To the Members
Your Directors are pleased to present the 31st (Thirtyfirst) Board Report of your Company providing an overview of the business and operationsof the Company together with Annual Audited Financial Statements for the Financial Year(FY') ended March 31 2019 prepared as per Indian Accounting Standardsprescribed under Section 133 of the Companies Act 2013 (Act').
1. FINANCIAL RESULTS
The financial performance of your Company for the FY ended March 312019 is summarized below:
(Rs In Lacs)
| ||Standalone Year Ended ||Consolidated Year Ended |
|Particulars ||Year ended ||Year ended ||Year ended ||Year ended |
| ||March 31 2019 ||March 31 2018 ||March 31 2019 ||March 31 2018 |
|Sales & Services ||393788 ||286260 ||616613 ||463416 |
|Other Income ||11219 ||6132 ||5215 ||5416 |
|Total Income ||405007 ||292392 ||621828 ||468832 |
|Total Expenses ||403104 ||306585 ||619143 ||478623 |
|Profit/(Loss) before Tax & Prior Period Item ||1903 ||(14193) ||2685 ||(9791) |
|Prior Period Item ||170453 ||- ||156254 ||- |
|Profit/(Loss) before Tax ||(168550) ||(14193) ||(153569) ||(9791) |
|Profit from continuing operations before tax ||(168550) ||(14193) ||(153569) ||(9791) |
|Profit/(loss) from discontinuing operations before tax ||- ||18986 ||- ||- |
|- Current tax Continuing operation ||1519 ||- ||2844 ||527 |
|- Income tax -prior years ||540 ||(196) ||921 ||(302) |
|- Deferred tax-Continued operation ||(41667) ||(8785) ||(40993) ||(1526) |
|- Deferred tax-Discontinued operation ||- ||10440 ||- ||- |
|Profit from continuing operations after tax ||(128942) ||(5212) ||(116341) ||(8490) |
|Profit/(loss) from discontinuing operations after tax ||- ||8546 ||- ||- |
|Profit/(Loss) after Tax ||(128942) ||3334 ||(116341) ||(8490) |
|Profit/(Loss) for the Year ||(128942) ||3334 ||(116341) ||(8490) |
|Add: Balance brought forward ||18427 ||(139328) ||20233 ||(126776) |
|Adjustment for Non-controlling interest ||- ||- ||1851 ||986 |
|Adjustment for depreciation ||- ||- ||- ||- |
|Transferred from securities premium (capital reduction) ||- ||154340 ||- ||154340 |
|Add: Re-measurement of post-employment benefits ||195 ||81 ||531 ||173 |
|Less: Dividend paid during the year ||(9206) ||- ||(9206) ||- |
|Less: Dividend distribution tax on dividend ||(1892) ||- ||(1892) ||- |
|Amount available for appropriations ||(121418) ||18427 ||(106767) ||20233 |
|Balance Carried Forward ||(121418) ||18427 ||(106767) ||20233 |
There have been no material changes and commitments that have occurredafter close of the FY till the date of this report which affect the financial position ofthe Company. Based on the internal financial control framework and compliance systemestablished in the Company and verified by the statutory and internal auditors and reviewsperformed by the management and / or the Audit Committee of the Board your Board is ofthe opinion that Company's internal financial controls were adequate and effectiveduring the FY_2018-19.
In terms of Regulation 43A of the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 (ListingRegulations') as applicable to the top 500 Listed Companies the Board of yourCompany has Dividend Distribution Policy. The said Policy of the Company sets out theparameters and circumstances that will be taken into account by the Board in determiningwhether or not to distribute dividend to its shareholders the quantum of profits and/orretained profits earned by the Company to be distributed as dividend. The policy isavailable on the website of the Company viz. http://www.dishd2h.com/corporate-governance/.
Pursuant to the approval of the Board of Directors at its meeting heldon October 25 2018 your Company paid an interim dividend of Re. 0.50/- (Paisa FiftyOnly) per equity share of face value of Re. 1/- (Rupees One Only) each on fully paid upequity shares and proportionate amount on partly paid up equity shares to the extent paidup to the shareholders whose name appeared in the Register of Members as on TuesdayNovember 6 2018 being the record date fixed for this purpose. The Board has notrecommended any final dividend and the interim dividend of Re. 0.50/- (Paisa Fifty Only)per equity share declared by the Board in its meeting held on October 25 2018 shall beconsidered as the final dividend for the FY 2018-19. Thus the total dividend for the FY2018-19 remains at Re. 0.50/- (Paisa Fifty Only) per equity share with a total cashoutflow of Rs 11098 Lakhs including tax on dividend.
Your Company is in due compliance with the Dividend Distribution policyas approved by the Board.
3. BUSINESS OVERVIEW
Consumption of Entertainment Infotainment news and other genre ofchannels has become a basic need for people. Cutting across the spectrum of agegeography sex social and income levels it's consumption is leapfrogging both interms of frequency and volume. It is a marvelous cycle where demand is getting fueled by ahuge spurt in content creation and both consumption as well as creation getting enabled byubiquitous technology. Today anyone can create and anyone can consume. As per PwC GlobalEntertainment & Media Outlook 2019 India would remain the fastest growing territorysurging at a CAGR of 11.28% to reach US$64 Billion by 2023 and TV subscription (81% shareof M&E sector) will remain by far the biggest market. We think this propensity toconsume will positively impact the propensity to pay and that augurs extremely well forthe entire industry. The willingness to pay would go hand in hand with the ability to pay.Indian economy growth is expected to continue outpacing the global economy by a widemargin. The World Bank has retained its forecast of India's growth rate at 7.5% forthe current financial year Vs a global growth rate estimate of 2.6% for 2019-20. Thisgrowth would translate into more money in the hand of subscribers.
This pattern of increasing spend on entertainment can be seen todayacross segments such as box office collections theatre sports OTT and of course DTH.Subscribers today are consuming more and more entertainment from multiple sources. Tocapitalize upon this opportunity your company has launched the innovative "Dish SmrtStick". It is a wi-fi dongle which enables existing "Dish Nxt HD+" set topboxes to connect with the internet and stream online content onto the subscribers TV set.These launches are a part of our strategic plans to attract digital and tactical digitalconsumers. Your Company plans to launch more such innovative devices in FY 2019-20. To cuein innovation and technology not only did we plan a slew of products but alsore-launched our brand in the market using none other than the popular youth icon RanveerSingh. Ranveer who is known for his energy versatility vivaciousness and mass appealcomplemented our objective of being recognized as a contemporary brand. We are confidentthat this relationship will go a long way in bringing alive our dishkiyaon'avatar and strengthening the bond with the consumer.
Another innovative launch with the vision of strengthening our overallpresence in the market was Watcho' our offering in the OTT segment. The appcomes with a rich library of Live TV Original shows short-films and much more. This isan industry-first product that gives your Company a competitive advantage. This platformgoes beyond providing differentiated content by doubling up as a platform to share contentand potentially earn revenue out of that. In the three decades since private broadcast anddistribution took off the year 2018-2019 was a landmark as it saw the most comprehensiveoverhaul of rules and regulations for the industry. It has brought about a level playingfield which will bode well for all the players. Players with low service standards wouldneed to upgrade input pricing would become equal for all players and the consumer hasindeed become the king will be able to choose and pay only for the channel which isrequired. The DTH industry always suffered from an input price imbalance when compared tothe cable industry. This anomaly has now been corrected and finally subscribers willchoose on the basis of content and the quality of service.
A by-product of the New Tariff Order has been content reduction on theFree to Air platform. Our brands are exceptionally strong in the rural Hindi speakingmarkets and we hope to garner a majority of subscribers when they start looking foroptions. During the year under review your company made profit before tax and exceptionalitems to the tune of Rs 1903 lacs verses previous year loss of `14193 lacs. On top ofit the total revenue of your company grew to `405407 lacs verses previous year revenueof `292392 lacs. This was achieved with sustained focus on the customer satisfactiongood offering of bundled channels and value added services to the subscribers. Customerservice and satisfaction continued to be the focal point of your company. The digitalrecharge collections of your Company has crossed 45% of the total recharge collectionsduring the period under review. The Ministry of Information and Broadcasting Governmentof India (MIB) vide its letter dated June 25 2019 has granted an interim extensionto the DTH License of the Company upto December
31 2019 or till the date of notification of New DTHguidelines' whichever is earlier.
