Dear Members,
The Directors hereby present this Integrated Annual Report of XTGlobal Infotech Limited (“The Company” or “XTGlobal”) on the business and operations of the Company along with the Audited Statement for the Financial Year ended 31st March 2024. The consolidated performance of the Company and its subsidiaries has been referred to wherever required. The report shall be available on https://xtglobal.com/investors/financial-information/ as a part of Annual Report.
FINANCIAL RESULTS
The Audited Financial Statements of your Company as on 31st March 2024, are prepared in accordance with the relevant applicable Ind AS and Regulation 33 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI Listing Regulations”) and the provisions of the Companies Act, 2013 (“Act”).
The summarized financial highlight is depicted below: in Lakhs
Standalone
Consolidated
In compliance with the provisions of the Companies Act, 2013 and the Indian Accounting Standards IND AS-10 and IND AS-28 on consolidated financial statements, your directors have provided the consolidated financial statements for the financial year ended March 31, 2024, which forms part of the Annual Report.
There are no material changes or commitments affecting the financial position of your Company which have occurred between the end of the financial year and the date of this report. Further, there has been no change in nature of business of your Company.
COMPANY'S FINANCIAL PERFORMANCE
On a standalone basis, the Company reported a revenue of 7,078.21 lacs for FY 2023-2024, reflecting a 6.98% increase over the previous year's revenue of 6,616.53 lacs in FY 2023. The Profit After Tax (PAT) attributable to shareholders and non-controlling interests stood at 793.74 lacs for FY 2023-2024, up from 744.78 lacs in FY 2023.
On a consolidated basis, the Company recorded a revenue of 21,713.40 lacs for FY 2023-2024, which represents a decrease of 10.26% compared to the previous year's revenue of 24,196.99 lacs. The Profit After Tax (PAT) attributable to shareholders and non-controlling interests was 1,167.35 lacs for FY 2023-2024, down from 1,246.33 lacs in FY 2022-2023.
Your directors express their heartfelt gratitude to all investors for being there with your Company on its growth journey.
DIVIDEND
Pursuant to section 123 of the Companies Act 2013 and rules made thereunder, the Board of Directors has approved issue of Interim dividend. In accordance with the Board's approval on November 14, 2023, your Company paid an interim dividend of 0.05/- per equity share of face value of 1 each to shareholders whose names appeared in the register of members as of November 24, 2023, the record date fixed for this purpose, after deduction of applicable taxes. The interim dividend declared on November 14, 2023, shall be the final dividend for the financial year 2023-24. This decision underscores our ongoing confidence in the company's performance and financial stability. Pursuant to section 124 of the Companies Act 2013, the unclaimed divided of Rs. 20,038.25 was transferred to a separate bank account.
TRANSFER TO RESERVES
The Board of Directors have decided to retain the entire amount of profit under Retained Earnings. Accordingly, yourCompany has not transferred any amount to General Reserves for the year ended 31st March 2024. The closing balance of the retained earnings of the Company for FY 2023-24 was Rs. 2704.13 Lacs.
REVISION OF FINANCIAL STATEMENTS
There was no revision of the financial statements for the year under review.
LISTING FEES
Your Company has paid the requisite Annual Listing Fees to BSE Limited (Scrip Code: 531225), where its securities are listed.
SHARE CAPITAL
During the Financial Year 2023 -24, there was no change either in its Authorised share capital or paid-up share capital. As on 31st March 2024 the Authorised Share Capital of the Company was 25,00,00,000/- divided into 25,00,00,000 Equity shares of 1/- each and issued, subscribed & paid-up share capital was 13,29,68,455 divided into 13,29,68,455Equity Shares of . 1/- each.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
The composition of the Board of Directors of the Company is in accordance with the provisions of Section 149 of the Act and Regulation 17 of the Listing Regulations, with an appropriate combination of Executive, Non-Executive and Independent Directors. As on March 31, 2024, the Board has 7 (Seven) Directors comprising of 1 (One) Managing Director, 1 (One) Whole-Time Director, 2 (Two) Non-Executive Directors and 3 (Three) Independent Directors. The complete list of Directors of the Company has been provided in the report on corporate governance forming part of this Report.
Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. Kusuluri Raghuram, Chief Financial Officer and Ms. Pentela Sridhar, Company Secretary and compliance officer were the Key Managerial Personnel of the Company during the year under review.
