Rolta India Limited
Your Directors are pleased to present the 27th Annual Report on the business &operations of your Company together with Audited Financial Statements & Auditor'sReport for the Financial Year ended 31st March 2017.
FINANCIAL HIGHLIGHTS & REVIEW OF PERFORMANCE
The Company's financial performance for the year ended 31st March 2017 issummarised below:
| || ||(Rs In Crore) |
| || |
| ||Financial year ended March 31st 2017 ||Financial year ended March 31st 2016 |
|Revenue || || |
|Sales of IT Solutions and Services ||3179.88 ||3799.59 |
|Other Income ||43.68 ||38.21 |
|Total Revenue ||3223.56 ||3837.80 |
|Expenses || || |
|Cost of Materials & Technical Subcontractors ||1329.61 ||1519.39 |
|Employee Benefit Expenses ||703.96 ||792.54 |
|Finance Costs ||562.08 ||478.02 |
|Depreciation and Amortization Expenses ||263.09 ||542.75 |
|Other Expenses ||191.66 ||285.17 |
|Exchange Difference Gain / (Loss) ||(5.34) ||74.10 |
|Total Expenses ||3045.06 ||3691.97 |
|Profit / (Loss) before Exceptional items and tax ||178.50 ||145.83 |
|Exceptional Items || || |
|Provision cum Write off of Debtors ||536.84 ||-- |
|Profit before Tax ||(358.34) ||145.83 |
|Tax expense / benefit ||525.08 ||37.96 |
|Profit / (Loss) for the year ||166.74 ||183.79 |
Results of Operations and the State of Company's Affairs
Ministry of Corporate Affairs (MCA) on February 16 2015 notified that IndianAccounting Standards (Ind-AS) are applicable to certain class of Companies from April 12016 with transition date of April 1 2015. Ind- AS has replaced the previous Indian GAAPprescribed under Section 133 of the Companies Act 2013 ("the Act") read withRule 7 of the Companies (Accounting) Rules 2014.
The reconciliation and effect of the transition from previous GAAP to Ind-AS have beenset out in Note No. 2(III) in the notes to account in the Standalone Financial Statementand Note No. 3 (III) in the notes to accounts in the Consolidated Financial Statement
During the year under review your Company has registered consolidated revenue forfinancial year ended March 31 2017 at Rs 3179.88 Crore against Rs 3799.59 Crore inprevious year registering a decrease in Year- on-Year growth of 16.31%. The totalConsolidated Earnings before interest tax depreciation and amortization (EBITDA) forfinancial year ended March 31 2017 is Rs 954.65 Crore against Rs 1202.49 Crore inprevious year registering a Year-on-Year decline of 20.61%. Consolidated profit after taxfor the financial year ended March 31 2017 is Rs 166.74 Crore as against Rs 183.79 Crorein previous year.
The basic Earnings Per Share after exceptional item and tax for the financial yearended March 312017 was Rs 10.21 as against previous period Rs 11.38. The basic EarningsPer Share was computed by considering the weighted average number of shares outstandingduring the period as per the provisions of 'Accounting Standard 20' notified under Section133 of the Companies Act 2013 read with Rule 7 of Companies (Accounts) Rule 2014.
The Company's consolidated net worth increased to Rs 2584.63 Crore as on March 312017 from Rs 2307.18 Crore in March 31 2016 reflecting the inherent strength of theCompany. The book value per share as on March 31 2017 is Rs 157.31 as against Rs 141.81at the end of March 31 2016.
