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Goldstone Technologies Ltd.

BSE: 531439 Sector: IT
BSE 00:00 | 21 Jan 79.45 -3.85






NSE 00:00 | 21 Jan 79.30 -4.10






OPEN 82.95
VOLUME 24546
52-Week high 117.80
52-Week low 8.27
P/E 130.25
Mkt Cap.(Rs cr) 275
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 82.95
CLOSE 83.30
VOLUME 24546
52-Week high 117.80
52-Week low 8.27
P/E 130.25
Mkt Cap.(Rs cr) 275
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Goldstone Technologies Ltd. (GOLDTECH) - Director Report

Company director report


The Members

Goldstone Technologies Limited

The Board of Directors are pleased to present the Company's Twenty Seventh AnnualReport and the Company's audited financial statements (standalone and consolidated) forthe financial year ended March 31 2021.


The financial highlights of the Company for the year ended on 31 March 2021 aresummarized as below: (Rs. In Millions Except Otherwise Stated)

Standalone Consolidated
Particulars 2020-21 2019-20 2020-21 2019-20
Revenue from Operations 421.86 351.89 500.10 427.64
Total Expenses 401.43 333.15 499.52 420.77
Operating Profit (PBIDT) 20.43 18.74 0.58 6.87
Interest 2.28 3.25 2.36 3.31
Depreciation & Amortization expense 3.31 3.29 3.34 3.32
Profit before Tax 18.56 12.48 (1.11) 0.71
Current Tax 3.79 - 4.05 0.38
Deferred Tax 0.57 1.61 0.57 1.61
Profit for the year 14.20 10.87 (5.73) (1.28)
Other Comprehensive Income
Re-measurement of gains on defined
benefit plan 1.90 0.65 (1.40) 13.00
Income tax effect (0.53) (0.18) (0.53) (0.18)
Total Comprehensive Income for the Year 15.57 11.34 (7.66) 11.54
Equity Share Capital
(18782066 Shares of Rs 10/- each;
Previous year 18782066 Shares of
Rs 10/- each) 187.82 187.82 187.82 187.82
E.P.S (After Prior Period Items) (Rupees) 0.76 0.58 (0.31) (0.07)
Net Worth 311.66 296.09 438.99 446.66
Book Value in Rs. (Face Value of Rs. 10/- each ) 16.59 15.77 23.37 23.79



During the year under review your Company has reached Standalone turnover of Rs.421.86Million as against a turnover of Rs. 351.89 Million during the previous year. TheStandalone Net Profit/(Loss) is Rs.14.20 Million during the year and in comparison withNet Profit / (Loss) Rs.10.87 Million during the previous year.


During the year under review your Company has reached a consolidated turnover ofRs.500.10 Million as compared to Rs.427.64 Million for the previous financial year. TheConsolidated Net Profit/(Loss) for the year (Rs.5.73) Million in comparison with NetProfit / (Loss) (Rs.1.28) Million during the previous year.


The COVID-19 created havoc in the world economy and severely affected the health ofpeople at large and held the world at its standstill. Accordingly the lockdowns that wereannounced from time to time across India resulting in temporary closure of officessubsequently given work from home option to the employees of the Company in line with thegovernment/local authorities' directions.

However during the lockdown your Company continued to provide support to customerswith the in valuable support of Employees and Management at various levels. As therestrictions were eased out your Company while closely monitoring the situation andfollowing safety guideline started staggered its offices and continuing our commitmenttowards our customers by improving our service efficiencies. True to the Company motto ofPeople Process and Technology employee welfare has been the primary priority for thecompany.


No amount has been transferred to Reserves

during the year.


During the Financial year 2020-21 there is no change in the nature of the business ofthe Company.


During the year the Company does not have adequate profits and hence your Board hasnot recommended any dividend for the financial year 2020-21.


During the year under review there were no changes in authorized and paid-up sharecapital of the Company. The Authorised Share Capital of the company is Rs.500000000(Rupees Fifty Crores Only) divided in to 50000000 (Five Crores Only) equity shares ofRs.10/- each and the Paid up capital of the company is Rs.187820660/- (Rupees EighteenCrore Seventy Eight Lakhs Twenty Thousand Six Hundred and Sixty Only)divided in to18782066 (One Crore Eighty Seven Lakhs Eighty Two Thousand Sixty Six Only) equityshares of Rs 10/- each. The Company neither issued shares with differential voting rightsnor granted stock options/sweat equity.

