aurionpro solutions ltd Directors report

To the Members of Aurionpro Solutions Limited,

The Directors are pleased to present this Twenty Fifth Annual Report of the Company, together with its audited financial statements for the year ended 31st March, 2022.

1. FINANCIAL STATEMENT

The highlights of the Consolidated Financial Statement are as under:

Particulars	For the year ended 31st March,2022	For the year ended 31st March,2021
Income
Revenue from operations	50,501.22	37,401.77
Other income	531.43	297.45
Total revenue	51,032.65	37,699.22
Operating expenses	18,260.24	10,791.45
Change of Inventories of raw material, finished goods and stock-in-trade	227.63	63.70
Employee benefits expense	17,595.03	14,978.15
Finance costs	826.39	1,579.78
Depreciation and amortization expenses	1,397.91	13,939.06
Other expenses	3,259.76	3,191.97
Total expenses	41,566.96	44,544.11
Profit/(Loss) before Exceptional Items and Tax	9,465.69	(6,844.89)
Less: Exceptional item	-	4,618.37
Profit/(Loss) before tax	9,465.69	(11,463.27)
Tax expense:
(a) Current tax	1,818.56	738.95
(b) Deferred tax credit	89.75	(445.66)
Profit/(Loss) after tax	7,557.38	(11,756.55)
Profit/ (Loss) before Tax from Discontinued Operations	-	(7,443.82)
Tax Expenses of Discontinued Operations	-	-
Profit/ (Loss) after Tax from Discontinued Operations	-	(7,443.82)
Other Comprehensive Income/(Loss) (net of tax)	(53.09)	274.29
Total Comprehensive Income/(Loss)	7,504.29	(18,926.08)

The highlights of the Standalone Financial Statement are as under:

Particulars	For the year ended 31st March,2022	For the year ended 31st March,2021
Income
Revenue from operations	28,987.72	19,170.65
Other income	323.91	330.18
Total revenue	29,311.63	19,500.83
Expenses Operating expenses	12,888.83	5,313.24
Change in inventories of raw material, finished goods and stock-in-trade	3.95	383.22
Employee benefits expense	9,555.87	7,624.57
Finance costs	644.52	1,399.53
Depreciation and amortization expenses	984.99	1,123.68
Other expenses	1,691.59	1,714.03
Total expenses	25,769.75	17,558.27
Profit/(Loss) before Exceptional Items and Tax	3,541.88	1,942.56
Exceptional Items	-	3,903.40
Profit/(Loss) before Tax	3,541.88	(1,960.84)
Tax expense:
(a) Current tax	885.77	354.12
(b) Deferred tax credit	18.55	138.26
Profit/(loss) After Tax	2,637.56	(2,453.22)
Other Comprehensive Income/(Loss) (net of tax)	(83.70)	226.74
Total Comprehensive Income/(Loss)	2,553.86	(2,226.48)

2. MATERIAL CHANGES & COMMITMENTS

There were no material changes or commitments affecting the financial position of the Company between the end of the financial year and the date of the report.

3. DIVIDEND AND RESERVES

The profit after tax for the year ended 31st March, 2022, was Rs 2,637.56 lakhs and the same has been transferred to the Retained Earnings.

The Board has recommended a dividend at 2.5/- (25%) per equity share of face value of INR 10/- each, subject to approval of the members of the Company at the ensuing Annual General Meeting.

4. STATE OF COMPANY?S AFFAIRS

Financial Year 2021-22 was a year of improved performance on all counts. We focused on positioning ourselves as IP led platform?s company and simultaneously increased investments in sales and new product development. This has paid off and is reflected in strong set of numbers with consolidated revenue for FY 22 rising by 35% at Rs 505 Crore, EBITDA rising by 33% at Rs 112 Crore. and PAT rising by 125% at Rs 76 Crore. The PAT margin improved to 15% compared to the 9% previous year.

We continued to focus on strengthening the balance sheet. As we complete our investment cycles in Toshi Automatic Systems Pvt. Ltd. (TASPL) and SCSOFT during the year, we will start building cash reserves. With sustained growth coupled with the reduced debt, free cash flow and healthy balance sheet, all the key financial ratios have improved significantly. We are at the beginning of a long term growth trajectory, with all segments having tremendous growth potential. We will further focus on increasing our sales reach, through partnerships

and expanding the sales teams across geographies. This will be bolstered by unifying our product offerings which will improve both size and scope of our customer engagements. With a combined order book and pipeline, we are confident to maintain the revenue growth rate as well as the margins for this financial year.

