The Board of Directors are pleased to present the Company's 36th AnnualReport and the Company's audited financial statement for the financial year ended March31 2020.
1. Financial Results
The Company's financial performance for the year ended March 312020 is summarizedbelow: -
(Rs. in lakhs)
| ||STANDALONE ||CONSOLIDATED |
| ||2019-20 ||2018-19 ||2019-20 ||2018-19 |
|Revenue from Operations ||487.29 ||471.17 ||487.29 ||471.17 |
|Other Income ||25.96 ||18.62 ||25.96 ||18.62 |
|Profit /(Loss) before Tax ||216.08 ||5.71 ||218.99 ||2.20 |
|Less: Current Tax ||6.29 ||- ||6.29 ||- |
|Deferred Tax ||-157.03 ||- ||-157.03 ||- |
|Profit/ (Loss) for the year ||366.82 ||5.71 ||369.73 ||2.20 |
|Add: Other Comprehensive Income (OCI) ||-2.55 ||1.69 ||-2.52 ||1.69 |
|Total Comprehensive Income for the year ||364.27 ||7.40 ||367.21 ||3.89 |
|Add: Opening Balance in Retained Earnings and OCI (Adjusted) ||-1195.21 ||-1202.61 ||-1203.57 ||-1207.46 |
|Less: Appropriation || || || || |
|- Transferred to Debenture Redemption Reserve || || || || |
|- General Reserve ||- ||- ||- ||- |
|Closing Balance of Retained Earnings and OCI ||-830.94 ||-1195.21 ||-836.36 ||-1203.57 |
2. Transfer to Reserve
The Board of Directors of the Company have not transferred any amount to the Reservesduring the year under review.
3. Result of Operations & State of Company's affairs
During the year under review the total revenue from operations was Rs. 487.29 lakhs onstandalone and Rs. 487.29 lakhs on consolidated basis as compared to the last year'srevenue of Rs. 471.17 lakhs on standalone and Rs. 471.17 lakhs on consolidated basisrespectively. The Profit after tax of your Company was Rs. 366.82 lakhs on standalonebasis and Rs. 369.73 lakhs on consolidated basis as compared to the last year's Profitafter tax was Rs. 5.71 lakhs on standalone basis and Rs. 2.20 lakhs on consolidated basisrespectively.
4. Material changes affecting the Company
Subsequent to the outbreak of Coronavirus (COVID-19) pandemic and consequentialnationwide lock down declared across the country on March 20 2020 by the Government ofIndia which further got extended till May 3 2020 the Company has continued to operateand provide cable services to its customers which has been declared as an essentialservice without any significant disruptions. However disruptions to businesses worldwideand economic slowdown may have its eventual impact on the Company. A definitive assessmentof the impact is not possible at this point of time in view of the highly uncertaineconomic environment and the scenario is still evolving.
The Board of Directors of the Company have not recommended any dividend on EquityShares for the year under review.
6. Management Discussion and Analysis
Management's Discussion and Analysis Report for the year under review as stipulatedunder Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 ("SEBI (LODR)") is presented in a separatesection which forms part of the Annual Report.
7. Business Operation of the Company
This has been a transformational year for Cable Television Business. Postimplementation of New Tariff Order (NTO) from February 12020. The purpose of the newtariff order was to bring transparency to end customers and provide them freedom to watchtelevision of their choice and also to bring fairness in share allocation of subscriptionrevenues within the stakeholders.
To meet the end objective of effective implementation of New Tariff order andestablishing a sustainable renewed business model the Company undertook series oftransformational initiatives. These initiatives largely thrive on our technologicalsupremacy over competition to provide best-in-class experience to customers through ouresteemed Local Cable Operators and many of these are industry first initiatives. Some ofkey initiatives are enumerated below:
Enhanced our system and technical capabilities to meet customer wants to watchtelevision of their choice;
Enables access of Mobile Apps and Portals to customers and LCOs;
Encouraging LCO's to empower their customers with online renewal facility;
Advanced technical capability to provide timely renewal notifications tocustomers coupled with SMS alerts;
Enhanced Customer order fulfillment - Instant Customer Activation;
In view of the NTO the relationship between the stakeholders has improved whichhelped us to drive our initiatives.