It is our constant endeavor to provide value to our subscribers andmaximize value for shareholders. This is the yin and yang mantra powering the operationsof your company.
4. SCHEME OF ARRANGEMENT AMONG VIDEOCON D2H LIMITED("TRANSFEROR COMPANY") AND DISH TV INDIA LIMITED ("TRANSFEREECOMPANY") AND THEIR RESPECTIVE SHAREHOLDERS AND CREDITORS
The previous financial year was a landmark year for Dish TV with thecompletion of Amalgamation of Videocon D2H Limited with and into Company which becameeffective on March 22 2018 with October 1 2017 being the appointed date.
The Board of your Company and the Board of Videocon D2H Limited attheir respective meetings held on November 11 2016 approved the Scheme of Arrangementamongst Videocon D2H Limited and Dish TV India Limited and their respective shareholdersand creditors (Scheme') for amalgamation of Videocon D2H Limited into and withDish TV India Limited. The National Stock Exchange of India Limited and BSE Limitedprovided No Objection' to the said Scheme on March 1 2017 and March 2 2017respectively.
The said Amalgamation was also approved by the Competition Commissionof India (CCI) vide its approval 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 a hearing heldon July 27 2017 approved the said Scheme and 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 2017approved the aforesaid Amalgamation. Taking further steps for effecting the said Schemethe Companies (Videocon D2H Limited and Dish TV India Limited) on March 22 2018 filedthe Copy of the order dated July 27 2017 passed by the Hon'ble National Company LawTribunal (NCLT) along with the Approved Scheme with the Registrar of Companies MumbaiMaharashtra.
Accordingly upon completion of all the steps pursuant to theaforementioned Scheme read with the NCLT Order Videocon D2H Limited has merged into andwith Dish TV India Limited on March 22 2018 which was the Effective date of the Scheme.
Three well recognized and powerful brands dishtv'd2h' and Zing' are being marketed under the Dish TVIndia Limited umbrella with each being favourably positioned in its key target markets.While dishtv has always had a high top-of-the-mind consumer brand recall d2hhas had the advantage of having high brand loyalty in trade circles. Zing on theother hand 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 growth while maintaining healthy competition and encouraging synergy in backendoperations.
5. SUBSIDIARIES AND ASSOCIATE COMPANIES
As on March 31 2019 your Company has 1 (One) Wholly Owned Subsidiary2 (Two) Subsidiary Companies as mentioned in note no. 41 to the standalone financialstatements for the FY 2018-19. There has been no material change in the nature of businessof the subsidiaries. Subsidiary in Sri Lanka:
Your Company upon the approval of Board of Directors incorporated aJoint Venture (JV') Company with Satnet (Private) Limited a Companyincorporated under the Laws of Sri Lanka in the name and style of Dish T V Lanka(Private) Limited' for providing Direct to Home Services in Sri Lanka on April 252012 with a paid-up share capital of one (1) million Sri Lankan Rupees. Your Company holds70% of the paid-up share capital and Satnet (Private) Limited holds 30% of the paid-upshare Capital in Dish T V Lanka (Private) Limited. Dish T V Lanka (Private) Limited hadcommenced the operations under the requisite licenses and permissions obtained fromregulatory authorities. The Company has also been registered as a Board of Investment(BOI') approved Company in Sri Lanka. The registration with BOI grants variousbenefits to the Company.
Subsidiary in India:
1. Dish Infra Services Private Limited
Your Company upon the approval of Board of Directors and the Membersof the Company acquired the entire share capital of Xingmedia
Distribution Private Limited ('Xingmedia') on March 24 2014.Upon requisite approvals the name of Xingmedia was changed to Dish Infra ServicesPrivate Limited' (Dish Infra'). Post the approval of members of theCompany by way of a Special Resolution passed by Postal Ballot on February 3 2015 thenon-core business of the Company (undertaking pertaining to the provision of infra supportservices to the subscribers for facilitating the DTH services including the instrumentswhich are required for receiving DTH signals such as set top boxes (STB) dish antennaLow Noise Boxes (LNB) and other customer related services including call centre servicesand repairs) has been transferred to Dish Infra with effect from April 1 2015. Incompliance with the provision(s) of Regulation 24 of the Listing Regulations your Boardhad appointed Mr. Lakshmi Chand an Independent Director of the Company as an IndependentDirector on the Board of Dish Infra Services Private Limited. Upon Resignation of Mr.Chand with effect from August 17 2017 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) with effect from August 17 2017.
Post the approval of members of the Company by way of a SpecialResolution passed with requisite majority on September 25 2017 and with the completionof Amalgamation of Videocon D2H Limited with and into Company which became effective onMarch 22 2018 with the view to harmonize the existing business model of the Company theNon-Core Business undertaking of Infra Support Services (including set top boxes dishantenna etc. and related services) of Videocon D2H Limited together with respectiveassets and labilities (including employees/contracts etc. pertaining to such business)were transferred to Dish Infra from the close of the business hours of March 31 2018.
Further during the year under review your Company also approved theconversion of receivables from Dish Infra into shares and made further investment to thetune of `_3000 Crores in the equity share capital of Dish Infra by setting off the amountof Company's receivables from Dish Infra.
2. C&S Medianet Private Limited
Your Company upon the approval of Board of Directors incorporated anAssociate Company in the name and style of C&S Medianet Private Limited' onMay 5 2016. C&S Medianet Private Limited's initial paid up capital was Rs100000. Your Company acquired 48% of the initial capital i.e. 4800 equity sharesof Face
Value of 10/- each and Siti Networks Limited acquired 48% of theinitial capital i.e. 4800 equity shares of Face Value of 10/- each of C&SMedianet Private Limited. The said Company acts as a knowledge center for the distributionindustry by assisting them in various business facets including packaging contentacquisition regulatory interaction etc. The said Company has duly commenced itsoperations during the FY 2017-18.
During the previous year your Company upon approval of the Board haschanged the nomination on the Board of C&S Medianet Private Limited by appointing Mr.Ravi Bhushan Puri (DIN: 06686381) as the Nominee Director in place of Mr. Mukesh Mittal.During the year under review your Company upon approval of the Board of Directors onOctober 25 2018 purchased/acquired additional 300 (Three Hundred) equity shares ofC&S Medianet. Consequent to the said acquisition the percentage stake of the Companyin C&S Medianet increased from 48% to 51% and C&S Medianet became the subsidiaryof the Company with effect from November 1 2018.
Your Company funds its subsidiary (ies) from time to time as per thefund requirements through loans guarantees and other means to meet the working capitaland other business requirements. Apart from the above there is no other Subsidiary /Joint-venture/Associate within the meaning of 2(6) and 2(87) of the Act of the Company.
Audited Accounts of Subsidiary Companies:
Your Company has prepared the Audited Consolidated Financial Statementsin accordance with Section 129(3) of the Act read with the applicable Indian AccountingStandards and Listing Regulations. The statement pursuant to Section 129(3) of the Act andRule 5 of Companies (Accounts) Rules 2014 highlighting the summary of the financialperformance of the subsidiaries is annexed to this Report.
As required under the Indian Accounting Standards issued by theInstitute of Chartered Accountants of India (ICAI') and applicable provisionsof the Listing Regulations the Audited Consolidated Financial Statements of the Companyreflecting the Consolidation of the Accounts of its subsidiaries are included in thisAnnual Report. Further a statement containing the salient features of the financialstatements of the subsidiaries in the prescribed format AOC -1 is appended to this report.
