You are here » Home » Companies » Company Overview » Diligent Media Corporation Ltd

Diligent Media Corporation Ltd.

BSE: 540789 Sector: Media
BSE 00:00 | 01 Jul 3.00 0






NSE 00:00 | 01 Jul 3.00 -0.15






OPEN 3.15
VOLUME 14875
52-Week high 3.88
52-Week low 1.67
P/E 1.48
Mkt Cap.(Rs cr) 35
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 3.15
CLOSE 3.00
VOLUME 14875
52-Week high 3.88
52-Week low 1.67
P/E 1.48
Mkt Cap.(Rs cr) 35
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Diligent Media Corporation Ltd. (DNAMEDIA) - Director Report

Company director report

To the Members

Your Directors present the 15th Annual Report of your Company together with AuditedFinancial Statements for the year ended March 31 2020 prepared as per Indian AccountingStandards prescribed under Section 133 of the Companies Act 2013.


The financial performance of your Company for the year ended March 31 2020 issummarized below:

(Rs in Lakhs)

Particulars 31-3-2020 31-3-2019
Revenue from Operations 127 153
Other Income - -
Total Revenues 127 153
Total Expenses 117 137
Profit before tax 10 16
Tax Expenses - -
Net Profit after tax 10 16
Profit/(Loss) from discontinued Operations (6486) (5779)
Profit/(Loss) for the year (6476) (5763)

Note: Financial figures for year ended March 31 2019 have been restated in view ofdiscontinuation of Printing & Publication business operations since October 2019.

During FY 2015-16 your Company had issued Non-Convertible Debentures (NCDs) of nominalvalue of Rs. 250 Crores. The said NCDs along with interest thereon resulting in totaloutgo of Rs. 427.25 Crores became due for redemption on June 30 2020. The Companymanagement is in discussions with the NCD holder for extension for repayment of NCDs.Apart from default in repayment of NCDs as mentioned above and COVID 19 impact asmentioned herein there have been no material changes and commitments that have occurredafter close of the financial year till the date of this report which may have an adverseeffect the financial position of the Company.

Based on internal financial control framework and compliance systems established in theCompany verified by the statutory and internal auditors and reviews performed by themanagement and/or the Audit Committee of the Board your Board is of the opinion thatCompany's internal financial controls were adequate and operating effectively during thefinancial year 2019-20.

COVID - 19

In the last month of FY 2020 the COVID-19 pandemic developed rapidly into a globalcrisis forcing governments to enforce lockdowns of all economic activity. While Company'sPrinting & Publication business has been suspended since October 2019 the lockdownhas resulted in delay in recovery of outstanding receivables and disposal of businessassets in terms of power given under Special Resolution passed by the Shareholders at the14th AGM held on September 19 2019. Subject to business scenario in view of COVID19impact and other multifarious factors it is expected that the disposal of business assetswill take place in FY 2020-21.


In view of the carry forward losses your Board express their inability to recommend anydividend for the year under review. Further no amount is proposed to be transferred toreserves.


During the year under review your Company re-worked its business strategy to restrictthe quantum of loss and work towards reducing the same to attain better sustainabilityover next couple of years. As a step towards increasing operational efficiency yourCompany started focusing both on cost optimization as well as revenue maximization. Inline with the revised business strategy and based on evaluation of performance of variouseditions your Company suspended printing of publication of all editions of DNA Newspaperand weekly magazine Zee Marathi Disha with effect from October 2019. As part of thebusiness strategy your Company proposes to switch on toll printing model and concentrateon online News Media business.

The process for sale of the business assets of the Company comprising of land buildingand plant & machinery as per authority granted by the Shareholders vide Specialresolution passed at the 14th AGM held on September 19 2019 is delayed mainly due toon-going litigation initiated by workmen under Industrial Dispute Act and other alliedlabour laws and on-going business situation due to COVID-19.


