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D B Corp Ltd.

BSE: 533151 Sector: Media
NSE: DBCORP ISIN Code: INE950I01011
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OPEN 125.15
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VOLUME 1722
52-Week high 208.90
52-Week low 123.10
P/E 7.11
Mkt Cap.(Rs cr) 2,172
Buy Price 124.15
Buy Qty 36.00
Sell Price 129.00
Sell Qty 1.00
OPEN 125.15
CLOSE 126.40
VOLUME 1722
52-Week high 208.90
52-Week low 123.10
P/E 7.11
Mkt Cap.(Rs cr) 2,172
Buy Price 124.15
Buy Qty 36.00
Sell Price 129.00
Sell Qty 1.00

D B Corp Ltd. (DBCORP) - Director Report

Company director report

Board's Report

To

The Members

D. B. Corp Limited

Your Directors have pleasure in presenting to you the 22nd Annual Reporttogether with the Balance Sheet and Statement of Profit and Loss for the year ended 31stMarch 2018.

FINANCIAL HIGHLIGHTS (STANDALONE RESULTS)

Rs. in Mn.

PARTICULARS 2017-18 2016-17
Revenue from operations 23285 22574
Other Income 239 172
Total Revenue 23524 22746
Operating expenditure 17645 16130
EBITDA 5879 6616
EBITDA Margin 24.99% 29.09%
Finance Cost 67 74
Depreciation & Amortisation 922 862
Total Expenditure 18634 17066
Profit Before Tax 4890 5680
Provision for Tax 1645 1907
Profit After Tax (PAT) 3245 3773
PAT Margin 13.79% 16.59%
FINANCIAL HIGHLIGHTS (CONSOLIDATED RESULTS)
Rs. in Mn.
PARTICULARS 2017-18 2016-17
Revenue from operations 23285 22580
Other Income 238 170
Total Revenue 23523 22750
Operating expenditure 17647 16158
EBITDA 5876 6592
EBITDA Margin 24.98% 28.97%
Finance Cost 67 74
Depreciation & Amortisation 924 863
Total Expenditure 18638 17095
Profit Before Tax 4885 5655
Provision for Tax 1645 1907
Profit After Tax (PAT) 3240 3748
PAT Margin 13.77% 16.47%
Dividend as % of Paid-up Share Capital 10% 40%

REVIEW OF PERFORMANCE OPERATIONAL HIGHLIGHTS AND FUTURE OUTLOOK

India as one of the faster growing economies of the world demonstrated strongresilience on the face of global slow growth environment. India is expected to emerge asone of the top three economic powers of the world over the next 10-15 years as per theCentral Statistics Organisation (CSO) and IMF (International Monetary Fund). Moody'supgradation of India's sovereign rating after 14 years from Baa3 (lowest investmentgrade) to Baa2 also underlines the strength of the country's economic fundamentals.

After a temporary slowdown triggered by the implementation of demonetization and GSTthe economy started showing signs of recovery in the second half of FY 18. The revival inpositive sentiment was reflected in the pick-up in industrial production and a decline inretail inflation (as measured by the CPI) after a period of negativity. The last quarterof the fiscal saw India record its fastest growth in seven quarters at 7.7% to overtakeChina which grew at 6.8% in the quarter ended March 2018. The farm manufacturing andservices sectors propelled this growth which is expected to sustain in the coming year.

D. B. Corp Limited's (DBCL) performance for the fiscal 2017-18 needs to be viewed inthe context of aforesaid economic and market environment forces. D. B. Corp Limited(‘DBCL') delivered another year of resilient performance aided by strong marketdevelopment strategies establishment of long term customer relationships and well plannedexecution of sharper on-ground marketing efforts.

Your Company maintained its focus on editorial strategy which has led to significantimprovement in quality of editorial content greater readership delight and growth. DainikBhaskar newspaper continues to be the Nation's largest circulated multi-edition daily asper Press In India Report 2016-17 prepared by the Registrar of Newspapers of India (RNI)and recently informed by the Honourable Union Information and Broadcasting Minister Mr.Rajyavardhan Singh Rathore in Parliament during an answer.

As per recently announced Indian Readership Survey (IRS) numbers the Dainik BhaskarGroup has maintained its leadership as the Largest Newspaper Group of Urban India. DainikBhaskar newspaper continues to hold the # 1 position as the largest read newspaper of SECAB (Socio- Economic Class AB) which is now called NCCS AB. The Dainik Bhaskar newspaperalso holds #1 position as the largest read newspaper of Socio-economic Class - A i.e. SECA which is now called NCCS A.

Dainik Bhaskar continues to be the world's fourth largest circulated news daily byWAN-IFRA in its World Press Trends 2016 report. It ranks behind 3 newspapers which arefrom outside India; of which 2 are from Japan and 1 from USA.

As part of other significant developments the following are noteworthy:

During FY 2017-18 the company executed a challenging and ambitiousCirculation Expansion strategy in its legacy markets of Rajasthan Gujarat and in thenewer market of Bihar. The circulation copies increased from an average of 50.4 lakhcopies at the start of the initiative in July 2017 to 57.9 lakh copies by the end of theyear i.e. a growth of around 15% in a 9-month's period; and this entire circulationincrease was achieved at a higher cover price.

