Aptech Management Discussions

Industry overview

The Indian Education industry is one of the largest and fastest-growing industries in the country. It was estimated to be worth US$ 117 billion in FY2020 and is expected to reach US$ 225 billion by FY2025 (Source: IBEF). The industrys growth is driven by factors such as the countrys large and young population, rising disposable incomes, and increasing demand for quality education.

Vocational institutes

The Company operates in the non-formal vocational space. It offers skilling programs across a number of verticals, primarily to first itme job seekers. The industries addressed by the Company are high growth sectors with major skill-gaps and need for large scale employable skilled workforce.

Animation, VFX, gaming & comics sector: The two major brands of the Company cater to the Animation, VFX, Gaming & Comics (AVGC) sector within the larger Media & Entertainment industry. The FICCI - KPMG April 2023 Report "Windows of opportunity" pegs the size of Indian Media & Entertainment industry at Rs. 2.1 trillion in 2022. The AVGC sector was a significant growth driver and contributed Rs. 107 billion (or 5.1%) in terms of size in 2022 after growing at 29% on a YOY basis. The same report also predicts the sector to outpace the industry CAGR of 10.9% by expanding at an average rate of 21.1% between 2022 to 2025. The AVGC Task Force set-up by the Government estimates the sector to grow between 14 – 16% over the next decade, as India emerges as a primary destination for high-end, skill based activities in the sector. The AVGC Task Forces Study report of December 2022 expects the Animation & VFX segments to be the next sunrise sector on the lines of IT-BPM industry and envisions India as one of the leading Gaming markets in the world. The AVGC skilling ecosystem and the break-up of approximately 1,15,000 students trained annually is illustrated below.

Type of institution

# of students
Government Incentivized Institutions 10,000 – 15,000
Vocational Institutes 60,000 – 70,000
Institutes of Eminence 8,000 – 10,000
Higher Education Institutions 18,000 – 20,000



With the Companys AVGC brands contributing more than 40,000 enrolments to this count, it translates to ~35% contribution to the total number of students and 57% - 67% of the vocational institute enrolments. Thus, making the Company a leader in providing skilled workforce to the sector.

Beauty & salon sector: Beauty & Wellness is the second major vertical catered to by the Company. The Beauty & Wellness Skill Sector Councils Skill Gap Study of March 2023 estimates the sector to have grown at a CAGR of close to 18% (23% in organized and 15% in unorganized sector) from 2018 till 2022. In absolute terms, it is estimated to have grown to INR 178,287 crores by 2022 from INR 92,031 crores in 2018. The Beauty & Salon sector, where the Companys trained professionals are generally placed, is expected to have grown from INR 24,514 crores to INR 47,601 crores during the same period. The Beauty & Wellness industry employs close to ~12.4 million people out of which the Beauty & Salon sectors share is 64% making it an employment heavy segment. The industry currently accounts for about 2.5% of the workforce of the country with a GDP share of less than 1%. The organised players in the industry had a share of about 25% in 2020, ~30% at present and are anticipated to contribute ~40% by the end of 2025. Overall, less than 30% of the workforce in the Beauty and Wellness industry had vocational or technical education in 2022. This number falls was under 20% for the unorganised sector. This highlights the need for skilling and vocational education in the Beauty and Wellness industry. The overall workforce requirement of the industry is expected to grow to 26.3 million by 2030 with the Beauty & Salon sector contributing 3/4th of the incremental growth with 10.3 million additional practitioners in the eight years from 2022.

It sector: The Indian IT-BPM industry grew YOY by 8.4% in FY2022-23 to reach a size of US$ 245 billion. The industry was a net hirer in the year 2022-23 with a ned addition of ~3 lakh employees taking the total direct employment within the industry to about 5.4 million people.

Aviation sector: The Indian Aviation sector within the larger Transport industry saw the domestic passenger traffic expand 55 – 60% to 136 million in FY2022-23. The industry that was one of the hardest hit due to the COVID pandemic almost matched the pre-COVID traffic in FY2022-23 and is set to cross the numbers easily in the next financial year.

