To the Members
Your Directors are pleased to present the 30th (thirtieth) Annual Report ofyour Company covering the business and operations of the Company and the Annual AuditedFinancial Statements for the Financial Year ended March 31 2018 prepared as per IndianAccounting Standards prescribed under Section 133 of the Companies Act 2013.
1. FINANCIAL RESULTS
The Financial Performance of your Company for the Financial Year ended March 31 2018is summarized below: (` In Lacs)
| || |
Standalone Year Ended
Consolidated Year Ended
|Particulars ||Year ended ||Year ended ||Year ended ||Year ended |
| ||March 31 2018 ||March 31 2017 ||March 31 2018 ||March 31 2017 |
|Sales & Services ||286260 ||194539 ||463416 ||301438 |
|Other Income ||6132 ||6948 ||5416 ||6150 |
|Total Income ||292392 ||201487 ||468832 ||307588 |
|Total Expenses ||306585 ||175694 ||478623 ||296639 |
|Profit/(Loss) before Tax & Prior Period Item ||(14193) ||25793 ||(9791) ||10949 |
|Prior Period Item ||- ||- ||- ||- |
|Profit/(Loss) before Tax ||(14193) ||25793 ||(9791) ||10949 |
|Profit from continuing operations before tax ||(14193) ||25793 ||(9791) ||10949 |
|Profit/(loss) from discontinued operations before tax ||18986 ||- ||- ||- |
|- Current tax Continuing operation ||(196) ||8529 ||225 ||9816 |
|- Deferred tax-Continuing operation ||(8785) ||475 ||(1526) ||(7079) |
|- Deferred tax-Discontinued operation ||10440 ||- ||- ||- |
|Profit from continuing operations after tax ||(5212) ||16789 ||(8490) ||8212 |
|Profit/(loss) from discontinued operations after tax ||8546 ||- ||- ||- |
|Profit/(Loss) after Tax ||3334 ||16789 ||(8490) ||8212 |
|Profit/(Loss) for the Year ||3334 ||16789 ||(8490) ||8212 |
|Add: Balance brought forward ||(139328) ||(156140) ||(126776) ||(136051) |
|Adjustment for Non-controlling interest ||- ||- ||986 ||994 |
|Adjustment for depreciation ||- ||- ||- ||- |
|Transferred from securities premium (capital reduction) ||154340 ||- ||154340 ||- |
|Add: Remeasurement of post employment benefits ||81 ||23 ||173 ||69 |
|Amount available for appropriations ||18427 ||(139328) ||20233 ||(126776) |
|Balance Carried Forward ||18427 ||(139328) ||20233 ||(126776) |
There have been no material changes and commitments that have occurred after close ofthe financial year till the date of this report which affects the financial position ofthe Company. During the year under review the Company concluded the Scheme of Arrangementamongst Videocon D2H Limited and Dish TV India Limited and their respective shareholdersand creditors in terms of the Order of the Hon'ble National Company Law Tribunal MumbaiBench dated July 27 2017 which has been dealt in this report.
Based on internal financial control framework and compliance systems established in theCompany and 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 effective during the financialyear 2017-18.
With a view to conserve the resources for future business requirements and expansionplans your Board is of the view that the current year's profit be ploughed back into theoperations and hence no dividend is recommended for the year under review. The Board ofyour Company has approved the Dividend Distribution Policy of the Company in terms ofRegulation 43A of the Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 (Listing Regulations') as applicable tothe top 500 Listed Companies. The said Policy of the Company sets out the parameters andcircumstances that will be taken into account by the Board in determining the distributionof dividend to its shareholders and/or retained profits earned by the Company. The policyis available on the website of the Company viz. http://www.dishd2h.com/corporate-governance/
3. BUSINESS OVERVIEW
The global growth has eased but remains robust and is projected to reach 3.1% in 2018.The International Monetary Fund (IMF) projects that advanced economies as a group willcontinue to swell above their potential growth rates this year and the next beforedecelerating while growth in emerging markets and developing economies will rise beforelevelling off.
India's economy which bottomed out due to the deceleration caused by one-time policyevents is now expected to re-emerge as the fastest growing one in Asia and clock a 7.3%rise in GDP in the current fiscal and further accelerate to 7.6% inFY_19-20.TheimplementationofGoodsandServices Tax (GST) encountered transitory headwindsand hampered the gross domestic output resulting in GDP growth of 6.7% as compared to7.1% in FY 16-17.
During FY 2017-18 Dish TV India Limited achieved yet another milestone by completingAmalgamation with Videocon D2H Limited on March 22 2018 to become India's largest DTHoperator in terms of subscriber base.
In the year under review your Company continued to make profits to the tune of Rs3334 lacs. This was achieved with a sustained focus on the customer satisfactionproviding good pack mix and having all the relevant channels available to thesubscribers. Introducing innovative packaging and making Hi-Definition (HD) moreaffordable were the key initiatives which ensured growth in gross subscribers. Customerservice and satisfaction continues to be the focal area for your Company. With growingdisposable income growth and improvements in technology our customers' viewing devicesalso keep on improving and hence their needs and expectations continue to evolve. At theother end of the spectrum new customers are coming in with the digitization drive. Wewill continue to empower our customers and transform their entertainment needs with thepower of digitization offering more channels On Demand Services and InteractiveTelevision Services. HD grew with digitisation on the back of increased sale of largetelevision screens wherein the viewing experience requires higher quality content. HDaudience contributes to higher revenues due to the premium pricing that such channelscommand. The HD subscriber base of the Company is at approx 3.5 million as of March 312018 which is 15% of the total subscriber base of the Company.
Customers are adopting the digital' offering in every aspect of a transactionlife cycle from initiation to culmination including researching for a product/servicebuying the product/service availing post-sales service and also providing feedback andreviews all online on company websites/e-commerce websites/social media and others. DishTV is trying to reach these digital' customer touch points strategically at everypoint of transaction.
We strongly believe that technology will be the game changer going forward for ourindustry and we are all geared up to adapt technological advancements and stay ahead ofthe curve. The Company is investing in the upgrade of technology to be ahead of marketplayers and achieve a balanced customer base.
The Company has strategic plans to attract digital and tactical digital consumers. TheCompany is planning to launch its own OTT platform and hybrid set-top boxes (pay TV + payOTT) to cater to this new segment. Though the segment is at quite a nascent stage theCompany plans to enter the potential market early on to exploit its large subscriber base.The Company will be targeting households with existing internet connections to build up onthe existing infrastructure. This year will also be about giving more power in the handsof the customer. Greater value will be provided with the introduction of benefits on longterm recharges. This would be a win-win situation for both subscriber and Company with theformer saving money and the latter improving retention. Finding means for maximizing valuefor the customer will always be the never ending quest which drives each and everyemployee of the Company.
The Ministry of Information and Broadcasting Government of India (MIB) vide its letterdated July 27 2018 has granted an interim extension to the DTH License of the Companyupto December 31 2018 or till the date of notification of "New DTH Guidelines"whichever is earlier.
4. SCHEME OF ARRANGEMENT AMONG VIDEOCON D2H LIMITED ("TRANSFERORCOMPANY") AND DISH TV INDIA LIMITED ("TRANSFEREE COMPANY") AND THEIRRESPECTIVE SHAREHOLDERS AND CREDITORS
The Year under review was a landmark year for Dish TV with the completion ofAmalgamation of Videocon D2H Limited with and into Company which became effective onMarch 22 2018 with October 1 2017 being the appointed date.
The Board of your Company and the Board of Videocon D2H Limited at their respectivemeetings held on November 11 2016 approved the Scheme of Arrangement amongst VideoconD2H Limited and Dish TV India Limited and their respective shareholders and creditors(Scheme') for amalgamation of Videocon D2H Limited into and with Dish TV IndiaLimited. The Scheme was made with a view to reduce operational costs increase operationalefficiencies and enable optimal utilization of various resources as a result of pooling offinancial managerial and technical resources and technologies of both the Companies.
The National Stock Exchange of India Limited and BSE Limited provided their NoObjection' to the said Scheme on March 1 2017 and March 2 2017 respectively.