However the company in its Board Meeting held on 26.08.2021 has approved issue of15800000 equity shares on preferential basis to the promoters and others. In thisregards a resolution is placed at item No. 5 of ensuing annual General Meeting forapproval of shareholders.

As on March 31 2021 except Mr. L.P. Sashikumar having 757 shares none of the otherDirectors of the Company hold shares or convertible instruments of the Company.


The management is of the view that Equity based compensation is considered to beintegral part of employee compensation across sectors which enables alignment of personalgoals of the employees with organizational objectives. Management believes that equitybased compensation schemes are an effective tool to reward the employees of the Company inthe growth of the Company to create an employee ownership in the Company to attract newtalents to retain the key resources in the organization and for the benefit of thepresent and future employees of the Company. With this objective management intends toimplement the Employee Stock Option Plan 2020 for the employees of the Company.

In view of the same and in pursuance of the Section 62 of the Companies Act 2013 andrules thereof SEBI (Share Based Employee Benefits)Regulations 2014 and SEBI (LODR)Regulations 2015 and other relevant provisions the Board of Directors of the Company attheir meeting held on 25th August 2020 had approved the 'Goldstone Technologies LimitedEmployee Stock Option Plan-2020' ('GTLESOP 2020') and also approved by the shareholdersat the 26 AGM

held on 28 September 2020. However the company has not implemented and allotted anyESOPS from the date of last Annual General Meeting till date.


There is no change in accounting treatment in the year under review as compared toprevious Financial Year.



During the year under the review the following changes were made.


Mrs. Deepa Chandra (DIN: 08952233) was appointed as an Independent

Director of the company with effect from 13 November 2020 in the Board Meeting held on13 November 2020. The Board recommends the Ordinary Resolutions set out at Item No. 3 ofthe Notice for approval of the Members. Brief profile of Mrs.Deepa Chandra has been givenin the Notice convening the Annual General Meeting.

Mr. Pavan Chavali (DIN: 08432078) was appointed as a Whole Time Director of theCompany for a period of 3 years with effect from 25 June 2021 in the Board Meeting heldon 25 June 2021. The Board recommends the Special Resolutions set out at Item No. 4 ofthe Notice for approval of the Members. Brief profile of Mr.Pavan Chavali has been givenin the Notice convening the Annual General Meeting.

Retire by Rotation:

Mr. LP Sashi Kumar (DIN: 00016679 ) who retires by rotation at the 27 AnnualGeneral Meeting and being eligible offers himself for re-appointment. Brief profile ofMr.LP Sashi Kumar has been given in the Notice convening the Annual General Meeting.


Ms. Sukhjinder Kaur (DIN : 07926721) resigned from the position of Director witheffect from 20 September 2020 due to her age and other health issues. The Board places onrecord its deep appreciation for the services rendered by Ms.Sukhjinder Kaur during hertenure as Director of the company.

Key Managerial Personnel

In accordance with the provisions of Section(s) 2(51) and 203 of the Companies Act2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014. The following are the Key Managerial Personnel as on the Board's Report date:

Mr. Pavan Chavali- Whole Time Director

Mr. Vithal VSSNK Popuri- Chief Financial Officer

Mr. Thirumalesh T Company Secretary & Compliance Officer


Pursuant to the provisions of the Companies Act 2013 and the applicable regulations ofSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 the Board has carried out an evaluation of its own performance thedirectors individually as well as the evaluation of the working of its Audit Nomination& Remuneration Committees. The manner in which the evaluation has been carried out hasbeen explained in the Corporate Governance Report.

The performance evaluation of the Independent Directors was completed during the yearunder review. The performance evaluation of the Chairman and the Non-Independent Directorswas carried out by the Independent Directors and Non-Executive Directors. The Board ofDirectors expressed their satisfaction with the evaluation process.

The Ministry of Corporate Affairs ('MCA') vide Notification No. G.S.R. 804(E) datedOctober 22 2019 and effective from December 01 2019 has introduced the provisionrelating to inclusion of names of Independent Directors in the Data Bank maintained byIndian Institute of Corporate Affairs ('IICA'). All Independent Directors of your Companyare registered with IICA.

In the opinion of the Board the independent directors possess the requisite integrityexperience expertise proficiency and qualifications.


The Board has on the recommendation of the Nomination & Remuneration Committeeframed and adopted a policy for selection and appointment of Directors Key ManagerialPersonnel and other employees and their remuneration.

The Nomination and Remuneration Policy and other matters provided in Section 178(3) ofthe Act and Regulation 19 of SEBI Listing Regulations have been disclosed in the CorporateGovernance Report which forms part of this Report.


