Your Directors are hereby pleased to present the 23rd Annual Report and the AuditedFinancial Statements of the Company for the financial year ended 31st March 2018.
Pursuant to notification dated February 16 2015 issued by the Ministry of CorporateAffairs the Company has adopted the Indian Accounting Standards ("Ind AS") witheffect from April 01 2017. Accordingly financial statements for the year ended March 312018 have been prepared in accordance with the recognition and measurement principles laiddown in the Ind AS prescribed under Section 133 of the Companies Act 2013 read with therelevant rules issued thereunder and the other accounting standards generally accepted inIndia.
A summary of your Company's financial performance is given below:
Rs. In Crores
|Particulars || |
| || |
For the year ended March 31
|For the year ended March 31 |
| ||2018 ||2017 ||2018 |
|Total Revenue ||186.19 ||207.21 ||186.19 |
|Operating Expenses ||142.23 ||152.12 ||142.23 |
|Earnings before Interest Depreciation Tax & Amortization (EBIDTA) ||43.97 ||55.09 ||43.97 |
|Interest and Financial Charges ||29.20 ||25.21 ||29.20 |
|Earnings before Depreciation Tax & Amortization (EBDTA) ||14.77 ||29.88 ||14.77 |
|Depreciation Amortization & other exceptional expenses ||31.20 ||28.45 ||31.20 |
|Earning Before Tax (EBT) ||-95.26 ||1.43 ||-95.26 |
|Tax ||0.00 ||0 ||0.00 |
|Earning After Tax (EAT) ||-95.26 ||1.43 ||-95.26 |
State of Company's affairs and Operational Results
The highlights of the Company's performance are as under:
Total revenue was Rs. 186.19 Cr compared to the previous year's total revenue ofRs. 207.21 Cr
EBITDA stood at Rs. 43.97 Cr compared to Rs. 55.09 Cr of corresponding previousfinancial year.
Earning before Tax (EBT) for the period is Rs. (95.26) Cr as compared to Rs.1.43 Cr of last fiscal.
Earning after Tax (EAT) stood at Rs. (95.26) Cr as compared to Rs. 1.43 Cr oflast fiscal.
EPS stood at Rs. (31.28) as compared to Rs. 0.47 of last financial year.
Business/ Operational Review
The Year 2017-18 has been a challenging year for the Company due to delay incollections higher competitive intensity
in the market as well as issues pertaining to debt payment.
Notwithstanding this your company has demonstrated healthy growth in revenues fromcable TV business on a year-on-year basis (Y-o-Y) during the year under review.
Members will be happy to know that in spite of all the difficult situations EBITDAhave been positive during the year under review.
The Management reviewed the details of receivables and took a firm step by creatingprovision of Rs. 679.40 million against doubtful receivables declaring bad debts ofRs.123.60 million and issuing credit notes of Rs.162.50 million. This amount is primarilyon account of disruption of services during the process of digitization and acquisition oflocal operators.
Segment Revenue Contribution:
The contribution of each income stream to the total revenue is as below:-
|Cable TV services ||: 66 % |
|Data Services ||: 13% |
|Infra-structure leasing ||: 06 % |
|Carriage fees ||: 12% |
|Others ||: 03 %. |
Segment wise Analysis i) Cable TV Service
During the year under review your company continued to be a dominant player in theCable TV market in Odisha and has continued to consolidate its position in the states ofChhattisgarh Andhra Pradesh and Telangana.
As on 31.03.2018 the total Cable TV customer base has been increased to 766980(Previous Year: 750471) which is a 2% growth over previous year.
With internationally used "Last Mile" model implemented by your Companydigitization of entire CATV subscribers and completion of integration process in the newlyacquired locations the Company is hopeful of continuing growth in the customer base inthe future.
ii) Broadband Services Operation
The total Broadband subscriber base as on 31.03.2018 is 50086(Previous Year: 73087).With competition across the Industry the broadband growth reduced during the year.However your Company is hopeful increasing the growth trend of customer base in thecoming years with the launch of new competitive plans higher data speed and bettertechnology including service.