Further the Board of Directors of both the Companies in order to provide greaterflexibility to the Scheme at its meeting held on May 24 2017 approved the proposal toamend the scheme by amending the clause 5.8.5 of the scheme. Pursuant to the saidamendment the GDRs to be issued by the Company pursuant to the Amalgamation can be listedon "Luxembourg Stock Exchange or London Stock Exchange or any Other StockExchange". The said amendment was placed before the Hon'ble National Company LawTribunal Mumbai Bench (NCLT') on June 7 2017 for approval. During the hearingbefore the Tribunal the said amendment was changed to "Luxembourg Stock Exchange orLondon Stock Exchange". The proposed Amalgamation had also been notified to theCompetition Commission of India (CCI) for its approval and CCI had given its approval forthe proposed transaction vide its letter dated May 4 2017. On May 12 2017 in a meetingconvened by the National Company Law Tribunal (NCLT) the Equity Shareholders of theCompany had also approved the Scheme for amalgamation of Videocon D2H Limited into Dish TVIndia Limited. Subsequently the Mumbai Bench of the Hon'ble NCLT at its hearing held onJuly 27 2017 approved the Scheme under the provisions of Sections 230 -232 and otherapplicable provisions of the Companies Act 2013. The Appointed date for the Scheme wastherein fixed as October 1 2017. Further the Ministry of Information and Broadcasting(MIB') the nodal Ministry vide its order dated December 15 2017 approved theaforesaid Amalgamation paving way for the creation of the largest listed media company inIndia taking into consideration the last reported revenue and EBITDA numbers of the twoDTH players on a pro-forma basis. Dish TV India Limited and Videocon D2H Limited reportedseparate revenue and EBITDA numbers which at a pro-forma level add up to Rs 60862 millionand Rs 19909 million for FY 2017-18
Taking further steps for giving effect to the Scheme of Arrangement for Amalgamation ofVideocon D2H Limited into and with Dish TV India Limited the Companies (Videocon D2HLimited and Dish TV India Limited) on March 22 2018 filed the Copy of the order datedJuly 27 2017 passed by the Hon'ble National Company Law Tribunal (NCLT) along with theApproved Scheme with the Registrar of Companies Mumbai Maharashtra. Accordingly uponcompletion of all the steps pursuant to the aforementioned Scheme read with the NCLTOrder Videocon D2H Limited has Amalgamated into and with Dish TV India Limited on March22 2018 which is the Effective date of the Scheme.
In compliance of order passed by Hon'ble National Company Law Tribunal dated July 272017 your Board at its meeting held on issued 857785642 fully paid up equity Shares ofthe Company of Rs 1/- (one each) as a consideration to the eligible equity shareholdersof Videocon D2H Limited. Further out of the issue of 857785642 fully paid equityshares the Board has allotted 775256159 fully paid equity Shares of Rs 1/- on March 262018 and kept the allotment of 82529483 equity shares in abeyance owing to certaincounter claim received by the Company. Post the allotment of the Shares the Company hadfiled necessary Application with the Stock exchange(s) for listing of the above-mentionedequity shares allotted pursuant to Scheme. BSE Limited (BSE') & National StockExchange of India Limited (NSE') vide their respective letters dated April 5 2018and April 6 2018 granted in-principal approval for listing of the aforesaid shares. Postcredit of shares in electronic mode the trading approval in respect of the abovementioned shares was received by the Company on April 10 2018. The equity shares soallotted are presently listed on NSE and BSE in India. In terms of the Scheme the ADSholders of Videocon D2H Limited had option to elect and to either receive the shares ofDish TV India Limited or the GDR to be issued by Dish TV India Limited. Accordingly theADS holders of Videocon D2H Limited were issued Global Depositary Receipts (the"GDRs") of Company. The effective date of issuance of GDRs was April 12 2018and the same were listed on the Professional Securities Market (PSM') of the LondonStock Exchange on April 13 2018.
Post receipt of all necessary approval(s) and in compliance of order passed by Hon'bleNational Company Law Tribunal (NCLT') dated July 27 2017 for Amalgamation ofVideocon D2H Limited into and with the Company the Board at its meeting held on March 262018 approved the issuance of 277095615 Global Depositary Receipts (the GDRs') tothe holders of American Depositary Shares (ADSs') of Videocon D2H Limited (each GDRrepresenting one equity share of the Company exchanged at a rate of approximately8.07331699 new GDRs for every one Videocon D2H Limited ADS (rounded off up to eightdecimal places). The underlying shares against each of the GDR's were issued in the nameof the Depository viz. Deutsche Bank Trust Company Americas.
This Amalgamation paved the way for the creation of the largest listed media company inIndia having 23 million subscribers and with 37% market share in the DTH segment. TheAmalgamation has come at a pertinent time with consumer spending picking up almost oneand a half years post the announcement of demonetization. A new era in fact has begun forboth the Indian economy and Dish TV India Limited as they both gear up to drive theconsumers increasing propensity to consume. The combined entity is expected to providebetter synergies and growth opportunities through deeper after-sales through Companymanaged centers distribution and technology capabilities and will also become a moreeffective partner for TV content providers in India. The Amalgamated Company's subscriberbase is a fair mix of urban semi-urban and rural subscribers that would enable it tobenefit from increased discretionary spending across categories. A healthier urban mixwould be beneficial to the revenue pool while at the same time a stable paying ruralbase would help buffer the platform from alternate technologies. Three well recognized andpowerful brands dishtv' d2h' and Zing' are now being marketedunder the Dish TV India Limited umbrella with each being favourably positioned in its keytarget markets. While dishtv has always had a high top-of-the-mind consumer brand recalld2h has had the advantage of having high brand loyalty in trade circles. Zing on the otherhand has been the undisputed leader when it comes to having tailor-made packages forregional audiences. Identifying the strengths of each brand the Company has beentargeting profitable growth while maintaining healthy competition and encouraging synergyin backend operations.
5. CAPITAL REDUCTION REDUCTION OF SECURITIES PREMIUM ACCOUNT FOR WRITINGOFF THE DEFICIT IN THE STATEMENT OF PROFIT & LOSS ACCOUNT
The Board of Directors of your Company at its meeting held on May 23 2016 approvedthe arrangement for reduction of the Securities Premium Account of the Company for writingoff the deficit in the statement of Profit and Loss Account. The reduction in sharecapital (securities premium account) does not prejudicially affect the Company or itsShareholders and does not in any way adversely affect the ordinary operations of theCompany or the ability of the Company to honor its commitments that may arise in theordinary course of business.
Upon receipt of No objection(s) of the Stock Exchanges (NSE & BSE) to the saidreduction and approval of Shareholders' of the Company vide Special Resolution datedSeptember 19 2016 the Company had filed necessary application with Hon'ble NationalCompany Law Tribunal Mumbai Bench (NCLT) for approval of the said Capital Reductionproposal. The Hon'ble NCLT vide its Order dated June 28 2017 had approved the saidreduction of share capital of the Company by way of utilizing the amount standing to thecredit of the Securities Premium Account for writing off deficit in the statement ofProfit and Loss account of the Company.
Accordingly the entire Securities Premium account amounting to Rs 15433965550(Rupees One Thousand Five Hundred Forty Three Crores Thirty Nine Lakhs Sixty Five ThousandFive Hundred and Fifty Only) as on March 31 2016 stands reduced for writing off deficitin the statement of Profit and Loss Account of the Company. Post receipt of the saidOrder necessary filings were made with the Stock Exchange(s) and Registrar of Companies.Necessary entries in the books of Accounts of the Company were made during the year underreview.
6. SUBSIDIARIES AND ASSOCIATE COMPANIES
As on March 31 2018 your Company had 1 (One) Wholly Owned Subsidiary 1 (One) JointVenture and 1 (One) Associate Company.
Subsidiary in Sri Lanka:
Your Company upon the approval of Board of Directors incorporated a Joint Venture(JV') Company with Satnet (Private) Limited a Company incorporated under the Lawsof Sri Lanka in the name and style of Dish T V Lanka (Private) Limited' forproviding Direct to Home Services in Sri Lanka on April 25 2012 with a paid up sharecapital of 1 million Sri Lankan Rupees. Your Company holds 70% of the paid-up sharecapital and Satnet (Private) Limited holds 30% of the paid-up share capital in Dish T VLanka (Private) Limited. Dish T V Lanka (Private) Limited operates under the requisitelicenses and permissions obtained from regulatory authorities. The Company has also beenregistered as a Board of Investment (BOI') approved Company in Sri Lanka. Theregistration with BOI grants various benefits to the Company.
