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நிறுவன பெயரின் முதல் சில எழுத்துக்களை நிரப்பி 'கோ' பட்டனை கிளிக் செய்யவும்

Avantel Ltd.-இன் இயக்குநர் அறிக்கை

Mar 31, 2023

Your Directors have pleasure in presenting the 33^rd Annual Report and the Audited Financial Statements (Standalone and Consolidated) for the Financial Year ended March 31,2023:

1. Financial Highlights

The Standalone and Consolidated performance for the Financial Year ended March 31,2023 is as under:

In Lakhs)
Particulars	Standalone		Consolidated
	2022-23	2021-22	2022-23	2021-22
Income from Operations	15,426.73	10,494.37	15,445.11	10,495.35
Other Income	47.41	136.71	47.86	137.04
Total Income	15,474.15	10,631.08	15,492.97	10,632.39
Cost of Materials Consumed	7,658.31	5,068.80	7,699.76	5,089.42
Change in Inventories	(1381.74)	(400.01)	(1381.74)	(400.01)
Employee benefit expenses	1,665.45	1,310.63	1,777.23	1,326.67
Finance Cost	486.08	151.12	486.29	151.30
Depreciation	515.65	397.19	576.76	402.79
Other expenses	2,537.43	1,739.17	2,667.84	1,815.38
Total Expenses	11,481.19	8,266.92	11,826.14	8,385.56
Profit/(Loss) - Before Tax & Exceptional Items	3,992.96	2,364.17	3,666.83	2,246.83
Current Tax	1,033.80	415.45	1,033.80	415.48
Deferred Tax	(44.44)	30.93	(50.76)	33.65
Profit/(Loss) - After Tax	3,003.59	1,917.79	2,683.79	1,797.70
Other comprehensive Income (Net Tax)	(25.34)	(7.62)	(25.34)	(7.62)
Total Comprehensive Income	2,978.25	1,910.17	2,658.45	1,790.08

2. State of the Company''s Affairs

During the financial year 2022-2023, your Company recorded a turnover of Rs.15,426.73 Lakhs and earned a net profit of Rs.2,978.25 Lakhs on a standalone basis and a turnover of Rs.15,445.11 Lakhs and net profit was Rs.2,658.45 Lakhs on consolidation basis.

3. Transfer of amount to Reserves

The Board of Directors do not propose to transfer any amount to the General Reserve for the Financial Year ended March 31, 2023.

4. Dividend

The Board of Directors has recommended a final dividend of Re.1/- per equity share of Rs.10/- (Ten rupees) each fully paid-up of the Company for the financial year 2022-23. 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 Dividend will be paid to members whose names appear in the register of members as on record date and in respect of shares held in dematerialized form, it will be paid to the members whose names are furnished by NSDL and CDSL as beneficial owners as on that date.

5. Listing of Equity Shares

The equity shares of the Company are listed on the trading platform of BSE Limited, a recognized stock exchange having nationwide trading terminal.

6. Subsidiary Companies

M/s. Imeds Global Private Limited, a Wholly Owned Subsidiary Company, continues to contribute to the overall growth in revenues and performance of the Company.

As per the provisions of Section 129 of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing the salient features of the Financial Statements of the Subsidiary Company in Form AOC-1 is enclosed as Annexure - 1.

7. Performance and contribution of each ofthe Subsidiaries, Associates and Joint Ventures

As per Rule 8 of the Companies (Accounts) Rules, 2014, a Report on the financial performance of Subsidiaries, Associates and Joint Venture Companies along with their contribution to the overall performance of the Company during the Financial Year ended March 31,2023 is annexed to this Board''s Report asAnnexure - 1.

8. Consolidated Financial Statements

The Consolidated Financial Statements are prepared in accordance with Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015 notified under Section 133 of the Companies Act, 2013 and other relevant provisions of the Companies Act, 2013.

The Consolidated Financial Statements for the financialYear ended March 31, 2023 forms part of the Annual Report.

As per the provisions of Section 136 of the Companies Act, 2013, the Company has placed the Audited Financial Statements of its Subsidiary Company on its website https://www.avantel.in/ and the same shall be provided to the shareholders upon their request.

9. Bonus Issue

During the Financial Year a Bonus Issue had taken place wherein the Company had allotted 1,21,63,479 Equity Shares of Rs.10/-each as fully paid-up to the Members of the Company, whose names appear in the Register of Members as on the Record date June 20, 2022, in the proportion of 3 (Three) new fully paid-up equity shares of Rs.10/- each for every 1 (One) existing fully paid-up equity share of Rs.10/- each held by them (i.e., in the ratio of 3:1).

10. Share Capital

The Paid-up Share Capital of the Company as on March 31,2023 is Rs.16,21,79,720 divided into 1,62,17,972 Equity Shares of Rs.10 each fully paid up.

11. Variations in Net worth

The Standalone Net worth of the Company for the Financial Year ended March 31,2023 is Rs.11,188.03 Lakhs as compared to Rs.8,262.13 Lakhs for the previous Financial year ended March 31,2022 and the Consolidated Net worth of the Company for the Financial Year ended March 31,2023 is Rs.10,748.17 Lakhs as compared to Rs.8,142.08 Lakhs for the previous Financial year ended March 31,2022.

12. Directors

The Board of Directors of the Company at their meeting held on May 6, 2022, based on the recommendation of the Nomination & Remuneration Committee, had appointed Mr. V. Ramchander (DIN: 03400005) as a Independent Director of the Company with effect from May 6, 2022. Further, the Shareholders of the Company had considered and approved his appointment at the 32^nd AGM held on May 30, 2022, for a period of 5 years.

Except the above, there has been no change in the Board of Directors during the FinancialYear ended March 31, 2023.

13. Appointment/Re-appointment

Mrs. Abburi Sarada (DIN: 00026543), Director of the Company who retires by rotation and being eligible offers herself for reappointment.

14. Key Managerial Personnel

The following have been designated as the Key Managerial Personnel of the Company pursuant to Sections 2(51) and 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

Dr. Abburi Vidyasagar - Managing Director

Mrs. Abburi Sarada - Chief Financial Officer

Mr. D. Rajasekhara Reddy - Company Secretary

During the Year, Mr. Tekuri Venkatesh, Company Secretary of the Company has resigned from the office with effect from October 21,2022 and Mr. D. Rajasekhara Reddy has been appointed as the Company Secretary of the Company with effect from October 21, 2022.

15. Number of Meetings of the Board of Directors

During the financial year ended March 31,2023, four Board meetings were held on the following dates: May 6, 2022, July 29, 2022, October 21, 2022 and January 23, 2023.

The gap between two Meetings did not exceed 120 days and the Meetings were conducted in compliance with all applicable laws. The necessary quorum was present for all the Board Meetings.

The attendance of the Directors at the Board meetings held during theYear were as follows:

Name of the Director	Number of Board Meetings
Name of the Director	Held	Attended
Dr. Abburi Vidyasagar	4	4
Mrs. Abburi Sarada	4	4
Mr. Abburi Siddhartha Sagar	4	4
Mr. Naveen Nandigam	4	4
Mr. Elluru Bala Venkata Ramana Gupta	4	4
Mr. Yalamanchili Kishore	4	3
Mr. Myneni Narayana Rao	4	4
Mr. Ramchander Vyasabhattu	3	3

16. Particulars of Loans, Guarantees, Securities or Investments under Section 186

The details of Loans, Guarantees, Investments and Security made during the Financial Year ended March 31,2023 is given in compliance with the provisions of Section 186 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014 and the same is annexed to the Board''s Report as Annexure - 2.

17. Particulars of Contracts or Arrangements with Related Parties

All related party transactions that were entered into during the financial year were on an arm''s length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.All the related party transactions are approved by the Audit Committee and Board of Directors.

The Company has developed a Policy on Related Party Transactions for the purpose of identification and monitoring of such transactions.

The particulars of contracts or arrangements with related parties referred to in sub section (1) of Section 188 entered by the Company during the Financial Year ended March 31,2023 in prescribed Form AOC-2 is annexed to this Board''s Report as Annexure - 3.

The policy on Related Party Transactions as approved by the Board is uploaded on the website of the Company and the web link is https://www.avantel.in/investors

18. Annual Return

Annual Return in Form MGT-7 is available on the Company''s website, the web link for the same is https://www.avantel.in/investors.

19. The conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to the provisions of Section 134(3)(m) of the Companies Act, 2013 (Act) read with the Companies (Accounts) Rules, 2014

Information with respect to conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to Section 134(3)(m) of the Act read with the Companies (Accounts) Rules, 2014 is annexed to this Board''s Report as Annexure - 4.

20. Audit Committee

During the financial year ended March 31,2023, five Audit Committee meetings were held on the following dates: May 6, 2022, July 29, 2022, October 21, 2022, December 22, 2022 and January 23,2023.

The maximum time gap between any two meetings was not more than one hundred and twenty days.

During the year, there has been no such incident where the Board has not accepted the recommendation of the Audit Committee during the year.

Composition, Name''s of members & Chairperson and Attendance at Meetings

Name of the Director	Designation	Number Meetings
Name of the Director	Designation	Held	Attended
Mr. Naveen Nandigam	Chairman	5	5
Mr. E B V Ramana Gupta	Member	5	5
Mr. Myneni Narayana Rao	Member	5	5
Mr. Yalamanchili Kishore	Member	5	3
Mr. Vyasabhattu Ramchander¹	Member	NA	NA

â¢ formulation of criteria for evaluation of performance of Independent Directors and the board of directors;

â¢ devising a policy on diversity of board of directors;

â¢ identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down and recommend to the board of directors their appointment and removal.

â¢ whether to extend or continue the term of appointment of the independent director, on the basis of the report of performance evaluation of independent directors.

â¢ recommend to the board, all remuneration, in whatever form, payable to senior management.

Composition, name of members & Chairperson, meetings held during the year and attendance at meetings.

During the financial year ended March 31,2023, three Nomination and Remuneration Committee meetings were held on the following dates: May 6, 2022, October 21, 2022 and January 23, 2023.

Composition, Name''s of members & Chairperson and Attendance at Meetings

Name of the Director	Designation	Number Meetings
Name of the Director	Designation	Held	Attended
Mr. Myneni Narayana Rao	Chairman	3	3
Mr. Naveen Nandigam	Member	3	3
Mr. E B V Ramana Gupta	Member	3	3
Mr. Yalamanchili Kishore	Member	3	2
Mr. Vyasabhattu Ramchander*	Member	NA	NA

* Mr. Vyasabhattu Ramchander was appointed as a member of Nomination and Remuneration Committee with effect from January 23, 2023.

22. Corporate Social Responsibility (CSR)

Avantel is committed to improve the lives of the society in which it operates. The Company believes in âlooking beyond businessâ and strives to create a positive impact on the communities it serves and on the environment. The Company is committed not just to profits, but also towards leaving a deeper imprint on the society as a whole. We understand that there is a need to strike a balance between the overall objectives of achieving corporate excellence vis-a-vis the company''s responsibilities towards the community.

Pursuant to the provisions of Section 135 and Schedule VII of the Companies Act, 2013, CSR Committee of the Board of Directors had framed the policy on Corporate Social Responsibility and the Projects and Programmes undertaken by the Company during the year have been provided in Annexure-5 and forms part of this Report.

During the F.Y. 2022-23 the Company was required to spend an amount of Rs.36,46,786/- for implementation of various CSR activities in terms of Section 135 of the Companies Act, 2013. In this regard the Company has spent an amount of Rs.48,38,255/-on CSR activities which is in excess of the minimum amount required to be spent by the Company.

During the financial year ended March 31,2023, three Corporate Social Responsibility Committee meetings were held on the following dates: May 6, 2022, October 21, 2022 and December 22, 2022.

Composition, Name''s of members & Chairperson and Attendance at Meetings

Name of the Director	Designation	Number Meetings
Name of the Director	Designation	Held	Attended
Mrs. Abburi Sarada	Chairperson	3	3
Mr. Naveen Nandigam	Member	3	3
Mr. Yalamanchili Kishore	Member	3	2

23. Stakeholders Relationship Committee

During the year, one Meeting of the Stakeholders Relationship Committee was held on January 23, 2023. Composition, Name''s of members & Chairperson and Attendance at Meetings

Name of the Director	Designation	Number Meetings
Name of the Director	Designation	Held	Attended
Mr. Myneni Narayana Rao	Chairman	1	1
Dr. Abburi Vidyasagar	Member	1	1
Mr. E B V Ramana Gupta	Member	1	1
Mr. Yalamanchili Kishore	Member	1	1

Terms of Reference

(i) Resolving the grievances of the security holders including complaints related to transfer/transmission of shares, nonreceipt of annual report, non-receipt of declared dividends, non-receipt of new/duplicate certificates, etc.

