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तेजस नेटवर्क्स निदेशकों की रिपोर्ट, तेजस नेटवर्क्स निर्देशकों द्वारा रिपोर्ट

तेजस नेटवर्क्स

बीएसई: 540595  |  NSE: TEJASNET  |  ISIN: INE010J01012  |  Telecommunications - Equipment

खोजें तेजस नेटवर्क्स कनेक्शन Mar 17
निदेशकों की रिपोर्ट वर्षांत : Mar '19

Board's Report

Dear Members,

Your Directors are pleased to present the 19th Annual Report together with the audited financial statements for the financial year ended March 31, 2019. The consolidated performance of the Company has been referred to wherever required.

1. Results of our operations and state of affairs

in Rs crore except per share data

Particulars

Standalone

Consolidated

2019

2018

2019

2018

Revenue from operations (1)

894.03

761.07

900.32

767.44

Other Income

36.64

27.22

36.69

27.83

Total income

930.67

788.29

937.01

795.27

Expenses

 

 

 

 

Cost of materials consumed

463.70

382.30

463.70

382.42

Excise duty

-

17.64

-

17.64

Employee benefit expense

117.60

88.65

123.66

92.26

Finance costs

16.88

13.45

17.00

13.40

Depreciation and amortization expense

65.88

61.27

65.88

61.27

Other expenses

117.14

118.34

116.75

122.24

Total expenses

781.20

681.65

786.99

689.23

Profit before tax

149.47

106.64

150.02

106.04

Income tax expense

 

 

 

 

Current tax

19.63

23.78

19.63

23.78

Deferred tax (benefit)

(16.85)

(24.26)

(16.85)

(24.26)

Total tax expense

2.78

(0.48)

2.78

(0.48)

Profit after tax

146.69

107.12

147.24

106.52

Other comprehensive income

 

 

 

 

Items that will not be reclassified to profit or loss

(1.72)

(1.61)

(1.72)

(1.61)

Items that will be reclassified to profit or loss

-

-

0.77

(0.15)

Total comprehensive income for the period

144.97

105.51

146.29

104.76

Retained earnings- opening balance

120.59

14.88

120.97

15.86

Add: Transferred from other reserve

-

0.20

-

0.20

Less: Items that will be reclassified to profit or loss

-

-

0.77

(0.15)

Retained earnings- closing balance

265.56

120.59

266.49

120.97

Earnings per equity share

 

 

 

 

Equity shares of par value Rs 10 each

 

 

 

Basic

16.07

12.48

16.13

12.41

Diluted

15.33

11.79

15.39

11.73

m Revenue from operations for the year ended March 31, 2018 was inclusive of excise duty of Rs 17.64 crore. Post introduction of Goods and Services Tax (GST), effective July 1, 2017 revenue from operations for the periods post June 30, 2017 is net of the related GST. Accordingly, the revenue for the year ended March 31, 2019 and the corresponding previous year are not strictly comparable.

in Rs crore
Financial Position

Particulars

Standalone

Consolidated |

2019

2018

2019

2018

Bank balances and deposits with maturity up to three months

16.41

213.48

16.90

214.19

Bank balances other than above

Current'1'

106.15

21.76

106.15

21.76

Deposits with original maturity of more than twelve months

0.12

0.04

0.12

0.04

Investment in mutual funds

86.55

76.52

86.55

76.52

Deposits with financial institutions disclosed under other current

160.00

205.00

160.00

205.00

financial assets Cash and cash equivalents including margin money

369.23

516.80

369.72

517.51

less: Balances held as margin money

(0.16)

(4.81)

(0.16)

(4.81)

Cash and cash equivalents excluding margin money

369.07

511.99

369.56

512.70

Net current assets'2'

578.89

317.10

590.75

327.42

Property, plant and equipment

30.68

35.98

30.68

35.98

Intangible assets (including under development)

109.82

85.60

109.82

85.60

Other non-current assets'3'

233.22

204.64

222.37

193.79

Total assets

1,321.68

1,155.31

1,323.18

1,155.49

Borrowings'4'

1.19

2.27

1.19

2.27

Non-current provisions

1.75

1.14

1.75

1.14

Total equity

1,318.74

1,151.90

1,320.24

1,152.08

Total equity and borrowings

1,321.68

1,155.31

1,323.18

1,155.49

. m Deposits with original maturity of more than three months but less than twelve months & Balances held as margin money or security against borrowings or guarantees

(2) current assets net of current liabilities as disclosed in balance sheet excluding the bank balances considered as cash and cash equivalents

(3> excluding bank balances considered as cash and cash equivalents

(4) including current borrowings and current maturities of long-term debt

Revenues

• Standalone

Our net revenues (net of taxes and component sales) from operations on a standalone basis grew by 18.7% to Rs 870.44 crore in fiscal 2019. Our domestic and export revenues comprise of 80% and 20% respectively of total revenue. Out of total revenue, 80% (previous year 82%) came from India, 8% (previous year 6%) came from Americas and 12% (previous year 12%) came from Rest of the World.

• Consolidated

Our net revenues (net of taxes and component sales) from operations on a consolidated basis grew by 18.5% to Rs 876.73 crore in fiscal

2019. Our domestic and export revenues comprise of 79% and 21% respectively of total revenue. Out of total revenue, 79% (previous year 82%) came from India, 8% (previous year 6%) came from Americas (previous year 6%) and 13% (previous year 12%) came from Rest of the World.

Profits

• Standalone

Our gross profit on a standalone basis amounted to Rs 359.77 crore (41.3% of net revenue) as against Rs 293.59 crore (40.0% of net revenue) in the previous year. The gross and net Research and development costs were 13.3% and 5.8% of our net revenue for the year ended March 31, 2019 as compared to 11.8% and 5.1% for the year ended March 31, 2018. Selling and marketing costs were 9.7% (previous year 10.6%) of our net revenue for the year ended March 31, 2019. The General and administrative expenses were 3.3% (previous year 3.3%) of our net revenue for the year ended March 31, 2019. The operating profit amounted to Rs 129.71 crore (14.9% of net revenue) as against Rs 92.87 crore (12.7% of net revenue) in the previous year. The profit before tax was Rs 149.47 crore (17.2% of net revenue) as against Rs 106.64 crore (14.5% of net revenue) in the previous year. The net profit was Rs 146.69 crore (16.9% of net revenue) as against Rs 107.12 crore (14.6% of net revenue) in the previous year.

• Consolidated

Our gross profit on a consolidated basis amounted to Rs 366.06 crore (41.8% of net revenue) for the year ended March 31, 2019 as against Rs 299.74 crore (40.5% of net revenue) in the previous year. The gross and net Research and development costs were 13.2% and 5.8% of our net revenue for the year ended March 31, 2019 as compared to 11.7% and 5.1% for the year ended March 31, 2018. Selling and marketing costs were 10.2% (previous year 11.4%) of our net revenue for the year ended March 31, 2019. The General and administrative expenses were 3.4% (previous year 3.4%) of our net revenue for the year ended March 31, 2019. The operating profit amounted to Rs 130.33 crore (14.9% of net revenue) as against Rs 91.61 crore (12.4% of net revenue) in the previous year. The profit before tax was Rs 150.02 crore (17.1% of net revenue) as against Rs 106.04 crore (14.3% of net revenue) in the previous year. The net profit was Rs 147.24 crore (16.8% of net revenue) as against Rs 106.52 crore (14.4% of net revenue) in the previous year.

Expenditure on property, plant and equipment -Standalone and Consolidated

On a standalone basis and consolidated basis, during the year, we incurred expenditure on property, plant and equipment of Rs 13.40 crore (previousyear Rs 18.27 crore), comprising, Rs 3.96 crore (previousyear Rs 5.67 crore) in Laboratory equipment, Rs 0.14 crore (previous year Rs 0.13 crore) in Networking equipment, Rs 0.41 crore (previous year Rs 0.46 crore) in Electrical Installation, Rs 2.86 crore (previous year Rs 0.89 crore) in Furniture and fixtures, Rs 0.21 crore (previous year Rs 0.31 crore) in Office Equipment, Rs 1.68 crore (previous year Rs 2.54 crore) in Computing Equipment, Rs 2.54 crore (previous year Rs 7.53 crore) in Cards/Prototypes, Rs 1.60 crore (previous year Rs 0.55 crore) in Servers and Rs Nil (previous year Rs 0.19 core) in Vehicles.

Capital Expenditure on intangible assets and intangible under development - Standalone and Consolidated

Our intangible assets comprises of computer software and product development expenditure. Additions of Rs 6.58 crore made in computer software, as against Rs 4.01 crore in the previous year. During the year, Rs 70.39 crore (previous year Rs 21.65 crore) was capitalised from intangible under development to product development. Capitalised product development gets amortised over a period of 24 months.

Additions to intangible under development for the year amounted to Rs 64.92 crore (previous year Rs 49.21 crore) on account of capitalisation of employee benefit expense and other expenses (refer note 23 and note 25 of standalone/consolidated financials).

Liquidity

We are practically a debt-free Company and maintain sufficient cash to meet our business requirements. Our principal source of liquidity are cash and cash equivalents and the cash flow we generate from the business. We understand that the liquidity in the Balance sheet is needed to cover financial & business risks and support future growth.

We have liquid assets of Rs 369.07 crore on standalone basis and Rs 369.56 crore on a consolidated basis as of March 31, 2019 as compared to Rs 511.99 crore and Rs 512.70 crore on standalone and consolidated basis respectively as of March 31, 2018.

The cash and cash equivalents on both standalone and consolidated basis include balance with banks, investment in liquid mutual funds and deposits with financial institutions. The details of these investments and deposits are disclosed under the 'current investments and current financial assets' section in the standalone and consolidated financial statements in this Annual report.

Earnings Per share

Basic earnings per share grew by 28.7% to Rs 16.07 (previous year Rs 12.48) at standalone level and by 29.9% to Rs 16.13 (previous year Rs 12.41) on consolidated basis.

Dividend

The Board of Directors aim to grow the business lines of the Company and enhance the rate of return on investments of the Shareholders. The Board periodically reviews the Company's ability and necessity to distribute dividends to its Shareholders, with a view to preserve the profitability and long term growth plans for the Company. The Board of Directors takes into account various factors including current and future earnings projections, current and future cash flow projections, capital expenditure requirements for current and future projects, contingencies, regulatory, political, economic factors while making a determination to transfer retained earnings to reserves in entirety or partially for a given year and to consequently distribute dividend if any. The Board of Directors, in accordance with Clause 43A of the Listing regulations, adopted a Dividend distribution policy setting out the parameters and circumstances including external and internal factors and financial parameters that will be taken into account in determining the distribution of dividend and also the circumstances under which the Shareholders of the Company may or may not expect dividend and how the retained earnings shall be utilized. Subject to these parameters, the Board may distribute dividend upto 25 % of the free cash flow of the corresponding financial year or out of retained earnings of the previous years, subject to applicable laws and requisite approvals, if any. Free cash flow is defined as net cash generated by operating activities less capital expenditure as per the consolidated statement of cash flows prepared under Ind AS. Dividend payout includes Dividend Distribution Tax (DDT). The details of Dividend Distribution Policy is placed on the Company's website https://www.tejasnetworks.com/policies-codes.php

The Board of Directors are pleased to recommend a maiden final dividend of Re. 1/- per equity share on a face value of Rs 10/- per share for year ended March 31, 2019 subject to the approval of the Shareholders in their 19th Annual General Meeting slated to be held on July 25, 2019. The dividend payout for the financial year ended March 31, 2019 will absorb Rs 11.06 crore including Dividend Distribution tax of Rs 1.89 crore. The exact amount of payout of dividend will depend upon the number of shares outstanding on the date of the book closure.

The Register of Shareholders and Share Transfer Books of the Company will remain closed from July 19, 2019 to July 25, 2019 (both days inclusive). Dividend for the financial year ended March 31, 2019, as recommended by the Board of Directors of the Company, if approved at the 19th Annual General Meeting by the Shareholders, will be paid within 30 days from the date of the 19th Annual General Meeting.

Share Capital

During the year under review, the Company has issued 9,00,819 shares consequent to the conversion of the 8,96,692 stock options and 4,127 Restricted Stock Units into equity shares of the Company by the eligible employees and hence the outstanding paid up equity share capital stands at Rs 91,71,95,790 comprising of 9,17,19,579 equity shares of Rs 10/ each fully paid up, as on March 31, 2019.

Particulars of loans, guarantees or investments

The Company makes investments or extends loans/ guarantees to its wholly owned subsidiaries for their business purposes as and when required by them for its emergent business requirements. The details of loans, guarantees and investments covered under Section 186 of the Companies Act, 2013 along with the purpose for which such loan or guarantee was utilized by the recipient forms part of the Notes to standalone financial provided in the Annual Report. During the year ended March 31, 2019, there were no loans, guarantees or investments made by the Company to its wholly owned subsidiaries either for their business purposes or for its emergent business requirements.

Transfer to reserves

The Board of Directors has decided to retain the entire amount of profits for the financial year ended March 31, 2019 in the profit and loss account and does not propose to transfer amounts to the general reserve out of the amount available for appropriation. An amount of Rs 145.52 crore on a consolidated basis and Rs 144.97 crore on standalone basis for the year ended March 31, 2019 is retained in the profit and loss account.

Fixed deposits

The Company is a debt free Company and has not accepted any fixed deposit including from the public and, as such, no amount of principal or interest was outstanding as of March 31, 2019.

Micro, Small and Medium (MSME) Enterprises

With the objective of promotion and development and enhancing the competitiveness of small and micro enterprises, the Central Government vide notification dated 2nd November 2018 has directed that all Companies, who get supplies of goods or services from micro and small enterprises and whose payments to micro and small enterprise suppliers exceed forty five days from the date of acceptance or the date of deemed acceptance of the goods and services shall furnish details about the amounts due and the reasons for delay thereof.

Your Company as on March 31, 2019 has made payments to all MSME suppliers within 45 days from the date of acceptance and there are no outstandings as on March 31, 2019 which exceeds 45 days from the date of acceptance. Further the Company has registered with Trade Receivables Discounting System (TReDS) in compliance with Notification No. 5621 dated November 2, 2018 issued by Ministry of Micro, Small and Medium Enterprises which requires companies with a turnover of more than Rs 500 crore to be registered on the platform.

