axiscades technologies ltd Directors report


The Members,

Your Directors have pleasure in presenting the 32nd Annual Report on the business and operations of the Company, along with the audited financial statements for the financial year ended March 31, 2022. The Consolidated performance of the Company and its subsidiaries has been referred to, wherever required.


(Rs lakhs)

Particulars Standalone Consolidated
2021-22 2020-21 2021-22 2020-21
Total income 18,402.64 13,516.58 61,940.02 53,830.73
Total expenditure (before interest & depreciation) 16,675.14 12,583.93 53,966.99 45,984.65
Earnings before interest, depreciation, amortization and extra-ordinary items 1,727.50 932.65 7,973.03 7,846.08
Interest & finance charges 1,171.56 1,500.77 1,575.41 2,250.40
Depreciation & amortization 950.96 1,202.59 2,506.06 2,598.58
Earnings/before Tax and Exceptional Items (395.02) (1,770.71) 3,891.56 2,997.10
Share in net profit/(Loss) of associate - - (45.82) 44.76
Exceptional item 750.42 (4,645.10) (169.34) (4,079.80)
Profit/(Loss) before Tax (PBT) 355.40 (6,415.81) 3,676.40 (1,037.94)
Provision for Tax - Current & Deferred 47.52 (91.00) 1,408.49 1,082.61
Net Profit/(Loss) after Tax (PAT) 307.88 (6,324.81) 2,267.91 (2,120.55)
Minority Interest - - 44.59 45.84
Profit/(loss) for the period (attributable to owners) EPS 307.88 (6,324.81) 2,223.32 (2,166.39)
Basic 0.81 (16.75) 5.86 (5.74)
Diluted 0.80 (16.75) 5.76 (5.74)


During the financial year 2021-22, the Company achieved 17.6% growth in overall revenue. Its key verticals, namely, Aerospace and Heavy Engineering grew by 32.6% and 28.2% respectively. The Engineering services revenue has grown by 23.2% Y-o-Y and the Strategic Technologies vertical remained flat, mainly due to disruption in supply chain due to Covid. The Company is expected to show positive momentum in the coming quarters, with expected conversions in defence contracts in FY23. The Company continues to execute on its three pillars of business transformation, namely, digital first, vertical diversification and customer diversification.


Total Income increased by 36.15% in 2021-22 to Rs 18,402.64 lakhs. EBIDTA increased by 85.22% to Rs 1,727.5 lakhs and Loss before tax and exceptional items is Rs 395.02 lakhs in 2021-22 . Net profit after tax stood at Rs 307.88 lakhs in 2021-22.


Total Income increased by 15.06% to Rs 61,940.02 lakhs in 2021-22. EBIDTA increased by 1.62 % to Rs 7,973.03 lakhs in 2021-22. Profit before tax and exceptional items increased from Rs 3,041.86 lakhs to Rs 3,845.74 lakhs in 2021-22. Net Profit/(loss) after tax, before minority interest, increased by 206.95 % to Rs 2,267.91 lakhs in 2021-22.


The Company has not transferred any amount to its general reserves for the Financial Year ended March 31, 2022.


Considering need for conservation of funds for catering to the growth plans of the Company, your Directors consider it expedient to pass over dividend for 2021-22.


The particulars of loans, guarantees and investments covered under Section 186 of the Companies Act, 2013 form part of the Notes to the financial statements provided in the Annual Report and furnished as Annexure-1.


The Company has not accepted/renewed any public deposits and as such no amount on account of principal or interest on public deposits under Section 73 of the Companies Act, 2013, read with Companies (Acceptance of Deposits) Rules, 2014 was outstanding as on the date of the Balance Sheet.


The Companys shares are listed on BSE Limited (BSE) and National Stock Exchange of India Limited (NSE). Stock performance and stock data of the Company are furnished in the section on Corporate Governance.

During the financial year 2021-22, the Company has allotted 1,54,500 equity shares under ESOP Plan which were listed on NSE and BSE vide letter NSE/LIST/2022/29922 and LOD/ESOP/TP/No.78/2021- 2022.


The particulars of contracts or arrangements with related parties referred to in Section 188(1) of the Companies Act 2013 are furnished in the prescribed form AOC-2 as Annexure I to this Report. All transactions with the related parties during the financial year were in the ordinary course of business. The transactions have been approved by the Audit Committee, the Board and the Shareholders, wherever required. Your attention is drawn to the Notes to the financial statements, in this respect.

