mps ltd share price Management discussions

Over the past 50 years, MPS has been transforming the way the world learns. This mission was further accelerated in 2012 after a change in majority ownership from Macmillan to ADI in 201112. The new leadership team launched MPS into an era of rapid growth through a transformation of organizational culture by instilling an entrepreneurial mindset, reiterating the importance of customer focus, and driving forward a continuous improvement.

Our acquisitions of US-based Content Development and Design houses during the years 2013-2015 allowed us to expand the scope of our services, which now include end-to-end publishing solutions, from content production to delivery, all delivered on a global scale. From 2015 to 2022, we diversified our business to target new customers, enter adjacent markets, and develop additional business streams.

The first step in the diversification was the establishment of a platform business via the acquisitions of Magplus and THINK. In 2018, the acquisition of TIS (the division was part of one of Indias largest conglomerates for more than twenty-seven years) India, AG, and GmBH marked our definitive entry into the Corporate Learning and Development market. Our success with preceding acquisitions provided us with the conviction to acquire HighWire Press in 2020, during the pandemic, which allowed us to scale our platform business. Expanding our presence in the thriving corporate learning market, we recently achieved a significant milestone by acquiring EI design, a fast-growing provider of transformative learning solutions, and seamlessly integrating it with our pre-existing eLearning business, forming the formidable entity, EI. As a result, platforms and eLearning solutions now form a substantial part of MPS overall business, further solidifying our position as a leading player in the industry. MPS deep domain expertise in content transformation and eLearning is underpinned by a robust technology platform, a team of industry experts, and a comprehensive portfolio of capabilities:

• 50+ years of content experience has resulted in our providing the best-in-class outsourcing solutions.

• Cloud-based highly automated and streamlined workflow processes has resulted in quicker structuring, review, edit, and delivery.

• A multi-functional team of industry experts with strong capabilities and domain expertise ensures stellar outputs.

• Access to proprietary smart tools ensures standardization of services faster and more economically vis-?-vis other customers.

• Ability to cross-sell solutions across a diverse client base allows for multiple touch points, enabling expertise in multiple verticals/service lines.

• Innovative technology solutions clubbed with global sourcing partnerships enables efficient delivery of complex content.

BUSINESS SEGMENT OVERVIEW FOR FY2023

MPS Limited is a leading global provider of content, platforms, and eLearning solutions. Our goal "Make Learning Smarter and Accessible to All" unifies our diverse talent pool of over 2,500+ professionals spread across seven countries. MPS business segments have seen significant upgrades during the past financial year, ranging from deeper digital integration into workflows and offerings to enhanced remote working setups. A summary of MPS business segments, including Overview, Proportion of Total Revenue, Target Market, Key Acquisitions, Business Strategy, and Value Proposition, is provided below:

	Content Solutions	Platform Solutions	eLearning Solutions
Overview	Providing a wide range of content solutions, which involves the creation of the content and its delivery across all media channels, helping us in driving the competitiveness and differentiation of our customers.	Providing a complete range of configurable platform solutions throughout the entire content lifecycle, delivered as SaaS. Known to be the thought leader and trailblazer in the space	Developing and delivering high-impact and comprehensive learning and performance support solutions that provide a high engagement quotient and enhance learners performance.
			All the solutions ensure a high ROI for the learners, business, and the organization.
Proportion of Total Revenue	52%	23%	25%
Key Acquisitions	2013 Elements LLC 2014 EPS 2015 TSI Evolve	2016 Mag+ 2017 THINK 2020 HighWire Press	2018 TIS (the division was part of one of Indias largest conglomerates for more than twenty-seven years) India, Switzerland, and Germany 2022 EI Design
Competitive Strategy	Operational Excellence	Product Leadership	Product leadership
Key Value Proposition	Efficiency and differentiation	Innovation and thought leadership	Experiential and transformative
Market Segments	Research and Education Authoring and Development Manuscript Submission and Peer Review Editorial Services	Research, Education, and Corporate Workflow Management and Tracking Identity and Access Management Hosting and Delivery	Education and Corporates L&D Advisory and Consulting Courseware Development Micro Learning
Key Offerings	Production and Assembly Media Asset Development Digital Transformation Accessibility	Insights and Analytics Subscription Management Fulfillment and Customer Service	Simulations and Serious Games Extended Reality Learning Platforms Experience Centers

