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GTL Ltd.

BSE: 500160 Sector: Telecom
NSE: GTL ISIN Code: INE043A01012
BSE 14:41 | 25 Jan 17.65 -0.45
(-2.49%)
OPEN

17.30

HIGH

18.40

LOW

17.20

NSE 14:34 | 25 Jan 17.60 -0.50
(-2.76%)
OPEN

17.30

HIGH

18.40

LOW

17.20

OPEN 17.30
PREVIOUS CLOSE 18.10
VOLUME 464158
52-Week high 32.55
52-Week low 4.86
P/E 9.44
Mkt Cap.(Rs cr) 278
Buy Price 17.65
Buy Qty 353.00
Sell Price 17.70
Sell Qty 2101.00
OPEN 17.30
CLOSE 18.10
VOLUME 464158
52-Week high 32.55
52-Week low 4.86
P/E 9.44
Mkt Cap.(Rs cr) 278
Buy Price 17.65
Buy Qty 353.00
Sell Price 17.70
Sell Qty 2101.00

GTL Ltd. (GTL) - Director Report

Company director report

Your Directors present their Thirty Third Annual Report together withthe Audited Financial Statements for the year ended March 312021.

1. STATE OF THE COMPANY'S AFFAIRS FINANCIAL HIGHLIGHTS

(Rs. in Crore)

Particulars FY 2020-21 FY 2019-20
Consolidated Standalone Consolidated Standalone
Total Income 255.98 255.98 227.71 227.71
Profit / (Loss) before Depreciation Exceptional and Tax (PBDT) 71.90 71.90 (226.00) (226.00)
Less: Depreciation 4.66 4.66 4.52 4.52
Profit / (Loss) before Tax exceptional item and extraordinary items 67.24 67.24 (230.52) (230.52)
Exceptional items Nil Nil Nil Nil
Less: Provision for Taxation (incl. Short Provision for Income Tax and Deferred Tax) Nil Nil Nil Nil
Profit / (Loss) after Tax (PAT) before Extra-ordinary and Prior Period items 67.24 67.24 (230.52) (230.52)
Add / (Less): Extra-ordinary item Nil Nil Nil Nil
Profit /(Loss) For The Year From Continuing Operations 67.24 67.24 (230.52) (230.52)
Loss for the year from discontinued operations (21.46) Nil (85.28) Nil
Exceptional Item - Discontinued Operations Nil Nil 285.76 Nil
Other Comprehensive Income for the year (0.19) (0.19) (0.34) (0.34)
Total Comprehensive Income for the period (net of Tax ) 45.59 67.05 (30.38) (230.86)
Add: Balance brought forward from the last year (9329.70) (8674.57) (9299.32) (8443.71)
Loss available for Appropriation (9284.11) (8607.52) (9329.70) (8674.57)
Appropriations:
Recommended Equity dividend Nil Nil Nil Nil
Dividend Distribution Tax N.A. N.A. N.A. N.A.
Amount transferred to
- General Reserve Nil Nil Nil Nil
- Debenture Redemption Reserve Nil Nil Nil Nil
Balance Carried Forward (9284.11) (8607.52) (9329.70) (8674.57)

2. RESULTS OF OPERATIONS

The financial highlights of the Company on a standalone basis for thefinancial year under review are as follows:

• Total Income is Rs. 255.98 Crores as against Rs. 227.71Crores for the previous financial year.

• Profit/ (Loss) before Depreciation Exceptional Items and Tax(PBDT) is Rs. 71.90 Crores as against '(226.00) Crores for the previous financial year.

• Profit / (Loss) after Tax (PAT) before extra-ordinary and priorperiod items is Rs. 67.24 Crores as against ' (230.52) Crores for previous financial year.

3. OPERATIONS

Telecom was considered as the sunrise industry at the beginning of thetwenty first century. Realizing the growth potential in telecom the Company made a forayinto the Telecom Network Engineering and Services domain. Over the years it strengthenedits service offerings to become an integrated network services Company for providingservices to operators OEMs and Tower Companies. In the FY 2010-11 on account of theadverse circumstances surrounding the telecom and power sectors the Company's businessand profitability got affected resulting in admission of the Company into Corporate DebtRestructuring (CDR). Since its admission into CDR the Company had been offering variousproposals including monetization of its assets / business divisions / investments forsettlement of the dues of the lenders. While lenders process to negotiate settlement hasbeen hampered due to litigations on account of the various negative developments in thetelecom industry the Company's business got seriously affected resulting in substantialerosion in its net worth.

