To the Members of Aurionpro Solutions Limited
The Directors present Twenty Third Annual Report of the Company together with itsaudited financial statements for the year ended 31 March 2020.
1. FINANCIAL STATEMENT
The highlights of the Standalone Financial Statement are as under:
| || ||(Rs In lakhs) |
|Particulars ||31 March 2020 ||31 March 2019 |
|Income || || |
|Revenue from Operations ||26630.54 ||33188.57 |
|Other Income ||1107.27 ||2454.58 |
|Total Income ||27737.81 ||35643.15 |
|Expenses || || |
|Operating Expenses ||10715.34 ||18191.41 |
|Change in Inventories of Raw Material Finished Goods and Stock-in-Trade ||1032.79 ||(1385.03) |
|Employee Benefits Expense ||8336.02 ||7574.47 |
|Finance Costs ||1598.43 ||1026.09 |
|Depreciation and Amortisation Expense ||1469.26 ||975.17 |
|Other Expenses ||2957.59 ||4364.71 |
|Total Expenses ||26109.43 ||30746.82 |
|Profit Before Tax ||1628.38 ||4896.33 |
|Tax Expense: || || |
|(a) Current tax ||520.85 ||1596.37 |
|(b) Deferred Tax Charge/ (Credit) ||78.93 ||(392.82) |
|Profit After Tax ||1028.60 ||3692.78 |
|Other Comprehensive Income (net of tax) ||(84.54) ||(56.47) |
|Total Comprehensive Income ||944.06 ||3636.31 |
The highlights of the Consolidated Financial Statement are as under:
| || ||( Rs In lakhs) |
|Particulars ||31 March 2020 ||31 March 2019 |
|Income || || |
|Revenue from Operations ||45502.04 ||52215.08 |
|Other Income ||978.79 ||726.81 |
|Total Income ||46480.83 ||52941.89 |
|Expenses || || |
|Operating Expenses ||14512.31 ||19531.21 |
|Change of Inventories of Raw Material Finished Goods and Stock-in-Trade ||764.94 ||(1345.70) |
|Employee Benefits Expense ||16691.19 ||16387.89 |
|Finance Costs ||1826.42 ||1191.43 |
|Depreciation and Amortisation Expense ||4219.75 ||3098.84 |
|Other Expenses ||5079.15 ||6560.87 |
|Total Expenses ||43093.76 ||45424.54 |
|Profit before Share of Profit of Associates Exceptional Items and Tax ||3387.07 ||7517.35 |
|Share of Profit of Associates ||40.78 ||47.25 |
|Profit before Exceptional Items and Tax ||3427.85 ||7564.60 |
|Less: Exceptional Item ||- ||- |
|Profit Before Tax ||3427.85 ||7564.60 |
|Tax Expense: || || |
|(a) Current Tax ||428.21 ||1629.11 |
|(b) Deferred Tax Credit ||(169.46) ||(136.44) |
|Profit After Tax ||3169.10 ||6071.93 |
|Other Comprehensive Income (net of tax) ||(25.75) ||(16.09) |
|Total Comprehensive Income ||3143.35 ||6055.84 |
2. MATERIAL CHANGES & COMMITMENTS
The pandemic caused due to novel corona virus ("COVID-19") has impacted theeconomies across the globe. The Board has assessed the impact of COVID-19 on thebusinesses and there is no impact as of the balance sheet date. The Company continues toprovide the services to its customers with some disruptions on account of lock-downs andother restrictions imposed in various geographies. The Company has put in place plans tominimize the adverse impact on both revenue and profitability.
There are no other material changes or commitments affecting the financial position ofthe Company between the end of the financial year and the date of the report.
3. DIVIDEND AND RESERVES
The Company has consistent track record of payment of dividend. However in the wake ofeconomic uncertainties and disruptions caused by the COVID-19 the Board of Directors feltit appropriate to conserve its resources in order to meet any unforeseen contingencies.Therefore the Board of Directors do not recommend any dividend for the financial 2019-20.
The profit after tax for the year ended 31 March 2020 was Rs 1028.60 lakhs and thesame has been transferred to the Retained Earnings.
4. STATE OF COMPANY'S AFFAIRS
The subdued performance during FY 20 was largely attributed to the externaluncertainties amid general elections and resultant slowdown in the domestic market duringthe H1 and disruptions caused globally due to the COVID-19 pandemic in Q4 of the FY 20.The banking sector in general has been facing headwinds and consolidation at PSU banks hadslowed down the new business in the Banking & Fintech space. In spite of thesechallenges we could register growth in this segment.
