D B Corp Ltd
Directors Reports
Board's Report
To
The Members,
D. B. Corp Limited
Your Directors have pleasure in presenting to you the 22nd Annual Report
together with the Balance Sheet and Statement of Profit and Loss for the year ended 31st
March, 2018.
FINANCIAL HIGHLIGHTS (STANDALONE RESULTS)
Rs. in Mn.
| PARTICULARS |
2017-18 |
2016-17 |
| Revenue from operations |
23,285 |
22,574 |
| Other Income |
239 |
172 |
| Total Revenue |
23,524 |
22,746 |
| Operating expenditure |
17,645 |
16,130 |
| EBITDA |
5,879 |
6,616 |
| EBITDA Margin |
24.99% |
29.09% |
| Finance Cost |
67 |
74 |
| Depreciation & Amortisation |
922 |
862 |
| Total Expenditure |
18,634 |
17,066 |
| Profit Before Tax |
4,890 |
5,680 |
| Provision for Tax |
1,645 |
1,907 |
| Profit After Tax (PAT) |
3,245 |
3,773 |
| PAT Margin |
13.79% |
16.59% |
| FINANCIAL HIGHLIGHTS (CONSOLIDATED RESULTS) |
|
|
|
|
Rs. in Mn. |
| PARTICULARS |
2017-18 |
2016-17 |
| Revenue from operations |
23,285 |
22,580 |
| Other Income |
238 |
170 |
| Total Revenue |
23,523 |
22,750 |
| Operating expenditure |
17,647 |
16,158 |
| EBITDA |
5,876 |
6,592 |
| EBITDA Margin |
24.98% |
28.97% |
| Finance Cost |
67 |
74 |
| Depreciation & Amortisation |
924 |
863 |
| Total Expenditure |
18,638 |
17,095 |
| Profit Before Tax |
4,885 |
5,655 |
| Provision for Tax |
1,645 |
1,907 |
| Profit After Tax (PAT) |
3,240 |
3748 |
| PAT Margin |
13.77% |
16.47% |
| Dividend as % of Paid-up Share Capital |
10% |
40% |
REVIEW OF PERFORMANCE, OPERATIONAL HIGHLIGHTS AND FUTURE OUTLOOK
India as one of the faster growing economies of the world, demonstrated strong
resilience on the face of global slow growth environment. India is expected to emerge as
one of the top three economic powers of the world over the next 10-15 years, as per the
Central Statistics Organisation (CSO) and IMF (International Monetary Fund). Moody's
upgradation of India's sovereign rating after 14 years, from Baa3 (lowest investment
grade) to Baa2, also underlines the strength of the country's economic fundamentals.
After a temporary slowdown triggered by the implementation of demonetization and GST,
the economy started showing signs of recovery in the second half of FY 18. The revival in
positive sentiment was reflected in the pick-up in industrial production and a decline in
retail inflation (as measured by the CPI) after a period of negativity. The last quarter
of the fiscal saw India record its fastest growth in seven quarters at 7.7%, to overtake
China, which grew at 6.8% in the quarter ended March 2018. The farm, manufacturing and
services sectors propelled this growth, which is expected to sustain in the coming year.
D. B. Corp Limited's (DBCL) performance for the fiscal 2017-18 needs to be viewed in
the context of aforesaid economic and market environment forces. D. B. Corp Limited
(‘DBCL') delivered another year of resilient performance aided by strong market
development strategies, establishment of long term customer relationships and well planned
execution of sharper on-ground marketing efforts.
Your Company maintained its focus on editorial strategy which has led to significant
improvement in quality of editorial content, greater readership delight and growth. Dainik
Bhaskar newspaper continues to be the Nation's largest circulated multi-edition daily as
per Press In India Report 2016-17 prepared by the Registrar of Newspapers of India (RNI)
and recently informed by the Honourable Union Information and Broadcasting Minister, Mr.
Rajyavardhan Singh Rathore in Parliament during an answer.
As per recently announced Indian Readership Survey (IRS) numbers, the Dainik Bhaskar
Group has maintained its leadership as the Largest Newspaper Group of Urban India. Dainik
Bhaskar newspaper continues to hold the # 1 position as the largest read newspaper of SEC
AB (Socio- Economic Class AB), which is now called NCCS AB. The Dainik Bhaskar newspaper
also holds #1 position as the largest read newspaper of Socio-economic Class - A, i.e. SEC
A, which is now called NCCS A.
Dainik Bhaskar continues to be the world's fourth largest circulated news daily by
WAN-IFRA in its World Press Trends 2016 report. It ranks behind 3 newspapers which are
from outside India; of which 2 are from Japan and 1 from USA.
As part of other significant developments, the following are noteworthy:
• During FY 2017-18 the company executed a challenging and ambitious
Circulation Expansion strategy in its legacy markets of Rajasthan, Gujarat and in the
newer market of Bihar. The circulation copies increased from an average of 50.4 lakh
copies at the start of the initiative in July 2017 to 57.9 lakh copies by the end of the
year i.e. a growth of around 15% in a 9-month's period; and this entire circulation
increase was achieved at a higher cover price.
• Dainik Bhaskar has successfully completed entire Bihar expansion drive. It
has aggressively expanded copies in circulation reflecting over 2x growth across 38
districts covering key Tier II and Tier III cities and towns in Bihar with around 7 lakh
copies.