(ii) Review of measures taken for effective exercise of voting rights by shareholders.

(iii) Review of adherence to the service standards adopted by the Company in respect of various services being rendered by the Registrar & Share Transfer Agent.

(iv) Review of the various measures and initiatives taken by the Company for reducing the quantum of unclaimed dividends and ensuring timely receipt of dividend warrants/annual reports/statutory notices by the shareholders of the Company.

24. Share Allotment Committee

During the year, one Meeting of the Share Allotment Committee was held on June 21, 2022.

Composition, Name''s of members & Chairperson and Attendance at Meeting

Name of the Director	Designation	Number Meetings
Name of the Director	Designation	Held	Attended
Dr. Abburi Vidyasagar	Chairman	1	1
Mrs. Abburi Sarada	Member	1	1
Mr. Naveen Nandigam	Member	1	1

The Share Allotment Committee (''SAC'') of the Company have allotted 1,21,63,479 equity shares of Rs.10 each, by way of Bonus Issue, to such members whose names appeared in the Register of Members as on June 20, 2022, being the Record Date fixed for the said purpose, in the proportion of 3 (Three) new fully paid-up equity share of Rs.10/- each for every 1 (One) existing fully paid-up equity share of Rs.10/- each held by them (i.e., in the ratio of 3:1).

25. Mechanism for Evaluation of the Board

Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out an annual evaluation of its own performance and that of its committees as well as performance of the Directors individually. Feedback was sought by way of a structured questionnaire covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance and the evaluation was carried out based on responses received from the Directors.

The evaluation is performed by the Board, Nomination and Remuneration Committee and Independent Directors with specific focus on the performance and effective functioning of the Board and Individual Directors.

In line with SEBI Circular No. SEBI/HO/CFD/CMD/CIR/P/2017/004, dated January 5, 2017, the Company has adopted the criteria recommended by the SEBI.

The Directors were given Five Forms for evaluation of the following:

(i) Evaluation of Board;

(ii) Evaluation of Committees of the Board;

(iii) Evaluation of Independent Directors;

(iv) Evaluation of Managing Director and Executive Directors; and

(v) Evaluation of Chairman.

The Directors were requested to give following ratings for each criteria:

1. Could do more to meet expectations;

2. Meets expectations; and

3. Exceeds expectations.

The Chairperson, based on the Evaluation done by the Directors, informed that the performance of Directors is satisfactory and they are recommended for continuation as Directors of the Company.

26. Management Discussion and Analysis

The Management Discussion and Analysis as required under the Listing Regulations forms an integral part of this Report.

27. Directors'' Responsibility Statement as required under Section 134 ofthe Companies Act, 2013

Pursuant to the requirement under Section 134 of the Companies Act, 2013, with respect to the Directors'' Responsibility Statement, the Board of Directors of the Company hereby confirms:

i) that in the preparation of the Annual Accounts, the applicable accounting standards have been followed;

ii) that the Directors 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 31,2023 and of Profit and Loss Account of the Company for that period;

iii) that the Directors 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;

iv) that the Directors have prepared the Annual Accounts for the Financial Year ended March 31,2023 on a going concern basis;

v) that the Directors 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

vi) that 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.

28. Statement on Declaration given by Independent Directors under Section 149

The Independent Directors have submitted declaration of independence, as required pursuant to sub-section (7) of Section 149 of the Companies Act, 2013 stating that they meet the criteria of independence as provided in sub-section (6) of Section 149.

29. Familiarization programmes imparted to Independent Directors

The Members of the Board of the Company have been provided opportunities to familiarize themselves with the Company, its Management and its operations.The Directors are provided with all the documents to enable them to have a better understanding of the Company, its various operations and the industry in which it operates.

All the Independent Directors of the Company are made aware of their roles and responsibilities at the time of their appointment through a formal letter of appointment, which also stipulates various terms and conditions of their engagement.

Executive Directors and Senior Management provide an overview of the operations and familiarize the new Non-Executive Directors with matters related to the Company''s values and commitments.They are also introduced to the organization structure, constitution of various committees, board procedures, risk management strategies, etc.

Strategic presentations are made to the Board where Directors get an opportunity to interact with Senior Management. Directors are also informed of the various developments in the Company through Press Releases, emails, etc.

Senior management personnel of the Company make presentations to the Board Members on a periodical basis, briefing them on the operations of the Company, plans, strategy, risks involved, new initiatives, etc., and seek their opinions and suggestions on the same. In addition, the Directors are briefed on their specific responsibilities and duties that may arise from time to time.

The Statutory Auditors and Internal Auditors of the Company make presentations to the Board of Directors on Financial Statements and Internal Controls.They will also make presentation on regulatory changes from time to time.

The details of the familiarisation programme are available on the website: https://www.avantel.in/investors

30. Meeting of Independent Directors

A separate meeting of the Independent Directors was held under the Chairmanship of Mr. Yalamanchili Kishore, Independent Director on January 23, 2023, inter-alia, to discuss evaluation of the performance of the Board as a whole, evaluation of the performance of the Chairman, taking into account the views of the Executive and the evaluation of the quality, content and timeliness of flow of information between the management and the Board that is necessary for the Board to effectively and reasonably perform its duties.

The Independent Directors expressed satisfaction with the overall performance of the Directors and the Board as a whole.

31. Registration of Independent Directors in Independent Directors Databank

All the Independent Directors of your Company have been registered and are members of Independent Directors Databank maintained by the Indian Institute of Corporate Affairs (IICA).

32. Online Proficiency Self-AssessmentTest

All Independent Directors of the Company have passed the Online Proficiency Self-Assessment Test conducted by Indian Institute of Corporate Affair (IICA).

33. Confirmation and Opinion of the Board on Independent Directors

All the Independent Directors of the Company have given their respective declaration/ disclosures under Section 149(7) of the Act and Regulation 25(8) of the Listing Regulations and have confirmed that they fulfill the independence criteria as specified under section 149(6) of the Act and Regulation 16 of the Listing Regulations and have also confirmed that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence. Further, the Board after taking these declarations/disclosures on record and acknowledging the veracity of the same, concluded that the Independent Directors are persons of integrity and possess the relevant expertise and experience to qualify as Independent Directors of the Company and are Independent of the Management.

The Board opines that all the Independent Directors of the Company strictly adhere to corporate integrity, possesses requisite expertise, experience and qualifications to discharge the assigned duties and responsibilities as mandated by the Companies Act, 2013 and Listing Regulations diligently.

34. Board Diversity

The Company has over the years been fortunate to have eminent persons from diverse fields to serve as Directors on its Board. Pursuant to the SEBI Listing Regulations, the Nomination & Remuneration Committee of the Board ensured diversity of the Board in terms of experience, knowledge, perspective, background, gender, age and culture.

35. Statement of particulars of appointment and remuneration of managerial personnel

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed to this Board''s Report as Annexure - 6.

36. Directors and Officers Insurance (''D&O'')

As per the requirements of Regulation 25(10) of the SEBI Listing Regulations, the Company has taken Directors and Officers Insurance (''D&O'') for all its Directors and members of the Senior Management.

37. Code of Conduct

Board of Directors have adopted and oversee the administration of the Avantel Limited Code of Business Conduct and Ethics (the ''Code of Conduct''), which applies to all Directors, Officers and Employees of Avantel Limited and its subsidiaries. The Code of Conduct reflects the Company''s commitment to doing business with integrity and in full compliance with the law and provides a general roadmap for all the Directors, Officers and Employees to follow as they perform their day-to-day responsibilities with the highest ethical standards.The Code of Conduct also ensures that all members of Avantel Limited and its subsidiaries perform their duties in compliance with applicable laws and in a manner that is respectful of each other and the Company''s relationships with its customers, suppliers and shareholders, as well as the communities and regulatory bodies where the Company does business.

38. Deposits

The Company has not accepted any deposits from the public in terms of ChapterV of the Companies Act, 2013. Hence, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.

39. Statutory Auditors

The Company''s Statutory Auditors, M/s. Grandhy & Co., Chartered Accountants, (ICAI Firm Registration No. 001007S), were appointed as the Statutory Auditors of the Company for a period of 5 years at the 31^st Annual General Meeting of the Company held on June 5, 2021, to hold office till the conclusion of the 36^th Annual General Meeting of the Company to be held in the year 2026.

Accordingly, M/s. Grandhy & Co., Chartered Accountants, Statutory Auditors of the Company will continue till the conclusion of Annual General Meeting to be held in 2026. In this regard, the Company has received a Certificate from the Auditors to the effect that their continuation as Statutory Auditors, would be in accordance with the provisions of Section 141 of the Companies Act, 2013.

40. Auditors Report

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. Grandhy & Co., Chartered Accountants (ICAI Firm Registration No. 001007S), Statutory Auditors in their report for the FinancialYear ended March 31, 2023.

41. Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors have appointed M/s. P. S. Rao & Associates, Practicing Company Secretaries as Secretarial Auditors to conduct Secretarial Audit ofthe Company for the Financial Year ended March 31, 2023.

The Secretarial Audit Report issued by M/s. P. S. Rao & Associates, Practicing Company Secretaries in Form MR-3 is annexed to this Board''s Report as Annexure - 7.

42. Internal Auditors

The Board of Directors of the Company has appointed M/s. Ramesh & Co., Chartered Accountants (Firm Registration No. 002979S) as Internal Auditors to conduct Internal Audit of the Company for the FinancialYear ended March 31,2023.

43. Cost Audit and Maintenance of Cost Records specified by the Central Government under Section 148 ofthe Companies Act, 2013

In accordance with Section 148(3) and other applicable provisions, if any, of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014, the Board of Directors pursuant to the recommendation of the Audit Committee, had appointed M/s. MPR & Associates, Cost Accountants (Firm Registration No.000413), Hyderabad, as Cost Auditors of the Company, to carry out the audit of the cost records of the products manufactured by the Company during the financial year ending March 31,2024 at a remuneration of Rs.1,00,000/-.

The remuneration payable to the cost auditor is required to be placed before the Members in the general meeting for their ratification. Accordingly, a resolution seeking Members ratification for the remuneration payable to M/s. MPR & Associates, Cost

Accountants, is included in the Notice convening the Annual General Meeting. The Company is maintaining cost records as specified by the Central Government under Section 148(1) of the Companies Act, 2013.

A Certificate from M/s. MPR & Associates, Cost Accountants, has been received to the effect that their appointment as Cost Auditor of the Company, if made, would be in accordance with the limits specified under Section 141 of the Companies Act, 2013 and the Rules framed thereunder.

The Company will file the cost audit report for the Financial Year ended March 31,2023, with the Central Government before the due date.

44. Board''s response on Auditor''s qualification, Reservation or adverse Remark or disclaimer made

There are no qualifications, reservations or adverse remarks or disclaimers made by the Statutory Auditors in their report or by the Cost Auditors in the Cost Audit Report.

Further, the Secretarial Auditors Report contains the following observations:

1) There was a delay in submission of the disclosure of Related Party Transactions for the half year ended on 31^st March, 2022 in terms of Regulation 23(9) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

2) There was a delay in the closure of Trading Window in terms of the Code of Conduct of the company read with the SEBI (Prohibition of InsiderTrading) Regulations, 2015, for the Quarter ended on 31^st March, 2022 and 30^th June, 2022.

3) There was a delay in submission of the Financial Statements in XBRL format for the Quarter ended 31^st March, 2022 in terms of BSE Circular No. DCS/COMP/28/2016-17 dated March 30, 2017.

Boards'' response on observations of Secretarial Audit Report are as follows:

The delay was completely inadvertent in nature due to various administrative reasons. Further, the Company had implemented various systems and procedures to ensure that no such delay submission(s)/ non-compliances be taken place further.

45. Reporting of Frauds by Auditors

During the year under review, the Statutory Auditors, Internal Auditors and Secretarial Auditor have not reported any instances of frauds committed in the Company by its Directors or officers or Employees to the Audit Committee under Section 143(12) of the Companies Act, 2013, details of which needs to be mentioned in this Report.

46. Corporate Governance

The Company has a rich legacy of ethical governance practices and committed to implement sound corporate governance practices with a view to bring about transparency in its operations and maximize shareholder value.

A Report on Corporate Governance along with a certificate from the Independent Auditors of the Company regarding compliance with the conditions of Corporate Governance as stipulated under Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the Annual Report.

