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MT Educare Ltd.

BSE: 534312 Sector: Others
NSE: MTEDUCARE ISIN Code: INE472M01018
BSE 00:00 | 16 Aug 52.95 0.35
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NSE 00:00 | 16 Aug 53.35 0.20
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53.50

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OPEN 51.10
PREVIOUS CLOSE 52.60
VOLUME 1008
52-Week high 92.95
52-Week low 48.05
P/E
Mkt Cap.(Rs cr) 380
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 51.10
CLOSE 52.60
VOLUME 1008
52-Week high 92.95
52-Week low 48.05
P/E
Mkt Cap.(Rs cr) 380
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

MT Educare Ltd. (MTEDUCARE) - Director Report

Company director report

Dear Shareholders

Your Directors are pleased to present the Eleventh Annual Report and Audited FinancialStatements for the financial year ended March 31 2017.

FINANCIAL HIGHLIGHTS

Following is the summary of financial performance of the Company during the year underreview: (Rs in Lakhs)

Particulars 2016-17 2015-16
Revenue from operations 24822.45 24391.78
Total Expenses 21142.81 18922.01
Earnings before Interest Tax Depreciation Amortisation and exceptional items 3679.64 5469.77
Less: Financial Expenses 1356.66 326.70
Less: Depreciation & 1729.01 1465.23
Amortization
Add: Other Income 1198.39 821.10
Profit before exceptional items and tax 1792.36 4498.94
Provision for tax:
Current tax 729.53 1704.18
Deferred tax (7.73) (127.62)
Profit after tax 1070.56 2922.38
Available for Appropriations 1070.56 2922.38
Appropriation:
Interim dividend 0.00 238.92
DDT on Interim Dividend 0.00 48.64
Proposed Final dividend 0.00 557.49
DDT on Final Dividend 0.00 116.46
Transactional Provision for Depreciation 0.00 0.00
Transfer to General Reserve 1070.56 1960.87
1070.56 2922.38

OPERATIONS

Revenue from operations after considering discount and concessions stood at Rs24822.45 Lakhs as against Rs 24391.78 Lakhs for the previous year registering aincrease of around 2%.Earnings before interest depreciation tax and amortization(EBIDTA) decreased by 33% to Rs 3679.64 Lakhs mainly on account of one time Robomate+awareness media campaign as compared to previous year's figure of Rs 5469.77 Lakhs.Profit after tax has also decreased by 63% from Rs 2922.38 Lakhs in the previous year toRs 1070.56 Lakhs in the current year.

DIVIDEND

In order to conserve the resources for future growth of the Company your Directors donot recommend dividend for the year under review.

TRANSFER TO RESERVE

During the year under review Rs 1070.56 Lakhs was transferred to Reserve.

SHARE CAPITAL

There was no change in share capital of the Company during the Financial Year 2016-17.

CHANGE IN THE NATURE OF BUSINESS

During the year under review the members of the Company through Postal Ballot Processthe result of which was declared on March 24 2017 approved the transfer of‘Robomate' business undertaking to its wholly-owned subsidiary viz. Robomate EduTechPrivate Limited. Apart from the above there is no change in the nature of business of theCompany.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THEFINANCIAL YEAR AND DATE OF REPORT

There are no material changes and commitments affecting financial position between theend of the financial year and date of this report.

CONSOLIDATED FINANCIAL STATEMENTS

As on March 31 2017 the Company has 7 (seven) subsidiary companies. The details ofthe above mentioned companies are given in Report on Corporate Governance. During the yearunder review the Board reviewed the affairs of the subsidiaries. The ConsolidatedFinancial Statements of the Company are prepared in accordance with relevant AccountingStandard viz. AS-21 (Consolidated Financial Statements) issued by the Institute ofChartered Accountants of India and forms part of this Annual Report. Further a statementcontaining the salient features of the Financial Statement of our subsidiaries in theprescribed form AOC 1 is included in this report forming part of the Financial Statements.The Financial statements including the consolidated financial statements financialsstatements of subsidiaries and all other documents required to attached in this reporthave been uploaded on the website of the Company http://www.mteducare.com/investor-relations/reports/financial-reports These documents will also beavailable for inspection at the Registered Office of the Company and of the subsidiariesduring business hours on all working days and upto the date of Annual General Meeting.

