To the Members
The Directors have pleasure in presenting the 33rd Annual Report and Audited Accountsfor the financial year ended 31st March 2018.
|PARTICULARS ||Standalone ||Consolidated |
| ||2017-2018 ||2016-2017 ||2017-2018 ||2016-2017 |
|Gross Sales and Services ||28639485 ||36000000 ||6475737425 ||2637690668 |
|Other Income ||2939650 ||1937284 ||91918865 ||65639448 |
|Profit/(Loss) before depreciation finance charges and taxation ||1153918 ||7801472 ||63104570 ||295894520 |
|Less: Depreciation & Amortisation expenses ||62217 ||152785 ||44930386 ||134335694 |
|Less: Finance Charges ||9615 ||1480 ||51642970 ||56585627 |
|Profit before Exceptional items and Tax ||1082086 ||7647207 ||(33468786) ||104973199 |
|Less: Exceptional items ||213981202 ||- ||314345200 ||- |
|Profit/(Loss) before taxes ||(212899116) ||7647207 ||(347813986) ||104973199 |
|Less: Tax Expenses || || || || |
|Current tax ||327118 ||2367309 ||909776 ||2422987 |
|Deferred tax ||(145989) ||219024 ||767337 ||1435418 |
|Profit/ (Loss) for the year after tax ||(213080245) ||5060874 ||(349491099) ||101114794 |
In view of loss incurred by the company during the year under review the Board ofDirectors do not recommend any dividend on Equity Shares of the Company.
MANAGEMENT DISCUSSIONS & ANALYSIS (MDA)
The Standalone gross turnover during the financial year ended 31st March 2018 stood atRs.28639485/- as against the Standalone gross turnover of Rs.36000000/- in theprevious financial year ended 31st March 2017. During the financial year ended 31stMarch 2018 the Company has incurred a loss of Rs.213080245/- due to an exceptionalitem as compared to profit of Rs.5060874/- in the previous year ended 31st March 2017on standalone basis. The Consolidated gross turnover during the financial year ended 31stMarch 2018 stood at 6475737425/- as against the Consolidated gross turnover ofRs.2637690668/- in the previous financial year ended 31st March 2017. During thefinancial year ended 31st March 2018 the Company has incurred a loss ofRs.349491099/- as compared to profit of Rs.101114794/- in the previous year ended31st March 2017 on consolidated basis.
During the financial year 2017-18 the paid up capital of the Company stood at Rs.1132742219/- (Rupees One Hundred Thirteen Crore Twenty Seven Lacs Forty Two ThousandTwo Hundred Nineteen Only) divided into 1132742219 Equity Shares of Re. 1/- each.
INDUSTRY OVERVIEW FOR THE COMPANY & ITS SUBSIDIARIES
1. MOBILE HANDSETS MARKET IN INDIA
One of the subsidiaries of the Company nexG Devices Private Limited (NDPL) is engagedinto trading of mobile handsets business in India.
Mobile Handset Market Overview
According to CMR's India Quarterly Mobile Handset Market Review Q4' CY 2017 mobilehandset vendors shipped 88 million mobile handset units in 4Q 2017.
For the entire year mobile handset vendors have shipped around 287 million mobilehandset units in India. The smartphone market recorded a 19% sequential decline in 4Q2017 with 30 million units shipped. The feature phone market on the other handwitnessed a 36% sequential growth in 4Q 2017 and YoY growth of 62%.
Traditionally December is a lean period. However 4Q 2017 bucked this trend. From thethroes of demonetization at the beginning of 2017 the India mobile handset market toucheda new historic high in OND'2017. If one were to look at historic trends the India mobilehandset market usually sees high refresh cycles in May-June coinciding with the collegeadmission season and in September-October owing to the festive season.
