The Board of Directors hereby submits the report of the business and operations of yourCompany (the company' or RAJTV) along with the audited statements for thefinancial year ended March 31st 2017.
1. FINANCIAL SUMMARY/HIGHLIGHTS OF THE COMPANY:
(Rs in Lacs)
|Particulars ||Year ended 31st March 2017 ||Year ended 31st March 2016 |
|Revenue from Operations ||6120.89 ||8244.73 |
|Other Income ||84.58 ||45.80 |
|Total Revenue ||6205.47 ||8290.53 |
|Less : Total Expenses ||6007.30 ||7720.26 |
|Profit/(Loss) before interest Depreciation and Tax ||198.17 ||570.27 |
|Interest ||483.21 ||452.22 |
|Profit/(Loss) before Depreciation and Tax (PBDT) ||(285.04) ||118.05 |
|Depreciation ||649.18 ||654.32 |
|Profit/(Loss) Before Tax (PBT) ||(934.22) ||(536.28) |
|Provision for taxation ||(54.20) ||(68.66) |
|Profit /(Loss) After tax (PAT) ||(880.03) ||(604.94) |
|Balance brought forward ||3052.53 ||3813.67 |
|Adjustment of depreciation as per Transition provisions ||Nil ||Nil |
|Amount available for appropriations ||2172.51 ||3208.73 |
|Final Dividend on Equity Shares ||- ||129.78 |
|Tax on Dividend ||- ||26.42 |
|General Reserve ||- ||- |
|Surplus carried to Balance Sheet ||2172.51 ||3052.53 |
2. EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS:
There have been no material changes and commitments that have occurred after close ofthe financial year till the date of this report which affect the financial position ofthe Company. Based on internal financial control framework and compliance systemsestablished in the Company the work performed by statutory internal and secretarialauditors and reviews performed by the management and/or relevant Audit and otherCommittees of the Board your Board is of the opinion that the Company's internalfinancial controls were adequate and effective during the Financial Year 2016-17.
In view of loss in the current year the Board of Directors does not recommend anydividend for the year ended March 31 2017.
4. RESULT OF OPERATIONS AND THE STATE OF COMPANY'S AFFAIRS CHANGE IN THE NATUREOF BUSINESS IF ANY:
Your Company achieved revenue from operations Rs. 6205.47 lakhs as against Rs.8290.53 lakhs in the P.Y. The Total Expenditure for the period is Rs.7139.69 lakhs asagainst Rs. 8826.81 lakhs in the
The performance of the Company is marginally affected by downfall inadvertisement income due to reduction in the viewership rating for the channels due to thechange in the rating parameters by new rating agency and Writing off of Bad DebtsRs.530.86 Lakhs during the FY 2016-17 owing to various Multi System operators fromDistribution Front
Net Loss After Tax stood at Rs. 880.02 Lakhs as compared to Net loss after taxRs. 604.94 lakhs in the Previous Year.
Your Company had undergone competitive business environment and changing customerpreferences and with the new rating system are in place now the media planners andadvertisers will have to establish new benchmarks to work with the new systems. Furtherthe company is also exploring various options for raising revenue generation with muchfocus on regional market consolidation and exploring various new platforms of revenuegeneration. Your Company today is an established Television Company in the Tamilbroadcasting industry in South India. The Network is presently runs 13 Channels and has 13Channel licenses in various languages and genre and 3 more licenses are in the pipeline tolaunch 3 more channels. Your company has own uplinking station and Exclusive Transponderfacility. Your company broadcasts the channels in whole of India as well as parts ofSouth East Asia and the Middle East.
Your company undertakes several production projects with the right mix of self-producedand outsourced productions to mitigate financial risk and obtain large revenues. Withself-produced content the company gets complete right over the content and can build itsown intellectual property base. The company plans to have more in house media contents inTamil language in various genres.
Your company has an advantage of being a mass channel with its extensive line up ofattractive programming to cater the entire family. The channels of the network reach awide variety of audiences as It satisfies people of all ages The Channel offers a rightmix of movies serials debates cultural educational cookery handicrafts and religiousprogrammes satisfying the needs of the entire community ranging from Urban to the ruralaudience. There are no significant changes in nature of business during the Financial Year2016-17.