The industry itself has undergone challenging times all through itsjourney in the past decade and continue to suffer due to its poor financial health onaccount of the following reasons:

• The exorbitant spectrum prices paid by the operators in 2010& 2015 in the auctions conducted by Department of Telecommunications (DOT)

• Cancellation of 122 Nos of 2G licenses by the Supreme Court ofIndia (SC) in February 2012

• Intense competition unsustainable level of debts and incurringof loss by almost all operators leading to merger / exit of telecom companies (resultingin only 3 private operators) in FY 2017-18

• Technological disruption and tariff competition triggered by theentry of Reliance Jio in FY 2016-17

• Issue of Circular dated February 12 2018 by RBI inter-aliafor withdrawal of CDR and all other restructuring Schemes

• Operational income inadequate to service the debt burden ofcapital expenditure of the operators. Most foreign telecos which earlier made a beelinefor the high growth industry have hardly found any return on India investments.

• Upholding the DOT contention on Adjusted Gross Revenue (AGR) bythe Hon'ble Supreme Court (SC) in October 2019 and also ruling out any possibility of areassessment or recalculation or correction of errors vide its orders dated July 2020 andJuly 2021.

• High degree of leverage by the operators leading tounsustainable level of debt on account of demand for continuous investment due to thefollowing:

• Telecom is a capital-intensive industry needing continuousup-gradation of technology and infrastructure

• For a vast country like India having both urban and rural;educated and uneducated; and haves and have-nots it cannot afford to have a digitaldivide and hence the need for a larger network

• Over passage of time and the new norm that is coming intopractice due to the pandemic the appetite for data is going up tremendously whichtherefore needs continuous investments for network expansion and upgradation

• The information technology (IT) and informationtechnology-enabled services (ITES) have expanded phenomenally establishing India as oneof the ITES power houses of the world

• Compulsion to provide 5G services and difficulty in raisingtariff uNilaterally on account of the stiff competition.

The above industry problems and challenges / drivers coupled withsuspension of tenancy commitment by Aircel Group in 2013 filing for bankruptcy by AircelGroup in March 2018; and termination of contract by MSEDCL in 2014 resulted in the overallset-back to the business operations cash losses and erosion of net worth to the Company.While the Company and its management filed settlement proposals to the lenders based onthe Circulars dated February 2018 /June 2019 the lenders issued notices for recall oftheir loans and taking possession of secured assets invoked the shares pledged by theCompany and Promoter and filed application before DRT.

In view of the above and due to litigation and the rigid stand of somelenders settlement of the dues of the lenders through negotiated settlement got delayed.In the meanwhile in the matter of application under section 7 of the Insolvency andBankruptcy Code 2016 (IBC) filed by one of the lenders before NCLT on appeal SC haspassed status quo order. Further in the recently concluded meeting of the lenders in July2021 all but one lender have agreed in principle for proceeding with the settlementproposal appointment of agents and execution of relevant documents. Hence the Company ishopeful of an early settlement.

Under the above circumstances on account of its loss of revenue /customers inability to incur capital expenditure and erosion of net worth / valuationthe operations of the Company had come down drastically from FY 2018-19 which hasaffected the business and profitability of the Company. Keeping this aspect in mind theCompany continues to implement cost optimization and network optimization measures. Thatcoupled with the non-cash items viz. the exchange variation and the write back provision;and non provision of interest (for the reasons stated elsewhere) have resulted in Profitor (Loss) After Tax (PAT) of Rs. 67.24 Crores for the current FY 2020-21. TheCompany has also taken legal action to recover its dues from Aircel Group MSEDCL GTLInfrastructure Ltd. (GIL) and others. It also continues its efforts with the lenders foran early settlement.