In accordance with Section 136 of the Act the audited financialstatements including the consolidated financial statements and related information of theCompany and audited accounts of the subsidiaries are available on the website of theCompany viz. http://www. dishd2h.com. These documents will also be available forinspection during business hours at the Registered Office of the Company Your Company alsohas a policy for determining Material Subsidiaries in terms of the applicable regulations.As on March 31 2019 the Company has only one Material Subsidiary viz. Dish InfraServices
Private Limited. The Policy for determining Material Subsidiaries isavailable on the Company's website viz. http://www.dishd2h.com_and_is_accessible_at_http://www.dishd2h. com/media/1324/policyonmaterialsubsidiary.pdf.
6. CAPITAL STRUCTURE
During the year under review your Company:
Issued and allotted 17080 (Seventeen Thousand and Eighty) fully paidequity shares upon exercise of Stock Options by the eligible Employees of the Companypursuant to the
Employee Stock Option Scheme - 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 shareholdersin respect of Rights Issue the Company converted 121 (One Hundred and Twenty One) equityshares from Re. 0.75/- (Paisa Seventy Five) each paid up to Re. 1/- (Rupee one Only) eachfully paid up. Pursuant to the issue and allotment of equity shares under ESOP scheme andconversion of partly paid equity shares the paid-up share capital of your Company duringthe year has increased from:
Rs 1841257234.75/- (Rupees One Eighty Four Crore Twelve LakhFifty Seven Thousand Two Hundred Thirty Four and Seventy Five Paisa Only) (comprisingof 1841236752 (One Eighty Four Crore Twelve Lakh Thirty Six Thousand Seven hundredand Fifty Two) fully paid up equity shares of Re.1/- (Rupee one Only) each14567 (Fourteen Thousand Five Hundred and Sixty Seven) equity shares of Re.1/- (Rupeeone Only) each paid up Re.0.75 (Paisa Seventy Five Only) per equity share &19115 (Nineteen Thousand One Hundred and Fifteen) equity shares of Re.1/- (Rupeeone Only) each paid up Re.0.50 (Paisa Fifty Only) per equity share) to
Rs 1841274345/- (Rupees One Eighty Four Crore Twelve LakhSeventy Four Thousand Three Hundred and Forty Five) comprising of 1841253953 fullypaid up equity shares of Re.1/- (Rupee one Only) each 14446 (FourteenThousand Four Hundred and Forty-Six) equity shares of Re.1/- (Rupee one Only) eachpaid up Re.0.75 per equity share & 19115 (Nineteen Thousand One Hundred andFifteen) equity shares of Re.1/- (Rupee one Only) each paid up Re.0.50 (PaisaFifty Only) per equity share)
Further during the year under review there was no change in theauthorised share capital of the Company. The authorised share capital of the Company is Rs6500000000/- (Rupees Six hundred and Fifty Crore Only) divided into 6500000000 (Sixhundred and Fifty Crore) Equity shares of Re.1/- (Rupee One Only) each.
Listing of Company's Securities
Your Company's fully paid up equity shares continue to be listedand traded on National Stock 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 FY 2019-20 to the said Stock Exchanges. TheCompany has also paid the annual maintenance fee to the Luxembourg Stock Exchange inrespect of its Global Depository Receipts (GDR') program for the year 2019.
Further consequent to amalgamation of Videocon d2h Limited into andwith the Company your Company had issued new Global Depositary Receipts (the"GDRs") to the holders of American Depositary Shares ("ADSs") ofVideocon D2H Limited which are listed on the Professional Securities Market("PSM") of the London Stock Exchange. Necessary fees in relation to theGDR's of the Company listed on London Stock Exchange has also been paid.
Your Company has arrangements with National Securities DepositoryLimited (NSDL') and Central Depository Services (India) Limited(CDSL') the Depositories for facilitating the members to trade in the fullypaid up equity shares of the Company in Dematerialized form. The Annual Custody fees forthe FY 2019-20 has been paid to both the Depositories.
Open Offer by World Crest Advisors LLP
World Crest Advisors LLP a body corporate along with VeenaInvestments Private Limited and Direct Media Distribution Venture Private Limited PersonsActing in Concert ("PAC") (all forming part of Promoter and Promoter group ofthe Company) vide Letter of Offer dated June 20 2018 made an Open Offer to allthe Public Shareholders of the Company to acquire upto 500224893 (Fifty Crore Two LakhTwenty Four Thousand Eight Hundred and Ninety Three only) equity Shares of the Companyrepresenting 26% (Twenty Six Percent) of the Emerging Share Capital of the Company at anoffer price of Rs 74/- (Rupees Seventy Four only) per equity share. The PublicAnnouncement in relation to the aforesaid offer was made on April 12 2018 and DetailedPublic Announcement was published on April 18 2018 in Financial Express Jansatta andMumbai Lakshadeep Newspaper editions. The Draft Letter of Offer ("DLoF") wasfiled with SEBI on April 25 2018. Recommendations of the Committee of IndependentDirectors_of the Company was duly published on June 26 2018 in Financial ExpressJansatta and Mumbai Lakshadeep Newspaper editions in terms of applicable provisions.
In terms of Letter of offer the offer was made open from Monday July2 2018 to Friday July 13 2018. On completion of the offer period and in compliance withapplicable provisions World Crest Advisors LLP acquired in aggregate 446238855 (FortyFour Crores Sixty Two lakh Thirty Eight Thousand Eight Hundred and Fifty Five) equityshares of the Company.
The total shareholding of World Crest after the aforesaid acquisitionaggregated to 537738955 (Fifty Three Crore Seventy Seven Lakh Thirty Eight ThousandNine Hundred and Fifty Five) equity shares of face value of Re. 1 (Rupees One Only) eachof the Company amounting to 29.2% (Twenty Nine and Two percent) of the paid up sharecapital of the Company. The total shareholding of World Crest as on the date of thisreport is 507235875 (Fifty Crore Seventy Two Lakh Thirty Five Thousand Eight Hundredand Seventy Five) amounting to 57.54% (Fifty Seven and Fifty Four percent) of the paid upshare capital of the Company.
7. EMPLOYEE STOCK OPTION SCHEME
Your Company had instituted an Employees Stock Option Scheme (ESOP -2007) to motivate incentivize and reward employees. In compliance with the Securities andExchange Board of India (Share Based Employee Benefits) Regulations 2014 as amended fromtime to time your Board has authorized the Nomination and Remuneration Committee["NRC"] (formerly Remuneration Committee') to administer andimplement the Company's Employees Stock Option Scheme (ESOP 2007) includingdeciding and reviewing the eligibility criteria for grant and /or issuance of stockoptions under the Scheme. The ESOP Allotment Committee of the Board or Board considersreviews and allots equity shares to the eligible Employees exercising the stock optionsunder the Employee Stock Option Scheme (ESOP 2007) of the Company.
With a view to launch a new ESOP Scheme the NRC at its meeting held onAugust 17 2017 decided not to make any fresh grant of options under Employee StockOption Scheme (ESOP 2007) of the Company and proposed to withdraw the Scheme bycanceling the remaining stock options which are yet to be granted under the scheme.Accordingly no fresh grant of options was made during the year under review under theESOP-2007 scheme of the Company. However the Company allotted 17080 (Seventeen Thousandand Eighty) fully paid equity shares upon exercise of the stock options by eligibleEmployees under the scheme.
Further the NRC at its meeting held on August 17 2018 with anobjective to attract retain motivate incentivize and to attract and retain the besttalent recommended a new ESOP Scheme - "ESOP 2018" for the employees. The saidscheme was approved by the shareholders of the Company at its thirtieth (30th)Annual General Meeting held on September 28 2018. Further extension of benefits of thescheme to the employee(s) of subsidiary companies and to any future holding company wasalso approved by Shareholders vide Postal Ballot Notice dated October 25 2018.
During the period under review the NRC of the Board at its meetingheld on October 25 2018 granted 3360000 (Thirty Three Lakh Sixty Thousand) stockoptions to eligible Employee as per the ESOP 2018 Scheme of the Company. Furtherthe NRC of the Board at its meeting held on May 24 2019 granted 860000 (Eight Lakh SixtyThousand) stock options to eligible Employees as per the ESOP 2018 Scheme of theCompany.
