On behalf of the Board of Directors I am happy to present the 31st Board'sReport of your Company with the Balance Sheet and the Statement of Profit and Loss for theyear ended March 31 2019.
The Company's financial performance for the year ended March 31 2019 as compared tothe previous financial year ended March 31 2018 is summarized below:
|Particulars ||Consolidated || ||Standalone || |
| ||2018-19 ||2017-18 ||2018-19 ||2017-18 |
|Revenue from operations ||11334.90 ||9102.69 ||3896.72 ||3378.50 |
|Other Income ||108.12 ||244.32 ||66.49 ||226.43 |
|Total Income ||11443.02 ||9347.01 ||3963.21 ||3604.93 |
|Profit before Interest Depreciation and Tax ||1230.35 ||1064.63 ||547.17 ||660.21 |
|Interest ||47.71 ||40.30 ||34.50 ||34.41 |
|Profit before Depreciation and Tax ||1182.64 ||1024.33 ||512.67 ||634.55 |
|Depreciation ||260.35 ||203.30 ||120.32 ||102.33 |
|Share of profit of joint venture ||8.98 ||22.86 ||- ||- |
|Profit Before Tax ||1147.51 ||843.89 ||392.35 ||523.45 |
|Provision for Taxation ||302.76 ||128.86 ||99.99 ||116.76 |
|Profit After Tax ||844.75 ||715.03 ||292.36 ||406.69 |
|Share of Minority Interest in Profit for the year ||99.68 ||74.18 ||- ||- |
|Profit for the year ||745.07 ||640.85 ||292.36 ||406.69 |
|Balance Brought Forward from Previous Year ||3290.81 ||2637.21 ||1721.80 ||1388.83 |
|Purchase of Non-controlling Interest ||(18.72) ||86.43 ||- || |
|Dividend ||(24.57) ||(73.68) ||(24.61) ||(73.72) |
|Tax on Dividend ||- ||- ||- ||- |
|Transfer to General Reserve ||- ||- ||- ||- |
|Balance Carried Forward ||3992.59 ||3290.81 ||1989.55 ||1721.80 |
The Company has prepared the financial statements in accordance with Indian AccountingStandards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules 2015read with Section 133 of Companies Act 2013 (the Act') and other relevantprovisions of the Act.
There are no material departures from the prescribed norms stipulated by the AccountingStandards in preparation of the Annual Accounts. Accounting policies have beenconsistently applied except where a newly issued accounting standard or a revision to anexisting accounting standard requires a change in the accounting policy hitherto in use.Management evaluates all recently issued or revised accounting standards on an ongoingbasis. The Company discloses consolidated and standalone financial results on a quarterlybasis which are subjected to limited review and publishes consolidated and standaloneaudited financial results on an annual basis.
Overview of Company's Financial Performance
The Company is a global IT and ITeS organization focused on delivering proactive andsmart data to intelligence business solutions helping enterprises across the globe addresstheir business challenges.
We are pleased to inform you that the Company's consolidated revenue has crossed र10000 million for the first time. On a Consolidated basis your Company achieved revenuefrom operations of र 11334.90 million higher by 24.5% as compared to *Rs * 9102.69million in the previous year . The profit after tax for the current year was ` 844.75million registering a growth of 18.1% over ` 715.03 million in the previous year.
The revenue from operations on a standalone basis is र 3896.72 million higher by15.3% as compared to र 3378.50 million in the previous year. The profit after tax forthe current year was र 292.36 million as against ` 406.69 million in the previous year.The profit after tax is reduced primarily due to forex hedging gain accrued and dividendreceived from subsidiary Company in the previous year.
Based on the Company's performance Directors are pleased to recommend for approval ofMembers a final dividend of र 1.00 per share (20%) for the Financial Year 2018-19.
Transfer to Reserves
During the year under review the Company has not transferred any amount to GeneralReserve out of the amount available for appropriation. However credit balance of Profitand Loss of
र 1989.55 million is transferred to Balance Sheet under the head Reserves andSurplus'.
Transfer of Unclaimed Dividend to Investor Education and Protection Fund (IEPF)
In terms of Section 125 of the unclaimed or unpaid Dividend relating to the financialyear 2011-12 is due for transfer on November 29 2019 to the IEPF established by theCentral
Government. More details are available on http://www.datamatics.com/investors/unpaidunclaimed-dividend.
The Shareholders of the Company who have not received or encashed their dividendwarrants are requested to claim the unpaid/unclaimed dividend from the Company before itstransfer to IEPF.
Acceptance of Deposits
The Company has not accepted any deposits during the Financial Year 2018-19 in terms ofChapter V of the Act.
The Company has the following Indian subsidiaries (including the step downsubsidiaries) as on March 31 2019:
1. Cybercom Datamatics Information Solutions Limited
2. Lumina Datamatics Limited
3. Datamatics Digital Limited
4. CIGNEX Datamatics Technologies Limited
5. LDR eRetail Limited
6. Attune Infocom Private Limited
7. Datamatics Staffng Services Limited (w.e.f. March 18 2019)
8. Datamatics Robotics Software Limited (w.e.f. April 09 2018)
9. RJ Globus Solutions Private Limited 10. LD Publishing & eRetail Limited*
The Company has the following overseas subsidiaries (including the step downsubsidiaries) as on March 31 2019:
1. Datamatics Global Services Inc. (US)
2. Techjini Inc (US)
3. Datamatics Infotech Limited (UK)
4. Datamatics Global Services Pty Limited (Australia)
5. Datamatics Global Technologies Limited (Mauritius)
6. Datamatics Global Technologies AG (Switzerland)
7. Datamatics Global Services FZ-LLC (Dubai)
8. Datamatics Global Services Corp. (Philippines)
9. Datamatics Robotics Software Inc (US) 10. Lumina Datamatics Inc. (US) 11. LuminaDatamatics GmbH (Germany)
12. Lumina Datamatics Assessment and Analytics LLC (US) 13. CIGNEX DatamaticsCorporation (BVI) 14. CIGNEX Datamatics Inc. (Michigan) 15. CIGNEX Datamatics GmbH(Germany) 16. CIGNEX Datamatics Pte. Limited (Singapore) 17. CIGNEX Datamatics UK Limited(UK) 18. Duo Consulting Inc. (US) 19. RJ Globus Inc (US) 20. RJ Globus Solutions Inc(Philippines) 21. Datamatics Global Technologies GmbH (Germany)* * In the process ofliquidation/striking o_.