The Financial performance on Standalone basis is as follows:
| || |
| ||Financial year ended March 31st 2017 ||Financial year ended March 31st 2016 |
|Revenue || || |
|Sales of IT Solutions and Services ||1454.91 ||1829.71 |
|Other Income ||13.52 ||47.35 |
|Total Revenue ||1468.43 ||1877.06 |
|Expenses || || |
|Cost of Materials & Technical Subcontractors ||374.20 ||141.48 |
|Employee Benefit Expenses ||137.73 ||216.34 |
|Finance Costs ||155.99 ||97.16 |
|Depreciation and Amortization Expenses ||95.01 ||471.09 |
|Other Expenses ||74.37 ||142.17 |
|Exchange Difference Gain / (Loss) ||(1134) ||78.96 |
|Total Expenses ||825.96 ||1147.20 |
|Profit / (Loss) Before Exceptional Items and Tax ||642.47 ||729.86 |
|Exceptional Items || || |
|Less : Provision cum Write off of Debtors ||536.84 ||- |
|Less : Loss on Transfer of Business ||- ||653.56 |
|Profit / (Loss) Before Tax ||105.63 ||76.30 |
|Tax Expenses ||(0.14) ||48.30 |
|Profit / (Loss) for the year ||105.49 ||124.60 |
The Company's standalone revenue was Rs 1454.91 Crore for the financial year endedMarch 31 2017 as against Rs 1829.71 Crore for the previous financial year ended March31 2016 representing 20.5% decrease. The Profit after tax for the financial year endedMarch 31 2017 is Rs 105.49 Crore as against Rs 124.60 Crore in the previous financialyear ended March 31 2016 after providing for exceptional item of loss on transfer ofbusiness amounting to Rs 653.56 Crore.
Rolta continues to incur significant expenses on a very prestigious and time bounddefense project which required considerable ongoing investment during the current yearalso. This coupled with certain other cyclical factors have resulted in non-payment ofinterest coupon on Bonds raised by US Subsidiary Companies. The Company's financial andlegal advisors have initiated discussions with their counterparts representing an ad hoccommittee composed of the largest bondholders to discuss potential appropriate solutionsto the present situation. The discussions are presently in progress. For furtherinformation bond holder may contact at Project_Rome_WorkingTeam_Int@moelis.com
BUSINESS OPERATIONS OVERVIEW AND OUTLOOK
The world of information technology is changing dramatically with the emergence ofdisruptive Digital technologies. Businesses today are no longer satisfied by automatingbusiness transactions but are looking for Business Outcomes to remain relevant and succeedin the Digital Economy. This revolution is being fueled by technologies such as the CloudMobility Enterprise / Cyber Security Internet of Things (IoT) and Big Data Analyticsamongst others. The nexus of these technologies and the pervasive hyper connected networksis responsible for the deluge of digital data and is posing major challenges toorganizations. With over 80% of digital data having a locational context adding ageospatial dimension is vital for deeper insights. Globally organizations cutting acrossIndustries are increasingly demanding Digital Transformation solutions to remain relevantand succeed in the Digital Economy.
Rolta has been charting a course to constantly transform itself to remain relevant inthe face of relentlessly changing digital technologies and market needs while remainingfocused on core competencies. The Company continues to make investments in developingdifferentiating intellectual property (IP) targeted to this growing demand for Digital
Transformation Solutions. Rolta with its rare combination of deep Geospatial andEngineering expertise combined with its IT prowess and differentiated IP based softwarepackages has established an enviable track record to help its customers on their DigitalTransformation in each of the areas it serves.
India Defence and Security
Rolta continues to be in a leadership position in the Indian Defence and Securitysoftware market of Command and Control (C2) & Intelligence Surveillance andReconnaissance (ISR) and assisting them to usher in their Digital Transformation. TheCompany's world class indigenously developed Military-of-the-Shelf (MOTS) IP has beendeployed and proven operationally across the country. Accordingly Rolta is consideredamongst a handful of highly accomplished companies that meet the stringent 'Make India'vision of the Government. Defence Procurement Procedure 2016 promulgated by the Ministryof Defense ("MoD") introduced the categorization of "IndigenouslyDesigned Developed and Manufactured (IDDM)" as most preferred category forprocurement to fulfil this vision. As a result Rolta is poised to greatly benefit due toits track record and investments in creating indigenous products and solutions for Indiandefence over last 20 years.
