Dion Global Solutions Ltd
Directors Reports
Dear Members,
Dion Global Solutions Limited
The Board of Directors of Dion Global Solutions Limited ("the Company")
are pleased to present the 23rd Annual Report on the business and operations of
the Company along with the Audited Standalone and Consolidated Financial Statements for
the financial year. ended March 31, 2018
FINANCIAL HIGHLIGHTS
The highlights of the Standalone and Consolidated financial results of the Company for
the Financial Years 2017-18 and 2016-17 are reflected in the table
(Rs. in crore)
| Particulars |
Standalone |
Consolidated |
|
FY |
FY |
FY |
FY |
|
2017-18 |
2016-17 |
2017-18 |
2016-17 |
| Operating Revenue |
24.06 |
28.59 |
230.64 |
236.14 |
| Operating Expenses |
38.89 |
33.97 |
230.76 |
221.48 |
| Operating Profit |
(14.83) |
(5.38) |
(0.12) |
14.66 |
| Non-Operating Income |
21.51 |
22.77 |
23.60 |
22.85 |
| Non-Operating Expenses |
16.78 |
6.56 |
20.93 |
5.13 |
| EBIDTA |
(10.10) |
10.84 |
2.55 |
32.38 |
| Depreciation & Amortization |
1.28 |
1.21 |
25.71 |
18.88 |
| Finance Cost |
33.99 |
27.27 |
53.01 |
44.51 |
| Net Profit / (Loss) Before Tax |
(45.37) |
(17.64) |
(76.18) |
(31.01) |
| Tax |
- |
- |
0.01 |
0.02 |
| Exceptional Items |
465.63 |
0.30 |
419.44 |
12.45 |
| Net Profit / (Loss) After Tax |
(511.00) |
(17.94) |
(495.63) |
(43.48) |
| Other Comprehensive Income / (Loss) |
0.24 |
(0.61) |
12.54 |
(19.57) |
| Total Comprehensive Income / (Loss) |
(510.75) |
(18.55) |
(483.08) |
(63.05) |
Note: As per the notification issued by the Ministry of Corporate Affairs ("MCA"),
the Company has adopted Indian Accounting Standards ("Ind AS") with
effect from April 1, 2017 and accordingly: (a) the financial statements for the year have
been prepared in accordance with Ind AS; and (b) the comparative numbers for the previous
year have been restated to be in conformance with the requirements of Ind AS.
BUSINESS OVERVIEW
The Consolidated Operating Revenue of the Company declined marginally in FY 2017-18 to
Rs.230.64 Cr. The decline in revenue in FY2017-18 is primarily on account of longer sales
cycles due to the overall increased due diligence by the existing well as the new clients.
Consolidated EBIDTA, although lower than the previous year, has remained in positive
territory for the second year in a row, reflecting the effectiveness of the measures taken
over the past two years to improve efficiencies and strengthen the business. There has
been an all-round effort to optimize costs and specific gains have been noted in areas
such as employee cost, rent and travel expenses.
However, some of the cost savings were offset by a sharp increase in Non-Operating
Expenses in the nature of exchange fluctuation, which suppressed EBIDTA. An increase
inDepreciation & Amortization due to the higher capitalization in internally developed
software and in Finance Cost due to an increase primarily due to penal interest by the
banks has resulted in an increase in the Consolidated (pre-exceptional) Net Loss Before
Tax from Rs.31.01 Cr. in the earlier year to Rs.76.18 Cr. during the year under review. An
exceptional charge of Rs.419.44 Cr. was taken on the Profit & Loss Statement,
representing provision for impairment made against goodwill on consolidation and allowance
for expected credit loss on inter-corporate loan extended to a related party (including
accrued interest) to the entire extent of the amount, assessed in the manner prescribed
under Ind AS which became applicable to the Company from
FY 2017-18, and consequently, the Net Loss for the year stood at Rs.495.63 Cr.
