Your directors have pleasure in presenting the 30th Annual Report on the business of your Company together with the Audited Statements of Accounts for the financial year ended 31stMarch 2020.
1. COMPANY PERFORMANCE:
Your Company's performance during the year ended 31st March 2020 as compared to the previous financial year is summarized as below:
|(Rs. In Lakhs)|
|PARTICULARS||Financial Year2019-20||Financial Year2018-19|
|Revenue from Operations||5191.93||5051.12|
|Net Profit/Loss Before Tax (PBT)||1301.25||1250.03|
|Provision for Tax|
|Net Profit (PAT)||1075.74||958.92|
|Other Comprehensive Income (net Tax)||(17.23)||(8.13)|
|Total Comprehensive Income||1058.51||950.79|
During the financial year 2019-20 the company has recorded a Profit before Tax of Rs.13.01 crores as against Rs.12.50 crores in the previous year with a marginal increase in profit as compared to previous financial year.
2. TRANSFER TO RESERVES
The Board of Directors of the Company has not recommended for transfer of any amount to the General Reserve for the Financial Year ended March 31 2020.
Your Directors recommended a final dividend of Rs. 2/- per share for the financial year 2019-20. The dividend payout is subject to the approval of the members at the ensuing Annual General Meeting. During the Financial Year 2019-20 the company has declared an interim dividend of Rs.2/- per equity share to the members of the company. A table containing the details of the dividend is mentioned below:
|Particulars||Dividend (in Rs.)|
* Recommended by the Board of Directors at the meeting held on 9th May 2020. The payment is subject to the approval of the Shareholders at the ensuing Annual General Meeting scheduled to be held on 25th June 2020.
* The Dividend will be paid to members whose names appear in the register of members as on Thursday the 18th day of June 2020 and in respect of shares held in dematerialised form it will be paid to the members whose names are furnished by NSDL and CDSL as beneficial owners as on that date
4. DIRECTORS & KEY MANAGERIAL PERSONAL:
In accordance with the provisions of Section 152 of the Companies Act 2013 and the Articles of Association of the company Dr. Abburi Vidyasagar(DIN: 00026524) Director retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment. The Board recommends the reappointment of Dr. Abburi Vidyasagar (DIN: 00026524) for the consideration of the members of the company at the ensuing annual general meeting. Brief details of Dr. Abburi vidyasagar (DIN: 00026524) has been mentioned in the notice convening the Annual General Meeting at Information pursuant to the Listing Regulations and Secretarial Standards in respect of Appointment/ Re-appointment of Directors.
The tenure of Smt. Abburi Sarada (DIN : 00026543) Whole Time Director and Chief Financial Officer (CFO) of the company expired on 13th May 2020. Taking in to consideration of her rich experience and contribution to the Company and pursuant to the recommendation of the Nomination and Remuneration Committee the Board of Directors of the Company subject to the approval of the members at the ensuing AGM passed a resolution on 9th May 2020 recommending the reappointment of Mrs. Abburi Sarada (DIN : 00026543) as Whole-time Director of the Company for a further period of two years with effect from 14th May 2020 to 13th May 2022.
5. DECLARATION BY INDEPENDENT DIRECTORS
The Company has received necessary declarations from each Independent director under 149(7) of the Companies Act 2013that he meets the criteria of Independence laid down under section 149(6) of the Companies Act 2013.
6. MEETINGS OF THE BOARD
The Board met Six times during the financial year 2019-20 viz. on 07.05.2019 12.07.2019 10.10.2019 06.11.2019 17.01.2020 and 12.02.2020.The maximum interval between any two meetings did not exceed 120 days.
7. STATUTORY AUDITORS:
M/s. Ramanatham & Rao Chartered Accountants were appointed as the statutory auditors of the company at the 29th Annual General Meeting (AGM) held on July12 2019 to hold office as such till the conclusion of the 31st Annual General Meeting of the company. Hence the term of the said Statutory Auditors shall expire at the 31st Annual General Meeting of the company to be held in the year 2021.
8. AUDITORS' REPORT
There are no qualifications reservations or adverse remarks made by M/s. Ramanatham & Rao. Chartered Accountants Statutory Auditors in their report for the Financial Year ended 31st March 2020. The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company under subsection (12) of section 143 of the Companies Act 2013 during the year under review.
9. INTERNAL AUDITORS:
The Board of Directors based on the recommendation of the Audit Committee has re-appointed M/s. Ramesh & Co. Chartered Accountants Hyderabad as the Internal Auditors of your Company. The Internal Auditors are submitting their reports on quarterly basis.
