DEAR MEMBERS,
Your Directors present their Report together with the audited financial statements for the year ended March 31, 2024.
FINANCIAL PERFORMANCE/SUMMARY (Rupees in Crores)
REVIEW OF OPERATIONS / STATE OF COMPANY'S AFFAIRS FOR THE FY 2023 - 24
The Company primarily operates in the software development. Our Company is a global business & technology services company. Our technology services help businesses to establish a critical foundation for digital and AI transformation through strategic workshops and assessments, ready-to-deploy solutions, R & D implementation cycles. For over 20 years, we have been helping businesses use solutions for Artificial Intelligence, Machine Learning and cloud solutions. Our expertise in a wide range of domains and industries, help businesses unlock value to stay ahead and relevant in a changing world. Application Services - As an end-to-end service provider, we help clients design, build and deploy robust applications that help unlock the true potential of your business with an AI-led approach. We enable navigate legacy or SaaS applications' complexities to drive measurable performance and growth with an agile methodology and innovation at the core of your application lifecycle. We help create custom apps that drive personalization, engagement, user experiences and increase time-to-market. Infrastructure and Cloud Services - Fast track digital transformation and migration with services that cover the entire IT infrastructure stack with AI and automation. Modernize client IT infrastructure by designing, managing, migrating, and monitoring them better with the agile and DevOps processes. Get complete compliance and governance support for accurate infrastructure and cloud deployment across all environments, embedding best practices and business continuity. Make client's cloud accessible, scalable, agile, efficient, reliable, secure, and flexible with 24/7 global cloud management services, including private or public cloud like AWS, Google, or Microsoft Azure. AI and Data - We help businesses simplify, modernize, and automate processes with machine learning and data-backed personalization that embed business intelligence with AI. We help imbibe transparency, visibility, and value with an AI-first approach through AIaaS models across various consumption models and hybrid multi-cloud architectures. With pre-built and pre-integrated AI solutions and ML models, we enable businesses to build, deploy, configure solutions faster, improve process automation, detect anomalies, and get data-driven insights.
There has been no change in the business of the Company during the financial year ended March 31, 2024. Please refer our website www.ctepl.com for details on business.
During the financial year under review, your Company's revenue increased by 21.02% on standalone basis. On standalone basis, revenue from operations of your company for the financial year ended March 31, 2024 is Rupees 76.32 crores ("cr") as compared to Rupees 63.06 cr for the financial year ended March 31, 2023. Profit After Tax decreased by 2.25% to Rupees 3.48 cr for the year ended 31st March, 2024 as compared to Rupees 3.56 cr for the same period last year. Total comprehensive income decreased by 2.65% to Rupees 3.31 crores for the year ended 31st March, 2024 as compared to Rupees 3.40 cr for the same period last year. Reserves and Surplus have increased by 12.17% from Rupees 26.30 cr in FY 2022-23 to Rupees 29.50 cr in FY 2023-24.
Further, on consolidated basis, total revenue from operations of your company increased by 13.32% to Rupees 206.23 crores ("cr") for the year ended 31st March, 2024 as compared to the previous year's total revenue of Rupees 181.99 cr. Profit After Tax decreased by 31.45% to Rupees 5.58 cr for the year ended 31st March, 2024 as compared to Rupees 8.14 cr for the same period last year. Total comprehensive income also decreased by 32.23%to Rupees 7.97 cr for the year ended 31st March, 2024 as compared to Rupees 11.76 cr for the same period last year. Reserves and Surplus have increased by 17.28% from Rupees 79.15 cr in FY 2022-23 to Rupees 92.83 cr in FY 2023-24.
The Company has adopted Ind AS from 1st April, 2017. The audited financial statements (both standalone and consolidated) prepared in accordance with Section 129 and Section 133 of the Companies Act, 2013 read with the rules made thereunder ("the Act") and applicable Indian Accounting Standards (Ind AS) along with the Auditor's Report that forms part of this Annual Report.
As required under Section 136 of the Companies Act, 2013, audited financial statements including the consolidated financial statements and all other documents required to be attached thereto and audited or unaudited accounts, as the case may be, of each of its subsidiaries whose accounts are consolidated are available on the website of the company i.e., www.ctepl.com. These documents will also be available for inspection during the business hours at the registered office of the Company.
REPORT ON SUBSIDIARIES/JOINT VENTURE
As on March 31, 2024, the Company has six wholly owned subsidiaries viz., CTE Web Apps Private Limited, India, Cambridge Technology Inc., USA, Cambridge Technology Investments Pte. Ltd., Singapore; FA Software Services Private Limited, India, R.P. Web Apps Private Limited, Appshark Software, Inc., USA., and 4 step-down subsidiaries viz., M/s Cambridge Innovation Capital LLC, USA, M/s Cambridge Biz Serve Inc., Philippines, M/s CT Asia SDN. BHD., Malaysia (formerly known as CT Software Solutions SDN. BHD., Malaysia and Cambridge Technology Financial Services Inc, USA.