In accordance with Section 129 (3) of the Act the statement containing salientfeatures of the financial statements of the subsidiaries in Form AOC-1 is given in thefinancials section.
Pursuant to the provisions of Section 136 of the Act the Financial Statements of theCompany including Consolidated Financial Statements along with relevant documents andseparate Audited Financial Statements in respect of subsidiaries are available on thewebsite of the Company.
Datamatics Digital Limited (Earlier known as Techjini Solutions Private Limited)
At the beginning of the financial year the Company was holding 71.1% Equity Stake inDatamatics Digital Limited. During the year under review the Company acquired additional10% Equity stake in Datamatics Digital Limited on March 18 2019 and the balance 18.9%equity stake was acquired in the Month of May 2019. With the aforesaid acquisitionsDatamatics Digital Limited has become wholly-owned subsidiary.
Datamatics Digital Limited is a boutique mobile and web application DevelopmentCompany which caters to Fortune 500 companies across business verticals such as mediaengineering manufacturing and start-ups.
Headquartered in Mumbai Datamatics Digital Limited is a leading software servicescompany with presence in United States (US) and has a specialized focus on digitalexperiences mobile based web application development and maintenance services. DatamaticsDigital Limited caters to over 35 companies across business verticals such as mediaengineering manufacturing and start-ups. Datamatics Digital Limited is one of the first13 companies in the world to be certified under the Google Developer Agency Program.
The objective of this acquisition is to further strengthen Datamatics' enterprisemobility offerings through target Company's range of smart technology solutions.
As on March 31 2019 the paid-up share capital of the Company was र 294.75 milliondivided into 58949337 equity shares of *Rs * 5/- each fully paid up. During the yearthere has been no change in the paid- up share capital of the Company.
The authorized share capital of the Company was *Rs * 975.5 million as on March 312019.
Board of Directors and Key Managerial Personnel
Retirement by Rotation.
In accordance with the provisions of the Act and the Articles of Association of theCompany Mr. Sameer L. Kanodia retires by rotation at the ensuing Annual General Meeting("AGM") and being eligible offers himself for re-appointment.
Re-appointment of Mr. Radhakrishna K. Saraswat and Mr. Dilip D. Dandekar as IndependentDirectors of the Company.
The members of the Company had at the 26th Annual General Meeting held onSeptember 23 2014 appointed Mr. Radhakrishna K. Saraswat and Mr. Dilip D. Dandekar asIndependent Directors of the Company for a period of five years with effect from September23 2014. According to their terms the tenure of Mr. Radhakrishna K. Saraswat and Mr.Dilip D. Dandekar as Independent Directors expires on September 22 2019.
On recommendation of Nomination & Remuneration Committee the Board of Directors atits meeting held on May 09 2019 subject to the approval of shareholders at ensuing AGMre-appointed Mr. Radhakrishna K. Saraswat and Mr. Dilip D. Dandekar as IndependentDirectors of the Company for a further period of three years and five years respectivelywith effect from September 23 2019.
A brief profile of Mr. Radhakrishna K. Saraswat and Mr. Dilip D. Dandekar are providedin the Notice of AGM.
Declaration by Independent Directors.
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed under Section 149 (6)of the Act and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 ("SEBI Listing Regulations").
Meetings of the Board
During the financial year six meetings of the Board of Directors were held thedetails of which are given in the Corporate Governance Report of the Company which formsa part of this Report. The maximum interval between any two meetings did not exceed 120days as prescribed under the Act.
Board and Committee Evaluation
The Companies Act 2013 and SEBI Listing Regulations contains broad provisions on BoardEvaluation i.e. evaluation of the performance of (i) the Board as a whole (ii) individualDirectors (including Independent Directors and Chairperson) and (iii) various Committeesof the Board.
Pursuant to the said provisions the Board has carried out the annual performanceevaluation of the entire Board its Committees and all the Directors based on theparameters specified in the Report of Corporate Governance.
A separate meeting of Independent Directors was held to discuss the performance ofNon-Independent Directors Board as a whole and Chairman after considering the views ofExecutive Directors and Non-Executive Directors.
Future Growth Strategy
The financial year 2018-19 witnessed steady growth in its digital business which isattributed to the Company's strong focus on developing proprietary solutions having highinter-operability. These are aligned to our clients' business goals and are intended toserve as growth engines across industry verticals Banking Financial ServicesInsurance Manufacturing Retail Publishing and Transportation to name a few.
Investment in new technologies and product development
For the next 3-5 years Datamatics' growth will be anchored on a two-pronged strategyof striking the right balance between traditional IT and BPM businesses as well as focuson creating innovative solutions through the incubation hub DataLabs.
With the growing demand for customized solutions and enterprises embracing newtechnologies Datamatics is focusing on employing design thinking' at its core whiledeveloping comprehensive and engaging solutions that integrate the back middle and frontoffices. The synergies would be primarily directed towards helping clients create a workculture where the onus is on understanding their end-customer requirements and helpingshared services to keep pace with customer-facing teams. This paradigm shift is towards aholistic end-customer-centric ecosystem that leverages technology to increaseproductivity efficiency and speed as well as optimize operational expenditures.
Digital technologies a super-set of Social Mobility Analytics and Cloud (SMAC)along with Robotics and Artificial Intelligence are creating disruption in the waysbusinesses are run. At the same time digital technologies are creating lots ofopportunities for the businesses. Digital technologies like robotic process automationcloud computing mobility are some of the areas where Datamatics sees lot of opportunity.To address the robotic process automation market opportunities this year Datamaticslaunched the new version of our Robotic Process Automation product TruBot 3.0. Thefeatures of this version makes it extremely user friendly for business users to buildtheir own bots which will enable our customers and enterprises to scale up their RPAprogram. Cloud is another growing area and Datamatics has partnered with leading cloudsolution providers including Amazon Web Services and Microsoft Azure to address theopportunity. Datamatics had acquired TechJini in 2018 which has given it a strong footholdin the Mobility and Web technologies domain and has been doing great work in enterprisemobility and technologies like augmented reality and virtual reality.