Today Rolta's C2 & ISR solutions are deployed in large number of locations of theIndian Army which are acting as great force multiplier for the National security. Roltahas now moved into the next generation technologies and possesses large number ofsolutions like Rolta Operational Planning (ROP) Software Suite Wargaming for ConventionalOps Aeronautical Information Based Flight Planner and AF Overall Planning System. Withits cutting edge technologies Rolta will continue to provide its stellar solutions tomeet the operational requirements of the three services.
Rolta is the only Company in India to have developed and released highly sophisticatedindigenous ISR software solutions that are used for assessing and interpreting troopmovements and enemy build up at forward locations to counter threats like insurgencyinfiltration etc. Rolta is uniquely poised to migrate these solutions to the nextgeneration 64 bit Rolta IP based ISR suite. Rolta's 64 bit next generation ISR INT andSituation awareness solution includes a ruggedized Laptop based implementation that hasthe ability to capture terrain & operational intelligence for decision makers atstrategic and operational levels of land sea and air forces. Powerful simulation featuresfacilitate INT acquisition planning
Battlefield Management System (BMS): The Battlefield Management System (BMS) aimed atushering in Digital Transformation of the Indian Army is one of the largest such programin the world. Ministry of Defence (MoD) has selected the exclusive consortium of BELBengaluru and Rolta as a Development Agency for the Battlefield Management System (BMS)project worth about Rs 70000 Crore.
The Battlefield Management System (BMS) is an ambitious Command & ControlCommunications Computing and Intelligence (C4I) project under the MoD's 'Make India'program. This project will usher digital transformation of the Indian Army's battlefieldoperations down to the fighting echelons operating at the forward edge of the TacticalBattle Area at the Battalion and Combat Group levels and below. The BMS solution providessituational awareness visualization and Decision Support with the aim of optimizing theoperational effectiveness of tactical units.
As a part of its consortium with BEL Rolta is responsible for the complete BMSapplication development and software licensing GIS software and services. Rolta will alsojointly work with BEL for manufacturing soldier SDR the overall system designintegration installation commissioning and maintenance of the BMS programme. The projectis progressing well and the BEL-Rolta Consortium has successfully crossed variousmilestones including the submission of the revised Detailed Project Report (DPR).
Communications: Rolta has successfully expanded its business into Military &Security Comms domain and offers a variety of world-class Communication products. InDefence communication domain Rolta has adopted a focused approach towards communicationsolutions based on Software Defined Radio (SDR). Besides addressing the Soldier SDR forBMS Rolta in partnership with world leaders has offered solutions for many high valueprojects and is under consideration for prestigious projects like SDR High Capacity RadioRelays and many more.
Defence Security: Rolta's indigenous Defence security solutions include world-classsolutions for Defence Security. Rolta continues to play a strong role in the DefenceSecurity market in India by providing a full range of solutions that cover Bordermanagement Critical military infrastructure protection Def Cyber security Coastalsecurity Vessel Traffic Management Solution(VTMS) Multi-agency integration and Emergencyresponse systems. Rolta's indigenous Defence security solutions which include fieldproven software like Rolta Command and Control and Rolta Crime Analytics havebeen recognized for the significant value they bring to security programs across thenation.
Defence Security & Analytics: Rolta has successfully harnessed GeoBI and big dataanalytics technologies for meeting the needs of Defence. Rolta solutions provide Machinelearning and Artificial Intelligence Predicative and prescriptive analytics which havebeen offered to address large number of important Defence projects.