The Company incorporated a wholly owned subsidiary under the name "N2T1 AI Solutions Private Limited" on April 21, 2024 with initial paid-up capital of Rupees 100,000/-, divided into 10,000 Equity shares of face value of Rupees 10/- each.
Names of companies which have become Subsidiaries, joint ventures or associate companies during the financial year 2023-24:
The following companies have become Subsidiaries during the financial year 2023-24:
FA Software Services Private Limited, RP Web Apps Private Limited and Appshark Software Inc.
1. The Company has completed acquisition of 80% of voting rights/equity shares of FA Software Services Private Limited during the period ended March 31, 2023. The Company further completed the acquisition of remaining 20% of the shares as on March 15, 2024, the cost of acquisition for remaining 20% being INR 150,000. Accordingly, the Company has completed 100% acquisition of FA Software Services Private Limited and the same has become the Wholly Owned Subsidiary of the Company w.e.f March 15, 2024.
2. The company has completed acquisition of 100% of shares/voting rights of Appshark Software, Inc on January 23, 2024. The cost of acquisition or the price at which the shares are acquired is USD 4.98 million (INR 42.16 Crores). Appshark Software, Inc is 100% wholly owned subsidiary of the Company w.e.f January 23, 2024.
3. The Company has completed acquisition of 100% of shares/voting rights of RPWAPL as on July 31, 2023. The cost of acquisition or the price at which the shares are acquired is INR 2.98 crores. R.P. Web Apps Private Limited is 100% wholly owned subsidiary of the Company w.e.f July 31, 2023.
Names of companies which have ceased to be Subsidiaries, joint ventures or associate companies during the financial year 2023-24: Not Applicable
The Company does not have any joint venture or associate companies as on March 31, 2024.
Highlights of Performance of Subsidiaries and their contribution to the overall performance of the company during the period under report
• FA Software Services Private Limited, which became a subsidiary of the Company w.e.f March 20, 2023 had net revenue of Rupees 7.96 cr during the period under review. The net loss after tax is Rupees 8.11 cr in FY 2023-24.
• Cambridge Technology Inc., USA, had net revenue of Rupees 175.49cr during the financial year 2023-24 as compared to Rupees 149.26 cr during the previous financial year. The net profit after tax is Rupees 13.45 cr in FY 2023-24 as compared to Rupees 1.87 cr in FY 2022-23. The contribution of Cambridge Technology Inc., USA to the overall performance of the company is in the form of revenue, earned by the company by rendering its services amounting to Rupees 67.39 cr.
• Cambridge Innovation Capital LLC, USA, a step - down subsidiary company had no revenue during FY 2023-24 as compared to 8.47 cr revenue during the previous financial year. The net loss after tax is Rupees 2.87 cr in FY 2023-24 as compared to Rupees 1.83 cr in FY 2022-23.
• Cambridge Technology Investments Pte. Ltd, Singapore has nil revenue and net loss of Rupees 0.16 lakhs during the year as compared to Rupees 4.45 cr revenue and net profit of Rupees 22.73 lakhs during the previous financial year.
• Cambridge Biz Serve Inc., Philippines has net revenue of Rupees 1.06 cr as on March 31, 2024 and net loss of Rupees 0.39 cr as compared to net revenue of Rupees 2.51 cr and net profit of Rupees 1.65 cr during the previous financial year.
• CT Asia SDN. BHD. (formerly known as CT Software Solutions SDN. BHD.) had net revenue of Rupees 6.13 lakhs and net profit of Rupees 6.01 lakhs as on March 31, 2024 when compared to Rupees 6.98 cr and net profit of Rupees 1.06 cr during the previous financial year.
• CTE Web Apps Private Limited has net revenue of Rupees 9.88 cr and net profit after tax is Rupees 0.24 cr during financial year 2023-24. It did not commence operations during previous financial year.
• R. P. Web Apps Private Limited which became a subsidiary of the Company w.e.f July 31, 2023 had net revenue of Rupees 4.44 cr and net profit after tax is Rupees 7.65 lakhs during the period under review.
• Appshark Software, Inc which became a subsidiary of the Company w.e.f January 23, 2024 and had net revenue of Rupees 6.99 cr and net loss after tax of Rupees 1.44 cr in during the period under review.
• CT Financial services Inc a step - down subsidiary company had net revenue of Rupees 1.30 cr and net profit after tax of Rupees 84.13 lakhs during the period under review.