• MY FM completed the fastest roll out of all 13 newly acquired stations under
Batch 1 of Phase III and expanded the company's reach to 7 states and across 30 cities by
March 2017. Your Radio business MY FM has become the largest player in the Rest of
Maharashtra and No. 1 in Chandigarh / Haryana / Punjab / Rajasthan / Madhya Pradesh &
Chhattisgarh.
• As a part of DBCL's digital business, www.dainikbhaskar.com the largest
Hindi News Website continues to secure the No. 1 spot in Hindi News and
www.divyabhaskar.com continues to remain #1 Gujarati website.
• The digital business with 9 internet portals with a very formidable and
strong position in almost 67% of Indian language media space in terms of Unique Visitors
and Page Views is the dominant No.1 digital player in various Indian languages, i.e.,
Hindi and Gujarati, alongside 4 actively available and well-used mobile apps.
Print Business
During the period under review, the Indian economy showed an improvement over 2016-17,
but continued to grow at a slower pace. DBCL executed a challenging and ambitious
Circulation Expansion strategy in its legacy markets of Rajasthan, Gujarat and in the
newer market of Bihar. We are happy to report that it has delivered favourable response
with advertising revenue witnessing a growth of around 3 % and circulation revenue
registering a growth of around 7%.
Performance highlights of the Company during the year under consideration are as
follows:
• Standalone revenue from operations and other income was Rs. 23,524
million witnessing a growth of 3.42% as compared to Rs. 22,746 million in the previous
year.
• Standalone advertising revenue grew 2.83% to
Rs. 16,425 million which includes revenue from print, radio and digital media business.
• Circulation revenue grew by 7% to Rs. 5,145 million from
Rs. 4,814 million largely driven by rate growth. Circulation revenue has witnessed CAGR
growth of around 15% for past 5 years largely driven by rate growth.
• The consolidated gross revenue increased by 3.4% to
Rs. 23,523 million as compared to Rs. 22,750 million in the previous year.
• EBIDTA margin of matured business stands at 28.59%.
The Company has not transferred any amount to General Reserve for the FY 2017-18.
Emerging Editions / Business
In order to analyse the performance of the Company, its divisions / editions are
segmented into emerging and matured editions / business as any new edition / business
launched takes long for stabilisation and for earnings.
Review of Performance of Emerging Editions / Business Summary Financials (Standalone
Results) ( Rs. in Mn.)
| PARTICULARS |
Emerging Editions |
Matured Business |
Total |
|
& Business |
|
|
|
|
FY 2017-18 |
|
| Turnover |
|
|
|
| -- Advt. Revenue |
516 |
15,909 |
16,425 |
| -- Sales |
276 |
4,869 |
5,145 |
| -- Others |
92 |
1,862 |
1,954 |
| Total Income |
884 |
22,640 |
23,524 |
| Newsprint Cost |
601 |
6,707 |
7,308 |
| Opex |
878 |
9,459 |
10,337 |
| Total Cost |
1,479 |
16,166 |
17,645 |
| EBITDA |
(595) |
6,474 |
5,879 |
| EBITDA Margin (%) |
(67.30%) |
28.59% |
24.99% |
| Interest |
1 |
66 |
67 |
| Depreciation |
51 |
871 |
922 |
| PBT |
(647) |
5,537 |
4,890 |
| PBT Margin (%) |
(73.19%) |
24.45% |
20.79% |
Emerging editions are classified as those editions which are below four years of age or
which have turned profitable in last four consecutive quarters, whichever is earlier.
For FY 2017-18, the emerging editions include editions in newly launched states of
Maharashtra and Bihar, Mobile app and also newly launched e-real estate division during FY
2015-16. Due to shifting of Jharkhand and most part of Maharashtra in Matured category,
Emerging business revenues are not comparable on a YoY basis. At the same time, matured
business has reported EBIDTA Margin at 28.59%.
Radio Business
94.3 MY FM is one of the largest radio network of the Tier II and Tier III cities,
spread across seven states and 30 cities (including the newly launched 13 radio stations
under Batch 1 of phase III in the previous year) commanding a leadership rank in almost
all of its markets, both in terms of listenership as well as retail market share.
The Radio Business continued to perform exceptionally well in this financial year.
Total income of this division increased from Rs. 1,273 million during the previous year to
Rs. 1,358 million reporting a growth of 6.73%, one of the best among the Radio players.
EBIDTA has decreased by (24.35%) at Rs. 362 million and EBIDTA margin is 27%.
Digital Business
The digital business declined in total income by 6.8% to Rs. 529 million. DB Digital
has a very formidable and strong position in almost 67% of the Indian language media space
in terms of Unique Visitors and Page Views. Dainik Bhaskar and Divya Bhaskar app have
collectively reached 12.3 million app downloads till March 2018.
MAJOR CAMPAIGN / EVENTS DURING THE YEAR
• Launch of a new brand campaign with sharper product promise of "Chalo
Aaj Kuch Achcha Sunte Hai" across stations to engage and strengthen listener connect.
• Extending the "Achcha Sunte hai" promise, MY FM gifted hearing
aids to children (aged 6-8 years) with hearing impairments. This drive was implemented
across Surat, Rajkot and Ahmedabad. An overwhelming number of people responded to MY FM's
call to make a difference.
