L&T Technology Services Ltd
Chairman Speech
Dear Shareholders,
This was a landmark year at LTTS. We achieved the milestone of a billion dollars in
revenue run rate, surpassed Rs. 1,000 crore in annual profits, crossed 1,000 patent
filings, and closed our largest acquisition to date. What makes our achievements even more
special is that these were attained in a year that continued to be defined by
geo-political uncertainties and supply chain challenges across geographies and industries.
I take this opportunity to thank our customers, shareholders, employees, and all key
stakeholders for their continued trust and faith in Team LTTS as we continue to engineer
sustainable growth journeys.
The accomplishments during the year reaffirm our position as the industry bellwether,
and bear witness to LTTS' continued commitment toward expanding and deepening our
offerings and capabilities across the global technology landscape.
The record-setting performance during the year can be attributed to the combination of
our robust innovation capabilities with a core Engineering DNA - a major differentiator
and enabler in a rapidly evolving global landscape. This belief in a technology-defined
future is driven by our 6 Big Bets: Electric Autonomous and Connected Vehicles, Nex-Gen
Comms, AI & Digital Products, Digital Manufacturing, MedTech, and Sustainability. Our
focus on each of these strategic areas has not only helped us deliver industry-leading
performance across each of our five verticals, but also strengthened our commitment
towards delivering a profitable, sustainable, and inclusive growth paradigm.
Celebrating Performance and Consistency: Our Industry Defining Moment
During the year, we continued to redefine the performance paradigms for the pure-play
ER&D industry. Our revenues for the year were at $ 990 million, a growth of 16% in
constant currency, led by broad-based double digit performance across each of the key
geographies - North America, Europe, India, and Rest of the World (RoW). In terms of
vertical-wise growth, the Transportation segment led the trajectory, followed by Plant
Engineering, Industrial Products, Medical Devices, and Telecom & Hi-tech.
Annual EBIT margin for the fiscal was the highest ever at 18.5%, driven by our focus on
building a robust and sustainable operating model. The strong revenue growth and
operational performance led to a 22% rise in PAT to Rs. 1,170 crore. Over the last
5 years, our PAT has continued to grow at a stellar 18% CAGR through a combination of
steady expansions and rising operating margins. We further improved ROE to 26% for the
year - again on the back of consistent PAT growth.
The confidence of customers in your Company's capabilities and offerings was further
reflected in the number and size of
We achieved the milestone of a billion dollars in revenue run rate, surpassed Rs.
1,000 crore in annual profits, crossed 1,000 patent filings, and closed our largest
acquisition to date.
deal wins across geographies. During this past year,
LTTS closed 18 deals in the greater than $ 10 million TCV range. Of these, three
engagements were in the $ 40-60 million TCV bracket, while four were in the $ 15 million
TCV category. Looking ahead, we are witnessing significant traction across segments and
geographies, with a robust large deal pipeline around energy transition and
electrification, digital and new-age technologies, and a growing global demand for
business transformation services to optimize costs.
On the back of this robust performance, the LTTS Board of Directors have seen it fit to
declare a final dividend of Rs. 30 per share, in addition to an interim dividend of
Rs. 15, totaling Rs. 45 during the year. This is a stellar dividend payout
ratio of 41% for the year - yet another milestone for your Company as we drive ahead
toward the next frontiers of business success.
Innovation continues to be the key to our success paradigm. During the fiscal, we filed
222 patents, taking the total of our patent portfolio to an industry leading number of
1,090. This achievement was particularly special since LTTS has been filing an average of
50 patents every quarter for the past 2 years.
We continue to watch the global landscape closely for identifying and leveraging
opportunities in unlocking new value paradigms for our stakeholders. Your Company's
expanding global footprint, with new centers in Toronto, Canada; Peoria, USA; Krakow,
Poland; and Toulouse, France are a reaffirmation of our commitment in this direction.
LTTS is also leveraging the latest in digital technologies, platforms, and innovations
to drive a sustainable growth model in line with its overall vision statement of
'engineering a sustainable tomorrow through technology and innovation.Rs.
Strengthening Growth Paradigms: LTTS'
6 Dimensional Glide Path
At LTTS, the 6 Dimensional Glide Path forms the core of how we approach the world. As
the industry bellwether, we are committed to ensuring Industry Leading Growth across
geographies, achieving the billion dollar run rate during the year and focusing on 'One
and a Half Billion' run-rate by FY25. Customer Centricity is our guiding light, and
continues to be reaffirmed in our string of multi-million, multi-year deal wins across
emerging technologies, industries, and geographies. People Engagement forms a definitive
part of our initiatives, and the second consecutive year of the Great Place To Work
certification is a testament of our commitment in this direction. As an ER&D services
company, Technology Quotient is a differentiator for LTTS, and our 1,090 plus patents
portfolio and focused initiatives for creating reusable assets underscores our deep-seated
belief in the power of technology. Again, for delivering a Sustainable Operating Model,
our global teams are working toward ensuring first-time-right delivery with predictable
and industry-leading margins, helping drive new investment paradigms as we move ahead on
the road to 'Billion and Beyond.Rs. And finally, on the Environmental, Social, and
Governance, LTTS is committed to its charter as a responsible corporate citizen and
focused on delivering, profitable, sustainable, and inclusive growth for all stakeholders.