The Company's Auditor has, in its report on the financial statements, expressed a
qualified opinion based on a view that an uncertainty exists which casts a doubt on the
Company's ability to continue as a going concern. The Company's management believes that
the Company is a going concern and its business is inherently viable as its core business
being restored to profitability as a result of the restructuring exercise, robust demand
for the Company's products, success in conserving the Company's diverse global customer
base and a strong pipeline of business. Furthermore, the management is in the process of
evaluating financial restructuring options, infusion of new capital and selective
divestment of assets to improve its financial position. The management is confident that
as these efforts yield results, the Company will be well-positioned to build on the
strengths of the core business and deliver superior outcomes.
There has been no change in the nature of business of the Company during the year under
review.
DIVIDEND AND TRANSFER TO RESERVES
Keeping in view the losses for the year under review, the Board of Directors of the
Company has not recommended any dividend for the financial year ended March 31, 2018.
Accordingly, there has been no transfer to general reserves.
MATERIAL CHANGES AND COMMITMENTS, AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH
HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR 2017-18 AND THE DATE OF THE REPORT
The following are the material changes and commitments, affecting the financial
position of the Company, which have occurred between the end of the financial year 2017-18
and the date of this Report: I. Insolvency proceedings for Dion Global Solutions Gmbh
- An application for opening preliminary insolvency proceeding under self-administration
had been filed by Dion Global Solutions GmbH (Dion Germany), a wholly owned
step-down subsidiary of the Company in Frankfurt, Germany. On June 20, 2018, the local
court of Frankfurt am Main, Germany has approved preliminary self-administration as
applied for by Dion Germany.
Subsequently, the insolvency proceedings for Dion Germany have been opened on August
31, 2018 and effective September 01, 2018, the operating business of Dion Germany has been
acquired by the new investor (Valantic) in Germany including the employees and service
offering to the customers, partners and suppliers.
Your Company's Management is working closely with the new investor during the
transition period and ensure that any organisational, operational, product and technology
related interdependencies are being carefully reviewed and resolved. In the interim, Dion
Germany will be winding down its business under the court appointed directors. II. Sale
of certain assets in Australia - Dion Global Solutions Pty. Ltd. (DGSPL), a
wholly owned step-down subsidiary of the Company, and its subsidiaries in Australia, in
respect of the said subsidiaries, have entered into an Asset Sale and Purchase Agreement
with FinClear Pty. Ltd. The proposed transaction is subject to the satisfaction of the
conditions precedent which is expected to be completed in November.
III. Disinvestment of shareholding held in Chase Cooper Holdings Limited (CCHL)
DGSPL has entered into Share Purchase Agreement with CCHL on September 24, 2018 w.r.t
entire 44% shareholding held by DGSPL in CCHL. Subsequent to the above, CCHL and its
subsidiaries ceased to be subsidiaries of the Company with effect from September 24, 2018
pursuant to the transfer of aforesaid shareholding from DGSPL to CCHL.
IV. Filing of an application by Axis Bank Limited in Debt Recovery Tribunal - An
Original Application has been filed by Axis Bank Ltd. ("Bank") against
the Promoters, PromoterGroup Entity and the Company in Hon'ble Debt Recovery Tribunal II
at New Delhi for recovery of Rs. 171.56 Cr. in relation to the credit facilities
sanctioned to the Company by the Bank which is, inter-alia, secured by unconditional and
irrevocable, joint and several, personal guarantees from Promoters, Corporate Guarantee of
RHC Holding Pvt. Ltd. and certain other securities provided by the promoter group entities
to the Bank. As the facilities have already been properly accounted for and included in
the financial statements, so there will be no other foreseen / expected financial
implications on the Company. The said application is currently pending.
MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report for the financial year under review
detailing economic scenario and outlook, as stipulated under Regulation 34 of the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing
Regulations"), is presented in a separate section and forms part of this Report.
AWARDS AND RECOGNITIONS
Our wealth management solutions are widely acclaimed across the UK and were nominated
and recognised with a number of key industry awards. We have received the following awards
and recognitions-
- Won the ‘Best Innovative Solutions' Award at the Systems in The City 2017, by
Goodacre UK.
- Dion's Global Head of Pre-Sales won the ‘Best Product to help improve Manager'
for her significant and grow the clients' business.
