Your Directors are pleased to present the Thirty Fifth Annual Report and AuditedFinancial Statements of the Company for the financial year ended March 31 2020.
The financial highlights for the year ended March 31 2020 are given below:
| || || || ||(Rs. in Crore) |
| || |
Standalone for the year ended
Consolidated for the year ended
| ||March 31 2020 ||March 31 2019 ||March 31 2020 ||March 31 2019 |
|Total Income ||3653.35 ||3883.22 ||3780.50 ||4009.65 |
|Total Expenditure ||1855.47 ||1747.28 ||1956.88 ||1840.32 |
|Profit before share of profit / (Loss) of || || || || |
|Joint Ventures and tax ||1797.88 ||2135.94 ||1823.62 ||2169.33 |
|Share of profit / (Loss) from a joint venture ||- ||- ||(4.17) ||15.41 |
|Profit before tax ||1797.88 ||2135.94 ||1819.45 ||2184.74 |
|Income tax expense ||426.05 ||741.08 ||433.96 ||751.06 |
|Profit for the year ||1371.83 ||1394.86 ||1385.49 ||1433.68 |
|Profit for the year attributable to: || || || || |
|- Owners of the Company ||- ||- ||1385.16 ||1433.27 |
|- Non- Controlling Interest ||- ||- ||0.33 ||0.41 |
|Other Comprehensive Income || || || || |
|Net other comprehensive income not to be reclassified to profit or loss in subsequent periods ||(0.54) ||(0.54) ||0.18 ||(1.31) |
|Other Comprehensive Income for the year attributable to: || || || || |
|- Owners of the Company ||- ||- ||0.18 ||(1.29) |
|- Non- Controlling Interest ||- ||- ||0.00 ||(0.02) |
|Total comprehensive income for the year ||1371.29 ||1394.32 ||1385.67 ||1432.37 |
|Total Comprehensive Income for the year attributable to: || || || || |
|- Owners of the Company ||- ||- ||1385.34 ||1431.96 |
|- Non Controlling Interest ||- ||- ||0.33 ||0.41 |
|Total comprehensive income for the year ||1371.29 ||1394.32 ||1385.67 ||1432.37 |
|Retained Earnings at the beginning of the year ||4287.86 ||3487.41 ||4373.83 ||3535.73 |
|Interim Dividend ||985.21 ||492.61 ||985.21 ||492.61 |
|Tax on Interim Dividend ||202.51 ||101.26 ||202.51 ||101.26 |
|Retained Earnings at the end of the year ||4471.43 ||4287.86 ||4571.45 ||4373.83 |
|Earnings Per Share (Face Value Rs. 5/-) ||34.81 ||35.39 ||35.16 ||36.38 |
SUMMARY OF OPERATIONS
The Total Income for the year ended March 31 2020 was Rs. 3653.35 crore as againstRs. 3883.22 crore during the previous year ended March 31 2019. Profit Before Tax wasRs. 1797.88 crore as against Rs. 2135.94 crore in the previous year. Profit After Taxwas Rs. 1371.83 crore as against Rs. 1394.86 crore in the previous year.
Your Company one of the largest Television Broadcasters in India operating SatelliteTelevision Channels across five languages of Tamil Telugu Kannada Malayalam and Banglaand airing FM radio stations across India continues to have sustained and increasedviewership of its channels with Sun TV being the most watched channel in India.
M/s. South Asia FM Limited subsidiary of your Company has launched one more FM RadioStation in Agartala on June 8 2019.