4. DEVELOPMENTS Economy

The financial year 2020-21 saw unprecedented health crisis ofunimaginable proportions causing economic and social upheavels all over the world. TheIndian economy got badly affected not only by the pandemic but also by natural calamitiesand external disturbance.

During FY 2020-21 India got affected by the spread of Covid 19 FirstWave and the declaration of lockdown by the Government of India bringing to halt both theeconomic and social activities. Unfortunately India became the nation with second highestcases in the world. That being not enough since the beginning of the current FY 2021-22India got severely affected by the spread of Covid 19 Second Wave and declaration oflockdown by the State Governments bringing further restrictions on the economic and socialactivities.

Added to that apart from the powerful and catastrophic tropicalcyclone Amphan that caused wide spread damage in the Eastern India in May 2020 extremelysevere Cyclonic Storm Tauktae in the Arabian Sea in May 2021 followed by very severeCyclonic Storm Yaas in the Eastern Coast in the same month caused loss of life andproperty in the regions of both Western and Eastern Coasts of India.

The Indo China stressed border situation in May / June 20 resulted infurther tension and trade restrictions.

The stringent lockdown measures the loss of life and properties andthe strained relationship with the neighbour China put a huge dent on the economy andcaused all sectors apart from agriculture to suffer huge losses. Under the impact ofthese developments India recorded a GDP drop of 23.90 per cent in the period April-June2020.

The world is still not out of the pandemic. The spread of the new deltavariant of coronavirus now has stoked fears of further stalling economic revival globally.

Telecom Industry

5G has emerged as the new focus area for telecom industry in India asin other countries. While the Government is trying to make available the requisitespectrum for 5G services and other facilities the operators are trying to make theirnetworks ready identify partners and test the technology. The Department ofTelecommunications has allotted experimental 5G airwaves and given permission to telcos tocarry out 5G trials in the country. According to ET Telecom.com report dated July 2 2021"Reliance Jio and Airtel had recently started their 5G trials in Delhi-NCR and Mumbairespectively. While Jio is trialing its own 5G technology Airtel is using Ericsson's gearin Gurgaon using 3.5GHz band. Vodafone Idea has started its 5G trials in Pune andGandhinagar in partnership with European vendors Ericsson". The operators are also inthe process of entering into partnership. While Bharti Airtel and Tata Group haveannounced a strategic partnership for 5G networks solutions for India Reliance Jio andGoogle Cloud have announced a partnership for 5G solutions laying foundation for India'sdigitization.

However the adverse judgment by the Honourable Supreme Court in the AGRcase imposing massive additional financial burden of Rs. 1.4 lakh crore beginningwith an upfront 10% payment by March 312021 and the rest in 10 annual installmentsending March 2031 (The Economic Times E Paper dated September 2 2020) on an alreadydistressed industry is likely to put a spanner in the above works. The enormity of thetask before the industry could be well understood if one looks at the present health ofthe Industry - as reported by Business Standard (Mumbai Edition) dated July 3 2021 asunder:

"The combined borrowing of the four incumbent operators BhartiAirtel Vodafone Idea Bharat Sanchar Nigam Ltd. (BSNL) and Mahanagar Telephone Nigam Ltd.(MTNL) - reached an all-time high of Rs. 3.85 trillion at the end of March thisyear. The companies combined debt was up 22.4 per cent year-on-year last financial yearagainst 8.3 per cent growth in their borrowing in the previous year. As a result theincumbent operators debt-equity ratio shot up to an unsustainably high level of 6.83X atthe end of March this year from 2.3X at the end of March 2020. This was largely due to biglosses reported by all these companies last financial year. The four incumbent operatorsracked up combined net losses of Rs. 70000 crore in FY 21. With this theoperators have cumulatively reported a net loss of Rs. 2.45 trillion in the lastfive years equivalent to nearly a third of their cumulative revenues during theperiod."

Thus while the key telecom developments in 2021 viz. spectrum auctionwired broadband and 5G launch are expected to fuel the growth for all telecom operatorswith their present financial health it will be a challenge for them to provide 5G servicein 2021 particularly in the present state of economy.