During the year under review 7 (Seven) Board Meetings 4 (Four) Audit CommitteeMeetings 2 (Two) Nomination and Remuneration Committee Meeting 4 (Four) StakeholderRelationship Committee Meetings and 1 (One) Independent Directors meeting were convenedand held. The details of which are given in the Corporate Governance Report.

The intervening gap between the Meetings were within the period prescribed under theCompanies Act 2013 and Listing Regulations.


The details on the familiarization programme for Independent Directors is reported inthe Corporate Governance Report.


In terms of Section 134 (5) of the Companies Act 2013 the directors would like tostate that:

a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;

b) the directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year and ofthe profit and loss of the company for that period; c) the directors had taken proper andsufficient care for the maintenance of adequate accounting records in accordance with theprovisions of this Act for safeguarding the assets of the company and for preventing anddetecting fraud and other irregularities;

d) the directors had prepared the annual accounts on a going concern basis;

e) the directors in the case of a listed company had laid down internal financialcontrols to be followed by the company and that such internal financial controls areadequate and were operating effectively; and

f) the directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.


As on 31 March 2021 we are having one wholly owned subsidiary Company;

a) Staytop Systems Inc. having its Registered office situated at 9660 Falls of NeuseRd. Ste. 138 Unit 161 Raleigh North Carolina 27615 and

b) Staytop Systems and Software Private Limited* having its registered office situatedat 9-1-83 & 84 Amarchand Sharma Complex Sarojini Devi Road Secunderabad Telangana- 500003.

Till date Staytop Systems and Software Pvt Ltd have no business operations.

* submitted requisite forms with Registrar of Companies on 09th May 2019 for strikeoff the name of the company.

During the year no further investments were made in the subsidiaries.

Other than the above no other company is Associate or Joint Venture during the yearunder review.

M/s. Staytop Systems Inc is a material subsidiary of the Company as per the thresholdslaid down under the applicable regulations of Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015. The Company hasframed a policy on Material Subsidiaries as approved by the Board and the same has beenuploaded on the Company's website https://www.goldstone

Pursuant to sub-section (3) of section 129 of the Act the statement containing thesalient feature of the financial statement of a company's subsidiary or subsidiariesassociate company or companies and joint venture or ventures is in the prescribed formatAOC-1 are appended as “Annexure 1” to the BoardRss report.


The Board of Directors ('the Board') reviewed the affairs of the Subsidiaries. Inaccordance with Section 129 (3) of the Companies Act 2013 and applicable AccountingStandards we have prepared consolidated financial statements of the Company and itssubsidiaries which will form part of the Annual Report.

In accordance with Section 136 of the Companies Act 2013 the Audited financialstatements including the consolidated financial statements and related information of theCompany and audited accounts of each of its subsidiaries are available on website of theCompany investor-corner/ These documents will also beavailable for inspection during the business hours at the registered office of theCompany.


At Goldstone we maintain a system of well-established policies and procedures forinternal control of operations and activities. We constantly strive to integrate theentire organisation strategic support functions such as finance human resources andregulatory affairs into core operations such as Analytics segment consulting servicesand license reselling technical support and the supply chain. The internal auditfunction is further strengthened in conjunction with the statutory auditors to monitorstatutory and operational matters. Adherence to statutory compliance is a key focus areafor the entire leadership team of the Company.

The Audit Committee deliberated with the members of the management considered thesystems as laid down and met the internal auditors and statutory auditors to ascertaintheir views on the internal financial control systems. The Audit Committee satisfieditself as to the adequacy and effectiveness of the internal financial control system aslaid down and kept the Board of Directors informed. Internal Audit system bringsSignificant issues to the attention of the Audit Committee for periodic review. Howeverthe Company recognises that no matter how the internal control framework is it hasinherent limitations and accordingly periodic audits and reviews ensure that such systemsare updated on regular intervals.


The deposits covered under Chapter V of the Companies Act 2013 were neither acceptedduring the year nor remained unpaid or unclaimed as at the end of the financial year 2020-21. As such there has been no default in repayment of deposits or payment of interestthereon at the beginning or at the end of the year.


Maintenance of cost records as specified by the Central Government under Section 148(1)of the Companies Act 2013 is not applicable on the Company. Accordingly such recordsare not made and maintained.


As per the provisions of Sec 135 of Companies

Act 2013 every company having net worth of rupees five hundred crore or more orturnover of rupees one thousand crore or more or a net profit of rupees five crore ormore. During immediately preceding financial year shall constitute a Corporate SocialResponsibility Committee of the Board. As your company doesn't fall under the provisionsof sec 135 of Companies Act 2013 hence it is not applicable to company.