In accordance with the Dividend Distribution Policy adopted by the Board and availableon the website of the Company the Board of Directors during the financial year endedMarch 31 2020 declared the Interim Dividends of Rs. 2.50 per equity share (50%) of facevalue of Rs. 5.00 each declared on August 9 2019 and November 12 2019 and Rs. 7.50 perequity share (150%) declared on February 14 2020 and Rs. 12.50 per equity share (250%)of face value of Rs. 5.00 each on March 9 2020 and have not recommended any FinalDividend. The dividend payout would result in a total dividend of 500% i.e. Rs. 25.00per equity share of face value of Rs. 5.00 each for the financial year ended March 312020. (Prev. Year of 250% i.e. Rs. 12.50 per equity share of face value of Rs. 5.00each). The Payout ratio for the year stood at 86.58%.
TRANSFER TO RESERVES
During the financial year 2019 - 20 no amount has been transferred to the GeneralReserve.
DIRECTORS' RESPONSIBILITY STATEMENT
In terms of Section 134 of the Companies Act 2013 your Directors confirm that to thebest of their knowledge and belief:
??In the preparation of the Statement of Profit & Loss for the financial year endedMarch 31 2020 and Balance Sheet at that date ("financial statements") theapplicable accounting standards have been followed along with proper explanation relatingto material departures.
??Appropriate accounting policies have been selected and applied them consistently andmade such judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at the end of the financial year andof the profit of the Company for that period;
??Proper and sufficient care for the maintenance of adequate accounting records inaccordance with the provisions of this Act for safeguarding the assets of the Company andfor preventing and detecting fraud and other irregularities. To ensure this the Companyhas established internal control systems consistent with its size and nature ofoperations. In weighing the assurance provided by any such system of internal controls itsinherent limitations should be recognized. These systems are reviewed and updated on anongoing basis. Periodic internal audits are conducted to provide reasonable assurance ofcompliance with these systems. The Audit Committee meets at regular intervals to reviewthe internal audit function;
??The financial statements have been prepared on a going concern basis.
??Proper internal financial controls were in place and that the financial controls wereadequate and were operating effectively.
??Proper systems are in place to ensure compliance of all laws applicable to theCompany;
CORPORATE SOCIAL RESPONSIBILITY (CSR)
In accordance with Section 135 of the Companies Act 2013 the Company has constituteda Corporate Social Responsibility Committee. The CSR Committee of the Company has approveda CSR policy. The Annual report on CSR activities as required under Companies (CorporateSocial Responsibility Policy) Rules 2014 has been appended in Annexure I to this Report.Further details relating to the Corporate Social Responsibility Committee are provided inthe Corporate Governance Report which forms part of this report.
Your Company has two subsidiaries viz. M/s. Kal Radio Limited and M/s. South Asia FMLimited (SAFM). SAFM is a subsidiary which has been classified as Joint Venture (JV) asper Ind-AS in financial statements of the Company and accounted as per applicable Ind-ASaccounting standard framework. There has been no material change in the nature of businessof the subsidiaries. Shareholders interested in obtaining a copy of the audited annualaccounts of the subsidiary companies may write to the Company Secretary. In terms ofproviso to sub section (3) of Section 129 of the Act the salient features of thefinancial statement of the subsidiaries is set out in the prescribed Form AOC 1 asAnnexure II which forms part of the annual report.
AUDITORS AND SECRETARIAL AUDITORS
At the 32 Annual General Meeting (AGM) held on September 22 2017 the shareholders hadapproved the appointment of M/s. Deloitte Haskins & Sells LLP Chartered Accountants(ICAI Firm Registration No: 117366W/W-100018) as the Statutory Auditors of the Companyfor a term of five years i.e. till the conclusion of 37 AGM to be held in the year 2022.Pursuant to the amendment of Section 139 of the Companies Act 2013 the requirement ofseeking ratification for continuance of the Statutory Auditors at every AGM is no longerrequired and accordingly the Notice of ensuing AGM does not include the proposal ofseeking shareholder's ratification for continuance of Statutory Auditors.
As per the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed Smt. Lakshmmi Subramanian Senior Partner of M/s. Lakshmmi Subramanian &Associates a firm of Company Secretaries in Practice to undertake the Secretarial Auditof the Company. The Secretarial Audit Report for the financial year under review isannexed herewith as Annexure III.