During the year under review ICRA Limited downgraded rating assigned by it to theNon-Convertible Debentures (of principal amount of Rs. 250 Crores) from 'ICRA BBB (SO)Negative' to 'ICRA BB (CE) Negative' and the Short Term Nonfund based facility (of Rs. 20Crores) from 'ICRA A3(SO)' to 'ICRA A4'. The said rating which was based on strength ofCorporate Guarantee provided by Zee Media Corporation Ltd a group Company was downgradeddue to futher weakening in the financial flexibility of the Essel Group Promoters amidthe high pledge shareholding as well as slower than expected progress on assetmonetization.


Your Company is in compliance with the applicable Corporate Governance requirementsmentioned under Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 ('Listing Regulations') and Companies Act 2013.Additionally your company has complied with the requirements of applicable SecretarialStandards issued by the Institute of Company Secretaries of India.

A Report on Corporate Governance as stipulated in the Listing Regulations as also aManagement Discussion and Analysis Report forms part of this Annual Report. Certificatefrom the Statutory Auditors of the Company M/s B S Sharma & Co. CharteredAccountants confirming compliance with the provisions of Corporate Governance asstipulated under the Listing Regulations is annexed to the said Corporate GovernanceReport.

In compliance with the requirements of the Companies Act 2013 and the ListingRegulations your Board had approved various Codes and Policies including Code of Conductfor Directors & Senior Management Policy for determining Material Events Policy forPreservation of Documents and Archival of Records Related Party Transaction PolicyWhistle Blower and Vigil Mechanism Policy and Remuneration Policy. Further in accordancewith SEBI (Prohibition of Insider Trading) Regulations 2015 your Board had approved andimplemented Insider Trading Code and Policy on Fair Disclosure of Unpublished PriceSensitive Information. All these Codes and Policies along with the terms and conditions ofappointment of Independent Directors and brief on Directors Familiarization Programs canbe viewed on Company's website


As at March 31 2020 your Board comprised of 4 (Four) Directors including three (3)Independent Directors and one (1) Non-Executive Director. Independent Directors providedeclarations both at the time of appointment and annually confirming that they meet thecriteria of independence as prescribed under Companies Act 2013 and Listing Regulations.Additionally as per Listing Regulations the Independent Directors in the annualconfirmation issued in April 2020 had confirmed that there are no circumstances orsituation which exist or may be reasonably anticipated that could impair their ability todischarge their duties with an objective independent judgement and without any externalinfluence. During FY 1920 your Board met 4 (four) times details of which are available inthe Corporate Governance Report annexed to this report.

During the year under review Mrs. Uma Mandavgane resigned as Independent Director witheffect from May 17 2019 and Mr. A V Ramachandran Executive Director resigned with effectfrom December 13 2019. Your Board places on record their appreciation for contributionsof Mrs. Uma Mandavgane and Mr. A V Ramachandran during their tenure as Directors of theCompany.

Further subsequent to March 31 2020 your Board had approved appointment of Mr.Nishikant Upadhyay and Mr. Ronak Jatwala as Additional Directors in the category ofNon-Executive Non-Independent Directors of the Company with effect from July 30 2020. Asper Section 161 of the Companies Act 2013 Mr. Nishikant Upadhyay and Mr. Ronak Jatwalashall hold the office of Director till the ensuing Annual General Meeting. Your Companyhas received notice from Member(s) proposing their appointment and requisite proposalsseeking your approval for the appointment of these Directors forms part of the Notice ofensuing Annual General Meeting. Your Board recommends these proposals for approval ofShareholders.

As per Section 152 of the Companies Act 2013 Mr. Dinesh Garg retires by rotation atthe ensuing Annual General Meeting and being eligible has offered himself forre-appointment. Your Board recommends his re-appointment.

As at March 31 2020 Mr. Ankit Shah Company Secretary is Key Managerial Personnel ofthe Company in compliance with the requirements of Section 203 of the Companies Act 2013.During the year under review (i) Mr. Sanjeev Garg resigned as Chief Executive Officer witheffect from October 11 2019; (ii)

Mr. A V Ramachandran Executive Director resigned as Chief Executive Officer witheffect from December 13 2019; and (iii) Mr. Dinesh Agarwal resigned as Chief FinancialOfficer with effect from December 17 2019.

The resultant vacancy in the office of Key Managerial Personnel was filled by the Boardwith appointment of Mr. Shikhar Rajan as Chief Executive Officer and Mr. Rajendra Bathulaas Chief Financial Officer of the Company with effect from July 30 2020.


