husys consulting ltd share price Directors report

To,

The Shareholders,

Husys Consulting Limited.

Your Directors delightfully present the 15th Annual Report on the business and operation of the Company together with the Audited Financial Accounts for the year ended 31st March, 2020.

1. Financial Highlights :

Financial results of your Company for the year ended 31st March 2020 are summarised below:

(Amount in Lacs)

Particulars	2019-20	2018-19
Income from Operations	4,969.25	3,282.99
Other Income	61.58	25.21
Total	5,030.83	3,308.20
Operating expenditure	4,666.29	3,062.53
Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)	364.54	245.67
Finance costs	2.80	3.92
Depreciation and amortization expense	106.49	31.03
Profit before exceptional item and Tax	255.25	210.71
Exceptional Item	-	-
Profit before Tax (PBT)	255.25	210.71
Tax expense	63.54	58.06
Profit for the year (PAT)	191.70	152.65
Proposed Dividend	-	22.81
Dividend Distribution Tax	-	4.66

2. Future Outlook

The Turning Point : A promising outlook for the Indian HR industry with Technology Innovation & Adaptation. It is time of transformation of HR industry in India as disruptive changes from the supply and the demand side are changing the nature of services. The HR industry in India can potentially leapfrog into a ground breaking innovation market as the country has access to advanced technology skills.

Technology be way of Life for HR professionals in future, hence giving an opportunity for increased business in this segment in future.

HR BUYERS - Walking the path to maturity OPPORTUNITIES

* Broad spectrum of available services

* Richer high value-added services expected in the future

* Large opportunity in L&D technology to scale-up skilling programs for Governments & Public programs

RECRUITMENT - Working towards incremental growth & sustainability OPPORTUNITIES

* Sizeable growth opportunities in staffing

* Specialized talent search in STEM, Pharma, and IT

* Recruitment process outsourcing (RPO)

* Managed solutions

LEARNING & DEVELOPMENT - From grassroots to global leadership OPPORTUNITIES

* Government and academic partnerships

* Asia-pacific market

* New technology space, particularly in social media and consumer technologies

OUTSOURCING AND NICHE SERVICES - Global playing field, local advantage OPPORTUNITIES

* Players in India will continue to leverage the labour arbitrage advantage

* Emergence of large homegrown players

* Large opportunities in the SME sector

HR CONSULTING - Exploring new frontiers of value delivery OPPORTUNITIES

* PSUs and homegrown companies

* SMEs and Indian multinationals

* Consolidation in the market

* Analytics and people-based services

HR TECHNOLOGY - Building the base for future growth OPPORTUNITIES

* Sectoral opportunities in retail, hospitality, retail and PSUs

* Emergence of disruptive technologies, such as gamification

* Larger HR technology budgets from the demand side

* Cloud-based and analytics services

While the present scenario looks positive, future innovations in HR technology will depend on the investments that industry is willing to make. In the coming years, as organizations evolve and become increasingly complex, HR technology will be a necessity rather than a choice.

3. State of Companys Financial Affair

The total income of the Company for the year ended 31st March 2020 was Rs. 4,969.25 Lacs as against the total income of Rs. 3,282.99 Lacs for the previous year ended 31st March 2019.

The Company has earned a Net Profit after Tax of Rs. 191.70 Lacs for the year under review as compared to Net Profit of Rs. 152.65 Lacs in the previous year.

4. Nature of Business

Your Company was incorporated as "Husys Consulting Private Limited" under the Companies Act, 1956 vide Certificate of Incorporation dated August 24, 2005 issued by the Registrar of Companies, Andhra Pradesh & Telangana, Hyderabad, India. Further, After Conversion to Limited and listing on Institutional Trading Platform and further the Company has migrated to the EMERGE (SME) Platform of National Stock Exchange on 27th September, 2016.The Corporate Identification Number (CIN) of our Company is L74140TG2005PLC047222.

Husys is in the business of creating and capturing opportunities of People in SME businesses in India and across the Globe. Our aim is to be a one-stop solution provider for People Business across the globe. We are a very young organization with 28 years of average age with more than 300 years of collective experience. We have been serving more than 15 different Industries with an ability to bring Cross-Industry, best practices for business success.

Our Vision

"Enabling People"

Our Mission

We enable Organizations to transform lives by providing effective solutions to manage people.