Ancillary services

The education sector ecosystem includes players that cater to specialised needs adjacent to core service, i.e., teaching/ tutoring/ training learners. The Counselling and Ancillary Services segment covers such offerings and key examples of such offerings are education consultants/ counsellors, library services, technology providers of Learning Management Systems (LMS), School Management Software (SMS), Learning Content Management Systems (LCMS), etc., and Assessment service providers that offer Testing / Evaluation services for various use cases. The Company is a pioneer in the Assessment segment that caters to various recruiters including Central/ State Governments, Public Sector and Private Sector Companies to help them shortlist/ select candidates from a large pool for hiring or promotions using an exam and assists educational institutions to shortlist/ select candidates for course admissions or scholarships by conducting large scale exams. This is a high-growth segment in India due to the number of examinations conducted in the country and the trend towards digitization and outsourcing. The total market size for this segment in India is roughly US$ 1 Billion, however, the addressable market size for the Company will be in 20 – 25% range of the total market size.

Company overview

The Companys business is categorized into two business segments: Retail and Institutional. With its aspiration to be the preferred learning solutions company globally in the non-formal skilling and vocational space, the Company has developed and perfected its business as a ‘Branded Omni-Channel Job-enablement Platform.


Distinct brands catering to specific verticals.


Scalable learning delivered seamlessly through a network of physical learning centres and a digital platform in offline, hybrid and online mode.


Skill-based programs helping students get their first job. A great share of exams conducted by the Company is recruitment tests.


Replicable and scalable business model with benefitting multiple stakeholders with distinct features and capabilities.


The Retail segment of the Company operate learning centres through a network of Business Partners. It offers specific vertical-focused skill-based training programs at the learning centres in a face-to-face, in-class format and hybrid format that also includes a part of the course delivered online. The programs are predominantly focused on helping the student get trained for and supported for placement in their first job. The verticals and skill areas addressed by each of the six brands operated by the Company are detailed below.


Skill areas

Founded Overseas Presence

Arena Animation

Animation, Visual Effects, Gaming, Immersive Media, Digital Media

1996 Yes

MAAC (Maya Academy of Advanced Cinematics)

Animation, Visual Effects, Gaming, Immersive Media, Digital Media

2010 (Acquisition) Yes

Aptech Learning

Software Development, Hardware & Networking, English Language Learning, Financial Administration and Accounting

1986 Yes

Lakm? Academy Powered by Aptech (Partnership with Lakm? Lever Private Limited)

Beauty & Styling courses such as Skin Care, Make- up, Hair Style, Nail Care, Cosmetology

2015 No

Aptech Aviation

Customer Service, Airport Management, Cabin Crew, Ticketing, Hotel Management, Tourism, Retail Store Management, Merchandising, Distribution.

2006 (Acquisition) Yes

Aptech International Preschool

Mother-toddler, Pre-nursery, Nursery, Kindergarten-1, Kindergarten-2, Childcare and Activity centres

2016 Yes

All the brands, except Aptech International Preschool, are focused on job-enablement by offering courses ranging from one week to three years in duration. The Companys Retail learning centres are present in many countries worldwide and the brands enjoy a leadership position in multiple markets. The Companys business model is scalable and asset light as it delivers skilling programs through a network of Business Partner operated learning centres. From the fees paid by the students, the Company retains royalty (a defined % of student fees), courseware, exams, and events related fees and pays the rest to its Business Partners. In addition, the other revenue sources include sign-up (upfront payment) and renewal fees from Business Partners, alliance fees, projects, etc. There are various proprietary and 3rd party software and web platforms being used by the Company catering to students and Business Partners.

Online Varsity:

Online learning platform to access courseware e-books and supplementary out- of-class content by the students.


ERP-like web-based application used by franchisees to manage the complete student lifecycle from a lead to certificate issuance.


A web platform for showcasing student projects, student engagement and running placement process where student, Business Partners, and recruiters can interact.

In addition to its learning centres, the Company has also launched, during the FY2021-22, a completely online platform to deliver courses in Self-paced, Hybrid and Live mode that is branded as ProAlley.


