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Entertainment Network (India) Ltd Directors Report

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Jul 12, 2024|03:32:27 PM

Entertainment Network (India) Ltd Share Price directors Report

Dear Members,

Your Directors have pleasure in presenting the Twenty Fourth Annual Report together with the audited financial statements of Entertainment Network (India) Limited [‘the Company/ ‘ENIL] for the financial year ended March 31, 2023.

The financial statements for the year ended March 31, 2023 have been prepared in accordance with the Indian Accounting Standards (hereinafter referred to as the ‘Ind AS) as notified by Ministry of Corporate Affairs pursuant to Section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and relevant amendments issued thereafter.

1. Financial Highlights

Standalone Consolidated
Financial Year Financial Year Financial Year Financial Year
2022-23 2021-22 2022-23 2021-22
Revenue from operations 41,952.31 30,547.38 43,997.22 31,902.77
Other income 1,888.29 1,642.81 2,224.97 1,681.98
Profit before Depreciation, Finance Costs, 8,639.36 5,864.74 9,313.35 6,200.47
Exceptional items and Tax Expense
Less: Depreciation and amortisation expenses 7,734.32 7,884.07 8,504.78 8,654.91
Profit/(Loss) before Finance Costs, Exceptional items and Tax Expense from continuing operations 905.04 (2,019.33) 808.57 (2,454.44)
Less: Finance Costs 1,547.28 1,616.26 1,665.62 1,733.13
(Loss) before Exceptional items and Tax Expense (642.24) (3,635.59) (857.05) (4,187.57)
Exceptional items (1,778.48) (263.13)
(Loss) before Tax Expense from continuing operations (2,420.72) (3,635.59) (1,120.18) (4,187.57)
Less: Tax Expense (Current & Deferred) (472.65) (887.53) (450.10) (877.23)
(Loss) for the year from continuing operations (1,948.07) (2,748.06) (670.08) (3,310.34)
(Loss) from discontinuing operations (382.15) (310.69)
Attributable to:
Shareholders of the Company (1,948.07) (2,748.06) (1,075.66) (3,630.22)
Non-controlling interest NA NA 23.42 9.18
Balance of profit for earlier years 53,554.69 56,820.15 52,443.60 56,595.14
Other comprehensive income/(Loss) for the year (15.85) (40.70) (15.85) (40.70)
Transfer to Legal Reserves (13.29) (3.92)
Dividend paid on Equity Shares (476.70) (476.70) (476.70) (476.70)
Balance carried forward 51,114.06 53,554.69 50,862.10 52,443.60
Non-controlling interest 62.76 29.54

2. Financial Performance, Operations and the state of the Companys affairs

Total income of the Company increased from

Rs. 32,190.19 lakhs during the previous year to Rs. 43,840.60 lakhs during the year under review. Loss after tax declined from Rs. (2,748.06) lakhs during the previous year to loss of Rs. (1,948.07) lakhs during the year under review.

On a consolidated basis, for continued operations, total income of the Company increased from

Rs. 33,584.75 lakhs during the previous year to Rs. 46,222.19 lakhs during the year under review. Loss declined from Rs. (3,310.34) lakhs during the previous year to loss of Rs. (670.08) lakhs during the year under review. For discontinued operations loss increased from Rs. (310.69) Lakhs during the previous year to loss of Rs. (382.15) Lakhs during the year under review. During the financial year ended March 31, 2023, based on the business environment and relevant economic and market indicators, the Company identified indicators of impairment of its investment related to its operations in San Francisco. Further, considering the adverse impact of Covid 19 since the launch of operations in the Kingdom of Bahrain and huge quantum of license fees payable to the Ministry of Information Affairs (MOIA), the said operations had become unsustainable in the financial year under review. As a result, the Company identified and recorded impairment of its investment related to the operations in the Kingdom of Bahrain. Kindly refer to Note 46 to the standalone financial statements and Note 49 to the consolidated financial statements for a detailed explanation.

In October 2022, the Company entered into a Share Subscription and Shareholders Agreement (‘SSHA) with Spardha Learnings Private Limited (‘Spardha) and others. As a part of SSHA, the Company subscribed to 5 equity shares and 12,932 Pre-Series A2 Compulsorily Convertible Preference Shares (‘CCPS). Total investment constitutes 11.5% of the share capital of Spardha on a fully diluted basis. Spardha is a private limited company engaged, inter-alia, in the business of providing education, training, personalised guidance, and conducting workshops in academics, music, dance, fine-arts and sports through an online platform.

The Company, through its wholly owned subsidiary- Mirchi Bahrain W.L.L., launched radio broadcasting operations in the Kingdom of Bahrain in May 2021. However, considering the adverse impact of Covid 19 since the launch of operations and huge quantum of license fees payables to the Ministry of Information Affairs - Bahrain (MOIA), the operations of the Company had become unsustainable in the current year ended March 31, 2023. Considering this, a notice of termination has been served to MOIA expressing our inability to continue services in the region due to continued losses and high license fees. In May 2021, the Companys US subsidiary, Viz. Entertainment Network, LLC (EN. LLC.) had entered into a Time Brokerage arrangement with a US based broadcaster to broadcast radio programmes and content, targeting the South Asian community in the Bay Area - USA. Due to the non-fulfilment of material contractual obligations by the counterparty, business operations of EN. LLC. became unviable. Therefore EN. LLC. issued a termination notice to the counterparty, terminating the Time Brokerage arrangement effective from November 30, 2022.

