AXISCADES Technologies Ltd Directors Report.


The Members,

Your Directors have pleasure in presenting the 29th Annual Report on the business and operations of the Company, together with the Financial Statement of the Company, for the financial year (FY) ended 31 March, 2019. The Consolidated performance of the Company and its subsidiaries has been referred to, wherever required.





2018-19 2017-18 2018-19 2017-18
Total income 22,679.93 23,951.76 61,676.54 53,422.69
Total expenditure (before interest & depreciation) 22,097.02 22,646.79 59,579.60 50,157.13
Earnings before interest, depreciation, amortization and extra-ordinary items 582.91 1,304.97 20,96.94 3,265.56
Interest & finance charges 1,667.64 720.32 2,357.41 1,368.97
Depreciation & amortization 907.01 1370.11 1,974.81 1,876.32
Earnings/before Tax and Exceptional Items (1,991.74) (785.46) (2,235.28) 20.27
Share in net profit/(Loss) of associate - - (54.75) -
Exceptional item (1,450.68) 298.69 (1,450.68) 298.69
Profit/(Loss) before Tax (PBT) (541.06) (1084.15) (839.35) (278.42)
Provision for Tax - Current & Deferred (141.67) (142.34) (71.89) 502.78
Net Profit/(Loss) after Tax (PAT) (399.39) (941.81) (767.46) (781.20)
Minority Interest - 0.00 45.82 43.78
Profit/(Loss) for the period (399.39) (941.81) (813.28) (824.98)

Performance Review

The Company enhanced its engagement with clients in aerospace, heavy engineering, industrial products and auto industry. The Companys engineering services revenue has grown significantly in Heavy Engineering vertical. The Strategic Technologies vertical is also showing positive momentum with various defense related contracts in the production stage and confirmed deliveries. The margins however got impacted due to difficulties faced with the two clients and write-offs coupled with higher cost during the quarter due to organizational restructuring. The Management has implemented various cost reduction initiatives and the impact of these measures are already visible.

Financial Highlights - Standalone

Total Income decreased marginally by 5.31% in 2018-19. EBIDTA decreased by 55.35% to Rs (582.91) Lakhs in 2018-19. Loss before tax and exceptional items is Rs (1991.74) Lakhs in 2018-19. Net loss after tax is Rs (399.39) Lakhs in 2018-19.

Financial Highlights - Consolidated

Total Income increased by 15.5% to Rs 61,677 Lakhs in 201819. EBIDTA decreased by 35.8 % to Rs 2,097 Lakhs in 2018-19.

Profit before tax and exceptional items decreased from Rs 20 lacs to ( 2235) lacs 2018-19. Net Profit/(loss) after tax, before minority interest, decreased by 1.8% to Rs (767) lakhs in 2018-19.


The Company has not transferred any amount to its reserves for the Financial Year ended 31 March, 2019.


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 2018-19.


Investments covered under Section 186 of the Companies Act, 2013 form part of the Notes to the financial statements provided in the Annual Report. The Company has not provided any loan or guarantee to any body corporate, during the year.


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.

Issue and Listing of Shares

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

During the financial year the Company has not issued any shares and therefore there is no change in the Share Capital of the Company.

Particulars of Contracts or Arrangements with Related Parties

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 and the Board, if required. Your attention is drawn to the Notes to the financial statement.

The Company has not entered into any transaction with related parties which can be considered material in accordance of 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

Material Changes and Commitments

There were no material changes and commitments affecting the financial position of the Company occurred between the financial year end and the date of this report. However, the Company has agreed to acquire Mistral Solutions Pvt. Ltd. (MSPL) in a phased manner, where by in phase I (which was completed on 15 December, 2017) it acquired 43% stake in MSPL by way of share acquisition from its existing shareholders and in Phase II by way of Scheme of Amalgamation of the Shareholder Company of MSPL. The National Company Law Tribunal, Bengaluru Bench at Bengaluru vide their Order dated 8 March, 2019 has approved the Scheme of Amalgamation of Explosoft Tech Solutions Private Limited with AXISCADES Engineering Technologies Limited and their respective shareholders. The Scheme has also been filed with the National Company Law Tribunal, Mumbai for approval.

