(A) Industry structure and developments.
The Post- COVID-19 pandemic had a favourable impact on the business
software and services market. According to a report by NTT Ltd which is a Japanese
corporation multinational information technology service and consulting company
commissioned by International Data Group, Inc. (IDG), the institutionalization of the
work-from-home model amid local and worldwide quarantines has boosted the demand for
value-added services for mitigating security concerns. Moreover, economic uncertainties
caused by the pandemic have encouraged several vendors to focus on customer service-driven
methods, including proactive support in customers digital journeys.
In CY 2021, the global business software and services market size was
valued at USD 474.61 billion in 2022 at a Annual growth rate (AGR) of 10% IT services is
estimated to be USD 525.77 billion in 2023 characterized by a shift to digital
technologies, and adoption of DevOps, and as-a-service models. Business Process Management
grew by 4.5% over the prior year driven by a greater focus on robotic process automation
as customers automate repetitive tasks and focus on strategic work.
The market growth is likely to be hampered by higher authorization
prices and the need for quick assistance. The cost of licensing a solution does not
include the cost of software development. While the cost of solution maintenance and
support is included in the standard software price, additional integration and
personalization often result in higher maintenance and support costs. Businesses often end
up incurring additional costs for timely maintenance and frequent updates.
Share of Digital in industry revenues has jumped from 20% last year to
now in the range of 30%-32%. Nine digital technology areas will emerge as a
fastest-growing and highest-impacting, with the combined potential to deliver one-third of
the USD 100 trillion. The nine areas include three foundational technologies Big Data and
Analytics, Cloud. Computing, and Cyber security and six advanced technologies Artificial
Intelligence, Internet of Things, 3D Printing, Robotics, Blockchain, and Immersive Media.
STTL has a notable global footprint and a fore-runner in digital
innovation, has been an integral part and an active partner in this ambitious plan
committed to transforming millions of lives. With over more than two decades of committed
drive in IT, STTL is able to offer an unparalleled single eye view of macro solutions and
its perspective is markedly well rounded.
STTL is equipped to provide end-to-end IT solutions and services, helps
businesses of different verticals and horizontal lines thrive by integrating end-user
computing, virtualization, networking and resilient IT infrastructure in conjunction with
professional security services. The companys vast range of technical and service delivery
expertise assists in driving value driven and customer centric IT solutions to industry.
The companys solutions are highly in demand as they combine Business
Intelligence & Machine Learning, Managed Services & Cloud Solutions. Meanwhile,
with its Big-Data knowhow, which is the fuel of 21st Century, Information technology
insights and rich industry specific knowledge, and expertise is positioned to enable
businesses to use innovation to leverage growth.
(B) Business Segments at a glance
- Software Services
- E-Governance Solutions
- System Integration
- SAP Solutions (S4 HANA/R3/B1)
- Enterprise Mobile Applications
- Digital Transformation
(C) Opportunities and Threats
Major Opportunities for the Company are as follows:
- Rise in new geographical markets of Different cities of the India and all over the
world.
- Increase in Emerging Technologies such as Block chain, AI, ML
- Increase of IT-Automation in all the sectors
- Long experience of the promoters in the industry;
- End-to-end ICT solution under a single umbrella
- We follow the Quality standards (CMMI Maturity Level 5 Certification) which are followed
by leading IT companies.
- Provide flexibility & transparency to work as an extension IT arm of the customer.
- Track Record of successful execution of projects.
- Experience across various Industry Vertical.
Major Threats/ Challenges to the Company are as follows:
- Technology Dependency
- Integration with various Technology
- Manpower Retention
- Competition
- Cyber attacks
- Disruption and Uncertainty in Business due to Covid-19 pandemic or any other uncertainty
due to Act of God.
(D) Risk management
STTLs Board of Directors and executive management promote a
risk-intelligent and risk-aware environment to protect stakeholders, safeguard operations
and people, ensure quality delivery of services to its clients, and build transparency in
the business. Our Enterprise Risk Management integrated structure minimizes risk and
maximizes performance with a comprehensive strategy that identifies and manages internal
and external risks, and ensures compliance with due care and diligence. This approach
combines strategic and operational practices to support the risk-enabled decision making
intrinsic to supporting STTLs business objectives and its culture.
As part of business continuity management, STTL Technologies has
established a response oriented policy for mitigating various risks and plan to oversee
its global response and monitor the pandemic situations in the locations where it
operates.
While navigating the matters, your Companys response plan was
actively in effect throughout the year to continually oversee its response around five key
focus areas: safeguarding employees, minimizing impact to clients, reducing the financial
impact to STTL, maintaining supply chain resilience, and providing support to the
communities in which STTL operates. Crisis governance was guided by your Companys
executives crisis management team, advice from the Board, and engagement with external
experts to bring best-in-class capabilities to ensure business continuity with by the
optimum utilization of resources for the betterment of all stakeholders of STTL. Your
Company apply the following strategies for mitigating its risk such as Risk
Avoidance, Risk Reduction, Risk Sharing, Risk Retention.
(E) Segment wise performance.