2017 was remarkable with certain pioneering mobile handset brands like HTC Asus andGionee among others seeing worrisome warning signals while a new breed of excitinghandset brands like Comio and NUU Mobile among others came to the fore. As per CMRthis trend will deepen further in 2018. LYF's JioPhone was major growth driver for 4QCY2017. Its shipments grew more than five-fold in 4Q. This new trend led to surge inmarket share of feature phones. With local manufactured JioPhones hitting the market incoming quarters the vendor is expected to better its performance as per CMR. Insmartphones Xiaomi became the clear market leader on the back of its growing offlinepenetration and value for money products. CME is expecting to witness revival in onlinestrategy of Samsung along with its enhanced focus on enterprise business and Appgets.
As per CMR 2018 will continue to witness growth of entry-level smartphones which willlargely cater to first time smartphone buyers. Aggressive pre-paid 4G entry level planslaunched by telcos in 1Q 2018 will further accelerate the adoption of 4G.
CMR 4Q Brand Leaderboard
In feature phones LYF scaled a new high emerging as the market leader with 27%market share followed by Samsung with 14% market share.
In smartphones Xiaomi emerged as the market leader with 25% market sharefollowed by Samsung with 23% market share.
YoY Market Movement Trends
Winners and Losers: According to CMR Mobile Handset Report major Chinese brandssaw exceedingly healthy year-on-year growth. On the other hand some pioneering brands sawtheir growth decline. For them 2018 will be a challenging year. (Source: CMR's IndiaMobile Handsets Market Review Feb 2018 release athttp://cmrindia.com/india-mobile-handset-market-touches-historic-high-4q-2017/)
2. MOBILE TELEVISION OR MOBILE VIDEO STREAMING BUSINESS
One of the wholly owned subsidiaries of the Company DigiVive Services Private Limited(DSPL) is engaged into mobile video streaming services in India.
Mobile Video Streaming Industry Overview
Globally video consumption has grown rapidly to make it one of the largest categorieson PC-Internet. Mobile has also begun to play a significant role in video consumptionacross the world with over 15% of the total video consumption already moving towardsmobile devices in countries like Japan and UK. In the US most players in the top tenoffer free ad-supported videos through varying business models.
Like music industry video industry is also observing shift towards digital formats.Traditionally the highest video consumption has been happening on TV; however with thefaster growing internet penetration and access to multimedia devices more and more timeis being spent on consuming digital videos. The traditional form of TV viewership isgiving way to the new segment of consumers who are choosing to consume multimedia contenton-demand. This has led to a sharp increase in video traffic consumption.
Key Players in Mobile Video Streaming Industry
While players like YouTube and Vuclip have developed a strong position in the onlinevideo distribution market in India a significant quantum of local Indian content stillremains to be digitized. This presents a large opportunity for local players who can builda differentiated position on the basis of their content catalogues. Paid premium videos inIndia originated from telcos who offered mobile TV services to their consumers through asubscription model. The key players in the industry include Yupp TV Voot Netflix AmazonPrime nexGTv Sony LIV Ditto TV Hotstar (a venture by Star group) EROS Now and Spuul(focused only on movies) and Zenga TV. Beside there are players like ALT Balaji thatapart from their movie catalogue is focusing on original web series. Then there's HOOQthe Singapore-based video streaming company that solely focuses on Hollywood content andit launched in India a couple of years ago and went into oblivion. But recently thecompany announced a revamp of its service and now allows users to stream movies and TVshows at an introductory price of Rs. 89 (US$1.36) for the first three months. HOOQ hasalso introduced Transactional Video-on-demand (TVOD) allowing users to rent content on apay-per-view basis like Hollywood movies after 90 days cinema release.
Business Model in Mobile Video Streaming Industry
There are three types of business models which have been successful in the videos space- Ad-supported user generated content Ad-supported premium content and Paid premiumcontent. Freemium models also exist where a part of the content is offered for free(generally ad-supported) and the remaining part is offered for a fee.
Players like Netflix and Amazon are expected to both pave the way for paid content inIndia and also benefit from the tailwinds that are driving the subscription model. So farthere have been three main barriers to this subscription model. 1) The mindset: At a basicmonthly package of around USD $ 3 cable TV is cheaper in India than in most places aroundthe world. The average Indian consumer doesn't like paying extra (beyond cable) forcontent that is delivered at home. They are willing to pay extra for content only if it ispart of an experience - like an outing to a movie theatre. 2) High data costs: & 3)Limited options and low adoption of online payments.