• Celebrating 10 years of presence in Ahmedabad and Surat, MY FM executed the
biggest Music and Entertainment Festival. More than 25k and 7k people in Ahmedabad and
Surat, respectively, witnessed the event.
• Rangrezz Season 4 - MY FM flagged off India's largest painting competition
across the network. The theme was based on inciting a deep sense of state pride amongst
children, through catchphrases like Incredible Rajasthan, Incredible Gujarat, etc. Over
612 schools and 3 lakh children participated
• Ek Rakhi Fauji Ke Naam campaign in which MY FM RJ asked listeners to send
Rakhis for their bothers in the army; 2,99,446 Rakhis were collected through this
initiative.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
As representative of Dainik Bhaskar group, the Company takes CSR very seriously and
wants to make it a mass movement. With this purpose in mind, your Company has tweaked our
strategy on CSR and now, mostly, adhere to advocacy model. The idea is to concentrate our
efforts on utilizing our extensive reach to put across our CSR messages to as many people
as possible by way of advertisements and write-up.
Company's CSR initiatives are meant to inform, educate and engage the readers to care
from nature, environment and deprived sections. While such initiatives may not show
immediate results but in the long run have great potential to sensitize people and make
them more humane.
Highlights of the Company's overall CSR initiatives during FY 2017-18 were as follows:
• Tilak Holi–Encouraging people to reduce wastage of water, and instead
celebrate holi with natural and dry colours.
• Mitti Ke Ganesh – observing Ganesh Chaturthi using idol made of natural
clay and spread videos teaching how to make the clay idols.
• Sarthak Deepavali–persuading people to make Diwali a true festival of
joy by bringing happiness on faces of those who are deprived.
• Ek Ped Ek Zindagi– appealing people to plant, conserve and preserve
more trees to save environment.
• Jal Satyagrah–Informing people about the scarcity of water and ways to
cut down its wastage.
• Daan Campaign– Urging people to observe Republic Day (26th
January) by donating things which are no longer of use to one, to the needy.
• Save Birds – Appealing people to take care of birds during summer
season by keeping aside food and water for them in pots.
• Live Positive Campaign –driving a whole campaign to discourage students
from committing suicide by roping in coaching institutes and responsible people to become
student buddies.
A brief outline of the CSR policy of the Company and initiatives undertaken by the
Company on CSR activities during the year are set out in "Annexure A" to this
report. For other details regarding the CSR Committee, please refer to the Corporate
Governance Report, which is a part of this report. The CSR policy is available on the
website of the Company.
During the year, the Company incurred an expenditure of
Rs. 45.1 million on CSR activities as against the required spend of Rs. 100.7 million.
The Company could not spend the balance required amount on account of non-availability of
fitting, significant and concrete CSR projects. The Company is committed towards
undertaking additional activities in the areas of promoting education, empowering women,
environmental sustainability, healthcare and sanitation to mention a few and ensure the
remaining amount is spent on tangible CSR activities.
AWARDS AND ACCOLADES
Winning awards is the result of strategic efforts to build a company's authority as an
industry leader and a great opportunity to showcase the excellence standards. Your Company
was conferred with as many as 81 awards during FY 2017-18 under various segments of its
business for its Brand & Marketing Campaigns, CSR Initiatives, Event Activation,
Effectiveness in Publication & Media and Print Innovations, Corporate Collaterals,
Best Use of CSR practices in Media & Entertainment, Public Awareness Programme, etc.
These include 12 Asian Customer Engagement Awards,
9 Public Relation Council of India Awards, 6 India Radio Forum Awards, 4 MarCom
Awards and 3 Summit International Awards.
DIVIDEND
Your Directors have recommended a final dividend @ 10% (i.e. Rs. 1/- per equity share
of the face value of Rs. 10/- each) for the year ended 31st March, 2018 subject
to approval of members at the ensuing Annual General Meeting of the Company.
The total amount of dividend to be paid as Final Dividend is approx. Rs. 18.4 Crore.
DIVIDEND DISTRIBUTION POLICY
As per Regulation 43A of the SEBI Listing Regulations, the Company has framed a
Dividend Distribution Policy which had been approved by the Board of Directors at its
meeting held on 20th October, 2016. The Policy lays down a framework for
considering decisions by the Board of the Company with regard to distribution of dividend
to the shareholders and/ or retaining or plough back of its profits. A copy of the Policy
has been attached as ‘Annexure B' to this report and the same is also available for
viewing on the Company's website and can be accessed at:
http://investor.bhaskarnet.com/files/ Dividend%20Distribution%20Policy.pdf
BUY BACK OF EQUITY SHARES BY THE COMPANY
The members of the Company have approved Buyback proposal for buy-back of up to
92,00,000 fully paid-up equity shares of Rs. 10/- each (being approx. 5% of the total
paid–up equity share capital of the Company as on 31st March, 2018) at a
price of Rs. 340/- per equity share on a proportionate basis through tender offer for an
aggregate amount of
Rs. 312.80 Crore (excluding transaction cost viz. brokerage, applicable taxes such as
securities transaction tax, stamp duty and goods and service tax, etc.). The approval for
Buyback proposal was accorded by the members of the Company by passing the enabling
Special Resolution through Postal Ballot as per statutory requirements in this regard, the
results of which were declared by the Company on 7th July, 2018.