In April 2023, Honble Madras High Court pronounced its order in the matter of appeals filed by Phonographic Performance Limited (‘PPL) i.e., PPL vs the Company (‘ENIL) and others. The Order was in respect of the appeal filed by PPL in year 2010, challenging the 2% Net Advertisement Revenue (‘NAR)_ rate fixed by the then Copyright Board (‘CRB) for a period of ten years ending September 2020 (‘CRB Order). As per the said Order, the appeal filed by PPL has been partly allowed and CRB Order is upheld and further modified by fixing a minimum floor rate of Rs. 660 per needle hour

(e_ectively 2% of Net Advertisement Revenue (‘NAR) or Rs. 660 per needle hour, whichever is higher) for the period from 2010-2020. The Company will file a special leave petition before the Honble Supreme Court of India for a stay of the said order.

There were no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which these financial statements relate and the date of this Report. There has been no change in the nature of the business of the Company. There is no proceeding pending under the Insolvency and Bankruptcy Code, 2016. There was no instance of one-time settlement with any bank or financial institution.

3. Transfer to reserves

The Board of Directors (‘Board) of your Company has decided not to transfer any amount to the reserves for the financial year under review.

4. Dividend

Your Directors are pleased to recommend a dividend @ 10% i.e., Rs. 1.00 (Rupee one only) per equity share of

Rs. 10/- each for the financial year ended March 31, 2023, aggregating Rs. 476.70 lakhs. The dividend payment is subject to the approval of the shareholders at the ensuing Annual General Meeting (AGM). The Board of Directors has approved and adopted the Dividend Distribution Policy of the Company and dividend recommendation and payout are in accordance with the Companys Dividend Distribution Policy.

As per the Income-tax Act, 1961, dividends paid or distributed by the Company shall be taxable in the hands of the Members. Your Company shall, accordingly, make the payment of the dividend after deduction of tax at source.

The dividend, if declared at the AGM, would be paid within thirty days from the date of declaration of dividend through electronic mode to the Members who have updated their bank account details and dividend warrants/ demand drafts would be dispatched at the registered address of the Members who have not updated their bank account details, to those persons or their mandates: whose names appear as beneficial owners as at the end of the business hours on Friday, September 15, 2023 in the list of the Beneficial Owners to be obtained from the Depositories i.e., National Securities Depository Limited [NSDL] and Central Depository Services (India) Limited [CDSL], in respect of the shares held in electronic/ dematerialized mode; and

whose names appear as Members in the Register of Members of the Company as at the end of the business hours on Friday, September 15, 2023, in respect of the shares held in physical mode. As per the provisions of Sections 124 and 125 of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the dividend that remains unclaimed/unpaid/ un-encashed for a period of seven years and Equity Shares of the Company, in respect of which dividend entitlements have remained unclaimed or unpaid for seven consecutive years or more, are required to be transferred by the Company to the Investor Education and Protection Fund (‘IEPF), established by the Central Government. Details of the unclaimed dividend amount is available on the Company website - www.enil.co.in at the url: https:// www.enil.co.in/unclaimed-dividend.php. Calendar for transfer of unclaimed dividend to IEPF has been stated in the notes to the Notice convening the AGM. Pursuant to the guidelines issued by the IEPF Authority, Company Secretary has been nominated as the Nodal Officer to facilitate the refund of the claims of the unpaid (unclaimed) dividend (e-mail ID: mehul. shah@timesgroup.com).

The shareholders whose dividend / shares are/ will be transferred to the IEPF Authority can claim the same from IEPF Authority by following the Refund Procedure as detailed on the website of IEPF Authority: http:// www.iepf.gov.in at http://www.iepf.gov.in/IEPF/ refund.html.

The Company has transferred Rs. 16,433, being the unpaid or unclaimed dividends declared for the financial year 2014-15 and 559 equity shares to the IEPF Authority as per the provisions of Sections 124 and 125 of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016. Details of dividends and shares transferred to the IEPF Authority are available on the Company website- www.enil.co.in at the url: https://www.enil.co.in/ unclaimed-dividend.php and also on the website of IEPF Authority and the same can be accessed through the link: www.iepf.gov.in.

5. Deposits

The Company has not accepted any deposit from the public / members under Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 during the financial year under review. Consequently, there is no requirement of furnishing details related to deposit covered under Chapter V of the Companies Act, 2013.

6. Directors and Key Managerial Personnel

In accordance with the provisions of the Companies Act, 2013 (‘the Act) read with the applicable rules thereto, Mr. Vineet Jain (DIN: 00003962) retires by rotation at the ensuing AGM and being eligible, offers himself for reappointment. The Board of Directors recommends the reappointment of Mr. Vineet Jain as the Director of the Company. Mr. Yatish Mehrishi (PAN: AEXPM1887N) was appointed as the Chief Executive Officer and Key Managerial Personnel effective from November 1, 2022. Members of the Company, through Postal Ballot Voting Process on April 26, 2023, approved the reappointment of Ms. Sukanya Kripalu (DIN: 06994202) as the Independent Director for the second term of five consecutive years commencing from May 23, 2023 and also approved the appointment of Mr. Yatish Mehrishi as the Manager as per the provisions of the Companies Act, 2013 for a period of five years commencing from April 1, 2023. In May 2023, the Board of Directors considered and approved the reappointment of Mr. Subramanian Narayanan (Mr. N. Subramanian) (DIN: 03083775) as the Executive Director & Group Chief Financial Officer (‘ED & Group CFO) of the Company for the term of five years commencing from November 2, 2023. Mr. Prashant Panday resigned from the position of the Managing Director as well as Directorship of the Company with effect from the close of business hours on January 31, 2023 due to other preoccupations. The Board of Directors places on record their appreciation for the invaluable contributions made by Mr. Prashant Panday, Managing Director, who has served the Company for more than two decades and built the Brand Mirchi into a power brand over the last twenty-two years.