Convergence and integration of Geospatial technology with various information systemsis playing a critical role in decision-making and problem solving across a wide spectrum.The most significant changes in the Geospatial world will not come from any one singletechnology but from a combination and an interplay between multiple technologies likeCloud Internet of Things Big Data Mobility Artificial Intelligence etc. Clearlyadding a geospatial dimension is vital for deeper insights considering 80% of digital datahas a locational context. Rolta has built end-to-end Geospatial capabilities enabling theorganization to create secure geospatial enabled digital repositories create interactiveportals for smart insightful and collaborative decision making with Geospatial Analyticsto drive business outcomes. Geospatial technology is a vital ingredient for any effectiveSmart City Solutions. Rolta has been successfully leveraging its Geospatial expertise andproven IP in the areas of Smart Cities and e-Governance. The Company has built an enviableportfolio for addressing a wide spectrum of Smart City requirements cutting acrossUtilities Transportation Environment Land Management Public Works Urban PlanningDisaster Management and Safety amongst others. These products typically provide intuitiveactionable insights by contextually integrating numerous agency-centric systems while alsooffering a visually rich means of collaboration and communication of spatial data. Roltahas deployed till date more than 400 geospatial enabled
Smart City projects in various parts of the world across Canada North America EuropeMiddle East and India.
Engineering Digital Information Management Systems
Asset intensive industries have realized the intrinsic value of their digital assetinformation and are demanding robust Engineering Information Management systems foreffective plant management. Rolta's unique ability to integrate its portfolio ofengineering solutions with enterprise- level IT has positioned the Company to address thisgrowing demand. Leveraging on its Engineering strengths Rolta has built an enviable trackrecord to help asset intensive industries in their quest for digital transformation bycombining deep industry domain knowledge and cross functional technical expertise. Withthe company's IP led automation and deep engineering expertise in Asset InformationManagement Solution Rolta has up till now successfully delivered hundreds of milliondollar projects in North America Middle East Japan and India. Rolta's Asset LifecycleManagement solutions are precursors to large digital transformation initiatives which manyindustries are adopting to address the problems of having accurate up-to-date data forsubsequent deeper analytics. This has helped Rolta to address multiple projects fordeveloping Intelligent Asset Information systems for refineries in India Middle East andthe UK.
Enterprise IT Cloud Mobility and Cyber Security Solutions
In this digital era organisations are increasingly embracing Mobility and theubiquitous Cloud computing for greater accessibility and flexibility customisation andintegration with their enterprise applications such as ERP and Web Portals. The movementof data outside the confines of the organisation's firewall is raising security issues andRolta has developed a tiered security approach covering cyber perimeter networkendpoint application and data security with a comprehensive portfolio of solutions andservices that exploits Rolta IP at all stages. Customers are increasingly looking for asingle vendor capable of designing delivering optimizing and subsequently managing theirEnterprise wide solutions. Rolta's focus in the area of Enterprise IT is to deliverend-to-end solutions whether for sophisticated BI and Big Data Analytics buildingspecialized Enterprise Applications customized for individual verticals Mobility or forcreating underlying sophisticated Cloud enabled IT Infrastructure.
IoT & Big Data Analytics:
Journalists today are comparing Digital Data in this 21st century as the new Oil.Organisations who recognize the fundamental value in this data and learn to extract itwill be able to reap the huge benefits. Rolta has developed a complete portfolio of BigData Analytics tailored to suit individual industry needs and is helping organisations totake data driven decisions instead of relying on intuition and gut feel.The Companyaddresses the full spectrum of IoT and Big Data analytics maturity journey coveringinitial advisory data discovery enablement of big data landscape establishing an assetinformation model (AIM) to secure IoT integration and culminating in advanced analytics.The flagship Rolta OneView Enterprise Suite is a unique Big Data Analytics solutionthat addresses the needs of enterprises to exploit the business value of Big Data. RoltaOneView leverages the company's patented technology for real-time IoT integration ofsensor data from disparate operations and business systems to offer cross functionalvisibility of all the critical business functions. Ongoing innovations such as AI DeepMachine Learning Data Lake and Predictive Analytics together with new features andfunctionality including embedded process integration and rules platform Data LakeEnterprise Asset Condition Monitoring 3D/4D Spatial visualizations Enterprise Search& collaboration ensure the product remains at the leading edge.
