tips industries ltd Management discussions

To

The Members

Tips Industries Limited

Your Directors are pleased to present the 26th Annual Report on the business and operations of the Company, together with the Audited Financial Statements for the financial year ended March 31, 2022. The Management Discussion and Analysis is also included in this Report.

THE INDIAN MEDIA AND ENTERTAINMENT INDUSTRY

Indias economy is recovering from the Covid-19 pandemic. In a globalised world, large, open economies like Indias are also affected by external events. The war in Ukraine, rising interest rates and tightening of liquidity will affect Indias growth this year. Despite all these uncertainties, the World Bank expects Indias GDP to grow at 7.5% in the coming year.

The Indian M&E sector recovered by 16.4% to Rs.1.61 trillion (US$21.5 billion), still 11% short of pre-pandemic 2019 levels, due to the second wave of COVID-19 which impacted the April - June quarter. While television remained the largest segment, digital media cemented its position as a strong number two segment followed by a resurgent print. The M&E sector is expected to grow 17% in 2022 to reach Rs.1.89 trillion (US$25.2 billion) and recover its 2019 levels, then grow at a CAGR of 11% to reach Rs.2.32 trillion (US$30.9 billion) by 2024.

Except for in-cinema advertising and TV subscription, all M&E segments grew in 2021. Digital media grew the most at Rs.68 billion and consequently, increased its contribution to the M&E sector from 16% in 2019 to 19% in 2021.

The share of traditional media (television, print, filmed entertainment, OOH, music, radio) stood at 68% of M&E sector revenues in 2021, down from 75% in 2019.

Segment	2019	2020	2021	2022E	2024E	CAGR 2021-2024
Television	787	685	720	759	826	5%
Digital media	221	235	303	385	537	21%
Print	296	190	227	241	251	3%
Online gaming	65	79	101	120	153	15%
Filmed entertainment	191	72	93	150	212	32%
Animation and VFX	95	53	83	120	180	29%
Live events	83	27	32	49	74	32%
Out of Home media	39	16	20	26	38	25%
Music	15	15	19	21	28	15%
Radio	31	14	16	18	21	9%
Total	1,822	1,386	1,614	1,889	2,320	13%

All figures are gross of taxes (INR billion) for calendar years EY estimates

Source: FICCI-EY Media & Entertainment (M&E) Report 2022

MUSIC

Music unites us, therefore it is priceless. It permeates our culture across all age groups, which makes India one of the worlds most exciting music markets, as reflected in our growth rates. The recorded music industry in India has grown at CAGR of 15.78% over the past 5 years compared to the global industrys 10.61% over the same period. The Indian music market is ranked 17th in the world with revenue of Rs. 1620 crores as per IFPI metrics. According to IMI, the recorded music industry grew 20.3% in CY2021 over the previous year. Indias market is largely digital with revenues from physical sales accounting for 1.4% and Sync revenues contributing 5.4% to total industry revenues. It is expected that Industry revenues will surpass Rs.28 billion in the medium term on the back of increasing digital revenues and performance rights.

Category	Revenue
Streaming	86.8%
Other Digital	2.6%
Physical	1.4%
Performance Rights	3.8%
Synchronisation	5.4%

Source: IMI Report

Share of physical sales grew strongly from 1% in 2020 to 1.4% in 2021, albeit on a depleted base. Sales of vinyl records have been growing for ten years globally, but in India there has been no market so far, but indications are that it may be changing.

Digital revenues comprised 89.4% of total revenues, up from 68% in

2019. Younger people are generally early adopters of technology and more likely to subscribe to music streaming services. Music listeners aged 16-44 years are more likely to pay for audio streaming as they prefer an ad-free experience, the freedom to listen to anything, at any time, at the click of a button. Convenience and availability of millions of songs for a small price is driving penetration of subscription based music streaming services.

KEY ASPECTS OF THE MUSIC INDUSTRY

Music is part of the broader content industry that comprises news, television serials, films, and music. Each of these sub-segments has their own economic attributes and appropriate monetization methods.

