Tanla Solutions Ltd.
|BSE: 532790||Sector: IT|
|NSE: TANLA||ISIN Code: INE483C01032|
|BSE LIVE 15:48 | 12 Dec||33.45||
|NSE 15:58 | 12 Dec||33.35||
|Mkt Cap.(Rs cr)||371|
|Mkt Cap.(Rs cr)||370.96|
Tanla Solutions Ltd. (TANLA) - Director Report
Company director report
The Directors have the pleasure in presenting their Report and the Audited FinancialStatements of your Company for the financial year ended March 312016.
SUMMARY OF FINANCIAL RESULTS (STANDALONE)
Rs. in lakhs
STATE OF THE COMPANYS AFFAIRS
During the period under review the Company has achieved revenue of Rs. 27994.61 Lacsand net profit of Rs. 831.97 Lacs on a Standalone basis. During the same period theCompany has achieved revenue of Rs. 43155.35 Lacs and net profit of Rs. 1191.44 Lacs ona consolidated basis.
TRANSFER TO RESERVES
The Company has not proposed to transfer any amount to the general reserve for theFinancial Year ended 31st March 2016.
The Company has declared an Interim dividend 0 20% of the paid up equity share capitali.e. Re. 0.20 per fully paid-up equity share of Re. 1/- each and the same shall beconsidered as final dividend for the financial year ending March 312016.
Tania Solutions (BSE: 532790 I NSE: TAN LA) a Flyderabad based Indian Company foundedin the year 1999 listed since 2007 is one of the largest A2P messaging platform serviceprovider globally and holds 60% of Indian market as of the previous fiscal.
Tania is listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange(NSE).
There are no Material changes and commitments affecting the financial position of theCompany during financial year 2015-16.
MANAGEMENT DISCUSSION & ANALYSIS
The Management Discussion and Analysis Report highlighting the industry structure anddevelopments opportunities and threats future outlook risks and concerns etc. isfurnished separately and forms part of this Annual Report.
DIRECTORS RESPONSIBILITY STATMENT as required under Section 136 of the CompaniesAct 2013
The Directors Responsibility Statement pursuant to the provisions of Section136(3) (c) and 136(5) of the Companies Act 2013 ("the Act") is appended asAnnexure-A to this Report.
CONSOLIDATED FINANCIAL RESULTS
Pursuant to Regulation 33 of SEBI (Listing Obligations & DisclosuresRequirements) Regulations 2015 and the Companies Act 2013 the Consolidated FinancialStatements prepared as per Companies Act 2013 and Accounting Standards duly auditedforms part of the Annual Report.
Consolidated Financial Statements incorporating the operations of the Company itssubsidiaries and Joint Venture Company is appended. As required under the provisions ofthe Act a statement showing the salient features of the financial statements of thesubsidiaries and joint ventures is enclosed as an Annexure-B to this Report.
The financial statements of the subsidiary companies will be made available to themembers of the Company and its subsidiary companies on request and will also be kept forinspection in the Registered Office of the Company.
Tania Solutions (UK) Limited formerly Techserv Teleservices (UK) Limited UK(hereinafter referred to as "Tania UK") a wholly owned subsidiary of Taniabased at London UK provides aggregator and offshore development services to clients intelecommunications and offshore service sectors.
Tania Corporation Private Limited India (Earlier known as Mufithumb CorporationPrivate Limited) a wholly owned subsidiary of Tania Solutions Limited based at HyderabadIndia is engaged in development of products and services.
Tania Mobile Asia Pacific Pte Limited Singapore (hereinafter referred to as"Tania Singapore") a wholly owned subsidiary of Tania based at Singaporeprovides aggregator and offshore development services to clients in telecommunications andoffshore service sectors.
Tania Mobile Ireland Pvt Limited Ireland (hereinafter referred to as "TaniaIreland") a wholly owned subsidiary of Tania Singapore based at Ireland providesaggregator services to clients in the telecommunications sector.
Tania Mobile Middle East FZ LLC Dubai (hereinafter referred to as "TaniaDubai") a wholly owned subsidiary of Tania Singapore based at Dubai UAE providesaggregator services to clients in the telecommunications sector.
Tania Mobile Finland Oy Finland (hereinafter referred to as "TaniaFinland) a wholly owned subsidiary of Tania Dubai based at Finland.
Tania Oy Finland (hereinafter referred to as "Tania Oy") a wholly ownedsubsidiary of Tania Finland Oy Finland provides payment solutions to clients intelecommunications and allied areas.
SAFETY HEALTH AND ENVIRONMENT (SHE)
The Company believes that a clean environment in and around the work place fostershealth and prosperity for individuals groups and the community they belong to. Regularmedical examinations of employees and health care schemes are an integral part of theCompanys policy. Company has put in place robust processes and performanceindicators to track its SHE performance.