47. Vigil Mechanism (Whistle Blower Policy)

The Vigil Mechanism as envisaged in the Companies Act, 2013, the Rules prescribed thereunder and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is implemented through the Company''sWhistle Blower Policy.

The Company has adopted a Whistle Blower Policy establishing a formal vigil mechanism for the Directors and employees to report concerns about unethical behavior, actual or suspected fraud or violation of the Code of Conduct and Ethics. It also provides adequate safeguards against the victimization of employees who avail of the mechanism and provides direct access to the Chairperson of the Audit Committee in exceptional cases. It is affirmed that no personnel of the Company have been denied access to the Audit Committee.The policy of vigil mechanism is available on the Company''s website i.e., https://www.avantel.in/investors

The Whistle Blower Policy aims to conduct the affairs in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behavior.All employees of the Company are covered under the Whistle Blower Policy.

48. Insurance

All properties and insurable interests of the Company have been fully insured.

49. Adequacy of Internal Financial Controls with reference to the Financial Statements

The Corporate Governance Policies guide the conduct of affairs of the Company and clearly delineate the roles, responsibilities and authorities at each level of its governance structure and key functionaries involved in governance. The Code of Conduct for Senior Management and Employees of the Company (the Code of Conduct) commits Management to financial and accounting policies, systems and processes. The Corporate Governance Policies and the Code of Conduct are widely communicated across the Company at all times.

The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (IND AS) as per the Companies (Indian Accounting Standards) Rules, 2015 as amended from time to time notified under Section 133 of the Companies Act, 2013, (the ''Act'') and other relevant provisions of the Act.

The Company maintains all its records in ERP (SAP) System and the workflow and approvals are routed through ERP (SAP).

The Board of Directors of the Company have adopted various policies such as Related Party Transactions Policy,Whistle Blower Policy, Corporate Social Responsibility Policy, Dissemination of material events Policy, Documents preservation policy, Monitoring and Reporting of Trading by Insiders, Code of Internal Procedures and conduct for Regulating, monitoring and reporting of trading by Insiders, Code of Practices and Procedures for Fair Disclosures and such other procedures for ensuring the orderly and efficient conduct of its business for safeguarding of its assets, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

The Company recognizes Internal Financial Controls cannot provide absolute assurance of achieving financial, operational and compliance reporting objectives because of its inherent limitations. Also, projections of any evaluation of the Internal Financial Controls to future periods are subject to the risk that the Internal Financial Control may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate. Accordingly, regular audits and review processes ensure that such systems are reinforced on an ongoing basis.

50. Names of Companies, which have become or ceased to be Company''s Subsidiaries, Joint Ventures or Associate Companies during the year

During the Financial Year, no Company has become or ceased to be Company''s Subsidiary, JointVenture or Associate Company.

51. Change in the nature of business

There has been no change in the nature of business of the Company.

52. The details of significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and Company''s operations in future

The BSE Limited levied a fine of Rs.41,300/- due to delay (5 days) in submission of the disclosure of Related Party Transactions for the half year ended on March 31,2022, in terms of Regulation 23(9) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

There has been no significant material orders passed by the Regulators or Courts or Tribunals which would impact the going concern status of the Company and its future operations.

53. Proceedings under the Insolvency and Bankruptcy Code, 2016 (31 of 2016)

During the Financial year, no application was made or any proceedings pending against the Company under the Insolvency and Bankruptcy Code, 2016.

54. Material changes and commitments

There are no material changes and commitments affecting the financial position of the Company which occurred between the Financial Year ended March 31,2023 to which the Financial Statements relates and the date of signing of this report.

55. Business Responsibility and Sustainability Report

As per Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the ''Business Responsibility and Sustainability Report'' (BRSR) is not applicable to your Company for the year ended March 31,2023.

56. Environment, Health and Safety

The Company has certified with the following Environmental Management Systems (EMS) & Occupational Health and Safety (OH&S) Management System :

ISO 14001:2015 specifies the requirements for an environmental management system that an organization can use to enhance its environmental performance. ISO 14001:2015 is intended for use by an organization seeking to manage its environmental responsibilities in a systematic manner that contributes to the environmental pillar of sustainability.

ISO 45001:2018 specifies requirements for an occupational health and safety (OH&S) management system, and gives guidance for its use, to enable organizations to provide safe and healthy workplaces by preventing work-related injury and ill health, as well as by proactively improving its OH&S performance.

57. Credit Rating

Acuite Ratings & Research Limited (âAcuiteâ) ("Credit Rating Agency") has assigned long-term rating of ''ACUITE BBB '' (read as ACUITE triple B plus) and short-term rating of ''ACUITE A2'' (read as ACUITE A two). The Outlook is ''Stable''.

Brickwork Ratings India Limited (âBrickworkâ) ("Credit Rating Agency") has affirmed long-term rating for Fund based is ''BWR BBB /Stable'' and short-term rating of Non-Fund based is â âBWR A2â. Short-term rating of Non-Fund based is âBWR A2â.

The details of the Credit Ratings are available on the website of the Company at https://www.avantel.in/investors.

58. Nomination and Remuneration Policy

In pursuance of the Company''s policy to consider human resources as its invaluable assets, to pay equitable remuneration to all Directors, Key Managerial Personnel (KMP) and Employees of the Company, to harmonize the aspirations of human resources consistent with the goals of the Company and in terms of the provisions of the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015 as amended from time to time, the policy on nomination and remuneration of Directors, Key Managerial Personnel and Senior Management has been formulated.

Nomination and Remuneration policy of the Company forms part of this Annual Report as Annexure - 8 and the policy is also available on the Company''s website https://www.avantel.in/.

59. Risk Management Policy

The Company has developed and implementing a risk management policy which includes the identification therein of elements of risk, which in the opinion of the board may threaten the existence of the Company.

60. Human Resources

The Company believes that the quality of its employees is the key to its success and is committed to providing necessary human resource development and training opportunities to equip employees with additional skills to enable them to adapt to contemporary technological advancements.

Industrial relations during the year continued to be cordial and the Company is committed to maintain good industrial relations through effective communication, meetings and negotiation.

61. Prevention of Sexual Harassment

The Company has adopted policy on Prevention of Sexual Harassment of Women at Workplace in accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company has not received any complaints during the year.

The Company regularly conducts awareness programs for its employees.

The following is a summary of sexual harassment complaints received and disposed off during the year:

S.No.	Particulars	Status of the No. of complaints received and disposed off
1.	Number of complaints on Sexual harassment received	Nil
2.	Number of Complaints disposed off during the year	Not Applicable
3.	Number of cases pending for more than ninety days	Not Applicable
4.	Number of workshops or awareness programme against sexual harassment carried out	The Company regularly conducts necessary awareness programmes for its employees
5.	Nature of action taken by the employer or district officer	Not Applicable

62. Investor Education and Protection Fund (IEPF)

Pursuant to Section 124 and 125 of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (âIEPF Rulesâ), dividend, if not claimed for a period of seven years from the date of transfer to Unpaid Dividend Account of the Company, are liable to be transferred to IEPF. Members who have not encashed the dividend warrants / demand drafts so far in respect of the unclaimed and unpaid dividends declared by the Company for the Financial Year 2015-16 and thereafter, are requested to make their claim to M/s. KFIN Technologies Limited (Registrars & Share TransferAgents) well in advance of the last dates for claiming such unclaimed and unpaid dividends as specified hereunder:

Sl. No.	For the Financial year ended	Dividend in Rs.	Percentage of Dividend	Date of Declaration	Last date for claiming unpaid Dividend
1	2015-16 (Final Dividend)	Rs.1/-	10%	25-06-2016	25-07-2023
2	2016-17 (Final Dividend)	Rs.2/-	20%	15-09-2017	14-10-2024
3	2017-18 (Final Dividend)	Rs.4/-	40%	27-07-2018	25-08-2025
4	2018-19 (Interim Dividend)	Rs.3/-	30%	28-01-2019	26-02-2026
5	2018-19 (Final Dividend)	Rs.2/-	20%	12-07-2019	10-08-2026
6	2019-20 (Interim Dividend)	Rs.2/-	20%	10-10-2019	08-11-2026
7	2019-20 (Final Dividend)	Rs.2/-	20%	25-06-2020	25-07-2027
8	2020-21 (Final Dividend)	Rs.4/-	40%	05-06-2021	04-07-2028
9	2021-22 (Final Dividend)	Rs.4/-	40%	30-05-2022	28-06-2029

63. Constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has constituted an Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.The Company has not received any complaints during the year.

64. Compliance with Secretarial Standards

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

65. Prevention of InsiderTrading Code

As per SEBI (Prohibition of Insider Trading) Regulation, 2015, the Company has adopted a Code of Conduct for Prevention of Insider Trading. During the year, there has been no due compliance with the said code.

66. Acknowledgements

We express our sincere appreciation and thank our valued Shareholders, Customers, Bankers, Business Partners/Associates, Financial Institutions, Insurance Companies, Central and State Government Departments for their continued support and encouragement to the Company. We are pleased to record our appreciation of the sincere and dedicated services of the employees and workmen at all levels.

By order of the Board of Directors For Avantel Limited

Sd/-

Abburi Vidyasagar

Place: Hyderabad ^Chairman & ^Managⁱⁿg ^Director

Date: May, 17 2023 ^{DIN: 00026524}

Mr. Vyasabhattu Ramchander was appointed as a member of Audit Committee with effect from January 23, 2023.

21. Nomination and Remuneration Committee

? Brief description of the terms of reference:

â¢ formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the board of directors a policy relating to, the remuneration of the directors, key managerial personnel and other employees;

â¢ For every appointment of an Independent Director, the Nomination and Remuneration Committee shall evaluate the balance of skills, knowledge and experience on the Board and on the basis of such evaluation, prepare a description of the role and capabilities required of an Independent Director.The person recommended to the Board for appointment as an Independent Director shall have the capabilities identified in such description. For the purpose of identifying suitable candidates, the Committee may:

a) use the services of an external agencies, if required;

b) consider candidates from a wide range of backgrounds, having due regard to diversity; and

c) consider the time commitments of the candidates.

Mar 31, 2019

Dear Members,

The directors have pleasure in presenting the 29th Annual Report on the business of your Company together with the Audited Statements of Accounts for the financial year ended 3lst March, 20l9.

1. COMPANY PERFORMANCE:

Your Company''s performance during the year ended 3lst March, 20l9, as compared to the previous financial year, is summarized as below:

(Rs.. In Lakhs)

PARTICULARS	Financial Year 2018-19	Financial Year 2017-18
Revenue from Operations	5,051.12	5,l97.23
Other Income	9l.12	l,543.92
Total Revenue	5,142.24	6,741.15
Expenses	3645.97	407l.77
Operating Profit	l496.27	2,669.38
Depreciation	204.72	l63.63
Finance Charges	57.98	86.54
Net Profit / Loss Before Tax (PBT)	1233.57	24l9.2l
Provision for Tax
Current Tax	295.23	516.30
Deferred tax	(12.45)	l72.49
Net Profit (PAT)	950.79	l730.42

During the financial year 2018-19the company has recorded a Profit Before Tax of Rs.12.34 Crores as against Rs.9.13 Crores (other than sale of land & buildings of Rs.15.06 crores) in the previous year with an increase in profit by 35% as compared to previous financial year.

2. TRANSFER TO RESERVES

The Board of Directors of the Company have not recommended for transfer of any amount to the General Reserve for the Financial Ysar ended March 3l, 20l9.

3. DIVIDEND:

Your Directors recommended a final dividend of Rs. 2/- per share for the financial year 2018-l9. The dividend payout is subject to the approval of the members at the ensuing Annual General Meeting.

During the Financial Year 2018-19the company has declared an interim dividend of Rs.3/- per equity share to the members of the company. A table containing the details of the dividend is mentioned below:

Particulars	Dividend (in Rs.)
Interim Dividend	3.00
*Final Dividend	2.00
TOTAL	5.00

* Recommended by the Board of Directors at the meeting held on 07th May, 2019. The payment is subject to the approval of the Shareholders at the ensuing Annual General Meeting scheduled to be held on 12th July, 2019.

The Dividend will be paid to members whose names appear in the register of members as on Friday, the 5th day of July 20l9 and in respect of shares held in dematerialized form, it will be paid to the members whose names are furnished by NSDL and CDSL as beneficial owners as on that date.