The maturity and exceptional value of Rolta's Products and Solutions are clearlyevident from the tremendous traction built by Rolta over the years with more than 100 BIand Big Data Analytics customers worldwide. This customer base includes several marqueeclients who have adopted Rolta's BI and Big Data Analytics Solution for their DigitalTransformation including 11 Fortune 500 companies and 2 Indian Navratnas. What is evenmore encouraging is that Rolta's BI and Big Data customers span across all the assetintensive industries served by the Company.
The Company's expanding portfolio of products and solutions together with the abilityto uniquely provide innovative Digital Transformation Solutions has resulted in theCompany becoming a market leader in the carefully selected areas of business in India anda recognized player in the global market. Rolta is being increasingly recognized byindustry analysts and technology leaders as a company that truly offers innovativebusiness solutions tailored for each of the verticals that Rolta serves. Various awardsand citations received by the Company are testimonials to Rolta's differentiated approach.Rolta today is uniquely leveraging the exceptional combination of IT Geospatial andEngineering domains addressing high growth Verticals with proven Rolta IP led solutionsbuilt around Rolta IP with 250+ copyrights/patents.
In order to conserve resources your Directors have not recommended any dividend forthe Financial Year ended March 31 2017. No amount has been transferred to reserve duringthe year.
The Company had transferred a sum of Rs 5753103/- during the financial year to theInvestor Education and Protection Fund established by the Central Government. The saidamount represents Unclaimed Dividend for the financial year 2008-2009 with the Company fora period of 7 years from the due date of payment.
The paid up equity share capital of the Company as on March 31 2017 was Rs1642713620 divided into 164271362 equity shares of Rs 10/- each. During the yearunder review the Company has allotted 1567266 equity shares of Rs 10/- under ESOP Planto the eligible employees of the Company and its subsidiaries. Further the Company hasnot issued shares with differential voting rights. The Company has not issued sweat equityshares and does not have any scheme to fund its employees to purchase the shares of theCompany.
EXTRACT OF THE ANNUAL RETURN
In terms of provisions of Section 92 (3) of the Companies Act 2013 read with Rule 12(1) of Companies (Management and Administration) Rules 2014 as amended extract of theAnnual Return in form No. MGT 9 are set out in Annexure D to the Board's Report.
NUMBER OF MEETINGS OF THE BOARD
A calendar of Meetings is prepared and circulated in advance to the Directors.Duringthe financial year ended March 31 2017 Eight (8) meetings of the Board were held with aminimum of one meeting in each quarter in a year and not more than one hundred and twentydays has intervened between two consecutive meetings of the Board. For details of themeetings of the Board please refer to the corporate governance report which forms partof this report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013the Company has established a Vigil Mechanism named Whistle Blower Policy (WBP) to providea formal mechanism to the directors and employees to report their genuine concerns aboutunethical behavior actual or suspected fraud or violation of the Company's Code ofConduct if any. The details of the WBP is explained in the Corporate Governance reportand also posted on the website of the Company.
RISK MANAGEMENT POLICY
The Company has adopted a Risk Management Policy in accordance with the provisions ofthe Companies Act 2013. The Company reviews the execution of Risk management plan andensures its effectiveness including identification evaluating monitoring and minimizingidentifiable risks.
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 (Listing Regulations) Board has carried out anannual evaluation of its own performance the directors individually as well as theevaluation of the working of its Committee(s) after seeking inputs from all the Directorsexcluding the Director being evaluated.The details of the Board evaluation is explained inthe Corporate Governance report which forms part of this report.
The Board has on the recommendation of the Nomination & Remuneration Committee(NRC) framed a policy for selection and appointment of Directors Top Management and theirremuneration. The Company's remuneration policy is driven by the success and performanceof the individual employee and the Company.
The key objective of this policy is to:
a) guide the Board in relation to appointment and removal of Directors Key ManagerialPersonnel and Top Management.
b) evaluate the performance of the members of the Board and provide necessary report tothe Board for further evaluation of the Board.
c) recommend to the Board on remuneration payable to the Directors Key ManagerialPersonnel and Top Management.