These barriers are now reducing. The aggressive launch of telecom service providerReliance Jio in September 2016 has shaken up Indian telecom sector and is resulting inlowering data prices and making it affordable and accessible. In the KPMG India -FICCI2017 report as per Nielsen estimates the average time spent by an individual onstreaming videos has increased nearly nine times from two minutes a day in Q2 2014 to 18minutes a day in Q4 2016. After the demonetization exercise in November 2016 and the pushtowards a less-cash society online payment is gaining traction. There is also increasingawareness and growing popularity of online video and consumers are opening up to the ideaof paying for original and exclusive content and for immediacy. The entry of Netflix andAmazon is both a challenge and boon for industry. It creates a proof of concept and opensa brand new category - of people willing to pay for content.
Voot currently has 17 million users and is ad-based focused with over 120 brandsadvertising on its platform and is looking to introduce a subscription model shortly. Wehave to be mindful of both models and see how it all plays out. It's an emerging space andplayers are all at learning stage at present. A bundling of data and content could helpplayers to unlock the value of the subscription model. Based on the current industrydynamics "a model which can support a gradual shift from AVOD (advertisement-ledvideo on demand) to SVOD (subscription-led) and TVOD (transaction-led) will survive in thelonger run. Also how effectively AVOD models can be put into play would depend largely onhow better targeted advertising can be created by analyzing individual consumer behaviorsthrough appropriate data mining. Video streaming can't be profitable purely on an ad-ledmodel.
Key Trends in Mobile Video Streaming Industry
Indians' appetite for binge-watching online videos is set to make the country among thetop 10 OTT (Over the Top) video market in the world in next four year. With major OTTplayers Netflix Hotstar Amazon Prime pushing deeper into people living rooms OTTvideo market in India is growing at CAGR of around 23% as per data revealed by PwC.
OTT revenue in India has been pegged at Rs. 2019 Crore in 2017 and is expected to reachRs. 5595 crore by 2022 as per PwC report quoted in the TOI article. The growing rivalryamong the international and regional subscription video on demand (SVOD) platforms isevident with 70% of the revenue in 2017 attributable to subscription services. An exampleof standalone SVOD services delivered over the open internet is Netflix. In contrastHotstar follows a hybrid subscription model where some programs are free and some arechargeable. As per PwC this trend is expected to be continued and by 2022 79.4% of thetotal market revenue is expected to be from SVOD. With Indian economy surging past atrapid pace customers personal and professional life are getting busier travel is gettinglonger and technology is becomingsimpler.(Source:http://timesofindia.indiatimes.com/articleshow/64488591.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst)
Opportunities and Outlook
The strategy of Company and/or its subsidiaries has been towards investing in the newapplication and/or technologies related to Mobile on account of rising demand for dataservices/solution in 3G/4G era and making investments in next generation businessesincluding Contents Telecom and Media businesses which are expected to have substantialgrowth over the next decade on account of rising demand from online and e-commercebusinesses. The Company would be working either directly or through its subsidiaries totake up existing and/or new projects to achieve the above.
Risks Threat & Concern
The Company and/or its subsidiaries operates in a competitive environment and facescompetition from both the international as well as domestic players and within domesticindustry from both the organized and unorganized players. However no player in theindustry is an integrated player.
Adequacy of Internal Control
The Company has a well laid internal control system commensurate with size of theCompany. M/s Sunder Sharma & Company Chartered Accountant (FRN No.008629N) are theinternal auditors of the Company. The internal control system is so designed to ensurethat there is adequate safeguard maintenance and usage of assets of the Company.
