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Team Lease Services Ltd.

BSE: 539658 Sector: Others
NSE: TEAMLEASE ISIN Code: INE985S01024
BSE 15:20 | 08 Mar 3406.05 -22.40
(-0.65%)
OPEN

3437.65

HIGH

3550.80

LOW

3397.55

NSE 15:09 | 08 Mar 3430.95 16.00
(0.47%)
OPEN

3457.65

HIGH

3559.95

LOW

3414.95

OPEN 3437.65
PREVIOUS CLOSE 3428.45
VOLUME 1968
52-Week high 3840.00
52-Week low 1421.35
P/E 183.71
Mkt Cap.(Rs cr) 5,824
Buy Price 3397.85
Buy Qty 2.00
Sell Price 3404.65
Sell Qty 10.00
OPEN 3437.65
CLOSE 3428.45
VOLUME 1968
52-Week high 3840.00
52-Week low 1421.35
P/E 183.71
Mkt Cap.(Rs cr) 5,824
Buy Price 3397.85
Buy Qty 2.00
Sell Price 3404.65
Sell Qty 10.00

Team Lease Services Ltd. (TEAMLEASE) - Chairman Speech

Company chairman speech

Dear Shareholders

The planet country and your company entered financial year 2020 with a very differentlook than it exited the year. COVID is a macroeconomic and civilizational cataclysm whoseconsequences are unmodellable. We are all in the same state and as can be expected anycrisis simultaneously creates pain and opportunities and COVID will be no different.

At the time of writing this letter two unanswered questions - probably unanswerable -linger over the economic recovery. First whether we are at the start middle of end ofthe virus. Second whether consumers and companies will be frugal (save for a rainy day)or be hedonistic (live for today). The contours of the economic recovery - v-shapedu-shaped i-shaped or bathtub shaped - will only become clear when the economicallydebilitating and somewhat blunt economic lockdowns end. Some say this may only be possiblewhen a vaccine emerges. And there is no certainty when it would. Given this uncertaintythis letter is organized into four clusters; macroeconomic challenges company challengesopportunities and strategy.

The macroeconomic challenges caused by COVID for financial year 2021 are substantial.These challenges encompass land labour and capital but it's important to not confuse thesymptoms

- Migrant Labour return MSME solvency Fiscal deficit Bank Stress Wage FreezesUnemployment etc - with the disease. COVID has only highlighted India's pre-existingconditions; inadequate financialization urbanization industrialization formalizationand skilling.

The challenges caused by COVID for TeamLease arise from its impact on our customers inour three clusters of Employment Employability and E-workforce. Customers in employmentin all three segments confront great uncertainty in their growth investment and hiringplans till the outline of the new normal emerges. Our staffing business is highlyconcentrated in sales customer service and logistics which cannot be delivered from home.Our specialized staffing business is less affected because many are cognitiveprofessionals whose employers who embraced working from home for continuity but may stayfor costs and productivity. Our Skill University is affected because employers are holdingback on apprenticeship and corporate training program investments. Our E-workforceofferings are impacted by delays in almost all purchase decision making.

But COVID clearly accelerates or amplifies many long-term trends in our areas ofoperations. Our employment cluster will benefit from companies recognizing that theirresilience increases by variablizing their costs and they should view their structures asa number of concentric circles. Our employability cluster will benefit from increasingrecognition that the human capital investments needed to raise productivity are urgent butoften pay for themselves only in the long run. And our E-workforce cluster will gain fromthe digitization super cycle set-off in all enterprises in their HR plumbing compliancefield force management and learning.

TeamLease continues to target our three goals of growth margin expansion and capitalfrugality. Reaching these goals requires combiningexecutionexcellencewith strategy thatdelivers innovation to expand our addressable markets. Last year we made couple ofacquisitions in specialized staffing division that delivered Rs 101 cr in revenue. Ouroverall performance of Rs 5232 cr revenues resulted in 17% YoY growth in revenues with88% contribution from organic growth. Our EBITDA of Rs 93 cr remained almost flat comparedto prior year but we have managed to improve operating cash flow conversion to EBITDA to77% excluding the impact of withholding taxes. We have maintained funding exposure instaffing business at 14% and consolidated working capital at 17 days of turnover.

Jawaharlal Nehru wrote from Ahmadnagar jail in 1942 "Whether we are successful ornot historians of the future will judge. But we aimed high and looked far".TeamLease like all companies will face substantial challenges in the coming year. But wewill use these challenges to aim high and look far.

Wish us Luck.

Manish Mahendra Sabharwal
Chairman

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