• Value of content

Many factors determine the value of content. Content that can be monetized multiple times naturally commands greater economic value. Music ranks at the top of the content pyramid when ranked on repeated monetization.

Once aired, news bulletins and TV serials lose relevance very quickly. Viewers rarely revisit such content. Films hold a special appeal and can be repeatedly aired. Superhit films may be viewed multiple times by audiences. Such films attract audiences even many years after release.

Music lovers can be very passionate about their favorite music and may listen to their favourite songs multiple times a week. It is entirely possible that listeners hear their favorite songs thousands of times over their lifetimes.

• Intellectual Property Rights (IPR)

The Copyright (Amendment) Act, 2012 protects music copyrights for 60 years in India. This is the longest period of protection when compared to any other type of intellectual property rights. In the United States, music copyrights are protected for much longer periods.

IPR protection for such long durations allows music labels to exploit multiple monetization strategies over time. Catalogues benefit from technological evolution, inflation, and increased market penetration over such long periods.

• Impact of Internet

The internet has made it possible to access the entire global audience for content with minimum intermediation. Physical distribution channels for selling cassettes, CDs and DVDs have been disrupted. In todays digital world, every content owner can directly connect with the end consumer via the internet. This ability to reach large audiences directly has improved terms of trade for content owners vis-a-vis distributors and other content aggregators.

• Convenience

Until the first decade of the current century, music lovers had to carry devices such as Walkmans or iPods or USB drives to hear music on the go. These and other functions have now converged into a single device; the smartphone. Listeners no longer need to carry separate devices; smartphone apps make music available 24x7 with a tap and a swipe.

• Rising Data Consumption

The Ericsson Mobility Report- November 2021 (EMR) estimates that data usage per smartphone will increase from 18 GB/month in 2021 to 50 GB/month in 2027. The report estimates total Mobile Data Traffic to grow at 18% CAGR between 2021 and 2027 in India. FICCIs M&E Report 2021 states that news, books, music, video, and gaming accounted for over 75% of data consumption in India. Rising data consumption provides a tailwind for growth.

• More Subscribers

As per EMR, there were 81 crore smart phone subscriptions in India in 2021 compared to 73 crore in 2020 . This number is expected to touch 120 crore in 2027. According to TRAI, current tele-density in rural areas is only 59.5%. A lot of people are yet to be connected to smartphones and the Internet, so there is huge headroom for growth.

• Faster Networks

The number of 4G connections are expected to decline from 79 crore in 2021 to about 71 crore in 2027. 5G subscriptions are expected to be 50 crore in 2027 from none today. Higher speeds provide seamless user experience and improve adoption. Upgrading to faster connections will continue to drive an increase in content consumption.

• Smarter Phones

Smartphones provide improved user experience for media consumption compared to feature phones. New users and upgrades from feature phones to smartphones are both tailwinds for music consumption.

• Cheap Data

India has the lowest data costs in the world. Given such low costs, data prices are no longer a hindrance to adoption of mobile Internet.

EMR estimates data usage per smartphone to increase from 18.4 GB/Month in 2021 to 50GB/Month in 2027. Smart phones and video drive data consumption.

BUSINESS OVERVIEW

TIPS is a leading Company in the Media & Entertainment Industry, and engaged in the business of exploitation of audio content library digitally in India and overseas. Founded in 1975, it is one of the oldest companies in the Indian M&E Industry. Mr. Kumar Taurani and Mr. Ramesh Taurani, the co-founders of TIPS, are well-known names in the Indian M&E space with a proven track record of producing films and music that have wholesome entertainment for the entire family.

One of the strongest assets of TIPS is its rich and evergreen music collection. Its large and diversified music library has a collection of over 29,000 songs across all genres and major languages. The songs are digitized and available on all the leading online music stores, applications, and web platforms.