Your Company has successfully launched broadband plans starting from Rs. 99 per monthwhich will counter the plans launched by the Telecom players in the 4G and LTE space. Inaddition to this the DOCSIS 3.0 plans will have speeds up to 100 Mbps with One Terabyteof usage option. To offer better experience broadband speed to the customers your Companyhas withdrawn all the schemes where the download speed was below 2 Mbps. With aggressiveATL and BTL marketing your company expects to grow the Broadband numbers in the comingfinancial year. Your company is using HFC network architecture which can easily beupgraded to FTTH topology in future. Your company is currently providing FTTH for puredata usage. With the implementation of new technology high speed data service andaggressive marketing strategy the Company is well placed to cater to the growing demand.
Considering both cable TV and broadband together your company has achieved total RGUbase of 817066 by the end of the current year (previous year 823558) a de-growth of 8%. It is important to note here that in line with your company's philosophy of operatingon "Last Mile" Model 90% company's RGUs are on its own 'last mile' network.
iii) Infrastructure leasing
Over last few years your Company is pursuing infrastructure segment as another majorrevenue generating stream by leasing out its own infrastructure to corporate clients fortheir communication requirement and has leased out to various corporates a total of 1556kms (Previous Year: 1878 kms) as on 31 March 2018 a reduction of 17 % over the previousyear.
As the Company has reported losses for the year under review no dividend has beenrecommended by the Board.
Transfer to Reserves
As no dividend is proposed due to losses so no amount is recommended to be transferredto General Reserve.
The movement of the share capital during the year under review is as follows:
|Particulars ||Equity Share Capital (in Rs.) |
|At the beginning of the year i.e. as on April 01 2017 ||303654640 |
|Stock Options allotted during the year (ESOP) on May 19 2017 ||1114360 |
|At the end of the year i.e. as on March 31 2018 ||304769000 |
Holding Subsidiaries Et Associates
During the year your Company has incorporated "Ortel Broadband Limited" asits wholly-owned subsidiary company in Delhi to provide internet services.
In accordance with the provision of Section 129(3) of the Companies Act 2013 read withrule 8 of the Companies (Accounts) Rules 2014 as amended the Company has prepared itsconsolidated financial statements including its subsidiary company which forms part ofthis report. The financial position and performance of the subsidiary company of theCompany is annexed to this report.
In accordance with the third proviso to Section 136(1) of the Companies Act 2013 theAnnual Report of the Company containing therein its standalone financial statements andthe consolidated financial statements and all other documents required to be attachedthereto has been hosted on its website www.ortelcom.com .
Any shareholder interested in obtaining a physical copy of the aforesaid financialstatements may write to the Company Secretary at the Registered Office of the Company.Further please note that the said financial statements will
also be available for inspection by the Members of the Company at the Registered Officeof the Company during business hours from 10.00 AM. to 6.00 P.M. on all working daysexcept Sundays and National Holidays.
Change in the Nature of Business If Any
During the year under review there were no material changes in the nature of thebusiness of the Company.
Consolidated Financial Statements
The Consolidated financial statements prepared and annexed in accordance withAccounting Standards as prescribed under Section 133 of the Companies Act 2013 read withRule 7 of Companies (Accounts) Rules 2014 and Guidelines issued by Securities andExchange Board of India (SEBI) also forms part of this Annual Report.
Revision of Financial Statement
There was no revision of the financial statements for the year under review.
Extract of the Annual Return
An extract of annual return for the financial year ended on
31st March 2018 in Form MGT-9 pursuant to section 92(3) of the Companies Act 2013 andrule 12(1) of the Companies (Management and Administration) Rules 2014 is attached asAnnexure-1 forming part of this Report.
M/s Haribhakti and Co. LLP Chartered Accountants Kolkata were appointed as StatutoryAuditors of your Company for a term of five years with effect from 19th Annual GeneralMeeting till the conclusion of 24th Annual General Meeting of the Company subject toratification of their appointment by the shareholders in the Annual General Meeting of theCompany every year if eligible. As per the provisions of Section 139 of the Companies Act2013 the appointment of Auditors is required to be ratified by Members at every AnnualGeneral Meeting.
In accordance with the Companies Amendment Act 2017 enforced on 7th May 2018 by theMinistry of Corporate Affairs the appointment of Statutory Auditors is not required to beratified at every Annual General Meeting.
The Report given by the Auditors on the financial statement of the Company is part ofthis Report. There has been no qualification reservation adverse remark or disclaimergiven by the Auditors in their Report.
Observations of the Auditors
Observations of the Auditors on the Annual Accounts of the Company forms part of the"Auditors Report". The observations made in their report when read together withthe relevant notes to the accounts are self-explanatory.