Management Discussion and Analysis

In terms of the provisions of Regulation 34 of the Securities and Exchange Board of India (Listing Obligation 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. (formerly Axis Inc.) Peoria, Illinois USA 100%
2 AXISCADES UK Ltd. (formerly Axis EU Europe Ltd.) Leicestershire, UK 100% shares held by AXISCADES Inc.
3 AXISCADES Technology Canada Inc. (Formerly Cades 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) Private Limited (CSTI) Bengaluru, India 76%
2. AXISCADES Aerospace & Technologies Pvt. Limited (ACAT) Bengaluru, India 100%
3. AXISCADES Aerospace Infrastructure Private Limited (AAIPL) Bengaluru, India 99.99 % shares are held by ACAT
4. Enertec Controls limited (Ed) Bengaluru, India 51.84 % is held by ACAT and 48.16% by AAIPL
5. Mistral Solutions Pvt. Ltd. Bengaluru, India 100% (refer note 6(a) 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.

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.

Consolidated Financial Statements

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


BOARD OF DIRECTORS Retirements and Reappointments

In the ensuing Annual General Meeting, Mr. Sudhakar Gande & Mr. Ajay Lakhotia, Directors, retire by rotation, and being eligible, offers themselves for re-appointment

The Directors recommend their re-appointment at the ensuing Annual General Meeting.

Mr. Sudhakar Gande, Director, stepped down as a Vice Chairman & Executive Director w.e.f. 30.07.2018, due to change in the role & responsibilities and continuing as Non-Executive Director.

Induction and cessation of Directors and KMP

Name of the Director Category Date of Appointment / reappointment Date of Approval by Shareholder Date of Resignation / cessation
Mr. Anees Ahmed Executive Director 28.07.2018 10.09.2018
Mr. Ashwani Datta Non-Executive Director 28.07.2018 10.09.2018
Mr. Ajay Lakhotia Non-Executive Director 02.02.2019 22.04.2019
Mr. David Bradley Non-Executive Director 05.03.2019 22.04.2019
Mr. Sidhartha Mehra Non-Executive Director 10.08.2016 - 04.02.2019
Mr. Mritunjay Singh CEO & Executive Director 02.01.2018 - 19.01.2019
Ms. Mariam Mathew Independent Director 13.02.2018 31.03.2018 -
Mr. Kedarnath Choudhury Non-Executive Director 31.10.2008 - 30.05.2018
Mr. Rohitasava Chand Non-Executive Director 28.07.1999 30.07.2018
Mr. Sharadhi Chandra Babupampapathy CEO & Executive Director 21.01.2019 In ensuing AGM -
Mr. Sudhakar Gande Non-Executive Director 14.08.2015 Stepped down as Vice Chairman & Executive Director w.e.f. 30.07.2018

Human Resources Development

The Company is committed to build an environment and where employees are inspired to achieve excellence in their area of functioning. The Human Resource Policy of the Company is focused on attracting, building and retaining best talents. In this direction the Company has taken several Human Resource initiatives. Many continuous training and employee development programs are put in place. Companys commits to provide safe and healthy work environment to all the employees.

The Employee strength of the Company, on consolidated basis stood at 2147 employees during the year end.

Employee Benefit Scheme

The Company approved the ESOP Scheme - AXISCADES Engineering ESOP 2018 -Series 1 & AXISCADES Engineering ESOP 2018 -Series 2 on 31 March, 2018 which are in compliance with

SEBI (Share Based Employee Benefits) Regulations, 2014 and are made effective from 1 April 2018. As on 31 March, 2019, no stock options were granted under the Scheme.

The Nomination & Remuneration Committee has granted 7,52,300 ESOPs to the employees vide its resolution dated 29th April 2019 under ESOP Series 2.

The applicable disclosures in compliance with regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 and Rule 12 of companies (Share Capital and Debentures) Rules, 2014 are set out below:

Particulars AXISCADES Engineering ESOP 2018 -Series 1 AXISCADES Engineering ESOP 2018 -Series 2
A. Description of each Employee Stock Option Plan/Scheme that existed at any time during the year, including the general terms and conditions of each such Scheme/Plan
a) Date of shareholders approval 31 March, 2018
b) Total number of options approved under ESOS 15,10,381 15,10,381
c) Vesting requirements Not less than 1 year from date of grant and maximum period in which the options shall be vested shall be within five years from the date of grant. Not less than 1 year from date of grant and maximum period in which the options shall be vested shall be within four years from the date of grant.
d) Exercise price or pricing formula The exercise price shall be decided by the Board or the Compensation Committee in line with Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 and any other applicable guidelines. Exercise period would be eight years from the date of grant of options
e) Maximum term of option granted
f) Source of shares (primary, secondary or combination) Primary