8. Consolidated Financial Statement
In accordance with the provisions of the Companies Act 2013 ("the Act") andSEBI (LODR) read with Ind AS-110 (Consolidated Financial Statement) Ind AS-28(Investments in Associates and Joint Ventures) the consolidated audited financialstatement forms part of the Annual Report.
9. Subsidiary Company
During the year under review and till the date of this report no company has become orceased to be subsidiary of the Company.
A Statement providing details of performance and salient features of the financialstatements of Subsidiary company as per Section 129(3) of the Act "AOC-1 " isannexed herewith as Annexure I to this Report.
The audited Financial Statement including the Consolidated Financial Statement of theCompany and all other documents required are available on Company's website and can beaccessed at www.hathwavbhawani.com. The financial statement of the subsidiary Company canalso be accessed at the Company's website.
The Company has formulated a policy for determining Material Subsidiaries. Theaforesaid Policy is placed on the Company's website and can be accessed at https://www.hathwavbhawani.com/assets/pdf/policv-on-material-subsidiarv.pdf
10. Secretarial Standards
The Directors state that applicable Secretarial Standards i.e. SS-1 and SS-2 relatingto Meetings of the Board of Directors' and General Meetings' respectivelyhave been duly followed by the Company.
11. Directors' Responsibility Statement
The Board of Directors state that:
a) in the preparation of the annual accounts for the year ended March 31 2020 theapplicable accounting standards read with requirements set out under Schedule III to theAct have been followed and there were no material departures from the same;
b) the Directors have selected such accounting policies and applied them consistentlyand made judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 312020 and of the profit ofthe Company for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors have prepared the annual accounts on a going concern' basis;
e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
12. Contracts and arrangements with Related Parties
During the year under review all the transactions which were within the purview ofSection 188 of the Act were on arm's length basis and in the ordinary course of business.
Members may refer Note 4.09 to the Standalone Financial Statement which sets outrelated party disclosures pursuant to Ind AS/applicable accounting standards.
13. Corporate Social Responsibility
The Corporate Social Responsibility Committee has formulated and recommended to theBoard a Corporate Social Responsibility Policy (CSR Policy) indicating the activities tobe undertaken by the Company which has been approved by the Board.
In terms of the CSR Policy the focus areas of engagement shall be ruraltransformation affordable healthcare solutions access to quality educationenvironmental sustainability and protection of national heritage.
The Company's average net profit for the three immediately preceding financial yearswas negative. Hence in terms of the Act during the year under review the Company wasnot required to spend any amount on Corporate Social Responsibility activities.
The CSR Policy can be accessed on the Company's website at https://www.hathwavbhawani.com/assets/pdf/CSR-Policv.pdf
14. Risk Management
The Company has in place a Risk Management Policy and an adequate risk managementinfrastructure in place capable of addressing all the risks that the organization facessuch as financial credit market liquidity security property IT (cyber risk) legalregulatory reputational risks and such other risks.
The Board manages monitors and reports on the principal risks and uncertainties thatcan impact its ability to achieve its strategic objectives. The Company's managementsystems organisational structures processes standards code of conduct and behaviorsgoverns how the Company conducts the business and manages associated risks.
15. Internal Financial Controls
The Company has adequate internal financial controls commensurate with the size of thebusiness and nature of its operations designed to provide reasonable assurance withregard to the accuracy and completeness of the accounting records and timely preparationand provision of reliable financial statements.
16. Directors and Key Managerial Personnel Retiring by rotation
In accordance with the provisions of the Act and the Articles of Association of theCompany Mr. Rajesh Kumar Mittal (DIN: 07957284) Non-Executive Director of the Companyretires by rotation at the ensuing Annual General Meeting and being eligible has offeredhimself for re-appointment. The Board of Directors has recommended his re-appointment.Resignation
Ms. Pallavi Balkur had resigned as Non-Executive Director of the Company with effectfrom December 10 2019. Your Directors had placed its sincere appreciation for theservices rendered by her during her tenure as Non-Executive Director of the Company.
In accordance with the Act and the Rules made thereunder Ms. Nerissa Britto (DIN:08716696) was appointed as an Additional Director designated as Non-Executive Director ofthe Company with effect from March 9 2020 to hold the office of Director upto the date ofensuing 36th Annual General Meeting of the Company. Your Company has received anotice in writing under section 160 of the Act from a shareholder proposing thecandidature of Ms. Nerissa Britto for the office of Director whose period of office willbe liable to determination by retirement of directors by rotation. Your Directors haverecommended the same for your approval.