CONTENT SOLUTIONS

Overview

• Offers end-to-end content outsourcing solutions to leading education and research players

• Global delivery model combines local content expertise with offshore horsepower to produce high-qualit y deliverables with unparalleled-ciency

• Deep domain expertise powers the development of highly differentiated learning and research products that enable the growth of MPS customers

• Automation and tech-enabled delivery enables faster time to market and competitiveness of MPS customers

• Key acquisitions: Element LLC (2013), EPS (2014), and TSI Evolve (2015)

Areas of Excellence

• The first content outsourcing company in the world with 50+ years of experience providing comprehensive content outsourcing services

• Positioned as the market developer and led several new waves of outsourcing for the industry

• Robust technology-supported production processes backed by a large pool of experienced resources

• Highly regarded management and delivery teams with deep relationships and the ability to handle complex programs

Areas of Upside Opportunity

• Transition from technology-supported to technology-led production and rapid development of automated delivery

• Application of machine learning and advanced analytics to reduce turnaround time and improve cost efficiencies

• Lead consolidation among vendors and vertically aligned services to continue to expand wallet share

• Ripe market for disintermediation and recently established outsourcing programs with leading educational institutions lending support to this positive outlook

PLATFORM SOLUTIONS

Overview

• Revenue model is SaaS, and the majority of the revenue is recurring and license based

• Product portfolio is the most comprehensive in the marketplace, and each product solves a meaningful effi problem in a compelling way

• Market positioning is that of thought leader after the acquisition of HighWire Press, which was the first independent platform company incubated at Stanford University in 1995

• Operating leverage is high, and margins have significant room to grow given the nature of the business

• Key acquisitions: Mag+ (2016), Think Subscription (2017), and HighWire Press (2020)

Areas of Excellence

• The first independent platform company in the world with 25+ years of experience with the most comprehensive product suite in the marketplace

• Advanced technical skills combined with deep domain expertise, which is a unique combination in a market that values rich experience

• Mature and diverse customer base that enables future growth through word-of-mouth

• Large, highly trained offshore workforce that provides the horsepower needed for scale and rapid product development

Areas of Upside Opportunity

• Opportunities still at an early stage of integrating and cross-selling with other lines of business, providing significant upside potential

• New product development and enhancement opportunities identified, which represent a tremendous scale of opportunity

• Entry into adjacent markets including sales enablement, marketing communications, and experiential learning

• Platform business providing a proprietary opportunity for a new wave of complete content operations outsourcing in a single-supplier mode eLEARNING SOLUTIONS

Overview

• Unparalleled solution portfolio, including simulations, games, experience centers, digital learning, assessments, extended reality, and learning technology

• Deep domain expertise across content, creative, learning design, and technology, and as the first eLearning company in the world, established in 1990

• Premium pricing is supported by a higher fidelity of learning deliverables enabled for modern learners

• Diverse customer base, including 200+ Fortune 500 companies across the Americas, EMEA, India, Switzerland, and Germany

• Ability to address varied customer needs with expertise across industries, verticals, solution formats, and topics

• Key acquisitions: TIS (the division was part of one of Indias largest conglomerates for more than t wenty-seven years) India, Switzerland, Germany (2018) & EI Design (2022)

Areas of Excellence

• The first eLearning company in the world with 30+ years of experience that commands a premium pricing model

• Developed 2mn+ hours of cutting-edge content and a reputation for pioneering innovative solutions

• Deeply entrenched relationships with 100+ Fortune 500 clients spread across North America, EU, UK, Middle East, Asia Pacific, and India

• Won 400+ industry awards and featured in Top 20 content development, gamification, and training outsourcing lists

Areas of Upside Opportunity

• Leverage our reputation to continue to win logos and build a diversified and marquee customer base

• Extend automated sales to optimize time-to-facility for customers and provide faster development

• Strategically tap into high-dollar Edtech clients with a differentiated value proposition

• Leverage the advent of new technologies to drive recurring license revenue

• Availability of market consolidation opportunities, and the companys robust inorganic strategy and experience can drive rapid growth

VISION 2027

To create a compelling learning company at a meaningful scale that can help the world learn smarter. We aspire to be the provider of choice in our markets that powers experiential learning experiences with the latest technology innovations.

