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Den Networks Ltd.

BSE: 533137 Sector: Media
NSE: DEN ISIN Code: INE947J01015
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OPEN 35.95
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VOLUME 71772
52-Week high 47.10
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P/E 9.30
Mkt Cap.(Rs cr) 1,661
Buy Price 0.00
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Sell Price 0.00
Sell Qty 0.00
OPEN 35.95
CLOSE 35.60
VOLUME 71772
52-Week high 47.10
52-Week low 30.65
P/E 9.30
Mkt Cap.(Rs cr) 1,661
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Den Networks Ltd. (DEN) - Director Report

Company director report

Dear Members

The Board of Directors is pleased to present the Company's Fifteenth Annual Report andthe Company's audited financial statements for the financial year ended March 312022.

1. FINANCIAL RESULTS

The financial performance of the Company (Standalone and Consolidated) for the yearended March 312022 is summarized below:

Particulars

Standalone

Consolidated

2021-22 2020-21 2021-22 2020-21
Revenue from operations 11537.63 12402.53 12255.96 13074.04
Profit/(loss) before interest depreciation and exceptional items 2801.95 4085.09 3244.93 4470.91
Less: Interest 9.32 32.67 2.78 33.48
Depreciation and amortization expenses 897.26 1587.25 1482.41 2506.21
Exceptional items - - - -
Share of profit/ (loss) of Associates - - (20.90) (76.00)
Profit/(loss) for the year 1895.37 2465.17 1738.84 1855.22
Total tax expense (including current tax and deferred tax) - 6.16 28.08 (33.99)
Profit/(loss) after tax 1895.37 2459.01 1710.76 1889.21
Add: Other Comprehensive Income 53.11 (189.73) 60.38 (173.12)
Total Comprehensive Income for the year 1948.48 2269.28 1771.14 1716.09
Earning Per Share (in Rs.) (Basic & Diluted) 3.98 5.16 3.69 4.15

2. Transfer to Reserves

The Board of Directors of the Company has not transferred any amount to the Reservesfor the year under review.

3. Results of Operations and the State of Company's affairs

During the year under review the total revenue from operations was Rs. 11537.63Million on standalone basis and Rs. 12255.96 Million on consolidated basis as compared tothe last year's revenue of Rs. 12402.53 Million on standalone basis and Rs. 13074.04Million on consolidated basis respectively. The Post-Tax Profit of your Company was Rs.1895.37 Million on standalone basis and Rs. 1710.76 Million on consolidated basis ascompared to the last year's Post Tax Profit of Rs. 2459.01 Million on standalone basisand Rs. 1889.21 Million on consolidated basis respectively.

4. Operational Highlights

a) Zero Debt Company

The Company has maintained its status of being zero debt Company in current year.Despite the ongoing pandemic we are poised for long-term growth on the back of a strongbalance sheet.

b) Process improvements

The Company has removed mundane and routine tasks by automating processes and replacingthem with a system that requires minimum human interaction. Using automation the Companyhas improved business processes which has led to lower costs motivated employees andhappier customers. The Company has also introduced process improvement initiatives in SAPduring the year such as warehouse management Invoice cum receipt (ICR) and Inventoryserialisation.

5. Scheme of Amalgamation

The Board at its meeting held on February 17 2020 had approved the Composite Schemeof Amalgamation and Arrangement between the Company Hathway Cable and Datacom LimitedTV18 Broadcast Limited Network18 Media & Investments Limited Media18 DistributionServices Limited Web18 Digital Services Limited and Digital18 Media Limited and theirrespective Shareholders and Creditors ("Composite Scheme").

In accordance with the provisions of Regulation 37 of the Securities and Exchange Boardof India ("SEBI") (Listing Obligations and Disclosure Requirements) Regulations2015 ("the Listing Regulations") the Composite Scheme was filed with both BSELimited

("BSE") and National Stock Exchange of India Limited ("NSE") forobtaining no-objection letter from them.