The Company has made the Public Announcement in this regard after compliance with all
the necessary disclosures. The Record Date for determining the eligibility of the
shareholders to participate in the Buyback is set as 18th July, 2018. The
Company will be completing the Buyback within 12 months from the date of Special
Resolution passed approving the proposed Buyback which is 6th July, 2018.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mr. Naveen Kumar Kshatriya, Independent Director of the Company resigned from
directorship on the Board from 30th September, 2017. The Board places on record
its gratitude for the valuable services rendered by Mr. Naveen Kumar Kshatriya during his
association with the Company.
At the Board Meeting held on 16th May, 2018, Mr. Pawan Agarwal (DIN:
00465092), the Deputy Managing Director of the Company was re–appointed for a further
period of five (5) years w, e, f. 31st July, 2018 up to 30th July
2023 subject to members' approval sought at the forthcoming Annual General Meeting along
with an increase in his remuneration from the existing remuneration of Rs. 60 Lakh p.a. to
Rs. 1 Crore p.a. as detailed below.
| PARTICULARS |
Amount in Rs. |
| Basic Pay (Annual) |
1,00,00,000/- |
| Perquisites, Bonus, Commission & other allowances |
Nil |
Pursuant to Section 152 of the Companies Act, 2013 (the "Act") and the
Articles of Association of the Company Mr. Pawan Agarwal, Deputy Managing Director retires
by rotation at the ensuing Annual General Meeting and being eligible offers himself for
re-appointment. He has confirmed that he is not disqualified from being appointed as a
Director in terms of Section 164 of the Act.
A brief resume of Mr. Pawan Agarwal, nature of his expertise in specific functional
areas and names of the Companies in which he holds directorships and / or membership /
chairmanship of committees of the Board as stipulated under SEBI Listing Regulations is
given in the Corporate Governance Report forming part of the Annual Report.
Mr. Sudhir Agarwal has been appointed as the Managing Director of the Company for a
term of 5 years (1st January, 2017 to 31st December, 2021) at a
remuneration of Rs. 90 Lakh p.a. Considering ever expanding business of the Company, the
industry trend as also the business acumen and the vast experience that he possesses, on
recommendation of the Nomination and Remuneration Committee and approval of the Audit
Committee, the Board of Directors at its meeting held on 19th July, 2018 has
increased his remuneration from Rs. 90 Lakh p.a. to Rs. 1.5 Crore p.a. as detailed below
w.e.f.
1st October, 2018, subject to approval of the members of the Company at the
ensuing Annual General Meeting (AGM). Members' approval is sought for the said increase in
his remuneration at the forthcoming Annual General Meeting.
| PARTICULARS |
Amount in Rs. |
| Basic Pay (Annual) |
1,50,00,000/- |
| Perquisites, Bonus, Commission & other allowances |
Nil |
In terms of Sections 149 and 152 of the Companies Act, 2013, it is proposed to
re-appoint the 3 (three) Independent Directors on the Board of the Company. Each of Mr.
Piyush Pandey and Mr. Harish Bijoor are proposed to be re-appointed for the second
consecutive term of 2 years i. e. from 1st January, 2019 till 31st
December, 2020 and Mr. Ashwani Kumar Singhal is proposed to be re-appointed for the second
consecutive term of 5 years i. e. from 1st January, 2019 till 31st
December 2023. Resolutions for appointing them as Independent Directors for second
consecutive term are recommended for passing by the members of the Company at the ensuing
Annual General Meeting. A brief resume of each of these Independent Directors, nature of
their expertise in specific functional areas and names of the Companies in which they hold
directorship and / or membership / chairmanship of Committees of the Board as stipulated
under SEBI Listing Regulations is given in the Corporate Governance Report forming part of
the Annual Report.
The Company has received declarations from the Independent Directors that they meet
with the criteria of independence as laid down under Section 149(6) of the Act and the
SEBI Listing Regulations. The Company has also received a notice under Section 160 of the
Act signifying their candidature for the office of Independent Director.
None of the Non-Executive Directors had any pecuniary relationships or transactions
with the Company which may have potential confiict with the interests of the Company at
large.
BOARD MEETINGS
During the year under review, the Board met 4 (four) times, the details of which are
given in the Corporate Governance Report which may be taken as forming a part of this
Report.
COMMITTEES OF THE BOARD
The Board of Directors functions through the following committees constituted in terms
of the provisions of the Companies Act, 2013 and SEBI Listing Regulations:
| Audit Committee |
Stakeholders' Relationship |
|
Committee |
| Nomination and |
Corporate Social |
| Remuneration Committee |
Responsibility Committee |
| Compensation Committee |
Executive Committee |
The legal provision mandating constitution of Risk Management Committee is not yet
applicable to the Company. The details regarding composition and meetings of these
committees held during the year under review are given in the Corporate Governance Report
which may be taken as forming a part of this Report.
BOARD EVALUATION
The Board has evaluated the performance of each director on the Board based on the
parameters listed out in the ‘Policy on Performance Evaluation of the Board' framed
by the Nomination and Remuneration Committee. The evaluation of the Board and its
Committees has been done by the Board considering the Board dynamics and processes,
contribution towards development of the strategy, risk management, budgetary controls,
receipt of regular inputs and information, functioning, performance and structure of Board
Committees, ethics and values, skill set, knowledge and expertise of Directors,
leadership, etc. A report in brief on Board evaluation has been given in the Corporate
Governance Report which may be taken as forming a part of this Report.