Credit Rating

Rating committee of ICRA have reaffirmed the long term rating for the Line of Credit at [ICRA] A (pronounced as ICRA A) with the outlook on the long term rating as Positive. The rating Committee of ICRA has also reaffirmed the short term rating for the captioned LOC at [ICRA] Al (pronounced ICRA A). The Positive outlook reflects ICRAs expectation that the Company will favorably benefit from the extensive experience and technical competence of its management, its strong capital structure and liquidity profile, along with increasing revenue contribution from segments which provide stability to the business. The credit rating letter is placed on the Company's website at https://www.tejasnetworks.com/stock-exchange-filing-other-filing.php

Related parties transactions

In line with requirement of the Companies Act, 2013 and Listing Regulations, your Company has formulated a Policy on Related Party Transactions. The Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and Related Parties. This policy specifically deals with the review and approval of Material Related Party Transactions keeping in mind the potential or actual conflicts of interest that may arise because of entering into these transactions. All Related Party Transactions are placed before the Audit Committee for review and approval. Prior omnibus approval is obtained for Related Party Transactions on a quarterly basis for transactions which are of repetitive nature and / or entered in the ordinary course of business and are at Arm's Length. 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.

The Company has not entered into any materially significant related party transactions with its Directors, or Management, their subsidiaries or relatives, etc. that may have potential conflict with the interests of the Company at large. The Company has received disclosures from the senior managerial personnel confirming that they have not entered into any material, financial and commercial transactions in which they or their relatives may have a personal interest. Transactions with the related parties as per requirements of Indian Accounting Standard 24 are disclosed in Note 30.6 to the financial statements in the Annual Report and they are not in conflict with the interest of the Company at large. The Policy on Related Party Transactions as approved by the Board is available at the Company's website at https://www.tejasnetworks. com/policies-codes.php. Particulars of contracts or arrangements with related parties referred to in Section 188(1) of the Companies Act, 2013, in the prescribed Form AOC-2, is attached as 'Annexure 2' to the Board's report.

Management's Discussion and Analysis

The Management Discussion and Analysis forms a part of the Board's Report. All matters pertaining to industry structure and developments, opportunities and threats, segment-wise performance, outlook, risks and concerns, internal control systems and adequacy, discussion on financial and operational performance and material developments in human resources are discussed in the said Report. The Management Discussion and Analysis report for the year under review and as stipulated in Regulation 34 under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015 (Listing Regulations) is presented in a separate section forming part of the Annual Report.

Business Integrity and Ethics

Integrity is one of the fundamental values of your Company. Your Company never compromises integrity in its decision making or during the pursuit of its business goals. In this complex and heavily regulated industry, it is the core responsibility to do everything to earn and keep the trust of all stakeholders. Your Company's deep legacy of integrity and ethical conduct engrains into compliance with the law and with the Company's policies. Your Company's management is fully engaged in establishing a strong culture and is actively involved to ensure that Company values and standards are prioritized at all levels of the organization.

Under the pillar of Business Integrity, your Company communicates its Code of Business Principles (Code) internally and externally. All Company employees are required to undertake mandatory annual training on our Code and extend through our entire value chain including our employees, contractors and third parties. The Company also requires its third-party business partners to adhere to business principles consistent with its own. These expectations are set out in our Code of Conduct for Vendors/ Suppliers and is placed in the website at https://www.tejasnetworks.com/policies-codes.php

The Annual declaration from the Managing Director and CEO stating that the Company has adopted a code of conduct for its employees including Managing Director, Non Executive Directors and Independent Directors and has received the declaration of compliance with the Code of Conduct as applicable to them.

Indian Accounting Standards (Ind AS)

The Financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015 notified under Section 133 of the Companies Act, 2013 (the Act) and other relevant provisions of the Act. Significant accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy in use. Please refer note no. 2 of the standalone financials for significant accounting policies.

Risk management

The Company has a robust 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. The business risk framework defines the risk management approach across the enterprise at various levels, including documentation and reporting. Robust and proactive compliance programs implemented at your Company includes monitoring, risk assessment, compliance education and coaching and active encouragement of whistle blower system. The policies, compliance training and resources put in place aimed at identifying and resolving potential issues in timely manner and making all efforts to make compliance systematic in all our operations. Further, Company's open door and anti-retaliation policies provides tremendous encouragement and offers a retaliation free environment to ask questions and raise concerns.

In line with the Listing Regulations, the Board of Directors of the Company has constituted a Risk Management Committee to frame, implement, and monitor the risk management plan for the Company. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The Company has an elaborate Risk Charter and Risk policy defining risk management governance model, risk assessment and prioritisation process. The Risk Management Committee reviews and monitors the key risks and their mitigation measures periodically and provides an oversight to the Board on Company's risks outlined in the risk registers. The Audit Committee has additional oversight in the area of financial risks and controls. The major risks identified by the businesses and functions are addressed through mitigating actions. The Risk Management Charter and Policy as adopted by the Board is available on the Company's website at https://www.tejasnetworks. com/policies-codes.php

Board Charter / Policies

During the year under review, the Board has adopted the Charters of the Nomination and Remuneration Committee, Risk Management Committee, Corporate Social Responsibility Committee, Stakeholders Relationship Committee and revised the Audit Committee Charter. It has also adopted the Risk Management Policy and revised the Nomination and Remuneration Policy. The details of the charter/ policies/ codes as adopted by the Board are provided in Annexure 9 to the Board report.

Material changes and commitments affecting financial position between the end of the financial year and date of the report

• Reconstitution of the Committees of the Board - The Committees of the Board has been reconstituted with effect from April 22, 2019.

• Payment of Dividend -The Board of Directors recommended a maiden final dividend of Re. 1/- per equity share on a face value of Rs 10/- per share for year ended March 31, 2019 subject to the approval of the Shareholders in their 19th Annual General Meeting slated to be held on July 25, 2019.

• Re-appointment of Sanjay Nayak as Managing Director (MD) and Chief Executive Officer (CEO) - The Board has recommended the re-appointment as MD and CEO for a further period of 5 years from January 1, 2020 till December 31, 2024 on terms and conditions including remuneration as set out in the Notice of the 19th Annual General Meeting.

2. Company Overview

Tejas Networks is an India-based optical and data networking products Company. Tejas designs, develops and sells high-performance and cost-competitive products to telecommunications service providers, internet service providers, utilities, defence and government entities in over 75 countries. Tejas products utilize programmable software-defined hardware architecture with a common software code-base that delivers an app-like ease of development and upgrades of new features and technology standards. Tejas is ranked amongst top-10 suppliers in the global optical aggregation segment. A strong brand name coupled with long-standing client relationships help us be the employer of choice. Expertise in lean automation and continuous improvement help us increase productivity and being more for the client. Tejas seeks to differentiate in the market by delivering business value through deep domain expertise and technology prowess. We invest in offerings that help clients optimize their Cost of Revenues (CoR) instead of the traditional approach of optimizing just the SG & A expenses.

Subsidiaries

As on March 31, 2019 our Company has 2 subsidiaries:

• Tejas Communication Pte. Limited (wholly owned subsidiary)

• Tejas Communications (Nigeria) Limited (Stepdown subsidiary of Tejas Communication Pte. Ltd.)

Section 129(3) of the Companies Act, 2013 states that where the company has one or more subsidiaries, it shall, in addition to its financial statements, prepare a consolidated financial statement of the Company and of all subsidiaries in the same form and manner as that of its own and also attach along with its financial statement, a separate statement containing the salient features of the financial statements of its subsidiaries. Hence, the consolidated financial statements of the Company and all its subsidiaries are prepared in accordance with Ind AS 110 and Ind AS 111 as specified in the Companies (Indian Accounting Standards) Rules, 2015, which forms part of the annual report. Moreover, a statement containing the salient features of the financial statement of the Company's subsidiaries in the prescribed Form AOC-1, is attached as Annexure I to the Board's report. This statement also provides details of the performance and financial position of each subsidiary. In accordance with section 136 of the Companies Act, 2013, the audited financial statements and related information of the subsidiaries, wherever applicable, are available for inspection during regular business hours at our registered office in Bengaluru, India. The financial statement of the subsidiaries is also available on the Company's website and may be accessed at https://www.tejasnetworks.com/ financial-information-subsidiaries.php.

In line with the requirements of the Listing Regulations, a policy to determine a material subsidiary has been framed and the same can be accessed on the Company's website at the link https://www tejasnetworks.com/policies-codes.php. The audit committee reviews the financial statements of the Company subsidiaries. It also reviews the investments, if any, made by such subsidiaries, the statement of all significant transactions and arrangements entered into by subsidiaries, and the compliances of each materially significant subsidiary on a periodic basis. The minutes of Board meetings of the subsidiary companies are placed before the Board of your Company for review.

The Board of Directors hereby confirm that, no Company has become or ceased to be, joint venture or associate company other than striking off the name of vSave Energy Private Limited and

Liquidation of Tejas (Israel) Limited (100% Wholly Owned Subsidiaries) during the year within the meaning of Section 2(6) of the Act. There has been no material change in the nature of the business of the subsidiaries.

• vSave Enenrgy Private Limited (vSave) (CIN: U32201KA2013PTC071695)

vSave made an application on December 6, 2017 under Section 248(2) of the Companies Act, 2013, for removal of name of vSave, since vSave has discontinued its operations for the last few years and does not intend to carry on any activity in future. The Registrar of Companies, Karnataka issued a Notice dated July 28, 2018 -Notice of striking off and dissolution [Pursuant to sub-section (5) of Section 248 of the Companies Act, 2013 and Rule 9 of the Companies - Removal of Names of Companies from the Register of Companies Rules, 2016} in FORM No. STK - 7 dated July 28, 2018 stating that pursuant to sub-section (5) of Section 248 of the Companies Act, 2013 the name of vSave Energy Private Limited has been struck off the Register of Companies and vSave was dissolved. The amount written off in this regard is Rs 0.14 crore (provisioned during FY 2018).

• Tejas (Israel) Limited (Tejas Israel) - Company Registration Number-514369016

The Company, taking into account the adverse impacted revenues and the loss occurred on account of impairment of Intellectual Property and further considering the facts that there is no visibility on revival of operation of Tejas Israel despite the best of efforts made by the Company, wound up the operations of Tejas Israel. Tejas Israel filed necessary application with the respective authorities to dissolve and liquidate Tejas Israel in accordance with Article 319(2) to the Companies Ordinance (New Version) 5743-1983 (the Companies Ordinance). The Ministry of Justice, Corporations Authority, Companies Registrar, the State of Israel issued a Confirmation of Liquidation dated November 25, 2018 confirming receipt of the Liquidator Notice according to Section 338(c) of the Companies Ordinance (New Version) 5743 - 1983, together with copy of the final financial report. On November 25, 2018 the Notice was registered and Tejas Israel status was changed to Liquidated. The amount written off in this regard is Rs 54.19 crore (provisioned during FY 2013).

3. Human Resource Management

Several key initiatives on the Human Resources (HR) front were initiated during the financial year through a three-pronged approach - Capacity, Capability and Culture.

The focus on Talent Acquisition from campuses of premier institutes was aimed at sustaining the relationships with them and attracting the best talent available. The company also revamped its training of campus talent by making it more experiential - which led to their faster deployment in productive roles. During the year under review, the Human Resource department has focused its efforts in exploring new avenues to attract talent. One of the key channels introduced this year has been 'hackathons' - which led to a wider talent pool being available for hiring throughout the year.

Focus on right staffing and skilling in identified international markets was given greater emphasis for the purposes of spreading the organization's global footprint. The Company has put in significant focus on Leadership Development by introducing and sustaining Leadership programs. The Prevention of Sexual Harassment (POSH) committee was reconstituted and a series of sensitization sessions were carried out for all to refresh awareness on this important topic.

The Company completed the implementation of HRIS application suite - Darwin Box for enabling efficient and cost effective HR systems. The objective was also to improve the quality of people analytics available, enhancing the quality of decision-making. As a part of this, almost all HR processes were e-enabled including onboarding, goal setting, performance review, competency assessment, leave and exit management.

Your Company is committed to developing employees' competencies continually. This year, as a part of the performance management process, the specific competencies of all job-roles were assessed which have become a vital input for employees' individual development plan. This will also be the key input which will strengthen the learning program portfolio - available to all employees for their growth and development..

Particulars of employees

The ratio of the remuneration of each Director and Key Managerial Personnel (KMP) to the median of employees' remuneration and statement containing the names of top 10 employees in terms of remuneration drawn as per Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are provided in 'Annexure 8' which forms part of the Board's Report.

The statement containing particulars of employees posted in India throughout the year and in receipt of a remuneration of Rs 1.02 crore or more per annum, employees posted in India for part of the year and in receipt of Rs 8.5 lakhs or more a month and employees posted outside India and in receipt of a remuneration of Rs 60 lakhs or more per annum or Rs 5 lakhs or more a month is available on the Company's website at https://www.tejasnetworks.com/disclosures, php. The Annual Report are being sent to Shareholders excluding the aforesaid exhibit. Shareholders interested in obtaining this information may access the same from Company website or send a written request to the Company.

Employee Stock Options (ESOP) / Restricted Stock Units (RSU) The Company has the following ESOP / RSU Schemes in force:

• Tejas Networks Limited Employees Stock Option Plan - 2014 (ESOP Plan 2014);

• Tejas Networks Limited Employees Stock Option Plan -2014-A (ESOP Plan 2014 - A);

• Tejas Networks Limited Employees Stock Option Plan - 2016 (ESOP Plan 2016);

• Tejas Restricted Stock Unit Plan 2017 (RSU 2017).

The details of the ESOP / RSU Plans as required under the applicable provisions of the Act read with Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014, are provided in 'Annexure 7', which forms part of the Board's Report. After implementation of the RSU plan, Company did not grant any new options from the pool available from the current ESOP Schemes. The details of the ESOP / RSU Plans and the disclosure as required under Regulation 14 of the SEBI Listing Regulations, is available on the Company's website at https://www.tejasnetworks.com/disclosures.php

Disclosure under the Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal) Act, 2013 We have a mechanism in place to foster a positive work place environment free from harassment of any nature. We have institutionalized the Anti-Sexual Harassment Initiative (ASHI) framework, through which we address complaints of sexual harassment at the work place. We follow a gender-neutral approach in handling complaints of sexual harassment. Our ASHI policy applies to everyone involved in the operations of the Company, including vendors and clients.

