Dear Shareholders,
On behalf of the Board of Directors, it is our pleasure to present the 18th
Annual Report of FIDEL SOFTECH LIMITED together with the Audited Statement of Accounts for
the year ended March 31, 2023.
I. Highlights of Financial Performance
The Company has recorded the following financial performance, for the year ended March
31, 2023:
Cr
| Particulars |
2022-23 |
2021-22 |
| Revenue |
34.24 |
26.88 |
| EBITDA |
7.42 |
6.47 |
| Profit Before Tax |
7.15 |
6.29 |
| PBT % |
21% |
23% |
| Profit After Tax |
5.39 |
4.56 |
| PAT % |
16% |
17% |
| Earnings Per Share |
4.13 |
4.52 |
A detailed analysis of the Financial highlights/summary are included elsewhere in this
Report.
At your Company, we prioritize maintaining exceptional corporate governance standards.
The Board of Directors plays a vital role in providing diligent oversight, offering
valuable guidance, and setting strategic direction to facilitate effective decision-making
and robust risk management practices. We are dedicated to upholding applicable laws,
regulations, and ethical standards, which fosters transparency and accountability
throughout our operations.
While it is statutorily mandated for Small and Medium Enterprises (SME) listed
companies to publish their financial results on a half-yearly basis, we go the extra mile
by voluntarily declaring our Un-audited Financial results on a quarterly basis. This
proactive approach aligns with our commitment to practicing good corporate governance and
ensures timely and comprehensive disclosure of our financial performance to stakeholders.
II. Dividend
Your Directors are pleased to recommend a dividend of 0.70/- per equity share of face
value 10/- each for the current financial year.
III. Summary of Operations
During the year, your Company experienced a remarkable increase in net revenue from
operations, rising by 27% from 26.31 Cr to 33.37 Cr. This impressive growth can be
attributed to the combination of higher sales volumes and the effective implementation of
market penetration strategies.
Despite the overall positive results, the Companys profit before tax showed a slight
decline of 2% from 7.15 Cr (21%) to 6.29 Cr (23%) compared to the previous year. This
decrease can be primarily attributed to the higher expenses incurred in business
development activities. The closing balance of Reserves, including retained earnings of
the Company as at March 31, 2023 is 1865.07 Lakhs
Fidel continued to execute its expansion plans successfully, both in domestic and
international markets. This strategic endeavor played a crucial role in driving revenue
growth and gaining market share. The financial performance of Fidel in the current
Financial Year serves as a testament to the effectiveness of our growth strategies and
unwavering commitment to operational excellence.
The Global IT industry experienced fluctuations and slowdowns in the past year due to
various factors, such as economic downturns, geopolitical events, technological shifts,
streamlining of resources, and market saturation. These slowdowns had moderate impact on
the Indian IT industry as a whole, affecting companies, employment rates, and investments.
Globally LangTech is a 40 billion USD plus market and growing at YoY 10% and above.
Fidel Softech continued to grow in this economy relying on its strong fundamentals
planned spending and presence in multiple geographies.
It is important to note that the IT industry is highly dynamic and resilient. It has in
the past also demonstrated consistent growth over the years, driven by advancements in
technology and digital transformation initiatives.
Fidel works closely with clients and helps them with implementing IT solutions and
services with the last mile delivery in local languages while leveraging its capabilities
in both the Language (and Linguistics) + Technology. In few instances Fidel has tighter
integration with clients through API connectivity, which proves beneficial for a long-term
partnership. It has the capability to localize and support 100+ languages with in-house
capabilities for 8 core Indian languages and Japanese language.. Its Inhouse linguistic +
technical expertise assures fast turnaround time as well as quality to its customers.
Strong technical capabilities to handle multiple file formats, different CMS, different
technologies (e.g., python / php / .net / Java / mysql / NLP / Audio-video technologies)
as well as capabilities to support enterprise products and digital transformation
initiatives, AI-ML data analytics initiatives enables Fidel to provide a comprehensive
array of services to its clients across geographies. Fidel is well positioned to leverage
the growth in AI domain with its expertise in multi-lingual data collection, data
modelling, data training and fine-tuning. Its focus on Japan which is a much stable and
mature market also helps it to balance the fluctuations in other geographies.
IV. Material changes or financial occurrences including details of Initial Public
offering (IPO) of the Equity Shares of the Company.