All the properties of your Company including its building systems servers &Machinery and also the Company has Insurance coverage for Director and Officer and otherliability insurance have been adequately insured.


Statutory Auditors:

The members at its Annual General meeting held on 28th September 2017 pursuant to theprovisions of the Section 139 and other applicable provisions of the Companies Act 2013appointed M/s. P C N & Associates (FRN: 016016S) Chartered Accountants Hyderabad asStatutory Auditors of the Company to hold office up to the conclusion of 28 Annual GeneralMeeting to held in the year 2022.

However pursuant to the amendments made to Section 139 Act by the Companies(Amendment) Act 2017 effective from May 7 2018 the requirement of seeking ratificationof the members for appointment of Statutory Auditors has been withdrawn. In view of thesame the ratification of members for continuance of appointed M/s. P C N &Associates Chartered Accountants as the Statutory Auditors of the Company is not beingsought.

The Audit Committee of your Company meets periodically with Statutory Auditors andInternal Auditors to review the performance of the Internal Audit to discuss the natureand scope of statutory auditors functions and to discuss auditing internal control andfinancial reporting issues. To ensure complete independence the statutory auditor and theinternal auditor have full access to the Members of the Audit Committee to discuss anymatter of substance.

The Report of the Auditors for the year ended 31st March 2021 forming part of thisAnnual Report does not contain any qualification reservation observation adverse remarkor disclaimer.

Internal Auditors:

M/s. CKS & ASSOCIATES Chartered Accountants Hyderabad appointed as internalAuditors for conducting the internal audit of the company for the financial year 2021-22.The main trust of internal audit is to test and review controls appraisal of risks andbusiness processes besides benchmarking controls with best practices in the industry.

Secretarial Auditor:

The company has appointed M/s. VCSR & Associates Practising Company SecretariesHyderabad to undertake the Secretarial Audit of the Company Pursuant to provisions ofSection 204 of the Companies Act 2013 read with the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014. The Secretarial Audit report for thefinancial year 2020-21 is annexed herewith as “Annexure - 2” to the BoardReport. The Secretarial Audit Report does not contain any qualification reservation oradverse remark. During the year under review the Company has complied with the applicableprovisions of the Secretarial Standards.

Annual Secretarial Compliance Report:

The Company has undertaken an audit for the financial year ended March 31 2021 withall applicable compliances as per SEBI's Regulations and Circulars/Guidelines issuedthereunder. The Annual Secretarial Compliance Report issued by M/s. VCSR & Associates

Practising Company Secretaries Hyderabad

has been submitted to the Stock Exchanges.


The Board has devised proper systems and processes for complying with the requirementsof applicable Secretarial Standards issued by the Institute of Company Secretaries ofIndia (ICSI) and that such systems were adequate and operating effectively.


Details of Loans Guarantees and Investments covered under the provisions of Sec 186 ofThe Companies Act 2013 are given in Note No.29 of standalone Financial Statementsand to Note No.28 of consolidated Financial Statements.


There are no materially significant related party transactions made by the Company withPromoters Key Managerial Personnel or with entities where promoter/KMPs /Directors areinterested and other related parties who may have potential conflict of interest with theCompany. All the related party transactions which were entered into by the Company duringthe year under review were on arms' length basis and in the ordinary course of business.The related party transactions are disclosed in the notes to the accounts as per therelevant accounting standards.

Accordingly the disclosure of related party transactions as required in Form AOC- 2pursuant to Rule 8 (2) of the Companies (Accounts) Rules 2014 are not required.

During the year pursuant to regulation 23 of the SEBI Listing Regulations all relatedparty transactions were placed before the Audit Committee for approval and also disclosedto the stock exchanges on half yearly basis.

A Policy on materiality of Related Party Transaction stipulating the threshold limitsand also on dealing with pursuant to SEBI Listing Regulations has been placed on theCompany's website https://www. investor-corner/


Pursuant to Section 134 (3) (n) and Regulation 21 of Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 read withrelevant provisions of the Companies Act 2013 the Company is implementing all measures tomitigate and manage the risk including identification therein of elements of risk if anywhich in the opinion of the Board may threaten the existence of the company.

At present the company has not identified any element of risk which may threaten theexistence of the company.


