ITI Directors Report, ITI Reports by Directors


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Directors Report Year End : Mar '16    Mar 15


The Members

ITI Limited

The Directors have pleasure in presenting the 66th Annual Report of the Company together with Audited Accounts and Auditor''s
Report thereon for the year ended 31st March 2016.


The Company has achieved Sales of Rs,1253.34 Crore comprising of Services of Rs, 563.76 Crore and Production of Rs, 689.58 Crore
during the year 2015-16 against Sales of Rs, 619.81 Crore comprising of Services of Rs, 414.99 Crore and Production of Rs, 204.82
Crore during the previous year 2014-15. The Company could achieve this turnover in spite of the fact that our major customers
BSNL and MTNL have not placed orders like earlier years. The net profit of the Company for the year 2015-16 is Rs, 251 Crore
against the loss figure of Rs, 297 Crore for the year 2014-15, which however, was after considering a grant of Rs, 494 Crore by
the Government.

After a continuous loss for the last 14 years, your Company has achieved its first turnaround profit of Rs, 251 Crore taking into
account the grant in aid received from the Government of India for revival.

The contribution (net of material cost) for the year is Rs, 201 crore, which is comparable for that of previous year at Rs, 172


The Cabinet Committee on Economic Affairs (CCEA), during February 2014, has approved a Revival plan for ITI with a funding
support of Rs, 4156.79 Crores. This package consists of Rs, 2264 Crores as equity for capital expenditure for up-gradation of
manufacturing infrastructure in all the plants of ITI for implementation of new projects and Rs,1892.79 Crores as grant-in- aid
to clear part of liabilities. Out of Rs, 2264 Crores, Government had already released Rs,192 Crore as first phase disbursement to
the Company towards capital expenditure and has made an allocation of Rs, 80 Crores for capex for the year 2016-17.

The infrastructure up-gradation for implementation of various projects is completed at different plants of ITI and the projects
are under implementation. This support from the Government will help ITI to enter into manufacturing of products in different
market domains in a big way.

Under Revival plan, several projects have been planned for implementation at various manufacturing plants of ITI. In addition to
telecom products like G-PON (recently ITI has won the tender from BBNL for the supply of G-PON equipments with C-DoT technology),
MLLN, Broadband equipments etc., major thrust has been given for the manufacture of encrypted telecommunication equipments
required for Defence sector. ITI has also taken up diversified products like Solar panel manufacturing, Smart card manufacturing
and Data center. ITI has already established HDPE manufacturing line at Raebareli plant. ITI is also planning to manufacture OFC
cables, Optic fber manufacturing, Li-Ion batteries, Wi-f solutions, Low power BTS, establishment of ITI''s own Data center,
contract manufacturing activities for VSSC and other PSUs., The other products identified for manufacture are Antenna, Radio
modems, Smart Jammers, Anti intrusion systems, Set top box, Smart energy meters etc.,

Against the CCEA approval of Rs,1892.79 Crores as grant-in-aid, the Government has so far (as on 31.07.2016) released Rs,1004.02
Crores towards establishment cost, payment of statutory dues and 1997 wage revision arrears to the employees.


The turnover for the year 2015-16 is mainly constituted from Network For Spectrum (NFS), National Population Register (NPR), NGN,
AMC for GSM-SZ, GSM-WZ, OCB, MLLN & ASCON, Defence and IT Solutions.

The Company is executing the turnkey NFS Project for BSNL worth Rs,2984 Crore which involves procurement, Supply, trenching,
laying, Installation, testing and maintenance of Optical Fiber Cable, PLB Duct and accessories for construction of exclusive
Optical NLD backbone and Optical access routes on turnkey basis in the Eastern and North- eastern region of the country. Out of
the total of 13500 kms cable laying, nearly 6000 kms have been laid in both F and G Packages.


(Rs, in Crore)

2015-16 2014-15

(including (including

Sl. Product/Project ED & ED &
Service Service
Tax) Tax)

1 NFS cable laying 535.28 0.00

2 ROs / CCO / IT 145.03 158.09

3 Defence / ASCON 117.93 81.72

4 NPR/SECC Projects 104.63 51.10

5 GSM - WZ (Incl. BTS, 88.43 19.72
RTT, Shelter & AMC )

6 GSM - SZ 65.11 48.30

7 NGN 63.22 47.49

8 MLLN 42.64 38.42

9 OCB AMC Business 31.46 36.86

10 Misc. Services 29.50 29.03

11 Data Centre 13.96 11.56

12 SMPS 6.77 5.75

13 G-PoN 6.66 14.83

14 GSM - MTNL 2.16 5.43

15 PCM MUX 0.48 1.73

16 WLL-CDMA Infra 0.08 0.00

17 Diversified Products/ 0.00 68.40

18 SIM / USIM / SMART 0.00 0.89

19 C-DOT Products 0.00 0.34

20 Solar Panel 0.00 0.15

Total 1253.34 619.81


- Next Generation Network (NGN)

ITI Bangalore plant successfully executed the purchase order worth Rs, 63.22 Crores. for NGN products received from BSNL.

- National Population Registration (NPR) and Socio Economic & Caste Census (SECC) projects ITI is one among the consortium of
three PSUs (other two PSUs being M/sBEL &M/s ECIL)for the execution of prestigious National Population Register(NPR) Project
under Ministry of Home Affairs (MHA). The job involves collection of citizen data including biometrics which is under execution.
The above consortium is also executing SECC project for the Ministry of Rural Development (MoRD).


ITI has implemented GSM Projects in BSNL West Zone and MTNL-Mumbai in technology alliance with M/sAlcatel-Lucent & in South Zone
in technology alliance with M/s Huawei. The Annual Maintenance Contract related works have been carried out in these zones.

- Defense projects

ITI is the leader in supplying encryption equipments for the secured communication in the Defense networks. In the year 2015-16,
ITI had executed orders from Defense sector for IP encryptions, NGN (BU), 5C telephone instruments etc.