We have signed the SBTi charter, and are committed to achieving carbon and water
neutrality in our operations.
Leveraging our 6 Dimensional Glide Path in tandem with our 6 Big Bets focus is proving
to be a major enabler in driving our global footprint, helping position LTTS
advantageously as we harness the dynamics of the evolving scenario.
This continual and incremental transformation is being achieved through a focused
action plan, involving the doubling down on the Big Bets, accelerating organic growth
Amit Chadha, CEO & MD at L&T Technology Services (Left) with Prof. V. Kamakoti,
Director, IIT Madras
avenues, focusing on improving operational parameters and customer satisfaction, and
embracing a deeper yet more expansive employee engagement as a philosophy across LTTS.
LTTS is already investing in the creation of innovative and reusable technology assets,
and I believe that a renewed focus on new patents across industries and technologies would
be a major differentiator.
Project Rendezvous 2.0, ROAR, iSuggest, GEMS, and Hey Buddy are some the latest
initiatives that are helping redefine the employee engagement philosophy at LTTS.
Your Company's leadership team is spearheading these initiatives from the front as we
get back to office and drive an innovative approach toward enhancing employee wellbeing.
The actions we undertake in this direction are defined by the essence of our revitalized
Vision, Mission, and Values, which were announced at the start of the Fiscal. As we
continue to grow beyond our 22,200+ strong global family, multi-layered focused
initiatives across the board will continue to redefine what it means to be a part of the
LTTS journey.
Charting the Future: Preparing for New World Realities
The past couple of years have been about unlocking the synergies between human
resilience and the positive power of technology. As the world came to terms with the
impact of the pandemic, the power of technology to 'do-good' and transform our lives has
been driven home once again. Our analysis of the worldwide business landscape reveals that
the leading global technology giants grew by an average of 30% between CY20 and CY21,
driving up the demand for new avenues of ER&D support. We expect this trend to
continue, with the global ER&D services market, as per data from Zinnov, poised to
exceed $ 2 trillion by 2025.
Healthy tailwinds across the global technology landscape are expected to play a key
role in this direction. For instance, the global EV market grew by 26% over the previous
year, over 500 million new 5G connections were registered, more than $ 900 billion was
invested in energy transition deployment and climate technologies, and the revenue for
MedTech companies grew by over 6% for the fourth consecutive year.
L&T Technology Services Ltd
Directors Reports
Dear Members,
The Board of Directors are pleased to present the 11th Annual Report along
with the Audited Financial Statements of L&T Technology Services Limited ('LTTS' or
'the Company') for the year ended March 31, 2023.
1. FINANCIAL RESULTS:
(Rs. million)
| Particulars |
Standalone |
|
2022-23 |
2021-22 |
| Profit before depreciation,
exceptional and extra ordinary items & tax |
17,599 |
14,334 |
| Less: Depreciation,
amortization and obsolescence |
2,024 |
1,826 |
| Profit/(Loss) before
exceptional items and tax |
15,575 |
12,508 |
| Add: Exceptional Items |
- |
- |
| Profit/(Loss) before tax |
15,575 |
12,508 |
| Less: Provision for tax |
4,471 |
3,323 |
| Profit for the period
carried to the Balance Sheet |
11,104 |
9,185 |
| Add: Balance brought forward
from previous year |
26,786 |
21,235 |
| Less: Dividend paid for the
year (Including Tax deducted at source) |
3,167 |
3,634 |
| Balance to be carried
forward |
34,723 |
26,786 |
2. PERFORMANCE OF THE COMPANY
A. State of Company Affairs
The gross sales and other income for the financial year under review were Rs. 73,138
million as against Rs. 60,274 million for the previous financial year registering an
increase of 21.3%. The profit before tax from continuing operations, including
extraordinary and exceptional items was Rs. 15,575 million and the profit after tax from
continuing operations including extraordinary and exceptional items of Rs. 11,104 million
for the financial year under review as against Rs. 12,508 million and Rs. 9,185 million
respectively for the previous financial year, registering an increase of 24.5% and 20.9%
respectively.
B. Segmental Performance
The Company has five business segments, namely Transportation, Industrial products,
Telecom & Hi Tech, Plant Engineering and Medical Devices. During the year, the
contribution to the revenue from various business segments were as follows:
(Rs. million)
|
Revenue for 2022-23 |
% of overall |
Revenue for 2021-22 |
% of overall |
| Transportation |
23,784 |
33.5% |
18,030 |
30.7% |
| Industrial Products |
15,013 |
21.1% |
12,510 |
21.3% |
| Telecom & Hi Tech |
11,196 |
15.7% |
10,564 |
18.0% |
| Plant Engineering |
12,662 |
17.8% |
10,030 |
17.1% |
| Medical Devices |
8,426 |
11.9% |
7,603 |
12.9% |
| Total |
71,081 |
100.0% |
58,737 |
100% |
The detailed segmental performance is referred to in Note No. 39 of the Notes forming
part of the standalone financial statements.