Internal Financial Controls related to Financial Statements
Your Company has put in place adequate Internal Financial Controls with reference tothe financial statements some of which are outlined below. Your Company has adoptedaccounting policies which are in line with the Accounting Standards prescribed in theCompanies (Accounting Standards) Rules 2006 that continue to apply under Section 133 andother applicable provisions if any of the Companies Act 2013 read with Rule 7 of theCompanies (Accounts) Rules 2014. These are in accordance with generally acceptedaccounting principles in India. Changes in policies if any are approved by the AuditCommittee in consultation with the Statutory Auditors.
The policies to ensure uniform accounting treatment are prescribed to the subsidiariesof your Company. The accounts of the subsidiary companies are audited and certified bytheir respective Statutory Auditors for consolidation.
Your Company in preparing its financial statements makes judgments and estimates basedon sound policies and uses external agencies to verify/ validate them as and whenappropriate. The basis of such judgments and estimates are also approved by the StatutoryAuditors and Audit Committee.
The Management periodically reviews the financial performance of your Company againstthe approved plans across various parameters and takes necessary action wherevernecessary.
The management periodically briefs the Board on the emerging risks along with the riskmitigation plans put in place. Risk management is interlinked with the annual planningexercise where each function and business carries out a fresh risk identificationassessment and draws up treatment plans.
There are no risk which in the opinion of the Board threaten the existence of theCompany.
The Company currently has a technical team with experience in developing newapplications and technologies required for supporting the Mobile Content distributionplatform and we would like to thank each and every member of the MMWL family itsSubsidiaries for their role and continuous contribution towards the Company's performance.The Company had 6 (six) employees on its roll as on 31st March 2018.
Pursuant to share purchase agreement signed on 2nd August 2017 and approval of theshareholders of the Company obtained through postal ballot on 26th August 2017 theCompany had divested its entire stake in DigiCall Teleservices Private Limited("DTPL") to Karvy Data Management Services Limited ("KDMSL") andtransferred operational control of DTPL to KDMSL w.e.f. 1st July 2017. Accordingly (i)DTPL has ceased to be a wholly owned subsidiary of the Company w.e.f 1st July 2017 and(ii) DigiCall Global Private Limited a wholly owned subsidiary of DTPL and a step downsubsidiary of the Company has also ceased to be a subsidiary of the Company w.e.f. 1stJuly 2017. 47599900 equity shares of Rs.10/-each held by Company and 6900100 equityshares held by Media Matrix Enterprises Private Limited a wholly owned subsidiary of theCompany in DTPL have been transferred in favor of KDMSL on 5th September 2017.
nexG Devices Private Limited (NDPL)
Our Subsidiary NDPL has rich experience in procurement and distribution of MobileHandsets of various brands. NDPL has distribution arrangement with various brands fordistribution and marketing of handsets in the Indian markets. NDPL has marketing officesand warehouses located at various cities in India and over a period of time it hasestablished a nationwide network to handle the distribution business all over India.
With the launch of 4G services mainly by Reliance Jio this market has expanded veryfast and is going to expand manifold in future as well and will have more opportunitiesfor NDPL having a strong presence with warehouses across the country. NDPL is currentlydoing business with Gionee VIVO and Tecno. mobile brands to distribute mobile handsets toLFRs (Large Format Retail outlets) across the country.
NDPL is in the process of further tie-ups with renowned brands by leveraging itslogistics warehousing & distribution expertise across the country.
DigiVive Services Private Limited (DSPL)
DSPL is in the business of running next generation mobile video OTT streaming services.It is running an OTT service "nexGTv" since May 2011. nexGTv offers a bouquet ofover 150 Television channels to its current subscriber base of around 5 Lakh+ customersand the nexGTv app has been downloaded by more than 25 million users from the various appstores. NexGTv also has a large VOD library of Tv content and movies. The deliverymechanisms for nexGTv include Native Client Website Mobile WAP browsers. Further DSPLhas also entered into offering Multiscreen solutions for Direct To Home (DTH) Industry andhas tied up with two large DTH players in the country.
After the entry of Reliance Jio in India followed by new set of OTT players steppinginto the market nexGTv completely redesigned the product and re-launched. Earlier theirproduct was only for Indian audience and after this it was available all over the world.