- Fiber Cable Laying for Network for Spectrum (NFS)

ITI Limited is executing the NFS Cable laying Project in Eastern and North Eastern states of the country. The project is divided
into 2 packages viz. Package F and Package G. Package F executed by Mankapur Unit covering six states viz., West Bengal, Bihar,
Jharkhand, Chhattisgarh, Sikkim and Assam. Package G is executed by Rae Bareli Unit in North Eastern states. This is a turnkey
project for Defense tendered by BSNL which involves trenching, ducting and laying of optical fiber cable for 13500 kilometers.
The total PO value is Rs, 2111Crores (excluding AMC). Out of this the Rae Bareli has a PO worth Rs,1267 Crores. Out of this,
cable laying and services work worth Rs, 274.36 Crores have been completed by Rae Bareli unit during the year. Mankapur Unit has
a PO worth 844 Crores. Out of this, cable laying and services work worth Rs, 260.93 Crores have been completed during the year.

- Switch Mode Power Supply (SMPS)

ITI Rae Bareli Plant is manufacturing SMPS systems and executing the orders from BSNL / MTNL. For the first time, Rae Bareli
Plant has taken TSEC of 25A indoor/outdoor, 50A indoor/ outdoor and 100A SMPS Power Plant and upgraded manufacturing line of SMPS
Power Plant.

- Data Center & IT Projects

ITI has already established Tier 3 state-of- art Data center at Bangalore on PPP model. Presently, this Data Center is fully
booked for co- location services. ITI is also playing a major role in implementing IT projects. The Government is pursuing
E-Governance projects for taking the benefit of IT to the Village Panchayats and a substantial budget provision has been made by
the Government for the same. ITI is aggressively pursuing this market segment. ITI has executed SWAN (State Wide Area Network)
projects of Maharashtra, Odisha and Mizoram. ITI is also executing Accelerated Power Development and Reform Programme (APDRP) of
Tamil Nadu state.

- Maintenance Contracts

ITI had earlier established the ASCON network for Indian Army. ITI was also the major supplier of fixed line switches to BSNL and
MTNL. Currently, ITI has been extending maintenance assistance to Indian Army for ASCON and to BSNL and MTNL for OCB exchanges,
MLLN and STP Networks under Annual Maintenance Contracts.


The performance of the Company for the year 2015-

2016 as compared to the previous year is as follows:

(Rs,. in Crore)

SI. Particulars 2015-2016 2014-2015
i. Sales including 1253 620

ii. Value of 1253 618

iii. Loss/Profit before 251 (297)

iv. Loss/Profit after 251 (297)

v. Financing 157 157

vi. Depreciation 13 15

vii. Capital Employed 460 1112
(Net Fixed Assets
working capital)

viii.R&D Expenditure 16 13


The Cabinet Committee on Economic Affairs (CCEA), on 24th February 2014 has approved financial assistance, based on the
recommendations of Board for Reconstruction of Public Sector Enterprises (BRPSE) to an extent of Rs, 4156.79 crore for the
revival of the Company. The fund infusion will be capital grant of Rs, 2264 crore in the form of equity and the balance amount of
Rs, 1892.79 crore in the form of grant-in-aid.

The Company has received Rs,192 crores from Ministry of Communications and IT for meeting the expenditure towards CAPEX
implementation of various projects in its various plants, during February 2015.

The paid up Equity Share Capital as on 31st March 2016 was Rs, 288,00,00,000.

During the year under review, the Company has not issued shares or granted stock options or sweat equity.

As on 31st March 2016, none of the Directors of the Company hold any shares of the Company.

Government of India vide letter no.20-36/2012- FAC- II dated 20-07-2016 has communicated the approval of Cabinet Committee on
Economic Affairs to transfer requisite number of shares of President of India to Special National Investment Fund to meet SEBI''s
Minimum Public Shareholding requirement. The Board of Director in its meeting held on 11.08.2016 has approved allotment of
19,20,00,000 equity shares of Rs, 10 each at par amounting to Rs, 192,00,00,000 to President of India.


As your Company still have accumulated losses the Directors are not in a position to recommend any dividend for the year



Bangalore Plant achieved a turnover of Rs, 158.17 crs (with ED & Service tax) and the net turnover of Rs, 148.60 crs.

Projects / Major orders successfully completed in FY 2015-16

The supply consisted of NGN supplies worth Rs, 63.22 crs under the Government''s prestigious Digital India Initiative. Under
services, the unit executed Rs, 65.11 crs for GSM-SZ AMC, Rs, 8.6 crs for Defense AMC, Rs, 0.09 crs for CDMA WLL AMC and Rs,
13.97 crs for Data Centre Business.

The Unit also supplied Defense Equipments worth Rs, 3.82 crs, ISAT for CRPF – Rs, 1.23 crs, Telephones for Defense and BSNL worth
Rs, 0.47 crs; Primary MUX for BSNL for Rs, 0.45 crs, Contract Manufacturing and Reliability Lab services Rs, 0.9 crs and Spares
Rs, 0.07 crs.

Future outlook

Bangalore Plant addressed apprx Rs, 6000 Crs worth major tenders during the year viz. ASCON Phase IV - Main & Secrecy, NFS
Secrecy, Defense telephones, ARC & ARI Cards for CDOT ANRAX, Flexi Encryptions for NTRO, Bulk Encryptions for Defense, IP
Encryptions for Assam Rifes, PCM MUX cards for BSNL and Tablet PC for Chhattisgarh Infotech promotion society.

Under the Nation''s Digital India Programme, ITI Bangalore applied for AUA/ASA/KUA/KSA registration from EUIDAI, got pilot order
for generating secure QR code from CBSE board for class X and XII as part of SaaS, there by entering the ICT Business. Future
orders are anticipated on regular basis under SaaS, from various Educational Institutions and Aadhar related services.

ITI Bangalore has signed an MOU with TSSC (Telecom Sector skill council) and has trained 83 Candidates on the PCB Module

Implementation of Revival Projects.

Under the revival plan of BGP an amount of Rs, 138 crs was allocated (Rs, 89.5 crs for production and Rs, 48.5 crs for R&D). 6
projects were identified viz Legacy secrecy projects, 1 Gigabit encrypt or, Multichannel Encryption Unit, PSU Business, SCADA,
MUX, Telephone, Data Centre and IT Projects.

