Your Directors take pleasure in submitting their 14th Annual Report on the business and operations of your Company together with the Audited Financial Accounts for the financial year ended March 31 2019.
|1. FINANCIAL RESULTS||(? in Lakhs)|
|Particulars||Current year 2018-2019||Previous year 2017-2018|
|Profit Before Taxation||13185||10623|
|Profit After Taxation||8611||6949|
|Other Comprehensive Income||38||41|
|Total comprehensive income for the year||8649||6990|
2. OVERVIEW OF COMPANY'S FINANCIAL PERFORMANCE
During the year under review the Standalone Revenue from Operations & Other Income increased to ? 54 975 Lakhs as against ? 47864 Lakhs in the previous year and the Consolidated Revenue from Operations & Other Income increased to ? 56957 Lakhs as compared to ? 49027 Lakhs in the previous year.
Your Company had a standalone growth with a Net Profit after tax of ? 8611 Lakhs as compared to the Net Profit after tax of ? 6949 Lakhs in the previous financial year and a consolidated growth with a Net Profit after tax of ? 8 295 Lakhs as compared to the Net Profit after tax of ? 7116 Lakhs in the previous financial year.
There have been no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of this Report.
3. REBRANDING OF THE COMPANY
Your Company has refreshed its corporate identity after 55 years with a new logo and tagline `India Khush Hua' after exhaustive research and understanding of emergent trends.
Your Company's new logo comprises a series of overlapping layers in rich Indian colours standing for Shemaroo's promise of offering an imaginative range of zesty Indian content to a diverse group of consumers and the multi-coloured dots signify bursts of energy. The shape of the design elements has been derived from the digital play button. The Company also announced `India Khush Hua' as its new tagline an emotion that emphatically states the joy we bring in people's life with our multi-genre offering. The new identity has received favourable response.
4. SUBSIDIARIES AND ASSOCIATE COMPANIES
During the year under review the Company has incorporated Shemaroo Media & Entertainment LLC a foreign wholly owned subsidiary company at New Jersey United States with an object to expand Company's businesses in the North American region. It Primarily caters to the Indian diaspora audiences residing in the United States and North American region for Company's product and services and to expand business to the nonIndian diaspora by concentrating on genre like Kids Health and Wellness.
As on March 312019 the Company has 6 subsidiaries and 1 associate company. There has been no change in the nature of business of the subsidiaries/associate during the year under review.
Pursuant to Section 129(3) of the Act a statement in Form AOC- 1 containing the salient features of the financial positions of the subsidiaries/associate company forms part of this Report.
Further pursuant to the provisions of Section 136 of the Act the financial statements of the Company consolidated financial statements along with relevant documents and separate audited accounts in respect of subsidiaries are available on Company's website www.shemarooent.com under Investors section.
During the year ended March 31 2019 the Company does not have any material subsidiary companies as defined in the SEBI Listing Regulations. The Policy for determining Material Subsidiaries of the Company is available on the Company's website at www.shemarooent.com under Investors section.
5. MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report is presented in a separate section which forms part of this Report.
Your Directors recommend payment of ? 1.65 per fully paid-up equity share of ? 10 each (i.e. 16.50% of the paid-up equity share capital of Company) as final dividend for the financial year 2018-19 for approval of shareholders at the ensuing Annual General Meeting (AGM).
The final dividend on equity shares if approved by the shareholders would involve a cash outflow on account of ? 540.70 Lakhs including dividend distribution tax.
7. TRANSFER TO RESERVE
The Company proposes to retain the entire amount of ? 8649 Lakhs in the profit and loss account.
8. PUBLIC DEPOSITS
During the Financial Year under review your Company has not accepted any deposits within the meaning of Section 73 of the Act read with Companies (Acceptance of Deposits) Rules 2014.
9. ANNUAL RETURN
Pursuant to the provisions of Section 92 of the Act read with Rule 12 of the Companies (Management and administration) Rules 2014 the extract of Annual Return in Form MGT 9 is enclosed as Annexure `A' to the Board's Report.
10. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Particulars of loans guarantees given and investments made during the year as required under Section 186 and any other provisions of the Act and Schedule V of the SEBI Listing Regulations are provided in Notes 5a & 8c of the Standalone Financial Statements.
11. CREDIT RATING
CARE continued to reaffirm and assigned their rating of CARE A; Stable for Long Term Bank Facilities of ? 280.70 Crore.
12. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/COURTS
During the year under review there were no significant or material orders passed by Regulators/Courts/Tribunals against the Company impacting its going concern status and operations in future.
13. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134(5) of the Act the Board of Directors to the best of their knowledge and ability confirm that:
1. in the preparation of the Annual Accounts for the year ended March 31 2019 the applicable Accounting Standards have been followed along with proper explanation relating to material departures;
2. the Directors have selected such Accounting Policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a fair view of the state of affairs of the Company at the year ended March 31 2019 and of the profit of the Company for that period;
3. proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
4. the Annual Accounts for the year ended March 31 2019 have been prepared on a going concern basis;
5. proper internal financial controls to be followed by the Company have been laid down and that such internal controls are adequate and were operating effectively; and
6. proper systems to ensure compliance with the provisions of all applicable laws has been devised and that such systems were adequate and operating effectively.
14. BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNEL
During the year under review Mr. Gnanesh D. Gala Mr Vasanji A. Mamania Mr. Shashidhar Sinha and Mr. Kirit V. Gala were re-appointed as Independent Non-Executive Directors of the Company through postal ballot declared on March 29 2019 for the second term of 5 years w.e.f. May 26 2019 upto May 25 2024 and not liable to retire by rotation.
Dr. CA Reeta Shah (DIN:07141304) was appointed as an Independent Non-Executive Director of the Company for the first term of five years and will hold office upto March 27 2020. Considering her knowledge expertise and experience in her respective fields and the substantial contribution made by her during her tenure as an Independent Director since appointment the Nomination & Remuneration Committee and the Board has recommended the re-appointment of Ms. Shah as Independent Director on the Board of the Company to hold office for the second term of five consecutive years commencing from March 28 2020 upto March 27 2025 and not liable to retire by rotation.
On the recommendation of the Nomination and Remuneration Committee the Board of Directors of the Company at its meeting held on May 13 2019 change the designation and appoint Mr. Jai Maroo from Non-Executive Director to Executive Director of the Company for a period of 5 years with effect from May 13 2019 liable to retire by rotation of Directors.
Mr. Raman Maroo (DIN: 00169152) Director on the Board is liable to retire by rotation at the 14th Annual General Meeting (AGM) and being eligible has offered himself for re-appointment.
Re-appointment of Dr. CA Reeta Shah Mr. Raman Maroo and Appointment of Mr. Jai Maroo are placed for your approval at the AGM. Your Directors recommend their appointment.
The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Companies Act 2013 and SEBI Listing Regulations.
b. Key Managerial Personnel
The Key Managerial Personnel of the Company as on date are:
|Mr. Raman Maroo||- Managing Director|
|ii.||Mr. Atul Maru||- Jt. Managing Director|
|iii.||Mr. Hiren Gada||- CEO & CFO|
|iv.||Mr. Dipesh Gosar||- Company Secretary & Compliance Officer|
|v.||Ms. Kranti Gada||- Chief Operating Officer|
|vi.||Ms. Smita Maroo||- Sr. VP - Animation Kids Digital L&M|
|vii.||Ms. Mansi Maroo||- Co-producer - Film|
|viii.||Mr. Vinod Karani||- EVP - Broadcast Syndication & Acquisition|
|ix.||Mr. Hemant Karani||- Sr. VP - Studio|
|x.||Mr. Ketan Maru||- Sr. VP - Film Production|
|xi.||Mr. Bipin Dharod||- Sr. VP - Physical Sales & Distribution|
c. Meetings of Board of Directors:
During the year under review the Board met five times. The details of the Board meetings and the attendance of the Directors are provided in the Corporate Governance Report which forms part of this report.
d. Audit Committee
The Audit Committee comprises of Four members. The Chairman of the Committee is an Independent Director. The Committee met four times during the year. The details pertaining to composition of the Audit Committee and terms of reference are included in the Corporate Governance Report which forms part of this Report.
e. Performance Evaluation of the Board
As per the provision of the Act and Regulation 17 of the SEBI Listing Regulations the Board has carried out an annual performance evaluation of its own performance and that of its Committees as well as performance of the Directors individually was carried out internally. The performance evaluation of the Chairman was carried out by the Independent
Directors at a separate meeting of the Independent Directors.