Our Values

• Integrity: Commitment: Service: Enterprising

HR Consulting

Designed for mid-level and large organisations who are going through leadership change, acquisition, change in business environment or regulatory changes. Outplacement service is the 2nd largest revenue generator for the business

• HR Advisory

• Outplacements

HR Advisory

Husys acts as HR advisor to various organization with components of transition and interim management options. Some of the key advisory / consulting services provided include:

• HR Audit

• Employee Engagement services

• HR Policy definition & implementation

• Specific need-based consulting assignments . Compensation Survey

. Productivity Improvement

Training and Assessment Services

Husys has created the MissionHR Certification Program to help graduates gain insight into the real world of HR. It offers short term and long-term courses for expertise of HR Practices.

MissionHR has been designed with the help of industry experts and been rated the best and only On-The-Job program for HR in India, with on-the-job training at Husys client locations.

Outplacement

Outplacement is the support service provided by organizations to support individuals who are exiting the business (voluntarily or involuntarily) - to help former employees transition to new jobs and help them re-orient themselves in the job market.

Outplacement services are offered in association with their partner-Career Star Group-one of the largest global HR companies

Benefits of this Service

Terminated employees find work faster

During unemployment, terminated employees can receive benefits including pay checks and other benefits stipulated in a severance package. When they find a new position, the severance package is no longer needed and costs decrease.

Increases loyalty & satisfaction with employees

Layoffs are scary to witness as an employee who still works at the company. Working for a company that truly cares for their employees ensures hard working and loyal employees.

Maintains companys image

Social media, television, and live streaming has increased consumer awareness. The outplacement services preserve brand image as the company can show the process of handling terminated employees.

Reduces lawsuit claims

Some disgruntled employees find reasons to present a lawsuit for unlawful termination but with an outplacement service, the risk is reduced.

HR Operations

This service focuses on operational excellence and delivery capability in terms of the day-to-day transactions of the business.

• HR Function Management Solution

• Exclusive Search . Talent Acquisition

. HR Shared Services

HR Functions Management

This is the Companys flagship and primary service that has been built over a 18-year period in India. These services assists organization to free itself from HR related services and focus on the core business. Husys is a leader in building HR departments and management for SMEs.

The services include recruitment, orientation, employee engagement, training and development and maintaining good working conditions.

Exclusive Search

Husys offers talent acquisition services. Recruitment mandates are usually exclusive. The services include recruitment assignments, talent reservoir, project-based requirement and bid based long term contracts for association.

HR Technology

ApHusys: Automating HR Function for corporates with its various modules : Payroll Engine, HRIS Essential, HRIS Sustain and E-commerce Engine, offered in the form of:

• Cloud-based HRIS

• Managed services HRIS

ApHusys is an integrated cloud based HRIS. This helps organizations maintain employee records right from joining the organization to leaving the organization in an efficient and cost-effective manner. ApHusys is available on a simple pay-per-use subscription model and is suitable for midsized to large organizations. It can be accessed from internet browsers and mobile apps and is built with open source tools such as:

• Framework: Odoo

• Database: Postgresql

• Code: Python

• Middle layer: XML, Java script, CSS

• Front end: HTML

Global PEO

Clients seeking business expansion into India need a local partner who understands local employment laws and can help mitigate legal & regulatory risk.

Husys addresses this need by providing HR outsourcing services to client companies through the use of a co-employment relationship helping clients Own the Source at a fraction of the cost

Benefits of this Service Cost

• Avg set up fee for a foreign entity is USD 15-20k

• Avg ongoing maintenance is USD 200k

• 5x more cost-effective than setting up and maintaining new foreign entity Time to Market

• On average, it takes 3-4 months to establish an entity and begin operations in-country

• Begin operations in-country in as little as 48 hours

Maintaining Compliance

• The company is responsible for staying compliant with the ever-changing regulation

• Husys team ensures compliance with local regulations for the global workforce

HR++: Uses machine learning and artificial intelligence to perform HR Services. Husys will launch the HR++ solution in 2020.

HR ++: backed by intelligent system using machine learning & artificial intelligence

• HR++ is a cloud-based software that helps organizations carry out their day to day HR related tasks in an efficient manner. HR++ will utilize insights, trends and intelligence gathered by Husys over its nearly 20-year history

• All the aspects of employee management, payroll management, taxation, recruitment & exit, training management, performance management etc. would be backed by an intelligent system using Machine Learning and Artificial Intelligence.

• The intelligent data capturing would help organizations with data points to make concrete decisions. For ex. identifying training programs that an employee needs based on his current work profile or attrition trends etc.

• Trend analytics and the MIS ( Management Information System ) reports thus generated can help you see clearly about what is working in your favour and what is not. This has a very significant and quantifiable impact on areas like headcount, attrition, manpower planning, etc.