All the manufacturing areas viz. IGI, Component Test Labs, PCB Plant, SMT Line, Central Machine Shop, Coil Winding, Injection
Moulding, Inspection and Testing, Material Handling, Reliability Chambers, Air conditioning Plants, Power backups like UPS, DG
sets, Safety Equipments, Servers, Desktops, Laptops etc. were upgraded with modern equipments to take care of latest technology
in Electronics Manufacturing. Similarly, R&D upgraded the research facilities by inducting latest development tools for future

Measures taken for energy conservation

Energy Consumption for the year is 20,62,883 units compared to 21,92,638 units during the same period last year. Resulting in a
saving of 6.3 % With the upgraded infrastructure for Electronic Manufacturing in place and Rs, 6000 crs worth tenders on the
anvil, the mother plant is all set for a historic turn around.


Prestigious NFS project for package F for construction of exclusive optical NLD backbone and optical access route on turnkey
basis for Defense network allocated to ITI Mankapur is worth Rs, 844 Crs excluding AMC. Out of this, cable laying and services
work worth Rs, 260.93 Crs have been completed.

Mankapur Plant has achieved a turnover of Rs, 353.00 Crs (including ED & Service Tax) which is highest in the last ten years .The
plant supplied C-DoT equipments worth Rs, 0.21 Crs; Bank Mechanizing products approx. Rs, 1.06 Crs and LED based products worth
Rs, 0.0139 Crs.

ITI Mankapur undertakes repair of the cards for ongoing AMC work through NSU and GSM projects which contributed in revenue
generation in support of AMC activities being done by ITI NSU and GSM unit. ITI Mankapur effectively and substantially
contributed in the business through cards repairing of CSN, C-DoT, E-10B and GSM projects. During the year ITI Mankapur generated
SSU revenue worth Rs, 5.09 Crs., out of which Rs, 2.7 Crs is from SSU cards repair and Rs, 2.3 Crs is from BTS card repair.

ITI Mankapur Plant has made a new beginning in Contract Manufacturing by bagging orders from HAL and C-DOT.

An agreement for licensing of C-DOT technology for BBWT Base version has been signed between C-DOT and ITI and this product has
been allocated to Mankapur unit.

ITI Mankapur is organizing Finishing Schools for the engineering under graduates pursuing higher studies or skill development.
Under Finishing School project towards the knowledge based activities, ITI Mankapur earned revenue of approx. Rs, 0.09 Crs while
imparting training on technical innovation and skill up gradation to the engineering students from various reputed Engg. Colleges
of the country, for their better career opportunities.

Human resource Development center at Mankapur has taken initiative to be the active associate of Kaushal Vikas drive of the
Uttar Pradesh Government. They are also making efforts to be implementing agency for Pradhan Mantri Kaushal Vikas Yojna –PMKY.

MoU was signed between Our Unit and NIELIT, Gorakhpur. The MoU will pave way for regular and hands-on training of NIELIT students
right from Diploma to M.Tech level at the Unit besides innovative and developmental technical support to us.

During the Financial year 2015-16, the plant has bagged National Safety Awards for Performance Year 2013- Runner-Up for Lowest
Average Accident Frequency rate.

The efforts to monetize the buildings and houses have generated approx. Rs, 0.64 Crs. by way of rents.

Austerity measures undertaken at ITI Mankapur have resulted in reduction of expenses on different accounts especially in the area
of energy conservation. Reduction in expenditure towards electricity during 2015-16 is approx. 25.19%. in comparison with that
of 2014-15.This has been achieved by taking various measures like replacement of old mechanical energy meters by new electronic
energy meters in the residential quarters, keeping the machines and lights switched-off where ever possible, partial replacement
conventional lights by led lights etc.

Reduction in expenditure towards transport service during 2015-16 is 30.63% in comparison with that 2014-15. This is mainly due
to reduction of route buses.


Rae Bareli Plant achieved a performance of Rs, 308.49 Crore; Rs, 274.36 Crore from dispatch of NFS Cable laying, Rs, 6.66 Crores
of GPON equipment, Rs, 6.65 Crores from the supply of SMPS & Misc. equipments, Rs, 20.70 Crore worth of GSM Franchisee business
and 0.12 Crores of SMPS Repairs.

Major orders received up to 31st March 2016

ITI Limited had bagged purchase orders of Rs, 2111 Crores from BSNL, out of which Raebareli Unit has been allotted to Rs, 1267
Crores towards NFS Project (Package G). Orders worth Rs, 274 Crores executed up to 31st March, 2016. Balance Rs, 993 Crores to be
executed during 2016-17.

Future Outlook

Raebareli is taking up manufacture of C-DOT based GPON equipments, HDPE Pipe, Li-ion battery and OFC.

GPON Project

Giga-bit Passive Optical Network (GPON) is a family of products for high speed broadband communication through fiber backbone. It
caters to variety of services, like voice, video, data, internet etc. Active transmission equipment in GPON network consists
mainly of Optical Line Termination (OLT) and Optical Network Unit (ONU).

ITI Raebareli plant has experience in supplying GPON equipments to BSNL and MTNL. Currently ITI has tied-up with C-DOT for GPON
technology products. As per the ToT agreement, C-DOT''s role is limited to technology transfer for manufacturing. ITI will be
fully responsible for marketing, manufacturing, installation and maintenance support. Currently, ITI is LI against the BBNL
tender for the supply, Installation, Commissioning & Maintenance of 2000 OLTs and 50,000 ONTs for the NOFN. ITI has already
bagged an order worth Rs, 206 Crs. against this tender. ITI is also participating in BSNL tender of GPON for 1700 OLT and 42500


PLB HDPE (Permanently Lubricated High Density Poly-ethylene) Pipe is used for laying of optical fber cable (OFC) underground.

ITI Raebareli has already set up one line of PLB HDPE Pipe manufacturing with a capacity of 3600 Kms/annum. Further, it is
planned to set up additional 2 lines of PLB HDPE Pipe manufacturing, as per Report of the Committee on National Optical Fibre
Network (NOFN), Dated March 31, 2015. As per the report, HDPE Pipe still required to be laid in NOFN (Baronet) to the tune of
2,32,746.0 Km. ITI may expect 30% RQ against this requirement.