The Company has received the consent, declarations and confirmations from all the Independent Directors of the Company pursuant to the provisions of Section 149 and all other applicable provisions of the Act and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 [‘Listing Regulations] stating that they meet the criteria of independence as provided under the Act and the Listing Regulations and that they are not disqualified to become directors under the Act. All the Independent Directors have confirmed that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence and that they are independent of the management. The Board of Directors took on record the said declarations and confirmations submitted by the Independent Directors under applicable provisions of the Act and the Listing Regulations after undertaking due assessment of the veracity of the same. In the opinion of the Board of Directors, all the Independent Directors fulfill the criteria of independence as provided under the Act, rules made thereunder, read with the Listing Regulations and that they are independent of the management. The Board of Directors is of the opinion that all the Independent Directors of the Company hold the highest standards of integrity and possess requisite expertise and experience required to fulfill their duties as Independent Directors.

All the Independent Directors have confirmed that they have complied with the provisions of Section 150 of the Companies Act, 2013 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014 regarding applying online to the Indian Institute of Corporate Affairs at Manesar (‘IICA) for inclusion of their names in the databank maintained by IICA and also filed the application for renewal of the same. They have also confirmed that they are exempted from the requirement to pass the online proficiency self-assessment test under the aforesaid Rule.

The Independent Directors have complied with the Code for Independent Directors prescribed in Schedule IV to the Act and the Code of Conduct for directors and senior management personnel formulated by the Company.

The Company has received all the relevant consent, documents, declarations, confirmation from the director proposed to be reappointed and he is not disqualified to become the director under the Act. As per the requirement of the circular from the stock exchange (no: LIST/COMP/14/2018-19 Dated June 20, 2018), the Board of Directors and its Nomination and Remuneration Committee, while considering the appointment and reappointment of the directors, have verified that they are not debarred from holding the office of director pursuant to any SEBI order or any other such authority. Accordingly, the Company afirms that the Director proposed to be reappointed is not debarred from holding the office of director by virtue of any SEBI order or any other such authority. Certificate from the Company Secretary in Practice has been attached with the Report of Corporate Governance, confirming that none of the directors on the Board of the Company have been debarred or disqualified from being appointed or continuing as directors of companies by the Board (SEBI)/ Ministry of Corporate Affairs or any such statutory authority. As stipulated under the Listing Regulations and Secretarial Standards, details in respect of the director seeking reappointment at the AGM, inter-alia, age, qualifications, experience, details of remuneration last drawn by such person, relationship with other directors and Key Managerial Personnel of the Company, the number of Meetings of the Board attended during the year and other directorships, membership/ chairmanship of the committees of other Boards, shareholding, etc. are annexed to the Notice convening the AGM.

None of the Directors are related with each other or key managerial personnel (inter-se). Details of the number of meetings of the Board of Directors and Committees and attendance at the meetings have been furnished in the Report on Corporate Governance. Following persons are designated as the Key Managerial Personnel (KMP):

Mr. Yatish Mehrishi: Manager & Chief Executive Officer

Mr. N. Subramanian: Executive Director & Group CFO

Mr. Mehul Shah: EVP Compliance & Company Secretary

7. Annual evaluation of performance of the Board, its Committees and individual directors

The Board of Directors is committed to continued improvement in its effectiveness. Accordingly, the Board, its Committees and individual directors participated in the annual formal evaluation of its performance. This was designed to ensure, amongst other things, that the Board, its Committees and each director continue to contribute effectively.

Evaluation of the performance of the Board, its Committees and individual directors involved structured questionnaire-driven discussions that covered a number of key areas / evaluation criteria including the roles and responsibilities, size and composition of the Board and its Committees, meaningful and constructive contribution and inputs in the meetings, dynamics of the Board and its Committees and the relationship between the Board and management. Chairman of the Board of Directors had meetings with the Independent Directors. Chairman of the Nomination & Remuneration Committee had meetings with the Non- Independent Directors. Independent Directors, at their Meeting led by the Chairman of the Nomination & Remuneration

Committee, reviewed the performance of the Chairman, Non-Independent Directors and the Board as a whole in respect of the financial year under review. The Independent Directors, in the said meeting, also assessed the quality, quantity and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform their duties. These meetings were intended to obtain Directors inputs on effectiveness of the Board/ Committee processes. The evaluation of the Independent Directors was done by the entire Board of Directors which included performance of the Directors and fulfillment of the independence criteria as specified in the Listing Regulations and their independence from the management. In the above evaluation, the Directors who were subject to evaluation did not participate. The results of the evaluation were discussed with the relevant Committees and collectively by the Board as a whole. Constructive feedback was also sought on the contributions of individual Directors. Formal Annual Evaluation was made in compliance with all the applicable provisions of the Act and the Listing Regulations. During the Board Evaluation, it was observed that the Board of Directors, as a whole, is functioning as an integrated body helping the board discussion to be rich and value adding. The Board has an optimum balance of discussion between operational and strategic issues. The Board is proactively engaged on the key matters concerning talent, strategy, governance, etc. There are specific areas identified by the Board as a part of this evaluation exercise for the Board to engage itself with. The Directors were satisfied with the evaluation results, which reflected the overall engagement of the Board and its Committees with the Company.

