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BAG Films and Media Ltd.

BSE: 532507 | NSE: BAGFILMS | Series: NA | ISIN: INE116D01028 | SECTOR: Media & Entertainment

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Annual Report

For Year :
2018 2015 2014 2013 2012 2011 2010 2009 2008

Director’s Report

BOARD''S REPORT

To,

The Members,

B.A.G. Films and Media Limited

The Directors have pleasure in presenting their 25th Annual Report on business and operations of the Company along with the Audited Financial Statements for the financial year ended March 31, 2018. The consolidated performance of the Company and its subsidiaries has been referred to wherever required.

FINANCIAL RESULTS

The standalone and consolidated performance of the Company and its subsidiaries, for the year under review along with previous year figures are given hereunder:

(Rupees in Lacs)

Particulars

Standalone

Consolidated

2017-18

2016-17

2017-18

2016-17

Total Income

2,505.99

2,474.70

13,316.14

1,3761.25

Profit before Depreciation & Financial Charges

1,529.65

1,556.68

2,787.26

3,286.65

Financial Charges

757.58

1,068.91

1,384.67

1,634.95

Cash Profit

772.07

487.77

1,402.59

1,651.70

Depreciation

1,227.63

785.71

1,697.46

1,299.15

Profit before Tax

(455.56)

(297.94)

(294.87)

352.55

Provision for Tax

(167.17)

(35.71)

(147.42)

(6.42)

Profit after Tax

(288.39)

(262.23)

(147.45)

358.97

Proposed Dividend

Nil

Nil

Nil

Nil

COMPANY PERFORMANCE/ STATE OF COMPANY''S AFFAIRS

During the year under review, the Standalone total income from operation of the company is Rs. 2,505.99 lacs against Rs. 2474.70 lacs during the previous financial year. As per the Consolidated Accounts, the total income decreased from Rs. 13,761.25 lacs to Rs. 13,316.14 lacs during the year. As a strategy, we focused on cost optimizing thereby improving bottom-line. There was standalone Cash profit of Rs. 772.07 lacs as against Rs. 487.77 lacs in previous year.

On Standalone basis, loss after tax for the year slightly increased to Rs. 288.39 lacs against Rs. 262.23 lacs in Financial Year 2016-17.

BAG

BAG holds the unique distinction of producing programmes of all genres for a range of channels and audience. We maintain a strong leadership spot in the TV business with our unmatched creative production capacity to develop shows catering to a diverse set of audience. We have constantly built relationships across the news and entertainment industry which allows us to identify new avenues and markets. We will continue to focus on creating more high impact content for the daily shows as they are more economical and profitable. We are consistently building capacity and capabilities to provide relevant content on a regular basis in the digital space.

We will also create more content for news and entertainment channels. We are also planning to produce content for digital platform such as Netflix and Hotstar.

Broadcasting

News24, a 24 hours National Hindi free to air Hindi news channel operating through its subsidiary, i.e. News24 Broadcast India Limited, has consistently maintained healthy market share in Hindi News Genre and is available throughout India on cable and DTH platforms. In the age of social media, News 24 has been able to maintain its credibility.

News24, Hindi news channel is also available throughout West Asia and the MENA Region on DU network.

E24, a 24 hours Bollywood Entertainment channel operating through its subsidiary E24 Glamour Limited, pitched as Bollywood''s channel managed to attract audience of all age groups and succeeded in creating a new genre in television entertainment.

E24, now available throughout west Asia and the MENA region on DU network has gained popularity in international market too.

Dhamaal24

FM radio station, on frequency 106.4 in the name of Dhamaal24

- Har Khushi hai Jahan operating through its subsidiary Skyline Radio Network Limited is now the voice of the regions and many of its shows are household names in all ten cities where it is operational i.e.Hissar, Karnal, Patiala, Ranchi, Muzaffarpur, Dhule, Jalgaon, Ahemednagar, Simla and Jabalpur.