Strengthening business to drive sustainable growth
With a focus on expanding operations in existing and new geographies Datamatics isactively focusing on leveraging the partnership model by associating with various OEMsresellers and integrators for faster and deeper penetration of Datamatics' solutions TruBI and TruBot in different markets. The Company aims to further enhance brandvisibility and generate greater revenue through cross-sell and upsell of our comprehensiveofferings to existing clients.
The need for metro rails and Automated Fare Collection is growing across emergingeconomies and India is witnessing a strong demand for these rapid transit systems.Datamatics is the only Company in India to have highly evolved AFC Smart Gates andContactless Gates service offerings and has deployed the fastest AFC system in India withcontact-less smart card ticketing solution at Lucknow Metro Rail Corporation. This yearDatamatics also won Automated Fare Collection contract for Mumbai Metro Line 2A 2B and 7.We see a huge opportunity in the smart city infrastructure development government schemes.
Datamatics will continue to invest in new technologies and product development in thearea of Robotics Artificial Intelligence Mobility and Analytics that will help theirclients stay competitive.
Quality has always been the guiding light for the Company. This has helped us to remainfocused on the goal of ensuring customer delight over the years and to create and maintaina distinct edge over the competitors. The consistent high customer satisfaction ratingsand e_usive customer testimonials bear an eloquent testimony to this commitment forquality. Needless to say quality at Datamatics has not only been a legacy but it has beenstrewn inseparably into its culture custom and character.
The Company believes in the philosophy that quality encompasses and permeates everyaction and thought process. Quality at Datamatics goes beyond product and services andforms an integral part of the Datamatics culture. It would not be an exaggeration to claimthat Quality is the DNA of your company. The industry has always been kind in recognizingthe Company's performance and this year too Datamaticians and Datamatics featuredprominently at various industry platforms by winning prestigious awards.
Your Company is the first and the only I.T. Company to have won the "InternationalAsia Pacific Award" for Quality in services sector. The Award was won againstcompetition from hundreds of companies from 38 countries spread across the worldincluding the US Japan Australia New Zealand Russia Canada China Israel SouthKorea Peru and Mexico. Your Company also won the prestigious "IMC IT Award forQuality". We have won the Global Quality Challenge award of one of the fortune 100organizations for the ninth time. Further significant initiatives of the Company towardsquality are:
Further significant initiatives of the Company towards quality are:
The Company's quality management systems (QMS) that forms the backbone of all theprocesses and the way day-to-day operations are carried out is a very comprehensive androbust standard that draws from a host of international standards and benchmarks. Thisincludes ISO 9001:2015 SEI CMMI ITIL Agile ISO 20000 and so on. The QMS has beensuccessfully assessed and certified for ISO 9001:2015 and SEI CMMi Ver 1.3 high maturitylevel L4. During all the surveillance periodic assessment audits there has been no majornon-conformity observed. All the new centers that we added in the financial year have alsobeen successfully assessed and certified to the above international standards.
As you are aware with the growing complexity of the digital economy the threat on theinformation security and data also increases in terms of complexity and impact. Yourcompany is fully aware of this challenge and we constantly keep upgrading our informationsecurity management systems (ISMS). Our operations and ISMS have been successfullyassessed and are compliant to ISO 27001:2013 SSAE 16 SOC 1 and SOC2 requirements andHIPAA requirements. The Company is in the final stages of renewing its PCI-DSScertification. As you would be aware these standards are extremely important forFinancial Insurance and Healthcare industries.
Our commitment to ensure a robust information security management system for ourcustomers has been bolstered by these certifications. We have implemented SecurityInformation and Event Management (SIEM) solution as well which will further strengthen theInformation security management. There is a conscious thrust on risk management as anorganization strategy and the risks and mitigation plans are reviewed regularly at allpertinent levels.
A lot of thrust has also been put in enhancing the overall project management skills ofour project managers. As you would be aware your company is a Registered EducationProvider (REP) with Project Management Institute (PMI) for imparting Project ManagementProfessional (PMP) trainings. This financial year 15 project managers were certified asPMP. In the next financial year the focus on enhancing these skills will continue.
As you would be aware General Data Protection Regulations (GDPR) the most importantregulation around data privacy in the European Union region came into force last year. Allour contracts with the customers in the EU region have been revised to incorporate therequirements of GDPR. Our processes have been further strengthened around the GDPRrequirements. A dedicated Data Protection Officer (DPO) has been appointed to addressissues if any raised around GDPR compliance. All the relevant employees and managementhave been trained on GDPR principles and requirements. GDPR awareness is an integral partof the employee induction program.
2) Customer Satisfaction Tracking:
Datamatics as part of its commitment to ensure superior customer satisfactionconducts a half-yearly customer satisfaction survey. The wholly automated survey asks thecustomers their feedback on a range of parameters that measure their near and long termperception about the company.
We feel proud to share with you that we continue a stellar performance on this count.Your company scored 5.09 on overall satisfaction rating on a scale of 1-6 1 being thelowest and 6 being the highest. Another highlight of this survey has been that 80% of therespondents have rated us in the top 2 boxes of the rating i.e. extremely satisfied andDelighted. This year we are also focusing on the Customer Experience as the Organizationalfocus area. The results on the same are also extremely encouraging.
Apart from this the more frequent and real time Customer Feedback Capture mechanismthat captures feedback through other formal and informal channels also reports animproving trend in the customer sentiment towards our processes and performance.
3) Continuous Improvement - Lean Six Sigma
The Company has a mature and well-entrenched continuous improvement program. Thisprogram is based on the principles of Lean Six Sigma and Kaizen. The program focuses onmaking our processes more efficient productive accurate and cost effective. The programcontinues to deliver significant benefits to the organization with improvements inproductivity efficiency accuracy and customer satisfaction. Overall 415 Lean Six Sigmaprojects and 1850 Kaizens were successfully completed since 2007.