In accordance with the provisions of Section 152 of the Act, read with rules made thereunder and Articles of Association of the Company, Mr. Mullapudi Atchuta Ramarao (DIN: 02302179) is liable to retire by rotation at the ensuing Annual General Meeting (AGM) and being eligible offers himself for re-appointment. The Notice is the part of the report that includes a resolution that seeks shareholders' approval for the appointment Mr. Mullapudi Atchuta Ramarao (DIN: 02302179).
In accordance with the regulations outlined in Section 149 of the Act, the Independent Directors have submitted declarations confirming that each of them fulfills the criteria for independence as stipulated in Section 149(6) of the Act, as well as the associated Rules and Regulation 16(1)(b) of the SEBI Listing Regulations and there have been no alterations in the circumstances that might impact their standing as independent directors of the Company.
COMMITTEES OF THE BOARD
There are various Board constituted Committees as stipulated under the Act and Listing Regulations namely Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee and Corporate Social Responsibility Committee. During the year, all recommendations made by the committees were approved by the Board.
Brief details pertaining to composition, terms of reference, meetings held and attendance of these committees during the year have been enumerated in the Corporate Governance report, which forms part of this Integrated Annual Report.
DIRECTORS LIABLE FOR RETIRE BY ROTATION
Pursuant to the provisions of Section 152 of the Companies Act, 2013, Mr. Malireddy Jagannatha Prasad (DIN: 08835457) and Mr. Mullapudi Atchuta Ramarao(DIN: 02302179), Directors of the Company are liable to retires by rotation and out of these two directors Mr. Mullapudi Atchuta Ramarao(DIN: 02302179)is retiring by rotation being eligible, offers himself for reappointment. The Board recommended his re-appointment.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis, forming part of this report as required under Regulation 34 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 {hereinafter referred as SEBl (LODR) Regulations, 2015}, is attached separately to this Report as Annexure - C.
BOARD EVALUATION
Pursuant to provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluation of performance of Board of Directors, Committees and Individual directors.
The Board of Directors has carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Act and SEBI Listing Regulations.
The performance of the board was evaluated by the board after seeking inputs from all the directors on the basis of criteria such as the board composition and structure, effectiveness of board processes, information and functioning,including the contributions made at the Board meeting, attendance, instances of sharing best and next practices, domainknowledge, vision, strategy, engagement with senior management etc.
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The performance of the committees was evaluated by the board after seeking inputs from the committee members based on criteria such as the composition of committees, effectiveness of committee meetings, etc. The above criteria are based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India.
In a separate meeting of independent directors held on 29 March 2024 performance of non-independent directors, the board as a whole and the Chairman of the Company was evaluated, considering the views of executive directorsand non-executive directors. Performance evaluation of independent directors was done by the entire Board, excludingthe independent director being evaluated.
The Board and the Nomination and Remuneration Committee reviewed the performance of individual directors on the basis of criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. The details of the evaluation process are set out in the Corporate Governance Report, which forms a part of this Annual Report.
NUMBER OF MEETINGS OF THE BOARD
The Board met 7 (Seven) times in the financial year 2023-24. The details of the Board Meetings are given in the Corporate Governance Report. The gap between two meetings did not exceed one hundred and twenty days as provided under the Companies Act, 2013 and SEBI (LODR) Regulations, 2015.
INDEPENDENT DIRECTOR'S MEETING
The Independent Directors met on 29th March 2024, without the attendance of Non-Independent Directors and members of the management. The Independent Directors reviewed the performance of Non-Independent Directors, the Committees and the Board as a whole along with the performance of the Chairman of the Company, taking into account the views of Executive Directors and Non-Executive Directors and assessed the quality, quantity and timeliness of flow of information between the management and the Board that is necessary for the Board to effectively and reasonably perform their duties.
AUDIT COMMITTEE
The Audit Committee comprises of below mentioned directors as on 31st March 2024:
There are no recommendations of the audit committee which have not been accepted by the board during the yearunder review. Details of terms of reference for the Audit Committee and meetings of the Audit Committee held during the year under review have been given in the Corporate Governance Report. The details pertaining to the composition and attendance of the audit committee are included in the Corporate Governance Report, which is a part of this report.