8. Board Familiarization Program

At the time of appointment of a new director, through the induction process, he/ she is familiarized with the Company, directors roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, etc. Detailed presentations are made before the Board Members at the Board and its Committee meetings covering various areas including business strategy, branding, programming, financial performance and forecast, compliances/ regulatory updates, audit reports, risk assessment and mitigation, etc. The details of the familiarization program are available on the Companys website at: https://www.enil.co.in at web link: https://www.enil.co.in/policies-and-code-of-conduct.php

9. Policy on directors appointment and remuneration

The Companys Policy on the Directors appointment and remuneration including criteria for determining qualifications, positive attributes, independence of director and other matters as provided under Section 178 of the Act is titled as Nomination & Remuneration Policy, and is available on the Companys website at: https://www.enil.co.in at web link: https://www.enil. co.in/policies-and-code-of-conduct.php and also appended as Annexure A to this Report.

10. Vigil Mechanism

The Company has an adequate and functional ‘Whistle Blower Policy / ‘Vigil Mechanism in place. The objective of the Vigil Mechanism is to provide the employees, directors, customers, vendors, contractors and other stakeholders of /in the Company an impartial and fair avenue to raise genuine concerns about unethical behaviour, actual or suspected fraud or violation of the Companys code of conduct and seek redressal, in line with the Companys commitment to the highest possible standards of ethical, moral and legal business conduct and fair dealings with all its stakeholders and constituents and its commitment to open communication channels. Vigil Mechanism provides adequate safeguards against victimization of persons who use such mechanism for whistle blowing in good faith and it also ensures that the interests of the person who uses such Mechanism are not prejudicially affected on account of such use. The Board of Directors afirms and confirms that no personnel have been denied access to the Audit Committee. The Policy contains the provision for direct access to the Chairperson of the Audit Committee in appropriate or exceptional cases. Whistle Blower Policy/ Vigil Mechanism is available on the Companys website at: https://www.enil.co.in at web link: https://www.enil.co.in/policies-and-code-of-conduct.php

11. Audit Committee

The Audit Committee of the Company consists of the following Directors as on the date of this Report:

Mr. N. Kumar – Chairman (Independent Non- Executive Director)

Mr. Ravindra Kulkarni (Independent Non- Executive Director)

Mr. Richard Saldanha (Independent Non- Executive Director)

Ms. Sukanya Kripalu (Independent Non- Executive Director)

The Internal Auditors of the Company report directly to the Audit Committee. All the recommendations of the Audit Committee were accepted by the Board of Directors. Brief description of terms of reference and other relevant details of the Audit Committee have been furnished in the Report on Corporate Governance.

12. CSR Committee

The constitution, composition, quorum requirements, terms of reference, role, powers, rights, obligations of Corporate Social Responsibility Committee [‘CSR Committee] are in conformity with the provisions of Section 135 and all other applicable provisions of the Companies Act, 2013, read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 and all other applicable rules made under the Companies Act, 2013 (including any statutory modification(s) or re-enactment or amendments thereof).

The CSR Committee of the Company consists of the following Directors as on the date of this Report:

Mr. Vineet Jain – Chairman (Non- Executive Director)

Mr. Ravindra Kulkarni (Independent Non- Executive Director)

Mr. N. Subramanian (Executive Director & Group CFO) During the financial year under review, the Committee met on May 6, 2022.

Brief description of terms of reference of the Committee inter-alia includes:

Formulating and recommending to the Board of Directors (Board), a Corporate Social Responsibility (CSR) Policy which shall indicate the activities to be undertaken by the Company as specified in Schedule VII of the Companies Act, 2013;

Recommending the amount of expenditure to be spent on the CSR activities to be undertaken by the Company;

Monitoring the CSR Policy of the Company from time to time;

Formulating and recommending to the Board, an Annual Action Plan in pursuance of its CSR Policy, which shall include: – the list of CSR projects or programmes that are approved to be undertaken in areas or subjects specified in Schedule VII of the Act; – the manner of execution of such projects or programmes;

– the modalities of utilisation of funds and implementation schedules for the Provided projects or programmes; – monitoring and reporting mechanism for the projects or programmes; and – details of need and impact assessment, if any, for the projects undertaken by the company;

Approving specific projects, either new or ongoing, in pursuance of the CSR Policy and the Annual Action Plan;

Recommending to the Board any alteration in the Annual Action Plan approved by the Board along with reasonable justification;

Monitoring, reviewing the progress of the CSR initiatives undertaken and reporting of the CSR activities to the Board from time to time;

Satisfying the Board on the utilization of the funds disbursed for the purpose and in the manner approved by it;

Reviewing and recommending to the Board, the Annual Report on CSR activities to be included in the Boards report;

Reviewing and recommending to the Board, if and to the extent applicable, the need for impact assessment of the projects and appointment of impact assessment agency and the impact assessment report to be obtained by the Company from time to time;

Undertaking such activities and carrying out such functions as may be provided under Section 135 of the Act and the rules issued thereunder.

CSR Policy development and implementation:

The CSR Policy is available on the Companys website at: https://www.enil.co.in at web link: https://www. enil.co.in/policies-and-code-of-conduct.php

CSR Policy Statement and Annual report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 have been appended as Annexure B to this Report.