The Institutional segment consists of two main divisions, viz. Assessment & Testing and Training Solutions. Under this segment, the Company offers a comprehensive learning offering to institutional clients such as Corporate (Public and Private), Educational Institutes, Government departments, and quasi-government bodies.

Aptech assessment & testing solutions

for paper-based exams (descriptive Q&A) are the main offerings of this division. The Company also offers Pen & Paper Assessments, Document Digitalisation tool, and Internet-based Evaluation as separate products through this division. Typical use cases of the assessments at institution level are entrance exams, recruitment and screening exams, semester-end exams, competitive/ scholarship exams, and corporate evaluations, which are amenable to multiple-choice answer format. The Company has capabilities to offer an end-to-end solution to clients with its proprietary IT platforms. The Company has capability to deliver high volume, high stake, multi-shift exams across the country. It is one of the leading players in this space based on its market share and its capacity to handle the number of concurrent nodes in a single shift.

Aptech training solutions

The Training Solutions division offers large, multi-location training rollouts for institutional clients. The training programs may cover IT, Soft Skills, and Customer Service training for lower- to middle-management or channel staff. It also offers Learning Management Solutions (LMS) tools.


Retail Key initiatives gaming

In the FY2022-23, both of Companys Animation, VFX, Gaming

& Comics (AVGC) brands, Arena and MAAC, successfully introduced their Gaming and Immersive Media courses. These programs were developed in collaboration with Epic Games, incorporating comprehensive training on their acclaimed Unreal Game Engine platform. Learning centres that met the necessary qualifications received the esteemed Unreal Authorized Training Centre (UATC) certification from Epic Games.

To effectively promote these courses, each brand undertook targeted marketing initiatives, which included:

• Arena launched a dedicated sub-brand called Arena Gaming at a prominent industry event.

• Arena Gaming organized Cyber Ninja, a captivating mobile gaming marathon.

• MAAC partnered with Playground, a popular gaming reality show with notable celebrity influencers in the role of team leads, as a Skill Partner to endorse its Gaming courses.

As a result of these efforts, the Gaming segment accounted for a noteworthy 14% of the new course bookings (in value terms) during FY2022-23.

Phygital centre Model

The conventional MAAC centre model faces certain limitations that limit its viability in smaller towns. To expand the brands network in Tier-3 and smaller markets, the Company successfully piloted a new PHYGITAL centre model during the reported fiscal year. This innovative approach combines physical and digital elements to deliver hybrid learning programs in the AVGC segment while maintaining competitive pricing. The hybrid learning model includes a substantial number of sessions to be conducted centrally by the Companys faculty.

Update on Migration to the student Delivery Model

The Company started migrating its learning centres in Domestic Retail division (except Aptech International Pre-school) to the Student Delivery model from the Royalty Fee model, effective from April 1, 2021. The key difference is that the Student Delivery model requires the income to be accrued, on a gross basis, to the extent of course completion by the student, in comparison to the recognition of net share payable to the Company recognised as income under the Royalty Fee model. The share of the Business Partner is recognized as a cost in the Student Delivery model, which was not part of the Companys P&L under the Royalty Fee model. As the Student Delivery model becomes effective for a centre only from their respective date of migration, all the enrolments done prior to such date of migration continue to be reported on the basis of the Royalty Fee model. Hence, the Company currently has both streams of income. During the reported period, the collection from Domestic Retail students enrolled under the Student Delivery Model was 51.4% of the total student collection for Domestic Retail (excluding brands not in scope for the migration).

Other operational updates

In FY2022-23, the Retail segment delivered its best-ever performance in terms of revenue and profits. Some of the key operational highlights for the Domestic and International Retail divisions are highlighted below.

Domestic Retail

Key operational highlights for the Domestic Retail business in FY2022-23 were as follows:

1. Domestic Retail student collections (Billing) witnessed a substantial YOY growth of 46.3%, also surpassing the pre-COVID year, FY2019-20, by 12.8%. Fresh bookings for the division also had a notable increase of 50.8% YOY and were 13.8% higher than FY2019-20. The Same Store YOY Growth for the top brands was an impressive 54.5% in terms of Booking and 48.2% in terms of Billing.

