Avantel Ltd Directors Report.

Dear Members,

Your directors have pleasure in presenting the 32nd Annual Report on the business of your Company together with the Audited Statements of Accounts for the financial year ended 31st March, 2022

1. COMPANY PERFORMANCE:

Financial Results and Performance of Your Company for the year ended on 31st March, 2022, on a standalone and consolidated basis is summarized below:

(In Rs Lakhs)

Particulars Standalone Consolidated
2021-22 2020-21 2021-22 2020-21
Income from Operations 10,494.37 7,769.60 10,495.35 7,769.60
Other Income 136.71 87.32 137.04 87.32
Total Income 10,631.08 7,856.92 10,632.39 7,856.92
Material Consumption Cost 5,068.80 2,657.08 5,089.42 2,657.08
Change in Inventories (400.01) 41.81 (400.01) 41.81
Employee benefit expenses 1,310.63 1,035.65 1,326.67 1,035.65
Finance Cost 151.12 151.39 151.30 151.39
Depreciation 397.19 303.15 402.79 303.15
Other expenses 1,739.17 1,817.49 1,815.38 1,817.49
Total Expenses 8,266.92 6,006.57 8,385.56 6,006.57
Profit/(Loss) - Before Tax & Exceptional Items 2,364.17 1,850.34 2,246.65 1,850.34
Current Tax 415.45 351.46 415.48 351.46
Deferred Tax 30.93 (34.49) 33.65 (34.49)
Profit/(Loss) - After Tax 1,917.79 1,533.37 1,797.70 1,533.37
Other comprehensive Income (Net Tax) (7.62) 4.28 (7.62) 4.28
Total Comprehensive Income 1,910.17 1,537.65 1,790.08 1,537.65

During the financial year 2021-22 the company has recorded a Profit (before tax) of Rs. 23.64 Crores as against Rs. 18.50 Crores in the previous year with an increase in profit by 27.78% compared to previous financial year.

2. TRANSFER TO RESERVES

The Board of Directors of the Company has not recommended transfer of any amount to the General Reserve for the FinancialYear ended March 31, 2022.

3. DIVIDEND:

Your Directors recommend a final dividend of Rs. 4 share for the financial year 202l-22.The dividend payout is subject to the approval of the members at the ensuing Annual General Meeting.The Dividend will be paid to members whose names appear in the register of members as on Monday, the 19th day, May 2022 and in respect of shares held in dematerialized form, it will be paid to the members whose names are furnished by NSDL and CDSL as beneficial owners as on that date.

4. DIRECTORS & KEY MANAGERIAL PERSONNEL:

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the company, Shri. Abburi Siddhartha Sagar (DIN: 02312563), Director retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment.The Board recommends the reappointment of Shri. Abburi Siddhartha Sagar (DIN: 02312563) for the consideration of the members of the company at the ensuing annual general meeting. Brief details of Shri. Abburi Siddhartha Sagar (DIN: 02312563) has been mentioned in the notice convening the Annual General Meeting at "Information pursuant to the Listing Regulations and Secretarial Standards in respect ofAppointment/Re-appointment of Directors".

The tenure of Dr. A Vidyasagar, Managing Director expired on 31st March, 2022. Taking into consideration, his rich experience and contribution to the Company, and pursuant to the recommendation of the Nomination and Remuneration Committee, the Board of Directors of the Company, subject to the approval of the members at the ensuing AGM, passed a resolution on 27th January, 2022, approving the reappointment of Dr. A.Vidyasagar as Managing Director of the Company for a further period of three years with effect from 01st April, 2022 to 31st March, 2025.

The tenure of Smt. Abburi Sarada (DIN: 00026543),Whole Time Director and Chief Financial Officer (CFO) of the company expired on 08th May, 2022.Taking into consideration, of her rich experience and contribution to the Company, and pursuant to the recommendation of the Nomination and Remuneration Committee, the Board of Directors of the Company, subject to the approval of the members at the ensuing AGM, passed a resolution on 6th May, 2022, recommending the reappointment of Mrs. Abburi Sarada (DIN: 00026543) as Whole-time Director of the Company for a further period of Three years with effect from 08th May, 2022 to 08th May, 2025.

5. DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declarations from each Independent director under 149(7) of the Companies Act, 2013, that they meet the criteria of Independence laid down under section 149(6) of the Companies Act 2013.

6. MEETINGS OF THE BOARD

The Board met Four times during the financial year 2021-22 viz., on 24.04.2021,15.07.2021,28.10.2021and 27.0l.2022.The maximum interval between any two meetings did not exceed 120 days.

7. SUBSIDIARIES/ASSOCIATES COMPANIES/ JOINTVENTURES:

The Subsidiary Companies situated in India continue to contribute to the overall growth in revenues and overall performance of the Company.As of 31st March, 2022 your Company had the followingWholly Owned Subsidiary:

1. M/s. Imeds Global Private Limited

PERFORMANCE OF SUBSIDIARIES

In accordance with the provisions of Section 129(3) of the Companies Act, 2013, Consolidated Financial Statements of the Company forms part of the Annual Report. A statement containing the salient features of the financial statements of the Subsidiary Company for the financial year ended 31st March, 2022 in Form AOC-1is set out In Rs. ‘Annexure I" and forms part of this report.