C. Geographical Performance
The revenue contribution of the Company from various geographies is mentioned herein
below:
(Rs. million)
| Sr. No. |
Geography |
FY 2022-23 |
% of overall |
FY 2021-22 |
% of overall |
| 1. |
North America |
41,061 |
57.8% |
34,170 |
58.2% |
| 2. |
Europe |
12,930 |
18.2% |
10,637 |
18.1% |
| 3. |
India |
10,838 |
15.2% |
9,053 |
15.4% |
| 4. |
Rest of the World |
6,252 |
8.8% |
4,877 |
8.3% |
|
Total |
71,081 |
100.0% |
58,737 |
100% |
D. Capital Expenditure
As on March 31, 2023, the gross fixed and intangible assets including leased assets,
stood at Rs. 17,975 million (previous year Rs. 16,720 million) and the net fixed and
intangible assets, including leased assets, at Rs. 10,195 million (previous year Rs.
10,144 million). Capital Expenditure during the year is Rs. 1,535 million (previous year
Rs. 1,293 million).
E. Subsidiary/Associate/Joint Venture Companies
During the year under review, the name of Graphene Solutions PTE Ltd. was changed to
L&T Technology Services PTE Ltd., with effect from May 20, 2022.
The Company is in the process of incorporating a subsidiary in Poland under the name of
'L&T Technology Services Poland sp. z o.o.Rs. The Company has not infused any capital
till March 31, 2023.
The following is the Group structure of the Company:
* holding in the company - 74%
$ holding in the company - 100%
The Company has formulated a policy on the identification of material subsidiaries in
line with Regulation 16(c) of the Securities & Exchange Board of India (Listing
Obligations & Disclosure Requirements) Regulations, 2015 ("SEBI Listing
Regulations"), as amended, and the same is placed on the website at https://www.ltts.com/investors/corporate-governance.
The Company has 1 material subsidiary viz: L&T Technology Services LLC. Since this
material
subsidiary is not incorporated in India, Secretarial Audit pursuant to Regulation 24A
of SEBI Listing Regulations is not applicable.
Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 ("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.
F. Key Business Development: Acquisition of Smart World & Communication
("SWC") Business of Larsen & Toubro Limited
In January 2023, the Company announced the acquisition of a substantial portion of the
SWC Business of Larsen & Toubro Limited including its employees, assets and
liabilities, licenses, regulatory approvals, permits, contracts as going concern on a
slump sale basis.
This is a progression of its 6 Big Bets strategy, as the Company had identified that
the SWC Business of L&T could potentially open new avenues of growth in 3 of its big
bets i.e., Nex-Gen Comms, Digital Products & AI and Sustainability.
Subsequently, the transaction was completed on April 1, 2023.
G. Management Discussion and Analysis
The Management Discussion and Analysis as required in terms of Regulation 34 of SEBI
Listing Regulations, forms part of the Annual report separately.
3. TRANSFER TO RESERVES
The Company has not transferred any amount to the reserves during the current financial
year.
4. DIVIDEND AND DIVIDEND DISTRIBUTION POLICY
The Board at its meeting held on October 18, 2022, declared an interim dividend of Rs.
15/- (750%) per equity share amounting to Rs. 1,430.60 million (the total payout
including Tax Deducted at Source amounted to Rs. 1,583.67 million). The dividend
was paid on November 10, 2022.
Further, the Board of directors, in its meeting held on April 26, 2023, had recommended
the payment of dividend of Rs. 30/- (1500%) per equity share of Rs. 2/- each
for the financial year ended March 31, 2023. The proposal is subject to the approval of
shareholders at the ensuing Annual General Meeting ("AGM") to be held on July
18, 2023.
The final dividend on equity shares, if approved by the members, would involve a cash
outflow (including Tax Deducted at Source) of Rs. 3,168 million.
The Dividend is based upon the parameters mentioned in the Dividend Distribution Policy
approved by the Board of Directors of the Company which is in line
with Regulation 43A of the SEBI Listing Regulations. The Dividend Distribution Policy
is provided as Annexure 'A' forming a part of this Board's Report and also uploaded on the
Company's website at https://www.ltts.com/investors/corporate-governance.
5. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
There are no amounts that are due to be transferred to IEPF by the Company.
The Company has sent adequate communication to the members whose dividends are
unclaimed, requesting them to provide/update bank details with the RTA/Company, so that
dividends paid by the Company are credited to the investors' accounts on a timely basis.
