Apollo Sindoori Hotels Ltd Directors Report.

Your Directors are pleased to present the Twenty-Second Annual Report on the business and operation of the Company together with the Audited Financial Statements for the year ended 31st March 2020.

1. Corporate Overview:

Apollo Sindoori is a leading hospitality service management and support services company. We manage the entire gamut of hospitality services right from food services to kitchen planning and management. Apollo Sindoori has built its heritage by combining its corporate and professional prowess with experience and expertise in catering and hospitality. We strive constantly to achieve "Excellence in Hospitality".

2. Operations / State of the Companys Affairs:

Your Companys revenue from operation has increased to Rs.191 Crores in Financial Year 2019-20 from Rs.169 Crores in FY 2018-19. This growth in challenging circumstances is a testimony to the robustness of your Companys business strategy and innovative service offerings that helped capture new markets.

Your Companys profit before tax stood at Rs.13.50 Crore for FY 2019-20 as compared to Rs 13.45 Crores in FY 2018-19.

Financial overview

(i)Standalone Financial (Rs. in Lakhs)

Particulars For the period 01.04.19 to 31.03.20 For the period 01.04.18 to 31.03.19
:lNCOME:
Revenue from operations 18,560.66 16,542.90
Other Income 525.53 355.07
Total Income 19,086.19 16,897.97
EXPENDITURE:
Consumption of Provisions & Stores 6,851.33 5,519.45
Employee benefit expense 9,436.76 8,609.93
Finance Cost 70.19 9.72
Depreciation and amortization expense 233.32 96.58
Other expenses 1,143.80 1,316.76
Total Expenses 17,735.40 15,552.44
Profit before exceptional and extraordinary items and tax 1,350.79 1,345.53
Exceptional Items - -
Profit before extraordinary items and tax 1,350.79 1,345.53
Less: Extraordinary Items -
Profit before tax 1,350.79 1,345.53
Tax expense:
(1) (a) Current tax 324.00 398.00
(b) Previous year tax 32.96 0.00
(2) Deferred tax (35.30) (36.15)
Net Profit(Loss) for the period 1,029.13 983.69
Other Comprehensive Income
(i) Items that will not be reclassified to profit or loss
Remeasurement of Defined Benefit Obligation (net of tax) ( 71.52) (5.70)
(ii) Items that will be reclassified to profit or loss
Total Comprehensive Income for the period 957.61 977.98
Earning per equity share:
Weighted average no. of shares outstanding during the period 26,00,400 26,00,400
Nominal Value per Equity Share 5 5
Earnings per share before extra-ordinary item - Basic & Diluted EPS 39.58 37.83
Earnings per share after extra-ordinary item - Basic & Diluted EPS 39.58 37.83

(ii) Consolidated Financial

Particulars For the period 01.04.19 to 31.03.20 For the period 01.04.18 to 31.03.19
INCOME:
Revenue from operations 19,347.70 16,542.90
Other Income 519.77 306.07
Total Income 19,867.47 16,848.97
EXPENDITURE:
Consumption of Provisions & Stores 7,378.07 5,519.45
Employee benefit expense 9,706.40 8,609.93
Finance Cost 141.21 9.72
Depreciation and amortization expense 302.04 96.58
Other expenses 1,450.86 1,316.76
Total Expenses 18,978.58 15,552.44
Profit before exceptional and extraordinary items and tax 888.89 1,296.53
Share of profits of joint ventures 966.68 1,121.37
Exceptional Items
Profit before extraordinary items and tax 1,855.57 2,417.90
Less: Extraordinary Items
Profit before tax 1,855.57 2,417.90
Tax expense:
(1) (a) Current tax 324.00 398.00
(b) Previous year tax 32.96 -
(2) Deferred tax (32.95) (36.15)
Net Profit for the period 1,531.57 2,056.05
Other Comprehensive Income
(i) Items that will not be reclassified to profit or loss
Remeasurement of Defined Benefit Obligation (net of tax) 83.16 (6.94)
(ii) Items that will be reclassified to profit or loss
Total Comprehensive Income for the period 1,448.41 2,062.99
Earning per equity share:
Weighted average no. of shares outstanding during the period 26,00,400 26,00,400
Nominal Value per Equity Share 5 5
Earnings per share before extra-ordinary item
- Basic & Diluted EPS 58.90 79.07
Earnings per share after extra-ordinary item
- Basic & Diluted EPS 58.90 79.07

