Your Directors are pleased to present their Report together with the Audited FinancialStatements for the financial year ended on March 31 2016.
Your Companys performance during the financial year ended on March 312016 issummarized below:
| || ||(Rs In Lacs) |
|Particulars ||2015-16 ||2014-15 |
|Total Income ||97927.49 ||87502.79 |
|Earnings before interest tax depreciation and amortization (EBITDA) ||27845.89 ||22293.28 |
|Less: Depreciation and amortization expense ||2249.50 ||2432.27 |
|Less: Finance costs ||1133.23 ||1053.59 |
|Profit before Tax ||24463.16 ||18807.42 |
|Less: Tax Expense || || |
|Current Tax ||6179.74 ||4741.78 |
|Deferred Tax charge / (credit) ||228.73 ||(20.53) |
|Profit for the year from continuing operations ||18054.69 ||14086.17 |
|Add: Balance as per last financial statements ||41363.46 ||28414.59 |
|Amount available for appropriation || || |
|Appropriations - || || |
| Proposed Anal equity dividend ['1.20 per Equity Share of '10/- each i.e. 12% (previous year - '1.20 per Equity Share i.e. @ 12%)] ||880.73 ||880.73 |
|Tax on proposed equity dividend ||179.29 ||179.29 |
|Adjustments in reserves on account of change in life of assets as per the Companies Act 2013 ||- ||77.28 |
|Net surplus in the Statement of Profit and Loss ||58358.13 ||41363.46 |
Your Directors are pleased to recommend a dividend of '1.20 per Equity Share of '10/-each i.e. @ 12% (previous year - '1.20 per Equity Share i.e. @ 12%) for the financial yearended on March 31 2016 and seek your approval for the same.
The proposed dividend payment including Corporate Dividend Distribution Tax wouldentail an outflow of '1060.02 Lacs (previous year Rs 1060.02 Lacs).
COMPANY PERFORMANCE AND FUTURE OUTLOOK
A detailed analysis and insight into the financial performance and operations of yourCompany for the year under review and future outlook is appearing in the ManagementDiscussion and Analysis which forms part of this Annual Report.
SCHEME OF ARRANGEMENT
With a view to create a separate entity focused on the emerging opportunities in thedigital media space your
Directors had approved a Scheme of Arrangement u/s 391-394 of the Companies Act 1956between the Company and HT Digital Streams Limited a wholly-owned subsidiary of HT MediaLimited (holding company) for transfer and vesting of the Multi-media Content ManagementUndertaking of the Company to and in HT Digital Streams Limited as a 'going concern' on aslump exchange basis ("Scheme"). In the said connection pursuant to the orderof the Hon'ble High Court of Judicature at Patna meetings of Equity Shareholders andUnsecured Creditors of the Company were convened wherein the Scheme was approved withrequisite majority. The petition seeking sanction of the Scheme is pending before theHon'ble High Court of Judicature at Patna.
Your Company has a robust risk management framework to identify evaluate and mitigatebusiness risks. A detailed statement indicating development and implementation of a riskmanagement policy including identification therein the various elements of risk isappearing in the Management Discussion and Analysis.
EMPLOYEE STOCK OPTION SCHEME
The information required to be disclosed pursuant to the provisions of the Securitiesand Exchange Board of India (Share Based Employee Benefits) Regulations 2014 read withSEBI's circular no. CIR/CFD/POLICY CELL/2/2015 dated June 16 2015 is available on theCompany's website viz. www.hmvl.in.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the year under review Dr. Mukesh Aghi was appointed as Independent Directornot liable to retire by rotation to hold office for 5 (five) consecutive years for a termup to March 31 2020. Further the Board of Directors had appointed subject to approvalof members Shri Priyavrat Bhartia as Whole-time Director of the Company for a period of 5(five) years w.e.f. October 1 2015. Your Directors recommend the appointment of ShriPriyavrat Bhartia as Whole-time Director of the Company at the ensuing Annual GeneralMeeting (AGM). Further in accordance with the provisions of the Companies Act 2013 ShriPriyavrat Bhartia retires by rotation at the ensuing AGM and being eligible has offeredhimself for re-appointment. Your Directors also recommend his re-appointment at theensuing AGM.
