financial year withoutthe presence of Executive Director or management personnel and is conducted informally. Ameeting of Independent Director was held on 11th February 2016 during the year underreview.
f. VIGIL MECHANISM POLICY FOR THE DIRECTORS AND EMPLOYEES
The Board of Directors of the Company has pursuant to the provisions of Section 177(9)of the Companies Act 2013 read with Rule 7 of the Companies (Meetings of Board and itsPowers) Rules 2014 framed "Vigil Mechanism Policy" for Directors and employeesof the Company to provide a mechanism which ensures adequate safeguards to employees andDirectors from any victimization on raising of concerns of any violations of legal orregulatory requirements incorrect or misrepresentation of any financial statements andreports etc.
The employees of the Company have the right/option to report their concern/grievance tothe Chairman of the Audit Committee.
The Company is committed to adhere to the highest standards of ethical moral and legalconduct of business operations.
The Board of Directors of the Company has designed Risk Management Policy andGuidelines to avoid events situations or circumstances which may lead to negativeconsequences on the Company's businesses and define a structured approach to manageuncertainty and to make use of these in their decision making pertaining to all businessdivisions and corporate functions. Key business risks and their mitigation are consideredin the annual/strategic business plans and in periodic management reviews.
h. CORPORATE SOCIAL RESPONSIBILITY POLICY
As per the provisions of Section 135 of the Act read with Companies (Corporate SocialResponsibility Policy) Rules 2014 the Board of Directors has constituted a CorporateSocial Responsibility (CSR) Committee as under:
The Board of Directors of the Company has approved CSR Policy based on therecommendation of the CSR Committee. Since the Company has no profits in preceding 3financial years the Company was not required to spent any amount for corporate socialresponsibility activities.
i. ANNUAL EVALUATION OF DIRECTORS COMMITTEEAND BOARD
In accordance with the Companies Act 2013 and Schedule V of Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015 theCompany has framed a Policy for evaluation of performance of Independent Directors BoardCommittees and other Individual Directors which includes criteria for performanceevaluation of non-executive directors and executive directors. A questionnaire wasformulated for evaluation of performance of Board after taking into consideration thefollowing aspects:
Board functioning and Team Dynamics.
Performance evaluation of Independent Directors was conducted by the Board ofDirectors excluding the Director being evaluated. The criteria for performance evaluationof Independent Directors laid down by the Nomination Remuneration and CompensationCommittee is as below:
Ethics and values
knowledge and proficiency
Behavioral traits and
Efforts for personal development
Similarly performance evaluation of the Chairman and Non - Independent Directors wascarried out by the Independent Directors at the meeting of the Board of Directors held on11th February 2016.
j. DISCLOSURE UNDER SECTION 197(12) OF THE COMPANIES ACT 2013 AND OTHER DISCLOSURES ASPER RULE 5 OF COMPANIES (APPOINTMENT & REMUNERATION) RULES 2014
The ratio of the remuneration of each Director to the median remuneration of theemployees of the Company for the financial year under review has been marked as AnnexureII.
k. POLICYON DIRECTORSAPPOINTMENTAND REMUNERATION
The Board has in accordance with the provisions of sub-section (3) of Section 178 ofthe Companies Act 2013 formulated the policy setting out the criteria for determiningqualifications positive attributes independence of a Director and policy relating toremuneration for Directors Key Managerial Personnel and other employees.
4. DIRECTOR'S RESPONSIBILITYSTATEMENT
In terms of Section 134(5) of the Companies Act 2013 in relation to the auditedfinancial statements of the Company for the year ended 31st March 2016 the Board ofDirectors hereby confirms that:
a. in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;
b. such accounting policies have been selected and applied consistently and theDirectors made judgments and estimates that are reasonable and prudent so as to give atrue and fair view of the state of affairs of the Company as at 31st March 2016 and ofthe loss of the Company for that year;
c. proper and sufficient care was taken for the maintenance of adequate accountingrecords in accordance with the provisions of this Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities;
d. the annual accounts of the Company have been prepared on a going concern basis;
e. internal financial controls have been laid down to be followed by the Company andthat such internal financial controls are adequate and were operating effectively;
f. proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
5. AUDITORS AND REPORTS
The matters related to Auditors and their Reports are as under
a. OBSERVATIONS OF STATUTORY AUDITORS ON ACCOUNTS FOR THE YEAR ENDED 31ST MARCH 2016
The observations made by the Statutory Auditors in their report for the financial yearended 31st March 2016 read with the explanatory notes therein are self-explanatory andtherefore do not call for any further explanation or comments from the Board underSection 134(3) of the Companies Act 2013.