- Won ‘Best Investment Management Solution' award for a key module of recently
launched Wealth Intelligence (WIN) platform.
- Four individual accolades were given to our wealth management team, who were
nominated by the clients for whom they worked.
SHARE CAPITAL
During the year under review, there has been no change in the Share Capital of the
Company.
ANNUAL RETURN
An extract of Annual Return in Form No. MGT 9 as required to be prepared in Section
92(3) of the Companies Act, 2013 ("Act") is being uploaded on the website
of the Company and can be accessed through the link http://investors.dionglobal.
com/AGM-Notices.aspx
DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATES COMPANIES
During the year under review, the following companies have been dissolved /
deregistered and accordingly, ceased to be subsidiaries of the Company:
1. Dion Latam S.A.;
2. Dion Panama S.A.; and
3. Dion Global Solutions (Development) Pty. Ltd.
Further, the Company has no joint ventures / associate companies during the year under
review.
The Board of Directors has formulated a Policy for determining Material Subsidiaries
which has been uploaded on the Company's website and can be accessed through the link http://investors.dionglobal.com/Policies-Codes.aspx.
PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES, ASSOCIATES AND JOINT
VENTURE COMPANIES
In terms of Section 129(3) of the Act read with Rule 5 of the Companies (Accounts)
Rules, 2014 (as amended), a separate statement containing the salient features of the
financial statement of Company's subsidiaries, associates and joint ventures companies in
Form AOC – 1 is attached to the Consolidated Financial Statements of the Company. The
said statement contains a report on the performance and financial position of each of the
subsidiaries, associate and joint ventures companies included in the Consolidated
Financial Statement and hence is not repeated here for the sake of brevity.
The Company will provide a copy of separate audited or unaudited financialstatements,
as the case may be, as prepared in respect of each of its subsidiaries to any shareholder
of the Company who asks for it and the said financial statements will also be kept open
for inspection during normal business hours at the registered office of the Company.
CONSOLIDATED FINANCIAL STATEMENTS
Pursuant to Regulation 34 of the Listing Regulations and Section 129 of the Act,
Consolidated Financial Statements of the Company and its subsidiaries, duly audited by the
Statutory Auditors of the Company, are provided in this Annual Report.
The Consolidated Financial Statements have been prepared in according with applicable
Accounting Standards issued by the Institute of Chartered Accountants of India and
referred to in Sections 129 & 133 of the Act.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The particulars of loans, guarantees and investments given under Section 186 of the Act
and outstanding during the year under review have been disclosed in the notes forming part
of the Financial Statements.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All transactions entered into with Related Parties during the financial year under
review were in the ordinary course of business and on an arm's length basis. The details
of the transactions with related parties are provided in the notes to accompanying
standalone financial statements.
All Related Party transactions are placed before the Audit Committee for approval as
required under Regulation 23 of the Listing Regulations. Prior omnibus approval of the
Audit Committee is obtained for the transactions which are of a foreseen and repetitive
nature. A statement giving details of all related party transactions entered into pursuant
to the omnibus approval so granted is placed before the Audit Committee for their review
on a quarterly basis.
The policy on Related Party Transactions, as approved by the Board, has been uploaded
on the Company's website and can be accessed through the link: http://investors.dionglobal.com/Policies-Codes.aspx.
None of the Directors has any pecuniary relationship or transaction vis-a-vis the
Company, except to the extent of sitting fees paid to them.
Disclosures as required under Section 134(3)(h) of the Act read with Rule 8(2) of the
Companies (Accounts) Rules, 2014 are provided in Form AOC-2 annexed herewith as Annexure
– A and forms part of this Report.
DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE
FINANCIAL STATEMENTS
The Company has in place adequate internal financial controls with reference to the
financial statements and were operating effectively. The controls are adequate to provide
reasonable assurance regarding timely preparation of reliable financial statements, the
safeguarding of assets, prevention & detection of fraud and errors, the accuracy and
completeness of accounting records and ensuring compliance of corporate policies. The
Company has appointed M/s KPMG as the Internal Auditor of the Company, as approved by the
Audit Committee, for the year under review. KPMG also assist the Company and its key
subsidiaries in testing and reporting of Internal Financial Controls through an integrated
system of internal audit. To maintain its objectivity and independence, the Internal
Auditor reports directly to the Audit Committee.
