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Tanla Solutions Ltd.

BSE: 532790 Sector: IT
NSE: TANLA ISIN Code: INE483C01032
BSE 16:01 | 22 May 30.45 -1.00
(-3.18%)
OPEN

31.00

HIGH

32.80

LOW

29.90

NSE 15:31 | 22 May 30.70 -0.65
(-2.07%)
OPEN

30.50

HIGH

31.95

LOW

29.80

OPEN 31.00
PREVIOUS CLOSE 31.45
VOLUME 85162
52-Week high 53.80
52-Week low 28.85
P/E 26.25
Mkt Cap.(Rs cr) 342
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 31.00
CLOSE 31.45
VOLUME 85162
52-Week high 53.80
52-Week low 28.85
P/E 26.25
Mkt Cap.(Rs cr) 342
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Tanla Solutions Ltd. (TANLA) - Director Report

Company director report

TANLA SOLUTIONS LIMITED ANNUAL REPORT 2011-2012 DIRECTOR'S REPORT Dear Members, Our Directors have pleasure in presenting the 16th Directors' Report on the business and operations of our Company for the financial year ended on March 31, 2012. 1. Results of Operations in Rs. Financial performance of the Company (Standalone): Results Results Particulars March 31, 2012 March 31, 2011 Income from operations 368328675 287050801 Operating Profit (EBIDTA) (6572494) 54547723 Less: Depreciation & amortisation 139347846 312172843 Operating Profit before Tax (145920339) (257625120) Add: Other Income 4918636 5340458 Profit Before Tax (141001703) (252284661) Less: Provision for Tax (35127709) (73793030) Profit after Tax (105873994) (178491631) Dividend (incl. dividend tax) - 11833408 Transfer to General Reserve - - Net Profit Transferred to Reserves (105873994) (190325039) Earnings per share: Basic/Diluted (Rs.1 each) (1.04) (1.76) Dividend Rate Nil 10% Share Capital 101479593 101479593 Reserves & Surplus 6164224834 6270098828 Total shareholders funds 6265704427 6371578421 Book value per share (Rs.1 each) 61.74 62.79 2. Further Issue Of Equity Shares On Preferential Basis The company has not issued Equity Shares on Preferential basis during the financial year 2011-12. 3. Public Deposits The Company has not accepted any deposits within the meaning of Section 58A of the Companies Act, 1956 and the rules made there under during the financial year under review. 4. Directors In accordance with the provisions of the Companies Act, 1956 and Articles of Association of the Company, three Directors retire by rotation at the forthcoming Annual General Meeting and being eligible, offer themselves for re-appointment. A brief resume of the Directors seeking re-appointment is annexed to the Notice. Details of Directors who resigned after the previous AGM till the date of this Report: 1. Mr. Surjeet Kumar Palhan, Independent Director resigned from the Board on September 30, 2011 after serving the Board since July 18, 2007. 2. Mr. Amit Gupta, Director Finance, resigned from the Board on November 01, 2011 after serving the Board since November 11 ,2005. 3. Mr. Anoop Roy Kundal, Director - Operations, resigned from the Board on December 30, 2011 after serving the Board since October 27, 2004. 4. Mr. Navnit Chachan, Director & Chief Operating Officer, resigned from the Board on June 30, 2012 after serving the Board since November 11, 2005. 5. Mr. Shrikanth Madan Chitnis, Independent Director resigned from the Board on August 14, 2012 after serving the Board since December 28, 2005. The Board placed on record appreciation for the services rendered by the Directors during their tenure on the Board. 5. Management Discussion and Analysis A separate Management Discussion and Analysis Report is also attached and forms part of this report. 6. Subsidiaries The subsidiaries of the Company are: 1. Mufithumb Entertainment Private Limited 2. Tanla Mobile Private Limited 3. Tanla Mobile Asia Pacific Pte Ltd., Singapore 4. Tanla Solutions (UK) Limited, U.K. The step down subsidiaries of the Company are: 1. Tanla Mobile Ltd., UK a subsidiary of Tanla Solutions (UK) Ltd., UK. 2. Tanla Mobile Spain SL, Spain a subsidiary of Tanla Mobile Ltd., UK. 3. Tanla Mobile Middle East FZ LLC, Dubai 4. Tanla Mobile Inc., USA 5. Tanla Mobile South Africa Proprietary Ltd., South Africa 6. Tanla Mobile South Asia Pvt Ltd., Sri Lanka and 7. Tanla Mobile Ireland Pvt Ltd., Ireland are subsidiaries of Tanla Mobile Asia Pacific Pte Ltd., Singapore 8. Tanla Mobile Finland Oy, a subsidiary of Tanla Mobile Middle East FZ LLC, Dubai 9. Tanla Oy, Finland, is a subsidiary of Tanla Mobile Finland Oy TZ Mobile Private Limited, incorporated in July 2009 under the provisions of the Companies Act, 1956 is a Joint Venture between Tanla Solutions Ltd and Zed Worldwide Holdings SL, Spain each holding 50% of shareholding. 