The authority to identify right candidates for the appointment of Top Management isvested with the Chairman & Managing Director. The Human Resource Department willfacilitate in identifying the candidates internally or externally. NRC will consider thecandidates proposed by the Chairman & Managing Director and recommend to the Board forits consideration and appointment in accordance with the applicable provisions of the Actand Rules.
COMPOSITION OF AUDIT COMMITTEE
Audit Committee of the Company has been constituted in line with the provisions ofRegulation 18 of Listing Regulations read with Section 177 of Companies Act 2013. Themembers of Audit Committee comprised of Ms. Homai A Daruwalla (Chairperson) Mr. K R ModiMr. Ramnath Pradeep and Mr. Ramakrishna Prabhu. More details of the Audit Committee aregiven in the Corporate Governance Report.
EMPLOYEES STOCK OPTION SCHEME
In accordance with the Employee Stock Option Scheme 2014 of the Company a total numberof 1050000 stock options were granted during the year by the Nomination &Remuneration Committee.
The particulars required under the SEBI (Employee Stock Option Scheme and EmployeeStock Purchase Scheme) Guidelines 1999 are annexed to and forms part of this report asAnnexure F. No employee was issued Stock Options during the year equal to or exceeding 1%of the issued capital of the Company at the time of grant.
PREVENTION OF INSIDER TRADING
The Company has formulated a policy for Prevention of Insider Trading with a view toregulate monitor and report trading by its employees and other connected persons incompliance with SEBI (Prohibition of Insider Trading) Regulations 2015 and the same hasbeen posted on the website of the Company.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134 (5) of the Companies Act 2013 the Board of Directors to thebest of their knowledge and ability confirm that:
(a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed and there are no material departures;
(b) they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year and of the profitand loss of the Company for that period;
(c) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
(d) they have prepared the annual accounts on a going concern basis; and
(e) they have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and were operating effectively.
(f) they have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
(i) Statutory Auditors
In the Annual General Meeting (AGM) held on August 20 2016 M/s. N M Raiji & Co.Chartered Accountants have been appointed Statutory Auditors of the Company for a periodof Four (4) years to hold office till the conclusion of the AGM to be held in the Calendaryear 2020 (subject to ratification by the members at every AGM).Accordingly M/s. N MRaiji & Co. Statutory Auditor of the Company holds office until the conclusion of theensuing Annual General Meeting.
The Company has received letter from M/s. N M Raiji & Co. Chartered Accountantsto the effect that their appointment if made would be within the prescribed limits underSection 139 of the Companies Act 2013 and that they are not disqualified from suchappointment in terms of Section 141 (3) (g) of the Companies Act 2013 & Rules madethereunder. In terms of requirements of Listing Regulations M/s. N M Raiji & Co.Chartered Accountants has confirmed that they hold a valid certificate issued by the PeerReview Board of the Institute of Chartered Accountants of India.Being eligible offerthemselves for appointment accordingly Board recommends ratification of appointment ofM/s. N M Raiji& Co. Chartered Accountants as Statutory Auditors of the Company tohold the office as such upto the conclusion of AGM to be held in the Calendar year 2018.
The Auditor's Report for the Financial Year ended March 31 2017 does not contain anyqualification reservation or adverse remark or disclaimer on the financials / operationsof the Company. The observations and comments given by Auditors in their Report readtogether with notes to Accounts are self-explanatory and hence do not call for any furthercomments under Section 134 of Companies Act 2013 and Rules made thereunder.
(ii) Secretarial Audit Report
In terms of Section 204 of the Companies Act 2013 and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Board of Directors of the Companyhad appointed M/s. Virendra Bhatt Practicing Company Secretary as Secretarial Auditor ofthe Company to undertake the Secretarial Audit of the Company for the financial year endedMarch 31 2017. The report of the said Secretarial Auditor is enclosed as Annexure E tothis report in form MR-3. The report is self-explanatory and do not call for any furthercomments.
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of the Company and its subsidiaries prepared inaccordance with Accounting Standard 21 notified under Section 133 Companies Act 2013 readwith Rule 7 of Companies (Accounts) Rule 2014 form part of the Annual Report and arereflected in the Consolidated Financial Statements of the Company.