2. #HarGharHunar campaign was launched in conjunction with the #HarGharTiranga celebration, commemorating the 75th year of Indian independence. #HarGharHunar aimed to inspire the Companys target audience of young adults by highlighting the success of Skilled Employed Professionals (SEP).

3. The Company signed up Ananya Pandey as the Brand Ambassador for its Lakme Academy brand and successfully leveraged her connect with the brands audience through multiple campaigns.

4. Lakme Academys mega beauty competition ‘The Showcase saw participation from ~80 teams of 400+ students competing across three categories of Hair & Make-up, Skin and Nails. The Cover Girl was another competition organized by Lakme Academy that attracted ~3,100 participants across 600 teams to compete for an opportunity to do Hair & Makeup for Feminas digital edition cover.

5. The 19th edition of the prestigious MAAC event, 24FPS, which serves as the leading award show for the AVGC industry, was successfully organized in hybrid-mode with 6,000+ student entries from 101 countries. The event witnessed the attendance of over 1,500 students and 250 industry delegates offline, with an online live viewership of more than 19,000.

6. The Industry Connect Alliances and Placement(ICAP)team launched a new E-Cell (Entrepreneurship Cell) initiative aimed at nurturing, inspiring, and guiding students on entrepreneurship and the Gig economy through sessions, masterclasses, workshops, and courses.

7. The ICAP team collaborated with CII (West) under the banner of Project C.A.R.E. by conducting many sessions to promote employability and providing career guidance to college students and fresh graduates.

International Retail

1. The International Retail division delivered exceptional performance across all key indicators, achieving remarkable YOY growth of 39.2% and 29.9% in Booking and Billing, respectively, compared to FY2021-22. Impressively, when compared to the pre-COVID year of FY2019-20, both Booking and Billing figures surged by 62.3% and 46.7%, showcasing a substantial improvement.

2. Vietnam and Nigeria, two of Companys top-performing international markets, demonstrated significant revenue growth of 35% and 60%, respectively, during FY2022-23.

3. During the year, we expanded our presence by signing up 13 new centres across various international markets. One of the new sign-ups was the Companys strategic entry into Zambia with an Arena Multimedia centre in partnership with ZCAS University, Lusaka.

4. 3rd edition of TECHWIZ, a global tech competition, saw registrations from 530+ teams with 2,500+ participants across 15 countries. Similarly, 100 Hours Creative Marathon event saw participation of over 100 students from Vietnam, Nigeria, and South Asia to create 25 to 30 sec Animation film in 100 hours.


The Institutional segment demonstrated an outstanding performance in FY2022-23, building on its remarkable turnaround in the previous year, FY2021-22. This year witnessed the segment achieving record-breaking turnover, segment profits, cash collection, and return ratios, marking an unprecedented milestone in its history. The key operational highlights that contributed to this success are as follows:

1. The Company successfully executed the largest assessment project in its history. It involved conducting over 3.2 million exams across 580+ centres in more than 200 cities, spanning 48 shifts (or 24 days). Company achieved a major milestone of conducting exams with over 1 lakh concurrent nodes per shift.

2. The Company successfully completed projects for 11 new customers with annual revenues exceeding Rs. 10 lakhs. These new customers included Staff/Service Selection

Boards of two key states in India, sectoral training institutes in the BFSI and Transportation domains, as well as various prominent Central, State, and academic institutions.