Dainik Bhaskar has successfully completed entire Bihar expansion drive. Ithas aggressively expanded copies in circulation reflecting over 2x growth across 38districts covering key Tier II and Tier III cities and towns in Bihar with around 7 lakhcopies.

MY FM completed the fastest roll out of all 13 newly acquired stations underBatch 1 of Phase III and expanded the company's reach to 7 states and across 30 cities byMarch 2017. Your Radio business MY FM has become the largest player in the Rest ofMaharashtra and No. 1 in Chandigarh / Haryana / Punjab / Rajasthan / Madhya Pradesh &Chhattisgarh.

As a part of DBCL's digital business www.dainikbhaskar.com the largestHindi News Website continues to secure the No. 1 spot in Hindi News andwww.divyabhaskar.com continues to remain #1 Gujarati website.

The digital business with 9 internet portals with a very formidable andstrong position in almost 67% of Indian language media space in terms of Unique Visitorsand Page Views is the dominant No.1 digital player in various Indian languages i.e.Hindi and Gujarati alongside 4 actively available and well-used mobile apps.

Print Business

During the period under review the Indian economy showed an improvement over 2016-17but continued to grow at a slower pace. DBCL executed a challenging and ambitiousCirculation Expansion strategy in its legacy markets of Rajasthan Gujarat and in thenewer market of Bihar. We are happy to report that it has delivered favourable responsewith advertising revenue witnessing a growth of around 3 % and circulation revenueregistering a growth of around 7%.

Performance highlights of the Company during the year under consideration are asfollows:

Standalone revenue from operations and other income was Rs. 23524million witnessing a growth of 3.42% as compared to Rs. 22746 million in the previousyear.

Standalone advertising revenue grew 2.83% to

Rs. 16425 million which includes revenue from print radio and digital media business.

Circulation revenue grew by 7% to Rs. 5145 million from

Rs. 4814 million largely driven by rate growth. Circulation revenue has witnessed CAGRgrowth of around 15% for past 5 years largely driven by rate growth.

The consolidated gross revenue increased by 3.4% to

Rs. 23523 million as compared to Rs. 22750 million in the previous year.

EBIDTA margin of matured business stands at 28.59%.

The Company has not transferred any amount to General Reserve for the FY 2017-18.

Emerging Editions / Business

In order to analyse the performance of the Company its divisions / editions aresegmented into emerging and matured editions / business as any new edition / businesslaunched takes long for stabilisation and for earnings.

Review of Performance of Emerging Editions / Business Summary Financials (StandaloneResults) ( Rs. in Mn.)

PARTICULARS Emerging Editions Matured Business Total
& Business
FY 2017-18
Turnover
-- Advt. Revenue 516 15909 16425
-- Sales 276 4869 5145
-- Others 92 1862 1954
Total Income 884 22640 23524
Newsprint Cost 601 6707 7308
Opex 878 9459 10337
Total Cost 1479 16166 17645
EBITDA (595) 6474 5879
EBITDA Margin (%) (67.30%) 28.59% 24.99%
Interest 1 66 67
Depreciation 51 871 922
PBT (647) 5537 4890
PBT Margin (%) (73.19%) 24.45% 20.79%

Emerging editions are classified as those editions which are below four years of age orwhich have turned profitable in last four consecutive quarters whichever is earlier.

For FY 2017-18 the emerging editions include editions in newly launched states ofMaharashtra and Bihar Mobile app and also newly launched e-real estate division during FY2015-16. Due to shifting of Jharkhand and most part of Maharashtra in Matured categoryEmerging business revenues are not comparable on a YoY basis. At the same time maturedbusiness has reported EBIDTA Margin at 28.59%.

Radio Business

94.3 MY FM is one of the largest radio network of the Tier II and Tier III citiesspread across seven states and 30 cities (including the newly launched 13 radio stationsunder Batch 1 of phase III in the previous year) commanding a leadership rank in almostall of its markets both in terms of listenership as well as retail market share.

The Radio Business continued to perform exceptionally well in this financial year.Total income of this division increased from Rs. 1273 million during the previous year toRs. 1358 million reporting a growth of 6.73% one of the best among the Radio players.EBIDTA has decreased by (24.35%) at Rs. 362 million and EBIDTA margin is 27%.

Digital Business

The digital business declined in total income by 6.8% to Rs. 529 million. DB Digitalhas a very formidable and strong position in almost 67% of the Indian language media spacein terms of Unique Visitors and Page Views. Dainik Bhaskar and Divya Bhaskar app havecollectively reached 12.3 million app downloads till March 2018.

MAJOR CAMPAIGN / EVENTS DURING THE YEAR

Launch of a new brand campaign with sharper product promise of "ChaloAaj Kuch Achcha Sunte Hai" across stations to engage and strengthen listener connect.

Extending the "Achcha Sunte hai" promise MY FM gifted hearingaids to children (aged 6-8 years) with hearing impairments. This drive was implementedacross Surat Rajkot and Ahmedabad. An overwhelming number of people responded to MY FM'scall to make a difference.