Challenges of the Telecom Sector

The Competition Commission of India based on the Market Study carriedout by it as a part of the advocacy measures to ensure competitive outcomes has broughtout a Report on January 22 2021 under the caption 'Market Study on the Telecom Sector inIndia - Key Findings and Observations'. The following portion of the said Report bringsout some of the challenges faced by the telecom sector':

"E. Financial Distress of the Sector

29. High costs of spectrum acquisition as mentioned above and thedemands of network upgradation had increased

the industry debt burden. Technological disruption and tariffcompetition triggered by the entry of Reliance Jio jointly aggravated the financialdistress reflected in the unprecedented decline in revenue of the industry through theyears 2017 and 2019. The average revenue of the industry decreased from 5.49 per cent in2012-2013 to 2.51 per cent in 2015-2016 which further declined to -2.82 per cent in2018-2019. The industry estimates for weighted average Return on Equity (ROE) decreasedfrom 7.46 per cent in 2015-2016 to -7.59 per cent in 2017-2018

30. Rising leverage is among the principal challenges facing thesector. The ICR29 for the industry is considerably depressed due to the presence ofheavily indebted operators. An ICR of less than 1 implies that the Earnings beforeInterest and Taxes (EBIT) are insufficient to cover repayment of interest and taxes.Industry estimates since 2014-15 show a declining trend for ICR reflecting the industry'sgeneral inability to service debt and pay taxes.

31. A negative Profit after Tax (PAT) implies that ROE is also negativefor most operators for several years since 2011-12. This presents difficulties for thelong term viability of telecom businesses. Recent investments in RJio and the rightsissued by Airtel and VIL reflect long-term intent and are positive signals for theindustry. By themselves these are however inadequate to address the sustainable futurefor the industry.

67. With the average spectrum holding for an Indian operator lower (31MHz) than the global average of 50 MHz the battered financial health will continue toimpact operators' ability to acquire new spectrum and the subsequent launch of 5G inIndia."

On the above background the following comment made by Lt. Gen Dr. SPKochhar Director General (DG) Cellular Operators' Association of India's (COAI)summarises the challenges faced by the Industry (tele.net December 2020):

" Industry continues to be financially stressed and we seek thesupport of the government in enabling the industry to truly play its role as an enabler ofhorizontal growth and a boost to the nation's economy. Some of the top challenges faced byour member TSPs today are those related to liquidity rationalisation of the regulatorylevies AGR issues spectrum pricing right of way (RoW) rules and cell tower radiation.COAI has been pressing the government and Telecom Regulatory Authority of India (TRAI) onthese" he added."

5. GOING CONCERN

During the last few years the Company has incurred cash lossesresulting in erosion of its entire net worth. The Company's current liabilities are higherthan its current assets. In the matter of application under section 7 of IBC filed by oneof the lenders before NCLT on appeal the SC has passed status quo order. Further in therecently concluded meeting of the lenders in July 2021 all but one lender have agreed inprinciple for proceeding with the settlement proposal appointment of agents and executionof relevant documents.

In view of the above the Management is of the view that throughnegotiated settlement it would be in a position to settle the matter and continue itsoperations. Accordingly it continues to prepare financial statements on a going concernbasis.

6. INVESTMENTS

Pending appropriation of pledged shares invoked by lenders theinvestments held by the company are continued to be classified as long term investments.The Company does not and will not recognize the gain / loss in the market value of suchinvestments as it is not the beneficial owner of them

As regards investments in subsidiaries and associates reference may bemade to the contents under the head 'Subsidiaries'.

7. DIVIDEND

In view of the accumulated losses in the last few years and thedividend restrictions imposed by the lenders your Directors express their inability torecommend any dividend on the paid up Equity and Preference Share Capital of the Companyfor the financial year ended March 312021.

8. SHARE CAPITAL AND NON CONVERTIBLE DEBENTURES (NCDs)

(i) Equity

There is no change in Equity Capital due to allotment of shares orotherwise during the year under review. As such Equity Capital of the Company at thebeginning of the year and at the end of the year stood at 157296781 Equity shares.

The Company has only one class of equity share. Thus the detailsrequired to be furnished for equity shares with differential rights and / or sweat equityshares and / or ESOS under the Companies (Share Capital and Debentures) Rules 2014 arenot furnished.