3. New customers revenue contribution was 75% in FY2022-23.

Consolidated Financial Performance

The Companys consolidated Operating Revenue for the year ended March 31, 2023, went up by 102.1% from Rs. 22,610 Lakhs in FY2021-22 to Rs. 45,692 Lakhs. Retail segment revenue growth was 120.9% on a YOY basis and would have been 43.5% on a like-to-like basis, after excluding the impact of the migration to the Student Delivery Model. The segment PBT margin of the Retail segment dipped from 32.2% to 24.3% primarily due to the migration to the Student Delivery Model. However, after excluding the impact of the migration, the segment PBT margin would have been 42.8% as against 37.6% for FY2021-22. The Retail segment PBT went up by 66.3% on a YOY basis. The Institutional segment posted a 131.5% jump in Segment PBT due to 77.1% increase in revenue. The segment PBT margin for the Institutional business was 21.8% vs. 16.7% in the previous year due to the operating leverage in the business. The segment PBT increased from Rs. 1,617 Lakhs to Rs. 3,748 Lakhs in FY2022-23 whereas the Operating Revenue went up from Rs. 9,707 Lakhs in FY2021-22 to Rs. 17,193 Lakhs during the reported year. The Companys EBIT was up by 89.0% than the previous year and reached Rs. 8,240 Lakhs. The Other Income rose by 23.2% to Rs. 1,317 Lakhs majorly owing to increase in interest income on bank deposits and writeback of excess provisions. Profit Before Tax went up by 89.4% whereas the Profit After Tax for the period jumped 36.9% to touch Rs. 8,226 Lakhs and Rs. 6,769 Lakhs respectively. While the MAT credit entitlement in the current period was roughly the same, with no write back of excess tax provisions of prior years as against Rs. 326 Lakhs in the previous year and effect of recognition of deferred tax asset of Rs. 534 Lakhs against reversal of Rs. 42 Lakhs in the previous year, the overall tax rate was at 17.72% vs. -13.85% in FY2021-22. Overall basic EPS for the year was at Rs. 16.36 as against Rs. 12.07 in FY2021-22. The debt on the balance sheet continued to be zero. Cash and Cash Equivalents amounted to Rs. 21,423 Lakhs as of March 31, 2023.

(Rs in Lakhs)

Segment Fy2021-22 Fy2022-23 Variance Fy2021-22 Fy2022-23 Variance



Operating Revenues 12,903 28,499 120.9% 9,707 17,193 77.1%
PBT 4,157 6,913 66.3% 1,617 3,748 131.5%
Capital Employed* 136 -1,276 -1,035.6% 3,106 -1,261 -140.6%

* as on 31st March of respective financial years

Segment Fy2021-22 Fy2022-23 Variance
Income 672 628 -6.6%
PBT -1,431 -2,435 -70.2%
Capital Employed* 17,745 28,172 58.8%

* as on 31st March of respective financial years changes in Key Financial Ratios


Fy2021-22 Fy2022-23 Change

Explanation (for > 25% variance)

Interest Service Coverage Ratio

296.6 648.4 >25%

70%+ increase in the earnings due to growth in Retail and Institutional segment profits. Lower interest expense due to lower drawdown on working capital facilities.

Debt Equity Ratio Nil Nil <25% -

Current Ratio

217% 152% >25%

More than 120% jump in Current Liabilities due to increase in trade payables (linked to execution of a large assessment order in the last few months), whereas the Current Assets increased only ~55%..

Long term debt to working capital

Nil Nil <25%


Current liability ratio 97.5% 96.3% <25% -
Debtor turnover 3.4 7.1 >25% Near doubling of revenues whereas the average receivables decreased marginally due to robust collections in Institutional business. Migration to the Student Delivery Model in Retail segment.
Inventory turnover 1.5 2.4 >25% Decrease in inventory levels while the COGS increased due to robust sale.
Operating margin (%) 14.6% 15.2% <25% -
Net profit margin (%) 21.9% 14.8% >25% Higher current taxes combined with movement in net deferred tax asset recognition of nearly Rs. 6 crore and no writeback of excess tax provision for prior years resulted in a significantly higher tax rate. Hence, lower Net profit margin.
Fixed Asset turnover ratio 1,158.5% 2,416.8% >25% Capital light business model of the Company meant it could more than double the revenues even when the average fixed assets declined by ~3%.
Return on Equity ratio 26.3% 29.0% <25% -
Return on Capital Employed 20.8% 27.0% >25% Sustained growth in Retail profits and more than double profits in Institutional. Combined with reduction in capital employed for both segments, resulted in increase in ROCE.