Feedback was sought by way of a structured questionnaire based on criteria approved by the Nomination and Remuneration Committee for
evaluation of performance of Board Committees of Board and Individual Directors. The outcome of the evaluation was shared with the Nomination and Remuneration Committee Board and the Directors expressed their satisfaction with the evaluation process.
f. Familiarisation Programme of Independent
The Company undertook familiarization programme for familiarizing Director's with the Company's operations update of laws and other relevant information which would enable themto take well informed decisions discharge the responsibilities and functions conferred on them. Details of familiarization programme imparted are placed on Company's website at www.shemarooent.com under Investors section.
g. Policy on Appointment and Remuneration
In accordance with the provisions of the Act and the SEBI Listing Regulations the Company has formulated a Policy on Nomination & Remuneration of Directors and Senior Management Employees on the recommendation of Nomination & Remuneration Committee. The main objective of the said policy is to identify person for appointing on the Board and at senior management level of the Company level and composition of remuneration is reasonable and sufficient to attract retain and motivate. The details of the Policy are given in the Corporate Governance Report.
15. AUDITORS AND AUDITORS REPORT
a. Statutory Auditors
M/s. M. K. Dandeker & Co. Chartered Accountants (ICAI Firm Registration No. 000679S) were appointed as Statutory Auditors for a term of 5 years at the 11th Annual General Meeting of the Company held on 26th September 2016 subject to ratification of their appointment at every subsequent Annual General Meeting. Further pursuant to the recent amendment to Section 139 of the Companies Act 2013 effective May 7 2018 ratification by Shareholders every year for the appointment of the Statutory Auditors is no longer required and accordingly the Notice of ensuing Annual General Meeting does not include the proposal for seeking Shareholders approval for ratification of Statutory Auditors appointment
M/s. M. K. Dandeker & Co have expressed their willingness to continue as the Statutory Auditors of the Company and has furnished a certificate of their eligibility and consent under Section 141 of the Act and the rules framed thereunder. In terms of the SEBI Listing Regulations the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the ICAI.
The Report given by the Auditors on the financial statements of the Company is part of the Annual Report. There has been no qualification reservation adverse remark or disclaimer given by the Auditors in their Report. Further Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review.
b. Secretarial Auditors
The Company has appointed M/s. Manish Ghia & Associates Practicing Company Secretary to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is given as an annexure to this report.
The Secretarial Compliance Report for the financial year ended 31st March 2019 in relation to compliance of all applicable SEBI Regulations/circulars/guidelines issued thereunder pursuant to requirement of Regulation 24A of Listing Regulations was submitted to the Stock Exchange(s).
There are no qualifications or reservations or adverse remarks in the Secretarial Audit and Secretarial Compliance Report issued by them for the financial year 2018-19.
16. RELATED PARTY CONTRACTS OR ARRANGEMENTS
All Related Party Transactions executed in financial year 2018-19 were on arms' length basis and in the ordinary course of business. All related party transactions are placed before the Audit Committee for their prior approval and the details of the related party transactions undertaken during a particular quarter are placed at the meeting of the Audit Committee held in the succeeding quarter.
During the year there were no related party transactions which were materially significant and that could have a potential conflict with the interests of the Company at large. Accordingly there are no transactions that are required to be reported in Form AOC 2. All related party transactions are mentioned in the notes to the accounts.
The policy on Related Party Transactions as approved by the Board is placed on the company's website at www.shemarooent.com under Investors section.
17. MANAGERIAL REMUNERATION AND PARTICULARS OFEMPLOYEES
The disclosure with respect to remuneration as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is appended as Annexure `B' to the Board's Report.