As a result of dedicated performance of our team we were able to achieve Rs. 13.50 Crores of profit before tax during the FY 2019-20 with a turnover of Rs. 191 Crores as compared to Rs 13.45 Crores of profit and annual turnover of Rs 169 Crores during FY 2018-19. Company has achieved growth rate of 22% on revenue during the financial year.

3. Change in nature of business:

During the year, the no changes in the nature of business have taken place and Company continues its earlier business and operations.

4. Dividend:

Your Directors recommend a dividend of Rs. 2/- (Rupees Two) per share subject to approval of the members at the ensuing Annual General Meeting.

5. Transfer to Reserves:

The Company does not propose any amount to be transferred to General Reserves out of the current profits.

6. Deposits:

The Company has not accepted any public deposits and as such no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.

7. Listing:

Your Company is listed on National Stock Exchange of India Limited, Mumbai.

8. Share Capital:

The paid up equity share capital as on March 31, 2020 is Rs. 1,30,02,000/- During the year under review, your Company has not issued any shares including Equity Shares with Differential Rights or Sweat Equity. Further, Company has no outstanding Preference Shares or Debenture and has not made any redemption of these.

9. Significant or Material Orders Passed by Regulators/Courts:

During the year under review, there were no significant or material orders passed by the regulators or courts or tribunals impacting the going concern status and Companys operations in future.

10. Material Changes and Commitment affecting financial position:

There are no material changes and commitments, affecting financial position of the Company which has occurred between the end of the financial year of the Company i.e. 31st March 2020 and till the date of this Directors Report. However, the impact of the COVID- 19 pandemic is not fully estimated and ascertained as it continues to impact the business of the Company.

11. Corporate Social Responsibility Report:

Your Company has developed and implemented Corporate Social Responsibility initiatives and has spent approximately Rs. 19,50,000/- approved CSR projects during the period under review.

Report on Corporate Social Responsibility including details as Per Rule 8 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is enclosed with this report as Annexure A.

12. Joint Venture Company:

Your Company has an existing joint venture, namely, Faber Sindoori Management Services Private Limited. The joint venture is with Faber Medi-Serve SDN BHD (FMS). The joint venture exists for setting up a project upon mutually agreed objectives in the domain of bio-medical engineering (maintenance), facility engineering (maintenance), cleansing, housekeeping, janitorial services and hospital support services (other than catering services) and management information services (other than patient information).

Your Company holds 49% in Faber Sindoori Management Services Private Limited and balance 51% is held by FMS. Details of the joint venture is provided in AOC-1 in Annexure- B.

13. Subsidiary:

During last financial year, your company had incorporated a wholly owned subsidiary namely Olive & Twist Hospitality Private Limited on 25th February 2019. The subsidiary has been established with a view to carry on Elite Catering, Convention Centers, Event Management, Cloud Kitchen and Business Centers.

The subsidiary has completed first year of the operation and has made its financial for the first year from 25th February 2019 to 31st March 2020.

Details of the subsidiary is also provided in AOC-1 under Annexure- B.

14. Consolidation of Accounts:

Your Company has prepared Consolidated Financial Statements as per Ind AS prescribed under Section 129 read along with Section 133 and prescribed rules of Companies Act, 2013 . The Consolidated Financial Statements reflect the financial position of the Company, its Subsidiary and Associates. As required by Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (hereinafter referred to as ‘LODR Regulation), the Audited Consolidated Financial Statements together with the Independent Auditors Report thereon are annexed and form part of this Annual Report.