Material Developments in Human Resources

The Companys Human Resource (HR) department is committed to developing and maintaining a high-performing workforce that is aligned with the Companys strategic goals. With this objective, it has implemented a number of innovative practices and invested in best-in-class processes to create an enabling environment for its employees. One of the key talent development initiatives taken by the Company in the past year was to invest in leadership and management development for a large pool of its middle management with the help of the countrys leading management institute. The employee strength of the Company as of March 31, 2023, was 505 as against the count of 458 recorded on March 31, 2022. The average voluntary attrition for FY2022-23 was 23.7%, a minor decrease from 23.8% in the previous financial year.

Opportunities and threats opportunities

As a skilling company in the non-formal space, the Company has varied opportunities that it can leverage to achieve growth. Some of these opportunities are listed below.


1. The Company can offer skilling programs for newer verticals that have significant employment opportunities, attractive remuneration, and room for career growth. It can also offer courses catering to newer segments within the same industry vertical. The Indian governments focus and investments to promoting skilling provide a favourable environment for the Company.

2. The Company can explore other opportunities in the Education sector that align with its expertise in branded and distributed learning delivery.

3. The issues of unemployment, capacity shortages, and the need for quality higher education are common to emerging countries, including India. Leveraging its success and capabilities in its existing international markets, the Company can venture into newer countries and take more brands global.

4. The COVID-19 pandemic has accelerated the acceptance of online learning and service delivery. The Company can expand its operations in this space to deliver training programs at scale, reaching a broader audience, and accessing a diverse pool of resources to improve training delivery.

5. New policy initiatives by the Indian Government, such as B.Voc. courses and vocational thrust in school curriculum under the National Educational Policy (NEP) 2020 create more growth avenues for the Company.

Institutional Business

1. Indian governments Digital India initiatives and the establishment of the National Testing Agency (NTA) have created a conducive environment for the Companys Institutional business.

2. Many parts of educational value chain across segments are still analog. The Company can develop digital offerings, for e.g., its Digital Evaluation product, to cater to the growing demand for digitization.

However, there are also certain threats that the Company needs to address.


1. The education sector is vulnerable to an unstable policy and macro environment, which may lead to overregulation or fluctuations in demand, potentially destabilizing the Companys business.

2. The formal education sector poses a significant competitive threat to the Companys Retail business, as learners and industries often prioritize formal qualifications over non-formal ones.

3. EdTech companies, especially those focused on aggressive growth, can disrupt the markets the Company currently serves through unsustainable pricing, freemium models, or misleading promises.


The global GDP growth numbers published by the International Monetary Fund in its April 2023 World Economic Outlook report show a 2.8% increase in 2023 vs. 3.4% jump in 2022 and 6.3% upswing in 2021. The same report provides the real GDP growth estimates for 2022 and projections for 2023 and 2024 in the key markets of the Company. They are as follows:


% GDP growth in 2022 (E) % GDP growth in 2023 (F) % GDP growth in 2024 (F)
India* 7.2 6.5 6.3
Vietnam 8.0 5.8 6.9
Nigeria 3.3 3.2 3.0
Qatar 4.2 2.4 1.8
Egypt 6.6 3.7 5.0
Kenya 5.4 5.3 5.4
Saudi Arabia 8.7 3.1 3.1

* Indian estimates and projections are on a financial year basis with 2022 (E) corresponding to FY2022-23. 2022 and 2023 numbers are based on Reserve Bank of India estimates/ forecasts.

The key industries to whom the Company supplies talent pool in the Indian market are expected to grow well in the year 2023-24. The Indian Media & Entertainment sector was forecasted to grow at 11.5% over 2022 to touch Rs. 2.34 trillion in 2023. Within the sector, the size of Animation and VFX segment was forecasted to increase to Rs. 133 billion in 2023, a rise of 24.3%. Similarly, the Beauty & Wellness industry was expected to grow to INR 206,362 crores in 2023 with a YOY growth of 16% within which the Beauty & Salon sectors contribution is projected to be INR 55,669 crores (YOY jump of ~17%). In the Indian Aviation industry, the domestic passenger traffic is expected to expand to 160 million in FY2023-24, a growth of ~18%, indicating a growing need for talent. The IT sector outlook for FY2023-24 was cautious with an expectation of similar growth as FY2022-23, i.e., in the region of 7 – 8%. The employment growth in sectors addressed by the Company is likely to be robust even though the broader economic growth is expected to slow down to 6.5% in FY2023-24.