CORPORATE GOVERNANCE

As required under the provisions of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a report on Corporate Governance and a certificateconfirming compliance with the requirements of Corporate Governance forms part of thisAnnual Report.

MANAGEMENT DISCUSSION AND ANALYSIS

Management Discussion and Analysis for the year under review as stipulated underRegulation 34(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 is presented in a separate section forming part of the Annual Report.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT-9 as requiredunder Section 92 of the Companies Act 2013 is included in this report as Annexure 1and forms an integral part of this Report.

DIRECTORS

In accordance with the provisions of Section 152 of the Companies Act 2013 and inaccordance with the Articles of Association of the Company Mr. Naarayanan Iyer (DIN:00295246) Director of the Company retires by rotation and being eligible offer himselffor re-appointment at the ensuing Annual General Meeting (‘AGM'). The tenure of Mr.Mahesh Shetty (DIN: 01526975) as Managing Director of the Company expires on July 162017. The Board at its meeting held on May 11 2017 on recommendation of Nomination andRemuneration Committee has approved the re-appointment of Mr. Mahesh Shetty for afurther period of 3 (three) years. His re-appointment and remuneration is in terms ofSection 196 197 198 and 203 read with provisions of Schedule V of the Companies Act2013. The detailed terms and conditions including remuneration have been mentioned in theNotice convening 11th AGM of the Company. The Board of Directors recommends there-appointment of Mr. Mahesh Shetty as Managing Director.

Brief profile of the Directors proposed to be appointed/ re-appointed as required underRegulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 and Secretarial Standards on General Meetings (SS-2) issued by the Institute ofCompany Secretaries of India (ICSI) are provided in the Notice of 11th AGM ofthe Company.

All Independent Directors have given a declaration that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation16 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

KEY MANAGERIAL PERSONNEL

During the year under review your Company had following Key Managerial Personnel:

Sr. Name of the Person Designation
No.
1 Mr. Mahesh R. Shetty Chairman & Managing Director
2 Mr. Yagnesh Sanghrajka Chief Financial Officer
- upto 30 June 2016
3 Mr. Sanjay Sethi Chief Financial Officer
- w.e.f. 1 July 2016
4 Mr. Ashwin M. Patel Company Secretary
- upto 30 June 2016
5 Mr. Dinesh Darji Company Secretary
- w.e.f. 1 July 2016

MEETINGS OF THE BOARD

The Board meets at regular intervals to discuss and decide on Company's business policyand strategy apart from other business of the Board. Notice of Meetings of the Board ofDirectors is circulated well in advance along with the agenda giving detailedexplanations to enable the Board to take an informed decision.

During the year under review the Board of Directors met Six (6) times the details ofwhich are given in the Report on Corporate Governance.

BOARD EVALUATION

Pursuant to the provisions of Section 178 of Companies Act 2013 read with Schedule IV;and Regulation 17(9) of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 as amended the Board has carried out an annual performance evaluationof its own performance the directors individually as well as the evaluation of theworking of its committees. The Board of Directors expressed their satisfaction with theevaluation process. The Nomination and Remuneration Committee has formulated criteria forevaluation of performance of independent directors and the Board of Directors; whether toextend or continue the term of appointment of the independent director on the basis ofthe report of performance evaluation of independent directors.

COMMITTEES OF THE BOARD

There are currently following Committees of the Board:

1. Audit Committee

2. Stakeholders' Relationship Committee

3. Nomination and Remuneration Committee

4. Corporate Social Responsibility Committee

Details of the Committees with respect to their composition terms of referencemeetings and attendance at the meetings held during the year are provided in the Reporton Corporate Governance forming part of this Annual Report.

AUDIT COMMITTEE AND ITS COMPOSITION

The Audit Committee is duly constituted as per the provisions of Section 177 of theCompanies Act 2013 and Regulation 18 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. The composition of the Audit Committee is provided inReport on Corporate Governance.