5. SHARE CAPITAL
The Company has not issued any shares or any other securities including ADR/GDR/FCCB/WARRANTS/ BONDS ESOP during the year.
6. SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
Company has no Subsidiary Joint Ventures or Associate Companies and same status ismaintained during the F.Y 2016-17.
7. PUBLIC DEPOSITS:
During the year the Company has neither invited nor accepted any deposits from thepublic or its employees.
8. BOARD COMMITTEES
In compliance with the requirements of Companies Act 2013 and Listing Agreements /Listing Regulations your Board had constituted various Board Committees including AuditCommittee Risk Management Committee Nomination & Remuneration CommitteeStakeholders Relationship Committee and Corporate Social Responsibility Committee.
Details of the constitution of these Committees which are in accordance withregulatory requirements have been uploaded on the website of the Company viz.www.rajtvnet.in . Details of scope constitution terms of reference number of meetingsheld during the year under review along with attendance of Committee Members therein formpart of the Corporate Governance Report annexed to this report. A detailed report onCorporate Social Responsibility activities initiated by the Company during the year underreview in compliance with the requirements of Companies Act2013 is annexed to thisreport
9. CORPORATE GOVERNANCE AND POLICIES
The Company is committed to maintain the highest standards of corporate governance andadhere to the corporate governance requirements of Securities and Exchange Board of India(Listing Obligations and Disclosure Requirement) Regulations 2015 (ListingRegulations') and applicable provisions of Companies Act 2013.A detailed report oncorporate governance together with a certificate from the Statutory Auditors incompliance with SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015of the Listing Agreement is attached as part of this report vide Annexure I. Compliancereports in respect of all laws applicable to the Company have been reviewed by the Boardof Directors.
10. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All contracts / arrangements / transactions entered by the Company during the financialyear with related parties were in the ordinary course of business and on an arm's lengthbasis. 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.
11. CORPORATE SOCIAL RESPONSIBILITY
The Corporate Social Responsibility and Governance Committee (CSR&G Committee) hasformulated and recommended to the Board a Corporate Social Responsibility Policy (CSRPolicy) indicating the activities to be undertaken by the Company which has been approvedby the Board. The CSR Policy may be accessed on the Company's website at the link:www.rajtvnet.in.
Your Company has always responded in a responsible manner to the growing needs of thesociety. A number of enriching and enlivening activities that contribute to the communityin the areas of health education environment and preservation of the country's richculture and heritage have been taken up. Annual Report on CSR Activities undertaken by theCompany for the Financial Year 2016-17 is annexed with this report vide Annexure III.
12. DIRECTORS AND KEY MANANGERIAL PERSONNEL:
Your Board comprises of 9 Directors including 4 Independent Directors. IndependentDirectors provide their declarations both at the time of appointment and annuallyconfirming that they meet the criteria of independence as prescribed under Companies Act2013 and SEBI (LODR) 2015. During F.Y. 2016-17your Board met 4 (Four) times details ofwhich are available in Corporate Governance Report annexed to this report.
13. DIRECTORS SEEKING FOR RETIREMENT BY ROTATION:
Director Shri. M. Rajarathnam (Holding DIN 00839174) who retires by rotationand being eligible offers himself for re-appointment. The details of the appointee isannexed along with the notice calling the annual general meeting of the company.
The Board of Directors met 4 times during this financial year. The Board meeting was on27-05-2016 29-07-2016 28-10-2016 and 15-02-2017.
The Independent Directors of your Company in a separate meeting held 27-May-16without presence of other Directors and management evaluated performance of the ChairmanManaging Director and other Non-Independent Directors along with performance of theBoard/Board Committees based on various criteria recommended by Nomination &Remuneration Committee. A report on such evaluation done by Independent Directors wastaken on record by the Board and further your Board in compliance with requirements ofCompanies Act 2013 evaluated performance of all Independent Directors based on variousparameters including attendance contribution etc.
The details about the appointment re-appointment change in Designation resignationof Directors (along with fact of resignation) Managing Directors Whole Time DirectorsKMP Independent Directors is annexed with this report vide Annexure III.
14. DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS
The Company has received necessary declaration from each Independent Directors of theCompany under Section 149(7) of the Companies Act 2013 that the Independent Directors ofthe Company meet with the criteria of their Independence laid down in Section 149(6).