Li-ion Battery Project

Lithium is a good conductor of electricity and can combine with many other metals to form alloys. Lithium ion batteries provide
more and more energy in a smaller container. The small size, more life and fast changing Qualities of Li-ion battery makes it
more suitable for rural telecom applications. Lithium- ion batteries have many applications like cell phones, FTTX installations,
remote terminals (such as in FTTX installations), access networks, BTS (Base Transceiver Stations) for wireless networks, cable
networks, central offices, fuel cell powered system cars, artificial pacemakers, PCs, laptops, audio players, clocks, toys,
cameras, automobiles etc.

For USOF projects, Li-ion Battery is more suitable and ITI expects to grab this order. Initially Raebareli plant is taking up the
assembly of Li-ion Batteries as per TECGR specifically to meet the requirements of BTS Sites. Raebareli Plant will be responsible
for manufacturing, Marketing, installation and maintained support.

Optical Fiber Cable(OFC) Project

An optical fiber cable is a cable containing one or more optical fibers that are used to carry light. The optical fiber elements
are typically individually coated with plastic layers and contained in a protective tube suitable for the environment where the
cable will be deployed. Different types of cable are used for different applications.

Fiber optic cables find many uses in a wide variety of industries and applications. Some uses of fiber optic cables include
Medical, Defense/Government, Data Storage, Telecommunications, Networking, Industrial/Commercial, FTT-X technology.

ITI Raebareli plans to enter into OFC manufacturing area with an annual Capacity of 30,000 Kms. As per the Report of the
Committee on National Optical Fiber Network (NOFN), Dated March 31, 2015, total OFC (Ground & Aerial) required in NOFN (Bharat
Net) is 10.13 lacs Km and ITI may expect 30% RQ against this requirement.


Products Description Naini Plant 2015-16

Solar Panel Manufacturing: ITI Naini Plant is having installed capacity of manufacturing Solar modules up to 300 W for yearly
capacity of 5 MW approx. ITI Naini has acquired IEC certification for low voltage up to 50 W solar panels. For higher wattage, in
house manufactured solar module samples (up to 300 W) were submitted to M/s UL India Bangalore for testing against various
applicable clauses (IEC 61215, 61730 and 61701). Our samples passed all the tests and Naini module production facility has been
awarded IEC certification of module manufacturing of Modules from 30 W to 300 W power capacity.

The solar panel manufacturing was manual and manpower intensive facility. However due to depleting skilled manpower of ITI Naini
up gradation of facility was planned under the revival plan. During 2015- 16 ITI Naini was allocated Rs, 3 Cr as capital sanction
for solar project infrastructure up gradation against ITI revival plan (phase-I). The civil and plant works are in progress and
in advance stage of completion. The automated Tabber and Stringer Machine has been commissioned in July 2016. This will make our
manual production facility semi automatic concurrent and improve the quality of the product and also lower down the cost of
production significantly.

Under revival plan phase-II establishment of New Automatic SPV module manufacturing line of capacity 40 MW (Part-I: 18MW,
Part-II: 22 MW) process has been initiated which will make our production facility fully automatic to cater upcoming mega Power &
Communication projects substantially.

Plant has initiated rental activities for available Optical & Transmission test instruments on chargeable basis to external

ITI Naini Plant is pursuing energy saving measures. During the year sanctioned Plant load reduced from 2000 KVA to 1000 KVA
resulting in the saving of Rs, 2 Lac per month.

Training Centre: Total revenue earned during the year was Rs, 5.62 Lacs.

a. 15 days skill development training program of solar module technician conducted for 4 batches and 100 students are trained.

b. 4/6 weeks vocational summer training was conducted for 456 Degree/diploma students.

c. 18 in house training programs conducted for ITI employees.

Naini Plant is ISO 9001 and ISO 14001 certified. Surveillance audit of ISO 9001 and ISO 14001 are conducted in the year.

Under the revival plan activities, Disaster Recovery (DR) site of Data Centre will be established at ITI Naini with the main Data
Centre at Bangalore. Carrier Ethernet project will also be initiated to address business under Digital India Program through
BBNL/ BSNL for installation of Broadband access network across rural areas.


This plant has achieved a turnover of Rs, 153.39 Crs. for the year 2015-16 registering profit. This plant has completed the work
of SECC and NPR Project in allotted States and were successful in further getting additional orders for Data Digitization for Rs,
31 Crs, Data Merging and Permanent Data Centers for Rs, 23 Crs. Also efforts are on for getting for orders for Aadhar seeding
work from Kerala, Uttar hand and Uttar Pradesh to the tune of Rs, 75 Crs.

As a part of diversification of products, the plant has made inroads in the Defense Manufacturing area and Space Electronics by
supplying Cables, Bare PCBs and Assembled PCBs to NPOL, HVF Avadi, VSSC etc. This plant has setup a separate Manufacturing area
for Space Electronics fabrication to meet the requirements of stringent quality norms of Space Related products. This plant has
the only public sector shortlisted by VSSC as a partner for PSLV Launch Systems.

Also, towards the steps to regain the manufacturing mode, products were identified as HDPE Pipe, Smart Energy meter, Set top
Boxes and have identifie the Technology Partners. Also, towards smart card manufacturing efforts are on to find Technology

This plant was successful in identifying the Projects for Revival Packages under the heads of MLLN, VSSC and Smart Cards and Rs,
35 Crs were allotted against this under CAPEX. The plant has installed machineries for the above worth Rs, 33 Crs. against
various project.

AMC Department was successful in renewing the contract worth Rs, 62.22 Crs with BSNL and MTNL for MLLN Equipments for further 3.5
years and 4 years respectively. The plant is also successful in getting orders worth Rs, 12.63 Crs for MLLN Modems, Rs, 5.44 Crs
for Data Base License for SSTP, Rs, 6.20 Crs for NMS Sever up gradation from BSNL / MTNL during 2015-16.

Towards Energy saving front, the plant has started replacing Mercury Vapour Lightings by LED Lighting and are switching off all
our lightings for half an hour daily. Also we are keeping the 1.6 MVA Transformers shut down for approximately 9 months. Annual
energy saving is expected is approximately 3000 KW per month by these steps. Also on experimental baisis we have implemented drip
irrigation for garden by saving approximately 3000 liters of water daily.