We have also constituted an Internal Complaints Committee (ICC) in all locations across India to consider and address sexual harassment complaints in accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The cases are heard and resolved by an independent group. Our whistleblower policy assures complete anonymity and confidentiality of information to the reporting individual.

Keeping the objective of fostering a positive work place environment and free from harassment, we conduct the following awareness campaigns:

• Orientation of new joinees on the Anti-Sexual Harassment Initiative (ASHI) and contractual staff.

• New Joiners / Trainees / Interns / Third-party business partners were trained on the subject of Prevention of Sexual Harassment of Women at Workplace.

• Inside offices, women employees are discouraged from working beyond 8.00 p.m. In circumstances where late working becomes unavoidable, women employees are required to (i) Take a drop home from the Company approved cab service provider only; (ii) Be escorted by a male colleague/ security back home; (iii) Inform their Managers upon reaching home that they have reached safely.

The details of ASHI cases for the financial year ended March 31, 2019:

Number of cases filed Disposal by conciliation Disposal by disciplinary action(s)

Your Directors confirm that:

• The Company has constituted committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and complied with the provisions of the same.

• The Company is committed to provide a safe and conducive work environment to its employees during the financial year. Your Directors further state that during the financial year, there were no cases filed nor complaints received pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

4. Corporate Governance

Our Corporate Governance philosophy is about maximizing shareholder value legally, ethically and sustainably At Tejas, the goal of corporate governance is to ensure fairness to every stakeholder. We believe sound corporate governance is critical to enhance and retain investor trust. We always seek to ensure that our performance is driven by integrity and ethically. Our Board exercises its fiduciary responsibilities in the widest sense of the term. Our disclosures seek to attain the best practices in corporate governance. We also endeavor to enhance long-term shareholder value and respect minority rights in all our business decisions. Our Corporate governance report for the financial year ended March 31, 2019 forms part of this Annual Report. We wish to state that your Company has complied with all norms of corporate governance applicable to the Company and as envisaged under the Companies Act, 2013 and in the SEBI Listing Regulations.

Board Diversity

The Company recognizes that a Board composed of appropriately qualified members with a broad range of experience relevant to the business is important for effective corporate governance and sustained commercial success. The Company believes that it has a truly diverse Board which leverages on the skills and knowledge, industry or related professional experience, age and gender, which helps the Company to retain its competitive advantage. The Board has adopted the Board Diversity Policy to recognize the benefits of a diverse Board and to further enhance the quality of participation and performance. The policy on Board diversity is available on the Company's website https://wwwtejasnetwo rks.com/policies-codes.php

Board Governance Guidelines

The Company's governance guidelines on the effectiveness of the Board cover aspects relating to composition and role of the Board, Chairman and its Directors, Board diversity, definition of independence, term of Directors, retirement age and committees of the Board. The guidelines also cover key aspects relating to nomination, appointment, induction and development of Directors, Directors remuneration, oversight on subsidiary performances, code of conduct, Board effectiveness reviews and various mandates of Board committees.

Number of meetings of the Board

The Board met six times during the financial year, the details of which are given in the Corporate Governance Report that forms part of this Annual Report. The intervening gap between any two meetings is within the period prescribed by the Companies Act, 2013 read with SEBI Listing Regulations.

Policy on Directors' appointment and remuneration The current policy is to have an appropriate mix of Executive, Non-Executive and Independent Directors to maintain the independence of the Board and separate its functions of governance and management. As on March 31, 2019, the Board consists of six members (One Non-Executive and Non-independent Director, Two Executive and Whole-time Director, and Three Non-Executive and Independent Directors). The Board periodically evaluates the need for change in its composition and size.

The policy of the Company on Directors' appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters provided under sub-section (3) of Section 178 of the Companies Act, 2013, adopted by the Board, is available on the website of the Company at http://www.tejasnetworks.com/policies-codes.php.

The Company affirms that the remuneration paid to the Directors is as per the terms laid out in the nomination and remuneration policy of the Company. The Remuneration Policy and criteria for Board nominations are available on the Company's website at http ://website. tej asnetworks. com/policies-codes, php

Declaration by Independent Directors

The Company has received necessary declaration from each Independent Director of the Company under Section 149 (7) of the Companies Act, 2013 stating that the Independent Directors of the Company meet with the criteria of their Independence laid down in Section 149 (6) and 'Regulation 16(1) (b) of the Listing Regulations.

Board and Committee Evaluation

In terms of the requirement of the Companies Act, 2013 and the Listing Regulations, an annual performance evaluation of the Board is undertaken where the Board formally assesses its own performance with an aim to improve the effectiveness of the Board and the Committees. During the year, Board evaluation cycle was completed by the Company internally which included the evaluation of the Board as a whole, Board Committees and Peer evaluation of the Directors. The exercise was led by the Non-Executive Chairman along with the Chairperson of the Nomination and Remuneration Committee of the Company. The evaluation process focused on various aspects of the functioning of the Board and Committees such as composition of the Board and Committees, experience and competencies, performance of specific duties and obligations, governance issues, etc. The guidance note issued by SEBI on Board evaluation was duly considered while conducting the evaluation exercise. Separate exercise was carried out to evaluate the performance of individual Directors on parameters such as attendance, contribution and independent judgement.

Familiarization programme for Independent Directors To familiarize a new Independent Director with the Company, an information kit containing documents about the Company such as its annual reports, sustainability reports, annual presentations, recent press releases, research reports, code of business conduct and ethics and the memorandum and articles of association are provided. The new Independent Director individually meets with Board Member(s) and Senior Management. Visits to factory are organized for the Director to understand the Company's operations. The Company believes that the Board should be continuously empowered with knowledge of latest developments affecting the Company and the Industry. Apart from regular presentations on Company's business strategies and associated risks, expositions are made on various topics covering the telecom industry. Updates on relevant statutory changes and judicial pronouncements around industry related laws are regularly circulated to the Directors. Each Independent Director has complete and unfettered access to any of the Company's information and full freedom to interact with senior management. Details of the familiarization programs for Independent Directors are available on the Company's website https://www. tejasnetworks.com/policies-codes.php.

Directors/ Senior Management / Key Managerial Personnel Inductions/ Appointments

The following appointment were made

• Chetan Gupta appointed as Non-Executive and Non-independent Director of the Company, liable to retire by rotation by the Shareholders in their 18th Annual General Meeting held on July 24, 2018

• N R Ravikrishnan appointed as Company Secretary and Key Managerial Personnel and designated as General Counsel, Chief Compliance Officer and Company Secretary and a Key Managerial Personnel with effect from July 5, 2018.

• Chandrashekhar Bhaskar Bhave appointed as Independent (Additional/ Non-Executive) Director of the Company with effect from March 25, 2019. The Board recommends his appointment as Independent Director, not liable to retire by rotation, for a period of five (5) years with effect from March 25, 2019 till March 24, 2024, on terms and conditions which forms part of the Notice of the 19th Annual General Meeting.

• Arnob Roy appointed as Whole-time (Additional/ Executive) Director and designated as Chief Operating Officer of the Company with effect from March 25, 2019. The Board recommends his appointment as Whole-time and Executive Director liable to retire by rotation, under the designation of Chief Operating Officer for a period of five (5) years with effect from March 25, 2019 till March 24, 2024 on terms and conditions including remuneration which forms part of the Notice of the 19th Annual General Meeting.

Re-appointment

Sanjay Nayak, Managing Director and CEO, retires by rotation at the ensuing Annual General Meeting and being eligible, seeks re-appointment as Non-independent Director of the Company, liable to retire by rotation. Further, his tenure as Managing Director and CEO ends on December 31, 2019 and the Board has recommended his re-appointment as Managing Director and CEO for a further period of 5 years from January 1, 2020 till December 31, 2024 on terms and conditions including remuneration as set out in the Notice of the 19th Annual General Meeting.

Resignations

• Shirish Saraf vacated his office as Director of the Company by operation of law with effect from April 24, 2018.

• Chetan Gupta resigned as Non-Executive and Non-independent Director of the Company on personal grounds with effect from October 23, 2018.

• G V Krishnakanth resigned as Company Secretary and Compliance Officer and Key Managerial Personnel with effect from closing of business hours of July 4, 2018.

Constitution of the Senior Management

In line with the Listing Regulations, Regulation 16(1) (d) and with effect from March 25, 2019, the following shall comprise the Senior Managerial Personnel of the Company (one level below CEO)

• Arnob Roy, Whole-time Director and Chief Operating Officer and Key Managerial Personnel.

• Kumar N Sivarajan, Chief Technology Officer.

• Venkatesh Gadiyar, Chief Financial Officer and Key Managerial Personnel.

• Sukhvinder Kumar, President, Global Manufacturing Operations.

• Shirish Purohit, Head-Sales (India and Emerging Markets).

• Abhijat Mitra, Chief Human Resource Officer.

• N R Ravikrishnan, General Counsel, Chief Compliance Officer and Company Secretary and Key Managerial Personnel.

Other than the above, there were no changes to the Directors/ Senior Management/ Key Management Personnel during the year ended March 31, 2019.

Committees of the Board

The Company has the constituted the following five committees namely: the Audit Committee, the Nomination and Remuneration Committee, the Corporate Social Responsibility Committee, the Stakeholders Relationship Committee and Risk Management Committee. The composition, functions, scope, number of meetings held and attended by the members, etc., of each committee are furnished in the Corporate Governance Report which forms part of this Annual Report. There were no instances where the Board did not consider the recommendations made by the Audit Committee under Section 177(8) of Companies Act, 2013. Further the Company constituted the Risk Management Committee in its meeting held on January 23, 2019.

During the year under review, the Committee has amended and restated the Audit Committee Charter and the policy of the Nomination and Remuneration Committee and also adopted the Charters for the other committee of the Board. The Board has further amended and restated Code of Conduct under Securities and Exchange Board of India (Prohibition of Insider Trading) (Amendment) Regulations, 2018 and also amended and restated Code of Practices and Procedures for Fair Disclosures of Unpublished Price Sensitive Information in terms of Securities and Exchange Board of India (Prohibition of Insider Trading) (Amendment) Regulations, 2018. The Board in its meeting held on April 22, 2019 reconstituted the Committees of the Board.

Internal Financial controls

The Board has adopted policies and procedures for governance of orderly and efficient conduct of its business, including adherence to the Company's policies, safeguarding its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial disclosures. The Company's internal control systems commensurate with the nature of its business, the size and complexity of its operations.

The Company has adequate Internal Controls with proper checks and balances to ensure that transactions are properly authorized, recorded and reported apart from safeguarding its assets. These systems are reviewed and improved on a regular basis. It has a comprehensive budgetary control system to monitor revenue and expenditure against approved budgets on an ongoing basis; internal control systems which is commensurate with the nature of its business and the size and complexity of its operations. These are routinely tested and certified by Statutory Auditors as well as by the Internal Auditors and covers all offices, factories and key business areas. Significant audit observations and follow up actions thereon are reported to the Audit Committee. 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. Business Risk Assessment procedures have been set in place for self-assessment of business risks, operating controls and compliance with Corporate Policies. There is an ongoing process to track the evolution of risks and delivery of mitigating action plans.

The Company has robust systems for Internal Audit and Corporate risk assessment and mitigation. The Internal Audit covers all the factories, sales offices, warehouses and centrally controlled businesses and functions, as per the annual plan agreed with the Audit Committee. The audit coverage plan is approved by the Audit Committee at the beginning of every year. Every quarter, the Audit Committee is presented with key control issues and actions taken on the issues highlighted in previous report.

The Company's has appointed an independent auditor M/s. Singhvi, Dev and Unni, Chartered Accountants as Internal Auditors to reviews the controls across the key processes and submits report periodically to the Management and significant observations are also presented to the Audit Committee for review. There is also a follow up mechanism to monitor implementation of the various recommendations.

The Company's internal financial control framework is commensurate with the size and operations of the business and is in line with requirements of the Companies Act, 2013. The Company's internal financial controls framework has laid down Standard Operating Procedures and policies to guide the operations of the business. Unit heads are responsible to ensure compliance with the policies and procedures laid down by the management. Robust and continuous internal monitoring mechanisms ensure timely identification of risks and issues. The Management, Statutory and Internal Auditors undertake rigorous testing of the control environment of the Company. The Internal Auditors have submitted a summary report to the Audit Committee confirming the completeness and effectiveness of key controls tested on a quarterly and annual frequency. Further, significant processes were reviewed during the year and the process documentations have been accordingly updated, where necessary.

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by the management and the relevant Board committees, including the audit committee, the Board is of the opinion that the Company's internal financial controls were adequate and operating effectively during the FY 2018-19.

Vigil Mechanism / Whistle Blower Mechanism In line with the provisions of Section 177(9) of the Act read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the SEBI Listing Regulations, the Company has established a Whistle Blower / Vigil Mechanism through which its Directors, Employees and Stakeholders can report their genuine concerns about unethical behaviors, actual or suspected fraud or violation of the Company's code of conduct or ethics policy. The said mechanism provides for adequate safeguards against victimization and also direct access to the higher levels of supervisors. No person has been denied access to the Audit Committee and in appropriate and exceptional cases, concerns may be raised directly to the Chairperson of the Audit Committee. The Company hereby affirms that no Director/employee has been denied access to the Chairman of the Audit Committee and that no complaint has been received during the financial year 2018-19. The Vigil Mechanism Policy is available on the website of the Company at http://website.tejasnetworks.com/policies-codes.php

Initial Public Offer (IPO)

The Company made an initial public offer of 3,02,21,332 equity shares of Rs 107- each for a cash price of Rs 257/- per share including a premium of Rs 247/ per share aggregating to Rs 776.69 crore, comprising of a fresh issue of 1,75,09,727 equity shares aggregating to Rs 450 crore and an offer for sale of 1,27,11,605 equity by the selling Shareholders aggregating to Rs 326.69 crore during FY 2018.