FINANCIAL RESULTS

The Company earned Total Revenue, including Other Income of Rs. 13,879.52 lakhs as compared to the previous year of Rs. 9,542.22 lakhs. The Net Profit after Tax for the year stood at Rs. 6,455.55 lakhs, as compared to Rs. 4,346.88 lakhs in the previous year.

The highlights of the Financial Results of the Company for the year under review, along with the figures for the previous year, are as follows:

(Rs. in Lakh)

Particulars	2021-22	2020-21
Income	13,879.52	9,542.22
Profit/(Loss) before Depreciation, Interest, Provision for Contingencies and Taxation	8,943.93	6,005.67
Less: Depreciation and Interest	82.22	83.26
Profit/(Loss) before Provision for Taxation, Extraordinary and Prior Period year items	8,861.71	5,922.41
Less: Provision for Taxation
Current Tax	2,300.00	1,473.91
Taxes in respect of earlier years	90.55	136.90
Deferred Tax	15.61	(35.28)

Particulars	2021-22	2020-21
Profit/(Loss) after Provision for Taxation but before Extraordinary and Prior Period year items	6,455.55	4,346.88
Less: Prior Period Expenses	0.00	0.00
Profit/(Loss) after Taxation	6,455.55	4,346.88
Add: Balance Brought Forward	7,935.21	3,957.24
Profit/(Loss) after Taxation available for Appropriation	14,390.76	8,304.12
Transfer to General Reserves	0.00	0.00
Share Capital	1,296.87	1,296.87
Reserves & Surplus	8943.45	8,828.90

PERFORMANCE REVIEW

TIPS is confident that its music business will continue to deliver consistent growth and revenue. The Company has always been at the forefront of leveraging latest technology and innovation in the industry. The music library of the Company is one of the most exhaustive in the industry comprising a collection of over 29,000 songs, which are available for streaming and download across leading digital marketplaces like iTunes and Google Play, as well as popular streaming platforms like Amazon Prime and Spotify. During the financial year 2021-22, Company has released 276 new songs. The music revenue for FY 2021-22 was Rs. 13,558.64 lakhs as compared to Rs. 9,053.00 lakhs in the previous year.

SCHEME OF ARRANGEMENT AND DEMERGER

With the view to create separate and focused entities for Music and Film businesses, for unlocking the shareholders value and for capturing attractive growth opportunities, the Board of Directors, at its meeting held on May 10, 2021, approved the Scheme of Arrangement and Demerger between Tips Industries Limited ("Demerged Company"), Tips Films Limited ("Resulting Company") and their respective Shareholders, under Sections 230 to 232 and other applicable provisions of the Companies Act, 2013.

The Honble National Company Law Tribunal (NCLT), Mumbai Bench vide its order dated March 3, 2022 (the "Order"), had approved the Scheme of Arrangement and Demerger to demerge the Film Division (as defined in the Scheme) from Tips Industries Limited and the same has been vested and transferred in Tips Films Limited, on a going concern basis with effect from the Appointed Date i.e. April 1 2021. The Scheme had been made effective from March 23, 2022.

DIVIDEND

The Directors recommend a final dividend of 20%, i.e. Rs 2.00 /- (Rupees Two) per share on fully paid-up Equity Share of Rs.10/- each of the Company. Dividend is subject to approval of members at the ensuing Annual General Meeting and shall be subject to deduction of income tax at source.

The Board of Directors of the Company had adopted the Dividend Distribution Policy on June 14, 2021 in line with the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015. The Policy is uploaded on the Companys website at https://tips.in/wp-content/ uploads/2021/09/Dividend-Distribution-Policy.pdf.

RESERVE

The Board of Directors has not recommended transfer of any amount to reserves and the amount of Rs. 6,455.55 lakhs is retained in the Profit and Loss Account.

SHARE CAPITAL

The paid-up Equity Share Capital as of March 31, 2022, stood at 1,29,68,659 Equity Shares.