DEEP PURPOSE

MPSs deep purpose is to make learning smarter and accessible to ALL. The articulation of this deep purpose has helped our teams to discover a tangible link between the MPS stated purpose and what they do on the job. Our leaders pursue our purpose more deeply by navigating the inevitable trade-offs more deliberately and effectively to balance between short- and long-term values.

Our deep purpose serves as a radically new operating system for the organization, enhancing our performance while also delivering meaningful benefits to the society, Through our Corporate Social Responsibility (CSR) Pro-and gram, MPS partners with NGOs and Charitable Trusts to help people who are marginalized. Our CSR initiatives support the learning needs of the communities around our delivery centers. In this way, our employees can take an active interest in these initiatives, feel closer to the community, and drive the needed change. Specifi-cally, we fund programs that provide education for girls and support vocational skills and computer education. We also partner with charitable organizations to build homes for children struggling with mental and physical illnesses, and to provide education to students with learning disabilities.

As a result, MPSians have "come alive" with a sense of purpose in their work, their motivation, energy, and creativity blossoms. Our journey toward high performance has been a result of our deepening connection to enduring and essential human values.

VALUES

Our ambitions are powered by our values, which define who we are today and will shape our future. These are not principles that we will compromise on, but tools upon which we will depend.

Excellence is a way of life for us. It involves respecting our colleagues, owning our responsibilities, and committing our best efforts to our customers. Excellence is not perfection but rather the simplicity in giving our best effort to every interaction, deliverable, and decision.

Empathy implies caring. It means caring to understand things deeply, absorbing the unwritten, and going the extra mile for the people who depend on us. Although empathy is usually intuitive, we believe that it can be developed intellectually through impactful programs.

Efficiency defines who we are. It involves driving automation, smarter workflows, and innovative operating models and not allowing any job to be considered grunt work. We will be doing things very differently by 2023, and will be innovating to make publishing and learning smarter along every step of the journey.

In conclusion, these three values Excellence, Empathy, and Efficiency may seem distinct from one another, but they all act in synchrony to create a synergetic value system that defines the culture at MPS. Each value is important in its own right, but when combined, they create an unstoppable force that drives our organization towards success. By upholding these values, we will continue to innovate, evolve, and adapt to the ever-changing needs of our customers and the industry. We believe that this value system will not only shape our future but also help us achieve our long-term goals as an organization.

CERTIFICATIONS

Our commitment and success are acknowledged by the following certifications:

• ISO 9001:2015: This is an international quality management system for the companys production business.

• ISO/IEC 27001:2013: This strengthens the information security management system and applies to MPS Indian production units.

• PCI-DSS: This global information security standard is awarded by the Payment Card Industry Security Standards Council. This certification (PCI-DSS ver-sion_3.2.1) extends across MPS fulfillment services/ THINK units.

• GDPR Compliant: The General Data Protection Regulation (GDPR) is legislation that updated and unified data privacy laws across the European Union (EU).

• COUNTER 5 Compliant: This is an international initiative involving services by librarians, publishers, and intermediaries. The standards facilitate the consistent and credible recording and reporting of online usage statistics.

FINANCIAL OVERVIEW

Items	FY 2022-23	FY 2021-22	YoY Change
Revenue from operations	50,105	44,888	11.62%
EBITDA	15,676	12,628	24.13%
PAT	10,919	8,712	25.33%
Items	FY 2022-23	FY 2021-22	YoY Change
Revenue from operations	29,801	28,402	4.69%
EBITDA	12,035	10,184	18.17%
PAT	8,628	7,146	20.74%

KEY RATIOS

In accordance with the SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations 2018, the Company is required to provide details of significant changes (i.e., change of 25% or more as compared with the immediately previous financial year) in key financial ratios, along with detailed explanations. The key financial ratios are given below:

Items	FY 2022-23	FY 2021-22	YoY Change
Debtors turnover (no. of days)	64	74	(13.51%)
Current ratio (in times)	3.36	2.71	23.93%
Operating profit margin	27.17%	23.14%	17.41%
Net profit margin	21.79%	19.41%	12.29%
Return on net worth	27.62%	23.29%	18.59%

*Basis: Consolidated Financials

**Explanation for changes is provided in the balance sheet section later in the report.

Items	FY 2022-23	FY 2021-22	YoY Change
Debtors turnover (no. of days)	61	70	(12.86%)
Current ratio (in times)	3.94	2.25	75.07%
Operating profit margin	36.07%	30.70%	17.47%
Net profit margin	28.95%	25.16%	15.07%
Return on net worth	25.45%	20.87%	21.94%

*Basis: Standalone Financials

**Explanation for changes provided in the balance sheet section later in the report.

#Change in current ratio is majorly due to increase in contract assets and reduction in advance from customers.

FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

MPS achieved another year of unprecedented profitability in FY23 with a PBT of INR 147 crores, representing 24.56% growth over the previous year. The momentum from FY22 carried forward, and on a consolidated basis, FX-adjusted revenues for FY23 were recorded at INR 500 crores, against INR 451.21 crores in FY22. EBITDA significantly improved from INR 126.28 crores in FY22 to INR 156.76 crores in FY22. MPS continued to remain debt-free through the year, with surplus funds of INR 193.21 crores on its balance sheet at the close of the year under review. The revenues for FY23 were recorded at INR 501.05 crores, against INR 448.88 crores in FY22.

SEGMENT-WISE PERFORMANCE

The Post-Pandemic momentum in the Content Solutions business continued in FY23. Given the significant operating leverage in this business segment, PBT grew by as much as 34 percent in FY23. The Scholarly lines of business-led growth in Content Solutions in FY23. Some early signs of success in this business segment with the "Going Gestalt" growth strategy include:

• Revised GTM: Market-based approach enabled unlocking growth synergies between scholarly content/platforms and education content/eLearning.

• Cross-Selling/Upselling: Focus on Star Accounts led to robust growth in all the Top 10 Content Solutions customers and double-digit growth in 3 out of the Top 10 accounts.

• New Capabilities: A new Peer Review solution was launched that is proving to be highly successful, with a significant multi-year win in FY23 with a prestigious new customer. MPS invested in new AI/ML based image and research integrity solutions and saw noteworthy demand for these services as well.

In the platform business, the performance in H2 FY23 was the first signal of growth in this business segment in the third year of ownership of HighWire and laid a strong foundation for FY24 and the years ahead. MPS Platform business has now transitioned into a healthy and growing phase for the following reasons:

1. The emphasis of the platform business has now transitioned from Support/Delivery to Product

Development. This includes new Product Launches, Active Product Roadmaps, and Upgrades.

2. A new customer acquisition strategy that involves Product/Service bundling and Price Warriorship is gaining traction and helping us develop a new customer base.

3. Feedback from the industry and the scholarly community is highly encouraging. HighWire and MPS offer the only "serious" independent choice since two of MPS larger competitors have been acquired by publishers.

eLearning is now the second-largest business segment. Revenues were at INR 127 crores in FY23 ~25 percent of Total Revenue. Profitability improved by more than double during By the end of FY23, all four entities were performing, including the Swiss entity, which finally recovered from the decline during the Pandemic. The acquisition of EI Design confirmed the validity of the new acquisition playbook of acquiring growth assets at compelling valuations. In addition to substantial financial indicators, including significant margin improvement, operational indicators were highly positive. MPS is now market-leading in-service delivery and quality in the eLearning practice, reflected in high CSAT scores across the portfolio. Growth operations in the eLearning practice have matured and are setting the benchmark for the other business segments.

INDUSTRY OVERVIEW

Educational publishing: school, higher education, and continuing education Printed curriculum material, consisting of textbooks, workbooks, test papers, and even story books, formed the core of educational publishing until the 21st century. However, the $16 billion industry is undergoing a major transformation with technological disruptions. The traditional business structures are replaced with an increasing focus on online courses and course materials across grades. The educators are also provided with professional development services. Some major disruptive technologies in this space include e-books, video streaming, digital distribution, gaming, and cloud computing.

Rising higher education enrolment is a critical growth factor, which rose by 14% (23.9 million students) by 2020.¹ Pent-up demand in the K-12 education market can enhance state spending on instructional resources, such as textbooks, software, and other instructional media for the 48 million public school students. The focus on print was already existent and is further boosted in the current scenario. The digital educational publishing business is likely to grow by $6.96 billion between 2020 and 2024.²

UPCOMING TRENDS IN THE EDUCATIONAL PUBLISHING INDUSTRY

Authoring a course

With rapid digitization in the industry, almost 58% of publishers are likely to employ course creation tools.³ These tools make learning a lot more interactive by integrating multimedia components into learning materials. The course authoring software is extremely cost-effective and optimizes time and labor.