As on March 31 2017 the Company has 3 Indian and 2 overseas wholly owned Subsidiariesand 11 step-down overseas subsidiaries. The Company has reorganized its various businessgroups considering emerging business opportunities in the arena of Digital Transformationand Data Analytics. The Company is charting a course to constantly transform itself inorder to remain relevant in the face of relentlessly changing digital technologies andmarket needs while still remaining focused on core competencies and transition fromServices to a predominantly IP led Solutions organization. This necessitated movingemployees within various business groups and subsidiary companies. In the process theCompany has transferred Big Data Analytics related employees along with certain assets andliabilities to Rolta BI & Big Data Analytics Private Ltd. (formerly known as RoltaOptronics and Communications Pvt. Ltd).
Section 136 of the Companies Act 2013 has exempted companies from attaching the annualreports and other particulars of its subsidiary Companies along with the annual report ofthe Company. Accordingly the Annual Reports of the subsidiaries are not attached withthis Annual Report. However statement containing salient features of financial statementsof subsidiaries as per 129 (3) of the Act is also included in this Annual Report in formAOC-1 as Annexure A.The financial statements of the subsidiary companies are available forinspection of the shareholders at the Registered Office of the Company during the workinghours.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
None of the transaction with related parties falls under the scope of Section 188(1) ofthe Act. Information on transaction with related parties pursuant to Section 134(3) (h) ofthe Act read with rule 8(2) of the Companies (Accounts) Rules 2014 are given in AnnexureB in form AOC-2 and the same forms part of this report.
MATERIAL CHANGES AND COMMITMENTS IF ANY
Your Company does not have any material changes and commitments affecting the financialposition of the company which have occurred between the end of the financial year of thecompany to which the financial statements relate and the date of the report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Details of Loans Guarantees and investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statements.
During the Financial Year ended March 31 2017 the Company has not accepted anydeposits falling within the ambit of Section 73 of the Companies Act 2013 and TheCompanies (Acceptance of Deposits) Rules 2014.
INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY
Your Company has an adequate system of internal financial control commensurate with itssize and nature of business. Your Company has adopted policies and procedures for ensuringthe orderly and efficient conduct of its business including adherence to company'spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTIONPROHIBITION & 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. Corporate Harmony Committee (CHC) has been set up to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary trainees) are covered under this policy. The policy has been uploaded on thewebsite of the Company.
The earlier appointment of Mr. Kamal K. Singh as Executive Chairman & ManagingDirector (CMD) of the Company for a period of 5 years expired on June 30 2017.
In view of his outstanding excellent and invaluable services to the Company the Boardat its meeting held on May 30 2017 re-appointed Mr. Kamal K. Singh as Executive Chairman& Managing Director of the Company for a period of five years from July 12017 toJune 30 2022. Mr. Kamal K Singh will attain the age of 70 years during the extendedtenure of five years and hence the proposed appointment requires the approval of membersby way of a special resolution in terms of Section 196(3) of the Companies Act 2013.Accordingly Board proposes to extend his appointment for another period of 5 yearssubject to the approval of the members of the Company at the ensuing Annual GeneralMeeting
Mr. K R Modi Non-executive Independent Director of the Company was appointed for 3(three) consecutive years on September 27 2014 whose term expires in 2017. In terms ofSection 150 of the Companies Act 2013 Mr. K R Modi being eligible offers himself forre-appointment by the members. In the opinion of the Board Mr. K R Modi fulfills theconditions specified in the Companies Act 2013 for such re-appointment. Hisre-appointment is proposed for another term of three years.
During the year under review all Non- executive Independent Directors have givendeclarations that they meet the criteria of independence as laid down under Section 149(6)of the Companies Act 2013 and Regulation 16(1) (b) of the Securities and Exchange Boardof India (Listing Obligations And Disclosure Requirements) Regulations 2015.