The Internal Auditor evaluates the efficacy and adequacy of internal financial controls
in the Company, its compliance with operating systems, accounting procedures, policies and
regulatory requirements at all the locations of the Company and its key subsidiaries.
Based on the report of internal audit function, process owners undertake corrective action
in their respective areas and thereby strengthen the internal controls.
RISK MANAGEMENT POLICY
The Company has developed and implemented a Risk Management Policy to mitigate the
various risks that can impact the ability to achieve its strategic objectives.
The Company adopts a systematic approach to mitigate risks associated with
accomplishment of objectives, operations, revenues and regulations. The Company believes
that this would ensure mitigating steps proactively and help to achieve stated objectives.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the year under review, Dr. Gaurav Laroia, Non-Executive Independent Director and
Mr. Ravi Umesh Mehrotra, Non-Executive Non-Independent Director have resigned from the
office of Directors of the Company with effect from April 12, 2017 and Mr. Ralph James
Horne, Non-Executive Non-Independent Director, had resigned from the office of Director of
the Company with effect from March 29, 2018. The Board of Directors placed on record its
appreciation for the valuable services and guidance provided by them during their tenure
as Directors of the Company.
The Members of the Company at their 22nd Annual General Meeting ("AGM")
held on September 26, 2017 approved the appointment of Mr. Vivek Satish Agarwal as a
Non-Executive Non-Independent Nominee Director with effect from the date of his
appointment as an Additional Director. Further, the Members of the Company at the said AGM
has also approved the appointment of Mr. Balinder Singh Dhillon as a Director of the
Company whose period of office shall be liable to determination by retirement of Directors
by rotation.
Subsequent to the financial year ended March 31, 2018, the following are the changes in
the Directors of the Company:
| S. No. |
Name |
Category |
Date of Appointment |
Date of Resignation |
| 1. |
Mr. Balinder Singh Dhillon |
Non-Executive Non -Independent Director |
- |
April 19, 2018 |
| 2. |
Mr. Vivek Satish Agarwal |
Non-Executive Non -Independent Nominee Director |
- |
May 16, 2018 |
| 3. |
Mr. Daljit Singh |
Non-Executive Non-Independent Director |
- |
May 28, 2018 |
| 4. |
Dr. Vandana Nadig Nair |
Non-Executive Independent Director |
- |
June 21, 2018 |
| 5. |
Ms. Kiran Sharma |
Non-Executive Independent Director |
August 14, 2018 |
- |
| 6. |
Ms. Jayashree Swaminathan |
Non-Executive Independent Director |
August 31, 2018 |
- |
| 7. |
Mr. Sanjeev Chandna |
Non-Executive Independent Director |
September 12, 2018 |
- |
| 8. |
Mr. Amit Sethi |
Non-Executive Independent Director |
- |
September 12, 2018 |
| 9. |
Mr. Rashi Dhir |
Non-Executive Independent Director |
- |
September 12, 2018 |
The Board of Directors placed on record its appreciation for the valuable services and
guidance provided by the Directors, who have resigned, during their tenure as Directors of
the Company. Further, Mr. Maninder Singh Grewal has been re-designated as Independent
Director of the Company with effect from
July 19, 2018 and will hold the office of Independent Director for a term of 5 (five)
years from the aforesaid date. However, the said appointment to the office is subject to
the approval of Shareholders of the Company in the General Meeting In terms of Section 161
of the Act, Ms. Kiran Sharma, Ms. Jayashree Swaminathan and Mr. Sanjeev Chandna would hold
office upto the date of the ensuing AGM of the Company. The Company has received notices
in writing from a Member proposing Ms. Kiran Sharma, Ms. Jayashree Swaminathan and Mr.
Sanjeev Chandna for appointment as Directors of the Company. The Nomination and
Remuneration Committee and the Board of Directors recommends their appointment. Brief
resume of the Directors seeking appointment along with other details as stipulated under
Regulation 36 of the Listing Regulations, are provided in the Notice for convening the AGM
of the Company.