The stock exchanges had returned the Composite Scheme stating that the Company mayapply to the stock exchanges once the Composite Scheme is in compliance with SEBIcirculars / SEBI Regulations.This pertained to the compliance by the Company and HathwayCable and Datacom Limited of the Minimum Public Shareholding ("MPS")requirement.

The Members may note that as on March 30 2021 the Company had achieved the MPScompliance. However considering that more than a year had passed from the time the Boardconsidered the Composite Scheme the Board of the Company decided not to proceed with thearrangement envisaged in the Composite Scheme.

6. Details of Material changes from the end of the financial year

No Material changes have taken place from the end of the financial year till the dateof this Report.

7. Dividend

The Board of Directors of the Company has not recommended any dividend on Equity Sharesfor the year under review.

The Dividend Distribution Policy of the Company is available on the Company's websiteand can be accessed at https://www.dennetworks.com/upload/code conduct/Dividend-Distribution-Policy.pdf

8. Management Discussion and Analysis Report

Management's Discussion and Analysis Report for the year under review as stipulatedunder the Listing Regulations is presented in a separate section forming part of theAnnual Report.

9. Credit Rating

During the financial year 2020-21 at the request of the Company ICRA Limited (CreditRating Agency) had withdrawn its rating assigned to the Line of Credit of the Company. Thecredit rating was no longer required as the current working capital facilities were fullysecured by fixed deposits and bank had given no objection certificate for withdrawal ofcredit rating. During the year under review the Company was not required to have creditrating.

10. Consolidated Financial Statement

In accordance with the provisions of the Companies Act 2013 ("the Act") andListing Regulations read with Ind AS-110 (Consolidated Financial Statement) Ind AS-28(Investments in Associates and Joint Ventures) the consolidated audited financialstatement forms part of the Annual Report.

11. Subsidiaries Joint Ventures and Associate Companies

During the year under review no company has become subsidiary and companies listed in"Annexure I" to this Report have ceased to be the subsidiaries of the Company.Further no company has become or ceased to be joint venture or associate of the Companyduring the year under review.

A statement providing details of performance and salient features of the financialstatements of Subsidiary/ Associate/ Joint Venture companies as per Section 129(3) of theAct is provided as "Annexure II" to this Report.

The audited financial statement including the consolidated financial statement of theCompany and all other documents required to be attached thereto is available on theCompany's website and can be accessed at https://dennetworks.com/ Investors#annual-report.The financial statements of the subsidiaries as required are available on the Company'swebsite and can be accessed at https://dennetworks.com/ Investors#annual-report.

The Company has formulated a Policy for determining Material Subsidiaries and the sameis available on the Company's website and can be accessed at https://www.dennetworks.com/upload/code conduct/Policy%20 on%20material%20subsidiary.pdf

12. Secretarial Standards

The Company has duly complied with the applicable Secretarial Standards i.e. SS-1 andSS-2 relating to 'Meetings of the Board of Directors' and 'General Meetings'respectively.

13. Directors' Responsibility Statement

The Board of Directors state that:

a) in the preparation of the annual accounts for the year ended March 31 2022 theapplicable accounting standards read with requirements set out under Schedule III to theAct have been followed and there were no material departures from the same;

b) the Directors have selected such accounting policies and applied them consistentlyand made judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 312022 and of the profit ofthe Company for the year ended on that date;

c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

d) the Directors have prepared the annual accounts on a going concern' basis;

e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and

f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.

14. Corporate Governance

The Company is committed to maintain the highest standards of Corporate Governance andadhere to the Corporate Governance requirements set out by the SEBI.

The report on Corporate Governance as stipulated under the Listing Regulations formspart of the Annual Report. The Certificate from a Practicing Company Secretary confirmingcompliance with the conditions of Corporate Governance is attached to the report onCorporate Governance.

15. Business Responsibility Report

As stipulated under the Listing Regulations the Business Responsibility Report (BRR)describing the initiatives taken by the Company from an environmental social andgovernance perspective is available on the Company's website and can be accessed athttps://dennetworks.com/Investors#annual- report.