The Companys policies give highest priority to safety both occupational andgeneral health of employees and on environment protection.
CORPORATE SOCIAL RESPONSIBILITY
As the Company has not made adequate profits during the preceding three (3) years theCompany is exempted from reporting on the amount spent on CSR activity.
Pursuant to the provisions of Section 135 of the Companies Act 2013 and the Rules madethereunder and pursuant to the recommendation of the Committee the Board has approved aCorporate Social Responsibility ('CSR) policy and the same has been uploaded in thewebsite of the Company www.tanla.com which containsthe CSR activities to be carried out by the Company governance structure implementationprocess etc.
A brief outline of the Companys CSR policy including overview of projects orprogrammes proposed to be undertaken and a reference to the web-link to the CSR policy andprojects or programmes.
To actively contribute to the social and economic development of the communities inwhich we operate and in the process build a better sustainable way of life for theweaker sections of society and to contribute effectively towards inclusive growth andraise the countrys human development index.
Our projects mainly focus on education healthcare sustainable livelihoodinfrastructure development and social reform epitomizing a holistic approach to inclusivegrowth.
The Board of Directors have adopted a CSR Policy in line with the section 135 ofthe Companies Act 2013.
The Companys CSR policy can be accessed on www.tanla.com
Composition of the CSR Committee:
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
Details of loans and guarantees given and investments made under Section 186 of the Actare given in the Notes to the Financial Statements.
The Company has not accepted any deposit from the public under Chapter V of the Act orunder the corresponding provisions of Section 73 and 74 of the Companies Act 2013 and noamount of principal or interest was outstanding as on the Balance Sheet date.
The paid up equity share capital of the Company as on March 31 2016 was 1014.8 Lakhs.During the year the Company had issued shares as detailed below:
Reconciliation of the shares outstanding at the beginning and at the end of thereporting period:
(ii) Terms/Rights and restrictions attached to the equity shares:
The Company has only one class of equity shares having a face value of Re.1/-. Eachshare holder is eligible for one vote per every share held
(iii) The details of shareholder holding more than 5% shares in the Company:
INTERNAL CONTROL SYSTEM
The Company has adequate internal controls consistent with the nature of business andsize of the operations to effectively provide for safety of its assets reliability offinancial transactions with adequate checks and balances adherence to applicable statuesaccounting policies approval procedures and to ensure optimum use of available resources.These systems are reviewed and improved on a regular basis. It has a comprehensivebudgetary control system to monitor revenue and expenditure against approved budget on anongoing basis.
The Company has its own corporate internal audit function to monitor and assess theadequacy and effectiveness of the Internal Controls and System across all key processescovering various locations. Deviations are reviewed periodically and due complianceensured. Summary of Significant Audit Observations along with recommendations and itsimplementations are reviewed by the Audit Committee and concerns if any are reported toBoard.
PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Companies Act 2013 read with Rule5(2) and 5(3) of the Companies (Appointment & Remuneration of Managerial Personnel)Rules 2014 a statement showing the names and other particulars of the employees drawingremuneration in excess of the limits set out in the said rules are provided in annexure tothis report. Disclosure pursuant to Section 197(12) of the Companies Act 2013 read withRule 5(1) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules2014 is provided as Annexure C of this Report.
EXTRACT OF THE ANNUAL RETURN
In accordance with Section 134(3) (a) of the Act an extract of the Annual Return(MGT-9) in the prescribed format is appended as Annexure E to this Report.
Your Company is committed to good Corporate Governance coupled with good corporatepractices. As per the requirements of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a Compliance Report on Corporate Governance for the year2015-16 from a Practicing Company Secretary confirming compliance with the conditions ofCorporate Governance is attached to the Report on Corporate Governance.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Ms. Kalpana Reddy was appointed as an Additional Director Non-Executive &Independent with effect from October 30 2015 for a period of two years subject toapproval of shareholders at the ensuing Annual General Meeting of the Company.
Dr. A.G.Ravindranath Reddys was re-designated as Non- Executive IndependentDirector with effect from June 30 2016 for a period of two years subject to approval ofshareholders at the ensuing Annual General Meeting of the Company.
During the year under review the Board of Directors in their meeting held on October30 2015 have appointed as the Additional Director (Independent Woman Director) on theBoard and also as the member of Audit Committee of the Company with effect from October30 2015.
The Company has received declarations from all the Independent Directors of the Companyconfirming that they continue to meet the criteria of independence as prescribed undersub-section (6) of Section 149 of the Companies Act 2013 and under Regulation 25 of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.
