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Expleo Solutions Ltd.

BSE: 533121 Sector: IT
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OPEN 1422.20
52-Week high 1874.00
52-Week low 971.50
P/E 26.42
Mkt Cap.(Rs cr) 1,432
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 1422.20
CLOSE 1411.15
52-Week high 1874.00
52-Week low 971.50
P/E 26.42
Mkt Cap.(Rs cr) 1,432
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Expleo Solutions Ltd. (EXPLEOSOL) - Director Report

Company director report

The Company is pleased to present its business and operations reportfor the year ended March 31 2022.

1. Financial highlights for the year ended March 31 2022:

(Rs. in Millions) (Rs. in Millions)
Consolidated Standalone
March 31 2022 March 31 2021 March 31 2022 March 31 2021
Total Income 4080.71 3063.14 4068.98 3058.30
Employee benefits expense 1948.56 1570.93 1725.03 1265.36
Depreciation and amortization expenses 79.34 58.05 79.24 57.83
General administrative and other expenses 1323.77 739.54 1584.49 1099.52
Finance cost 7.59 10.56 7.59 10.56
Total expenses 3359.26 2379.08 3396.35 2433.27
Profit/(loss) before exceptional items 721.45 684.06 672.63 625.03
Exceptional items





Profit before tax 721.45 684.06 672.63 625.03
Tax expense 182.41 179.65 174.32 172.48
Profit after tax 539.04 504.41 498.31 452.55
Other comprehensive income (5.69) (7.80) (8.22) (5.47)
Total comprehensive income 533.35 496.61 490.09 447.08
Earnings per equity share (par value of Rs.10/- each)
Basic (Rs.) 52.58 49.20 48.60 44.14
Diluted (Rs.) 52.58 49.20 48.60 44.14

2. Business and Operations Review:

Total operating revenue was Rs. 4045.10 Millions for the FinancialYear 2021-22 which increased by 34% over the previous year's Rs. 3008.94 Millions.Total Comprehensive Income stood at Rs. 490.09 Millions (12% of Total Income) againstprevious year's Rs. 447.08 Millions (15% of Total Income). This signifies animprovement in absolute and percentage terms both.

The Company's revenue from operations was more geographicallydiversified this year with the share from India the Middle East and Asia rising to 44%compared to 38% in the previous year. The Europe business contributed to 53% of theCompany's revenue from operations (vs. 59% in the previous year) while the UScontribution grew to 4% from last year's 3%. The proportion of on-site to offshorerevenue from operation stood at 34%-to-66% compared with 46%-to-54% in the previous year.

During the year under review new client acquisition contributed 7% torevenue from operations. The repeat business from existing clients is 93% of revenue fromoperations compared to 95% in the previous year.

For the financial year 2021-22 the revenue from Group clients was 20%as compared to 21% in the previous financial year. On the practice front the Company saw

48% growth in Card & Payment followed by Insurance that grew by29% and Banking by 18% respectively.

As of March 31 2022 the standalone entity's employee strengthwas 1844 (consolidated entity 1882) compared to 1061 (consolidated entity 1117) in theprevious year. Women employee strength grew to 706 (38%) for the consolidated entity from432 (39%) in the previous year. Attrition stands at 39% from the previous year's 16%.

3. Amalgamation / Merger of Expleo Group Companies in India:

The Members are informed that during the year your Company hadinitiated the process of merger of Expleo India Infosystems Private Limited (EIIPL)Expleo Technologies India Private Limited (ETIPL) Expleo Engineering India PrivateLimited (EEIPL) and Silver Software Development Centre Private Limited (SSDCPL) withExpleo Solutions Limited (ESL) through a composite Scheme of Amalgamation pursuant toSections 230 to 232 of the Companies Act 2013. The Companies involved in merger had fileda petition before Hon'ble National Company Law Board Tribunal (NCLT) in ChennaiBengaluru and Mumbai.

Based on the Petitions filed before NCLT the Bengaluru Bench haddispensed with holding of Shareholders Meeting and ordered for holding Unsecured CreditorsMeeting on June 10 2022 for ETIPL EEIPL and SSDCPL. The Creditors Meeting for theseCompanies were held on June 10 2022 and the respective Chairperson appointed had filedtheir report before NCLT.

Also NCLT Chennai had ordered for holding the Shareholders Meetingand Creditors Meeting on August 2 2022 on the petition filed by your Company.

4. Purchase of Specific Assets from Lucid Technologies and SolutionsPrivate Limited and Lucid Technologies and Solutions LLC (Lucid):

During the year the Company had approved the definitive agreementstowards purchase of their specific assets i.e. Intellectual Property and TechnicalKnow-how in India and Customer Contracts in US. Subsequently the definitive agreementswere executed effective April 1 2022.

5. Capital Expenditure:

During the financial year 2021-22 the Company addedRs.270.24Millionstoitsgrossblockwith capital expenditure which comprised Rs. 142.87Millions on building & lease Rs. 112.11 Millions on technology infrastructure Rs.12.29 Millions on physical infrastructure and the balance Rs. 2.97 Millions on intangibleasset addition.

6. Liquidity:

The Company continues to maintain comfortable cash balances to meet itsstrategic objectives. The liquid assets stood at Rs. 1163.63 Millions at the end of theyear against Rs. 1003.66 Millions in the previous year. The Company's cash balanceincreased to Rs. 1197.48 Millions from previous year's Rs. 1011.46 Millions.

7. Share Capital:

At the end of the current financial year the Company's paid-upEquity Share Capital stood at Rs. 102.52 Millions consisting of 10252485 fully paid-upequity shares of Rs. 10/- each.

8. Net worth:

As of March 31 2022 the Company's net worth stood at Rs.2089.69 Millions against Rs. 1599.60 Millions at the end of the previous financial year.

9. Dividend:

The Company has not declared or recommended any dividend during theFinancial Year 2021-22.