The Company has about 25 Six Sigma Green Belt and 40 Six Sigma White Belt certifiedprofessionals along with 6 Six Sigma Black Belt and 1 Six Sigma Master Black Beltcertified professionals. The Company spent over 3000 person hours of training aroundcontinuous improvement in the FY 2018-19.
Robotics Process Automation
The Robotics Process Automation ("RPA") practice did exceedingly well in thefinancial year 18-19 as well. It has grown over 100% this year and shall continue toachieve similar growth in the coming years. We now have 200+ RPA Consultants working forclients in USA Europe Middle East and in India and are working with multi-billionorganizations in BFSI Manufacturing and Logistic sector.
We released the latest version of TruBot 3.0 this year which enables our business usersto create the bots on their own without depending on technical knowledge. It has strongsecurity features and a versatile dashboard to manage these bots.
We continued to receive several rewards and recognition for our RPA product TruBot eventhis year. Datamatics has been acknowledged with the CIO Choice 2019 and 2018 award ashonor and recognition for RPA. Datamatics RPA has been awarded as the Best CognitiveTechnology Provider by Computer Society of India. We received special recognition at theIMC Digital Technology Awards for RPA.
We participated in major RPA events across the globe for enhancing the marketvisibility and to generate new leads. We have been invited as key speakers and panelistsat these RPA events besides being present at the booths to exhibit our products andsoliciting enquiries.
Our strong presence in the global events & seminars and continuous engagement havegiven boost to our marketing activities and we got much better coverage by big analystfirms this year.
1. Gartner Recognizes Datamatics In Competitive Landscape: Consulting & SystemIntegration Service Providers For RPA;
2. Gartner Recognizes TruBot In Forecast Snapshot: Robotic Process AutomationWorldwide 2018 Update;
3. TruBot Features In Everest PEAK Matrix Assessment 2018: RPA TechnologyVendor Landscape;
4. Forrester Recognizes Datamatics In Now Tech:RPAServices2018;
5. TruBot Features In IDC's RPA Vendor Assessment 2018;
6. NASSCOM Recognizes TruBot For Cognitive RPA The Future of Automation;
7. TruBot Features In Everest Annual Report 2018 For Robotic Process Automation;
8. TruBot Features In Everest's RPA - Technology Vendor Profile Compendium 2018.
Further in this year we have achieved good success in empanelling the partners for ourRPA program and we are getting a very good response from these channel partners. Aseparate dedicated team has been created to manage these partners and we have appointed 25such partners already globally. These will add to our sales engine besides our directsales.
Human Resources Management and Employee Relations
We strongly believe that people are the most important assets of any organization andare instrumental in the growth of the Company. The mantra of_In your success liesour success' helps us create a culture that promotes innovation and excellence leadingto employee delight and enhanced productivity. We invest in employees support their goalsand provide them a platform to excel and grow. The HR task force is passionate about theirwork and creates a lively work environment by implementing best in class HR practices.
Human Resource Department ('HRD'') with its continued efforts took initiatives tomaintain the best and improve the overall organizational capability and productivity so asto be value driven and future-ready. The global headcount as on March 31 2019 was 10000plus.
The Talent Acquisition Team ensures timely on-boarding at the right cost & qualityacross diverse functions skills and geographies._ The team has been using innovativemethods of hiring with extensive focus towards mapping networking & social media forniche & leadership hiring. The best industry practices are meticulously followedtowards sourcing assessments candidate engagement background verifications compliance& organization branding._
The Talent Acquisition team thoroughly emphasis its role as a catalyst towards businessgoals. The team effectively ensures a thorough screening process which leads to savingtime of the interviewers. Automation helps business with accurate and timely reports. Theteam has made impactful savings in leadership and overall hiring through cost-e_ectivemediums of hiring. On boarding resources on niche skills has built significant customerconfidence.
The Team has embraced Social Media Engagement that has played a key role towardsEmployer Branding Passive Talent Engagement Industry Intelligence and opencommunication.
Learning & Development
The Learning and Development team believes in co-creating a culture of learning andcontinuous improvement along with employees to build and grow the employee's career. Toenhance and upgrade their competencies blended learning opportunities are providedthrough various mediums like training workshops online modules certifications andcross-functional projects both locally and globally.
During the financial year 2018-19 the following learning and development impact wasmeasured across the organization:
Robust induction programs were planned for all new employees to familiarize andsmoothly induct them into the organization;
30+ courses were launched on eShiksha LMS and 2663 members completed thecourses;
L&D team executed 45 WebEx sessions leading to cost savings;
Eagles IX was launched with the objective of bringing the best from eachdepartment and creating cross-functional teams which are mentored to achieve the goalsdefined by the leadership team;
As on date the Company has over 70+ certified Project Management Professional(PMP) professionals who have been trained internally and certified. In the FY 2018-19 15employees got certified in PMP;
Train the Trainer (TTT) program continues to be a cost effective model for theorganization and has resulted in saving and cost effectiveness;
L&D has clocked 289053 Person-hours in the year 2018-19 with averagefeedback of 4.3 out of 5.
The Talent management team supports the management in identifying talents and promotesthe development of all employees. In DGSL talent management has an integrated approachfor providing the right fit and then further providing employees with opportunities fordevelopment identifying high-potential and creating succession planning. The talentmanagement team with the aim to align the people practices with the business needs hascarried out the following activities this year.
Focus Group Discussion & Individual Competency Mapping was conducted tofinalize the critical competencies for all the unique roles across the organization;
Designed half a day workshop Interview like a Pro Interviewingskills' training program for hiring managers/leaders to enable them to conduct CompetencyBased Interviews;
A repository of standardized job description (JD) was developed and is nowavailable on intranet Pulse. This has been developed and made available for all hiringmanagers and leaders to ensure they do not have to re-invent the wheel of writing JDs fromthe scratch;
New Employee orientation is a vital step to acclimatize the new hire to theworking culture and environment of the organization an online portal has been puttogether for the same to equip the new hires with all necessary information;
Training 2.0 and practioners' sessions by in-house experts were designed andexecuted for the Graduate Executive Program (GEP). This year the GEP participants willundergo sponsored higher education program with leading MBA institute which would furtherhone their skills and contribute towards the Company's growth plan;
iCertify program was launched this year. This program provides an onlineplatform for employees to attempt technical assessments and earn certification.