VIGIL MECHANISM/ WHISTLE BLOWER POLICY

The Company has established and adopted Vigil Mechanism and the policy thereof fordirectors and employees of the Company in accordance with the provisions of Section 177 ofthe Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 to provide a system for reporting of genuine concerns. During the yearunder review no personnel of the Company approached the Audit Committee on any issuefalling under the said policy and no personnel was denied access to the Audit Committee.

The vigil mechanism policy is available on the website of the company at web link:http://www.mteducare.com/images/ Whistle_Blower_Policy_MT_Educare_Ltd.pdf

NOMINATION AND REMUNERATION POLICY

Pursuant to the provisions of Section 178(3) of the Companies Act 2013 the Board ofDirectors has framed a policy which lays down a framework in relation to criteria forselection and appointment of Board Members including determination of qualificationspositive attributes remuneration of Directors Key Managerial Personnel and SeniorManagement of the Company independence of directors and other matters as provided underSection 178(3) of the Companies Act 2013. The details of this policy are given in theReport of Corporate Governance.

RELATED PARTY TRANSACTIONS

All transactions entered into with Related Parties for the year under review are onarm's length basis and in the ordinary course of business and are reported in the Notes tothe Financial Statements. During the year under review the Company has not entered intoany material related party transactions and hence no transactions are required to bereported in Form AOC -2. Your Company has developed Standard Operating Procedure foridentification and monitoring of such transactions.

The Policy on Related Party Transactions has been uploaded on the website of theCompany. The weblink of the same has been provided in the Report of Corporate Governance.None of the Directors have any pecuniary relationship of transactions vis-a-vis theCompany.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant and material orders passed by the Regulators/Courts that wouldimpact the going concern status of the Company and its future operations.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(3)(c) of the Companies Act 2013 the Boardof Directors hereby state :

(i) that in the preparation of the Annual Accounts for the year under review allapplicable accounting standards have been followed along with proper explanation relatingto material departures if any;

(ii) that the Directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at March 31 2017 andof the profit of the Company for the year ended on that date;

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

(iv) that the annual accounts have been prepared on a ‘going concern' basis;

(v) that the Directors have laid down proper internal financial controls to be followedby the Company and that such internal financial controls are adequate and were operatingeffectively; and

(vi) that the Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

DETAILS IN RESPECT OF FRAUD REPORTED BY AUDITORS

Pursuant to Section 143(12) of the Companies Act 2013 there were no frauds reported bythe Auditors of the Company during the year under review to the Audit Committee or theBoard of Directors as such there is nothing to report under Section 134(3)(ca) of theCompanies Act 2013.

AUDITORS

Statutory Auditors and their Report

Members of the Company at the 10th Annual General Meeting (AGM) held onSeptember 28 2016 had approved the appointment of M/s. MZSK & Associates (FRN:105047W) as Statutory Auditors of the Company for a period of five consecutive yearsi.e. up to the conclusion of 15th AGM and to audit the financial statements of theCompany for the financial year from 2016-17 to 2020-21. As per the provisions of Section139 of the Companies Act 2013 the appointment of Auditors is required to be ratified bymembers each year at the AGM. Your Directors recommends the ratification of theappointment of MZSK & Associates Chartered Accountants Mumbai as Statutory Auditorsof the Company.

There were no qualification reservation disclaimer and adverse remarks made by theStatutory Auditors of the Company in their audit report.

Cost Auditors

As per the requirement of the Central Government and pursuant to provisions of Section148 of the Companies Act 2013 read with the Companies (Cost Records and Audit) AmendmentsRules 2014 your Company is required to maintain cost records to drive in transparencyand keep a check on its costing.

The Board of Directors on the recommendation of the Audit Committee have appointed M/s.Joshi Apte & Associates Cost Accountants (Registration No. 00240) as Cost Auditors toaudit the Cost Accounts of the Company for the financial year 2017-18 at a remuneration ofRs 100000/- (Rupees One Lakh only) plus service tax as applicable and reimbursement ofout of pocket expenses. Your Directors recommend to the members of the Company to approvethe remuneration payable to the Cost Auditors for the Financial Year 2017-18 as stated inthe Notice of the ensuing 11th Annual General Meeting.

