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ABM Knowledgeware Ltd.

BSE: 531161 Sector: IT
NSE: N.A. ISIN Code: INE850B01026
BSE 00:00 | 20 May 94.70 0.95
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NSE 05:30 | 01 Jan ABM Knowledgeware Ltd
OPEN 96.65
PREVIOUS CLOSE 93.75
VOLUME 938
52-Week high 152.40
52-Week low 85.00
P/E 11.91
Mkt Cap.(Rs cr) 189
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 96.65
CLOSE 93.75
VOLUME 938
52-Week high 152.40
52-Week low 85.00
P/E 11.91
Mkt Cap.(Rs cr) 189
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

ABM Knowledgeware Ltd. (ABMKNOWLEDGE) - Director Report

Company director report

To the Members of

ABM Knowledgeware Limited

Your Directors are delighted to present the 28*h Annual Report of theCompany along with the Audited Financial Statements (Standalone & Consolidated) forthe Financial Year ended 31st March 2021.

1. FINANCIAL PERFORMANCE OF THE COMPANY (STANDALONE & CONSOLIDATED):

(Rs. In Thousand)

Consolidated Standalone
Particulars Year ended Year ended
31.03.2021 31.03.2020 31.03.2021 31.03.2020
Gross Income 1073018 892844 910524 762023
Profit Before Interest and Depreciation 311173 227573 274430 206081
Finance Charges 4322 2484 4322 2484
Gross Profit 306851 225089 270108 203597
Provision for Depreciation 20450 17618 11510 11527
Net Profit Before Tax 286401 207471 258598 192070
Provision for Tax 70383 39216 62677 38922
Non-Controlling Interest 15914 11964 - -
Net Profit After Tax 200104 156291 195921 153148
Surplus - Opening Balance 1574256 1476781 1572121 1477973
Amount Available for Appropriation 1774360 1633072 1768041 1631121
Other Comprehensive (Income) / Loss (net of tax) (2347) (1468) (2378) (1284)
Dividend and Dividend tax paid during the year - 60284 - 60284
Surplus - closing balance 1776707 1574256 1770420 1572121

2. OPERATIONS OF THE COMPANY :

The Company's operations continued with technical employees Working From Home (WFH) andthose working on customer support working at customer locations across India.

There has been a mixed impact of WFH on operations. It has worked well with senioremployees. However the middle and junior level employees productivity has not shownencouraging trends. ABM operates in a niche domain area and requires proper induction ofnewly onboarded employees interactively including customer visits. We have also noticedchallenges in talent acquisition during last year. Implementation of our projects requiresa significant presence of employees on the project sites across India. This need foronsite availability posed challenges as many employees were highly concerned abouttravelling and staying onsite for longer. As a result it has delayed some of theprojects.

A large part of the working during current year is likely to be WFH due to restrictionson the public transport. Employees in cities other than Mumbai can undertake local as wellas distant travel.

WFH has a very positive impact on the Company's internal operations with virtually alloperations being conducted remotely. Some customers have preferred virtual meetingshelping in more convenient business operations. Due care is being taken to ensure secureaccess during WFH and various COVID protection measures for the employees.

3. DIVIDEND :

Your Directors have recommended a Final Dividend @ 25% i.e. Rs. 1.25/- per Equity Shareof Face Value of Rs. 5/- each for the Financial Year ended 31st March 2021.The Final Dividend subject to the approval of Members at the Annual General Meeting to beheld on Thursday 12th August 2021 and will be paid to the Members on orbefore Monday 30th August 2021 to the members whose names appear in theRegister of Members as on the Record Date. i.e. 5th August 2021.

The Dividend if approved will result in a cash outflow of Rs. 25002750/-. In viewof the changes made under the Income- tax Act 1961 by the Finance Act 2020 dividendspaid or distributed by the Company shall be taxable in the hands of the Shareholders. YourCompany shall accordingly make the payment of the final Dividend after deduction of taxat source.

4. TRANSFER TO RESERVES :

Your Directors do not propose to transfer any amount to the General Reserve out of thecurrent year's profit.

5. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND :

In terms of the provisions of Investor Education and Protection Fund (AccountingAudit Transfer and Refund) Rules 2016 and Investor Education and Protection Fund(Awareness and Protection of Investors) Rules 2001 Rs. 255161/- of unpaid / unclaimeddividends were transferred during the year to the Investor Education and Protection Fund(IEPF).

6. SHARE CAPITAL :

As on 31st March 2021 the Authorized share capital of your Company was Rs.125000000/- consisting of Rs. 25000000 Equity Shares of Rs. 5/- each and paid upequity share capital was '102415000/- consisting of 20002200 fully paid up equityshares and 697800 forfeited equity shares of '5/- each.