15. Contract or Arrangement with Related Party:

All contract or arrangement or transection pursuant to such contract or arrangement with related party during the financial year are in the ordinary course of business and on an arms length basis and are on similar terms and conditions as applicable to non-related parties. All the related party transactions are either approved by members or pre-approved by the Audit Committee. Disclosure as required in form AOC-2 has been provided as Annexure- C to this Directors Report.

The details of the transaction with Related Party are also provided in the accompanying financial statements and notes to account as per AS and may be treated as part of Directors Report.

16. Extracts of Annual Return:

The extracts of Annual Return forming part of Directors Report is annexed as Annexure ‘D. A copy of the extract is also available in the website of the company at http://www.apollosindoori.com/pdf/annualreturn.pdf

17. Composition of Board:

The Board of the Company comprises of optimum combination of Executive and Non-Executive Directors and Independent Directors. The Board as on date of the report, has two executive directors, three non-Executive directors and three independent directors.

The composition of the Board is as below:

S.No Name of the Director Designation Executive/ Non-Executive/ Independent
1 Mrs. Sucharitha Reddy Managing Director Executive
2 Mr. C. Natarajan Whole-time Director and Chief Executive Officer Executive
3 Mr. Pottipati Vijaykumar Reddy Director Non- Executive
4 Mrs. Suneeta Reddy Director Non- Executive
5 Mrs. Sindoori Reddy Director Non- Executive
6 Mr. Venkatraman. G Chairman Independent Director
7 Mr. George Eapen Director Independent Director
8 Mr. Suresh Raj Madhok Director Independent Director

18. Attendance of Directors at Board Meetings and Annual General Meeting:

The Board of Directors met four times during the financial year 2019-20 on 30th May 2019, 13th August 2019, 13th November 2019 and 14th February 2020.

Details of attendance of Directors at the Board Meetings held during the financial year 2019-20 and the last Annual General Meeting (AGM) held on 25th July 2019 is as below:

Name of the Director

Attendance at Board Meeting

Attendance at AGM Dated
Held Attended 25th July 2019
Mrs. Sucharitha Reddy 4 3 No
Mr. C. Natarajan 3 3 Yes
Mr. Vijaykumar Reddy 4 3 No
Mrs. Suneeta Reddy 4 3 No
Mrs. Sindoori Reddy 4 3 No
Mr. Venkatraman. G 4 4 Yes
Mr. George Eapen 4 4 Yes
Mr. Suresh Raj Madhok 4 4 Yes

19. Committees of Board:

Your Board has constituted Four Committees in compliance to Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations) namely, Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee and CSR Committee. Board also ensures meeting of Independent Director in compliance to the provision.

During the financial year 2019 -20, following meeting of Committees were held:

(i) Audit Committee met four times on 30th May 2019, 13th August 2019, 13th November 2019 and 14th February 2020.

(ii) Nomination & Remuneration Committee met twice on 13th November 2019 and 14th February 2020.

(iii) Stakeholders Relationship Committee met once on 14th February 2020.

(iv) CSR Committee met twice on 30th May 2019 and 14th February 2020.

(v) Independent Directors met once on 30th May 2019.

Details of attendance of Directors at the Committee Meetings held during the financial year 2019-20 is as below:

Name of the Director

Attendance at Committee Meeting

Attendance at Independent
Held Attended Directors Meeting
Mrs. Sindoori Reddy 3 3 -
Mr. Venkatraman. G 9 9 Yes
Mr. George Eapen 10 10 Yes
Mr. Suresh Raj Madhok 8 8 Yes

19 a. Audit Committee:

Company has Audit Committee in compliance to the Section 177 of Companies Act, 2013 and SEBI (LODR) Regulations, 2015. There were no such incidences where the Board has not accepted the recommendations of the Audit committee during the year.

The details about composition of the Audit Committee, its terms of reference, meetings, attendance, etc. have been provided in the Corporate Governance Report forming part of the Directors Report.

20. Nomination & Remuneration Committee:

Company has Nomination and Remuneration Committee in compliance to the Section 178 of the Companies Act, 2013 and SEBI (LODR) Regulation, 2015. The Company strongly believes that human resources which manage the other resources have infinite potential and therefore, their development is the key to organizational effectiveness. The Company commit to integrate human resources with organizational growth and development for mutual benefit.