4. DIRECTORS & KEY MANAGERIAL PERSONAL:

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the company, Shri. Raghu Prasad Pidikiti (DIN: 0l660157), Director retires by rotation at the forthcoming Annual General Meeting and being eligible offers himself for re-appointment. The Board recommends his reappointment for the consideration of the members of the company at the forthcoming annual general meeting. Brief details of Shri. Raghu Prasad Pidikiti (DIN: 0l660157) has been mentioned in the notice convening the Annual General Meeting at âInformation pursuant to the Listing Regulations and Secretarial Standards in respect of Appointment/ Re-appointment of Directorsâ.

The tenure of Dr. A Vidyasagar, Managing Director expired on 3lst March, 20l9. Taking in to consideration of his rich experience and contribution to the Company, and pursuant to the recommendation of the Nomination and Remuneration Committee, the Board of Directors of the Company, subject to the approval of the members at the ensuing AGM, passed a resolution on 28th January, 20l9, approving the reappointment of Dr. A. Vidyasagar as Managing Director of the Company for a further period of three years with effect from 0lst April, 20l9 to 3lst March, 2022.

Shri. Naveen Nandigam and Shri. Yalamanchili Kishore who were appointed as the independent directors of the company at the 24th Annual General Meeting of the company for a period of five years i.e. up to 29th Annual General Meeting of the company have completed their term of appointment. Further, pursuant to the provisions of Section l49 of the Companies Act, 2013, the recommendations of the Nomination and Remuneration Committee, the Board of Directors of the Company hereby recommends the appointment of Shri. Naveen Nandigam and Shri. Yalamanchili Kishore as the Independent Directors of the company for another period of 5 years.

5. DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration from each Independent director under l49(7) of the Companies Act, 2013, that he/she meets the criteria of Independence laid down under section l49(6) of the Companies Act 2013.

6. MEETINGS OF THE BOARD

The Board met Four times during the financial year 2018-19viz., on 25.05.2018, 02.08.2018, 25.l0.2018 and 28.0l.20l9. The maximum interval between any two meetings did not exceed 120 days.

7. STATUTORY AUDITORS:

M/s. Ramanatham & Rao, Chartered Accountants, who were appointed as the statutory auditors of the company at the 24th Annual General Meeting (AGM) held on September 25, 20l4, to hold office as such till the conclusion of the ensuing 29th AGM (subject to ratification of the appointment by the members at every AGM held after that AGM). The term of the said Statutory Auditors shall expire at the ensuing, 29th Annual General Meeting of the company.

Further, pursuant to Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 20l4 M/s. Ramanatham & Rao, Chartered Accountants, being eligible, offer themselves for re-appointment for a term of 2 (Two) years subject to the ratification by the members at every AGM in accordance with the provisions of Sec. 139 of the Companies Act, 2013 and the rules made there under. The Company has also received written consent from the Auditors and a confirmation to the effect that their re-appointment, if made, would be within the limits prescribed under the Section l4l of the Companies Act, 2013 and the rules made there under.

Accordingly, the appointment of M/s. Ramanatham & Rao, Chartered Accountants, as the statutory auditors of the Company, is hereby placed before the shareholders for their approval.

8. AUDITORSâ REPORT

There are no qualifications, reservations or adverse remarks made by M/s. Ramanatham & Rao., Chartered Accountants, Statutory Auditors in their report for the Financial Year ended 3l^st March, 20l9.

The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company under subsection (12) of section l43 of the Companies Act, 2013, during the year under review.

9. INTERNAL AUDITORS:

The Board of Directors based on the recommendation of the Audit Committee has re-appointed M/s. Ramesh & Co., Chartered Accountants, Hyderabad, as the Internal Auditors of your Company. The Internal Auditors are submitting their reports on quarterly basis.

10. SECRETARIAL AUDITORS:

M/s. P. S. Rao & Associates, Practising Company Secretaries were appointed to conduct the Secretarial Audit of the Company for the financial year 2018-l9, as required under Section 204 of the Companies Act, 2013 and Rule 9 thereunder. The secretarial audit report for FY 2018-19forms part of this Report as Annexure- I.

11. SECRETARIAL AUDIT REPORT

There are no qualifications, reservations or adverse remarks made by M/s. P S. Rao & Associates, Practising Company Secretaries in their report for the Financial Ysar ended 3l^st March, 20l9.

12. RISK MANAGEMENT POLICY

13. CORPORATE SOCIAL RESPONSIBILITY (CSR):

As part of the Corporate Social Responsibility initiative the Company has spent an amount of Rs. Rs. l0,63,983/- (Rupees Ten Lakhs Sixty Three Thousand Nine Hundred and Eighty Three Only ) towards the various CSR activities in the financial year 2018-l9. A report on CSR Activities as required under Rule 9 of the Companies (Corporate Social Responsibility) Rules, 20l4 is enclosed herewith as Annexure - II.

The Company has adopted Corporate Social Responsibility Policy containing the activities to be undertaken by the Company as part of its CSR programs. The CSR Policy is disclosed on the website of the Company www.avantel.in.

Composition of Corporate Social Responsibility Committee:

Smt. A Sarada - Chairperson

Shri. N Naveen - Member

Shri. Y Kishore - Member

Shri. B V K Durga Prasad - Non-Board Member

14. COMPOSITION OF AUDIT COMMITTEE:

The Audit Committee of the Company comprises the following Members

Shri. N. Naveen - Chairman

Shri. Y. Kishore - Member

Shri. Raghu Prasad Pidikiti - Member

Shri. E.B.V. Ramana Gupta - Member

Shri. M. Narayana Rao - Member

All the recommendations made by the Audit Committee of the Company have been considered and accepted by the Board of Directors of the Company.

15. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE OUTGO:

Information required under section 134(3) (m) of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules, 20l4, is enclosed herewith as Annexure- III.

16. FORMAL ANNUAL EVALUATION OF PERFORMANCE OF THE MEMBERS OF THE BOARD AND COMMITTEES

One of the key functions of the Board is to monitor and review the board evaluation framework. The Board works with the nomination and remuneration committee to lay down the evaluation criteria for the performance of executive / non-executive / independent directors through a peer-evaluation excluding the director being evaluated through a Board effectiveness survey. The questionnaire of the survey is a key part of the process of reviewing the functioning and effectiveness of the Board and for identifying possible paths for improvement. Each Board member is requested to evaluate the effectiveness of the Board dynamics and relationships, information flow, decision-making of the directors, relationship to stakeholders, company performance, company strategy, and the effectiveness of the whole Board and its various committees on a scale of one to five. Feedback on each director is encouraged to be provided as part of the survey.

Independent directors have three key roles - governance, control and guidance. Some of the performance indicators based on which the independent directors are evaluated include:

- Ability to contribute by introducing international best practices to address top-management issues

- Active participation in long-term strategic planning

- Commitment to the fulfillment of a director''s obligations and fiduciary responsibilities; these include participation in Board and committee meetings.

A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors who also reviewed the performance of the Secretarial Department. The Directors expressed their satisfaction with the evaluation process.

17. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:

The Company has in place an Internal Control System, commensurate with the size, scale and complexity of its operations. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed.

18. SUBSIDIARIES/ ASSOCIATE COMPANIES/ JOINT VENTURES:

The Company has no subsidiaries/ associate companies/ joint ventures as on 3l^st March, 20l9.

19. NOMINATION AND REMUENRATION POLICY:

A committee of the Board named as âNomination and Remuneration Committeeâ has been constituted to comply with the provisions of section l78 of Companies Act, 2013 and to recommend a policy of the Company on directors'' appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters and to frame proper systems for identification, appointment of Directors & KMPs, Payment of Remuneration to them and Evaluation of their performance and to recommend the same to the Board from time to time. The policy is also posted in the investors section of the company''s website.

20. FIXED DEPOSITS:

Your Company has not accepted any fixed deposits and as such no principal or interest was outstanding as on the date of the Balance sheet.

21. PARTICULARS OF LOANS, GUARANTEES, OR INVESTMENTS:

Details of the Loans, guarantees and investments covered under Section 186 of the Companies Act, 2013, if any, are given in the notes to the financial statements pertaining to the year under review.

22. POLICY ON SEXUAL HARASSMENT:

The company has adopted policy on prevention of sexual harassment of women at workplace in accordance with The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

During the financial year ended March 3l, 20l9, the company has not received any complaints pertaining to sexual harassment.

23. DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 134 (5) of the Companies Act, 2013 Your Directors'' confirm that:

i) In preparation of annual accounts for the financial year ended 3l^st March, 20l9, the applicable Accounting Standards have been followed along with proper explanation relating to material departures;

ii) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year ended 3l^st March, 20l9 and of the profit and loss of the Company for the year;

iii) The Directors have taken proper and sufficient care for their maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) The Directors had prepared the annual accounts on a âgoing concern'' basis;

v) 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

vi) 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.

24. VIGIL MECHANISM:

The Company has a Whistle Blower Policy framed to deal with instance of fraud and mismanagement, if any in the Company. The details of the Policy are posted on the website of the Company www.avantel.in on the following link http://www.avantel.in/inversteinfo.php

25. RELATED PARTY TRANSACTIONS:

Related party transactions entered during the financial year under review are disclosed in Note No. 34 of the Financial Statements of the Company for the financial year ended 3l^st March, 20l9. These transactions entered were at an arm''s length basis and in the ordinary course of business. There were no materially significant related party transactions with the Company''s Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Form AOC-2, containing the note on the aforesaid related party transactions is enclosed herewith as Annexure - IV.

The Policy on the Related Party Transactions as approved by the Board is uploaded on the website of the Company.

26. EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure - V. Further, pursuant to the provisions of Section 92 (3) of the Companies Act, 2013 the Annual Return of the company is placed on the website of the Company www.avantel.in on the following link http://www.avantel.in/inversteinfo.php.

27. STATE OF AFFAIRS OF THE COMPANY

The State of Affairs of the Company is presented as part of Management Discussion and Analysis Report forming part of this Report.

28. MANAGEMENT DISCUSSION AND ANALYSIS:

Pursuant to Regulation 34 (2) (e) of SEBI (LODR) Regulations, 2015, a report on Management Discussion & Analysis is herewith annexed as Annexure-VI.

29. CORPORATE GOVERNANCE REPORT:

Pursuant to Regulation 34 read with Schedule V of SEBI (LODR) Regulations, 2015, a report on Corporate Governance is herewith annexed as Annexure-VII.

30. PARTICULARS OF EMPLOYEES:

The information required pursuant to Section l97 (12) read with Rule 5 (l) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 20l4, in respect of employees of the Company is herewith annexed as Annexure- VIII.

In terms of Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 20l4, the Company does not have any employee who is employed throughout the financial year and in receipt of remuneration of Rs. 120 Lakhs or more, or employees who are employed for part of the year and in receipt of Rs. 8.50 Lakhs or more per month.

The Company does not have any employee who is employed throughout financial year or part thereof, who was in receipt of remuneration in financial year under review which in 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 and holds by himself or along with his spouse and dependent children not less than 2% of the equity shares of the Company.

31. HUMAN RESOURCES:

Your Company considers its Human Resources as the key to achieve its objectives. Keeping this in view, your Company takes utmost care to attract and retain quality employees. The employees are sufficiently empowered and such work environment propels them to achieve higher levels of performance. The unflinching commitment of the employees is the driving force behind the Company''s vision. Your Company appreciates the spirit of its dedicated employees.

32. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

There are no significant material orders passed by the Regulators /Courts/ Tribunals which would impact the going concern status of the Company and its future operations.

33. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There were no Material Changes and Commitments Affecting the Financial Position of the Company.

34. ACKNOWLEDGMENT AND APPRECIATION:

Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business associates for their consistent support and continued encouragement to the Company.

Further your Directors convey their appreciation for the whole hearted and committed efforts by all its employees.

Your Directors gratefully acknowledge the ongoing co-operation and support provided by the Central and State Governments, Stock Exchanges, SEBI, RBI and other Regulatory Bodies.

By order of the Board of Directors

For Avantel Limited

Sd/-

Place: Hyderabad A Vidyasagar

Date: 07^th May, 20l9 Chairman & Managing Director

DIN: 00026524

Mar 31, 2018

Dear Members,

The Directors have pleasure in presenting the 28^th Annual Report on the business of your Company together with the Audited Statements of Accounts for the financial year ended 31^st March, 2018.

1. FINANCIAL SUMMARY:

Your Companyâs performance during the year ended 31^st March, 2018, as compared to the previous financial year, is summarized as below:

(Rs. In Lakhs)

PARTICULARS	Financial Year 2017-18	Financial Year 2016-17
Total Revenue	6,754.26	3,500.08
Expenses	4,084.88	3,063.40
Operating Profit	2,669.38	436.68
Depreciation	163.63	179.33
Finance Charges	86.54	151.84
Net Profit / Loss Before Tax (PBT)	2419.21	105.51
Provision for Tax
Current Tax	516.30	23.44
Deferred tax	172.49	-6.30
Net Profit (PAT)	1,730.42	88.37

2. TRANSFER TO RESERVES

The Company did not transfer any amount to the General Reserve for the Financial Year ended March 31^st, 2018.