15. BOARD & AUDIT COMMITTEE
The details regarding number of board meetings held during the financial year andcomposition of Audit Committee is furnished in the Corporate Governance Report.
16. AUDITORS AND AUDITORS' REPORT
I. Statutory Auditors
As per Section 139 of the Companies Act 2013 M/s Pratapkaran Paul & Co.Chartered Accountants Chennai having Firm Registration No. 002777S retires as StatutoryAuditors of the Company. Your Board places on record their appreciation for the servicesprovided by M/s. Pratapkaran Paul & Co. Chartered Accountants as Statutory Auditorsof the Company for over two decades.
Based on the recommendations of the Audit Committee and upon review of confirmations ofsatisfaction of criteria as specified in Section 141 of the Companies Act 2013 read withRule 4 of Companies (Audit & Auditors) Rules 2014 your Board had subject toapproval of the Members at the ensuing Annual General Meeting approved appointment ofM/s. N. Naresh & Co. Chartered Accountants (Firm Registration No. FRN: 011293S) asStatutory Auditors of the Company in place of retiring Statutory Auditors. A proposal forappointment of M/s N. Naresh & Co. Chartered Accountants as Statutory Auditors of theCompany until conclusion of 28thAnnual General Meeting to be held in the year2022 subject to ratification by Equity Shareholders every year forms part of the Noticeof ensuing Annual General Meeting.
The Notes on financial statement referred to in the Auditors' Report areself-explanatory and do not call for any further comments. The Auditors' Report does notcontain any qualification reservation or adverse remark.
II. Secretarial Auditor
The Members has appointed M/s V. Nagarajan & Co. Practising Company Secretary toconduct Secretarial Audit for the F.Y. 2016-17. The Secretarial Audit Report for thefinancial year ended March 31 2017 is annexed herewith marked as Annexure V to thisReport. The Secretarial Audit Report does not contain any qualification reservation oradverse remark.
I. PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
During the period under review company has no transactions to be reported under thedisclosure of Particulars of loans guarantees and investments made by the Companyrequired under section 186 (4) of the Companies Act 2013.
II. TRANSACTIONS WITH RELATED PARTIES:
None of the transactions with related parties fall under the scope of Section 188(1) ofthe Act.
Information on material transactions with related parties pursuant to Section 134(3)(h)of the Act read with rule 8(2) of the Companies (Accounts) Rules 2014 in form AOC-2 isannexed to this report.
III. Deposits & Unclaimed Dividend :
Your Company has not accepted any public deposit under Chapter V of the Companies Act2013. During the year under review in terms of provisions of Investors Education andProtection Fund (Awareness and Protection of Investors) Rules 2014 unclaimed dividenddeclared by the Company for financial year 2008-09 aggregating to Rs.93546/- wastransferred to Investors Education and Protection Fund within the due date.
IV. Extract of Annual Return :
The Extract of Annual Return in Form MGT-9 as required under Section 92(3) of the Actread with Companies (Management & Administration) Rules 2014 is annexed to thisreport.
V. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
The Company has in place an Anti-Sexual Harassment Policy in line with the requirementsof The Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013. Internal Complaints Committee (ICC) has been set up to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary trainees) are covered under this policy. No complaints were received during theyear 2016-17.
VI. REGULATORY ORDERS:
No significant or material orders were passed by the regulators or courts or tribunalswhich impact the going concern status and Company's operations in future.
VII. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO:
Your Company is into the business of Broadcasting of General Entertainment TelevisionChannels. Since this business does not involve any manufacturing activity most of theinformation required to be provided under Section 134(3) (m)) of the Companies Act 2013read with the Companies (Accounts) Rules 2014 are Nil / Not Applicable.