Celebrating 10 years of presence in Ahmedabad and Surat MY FM executed thebiggest Music and Entertainment Festival. More than 25k and 7k people in Ahmedabad andSurat respectively witnessed the event.

Rangrezz Season 4 - MY FM flagged off India's largest painting competitionacross the network. The theme was based on inciting a deep sense of state pride amongstchildren through catchphrases like Incredible Rajasthan Incredible Gujarat etc. Over612 schools and 3 lakh children participated

Ek Rakhi Fauji Ke Naam campaign in which MY FM RJ asked listeners to sendRakhis for their bothers in the army; 299446 Rakhis were collected through thisinitiative.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

As representative of Dainik Bhaskar group the Company takes CSR very seriously andwants to make it a mass movement. With this purpose in mind your Company has tweaked ourstrategy on CSR and now mostly adhere to advocacy model. The idea is to concentrate ourefforts on utilizing our extensive reach to put across our CSR messages to as many peopleas possible by way of advertisements and write-up.

Company's CSR initiatives are meant to inform educate and engage the readers to carefrom nature environment and deprived sections. While such initiatives may not showimmediate results but in the long run have great potential to sensitize people and makethem more humane.

Highlights of the Company's overall CSR initiatives during FY 2017-18 were as follows:

Tilak Holi–Encouraging people to reduce wastage of water and insteadcelebrate holi with natural and dry colours.

Mitti Ke Ganesh – observing Ganesh Chaturthi using idol made of naturalclay and spread videos teaching how to make the clay idols.

Sarthak Deepavali–persuading people to make Diwali a true festival ofjoy by bringing happiness on faces of those who are deprived.

Ek Ped Ek Zindagi– appealing people to plant conserve and preservemore trees to save environment.

Jal Satyagrah–Informing people about the scarcity of water and ways tocut down its wastage.

Daan Campaign– Urging people to observe Republic Day (26thJanuary) by donating things which are no longer of use to one to the needy.

Save Birds – Appealing people to take care of birds during summerseason by keeping aside food and water for them in pots.

Live Positive Campaign –driving a whole campaign to discourage studentsfrom committing suicide by roping in coaching institutes and responsible people to becomestudent buddies.

A brief outline of the CSR policy of the Company and initiatives undertaken by theCompany on CSR activities during the year are set out in "Annexure A" to thisreport. For other details regarding the CSR Committee please refer to the CorporateGovernance Report which is a part of this report. The CSR policy is available on thewebsite of the Company.

During the year the Company incurred an expenditure of

Rs. 45.1 million on CSR activities as against the required spend of Rs. 100.7 million.The Company could not spend the balance required amount on account of non-availability offitting significant and concrete CSR projects. The Company is committed towardsundertaking additional activities in the areas of promoting education empowering womenenvironmental sustainability healthcare and sanitation to mention a few and ensure theremaining amount is spent on tangible CSR activities.

AWARDS AND ACCOLADES

Winning awards is the result of strategic efforts to build a company's authority as anindustry leader and a great opportunity to showcase the excellence standards. Your Companywas conferred with as many as 81 awards during FY 2017-18 under various segments of itsbusiness for its Brand & Marketing Campaigns CSR Initiatives Event ActivationEffectiveness in Publication & Media and Print Innovations Corporate CollateralsBest Use of CSR practices in Media & Entertainment Public Awareness Programme etc.These include 12 Asian Customer Engagement Awards

9 Public Relation Council of India Awards 6 India Radio Forum Awards 4 MarComAwards and 3 Summit International Awards.

DIVIDEND

Your Directors have recommended a final dividend @ 10% (i.e. Rs. 1/- per equity shareof the face value of Rs. 10/- each) for the year ended 31st March 2018 subjectto approval of members at the ensuing Annual General Meeting of the Company.

The total amount of dividend to be paid as Final Dividend is approx. Rs. 18.4 Crore.

DIVIDEND DISTRIBUTION POLICY

As per Regulation 43A of the SEBI Listing Regulations the Company has framed aDividend Distribution Policy which had been approved by the Board of Directors at itsmeeting held on 20th October 2016. The Policy lays down a framework forconsidering decisions by the Board of the Company with regard to distribution of dividendto the shareholders and/ or retaining or plough back of its profits. A copy of the Policyhas been attached as ‘Annexure B' to this report and the same is also available forviewing on the Company's website and can be accessed at:http://investor.bhaskarnet.com/files/ Dividend%20Distribution%20Policy.pdf

BUY BACK OF EQUITY SHARES BY THE COMPANY

The members of the Company have approved Buyback proposal for buy-back of up to9200000 fully paid-up equity shares of Rs. 10/- each (being approx. 5% of the totalpaid–up equity share capital of the Company as on 31st March 2018) at aprice of Rs. 340/- per equity share on a proportionate basis through tender offer for anaggregate amount of

Rs. 312.80 Crore (excluding transaction cost viz. brokerage applicable taxes such assecurities transaction tax stamp duty and goods and service tax etc.). The approval forBuyback proposal was accorded by the members of the Company by passing the enablingSpecial Resolution through Postal Ballot as per statutory requirements in this regard theresults of which were declared by the Company on 7th July 2018.