A number of OTT video service providers such as Vuclip Hotstar Voot Amazon PrimeNetflix etc emerged in the market by 2016. They were all major players in theinternational market and invested heavily in the Indian market. They saw huge potentialfor growth as India was a growing market both in terms of better network connectivity andincrease in the audience for OTT video services. Content was definitely the topmost agendafor them as they had reportedly set aside huge budget exclusively for acquiring content inIndia. Not only the content but other players invested hugely in understanding andconnecting to the audience through online and offline marketing & advertisement.
Though this sector has a high rate of growth but is constrained by requirement ofregular high level of capital investment. The market is getting more competitive becauseof launch of cost effective content streaming services by large players like Reliance JioHotStar etc . nexGTv has been a strong contender in this segment in the past but isgradually losing market share due to the challenges posed by large new players with theirbetter content offerings huge investments requirement and big marketing budgets. In viewof above the management was exploring the options to either go for consolidation or fordivesting stake to some strategic player to create long term value proposition for itsshareholders.
The Company on August 13 2018 has signed the Share Purchase Agreement to divest itsentire stake in DigiVive Services Private Limited (DSPL) a wholly owned subsidiary of theCompany at a consideration of Rs.10 crore i.e. book value of the investment to InfotelBusiness Solutions Limited pursuant to which DSPL will cease to be a wholly ownedsubsidiary of the Company. The aforesaid transaction will be completed on or before 30thSeptember 2018.
Media Matrix Enterprises Private Limited
Media Matrix Enterprises Private Limited (formerly Media Matrix Holdings PrivateLimited) is engaged in business of making investments in existing/new projects to beundertaken by us jointly or severally.
CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of your Company for the financial year 2017-18are prepared in accordance with the provision of the Companies Act 2013 read with theRules issued thereunder Accounting Standard AS -21 on Consolidated Financial Statementsread with AS-23 on Accounting for Investments in Associates AS -27 on Financial Reportingof Interests in Joint Ventures and the provisions of the Listing Regulations. The AuditedConsolidated Financial Statement is provided in the Annual Report.
Subsidiaries Joint Ventures and Associate Companies
A separate statement containing the salient features of financial statements of allsubsidiaries of your Company forms part of Consolidated Financial Statements in compliancewith Section 129 and other applicable provisions if any of the Companies Act 2013. Thefinancial statements of the subsidiary companies and related information are available forinspection by the members at the Registered Office of your Company during business hourson all days except Saturdays Sundays and public holidays up to the date of the AnnualGeneral Meeting (AGM) as required under Section 136 of the Companies Act 2013. Anyshareholder desirous of obtaining the Annual Accounts and related information of the abovesubsidiary companies may write to the Company Secretary at M/s Media Matrix Worldwide Ltd.Plot No. 38 4th Floor Sector 32 Institutional Area Gurgaon 122001 Haryana and the sameshall be sent by post. The financial statements including the consolidated financialstatements financial statements of subsidiaries and all other documents required to beattached to this report have been uploaded on the website of the Company i.e.www.mmwlindia.com.
A report on the performance and financial position of each of subsidiaries associatesand joint venture companies as per the Companies Act 2013 is provided as "Annexure- A" to the consolidated financial statement and hence not repeated here for sakeof brevity. The policy for determining material subsidiaries as approved by the Board ofDirectors may be accessed on the Company's website at the link:http://www.mmwlindia.com/PDF/investors/Policy%20for%20determining%20material%20subsidiaries.pdf
During the financial year 2017-18 your Company has not accepted any deposit within themeaning of Section 73 and 74 of the Companies Act 2013 read together with the Companies(Acceptance of Deposits) Rules 2014.
DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS KEY MANAGERIAL PERSONNEL (KMPs) ANDPARTICULARS OF EMPLOYEES
The remuneration paid to the Directors is in accordance with the Remuneration Policyformulated in accordance with Section 178 of the Companies Act 2013 (including anystatutory modification(s) or re-enactment(s) for the time being in force) and Regulation19 of the Listing Regulations. The salient aspects covered in the Remuneration Policy havebeen outlined in the Corporate Governance Report which forms part of this report.