However the information as applicable is given hereunder:
1. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO
Your Company is into the business of Broadcasting of General Entertainment TelevisionChannels. Since this business does not involve any manufacturing activity most of theinformation required to be provided under Section 134(3) (m)) of the Companies Act 2013read with the Companies (Accounts) Rules 2014 are Nil / Not Applicable. However theinformation as applicable is given hereunder:
a) CONSERVATION OF ENERGY
|(i) the steps taken or impact on conservation of energy ||Your Company being a service provider requires minimal energy consumption and every endeavour is made to ensure optimal use of energy avoid wastages and conserve energy as far as possible. |
|(ii) the steps taken by the company for utilizing alternatesources of energy || |
|(iii) the capital investment on energy conservation equipment || |
b) Technology Absorption:
|((i) the efforts made towards technology absorption || |
|(ii) the benefits derived like product improvement cost reductionproduct development or import substitution || |
|(iii) in case of imported technology (imported during the last threeyears reckoned from the beginning of the financial year)- ||Your Company uses latest technology and equipment's into its Broadcasting business. |
|(a) the details of technology imported. ||However since the Company is not engaged in any manufacturing the information in connection with technology absorption is Nil. |
|(b) the year of import; || |
|(c) whether the technology been fully absorbed. || |
|(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof. || |
|(iv) the expenditure incurred on Research and Development || |
c) Foreign Exchange Earnings and Outgo:
Particulars of foreign currency earnings and outgo during the year are given inAdditional Information to the financial statements forming part of Notes on Accounts ofthe company.
19. HUMAN RESOURCES & PARTICULARS OF EMPLOYEES
Being in the business of creativity and business of people to ensure sustainablebusiness growth and become future ready over the years your Company has been focusing onstrengthening its talent management and employee engagement processes and through theyear organisation's engagement scores has improved to highest percentile in theentertainment sector. Your Company had 528 employees as of March 31 2017 and your companyprovided additional employment opportunity to people and empowered the human resourceassets during the year. Requisite disclosures in terms of the provisions of Section 197(12) of the Act read with Rule 5 (2) and 5 (3) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 along with statement showing names andother particulars of the employees drawing remuneration in excess of the limits prescribedunder the said rules requires your company to disclose the particulars of employees whoare in receipt of remuneration of Rs. 60 lakhs or more per annum and those who were inreceipt of remuneration of Rs. 5 lakhs or mores per month. However during the financialyear under review company does not come under the purview of the above said complianceexcept Managing Director and Whole time Directors of the Company the disclosure is madein the annexure.
20. VIGIL MECHANISM AND WHISTLE BLOWER POLICY
Section 177 of the Companies Act 2013 requires every listed company and such class orclasses of companies as may be prescribed to establish a vigil mechanism for thedirectors and employees to report genuine concerns in such manner as may be prescribed.
The Company has adopted a Code of Conduct for Directors and Senior Management Personnel("the Code") which lays down the principles and standards that should governthe actions of the Directors and Senior Management Personnel.
Any actual or potential violation of the Code howsoever insignificant or perceived assuch is a matter of serious concern for the Company. Such a vigil mechanism shall providefor adequate safeguards against victimization of persons who use such mechanism and alsomake provision for direct access to the chairperson of the Audit Committee in appropriateor exceptional cases.
The company had established a mechanism called Whistle Blower Policy' foremployees to report to the management instances of unethical behaviour actual orsuspected fraud or violation of the company's code of conduct and the same is availableat the website of the company (www.rajtvnet.in).
The Company has laid down code of conduct for Board of Directors and senior managementpersonnel. Report details of establishment of vigil mechanism (for directors and employeesto report genuine concerns) pursuant to the provisions of section 177(9) & (10) of theCompanies Act 2013 and as per SEBI (LODR) 2015 of the Listing Agreement.
21. Disclosures in terms of the provisions of Section 197 (12) of the Act read withRule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 are provided in the annual report.
22. SHAREHOLDING OF DIRECTORS/PROMOTERS AND PROMOTER GROUP:
The Managing Director and other whole time Directors along with their spouse anddependent children constituting promoters and Promoter group hold more than two percent ofthe equity share of the Company in their individual capacity. Independent Directors do nothold any share in the Company.
23. INTERNAL FINANCAIL CONTROL
The company has an established internal control system on the -Financial reporting andthis is adequate for the size and nature of our business. The company's Internal ControlSystem is supported by well laid out systems procedures and policies for each of thefunctions and these are being followed in the normal course of operations of the Company.The adherence to the established procedures / policies is being audited by firm ofAuditors as part of the internal audit. Appropriate actions to correct deviations if anyare taken up immediately by the management. The Audit Committee of the Company providesreassurance to the Board on the existence of an effective internal control system in theoperations of the Company. The company has established a system of periodic review of theestablished internal control system and its effectiveness and takes actions for upgradingthe same to meet the changing requirements.