Appointment of ID for a second term
The Members of the Company at the 35th Annual General Meeting of yourCompany held on August 7 2019 had approved by way of a Special Resolution there-appointment of Mr. Dilip Worah (DIN: 00047252) and Mr. L.K. Kannan (DIN: 00110428) asan Independent Directors of the Company to hold office for a second term of 5 (five)consecutive years starting from August 7 2019 to August 6 2024.
In accordance with the provisions of the Act none of the Independent Directors areliable to retire by rotation. The Company has received separate declarations from allIndependent Directors of the Company respectively confirming that:
i) they meet with the criteria of independence as prescribed under Section 149(6) ofthe Act.
ii) they have registered their names in the Independent Directors' Databank.
Change in the Key Managerial Personnel of the Company
During the year under review Ms. Pallavi Balkur resigned as the Company Secretary andCompliance Officer with effect from November 14 2019.
Save and except aforementioned there was no other change in Directors and KeyManagerial Personnel of the Company.
The Company has devised the Nomination and Remuneration Policy setting out the criteriafor determining credentials positive attributes independence of a Director and policyrelating to remuneration for Directors Key Managerial Personnel and Senior Management.The aforesaid Policy is placed on the Company's website and can be accessed athttps://www.hathwavbhawani.com/assets/pdf/hathwav-bhawani-nrc-policv.pdf
There has been no major change in the aforesaid policy during the year.
17. Performance Evaluation
The Company has devised a Policy for performance evaluation of the Board itsCommittees and Individual Directors (including Independent Directors) which includescriteria for performance evaluation of the Non-executive Directors and ExecutiveDirectors. The evaluation process inter alia considers attendance of Directors at Boardand Committee meetings acquaintance with business communication inter se board memberseffective participation compliance with code of conduct etc. which is in compliance withthe applicable laws regulations and guidelines.
Accordingly the performance evaluation of the Board its Committees and IndividualDirectors (including Independent Directors) was carried out during the year.
18. Auditors and Auditors' Report Statutory Auditors
M/s. Nayan Parikh & Co. Chartered Accountants (Firm Registration No. 107023W) wereappointed as Statutory Auditors of the Company for a term of 5 (five) consecutive yearsat the Annual General Meeting held on September 26 2017. They have confirmed theireligibility and qualifications required under the Act for holding office as StatutoryAuditors of the Company.
The Notes on financial statement referred to in the Auditors' Report areself-explanatory and do not call for any further comments. The Auditors' Report does notcontain any qualification reservation adverse remark or disclaimer.
The Board of Directors of the Company had appointed M/s. Rathi & AssociatesCompany Secretaries to conduct Secretarial Audit for the financial year 2019-20. TheSecretarial Audit Report for the financial year ended March 312020 is annexed herewith asAnnexure II to this Report. The Secretarial Audit Report does not contain anyqualification reservation adverse remark or disclaimer.
Meetings of the Board
The Board of Directors met four times during the financial year on April 8 2019 July8 2019 October 11 2019 and January 14 2020. The intervening gap between twoconsecutive meetings was within the period specified under the Act.
The Audit Committee of the Company comprises of 3 members Mr. Dilip Worah IndependentDirector (Chairman) Mr. L. K. Kannan Independent Director and Mr. Rajesh Kumar MittalNon-Executive Director of the Company are the Members of the Committee. The constitutionand terms of reference of the Committee is as per Section 177 of the Act. Allrecommendations made by the Audit Committee were accepted by the Board. The AuditCommittee met four times during the year on April 8 2019 July 8 2019 October 112019and January 14 2020.
Corporate Social Responsibility Committee
The Corporate Social Responsibility (CSR) Committee comprises of 4 members: Mr. DilipWorah Independent Director (Chairman) Mr. L. K. Kannan Independent Director Mr. VatanPathan and Mr. Rajesh Kumar Mittal Non-Executive Directors are Members of the Committee.No meeting of the CSR Committee was held during the year.