Applicable disclosures relating to Employees Stock Options as at March31 2019 pursuant to Securities and Exchange Board of India (Share Based EmployeeBenefits) Regulations 2014 as amended from time to time is annexed to this report andis also available on the website of the Company athttp://www.dishd2h.com/corporate-governance/. The ESOP Schemes of the Company are incompliance with Securities and Exchange Board of India (Share Based Employee Benefits)Regulations 2014.
A certificate from M/s. Walker Chandiok & Co. LLP CharteredAccountants Statutory Auditors to the effect that the ESOP Schemes of the Company hasbeen implemented in accordance with the Securities and Exchange Board of India Guidelinesand as per the resolution passed by the members of the Company as prescribed underRegulation 13 of the Securities and Exchange Board of India (Share Based EmployeeBenefits) Regulations 2014 shall be placed before the shareholders at the ensuing AnnualGeneral Meeting and 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 (except Saturdays Sundays and Public holidays) between2.00 P.M. to 4.00 P.M. up to the date of Annual General Meeting of the Company.
8. RIGHT ISSUE OF SHARES & UTILISATION OF PROCEEDS THEREOF
The Company had come with a Right Issue in FY 2008-09 for 518149592(Fifty One Crore Eighty One Lakh Forty Nine Thousand Five Hundred and Ninety Two) equityshares of Re. 1/- (Rupees One Only) each issued at Rs 22/- (Rupees Twenty Two Only) pershare (including premium of Rs 21/- (Rupees Twenty One Only) per share) payable in three(3) installments. Out of the total Right Issue size of Rs 113992.91 Lakh the Company hasreceived a sum of Rs 113988.68 Lakh towards the share application and call money(s) as atMarch 31 2019. The details of utilization of Rights Issue proceeds are placed before theAudit Committee and the Board on a quarterly basis.
The Board at its meeting held on May 28 2009 approved to make changesin the manner of usage of right issue proceeds and the utilization of rights issueproceeds as on March 31 2019 is as under:
|Particulars ||Amount |
| ||(Rs In Lakhs) |
|Repayment of loans ||28421.44 |
|Repayment of loans received after launch of the Rights Issue ||24300.00 |
|General Corporate Purpose ||34722.72 |
|Acquisition of Consumer ||26000.00 |
|Premises Equipment (CPE) || |
|Right Issue Expenses ||544.52 |
|Total ||113988.68 |
9. GLOBAL DEPOSITORY RECEIPT
The Board of your Company at its meeting held on November 11 2016 hadapproved the Scheme of Arrangement amongst Videocon D2H Limited and Dish TV India Limitedand their respective Shareholders and Creditors (Scheme').
Videocon D2H Limited (the transferor Company in terms of Scheme) hadAmerican Depositary 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 anoption to elect and to either receive the shares of Dish TV India Limited or the GDR to beissued by Dish TV India Limited. Accordingly the ADS holders of Videocon D2H Limited wereissued Global Depositary Receipts (the "GDRs") of Company. The effective date ofissuance of GDRs was April 12 2018 and the same were listed on the ProfessionalSecurities Market ("PSM") of the London Stock Exchange on April 13 2018. Postreceipt 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 (Twenty Seven Crore Seventy Lakh Ninety FiveThousand Six hundred and Fifteen) Global Depositary Receipts (the "GDRs") to theholders of ADSs of Videocon D2H Limited (each GDR representing one equity share of theCompany exchanged at a rate of aptproximately 8.07331699 new GDRs for every one VideoconD2H Limited ADS (rounded off up to eight decimal places). The underlying equity sharesagainst each of the GDR's were issued in the name of the Depository viz.Deutsche Bank Trust Company Americas.
During the year under review out of the total 277095615 (TwentySeven Crore Seventy Lakh Ninety Five Thousand Six hundred and Fifteen) GDRs issued by theCompany upon completion of merger the Investors have cancelled 87909843 (Eight CroreSeventy Nine Lakh Nine Thousand Eight Hundred and Forty Three) GDRs in exchange forunderlying equity shares of the Company accordingly as on March 31 2019 the outstandingGDRs of the Company are 189185772 (Eighteen Crore Ninety One Lakh Eighty Five ThousandSeven Hundred and Seventy Two).
10. REGISTERED OFFICE
The Registered Office of the Company is presently situated at 18thFloor A Wing Marathon Futurex N M Joshi Marg Lower Parel Mumbai-400 013 Maharashtra.
11. REGISTRAR & SHARE TRANSFER AGENT
The Registrar & Share Transfer Agent (RTA') of theCompany is Link Intime India Private Limited. The Registered office of Link Intime IndiaPrivate Limited is situated at C 101 247 Park LBS Marg Vikhroli (West) Mumbai - 400083 Maharashtra.
12. CORPORATE GOVERNANCE AND POLICIES
We believe Corporate Governance' is a journey rather than adestination. Our understanding to an effective Corporate Governance practices constitutethe strong foundation on which successful commercial enterprises are built to last. Webelieve that a Company is a public entity of society and hence we consider ourstakeholders as partners in our journey forward. We are committed to ensure theirwell-being despite the challenges and economic volatilities for sustained corporategrowth.
In order to maximize shareholder value on a sustained basis yourCompany has been constantly reassessing and benchmarking itself with well-establishedCorporate Governance practices besides strictly complying with the requirements of ListingRegulations applicable provisions of the Act and applicable Secretarial Standards issuedby the Institute of Company Secretaries of India. In terms to the requirement ofRegulation 34 read with Schedule V of the Listing Regulations a detailed report onCorporate Governance along with Compliance Certificate issued by M/s. Jayant Gupta andAssociates Practicing Company Secretary is attached and forms an integral part of thisAnnual Report. Management Discussion and Analysis Report and Business ResponsibilityReport as per the Listing Regulations are presented in separate sections forming part ofthe Annual Report. The said Reports will also be available on the Company's websitewww.dishd2h.com as part of the Annual Report.
In compliance with the requirements of the Act and the ListingRegulations your Board has approved various Policies including Code of Conduct for Boardof Directors and Senior Management Policy for determining material subsidiaries Code ofinternal procedures and conduct for prohibition of insider trading in securities of DishTV India Limited Policy for preservation of documents & archival of records onwebsite Policy for determining material event Policy for fair disclosure of unpublishedprice sensitive information Corporate Social Responsibility Policy Whistle blower &Vigil mechanism Related Party Transaction Policy Dividend distribution policy andNomination and Remuneration Policy. These policies and codes along with the Directorsfamiliarisation programme and terms and conditions for appointment of independentdirectors are available on Company's website viz. www.dishd2h.com and isaccessible at http://www.dishd2h.com/corporate-governance/.
In compliance with the requirements of Section 178 of the Act the NRCof your Board has fixed the criteria for nominating a person on the Board which inter aliainclude desired size and composition of the Board age limits qualification / experienceareas of expertise and independence of individual. Further in compliance with theSecurities and Exchange Board of India (Prohibition of Insider Trading) Regulations 2015(PIT Regulations) on prevention of insider trading your Company has instituted acomprehensive Code of Conduct for regulating monitoring and reporting of trading byInsiders.
The said Code lays down guidelines which advise Insiders on theprocedures to be followed and disclosures to be made in dealing with the shares of theCompany and cautions them on consequences of non-compliances. Your Company has further putin place a Code of practices and procedures of fair disclosures of unpublished pricesensitive information. Both the aforesaid codes are in line with the PIT Regulations andwere revised in line with the Securities and Exchange Board of India (Prohibition ofInsider Trading) (Amendment) Regulations 2018 (Amendment Regulations'). Thesaid codes are applicable to all Directors KMPs and other Designated Persons asidentified in the Code who may have access to unpublished price sensitive information ofthe Company. The Company has also complied with the other requirements of AmendmentRegulations.
The Audit Committee of the Board has been vested with powers andfunctions relating to Risk Management which inter alia includes (a) review of riskmanagement policies and business processes to ensure that the business processes adoptedand transactions entered into by the Company are designed to identify and mitigatepotential risk; (b) laying down procedures relating to Risk assessment and minimization;and (c) formulation implementation and monitoring of the risk management plan.