Kerala Government has selected Palakkad plant as one of their Training Service Provider of ASAP Scheme (Additional Skill
Acquisition Programme) and last year we have conducted training for two Batches of 20 Students each for PCB Course and One batch
of 20 students for FTCP.( Field Technician and Computing Peripherals).

The plant has successfully completed the surveillance audit for Quality Management System and Environment Management System and
is working towards certification of QMS and EMS with 2016 standards. In the Industrial Safety front the plant is the runner up
for the Outstanding Safety performance in the large size Engineering Industries Group from National Safety Council Kerala


Srinagar Plant achieved a turnover of Rs, 3.06 lakhs for the year 2015-16.


Continuing its consistently good performance, this Unit achieved a turnover of Rs, 135.41 Cr. and registered a profit of Rs,
28.77 Cr. Revenue from AMC for ASCON remained the major contributor at Rs, 104.59 Cr. while OCB 283 AMC for BSNL and MTNL
contributed Rs, 21.99 Cr. and Rs, 8.82 Cr. respectively.

Fresh Composite Annual Maintenance Contract for ASCON was signed between NSU and Ministry of Defense on 31.07.2015. This AMC is
valid with retrospective effect from 01.12.2014 and expires on 30.11.2019. Under this AMC, average annual fixed charge is valued
at Rs, 56 Cr. and variable charges at Rs, 32.63 Cr. AMC for 12 1 Up gradation Project, also under MoD, was signed on 30.07.2015
and is valid up to 24.02.2020. Average annual value of the contract is Rs, 11.30 Cr.

For the current fiscal, OCB 283 AMC for BSNL and MTNL have been renewed and are valued at Rs, 26.16 Cr. and Rs, 11.41 Cr.



- Sundry Debtor realization during 2015-16 is Rs, 90.11 Crs.

- Order bagged in 2015-16 is Rs, 75.35 Crs ,

- Rs, 82.51 Crs orders on hand as on 01.04.2016.

- Cost cutting measures undertaken by ROs resulted in a saving of Rs, 1.65 Crs.

New Projects taken up in 2015-16 :

- Integrated University Management System (IUMS) for Universities of total approx value Rs, 13 Crs - RO Delhi

- CCTV surveillance for FCI of approx valueRs,2 Crs. - RO Delhi

- IT Services for online examination activities for TNPSC & SSB for 3 years, estimated business is Rs, 8 Crs - RO Chennai

- SITC of HPC cluster with storage etc for NMAIST, ARUSHA, Tanzania against CDAC order. - RO LKO Big orders successfully
completed in 2015-16

- e Tendering business of value Rs, 41.02 Crs - RO Delhi, Bangalore, Kolkata & Luck now

- RO Bhubaneswar has successfully completed Odisha Wide Area Network (OSWAN) project. This was on BOOT model spanning for 5
years and the total project value was approx. Rs, 69 Crs.

- RO Delhi has completed two Integrated University Management Systems (IUMS) orders of value Rs, 5.11 Crs.

Future Prospects:

RO Hyderabad shortly taking up implementation of Network Management System (NMS) for

BSNL and is expected to bill approx. Rs, 32 crore in FY 2016-17

Uttarakhand Govt. has shortlisted ITI Limited, RO Luck now for implementation of work related to IT.

RO Luck now presently working on the order, received for implementation of W Fi Zone at important tourist spots in the state of

RO Luck now shall be establishing Audio Video Infra for Luck now Development Authority (LDA).


The company''s rating for the year 2014-15 is Very Good with a composite score of 2.41 This composite score is BEST during
thirteen years, i.e 2002-03 to 2014-15. The company has signed Memorandum of Understanding with the Administrative Ministry for
sales turnover of Rs, 1800 Crores for the year 2015-16.


The following projects are planned for implementation under revival plan.

- HDPE pipe and Optical Fiber cable manufacturing:

Laying of optical fiber cable (OFC) underground is to be carried out through PLB HDPE (Permanently lubricated high density Poly
ethylene) Pipe only. The demand for HDPE Pipes has quickly risen due to several Government projects like, NFS, ASCON, NOFN etc.
As per Govt. of India initiative for DIGITAL INDIA programme, optical fiber network is to be established in the whole country
for easy inter-net accessibility. Therefore, there is huge demand of PLB HDPE pipes. Apart from BSNL and BBNL, other service
providers are also requiring such type of PLB HDPE pipes for their telecom service. ITI Raebareli plant has established one
number of HDPE manufacturing line. The plant is now ready for bulk production. Considering the huge market available for this
product in projects like NFS and NOFN, ITI is planning to establish more lines of manufacturing in Raebareli plant and similar
facility in Palakkad plant also.

Similar to HDPE pipes, there is huge demand for optical fiber cables also. Company has proposed to manufacture these cables in
Raebareli and Palakkad Plants.

- Encryption Products for Defense:

The encryption products for Defense communication networks are being supplied by ITI for long time. ITI has been the leader in
this field. The products are evolved in tune with the evolution in the digital communication technology. There are major
requirements of encryption products for Defense for their NFS network, ASCON network etc.

- G-PON manufacturing:

In the recent tender foated by BBNL for G-PON equipments, ITI has been emerged as L1 bidder with C-DOT technology. ITI is gearing
to start manufacturing of this product at Raebareli plant from component level with C-DOT as the technology provider.

- Manufacture of Smart Cards:

As an extension of National Population Register project, which is under execution by ITI as a consortium partner with BEL and
ECIL, ITI is looking at the huge opportunity of manufacturing Smart card based identity cards for the citizens in the Country. In
addition, there are opportunities regarding supply of smart cards for unorganized workers, driving licenses, motor vehicle
registration etc. ITI is already having smart card manufacturing facility at its Palakkad plant. This is being further augmented
to take manufacture of various types of identity cards.

- Manufacturing of Li-Ion Batteries:

High density back up power solutions using Li- Ion technology have been proved in all fields of consumer electronics like PCs,
Mobile phones, Tablet PCs etc,. They are also making inroads into other applications like powering GSM towers. ITI is planning to
take up assembling of Li-Ion batteries in one of its plants, specifically for supplying to the BTS sites.