13. Nomination and Remuneration Committee

The Nomination and Remuneration Committee of the Company comprises of the following Directors as on the date of this Report:

Mr. N. Kumar – Chairman (Independent Non- Executive Director)

Mr. Ravindra Kulkarni (Independent Non- Executive Director)

Mr. Richard Saldanha (Independent Non- Executive Director)

Ms. Sukanya Kripalu (Independent Non- Executive Director)

Mr. Vineet Jain (Non- Executive Director)

Brief description of terms of reference and other relevant details of the Nomination and Remuneration Committee have been furnished in the Report on Corporate Governance.

14. Stakeholders Relationship Committee

The Stakeholders Relationship Committee of the Company comprises of the following Directors as on the date of this Report:

Mr. Richard Saldanha – Chairman (Independent Non- Executive Director)

Mr. Ravindra Kulkarni (Independent Non- Executive Director)

Mr. N. Subramanian (Executive Director & Group CFO) Brief description of terms of reference and other relevant details of the Stakeholders Relationship Committee have been furnished in the Report on Corporate Governance.

15. Audit Report

The Audit Report does not contain any qualification, reservation or adverse remark or disclaimer. The Statutory Auditors of the Company have not reported any details in respect of frauds as specified under Section 143(12) of the Act.

16. Auditors

The Members of the Company, at the 23rd AGM held on September 27, 2022, had approved the appointment of Walker Chandiok & Co LLP, Chartered Accountants (ICAI Firm Registration number - 001076N/ N500013) as the Statutory Auditors of the Company for a term of five consecutive years, to hold the office commencing from the conclusion of the 23rd AGM till the conclusion of the 28th AGM. Walker Chandiok & Co LLP, Chartered Accountants have stated that they satisfy the criteria provided in Section 141 of the Act.

17. Secretarial Auditor and report

The Board of Directors had appointed M/s. Hemanshu Kapadia & Associates, Company Secretaries (C. P. No: 2285), to conduct Secretarial Audit for the financial year 2022-23. The Secretarial Audit Report for the financial year ended March 31, 2023 is appended as Annexure C-1 to this Report. The Secretarial

Compliance Report for the financial year ended March 31, 2023 is appended as Annexure C-2 to this Report. The Secretarial Audit Report dated April 30, 2023 and Secretarial Compliance Report dated April 30, 2023 do not contain any qualification, reservation or adverse remark or disclaimer.

18. Cost Auditor and report

The Board of Directors, on recommendation of the Audit Committee and pursuant to Section 148 and all other applicable provisions of the Act, read with the Companies (Audit and Auditors) Rules, 2014 and all other applicable rules made under the Act (including any statutory modification(s) or re-enactment thereof for the time being in force), has approved the appointment and remuneration of the Cost Auditors, M/s. R. Nanabhoy & Co., Cost Accountants (Firm registration number- 00010) to conduct the audit of the cost records of the Company for the financial year ending on March 31, 2024. The aforesaid appointment of M/s. R. Nanabhoy & Co. is subject to the relevant notifications, orders, rules, circulars, etc. issued by the Ministry of Corporate Affairs and other regulatory authorities from time to time. The remuneration payable to M/s. R. Nanabhoy & Co. shall be Rs. 4,75,000 (Rupees four lakhs seventy five thousand only) plus out of pocket expenses and applicable taxes for the aforesaid audit. The remuneration payable to the Cost Auditors is required to be ratified subsequently by the shareholders. Accordingly, consent of the members has been sought for passing the resolution as set out at Item No. 4 of the Notice convening the AGM for ratification of the remuneration payable to the Cost Auditors for the financial year ending on March 31, 2024.

Maintenance of cost records as specified by the Central Government under Sub-section (1) of Section 148 of the Companies Act, 2013, is required by the Company and accordingly, such accounts and records are made and maintained.

The Cost Audit Report for the financial year 2021-22 was filed on September 3, 2022. The Cost Audit Report for the financial year 2022-23 will be filed on/ before the due date.

19. Conservation of Energy, Technology absorption and Foreign exchange earnings and Outgo

The Company is in the business of Private FM Radio Broadcasting. Hence, most of the information required to be provided relating to the Conservation of energy and Technology absorption is not applicable.

However, the information, as applicable, is given hereunder:

(a) Conservation of energy:

(i) Steps taken or impact on conservation of energy and the steps taken by the Company for utilising alternate sources of energy:

– Energy Conservation: We increased the efforts already executed in the preceding years by regulating the electrical consumption at the transmitters, studios and offices, which has resulted in substantial savings in energy cost in the financial year under review.

– Optimization of office spaces: As a part of our continuous efforts in office space restructuring, we rationalised office space at more locations with an efficient office design using LED lights and energy efficient electronic devices that has contributed to reduction of about 40% in the energy consumption.

– We have maximized energy savings in AC units. Air conditioner (AC) usage patterns are monitored regularly to reduce electricity consumption without any extra capital investment. AC units are set at optimum temperatures based on ambient conditions, e.g., Studio ACs are set at not less than 25 degrees temperature. This has helped achieve substantial savings. Transmitter power is optimally reduced in the night band when listenership is low, and the ambient temperature is lower. We continue to replace old conventional fixed speed ACs with Inverter/ VRV ACs for better energy savings.

– We have successfully implemented a pilot project by installing a Smart Room Cooling (SRC) at a transmission site for energy savings in air-conditioning. Existing comfort ACs were replaced with a highly efficient industry grade product. Due to its longer life, capex will be avoided for around 10-12 years which otherwise would be incurred on replacing regular ACs periodically. The product has higher airflow with lower energy consumption resulting in a short payback period.