(ii) Preference

As the Preference Shareholder did not exercise its right for conversionof the preference shares into equity within the stipulated time period there will not beany impact on the Company's equity capital.

(iii) NCDs

During the FY 2009-10 the Company had privately placed 14000 RatedRupee denominated Redeemable Unsecured NCDs of the face value of Rs. 10 Lakhs eachaggregating Rs. 1400 Crores which were listed under debt segment of BSE Limited. TheNCDs got delisted for the reason 'Redemption'. Futher based on the consent terms filed byboth parties before the Hon'ble Bombay High Court on March 19 2018 and the order passedthereon the winding up petition got disposed of. The NCD holder has also signed theInter-Creditor Agreement for settlement subject to secured lenders approval.

9. FIXED DEPOSITS

There are no unclaimed deposits lying with the Company and during theyear under review the Company has not accepted any fresh fixed deposits from Public orfrom its Shareholders.

10. CHANGES IN THE BOARD AND KEY MANAGERIAL PERSONNEL

Mr. SuNil S. Valavalkar (DIN: 01799698) retires by rotation at theensuing Annual General Meeting (AGM) and being eligible offer himself for re-appointment.The re-appointment of Mr. SuNil Valavalkar on his retirement by rotation is forming partof the Ordinary Business in the notice of ensuing AGM. The background of Mr. SuNil S.Valavalkar Director proposed for reappointment is given in the Corporate GovernanceReport which forms part of the Annual Report.

Further since the term of appointment of Mr. SuNil S. Valavalkar as aWhole-time Director expired on December 15 2020 the Board of Directors subject tonecessary approvals re-appointed him as a Whole-time Director w.e.f. December 16 2020for a period of 3 years at their meeting held on November 112020 based on therecommendation of Nomination and Remuneration Committee. The same is forming part of theitems to be considered in the ensuing AGM.

As reported in the last report

(a) in terms of letter No LCG-SSCB.53/36/Nom.8 dated December 9 2019of IDBI Bank Limited Mr. Venkata Apparao Maradani (DIN:08755883) General Manager hasbeen appointed as Nominee Director in place of Mr. Badri Srinivasa Rao Chief GeneralManager w.e.f. June 22 2020; and

(b) on the resignation of Mr. Pratik Toprani as Company Secretary andCompliance Officer w.e.f February 4 2020 Mr. Deepak A. Keluskar has been appointed asthe Company Secretary and Compliance Officer of the Company w.e.f. June 22 2020.

11. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

The information required under Section 197(12) of the Companies Act2013 ('the Act') read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 as amended is given below:

(i) The ratio of the remuneration of each director to the medianremuneration of the employees of the Company for the financial year and percentageincrease in remuneration of each Director Chief Executive Officer Company Secretary orManager if any in the financial year:

Name Ratio to median remuneration % increase in remuneration in the financial year
Executive Director
Mr. SuNil S. Valavalkar 1:2.41 No Change
Non-executive Directors (Sitting Fees only) #
Mr. D. S. Gunasingh N.A. N.A.
Mr. Navin J. Kripalani N.A. N.A.
Mrs. Siddhi M. Thakur N.A. N.A.
Mr.Badri Srinivasa Rao (ceased to be Nominee Director w.e.f June 222020) N.A. N.A.
Mr. Venkata Apparao Maradani (Nominee Director w.e.f. June 22 2020) N.A. N.A.
Dr. Mahesh M. Borase N.A. N.A.
Chief Financial Officer
Mr. Milind V. Bapat No change
Company Secretary
Mr. Deepak A. Keluskar (Company Secretary w.e.f. June 22 2020) No change

 

# Since Non-executive Directors received no remuneration except sittingfees for attending Board / Committee meetings the required details are notapplicable.

(ii) The percentage increase in the median remuneration of employees inthe financial year: 2%

(iii) Number of employees: The number of employees of the Company andits Associates are 1620.

(iv) Average percentile increase already made in the salaries ofemployees other than the managerial personnel in the last financial year and itscomparison with the percentile increase in the managerial remuneration and justificationthereof and point out if there are any exceptional circumstances for increase in themanagerial remuneration: The average annual increase in salaries of employees is 0.2% andthere is no change in managerial remuneration during the year.

