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Sahara One Media and Entertainment Ltd.

BSE: 503691 Sector: Media
NSE: N.A. ISIN Code: INE479B01016
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OPEN 64.50
CLOSE 64.55
VOLUME 25
52-Week high 92.00
52-Week low 37.50
P/E
Mkt Cap.(Rs cr) 139
Buy Price 0.00
Buy Qty 0.00
Sell Price 64.50
Sell Qty 9.00

Sahara One Media and Entertainment Ltd. (SAHARAONEMEDIA) - Director Report

Company director report

To the Members

Your Directors are submitting the Thirty Fifth Annual Report of the Company togetherwith the Audited Statement of Accounts for the year ended 31st March 2016.

FINANCIAL / OPERATIONAL RESULTS

FOR THE YEAR ENDED Year ended 31.03.2016 Year ended 31.03.2015
(Rs.in million) (Rs.in million)
Total Income 50.865 290.517
Total expenses 347.253 583.145
Profit Before tax -296.38 -292.68
Provision for taxation - 36.303
(Current Deferred earlier year tax and others)
Prior Period income/ (expenses) 0.187 0.282
Surplus after tax and extraordinary items for the Year -296.575 -329.213
Surplus carried to the Balance Sheet - 315.234

THE YEAR UNDER REVIEW:

During the year under review the company has incurred Net Loss of Rs 296.575 millionas against loss of Rs. 329.213 million during last fiscal 2014-2015.

DIVIDEND

With a view to conserve resources with the company the Board of Directors has decidednot to recommend any dividend for the financial year 2015- 2016.

CAPITAL ISSUE

Company has not made any issue of Shares during the reporting period; hence the EquityCapital of the Company stands the same at Rs. 215250000/-.

SAHARA ONE

Sahara One is Sahara One Media and Entertainment Limited’s flagship brand in theGEC space in India and is a 24-hour Hindi entertainment channel. It offers its viewers acolorful and vast spectrum of emotions through its wide range of programming. We believeSahara TV is dedicated to promoting ‘Cohesive viewing’ through programmes like‘Jai Jai Jai Bajrangbali’ ‘Jhilmil Sitaron Ka Aangan Hoga’‘Rishton Ke Bhanwar Mein Uljhi… Niyati- season 2’ ‘Ghar AajaPardesi’ ‘Haunted Nights’ ‘Piya Ka Ghar’ & ‘Tujh SangPreet Lagayi Sajna’ we launched 2 new shows ‘Akhir Bahu Bhu Toh Beti HiHai’ & ‘Firangi Bahu’.

With a strong focus on quality content and innovative programming and promotionsSahara One Television is poised for a position of strength amongst the mainstream HindiGeneral Entertainment Channels in India. ‘Jai Jai Jai Bajrangbali’ from thehouse of Sagars is one of the most popular shows of our channel. The growing popularity ofthis mythological show has shown an increasing trend with the show delivering goodratings. Revamped ‘Rishton Ke Bhanwar Mein Uljhi… Niyati’ ‘JhilmilSitaron Ka Aangan Hoga’ & ‘Ghar Aaja Pardesi’ continues to enticeviewers with focus on family drama.

KISMAT CONNECTION - SUNDEEP KOACHAR KE SAATH

‘Kismat Connection’ is the first Indian astrological fiction show based onreal life stories. This show will not only educate people about astrology but also erasethe superstitions related to Astrological norms that currently exist. Astrology in Indiahas many versions varying according to different regions being a diversified country.Hence we bring you the very well known Astrologer ‘Sundeep Koachar’ who willhost this show as well as change the definition of Astrology which is more like a sciencethan a superstition. He will orate the meaning of Astrology as a science which if read inthe right way can depict the reasons for happenings in an individual’s life and howit can be a way of life if accepted the way it actually is. The format of the show wouldbe five episodes that would denote one story. And every week there would be new incidentsand new dimensions of astrology that will be explored in the show.

NEW PACKAGING AND CONTENT REVISED:

Sahara One will be seeing a total revamp as far as the look is concerned from the 7thof July. The entire packaging and color combination has been revised except for thesignificant logo. Shows are going through a dramatic content change to keep the viewershooked and in future new improved good quality shows are planned.

FILMY

The group is committed towards family entertainment in Bollywood cinema space. Filmycontinues to fascinate the film buffs of India with variety of films library ranging fromcomedy romance action and thrillers romantic and patriotic films.