The details about composition of the Nomination and Remuneration Committee, its terms or reference, meetings, attendance and all other details have been provided in the Corporate Governance Report forming part of the Directors Report.

21. Stakeholders Relationship Committee:

Company has Stakeholders Relationship Committee in compliance to the Section 178 of the Companies Act, 2013 and SEBI (LODR) Regulation, 2015. The Committee has been constituted to specifically look into various aspects of interest of shareholders, debenture holders and other security holders and resolve the grievances of security holders.

The details about composition of the Stakeholders Relationship Committee, its terms or reference, meetings, attendance and all other details have been provided in the Corporate Governance Report forming part of the Directors Report.

22. Corporate Social Responsibility Committee:

Company has Corporate Social Responsibility (CSR) Committee in compliance to the Section 135 of the Companies Act, 2013.

The details about composition of the CSR Committee, meetings and attendance have been provided in the Corporate Governance Report forming part of the Directors Report.

23. Conservation of Energy, Technology Absorption, Foreign exchange Earnings and Outgo

(i) Conservation of Energy:

The Company values the significance of conservation of energy and hence continuous efforts are made for judicious use of energy at all levels of operations by utilizing energy efficient systems and processes. Towards achievement of this objective, steps have been initiated including use of energy efficient LED lights and energy management systems at our kitchen/offices. Further, certain initiatives are being implemented for optimization of electricity and LPG usage.

Some of the actions planned in phase number include replacement of energy intensive pumps with high efficiency

systems, replacement of energy intensive fans with energy efficient fans. Operational measures include close monitoring and control of energy consumption and frequent energy audits by the hotel Engineering Department.

Your Company remains focused on giving importance towards conservation of energy, which results in savings of electricity consumption, a significant component of the energy cost, in an ongoing process. Company has not made any specific estimate of capital investment for energy conservation equipment.

(ii) Technical Absorption:

The Company continues to absorb and upgrade modern technologies and advanced hotel management techniques in various guest contact areas, which includes wireless internet connectivity in all the Guest House.

The company has not imported any technology in last three years. Further, Company has not incurred any expenditure on research and development.

(iii) Foreign Exchange Earnings and outgo:

Foreign Exchange earned in terms of actual inflows and the Foreign Exchange outgo in terms of actual outflows during the year is as under:

Particulars As at 31 Mar 2020 (Rs.) As at 31 Mar 2019 (Rs.)
Outgo 16,03,993 27,83,105
Earned -- ---

24. Insurance:

All insurable interest of the Company including, buildings, furniture and fixtures and other insurable interest are insured.

25. Auditors:

(i) . Statutory Auditors:

M/s. P. Chandrasekhar LLP, Chartered Accountants, Statutory Auditors of the Company has been appointed at the 19th Annual General Meeting and holds office until the conclusion of 24th Annual General Meeting. As per the amendment effective 7th May 2018 to Section 139 of Companies Act, 2013, the appointment is no more required to be ratified at each Annual General Meeting as required earlier.

(ii) . Internal Auditor:

Pursuant to the provisions of Section 138 of the Companies Act, 2013 and The Companies (Accounts) Rules, 2014, the Company has appointed M/s. Viswanathan & Co, Chartered Accountants as an Internal Auditors to undertake the Internal Audit of the Company.

(iii) . Secretarial Auditor:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed BGSMISHRA & Associates, Company Secretaries LLP as Secretarial Auditor for the financial year 2019-20. The Secretarial Audit Report duly signed by Mr. Gouri Shanker Mishra, Partner, BGSMISHRA & Associates, Company Secretaries LLP. The Report of the Secretarial Auditor is attached. Further, Company has appointed BGSMISHRA & Associates, Company Secretaries LLP to conduct the Secretarial Audit for the financial year 2020-21.