During the financial year Company was converted from a Private Company to a Public
Company. Further, the Company was listed on NSE EMERGE (SME) Platform of NSE on June 10,
2022. Your Company has received a tremendous response from the Investor Community,
resulting in an oversubscription of its Initial Public Offer by 101 times. The unwavering
support and trust shown by the investors over the last year boosted the morale of the
Company. In these dynamic and ever-changing times, the new investment has enabled your
Company with the resources necessary to drive innovation, expand its operations, and seize
new opportunities. This support not only contributed to Companys growth but also played a
vital role in fostering economic development, creating job opportunities, and driving
positive change in its Stakeholders.
The Initial Public Issue (IPO) opened for subscription on Monday, May 30, 2022, and
closed on Thursday, June 02, 2022. The shares of Face Value of 10.00 each ("Equity
Shares") were offered for issue at a price of 37.00 per Equity Share (including a
premium of 27.00 per Equity Share). Entire issued, subscribed and fully paid- up of
1,37,50,560 Equity Shares of the Company were listed on the NSE EMERGE - the SME platform
of National Stock Exchange of India Limited (NSE) at an opening price of 62.00 per
Share.
The Board of Directors are monitoring the Utilization of Funds raised from IPO
including approval of modification of any limits. The statement of deviation and
Utilization of IPO funds is available on the website of the Company.
There was no change in the nature of business during the year under review.
V. Statement of deviation(s) or variation(s) in accordance with regulation 32 of SEBI
Listing Obligations and Disclosure Requirements (LODR) Regulations, 2015:
In accordance with the offer document of the Initial Public Offer, the Company had
estimated utilization of 943.32 Lakhs towards Funding Working Capital requirements of
the Company and 269.95 Lakhs towards General Corporate Purposes for the financial year
ended 2022-23. The actual utilization was 287.48.43 Lakhs in total and 167 Lakhs still
remained unutilized. There was a shortfall in utilization of funds as the Company had
undertaken a conservative approach on spend of the funds raised. Fidel believes that spend
has to be made on the right opportunities and at the right time, rather than spending to
meet targets. It was a strategic call to delay the spend.
VI. Annual Return
As per the Companies (Management and Administration) Amendment Rules, 2020 dated 28th
August, 2020,of the Companies Act, 2013 (the Act),the Annual Return of the Company is
uploaded on the website of the Company at https://www.fidelsoftech.
com/other-disclosures/
VII. Directors & Key Managerial Personnel (KMP)
The detailed profile of the Board of Directors is available on the website of the
Company at this link: https://www.fidelsoftech.com/ board-of-director/ . The
constitution of the Board Committees is given elsewhere in this report.
The following changes have been made to the Board of Directors of the Company during
the year:
Mrs. Prachi Kulkarni (DIN 03618459) was appointed as the Managing Director of the
Company for a period of 5 years with effect from April 15, 2022. Dr. Girish Desai
(08328701), Dr. Apurva Joshi (06608172) and Mr. Pradeep Dharane (02313403) were appointed
as Independent Directors of the Company with effect from April 15, 2022. The profiles of
the Board of Directors are available on the website of the Company at https://www.fidelsoftech.com/board-of-director/
Mr. Shyamak Kulkarni (DIN 09552445) is liable for retirement by rotation and, being
eligible, offers himself for re-appointment at the ensuing Annual General Meeting (AGM).
On the basis of representations received from the Directors, none of the Directors of
the Company are disqualified as per Sec. 164(2) of the Companies Act, 2013 and rules made
thereunder or any other provisions of the Companies Act, 2013. The Directors have also
made necessary disclosures as required under provisions of Sec. 184(1) of the Companies
Act, 2013. All members of the Board of Directors and senior management personnel affirmed
compliance with the Companys Code of Conduct policy for the financial year 2022-23.
All Independent Directors of the Company have given a declaration under Sec.149(7) of
the Act, that they meet the criteria laid down in Sec. 149(6) of the Act. The Board is of
the opinion that all the Independent Directors of the Company possess the requisite
qualifications, experience, expertise including proficiency in their respective fields of
study.
Further, their names are included in the data bank of Independent Directors maintained
with the Indian Institute of Corporate Affairs in terms of Sec.150 of the Act read with
Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014 .
In compliance with Schedule IV of the Companies Act, 2013 a meeting of the Independent
Directors of the Company was held during the year.