During the year under review the Company has not issued any shares or Bonus shares.The Company has not issued shares with differential voting rights. It has neither issuedemployee stock options nor sweat equity shares. The Company has not bought back any of itsequity shares.

7. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP) :

In accordance with the provisions of the Section 152 of Companies Act 2013 Mrs.Supriya P. Rane Director retires by rotation at the forthcoming Annual General Meetingand being eligible offer herself for re-appointment. The Board recommends herre-appointment.

A brief profile of Mrs. Supriya P. Rane has been given in the Report on the CorporateGovernance as well as in the Notice of the ensuing Annual General Meeting of the Company.

Section 149(10) of the Companies Act 2013 provides that Independent Directors shallhold office for a term up to five consecutive years on the Board of a Company and shall beeligible for re-appointment on passing a Special Resolution by the Shareholders of theCompany. Accordingly the Company has sought approval of the Members of the Companythrough Postal Ballot on 3rd May 2021 for re-appointment of Dr. SumitChowdhury as Independent Director of the Company for a second term of 5 (five) consecutiveyears w.e.f 28*h March 2021 up to 27*h March 2026.

On the recommendation of Nomination and Remuneration Committee the Board of Directorshad proposed the appointment of Mr. Punit Kumar Jain as an Independent Director of theCompany for the members approval in their meeting held on 04*h September 2020.After seeking the approval of the shareholders Mr. Punit Kumar Jain was appointed as theNon-Executive Independent Director of the Company to hold office for a consecutive term offive years commencing from 04*h September 2020 to 03rd September2025. In view of his wide enlightened experience in Business the Board of Directors is ofthe view that associating Mr. Punit Kumar Jain as Director the Company would benefitimmensely. Further the members had approved the re-appointment of Mr. Prakash B. Rane asthe Managing Director of the Company for a further period of 5 years commencing from 1s*April 2020 to 31st March 2025.

There has been no change in the Key Managerial Personnel (KMPs) of your Company duringthe year under review.

As per the provisions of the Act the Independent Directors are not liable to retire byrotation. The Independent Directors of your Company have given the certificate ofindependence to your Company stating that they meet the criteria of independence asmentioned under Section 149(6) of the Companies Act 2013 and the Listing Regulations.There has been no change in the circumstances affecting their status as IndependentDirectors of the Company.

During the year under review the non-executive Directors of the Company had nopecuniary relationship or transactions with the Company other than sitting fees andcommission if any.

8. POLICY ON DIRECTOR'S APPOINTMENT REMUNERATION BOARD EVALUATION AND DETAILS OFFAMILIARISATION PROGRAMS :

The policy on Director's appointment and remuneration including criteria fordetermining qualifications positive attributes independence of Director and alsoremuneration for Key Managerial Personnel and other employees forms part of the CorporateGovernance Report of this Annual Report. Annual Board Evaluation process for Directors hasalso been provided under the Report on Corporate Governance. On the recommendations ofNomination and Remuneration Committee and approval of the Board of Directors the Companyhas sought approval of the Members through Postal Ballot for payment of commission toNon-Executive directors for a period of five years commencing from 1s* April2021 upto 31stMarch 2026 as per amended Section 197 of the Companies Act 2013read with Schedule V to the Act.

The details of programmes for familiarisation of Independent Directors with theCompany their roles rights responsibilities in the Company nature of the industry inwhich the Company operates business model of the Company and related matters are put upon the website of the Company at www.abmindia.com. The Company has issued a formal letterof appointment to the Independent Director in the manner as provided in the Companies Act2013. The terms and conditions of the appointment have been disclosed on the website ofthe Company.

9. MEETINGS :

During the year five (5) Board Meetings and five (5) Audit Committee Meetings wereconvened and held. For the details of the meetings of the Board and its Committees pleaserefer to the Report on Corporate Governance which forms part of this report. Theintervening gap between the Meetings was within the period prescribed under the CompaniesAct 2013.

10. PUBLIC DEPOSITS :

During the year under review your Company did not accept any public deposits underChapter V of Companies Act 2013 and no amount on account of principal and interest onpublic deposits was outstanding on the date of the Balance Sheet. Since the Company hasnot accepted any deposits during the financial year ended 31st March 2021there has been no non-compliance with the requirements of the Act.

11. SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES :

InstaSafe Technologies Private Limited ("InstaSafe") a subsidiary of yourCompany is a leading Cloud based Security- as-a-Service solution provider deliveringcomprehensive and uncompromising protection to mobile and remote workers enabling them tosafely and securely access enterprise apps email and web from anywhere on any network."InstaSafe Inc" is wholly owned subsidiary of InstaSafe Technologies PrivateLimited incorporated in Delaware United State of America.