Darshan24: Darshan24 is the new age devotional channel which has been designed for all age groups. The Channel endeavors to bring the masses close to roots of our Indian culture and its

Appointments/ Resignations of the Key Managerial Personnel

Ms. Anurradha Prasad, Chairperson cum Managing Director, Mr. Ajay Jain, Chief Financial Officer and Mr. Rajeev Parashar, Secretary of the Company are the Key Managerial Personnel as per the provisions of the Act. During the year under review, there was no change in the Key Managerial Personnel of the Company.

Directors retiring by rotation

Pursuant to provision of section 152 of the Act read with the Articles of Association of the Company, Ms. Anurradha Prasad will retire by rotation at the ensuing 25th Annual General Meeting and is eligible for re-appointment.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and SEBI Listing Regulations, the Board has carried out the annual performance evaluation of its own performance, of the Directors individually, as well as the evaluation of the working of its Audit, Nomination & Remuneration and other Committees of the Board. At the meeting of the Board, all the relevant factors that are material for evaluating the performance of individual Directors, the Board and its various Committees, were discussed in detail.

Schedule IV of Companies Act, 2013 read with corporate governance requirements as prescribed by under the SEBI Listing Regulations mandate that annual performance evaluation of Independent Directors should be carried out by other directors to the exclusion of Directors being evaluated.

The evaluation of all the Directors and the Board as a whole was conducted based on the criteria and framework adopted by the Board. The evaluation process has been explained in the Corporate Governance Report section in the Annual Report. The Board approved the evaluation process results of the Company.

Meetings

The Board of Directors of your Company met 7 (seven) times during the year under review. The details of Board meetings and the attendance of the Directors are provided in the Corporate Governance Report, which forms part of this report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

Composition of Committees of the Board of Directors

The Board Committees play a crucial role in the governance structure of the Company and have been constituted to deal with specific areas/activities which concern the Company and need a closer review. The Board Committees are set up under the formal approval of the Board to carry out clearly defined roles which are considered to be performed by members of the Board. The terms of reference of Board Committees are determined by the Board from time to time.

The Company''s Board has the following Committees:

1. Audit Committee

2. Stakeholders Relationship Committee

3. Risk Management Committee

4. ESOP Compensation Committee

diverse religion in order to teach and preach the new generation our long age tradition and customs.

CHANGE IN THE NATURE OF BUSINESS, IF ANY

There was no change in the nature of business of the Company during the financial year ended March 31, 2018.

DIVIDEND

The Directors express their inability to declare any dividend for the financial year ended March 31, 2018 on account of losses incurred during the year under review. The Company has not made any transfer to General Reserve.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND

In terms of Section 125 of the Companies Act, 2013 (herein after referred as the Act), relevant amounts which remained unpaid or unclaimed for a period of seven years have been transferred by the Company to the Investor Education and Protection Fund (IEPF) established by the Central Government. During the year under review, the Company has no any unclaimed and unpaid dividend amount for a period of seven year or more.

DIRECTORS

There are 5 (five) Directors on the Board of your Company, comprising of 3 Independent Directors, a Non-Executive Director and a Chairperson cum Managing Director (CMD).

The Board of the Company besides Ms. Anurradha Prasad, as the Chairperson cum Managing Director has 2(two) women Independent Directors, viz. Dr. Anuradha Mishra and Ms. Urmila Gupta.

Independent Directors

Definition of Independence of Directors is derived from Regulation 16 of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 (herein after referred as the SEBI Listing Regulations) and Section 149(6) of the Act. The Company has received necessary declaration from Independent Directors stating that they meet the prescribed criteria of independence.

Based on the confirmation/ disclosures received from the Directors under section 149 (7) of the Act, the following Non Executive are considered as Independent Directors:

1. Dr. Anuradha Mishra

2. Ms. Urmila Gupta

3. Mr. Pankaj Chaturvedi

In a separate meeting of independent directors, performance of non-independent directors, performance of the board as a whole and performance of the chairperson was evaluated, taking into account the views of executive directors and non-executive directors. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.

Appointments/ Resignations from the Board of Directors

During the financial year under review, there was no change in the Board of Directors of the Company.

EXTRACT OF ANNUAL RETURN

Pursuant to section 92(3) and section 134(3)(a) of the Act extract of the Annual Return as on March 31, 2018 in Form No. MGT-9 is enclosed as Annexure I to this report.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

Your Company is not engaged in any manufacturing or processing activity, as such particulars required to be given in terms of Section 134 (3) (m) of the Act read along with Companies (Accounts) Rules, 2014, regarding conservation of energy and technology absorption are not applicable.