The Company has made the Public Announcement in this regard after compliance with allthe necessary disclosures. The Record Date for determining the eligibility of theshareholders to participate in the Buyback is set as 18th July 2018. TheCompany will be completing the Buyback within 12 months from the date of SpecialResolution passed approving the proposed Buyback which is 6th July 2018.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr. Naveen Kumar Kshatriya Independent Director of the Company resigned fromdirectorship on the Board from 30th September 2017. The Board places on recordits gratitude for the valuable services rendered by Mr. Naveen Kumar Kshatriya during hisassociation with the Company.

At the Board Meeting held on 16th May 2018 Mr. Pawan Agarwal (DIN:00465092) the Deputy Managing Director of the Company was re–appointed for a furtherperiod of five (5) years w e f. 31st July 2018 up to 30th July2023 subject to members' approval sought at the forthcoming Annual General Meeting alongwith an increase in his remuneration from the existing remuneration of Rs. 60 Lakh p.a. to

Rs. 1 Crore p.a. as detailed below.

PARTICULARS Amount in Rs.
Basic Pay (Annual) 10000000/-
Perquisites Bonus Commission & other allowances Nil

Pursuant to Section 152 of the Companies Act 2013 (the "Act") and theArticles of Association of the Company Mr. Pawan Agarwal Deputy Managing Director retiresby rotation at the ensuing Annual General Meeting and being eligible offers himself forre-appointment. He has confirmed that he is not disqualified from being appointed as aDirector in terms of Section 164 of the Act.

A brief resume of Mr. Pawan Agarwal nature of his expertise in specific functionalareas and names of the Companies in which he holds directorships and / or membership /chairmanship of committees of the Board as stipulated under SEBI Listing Regulations isgiven in the Corporate Governance Report forming part of the Annual Report.

Mr. Sudhir Agarwal has been appointed as the Managing Director of the Company for aterm of 5 years (1st January 2017 to 31st December 2021) at aremuneration of Rs. 90 Lakh p.a. Considering ever expanding business of the Company theindustry trend as also the business acumen and the vast experience that he possesses onrecommendation of the Nomination and Remuneration Committee and approval of the AuditCommittee the Board of Directors at its meeting held on 19th July 2018 hasincreased his remuneration from Rs. 90 Lakh p.a. to Rs. 1.5 Crore p.a. as detailed beloww.e.f.

1st October 2018 subject to approval of the members of the Company at theensuing Annual General Meeting (AGM). Members' approval is sought for the said increase inhis remuneration at the forthcoming Annual General Meeting.

PARTICULARS Amount in Rs.
Basic Pay (Annual) 15000000/-
Perquisites Bonus Commission & other allowances Nil

In terms of Sections 149 and 152 of the Companies Act 2013 it is proposed tore-appoint the 3 (three) Independent Directors on the Board of the Company. Each of Mr.Piyush Pandey and Mr. Harish Bijoor are proposed to be re-appointed for the secondconsecutive term of 2 years i. e. from 1st January 2019 till 31stDecember 2020 and Mr. Ashwani Kumar Singhal is proposed to be re-appointed for the secondconsecutive term of 5 years i. e. from 1st January 2019 till 31stDecember 2023. Resolutions for appointing them as Independent Directors for secondconsecutive term are recommended for passing by the members of the Company at the ensuingAnnual General Meeting. A brief resume of each of these Independent Directors nature oftheir expertise in specific functional areas and names of the Companies in which they holddirectorship and / or membership / chairmanship of Committees of the Board as stipulatedunder SEBI Listing Regulations is given in the Corporate Governance Report forming part ofthe Annual Report.

The Company has received declarations from the Independent Directors that they meetwith the criteria of independence as laid down under Section 149(6) of the Act and theSEBI Listing Regulations. The Company has also received a notice under Section 160 of theAct signifying their candidature for the office of Independent Director.

None of the Non-Executive Directors had any pecuniary relationships or transactionswith the Company which may have potential confiict with the interests of the Company atlarge.

BOARD MEETINGS

During the year under review the Board met 4 (four) times the details of which aregiven in the Corporate Governance Report which may be taken as forming a part of thisReport.

COMMITTEES OF THE BOARD

The Board of Directors functions through the following committees constituted in termsof the provisions of the Companies Act 2013 and SEBI Listing Regulations:

Audit Committee Stakeholders' Relationship
Committee
Nomination and Corporate Social
Remuneration Committee Responsibility Committee
Compensation Committee Executive Committee

The legal provision mandating constitution of Risk Management Committee is not yetapplicable to the Company. The details regarding composition and meetings of thesecommittees held during the year under review are given in the Corporate Governance Reportwhich may be taken as forming a part of this Report.

BOARD EVALUATION

The Board has evaluated the performance of each director on the Board based on theparameters listed out in the ‘Policy on Performance Evaluation of the Board' framedby the Nomination and Remuneration Committee. The evaluation of the Board and itsCommittees has been done by the Board considering the Board dynamics and processescontribution towards development of the strategy risk management budgetary controlsreceipt of regular inputs and information functioning performance and structure of BoardCommittees ethics and values skill set knowledge and expertise of Directorsleadership etc. A report in brief on Board evaluation has been given in the CorporateGovernance Report which may be taken as forming a part of this Report.