- Component Screening Project:

Component Screening is a Project suggested by VSSC for ITI Palakkad to take up for meeting their requirement of approximately 5
Lakh screened components per year. Screened Components are required regularly for VSSC for their space missions. Basic component
screening facility has already been established in the plant. Currently, based on the indications from VSSC, the company proposes
to augment the component screening infrastructure to test integrated devices.

- Data Center and IT Business:

Company has planned investment to address the huge growth in the service sector related to Information Technology. Currently ITI
has been operating one Data Center in its Bangalore plant in partnership with a private company. However, the company plans to
build its own Data Center under the revival plan. In addition, company has planned to launch some IT solutions, like E-Banking,
Aadhaar based authentication etc. on SaaS basis from the Data Center.

ITI is also planning to address the opportunities arising out of the Digital India and Smart Cities projects where in several
products in the latest IT technology, like, sensors.

- Wi-Fi products:

Wi-Fi products have revolutionized the way we communicate. In addition to low power Wi-Fi products in residences, Wi-Fi hot
spots are coming up all around the country. Further, Wi-Fi products are also expected to be part of the Digital India programme
to connect every citizen to Broadband network and also in setting up of Smart Cities. ITI is planning to address this business
opportunity in association with a technology partner.

- Managed Leased Line Network (MLLN) Equipments:

ITI has been the leader in supplying MLLN equipments for BSNL and MTNL. The existing MLLN networks of these PSUs have been set
up by ITI and ITI hopes to address their future requirements. In addition, ITI is getting good revenue for giving maintenance
support to the existing networks.

- Low Power BTS systems for remote villages:

Low power BTS systems have been planned as a means to extend mobile connectivity to cover all the unconnected villages in the
country. USOF has planned to fund such programmes so that every village in the country is connected through mobile communication
networks. ITI is hoping to get orders for supply of equipments required for such networks.

- Business with PSUs/ Contract Manufacturing:

Contract manufacturing for PSUs is an existing activity in ITI. ITI is already executing job works for PSUs like, BHEL, BEL,
VSSC, NPOL etc. With up gradation of infrastructure in ITI, there is more scope for getting new business in the area of contract


During the year, your company has contributed Rs, 9640.22 lakhs to the exchequer towards duties and taxes.


Value of deposits held by the company is NIL. Deposits aggregating to Rs, 0.24 Crore had matured for payment, but were not
claimed on due dates.


The comments on the accounts for the year 2015-16 by the Comptroller and Auditor General of India is appended.



ISL was incorporated in the year 1987 and the present shareholding of ITI in ISL is 49% with M/s. Chris Tech Systems Pvt Limited
holding 51% shares. The Board of ISL planned to revive the operations of the company through a JV proposal with National
Building Construction Corporation Ltd, a Govt. of India Enterprises. In this regard, Board of ISL is awaiting Ministry''s
direction and final disposal of the case initiated by Karnataka Industrial Area Development Board (KIADB) which is pending before
Hon''ble High Court of Karnataka.

The salient features of the Joint Venture Companies are furnished in form AOC -1 which is appended to this report.


Quality policy of ITI is to deliver high quality, secure and reliable products, services and solutions by empowering every
employee. Quality Assurance wings are functioning in all the manufacturing units of ITI Ltd. The QA wings are responsible for
delivery of Quality products and services. The Units have been well equipped with necessary test facilities and test systems for
carrying out elaborate tests, conducting reliability evaluations on all the products to ensure quality. This is achieved by sound
and effective Quality Management System.

The five manufacturing plants at Bengaluru, Palakkad, Mankapur, Rae -Bareli and Naini have been accredited with ISO 9001-2008,
NSU Bangalore is also accredited With ISO 9001-2008. The periodical Surveillance Audit & Recertification Audits have been
conducted successfully, Keeping in tune with the Global concern for Environmental Management all the plants have also gone in for
ISO 14001-2004 EMS certifications. The guidance and support to all the units for training implementation surveillance audits &
recertification audits of ISO 9001-2008 and EMS 14001-2004 are provided by Corporate Quality Assurance .


Employee strength at the end of the year 31st March, 2016 was 5229 out which 503 were female employees.

As on 31.03.2016, there were 861 employees belonging to Scheduled Castes and 50 belonging to Scheduled Tribes.

29 Officers on Tenure basis 27 contract Engineers & 25 Contract Technicians were recruited during the year 2015-2016.

Employees belonging to Physically Challenged Persons numbering 74 and Ex-servicemen category numbering 21 were on the rolls of
the company as at the end of the financial year.


The Industrial Relations scenario in the Company was cordial during the year. Employees'' Union and Officers'' Association extended
their co-operation and support in ensuring smooth work fow and helped to meet the Company''s objective.


As per the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 (''Act'') and
Rules made there under, Company has constituted Internal Complaints Committees (ICC) to redress complaints received regarding
Sexual Harassment at our all Units. All employees (permanent, Contractual, Temporary, trainees) are covered under this policy

No. of complaints received during the year 2015- 2016 is NIL.


The Indian Telecommunication is zooming up the growth curve with feverish pace. With the rapid development in telecom, India is
one of the most rapidly growing telecom markets in the world. India is also a market where new technologies are slated to be used
aggressively. In the present scenario of fast changing technology and increasing competition, IT imparts training as to enable
its employees to remain updated of knowledge and skills to offer surpassing technological obsolesce and competitive edge in their

Keeping in view the Company MoU target on HRM – Training for the FY 2015-16, the HRD initiatives were more oriented towards
imparting Training to Executives / Non-Executives for knowledge / skill development in Telecom and IT. Training Programmes and
Workshops were organized in Broadband, OFC, Mobile, NGN, Cyber Security and Communication Technologies. Towards digitalization
and to improve computer literacy in the company both basic and advance course in computer skills, training programmes in
Microsoft Office were imparted throughout the Company. Training programmes were also organized in-house on Soft Skills, Stress
Management, Safety, besides organizing awareness programmes on Health, Environment, Energy Management;

ITI takes up Govt. of India initiatives like Digital India and Skill India to fully comply with the directives of the Govt of
India and in HRD sphere, skill development training sessions are being organized particularly for the students across India
utilizing the infrastructure facilities in the HRD Centers of our Units. These short-courses are devised to enable them to take
up employment immediately/ enhance the employability, in association with Governmental authorities and Skill Sector Councils and
other Training Partners in all ITI Units over and above internal enrichment of course contents. During the financial year ITI
imparted telecom skill development training to 2104 trainees, out of which 310 in TSSC/ ESSCI Qualifications packs and 1794 have
been trained in ITI modules.

