172@29@16@58!~!172@29@0@53!~!|commonstore|commonfiles|moneycontrol_header.php?cid=0&s_cid=0&radar_off=0&is_revamped_header=0&is_responsive=1&sec=PNC_ANNUALREPORT&priceinter=1&frommc=1!~!|commonstore|commonfiles|moneycontrol_header.php
Moneycontrol
SENSEX NIFTY
you are here:

Saregama India Ltd.

BSE: 532163 | NSE: SAREGAMA | Series: NA | ISIN: INE979A01017 | SECTOR: Media & Entertainment

BSE Live

Aug 10, 16:00
496.50 37.05 (8.06%)
Volume
AVERAGE VOLUME
5-Day
2,467
10-Day
4,583
30-Day
3,154
3,627
  • Prev. Close

    459.45

  • Open Price

    455.00

  • Bid Price (Qty.)

    496.50 (48)

  • Offer Price (Qty.)

    496.50 (2)

NSE Live

Aug 10, 15:59
497.70 38.05 (8.28%)
Volume
AVERAGE VOLUME
5-Day
33,876
10-Day
65,659
30-Day
37,474
84,413
  • Prev. Close

    459.65

  • Open Price

    469.50

  • Bid Price (Qty.)

    0.00 (0)

  • Offer Price (Qty.)

    497.70 (2)

Annual Report

For Year :
2019 2018 2017 2016 2015 2014 2013 2012 2011

Director’s Report

The Directors are pleased to present the Seventy Second Annual Report of Saregama India Limited along with the audited accounts for the year ended 31st March, 2019.

1. FINANCIAL SUMMARY

The performance of your Company for the year ended 31st March, 2019 is summarized below:

(Rs. in Lakhs)

Particulars

Consolidated

Standalone

Consolidated

Standalone

Year ended 31st March, 2019

Year ended 31st March, 2019

Year ended 31st March, 2018

Year ended 31st March, 2018

Total income

60113.00

58391.01

36677.86

35982.51

Profit/(Loss) from operations

8467.97

8226.52

3892.39

4111.64

Exceptional item

NIL

NIL

NIL

NIL

Provision for Contingencies

NIL

NIL

NIL

NIL

Profit before tax

8467.97

8226.52

3892.39

4111.64

Tax Expense

Deferred Tax Charged / (Credit)

904.80

904.80

80.66

80.66

Current tax

2130.51

2128.70

981.56

980.25

Net profit (after tax and exceptional items)

5432.66

5193.02

2830.17

3050.73

Proposed Dividend (including tax thereon)

629.67

629.67

629.67

629.67

Transfer to general reserve

NIL

NIL

NIL

NIL

Free Reserves

21011.56

22704.36

16202.83

18115.62

Your Board is pleased to report a profit ofRs. 5193.02 lakhs on a standalone basis for the year 2018-19.

Further, no amount shall be transferred to reserves.

2. DIVIDEND

Your Board is pleased to recommend a dividend of Rs.3.00 per share for the year ended 31st March, 2019 subject to the approval of shareholders at the ensuing Annual General meeting.

3. SHARE CAPITAL

At the beginning and at the end of the financial year the issued and paid up share capital of the Company was Rs.17,41,04,920 divided into 1,74,10,492 shares of Rs.10/- each.

4. OPERATIONS/ STATE OF COMPANY’S AFFAIRS

This forms part of the Management Discussion and Analysis Report forming part of the Annual Report.

5. CORPORATE GOVERNANCE

Your Company has adopted a Code of Conduct (the Code) for its Directors and Senior Management personnel, who have affirmed compliance with the Code.

The adoption of the Code stems from the fiduciary responsibility that the Directors and the Senior Management have towards the stakeholders of the Company.

Your Board of Directors is committed to good governance practices based on principles of integrity, fairness, transparency and accountability for creating long-term sustainable shareholder value.

The Report on Corporate Governance as under applicable Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the Annual Report.

A certificate from M R and Associates, Practicing Company Secretary regarding compliance of the Corporate Governance requirements as per relevant provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the Annual report. Further, information about all elements of remuneration package etc. of individual directors forms part of the Annual Report.