The Company has not issued shares with differential voting rights, nor has granted any stock options or sweat equity. As of March 31, 2022, none of the Directors of the Company hold instruments convertible into equity shares of the Company.

REPORT ON PERFORMANCE OF SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES

The Company does not have any subsidiary, associate and joint venture company.

CORPORATE GOVERNANCE REPORT

Pursuant to Regulation 34(3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, a separate report on Corporate Governance along with a certificate from the Auditors on its compliance, forms part of this Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

The following key Board level changes were effected to evolve and realign the senior management team after receiving the final NCLT order dated March 3, 2022:

• Director Retiring by Rotation

In terms of Section 152 of the Companies Act 2013, Mr. Girish Taurani, Director of the Company, is liable to retire by rotation at the ensuing Annual General Meeting and, being eligible, offers himself for re-appointment. The Board recommends the same for your approval.

• Re-appointment of Managing / Executive Directors

The Board of Directors of the Company, on the recommendation of the Nomination and Remuneration Committee, at their Meeting held on May 30, 2022, approved the re-appointment of Mr. Kumar Taurani as a Chairman and Managing Director and Mr. Girish Taurani as an Executive Director of the Company and change in designation of Mr. Ramesh Taurani as an Executive Director, for a period of three years with effect from June 1, 2022. The Board recommends the appointment of Directors for your approval.

• Resignation of Independent Director

Ms. Radhika Dudhat and Mr. Venkitaraman lyer have tendered their resignation from the office of Independent Director of the Company with effect from May 30, 2022. The Board of Directors place on record their deep appreciation for the valuable services rendered as well as advice and guidance provided by Ms. Radhika Dudhat and Mr. Venkitaraman lyer during their tenure.

• Appointment of Independent Director

Ms. Tara Subramaniam and Mr. Shashikant Vyas were appointed by the Board of Directors as an Additional Director in the capacity of Independent Director on the Board of the Company with effect from May 31,2022 for a term of 5 (five) years subject to regularization of the appointment by the shareholders of the Company.

• Declaration by Independent Directors

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act 2013, read with rules made thereunder, and Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

• Key Managerial Personnel

Pursuant to the provisions of Section 203 of the Companies Act 2013, the Key Managerial Personnel of the Company as on March 31, 2022, are Mr. Kumar Taurani, Chairman and Managing Director; Mr. Ramesh Taurani, Managing Director; Mr. Sunil Chellani, Chief Financial Officer; and Ms. Bijal Patel, Company Secretary.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the Board has carried out performance evaluation. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

DIRECTORS RESPONSIBILITY STATEMENT

To the best of our knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 134(3)(c) of the Companies Act 2013:

a. that in the preparation of the Annual Accounts for the year ended March 31, 2022, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b. the Directors had 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, 2022, and of the profit of the Company for the year ended on that date;

c. that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. the annual accounts have been prepared on a going concern basis;

e. that the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f. that the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

DETAILS OF BOARD AND COMMITTEE MEETINGS

• Board Meetings

The Board of Directors of the Company met five times during the financial year, i.e., from April 1,2021, to March 31,2022, on May 10, 2021, June 14, 2021, July 27, 2021, October 29, 2021 and January 24, 2022. Details of the Board Meetings and attendance of the Directors are provided in the Corporate Governance Report, which forms part of this Annual Report.

• Committees of the Board

With a view to having a more focused attention on the business and for better governance and accountability, the Board has constituted the Committees viz. Audit Committee, Stakeholders Relationship Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee and Risk Management Committee.

The details with respect to the compositions, roles, terms of reference, etc. of relevant committees are provided in the Corporate Governance Report of the Company, which forms part of this Annual Report.

AUDITORS

• Statutory Auditors

M/s. SSPA & Associates, Chartered Accountants, (Firm Registration No. 131069W) were re-appointed as the Statutory Auditor of the Company at the 23rd Annual General Meeting held on September 23, 2019, to hold the office for a period of 5 (five) years till the conclusion of the 28th Annual General Meeting to be held in the year 2024, in terms of the applicable provisions of Section 139 of the Act read with the Companies (Audit and Auditors) Rules 2014.