Except for as stated above, there is no material contribution to the overall performance of the company during the financial year 2023-24.
Further, as per provisions of section 129(3) of the Companies Act, 2013, a statement containing the salient features of financial statement of our subsidiaries i.e., a report on the financial
performance and financial position of each of the Subsidiaries included in the Consolidated Financial Statements is provided in the prescribed format AOC-1 appended as Annexure - 1 to the Board's Report and forms part of this Annual Report.
TRANSFER TO RESERVES
The Board of Directors did not propose to transfer any amount to reserves for the period under review.
DIVIDEND
Keeping in view the expected cash flow requirements and in order to conserve the resources for future business operations, expansion and for the future growth of the Company, the Board of Directors were not able to recommend any dividend for the financial year ended 31st March, 2024.
CAPITAL STRUCTURE
During the year, the authorized share capital and paid up capital of the Company remained unchanged at Rupees 300,000,000/- divided into 30,000,000 equity shares of Rupees 10/- each & Rupees 196,310,150/- divided into 196,310,15 equity shares of Rupees 10/- each respectively.
DIRECTORS
The Board of Directors of your Company comprises of 6 (Six) Directors as on the date of this report representing the optimum blend of professionalism, knowledge and having varied experience in different disciplines of corporate functioning. Of these, 4 (Four) are Independent Directors, 1 (one) Whole-Time Director and 1 (one) Non-Executive Director.
Appointments / Re-appointments
The Shareholders, based on the recommendation of Board of Directors, by way of Postal Ballot (April 13, 2023, being the last date for remote e-voting w.r.t Postal Ballot) have approved appointment of:
1. Mr. Chirravuri Subrahmanya Leeladhar as Whole-Time Director (designated as Executive Director and Chief Financial Officer) of the Company for a period of 5 (five) years with effect from January 14, 2023.
2. Mr. Srinivas Medepalli as an Independent Director of the Company for a period of five consecutive years with effect from March 08, 2023.
Also, Shareholders, based on the recommendation of Board of Directors, in Annual General Meeting held on September 27, 2023 have approved re-appointment of:
1. Mr. Dharani Raghurama Swaroop (DIN: 00453250) as Whole-time Director of the for a further period of 5 years, w.e.f. March 01, 2024.
Pursuant to provisions of Section 152 of the Companies Act, 2013 read with the Companies (Appointment and Qualification of Directors) Rules, 2014, Mr. Dharani Raghurama Swaroop (DIN: 00453250) is liable to retire by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment to the office of directorship. The Directors propose the reappointment of Mr. Dharani Raghurama Swaroop for approval of the shareholders at the ensuing Annual General Meeting (AGM) of the Company.
A Brief profile of Mr. Dharani Raghurama Swaroop along with the nature of his expertise and the number of companies in which he holds directorship and membership / chairmanship of
committees of the Board and other requisite details, as stipulated under Companies Act, 2013, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations" or "SEBI (LODR) Regulations, 2015") and Secretarial Standard 2 as issued by the Institute of Company Secretaries of India is given below and/or annexed to the notice of the Annual General Meeting.
Resignation(s)/Vacation of Office
1. Pursuant to Section 167 of the Companies Act, 2013, the office of the Director shall become vacant in case a Director absents himself from all the meetings of the Board of Directors held during a period of twelve months with or without seeking leave of absence of the Board. Accordingly, as Mr. Amudala Sreeramulu Nageswar Rao did not attend the meetings of the Board of Directors held during a period of twelve months, he ceased to be Director w.e.f November 10, 2023.
2. Mr. Chirravuri Subrahmanya Leeladhar, Executive Director & Chief Financial Officer of the Company has tendered his resignation vide his resignation letter dated November 08, 2023 from all his positions in the Company with effect from close of business hours of November 10, 2023 owing to personal issues, and hence, he ceased to be the Executive Director & Chief Financial Officer of the Company w.e.f said date.
KEY MANAGERIAL PERSONNEL
As on date of this report, the following are Key Managerial Personnel of the Company:
Appointments / Resignations
All appointments/ re-appointments of Directors are made in accordance with the relevant provisions of the Act and the rules framed thereunder, the SEBI Listing Regulations, and the rules, guidelines and circulars issued by the Ministry of Corporate Affairs therein.
The Nomination and Remuneration Committee of the Board ('NRC') conducts due diligence before appointment of Directors and ensures adherence to Regulatory Requirements, Fit and Proper Criteria & Board Diversity.
Changes in the Key Managerial Personnel of the Company during the Financial Year 2023-24, are as follows:
1. Mr. Dharani Raghurama Swaroop (DIN: 00453250) Whole-time Director of the Company, was reappointed for a further period of 5 years, w.e.f. March 01, 2024. The said reappointment was approved by the shareholders of the Company at the 24th AGM held on September 27, 2023.