The coming year will see some changes in the packaging of the channel. Besides this wealso plan to launch new interstitials to help our viewers relish the taste of world classentertainment content in films genre. Our library includes famous films like Ragini MMSGair Devdas Indra-The Tiger Darna Jaruri Hai Mangal Pandey Kabhi Haan Kabhi Na Dum Maro Dum Shadi Number1 Tum Mile and many more ...way forward Wake up Sid MusafirEk Duje Ke Liye Kaminey Jodha Akbar Delhi 6 Dil Chata Hai and many more. ‘MereBhains Ko Anda kyo Mara’ is an iconic humorous show which makes the audiences laughand brings them back to the channel again and again. Filmy besides adding value to theentire bouquet of TV channels is also a force which backs up the sales team adding to theGross revenue.

FIRANGI

The channel was launched on DD Direct (Doordarshan DTH Service) and select private DTHservices making it available to newer viewers on an all India basis. The channel offersdubbed international shows and dubbed world movies at present. The channel is in theprocess of transformation- it will be a free to air channel in the GEC genre available onanalog cable.

Bollywood music content has formidable impact on its consumers. India has gatheredrecent success stories in the form of television and radio content around retro music thisis going to be India’s first scientifically designed retro music channel that is trueto its format. The channel intends to cater to retro music lovers their favorite Bollywoodmusic 24 x 7… With almost 46% of total population of India with age 25 and aboveRetro market has strong available viewers and we are planning to get their attention bygiving them properly designed Retro music channel.

SAHARA MOTION PICTURES

Sahara Motion Pictures (SMP) has been known for producing big budget movies fromcommercially acclaimed directors like Ram Gopal Verma Anees Bazmee and Priyadarshan andat the same time supporting the cause of good cinema with films directed by criticallyacclaimed directors like Shyam Benegal Madhur Bhandarkar and Nagesh Kukunoor. While thefirst has lead to box office hits like ‘No Entry’ ‘Wanted’ and‘Malamaal Weekly’ the second has lead to the movies receiving the highestrecognition in Indian Cinema with 5 national Awards for Shyam Benegal’s ‘Bose -The Forgotten hero’ and Madhur Bhandarkar’s ‘Page 3’.

The year was focused on sourcing and developing new scripts and building a bettercreative bank. Preproduction work started on the sequel of "No Entry" as SalmanKhan’s has allotted dates from mid 2014.

Films slated to release in 2015- 2016 are:

• The Loving Doll: Directed by Pavan Kaul. Starring: Diana Hayden Karan SinghGrover Kitu Gidwani.

• It’s My Life: Directed by Anees Bazmi. Starring: Harman Baweja GeneliaD’Souza.

• Mumbai Cutting: 11 esteemed Directors like Anurag Kashyap Kundan Shah andSudhir Mishra come together to present a collection of 11 short films. Starring Raima SenSoha Ali Khan Jimmy Shergil and others

• Coffee Shop: A romantic film with a story showing that a lot can happen over acup of coffee.

• Bhopal

As of July 2013 SMP has finished shoot of their first in-house production and currentlythe post production work is on and is tentatively titled ‘The Loving Doll’ -ahorror film based on a strong relationship bond. The way forward being stories with‘wholesome entertainment’ SMP aims towards sustaining the title of atrustworthy and bankable banner in the field of movie entertainment.

The slate of films being worked upon in 2014- 2015 are:

Movie Cast Director Production
No Entry 2 Anil Kapoor Salman Anees Bazmee In association with BSK
Khan Fardeen Khan & Entertainment
10 Actresses

DIRECTORS:

Shri O. P. Srivastava Director of the Company is retiring by rotation and is eligiblefor re-appointment in accordance with the provisions of Section 152 of the Companies Act2013 and Article 89 of Company’s Articles of Association. Hence the Board recommendsname of Shri O. P. Srivastava for re-appointment as Director of the Company in the ensuingAnnual General Meeting who will be liable to retire by rotation. Smt Rana Zia has beenappointed as Whole Time Director of the Company under Section 196 197 and 203 of theCompanies Act 2013 read with Schedule V to the Companies Act for a period of 14.11.2015to 13.11.2020 subject to approval of Shareholders at ensuing Annual General Meeting of theCompany. The Board also recommends the name of Smt Rana Zia as Whole Time Director in thenotice of ensuing Annual General Meeting for passing of resolution by shareholders of theCompany and the resolution proposing her appointment as the Whole Time Director forms partof the Notice of the Annual General Meeting.