All Independent Directors of the Company have confirmed that they meet the criteria ofindependence as prescribed under both the Companies Act 2013 and of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 ("SEBI Regulations").
During the year under review Shri Vikram Singh Mehta Non-executive IndependentDirector and Shri Rajiv Verma Non-executive Director tendered resignation from the Boardof Directors of the Company w.e.f. June 12 2015 and September 11 2015 respectively. TheBoard places on record its sincere appreciation for the valuable contribution made by ShriVikram Singh Mehta and Shri Rajiv Verma during their tenure on the Board of Directors ofthe Company.
There has been no change in Key Managerial Personnel during the year under review.
The Board undertook a formal evaluation of its own performance and that of itsCommittees & individual Directors. The Nomination & Remuneration Committee led theevaluation process. Structured questionnaires were devised and circulated to all theDirectors of the Company seeking their feedback on Board effectiveness and performance ofIndividual Directors Board Committees & the Chairperson.
The Independent Directors were evaluated on various parameters including functionalskill-set quality of inputs/ suggestions engagement & participation in key businessdecisions awareness of the risk profile of the industry etc.
The Board would endeavour to use the results of the evaluation process constructivelyimprove its own effectiveness and deliver performance.
The members of the Company at their AGM held on September 8 2014 had appointed S.R.Batliboi & Co. LLP Chartered Accountants [Firm Registration No. 301003E]("SRB") as statutory auditors of the Company to hold office till the conclusionof the third consecutive AGM to be held in the calendar year 2016 (subject to ratificationof their appointment at the AGM to be held in the calendar year 2015). Accordingly theappointment of SRB as statutory auditors was ratified at the AGM held on August 28 2015.In terms of the provisions of Section 139 and other applicable provisions of the CompaniesAct 2013 and rules made thereunder the Audit Committee and Board of Directors recommendthe re-appointment of SRB as statutory auditors of the Company till the conclusion of AGMto be held in calendar year 2017. The Company has received a certificate from SRB to theeffect that their re-appointment as statutory auditors shall be in accordance with theprovisions of Section 141 of the Companies Act 2013.
The Auditors Report is unmodified i.e. it does not contain any qualificationreservations or adverse remarks.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and rules madethereunder the Board of Directors had appointed Shri N.C. Khanna CompanySecretary-inPractice (C.P. No. 5143) as Secretarial Auditor to conduct the SecretarialAudit for Financial Year 2015-16. The Secretarial Audit Report is annexed herewith asAnnexure "A".
There are no qualifications reservations or adverse remarks in the Secretarial AuditReport.
During the year under review the Statutory Auditors and the Secretarial Auditor havenot reported any incident of fraud under Section 143 (12) of the Companies Act 2013.
RELATED PARTY TRANSACTIONS
All contracts / arrangements / transactions entered into by the Company with relatedparties during the year under review were on arm's length terms and were placed beforethe Audit Committee for review and approval. During the year under review the Company hadentered into one transaction with a related party which was material as per the policy on'Materiality of and dealing with Related Party Transactions' (available on Company'swebsite viz. www.hmvl.in). In terms of the said transaction the Company acquired'Hindustan' and other Hindi publication related trademarks from HT Media Limited (holdingcompany) at a consideration of Rs 62 Crore (excluding taxes and other statutory levies).The above transaction was approved by the shareholders of the Company at the AGM held onAugust 28 2015. The required particulars of the said transaction in form AOC-2 isannexed herewith as Annexure - "B".
Reference of the members is invited to Note no. 31 to the financial statements whichsets out the related party disclosures as per Accounting Standard 18.
CORPORATE SOCIAL RESPONSIBILITY
The Company has constituted the Corporate Social Responsibility (CSR) Committee ofDirectors in terms of Section 135 of the Companies Act 2013. The composition and terms ofreference of the CSR Committee are provided in the Report on Corporate Governance. The CSRCommittee formulated and recommended to the Board a CSR Policy indicating the activitiesto be undertaken by the Company which was approved by the Board. The CSR Policy of theCompany is available on the Company's website viz. www.hmvl.in.
The Annual Report on CSR activities during FY 16 is annexed herewith as Annexure"C".