The Notes to the Financial Statements are self-explanatory and do not call for any further comments. There is no audit qualification, reservation or adverse remark for the year under review.

• Secretarial Auditors

Provisions of Section 204 read with rules made thereunder, M/s. N.L. Bhatia & Associates, Practicing Company Secretaries (UIN: P1996MH055800), have been appointed to undertake Secretarial Audit of the Company. The report of the Secretarial Auditor is annexed herewith as Annexure I and forms part of this Report.

The said report does not contain any observation or qualification which requires any explanation or comments from the Board under Section 134(3) of the Companies Act 2013.

• Internal Auditors

Pursuant to provisions of Section 138 read with rules made thereunder, the Board has appointed M/s. Maheshwari & Co., Chartered Accountants (Firm Registration No. 105834W) as Internal Auditors of the Company for the Financial year 2021-22 to check the internal controls and functioning of the activities and recommend ways of improvement. Internal Audit is carried out on a quarterly basis, and the report is placed in the Meetings of the Audit Committee and the Board for their consideration and direction. Their scope of work is as decided by the Audit Committee and the Board of Directors.

INTERNAL CONTROL AND FINANCIAL REPORTING SYSTEMS

The Internal Financial Controls with reference to financial statements as designed and implemented by the Company are adequate. It has documented the procedures covering all financial and operating functions and processes. These have been designed to provide a reasonable assurance with regard to maintaining of proper accounting controls for ensuring the reliability of financial reporting, monitoring of operations, protecting assets from unauthorized use or losses and compliance with regulations.

Adequate internal control systems commensurate with the nature of the Companys business and size and complexity of its operations have been recognized. Internal control systems ensure the reliability of financial reporting, timely feedback on the achievement of operational and strategic goals, compliance with applicable laws and regulations and that all assets and resources are acquired economically, used efficiently and adequately protected.

During the year under review, no material or serious observations have been received from the Internal Auditors of the Company with respect to inefficiency or inadequacy of the controls.

RISK MANAGEMENT

TIPS has a well-defined policy to foresee, identify and analyze risks and take suitable action to mitigate and minimize the impact of such risks. Accordingly, the Company has identified the followings risks that can impact its business performance and plans:

• Piracy

Copyright infringement remains a challenge for the music ecosystem. An estimated 27% of those surveyed used unlicensed methods to listen or obtain music in the past month, while 23% used illegal stream ripping services. The availability of quick remedies, including blocking orders, to tackle such pirate services is vital to protect the music industry and other creative industries. Furthermore, app stores and ISPs that host such services need to be proactive in recognizing this form of infringement and work with industry bodies to curb piracy. Piracy in the music ecosystem has reduced from 76% in 2018 to 67% in 2019 and remained flat in

2020, but is still higher than the global average of 27%. China has succeeded in curbing piracy with an estimated 96% of consumers listening to licenced music.

OPPORTUNITIES

• Digital / OTT Rights

India is second globally in the digital consumption of services, following China. Video subscriptions grew 29% in 2021 as sports content went behind paywalls. Paid subscriptions crossed 80 million and generated Rs.56 billion in revenues. OTT players are expected to spend Rs.300 billion on content over 2021-25, Netflix, Disney and Amazon are expected to spend USD 66.6 billion on content in CY2022, a growth of 18.2% yoy.

OUTLOOK

We believe the following secular trends will continue to drive growth in the recorded music industry.

• Consumer Trends and Demographics

Consumers today engage with music in more ways than ever. In

2021, Indian consumers spent 21.9 hours listening to music each week compared to 19.1 hours in 2019. Data indicate that the hours spent listening to music can grow further. Indians in the age group of 25- 34 listened to 24.8 hours of music a week. Consumption through paid audio streaming increased from 2.4 hours in 2019 to 3.3 hours in 2021. According to Nielsen, in 2019, teens and millennials in the United States listened to an average of 32.6 and

29.7 hours of music each week, respectively, above the 26.9 hours for all U.S. consumers.