– UPS upgrades and load reassessment helped us reduce our connected load across stations over the years by more than 300 KW.

(ii) Capital investment on energy conservation equipments: Rs. 6.30 lakhs

(b) Technology absorption:

(i) The efforts made towards technology absorption and benefits derived like product improvement, cost reduction, product development or import substitution: Your Company has consistently taken initiatives to improve productivity and increase efficiencies in processes.

– A Contest and Merchandise management tool was developed in SharePoint and hosted on Azure Cloud. The workflow increased efficiency and improved inventory management in the Contest management process. The tool also simplifies the process of monitoring contest entries and managing winners, making it easier to track and measure the success of contests.

– A Creative brief approval workflow was developed and deployed on SharePoint and hosted on the MS Azure Cloud. We automated the process of filing a creative brief to Programming or Brewery teams for their review and approval. The workflow is currently used by teams in 55 stations, substantially improved productivity, saved time and helps archive creatives for future reference.

– HR onboarding process was automated with SAP and integrated with satellite system. This has resulted in reducing the turn-around-time of the HR team for hiring and data synchronization, increased efficiency and reduced operating costs.

– An API solution was developed for automating customer payment transactions made through HDFC Bank. The inbound interface developed between HDFC Bank and SAP ERP enabled us to reduce manual effort and errors, provide daily receipts reconciliation and track new customers, thus increasing team productivity.

– Hub Station Optimization: Successfully replicated Hub station optimization for remote networked stations in Maharashtra. The centralized solution resulted in optimal use of manpower and resources and savings in both capex and operating expenses.

– RCS ZettaCloud on Triton: Implemented RCS ZettaCloud for playout of 39 deferred streams of 13 FM stations in 3 different time zones (PST, EST, GST) on the Triton audio streaming platform for Mirchi App.

– Infrastructure enhancement: With the focus on Digital businesses, we expanded the infrastructure of our existing private cloud. This not only augmented our goal of space and energy savings, but also gave us the complete control of setting up new playout systems instantly by using the scalability and flexibility parameters of the private cloud.

– We continue to replace older analog consoles with IP consoles due to their ease of installation, maintenance and flexibility.

– Benefits derived: Improvement in processes, higher productivity, cost effectiveness, time-savings, energy conservation are some of the major benefits derived.

(ii) Imported technology (imported during last three years reckoned from the beginning of the financial year): The Company has not imported any new technology in this financial year. Nevertheless, the Company has continued to use the latest equipment and software for its business activities. (iii) The expenditure incurred on Research & Development (R & D): The Company has not spent any amount towards research and development activities. The Company has been active in harnessing the latest technology available in the industry.

(c) Foreign exchange earnings and outgo:

The Foreign Exchange earned in terms of actual inflows during the year and the Foreign Exchange outgo during the year in terms of actual outflows.

Financial Year 2022-23 Financial Year 2021-22
Foreign exchange earnings 1,249.11 643.91
Foreign exchange outgo 816.79 1,212.05

20. Particulars of Employees

Disclosures pertaining to remuneration and other details as required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are appended as Annexure D to this Report.

The Managing Director and Executive Director of the Company do not receive any remuneration or commission from the Companys holding or subsidiary companies. As per the provisions of Section 197 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 relevant particulars of the employees drawing remuneration in excess of the limits set out in the said rules forms part of the Annual Report. As per the second proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. The said information is made available for inspection by the Members in electronic mode basis the request being sent on enil.investors@timesgroup.com without payment of fee and same will also be available during the AGM. Any Member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request. The Annual Report is available on the Companys website at: www.enil.co.in.

21. Annual Return

Pursuant to Section 92(3) read with Section 134(3) (a) of the Act, the Annual Return of the Company is available at the Companys website: (https://www. enil.co.in) at url: https://www.enil.co.in/financials-annual-reports.php.

22. Share Capital & Listing of Securities

During the financial year under review, the Company has not issued: any shares, debentures, bonds, warrants or securities; any equity shares with differential rights as to dividend, voting or otherwise; any shares to its employees under the Employees Stock Option Scheme; any sweat equity shares.

During the financial year under review, the Company has not bought back its shares, pursuant to the provisions of Section 68 of the Companies Act, 2013 and Rules made thereunder.

No shares are held in trust for the benefits of employees. There is no change in the capital structure of the Company during the financial year under review. The equity shares of the Company are listed on BSE Limited (BSE) and National Stock Exchange of India Limited (NSE) since February 15, 2006. Annual Listing Fee has been paid to each exchange. As required under the Listing Regulations, the Company has executed the Uniform Listing Agreement with BSE and NSE.

23. Management Discussion and Analysis Report

Management Discussion and Analysis Report for the financial year under review as stipulated under Regulation 34 of the Listing Regulations is set out in a separate section forming part of this Report. The Company has adopted Integrated Reporting. The information related to the Integrated Reporting forms part of the Management Discussion & Analysis and Integrated Reporting has also been hosted on the website of the Company: (https://www.enil.co.in) at url: https://www.enil.co.in/financials-annual-reports. php.

24. Business Responsibility & Sustainability Report

As per Regulation 34 of the Listing Regulations, the Company has published a separate Business Responsibility & Sustainability Report (‘BRSR) for the financial year under review and is attached as Annexure E to this Report.