Pursuant to the provisions of Section 129(3) of the Companies Act 2013 a statementcontaining salient features of financial statements of subsidiary company in Form AOC-1 isattached herewith. The separate audited financial statements in respect of the subsidiarycompany are available on the website of the Company at www.abmindia.com. Your Company willalso make available these documents upon request by any member of the Company interestedin obtaining the same.

As on 31 s* March 2021 the Company does not have any Joint venture orAssociate Company.

12. PERFORMANCE OF SUBSIDIARY COMPANIES :

The outlook for FY20-21 as outlined in the last annual report was to scale globallyand focus on enhancing product adoption and building the InstaSafe brand trusted byinternational customers.

One commonality that nearly every organization in the world shared in 2020 was the massexodus of users from the comfortable swanky offices to each worker's (insecure) homeoffice. Work continued in this pandemic as transition to "work-from-home" thanksto SaaS applications. In this context Zero Trust network access (ZTNA) became thesignature security technology of the pandemic. That has inspired organizations toreimagine how security (and networking) can be consumed both today and in the future.

InstaSafe got recognized for the third time by Deloitte India Fast 50 & APAC Fast500 with consistent revenue growth consistently over the last three years. In additionthe prestigious FT Asia ranked InstaSafe as one of the top growing companies out of Indiaand with an Asia Pacific rank of 55 and absolute growth rate of 894%.

For the Financial Year 2021-2022 the outlook is to execute with a focused approach toenhancing customer success and user delight and building a brand that is trusted globally.InstaSafe will continue to invest rapidly in the fast competitive market and expect ourR&D technology sales operation and marketing expenses to increase significantlythis year.

13. STATUTORY AUDITORS :

M/s. Borkar & Muzumdar Chartered Accountants (Firm's Registration No. 101569W)were re-appointed as Statutory Auditors of the Company at the Annual General Meeting heldon 16*h August 2019 for a second term of 5 consecutive years. The Auditorshave confirmed that they are not disqualified from being re-appointed as Auditors of theCompany.

The requirement to place the matter relating to appointment of auditors forratification by Members at every AGM has been done away by the Companies (Amendment) Act2017 with effect from May 7 2018. Accordingly no resolution is being proposed forratification of appointment of statutory auditors at the ensuing AGM.

14. AUDITORS' REPORT :

The Report given by the Auditors on the Financial Statements of the Company is part ofAnnual Report. There has been no qualification reservation adverse remark or disclaimergiven by the Auditors in their Report. Hence it is an unmodified opinion in terms of theapplicable provisions of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. During the year under review the Auditors had not reported any matterunder Section 143 (12) of the Companies Act 2013. Notes to Accounts and Auditors remarksin their report are self-explanatory and do not call for any further comments.

15. SECRETARIAL AUDIT REPORT:

Pursuant to the provisions of the Section 204 of the Companies Act 2013 the Companyhas undertaken Secretarial Audit for the financial year 2020-2021 which inter-aliaincludes audit of compliance with the Act and the Rules made under the Act ListingRegulations and applicable Regulations prescribed by the SEBI and Foreign ExchangeManagement Act 1999 and Secretarial Standards issued by the Institute of the CompanySecretaries of India. The Board has appointed Mr. Upendra Shukla Practicing CompanySecretary as Secretarial Auditor to undertake the Secretarial Audit of the Company for theyear ended on 31st March 2021. The Secretarial Audit Report issued by Mr. Upendra Shuklain Form No. MR-3 forms part of this Annual Report and is an Annexure to the Annual Report.The Secretarial Audit Report does not contain any qualification reservation or adverseremark except the following observation:

There was a delay of 42 days in submitting the Disclosure on Related PartyTransactions for the half year ended on 30h September 2020 underRegulation 23(9) of the SEBI (LODR) Regulations 2015.

Renewal of Mr. Devendra K. Parulekar Independent Director's registration inIndependent Director's Databank with ndian Institute of Corporate Affairs asrequired under Rule 6 of the Companies (Appointment and Qualifications of Directors)Rules 2014 is still pending.

The Company was levied with a penalty amount of Rs. 247800/- by BSE forNon-compliance with disclosure of related party transactions on consolidated basis as perStandard Operating Procedure (SOP) prescribed by SEBI. The disclosure was submitted by theCompany on 19/01/2021 and the Company had duly paid the penalty levied. Further due tocertain unavoidable circumstances and due to inadvertence one of our Director could notcomplete the renewal of his Independent Director's registration in Independent DirectorsDatabank.

16. COMPLIANCE WITH SECRETARIAL STANDARDS :

The Company has complied with Secretarial Standards issued by the Institute of CompanySecretaries of India on Board Meetings General Meetings and dividend.