10. Subsidiaries and Branches:

The Company operates internationally through four wholly-ownedsubsidiaries:

a) Expleo Solutions Pte. Ltd. Singapore

b) Expleo Solutions UK Ltd. UK

c) Expleo Solutions Inc. USA

d) Expleo Solutions FZE UAE

The Company's Board of directors reviewed the affairs of thewholly-owned subsidiaries for the financial year 2021-22. In accordance with Section129(3) of the Companies Act 2013 the Company has prepared its Consolidated FinancialStatements which form a part of this Annual Report. A separate section on the salientfeatures performance and financial position of each of the subsidiaries can be found inAnnexure-I. It includes their contribution to the overall performance of the Company.

During the period under report as per Section 129(3) of the CompaniesAct 2013 read with Rule 5 and Rule 8(1) of the Companies (Accounts) Rules 2014 theSubsidiaries audited annual financial statements and related information whereverapplicable will be made available to shareholders upon request and will also be availablefor inspection during regular business hours at the registered office of the Company. Theaudited annual financial statements shall also be available on the website of the Company.The Company has branch offices in the Philippines Belgium and Malaysia. During the yearthe Company has opened a new Branch Office in Coimbatore India and the operations havecommenced.

11. Annual Return:

The Annual Return in Form MGT-7 for the financial year ended March 312022 as prescribed under Section 92(3) and Section 134(3)(a) of the Companies Act 2013read with Rule 12 of Companies (Management and Administration) Rules 2014 as amended isdisclosed on the website of the Company - AGM and Annual Report.

12. Number of Meetings of the Board:

The Board met six times during the financial year ended March 31 2022.The said meetings were held on May 20 2021 July 09 2021 August 12 2021 November 102021 February 03 2022 and March 25 2022.

The Corporate Governance Report has details of these meetings. Theintervening gap between the meetings was within the period prescribed under the CompaniesAct 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 as amended.

13. Corporate Governance and Management Discussion and Analysis Report:

A separate section on Corporate Governance which is a part of theBoard's Report and the certificate from the Company's Auditors confirmingcompliance with Corporate Governance norms as stipulated in the SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 as amended are included in the AnnualReport. The Company has taken adequate steps for strict compliance with CorporateGovernance guidelines as amended from time to time. A separate Management Discussion andAnalysis Report is also attached and forms part of this report.

14. Business Responsibility Report:

A separate section on Business Responsibility Report also forms a partof this report.

15. Declaration given by Independent Directors:

All the Independent Directors of the Company have given theirdeclaration under Section 149(7) of the Companies Act 2013 confirming that comply withthe criteria of independence as laid down in Section 149(6) of the Companies Act 2013and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 as amended for being an Independent Director of the Company.

16. Policy on Directors' appointment and remuneration:

The Company has a policy in place on Directors' appointment andremuneration including criteria for determining qualification positive attributesindependence of a Director and other matters as required under Section 178(3) of theCompanies Act 2013 and Regulation 19 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended. There has been no change in this policy sincethe last financial year. The Corporate Governance Report covers the details disclosed onthe Company website

17. Particulars of loans guarantees or investments:

The Company has not given any loan to any person given any guaranteeor provided security to any other body corporate or person in connection with a loan. Ithas not acquired through subscription purchase or otherwise the securities of any otherbody or corporate. The Company has the following investments in its wholly-ownedsubsidiaries as specified under Section 186 of the Companies Act 2013:

Rs. in Millions

Particulars March 31 2022 March 31 2021
Unquoted equity instruments (in subsidiaries)
100000 equity shares (Previous year - 100000 equity shares) of SGD 1/- each in Expleo Solutions Pte. Ltd. Singapore 2.66 2.66
3000 equity shares (Previous year - 3000 equity shares) of USD 0.01/- each in Expleo Solutions Inc. USA 4.62 4.62
350000 equity shares (Previous year - 350000 equity shares) of GBP 1/- each in Expleo Solutions UK Ltd. UK 24.17 24.17
600 equity shares (Previous year - 600 equity shares) of AED 1000/- each in Expleo Solutions FZE. UAE 8.70 8.70

18. Particulars of contracts or arrangements with related parties:

During 2021-22 all the contracts and arrangements entered by theCompany with related parties were on an arms-length basis and in the ordinary course ofbusiness. The total value of all the transactions with M/s. Expleo Group and itssubsidiaries are above the threshold limit of 10% of the last audited consolidatedturnover of the Company. These transactions have been classified as "Material RelatedParty Transactions" as per SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 as amended. However the aforesaid transactions fall within limitsapproved by the shareholders in the Annual General Meeting held on August 26 2021. Thereare no materially significant related party transactions made by the Company withDirectors key management personnel senior management personnel or other designatedpersons which may have a potential conflict with the Company's interests at large.All related party transactions are placed before the Audit Committee and the Board ofDirectors for their prior approval.

For foreseen and repetitive transactions with the wholly-ownedsubsidiaries a prior omnibus approval of the Audit Committee is obtained annually. Thetransactions entered pursuant to the omnibus approval so granted are tracked and verified.A statement giving details of all related party transactions is placed before the AuditCommittee and the Board of Directors for their approval every quarter. The policy onMateriality of Related Party Transactions as approved by the Board of Directors isavailable on the Company's website

None of the Directors have any pecuniary relationship(s) ortransaction(s) vis-a-vis the Company. The details of contracts or arrangements withrelated parties entered during the year are given in Annexure-II of the report.

19. Material changes and commitments if any affecting the financialposition of the Company:

No material changes or commitments affecting the financial position ofthe Company have occurred between the end of the financial year to which theCompany's financial statements relate and the date of the report.