POLICY ON NOMINATION AND REMUNERATION OF DIRECTORS, KMPS AND OTHER EMPLOYEES
The Nomination and Remuneration Committee of the Company leads the process for Board
appointments in accordance with the requirements of Companies Act, 2013, SEBI Listing
Regulations and other applicable regulations or guidelines. As per the policy on
Nomination and Remuneration of Directors, KMPs and Other employees laid down by the said
Committee, all the Board appointments are considered based on meritocracy. The potential
candidates for appointment to the Board are inter alia evaluated on the basis of highest
level of personal and professional ethics, standing, integrity, values and character;
appreciation of the Company's vision, mission, values; prominence in business,
institutions or professions; professional skill, knowledge and expertise; financial
literacy and such other competencies and skills as may be considered necessary. In
addition to the above, the candidature of an Independent Director is also evaluated in
terms of the criteria for determining independence as stipulated under Companies Act,
2013, SEBI Listing Regulations and other applicable regulations or guidelines.
At the meeting of the Nomination and Remuneration Committee held on 16 May, 2018, a
proposal was placed for the re-appointment of three Independent Directors for the second
consecutive term. The Committee has taken into consideration the results of the
performance evaluation of the Directors before recommending their re-appointment to the
members of the Company for approval at the forthcoming Annual General Meeting.
The detailed policy on Nomination and Remuneration of Directors, KMPs and Other
employees is given in the Corporate Governance Report which may be taken as forming a part
of this Report.
EXTRACT OF ANNUAL RETURN
The details prescribed and required under Section 92(3) of the Companies Act, 2013
constituting the extract of the Annual Return is attached as ‘Annexure C' to this
Report.
RISK MANAGEMENT
Your Company is very keen on identifying, evaluating and managing significant risks
faced by the Company and prioritizes relevant action plans in order to mitigate such
risks. Risk management framework is reviewed periodically by the Board and Audit
Committee, which includes discussing the management submissions on risks, evaluating key
risks and approving action, plans to mitigate such risks.
The risk management framework adopted and implemented by the Company is given in the
Corporate Governance Report which may be taken as forming a part of this Report.
INTERNAL CONTROL SYSTEM AND ITS AQEQUACY
Your Company has built up a strong and efficient internal control mechanism which is
commensurate with the size of its business operations. It has laid down standard operating
guidelines and processes which ensure smooth functioning of activities and zero ambiguity
in the minds of people who actually execute the operations.
State Heads and Corporate Finance Heads are accountable for financial controls. They
are fully responsible for accuracy of books of accounts, preparation of financial
statements and reporting in line with the Company's accounting policies. DBCL has deployed
a vigorous Internal Controls and Audit Mechanism to facilitate an accurate and fair
presentation of its financial results. This process not just ensures adherence to
regulatory standards and meets statutory compliance requirements, but also confirms that
our reporting is complete, reliable and understandable. In addition, there is a specific
impetus on safeguarding investor interests with deployment of the highest levels of
governance and regular communication with them.
Over the years, DBCL has undertaken specific efforts to build up its Processes and
deploy Standard Operating Guidelines across all operational areas.
During FY 2017-18, the Company appointed Independent Chartered Accountancy firms to
assist in re-evaluating and testing its Internal Financial Controls (IFC) which
encompassed review, reclassification and rationalization of controls.
To build and/or strengthen its Internal Audit structure, the Company has engaged
experienced Chartered Accountancy firms across all locations. A system of monthly Internal
Audit reporting, reviewing and monitoring together with Surprise Audits is set to ensure
effective adherence to established processes, internal controls and internal audit
mechanism on real-time basis.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
Integrity and ethics have been the bedrock of the Company's corporate operations. There
is no shortcut to integrity. Your Company is committed to conducting its business in
accordance with the highest standards of professionalism, honesty and ethical behavior. It
has the best systems in place to nurture as honest and ethical working culture.
Your Company is among the first few companies in India to take active steps towards
establishing a ‘Whistle-blowing Mechanism'. This initiative was taken to encourage
employees to report irregularities in operations, besides complying with the statutory
requirements under Companies Act, 2013.
In order to maintain highest level of confidentiality, the Company has outsourced the
complaint receiving mechanism and coordination with the whistle blower to an independent
agency. All DBCL employees can avail this mechanism on a daily basis through a dedicated
toll-free Hotline, Website, Email or Post. These reporting channels can be accessed in
Hindi, English, Marathi and Gujarati. The whistle blower is provided with a reference
number by the Agency, for providing additional information and knowing the status of
complaint.
An Internal Ethics Committee has been established to operate this mechanism under the
supervision of the Audit Committee. An ombudsperson along with the Ethics Committee
decides the future course of action. Complaints are categorized and prioritized based on
their nature and actions are commensurate with the category and priority. If the whistle
blower is not satisfied with the actions taken, the mechanism also has an Escalation
Protocol in place. Through the process, the mechanism considers and extends complete
protection to the whistle blower.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
Particulars of loans and guarantees given and investments made under Section 186 of the
Companies Act, 2013 have been given separately in the financial statements of the Company
under Note 31 in the Notes to Accounts, which may be read in conjunction with this Report.