The information as per Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 forms part of this Report. However as per Section 136(1) of the Act the Annual Report and Financial Statements are being sent to the shareholders of the Company excluding the aforesaid information. The said information is available for inspection by shareholders at the Registered Office of the Company during working hours for a period of 21 days before the ensuing Annual General Meeting and shall be made available to any shareholder on request.
18. INTERNAL CONTROL SYSTEM AND COMPLIANCE FRAMEWORK
The Company's Internal Control System are commensurate with nature of its business size scale and complexity of its operations. Internal auditing of the Company involves the utilisation of a systematic methodology for analysing business processes or organisational problems and recommending solutions to add value and improve the processes. The audit approach verifies compliance with the regulatory operational and system related procedures and controls. It includes control processes both on manual and IT applications including the ERP application wherein the transactions are approved and recorded. Such controls have been assessed during the year under review taking into consideration the essential components of internal controls.
The Company has also appointed M/s Gawande & Associates Chartered Accountants Internal Auditors of the Company. It formulates the audit plan scope functioning and methodology which are reviewed every year in a manner that they cover all areas of operations. The Audit Committee periodically deliberates on the operations of the Company with the Members of the Management. Reports of the internal auditors are regularly reviewed by the management and corrective action is initiated to strengthen the controls and enhance the effectiveness of the existing systems. Significant audit observations and follow up actions thereon are reported to the Audit Committee.
19. RISK MANAGEMENT
The Company has in place a Risk Management Policy pursuant to the provisions of Section 134 of the Act and Regulation 17 of the SEBI Listing Regulations. The Company has a robust organisational structure for managing and reporting on risks.
The Senior management periodically reviews the risk management framework to keep updated and address emerging challenges. Risk assessment and management procedures and status are discussed at the meetings of the Audit Committee and the Board of Directors of the Company.
In terms of Regulation 21 of the SEBI Listing Regulations the Constitution of Risk Management Committee was not applicable during the financial year 2018-2019.
20. WHISTLE BLOWER POLICY/VIGIL MECHANISM
The Vigil Mechanism as envisaged in the Act and the SEBI Listing Regulations is implemented through the Company's Whistle Blower Policy provides formal vigil mechanism to the Directors and employees to report their concerns about unethical behaviour actual/suspected fraud or wrongful conduct within the Company. The Policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.
The details of the Whistle Blower Policy are available on the website of the Company at www.shemarooent.com under Investors section.
21. TRANSFER OF UNCLAIMED DIVIDEND/SHARE APPLICATION MONEY DUE FOR REFUND TO IEPF
Pursuant to applicable provisions of Section 124 and 125 of the Act read with the Investor Education and Protection Fund Authority (Accounting Audit Transfer and Refund) Rules 2016 all unpaid or unclaimed dividends are required to be transferred by the Company to the Investor Education and Protection Fund (IEPF) established by the Central Government after completion of seven years. Further according to the Rules the shares in respect of which dividend has not been paid or claimed by the Members for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority.
Shareholders who have not claimed their dividend warrants or share application money due for refund are requested to immediately send their request for issue of duplicate warrants.
The details of unclaimed dividend/application money as on March 312019 are as follows:
|Sr. No.||Particular||Date of declaration||Due date for transfer to IEPF|
|1.||Unclaimed Final Dividend for FY 2017-2018||11.09.2018||17.10.2025|
|2.||Unclaimed Final Dividend for FY 2016-2017||27.09.2017||02.11.2024|
|3.||Unclaimed Final Dividend for FY 2015-2016||26.09.2016||01.11.2023|
|4.||Unclaimed Final Dividend for FY 2014-2015||21.09.2015||28.10.2022|
|5.||Unclaimed Application Money||27.09.2014||27.09.2021|
Th e Company h as placed on its website www.shemarooent.com. the information on dividends and application money which remain unclaimed with the Company. The information is also available on the website of the Ministry of Corporate Affairs i.e. www.mca.gov.in.