20. Transfer to Investor Education and Protection Fund("IEPF" ):

In accordance with the applicable provisions of the Companies Act2013 read with the IEPF Authority (Accounting Audit Transfer and Refund) Rules 2016(the Rules) all unpaid or unclaimed dividends are required to be transferred by theCompany to the IEPF established by the Government of India after the completion of sevenyears. Further according to the Rules the shares on which a dividend has not been paidor claimed by the shareholders for seven consecutive years or more shall also betransferred to the Demat account of the IEPF Authority. During the financial year 2021-22an amount of Rs. 195756/- which was lying in the Final Dividend account pertaining tothe year 2013-14 and an amount of Rs. 147984/- lying in the Interim Dividend accountpertaining to the year 2014-15 of the Company was transferred to the IEPF on completion ofseven years. Pursuant to provisions of Rule (6) of the Investor Education and ProtectionFund Authority (Accounting Audit Transfer and Refund) Rules 2016 as amended from timeto time wherein the seven-year period provided under subsection (5) of Section 124 iscompleted for unpaid/unclaimed dividends during 2021-22 the Company had transferred 550Equity Shares to the credit of IEPF Authority in respect of shareholders who have notclaimed their dividend for a consecutive period of seven years. Members who have so farnot encashed their dividend warrant(s) or those yet to claim their dividend amounts maywrite to the Company Secretary & Compliance Officer / Company's Registrar andShare Transfer Agent (Cameo Corporate Services Limited). The details of shareholders whoseshares were transferred to the IEPF Authority are available on - Transferred to IEPF.

21. Conservation of energy research and development technologyabsorption foreign exchange earnings and outgo:

(A) Conservation of energy:

(i) Steps that impact energy conservation: The Company has alwaysactively promoted eco-friendly and green initiatives. It continues to work on reducing itscarbon footprint conserving energy and using energy generated from alternative sourceswherever possible. It continues to deploy adequate measures to conserve energy by usingless power-consuming USFF-based computers and deploying LEDs for perimeter lighting in theMEPZ premise. The Company is also in the process of optimizing lighting equipment for anoverall reduction of light bulbs used and conversion to LED bulbs. The adoption ofVRF-based air conditioning and sensor-based lighting in all cabins and meeting rooms hassignificantly reduced electricity consumption and the Company's carbon footprint.

(ii) Steps taken to utilize alternative energy sources: TheCompany's registered office is in a tech park where close to 80% of energy is sourcedfrom the grid powered by wind turbines promoting green energy.

(iii) Capital investment on energy conservation equipment: Nil

(B) Research & development and technology absorption:

(i) As a result of consistent focus on R&D and latest technologiesthe company has grown significantly since last year. Our footprint in digital anddevelopment have increased tremendously to 500+ developers in India. We are now seen as adecent SI providing development services for fintech companies. We are developing latesttechnology trends such as Digital Twins SuperApps and Chatbots for our customers.

(ii) The Company's focus on data science has won us a digitalpayments customer in Government of India. We are now officially taking up data scienceprojects for them and serving them successfully.

(iii) Understanding the cruciality of data analytics the company hasacquired a data analytics company called Lucid that focuses on Governance Risk andCompliance (GRC). Lucid brings around USD 2.8M business to the table and a list of fortune500 customers who are happy with it.

(iv) The company focuses on Digital Twin Model-based Testing solutionswith tools such as Signavio Modell and Enterprise Architect. Expleo has successfullycompleted PoC on model-based testing.

(v) The company is making progress in proving the concept of HyperAutomation or automation of automation. The company has successfully developed a PoC for areal-time operating system provider and has automated the C language test code generationusing python.

(vi) The company has developed a very good solution called QubEHyperScript for smart performance testing. This will help to demystify and industrializeperformance testing and reduce the high skill dependency on performance testing.

(vii) The company has successfully delivered its AI/ML PoC onpredicting mean time between failures (MTBF) in IT infrastructure (servers and appliances)for a leading blue-chip company in the US.

(viii) The company is focusing on sustainable computing and reducingcarbon footprint. The company is investing in low power high efficiency systems to helpsave the environment.

(ix) The procurement system continuously ensures cost-effectivehardware purchases more through local vendors thereby reducing import dependency. Whererequired the Company also imports servers switches and other hardware products usingforeign currency from its Exchange Earners' Foreign Currency (EEFC) accounts.

(x) There has been no import of technology during the last threefinancial years.

(C) Foreign exchange earnings and outgo:

Foreign exchange earned during the year in terms of actual inflows wasRs.2916.60 (Previous year - Rs. 1964.69 Millions) whereas foreign exchange outgo duringthe year in terms of actual outflows was Rs.1416.57 (Previous year - Rs. 643.02 Millions).

The current year's inflows and outflows are regarding the movementof funds into and outside India in foreign currency.

22. Risk management:

The Company is committed to effectively managing its operationalfinancial and other risks to achieve a balance between acceptable levels of risk andreward. The Company has formulated an Enterprise Risk Management Policy (ERM) incompliance with Regulations of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 ("the Listing Regulations") and provisions of the CompaniesAct 2013 ("the Act") which requires the Company to lay down procedures aboutrisk assessment and risk minimization.

The scope of the ERM Policy covers risks across all levels of theorganization considering the internal and external context. The Enterprise RiskManagement of the Company includes:

• Risk Management framework which comprises of:

a) Identifying and assessing a broad array of internal and externalrisks that could adversely impact the achievement of organizational goals and objectivesin a structured manner.

b) Ensuring appropriate ownership and accountability of risks.

c) Developing and implementing appropriate risk mitigation andmonitoring plans by risk owners including systems and processes for internal control ofidentified risks and business continuity plans.

• Establishing a program structure that engages functional leadersacross to identify and prioritize risks consistent with the Risk tolerances.

• Providing senior leadership / Board with key timely informationto make risk-informed decisions.

• Providing reasonable assurance with respect toorganization's ability to achieve its strategic and business objectives.

The key categories of risks identified are:

• Strategic: Any risk that impacts the company's strategy andmakes it less/ineffective; could be technology changes new competitor change in customerdemand etc.

• Financial: Risks relating specifically to the money flowing inand out of business and the possibility of a sudden financial loss.

• Operational: Risks that could facilitate or hinder theefficiency and effectiveness of core operations within the organization.

• Compliance: Risks relating to non - adherence of any applicablelegal requirements statutory adherence certification requirements customer requirementsetc.

Risk Management in the Company includes identification assessingmonitoring and mitigating various risks through a process that comprehensively evolvedover the years.

The ERM of the Company comprises of a series of processes structuresand guidelines that assist in identifying assessing monitoring and managing its businessrisk including any material changes to its risk profile. To achieve this the Company hasclearly defined the responsibility and authority of Board of Directors to oversee andmanage the risk management program while conferring responsibility and authority onsenior management to develop and maintain the risk management program in light of theday-to-day needs of the Company.