Shri Boney Surinder Kapoor has resigned as Director of the Company w.e.f. 14.11.2015.

INDEPENDENT DIRECTORS:

Shri R.S Rathore Shri J.N Roy and Shri Brijendra Sahay the IndependentDirectors of the Company have submitted the Declaration of Independence as requiredpursuant to Section 149 (7) of the Companies Act 2013 stating that they meet thecriteria of Independence as provided in Sub –Section 149(6) and Regulation 16 of theSEBI (Listing Obligations and Disclosure Requirements) Regulations2015.

The Company arranged familiarisation programmes for the Independent Directors.Independent Directors have already been informed about their duties rightsresponsibilities and Code of Conduct including various recent changes of the CompaniesAct 2013 in the Board Meeting of the Company. The details of familiarisation program forIndependent Directors are available on the website of the Company at-www. sahara-one.com

AUDIT COMMITTEE:

The Board of Directors of the Company constituted a committee of Directors (inCompliance with Regulations 18 of the SEBI Listing Obligation and Disclosure RequirementRegulations) known as Audit Committee in its meeting held on 30th January 2001and further re-constituted the same on 29th June 2002 29th July2006 29th April 2008 30th June 2009 2nd August 2011and 8th February 2012. Shri R. S. Rathore is continuing as Chairman of theAudit Committee since 10th March 2008. At present the Company has fourDirectors as members of Audit Committee viz. Shri R. S. Rathore Shri O.P. SrivastavaShri Brijendra Sahay and Shri J. N. Roy and Company Secretary acts as Secretary to theCommittee. Out of four committee members three are Independent Directors and one isPromoter Director. The Chairman of the Audit Committee is an independent Director which isin Compliance with the Regulations 18 of the Listing Obligation and Disclosure RequirementRegulations as well as Section 177 of the Companies Act 2013.

NOMINATION AND REMUNERATION COMMITTEE:

The Board of Directors of the Company constituted a committee of Directors known asRemuneration Committee in its meeting held on 26th August 2009 (pursuant tothe requirement of Schedule XIII of Companies Act 1956) to deal with matters related tomanagerial remuneration of company as may be required from time to time. The Committee wasre-named as "Nomination and Remuneration Committee" pursuant to Section 178 ofthe Companies Act 2013 by the Board at its meeting held on 11th August 2014.The Committee consists of following members at present:

Shri R. S. Rathore Chairman
Shri O.P. Srivastava Member
Shri Brijendra Sahay Member
Shri J. N. Roy Member

During the year under review meetings of the Nomination and Remuneration Committee ofthe Company were held on 14th November 2015 and 14th February2016.

STAKEHOLDERS RELATIONSHIP COMMITTEE:

The Board of Directors of Company had constituted Share Transfer Committee on 10thMarch 2000 which was later renamed as Shareholders and Investors Grievances Committeewhich was further renamed as Stakeholders Relationship Committee as pursuant to Section178 of the Companies Act 2013 and was further re-constituted on 3rd April2001 30th January 2002 29th July 2006 23rd October2008 21st March 2009 24th March 2010 and 8th November2012.

Following are the members of the committee at present:

Shri O.P. Srivastava Chairman
Shri Brijendra Sahay Member
Shri J. N. Roy Member

Shri Sukhmendra Kumar Company Secretary acts as Secretary / Convener of the committee.During the period under review the Company has not received any complaint from theShareholders/ Investors. No Meetings of Stakeholders Relationship Committee of the Companywere held during the financial year 2015-2016.

The Stakeholders Relationship Committee Meetings are held whenever required in case thegrievances of investors stand unresolved by the Registrar and Share Transfer Agent ofcompany M/s Link Intime India Pvt. Ltd.

CORPORATE GOVERNANCE

The Company has complied with the Corporate Governance Requirements as stipulatedunder the various regulations of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and the Companies Act 2013. A report on Corporate Governance along withCertificate on its Compliance forms a part of the Annual Report.

VIGIL MECHANISM / WHISTLE BLOWER POLICY:

The details of the vigil mechanism are mentioned in the Corporate Governance Report andalso available at investors@saharaone.com

CORPORATE SOCIAL RESPONSIBILITY:

The provisions of Section 135 of the Companies Act 2013 relating to Corporate SocialResponsibility are not applicable to the Company.