The Company has fully utilized the amount as stated in the offer document/ prospectus and the purpose for which these proceeds were raised have been achieved and that there is no pending utilization of amount as of March 31, 2019. Further, the Board hereby confirms that there has been no deviation in the use of IPO Proceeds from the objects stated in the offer document/ prospectus dated June 21, 2017. The details of the utilization of the IPO proceeds forms part of the Notes of Accounts (Refer Note No. 35 of standalone financials).

Significant or Material Orders passed by Regulators or Courts or Tribunal

There are no significant orders passed by any Regulator or Court or Tribunal which can have impact on the going concern status and the Company's operations in future.

Investor Education and Protection Fund (IEPF) In accordance with the provisions of Sections 124, 125 and other applicable provisions, if any, of the Companies Act, 2013, read with the Investor Education Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (hereinafter referred to as IEPF Rules) (including any statutory modification(s) or re-enactment(s) thereof for the time being in force), the amount of dividend remaining unclaimed or unpaid for a period of seven years from the date of transfer to the unpaid dividend account is required to be transferred to the IEPF, maintained by the Central Government. In accordance with Section 124(6) of the Act, read with the IEPF Rules, all the shares in respect of which dividend has remained unclaimed or unpaid for seven consecutive years or more are required to be transferred to the demat Account of the IEPF Authority. Considering the fact that the Company has not declared any dividend till date, the matter of transferring the unpaid dividend nor the shares in respect of which the dividend were unclaimed by the respective allotees, to IEPF do not arise.

Auditors qualifications, reservations or adverse remarks or disclaimer made

During the year under review, there are no qualifications, reservations or adverse remarks made by the statutory auditors internal auditors or the secretarial auditors in their report. Further, no instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in the Board's report are reported by the statutory auditors, internal auditors or the secretarial auditors, to the audit committee under Section 143(12) of the Companies Act, 2013.

Annual Return

The extract of Annual Return in Form No. MGT-9 as required under Section 134(3)(a) of the Companies Act, 2013 for the financial year ending March 31, 2019 is annexed hereto as 'Annexure 3' and forms part of this report. A copy of the Annual Return has also been placed on the website of the Company at https://www. tejasnetworks.com/disclosures.php

Secretarial Standards

Your Directors confirm that the Secretarial Standards issued by the Institute of Companies Secretaries of India, as applicable to the Company and which are mandatory in nature, have been duly complied with. The Secretarial Auditor's Report issued for the year ended March 31, 2019 also confirms the same.

Stock Exchanges / Depositories

The Company's equity shares are listed in the National Stock Exchange of India Limited (Scrip Code No: TEJASNET) and BSE Limited (Scrip Code No: 540595). The Listing Fees for the fiscal 2020 are already paid to the stock exchanges. During the year under review, the Company has listed its Tejas Restricted Stock Unit Plan 2017 in the NSE/BSE consequent to exercise of RSU units by the employees of the Company into equity shares. Further the custodial fees for the year ended March 31, 2019 are already paid to National Securities Depositories Limited (NSDL) and Central Depositories Securities Limited (CDSL).

Directors' Responsibility Statement

The financial statements are prepared in accordance with Ind AS under the historical cost convention on accrual basis except for certain financial instruments, which are measured at fair values, according to the provisions of the Act (to the extent notified). The Ind AS are prescribed under Section 133 of the Companies Act, 2013 ('the Act'), read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016 and Companies (Indian Accounting Standards) Amendment Rules, 2018.

The Company has adopted all the Ind AS standards and the adoption was carried out in accordance with applicable transition guidance. Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

Pursuant to the provisions contained in Section 134(3) of the Companies Act, 2013, the Board of Directors to the best of their knowledge and belief and according to information and explanations obtained from the management, confirm that:

• In the preparation of the annual accounts for the financial year ended March 31, 2019, the applicable accounting standards had been followed and there are no material departures;

• 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 at the end of the financial year and of the profit and loss of the Company for that period;

• 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;

• The Directors had prepared the annual accounts on a going concern basis;

• The Directors, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

• 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.

5. Auditors and Audit Reports

Auditors

a. Statutory Auditors

The Members in their 17th Annual General Meeting held on September 27, 2017 approved the appointment of M/s. Price Waterhouse Chartered Accountants LLP (Firm registration number No. 012754N/N500016) as the Statutory Auditors of the Company for a period of five consecutive years from the conclusion of the 17th Annual General Meeting of the Company, till the conclusion of the 22nd Annual General Meeting, subject to ratification of the said appointment at every annual general meeting. However, the Ministry of Corporate Affairs (MCA) vide its notification dated 7 May 2018 has omitted the requirement under first proviso to Section 139 of the Companies Act, 2013 and rule 3(7) of the Companies (Audit and Auditors) Rules, 2014, regarding ratification of appointment of statutory auditors by Shareholders at every subsequent Annual General Meeting. Consequently, M/s. Price Waterhouse Chartered Accountants LLP (Firm registration number No. 012754N/N500016), continues to be the Statutory Auditors of the Company till the conclusion of 22nd Annual General Meeting, as approved by Shareholders at 17th Annual General Meeting held on September 27, 2017.

M/s. Price Waterhouse Chartered Accountants LLP (Firm registration number No. 012754N/N500016) has furnished a certificate of their eligibility and consent under Section 139 and 141 of the Act and the Companies (Audit and Auditors) Rules 2014 for their continuance as the Auditors of the Company for the FY 2019-20. In terms of the Listing Regulations, the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

The remuneration in the form of fees paid for the year ended March 31, 2019 to M/s. Price Waterhouse Chartered Accountants LLP (Firm registration number No. 012754N/N500016) as the statutory auditors of the Company are as follows.

in Rs crore

Note: The above fees exclude GST and out of pocket expenses.

c. 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 Board based on the recommendations of the Audit Committee has appointed Dwarakanath C, Practicing Company Secretary (PCS No. 7723 and

Engagement

Charged during the year

Statutory audit including limited reviews

0.45

Other audit related services

0.18

Total

0.63

Note : The above fees exclude GST and out of pocket expenses and do not include any element of contingent fees.

b. Internal Auditors

The Board based on the recommendations of the Audit Committee has appointed an Independent auditors M/s. Singhvi, Dev and Unni, Chartered Accountants as Internal Auditors of the Company for the fiscal 2020 to carry out the internal audit functions. The remuneration in the form of fees paid for the year ended March 31, 2019 to M/s. Singhvi, Dev and Unni, Chartered Accountants as Internal Auditors of the Company are as follows.

in Rs crore

Engagement

Charged during the year

Audit fees

0.25

Other audit related services

0.02

Total

0.27

Certificate of Practice No. 4847) as the Secretarial Auditor of the Company to conduct Secretarial Audit for fiscal 2020. The remuneration in the form of fees paid for the year ended March 31, 2019 to Dwarakanath C, Practicing Company Secretary as the Secretarial Auditor of the Company are as follows.

in Rs crore

Engagement

Charged during the year

Audit fees

Other audit related services

Total

Note: The above fees exclude GST.

d. Cost Auditors

The rules governing maintenance of cost accounting records and cost audit under section 148 of Companies Act, 2013, read with the Companies (Cost Records and Audit) Rules 2014, amended till date are not applicable to the Company. Hence the Company has not appointed the Cost Auditor.

Auditor's reports

• The Audit Report of M/s. Price Waterhouse Chartered Accountants LLP (Firm registration number No. 012754N/ N500016 - Statutory Auditors') for the year ended March 31, 2019 does not contain any qualification, reservation or adverse remark. The Statutory Auditors' Report is enclosed with the financial statements in this Annual Report.

• The Secretarial Audit Report of Dwarakanath C, Practicing Company Secretary (PCS No. 7723 and Certificate of Practice No. 4847 - the Secretarial Auditors) for the year ended March 31, 2019 does not contain any qualification, reservation or adverse remark The Secretarial Auditor's Report for the year ended March 31, 2019 is enclosed as 'Annexure 5' to the Annual Report.

• The Corporate Governance Report of Dwarakanath C, Practicing Company Secretary (PCS No. 7723 and Certificate of Practice No. 4847) for the year ended March 31, 2019, is enclosed. The Corporate Governance report states that the Company has complied with the stipulations of Corporate Governance as stipulated in Regulation 17 to 27 and clauses (b) to (i) of Regulation 46(2) and paras C and D of Schedule V of the Listing Regulations during the year ended March 31, 2019. The Corporate Governance certificate is enclosed in this Annual Report under Corporate Governance Report.

• The Certificate of Non-disqualification of Directors pursuant to Regulation 34(3) and Schedule V para C Clause (10)(i) of the Listing Regulation is enclosed in this Annual Report under Corporate Governance Report.

• The Auditors Certificate under SEBI (Share Based Employee Benefits) Regulations 2014 stating that the Company Employee share based benefit schemes has been implemented in accordance with the said regulations. The said certificate is hosted in the website https://www.tejasnetworks.com/ disclosures.php.

Key Audit Matter

In accordance with recent amendments to the Auditing Standards SA 701, the Statutory Auditors of the Company are expected to include the Key Audit Matter in their Audit Report. The Key Audit Matters are those matters which in the opinion of the Statutory Auditors of the Company were of most significance in the Audit of the Standalone / Consolidated Ind AS financial statements for the year ended March 31, 2019 and these matters were addressed in the context of the audit of the Standalone / Consolidated Ind AS financial statements for the year ended March 31, 2019 as a whole. The Key Audit Matter forms part of the Audit report of Standalone / Consolidated Ind AS financial statements.

6. Corporate Social Responsibility

Tejas works towards removing malnutrition, improving healthcare infrastructure, supporting primary education, rehabilitating abandoned women and children, and preserving Indian art and culture. The Company's focus has always been to contribute to the sustainable development of the society and environment, and to make our planet a better place for future generations. During the financial year ended March 31, 2019, the Company spent an amount of Rs 0.98 crore towards CSR activities, which constitutes 2% of the average net profits of the Company for the preceding three financial years.

In pursuance of the CSR Policy, the Company aims to support projects that promote education and therefore contributed to

(i) The Akshaya Patra Foundation which provides mid-day meals as an attempt to feed the millions of children in India and give them the motivation and nourishment they need to pursue an education and a better future. During the year we have contributed Rs 0.25 crore.

(ii) International Institute of Information Technology, Bengaluru, a Deemed University, popularly known as IIITB, established with a vision to contribute to the IT world by focusing on education and research, entrepreneurship and innovation. The Institute is a registered not-for-profit society funded jointly by the Government of Karnataka and the IT industry. During the year we have contributed Rs 0.25 crore.

(iii) Vinoba Sewa Ashram, Shahjahanpur, Uttar Pradesh. A Grass root Level Organization motivated by Sarvodaya thoughts by serving the rural people since 1980 on Education, Health, Income Generation and Animal Welfare. The Company contributed towards improving school infrastructure of existing government schools in Ghazipur, Uttar Pradesh. During the year we have contributed Rs 0.18 crore.

(iv) The Aurobindo Society, Puducherry - Project Inclusion aims to bring children with hidden disability who are unable to cope-up with the world around by giving them equal and quality education and aims to bring such children in forefront and makes inclusive education a reality. Through Project Inclusion, regular school teachers are trained to identify such students and provide them with right kind of training and education. The Project Inclusion operates in states such as Uttar Pradesh, Jharkhand, Chhattisgarh, Uttarakhand, Puducherry, Bihar, Sikkim, Punjab. During the year we have contributed Rs 0.30 crore.

The CSR policy and initiatives taken by the Company on Corporate Social Responsibility during the year are available on the Company's website http://www.tejasnetworks.com/policies-codes.php. The Annual Report on the CSR activities in the format prescribed under Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014, is set out in 'Annexure 6' to this Report.

7. Conservation of energy, research and development, technology absorption, foreign exchange earnings and outgo

The particulars relating to conservation of energy, technology absorption, research and development, foreign exchange earnings and outgo as required to be disclosed under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are given in 'Annexure 4' to this Report.

8. Business Responsibility Report (BRR)

Business Responsibility Report as stipulated under Regulation 34(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, describing the initiatives taken by your Company from an environmental, social and governance perspective, forms part of this Report and annexed herewith.

According to Regulation 34(2) of the Listing Regulations the disclosure on Business Responsibility Report shall be applicable to top 500 listed entities determined on the basis of market capitalization. As our Company is not in the top 500 listed entities for the year ended March 31, 2019, the disclosure on Business Responsibility Report is not applicable. However, the Company is voluntarily disclosing the same and the BRR forms part of the Annual Report. The BRR is hosted in the website https://www. tejasnetworks.com/disclosures.php.

9. Green initiatives

Electronic copies of the Annual report for the year 2019 and the Notice of the 19th Annual General Meeting are sent to all Shareholders whose email addresses are registered with the Company/ depository participant (s). For Members who have not registered their email addresses, physical copies are sent in the permitted mode. To support the Green Initiative, Members who have not registered their email addresses are requested to register the same with their DPs in case the shares are held by them in electronic form and with RTA in case the shares are held by them in physical form.

10. Cautionary Note

Certain statements in respect to Management Discussion and Analysis may be forward looking and are stated as required by the applicable laws and regulations. The future results of the Company may be affected by many factors, which could be different from what the Directors envisage in terms of future performance and outlook.

11. Acknowledgement

We thank our customers, vendors, investors, bankers, financial institution, employees and all other stakeholders for their continued support during the year. We place on record our appreciation of the contribution made by our employees at all levels. Our consistent growth was made possible by their hard work, solidarity, cooperation and support.

We also thank the government of various countries where we operate. We thank the Government of India particularly the Ministry of Labour and employment, the Ministry of Communications, the Ministry of Science and Technology, the Ministry of Electronics and Information Technology, the Ministry of Commerce and Industry, the Ministry of Finance, the Ministry of Corporate Affairs, the Central Board of Direct Taxes, the Central Board of Indirect Taxes and Customs, the Reserve Bank of India (RBI), the Securities Exchange Board of India (SEBI), the various departments under the state government and union territories and other government agencies for their support and look forward to their continued support in the future.