16. Contracts or arrangements with Related Parties

All contracts / arrangements / transactions entered by the Company during the financialyear with related parties were in its ordinary course of business and on an arm's lengthbasis.

During the year the Company had not entered into any contract / arrangement /transaction with related parties which could be considered material in accordance with thepolicy of the Company on materiality of related party transactions or which is required tobe reported in Form No. AOC-2 in terms of Section 134(3)(h) read with Section 188 of theAct and Rule 8(2) of the Companies (Accounts) Rules 2014.

Members may refer Note No. 30 to the Standalone Financial Statement which sets outrelated party disclosures pursuant to Ind AS.

The Policy on Materiality of Related Party Transactions and on dealing with RelatedParty Transactions as approved by the Board is available on the Company's website and canbe accessed at http://dennetworks.com/Investors

During the year under review the policy was amended to align it with the amendments inthe Listing Regulations.

There were no materially significant related party transactions which could havepotential conflict with interest of the Company at large.

17. Corporate Social Responsibility

The Corporate Social Responsibility ("CSR") Committee's prime responsibilityis to assist the Board in discharging its corporate social responsibilities by way offormulating and monitoring implementation of the objectives set out in the 'CorporateSocial Responsibility Policy' ("CSR Policy").

The CSR Policy of the Company inter alia covers CSR vision and objective and alsoprovides for governance implementation monitoring and reporting framework.

During the year the Board of Directors at its meeting held on April 16 2021 hasapproved and adopted revised CSR Policy of the Company.

The CSR Policy of the Company is available on the Company's website and can be accessedat https://dennetworks.com/ upload/code conduct/CSR%20Policy-DEN.pdf

In terms of the CSR Policy the focus areas of engagement shall be affordablehealthcare solutions access to quality education promotion of sports communitydevelopments rural transformation environmental sustainability and other need basedinitiatives.

During the year the Company has spent Rs.16.17 Million (2% of the average net profitsof last three financial years) on CSR activities.

The Annual Report on CSR activities is annexed herewith and marked as "AnnexureIII" to this Report.

18. Risk Management

The Company has in place Risk Management Committee which has established a robust RiskManagement Policy and an adequate risk management infrastructure in place capable ofaddressing all the risks that the organization faces such as financial credit marketliquidity security IT (cyber risk) legal regulatory reputational risks and such otherrisks.

The Risk Management Committee manages monitors and reports on the principal risks anduncertainties that can impact its ability to achieve its strategic objectives. Keybusiness risks and their mitigation are considered as a part of the annual/strategicbusiness plans and is reviewed by the Risk Management Committee on frequent basis.

Further details on Risk Management activities are covered in Management Discussion andAnalysis section and Corporate Governance Report which form part of the Annual Report.

19. Internal Financial Controls

The Company has adequate internal financial controls commensurate with the size of thebusiness and nature of its operations designed to provide reasonable assurance withregard to the accuracy and completeness of the accounting records and timely preparationand provision of reliable financial statements.

The internal financial controls have been embedded in the business processes. Assuranceon the effectiveness of internal financial controls is obtained through managementreviews continuous monitoring by functional head and Group Internal Audit Team as well assample testing of the internal financial control systems by the independent Auditorsduring the course of their audits.

The Audit Committee quarterly reviews adequacy and effectiveness of Company's InternalControls and monitors the implementation of audit recommendations if any.

20. Directors and Key Managerial Personnel

In accordance with the provisions of the Act and the Articles of Association of theCompany Shri Sameer Manchanda (DIN: 00015459) and Shri Saurabh Sancheti (DIN: 08349457)Directors of the Company retire by rotation at the ensuing Annual General Meeting. TheBoard of Directors on the recommendation of the Nomination and Remuneration Committee("NRC") has recommended their re-appointment.