At a separate meeting of Independent Directors held without presence of other Directorsand management the Independent Directors had based on various criteria evaluatedperformance of the Board and Board Committees and also performance of Executive Director.Independent Directors comment on outcome of evaluation process was taken on record by theBoard and further the Board had in compliance with the requirements of Companies Act2013 evaluated performance of all Independent Directors based on various parametersincluding attendance contribution etc. The details of the evaluation process forms partof the Corporate Governance Report annexed to this Report.


In compliance with the requirements of Companies Act 2013 and Listing Regulationsyour Board had constituted Audit Committee Nomination & Remuneration Committee andStakeholders Relationship Committee. Details of constitution of these Committees whichare in accordance with regulatory requirements have been uploaded on the website of theCompany. Further the details of constitution terms of reference number of meetings ofthe Board Committees held during Financial year ended on March 31 2020 along with thedetails of attendance of Committee Members therein forms part of the Corporate GovernanceReport annexed to this report.

Section 135 of the Companies Act 2013 mandating constitution of Corporate SocialResponsibility (CSR) Committee and CSR spend does not apply to the Company.


Statutory Audit: M/s. B. S. Sharma & Co. Chartered Accountants holding FirmRegistration No. 128249W were appointed as Statutory Auditors of the Company by theMembers at the 12 th Annual General Meeting held on July 20 2017 to hold such office forthe second term of five (5) years until the conclusion of 17th Annual General Meeting tobe held in the year 2022 subject to ratification by the Members at every Annual GeneralMeeting. Pursuant to an amendment to Section 139 of the Companies Act 2013 effective May7 2018 ratification by the Shareholders every year for the appointment of StatutoryAuditors was no longer required and accordingly the Notice of ensuing Annual GeneralMeeting does not include the proposal for seeking Shareholders approval for ratificationof Statutory Auditors appointment. The Company has received certificate of eligibilityfrom M/s. B. S. Sharma & Co. Chartered Accountants in accordance with the provisionsof the Companies Act 2013 read with rules thereunder along with a confirmation that theycontinue to hold valid Peer Review Certificate as required under Listing Regulations.

The report of the Statutory Auditors to the Members forming part of this Annual reportdoes not contain any qualification reservation or adverse remarks. The Auditors reporthowever incudes an Emphasis of Matters drawing members attention to various notes of Notesto Accounts of the company for FY 2020 which are self explantory. During FY 20 theStatutory Auditors had not reported any matter under Section 143(12) of the Companies Act2013 and therefore no disclosures are required pursuant to Section 134(3) (ca) of theCompanies Act 2013.

Secretarial Audit: In terms of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Secretarial Auditfor the financial year ended March 31 2020 was carried out by Mr. Satish K ShahPracticing Company Secretary (holding ICSI Certificate of Practice No. 3142). Copy of theSecretarial Audit report inter alia confirming compliance with applicable regulatoryrequirements by the Company during the financial year ended March 31 2020 is annexed tothis report. Additionally in compliance with the requirements of Listing Regulations asamended with effect from April 1 2019 the Secretarial Auditor had also provided AnnualSecretarial Compliance Report for financial year ended on March 312020 and the same wasfiled with Stock Exchanges.

The requirement of maintenance of Cost records and carry out Cost Audit as prescribedunder Section 148 of the Companies Act 2013 is not applicable to the Company.


The Company discontinued its Printing operations with effect from October 11 2019.However requisite information relating to Conservation of Energy and TechnologyAbsorption during the year till October 2019 as prescribed under Section 134(3) (m) of theCompanies Act 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 for theyear ended March 312020 is annexed to this Report as Annexure A.


As at March 31 2020 your Company had 52 employees. Due to discontinuation of Printingoperations and as part of other cost optimization measures an aggregate of 310 employeesforming part of editorial sales marketing and circulation team had resigned and theproposal for retrenchment of workmen is pending before Hon'ble Labor Court in view oflegal proceedings initiated by the workmen under Industrial Dispute Act and allied laborlaws.