3. COMPANY PERFORMANCE:

Your Company posted good financial results with a net profit of Rs. 17.30 crores during the year under review. Due to continuous efforts of the management the turnover of the company increased by 51% to that of the previous year. The Company is looking forward to increase its profits in the coming financial years with the support of all the stakeholders of the Company besides contributing to the society as a good corporate citizen.

4. SHARE CAPITAL

The paid up equity share capital of the Company as on 31st March, 2018, is Rs. 4,05,50,930/-. During the year under review, the Company has not issued shares with differential voting rights, sweat equity shares or Employee Stock Options.

5. DIVIDEND:

Your Directors recommended a dividend of Rs. 4.00/-i.e. 40% per equity share of Rs.10/- each for the financial year 2017-18. The dividend payout is subject to the approval of the members at the ensuing Annual General Meeting.

The Dividend will be paid to members whose names appear in the register of members as on 20.07.2018 and in respect of shares held in dematerialized form, it will be paid to the members whose names are furnished by NSDL and CDSL as beneficial owners as on that date.

6. DIRECTORS & KEY MANAGERIAL PERSONAL:

During the financial year there were no changes in the Board of Directors and Key Managerial Personnel of the Company.

In accordance with the provisions of Section 152 of Companies Act, 2013, Shri. Subramaniya Balakrishnan, Director of the Company retires by rotation and being eligible, has offered himself for re-appointment.

7. DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration, from each Independent director under 149(7) of the Companies Act, 2013, that he/she meets the criteria of Independence laid down under section 149(6) of the Companies Act 2013.

8. MEETINGS OF THE BOARD

The Board met Five times during the financial year 2017-18 viz., on, 6th April, 2017, 30th May, 2017, 3rd August, 2017, 8th November, 2017, and 27^th January, 2018. The maximum interval between any two meetings did not exceed 120 days.

9. STATUTORY AUDITORS:

At the Annual General Meeting (AGM) held on September 25, 2014, M/s. Ramanatham & Rao, Chartered Accountants, were appointed as the Statutory Auditors of the Company to hold office from the conclusion of that AGM till the conclusion of the 29th AGM (subject to ratification of the appointment by the members at every AGM held after that AGM) at such remuneration as may be decided by the Board of Directors. In terms of the first proviso to Section 139 of the Companies Act, 2013, the appointment of the auditor shall be placed for ratification at every Annual General Meeting. Accordingly, the appointment of M/s. Ramanatham & Rao, Chartered Accountants, as the statutory auditors of the Company, is hereby placed for ratification by the shareholders. In this regard, the Company has received a certificate from the auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.

10. AUDITORSâ REPORT

There are no qualifications, reservations or adverse remarks made by M/s. Ramanatham & Rao., Chartered Accountants, Statutory Auditors in their report for the Financial Year ended 31st March, 2018.

The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company under sub-section (12) of section 143 of the Companies Act, 2013, during the year under review.

1 1. INTERNAL AUDITORS:

12. SECRETARIAL AUDITORS:

M/s. P. S. Rao & Associates, Practicing Company Secretaries were appointed to conduct the Secretarial Audit of the Company for the financial year 2017-18, as required under Section 204 of the Companies Act, 2013 and Rule 9 there-under. The secretarial audit report for F.Y 2017-18 forms part of this Report as Annexure- I.

13. SECRETARIAL AUDIT REPORT

There are no qualifications, reservations or adverse remarks made by M/s. P S. Rao & Associates, Practicing Company Secretaries in their report for the Financial Year ended 31st March, 2018.

14. RISK MANAGEMENT POLICY

15. CORPORATE SOCIAL RESPONSIBILITY (CSR):

As part of the Corporate Social Responsibility initiative, the Company has spent 8,01,875/- towards various CSR activities in the financial year 2017-18. A report on CSR Activities as required under Rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014 is enclosed herewith as Annexure - II.

Composition of Corporate Social Responsibility Committee:

Smt. A Sarada - Chairman

Shri. N Naveen - Member

Shri. Y Kishore - Member

Shri. B V K Durga Prasad - Member

16. COMPOSITION OF AUDIT COMMITTEE:

The Audit Committee of the Company comprises the following Members

Shri. N. Naveen - Chairman

Shri. Y. Kishore - Member

Shri. Raghu Prasad Pidikiti - Member

Shri. E.B.V. Ramana Gupta - Member

Shri. M. Narayana Rao - Member

All the recommendations made by the Audit Committee of the Company have been considered and accepted by the Board of Directors of the Company.

17. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE OUTGO:

Information required under section 134(3) (m) of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014, is enclosed herewith as Annexure- III.

18. FORMAL ANNUAL EVALUATION OF PERFORMANCE OF THE MEMBERS OF THE BOARD AND COMMITTEES

One of the key functions of the Board is to monitor and review the board evaluation framework. The Board works with the nomination and remuneration committee to lay down the evaluation criteria for the performance of executive / non-executive / independent directors through a peer-evaluation excluding the director being evaluated through a Board effectiveness survey. The questionnaire of the survey is a key part of the process of reviewing the functioning and effectiveness of the Board and for identifying possible paths for improvement. Each Board member is requested to evaluate the effectiveness of the Board dynamics and relationships, information flow, decisionmaking of the directors, relationship to stakeholders, company performance, company strategy, and the effectiveness of the whole Board and its various committees on a scale of one to five. Feedback on each director is encouraged to be provided as part of the survey.

Independent directors have three key roles -governance, control and guidance. Some of the performance indicators based on which the independent directors are evaluated include:

- Ability to contribute by introducing international best practices to address top-management issues

- Active participation in long-term strategic planning

- Commitment to the fulfillment of a directorâs obligations and fiduciary responsibilities; these include participation in Board and committee meetings.

19. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:

20. SUBSIDIARIES:

The Company has no subsidiaries as on 31st March, 2018.

21. NOMINATION AND REMUENRATION POLICY:

A committee of the Board named as âNomination and Remuneration Committeeâ has been constituted to comply with the provisions of section l78 of Companies Act, 2013 and to recommend a policy of the Company on directorsâ appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters and to frame proper systems for identification, appointment of Directors & KMPs, Payment of Remuneration to them and Evaluation of their performance and to recommend the same to the Board from time to time. The policy is also posted in the investors section of the companyâs website.

22. FIXED DEPOSITS:

Your Company has not accepted any fixed deposits and as such no principal or interest was outstanding as on the date of the Balance sheet.

23. PARTICULARS OF LOANS, GUARANTEES, OR INVESTMENTS:

Details of the Loans, guarantees and investments covered under Section 186 of the Companies Act, 2013, if any, are given in the notes to the financial statements pertaining to the year under review.

24. POLICY ON SEXUAL HARASSMENT:

During the financial year ended March 31, 2018, the company has not received any complaints pertaining to sexual harassment.

25. DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 134 (5) of the Companies Act, 2013 Y^ur Directorsâ confirm that:

i) In preparation of annual accounts for the financial year ended 31st March, 2018, the applicable Accounting Standards have been followed along with proper explanation relating to material departures;

ii) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year ended 31st March, 2018 and of the profit and loss of the Company for the year;

iv) The Directors had prepared the annual accounts on a âgoing concernâ basis;

v) 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

vi) 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.

26. VIGIL MECHANISM:

27. RELATED PARTY TRANSACTIONS:

Related party transactions entered during the financial year under review are disclosed in Note No. 36 of the Financial Statements of the Company for the financial year ended 31 st March, 2018. These transactions entered were at an armâs length basis and in the ordinary course of business. There were no materially significant related party transactions with the Companyâs Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Form AOC-2, containing the note on the aforesaid related party transactions is enclosed herewith as Annexure - IV.

The Policy on the Related Party Transactions as approved by the Board is uploaded on the website of the Company.

28. EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure - V.

29. STATE OF AFFAIRS OF THE COMPANY

The State of Affairs of the Company is presented as part of Management Discussion and Analysis Report forming part of this Report.

30. MANAGEMENT DISCUSSION AND ANALYSIS:

Pursuant to Regulation 34 (2) (e) of SEBI (LODR) Regulations, 2015, a report on Management Discussion & Analysis is herewith annexed as Annexure-VI.

31. CORPORATE GOVERNANCE REPORT:

As the networth of the company as on 31st March, 2018 stands more than 25 crores, the company is required to comply with the provisions of corporate governance as mentioned under Regulation l5 of Securities and Exchange Board of India (Listing Obligalations and Disclosure Requirements) Regulations, 2015 with in six months therefrom. The Company is taking adequate steps to comply with the said compliances.

32. PARTICULARS OF EMPLOYEES:

The information required pursuant to Section 197 (12) read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, in respect of employees of the Company is herewith annexed as Annexure- VII.

In terms of Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company does not have any employee who is employed throughout the financial year and in receipt of remuneration of Rs. 120 Lakhs or more, or employees who are employed for part of the year and in receipt of Rs. 8.50 Lakhs or more per month.

33. HUMAN RESOURCES:

Ybur Company considers its Human Resources as the key to achieve its objectives. Keeping this in view, your Company takes utmost care to attract and retain quality employees. The employees are sufficiently empowered and such work environment propels them to achieve higher levels of performance. The unflinching commitment of the employees is the driving force behind the Companyâs vision. Your Company appreciates the spirit of its dedicated employees.

34. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

There are no significant material orders passed by the Regulators /Courts/ Tribunals which would impact the going concern status of the Company and its future operations except as stated below:

AMALGAMATION:

As the members are aware that the company had filed a petition with the Honâble National Company Law Appellate Tribunal, New Delhi against the order passed by the Honâble National Company Law Tribunal, Hyderabad Bench to approve the proposed Scheme of Amalgamation between Avantel Limited (Transferee Company) and Wiki Kids Limited (Transferor Company) and their respective shareholders and creditors. Even though all the statutory authorities conveyed their no objection to the said Scheme it did not find in favour with the Honâble National Company Law Appellate Tribunal, New Delhi. In this regard the board of directors have decided to not pursue further.

35. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There were no Material Changes and Commitments Affecting the Financial Position of the Company.

36. ACKNOWLEDGMENT AND APPRECIATION:

Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business associates for their consistent support and continued encouragement to the Company.

Further your Directors convey their appreciation for the whole hearted and committed efforts by all its employees.

Your Directors gratefully acknowledge the ongoing co-operation and support provided by the Central and State Governments, Stock Exchanges, SEBI, RBI and other Regulatory Bodies.

By order of the Board of Directors

For Avantel Limited

Sd/-

Place: Hyderabad A Vidyasagar

Date: 28^th May, 2018 Chairman & Managing Director

DIN: 00026524

Mar 31, 2014

Dear Members,

The Directors take pleasure in presenting the Twenty Fourth Annual Report on the operations of your Company and the Audited Accounts for the financial year ended 31st March, 2014 together with the Auditors'' Report thereon.

FINANCIAL PERFORMANCE OF THE COMPANY:

Your Company''s results for the year in comparison with the previous year are given below in a summarized format:

(Rs.In Lakhs) Current Year Previous Year Particulars 2013-14 2012-13

Income 1318.91 4315.67

Expenses 1122.84 3270.64

Operating Profit 196.07 1045.03

Depreciation 198.99 126.40

Financial expenses 112.27 99.04

Profit/ (Loss) before Tax (115.19) 819.59

(PBT)

Provision for tax:

Current & Deferred 11.82 167.67

Profit/(Loss) after Tax (103.37) 651.92

(PAT)

Profit brought forward 984.05 623.25

Profit Available for 880.68 1275.17 Appropriation

Appropriations:

Transferred to General - 160.00

Reserve

Proposed Dividend - 112.07

Corporate Dividend Tax - 19.05

Balance carried to 880.68 984.05 balance sheet

Earnings Per Share (EPS)

- Basic - 14.54

- Diluted - 14.54

Your company''s fi nancial performance during the current year 2013-14 is quite unsatisfactory when compared to the last year as most of the orders for important projects have been delayed due to reasons beyond the control of the Company. However we are happy to inform you that we have now received the supply orders from Ministry of Defence and we are confi dent that the fi nancial year 2014- 15 will show good results.

1. DIVIDEND:

The Board of Directors does not recommend any dividend for the fi nancial year under review due to the reason that the company has incurred loss of Rs.115.19 lakhs for the year ending 31st March, 2014.