NOMINATION AND REMUNERATION POLICY
The Board, on the recommendation of the Nomination & Remuneration Committee, framed a policy for selection and appointment of Director(s), Senior Management Personnel and their remuneration. The composition of the Nomination & Remuneration Committee was in compliance with the requirements of the provisions of Section 178 of the Companies Act, 2013 and of Regulation 19 of the SEBl (LODR) Regulations, 2015 except as mentioned in corporate governance report of the Company. The Nomination & Remuneration Committee comprises of below mentioned directors as on 31st March 2024:
DECLARATION BY INDEPENDENT DIRECTORS AND STATEMENT ON COMPLIANCE OF CODE OF CONDUCT
Pursuant to the provisions of Section 149 of the Act, the independent directors have submitted declarations st that each of them meets the criteria of independence as provided in Section 149(6) of the Act along with Rules framed thereunder and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI Listing Regulations”). There has been no change in the circumstances affecting their status as independent directors of the Company. None of the Independent Directors held any equity shares of your Company during the financial year ended 31 March 2024. None of the Directors had any relationships inter se.
The independent directors have also confirmed that they have complied with Schedule IV of the Act and the Company's Code of Conduct. In terms of Regulations 25(8) of the Listing Regulations, the Independent Directors have confirmed that they are not aware of any circumstance or situation, which exists or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgement and without any external influence. Your Company has in place a Code of Conduct for the Board of Directors and Senior Management Personnel, which reflects the legal and ethical values to which your Company is strongly committed. The Directors and Senior Management Personnel of your Company have complied with the code mentioned hereinabove.
FAMILIARISATION PROGRAMME
These Programs aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarization of Independent Directors with the Company are available on the Company's website at www.xtglobal.com.
The Board members are also regularly updated on changes in Corporate and Allied laws, Taxation laws and related matters through presentations and updates made by the respective functional leaders. MD & WTD along with Senior leadership conducts quarterly sessions with board members sharing updates about the Company's business strategy, operations, and the key trends in the IT industry relevant for the Company. These updates help the board members to get abreast of the key changes and their impact on the Company.
BOARD POLICIES
The details of various policies approved and adopted by the Board as required under the Companies Act, 2013 and SEBI Listing Regulations are updated on the website of the Company and can be accessed at https://xtglobal.com/investors/corporate-governance-and-policies/ .
EMPLOYEE STOCK BENEFIT SCHEME
Pursuant to the approval accorded by members at their Annual General Meeting held on 30th September 2020, the Nomination & Remuneration Committee of the Company formulated an employee benefit scheme “XTGlobal Infotech Limited Employees Stock Benefit Scheme 2020” (“Scheme”) in accordance with the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014. The Scheme ESBS is applicable to all permanent and fulltime employees of the Company and its Subsidiary Company whether working in India or out of India, and to the Directors whether a Whole time Director or not but, excluding Independent Director, Non-Executive Directors of the Company and its Subsidiary Company(ies) and also excluding Promoter or a person belonging to the Promoter Group;or a Director who either himself or through his Relative or through any Body Corporate, directly or indirectly, holds more than ten percent of the outstanding Equity Shares of the Company.
The eligibility of employees to receive grants under the Scheme has to be decided by the Nomination & RemunerationCommittee (NRC) from time to time at its sole discretion. Vesting of the Options/RSUs shall take place in the manner determined by NRC at the time of grant and such other conditions as provided under the Scheme. The Exercise Price of each grant is determined by the NRC based on the market price at the time of the Grant.
Disclosure as per Indian Accounting Standard 102 Share Based Payment issues by ICAI
The Company has ‘Nil' Share Based Payment arrangements during the year ended 31st March 2024. The estimated fair value of each stock option granted in the general employee stock benefit scheme ranges from 28.41/- to Rs. 33.44/- depending upon the vesting date. Expenses arising from the employee stock benefit scheme is Rs. 118 Lakhs for the reporting period.
Diluted EPS on issue of shares pursuant to all the schemes covered under the regulations shall be disclosed in accordance with 'Accounting Standard 20 - Earnings Per Share' issued by ICAI or any other relevant accounting standards as prescribed from time to time No ESOP's issued during the period therefore there are no potential equity shares. Thus, basic EPS and Diluted EPS are the same.
Details related to Scheme
A description of each ESOPs that existed at any time during the year, including the general terms and conditions of each ESOPs:
Where the company opts for expensing of the options using the intrinsic value of the options, the difference between the employee compensation cost so computed and the employee compensation cost that shall have been recognizedif it had used the fair value of the options shall be disclosed. The impact of this difference on profits and on EPS of the company shall also be disclosed Not Applicable, as the Company is using the Fair Value Method.