Secretarial Auditors and their Report

Pursuant to the provisions of Section 204 of the Companies Act 2013 and rules madethereunder the Company appointed M/s. Manish Ghia & Associates Company SecretariesMumbai to undertake Secretarial Audit of the Company. The Secretarial Audit Report isincluded as Annexure 2 and forms integral part of this Report. In respect to theSecretarial Auditors' remarks in their report the Directors would like to state as under:

Sr. No. Qualifications Directors' Remark
1 Delay in submitting compliance certificate for the half year ended March 31 2016 & half year ended September 30 2016 as is required under Reg 7(3) with Stock Exchanges Delay has been due to inadvertence and unintentional. Necessary monitoring mechanism has been put in place to ensure compliance.
2 Delay in publishing the financials in newspaper pertaining to the quarter & half year ended September 30 2016 and quarter & Nine Month ended December 31 2016 Due to certain technical issues at the end of advertising agency's/ newspaper(s) there was unintentional delay in the publication. Suitable steps have been taken to avoid any recurrence of such instances in future

Internal Auditors and Internal Control System & its adequacy

Your Company has an effective internal control and risk-mitigation system which areassessed and strengthened with standard operating procedures. The Company's internalcontrol system is commensurate with its size scale and modalities of operation. TheInternal Audit is entrusted to M/s. Mukund M. Chitale & Co. CharteredAccountants Mumbai. The main thrust of the audit is to test and review controlsappraisal of risk and business process.

The Audit Committee of the Board of Directors reviews the adequacy and effectiveness ofthe internal control system and suggests improvement to strengthen the same. The Companyhas strong Management Information System being an integral part of control mechanism.

The Audit Committee Statutory Auditors and the Business Heads are periodicallyappraised of the internal audit findings and corrective actions taken. Audit plays animportant role in providing assurance to the Board of Directors. Significant auditobservations and corrective actions taken by the management are presented to the AuditCommittee. Proper steps have been taken to ensure and maintain objectivity andindependence of Internal Audit.

RISK MANAGEMENT

Your Company has long been following the principle of risk minimization as is the normin every industry. The Board members were informed about risk assessment and minimizationprocedures after which the Board formally adopted steps for framing implementing andmonitoring the risk management plan for the company.

The main objective of this plan is to ensure sustainable business growth with stabilityand to promote a proactive approach in reporting evaluating and resolving risksassociated with the business. In order to achieve the key objective the plan establishesa structured and disciplined approach to Risk Management in order to guide decisions onrisk related issues.

In today's challenging and competitive environment strategies for mitigating inherentrisks in accomplishing the growth plans of the Company are imperative. The common risksinter-alia are: Regulations competition Business risk Technology obsolescenceInvestments retention of talent and expansion of facilities.

Business risk inter-alia further includes financial risk political risk fidelityrisk legal risk. As a matter of policy these risks are assessed and steps as appropriateare taken to mitigate the same.

CORPORATE SOCIAL RESPONSIBILITY

As part of its initiative under the Corporate Social Responsibility ('CSR') the Companyhas undertaken project of coaching 12363 students of Standard IX and 10558 students ofStandard X (English / Hindi / Marathi and Urdu medium) of 158 BMC Schools across Mumbai.The projects are in accordance with Schedule VII of the Companies Act 2013 and theCompany's CSR policy. The Company has been conducting Free Grade Improvement Classes forstudents of Standard X with a vision to achieve 100% results in BMC schools since last 8years and over the years the Company has coached approximately 75000 underprivilegedchildren. Under this project we mentor guide and coach the students of Standard IX and Xencouraging them to pursue qualitative education and lead a dignified life. The Report onCSR Activities as required under Companies (Corporate Social Responsibility Policy) Rules2014 is set out as Annexure 3 forming part of this Report. Apart from the CSRActivities under the Companies Act 2013 the Company continues to voluntarily support thefollowing social initiatives / NGO's like (a) Aasara (b) Amcha Ghar (c) Justice ChainaniOld Age Home etc. to name a few.