All Independent Directors have submitted declarations that they meet the criteria of
independence as laid down under Section 149(6) of the Act and Regulation 16(1)(b) of the
Listing Regulations.
BOARD / COMMITTEE COMPOSITION AND MEETINGS
The Board of Directors of the Company met 4 (Four) times during the financial year
2017-18. The details of composition of Board and Committees and their meetings held during
the year under review are provided in the Report on Corporate Governance, which forms part
of this Report. The intervening gap between two meetings of the Board was within the
period prescribed under the Act and Regulation 17 of the Listing Regulations.
BOARD EVALUATION
Pursuant to the provisions of the Act and the Listing Regulations, the Board and the
respective committees are required to carry out performance evaluation of the Board as a
body, the Directors individually, Chairman as well as that of its Committees. The
following process of evaluation, as approved by the Nomination & Remuneration
Committee ("NRC") and the Board of Directors, was followed:
| S. No. |
Process |
Remarks Criteria for Evaluation (including Independent Directors) |
| 1. |
Individual Self- Assessment |
Self - evaluation This includes Members forms were shared Selection and Induction and
completed by Process, knowledge, the Directors and skills, diligence, submitted to the
Process participation, Coordinator. leadership skills and personnel attributes. |
| 2. |
One to One discussion |
Process Coordinator, This includes Board as recommended by focus (Strategic NRC, was
authorized inputs), Board Meeting to interact with each Management, Board member to Board
Effectiveness assess performance, Management invite direct feedback Engagement and and
seek inputs to addressing of follow up identify opportunities for requests. improvement. |
| 3. |
Evaluation by the Board, NRC and Independent Directors |
A compilation of This includes the individual self- demonstration of assessments and
one integrity, commitment, to one discussion attendance at the were placed issued by M/s
VAP & Associates, at the meetings, contribution meeting of the NRC, and participation,
Board of Directors and professionalism, Independent Director's contribution while held on
February 14, developing Annual 2018 for them to review Operating Plans, collectively and
include demonstration of roles as additional feedback and responsibilities, to the formal
process review of high risk completed in the issues & grievance meetings. redressal
mechanism, succession planning, working of Board Committees etc. |
| 4. |
Final recording and reporting |
Based on the above, NA a final report on Board Evaluation 2017-18 was collated,
presented and tabled at a meeting of the Board of Directors held on May 24, 2018. The
report also noted opportunities for improvement. |
REMUNERATION POLICY
The Board has, on the recommendation of the Nomination & Remuneration Committee,
framed a policy for selection and appointment of Directors, Senior Management and their
remuneration including criteria for determining qualifications, positive attributes,
independence of a Director, etc. Details of the Remuneration Policy and changes, if any,
are provided in the Report on Corporate Governance which forms part of this
Report.
DIRECTORS' RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and based on the representation as provided
to the Board by the management, your Directors make the following statements in term of
Section 134(5) of the Act:
(a) in the preparation of annual accounts for the financial year ended March 31, 2018,
the applicable accounting standards have been followed along with proper explanation
relating to material departures, wherever applicable;
(b) they 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 loss of
the Company for that period;
(c) they had taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of this Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities;
(d) the annual accounts for the financialyear ended March 31, 2018 have been prepared
on a ‘going concern' basis on the basis of management view as placed before the Audit
Committee and the Board;
(e) they had laid down internal financialcontrols to be followed by the Company and
such internal financial controls are adequate and were operating effectively; and
(f) they had devised proper systems to ensure proper compliance with provisions of all
applicable laws and that such systems were adequate and operating effectively.
REPORT ON CORPORATE GOVERNANCE
The Company continues to be committed to uphold the standards of Corporate Governance
and adhere to the requirements set out by the Listing Regulations.
A detailed Report on Corporate Governance along with Company the Certificate
Secretaries, confirming the compliance with the conditions of Corporate Governance, as
stipulated in the Listing Regulations, for the financial year ended March 31, 2018 is set
out in this Annual Report and forms an integral part of this Report.