The information required under the provisions of Section 197 of the Companies Act 2013read with Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 along with statement showing names and other particulars of top 10 employeesincluding employees drawing remuneration in excess of the limits prescribed under the saidrules is annexed to this report as Annexure B.


In accordance with Section 134(3)(n) of the Act the Company has framed a RiskManagement Policy to identify and assess the key risk areas. Considering suspension ofPrinting operations and revision in business strategy the management is in process ofreviewing and identifying risk areas which may threaten the existence of the Company.


i. Particulars of loans guarantees and investments: Particulars of loans guaranteesand investments made by the Company as required under Section 186(4) of the Companies Act2013 are given in Note No. 36 to the Financial Statements.

ii. Transactions with Related Parties: All contracts/ arrangements/transactions enteredby the Company during the financial year 19-20 with related parties were on arm's lengthbasis in the ordinary course of business and in compliance with applicable provisions ofthe Companies Act 2013 and Listing Regulations. During the year under review there havebeen no materially significant transactions of the types prescribed under Section 188(1)with related parties as defined under Section 2(76) of the Companies Act 2013 (Act) andaccordingly the information as prescribed under Section 134(3)(h) of the Act read withRule 8(2) of the Companies (Accounts) Rules 2014 in Form AOC-2 are not provided.

Related party transactions proposed to be entered into by the Company are placed beforethe Audit Committee for its approval and statement of all executed related partytransactions are placed before the Audit Committee for its review on quarterly basis.

iii. Internal Financial Controls and their adequacy: Your Company has implementedinternal financial controls and policies/processes for orderly and efficient conduct ofthe business including safeguarding of assets prevention and detection of frauds anderrors ensuring accuracy and completeness of the accounting records and the timelypreparation of reliable financial information.

iv. Deposits: Your Company has not accepted any public deposit as prescribed underChapter V of the Companies Act 2013.

v. Extract of Annual Return: Extract of Annual Return in Form MGT-9 as required underSection 92(3) of the Act read with Companies (Management & Administration) Rules 2014is annexed to this report as Annexure C In accordance with recent amendments to Section134 of the Companies Act 2013 (Act) Annual Return of the Company for Financial Yearended March 31 2020 will be available on the website of the Company

vi. Sexual Harassment: Your Company has zero tolerance towards sexual harassment atworkplace and has adopted a Policy on prevention prohibition and redressal of sexualharassment at workplace in line with the requirement of Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013 (POSH Act) and the Rulesthereunder. In accordance with POSH Act your Company has constituted Internal ComplaintsCommittee.

There was no complaint on sexual harassment during the year under review.

vii. Regulatory Orders: No significant or material orders were passed by any regulatorsor courts or tribunals which impact the going concern status and Company's operations infuture.


Pursuant to the requirement under Section 134 of the Companies Act 2013 in relationto the Annual Financial Statements for the Financial Year 2019-20 your Directors confirmthat:

a) The Financial Statements of the Company comprising of the Balance Sheet as at March31 2020 and the Statement of Profit & Loss for the year ended on that date have beenprepared on a going concern basis;

b) In preparation of the Financial Statements applicable accounting standards havebeen followed and there are no material departures;

c) Accounting policies selected were applied consistently and the judgments andestimates related to the financial statements have been made on a prudent and reasonablebasis so as to give a true and fair view of the state of affairs of the Company as atMarch 31 2020 and of the loss of the Company for the year ended on that date;

d) Proper and sufficient care has been taken for maintenance of adequate accountingrecords in accordance with the provisions of the Act to safeguard the assets of theCompany and for preventing and detecting fraud and other irregularities;

e) Requisite Internal financial controls were laid down and that such financialcontrols are adequate and operating effectively; and

f) Proper systems have been devised to ensure compliance with the provisions of allapplicable laws and such systems are adequate and operating effectively.


Your Board takes this opportunity to place on record its appreciation for thededication and commitment of employees shown at all levels. Your Directors also expresstheir gratitude for the valuable support and co-operation extended by all stakeholdersincluding banks financial institutions customers vendors service providers andregulatory authorities.

For and on behalf of the Board
Dinesh Kumar Garg
DIN: 02048097
Nishikant Upadhyay
DIN: 07779721
Place: Mumbai
Date : November 12 2020