26. Internal Control Systems and their Adequacy:

The Company has an internal control system which commensurate with size, scale and complexity of its operations. Further, Company has appointed an external Internal Auditor. The scope and authority of the internal Audit function is well defined in the organization. To maintain its objectivity and independence, the Internal Auditor reports to the Audit Committee of the Board.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control systems in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal Audit function, process owners undertake corrective action in their respective areas and thereby strengthen the control. Significant audit observations and corrective actions suggested are presented to the Audit Committee of the Board.

27. Directors Responsibility Statement:

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their Knowledge and ability, confirm that:

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(b) They 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 financial year 31st March 2020 and of the profit and loss of the Company for that period;

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

(d) The Annual Accounts are prepared on a going concern basis;

(e) They have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

(f) They have devised proper systems to ensure compliance with the provisions of all applicable laws and these systems are adequate and operating effectively.

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the Internal, Statutory and Secretarial Auditors and external consultant(s) and the reviews made by the Management and the relevant Board Committees, including the Audit Committee, Board is of the opinion that the Companys internal financial controls were adequate and operationally effective during the financial year 2019-20.

28. Directors Appointment / Re-appointment:

In terms of the provisions of Section 152 (6) (d) of the Companies Act, 2013 Ms. Suneeta Reddy and Mr. Vijaya- kumar Reddy, Directors of the Company retires by rotation at this Annual General Meeting and being eligible offer herself for re-appointment.

Further, Company is seeking approval of re- appointment of Mrs. Sucharitha Reddy as Managing Director at this Annual General Meeting for a period of five years from 21st August 2020. The Company is seeking approval of shareholder by way of special resolution as per the provisions of Section 196 read with Schedule V of Companies Act, 2013.

The Board, recommends their re-appointment as Directors and Managing Director.

29. Independent Directors:

Mr. Ganesan Venkatraman, Mr. Suresh Raj Madhok and Mr. Puthen Veetil George Eapen are presently Independent Directors on Board of the Company and has been appointed for a further period of five years on 25th July 2019 at the Twenty-First Annual General Meeting of Company. Their tenure of five years end on 24th July 2024.

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013.

Company pays commission not exceeding 1% of net profit of the Company to the independent directors as approved by Board/ Nomination and Remuneration Committee. The details of the commission paid is also provided in the Directors Report.

Weblink of familiarization programme undertaken for IDs as available in website is http://www.apollosindoori.com/ pdf/independent%20directors.pdf

30. Changes in Key Managerial Personnel:

During the year, there is no change in Key Managerial Personnel. However, Company has appointed Mr. C. Natara- jan, Chief Executive Officer as Whole Time Director and Chief Executive Officer w.e.f. 30th May 2019 and his terms including remuneration have been approved by shareholders at last Annual General Meeting for a period of three years by way of special resolution as per Section 196 read with Schedule V of Companies Act, 2013.

31. Particulars of Loans, Guarantees or Investments:

Company has made investment in Joint Venture and Wholly Owned Subsidiary, details of which is available in the form AOC - 1 provided in Annexure B. Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are provided in the notes to the Financial Statements and may be treated as forming part of the Directors Report.

32. Vigil Mechanism / Whistle Blower Policy:

Pursuant to Section 177(9) and 177(10) of the Companies Act, 2013, the Company has established vigil mechanism for the directors and employees to report genuine concerns. The Board of Directors have adopted Whistle Blower Policy.

The Whistle Blower Policy aims for conducting the affairs in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behavior. Directors and all permanent employees of the Company are covered under the Whistle Blower Policy. The Vigil (Whistle Blower) Mechanism aims to provide a channel to the Directors and employees to report genuine concerns about unethical behavior, actual or suspected fraud or violation of the Codes of Conduct or Policy or ethics.

The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations and in order to maintain these standards, the Company encourages its employees who have genuine concerns about suspected misconduct to come forward and express these concerns without fear of punishment or unfair treatment.