The HR Operations team Partners with Business in every step to ensure successfulexecution of people strategy in line with the dynamic and continuously evolving businessneeds. To ensure our practices and processes are well established and meet the underlinedobjectives the team follows standard processes which are streamlined based on theindustry best practices and ensure continuous communication.
The key initiatives undertaken during the year is highlighted as follows:
Trainee & Apprentice Program: Datamatics has been supporting& encouraging the National Apprenticeship Promotion Scheme (NAPS) and EmploymentPromotion Program (EPP) aimed at skill development and promoting youth employment withlocal economic opportunities. During the FY 2018-19 we hired & trained 1358 suchtrainees under both the programs;
ASK HR: Effective internal tool based query redressal machinery hasbeen evolved and established in the company. Majority of the queries have been disposed ofwithin 3 working days of its receipt;
New Entrant Observation ("NEO"): One to One Sessionconducted by HR for new recruits after completion of 30 days 60 days and 90 days in theorganization. Employees share their experience. The aim of this program is to gatheremployee's feedback on good practices and improvement areas. In FY18-19 we have receivedfeedback from 2145 employees;
Probationary Review: HR collects the performance feedback from themanager post 2-4-6 month's completion of the new joiners. In FY18-19 we have receivedfeedback of 1378 employees;
Euphoria: Monthly meeting is conducted by the HR & businessfunctions which offers the team an opportunity to interact with each other come togetherand celebrate. It provides a platform on monthly basis for the seniors & HRD toprovide updates to have an element of fun together reward & recognize employees allwith a munch & mingle session at the end;
Instant Recognition and Client Appreciation: The R&R program hasgiven good results while recognizing the individual as well as the team performance. Thereward program was one of the key retention tools across the organization. In FY 18-19total 712 awards were conferred to employees;
Engagement Activities: Various wellness financial awareness &fun activities were organized throughout the year through the local JOSH committee acrosslocations. Employees got a chance to showcase & experience the diversity in culture& festivals through a sense of pride collaboration & team work.
The HR team is always on the look out to leverage our in-house talent and buildautomation tools to enhance our overall employee experience positively thereby impactingthe bottom line leading to a cost effective HR model. Below are the HR automationinitiative implemented this year.
NEO: New Entrant Observation tool was automated. It captures thefeedback of all the new joiners;
Pulse Database: The employee database structure was consolidated inPulse with creation of additional relevant data fields;
Competency Platform on e-dialouge: Competency Platform wasbuilt on intranet Pulse under e-dialogue to facilitate the mapping of employees to thedefined roles and the competencies required to succeed in the role.
Disclosure Under Sexual Harassment of Women at Workplace (Prevention Prohibition &Redressal) Act 2013 ("POSH Act")
The Company has always provided a safe and harassment free workplace for everyindividual working in its premises through various policies and practices. The Companyalways endeavors to create and provide an environment that is free from discrimination andharassment including sexual harassment. The Company is actively involved in ensuring thatthe employees/resources are aware of the provisions of the POSH Act and rights thereunder.
The Company has constituted an Internal Committee (IC) as required under POSH Act andthe constitution of the committee is in compliance with the said Act.
The Company has also adopted Anti-Sexual Harassment Policy in place which is in linewith requirements of the POSH Act 2013 and is fully committed to uphold and maintain thedignity of every women executive working in the Company. The Company's Policy provides forprotection against sexual harassment at workplace and for prevention and redressal of suchcomplaints.
Number of complaints pending as on the beginning of the financial year: 0
Number of complaints filed during the financial year: 0
Number of complaints pending as on the end of the financial year: 0
Particulars of Employees
Disclosures with respect to the remuneration of Directors and employees as requiredunder Section 197 of the Act read with Rule 5(1) of Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are annexed as "Annexure A" to this Report.
In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 astatement showing the names and other particulars drawing remuneration in excess of thelimits set out in the said Rules forms part of the report. However having regard to theprovisions of the first proviso to Section 136(1) of the Act the Annual Report excludingthe aforesaid information is being sent to the Members of the Company. The saidinformation is available for inspection at the Registered Office of the Company during theworking hours. Any member interested in obtaining such information may write to theCompany Secretary at the Registered Office and the same will be furnished on request.
Datamatics' Insider Trading Policy for Regulation of Trading by Insiders
Datamatics has formulated an Insider Trading Policy for Directors and employees tocomply with SEBI (Prohibition of Insider Trading) Regulations 2015 (Insider TradingRegulations). This policy is framed adopting the standards set in the Insider TradingRegulations to regulate monitor and report trading by its employees to achievecompliance with the said Regulations
The Insider Trading Policy for Regulation of Trading by Insiders is available on ourwebsite (http://www.datamatics.com/sites/ default/files/insider-trading-policy.pdf )
Directors' Responsibility Statement
Pursuant to Section 134(5) of the Act the Board of Directors to the best of theirknowledge confirms that: (i) in the preparation of the annual accounts for the year endedMarch 31 2019 the applicable accounting standards read with requirements set out underSchedule III to the Act have been followed and there are no material departures from thesame; (ii) they have selected such accounting policies and applied them consistently andmade judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit of the Company for the year ended on that date; (iii) they have taken properand sufficient care for the maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding the assets of the Company and for preventingand detecting fraud and other irregularities; (iv) they have prepared the annual accountson a going concern' basis; (v) they have laid down internal financial controls to befollowed by the Company and that such internal financial controls are adequate and areoperating effectively; and (vi) they have devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems are adequate and operatingeffectively.
The Company has complied with secretarial standards issued by the Institute of CompanySecretaries of India on Board Meetings and Annual General Meetings.
The Company had appointed Mr. Tushar Shridharani Practicing Company Secretary toconduct the secretarial audit for the financial year 2018-19. The Secretarial Audit Reportfor the financial year ended March 31 2019 is annexed as "Annexure B" tothis Report.
As per the requirements of the SEBI Listing Regulations Mr. Tushar ShridharaniPracticing Company Secretary have undertaken secretarial audit of Lumina DatamaticsLimited material unlisted Indian subsidiary of the Company for the FY 2018-19. The AuditReport confirms that Lumina Datamatics Limited have complied with the provisions of theAct Rules Regulations and Guidelines and that there were no deviations ornon-compliances.