Option movement during the year:
Weighted-average exercise prices: Exercise of options was not executed during the year under review. weighted- average fair values: Nil
Employee wise details (name of employee, designation, number of options granted during the year, exercise price) of options granted to Senior managerial personnel. Any other employee who receives a grant in any one year of option amounting to 5% or more of option granted during that year; and Identified employees who were granted options, during any one year, equal to or exceeding 1% of the issued capital(excluding outstanding warrants and conversions) of the Company at the time of grant. Nil
The board has delegated its power to NRC to decide criteria for selection of Employees, however, during the year underreview, NRC has not granted any Options/RSU under the Scheme.
A description of the method and significant assumptions used during the year to estimate the fair value of options The fair value of the options has been calculated using the Black Scholes model considering the factors like share price, exercise price, expected volatility, option life, expected dividend and the risk-free interest rate. Expected volatility has been calculated based on the 1-year historical market price of the shares of the company.
Scheme Compliance status
XTGlobal Infotech Limited Employees Stock Benefit Scheme 2020 is in compliance with Securities and ExchangeBoard of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and the Companies Act, 2013. The Company has received a certificate from the Statutory Auditors of the Company certifying that ESBS- 2020 is being implemented in accordance with the SEBI Regulations and is in accordance with the resolution passed by the Membersof the Company at the Annual General Meeting.
Administration of the Scheme
The Nomination & Remuneration Committee of the Board administers the Employee Stock Benefit Schemes as formulated by the Company.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act, 2013 the Board of Directors of your Company, to the best of their knowledge, belief and ability and explanations obtained by them, confirm that: in the preparation of the annual financial statements, for the financial year ended 31st March 2024, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any;
the accounting policies had been selected and applied 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 at the financial year ended 31st March 2024 and of the profit of the Company for that period;
proper and sufficient care had been taken 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;
the annual accounts had been prepared on a going concern basis;
internal financial controls, to be followed by the Company, had been laid down and these controls are adequate and were operating effectively; and The directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered with your Company, during the financial year were on arm's length basis and were in the ordinary course of the business and in accordance with the provisions of the Act and the rules made thereunder, the SEBI Listing Regulations and your Company's Policy on Related Party Transactions.
All Related Party Transactions were placed before the Audit Committee and the Board of Directors, pursuant to applicable provisions of SEBI (LODR) Regulations, 2015 & Companies Act, 2013. Prior omnibus approval of the Audit Committee has been obtained for the transactions which were repetitive in nature. The transactions entered pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors. The policy on Related Party Transactions, as approved by the Board, is available at the Company's website.
No Contract or Agreement was executed between the Company and any of the Related Party which was not at arms- length price during the period under review. The particulars of related party transactions in prescribed Form AOC - 2 are attached as “Annexure-A.”
CORPORATE SOCIAL RESPONSIBILITY
XTGlobal's CSR initiatives and activities are aligned to the requirements of Section 135 of the Act. The brief details of the CSR Committee are provided in the Corporate Governance Report, which forms part of this Integrated Annual Report. The CSR Policy and CSR Plan is available on the website of your Company at: https://xtglobal.com/investors/corporate-governance-and-policies/ A brief outline of the CSR policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in “Annexure E” of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. Further, the Chief Financial Officer of your Company has certified that CSR spends of your Company for FY 2023- 24 have been utilized for the purpose and in the manner approved by the Board.
RISK MANAGEMENT
The Company has developed and implemented a risk management policy which identifies major risks which may threaten the existence of the Company. The same has also been adopted by your Board and is also subject to its review from time to time. Risk mitigation process and measures have been also formulated and clearly spelled out in the said policy. Formulation of Risk Committee is not applicable to the Company as per the applicable provisions. The elements of risk as identified for the Company with impact and mitigation strategy are set out in the Management Discussion and Analysis Report.
AUDITORS Statutory Auditors:
The members, at Thirty Third Annual General Meeting of the Company held on 29th September, 2021 had accorded their approval pursuant to provisions of Sections 139 and other applicable provisions of the Companies Act, 2013 and Rules made there under to appoint M/s. C. Ramachandram & Co., Chartered Accountants (Registration No. 002864S) as the Statutory Auditor of the Company for a period of five years from the conclusion of 33rd AGM till the conclusion of 38th Annual General Meeting on such remuneration as may be determined by the Board of Directors.