TRANSACTIONS WITH RELATED PARTIES
All related party transactions entered into during the financial year were at arm's
length terms. Also, there have been no materially significant related party transactions
that were entered into by the Company with its related parties. Hence, the Company is not
required to attach the prescribed Form AOC – 2 to the Annual Report of the Company.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirements under Section 134(3)(c) of the Companies Act, 2013 with
respect to Directors' Responsibility Statement, it is hereby confirmed:
1. that in the preparation of the annual accounts for the year ended 31st
March, 2018, the applicable accounting standards have been followed along with proper
explanation relating to material departures;
2. that the directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company as at 31st
March, 2018 and of the profit of the Company for the year ended as on that date;
3. that the directors had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the Companies Act, 2013,
for safeguarding the assets of the Company and for preventing and detecting fraud
and other irregularities;
4. that the directors had prepared the annual accounts for the financial year ended 31st
March, 2018, on a ‘going concern' basis;
5. that the directors had laid down internal financial controls to be followed by the
Company and that such internal financial controls are adequate and operating
effectively;
6. that 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.
SUBSIDIARIES
The Company has 2 subsidiaries as on 31st March, 2018. There are no
associate companies or joint venture companies 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.
Pursuant to the provisions of Section 129(3) of the Act, a statement containing the
salient features of financial statements of the Company's subsidiaries in Form AOC-1 is
attached to the financial statements of the Company.
Performance / Business highlights of subsidiaries
The performance / business highlights of the subsidiaries of your Company during the
financial year 2017-18 are as follows:
1. DB Infomedia Pvt. Ltd. (DBIPL)
DBIPL carries on its business in the domain of online digital space. It has recorded
PBT loss of Rs. 4.45 million in the current financial year as compared to PBT Loss of Rs.
24.62 million during the previous financial year 2016-17.
2. I Media Corp Limited (IMCL)
IMCL which is housing the event business of the Company recorded an PBT Loss of Rs.
1.34 million for the year under consideration. This subsidiary functions in co-ordination
with radio division and carries out events across MY FM station cities.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis Report for the year under review as stipulated
under Regulation 34 read with Schedule V of the Listing Regulations is given separately
which may be taken as forming a part of this Report.
REPORT ON CORPORATE GOVERNANCE
A report on Corporate Governance as stipulated under Regulation 34 read with Schedule V
of the Listing Regulations is given separately which may be taken as forming a part of
this Report. A Certificate, as prescribed, from the Auditors of the Company, confirming
compliance with the provisions of Corporate Governance is attached to the said Report.
BUSINESS RESPONSIBILITY REPORT
A report on Business Responsibility as stipulated under Regulation 34 of the Listing
Regulations is given separately which may be taken as forming a part of this Report.
EMPLOYEES' STOCK OPTION SCHEMES
The Company had granted Stock Options to its employees under the ‘DBCL – ESOS
2010' and ‘DBCL – ESOS 2011' (Tranches 1 to 6). The Compensation Committee of
the Board of Directors, constituted in accordance with the SEBI Guidelines, administers
and monitors these schemes. The stock option schemes are in compliance with Securities and
Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 ("Employee
Benefits Regulations") and there have been no material changes to these schemes
during the financial year.
The details required to be disclosed in terms of Regulation 14 of the Employee Benefits
Regulations are placed on the Company's website and can be accessed at: http://investor.
bhaskarnet.com/pages/corporategovernance.php
Your Company has obtained a certificate from the Auditors certifying that the said
Employee Stock Option Schemes have been implemented in accordance with the Employee
Benefits Regulations and the resolutions passed by the members in this regard. The
Certificate will be placed at the Annual General Meeting for inspection by the members, as
prescribed which is also attached to this Report.
STATUTORY AUDITORS
At the previous Annual General Meeting (AGM) of the Company held on 4th
September, 2017 M/s. Price Waterhouse Chartered Accountants LLP (Firm Registration No.
012754N/ N500016) and M/s. Gupta Mittal & Co. (Firm Registration No. 009973C) were
appointed as the Joint Statutory Auditors of the Company for a period of 5 (Five) years
till the conclusion of 26th Annual General Meeting of the Company (subject to
ratification by the shareholders at every Annual General Meeting, as prescribed at that
time).
However, during the year under review, the Parliament of India has enacted The
Companies (Amendment) Act, 2017; whereby ratification of auditors at every AGM under
Section 139(1) has been done away with. Due to the enforcement of this amendment by the
Ministry of Corporate Affairs during the year, it is no longer necessary to seek
ratification of the appointment of the Auditors by the shareholders at every AGM
henceforth.
However, the Board wishes to inform the shareholders that the Statutory Auditors viz.
M/s. Price Waterhouse Chartered Accountants LLP and M/s. Gupta Mittal & Co. have
confirmed that their appointment is still within the prescribed limits under Section 139
of the Companies Act, 2013 and that they are not disqualified for holding such position of
auditorship within the meaning of Section 139 of the said Act.
Auditors' report
The Auditors' Report on the Financial statements of the Company for the financial year
2017-18 does not contain any qualifications, reservations, or adverse remarks.
SECRETARIAL AUDITOR
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company
has appointed M/s. Makarand M. Joshi & Company, a firm of Company Secretaries in
Practice to undertake the secretarial audit of the Company.