The Geographical Segment wise standalone and consolidated financial
performance of the Company during the Year is as follows: (Amount in Rs Lakhs)
|
Standalone |
Consolidated |
| Particulars |
F.Y.2022-23 |
F.Y.2021-22 |
F.Y.2022-23 |
F.Y.2021-22 |
| Segment Revenue |
|
|
|
|
| a) Domestic |
13623.39 |
11371.16 |
13623.39 |
11288.09 |
| b) Export |
1596.14 |
1465.45 |
2754.99 |
2670.94 |
|
15219.54 |
12836.61 |
16378.38 |
13959.04 |
| Total |
|
- |
- |
- |
| Less: Inter Segment Revenue |
|
|
|
|
| Net Sale/Income from Operations |
15219.54 |
12836.61 |
16378.38 |
13959.04 |
| Total Profit before Tax |
1273.09 |
868.96 |
1338.85 |
877.39 |
| Segment Assets |
|
|
|
|
| a) Domestic |
10845.57 |
10386.10 |
9888.21 |
10608.68 |
| b) Export |
2901.47 |
658.33 |
4425.30 |
879.75 |
| Unallocated Assets |
466.04 |
759.58 |
467.13 |
770.61 |
| Total |
14213.08 |
11804.01 |
14780.65 |
12259.04 |
| Segments Liabilities |
|
|
|
|
| a) Domestic |
13047.98 |
11435.75 |
13231.73 |
11668.63 |
| b) Export |
1096.57 |
343.00 |
1442.17 |
564.42 |
| Unallocated Liabilities |
68.52 |
25.25 |
106.75 |
25.99 |
| Total |
14213.08 |
11804.01 |
14780.65 |
12259.04 |
(F) Outlook, Risks and concerns
This section lists forward looking statements that involve risk and
uncertainties. Our actual results could differ materially from those anticipated in this
statements as a result of certain factors. Our Outlook, Risks and Concerns are as follows:
1. Our revenues could be significantly affected if the governments in
countries in which our Customers or business partners are based, restrict companies from
outsourcing work to non domestic corporations.
2. Our Companys success depends largely upon its skilled
professionals and its ability to attract and retain these personnel. The Industry where
our Company operates is a highly employee intensive industry.
3. Significant security breaches in our computer systems and network
infrastructure and fraud may impact our business.
4. Exchange rate fluctuations in various currencies in which we do
business may negatively impact our business, financial condition and results of
operations.
5. Changes in market trends and consumer preferences and increase in
competitors that are largely beyond our control may affect our business, financial
condition, results of operations and prospects.
6. Changes in Government regulations may adversely affect our business
operations.
7. Changes in taxation policies may affect our business operations
& results of Operations.
(G) Internal control systems and their adequacy.
The Company is well equipped and robust system of internal control with
an adequate internal financial controls. The companys Audit Committee has
established an ‘Internal Financial Control Policy to ensure that the financial
and other sensitive information of the Company is safeguarded from any kind of leaks or
unwarranted disclosures. The Company has a continuous monitoring mechanism, which enables
it to maintain adequate standards of the control system, and helps in managing defaults,
if any, in timely manner.
(H) Discussion on financial performance with respect to operational
performance.
Financial Performance FY23 Comparison: Year-on-Year There is
significant improvement in the financial performance of the company compared to last year.
The total turnover of the company in FY 2022-23 is increased by 19.50% from Rs. 12962.66
lacs of previous year to Rs. 15484.61 lacs. The Net profit after Tax of the company is
also increased significantly by 45% from Rs. 623.09 lacs to Rs. 905.54 lacs. Whereas
Profit before tax increased by almost 50% to Rs. 1273.09 lacs compared to previous year of
Rs. 852.16 lacs.
(I) Material developments in Human Resources / Industrial Relations
front, including number of people employed:
The Company considered their employee as the most important assets. The
Company always believes in the ideology of team building and Employees welfare.
The Company also have 24 apprentice trainees for its various
departments during the year to provide them the technical training.
As at March 31, 2023 there were total 715 Nos. of employees on the role
of the Company. During the year we added 146 new hires.
(J) Disclosure of Accounting Treatment:
In the Preparation of Financial Statements Company has followed the
treatment as prescribed by the Accounting Standards.
(K) Details of significant changes (i.e. change of 25% or more as
compared to the immediately previous financial year) in key financial ratios, along with
detailed explanations therefore:
During the year under review, there were significant changes in key
financial ratios as provided under
- Debt Service Coverage Ratio by 91.87% due to increase in loan, there is change in ratio.
- Return on Equity Ratio by 35.60%, since Return on equity is improved compared to
previous year.
- Debt Equity Ratio increased by 4537.60% during the year company has obtained fresh
finances from banks for new project. Hence there is a significant increase in Debt.
- Inventory turnover Ratio is reduced by 45.27% due to average inventory is reduced.
- Trade receivable Ratio is reduced by 31.87% due to average trade receivables are
reduced.
- Return on Capital Employed Ratio is increased by 35.60% due to improve in return on
equity.
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