AUDITORS Statutory Auditors
Pursuant to the provisions of Section 139 of the Act and the Rules framed thereunder,
M/s S.S. Kothari Mehta & Co., Chartered Accountants (Firm Registration No. 000756N)
were appointed as Statutory Auditors of the Company from the conclusion of the 21st
Annual General Meeting (AGM) of the Company held on September 23, 2016 until the
conclusion of the AGM of the Company to be held in the year 2021 (subject to ratification
of their appointment by the Members at every AGM) at such remuneration as may be mutually
agreed between the Board of Directors and the Auditors.
Pursuant to the provisions of Companies (Amendment) Act, 2017 read with MCA
notification dated May 7, 2018, the appointment of Statutory Auditors is not required to
be ratified at every AGM. Therefore, no resolution shall be taken into for the
ratification of appointment of a Statutory Auditor at the forthcoming 23rd AGM
of the Company.
The Statutory Auditors have, in their report to the Board of Directors on the
Standalone and Consolidated Financial Statements of the Company, made the following
qualification:
Basis of Qualified Opinion
As per the accompanying note no. 48(h) of the Standalone Financial Statements wherein
it has been explained by the management that the financial statements have been prepared
on going concern basis.
The Company has substantial negative net worth and accumulated losses of past years;
The Company has made a default in the repayment of Principal and Interest against all the
facilities sanctioned by Banks; There is no committed agreement for the infusion of funds
by any investors; Due to payment defaults made by the Regius Overseas Holding Co. Ltd.
("ROHCL") wholly owned subsidiary of the Company, lending banks of ROHCL have
invoked the SBLCs issued by Axis Bank and Yes Bank. Being the guarantor, now the loan
amount is payable by the company to the banks. As explained to us in respect of SBLC
invocations, due to the aforesaid defaults and lack of clarity, the company is seeking
clarification from RBI, whether file the form ODI under automatic or approval route;
Axis Bank Limited ("ABL") vide its letter dated August 29, 2017 had recalled
all the credit facilities given to the Company and ABL had also adjusted a part of the
facility against realization of invoked shares of Religare Enterprises Limited and Fortis
Healthcare Limited, which are kept by the promoter or promoter group as securities.;
Yes Bank Limited have informed the company that all the facilities provided by the Yes
Bank have been reclassified as non-performing assets (NPA), etc. ;
Considering the non-ascertainable consequential impact of these factors, events or
conditions on financial statements from Statutory indicate that a material uncertainty
exists and may cast the to continue as a significant going concern and therefore, the
company is unable to realise its assets and discharge its liabilities in the normal course
of business at the amounts stated in the financial statement.
Management response on the Statutory Auditors' Qualified Opinion on Company's
Standalone and Consolidated Financial Statements:
The material uncertainty due to reported negative net worth, is primarily due to the
impairment and provision accounted for on a prudent & conservative basis while the
Company's product margins are positive.
The rationale for management to continue to believe that the annual accounts are
prepared on a going concern basis is a healthy profitable core business, a continuing
product demand through contract renewals, a diverse global customer base which remains
largely intact, existing contracts contributing license, maintenance and support &
professional services revenues coupled with existing pipeline across existing and new
customers.
In addition to the above, the Company is in the process of evaluating financial
restructuring options, including debt structuring and capital infusion and select
divestments of assets, each of which will enable the Company to sustain its business
operations.
Secretarial Auditor
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, Mr. Mohit Maheshwari, Company Secretary
in Whole-time Practice, has conducted the Secretarial Audit of the Company for the
financial year 2017-18. The Secretarial Audit Report of the Company for the financial year
ended March 31, 2018, is annexed herewith as Annexure – B to this Report.