Pursuant to the provisions of Section 179 and 204 of the Companies Act 2013 read withthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 M/ sKumar Suresh & Associates Gurugram a firm of Practicing Company Secretaries wasappointed as Secretarial Auditor to conduct the Secretarial Audit of the Company for theFinancial Year 2017-18.
CS Suresh Kumar Yadav Secretarial Auditor has given the Secretarial Audit Report inForm No. MR-3 and the same has been annexed to the Board's Report and marked as 'Annex-ure-2'. The Secretarial Audit Report does not contain any qualification reservationadverse remark or disclaimer and is self-explanatory.
Your Board has also re-appointed M/s Kumar Suresh & Associates Gurugram asSecretarial Auditor for FY 2018-19 who is eligible for such reappointment to conductSecretarial Audit of your Company.
Terms of M/s NIRAN & CO. Cost Accountants Bhubaneswar Odisha who werereappointed as Cost Auditor of the Company for Financial Year 2017-18 expired on 31stMarch 2018.
Your Directors have approved their reappointment for FY 2018-19 and their remunerationshall be ratified by the members in the ensuing Annual General meeting.
Terms of M/s SCM & Associates Chartered Accountants Bhubaneswar Odisha who werereappointed as Internal Auditor of the Company for Financial Year 2017-18 expired on 31stMarch 2018.
Your Directors have approved their reappointment for financial year 2018-19.
The Directors state that applicable Secretarial Standards
i.e. SS-1 and SS-2 relating to 'Meetings of the Board of Directors' and 'GeneralMeetings' respectively have been duly followed by the Company.
Directors' Responsibility Statement
Yours Directors hereby certify that:
a) in the preparation of the annual accounts for the year ended March 31 2018 theapplicable accounting standards read with requirements set out under Schedule III to theAct have been followed and there are no material departures from the same;
b) the directors have selected such accounting policies and applied them consistentlyand made judgment and estimates that they are reasonable and prudent so as to give a trueand fair view of the state of affairs of the company as at March 31 2018 and of theprofit or loss of the company for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act for safeguardingthe assets of the company and preventing and detecting fraud and other irregularities;
d) the directors have prepared the annual accounts on a going concern basis;
e) the directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively and
f) the directors have devised proper systems to ensure compliance with the provisionsof all applicable laws
and that such systems were adequate and operating effectively.
Utilization of IPO Proceeds
Against Rs.100.79 Cr of IPO proceeds (net of issue expenses) Rs. 75.78 Cr was utilizedfor the object set out in the offer document and balance amount pending utilization iskept in the Bank and fixed deposit. There is no deviation in the utilization of issueproceeds during the year under review.
Particulars of Loans Guarantees or Investments under Section 186
Your Company has not given any loans or guarantee or made any investments under Section186 of the Companies Act 2013.
Particulars of Loans/Advances or Investments Outstanding During the Financial Year
Disclosure on particulars relating to loans advances and investments outstandingduring the financial year is disclosed in note no 567 & 14 under "Notes toFinancial Statement" forming part of the financial statement of the Company.
Particulars of Contracts or Arrangements with Related Parties
All contracts / arrangements / transactions entered by the Company during the FinancialYear with related parties were in the ordinary course of business and on an arm's lengthbasis and were reviewed and approved by the Audit Committee and Board. During the yearthe Company has not entered into any contract / arrangement / transaction with relatedparties which could be considered material in accordance with the Company's Policy onMateriality of Related Party Transactions. All the transactions made on arm's length basisare being reported in Form No. AOC - 2 in terms of Section 134 of the Companies Act 2013read with Rule 8 of the Companies (Accounts) Rules 2014 is annexed as 'Annexure-3'.
The policy on dealing with Related Party Transactions can be viewed athttp://www.ortelcom.com
Performance Evaluation of Board Committees and Individual Directors Including ManagingDirector
In compliance with the Companies Act 2013 and Regulation 17 of the ListingRegulations the performance evaluation of the Board its Committees and individualDirectors including Managing Director were carried out during the year under review.
Independent Directors in their separate meeting evaluated performance of Board as awhole non-independent Director and Chairperson of the Board.
Further based on the appraisal report of the individual Directors both for self andother Directors Board carried out evaluation of Independent Directors Managing Directorand all its committees.
