Dear Members,
The Directors have pleasure in presenting the Thirty Sixth Annual Report of Bodhtree Consulting Limited (the “Company” or “Bodhtree”) on the business and operations and the Audited Accounts for the financial year ended 31 March, 2018, together with the Auditors’ Report thereon. Consolidated performance of the Company and its subsidiaries has been referred to wherever required.
1. Financial Summary:
Your Company’s results (Standalone) for the year in comparison with the previous year are given below in a summarized format:
|
Particulars
|
2017-18
|
(Re. in Lakhs) 2016-17
|
|
Income from Operations
|
11449.51
|
7876.16
|
|
Other Income
|
22.95
|
87.62
|
|
Total Income
|
11472.46
|
7963.79
|
|
Operating Expenditure
|
10235.25
|
7397.32
|
|
Profit before depreciation & Tax
|
1237.21
|
566.46
|
|
Depreciation
|
579.28
|
120.39
|
|
Operating Profit
|
657.93
|
446.07
|
|
Prior Period & Exceptional Items
|
0
|
0
|
|
Profit before Tax & Extra-Ordinary Items
|
657.93
|
446.07
|
|
Extra-ordinary Items
|
0
|
0
|
|
Tax Expense / (Reversal)
|
214.98
|
162.12
|
|
Profit (Loss) after tax
|
442.95
|
283.96
|
|
Other Comprehensive Income
|
(12.20)
|
(7.87)
|
|
Total Comprehensive Income
|
430.75
|
276.09
|
2. Company’s Performance:
During the year under review the Company reported a total income of Re. 11472.46 Lakhs against Re. 7963.79 Lakhs in the previous year. The Operating profit amounted to Re. 657.93 Lakhs as against operating profit of Re. 446.07 Lakhs in the previous year. The Company reported profit primarily due to the measures brought in by the management to reduce operational costs without compromising the ability to earn and grow further.
3. General Reserve:
The Company has not proposed to transfer any amount to the general reserve for the Financial Year ended 31 March, 2018.
With the proposed final dividend, the dividend for FY 2017-18 would be Re. 0.75 per fully paid-up equity share of Re. 10/- each (7.5% of the paid-up value) as against the total dividend of Re. 0.50 per equity share (5% of the paid-up value) declared in the previous year 2016-17.
The total dividend outgo would amount to Re. 1.80 crores (including Corporate Dividend Tax), a payout of 41.82 % of total comprehensive income of the Company for the financial year 2017-18.
Pursuant to the provisions of Section 124 of the Companies Act 2013, the Details of unpaid/unclaimed dividends lying with the Company as on the last Annual General Meeting of the Company is available on the website of the Company i.e. www.bodhtree.com under investors section. Shareholders are requested to ensure that they claim the dividend(s) from the Company before transfer to the Investor Education and Protection Fund. The seven year period of “Unpaid and Unclaimed dividend for the year 2016-117” which amounts to Re. 11,49,066/- (Rupees Eleven Lakhs Forty Nine Thousand and Sixty Six only) expires on 26 August, 2024 and the same will be transferred to the “Investor Education and Protection Fund”.
Members holding shares in electronic form may note that bank particulars registered against their respective depository accounts will be used by the Company for payment of dividend. The Company or its Registrars and Transfer Agents, Venture Capital and Corporate Investments Private Limited (“Venture Capital”) cannot act on any request received directly from the members holding shares in electronic form for any change of bank particulars or bank mandates. Such changes are to be advised only to the concerned Depository Participant by the members.
5. Share Capital:
The Paid-up Share Capital of the Company as on 31 March, 2018 is Re. 19,95,82,360/-.
During the year under review, the Company had converted 2425938 - 0.001% Compulsory Convertible Preference Shares on 26 April, 2017 in to 1912069 fully paid up equity shares of the Company and consequently the Paid-up Share Capital of the Company changed to Re. 19,95,82,360. As on 31 March, 2018 there are no outstanding convertible preference shares.
6. Listing of Company’s Equity Shares:
The Company’s Equity shares are listed with M/s. BSE Limited (Stock Exchange), Phiroze JeeJeebhoy Towers, Dalal Street, Mumbai - 400 001.
The Company has paid the Annual Listing Fees to the said Stock Exchange for the Financial Year 2018-19 on 01 June, 2018.