The Secretarial Auditor in its report has made the following qualification: During the
period under review, to the best of my knowledge and belief and according to the
information and explanations given to me, the Company has complied with the provisions of
the Acts, Rules, Regulations and Agreements mentioned above, to the extent applicable. However,
during the period under review, due to the payment defaults made by the Regius
Overseas Holding Co. Ltd. (ROHCL), wholly owned subsidiary of the Company, lending bank
of ROHCL has invoked the SBLC issued by Yes Bank Limited. Being the guarantor, now the
loan amount is payable by the Company to the bank. The Company has not reported of
invocation of SBLC to RBI upto the date of this report. I have been informed by the
Company that the Company is seeking clarification from RBI, whether to file the form ODI
for invocation of SBLC under automatic route or approval route.
Management response on aforesaid qualification given by Secretarial Auditor in its
report are as follows:
In terms of ODI Master Directions, the investments / financial commitments are subject
to certain conditions which, inter-alia, includes that the Indian Party should not be on
the Reserve Bank of India ('RBI') Exporters' caution list / list of defaulters to the
banking system circulated by the RBI / Credit Information Bureau (India) Limited
(CIBIL)/or any other credit information company as approved by the Reserve Bank or under
investigation by an investigation / enforcement agency or regulatory body. On account of
invocation of SBLC, as referred in the qualification, the Company was required to file
Form ODI Part I with all requisite annexures (including certificate to the RBI to report
the said invocation. Having regard to the defaults with the banks and the subsequent
discussions with Authorized Dealer (‘AD‘) Bank of the Company, the management is
of the view that the Company can't ascertain whether it is in the list of defaulters as it
has no access of the list of defaulters to the banking system circulated by RBI or CIBIL
or any other approved credit information company. However, the Auditors are of the
different view that the aforesaid defaults may be considered of not fulfilling the
abovementioned requirement / condition specified under ODI Master Directions and prior
approval of the RBI would be required for reporting the SBLC invocation. To seek
clarification on the above, the Company had approached RBI but there has been no response
till date from RBI on the matter. Accordingly, the management now on a conservative basis,
has filed an application with RBI for requisite approval and the said approval is still
awaited.
PUBLIC DEPOSITS
During the year under review, the Company has neither invited nor accepted any deposits
from public pursuant to the provisions of Section 73 of the Act read with Companies
(Acceptance of Deposit) Rules, 2014 and therefore, no amount of principal or interest was
outstanding in respect of deposits from the Public as of the date of Balance Sheet.
LISTING WITH STOCK EXCHANGE
The Equity Shares of the Company continue to be listed on BSE Limited ("BSE").
The Annual Listing Fee for the financial year 2018-19 has been paid to the BSE.
EMPLOYEE STOCK OPTION SCHEME
The Nomination and Remuneration Committee (NRC) of the Board of Directors of the
Company, inter-alia, administers and monitors the Dion Global Employee Stock Option Scheme
2013 ("ESOP 2013") of the Company in accordance with the Securities and
Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 ("SEBI
Guidelines").
As per Regulation 14 of the SEBI Guidelines, disclosure of the ESOP Scheme of the
Company has been uploaded on the website of the Company which can be accessed through the
link http://investors.dionglobal.com/ESOP-Disclosures.aspx and forms part of this
Report.
During the year under review, the Board of Directors of the Company on the
recommendations of NRC, had cancelled the Dion Global Employee Stock Option Scheme 2011.
Further, there was no material change in the ESOP 2013 of the Company and the ESOP 2013 is
in compliance with the SEBI Guidelines. The certificate from Statutory Auditors of the
Company confirming that the ESOP 2013 has been implemented in accordance with the SEBI
Guidelines would be placed at the forthcoming Annual General Meeting of the Company for
inspection by the Members.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Even though operations of the Company are not energy intensive, as an on-going process,
the management has been highly conscious of the importance to conserve energy and
environment at all operational levels and efforts are made in this direction on a
continuous basis. The Company continued to take the steps for power savings through
effective operational controls and close monitoring of utilization.
With respect to technology absorption, the use of cloud based services has
significantly reduced the telecommunication costs. Further, the dependency on servers and
in-house data centers has also been reduced by effectively implementing the cloud leading
to improved productivity and reduced spending on infrastructure & IT.
However, in view of the nature of activities which are being carried on by the Company,
the particulars as prescribed under Section 134(3)(m) of the Act read with Rule 8 of the
Companies (Accounts) Rules, 2014 regarding Conservation of Energy and Technology
Absorption are not applicable to the Company and hence not been provided.