6. PREVENTION OF SEXUAL HARASSMENT

The Company has complied with the provisions relating to constitution of Internal Complaints Committee under The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. The said Committee has been set up to redress complaints received regarding sexual harassment at workplace. During the year under review, Company has not received any complaints on sexual harassment.

7. PUBLIC DEPOSITS

The Company has not accepted any deposits from the public falling within the ambit of Section 73 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014.

8. EXTRACT OF ANNUAL RETURN

The Extract of Annual Return in Form MGT-9 pursuant to Section 92(3) of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014 is annexed as ANNEXURE-A to this Report and the same is available on the website of the company www. saregama.com.

9. CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company and its subsidiaries have been prepared in accordance with the provisions of the Act read with the Companies (Accounts) Rules, 2014, applicable Accounting Standards and the SEBI (Listing Obligation and Disclosure requirements) Regulations, 2015 and it forms part of the Annual Report. Pursuant to Section 129(3) of the Act, a statement containing the salient features of the financial statements of the subsidiary companies for the F.Y. 2018-19 is attached to the Financial Statements for the F.Y. 2018-19 in Form AOC-1. The Company will make available the said financial statements and related detailed information of the subsidiary companies upon request by any member of the Company or its subsidiary companies. These financial statements will also be kept open for inspection by any Member at the Registered Office of the Company.

Pursuant to the provisions of the Companies Act, 2013, the Audited financial statements of the Company, consolidated financial statements along with relevant documents and separate Audited Accounts in respect of subsidiaries, are available on the website of the Company viz.www.saregama.com.

10. SUBSIDIARY COMPANIES, JOINT VENTURE AND ASSOCIATE COMPANIES:

During the year under review, details of Companies/entities which have become or ceased as subsidiary Company, associates and joint ventures, are as under:

Company which have become subsidiary Company:

Saregama FZE - Wholly Owned Subsidiary of Saregama India Limited (“Company”).The Company has invested in 100% share capital of Saregama FZE comprising of 100 shares ofAED 1,000 each aggregating to AED 1,00,000. .

11. DIRECTORS

As per the relevant provisions of Companies Act, 2013 and SEBI (LODR) Regulations, 2015, during the period under review, the following changes took place in the office of Directors of the Company:

Due the sad demise of Mrs. Sushila Goenka and Mr. Bhaskar Raychaudhuri on 15.07.2018 and 20.11.2018 respectively, they ceased to be Directors of the Company.

The Board of Directors at its meeting held on May 29, 2018 approved the appointment of Mrs. Avarna Jain as a Non-Executive Director of the Company w.e.f. 29.05.2018.

Mr. Ghanashyam Bhagwan Aayeer relinquished his office as a CFO and Whole-Time Director w.e.f. 28.05.2018 due to his retirement from the services of the Company.

At the ensuing Annual General meeting, Mrs. PreetiGoenka(DIN: 05199069) is liable to retire by rotation and being eligible offers herself for re-appointment as a Director of the Company.

The Board of Directors of the Company at its meeting held on May 8, 2019 has approved the re-appointment of Mr. Vikram Mehra for a period of 5 years subject to the approval of shareholders at the ensuing Annual General meeting.

12. KEY MANAGERIAL PERSONNEL

During the year under review, the Board of Directors at its meeting held on May 29, 2018 approved the appointment of Mr. Vineet Garg as the Chief Financial Officer with effect from May 29,2018in place of Mr. Ghanashyam Bhagwan Aayeer who relinquished his office as a CFO and Whole-Time Director w.e.f. 28.05.2018 due to his retirement from the services of the Company.

13. BOARD EVALUATION

Pursuant to the provisions of the Act and the corporate governance requirements as prescribed by SEBI (Listing Obligation and Disclosure requirements) Regulations, 2015, the Board of Directors (“Board”) has carried out an annual evaluation of its own performance, and that of its Committees and individual Directors.

The criteria for performance evaluation of the Board included aspects like Board composition and structure; effectiveness of Board processes, information and functioning etc. The criteria for performance evaluation of Committees of the Board included aspects like composition of Committees, effectiveness of Committee meetings etc. The criteria for performance evaluation of the individual Directors included aspects on contribution to the Board and Committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings etc. In addition the Chairperson was also evaluated on the key aspects of his role.

14. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

Pursuant to requirement of Securities and Exchange Board of India vide Circular no. CIR/CFD/POLICY CELL/7/2014 dated September 15, 2014, the Company has in place a programme for familiarisation of the Independent Directors with the Company, details of which is available on the website of the company. https://www. saregama. com/static/investorsRs.srgm_tracker=footer

15. NOMINATION AND REMUNERATION POLICY

The Company has in place a Remuneration Policy for the Directors, Key Managerial Personnel, Senior Management and other Employees pursuant to the provisions of the Act and Regulation 19 of the SEBI (Listing Obligation and Disclosure requirements) Regulations, 2015. The key changes, inter alia, include addition/amendment in the definition of senior management.

The salient features and objectives of the policy are as follows:

- To formulate the criteria and terms to determine qualifications, attributes and independence of Directors;

- To identify the qualification, key attributes and profile required of persons who may be appointed in Senior Management and Key Managerial positions;

- To recommend remuneration of the Directors, Key Managerial Personnel and Senior Management employees and other employees based on the Company’s size of business, financial position and trends and practices prevailing in similar companies in the industry;

- To devise mechanism and carry out evaluation of the performance of Directors;

- To devise and achieve diversity on the composition of Board, an essential element to support quality of performance;

- To prepare policies or principles to retain, motivate and promote talent and create a sense of participation and ownership.

- To carry out such other functions as is mandated by Board of Directors from time to time or is enforced by any statutory notification, amendment or modification as may be applicable.

- To perform such other functions as may be necessary or appropriate for performance of duties Further, the said policy is available on the website of the Company www.saregama.com.

16. BOARD MEETINGS

During the period under review, 5 (five) Board Meetings were held, details of which are given in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Act and Regulation 17 of SEBI (Listing Obligation and Disclosure requirements) Regulations, 2015.

Currently the Board has 6(six) committees, namely, Audit Committee, Nomination and Remuneration Committee, Corporate Social Responsibility (“CSR”) Committee, Stakeholders’ Relationship Committee, Committee of Directors and Finance Committee.

Details of the composition of the Board and its Committees and changes therein and details of the Meetings held, attendance of the Directors at such Meetings and other relevant details are provided in the Corporate Governance Report.

17. AUDIT COMMITTEE

The Audit Committee comprises of the following members:

Name of the Member

Position

Category of Director

Mr. Umang Kanoria*

Chairman

Non-executive Independent Director

Mr. Noshir Framjee

Member

Non-executive Independent Director

Mr. Santanu Bhattacharya

Member

Non-executive Independent Director

Mr. Bhaskar Raychaudhuri#

Member

Non-executive Independent Director

*Appointed as Chairman of the Committee w.e.f. May 11, 2018.

# Expired on 20.11.2018 and hence ceased to be a member of the Committee.

Note - Further, details relating to the Audit Committee are provided in the Corporate Governance Report forming part of the Annual report.

18. VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has adopted a Whistle Blower Policy establishing vigil mechanism, to provide a formal mechanism to the Directors and employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Company’s Code of Conduct. The Policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee. The policy of vigil mechanism is available on the Company’s website: (Web link: https://www.saregama.com/static/investorsRs.srgm_tracker=footer)

19. PARTICULARS OF EMPLOYEES

The information as required in terms of Section 197 (12) of the Act, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is set out in an annexure to this Report. However, the Report and the Accounts are being sent to all the Shareholders of the Company excluding the aforesaid information. Any shareholder interested in obtaining such information may write to the Company Secretary at the Registered Office of the Company. The said information is also available for inspection at the Registered Office during working hours up to the date of the Annual General Meeting.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided as “Annexure B” to this Report.

20. CORPORATE SOCIAL RESPONSIBILITY (CSR)

The brief outline of the CSR Policy of the Company along with the Annual Report on CSR activities is set out in “Annexure C” of this report. The policy is available on the Company’s website. (Web link: https://www.saregama.com/static/investorsRs.srgm_tracker=footer)

21. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Particulars of the loans given, investments made, guarantees given or securities provided during the year and the purpose for which the loans / guarantees / securities are proposed to be utilized by the recipient of such loan / guarantee / security is given in Note 44 to the financial Statement.

22. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts/arrangements/ transactions entered by the Company with the Related Parties during the financial period were on an Arm’s length basis and were in compliance with the applicable provisions of the Act and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. There were no materially significant transactions entered into by your company during the year and hence no information is required to be provided under Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014.

23. MATERIAL CHANGES AND COMMITMENT AFFECTING THE FINANCIAL POSITION OF THE COMPANY

On 12th April 2019, the company has received an amount of Rs.32,18,72,029 (Rupees Thirty Two Crore Eighteen Lakhs Seventy Two Thousand And Twenty Nine Only) from National Insurance Company Limited towards full and final settlement of claim for loss of stocks of Radio Music Player (Carvaan, Carvaan Mini) and Music Cards of the Company due to Fire accident on or about 1st April 2018 in Bhiwandi, Mumbai.

24. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

During the year under review, there were no significant or material orders passed by the Regulators or Courts or Tribunal which would impact the going concern status of the Company and its future operation.

25. RISK MANAGEMENT

The Company is exposed to inherent uncertainties owing to the sectors in which it operates. A key factor in determining a company’s capacity to create sustainable value is the risks that the company is willing to take (at strategic and operational levels) and its ability to manage them effectively. Many risks exist in a company’s operating environment and they emerge on a regular basis. The Company’s Risk Management processes focuses on ensuring that these risks are identified on a timely basis and addressed.

The Company is well aware of the above risks and as part of business strategy has put in a mechanism to ensure that they are mitigated with timely action. The Company has a Risk Management framework to identify, evaluate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on the business objectives and enhance the Company’s competitive advantage.

26. INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Audit Committee reviews adequacy and effectiveness of the Company’s internal control environment and monitors the implementation of audit recommendations, including those relating to strengthening of the Company’s risk management policies and systems.

27. AUDITORS

A) STATUTORY AUDITORS

M/s BSR& Co. LLP, Chartered Accountants, Firm Registration No. 101248W/W-100022 was appointed as Statutory Auditors of the Company for a period of 5 years by the shareholders at the Annual General Meeting held on July 28, 2017. The Statutory Auditors report does not contain any qualification/reservation/adverse remark or disclaimer.

B) INTERNAL AUDITORS

M/S Ernst and Young have been appointed as Internal Auditors for FY 2019-20.

C) SECRETARIAL AUDITORS

Pursuant to the provisions of Section 204 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s M R and Associates, Practicing Company Secretaries has been appointed as Secretarial Auditor, to undertake Secretarial Audit of the Company for the financial year 2019-20. The report of the Secretarial Auditor is annexed to this report as “Annexure D”. The Secretarial Audit Report does not contain any qualification/reservation/adverse remark or disclaimer.

D) COST AUDITORS

Pursuant to Section 148 and applicable provisions of the Companies Act, 2013 and the Companies (Cost Records and Audit) Rules 2014, the Company is required to appoint cost auditor for audit of cost records maintained by the Company in respect of the financial year ending March 31, 2019 and March 31, 2020.

Your Directors have on the recommendation of the Audit committee, appointed M/s. Shome and Banerjee, Cost Accountants, as the Cost Auditor to audit the cost records for the financial year ending March 31, 2020.

Remuneration payable to the Cost Auditor is subject to ratification by the members of the Company. Accordingly, a resolution seeking members’ ratification for the remuneration payable to Shome and Banerjee, Cost Accountants, is included in the Notice convening the Annual General Meeting, along with relevant details, including the proposed remuneration.

28. DIRECTORS’ RESPONSIBILITY STATEMENT

The Board of Directors acknowledge the responsibility for ensuring compliances with the provisions of section 134(3)(c) read with section 134(5) of the Companies Act, 2013 in the preparation of the annual accounts for the year ended March 31, 2019 and to the best of their knowledge and ability, confirm that:

a) in the preparation of the annual accounts, the applicable accounting standards had been followed alongwith proper explanation relating to material departures;

b) the directors had 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 as at March 31, 2019 and of the profit and loss of the company for that year on that date;

c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d) the directors had prepared the annual accounts on a going concern basis

e) the directors had laid down proper systems of internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

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

29. INDEPENDENT DIRECTORS DECLARATION

The company has received the necessary declaration from Independent Directors that they meet the criteria of independence as provided in Section 149 of the Companies Act. Further the Company has formulated a Code of Conduct for Directors and Senior Management Personnel and all the Directors and Senior Management Personnel have complied with the Code.