5. CAPITAL

During the year no further capital was raised by the Company. The Company, with an objective to retain and attract talent in the organization, had launched Employee Share Purchase Scheme, 2017 ("ESPS 2017"), during the year 2017-18. The ESPS 2017 has been framed and implemented in compliance with the SEBI (Share Based Employee Benefits) Regulations, 2014. During the year, the Company did not allot shares under the ESPS 2017. As on the date of this Report, 5,50,765 shares are available for further Grant.

6. SUBSIDIARIES/ JOINT VENTURES

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 No. AOC-1 is attached to the financial statements of the Company.

During the Year,

- To expand footprint in the payment business, the Company has launched its own payment platform. For this purpose, the Company has incorporated, two wholly owned subsidiaries, namely, Aurionpro Payment Solutions Pte. Ltd., Singapore (through Aurionpro Solutions Pte Ltd a wholly owned subsidiary) and Aurionpro Payment Solutions Pvt Ltd, India.

- The Company, has secured order from Uttar Pradesh State Transport Corporation ("UPSRTC") for implementation of ‘lOT based integrated bus ticketing system?. For this purpose, the Company has formed subsidiary namely, Aurionpro Transit Solutions Private Limited in India.

- In order to bring full integration in AFC business, the Company has entered into share purchase Agreement for acquisition of majority (51%) stake in Toshi Automatic Systems Private Limited ("TASPL") for consideration of Rs 14 Crore. Till date of this report the Company has acquired 34.94% stake in TASPL.

- To expand smart mobility business into North America, the Company through it?s subsidiary SCSOFT Pte. Ltd. had acquired 100% stake in Canada based company namely, SCSOFT Inc.

7. ANNUAL RETURN

The Annual Return of the Company as on 31st March, 2022 in Form MGT - 7 in accordance with Section 92(3) of the Act read with the Companies (Management and Administration) Rules, 2014, would be available on the website of the Company at i.e. www.aurionpro.com.

8. CORPORATE GOVERNANCE

The Report on corporate governance as per the requirements of Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the LODR"), forms part of this Annual Report. Further, the requisite certificate from M/s. Milind Nirkhe & Associates, Practicing Company Secretaries, confirming the compliance with the conditions of corporate governance has been included in the said Report.

9. MANAGEMENT DISCUSSION AND ANALYSIS (MDA)

Management Discussion and Analysis for the year under review, as required under Regulation 34 (2) (e) of the LODR has been covered in a separate section forming part of this Annual Report.

10. CORPORATE SOCIAL RESPONSIBILITY (CSR)

In accordance with the provisions of Section 135 read with Schedule VII of the Act, the Company has adopted a CSR Policy outlining various CSR activities to be undertaken by the Company. The CSR Policy of the Company is available on the website of the Company at www.aurionpro.com.

During the year under review, the Company has contributed to the following entities engaged in various fields such as providing/promoting education, safe drinking water, welfare of society, women empowerment, health care including preventive health care & sanitation, ensuring environmental sustainability etc. as per the provisions of Sec. 135 of the Act.

1. Rs 30 lakhs (Thirty Lakhs) to M/s. Partner of Holy Gospel Ministries Trust, the trust based in Mumbai having registration no. E-22013(M).

2. Rs 25 lakhs (Twenty-Five Lakhs) to Neosmile Foundation Company registered under Sec 8 of the Act (Registration no. U85300MH2019NPL323269).

The Board has constituted a ‘CSR committee? which comprises of following directors:

Mr. Amit Sheth - Chairman

Dr. Mahendra Mehta - Member

Mrs. Sudha Bhsuhan - Member

The CSR Committee, inter alia determines/recommends the budget for funding various charitable activities and recommends contributions to be made to various initiatives.

The disclosures, as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014, has been enclosed to this Report as "Annexure 1 ".

At Aurionpro, while focusing on the growth in businesses, we also put equal emphasis to social responsibilities. Aurionpro has been contributing towards various social causes, however in order to take it next level and with objective to undertake, promote and find various social initiatives in an organised manner, Aurionpro has formed Aurionpro Foundation, a section 8 Company under the Companies Act,2013. Aurionpro Foundation will work certain focus areas inter alia include education, health care, environmental protection and climate change etc.

