The Directors are pleased to present their Twenty Seventh Annual Report on thebusiness and operations of Hexaware Technologies Limited
(hereafter referred to as the Group' or The Company') together with auditedfinancial statements for the financial year ended December 31 2019.
The financial statements are prepared in accordance with Indian Accounting Standards(Ind AS').
| || ||(USD million) |
| ||FY 2019 ||FY 2018 |
|Income from Operations ||793.26 ||677.67 |
|EBITDA before RSU cost ||125.26 ||112.12 |
|EBITDA after RSU cost ||124.84 ||106.65 |
|Profit from Operations* ||110.18 ||97.14 |
|Profit before Tax ||110.70 ||105.67 |
|Profit after Tax including share in profit of associate ||91.16 ||84.86 |
|Total Customers ||263 ||224 |
|Average account size ||3.02 ||3.03 |
| || ||(Rs. Million) |
| ||FY 2019 ||FY 2018 |
|Income from Operations ||55825.18 ||46477.62 |
|EBITDA before RSU cost ||8808.82 ||7711.93 |
|EBITDA after RSU cost ||8782.27 ||7338.19 |
|Profit from Operation* ||7748.74 ||6687.64 |
|Add: Exchange Rate Gain (net) ||192.71 ||471.45 |
|Add: Other Income ||89.38 ||105.48 |
|Less: Exceptional Item ||(168.24) ||0.00 |
|Less: Interest ||(74.02) ||(0.42) |
|Profit before share in profit of associate ||7788.57 ||7264.15 |
|Add: Share in profit of associate ||4.10 ||1.66 |
|Profit before Tax ||7792.67 ||7265.81 |
|Less: Provision for Taxation ||1379.24 ||1431.18 |
|Profit after Tax ||6413.43 ||5834.63 |
|Other Comprehensive Income (OCI) ||371.07 ||122.22 |
|Total Comprehensive Income ||6784.50 ||5956.85 |
*excludes Exceptional items Exchange Rate Difference Interest Other Income andProvision for Taxation
| || ||(Rs. Million) |
| ||FY 2019 ||FY 2018 |
|Income from Operations ||21409.11 ||17940.25 |
|EBITDA ||6341.50 ||5470.42 |
|Profit from Operations * ||5731.59 ||4976.35 |
|Less: Exchange Rate (Gain) / Loss (net) ||(336.53) ||(516.82) |
|Less: Interest ||0.42 ||0.28 |
|Add: Other Income ||28.67 ||24.95 |
| || ||(Rs. Million) |
| ||FY 2019 ||FY 2018 |
|Less: Exceptional Items ||5.21 || |
|Profit before Tax ||6091.16 ||5517.84 |
|Less: Provision for Taxation ||1015.83 ||988.25 |
|Profit after Tax ||5075.33 ||4529.59 |
|Add : Balance brought forward from previous year ||9553.14 ||7948.96 |
|Add: Other Comprehensive Income / (loss) (OCI) ||(147.83) ||33.00 |
|Add: Transfer from Special Economic Zone Reinvestment Reserve ||874.10 ||297.25 |
|Balance available for appropriation ||15354.74 ||12808.80 |
|Less: Appropriation || || |
|Interim Dividend including tax on dividend ||3054.31 ||2506.03 |
|Transfer to Special Economic Zone Reinvestment Reserve ||397.64 ||749.63 |
|Balance carried to Balance Sheet ||11902.79 ||9553.14 |
Results of Operations
a) Consolidated operations:
Income from operations increased to H55825.18 million in FY 2019 from H46477.62million in FY 2018 growth of 20.1%. The growth in Dollar terms was 17.1% reaching USD793.26 million in FY 2019 from 677.66 million in FY 2018. Revenue in constant currency wasUSD 801.30 million in FY 2019 growth of 18.2 %. Growth was driven largely by volumeincrease and increase on acquisition of Mobiquity Inc. effective June 13 2019.
EBITDA after RSU costs increased to USD 124.84 million in FY 2019 compared to USD106.65 million in FY 2018 growth of 17.1%. In INR terms it saw growth of 19.7% andincreased to H8782.27 million in FY 2019 compared to H7338.19 million in FY 2018.
Profit from Operations (profit before Exchange rate difference Interest Other incomeexceptional item and Provision for taxation) was at H7748.74 million in FY 2019 asagainst H6687.64 million in FY 2018 growth of 15.9%.
Profit before tax grew 7.3% to H7792.67 million in FY 2019 compared to H7265.81million in FY 2018.
Profit after tax stood at H6413.43 million in FY 2019 as compared to a profit ofH5834.63 million in FY 2018 growth of 9.9%. PAT margins in Rupee terms were at 11.5% inFY 2019 compared to 12.6% in FY 2018.
Material changes from end of financial year till date of report
There are no material changes and commitments affecting the financial position of theCompany which have occurred between the end of the financial year of the Company to whichthe financial statements relate and the date of the report.
Company's major achievements in FY 2019
The Company's investments in building the growth momentum has started paying off withthe Group achieving growth both in revenue as well as in profits.
In FY 2019 growth in revenue was 20.1% in INR terms and 17.1% in USD termscompared to FY 2018.
EBITDA after ESOP/RSU cost growth in FY 2019 was 17.1% in USD terms and 19.7% inINR terms during the year FY 2019.
Profit for the year grew at 7.4% in USD terms and 9.9% in INR terms.
Diluted EPS grew by 10% in FY 2019 over FY 2019.
Return on net-worth continues to be at 25%.
The Group on June 13 2019 acquired 100% equity in Mobiquity Inc. and its subsidiaries(together referred to as Mobiquity) for a total consideration of US$ 182 million.
Mobiquity Inc. is headquartered in the US and with a global presence across 3continents Mobiquity is a customer experience consulting firm that specializes increating frictionless multi-channel digital experiences using cloud technologies.
The Company is expected to leverage Mobiquity's capability in customer experiencetransformation and cloudification. Further the Company is expected to benefit fromMobiquity's customer base in multiple vertical including Banking & Financial servicesand Healthcare & Insurance verticals.
Purchase price has been allocated as set out in note 6(a) of the Consolidated FinancialStatements.
In FY 2019 the Company added 1 client to the $20-$30 million category 4 in the$10-$20 million category 2 in the $5-$10 million category. Significant expansion in the$1-$5 million revenue category was a real highlight for the Company. Overall the Companyadded 30 clients in the > $1M category.
Revenue from top 5 customers has increased by 6% from next 5 increased by 11% and fromnext 10 increased by 29%. The Company is poised to see the shaping of pyramid.
b) India operations:
In FY 2019 the revenue of the standalone legal entity increased by 19.3% to H21409.11million in comparison with revenue of H17940.25 million in the previous year. The netprofit after tax was H5075.33 million as compared to H4529.59 million in FY 2018 showinggrowth of 12%.
The paid-up Share Capital of the Company as on December 31 2019 was H596.77 millioncomprising of 298384321 Equity Shares of H2/- each. During the year 1023332 shareswere exercised under different ESOP schemes.
The market capitalization of the Company as on December 31 2019 was at H99869.23million (USD 1399.02 million). The market capitalization is calculated on the basis ofclosing price of H334.70 on the National Stock Exchange.
The Standalone total other equity increased to H18916.32 million as compared toH16776.08 million as of FY 2018 increase of H2140.24 million
The Consolidated other equity increased to H27057.86 million as compared to H23323.93million as of FY 2018 increase of H3733.93 million.
The Securities premium reserve balances stood at H3846.22 million.
The balance of the Retained earnings after the appropriations for the year isH11902.79 million on standalone basis. On consolidated basis the balance in the Retainedearnings stands at H27057.86 million.
Forex Mark-To-Market: The year-end cash flow hedging reserve (net of tax) stood atprofit of H226.06 million as compared to loss of H14.86 million in the previous yearrecognised in accordance with the hedge accounting provision of Ind AS 109 FinancialInstruments. As at December 31 2019 the Company has balance of H807.77 million inEmployee stock named as Share options outstanding a reserve being amortisation ofcompensation cost of RSU's granted to the employees of the Group.
There was no transfer to General reserve during the year. The general reserve balanceas at end of the year is H2117.71 million
During FY 2019 the Company paid four interim dividends on equity shares Q4 2018 H2.50 (125%) Q1 2019 H2.50 (125%) Q2 2019 H1.50 (75%) Q3 2019 H2.00(100%) totalling to H8.50 per share (425%).
The Board of Directors at its meeting held on February 11 2020 recommended finaldividend of H2.50 (125%) for the year ended FY 2019 with this total dividend declared forFY 2019 aggregated to H8.50 (425%) per share.
The total dividend declared and paid in FY 2019 on account of interim dividend &tax thereon amounts to H3054.31 million.
The break-up of dividend paid during FY 2019 is as under:
| || || || || ||(Rs. Million) |
| ||Q1 ||Q2 ||Q3 ||Q4 ||Total |
|Dividend ||744.26 ||745.03 ||447.51 ||596.74 ||2533.53 |
|Tax ||152.98 ||153.14 ||91.99 ||122.26 ||520.78 |
|Total ||897.24 ||898.18 ||539.49 ||719.40 ||3054.31 |
Particulars of loan guarantee or investments
Loan guarantees and investments covered under section 186 of the Companies Act 2013form part of the notes to the financial statements provided in this Annual Report. Pleaserefer note no. 6A 6B 9A 9B and note no. 25 of Standalone Financial Statements.
Subsidiaries and associates
During FY 2019 Company has acquired Mobiquity Inc for a total consideration of $182million. Headquarter of Mobiquity is in the US and it has global presence across 3continents Mobiquity is one of the largest independent customer experience consultingfirms that specializes in creating frictionless multi-channel digital experiences usingcloud technologies.
Mobiquity creates awesome digital products for some of the most well-known brands inthe world such as Amazon Web Services Rabobank Philips Wawa Backbase and Otsuka.Mobiquity is one of the very few Digital Customer Experience Consulting Partners for AWSand is experts at leveraging some of the most sophisticated capabilities of AWS.
In accordance with Section 129(3) of the Companies Act 2013 consolidated financialstatements of the Company and all its subsidiaries forms part of the Annual Report.Further a statement containing the salient features of the financial statement of oursubsidiaries in the prescribed format AOC - 1 is appended as Annexure 1 to theBoard's report. The statement also provides the details of performance financialpositions of each of the subsidiaries.
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 financial statements of each of its subsidiaries are available on ourwebsite www.hexaware.com.
The cash generated from operations in FY 2019 was H5963.84 million. The Company hasinvested H1296.25 million in property plant and equipment and intangible assets mainlyfor new development centre in Chennai and Pune. Further the Company also investedH8859.18 million for acquisition of Mobiquity Inc. During the year the Company paiddividend including dividend tax of H3054.31 million.
The Company has received H1.63 million from issue of shares. The Subsidiary hasborrowed H1410.53 million during the year. As of December 31 2019 the cash position ofthe Company was H2528.43 million including the restricted bank balance equivalentto USD 35.42 million. The total cash & cash equivalent balance was at H2316.43million equivalent to USD 32.45 million.
Business Strategy The details on Business Strategy are provided on page 114of the Annual report.