Regular communication and the review of risk management practiceprovides the Company with important checks and balances to ensure the efficacy of its riskmanagement program. Risk Management Committees are established consisting of seniormembers of the Company for periodical monitoring and review of the various categories ofrisks.

The Risk Assessment Process is monitored and controlled in differentways. This includes:

• Quarterly internal audits by an independent firm;

• Regular process compliance audits for ISO 9001 and ISO 27001standards including SOC audits;

• Periodic audits of compliance to other regulatory frameworks;

• Monitoring and tracking of compliance of applicable laws for theCompany using Compliance tool which is updated on real time basis with latest amendments;

• Annual capital and revenue budget planning followed by monthlyreviews;

• Annual sales planning with monthly/periodic monitoring;

• Annual perspective and strategic planning exercise with a yearlyupdate;

• A conservative approach in planning funding requirements.

Over the last few years the Company has developed comprehensiveinternal financial control processes and procedures that could effectively mitigate theoverall organizational risks.

23. Adequacy of internal financial controls:

The Company has a proper and adequate internal control system. Thisensures that all transactions are authorized recorded and reported correctly and assetsare safeguarded and protected against loss from unauthorized use or disposition. Inaddition there are operational controls and fraud risk controls covering the entirespectrum of Internal Financial Controls.

An extensive programme of internal audits and management reviewssupplement the process of the Internal Financial Control framework. Properly documentedpolicies guidelines and procedures have been laid down for this purpose. The InternalFinancial Control framework has been designed to ensure that the financial and otherrecords are reliable for preparing financial and other statements and maintaining assetaccountability. In addition the Company has identified and documented the risks andcontrols for each process that links to financial operations and reporting.

The Company also has an Audit Committee comprising three Directorswho interact with statutory auditors internal auditors and management to deal withmatters within its terms of reference. This Committee mainly deals with issues ofaccounting financial reporting and internal control. The framework for the InternalFinancial Controls was made by:

• Defining controls governance and standards including policiesand procedures organizational structures and performance objectives;

• Establishing control designs including roles andresponsibilities risk identification and capacity to deliver business objectives;

• Evolving controls including control systems and improvements;

• Compliance and control monitoring through internal resources oraudit or a combination of both.

The internal audit team along with the process team monitors andevaluates the efficacy and adequacy of internal control systems in the Company itscompliance with operating systems accounting procedures and policies. Based on theinternal audit report corrective actions if any are undertaken and controlsstrengthened in the respective areas. Significant audit observations andresponses/corrective actions if any are presented to the Audit Committee of the Board.During the year an Internal Financial Control (IFC) audit concerning financial statementswas done by the Statutory Auditors. Their report is annexed as part of the IndependentAuditor's Report.

24. Corporate social responsibility:

Expleo's Corporate Social Responsibility (CSR) vision is to be acompany committed to addressing major social issues of the time. The Company'sapproach reflects its principles and values and has ambitious targets that are meaningfuland create value for all stakeholders.

Through its CSR initiatives the Company focuses on promoting educationfor the differently abled under privileged and protecting the environment.

The Company's CSR activity during the year was all about followingits core purpose and philosophy. It also included relief measures to fight Covid-19 whichwas the need of the hour.

Expleo continued to support children with special needs. The programmemade learning possible and managed to keep children and parents positively motivated andengaged throughout the year.

In support of the fight against Covid-19 the Company contributed tothe Tamil Nadu State Disaster Relief Fund and to the Maharashtra State Disaster ManagementAuthority for the Covid relief. The Company also contributed towards promoting a clean andgreen environment.

Key highlights of the CSR activities undertaken by Expleo:


a) Vidya Sagar: Education for differently-abled children

- The Company contributed for supporting special education for highschool which works with children of school going age 15 and above with disability. Theyconduct online classes as

per the guidelines in their Standard Operating Procedure (SOP) andensured to adhere to the government guidelines for schools in general. Physical classeswere also conducted based on the scenario.

- The Company had contributed to the salary of therapist and specialeducation trainer to the high school students of Vidya Sagar.

- The therapist was responsible for physiotherapy speech alternativeand augmentative communication training occupation therapy procurement and optimalutilization of furniture mobility and orthotic aids. Additionally the students werealso imparted with functional and life skills enabling them to explore vocations.

- This project shall help youth gain employment and fill the supportgap faced by the differently abled students.

b) Agastya: Education for the underprivileged

- The Company sponsored the "Lab on Bike" projectcontributing to organizing hands- on science sessions and multimedia sessions to identify20 to 28 schools in Powai and Navi Mumbai.

- The programme objective is to help to catalyze local schools andeducators and shall improve the quality of education for rural/municipal children andteachers.

- It increased the access to practical hands-on science education forunder privileged children. The project included significant improvement in the classroomlearning environment provided better and more productive interaction and hands-onlearning opportunities with improved overall learning and understanding of concepts.

- All the beneficiaries under this project were economicallydisadvantaged and were students and teachers at government schools.

c) e-Vidyaloka: Digital classrooms

- The digital classroom project was transformed to "Learn fromHome" Project. Expleo sponsored tablets smartphones Bluetooth speaker and bookswhich helped in scholastic reinforcement along with emphasis on wellbeing and health ofthe school students in rural areas.

- e-Vidyaloka organized a training programme for all the field teamsacross all states for providing training and reinforcement on skill and to help andsustain the children education and related interventions. The session to orient volunteerteachers about Learn From Home (LFH) were conducted.

- e-Vidyaloka focused on ready-to-consu me content which includesvideo lessons and worksheets. They helped in assisting the content-driven mode ofeducating children - both during the lockdown and after-school intervention. They proposedto engage and utilize the video through their app and have announce that they have arepository of 5000 videos that can be utilized to enable learning (self or assisted).

d) Contribution to SankalpTaru

- Expleo maintains the 900 trees planted at Mamallapuram as part of thecommunity-based plantation programme conducted last year.

e) Aram Foundation: School Sports Infrastructure Project

- Expleo had contributed to the Sports Infrastructure and coaching atGovernment Girls Higher Secondary School Chinna Thadagam Coimbatore which was estimatedto benefit around 500 girls in the school. The infrastructure shall also be used by othergovernment schools in the vicinity.