8. RELATED PARTYTRANSACTIONS:

Related party transactions entered during the financial year under review are disclosed in Note No. 36 of the Financial Statements of the Company for the financial year ended 31st March, 2022.These transactions entered were at an arms length basis and in the ordinary course of business. There were no materially significant related party transactions with the Companys Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Form AOC-2, containing the note on the aforesaid related party transactions is enclosed herewith as Annexure -VII.

The Policy on the Related Party Transactions as approved by the Board is uploaded on the website of the Company.

9. CONSERVATION OF ENERGY,TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE OUTGO:

Information required under section 134(3) (m) of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014, is enclosed herewith as Annexure- III.

10. STATUTORY AUDITORS:

M/s. Grandhy & Co, Chartered Accountants, who were appointed as the statutory auditors of the company at the 31st Annual General Meeting (AGM) held on June 05,2021, to hold office till the conclusion of the ensuing 36th AGM. The term of the said Statutory Auditors shall expire at the ensuing, 36th Annual General Meeting of the company.

Further, pursuant to Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014 M/s. Grandhy & Co, Chartered Accountants, being eligible, offer themselves for re-appointment for a term of 5 (Five) years in accordance with the provisions of Sec. 139 of the Companies Act, 2013 and the rules made there under. The Company has also received written consent from the Auditors and a confirmation to the effect that their re-appointment, if made, would be within the limits prescribed under the Section 141of the Companies Act, 2013 and the rules made there under.

Accordingly, the appointment of M/s. Grandhy & Co, Chartered Accountants, as the statutory auditors of the Company, at a remuneration of Rs. 3,25,000/- per annum plus out of pocket expenses and taxes at the applicable rates is hereby placed before the shareholders for their approval.

11. AUDITORS REPORT

There are no qualifications, reservations or adverse remarks made by M/s. Grandhy & Co., Chartered Accountants, Statutory Auditors in their report for the FinancialYear ended 31st March, 2022.

The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company under sub-section (12) of section 143 of the Companies Act, 2013, during the year under review.

12. INTERNAL AUDITORS:

The Board of Directors based on the recommendation of the Audit Committee has appointed M/s. Ramesh & Co., Chartered Accountants, Hyderabad, as the Internal Auditors of your Company. The Internal Auditors are submitting their reports on quarterly basis.

13. SECRETARIAL AUDITORS:

M/s. P S Rao & Associates, Practising Company Secretaries were appointed to conduct the Secretarial Audit of the Company for the financial year 2021-22, as required under Section 204 of the Companies Act, 2013 and Rule 9 there-under. The secretarial audit report for F.Y. 2021-22 forms part of this Report as Annexure- IV.

14. SECRETARIAL AUDIT REPORT

There are no qualifications, reservations or adverse remarks made by M/s. P S Rao & Associates, Practising Company Secretaries in their report for the FinancialYear ended 31st March, 2022.

15. RISK MANAGEMENT POLICY

The Company has developed and implementing a risk management policy which includes the identification therein of elements of risk, which in the opinion of the board may threaten the existence of the Company.

16. CORPORATE SOCIAL RESPONSIBILITY (CSR):

As part of the Corporate Social Responsibility initiative the Company has spent an amount of Rs. 29,37,343/- (RupeesTwenty Nine Thirty Seven Thousand Three Hundred Forty Three Only) towards the various CSR activities during the financial year 2021-22. A report on CSR Activities as required under Rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014 is enclosed herewith as Annexure -V.

The Company has adopted Corporate Social Responsibility Policy in line with Schedule-VII of Companies Act 2013, containing the activities to be undertaken by the Company as part of its CSR programs. The CSR Policy is disclosed on the website of the Company www.avantel.in.

Composition of Corporate Social Responsibility Committee:

Smt.A Sarada - Chairperson
Shri. N Naveen - Member
Shri.Y Kishore - Member

17. COMPOSITION OF AUDIT COMMITTEE:

The Audit Committee of the Company comprises the following Members

Shri. N. Naveen - Chairman
Shri.Y. Kishore - Member
Shri. E.B.V Ramana Gupta - Member
Shri. M. Narayana Rao - Member

All the recommendations made by the Audit Committee of the Company have been considered and accepted by the Board of Directors of the Company.

18. FORMAL ANNUAL EVALUATION OF PERFORMANCE OF THE MEMBERS OF THE BOARD AND COMMITTEES

One of the key functions of the Board is to monitor and review the board evaluation framework.The Board works with the nomination and remuneration committee to lay down the evaluation criteria for the performance of executive / nonexecutive / independent directors through peer-evaluation excluding the director being evaluated through a Board effectiveness survey. The questionnaire of the survey is a key part of the process of reviewing the functioning and effectiveness of the Board and for identifying possible paths for improvement. Each Board member is requested to evaluate the effectiveness of the Board dynamics and relationships, information flow, decision-making of the directors, relationship to stakeholders, company performance, company strategy, and the effectiveness of the whole Board and its various committees on a scale of one to five. Feedback on each director is encouraged to be provided as part of the survey.