HR++ Uses

• With data analytics, potential actions can be taken by organizations that are in line with the strategic focus of the company

• Hire the best talent with the right skill set.

• Easy performance management to recognize good work.

• Helps employees do career planning and thus build managerial potential in the organization.

• Data Intelligence helps organizations make informed decisions. Ex. succession planning, changing roles of employees based on current skill set etc.

• Relevant stakeholders can view the employees growth graph right from day one and understand the progress to chart out the best career path for the employee.

• Employee satisfaction can be gauged, as this is a major factor hat decides the motivation level of employees

• Reports can be customized to carry out daily tracking.

• Trend analytics can help you see clearly about what is working in your favour and what is not. This has a very significant and quantifiable impact on areas like headcount, attrition, manpower planning, etc. Seamless process from on boarding to exit of the employeesOrganizations can focus on offering relevant training programs/ better insurance policies to employees etc. through this intelligent system.

• By analysing the reasons of attrition from the employee engagement data, companies can take timely actions to reduce it.

• The image of a well-managed organization is looked at by employees in a good light and this would be a win-win situation for all.

Benefits of this Service Cost

• Large teams are recruited for performing HR activities which can be automated

• 30% more cost-effective than manually performing the task

• Makes system availability 24x7 regardless of employee location

HR Efficiency

• HR teams spend a majority of their time doing tasks that can be automated - payroll, joining formalities, etc.

• Reduces workload and streamlines processing

• Leaves HR with more time for employee engagement

Economies of Scale

• Medium sized enterprises have low bargaining power when dealing with service providers (insurance, etc.)

• Higher bargaining power ensures at least 50% cost reduction in specific commerce activities

Solutions are tailormade for SMEs, they help reduce cost & create greater efficiency within the HR Systems

Consulting & technology helps clients reduce costs

The integration of technology into HR processes, outsourcing HR activities to subject matter experts, and leveraging aggregated economies of scale results in significant cost efficiencies for clients globally.

SMEs can focus on their core services

By outsourcing the HR management responsibilities, SMEs can focus on their core business activity.

Global Outreach

: SMEs globally can access Husys technology platform which enables them to offer benefits which are in line with large Fortune 500 companies. The team at Husys is also capable of managing lawsuits and compliances in various country.

High Level of Expertise

Husys has more than 17 years of experience in handling various HR services. The Company has worked with a large number of domestic and global SMEs.

Accuracy

-Automation of HR system improves accuracy to HR operations. It reduces the manpower reguired for handling the HR processes, saves the time of HR dept, increases the productivity, and most importantly, high standards are maintained.

Reduce Risk of Expanding into New Markets

For the PEO services, international clients can start business operations in India without the worry of building a complete _k new legal entity in India

The collaborative approach enable a non-linear growth, expand network & helps gain complementary skills

Husys has partnered with Career Star Group for its

outplacement assignments. Career Start Group is a global transition and outplacement provider. It is spread over 1000 locations in more than 79 countries across the j globe, with excellent understanding of local job market and the ability to provide the very best solutions

Husys has partnered with NAPEO for its PEO

assignments. Companies across the globe support Husys ; in business development for AMS/PEO Services. Husys

; has partnered with more than 12 companies. List of companies include Shield Geo Services Ltd, Australia, Sendbird INC, North Korea, Trippiness Limited, Accern ; Corporation,USA, Procorre Consulting SA, Switzerland, etc.

Husys has a number of local partners for business development and project execution. Husys spends considerable about of time and resources in training its franchise partners who go on to face the client and execute projects. The franchisee partners are spread across more than 15 cities in India. In addition, Husys will onboard resellers for its cloud applications.

Husys has partnered with national MSMEassociations, CA firms, payroll companies, in addition to franchises for sourcing new projects. In addition, it has partnered with MacroStrategy Management Consultancies, Dubai for building its clientbase in MiddleEast and Africa.

Firsts @ Husys:

• First & Only Fully Integrated HR Function Management/Outsourcing Organization in India.

• First HR Function Outsourcing Company Rated by CRISIL

• First to Introduce "Pooled HR Management" & "Startup HR Solutions"

• First to introduce MissionHR (only On-the-Job HR Function Management program) in India.

• First Partner based Business Associates Model for an HR Function Management Company in India.

• One of the First Cloud based HRIS application launched (ApHusys: Application for Human Synergies) in India.

• First HR Company listed on National Stock Exchange under EMERGE Institutional Trading Platform (ITP) for SME segment.

• First HR Company listed on National Stock Exchange under EMERGE, THE SME Growth Platform for SME Segment.