The Whole-Time Director of your Company does not receive remuneration from any of thesubsidiaries of the Company. The information required under Section 197 of the CompaniesAct 2013 read with Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 in respect of Directors/employees of the Company is set out in "Annexure- A" to this Report and is available on the website of the Company.
DIRECTORS & KEY MANAGERIAL PERSONNELS APPOINTMENTS/RE-APPOINTMENTS/RESIGNATIONS
Shri Sandeep Jairath Whole-time Director cum Chief Financial Officer is liable toretire by rotation at ensuing Annual General Meeting pursuant to Section 152 of theCompanies Act 2013 read with the Companies (Appointment and Qualification of Directors)Rules 2014 and the Article of Association of your Company and being eligible offershimself for re-appointment. Appropriate resolution for his re- appointment is being placedfor your approval at the ensuing AGM. The Brief resume of him and other relatedinformation have been detailed in the Notice convening the 33rd AGM of the Company.
During the financial year 2017-18 the Board of Directors has appointed Shri SunilBatra as an Additional/Non- Executive Director w.e.f. 31st January 2018 subject to theapproval of shareholders at the ensuing AGM. Your directors recommend his appointment as aDirector of the Company.
Further the Board of Directors appointed Shri Aasheesh Verma as an Additional/Independent Director w.e.f 13th August 2018 for the term of 5 (five) years upto 12thAugust 2023 subject to the approval of shareholders at the ensuing Annual GeneralMeeting. Your Directors recommend his appointments.
Smt. Bela Banerjee shall complete her second term as an Independent Director and willcease to be Independent Director of the Company with the conclusion of ensuing AnnualGeneral Meeting.
However the Board of Directors of the Company on the recommendation of Nomination andRemuneration Committee at their meeting held on 13th August 2018 has appointed Smt. BelaBanerjee as Non-Executive Director of the Company w.e.f. 29th September 2018. Yourdirectors recommends her apointment as a Non-Executive Director of the Company.
Shri Bharat Bhushan Chugh has resigned from the Board of the Company and has ceased tobe a director of the company w.e.f 13th August 2018.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
The details of programmes for familiarisation of Independent Directors with theCompany their roles rights responsibilities in the Company and related matters are putup on the website of the Company at the link: http://mmwlindia.com/PDF/MMWL-Familiarisation-Prog-ID.pdf
ANNUAL EVALUATION OF BOARD PERFORMANCE
Pursuant to the provisions of the Companies Act 2013 read with the rules issuedthereunder Regulation 17(10) of the Listing Regulations and the circular issued bySecurities Exchange Board of India (SEBI) on 5th January 2017 with respect to guidancenote on Board Evaluation the evaluation of the annual performance of theDirectors/Board/Committees were carried out for the financial year 2017-18. The Details ofthe evaluation process are set out in Corporate Governance Report which form form part ofthe report.
KEY MANAGERIAL PERSONNEL
During the financial year ended 31st March 2018 Shri Sandeep Jairath Whole-timeDirector cum Chief Financial Officer and Shri Gurvinder Singh Monga Company Secretaryremained the Key Managerial Personnel in accordance with the provisions of the CompaniesAct 2013 and Rules made thereunder.
Shri Vineet Mittal has ceased to be a Chief Financial Officer of the Company w.e.f.29th August 2017.
Shri Sandeep Jairath was appointed as Whole-time Director cum Chief Financial Officerof the Company w.e.f. 29th August 2017.
PARTICULARS OF EMPLOYEES' AND RELATED DISCLOSURES
In terms of the provisions of Section 197(12) of the Companies Act 2013 read withRules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 (including any statutory modification(s) or re-enactment(s) thereoffor the time being in force) a statement showing the names of top ten employees of theCompany in terms of remuneration drawn and other particulars of the employees drawingremuneration in excess of the limits set out in said rules are given in "Annexure-A"annexed herewith.