2. Mr. Chirravuri Subrahmanya Leeladhar (DIN: 01643014), Chief Financial Officer of the Company who was designated as Executive Director and Chief Financial Officer of the Company has resigned from all his positions in the Company with effect from close of business hours of November 10, 2023 owing to personal issues, and hence, he ceased to be the Executive Director & Chief Financial Officer of the Company w.e.f said date.
3. Mr. Purnayya Puppala, a qualified Chartered Accountant, Cost & Management Accountant, and Certified IFRS was appointed as the Chief Financial Officer of the Company w.e.f. November 10, 2023.
4. Mr. G.V.S. Ravi Kumar was appointed as Company Secretary & Compliance Officer of the Company w.e.f. November 10, 2023. However, Mr. Ravi Kumar tendered his resignation vide his resignation letter dated February 12, 2024 from all his positions in the Company with effect from close of business hours of February 29, 2024 owing to his personal commitments and pursuits and hence, he ceased to be the Company Secretary & Compliance Officer of the Company w.e.f said date.
5. Mr. Ashish Bhattad, Company Secretary & Compliance Officer of the Company has tendered his resignation vide resignation letter dated October 11, 2023 from all his positions in the Company w.e.f close of business hours of October 17, 2023. However, Mr. Bhattad re-joined the Company as Company Secretary & Compliance Officer w.e.f March 01, 2024.
BOARD AND COMMITTEE MEETINGS
The Board met 07 (seven) times during the year. Details of the composition of the Board and its Committees and of the meetings held and attendance of the Directors at such meetings are provided in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Section 173(1) of Companies Act, 2013.
DECLARATION BY INDEPENDENT DIRECTORS
Pursuant to Section 149(7) of the Companies Act, 2013, Rule 6(3) of the Companies (Appointment and Qualification of Directors) Rules, 2014 and Regulation 25(8) of the Listing Regulations, the Company received declaration from Independent Directors (IDs) at the time of appointment and also at the first meeting of the Board held in FY 2023-24, that they meet the criteria of independence and that in the judgement of the Board, they are Independent.
There has been no change in the circumstances affecting their status as ID. In the opinion of the Board, the IDs possess the requisite integrity, experience, expertise and proficiency required under all applicable laws.
All Independent Directors have declared that they have complied with sub-rule (1) and/or subrule (2) of Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014. Also, all Independent Directors have complied with sub-rule (4) of Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, except for Mr. Srinivas Medepalli who declared that he will comply with the same on or before the period mentioned in the said rule.
FAMILIARISATION PROGRAMMES FOR BOARD MEMBERS
The Company at its various meetings held during the financial year 2023-24 had familiarized the Independent Directors through various initiatives. The Independent Directors of the company have been briefed at the meetings of the Board / Committees thereof on the matters such as their roles, functions, rights, duties, responsibilities and liabilities in the Company, nature of the industry in which the Company operates, the business model, business verticals and operations of the Company, geographies in which company operates, financial results of the Company and that of its subsidiary companies, updates on statutory and regulatory changes and impact thereof, updates on development of business of the company, overview of board evaluation and procedures, etc. They were made to interact with business heads and senior management personnel and are given all the documents, reports and internal policies sought by them for enabling a good understanding of the Company, its various operations and the industry of which it is a part of which enables the Directors to contribute significantly to the Company.
Details of familiarization programs extended to the Independent Directors during the year are also disclosed on the Company website from time to time.
Web link: https://resources.ctepl.com/pdfs/investors/Familiarisation+Programme+-+CTEL+- +2024.pdf
PERFORMANCE EVALUATION, NOMINATION & REMUNERATION POLICY
The Company has adopted the Performance Evaluation, Nomination & Remuneration Policy as required under the provisions of the Companies Act, 2013 and Regulation 19 read with Part D of Schedule II of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Brief features of the policy inter-alia includes objective and purpose of the policy which is to lay down the criteria for effective evaluation of performance of Board and that of its committees and individual directors, to establish a framework for the remuneration of directors, key managerial personnel and other employees, to lay down criteria for identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down and recommending to the Board their appointment and removal, criteria for determining qualifications, positive attributes and independence of a director, policy relating to remuneration of directors, key managerial personnel and other employees, to ensure reasonable and sufficient level and composition of remuneration to attract, retain and motivate the Directors, KMPs and Senior Management Personnel etc., and role of Nomination and Remuneration Committee as defined under Section 178 of the Companies Act, 2013 and Regulation 19 read with Part D of Schedule II of the Listing Regulations, 2015.