10. SECRETARIAL AUDITORS:
M/s. P.S. Rao & Associates Practising Company Secretaries were appointed to conduct the Secretarial Audit of the Company for the financial year 2019-20 as required under Section 204 of the Companies Act 2013 and Rule 9 there-under. The secretarial audit report for F.Y. 2019-20 forms part of this Report as Annexure- I.
11. SECRETARIAL AUDIT REPORT
There are no qualifications reservations or adverse remarks made by M/s. P. S. Rao & Associates Practising Company Secretaries in their report for the Financial Year ended 31st March 2020.
12. RISK MANAGEMENT POLICY
The Company has developed and is implementing a risk management policy which includes the identification therein of elements of risk which in the opinion of the board may threaten the existence of the Company.
13. CORPORATE SOCIAL RESPONSIBILITY (CSR):
As part of the Corporate Social Responsibility initiative the Company has spent an amount of ` 1570000/- (Rupees Fifteen Lakhs Seventy Thousand Only)towards the various CSR activities during the financial year 2019-20.A report on CSR Activities as required under Rule 9 of the Companies (Corporate Social Responsibility) Rules 2014 is enclosed herewith as Annexure - II.
The Company has adopted Corporate Social Responsibility Policy in line with Schedule-VII of Companies Act 2013 containing the activities to be undertaken by the Company as part of its CSR programs. The CSR Policy is disclosed on the website of the Company www.avantel.in.
Composition of Corporate Social Responsibility Committee:
|Smt. A Sarada||- Chairperson|
|Shri. N Naveen||- Member|
|Shri. Y Kishore||- Member|
|Shri Durga Prasad||- Member (Non-Board Member)|
14. COMPOSITION OF AUDIT COMMITTEE:
The Audit Committee of the Company comprises the following Members
|Shri. N. Naveen||- Chairman|
|Shri. Y. Kishore||- Member|
|Shri. Raghu Prasad Pidikiti||- Member|
|Shri. E.B.V. Ramana Gupta||- Member|
|Shri. M. Narayana Rao||- Member|
All the recommendations made by the Audit Committee of the Company have been considered and accepted by the Board of Directors of the Company.
15. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE OUTGO:
Information required under section 134(3) (m) of the Companies Act 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 is enclosed herewith as Annexure- III.
16. FORMAL ANNUAL EVALUATION OF PERFORMANCE OF THE MEMBERS OF THE BOARD AND COMMITTEES
One of the key functions of the Board is to monitor and review the board evaluation framework. The Board works with the nomination and remuneration committee to lay down the evaluation criteria for the performance of executive/non-executive/independent directors through a peer-evaluation excluding the director being evaluated through a Board effectiveness survey. The questionnaire of the survey is a key part of the process of reviewing the functioning and effectiveness of the Board and for identifying possible paths for improvement. Each Board member is requested to evaluate the effectiveness of the Board dynamics and relationships information flow decision-making of the directors relationship to stakeholders company performance company strategy and the effectiveness of the whole Board and its various committees on a scale of one to five. Feedback on each directoris encouraged to be provided as part of the survey.
Independent directors have three key roles:
- governance control and guidance. Some of the performance indicators based on which the independent directors are evaluated include:
Ability to contribute by introducing international best practices to address top-management issues
Active participation in long-term strategic planning
Commitment to the fulfillment of a director's obligations and fiduciary responsibilities; these include participation in Board and committee meetings.
A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board who were evaluated on parameters such as level of engagement and contribution independence of judgment safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Directors who also reviewed the performance of the Secretarial Department. The Directors expressed their satisfaction with the evaluation process.
17. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:
The Company has in place an Internal Control System commensurate with the size scale and complexity of its operations. During the year such controls were tested and no reportable material weaknesses in the design or operation were observed.
18. SUBSIDIARIES/ASSOCIATES COMPANIES/ JOINT VENTURES:
The Company has no Subsidiaries/ Associate Companies/ Joint Ventures as on 31st March 2020.
19. NOMINATION AND REMUENRATION POLICY:
A committee of the Board named as Nomination and Remuneration Committee has been constituted to comply with the provisions of section 178 of Companies Act 2013 and Regulation 19 of SEBI (LODR) Regulations 2015 to recommend a policy of the Company on directors' appointment and remuneration including criteria for determining qualifications positive attributes independence of a director and other matters and to frame proper systems for identification appointment of Directors & KMPs Payment of Remuneration to them and Evaluation of their performance and to recommend the same to the Board from time to time. The policy is also posted in the investors section of the company's website.