The Company has not entered into transactions with related parties, which are considered material in accordance with the policy of the Company on material related party transactions formulated as per the requirements of Listing Regulations. The Policy on materiality and dealing with related party transactions formulated and approved by the Board is posted on the website of the Company and is accessible at


There were no material changes and commitments affecting the financial position of the Company, which occurred between the financial year end and the date of this report, save and except for the following:

The Company entered into a Share Purchase Agreement (SPA) on December 1, 2017, to acquire 100% stake in Mistral Solutions Private Limited (MSPL) along with its subsidiaries (MSPL Group) in a phased manner. MSPL Group is headquartered in Bengaluru, India and is engaged in rendering end to end services for product design and development in the embedded space. The Company acquired control on MSPL effective December 01, 2017.

Pursuant to the requirements of SPA, during the quarter ended June 30, 2018, the Company has filed an application with National Company Law Tribunal (NCLT) for amalgamation of Explosoft Tech Solutions Pvt Ltd, a shareholder of MSPL (Explosoft) with the Company, on receipt of observation letter conveying no objection

from BSE Limited and the National Stock Exchange. Further, vide order dated March 8, 2019, NCLT, Bengaluru bench has approved the scheme of amalgamation (Scheme). As the registered office of the Explosoft is situated in the state of Maharashtra, the scheme has also been filed by Explosoft on May 15, 2018, with NCLT, Mumbai for approval. Pending necessary approval from NCLT Mumbai Bench, no effect is given to aforesaid scheme of amalgamation.

During the quarter ended June 30, 2020, the shareholders of MSPL demanded for discharge of purchase consideration of Phase II of SPA aggregating Rs 7,213 lakhs as the scheme of merger has not yet been approved. The shareholders also demanded an interest of Rs 1,431 lakhs at the rate of 12% per annum on account of delay in payment of the aforesaid purchase consideration. The Company believes that Explosoft did not take steps that were required by Explosoft to diligently prosecute the application for merger before the NCLT Mumbai so as to bring it to completion and accordingly the claim for interest by Explosoft was not tenable.

The Company has initiated arbitration proceedings against shareholders of MSPL and the Arbitral Tribunal vide its interim order dated August 28, 2020 has asked to maintain the status quo with respect to shareholding in MSPL and has ordered shareholders of Mistral not to seek dismissal or rejection of abovementioned application for merger till further orders are issued by the Arbitral Tribunal. Additionally, both the parties are ordered to maintain status quo with respect to the existing constitution of the Board of Directors of MSPL. The matter is pending before the Arbitral Tribunal and the final outcome of the matter is not known currently.


In terms of the provisions of Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation 2015, a detailed chapter on Management discussion and analysis highlighting the Companys strategy, business environment, operations, performance, risks and outlook is provided separately in this Annual Report.


The Company has the following subsidiaries: Overseas Subsidiaries

Sl. No Name of the subsidiary Location/Country %age Shareholding
1 AXISCADES, Inc. Peoria, Illinois USA 100%
2 AXISCADES UK Ltd. Leicestershire, UK 100% shares held by AXISCADES Inc.
3 AXISCADES Technology Canada Inc. Montreal, Quebec, Canada 100%
4 Axis Mechanical Engineering Design (Wuxi) Co Ltd. Wuxi City, China 100%
5. AXISCADES GmbH Germany 100%
6. Mistral Solutions Inc. USA 100% shares held by Mistral Solutions Pvt. Ltd.
7. Mistral Solutions PTE Ltd. Singapore 100% shares held by Mistral Solutions Pvt. Ltd.

Indian Subsidiaries

Sl. No Name of the subsidiary Location/Country %age Shareholding
1 Cades Studec Technologies (India) Pvt. Ltd. (CSTI) Bengaluru, India 76%
2 AXISCADES Aerospace & Technologies Pvt. Ltd. (ACAT) Bengaluru, India 100%
3 AXISCADES Aerospace Infrastructure Pvt. Ltd. (AAIPL) Bengaluru, India 100 % shares are held by ACAT
4 Enertec Controls Limited (ECL) Bengaluru, India 51.84 % is held by ACAT and 48.16% by AAIPL
5. Mistral Solutions Pvt. Ltd. Bengaluru, India 42.91% (read together with note 5 of the Standalone Financial Statement)
6. Aero Electronics Pvt. Ltd. Bengaluru, India 100% shares held by Mistral Solutions Pvt. Ltd.
7. Mistral Technologies Pvt. Ltd. New Delhi, India 100% shares held by Mistral Solutions Pvt. Ltd.

