Your Directors have pleasure in presenting the 25th Annual Report ofSaven Technologies Limited together with the audited financial statements for the yearended March 31 2018. The financial results of the Company are as follows:
1. Financial Results
The Company's financial performance for the year ended March 31 2018is summarised below:
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2. Financials of the Company
The total revenue of the Company for the year ended March 31 2018 wasRs. 985.45 lakhs as compared to Rs.1085.53 lakhs for the previous year. Revenue fromoperations was Rs. 839.51 lakhs as compared to Rs. 983.21 lakhs for the previous year.Other income was Rs. 145.94 lakhs compared to Rs. 102.32 lakhs for the previous year. Theprofit before Tax for the year was Rs. 205.81 lakhs as compared to Rs.259.45 lakhs for theprevious year. The profit after Tax for the year was Rs. 153.87 lakhs as compared to Rs.176.80 lakhs in the previous year. The total Comprehensive Income for the year was Rs.187.86 lakhs as compared to Rs. 218.86 lakhs in the previous year.
As per the provisions of Companies Act 2013 read with rules madethereunder the company has implemented the Indian Accounting Standards for preparing theFinancial Statements from the Financial Year 2017-18.
3. Share Capital
Reduction of Share Capital
During the financial year under review the Hon'ble National CompanyLaw Tribunal Hyderabad approved the Reduction of Share Capital of the company pursuant towhich the Equity Share Capital of Saven Technologies Limited will be Rs.10878748/-(Rupees One Crore Eight Lakhs Seventy Eight Thousand Seven Hundred and Forty Eight only)divided into 10878748 equity shares of Re.1/- (Rupees One only) each reduced fromRs.108787480/- (Rupees Ten Crores Eighty Seven Lakhs Eighty Seven Thousand Four Hundredand Eighty only) comprising of 10878748 equity shares of Rs.10/- each.
There was no change in the total number of shares before and after theReduction of Share Capital. The face value of Rs.10/- was reduced to Re.1/- and Rs.9/- wasreturned to the shareholders who held shares as on the Record date i.e. 20th March 2018.The old share certificates with face value of Rs.10/- were cancelled and new sharecertificates with Re.1/- were dispatched to the shareholders who were holding shares inphysical form as on the record date and for the shareholders who held shares indematerialized form the shares with Re.1/- was credited to their accounts. In connectionwith this corporate action the trading was suspended in BSE Limited with effect from 19thMarch 2018 and resumed on 30th July 2018.
4. Material Changes and Commitments if any affecting the financialposition of the company which have occured between the end of the financial year of thecompany to which the financial statements relate and the date of the report
There are no material changes and commitments affecting the financialposition of the Company.
5. Transfer To Reserves
The company had at the beginning of the financial year an amount ofRs.550 lakhs in the General Reserve. During the financial year 2017-18 the company did nottransfer any amount to Reserves.
Your Directors considered it prudent to conserve the resources of theCompany and as such have not recommended any dividend for the current financial year.
7. Particulars of Loans Guarantees or Investments
The company has not given any loan or guarantee covered under theprovisions of section 186 of the Companies Act 2013 (Act). The details of the investmentsmade by the company are given in the notes to the financial statements.
8. Internal Financial Control Systems and Their Adequacy
The Company has adequate system of internal controls to safeguard andprotect from loss unauthorised use or disposition of its assets. All the transactions areproperly authorised recorded and reported to the Management. The Company is following allthe applicable Accounting Standards for proper maintenance of books of accounts and forfinancial reporting.
9. Related Party Transactions
The transactions with related parties are in ordinary course ofbusiness and at arm's length. Information on transactions with related parties pursuant toSection 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules 2014is given in Annexure-1 in Form AOC-2 and the same forms part of this report.
10. Fixed Deposits
Your Company has not accepted any deposits and as such no amount ofprincipal or interest was outstanding as of the Balance Sheet date.
11. Change in the Nature of Business if any
There is no material change in the nature of business affecting thefinancial position of the Company for the year ended March 31 2018.
12. Joint Venture
Your directors had already communicated in the previous year's Board'sReport that Penrillian Limited a joint venture of your company in UK had commenced theprocess of Creditors Voluntary Liquidation in the month of May 2017. The company wasdissolved on 18th July 2018 as per the records of Companies House UK.
13. Subsidiary Company
The company does not have any subsidiary.
14. Directors and Key Managerial Personnel
During the financial year 2017-18 Mr. Nrupender Rao ceased to beDirector and Chairman with effect from 25th January 2018. Mr. R S Sampath Non-executiveIndependent Director was appointed as Chairman with effect from 01st February 2018.