POLICY ON NOMINATION AND REMUNERATION OF DIRECTORS KMPS AND OTHER EMPLOYEES

The Nomination and Remuneration Committee of the Company leads the process for Boardappointments in accordance with the requirements of Companies Act 2013 SEBI ListingRegulations and other applicable regulations or guidelines. As per the policy onNomination and Remuneration of Directors KMPs and Other employees laid down by the saidCommittee all the Board appointments are considered based on meritocracy. The potentialcandidates for appointment to the Board are inter alia evaluated on the basis of highestlevel of personal and professional ethics standing integrity values and character;appreciation of the Company's vision mission values; prominence in businessinstitutions or professions; professional skill knowledge and expertise; financialliteracy and such other competencies and skills as may be considered necessary. Inaddition to the above the candidature of an Independent Director is also evaluated interms of the criteria for determining independence as stipulated under Companies Act2013 SEBI Listing Regulations and other applicable regulations or guidelines.

At the meeting of the Nomination and Remuneration Committee held on 16 May 2018 aproposal was placed for the re-appointment of three Independent Directors for the secondconsecutive term. The Committee has taken into consideration the results of theperformance evaluation of the Directors before recommending their re-appointment to themembers of the Company for approval at the forthcoming Annual General Meeting.

The detailed policy on Nomination and Remuneration of Directors KMPs and Otheremployees is given in the Corporate Governance Report which may be taken as forming a partof this Report.

EXTRACT OF ANNUAL RETURN

The details prescribed and required under Section 92(3) of the Companies Act 2013constituting the extract of the Annual Return is attached as ‘Annexure C' to thisReport.

RISK MANAGEMENT

Your Company is very keen on identifying evaluating and managing significant risksfaced by the Company and prioritizes relevant action plans in order to mitigate suchrisks. Risk management framework is reviewed periodically by the Board and AuditCommittee which includes discussing the management submissions on risks evaluating keyrisks and approving action plans to mitigate such risks.

The risk management framework adopted and implemented by the Company is given in theCorporate Governance Report which may be taken as forming a part of this Report.

INTERNAL CONTROL SYSTEM AND ITS AQEQUACY

Your Company has built up a strong and efficient internal control mechanism which iscommensurate with the size of its business operations. It has laid down standard operatingguidelines and processes which ensure smooth functioning of activities and zero ambiguityin the minds of people who actually execute the operations.

State Heads and Corporate Finance Heads are accountable for financial controls. Theyare fully responsible for accuracy of books of accounts preparation of financialstatements and reporting in line with the Company's accounting policies. DBCL has deployeda vigorous Internal Controls and Audit Mechanism to facilitate an accurate and fairpresentation of its financial results. This process not just ensures adherence toregulatory standards and meets statutory compliance requirements but also confirms thatour reporting is complete reliable and understandable. In addition there is a specificimpetus on safeguarding investor interests with deployment of the highest levels ofgovernance and regular communication with them.

Over the years DBCL has undertaken specific efforts to build up its Processes anddeploy Standard Operating Guidelines across all operational areas.

During FY 2017-18 the Company appointed Independent Chartered Accountancy firms toassist in re-evaluating and testing its Internal Financial Controls (IFC) whichencompassed review reclassification and rationalization of controls.

To build and/or strengthen its Internal Audit structure the Company has engagedexperienced Chartered Accountancy firms across all locations. A system of monthly InternalAudit reporting reviewing and monitoring together with Surprise Audits is set to ensureeffective adherence to established processes internal controls and internal auditmechanism on real-time basis.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

Integrity and ethics have been the bedrock of the Company's corporate operations. Thereis no shortcut to integrity. Your Company is committed to conducting its business inaccordance with the highest standards of professionalism honesty and ethical behavior. Ithas the best systems in place to nurture as honest and ethical working culture.

Your Company is among the first few companies in India to take active steps towardsestablishing a ‘Whistle-blowing Mechanism'. This initiative was taken to encourageemployees to report irregularities in operations besides complying with the statutoryrequirements under Companies Act 2013.

In order to maintain highest level of confidentiality the Company has outsourced thecomplaint receiving mechanism and coordination with the whistle blower to an independentagency. All DBCL employees can avail this mechanism on a daily basis through a dedicatedtoll-free Hotline Website Email or Post. These reporting channels can be accessed inHindi English Marathi and Gujarati. The whistle blower is provided with a referencenumber by the Agency for providing additional information and knowing the status ofcomplaint.

An Internal Ethics Committee has been established to operate this mechanism under thesupervision of the Audit Committee. An ombudsperson along with the Ethics Committeedecides the future course of action. Complaints are categorized and prioritized based ontheir nature and actions are commensurate with the category and priority. If the whistleblower is not satisfied with the actions taken the mechanism also has an EscalationProtocol in place. Through the process the mechanism considers and extends completeprotection to the whistle blower.

PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS

Particulars of loans and guarantees given and investments made under Section 186 of theCompanies Act 2013 have been given separately in the financial statements of the Companyunder Note 31 in the Notes to Accounts which may be read in conjunction with this Report.