During the year 2018-19, the above said policy was amended, inter-alia, to comply with provisions introduced by Companies (Amendment) Act, 2017 and SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018 such as specifying the manner for effective evaluation of performance, amendment in criteria of Independence, amendment in definition of senior management, recommendation to the board by nomination and remuneration committee of all remuneration in whatever form payable to senior management, etc.
Performance evaluation, nomination and remuneration policy is available on the website of the Company.
Weblink: https://resources.ctepl.com/pdfs/investors/Performance_evaluation_nomination_remuneration_ policy.pdf
Pursuant to the provisions of Companies Act, 2013 read with the rules made thereunder and SEBI (LODR) Regulations, 2015, the performance evaluation of individual Directors, Board and its Committees was carried out.
The requisite details as required by Section 134(3) and Regulation 34 of SEBI (LODR) Regulations, 2015 and other applicable provisions in this regard is provided elsewhere in this report and/ or Corporate Governance Report.
EVALUATION OF PERFORMANCE OF THE BOARD, ITS COMMITTEES AND DIRECTORS
Pursuant to the provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015, an annual evaluation of performance of the Board, its Committees and of individual Directors has been carried out.
The Nomination & Remuneration Committee evaluated performance of the Directors including Independent Directors for the financial year 2023-24 based on the performance rating document submitted by individual directors and recommended its report to the Board. Thereafter, the Board reviewed performance of its own, its committees and of individual directors including independent Directors based on the performance rating document submitted by individual directors. The assessment is carried out by means of a structured questionnaire with ranking. Based on the report, the Board and the Nomination & Remuneration Committee has informed that the performance of Directors including Independent Directors is satisfactory and they are recommended for continuation as Directors of the Company.
The criteria for performance evaluation of the Board include aspects like experience, proper mix of qualifications, skills and competencies to conduct its affairs effectively, diversity, its roles and responsibilities, its functions, evaluation of risks, setting up of corporate culture and values, conduct of board meetings and its effectiveness, corporate strategy, business plans, corporate performance, etc. The criteria for performance evaluation of the Committees include aspects like structure, mandate, composition, independence, working procedures and functions of committees and effective contribution to the board, etc. The criteria for performance evaluation of the individual Directors (including Independent Directors) include aspects like qualifications, experience, competency, professional conduct, sufficient understanding and knowledge of the entity, fulfilling of functions, active initiation with respect to various areas, attendance at the meetings, contribution to the company and board meetings, commitment to the Board, integrity, etc., In addition, the performance of Independent Directors is evaluated on aspects such as his/her independence from the company and other directors, exercise of judgement and expression of opinion, etc. In addition, the performance of the Chairman is also evaluated on key aspects of his leadership, decisiveness, commitment to the Board, roles and responsibilities, etc.
Separate Meeting of the Independent Directors
A separate meeting of the Company's Independent Directors was also held on February 12, 2024. The meeting was held to:
i. Review the performance of non-independent directors and the Board as a whole;
ii. Review the performance of the Chairperson of the Company, taking into account the views of Executive Directors and Non-Executive Directors;
iii. Assess the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.
Opinion of the Board
The Board is of the opinion that all the Directors of the Company including Independent Director appointed/re-appointed during the financial year possess integrity, necessary expertise and experience (including the proficiency) for performing their functions diligently. The Board also confirms that in its opinion, the independent directors of the Company fulfill the conditions specified in the Companies Act, 2013 read with the rules made thereunder and SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015 and are independent of the management of the Company. The Board cannot provide its opinion on proficiency of Mr. Srinivas Medepalli, Independent Director as he is yet to appear for online proficiency selfassessment test conducted by the institute notified under Section150(1) of the Companies Act, 2013. However, Mr. Srinivas Medepalli declared that he will comply with sub-rule (4) of Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014 i.e., pass an online proficiency self-assessment test on or before the period mentioned in the said rule.
Also, all Independent Directors declared that they have complied with sub-rule (1) and/or subrule (2) of Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014 and except for Mr. Srinivas Medepalli who declared that he will comply with sub-rule (4) of Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014 on or before the period mentioned in the said rule.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(3)(c) and 134(5) of the Companies Act, 2013, the Board of Directors hereby confirm that:
a) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;
b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as on March 31, 2024 and of the profit and loss of the company for that period;
c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
d) they have prepared the annual accounts on a going concern basis;
e) they have 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) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
STOCK EXCHANGE LISTING
We confirm that the Annual Listing Fees for the financial year 2023-2024 have been paid to BSE Limited & and National Stock Exchange of India Limited. However, Annual Listing Fees for the financial year 2024-25 has been paid to National Stock Exchange of India Ltd and is yet to be paid to BSE Limited as on the date of this report.