• First HR Company to provide Affinity Services in India

THE IMPORTANCE OF THE SEGMENT

Companies will not survive if the marketing strategy is dependent upon targeting an entire mass market. The importance of market segmentation is that it allows a business to precisely reach a consumer with specific needs and wants. In the long run, this benefits the Company because they are able to use their corporate resources more effectively and make better strategic marketing decisions.

Organizations create a set of segments to project their products focusing on a specific niche market. This niche market defines the product features aimed at satisfying specific market needs including the price, quality & demographic factors. Organizations use segmentation as a tool to make optimum utilization of their finite resources.

Market Segmentation and subsequent Product Differentiation Strategy by an organization is concentrating all marketing efforts on a small but specific and well-defined segment of the population. This is done through identifying needs,wants and requirements that are being addressed poorly or not at all by other firms, and developing and delivering goods or services to satisfy them. As a strategy, Market Segmentation is aimed at being a big fish in a small pond instead of being a small fish in a big pond.

In essence, objectives of segmentation analysis are:

• To reduce risk in deciding where, when, how, and to whom a service, or brand will be marketed

• To increase marketing efficiency by directing effort specifically toward the designated segment in a manner

• consistent with that segments characteristics While it is relatively easy to identify segments of consumers, most Company do not have the capabilities or the need to effectively market their services to all of the segments that can be identified. A Company selects its target market because it exhibits the strongest affinity to a particular services or brand. It is in essence the most likely to buy the service.

5. Change in the nature of business

During the year the Company has not changed its business.

6. Dividend

The Board has not recommended Dividend for the year on the paid-up Equity share capital of the company.

7. Reserves

The Board of the Company has decided to carry Rs. 191.70 Lacs to the Reserves of the Company.

8. Finance

Cash and cash equivalents as at March 31, 2020 were Rs. 88.15 Lacs The Company continues to focus on judicious management of its working capital, receivables, and inventories. Other working capital parameters were kept under strict check through continuous monitoring.

9. Share Capital

The Authorized share capital of the Company is Rs. 50,000,000/-(Equity Shares of 5,000,000). Further, the Paid-up Capital of the Company is Rs. 22,812,500/- (Equity Shares of 2,281,250).

10. Meetings

During the year Four Board Meetings were convened and held and the intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. The dates on which the Board Meetings were held are 21st May 2019, 12th September 2019, 13th November 2019 and 12th February 2020. The gap between no two Board meetings exceeded one hundred and twenty days.

11. Details of Directors or Key Managerial Personnel Appointed or Resigned During the Year Retirement by Rotation

In accordance with the provisions of the Companies Act, 2013, Ms. Gundlapally Praveena, Whole Time Director and Mr. Gundlapally Ramalinga Reddy, Managing Director retire by rotation at the forthcoming Annual General Meeting and being eligible, offered themselves for reappointment.

Appointment

The Board has appointed Mr. Naresh Babu Deevi Appointed as an Executive Director of the Company w.e.f. 1st June, 2019 subject to the approval of shareholders in the ensuing Annual General Meeting. Mr. Viswanathan NS Appointed as an Independent Director of the Company w.e.f 19th June, 2019 (Circular Resolution)

Resignation

Mr. Atal Malviya Resigned as an Independent Director w.e.f. 21st May, 2019 and the Board took note of it in the Circular Resolution passed dated 19th June, 2019.

12. Details of Remuneration to Directors

The information relating to remuneration of Directors and details of the ratio of the remuneration of each Director to the median employees remuneration and other details as required pursuant to section 197(12) of the Act read along with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

13. Declaration by Independent Directors

The Independent Director(s) have submitted the declaration of independence pursuant to section 149(7) of the Act stating that he/they meet the criteria of independence as provided in sub-section (6) of Section 149 of the Companies Act, 2013.

14. Annual Evaluation of the Board

Pursuant to the provisions of the Act and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out an annual evaluation of its performance, the Directors individually as well as the evaluation of the working of its Audit and Nomination & Remuneration Committees.