The Company has sent communication to shareholders holding shares in physical form for
collecting details of their bank account such as Bank name, Bank Branch, MICR number, IFSC
Code for payment of dividend to such shareholders, whose dividend remained unclaimed/
unpaid. The Company hereafter will be crediting the dividend through electronic mode
instead of revalidating and issuing fresh warrants or demand drafts to the shareholders.
Pursuant to the Investor Education and Protection Fund Authority (Accounting, Audit,
Transfer and Refund) Rules, 2016 ("IEPF Rules"), the Company has appointed the
Company Secretary as the Nodal Officer for carrying out the necessary functions under the
applicable provisions of the Act and the rules made thereunder.
Pursuant to the provisions of Section 124 of the Act read with IEPF Rules and relevant
circulars and amendments thereto, the amount of dividend remaining unpaid or unclaimed for
a period of seven years from the due date is required to be transferred to IEPF,
constituted by the Central Government. Further, pursuant to the provisions of IEPF Rules,
all equity shares in respect of which dividend has not been paid or claimed for last seven
consecutive years shall be transferred by the Company to the designated demat account of
the IEPF authority within a period of thirty days of such shares becoming due to be
transferred. Pursuant to Section 124 of the Act, the unpaid dividends that are due for
transfer to the IEPF are as follows:
| Year |
Type of Dividend |
Dividend Per Share (Rs.) |
Date of Declaration |
Due for Transfer on |
| 2016-17 |
Interim Dividend |
3 |
10.11.2016 |
12.12.2023 |
| 2016-17 |
Final Dividend |
4 |
23.08.2017 |
21.09.2024 |
| 2017-18 |
Interim Dividend |
4 |
07.1 1.2017 |
7.12.2024 |
| 2017-18 |
Final Dividend |
12 |
22.08.2018 |
26.09.2025 |
| 2018-19 |
Interim Dividend |
7.5 |
25.10.2018 |
16.12.2025 |
| 2018-19 |
Final Dividend |
13.5 |
20.07.2019 |
25.08.2026 |
| 2019-20 |
Interim Dividend |
7.5 |
18.10.2019 |
8.12.2026 |
| 2019-20 |
Final Dividend |
13.50 |
17.07.2020 |
25.08.2027 |
| 2020-21 |
Interim Dividend |
7.50 |
19.10.2020 |
13.12.2027 |
| 2020-21 |
Final Dividend |
14.5 |
16.07.2021 |
24.08.2028 |
| 2021-22 |
Special Dividend |
10 |
19.10.2021 |
13.12.2028 |
| 2021-22 |
Interim Dividend |
10 |
18.01.2022 |
14.03.2029 |
| 2021-22 |
Final Dividend |
15 |
15.07.2022 |
21.08.2029 |
| 2022-23 |
Interim Dividend |
15 |
18.10.2022 |
13.12.2029 |
6. MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION OF THE COMPANY,
BETWEEN THE END OF THE CURRENT FINANCIAL YEAR AND THE DATE OF THE REPORT
There are no material changes and commitments affecting the financial position of the
Company between the end of the current financial year and the date of this report.
7. SHARE CAPITAL
During the year under review, the Company had allotted 75,975 Equity Shares of Rs. 2
each upon exercise of stock options by the eligible employees under the Employee Stock
Option Scheme - 2016.
As on March 31, 2023, the total paid up equity share capital of the Company was Rs.
21,12,16,284/- consisting of 10,56,08,142 equity shares of Rs. 2/- each, fully paid up.
As on March 31, 2023, Larsen & Toubro Limited, Promoter of the Company holds
7,79,86,899 shares constituting 73.85% of the paid- up share capital of the Company.
8. DEPOSITS
During the year ended March 31, 2023, the Company has not accepted any deposits from
the public falling within the ambit of Section 73 of the Act and the Rules framed
thereunder. Hence, the Company does not have any unclaimed deposits as on the date of the
balance sheet.
9. DEPOSITORY SYSTEM
As the members are aware, the Company's shares are compulsorily tradable in electronic
form only. As on
March 31, 2023, 99.98% of the Company's total paid- up capital representing
10,55,87,489 shares are in dematerialized form. In terms of Regulation 40 (1) of SEBI
Listing Regulations requests for effecting transfer of securities shall be processed only
if the securities are held in the dematerialized form.
Further, with effect from January 24, 2022, all requests for transmission,
transposition, issue of duplicate share certificate, claim from unclaimed suspense
account, renewal/exchange of securities certificate, endorsement, sub-division/splitting
of securities certificate and consolidation of securities certificates/folios will be
processed and mandatorily a letter of confirmation will be issued, which needs to be
submitted to Depository Participant to get credit of these securities in dematerialized
form. Shareholders desirous of using these services are requested to contact RTA of the
company, the contact details of RTA are available on the website of the Company at www.LTTS.com.