The unmodified / unqualified report of Statutory Auditors and Secretarial Auditorsforms part of this report.
TRANSACTIONS WITH RELATED PARTIES
All Related Party Transactions entered during the year were in Ordinary Course ofBusiness and at Arm's Length basis. No Material Related Party Transactions i.e.transactions exceeding 10% of the annual consolidated turnover as per the last auditedfinancial statement were entered during the year by your Company. Accordingly thedisclosure of Related Party Transactions as required under Section 134(3)(h) of theCompanies Act 2013 in Form AOC-2 is not applicable.
The Policy on Materiality of Related Party Transactions and on dealing with RelatedParty Transactions as approved by the Board is put up on the Company's website and can beaccessed at www.suntv.in.
In pursuance of Section 148 of the Companies Act 2013 read with Companies (CostRecords and Audit) Rules 2014 M/s. S. Sundar & Associates Cost Accountants wasengaged to carry out Audit of Cost Records of the Company for the Financial Year 2019-20.Requisite proposal seeking ratification of remuneration payable to the Cost Auditor formspart of the notice of ensuing Annual General Meeting.
MATERIAL SUBSIDIARY COMPANY
As per Regulation 16 of the Listing Regulations your Company has no materialsubsidiary company whose turnover or net worth exceeds 10% of the consolidated turnoveror net worth respectively of your Company and its subsidiaries in the immediatelypreceding accounting year.
TRANSFER TO THE INVESTOR EDUCATION AND PROTECTION FUND
In terms of Section 125 (2) of the Companies Act 2013 an amount of Rs. 530164 beingunclaimed dividend pertaining to the financial year 2011-12 & 2012-13 had beentransferred during the year to the Investor Education and Protection Fund established bythe Central Government.
None of the Company's directors are disqualified from being appointed as a director asspecified in
Section 164 (2) of the Companies Act 2013.
RETIREMENT BY ROTATION
As per the provisions of the Companies Act 2013 Mr. S. Selvam Non-executive Directorof the Company will retire at the ensuing AGM and being eligible seeks re-appointment.The Board of Directors recommend his re-appointment.
The information on the particulars of director eligible for re-appointment in terms ofRegulation 36(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 has been provided in annexure to the notice convening the Annual General Meeting.
CHANGES IN BOARD OF DIRECTORS
Mrs. Mathipoorana Ramakrishanan was appointed as a Woman Independent Director of theCompany with effect from June 21 2019 and her appointment was regularised in the 34Annual General Meeting held on September 27 2019.
KEY MANAGERIAL PERSONNEL
Pursuant to the provisions of Section 203 of the Companies Act 2013 the Key ManagerialPersonnel of the Company are Mr. R. Mahesh Kumar Managing Director Mr. V.C.Unnikrishnan Chief Financial Officer and Mr. R. Ravi Company Secretary.
During the year there was no change in the Paid-up Share Capital of the Company.However the Company increased its Authorised Capital to Rs. 600 Crore (Rupees Six HundredCrore Only) from Rs. 225 Crore (Rupees Two Hundred and Twenty Five Crore Only) during theFinancial Year through Postal Ballot dated April 26 2019.
CHANGES IN MEMORANDUM AND ARTICLES OF ASSOCIATION:
During the year the Company altered its Memorandum and Articles of Association to bein line with the
Companies Act 2013 through Postal Ballot dated April 26 2019.
CORPORATE GOVERNANCE REPORT MANAGEMENT DISCUSSION & ANALYSIS REPORT AND OTHERINFORMATION REQUIRED UNDER THE COMPANIES ACT 2013 AND SEBI (LISTING OBLIGATIONS ANDDISCLOSURE REQUIREMENTS) REGULATIONS 2015
As required under Regulation 34 and Schedule V of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 (hereinafter referred to as "ListingRegulations") with the Stock exchanges we continue to be a pioneer in benchmarkingour corporate governance policies with the best in the media industry. The report onManagement Discussion and Analysis Corporate Governance as well as the Practicing CompanySecretaries' certificate regarding compliance of conditions of Corporate Governance formspart of the Annual Report.