The evaluation process for the Board of Directors pertaining to the Financial Year
2022-23 has been carried out and the same was shared with the Chairman of the Company and
Nomination and Remuneration Committee of the Board.
Mr. Mandar Inamdar was appointed as Chief Financial Officer of the Company with effect
from April 15, 2022. Mr. Pragnesh Patel (ACS 68465) was appointed as Company Secretary and
Compliance Officer on April 15, 2022. He resigned on October 31, 2022, and Mrs. Neha Amod
Joshi (ACS 24974) was appointed as Company Secretary and Compliance Officer with effect
from November 2, 2022.
VIII. Meeting of Board of Directors
A total of 11 Board Meetings were held during the financial year ended 31st
March 2023. The maximum gap between any two Board Meetings was less than 120 days.
Dates of Board Meeting:
| Sr. No |
Meeting dates |
Sr. No |
Meeting dates |
| 1 |
April 4, 2022; |
2 |
April 11, 2022 |
| 3 |
April 15, 2022 |
4 |
April 22, 2022 |
| 5 |
April 26, 2022 |
6 |
May 23, 2022 |
| 7 |
June 7, 2022 |
8 |
June 8, 2022 |
| 9 |
August 3, 2022 |
10 |
November 2, 2022 |
| 11 |
January 31, 2023 |
|
|
IX. Committees of the Board
Audit Committee
Your Directors have constituted the Audit committee in accordance with Sec. 177 of the
Companies Act, 2013 read with Rule 6 of Companies (Meetings of Board and its Powers)
Rules, 2014 on April 15, 2022.
Three (3) meetings of the Committee were held during the period ended 31st
March, 2023 on August 3, 2022; November 2, 2022 and January 31, 2023, detailed as under:
| Names of Members |
No of meetings attended |
| Dr. Apurva Joshi (C) |
3 |
| Mrs. Prachi Kulkarni |
3 |
| Dr. Girish Desai |
3 |
Further, there were no such instances where the recommendation of the Audit Committee
were not accepted by the Board during the financial year under review.
Nomination and Remuneration Committee
Your directors have constituted a Nomination and Remuneration Committee as required
under the provisions of Sec. 178 of the Companies Act, 2013.
Two (2) meetings of the Committee were held during the period ended 31st
March, 2023 on April 15, 2023 and November 2, 2022, detailed as under:
| Names of Members |
No of meetings attended |
| Dr. Girish Desai (C) |
2 |
| Dr. Apurva Joshi |
2 |
| Mr. Pradeep Dharane |
1 |
Policy on Nomination and Remuneration for the Board and Senior Officials is available
on the website of the Company at https:// www.fidelsoftech.com/corporate-policies/
Stakeholders Relationship Committee
Your Board has constituted Stakeholders Relationship Committee under the provisions of
Sec. 178(5) of Companies Act, 2013 on April 15, 2022.
Meeting of the Committee was held during the period ended 31st March, 2023
on March 17, 2023 detailed as under:
| Names of Members |
No of meetings attended |
| Mr. Pradeep Dharane (C) |
1 |
| Mrs. Prachi Kulkarni |
1 |
| Dr. Apurva Joshi |
1 |
This Committee is primarily responsible to review all matters connected with the
Companys transfer/ transmission of securities and redressal of shareholders / investors
/ security holders complaints.
X. Details of Subsidiaries, Joint Ventures or Associate Companies
The Company neither has any Subsidiary, Joint Venture nor Associate Company.
XI. Internal Financial Control & Risk Management
The Company has in place adequate internal financial control commensurate with its size
and operations. During the year, no reportable material weakness was noticed.
The Company has an annual Internal Audit plan in place specifying the scope of the
work, independence, and responsibility of the Internal Auditors. The periodic Internal
Audit reports are reported to the Audit Committee along with Management response.
The Company has developed and implemented a risk management framework which identifies
major risks which may threaten the existence of the Company. A risk mitigation process and
measures have been also formulated.
XII. Directors Responsibility Statement
Pursuant to Section 134(3) (c) of the Companies Act, 2013 the Board of Directors of the
Company to the best of its knowledge and ability confirm that:-
1. In the preparation of the annual accounts, the applicable accounting standards had
been followed along with proper explanation relating to material departures, if any;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 as at March 31,2023 and of the profit of the Company for
that period.
2. 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.
3. they have prepared the annual accounts on a going concern basis.