Subsidiary in India:
Your Company upon the approval of Board of Directors and the Members of the Companyacquired the entire share capital of Xingmedia Distribution Private Limited ('Xingmedia')on March 24 2014. Upon requisite approvals the name of Xingmedia has been changed toDish Infra Services Private Limited' (Dish Infra'). Post approval of Membersof the Company by way of Special Resolution passed by Postal Ballot on February 3 2015the non-core business of the Company (undertaking pertaining to the provision of infrasupport services to the subscribers for facilitating the DTH services including theinstruments which are required for receiving DTH signals such as set top boxes(STB) dishantenna Low Noise Boxes (LNB) and other customer related services including call centreservices and repairs) has been transferred to Dish Infra with effect from April 1 2015.Further during the Financial Year 2017-18 with a view to harmonize the existing businessmodel of the Company consequent to Amalgamation approval of the members of the Companywas sought by way of Special Resolution for transferring the Non-Core Business undertakingof Infra Support Services (including set top boxes dish antenna etc. and relatedservices) to be acquired from Videocon D2H Limited to Dish Infra Services Private Limitedon a going concern basis. The Shareholders approved the said Special Resolution withrequisite majority on September 27 2017.
In compliance with the provision(s) of Regulation 24 of the Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015 yourboard had appointed Mr. Lakshmi Chand an Independent Director of the Company as anIndependent Director on the Board of Dish Infra Services Private Limited. Upon Resignationof Mr. Chand with effect from August 17 2018 your board upon nomination by the Companyappointed Dr. (Mrs.) Rashmi Aggarwal as an Independent Director on the Board of Dish Infra(Company's material non-listed Indian Subsidiary).
Associate Company in India:
Your Company upon the approval of Board of Directors incorporated an Associate Companyin the name and style of C&S Medianet Private Limited' on May 5 2016. C&SMedianet Private Limited's initial paid up capital is Rs 100000. Your Company holds 48%of the initial capital and Siti Networks Limited also hold 48% of the initial capital. Thesaid Company acts as a knowledge center for the distribution industry whereby assistingthem in various business facets including packaging content acquisition regulatoryinteraction etc. The said Company has commenced its operations during the year underreview.
Your Company upon approval of the Board has changed the nomination on the Board ofC&S Medianet Private Limited and appointed Mr. Ravi Bhushan Puri (DIN: 06686381) asthe Nominee Director in place of Mr. Mukesh Mittal.
Apart from the above no other Subsidiary / Joint-venture/Associate was formed ordivested during the financial year 2017-18.
Audited Accounts of Subsidiary Companies:
Your Company has prepared the Audited Consolidated Financial Statements in accordancewith Section 129(3) of the Companies Act 2013 read with applicable Accounting Standardsand Listing Regulations 2015. The statement pursuant to Section 129(3) of Companies Act2013 and Rule 5 of Companies (Accounts) Rules 2014 highlighting the summary of thefinancial performance of the subsidiaries is annexed to this Report.
As required under the Indian Accounting Standard issued by the Institute of CharteredAccountants of India (ICAI') and applicable provisions of the Listing Regulationsthe Audited Consolidated Financial Statements of the Company reflecting the Consolidationof the Accounts of its subsidiaries are included in this Annual Report. Further astatement containing the salient features of the financial statements of the subsidiariesand associate in the prescribed format AOC-1 is appended to this report. In accordancewith Section 136 of the Companies Act 2013 the audited financial statements includingthe consolidated financial statements and related information of the Company and auditedaccounts of subsidiaries are available on the website of the Company viz. http://www.dishd2h.com. These documents will also be available for inspection during business hoursat the Registered Office of the Company.
Your Company has a policy for determining Material Subsidiaries in place. As on March31 2018 the Company has only one Material Subsidiary viz. Dish Infra Services PrivateLimited. The Policy for determining Material Subsidiaries is available on the Company'swebsite viz. http://www.dishd2h. com and is accessible at http://www.dishd2h.com/media/1324/policyonmaterialsubsidiary.pdf
7. CAPITAL STRUCTURE
During the year under review your Company:
Consequent to receipt of necessary approval and in compliance of orderpassed by Hon'ble National Company Law Tribunal Mumbai Bench dated July 27 2017 forAmalgamation of Videocon D2H Limited into and with the Company the Board on March 262018 issued 857785642 fully paid up equity Shares of the Company of Re. 1/- (one each)as a consideration to the eligible equity shareholders of Videocon D2H Limited. Furtherout of the issue of 857785642 fully paid equity shares the Board has allotted775256159 fully paid equity Shares of Re.1/- on March 26 2018 and kept the allotment of82529483 equity shares in abeyance owing to certain counter claim received by theCompany.
Issued and allotted 45370 fully paid equity shares upon exercise of StockOption by the eligible Employees of the Company pursuant to the Employee Stock OptionScheme - 2007 (ESOP - 2007') of the Company and these shares were duly admitted fortrading on both the stock exchanges viz. NSE and BSE.
Upon receipt of valid second call money from the concerned shareholders inrespect of Rights Issue the Company converted 695 equity shares from Rs 0.75 each paid upto Rs 1 each fully paid up. The Company had come up with Right Issue in Financial Year2008-09 for 518149592 equity shares of Rs 1 each issued at Rs 22 per share (includingpremium of Rs 21 per share) payable in three installments. Pursuant to the issue andallotment of equity shares under ESOP scheme allotment of shares pursuant to Scheme andconversion of partly paid equity shares the paid up share capital of your Company duringthe year has increased from:
Rs 1065955532 (comprising of 1065934528 fully paid up equity sharesof Rs 1 each 15262 equity shares of Rs 1 each paid up Rs 0.75 per equity share &19115 equity shares of Rs 1 each paid up Rs 0.50 per equity share) to
`1841257234.75(comprisingof1841236752 fully paid up equity shares ofRs 1 each 14567 equity shares of Rs 1 each paid up Rs 0.75 per equity share &19115 equity shares of Rs 1 each paid up Rs 0.50 per equity share)
Further during the year under review consequent to Amalgamation the Authorised ShareCapital of erstwhile Videocon D2H Limited amounting to `_ 5000000000/- (Rupees Fivehundred Crore) stood merged and consolidated with the Authorised Share Capital of theCompany and consequently the Authorised Share Capital of the Company increased from Rs1500000000/- (Rupee One Hundred and Fifty Crores) divided into 1500000000 (RupeesOne Hundred and fifty Crores) Equity shares of Rs 1 (Rupee one) each to Rs 6500000000/-(Rupees Six hundred and Fifty Crore) divided into 6500000000 (Rupees Six hundred andFifty Crore) Equity shares of Rs 1 (Rupee one) each.
Listing of Company's Securities
Your Company's fully paid up equity shares continue to be listed and traded on NationalStock Exchange of India Limited (NSE') and BSE Limited
(BSE'). Both these Stock Exchanges have nationwide trading terminals and hencefacilitates the shareholders/investors of the Company in trading the shares. The Companyhas paid the annual listing fee for the Financial Year 2018-19 to the said StockExchanges. The Company has also paid the annual maintenance fee to the Luxembourg StockExchange in respect of its Global Depository Receipts (GDR') program for the year2018.
Further Consequent to Amalgamation of Videocon d2h Limited into and with the Companyyour Company has issued new Global Depositary Receipts (the "GDRs") to theholders of American Depositary Shares ("ADSs") of Videocon D2H Limited which arelisted on the Professional Securities Market ("PSM") of the London StockExchange. Necessary fees in relation to the GDR's of the Company listed on London StockExchange has been paid.
Your Company has arrangements with National Securities Depository Limited (NSDL')and Central Depository Services (India) Limited (CDSL') the Depositories forfacilitating the members to trade in the fully paid up equity shares of the Company inDematerialized form. The Annual Custody fees for the Financial Year 2018-19 has been paidto both the Depositories.