BUSINESS RESPONSIBILITY REPORT
As stipulated under the Listing Regulations the Business Responsibility Reportdescribing the initiatives taken by the Company from an environmental social andgovernance perspective is attached as a part of the Annual Report and the said report willalso be available on the website of the Company.
PARTICULARS OF EMPLOYEES
Sun TV Network Limited had 1352 employees as of March 31 2020 (previously 1476). Inaccordance with the provisions of Section 197 (12) of the Companies Act 2013 read withRule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014the required information is provided in the Annual Report which forms part of this Report.However as per the provisions of Section 136 of the Companies Act 2013 the AnnualReport is being sent to all the Shareholders of the Company excluding the aforesaidinformation. The said information is available for inspection at the registered office ofthe Company during working hours.
SIGNIFICANT / MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There were no significant or material orders passed by the regulators or courts ortribunals impacting the going concern status and Company's operations in future.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANYBETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THE REPORT
There were no material changes and commitments affecting the financial position of theCompany occurred between the end of financial year to which this financial statementsrelate to and the date of this Report.
EXTRACT OF ANNUAL RETURN
The extract of Annual Return as provided under Section 92 (3) of the Companies Actwill be available on the website of the Company www.suntv.in.
NUMBER OF MEETINGS OF THE BOARD
During the financial year Six Board Meetings were held. The details of meetings arefurnished in the Corporate Governance Report. The intervening gap between the Meetings didnot exceed one hundred and twenty days.
INDEPENDENT DIRECTORS' DECLARATION
All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation16(1)(b) of the Listing Regulations.
POLICY OF DIRECTORS' APPOINTMENT AND REMUNERATION
The Company's policy on Director's appointment and remuneration including criteria fordetermining qualifications positive attributes independence of a director and othermatters provided in Section 178(3) of the Companies Act 2013 is available at theCompany's website www.suntv.in. Further information about elements of remunerationpackage of individual directors are provided in the extract of Annual Return Form MGT - 9.
The Company recognizes that a Board of diverse and inclusive culture is integral to itssuccess. Ethnicity age and gender diversity are areas of strategic focus to thecomposition of our Board. The Board considers that its diversity including genderdiversity is a vital asset to the business. The Board has adopted the Board Diversitypolicy which can be accessed at www.suntv.in.
COMMITTEES OF THE BOARD
The details pertaining to the composition of the various Committees of the Board ofDirectors are included in the Corporate Governance Report which forms part of thisreport.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENT
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statements (NoteNo. 6 & 9).
The information about internal controls is set out in the Management Discussion &Analysis Report which is attached and forms part of this report.
Your Company has not accepted any Deposits from the public in terms of Section 73 ofthe Companies Act 2013 during the financial year under review.
As per the provisions of Section 134 of the Companies Act 2013 and Regulation 21 ofthe Listing Regulations the Board has constituted a Risk Management Committee comprisingof Independent Directors. The Risk Management is overseen by the Risk Management Committeeof the Company on a continuous basis. Major risks identified by the businesses andfunctions are systematically addressed through mitigating actions on a continuous basis.For details please refer to the Management Discussion and Analysis report which form partof the Board's Report.
FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS
The Company has practice of conducting structured induction and familiarizationprogramme of the independent directors as detailed in the Corporate Governance Reportwhich forms part of the Annual Report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
As per Section 177 (10) of the Companies Act 2013 and Regulation 22 of the ListingRegulations the Company has a vigil mechanism to deal with instance of fraud andmismanagement if any. The details of policy are explained in the Corporate GovernanceReport. Policy on Vigil Mechanism is hosted on the website.
PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES
The financial position of each of the subsidiaries is provided in a separate statementAOC 1 attached to the Financial Statement pursuant to first proviso of Section129(3) of the Companies Act 2013 as Annexure II.
INDEPENDENT DIRECTORS' MEETING
As per Regulation 25 of the Listing Regulations a separate meeting of IndependentDirectors was held during the financial year. The detailed information is given in theCorporate Governance Report.
In terms of applicable provisions of the Companies Act 2013 and SEBI ListingRegulations the Board has carried out a formal annual evaluation of its own performancethe directors individually as well as the functioning of its committees. A detailedexplanation has been given in the Corporate Governance Report.
POLICY ON INSIDER TRADING
Pursuant to the provisions of the SEBI (Prohibition of Insider Trading) Regulations2015 as amended the Code of Conduct to regulate monitor and report trading by DesignatedPersons and their Immediate and the policy for fair disclosure of unpublished pricesensitive information has been made available on the Company's website (www.suntv.in).
POLICY ON PREVENTION PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORKPLACE
The Company has zero tolerance for sexual harassment at workplace and has adopted anAnti-Sexual Harassment policy in line with the provisions of the Sexual Harassment ofWomen at workplace (Prevention Prohibition and Redressal) Act 2013 and the Rulesthereunder. During the year under review no complaints on sexual harassment were received.The Company has constituted Internal Complaints Committee with five members to considerand resolve sexual harassment complaints. The Committee met once in the financial yearended March 31 2020.
INFORMATION AS REQUIRED UNDER SECTION 134(3)(m) OF THE COMPANIES ACT 2013 READ WITHRULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES 2014
(A) CONSERVATION OF ENERGY
The Company is engaged in Satellite Television Broadcasting operations and theinformation as intended under Section 134 (3)(m) does not arise.
(B) TECHNOLOGY ABSORPTION ADAPTATION AND INNOVATION
The Company uses the latest high definition (HD) digital technology in broadcasting itsprograms. The outdated technologies are constantly identified and updated with latestinnovations.
(C) FOREIGN EXCHANGE EARNINGS AND OUTGO
| || ||(Rs. in Crore) |
|PARTICULARS ||March 31 2020 ||March 31 2019 |
|Foreign Exchange Earnings ||211.58 ||216.95 |
|Foreign Exchange Outgo ||82.02 ||74.18 |
CONSOLIDATED FINANCIAL STATEMENTS
As required by Indian Accounting Standard Ind-AS 110 & Ind-AS 27 onConsolidated Financial Statements issued by The Institute of Chartered Accountants ofIndia the Audited Consolidated Financial Statements of the Company are attached. TheAudited Consolidated Financial Statements also account for the non-controlling interest ofyour Company's subsidiary.
The Managing Director and the Chief Financial Officer have submitted a certificate tothe Board regarding the financial statements and other matters as required underRegulation 17(8) of the Listing Regulations and the Managing Director has confirmed theCode of Conduct as envisaged in Listing Regulations. In terms of Regulation 34 of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 an Independentprofessional has given a Certificate on Corporate Governance Compliance and a Certificatestating that none of the Directors are disqualified which forms part of the report.
APPRECIATION AND ACKNOWLEDGEMENT
Your Directors take this opportunity to place on record their deep appreciation of thededication hard work solidarity co-operation support and commitment of employees atall levels in maintaining the sustained growth of your Company and remain in the forefrontof media and entertainment business.
Your Directors thank and express their gratitude for the support and co-operationreceived from the Central and State Governments mainly the Ministry of Informationand Broadcasting and the Department of Telecommunication and other stakeholdersincluding viewers producers vendors financial institutions banks investors serviceproviders as well as regulatory and governmental authorities and stock exchanges fortheir continued support.
On behalf of the Board
Kalanithi Maran Chairman
Place : Chennai
Date : August 14 2020