(v) Affirmation that the remuneration is as per the remuneration policyof the Company: The Company affirms that the remuneration is as per remuneration policy ofthe Company.

12. DIRECTORS' RESPONSIBILITY STATEMENT

In terms of the provisions of Section 134(3)(c) of the Act the Boardof Directors to the best of their knowledge and ability in respect of the year endedMarch 312021 confirm that:

i) in the preparation of the annual accounts the applicable accountingstandards had been followed and there are no material departures;

ii) they had selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit / loss of the Company for that period;

iii) they had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;

iv) they had prepared the annual accounts on a going concern basis;

v) they had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and

vi) they had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

13. DECLARATION BY INDEPENDENT DIRECTORS

All the Independent Directors of the Company have furnished adeclaration to the effect that they meet the criteria of independence as provided inSection 149(6) of the Act.

14. POLICY ON DIRECTORS' APPOINTMENT & REMUNERATION ETC.

The Company has put in place appropriate policy on Directors'appointment and remuneration and other matters provided in Section 178(3) of the Actwhich is provided in the Policy Dossier that has been uploaded on the Company's websitewww.gtllimited.com. Further salient features of the Company's Policy on Directors'remuneration have been disclosed in the Corporate Governance Report which forms part ofthe Annual Report.

15. PERFORMANCE EVALUATION OF THE BOARD ITS COMMITTEES AND INDIVIDUALDIRECTORS

The Board of Directors has carried out annual evaluation of its ownperformance Board Committees and individual Directors pursuant to the provisions of theAct and Securities & Exchange Board of India (Listing Obligations & DisclosureRequirements) Regulations 2015 (the Listing Regulations).

The performance of the Board and its Committees were evaluated by theBoard after seeking inputs from the Board / Committee members on the basis of the criteriasuch as composition of the Board / Committees and structure effectiveness of Board /Committee processes providing of information and functioning etc. The Board andNomination & Remuneration Committee also reviewed the performance of individualDirectors on the basis of criteria such as attendance in Board / Committee meetingscontribution in the meetings like preparedness on issues to be discussed etc.

In a separate meeting of Independent Directors performance ofnon-independent Directors performance of the Board as a whole and performance of theChairman was evaluated taking in to consideration views of executive and non-executiveDirectors.

16. MANAGEMENT DISCUSSION AND ANALYSIS

Management Discussion and Analysis Report (MD&A Report) for theyear under review as stipulated under Regulation 34 read with Schedule V to the ListingRegulations is presented in a separate section forming part of the Annual Report.

17. CORPORATE GOVERNANCE & VIGIL MECHANISM

A separate Corporate Governance Report on compliance with CorporateGovernance requirements as required under Regulation 34(3) read with Schedule V to theListing Regulations forms part of the Annual Report. The same has been reviewed andcertified by M/s GDA & Associates Chartered Accountants the Auditors of the Companyand Compliance Certificate in respect thereof is given in Annexure A to thisReport.

The Company has formulated a Whistle Blower Policy details of whichare furnished in the Corporate Governance Report thereby establishing a vigil mechanismfor directors and employees for reporting genuine concerns if any.

18. RISKS

A separate section on risks and their management is provided in theMD&A Report forming part of the Annual Report. The Audit Committee monitors the riskmanagement plan and ensures its effectiveness. It is important for stakeholders andprospective investors to be aware of the risks that are inherent in the Company'sbusinesses. The major risks faced by your Company have been outlined in the MD&AReport to allow stakeholders and prospective investors to take an independent view. Westrongly urge stakeholders / investors to read and analyze these risks before investing inthe Company.

19. CORPORATE SOCIAL RESPONSIBILITY

In view of the negative net worth revenue below the prescribed limitand cumulative losses suffered by the Company it is not attracted by the provisions ofSection 135 (5) of the Act. However it is undertaking various projects through 'GlobalFoundation' a Public Charitable Trust.