India based Global Delivery Centers
The Company has two Offshore Development Centers (ODCs) at Millennium Business Park inMahape Navi Mumbai. One of these is the registered office of the Company. Both theseODC's houses has around 1100 employees.
The Company's BPS arm operates out of three service centers in the same complex witharound 1200 employees providing BPS services to its global clients in shift mode.
The Company has also taken premises on long-term lease for its IT and BPS operation inthe SEZ facility named Loma IT Park Ghansoli Navi Mumbai with seating capacity of around2500 employees including for BPS operations. There are around 1900 employees workingfrom this center.
There are around 5000 IT Professional employees working from the Company's 27acrecampus in Chennai. This campus houses has employee-friendly amenities like recreationcenter library and gymnasium facilities offering plenty of avenues for relaxationand rejuvenation as well as knowledge enhancement through Hexavarsity the Company'sin- house Learning and Development University.
Currently seating capacity is expanded to 5500 seats in Phase 1. The Company has alsoconstructed Phase 2 with additional 3300 seats.
The BPS arm also operates out of another two facilities in Chennai of which one is inSEZ unit with seating capacity of 1650. The combined strength of around 1200 employeesoperates from the facilities.
In Pune the Company has its own SEZ campus at Hinjewadi. The first phase of thiscampus has seating capacity of 1450 seats. Around 1300 IT and BPS employees arecurrently operating from this campus. Mobiquity Softech Private Limited the subsidiarycompany also has office in Pune which has seating capacity of around 170 employees andaround 120 employees are working from this location
The Company has a Delivery Centre at Noida. It has seating capacity of 70 employees.This delivery Centre is in operation at its 100% capacity.
This facility in the India's IT capital of Bengaluru has capacity of 83 seats. Thisdelivery Centre is in operation at its 100% capacity.
The Company owns 20 acres of land in MIHAN SEZ Nagpur a tier II city. This facilityis currently operational with around 630 BPS employees and has seating capacity toaccommodate 1300 professionals in different shifts.
Mobiquity Softech Private Limited the subsidiary company has office in Ahmedabadwhich has seating capacity of around 250 employees and around 184 employees are workingfrom this location.
Hexaware BPS arm has a facility in Coimbatore with seating capacity of 256 employeesand around 58 BPS employees are working from this facility for providing BPS services toits global clients in shift mode.
Overseas Global Delivery Centers
New Jersey (USA)
The Company has GDC at New Jersey USA with seating capacity of 64 employees andcurrently 57 IT Professional Employees are currently working from this delivery center.
Alpharetta GA (USA)
The Company has GDC at Alpharetta in the state of Georgia USA with seating capacity of99 employees and currently 36 IT Professional Employees are currently working from thisdelivery center.
Dunwoody GA (USA)
The Company has GDC at Dunwoody in the state of Georgia USA with seating capacity ofaround 400 employees and currently around 175 IT and BPS employees are working from thisdelivery Centre.
Reston Virginia (USA)
The company has delivery centre at Sunrise Valley in the state of Virginia with seatingcapacity of 70 and currently 70 IT Professional employees are working from this deliveryCentre.
Waltham MA (USA)
Mobiquity has GDC at Waltham MA USA with seating capacity of 50 employees andcurrently around 32 employees are working from this GDC.
Gainesville FL (USA)
Mobiquity has GDC at Gainesville FL USA with seating capacity of 60 employees andcurrently around 46 employees are working from this GDC.
New York NY (USA)
Mobiquity has GDC at Gainesville FL USA with seating capacity of 15 employees andcurrently around 06 employees are working from this GDC.
Wayne PA (USA)
Mobiquity has GDC at Wayne PA USA with seating capacity of 56 employees. Thisdelivery Centre is in operation at its 100% capacity.
San Francisco CA (USA)
Mobiquity has GDC at San Francisco CA USA with seating capacity of 15 employees andcurrently around 06 employees are working from this GDC.
Seattle WA (USA)
Mobiquity has GDC at Seattle WA USA with seating capacity of 12 employees andcurrently around 05 employees are working from this GDC.
The Company has a strong presence in Mexico with a near-shore Delivery Centre atSaltillo with employee's seating capacity of 679. While Mexico offers cost competitivenesscompared to the United States of America the country also provides immense benefits inthe form of same time zone enables immediate response and access to a vast talent pooland an untapped emerging market. The Company intends to leverage its near shore DeliveryCentre to cater to several global clients as an addition to the other existing options ofcontinuing operations in the USA or in the Company's locations in India. Currently around600 IT and BPS Professional Employees are working from this delivery Centre.
Company also have GDC at Monterry Mexico with seating capacity of 137 and currently104 IT Professional employees are working from this delivery Centre.
The Company has GDC at Amsterdam with seating capacity of 12 and currently 06 ITProfessional employees are working from this delivery Centre.
Mobiquity also has office at Amsterdam with seating capacity of 114 employees andcurrently around 220 employees (including employees working onsite) are working from thisoffice.
The Company has GDC at Warsaw in Poland with seating capacity of around 60 employeesand currently around 35 IT and BPS employees are working from this delivery Centre.
The Company has center in Russia for its BPS operation which has seating capacity of156 Employees. Currently around 106 employees are working from this location for providingBPS Services to Global Client.
The Company has GDC at Al Quds Dubai. Currently around 90 BPS employees are workingfrom this delivery Centre at Dubai.
The Company has center in Guangzhou and Shanghai at China for its BPS operation with asmall office.
The Company has GDC at Singapore. Currently around 60 employees are working from thisdelivery Centre (including employees working onsite) at Singapore.
The Company has GDC at Hong Kong. Currently around 20 employees are working from thisdelivery Centre (including employees working onsite) at Hong Kong.
Metro Manila (Philippines)
The Company has center in Philippines for its BPS operation which has seating capacityof 70 Employees. Currently around 48 employees are working from this location forproviding BPS Services to Global Client.
The Company has GDC at Australia. Currently around 40 employees are working from thisdelivery Centre (including employees working onsite) at Australia.
The Company has Global Delivery Centre (GDC) at Japan. Currently around 30 employeesare working from this delivery Centre (including employees working onsite) at Japan.
Human Resource Capital
Human Resource Capital and the value that it creates forms a big part of Company'sgrowth story. The industry today is changing rapidly with automation and digitizationbeing the buzzwords. The focus of the Company has been to leverage digital re-imaginationto drive growth and efficiency of business models products and services businessprocesses as well as the workplace. This helps the Company to deliver a superiorexperience to every key stakeholder viz. customers employees investors and thecommunity at large.
Exceeding customers' expectations requires a high level of focus competence andtechnical expertise. The Company strengthened its recruitment efforts through continuedemployee referrals job fairs social media & campus recruitment drives. Over the lastyear the Company has added 3794 employees taking the total strength to 19999 from16205 at the end of the previous year. The Company is focused towards attracting andretaining high calibre employees through comprehensive Hiring and on-going Deploymentprocesses. The Gender Diversity of Company is more evident now with a healthy 31% of ourworkforce being women.
The Company conducted the EMPPOWER survey an employee engagement survey incollaboration with Great Place to Work. The Company has invested in building a betterworkplace and the survey analysis will help the Company to precisely measure theunderlying level of trust within the Company and help it to take steps to improve the workenvironment through the qualitative and quantitative data that the Company has collected.
The EMPPOWER survey closed with a good response and resulted in 66% positive employeeexperience on the overriding statement. The rating on the engagement index also increasedto 65% from 60% in FY 2018.
The Company is committed to remain focused on its journey to be in the ranked list ofGreat Places to Work and this year's rating will further boost the chances and help theCompany make measurable and impactful changes for employee engagement and welfare.
Talent Management - Asset Development
The Company believes that great talent is the biggest source of competitive advantage.Keeping its talent pool at the centre of all the management strategies is the prime focus.And the senior leadership team is clear in its expectations from the vast reservoir oftalent that the company has.
The company's focus is to develop a strong and internal pipeline of talent and toprovide a platform for talented individuals to shine innovate and create value for ourclients. The company is abreast of the emerging market trends and is at the fore front ofAUTOMATE EVERYTHING CLOUDIFY EVERYTHING TRANSFORM CUSTOMEREXPERIENCES.
One of the initiatives that helps us tap into the collective intelligence of our talentis Brainbox which is a platform for our consultants to post ingenious ideas that go along way in helping our customers save time and money.
The Company believes that Appreciation propels people to give their best at work andour robust Rewards & Recognition (RNR) portal bears testimony to that. Managers cannominate deserving employees for any of the awards such as Spot/Ace/ Star awards bestdebutant and best team etc. Winners are guaranteed global recognition in the Hexawareworld. RNR is also linked to our Performance Management System. Our new Project EndFeedback system ensures that consultants get feedback for every project that they work onand are aware of their areas of improvement.
To help smoothen the process of Performance Management System (PMS) and to familiarizeour people with the nuances of our tool the Company has regular connect sessions andspecific learning modules designed by the HR team. The PMS also has the functionality toidentify future talent needed by the organization and a pipelined approach to groom thefuture leaders of the Company in collaboration with our Learning and Development arm:Hexavarsity. The Company helps to hone the skills of consultants through various traininginterventions at the organization level regular Hackathons organized by our servicepartners as well as the Technical Competency Development Program (TCDP) which focusses onaligning the technical skills of our people to their specific roles.
The company focusses on Talent Management through interventions at every step of theway right from Hiring to Retention. The Company focus on holistic employee developmentthrough our effective performance management system that is a structured and streamlinedprocess to objectively evaluate one's performance against goals that are defined at thestart of the year. In our quest for consistency and excellence we continue to reward ourtop performers through our Hexaware- High Performance Club program the membership towhich is restricted only for 10% of our top achievers.
Employee Engagement is a binding force that help the Company work on a global platformand the Company also understands the need to connect with the Hexaware world on a globalplatform and our internal social networking tool Facebook@ Work helps us to collaboratebrainstorm provide real-time feedback and communicate with our leaders directly. OurFun@Work activities throughout the year help our consultants to relax rewind andrejuvenate themselves. Some of the activities include programs by Funsters group projectoutings project lunches activities that are geared toward team bonding and strengtheningour common goal of working together as one Hexaware despite being spread out in variouslocations worldwide.
The Company's new developmental programs such as Mavericks Hexaware Future Leaders andHexaware Future Executives help employees visualise their career roadmap and make use ofthe plethora of opportunities that allows them to perform their roles to perfection. TheCompany's Talent Management approach is to bring about transformation and growthopportunities for consultants keeping in mind the evolving industry trends and our peoplepractices pivots on a culture that embraces and nurtures talent rewards top performanceand focusses on Customer delight.
In the highly competitive environment for talent supply a sharp focus on managingTalent acquisition development and retention is vital for sustainable talent supply.During the year the company made significant progress on this front and launched severalnew initiatives for talent acquisition.
In North America which is our largest market direct sourcing now constitutes morethan 20% of our supply it helps to save vendor costs for acquisition. The Company hasalso launched a Supplier Development program in North America to increase our sourcingreach in the market. In India we increased our proactive hiring for fast moving skillsand leverage sourcing partners for high volume areas.