Mr. Srinivas Gunupudi Kamoji Chief Financial Officer and Mrs. Seshanuradha ChavaCompany Secretary are the Key Managerial Personnel (KMP) of the Company in terms of theprovisions of the Act.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
On their appointment Independent Directors are familiarised about the Companysoperations and businesses. Interaction with the Business Heads and key executives of theCompany is also facilitated. Detailed presentations on the business of each of theprocesses are made to the Directors. Direct meetings with the Chairman & ManagingDirector are further facilitated for
the new appointee to familiarize him/her about the Company/its businesses and the grouppractices.
NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS
During the year ended March 312016 Six (6) Board Meetings were held. And the dates onwhich they were held are - May 27 2015; August 07 2015; October 30 2015; November 182015 February 012016 and March 16 2016.
INTERNAL FINANCIAL CONTROL SYSTEM
The internal financial controls to be followed by the company were laid down for allthe major processes to ensure reliability of financial reporting. The internal financialcontrol system assists management to have timely data/ feedback on various operationalparameters for effective review. It also ensures proper safeguarding of assets across theCompany and its economical use. The Company had appointed an independent consultant Ernst& Young LLP to assist them in internal financial control system review. In opinion ofthe Board the internal financial control system of the Company is commensurate with thesize scale and complexity of its operations and such internal financial controls wereadequate and were operating effectively. The systems and controls are periodicallyreviewed and modified based on the requirement. The Company has an internal auditfunction which is empowered to examine the adequacy and compliance with policies plansand statutory requirements. It is also responsible for assessing and improving theeffectiveness of risk management control and governance process. The scope of InternalAudit is well defined and documented and the audit committee reviews the observations ofthe Internal Audit critically. The composition and working of the audit committee formspart of the Corporate Governance Report.
WHISTLE BLOWER POLICY/VIGIL MECHANISM
In staying true to our values of Strength Performance and Passion and in line with ourvision of being one of the most respected companies in India the Company is committed tothe high standards of Corporate Governance and stakeholder responsibility.
In line with requirement of the Companies Act 2013 and of Regulation 22 of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 VigilMechanism/Whistle Blower Policy has been formulated for Directors and employees to reportconcerns about unethical behaviour actual or suspected fraud or violation ofCompanys Code of Conduct etc. The said Policy provides for adequate safeguardagainst victimization of directors/employees who avail of such mechanism and providesaccess to the Chairman of Audit Committee in exceptional cases.
It is affirmed that no person has been denied access to the Audit Committee. TheWhistle Blower Policy has been placed on website of the Company and web link thereto is
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosures Requirements) Regulations 2015 the Board has carried out evaluation of itsown performance the performance of Committees of the Board namely Audit CommitteeStakeholders Relationship Committee and Nomination and Remuneration Committee and alsothe Directors individually. The manner in which the evaluation was carried out and theprocess adopted has been mentioned out in the Report on Corporate Governance.
The Board has on the recommendation of the Nomination & RemunerationCommittee framed a policy for selection and appointment of Directors Key ManagerialPersonnel Senior Management and fixing their remuneration. The Remuneration Policy isprovided in the Corporate Governance Report.
RISK MANAGEMENT POLICY
The Company has laid down the procedure for risk assessment and its mitigation throughan internal Risk Management team. Key risks and their mitigation arising out of reviews bythe Committee are assessed and reported to the Audit Committee on a periodic basis. TheRisk Management Policy details the Companys objectives and principles of RiskManagement along with an overview of the Risk Management processes procedures and relatedroles and responsibilities.
MATERIAL SUBSIDIARY POLICY
The Company has adopted a policy for determining material subsidiary in line with therequirements of the
Act and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. ThePolicy on Material Subsidiary is available on the website of the Company and web Linkthereto is www.tanla.com
RELATED PARTY TRANSACTIONS
There were no materially significant related party transactions made by the Companywith Promoters Directors Key Managerial Personnel or other designated persons which mayhave a potential conflict with the interest of the Company at large.
None of the Directors had any pecuniary relationship or transactions with the Companyexcept the payments made to them in the form of remuneration sitting fee and commission.
In accordance with Section 134(3) (h) of the Companies Act 2013 and Rule 8(2) of theCompanies (Accounts) Rules 2014 the particulars of contract or arrangement entered intoby the Company with related parties referred to in Section 188(1) in Form AOC-2 isattached as Annexure F.
The details of related party disclosures form part of the notes to the financialstatements provided in this annual report.
Audit Committee of the Company meets the requirements of section 177 of the CompaniesAct 2013 and Regulation 18 SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. The details of the composition of the Audit Committee as required underthe provisions of Section 177(8) of the Companies Act 2013 is given in the CorporateGovernance Report furnished as part of the Annual Report. During the year under reviewthe Board has accepted all the recommendations of the Audit Committee.