Interactive study material

To keep up with the transforming landscape, providing interactive books facilitates business growth. The interactive books market is likely to grow at a CAGR of 16.5%, to be worth $2.3 billion by 2027.⁴

Rental e-books

The e-book phenomenon is likely to dominate the rental sector. The market is expected to grow at a CAGR of 22% between 2020 and 2024 and be valued at $295 million by 2024.⁵ The digital transformation is beyond being a byproduct of the pandemic, and thus provides a significant impetus to educational publishers to streamline operations by considering robust digital platforms and henceforth stay relevant.

Academic and Scientific, Technical, and Medical (STM) Publishing

Notwithstanding the challenges, the scholarly publishing sector offers several growth indications. The global market is likely to restore to the pre-pandemic value of $28 billion by 2023.

RESEARCH CONTENT OUTSOURCING

The publishing outsourcing market growth is driven by growth in demand for digital content and print-on-demand solutions. India will continue to remain the largest outsourcing destination due to the availability of necessary IT infrastructure and skilled workforce. Based on the primary and secondary research by EY-Parthenon, the industry is expected to grow at 3-5% per annum in the five years from 2020 to 2025 (Source: EY Parthenon; Global Industry Analysts; Global Market Insights).

The key drivers anticipated for the industry are as follows:

• Vendor consolidation in mature areas of outsourcing to provide further impetus to scaled players

• Customer preference to work with partners who own technology IP that will support efficiency requirements and future proof customer needs

• Drive to automate the new processes and applications of AI/ML to mature processes

eLEARNING

The eLearning market size surpassed $315 billion in 2021 and is likely to record growth at a CAGR of more than 20 percent between 2022 and 2028.⁶ The pandemic drastically disrupted the industry, leading organizations to digitize their entire operational models, including training and development programs. This reflects how digitization has impacted every sphere of life.

The advent of advanced technologies, such as AI, VR, and cloud-based learning management systems (LMS), are key growth drivers. Furthermore, the emergence of an AI-enabled eLearning solution facilitates the development of smart content, digitized study guides, and real-time questioning.

eLearning platforms have been experiencing a major upswing in the last few years. The US Edtech sector gained investments worth $2.2 billion in 2020⁷. Schools and businesses are adopting interactive tools to enhance student engagement and to further improve the learning experience. As a result, service providers are expanding their Edtech products and services.

The pandemic undoubtedly transformed the global eLearning market. Consequently, the sector is expecting a dramatic growth across geographies such as Germany, which is expecting a 22% growth in market size through 2028, and the service providers segment in the US market, which is likely to grow at a CAGR of 17%. The UAE education sector is drastically growing, with the government significantly prioritizing education. The UAE Vision 2021 strongly emphasizes top-rated education system along with its further expansion plan. The India service providers sector is set to register around 30% gain during 2022 to 2028 driven by the growing focus of companies on increasing their portfolios.⁸

Major eLearning Trends

Mobile learning: This undoubtedly remains an under-explored trend among corporations, higher education institutions, and other organizations in the eLearning sector. There are an estimated 4 billion smart phone users overall, thus keeping a lot of room for the trend to pick up.

Micro-learning: Micro-learning offers a very distinct effect, yet is mutually inclusive with macro-learning. This looks like a promising trend to achieve macro-learning/ training objectives.

Video-based learning: Ever since the pandemic, video-based learning has been gaining significant traction. Almost 3 trillion minutes (5 million years) of video material is likely to cross the Internet each month in 2022. To put things into perspective, every second, 1.1 million minutes of video content is streamed or downloaded.

Interactive content: Engagement is the fulcrum of this surging trend. By 2022, interactive content is likely to be a major part of eLearning deliverables.

Social learning: Several eLearning platforms are now integrating forums, chatrooms, and file-sharing possibilities among learners and instructors. COVID-19 created the need for this segment, causing a significant upswing.

STRENGTHS

We are a market-focused organization and have built capabilities to help our customers achieve their business outcomes. The strengths that allow us to retain our market and capability positioning include the following:

Learning focus

Ourmissionistohelpmakelearningsmarterandaccessible to all. We lay a strong emphasis on learning outcomes enabled by efficient yet immersive learning paths. We provide services across the entire learners journey. In the educational publishing segment, these services include content assembly, media asset development, project management, rights and permissions, design, rich media, and digital learning objects. On the enterprise side, these services include content consultation, content authoring and curation, content organization, content delivery, and content upgrade.