25. Corporate Governance

The Company is adhering to good corporate governance practices in every sphere of its operations. The Company has taken adequate steps to comply with the applicable provisions of Corporate Governance as stipulated under the Listing Regulations. A separate

Report on Corporate Governance is enclosed as a part of this Report along with the Certificate from the Practicing Company Secretary.

26. Secretarial Standards

The Company complies with the applicable mandatory Secretarial Standards issued by the Institute of Company Secretaries of India.

27. Directors Responsibility Statement

Pursuant to the provisions of Section 134 of the Companies Act, 2013, the Directors hereby confirm that: (a) in the preparation of the annual accounts for the financial year ended on March 31, 2023, the applicable accounting standards have been followed and that there are no material departures from the same;

(b) they have 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 ended on March 31, 2023 and of the 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 Companies Act, 2013 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 for the Company and such internal financial controls are adequate and operating effectively; and (f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

28. Contracts and arrangements with related parties

All contracts / arrangements / transactions entered into by the Company during the financial year under review with related parties were in the ordinary course of business and on an arms length basis. Bennett, Coleman & Company Limited (‘BCCL) is the holding company and a related party under Section 2(76) of the Companies Act, 2013 and Regulation 2(1) (zb) of the Listing Regulations.

In order to achieve efficiencies in Ad sales, business synergies, economics of scale and also to optimize costs, the Company and BCCL have entered into various contracts/ arrangements/ transactions relating to the transfer and / or availing of resources, services or obligations in the past and propose to continue with such contracts/ arrangements/ transactions in the future too.

In compliance with Regulation 23 of the Listing Regulations, Members of the Company granted approval for the contracts/ arrangements/ transactions entered into and/ or to be entered into with BCCL relating to the transfer and / or availing of resources, services or obligations, for each of the five financial years of the Company commencing from April 1, 2020, exceeding ten percent of the annual consolidated turnover of the Company as per the last audited financial statements of the Company but not exceeding the aggregate value of Rs. 200 crore (Rupees two hundred crore only) per annum, on such terms and conditions as may be mutually agreed between the Company and BCCL. Details of the Material Related Party Transactions entered during the year by the Company, as required under Section 134(3) (h) of the Act (in the Form AOC 2) is attached as Annexure F to this Report.

The Companys Policy on Materiality of related party transactions and dealing with related party transactions is available on the Companys website at: www.enil.co.in (url: https://www.enil.co.in/policies-and-code-of-conduct.php).

The related party transactions are entered into based on business exigencies such as synergy in operations, profitability, market share enhancement etc. and are intended to further the Companys interests. In accordance with the applicable accounting standards, transactions with related parties are furnished in the financial statements.

29. Dividend Distribution Policy

The Company has formulated a Dividend Distribution Policy as required under the Regulation 43A of the Listing Regulations. The said Policy is appended as Annexure G to this Report and also uploaded on the Companys website at www.enil.co.in (url: https:// www.enil.co.in/policies-and-code-of-conduct.php).

30. Particulars of loans given, investment made, guarantees given and securities provided

The Company has not given any guarantees or provided any securities under Section 186 of the Act. Particulars of loan given to the subsidiary company are provided in Note 39 to the standalone financial statements and the said loan was repaid during the financial year under review. The loan was given for business purposes. Particulars of investments made by the Company during the financial year 2022-23 are provided in Note 8 to the standalone financial statements.

31. Risk Management

The Board of Directors is responsible for ensuring that the Company has appropriate systems of control in place - in particular, systems for risk management, financial and operational control, and compliance with the laws and relevant standards. Accordingly, the Board oversees the framing, implementing and the monitoring of the risk management plan for the Company. The Board also ensures the integrity of the Companys accounting and financial reporting systems, including the independent audit.

The Audit Committee reviews adequacy and effectiveness of the Companys internal control environment and monitors the implementation of audit recommendations, including those relating to strengthening of the Companys Risk Management policies, systems and procedures. Internal Audit for the financial year under review has been carried out by Deloitte Touche Tohmatsu India Limited Liability Partnership (‘Deloitte), the independent Internal Auditors. Internal Audit covers key radio stations at pan India level and the corporate office as per the annual audit plan approved by the Audit Committee. Internal Audit report is presented to the Audit Committee on regular basis and the Chairman of the Audit Committee briefs the Board of Directors about the same.

The Company has adopted a Risk Management Policy pursuant to the provisions of Section 134 and all other applicable provisions of the Companies Act, 2013 and Listing Regulations and also established related procedures to inform Board Members about the risk assessment and minimization procedures. The Company has a strong Enterprise Risk Management framework which is administered by the Senior Management team and monitored by the Risk Management Committee. Major risks are identified and mitigation measures are put in place, and the same are also reported to the Audit Committee and Board of Directors along with the action taken report. The Risk Management Policy envisages assessment of strategic risks, operational risks, financial risks, regulatory risks, human resource risks, technological risks. The Risk Management Policy adopted by the Company involves identification and prioritization of risk events, categorization of risks into High, Medium and Low based on the business impact and likelihood of occurrence of risks and Risk Mitigation & Control. The Risk Management Committee of the Company comprises of the following members as of the date of this Report:

Mr. Vineet Jain (Non-Executive Chairman)

Mr. N. Kumar (Independent Director)

Mr. N. Subramanian (Executive Director & Group CFO)

Mr. Yatish Mehrishi (CEO)

A brief description of terms of reference and other relevant details of the Risk Management Committee have been furnished in the Report on Corporate Governance.