The brief outline of the Corporate Social Responsibility (CSR) Policyof the Company and other details are furnished in Annexure B of this Report in theformat prescribed in the Companies (Corporate Social Responsibility Policy) Rules 2014.For the CSR initiatives undertaken by Global Foundation reference may be made to MD&AReport under the caption "Corporate Social Responsibility". The CSR Policy isavailable on the Company's website www.gtllimited.com.

20. AUDIT COMMITTEE

The details in respect of composition of the Audit Committee areincluded in the Corporate Governance Report which forms part of the Annual Report.

21. AUDITORS AND AUDITORS' REPORT Auditors:

M/s GDA & Associates (FRN: 135780W) Chartered Accountants wereappointed as Auditors at the Twenty Ninth (29th) Annual General Meeting (AGM)to hold office from conclusion of the said meeting till the conclusion of the ThirtyFourth (34th) AGM. Accordingly they continue to be in office for FY 2021-22.

Cost Auditors:

In terms of the provisions of Section 148(1) of the Act read with theCompanies (Cost Records and Audit) Rules 2014 as amended since the Company's businessis not included in the list of industries to which these rules are applicable the Companyis not required to maintain cost records.

Auditors' Report

As regards the Auditors' modified opinion and emphasis of matters theBoard has furnished required details / explanations in Note Nos. 33.1 and Note No. 46& 6.2 of Notes to Standalone financial statements respectively.

Secretarial Auditors' Report:

The Secretarial Audit report and the Secretarial Compliance Report aregiven in Annexure C and Annexure D respectively.. Compliance with SecretarialStandards:

The Company has complied with applicable Secretarial Standards asprescribed by the Institute of Company Secretaries of India.

22. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

As regards Guarantees and Investments reference may be made to NoteNos. 39c and 6 of the Standalone Financial Statements. The Company has not given any loansto any person / entity except to its employees as at March 312021.

23. PARTICULARS OF RELATED PARTY TRANSACTIONS

There were no materially significant related party transactions made bythe Company with Promoters Directors Key Managerial Personnel or other designatedpersons which may have a potential conflict with the interest of the Company at large.

For the reasons stated below the statement pursuant to Section134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules 2014 giving theParticulars of contracts or arrangements with related parties referred to in section 188(1) of the Act is not enclosed as a part of this Report:

(a) Pursuant to GTL Infrastructure Ltd (GIL) ceasing to be an Associateof the Company w.e.f. March 28 2019 post invocation of pledge of shares of GIL held byit by CDR Lenders the material contracts or arrangement or transactions at arm's lengthbasis entered with GIL in April 12015 ceased to be a related party transaction; and

(b) Other than (a) mentioned above the Company has not entered intoany material contracts or arrangements or transactions with any other related party eitherat arm's length or otherwise.

For full details of Related Party Disclosures reference may be made tonote nos. 40.140.2 and 40.3 of the Standalone Financial Statement.

The policy on Related Party Transactions as approved by the Board isuploaded on the Company's website www.gtllimited.com. None of the Directors has anypecuniary relationships or transactions vis-a-vis the Company.

24. MATERIAL CHANGES AND COMMITMENTS

Save and except as discussed in the Annual Report no material changeshave occurred and no commitments were given by the Company thereby affecting its financialposition between the end of the financial year to which these financial statements relateand the date of this report.

25. SUBSIDIARIES

The assets and liabilities of International Global Tele-systems Ltdare continued to be treated as "Assets held for Sale and discontinuedoperations" in terms of Ind AS105.

Consequent to the order of Supreme Court of Bermuda for dissolution ofGTL International Ltd (GTIL) the Registrar of Companies Bermuda has dissolved GTILw.e.f 17.12.2020 as confirmed by the liquidator. Accordingly the Company ceases to haveany relationship with GTIL and its subsidiaries from the said date.

As required by the Companies (Accounts) Rules 2014 the statementcontaining salient features of the financial statement of the subsidiaries and associateincluded in the Consolidated Financial Statement is presented in Annexure E (FormNo. AOC-1).

26. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION & FOREIGNEXCHANGE EARNINGS AND OUTGO

[Steps taken / actions initiated by the Company for and on behalf ofits customer's viz. telecom tower company and in turn its customers i.e. Telecomoperators]

a. Conservation of Energy:

The company provides Operations Maintenance and Energy Managementservices to its customer and by virtue of the same energy efficiency conservation andits optimal utilization are its key deliverables. As a result the Company continues itsfocus and efforts towards implementing and operating various Energy related initiatives tofulfill its objectives.

i) the steps taken or impact on conservation of energy:

a. Regular Monitoring of field performance of physical infrastructureassets consumption patterns conducting periodic energy audits implementing variousoptimization techniques and effective management of Energy Cycle to ensure good efficiencyat best operating levels of the network..

b. Periodical Corrective and Preventive Maintenance of customer assetsto ensure right levels of load to power ratio thereby controlling excessive overrun ofEnergy utilized.

c. Operating high EB availability sites with optimal fuel stock thusreducing wastage as well as making sites Diesel Free. A total of 3064 customer sites areoperating as Diesel free sites.

d. Sustained efforts to reduce potential pilferage of diesel andelectricity at site through a strong security / monitoring mechanism in the field.

e. Constant monitoring of excessive energy use sites to identify rootcauses and rectify the same thereby controlling the excess consumption for conservingEnergy.

ii) the steps taken by the Company for utilizing alternate source ofenergy:

Undertaking Proof of Concept trials for introducing new technologieslike Li ion Batteries as a potential replacement of Lead acid Batteries and DieselGenerators in extremely high dependent tower sites with excessive

Energy consumption and such other steps based on evaluation at therelevant point of time.

iii) the capital investment on energy conservation equipment:

No capital investment on energy conservation equipment undertakenduring the year

b. Technology Absorption:

1. Efforts made towards technology absorption
2. The benefits derived like product improvement cost reduction product development or import substitution Not applicable as the Company has not absorbed any new technology.
3. In case of imported technology (imported during last 3 years reckoned from the beginning of the financial year) following information may be furnished.
a. the details of technology imported Not applicable as the Company has not imported any technology in the last 3 years.
b. the year of import
c. whether the technology been fully absorbed?
d. if not fully absorbed the areas where absorption has not taken place reasons thereof
4. the expenditure incurred on Research and Development : No expenditures were incurred during the year.

c. Foreign exchange earnings and Outgo:

During the year under review there are no foreign exchange earnings.The foreign exchange outgo is Rs. 0.02 Crore.

27. INTERNAL FINANCIAL CONTROL SYSTEM

The details in respect of adequacy of internal financial control withreference to the financial statements are included in the MD&A Report which formspart of the Annual Report.

28. HUMAN RESOURCES:

Our employees and associate base stood at 1620 as on March 312021 asagainst 1631 as on March 312020. For full details refer to the Human Resources write upin the MD&A Report which forms part of the Annual Report.

29. ANNUAL RETURN AS ON MARCH 312021

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act thedraft Annual Return having all the available information of the Company as on March312021 is available on the Company's website at http://www.gtllimited.com/ind/invinfo.aspx

30. NUMBER OF BOARD MEETINGS HELD DURING THE FY 2020-21

9 (Nine) meetings of the Board were held during the year details ofwhich are furnished in the Corporate Governance Report that forms part of the AnnualReport.

31. PROMOTER GROUP

The Promoter Group comprised of Mr. Manoj G. Tirodkar and GlobalHolding Corporation Pvt. Ltd.

32. PARTICULARS OF EMPLOYEES

The statement containing names of top ten employees in terms ofremuneration drawn and the Particulars of employees as required under Section 197(12) ofthe Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is forming part of this report. Further the report andthe accounts are being sent to the Members excluding the aforesaid statement. In terms ofSection 136 of the Act the said statement is open for inspection and any Memberinterested in obtaining a copy of the same may write to the Company Secretary. None of theemployees listed in the said statement is related to any Director of the Company.

33. ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation andacknowledge with gratitude the support and cooperation extended by the clientsemployees vendors bankers financial institutions investors media and both the Centraland State Governments and their Agencies particularly during the Covid 19 lockdown periodand look forward to their continued support.

On behalf of the Board of Directors
Place: Mumbai D.S. Gunasingh
Date: September 02 2021

Chairman

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