The following are some of the broad issues that are considered in performance evaluation:

Criteria for evaluation of Board and its Committees

• Setting up of performance objectives and performance against them

• Boards contribution to the growth of the Company

• Whether composition of the Board and its Committees is appropriate with the right mix of knowledge and skills sufficient to maximize performance in the light of future strategy

• Boards ability to respond to crisis

• Board communication with the management team

• Flow of quality information to the Board

Criteria for evaluation of Independent Directors

• Demonstrates willingness to devote time and effort to understand the Company and its business

• Demonstrates knowledge of the sector in which the Company operates

• Quality and value of their contributions at board meetings

• Contribution to development of strategy and risk management policy

• Effective and proactive follow up on their areas of concern

Criteria for evaluation of Non-Independent Directors

• Knowledge of industry issues and exhibition of diligence in leading the organization

• Level of attendance at the Board and Committee meetings where he/she is a member

• Effectiveness in working with the Board of Directors to achieve the desired results

• Providing direction and support to the Board regarding its fiduciary obligations and governance role

• Providing well-balanced information and clear recommendations to the Board as it establishes new policies

15. Audit Committee

The Board has constituted Audit Committee as required under Companies Act, 2013. The Composition of the Committee is as under:

Name of the Member	Designation
Mr. Viswanathan NS (Appointed w.e.f. 19-06-2019]	Chairman
Ms. Nina Elizabeth Woodard	Member
Mr. Biju Varkkey	Member
Mr. Attal Malviya (Resigned w.e.f. 21-05-2019)	Member

The role of the Audit Committee shall include the following:

1. Oversight of our Companys financial reporting process and the disclosure of its financial information to ensure that the financial statements are correct, sufficient and credible;

2. Recommending to the Board, the appointment, re-appointment and, if required, the replacement or removal of the statutory auditor and the fixation of audit fees;

3. Approval of payment to statutory auditors for any other services rendered by the statutory auditors;

4. Reviewing, with the management, the annual financial statements and auditors report thereon before submission to our Board for approval, with particular reference to:

(a) Matters required to be included in the Directors Responsibility Statement to be included in our Boards report in terms of clause (c) of sub-section 3 of section 134 of the Companies Act;

(b) Changes, if any, in accounting policies and practices and reasons for the same;

(c) Major accounting entries involving estimates based on the exercise of judgment by management;

(d) Significant adjustments made in the financial statements arising out of audit findings;

(e) Compliance with listing and other legal requirements relating to financial statements.

(f) Disclosure of any related party transactions; and

(g) Qualifications in the draft audit report.

5. Reviewing, with the management, the quarterly financial statements before submission to our Board for approval;

6. Reviewing with the management, the statement of uses/application of funds raised through an issue (public issue, rights issue, preferential issue etc.), the statement of funds utilized for purposes other than those stated in the offer document/prospectus/ notice and the report submitted by the monitoring agency monitoring the utilization of proceeds of a public or rights issue, and making appropriate recommendations to our Board to take up steps in this matter;

7. Reviewing and monitoring the auditors independence and performance, and effectiveness of audit process;

8. Approval or any subsequent modification of transactions of the listed entity with related parties;

9. Scrutiny of inter-corporate loans and investments;

10. Valuation of undertakings or assets of the listed entity, wherever it is necessary;

11. Evaluation of internal financial controls and risk management systems;

12. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;

13. Reviewing with the management, performance of statutory and internal auditors, and adequacy of the internal control systems;

14. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit.

15. Discussion with internal auditors any significant findings and follow up there on.

16. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board.

17. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern;

18. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors;

19. To review the functioning of the Whistle Blower mechanism, in case the same is existing;

20. Approval of appointment of CFO (i.e., the whole-time Finance Director or any other person heading the finance function or discharging that function) after assessing the qualifications, experience & background, etc., of the candidate.

21. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee.

16. Nomination and Remuneration Committee:

The Board has constituted Nomination and Remuneration Committee as required under Companies Act, 2013. The Composition of the Committee is as under:

Name of the Member	Designation
Mr. Biju Varkkey	Chairman
Ms. Nina Elizabeth Woodard	Member
Mr. Viswanathan NS (Appointed w.e.f. 19-06-2019)	Member
Mr. Gundlapally Ramalinga Reddy	Member
Mr. Attal Malviya (Resigned w.e.f. 21-05-2019)	Member

In terms of the provisions of Section 178(3) of the Companies Act, 2013, the Nomination and Remuneration Committee is responsible for formulating the criteria for determining the qualifications, attributes, and Independence of a Director. The Nomination and Remuneration Committee is also responsible for recommending to the Board a policy relating to the remuneration of the Directors, Key Managerial Personnel and Senior Management.

In line with the requirement, the Board has adopted a Nomination and Remuneration Policy for Directors, Key Managerial Personnel and Senior Management which is as follows.

Objectives of the Policy

The objectives of this policy are as detailed below:

• To formulate the criteria for determining qualifications, competencies, positive attributes and independence for appointment of a Director (Executive / Non-Executive) and recommend to the Board policies relating to the remuneration of the Directors, Key Managerial Personnel and other employees.