Demographic trends and smartphone penetration have been key factors in driving growth in consumer engagement. Younger consumers typically are early adopters of new technologies, including music-enabled devices.

Members of older demographic groups are also increasing their music engagement. Indians in the age group of 55-64 listened to

16.7 hours of music in 2021 up 1.9 hours over 2019. According to

an IFPI survey of 19 leading geographic markets in 2019, 54% of 35 to 64 year olds used a streaming service to listen to music in the past month, representing an increase from 46% in 2018, which was the highest rate of growth for use of streaming services across all age groups.

Music permeates our culture across age groups, as evidenced by the footprint that music has across social media. According to a study conducted by visual capitalist in May 2021, 6 of the top 10 influencers across all social media platforms were musicians. As per the Recording Industry Association of America (RIAA), 9 out of 10 social media users do music related social media activity. This new monetization channel is showing great promise. According to YouTube, musicians owned the majority of videos that have achieved more than 1 billion lifetime views and/or have made it to the top 10 most watched videos of all time.

• Streaming Still in Early Stages of Global Adoption and Penetration

According to IFPI, global paid music streaming subscribers totalled 523 million at the end of 2021 and subscription revenue grew 21.9% to touch USD 12.3 billion. Subscription accounts have grown 18% over 2020 to 523 million, representing only 6.5% of the humans on this planet. In terms of smartphone users, it represents only 8.3% of the 6.3 billion smartphone users globally, as per the EMR The fast growing population of paying subscribers is still only a small fraction of the reported user bases of large, globally scaled digital services such as Facebook, which reported 2.93 billion monthly active users across its services as of March 2022, and YouTube, which has 2.6 billion unique monthly users according to Statista.

The United States, with a population of under 330 million, generated 1.15 trillion on-demand streams (both audio and video) in 2019, according to Nielsen; continued growth is to be expected. That indicates the potential size of Indias streaming market, even after assuming substantially lower realizations, when its population of 1.38 billion gets connected to the Internet.

The global music market derives 47.3% of revenues from paid subscriptions. In India, we expect to see advertisement-supported and subscription models co-exist. The evolution of Chinese markets over the past 7 years provides a firm basis for our belief that subscriptions will contribute substantial revenues in the near future.

According to IFPI, in 2013, China was ranked 21st in the world with total music industry revenues of approximately USD 82.6 million. The Indian music industry was much larger with revenues of USD 119.1 million at that time. Piracy in China was estimated to be over 95%. By the end of 2020, the Chinese market was ranked 6th in the world with revenues of USD 791.9 million. Subscription revenues in 2020 grew 55.8% over 2019.

• Pricing improvements

Internationally streaming subscription prices had remained flat for over a decade as players focused on penetration. Paid streaming is now entering a new phase as players have started raising prices. Spotify has recently raised subscription rates in 12 territories including US and UK. Other players are widely expected to follow suit. Amazon is experimenting by offering its Amazon Music HD at premium pricing in the US since 2019. Pricing improvements have aided paid streaming revenues to grow at 21.9% in 2021.

The Indian Governments crackdown on piracy from 2012 and changing attitudes of Indian consumers make it possible for the Indian music industry to follow a similar growth trajectory. The FICCI — EY Media & Entertainment Report 2022 expects paid subscribers for music streaming in India to cross 7 million by 2024.

As Indian OTT players inch closer towards public listing of their shares, they may opt to focus on subscription revenues. Bundling music with telecom services is also a viable option to reach a much wider but lower income audience.

• Technology Enables Innovation and Presents Additional Opportunities

Technological innovation has aided the penetration of music consumption across locations, including homes, offices and cars, as well as across devices, including smartphones, tablets, wearables, digital dashboards, gaming consoles, and smart speakers. These technologies represent advancements that are deepening listener engagement and driving further growth in music consumption by forming new listening habits. New technologies are likely to bring change in consumption patterns and provide new opportunities to engage with customers and increase penetration.