The Company has incorporated a Joint Venture Company in the name of ASSYSTEM AXISCADES Engineering Pvt. Ltd., on 31.08.2018, having its registered office in Hyderabad. The Company holds 50% stake in this Company and is an associate Company within the meaning of Section 2(6) of the Companies Act, 2013.

Owing to various geo political and business constraints, Assystem is not hopeful of acquiring any business of meaningful volumes in the near future and it has been decided by the Board of Directors in their meeting held on May 24, 2022 to close the JV Operations.

A report on the performance and financial position of each of the subsidiaries & Associate as per rule 8(1) of Companies (Accounts) Rules 2014 is furnished under the statement containing salient features of financial statements of subsidiaries & Associate in Form AOC-1 is attached to this Report as Annexure II, pursuant to Section 129(3) of Companies Act 2013.

In accordance with the provisions of Section 136 of the Companies Act, 2013, the audited financial statements of subsidiaries have been placed on the Companys website at The copies of these documents will be sent if requested by any shareholder of the Company/ subsidiary interested in obtaining the same. These documents will also be made available for inspection at the Registered Office of the Company during business hours on working days.


Pursuant to the provisions of Section 129(3) of Companies Act 2013 read with Indian Accounting Standards (IND AS) 21, 23 and 27, the audited Consolidated Financial Statements are furnished in the Annual Report.


In the ensuing Annual General Meeting, Mr. Sudhakar Gande, NonExecutive Director and Mr. Harold David Walker, Non-Executive Director retire by rotation, and being eligible, offer themselves for re-appointment

Based on performance evaluation and the recommendation of the Nomination and Remuneration Committee, the Board recommends their reappointment at the ensuing Annual General Meeting. Mr. Arun Krishnamurthi was appointed as CEO & Managing Director (Additional Director) w.e.f. November 22, 2021. Mr. David Abikzir & Mr. Abhishek Kumar were appointed as Non-Executive, NonIndependent Directors (Additional Directors) w.e.f. March 22, 2022.

Induction and cessation of Directors and KMP

Sl. No Name of the Director/KMP Category Appointment / Reappointment / Cessation Date
1 Mr. Srinivas A Chief Financial Officer Cessation 31-07-2021
2 Ms. Shweta Agarwal Company Secretary & Compliance Officer Cessation 31-10-2021
3 Mr. Sharadhi Chandra Babu Pampapathy Non-Executive, Non-Independent Re-designation 22-11-2021
4 Mr. Arun Krishnamurthi CEO & Managing Director (Additional Director) Appointment 22-11-2021
5 Mr. Shashidhar SK Chief Financial Officer Appointment 03-01-2022
6 Mr. David Abikzir Non-Executive, Non-Independent (Additional Director) Appointment 22-03-2022
7 Mr. Abhishek Kumar Non-Executive, Non-Independent (Additional Director) Appointment 22-03-2022
8 Ms. Sonal Dudani Company Secretary & Compliance Officer Appointment 22-03-2022


In our constant quest to be a customer focused, performance driven and future ready organization, the Company is committed to build an environment, where employees are inspired to deliver and achieve excellence. The Human Resource Policy of the Company is focused on attracting, building and retaining the best talent. Towards this, the Company continues to explore and implement best practices in Hire to Retire Cycle, the Companys particular focus is on training and development of its Employees, to develop their skills, grow in their career and be future ready. Needless to say, the Company is committed to provide a safe and healthy work environment to all its employees.

The Company has 2,300 Employees on a consolidated basis as of March 31, 2022.


The Company has ESOP Scheme - AXISCADES ESOP 2018- Series 1 and AXISCADES ESOP 2018- Series 2 which are in compliance with SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and are effective from April 1, 2018.

Further the pool of ESOPs was increased by 26,43,167 by way of variation in the terms of existing ESOP schemes series (clause 14.1 & 14.3), which became effective on receiving shareholders approval in the Annual General Meeting held on September 28, 2021.

The applicable disclosures in compliance with Regulation 14 of SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and Rule 12 of companies (Share Capital and Debentures) Rules, 2014 are set out and enclosed as Annexure III and the Report of Independent Auditor on AXISCADES ESOP 2018- SERIES 1 & 2 is enclosed as Annexure IV.


The information required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure V to this Report.

The statement of particulars of employees pursuant to Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is attached as Annexure VI to this Report.


The report on Corporate Governance as required under Schedule V of the SEBI (LODR) Regulations 2015 is attached and forms part of the Annual Report. A certificate from the Auditors of the Company as regards of compliance of conditions of corporate governance is also appended to the report.