NOMINATION AND REMUNERATION POLICY

The Company has adopted a Nomination & Remuneration Policy attached as Annexure-1to this Report.

EXTRACT OF ANNUAL RETURN:

The information required under Section 134 of the Companies Act 2013 read with Rule 12of the Companies (Management and Administration) Rules 2014 the extracts of AnnualReturn of the Company in prescribed format is annexed herewith marked as Annexure 2 tothis Report

PERSONNEL:

Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are provided in the prescribed format and annexedherewith marked as Annexure to this Report. The statement containing particulars ofemployees as required under Section 197(12) of the Act read with Rule 5(2)and 5(3) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is providedin a separate annexure forming part of this report. Further the Report and the accountsare being sent to the members excluding the aforesaid Annexure 3. In terms of Section 136of the Act the said annexure is open for inspection at the Registered Office of theCompany.

RELATED PARTY TRANSACTIONS

The details of transactions entered into with the Related Parties during the year2015-16 are enclosed as Annexure 4.

PARTICULARS OF LOANS INVESTMENTS GUARANTEES AND SECURITY PROVIDED

Details of loans guarantees investments and security provided pursuant to theprovisions of Section 186 of the Companies Act 2013 are provided in notes forming partof the financial statements.

BOARD EVALUATION:

Pursuant to the provisions of the Companies Act 2013 and Regulation of the ListingAgreement the Board has carried out the annual performance evaluation of its ownperformance the Directors individually as well as the evaluation of its committees. Theperformance of individual directors was evaluated on parameters such as level ofengagement and contribution independence of judgement safeguarding the interest of theCompany and its minority shareholders time devoted etc.

ADEQUACY OF INTERNAL FINANCIAL CONTROL

Your Company Internal Financial Control System are Commensurate with the nature sizeand complexity of the Business and Operations. They are routinely tested and certified byInternal Auditors. Significant Audit Observation and the Follow up actions are reported tothe Audit Committee.

STATUTORY AUDITORS:

M/s D. S. Shukla & Co. Chartered Accountants Mumbai were appointed as theStatutory Auditors of the Company for a period of five years since end of the AnnualGeneral Meeting of the Company held on 26th September 2014 subject toratification by Shareholders at each Annual General Meeting to be held hereafter. In viewof this the matter is being placed before the members to consider the ratification ofappointment of M/s D. S. Shukla & Co. as Statutory Auditors of the Company as perrecommendation of the Board of Directors of the Company.

AUDITORS’ REPORT:

M/s D. S. Shukla & Co. Statutory Auditors submitted their Audit Report for theFinancial Year 2015-2016. The auditor has qualified the following points the reply ofmanagement to which is as under:

1. An Amount of Rupees 704272243/- is outstanding as recoverable from debtorsand continuing beyond stipulated period of recovery. The management based on internalassessments and evaluations have represented that these debtors amount are fullyrecoverable and no provision is necessary as at balance sheet date. However in absence ofany convincing evidence we are of the opinion that this amount should be considered asdoubtful and requires appropriate provisioning.

Our Reply

The Company has extended credit from time to time as per the market practice andregular follow up is being done to recover the same and the management is confident torecover the same. Hence no provision made by the management.

2. Amount of Rupees 578882469/- is outstanding which comprises of advancestowards purchase/production of films. The management has explained that such advances havebeen given in the normal course of business and are fully recoverable. However in ouropinion amount is doubtful of recovery as these are outstanding/remained unadjusted forlong period of time. Further balance confirmations from these parties have also not beenprovided to us.

Our Reply

For Amount of Rupees 578882469/- which comprises of advances towardspurchase/production of films given to S.K. Enterprises a legal notice has been issued forthe same on 30th May 2016 and regular follow up of the same is being done by theManagement officials and Company is confident of recovering the same amount with interesthence no provisioning required

3. Reference is invited to Note 30 to the financial statements regarding depositof Rupees. 694027883/- to Sahara-SEBI Refund account in the matter of dispute inrespect of repayment of Optionally Fully Convertible Debentures (OFCDs) by two groupcompanies namely M/s Sahara India Real Corporation Limited & Sahara HousingInvestment Corporation Limited the Hon’ble Supreme Court of India vide its orderdated 21-11-2013 had directed that Sahara Group of Companies shall not part with movableand immovable properties and accordingly Security and Exchange Board of India (SEBI) hasseized the company’s Fixed Deposit and Non Current Investment. Subsequent to thisHon’ble Supreme Court vide it’s order dated 4th June 2014 has directed todefreeze the Fixed Deposit account of the company subject to condition that total proceedswould be transferred to special account opened by the SEBI. However we are unable toascertain whether this amount is fully recoverable or not and its further impact if anythat may arise in case if this amount is subsequently determined to be doubtful ofrecovery.