7. Change in the Nature of Business:
There is no change in the nature of the business of the Company during the year under review.
The Company holds more than 20% of total share capital of two other Companies which are M/s. Learnsmart India Private Limited and M/s. Pressmart Media Limited. But there was no Significant Influence shown by the Company on affairs of those Companies. There were no significant and material transactions with those Companies during the period under review. Management of the Company is different from that of those two Companies. Details in this regard are mentioned in Form No. MGT-9 (Extract of Annual Return) which can be accessed at the company’s website www.bodhtree.com under investors section.
As per the provisions of Section 129(3) of the Companies Act, 2013 (the Act) read with Companies (Accounts) Rules, 2014, a statement containing the salient features of the financial statements of the Subsidiary in Form AOC-1 is enclosed as Annexure - IV to this Report.
Performance and financial position of each of the subsidiaries, associates and joint ventures:
As per Rule 8 of Companies (Accounts) Rules, 2014, a Report on the performance and financial position of each of the subsidiaries, associates and joint venture companies of the Company is enclosed as Annexure - IV to this Report.
9. Management Discussion and Analysis:
The Management Discussion and Analysis forms an integral part of this Report and enclosed as Annexure - I and gives details of the overall industry structure, developments, performance and state of affairs of the Company’s business, internal controls and their adequacy, risk management systems and other material developments during the financial year.
10. Extract of Annual Return:
As provided under section 92(3) of the Act, the extract of annual return is enclosed as Annexure - II in the prescribed Form No. MGT-9, which forms part of this report and also can be accessed at the company’s website www.bodhtree.com under investors section.
11. Director’s Responsibility Statement:
Pursuant to Section 134 (5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm that:
i) In preparation of annual accounts for the financial year ended 31st March 2018 the applicable Accounting Standards have been followed along with proper explanation relating to material departures;
ii) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year ended 31st March 2018 and of the profit and loss of the Company for the year;
v) The directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
vi) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors and external consultants, including audit of internal financial controls over financial reporting by the statutory auditors, and the reviews performed by management and the relevant board committees, including the audit committee, the board is of the opinion that the Company’s internal financial controls were adequate and effective during FY 2017-18.
12. Statement on Declaration given by Independent Directors under Section 149(6):
The independent directors have submitted the declaration of independence, as required pursuant to Section 149(7) of the Act stating that they meet the criteria of independence as provided in Section 149(6) of the Act.
13. Details of Directors or Key Managerial Personnel:
During the year, Mr. Kommineni Srinivasa Rao resigned as a Director from the Board of Directors of the Company w.e.f. 25 May, 2017 due to his preoccupations. The Board places on record its sincere appreciation for Mr. Kommineni Srinivasa Rao value addition contributions and fruitful association with the Company and thanks him for providing valuable guidance to the Company during his tenure.
Dr. Krishnan Jayaraman has vacated the office of Directorship w.e.f. 11 May, 2017 due to the reason envisaged in Section 167 (1) (b) of the Companies Act, 2013 i.e. he absents himself from all the meetings of the Board of Directors held during a period of twelve months with or without seeking leave of absence of the Board.
During the year, Mr. Sanjiv Gupta, was re-appointed on retirement by rotation as Non-executive Non-Independent Director by the Members at the 35th Annual General Meeting held on 22 July, 2017.
In accordance with the provisions of Act and the Articles of Association of the Company, Mrs. Lakkimsetti Muneashwari will retire by rotation at the ensuing Annual General Meeting and, being eligible, offers herself for re-appointment.
The aforesaid appointment/re-appointment of Director/s are subject to your approval.
During the year, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than the sitting fees, commission and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.
Pursuant to the provisions of section 203 of the Act, the key managerial personnel of the Company are - Mr. L N Rama Krishna, Managing Director; Mr. Prabhakar Rao Kallur, Chief Financial Officer and Mr. Srikanth Reddy Kolli, Company Secretary. There has been no other changes in the key managerial personnel during the year under review.
14. Number of meetings of the board:
6 (Six) meetings of the board were held during the year. For details of the meetings of the board, please refer to the corporate governance report, which forms part of this report.
15. Board Evaluation:
The board of directors has carried out an annual evaluation of its own performance, board committees and individual directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations 2015 (“SEBI Listing Regulations”).