Your Company in line with the amendments to the Listing Regulations hasconstituted the Risk Management Committee who shall access the Company's riskprofile acceptable level of risk develop and maintain risk management framework and suchother functions as may be entrusted to it by the board which shall specifically cover thecyber security.
13. DIRECTORS' & KEY MANAGERIAL PERSONNEL Directors
As on March 31 2019 your Board comprised of Six (6) Directorsincluding Three (3) Independent Directors Two (2) Executive Directors and One (1)Non-Executive Non-Independent Director. During FY 2018-2019 your Board met 6 (six) timesdetails of which are available in the Corporate Governance Report annexed to this report.
During the year under review Mr. Arun Duggal an Independent Directorhas resigned from the Board of the Company with effect from May 18 2018 on account of hisother professional obligations and commitments due to which he would not have been able todevote in future the time that is needed as the Director of the Company. Mr. Duggal hadalso confirmed that there was no material reason other than that mentioned hereinabove inrespect of his resignation. Your Board took note of the said resignation at its meetingheld on May 29 2018 and placed on record its appreciation for the contributions made byhim during his tenure.
Further during the year under review your Board has inducted Mr.Shankar Aggarwal as an Independent Director (Additional) with effect from October 252018. In terms of Section 161 of the Act Mr. Shankar Aggarwal shall hold office up to thedate of the ensuing Annual General meeting. The Company has received a notice in writingfrom a member of the Company under Section 160 of the Act proposing appointment of Mr.Shankar Aggarwal as the Director of the Company. Your Board basis the recommendation ofNRC recommends the appointment of Mr. Shankar Aggarwal as an
Independent Director not liable to retire by rotation for a period ofFive (5) years from the date of appointment i.e. October 25 2018 to October 242023.
Further in compliance with the necessary provisions and amendments tothe Listing Regulations and the Act your Board subsequently inducted Mr. Anil Kumar Duathe Group Chief Executive Officer (CEO) of the Company as an Executive Director(Additional) on the Board of the Company with effect from March 26 2019.
In terms of Section 161 of the Act Mr. Anil Kumar Dua shall holdoffice up to the date of the ensuing Annual General meeting. The Company has received anotice in writing from a member of the Company under Section 160 of the Act proposingappointment of Mr. Anil Kumar Dua as the Director of the Company. Your Board basis therecommendation of NRC recommends the appointment of Mr. Anil Kumar Dua as a Whole-timeDirector (designated as Executive Director) subject to the approval of the members for aperiod of 3 (three) years from March 26 2019 to March 25 2022 who will be liable toretire by rotation. Further the members of the Company at their 29th AnnualGeneral Meeting held on September 28 2017 approved the re-appointment of Mr. Bhagwan DasNarang as an Independent Director of the Company for a Second term of 5 (Five) years fromthe date of the 29th Annual General Meeting upto the date of 34thAnnual General Meeting of the Company to be held in the Calendar Year 2022. Mr. Narang ispresently aged 74 years and in terms of Regulation 17(1A) of the Listing Regulationsapproval of the shareholders by way of a special resolution is required for thecontinuation of directorship of the Non-executive Director of the Company who has attainedthe age of 75 years. Accordingly the continuation of Directorship of Mr. Narang as theIndependent Director of the Company for his existing second term would require priorapproval of members by way of special resolution. Requisite approval by way of Specialresolution in continuation of original resolution passed by members of the Company at the29th Annual General Meeting held on September 28 2017 for continuing theexisting term of Mr._Bhagwan Das Narang as an Independent Director forms part of Notice ofthe ensuing Annual General Meeting of the Company.
Further Mr. Ashok Mathai Kurien Non-Executive Non-IndependentDirector of the Company is liable to retire by rotation at the ensuing Annual GeneralMeeting and being eligible has offered himself for re-appointment. Your Board recommendshis reappointment.
During the year under review there was no change in the Key ManagerialPersonnel of the Company. In compliance with the requirements of Section 203 of the Actas on the date of this report Mr. Jawahar Lal Goel Managing Director and Chairman Mr.Anil Kumar Dua Group Chief Executive Officer and Executive Director Mr. Rajeev KumarDalmia Chief Financial Officer and Mr. Ranjit Singh Company Secretary and ComplianceOfficer of the Company are Key Managerial Personnel of the Company.
Chairman & Managing Director
Mr. Jawahar Lal Goel continues to be the Chairman and ManagingDirector of the Company. Under the leadership of Mr. Goel the Company has continuouslymaintained growth in terms of revenue as well as continued its stronghold on the Direct toHome (DTH) market share. The Company has made considerable progress in all the spheres andhas achieved tremendous growth and acquired goodwill and reputation in the business. Mr.Goel has spearheaded the organization with strong zeal and commitment despite strongcompetitive intensity regulatory challenges and technological upheavals. Mr. Goel has ledyour Company in a highly competitive and volatile market to not just consolidate itsmarket leadership but also in shaping the future of your Company into a modern technology& innovation-driven organisation.
As on March 31 2019 your Board comprises of Six (6) Directors out ofwhich Three (3) are Independent Directors (including (1) Women Director). The Companyrecognizes and embraces the importance of a diverse Board in its success. The Board hasalso adopted the Board Diversity Policy.
The Board met Six (6) times during the FY the details of which aregiven in the Corporate Governance Report which forms part of this Annual Report. Theintervening gap between any two (2) meetings was within the period prescribed by the Actand the Listing Regulations.
Declaration by Independent Directors
Independent Directors provide declarations both at the time ofappointment and on or before the first Board Meeting of the FY confirming that they meetthe criteria of independence as prescribed under Section 149 of the Act and Regulation 16and 25 of the Listing Regulations in addition to their affirmation on the compliance withthe Company's code of conduct. Your Company has received the said declarations fromall the Independent Directors. In the opinion of the Board Independent Directors fulfilthe conditions specified in the Act Rules made thereunder and the Listing Regulations andare Independent of the management.
Separate Meeting of the Independent Directors
In accordance with the provisions of Schedule IV to the Act andRegulation 25(3) of the Listing Regulations separate meeting of the Independent Directorsof the Company was held on March 26 2019 to discuss relevant items including the agendaitems as prescribed under the applicable laws. The meetings were attended by all theIndependent Directors of the Company.
In line with the Corporate Governance Guidelines of your Company aformal evaluation of the performance of the Board its Committees the Chairman and theindividual Directors was carried out for the FY 2018-19 on March 26 2019. The Boardevaluation framework has been designed in compliance with the requirements specified underthe Act the Listing Regulations and in accordance with the Guidance Note on BoardEvaluation issued by SEBI on January 5 2017.
The Independent Directors of your Company in a separate meeting heldwithout presence of other Directors and management evaluated the performance of theChairman & Managing Director and other Non-Independent Directors along with theperformance of the Board / Board Committees based on various criteria recommended by theNRC and Guidance Note on Board Evaluation' dated January 5 2017 issued by theSecurities and Exchange Board of India. A report on such evaluation done by theIndependent Directors was taken on record by the Board and further your Board incompliance with requirements of the Act evaluated performance of all the Directors Board/ Board Committees based on various parameters including attendance contribution etc. Thedetails of the evaluation process are set out in the Corporate Governance Report whichforms part of this Report.
Policy on Directors' appointment and remuneration
In compliance with the requirements of Section 178 of the Act the NRCof your Board had fixed the criteria for nominating a person on the Board which interalia include desired size and composition of the Board age limit qualification /experience areas of expertise and independence of individual. Your Company has alsoadopted a Remuneration Policy salient features whereof is annexed to this report.
Further pursuant to provisions of the Act the NRC Committee of yourBoard has formulated the Nomination and Remuneration Policy for the appointment anddetermination of remuneration of the Directors Key Management Personnel SeniorManagement and other Employees of your Company. The NRC Committee has also developed thecriteria for determining the qualifications positive attributes and independence ofDirectors and for making payments to Executive Directors of the Company.