The evaluation framework for assessing the performance of Directors comprises of thefollowing parameters:
i. Attendance of Board Meetings and Board Committee Meetings
ii. Contribution at meetings
iii. Guidance/support to Management
iv. Relationship with Board and Committees
v Degree of participation etc.
Risk management has always been an integral part of the corporate strategy whichcomplements the organizational capabilities with business opportunities robust planningand execution. The Company through a process of management mechanism covering the riskmapping and trend analysis risk exposure potential impact and risk mitigation practicemanages the potential risks. A detailed regular exercise is being carried out to identifyevaluate manage and monitor both business and non-business risks. A Risk ManagementCommittee of the Board periodically reviews the risks and suggests steps to be taken tocontrol and mitigate the same.
More details on Risk Management indicating development and implementation of RiskManagement policy including identification of elements of risk and their mitigation arecovered in Management's Discussion and Analysis section which forms part of this Report.
Your Company has not accepted any deposit from the public during the year under review.
Declaration given by Independent Directors
All the Independent Directors have given declaration of their independence in terms ofSection 149(7) of the Companies Act 2013 and Regulation 16(1)(b) of the SEBI (ListingObligations And Disclosure Requirements) Regulations 2015.
Number of Meetings of Board of Directors
Seven meetings of the Board of Directors were held during the year under review. Theparticulars of meetings held and attended by each Director are detailed in the CorporateGovernance Report which forms part of this Report.
Material Changes and Commitments If any
There were no significant material changes and commitments affecting the financialposition of the Company which has occurred between the end of the Financial Year of theCom- pany to which the Financial Statement relate and the date of its report
Employee Stock Option Scheme
During the year under review the Company has allotted 111436 Equity Shares of facevalue Rs.10/- each at an issue price of Rs. 140/- per Equity Share including premium ofRs. 130/- per Equity Share to eligible employees of the Company under 'Ortel EmployeeStock Option Scheme 2015' ("ESOS 2015") and As per ESOS 2015 an Ortel EmployeeWelfare Trust was executed by the Company to acquire shares of the Company from Secondarymarket for offering them to the eligible employees in future as per the direction ofNomination & Remuneration Committee of the Board. During the year under review theTrust has acquired 10000 shares of the Company. The details of disclosure form part of theCorporate Governance.
During the year under review the following changes took place in the composition ofBoard of Directors of the Company:
1. Mr. Baijayant Panda has been resigned from the post of Non-Executive Director cumChairman with effect from the close of business hours on Friday March 30 2018. The Boardacknowledges the valuable contributions rendered by Mr Baijayant Panda during his tenureas Non-Executive Director cum Chairman of the Company and places on record its deepappreciation for the insightful perspectives and suggestions provided by him at themeetings of the Board/Committees.
2. Mr. Subhrakant Panda has been resigned from the post of Non-Executive Director witheffect from the close of business hours on Friday March 30 2018. The Board acknowledgesthe valuable contributions rendered by Mr Subhrakant Panda during his tenure asNon-Executive Director cum Chairman of the Company and places on record its deepappreciation for the insightful perspectives and suggestions provided by him at themeetings of the Board/Committees.
3. Major (Retd.) Rabi Narayan Misra has been resigned from the post of Non-Executiveand Independent Director with effect from the close of business hours on Friday March 302018. The Board acknowledges the valuable contributions rendered by Major (Retd.) RabiNarayan Misra during his tenure as Non-Executive Director cum Chairman of the Company andplaces on record its deep appreciation for the insightful perspectives and suggestionsprovided by him at the meetings of the Board/Committees.
4. Mr. Gautam Buddha Mukherjee has been resigned from the post of Non-Executive andIndependent Director with effect from November 15 2017. The Board acknowledges thevaluable contributions rendered by Mr Gautam Buddha Mukherji during his tenure asNon-Executive Director cum Chairman of the Company and places on record its deepappreciation for the insightful perspectives and suggestions provided by him at themeetings of the Board/Committees.
Pursuant to Section 149(13) of the Companies Act 2013 the independent directors arenot liable to retire by rotation. Further Section 152 (6) of the Companies Act 2013stipulates that 2/3rd of the total number of directors of the public company should beliable to retire by rotation and out of such directors 1/3rd should retire by rotation atevery Annual General Meeting of the company.