ITI always achieves its targets and in fact overwhelmingly surpasses given targets of MOU with DOT. Additionally, the skill gaps
arising out of newer technologies and changed product portfolio among the employees are also continuously monitored and
effectively plugged in periodically.

In a nutshell, as against the MoU target in respect of HRM performance indicators, 124 training programmes have been organized In
house/ sponsored outside. The company trained 1699 Executives and 813 Non-Executives achieving 5834 and 1838 training man-days

2104 students have been trained in telecom skill development training and achieved ''Excellent'' MoU ratings in all the HRM
training parameters for the year 2015-16.


All Units / Offices have established Check-points in their departments to make effective implementation of the Official
Language Policy. Monitoring is being done by the respective Official Language Implementation Committees constituted in every Unit
/ Office.

The Progress of Implementation of Official Language in our Corporate Office as well as in our all subordinate Units / Offices is
also being periodically reviewed by the OLIC Committee of Corporate office.

In order to enhance the working knowledge of Official Language of our employees, they have been sent to various Training Programs
organized by the government for imparting training in Hindi awareness, Hindi typing and Hindi Stenography as per our requirement.
However, the Official Language Cells of the different Units / Offices have also conducted internal training programs. Besides,
employees were encouraged to take part in Hindi Prabodh, Praveen & Pragya examinations for which financial incentives have also
been sanctioned.

Our Units / Offices at Naini, Rae Bareli, Mankapur, New Delhi, Mumbai, Luck now & Corporate Office have been notified in the
Gazette of India as per OL Rules 10 (2) & (4), 1976 after more than eighty percent (80%) of the staff working have acquired a
working knowledge of Hindi in these Units/ Offices.

After reviewing our quarterly reports, regular appreciation letters have been received from Dy. Director-OL, Official Language
Department DoT, New Delhi as well as Dy. Director (Implementation), Regional Implementation Office, Bangalore.

A Joint Hindi Fortnight Program for Bangalore based PSUs / Organizations was organized by TOLIC (Town Official Language
Implementation Committee) Bangalore between 13.07.2015 & 14.08.2015. Various types of competitions were arranged during this
period. On this occasion many officers/Non- officers of ITI Limited, Bangalore based Units / Offices also participated in these
competitions and more than 05 Officers / Non-Officers have got the prizes. Valedictory function was held on 28.10.2015 and cash
prizes and certificates to the wining participants were given by President, TOLIC.

Hindi Fortnight was celebrated and various Hindi Workshops were organized for encouraging progressive use of Hindi during
2015-16. Bilingual (i.e. English and Hindi) website of company is being regularly updated.


During the year, Vigilance Department focused on the preventive vigilance activities in order to bring more transparency and
efficiency in the organization. CVC guidelines and Government policies in this regard have been strictly followed.

To achieve the above objectives, periodical inputs were intimated to the Management regarding publishing of NITs, ''Contracts
concluded'' in the company website, implementation of Rotational Transfers of Executives in Sensitive Areas, implementation of
Integrity Pact and periodical review for ensuring probity & effcacy among employees. Several System Improvement Measures have
also been suggested to various departments as a part of preventive vigilance.

The Company celebrated Vigilance Awareness Week from 26th October, 2015 to 31st October, 2015 in all manufacturing units,
business establishments and corporate Office.

The Vigilance department is endeavoring to lay far more emphasis on preventive vigilance, scrutinizing the documents, conducting
CTE type examination and surprise checks in sensitive departments. These actions had good impact for creating awareness amongst
Company Executives on Vigilance aspects of Company Governance.


During the year 2015-16, out of 336 RTI requests, information was provided against 290 requests, 28 requests rejected and 5
requests were transferred to another Public Authority. The RTI returns on quarterly basis is being submitted to the Ministry for
forwarding the same to Central information Commission and the same is published on our Company website.

With a view to achieve total transparency, the requests and responses are being uploaded on our website by FAA/CPIO/Public
Information Officers of Units under the specific link given to each unit. All cases referred to CIC as second appeal have been
successfully addressed.



M/s. Sundar Srini & Sridhar, Chartered Accountants, Bangalore, were appointed by Comptroller & Auditor General of India as
Statutory Auditors for the year 2015-16. The Statutory Audit Report for the year 2015-16 and reply to the observations of the
Statutory Auditor are appended as an Annexure to this Report


The following firms of chartered Accountants were appointed as Branch Auditors for different plants of the Company for the year

Unit Name of Auditor

1. Bangalore Sundar Srini & Sridhar, Bangalore

2. Naini Neeraj Prakash & Associates, Allahabad

3. Rae Bareli Rajesh Srivastava & Associates, Luck now

4. Mankapur Sri Prakash & Co. Gorakhpur

5. Palakkad Mahadevan & Sivarajan, Palakkad

6. Srinagar M/s. S D M & Co, Srinagar


M/s GNV Associates, Cost Accountants, Bengaluru was appointed as Cost Auditors for the year 2015-16 for the cost audit of south-
based units located at Bangalore, Palakkad and also consolidation for the Company and M/s. Aman Malviya & Associates, Luck now
as Branch auditors for the Cost Audit of North based units located at Naini, Rae Bareli, Mankapur and Srinagar.


The Company has appointed Shri D Venkateswarlu, Company Secretary in practice, to undertake the Secretarial Audit of the Company.
The Secretarial Audit Report for the year 2015-16 and reply to the observations of the Secretarial Auditor are appended as an
Annexure to this Report


The Company has constituted Corporate Social Responsibility Committee and the details of same are furnished in Corporate
Governance report. For the year under review, the Company was not required to spend on CSR activities. However the Company has
set up Hospitals, Schools and Playgrounds at various Manufacturing Units for the benefit of employees and the local community.