Unparalleled platform-based approach

MPS platforms have gained significant momentum in the last five years, and the value proposition of this business is product leadership. Smart and reliable engineering, dedicated customer support, and innovative marketing power our platforms. With the consolidation of our entire tech IP under the HighWire umbrella brand, we have further strengthened our platform suite. We are relentlessly focused on leveraging our combined knowledge to enhance our products.

Focus on meaningful innovation

MPS has a strong focus on developing and implementing highly automated, efficient, scalable, and technologically superior workflows across all stages of content creation. These workflows bring together an optimum combination of input file structuring and validation, XML transformation, pagination, and quality assurance (QA) processes. We are also leveraging our strong technological capabilities to significantly reduce the production time for eLearning solutions. We have empowered employees at all levels in the organization to propose and deliver meaningful changes in the way we produce content.

Financial stability and transparency

MPS is listed on the Indian stock exchanges and had a market capitalization of around INR 1,800 crores as of March 31, 2023. We have recently entered a new phase of growth, with a revenue and PBT CAGR of 9% and 25%, respectively, between FY21 and FY23. We have an active acquisition strategy that is focused on purchasing assets that will enable us to be a more meaningful partner to our customers. Our financial stability enables us to reinvest in our platform technology, production processes, and infrastructure (IT and facilities). This reinvestment further allows us to ramp up production quickly, manage the operational risk, and attract the best talent to service our customers in the best possible way.

Employer brand

MPS is one of the most desired employers in its industry with unrivaled experience, people, and breadth of expertise, all of which contribute to award-winning solutions. The company fosters an inclusive, healthy, and nurturing work environment, which supports and promotes the well-being and growth of 2500+ experts. MPS is a combination of various leading institutions across content outsourcing ( Macmillan, 1970), eLearning (TIS the division was part of one of Indias largest conglomerates for more than twenty-seven years, & EI Design) and independent platform (Stanford, 1995). With a diverse clientele and long history of excellence, the goodwill accumulated in the brand is hard to replicate with newer and smaller companies.

Continuous improvement mindset

MPS has a dedicated Center of Operational Excellence that serves as a consultant and auditor to enhance the companys operations. We have integrated real-time analytics into the operational processes and employed machine learning and natural language processing to build advanced services like content profiling and cognitive quality control. We optimize the workflows, processes, and systems for all our customers leveraging on its scale of operations.

Change design and implementation

MPS has successfully implemented change programs and analytics-led innovation over the 50-year legacy in publishing outsourcing, 30-year leadership status in eLearning, and 25-year innovation status in platforms. As a result, we have a unique vantage point: we have learned from the past, have enabled the present, and are now well positioned to define the future.

OPPORTUNITIES

Total addressable market that is growing

MPS caters to a USD 310 billion+ total addressable market that includes research content outsourcing, digital education content, and corporate eLearning. The market has a significant runway for growth across research content outsourcing, digital education content, and corporate eLearning end-markets. There is a secular shift to digital and increased outsourcing across all end markets with an increased need for an end-to-end solutions provider.

Vendor consolidation

In the markets that MPS serves, customers prefer to reduce the total number of vendors for ease of management and cost advantages. This tilts the balance in favor of the larger providers such as MPS, which have been regularly augmenting their services through organic and inorganic strategies. Another round of vendor consolidation emerged as a consequence of the COVID-19 pandemic as stronger vendor partners such as MPS have been able to create harder lines of differentiation, while smaller companies have been unable to adapt to the new operating model.

Higher demand for remote learning

The eLearning industry is growing at more than 10% per annum and presents opportunities for growth. Educational institutions are expanding their digital presence, and corporates are increasingly enhancing their ratio of virtual training to total learning and development. MPS Interactive is well positioned to capitalize on these forces.

Rapid digitization

The pandemic confined everyone to their homes. Due to the constraints on movement, audiences are consuming more content online and on mobile devices, leading to a surge in traffic for platforms. Businesses are looking for eLearning solutions that will help them adapt to the new normal and regain their level of productivity. In the long run, this represents a positive development as companies emerge from the crisis with an increased acceptance of digital learning methods. In the medium term, we will balance the impact of our clients economic pressures and delayed expenditures with our ability to focus on healthy sectors, mission-critical expenditures, price-competitive solutions, and an altered (increasingly digital) business development model. We will leverage our comprehensive suite of learning services and platforms to help our customers navigate the new normal.