 

For and on behalf of the Board of Directors

 

Bengaluru

Sd/-

Sd/-

 

Balakrishnan V

Sanjay Nayak

 

April 22, 2019

 

Chairman

Managing Director and CEO

 

 

 

DIN No: 02825465

DIN No: 01049871

 

Annexure - 1

FORM NO. AOC -1

(Pursuant to First proviso to sub-section (3) of section 129 of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014) Statement containing salient features of the financial statement of subsidiaries I associate companies /joint ventures

Part A: Subsidiaries

(in Rs crore except % of shareholding)

Notes:

1. The annual accounts of the Subsidiary Companies and the related detailed information is made available on the website at https://www.tejasnetworks.com/financial-information-subsidiaries.php

2. Details of reporting currency and the rate used in the preparation of consolidated financial statements.

3. Names of subsidiaries which are yet to commence operations: Tejas Communications (Nigeria) Limited (a subsidiary of Tejas Communication Pte Ltd) is yet to commence its operations.

4. Names of subsidiaries which have been liquidated or sold during the year:

a) Tejas Israel Limited, a wholly owned non-operating foreign subsidiary has been liquidated with effect from November 25, 2018 pursuant to receiving approval from the Registrar of Companies and Partnerships, Israel.

b) vSave Energy Private Limited, a wholly owned non-operating Indian subsidiary has been dissolved with effect from July 28, 2018 pursuant to receiving approval from the Registrar of Companies, Karnataka for dissolution, and striking off the name of this entity.

 Part B: Associates and Joint Ventures

The Company does not have any Associate or Joint Ventures Companies

 

 

For and on behalf of the Board of Directors

 

 

Sd/-

Sd/-

 

 

Balakrishnan V

Sanjay Nayak

 

 

Chairman

CEO and Managing Director

 

 

(DIN:02825465)

(DIN:01049871)

 

Bengaluru

Sd/-

Sd/-

 

April 22, 2019

 

Venkatesh Gadiyar

N R Ravikrishnan

 

 

Chief Financial Officer

General Counsel, Chief Compliance Officer and Company Secretary

 

 

Name of the Subsidiary

Financial Period ended

Reporting currency

Share Capital

Reserves & Surplus

Total Assets

Liabilities

Investments

Turnover

Profit/

(loss)

before Taxation

Provision Taxation

Profit/

(loss) after Taxation

Proposed Dividend

% of share

holding

Tejas Communication Pte Ltd. Singapore

March 31, 2019

USD

14.22

(0.14)

18.92

5.07

0.23

18.03

0.43

-

0.43

-

100%

Tejas Israel Limited (Refer Note 4a)

March 31,2019

USD

NA

NA

NA

NA

-

-

0.25

-

0.25

-

100%

vSave Energy Private Limited (Refer Note 4b)

March 31,2019

INR

NA

NA

-

-

-

-

-

-

-

-

100%

 

Reporting Currency Reference

For Conversion

Currency

Average Rate

(in Rs)

Closing Rate (in Rs)

Tejas Communication Pte Ltd.

USD

69.90

69.16

Tejas Israel Limited

USD

69.90

69.16

Annexure — 2

FORM NO. AOC -2

(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014)

Form for disclosure of particulars of contracts/arrangements entered into by the Company with related parties referred to in sub section (1) of section 188 of the Companies Act, 2013 including certain arm's length transaction under third proviso thereto.

1. Details of contracts or arrangements or transactions not at arm's length basis

There were no contracts or arrangements or transactions entered into during the year ended March 31, 2019, which were not at arm's length basis.

2. Details of material contracts or arrangements or transactions at arm's length basis

The details of material contracts or arrangements or transactions at arm's length basis for the year ended March 31, 2019 are as follows:

(in Rs crore)

Name of related party

Nature of relationship

Nature of contracts /arrangements /transactions

Duration of the contracts /arrangements /transactions

Salient terms1

Amount

 

 

Sale of Goods

Ongoing

Based on transfer pricing guidelines

9.39

Tejas Communication Pte. Limited

Wholly-owned subsidiary

Rendering of Services

Ongoing

Based on transfer pricing guidelines

2.34

 

 

Reimbursement of expenses

Ongoing

Based on transfer pricing guidelines

10.20

Clonect Solutions Private Limited

Entity where a Director is interested

Professional charges

Ongoing

Service Agreement

0.08

Darwinbox Digital Solutions Private Limited

Entity where a Director is interested

Professional charges

Ongoing

Service Agreement

0.06

'Appropriate approvals have been taken for related party transactions.

For and on behalf of the Board of Directors

Sd/-

Sd/-

Balakrishnan V

Sanjay Nayak.

Chairman

Managing Director and CEO

DIN No: 02825465

DIN No: 01049871

 

Bengaluru

April 22, 2019

Annexure — 3

Form No. MGT-9

Extract of annual return as on the financial year ended on March 31, 2019.

[Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014]

I. Registration and Other Details:

i

CIN

L72900KA2000PLC026980

ii

Registration Date

24 April, 2000

iii

Name of the Company

Tejas Networks Limited

iv

Category / Sub-Category of the Company

Company limited by Shares/Non-government company

V

Address of the Registered office and contact details

J P Software Park, Plot No 25, Sy No 13, 14,17,18 Konnapana

Agrahara Village, Begur Hobli Bengaluru- 560100, Karnataka

Tel: 080 41794600

Fax: 080 2852 0201

Email id: corporate@tejasnetworks.com

Website: www.tejasnetworks.com

vi

Whether listed company

Yes /No

vii

Name, Address and Contact details of Registrar and Transfer Agent, if any

Link Intime India Private Limited

C- 101, 1st Floor, 247 Park, Lai Bahadur Shastri Marg, Vikhroli

(West) Mumbai, 400083.

Tel: +9 122 49186200

Fax: +91 22 4918 6195

E-mail: rnt.helpdesk@linkintime.co.in

Website: www.linkintime.co.in

II. Principal Business Activities of The Company

All the business activities contributing 10 % or more of the total turnover of the Company shall be stated:-

Name and Description of main products/services

NIC Code of the Product/service

% to total turnover of the Company

1

Manufacture of Communication equipment

263

100

III. Particulars of Holding, Subsidiary and Associate Companies

All the business activities contributing 10 % or more of the total turnover of the Company shall be stated:-

Name of the parties

Country

CIN/GLN

Holding/Subsidiary /Associate

% of shares held as at March 31, 2019

Tejas Communication Pte Ltd. (TCPL)

Singapore

NA

Subsidiary

100%

Tejas Communications (Nigeria) Limited

Nigeria

NA

Subsidiary of TCPL

100%

vSave Energy Private Limited1

India

U32201KA2013PTC071695

Subsidiary

-

Tejas Israel Limited2

Israel

NA

Subsidiary

-

Note: All the above subsidiaries are as per Section 2(87) of Companies Act, 2013.

'vSave Energy Private Limited has been dissolved with effect from July 28, 2018 pursuant to receiving approval from the Registrar of Companies, Karnataka for dissolution and striking off the name of the Company under Section 248 of the Companies Act, 2013.

2Tejas Israel Limited has been liquidated with effect from November 25, 2018 pursuant to receiving approval from the Registrar of Companies and Partnerships, Israel.

IV. Shareholding Pattern (Equity share capital breakup as percentage of total equity)

i. Category-Wise Share Holding

Category of Shareholders

No. of Shares held at the beginning of the year

No. of Shares held at the end of the year

% Change during the year

Denial

Physical

Tolal

% of Tolal Shares

Denial

Physical

Tolal

% of Tolal Shares

A. Promoter

 

 

 

 

 

 

 

 

 

1) Indian

 

 

 

 

 

 

 

 

 

a) Individual/ HUF

-

-

-

-

-

-

-

-

-

b) Central Govt

-

-

-

-

-

-

-

-

-

c) State Govt(s)

-

-

-

-

-

-

-

-

-

d) Bodies Corp

-

-

-

-

-

-

-

-

-

e) Banks / FI

-

-

-

-

-

-

-

-

-

f) Any Other (Company and Trust)

-

-

-

-

-

-

-

-

-

Sub-total (A) (1):-

-

-

-

-

-

-

-

-

-

2) Foreign

 

 

 

 

 

 

 

 

 

g) NRIs-Individuals

-

-

-

-

-

-

-

-

-

h) Other-Individuals

-

 

 

 

 

 

 

 

-

i) Bodies Corp.

-

-

-

-

-

-

-

-

-

j) Banks / FI

-

-

-

-

-

-

-

-

-

k) Any Other

-

-

-

-

-

-

-

-

-

Sub-total (A) (2):-

-

-

-

-

-

-

-

-

-

Total Promoter Shareholding (A)=(A)(1)+ (A) (2)

-

-

-

-

-

-

-

-

-

B. Public Shareholding

 

 

 

 

 

 

 

 

 

1. Institutions

 

 

 

 

 

 

 

 

 

a) Mutual Funds

69,58,379

-

69,58,379

7.66

1,09,00,590

-

1,09,00,590

11.88

4.22

b) Banks / FI

3,30,608

-

3,30,608 0.36

45,797

-

45,797

0.05

(0.31)

c) Central Govt

-

-

-

-

-

-

-

-

-

d) State Govt(s)

-

-

-

-

-

-

-

-

-

e) Venture Capital Funds

-

-

-

-

-

-

-

-

-

f) Insurance Companies

-

-

-

-

-

-

-

-

-

g) Foreign institutional Investors/ Foreign Portfolio Investors

1,53,58,124

-

1,53,58,124

16.91

2,29,85,120

-

2,29,85,120

25.06

8.15

h) Foreign Venture Capital Funds

 

 

 

 

-

-

-

-

 

i) Others -specify

 

 

 

 

 

 

 

 

 

• Foreign PE and Trusts

-

 

 

 

-

-

-

-

 

• Alternate Investment Fund

23,38,579

-

23,38,579

2.57

4,32,613

4,32,613

0.47

(2.10)

 

Sub-total (B)(l)

2,49,85,690

-

2,49,85,690

27.50

3,43,64,120

-

3,43,64,120

37.46

 

2. Non Institutions

 

 

 

 

 

 

 

 

 

a) Bodies Corp.

1,79,55,721

-

1,79,55,721

19.78

34,37,180

34,37,180

3.75

(16.03)

 

b) Individuals

 

 

 

 

 

 

 

 

 

(i) Individual Shareholders holding nominal share capital upto Rs 1 lakh

34,85,268

3,44,894

38,30,162

4.22

36,73,977

1,87,153

38,61,130

4.21

(0.01)

(ii) Individual Shareholders holding nominal share capital in excess of Rs 1 lakh

21,53,713

1,38,900

22,92,613

2.52

24,55,937

78,299

25,34,236

2.76

0.24

c) Others(Specify)

-

-

-

-

-

-

-

-

-

• Trust

87,606

96,379

1,83,985

0.20

2

96,379

96,381

0.11

(0.09)

• HUF

1,36,380

1,36,380

0.15

1,55,219

1,55,219

0.17

0.02

 

 

• NRI

2,16,462

-

2,16,462

0.24

3,73,506

28,800

4,02,306

0.44

0.20

• Foreign Companies

3,03,24,651

8,01,021

3,11,25,672

34.27

3,66,51,261

3,53,550

3,70,04,811

40.35

6.08

• Clearing members

2,05,507

-

2,05,507

0.23

1,58,248

-

1,58,248

0.17

(0.06)

• Director or Director's Relatives

25,48,124

25,48,124

2.81

33,54,324

-

33,54,324

3.65

0.84

 

• Employees

71,58,100

1,80,344

73,38,444

8.08

63,07,862

585

63,08,447

6.88

(1.20)

• NBFC registered with RBI

-

-

-

-

41,972

-

41,972

0.05

0.05

• Foreign National

-

-

-

-

1,205

-

1,205

0.00

0.00

Sub-total (B)(2)

6,42,71,532

15,61,538

6,58,33,070

72.50

5,66,10,693

7,44,766

5,73,55,459

62.54

 

B. Total Public Shareholding (B)=(B)(1)+ (B)(2)

8,92,57,222

15,61,538

9,08,18,760

100.00

9,09,74,813

7,44,766

9,17,19,579

100.00

 

C. Shares held by Custodian for GDRs & ADRs

-

-

-

-

-

-

-

-

-

Grand Total (A+B+C)

8,92,57,222

15,61,538

9,08,18,760

100.00

9,09,74,813

7,44,766

9,17,19,579

100.00

 

 

ii. Shareholding of Promoters / Promoter group: Not Applicable since the Company is a professionally managed company and does not have an identifiable promoter either in terms of the SEBI ICDR Regulations or the Companies Act, 2013.

iii. Change in Promoters' Shareholding ( please specify, if there is no change): Not Applicable

iv. Shareholding Pattern of top ten Shareholders as of March 31, 2019 (Other than Directors, Promoters and Holders of GDRs and ADRs)

SL No

Name of The Shareholder

Shareholding at the beginning of the year

Cumulative Shareholding during the year

No. of shares

% of total shares of the Company'1'

No. of shares

% of total shares of the Company'

1

Cascade Capital Management Mauritius

 

 

 

 

 

At the beginning of the year

1,65,13,184

18.18

1,65,13,184

18.00

 

Purchase(s) during the year

-

-

1,65,13,184

18.00

 

Sale(s) during the year

-

-

1,65,13,184

18.00

 

At the end of the year

-

-

1,65,13,184

18.00

2

Samena Spectrum Co

 

 

 

 

 

At the beginning of the year

1,39,81,648

15.40

1,39,81,648

15.24

 

Purchase(s) during the year

-

-

1,39,81,648

15.24

 

Sale(s) during the year

(45,39,999)

5.00

94,41,649

10.29

 

At the end of the year

-

-

94,41,649

10.29

3

Mayfield XII, Mauritius

 

 

 

 

 

At the beginning of the year

71,06,628

7.83

71,06,628

7.75

 

Purchase(s) during the year

-

-

71,06,628

7.75

 

Sale(s) during the year

-

-

71,06,628

7.75

 

At the end of the year

-

-

71,06,628

7.75

4

Reliance Capital Trustee Co. Ltd

 

 

 

 

 

At the beginning of the year

49,63,187

5.46

49,63,187

5.41

 

Purchase(s) during the year

8,54,567

0.94

58,17,754

6.34

 

Sale(s) during the year

-

-

58,17,754

6.34

 

At the end of the year

-

-

58,17,754

6.34

5

Aditya Birla Sun Life Trustee Private Limited

 