Further in adherence to SEBI's circular to enhance the due diligence for
dematerialization of the physical shares, the Company has provided the static database of
the shareholders holding shares in physical form to the depositories which would augment
the integrity of its existing systems and enable the depositories to validate any
dematerialization request.
10. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND
OUTGO
Information as required to be given under Section 134(3)(m) of the Act read with Rule
8(3) of the Companies
(Accounts) Rules, 2014 is provided in Annexure 'B' forming part of this Board's Report.
11. CORPORATE SOCIAL RESPONSIBILITY
The Corporate Social Responsibility (CSR) Committee comprises of 2 Independent
Directors and 1 NonExecutive Director. The CSR Committee comprises of Mr. Sudip Banerjee,
Mr. R. Chandrasekaran and Dr. Keshab Panda as its Members. Mr. Sudip Banerjee is the
Chairman of the Committee.
During the year under review, two meetings of the CSR Committee were held on April 20,
2022 and October 17, 2022.
The disclosures required to be given under Section 135 of the Act read with Rule 8(1)
of the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended from
time to time are provided in Annexure 'C' to the Board's Report.
The CSR Policy Framework is available on the website of the Company at https://www.ltts.com/investors/corporate-
govemance.
The Chief Financial Officer of the Company has certified that CSR funds disbursed for
the projects have been utilized for the purposes and in the manner as approved by the
Board.
12. PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN OR SECURITY
PROVIDED BY THE COMPANY
The Company has disclosed the full particulars of the loans given, investments made or
guarantees given or security provided as required under Section 186 of the Act and
Regulation 34(3) read with Schedule V of the SEBI Listing Regulations and forms part of
the financial statements.
13. RISK MANAGEMENT POLICY
The Risk Management Committee comprises of Mr. R. Chandrasekaran, Mr. Amit Chadha and
Mr. Rajeev Gupta. Mr. R. Chandrasekaran is the Chairman of the Committee.
The Committee is responsible for monitoring and reviewing the risk management plan and
ensuring its effectiveness. The Company has formulated a risk management policy
and has in place a mechanism to inform the Board Members about risk assessment,
including cyber security and ESG risks and minimization procedures and periodical review
to ensure that executive management controls risk by means of a properly designed
framework. The details of the same are given in Annexure 'D' - Report on Corporate
Governance forming part of this Report.
A detailed note on risk management and internal controls with reference to the
financial statement is given under the financial review section of the Management
Discussion and Analysis which forms part of the Annual Report.
14. VIGIL MECHANISM
The Whistle Blower Policy of the Company meets the requirement of the Vigil Mechanism
framework under the Act and Regulation 22 of SEBI Listing Regulations. As per the
provisions of Section 177(9) of the Act, the Company is required to establish an effective
Vigil Mechanism for directors and employees to report genuine concerns.
The details of the same are given in Annexure 'D' - Report on Corporate Governance
forming part of this Report.
15. CHANGES IN DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mr. Abhishek Sinha was re-appointed as Chief Operating Officer & Whole-Time
Director for a period of 3 (Three) years with effect from October 18, 2022, up to and
including October 17, 2025. The same was approved by the shareholders in the 10th
AGM held on July 15, 2022.
Pursuant to the recommendation of the Nomination and Remuneration Committee (NRC), the
Board at its meeting held on April 26, 2023 appointed Ms. Aruna Sundararajan as an
Additional Director in the capacity of Independent Director for a period of 5 years with
effect from April 26, 2023 up to April 25, 2028 which shall be subject to the approval of
the shareholders in the ensuing AGM. Further, on the recommendation of NRC, the Board also
appointed Mr. Alind Saxena as an Additional Director designated as President Sales &
Whole-Time Director for a period of 3 years with effect from April 26, 2023 up to and
including April 25, 2026 which shall be subject to the approval of the shareholders in the
ensuing AGM.
Dr. Keshab Panda, Non-Executive Director, is liable to retire by rotation at the
ensuing AGM and, being eligible, offers himself for re-appointment.
The Company has disclosed on its website https://www.ltts.com/investors/corporate-governance
details of the familiarization programs formulated to educate the Directors
regarding their roles, rights and responsibilities in the Company and the nature of the
industry in which the Company operates, the business model of the Company, etc.
The Board opines that all the Independent Directors on the Board possess integrity,
necessary expertise and experience for performing their functions diligently.
16. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS
During the financial year under review, 6 (six) meetings of the Board of Directors were
held. The details of the meetings are provided in Annexure 'D' - Report on Corporate
Governance forming part of this Board's Report.
17. DISCLOSURE OF REMUNERATION
The details of remuneration as required to be disclosed under the Section 197(12) of
the Act and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, are given in Annexure 'E' forming part of this Board's Report.
The information in respect of employees of the Company required pursuant to Rule 5(2)
and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014, is provided in Annexure 'F' forming part of this Board's Report.