Pursuant to SEBI (Prohibition of Insider Trading) Regulations 2015 as amended theCompany has adopted the Code of Internal Procedures and Conduct for Regulating Monitoringand Reporting of Trading by Designated Persons and their Immediate Relatives along withCode of Fair Disclosures and a copy of the same are available on company's website.


The Board has formulated and adopted the following policies as required underSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015

??Archival Policy ??Policy on Material Subsidiary ??Determination of Materiality ofEvents ??Preservation of Documents Policy

All the above policies are hosted on the website of the Companyhttps://www.goldstonetech. com/investor-corner/


As per the provisions of the Section 177 (9) & (10) of the Companies Act 2013 andSEBI (Listing Obligations and Disclosure Requirements) 2015 the Board adopted a VigilMechanism called RsWhistle Blower Policy' for directors and employees to report themanagement /Audit Committee instances of unethical behavior actual or suspected fraud orviolation of companyRss code of conduct or ethics policy. There were no allegations /disclosures / concerns received during the year under review in terms of the vigilmechanism established by the Company.

The Vigil Mechanism also provided adequate safeguards against victimization ofemployees who avail of the mechanism and also provides for direct access to the Chairmanof the Audit committee in exceptional cases further it has also been uploaded in theCompanyRss web site;


Your Company strongly supports the rights of all its employees to work in anenvironment free from all forms of harassment. In order to comply with provisions of theSexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013and Rules framed thereunder the Company has formulated and implemented a policy onprevention prohibition and redressal of complaints related to sexual harassment of womenat the workplace. All women employees permanent temporary or contractual are coveredunder the above policy. The policy aims to provide protection to Employees at theworkplace.

An Internal Complaint Committee (ICC) has been set up in compliance with the said Act.To build awareness in this area the Company has been conducting awareness sessions duringinduction. During the year under review no complaints pertaining to sexual harassment ofwomen employees were reported.


In pursuant to the provisions of Section 134 (3)(a) of the Companies Act 2013 extractof Annual Return in form MGT-9 is annexed herewith as “Annexure - 3” tothe Board Report. Pursuant to provisions of section 92(3) of the Act is placed on thewebsite of the company at


Presently the Company's Shares are listed on BSE Limited (BSE) and National StockExchange of India Limited (NSE).The Company confirms that it has paid Annual Listing Feesdue to all the Stock Exchanges where the Company's securities are listed for the year2021-22.


As per the Regulation 34(3) read with Schedule V of the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015 theCorporate Governance and Management Discussion & Analysis Report which form anintegral part of this Report are attached as

“Annexure - 4” and “Annexure - 5” respectively togetherwith the Certificate from the auditors of the Company regarding compliance with therequirements of Corporate Governance.


As required under the SEBI (LODR) Regulations 2015 the Managing Director and the CFOCertification is attached to Corporate Governance Report.


All Independent Directors have furnished to the Company the requisite declarations thatthey meet the relevant independence criteria as laid down in Section 149(6) of TheCompanies Act 2013 as well as the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.


There were no material changes and commitments affecting the financial position of theCompany that have occurred between the end of the financial year i.e 31 March 2021 towhich the financial statements relate and the date of the Report.


Information on conservation of energy technology absorption foreign exchange andoutgo as required under Sec 134 (3) (m) of the Companies Act 2013 read with Rule 8 of thecompanies (Account) Rules 2014 is annexed herewith as “Annexure - 6”.


Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 ('Rules') are enclosed as “Annexure 7”to the BoardRss report.

In terms of the first proviso to Section 136 of the Act the Reports and Accounts arebeing sent to the Shareholders excluding the information required under Rule 5(2) and (3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.Members who are interested in obtaining the same may write to the Company Secretary at theRegistered Office of the Company. The said information is available for inspection by theMembers at the Registered Office of the Company on any working days of the Company uptothe date of the 27th Annual General Meeting.


Personnel relations have remained very cordial during the period.


There were no significant and material orders passed by Regulators or Courts orTribunal impacting the Company's going concern status and / or its future operations.


Your Directors convey their sincere thanks to State Bank of Inida ICICI Bank Limitedfor their support guidance and assistance.

Your Directors wish to place on record their appreciation for the contribution made bythe employees at all levels but for whose hard work and support your Company'sachievements would not have been possible. Your Directors also wish to thank itscustomers dealers agents suppliers consultants investors for their continued supportand faith reposed in the Company.

For and on behalf of the Board

L.P.Sashikumar Pavan Chavali
Director Whole-Time Director
(DIN: 00016679) (DIN: 08432078)
Place: Hyderabad
Date: 26.08.2021