Independent directors have three key roles: -governance, control and guidance. Some of the performance indicators based on which the independent directors are evaluated include:

• Ability to contribute by introducing international best practices to address top-management issues

• Active participation in long-term strategic planning

• Commitment to the fulfillment of a directors obligations and fiduciary responsibilities; these include participation in Board and committee meetings.

A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders etc.The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Directors who also reviewed the performance of the Secretarial Department. The Directors expressed their satisfaction with the evaluation process.

19. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:

The Company has in place an Internal Control System, commensurate with the size, scale and complexity of its operations. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed.

20. NOMINATION AND REMUENRATION POLICY:

A committee of the Board named as "Nomination and Remuneration Committee" has been constituted to comply with the provisions of section 178 of Companies Act, 2013 and Regulation 19 of SEBI (LODR) Regulations, 2015 to recommend a policy of the Company on directors appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters and to frame proper systems for identification, appointment of Directors & KMPs, Payment of Remuneration to them and Evaluation of their performance and to recommend the same to the Board from time to time. The policy is also posted in the investors section of the companys website.

21. FIXED DEPOSITS:

Your Company has not accepted any fixed deposits and as such no principal or interest was outstanding as on the date of the Balance sheet.

22. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

Details of the Loans, guarantees and investments covered under Section 186 of the Companies Act, 2013, if any, are given in the notes to the financial statements pertaining to the year under review.

23. POLICY ON SEXUAL HARASSMENT:

The company has adopted policy on prevention of sexual harassment of women at workplace in accordance with The Sexual Harassment ofWomen atWorkplace (Prevention, Prohibition and Redressal) Act, 2013.

During the financial year ended March 31, 2022, the company has not received any complaints pertaining to sexual harassment.

24. DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 134 (5) of the Companies Act, 2013Your Directors confirm that:

i) In preparation of annual accounts for the financial year ended 31st March, 2022 the applicable Accounting Standards have been followed along with proper explanation relating to material departures;

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

iii) The Directors have taken proper and sufficient care for their maintenance of adequate accounting records in accordance with the provisions of the Companies Act 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; and

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.

25. VIGIL MECHANISM:

The Company has a Whistle Blower Policy framed to deal with instance of fraud and mismanagement, if any in the Company. The details of the Policy are posted on the website of the Company www.avantel.in on the following linkhttp://www.avantel.in/inversteinfo.php

26. EXTRACT OF ANNUAL RETURN:

The Annual Return of the company is placed on the website of the Company www.avantel.in on the following link http://www.avantel.in/inversteinfo.php.

27. STATE OF AFFAIRS OFTHE COMPANY

The State of Affairs of the Company is presented as part of Management Discussion and Analysis Report forming part of this Report.

28. MANAGEMENT DISCUSSIONAND ANALYSIS:

Pursuant to Regulation 34 (2) (e) of SEBI (LODR) Regulations, 2015, a report on Management Discussion & Analysis is herewith annexed as Annexure-VI.

29. CORPORATE GOVERNANCE REPORT:

Pursuant to Regulation 34 read with Schedule V of SEBI (LODR) Regulations, 2015, a report on Corporate Governance is herewith annexed as Annexure-VII.

30. PARTICULARS OF EMPLOYEES:

The information required pursuant to Section 197 (12) read with Rule 5 (1) & (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, in respect of employees of the Company is herewith annexed as Annexure-VIII.

In terms of Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company does not have any employee who is employed throughout the financial year and in receipt of remuneration of Rs. 120 Lakhs or more, or employees who are employed for part of the year and in receipt of Rs. 8.50 Lakhs or more per month.

The Company does not have any employee who is employed throughout financial year or part thereof, who was in receipt of remuneration in financial year under review which in aggregate, or as the case may be, at a rate which in the aggregate is in excess of that drawn by the Managing Director or Whole-time director and holds by himself or along with his spouse and dependent children not less than 2% of the equity shares of the Company.

31. HUMAN RESOURCES:

Your Company considers its Human Resources as the key to achieve its objectives. Keeping this in view, your Company takes utmost care to attract and retain quality employees.The employees are sufficiently empowered and such work environment propels them to achieve higher levels of performance. The unflinching commitment of the employees is the driving force behind the Companys vision.Your Company appreciates the spirit of its dedicated employees.

32. SIGNIFICANT AND MATERIAL ORDERS PASSED BYTHE REGULATORS OR COURTS:

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

33. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There were no Material Changes and Commitments Affecting the Financial Position of the Company.

34. ACKNOWLEDGMENT AND APPRECIATION:

Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business associates for their consistent support and continued encouragement to the Company.

Further your Directors convey their appreciation for the wholehearted and committed efforts by all its employees.

Your Directors gratefully acknowledge the ongoing co-operation and support provided by the Central and State Governments, Stock Exchanges, SEBI, RBI and other Regulatory Bodies.

By order of the Board of Directors For Avantel Limited
Place: Hyderabad Sd/- Abburi Vidyasagar
Chairman & Managing Director DIN: 00026524
Date: 06th May, 2022