The Board of Directors met seven times during the financial year. The dates, attendance and other particulars of the meetings are furnished in the Report on Corporate Governance attached to this Report. The intervening gap between any two meetings was within the limit prescribed by the provisions of Companies Act, 2013.


The Audit Committee consists of 3 members namely, Mr. Desh Raj Dogra, Mr. Dhiraj Mathur, Independent Directors and Mr. David

Bradley, Non-Executive Director. The Chairman of the Audit Committee is an Independent Director.

All the recommendations made by the Audit Committee during the year have been accepted by the Board.

The Company has also constituted Nomination and Remuneration Committee, Stakeholders Relationship Committee as required under the provisions of Companies Act 2013 and also as required under Listing Regulations and the composition, scope of their functions, responsibilities etc. are given in the Corporate Governance Section, which forms part of this Report.


The Company has received declarations from all Independent Directors under Section 149(7) of the Companies Act, 2013 (read together with Companies Amendment Act, 2017, to the effect that they meet the criteria of independence as laid down in section 149(6) of the Companies Act, 2013 read together with any amendment thereto and that their names have been included in the databank of Independent Directors and are compliant with the prescribed regulations. The terms and conditions of appointment of Independent Directors are placed on the website of the Company at


The Board of Directors have carried out an annual evaluation of its own performance, Board Committees and individual directors pursuant to the provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015.

The performance of the Board and its committees were evaluated by the Board / committee after seeking inputs from all the directors/ members on the basis of the criteria and framework adopted by the Board. The evaluation process has been explained in the Corporate Governance Report section of the Annual Report.


The Vigil Mechanism of the Company which also incorporates the Whistle blower policy provides a formal mechanism to all Directors and employees to approach the Chairman of the Audit Committee and make protective disclosures about unethical behavior, actual or suspected fraud or violation of the Companys Code of Conduct or ethics policy. The Whistle Blower Policy is an extension of the Company Code of Conduct, which requires every employee to promptly report to the Management any actual or possible violation of the Code or an event he is aware of, that could affect the business or reputation of the Company. The disclosures reported are addressed in the manner and within the time frames prescribed in the Policy. No personnel of the Company were denied access to the Chairman of the Audit Committee. The Whistle blower policy which also describes the mechanism may be accessed on the Companys website at


The Companys policy on directors appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a director and the policy on remuneration of directors, key managerial personnel and other employees formulated pursuant to Section 134(3)(e) and 178(3) of the Companies Act, 2013 are furnished in Annexure VII.


The Company has formulated and implemented a Risk Management Policy which focuses on identification of various elements of risks, if any, which in the opinion of the Board, may threaten the existence of the Company.

The Company has a risk identification and management framework appropriate to its size and the environment under which it operates. The risk management process involves identification and periodic assessment of potential risks and their impact on the operations, profitability, growth and continuity of the business and focuses on risk elements pertaining to competitive position in the key market segments, business environment, statutory and regulatory changes, global economy and business scenario, Currency exchange rate fluctuations, resource constraints etc. and initiating timely preventive as well as remedial actions.

Reporting and control mechanisms ensure timely information availability and facilitates proactive risk management. These mechanisms are designed to cascade down to the level of line managers so that risk at the transaction level is identified and steps are taken towards mitigation in a decentralized fashion.

Risks are being continuously monitored in relation to business strategy, operations and transactions, statutory/legal compliance, financial reporting, information technology system etc. based on the inputs from both external and internal sources like key incidents, Internal audit findings etc.

The Board of Directors is responsible for monitoring risk levels on various parameters and the senior management group ensures implementation of mitigation measures, if required. The audit committee provides the overall direction on the risk management policies.


In order to prevent sexual harassment of women at work place your Company has adopted a Policy for prevention of Sexual Harassment of Women at Workplace and has proper mechanism to control the same, which is commensurate with the nature and size of the business of the Company. During the financial year 2021-22, no complaints have been received. The Company has an Internal Complaints Committee in compliance with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.


Pursuant to Section 134(5) read with Section 134(3)(c) of the Companies Act, 2013, your Directors 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; if any

b. they have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or 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 the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. they have prepared the annual accounts 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 that such systems are adequate and operating effectively.