17. INTERNAL AUDIT AND INTERNAL FINANCIAL CONTROL SYSTEMS:

The Board of your Company has laid down internal financial controls to be followed bythe Company and that such internal financial controls are adequate and operatingeffectively. Your Company has adopted policies and procedures for ensuring the orderly andefficient conduct of its business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial disclosures.

The Audit Committee reviews the reports submitted by the Internal Auditors in each ofits meeting. The Management duly considers and takes appropriate action on recommendationsmade by the Statutory Auditors Internal Auditors and Audit Committee of the Board ofDirectors. The Company has appointed M/s. S. P Sule & Associates CharteredAccountants as Internal Auditor of the Company for the financial year 2020-2021.

18. CORPORATE GOVERNANCE :

Corporate Governance is a continuous process at ABM. Maintaining high standards ofCorporate Governance has been fundamental to the business of your Company since itsinception. It is about commitment to values and ethical business conduct. Your Company iscommitted to sound corporate practices based on conscience openness fairnessprofessionalism and accountability paving the way in building confidence among all itsstakeholders for achieving sustainable long term growth and profitability. Your Companyhas complied with the governance requirements provided under the Companies Act 2013 andlisting regulations.

A separate Report on Corporate Governance together with Auditor's Certificateconfirming compliance with the conditions of Corporate Governance as stipulated underSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 is annexed to this Report.

A Certificate of the Chief Executive Officer and Chief Financial Officer of the Companyin terms of Listing Regulations inter-alia confirming the correctness of the financialstatements and cash flow statements adequacy of the internal control measures andreporting of matters to the Audit Committee is also annexed. The said certificate issigned by Mr. Prakash B. Rane Managing Director and Mr. Paresh Golatkar Chief FinancialOfficer of the Company.

19. MANAGEMENT DISCUSSION AND ANALYSIS REPORT :

A. Industry Structure and Development:

ABM's customer segment is predominantly Domestic government. Pandemic worked like aDisruption creating impact speed and scale in e-Government. E judiciary Virtualmeetings E-education Telemedicine Online approvals have ecome an integral part of dailylife in government.

Government has also responded to the pandemic by expediting Digital Government Policy.

In the short term it was a REACT mode. The focus was on the use of a digital platformlike a portal mobile social media and working on protecting the privacy and sensitiveinformation. It is a RESOLVE mode in the midterm such as leveraging the lessons learnedand policy ideas from the ongoing crisis. In the long term it will be a REINVENT mode.Efforts are being made to invest in innovative technologies like Artificial IntelligenceData Analytics Blockchain etc.

These technologies in E-government can effectively allocate scarce resources likeManpower Money Infrastructure and Natural resources. Therefore it will go much beyondmere electronic service delivery.

The competition landscape remained more or less unchanged with very few national levelplayers and some regional competitors.

B. Existing Opportunities and Outlook:

During the last year the Local State and Central Governments have prioritizedfighting the pandemic by balancing protection to lives and livelihoods. That has impactedthe usual volumes of e-Governance tenders being floated or finalized. This could impactrevenue during the current year. In addition the plans to explore opportunities in5-Dimensional Digital Project Management System (DPMS) slowed down due to the impact ofthe pandemic on the infrastructure sector. This situation is likely to improve in thelatter half of the current year as wave two is expected to taper off. The current year isalso primarily centered on Recovery and Restart.

ABM has started the new financial year with approximately Rs. 250 Crs order book andwould expedite the execution to realize the revenue. In addition efforts are being madeto win projects in states where ABM is present for a past few years.

The opportunities in Smart Cities SAP Implementation Services DPMS Cybersecuritywill continue even in the current year. The Government customers require to improve theefficiency of operations which will need IT interventions and spending on IT projects.This need will increase as an impact of the pandemic. In the medium term this will throwopen more and more opportunities. In the medium term Tech Spend has a positive outlook.Tech demand will rise buoyed by the need for Cloud collaborative workplace technologiesmobility and cybersecurity for Government Digital business is also likely to increase.

As outlined earlier ABM has been developing two additional verticals for the pastcouple of years apart from the E-government. These are Cybersecurity (a subsidiary of ABM)and Digital Project Management Systems for large infrastructure projects. In the next 2-3years these verticals can double the revenues of ABM subject to overall healthymacroeconomic conditions and reduced impact of COVID soon.

ABM will continue following a cautious approach of doing selective bidding byprioritizing the Company's ability to execute the project "successfully andprofitably". This strategy is seen to be working well so far to its revenues as wellas profits.