7. Consolidated Financial Statements Pursuant to the exemption granted vide General Circular No. 2/2011 dated February 08, 2011, by the Ministry of Corporate Affairs, Government of India, a gist of the financial performance of the subsidiary companies is contained in the Annual Report. The Annual Accounts of the subsidiary companies are open for inspection by any member/investor and the Company will make available these documents/details upon request by any member of the company to any investor of its subsidiary companies who may be interested in obtaining the same. In terms of Clause 32 of the Listing Agreement with the Stock Exchanges and as prescribed by Accounting Standard 21 notified by the Government of India under Section 211(3C) of the Companies Act, 1956, the Audited Consolidated Financial Statements duly signed by the Statutory Auditors are annexed elsewhere in this Annual Report. 8. Directors Responsibility Statement In terms of Section 217(2AA) of the Companies Act, 1956, the Board of Directors hereby confirm that: (i) In the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures; (ii) Appropriate accounting policies have been applied consistently, judgements and estimates which are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the loss of the company for that period; (iii) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the 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. 9. Corporate Governance Pursuant to the provisions of Clause 49 of the Listing Agreement with Stock Exchanges, a report on Corporate Governance together with a certificate from M/s Ravi & Subramanyam, Practicing Company Secretaries, Hyderabad, features as part of the Annual Report. The company will continue to implement and adhere in letter and spirit to the policies of good corporate governance. 10. Particulars of Employees In terms of the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, no employee /whole-time Director has been paid a remuneration equal to or exceeding the remuneration prescribed under the above amended rules. 11. Conservation Of Energy, Research And Development, Technology Absorption, Foreign Exchange Earnings And Outgo Conversation of Energy The operations of the Company are not energy intensive. However, adequate measures have been taken to conserve and reduce the energy consumption by using energy efficient hardware, usage of natural light and other equipment. Air Conditioners are used only when required and air-conditioned areas have been treated with heat resistant material. We continue to evaluate new technologies and invest to conserve and reduce energy consumption. We believe energy saved is energy produced. Research & Development, Technology Absorption The company has rendered certain cost effective products and solutions to its clients as a result of its constant endeavour to research and develop new products, processes and methodologies for improving the productivity and quality of its products and services. Foreign Exchange earnings and outgo The particulars regarding foreign exchange earnings and expenditure are annexed hereto and forms part of this report. 12. Employee Stock Option Options were granted to employees in October 2009, but no options were vested with the employees pursuant to the grant. Disclosures in compliance with Securities and Exchange Board of India (Employees Stock Option Scheme and Employee Stock Purchase Scheme Guidelines, 1999) as amended, are as under: Nature of Disclosure Particulars Options granted 41,75,000 options were granted on October 16, 2009, each option gives the grantee a right to subscribe to equity share of face value of Re.1/- each. At a discount of 20% on the latest available closing market price prior to The pricing formula the date of grant of options of the company on the exchange having the highest trading volume. Options Vested No Options were vested during the year Options Exercised No Options were exercised during the year Total number of shares arising No Options were exercised during the as a result of exercise of year option Options lapsed No Options were vested during the year Variation of terms of Options No variation has been done Money realized by exercise of As no Options were exercised during Options the year, no money was realized. Total number of options in 41,75,000 force Details of Options granted to senior managerial personnel Any other employee who receives No Options were granted during the a grant in any one year of option year 2011-12 amounting to 5% or more of option granted during the year Identified employees who were No Options were granted during the granted option, during any one year 2011-12 year, equal to or exceeding 