Information on Auditors' Observations
1. Statutory Auditors:
The report of the Statutory Auditors on Standalone and Consolidated FinancialStatements forms part of this Annual Report. There are no qualifications reservations oradverse remarks made by the Statutory Auditors in their report.
2. Secretarial Auditor:
The Secretarial Audit Report does not contain any qualification reservation or adverseremark.
Under Section 139 of the Companies Act 2013 and the Rules made thereunder it ismandatory to rotate the statutory auditors on completion of the maximum term permittedunder the provisions of Companies Act 2013. In line with the requirements of theCompanies Act 2013 M/s. M L BHUWANIA AND CO. LLP Chartered Accountants (FirmRegistration No. 101484W/W100197) were appointed as the Statutory Auditors of the Companyto hold office from the conclusion of 29th Annual General Meeting till theconclusion of 34th Annual General Meeting subject to rati_cation byShareholders at each AGM.
In accordance with the Companies Amendment Act 2017 enforced on May 07 2018 by theMinistry of Corporate Affairs the appointment of Statutory Auditors is not required to berati_ed at every Annual General Meeting.
During the year the statutory auditors have confirmed that they satisfy theindependence criteria required under the Companies Act 2013 and other applicableprovisions of law.
Maintenance of Cost Records as Specified by the Central Government Under Sub-Section(1) Of Section 148 of the Companies Act 2013
As per provisions of sub section (1) of Section 148 of the Companies Act 2013 theCompany is not required to maintain cost records.
Details in Respect of Frauds Reported by Auditors Under Sub Section (12) of Section 143other than those which are Reportable to the Central Government
No frauds were reported by auditors under sub-section (12) of Section 143 of theCompanies Act 2013
Pursuant to the SEBI Listing Regulations Report on Corporate Governance for the yearunder review is presented in a separate section. A certificate from M/s. M L BHUWANIA ANDCO LLP confirming compliance of conditions of Corporate Governance as stipulated underthe SEBI Listing Regulations is annexed to this report.
Material changes and commitments if any affecting the Financial Position of theCompany which have occurred between the end of the Financial Year of the Company to whichthe Financial Statements relate and the date of the report
No material changes and commitments affecting the financial position of the Companyhave occurred between the end of the financial year of the company to which the financialstatements relate and the date of this report.
Management Discussion and Analysis
The Management's Discussion and Analysis Report for the year under review asstipulated under SEBI listing Regulation is presented in a separate section.
Composition of the Committees of the Board
There are currently four Committees of the Board as under:
Corporate Social Responsibility Committee;
Nomination and Remuneration Committee;
Stakeholders' Relationship Committee.
Details of all the Committees along with their charters composition and meetings heldduring the year are provided in the "Report on Corporate Governance" a part ofthis Annual Report.
Particulars of Loans Guarantees and Investments
Details of loans guarantees and investments covered under the provisions of Section186 of the Companies Act 2013 are provided in the Notes to Financial Statements whichforms part of this Annual Report.
Contracts and arrangements with related parties
All contracts arrangements and transactions entered by the Company with relatedparties during FY 2019-20 were in the ordinary course of business and on an arm's lengthbasis. During the year the Company did not enter into any transaction contract orarrangement with related parties that could be considered material in accordance with theCompany's policy on related party transactions.
Accordingly the disclosure of related party transactions in Form AOC-2 is notapplicable. However detailed disclosure on related party transactions as per IND AS-24containing name of the related party and details of the transactions have been providedunder financial statements.
The Company has formulated a Policy on Related Party Transactions which is alsoavailable on Company's website athttp://www.datamatics.com/investors/corporate-governance. The Policy intends to ensurethat proper reporting approval and disclosure processes are in place for all transactionsbetween the Company and Related Parties.
The SEBI Listing Regulations mandated the formulation of certain policies for allListed Companies. In compliance with the above requirement all our policies are availableon our website
(http://www.datamatics.com/investors/corporate-governance). The policies are reviewedperiodically by the Board and updated based on need and new compliance requirement.
In addition to its Code of Conduct key policies that have been adopted by the Companyare as follows:
|Name of the Policy ||Brief Description Web Link |
|Whistleblower/Vigil Mechanism ||The Company has formulated and adopted a Whistleblower Policy/Vigil http://www.datamatics.com/sites/ Mechanism for its Directors and Employees to report concerns about default/files/WhistleblowerPolicy.pdf. unethical behavior actual or suspected fraud or violation of Company's Code of Conduct and ethics. |
|Corporate Social Responsibility (CSR) Policy ||The Policy outlines the Company's strategy for bringing about a http://www.datamatics. transformation in the quality of life of people in the society through social com/sites/default/files/CSR- upliftment programs. The CSR vision of our Company is "Employability Policy-DGSL-Final.pdf & Environment". |
|Policy on Material Subsidiaries ||The Policy is framed to determine Material subsidiaries of the Company and http://www.datamatics.com/sites/ to provide governance framework for such subsidiaries of the Company. default/files/Policy-on-Material- Subsidiaries.pdf |
|Related Party Transaction Policy ||Related Party Transactions Policy is framed to ensure the proper approval http://www.datamatics.com/ and reporting of transactions between the Company and its related parties. sites/default/files/Related-Party- Transaction-Policy.pdf |
|Insider Trading Policy ||The Policy provides the framework in dealing with the securities http://www.datamatics.com/sites/ |
| ||of the Company. default/files/insider-trading.pdf |
|Policy for determination of ||The Policy is framed to provide an overall governance framework for http://www.datamatics.com/sites/ |
|Materiality of Events ||determination of materiality of events / information and to ensure timely default/files/Policy-on-determination- and adequate disclosures of material events / information fully fairly of-Materiality-of-Events.pdf correctly and transparently to the concerned authorities. |
|Document Retention and Archival Policy ||The Policy is framed to outline the guidelines for retention and archival for http://www.datamatics.com/sites/ corporate records / documents of the Company. default/files/Document-Retention- and-Archival-Policy.pdf |
Internal Financial Controls
The Board has adopted policies and procedures for ensuring orderly and efficientconduct of its business including adherence to the Company's policies safeguarding itsassets prevention and detection of frauds and errors accuracy and completeness of theaccounting records and timely preparation of reliable financial disclosures.