The Company is also investing in smart technologies to improve talent acquisition andachieve higher velocity. During the year the Company has implemented new solutions forautomated screening candidate interviews and referral generation to name a few.
We take pride in our continued focus on employee retention. The Company's efforts tomake Hexaware as Great Place to work with a strong focus on employees' career aspirationsrewards & recognition helped to reduce the annualized attrition rate to 15.8% inQ4-2019 from 17% in Q4-2018. Recognizing the fact that the workforce lives your brand theHR team has embarked on a major re-branding exercise to build an engaging organization.For Making Hexaware a Great Place to Work Company has launched an Employee AssistanceProgram by partnering with a counseling service provider (1 to 1 Helpnet) to provideprofessional counseling services to the employees.
To sustain our human capital strategy the company has built human capital indicatorswith increased focus on accountability and ownership from all with inputs from ourleadership team so as to bring about greater accountability and actively participate inthe decision-making process that impacts our people. "The HR shared services" isSLA driven and primarily handles administrative tasks besides providing consultancy andhigh level support to all the arms of our business.
The Corporate HR team includes Centres of expertise catering to functional areas suchas:
Compensation and Benefits
People processes and policy design
Organizational capability development
Talent acquisition (Leadership hiring and Campus Hiring)
Information Security also referred as Cybersecurity gets discussed nowadays at theboard meetings due to its importance to IT Industry digital transformations and newtechnology adoptions. The governance and management of Information Security is ofparamount importance to the Company being its business enabler. Beyond compliance to lawsregulations global standards and industry best practices the expectations of thecustomers focus on capability to managing dynamic landscapes of threats andvulnerabilities to ensure Information Security assurance. In order to align the businessoperations of the Company with the frontline Industry substantial investments had beenmade for secured technology adoption of cloud virtualization innovation ArtificialIntelligence Robotics Machine Learning Deep Learning Digital TransformationAutomation and more. The advantage of such investments by the Company in informationsecurity through latest tools systems and devices provides competitive advantage as wellas Nextgen and Hybrid security cover to business operations of the Company.
Information security management through Confidentiality Integrity and HighAvailability are being time tested by external certification audits and assessmentsthroughout the year as per the process managements of ISO and Industry standards. Thegovernance review of Information security management encompasses all measures recommendedand expected by the international standards legal and regulatory requirements and alsothe customer contracts. Initiatives on digitization automated exploration of operationalsecurity parameters Vulnerability and Threat intelligence risk hunting and riskdiscovery through vulnerability detection / sensors have strengthened the security andminimized the risk during the year elapsed. Continuous Improvement on regulatorycompliance related to GDPR alignment of business processes with Privacy Laws of differentcountries and entities adoption of latest industry best practices and frameworks tostrengthen the security program were also highlights of the elapsed year. Cyber Securityresilience to manage various technical man-made natural and perceived threat scenariosare part of Company's business continuity management program and the certification journeyof the company to get accredited with ISO22301 the global standard for Societal Securityis underway. Role based security education and timely awareness on emerging securitychallenges find a planned evangelization of security trainings imparted to the employeescontractors and associated resources.
The Company has sustained its commitment to the highest levels of qualitybest-in-class agile processes robust information security practices and mature businesscontinuity processes that have collectively helped achieve significant milestones duringthe year. While sustaining existing external benchmarks and certifications the Companyhas added new certifications and further enhanced its programs and initiatives -specifically on GDPR and Business Continuity.
The Company continues to adhere to international quality standard certifications suchas ISO 9001-2015 ISO 27001:2017 ISO 20000-1:2011 CMMI - DEV Ver 1.3 - Level 5 ISAE3402and SSAE16 SOC-2 Type II.
The Company commissioned a survey on customer delight for FY 2019 by Feedback Insightsan independent market research firm to capture customer expectations and measure customerexperience. On a scale of -100 to 100 the Company scored 69.9 as against an industryscore ranging from 36.8 to 76. Over the last 5 years there is significant improvementacross key business metrics.
Benefits to customers:
"Brain Box" is the platform to encourage the employees to bring their ideasvalue addition to our customers and systematically mange the ideation process.
The Company consistently continues to harnesses the power of knowledge gained by itsemployees working on their customer accounts by encouraging them to create &implement value additions through BrainBox.
In FY 2019 64% of the employees have proudly participated in this initiative and haveposted over 1167 ideas proposing value additions under categories like automationproductivity improvement financial savings and accelerate the time to market thecustomer's products and services. 766 of these ideas have been successfully deliveredgenerating savings of over USD 23.52 million and around 298428 hours of effort saved lastyear which is being approved by esteemed customers of the Company. BFS is on top verticalfor implementing 241 CVAs followed by H&I 209 and M&C 144. ADM 308 BIBA 129 andES 113 remain the top competencies/ technologies used by teams to deliver higher number ofCVAs to customers in FY 2019. The total cost saved in FY 2018 was $17.64 millions whereasin FY 2019 the cost saved is $23.52 millions. The count of implemented CVAs has increasedin FY 2019 under various categories; Financial Saving 376 Market Ideas 28 Productivity733 Time to market 30.
Brain Box platform has promoted the culture of deep expertise value creation attitudeextraordinary proficiency in the customer's business function technical engineeringknowledge sharing and problem-solving approach thereby identifying and delivering valuesto the customers at no extra cost. Through a structured governance and rewards programHexaware suitably rewards its employees' passion and best values adds on quarterly basiswhich is personally driven by the CEO leading to larger percentage of employeesparticipating voluntarily in this initiative.
The customers / clients have benefited as a result of the fewer defects reduction incycle time and improved delivery capabilities. The Company has provided value-additionsthrough improvement in the performance of the systems that have been outsourced areduction in the problems and failures and improved stability. This has resulted in highlevels of customer satisfaction and repeat business. Implementing the processes hastrained the organization and people to be methodical and process-driven. The Company hasintroduced and improved upon best-of-breed industry practices and standards leading toimproved delivery capability. Focus on quality has led to lower costs and improvedefficiency within the organization.
Customers have benefited as a result of the high quality of delivery and supportstringent information security practices and flexible and proactive approach. TheCompany's understanding of customer's business and technology landscape enables it toprovide comprehensive multi-service solutions along with cost reduction for the customer.This has resulted in high levels of customer delight and repeat business. Implementing thebest in class processes and providing training on it has enabled the organization andpeople to be methodical and process driven. The usage of latest technologies and industrybest practices has improved delivery capability and added business value. Focus on qualityand automation has resulted in cost reduction and improved productivity within theorganization.
Company focused on Corporate Governance
The Company provides utmost importance to best Corporate Governance practices which aredesigned to act in the best interest of its stakeholders. The fundamentals of CorporateGovernance at the Company includes transparency accountability integrity Independenceethical corporate behaviour and fairness to all stakeholders like employees customersvendors investors and the society at large.
The Company's Board of Directors comprises eminent professionals in their respectivefields with rich experience in policy-making and strategy formulation. All the majorcommittees of the Board are headed by Independent Directors and the Company has followedCadbury Committee's and Kotak Committee recommendation of having two different individualsas Chairman & CEO for several years. The Company was the winner of the prestigiousGolden Peacock Award for excellence in Corporate Governance for the year FY 2011 FY 2015and FY 2018 and won the Special Commendation in FY 2009 and FY 2013.
In compliance with Regulation 34 of the Listing Regulations a separate report onCorporate Governance along certificate from the Auditors on its compliance is attachedand forms part of this Report.
As a global enterprise the Company is exposed to a range of external as well asinternal risks. In order to efficiently manage the risk and to identity and mitigate therisk the Company Enterprise Risk Management (ERM) framework is in place.
The Company has constituted a Strategy and Risk Committee of the Board to assist theBoard in fulfilling its responsibilities with regard to the identification evaluation andmitigation of operational strategic and environmental risks.
The Strategy and Risk committee is Risk Management Committee pursuant to provisions ofSEBI (Listing Obligations and Disclosure Requirement) Regulations 2015.
The details of risk faced by the Company and mitigation measures are discussed indetail in the Management Discussion and Analysis section of this Annual Report.
In today's environment Company's Business Assets Directors & Officers Employeesare exposed to financial risks mainly arising out of claims from customers third partiesregulators employees as well as stakeholders. In order to mitigate the financial impactthat can emanate from such unforeseen risks the company sufficiently insures itself undervarious policies like Workers Compensation and Employers Liability Commercial GeneralLiability Errors & Omissions Cyber Liability Crime Employment Practices LiabilityDirectors & Officers Liability Property Insurance to name a few. Given the evolvingnature of the business and the associated risks individual policy needs and coverage arereviewed on an ongoing basis and changes are effected as deemed prudent. Additionally theCompany has also taken Insurance for employees and their dependents to safeguard thefinancial interests of the employees and their families in case of unforeseen events likehospitalization accident and death.
Internal Financial Control Systems
As a global enterprise large number of employees consultants suppliers and otherpartners collaborate with Company to provide services to our customers. Strong internalcontrols and scalable processes are imperative to manage the global scale of operations.
The Company has proper and adequate system of internal controls commensurate with thesize scale and complexity of its operations. These controls ensure transactions areauthorized recorded and reported correctly and assets are safeguarded and protectedagainst loss from unauthorized use or disposition. In addition there are operationalcontrols and fraud risk controls covering the entire spectrum of internal financialcontrols. An extensive program of internal audits and management reviews supplements theprocess of internal financial control framework.
The internal auditor monitors and evaluates the efficiency and adequacy of internalcontrol system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company and its subsidiaries. Based on thereport of internal auditor process owners undertake corrective action in their respectiveareas and thereby strengthen the controls. Significant audit observations and correctiveactions proposed to fix the observations are presented to the Audit Committee of theBoard.
Further details regarding internal financial Control are included in the ManagementDiscussion and Analysis which form part of this report. Report of statutory auditor onthe internal financial control is also included in this report on page 179.
The Company continues its strong focus and thrust on talent development to ensure thatour work force stays cutting-edge and deliver high value for our customers. Hexavarsityour in-house varsity leads this critical initiative for the Company designing anddelivering innovative programs to build the necessary capabilities from all talentchannels. Our mission is to create an environment that motivates learning andempowers employees to grow and succeed in their chosen career path relevant to thebusiness'.
Evolve' is our next-gen talent transformation program launched in late FY 2018.Evolve is the industry-best program focused on creating comprehensive role-basedcapabilities backed by a stringent assessment that certifies people as Fit for aRole'. The program has been highly appreciated by our customers and employees and won aprestigious Innovation Award this year for making measurable impact and unlocking desiredoutcomes.
During the year the Company launched several initiatives to encourage employees toembrace Evolve' kick start their upskilling process and raise the potential of ouremployees. The goal is to have every consultant in the Company complete at least oneFoundation and one Advance certification by next year. The program coverage continues tobe expanded to cover more functions in the organization provide a learning path andimprove career options for our employees. During the year new Role based certificationswere added for Global Bid Management and Recruitment functions.
During the year Hexavarsity acquired in-house capabilities for a specialist tool basedBehavioral Assessments. Our teams are now certified in the assessment methodology and tooland we are applying behavioral assessments to improve functional team dynamics andrecruiting middle and senior level talent for the organization.