In terms of Section 136(1) of the Act and the rules made thereunder, the Report and
Accounts are being sent to the shareholders excluding the aforesaid Annexure. Any
Shareholder interested in obtaining copy of the same may write to the Company Secretary at
the registered office of the Company. None of the employees listed in the said Annexure is
related to any Director of the Company.
18. COMPANY POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION
The Company has in place a Nomination and Remuneration Committee (NRC) in accordance
with the requirements of Section 178 of the Act read with rules made thereunder and
Regulation 19 of SEBI Listing Regulations.
The details of the same are given in Annexure 'D' - Report on Corporate Governance
forming part of this Board's Report.
NRC has formulated a policy on Director's appointment and remuneration including
recommendation of remuneration of the key managerial personnel and senior management
personnel and the criteria for determining qualifications, positive attributes and
independence of a Director. A copy of the NRC Policy as disclosed on the Company's website
at https://www.ltts.com/investors/corporate-governance is also enclosed to
the Board's Report as Annexure 'G'. During the year under review, the Company amended the
said policy in line with amendments in the Act and SEBI Listing Regulations.
The Committee has formulated a policy on Board diversity.
19. DECLARATION OF INDEPENDENCE OF INDEPENDENT DIRECTORS
The Company has received Declarations of Independence from Independent Directors as
stipulated under Section 149(7) of the Act and Regulation 25(8) of the SEBI Listing
Regulations, confirming that he/she is not disqualified from appointing/continuing as
Independent Director as per the criteria laid down in section 149(6) of the Act and
Regulation 16(1)(b) of SEBI Listing Regulations.
20. DIRECTORS RESPONSIBILITY STATEMENT
The Board of Directors of the Company confirms that:
a. In the preparation of Annual Accounts, the applicable accounting standards have been
followed along with proper explanation relating to material departures;
b. The Directors have selected such accounting policies and applied them consistently
and made judgments and estimates that are reasonable and prudent so as to give a true and
fair view of the state of affairs of the Company at the end of the financial year and of
the profit of the Company for that period;
c. The Directors have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities;
d. The Directors have prepared the Annual Accounts on a going concern basis;
e. The Directors have laid down an adequate system of internal financial control to be
followed by the Company and such internal financial controls are adequate and operating
efficiently;
f. The Directors have devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems were adequate and were operating
effectively.
21. PERFORMANCE EVALUATION OF BOARD, ITS COMMITTEES AND DIRECTORS
The NRC and the Board have laid down the manner in which formal annual evaluation of
the performance of the Board, Committees, Chairman, and individual directors has to be
made.
The Company had engaged an external agency to facilitate the process of annual
evaluation of the performance of the Board, Committees, Chairman, and the individual
directors. The said external agency was responsible to receive the responses from the
Directors, to consolidate and analyze their responses and present the same to the Chairman
of the Nomination and Remuneration Committee. The external agency used its IT platform for
the entire Board evaluation process right from initiation till conclusion in order to
ensure that the entire process is done in a confidential, transparent and independent
manner without the involvement of the Management or the Company's IT system to ensure
unbiased feedback.
All Directors responded through a structured questionnaire giving feedback about the
performance of the Board, its Committees, individual directors and the Chairman.
The questionnaires cover the Board composition, its structure, its culture, its
effectiveness, its functioning, information availability, adequate discussions, etc. These
questionnaires' also cover specific criteria and the grounds on which all Directors in
their individual capacity will be evaluated.
The evaluation of Independent Directors was done by the Board including assessment of
their performance and their independence of management.
The input given by all the Directors was discussed in the meeting of the Independent
Directors held in accordance with Schedule IV of the Act on March 10, 2023. The
performance evaluation of the Board, Committees, Chairman and Directors was also reviewed
by the Nomination and Remuneration Committee as well as in the Board Meeting on the same
day. The Group Chairman had an individual discussion with all the Independent Directors
and the Chairman of the
Nomination and Remuneration Committee also had a discussion with all the Executive
Directors individually. Most of the suggestions from the Board Evaluation exercise have
been suitably implemented such as meetings of Chairman of NRC with individual Directors
and Action Taken Report of Board decisions.
The performance evaluation further included evaluation of Board Members against the
list of core skills/ expertise/ competencies for the effective functioning of the Company.
The names of Directors who have such skills/ expertise/ competence is provided in detail
in Annexure 'D' - Report on Corporate Governance forming part of this Board's Report.
22. AUDIT COMMITTEE
The Company has in place an Audit Committee in terms of the requirements of the Act
read with the rules made thereunder and Regulation 18 of the SEBI Listing Regulations.
The details pertaining to the same have been provided in Annexure 'D' - Report on
Corporate Governance forming part of this Report.
23. STAKEHOLDERS' RELATIONSHIP COMMITTEE
The Company has in place a Stakeholders' Relationship Committee (SRC) in terms of the
requirements of the Act read with the rules made thereunder and Regulation 20 of the SEBI
Listing Regulations.
The details of the same are given in Annexure 'D' - Report on Corporate Governance
forming part of this Board's Report.