• Device Innovation

According to Nielsen, as of August 2019, U.S. consumers listened to music across an average of 4.1 devices per week. We believe that the use of multiple devices is expanding listening hours by bringing music into more moments of consumers lives; the different uses that these devices enable are also broadening consumers exposure to new and different genres of music. The music that consumers listen to during a commute may be different from the music they listen to while they exercise, and different still from the music they play through a smart speaker while cooking a meal. Smart speakers enable consumers to access music more readily by using their voices. According to PwC, smart speaker ownership is expected to increase at a 38% CAGR from 2018 through 2023, reaching 440 million devices globally in 2023. Smart speakers are fuelling further growth in streaming by converting more casual listeners into paid subscribers, drawn in by music as a critical application for these devices. According to Nielsen, 61% of

U.S. consumers who use a smart speaker weekly to listen to music currently pay for a subscription as well.

• Format and Monetization Model Innovation

Short-form music and music-based video content has grown rapidly, driven by the growth of global social video applications such as TikTok, which features 15-second videos often set to music. TikTok has reportedly been downloaded more than 3.3 billion times since its launch in 2017. TikTok has reported 1 billion monthly active users as of January 2022. Such applications have the potential for mass adoption, illustrating the opportunity for additional platforms of scale to be created to the benefit of the music and entertainment industry. Short-form music and music based videos have become popular on social media platforms like Facebook and Instagram too. It illustrates the growing number of pathways through which performing artistes and music labels may monetize their content. IMI reports that 19% of time spent on listening to music is on short form video apps, a close second to YouTube which accounts for 22% of such time.

The Media and Entertainment Industry in India continues to undergo a transformation. The rapid proliferation of mobile access is enabling on-demand, anytime-anywhere content consumption nationwide. For global players across the M&E value chain looking for a vibrant growth market, India provides an exciting opportunity to reach digitally empowered consumers. India ranks as one of the fastest growing app markets globally, a promising scenario for subscription-based and ad-supported music apps.

HUMAN RESOURCES

TIPS has always believed that its people are its most valuable assets. The Company ensures that all its employees enjoy a safe and healthy working environment. The Company has a strong emphasis on values based on integrity, excellence, and passion. We have always had a mutually respectful and appreciative relationship with all our employees.

As of March 31, 2022, the number of employees on the payroll of the Company was 49.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

The information on top 10 employees as required under Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in the Annexure forming part of the Report. In terms of the proviso to Section 136 (1) of the Act, the Report and Accounts are being sent to the shareholders excluding the aforesaid Annexure. The aforesaid Annexure is also available for inspection by Members at the Registered Office of the Company, 21 days before and up to the date of the ensuing Annual General Meeting during the business hours on working days.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies

(Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed to the Report as Annexure II.

WHISTLE-BLOWER POLICY / VIGIL MECHANISM POLICY

The Company has adopted a Whistle-Blower Policy/Vigil Mechanism Policy for Directors and employees to report their genuine concerns. Details of the policy are provided in the Corporate Governance Report, which forms part of this Annual Report.

RELATED PARTY TRANSACTIONS

All transactions with related parties were reviewed and approved by the Audit Committee and Board. The details of the related party transactions as per Ind AS 24 are set out in Notes to the Financial Statements forming part of this Report.

The Company has adopted a Related Party Transactions Policy. The policy, as approved by the Board, is uploaded on the Companys website.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Corporate Social Responsibility Committee is constituted in accordance with the provisions of Section 135 of the Companies Act

2013, read with rules made thereunder.

Pursuant to provision of Section 135 of the Companies Act 2013, read with the Companies (Corporate Social Responsibility Policy) Rules

2014, the Board has also framed a CSR Policy for the Company, on the recommendations of the CSR Committee, and the policy is available on the website of the Company at www.tips.in.