The Smart City and Smart Mobility segment witnessed sharp decline which was largely dueto the constrained spending capacity of the governments in the wake of general electionsand funds crunch due to the general economic downturn in the domestic markets. Theclientele in this segment includes various governments and governmental undertakings. Theoutlook for this segment remains optimistic as the governments are expected to ramp upinfrastructure spending in order to boost economic activities and have also expandedfiscal space for this purpose.
On Cyber Security space we completed a round of investment in Cyberinc during FY20which also went live with ISLA 5.1. We are also building partnerships and distributionnetwork which is critical to boost the business. The outlook for this segment remainspositive as businesses are expected to invest aggressively to ramp up IT infrastructure& security within the organizations.
However the fundamentals of all our businesses remain strong and we do not foresee anysignificant impact of the pandemic and economic disruptions caused thereby on thebusinesses of the Company.
During the year no further capital was raised by the Company. The Company with anobjective to retain and attract talent in the organization had launched Employee SharePurchase Scheme 2017 (ESPS 2017') during the year 2017-18. The ESPS 2017 has beenframed and implemented in compliance with the SEBI (Share Based Employee Benefits)Regulations 2014.
During the year the Company did not allot shares under the Scheme. Below are thedetails of the shares issued and allotted under the ESPS 2017 as on the date of thisReport are as under:
|Particulars ||Outstanding Shares |
|Total Number of Shares for which In principle approval received from the stock exchanges in the year 2017-18 ||1151765 |
|Number of Shares available for further grant at the beginning of the year 2019-20 ||550765 |
|Less : Number of Shares allotted during the FY 2019-20 ||Nil |
|Number of Shares available for further Grant ||550765 |
6. SUBSIDIARIES/ JOINT VENTURES/ASSOCIATE COMPANIES
During the year Aurionpro Solutions Pte Ltd. a wholly owned subsidiary of AurionproSolutions Limited (Aurionpro') has completed acquisition of majority stake (51%) inSC Soft Pte. Ltd. ("SC Soft") a Singapore headquartered Automated FareCollection ("AFC") and smart city solution provider. As on the date of thisReport Aurionpro Solutions Pte Ltd. holds 1770000 shares representing 51% stake in SCSoft. The acquisition of SC Soft is a strategic milestone which has strengthened theposition of Aurionpro in the rapidly growing AFC Market and has established Aurionpro as aone stop shop having necessary end to end hardware and software required for theimplementation of the AFC Systems.
Further Aurionpro Solutions Pte Ltd. a wholly owned subsidiary of Aurionpro alsocompleted acquisition of 100% stake in Neo.Bnk Pte. Ltd. a Singapore based technologyfirm focused on developing micro services based open banking platform.
Pursuant to the provisions of Section 129(3) of the Companies Act 2013 ("theAct") a statement containing the salient features of financial statements of theCompany's subsidiaries in Form No. AOC-1 is attached to the financial statements of theCompany.
During the year Servopt Consulting Private Limited a wholly owned subsidiary of theCompany has initiated process for its striking off and final order is awaited.
7. ANNUAL RETURN
The extract of the annual return as annexed to this report as Annexure -1. In additionto extract of annual return the copy of the annual return will be available on thewebsite of the Company i.e. www.aurionpro.com.
8. CORPORATE GOVERNANCE
The Report on corporate governance as per the requirements of Regulation 34 of theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 ("the LODR") forms part of this Annual Report. Further therequisite certificate from M/s. Milind Nirkhe & Associates Practicing CompanySecretaries confirming the compliance with the conditions of corporate governance hasbeen included in the said Report.
9. MANAGEMENT DISCUSSION AND ANALYSIS (MDA)
10. CORPORATE SOCIAL RESPONSIBILITY (CSR)
In accordance with the provisions of Section 135 read with Schedule VII of the Act theCompany has adopted a CSR Policy outlining various CSR activities to be undertaken by theCompany.
The CSR Policy of the Company is available on the website of the Company atwww.aurionpro.com.
During the year under review the Company has contributed Rs 54 lakhs (Fifty Fourlakhs) to the trust which is engaged in the area of Education hostel for students Womanwelfare and empowerment vocational training health awareness etc.
The Board has constituted a CSR committee' which comprises of followingdirectors: Mr. Amit Sheth - Chairman Dr. Mahendra Mehta - Member Mrs. Sudha Bhsuhan -Member
The CSR Committee inter alia determines the budget for funding various charitableactivities and the recommends the contributions to be made to various initiatives.
The disclosures as required under Rule 9 of the Companies (Corporate SocialResponsibility Policy) Rules 2014 has been enclosed to this Report as "Annexure2".
11. INTERNAL CONTROL SYSTEM & THEIR ADEQACY
The Company has an internal control system which commensurate with the size scale andnature of its operations. The Internal Audit Team monitors and evaluates the efficacy andadequacy of internal control system in the Company its compliance with operating systemsaccounting procedures and policies of the Company.