During the year under review there were no instances of material or serious fraudfalling under Rule 13(1) of the Companies (Audit and Auditors) Rules 2013 by officers oremployees reported by the Statutory Auditors of the Company during the course of theaudit.
c. SECRETARIAL AUDIT REPORT FOR THEYEAR ENDED 31ST MARCH 2016
Provisions of Section 204 read with Section 134(3) of the Companies Act 2013 mandatesto obtain Secretarial Audit Report from Practicing Company Secretary. M/s Rathi andAssociates Company Secretaries was appointed to issue Secretarial Audit Report for thefinancial year 2015-2016.
Secretarial Audit Report issued by M/s Rathi and Associates Company Secretaries forthe financial year 2015-2016 in Form MR-3 has been marked as Annexure III and forms partto this report. The Secretarial Auditors in their report have commented that noexplanation has been offered in the Directors Report 2014-2015 on their comments onuploading documents on the website of the Company. Your Directors state that the saiderror occurred purely due to inadvertence without any malafide intention. The Company hasuploaded the relevant data as required under regulation 46 of the Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015.
d. RATIFICATIONOFAPPOINTMENTOF AUDITORS
Pursuant to the provisions of Section 139 of the Companies Act 2013 and the Companies(Audit and Auditors) Rules 2014 M/s. G. M. Kapadia & Co Chartered Accountants theStatutory Auditors of the Company have been appointed for a term of 3 years. However asper the provisions of Section 139 their appointment as Statutory Auditors of the Companyshall be required to be ratified by the Members at the ensuing Annual General Meeting.
Necessary resolution for ratification of appointment of the said Auditors is includedin the Notice of AGM for seeking approval of members.
During the year the Company had not entered into any contract / arrangement /transaction with related parties which could be considered material in accordance with thepolicy of the Company on materiality of related party transactions.
Other disclosures as per provisions of Section 134 of the Act read with Companies(Accounts) Rules 2014 are furnished as under
Pursuant to the provisions of Section 134(3)(a) of the Companies Act 2013 Extract ofthe
Annual Return for the financial year ended 31st March 2016 made under the provisionsof Section 92(3) of the Act is attached as Annexure lV which forms part of this Report.
b. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGSANDOUTGO
The particulars as required under the provisions of Section 134(3) (m) of the CompaniesAct 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 in respect ofconservation of energy technology absorption foreign exchange earnings and outgo etc.have been furnished in Annexure V which forms part of this Report.
c. DISCLOSURE RELATING TO EQUITY SHARES WITH DIFFERENTIAL RIGHTS
The Company has not issued any equity shares with differential rights during the yearunder review and hence no information as per provisions of Section 43(a)(ii) of theCompanies Act 2013 read with Rule 4(4) of the Companies (Share Capital and Debenture)Rules 2014 is furnished.
d. DISCLOSURE RELATING TO SWEAT EQUITY SHARE
The Company has not issued any sweat equity shares during the year under review andhence no information as per provisions of Section 54(1)(d) of the Companies Act 2013 readwith Rule 8(13) of the Companies (Share Capital and Debenture) Rules 2014 isfurnished.
e. DISCLOSURE RELATING TO EMPLOYEE STOCK OPTION SCHEME AND EMPLOYEE STOCK PURCHASESCHEME:
The Company does not have any Employee Stock Option Scheme or Employee Stock PurchaseScheme. Hence no information as per the provisions of Section 62(1)(b) of the CompaniesAct 2013 read with Rule 12(9) of the Companies (Share Capital and Debenture) Rules 2014has been furnished.
f. SHARE CAPITAL
During the year under review the Company has not issued any shares and hencedisclosures under Section 43(a)(ii) Section 54(1)(d) and Section 62(1)(b) of theCompanies Act 2013 read with relevant rules are not required to be furnished. The Companydoes not have a scheme of ESOP and hence disclosures pursuant to Section 67(3) of theCompanies Act 2013 are also not required to be furnished.
g. CORPORATE GOVERNANCE: (Applicable to Companies giving remuneration as per Section IIof Schedule V)
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
1. Acceptance of deposits covered under Chapter V of the Act.
2. Payment of remuneration or commission from any of its Holding or subsidiaryCompanies to the Managing Director or the Whole-time Directors of the Company.
3. Significant or material orders passed by the Regulators or Courts or Tribunals whichimpact the going concern status and Company's operations in future.
4. Cases filed pursuant to the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013.
8. ACKNOWLEDGEMENTS AND APPRECIATION
Your Directors take this opportunity to thank the customers shareholders suppliersbankers business partners/associates financial institutions and Central and StateGovernments for their consistent support and encouragement to the Company.
For and on behalf of the Board