The Grants made under the Scheme(s) would be effective from 29 April, 2019. Thus, as on 31 March, 2019, no stock options were granted under the Scheme. Other disclosures in relation to Method used to account for ESOP, Option movement during the year, Employee wise details of options granted to, Description of the method and significant assumptions used during the year to estimate the fair value of options, is not applicable as no grant has been made during the financial year 2018-19.

The general terms and conditions of the said grant are as follows:

S. No. Particulars Details
1 Brief details of options granted Grant of 7,52,300 stock options to 32 employees of the Company / its subsidiaries under ESOP Series 2.
2 Whether the scheme is in terms of SEBI (SBEB) Regulations, 2014 (if applicable) Yes
4 Pricing formula/Exercise Price Rs 52.65/- (Closing market price, on the SE having large trading volume, on the trading day prior to the NRC approval).
5 Options vested/Vesting Schedule • 50% of the options vest on the 29 April, 2020
• 50% of the options vest on the 29 April, 2021
6 Time within which option may be Exercised 8 years from the Grant Date.

The Companys ESOP disclosure can be accessed on its website

Particulars of Employees

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 IIIA 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 IV 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.

Meetings of the Board

The Board of the Company met 10 (ten) times during the 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.

Committees of the Board

The Audit Committee consists of 4 members namely, Mr. Kailash M. Rustagi, Mr. Pradeep Dadlani, Mr. Srinath Batni and Dr. Vivek Mansingh, Independent Directors, consequent to the resignation of Mr. Kedarnath Choudhury, Non-executive Director w.e.f. 30.05.2018. 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 and Corporate Social Responsibility 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.

Declaration From Independent Directors

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. The terms and conditions of appointment of Independent Directors are placed on the website of the Company at

Performance Evaluation of the Board, Committees and Directors

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.

Vigil Mechanism

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

Policy on Directors Appointment and Remuneration

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 V.

Risk Management Policy

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

The Company has a risk identification and management frame work 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.

Prevention of Sexual Harassment of Women at Workplace

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 2018-19, no complaint was 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;

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.


Statutory Auditors

M/s S.R. Batliboi & Associates LLP, Chartered Accountants (Firm Registration No. FRN 101049W/E300004), were appointed as Auditors of the Company by the shareholders at the AGM held on 24 August, 2017 to hold office until the conclusion of the 32nd AGM of the Company. Hence they will continue to be the Auditors of the Company.

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

Secretarial Auditor

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 2018-19. The Secretarial Audit Report attached as Annexure VI 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 or 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.

Significant Orders by Regulators/Courts/Tribunals

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.

Extract of Annual Return

The extract of Annual Return of your Company as on 31 March, 2019, prepared pursuant to Section 92(3) of the Companies Act 2013 and the Rules made thereunder, in Form MGT-9 is attached as Annexure VII to this Report and the same is available as part of Annual report FY 19 at

Internal Financial Controls

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 same has been audited and certified by the Statutory Auditors of the Company in their Audit Report.

Corporate Social Responsibility (CSR)

The Company has constituted a Corporate Social Responsibility Committee (CSR Committee) in accordance with the provisions of Section 135 of the Companies Act 2013 and the rules made thereunder. The Committee is chaired by an Independent Director. The Company on recommendation of the CSR Committee, has framed a CSR policy in line with Schedule VII 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 CSR Committee 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 VIII 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, is 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)

2018-19 2017-18
Foreign Exchange Earnings (actual inflows) 21,315.16 20,126.71
Foreign Exchange Outgo (actual outflows) 11,844.69 11,701.25

Technology Absorption

The Company has not engaged 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.


As in the previous years, this year too, we are publishing the Annual Report in the print version only for the members who have not registered their email address with the Company / Depository Participant. The Physical copies are sent in the permitted mode. Electronic copies of the Annual Report are sent to all the members whose email addresses 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 of Directors

Sd/- Sd/-
Sharadhi Chandra Babupampapathy Sudhakar Gande
CEO & Executive Director Director
Place: Bengaluru
Date: 8th May, 2019