The Statutory Auditors have confirmed that they satisfy the criteria of independence, as required under the provisions of the Companies Act, 2013. There is no qualification, reservation or adverse remark or disclaimer in the Auditors' Report notes to the accounts are self-explanatory, needs no further clarification or explanation. There are no frauds in or by your Company, which are required to be reported by the Statutory Auditors of your Company. Representative of the Statutory Auditors of your Company attended the previous AGM of your Company held on 29th September 2023.
Secretarial Auditor:
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Regulation 24A of SEBI Listing Regulations, M/s. VCSR & Associates, Practicing Company Secretaries were appointed as Secretarial Auditor, to undertake the secretarial audit of your Company for FY23-24. The report of the Secretarial Auditor, in the prescribed Form MR-3 is annexed to this report as “Annexure-B”. The Secretarial Auditors' Report for FY23-24 does not contain any qualification, reservation or adverse remark in the form MR-3 which is annexed to this report.
Internal Auditor:
Pursuant to provisions of Section 138 read with Rule 13 of the Companies (Accounts) Rules, 2014 and Section 179 readwith Rule 8(4) of the Companies (Meetings of Board and its Powers) Rules, 2014 the Company has appointed M/s. T Mohan & Associates, Chartered Accountants, Hyderabad as Internal Auditors forthe Financial Year 2023-24.
Summary of Significant Audit Observations along with recommendations and its implementations are reviewed by the Audit Committee and concerns, if any, are reported to Board. There were no adverse remarks or qualifications on accounts of the Company from the Internal Auditor.
INTEGRATED REPORT
The Company has voluntarily provided the Integrated Report, which encompasses both financial and non-financial information, to enable the Members to take well-informed decisions and have a better understanding of the Company's long-term perspective. The Report also touches upon aspects such as organization's strategy, governance framework,performance and prospects of value creation based on the five forms of capital viz. financial capital, intellectual capital,human capital, social capital and natural capital.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO Conservation of Energy, Technology Absorption
The Company is committed towards conservation of energy and climate action towards Environmental Sustainability. The details as required under the provisions of Section 134(3) (m) of the Companies Act, 2013 in respect of conservation of energy and technology absorption the Company continues to adopt and use the latest technologies to improve the productivity and quality of its services and products. The Company's operations do not require significant import of technology. Your Company has also taken steps for a conversation of Energy at the Office. Initiatives in new premises of vizag office infrastructure included higher energy efficiencies in heating, ventilation, and air conditioning (HVAC) systems, uninterruptible power supply, use of LEDs.
Foreign Exchange Earnings and Outgo
Earning: Rs. 6735.47 Lakhs Outgo: Rs 590.97 Lakhs
ANNUAL RETURN
Pursuant to the requirement under Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013, the Annual return as on 31st March, 2024 is available on Company's website and the copy of the annual return can be accessed at https://xtglobal.com/investors/shareholders-information/ .
INTERNAL FINANCIAL CONTROL
The Company has internal financial controls which are adequate and operate effectively. The controls are adequate for ensuring the orderly & efficient conduct of the business, including adherence to the Company's policies, the safeguarding of assets, the prevention & detection of frauds & errors, the accuracy & completeness of accounting records and timely preparation of reliable financial information. The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness, inefficiency or inadequacy in the design or operation was observed.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
During the reporting period, no loans, investments, guarantees, or security were executed by the Company in respect of provisions of section 185 of the Companies Act, 2013. Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are as set out in the notes to the accompanying financial statements of your Company.