20. FIXED DEPOSITS:
Your Company has not accepted any fixed deposits and as such no principal or interest was outstanding as on the date of the Balance sheet.
21. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
Details of the Loans guarantees and investments covered under Section 186 of the Companies Act 2013 if any are given in the notes to the financial statements pertaining to the year under review.
22. POLICY ON SEXUAL HARASSMENT:
The company has adopted policy on prevention of sexual harassment of women at workplace in accordance with The Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.
During the financial year ended 31st March 2020 the company has not received any complaints pertaining to sexual harassment.
23. DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to Section 134 (5) of the Companies Act 2013 Your Directors' confirm that:
i) In preparation of annual accounts for the financial year ended 31st March 2020 the applicable Accounting Standards have been followed along with proper explanation relating to material departures;
ii) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year ended 31stMarch 2020 and of the profit and loss of the Company for the year;
iii) The Directors have taken proper and sufficient care for their maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
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 the company and that such internal financial controls are adequate and are operating effectively; and
vi) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
24. VIGIL MECHANISM:
The Company has a Whistle Blower Policy framed to deal with instance of fraud and mismanagement if any in the Company. The details of the Policy are posted on the website of the Company www.avantel.in on the following link http://www.avantel.in/inversteinfo.php
25. RELATED PARTY TRANSACTIONS:
Related party transactions entered during the financial year under review are disclosed in Note No. 36 of the Financial Statements of the Company for the financial year ended 31st March 2020. These transactions entered were at an arm's length basis and in the ordinary course of business. There were no materially significant related party transactions with the Company's Promoters Directors Management or their relatives which could have had a potential conflict with the interests of the Company. Form AOC-2 containing the note on the aforesaid related party transactions is enclosed herewith as Annexure - IV.
The Policy on the Related Party Transactions as approved by the Board is uploaded on the website of the Company.
26. EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-V. Further pursuant to the provisions of Section 92 (3) of the Companies Act 2013 the Annual Return of the company is placed on the website of the Company www.avantel.in on the following link http://www.avantel.in/inversteinfo.php.
27. STATE OF AFFAIRS OF THE COMPANY
The State of Affairs of the Company is presented as part of Management Discussion and Analysis Report forming part of this Report.
28. MANAGEMENT DISCUSSION AND ANALYSIS:
Pursuant to Regulation 34 (2) (e) of SEBI (LODR) Regulations 2015 a report on Management Discussion & Analysis is herewith annexed as Annexure-VI.
29. CORPORATE GOVERNANCE REPORT:
Pursuant to Regulation 34 read with Schedule V of SEBI (LODR) Regulations 2015 a report on Corporate Governance is herewith annexed as Annexure-VII.
30. PARTICULARS OF EMPLOYEES:
The information required pursuant to Section 197 (12) read with Rule 5 (1)& (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employees of the Company is herewith annexed as Annexure- VIII.
In terms of Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company does not have any employee who is employed throughout the financial year and in receipt of remuneration of Rs. 120 Lakhs or more or employees who are employed for part of the year and in receipt of Rs. 8.50 Lakhs or more per month.
The Company does not have any employee who is employed throughout financial year or part thereof who was in receipt of remuneration in financial year under review which in aggregate or as the case may be at a rate which in the aggregate is in excess of that drawn by the Managing Director or Whole time director and holds by himself or along with his spouse and dependent children not less than 2% of the equity shares of the Company.
31. HUMAN RESOURCES:
Your Company considers its Human Resources as the key to achieve its objectives. Keeping this in view your Company takes utmost care to attract and retain quality employees. The employees are sufficiently empowered and such work environment propels them to achieve higher levels of performance. The unflinching commitment of the employees is the driving force behind the Company's vision. Your Company appreciates the spirit of its dedicated employees.
32. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
There are no significant material orders passed by the Regulators /Courts/ Tribunals which would impact the going concern status of the Company and its future operations.
33. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There were no Material Changes and Commitments Affecting the Financial Position of the Company.
34. ACKNOWLEDGMENT AND APPRECIATION:
Your Directors take this opportunity to thank the customers shareholders suppliers bankers business associates for their consistent support and continued encouragement to the Company.
Further your Directors convey their appreciation for the wholehearted and committed efforts by all its employees. Your Directors gratefully acknowledge the ongoing co-operation and support provided by the Central and State Governments Stock Exchanges SEBI RBI and other Regulatory Bodies.
|By order of the Board of Directors|
|For Avantel Limited|
|Place: Hyderabad||Abburi Vidyasagar|
|Date: 9th May 2020||Chairman & Managing Director|