NUMBER OF MEETINGS OF THE BOARD AND AUDIT COMMITTEE
The details of the number of Board and Audit Committee meetings of the Company are setout in the Corporate Governance Report which forms part of this Report.
The details pertaining to Composition of Audit Committee are included in the CorporateGovernance Report which forms part of this report.
DECLARATION OF INDEPENDENCE
The Company has received declarations from all the Independent Directors confirmingthat they meet the criteria of independence as prescribed under the provisions ofCompanies Act 2013 read with the Schedules and Rules issued thereunder as well asRegulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirements under Section 134(3) (c) of the Companies Act 2013 theDirectors confirm that:
(a) in the preparation of the annual accounts for the financial year ended 31st March2018 the applicable accounting standards and Schedule III of the Companies Act 2013have been followed and there are no material departures from the same;
(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 as at 31st March 2018 and of the loss ofthe Company for the financial year ended 31st March 2018;
(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;
(e) the Directors have laid down proper internal financial controls to be followed bythe Company and that such internal financial controls are adequate and are operatingeffectively; and
(f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
AUDITORS AND AUDITORS' REPORT
At the 32nd Annual General Meeting (AGM) of the Company Khandelwal Jain & CompanyChartered Accountants (Firm Registration No. 105049W) was appointed as the StatutoryAuditors to hold office till the conclusion of the 33rd AGM of the Company. KhandelwalJain & Co. Chartered Accountants Auditors of the Company retire at the conclusion ofthe ensuing Annual General Meeting and having confirmed their eligibility offerthemselves for re-appointment. The Company has received necessary letter from them to theeffect that their re-appointment if made would be within the prescribed limits underSection 141(3)(g) of the Companies Act 2013 and that they are not disqualified forre-appointment. The Audit Committee and the Board of Directors therefore recommendedre-appointment of Khandelwal Jain & Co. Chartered Accountants as Auditors of theCompany for the financial year 2018-19 till the conclusion of next AGM for the approval ofthe Shareholders. The observations in the Standalone and Consolidated Auditors' Report areself-explanatory and do not call for any further comments.
Pursuant to the provisions of Section 204 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 your Companyhas appointed M/s MZ & Associates Company Secretaries to conduct the SecretarialAudit of your Company. The Secretarial Audit Report is annexed herewith as "Annexure- B" to this Report. The Secretarial Audit Report does not contain anyqualification reservation or adverse remark.
EXTRACT OF ANNUAL RETURN
The details forming part of the extracts of the Annual Return in Form MGT - 9 inaccordance with Section 92(3) of the Companies Act 2013 read with the Companies(Management and Administration) Rules 2014 are set out herewith as "Annexure - C"to this Report.
RELATED PARTY TRANSACTIONS
During the financial year 2017-18 there were no transactions with related partieswhich qualify as material transactions under the Listing Regulations.
The details of the related party transactions as required under Accounting Standard -18 are set out in Note - 31 to the standalone financial statements forming part of thisAnnual Report.
The Policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed on the Company's website at thelink: http://www.mmwlindia.com/PDF/investors/Policy%20on%20Related%20Party%20Transactions.pdf.