With the increase of agile based delivery traditional customer interaction models havechanged. It is important to develop communication skills in the work force and equip themwell for customer connects. To enable this the Company has launched a"Toastmasters" chapter in Chennai and Mexico. The initiative has been wellreceived by our associates and we are seeing an active participation in the forum by ouremployees.
To meet our growing demand for talent and improve workforce mix the Company has furtherstrengthened the Campus intake and development programs during the year.
The Company has also strengthened Campus Sourcing with a focused Campus team to builddeep Campus connects to attract the best Campus talent for the company both in India andthe USA.
Besides technical talent development from the Campus the company also made a strongfocus on new management talent from the Campus
Fresher Training Program (FTP)
Fresher Training Program (FTP) was re-branded as Mavericks Program' and launchedin June 2019. The Company have made significant changes to the program during the year. Astrong mentorship program regular HR connect and a unique onboarding experience are someof the changes introduced this year. The Mavericks Program is designed aroundLearning to Learn' and Learn by Doing' and further enhanced with Gamificationexperience for the millennials. The Mavericks program covers industry best Soft &Behavioral skills training a strong foundation of Full-Stack Agile training andCompetency specific trainings all backed by a rigorous assessment to ensure steadypipeline of fresh talent into the organization. The Company also piloted a batch of Fullstack Agile training in the USA during the year to build another supply chain of talentfor the North American market.
Senior Management Trainee Program
The Company has re-branded our Senior Management Trainee Program as "HexawareFuture Leaders" program and the Management Trainee Program as "Hexaware FutureExecutives" during the year and designated a mentor to nurture and develop along-term supply chain of management talent for the Company. The program and the outcomeshave been well appreciated by our units and we see a strong demand for more in the comingyears.
The company also continues to invest on external certifications for its consultants.
Related party transactions
During the financial year 2019 the Company has entered into transactions with relatedparties as defined under Section 2(76) of the Companies Act 2013 read with Companies(Specification of Definitions Details) Rules 2014 all of which were in the ordinarycourse of business and on arm's length basis and in accordance with the provisions of theCompanies Act 2013 read with the rules issued thereunder and the SEBI (ListingObligation and Disclosure Requirements) Regulations 2015.
There are no materially significant related party transactions made by the Company withPromoters Directors Key Managerial Personnel or other designated persons which may havea potential conflict with the interest of the Company at large.
All Related Party Transactions are placed before the Audit Committee and Board. Thepolicy on Related Party Transactions is uploaded on the Company's website.
Policy on dealing with related party transaction is available on the website of theCompany. http://hexaware.com/investors/ Policy on determining material subsidiaries of theCompany is available on the website of the Company. http://hexaware.com/ investors/
The details as required to be provided under Section 134(3) (h) of Companies Act 2013are disclosed in form AOC-2 as
Annexure 2 and forms part of this Annual Report
Employee Stock Option Plans (ESOP)
The Company has introduced various employee stock options plans/restricted stock unitplans from time to time to motivate incentivize attract new talent and inculcate thefeeling of employee ownership and reward employees of the Company and employees ofSubsidiaries. The Nomination and Remuneration Committee administers these plans. The stockoption plans are in compliance with Securities and Exchange Board of India (Share BasedEmployee Benefits) Regulations 2014 ("Employee Benefits Regulations") and therehave been no material changes to these plans during the financial year.
No employee was issued stock options during the year equal to or exceeding 1% of theissued capital of the Company at the time of grant.
During FY 2019 following were the exercise made by employees and grant made toemployees/director under ESOPs:
1023332 options were exercised and the Company allotted 1023332 equity shares ofH2/- each (face value) to the employees on such exercise. These shares have been listed onthe BSE Limited and National Stock Exchange of India Limited.
1827746 Restricted Stock Units (RSUs) were granted under 2015 scheme during FY 2019as explained below:
January 30 2019 - 26350 RSUs.
April 24 2019 52100 RSUs.
August 08 2019 1472 750 RSUs.
October 23 2019 2 76 546 RSUs.
Details of the shares issued under Employee Stock Option Plan (ESOP) and also thedisclosures in compliance with Rule 12 of Companies (Share Capital and Debentures) Rules2014 and Securities and Exchange Board of India (Share Based Employee Benefits)Regulations 2014 are available on the website of the company at the following link :http://hexaware.com/investors/
During the year under review the Company did not accept or invite any deposits fromthe public.
Conservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo
The information relating to Conservation of Energy Technology Absorption ForeignExchange Earnings and Outgo required under Section 134(3) (m) of the Companies Act 2013read with Companies (Accounts) Rules 2014 is annexed and forms part of the report.
Insider Trading Regulations
Pursuant to the provisions of SEBI (Prohibition of Insider Trading) Regulations 2015(as amended from time to time) the Company has formulated a Code of Conduct onProhibition of Insider Trading (Insider Trading Code') and a Code of Practices andProcedures for fair disclosure of Unpublished Price Sensitive Information (FairDisclosure Code') which are in force. The Fair Disclosure Code is available on the websiteof the Company at the following link : http://hexaware.com/investors/
Dividend Distribution Policy
The Dividend Distribution Policy containing the requirements mentioned in Regulation43A of the Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 is available on the website of the company at thefollowing link : http://hexaware.com/investors/
Management Discussion and Analysis Report
A detailed analysis of the Company's performance is disclosed in the ManagementDiscussion and Analysis Report which forms part of this Annual Report
Investor Education and Protection Fund (IEPF)
Details of unclaimed Dividend and Shares transferred to IEPF during FY 2019 are givenin Corporate Governance Report.
Directors' Responsibility Statement
Pursuant to Section 134 (3) (c) and (5) of the Companies Act 2013 the Directorsconfirm the following:
(a) in the preparation of the annual accounts the applicable accounting standards havebeen followed and there were no material departures;
(b) the directors have 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 have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;
(d) the directors have prepared the annual accounts on a going concern basis; and
(e) the directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
(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.
Directors and Key Managerial Personnel
During the year following Directors ceased to be Directors of the Company pursuant tocompletion of second term of appointment as an Independent Director:
1. Mr. Basab Pradhan (DIN 00892181) w.e.f June 08 2019
2. Mr. Christian Oecking (DIN 03090264) w.e.f June 25 2019
3. Mr. Dileep Choksi (DIN 00016322) w.e.f October 16 2019
4. Mr. Bharat Shah (DIN 00136969) w.e.f October 16 2019
In accordance with the provisions of Companies Act 2013 Mr. Atul Nishar (DIN:00307229) Director of the Company retires by rotation at this Annual General Meetingand being eligible; offers himself for re-appointment at the Annual General Meeting.
During the year Mr. R Srikrishna (DIN: 03160121) was reappointed as Additional Directordesignated as CEO and Executive Director in the board meeting held on July 13 2019 and tohold office till conclusion next Annual General Meeting. The board has recommended to themembers approval of regularisation of appointment of Mr. R Srikrishna at the forth comingAnnual General Meeting.
The re-appointment of Mr. R Srikrishna as Whole Time Director is subject to approval ofCentral Government. The application for seeking approval of Central Government is filed bythe Company in eform MR 2 and the same is in process with Central Government.
The information of Directors seeking appointment / re- appointment at the AnnualGeneral Meeting to be given to the shareholder as per regulation 36 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 is being provided separately onPage No. 104 & 105 of this Annual Report. Members are requested to refer the saidsection of the Corporate Governance Report.
Number of Meetings of the Board
Ten Meetings of the Board were held during the year. For details of the meetings of theBoard you may refer to the corporate governance report which forms part of this Annualreport.
Declaration by Independent directors
The Independent Directors have submitted a declaration that each of them meets thecriteria of independence as provided in Section 149(6) of the Companies Act 2013 andthere has been no change in the circumstances which may affect their status as independentdirector during the year.
The Ministry of Corporate Affairs (MCA) in association with Indian Institute ofCorporate Affairs (IICA) have introduced the maintenance of a comprehensive onlinedatabank for all the existing and aspiring Independent Directors (ID) by the IICA. TheIndependent Directors have registered themselves on the data bank for IndependentDirectors.
Annual Performance Evaluation was carried out for all Board Members for the Board andits Committees. The Board evaluation framework has been designed in compliance with therequirements under the Companies Act 2013 and the Listing Regulations. The Schedule IV tothe Companies Act 2013 states that the performance evaluation of independent Directorsshall be done by the entire board of Directors excluding the director being evaluated.
The Board evaluation was carried out based on responses received from the Directors onquestionnaire designed.
The performance of the Board was evaluated by the Board after seeking inputs from allthe directors on the basis of the criteria such as the Board composition and structureeffectiveness of board processes information and functioning etc.
The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.
The Chairman of the Board / the Nomination and Remuneration Committee ("NRC")review the performance of the individual directors on the basis of the criteria approvedby the Board.
In a separate meeting of Independent Directors held on December 19 2019 performanceof Non-Independent directors performance of the Board as a whole and performance of theChairman was evaluated.
Training of Independent Directors
Pursuant to Regulation 25(7) of the Listing Regulations the Company conductsfamiliarization programmes for its Directors which includes discussion on IndustryOutlook Regulatory updates at Board and Audit Committee Meetings covering changes withrespect to the Companies Act SEBI Listing Regulations Taxation and other mattersPresentations on Internal Control over Financial Reporting Operational Control overFinancial Reporting Prevention of Insider Trading Regulations Framework for RelatedParty Transactions etc. The Executive Director and Senior Managerial personnel makepresentations at the Board Meetings about Company's operations markets financialresults human resources and on other important aspects.
The terms and conditions of the appointment of every Independent Director is availableon the website of the Company at: http://hexaware.com/investors/
Details of the familiarization programme of the independent Directors are available onwebsite of the Company at http:// hexaware.com/investors/
Committees of the Board
Pursuant to retirement of four Independent Directors during the year the Board ofDirectors has reconstituted committee on December 19 2019.
The Board of Directors have following committees as on December 31 2019:
1. Audit Governance & Compliance Committee
2. Nomination & Remuneration Committee
3. Stakeholders Relationship Committee
4. Corporate Social Responsibility Committee
5. Strategy and Risk Committee
The details of the composition of the committee and attendance of the meetings ofCommittees of the Board are provided in the Corporate Governance report.
The list of committees along with the composition of the same is also available on thewebsite of the Company.
Compliance of Secretarial Standards
The Company complies with all applicable secretarial standards.
Policy on directors and Key Managerial Personnel appointment and remuneration and otherdetails
The Company's policy on directors and Key Managerial Personnel appointment andremuneration and other matters provided in Section 178(3) of the Act has been disclosed inthe corporate governance report.