22. ISSUE OF EQUITY SHARES WITH DIFFERENTIAL RIGHTS
During the year under review the Company has not issued equity shares with differential rights as to dividend voting or otherwise.
23. CORPORATE GOVERNANCE
The Company has complied with the corporate governance requirements as stipulated under SEBI Listing Regulations. The Report on Corporate Governance alongwith Certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance as stipulated under the SEBI Listing Regulations is annexed and forms part of this Report.
24. COMPLIANCE WITH SECRETARIAL STANDARDS:
The Company has complied with the Secretarial Standards issued by the Institute of Company Secretaries of India on Board Meetings and Annual General Meetings.
25. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
The information relating to the Conservation of Energy and Technology Absorption required under Rule 8(3)(A) and 8(3)(B) of Companies (Accounts) Rules 2014 are not applicable to the Company due to the very nature of the industry in which it operates. However we endeavour to support the environment by adopting environment friendly practices in our office premises.
In view of the nature of activities which are being carried on by the Company the information in connection with technology absorption is Nil.
The particulars regarding foreign exchange earnings and outgo during the year are given in Note 27.2 of the Standalone Financial Statements forming part of this Report.
26. HUMAN RESOURCES
At Shemaroo we consider our employees as the most valuable resource and ensure strategic alignment of Human Resource practices to business priorities and objectives. The Company takes pride in the commitment competence and dedication of its employees in all areas of the business. Attracting developing and retaining the right talent will continue to be a key strategic imperative and the organization continues its undivided attention towards that.
Your Company has well laid down objective and transparent processes for Recruitment Selection Performance Management and Talent Management. To maintain its competitive edge in a highly dynamic industry it recognizes the importance of having a work force which is consumer-focused performance-driven and future-capable. The Company is committed to nurturing enhancing and retaining its top talent through superior learning and organizational development.
The total employee strength at the end of financial year 2018-19 is 591.
27. SEXUAL HARASSMENT
The Company has in place policy for the prevention of sexual harassment at workplaces in line with the requirements of the Women at Workplace (Prevention Prohibition & Redressal) Act 2013 and Rules made thereunder and conducted sessions for employees across the organization to sensitise employees and build awareness on Prevention of Sexual Harassment at work place. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. During the year under review no complaints were received in regards to sexual harassment.
28. CORPORATE SOCIAL RESPONSIBILITY
The Company has constituted a Corporate Social Responsibility (CSR) Committee in accordance with Section 135 of the Companies Act 2013. The role of the committee is to review the CSR Policy indicate activities to be undertaken by the Company towards CSR and formulate a transparent monitoring mechanism to ensure implementation of projects and activities undertaken by the Company towards CSR.
A brief outline of the CSR Policy of the Company the CSR initiatives undertaken during the financial year 2018-19 together with progress thereon and the report on CSR activities as required by the Companies (Corporate Social Responsibility Policy) Rules 2014 are set out in Annexure `C' to the Report.
The CSR policy is available on our website at www.shemarooent.com under Investors section.
29. CAUTIONARY STATEMENT
Statements in the Annual Report particularly those which relate to Management Discussion and Analysis describing the Company's objectives projections estimates and expectations may constitute `forward looking statements' within the meaning of applicable laws and regulations. Although the expectations are based on reasonable assumptions the actual results might differ substantially or materially from those expressed or implied. Important developments that could affect the Company's operations includes but not limited to changes in exchange rate fluctuations tax laws litigation labour relations interest costs political and economic environment.
Your Directors take this opportunity to express their sincere appreciation for the support and co-operation extended by the shareholders customers bankers financial institutions government authorities and other business associates.
The Board of Directors also gratefully acknowledge the exemplary contribution made by the employees of the Company at all levels. Their dedicated efforts and enthusiasm have been pivotal to your Company's growth. The Board of Directors would also like to thank all stakeholders for the continued confidence and trust placed by them with the Company. We look forward to continued support of all these partners in progress.
For and on behalf of the Board of Directors
|Raman Maroo||Atul Maru|
|Managing Director||Jt. Managing Director|
|DIN: 00169152||DIN: 00169264|
|May 13 2019|