The NRC Committee takes into consideration the best remunerationpractices in the industry while fixing appropriate remuneration packages and foradministering 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 thesetof principle senumerated in the said policy. Your Directorsaffirm that the remuneration paid to the Directors Key Management Personnel SeniorManagement and other employees is as per the Nomination and Remuneration Policy of yourCompany.
The remuneration details of the Executive Director Chief ExecutiveOfficer Chief Financial Officer and Company Secretary along with details of ratio ofremuneration of Director to the median remuneration of employees of the Company for the FYunder review are provided as Annexure to this Report.
Familiarisation Programme for Independent Directors
Your Company regularly provides orientation and business overview toits Directors by way of detailed presentations by the various business & functionalheads at Board meetings and through other interactive programs.
During the year under review to familiarize the Directors withstrategy operations and functions of the Company the senior managerial personnel madepresentations about Company's strategy operations product offering markettechnology facilities and risk management. The Directors were also provided with relevantdocuments reports and internal policies to enable them to familiarise with yourCompany's procedures and practices from time to time besides regular briefing bythe members of the senior leadership team.
Also the Board including all Independent Directors were given adetailed presentation on March 26 2019 by Ernst & Young LLP on key applicableamendments to the Listing Regulations the Act and key roles and responsibilities ofDirectors. Further at the time of appointment of an Independent Director the Companyissues a formal letter of appointment outlining their duties and responsibilities as aDirector. Detail of familiarisation program organized for Independent Directors during FYunder review form part of Corporate Governance Report annexed hereto and are also postedon the Company's website viz. http://www.dishd2h.com/ and can be viewed on thefollowing link: http://www.dishd2h. com/corporate-governance/
Committees of the Board
In compliance with the requirements of the Act and the ListingRegulations your Board has constituted various Board Committees including AuditCommittee NRC Stakeholder's Relationship Committee Corporate Social ResponsibilityCommittee and Risk Management Committee. During the period under review in view ofresignation of Mr. Arun Duggal Independent Director from the Board and committeesthereof with effect from May 18 2018 the Board at its meeting held on May 29 2018re-constituted the Composition of Board Committees. As on March 31 2019 the AuditCommittee of Board consisted of Mr. Bhagwan Das Narang an Independent Director as theChairman of the Committee and Mr. Ashok Mathai Kurien Non-Executive Non IndependentDirector and Dr. (Mrs.) Rashmi Aggarwal Independent Director as its members.
Further consequent to appointment of Mr. Shankar Aggarwal as anAdditional Independent Director of the Company with effect from October 25 2018 theBoard at its meeting held on May 24 2019 reconstituted the Composition of BoardCommittees with Mr. Shankar Aggarwal Independent Director as its member with effect fromJuly 01 2019. As on the date of this report the Audit Committee of the Board consists ofMr. Bhagwan Das Narang an Independent Director as the Chairman of the Committee and Mr.Ashok Mathai Kurien Non-Executive Non Independent Director Dr. (Mrs.) Rashmi AggarwalIndependent Director and Mr. Shankar Aggarwal Independent Director as its members.
Further during the year under review in line with the amendments tothe Listing Regulations the Board has constituted the Risk Management Committee with Mr.Bhagwan Das Narang an Independent Director as the Chairman of the Committee Mr. JawaharLal Goel Managing Director Mr. Shankar Aggarwal Independent Director Dr. (Mrs.) RashmiAggarwal Independent Director Mr. Veerender Gupta Chief Technology Officer and Mr.Rajeev Kumar Dalmia Chief Financial Officer as its members.
Details of the constitution of the Board Committees 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.
Vigil Mechanism/ Whistle Blower Policy
Your Company is committed to highest standards of ethical moral andlegal business conduct. Accordingly the Board of Directors has formulated a VigilMechanism/Whistle Blower policy which provides a robust framework for dealing with genuineconcerns & grievances. The policy provides access to Directors/ Employees/Stakeholdersof the Company to report concerns about unethical behavior actual or suspected fraud ofany Director and/or Employee of the Company or any violation of the code of conduct. Thepolicy safeguards whistleblowers from reprisals or victimization in line with theAmendment Regulations and to make the policy much more robust necessary changes werecarried to the Whistle Blower policy. Further during the year under review no case wasreported under the Vigil Mechanism. In terms of the said policy no personnel has beendenied access to the Audit Committee of the Board. The said policy is accessible onhttp:// www.dishd2h.com/corporate-governance/.
Your Company is required to maintain the Cost Records as specified bythe Central Government under sub-section (1) of Section 148 of the Act read withNotification No. GSR. 695(E) dated July 14 2016 of the Ministry of Corporate Affairs.
Your board at its meeting held on May 29 2018 had re-appointed M/sChandra Wadhwa & Co. (Firm Registration No. 000239) Cost Accountants to carry outAudit of Cost Records of the Company for the Financial Year 2018-19. The Cost Auditorshave issued their report for the Financial Year 2018-19 which has been taken on record bythe Audit / Board of the Company at its meeting held on July 30 2019.
14. CORPORATE SOCIAL RESPONSIBILITY
In compliance with requirements of Section 135 of the Act your Companyhas a duly constituted Corporate Social Responsibility (CSR) Committee. Mr. Arun DuggalIndependent Director and Member of the committee resigned from the Board and Committeesthereof with effect from May 18 2018 due to professional obligations and commitments.Post resignation of Mr. Arun Duggal the Committee comprises of four (4) members includingtwo (2) Independent Directors. As on March 31 2019 the CSR Committee of Board consistedof Mr. Bhagwan Das Narang an Independent Director as the Chairman of the Committee Mr.Jawahar Lal Goel Managing Director Mr. Ashok Mathai Kurien Non-Executive NonIndependent Director and Dr. (Mrs.) Rashmi Aggarwal Independent Director as its members.Further consequent to appointment of Mr. Shankar Aggarwal as an Independent Director(Additional) of the Company with effect from October 25 2018 the Board at its meetingheld on May 24 2019 reconstituted the CSR Committee with Mr. Shankar AggarwalIndependent Director as its member with effect from July 1 2019.
Accordingly as on the date of this report CSR Committee of Boardconsists of Mr. Bhagwan Das Narang an Independent Director as the Chairman of theCommittee Mr. Jawahar Lal Goel Managing Director Mr. Ashok Mathai Kurien Non-ExecutiveNon Independent Director Dr. Rashmi Aggarwal and Mr. Shankar Aggarwal IndependentDirector as its member.
Your Company has adopted a unified approach towards CSR whereincontributions are pooled in to fund high cost long-term projects that help build Humancapital and create lasting impact on the society. The Committee has approved the CSRpolicy with Education Health Care Women Empowerment and Sports as its primary focusarea. The Company makes the CSR Contribution to Subhash Chandra Foundation' (aSection 8 Company) for various CSR activities including Contribution to skill developmentand livelihood enhancement project through "Project Samriddh" development offacilities for promotion of education undertaking Rural transformation Initiative inSABKA Cluster of Hisar District (H.R) developing Sports Skills through establishingSports Centers and Youth development through Life Skill Program. A detailed report on CSRactivities initiated by the Company during the year under review in compliance with therequirements of the Act is annexed to this report.
15. POSTAL BALLOT
During the year under review your Company sought the approval of theShareholders through Postal Ballot on the below matters:
Postal Ballot Notice dated October 25 2018 seeking Shareholdersconsent through Special Resolution for:
- For extension of benefits of Dish TV India limited EmployeesStock Option Scheme 2018' ("ESOP 2018"} - for employees of the SubsidiaryCompany(ies) of the Company
- For extension of benefits of Dish TV India limited EmployeesStock Option Scheme 2018' ("ESOP 2018"} -for employees of any futureholding Company of the Company The said notice along with the postal ballot form andBusiness Reply Envelopes were duly sent to the shareholders and your Company also offeredE-Voting facility as an alternate option for voting by the shareholders which enabledthem to cast their votes electronically instead of Physical Postal Ballot Form. The saidresolution was passed with requisite majority and the result of the same was declared onNovember 30 2018
The procedure prescribed under Section 110 of the Act read with theCompanies (Management and Administration) Rules 2014 was adopted for conducting thePostal Ballot. 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.