Whistle blower policy
The Company has established a vigil mechanism/framed a whistle blower policy. Thepolicy enables the employees and other stakeholders to report to the management instancesof unethical behaviour actual or suspected fraud or violation of the Company's code ofconduct or ethics policy. The policy is reviewed annually by the Audit Committee to checkthe effectiveness of the policy. No personnel have been denied access to the AuditCommittee. The provisions of this policy are in line with the provisions of Section 177(9) of Companies Act 2013. The policy is available on the website of the company at :http://hexaware.com/investors/
The Board of Directors of the Company at its meeting held on February 8 2018 haveappointed BSR & Co. LLP Chartered Accountants Mumbai with Registration no.101248W/W-100022 as Statutory Auditors. There appointment was confirmed by the members inthe 25th Annual General Meeting held on May 03 2018 for a period of 5 years to holdoffice till the conclusion of 30th Annual General Meeting.
Vide notification dated May 7 2018 issued by Ministry of Corporate Affairs therequirement of seeking ratification of appointment of statutory auditors by members ateach AGM has been done away with. Accordingly no such item has been considered in noticeof the 27th AGM.
There are no qualifications reservations or adverse remarks made by the statutoryauditors in their audit reports on the Consolidated and Standalone financial statementsfor the year ended December 31 2019.
Internal Audit for the year ended 31st December 2019 was done byPricewaterhousecoopers Private Limited and Internal Audit report at periodic intervalswere placed before the Audit Committee.
M/s. Makarand M Joshi & Co. Practising Company Secretary was appointed to conductthe Secretarial Audit of the Company for the year ended 31st December 2019 as per theprovisions of Section 204 of the Companies Act 2013 read with rules made thereunder. TheSecretarial Audit report for the year ended 31st December 2019 is annexed to Board'sreport as Annexure 3. There are no qualifications reservations adverse remarksmade by Secretarial Auditor in his report except one remark regarding delay by one day infiling Statements of Investor Grievances under regulation 13 of Listing Regulations.
Explanations or comments by the Board on the aforesaid remark:
The board has noted inadvertent delay of one day in filing Statement of InvestorGrievances with Stock Exchange.
Annual Secretarial Compliance Report
The Company has undertaken an audit for the Financial Year 2019 for all applicablecompliances as per Regulation 24A of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and Circulars/Guidelines issued thereunder. The AnnualSecretarial Compliance Report issued by M/s. Makarand M Joshi & Co. PractisingCompany Secretary shall be submitted to the Stock Exchanges within 60 days of the end ofthe Financial Year and the same is available on website of the Company www.hexaware.com.
Reporting of frauds by auditors
During the year under review neither the statutory auditors nor the secretarialauditor has reported to the Audit committee under Section 143 (12) of the Companies Act2013 any instances of fraud committed against the Company by its officers or employeesthe details of which would need to be mentioned in the Board's report.
The Company is not required to maintain cost records as specified under sub-section (1)of section 148 of the Companies Act 2013
Significant/Material Orders Passed by the Regulators
There are no significant material orders passed by the Regulators or Courts orTribunals impacting the going concern status of your Company and its operations in future.
Corporate Social Responsibility
Pursuant to the provisions of section 135 of the Companies Act 2013 the Company spentH99.64 Million towards CSR activities for the year ended 31st December 2019. The contentsof the CSR policy and initiatives taken by the Company on Corporate Social Responsibilityduring year ended on 31st December 2019 as per the format prescribed in the Companies(Corporate Social Responsibility Policy) Rules 2014 is attached as Annexure 4 tothis Report and CSR policy of the Company is available on our website at www.hexaware.com.The Composition of CSR Committee is given in the Corporate Governance Report.
Extract of annual return
As provided under Section 92(3) of the Act the extract of annual return in theprescribed Form MGT-9 is available on our website at www.hexaware.com and is alsoattached as Annexure 5 to this report.
The company has received an order from the Company Law Board under section 2 (41) ofthe Companies Act 2013 for continuing January to December as its financial year. Hencethe Company will maintain its financial year from January 1 to December 31.
The Mobiquity Softech Private Limited the subsidiary company has also receivedapproval from Regional Director Ahmedabad under section 2 (41) of the Companies Act 2013for continuing January to December as its financial year and to keep the current financialyear as starting from 1st April 2019 and ending on 31st December 2019 i.e. for period of9 months and subsequently to continue calendar year as its financial year from 1st Januaryof every year and ending on 31st of December.
Particulars of Directors and Employees
The table containing names and other particulars of Directors in accordance with theprovisions of Section 197(12) of the Companies Act 2013 read with rule 5 (i) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is enclosed asAnnexure 6 to the Board Report.
The statement containing particulars of employees as required under Section 197(12) ofthe Act read with Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is provided in a separate annexure forming part of this report.Further the report and the accounts are being sent to the members excluding the aforesaidannexure. In terms of Section 136 of the Act the said annexure is open for inspection.Any shareholder interested in obtaining a copy of the same may write to the CompanySecretary.
Disclosure as required under Section 22 of Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013
The Company has in place a framework for employees to report sexual harassment cases atworkplace and our process ensures complete confidentiality of information. The Company hasin place Prevention of Sexual Harassment (POSH) policy in line with the requirements ofthe Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act2013. Frequent communication of this policy is done through various programs and atregular intervals to the employees.
The Company has setup an Internal Complaints Committee (ICC) both at the registeredoffice and at every location where it operates in India in accordance with the Act and hasrepresentation of men and women and is chaired by senior lady member and has an externalwomen representation.
Awareness programs are conducted during induction for sensitizing the employees withthe provisions of the Act. The following is the summary of the complaints received anddisposed of during the financial year 2019: a) No. of complaints received during the year:01 b) No. of complaints disposed of: 01 c) No. of complaints pending : NIL
The Company started a sustainability initiative with the aim of going green andminimizing the impact on the environment. Like the previous years this year too theCompany is publishing only the statutory disclosures in the print version of the AnnualReport. Additional information is available on our website www.hexaware.com.
As a part of Green Initiative notice calling the Annual General Meeting Corporategovernance report Directors' report Audited financial statements Auditors' report etcare being sent through electronic mode to those members whose email addresses areregistered with the company / depositories.
Members may note that notice and annual report FY 2019 will also be available onCompany's website www.hexaware.com websites of stock exchanges i.e. BSE Limited andNational stock exchange of India Limited at www.bseindia.com and www. nseindia.comrespectively and on the website of NSDL www. evoting.nsdl.com The Company providese-voting facility to all its members to enable them to cast their votes electronically onall resolutions set forth in the Notice. This is pursuant to the Section 108 of theCompanies Act 2013 and Rule 20 of the Companies (Management and Administration) AmendmentRules 2015. The facility of electronic voting system shall be made available during theAGM and the members attending the meeting who have not cast their vote by remote e-votingshall be able to exercise their rights to vote during the AGM through electronic votingsystem.
Business Responsibility Report
The Business Responsibility Report' (BRR) of the Company for FY 2019 forms partof this Annual Report as required under Regulation 34(2)(f) of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.
The Directors place on record their sincere appreciation of the customers Governmentof India and of other countries vendors bankers and Technology Partners for the supportextended. The Directors are also deeply touched by the efforts sincerity and loyaltydisplayed by the employees without whom the growth of the Company is unattainable. TheDirectors wish to thank the investors and shareholders for placing immense faith in them.The Directors seek and look forward to the same support during the future years of growth.
SECRETARIAL AUDIT REPORT
For Financial Year Ended 31st December 2019
[Pursuant to section 204(1) of the Companies Act 2013 and rule 9 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014]
Hexaware Technologies Limited
152 Millennium Business Park
Sector III A' Block TTC Industrial Area
Mahape Navi Mumbai 400710
We have conducted the secretarial audit of the compliance of applicable statutoryprovisions and the adherence to good corporate practices by Hexaware TechnologiesLimited (hereinafter called the Company). Secretarial Audit was conducted in a mannerthat provided us a reasonable basis for evaluating the corporate conducts/ statutorycompliances and expressing our opinion thereon.
Based on our verification of the Company's books papers minute books forms andreturns filed and other records maintained by the Company and also the informationprovided by the Company its officers agents and authorized representatives during theconduct of secretarial audit We hereby report that in our opinion the Company hasduring the audit period covering the financial year ended on 31st December 2019(hereinafter called the Audit Period') complied with the statutory provisions listedhereunder and also that the Company has proper Board-processes and compliance-mechanism inplace to the extent in the manner and subject to the reporting made hereinafter :
We have examined the books papers minute books forms and returns filed and otherrecords maintained by the Company for the financial year ended on 31st December 2019according to the provisions of:
(i) The Companies Act 2013 (the Act) and the rules made there under;
(ii) The Securities Contracts (Regulation) Act 1956 (SCRA') and the rules madethere under;
(iii) The Depositories Act 1996 and the Regulations and Bye-laws framed there under;
(iv) Foreign Exchange Management Act 1999 and the rules and regulations madethereunder to the extent of Foreign Direct Investment and Overseas Direct Investment (ExternalCommercial Borrowings are not Applicable to the Company during the Audit Period);
(v) The following Regulations and Guidelines prescribed under the Securities andExchange Board of India Act 1992 (SEBI Act'):-
(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares andTakeovers) Regulations 2011;
(b) The Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 2015;
(c) The Securities and Exchange Board of India (Issue of Capital and DisclosureRequirements) Regulations 2018 (Not Applicable to the Company during the AuditPeriod);
(d) The Securities and Exchange Board of India (Share Based Employee Benefits)Regulations 2014;
(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities)Regulations 2008; (Not Applicable to the Company during the Audit Period);
(f) The Securities and Exchange Board of India (Registrars to an Issue and ShareTransfer Agents) Regulations 1993 regarding the Companies Act and dealing with client;
(g) The Securities and Exchange Board of India (Delisting of Equity Shares)Regulations 2009 (Not Applicable to the Company during the Audit Period); and
(h) The Securities and Exchange Board of India (Buyback of Securities) Regulations2018 (Not Applicable to the Company during the Audit Period);
(vi) We further report that having regard to the compliance system prevailingin the Company and on the examination of the relevant documents and records in pursuancethereof on test-check basis the Company has complied with the following law applicablespecifically to the Company:
The Special Economic Zone Act 2005
Policy relating to Software Technology Parks of India and its regulations
We have also examined compliance with the applicable clauses of the following:
(i) Secretarial Standards issued by The Institute of Company Secretaries of India.
(ii) The Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015. (here and after referred asListing Regulations')
During the period under review the Company has complied with the provisions of the ActRules Regulations Guidelines and Standards made there under except delay by 1 day infiling statements of investor grievances under regulation 13 of Listing Regulations.
We further report that
The Board of Directors of the Company is duly constituted with proper balance ofExecutive Directors Non-Executive Directors and Independent Directors. The changes in thecomposition of the Board of Directors that took place during the period under review werecarried out in compliance with the provisions of the Act.
Adequate notice is given to all directors to schedule the Board Meetings agenda anddetailed notes on agenda were sent at least seven days in advance and a system exists forseeking and obtaining further information and clarifications on the agenda items beforethe meeting and for meaningful participation at the meeting.
All decisions at Board Meetings and Committee Meetings are carried out unanimously asrecorded in the minutes of the meetings of the Board of Directors or Committee of theBoard as the case may be.
We further report that there are adequate systems and processes in the Companycommensurate with the size and operations of the Company to monitor and ensure compliancewith applicable laws rules regulations and guidelines.