4. they have laid down internal financial controls to be followed by the Company and
such internal financial controls are adequate and operating effectively.
5. they have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems are adequate and operating effectively.
XIII. Whistle Blower Mechanism
The Company has in place a Whistle Blower Policy establishing a vigil mechanism, to
provide a formal mechanism to the Directors, employees and others to report their concerns
about unethical behavior, actual or suspected fraud or violation of the Companys Code of
Conduct or ethics policy. The Policy provides for adequate safeguards against
victimization of employees who avail such mechanism and also provide for direct access to
the Chairman of the Audit Committee. Whistle Blower policy is available on the website of
the Company at this link https://www.fidelsoftech.com/corporate-policies/
There were no complaints received under this mechanism during the financial year under
review.
XIV. Disclosure required under Sec. 134(3) (e)
The Board has adopted a Board Diversity Policy which sets the criterion for appointment
as well as continuance of Directors, at the time of re-appointment of director in the
Company. As per the policy, the Board has an optimum combination of members with an
appropriate balance of skill, experience, background, gender and other qualities of
directors required for the effective functioning of the Board.
The Nomination & Remuneration committee recommends remuneration of the Directors,
subject to overall limits set under the Act, as outlined in the Remuneration Policy. The
Nomination and Remuneration Policy is available on the website of the Company at https://www.fidelsoftech.com/corporate-policies/
XV. Auditors
The Statutory Auditors, M/s. Kirtane & Pandit, Chartered Accountants, Firm
Registration No. 105215W/W100057, were appointed to hold office for five years from April
1, 2021. During the year under review, there were no qualifications, adverse remarks or
disclaimers made by the Statutory Auditors on the Financial Statements of the Company. The
Unmodified opinion of Auditors on the Financial Statement of the Company for Financial
Year 2022-23 is enclosed along with this report. There were no cases of fraud detected and
reported by the Auditor under Sec. 143(12) during the financial year.
M/s Dakhawe Apte & Associates (Firm Reg no. P2022MH090400) Practicing Company
Secretaries were appointed as Secretarial Auditors of the Company as per Sec. 204 of the
Act, for the financial year 2022-23. They have been re-appointed as Secretarial Auditors
of the Company for the financial year 2023-24.
M/s Milind Sangoram and Co. Chartered Accountants have been re-appointed as Internal
Auditors of the Company for the Financial Year 2023-24.
XVI. Loans and Investment
Details of Loans, Guarantees and Investments covered under the provisions of Sec. 186
of the Companies Act, 2013 are given in the notes to the Financial Statements. There were
no new Loans or Guarantees of Investments made by the Company in the current Financial
Year.
The details of all loans, guarantees and Investment are available in the Register
maintained under Sec. 186 of the Act, which is available for inspection during business
hours on all working days (except Saturday and Sunday).
XVII. Related Party Transactions (RPT)
All related party transactions (RPT) that were entered into during the financial year
ended 31st March 2023 were at an arms length basis and were in the ordinary
course of business. Therefore, the provisions of Sec. 188 of the Act were not applicable.
In compliance with the provisions of the Act, each transaction as entered by the
Company with its related parties is placed before the Audit Committee. A prior omnibus
approval of the Audit Committee is obtained on a yearly basis for the transactions which
are foreseen and repetitive in nature. The transactions pursuant to the omnibus approval
so granted, is audited and a detailed quarterly statement of all such RPTs is placed
before the Audit Committee for its review.
Also, there were no materially significant related party transactions during the year
under review made by the Company with Promoters, Directors, or other Designated Persons.
Thus, disclosure in Form AOC-2 is not required. However, the disclosure of transactions
with related parties for the year, as per Accounting Standard-18 Related Party Disclosures
is given in Note no 30 to the Financial Statements as on 31st March 2023.
XVIII. Secretarial Standards
The Company generally complies with all applicable secretarial standards, issued by the
Council of the Institute of Company Secretaries of India and made applicable as per Sec.
118(10) of the Act.
XIX. Technology Absorption and Conservation of Energy
Details of Technology Absorption are given elsewhere in the report. We recognize the
urgent need to address environmental challenges, and we have implemented several
initiatives to reduce our ecological footprint.