LOANS GUARANTEES AND INVESTMENTS
The details of loans guarantees and investments under Section 186 of the CompaniesAct 2013 read with the Companies (Meetings of Board and its Powers) Rules 2014 are asfollows: Amounts outstanding as at 31st March 2018
|Particulars ||Amount (In Lacs) |
|Loans given ||NIL |
|Guarantees given ||2600.00 |
|Investments made ||14554.36 |
Loans Guarantees and Investments made during the financial year 2017-18
|Name of entity ||Relation ||Amount (Rs. in Lacs) ||Particulars of Loans Guarantees and Investments ||Purpose for which the Loans Guarantees and Investments are proposed to be utilized |
|nexG Devices Private Limited ||Subsidiary under Section 2(87) of the Companies Act 2013 ||2200.00 ||Guarantee ||Corporate Guarantee in favour of IndusInd Bank Limited on behalf of nexG Devices Private Limited a subsidiary of the Company for the procurement of raw material spares stores and meeting working capital requirement. |
|nexG Devices Private Limited ||Subsidiary under Section 2(87) of the Companies Act 2013 ||5000.00 ||Guarantee ||Corporate Guarantee in favour of HDFC Bank Limited on behalf of nexG Devices Private Limited a subsidiary of the Company for carrying out the operations and business activities. |
|Media Matrix Enterprises Private Limited ||Subsidiary under Section 2(87) of the Companies Act 2013 ||9425.00 ||Investment in 0% Compulsory Convertible Debentures (CCDs) ||For business activities of the Subsidiary Purpose |
The Board of Directors of the Company have formulated a Whistle Blower Policy which isin compliance with the provisions of Section 177(10) of the Companies Act 2013 andRegulation 22 of the Listing Regulations. The Company through this policy envisages toencourage the Directors and Employees of the Company to report to the appropriateauthorities any unethical behaviour improper illegal or questionable acts deeds actualor suspected frauds or violation of the Company's Code of Conduct for Directors and SeniorManagement Personnel. The Policy on Vigil Mechanism/ Whistle blower policy may be accessedon the Company's website at the link: http://www.mmwlindia.com/PDF/investors/Whisle%20Blower %20Policy.pdf
DEMATERIALIZATION OF SHARES
Trading in the Equity Shares of the Company is only permitted in the dematerializedform as per the Securities and Exchange Board of India (SEBI) circular dated May 29 2000.
The Company has established connectivity with both the Depositories viz. NationalSecurity Depository Ltd. (NSDL) as well as Central Depository Services (India) Ltd. (CDSL)to facilitate the demat trading. As on 31st March 2018 99.99% of the Company's ShareCapital is in dematerialized form.
The ISIN allotted to the equity shares of the Company is INE200D01020. The Company'sshares are frequently traded on BSE Limited.
In Compliance with Regulation 34 of the Listing Regulations a separate report onCorporate Governance along with certificate from the Practising Company Secretary firm onits compliance forms an integral part of this report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo as stipulated under Section 134 of the Companies Act 2013 read withthe Companies (Accounts) Rules 2014 is as under: Part A and Part B relating toconservation of energy and technology absorption are not applicable to the Company as yourCompany is not a manufacturing Company.
FOREIGN EXCHANGE EARNINGS AND OUTGO:
| ||Financial Year Ended 31.03.2018 ||Financial Year Ended 31.03.2017 |
|Foreign exchange earned in terms of actual inflows ||NIL ||NIL |
|Foreign exchange outgo in terms of actual outflows ||NIL ||NIL |
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.
a) Your Company has not issued equity shares with differential rights as to dividendvoting or otherwise;
b) Your Company does not have any ESOP scheme for its employees/directors.
c) The Whole-time Director of the Company does not receives any remuneration orcommission from any of its subsidiaries.
d) Your Directors further state that during the year under review there were no casesfiled pursuant to the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.
e) No fraud has been reported by the Auditors to the Audit Committee or the Board ofDirectors of the Company.
f) During the year your Company was not required to maintain cost records asprescribed under Section 148(1) of the Companies Act 2013.
Statement in the Management Discussions and Analysis describing the Company'sprojections estimates expectations or predictions may be 'forward looking statements'within the meaning of applicable securities laws and regulations. Actual results coulddiffer materially from those expressed or implied. Important factors that would make adifference to the Company's operations include demand supply conditions changes ingovernment regulations tax regimes and economic developments within the country andabroad and such other factors.
The Directors of the Company are grateful to all the stakeholders including itscustomers bankers suppliers and employees of the Company for their co-operation andassistance.
| ||For and on behalf of the Board || |
|Date : 13th August 2018 ||(Sandeep Jairath) ||(C.K. Goushal) |
|Place : Gurgaon ||Whole-time Director ||Director |
| ||Cum Chief Financial Officer ||(DIN : 01187644) |
| ||(DIN : 05300460) || |