We further report that during the audit period the Company has allotted 1023332Equity Shares pursuant to Exercise of the Option granted under different schemes of theCompany.
| ||For Makarand M. Joshi & Co. |
| ||Makarand Joshi |
| ||Partner |
| ||FCS No. 5533 |
| ||CP No. 3662 |
|Place: Mumbai ||UDIN: F005533B000136081 |
|Date: February 11 2020 ||Peer Review No. P2009MH007000 |
This report is to be read with our letter of even date which is annexed as Annexure Aand forms an integral part of this report.
Hexaware Technologies Limited
152 Millennium Business Park
Sector III A' Block TTC Industrial Area
Mahape Navi Mumbai 400710
Our report of even date is to be read along with this letter.
1. Maintenance of secretarial record is the responsibility of the management of thecompany. Our responsibility is to express an opinion on these secretarial records based onour audit.
2. We have followed the audit practices and processes as were appropriate to obtainreasonable assurance about the correctness of the contents of the Secretarial records. Theverification was done on test basis to ensure that correct facts are reflected insecretarial records. We believe that the processes and practices we followed provide areasonable basis for our opinion.
3. We have not verified the correctness and appropriateness of financial records andBooks of Accounts of the company.
4. Where ever required we have obtained the Management representation about thecompliance of laws rules and regulations and happening of events etc.
5. The compliance of the provisions of Corporate and other applicable laws rulesregulations standards is the responsibility of management. Our examination was limited tothe verification of procedures on test basis.
6. The Secretarial Audit report is neither an assurance as to the future viability ofthe company nor of the efficacy or effectiveness with which the management has conductedthe affairs of the company.
| ||For Makarand M. Joshi & Co. |
| ||Makarand Joshi |
| ||Partner |
| ||FCS No. 5533 |
| ||CP No. 3662 |
|Place: Mumbai ||UDIN: F005533B000136081 |
|Date: February 11 2020 ||Peer Review No. P2009MH007000 |
CSR REPORT FY 2019
1. A brief outline of the company's CSR policy including overview of projectsor programs proposed to be undertaken and a reference to the web-link to the CSR policyand projects or programs.
Hexaware Technologies Limited (Hexaware) is committed to contributing towards itssocietal responsibilities beyond statutory obligations. HEXAWARE's Corporate SocialResponsibility (CSR) initiative aims to broaden the vision of being accountable to thecommunity and the environment. Our belief in good citizenship is a driver to createmaximum impact through our CSR programs in areas of:
1. Education and woman empowerment
3. Health and sanitation
5. Skill development
The CSR Policy adopted by Hexaware is available in the given web link:http://hexaware.com/fileadd/csr-policy.pdf
2. The Composition of the CSR Committee.
HEXAWARE has constituted a robust governance structure to oversee the implementation ofthe CSR projects in compliance with the requirements of Section 135 of the Companies Act2013. The members of the CSR committee as on December 31 2019:
|Name ||Designation |
|Mrs. Meera Shankar ||Chairperson |
|Mr. Atul Nishar ||Member |
|Mr. Jimmy Mahtani ||Member |
3. Average net profit of the company for last three financial years H4981.44Million
4. Prescribed CSR Expenditure (two per cent. Of the amount as in item 3 above) H99.63 million
5. Details of CSR spent during the financial year.
(a) Total amount to be spent for the financial year: H99.63 million
(b) Amount unspent if any: Nil
(c) Manner in which the amount spent during the financial year is detailed below.
|Sr.no.CSR Project or activity identified ||Sector in which project is covered ||Projects or Programs 1. Local area or other 2. Specified Location ||Amount Outlay (budget) on Project or Programs (in H) ||Amount spent on the projects or programs (in H) 1. Direct Expenditure 2. Overheads ||Cumulative expenditure up to the reporting period (in H) ||Amount Spent: Direct or through implementing agency |
|1.Udaan - Empowerment of children of sex workers in the red-light area ||Eradicating hunger poverty and malnutrition promoting education ||1. Local 2. Mumbai ||1281057 ||1259977 ||1259977 ||Through implementing agency: Apne Aap Women's Collective |
|2. Umeed- Empowerment of Women by providing alternative livelihood opportunities for women in red light area ||Eradicating hunger poverty and malnutrition promoting education enhancing vocational skills livelihood enhancement ||1. Local 2. Mumbai ||2484235 ||2460672 ||2460672 ||Through implementing agency: Apne Aap Women's Collective |
|3. Digital and Financial Education ||Promoting education ||1. Local 2. Chennai Mumbai ||2805300 ||2975760 ||2975760 ||Through implementing agency: America India Foundation Trust |
|4. Antar Bharti Balgram Yojna - Holistic development of underprivileged children ||Eradicating hunger poverty and malnutrition promoting preventive health care and sanitation promoting education enhancing vocational skills livelihood enhancement ||1. Local 2. Lonavala Pune ||4400000 ||4400000 ||4400000 ||Through implementing agency: India Sponsorship Committee |
|5. Art Education and Seminar - Art 1st ||Promoting education ||1. Local 2. Mumbai ||1520000 ||1368000 ||1368000 ||Through implementing agency: Art 1st Foundation |
|6. Art Education and Seminar - Art 1st ||Promoting education ||1. Local 2. Mumbai ||300000 ||300000 ||300000 ||Through implementing agency: Art 1st Foundation |
|7. Avishkar Hyperloop Project - IIT Madras ||Promoting education ||1. Local 2. Chennai ||1000000 ||1000000 ||1000000 ||Through implementing agency: IITM Student's Activities Trust |
|8.Clean and Safe Neighbourhood ||Ensuring environmental sustainability ||1. Local 2. Chennai Pune ||2423931 ||2423931 ||2423931 ||Direct |
|9. Providing digital literacy in 10 Government Schools through setting up of computer labs ||Promoting Education ||1. Local 2. Chennai ||1458816 ||1312934 ||1312934 ||Through implementing agency: Team Everest |
|10. Nutritional Outreach Program ||Eradicating hunger poverty and malnutrition and promoting preventive health care ||1. Local 2. Mumbai ||4174000 ||4141303 ||4141303 ||Through implementing agency: Cuddles Foundation |
|11. Pond Restoration Projects - Environmental Foundation of India ||Ensuring environmental sustainability ||1. Local 2. Chennai ||3799400 ||2984000 ||2984000 ||Through implementing agency: Environmental Foundation of India (EFI) |
|12. Armed Forces Flag Day Fund ||For State & Central Funds ||1. Local 2. Chennai ||25000 ||25000 ||25000 ||Through implementing agency: Flag Day Fund |
|13. Providing Scholarship to 425 underprivileged and meritorious students to support higher studies ||Promoting Education ||1. Local 2. Pune Chennai Mumbai ||4000000 ||4000000 ||4000000 ||Through implementing agency: IDEA Foundation |
|14. Seminar on Indian Women Scientist ||Promoting women empowerment ||1. Local 2. Mumbai ||500000 ||500000 ||500000 ||Through implementing agency: Indian Women Scientists' Association |
|15. Mentorship & Skill Training for Girls ||Promoting education including employment enhancing vocation skills among women ||1. Local 2.Mumbai ||1664160 ||1717188 ||1717188 ||Through implementing agency: Katalyst India |
|16. Skill development training for employability ||Promoting employment enhancing vocation skills and livelihood enhancement among youth ||1. Local 2. Mumbai Pune Chennai Lonavala ||9127000 ||6375225 ||6375225 ||Through implementing agencies: Magic Bus Foundation |
|17. Providing prosthetic legs for amputees ||Eradicating hunger poverty and malnutrition and promoting preventive health care ||1. Local 2. Chennai ||1000000 ||1000000 ||1000000 ||Through implementing agencies: Dream Runner Foundation |
|18. Promoting children's education ||Promoting education ||1. Local 2. Mumbai ||732000 ||732000 ||732000 ||Through implementing agency: Save The Children |
|19. Promoting children's education ||Promoting education ||1. Local 2. Mumbai ||732000 ||732000 ||732000 ||Through implementing agency: Helen Keller Institute |
|20. Promoting children's education ||Promoting education ||1. Local 2. Mumbai ||272000 ||272000 ||272000 ||Through implementing agency: Manav Foundation |
|21. Promoting children's education ||Promoting education ||1. Local 2. Mumbai ||277000 ||277000 ||277000 ||Through implementing agency: United Way |
|22. Promoting children's education ||Promoting education ||1. Local 2. Mumbai ||732000 ||732000 ||732000 ||Through implementing agency: Apna Aap Women's Collective |
|23. Promoting children's education ||Promoting education ||1. Local 2. Mumbai ||229700 ||229700 ||229700 ||Through implementing agency: Jayaprakash Narayan Memorial trust |
|24. Promoting children's education ||Promoting education ||1. Local 2. Mumbai ||455000 ||455000 ||455000 ||Through implementing agency: Helen Keller Institute |
|25. Supporting junior women athletes and para athletes in sports training ||Training to promote nationally recognized sports and Olympic sports ||1. Local 2. Mumbai ||6000000 ||5750000 ||5750000 ||Through implementing agency: Olympic Gold Quest |
|26. Providing complete care program including healthcare and education support to girls on living on the streets ||Eradicating hunger poverty and malnutrition promoting preventive health care and sanitation promoting education ||1. Local 2. Chennai Mumbai ||8430762 ||9119432 ||9119432 ||Through implementing agency: Rainbow Homes |
|27. Skill development training for employability ||Promoting employment enhancing vocation skills and livelihood enhancement among youth ||1. Local 2. Mumbai Pune Chennai Lonavala ||1274595 ||1274595 ||1274595 ||Through implementing agencies: Smile Foundation |
|28. Holistic development and nurturing of underprivileged children ||Eradicating hunger poverty and malnutrition promoting preventive health care and sanitation promoting education enhancing vocational skills livelihood enhancement ||1. Local 2. Pune Bangalore Chennai Mumbai ||4536000 ||5382720 ||5382720 ||Through implementing agency: SOS Children's Village |
|29. Promoting science awareness among high school students increasing their understanding of science and attracting them into scientific careers through activities emphasizing hands-on research. ||Promoting Education ||1. Local 2. Chennai ||4000000 ||3600000 ||3600000 ||Through implementing agency: Space Kidz India |
|30. Providing training to people with disability to get employment in retail industry ||Promoting education including special education and employment enhancing vocational skills ||1. Local 2.Pune Mumbai Chennai ||6191195 ||6149081 ||6149081 ||Through implementing agency: TRRAIN |
|31. Vocational training centre and support for Persons with Disability ||Promoting employment enhancing vocation skills and livelihood enhancement projects among differently abled ||1. Local 2. Chennai ||1203250 ||1380003 ||1380003 ||Through implementing agency: V- Excel Educational Trust |
|32. Early intervention Programme ||Promoting education including special education for the differently abled ||1. Local 2. Chennai ||2250000 ||2323923 ||2323923 ||Through implementing agency: V-Excel Educational Trust |
|33. Promoting hygiene sanitation practices in 21 Government Schools ||Promoting Education promoting preventive health care and sanitation ||1. Local 2. Mumbai ||21000000 ||19600000 ||19600000 ||Through implementing agency: Yuva Unstoppable |
|34. Monitoring Evaluation of projects and administrative expenses ||- ||1. Local 2. Pune Chennai Mumbai ||3389981 ||3389981 ||3389981 ||Direct |
|Total || || ||103668382 ||99643425 ||99643425 || |
6. In case the company has failed to spend the two per cent of the average netprofit of the last three financial years or any part thereof the company shall providethe reasons for not spending the amount in its Board report.