The Audit Committee is responsible for implementing and maintaining the internalcontrol and periodically reviews the adequacy and effectiveness of the Company's internalcontrol environment and monitors the implementation of audit recommendations includingthose relating to strengthening of the Company's risk management policies and systems.
The Company has adopted accounting policies which are in accordance with IndianAccounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards)Rules 2015 read with Section 133 of the Act and other relevant provisions of the Act.
Risk Management Policy
Risk Management is embedded in Datamatics operating framework. The Company has a dulyapproved Risk Management Policy which lays down broad guidelines for the appropriateauthority to identify assess categorise and prioritise risks in a timely manner andformulate plans for mitigation of such risks.
The Internal Audit function is responsible for assisting the Investment & RiskManagement Committee on an independent basis with full status of the risk assessments andmanagement. Operationally management process to identify key risks across theorganization and prioritise relevant action plans to mitigate these risks.
Corporate Social Responsibility ("CSR")
The brief outline of the Corporate Social Responsibility (CSR) Policy of the Companyand the initiatives undertaken by the Company during the financial year 2018-19 areannexed as "Annexure C" to this Report in the format prescribed in theCompanies (Corporate Social Responsibility Policy) Rules 2014.
Composite Scheme of Arrangement
The Board of Director have at their meeting held on April 27 2018 subject toobtaining the requisite approvals/consents approved the Composite Scheme of Arrangementunder Section 232 read with Section 230 and other applicable provisions of the CompaniesAct 2013 and the rules made thereunder between Delta Infosolutions Private LimitedDatamatics Infotech Services Private Limited Datamatics Global Services Limited and theirrespective shareholders.
As per the directions of the National Company Law Tribunal Mumbai Bench Meeting ofthe equity shareholders of the Company was held on Thursday May 09 2019 at Mumbai toapprove the Composite Scheme of Arrangement.
The requisite majority required under the SEBI Circulars for approval of the Scheme wasnot obtained since the votes cast by the public shareholders of DGSL in favour were lessthan the votes cast against the same. Hence the Scheme was withdrawn.
Demerger and Listing of Lumina Datamatics Limited
The Board of Director have at their meeting held on December 14 2018 subjectto obtaining the requisite approvals/consents approved the Composite Scheme ofArrangement under Section 232 read with Section 230 and other applicable provisions of theCompanies Act 2013 and the rules made thereunder between Lumina Datamatics LimitedDatamatics Global Services Limited
LDR ERetail Limited and their respective shareholders (hereinafter referred to as"Lumina Demerger Scheme").
The National Company Law Tribunal Mumbai Bench had directed the Company to holdMeeting of the equity shareholders of the Company on Wednesday June 19 2019 at Mumbai toapprove the Composite Scheme of Arrangement providing inter alia for approval of LuminaDemerger Scheme.
As per the terms of the Scheme this Scheme was conditional upon a separate CompositeScheme of Arrangement under section 230 to 232 of the Companies Act 2013 for the proposeddemerger and vesting of Demerged Undertaking of Delta Infosolutions Private Limited("Delta") into Datamatics Infotech Services Private Limited ("DISPL")on a going concern basis and thereafter proposed amalgamation and vesting of the residualDelta (post demerger) into Datamatics Global Services Limited ("DGSL") becomingeffective (hereinafter referred to as "Delta Scheme").
However the requisite majority required under the SEBI Circulars for approval of theScheme was not obtained since the votes cast by the public shareholders of DGSL in favourwere less than the votes cast against for the Delta Scheme. Hence the authorisedrepresentatives of Delta Scheme withdrew the Scheme.
Since the conditionality in relation to the approval of the Delta Scheme was not metapplication was filed before the Tribunal for withdrawal of the Lumina Demerger Schemewhich was sanctioned by Tribunal on May 27 2019.
Significant/Material orders passed by the Regulators
There are no significant/material orders passed by the Regulators or Courts orTribunals impacting the going concern status of the Company and its operations in future.
Extract of the Annual Return for the Financial Year ended on March 31 2019 as requiredby Section 92(3) of the Act and Rule 12(1) of the Companies (Management &Administration) Rules 2014 is annexed as "Annexure - D" to this Report and canbe accessed at www.datamatics.com under the Investor' Section.
Conservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo
Details relating to conversation of energy technology absorption and foreign exchangeearnings and outgo as required under Section 134(3)(m) of the Act read with Rule 8(3) ofthe Companies (Accounts) Rules 2014 are mentioned hereunder:
A. Conservation of Energy:
(i) Our Company being in IT & ITES industry our operations are not energyintensive. Adequate measures have been taken to conserve energy.
(ii) The Company has not taken any steps for utilising alternate sources of energy.
(iii) There were no additional capital investment on energy consumption equipments andproposals if any being implemented for reduction of consumption of energy as the natureof the Company's operations entails a very low level of energy consumption.
B. Technology Absorption:
(i) Every effort is made by the Company to update the technological skills of itstechnical staff in order to ensure that they possess adequate skills to enable them toservice the Company's clients.
(ii) The Company has not imported any technology during the year under review.
(iii) The Company is predominantly a service provider and therefore has not set up aformal R&D unit. However it continues to develop software tools and products in itsexisting delivery setup.
C. Foreign Exchange Earnings and Outgo:
Foreign Exchange Earned in terms of Actual Inflows :
र 2555.76 million.
Foreign Exchange Outgo in terms of Actual Outflows :
र 155.05 million.
Your Directors' place on record their deep appreciation to employees customersshareholders vendors bankers financial institutions Governments authorities and otherstakeholders at all levels for their hard work dedication and commitment. Our consistentgrowth was made possible by their hard work solidarity cooperation and support.