16. AUDITORS Statutory Auditors
At the 26th Annual General Meeting of the Company held onSeptember 29 2014 M/s. Walker Chandiok & Co. LLP Chartered Accountants 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 as the StatutoryAuditors' 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 Act and the Rules framed thereunder the mandatory requirement for ratificationof appointment of Auditors by the Members at every Annual General Meeting has beenomitted. Accordingly the notice of ensuing Annual General Meeting does not include theproposal for seeking shareholders' approval for ratification of statutoryauditors' appointment. The Company has received certificate of eligibility from M/sWalker Chandiok & Co LLP Chartered Accountants in accordance with the provisions ofthe Act read with rules thereunder and a confirmation that they continue to hold validpeer review certificate as required under the Listing Regulations.
During the year the Board re-appointed Mr. Jayant Gupta PracticingCompany Secretary (holding ICSI Certificate of Practice No. 9738) proprietor of M/sJayant Gupta & Associates Company Secretaries as the Secretarial Auditor of theCompany for conducting the Secretarial Audit for the FY 2018-19 in accordance with Section204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 made thereunder. Dish Infra Services Private Limited the unlisted materialsubsidiary of your company appointed Anjali Yadav & Associates Practicing CompanySecretary (holding ICSI Certificate of Practice No. 7257) as its Secretarial Auditor toconduct the Secretarial Audit for the FY 2018-19. The said Audit has been conducted inaccordance with Section 204 of the Act the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 made thereunder and in compliance to Regulation 24A ofthe Listing Regulations. The said report does not contain any qualification reservationor adverse remarks.
Additionally in line with SEBI Circular dated February 8 2019 anAnnual Secretarial Compliance Report confirming compliance of all applicable SEBIRegulations Circulars and Guidelines by the Company was issued by the Secretarial Auditorand filed with the Stock Exchanges.
The reports of Statutory Auditor and Secretarial Auditor forming partof this Annual report do not contain any qualification reservation or adverse remarks.During the year the Statutory Auditors have not reported any matter under Section 143 (12)of the Act therefore no detail is required to be disclosed under the applicableprovisions of the Act.
In compliance with the requirements of Section 148 of the Act read withCompanies (Cost Records and Audit) Rules 2014 as amended from time to time M/s ChandraWadhwa & Co. (Firm Registration No. 000239) Cost Accountants were appointed tocarry out Audit of Cost Records of the Company for the FY 2018-19. 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. 000239) CostAccountants as the Cost Auditors for the FY ending March 31 2020.
Requisite proposal seeking ratification of remuneration payable to theCost Auditor for the FY 2019-20 by the Members as per Section 148 read with Rule 14 ofCompanies (Audit and Auditors) Rules 2014 forms part of the Notice of ensuing AnnualGeneral Meeting.
Protiviti Advisory India Member LLP was the internal auditor of theCompany for the FY 2018-19. The Audit Committee at its meeting held on May 24 2019recommended to the Board for reappointment of Protiviti Advisory India Member LLP as theInternal Auditor of the Company for the FY 2019- 20. Basis the recommendation of the AuditCommittee the Board at its meeting held on May 24 2019 has re-appointed ProtivitiAdvisory India Member LLP as the Internal Auditor of the Company for the FY 2019-20.
Reporting of frauds by Auditors
During the year under review the Auditors have not reported anyinstances of frauds committed in the Company by its Officers or Employees to the AuditCommittee under Section 143(12) of the Act.
i. Particulars of Loans guarantees and investments:Particulars of Loans guarantees and investments made by the Company required underSection 186(4) of the Act and the Listing Regulations are contained in Note no. 70 to theStandalone Financial Statement.
ii. Transactions with Related Parties: In terms of the applicablestatutory provisions the related party transactions are placed before the Audit Committeefor its approval and statements of all related party transactions are placed before theAudit Committee for its review on a quarterly and yearly basis specifying the naturevalue and terms and conditions of the transactions along with arms-length justification.All Related Party Transactions entered during the year were in Ordinary Course of theBusiness and on Arm's Length basis. During the year under review there have been nomaterially significant related party transactions as defined under Section 188 of the Actand Regulations 23 of the Listing Regulations and accordingly no transactions are requiredto be reported in Form AOC-2 as per Section 188 of the Act.
iii. Disclosure under Section 197(14) of the Act: NeitherMr. Jawahar Lal Goel Managing Director & Chairman of the Company nor Mr. Anil KumarDua Group Chief Executive Officer of the Company receive any remuneration or commissionfrom_its_holding_or_subsidiary_company.
iv. Secretarial Standards: Pursuant to the provisions of Section118 of the Act the Company has complied with the applicable provisions of the SecretarialStandards issued by the Institute of Company Secretaries of India and notified by Ministryof Corporate Affairs.
v. Risk Management: Your Company follows a comprehensivesystem of Risk Management. It has adopted a policy and procedure for rapid identificationdefinition of risk mitigation plans and execution. Actions include adjustments in pricesdispatch plan inventory build-up and active participation in regulatory mechanisms. Manyof these risks can be foreseen through systematic tracking. Your Company has also definedoperational processes to ensure that risks are identified and the operating management areresponsible for identifying and implementing mitigation plans for operational and processrisk. Key strategic and business risks are identified and managed by senior managementteam.
The Risks and their mitigation plans are updated and reviewedperiodically by the Audit Committee and integrated in the Business plan for each year. Inline with the amendments to the Listing Regulations the Company has constituted the RiskManagement Committee. The details of Constitution scope and meetings of the RiskManagement Committee forms part of the Corporate Governance Report. In the opinion of theBoard there are no risks that may threaten the existence of the Company.
vi. Internal Financial Controls and their adequacy: Yourcompany has an effective internal control and risk mitigation system which is constantlyassessed and strengthened with standard operating procedures and which ensures that allthe assets of the Company are safeguarded & protected against any loss prevention anddetection of frauds and errors ensuring accuracy and completeness of the accountingrecords timely preparation of reliable financial information and that all transactionsare properly authorized and recorded.
The Company has laid down procedures to inform audit committee andboard about the risk assessment and mitigation procedures to ensure that the managementcontrols risk through means of a properly defined framework. The Audit Committee evaluatesthe internal financial control system periodically and deals with accounting mattersfinancial reporting and periodically reviews the Risk Management Process. Based oninternal financial control framework and compliance systems established in the Companythe work performed by statutory internal and secretarial auditors and reviews performedby the management and/or relevant Audit and other Committees of the Board your Board isof the opinion that the Company's internal financial controls were adequate andeffective during the FY 2018-19. During the year no reportable material weakness in thedesign or operation was observed.
vii . Deposits: Your Company has not accepted any publicdeposit under Chapter V of the Act.
viii . Transfer to Investor Education and Protection
Fund: During the year under review the Company was not required totransfer any amount to Investor Education and Protection Fund.
During the FY 2017-18 in compliance with the requirements of theInvestor Education and Protection Fund Authority (Accounting Audit Transfer and Refund)Rules 2016 (IEPF Rules) as amended your Company had transferred an amount of Rs 573250(Rupees Five Lakh Seventy Three Thousand Two Hundred and Fifty Only) to Investor Educationand Protection Fund on account of unpaid sale proceeds of Fraction shares under the Schemeof Arrangement pending for seven (7) or more years. The said amount can be claimed by theShareholders from IEPF authority after following process prescribed in IEPF Rules.
ix. Unclaimed Dividend/Shares: As on March 31 2019 your Companyhad an outstanding balance of 63622 (Sixty Three Thousand Six hundred and Twenty Two)unclaimed shares lying in the Suspense Account of the Company. Necessary steps were takenin Compliance with the Listing Regulations for sending the necessary reminders to theclaimant of the said shares at the address available in the data base of theDepository/Company.