Re-classification from Promoter Group Category to Public Category
The Board at its meeting held on August 12 2016 and January 30 2017 had taken onrecord the re-classification application(s) received from the Outgoing Promoters (Dr.Subhash Chandra Mr. Ashok Kumar Goel and Mr. Ashok Mathai Kurien along-with theirrespective family members / relatives the entities controlled by them and persons actingin concert with them who were categorized as Promoters of the Company). Subsequently theBoard approved the Postal Ballot Notice for seeking the consent of the Members of theCompany for the said re-classification of the Outgoing Promoters from "Promoter andPromoter Group" category to the "Public" category. The Members of theCompany accorded its approval to the said re-classification on November 23 2017 in termsof Regulation 31A of the Securities and
Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 and applicable provisions if any of the Companies Act 2013. Post the saidapproval the Company applied to Stock Exchanges for approving the said reclassification.
The National Stock Exchange of India Limited ("NSE") vide its letter datedJanuary 8 2018 and BSE Limited ("BSE") vide its letter dated January 30 2018have accorded their approval for reclassification of the aforementioned Outgoing Promotersfrom "Promoter and Promoter group Category" to "Public Category" underRegulation 31A of SEBI (Listing Obligations & Disclosure Requirements) Regulations2015. Accordingly the below mentioned Outgoing Promoters of the Company (along-with theirrespective family members / relatives the entities controlled by them and persons actingin concert with them who were categorized as Promoters of the Company) have beenre-classified from "Promoter and Promoter Group" category to the"Public" category.
|S. No. ||Name of Outgoing Promoters |
| || |
|1 ||Ashok Mathai Kurien |
|2 ||Ambience Business Services Private Limited |
|3 ||Ashok Kumar Goel |
|4 ||Subhash Chandra |
|5 ||Direct Media Solutions LLP |
|6 ||Manaaska Fashions LLP |
|7 ||Jay Properties Private Limited |
|8 ||Sprit Textiles Private Limited |
|9 ||Essel Media Ventures Limited |
Open Offer by World Crest Advisors LLP & PACs
World Crest Advisors LLP a body corporate along with Veena Investments Private Limitedand Direct Media Distribution Venture Private Limited Persons Acting in Concert("PAC") (all forming part of Promoter and Promoter group of the Company) videLetter of Offer dated June 20 2018 made an Open Offer to all the Public Shareholders ofthe Company to acquire upto 500224893 (Fifty Crore two Lac twenty four thousand eighthundred and ninety three only) equity Shares of the Company representing 26% (Twenty SixPercent) of the Emerging Share Capital of the Company at an offer price of Rs 74/-(Rupees seventy four only) per equity Share. The Public Announcement in relation to theaforesaid offer was made on April 12 2018 and Detailed Public Announcement was publishedon April 18 2018 in Financial Express Jansatta and Mumbai Lakshadeep Newspaper editions.The Draft Letter of Offer ("DLoF") was filed with SEBI on April 25 2018.Recommendations of the Committee of Independent Directors of the Company was dulypublished on June 26 2018 in Financial Express Jansatta and Mumbai Lakshadeep Newspapereditions in terms of applicable provisions.
In terms of Letter of offer the offer was made open from Monday July 2 2018 toFriday July 13 2018. On completion of the Offer Period and in compliance with applicableprovisions World Crest Advisors LLP acquired in aggregate 446238855 (Forty four Croressixty two lakh thirty eight thousand eight hundred and fifty five) equity shares of theCompany.
Accordingly as on date of this report World Crest holds in aggregate 537738955equity shares of face value of Rs 1 each of the Company aggregating to 29.2% of the paidup share capital of the Company.
8. EMPLOYEE STOCK OPTION SCHEME
In compliance with the Securities and Exchange Board of India (Share Based EmployeeBenefits) Regulations 2014 as amended from time to time your Board had authorized theNomination and Remuneration Committee (formerly Remuneration Committee') toadminister and implement the Company's Employees Stock Option Scheme (ESOP 2007)including deciding and reviewing the eligibility criteria for grant and /or issuance ofstock options under the Scheme. The ESOP Allotment Committee of the Board considersreviews and allots equity shares to the eligible Employees exercising the stock optionsunder the Employee Stock Option Scheme (ESOP 2007) of the Company.
During the period under review the Nomination and Remuneration Committee (formerlyRemuneration Committee') of the Board granted 40000 stock options to an eligibleEmployee as per the ESOP 2007 Scheme of the Company. Further the Company duringthe year allotted 45370 fully paid equity shares upon exercise of the stock options byeligible Employees under the ESOP 2007 Scheme of the Company. Applicabledisclosures relating to Employees Stock Options as at March 31 2018 pursuant to SEBI(Share Based Employee Benefits) Regulations 2014 as amended from time to time areavailable on the website of the Company at http://www. dishd2h.com/corporate-governance/The ESOP-2007 Scheme of the Company is in compliance with SEBI (Share Based EmployeeBenefits) Regulations 2014. Statutory Auditors' certificate to the effect that the ESOP 2007 Scheme of the Company has been implemented in accordance with the SEBIGuidelines and as per the resolution passed by the members of the Company as prescribedunder Regulation 13 of the SEBI (Share Based Employee Benefits) Regulations 2014 hasbeen obtained and shall be available for inspection at the Annual General Meeting of theCompany. Copy of the same shall also be available for inspection at the Registered Officeof the Company on all working days (Monday to Friday) between 2.00 P.M. to 4.00 P.M. up tothe date of Annual General Meeting of the Company. Further the Nomination andRemuneration Committee (formerly Remuneration Committee') at its meeting held onAugust 17 2018 with an objective to attract retain motivate incentivize and to attractand retain the best talent has approved a new ESOP Scheme - "ESOP 2018" for theemployees. The Board at its meeting held on the same day approved the said matter and aproposal seeking approval of the members for the said ESOP Scheme forms part of the Noticeof ensuing Annual General Meeting.
9. RIGHT ISSUE OF SHARES & UTILISATION OF PROCEEDS THEREOF
The Company had come up with Right Issue in Financial Year 2008-09 for 518149592equity shares of Rs 1 each issued at Rs 22 per share (including premium of Rs 21 pershare) payable in three installments. Out of the total Right Issue size of Rs 113992.91Lacs the Company has received a sum of Rs 113988.68 Lacs towards the share applicationand call money(s) as at March 31 2018. The details of utilization of Rights Issueproceeds are placed before the Audit Committee and the Board on a quarterly basis.
The Board at its meeting held on May 28 2009 approved to make changes in the manner ofusage of right issue proceeds and the utilization of rights issue proceeds as on March 312018 is as under:
|Particulars ||Amount |
| ||(` In Lakhs) |
|Repayment of loans ||28421.44 |
|Repayment of loans received ||24300.00 |
|after launch of the Rights Issue || |
|General Corporate Purpose ||34722.72 |
|Acquisition of Consumer ||26000.00 |
|Premises Equipment (CPE) || |
|Right Issue Expenses ||544.52 |
|Total ||113988.68 |
10. GLOBAL DEPOSITORY RECEIPT
The Board of your Company at its meeting held on November 11 2016 had approved theScheme of Arrangement amongst Videocon D2H Limited and Dish TV India Limited and theirrespective Shareholders and Creditors (Scheme').
Videocon D2H Limited (the transferor Company in terms of Scheme) had AmericanDepositary Shares ("ADSs") which were listed on Nasdaq Global Market("Nasdaq"). In terms of the scheme the said ADSs were voluntarily delisted fromthe Nasdaq and deregistered with the U.S. Securities and Exchange Commission("SEC"). Accordingly consequent to effectiveness of the scheme the said ADSwere delisted from Nasdaq.
In terms of the Scheme the ADS holders of Videocon D2H Limited had option to elect andto either receive the shares of Dish TV India Limited or the GDR to be issued by Dish TVIndia Limited. Accordingly the ADS holders of Videocon D2H Limited were issued GlobalDepositary Receipts (the "GDRs") of Company. The effective date of issuance ofGDRs was April 12 2018 and the same were listed on the Professional Securities Market("PSM") of the London Stock Exchange on April 13 2018.
Post receipt of all necessary approval(s) and in compliance of order Passed by Hon'bleNational Company Law Tribunal ("NCLT") dated July 27 2017 for Amalgamation ofVideocon D2H Limited into and with the Company the Board at its meeting held on March 262018 approved the issuance of 277095615 Global Depositary Receipts (the"GDRs") to the holders of ADSs of Videocon D2H Limited (each GDR representingone equity share of the Company exchanged at a rate of approximately 8.07331699 new GDRsfor every one Videocon D2H Limited ADS (rounded off up to eight decimal places). Theunderlying equity shares against each of the GDR's were issued in the name of theDepository viz. Deutsche Bank Trust Company Americas.