AUDITORS & AUDITORS' REPORT
Statutory Auditors
M/s. B R A N D & Associates LLP, Chartered Accountants (Firm registration No. 012344S/S200101) were appointed as Statutory Auditors of the Company from the conclusion of 22nd Annual General Meeting till the conclusion of 27th AGM of the company to be held in the year 2026.
The Company has received audit report for both standalone and consolidated audited financial statements of the Company for the financial year ended March 31, 2024 from the statutory auditors, M/s. B R A N D & Associates LLP, Chartered Accountants and forms part of this Annual Report. There are no qualifications, reservation, adverse remarks or disclaimer made by the Statutory Auditors in their Reports. However, there is an emphasis of matter made by the Statutory Auditors in their report on standalone as well as consolidated financial statements and they have stated that their opinion is not modified in respect of this matter.
Emphasis of Matter - Standalone Financial Statements The Company has significant investments in subsidiaries.
Explanation by the Board:
Where applicable, the downstream investments of the respective subsidiaries are expected to carry valuations that will not lead to any diminution in value of the Company's investment in subsidiaries. (Refer Note 5.1 of the standalone financial statements).
Emphasis of Matter - Consolidated Financial Statements
The Group has non-current investments which are valued at cost less impairment.
The Group is of the opinion that these investments carry value as stated in the consolidated financial statements. (Refer Note 5 of the consolidated financial statements).
The statutory auditors stated in their reports stated that they have relied on the same and their opinion is not modified in respect of this matter.
Internal Auditors
Your Directors have appointed M/s. M. Anandam & Co, Chartered Accountants, Hyderabad as Internal Auditors of the Company to conduct internal audit for the financial year 2023 - 24.
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. M/s. Rajora & Co, Practicing Company Secretaries (Proprietor: Ms. Priyanka Rajora, Practicing Company Secretary: CP No. 22886) was appointed to undertake the Secretarial Audit of the Company for the financial year 2023-24. The Secretarial Audit Report for financial year 2023-24 forms part of the Annual Report as Annexure 2 to the Board's Report.
There are qualifications/observations/remarks made by the Secretarial Auditor in her Secretarial Audit Report. However, the explanations or comments by the Board to the qualifications/observations/remarks made by the Secretarial Auditor forms part of the Annual Report as Annexure 2A to the Board's Report.
COMPLIANCE WITH SECRETARIAL STANDARDS
The Board of Directors confirm that the Company, during the financial year ended March 31, 2024, has complied with all applicable mandatory Secretarial Standards issued by the Institute of Company Secretaries of India.
ANNUAL RETURN
The Annual Return will be available on the website of the Company, as mandated under Section 92(3) read with Section 134 (3) of the Companies Act, 2013, and the same can be accessed at web link: https://resources.ctepl.com/pdfs/investors/MGT-7.pdf
PARTICULARS OF EMPLOYEES
The information required under Section 197 (12) of the Act read with Rule 5(1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is annexed as Annexure 3 to this report.
The information required under Rule 5 (2) and (3) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in the Annexure 3 forming part of the Report.
REMUNERATION / FEES TO DIRECTOR FROM WHOLLY OWNED SUBSIDIARY
During FY 2023-24, none of the Directors of the Company received any commission from the Company except for sitting fees/remuneration, as may be applicable. Also, there is no payment of remuneration/fees to any Director of the Company from its wholly owned subsidiary (ies).
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186
Particulars of loans, guarantees and investments, if any, made by the Company pursuant to Section 186 of the Companies Act, 2013 forms part of the financial statements and notes to the financial statements of the Company provided in this Annual Report.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
In terms of Section 125 of the Companies Act, 2013 read with the Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016, during the financial year ended March 31, 2024, there is no outstanding amount to be transferred to Investor Education and Protection Fund.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
A. Conservation of Energy:
(i) the steps taken or impact on conservation of energy: The operations of the Company are not energy intensive. However, adequate steps have been taken to conserve energy wherever possible by using energy efficient computers, turning off air-conditioners during weekends and non-peak hours, installing LED lights, etc. The impact of these measures is not material.
(ii) the steps taken by the company for utilizing alternate sources of energy: There are no steps taken by the Company for utilizing alternate sources of energy.
(iii) the capital investment on energy conservation equipments: There is no capital investment on energy conservation equipment's during the period under review.
B. Technology Absorption, Adaptation and Innovation:
i) the efforts made towards technology absorption: Not Applicable
(ii) the benefits derived like product improvement, cost reduction, product development or import substitution: Not Applicable
(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year): Not Applicable
(a) the details of technology imported;
(b) the year of import;
(c) whether the technology been fully absorbed;
(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof; and
(iv) the expenditure incurred on Research and Development: Not Applicable
Your Company has neither incurred expenditure on any research and development nor was any specific technology obtained from any external sources which needs to be absorbed or adapted. Hence, particulars relating to technology absorption are not applicable. The Company continue to adapt technologies that increase efficiency and improve the quality of its operations.