 

 

 

 

At the beginning of the year

4,17,939

0.46

4,17,939

0.46

 

Purchase(s) during the year

35,45,582

3.90

39,63,521

4.32

 

Sale(s) / Transfer(s) during the year

-

-

39,63,521

4.32

 

At the end of the year

-

-

39,63,521

4.32

6

East Bridge Capital Master Fund I Limited

 

 

 

 

 

At the beginning of the year

-

-

-

-

 

Purchase(s) during the year

37,93,508

4.18

37,93,508

4.14

 

Sale(s) during the year

-

-

37,93,508

4.14

 

At the end of the year

-

-

37,93,508

4.14

7

East Bridge Capital Master Fund Limited

 

 

 

 

 

At the beginning of the year

35,99,997

3.96

35,99,997

3.93

 

Purchase(s) during the year

-

-

35,99,997

3.93

 

Sale(s) during the year

-

-

35,99,997

3.93

 

At the end of the year

-

-

35,99,997

3.93

8

Sandstone Private Investments

 

 

 

 

 

At the beginning of the year

35,89,800

3.95

35,89,800

3.91

 

Purchase(s) during the year

-

-

35,89,800

3.91

 

Sale(s) during the year

-

-

35,89,800

3.91

 

At the end of the year

-

-

35,89,800

3.91

9

Columbia Emerging Markets Fund

 

 

 

 

 

At the beginning of the year

19,03,604

2.10

19,03,604

2.08

 

Purchase(s) during the year

-

-

19,03,604

2.08

 

Sale(s) during the year

-

-

19,03,604

2.08

 

At the end of the year

-

-

19,03,604

2.08

10

Abu Dhabi Investment Authority - Behave

 

 

 

 

 

At the beginning of the year

18,66,855

2.06

18,66,855

2.04

 

Purchase(s) during the year

-

-

18,66,855

2.04

 

Sale(s) during the year

-

-

18,66,855

2.04

 

At the end of the year

-

-

18,66,855

2.04

'''Percentage calculated on the paid-up share capital (9,08,18,760 shares) as at the beginning of the year (2'Percentage calculated on the paid-up share capital (9,17,19,579 shares) as at the end of the year

v. Shareholding of Directors and Key Managerial Personnel

SL No

Name of the Director/KMP

Shareholding at the beginning of the year

Cumulative Shareholding during the year

No. of shares

% of total shares of the CompanV D

No. of shares

% of total shares of the Company'

1

Sanjay Nayak

 

 

 

 

 

At the beginning of the year

24,71,991

2.72

24,71,991

2.70

 

ESOP's / RSU's exercised during the year

35,000

0.04

25,06,991

2.73

 

Purchase (s) during the year

7,000

0.01

25,13,991

2.74

 

Sale(s) during the year

-

-

25,13,991

2.74

L

At the end of the year

 

 

25,13,991

2.74

2

Balakrishnan V

 

 

 

 

 

At the beginning of the year

76,133

0.08

76,133

0.08

 

ESOP's / RSU's exercised during the year

-

-

76,133

0.08

 

Purchase (s) during the year

1,00,000

0.11

1,76,133

0.19

 

Sale(s) during the year

-

-

1,76,133

0.19

 

At the end of the year

 

 

1,76,133

0.19

3

Arnob Roy

 

 

 

 

 

At the beginning of the year

6,64,200

0.73

6,64,200

0.72

 

ESOP's / RSU's exercised during the year

-

-

6,64,200

0.72

 

Purchase (s) during the year

-

-

6,64,200

0.72

 

Sale(s) during the year

-

-

6,64,200

0.72

 

At the end of the year

 

 

6,64,200

0.72

4

Venkatesh Gadiyar

 

 

 

 

 

At the beginning of the year

44,000

0.05

44,000

0.05

 

ESOP's / RSU's exercised during the year

1,01,875

0.11

1,45,875

0.16

 

Purchase (s) during the year

50,000

0.06

1,95,875

0.21

 

Sale(s) during the year

-

-

1,95,875

0.21

 

At the end of the year

-

-

1,95,875

0.21

5

N R Ravikrishnan

 

 

 

 

I

At the beginning of the year

-

-

-

-

 

ESOP's / RSU's exercised during the year

3,000

0.003

3,000

0.003

 

Purchase (s) during the year

-

-

3,000

0.003

 

Sale(s) during the year

-

-

3,000

0.003

 

At the end of the year

-

-

3,000

0.003

(1) Percentage calculated on the paid-up share capital (9,08,18,760 shares) as at the beginning of the year

(2) Percentage calculated on the paid-up share capital (9,17,19,579 shares) as at the end of the year

V. Indebtedness

Indebtedness of the Company including interest outstanding/accrued but not due for payment

Particulars

Secured Loans excluding deposits

Unsecured Loans

Deposits

Total Indebtedness

Indebtedness at the beginning of the financial year

 

 

 

 

i) Principal Amount

-

2.00

-

2.00

ii) Interest due but not paid

-

-

-

-

iii) Interest accrued but not due

-

0.27

-

0.27

Total (i+ii+iii)

-

2.27

-

2.27

Change in Indebtedness during the financial year - Addition

 

 

 

 

- Reduction

-

1.08

-

1.08

Net Change

-

(1.08)

-

(1.08)

Indebtedness at the end of the financial year

 

 

 

 

i) Principal Amount

-

1.00

-

1.00

ii) Interest due but not paid

-

-

-

-

iii) Interest accrued but not due

-

0.19

-

0.19

Total (i+ii+iii)

-

1.19

-

1.19

VI. Remuneration of Directors and Key Managerial Personnel

A. Remuneration to Managing Director, Whole-time Directors and/or Manager

in Rs crore

SI. No.

Particulars

CEO & Managing Director

COO & Whole-time Director

Sanjay Nayak

Arnob Roy*

 

(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961

1.67

1.16

1.

(b) Value ol perquisites u/s 17(2) Income-tax Act 1961

0.43

-

 

(c) Profits in lieu of salary under section 17(3) Income-tax Act, 1961

-

-

2.

Restricted Stock Units A (in No's)

55,000

48,000

3.

Sweat Equity

 

 

 

Commission

-

-

4.

- as % of profit

-

-

 

- others, specify

-

-

5.

Others, please specify

-

 

 

Total

2.10

1.16

The above table is based on actual payments made during the year

Total Remuneration includes fixed pay, performance linked variable pay, retiral benefits and the perquisite value of stock options/RSUs exercised during the period, which was granted during earlier years, determined in accordance with the provisions of the Income Tax Act, 1961. Accordingly the value of stock options/RSUs granted during the period is not included..

* Rs 0.03 crore is the total remuneration paid to Arnob Roy as Executive Director for the period from March 25, 2019 till March 31, 2019

A RSU granted during the year

B. Remuneration to other Directors:

in Rs crore

Particulars of Remuneration

Name of the Directors

Total

Chairman & Independent Director

Independent Director

Balakrishnan V

Amb. Leela K Ponappa

Independent Directors

 

 

 

Fee for attending Board / Committee meetings

0.06

0.05

0.11

Commission

0.25

0.13

0.38

Others, please specify

-

-

-

Total

0.31

0.18

0.49

• Dr. Gururaj Deshpande, Shirish Saral and Chetan Gupta being Non-independent and Non-Executive Director are not entitled for remuneration either in the form of sitting fees or commission for the fiscal 2019.

• Chandrashekhar Bhaskar Bhave being an Independent Director joined the Board with effect from March 25, 2019 and hence he is not entitled for remuneration for the fiscal 2019.

Total Managerial Remuneration for the fiscal 2019 is Rs 2.62 crore which is within the overall limit of 11% of net profits of the Company calculated as per section 198 of the Companies Act, 2013.

C. Remuneration to Key Managerial Personnel Other Than MD /Manager AVTD

 

in Rs crore

SI. No.

Particulars of Remuneration

CFO

Company Secretary & Compliance Officer

General Counsel, Chief Compliance Officer & Company Secretary

Venkatesh Gadiyar

Krishnakanth G V

N R Ravikrishnan

 

(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961

0.65

0.14

0.45

1.

(b) Value ol perquisites u/s 17(2) Income-tax Act, 1961

1.81

0.15

0.07

 

(c) Profits in lieu of salary under section 17(3) Income-tax Act, 1961

-

-

-

2.

Restricted Stock UnitsA (in No's)

32,000

-

10,000

3.

Sweat Equity

-

-

-

 

Commission

-

-

-

4.

- as % of profit

-

-

 

 

- others, specify

-

-

 

5.

Others, please specify

-

-

-

 

Total

2.46

0.29

0.52

Total Remuneration includes fixed pay, performance linked variable pay, retiral benefits and the perquisite value of stock options/RSUs exercised during the period, which was granted during earlier years, determined in accordance with the provisions of the Income Tax Act, 1961. Accordingly the value of stock options/RSUs granted during the period is not included.

A RSU granted during the year

Note:

• The remuneration of Krishnakanth G V is till the date of his resignation (July 4, 2018) as Company Secretary.

• N R Ravikrishnan was appointed as Company Secretary on July 5, 2018. The above mentioned remuneration includes Rs 0.38 crore as Company Secretary.

VII. Penalties / Punishment/ Compounding of Offences:

There were no Penalties / Punishment/ Compounding of Offences for breach of any section of Companies Act, 2013 against the Company or its Directors or other Officers in default, if any, during fiscal 2019.

• Multi-service micro-OTN switch for cost-effective metro capacity expansion; scalable 96-channel DWDM product with 100G/200G/400G alien wavelength support

• Advanced SDN-ready network management software that enables multi-technology provisioning and management of services across OTN, DWDM, PTN and Ethernet layers from a unified interface

ii. In case of imported technology (imported during the last three years reckoned from the beginning of the financial year)-

(a) the details of technology imported Nil

(b) the year of import; Nil

(c) whether the technology been fully absorbed Nil if not fully absorbed, areas where absorption has not taken place, and the reasons thereof

The Company continuously evaluates new technologies and invests for making infrastructure more energy efficient. The Company has identified thought leadership areas in knowledge management and collaborative commerce which will in turn help product enhancements and building collaborative commerce across various platforms.

(C) Research & Development (R&D)

The Board understands that the overall success of the Company lies in its R&D efforts. Therefore, continuous R&D investments will be made to enhance designs, hardware optimizations, new technology development and adoption, re-engineering, etc. in the areas that the Company is involved.

Expenditure on R&D for the year ended March 31, 2019 and March 31, 2018 towards development of the Company's products is as follows:

in Rs crore

Particulars

Standalone

2019

2018

Capital Expenditure

3.36

6.65

Revenue expenditure*

115.51

86.90

Total R&D expenditure

118.87

93.55

Total R&D expenditure/ Standalone Revenue net of taxes and components (%)

13.66%

12.75%

'A portion of the revenue expenditure amounting to Rs 62.43 (March 31, 2018: Rs 48.15) (Refer Note 23 of standalone financials) includes R&D manpower salaries/wages towards product development that has been capitalised in the books of accounts and has been shown as intangible assets under development in compliance with the relevant Indian Accounting Standards (Ind AS). In the previous year financial statements the aforesaid amount has been disclosed separately under eligible capital expenditure.

(D) Foreign Exchange earnings & outgo

 

in Rs crore

Particulars

Standalone

2019

2018

Foreign exchange earnings

123.69

203.15

Foreign exchange outgo

286.19

186.59

Annexure - 4

Information pursuant to Section 134 (3)(m) of the Companies Act. 2013 read with Rule 8(3) of the Companies (Accounts) Rules. 2014

Particulars of Energy Conservation, Research and Development, Technology absorption and Foreign exchange earnings and outgo required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014

(A) Conservation of Energy

(B) Technology Absorption

i. Tejas products are developed with high domestic value-addition through indigenous R&D, in-house IPR creation and local manufacturing. We have a strong commitment to R&D and over 50% of our employees are engaged in R&D activities. Today, all large private telecom operators, telecom PSUs and utilities use Tejas products in their pan-India networks in lieu of imported equipment from foreign multinational companies thereby realizing valuable foreign exchange savings for the country. Tejas is the leading domestic supplier of optical and data networking products for various government projects of national importance, having security/strategic implications such as Bharatnet, defence networks and smart cities. As one of the leading innovators in India's ICT sector, Tejas has generated 349 patents and 270+ semiconductor IPs that underpin our wide range of home-grown telecom products. In addition, Tejas is actively contributing to global 5G standards through its work in India's telecom standards organization (TSDSI) thereby ensuring that Indian requirements are effectively captured in all emerging telecom standards.

Tejas R&D team conceived, designed and developed the following leading-edge products in FY19:

• World's first ultra-converged broadband access/edge platform that integrates gigabit speed fiber broadband (FTTx), LTE-based fixed wireless access, Carrier Ethernet & packet transport functions in one platform

• High-capacity circuit emulation solutions for optical network modernization and legacy DACS (Digital Cross-connect) replacement applications

• Multi-terabit packet and OTN cross-connect with pay-as-you-grow scaling using a novel disaggregated leaf-and-spine architecture

The steps taken or impact on conservation of energy;

Upgraded CFL lights to LED lights and AC upgraded to inverter technology which will reduce consumption of energy.

The steps taken by the Company for utilizing alternate sources of energy;

No steps were undertaken by the Company for utilizing alternative sources of energy.

The capital investment on energy conservation equipment;

During year under review, the Company had not made any investment on the energy conservation equipment as the same were not warranted.

Annexure - 5

Secretarial Audit Report

For the financial year ended 31st March 2019

[Pursuant to Section 204(1) of the Companies Act, 2013 and Rule No. 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]

To

The Members

Tejas Networks Limited

(CIN L72900KA2000PLC026980)

J P Software Park, Plot No 25,

Sy. No.13,14,17,18 Konnapana Agrahara Village,

Begur Hobli, Bengaluru - 560100

I have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by Tejas Networks Limited (Company). Secretarial Audit was conducted in a manner that provided me a reasonable basis for evaluating the corporate conducts/ statutory compliances and expressing my opinion thereon.