2. MANAGEMENT''S DISCUSSION AND ANALYSIS:

A. Macro-Economic Overview: Prospects of Indian Economy in 2014 -15

In the recent past, the Indian economy had to overcome varied challenges such as growth slowdown and infl ationary pressures. The slowdown manifested in the decline in the growth of Gross Domestic Product (at factor cost at constant 2004-05 prices) from 8.9 per cent in 2010-11 to 6.7 per cent in 2011-12 and 4.5 per cent in 2012-13. With the economy projected to have registered a growth rate of 4.9 per cent in 2013-14, the declining trend in growth seems to have reversed. The World Economic Outlook (WEO) update released by the International Monetary Fund in January 2014 has revised the growth projection for the world economy slightly upwards to 3.0 per cent and 3.7 per cent for 2013 and 2014 respectively. From 2014 onwards, global growth prospects are projected to improve over the medium term at a gradual pace. (Source: India budget.nic.inub 2014-15).

B. Defence Overview 2014 Â 2015

The current Defence Procurement Procedure (DPP)-2013 explicitly backs indigenous procurement over foreign purchases. It stipulates that Indian defence companies will get access to the military''s long-term equipment roadmap, providing them with the time needed for developing the military''s future equipment requirements; with a level playing fi eld between the Defence Public Sector Undertakings (DPSUs) and private defence companies; simplifi es the "Buy & Make (Indian)" procedure to benefit Indian industry; and defi nes ambiguous terms in the DPP like "indigenous content."

DPP-2013 lays down an order of preference for categories, in which building and buying in India is at the top and buying over-the-counter abroad is the last priority. The order of preference is: (1) "Buy (Indian)" (2) "Buy & Make (Indian)" (3) "Make" (4) "Buy & Make with ToT" and (5) "Buy (Global)". Any proposal to select a particular category must now state reasons for excluding the higher preferred category/categories". But DPP-2013''s most far-reaching change lies in its stringent defi nition of "indigenous equipment". The successive DPPs of 2002, 2005, 2006, 2008, 2009 and 2011 have regarded all equipment purchased from Indian suppliers as "indigenous", even when it contains 80-90 per cent foreign- sourced items, with just 10-20 per cent Indian components, that too in secondary fi elds like assembly and delivery. Now DPP-2013 rules that, "Import content in the products supplied by the sub-vendors will not qualify towards indigenous content".

The new defi nition of "indigenous content" requires the following to be deducted from the cost of indigenous equipment: the direct costs of all materials, components, sub-assemblies, assemblies and products imported into India; the costs of all services obtained from non- Indian entities; all royalties, licence fees, technical fees etc. that are paid abroad. While vendors are allowed to self-certify the true value of indigenisation, certain safeguards have been put in place, such as the banning or suspending of a vendor for up to fi ve years if any false certifi cation is detected.

In addition to the steady evolution of the DPP over the years, there is recognition that the "Make" procedure needs to be simplifi ed to attract more Indian private players into defence production. In addition to simplifying procedures in successive DPPs, a full-fl edged exercise is underway to rewrite the ''Make'' and the ''Fast Track'' Procedure. This MoD insiders hope, might be completed by the end of this year.

MoD has also released the "Technology Perspective & Capability Road Map" (TPCR 2013), to provide the industry an overview of the direction in which the Armed Forces intend to head in terms of capability over the next 15 years, which in turn would drive the technology in the developmental process. It is based on the LTIPP of the Armed Forces. The document has been put up in the public domain in line with the vision of former defence minister Shri AK Antony, Raksha Mantri, to establish a level playing fi eld for the Indian defence industry, both public sector and private sector. The new policy also entitles private companies to access to important details from the military''s 15-year Long Term Integrated Perspective Plan (LTIPP). This will allow industry the lead-time needed to meet future equipment needs.

ACCOMPLISHMENTS:

- Developed Satellite based Voice Communication Terminals for MR Aircrafts for Indian Defense Services.

- Developed and supplied Satellite Mobile Radio (SMR) for ISRO.

- Developed and supplied L-Band Demodulators for ISRO.

- Developed and supplied High Power Broad Band Power amplifi er in the Frequency Band of 1 -2.5GHz, 500W for DRDO.

- Developed and supplied Portable Multimedia Terminals for ISRO.

- Developed Voice and Data Terminals using Auto tracking unit. (ATU).

- Developed Data Terminals for Helicopters, Submarines & Marine Commandos.

C. OVRVIEW OF OPERATIONS:

The Company has recorded a total income of ^ 1318.91 Lacs as against Rs.4315.67 Lacs for the previous year and has incurred a loss during the year at Rs.103.37 lakhs as against Profit after tax of ^ 651.92 lakhs for the previous year.

D. OUTLOOK AND STRATEGY FOR CURRENT YEAR:

Your Company has developed Mobile Satellite Services based products and UHF Communication Systems and continue to offer solutions for various applications. Your company is looking forward to growth in this segment by offering integrated solutions for Airborne, Underwater platforms and special operations. The Company is also developing 1 KW HF- communication system for Indian Navy. The Priority segments include provision of MSS for Helicopters and UHF Satcom for MR class Aircrafts & Helicopters of Indian Navy.

E. INTERNAL CONTROL SYSTEMS:

Periodical internal quality audits and management review meetings ensure successful implementation of the Quality Management System. The ISO compliance Management Information System seamlessly integrates all the intra and inter-departmental activities of the organization, simultaneously ensuring data integrity and effective monitoring of the day-to- day operations. In addition, the Company has appointed independent internal auditors to carry out the internal audit on a regular basis. The internal audit is supplemented by external audit and periodic review by the Management.

F. INDUSTRIAL RELATIONS:

Your Company had harmonious relations throughout the year at all levels of the organization and would endeavor to maintain this cordial relationship in the future as well. Your Directors wish to place on record their deep sense of appreciation for the valuable work done and co-operation extended by the employees at all levels.

3. DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of Directors hereby confi rms that: -

i. In the preparation of the annual accounts, the applicable Accounting Standards have been followed and there is no material departure.

ii. Appropriate accounting policies have been selected and applied consistently and have 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 31st March, 2014 and of the Profit of the Company for the year ended on that date.

iii. Proper and suffi cient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities.

iv. Annual accounts have been prepared on a ''going concern'' basis.

4. DEPOSITS:

During the year, the Company has not accepted any deposits covered under the provisions of Sec. 58A of the Companies Act, 1956, read with Companies (Acceptance of the Deposit Rules), 1975.

5. PARTICULARS OF EMPLOYEES:

The particulars of employees, which are required to be given under Sec 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Amendment Rules, 2011:

a. Particulars of employees who are in receipt of Rs.60 lakhs or more per annum: NIL

b. Particulars of employees employed for a part of the fi nancial year with a salary of Rs.5 lakh or above per month : NIL

6. MATERIAL DEVELOPMENTS IN HUMAN RESOURCES/INDUSTRIAL RELATIONS FRONT INCLUDING NUMBER OF PEOPLE EMPLOYED.

The Company believes that the quality of the employees is the key to its success in the long run and is committed to provide necessary human resource development and training opportunities to equip them with skills, enabling them to adopt the contemporary technology advancements.

An atmosphere of cordial relations with the employees has prevailed in the organization all over the year During the year, the Company has organized training programmes for all the categories of employees in different segments to enable them to sharpen their skills, thereby increasing the overall effi ciency of the organization

As on 31st March 2014, the employee strength stands at 165.

7. CONSERVATION OF ENERGY & FOREIGN EXCHANGE INFLOW AND OUTFLOW:

The details, as required under Sec 217(1) (e) of the Companies Act, 1956, read with Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988, are given in Annexure-I.

8. TECHNOLOGY, PATENTS, R&D AND INNOVATION:

Your Company has submitted fi ve applications to the Patent offi ce, Government of India, for grant of Patents under different R&D inventions. All are published in the Patents Journal and are waiting for further examination in chronological order of applications fi led. The members will be informed of the grant of patents as and when they happen.

9. STATUTORY COMPLIANCE:

During the year, the company has complied with all the statutory provisions in all respects with regard to all the affairs of the Company.

10. CORPORATE GOVERNANCE:

The Company is committed to achieve the highest standards of corporate governance and it complies not with just letter of law but also spirit of law.

As required under Clause 49 of the Listing Agreement with the Stock Exchanges, a separate section on Corporate Governance practices followed by the Company together with a certifi cate from a Statutory Auditors of the company confi rming compliance is annexed as part of the Annual Report in Annexure- II.

11. SECRETERIAL COMPLIANCE CERTIFICATE

Certifi cate from a Practicing Company Secretary as stipulated in Section 383A of the Companies Act, 1956 read with Companies (Compliance Certifi cate) Rules, 2001 is annexed as part of the Annual Report in Annexure- III.

12. LISTING FEES:

The Company has paid the listing fees for the year 2014-15 to BSE Limited in pursuance of the Listing Agreement.

13. SHIFTING OF REGISTERED OFFICE:

During the year under review, the Company has shifted its Registered Offi ce w.e.f 5th September, 2013 from Plot No. 16, Sector III, Huda Techno Enclave, Opp. K Raheja IT Park, Madhapur, Hyderabad-500081 to the Sy No. 141, Plot No 47/P, APIIC Industrial Park, Gambheeram (V), Anandapuram (M), Vishakhapatnam, Andhra Pradesh Â 531163 by passing a Special Resolution through postal ballot.

14. AUDITORS:

M/s. Ramanatham & Rao, Chartered Accountants, the Statutory Auditors of the Company retire at the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment for a term of 5 (fi ve) years subject to the ratifi cation by the members at every AGM in accordance with the provisions of Sec. 139 of the Companies Act, 2013 and the rules made thereunder.

The Company has received written consent from the Auditors and a confi rmation to the effect that their re-appointment, if made, would be within the limits prescribed under Section 141 of the Companies Act, 2013 and the rules made thereunder.

15. COST AUDIT REPORT:

The Company has received the cost audit report from Mr. N.V.S. Kapardhi, Cost Accountant, the Cost Auditor for the fi nancial year 2013-2014. There are no qualifi cations or remarks made by the cost auditors in their report.

The Board has reappointed Mr. N.V.S. Kapardhi, Cost Accountant, as Cost Auditor to carry out the Cost audit of the Company for the fi nancial year 2014-15.

16. DIRECTORS:

During the year, the Board has appointed Maj. Gen S. Balakrishnan, VSM (Retd) as additional director in its Board meeting held on 31st October, 2013 who holds offi ce as such till the ensuing AGM.

The Board has also appointed Mrs A Sarada as Whole- Time Director (Finance & Accounts) of the Company for a term of 3 (three) years subject to the approval of members in their Meeting held on 14th May, 2014.

Pursuant to provision of Section 152 of the Companies Act, 2013 read with the rules made thereunder and Clause 49 of the Listing Agreement, all the Independent Directors are being appointed for a term of 5 (fi ve) years and are not liable to retire by rotation.

In accordance with the provisions of Section 152 of the Companies Act, 2013, Dr. Vidya Sagar, Managing Director of the Company will retire by rotation and being eligible, offers himself for the re-appointment.

17. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE:

As per provisions of section 135 of the Companies Act, 2013 and the Rules made thereunder every Company meeting a specifi c criteria shall constitute a Corporate Social Responsibility Committee.

Keeping in view of the above legal requirements and in deference to the public interest, the Board in its Meeting held on 31st July, 2014 has constituted the Corporate Social Responsibility Committee with the following Directors.

Mrs. A. Sarada : Chairperson

Mr. N. Naveen : Member

Mr. Y. Kishore : Member

The terms of reference of the Committee covers the matters specifi ed under section 135 and Schedule V of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014.

18. WHISTLE BLOWER POLICY:

In pursuance of the provisions of the section 177 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014 and amended clause 49 of the listing agreement, the Board has established a vigil mechanism and adopted the Whistle Blower Policy for Directors and employees of the Company to enable them to report their genuine concerns about unethical behaviour, actual or suspected fraud, malpractices, or violation of the Company''s code of conduct without any fear.

Shri Naveen Nandigam has been designated as the Ethics Counsellor for the purpose of effective implementation of the Whistle Blower Policy and redressal of complaints made under this policy.

19. DEMATERIALISATION OF SHARES:

As on 31st March, 2014, 97.69% of paid up capital is in dematerialized form.

20. ACKNOWLEDGEMENT:

Your Directors express their sincere appreciation and gratitude to Canara Bank, Industrial Finance Branch, Hyderabad, for their continued support and to all employees, shareholders, suppliers, customers and various statutory authorities, who have extended their immense support to the Company during the Financial Year under review.