Since the company has spent the entire 2% of the prescribed budget this question isnot applicable.
7. A responsibility statement of the CSR Committee that the implementation andmonitoring of CSR Policy is in compliance with CSR objectives and Policy of the company.
The implementation and monitoring of our CSR Policy is in compliance with the CSRobjectives and policies as laid down in this report. The CSR Committee of the Board isresponsible for the integrity and the objectivity of all the information provided in thedisclosure above. All the projects reported have been considered and undertaken with thebest of our intentions to contribute to the greater good of the society. We haveundertaken and implemented these projects with careful consideration and these projectsare aligned with our vision as provided in our CSR Policy. In line with the requirementsof the Companies Act 2013 we have also instituted monitoring mechanisms to ensure theprojects go on smoothly as planned.
Form No. MGT 9
Extract of Annual Return
As on financial year ended on 31.12.2019
Pursuant to Section 92 (3) of the Companies Act 2013 and rule 12(1) of the Company
(Management & Administration) Rules 2014.
|I. Registration & Other Details: || || |
|1 CIN ||L72900MH1992PLC069662 || |
|2 Registration Date ||20/11/1992 || |
|3 Name of the Company ||HEXAWARE TECHNOLOGIES LIMITED || |
|4 Category/Sub-category of the Company ||Company Limited by Shares / Indian Non-Government Company || |
|5 Address of the Registered office & contact details ||152 Millenium Business Park Sector 3rd A' Block TTC Industrial Area Mahape Navi Mumbai 400710 || |
| ||Tel: +91 22 4159 9595 || |
| ||Fax: +91 22 41599578 || |
| ||www.hexaware.com || |
| ||Email id: Investori@hexaware.com || |
|6 Whether listed company ||Yes || |
|7 Name Address & contact details of the Registrar & Transfer Agent if any. ||KFin Technologies Private Limited || |
| ||Unit: Hexaware Technologies Limited || |
| ||Corporate office: ||Investor Relation Centre: |
| ||Karvy Selenium Tower B Plot 31-32 ||24 B Rajabahadur Mansion |
| ||Gachibowli ||Ground Floor Amabalal Doshi Marg |
| ||Financial District Hyderabad - 500 032 ||Fort Mumbai 400 023 |
| ||Contact details: ||Tel: 022 66235454 |
| ||Tel: +91 40 67162222 ||Email: email@example.com |
| ||Fax number: +91 40 23420814 ||Website: www.kfintech.com |
| ||Email: firstname.lastname@example.org || |
| ||Website: www.kfintech.com || |
II. Principal Business Activities of the Company
(All the business activities contributing 10 % or more of the total turnover of thecompany shall be stated)
|SN. Name and Description of main products / services ||NIC Code of the Product/service ||% to total turnover of the company |
|1 Computer Programming Consultancy and Related Activities ||620 ||100 |
III. Particulars of Holding Subsidiary and Associate Companies
|SN. Name and address of the Company ||CIN/GLN ||Holding/ Subsidiary/ Associate ||% of shares held ||Applicable Section |
|1 HT Global IT Solutions Holdings Limited 3rd Floor 335 NeXTeracon Tower 1 Cybercity Ebene Mauritius. ||Foreign Company ||Holding ||62.44 ||2(46) |
|2 Hexaware Technologies Inc. 101 Wood Avenue South Suite 600 Iselin New Jersey 08830 USA ||Foreign Company ||Subsidiary ||100 ||2(87) |
|3 Hexaware Technologies GmbH Germany Mainzer Landstr . 33 60329 Frankfurt am Main Germany ||Foreign Company ||Subsidiary ||100 ||2(87) |
|4 Hexaware Technologies UK Limited Level 19 40 Bank Street Canary Wharf London E14 5NR ||Foreign Company ||Subsidiary ||100 ||2(87) |
|5 Hexaware Technologies Asia Pacific Pte. Limited 180 Cecil Street # 09-03 Bangkok Bank Building SINGAPORE 69546 ||Foreign Company ||Subsidiary ||100 ||2(87) |
|6 Hexaware Technologies Canada Limited 2 Robert Speck Parkway Suite 735 Mississauga ON L4Z 1H8. ||Foreign Company ||Subsidiary ||100 ||2(87) |
|7 Hexaware Technologies Mexico S de RL De CV Avenida San Angel # 240 Piso 3 Fracc. San Agustin Saltillo Coah. C.P. 25215 Mexico ||Foreign Company ||Subsidiary ||100 ||2(87) |
|8 Guangzhou Hexaware Information Technologies Company Limited Office 711 7/F Main Tower Guangdong International Building No.339 Huanshi Road East Yuexiu District Guangzhou 510098 China ||Foreign Company ||Subsidiary ||100 ||2(87) |
|9 Hexaware Technologies LLC Russian Fedreration170100 Tver Industrialnaya building 7 ||Foreign Company ||Subsidiary ||100 ||2(87) |
|10 Hexaware Technologies Romania SRL AFI Park 4 4A Timisoara Blvd. District 6 Bucharest 61328 Romania ||Foreign Company ||Subsidiary ||100 ||2(87) |
|11 Hexaware Technologies Saudi LLC P.O. Box No.: 30024 Kingdom of Saudi Arabia Office No. 406 - A Al Olaya Mazaya Tower Riyadh ||Foreign Company ||Subsidiary ||100 ||2(87) |
|12 Hexaware Technologies Hong Kong Limited RM 1906 19/F LEE Garden One 33 Hysan Avenue Causeway Bay Hong Kong ||Foreign Company ||Subsidiary ||100 ||2(87) |
|13 Hexaware Technologies Nordic AB HMR Redovisning AB Tellusvagen 5A 186 36 Vallentuna Stockholm Sweden ||Foreign Company ||Subsidiary ||100 ||2(87) |
|14 Hexaware Information Technologies (Shanghai) Company Limited Room 202 Block 1 No.255 Meisheng Road China (Shanghai) Free Trade Area ||Foreign Company ||Subsidiary ||100 ||2(87) |
|15 Mobiquity Inc 51 Sawyer Road Suite 410 Waltham Massachusetts ||Foreign Company ||Subsidiary ||100 ||2(87) |
|16 Mobiquity Velocity Solutions Inc 51 Sawyer Road Suite 410 Waltham Massachusetts ||Foreign Company ||Subsidiary ||100 ||2(87) |
|17 Mobiquity Cooperatief UA Barbara Strozzilaan 300 1083 HN Amsterdam ||Foreign Company ||Subsidiary ||100 ||2(87) |
|18 Mobiquity BV Barbara Strozzilaan 300 1083 HN Amsterdam ||Foreign Company ||Subsidiary ||100 ||2(87) |
|19 Morgan Clark BV Barbara Strozzilaan 300 1083 HN Amsterdam ||Foreign Company ||Subsidiary ||100 ||2(87) |
|20 Hexaware Technologies South Africa (PTY) Ltd 13th Floor Pier Place 31 Heerengracht Street Cape Town 8001 South Africa ||Foreign Company ||Subsidiary ||100 ||2(87) |
|21 Mobiquity Softech Private Limited 5th Floor Tower B Privilon B/H Iskon Temple Ambli Brt Road Ahmedabad 380059 ||U72200GJ2010PTC062188 ||Subsidiary ||100 ||2(87) |
|22 Experis Technology Solutions PTE LTD 10 HOE Chiang Road # 21 - 04/05 Keppel Towers Singapore 089315 ||Foreign Company ||Associate ||20 ||2(6) |
IV. Share Holding Pattern
(Equity share capital breakup as percentage of total equity)
(i) Category-wise Share Holding
| ||No. of Shares held at the beginning of the year [As on 01-01-2019] ||No. of Shares held at the end of the year [As on 31-12-2019] || |
|Category of Shareholders ||Demat ||Physical ||Total ||% of Total Shares ||Demat ||Physical ||Total ||% of Total Shares ||% Change during the year |
|A. Promoters || || || || || || || || || |
|(1) Indian || || || || || || || || || |
|a) Individual/ HUF ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|b) Central Govt ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|c) State Govt(s) ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|d) Bodies Corp. ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|e) Banks / FI ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|f) Any other ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|Sub Total (A) (1) ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|(2) Foreign || || || || || || || || || |
|a) NRI Individuals ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|b) Other Individuals ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|c) Bodies Corp. ||186318590 ||- ||186318590 ||62.66% ||186318590 ||- ||186318590 ||62.44% ||0.00% |
|d) Any other ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|Sub Total (A) (2) ||186318590 ||- ||186318590 ||62.66% ||186318590 ||- ||186318590 ||62.44% ||0.00% |
|TOTAL (A) ||186318590 ||- ||186318590 ||62.66% ||186318590 ||- ||186318590 ||62.44% ||0.00% |
|B. Public Shareholding || || || || || || || || || |
|1. Institutions || || || || || || || || || |
|a) Mutual Funds ||32008164 ||3920 ||32012084 ||10.77% ||34607745 ||3920 ||34611665 ||11.60% ||1.62% |
|b) Banks / FI ||417539 ||2320 ||419859 ||0.14% ||122710 ||2320 ||125030 ||0.04% ||-0.10% |
|c) Central Govt ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|d) State Govt(s) ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|e) Venture Capital Funds ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|f) Insurance Companies || ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|g) FIIs ||51083223 || ||51083223 ||17.18% ||50637106 || ||50637106 ||16.97% ||-0.21% |
|h) Foreign Venture Capital Funds ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|i) Alternate Investment fund ||90595 || ||90595 ||0.03% ||- || ||- ||0.00% ||-0.03% |
|j) Others ||25 ||- ||25 ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|Sub-total (B)(1):- ||83599546 ||6240 ||83605786 ||28.12% ||85367561 ||6240 ||85373801 ||28.61% ||1.28% |
|2. Non-Institutions || || || || || || || || || |
|a) Bodies Corp. || || || || || || || || || |
|i) Indian ||3794342 ||8912 ||3803254 ||1.28% ||2952684 ||8072 ||2960756 ||0.99% ||0.22% |
|ii) Overseas ||10 ||0 ||10 ||0.00% ||10 ||0 ||10 ||0.00% ||0.00% |
|b) Individuals || || || || || || || || || |