11. REGISTERED OFFICE
The Registered Office of the Company is presently situated at 18th Floor AWing Marathon Futurex N M Joshi Marg Lower Parel Mumbai-400013 Maharashtra.
12. REGISTRAR & SHARE TRANSFER AGENT
The Registrar & Share Transfer Agent (RTA') of the Company was changed fromSharepro Services (India) Private Limited to Link Intime India Private Limited witheffect from July 1 2016 pursuant to restraining order issued by SEBI against theerstwhile RTA. The Registered office of Link Intime India Private Limited the Registrar& Share Transfer Agent of Company ("RTA") is situated at C 101 247 ParkLBS Marg Vikhroli (West) Mumbai - 400 083 Maharashtra.
13. CORPORATE GOVERNANCE AND POLICIES
In order to maximize shareholder value on a sustained basis your Company has beenconstantly reassessing and benchmarking itself with well-established Corporate Governancepractices besides strictly complying with the requirements of Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015(Listing Regulations') applicable provisions of Companies Act 2013 and applicableSecretarial Standards issued by the Institute of Company Secretaries of India.
In terms of Schedule V of Listing Regulations a detailed report on CorporateGovernance along with Compliance Certificate issued by the Statutory Auditors of theCompany is attached and forms an integral part of this Annual Report. ManagementDiscussion and Analysis Report and Business Responsibility Report as per ListingRegulations are presented in separate sections forming part of the Annual Report. The saidReports will also be available on the Company's website www.dishd2h. com as part of theAnnual Report.
In compliance with the requirements of Companies Act 2013 and Listing Regulationsyour Board has approved various Policies including Code of Conduct for Directors &Senior Management Material Subsidiary Policy Insider Trading Code Document PreservationPolicy Material Event Determination and Disclosure Policy Fair Disclosure PolicyCorporate Social Responsibility Policy Whistle Blower and Vigil Mechanism Policy RelatedParty Transaction Policy Dividend Distribution Policy and Remuneration Policy. Thesepolicies and codes along with the Directors Familiarisation Programme and Terms andConditions for appointment of Independent Directors have been uploaded on Company'swebsite viz. www.dishd2h. com and is accessible at http://www.dishd2h.com/corporate-governance/ In compliance with the requirements of Section 178 of the CompaniesAct 2013 the Nomination and Remuneration Committee of your Board has fixed the criteriafor nominating a person on the Board which inter alia include desired size and compositionof the Board age limits qualification / experience areas of expertise and independenceof individual.
In compliance with the Securities and Exchange Board of India (Prohibition of InsiderTrading) Regulations 2015 (the PIT Regulations') on prevention of insider tradingyour Company had instituted a comprehensive Code of Conduct for regulating monitoring andreporting of trading by Insiders. The said Code lays down guidelines which adviseInsiders on the procedures to be followed and disclosures to be made in dealing with theshares of the Company and cautions them on consequences of non-compliances. Your Companyhas further put in place a Code of practices and procedures of fair disclosures ofunpublished price sensitive information. Both the aforesaid Codes are in line with the PITRegulations.
The Audit Committee of the Board has been vested with powers and functions relating toRisk Management which inter alia includes (a) review of risk management policies andbusiness processes to ensure that the business processes adopted and transactions enteredinto by the Company are designed to identify and mitigate potential risk; (b) laying downprocedures relating to Risk assessment and minimization; and (c) formulationimplementation and monitoring of the risk management plan.
14. DIRECTORS' & KEY MANAGERIAL PERSONNEL Directors
As on March 31 2018 your Board comprised of Five (5) Directors including Three (3)Independent Directors One (1) Executive Director and One (1) Non-Executive Director.Independent Directors provide declarations both at the time of appointment and annuallyconfirming that they meet the criteria of independence as prescribed under Companies Act2013 and Listing Regulations. During FY 17-18 your Board met 6 (six) times details ofwhich are available in the Corporate Governance Report annexed to this report.
During the year under review Mr. Lakshmi Chand an Independent Director on the Boardof the Company tendered his resignation with effect from August 17 2017 on account ofhis other engagements and pre-occupations. Your Board took note of the said resignation atits meeting held on August 17 2017 and placed on record its appreciation for thecontributions made by him during his tenure. Further post March 31 2018 Mr. Arun Duggalan Independent Director on the Board of the Company expressed his inability to continue asDirector due to his other professional obligations and commitments and accordinglytendered his resignation from the Board and Committees thereof with effect from May 182018. Your Board took note of the said resignation at its meeting held on May 29 2018 andplaced on record its appreciation for the contributions made by him during his tenure. TheMembers of the Company at their 27th Annual General Meeting held on September29 2015 approved the appointment of Dr. (Mrs.) Rashmi Aggarwal (DIN - 07181938) as anIndependent Director of the Company for a term of 3 (three) consecutive years from thedate of the 27th Annual General Meeting upto the 30th Annual GeneralMeeting of the Company to be held in the calendar year 2018. Accordingly her term isexpiring at the ensuing Annual General Meeting. Special Resolution seeking members'approval for appointing her as an Independent Directors for the second term of 5 yearsfrom expiry of her current term forms part of the notice of the ensuing Annual GeneralMeeting. Your Company has received a notice in writing along with requisite depositpursuant to Section 160 of Companies Act 2013 proposing re-appointment of Dr. (Mrs.)Rashmi Aggarwal for second term and based on performance evaluation and contributions madeby her your Board recommends her appointment for the second term of 5 years from the dateof the 30th Annual General Meeting upto the 35th Annual GeneralMeeting of the Company to be held in the calendar year 2023. The Members of the Company attheir 27th Annual General Meeting held on September 29 2015 approved there-appointment and terms thereof of Mr. Jawahar Lal Goel (DIN no. 00076462) as theManaging Director of the Company for a period of three years effective from January 62016 to January 5 2019. Accordingly the said present appointment of Mr. Goel wouldexpire on January 5 2019. Your Board as per the recommendation of the Nomination andRemuneration Committee and subject to approval of shareholders at the ensuing AnnualGeneral Meeting and subject to such other approvals as may be required considered andapproved the re-appointment of Mr. Goel as the Managing Director of the Company for afurther period from January 6 2019 to December 16 2019 (both days included) at itsmeeting held on August 17 2018. Requisite proposal seeking your approval for hisre-appointment as Managing Director and also payment of remuneration forms part of theNotice of ensuing Annual General Meeting. Your Board recommend the proposal for approvalof Shareholders.
Mr. Ashok Kurien Non-Executive Director is liable to retire by rotation at the ensuingAnnual General Meeting and being eligible has offered himself for re-appointment. YourBoard recommends his reappointment.
During the year under review Mr. Arun Kumar Kapoor Chief Executive Officer tenderedhis resignation from the close of working hours of May 15 2017._ Your Board placed onrecord its appreciation for the contributions made by him during his tenure. Based on therecommendation of Nomination and Remuneration Committee your
Board appointed Mr. Anil Kumar Dua as the Group Chief Executive Officer of the Companywith effect from May 17 2017. In compliance with the requirements of Section 203 of theCompanies Act 2013 as on the date of this report Mr. Jawahar Lal Goel ManagingDirector and Chairman Mr. Anil Kumar Dua Chief Executive Officer Mr. Rajeev KumarDalmia Chief Financial Officer and Mr. Ranjit Singh Company Secretary of the Company areKey Managerial Personnel of the Company.
Chairman & Managing Director
Mr. Jawahar Lal Goel continues to be the Chairman and Managing Director of theCompany. Under the leadership of Mr. Goel the Company has continuously maintained growthin terms of revenue as well as continued its stronghold on the Direct to Home (DTH) marketshare. The Company has made considerable progress in all the spheres and has achievedtremendous growth and acquired goodwill and reputation in the business. Mr. Goel hasspearheaded the organization with strong zeal and commitment despite strong competitiveintensity rise of digital cable network regulatory challenges and technologicalupheavals.
Mr. Goel has led your Company in a highly competitive and volatile market to not justconsolidate its market leadership but also in shaping the future of your Company into amodern technology & innovation-driven organisation.