The mechanism provides for adequate safeguards against victimization of Directors and employees to avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases. The said Whistle-Blower Policy has been hosted on the website of the Company and is available at the website at we- blink http://www.apollosindoori.com/pdf/vigil%20mechanism_Whistle%20Blower%20policy.pdf

33. Board Evaluation:

As per provisions of the Companies Act, 2013 and Regulation 17(10) of the LODR Regulations, the evaluation process for the performance of the Board, its committees and individual directors was carried out internally. Each Board member submitted a detailed evaluation form on the functioning and overall level of engagement of the Board and its Committees on parameters such as composition, execution of specific duties, quality, quantity and timeliness of flow of information, deliberations at the meeting, independence of judgment, decision making, management actions etc.

A one-on-one meeting of the individual directors with the Chairman of the Board was also conducted as a part of self-appraisal and peer group evaluation and the engagement and impact of individual directors was reviewed on parameters such as contribution, attendance, decision making, inter-personal relationship, actions oriented, external knowledge, etc. The directors were also asked to provide their valuable feedback and suggestions on the overall functioning of the Board and its Committees and the areas of improvement for a higher degree of engagement with the management. The independent directors met on 30th May 2019 to review the performance evaluation of non-independent directors, Board including the Chairman, while considering the views of the Executive and Non-Executive Directors. The independent directors were satisfied with the overall functioning of the Board, its various Committees and other non-executive and executive directors. The Board expressed its satisfaction with the Evaluation results, which reflects the high degree of engagement of the Board and its Committees with the company and its management.

34. Compliance to Secretarial Standard:

The company has complied with the Secretarial Standards SS-1 and SS-2 issued by the Institute of Company Secretaries of India on Board Meetings and General Meetings.

35. Risk Management Policy:

Risk Management is an integral part of the business process. The risk management process, inter alia provides for review of the risk assessment and mitigation procedure and timely report to the management and review of the identified risks at periodical interval to assess the progress of control measures.

The Audit committee of the Board reviews the risk management efforts periodically. The Committee has formulated a Risk Management Policy. Risk Management Policy of the Company outlines different kinds of risks and risk mitigating measures. The risks are reviewed for the change in the nature and extent of major risks identified since the last assessment. It also provides control measures for risks and future action plans. Your Board is satisfied that there are adequate systems and procedures in place to identify, assess, monitor and manage risks. The Company believes that the overall risk exposure of present and future risks remains within its risk capacity.

36. Receipt of Commission by MD / WTD from Company or Subsidiary:

During the financial year 2019-20, Managing Director / Whole Time Director of the Company has not received any commission from Company or Subsidiary of the Company.

37. Human Resources:

Your Company takes pride in the commitment, competence and dedication shown by its employees in all areas of its business. It considers people as its biggest assets. It has put concerted efforts in talent management and succession planning practices, strong performance management and learning and training initiatives to ensure that your Company consistently develops inspiring, strong and credible leadership. Your Company has a structured induction process at all its locations and management development programs to upgrade skills of managers.

38. Statutory Auditors Report:

The Standalone as well as Consolidated Financial Statements are accompanied with the Statutory Auditors Report. The Auditors Reports do not contain any qualification/ observation. The Auditors Report read with the Notes and Schedules to Accounts forming part of the financial statements are self-explanatory.

39. Secretarial Auditors Report:

A detailed Secretarial Auditors Report is provided in Annexure- E.

The reply to the observation provided in Secretarial Audit Report is as under:

i. Observation: The website of the Company does not contain all the details/ information as required to be provided.

Company Representation: By inadvertent mistake and CoVID pandemics, certain information could not be made available on the website. Further, due to technical issue we could not update all the information on the website. Board has taken note of same and will implement proper system for compliance of same in future and also provide all information.

ii. Observation: The majority of the revenue of the Company is from related party transaction which as per the representation from the Company is in ordinary course of business and on arms length basis.

Company Representation: The Company is providing services to several hospitals and many of them are related party. However, Company is also providing the services to other parties at the same terms as to these related party. However, majority of the revenue is from related party transaction, which is statement of fact and do not point out to any violation. All related party transections are in ordinary course of business and are at arms length basis and are beneficial for the Company.