C. Business Threats :

The Business threat from competition has not altered much. The adverse impact of COVIDon floating new tenders and directions given by various Govts to cut down on plannedexpenditure is seen as a possible threat. Indian macroeconomy has not been performing verywell for the past 1 -2 years. The short-term setback due to the pandemic will add furthersluggishness due to pressure on Govt. operations and revenues. This poses a short-termthreat.

As mentioned earlier COVID has also impacted talent acquisition and retention to acertain extent due to the requirement of our employees onsite for project implementationand support. Suitable plans and processes have been laid down. As these processes maturethis threat will be mitigated substantially.

As we have been outlining in most of the annual reports the Company faces variousrisks and threats associated with the e-government business. It includes possible paymentdelays Time and Cost overruns Disruptions in the project when the organization's head ischanged. In addition challenges in attracting good talent to work in less developedstates and interior regions of India add to the threats. Moreover inexperiencedcompetition remains a threat and results in the loss of some opportunities due tounrealistic prices quoted by such companies.

D. Business Strategies and Planning :

The strategy of working closely with existing prestigious customers and retaining themwill continue with due consideration to the increased competition in some of the Company'skey accounts.

Efforts will be made to leverage the current market leadership in the e-Municipalityspace explore adjacent business areas and strengthen the two additional verticals ofCybersecu rity and DPMS for the infrastructure sector.

E. Human Resource Management :

The FY 2020-2021 at early onset brought in COVID-19 pandemic having its impact on everyaspect of human life and businesses alike. ABM was and is no exception to witness theunfolding story of COVID-19 that has complexities and fluidity in its ever-changingdimensions.

The biggest visible impacts of the virus have been on the nature of workplaces and likeevery business across globe; ABM had scrambled to comply with lockdown restrictions whilestriving to keep operations going.

Work-from-home (WFH) became the immediate solution to business continuity. Theleadership HODs and Employees through series of consultations were able to formulate andimplement the WFH strategy with three key aspects viz. Agility Creativity andFlexibility.

ABM supported all its employees with digital infrastructure - laptops data cardsvirtual meet subscriptions - to ensure that business continuity could be maintained. As aresult the brick-and-mortar office was transformed into virtual workplaces.

HR function stepped up to amend guidelines to ensure that employees could manage WFHseamlessly and securely. Upon achieving our first goal viz. business continuity; the majoremphasis was on "Human Connect". The HR function provided critical communicationon safety protocols hygiene practices emergency numbers list of hospitals guidelinesfor quarantining and isolating and much more.

We went the extra mile to help employees handle stress by setting up online classes foremployee wellbeing and motivation.

ABM over a period of two decades has delivered many critical projects successfully ingovernment sector. These projects were significant aid to many of government clients. ABMin fact had fought and won battle on two fronts; one being ensure organization wideBusiness Continuity and other was to ensure client received every humanly support possiblethrough resource mobilization in COVID-19 affected areas 24x7 monitoring of variousapplications manage changes within systems with utmost priority etc.

With all adversities posed by COVID-19 Pandemic; we stayed on course and continued withour approach to Human Capital Management.

Our approach to Human Capital Management is built on four pillars viz. Up-skillingWork-Life Balance Open & Fair Work Environment and Integrity.

1. Up-skilling

As a part of HR's upskilling initiative ABM's team had the opportunity to be a part ofthe training workshop on Local Self Government. This training apart from upskilling wasdesigned to sensitize our employees on inner workings of front-line service deliveryinstitutions i.e. municipalities.

The online workshop included training topics such as:

• Constitutional Mandate of Municipalities

• Roles and Responsibilities of Municipalities

• Organizational Structure

• Roles and Responsibilities of various Department

• Municipal Finance etc.

2. Work-Life Balance

In midst of the pandemic ABM introduced the "Human Connect" stayingconnected virtually by introducing multiple online engagement activity. The primaryobjective was guide our human capital to manage stress improve the employee and employerrelationship in Remote Workplace Environment and keep employees motivated remotely.

The various activities conducted virtually were:

• Basic Zumba Dance Lessons

• Fitness Tips

• Yoga Sessions

• Meditation Sessions

• Nutrition Advice from our empaneled Nutritionists

3. Open & Fair Work Environment

Although majority of the workforce works remotely; we have maintained Open & FairWork Environment in line with "Business as Usual" policies such as:

• Equal Opportunities & Non-Discrimination Policy and do not discriminate onbasis of race color gender caste or religion.

• Open and transparent communication through various HR policies and employeeforums. For E.g. Employee grievance redressal policy and escalation policy &Prevention of Sexual Harassment (POSH).

• Equal opportunity for employee to learn and grow within the organization.

• ABM empaneled new Advocate as a member in Sexual Harassment Committee.