FOREIGN EXCHANGE EARNING AND OUTGO

During the financial year 2017-18, your Company''s foreign exchange earning was nil and foreign exchange outgoings were Rs. 2,871,955.

SIGNIFICANT AND MATERIAL ORDERS

During the year under review, there were no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and Company''s
operations in future.

INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY

The Company had internal financial control systems, commensurate with the size and complexity of its operations, to ensure proper recording of financial and monitoring of operational effectiveness and compliance of various regulatory and statutory requirements. The internal auditor monitors and evaluates the efficacy and adequacy of internal control systems in the Company. Based on the report of the internal auditor, respective departments undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Act are given in the notes to the Financial Statements which form part of this Annual Report.

RISK MANAGEMENT POLICY

In accordance with the requirements of the Companies Act, 2013 the Company has adopted Risk Management Policy, approved by Board and established a risk management framework to identify, mitigate and control the risk and threat.

An abridged policy on risk management has been placed on the company''s website www.bagfilms.com.

The details of Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board''s Report.

PUBLIC DEPOSITS

During the year under review, your Company has not accepted any deposits under section 73 to 76 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014.

5. Nomination and Remuneration Committee

6. Securities Committee

The details of scope terms of reference, membership, composition and attendance at meetings are provided in Corporate Governance Report of this Annual Report.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors to the best of their knowledge and ability confirm that:-

a) in the preparation of the annual accounts for the year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year March 31, 2018 and of the loss of the Company for the year ended on that date;

c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) they have prepared the annual accounts of the Company on a ''going concern'' basis.

e) the internal financial controls to be followed by the Company were laid down and such internal financial controls are adequate and operating effectively.

f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

SUBSIDIARY COMPANIES

The Company has four subsidiaries as on March 31, 2018 out of which one is Wholly Owned Foreign Subsidiary. There is no associate company within the meaning of Section 2(6) of the Companies Act, 2013.

Consolidated Financial Statements

The audited consolidated financial statements together with Auditors Report form part of the annual report. The details of basis of preparation and consideration, principle of consolidation are disclosed in Notes of Consolidated Financial Statement. Pursuant to provisions of section 129(3) of the Act, a statement containing salient features of the financial statements of the Company''s subsidiaries in Form AOC-1 is attached to the financial statements of the Company.

Further, pursuant to the provisions of section 136 of the Act, the financial statements of the Company including the consolidated financial statements along with relevant documents and separate audited financial accounts in respect of subsidiaries, are available on the company''s website www.bagfilms.com.

AUDITORS AND AUDITORS'' REPORT Statutory Auditors

M/s. Kumar Khare & Co., Chartered Accountants (ICAI Firm Registration No 006740C), Chartered Accountants, were appointed as Statutory Auditors of the Company at the 24th Annual General Meeting held on September 26, 2017 for a term of five consecutive years. As per the provisions of Section 139 of the Companies Act, 2013, the appointment of Auditors is required to be ratified by Members at every Annual General Meeting.

In accordance with the Companies Amendment Act, 2017, enforced on 7th May, 2018 by the Ministry of Corporate Affairs, the appointment of Statutory Auditors is not required to be ratified at every Annual General Meeting.

Qualification in Auditors reports

There are no qualifications, reservations or adverse remarks made by M/s. Kumar Khare & Co., Chartered Accountants, Statutory Auditors, in their report for the financial year ended March 31, 2018.

Pursuant to provisions of section 143(12) of the Companies Act,

2013, the Statutory Auditors have not reported any incident of fraud to the Audit Committee during the year under review.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Balika Sharma & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year ended March 31, 2018.

There are no qualifications, reservations or adverse remarks made by the Secretarial Auditor in her report. The Report of the Secretarial Audit in Form No MR-3 for the financial year ended March 31, 2018 is enclosed as Annexure IV to the Board''s Report.