The Board of Directors based on performance evaluation and as per the recommendationof the NRC has commended the re-appointment of Shri Rajendra Dwarkadas Hingwala (DIN:00160602) as an Independent Director of the Company for a second term of 5 (five)consecutive years effective December 21 2022 on completion of his current term ofoffice. Further the Board has also sought requisite approval of the Members pursuant toRegulation 17(1A) of the Listing Regulations to continuation of Shri Rajendra DwarkadasHingwala as an Independent Director on the Board who would be attaining the age of 75years during the second term of office. In the opinion of the Board he possessesrequisite expertise integrity and experience (including proficiency) for appointment asan Independent Director of the Company and the Board considers that given hisprofessional background experience and contributions made by him during his tenure thecontinued association of Shri Rajendra Dwarkadas Hingwala would be beneficial to theCompany. Further Shri Rajendra Dwarkadas Hingwala meets the description of the role andcapabilities required of an independent director identified by the NRC.

During the year under review Shri Sameer Manchanda expressed his desire not to seekre-appointment as Managing Director of the Company for a fresh term after the expiry ofhis term as Managing Director of the Company on September 9 2021. However Shri SameerManchanda continues to be the Chairman and Non-Executive Director of the Company witheffect from September 10 2021. The Board places on record its immense appreciation forhis contribution towards the growth of the Company during his tenure as the ManagingDirector of the Company.

During the year under review based on the recommendation of the NRC the Boardappointed Ms. Hema Kumari as the Company Secretary & Compliance Officer of the Companywith effect from October 15 2021 in place of Shri Jatin Mahajan who resigned as theCompany Secretary & Compliance Officer of the Company with effect from October 142021. The Board placed its appreciation for the services rendered by Shri Jatin Mahajanduring his tenure as the Company Secretary & Compliance Officer of the Company.

The Company has received declarations from all Independent Directors of the Companyconfirming that they meet the criteria of independence prescribed under the Act and theListing Regulations.

The Company has devised inter alia the following Policies viz:

a) Policy for Selection of Directors and determining

Directors' independence; and

b) Remuneration Policy for Directors Key Managerial Personnel Senior Management andother employees.

The aforesaid policies are available on the Company's website and can be accessed athttps://dennetworks.com/upload/ code conduct/Policy%20for%20Selection%20of%20Directors.%20Remuneration%20Policv.%20Policv%20on%20Board%20diversity%20and%20Performance- evaluation-of-IDs-and-Board.pdf.

The Policy for selection of Directors and determining Directors' independence sets outthe guiding principles for the NRC for identifying persons who are qualified to becomeDirectors and to determine the independence of Directors while considering theirappointment as Independent Directors of the Company. The Policy also provides for thefactors in evaluating the suitability of individual Board members with diverse backgroundand experience that are relevant for the Company's operations. There has been no change inthe policy during the current year.

The Remuneration Policy for Directors Key Managerial Personnel Senior Management andother employees sets out the guiding principles for the NRC for recommending to the Boardthe remuneration of the Directors Key Managerial Personnel Senior Management and otheremployees of the Company. There has been no change in the policy during the current year.

21. PerformanceEvaluation

The Company has a policy for performance evaluation of the Board Committees and otherindividual Directors (including Independent Directors) which include criteria forperformance evaluation of Directors.

In accordance with the manner of evaluation specified by the NRC the Board carried outannual performance evaluation of the Board its Committees and Individual Directors. TheIndependent Directors carried out annual performance evaluation of the Chairperson thenon-independent directors and the Board as a whole. Each Committee self- evaluated its ownperformance and submitted its report of self-evaluation to the NRC. The NRC furtherevaluated based on self-evaluation reports submitted by various Committees and submittedits consolidated report on Committees evaluation to Board of Directors.

22. Auditors and Auditors' Report

A. Statutory Auditors

M/s. Chaturvedi & Shah LLP Chartered Accountants (Firm Registration Number101720W/W100355) were appointed as Auditors of the Company for a term of 5 (five)consecutive years at the Annual General Meeting held on September 23 2019. The Auditorshave confirmed that they are not disqualified from continuing as Auditors of the Company.