- The Project had provided 2 volleyball courts a basketball court aKabbadi ground cricket nets along with sports equipment renovation of storeroom watertank and toilets.

f) Diya Ghar: Education for the children of migrant laborers

- Diya Ghar is an NGO with a heart for the migrant community. Itstarted with a vision for all children irrespective of their economic status to haveaccess to stimulating and nurturing pre-school education. The NGO started communitycenters with a focus to provide early childhood education nutrition health andchildcare for the children.

- It has proposed for the project called "community- basedmodel" program wherein new portable and prefabricated community centers areestablished towards education for the children of migrant laborers and to provideeducation for the said children. Expleo had contributed for the said project.

- The project included identification and training community teachersconducting classes using Montessori Method prepares students and their families to enrolltheir children in Primary Schools.


g) Contribution to Siruthuli NGO

• Expleo had provided contribution to the Afforestation

Project "Kalam Vanam - journey into the world of green" ofSiruthuli in the Coimbatore city with their vision of planting 1 sapling per citizen thusrestoring the green cover to the region and increasing the lung spaces. Expleo had planted5000 trees in the Anna University Campus at Coimbatore and the NGO has taken theresponsibility of maintenance of the trees and has agreed to replace the sapling that donot survive.

Details of the policy developed and implemented by the Company as partof its CSR programme and other initiatives taken during the year are given in Annexure IIIas required under Section 135 of Companies Act 2013 read with Companies (Corporate SocialResponsibility Policy) Rules 2014 as amended.

25. Composition and recommendation of the audit committee:

The Audit Committee of the Company has been constituted in line withSection 177 of the Companies Act 2013 read with Regulation 18 of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. The members of the AuditCommittee are:

1) Prof. K. Kumar Chairman

2) Prof. S. Rajagopalan Member

3) Mr. Rajiv Kuchhal Member

During the year the Board accepted all recommendations of the AuditCommittee.

26. Vigil mechanism:

The Company has formulated and adopted a vigil mechanism for employeesto report genuinely unethical and improper practices or any other wrongful conduct to theAudit Committee Chairman. The policy provides opportunities for employees to access theAudit Committee in good faith if they observe unethical and improper practices. TheWhistle Blower Policy of the Company is available on

27. Directors' responsibility statement as required under Section134(5) of the Companies Act 2013:

Under Section 134 (5) of the Companies Act 2013 the Directors confirmthat:

a) For the preparation of the annual Financial Statements theapplicable accounting standards were followed accompanied by a proper explanationrelating to material departures;

b) Accounting policies were selected and applied consistently; fairjudgment was used and prudent estimates made to give an accurate view of theCompany's state of affairs at the end of the financial year and it's profit andloss for that period;

c) Proper and sufficient care was taken for maintaining adequateaccounting records as per provisions of this Act to safeguard the Company's assets toprevent and detect fraud and other irregularities;

d) Annual Financial Statements were prepared on a going concern basis;

e) The Company laid down Internal Financial Controls and that suchinternal financial controls are adequate and these were operating effectively; and

f) Proper systems were devised to ensure compliance with all applicablelaws and such systems were adequate and operating effectively.

28. Board evaluation:

Under the provisions of the Companies Act 2013 and SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 as amended the Board ofDirectors of the Company in their meeting held on May 18 2022 evaluated itsperformance that of its committees and Individual Directors including IndependentDirectors. No Director participated in his/her evaluation. The Independent Directorsreviewed the Non-Independent Directors Chairman and the Board at a separate meeting ofIndependent Directors held on February 2 2022. The Board of Directors was evaluated onvarious criteria including attendance participation in Board meetings involvement byproviding advice guidance suggestions on the business front and the willingness andcommitment to devote the time necessary to fulfil his/her duties.

The Independent Directors were also evaluated based on the performanceprofessional conduct roles and duties as specified in Schedule IV of the Companies Act2013 and based on the fulfilment of the Independent Director criteria as specified inRegulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.The Board evaluation was based on composition and statutory compliance understandingbusiness risks adherence to process and procedures overseeing management procedures forenforcing code of conduct ensuring various policies including the Whistle Blower Policywere in force. The Board of Directors is of the opinion that the Independent

Directors possess integrity expertise and experience includingproficiency.

29. Criteria for making payment to Non-Executive Directors:

The Nomination and Remuneration Committee and the Board of Directorsconsidered the following criteria while deciding on the payments to be made toNon-Executive Directors:

• Company performance.

• Maintaining independence and adhering to Corporate Governancelaws.

• Contributions during meetings and guidance to the Board onimportant Company policy matters.

• Active participation in strategic decision-making and informalinteraction with the management.

30. Familiarization programme:

The Company has a familiarization programme for Independent Directorsunder Regulation 25(7) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 as amended. It aims to provide Independent Directors Company insight toenable understanding of the business in depth and contribute significantly to the Company.Overview and details of the programme for Independent Directors have been updated on

31. Policy for determining material subsidiaries:

Pursuant to Regulation 16(1)(c) of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 as amended a policy for determining materialsubsidiaries was formulated. The same is updated on the Company's website at content/uploads/2022/07/Policy-for-Determininq-Material-Subsidiaries.pdf and is dealt with elsewhere in the Annual Report.

32. Particulars of employees:

In accordance with the provisions of Section 197 of the Companies Act2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 as amended a statement containing the names of top 10 employeesin terms of remuneration drawn during the financial year and that of every employeeemployed throughout the financial year and in receipt of a remuneration of Rs. 1.02 croreor more per annum or employed for part of the financial year and receipt of Rs. 8.50 lakhper month is annexed and forms a part of this Report in Annexure-IV(A) and the ratio ofremuneration of each Director to that of median employees' remuneration as perSection 197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 as amended is part ofthis Report in Annexure-IV(B).

33. Directors and key management personnel:

Mr. Rajesh Krishnamurthy (DIN - 08288884) who was appointed as anAdditional Director (Non-Executive) of the Company with effect from September 1 2020 hasbeen appointed as Non-Executive Director of the Company by the Shareholders at the AnnualGeneral Meeting held on August 26 2021.