C. Foreign Exchange Earnings and Outgo: The foreign exchange earned in terms of actual inflows during the year and the foreign exchange outgo during the year in terms of actual outflows:
(In Rupees)
ADEQUACY OF INTERNAL FINANCIAL CONTROL SYSTEM
Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the Internal, Statutory and Secretarial Auditors and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company's internal financial controls were adequate and effective with reference to the financial statements during the financial year 202324.
The Company has in place adequate internal financial controls commensurate with the size and needs of the business. These controls ensures the orderly and efficient conduct of its Business, including adherence to the Company's policies, identification of areas of improvement, safeguarding of its assets from unauthorized use, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and timely preparation of reliable financial statements and / or disclosures. Company policies, guidelines and procedures provide for adequate checks and balances, and are meant to ensure that all transactions are authorized, recorded and reported correctly. Also, please refer details of internal financial controls/Internal control systems that are provided in the Management Discussion and Analysis Report and Independent Auditors Report on financial statements which forms part of this annual report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The requisite details as required by Section 177 of Companies Act, 2013 and Regulation 22 & 34 (3) of SEBI (LODR) Regulations, 2015 is provided in the Corporate Governance Report.
The Whistleblower policy is available on the website of the Company.
Weblink: https://resources.ctepl.com/pdfs/investors/Whistle_Blower_Policy.pdf
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Company is committed to maintaining a productive environment for all its employees at various levels in the organization, free of sexual harassment and discrimination on the basis of gender. The Company has framed a policy on Prevention of Sexual Harassment in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Company has also set up an Internal Complaints Committee (ICC) for providing a redressal mechanism pertaining to sexual harassment against women employees at workplace.
The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Woman at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the financial year 2023-24, the Company has not received any complaints pertaining to Sexual Harassment.
RISK MANAGEMENT
The Company process is in place to ensure that all the Current and Future Material Risks of the Company are identified, assessed/quantified and effective steps are taken to mitigate/ reduce the effects of the risks to ensure proper growth of the business. Your Company has a well- defined risk management framework in place and a robust organizational structure for managing and reporting risks. For details related to risks and risk management, shareholders are requested to refer to "Threats, risks & concerns section" and "Internal control systems and their adequacy section" of Management Discussion and Analysis Report and Note 36 & 37 (for financial instruments & risk management and financial risk management) of the Consolidated Financial Statements and Note 33 & 34 (for financial instruments & risk management and financial risk management) of the Standalone Financial Statements which forms part of annual report.
EMPLOYEE STOCK OPTION SCHEME
The details of employee stock options for the financial year ended March 31, 2024 as per Section 62(1)(b) of the Companies Act, 2013 read with Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 are given as Annexure 4 to this report.
There is no material change in the employee stock option scheme(s) during the year and the scheme(s) are in compliance with the regulations. Further, the disclosures pursuant to the provisions of Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, and as per Section 62(1)(b) of the Companies Act, 2013 read with Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 for the financial year ended March 31, 2024 are available on website of the Company. Web-link: https://www.ctepl.com/investor- esop-disclosure/
The Certificate from the Secretarial Auditor of the Company under regulation 13 of SEBI (Share Based Employee Benefits) Regulations, 2014 stating that the scheme(s) has been implemented in accordance with SEBI (Share Based Employee Benefits) Regulations, 2014, as amended, from time to time and in accordance with the resolution of the company in the general meeting, will be available for inspection by the members at the ensuing AGM.
CEO/CFO CERTIFICATION
Mr. Dharani Raghurama Swaroop, Whole - time Director and Mr. Purnayya Puppala, Chief Financial Officer of the Company have provided Compliance Certificate (annexed as Annexure 5 to this report) to the Board in accordance with Regulation 17(8) read with Part B of Schedule II of the SEBI (LODR) Regulations, 2015 for the financial year ended 31 March 2024.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
The Policy on materiality of related party transactions and on dealing with related party transactions is available on the website of the Company.
Web link: https://resources.ctepl.com/pdfs/investors/Related_party_transactions_policy.pdf
All transactions entered into with Related Parties as defined under the applicable provisions of Companies Act, 2013 and Regulation 23 of the SEBI (LODR) Regulations, 2015 during the year were in the ordinary course of business and on an arms' length basis and hence are not covered under the scope of Section 188(1) of the Companies Act, 2013. However, Information on transactions with related parties pursuant to section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Form AOC-2 and is enclosed as Annexure 6 to this Report. Appropriate approvals, if required, are obtained from Board and / or Audit Committee from time to time. The audit committee also reviews the transactions from time to time.