XX. Foreign Exchange Earnings and Outgo
The Company had a total foreign exchange earnings and outgo as provided below during
the year ended 31st March, 2023:
Amount in
| Foreign Exchange Earnings |
30,89,83,684 |
| Foreign Exchange Outgo |
4,70,35,245 |
XXI. Corporate Social Responsibility initiatives.
Your company has always believed in giving back to society in a meaningful way. The
Company has formulated a Corporate Social Responsibility Policy. The Corporate Social
Responsibility Committee of the Board is in charge of formulating, implementing,
monitoring and reviewing the impact of the Corporate Social Responsibility (CSR)
initiatives of the Company.
A detailed report on the Corporate Social Responsibility is enclosed as an Annexure to
this report.
Your Company firmly believes in the importance of Corporate Social Responsibility (CSR)
and strives to make a positive impact on society and the environment. We believe in
empowering communities and making a meaningful difference in peoples lives. We have
partnered with local educational institutions and organizations to provide educational
opportunities and skill development programs for underprivileged communities. By focusing
on education, we aim to empower individuals and enhance their employability.
We supported early-stage startups by making a Contribution to Incubation centers and
support the "Make in India" philosophy.
XXII. Human Resources
We are committed to fostering a diverse and inclusive work environment. We promote
equal opportunities, respect for all individuals. Our diversity and inclusion initiatives
aim to create a workplace that celebrates differences and ensures fairness and equality.
Factors such as a pleasant and safe working environment, fair wages, and opportunities
for growth and development contributed healthy attrition rate. The details of various
Human Resource initiatives are provided elsewhere in the report.
XXIII. Disclosure under the "Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013.
Your Company has complied with the provisions relating to constitution of Internal
Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013. (POSH Act). During the year under review, there were
no cases filed pursuant to this Act. Ms. Aditi Kane is the External Member of the Internal
Complaints Committee. Training was conducted to raise awareness for rights and
obligations, code of conduct under POSH Act.
The Internal Committee is committed to ensure that all the provisions and best
practices under the POSH Act are implemented in law and spirit.
| 1. No. of complaints received in the year |
Nil |
| 2. No of complaints disposed off in the year |
Nil |
| 3. Cases pending for more than 90 days |
NA |
| 4. No of workshops and awareness programs conducted in the year |
1 |
| 5 Nature of action by employer or District officer, if any |
NA |
XXIV. Other Disclosures:
1. Disclosures as required under Sec. 197(12) of the Act read with the applicable rules
of the Companies (Appointment and Remuneration of Personnel) Rules, 2014 are given as
Annexure to this Report.
2. Cash Flow Statement for the financial year ended March 31, 2023, is attached to the
Financial Statements.
3. No material changes and commitments affecting the financial position of the Company
occurred between the end of the financial year to which this financial statement relates
and the date of this report.
4. No significant and material order has been passed by the regulators, courts,
tribunals impacting the going concern status and Companys operations in future.
5. There is nothing report under the Insolvency and Bankruptcy Code, 2016 this for the
financial year ended March 31, 2023.
6. Nil Disclosures: Your Directors state that no disclosure or reporting is required in
respect of the following items as there were no transactions on these items during the
year under review:
I. The Company has not accepted any deposits during the year under review.
II. The Company is not required to maintain Cost Accounting records as per Rule
8(5)(ix)(d) of the Companies (Accounts) Rules, 2014.
III. There were no shares Issued (including sweat equity shares) to employees of the
Company under any scheme.
IV. The Company has no subsidiary and neither the Managing Director nor the Whole-time
Directors of the Company receive any remuneration or commission from any of its
subsidiaries.
V. There was no instance of a difference between amount of the valuation done at the
time of one-time settlement and the valuation done while taking loan form the Banks or
Financial Institutions.
Acknowledgments
As we move forward, we remain committed to transparency, accountability, and delivering
sustainable returns on investments of our shareholders. Your feedback and insights
continue to shape our strategies and guide our decision-making processes. We value your
perspectives and will always strive to uphold the highest standards of corporate
governance.
The Directors express their gratitude to the employees and partners for their
dedication and contribution to the companys success. We also extend our appreciation to
our valued customers, suppliers, and shareholders for their continued support and trust.
We are excited about the future and the opportunities it holds. Together, we will
continue to build a brighter and more prosperous future.
For and behalf of Board of Directors Of Fidel Softech Limited
(Formerly known as Fidel Softech Private Limited)
Sunil Kulkarni
Chairman & Executive Director
DIN :00752937
Date: May 18, 2023
Pune India
+91-9892691696