As on March 31 2018 your Board comprises of 5 Directors including 3 IndependentDirectors (including 1 Women Director). The Company recognizes and embraces the importanceof a diverse Board in its success. The Board has also adopted the Board Diversity Policy.
The Board met Six times during the Financial Year the details of which are given inthe Corporate Governance Report which forms part of this Annual Report. The interveninggap between any two meetings was within the period prescribed by the Companies Act 2013and Listing Regulations.
Declaration by Independent Directors
Independent Directors of the Company provide declarations both at the time ofappointment and annually confirming that they meet the criteria of independence asprescribed under Companies Act 2013 and the Listing Regulations. Your Company hasreceived the said declarations from all the Independent Directors. In the opinion of theBoard Independent Directors fulfil the conditions specified in the Act Rules madethereunder and Listing Regulations and are independent of the management.
A formal evaluation of the performance of the Board it's Committees the Chairman andthe individual Directors was carried out for the Financial Year 2017-18 on March 26 2018.The Independent Directors of your Company in a separate meeting held without presence ofother Directors and management evaluated the performance of the Chairman & ManagingDirector and other Non-Independent Directors along with performance of the Board / BoardCommittees based on various criteria recommended by Nomination and Remuneration Committeeand Guidance Note on Board Evaluation' dated January 5 2017 issued by SEBI. Areport on such evaluation done by the Independent Directors was taken on record by theBoard and further your Board in compliance with requirements of Companies Act 2013evaluated performance of all Independent Directors based on various parameters includingattendance contribution etc. The details of the evaluation process are set out in theCorporate Governance Report which forms part of this Report.
Policy on Directors' appointment and remuneration
In compliance with the requirements of Section 178 of the Companies Act 2013 theNomination & Remuneration Committee' (NRC Committee) of your Board had fixed thecriteria for nominating a person on the Board which inter alia include desired size andcomposition of the Board age limit qualification / experience areas of expertise andindependence of individual. Your Company has also adopted a Remuneration Policy salientfeatures whereof is annexed to this report.
Further pursuant to provisions of the Act the NRC Committee of your Board hasformulated the Remuneration Policy for the appointment and determination of remunerationof the Directors Key Management Personnel Senior Management and other Employees of yourCompany. The NRC Committee has also developed the criteria for determining thequalifications positive attributes and independence of Directors and for making paymentsto Executive Directors of the Company. The NRC Committee takes into consideration the bestremuneration practices in the industry while fixing appropriate remuneration packages andfor administering the long-term incentive plans such as ESOPs. Further the compensationpackage of the Director Key Management Personnel Senior Management and other employeesare designed based on the set of principles enumerated in the said policy. Your Directorsaffirm that the remuneration paid to the Directors Key Management Personnel SeniorManagement and other employees is as per the Remuneration Policy of your Company.
The Remuneration details of the Executive Director Chief Executive Officer ChiefFinancial Officer and Company Secretary along with details of ratio of remuneration ofDirector to the median remuneration of employees of the Company for the FY under revieware provided as Annexure to this Report.
Familiarisation Programme for Independent Directors
During the year under review to familiarize the Directors with strategy operationsand functions of the Company the senior managerial personnel made presentations aboutCompany's strategy operations product offering market technology facilities and riskmanagement. The Directors were also provided with relevant documents reports and internalpolicies to enable them to familiarise with your Company's procedures and practices fromtime to time besides regular briefing by the members of the senior leadership team.
Also the Board including all Independent Directors were given a detailed presentationon February 6 2018 by Ernst & Young LLP on various aspects of the Companies AmendmentAct 2017 Roles and responsibilities of Directors and applicable provisions of IND ASAccounting Standards.
Further at the time of appointment of an Independent Director the Company issues aformal letter of appointment outlining their duties and responsibilities as a Director.Detail of familiarisation program organized for Independent Directors during FY underreview form part of Corporate Governance Report annexed hereto and are also posted on theCompany's website viz. http://www.dishd2h.com/ and can be viewed on the following link:http://www.dishd2h. com/corporate-governance/
Committees of the Board
In compliance with the requirements of Companies Act 2013 and Listing Regulations yourBoard had constituted various Board Committees including Audit Committee Nomination &Remuneration Committee Stakeholders Relationship Committee and Corporate SocialResponsibility Committee. During the period under review in view of resignation of Mr.Lakshmi Chand Independent Director from the Board and committees thereof with effectfrom August 17 2018 the Audit and Nomination & Remuneration Committee wasre-constituted. As on March 31 2018 the Audit Committee of the Board consisted of Mr. BD Narang an Independent Director as the Chairman of the Committee and Mr. Arun Duggal andDr. (Mrs.) Rashmi Aggarwal Independent Directors as its members.
Further in view of resignation of Mr. Arun Duggal Independent Director from theBoard and committees thereof with effect from May 18 2018 the Board at its meeting heldon May 29 2018 reconstituted the Composition of Board Committees. As on the date of thisreport the Audit Committee of the Board consists of Mr. B D Narang an IndependentDirector as the Chairman of the Committee and Mr. Ashok Mathai Kurien Non-Executive - NonIndependent Director and Dr. (Mrs.) Rashmi Aggarwal Independent Director as its members.
Details of the constitution of the Board Committees which are in accordance withregulatory requirements have been uploaded on the website of the Company viz.http://www.dishd2h.com Details of scope constitution terms of reference number ofmeetings held during the year under review along with attendance of Committee Memberstherein form part of the Corporate Governance Report annexed to this report.
Your Company is committed to highest standards of ethical moral and legal businessconduct. Accordingly the Board of Directors have formulated Vigil Mechanism/WhistleBlower Policy which provides a robust framework for dealing with genuine concerns &grievances. The Policy provides opportunity to Directors/ Employees/Stakeholders of theCompany to report concerns about unethical behavior actual or suspected fraud of anyDirector and/or Employee of the Company or any violation of the Code of Conduct. ThePolicy safeguards whistleblowers from reprisals or victimization. Further during the yearunder review no case was reported under the Vigil Mechanism. In terms of the said policyno personnel has been denied access to the Audit Committee of the Board.
Your Company is required to maintain the Cost Records as specified by the CentralGovernment under sub-section (1) of Section 148 of the Companies Act 2013 read withNotification No. GSR. 695(E) dated July 14 2016 of Ministry of Corporate Affairs.
Your board at its meeting held on May 24 2017 had appointed M/s Chandra Wadhwa &Co. (Firm Registration No. 00239) Cost Accountants to carry out Audit of Cost Recordsof the Company for the Financial Year 2017-18. The Cost Auditors have issued their reportfor the Financial Year 2017-18 on July 9 2018 which has been taken on record by theAudit / Board of the Company.
15. CORPORATE SOCIAL RESPONSIBILITY
In compliance with requirements of Section 135 of the Companies Act 2013 your Companyhas a duly constituted Corporate Social Responsibility Committee (CSR Committee)comprising of five members including three Independent Directors as on March 31 2018. Mr.Arun Duggal Independent Director and Member of the committee resigned from the Board andcommittees thereof with effect from May 18 2018 due to professional obligations andcommitments. Post resignation of Mr. Duggal the Committee comprises of four membersincluding Two Independent Directors. Accordingly as on date the CSR Committee comprisesof four members including two Independent Directors. Your Company has adopted a unifiedapproach towards CSR wherein CSR contributions are pooled in to fund high cost long-termprojects that help build Human capital and create lasting impact on the society. TheCommittee has approved the CSR Policy with Education Health Care Women Empowerment andSports as primary focus area. A Section 8 Company in the name of Subhash ChandraFoundation' was established and the Company had contributed to the said foundation towardspreventive Health care Initiative including sponsorship of Madhav Netralaya' adedicated Centre of excellence for ophthalmology.
A detailed report on Corporate Social Responsibility activities initiated by theCompany during the year under review in compliance with the requirements of CompaniesAct 2013 is annexed to this report.
16. POSTAL BALLOT
During the year under review your Company sought the approval of the Shareholdersthrough Postal Ballot on the below matters:
Postal Ballot Notice dated April 3 2017 seeking Shareholders consent through SpecialResolution for approval of the Scheme of Arrangement among Videocon D2H Limited and DishTV India Limited and their respective shareholders and creditors pursuant to Sections 230to 232 of the Companies Act 2013 and the Hon'ble National Company Law Tribunal MumbaiBench Order dated March 22 2017. The said Postal Ballot was conducted in terms of Orderof Hon'ble National Company Law Tribunal in addition to calling the NCLT convened meetingof Shareholders. The said notice along with Postal Ballot Form and Business ReplyEnvelopes were duly sent to the Shareholders and your Company also offered E-Votingfacility as an alternate option for voting by the Shareholders which enabled them to casttheir votes electronically instead of Physical Postal Ballot Form. The said resolutionwas passed with requisite majority and the result of the same was declared on May 122017.