• The policy also addresses the following items : Committee member qualifications; Committee member appointment and removal; Committee structure and operations; and Committee reporting to the Board.

• To formulate the criteria for evaluation of performance of all the Directors on the Board;

• To devise a policy on Board diversity; and

• Identifying persons who are qualified to become Directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the board of Directors their appointment and removal.

• Whether to extend or continue the term of appointment of the independent director, on the basis of the report of performance evaluation of independent Directors.

• To lay out remuneration principles for employees linked to their effort, performance and achievement relating to the Companys goals.

Remuneration Policy

The Companys remuneration policy is driven by the success and performance of the individual employees and the Company. Our compensation philosophy is to align Directors and Husys Minds compensation with our business objectives, so that compensation is used as a strategic tool that helps us recruit, motivate and retain highly talented individuals who are committed to our core values. We believe that our compensation programs are integral to achieving our goals. Through its compensation program, the Company endeavours to attract, retain, develop and motivate a high-performance workforce. The Company follows a compensation mix of fixed pay, benefits and performance-based variable pay. Individual performance pay is determined by business performance of the Company. The Company pays remuneration by way of salary, benefits, perquisites and allowances (fixed component) and performance incentives, commission ( variable component ) to its Chairman, Managing Director and other Executive Directors. Annual increments are decided by the Nomination & Remuneration Committee within the salary scale approved by the Board and Shareholders.

17. Stakeholder Relationship Committee

The Board has constituted Stakeholder Relationship Committee as required under Securities Exchange Board of India (Listing obligations and Disclosure Requirements) Regulations, 2015 ("Regulations").

The Composition of the Committee is as under:

Name of the Member	Designation
Ms. Nina Elizabeth Woodard	Chairman
Mr. Biju Varkkey	Member
Mr. Gundlapally Ramalinga Reddy	Member
Mr. Naresh Babu Deevi (Appointed w.e.f. 01-06-2019)	Member
Mr. Viswanathan NS (Appointed w.e.f. 19-06-2019)	Member

Set forth below are the terms of reference of our Stakeholders Relationship Committee.

1. Considering and resolving grievances of shareholders, debenture holders and other security holders;

2. Redressal of grievances of the security holders of our Company, including complaints in respect of transfer of shares, non-receipt of declared dividends, balance sheets of our Company etc.;

3. Allotment of Equity Shares, approval of transfer or transmission of equity shares, debentures or any other securities;

4. Issue of duplicate certificates and new certificates on split/consolidation/renewal, etc.

5. Overseeing requests for dematerialization and dematerialization of shares; and

6. Carrying out any other function contained in the equity listing agreements as and when amended from time to time. Investor Grievance Redressal Policy

The Company has adopted an internal policy for Investor Grievance handling, reporting and solving.

18. Vigil Mechanism

The Company has formulated a Whistle blower policy and has established vigil mechanism for employees including Directors of the Company to report genuine Concerns. The provisions of this Policy are in line with the provisions of the Section 177(9) of the Act.

19. Risk Management Policy

The Company has formulated a Risk Management Policy for dealing with different kinds of risks which it faces in day to day operations of the Company. Risk Management Policy of the Company outlines different kinds of risks and risk mitigating measures to be adopted by the Board. The Company has adequate internal control systems and procedures to combat the risk. The Risk management procedure will be reviewed by the Audit Committee and Board of Directors on time to time basis.

20. Policy on Preservation of the Documents

The Company has formulated a Policy pursuant to Regulation 9 of the Securities Exchange Board of India (Listing obligations and Disclosure Requirements) Regulations, 2015 ("Regulations") on Preservation of the Documents to ensure safe keeping of the records and safeguard the Documents from getting manhandled, while at the same time avoiding superfluous inventory of Documents.

21. Policy on Criteria for Determining Materiality of Events

The Policy is framed in accordance with the requirements of the Regulation 30 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Regulations).

The objective of the Policy is to determine materiality of events or information of the Company and to ensure that such information is adequately disseminated in pursuance with the Regulations and to provide an overall governance framework for such determination of materiality.

22. Obligation of Company under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

In order to prevent Sexual Harassment of Women at Workplace a new act "The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013" has been notified on 9th December, 2013. Under the said Act every Company is required to set up an Internal Complaints Committee to look into complaints relating to sexual harassment at work place of any women employee.

The Company has adopted "Anti-Sexual Harassment Policy" constituted "Redressal Committee" as required under section 4 (1) of Sexual harassment of women at work place (prevention, prohibition and redressal) Act, 2013.