The performance of the board was evaluated by the board after seeking inputs from all the directors on the basis of the criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc.
The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings, etc.
The board and the nomination and remuneration committee reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the chairman was also evaluated on the key aspects of his role.
In a separate meeting of independent directors held on 14 February, 2018, performance of nonindependent directors, performance of the board as a whole and performance of the chairman was evaluated, taking into account the views of executive directors and non-executive directors. The same was discussed in the board meeting that followed the meeting of the independent directors, at which the performance of the board, its committees and individual directors was also discussed. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.
Criteria for Performance Evaluation:
a. Ability of the candidates to devote sufficient time and attention to his professional obligations as Independent Director for informed and balanced decision making.
b. Adherence to the Code of Conduct in letter and in spirit by the Independent Directors.
c. Bringing objectivity and independence of view to the Board’s discussions in relation to the Company’s strategy, performance, and risk management
d. Statutory Compliance and ensuring high standards of financial probity and Corporate Governance
e. Responsibility towards requirements under the Companies Act, 2013, Responsibilities of the Board and accountability under the Director’s Responsibility Statement.
16. Policy on directors’ appointment and remuneration and other details:
The Company’s policy on directors’ appointment and remuneration and other matters provided in section 178(3) of the Act has been disclosed in the corporate governance report, which forms part of this report.
17. Committees of Board:
Your Company has the following committees namely:
1. Audit Committee
2. Compensation Committee
3. Stakeholder’s Relationship Committee
4. Risk Management Committee
The constitution of all the committees are as per the Companies Act, 2013 and SEBI Listing Regulations. The details of the Constitution are mentioned in Corporate Governance Report, which forms part of this Report.
18. Corporate Governance Report:
Your Company has complied with the requirements of Regulation 17(7), 72 of SEBI (LODR) Regulations, 2015 read with Schedule II & V therein and the Corporate Governance Report including Auditor’s Certificate on compliance with the conditions of Corporate Governance specified in Schedule V(E) is enclosed as Annexure- VII to this report.
19. Consolidated Financial Statements:
The consolidated financial statements prepared and annexed in accordance with the Accounting Standards 21 and 23 as prescribed under Section 133 of the Act, read with Rule 7 of Companies (Accounts) Rules, 2014 and Guidelines issued by Securities and Exchange Board of India (“SEBI”) also forms part of this Report.
As per the provisions of Section 136 of the Act, the Company will place separate audited accounts of its subsidiaries on its website www.bodhtree.com and copy of separate audited financial statements of its subsidiaries will be provided to the shareholders at their request.
20. Internal financial control systems and their adequacy:
The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations.
Various Audit Systems in the Company monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies of the Company. Based on the audit reports, Company undertakes corrective actions in respective areas and strengthens the control. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board periodically.
The Board of Directors of the Company have adopted various policies like Related Party Transactions policy, Whistle Blower Policy and such other procedures for ensuring the orderly and efficient conduct of its business for safeguarding its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information. The details in respect of internal financial control and their adequacy are included in the management discussion & analysis, which forms part of this report.
21. Auditors:
Pursuant to the provisions of section 139 of the Act and the rules framed thereafter, M/s. N K R &Co., Chartered Accountants, were appointed as statutory auditors of the Company from the conclusion of the thirty second annual general meeting (AGM) of the Company held on 23 December, 2014 till the conclusion of the thirty seven AGM to be held in the year 2019, subject to ratification of their appointment at every AGM.
22. Auditors’ report:
The auditors’ report does not contain qualifications, reservations or adverse remarks since the adoption of Ind AS from the F.Y. 2017-18.
23. Directors’ Responses on the Qualifications made by the Auditors:
The auditors’ report does not contain qualifications, reservations or adverse remarks since the adoption of Ind AS from the F.Y. 2017-18.
24. Secretarial Auditor Report:
Pursuant to the provisions of Section 204 of the Companies Act, 2013, and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. P. S. Rao & Associates, Practicing Company Secretaries as Secretarial Auditors to conduct Secretarial audit of the Company for the financial year ended 31 March, 2018.
The Secretarial Audit Report issued by M/s. P. S. Rao & Associates, Practicing Company Secretaries in Form No. MR-3 is enclosed as Annexure - VIII to this Annual Report.