Based on my verification of the Company's books, papers, minute books, forms and returns filed and other records maintained by the Company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, I hereby report that in my opinion, the Company has, during the audit period covering the financial year ended on 31st March 2019 (Audit Period), complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

I have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for Audit Period, according to the provisions of:

(i) The Companies Act, 2013 and the rules made thereunder (Act); (ii) The Securities Contracts (Regulation) Act, 1956 and the Rules made thereunder; (iii) The Depositories Act, 1996 and the regulations and bye-laws framed thereunder; (iv) Foreign Exchange Management Act, 1999 and the Rules and Regulations made thereunder (FEMA) to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings [The Company has not raised any External Commercial Borrowings during the Audit Period]; (v) The following regulations and guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (SEBI Act) :

a. Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015;

b. The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011; Bengaluru April 19, 2019

Note: This report is to be read with my letter of even date which is annexed as Annexure-2 hereto and forms an integral part of this report.

c. Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015;

d. Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018;

e. Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014;

f. The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008;

g. The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client;

h. The Securities and Exchange Board of India (Delisting of

Equity Shares) Regulations, 2009; i. Securities and Exchange Board of India (Buyback of Securities) Regulations, 2018 and

(vi) Other laws informed by the management of the Company as applicable to the Company is enclosed as Annexure-1 hereto.

Further, I have also examined compliance with the applicable clauses of the following:

(i) Secretarial Standards issued by The Institute of Company Secretaries of India with respect to Board and general meetings.

(ii) The Listing Agreements entered into by the Company with National Stock Exchange of India Limited and Bombay Stock Exchange Limited read with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. During the Audit Period, the Company has complied with the provisions of the Act, rules, regulations, guidelines, standards, etc., mentioned above.

I further report that:

- The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-Executive Directors and Independent Directors. The changes in the composition of the Board of Directors that took place during the Audit Period were carried out in compliance with the provisions of the Act.

- Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent atleast seven days in advance (and by complying with prescribed procedure where the meetings are called with less than seven days' notice), and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting.

- All decisions at the Board Meetings and Committee Meetings are carried out unanimously, as recorded in the minutes.

I further report that there are systems and processes in the Company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.

Sd/-

C. Dwarakanath

Company Secretary in Practice

PCS No: 7723; CP No: 4847

Annexure - 1 to Secretarial Audit Report

List of Other Laws Applicable

A. Corporate laws

1. The Depositories Act, 1996 and regulation and bye-laws thereunder

B. Labour laws

1. Shops & Commercial Establishments Act of applicable states;

2. Child Labour (Prohibition and Regulation) Act, 1986;

3. Sexual Harassment at Workplace (Prevention, Prohibition and Redressal) Act, 2013;

4. The Contract Labour (Regulation and Abolition) Act, 1970;

5. The Employees' Provident Fund and Miscellaneous Provisions Act, 1952;

6. The Employees' State Insurance Act, 1948;

7. The Employees Compensation Act, 1923;

8. The Equal Remuneration Act, 1976;

9. The Factories Act, 1948;

10. The Industrial Disputes Act, 1947;

11. The Industrial Employment (Standing Orders) Act, 1946;

12. The Maternity Benefit Act, 1961;

13. The Minimum Wages Act, 1948;

14. The Payment of Bonus Act, 1965;

15. The Payment of Gratuity Act, 1972;

16. The Payment of Wages Act, 1936; and

17. The Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959

C. Taxation laws

1. The Income Tax Act, 1961;

2. The Customs Act, 1961;

3. The Central Excise Act, 1944;

4. Karnataka Value Added Tax, 2005;

5. Service Tax under Chapter V of the Finance Act, 1994;

6. The Central Sales Tax Act, 1956;

7. The Karnataka Tax on Professions, Trades, Callings and Employment Act, 1976;

8. The West Bengal Tax on Entry of Goods into Local Areas Act, 2012;

9. The Maharashtra State Tax on Professions, Trades, Callings and Employments Act, 1975; and

10. The West Bengal State Tax on Professions, Trades, Calling and Employments Act, 1979

D. Intellectual property laws

1. The Patents Act, 1970; and

2. The Trade Marks Act, 1999

E. Environmental laws

1. The Water (Prevention and Control of Pollution) Act, 1974;

2. The Air (Prevention and Control of Pollution) Act, 1981;

3. The Environment Protection Act, 1986; and

4. The Water (Prevention & Control of Pollution) Cess Act, 1977 and Water (Prevention & Control of Pollution) Cess Rules, 1978

F. Laws & policies applicable to Telecommunication Sector

1. Notifications dated 10th February 2012 and 5th October 2012 of The Department of Information Technology, Ministry of Communications and Information Technology;

2. Electronic Hardware Technology Park Scheme;

3. Public Procurement Policy for Micro and Small Enterprises Order, 2012;

4. Karnataka Electronic System Design and Manufacturing Policy 2013;

5. Foreign Trade Policy 2015-2020;

6. Service Export from India Scheme;

7. Information Technology Act, 2000;

8. Telecom Regulatory Authority of India Act, 1997;

9. Indian Telegraph Act, 1885;

10. Indian Wireless Telegraphy Act, 1933; and

11. Telegraph Wires (Unlawful Possession) Act, 1950

G. Miscellaneous laws

1. The Prevention of Money Laundering Act, 2002;

2. The Micro, Small and Medium Enterprises Development Act, 2006; and

3. The Competition Act, 2002

Bengaluru

April 19, 2019

 

Sd/-

C. Dwarakanath

Company Secretary in Practice

PCS No: 7723; CP No: 4847

Annexure - 2 to Secretarial Audit Report

To

The Members

Tejas Networks Limited

(CIN L72900KA2000PLC026980)

J P Software Park, Plot No 25,

Sy. No.13,14,17,18 Konnapana Agrahara Village,

Begur Hobli, Bengaluru - 560100

My Secretarial Audit Report of even date is to be read along with this letter.

1. Maintenance ol secretarial records is the responsibility ol the management of the Company. My responsibility is to express an opinion on these secretarial records based on the audit.

2. I have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness of the contents of the secretarial records. The verification was done on random test basis to ensure that correct facts are reflected in the secretarial records. I believe that the processes and practices, I followed provide a reasonable basis for my opinion.

3. I have not verified the correctness and appropriateness of financial records and books of accounts of the Company.

4. The compliance of the provisions of corporate and other applicable laws, rules, regulations, standards etc., is the responsibility of the management of the Company. My examination was limited to the verification of procedures on random test basis.

5. Wherever required, I have obtained the management representation about the compliance of laws, rules and regulations and happening of events etc.

6. The list of laws applicable to the Company enclosed as Annexure-1 to the Secretarial Audit Report is as confirmed by the management of the Company. The Secretarial Audit Report is neither an assurance nor a confirmation that the list is exhaustive.

7. The Secretarial Audit Report is neither an assurance as to the future viability of the Company nor of the efficacy or effectiveness with which the management has conducted the affairs of the Company.

Bengaluru

April 19, 2019

 

Sd/-

C. Dwarakanath

Company Secretary in Practice

PCS No: 7723; CP No: 4847

Annexure — 6

Report on Corporate Social Responsibility

A brief outline of the Company's Corporate Social Responsibility (CSR) policy including overview of projects or programs proposed to be undertaken and a reference to the web-link to the CSR policy and projects or programmes.

Tejas Networks Limited works towards removing malnutrition, improving healthcare infrastructure, supporting primary education, rehabilitating abandoned women and children, and preserving Indian art and culture. The Company's focus has been to contribute to the sustainable development of the society and environment, and to make our planet a better place for future generations.

The CSR Policy of the Company is available on its website at https://www tejasnetworks.com/policies-codes.php

Vehicle donated to Akshaya Patra Foundation

Tejas' CSR activities will focus on:

- Eradicating extreme hunger, poverty and malnutrition, promoting preventive healthcare and sanitation and making available safe drinking water;

- Promoting education, including special education and employment enhancing vocational skills especially among children, women, elderly and the differently abled, and livelihood enhancement projects;

- Ensuring environmental sustainability, ecological balance, and conservation of natural resources and maintaining the quality of soil, air and water;

- Protecting national heritage, art and culture including restoration of buildings and sites of historical importance and works of art.

In pursuance of the CSR Policy, the Company aims to support projects that promote education and therefore contributed to:

1) The Akshaya Patra Foundation, which provides mid-day meals as an attempt to feed the millions of children in India and give them the motivation and nourishment they need to pursue an education and a better future -Amount contributed Rs 0.25 crore

2) The International Institute of Information Technology, Bengaluru, a Deemed University, popularly known as IIITB, established with a vision to contribute to the IT world by focusing on education and research, entrepreneurship and innovation. The Institute is a registered not-for-profit society funded jointly by the Government of Karnataka and the IT industry - Amount contributed Rs 0.25 crore

3) Vinoba Sewa Ashram, Shahjahanpur, Uttar Pradesh, A Grass root Level Organization motivated by Sarvodaya thoughts by serving the rural people since 1980 on Education, Health, Income Generation and Animal Welfare. The Company contributed towards improving school infrastructure of existing government schools in Ghazipur, Uttar Pradesh - Amount contributed Rs 0.18 crore

4) The Aurobindo Society, Puducherry, Project Inclusion aims to bring children with hidden disability who are unable to cope-up with the World around by giving them equal and quality education and aims to bring such children in forefront and makes Inclusive education a reality Through Project Inclusion, regular school teachers are trained to identify such students and provide them with right kind of training and education. The Project Inclusion operates in states such as Uttar Pradesh, Jharkhand, Chhattisgarh, Uttarakhand, Puducherry, Bihar, Sikkim, Punjab - Amount contributed Rs 0.30 crore

2

The Composition of the CSR Committee as on April 22, 2019

Amb. Leela K Ponappa - Chairperson

Balakrishnan V - Member

Sanjay Nayak - Member

Arnob Roy - Member

3

Average net profit after tax of the Company for last three financial years

Rs 48.75 crore

4

Prescribed CSR Expenditure (two per cent, of the amount as in item 3 above)

Rs 0.98 crore

5

Details of CSR spent during the financial year

 

a

Total amount to be spent for the financial year

Rs 0.98 crore

b

Amount unspent, if any

Nil

c Manner in which the amount spent during the financial year is detailed below:

Our CSR Responsibilities:

We hereby affirm that the CSR Policy, as approved by the Board, has been implemented and the CSR Committee monitors the implementation of the activities in compliance with our CSR objectives.

 

 

for and on behalf of the Board of Directors

 

 

 

Bengaluru

Sd/-

Sd/-

April 22, 2019

Amb. Leela K Ponappa

Sanjay Nayak

 

Chairperson, CSR Committee

Managing Director and CEO

 

Particulars

Details

CSR project or activity identified

1. The Akshaya Patra Foundation

2. International Institute of Information Technology, Bengaluru

3. Sri Aurobindo Society, Puducherry

4. Vinoba Sewa Ashram, Uttar Pradesh

Sector in which the project is covered

CSR contribution is made to educational, research & development, health and infrastructure sectors.

Projects or programme (1) Local area or other (2) Specify the state and district where projects or programs was undertaken

1. The Akshaya Patra Foundation

2. International Institute of Information Technology - Bengaluru

3. Sri Aurobindo Society - Puducherry

4. Vinoba Sewa Ashram - Uttar Pradesh

Amount outlay (budget project or programme wise)

One time

Amount spent on the project or programme Sub Heads; (1) Direct expenditure on projects or programmes (2) Overheads

Rs 0.98 crore

Cumulative expenditure up to the reporting period

Rs 0.98 crore

Amount Spent direct or through implementing agency

The amount were spent through implementing agencies mentioned in point 1 above.

Annexure - 7

Details Of ESOP / Restricted Stock Unit Plan

1. Tejas Networks Limited Employees Stock Option Plan - 2. Tejas Networks Limited Employees Stock Option Plan - 2014 (ESOP Plan 2014) 2014-A (ESOP Plan 2014 - A)

The Company pursuant to resolutions passed by the Board and the The Company pursuant to resolutions passed by the Board and the Shareholders, dated May 29, 2014 and September 24, 2014, respectively, Shareholders, dated June 27, 2016 and July 25, 2016, respectively has adopted ESOP Plan 2014. ESOP Plan 2014 was subsequently has adopted ESOP Plan 2014-A. ESOP Plan 2014-A was modified pursuant to the Shareholders' resolutions dated March 28, subsequently modified pursuant to the Shareholders resolution 2016 and November 19, 2016. Pursuant to ESOP Plan 2014, options to dated November 19, 2016. Pursuant to ESOP Plan 2014-A, options acquire Equity Shares may be granted to eligible employees (as defined to qcquire equity shaes may be granted to eligible employees (as in ESOP Plan 2014). The aggregate number of Equity Shares, which may defined in ESOP Plan 2014-A). The aggregate number of Equity be issued under ESOP Plan 2014, shall not exceed 71,01,767 Equity shares, which may be issued under ESOP Plan 2014-A, shall not Shares. The ESOP Plan 2014 is compliant with the SEBI Regulations and exceed 20,00,000 Equity Shares. ESOP Plan 2014-A is compliant the Companies Act, 2013. with the SEBI Regulations and the Companies Act, 2013.

The details of the ESOP Plan 2014 as on March 31, 2019 are given below:

 

Options granted

69,26,635

Options vested

68,69,919

Options exercised

44,21,613

Total number of shares arising as a result of exercise of option

44,21,613

Options lapsed

64,953

Exercise price

Rs 65.00

Variation of terms of options

Pursuant to a resolution of the Board of Directors dated March 2, 2016 and a resolution of the Shareholders dated March 28, 2016, the size of the ESOP pool was amended. Further, pursuant to a resolution of the Board of Directors dated September 23, 2016 and a resolution of the Shareholders dated November 19, 2016, the exercise period under ESOP 2014 was amended in order to ensure compliance with the SEBI Regulations. Further, amendments were made to the definitions of 'employee', 'promoter', 'promoter group' and 'independent director' to ensure compliance with the SEBI Regulations and the Companies Act, 2013.

Money realized by exercise of options

Rs 28.74crore

Total number of options in force

24,40,069

Employee wise details of options granted to: (i) Key managerial personnel

No options were granted to the KMP's during the year

(ii) Any other employee who receives a grant of options amounting to 5% or more of options granted during the year.