24. Pledging of the shares by the Promoters
As required under SEBI (Substantial Acquisition and Takeover) Regulations. 1997 thePromoters promoter Group and the persons acting in concert representing Promoters andpromoter Group pledged shares during the financial year. Details as per annexure II-IV(II)Details Pledging of the Shares by the Promoters
|Sl. No ||Particulars ||Year Ended March 31 2017 |
|A ||PARTICULARS OF SHAREHOLDING ||No. of shares |
|1 ||Promoters Share Holding || |
| ||- Number of Shares ||36554244 |
| ||- Percentage of Shareholding ||70.41 |
|2 ||Promoter and Promoter Group Shareholding || |
| ||a) Pledged / Encumbered || |
| ||Number of Shares ||2660000 |
| ||Percentage of Shares (as a % of total shareholding of promoter and promoter group) ||7.27 |
| ||Percentage of Shares (as a % of total share capital of the Company) ||5.12 |
| ||b) Non - Pledged / Non -Encumbered || |
| ||- Number of Shares ||33894244 |
| ||- Percentage of Shares (as a % of total shareholding of promoter and promoters group) ||92.73 |
| ||- Percentage of Shares (as a % of total share capital of the Company) ||65.29 |
| ||Total Promoter Holdings ||70.41 |
25. LISTING WITH STOCK EXCHANGES:
The Company confirms that it has paid the Annual Listing Fees for the year 2016-2017 toNSE & BSE where the Company's Shares are listed.
26. SHARES IN SUSPENSE ACCOUNTS:
As required under Requirements of the Listing Regulations 1 shareholder and 464numbers of outstanding shares are lying in the suspense account at the beginning and endof the year. The Company has not been approached by any of these shareholders. The votingrights on the shares outstanding in the suspense account as on March 31 2014 shall remainfrozen till the rightful owner of such shares claims the shares.
27. DIRECTORS' RESPONSIBILITY STATEMENT:
In pursuance of section 134 (5) of the Companies Act 2013 the Directors herebyconfirm that:
(a) In the preparation of the Financial Statements of the Company - comprising of theBalance Sheet as at March 31 2017 and the Statement of Profit & Loss for the yearended on that date have been prepared on a going concern basis following applicableaccounting standards and that no material departures have been made from the same;
(b) Accounting policies selected were applied consistently and the judgments andestimates related to these financial statements have been made on a prudent and reasonablebasis so as to give a true and fair view of the state of affairs of thethe Company as atMarch 31 2017 and of the profits/ (Loss) of the Company for the year ended on thatdate;
(c) Proper and sufficient care has been taken for maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 to safeguard theassets of the Company and to prevent and detect fraud and other irregularities.
(d) Requisite internal financial controls to be followed by the Company were laid downand that such internal financial controls are adequate and operating effectively; and
(e) Proper systems have been devised to ensure compliance with the provisions of allapplicable laws and such systems are adequate and are operating effectively.
The Directors take this opportunity to thank all their valued customers businessassociates and vendors for their kind support. The Directors also record theirappreciation for the sincere and dedicated efforts put in by all Employees. Employees areour vital and most valuable assets. Your Directors value the professionalism andcommitment of all employees of the Company and place on record their appreciation of thecontribution made by employees of the Company at all levels that has contributed to yourCompany's success and remain in the forefront of media and entertainment business. YourDirectors thank and express their gratitude for the support and co-operation received fromthe Central and State Governments / regulatory authorities viz. the Ministry ofInformation & Broadcasting the Department of Telecommunication Ministry of CorporateAffairs Reserve Bank of India Securities and Exchange Board of India Foreign InvestmentPromotion Board the Stock Exchanges and Depositories and other stakeholders includingviewers producers vendors financial institutions banks investors Service providersand all our stakeholders. Your directors also place on record their appreciation of thetireless efforts of Team RAJTV a dedicated and loyal band of people who have displayedunswerving commitment to their work in these challenging times and helped the Companydeliver good results.
| || ||For and on behalf of the Board of Directors |
| ||Sd/- ||Sd/- |
|Place : Chennai ||Raajhendhran. M ||Ravindran M |
|Date : 30.6.2017 ||Chairman & Managing Director ||Director |