4. Headcount

Year Current Headcount*
1 April 2019 - March 2020 453
2 April 2020 - March 2021 451

* excludes full time associates and in-house consultants.

F. Discussion on financial performance with respect to the operational performance :

(Rs. in Thousand)

Consolidated Standalone
Particulars Year ended Year ended
31.03.2021 31.03.2020 31.03.2021 31.03.2020
Gross Income 1073018 892844 910520 762023
Total Expenditure 636016 545598 516667 441336
i) Operating Expenses 249452 219259 196562 143435
ii) Expenditure (excluding Operating Expenses) 386564 326339 320105 297901
Gross profit before depreciation and Taxation 306851 225089 270108 203597

The Company has improved its overall performance in terms of revenues. As a result itcould maintain reasonable gross profit despite pandemic impacting the key customersegment i.e. Government organizations.

The increase in operating costs is in line with the increase in revenue. During the FY2019-2020 operating cost was 24% of revenue from operations and during FY 2020-2021 theratio stands at 27%. The increase in the expenditure is on account of payment toconsortium partners in various projects. ABM implements many projects by forming aconsortium with other IT companies as consortium partners who bring complementary skillsto win and execute the projects. The invoicing for the work done by the consortium partneris done by ABM wherever ABM is the Lead Bidder of the consortium.

The Company's dividend policy is designed considering the need for liquidity in thecustomer segment ABM operates. The payment cycles of ABM customers is much slower than inthe corporate sector. In addition the pandemic has caused other adverse impacts on thepayment cycles of customers. This situation requires liquidity with ABM for the smoothexecution of existing projects and undertaking new projects.

G. Key Financial Ratios :

In accordance with the SEBI (Listing Obligations and Disclosure Requirements 2018)Amendment Regulations 2018 the Company is required to give details of significant changes( changes of 25% or more as compared to the immediately previous financial year ) in keyfinancial ratios. There are no significant changes in the key financial ratios that areidentified by the Company below are the details

Standalone Ratios :

Ratios Unit March 2021 March 2020
Debtors Turnover Ratio Times 3.11 2.84
Current Ratio Times 6.26 6.13
Debt Equity Ratio Times 0.00 0.00
Net profit Margin % 22.77% 21.32%
Return on Net worth % 10.46% 9.17%

Consolidated ratios :

Ratios Unit March 2021 March 2020
Debtors Turnover Ratio Times 3.41 3.15
Current Ratio Times 6.16 5.93
Debt Equity Ratio Times 0.00 0.00
Net profit Margin % 21.11% 19.86%
Return on Net worth % 11.37% 10.01%

20. RISK MANAGEMENT:

There are no changes in the risk perception and mitigation strategies compared toprevious years. However the comments on the added risk due to pandemic is are given inthe earlier sections.

The Company has developed and adopted a Risk Management Policy that ensures theappropriate management of risks in line with its internal systems and culture. The Companyperceives risk management as a means of value optimization. The Company also recognizesthe importance of internal controls and risk management in sustaining business continuity.The company endeavours to make risk management and control essential components of thebusiness environment exposed to different modalities of risks arising from internal andexternal sources. Risks are assessed department-wise such as financial risks informationtechnology-related risks legal risks accounting fraud etc. It further assists the Boardin fulfilling its corporate governance oversight responsibilities about identifyingevaluating and mitigating operational strategic and external environment risks.

The details of the Committee and its terms of reference are set out in the CorporateGovernance Report forming part of this report.

The following elements of risks can impact the performance of the Company.

1. Industry : With the movement to Cloud and mobility ABM will have to tweak itsofferings by making necessary sales and solution strategy changes. These efforts beganlast year.

2. Supply side risk for talent acquisition : The IT industry is characterized byits constant supply constraints due to technological advancements as well as personalgrowth sought by the employees. With a growing customer base and mission-criticalprojects the unavailability of the right skilled resources at right time in the rightquantity can pose a risk.

ABM has adopted a strategy of taking fresh graduates and training them specifically fortechnologies and domain-specific to ABM. Further the Company constantly trains andre-trains existing resources for different skills and technologies. Suitable HR practicesare adopted to minimise the attrition rate. Lateral hiring is done to bring in freshleaders.

Under COVID-19 remote onboarding of new employees may pose minor risk of integratingthe new employees in ABM culture and practices. HR dept. is designing the onboardingprocess keeping this constraint in mind.

3. Operational efficiency : The operational risk is mainly associated with clientacquisition execution of projects information security and continuity of customer'sbusiness operations. The Company has project-level monitoring where such risks areidentified and escalated to the board for suitable corrective measures on time.

Security measures for WFH employees have been implemented for safe access of ABMservers. In addition employees are regularly updated on the cyber risks and care to betaken while using remote access.