The Audit Committee comprises of Mr. Ram Narain Agarwal Chairman and Dr.A.G.Ravindranath Reddy Ms. Kalpana Reddy & Mr. Gautam Sabharwal Members. All therecommendations made by the Audit Committee were accepted by the Board.
NOMINATION AND REMUNERATION COMMITTEE
Nomination and Remuneration Committee meets the requirements of section 178 of theCompanies Act 2013 and Regulation 19 SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
The details of the composition of the Nomination and Remuneration cum CompensationCommittee as required under the provisions of Section 178 of the Companies Act 2013 isgiven in the Corporate Governance Report furnished as part of the Annual Report.
During the year under review the Board has accepted all the recommendations of theNomination and Remuneration Committee.
The Statutory Auditors of the Company M/s Ramasamy Koteswara Rao & Co. CharteredAccountants were appointed as Auditors of the Company for a period of three years fromthe conclusion of the 18 th Annual General Meeting held on September 30 2014 and ratifiedby the Members in 19 th Annual General Meeting help on September 16 2015. As requiredunder the provisions of Section 139 of the Act a resolution for the yearly ratificationof their appointment is being placed before the shareholders for their approval. In thisregard the Company has received a certificate from the auditors to the effect that ifthey are reappointed it would be in accordance with the provisions of Section 141 of theAct.
The Company has appointed KPMG in India as the Internal Auditors which monitors theeffectiveness of the internal control systems. It reports to the Audit Committee about theadequacy and effectiveness of the internal control system of the Company.
The recommendations of the internal audit team on improvements in the operatingprocedures and control systems are also presented to the Audit Committee and the businessto use these as tools for strengthening the operating procedures.
As per the provisions of Section 204 of the Act and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Board had appointed R&AAssociates Company Secretaries as Secretarial Auditor to conduct Secretarial audit of theCompany for the financial year ended on March 312016. Secretarial Audit Report issued byR&A Associates Company Secretaries in form MR-3 is enclosed as Annexure -G to thisAnnual Report.
People are our most valuable asset and they play a vital role in the growth of yourCompany. The Company places the engagement development and retention of talent as itshighest priority to enable achievement of organizational vision. Structure Process andCulture are the cornerstones of our Human Resource strategy and we have made strides inthese areas during the last year.
With an unswerving focus on nurturing training and retaining talent the Companyprovides avenues for learning and development through functional behavioral andleadership training programs communication channels for information sharing to name afew.
The Company's Human Resources team plays a critical role in your Companys talentmanagement process. The Company continues to strive to build a performance driven cultureand create an environment conducive for the employees growth. The Company alsobelieves that the human capital is of utmost importance to sustain the market leadershipto capture new markets.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars as prescribed under Sub-section (3)(m) of Section 134 of the Act readwith Companies (Accounts) Rules 2014 are enclosed as Annexure-H to this Report.
EMPLOYEES STOCK OPTIONS SCHEME
The Nomination and Remuneration Committee has cancelled the ESOP Scheme 2008 and theunderlying ESOP Pool of 5000000 Options. The Board in its meeting held on August 132015 has approved ESOP 2015-16 Policy to its Employees with 50 Lakh fully paid-up EquityShares which was approved by the shareholders in the last Annual General Meeting held onSeptember 16 2016. And the Board in its meeting held on November 18 2016 granted ESOPsto the eligible employees of Tania Solutions Limited and its Subsidiaries based on therecommendations made by The Nomination and Remuneration Committee. The details of EmployeeStock Options pursuant to Section 62 of the Companies Act 2013 read with Rules madethereunder; and SEBI (Share Based Employee Benefits) Regulations 2014 and erstwhile SEBI(Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999 areprovided as Annexure I to this Report.
SEXUAL HARASSMENT POLICY
The Company as required under the provisions of "The Sexual Harassment of Women atWorkplace (Prohibition Prevention and Redressal) Act 2013" has framed a Policy onProhibition Prevention and Redressal of Sexual Harassment of Women at Workplace andmatters connected therewith or incidental thereto. Internal Complaints Committee (ICC) hasbeen set up to redress complaints received regarding sexual harassment. All employees(permanent contractual temporary trainees) are covered under this policy.
In the year under review the Company has not received any complaint under this Policy.Your Directors place on record their appreciation for the services rendered by theemployees. The relation between the management and the employees has been cordialthroughout the year.
The Board of Directors take this opportunity to place on record their appreciation toall the Stakeholders of the Company viz. customers investors banks regulatorssuppliers and other business associates for the support received from them during the yearunder review. The Directors also wish to place on record their deep sense of gratitude andappreciation for all the employees for their commitment and contribution towards achievingthe goals of the Company.