The President of India is empowered to appoint the Directors of the Company from time to time and also to determine the terms of
office of such Directors in terms of the Articles of Association of the Company. Accordingly, the following changes on the Board
of your Company were effected during the year as per the directives of the President of India.

Independent Director

Shri Dhirendra Singh and Dr M J Zarabi relinquished the position as Directors w.e.f 02.10.2015 on completion of three year
tenure. Prof Ramesh Bhat also relinquished the position as Director w.e.f 02.01.2016 on completion of three year tenure.

Shri Shri Saday Krishna Kanoria was appointed as an Independent Director w.e.f 24.11.2015. The terms and conditions of the
Independent Directors are posted on the web-site of the Company.

Independent Directors shall not be liable to retire by rotation. The Independent Directors of your Company have given the
certificate of independence to your Company stating that they meet the criteria of independence as mentioned under Section 149
(6) of the Companies Act, 2013.

Government Nominee Directors

Dr Janaki Ananthakrishnan was appointed as Government Director in the place of Shri R K Mishra w.e.f. 13.05.2015.

Shri Srikanta Panda, DDG (LF-I) was appointed as Government Director w.e.f. 29.07.2015 in the place of Dr Janaki Ananthakrishnan
who has since been appointed as Director Finance.

Shri R M Agarwal, DDG(SU) was appointed as Government Director in the place of Shri Srikanta Panda, w.e.f 08.06.2016

Changes in Functional Directors

Shri K K Gupta, then Director Production was granted additional charge as Chairman and Managing Director in the place of Shri K L
Dhingra w.e.f 04.06.2015. Shri K K Gupta relinquished the position as a Director on 31.10.2015 on attaining the age of

Dr Janaki Ananthakrishnan was appointed as Director Finance, vide Ministry of Communications & IT order No. F.No.14-3/2013-PSA
(Pt-1) dated 10th June 2015, as per directives of President of India. Dr Janaki Ananthakrishnan took charge as Director Finance
on 13.07.2015.

Shri S.Gopu, Director-HR was granted additional charge as Director-Production for a period of 3 months from 01.11.2015. He held
the position as Director-Production till 28.01.2016.

Shri P K Gupta, Director Marketing was granted additional charge of Chairman and Managing Director w.e.f. 01.11.2015

Shri K Alagesan was appointed as Director Production vide Ministry of Communications & IT order No. F.No.14-5/2014-PSA dated
28.01.2016, as per directives of President of India. Shri K Alagesan took charge as Director Production w.e.f 29.01.2016

Shri S.V.R.Murthy, AGM-CF, was appointed as Chief Financial Officer with effect from 29.05.2015 subsequently Dr Janaki
Anathakrishnan was appointed as Chief Financial Officer w.e.f 11.08.2015. Chief Financial Officer and Company Secretary
continues to be Key Managerial Personnel along with the Functional Directors of the Company.

The Board placed on record its deep appreciation of the valuable services rendered by the Directors whose term of office ended
during the year.

In accordance with the provisions of the Companies Act, 2013. Shri S.Gopu and Dr Janaki Ananthakrishnan retire by rotation and
are eligible for re-appointment.

The policy on Director''s appointment and remuneration and also remuneration for Key Managerial Personnel forms part of Corporate
Governance Report of this Annual Report.


During the year, 6 meetings of the Board were held on 29.05.2015, 11.08.2015, 23.09.2015, 09.11.2015, 19.12.2015 and 10.02.2016.


There were no employees of the Company who received remuneration in excess of the limits prescribed under Companies Act, 2013
read with Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2015.


A report on Corporate Governance and Management Discussion and Analysis Report along with a Compliance Certificate from Statutory
Auditors as required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is appended to this


The extract of annual return in Form MGT 9 as required under Section 92(3) and Rule 12 of the Companies (Management and
Administration) Rules, 2014 is appended as an Annexure to this Report.


In line with the requirements of the Companies Act, 2013 and Equity Listing Agreement, your Company has formulated a Policy on
Related Party Transactions which is also available on Company''s website at _ information.
The Policy intends to ensure that proper reporting; approval and disclosure processes are in place for all transactions between
the Company and Related Parties.

All Related Party Transactions entered during the year were in Ordinary Course of the Business and on Arm''s Length basis. No
Material Related Party Transactions, i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last
audited financial statements, were entered during the year by your Company. Accordingly, the disclosure of Related Party
Transactions as required under Section 134(3) (h) of the Companies Act, 2013 in Form AOC 2 is not applicable.


The Directors confirm that

(a) In the preparation of the annual accounts for the year ended 31st March 2016, the applicable accounting standards had been
followed along with proper explanation relating to material departures;

(b) That such accounting policies have been selected and applied consistently and judgments and estimates have been made that are
reasonable and prudent so as to give a true and fair view of the state of affairs of the company at 31st March 2016 and of the
profit of the company at that date;

(c) That proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of
Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) That the annual financial statements have been prepared on a going concern basis; and

(e) That proper internal financial controls were in place and that the financial controls were adequate and were operating

(f) That systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were
adequate and operating effectively.


Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in
the notes to the Financial Statements.


The expenditure on entertainment was Rs, -3.93 lakhs. Expenditure on Official travel abroad by the Officials of the Company
amounted to Rs. NIL during the year.



Particulars with respect to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo, required to be
disclosed under the Section 134 of the Companies Act 2013 read with Rule 8 of Companies (Accounts) Rules, 2014 are annexed.


The Board of Directors place on record their sincere thanks for the assistance and continued support extended by the Ministry of
Communications & IT and various other Ministries of Central and State Governments where we have operations and look forward for
their continued support and co-operation in future. The support and cooperation by the Comptroller and Auditor General of India,
the Statutory Auditors, Branch Auditors, Cost Auditors and Secretarial Auditor needs special mention and directors acknowledge
the same. Your Directors take this opportunity to place on record their appreciation for the dedicated effort put forth by the
employees at all level. The gradual turnaround of the Company is made possible by their hardwork, solidarity, Cooperation and

For and on behalf of the

Board of Directors

(P. K. Gupta)

Director Marketing

Addl Charge Chairman and Managing Director

Place: Bangalore

Date : 11th August 2016

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