Aurionpro Foundation has also launched a new forum ‘Aurocares? where employees of Aurionpro Group are invited to suggest ideas, create, and design various programmes aimed advancing causes. Aurionpro Foundation will select projects under ‘Aurocares? forum and which may be funded by Aurionpro Foundation and executed directly or through select NGOS.

11. INTERNAL CONTROL SYSTEM & THEIR ADEQACY

The Company has an internal control system which is commensurate with the size, scale and nature of its operations. The Internal Audit Team monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies of the Company.

12. DIRECTOR?S RESPONSIBILITY STATEMENT

In terms of the provisions of Section 134(3)(c) of the Act, the Board confirms that:

i. in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any;

ii. the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year 31 st March, 2022 and of the profit and loss of the Company for that period;

iii. the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. the Directors had prepared the annual accounts on a going concern basis;

v. the Directors, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

13. DIRECTOR?S/KEY MANAGERIAL PERSONNEL (KMP)

• Appointment/Re-appointment of Directors

The information as required to be disclosed under regulation 36 of the LODR and brief profile of director in case of appointment/re-appointment of director is incorporated in explanatory statement of AGM Notice forming part of the Annual Report.

• All Independent Directors have given declarations affirming that they meet the criteria of independence as laid down under Section 149(6) of the Act and Regulation 16(1)(b) of the LODR.

• None of the directors of the Company are disqualified under the provisions of the Act or under the LODR. All Independent Directors have provided confirmations as contemplated under section 149(7) of the Act.

• Key Managerial Personnel

Pursuant to the provisions of Section 203 of the Act as on the date of this Report, the Key Managerial Personnel of the Company comprised of Mr. Paresh Zaveri, Chairman and Managing Director, Mr. Vipul Parmar, Chief Financial Officer and Mr. Ninad Kelkar, Company Secretary.

14. PERFORMANCE EVALUATION

The Company?s policy relating to the appointment and remuneration of Directors, KMPs and other employees including criteria for determining qualifications, positive attributes and independence of Directors are covered under the Corporate Governance Report which forms part of this Annual Report.

The Board of Directors annually evaluate its own performance and that of its committees and Individual Directors.

The Board has formulated the Nomination and Remuneration Policy for selection and appointment of Directors, senior management personnel and their remunerations.

15. MEETINGS

During the year under review, the Board met five times. For details of meetings of the Board, please refer to the Corporate Governance Report, which is part of this report.

16. COMMITTEES

As on the date of this report, the Board has following committees applicable under the Act/LODR:

i) Audit Committee;

ii) Nomination and Remuneration/Compensation Committee;

iii) Stakeholder Relationship/Investor Grievance and Share Transfer Committee; and

iv) Corporate Social Responsibility Committee.

The detailed information in relation to these committees, including composition and the terms of reference and other details are provided in Corporate Governance Report.

17. VIGIL MECHANISM/ WHISTLE BLOWER POLICY

The Company has established the necessary vigil mechanism and has put in place a ‘Whistle Blower policy? in order to enable the employees and Directors of the Company to report their concerns about the management, operations and other affairs of the Company. In terms of the Whistle Blower Policy, the whistle blowers are provided an access to the Audit Committee to lodge their concerns. This policy is available on the website of the Company at www.aurionpro.com.

18. RISK MANAGEMENT POLICY

The Company has put in place necessary framework to identify, assess and mitigate various risks associated with the Company. The detailed section on business risks and opportunities forms part of Management Discussion and Analysis Report, which forms part of the Annual Report.

19. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE ACT

The details of loans, guarantees and investments, covered under the provisions of Section 186 of the Act, are given under the note no.40 to the standalone financial statements forming part of this annual report.

20. PARTICLUARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

In compliance with the provisions concerning related party transactions as prescribed under SEBI (Listing obligations and disclosure requirements) Regulations 2015, the Companies Act, 2013 and other applicable provision, the Board of Directors and Audit committee has formulated a policy which provides framework for regulating the transactions between Aurionpro and the related parties and group companies. The policy called ‘ASL- Policy on Related Party Transaction?s is available on the website of the company (www.aurionpro.com). This policy puts emphasis on the governance, transparency & reporting as there critical elements for regulating the related party transactions.

It is confirmed that

a) All the transactions with related parties, during FY 22, were in conformity with the ‘ASL- Policy on Related Party Transactions? and were approved by the Audit committee and the Board of Directors in the manner prescribed under the Policy.

b) The Audit committee had granted omnibus approved for certain related party transactions of repetitive in nature, at the beginning of FY 22. The details of such transactions were placed before the Audit committee on quarterly basis. Further the deviations if any, are approved by the Audit Committee and Shareholders wherever necessary.

c) The Audit committee has laid down the criteria for determining material related party transactions. All such material related party transactions would require approved at shareholders meeting. No such transactions were undertaken during the FY 2022.