The Notes on financial statement referred to in the

Auditors' Report are self-explanatory and do not call for any further comments. TheAuditors' Report does not contain any qualification reservation adverse remark ordisclaimer.

B. Secretarial Auditors

The Board had appointed M/s. NKJ & Associates Company Secretaries to conductSecretarial Audit for the financial year 2021-22. The Secretarial Audit Report for thefinancial year ended March 312022 is annexed herewith and marked as "AnnexureIV" to this Report. The Secretarial Audit Report does not contain any qualificationreservation adverse remark or disclaimer.

C. Cost Auditors

The Board has appointed M/s. Ajay Kumar Singh & Company Cost Accountants (FirmRegistration no. 000386) as Cost Auditors of the Company for conducting the audit of thecost records of the Company for the financial year 2022-23 under Section 148 of the Actread with the Companies (Cost Records and Audit) Rules 2014.

In accordance with the provisions of Section 148(1) of the Act read with the Companies(Cost Records and Audit) Rules 2014 the Company has maintained cost accounts andrecords.

23. Disclosures

A. Meetings of the Board

Six meetings of the Board of Directors were held during the year. The particulars ofthe meetings held and attended by each Director are detailed in the Corporate GovernanceReport.

B. Audit Committee

The Audit Committee of the Company comprises Shri Ajaya Chand (Chairman) Shri AtulSharma Dr. (Ms.) Archana Niranjan Hingorani and Shri Saurabh Sancheti. During the yearall the recommendations made by the Audit Committee were accepted by the Board.

C. Corporate Social Responsibility Committee

The Corporate Social Responsibility Committee of the Company comprises Shri AjayaChand (Chairman) Dr. (Ms.) Archana Niranjan Hingorani and Shri Sameer Manchanda.

D. Nomination and Remuneration Committee

During the year under review the Board re-constituted the Nomination and RemunerationCommittee of the Company to comply with the requirements of the Listing Regulations. TheNomination and Remuneration Committee of the Company comprises Shri Ajaya Chand(Chairman) Dr. (Ms.) Archana Niranjan Hingorani and Shri Sameer Manchanda.

E. Stakeholders' Relationship Committee

The Stakeholders' Relationship Committee of the Company comprises Shri Ajaya Chand(Chairman) Dr. (Ms.) Archana Niranjan Hingorani and Shri Sameer Manchanda.

Details of the composition of other Committees are given in the Corporate GovernanceSection of the Annual Report.

F. Particulars of loans given investments made guarantees given and securitiesprovided

Particulars of loans given investments made guarantees given and securities providedalong with the purpose for which the loan or guarantee or security provided is proposed tobe utilised by the recipient are provided in the Standalone Financial Statement (Pleaserefer Note 39 to the Standalone Financial Statement).

G. Vigil Mechanism

The Company promotes ethical behaviour in all its business activities. Towards thisthe Company has adopted a Policy on Vigil Mechanism and whistle blower policy. Protecteddisclosures can be made by a whistle blower through an e-mail or a letter to the Vigilanceand Ethics Officer or to the Chairman of the Audit Committee/CEO. The Audit Committee alsoreviews complaints/issues (if any) raised through Vigil Mechanism or by any Whistle bloweron a quarterly basis.

The Vigil Mechanism and Whistle Blower Policy is available on the Company's website andcan be accessed at https://dennetworks.com/upload/codeconduct/Whistle%20Blower%20Policy-DEN.pdf.

During the year under review no protected disclosure concerning any reportable matterin accordance with the Vigil Mechanism and Whistle Blower Policy of the Company wasreceived by the Company.

24. Prevention of Sexual Harassment at Work Place

In accordance with the requirements of the Sexual Harassment of Women at Workplace(Prevention Prohibition & Redressal) Act 2013 ("POSH Act") and Rules madethereunder the Company has in place a policy which mandates no tolerance against anyconduct amounting to sexual harassment of women at workplace. The Company has constitutedInternal Committee(s) to redress and resolve any complaints arising under the POSH Act.

There were no cases/complaints filed during the financial year under POSH Act.