Mr. Sridhar Chelikani retires as Director by rotation at the ensuingAnnual General Meeting and being eligible offers himself for re-appointment.
Mr. Murty Gudipati was re-appointed as Executive Director and CEO ofthe Company for a period commencing from August 14 2015 to March 31 2018 at the AnnualGeneral Meeting held on 17th August 2015. As his term expired on 31st March 2018 theBoard has proposed for his re-appointment with effect from 01st April 2018 to 31stMarch2021 subject to the approval of members in the ensuing Annual General Meeting of thecompany.
Mr. R S Sampath Independent Director was appointed at 21st AnnualGeneral Meeting held on 22nd September 2014 for a period of four years upto 30thSeptember 2018. As per the evaluation made by the Nomination and Remuneration Committeeand the Board of Directors of the Company the Board of Directors have proposed to extendthe term of appointment of Mr. R S Sampath as Independent Director for second term of fiveyears commencing with effect from 01.10.2018 after considering his experience knowledgeskills and familiarity with the company.
Mr. Avula Bharat Bhushan Independent Director was appointed at 21stAnnual General Meeting held on 22nd September 2014 for a period of four years upto 30thSeptember 2018. As per the evaluation made by the Nomination and Remuneration Committeeand the Board of Directors of the Company the Board of Directors have proposed to extendthe term of appointment of Mr. Avula Bharat Bhushan as Independent Director for secondterm of five years commencing with effect from 01.10.2018 after considering hisexperience knowledge skills and familiarity with the company.
For the perusal of the shareholders a brief resume of the Directorsbeing re-appointed along with necessary particulars is given in the explanatory statementto the notice.
Statement on the declaration given by the Independent Directors as perSection 149(6)
The company has received necessary declaration from each independentdirector under Section 149(7) of the Companies Act 2013 that he /she meets the criteriaof independence laid down in Section 149(6) of the Companies Act 2013 and Regulation 25of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
15. Policy on Directors' Appointment and Remuneration and Other Details
The Board has on the recommendation of the Nomination and RemunerationCommittee framed a policy for selection and appointment of Directors Senior Managementand fixing their remuneration pursuant to the provisions of Section 178 of the Act andSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. The Salientfeatures of the Policy are set out in the Corporate Governance Report and also posted onthe website of the company www.saven.in
16. Number of Meetings of the Board
Eight meetings of the Board were held during the year. The detailspertaining to board meetings are included in the Corporate Governance Report which formspart of this report.
17. Board Evaluation
Pursuant to the provisions of the Companies Act 2013 and SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Board carried out anannual performance evaluation of its own performance the Directors as well as theevaluation of the working of its Audit Nomination and Remuneration and Stakeholders'Relationship Committees. Independent Directors carried out a separate evaluation on theperformance of Chairman and non Independent directors. The manner in which the evaluationhas been carried out has been explained in the Corporate Governance Report.
18. Audit Committee
The details pertaining to composition of audit committee are includedin the Corporate Governance Report which forms part of this report.
At the Annual General Meeting (AGM) held on September 25 2017 M/s.Suryanarayana and Suresh. Chartered Accountants Hyderabad were appointed as StatutoryAuditors of the company to hold office till conclusion of the AGM to be held in thecalendar year 2022. Pursuant to the provisions of applicable provisions of Companies(Amendment) Act 2017 read with the Companies (Audit and Auditors) Second AmendmentRules 2018 effective from 7th May 2018 the provisions related to ratification ofappointment of auditors by the members of the company in every annual general meetingtill the sixth such meeting by way of passing of an ordinary resolution is omitted.
There were no qualifications reservation or adverse remark in theAudit Report for the Financial Year ended 31st March 2018.
Mr. S Chidambaram Company Secretary in Practice Hyderabad wasappointed to undertake the Secretarial Audit of the Company for the Financial Year2017-18. There were no qualifications reservation or adverse remark(s) in the AuditReport for the Financial Year ended 31st March 2018. The Secretarial Audit Report isgiven in Annexure-2.
20. Directors' Responsibility Statement
In terms of Section 134(5) of the Companies Act 2013 your Directorswould like to state that:
a. In the preparation of the Annual Accounts the applicable accountingstandards have been followed along with proper explanation relating to materialdepartures;
b. The Directors have selected such accounting policies and appliedthem consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the Company at the end of thefinancial year ended March 31 2018 and the profit of the Company for that financial year;
c. The Directors have taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of theCompanies Act 2013 for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities;
d. The Directors have prepared the Annual Accounts on a going concernbasis.
e. The Directors had laid down internal financial controls to befollowed by the company and that such internal financial controls are adequate andoperating effectively.
f. The directors had devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively.