|i) Individual shareholders holding nominal share capital upto H1 lakh ||15266513 ||2039637 ||17306150 ||5.82% ||15194329 ||1781284 ||16975613 ||5.69% ||-0.21% |
|ii) Individual shareholders holding nominal share capital in excess of H1 lakh ||1835436 ||0 ||1835436 ||0.62% ||2073035 ||0 ||2073035 ||0.69% ||0.07% |
|c) Others (specify) || || || || || || ||- || || |
|Non Resident Indians ||2462607 ||143995 ||2606602 ||0.88% ||2689673 ||121390 ||2811063 ||0.94% ||0.13% |
|Overseas Corporate Bodies ||- ||- ||- ||0.00% ||- ||- ||- ||0.00% ||0.00% |
|Foreign Nationals ||6000 ||- ||6000 ||0.00% ||6000 ||0 ||6000 ||0.00% ||0.00% |
|Clearing Members ||238743 ||0 ||238743 ||0.08% ||173157 ||0 ||173157 ||0.06% ||-0.02% |
|Trusts ||40795 ||0 ||40795 ||0.01% ||18480 ||0 ||18480 ||0.00% ||-0.01% |
|IEPF ||1599623 ||- ||1599623 ||0.54% ||1673816 ||- ||1673816 ||0.56% ||0.06% |
|Foreign Bodies - D R || || ||- ||0.00% || || ||- ||0.00% ||0.00% |
|Sub-total (B)(2):- ||25244069 ||2192544 ||27436613 ||9.23% ||24781184 ||1910746 ||26691930 ||8.95% ||-0.28% |
|Total Public (B) ||108843615 ||2198784 ||111042399 ||37.34% ||110148745 ||1916986 ||112065731 ||37.56% ||0.22% |
|C. Shares held by Custodian for GDRs & ADRs || || || || || ||- || ||0.00% ||0.00% |
|Grand Total (A+B+C) || ||295162205 ||2198784 ||297360989 ||100.00% ||296467335 ||1916986 ||298384321 ||100.00% |
(ii) Shareholding of Promoter
| ||Shareholding at the beginning of the year ||Shareholding at the end of the year || |
|Shareholder's Name ||No. of Shares ||% of total Shares of the company ||% of Shares Pledged/ encumbered to total shares ||No. of Shares ||% of total Shares of the company ||% of Shares Pledged / encumbered to total shares ||% change in shareholding during the year |
|HT GLOBAL IT SOLUTIONS HOLDINGS LIMITED ||186318590 ||62.66% ||0 ||186318590 ||62.44% ||0 ||0.00% |
(iii) Change in Promoters' Shareholding (please specify if there is no change)
| ||Shareholding at the beginning of the year ||Increase/ Decrease in Shareholding ||Cumulative Shareholding during the year |
|Particulars ||No. of shares ||% of total shares of the company ||Date ||Reason ||No. of Shares ||% total shares of the Company ||No. of shares ||% of total shares of the company |
|At the beginning of the year ||186318590 ||62.66 || || || || || || |
|Date wise Increase/Decrease in Promoters Share holding during the year specifying the reasons for increase/decrease (e.g. allotment/transfer/bonus/sweat equity etc): ||NIL ||NIL ||NIL ||NIL ||NIL ||NIL ||NIL ||NIL |
|At the end of the year ||186318590 ||62.44 || || || || ||186318590 ||62.44 |
(iv) Shareholding Pattern of top ten Shareholders
(Other than Directors Promoters and Holders of GDRs and ADRs):
|For each of the Top 10 shareholders || |
Shareholding at the beginning of the year (01-01-2019)
Shareholding at the end of the year (31-12-2019)
|Name of Shareholder ||No. of Shares ||% of the total Shares ||No. of Shares ||% of the total Shares |
|1 HDFC TRUSTEE COMPANY LTD ||19274031 ||6.48 ||19927531 ||6.68 |
|2 T. ROWE PRICE INTERNATIONAL DISCOVERY FUND ||6662556 ||2.23 ||6662556 ||2.23 |
|3 INVESCO TRUSTEE PRIVATE LIMITED ||2382673 ||0.8 ||4344669 ||1.46 |
|4 SBI MAGNUM MIDCAP FUND ||73717 ||0.02 ||3814251 ||1.28 |
|5 NTASIAN EMERGING LEADERS MASTER FUND ||2871477 ||0.96 ||2871477 ||0.96 |
|6 FRANKLIN INDIA EQUITY SAVINGS FUND ||139500 ||0.05 ||2571906 ||0.86 |
|7 PICTET - INDIAN EQUITIES ||o ||0 ||2202837 ||0.74 |
|8 HDFC STANDARD LIFE INSURANCE COMPANY LIMITED ||2529585 ||0.85 ||2202700 ||0.74 |
|9 RELIANCE CAPITAL TRUSTEE CO LTD ||829500 ||0.28 ||1712658 ||0.57 |
|10 INVESTOR EDUCATION AND PROTECTION FUND AUTHORITY MINISTRY OF CORPORATE AFFAIRS ||1599623 ||0.54 ||1673816 ||0.56 |
The details of datewise increase / decrease in Shareholding of top ten Shareholders isavailable on Company's website at www.hexaware.com
(v) Shareholding of Directors and Key Managerial Personnel:
|SN. Shareholding of each Directors and each Key Managerial Personnel || || || |
Shareholding at the beginning of the year
Cumulative Shareholding during the year
| ||Date ||Reason ||No. of shares ||% of total shares ||No. of shares ||% of total shares |
|1 ATUL KANTILAL NISHAR || || || || || || |
|At the beginning of the year ||01.01.2019 || ||1000 ||0.00% ||1000 ||0.00% |
|Changes during the year || || || ||0.00% || ||0.00% |
|At the end of the year ||31.12.2019 || || ||0.00% ||1000 ||0.00% |
Key Managerial Personnel
|Shareholding of each Directors and each Key Managerial Personnel || || || |
Shareholding at the beginning of the year
Cumulative Shareholding during the year
| ||Date ||Reason ||No. of shares ||% of total shares ||No. of shares ||% of total shares |
|1 R Srikrishna* || || || || || || |
|At the beginning of the year ||01.01.2019 ||shares issued on exercise of RSU ||500000 || ||500000 ||0.17% |
|Changes during the year ||03.01.2019 || ||150000 ||0.05% || || |
|At the end of the year ||31.12.2019 || || || ||650000 ||0.22% |
|2 GUNJAN SUMIT METHI || || || || || || |
|At the beginning of the year ||01.01.2019 || ||7426 ||0.00% ||7426 ||0.00% |
|Changes during the year || || || || || || |
|At the end of the year ||31.12.2019 || || ||0.00% ||7426 ||0.00% |
Indebtedness of the Company including interest outstanding/accrued but not due forpayment.
| || || || ||(Rs. Million) |
|Particulars ||Secured Loans excluding deposits ||Unsecured Loans ||Deposits ||Total Indebtedness |
|Indebtedness at the beginning of the financial year || || || || |
|i) Principal Amount ||NIL ||NIL ||NIL ||NIL |
|ii) Interest due but not paid ||NIL ||NIL ||NIL ||NIL |
|iii) Interest accrued but not due ||NIL ||NIL ||NIL ||NIL |
|Total (i+ii+iii) ||- ||- ||- ||- |
|Change in Indebtedness during the financial year || || || || |
|* Addition ||NIL ||NIL ||NIL ||NIL |
|* Reduction ||NIL ||NIL ||NIL ||NIL |
|Net Change ||- ||- ||- ||- |
|Indebtedness at the end of the financial year || || || || |
|i) Principal Amount ||NIL ||NIL ||NIL ||NIL |
|ii) Interest due but not paid ||NIL ||NIL ||NIL ||NIL |
|iii) Interest accrued but not due ||NIL ||NIL ||NIL ||NIL |
|Total (i+ii+iii) ||- ||- ||- ||- |
Above does not include borrowings taken by a subsidiary company in the form of termloan of US$ 20 million. During the year the said subsidiary had also borrowed and repaidin full the working capital loan.
VI. Remuneration of Directors and Key Managerial Personnel
A. Remuneration to Managing Director Whole-time Directors and/or Manager:
| || ||(Rs. Million) |
|Particulars of Remuneration ||Name of MD/WTD/ Manager ||Total Amount |
|Name ||R Srikrisna || |
|Designation ||CEO & Executive Director || |
|1 Gross salary || || |
|(a) Salary as per provisions contained in section 17(1) of the Income-tax Act 1961 ||5.16 ||5.16 |
|(b) Value of perquisites u/s 17(2) Income-tax Act 1961 ||- ||- |
|(c) Profits in lieu of salary under section 17(3) Income- tax Act 1961 ||- ||- |
|2 Stock Option* ||52.33 ||52.33 |
|3 Sweat Equity ||- ||- |
|4 Commission ||- ||- |
|- as % of profit ||- ||- |
|- others specify ||- ||- |
|5 Others please specify ||- ||- |
|Total (A) ||57.49 ||57.49 |
|Ceiling as per the Act || || |
- Above does not include remuneration of H83.76 million paid by overseas subsidary of the Company.
- *The Cost computed and amortised over vesting period as per Ind AS 102 Share Based Payment
B. Remuneration to other Directors
| || || || ||(Rs. Million) |
|Particulars of Remuneration ||Fee for attending board and committee meetings ||Commission ||Others please specify ||Total Amount |
|Independent Directors || || || || |
|1 Bharat D Shah ||0.30 ||5.58 ||- ||5.88 |
|Dileep C Choksi ||0.18 ||5.58 ||- ||5.76 |
|Basab Pradhan ||0.16 ||3.03 ||- ||3.19 |
|Christian T Oecking ||0.16 ||3.37 ||- ||3.52 |
|Meera Shankar ||0.30 ||7.08 ||- ||7.38 |
|P R Chandrasekar ||0.38 ||7.08 ||- ||7.46 |
|Total (1) ||1.48 ||31.72 ||- ||33.20 |
|2 Other Non-Executive Directors || || ||- ||- |
|Kosmas Kalliarekos ||- ||- ||- ||- |
|Jimmy L Mahtani ||- ||- ||- ||- |
|Atul Kantilal Nishar ||- ||- ||- ||- |
|Total (2) ||- ||- ||- ||- |
|Total (B)=(1+2) ||1.48 ||31.72 || ||33.20 |
|Total Managerial Remuneration ||- ||- ||- ||90.69 |
|Overall Ceiling as per the Act [u/s 197(1) (i) ] || || || ||684.50 |
C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD
| || || ||(Rs. Million) |
|Particulars of Remuneration ||Name of Key Managerial Personnel || |
|Name ||Vikash Kumar Jain ||Gunjan Methi ||Total Amount |
|Designation ||CFO ||CS || |
|1 Gross salary || || || |
|(a) Salary as per provisions contained in section 17(1) of the Income-tax Act 1961 ||17.64 ||2.41 ||20.05 |
|(b) Value of perquisites u/s 17(2) Income-tax Act 1961 ||- ||- ||- |
|(c) Profits in lieu of salary under section 17(3) Income- tax Act 1961 ||- ||- ||- |
|2 Stock Option** ||- ||- ||- |
|3 Sweat Equity ||- ||- ||- |
|4 Commission ||- ||- ||- |
|- as % of profit ||- ||- ||- |
|- others specify ||- ||- ||- |
|5 Others please specify ||- ||- ||- |
|Total ||17.64 ||2.41 ||20.05 |
VII. Penalties / Punishment/ Compounding of Offences:
There were no penalties or punishments levied on the Company under the provisions ofCompanies Act 2013 and rules made there under during the year. Also there was nonecessity for the Company to compound any offence.