12. DIRECTOR'S RESPONSIBILITY STATEMENT
In terms of the provisions of Section 134(3)(c) of the Act the Board confirms that:
i) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures if any;
ii) the Directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year 31March 2020 and of the profit and loss of the Company for that period;
iii) the Directors had 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;
iv) the Directors had prepared the annual accounts on a going concern basis;
v) the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively;
vi) the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
13. DIRECTOR'S/KEY MANAGERIAL PERSONNEL (KMP)
None of the directors of the Company is disqualified under the provisions of theAct or under the LODR. All Independent Directors have provided confirmations ascontemplated under section 149(7) of the Act.
Re-appointment on account of retirement by rotation
In accordance with the provisions of the Act and Articles of Association of thecompany Mr. Ajay Sarupria retires by rotation and being eligible offers himself forre-appointment.
Re-appointment of Independent Director
The first term of Mr. Frank Osusky as an Independent Director expires on 21 September2020.
The Board is of the opinion that Mr. Frank Independent Director possesses requisitequalification experience expertise and holds high standards of integrity. Based onrecommendation of the Nomination and Remuneration Committee The Board has approved andrecommended his re-appointment as an Independent Director for second term of five yearssubject to the approval of the Members.
All Independent Directors have given declarations afirming that they meet the criteriaof independence as laid down under Section 149(6) of the Act and Regulation 16(1)(b) ofthe LODR.
The information as required to be disclosed under regulation 36 of the LODR and briefprofile of directors in case of appointment/ reappointment of director is incorporated inexplanatory statement of AGM Notice forming part of the Annual Report.
Key Managerial Person
Mr. Hemant Chopra has resigned from the post of Chief Financial Officer of the Companywith effect from 12 June 2020 due to his personal priorities concerning health and desireto pursue other professional aspirations.Mr. Vipul Parmar appointed as a new ChiefFinancial Officer of the Company with effect from 29 June 2020.
Pursuant to the provisions of Section 203 of the Act as on the date of this Report theKey Managerial Personnel of the Company comprised of Mr. Paresh Zaveri Chairman andManaging Director Mr. Vipul Parmar Chief Financial Officer and Mr. Ninad Kelkar CompanySecretary.
14. PERFORMANCE EVALUATION
The Company's policy relating to the appointment and remuneration of Directors KMPsand other employees including criteria for determining qualifications positive attributesand independence of Directors are covered under the Corporate Governance Report whichforms part of this Annual Report.
The Board of Directors annually evaluate its own performance and that of its committeesand individual Directors.
The Board has formulated the Nomination and Remuneration Policy for selection andappointment of Directors senior management personnel and their remunerations. This policyis available at the Company's website www.aurionpro.com.
During the year under review the Board met four times and the gap between two meetingsdid not exceed 120 days. For details of meetings of the Board please refer to theCorporate Governance Report which is part of this report.
As on the date of this report the Board has four committees applicable under the LODR:
i) Audit Committee; ii) Nomination and Remuneration/Compensation Committee; iii)Stakeholder Relationship/Investor Grievance and Share Transfer Committee; and iv)Corporate Social Responsibility Committee.
The detailed information in relation to these committees including composition and theterms of reference and other details are provided in Corporate Governance Report.
17. VIGIL MECHANISM/ WHISTLE BLOWER POLICY
The Company has established the necessary vigil mechanism and has put in place aWhistle Blower policy' in order to enable the employees and Directors of the Companyto report their concerns about the management operations and other affairs of theCompany. In terms of the Whistle Blower Policy the whistle blowers are provided an accessto the Audit Committee to lodge their concerns. This policy is available on the website ofthe Company at www.aurionpro.com.
18. RISK MANAGEMENT POLICY
The Company has formulated a comprehensive Risk Management Policy to identify assessand mitigate various risks associated with the Company. This policy is available on thewebsite of the company at www.aurionpro.com.
19. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE ACT
The details of loans guarantees and investments covered under the provisions ofSection 186 of the Act are given under the note no.40 to the standalone financialstatements forming part of this annual report.
20. PARTICLUARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All the related party transactions entered into during the financial year were on anarm's length basis and were in the ordinary course of business. During the financial yearthe Company has not entered into any contract/arrangement transactions with relatedparties which could be considered material in accordance with the policy of the Company asto related party transactions. The details of all related party transactions are placedbefore the Audit Committee for approval. The policy as to Related Party Transactions asapproved by the Board is available on the Company's website at www.aurionpro.com.
The details of transactions entered into with the related parties are disclosed in thenotes to the stand-alone financial statements forming part of this Annual Report.