Retirement by rotation
Pursuant to Section 149 152 and other applicable provisions of the Companies Act2013 one-third of such of the Directors as are liable to retire by rotation shall retireevery year and if eligible offer themselves for re-appointment at every AGM. Mr Kamal KSingh Chairman and Managing Director (in terms of Article 111 (b) of the Articles ofAssociation) and Mr. K R Modi Ms. Homai A Daruwalla Mr. Ramnath Pradeep Lt. Gen. PadamPal Singh Bhandari (Retd) being Independent Directors are not liable to retire byrotation. Mr. Rajesh Ramachandran Lt. Gen. K T Parnaik (Retd.) and Mr. Ramakrishna Prabhubeing Executive Directors are directors appointed liable to retire by rotation. Mr.Ramakrishna Prabhu Director will retire by rotation at the ensuing AGM and beingeligible offer himself for re-appointment in accordance with provisions of the CompaniesAct 2013.
CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVES
The brief outline of the Corporate Social Responsibility (CSR) Policy of the Companyand the initiatives undertaken by the Company on CSR activities during the year are setout in Annexure H of this report in the format prescribed in the Companies (CorporateSocial Responsibility Policy) Rules 2014. The policy is available on the website of theCompany.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo prescribed under Section 134 (3) (m) of the Companies Act 2013 readwith Rule 8 of the Companies (Accounts) Rules 2014 is Annexed as Annexure G to thisreport.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The ratio of the remuneration of each director to the median employee's remunerationand other details in terms of sub-section 12 of Section 197 of the Companies Act 2013read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are forming part of this report as Annexure C.
In terms of the provisions of Section 197(12) of the Companies Act 2013 read withRules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 a statement showing the names and other particulars of theemployees drawing remuneration in excess of the limits set out in the said Rules areprovided in the Annexure forming part of the Annual Report. However having regard to theprovisions of Section 136(1) read with its relevant proviso of the Companies Act 2013the Annual Report excluding the aforesaid information is being sent to the members of theCompany. The said information is available for inspection at the Registered Office of theCompany during working hours and any member interested in obtaining such information maywrite to the Company Secretary and the same will be furnished without any fee.
ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS
During the Financial Year ended March 31 2017 no regulator or court or tribunal haspassed any significant and material order which is impacting the going concern status andcompany's operations in future.
CORPORATE GOVERNANCE REPORT
The report on Corporate Governance as stipulated under the Listing Agreement forms anintegral part of this Report. The requisite certificate from the Secretarial Auditor ofthe Company confirming compliance with the conditions of corporate governance is attachedto the report on Corporate Governance.
At Rolta we consider human capital as its biggest strength and endeavor to attract thebest talent from across the industry. Rolta believes that motivated employees give theirbest hence Company's efforts are to provide a world class work environment throughflexible policies and processes.
Rolta understands the importance of work-life balance career advancement learning andgrowth opportunities for all its employees. Rolta has adopted flexi work timings andinnovative rewards and recognition schemes to enable ROLTAites to deliver their best andtake care of their personal commitments as well.
Rolta cares for its employees the annual health checkup and in house medical centremedical health insurance for employee & its family cafeteria services etc. are fewof the positive step towards this philosophy. Rolta believes in creating an empowered workculture and we also continue to be amongst the best pay masters in the industry.
Rolta believes that its work force is its non-replaceable resource hence continuouslyinvests in its people to maintain competitive advantage in the market place it achievesso by providing avenues for learning and development through various training programs andpolicies.
The Board of Directors wishes to express its sincere appreciation and thanks to allcustomers suppliers banks financial institutions solicitors advisors Government ofIndia concerned State Governments and other authorities for their consistent support andco-operation for its success.
Your Directors appreciate contribution made by the employees of the Company andacknowledge their hard work and dedication in ensuring that the Company consistentlyperforms well.
For an on behalf of the Board of Directors
| ||Kamal K Singh |
| ||Chairman & Managing Director |
| ||Mumbai |
| ||August 14 2017 |