Our Reply

Pursuant to the order of Hon;ble Supreme Court of India Rupees. 694027883/- has beentransferred to Sahara-SEBI Refund account though the Company is not related in any waywith the dispute. The matter is subjudice in Supreme Court and Management is fullyconfident that amount is fully recoverable hence no provisioning required. As the Companyis not in any way involved in litigations the management is fully confident that amounttransferred by order of Hon;ble Supreme Court of India will be refunded back once thefinal order is being passed by Hon’ble Supreme Court of India

DETAILS OF BOARD MEETINGS

During the financial year under review Four meetings of the Board of Directors wereheld details of which have been provided in the Corporate Governance Report.

SECRETARIAL AUDITORS:

Pursuant to the provisions of Section 204 of the Companies Act 2013 the Board hasappointed M/s C.P Shukla & Co. Company Secretaries Lucknow a firm of CompanySecretaries in Practice to conduct Secretarial Audit of the Company for the financialyear 2015-16. The Secretarial Audit Report for the financial year ended March 31 2016 isannexed herewith marked as Annexure 5 to this Report.

PUBLIC DEPOSITS:

The Company has not accepted any public deposit during the year under review.

PARTICULARS REQUIRED UNDER COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF THEBOARD OF DIRECTORS) RULES 1988:

Information required to be provided under Section 134(3) of the Companies Act 2013read with the Companies (Disclosure of Particulars in the Report of the Board ofDirectors) Rules 1988 in relation to Conservation of energy and technology absorption arecurrently not applicable to the Company. Particulars of foreign currency earnings andoutgo during the year are given as hereunder: Foreign Currency Earnings (Accrual Basis)- Rs. 36618 Foreign Currency Expenditures (Accrual Basis) - Rs. Nil

CORPORATE GOVERNANCE:

Corporate Governance Guidelines as specified in the Listing Agreement with StockExchanges is applicable to the Company from the Financial Year 2001-02. The Company hascomplied with the Guidelines of Corporate Governance and a separate report on theCorporate Governance is forming part of this Annual Report. A Certificate by PracticingCompany Secretary on the Compliance with the guidelines of the Listing Agreement on theCorporate Governance is forming part of this Annual Report.

DIRECTORS’ RESPONSIBILITY STATEMENT:

Pursuant to Section 134(3) (c) of the Companies Act 2013 the Directors based on therepresentation received from the operating management confirm that:-(a) in thepreparation of the Annual Accounts the applicable accounting standards had been followedalongwith proper explanation relating to material departures if any and there is nomaterial departure from following the accounting Standards.

(b) they have in selection of accounting policies consulted the Statutory Auditorsand have applied them consistently and made judgment and estimates that are reasonable andprudent so as to give true and fair view of the state of affairs of the Company as at theend of the Financial Year and of the Profit or Loss of the Company for that period.

(c) they have taken proper and sufficient care to the best of their knowledge andability for the maintenance of adequate accounting records in accordance with theprovisions of the Companies Act 2013 for safeguarding the assets of the Company andpreventing 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 had devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.

GENERAL

There have been no material changes and commitments which can affect the financialposition of the Company between the end of the financial year and the date of this Report.

Statutory Auditors of the Company have not reported any incident related to fraudduring the financial year 2015-16 to the Audit Committee or Board of Directors undersection 143(12) of the Companies Act 2013.

ACKNOWLEDGEMENTS:

Your Directors acknowledge with thanks the support and co-operation extended by theInvestors Bankers Business Associates and employees at all levels for their valuablepatronage.

For and on behalf of the Board of Directors of

Sahara One Media and Entertainment Limited

O. P. Srivastava Rana Zia
(Director) (Whole Time Director)
DIN-00144000 DIN-07083262
Place: New Delhi
Date: 13th August 2016