For Avantel Limited

Y. Kishore Chairman of the Meeting Place : Hyderabad Date : 31.07.2014

Mar 31, 2013

Dear Members,

The Directors take pleasure in presenting the Twenty Third Annual Report on the operations of your Company and the Audited Accounts for the financial year ended 31st March, 2013, together with the Auditors'' Report thereon.

PERFORMANCE OF THE COMPANY:

Your Company''s results for the year in comparison with the previous year are given below in a summarized format:

(Rs in Lakhs) Particulars Current Year Previous Year 2012-13 2011-12

Income 4315.67 2608.02

Expenses 3270.64 1974.59

Operating Profit 1045.03 633.43

Depreciation 126.40 119.33

Financial expenses 99.04 49.06

Profit Before Tax (PBT) 819.59 465.04

Provision for tax Current & Deferred 167.67 75.81

Profit After Tax (PAT) 651.92 389.23

Profit brought forward 623.25 498.22

Profit Available for Appropriation 1275.17 887.45

Appropriations:

Transferred to General Reserve 160.00 160.00

Proposed Dividend 112.07 89.66

Corporate Dividend Tax 19.05 14.54

Balance carried to balance sheet 984.05 623.25

Earnings Per Share (EPS)

- Basic 14.54 8.68

- Diluted 14.54 8.68

1. DIVIDEND:

Your Directors have pleasure in recommending a dividend @ Rs. 2.50/- per share (25%) for the financial year 2012-13, out of current year profits absorbing an amount of Rs. 112.07 lakhs towards dividend & Rs. 19.05 lakhs towards dividend distribution tax, subject to the approval of the members of the Company in the ensuing Annual General Meeting.

2. DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of Directors hereby confirms that: -

i. In the preparation of the annual accounts, the applicable Accounting Standards have been followed and there is no material departure.

ii. Appropriate accounting policies have been selected and applied consistently and have 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 31st March, 2013, and of the Profit of the Company for the year ended on that date.

iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities.

iv. Annual accounts have been prepared on a ''going concern'' basis.

3. DEPOSITS:

During the year, the Company has not accepted any deposits covered under the provisions of Sec. 58A of the Companies Act, 1956, read with Companies (Acceptance of the Deposit Rules), 1975.

4. PARTICULARS OF EMPLOYEES:

The particulars of employees, which are required to be given under Sec 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Amendment Rules, 2011:

a. Particulars of employees who are in receipt of Rs. 60 lakhs or more per annum NIL

b. Particulars of employees employed for a part of the financial year with a salary of Rs. lakh or above per month NIL

6. CONSERVATION OF ENERGY & FOREIGN EXCHANGE INFLOW AND OUTFLOW:

The details, as required under Sec 217(1) (e) of the Companies Act, 1956, read with Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988, are given in Annexure-I.

7. TECHNOLOGY, PATENTS, R&D AND INNOVATION:

Your Company has submitted five applications to the Patent office, Government of India, for grant of Patents under different R&D inventions. All are published in the Patents Journal and are waiting for further examination in chronological order of applications filed. The members will be informed of the grant of patents as and when they are granted. Due to long procedure of examination after which the patents will be granted, the likely schedule of examination may be during 2013-14 as per Chennai, IPR wing. However the patents have been published and either, we will receive final exam report or patent certificate.

8. CLOSURE OF CHERLAPALLY PRODUCTION UNIT:

Consequent to the completion of Visakhapatnam facility and commencement of production facility at the new outfit, the Cherlapally unit under lease for the last 5 years had been closed after shifting all the production related equipment to Visakhapatnam. All customers, statutory bodies, inspection agencies have been informed accordingly and the facility at Visakhapatnam has also been duly registered with the local licencing and regulatory authorities.

9. NEW UNIT AT VISAKHAPATNAM:

As was informed during the last year, establishment of a new state of the art manufacturing unit on 0.93 acre of land at Gambheeram Industrial Park, Visakhapatnam, Andhra Pradesh has since been completed.. This exclusive facility will be used for development and manufacturing of defense electronics equipment, satellite communication products, IT products and naval systems. The Center will develop import substitution products in strategic electronics for Indian Defense Services. The Center has commenced production and all the statutory approvals have since been obtained in the name of the new facility. This facility will further strengthen interaction with defence services, particularly with Indian Navy.

10. CORPORATE GOVERNANCE:

Attention of the members is drawn to Annexure-II to this Report dealing with the practices of Corporate Governance, being followed by the Company. A certificate from the Statutory Auditors of the Company regarding compliance of the conditions of the Corporate Governance, as stipulated under Clause 49, also forms part of this Annual Report.

11. SECRETARIAL COMPLIANCE CERTIFICATE

Certificate from a Practicing Company Secretary as stipulated in Section 383A of the Companies Act, 1956 read with the Companies (Compliance Certificate) Rules, 2001, attached as Annexure-III to the Directors'' Report.

12. LISTING FEES:

The Company has paid the listing fees for the year 2013- 14 to BSE Limited (BSE) in pursuance of the Listing Agreement.

13. AUDITORS:

M/s. Ramanatham & Rao, Chartered Accountants, Statutory Auditors of the Company, retires at this ensuing Annual General Meeting and are eligible for re- appointment. Confirmation from the Auditors has been received to the effect that their re-appointment, if made, would be within the limits prescribed under Section 224(1B) of the Companies Act, 1956.

14. COST AUDIT REPORT:

The Board at their meeting held on 6th May, 2013 reappointed Mr. N.V.S. Kapardhi Cost Auditor to carry out the Cost Audit of the Company for the financial year 2013-14. Confirmation from the Cost Auditor has been received to the effect that his re-appointment, if made would be within the limits prescribed under Section 224 (1B) of the Companies Act, 1956.

15. BUY BACK OF EQUITY SHARES OF THE COMPANY

Members are aware that the Board of Directors at their meeting held on 6th May, 2013 approved the Buyback of Equity Shares of the Company which has been commenced with effect from 20th May, 2013 and the Company closed the said Buy Back Offer on 3rd June, 2013 and the Company bought back 3,00,000 Equity Shares of Rs 10/- each during the Buyback Offer. The Board considered to go for further Buyback at its meeting held on 14th June, 2013 upto 25 % of Paid up capital and free reserves seeking your consent through postal ballot.

16. DIRECTORS:

In accordance with the provisions of the Companies Act, 1956, Shri Maj. Gen.(Retd.) Dr. Rajinder Kumar Bagga, AVSM and Shri Y. Kishore, Directors of the Company will retire by rotation and being eligible, offer themselves for re-appointment and the Board recommends their reappointment. The Board of Directors in their meeting held on 31st January, 2013 has approved the re- appointment of Managing Director for another term of 3 years w.e.f. 1st April, 2013 and the resoultion seeking the approval of the members at the ensuing Annual General Meeting is included in the agenda of the notice of AGM.

17. ACKNOWLEDGEMENT:

Your Directors express their sincere appreciation and gratitude to Canara Bank, Industrial Finance Branch, Hyderabad, for their continued support and to all employees, shareholders, suppliers, customers and various statutory authorities, who have extended their immense support to the Company during the Financial Year under review.

For Avantel Limited

Maj Gen. (Retd) Dr. Rajinder Kumar Bagga, AVSM

Chairman

Place : Hyderabad

Date : 14.06.2013

Mar 31, 2012

The Directors take pleasure in presenting the Twenty Second Annual Report on the operations of your Company and the Audited Accounts for the financial year ended 31 st March, 2012, together with the Auditors' Report thereon.

PERFORMANCE OF THE COMPANY:

Your Company's results for the year in comparison with the previous year are given below in a summarized format:

(Rs in Lakhs)

Particulars Current Year Previous Year 2011-12 2010-11

Income 2608.02 2234.60

Expenses 1974.59 1766.35

Operating Profit 633.43 468.25

Depreciation 119.33 114.68

Financial expenses 49.06 40.63

Profit Before Tax (PBT) 465.04 312.94

Provision for tax

Current & Deferred 75.81 67.34

Profit After Tax (PAT) 389.23 245.60

Profit brought forward 498.22 409.94

Profit Available for Appropriation 887.45 655.54

Appropriations:

Transferred to General Reserve 160.00 75.00

Proposed Dividend 89.66 70.60

Corporate Dividend Tax 14.54 11.72

Balance carried to balance sheet 623.25 498.22

Earnings Per Share (EPS)

- Basic 8.68 5.22

- Diluted 8.68 5.22

1. DIVIDEND:

Your Directors have pleasure in recommending a dividend @ Rs 2.00/- per share (20%) for the financial year 201 1-12, out of current year profits absorbing an amount of 7 89.66 lakhs towards dividend & Rs 14.54 lakhs towards dividend distribution tax, subject to the approval of the members of the Company in the ensuing Annual General Meeting.

2. DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of Directors hereby confirms that: -

i. In the preparation of the annual accounts, the applicable Accounting Standards have been followed and there is no material departure.

ii. Appropriate accounting policies have been selected and applied consistently and have 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 31st March, 2012, and of the Profit of the Company for the year ended on that date.

iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities.

iv. Annual accounts have been prepared on a 'going concern' basis.

3. DEPOSITS:

During the year, the Company has not accepted any deposits covered under the provisions of Sec. 58A of the Companies Act, 1956, read with Companies (Acceptance of the Deposit Rules), 1975.

4. PARTICULARS OF EMPLOYEES:

The particulars of employees, which are required to be given under Sec 2I7(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Amendment Rules, 2011:

a. Particulars of employees who are in receipt of Rs 60 lakhs or more per annum : NIL

b. Particulars of employees employed for a part of the financial year with a salary of Rs 5 lakh or above per month : NIL

5. CONSERVATION OF ENERGY & FOREIGN EXCHANGE INFLOW AND OUTFLOW:

The details, as required under Sec 217( I) (e) of the Companies Act, 1956, read with Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988, are given in Annexure-I.

6. TECHNOLOGY, PATENTS, R&D AND INNOVATION:

Your Company has submitted five applications to the Patent office, Government of India, for grant of Patents under different R&D inventions. All are published in the Patents Journal and are waiting for further examination in chronological order of applications filed. The members will be informed of the grant of patents as and when they happen.

7. NEW UNIT AT VISAKHAPATNAM:

The Company is presently having Research & Development (R&D) facility, at Hyderabad, which is recognized by DSIR, Govt, of India. With a view to establish a new unit, the Company has acquired 0.93 acre of land at Gambheeram Industrial Park, Visakhapatnam, Andhra Pradesh in the last year and is presently constructing a certified Green Building. With respect to the constructions work, civil works for the building have been completed and interior, electrical and other miscellaneous works are in progress. The proposed building will be utilized to set up an exclusive facility for development and manufacturing of defense electronics equipment, satellite communication products, IT products and naval systems. Apart from providing employment opportunities for about 150 engineering professionals, the Center will develop import substitution products in strategic electronics for Indian Defense Services. The Unit is likely to be operational in this financial year only.

8. CORPORATE GOVERNANCE:

Attention of the members is drawn to Annexure-II to this Report dealing with the practices of Corporate Governance, being followed by the Company. A certificate from the Statutory Auditors of the Company regarding compliance of the conditions of the Corporate Governance, as stipulated under Clause 49, also forms part of this Annual Report.

9. LISTING FEES:

The Company has paid the listing fees for the year 2012-13 to Bombay Stock Exchange Limited (BSE) in pursuance of the Listing Agreement.

10. AUDITORS:

M/s. Ramanatham & Rao, Chartered Accountants, Statutory Auditors of the Company, retires at this ensuing Annual General Meeting and is eligible for re- appointment. Confirmation from the Auditors has been received to the effect that their re-appointment, if made, would be within the limits prescribed under Section 224( IB) of the Companies Act, 1956.

11. COST AUDIT REPORT:

The Company was subjected to Cost Audit under Section 23 3 B of the Companies Act, 1956 as per the Central Government Industry-wise General Order i.e. to conduct the audit of Cost accounting records maintained by the Company, in relation to telecommunication products, for the financial year ending on 31st March, 2012. Accordingly, the Company appointed Mr. N.V.S. Kapardhi, Cost Auditor to carry out Cost Audit for the financial year 2011-12 and submit his report to the Central Government.

12. BUY BACK DURING THE YEAR:

Members are aware that the Board of Directors at their meeting held on 13th October, 201 I approved the Buy Back of Equity Shares of the Company which has been commenced with effect from 5th December, 201 I and the Company has closed the said Buy Back Offer w.e.f. 25th January, 2012 and the Company has bought back 2,09,413 Equity Shares of 7 10 each during the Buy Back Offer.