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134 of the Companies Act 2013 your Directors state that:
i) in the preparation of the annual accounts for the financial year ended on March312016 the applicable Accounting Standards have been followed and there are no materialdepartures;
ii) such accounting policies have been selected and applied consistently and judgmentsand estimates have been made that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as on March 31 2016; and of the profit of theCompany for the year ended on March 312016;
iii) proper and sufficient care has been taken for the maintenance of adequateaccounting
records in accordance with the provisions of the Companies Act 2013 for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
iv) the annual accounts have been prepared on a going concern basis;
v) proper internal financial controls were in place and that the such internalfinancial controls were adequate and operating effectively; and
vi) systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
DISCLOSURES UNDER THE COMPANIES ACT 2013
Borrowings and Debt Servicing: During the year under review your Company has met allits obligations towards repayment of principal and interest on the loans availed.
Particulars of loans given investments made guarantees/ securities given: The detailsof investments made and loans/guarantees/securities given as applicable form part of thenotes to the financial statements.
Board Meetings: During the financial year ended on March 312016 the Board met fivetimes on May 14 2015 July 14 2015 October 26 2015 November 19 2015 and January 252016 . For further details members may please refer Report on Corporate Governance.
Committees of the Board: The Board has constituted five standing committees viz. AuditCommittee Nomination and Remuneration Committee Corporate Social ResponsibilityCommittee Investment and Banking Committee and Stakeholders' Relationship Committee. Adetailed note on the Board and its Committees is provided under the Report on CorporateGovernance.
Remuneration Policy: The Board on the recommendation of the Nomination andRemuneration Committee has framed a policy on appointment of Directors Key ManagerialPersonnel & senior management and fixing their remuneration.
Vigil Mechanism: A "Whistle Blower Policy" (vigil mechanism) is in place toprovide opportunity to directors/ employees/stakeholders of the Company to report concernsabout unethical behavior actual or suspected fraud by any director and/or employee of theCompany or any violation of the Code of Conduct.
Particulars of Employees and Related Disclosures: In accordance with the provisions ofSection 197(12) of the Companies Act 2013 and Rule 5(2)&(3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the names and otherparticulars of employees are set out in the Annexure "D" to this report. Interms of the provisions of Section 136(1) of the Companies Act 2013 the Board's Reportis being sent to the shareholders without this annexure. However the same is availablefor inspection by the members at the Registered Office of the Company during businesshours on all working days upto the date of the ensuing AGM. Members interested inobtaining a copy of the same may write to the Company Secretary at the Registered Officeof the Company.
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is annexed herewith as " Annexure"E".
Extract of Annual Return: Extract of the Annual Return of the Company (in form MGT-9)is annexed herewith as Annexure "F".
Corporate Governance Report: The Report on Corporate Governance in terms of SEBIRegulations forms part of this Annual Report. The certificate issued by a CompanySecretary-in-Practice in terms of the requirement of the SEBI Regulations is annexedherewith as Annexure "G"
Energy conservation technology absorption and foreign exchange earnings & outgo:The information on conservation of energy technology absorption and foreign exchangeearnings & outgo as required to be disclosed under the Companies Act 2013 is annexedherewith as Annexure "H".
Your Directors state that no disclosure is required in respect of the following mattersas there were no transaction in relation thereto during the year under review:
1. Details relating to deposits covered under Chapter V of the Companies Act 2013.
2. Issue of equity shares with differential rights as to dividend voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company underany scheme of the Company.
4. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the 'going concern' status and Company's operations in future.
There was no change in the Share Capital of the Company during the year under review.
No material changes/commitments affecting the financial position of the Company haveoccurred after the end of the financial year 2015-16 and till the date of this report.
Your Company has in place adequate internal financial controls with reference to thefinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operations were observed.
Your Directors place on record their sincere appreciation for the co-operation extendedby all stakeholders including Ministry of Information & Broadcasting and othergovernment authorities shareholders investors readers advertisers customers banksvendors and suppliers. Your Directors also place on record their deep appreciation of thecommitted services of the executives and employees of the Company.
For and on behalf of the Board
|Place: New Delhi ||Shobhana Bhartia |
|Date: May 25 2016 ||Chairperson |