1% of the issued capital (excluding outstanding warrants and conversions) of the company at the time of grant Diluted Earnings per share (EPS) No shares were issued as no options pursuant to issue of shares on were exercised. exercise of option calculated in accordance with Accounting Standard(AS) 20 - Earnings Per Share (i) Method of calculation of employee compensation cost. (ii) Difference between the compensation cost using the intrinsic value of the stock options (which is the method of accounting used by the company) and the Compensation cost that would have been recognized in the accounts if the fair value of options As no shares were allotted during had been used as method of the year 2011-12, this section is Accounting. in-applicable (iii) Impact of difference mentioned above in (i) above on the profits of the company. (iv) Impact of the difference mentioned in (i) above on the EPS of the company (i) Weighted Average exercise As no shares were allotted during price of options the year 2011-12, this section is in-applicable (ii) Weighted Average fair value of options (i) Method used to estimate the fair value of options (ii) Significant assumptions used (Weighted Average information relating to all grants):- (a) Risk free interest rate As no shares were allotted during the year 2011-12, this section (b) Expected life of options is in-applicable (c) Expected volatility (d) Expected dividend yields (e) Price of the underlying share in market at the time/ of option granted 13. Transfer of Unclaimed Shares to Suspense Account 870 Equity Shares held by 15 shareholders, in the 'Tanla Solutions Limited - Demat Suspense Account' in Axis Bank Ltd., Jubilee Hills Branch, Hyderabad, as on March 31, 2012 in accordance with the provisions of Clause 5A of the Listing Agreement. The voting rights on these shares shall remain frozen fill the rightful owner of these shares claims the shares. 14. Transfer of Unpaid/Unclaimed Dividend to the Investor Education and Protection Fund Pursuant to Section 205A(5) of the Companies Act, 1956, and other applicable guidelines,Rs. 1,28,579.00 (Rupees One lakh twenty eight thousand five hundred and seventy nine only) representing the 'Un-paid and Un-Claimed dividend for the year 2004-05' has been transferred to the Investor Education and Protection Fund. 15. Industrial Relations The company enjoyed cordial relations with the employees during the year under review and the Management appreciates the employees of all cadres for their dedicated services to the company, and expects continued support, higher level of productivity for achieving the targets set for the future. 16. Auditors and Auditor's Report M/s Ramasamy Koteswara Rao & Co., Chartered Accountants, Hyderabad, the Statutory Auditors, retire at the ensuing annual general meeting and are eligible for re-appointment. The company received confirmation that their appointment, if made, would be within the prescribed limits under the provisions of Section 224(1B) of the Companies Act, 1956. The Auditors Report to the shareholders for the year ended March 31, 2012 does not contain any qualification and therefore does not call for any explanations/comments. 17. Group List of Promoters including the Promoter Group of the company comprising 'Group' as defined under the Monopolies and Restrictive Trade Practices Act, 1969 (54 of 1969) pursuant to Regulation 3(1)(e)(i) of the SEBI(Substantial Acquisition of Shares & Takeovers) Regulations, 1997 are: 1. Mr. D. Uday Kumar Reddy 2. Mrs. D. Tanuja Reddy 3. Mr. Satish Kathirisetti 4. Mr. Gautam Sabharwal 18. Acknowledgements The Directors wish to express their appreciation of the support and co- operation of the Central and the State Governments, bankers, business partners, employees, associates and expects the same in future as well for sustaining the growth rates achieved in the past. On behalf of Board of Directors Sd/- Date : 14 August, 2012 D. Uday Kumar Reddy Place: Hyderabad Chairman & Managing Director Foreign Exchange earnings & outgo: a. Imports (valued on the cost, insurance and freight basis) In Rs. Particulars For the Year 2011-2012 For the Year 2010-2011 Import of capital goods 1725335 63878362 b. Activity in foreign currency In Rs. Particulars For the Year 2011-2012 For the Year 2010-2011 Earnings in foreign exchange (on accrual basis) Income from software 141501021 190709339 products and offshore development services Less: Expenditure in foreign exchange (on accrual basis) Cost of services 118302811 22503713 Foreign Travel Expenses 2233634 1558238 Professional Charges 320202 1493105 Net earnings in foreign exchange 18919039 101275921