Your Directors have pleasure in presenting their 27thAnnual Report on thebusiness and operations of the Company and the accounts for the Financial Year ended March31 2019.
1.Financial summary or highlights/Performance of the Company:
The Board's Report is prepared based on the financial statements of the company.
| || || || |
(Amt. in Lakhs)
|S No Particulars ||Standalone ||Consolidated |
| ||2018-19 ||2017-18 ||2018-19 ||2017-18 |
|1. Revenue from Operations ||1229.92 ||2891.79 ||2568.51 ||3357.43 |
|2. Operating Expenditure ||1189.19 ||2833.61 ||2510.80 ||3295.95 |
|3. Extraordinary Expenses ||- ||- ||- ||- |
|4. Profit before Tax ||0.87 ||4.35 ||(1.90) ||1.44 |
|5. Profit after Tax ||(1.57) ||3.82 ||(4.34) ||0.76 |
|6. Balance carried to Balance Sheet ||(1017.00) ||(1015.44) ||(1011.74) ||(1007.39) |
2. Brief description of the Company's working during the year/State of Company'saffairs
On Consolidated basis revenue for the year 2018-19 stands at Rs. 256850669/- whichreduced by 30.72% as compared to Rs. 335743162/- in 2017-18 and the net loss for theyear 2018-19 stands at Rs.434107 as compared to profit of Rs. 76226/- in the year2017-18
On Standalone basis revenue for the year 2018-19 is at Rs. 122991658/- and the Netloss for the year at Rs.156698/-
There is no change in the nature of business during the period under review.
3. Dividend and Reserves
During the period under review profits were not appropriated to any reserves.
4. Change in Capital Structure
There is no change of capital structure since the closure of Financial Year 2018-19till the date of notice.
5. Subsidiary Company
As on March 31 2019 the Company has two subsidiary companies namely:
i. Netocol System and Solutions Private Limited (Wholly Owned Subsidiary)
ii. Amaravati Global Solutions Private Limited
As per the provisions of Section 129(3) of the Companies Act 2013 ("Act") astatement containing salient features of the financial statements of the Company'ssubsidiary in Form AOC-1 is annexed as "Annexure-A" and forms an integral partof this Report. Pursuant to the provisions of Section 136 of the Act the financialstatements along with the relevant documents and separate audited financial statements inrespect of subsidiary is available on the website of the Company.
6. Public Deposits:
Your Company has not accepted any deposits from the public within the meaning ofChapter V of the Act and as such no amount of principal or interest was outstanding as onthe balance sheet date.
7. Corporate Governance Report And Management Discussion And Analysis
Separate reports on Corporate Governance Report and Management Discussion and Analysisas required by Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 ["SEBI (LODR) 2015"] forms part of this AnnualReport along with the required Certificate from the Statutory Auditors of the Companyconfirming the compliance of requirements of Corporate Governance as stipulated in theSEBI (LODR) Regulations 2015.
8. Directors and Key Managerial Personnel
During the period under review there is change in Composition of Board.
Mr. G Suresh Babu resigned from the position of director on 16th April 2019and Mr. Naresh Konda joined the position of Whole-Time Director from 16th April2019. Mr. Phaneedra Bondalapati joined Company as Chief Financial Officer (CFO) on 14thFebruary 2019 in place of Mr. Parne Venkateshwar Reddy who resigned on 14th February2019. Ms. Sakshi Mathur was appointed 05th April 2019 as Company Secretary cumCompliance officer of the Company.
Mr. Prabhakara Rao Alokam will retire by rotation at the forthcoming Annual GeneralMeeting and being eligible offers himself for reappointment. The Board of Directorsrecommends his re-appointment at the ensuing Annual General Meeting.
Declaration of Independence by Independent Directors
The Independent Directors of your Company have submitted declaration confirming thatthey meet the criteria of independence as laid down under Section 149(6) of the Act andRegulation16(1)(b) of the Listing Regulations
9. Familiarization Programme
The Company has formulated a Familiarization Programme for Independent Directors withan aim to familiarize the Independent Directors with the Company their roles rightsresponsibilities in the Company nature of the industry in which the Company operatesbusiness model of the Company etc. to provide them with better understanding of thebusiness and operations of the Company and so as to enable them to contributesignificantly to the Company.
10. Particulars of Employees
None of the employees has received remuneration exceeding the limit as stated in rule 5(2) of the Companies (Appointment and remuneration of Managerial Personnel) Rules 2014.
During the year Eight (8) Board Meetings and Three (4) Audit Committee Meetings wereconvened and held. The details of which are given in the Corporate Governance Report. TheIntervening Gap between the meetings was within the period prescribed under the CompaniesAct2013
12. Board Evaluation
Pursuant to section 178 (2) of the Companies Act2013 the Nomination and RemunerationCommittee has evaluated the performance of individual directors in its duly convenedmeeting. Pursuant to section 134(3)(p) of the Companies Act2013 and Regulation4(2)(f)(ii)(9) of the SEBI (LODR)(Erstwhile Clause 49 of the Listing Agreement) the Boardhas carried out an annual performance evaluation of its own performance the directorsindividually as well as the evaluation of the working of its Audit Nomination &Remuneration and Compliance Committees. The manner in which the evaluation has beencarried out has been explained in the Corporate Governance Report.
13. Remuneration Policy
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. Remuneration policy is stated in the Corporate Governance Report.