For and on behalf of the Board
Dr. Lalit S. Kanodia Place : Mumbai Chairman Dated : May 09 2019 DIN00008050
To the Boards' Report
Information required under Section 197 of the Companies Act 2013 read with Rule 5(1)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is asunder:
(i) Ratio of the remuneration of each Director to the median remuneration of theEmployees of the Company for the financial year 2018-19:
|Sr. ||Particulars ||Ratio to Median |
|No. || ||remuneration |
|Executive Directors || |
|1. ||Dr. Lalit S. Kanodia ||65.46 |
|2. ||Mr. Rahul L. Kanodia ||82.16 |
|3. ||Mr. Sameer L. Kanodia ||16.44 |
|Non-Executive Directors || |
|1. ||Mr. R. K. Saraswat ||2.88 |
|2. ||Mr. Sudhir C. Deshpande ||0.00 |
|3. ||Mr. Shahzaad S. Dalal ||1.18 |
|4. ||Mr. Dilip D. Dandekar ||2.38 |
|5. ||Mrs. Asha L. Kanodia ||2.59 |
|6. ||Mr. Vinay M. Aggarwal ||2.88 |
(ii) The percentage increase in remuneration of each Director Chief Executive OfficerChief Financial officer and Company Secretary in the financial year 2018- 19:
|Sr. ||Particulars ||% Increase in |
|No. || ||remuneration in |
| || ||the FY# |
|1. ||Dr. Lalit S. Kanodia ||5.44 |
|2. ||Mr. Rahul L. Kanodia ||6.05 |
|3. ||Mr. Sameer L. Kanodia ||-31.50 |
|4. ||Mr. R. K. Saraswat ||96.00 |
|5. ||Mr. Sudhir C. Deshpande* ||-100.00 |
|6. ||Mr. Shahzaad S. Dalal ||300.00 |
|7. ||Mr. Dilip D. Dandekar ||62.00 |
|8. ||Mrs. Asha L. Kanodia ||76.00 |
|9. ||Mr. Vinay Agarwal ||96.00 |
|10. ||Ms. Divya Kumat Company Secretary ||42.29 |
|11. ||Mr. Sandeep Mantri Chief Financial Officer ||17.76 |
* Mr. Sudhir C. Deshpande ceased to be a Director w.e.f. March 14 2018. # Includeperformance incentive payment.
(iii) The percentage increase in the median remuneration of _employees in the financialyear: 8.44%
(iv) The number of permanent employees on the rolls of Company: 5159 Employees
(v) The explanation on the relationship between average increase in remuneration andCompany performance:
On an average employees received an annual increase of 13% in India. The individualincrements varied from 5% to 15% based on individual performance. Employees outside Indiareceived wage increase varying from 1% to 2%. The increase in remuneration is in line withthe market trends in the respective countries. In order to ensure that remunerationreflects Company performance the performance pay is also linked to organizationperformance apart from an individual's performance.
(vi) Comparison of the remuneration of the Key Managerial Personnel against theperformance of the Company;
|Aggregate remuneration of Key Managerial Personnel ||43.15 |
|(KMP) in FY 2019 (` in Million) || |
|Revenue (` in Million) ||3896.72 |
|Remuneration of KMPs (as % of Revenue) ||1% |
|Profit before tax (PBT) ) (` in Million) ||392.35 |
|Remuneration of KMP (As % of PBT) ||11% |
(vii) Variations in the market capitalization of the Company price earnings ratio asat the closing date of the current financial year and previous financial year:
|Particulars ||March ||March ||March ||% Change |
| ||31 2019 ||31 2018 ||31 2017 || |
|Market Capitalization ||6071.78 ||6042.31 ||7468.88 ||0.5% |
|( ` in Million) || || || || |
|Price Earnings Ratio ||8.22 ||9.43 ||11.51 ||-12.83% |
(viii) Percentage increase or decrease in the market quotations of the shares of theCompany in comparison to the rate at which the Company came out with the last publicoffer:
|Particulars ||March ||March ||% Change |
| ||31 2019 ||31 2018 || |
|Market Price (BSE) ||103.25 ||110 ||-6% |
|Market Price (NSE) ||103.00 ||110 ||-6% |
(ix) Average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration:
The average annual increase was around 13%.
Increase in the managerial remuneration for the year was 9%
(x) Comparison of the each remuneration of the Key Managerial Personnel against theperformance of the Company:
| ||Dr. Lalit S. ||Mr. Rahul L. ||Mr. Sameer L. ||Mr. Sandeep ||Ms. Divya |
|Particulars || || || || || |
| ||Kanodia ||Kanodia ||Kanodia ||Mantri ||Kumat |
|Remuneration in FY 2019 (` in Million) ||11.14 ||13.98 ||2.80 ||6.72 ||8.52 |
|Revenue (` in Million) || || ||3896.72 || || |
|Remuneration as % of revenue ||0.29% ||0.36% ||0.07% ||0.17% ||0.22% |
|Profit before tax (PBT) (` in Million) || || ||392.35 || || |
|Remuneration of KMP (As % of PBT) ||2.84% ||3.56% ||0.71% ||1.71% ||2.17% |
(xi) The key parameters for any variable component of remuneration availed by theDirectors:
(a) Commission to Chairman & Vice Chairman: The Commission payable toDr. Lalit S. Kanodia and Mr. Rahul L. Kanodia is upto 1% of the net profits of the Companyas computed in accordance with the provisions of the Companies Act 2013.
(b) Incentives to other Executive Directors: The Nomination and RemunerationCommittee evaluates the performance of other Executive Directors. The Committee approvedthe payment of incentives to other Executive Directors based on their performance alignedwith the Company's overall performance.
(c) Commission to Non Executive Directors: The Members have at the AGM ofthe Company held on September 23 2014 approved the payment of commission upto the limitof 0.25% of its net profits of the Company as computed under the applicable provisions ofthe Act. The said commission is decided each year by the Board of Directors anddistributed amongst the Non-Executive Directors based on their attendance and contributionat the Board and certain Committee meetings as well as the time spent on operationalmatters other than at meetings.
(xii) There are no employees who receive remuneration in excess of the highest paidDirector of the Company.
(xiii) Afirmation that the remuneration is as per the remuneration policy of theCompany.
Pursuant to Rule 5 (1) (xii) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 it is afirmed that the remuneration paid to theDirectors Key Managerial Personnel and senior management is as per the RemunerationPolicy of your Company.