25. Conservation of Energy Technology Absorption and Foreign Exchange Earnings andOutgo

Pursuant to Section 134(3)(m) of the Act read with Rule 8(3) of the Companies(Accounts) Rules 2014 relevant disclosure are given below:

A. Conservation of Energy:

i) Steps taken for conservation of energy:

During the year under review the Company was not engaged in any manufacturing orprocessing activity. Considering the nature of the Company's business there is noreporting to be made on conservation of energy in its operations.

Notwithstanding this the Company recognises the importance of energy conservation indecreasing the adverse effects of global warming and climate change. The Company carrieson its activities in an environmental friendly and energy efficient manner.

ii) Steps taken by the Company for utilizing alternate sources of energy:

NIL

iii) The capital investment on energy conservation equipment:

NIL

B. Technology absorption:

i) Major efforts made towards technology absorption

The Company is conscious of implementation of latest technologies in key working areas.Technology is ever- changing and employees of the Company are made aware of the latestworking techniques and technologies through workshops group e-mails and discussionsessions for optimum utilization of available resources and to improve operationalefficiency. The Company has not entered into any technology agreement or collaborations.

ii) The benefits derived like product improvement cost reduction product developmentor import substitution:

None

iii) Information regarding imported technology (Imported during last three years):

The Company has not imported any technology during the last three years.

iv) Expenditure incurred on research and development:

None

C. Foreign Exchange Earnings and Outgo:

Foreign Exchange earned in - Nil

terms of actual inflows

Foreign Exchange outgo in - Rs. 59.63 Million

terms of actual outflows

26. Annual Return

The Annual Return of the Company as on March 31 2022 is available on the Company'swebsite and can be accessed at http://dennetworks.com/Investors#annual-report

27. Particulars of Employees and related disclosures

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 astatement showing the names of top ten employees in terms of remuneration drawn and namesand other particulars of the employees drawing remuneration in excess of the limits setout in the said rules forms part of this Report.

Disclosures relating to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 forms part of this Report.

Having regard to the provisions of the second proviso to Section 136(1) of the Act andas advised the Annual Report excluding the aforesaid information is being sent to theMembers of the Company. Any Member interested in obtaining such information may addresstheir e-mail to investorrelations@denonline.in

28. General

The Board of Directors state that no disclosure or reporting is required in respect ofthe following matters as there were no transactions or applicability pertaining to thesematters during the year under review:

i) Details relating to deposits covered under Chapter V of the Act.

ii) Issue of equity shares with differential rights as to dividend voting orotherwise.

iii) Issue of shares (including sweat equity shares and Employees' Stock OptionsSchemes) to employees of the Company under any scheme.

iv) Significant or material orders passed by the Regulators or Courts or Tribunalswhich impact the going concern status and Company's operations in future.

v) Fraud reported by the Auditors to the Audit Committee or the Board of Directors ofthe Company.

vi) Scheme of provision of money for the purchase of its own shares by employees or bytrustees for the benefit of employees.

vii) Payment of remuneration or commission from any of its holding or subsidiarycompanies to the Managing Director of the Company.

viii) change in the nature of business of the Company.

ix) Instances of transferring the funds to the Investor Education and Protection Fund.

x) Issue of debentures/bonds/warrants/any other convertible securities.

xi) Details of any application filed for corporate insolvency under CorporateInsolvency Resolution Process under the Insolvency and Bankruptcy Code 2016.

xii) Instance of one-time settlement with any Bank or Financial Institution.

xiii) Statement of deviation or variation in connection with preferential issue.

29. Acknowledgement

The Board of Directors would like to express their sincere appreciation for theassistance and co-operation received from the financial institutions banks Governmentauthorities business partners customers vendors and Members during the year underreview. The Board of Directors also wish to place on record their deep sense ofappreciation for the committed services by the Company's executives staff and workers.

For and on behalf of the Board of Directors

Sameer Manchanda

Chairman & Non-Executive Director

DIN: 00015459

Date: April 13 2022

Place: New Delhi

.