30. REPORTING OF FRAUD BY AUDITORS

There are no instances of fraud reported by the Auditors during FY 2018-19.

31. FOREIGN EXCHANGE EARNINGS AND OUTGO

The Foreign Exchange earned in terms of actual inflows during the year and the Foreign Exchange outgo during the year in terms of actual outflows is aiven below:

32. EMPLOYEES STOCK OPTION SCHEME

The Members of the Company, at its Annual General Meeting held on 26th July, 2013, approved the implementation of Saregama Employees Stock Option Scheme - 2013. Your Company is desirous to extend the said benefits also to employees of the subsidiary companies.

Your Company has further formulated the Saregama Stock Appreciation Rights Scheme - 2014 for benefit of its employees as per applicable regulations of Securities and Exchange Board of India as amended from time to time.

The Members of the Company, at its Annual General Meeting held on July 27, 2018 approved the implementation of Saregama Stock Appreciation Rights Scheme - 2018. Your Company is desirous to extend the said benefits also to employees of the subsidiary companies. The Members of the Company, at its Annual General meeting held on July 27, 2018, the Company has amended various clauses of Saregama Employees Stock Option Scheme - 2013 and provided flexibility to the Nomination and Remuneration Committee to increase or decrease the vesting periods depending on the performance criteria etc. if it considers expedient.

Disclosures with respect to Stock Options and Stock Appreciation Rights, as required under Regulation 14 of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (‘the Regulations’), is available on the Company’s website ‘www. saregama.com’ .

A certificate from M/s BSR & Co. LLP, Chartered Accountants, Statutory Auditors, with respect to the implementation of Employee Stock option Scheme 2013and Stock Appreciation Rights scheme 2014 and 2018 would be placed before the members at the ensuing AGM and a copy of the same shall be available for inspection at the Registered Office of the Company.

33. RIGHTS ISSUE

Out of the 53,38,628 equity shares issued for cash at a premium of Rs.35/- (issue price - Rs.45/-) pursuant to the Rights Issue in 2005, allotment of 5,290 (31.03.2018 - 5,290) equity shares (relating to cases under litigation / pending clearance from concerned authorities) are in abeyance as on 31st March, 2019.

34. RATIO ANALYSIS

KEY RATIOS

Standalone

March-19

March-18

Debtor Turnover (Days)

78.6

82.5

Inventory Turnover (Days)

48.6

30.2

Interest Coverage Ratio

13.6

13.2

Current Ratio

1.6

1.6

Debt to Equity Ratio

25%

7%

Operating Profit Margin

15%

16%

Net Profit Margin

10%

9%

Note:

1. Inventory Turnover ratio showing more than 60% increase in FY19 as against last year is due to increase in inventory of digital films on account of higher number of films under productions coupled with increase in inventory of carvaan considering Company maintains inventory equals to 90 days average sales (Company sold 903 units of Carvaan in FY19 as against 389 Units in FY18).

2. On 2nd April 2018, there was a fire in the godown (of third party service provider) damaging stocks of the Company. In order to replenish the stock lost by fire, Company has taken short term borrowing from Bank resulting in higher Debt Equity Ratio in current year as against previous year. The aforesaid borrowing has been repaid subsequent to the year end on receipt of Insurance claim.

35. COMPLIANCE WITH SECRETARIAL STANDARDS

The Company is in compliance with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI) and approved by the Central Government under Section 118 (10) of the Companies Act, 2013 for the Financial Year ended 2018-19.

36. ACKNOWLEDGEMENT

Your Directors would like to express their sincere appreciation to its stakeholders financial institutions, bankers and business associates, Government authorities, customers and vendors for their co-operation and support and looks forward to their continued support in future. Your Directors also place on record, their deep sense of appreciation for the committed services by the employees of the Company.

FOR AND ON BEHALF OF THE BOARD OF DIRECTORS

Sanjiv Goenka Vikram Mehra

Chairman and Non-Executive Director Managing Director

DIN: 00074796 DIN: 03556680

Date: May 8, 2019

Place: Kolkata

Director’s Report