TRANSACTIONS WITH RELATED PARTIES

All related party transactions entered into during the financial year were at arm'slength terms. Also there have been no materially significant related party transactionsthat were entered into by the Company with its related parties. Hence the Company is notrequired to attach the prescribed Form AOC – 2 to the Annual Report of the Company.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirements under Section 134(3)(c) of the Companies Act 2013 withrespect to Directors' Responsibility Statement it is hereby confirmed:

1. that in the preparation of the annual accounts for the year ended 31stMarch 2018 the applicable accounting standards have been followed along with properexplanation relating to material departures;

2. that the directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at 31stMarch 2018 and of the profit of the Company for the year ended as on that date;

3. that the directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraudand other irregularities;

4. that the directors had prepared the annual accounts for the financial year ended 31stMarch 2018 on a ‘going concern' basis;

5. that the directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and operatingeffectively;

6. that the directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

SUBSIDIARIES

The Company has 2 subsidiaries as on 31st March 2018. There are noassociate companies or joint venture companies within the meaning of Section 2(6) of theAct. There has been no material change in the nature of the business of thesubsidiaries.

Pursuant to the provisions of Section 129(3) of the Act a statement containing thesalient features of financial statements of the Company's subsidiaries in Form AOC-1 isattached to the financial statements of the Company.

Performance / Business highlights of subsidiaries

The performance / business highlights of the subsidiaries of your Company during thefinancial year 2017-18 are as follows:

1. DB Infomedia Pvt. Ltd. (DBIPL)

DBIPL carries on its business in the domain of online digital space. It has recordedPBT loss of Rs. 4.45 million in the current financial year as compared to PBT Loss of Rs.24.62 million during the previous financial year 2016-17.

2. I Media Corp Limited (IMCL)

IMCL which is housing the event business of the Company recorded an PBT Loss of Rs.1.34 million for the year under consideration. This subsidiary functions in co-ordinationwith radio division and carries out events across MY FM station cities.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34 read with Schedule V of the Listing Regulations is given separatelywhich may be taken as forming a part of this Report.

REPORT ON CORPORATE GOVERNANCE

A report on Corporate Governance as stipulated under Regulation 34 read with Schedule Vof the Listing Regulations is given separately which may be taken as forming a part ofthis Report. A Certificate as prescribed from the Auditors of the Company confirmingcompliance with the provisions of Corporate Governance is attached to the said Report.

BUSINESS RESPONSIBILITY REPORT

A report on Business Responsibility as stipulated under Regulation 34 of the ListingRegulations is given separately which may be taken as forming a part of this Report.

EMPLOYEES' STOCK OPTION SCHEMES

The Company had granted Stock Options to its employees under the ‘DBCL – ESOS2010' and ‘DBCL – ESOS 2011' (Tranches 1 to 6). The Compensation Committee ofthe Board of Directors constituted in accordance with the SEBI Guidelines administersand monitors these schemes. The stock option schemes are in compliance with Securities andExchange Board of India (Share Based Employee Benefits) Regulations 2014 ("EmployeeBenefits Regulations") and there have been no material changes to these schemesduring the financial year.

The details required to be disclosed in terms of Regulation 14 of the Employee BenefitsRegulations are placed on the Company's website and can be accessed at: http://investor.bhaskarnet.com/pages/corporategovernance.php

Your Company has obtained a certificate from the Auditors certifying that the saidEmployee Stock Option Schemes have been implemented in accordance with the EmployeeBenefits Regulations and the resolutions passed by the members in this regard. TheCertificate will be placed at the Annual General Meeting for inspection by the members asprescribed which is also attached to this Report.

STATUTORY AUDITORS

At the previous Annual General Meeting (AGM) of the Company held on 4thSeptember 2017 M/s. Price Waterhouse Chartered Accountants LLP (Firm Registration No.012754N/ N500016) and M/s. Gupta Mittal & Co. (Firm Registration No. 009973C) wereappointed as the Joint Statutory Auditors of the Company for a period of 5 (Five) yearstill the conclusion of 26th Annual General Meeting of the Company (subject toratification by the shareholders at every Annual General Meeting as prescribed at thattime).

However during the year under review the Parliament of India has enacted TheCompanies (Amendment) Act 2017; whereby ratification of auditors at every AGM underSection 139(1) has been done away with. Due to the enforcement of this amendment by theMinistry of Corporate Affairs during the year it is no longer necessary to seekratification of the appointment of the Auditors by the shareholders at every AGMhenceforth.

However the Board wishes to inform the shareholders that the Statutory Auditors viz.M/s. Price Waterhouse Chartered Accountants LLP and M/s. Gupta Mittal & Co. haveconfirmed that their appointment is still within the prescribed limits under Section 139of the Companies Act 2013 and that they are not disqualified for holding such position ofauditorship within the meaning of Section 139 of the said Act.

Auditors' report

The Auditors' Report on the Financial statements of the Company for the financial year2017-18 does not contain any qualifications reservations or adverse remarks.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Companyhas appointed M/s. Makarand M. Joshi & Company a firm of Company Secretaries inPractice to undertake the secretarial audit of the Company.

Secretarial Auditors' report

The Secretarial Audit Report given by the Secretarial Auditor viz. Makarand M. Joshi& Co. Practising Company Secretaries Mumbai is attached as ‘Annexure D' to thisReport.