Postal Ballot Notice dated August 17 2017 seeking Shareholders consent throughSpecial Resolution for Sale / Transfer of the Company's Non-Core Business undertaking ofInfra Support Services (including set top boxes dish antenna etc. and related services)to Dish Infra Services Private Limited a wholly owned Subsidiary of the Company on agoing concern basis.
The said notice along with Postal Ballot Form and Business Reply Envelopes were dulysent to the Shareholders and your Company also offered E-Voting facility as an alternateoption for voting by the Shareholders which enabled them to cast their voteselectronically instead of Physical Postal Ballot Form. The said resolution was passedwith requisite majority and the result of the same was declared on September 27 2017.
Postal Ballot Notice dated October 11 2017 seeking Shareholders consent throughOrdinary Resolution for Re-classification from Promoter Group' Category toPublic' Category The said notice along with Postal Ballot Form and Business ReplyEnvelopes were duly sent to the Shareholders and your Company also offered E-Votingfacility as an alternate option for voting by the Shareholders which enabled them to casttheir votes electronically instead of Physical Postal Ballot Form. The said resolutionwas passed with requisite majority and the result of the same was declared on November 252017.
The procedure prescribed under Section 110 of the Companies Act 2013 read with theCompanies (Management and Administration) Rules 2014 was adopted for conducting thePostal Ballots. Further details related to the Postal Ballot procedure adopted votingpattern and result thereof have been provided under the General Meeting Section ofReport on Corporate Governance'.
17. AUDITORS Statutory Auditors
At the 26th Annual General Meeting of the Company held on September 292014 M/s. Walker Chandiok & Co. LLP Chartered Accountants Gurgaon havingRegistration No 001076N/N - 500013 were appointed as the Statutory Auditors of the Companyto hold office till the conclusion of the 29th Annual General Meeting. Furtherat 29th Annual General Meeting held on September 28 2017 the members hadre-appointed M/s. Walker Chandiok & Co. LLP Chartered Accountants New Delhi as theStatutory Auditors' of the Company for second term of Five (5) consecutive years i.e. tohold office from the date of 29th Annual General Meeting until the conclusionof the 34th Annual General Meeting of the Company to be held in the calendaryear 2022 subject to ratification by the Shareholders every year. Pursuant to the recentNotification issued by the Ministry of Corporate Affairs on May 7 2018 amending Section139 of the Companies Act 2013 and the Rules framed thereunder the mandatory requirementfor ratification of appointment of Auditors by the Members at every Annual General Meeting("AGM") has been omitted. 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 Walker Chandiok & Co LLP in accordance with the provisions of the CompaniesAct 2013 read with rules thereunder and a confirmation that they continue to hold validPeer Review Certificate as required under Listing Regulations.
During the year the Board re-appointed Mr. Jayant Gupta Practicing Company Secretaryproprietor of M/s Jayant Gupta & Associates Company Secretaries as the SecretarialAuditor of the Company for conducting the Secretarial Audit for the financial year2017-18. In terms of Section 204 of the Companies Act 2013 and the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 the Secretarial Audit for FY 17-18was carried out by Mr. Jayant Gupta Practicing Company Secretary (holding ICSICertificate of Practice No. 9738).
The Company has complied with all the provisions of Secretarial Standards issued by theInstitute of Company Secretaries of India and approved by the Central Government.
The reports of Statutory Auditor and Secretarial Auditor forming part of this Annualreport do not contain any qualification reservation or adverse remarks. During the yearthe Statutory Auditors have not reported any matter under Section 143 (12) of the Acttherefore no detail is required to be disclosed under the applicable provisions of theAct.
In compliance with the requirements of Section 148 of the Companies Act 2013 read withCompanies (Cost Records and Audit) Rules 2014 as amended from time to time M/s ChandraWadhwa & Co. (Firm Registration No. 00239) Cost Accountants were appointed to carryout Audit of Cost Records of the Company for the Financial Year 2017-18. The Board of yourCompany on the basis of the recommendation of the Audit Committee had approved there-appointment of M/s Chandra Wadhwa & Co. (Firm Registration No. 00239) CostAccountants as the Cost Auditors for the financial year ending March 31 2019.
Requisite proposal seeking ratification of remuneration payable to the Cost Auditor forthe Financial Year 2018-19 by the Members as per Rule 14 of Companies (Audit and Auditors)Rules 2014 forms part of the Notice of ensuing Annual General Meeting.
Protiviti Advisory India Member LLP was the Internal auditor of the Company for theFinancial Year 2017-18.The Audit Committee at its meeting held on May 29 2018 decided andrecommended to the Board for re-appointment of Protiviti Advisory India Member LLP as theInternal Auditor of the Company for the Financial Year 201819. Basis therecommendation of the Audit Committee the Board at its meeting held on May 29 2018 hasre-appointed Protiviti Advisory India Member LLP as the Internal Auditor of the Companyfor the Financial Year 2018-19.
Reporting of frauds by Auditors
During the year under review the Auditors have not reported any instances of fraudscommitted in the Company by its Officers or Employees to the Audit Committee under Section143(12) of the
Companies Act 2013 details of which needs to be mentioned in this report.
i. Particulars of Loans guarantees and investments: Particulars of Loansguarantees and investments made by the Company required under Section 186(4) of theCompanies Act 2013 and the Listing Regulations are contained in Note no. 66 to theStandalone Financial Statement.
ii. Transactions with Related Parties: In terms of the applicable statutoryprovisions the related party transactions are placed before the Audit Committee for itsapproval and statement of all related party transactions is placed before the AuditCommittee for its review on a quarterly and yearly basis specifying the nature value andterms and conditions of the transactions along with Arms-length justification. All RelatedParty Transactions entered during the year were in Ordinary Course of the Business and onArm's Length basis. During the year under review there have been no materiallysignificant related party transactions as defined under Section 188 of the Act andRegulations 23 the Listing Regulations and accordingly no transactions are required to bereported in Form AOC-2 as per Section 188 of the Companies Act 2013.
iii. Risk Management: Your Company follows a comprehensive system of RiskManagement. It has adopted a policy and procedure for rapid identification definition ofrisk mitigation plans and execution. Actions include adjustments in prices dispatch planinventory build-up and active participation in regulatory mechanisms. Many of these riskscan be foreseen through systematic tracking. Your Company has also defined operationalprocesses to ensure that risks are identified and the operating management are responsiblefor identifying and implementing mitigation plans for operational and process risk. Keystrategic and business risks are identified and managed by senior management team. TheRisks and their mitigation plans are updated and reviewed periodically by the AuditCommittee and integrated in the Business plan for each year. In the opinion of the Boardthere are no risks that may threaten the existence of the Company.
iv. Internal Financial Controls and their adequacy: Your company has aneffective internal control and risk mitigation system which is constantly assessed andstrengthened with standard operating procedures and which ensures that all the assets ofthe Company are safeguarded & protected against any loss prevention and detection offrauds and errors ensuring accuracy and completeness of the accounting records timelypreparation of reliable financial information and that all transactions are properlyauthorized and recorded. The Company has laid down procedures to inform audit committeeand board about the risk assessment and mitigation procedures to ensure that themanagement controls risk through means of a properly defined framework. The AuditCommittee evaluates the internal financial control system periodically and deals withaccounting matters financial reporting and periodically reviews the Risk ManagementProcess. Based on internal financial control framework and compliance systems establishedin the Company the work performed by statutory internal and secretarial auditors andreviews performed by the management and/or relevant Audit and other Committees of theBoard your Board is of the opinion that the Company's internal financial controls wereadequate and effective during the financial year 2017-18. During the year no reportablematerial weakness in the design or operation was observed.
v. Deposits: Your Company has not accepted any public deposit under Chapter V ofthe Companies Act 2013.