THREATS

A possible threat to the business model could be customers trying to own their offshore operations for control. Having said that, this does not appear to be a probable scenario as most captive units owned by customers have either been closed or sold to third parties.

RISK MANAGEMENT

Type of Risks	Description	Mitigation
Pricing risk	Due to increased competition, the company is witnessing high price pressures. This might have an adverse impact on the companys profitability.	MPS has established strong brand loyalty in the segment. Moreover, its emphasis on increasing productivity and automating its operations has allowed it to maintain its profitability alongside improving the overall efficiency of its operations.
Currency risk	Given its vast presence, the company is exposed to risks associated with the fluctuation of currency value.	MPS has adequate foreign exchange forward covers to cope with currency fluctuations. The forward cover is booked for foreign currency fluctuation risk in US dollars and GBP. The company has also hired a consultant to advise on currency and booking of contracts.
Technology risk	The company is exposed to risks associated with malware and system hacks. This might lead to data loss, which could result in financial losses, company disruptions, and the loss or leakage of personal information.	MPS is always working to strengthen the security of its digital assets by implementing steps to effectively combat and manage cyber-attacks. The company has implemented cutting-edge technologies to boost operational efficiency and cross-departmental communication. To avoid cyber-attacks, a variety of cybersecurity measures, such as firewalls and port restrictions, have already been implemented.
Talent acquisition risk	It is vital to improve skills and knowledge on a regular basis to thrive in a competitive environment. The companys prospects may be harmed if it is unable to retain competent experts or does not have enough training opportunities for its workforce.	The organization conducts necessary training and development programs on a regular basis to involve its staff in various activities and motivate them through mentorship programs. It hires a multigenerational team to create industry-leading content, learning, and platform solutions. Employees at all levels of the company are empowered to suggest and implement beneficial improvements in the way they produce content.

INTERNAL CONTROL

The company has well-equipped and effective internal control systems in place that match the scale of its sector and the complexity of the market it works in. Internal controls are commensurate with its size and the nature of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable statutes, safeguarding assets from unauthorized use, executing transactions with proper authorization, and ensuring compliance with corporate policies.

The Audit Committee of the Board of the Company undertakes a comprehensive system of internal audits and periodic assessments to ensure compliance with best practices. The company has laid down internal financial controls as detailed in the Companies Act, 2013.

For the financial year 2022-2023, the company has engaged M/s. PricewaterhouseCoopers Services LLP as the internal auditors of the Company to report on the financial controls of the company and M/s. Walker Chandiok & Co. as the statutory auditors of the company to report on the financial statements (standalone & consolidated financials) of the company.

The internal audit team conducts quarterly audits across the company, which include a review of the operating effectiveness of internal controls. The audit committee reviews reports submitted by the management and audit reports submitted by internal auditors and statutory auditors. Suggestions for improvement are considered and the audit committee follows up on corrective action.

HUMAN RESOURCES

The company considers its people and their well-being to be the most crucial factor in its success and growth. A capable and motivated HR team works round the clock to ensure that a culture of inclusion and engagement exists in the organization. Throughout the year, staff were reminded of the need for proper hygiene and encouraged to maintain social distancing. _

The HR department took on several projects to improve the workplace culture and employee well-being. Below are a few initiatives taken by the team:_

• Interactive sessions with experts for the mental and physical well-being of all employees._

• During troubled times, insurance coverages were expanded and restructured to provide maximum benefits to employees and their dependents._

• Strict protocols for social distancing and hygiene were implemented to ensure the safety and well-being of all employees. _

• The company bore the cost of vaccination drives conducted at all company locations for every employee. _

• The companys infrastructure was upgraded to provide a state-of-the-art work environment, which makes collaboration between teams more accessible and efficient. _

• The leadership team conducts sessions for key employees at various locations with the objectives of inculcating team spirit, negotiation skills, and cross-team engagement. _

• Various engagement events such as team lunch, outdoor fun, and gaming activities are conducted regularly to provide a refreshing change to the employees._

In addition to the activities mentioned above, the organization has a performance-based reward and recognition program in place that allows the leadership team to recognize and motivate talent at the individual, team, and company levels. The CEO leads Zoom meetings to identify and announce the accomplishments of individual members and groups who collaborated to achieve the companys goal._

CORPORATE SOCIAL RESPONSIBILITY (CSR)

MPS collaborates with NGOs and charitable trusts to assist marginalized populations to positively reinforce its objectives. Its social mission is driven by its fundamental triple E principles, which ensure the safety and growth of all those involved. During the post-COVID times, the MPS family works even harder to uplift the community and areas it operates in.