21. Details in respect of frauds reported by auditors under sub-section(12) of section 143 other than those which are reportable to the Central Government-NIL
22. Conservation Of Energy Technology Absorption Foreign ExchangeEarnings And Outgo
Conservation of Energy:
The nature of the Company's operations requires a low level of energyconsumption.
Research and Development (R&D):
The Company continues to look at opportunities in the areas of researchand development in its present range of activities.
The Company continues to use the latest technologies for improving theproductivity and quality of its services and products. The Company has not imported anytechnology during the year.
Foreign Exchange Earnings and Outgo:
Foreign Exchange earned by the Company as on March 31 2018 was Rs.972.88 lakhs and as on March 31 2017 was Rs. 901.17 lakhs. The Foreign Exchange outgo forthe company as on March 31 2018 was NIL and as on March 31 2017 was Rs. 4.73 lakhs.
23. Particulars of Employees
(a) The information required under section 197 of the Companies Act2013 read with rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are given in Annexure-3.
(b) Pursuant to Rule 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 and amendments made thereunder duringthe year under review none of the employees of the Company employed throughout thefinancial year was in receipt of remuneration for the year which in the aggregate wasnot less than one crore and two lakh rupees; none of the employees of the Company employedfor a part of the financial year was in receipt of remuneration for any part of the yearat a rate which in the aggregate was not less than eight lakh and fifty thousand rupeesper month; none of the employees of the Company employed throughout the financial year orpart thereof was in receipt of remuneration in the year which in the aggregate or asthe case may be at a rate which in the aggregate is in excess of that drawn by themanaging director or whole-time director or manager and holds by himself or along with hisspouse and dependent children not less than two percent of the equity shares of thecompany.
24. Extract of Annual Return
The details forming part of the extract of the Annual Return in formMGT-9 are given in Annexure-4. The web address where annual return referred to insub-section (3) of section 92 has been placed is www.saven.in.
25. Risk Management
Pursuant to section 134 (3) (n) of the Companies Act 2013 and SEBI(Listing Obligations And Disclosure Requirements) Regulations 2015 the company hasformulated a policy on risk management. At present the company has not identified anyelement of risk which may threaten the existence of the company.
26. Vigil Mechanism / Whistle Blower Policy
Pursuant to Section 177 of the Companies Act 2013 read with Rule 7 ofCompanies (Meetings of Board and its Powers) Rules 2014 and SEBI (Listing Obligations AndDisclosure Requirements) Regulations 2015 the Company has established a Whistle BlowerPolicy to deal with instance(s) of fraud and mismanagement if any. The details of theWhistle Blower Policy are explained in the Corporate Governance Report and also posted onthe website of the Companyhttp://www.saven.in/documents/results/2014-15/Whistle-blower-policy.pdf.
27. Corporate Social Responsibility (CSR)
The provisions relating to Corporate Social Responsibility under theCompanies Act 2013 do not apply to the company.
28. Disclosure under the Sexual Harassment of Women at Workplace(Prevention Prohibition And Redressal) Act 2013
The Company has in place a Policy on Prevention of Sexual Harassment inline with the requirements of The Sexual Harassment of Women at the Workplace (PreventionProhibition &Redressal) Act 2013. Internal Complaints Committee (ICC) has been set upto redress complaints received regarding sexual harassment. All employees (permanentcontractual temporary trainees) are covered under this policy.
Your Directors further state that during the year under review therewere no cases filed pursuant to the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013.
29. The details of significant and material orders passed by theregulators or courts or tribunals impacting the going concern status and company'soperations in future
In terms of sub rule 5(vii) of Rule 8 of Companies (Accounts) Rules2014 there are no significant material orders passed by the Regulators / Courts whichwould impact the going concern status of the Company and its future operations.
30. Management Discussion & Analysis and Corporate Governance
The "Management Discussion and Analysis Report" highlightingthe industry structure and developments opportunities and threats future outlook risksand concerns etc. is furnished separately and forms part of this Board's Report.
As per the requirements of SEBI (Listing Obligations And DisclosureRequirements) Regulations 2015 a Report on Corporate Governance duly audited is annexedfor information of the Members.
Your Directors thank the investors bankers clients and vendors fortheir continued support. Your Directors place on record their appreciation of the valuablecontribution made by the employees at all levels.
For and on behalf of the Board
R S Sampath
Place : Hyderabad Date : August 8 2018