Nil

(iii) Identified employees who were granted option equal to or exceeding 1% of the issued capital of the Company at the time of grant.

Nil

The details of the ESOP Plan 2014-A as on March 31, 2019 are given below:

 

Options granted

19,78,215

Options vested

14,34,700

Options exercised

4,36,841

Total number of shares arising as a result of exercise of option

4,36,841

Options lapsed

64,947

Exercise price

Rs 85/-

Variation of terms of options

Pursuant a resolution of the Board of Directors dated September 23, 2016 and a resolution of the Shareholders dated November 19, 2016, the exercise period under ESOP 2014A was amended in order to ensure compliance with the SEBI Regulations. Further, amendments were made to the definitions of 'employee', 'promoter', 'promoter group' and 'independent director' to ensure compliance with the SEBI ESOP Regulations and the Companies Act, 2013.

Money realized by exercise of options

Rs 3.71 crore

Total number of options in force

14,76,427

Employee wise details of options-granted to: (i) Key managerial personnel

No options were granted to the KMP's during the year

(ii) Any other employee who receives a grant of options amounting to 5% or more of options granted during the year.

Nil

(iii) Identified employees who were granted option equal to or exceeding 1% of the issued capital of the Company at the time of grant.

Nil

3. Tejas Networks Limited Employees Stock Option Plan -2016 (ESOP Plan 2016)

The Company pursuant to resolutions passed by the Board and the Shareholders, dated August 02, 2016 and August 29, 2016, respectively has adopted ESOP 2016. ESOP 2016 was subsequently amended pursuant to the Shareholders resolution dated November 19, 2016. Pursuant to ESOP 2016, options to acquire Equity Shares may be granted to eligible employees (as defined in ESOP 2016). The aggregate number ol Equity Shares, which may be issued under ESOP 2016, shall not exceed 50,00,000 Equity Shares. The ESOP plan 2016 is compliant with the SEBI Regulations and the Companies Act, 2013.

4. Tejas Restricted Stock Unit Plan - 2017 (RSU 2017)

The Company pursuant to resolutions passed by the Board and the Shareholders, dated August 02, 2017 and September 27, 2017, respectively has adopted RSU 2017. The Plan provides alternatives to grant stock units incentives such as RSU's and subject to applicable laws and conditions lor exercise, the Eligible Employees shall be entitled to receive equity shares on exercise ol such RSU's. The total number of RSU's to be granted to the Eligible Employees under RSU 2017 shall not exceed 30,00,000 (Thirty Lakhs). The RSU 2017 is compliant with the SEBI Regulations and the Companies Act, 2013.

The details of the ESOP Plan 2016 as on March 31, 2019 are given below:

 

Options granted

26,26,415

Options vested

15,49,959

Options exercised

4,81,982

Total number of shares arising as a result of exercise of option

4,81,982

Options lapsed

1,19,888 Weighted average exercise

Exercise price

price of options granted -Rs 86.297-

Variation of terms of options

Pursuant to a resolution of the Board of Directors dated September 23, 2016 and a resolution of the Shareholders dated November 19, 2016, the exercise period under ESOP 2016 was amended in order to ensure compliance with the SEBI Regulations. Further, amendments were made to the definitions of 'employee', 'promoter', 'promoter group' and 'independent director' to ensure compliance with the SEBI ESOP Regulations and the Companies Act, 2013.

Money realized by exercise of options

Rs 4.15 crore

Total number of options in force

20,24,545

Employee wise details of options granted to: (i) Key managerial personnel

No options were granted to the KMP's during the year

(ii) Any other employee who receives a grant of options amounting to 5% or more of options granted during the year.

Nil

(iii) Identified employees who were granted option equal to or exceeding 1% of the issued capital of the Company at the time of grant.

Nil

The details of the RSU 2017 as on March 31, 2019 are given below:

RSU 201 7

RSU granted

10,43,340

RSU vested

8,622

RSU exercised

4,127

Total number of shares arising as a result of exercise of RSU

4,127

RSU lapsed*

18,290

Exercise price

10.00

Variation of terms of RSU

Nil

Money realized by exercise of RSU

Rs 41,270/-

Total number of units in force

10,20,923

Employee-wise detail of Sanjay Nayak

55,000

RSU's granted to: Arnob Roy

48,000

(i) Key managerial Venkatesh Gadiyar

32,000

personnel N R Ravikrishnan

10,000

(ii) Any other employee who receives a grant of RSU amounting to 5% Nil or more of RSU granted during the year.

 

(iii) Identified employees who were granted RSU equal to or exceeding 1% of the issued capital of the Company at the time of grant.

 

Note: The Company does not intend to grant further ESOPs to employees as it had formulated the Restricted Stock Unit Plan.

*RSU lapsed can be re-issued and will form part of RSU pool to be granted

# RSU granted amounting to 5.45% of the total RSU granted during the year.

Annexure - 8

1.Particulars of Employees

As prescribed in Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the ratio of the remuneration of each Director to the median employee's remuneration is required to be disclosed in the Director's Report. The tables below specify the details of remuneration of the Directors and Key Managerial Personnel, in compliance with the above stated provisions.

Particulars

Disclosures

The ratio of the remuneration of Managing Director to the median remuneration of the employees of the Company for the financial year

13.38

 

Sanjay Nayak - Managing Director and Chief Executive 29.38% Officer

The percentage increase in remuneration of each Director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year (based on actual payments during the year)

Arnob Roy - Whole-time Director and Chief Operating 25.22% Officer

Venkatesh Gadiyar - Chief Financial Officer 36.32%

N R Ravikrishnan - Company Secretary* 18.14%

Krishnakanth G V - Company Secretary*

The percentage increase in the median remuneration of employees in the financial year

3.04%

The number of permanent employees on the rolls of Company as of March 31, 2019

765

Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

Average salary increment of the employees excluding KMPs was 9.58% over the previous year. The average salary increment of the KMPs was 27.80% over the previous year. The salary increase for KMPs was higher so as to align to industry benchmark levels.

Affirmation that the remuneration is as per the remuneration policy of the Company

Yes

Notes: Computed on the basis of cost to the Company, and does not include the perquisite value of stock options exercised or the value of stock options/ RSUs granted during the period.

Arnob Roy appointed as Whole-time Director and designated as Chief Operating Officer of the Company with effect from March 25, 2019

N R Ravikrishnan appointed as Company Secretary with effect from July 5, 2018

G V Krishnakanth resigned as Company Secretary with effect from closing of business hours of July 4, 2018

Overall headcount increased by 58 employees during the year, majority were hired at entry level

Employee Name

Designation

Age

Educational Qualification

Experience in years

Location

Date of C ommencement of employment

Gross Remuneration (in Rs)

Perquisites on exercise of stock options (in Rs)

Total Remuneration (in Rs)

Previous Employment and Designation

Venkatesh Gadiyar1

Chief Financial Officer

51

CA MS. ECE, North Carolina

27

India

03-Jul-13

64,66,716

1,81,35,438

2,46,02,154

Infosys Ltd, Associate Vice President

Sanjay Nayak2

CEO & Managing Director

55

State University Raleigh, USA

32

India

06-May-OO

1,67,66,712

42,61,875

2,10,28,587

Synopsys India, Managing Director

Harmeet Singh

Senior Vice-President Sales, USA

51

Btech IIT Kanpur, PhD University of Maryland, USA

23

USA

01-Jan-07

1,36,43,606

-

1,36,43,606

Optovia Corporation.USA, CEO

Milind M Kulkarni3

Vice President -R&D

51

MTech in EEE IIT, Mumbai

27

India

17-Apr-02

77,28,972

42,10,625

1,19,39,597

Sycamore Networks, Senior Hardware Engineer

Kumar N Sivarajan4

Chief Technology Officer

53

MS. & PhD, EE, California University, USA

28

India

01-May-00

1,12,53,179

4,12,172

1,16,65,351

Indian Institute Of Science, Associate Professor.

Arnob Roy

Chief Operating Officer

56

MS. CS, University of Nebraska, Lincoln, USA

30

India

10-May-00

1,16,06,540

-

1,16,06,540

Synopsys India, Senior Manager.

Prasad K S5

Group Director -Pre Sales

46

B.E in EC.

25

India

04-Aug-06

53,14,473

56,40,915

1,09,55,388

ECI Telecom India Ltd, Head Projects

Mohan Shyam Dubey6

Vice President -Sales

49

Diploma, Delhi

30

India

17-Mar-08

75,51,337

34,12,651

1,09,63,988

HFCL, General Manger

Shirish Purohit7

Head-Sales (India and Emerging Markets)

56

MTech, IIT Madras

32

India

01-Mar-12

74,82,072

34,66,539

1,09,48,611

Midas Communication Technologies Pvt Ltd, CEO

Murali R8

Group Advisor -Business Planning

70

CA

35

India

28-Aug-06

36,52,107

62,66,250

99,18,357

Sundaram Clayton Ltd, Senior Vice President

II. Top 10 Employees on rolls of the Company in terms of remuneration drawn during fiscal 2019:

'Perquisite value on the exercise of 1,01,875 ESOP's during fiscal 2019. Perquisite value on the exercise of 35,000 ESOP's during fiscal 2019. Perquisite value on the exercise of 17,990 ESOP's during fiscal 2019. ^Perquisite value on the exercise of 5,625 ESOP's during fiscal 2019. Perquisite value on the exercise of 29,250 ESOP's during fiscal 2019. 6Perquisite value on the exercise of 15,812 ESOP's during fiscal 2019. Perquisite value on the exercise of 21,250 ESOP's during fiscal 2019. 8Perquisite value on the exercise of 50,000 ESOP's during fiscal 2019.

Note:

The above table II is based on pay outs made during the year. Gross remuneration includes fixed pay, performance linked variable pay and retired benefits. Perquisite include the perquisite value of stock options/ RSUs exercised during the period, which was granted during earlier years, determined in accordance with the provisions of the Income Tax Act, 1961. Accordingly the value of stock options/RSUs granted during the veriod is not included.

Name of the Policy /Codes/ Charters

Brief Description

Web link

Risk Management Policy

The Policy encompasses policies and procedures relating to the risk management mechanism of the Company.

https://www. tejasnetworks.com/ main-control/download/Risk-assessment-and-Management-and-mitigation-policy-and-procedures.pdf

https://www. tejasnetworks.com/ main-control/download/Document-rentension-and-Archival-Policy.pdf

Policy on Archival and Preservation of Documents

The policy deals with the retention and archival of records of the Company.

Policy on Material subsidiaries

The policy is used to determine the material subsidiaries and material non-listed Indian subsidiaries of the Company and to provide the governance framework for them.

https://www. tejasnetworks.com/ main-control/download/Policy-on-determing-material-subsidiaries.pdf

Corporate Social Responsibility Policy

The policy outlines the Company's strategy to contribute to the sustainable development of the society and environment and to make our planet a better place for future generations.

https://www. tejasnetworks.com/ main-control/download/CSR-Policy pdf

Nomination and Remuneration Policy

This policy formulates the criteria for determining qualifications, competencies, positive attributes and independence for the appointment of a Director (Executive / Non- Executive) and also the criteria for determining the remuneration of the Directors, Key Managerial Personnel and other employees.

https://www. tejasnetworks.com/ main-control/download/NRC-Policy pdf

Whistle Blower Policy and Vigil Mechanism

The Company has adopted a Whistle Blower Policy and has established the necessary vigil mechanism for Directors and employees to report concerns about unethical behaviour.

https://www. tejasnetworks.com/ main-control/download/Whistle-blower-Policy.pdf

Policy on Board Diversity

The policy sets out a framework to promote diversity on Company's Board of Directors.

https://www. tejasnetworks.com/ main-control/download/Policy-on-Board-diversity.pdf

Policy for Determining Material Related Party Transaction

The Policy is to determine the 'materiality' of Related Party Transaction and to provide a governance framework thereof.

https://www. tejasnetworks.com/ main-control/download/Policy-for-determining- Related- Party-transaction.pdf

Annexure — 9

Board Governance Policies

The SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 requires adoption of certain Policies /Codes/Charters for all listed companies. These Policies /Codes/Charters are reviewed periodically by the Board based on the requirements. In line with this, the Board during the year under review has revised certain Policies /Codes/Charters

The policies that were adopted by the Board are as follows:

Dividend Distribution Policy

This policy sets out the parameters and circumstances including external and internal factors and financial parameters that will be taken into account by the Board of Directors of the Company in determining the distribution of dividend and also the circumstances under which the Shareholders of the Company may or may not expect dividend and how the retained earnings shall be utilized.

https://www. tejasnetworks.com/ main-control/download/Dividend-Distribution-Policy.pdf

Policy for determining Material events

The Policy is to determine the materiality of events /information of the Company for the purpose of disclosure to the stock exchanges on which the Company's shares are listed and to provide frame work relating to disclosure of such information.

https://www. tejasnetworks.com/ main-control/download/Policy-for-Determining-Materiality-of-Events.pdf

Code of Conduct and Ethics

This Code shall provide, inter alia, a guide for professional conduct for all the Directors and Employees and to understand, adhere to, comply with and uphold the provisions of this Code and the standards laid down hereunder in their day-to-day functioning and in compliance with the applicable laws.

https://www. tejasnetworks.com/ main-control/download/Code-of-Conduct-and-Ethics.pdf

Code of Conduct for Insider Trading

The policy provides the framework in dealing securities of the Company.

https://www. tejasnetworks.com/ main-control/download/Code-of-Conduct-for-Insider-Trading.pdf

Code of practices and procedures for fair disclosure of Unpublished price sensitive information

The Code ensures timely and adequate disclosure of Unpublished Price Sensitive Information as defined in Regulation 2(n) of the Regulations (Unpublished Price Sensitive Information or UPSI by the Company, its subsidiaries and associates and other stakeholders.

https://www. tejasnetworks.com/ main-control/download/Code-of-Practices-and- Procedures- for- Fair-disclosure-of-UPSI.pdf

Supplier Code of Conduct

This Code seeks to establish Tejas' expectations from its suppliers in relation to the ethical, social and environmental risks, opportunities & working conditions that the supplier provides to its employees.

https://www. tejasnetworks.com/ main-control/download/Supplier%20 Code%20of%20Conduct.pdf

 

स्रोत: रेलीगरे टेचनोवा

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