Nomination and Remuneration Committee
The Nomination and Remuneration Committee (NRC) comprises of 3 members viz MrL.K.Kannan Independent Director (Chairman) Mr Dilip Worah Independent Director and MrVatan Pathan Non-Executive Director of the Company are the Members of the Committee.During the year the NRC Committee has passed circular resolution on April 6 2019.
Stakeholders' Relationship Committee
The Stakeholders' Relationship Committee comprises of 3 members Mr Vathan PathanNon-Executive Director (Chairman) Mr Rajesh Kumar Mittal Non-Executive Directors and MrDilip Worah Independent Director of the Company are the Members of the Committee. TheCommittee met four times during the year on April 8 2019 July 8 2019 October 11 2019and January 14 2020.
20. Vigil Mechanism
The Vigil Mechanism of the Company also incorporates a Whistle Blower Policy. Protecteddisclosures can be made by a whistle blower through an e-mail or a letter to the immediatesupervisor or Chief Executive officer or the Compliance officer or the Chairman of theAudit Committee of the Company. The Vigil Mechanism and Whistle Blower Policy can beaccessed on the Company's website athttps://www.hathwavbhawani.com/assets/pdf/vigil-mechanism-policv.pdf
During the year under review no protected disclosure concerning any reportable matterin accordance with the Vigil Mechanism and Whistle Blower Policy of the Company wasreceived by the Company.
21. Particulars of loans given investments made guarantees given and securitiesprovided During the year under review there were no loans given investment madeguarantees given or securities provided in terms of Section 186 of the Act.
22. Energy Conservation Technology Absorption and Foreign Exchange Earnings and Outgo
The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclosed under the Act are provided inAnnexure III to this Report.
23. Annual Return
In compliance with provisions of Section 134(3) (a) of the Act the extract of AnnualReturn as per Section 92(3) of the Act has been hosted on the Company's website and canbe accessed at https://www. hathwavbhawani .com/assets/pdf/extract-of-annual-retu rn.pdffor FY 2018-19 and the extract of Annual Return for FY 2019-20 can be accessed at
24. Particulars of Employees and related Disclosures
Disclosures relating 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 forms part of this Report.
Having regard to the provisions of the second proviso to Section 136(1) of the Act andas advised the Annual Report excluding the aforesaid information is being sent to themembers of the Company. Any member interested in obtaining such information may write tothe Company on email id firstname.lastname@example.org.
25. Prevention of Sexual Harassment at Workplace
As per the requirement of the Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 ("POSH Act") and Rules made thereunderthe Company has formed Internal Committee for various work places to address complaintspertaining to sexual harassment in accordance with the POSH Act. The Company has a policyfor prevention of Sexual Harassment which ensures a free and fair enquiry process withclear timelines for resolution. There were no cases/complaints filed during the year underPOSH Act.
The Board of Directors state that no disclosure or reporting is required in respect ofthe following items as there were no transactions or applicability on these items duringthe year under review:
i) Details relating to deposits covered under Chapter V of the Act.
ii) Issue of equity shares with differential rights as to dividend voting orotherwise.
iii) Issue of shares (including sweat equity shares and ESOS) to employees of theCompany under any scheme.
iv) Instances of exercising of voting rights in respect of shares purchased directly byemployees under a scheme pursuant to Section 67(3) of the Companies Act 2013 read withRule 16(4) of Companies (Share Capital and Debentures) Rules 2014.
v) No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.
vi) Fraud has been reported by the Auditors to the Audit Committee or the Board ofDirectors of the Company.
vii) Scheme of provision of money for the purchase of its own shares by employees or bytrustees for the benefit of employees.
viii) The Company is not required to maintain cost records in terms of section 148(1)of the Act.
ix) Payment of remuneration or commission from any of its holding or subsidiarycompanies to the Managing Director of the Company.
x) Details of any application filed for corporate insolvency under Corporate InsolvencyResolution Process under the Insolvency and Bankruptcy Code 2016.
xi) Statement of deviation or variation in connection with preferential issue.
xii) Issue of debentures/bonds/warrants/any other convertible securities.
xiii) Instances of transferring the funds to the Investor Education and ProtectionFund.
The Board of Directors would like to express their sincere appreciation for theassistance and co-operation received from the financial institutions banks Governmentauthorities customers vendors and members during the year under review. The Board ofDirectors also wish to place on record their deep sense of appreciation for the committedservices by the Company's executives staff and workers.