Mr. Prashant Eknath Brahmankar (DIN - 07439819) has been appointed asAdditional Director (Non-Executive) of the Company with effect from September 1 2021 bythe Board of Directors and he shall hold office up to the date of the ensuing AnnualGeneral Meeting.

34. Public deposits:

The Company has not accepted or renewed any public deposits and assuch no amount of principal or interest was outstanding on the Balance Sheet as of date.

35. Statutory Auditors:

M/s. Kalyaniwalla & Mistry LLP Chartered Accountants are theStatutory Auditors of the Company. They were appointed in the 19th Annual General Meetingand will hold office till the 24th Annual General Meeting of the Company.

Pursuant to the provisions ofSection 139 of the Companies Act 2013read with The Companies (Audit and Auditors) Rules 2014 and based on the recommendationsmade by the Members of Audit Committee the Board of Directors at their meeting held onJune 17 2022 considered and recommended to the Members of the Company for theirapproval the appointment of M/s. Kalyaniwalla & Mistry LLP Chartered AccountantsMumbai as the Statutory Auditors of the Company from the conclusion of 24th AnnualGeneral Meeting till the conclusion of 29th Annual General Meeting of the Company.

The report issued by the Auditors to the members for the financial yearended March 31 2022 does not contain any qualification reservation or adverse remarkor disclaimer. Auditors reported no frauds under sub-section (12) of Section 143.

36. Maintenance of cost records:

The maintenance of cost records as specified by the Central Governmentunder Sub-Section (1) of Section 148 of the Companies Act 2013 does not apply to theCompany.

37. Secretarial audit report:

Pursuant to Section 204 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Companyappointed M/s. M. Alagar & Associates (practicing company secretaries COP No. 8196)as the Secretarial Auditor of the Company in the Board Meeting held on May 20 2021 forthe financial year 2021-22. The Secretarial Audit Report issued by M/s. M. Alagar &Associates is annexed and forms a part of this Report in Annexure-V. The Secretarial AuditReport does not contain any reservation or adverse remark for the year under review.Further the Company complies with the mandatory Secretarial Standards issued by theInstitute of Company Secretaries of India (ICSI) and notified by the Ministry of CorporateAffairs (MCA).

38. Significant and material orders passed by the regulators courts ortribunals:

There are no significant and material orders passed by the regulatorsor courts or tribunals that may impact the Company as a going concern and/orCompany's operations.

39. Human potential:

The Company emphasizes the importance of helping its people achievetheir maximum potential in all aspects of their functioning. The Company maintains astrong learning culture and provides a wide range of opportunities for employees to learndevelop and progress in their careers.

Great Place to Work (GPTW) :

The Great Place to Work survey (called the ‘Trust Index') isone of the most widely used employee surveys in the World which acts as a trusted thirdparty providing proven methodology and best practice to help companies create realisticplans to improve their workplace.

Overall the survey results enabled us to have a more accurate pictureof how our employees feel about working in your Company by providing us with detailedinformation as to their opinion about our performance culture relationships how we goabout in our work and where we are heading for thus helping us to explore areas ofopportunity to set Expleo on the path towards creating an organizational culture where wedrive excellence with empathy.

Key highlights of 2020 survey results :

• GPTW score for 2021 is 75% (+3 from 2020)

• 79% of employees believe that Expleo is a great place to work(+2% from 2020)

• 73% of employees believe that Expleo will act on the surveyresults (+3% from 2020)

• 83% of employees are proud to tell others that they work withExpleo (+3% from 2020)

The programs conducted under various learning categories are mentionedbelow:

Technology: The Company majorly focuses on technical skills such asJava Performance Engineering Appium Security Structured Query Language and Python.

Domain and Domain products: The Company conducted Guidewire FinAstraBanking payments Cards Treasury and Capital Markets Insurance and other domain relatedtrainings.

Testing: The Company conducted programs such as Extract Transform Load(ETL) Testing Test Automation Test Methodology and Security Testing.

Tools: Programs on Selenium Robotic Process

Automation Topology and Orchestration Specification for CloudApplications (TOSCA) and Jira bug tracking tool were conducted to sharpen employeeknowledge on latest tools.

Process Methodologies: The Company conducted programs such as Agile /Scrum Accelerated Agile Kanban and Agile Design Thinking.

Leadership skills: To enhance leadership skills we offered ManagementDevelopment Program Customer Relationship Management and Strategic Management programs.

Soft Skills: To improve customer experience we conducted trainings onsoft skills such as email etiquette presentation skills listening skills and other suchcompetencies.

Strategic L&D: Our primary responsibilities are to developworkforce capabilities skills and competencies the organization needs to align with keybusiness priorities.

L&D's strategic role spans in five areas listed below:

a) Talent attraction & retention.

b) Developing people capabilities.

c) Motivating & engaging employees.

d) Driving culture of continuous learning.

e) Employer brand creation.

Talent attraction and retention

We are committed to our employee's professional development andprovide appropriate opportunities and career paths. Employees can quickly learn new skillsto keep up with rapidly changing roles and project requirements.

Here are our key initiatives to attract and retain talent:

a) Graduate Training Program (HTD)

b) Certification Reimbursement Policy

c) Individual Development Plan (IDP)

d) SSB - Special Skill Bonus

e) Self-Learning Enablement

f) Expert Connect Sessions

g) Role Based Learning

Developing people capabilities

We are committed to developing next-generation leaders. To achievethis we have created focused leadership development programmes at various levels.

Here are our key programmes for leadership development:

a) Leadership Enhancement Action Programme (LEAP).

b) Bullet-Proof Management Programme (BPM).

c) Onsite Associates Programme.

d) English language Training and Proactive Thinking

e) BA2BC - Business Analyst to Business Consulting

Motivating and engaging employees

Expleo is committed to providing opportunities so employees can learnand develop new competencies. We conduct various initiatives to motivate and engage ouremployees. Our L&D recognizes and reward individual learning accomplishments.