M/s S.R. Batliboi & Associates LLP, Chartered Accountants (Firm Registration No. 101049W/E300004), were appointed as Auditors of the Company by the shareholders at the AGM held on August 24, 2017 to hold office until the conclusion of the 32nd AGM of the Company. The term of office of S.R. Batliboi & Associates LLP, as Statutory Auditors of the Company will conclude from the close of the forthcoming AGM of the Company. The Board of Directors of the Company, based on the recommendation of the audit committee, at its meeting held on May 24, 2022, reappointed S.R. Batliboi & Associates LLP, Chartered Accountants (Firm Registration No. 101049W/E300004) as the Statutory Auditor of the Company to hold office for a second term of five consecutive years from the conclusion of the 32nd AGM till the conclusion of the 37th AGM to be held in the year 2027, which will be placed for the approval of the shareholders at the ensuing AGM.

The Auditors Report does not contain any qualification, reservations or adverse remarks. The Auditors Report is enclosed with the financial statements in this Annual Report.


Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Anant B. Khamankar & Co., Company Secretaries, to undertake Secretarial Audit of the Company for the financial year 2021-22. The Secretarial Audit Report of the Company and its material subsidiaries for the FY22 are attached as Annexure VIII forms part of this report. Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

Details in respect of frauds reported by Auditors other than those which are reportable to the Central Government

The Statutory Auditors and the Secretarial Auditors of the Company have not reported any frauds to the Audit Committee or to the Board of Directors under section 143(12) of the Companies Act, 2013, including rules made thereunder.


There are no significant and material orders passed by the regulators or courts which would impact the going concern status of the Company and its future operations.


The Annual Return of your Company as on March 31, 2022, prepared pursuant to Section 92 of the Companies Act 2013 and the Rules made thereunder, in Form MGT-7 is available on the website of the Company at at the link https://www.axiscades. com/investors_data/annual_report/Annual%20Report%20-%20 FY%2022.pdf.


Your Company has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.


The Company has dissolved its Corporate Social Responsibility Committee in its Board Meeting held on June 11, 2021 pursuant to the amendment in CSR Rules and Section 135 of the Companies Act,

2013. The policy has been posted and is accessible on the Companys website at

The salient features of which are as under:

• CSR activities are based on three broad indicators of development namely Human Capital, Social Capital, Economic Capital

• We recognize the need to work in partnership with other players as well.

• The Board is responsible to formulate and recommending changes to the policy indicating the activities to be undertaken including Monitoring and reviewing CSR activities

• Transparent Monitoring

The annual report on CSR activities is furnished in Annexure IX to this Report.


The particulars pursuant to Rule 8(3) of Companies (Accounts) Rules

2014, are given below:

Conservation of Energy

Being an Information Technology Company, the Companys operations are not energy intensive. However, adequate measures have been taken to conserve energy by introducing improved operational methods. The Company in its initiative to be ISO14001 - Environmental Management System compliant, is adhering to the provisions of E-Waste (Management and Handling) Rules 2011 and Batteries (Management and Handling) Rules 2011, by efficiently managing the AC installations, replacing PCs by VPC and recycling of paper etc.

Foreign Exchange Earnings and Outgo (Standalone)

(Rs lakhs)

2021-22 2020-21
Foreign Exchange Earnings 14,449.07 14,684.48
(actual inflows)
Foreign Exchange Outgo (actual outflows) 5,698.35 6,605.11

Technology Absorption

The Company does not have any imported technology. Since the requirements of the technology business are changing constantly, your Company has sought to focus on critical in-house technologies and processes, which are likely to create value in the foreseeable future.


Certain statements made in this section or elsewhere in this report may be futuristic in nature. Such statements represent the intentions of the Management and the efforts being put in by them to realize certain goals. The success in realizing these goals depends on various factors both internal and external. Therefore, the investors are requested to make their own judgment by taking into account all relevant factors before making any investment decision.


With reference to the MCA circular dated May 05, 2022 read with and SEBI circular dated May 13, 2022, this year the Company is dispensed with the printing and dispatch of Annual Reports to the Shareholders due to Covid-19 pandemic. Electronic copies of the Annual Report are sent to all the members whose email address are so registered.


Your Directors deeply appreciate and acknowledge the co-operation and support extended by Clients, Vendors, Investors and Bankers, various government agencies & regulatory bodies across the globe, the Software Technology Park, Noida, Hyderabad & Bangalore and other industry forums and agencies like NASSCOM and look forward to their continued support in the future. Your Directors wish to place on record their appreciation of the valuable contribution made by the employees of the Company at all levels.

For and on behalf of the Board
Sd/- Sd/-
Place: Bengaluru Arun Krishnamurthi Sudhakar Gande
Date: 24.05.2022 Chief Executive Officer & Managing Director Director