Secretarial Auditors' report
The Secretarial Audit Report given by the Secretarial Auditor viz. Makarand M. Joshi
& Co., Practising Company Secretaries, Mumbai is attached as ‘Annexure D' to this
Report.
The Secretarial Auditors have observed that there were few lapses of code of conduct
under Insider Trading Regulations during FY 2017-18 for which company is in the process of
taking appropriate actions.
COST AUDITOR
Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost
Records and Audit) Rules, 2014, as amended, the cost accounting records maintained by the
Company in respect of its radio business are required to be audited. The Board of
Directors had, on the recommendation of the Audit Committee, appointed M/s. K. G. Goyal
& Associates, Cost Accountants (Firm Registration No. 000024) to audit the cost
accounting records of the Company for the financial year 2017- 18 at a remuneration of Rs.
25,000/- p.a. plus applicable taxes.
M/s. K. G. Goyal & Associates, Cost Accountants are also re-appointed by the
Company as Cost Auditors for the FY 2018-19 at the same remuneration. As required under
the Act, the remuneration payable to the cost auditor is required to be placed before the
members in a general meeting for their ratification. Accordingly, a resolution seeking
member's ratification for the remuneration payable to M/s. K. G. Goyal & Associates
for FY 2018-19 is included in the Notice convening the Annual General Meeting.
PUBLIC DEPOSITS
During the year under review, your Company has not accepted or invited any deposits
from public within the meaning of Chapter V of the Companies Act, 2013 and applicable
rules made there under or any amendment or re-enactment thereof.
PARTICULARS OF REMUNERATION TO EMPLOYEES
The particulars of remuneration to directors and employees and other related
information required to be disclosed under Section 197(12) of the Companies Act, 2013 and
the Rules made thereunder as amended up to date, are given in ‘Annexure E' to this
Report.
PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN
EXCHANGE EARNINGS AND OUTGO
A. CONSERVATION OF ENERGY
(I) Steps taken or impact on conservation of energy:
The Company has continued its efforts to improve energy efficiency measures with more
vigour and gravity. Steps undertaken during the year to conserve energy include:
1. Conducted energy audits at different locations for optimizations of power cost.
2. Post implementation of recommendations derived from the above said energy audit at
13 print locations, the Company has managed to achieve energy savings of 987172 KWH in the
FY 2017-18, despite an increase in print activity.
3. Energy Cost Optimization through conversion from conventional to LED Light, arrested
all air leakages and installed VFD on K35 press & air compressors at MP Printer,
Noida.
(II) Steps taken by the Company for utilising alternate sources of energy:
1. Implemented a Solar PV plant installation at one of its premium locations, which is
likely to be operational soon.
2. GMG Ink Optimization Application installed - PAN India
3. Migration from LPG to PNG for Fuel cost optimization at MP Printer, Noida
(III) Capital investment on energy conservation equipments:
During the year, the Company has invested Rs. 1.011 million on procurement and
installation of branded LED Lights across the Company's various locations.
B. TECHNOLOGY ABSORPTION
Efforts made towards technology absorption and Benefits derived like product
improvement, cost reduction, product development or import substitution:
1. Conservation of water and energy.
2. No disposal of polluting effiuents to mother earth.
In case of imported technology (imported during the last 3 years reckoned from the
beginning of the financial year):
Nil / Not Applicable
Expenditure on R & D:
Nil
C. FOREIGN EXCHANGE EARNINGS AND OUTGO
Your Company earned Foreign Exchange of Rs. 380 million (Previous Year Rs. 391
million). The financial expenses in foreign exchange during the year was Rs. 13.5 million
(Previous Year Rs. 15.7 million) and on account of advertisement, travelling,
maintenance and other expenses was Rs. 37 million (Previous Year Rs. 115 million).
DEMAT SUSPENSE ACCOUNT
During the year under review, the Company has transferred to the IEPF Suspense Account
a total of 2,868 shares on which no dividend had been claimed for seven (7) consecutive
years. Out of these 2,868 shares, 217 shares of 5 shareholders that were lying in Demat
Suspense Account of the Company as on 31st March, 2017 since the Initial Public
Offer of the Company in January, 2010 were also transferred to the IEPF Suspense Account
as mandated under IEPF rules.
Shareholders are requested to note that even after the transfer to IEPF as abovesaid,
the unclaimed dividend amount and the shares transferred to IEPF Suspense Account, both,
can be claimed by making an online application in Form IEPF-5 and sending the physical
copy of the same duly signed (as per registered specimen signature) along with requisite
documents enumerated in the said Form IEPF-5 to the Company at its registered office or to
the RTA.
The IEPF Rules and the application form (Form IEPF-5), as prescribed by the Ministry of
Corporate Affairs, are available on the website of the Ministry of Corporate Affairs at
www. iepf.gov.in.
INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
Pursuant to the applicable provisions of the Companies Act, 2013, read with the IEPF
Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("the rules"),
all the unpaid or unclaimed dividends are required to be transferred by the Company to the
IEPF established by the Central Government, after the completion of seven years.
Further, according to the said Rules, the shares in respect of which dividend has not
been paid or claimed by the shareholders for seven consecutive years or more shall also be
transferred to the demat account created by the IEPF Authority. Accordingly, the Company
has transferred such shares to IEPF Authority. The Company will continue to transfer such
unclaimed dividend and corresponding shares to IEPF Authority as mandated in future the
details of which will be provided on its website viz. www.bhaskarnet.com.