Here are our key programmes for motivating and engaging employees:

a) NJOP (New Joiner Orientation Programme).

b) QA-QE Transformation.

c) Technical & Domain Upskilling.

d) Training for On-site employees.

e) Quizzard.

f) Speed Learning.

g) TGIF (Thank God It's Friday).

h) Reader's Loft.

i) Management Development Programme.

j) R&R for Trainers.

k) Digital Badges - Rewards for Learning & CertificationAccomplishments.

Driving culture of continuous learning

Expleo L&D provides a culture of continuous learning for employeesat all stages of their careers to upskill and reskill continuously and on-demand. Tosupport upskilling of our employees we have set up the Technology Lab which ourassociates can access remotely to get hands-on experience.

Here are our key programmes through which we drive a culture ofcontinuous learning:

a) Self-Learning Enablement - Coursera Learning platform - 179%Utilization

b) Technology Lab for Hands-On practice

c) Speed Learning.

d) Expert Connect Session.

e) Knowledge Sharing Sessions.

f) Virtual Classrooms.

g) MOOCs (Massive Open Online Courses).

h) Learning Assessment & Measurement Platforms - IKM SurveyMonkey

Employer Brand Creation

Expleo's commitment and investment towards learning have enhancedits brand position as an employer of choice. The Company provides promised opportunitiesfor professional development and career growth. L&D builds required workplacebehaviours including knowledge and skills necessary to deliver customer satisfaction andthe management and leadership expertise essential to create and sustain the workingconditions promised as employee experience. L&D also plays a crucial role inreinforcing the identity & values of the Expleo culture.

Here are our key programmes that build employer brand:

a) Diversity and Inclusion (D&I) - OORJAA


b) QA-QE Transformation.

c) Leader's Framework - ETC Leader Programme - Digital Skills.

d) Leadership Development Program.

e) Digital Badges for Publishing in Social Channels - Rewards forLearning Accomplishments.

f) Succession Planning.

Key Achievements

• Bullet-Proof Management Programme (BPM): 24 employees from GG4.1to GG4.3 got certified from 2021 to 2022; 7-month-long training programme.

• Leadership Enhancement Action Programme (LEAP): Completed 4batches covering 100 employees from Grades GG3.2 to GG4.1; 3-month training programme.

• Tech Up-Skilling Phase :

HC:645 & 75% of Target Completion in 2 Certifications (Group 1& Group 2). Which Means at least 484 to complete both the certifications by end of2021.

Group 1 Completion - 622 (96%)

Group 2 Completion - 526 (82%)

In 2022: The Technical Upskilling will be through Coursera and includedin the One India Initiative.

• Learning Metrics Achieved:

o Total learning hours - 81912 (April 2021 to March 2022)

o Average learning hours per employee - 47.84 hours (against a 40-hourtarget)

o Self-learning hours - 57792 hours (70% of total hours)

o Unique no. of associates trained (headcount active) - 924

• Expert Connect Sessions: 8+ sessions published 400+ attended.

• Knowledge Sharing Sessions: 8+ sessions covering 400+ employees.

• Domain Upskilling: 60 out of 81 employees (74%) who registeredcompleted the programme against nominations; 28 in progress.

• Digital Badges for Learning and Certification:

Accomplishments under various Learning & Certification initiativeslike BPM (36) LEAP (150) QA-QE Transformation (600+) Trainers Completing 40 hours ofLearning (800+) Technical & Domain Upskilling (600+) etc.

• Quizzard: Published 200+ Questions 300+


• 2022 - January to March - Key Programmes:

o Coursera Learning platform - Technical Upskilling

- 200 Licenses procured which will be rotated across Expleo IndiaEmployees

o D&I - Oorjaa Training - UI/UX - 4 & Data Analytics

- 4 Trainees onboarded

o BA2BC program Batch 2 completed - 25 Trained/ Certified

o Oracle Retail Training - 25 Participants

o WRS - Winning Relationship Selling - 16 Participants

o LEAP Batch 7 & 8 Completed - 45 participants

o Advanced Excel Training - 15 Participants

40. Quality technology and systems:

The Company has established a Compliance Framework that follows aphased approach. It starts with establishing legal contractual and security requirementsto be complied with internal communication and creating awareness on these requirementsintegration of requirements with existing security and process framework for ongoingcompliance monitoring and audit for ensuring compliance periodic assessment of thematuring level of compliance processes and reporting and improvement of the securityframework. The compliance framework is independently assessed and certified by externalcertification bodies on an annual basis. Independent assessment are done as part of ISO9001 ISO 27001 PCI DSS and SSAE 18/ISAE3402 certifications.

ISO 9001: 2015 (Quality Management System)

All offshore testing centers of the Company are certified for QualityManagement System (ISO 9001:2015).

The Company has adopted quality management system to improve itsoverall performance and provide a sound basis for sustainable development activities. TheCompany promotes adopting a process approach when developing implementing and improvingthe effectiveness of a quality management system to enhance customer satisfaction bymeeting customer requirements. This enables the Company to plan its processes and theirinteractions. This also enables the Company to ensure that its processes are adequatelyresourced and managed and opportunities for improvement are determined and acted on. TheCompany also implemented Risk-based thinking which enables to determine the factors thatcould cause the processes and its quality management system to deviate from the plannedresults put in place preventive controls to minimize negative impacts and to make maximumuse of opportunities as they arise. The process approach involves the systematicdefinition and management of processes and their interactions to achieve the intendedresults by following the top management's quality policy and strategic direction. TheCompany adopts various forms of improvement and correction and continual improvementssuch as breakthrough change innovation and reorganization.

ISO 27001:2013 (Information Security Management System)

All offshore testing centers of the Company are certified forInformation Security Management System (ISO 27001: 2013).

The Company achieves information security by implementing a suitableset of controls including policies processes procedures organizational structures andsoftware and hardware functions. These controls are established implemented monitoredreviewed and improved to meet the organization's specific security and businessobjectives.

The Company has adopted ISO 27001 an international standard forestablishing implementing maintaining and continually improving an information securitymanagement system. The adoption of an information security management system is astrategic decision for an organization. Its establishment and implementation areinfluenced by the organization's needs and objectives security requirementsprocesses used and the size and structure. The information security management systemhelps the Company to identify and address the threats and opportunities around Companyinformation and related assets. This helps to protect the Company from security breachesand shields from any disruption if and when they happen.