ENVIRONMENT AND SAFETY

The operations of the Company are conducted in such a manner that it ensures safety ofall concerned and a pleasant working environment.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013

As required by the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 the Company has in place and implemented a policy on prevention ofsexual harassment at workplace with a mechanism of lodging & redressing thecomplaints. An Anti-Sexual Harassment Committee has been set up to redress the complaints.The redressal of complaint is informed to the concerned employee and also placed on theintranet for the benefits of its employee. During the year 2016-17 the Company has notreceived any complaint of sexual harassment.

HUMAN RESOURCE AND INDUSTRIAL RELATIONS

The Company takes pride in the commitment competence and dedication shown by itsemployee and Visiting Faculties in all areas of operations. The Company has a structuredinduction process and management development programs /Teacher training workshops toupgrade skills of managers / Faculties. Objective appraisal systems based on Key ResultAreas are in place for senior management staff. The Company is dedicated to enhancing andretaining top talent through superior learning and organizational development as thisbeing the pillar to support the Company's growth and sustainability in the future.

EMPLOYEE STOCK OPTION SCHEME

The Company implemented the Employee Stock Options Scheme "ESOP 2016" inaccordance with the Securities and Exchange Board of India (Share Based Employee Benefits)Regulations 2014. The applicable disclosures as stipulated under the said Regulations asat March 31 2017 are provided in Note No. 26.7 of (Standalone) FinancialStatements.

STATUTORY INFORMATION

The information on energy conservation technology absorption and foreign exchangeearnings and outgo as required to be disclosed under Section 134 (3)(m) of the CompaniesAct 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 is given below:

i. Part A & B of the Rules pertaining to Conservation of Energy and TechnologyAbsorption are not applicable to your Company.

ii. Foreign Exchange Earnings and Outgo: Earnings: Rs 28.95 Lakhs - (Previous year Rs33.45 Lakhs) Outgo: NIL (Previous year: NIL)

PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS BY THE COMPANY

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in notes to Financial Statements.

PARTICULARS OF REMUNERATION

The information required under Section 197 (12) of the Companies Act 2013 read withCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 and formingpart of the Directors' Report for the year ended March 31 2017 is given in a separate Annexure4 to this Report. The particulars of employees in compliance of provisions of Section134(3)(q) read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 will be provided to the shareholders upon a receipt ofwritten request duly signed at the Registered Office of the Company.

The above referred Annexure is also available for inspection by members at theRegistered Office of the Company for a period of 21 days before the ensuing 11thAGM and up to the date of the AGM between 11.00 a.m. and 1.00 p.m. on all working days(except Saturday and Public Holidays). None of the employee listed in the said Annexureis a relative of any director of the Company. None of the employee holds (by himself oralong with his spouse and dependent children) more than two percent of the Equity sharesof the Company.

DEPOSITS

During the year under review the Company has not accepted any deposits within themeaning of Section 73 and Section 76 of the Companies Act 2013 read with the Companies(Acceptance of Deposit) Rules 2014.

BUSINESS RESPONSIBILITY STATEMENT

The Business Responsibility Reporting is not applicable to your Company for thefinancial year ending March 31 2017.

CODE OF CONDUCT COMPLIANCE

A declaration signed by Mr. Mahesh Shetty Chairman & Managing Director affirmingcompliance for the financial year 2016-17 with the Company's Code of Conduct for theDirectors and Senior Management as required under Regulation 17(5) of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 as amended is annexed andforms part of the Directors' Report.

APPRECIATION

Your Directors wish to express their appreciation for the assistance and co-operationreceived from the financial institutions banks Government authorities customersvendors and members during the year under review.

Your Directors also express their appreciation to all the visiting faculty lecturersand employees of MT Educare FAMILY for their hard work commitment dedicated services andcollective contribution.

For and on behalf of the Board of Directors

Place: Mumbai Mahesh R. Shetty
Date: May 11 2017 Chairman and Managing Director