The Annual Report on CSR activities as required under Companies (Corporate Social Responsibility) Rules 2014, including a brief outline of the Companys CSR Policy, is annexed to this Report as Annexure III.

DEPOSITS

During the year under review, the Company neither accepted any deposits nor there were any amounts outstanding at the beginning of the year which were classified as Deposits in terms of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposit) Rules, 2014 and hence, the requirement for furnishing of details of deposits which are not in compliance with the Chapter V of the Companies Act, 2013 is not applicable.

PARTICULARS OF LOANS, GUARANTEES, OR INVESTMENTS BY COMPANY

The particulars of Loans, Guarantees, and Investments have been disclosed in the Financial Statements read together with Notes annexed to and forming an integral part of the Financial Statements.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013, the Annual Return of the Company as on March 31, 2022 is available on the website of the Company at www.tips.in in the investor section.

SECRETARIAL STANDARDS

The Company has complied with the Secretarial Standards issued by the Institute of Company Secretaries of India.

FRAUD REPORTING

During the year under review, no instances of fraud were reported by the Auditors of the Company.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, AND FOREIGN EXCHANGE EARNINGS AND OUTGO

• Conservation of energy

The particulars as required under the provisions of Section 134(3) (m) of the Companies Act 2013, read with rule 8 of the Companies (Accounts) Rules 2014, in respect of conservation of energy have not been provided, considering the nature of activities undertaken by the Company during the year under review.

• Technology absorption

During the year, the Company has not absorbed or imported any technologies.

• Foreign exchange earnings and outgoings

Details of foreign exchange earnings and outgoings of the Company made during the year are provided in Notes to the Financial Statement.

INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provisions of the Companies Act 2013, read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules 2016 ("The Rules"), the Company had sent individual notices and also advertised in the newspapers seeking action from the shareholders who have not claimed their dividends for past seven consecutive years i.e. for final dividend of the financial year ended 2013-2014, and thereafter, had transferred such unpaid or unclaimed dividends.

Unclaimed dividend for FY 2014-15 will fall due for transfer to the IEPF on September 19, 2022. Those Members who have not encashed their dividends for FY 2014-15 are requested to claim it from the RTA of the Company immediately. Those Members who have not so far claimed their dividend for the subsequent financial years are also advised to claim it from the Company or the RTA of the Company.

The Company has uploaded the details of the unpaid and unclaimed amounts lying with the Company on the website of the Company www. tips.in, and also on the website of the Ministry of Corporate Affairs www. mca.gov.in.

MATERIAL CHANGES

The Honble National Company Law Tribunal (NCLT), Mumbai Bench vides its order dated March 3, 2022 approved the Scheme of Arrangement and Demerger, which was filed with the office of the Registrar of Companies vide e-form INC 28 on March 23, 2022.

OTHER DISCLOSURES

• Except mentioned above, no material changes and commitments which could affect the Companys financial position have occurred between the end of the financial year of the Company and the date of this report.

• Except mentioned above, no significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companys operations in future.

• No complaint received from any employee, pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act 2013 and rules made thereunder.

CAUTIONARY STATEMENT

Statements in this Boards Report and Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations or predictions may be forward-looking within the meaning of applicable securities, laws, and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Companys operations include a change in government regulations, tax laws, economic and political developments within and outside the country and such other factors.

ACKNOWLEDGMENTS AND APPRECIATION

The Directors wish to acknowledge and place on record their sincere appreciation for the assistance and co-operation received from all the members, regulatory authorities, customers, financial institutions, bankers, lenders, vendors and other business associates.

The Directors also recognize and appreciate all the employees for their commitment, commendable efforts, teamwork, professionalism and continued contribution to the growth of the Company.

	For and on behalf of the Board of Directors
	Kumar S. Taurani
Place: Mumbai	Chairman and Managing Director
Date: May 30, 2022	(DIN: 00555831)