The Secretarial Audit Report does not contain any material qualifications, reservations or adverse remarks except the delayed compliances as required by the various statutes applicable to the Company during period under review.
25. Internal Auditors:
The Board of Directors of the Company have appointed M/s. Srinivas & Poorna, Chartered Accountants as Internal Auditors to conduct the Internal Audit of the Company for the Financial Year ended 31 March, 2018.
26. Risk management:
The board of directors of the Company has voluntarily formed a risk management committee to frame, implement and monitor the risk management plan for the Company. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The audit committee has additional oversight in the area of financial risks and controls. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis.
The development and implementation of risk management policy and various risks, including the risks associated with the economy, regulations, competition, foreign exchange, interest rate etc., are documented, monitored and managed efficiently.
27. Corporate Social Responsibility (CSR):
During the year under review, the Company does not fall under the purview of provisions of section 135 read with Schedule VII of the Companies Act, 2013. Hence the Company has not made any contributions towards CSR Activities.
28. Particulars of loans, guarantees and investments:
The particulars of loans, guarantees and investments have been disclosed in the financial statements, being a part of this Annual Report.
29. Deposits from public:
The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.
30. Transactions with related parties:
Information on transactions with related parties pursuant to section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure - V in Form No. AOC-2 and the same forms part of this report.
The policy on materiality of Related Party Transactions and dealing with related party transactions as approved by the Board may be accessed on the Company’s website www.bodhtree.com.
31. Vigil Mechanism:
In pursuant to the provisions of section 177 (9) & (10) of the Act, and SEBI Listing Regulations, a Vigil Mechanism for directors and employees to report genuine concerns has been established. Protected disclosures can be made by a whistle blower to the Chairman of the Audit Committee. The Policy on vigil mechanism may be accessed on the Company’s website www.bodhtree.com.
32. Remuneration ratio of the directors/ Key Managerial Personnel/ Employees:
Statement showing disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of Annexure- III which is enclosed to this Board Report.
33. Particulars of Employees:
The table containing the names and other particulars of employees in accordance with the provisions of Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms part of abovementioned annexure - III. A statement containing the names of every employee employed throughout the financial year and in receipt of remuneration of Rs. 60 lakh or more, or employed for part of the year and in receipt of Rs. 5 lakh or more a month, under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms part of abovementioned annexure - III which is enclosed to this Board’s Report.
34. Conservation of energy, Technology absorption, Foreign exchange outgo:
The particulars as required to be disclosed pursuant to Section 134(3)(m) of the Companies Act, 2013, read with rule 8 of Companies (Accounts) Rules, 2014, are given to the extent applicable by way of Annexure - VI.
35. Human Resources:
The industrial relations of the Company continued to be harmonious during the year under review.
36. Employees Stock Options Scheme:
The Board in its Meeting held on 14 November, 2016 has approved BCL ESOP-2016 policy to its Employees with 10 Lakh fully paid-up Equity Shares, which were approved by the shareholders in the Annual General Meeting held on 30 September, 2016. The in-principle approval for the said 10 lakh options was obtained from BSE on 04 January 2017. The Company did not grant any options to its employees during F.Y. 2017-18. The details of Employees Stock Options pursuant to section 62 of the Companies Act, 2013 read with Rules made thereunder; and SEBI (Share Based Employee Benefits) Regulations, 2014 and erstwhile SEBI (Employee Stock Options Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 are provided as Annexure - IX to this Report.
37. General:
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
a. Issue of equity shares with differential rights as to dividend, voting or otherwise.
b. Neither the Managing Director nor the Whole-time Director of the Company receive any remuneration or commission from any of its subsidiaries.
c. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company’s operations in future.
d. No material changes and commitments affecting the financial position of the Company have occurred between the end of the financial year and date of report.
Your Directors further state that during the year under review, there were no cases filed/registered pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
38. Acknowledgement:
The directors thank the Company’s employees, customers, vendors, investors and academic institutions for their continuous support. The directors also thank the governments of various countries, Government of India, governments of various states in India and concerned government departments / agencies for their co-operation. The directors appreciate and value the contributions made by every member of the Bodhtree family.
For and on behalf of the Board
For Bodhtree Consulting Ltd
Place: Hyderabad
Date: 30 May, 2018 L N Rama Krishna. K Rajesh
Managing Director Director
DIN: 03623543 DIN: 02727491
|