The information security management system in the Company preserves theconfidentiality integrity and availability ofinformation by applying a risk managementprocess and gives confidence to interested parties. The information security managementsystem helps the

Company's business in many ways - Safeguarding the Company'sinformation assets demonstrate to external stakeholders how secure the Companyinformation is stay ahead of new information security risks and opportunities and therebysupporting Company's development and growth.

The information security management system is integrated with theorganization's processes and overall management structure and information securityis considered in the design of processes information systems and controls.

SSAE 18 (Statement on Standards for Attestation Engagements) / ISAE3402 (the International Standard on Assurance Engagements):

The offshore TCoE (Testing Centre of Excellence) of the Company inChennai is compliant with ISAE 3402 (the International Standard on Assurance Engagements)and SSAE 18 (Statement on Standards for Attestation Engagements). SSAE 18/ ISAE 3402 is anindependent assessment report that provides the confidence on control procedures adequacyand reasonable assurance in the Company's service delivery information security anddata privacy-related controls. SSAE 18 is more relevant for the US market while ISAE 3402is relevant for the rest of the World. Outsourcing companies (Expleo clients) are lookingfor third-party assurance to provide their clients (Expleo) with comfort about theirinternal control environment. Replacing SAS 70 ISAE 3402 / SSAE 18 standards remain themost widely employed approach to demonstrate third-party assurance providing coverage tousers of outsourced services.

This report has been prepared to provide information on theCompany's application testing services and related general computer controls for theservices provided to clients. The assessment report illustrates the positive effects of aproperly functioning and articulated control environment on an organization's seniormanagement and clients. The Company has been assessed for the past 8 years by one of theBig 4 audit firms and attestation has been obtained stating that the controls are not onlysuitably designed but also effectively implemented over a period of one year. Theassessment period is for one calendar year and opinion is provided by the Certified PublicAccountant stating that the controls are operating effectively over a period of time.

PCI-DSS (Payment Card Industry Data Security Standard):

Data protection is critical for the Company in maintaining its servicesto clients. The Company is also compliant with PCI-DSS (worldwide data security standarddefined by the Payment Card Industry Security Standards Council) since 2010 ensuring datasecurity and reducing the risk of data breaches. The Company adopted PCI-DSS to meet thecustomer requirements specific to the cards domain. The Company has designed andimplemented technical and operational controls to protect cardholder data.

The Company implemented a minimum set of requirements for protectingcardholder data. It also deployed additional controls and practices to mitigate risksfurther and address local regional and sector laws and regulations. These controls alsoaddress the legislation or regulatory requirements to protect personally identifiableinformation or other data elements.

Compliance to Data Protection Laws:

Data Protection is a significant concern for organizations worldwide.The focus is on secure handling to ensure the protection of customer data as well ascorporate data. The importance of privacy and data protection is increasingly recognizedas more and more social and economic activities become online. When it comes to dataprotection different countries have enacted different set of laws. As technologicaladvances have improved data collection and surveillance capabilities governments aroundthe world have started passing laws regulating what kind of data can be collected aboutusers how that data can be used and how data should be stored and protected.

The European Union (EU) views privacy of personal information as afundamental right. With the introduction of General Data Protection Regulation (GDPR) in2018 the EU has given its people more control over their personal data. The USA hassector specific laws on the privacy of customer data such as health and financialinformation. The APAC and Middle East countries have also specific laws governing dataprotection.

With it's global reach and client base the Company is expected toadhere to various such data privacy compliance requirements. The Company has designed andimplemented a Data protection framework to protect the personal information provided byits customers from engagement until the closure of services. This data protectionframework is integrated with the information security framework in terms of securing theinformation provided by clients. As part of the Data Protection framework the Companyensures that the contractual obligations concerning data protection are adhered to throughtechnical and organizational measures. The Company also analyses the internal and externalenvironment changes including the contractual customer requirements on privacy and thevarious alerts (privacy incidents) to draw inputs for annually updating the PrivacyPolicy. The Company has not only implemented technical and organizational measures toprotect data but also implemented processes for regular monitoring to protect itself fromdata breaches.

41. Disclosure as required under Section 22 of The Sexual Harassment ofWomen at Workplace (Prevention Prohibition and Redressal) Act2013:

The Company has a policy on the prevention of sexual harassment at theworkplace. It has duly constituted the Internal Complaints Committee (ICC) in line withthe requirements of The Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013. The ICC has been set up to redress any complaints receivedregarding sexual harassment and meets periodically. The ICC was reconstituted with newmembers during the financial year 2021-22. This was communicated to all employees fornotification of any POSH related complaints. The POSH policy covers all employees. The ICCdid not have any complaints at the beginning of the year and further has not received anycomplaints during the financial year 2021-22.

42. Listing fees:

The Company confirms that it has paid the annual listing fees for thefinancial year 2021-22 to both National Stock Exchange of India Limited and Bombay StockExchange Limited.

43. Acknowledgments:

The Company thanks its customers bankers and service providers fortheir continued support during the year. The Company places on record its appreciation forthe contribution made by its employees at all levels. Its success was made possible bytheir hard work loyalty cooperation and support.

The Company thanks the Government of India particularly the Ministryof Communication and Information Technology the Ministry of Commerce the Ministry ofFinance the Ministry of Corporate Affairs the Customs and Excise departments the IncomeTax Department the Reserve Bank of India the State Governments Madras Export ProcessingZone (MEPZ) and other government agencies for their support and looks forward to theircontinued support in the future. The Company also thanks the Governments of the countrieswhere it has operations. The Directors wish to record their appreciation of businessconstituents like SEBI NSE BSE NSDL CDSL etc. for their continued support for theCompany's growth. The Directors also thank investors for their continued faith in theCompany.

For and on behalf of Board of Directors of

Expleo Solutions Limited

Ralph Franz Gillessen

Chairman and Non-Executive Director

DIN : 05184138

Place: Ware Hertfordshire United Kingdom

Date : June 17 2022