The Secretarial Auditors have observed that there were few lapses of code of conductunder Insider Trading Regulations during FY 2017-18 for which company is in the process oftaking appropriate actions.

COST AUDITOR

Pursuant to Section 148 of the Companies Act 2013 read with the Companies (CostRecords and Audit) Rules 2014 as amended the cost accounting records maintained by theCompany in respect of its radio business are required to be audited. The Board ofDirectors had on the recommendation of the Audit Committee appointed M/s. K. G. Goyal& Associates Cost Accountants (Firm Registration No. 000024) to audit the costaccounting records of the Company for the financial year 2017- 18 at a remuneration of Rs.25000/- p.a. plus applicable taxes.

M/s. K. G. Goyal & Associates Cost Accountants are also re-appointed by theCompany as Cost Auditors for the FY 2018-19 at the same remuneration. As required underthe Act the remuneration payable to the cost auditor is required to be placed before themembers in a general meeting for their ratification. Accordingly a resolution seekingmember's ratification for the remuneration payable to M/s. K. G. Goyal & Associatesfor FY 2018-19 is included in the Notice convening the Annual General Meeting.

PUBLIC DEPOSITS

During the year under review your Company has not accepted or invited any depositsfrom public within the meaning of Chapter V of the Companies Act 2013 and applicablerules made there under or any amendment or re-enactment thereof.

PARTICULARS OF REMUNERATION TO EMPLOYEES

The particulars of remuneration to directors and employees and other relatedinformation required to be disclosed under Section 197(12) of the Companies Act 2013 andthe Rules made thereunder as amended up to date are given in ‘Annexure E' to thisReport.

PARTICULARS REGARDING CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS AND OUTGO

A. CONSERVATION OF ENERGY

(I) Steps taken or impact on conservation of energy:

The Company has continued its efforts to improve energy efficiency measures with morevigour and gravity. Steps undertaken during the year to conserve energy include:

1. Conducted energy audits at different locations for optimizations of power cost.

2. Post implementation of recommendations derived from the above said energy audit at13 print locations the Company has managed to achieve energy savings of 987172 KWH in theFY 2017-18 despite an increase in print activity.

3. Energy Cost Optimization through conversion from conventional to LED Light arrestedall air leakages and installed VFD on K35 press & air compressors at MP PrinterNoida.

(II) Steps taken by the Company for utilising alternate sources of energy:

1. Implemented a Solar PV plant installation at one of its premium locations which islikely to be operational soon.

2. GMG Ink Optimization Application installed - PAN India

3. Migration from LPG to PNG for Fuel cost optimization at MP Printer Noida

(III) Capital investment on energy conservation equipments:

During the year the Company has invested Rs. 1.011 million on procurement andinstallation of branded LED Lights across the Company's various locations.

B. TECHNOLOGY ABSORPTION

Efforts made towards technology absorption and Benefits derived like productimprovement cost reduction product development or import substitution:

1. Conservation of water and energy.

2. No disposal of polluting effiuents to mother earth.

In case of imported technology (imported during the last 3 years reckoned from thebeginning of the financial year):

Nil / Not Applicable

Expenditure on R & D:

Nil

C. FOREIGN EXCHANGE EARNINGS AND OUTGO

Your Company earned Foreign Exchange of Rs. 380 million (Previous Year Rs. 391million). The financial expenses in foreign exchange during the year was Rs. 13.5 million(Previous Year Rs. 15.7 million) and on account of advertisement travellingmaintenance and other expenses was Rs. 37 million (Previous Year Rs. 115 million).

 

DEMAT SUSPENSE ACCOUNT

During the year under review the Company has transferred to the IEPF Suspense Accounta total of 2868 shares on which no dividend had been claimed for seven (7) consecutiveyears. Out of these 2868 shares 217 shares of 5 shareholders that were lying in DematSuspense Account of the Company as on 31st March 2017 since the Initial PublicOffer of the Company in January 2010 were also transferred to the IEPF Suspense Accountas mandated under IEPF rules.

Shareholders are requested to note that even after the transfer to IEPF as abovesaidthe unclaimed dividend amount and the shares transferred to IEPF Suspense Account bothcan be claimed by making an online application in Form IEPF-5 and sending the physicalcopy of the same duly signed (as per registered specimen signature) along with requisitedocuments enumerated in the said Form IEPF-5 to the Company at its registered office or tothe RTA.

The IEPF Rules and the application form (Form IEPF-5) as prescribed by the Ministry ofCorporate Affairs are available on the website of the Ministry of Corporate Affairs atwww. iepf.gov.in.

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

Pursuant to the applicable provisions of the Companies Act 2013 read with the IEPFAuthority (Accounting Audit Transfer and Refund) Rules 2016 ("the rules")all the unpaid or unclaimed dividends are required to be transferred by the Company to theIEPF established by the Central Government after the completion of seven years.

Further according to the said Rules the shares in respect of which dividend has notbeen paid or claimed by the shareholders for seven consecutive years or more shall also betransferred to the demat account created by the IEPF Authority. Accordingly the Companyhas transferred such shares to IEPF Authority. The Company will continue to transfer suchunclaimed dividend and corresponding shares to IEPF Authority as mandated in future thedetails of which will be provided on its website viz. www.bhaskarnet.com.