32. Internal Financial Controls

The 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 information. The Company has in place adequate internal financial controls with reference to the financial statements. The Companys internal control systems, including internal financial controls, are commensurate with the nature of its business and the size and complexity of its operations and same are adequate and operating effectively. These systems are periodically tested and no reportable material weakness in the design or operation was observed. The Audit Committee reviews the adequacy and effectiveness of the Companys internal control system including internal financial controls.

33. Consolidated Financial Statements

In accordance with the Companies Act, 2013 and applicable accounting standards, the audited consolidated financial statements are provided and form part of the Annual Report.

34. Subsidiary Companies

The Company has the following subsidiaries:

Alternate Brand Solutions (India) Limited (ABSL), a 100% subsidiary based in India. ABSL recorded a total income of Rs. 46.25 lakhs during the financial year ended March 31, 2023, as compared to

Rs. 89.52 lakhs during the financial year ended March 31, 2022. Profit after Tax stood at Rs. 32.57 lakhs for the financial year ended March 31, 2023, as compared to Profit of Rs. 32.57 lakhs during the financial year ended March 31, 2022.

Entertainment Network, INC (EN, INC) and a step-down subsidiary, Entertainment Network, LLC (EN, LLC) based in the United States of America. EN, INC is a 100% subsidiary of the Company. EN, LLC is the 100% subsidiary of EN, INC. EN, INC recorded a total consolidated income of

Rs. 1,515.38 lakhs during the financial year ended March 31, 2023, as compared to Rs. 1,000.46 lakhs during the financial year ended March 31, 2022. Consolidated loss after Tax stood at Rs. (359.91) lakhs for the financial year ended March 31, 2023 as compared to loss of Rs. (617.88) lakhs during the financial year ended March 31, 2022.

Global Entertainment Network Limited (GENL) (A company incorporated under the laws of the State of Qatar having its registered office in Doha, Qatar). In March 2021, the Company acquired 49% equity of GENL. The remaining 51% of the equity stake is owned by another company (Marhaba FM). Basis the shareholding agreement executed by the Company with Marhaba FM, the Company has a controlling interest over GENL. As a result, the investment made in GENL is treated as an investment in a subsidiary as per Ind AS 110- Consolidated Financial Statements. GENL recorded a total income of Rs. 970.66 lakhs during the financial year ended March 31, 2023, as compared to Rs. 472.86 lakhs during the financial year ended March 31, 2022. Profit after Tax stood at Rs. 82.71 lakhs for the financial year ended March 31, 2023, as compared to Profit of Rs. 36.74 lakhs during the financial year ended March 31, 2022.

Mirchi Bahrain WLL, based in the Kingdom of Bahrain, is a 100% subsidiary of the Company. Mirchi Bahrain WLL became a wholly owned subsidiary of the Company in April 2021. Mirchi Bahrain WLL recorded a total income of

Rs. 462.94 lakhs during the financial year ended March 31, 2023, as compared to Rs. 393 lakhs during the financial year ended March 31, 2022. Consolidated loss after Tax stood at Rs. (374.53) lakhs for the financial year ended March 31, 2023, as compared to loss of Rs. (324.58) lakhs during the financial year ended March 31, 2022.

As per Section 129 of the Companies Act, 2013, a separate statement containing the salient features of the financial statements of the Subsidiary Companies is attached along with the financial statements in the prescribed Form AOC-1. The Company does not have any associate company or joint venture. There has been no change in the nature of the business of the subsidiaries.

The Company shall make available the financial statements and the related detailed information of its subsidiaries to any Member of the Company or its subsidiaries who may be interested in obtaining the same at any point of time and same is also available on the website: www.enil.co.in. These documents will also be available for inspection by the Members in electronic mode basis the request being sent on enil.investors@timesgroup.com without payment of fee and same will also be available during the AGM. The consolidated financial statements presented by the Company include financial results of its Subsidiary Companies.

The audited financial statements, including consolidated financial statements and all other relevant documents required to be attached thereto are available on the Companys website: www.enil. co.in.

The Policy for determining material subsidiaries is available at the Companys website: www.enil.co.in at https://www.enil.co.in/policies-and-code-of-conduct.php

35. Significant and material order

During the financial year under review, no significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and the Companys operations in future.

36. Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

Your Company has always believed in providing a safe and harassment-free workplace for every individual working in the Company. For building awareness in this area, the Company has been conducting induction/ refresher programmes on a continuous basis. The Company has in place a Policy for prevention of Sexual Harassment at the Workplace in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013, and the Company has complied with the applicable provisions of the said Act. Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. During the financial year under review, one complaint pertaining to sexual harassment was reported to the Internal Complaints Committee of the Company. After a detailed investigation and following due procedure under the applicable law, guidelines and regulations, the said complaint was appropriately dealt with during the financial year under review and appropriate action was taken.

37. Acknowledgements

Your Directors take this opportunity to convey their appreciation to all the members, listeners, advertisers, media agencies, dealers, suppliers, bankers, regulatory and government authorities and all other business associates for their continued support and confidence in the management of the Company. Your Directors are pleased to place on record their appreciation for the consistent contribution made by the employees at all levels through their hard work, dedication, solidarity and co-operation.

For and on behalf of the Board of Directors

sd/-

Vineet Jain

Chairman

Delhi, May 4, 2023 (DIN: 00003962)
Registered Office:
Entertainment Network (India) Limited,
CIN: L92140MH1999PLC120516,
4th Floor, A-Wing, Matulya Centre,
Senapati Bapat Marg, Lower Parel (West),
Mumbai - 400 013.
www.enil.co.in

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