The details of transactions entered into with the related parties are disclosed in the note no. 46 notes to the standalone financial statements forming part of this Annual Report.

21. PUBLIC DEPOSITS

During the year, the Company has neither invited nor accepted any public deposits.

22. AUDITORS AND THEIR REPORTING

M/s. Chokshi & Chokshi LLP, Chartered Accountants (Firm Registration No. 101872W/W-100045) were appointed as Statutory Auditors of the Company for a period of two years at the twenty fourth Annual General Meeting ("AGM") held on 24th September, 2021 to hold office till the conclusion of Twenty Sixth AGM.

Further, in terms of the Regulation 33(1)(d) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the ‘Listing Regulations?), the Statutory Auditors of your Company are subjected to the Peer Review Process of the Institute of Chartered Accountants of India (ICAI). M/s. Chokshi & Chokshi LLP, Chartered Accountants have confirmed that they hold a valid certificate issued by the ‘Peer Review Board? of ICAI and have provided a copy of the said certificate to your Company for reference and records.

The Statutory Auditors of the Company has stated in their report that, during the course of Audit no fraud on or by the Company has been noticed or reported.

23. SECRETARIAL AUDIT

The Secretarial Audit was carried out by M/s. Milind Nirkhe & Associates, Company Secretary in Practice. The Report of the Secretarial Audit is annexed herewith as "Annexure 2".

24. PARTICLUARS OF EMPLOYEES

In terms of the provisions of Section 197(12) of the Act read with the Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules is provided in a separate annexure forming part of this Report. Having regard to the provision of the first proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the Members of the Company. In terms of Section 136, the said annexure is open for inspection. Any Member interested in obtaining a copy of the same may write to the Company Secretary at investor@aurionpro.com.

The disclosures pertaining to the remuneration and other details as required under section 197(12) of the Act read with Rule 5(1) of the of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, have been provided in the Annual Report as "Annexure 3".

25. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of section 134(3)(m) of the Act, read with rule 8 of the Chapter IX of the Companies (Accounts) Rules, 2014, the Directors furnish herein below the required additional information:

- Conservation of Energy:

Although the operations of the Company are not energy intensive, the management is highly conscious of the criticality of the conservation of energy at all operational levels. The requirement of disclosure of particulars with respect to conservation of energy as prescribed in Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014, is not applicable to the Company and hence are not provided.

- Technology Absorption:

The Company continues to adopt latest technologies and innovations for improving the productivity and quality of its products and service offerings. The Company is also partnering with major technology providers in global markets.

- Foreign Exchange Earnings and Outgo:

The details of foreign exchange earned and spent by the Company during the year are given below: Earnings in Foreign Currency

Particulars	For the year ended 31st March,2022	For the year ended 31st March,2021
Revenue From Operations	4,129.88	3,828.37
Interest and Other Income	43.52	67.81
Total	4,173.40	3,896.18

Expenditure in Foreign Currency

Particulars	For the year ended 31st March,2022	For the year ended 31st March,2021
Software, Hardware and Other Material Cost	1,148.43	648.42
Travelling, Conveyance and Other Expenses	8.57	15.05
Total	1,157.00	663.47

26. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place necessary policy as required under the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. The Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. During the year under review, the Company has not received any complaints under the policy.

27. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant and material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

28. COST RECORDS

The Company is not required to maintain cost records specified by Central Government under section 148(1) of the Act.

29. DISCLAIMER AND FORWARD-LOOKING STATEMENT

The statements in the Board?s Report and the Management Discussion & Analysis describing the Company?s objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company?s operations include global and domestic demand and supply, input costs, availability, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

30. ACKNOWLEDGEMENTS

The Directors would like to place on record their sincere appreciation for the continued co-operation, support and assistance provided by all the stakeholders including Company?s employees, the financial institutions, banks, customers, vendors, members and other government departments and authorities.

For and on behalf of the Board of Directors

Sd/-

Paresh Zaveri

Chairman & Managing Director

Place : Navi Mumbai

Date : 18th May, 2022

Registered Office:

Synergia IT Park,

Plot No. R-270,

T.T.C. Industrial Estate,

Near Rabale Police Station,

Rabale, Navi Mumbai -400701.