To meet the requirement of provisions of Section 152 (6) of the Companies Act 2013 andArticle 149 150 151 and 152 of the Article of Association the Managing Director or thewhole time Director shall not while he/she continues to hold that office be subject toretirement by rotation under Article 151 but he/she shall be subject to the provision ofany contract between him/her and the Company be subject to the same provisions as to theresignation and removal as the other Directors of the Company and he/she shall ipso factoand immediately cease to be a Managing Director or Whole-time Director if he/she ceases tohold the office of Director for any cause provided that if at any time the number ofDirectors (including the managing Director or Whole-time Director) as are not subject toretirement by rotation shall exceed one-third of the total) number of the Directors forthe time being then such of the Managing Director or Whole-time Director or two or more ofthem as the Directors may from time to time determine shall be liable to retirement byrotation in accordance with the Article 151 to the intent that the number of Directors notliable to retirement by rotation shall not exceed one-third of the total number ofDirectors for the time being. Flowever he/she shall be counted in determining the numberof Directors to retire (save as otherwise provided in a contract in terms of provisions ofthe Act or Rules made hereunder or in a resolution passed by Board or Shareholders of theCompany).
In view of the above Mrs. Jagi Mangat Panda Managing Director of the Company isretiring at the ensuing Annual General Meeting. Your Directors have recommended herreappointment in the ensuing AGM.
During the year no other changes took place in the composition of the Board ofDirectors of the Company. The composition of the Board of Directors of the Company is incompliance with the applicable norms.
Declaration of Independence
All the independent Directors of the Company have given their respective declarationsstating that they meet the criteria prescribed for independence under the applicable lawsand in the opinion of the Board all the independent Directors of the Company meet thesaid criteria.
Key Managerial Personnel
1. Mr. Lalit Kumar Mohanty has been resigned from the post of Company Secretary andCompliance Officer of the Company with effect from 24th June 2017. The Board acknowledgesthe invaluable contributions rendered by Mr. Lalit Kumar Mohanty during his tenure asCompany Secretary and Compliance Officer of the Company and places on record its deepappreciation and the Board considered and approved Mr. Bidu Bhusan Dash as CompanySecretary and Compliance Officer of the Company with effect from 05th September 2017 inplace of Mr. Lalit Kumar Mohanty.
2. Mr. Manoj Kumar Patra has been resigned from the post of Chief Financial Officer ofthe Company with effect from 05th September 2017. The Board acknowledges the invaluablecontributions rendered by Mr. Manoj Kumar Patra during his tenure as Chief FinancialOfficer of the Company and places on record its deep appreciation and the Board consideredand approved Mr. Satyanarayan Jena as Chief Financial Officer of the Company with effectfrom 05th September 2017 in place of Mr. Manoj Kumar Patra.
During the year no other changes took place in the composition of the key managerialpersonnel of the Company.
Disclosure with respect to Unclaimed Suspense Account
Pursuant to Listing Regulations details in respect of the shares lying in the OrtelCommunications Limited-Unclaimed Suspense Account till 31st March 2018 are as under:
|Description ||No of shareholders ||No. of shares |
|(i) Aggregate number of shareholders and the outstanding shares in the unclaimed suspense 7009account lying as on 1st April 2017 ||0 ||0 |
|(ii) Number of shareholders who approached the Company for transfer of shares from unclaimed 24 suspense account during the year 2017-18 ||0 ||0 |
|(Hi) Number of shareholders to whom shares were transferred from unclaimed suspense account 24 during the year 2017-2018 ||0 ||0 |
|(tv) Aggregate number of shareholders and the outstanding shares in the unclaimed suspense account lying as on 31st March 2018 ||1 ||75 |
Significant and Material Orders passed by the Regulators or Courts or Tribunalsimpacting the Going Concern Status and Company's operations in future
No such significant and material order have been passed by any Regulator/ Court/Tribunal against the Company which will impact the Going Concern status and company'soperation in future. In those matters which are pending before various regulators orcourts or tribunals your company has strong reasons to succeed in all the said disputedmatters
Particulars of Employees
Information as per section 197 and Rule 5(1) & 5(2) of the Companies (Appointment& Remuneration of Managerial Personnel) Rule 2014 as amended a statement showing thenames and other particulars of the employees drawing remuneration in excess of the limitsset out in the said rules are provided as 'Annexure-4'.