4. Reputation : The Company's projects are in the Government sector which isnecessarily funded by public finance. This aspect may expose the Company to the risk ofmotivated public scrutiny from elements that are adversely affected by the success of theproject leading to transparency and sometimes by competition. The Company strictlyfollows the Govt. processes of procurement. It executes the projects with the highestpossible standards of ethics and best industry processes. Employees are made well aware ofthe company policy and ensure the proper code of conduct is followed across projectsuniformly. The Company has published its code of conduct for the benefit of employees.This has been helping the Company so far to win over the confidence of customers even insituations of motivated public scrutiny which is aimed at hurting the reputation of theCompany.

21. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTSRELATE ANDTHE DATE OFTHE REPORT:

There are no planned material changes or commitments made by Company that will affectthe Company's financial position during the period mentioned above. The liquid cashavailable with the Company may also be utilized if the plans for acquisition fructify.

22. CODE OF CONDUCT :

The Company has adopted the Code of Conduct and ethics for all Board Members and SeniorManagement and this is strictly adhered to. A copy of the Code of Conduct is available onthe website of the Company www.abmindia.com. In addition members of the Board and SeniorManagement also submit on an annual basis the details of individuals to whom they arerelated and entities in which they hold interest and such disclosures are placed beforethe Board. The members of the Board inform the Company of any change in theirdirectorship(s) chairmanship(s) / membership(s) of the Committees in accordance with therequirements of the Companies Act 2013 and Listing Regulations.

The members of the Board and Senior Management have affirmed their compliance with thecode and a declaration signed by the Managing Director is annexed to this report.

23. AUDIT COMMITTEE COMPOSITION :

The Composition of the Audit Committee is as per Section 177 of the Companies Act 2013and the Listing Regulations and is as described in the Corporate Governance Report whichforms part of this report. The Constitution meetings attendance and other details of theAudit Committee are given in the Corporate Governance Report which is part of the Report.During the year all the recommendations of the Audit Committee were accepted by the Board.

24. VIGIL MECHANISM :

Pursuant to the provisions of Section 177(9) of the Act and rules made thereunder theBoard of Directors had approved the Policy on Vigil Mechanism / Whistle Blower Policy toprovide a mechanism for the Directors and employees to report their grievances genuineconcerns about unethical behaviour actual or suspected fraud and violation of theCompany's Code of Conduct. This Policy inter-alia provides a direct access to the Chairmanof the Audit Committee.

Brief details about the policy are provided in the Corporate Governance Report attachedto this Report. The Whistle Blower Policy is available on the website of the Company.

25. PREVENTION OF INSIDERTRADING :

As per SEBI (Prohibition of Insider Trading) Regulation 2015 the Company has in placea Code of Conduct to Regulate Monitor and Report Trading by Insiders the disclosurerequirements and procedure thereto. The Company endeavours to preserve the confidentialityof Unpublished Price Sensitive Information and to prevent misuse of such information. Withrespect to this the Company has also developed a Code for Procedure for Inquiry in caseof Leak of Unpublished Price Sensitive Information. This code is prepared in accordancewith Regulation 9(1) and Schedule B of the SEBI (Prohibition of Insider Trading)Regulation 2015 as amended by SEBI (Prohibition of Insider Trading) (Amendment)Regulation 2020. The Company regularly reminds the Employees about their obligation underthe policies and also informs about prevention of insider trading into the securities ofthe Company.

The Company Secretary is responsible for implementation of the Code. All Board ofDirectors and the designated employees have confirmed compliance with the Code.

26. RELATED PARTY TRANSACTIONS :

In line with requirement of the Companies Act 2013 and amendment to the ListingRegulations your Company has formulated a revised Policy on Related Party Transactionswhich is also available at Company's website www.abmindia.com. The Policy intends toensure that proper reporting approval and disclosure processes are in place for alltransactions between the Company and Related Parties.

All related party transactions are placed before the Audit Committee for approval.Prior omnibus approval of the Audit Committee is obtained on an annual basis which isreviewed and updated on quarterly basis.

All Related Party Transactions entered during the year were in Ordinary Course of theBusiness and on Arm's Length basis. No Material Related Party Transactions i.e.transactions exceeding ten percent of the annual consolidated turnover as per the lastaudited financial statements were entered during the year by your Company. Accordinglythe disclosure of Related Party Transactions as required under Section 134(3) (h) of theCompanies Act 2013 in Form AOC-2 is not applicable.

27. ANNUAL RETURN :

As required pursuant to Section 92(3) read with Section 134(3)(a) of the Act theAnnual Return of the Company as on 31st March 2021 is available on the Company's websiteon ttps://abmindia.com//uploads/Final%20Category%20wise/20210719161033 ABM Annual Return2020-2021.pdf.