M/s M M Reddy & Co. Chartered Accountants (FRN: 010371S) the present Auditors hasbeen appointed for five consecutive years (Subject to the ratification by the shareholdersat each AGM held after the previous AGM) by the shareholders at the 26th AGM.
15. Auditors' Report
The Auditors' Report contains qualifications. Notes to Accounts and Auditors remarks intheir report are self-explanatory and do not call for any further comments.
16. Secretarial Audit Report
In terms of Section 204 of the Act and Rules made there under M/Subhash Kumar &Co. Practicing Company Secretaries have been appointed as Secretarial Auditors of theCompany. The report of the Secretarial Auditors is enclosed as Annexure III to thisreport. The report is self-explanatory and do not call for any further comments.
17. Risk management policy
A statement indicating development and implementation of a risk management policy forthe Company including identification therein of elements of risk if any this in theopinion of the Board may threaten the existence of the company.
18. Extract of Annual Return:
As required pursuant to Section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of annual return in MGT9 as a part of this Annual Report as Annexure II.
19. Material changes and commitments if any affecting the financial position of thecompany which have occurred between the end of the financial year of the company to whichthe financial statements relate and the date of the report
There are no material changes occurred during the financial year of the Company towhich financial statements relate and the date of the report.
20. Details of significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and company's operations in future
During the period under review there are no significant material orders passed by theregulators or courts or tribunals impacting the going concern status and company'soperations in future
During the period under review the company has not accepted any deposits as envisagedunder Section 74 and 76 and Companies (Acceptance of Deposits) Rules 2014
22. Particulars of loans guarantees or investments under section 186
During the period under review the company has not given any loans guarantees but hasmade investments as envisaged under Section 186 of Companies Act 2013.
23. Particulars of contracts or arrangements with related parties
There are no related party transactions in the Company during the year
24. Corporate Governance Certificate
The Compliance certificate from the auditors regarding compliance of conditions ofcorporate governance as stipulated in Regulation 27 of SEBI(Listing Obligations andDisclosure Requirement) Regulations 2015 (Erstwhile Clause 49 of the Listing Agreement)is annexed with the report.
25. Management Discussion and Analysis
The Management Discussion and Analysis forming part of this Annual Report has beendiscussed elsewhere in the Report.
26. Statutory Disclosures
In terms of the provisions of Section 134 of the Companies Act 2013 read with theCompanies Rules as amended the names and other particulars of the employees are set outin the Directors' Report. However as per the provisions of Section 219 (b) (IV) of thesaid Act read with Regulation 36 of Listing Obligations and Disclosure Requirements 2015 the Annual Report excluding the aforesaid information is being sent to all the membersof the Company and others entitled thereto. Any member interested in obtaining suchparticulars may write to the Company at the registered office of the Company.
27. Obligation of Company Under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013
In order to prevent sexual harassment of women at work place a new act the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 hasbeen notified on 9thDecember 2013. Under the said Act every company isrequired to set up an Internal Complaints Committee to look into complaints relating tosexual harassment at work place of any women employee.
The Final charter of policy for prevention of Sexual Harassment of Women at workplaceis yet to be adopted.
28. Conservation of energy technology absorption and foreign exchange earnings andoutgo
As per section 134 (3) (m) of the Companies Act 2013 the details of conservation ofenergy technology absorption foreign exchange earnings and outgo are as follows
(a) Energy technology absorption: Nil
(b) Foreign exchange earnings: Nil
(c) Foreign exchange Outgo: Nil
29. Corporate Social Responsibility (CSR)
Corporate Social Responsibility (CSR) is not applicable to the company as the thresholdas mentioned in the provisions Companies Act 2013 is not applicable to our Company.
30. Vigil Mechanism/Whistle Blower
Your Company has a Vigil Mechanism in place as required under Section 177 of the Actand the SEBI (LODR)Regulations 2015 and SEBI (Prohibition of Insider Trading) (Amendment)Regulations 2018. The mechanism provides for adequate safeguards against victimization ofpersons who use such mechanism and make employees. aware of such policy to enableemployees to report instances of leak of unpublished price sensitive information and makeprovisions for direct access to the Chairman of the Audit Committee.
31. Directors' Responsibility Statement
The Directors' Responsibility Statement referred to in clause (c) of sub-section (3) ofSection 134 of the Companies Act 2013 shall state that
(a) In the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
(b) 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 and ofthe profit and loss of the company for that period;
(c) The directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
(d) The directors had prepared the annual accounts on a going concern basis; and
(e) The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
(f) The directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
32. Listing with Stock Exchanges:
The Company confirms that it has not paid the Annual Listing Fees for the year 2019-20to BSE Limited where the Company's Shares are listed.
Your Directors take this opportunity to express their gratitude for the valuablesupport extended by the customers banks financial institutions investors businessassociates central & state government authorities. Your Directors also appreciate theemployees at all levels for their continued support to the Company. Your Directors believethat with the whole hearted support of employees stakeholders bankers and our valuablecustomers we will continuously excel in the path of success and growth.
| ||For and on behalf of the Board of Directors |
| ||Sd/- |
| ||PrabhakaraRaoAlokam |
| ||Director |
| ||(DIN: 02263908) |
| ||Sd/- |
| ||Naresh Konda |
|Place: Hyderabad ||Director |
|Date: 05.09.2019 ||(DIN: 08163277) |