This Committee consists of following members:

• Ms. Saritha Pandurangi

• Ms. Megha Chandak

• Ms. Daksha Chowdhary

During the year under review, no complaint of harassment at the workplace was received by the Committee.

23. Auditors: Statutory Auditors

M/s. JBRK & Co., Chartered Accountants, Hyderabad, Firm Registration Number 005775S, Ratification as Statutory Auditors of the Company to hold office until the conclusion of the upcoming Annual General Meeting. As per the provisions of the Companies Act, 2013.

In this regard the Company has received certificate from the Auditors to the effect that if they are appointed it would be in accordance with the provisions of section 141 of the Companies Act, 2013.

Accordingly, proposal for their re-appointment as Statutory Auditors is being placed before the shareholders for approval at the 15th Annual General Meeting.

Auditors Report

M/s. JBRK & Co., Chartered Accountants, Hyderabad, Firm Registration Number 005775S have issued their Report for the Financial Year ended 31st March 2020.

There is no qualification, reservation, adverse remark or disclaimer by the Statutory Auditors in their report and hence no explanation or comments of the Board is required in this matter.

Disclosure about Cost Audit

The Central Government has not prescribed the maintenance of Cost records under section 148(1) of the Companies Act, 2013, for any of the services rendered by the Company.

Secretarial Audit

A Secretarial Audit Report given by Mr. Subhash Kishan Kandrapu, Practising Company Secretaries is annexed with the report. The report is self-explanatory and do not call for any further comments.

Internal Audit Controls and their adequacy

The Company has a proper and adequate system of internal controls, commensurate with the size scale and complexity of its operations. This ensures that all transactions are authorized, recorded and reported correctly, and assets are safeguarded and protected against loss from unauthorized use or disposition. In addition, there are operational controls and fraud risk controls, covering the entire spectrum of internal financial controls.

To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the audit committee of the Board and to the Chairman and Managing Director.

The internal Audit department monitors and evaluate the efficiency and adequacy of the internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit functions, process owner undertakes corrective actions in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the audit committee of the Board.

Adequacy of internal financial controls with reference to the financial statements

The Company has internal Auditors and the Audit Committee constituted are in place to take care of the same. During the year, the Company continued to implement their suggestions and recommendations to improve the control environment. Their scope of work includes review of processes for safeguarding the assets of the Company, review of operational efficiency, effectiveness of systems and processes, and assessing the internal control strengths in all areas. Internal Auditors findings are discussed with the process owners and suitable corrective actions taken as per the directions of Audit Committee on an ongoing basis to improve efficiency in operations.

24. Details of Subsidiaries Joint Venture or Associates

The Company has no Subsidiaries, Joint Venture or Associates.

25. Group Entities

Below mention are the details of Companies/Entities promoted by the promoters of our Company. No equity shares of our Group Companies are listed on any stock exchange and they have not made any public or rights issue of securities in the preceding three years.

Our Group Entities include:

1. Veena Educational Society

2. Gymin Sports Private Limited

3. Gundlapally Krida Foundation

26. Details of significant and material orders passed by the regulators or courts or tribunals.

There were no such orders passed.

27. Deposits from Public

The Company has not accepted any Deposits within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.

28. Particulars of Loans, Guarantees or Investments Under Section 186

No loans and advances given to the Key Managerial Personnel.

29. Particulars of Contracts or Arrangements with Related Parties:

All transactions entered into with the related parties as defined under the Companies Act, 2013 during the financial year were in the ordinary course of business and on arms length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no materially significant transactions with the related parties during the financial year which were in conflict with the interest of the Company. Suitable disclosure as required by the Accounting Standards (AS 18) has been made in the notes to the Financial Statements and AOC-2 is disclosed as part of Directors report.

Policy on Related Party Transactions

The Company has developed a Related Party Transactions Policy for purpose of identification and monitoring of such transactions. The objective of this Policy is to set out ( a ) the materiality thresholds for related party transactions and; ( b ) the manner of dealing with the transactions between the Company and its related parties based on the Act, Clause 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and any other laws and regulations as may be applicable to the Company.

The policy on related party transactions as approved by the Board is uploaded on the Companys website and can be accessed at https://husvs.com/wp-content/uploads/2017/05/Related_Partv_Transactions_Policv_Husys.pdf

30. Particulars of Employees

There are no employees drawing remuneration in excess of the limits prescribed under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Information as required under the provisions of Rules 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are set out in Directors Report.

31. Material Changes and Commitments

There are no material changes and commitments affecting the financial position of the Company from the financial year ended 31st March, 2020 to the date of signing of the Directors Report.