24. ADEQUACY OF INTERNAL FINANCIAL CONTROLS
The Company has designed and implemented a process driven framework for Internal
Financial Controls ('IFC') within the meaning of the explanation to Section 134(5(e) of
the Act. For the year ended March 31, 2023, the Board is of the opinion that the Company
has sound IFC commensurate with the nature and size of its business operations which is
operating effectively and no material weaknesses exist. The Company has a process in place
to continuously monitor the same and identify gaps, if any, and implement new and/or
improved controls wherever the effect of such gaps would have a material effect on the
Company's operations.
The Audit committee defines the scope and authority of the Internal Auditor. The
Internal Auditor monitors and evaluates the efficacy and adequacy of the internal control
system in the Company, its compliance, systems, accounting procedures and policies at all
locations of the Company. Based on suggestions from internal auditors, respective
functions take corrective actions or process improvements.
25. COMPLIANCE WITH SECRETARIAL STANDARDS ON THE BOARD AND GENERAL MEETINGS
The Company has complied with Secretarial Standards issued by the Institute of Company
Secretaries of India (ICSI) on Board Meetings and General Meetings.
26. PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Company has constituted an Internal Committee ('IC') - in line with the
requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition &
Redressal) Act, 2013. The IC has been constituted as per the Act, to redress the
complaints received regarding sexual harassment. All employees (permanent, contractual,
temporary, trainees) are covered under this policy.
During the year under review, 1 case of sexual harassment was received on POSH (Policy
on prevention of Sexual Harassment) of Women at Workplace. The same was resolved and
appropriate action was taken by the Company.
Continuous awareness workshops/training programs for employees are conducted across the
Company to sensitize employees to uphold the dignity of their colleagues at workplace
especially with respect to prevention of sexual harassment.
The Company, on the recommendation of Audit Committee, also undertook measures by way
of periodical e-mailers and sessions to create awareness on microaggression.
27. CONSOLIDATED FINANCIAL STATEMENTS
Your Directors have pleasure in attaching the Consolidated Financial Statements
pursuant to Section 129(3) of the Act and Regulation 34 of the SEBI Listing Regulations
and prepared in accordance with the applicable Accounting Standards prescribed by the
Institute of Chartered Accountants of India (ICAI), in this regard.
28. AUDITORS REPORT
The Auditors' report to the shareholders does not contain any qualification,
observation or comment or adverse remark(s).
29. STATUTORY AUDITORS
M/s MSKA & Associates, Chartered Accountants (Firm Registration No. 105047W) were
appointed as Statutory Auditors for a period of 5 continuous years from the conclusion of
10th AGM till the conclusion of 15th AGM of the Company.
The Auditors have confirmed that they have subjected themselves to the peer review
process of Institute of Chartered Accountants of India (ICAI) and hold valid certificate
issued by the Peer Review Board of the ICAI.
The Auditors have also furnished a declaration confirming their independence as well as
their arm's length relationship with the Company as well as a declaration that they have
not taken up any prohibited non-audit assignments for the Company.
The Audit Committee reviews the independence and objectivity of the Auditors and the
effectiveness of the audit process.
Further, in compliance with Section 146 of the Act, the notices of the general meeting
of the Company are also forwarded to the Statutory Auditors of the Company to ensure their
attendance at the AGM of the Company.
The details of the total fees paid by the Company and its subsidiaries and other
relevant details are provided in Annexure 'D' - Report on Corporate Governance forming
part of this Board's Report.
30. SECRETARIAL AUDIT REPORT
The Board had appointed Alwyn Jay & Co., (Firm Registration No. P2010MH21500),
Practicing Company Secretaries, to conduct a Secretarial Audit under the provisions of
Section 204 of the Act for the financial year 2022-23.
The Secretarial Audit Report issued by Alwyn Jay & Co.; Practicing Company
Secretaries is attached as Annexure 'H' to this Board's Report.
The Secretarial Auditor's Report to the shareholders does not contain any qualification
or reservation or adverse remark.
31. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
Pursuant to the amendments in the SEBI Listing Regulations, the Audit Committee has
approved the amendments to the Related Party Transaction Policy and its Guidelines and the
same is disclosed on the Company's website at https://www.ltts.com/investors/corporate-governance.
The Company has a process in place of periodically reviewing and monitoring Related
Party Transactions and all related party transactions were in the ordinary course of
business and at arm's length.
The Audit Committee has approved all the Related Party Transactions for the FY 2022-23
and Omnibus approval of the Audit committee is obtained before the commencement of
financial year for all the transactions for FY 2023-24 as required under the provisions of
Section 177 of the Act.
Further, there are no materially significant related party transactions that may have
conflict with the interest of the Company.
The details of contracts or arrangements entered into with related parties in Form
AOC-2 is provided in Annexure 'I' forming part of this Board's Report.
32. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR
TRIBUNALS
During the year under review, there were no material and significant orders passed by
the Regulators or Courts or Tribunals impacting the going concern status and the Company's
operations in future.
33. ANNUAL RETURN
As per the provisions of Section 92(3) of the Act, the Annual Return of the Company for
the financial year 2022-23 is available on the website of the Company at https://www.
ltts.com/investors/corporate-governance.
34. OTHER DISCLOSURES
1. Corporate Governance Report
Pursuant to Regulation 34 read with schedule V of the SEBI Listing Regulations, report
on Corporate Governance and a certificate obtained from the Secretarial Auditor confirming
compliance, is provided in Annexure 'D' forming part of this Board's Report.
2. Employee Stock Option Scheme
There has been no material change in the Employee Stock Option Scheme - 2016 (ESOP
Scheme - 2016) during the current financial year. The ESOP Scheme -2016 is in compliance
with the Securities and Exchange Board of India (Share based Employee Benefit and Sweat
Equity) Regulations, 2021 ("SBEB Regulations").
The disclosure relating to the ESOP Scheme - 2016 required to be made under the Act and
rules made thereunder and the SBEB Regulations is provided on the website of the Company http://www.ltts.com/investors/.
The Secretarial Auditors' certificate confirming compliance with the Act and the SBEB
Regulations is provided in Annexure 'D' forming part of this Board's Report.
3. Voting Rights
No disclosure is required under Section 67(3)(c) of the Act, in respect of voting
rights not exercised directly by the employees of the Company as the provisions of the
said section are not applicable.
4. Credit Rating
The Company enjoys a good reputation for its sound financial management and the ability
to meet its financial obligations. The Company has received CRISIL AAA/stable and CRISIL
A1+ rating for its long term and short-term financial instruments of the Company,
respectively.
5. Reporting of Frauds
The Auditors of the Company have not reported any instances of fraud committed against
the Company by its officers or employees as specified under section 143(12) of the Act.
6. KYC Registration for Holders of Physical Securities
As per SEBI circular dated November 3, 2021, the Company regularly reminds shareholders
via Annual Report and Postal Ballot communication for updation of their KYC information
with KFin Technologies Limited.
As per SEBI circular dated March 16, 2023 the Company shall be sending individual
notices
to holders of physical securities to furnish their PAN, details of Nomination, Contact
details (viz. address, mobile and e-mail), Bank Account details and specimen signature
("KYC information") to KFin Technologies Limited on or before September 30,
2023. In case the shareholders fail to update KYC Information on or before September 30,
2023, their folios shall be frozen by the RTA as per above SEBI Circular and such
shareholders will be eligible for payment of dividend or lodging any grievance or availing
any service request from the RTA only after furnishing the KYC information as specified
above.
All shareholders of the Company holding shares in physical form are requested to update
their KYC information with KFin Technologies Limited at the earliest. The relevant forms
for updating the KYC information are provided on the website of the Company at https://www.
ltts.com/investors/investor-services.
7. Business Responsibility and Sustainability Reporting
As per Regulation 34 of the SEBI Listing Regulations, a separate section on Business
Responsibility and Sustainability Reporting forms a part of this Annual Report.
8. Statutory Compliance
The Company complies with all applicable laws, rules, and regulations, pays applicable
taxes on time, ensures taking care of all its stakeholders and initiates sustainable
activities and ensures statutory CSR Spend. The Company has an in-house Compliance tool to
monitor all the compliances.
9. MSME
The Ministry of Micro, Small and Medium Enterprises vide their Notification dated 2nd
November 2018 has instructed all the companies registered under
the Act, with a turnover of more than Rupees Five Hundred crore to get themselves
onboarded on the Trade Receivables Discounting system platform (TReDS), set up by the
Reserve Bank of India. In compliance with this requirement, the Company has registered
itself on TReDS through -KredX Early-.
The Company has complied with the requirement of submitting a half yearly return to the
Ministry of Corporate Affairs within the specified timelines.
10. Cost records and audit
Maintenance of cost records and requirement of cost audit as prescribed under Section
148 of the Act are not applicable for the business activities carried out by the Company.
ACKNOWLEDGEMENT
Your Directors take this opportunity to thank the customers, vendors, academic
institutions, Financial Institutions, Regulatory Authorities, Stock Exchanges and all the
various stakeholders for their continued co-operation and support to the Company. Your
Directors also acknowledge the support and co-operation from the Government of India and
the Governments of various countries, the concerned State Governments, other Government
Departments and Governmental Agencies. The Directors appreciate the significant
contributions made by the employees of the Company and its subsidiaries during the year
under review and value the contributions made by every member of the LTTS family globally.
For and on behalf of the Board
| Amit Chadha |
S. N. Subrahmanyan |
| CEO & Managing Director |
Vice Chairman |
| (DIN: 07076149) |
(DIN: 02255382) |
| Place: Mumbai |
Place: Mumbai |
| Date: April 26, 2023 |
Date: April 26, 2023 |