vi. Transfer to Investor Education and Protection Fund: During the year underreview in compliance with the requirements of The Investor Education and Protection FundAuthority (Accounting Audit Transfer and Refund) Rules 2016 (IEPF Rules) as amendedyour Company had transferred an amount of Rs 573250 (Rupees Five Lakh Seventy ThreeThousand Two Hundred and Fifty Only) to Investor Education and Protection Fund on accountof unpaid sale proceeds of Fraction shares under the Scheme of Arrangement pending for 7or more years. The said amount can be claimed by the Shareholders from IEPF authorityafter following process prescribed in IEPF Rules.
vii. Transfer to General Reserve: During the Financial Year under review noamount has been transferred to the General Reserve of the Company
viii. Extract of Annual Return: The extract of Annual return in form MGT-9 asrequired under Section 92(3) of the Act read with Companies (Management &Administration) Rules 2014 is annexed to this report.
ix. Sexual Harassment: The Company has zero tolerance for Sexual Harassment atworkplace. The Company has complied with the provisions relating to the constitution ofInternal Complaints Committee under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013. The Company has constituted InternalComplaint(s) Committee functioning at various locations to redress complaints regardingsexual harassment and has adopted a Policy on prevention of Sexual Harassment in line withthe provisions of The Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013'. There was no complaint of sexual harassment duringthe year under review.
x. Regulatory Orders: No significant or material orders were passed by theregulators or courts or tribunals which impact the going concern status and Company'soperations in future.
19. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNING AND OUTGO
Your Company is in the business of providing Direct-to- Home (DTH') services.Since the said activity does not involve any manufacturing activity most of theInformation required to be provided under Section 134(3)(m) of the Companies Act 2013read with the Companies (Accounts) Rules 2014 are not applicable. However theinformation as applicable are given hereunder:
Conservation of Energy:
Your Company being a service provider requires minimal energy consumption and everyendeavor is made to ensure optimal use of energy avoid wastages and conserve energy asfar as possible.
In its endeavor to deliver the best to its viewers and business partners your Companyis constantly active in harnessing and tapping the latest and best technology in theindustry.
Foreign Exchange Earnings and Outgo:
During the year under review your Company had foreign exchange earnings of Rs 1008Lakhs and outgo of Rs 18039 Lakhs.
ICRA Limited a Credit rating agency has during the year under review assigned ICRAA+_ (ICRA A plus) rating for the Loan Term Loans and ICRA A+ (Stable)/ ICRA A1 long-term/short-term interchangeable* (*Sub-Limit of long-term loan and fully interchangeablebetween fund based and non-fund based). Instruments with this rating are considered tohave very strong degree of safety regarding timely payment of financial obligations. Suchinstruments carry lower credit risk.
CARE (Credit Analysis and Research Limited) a Credit rating agency has enhanced therating of Long-Term/Non-Convertible Debenture/ Short Term Bank Facilities of the Companyto CARE A+(SO) /A1+ (SO). Instruments with this rating are considered to have very strongdegree of safety regarding timely payment of financial obligations. Such instruments carrylower credit risk.
21. HUMAN RESOURCE MANAGEMENT
Your Company has been successful in attracting best of the talent from industry andacademic institutions and has been effectively retaining them. Your Company has created afavorable work environment which encourages innovation meritocracy and teamcollaboration. The Company is committed to nurturing enhancing and retaining talentthrough superior Learning & Organization Development interventions. Owing to theamalgamation of Videocon D2H Limited into the Company Human Resource Management has beenone of the key priorities for your Company. While harmonizing people practices thestrategic approach had been to adopt best aspects of both companies align to themarket-best practices and build a future ready organization. In an endeavor to build anorganization that is swifter and more efficient your Company has undergone a completerestructuring exercise. The new structure has been designed keeping in mind the businesspriorities and long term strategic goals of your Company. Whilst aligning the newstructure it was essential for your Company to create equivalence across both legacygrade structures considering a number of factors such as existing organizationhierarchies responsibility levels impact on business degree of complexity knowledgeand skill requirements span of control etc. Considering these factors a flatterorganization was created to enable empowerment across levels effective communicationcollaboration and faster decision making. Role-fitment was done basis a structured processof competency assessment conducted by a third party. To bring synergies in policies andpeople processes your company adopted the best practices of both the organizations aswell as the industry and overhauled the existing policies. Both entities shared a numberof similarities yet had their individual strengths. To ensure effective Amalgamation ofthe workforce Values were redefined to serve as "cultural glue" to offer mutualunderstanding effective communication and significantly increase the efficiency of theorganisation. Workshops were and are being conducted for employees across the country sothey understand and exhibit these values in their work and behaviour. In order to build avalue-driven organization these values are included in the Performance Management System.The focus stems from the fact that a value based culture not only enhances customersatisfaction and loyalty but also improves the organizational performance and engagementlevels. Going forward alongside the KRA's these values will be the cultural cornerstonesguiding the organisation's actions be it decision making people processes or theoperations of your Company. These will also be integrated in the hiring philosophy andreward & recognition programs.
Your Company believes that committed employees are vital for the sustained growth ofthe Company. The Company takes pride in the commitment competence and dedication shown byits employees in all areas of business. Your Company has established policies andprocedures to discover and use the employees' capabilities and potential to increase theircommitment and contribution to the overall organization. The Company has a robustappraisal system and appraisals are done following a top down approach and openperformance discussions. We encourage meritocracy and reward excellence in performance.Your Directors place on record their appreciation for the significant contribution made byall employees who through their competence dedication hard work co-operation andsupport have enabled the Company to cross milestones on a continual basis.
Particulars of Employees
As on March 31 2018 the total numbers of permanent employees on the records of theCompany were 596. The information required under Section 197 of the Companies Act 2013(Act') read with the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 along with statement showing names and other particulars of theemployees drawing remuneration in excess of the limits prescribed under the said rules isannexed to this report.
22. DIRECTORS' RESPONSIBILITY STATEMENT
In terms of and pursuant to Section 134 of the Companies Act 2013 in relation to theAnnual Financial Statements for the Financial Year 2017-18 your Directors state andconfirm that:
a) The Financial Statements of the Company comprising of the Balance Sheet as at March31 2018 and the Statement of Profit & Loss for the year ended on that date have beenprepared on a going concern basis;
b) In the preparation of these Financial Statements the applicable accountingstandards had been 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 2018 and of the profit 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.
23. BUSINESS RESPONSIBILITY REPORT & MANAGEMENT DISCUSSION AND ANALYSIS
The Business Responsibility Report (BRR') has been prepared and forms part of theAnnual Report as Annexure. The Report provides an overview of initiatives taken by yourCompany.
The Management Discussion and Analysis report as provided under Listing Regulations isseparately attached hereto and forms an integral part of this Annual Report. The saidreport gives details of the overall industry structure economic developments performanceand state of affairs of your Company's business and other material developments during thefinancial year under review.
24. INDUSTRIAL OPERATIONS
The Company maintained healthy cordial and harmonious industrial relations at alllevels. The enthusiasm and unstinting efforts of the employees have enabled the Company toremain at the leadership position in the industry. It has taken various steps to improveproductivity across the organization.
25. CAUTIONARY STATEMENT
Statements in this Report particularly those which relate to Management Discussion andAnalysis describing the Company's objectives projections estimates and expectationsmay constitute forward looking statements' within the meaning of applicable laws andregulations and actual results might differ.
It is our strong belief that caring for our business constituents has ensured oursuccess in the past and will do so in future. Your Directors value the professionalism andcommitment of all employees of the Company and place on record their appreciation of thecontribution made by employees of the Company and its subsidiaries at all levels that hascontributed to your Company's success. Your Directors acknowledge with sincere gratitudethe co-operation and support extended by the Central and State Governments the Ministryof Information and Broadcasting (MIB') the Department of Telecommunication(DOT') Ministry of Finance the Telecom Regulatory Authority of India(TRAI') the Stock Exchanges and other stakeholders including employeessubscribers vendors bankers investors service providers as well as other regulatoryand government authorities. Your Board also takes this opportunity to express its deepgratitude for the continued co-operation and support received from its valuedstakeholders. For and on behalf of the Board
|Jawahar Lal Goel ||B. D. Narang |
|Chairman & Managing Director ||Independent Director |
|DIN: 00076462 ||DIN: 00826573 |
|Place: Noida || |
|Date: August 17 2018 || |