Further, these related party transections are entered after due approval of Members/ Audit Committee as required under Companies Act, 2013 and LODR Regulation.

iii. Observation: The conditions of the corporate governance has become applicable for the Company as per its audited financial statement dated 31st March 2019 and hence the Company was required to comply with the norms of corporate governance within six months from 31st March 2019 as per proviso to Regulation 15(2)(a) of SEBI (LODR) Regulations, 2015

Company Representation: As per audited financial statement till last financial year ended 31st March 2018, based on the capital and net worth requirement, Company was not required to comply with the condition of Corporate Governance Requirement. However, as per the financial for the year ended 31st March 2019, the net worth of the Company exceeded minimum threshold and requirement of Corporate Governance became applicable to Company and it was required to comply with all the requirement of corporate governance. Your directors are pleased to inform that Company has complied with all the condition of corporate governance as per timeline provided under Regulation 15(2) of LODR Regulations. Like last observation, this is also a statement of fact and do not point out of any violation.

iv Observation: The Company has not properly followed Secretarial Standard in relation to Board, Committee and General Meetings and Minutes and attendances thereat as required to be done under Act.

Company Representation: Due to inadvertent mistake certain Minutes of Board, Committee and General Meeting and Attendance Registers were not entered/ maintained properly and Secretarial Standard has not been fully complied in relation to same. Board has taken note of same and will implement proper system for compliance of same in future .

v Observation: Certain e-forms to be filed by the Company has been delayed and not been filed within the prescribed period under the Act.

Company Representation: Due inadvertent mistake certain e-forms required to be filed was missed out to be filed and could not be filed within required time and got delayed. However, Company has filed all other forms. Board has taken note of same and will implement proper system for compliance of same in future.

40. Managerial Remuneration:

Disclosures pursuant to Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been provided in Annexure F.

41. Disclosure as per Listing Regulations:

Disclosures pursuant to Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 has been provided in Annexure G.

42. Corporate Governance:

Your directors takes the pleasure of informing you that based on audited financial statement dated 31st March 2019, the net worth of the Company reached the threshold as provided under the Regulation 15(2) of SEBI (LODR) Regulations, 2015 and accordingly the norms relating to corporate governance has become applicable to the Company. Accordingly Company has complied with all the norms of the corporate governance within the statutory period of six months.

As per Schedule V of SEBI (LODR) Regulation, 2015, a separate section on corporate governance practices followed by the Company, report on Corporate Governance together, a certificate confirming compliance and CEO/ CFO Certificate on code of conduct and certificate on Corporate Governance forms an integral part of this Directors Report and has been provided in Annexure H.

43. Management Discussion and Analysis Report:

Management discussion and analysis report forming part of directors report pursuant to Regulation 34 read with

Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 has been provided in Annexure I.

44. Particulars of Employees:

The Company has about 4390 employees in its roll. Since employees contribute in achieving the goal of the Company, periodical training programs are carried out to meet the challenges in providing services to the best of Customer Satisfaction.

45. Sexual Harassment of Women at Workplace (prohibition, prevention and redressal) Act, 2013:

The Company has a Policy on Prohibition, Prevention and Redressal of Sexual Harassment of Women at Workplace and matters connected therewith or incidental thereto covering all the aspects as contained under The Sexual Harassment of Women at Workplace (Prohibition, Prevention and Redressal) Act, 2013. During the year under review, the Company has not received any complaints under the Policy.

46. Transfer to Investor Education and Protection Fund:

The disclosure related to Investor Education and Protection Fund (IEPF) has been made in the notice to the Annual General Meeting. It contains details of the transfer of the unclaimed/ unpaid dividend and the corresponding shares, year wise and amount of unpaid/unclaimed dividend lying in the unpaid account, which are liable to be transferred to the IEPF. The details are also available on the website of the Company.

47. Acknowledgement:

Your Directors take this opportunity to thank the Companys customers, shareholders, suppliers, bankers, financial institutions and the Central and State Governments for their unstinted support. The Directors would also like to place on record their appreciation to employees at all levels for their hard work, dedication and commitment.

For and on Behalf of Board of Directors

Place: C h e n n a i Sucharitha Reddy G. Venkatraman
Date : 9th July 2020 Managing Director Chairman