28. CORPORATE SOCIAL RESPONSIBILITY :

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 of this report in the format prescribed in the Companies (Corporate SocialResponsibility Policy) Rules 2014. In compliance with requirements of Section 135 of theCompanies Act 2013 the Company has laid down a CSR Policy which is published on itswebsite www.abmindia.com.

29. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS :

There were no loans or guarantees given by the Company under Section 186 of theCompanies Act 2013 during the year under review. The Particulars of investments have beendisclosed in the Financial Statements.

30. PREVENTION OF SEXUAL HARASSMENT (POSH) AT WORKPLACE :

The Company is committed to ensuring that all employees work in an environment that notonly promotes diversity and equality but also mutual trust equal opportunity and respectfor human rights. The Company is also committed to provide a work environment that ensuresevery employee is treated with dignity respect and afforded equal treatment.

The Company has adopted a Policy for prevention of Sexual Harassment in line with therequirements of the Sexual Harassment of Women at Workplace (Prevention Prohibition &Redressal) Act 2013 and rules thereunder. The Company has also formed an "InternalComplaints Committee" for prevention and redressal of sexual harassment at workplace.While maintaining the highest governance norms the Company has appointed externalindependent person who works in this area and has the requisite experience in handlingsuch matters as member of Internal Complaints Committee. The Company has ensured a widedissemination of the Policy and have conducted various offline training sessions andawareness programmes for all employees across the Company. The Company has not receivedany complaint of sexual harassment during the financial year 2020-2021.

31. PARTICULARS OF EMPLOYEES :

Disclosures with respect to the remuneration of Directors and employees as requiredunder Section 197 of Companies Act 2013 and Rule 5 (1) Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 have been appended as Annexure to thisReport. Details of employee remuneration as required under provisions of Section 197 ofthe Act and Rule 5(2) and 5(3) of the Rules is provided in a separate annexure formingpart of this report. Further the report and the accounts are being sent to the membersexcluding the aforesaid annexure. In terms of Section 136 of the Act the said annexure isopen for inspection at the Registered Office of the Company. Any shareholder interested inobtaining a copy of the same may write to the Company Secretary.

32. CONSERVATION OF ENERGY:

Your Company consumes energy mainly for the operation of its software development thusthe consumption of electricity is negligible. In order to conserve the electricity theair conditioners are kept at a moderate temperature and all the electrical equipments aretu rned off whenever they are not required by the office staff.

33. TECHNOLOGY ABSORPTION ADOPTION & INNOVATION AND RESEARCH AND DEVELOPMENT :

ABM has identified areas focus such as Cloud adoption for the flagship productoffering some of products on SaaS mprovement in UI / UX Improving operation efficiencyby implementing Dev Ops practice and Process for harnessing new technologies. Investmentsproposed in last year in these areas could not be done fully and these efforts willcontinue during the current year also.

34. FOREIGN EXCHANGE EARNINGS AND OUTGO :

Your company did not have any Foreign Exchange earnings or outgo in last year.

35. LISTING FEES :

Your Company's shares are listed in The Bombay Stock Exchange Limited Mumbai and theAnnual Listing fees for the year under review have been paid.

36. DIRECTORS' RESPONSIBILITY STATEMENT :

The Directors hereby confirm that:

a) in the preparation of the annual accounts the applicable accounting standards havebeen followed and that no material departures have been made from the same;

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 Profitor 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 Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

d) they have prepared the Annual Accounts on a going concern basis;

e) they have laid down internal financial controls for the Company and such internalfinancial controls are adequate and operating effectively; and

f) they have devised proper system to ensure compliance with the provisions of allapplicable laws and such systems are adequate and operating effectively.

37. ACKNOWLEDGEMENT :

The Board express their deep sense of gratitude to all Shareholders BusinessAssociates Clients Vendors Banks Financial Institutions Central and State GovernmentOrganizations Regulatory Authorities for their continued co-operation and support whichwas a great help to us in managing our continued growth. We acknowledge theircontributions and commit ourselves to continue and strengthen this fruitful alliance inall times to come.

Your Directors place on record their deep appreciation to employees at all levels fortheir hard work dedication and commitment in particular during this unprecedented year.We applaud them for their superior level of competence enthusiasm and unstinting effortswhich have enabled the Company to remain an innovative leader in Software & Servicessegment of Indian IT Industry.

For and on behalf of the Board
Sd/ - Sd/ -
Date : 25th June 2021 Prakash B. Rane Sharadchandra D. Abhyankar
Place: Mumbai Managing Director Director
(DIN: 00152393) (DIN: 00108866)

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