GENERAL
Your Directors state that no disclosure is required in respect of the following matters
as there were no transactions in relation thereto, during the year under review:
1. Issue of equity shares with differential rights as to dividend, voting or otherwise.
2. Issue of sweat equity shares.
3. Non-exercise of voting rights directly by the employees in respect of shares
purchased under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) of
Companies (Share Capital and Debentures) Rules, 2014.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS
There are no significant and material orders passed by the Regulators / Courts /
Tribunals which would impact on the going concern status of the Company and its future
operations.
POLICY REGARDING PREVENTION OF SEXUAL HARRASSMENT AT WORK PLACE
The Company has constituted an Internal Complaints Committee (ICC) which looks into
complaints of sexual harassment. The victim or a person on victim's behalf may lodge a
formal complaint by writing a mail to icc@dbcorp. in / dbcorp@intouch-india.com or by
calling on the hotline number 18001032931.
During the year only one complaint was received by the Company on 20 March, 2018 which
was attended to and closed on priority in April, 2018.
No. of complaints received during the year: 1
No. of complaints disposed off: Nil
No. of complaints pending at the end of the year: 1 (which was disposed off in April,
2018)
HUMAN RESOURCES AND INDUSTRIAL RELATIONS
People Connect:
Your Company fosters a culture of employee and their family wellbeing by offering
various types of policies and employee benefits. Policy on Hiring of Relatives of
Employees, Re-hire policy, Salary Advance Policy, Ramesh Chandra Agarwal Scholarship,
Saubhagyawati Bhav (Marriage assistance for employee's daughter), Shubh Laxami (good
gesture on birth of baby girl), Sparsh (good gesture on birth of baby boy), Employee Group
Mediclaim Insurance, Group Personal Accident Policy, Mediclaim for Parents &
Parents-in-law, Aapaat Nidhi are some of them.
Highlights of some of these policies are given below:
• Ramesh Chandra Agarwal Scholarship is for the children of employees drawing
salary upto Rs. 30000 per month and have worked in the organisation for two years and
more. This is bestowed as a onetime scholarship of Rs. 1 lakh for the meritorious girl
child of the employees who scores more than 90% marks in class 12th exam and as
a onetime scholarship of Rs. 30,000 for the meritorious children of the employees who
score more than 86% marks in class 12th exam.
• Sukanya Samridhi account for the children of employees drawing salary upto
Rs. 30,000 per month and have worked in the organisation for five years and more : Company
helps in opening Sukanya Samriddhi account (as per Government scheme by this name) by
giving
Rs. 31,000 on the birth of girl child of the employees.
• Aapaat Nidhi : An exigency fund is maintained to support the employees and
their families in any medical exigency and death of an employee.
With emphasise on people care, the company's motto "DB Cares" is proved when
the company offers some unique benefits for its employees and their families in the form
of the above-mentioned policies. The management believes that family's happiness leads to
more productive and engaged employee.
Employee Empowerment:
The Company has conceptualised and implemented various human resource policies towards
betterment of its over 11,000 employees. These include Talent Attraction and acquisition
policy, Centralised Induction & On-boarding policy, Performance Management System,
Career & Succession Planning, Potential to Growth (P2G) policy amongst others.
The Company provides a culture of freedom for the employees where an employee is able
to speak his / her mind for the organizational improvements. The Leaders conduct
"Let's Chat" meetings to provide a platform to the team where they can share
their concern and get solutions.
Year 2017-18 witnessed our journey from PeopleSoft to SuccessFactors as HRIS tool. The
system is an automated interface helping the employees as well as the Managers for their
attendance, salary, performance appraisal, productivity, dashboard etc.
The Company places a strong emphasis on the work ethics in order to foster a healthy
corporate culture in the Company. It has always believed in adhering to the best
governance practices to ensure protection of its stakeholders' interests in tandem with
healthy growth of the Company. With this belief, the Company has adopted a Code of Conduct
which extends to all its Board Members and Senior Management personnel. Additionally, the
Company has framed a policy which deals with Code of Conduct by all the employees across
the levels, including its subsidiaries. The Code intends to forbid any activity /
association / relationship by Directors / employees which is detrimental to the Company's
interest.
The corporate governance framework is further supported by a Whistle Blower Policy
which serves as a mechanism for its directors and employees to report genuine concerns
about unethical behaviour, actual or suspected fraud or violation of the Code of Conduct
without fear of reprisal. The complainant can blow the whistle by calling on hotline
number 18001032931 or sending a mail to dbcorp@intouch-india.com.
Company has also formed an Ethics Committee to work towards identifying quick and
consistent actions and timely closure of complaints received and investigated by vigilance
department.
ACKNOWLEDGEMENTS
Your Directors take this opportunity to express their thankfulness and profound
gratitude to the Shareholders, Banks, Financial Institutions, Clienteles, Vendors, Central
/ State Governments and other governing authorities; for their support, continued backing,
co-operation and guidance.
| For and on behalf of the Board of Directors of |
|
| D. B. Corp Limited |
|
| Sudhir Agarwal |
Pawan Agarwal |
| Managing Director |
Dy. Managing Director |
| DIN: 00051407 |
DIN: 00465092 |
| Place: Mumbai |
|
| Date: 19th July, 2018 |
|
| Encl.: Annexure A to E |
|
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