SUBSIDIARY & ASSOCIATE COMPANY & JOINT VENTURES
Your Company has one foreign subsidiary i.e. XTGlobal Inc. (USA) wholly owned subsidiary. Along with that XTGlobal is having one associate company i.e. Network Objects Inc. with a 44.33% holding. During the financial year, your Board of Directors had reviewed the affairs of the subsidiaries. The consolidated financial statements of your Company are prepared in accordance with Section 129(3) of the Companies Act, 2013; and forms part of this Annual Report. Pursuant to the provisions of Section 129(3) of the Act, a statement containing the salient features of financial statements of the Company's subsidiaries in Form AOC-1 is attached to the financial statements of the Company. Pursuant to the provisions of Section 136 of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited financial statements in respect of subsidiaries, are available on the website of the Company www.xtglobal.com. Further, the Company does not have any joint venture during the year or at any time after the closure of the year and till the date of the report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company's Policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records, and the timely preparation of financial disclosures. The Company has an internal Control System commensurate with the size, scale and complexity of its operations. These are routinely tested and certified by Statutory as well as Internal Auditor. Significant audit observations and corrective action are reported to the Audit Committee. The concerned executives monitor and evaluate the efficacy and adequacy of the internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
Pursuant to Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 read with Section 177(10) of the Companies Act, 2013 (“Act”) and Regulations 22 of the Listing Regulations your Company has adopted a Vigil
Mechanism Framework (“Framework”), under your Company has formulated a mechanism called “Vigil Mechanism/ Whistle Blower Policy” for directors and employees to report to the management instances of unethical behavior, actual or suspected fraud or violation of the Company's Code of Conduct and provided a framework to protect employees wishing to raise a concern about serious irregularities within the Company. The policy permits all the directors and employees to report their concerns to the Competent Authority, Chairman/Managing Director of the Company and if the Whistle Blower believes that there is a conflict of interest between the Competent Authority and the Whistle Blower, he/she may send his/her protected disclosure directly to the Chairman of the Audit Committee. The policy with the designation and address of the Competent Authority, Chairman/Managing Director of the Company and Chairman of the Audit Committee has been communicated to the employees by uploading the same on the website of the Company. The Whistle Blower Policy is made available on the website of the Company.
PREVENTION OF SEXUAL HARASSMENT POLICY
Your Company laid down Prevention of Sexual Harassment policy and it is made available on the website of the Company. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Company has duly constituted Internal Complaints Committee for redressal of sexual harassment matters under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The said Policy is uploaded on the website of the Company at: https://xtglobal.com/investors/corporate-governance- and-policies/
INTERNAL COMPLAINTS COMMITTEE:
All employees (permanent, contractual, temporary and trainees) are covered under this policy. Following are the details of the complaints received by your Company during FY 2023-24:
DEPOSITS FROM PUBLIC
The Company has not accepted any deposits from the public and as such, no amount on account of principal or interest on deposits from the public was outstanding as on the date of the balance sheet. There were no outstanding depositswithin the meaning of Section 73 and 74 of the Act read with rules made thereunder at the end of FY 2023-24. Since the Company has not accepted any deposits during the Financial Year ended March 31, 2024, there are no instances of non-compliance with the requirement of the Act.
INSURANCE
Your Company's Assets have been adequately insured.
CORPORATE GOVERNANCE
Your Company is committed to good corporate governance practices. The Corporate Governance Report as stipulatedby SEBI Listing Regulations, forms part of this Integrated Annual Report along with the required certificate from aPracticing Company Secretary regarding compliance of the conditions of Corporate Governance as stipulated. Your Company has been particular in implementing and complying with the norms of Corporate Governance and complying all the mandatory requirements as specified in Regulations 17 to 27, clause (b) to (i) of sub-regulation (2)of Regulation 46 and paragraph C, D and E of Schedule V of the SEBI (LODR) Regulations, 2015. A detailed report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate of compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached separately to this Reportas Annexure - D.
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The Nomination & Remuneration Committee of the Company formulates the criteria for determining the qualifications, positive attributes and independence of Directors in terms of its charter. In evaluating the suitability of individual Board members, the Committee takes into account factors such as educational and professional background, general understanding of the Company's business dynamics, standing in the profession, personal and professional ethics, integrity and values, willingness to devote sufficient time and energy in carrying out their duties and responsibilities effectively.
The Committee also assesses the independence of Directors at the time of their appointment / re-appointment as per the criteria prescribed under the provisions of the Act and the rules made thereunder and the Listing Regulations. The Remuneration Policy for Directors, Key Managerial Personnel and other employees is provided in the Corporate Governance Report forming part of this Report.
PARTICULARS OF EMPLOYEES AND MANAGERIAL REMUNERATION
In terms of the provisions of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:
The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year:
*No remuneration other than sitting fee is paid to Non-executive Independent Director of the company.