The Company is committed to maintain the highest standards of Corporate Governance andadhere to the Corporate Governance requirements set out by the Securities and ExchangeBoard of India (SEBI). The report on Corporate Governance as stipulated under the ListingRegulations Management Discussion and Analysis Certificate regarding Compliance ofconditions of Corporate Governance and Certificate by CEO & CFO forms an integral partof this Report as Annexures.
Conservation of Energy Technology Absorption and Foreign Exchange Earnings Et Outgo
The Company is a Multi System Operator (MSO) and is carrying on business of interalia providing Cable TV and Broadband service along with other value added services.Since this does not involve any manufacturing activity most of the
Information required to be provided under Section 134(3)(m) of the Companies Act 2013read with the Companies (Accounts) Rules 2014 are nil / not applicable.
Further your Company being a service provider requires minimal energy consumptionand Company takes all possible measures to ensure optimal use of energy avoid wastagesand conserve energy as far as possible. Following are the energy conservation measuresbeing taken by Company over a period of time to ensure minimum energy consumption andtechnology absorption:
|Conservation of Energy: ||Foreign Exchange Earnings Et Outgo |
|1. The steps taken or impact or conservation of energy. || Conservation of RF Optical Electrical and fuel energy is being accomplished by your company in economically responsible and beneficial ways by using power efficient equipment broadband HFC network provisioning system ergonomics in the cable layout cleanest and state of art technologies.- |
|2. The steps taken by the company for utilizing alternate sources of energy. || Increasing more deeper fiber by using Broadband HFC network in star structure has resulted less power consumption. |
|3. The capital investment on energy conservation equipment. || |
| || Applying the strongest feasible energy efficiency standards to network upto electronics RF products and signal quality. |
|Technology Absorption: || |
|1. The efforts made towards technology absorption. || Your company is one of the MSOs in India which has started Triple Play services over Broadband HFC network. It has chosen best economical and state of art technologies. |
|2. The benefits derived like product improvement cost reduction product development or import substitution. || |
| || Your company uses Cable Modem Technology for high speed Internet access. The Company is also using Metro Ethernet ("MEN") and Ethernet over Cable (EoC) technology which engages different network topology for providing high speed data service at a lower cost. |
|3. In case of imported technology (imported during the last three years reckoned from the beginning of the financial year):- || |
|a. the details of technology imported; || |
|b. the year of import; || Your company has also adopted digital video technology to deliver qualitative video and audio using MPEG-2 and MPEG-4 Technology. Your company has also started FID TV services and offers FID channels to its subscribers in select markets. |
|c. whether the technology been fully absorbed; || Your Company has also introduced high speed broadband technologies such as DOCSIS 3.0 to cater to subscribers who have increased Video led Internet Consumption. FID video content viewings as well as increased download speeds are the main benefits of DOCSIS 3.0 technology. DOCSIS 3.0 allows for a much higher throughput compared to the earlier versions by using multi-channel bonding simultaneously for download/upload. This technology has been widely used in Europe and USA by leading ISPs. |
|d. if not fully absorbed areas where absorption has not taken place and the reasons thereof; || Your company is also using HFC architecture which can easily be converted or upgraded to FTTH. Your company is currently undertaking trial with FTTH for pure data usage. |
|e. The expenditure incurred on Research and Development || |
Your Company does not have any foreign exchange earnings during the year under review.
Your company has been certified and recertified by Bureau Veritas Certification (India)Pvt. Ltd. (BVQI) to confirm with ISO 9001:2008 standardization for both cable and dataservices for Bhubaneswar Cuttack Rourkela and Sambalpur operational sites.
Your company has also received certification from BECIL (TRAI appointed CertifyingAgency) for its digital Encryption and Subscriber Management System of digital services.Your company is the first of its kind in India to receive such certification.
Corporate Social Responsibility
During the year under review your company is committed to contribute towards socialwell-being of the communities through various Corporate Social Responsibility("CSR") initiatives. Company has been undertaking various social works as partof its CSR activities over a period of time. It invests in Social programs for the underprivileged child contributes towards their overall learning and personal growth opensemployment avenues and also it attempts to bring about significant and sustainableimprovements in their standard of living and also promotion of education including specialeducation and employment enhancing vocation skills especially among children womenelderly and differently abled and livelihood enhancement projects. Your company's flagshipCSR activity known as 'Ortel Dayitwa' provides financial support to girl children forcollege education. Ortel Dayitwa encourages girls to pursue education after secondaryeducation with an objective to reduce dropouts after secondary education and also conductsvarious education awareness programs from time to time.