GENERAL

Your Directors state that no disclosure is required in respect of the following mattersas there were no transactions in relation thereto during the year under review:

1. Issue of equity shares with differential rights as to dividend voting or otherwise.

2. Issue of sweat equity shares.

3. Non-exercise of voting rights directly by the employees in respect of sharespurchased under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) ofCompanies (Share Capital and Debentures) Rules 2014.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS

There are no significant and material orders passed by the Regulators / Courts /Tribunals which would impact on the going concern status of the Company and its futureoperations.

POLICY REGARDING PREVENTION OF SEXUAL HARRASSMENT AT WORK PLACE

The Company has constituted an Internal Complaints Committee (ICC) which looks intocomplaints of sexual harassment. The victim or a person on victim's behalf may lodge aformal complaint by writing a mail to icc@dbcorp. in / dbcorp@intouch-india.com or bycalling on the hotline number 18001032931.

During the year only one complaint was received by the Company on 20 March 2018 whichwas attended to and closed on priority in April 2018.

No. of complaints received during the year: 1

No. of complaints disposed off: Nil

No. of complaints pending at the end of the year: 1 (which was disposed off in April2018)

HUMAN RESOURCES AND INDUSTRIAL RELATIONS

People Connect:

Your Company fosters a culture of employee and their family wellbeing by offeringvarious types of policies and employee benefits. Policy on Hiring of Relatives ofEmployees Re-hire policy Salary Advance Policy Ramesh Chandra Agarwal ScholarshipSaubhagyawati Bhav (Marriage assistance for employee's daughter) Shubh Laxami (goodgesture on birth of baby girl) Sparsh (good gesture on birth of baby boy) Employee GroupMediclaim Insurance Group Personal Accident Policy Mediclaim for Parents &Parents-in-law Aapaat Nidhi are some of them.

Highlights of some of these policies are given below:

• Ramesh Chandra Agarwal Scholarship is for the children of employees drawingsalary upto Rs. 30000 per month and have worked in the organisation for two years andmore. This is bestowed as a onetime scholarship of Rs. 1 lakh for the meritorious girlchild of the employees who scores more than 90% marks in class 12th exam and asa onetime scholarship of Rs. 30000 for the meritorious children of the employees whoscore more than 86% marks in class 12th exam.

• Sukanya Samridhi account for the children of employees drawing salary uptoRs. 30000 per month and have worked in the organisation for five years and more : Companyhelps in opening Sukanya Samriddhi account (as per Government scheme by this name) bygiving

Rs. 31000 on the birth of girl child of the employees.

• Aapaat Nidhi : An exigency fund is maintained to support the employees andtheir families in any medical exigency and death of an employee.

With emphasise on people care the company's motto "DB Cares" is proved whenthe company offers some unique benefits for its employees and their families in the formof the above-mentioned policies. The management believes that family's happiness leads tomore productive and engaged employee.

Employee Empowerment:

The Company has conceptualised and implemented various human resource policies towardsbetterment of its over 11000 employees. These include Talent Attraction and acquisitionpolicy Centralised Induction & On-boarding policy Performance Management SystemCareer & Succession Planning Potential to Growth (P2G) policy amongst others.

The Company provides a culture of freedom for the employees where an employee is ableto speak his / her mind for the organizational improvements. The Leaders conduct"Let's Chat" meetings to provide a platform to the team where they can sharetheir concern and get solutions.

Year 2017-18 witnessed our journey from PeopleSoft to SuccessFactors as HRIS tool. Thesystem is an automated interface helping the employees as well as the Managers for theirattendance salary performance appraisal productivity dashboard etc.

The Company places a strong emphasis on the work ethics in order to foster a healthycorporate culture in the Company. It has always believed in adhering to the bestgovernance practices to ensure protection of its stakeholders' interests in tandem withhealthy growth of the Company. With this belief the Company has adopted a Code of Conductwhich extends to all its Board Members and Senior Management personnel. Additionally theCompany has framed a policy which deals with Code of Conduct by all the employees acrossthe levels including its subsidiaries. The Code intends to forbid any activity /association / relationship by Directors / employees which is detrimental to the Company'sinterest.

The corporate governance framework is further supported by a Whistle Blower Policywhich serves as a mechanism for its directors and employees to report genuine concernsabout unethical behaviour actual or suspected fraud or violation of the Code of Conductwithout fear of reprisal. The complainant can blow the whistle by calling on hotlinenumber 18001032931 or sending a mail to dbcorp@intouch-india.com.

Company has also formed an Ethics Committee to work towards identifying quick andconsistent actions and timely closure of complaints received and investigated by vigilancedepartment.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to express their thankfulness and profoundgratitude to the Shareholders Banks Financial Institutions Clienteles Vendors Central/ State Governments and other governing authorities; for their support continued backingco-operation and guidance.

For and on behalf of the Board of Directors of
D. B. Corp Limited
Sudhir Agarwal Pawan Agarwal
Managing Director Dy. Managing Director
DIN: 00051407 DIN: 00465092
Place: Mumbai
Date: 19th July 2018
Encl.: Annexure A to E