Risks, challenges and concerns

The Company faces several risks and challenges that are specific to its business environment. The Company recognizes these potential pitfalls and has put in place necessary safeguards and mitigation measures to protect itself.

Channel Risks: In the Retail business, the Company relies on its Business Partners for managing the centre operations across the student lifecycle. Hence, the Company relies heavily on their capabilities, motivation, financial viability, and continued compliance for its success in the Retail segment. Similarly, in the Institutional segment there is dependence on the providers of exam centres for flawless execution of any assessment project.

Obsolescence Risk: Evolution in technologies and disruptive business models can drastically alter the nature and volume of skills in demand, In todays fast-paced world, educational content, technology, and methodologies quickly become outdated.

Execution Risk: Despite having and following well-defined and thoughtfully defined processes, there is a possibility of failures during delivery of services in Companys both the business segments because of external factors or mishaps or human errors. Failures in the form of time delays, quality issues, cost overruns etc. may lead to financial losses, penalties, loss of reputation, and customer exits.

The Companys mitigation approaches are varied and effectively address the above risks. Some of the standard risk mitigation approaches employed by the Company include:

• Companys conscious expansion into multiple verticals and presence across many geographies aids in addressing broader macro risks through diversification.

• Continuous research, agile curriculum development, and strategic partnerships can mitigate obsolescence risk.

• Company has a vast network of Business Partners and other channel partners, thus preventing over reliance on a single or a small group. It selects these partners after a detailed and in-depth assessment of their financial viability, operational capabilities, adherence to quality and focus on customer service.

• Company has invested in technology across its value chain to efficiently manage its operations, have real-time visibility, and ability to deliver a superlative experience for its customers.

• Promoting a culture of quality and process orientation to minimize execution issues.

The Company has an institutionalised Risk Management Policy covering the above mitigation approaches to manage all probable and possible risks to the Company.

i nternal controls and their adequacies

The Company has a comprehensive internal control framework that is designed to achieve the objectives of operational efficiency and quality, process and regulatory compliance, asset safety, reporting accuracy, and risk management. The key components of the internal control framework include:

• A clear organizational hierarchy with well-defined roles and responsibilities.

• Documented and published policies and procedures.

• A well-defined authority matrix.

• Regular reviews by the management including monitoring of performance against budgets.

• Internal and statutory audits to ensure compliance.

• A well-defined system of recording and maintaining audit trails.

Oversight by the Board of Directors.

The internal control framework is reviewed and updated on a regular basis to ensure that it remains effective in meeting the needs of the business.

Cautionary statement

Certain statements herein are forward-looking statements, which involve a number of risks, uncertainties, assumptions, and other factors that could cause actual results to differ materially from those in such forward-looking statements. All statements, other than statements of historical fact are statements that could be deemed forward looking statements, including but not limited to the statements containing the words ‘planned, ‘expects, ‘believes, ‘strategy, ‘opportunity, ‘anticipates, ‘hopes or other similar words. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding impact of pending regulatory proceedings, fluctuations in earnings, our ability to manage growth, intense competition in IT services, Business Process Outsourcing and consulting services including those factors which may affect our cost advantage, wage increases in India, customer acceptances of our services, products and fee structures, our ability to attract and retain highly skilled professionals, our ability to integrate acquired assets in a cost effective and timely manner, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions on immigration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks, our ability to successfully complete and integrate potential acquisitions, the success of our brand development efforts, liability for damages on our service contracts, the success of the companies / entities in which we have made strategic investments, withdrawal of governmental fiscal incentives, political instability, legal restrictions on raising capital or acquiring companies outside India, and unauthorized use of our intellectual property, other risks, uncertainties and general economic conditions affecting our industry. There can be no assurance that the forward-looking statements made herein will prove to be accurate, and issuance of such forward-looking statements should not be regarded as a representation by the Company or any other person that the objective and plans of the Company will be achieved. All forward-looking statements made herein are based on information presently available to the management of the Company and the Company does not undertake to update any forward-looking statement that may be made from time to time by or on behalf of the Company.