21. PUBLIC DEPOSITS
During the year the Company has neither invited nor accepted any public deposits.
22. REPORTING OF FRAUD BY AUDITORS
The Statutory Auditors of the Company has stated in their report that during thecourse of Audit no fraud on or by the Company has been noticed or reported.
23. SECRETARIAL AUDIT
The Secretarial Audit was carried out by M/s. Milind Nirkhe & Associates CompanySecretary in Practice. The Report of the Secretarial Audit is annexed herewith as"Annexure 3". We refer to the observation in the said report regardingappointment of Independent Director under Regulation 24(1) of the LODR on the Board ofCyberinc an Unlisted Material Subsidiary incorporated outside India.
In this connection the Board wishes to respond that Cyberinc had recently concludedfunding round and had roped in new investor by issuance of preferred stock / warrants.Post the funding round Cyberinc is in the process of reconstituting its Board and theprovisions of Regulation 24(1) of the LODR shall be complied with.
24. PARTICLUARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Act read with the Rules 5(2) and5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014a statement showing the names and other particulars of the employees drawing remunerationin excess of the limits set out in the said rules is provided in a separate annexureforming part of this Report. Having regard to the provision of the first proviso toSection 136(1) of the Act the Annual Report excluding the aforesaid information is beingsent to the Members of the Company. In terms of Section 136 the said annexure is open forinspection. Any Member interested in obtaining a copy of the same may write to the CompanySecretary.
The disclosures pertaining to the remuneration and other details as required undersection 197(12) of the Act read with Rule 5(1) of the of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 have been provided in the Annual Reportas "Annexure 4".
25. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO
In terms of section 134(3)(m) of the Act read with rule 8 of the Chapter IX of theCompanies (Accounts) Rules 2014 the Directors furnish herein below the requiredadditional information:
Conservation of Energy:
Although the operations of the Company are not energy intensive the management ishighly conscious of the criticality of the conservation of energy at all operationallevels. The requirement of disclosure of particulars with respect to conservation ofenergy as prescribed in Section 134(3)(m) of the Act read with Rule 8(3) of the Companies(Accounts) Rules 2014 is not applicable to the Company and hence are not provided.
The Company continues to adopt latest technologies and innovations for improving theproductivity and quality of its products and service offerings. The Company is alsopartnering with major technology providers in global markets.
Foreign Exchange Earnings and Outgo:
The details of foreign exchange earned and spent by the Company during the year aregiven below:
|Earnings in Foreign Currency || || |
| || ||Rs ( In lakhs) |
|Particulars ||31 March 2020 ||31 March 2019 |
|Revenue From Operations ||4062.32 ||4431.54 |
|Interest and Other Income ||164.11 ||1802.38 |
|Total ||4226.43 ||6233.92 |
Expenditure in Foreign Currency
(Rs In lakhs)
|Particulars ||31 March 2020 ||31 March 2019 |
|Software Hardware and Other Material Cost ||558.40 ||3261.32 |
|Travelling Conveyance and Other Expenses ||140.28 ||193.36 |
|Total ||698.68 ||3454.68 |
26. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
The Company has in place necessary policy as required under the Sexual Harassment ofWomen at the Workplace (Prevention Prohibition & Redressal) Act 2013. The InternalComplaints Committee (ICC) has been set up to redress complaints received regarding sexualharassment. All employees (permanent contractual temporary trainees) are covered underthis policy. During the year under review the Company has not received any complaintsunder the policy.
27. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators / Courts whichwould impact the going concern status of the Company and its future operations.
28. COST RECORDS
The Company is not required to maintain cost records specified by Central Governmentunder section 148(1) of the Act.
29. DISCLAIMER AND FORWARD-LOOKING STATEMENT
The statements in the Board's Report and the Management Discussion & Analysisdescribing the Company's objectives expectations or forecasts may be forward-lookingwithin the meaning of applicable securities laws and regulations. Actual results maydiffer materially from those expressed in the statement. Important factors that couldinfluence the Company's operations include global and domestic demand and supply inputcosts availability changes in government regulations tax laws economic developmentswithin the country and other factors such as litigation and industrial relations.
The Directors would like to place on record their sincere appreciation for thecontinued co-operation support and assistance provided by all the stakeholders includingCompany's employees the financial institutions banks customers vendors members andother government departments and authorities.
For and on behalf of the Board of Directors
|Paresh Zaveri |
|Chairman & Managing Director |
|Place : Navi Mumbai |
|Date : 29th June 2020 |
|Registered Office: |
|Synergia IT Park Plot No. R-270 |
|T.T.C. Industrial Estate Near Rabale |
|Police Station Rabale Navi Mumbai -400701. |