During the year 2023-24, the Company/Subsidiary (ies) has not entered into any contract / arrangement / transactions with Related Parties (except with its wholly owned subsidiary (ies)) which could be considered as material in terms of Regulation 23 of the SEBI (LODR) Regulations, 2015. In accordance with Ind AS, disclosures on related party transactions have been made in the notes to the financial statements, which forms part of this annual report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT & CORPORATE GOVERNANCE
The Management Discussion and Analysis Report and the Report on Corporate Governance for the financial year ended March 31, 2024 along with the Certificate from Practicing Company Secretary regarding compliance of conditions of corporate governance under SEBI (LODR) Regulations, 2015 is forming part of the Board Report/Annual Report.
Your Company is committed to maintain the prescribed standards of Corporate Governance and has taken adequate steps to adhere to all the stipulations laid down in SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.
M/s. Rajora & Co, Practicing Company Secretaries (Proprietor: Ms. Priyanka Rajora, Practicing Company Secretary: CP No. 22886), Secretarial Auditor of the company has certified the conditions of Corporate Governance for the period ended March 31, 2024 as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and her certificate is annexed as Annexure 7 to this Report.
CORPORATE SOCIAL RESPONSIBILITY
Your company does not have net worth of rupees five hundred crore or more, or turnover of rupees one thousand crore or more or a net profit of rupees five crore or more for the financial year ended March 31, 2021, March 31, 2022 ,March 31, 2023 & March 31, 2024. Hence, Corporate Social Responsibility provisions i.e., Section 135 of the Companies Act, 2013 read with the rules made thereunder are not applicable to the Company.
GENERAL
Your Directors further state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
a. The Company has neither accepted nor renewed any deposits from the public or otherwise in terms of Section 73 of the Companies Act, 2013 read with the rules made thereunder and as such no amount on account of principal or interest thereon on deposits from public was outstanding as on the date of Balance Sheet.
b. There is no issue of equity shares with differential rights as to dividend, voting or otherwise.
c. There were no significant or material orders passed by the Regulators, Courts or Tribunals which impact the going concern status and Company's operations in future.
d. In addition to the information mentioned in this annual report, there were no material changes and commitments affecting financial position of the company between March 31, 2024 and the date of this Board's Report.
e. The Auditors have not reported any matter under Section 143(12) of the Companies Act, 2013 and therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
f. Maintenance of cost records as specified by the Central Government under sub-section (1) of section 148 of the Companies Act 2013 is not required by the Company and
accordingly such accounts and records are neither made nor maintained.
g. There is no one time settlement done with bank or any financial institution. Hence, the details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions is not applicable.
h. There is no proceeding pending under the Insolvency and Bankruptcy Code 2016.
i. The trading in securities of the company has not been suspended.
j. Pursuant to the SEBI (Share Based Employee Benefits) Regulations, 2014 and the Company's Employee Stock Option Scheme 2011 & Employee Stock Option Scheme 2015, the Company, during the year 2015 - 16, has granted employee stock options through a trust set up for the same. The shares purchased by the trust for the said schemes are held by the trustee(s) for the benefit of the employees and are transferred to employee(s) when the employee(s) exercise the vested option. Also, the said trust is a non - promoter and non - public shareholder and it is herewith not exercising its voting rights. Hence, pursuant to Section 67(3) read with Rule 16(4) of the Companies (Share Capital and Debentures) Rules, 2014, the disclosures in respect of voting rights not exercised directly by the employees in respect of shares to which the scheme relates to be made in the Board's report is not applicable.
k. The disclosure required under Rule 8(5)(xi) & (xii) of the Companies (Accounts) Rules, 2014 is not applicable to the Company for the financial year ended March 31, 2024.
APPRECIATIONS & ACKNOWLEDGEMENTS
Your Directors look to the future with confidence. Your Directors wish to express their appreciation for the valuable support and co-operation received from customers, vendors, investors, lenders, business associates and bankers for their continued support during the year. The Directors also thank the State Governments, Government of India, Governments of various countries, other Government Departments particularly Ministry of Electronics and Information Technology, the Ministry of Commerce, the Ministry of Finance, the Ministry of Corporate Affairs, the Income Tax Department, Reserve Bank of India and other government agencies for their support, and looks forward to their continued support. Your Directors are especially indebted to employees of the Company and its subsidiaries at all levels, who through their dedication, cooperation, support and dynamic work, have enabled the company to achieve rapid growth. The Board also wishes to place on record their appreciation of business constituents like SEBI, BSE, NSE, NSDL, CDSL etc. for their continued support for the growth of the Company. Your Directors seek, and look forward to the same support during the future years of growth.