13. DIRECTORS:

In accordance with the provisions of the Companies Act, 1956, Shri N. Naveen Director of the Company will retire by rotation and being eligible, offer himself for re-appointment. During the Financial Year Shri. K.B.K. Moorthi, Shri. M. Venkata Rao resigned as Directors of the Company w.e.f 13th October, 2011 and Maj. S.S. Mohanthy was appointed as Director of the Company w.e.f. 13th October, 201 I. However, subsequent to the financial year Mr. N. Divakar, Whole Time Director and Maj. S.S. Mohanthy, Director have resigned from the Board w.e.f. 30th April, 2012.

14. ACKNOWLEDGEMENT:

Your Directors express their sincere appreciation and gratitude to Canara Bank, Industrial Finance Branch, Hyderabad, for their continued support and to all employees, shareholders, suppliers, customers and various statutory authorities, who have extended their immense support to the Company.

For Avantel Limited

Maj Gen (Retd) Dr. Rajinder Kumar Bagga, AVSM

Chairman

Place : Hyderabad

Date : 30.04.2012

Mar 31, 2011

Dear Members,

The Directors take pleasure in presenting the Twenty First Annual Report on the operations of your Company and the Audited Accounts for the financial year ended 31st March, 2011, together with the Auditors' Report thereon.

PERFORMANCE OF THE COMPANY:

Your Company's results for the year in comparison with the previous year are given below in a summarized format:

(Rs. in Lakhs)

Particulars Current Year Previous Year 2010-11 2009-10

Income 2415.19 2280.14

Expenses 1946.94 2011.57

Operating Profit 468.25 268.57

Depreciation 114.68 123.35

Financial expenses 40.63 28.24

Profit Before Tax (PBT) 312.94 116.98

Excess/(Short) provision relating to earlier years 4.94 (16.99)

Provision for tax Current & Deferred 62.40 10.55

Profit After Tax (PAT) 245.60 123.43

Profit brought forward 409.94 371.57

Profit Available for Appropriation 655.54 495.00

Appropriations:

Transferred to General Reserve 75.00 30.00

Proposed Dividend 70.60 47.06

Corporate Dividend Tax 11.72 8.00

Balance carried to balance sheet 498.22 409.94

Earnings Per Share (EPS)

-Basic 5.32 2.26

-Diluted 5.32 2.21

1. DIVIDEND:

Your Directors have pleasure in recommending a dividend @ Rs. 1.50/- per share (15%) for the financial year 2010-11, out of current year profits absorbing an amount of Rs. 70.60 lakhs towards dividend & Rs. 11.72 lakhs towards dividend distribution tax, subject to the approval of the members of the Company in the ensuing Annual General Meeting.

3. DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of Directors hereby confirms that: -

i. In the preparation of the annual accounts, the applicable Accounting Standards have been followed and there is no material departure.

ii. Appropriate accounting policies have been selected and applied consistently and have 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 31st March, 2011, and of the Profit of the Company for the year ended on that date.

iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities.

iv. Annual accounts have been prepared on a 'going concern' basis.

4. DEPOSITS:

During the year, the Company has not accepted any deposits covered under the provisions of Sec. 58A of the Companies Act, 1956, read with Companies (Acceptance of the Deposit Rules), 1975.

5. PARTICULARS OF EMPLOYEES:

The particulars of employees, which are required to be given under Sec 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Amendment Rules, 2011:

a. Particulars of employees who are in receipt of Rs.60 lakhs or more per annum NIL

b. Particulars of employees employed for a part of the financial year with a salary of Rs.5 lakh or above per month NIL

6. CONSERVATION OF ENERGY & FOREIGN EXCHANGE INFLOW AND OUTFLOW:

The details, as required under Sec 217(1) (e) of the Companies Act, 1956, read with Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988, are given in Annexure-I.

7. TECHNOLOGY, PATENTS, R&D AND INNOVATION:

Your Company has submitted five applications to the Patent office, Government of India, for grant of Patents under different R&D inventions. All are published in the Patents Journal and are waiting for further examination in chronological order of applications filed. The members will keep informed of the grant of patents as and when they happen.

8. NEW UNIT AT VISAKHAPATNAM:

The Company is presently having Research & Development (R&D) facility, at Hyderabad, which is recognized by DSIR, Govt. of India. With a view to establish a new unit, the Company has acquired 0.93 acre of land at Gambheeram Industrial Park, Visakhapatnam, Andhra Pradesh, and is presently constructing a certified Green Building. The proposed building will be utilized to set up an exclusive R&D Center and manufacturing facility for Aero Space sector. Apart from providing employment opportunities for about 150 engineering professionals, the Center will develop import substitution products in strategic electronics for Indian Defense Services. The Center will be operational in the next financial year.

9. CORPORATE GOVERNANCE:

Attention of the members is drawn to Annexure-II to this Report dealing with the practices of Corporate Governance, being followed by the Company. A certificate from the Statutory Auditors of the Company regarding compliance of the conditions of the Corporate Governance, as stipulated under Clause 49, also forms part of this Annual Report.

10. LISTING FEES:

The Company has paid the listing fees for the year 2011-12 to Bombay Stock Exchange Limited (BSE) in pursuance of the Listing Agreement.

11. AUDITORS:

M/s. A. Madhusudana & Co., Chartered Accountants, Statutory Auditors of the Company, retires at this ensuing Annual General Meeting and expressed un- willingness for re-appointment due to pre-occupations. The Board also taken in to consideration the corporate governance voluntary guidelines and recommended M/s. Ramanatham & Rao. Chartered Accountants, for appointment as Statutory Auditors of the Company. Necessary confirmation has been received to the effect that their appointment, if made, would be within the limits prescribed under Section 224(1B) of the Companies Act, 1956.

12. DIRECTORS:

Shri A. Venkateswara Rao and Maj. Gen. (Retd.). S. Bala Krishnan, VSM, Rotational Directors, have decided not to seek re-appointment and retire at the present AGM. In their place, the Board has recommended Maj. Gen. (Retd.) Dr. R.K. Bagga, AVSM, and Shri N. Naveen as Directors liable to retire by rotation.

Shri N. Naveen and Maj. Gen. (Retd.) Dr. R.K. Bagga, AVSM, who are already on the Board as Additional Directors, and whose term is expiring at the ensuing Annual General Meeting, are proposed for appointment as Directors liable to retire by rotation, as mentioned above.

Shri Y. Kishore was inducted in to the Board as Additional Director of the Company and necessary resolution has been put forth for his continuation as Director, liable to retire by rotation.

In compliance with the Corporate Governance Voluntary Guidelines, Shri K.B.K. Moorthi, Director, has submitted resignation and the Board has approved the same in its meeting held on 07th July, 2011.

13. ACKNOWLEDGEMENT:

Your Directors express their sincere appreciation and gratitude to Canara Bank, Industrial Finance Branch, Hyderabad, for their continued support and to all employees, shareholders, suppliers, customers and various statutory authorities, who have extended their immense support to the Company.

By order of the Board

N. Naveen Director

Dr. A. Vidyasagar Managing Director

Place : Hyderabad Date : 07.07.2011

Mar 31, 2010

The Directors take pleasure in presenting the Twentieth Annual Report on the operations of your Company and the Audited Accounts for the financial year ended 31st March 2010, together with the Auditors Report thereon.

PERFORMANCE OF THE COMPANY:

Your Companys results for the year in comparison with the previous year are given below in a summarized format:

(Rs. in Lakhs)

Particulars Current Year Previous Year

2009-10 2008-09

Income 2280.14 2760.27

Expenses 2011.57 2284.65

Operating Profit 268.57 475.62

Depreciation 123.35 113.71

Financial expenses 28.24 21.06

Profit Before Tax 116.98 340.84

Excess/(Short) provision

relating to Earlier years 16.99 (8.59)

Provision for tax

(Current & Deferred) (10.55) (87.59)

Profit After Tax 123.43 244.67

Profit brought forward 371.57 295.74

Profit Available for

Appropriation 495.00 540.40

Appropriations:

Transferred to General Reserve 30.00 100.00

Proposed Dividend 47.06 58.83

Corporate Dividend Tax 8.00 10.00

Balance carried to balance sheet 409.94 371.57

Earnings Per Share (EPS)

- Basic 2.26 4.75

- Diluted 2.21 4.75

1. DIVIDEND:

Your Directors have pleasure in recommending a dividend @ 10% for the financial year 2009-10, out of current year profits absorbing an amount of Rs. 47.06

lakhs towards dividend & Rs. 8 lakhs towards dividend distribution tax, subject to the approval of the members of the Company in the ensuing Annual General Meeting.

3. DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of Directors hereby confirms that: -

i. In the preparation of the annual accounts, the applicable Accounting Standards have been followed and there is no material departure.

ii. Appropriate accounting policies have been selected and applied consistently and have 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 31st March 2010 and of the Profit of the Company for the year ended on that date.

iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities.

iv. Annual accounts have been prepared on a going concern basis.

4. DEPOSITS:

During the year, the Company has not accepted any deposits covered under the provisions of Sec. 58A of the Companies Act, 1956 read with Companies (Acceptance of the Deposit Rules), 1975.

5. PARTICULARS OF EMPLOYEES:

The particulars of employees, which are required to be given under Sec 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of employees) Amendment Rules, 2000.

a. Particulars of employees who are in receipt of Rs.24 lakhs or

more per annum NIL

b. Particulars of employees employed for a part of the financial year with a salary of Rs.2 lakh or

above per month NIL

6. CONSERVATION OF ENERGY & FOREIGN EXCHANGE INFLOW AND OUTFLOW:

The details as required under Sec 217(1) (e) of the Companies Act, 1956 read with Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988, are given in Annexure-I.

7. CORPORATE GOVERNANCE:

Attention of the members is drawn to Annexure-II to this Report dealing with the practices of Corporate Governance, being followed by the Company. A certificate from the Auditors of the Company regarding compliance of the conditions of the Corporate Governance, as stipulated under Clause 49 also forms part of this Annual Report.

The Ministry of Corporate Affairs has announced the Corporate Governance Voluntary Guidelines 2009. The preamble mentioned about good practices for adoption by the Companies, which are in addition to the existing ones and recommendatory in nature. Similarly, the Ministry has also issued the Corporate Social Responsibility Voluntary Guidelines 2009 duly mentioning CSR activities, which are purely voluntary in nature.

Your Company has reviewed the above Guidelines and ensured to adhere some of the practices, as these guidelines are Volunatary in nature.

In respect of the Voluntary Guidelines pertaining to the tenure of Shri. K.B.K. Moorthi and Maj. Gen (Retd). S. Balakrishnan, VSM, Independent Directors, whose tenure has exceeded six years, the Board of Directors considering their valuable guidance and contribution in various facets of the Company which are invaluable, decided to avail their services for some more time for better performance of the Comapny

8. LISTING FEES:

The Company has paid the listing fees for the year 2010-11 to Bombay Stock Exchange Limited (BSE) in pursuance of the Listing Agreement.

9. AUDITORS:

M/s. A. Madhusudana & Co., Chartered Accountants, Statutory Auditors of the Company retires at this ensuing Annual General Meeting and is eligible for re- appointment. Confirmation from the Auditors has been received to the effect that their re-appointment, if made, would be within the limits prescribed under Section 224(1B) of the Companies Act, 1956.

10. DIRECTORS:

In accordance with the provisions of the Companies Act, 1956, Shri K.B.K. Moorthi and Shri M. Venkata Rao, Directors of the Company will retire by rotation and being eligible, offer themselves for re-appointment.

The tenure of Dr. A. Vidyasagar, Managing Director was expired on 31st March 2010, and Board recommends for re-appointment of another three years. Necessary resolution is commended for the approval of members.

Similarly, the tenure of Shri N. Divakar, Director (Technical) will be expiring on 31st October 2010, and Board recommends for re-appointment of another two years. Necessary resolution is commended for the approval of members.

Further, due to preoccupations, Shri M.L.N. Acharyulu, Director, has submitted his resignation and the Board has approved the same in its meeting held on 30th July, 2010.

11. ACKNOWLEDGEMENT:

Your Directors express their sincere appreciation and gratitude to Canara Bank, Industrial Finance Branch, for their continued support and to all employees, shareholders, suppliers, customers and various statutory authorities, who have extended their immense support to the Company.

By Order of the Board

Place: Hyderabad A. Venkateswara Rao

Date: 30.07.2010 Chairman

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