The Company has continued to maintain focus on and avail of export opportunities based
on economic considerations. The Company has earned Rs 9.88 Crores (Previous Year: Rs.
20.14 Crores) in Foreign Exchange and incurred expenditure of Rs 0.54 Crores (Previous
Year: Rs. 1.05 Crores) in Foreign Exchange during the year under review on a standalone
basis.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Statement of Particulars of Employees as required under Section 197 of the Act read
with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 (Rules) as amended from time to time, forms part of this Report.
However, pursuant to Section 136 of the Act, this Report and Financial Statements are
being sent to the Members and others entitled thereto excluding the aforesaid information
and the said particulars are available for inspection by the Members at the Registered
Office of the Company during normal business hours on working days of the Company upto the
date of the ensuing Annual General Meeting. The Members desirous of obtaining such
particulars may write to the Company Secretary at the Registered Office / Corporate Office
of the Company in this regard.
Disclosures of the ratio of the remuneration of each director to the median employee's
remuneration and other details as required pursuant to Section 197(12) of the Act read
with Rule 5(1) of the Rules are annexed herewith as Annexure - C and forms part of
this Report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has in place a mechanism in form of Whistle Blower Policy (Policy)
for Directors and employees of the Company to report their genuine concerns and to deal
with instance of unethical practices, fraud and mismanagement or gross misconduct by the
employees of the Company, if any, that can lead to financial loss or reputational risk to
the organization. The details of the Policy are provided in the Report on Corporate
Governance and the said Policy has also been uploaded on the website of the Company.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION
AND REDRESSAL) ACT, 2013
The Company is committed to provide a healthy environment to all employees and thus,
does not tolerate any discrimination and/or harassment in any form. The Company has in
place an Anti-Harassment and Grievance Redressal Policy in line with the requirements of
The Sexual Harassment of Women at the Work Place (Prevention, Prohibition and Redressal)
Act, 2013 and the rules made thereunder. An Internal Compliance Committee is in place as
per the requirements of the said Act to redress complaints received regarding sexual
harassment. All employees (permanent, contractual, temporary, trainees) are covered under
the said Policy. No case has been reported during the year under review.
HUMAN RESOURCES
The year of 2017-18 continued to be a year of re-organization and restructuring for
your Company. All these changes required to be managed with a lot of sensitivity and care.
HR with support of the management team were able to successfully implement the changes and
more importantly maintain a level of stability with the retained team.
During a fairly tumultuous 2017-18, HR continued to pro-actively work on several
initiatives to overcome the challenges faced by the organization to retain the existing
employees as well as attract good talent from the market. These initiatives include
regular management discussions, acknowledge employees' accomplishments, offer role
enhancements with larger accountabilities, maintain transparency and keep them updated
with the future plans and prospects. This helped us in building their confidence and trust
in the Company. HR continued to pro-actively work on several initiatives towards
strengthening of the human resources management aspects relating to employee productivity
and cost, employee retention, talent management, employee engagement and various other
engaging activities.
We have continued to nurture a culture of diverse thinking, leading to an array of
ideas and initiatives that resulted in sustained workforce engagement. We continue to
focus on investing strategically in creating new growth opportunities for the future while
continuing to drive our core to full potential, ensuring excellence and building on our
agile and high-performance culture.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS
During the significantand year under review, there are no material orders passed by the
Regulators / Courts / Tribunals which would impact the going concern status of the Company
and its operations in future.
ACKNOWLEDGEMENTS
Your Directors place on record their gratitude to the Bankers, Regulatory Bodies,
Stakeholders and other business associates for the assistance and co-operations they have
extended to the Company during the year and look forward to their continued support in
future.
Your Directors also greatly appreciate the commitment and dedication of all employees
at all levels towards the growth of the Company.
|
For and on behalf of the Board |
|
For Dion Global Solutions Limited |
|
Sd/- |
| Place : Noida |
Maninder Singh Grewal |
| Date : November 15, 2018 |
Chairman |
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