Further the Interim Dividend declared by the Company which remainsunpaid or unclaimed has been transferred by the Company to "Dish TV India Limited unpaid Interim Dividend FY 2018-19" account and will be due for transfer tothe Investor Education and Protection Fund on completion of seven (7) years.
x. Transfer to General Reserve: During the FY under review noamount has been transferred to the General Reserve of the Company
xi. Extract of Annual Return: The extract of Annual return in formMGT-9 as required under Section 92(3) of the Act read with Companies (Management &Administration) Rules 2014 is annexed to this report.
xii. Sexual Harassment: The Company has zero tolerance forSexual Harassment at workplace. The company has complied with the provisions relating tothe constitution of Internal Complaints Committee under the Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013. The Company has constitutedInternal Complaint(s) Committee functioning at various locations to redress complaintsregarding sexual harassment and has adopted a Policy on prevention of Sexual Harassment inline with the provisions of The Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013'. During the year under review no complaint wasreceived by the Company.
xiii. Regulatory Orders: No significant or material orders werepassed by the regulators or courts or tribunals which impact the going concern status andCompany's operations in future.
18. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGEEARNING AND OUTGO
Your Company is in the business of providing Direct-to- Home(DTH') services. Since the said activity does not involve any manufacturingactivity most of the Information required to be provided under Section 134(3) (m) of theAct read 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 energyconsumption and every endeavor is made to ensure optimal use of energy avoid wastages andconserve energy as far as possible.
In its endeavor to deliver the best to its viewers and businesspartners your Company is constantly active in harnessing and tapping the latest and besttechnology in the industry.
Foreign Exchange Earnings and Outgo:
During the year under review your Company had 718 Lakhs and foreignexchange earnings of Rs outgo of Rs 7254 Lakhs.
During the Financial Year under review CARE (Credit Analysis andResearch Limited) a Credit rating agency had assigned CARE A1 (CARE A One) for Short TermBank Facilities of the Company. CARE had revised the said rating to CARE A3 (CARE A Three)and then revised the same to CARE A3+ (CARE A Three Plus) for Short Term Bank Facilitiesof the Company in the month of July 2019. CARE has revised the rating basis the recentdevelopments including operational and financial performance of the Company for FY19(Abridged) and the observation of the credit rating agency regarding removal of support ofEssel group built into the ratings due to the weakened financial flexibility at the Esselgroup level. Instruments with this rating are considered to have moderate degree of safetyregarding timely payment of financial obligations.
20. HUMAN RESOURCE MANAGEMENT
Human Resource Management has been one of the key priorities foryour company over the last financial year. The merger presented your company with multipleopportunities for refreshing the people practices. 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 an organization that is agile and highlyefficient your company has undergone a complete restructuring exercise. The new structurehas been designed keeping in mind the business priorities and long term strategic goalsof your company. A general principle was to combine non-customer facing functions toattain synergies but retain customer facing functions and processes as both brands shallbe operating separately in the market. We have consolidated number of circles and officesin phased manner for better operational performance and cost efficiency. Circle BusinessHead for each Circle are now responsible for the P&L of the Circle reporting to therespective Business Head.
While aligning the new structure a flatter organization was createdwith 5 Bands and 10 Levels from erstwhile ~15 levels to enable empowerment across levelseffective communication collaboration and faster decision making. Further the legacydesignations' created significant layers in the organization. So it was decidedto move away from traditional titles and adopt a role based titling nomenclature. To bringsynergies in policies and people processes your company adopted the best practices ofboth the organizations as well as the industry and overhauled the existing policies. Toachieve synergy benefits and higher productivity we conducted manpower optimizationexercise during the year to identify redundant roles through structured processreengineering identifying redundant/ duplicate roles organizational structurerealignment and optimum span of control.
In order to create value based organization to deliver sustainableperformance over time values were redefined through a culture survey conducted by a thirdparty. These values have been amalgamated to align the overall value system to thebusiness strategy and vision. Your company believes that it's not just important forall employees to understand the essence of these values but also imbibe them and live bythem every single day. Therefore workshops have been conducted for employees across thecountry so they understand and exhibit these values in their work and behaviour.
Our core values are integrated with 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. Values will also be integrated in the hiring philosophy and reward &recognition programs. Your Company has created a favorable work environment following theSAMWAD philosophy which encourages innovation meritocracy and team collaboration. Thisyear we have achieved the highest ever employee engagement scores which is at par with tobest in class. The Company is committed to nurturing enhancing and retaining talentthrough superior Learning & Organization Development interventions. With all thesechanges your company is fully geared up in its quest for future success and capitalize ona host of new opportunities ahead. Your Directors place on record their appreciation forthe significant contribution made by all employees who through their competencededication hard work co-operation and support have enabled the Company to crossmilestones on a continual basis.
Particulars of Employees
As on March 31 2019 the total numbers of permanent employees on therecords of the Company were 486 (Four hundred and Eighty Six). The information requiredunder Section 197(12) of the Act read with Rule 5 of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 along with statement showing names andother particulars of the employees drawing remuneration in excess of the limits prescribedunder the said rules is annexed to this report.
21. DIRECTORS' RESPONSIBILITY STATEMENT
In terms of and pursuant to Section 134 of the Act in relation to theAnnual Financial Statements for the FY 2018-19 your Directors state and confirm that:
a) The Financial Statements of the Company comprising of the BalanceSheet as at March 31 2019 and the Statement of Profit & Loss for the year ended onthat date have been prepared on a going concern basis;
b) In the preparation of these Financial Statements the applicableaccounting standards had been followed and there are no material departures;
c) Accounting policies selected were applied consistently and thejudgments and estimates related to the financial statements have been made on a prudentand reasonable basis so as to give a true and fair view of the state of affairs of theCompany as at March 31 2019 and of the profit of the Company for the year ended on thatdate;
d) Proper and sufficient care has been taken for maintenance ofadequate accounting records in accordance with the provisions of the Act to safeguard theassets of the Company and for preventing and detecting fraud and other irregularities;
e) Requisite internal financial controls were laid down and that suchfinancial controls are adequate and operating effectively; and
f) Proper systems have been devised to ensure compliance with theprovisions of all applicable laws and such systems are adequate and operating effectively.
22. BUSINESS RESPONSIBILITY REPORT & MANAGEMENT DISCUSSION ANDANALYSIS
The Business Responsibility Report (BRR') has been preparedand forms part of the Annual Report as Annexure. The Report provides an overview ofinitiatives taken by your Company.
The Management Discussion and Analysis report as provided under theListing Regulations is separately attached hereto and forms an integral part of thisAnnual Report. The said report gives details of the overall industry structure economicdevelopments performance and state of affairs of your Company's business and othermaterial developments during the FY under review.
23. INDUSTRIAL OPERATIONS
The Company maintained healthy cordial and harmonious industrialrelations at all levels. The enthusiasm and unstinting efforts of the employees haveenabled the Company to remain at the leadership position in the industry. It has takenvarious steps to improve productivity across the organization.
24. CAUTIONARY STATEMENT
Statements in this Report particularly those which relate toManagement Discussion and Analysis describing the Company's objectives projectionsestimates and expectations may constitute forward looking statements' withinthe meaning of applicable laws and regulations and actual results might differ.
It is our strong belief that caring for our business constituents hasensured our success in the past and will do so in future. Your Directors value theprofessionalism and commitment of all employees of the Company and place on record theirappreciation of the contribution made by employees of the Company and its subsidiaries atall levels that has contributed to your Company's success. Your Directors acknowledgewith sincere gratitude the co-operation and support extended by the Central and StateGovernments the Ministry of Information and Broadcasting (MIB') theDepartment of Telecommunication (DOT') Ministry of Finance the TelecomRegulatory Authority of India (TRAI') the Stock Exchanges and otherstakeholders including employees subscribers vendors bankers investors serviceproviders as well as other regulatory and government authorities.
Your Board also takes this opportunity to express its deep gratitudefor the continued co-operation and support received from its valued stakeholders. For andon behalf of the Board
|Jawahar Lal Goel ||B. D. Narang |
|Chairman & Managing Director ||Independent Director |
|DIN: 00076462 ||DIN: 00826573 |
|Place: Noida || |
|Date: July 30 2019 || |