Education is the most valuable gift that MPS offers to the society to ensure its long-term viability. The companys CSR initiatives strive to empower the communities it operates in by facilitating their educational needs.

Resultantly, the employees put in significant efforts and engage in bringing a healthy change. The company essentially supports programs that provide education for girls as well as vocational and computer skills training. It also works with humanitarian groups to construct homes for children suffering from mental and physical ailments and works toward educating students with learning challenges. Through the efforts the company has made, it has been successful in making a significant difference in the society as a whole.

CSR initiatives taken during FY 2022-23

Educating girls: MPS works with IIMPACT, a non-profit organization, to adopt schools that provide high-quality education to girls from underserved regions. They aim to shatter the cycle of illiteracy through local community-based learning centers that provide girls with meaningful and stimulating education up to class 5 and guide them for their entry into mainstream education.

The Company has supported 51 learning centers during the financial year 2022-23 in the states of Uttarakhand (Dehradun, Haridwar) and Haryana (Mewat), wherein education is provided to underprivileged girls.

Instilling higher values: MPS works with Vedanta Cultural Foundation and Vedanta Institute Delhi towards promoting life, education, knowledge and research in philosophy, culture, and heritage. The Foundation is involved in promoting a life of mental peace and dynamic action. It equips people with clarity of intellect to deal with the challenges of life that lead them to the ultimate goal of inner peace and self-realization.

During the financial year 2022-23, the Company supported the CSR projects of Vedanta Cultural

Foundation by way of conducting educational programs directed towards inculcating higher values of life. The Company has contributed to providing a continuous three-year residential program at Vedanta Academy, value-based short-term educational programs at different locations in India, public lecture series to develop an awareness of the educational program, and weekly study classes by the alumni of the academy for those interested in delving deeper into the knowledge.

Raising awareness: MPS believes in normalizing mental health issues and further promotes awareness about it through its collaboration with the Sambandh Health Foundation. They are committed to improving public health with a focus on mental health and tobacco control. The foundation provides support to people living with mental illnesses, educates people about mental illnesses along with the harmful effects of tobacco consumption, and advocates for better treatment and community support for the quick recovery of patients.

During the financial year 2022-23, the Company supported the CSR projects of Sambandh Health Foundation in Gurgaon, Gandhi Nagar, Basai, and Jharsa towards mental illness and the promotion of mental health of persons in India. Sambandh offers a healing community for those who have their lives disrupted by mental illness.

Supporting special children: MPS works with Prem Charitable Trust, which provides a loving and caring home to mentally and physically challenged and less fortunate children. They work tirelessly with these special children and their families, irrespective of their caste, creed, religion, and financial background, to unlock their potential and enable them to serve others.

The Company has contributed to the maintenance of homes for mentally and physically challenged children, and has been paying salaries to the physiotherapist, occupational therapist, and special educator.

Learning disability: MPS works with Seth GS Medical College and KEM Hospital, Diamond Jubilee Society

Trust, that undertake research in the field of medicine, promote medical education, and undertake development programs to upgrade healthcare facilities in various sectors of the society. The trust passes the benefits arising from the research to the slum dwellers of Mumbai through their public hospitals.

The Company has provided financial assistance to support the learning disability project of KEM Hospital. They assist disabled children through the childs detailed clinical and neurological examination, followed by the testing of the childs intellectual capacity (IQ testing), and, finally, the educational testing of the child.

Cautionary Statement

Certain statements in the Annual Report, including this analysis concerning the companys objectives, expectations, estimates, projections, and future growth prospects, may be regarded as forward-looking statements, which involve some risks and uncertainties that could cause actual results to differ materially. The risks and uncertainties relating to these statements include, but are not limited to, fluctuations in earnings and intense competition in publishing and eLearning services business, including those factors that may affect our cost advantage, wage increase in India, reduced demand for services in our key focus areas, and general economic conditions affecting our businesses over which the company does not have any control.