The percentage increase in remuneration of each director, chief executive officer, chief financial officer, company secretary in the financial year:
The percentage increase in the median remuneration of employees in the financial year 2023-24: 1.52 times The number of permanent employees on the rolls of Company (As on 31st March 2024): 500 Employees (Male - 313 & Female - 187) Average percentage increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration: The average annual increase was around 26.2% for personnel other than managerial personnel. No managerial remuneration was paid for the financial year 2023-24 except remuneration paid to Mrs. Vuppuluri Sreedevi.
Affirmation that the remuneration is as per the remuneration policy of the Company.
The Company affirms that the remuneration is as per the remuneration policy of the Company. There are no employees drawing remuneration in excess of the limits set out in Rule 5 (2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.
There are no employees drawing remuneration in excess of the limits set out in Rule 5 (2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.
If employed throughout the financial year or part thereof, was in receipt of remuneration in that year which, in the aggregate or as the case may be, at a rate which, in the aggregate, is in excess of that drawn by the managing director or whole-time director or manager and holds by himself or along with his spouse and dependent children, not less than two percent of the equity shares of the Company- None
OBSERVANCE OF THE SECRETARIAL STANDARDS ISSUED BY THE INSTITUTE OF COMPANY SECRETARIES OF INDIA
Your Company is in compliance with the applicable Secretarial Standards, issued by the Institute of Company Secretaries of India and approved by the Central Government under Section 118(10) of the Act. The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.
MATERIAL CHANGES AND COMMITMENTS
There were no material changes and commitments affecting the financial position of your Company between the end of FY 2023-24 and the date of this report, which could have an impact on your Company's operation in the future orits status as a “Going Concern”. No significant and material order has been passed by the regulators, courts, tribunals impacting the going concernstatus from April 2022 to March 2024.
HUMAN RESOURCE DEVELOPMENT
Your company continues to enjoy cordial relationship with its personnel at all levels and focusing on attracting and retaining competent personnel and providing a holistic environment where they get opportunities to grow and realize their full potential. Your company is committed to providing all its employees with a healthy and safe work environment; therefore, Company has provided work from home facility to its maximum employees to prevent employees and their families from viral infections. Your company is organizing training programs wherever required for the employees concerned to improve their skill. Employees are also encouraged to participate in the webinars organized by the external agencies related to the areas oftheir operations.
MAINTAINANCE OF COST RECORDS
The maintenance of cost records under sub-section (1) of section 148 of the Act, not applicable to the company.
INSIDER TRADING REGULATIONS
Your Company is compliant Pursuant to the provisions of SEBI (Prohibition of Insider Trading) Regulations, 2015 (as amended from time to time), the Company has formulated a Code of Conduct on Prohibition of Insider Trading (‘Insider Trading Code'). The Insider Trading Policy of the Company lays down guidelines and procedures to be followed, and disclosures to be made while dealing with shares of the Company, as well as the consequences of violation. The policyhas been formulated to regulate, monitor and ensure reporting of deals by employees and to maintain the highest ethical standards of dealing in Company securities.
CFO CERTIFICATION
As required under Regulation 17(8) of the SEBI Listing Regulations, the CFO of your Company have certified the accuracy of the Financial Statements, the Cash Flow Statement and adequacy of Internal Control Systems for financial reporting for the financial year ended 31st March 2024. Their Certificate is annexed to this Directors' Report.
GENERAL DISCLOSURE
Your directors state that no disclosure or reporting is required in respect of the following items as there were no transactions/events of these nature during the year under review: Issue of equity shares with differential rights as to dividend, voting or otherwise, Issue of Shares (Including ESOP) to employees of your Company under any scheme, Signi cant or material orders passed by the Regulators or Courts or Tribunals which impact the going concernstatus and your Company's operation in future, Change in the nature of business of your Company, Application was made or any proceeding is pending under the Insolvency and Bankruptcy Code, 2016, One time settlement of loan obtained from the Banks or Financial Institutions, Revision of financial statements and Directors' Report of your Company
ACKNOWLEDGEMENT
The Board of Directors take this opportunity to express their gratitude to the Central Government, State Government and Local Authorities, Financial Institutions, Banks, Customers, Dealers, Vendors and all the stakeholders for their continued cooperation and support to your Company. The Board of Directors wishes to express its appreciation to all the employees of the Company for their contribution to the growth of the Company. The Directors appreciate and value the contribution made by every member of the XTGlobal Family. The Board especially thank to the shareholders for their continued confidence and faith in the Company.
For and on behalf of Board of Directors of For XTGlobal Infotech Limited