32. Transfer of Amounts to Investor Education and Protection Fund

Your Company did not have any funds lying unpaid or unclaimed for a period of seven years. Therefore, there were no funds which were required to be transferred to Investor Education and Protection Fund (IEPF).

33. Listing with Stock Exchanges

At present the equity shares of the Company are listed on the Emerge-the SME Growth Platform of National Stock Exchange at Mumbai. The Company confirmed it has paid Annual Listing Fees due to the National Stock Exchange for the year 2020-21.

34. Corporate Governance

Your Company has been practicing the principles of good corporate governance. A detailed report on corporate governance is available in annual report.

35. Insider Trading Regulations

Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations, 1992 read with SEBI ( Prohibition of Insider Trading) Regulations, 2015, as amended from time to time, the code of conduct for prevention of insider trading and the Code for Corporate Disclosures ("Code"), as approved by the Board from time to time, are in force by the Company. The objective of this Code is to protect the interest of shareholders at large, to prevent misuse of any price sensitive information and to prevent any insider trading activity by dealing in shares of the Company by its Directors, designated employees and other employees. The Company also adopts the concept of Trading Window Closure, to prevent its Directors, Officers, designated employees and other employees from trading in the securities of Husys Consulting Limited at the time when there is unpublished price sensitive information.

36. Depository System

As the Members are aware, your Companys shares are trade-able compulsorily in electronic form and your Company has established connectivity with both National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). In view of the numerous advantages offered by the depository system, the members are requested to avail the facility of Dematerialization of the Companys shares on NSDL & CDSL. The ISIN allotted to the Companys Equity shares is INE336T01010.

37. Extract of Annual Return

The Extract of Annual Return is prepared in Form MGT-9 as per the provisions of the Companies Act, 2013 and Rule 12 of Companies (Management and Administration) Rules, 2014 and the same is enclosed in Annual Report.

38. Directors Responsibility Statement

Pursuant to the Provisions of Section 134 of the Companies Act, 2013, the Directors states that:

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

(b) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2019 and Statement of Profit of the Company for that period;

(c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) The Directors have prepared the annual accounts on a going concern basis; and

(e) The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

39. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The particulars as prescribed under Sub Section (3) (m) of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014.

A. Conservation of Energy:

The Companys core activity is Human Resource Management and services related which is not power intensive. The Companyis making every effort to conserve the usage of power

B. Technology Absorption (R&D, Adaptation and Innovation):

1. Efforts, in brief, made towards technology absorption, adaptation and innovation:

(i) Continuous research to upgrade existing products and to develop new products and services.

(ii) To enhance its capability and customer service the Company continues to carry out R & D activities in house.

2. Benefits derived as a result of the above efforts:

(i) Introduction of new and qualitative products.

(iI) Upgrade of existing products.

3. Future plan of action:

Husys will continue to invest in and adopt the best processes and methodologies suited to its line of business and long term strategy. Training employees in the latest appropriate technologies will remain a focus area. The Company will continue to leverage new technologies and also on the expertise available.

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

Particulars	2019-2020	2018-2019
Foreign Exchange Earnings	447,269,547	280,223,148
Foreign Exchange Outgo	3,816,674	547,096

40. Business Responsibility Report

Your Company has always been at the forefront of voluntary disclosures to ensure transparent reporting on all matters related to the Companys governance and business operations, and has voluntarily undertaken to publish the required data to extent applicable and accordingly, the Business Responsibility Report is annexed in the Annual Report. The said report comprehensively covers your Companys philosophy on corporate social responsibility, its sustainability activities pertaining to efforts on conservation of environment, conducting green awareness events, its commitment towards society, enhancing primary education, initiatives and activities taken up as part of this philosophy for the year 2020-21. Business Responsibility Report as required under Regulation 34 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Regulations) is disclosed separately in the current Annual Report.

41. Management Discussion and Analysis Report

Management Discussion and Analysis Report as required under Regulation 34 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Regulations) is disclosed separately in the current Annual Report.

42. Acknowledgments

The Directors would like to thank all the Stakeholders including Financial Institutions, Banks, Government Authorities, Power Utilities, Regulators, Customers, Vendors and Members for their continued support to the Company. Your Directors also wish to place on record their deep sense of appreciation for the excellent services of the employees at all levels and all other associated with the Company.

For and on behalf of the Board of Directors For Husys Consulting Limited

	Sd/-	Sd/
	Gundlapally Ramalinga Reddy	Gundlapally Praveena
	Managing Director	Whole-Time Director
	DIN: 00559079	DIN: 00559136
Date: 29-08-2020
Place: Hyderabad