LISTING

The equity shares of the Company are listed with National Stock Exchange of India Limited (NSE) and BSE Limited (BSE). There are no arrears on account of payment of listing fee to the Stock Exchanges.

CORPORATE GOVERNANCE

The Company is committed to maintain the highest standards of Corporate Governance and adhere to the Corporate Governance requirements.

As per Regulation 34 of the SEBI Listing Regulations, a separate section on corporate governance practices followed by your Company, together with a certificate from M/s. Kumar Khare & Co., Statutory Auditors, on compliance with corporate governance norms under the SEBI Listing Regulations, is annexed and forms part of this Report.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

In terms of Regulation 34 of the SEBI Listing Regulations, the Management Discussion and Analysis report on your Company''s performance, industry trends and other material changes

CORPORATE SOCIAL RESPONSIBILITY POLICY

The Company believes in voluntary commitment to Corporate Social Responsibility initiatives though mandatory contribution is not yet applicable to the company. The Company shall report the same and shall submit the relevant report as and when they become applicable.

NOMINATION AND REMUNERATION POLICY

The Board has on the recommendation of the Nomination & Remuneration Committee framed a policy for selection & appointment of Directors, Senior Management and their remuneration in compliance with provisions of section 178 of the Companies Act, 2013 and Regulation 19 of the SEBI Listing Regulations as amended from time to time.

The Remuneration policy of the Company is a comprehensive policy which is competitive, in consonance with the industry practices. The policy ensures equality, fairness and consistency in rewarding the employees on the basis of performance against set objectives.

The Company''s Policy relating to appointment of Directors, payment of managerial remuneration, Directors'' qualifications, positive attributes, independence of Directors and other related matters as provided under Section 178(3) of the Companies Act, 2013 is furnished in Annexure II and forming part of the Board''s Report.

RELATED PARTY TRANSACTIONS

In line with the requirements of the Companies Act, 2013 and Listing Regulations, your Company has formulated a Policy on Related Party Transactions, which is also available on the Company''s website www.bagfilms.com.

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 placed before the Audit Committee for review and approval and were in Ordinary Course of the Business and at Arm''s Length basis.

The particulars of related parties transactions referred to in subsection (1) of section 188 of the Companies Act, 2013 including certain arm''s length transactions under third proviso thereto are dis

disclosed in Form No. AOC -2 in Annexure III forming part of the Board''s Report.

VIGIL MECHANISM

The company has a Whistle Blower Policy to establish a vigil mechanism for Directors and employees of the Company to report concerns about unethical behavior, actual or suspected fraud or violation of the company''s code of conduct or ethics policy to the Audit Committee. There is no restriction for reporting any such occurrence and all the employees have uninterrupted access for reporting their concern in confidence to the Audit Committee.

The details of the Whistle Blower Policy are posted on the website of the Company at www.bagfilms.com .

office of the Company during business hours on working days up to the date of the ensuing Annual General Meeting. If any member is interested in obtaining a copy thereof, such member may write to the Company Secretary in this regard.

Information Required Under Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. All employees are covered under this policy. No complaints were received by the committee during the year.

Material Events Occurred between the end of Financial Year to which the Financial Statement relates and the Date of the Report:

No material event has occurred between the end of Financial Year 2017-18 and the date of this Report which has effect over the financial position of the company.

Additional Information

The consolidated financial statements of the Company form part of this Annual Report. The Audited Annual Accounts and related information of the Company''s subsidiaries will be made available upon request. These documents will also be available for inspection during business hours at the Company''s registered office in Delhi, India. The subsidiary companies'' documents will also be available for inspection at the respective registered offices of the subsidiary companies during business hours.

ACKNOWLEDGEMENTS

Your Directors thank the Central and State Governments Departments, organizations and agencies for the continued help and co-operation extended by them.

Your Directors also gratefully acknowledge all stakeholders of the Company viz. viewers, producers, vendors, members, stock exchanges, auditors, consultants, banks and other business partners for the excellent support received from them during the year. The Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company''s wellbeing.

For and on behalf of the Board of Directors

B.A.G. Films and Media Limited

Anurradha Prasad

Chairperson cum Managing Director

(DIN:00010716)

Place: Noida

Date: 28.05.2018

Director’s Report