After mandatory applicability of provisions of Section 135 of the Companies Act 2013to the Company in FY2015-16 the Company has constituted a Corporate Social ResponsibilityCommittee of the Board ("CSR Committee").
The Board of Directors of the Company has approved CSR Policy based on therecommendation of the CSR Committee. The CSR Policy of the Company is available on theCompany's web-site and can be accessed in the link www.ortelcom.com
As per the criteria specified under Section 135 of the Companies Act 2013("Act") the Company was mandatorily re
quired to contribute and spent at least Rs. 15.67 lac constituting 2% of average netprofit towards CSR activities during FY 2017-18. However Your Company has contributed andspent Rs.16.00 lacs towards education of poor and under privileged girl child Computerand Internet education and related programs and towards peripheral and environmentaldevelopment. As required under Section 134 of the Act and Companies (Corporate SocialResponsibility Policy) Rules 2014 statement containing the details of CSR expenditure isdisclosed as 'Annexure -5'.
The Company continues and shall continue to contribute towards social wellbeingwell-being in future.
The Company has identified following focus areas for CSR engagement:
Education of poor and under privileged child
Computer and Internet education and related programs
Peripheral and Environmental development Internal Financial Control
Internal Financial Controls are an integrated part of the risk management processaddressing financial and financial reporting risks. The Company has a well laid downproper and adequate internal control system which ensures that all assets are safeguardedand protected and that the transactions are authorized recorded and reported correctly.The Internal Financial Controls with reference to financial statements as designed andimplemented by the Company are adequate.
During the year under review no material or serious observation has been received fromthe Internal Auditors of the Company for inefficiency or inadequacy of such controls.
The Board of Directors has appointed M/s SCM & Associates Chartered Accountants asthe Internal Auditor of the Company. The Internal Auditors independently evaluate theadequacy of internal controls and concurrently audit the majority of the transactions invalue terms. Independence of the audit and compliance is ensured by direct reporting ofInternal Auditors to the Audit Committee of the Board. During the year the Companycontinued to implement their suggestions and recommendations to improve the controlenvironment. Internal Auditors findings are discussed on a quarterly basis and suitablecorrective actions taken as per the directions of Audit Committee on an ongoing basis toimprove efficiency in operations.
The Company has also its own Internal Audit Department. Internal Audit team under theguidance of head of Internal Audit conduct various checks audit and submit their reportto the management and is responsible for implementing adequacy of internal control both interms of financial and operational control.
Policy on Prevention Prohibition and Redressal of Sexual Harassment at Workplace
The Company has zero tolerance for sexual harassment at workplace and has adopted aPolicy that aims to provide protection to employees at the workplace and prevent andredress complaints of sexual harassment and for matters connected or incidental theretowith the objective of providing a safe working environment where employees feel secure.The Company has also constituted an Internal Complaints Committee known as the Preventionof Sexual Harassment (POSH) Committee to inquire into complaints of sexual harassment andrecommend appropriate action.
The Company has not received any complaint of sexual harassment during the financialyear 2017-18.
Personnel Et Industrial Relations
Personnel & industrial relations during the year were cordial & harmonious.
Your Directors state that no disclosure or reporting is required in respect of thefollowing matters as there were no transactions on these items during the year underreview:
Issue of equity shares with differential rights as to dividend voting orotherwise.
Issue of shares (including sweat equity shares) to employees of the Companyunder any scheme save and except Employees' Stock Options Plan referred to in this Report.
The Company does not have any scheme of provision of money for the purchase ofits own shares by employees or by trustees for the benefit of employees.
Neither the Managing Director nor any Directors of the Company receive anyremuneration or commission from its subsidiary.
The Board of Directors would like to express their sincere appreciation for theassistance co-operation and continued support received from the shareholders financialinstitutions banks Government authorities customers vendors and other businessassociates during the year under review. The Board of Directors also wish to place onrecord its deep sense of appreciation for the committed services by all employees of yourcompany and workers.
On behalf of the Board of Directors For Ortel Communications Ltd
|Sd/- ||Sd/- |
|Jagi Mangat Panda ||Jyoti Bhusan Pany |
|Managing Director ||Director |
|Place: Bhubaneswar || |
|Date: 10th August 2018 || |